2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
2019 Annual Report
April 2020
1
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section I Important Statements, Contents and Definitions
The board of directors, board of supervisors, directors, supervisors and senior management of Jiangsu
Yanghe Brewery Joint-Stock Co., Ltd. (hereinafter referred to as the Company) hereby guarantee that
the information presented in this report is free of any false records, misleading statements or material
omissions, and shall individually and together be legally liable for truthfulness, accuracy and
completeness of its contents.
Mr. Wang Yao, responsible person for the Company, Mr. Cong Xuenian, responsible person for
accounting affairs and Mr. Yin Qiuming, responsible person for accounting department (accounting
supervisor) have warranted that the financial statements in this report are true and complete.
All directors attended the board meeting to review this report.
The future plans and some other forward-looking statements mentioned in this report shall not be
considered as virtual promises of the Company to investors. Investors and people concerned should
maintain adequate risk awareness and understand the difference between plans, predictions and
promises. Investors are kindly reminded to pay attention to possible investment risks.
In the annual report, the possible risks in the operation of the Company are described in detail (see 9.
Outlook for the future development of the Company in Section IV Performance Discussion and
Analysis). Investors are kindly reminded to pay attention to relevant content.
The profit distribution plan approved by the board of directors: based on share capital participating in
the dividend on the registration date when the profit distribution plan is implemented in the future, a
cash dividend of CNY 30.00 (tax inclusive) will be distributed for every 10 existing shares held, 0 shares
of bonus shares (tax inclusive), and reserves would not be converted into share capital.
The Company’s Chinese 2019 Annual Report was publicly disclosed on the Shenzhen Stock Exchange
and www.cninfo.com.cn on 29 April 2020. If there are any differences between the English version and
the Chinese one, please refer to the latter.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Contents
Section I Important Statements, Contents and Definitions ........................ 2
Section II Company Profile and Key Financial Results ............................... 5
Section III Business Profile .............................................................................. 9
Section IV Performance Discussion and Analysis ..................................... 12
Section V Significant Events ......................................................................... 27
Section VI Changes in Shares and Information about Shareholders ..... 64
Section VII Information about Preference Shares ...................................... 71
Section VIII Information about Convertible Bonds .................................... 72
Section IX Profiles of Directors, Supervisory, Senior Management and
Employees ........................................................................................................ 73
Section X Corporate Governance ................................................................. 83
Section XI Information about Corporate Bond ........................................... 91
Section XII Financial Report........................................................................... 92
Section XIII Documents Available for Preference .....................................216
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Definitions
Term Reference Definition
The Company, This Company, Yanghe Jiangsu Yanghe Brewery Joint-Stock Co.,
Refer to
Joint-Stock Ltd.
Yanghe Group, Controlling shareholder Refer to Jiangsu Yanghe Group Co.,Ltd.
The current year, In the reporting period Refer to 1 Jan. 2019 to 31 Dec. 2019
The report Refer to 2019 Annual Report
Yuan, Ten thousand yuan, A hundred CNY 0.00, CNY 10,000.00,CNY
Refer to
million yuan 100,000,000.00
The shareholders' general meeting, the
The shareholders' meeting, the board of
Refer to board of directors and the board of
directors, the board of supervisors
supervisors of the Company
Articles of incorporation of Jiangsu Yanghe
Articles of incorporation Refer to
Brewery Joint-Stock Co., Ltd.
SSE Refer to Shenzhen Stock Exchange
SRC,CSRC Refer to China Securities Regulatory Commission
State-owned Assets Supervision and
SASAC of Suqian Refer to
Administration Commission of Suqian
Suya Jincheng, Accounting firm Refer to Suya Jincheng CPA LLP
Blue Alliance Refer to Jiangsu Blue Alliance Joint-Stock Co., Ltd.
Jiangsu Yanghe Brewery Joint-Stock Co.,
Yanghe Branch of the Company Refer to
Ltd. Yanghe Branch
Jiangsu Yanghe Brewery Joint-Stock Co.,
Siyang Branch of the Company Refer to
Ltd. Siyang Branch
Jiangsu Shuanggou Distillery Stock
Shuanggou Distillery Refer to
Co.,Ltd.
Guijiu Company Refer to Guizhou Guijiu Co., Ltd.
Lihuacun Distillery Refer to Hubei Lihuacun Distillery Co., Ltd.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section II Company Profile and Key Financial Results
1. Corporate information
Stock abbreviation Yanghe Joint-Stock Stock code 002304
Stock exchange where
the shares of the Shenzhen Stock Exchange
Company are listed
Name of the Company
江苏洋河酒厂股份有限公司
in Chinese
Abbr. of the Company
洋河股份
name in Chinese
Name of the Company
Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
in English (if any)
Abbr. of the Company
Yanghe
name in English (if any)
Legal representative Wang Yao
Registered address No.118 Middle Avenue, Yanghe Town, Suqian City, Jiangsu Province, China
Postal code of
223800
registered address
Business address No.118 Middle Avenue, Yanghe Town, Suqian City, Jiangsu Province, China
Postal code of business
223800
address
Company website http://www.chinayanghe.com
E-mail yanghe002304@vip.163.com
2. Contact us
Company secretary Representative for securities affairs
Name Cong Xuenian Lu Hongzhen, Sun Dali
Address No. 18, Feng Hui Avenue, Yuhua Economic Development Zone, Nanjing
Tel. 025-52489218
Fax 025-52489218
E-mail yanghe002304@vip.163.com
3. Information disclosure and place where the annual report is kept
Newspaper designated by the Company Securities Times, Shanghai Securities Times, China Securit
for information disclosure ies Journal, Securities Daily
Website designated by CSRC for the
http://www. cninfo.com.cn
publication of the Annual Report
Place where the Annual Report of the Shareholder reading room, the headquarters of the
Company is kept Company, Suqian City, Jiangsu Province
4. Company registration and alteration
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Organization code 9132000074557990XP
Changes in main business activities since
None
the Company was listed (if any)
Changes of controlling shareholders of the
None
Company (if any)
5. Other relevant information
Accounting firm engaged by the Company
Name of the accounting firm Suya Jincheng CPA LLP
22-23/F., Central International Plaza, No.105-6 North
Business address of the accounting firm
Zhongshan Road, Nanjing.
Name of accountants for writing signature Kan Baoyong, Li Yan
Sponsors engaged by the Company to continuously perform its supervisory function during the
reporting period
Applicable √ N/A
Financial adviser engaged by the Company to continuously perform its supervisory function during the
reporting period
Applicable √ N/A
6. Key accounting data and financial indicators
Whether the Company performed a retroactive adjustment or restatement of accounting data
Yes √ No
2019 2018 YoY 2017
Change
Operating revenues (CNY) 23,126,476,885.07 24,159,801,994.68 -4.28% 19,917,942,238.16
Net profits attributable to
shareholders of the Company 7,382,822,726.87 8,115,189,794.69 -9.02% 6,627,169,959.16
(CNY)
Net profits attributable to
shareholders of the Company
6,555,890,029.81 7,369,331,605.77 -11.04% 6,136,386,923.71
before non-recurring gains and
losses (CNY)
Net cash flows from operating
6,797,891,871.41 9,056,748,816.28 -24.94% 6,883,169,799.31
activities (CNY)
Basic earnings per share
4.8991 5.3850 -9.02% 4.3976
(CNY/share)
Diluted earnings per share
4.8991 5.3850 -9.02% 4.3976
(CNY/share)
Weighted average ROE 21.21% 25.95% -4.74% 24.08%
YoY
At the end of 2019 At the end of 2018 At the end of 2017
Change
Total assets (CNY) 53,455,037,840.98 49,563,767,816.22 7.85% 43,258,140,702.38
Net assets attributable to
shareholders of the Company 36,508,835,491.47 33,644,530,266.23 8.51% 29,515,040,285.72
(CNY)
7. Differences in accounting data under domestic and overseas
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
accounting standards
7.1. Differences in the net profits and net assets disclosed in the financial reports
prepared under the international and China accounting standards
Applicable √ N/A
No such differences during this period.
7.2. Differences in the net profits and net assets disclosed in the financial reports
prepared under the outbound and China accounting standards
Applicable √ N/A
No such differences during this period.
8. Key financial results by quarter
Unit: CNY
Q1 Q2 Q3 Q4
10,889,633,584.07 5,108,949,278.67 5,099,149,429.96 2,028,744,592.37
Operating revenues
Net profits attributable to 4,020,764,957.82 1,560,940,705.86 1,564,626,614.67 236,490,448.52
shareholders of the Company
Net profits attributable to
shareholders of the Company 3,809,771,428.82 1,399,214,559.41 1,338,015,326.52 8,888,715.06
before non-recurring gains
and losses
Net cash flows from operating 122,965,637.48 -633,029,399.83 2,229,448,446.04 5,078,507,187.72
activities
Whether there are any material differences between the financial indicators above or their summations
and those which have been disclosed in quarterly or semi-annual reports.
Yes √ No
9. Non-recurring profits and losses
√ Applicable N/A
Unit: CNY
Item 2019 2018 2017 Note
Profit or loss from disposal of non-current
13,797,266.00 22,203,572.96 -8,598,844.11
assets (including the write-off portion of the
impairment provision)
Government grants recorded in the profit or
loss for the current period (except for the
government grants closely related to the 85,605,383.19 59,870,221.67 44,745,640.94
business of the Company and given at a fixed
amount or quantity in accordance with the
State's uniform standards)
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Item 2019 2018 2017 Note
Except for effectively hedging business related
to normal business operations of the
Company, profit or loss arising from the
changes in the fair value of financial assets
held for trading, derivative financial assets,
973,456,912.43 56,995,537.28 90,627,738.02
financial liabilities held for trading, derivative
financial liabilities, and investment income from
disposal of financial assets held for trading,
derivative financial assets, financial liabilities
held for trading, derivative financial liabilities
and investment in other debt instruments.
Impairment provision reversal of the accounts
300,000.00
receivables and contract assets on which the
impairment test is carried out individually
Other non-operating income and expenditure 12,845,147.02 27,967,026.98 11,559,390.23
except above-mentioned items
Other profit and loss items that conform to the 1,670,388.78 827,837,138.81 516,824,879.08
definition of non-recurring gains and losses
260,122,467.95 248,875,376.58 164,658,711.09
Less: Corporate income tax
319,932.41 139,932.20 17,057.62
Minority interests (after tax)
826,932,697.06 745,858,188.92 490,783,035.45
Total --
Explain the reasons if the Company classifies an item as a non-recurring profit and loss according to
the definition in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering
Their Securities to the Public-Non-Recurring Profits and Losses, or classifies any non-recurring profit or
loss item mentioned in the explanatory announcement as a recurring profit or loss item.
Applicable √ N/A
No such cases for the reporting period.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section III Business Profile
1. Main business scope in the reporting period
The Company is mainly engaged in the production and sales of liquor. The production of liquor adopts
solid-state fermentation. The sales of liquor mainly adopt two modes, namely distribution and retailing.
During the reporting period, the Company's primary business and business mode had not changed.
According to the Guidelines for the Industry Classification of Listed Companies (2012 Revision) issued
by CSRC, the Company belongs to C15 Manufacturing industry of liquor, beverages and refined tea.
The Company is a national large-scale liquor production enterprise. Among the enterprises in the liquor
industry, the Company is the only one which has two famous Chinese liquor, namely Yanghe and
Shuanggou, two Chinese time-honored brands, and six Chinese well-known trademarks. The leading
products of the Company are a series of mellow liquor including Dream Blue, Yanghe Blue Classic,
Shuanggou Zhenbaofang, Yanghe Daqu, Shuanggou Daqu. They have high brand awareness and
reputation throughout the country.
During the reporting period, the development of liquor industry kept growing in the fierce competition.
High-end and secondary high-end Liquor both showed obvious development advantages. The
concentration, branding and premiumisation of the industry continued significantly. According to
disclosed liquor industry periodic reports, the Company's operating revenue and profit remained in the
third place in the liquor industry.
2. Significant changes in the main assets
2.1 .Significant changes in the main assets
Main assets Reasons for any significant change
An increase of 70.29% YoY was mainly due to input of 40,000 tons of
Construction in progress
pottery jar warehouse construction during this period.
An increase of 61.67% YoY was mainly due to the increase of
Other non-current financial
purchased trust financial products due over one year during this
assets
period.
2.2 .Main assets overseas
Applicable √ N/A
3. Analysis of core competitiveness
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
The Company has obvious advantages in natural environment, quality technology, brand building,
marketing network and so on. The Company has formed its unique core competitiveness, which has not
changed during the reporting period.
3.1 Natural environment advantage
The Company is located in Suqian, the capital of liquor with 'three rivers, two lakes and one wetland’.
As one of the three famous wetlands in the world, Suqian enjoys equal popularity with the Scotch
whisky producing area and the French Cognac producing area. It is the only natural oxygen bar in
Jiangsu province without acid rain. The long history and unique ecological environment provide a good
source of water, soil and air for production of liquor and spirits. Especially the microorganism condition
is significantly beneficial to producing liquor and spirits. The Yanghe brewing originated in the Sui and
Tang Dynasties, flourished in the Ming and Qing Dynasties. It had been sold in Jianghuai area during
the period of Yong Zheng of Qing Dynasty. It has a good reputation that 'dainty taste derived from
fortune spring and liquor ocean, which makes Yanghe rank first place in Jianghuai area'. Shuanggou
alongside Yanghe has been praised as the origin of Chinese natural liquor by domestic and overseas
experts due to the discovery of drunken ape fossils in Xiacaowan.
3.2 Quality advantage
Considering the diversification and individuation of consumption demand, the Company took the lead in
breaking the traditional classification of liquor flavor. The Company classifies the liquor by taste and put
emphasis on taste value. The Company strengthens the mellowness of liquor, puts forward the new
style of the mellow liquor quality, and deeply meets core demand of target consumers. It successfully
establishes the system framework of new production technology and mellowness mechanism of mellow
liquor catering to market consumption. In June 2008, 'Mellowness' was first written into the national
standard in China Protected Geographical Indication Product- Yanghe Daqu (Standard No.
GB/T220406-2008).
3.3 Talent advantage
The Company has 31 Masters of Chinese liquor, including 69 provincial liquor tasting committee
members and 1862 technicians. The Company also has 10 national and provincial technical research
and development platforms. The obvious advantage of technical talents provides technical support for
the continuous improvement of the quality. Dream Six (International Edition) and Shuanggou
Zhenbaofang (Fengtan Liquor), the representative products of mellow liquor designed by the Company,
have won the 2019 China Liquor Body Design Award. In the national liquor taster contest sponsored by
China Alcoholic Drinks Association, the Company is the only one that won three consecutive
championships among all contestants. It also shows the great advantage of talents.
3.4 Brand advantage
The Company, as one of the old eight famous liquor enterprises, is the only one which has two famous
Chinese liquors, namely Yanghe and Shuanggou, two Chinese time-honored brands, and six Chinese
well-known trademarks, including Yanghe, Shuanggou, Yanghe Spirit Classic, Zhenbaofang, Dream
Blue, and Su. The Company's brands were selected in 2019 Global Liquor Brand Value Top 50 at a
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
value of USD 9.06 billion by Brand Finance, a world-famous brand value research organization, and
and ranked the third place in the world. In 2019, with brands worth CNY 56.08 billion, the Company
ranked the No.84 in China's 500 Most Valuable Brands released by World Brand Lab.
3.5 Marketing network advantage
The Company has a marketing team with the largest size, the latest concept and the strongest
executive force in the industry. The marketing network has penetrated into every county and every city
throughout the country. High speed channel has been basically completed. These laid a solid
foundation for market expansion and extension of the category in the future. The Company obtained
several honors such as model enterprise of industrial Internet development in Jiangsu province,
software copyright of ‘one item one code’, and service-oriented manufacturing enterprise in Jiangsu
province. At the same time, as a traditional enterprise, the Company has also insisted on exploring new
marketing mode, and has made some achievements in Internet application innovation.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section IV Performance Discussion and Analysis
1. Overview
In 2019, faced with the complex and changing macro situation and increasing difficulties
and challenges, the Company thoroughly implemented the general idea of “steadying the
helm when wind changes and setting sail when going forward”, actively responded to
changes, took the initiative to adjusting and transforming, fully implemented the "1246"
project, and promoted smooth development of the Company by adjusting and
transforming the sales system. This is mainly manifested in the following four aspects:
First, both stability and progress were realized. In 2019, the Company achieved revenue
of CNY 23.126 billion, and net profit attributable to shareholders of CNY 7.383 billion. Its
overall net profit remained one of the top three in the industry. The Company insisted on
consumer orientation and redefined the connotation of "good liquor". The classification
mode of liquor has achieved a major change. The mellowness of raw liquor has been
significantly improved, and the aroma and layering have become more prominent. The
fullness and mellowness of liquor has surpassed that in the past. Based on the product
individuation, differentiation, and characteristics, the Company successfully created a
series of good products such as Dream Six plus, Su Toupai Liquor, Yanghe 1949
Fengtan Liquor and Shuanggou Zhenbaofang Fengtan Liquor. These products won high
praise from all walks of life.
Second, both internal and external achievements were obtained. In 2019, the Company
established the technical system of "large base liquor group", intensified efforts in
tackling key technical issues and building research platforms, significantly enhanced its
strategic reserve of base liquor and research and development capability, and
continuously enlarged its technological innovation advantages. With efficient
communication as a core, the Company promoted brand classification management,
implemented low-cost, accurate and integrated communication, and constantly improved
its brand image. It has successively won the first place in liquor of "China's top 100
technology enterprises in light industry" and the "top 100 most valuable Chinese brands
of 2019", which interprets the quality and value of Chinese high-end liquor.
Third, both offense and defense were possessed. In 2019, the Company continued to
break through the thinking pattern, further promoted innovation drive, and injected new
impetus for sustainable development. Intelligent brewing workshop (version 4.0), MES
system of intelligent packaging factory and financial information system have been put
into use, and the digital transformation of sales system has achieved remarkable results.
The Company adhered to the guidance of profit and efficiency improvement, and created
a scientific and efficient management system. The mechanism makes progress
spontaneously and steadily. The whole staff improved the closed-loop management. The
long-term inspection was pragmatic and efficient. The increase in revenue and the
reduction in expenditure reached the target. The organization fission and marketing of
amoeba was implemented precisely.
Fourth, both detailed and high-profile events were considered. In 2019, the Company
closely linked to the working idea of “being first-class” in the cultural construction. The
Company promoted enterprise culture development to a new level. Yanghe underground
liquor cellars, old cellars and distilling workshops were included in the national key
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
cultural relics protection units and national industrial heritage list. The biggest pottery jar
warehouse was completed successfully. The Chinese liquor live museum group with "one
axis and one band, one core and 14 pavilions" was completed and opened. The
company has made significant influence by holding major events. The Company has
successfully held "Yanghe 1949, a gift to the motherland" sealing ceremony, "Guyu
forum", "China Toupai liquor cellar festival" and other influential cultural feasts in the
industry. Meanwhile, the Company has actively participated in important international and
domestic activities, which has been widely recognized and praised.
2. Analysis of main business
2.1. Overview
Same with the contents presented in “1.Overview” of this section.
2.2. Revenues and cost of sales
2.2.1. Breakdown of operating revenues
Unit：CNY
2019 2018
As a percentage As a percentage
YoY change
Amount of operating Amount of operating
revenues revenues
Total 23,126,476,885.07 100% 24,159,801,994.68 100% -4.28%
By business segment
Liquor 22,161,278,307.05 95.83% 23,186,902,149.00 95.97% -4.42%
Others 965,198,578.02 4.17% 972,899,845.68 4.03% -0.79%
By product
Liquor 21,967,044,396.58 94.99% 22,913,294,724.76 94.84% -4.13%
Wine 194,233,910.47 0.84% 273,607,424.24 1.13% -29.01%
Others 965,198,578.02 4.17% 972,899,845.68 4.03% -0.79%
By geographical segment
Jiangsu 11,011,399,137.52 47.61% 12,326,360,162.73 51.02% -10.67%
Ex-Jiangsu 12,115,077,747.55 52.39% 11,833,441,831.95 48.98% 2.38%
2.2.2. Business segment, products or geographical segments
contributing over 10% of the operating revenues or profits
√ Applicable N/A
Unit：CNY
Gross YoY change YoY change
Operating YoY change of
Cost of sales profit of operating of gross
revenues cost of sales
margin revenue profit margin
By business segment
Liquor 22,161,278,307.05 5,772,779,588.18 73.95% -4.42% 4.44% -2.21%
By product
Liquor 21,967,044,396.58 5,643,498,376.83 74.31% -4.13% 4.65% -2.16%
By geographical segment
Jiangsu 10,299,457,647.02 3,007,670,574.12 70.80% -11.30% 0.77% -3.50%
Ex-
11,861,820,660.03 2,765,109,014.06 76.69% 2.48% 8.74% -1.34%
Jiangsu
Under the circumstances that the statistical standards for the Company’s main business
data adjusted in the reporting period, the Company’s main business data in the current
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
one year is calculated based on adjusted statistical standards at the end of the reporting
period.
Applicable √ N/A
2.2.3. Whether revenue from physical sales is higher than service
revenue
√ Yes □ No
By
business Item Unit 2019 2018 YoY change
segment
Sales volume ton 186,022.52 214,051.34 -13.09%
Production
Liquor ton 179,315.33 211,606.75 -15.26%
volume
Inventory volume ton 18,156.75 24,863.94 -26.98%
Sales volume ton 4,854.36 5,288.96 -8.22%
Production
Wine ton 4,137.99 6,315.57 -34.48%
volume
Inventory volume ton 644.25 1,360.62 -52.65%
Reasons for any over 30% YoY changes in the data above.
√ Applicable N/A
The decrease of 34.48% YoY in production volume of wine and the decrease of 52.65%
YoY inventory of wine was mainly because the wine was imported with original
packaging and stock in advance during last period led to large inventory of wine by the
end of last period. Meanwhile, both the production volume and sales volume decreased
in this period.
2.2.4. Execution of significant sales contracts in the reporting period
Applicable √ N/A
2.2.5. Breakdown of cost of sales
By business and product segment
Unit：CNY
By 2019 2018
YoY
business Item As a percentage As a percentage
Amount Amount change
segment of cost of sales of cost of sales
Liquor 5,772,779,588.18 87.12% 5,527,417,445.92 87.00% 4.44%
Unit：CNY
2019 2018
By As a
As a YoY
product Item percentage
Amount percentage of Amount Change
segment of cost of
cost of sales
sales
Liquor Raw materials 4,284,348,458.13 64.66% 4,397,294,002.46 69.21% -2.57%
Liquor Labor costs 904,555,426.95 13.65% 597,717,848.21 9.41% 51.33%
Fuels and
Liquor 226,377,369.91 3.42% 246,871,521.50 3.89% -8.30%
energy
Manufacturing
Liquor 357,498,333.19 5.40% 280,144,635.22 4.41% 27.61%
overhead
Consumption
Liquor tax and 5,389,438.53 0.08% -100.00%
surcharges
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Note:
The increase of 51.33% YoY in labor costs was mainly due to an increase in wages
during this period.
The decrease of 100% in consumption tax and surcharges was mainly due to that there
was no manufacturing consignment during this period.
2.2.6. Changes in the scope of the consolidated financial statements for
the reporting period
√ Yes No
1. Establishment of subsidiaries
In September 2018, the Company registered and established Yanghe Hong Kong
Distillery Co., Ltd. in Hong Kong, which was invested in October 2019 and included in the
consolidated financial statements from October 2019.
2. Cancellation of subsidiaries
(1) Jiangsu Guanmeng Information Technology Co., Ltd., the holding subsidiary, was
liquidated and terminated, and on 12 February 2019, it obtained Notice of approval for
termination registration of the company from Suzhou Xiangcheng District Market
Supervision Administration. As of March 2019, it is no longer included in the consolidated
scope of the consolidated financial statements.
(2) Jiangsu Oubaosi International Trade Co., Ltd., the holding subsidiary, was liquidated
and terminated. On 3 January 2019, it obtained Notice of approval for termination
registration of the company from Nanjing Jiangbei New District Management Committee
Market Supervision Administration. As of February 2019, it is no longer included in the
consolidated scope of the consolidated financial statements.
(3) Jiangsu Yanghe Packaging Co., Ltd., the holding subsidiary, was liquidated and
terminated, and on 2 February 2019, it obtained Notice of approval for termination
registration of the company from Suqian Municipal Administration for Industry and
Commerce. As of March 2019, it is no longer included in the consolidated scope of the
consolidated financial statements.
(4) Dream Blue Haichuanhui (Shiyan) Trade and Investment Co., Ltd., the holding
subsidiary, was liquidated and terminated, and on 21 September 2019, it obtained the
Notice of approval for termination registration of the company from Shiyan Municipal
Administration Approval Bureau. As of October 2019, it is no longer included in the
consolidated scope of the consolidated financial statements.
(5) Xuzhou Huaqu Wine Development Co., Ltd., the holding subsidiary, was liquidated
and terminated, and on 24 October 2019, it obtained Notice of approval for termination
registration of the company from Xuzhou Market Supervision Administration. As of
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
November 2019, it is no longer included in the consolidated scope of the consolidated
financial statements.
2.2.7. Major changes in the business, products or services in the
reporting period
Applicable √ N/A
2.2.8. Main customers and suppliers
Sales to major customers of the Company
Total sales from top five customers（CNY） 950,082,213.94
Total sales from top five customers as a percentage of the total sales 4.11%
Total sales from related parties among top five customers as a
0.00%
percentage of the total sales
Information on top five customers
As a percentage of the total sales
No. Customer Sales amount(CNY)
for the year
1 Customer A 326,401,031.96 1.41%
2 Customer B 282,249,356.34 1.22%
3 Customer C 129,745,239.50 0.56%
4 Customer D 124,090,364.13 0.54%
5 Customer E 87,596,222.01 0.38%
Total -- 950,082,213.94 4.11%
Other information on major customers
Applicable √ N/A
Major suppliers of the Company
Total purchase from top five suppliers（CNY） 1,059,848,342.00
Total purchase from top five suppliers as a percentage of the total
18.00%
sales
Total purchase from related parties among top five suppliers as a
0.00%
percentage of the total purchase
Information on top five suppliers
As a percentage of the total
No. Supplier Purchases(CNY)
purchase for the year
1 Supplier A 317,383,746.97 5.39%
2 Supplier B 214,651,822.49 3.64%
3 Supplier C 207,918,354.69 3.53%
4 Supplier D 161,007,153.38 2.73%
5 Supplier E 158,887,264.47 2.71%
Total -- 1,059,848,342.00 18.00%
Other information on major suppliers
Applicable √ N/A
2.3. Expense
Unit：CNY
16
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Reason for any
2019 2018 YoY change
significant change
Selling and
distribution 2,691,711,170.59 2,561,401,628.22 5.09%
expenses
General and
administrative 1,856,491,727.00 1,704,265,102.61 8.93%
expenses
Finance expenses -78,426,551.41 -65,138,636.76 -20.40%
During this period, 7 raw
liquor production and
R&D projects were
registered by Suqian
R&D expenses 159,965,593.88 27,565,217.63 480.32% Municipal Science and
Technology Bureau,
resulting in a substantial
increase in the amount
of R&D expenses.
2.4. R&D input
√ Applicable N/A
During the reporting period, the Company has made outstanding achievements in
focusing on smart distilling, and the output and quality have reached the test goal. The
Company focused on the construction of distilling microecology and optimized the
directed aggregation of microorganisms. The Company developed a new mode of raw
liquor selection, grading and dynamic management. The Company reshaped the
mellowness architecture model, and deeply applied the core theory of mellowness
mechanism. The Company deeply subdivided the function of liquor body design to
construct a new liquor body design model. Further study on fermentation mechanism
helped the significant improvement of the mellowness quality.
During the reporting period, the Company won 5 science and technology awards above
the provincial level, 1 municipal patent first prize, and 3 invention patents.
Information about R&D input
2019 2018 YoY change
Number of R&D personnel 396 393 0.76%
R&D personnel as a percentage
2.51% 2.57% -0.06%
in total employees
R&D input(CNY) 166,917,025.32 32,880,110.63 407.65%
R&D input as a percentage in
0.72% 0.14% 0.58%
operating revenues
Capitalized R&D input(CNY) 6,951,431.44 5,314,893.00 30.79%
Capitalized R&D input
4.16% 16.16% -12.00%
percentage in total R&D input
Reasons for any significant YoY change in the ratio of the R&D input to the operating
revenues.
Applicable √ N/A
17
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Reasons for any sharp variation in the capitalization rate of R&D input and statement of
its rationale.
Applicable √ N/A
2.5. Cash flows
Unit：CNY
Item 2019 2018 YoY change
Subtotal of cash inflows from
28,418,153,682.08 29,598,814,116.52 -3.99%
operating activities
Subtotal of cash outflows
21,620,261,810.67 20,542,065,300.24 5.25%
from operating activities
Net cash flows from
6,797,891,871.41 9,056,748,816.28 -24.94%
operating activities
Subtotal of cash inflows from
40,698,105,842.28 35,262,332,061.45 15.42%
investing activities
Subtotal of cash outflows
41,991,320,976.18 38,611,674,185.80 8.75%
from investing activities
Net cash flows from
-1,293,215,133.90 -3,349,342,124.35 61.39%
investing activities
Subtotal of cash inflows from
1,500,000.00 -100.00%
financing activities
Subtotal of cash outflows
4,823,150,583.00 3,842,859,037.00 25.51%
from financing activities
Net cash flows from
-4,823,150,583.00 -3,841,359,037.00 -25.56%
financing activities
Net increase in cash and
684,796,540.70 1,865,395,431.79 -63.29%
cash equivalents
Explanation of why the data above varied significantly.
√ Applicable □ N/A
(1)The increase of 61.39% YoY of net cash flows from investing activities was mainly
because the increase in cash inflow from current investing activities was more than the
increase in cash outflow from investing activities, resulting in an increase in net cash flow
from current investment activities.
(2) The decrease of 100% YoY of net cash flows from financing activities was mainly due
to recovering letter of credit deposit during last period.
(3) The decrease of 63.29% YoY of net increase in cash and cash equivalent was mainly
due to a decrease in net cash flow from current operating activities and a decrease in net
cash flow from current financing activities.
Main reasons for the material difference between net cash flows from operating activities
during the reporting period and net profit for the year.
Applicable √ N/A
18
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
3. Analysis of non-core business
√ Applicable N/A
Unit：CNY
As a percentage
Amount Reasons Sustainability
of total profits
Mainly due to the investment
Investment
850,554,207.62 8.71% income generated by wealth No
income
management products
Mainly due to changes in fair
Changes in
158,679,505.33 1.62% value of financial assets held No
fair value
for trading
Asset Mainly due to provision for
-2,248,496.85 -0.02% No
impairment stock obsolescence
Mainly due to compensation
Non-operating
22,245,954.37 0.23% and liquidated damages No
income
income
Mainly due to losses from
Non-operating
13,324,291.70 0.14% retirement of fixed assets and No
expenses
donation expenses
4. Analysis of assets and liabilities
4.1 Significant changes of asset items
The Company implemented the new financial instrument standards, new revenue
standards or new leasing standards for the first time since 2019, and adjusted opening
balance of related items in financial reports due to the first implementation.
√ Applicable N/A
Unit：CNY
As at the end of 2019 As at the beginning of 2019 Explanati
Change
As a As a on about
in
percentage percentag any
Amount Amount percenta
of total e of total significant
ge
assets assets changes
Cash and cash
4,300,144,848.67 8.04% 3,615,348,307.97 7.23% 0.81%
equivalents
Accounts
16,080,618.65 0.03% 5,522,261.31 0.01% 0.02%
receivable
Inventories 14,433,244,696.27 27.00% 13,892,118,587.74 27.80% -0.80%
Long-term equity
25,361,651.38 0.05% 9,423,328.82 0.02% 0.03%
investments
Fixed assets 7,256,557,503.85 13.58% 7,833,665,282.19 15.68% -2.10%
Construction in
263,153,505.12 0.49% 154,535,104.82 0.31% 0.18%
progress
Long-term
72,723.00 109,088.00
borrowings
4.2 Assets and liabilities measured at fair value
√ Applicable □ N/A
Unit：CNY
19
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Changes
in the
Changes in
cumulati Provisi
fair value Other
Opening ve fair on for Amount of Amount of Closing
Item recognized change
balance value impair purchase sale balance
in profit or s
recorded ment
loss
into
equity
Financial
Asset
1. Financial
assets held
for
21,024,408, 158,679,505 41,652,461 39,807,93 23,027,61
trading(exclud
530.20 .33 ,609.88 0,764.80 8,880.61
ing derivative
financial
assets)
Subtotal of
21,024,408, 158,679,505 41,652,461 39,807,93 23,027,61
financial
530.20 .33 ,609.88 0,764.80 8,880.61
assets
21,024,408, 158,679,505 41,652,461 39,807,93 23,027,61
Total
530.20 .33 ,609.88 0,764.80 8,880.61
Financial
0.00 0.00 0.00 0.00 0.00
liabilities
Other changes
Whether measurement attribution of main assets changed significantly during this period.
Yes √ No
4.3 Restricted asset rights as of the end of this reporting period
No
5. Investment
5.1. Total investment
√ Applicable N/A
Investment made in the reporting period(CNY) Investment made in the prior year(CNY) YoY change
2,169,877,269.95 1,035,447,337.86 109.56%
5.2. Significant equity investment made in the reporting period
Applicable √ N/A
20
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
5.3. Significant non-equity investment ongoing in the reporting period
Applicable √ N/A
5.4. Financial assets at a fair value
√Applicable N/A
Unit：CNY
Changes in the
Changes in fair Accumulated
Category of Initial investment cumulative fair Amount of
value recognized Amount of sale investment Closing balance Capital source
securities cost value recorded purchase
in profit or loss income
into equity
Stock 425,350,132.53 46,958,683.88 0.00 0.00 0.00 9,374,806.02 331,714,847.11 Owned fund
Trust 10,528,393,516.12 133,962,200.00 0.00 10,252,307,330.00 9,676,955,130.00 476,422,000.00 10,575,352,200.00 Owned fund
Other 12,055,789,695.46 -22,241,378.55 0.00 31,400,154,279.88 30,140,906,746.23 369,248,567.53 12,120,551,833.50 Owned fund
Total 23,009,533,344.11 158,679,505.33 0.00 41,652,461,609.88 39,817,861,876.23 855,045,373.55 23,027,618,880.61 --
5.5. Use of fund-raising
Applicable √ N/A
No such cases in the reporting period.
6. Sale of major assets and equity Interests
6.1. Sale of major Assets
Applicable √ N/A
No such cases in the reporting period
21
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
6.2. Sale of major equity Interests
Applicable √ N/A
7. Analysis of major subsidiaries
√ Applicable N/A
Main subsidiaries and joint companies with an over 10% influence on the Company’s net profit
Unit：CNY
Company Registered
Company name Business scope Total assets Net assets Operating revenue Operating profit Net profit
type capital
Wholesaling and
Su Wine Trade Group
Subsidiary retailing of 334,400,000.00 21,099,601,221.40 4,684,024,774.74 21,974,534,074.41 5,003,782,622.22 3,819,274,583.70
Limited by Share Ltd.
prepackaged food
Jiangsu Shuanggou Production and sales
Subsidiary 110,000,000.00 5,804,851,247.65 2,145,629,216.48 1,738,636,631.76 1,741,537,881.85 1,775,995,802.91
Distillery Stock Co.,Ltd. of liquor
Wholesaling and
Jiangsu Shuanggou Liquor
Subsidiary retailing of 5,000,000.00 3,193,835,892.39 1,349,650,903.78 4,056,086,681.13 1,782,213,618.52 1,336,559,275.57
Operation Co.,Ltd.
prepackaged food
Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □ N/A
How subsidiary was acquired or disposed Impact on overall operation and
Subsidiary name
during the reporting period results(CNY)
Yanghe Hong Kong Distillery Co., Ltd. Establishment Tiny
Jiangsu Guanmeng Information Technology Co., Ltd. Liquidation and cancellation Tiny
Jiangsu Oubaosi International Trade Co., Ltd. Liquidation and cancellation Tiny
Jiangsu Yanghe Packaging Co., Ltd. Liquidation and cancellation Tiny
Dream Blue Haichuanhui (Shiyan) Trade and Investment Co., Ltd. Liquidation and cancellation Tiny
Xuzhou Huaqu Wine Development Co., Ltd. Liquidation and cancellation Tiny
22
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
8. Structured entities controlled by the Company
□ Applicable √ N/A
9. Outlook for the future development of the Company
9.1. Analysis of industry situation
First, the liquor industry is developing well. In 2019, benefiting from consumption upgrade
and the transformation of consumption structure, liquor industry revenue and profit
maintained steady growth, with profit growth outpacing revenue growth. In 2019, the
sales revenue of above-sized liquor enterprises in China reached CNY 561.782 billion,
up 8.24% year on year. The total profit before taxes reached CNY 140.409 billion, up
14.54% year on year. In the future, with the increase in the volume and price of high-end
and secondary high-end segment and the rise of the middle class, the liquor industry is
expected to further enjoy the benefits of consumption upgrade.
Second, the landscape of liquor industry is gradually forming. In 2019, the competition of
liquor industry became more intensified and developed into extrusion-type. Famous
liquor enterprises continuously strengthened their competitive advantages in aspects of
product, brand, channel and market. In each of high-end, secondary high-end, middle-
end or low-end liquor segments, representative brands in each mainstream price range
have gradually emerged. The industry structure and competition landscape have been
gradually formed, and such situations could be further strengthened in future market
competition.
Third, industry differentiation accelerated and the Matthew effect has been more evident.
In the first three quarters of 2019, the revenue growth rate of 19 listed liquor enterprises
was 17%, 7 percentage higher than the overall growth rate of the industry, and the
revenue was further concentrated among major enterprises. With the increasing
concentration of liquor industry, leading and famous enterprises with advantages in
capital, management, brand, talent and channel are expected to capture more shares in
the future market competition.
9.2. Future development strategy and next business plan
(1)Future development strategy
In 2020, the Company will continue to adhere to the "Wu Du Wu Mi" strategy, and try to
become a company that understands liquor, brews liquor, and sells liquor the best in the
industry, and a most focused, most professional, and most far-sighted liquor company.
The more long-term development goal is to make the Company a leading enterprise that
can perform well constantly through the life cycle.
(2)2020 business plan
23
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
In 2020, facing the complex external environment and increasingly fierce competition
situation, the Company will implement “12633” work plan, namely focusing on "one goal",
inspiring "second entrepreneurship", upgrading "six forces", winning "three major battles",
and strengthening "three guarantees". In a decisive battle, the Company will win the
battle of transformation and embark on a new journey of high-quality development in a
better era.
A. Focusing on “one goal”. 2020 is a critical year for the Company's adjustment and
transformation. Affected by the epidemic, the Company will make every effort to minimize
the impact of the epidemic, and strive to maintain a flat revenue level in 2020.
B. Inspiring "second entrepreneurship". The first is to adhere to strategic thinking. The
Company will focus on the big picture, prioritize the overall situation, pay attention to the
key points, and raise the "second entrepreneurship" to the strategic height of the overall
situation and development of the enterprise. The second is to stick to long-term thinking.
The Company will adhere to the consumer-oriented sense of mission, adhere to the
people-oriented value concept, adhere to craftsmanship spirit of pursuit of excellence,
and commit to making a better life for long term. The third is to adhere to responsibility
thinking. The Company not only achieves business value, but also contributes to the
environment, responsibility and the safety and healthy development of employees,
reflecting the responsibility of the enterprise. The fourth is to adhere to ecological thinking.
From the logic of competition to the logic of symbiosis, the Company will create
enterprise ecology, do a good job in cooperation, eliminate the information island, and
constantly enhance the co-construction and symbiosis among enterprises, consumers,
distributors, suppliers, media and capital markets.
C. Upgrading "six forces". The first is to focus on the characteristics of the times, and
upgrade the unique product power. The second is to focus on consumer sovereignty, and
upgrade the outstanding brand power directly into the people's hearts. The third is to
focus on digital empowerment and upgrade the ultimate channel power that helps win in
the market. The Fourth is to focus on transformation, development, upgrade and the
continuous innovation power. The fifth is to focus on the adjustment mechanism, and
upgrade promising organization power. The sixth is to focus on patriotism, and upgrade
the era of cultural power to pursue the dream.
D. Winning "three major battles". Resolutely win the "three battles" of marketing
transformation, quality breakthrough and management upgrading: first, based on long-
term thinking, comprehensive measures, precise force, the Company will resolutely win
the battle of marketing transformation. The second is to focus on mellowness. The
Company will spare no effort at all costs to resolutely win the quality breakthrough battle.
The third is to improve the quality and efficiency. It needs all hands on deck to resolutely
win the battle of management and upgrading.
E. Strengthening "three guarantees". To provide the guarantee of success for enterprise
transformation: The first is to provide the political guarantee for success with the
guidance of party construction; The second is that the innovation of mechanism provides
the organization guarantee for success. The third is that cultural remolding provides the
ideological guarantee for success.
(3)Possible risks
24
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
First is the risk of macroeconomic uncertainties. From a global point of view, world
economic growth continues to slow down and international economic environment is
unpredictable. From a domestic point of view, China is now in the crucial period of
transforming the growth model, optimizing the economic structure and transforming the
growth drivers. Structural, institutional and cyclical problems are intertwined, and
downward pressure on the economy is mounting.
Second is the risk of intensified market competition. The main competitive enterprises
pay more attentions to marketing, increase investment intensity, strengthen channel
construction, further develop the terminal ends, and further optimize the product mix.
Competitive enterprises maintain rapid growth and market competition becomes more
intense.
Third, the epidemic affected the sector-wise sales of liquor. The recent domestic and
international COVID-19 outbreak has affected the global economic development trend to
a certain extent, and then affected the sales of liquor sector periodically.
10. Visits paid to the Company for research, communication,
interview, etc.
10.1 Activity register in the reporting period
√ Applicable N/A
Date of visit Way of visit Type of visitor Index to main inquiry information
Log Sheet of Investor Relations
Activities for 15 February 2019 on
15 February 2019 Field survey Institution www.cninfo.com.cn（No：2019-
001）
Log Sheet of Investor Relations
Activities for 8 May 2019 on
8 May 2019 Field survey Institution www.cninfo.com.cn（No：2019-
002）
Log Sheet of Investor Relations
Activities for 10 May 2019 on
10 May 2019 Other Other www.cninfo.com.cn（No：2019-
003）
Log Sheet of Investor Relations
Activities for 23 May 2019 on
23 May 2019 Field survey Other www.cninfo.com.cn（No：2019-
004）
Log Sheet of Investor Relations
Activities for 20 June 2019 on
20 June 2019 Field survey Institution www.cninfo.com.cn（No：2019-
005）
17 July 2019 Field survey Institution Log Sheet of Investor Relations
25
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Date of visit Way of visit Type of visitor Index to main inquiry information
Activities for 17 July 2019 on
www.cninfo.com.cn（No：2019-
006）
Log Sheet of Investor Relations
Activities for 19 July 2019 on
19 July 2019 Field survey Institution www.cninfo.com.cn（No：2019-
007）
Log Sheet of Investor Relations
Activities for 30 July 2019 on
30 July 2019 Field survey Institution www.cninfo.com.cn（No：2019-
008）
Log Sheet of Investor Relations
Activities for 18 September
2019，19 September 2019 on
18 September 2019 Field survey Institution
www.cninfo.com.cn（No：2019-
009）
Log Sheet of Investor Relations
Activities for 19 September
2019,19 September 2019 on
19 September 2019 Field survey Institution
www.cninfo.com.cn（No：2019-
009）
Log Sheet of Investor Relations
Activities for 29 October 2019，
Telephone 30 October 2019 on
29 October 2019 Institution
communication
www.cninfo.com.cn（No：2019-
010）
Log Sheet of Investor Relations
Activities for 30 October 2019，
Telephone 30 October 2019 on
30 October 2019 Institution
communication
www.cninfo.com.cn（No：2019-
010）
26
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section V Significant Events
1. Profit distribution and converting capital reserves into
share capital for common shareholders
Profit distribution policy for common stock during this period, especially formulation,
execution or adjustments of cash dividend policy.
√ Applicable N/A
On 23 May 2019, the Company held 2018 annual shareholders' meeting, and the plan for
profit distribution for 2018 was reviewed and approved by this meeting. Plan for profit
distribution: Based on its total of 1,506.988 million shares as on 31 December 2018, the
Company distributed a cash dividend of CNY 32 (tax inclusive) per 10 shares. The total
cash dividend is CNY 4,822.3616 million (tax inclusive).
A special statement of cash dividend policy
Whether it meets the requirements of the articles
of incorporation or the resolution of shareholders' Yes
meeting.
Whether the standard and proportion of dividends
Yes
are definite and clear.
Whether the relevant decision-making process and
Yes
system are complete.
Whether non-executive directors perform their
Yes
duties and play their due role.
Whether the minority shareholders have the
opportunity to fully express their opinions and
Yes
appeals and whether their legitimate rights and
interests have been adequately protected.
Whether the conditions and procedures are
The Company's cash dividend policy
compliant and transparent it the cash dividend
has not been adjusted or changed.
policy is adjusted or changed.
Plans (or preliminary plans) for profit distribution and converting capital reserves into
share capital for common shareholders for the recent three years (including the reporting
period) are as following:
2019: The Company intends to distribute a cash dividend of CNY 30 (tax included) per 10
shares to all shareholders with undistributed profits on the basis of the share capital
participating in the dividend on the registration date when the profit distribution plan is
implemented in the future. There is no bonus shares and reserves would not be
converted into share capital. According to the implementation rules of the repurchase of
shares of listed companies in Shenzhen Stock Exchange, the repurchase shares held in
the special securities account of the repurchase of shares of listed companies are not
entitled to the rights of profit distribution, fund transferred to increase share capital, rights
issue, etc. Assuming the Company's total share capital of 1,506,988,000 shares as at 31
December 2019, and excluding 1,500,995,897 shares of 5,992,103 shares in the
Company's special securities account for share repurchase as at 28 April 2020 (the date
when the board of directors reviewed and adopted the profit distribution plan), the
27
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Company is expected to distribute a cash dividend of no more than CNY 4,502,987,691
(tax included) in the current year.
2018: Based on its total of 1,506.988 million shares as at 31 December 2018, the
Company is to distribute a cash dividend of CNY 32 (tax inclusive) per 10 shares. The
total cash dividend is CNY 4,822.3616 million (tax inclusive). The registration date was
26 June 2019 and the ex-right & ex-dividend day was 27 June 2019.
2017: Based on its total of 1,506.988 million shares as at 31 December 2017, the
Company is to distribute a cash dividend of CNY 25.5 (tax inclusive) per 10 shares. The
total cash dividend is CNY 3,842.8194 million (tax inclusive). The registration date was
21 June 2018 and the ex-right & ex-dividend day was 22 June 2018.
Cash dividend distribution over the recent three years (including the reporting period)
Unit: CNY
Ratio to net
Net profit profit Cash
Ratio of
attributable to attributable dividends
Ratio of cash
in other Total cash
common to common cash dividends
forms dividends
Year Cash dividends shareholders in shareholder dividends (including
(tax inclusive) (e.g. (including other
in other other
the consolidated s in the share forms)
forms forms)
statement in the consolidated repurchas
year statement in e)
the year
4,502,987,691. 4,502,987,691.
2019 7,382,822,726.87 60.99% 0.00 0.00% 60.99%
00 00
4,822,361,600. 4,822,361,600.
2018 8,115,189,794.69 59.42% 0.00 0.00% 59.42%
00 00
3,842,819,400. 3,842,819,400.
2017 6,627,169,959.16 57.99% 0.00 0.00% 57.99%
00 00
The Company made a profit in the reporting period and the profit distributed to common
shareholders of the parent company was positive, but it did not put forward a preliminary
plan for cash dividend distribution to its common shareholders.
Applicable √ N/A
2. Plan for profit distribution and converting capital reserves
into share capital for the reporting period
√ Applicable N/A
Bonus shares for every 10 shares (share) 0
Dividend for every 10 shares (CNY) (tax 30
included)
Shares converted from capital reserves for 0
every 10 shares (share)
Total shares as the basis for the preliminary
1,500,995,897
plan for profit distribution (share)
Total cash dividends (CNY) (tax inclusive) 4,502,987,691.00
Cash dividends in other forms (e.g. share 0.00
28
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
repurchase)
Total cash dividends (CNY) (including other
4,502,987,691.00
forms)
Distributable profit (CNY) 24,556,878,616.62
Percentage of cash dividends in the total
100%
distributed profit (including other forms)
Information about cash dividends
The development stage of the Company is mature and the Company has no major fund expenditure
arrangement. When the profit distribution is carried out, the proportion of cash dividends in this profit
distribution should at least reach 80%.
Details about the preliminary plan for profit distribution and converting capital reserves into share
capital
As audited by Suya Jincheng CPA LLP, the Company realized a net profit of CNY 7,206,965,587.70 for
2019. It provided CNY 0 as statutory surplus reserves, plus undistributed profit at the beginning of the
year of CNY 22,172,274,628.92 and minus the distributed profit of CNY 4,822,361,600, the actual
distributable profit would be CNY 24,556,878,616.62.
In line with both the long-term development needs of the Company and the principle of giving
appropriate returns to shareholders, the Company intends to distribute a cash dividend of CNY 30 (tax
included) per 10 shares to all shareholders with undistributed profits on the basis of the share capital
participating in the dividend on the registration date when the profit distribution plan is implemented in
the future. There is no bonus shares and reserves would not be converted into share capital. The profit
distribution conforms to the cash dividend policy stipulated in the articles of association.
According to the implementation rules of the repurchase of shares of listed companies in Shenzhen
Stock Exchange, the repurchase shares held in the special securities account of the repurchase of
shares of listed companies are not entitled to the rights of profit distribution, fund transferred to
increase share capital, rights issue, etc. Assuming the Company's total share capital of 1,506,988,000
shares as at 31 December 2019, and excluding 1,500,995,897 shares of 5,992,103 shares in the
Company's special securities account for share repurchase as at 28 April 2020 (the date when the
board of directors reviewed and adopted the profit distribution plan), the Company is expected to
distribute a cash dividend of no more than CNY 4,502,987,691 (tax included) in the current year.
3. Performance of undertakings
3.1. Undertakings of the Company's actual controller, shareholders,
related parties and acquirer, as well as the Company and other
commitment makers fulfilled during the reporting period or ongoing at
the end of this period
√ Applicable N/A
Degree
Undertaking Type of Undertaki of
Undertaking Details of undertaking Term
giver undertaking ng date perfor
mance
Stock reform
undertaking
Undertaking made in
the report of acquisition
or change of interest
Undertaking made in
the reorganization of
assets
Horizontal com 1. The commitment to
Undertakings given in petition, related avoid horizontal competitio
Jiangsu
transactions n: 26 August Long- In
time of IPO or Yanghe Group
and capital (1) At present, the 2009 term progress
refinancing Co.,Ltd.
occupation Company has not engaged
in the business of
29
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Degree
Undertaking Type of Undertaki of
Undertaking Details of undertaking Term
giver undertaking ng date perfor
mance
competing with the joint
stock company. The
Company is committed to
maintaining the existing
business structure and does
not directly or indirectly
operate any business that
competes with the actual
operation of the joint stock
company or may constitute
a competition, or a
subsidiary or subsidiary
enterprise that is engaged
in the above business.
(2) If the Company violates
the above commitments,
the joint stock company has
the right to require the
company to immediately
terminate its business
competition and to
compensate for the
economic losses caused to
the joint stock company. At
the same time, the
Company should pay
liquidated damages to the
joint stock company for
CNY 10 million.
(3) The Company has
committed itself to the
legitimate rights and
interests of the
shareholders of joint stock
companies, other
shareholders of joint stock
companies and the
creditors of joint stock
companies without the use
of their holding shareholder
status in the joint stock
company.
(4) This undertaking shall
enter into force on the date
of signing, and shall not be
revoked without the consent
of the stock company.
2. The commitment to
reduce the related
transactions: the Company
will strictly follow the
requirements of the relevant
laws as Corporation Law,
Securities Law and Code of
Corporate Governance for
Listed Companies, and
further reduce and strictly
standardize the various
related transactions
between the Company and
the joint stock companies,
so as to ensure that the
controlling shareholders
and the actual control are
30
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Degree
Undertaking Type of Undertaki of
Undertaking Details of undertaking Term
giver undertaking ng date perfor
mance
not used. The status of
making a person damages
the interests of the
shareholders of a joint stock
company and other
shareholders and does not
occur in the case of new
share holding companies.
The commitment to avoid
horizontal competition:
1. The Company is mainly
engaged in investment
management and does not
operate the same or
associated business with
the issuer. The Company
In
will not engage in the
progress
business of the same or
.
associated business with
Blue
the issuer, without prejudice
Alliance
to the interests of the
merged
issuer, nor from the issuer
Blue Sky
for unfair interests.
Horizontal com Trade
2. If the Company violates
Jiangsu Blue petition, related 23 and Blue
the above commitment, the Long-
Alliance Joint- transactions November Ocean
issuer has the right to claim term
Stock Co., Ltd. and capital 2017 Trade.
compensation for the
occupation Blue
economic loss resulting
Alliance
from the issuer, and to pay
carries
a liquidated penalty of CNY
on
5 million, and the right to
relevant
purchase the business item
commitm
at the market price of the
ents
business item or the
establishment of a cost
price (which is the principle
of the lowest value).3. This
undertaking shall enter into
force on the date of signing,
and shall not be revoked
without the consent of the
issuer.
In
progress
，Blue
Alliance
After a year of trading in the merged
stock exchange, the shares Blue Sky
of the issuer will not exceed Trade
Jiangsu Blue 25% of the total number of 23
Long- and Blue
Alliance Joint- Share reduction shares held by the issuer, November
term Ocean
Stock Co., Ltd. and the issuer's shares and 2017 Trade.
changes in the shares are Blue
declared to the issuer in a Alliance
timely manner. Carries
on
relevant
commitm
ents
Shareholders of Blue Sky
Trade,as directors, 23
Feng Pantai, Other Long- In
supervisors and senior November
Cong Xuenian undertaking term progress
managers, made the 2017
commitment:
31
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Degree
Undertaking Type of Undertaki of
Undertaking Details of undertaking Term
giver undertaking ng date perfor
mance
1. During the tenure of the
issuer, Blue Sky Trade
equity transferred annually
shall not exceed 25% of the
total number of shares held
by Blue Sky Trade。
2. If I leave the issuer, I will
not transfer the shares of
Blue Sky Trade that I have
held within six months after
my departure.
3. If I leave from the issuer,
the number of Blue Sky
transferred shares trade
within twelve months after
six months of departure
does not exceed 50% of the
total share of Blue Sky
Trade.
Shareholders of Blue
Ocean Trade,as directors,
supervisors and senior
managers, made the
commitment:
1. During the tenure of the
issuer, Blue Ocean Trade
equity transferred annually
shall not exceed 25% of the
total number of shares held
by Blue Ocean Trade
23 23
Other 2. If I leave the issuer, I will
Zhong Yuye November March Finish
undertaking not transfer the shares of
2017 2019
Blue Ocean Trade that I
have held within six months
after my departure.
3. If I leave from the issuer,
the number of Blue Ocean
transferred shares trade
within twelve months after
six months of departure
does not exceed 50% of the
total share of Blue Ocean
Trade.
Equity incentive
undertaking
Other undertakings to
non-controlling
shareholders
Whether the undertaking
Yes
is fulfilled on time
If the undertaking is
overdue and not fulfilled,
specific reasons for
N/A
failing to fulfill any
undertakings and plan
for the next step
3.2. Where any earnings forecast was made for any of the Company's
assets or projects and the reporting period is still within the forecast
32
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
period, the Company shall explain whether the performance of the asset
or project reaches the earnings forecast and why
Applicable √ N/A
4. Occupation of the Company's capital by the controlling
shareholder or its related parties for non-operating purposes
Applicable √ N/A
No such cases in the reporting period.
5. Explanation of the board of directors, the supervisory
committee and non-executive directors (if any) regarding the
"non-standard audit opinion" for the reporting period
Applicable √ N/A
6. Reasons for changes in accounting policies, accounting
estimates and accounting methods as compared to the
financial report for the prior year
√ Applicable N/A
Since 1 January 2019, the Company has implemented the revised by Ministry of Finance
in 2017: the Accounting Standards for Business Enterprises No. 22 -Recognition and
Measurement of Financial Instruments, the Accounting Standards for Business
Enterprises No. 23 –Transfer of Financial Assets, the Accounting Standards for Business
Enterprises No. 24 – Hedge Accounting, and the Accounting Standards for Business
Enterprises No. 37 – Financial Instruments Presentation (Hereinafter referred to as the
“new financial instrument standards”). According to the requirements of the new financial
instrument standards, the Company presents the relevant information of financial
instruments without retroactively adjusting the comparative financial statements. This
accounting policy change has been reviewed and approved by the sixth meeting of the
sixth board of directors.
7. Reasons for retrospective restatement of major accounting
errors during the reporting period
Applicable √ N/A
No such cases in the reporting period.
8. Reasons for changes in scope of the consolidated financial
statements as compared to the financial report for the prior
year
33
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
√ Applicable N/A
8.1 Establishment of subsidiaries
In September 2018, the Company registered and established Yanghe Hong Kong
Distillery Co., Ltd. in Hong Kong, which was invested in October 2019 and included in the
consolidated financial statements from October 2019.
8.2 Cancellation of subsidiaries
(2) Jiangsu Guanmeng Information Technology Co., Ltd., the holding subsidiary, was
liquidated and cancelled, and on 12 February 2019, it obtained Notice of approval for
cancellation registration of the company from Suzhou Xiangcheng District Market
Supervision Administration. As of March 2019, it is no longer included in the consolidated
scope of the consolidated financial statements.
(2) Jiangsu Oubaosi International Trade Co., Ltd., the holding subsidiary, was liquidated
and cancelled. On 3 January 2019, it obtained Notice of approval for cancellation
registration of the company from Nanjing Jiangbei New District Management Committee
Market Supervision Administration. As of February 2019, it is no longer included in the
consolidated scope of the consolidated financial statements.
(6) Jiangsu Yanghe Packaging Co., Ltd., the holding subsidiary, was liquidated and
cancelled, and on 2 February 2019, it obtained Notice of approval for cancellation
registration of the company from Suqian Municipal Administration for Industry and
Commerce. As of March 2019, it is no longer included in the consolidated scope of the
consolidated financial statements.
(7) Dream Blue Haichuanhui (Shiyan) Trade and Investment Co., Ltd., the holding
subsidiary, was liquidated and cancelled, and on 21 September 2019, it obtained Notice
of approval for cancellation registration of the company from Shiyan Municipal
Administration Approval Bureau. As of October 2019, it is no longer included in the
consolidated scope of the consolidated financial statements.
(8) Xuzhou Huaqu Wine Development Co., Ltd., the holding subsidiary, was liquidated
and cancelled, and on 24 October 2019, it obtained Notice of approval for cancellation
registration of the company from Xuzhou Market Supervision Administration. As of
November 2019, it is no longer included in the consolidated scope of the consolidated
financial statements.
9. Engagement and disengagement of accounting firm
Accounting firm at present
Name of the domestic accounting firm Suyajincheng CPA LLP
Remuneration for the domestic accounting 190.8
firm (CNY ’0,000)
34
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Consecutive years of the audit service 13
provided by the domestic accounting firm
Names of the certified public accountants Kan Baoyong, Li Yan
from the domestic accounting firm
Consecutive years of the audit service
provided by the certified public Kan Baoyong (3 years), Li Yan (1 years)
accountants
Whether the accounting firm was changed in the current period.
Yes √ No
Engagement of any accounting firm for internal control audit, financial adviser or sponsor
√ Applicable N/A
This year, the Company hired Suyajincheng CPA LLP as the Company's internal control
audit accounting firm. The total of CNY 530,000 of internal control audit fees were paid
during the period.
10. Possibility of listing suspension and termination after
disclosure of this annual report
Applicable √ N/A
11. Bankruptcy and reorganization
Applicable √ N/A
No such cases in the reporting period.
12. Material litigation and arbitration
Applicable √ N/A
No such cases in the reporting period.
13. Punishments and rectifications
Applicable √ N/A
No such cases in the reporting period.
14. Credit conditions of the company as well as its controlling
shareholder and actual controller
Applicable √ N/A
15. Implementation of any equity incentive plan, employee
stock ownership plan or other incentive measures for
employees
Applicable √ N/A
35
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
16. Significant related-party transactions
16.1. Related-party transactions arising from routine operation
Applicable √ N/A
No such cases in the reporting period.
16.2. Related-party transactions regarding purchase or sales of assets
or equity interests
Applicable √ N/A
No such cases in the reporting period.
16.3. Related-party transactions arising from joint investments in
external parties
Applicable √ N/A
No such cases in the reporting period.
16.4. Credits and liabilities with related parties
√ Applicable □N/A
There are no non-operational related creditor's rights and debt transactions.
16.5. Other significant related-party transactions
Applicable √ N/A
No such cases in the reporting period.
17. Significant contracts and their execution
17.1. Trusteeship, contracting and leasing
17.1.1. Trusteeship
Applicable √ N/A
No such cases in the reporting period.
17.1.2. Contracting
Applicable √ N/A
No such cases in the reporting period.
17.1.3. Leasing
Applicable √ N/A
No such cases in the reporting period.
17.2. Major guarantees
Applicable √ N/A
No such cases in the reporting period.
36
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
17.3. Entrusted cash assets management
17.3.1. Entrust finance management
√ Applicable N/A
Entrust finance in the reporting period.
Unit: CNY 10, 000
Overdue
Source of Undue closing
Product type Amount outstanding
entrust finance balance
amount
Bank finance Owned Fund 786,300 786,300 0
Trust finance Owned Fund 1,044,139 1,044,139 0
Broker finance Owned Fund 5,000 5,000 0
Other Owned Fund 15,000 0 0
Total 1,850,439 1,835,439 0
37
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Information about significant amount of individual entrust finance or high-risk entrust finance with principle nonguaranteed and poor liquidity.
√ Applicable N/A
Unit： CNY 10,000
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
trustee type
Product type Amount
funding ment date on date allocation Remun
annualized earnings（if
loss for the recovered
impairment
statutory finance （if
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
It is used to
pay the
transfer price
of the gain
right of the
specific assets
held by
Guangzhou
Wanda Culture
and Tourism
City
Investment
Zhongrong -
Zhongrong Co., Ltd., and
Chengan
Internation 15 March 15 March the fund will
Trust No.26 13,000 Owned fund Cash 8.70% 2,265.1 901.7 365.64 0 Yes Yes
al Trust 2019 2021 eventually be
Collective Fund
Co.,Ltd. used for the
Trust Plan
development
and
construction of
the C3 block of
Guangzhou
Sunac Wanda
City (located in
the
government
block of Huadu
District in
Guangzhou)
Jiangsu Jiangsu Trust- 26 April 26 It is used for
Trust 5,000 Owned fund Cash 9.00% 676.85 306.99 225.66 0 Yes Yes
Internation Sunac No.26 2019 October issuing loans
38
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
al Trust Collective Fund 2020 to Qingdao
Co.,Ltd. Trust Plan Wanda
Oriental Film
Capital
Investment
Co., Ltd., and it
is used for
construction of
A-4-3
residential
project of
starlight island
which is the
core zone of
Qingdao west
coast new
district
It is used for
issuing trust
loans to
Chengdu
Yulong No. 1
Avic Trust - Real Estate
Apocalypse Development
[2019] No.106 Co., Ltd., and
Avic Trust 21 June 20 June
Trust Evergrande 20,000 Owned fund the fund is Cash 8.50% 1,700 898.9 847.67 0 Yes Yes
Co.,Ltd. 2019 2020
Chengdu used for the
Collective Fund expenses
Trust Plan related to the
development
and
construction of
Evergrande
Chengdu
39
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Yulong
Tianfeng
project (Phase
I and Phase II)
It is used to
acquire the
gain right of
China Foreign specific asset
China Economy and of Evergrande
Foreign Trade Trust- Guiyang New
Economy Fuxiang No.157 28 June 28 June World 3A-4D
Trust 12,000 Owned fund Cash 8.50% 1,022.79 519.78 489.28 0 Yes Yes
and Trade Evergrande 2019 2020 block project,
Trust Co., New World and obtain the
Ltd. Collective Fund investment
Trust Plan income by
investing the
gain right of
specific asset
It is used for
investment in
bank deposit,
inter-bank
Avic Trust -
lending, bond
Apocalypse
reverse
No.556
Avic Trust 9 June repurchase,
Trust Tiancheng Jufu 50,000 Owned fund 9 July 2019 Cash 7.50% 3,452.05 1,797.95 0 0 Yes Yes
Co.,Ltd. 2020 money market
Investment
fund, bond
Collective Fund
fund,
Trust Plan
exchange and
inter-bank
market bond,
etc.
Avic Trust Avic Trust- 17 July 17 It is used to
Trust 18,000 Owned fund Cash 8.90% 2,413.97 732.97 684.69 0 Yes Yes
Co.,Ltd. Tianxin bay 2019 January subscribe for
40
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
area upgrade 2021 convertible
No.2 Collective bonds issued
Fund Trust by Shenzhen
Plan Gangdi
Industrial Co.,
Ltd.in Qianhai
equity trading
center.
The
convertible
bond
[2019006] is
eventually
used to pay
for demolition
fee of renewal
of east area in
Anhua
industrial zone,
the repayment
of partial
shareholders'
loan and the
daily
management
expenses.
It is used to
Zhongrong transfer the
Zhongrong
Trust- Shengshi equity
Internation 30 July 29 July
Trust Zunjue No.15 10,000 Owned fund proceeds of Cash 8.20% 820 345.97 0 0 Yes Yes
al Trust 2019 2020
Collective Fund 100% shares
Co.,Ltd.
Trust Plan(A9) of Wanda
Lanzhou City
41
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Development
Co., Ltd held
by Wanda
Group Co.,
Ltd.
It is used to
transfer the
equity
proceeds of
Zhongrong
Zhongrong 100% shares
Trust- Shengshi 30
Internation 30 July of Wanda
Trust Zunjue No.15 10,000 Owned fund January Cash 8.40% 1,265.75 354.41 0 0 Yes Yes
al Trust 2019 Lanzhou City
Collective Fund 2021
Co.,Ltd. Development
Trust Plan(B9)
Co., Ltd held
by Wanda
Group Co.,
Ltd.
It is used for
issuing trust
loans to
Kaifeng New
District
Infrastructure
Construction
CITIC CCITIC Trust 31 Investment
31 July
Trust Trust Collective Fund 2,000 Owned fund October Co., Ltd., and Cash 8.30% 208.3 69.58 0 0 Yes Yes
2019
Co.,Ltd, Trust Plan 2020 the fund is
eventually
used for
supporting
facilities
project of west
lake tourist
scenic spot in
42
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Kaifeng new
district.
It is used to
acquire 49%
MinSheng equity of
Trust- Zhixin Beijing Zhende
China No.618 Xingyun
25
MinSheng Sunshine City 1 August Property Co.,
Trust 20,000 Owned fund Decembe Cash 8.90% 2,531.56 751.56 697.17 0 Yes Yes
Trust Co., Beijing Equity 2019 Ltd. via capital
r 2020
Ltd Investment investment and
Collective Fund issue trust
Trust Plan loans to the
project
company
It is used for
issuing loans
to Shenzhen
Jushenghua
Co., Ltd. for
Avic Trust- supplement of
Apocalypse[20 liquidity fund
Avic Trust 18]No.561 2 August 1 August gap;It is also
Trust 16,000 Owned fund Cash 9.40% 3,008 622.2 576.88 0 Yes Yes
Co.,Ltd. Huabao No.1 2019 2021 used to pay
Collective Fund the
Trust Plan construction
fee of
Guangzhou
airport high-
end storage
project
China MinSheng It is used for
MinSheng Trust- Zhixin 6 August 5 July repayment of
Trust 10,000 Owned fund Cash 9.10% 1,742.71 366.49 0 0 Yes Yes
Trust Co., No.491 Kaisa 2019 2021 shareholder
Ltd City Upgrade loans and the
43
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Collective Fund development
Trust Plan and
construction by
subsidiaries of
Kaisa Real
Estate
(Shanghai)
Co., Ltd.
It is used for
issuing trust
loans to
Evergrande
China Foreign
Real Estate
Economy and
China Group Shanxi
Trade Trust-
Foreign Co., Ltd., and it
Furong No.158 9
Economy 9 August is used for the
Trust Taiyuan 15,000 Owned fund February Cash 8.50% 1,921.23 503.01 464.59 0 Yes Yes
and Trade 2019 development
Evergrande 2021
Trust Co., and
Jinbi Tianxia
Ltd. construction of
Collective Fund
Taiyuan
Trust Plan
Evergrande
Jinbi Tianxia
project (Phase
I)
It is used for
MinSheng daily working
Trust- Zhixin capital needs
China No.651 and financial
15
MinSheng Baoenng 15 August institution
Trust 10,000 Owned fund August Cash 8.70% 872.38 328.93 314.63 0 Yes Yes
Trust Co., Investment 2019 financing
2020
Ltd Trust Loan formed by the
Collective Fund supplement of
Trust Plan daily working
capital of
44
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Shenzhen
Baoneng
Investment
Group Co., Ltd
and its
subsidiaries
Huatai
Securities
20
Huatai Huanyi 22 August Non-fixed
Broker 5,000 Owned fund August Cash 5.10% 254.3 91.25 0 0 Yes Yes
Securities No.19066 2019 income
2020
beneficiary
certificate
It is used to
issue trust
loans to Putian
Avic Hengsheng
Trust.Apocalyp Real Estate
se Co., Ltd. The
[2018]No.126 trust loans are
28
Avic Trust Evergrande 29 August used for
Trust 10,000 Owned fund August Cash 8.00% 800 212.78 0 0 Yes Yes
Co.,Ltd. Fujian Real 2019 repayment of
2020
Estate the
Investment development
Collective Fund and
Trust Plan construction
loans invested
by its
shareholders
CITIC Trust- It is used for
Jiahe No.154 issuing trust
CITIC 28
Evergrande 29 August loans to
Trust Trust 20,000 Owned fund February Cash 8.20% 2,466.74 557.15 512.41 0 Yes Yes
Guiyang 2019 Guiyang
Co.,Ltd, 2021
Zhongyu Loan Zhongyu Real
Collective Fund Estate
45
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Trust Plan Development
Co., Ltd., and
for the
development
and
construction of
the central
park BE block
and central
square ACD
block under
the name of
Guiyang
Zhongyu
It is used for
issuing trust
loans to
Suzhou
Wuxiang
Property Co.,
Ltd., and it is
eventually
Chongqing
used for the
Chongqing Trust- Gusu 23
30 August development
Trust Trust No.2 Collective 10.000 Owned fund August Cash 7.80% 767.18 262.85 239.34 0 Yes Yes
2019 and
Co.,Ltd. Fund Trust 2020
construction of
Plan (Phase IV)
Block 59,
South
Changnan
Road and East
Wuxing Road,
Suxiang
Cooperation
zone,
46
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Xiangcheng
District,
Suzhou city,
Jiangsu
province, and
repayment of
shareholders’
loans
It is used for
issuing trust
loans to
Suzhou
Wuxiang
Property Co.,
Ltd., and it is
eventually
used for the
development
and
Chongqing
construction of
Chongqing Trust- Gusu 23
30 August Block 59,
Trust Trust No.2 Collective 10.000 Owned fund August Cash 8.00% 1,586.85 269.59 245.48 0 Yes Yes
2019 South
Co.,Ltd. Fund Trust 2021
Changnan
Plan (Phase V)
Road and East
Wuxing Road,
Suxiang
Cooperation
zone,
Xiangcheng
District,
Suzhou city,
Jiangsu
province, and
repayment of
47
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
shareholders’
loans
It is used for
issuing trust
loans to Beijing
Fuhua Real
Estate
CITIC Trust-
Development
Beijing
CITIC 3 2 Co., Ltd., and
Evergrande
Trust Trust 5,000 Owned fund September Septemb for the follow- Cash 7.90% 395 128.78 118.50 0 Yes Yes
Loan Collective
Co.,Ltd, 2019 er 2020 up
Fund Trust
development
Plan
and
construction of
the Fuhua
block (Phase
IV)
It is used for
Investment in
bonds traded
in the
MinSheng
exchange and
China Trust-
10 in the inter-
MinSheng Zhongmin 9 June
Trust 50,000 Owned fund September bank Cash 5.90% 2,206.44 905.21 735.48 0 Yes Yes
Trust Co., Yongfeng No.1 2020
2019 market,Money
Ltd Collective Fund
market
Trust Plan
instruments,
money funds,
bond funds,
etc
Zhongrong Zhongrong It is used for
25 24
Internation Trust- Jida issuing trust
Trust 12,000 Owned fund September Septemb Cash 8.10% 972 258.31 229.02 0 Yes Yes
al Trust No.15 loans to
2019 er 2020
Co.,Ltd. Collective Fund Qingdao Linshi
48
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Trust Plan Huafu Real
Estate Co.,
Ltd., and for
the payment of
relocation
compensation
fees and the
construction of
resettlement
houses for the
old village
reconstruction
project in
Zhujiawa
community,
Qingdao
It is used to
transfer the
gain right of
48.99% equity
of Quanzhou
Zhongrong Shimao
Zhongrong Trust- Ruiying
27 26
Internation Xingchuang Property Co.,
Trust 10,000 Owned fund September Septemb Cash 8.00% 800 208.22 184.11 0 Yes Yes
al Trust No.107 Ltd. held by
2019 er 2020
Co.,Ltd. Collective Fund Zhuhai
Trust Plan Hengqin
Mingsheng
Investment
Enterprise
(Limited
Partnership)
Chongqing Chongqing 27 7 August It is used for
Trust 15,000 Owned fund Cash 7.80% 2,179.73 304.52 269.26 0 Yes Yes
Trust Trust- Gusu September 2021 issuing trust
49
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
Co.,Ltd. No.3 Collective 2019 loans to
Fund Trust Suzhou
Plan Evergrande
Real Estate
Development
Co., Ltd., and
eventually
used for the
development
and
construction of
Block 60, East
Fangqiao
Road and
North of
Chunqiu Road,
Huangtai town,
Xiangcheng
District,
Suzhou city,
Jiangsu
province, and
the repayment
of
shareholders’
loans
It is used for
Avic Trust -
investment in
Apocalypse
bank deposit,
No.556 29
Avic Trust 10 June inter-bank
Trust Tiancheng Jufu 20,000 Owned fund September Cash 7.50% 1,047.95 382.19 0 0 Yes Yes
Co.,Ltd. 2020 lending, bond
Investment 2019
reverse
Collective Fund
repurchase,
Trust Plan
money market
50
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
fund, bond
fund,
exchange and
inter-bank
market bond,
etc.
It is used to
issue loans to
Nanjing Kaisa
Jiayu Real
Estate
Development
MinSheng
Co., Ltd., and
Trust- Zhixing
China for repayment
No.655 Kaisa 16
MinSheng 16 October of
Trust Nanjing Project 10,000 Owned fund January Cash 9.00% 1,129.32 187.4 0 0 Yes Yes
Trust Co., 2019 shareholders’
Loan Collective 2021
Ltd loans
Fund Trust
generated by
Plan
Yanranju
Project and the
subsequent
development
and
construction
It is used for
China Foreign
issuing trust
Economy and
China loans to Harbin
Trade Trust-
Foreign Pengye Real
Furong No.159 23
Economy 23 October Estate
Trust Evergrande 12,000 Owned fund October Cash 8.30% 998.73 188.28 160.47 0 Yes Yes
and Trade 2019 Development
Harbin Junruifu 2020
Trust Co., Co., Ltd., for
Project
Ltd. the
Collective Fund
development
Trust Plan
and
51
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
construction of
the Harbin
Junruifu
Project and the
repayment of
shareholders’
loans
It is used to
transfer the
gain right of
specific asset
formed by the
"Evergrande
Sanshui Zilin
Garden"
developed by
Foshan
Minmetals
Sanshui
International
Yingsheng
Minmetals Trust- Hengxin
15 28 Real Estate
Internation Gongzhu
Trust 18,000 Owned fund November October Development Cash 8.60% 1,475.9 195.09 148.44 0 Yes Yes
al Trust No.231- Kunyi
2019 2020 Co., Ltd and it
Co.,Ltd. No.11
is eventually
Collective Fund
used for the
Trust Plan
development
and
construction of
Sanshui Zilin
Garden( Phase
I, II,IV) in
Sanshui
District,
Foshan,
Guangdong
52
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
province
It is used for
Zhongrong issuing
Zhongrong Trust- operating
15 15
Internation Fengteng property loans
Trust 16,000 Owned fund November Novembe Cash 8.70% 2,787.81 175.43 133.48 0 Yes
al Trust No.56 to Nanchang Yes
2019 r 2021
Co.,Ltd. Collective Fund Wanda City
Trust Plan Investment
Co., Ltd.
It is used for
investment in
bank deposit,
inter-bank
Avic Trust -
lending, bond
Apocalypse
reverse
No.556 4
Avic Trust 4 June repurchase,
Trust Tiancheng Jufu 20,000 Owned fund December Cash 7.90% 792.16 116.88 0 0 Yes Yes
Co.,Ltd. 2020 money market
Investment 2019
fund, bond
Collective Fund
fund,
Trust Plan
exchange and
inter-bank
market bond,
etc.
It is used for
Investment in
bonds traded
MinSheng
in the
China Trust-
6 exchange and
MinSheng Zhongmin 2 June
Trust 50,000 Owned fund December in the inter- Cash 5.90% 1,446.71 202.05 0 0 Yes Yes
Trust Co., Yongfeng No.1 2020
2019 bank
Ltd Collective Fund
market,Money
Trust Plan
market
instruments,
money funds,
53
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
bond funds,
etc
It is used for
Chongqing participating in
Chongqing Trust- Qirui 12 Chongqing
8 May
Trust Trust No.10 15,000 Owned fund December Trust- Hongrui Cash 7.90% 1,665.49 61.68 0 0 Yes Yes
2021
Co.,Ltd. Collective Fund 2019 No.6 Collective
Trust Plan Fund Trust
Plan
It is used for
issuing trust
loans to Sunac
North China
Real Estate
CITIC Trust- Group Co.,
Jiahe No.116 Ltd., and for
CITIC 19 19
Sunac Tianjin the
Trust Trust 5,000 Owned fund December Decembe Cash 7.80% 391.07 12.82 0 0 Yes Yes
Loan Collective development,
Co.,Ltd, 2019 r 2020
Fund Trust construction
Plan and operation
expenses of
residence
project in
Tianjin Dongli
Sunac Park
It is used for
Avic Trust - investment in
Apocalypse bank deposit,
No.556 20 inter-bank
Avic Trust 20 May
Trust Tiancheng Jufu 50,000 Owned fund December lending, bond Cash 7.70% 1,603.29 116.03 0 0 Yes Yes
Co.,Ltd. 2020
Investment 2019 reverse
Collective Fund repurchase,
Trust Plan money market
fund, bond
54
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Summary
Actual Whether
Amount and
Method Actual principal Whether it there will
Referenced prospective reserved for reference
Name of Trustee Source of Commence Terminati Funds of profit & amount go through be entrust
Product type Amount annualized earnings（if impairment （if
trustee type funding ment date on date allocation Remun loss for the recovered statutory finance
return applicable) (if
eration period for the procedures plans in applicable
applicable)
period the future ）
fund,
exchange and
inter-bank
market bond,
etc.
Total 574,000 -- -- -- -- -- -- 49,667.36 13,396.22 -- 0 -- -- --
Entrust finance expected to be failed to recover principle or other situation leading to impairment
Applicable √ N/A
17.3.2 Entrust loans
Applicable √ N/A
No such cases in the reporting period.
17.4 Other significant contracts
Applicable √ N/A
No such cases in the reporting period.
18. Social responsibilities
18.1 Information about taking social responsibilities
The information about taking social responsibilities disclosed in 2019 Annual Social Responsibilities Report in detail on www.cninfo.com.cn on 29 April
2020.
18.2 Information about targeted poverty alleviation
18.2.1 Targeted poverty alleviation plan
According to the call of Suqian municipal party committee and municipal government on poverty alleviation with the work of "guacun baohu" and
"three into three help", the Company actively responded and quickly implemented the relevant requirements with practical actions to practice the spirit
of enterprise and take bravely social responsibility.
55
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
According to the overall work arrangement of "guacun baohu" by Suqian municipal
government, the Company supports Qiuzhuang village in Zhenglou branch, Yanghe new
district and is responsible for the assistance work for 177 low-income households in
Daguo village and Taiping village, Zhenglou branch, among which 88 households are in
Taiping village and 89 in Daguo village. The Company earnestly implements the spirit of
the 19th National Congress of the Communist Party of China and regards alleviating
poverty precisely and quickly as its own duty. Combined with the local actual condition of
Zhenglou branch, the Company makes the support plan carefully to complete the support
mission. It promotes the rural development, and enhances the farmers' income,
strengthens the relationship between cadres and masses, and makes due contributions
to “liang ju yi gao” work.
In 2020, the Company will not stop poverty alleviation until there are no poor households
in the branch. The Company firmly sticks to responsibility, remains true to original
aspiration with a clear goal and makes greater alleviation efforts. The Company
integrates resources from all sides, creates a new situation for poverty alleviation,
practices the entrepreneurial spirit of "serving the country and serving the people", and
shows that the Company has the courage to take responsibilities and is good at it.
18.2.2 Summary of annual targeted poverty alleviation
In 2019, based on the enterprise operation strategy and poverty alleviation planning,
combined with local cultural and environmental conditions of Qiuzhuang village in
Zhenglou branch, Yanghe new district. The Company made good use of the land
resources of Qiuzhuang village actively and helped to carry out the land conversion
project. The Company also carried out scientific visits and overall analysis with big data
management via Sunlight Poverty Alleviation APP. The Company positively conducted
poverty alleviation for villages and low-income households. Each task for "guacun baohu"
was completed successfully in 2019. The average annual income of low-income farmers
paired by the Company has exceeded CNY 6,000 and they have been out of poverty.
The collective economic income of Qiuzhuang village paired by the Company reached
CNY 475,000 in 2019, which completed annual task beyond the requirements. The
Company also continued to provide CNY 2 million of poverty alleviation and educational
funds for the "masses" of the city, and won the "Suqian special contribution award" again.
It made positive contributions to the city's poverty alleviation.
18.2.3 Poverty alleviation achievement
Indicator Unit Amount/Implementation situation
A.Overall situation —— ——
Including：1.Fund CNY 10,000 220
2.Goods converted into cash CNY 10,000 12
3.Establishing card for archives of poor
Person 718
people out of poverty
B. Input by project —— ——
1.Industrial development —— ——
2.Transfer and employment —— ——
3.Removal and relocation —— ——
4.Educational poverty alleviation —— ——
Including: 4.1 investment amount to
CNY 10,000 200
subsidize poor students
5.Health poverty alleviation —— ——
56
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
6.Ecological protection —— ——
7.Basic guarantee —— ——
8.Social poverty alleviation —— ——
8.2 investment amount of fixed-point
CNY 10,000 12
poverty alleviation work
9.Other project —— ——
Including：9.1.Item Item 2
9.2.Input amount CNY 10,000 20
9.3. The number of registered impoverished
Person 718
people to be out of poverty
C. Awards（content and level） —— ——
Suqian Special contribution award
18.2.4 Follow-up poverty alleviation plan
In 2020, the Company will continue to consolidate the village-level collective economy,
consolidate the income of low-income farmers, systematically plan public welfare and
continue to build a public-spirited corporate image.
The Company will improve production and marketing channel and consolidate the village
collective economy. In 2020, the Company will continue to strengthen the cooperation
with the "two committees" of the village to actively promote the land transfer project of
Qiuzhuang village. It plans to invest another CNY 200,000 in 2020 to help the collective
transfer land of more than 200 mu of Qiuzhuang village for the establishment or joint
establishment of food planting base. In addition, in order to further solve the problem of
selling farmers' agricultural products, the Company will purchase the grain from the
village's planting base on the same market price and standard.
The Company will intensify poverty alleviation visits and consolidate farmers' incomes.
Party organizations at all level will play an important role as a fighting fortress. The
Company will select the leading cadres with excellent quality and work style, insist on the
responsibility to the person, to the branch, further clarify the concept of "help who" and
"who help", stabilize the pair relationship, standardize the poverty alleviation work
mechanism. The Company will adhere to walking into village and visiting households
regularly with high-quality information collection and refinement of poverty alleviation.
The Company will ascertain the actual situation and find out problems in the work. It
makes sure that the policy can be implemented precisely and every low-income family
can be helped.
57
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
18.3 Information about environment protection
Whether the listed company and its subsidiaries belong to heavy polluting industries prescribed by the environmental protection departments
Yes
Name of main
Amount of Distribution
Company pollutant and Discharge Emission Pollution discharge Approved total Excessive
discharge of discharge Total emission
name particular type concentration standard emission discharge
outlet outlet
pollutant
COD:128.24 ton; COD:1.018 ton per
COD COD:74.2mg/L;Amm COD:400mg/L;Amm
Ammonia day;Ammonia
Jiangsu Ammonia onia onia nitrogen:0.99 nitrogen:0.060 tons
Yanghe nitrogen nitrogen:0.57mg/L;T nitrogen :30mg/L;Tot
ton;Total per day;Total
Brewery Total Indirect discharge 1 Within site No
otal phosphorus： al phosphorus: phosphorus:0.271
Joint-Stock phosphorus phosphorus：3.63
2.1mg/L; Total 3mg/L;Total tons per day; Total
Co., Ltd. Total tons; Total
nitrogen:27.8mg/L nitrogen: 50mg/L nitrogen:0.023 tons
nitrogen nitrogen:48.04 tons
per day
COD:356.48 tons per
COD COD:100mg/L;Amm COD:400mg/L;Amm COD:65.48 tons; year;Ammonia
Jiangsu Ammonia onia onia Ammonia
nitrogen:31.192 tons
Shuanggou nitrogen nitrogen:35mg/L;Tot nitrogen :3.27 tons;
New and old nitrogen:5mg/L;Total per year; Total
Distillery Total Indirect discharge 2 al phosphorus:8 Total No
factory area phosphorus：3 phosphorus:7.1296
Stock phosphorus mg/L;Total phosphorus:1.96
mg/L; Total tons per year; Total
Co.,Ltd. Total nitrogen:45 mg/L mg/L;Total
nitrogen:25 mg/L nitrogen:40.104 tons
nitrogen nitrogen:16.37 mg/L
per year
Jiangsu COD COD:150
COD:400mg/L;Amm COD:119.8 tons;
Yanghe Ammonia mg/L;Ammonia Ammonia
onia COD:672 tons per
Brewery nitrogen nitrogen :2.4
nitrogen :30mg/L;Tot nitrogen :1.916 year;Ammonia
Joint-Stock Total Indirect discharge 1 Within site mg/L;Total tons; Total No
al phosphorus：3 nitrogen:42 tons per
Co., Ltd. phosphorus phosphorus：2.8 phosphorus:2.23
mg/L; Total year
Siyang Total mg/L; Total mg/L;Total
Branch nitrogen nitrogen:40 mg/L nitrogen:18.37 mg/L
nitrogen:23 mg/L
Guizhou COD Direct discharge COD：40.5 COD;100mg/L;Amm COD:2.009 COD:2.057 tons per
1 Within site No
Guijiu Ammonia after treatment up mg/L;Ammonia onia tons;Ammonia year;Ammonia
58
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Name of main
Amount of Distribution
Company pollutant and Discharge Emission Pollution discharge Approved total Excessive
discharge of discharge Total emission
name particular type concentration standard emission discharge
outlet outlet
pollutant
Co.,Ltd. nitrogen to the standards nitrogen:1.19 nitrogen:15mg/L;Sulf nitrogen:0.059 nitrogen:0.308 tons
Sulfur dioxide mg/L;Sulfur ur dioxide :50mg/m tons ;Sulfur per year
dioxide:6mg/m dioxide :0.00121
tons
Hubei COD:14.2 ton per
COD COD:132.0 COD:400mg/L;Amm COD:0.624
Lihuacun year;Ammonia
Ammonia Indirect discharge 1 Within site mg/L;Ammonia onia tons ;Ammonia No
Distillery nitrogen:1.42 tons
nitrogen nitrogen:14.1mg/L nitrogen:30mg/L nitrogen:0.067 tons
Co.,Ltd. per year
Construction and operation of pollution prevention and control facilities
(1) Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.: ①The sewage treatment station’s designed capacity is 10,000 tons per day. The project total
investment is CNY 96 million and it covers an area of 19,000 square meters. The sewage treatment adopts physical treatment method, chemical
treatment method and anaerobic biological treatment method, aerobic biological treatment method, good oxygen treatment method, which achieves
the treatment of high-concentration waste water of 250 tons per hour. It implements the "Fermentation Alcohol and Liquor Industrial Pollutants
Emission Standards CB27631-2011" Indirect Emissions Standards. ② In 2019, the sewage treatment station implements efficient investment item
upgrade project, mainly including machine material consumption and maintenance of rain and sewage diversion pipe network in the factory etc. The
total investment is CNY 11.39 million. The Company comprehensively improved the basic management level of water and sewage diversion in the
factory, precisely implemented fine environmental protection operation, and comprehensively utilized 83,700 tons of self-produced steam throughout
the year.
(2) Jiangsu Shuanggou Distillery Stock Co.,Ltd.: ①The sewage treatment station in Shuanggou Distillery New Area was completed with an investment
of CNY 42.5 million and an annual operating cost of CNY 13 million. The sewage treatment station inlet COD and ammonia nitrogen concentration are
about 10000mg/l and 185mg/l respectively. The effluent COD and ammonia nitrogen concentration are about 100mg/l (the discharge standard is
400mg/l) and 5mg/l (the discharge standard is 35mg/l), with implementation of "Shuanggou town sewage treatment plant takeover standards". ②
59
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Shuanggou Distillery has set up a hazardous waste warehouse to collect hazardous waste generated in production and living. The warehouse is
divided into: waste battery, desulfurizer, solid waste agent, liquid waste agent, daylight lamp tube, desulfurizer and other areas for classified storage
so as to prevent cross-contamination. Shuanggou Distillery shall also declare the hazardous waste information through the dynamic management
system of hazardous waste in Jiangsu province, and regularly submit the hazardous waste to qualified companies for legal disposal.
(3) Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. Siyang Branch: ① The sewage treatment station covers an area of about 15,000 square meters,
with a total investment of CNY 50 million. The designed treatment capacity is 6000 tons per day. In terms of process treatment, EGSB+AAO+deep
treatment technology is adopted. The high-concentration waste water can be treated up to 250 tons per hour. After treatment, all indicators reached
the indirect emission standard of "Fermented Alcohol and Liquor Industrial Pollutant Emission Standard CB27631-2011". ② In 2019, Siyang sewage
treatment station ran efficiently. There were several projects with a total investment of CNY 10.0393 million, mainly including year-round online
monitoring equipment, anaerobic inlet pipeline adjustment, pipeline intelligent monitoring, fan matching upgrade and pharmaceutical procurement. The
annual output of biogas in the anaerobic treatment unit was 6.931 million cubic meters and that of steam was 94,200 tons.
(4) Guizhou Guijiu Co.,Ltd.: ① The factory is equipped with a sewage treatment system to treat production and household waste water. The sewage
treatment system has a treatment capacity of 250 tons per day. The discharge of waste water shall be in accordance with the Discharge Standards for
Water Pollutants in Fermented Alcohol and Liquor Industry GB27631-2011 Table 2 Emission Standards. At the same time, an online detection system
is installed and the facilities are in good condition. ② The boiler operates with natural gas, and the waste gas is discharged directly. The exhaust gas
emission shall be in accordance with the "Boiler Air Pollutant Emission Standard" (GB13271-2014) Table 2 Gas Boiler Limited Discharge Standard .
③ The solid waste (distillers) generated in the production is all processed by a third-party qualified company, and the treatment method is integrated
utilization for the production of fertilizer. ④ Noise is mainly due to Quyao crusher, boiler room fan, packaging workshop, power distribution. The
equipment is installed with absorption treatment or sound insulation in the room to reduce the impact of noise. The Company uses anaerobic UASB
/good oxygen (contact oxidation) to treat mixed sewage in production and living.
60
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(5) Hubei Lihuacun Distillery Co.,Ltd.: The waste water is treated by combined process in the factory; Each workshop is equipped with mufflers and
independent machine room with the independent foundation and sound absorption material and sound insulation material for reducing the noise; Solid
waste is treated by comprehensive treatment method.
Environmental impact assessment of construction projects and other administrative permits for environmental protection
The Company and each subsidiary’s construction project environmental impact reports and "three at the same time" acceptance materials, pollutant
discharge permit and other materials are complete.
61
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Emergency plan for environmental emergencies
The Company and its subsidiaries have made emergency plans for environmental
emergencies, among which the Company, Shuanggou Distillery and Siyang Branch of
the Company have filed with Jiangsu Province Environmental Protection Department.
The file numbers are 321300-2019-008-L, 32000020140604, 32000020140594
respectively. The emergency plan of environmental emergencies of Guijiu Company has
been put on record in the local environmental protection administration and managed by
Guizhou Province Environmental Emergencies Center. The emergency plan of
environmental emergencies of Lihuacun Distillery has been put on record in the local
environmental protection administration.
Environmental self-monitoring programme
The Company and its subsidies have all developed their own environmental monitoring
programs and filed them with the competent authorities according to requirements of
local environmental protection department. Everyday, The Company, Shuanggou
Distillery, Siyang Branch of the Company conduct self-monitoring of the pollution
indicators of COD, ammonia nitrogen, total phosphorus, total nitrogen, PH, etc., and
regularly entrust a third party to conduct testing and issue a report. Guijiu Company
regularly entrusts a third party to conduct testing and issue a report. There are several
equipment installed in sewage outlet for automatic online monitoring COD, ammonia
nitrogen, total phosphorus, total nitrogen, PH, flow meter.
Other environmental information that should be made public
N/A
Other environmental related information
The Company won the honorary title of "2019 National Green Factory" and the honorary
title of "2019 Water Saving Enterprise in Jiangsu province".
19. Other significant events
√ Applicable N/A
1. The Company indirectly held partnership share of Jiangsu Jiequan Emerging Industry
Development Fund (Limited Partnership) via Jiangsu Xinghe Investment Management
Co.,Ltd. and Nanjing Xingnahe Venture Capital Investment partnership (Limited
Partnership). Jiangsu Jiequan Emerging Industry Development Fund (Limited
Partnership) completed fund-raising and put on record in AMAC. The record numbers are
SCF515 and SCL005. It was disclosed in detail on the Announcement of cooperative
investment with professional investment institutions (No: 2017-021) on 30 December
2017 and the Announcement of progress of cooperative investment with professional
investment institutions (No: 2018-011) on 12 April 2018.
2. Su Wine Wealth Management Co., Ltd., a wholly-owned subsidiary of the Company,
subscribed the partnership shares of Suzhou Danqing Phase II Innovative
Pharmaceutical Industry Investment Partnership (limited partnership). Danqing Phase II
completed fund-raising and put on record in AMAC. The record number is SED720. For
details, please refer to the Announcement on cooperation and investment with
professional investment institutions (Announcement No: 2018-021) and Announcement
on cooperation, Announcement on cooperation and investment with professional
investment institutions (Announcement No: 2018-030) and Announcement on
62
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
cooperation and investment with professional investment institutions (Announcement No:
2019-004) disclosed by the Company on 28 April 2018, 16 November 2018 and 11 April
2019 respectively.
3. Jiangsu Yanghe Investment Management Co.,Ltd. subscribed the partnership shares
of Panmao (Shanghai) Investment Center (limited partnership). For details, please refer
to the Announcement on cooperation and investment with professional investment
institutions (Announcement No: 2018-025) disclosed by the Company on 22 June 2018.
4. Jiangsu Yanghe Investment Management Co.,Ltd. subscribed the partnership shares
of Jiangsu Zijin Hongyun Health Industry Investment Partnership (limited partnership),
Suqian Yida Industry Venture Capital Fund (limited partnership), and Hunan Huaye
Tiancheng Venture Capital Partnership (limited partnership). For details, please refer to
the Announcement on cooperation and investment with professional investment
institutions (Announcement No: 2019-002) disclosed by the Company on 28 March 2019,
Announcement on participating in Suqian Yida Industrial Venture Capital Fund and
related transaction (Announcement No: 2019-012) disclosed by the Company on 30 April
2019, and Announcement on the subscription of Hunan Huaye Tiancheng Venture
Capital Fund (Announcement No: 2019-021) disclosed by the Company on 6 September
2019.
20. Significant events of subsidiaries
Applicable √ N/A
63
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section VI Changes in Shares and Information about Shareholders
1. Changes in shares
1.1 Changes in shares
Unit：Share
Before Changes in this year ( + , - ) After
Issuance of Bonus Capitalization of
Number Proportion Other Subtotal Number Proportion
new shares shares capital reserves
I.Restricted shares 258,502,176 17.15% 0 0 0 -453,750 -453,750 258,048,426 17.12%
1.Shares held by the state 0 0.00% 0 0 0 0 0 0 0.00%
2.Shares held by state-owned
0 0.00% 0 0 0 0 0 0 0.00%
corporations
3.Shares held by other domestic
258,502,176 17.15% 0 0 0 -453,750 -453,750 258,048,426 17.12%
investors
Including:Shares held by domestic
249,480,000 16.55% 0 0 0 0 0 249,480,000 16.55%
corporations
Shares held by domestic individuals 9,022,176 0.60% 0 0 0 -453,750 -453,750 8,568,426 0.57%
4.Shares held by foreign investors 0 0.00% 0 0 0 0 0 0 0.00%
Including: Shares held by foreign
0 0.00% 0 0 0 0 0 0 0.00%
corporations
Shares held by foreign individuals 0 0.00% 0 0 0 0 0 0 0.00%
II.Non-restricted shares 1,248,485,824 82.85% 0 0 0 453,750 453,750 1,248,939,574 82.88%
1.CNY common shares 1,248,485,824 82.85% 0 0 0 453,750 453,750 1,248,939,574 82.88%
2.Domestically listed foreign shares 0 0.00% 0 0 0 0 0 0 0.00%
3.Overseas listed foreign shares 0 0.00% 0 0 0 0 0 0 0.00%
4.Others 0 0.00% 0 0 0 0 0 0 0.00%
III.Total shares 1,506,988,000 100.00% 0 0 0 0 0 1,506,988,000 100.00%
Reasons for the change in shares
√ Applicable N/A
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
The reasons for the change of the Company's shares are mainly caused by changes of the locked shares held by the Company's executives.
Approval of share changes
Applicable √N/A
Transfer of share ownership
Applicable √N/A
Implementation progress of share repurchase
√ Applicable N/A
On October 29, 2019, the sixth session of the ninth meeting of the board of directors was held. It reviewed and approved the plan about repurchasing
part of the social public shares, and agreed to use its own funds to repurchase shares through centralized bidding. The total amount of repurchase is
not less than CNY 1 billion (including) and not more than CNY 1.5 billion (including). The repurchase price is not more than CNY 135.00 per share
(including). The period of repurchases is within 12 months since the repurchase plan is reviewed and approved by the sixth session of the ninth
meeting of the board of directors. This share repurchased is used to implement equity incentive or employee stock ownership plan for core key
employees of the Company.The repurchase affairs was disclosed in details in “About the plan of share repurchase from part of public shares”
(Announcement No. 2019-026), “Repurchase report” (Announcement No.2019-028), etc. on China Securities Journal, Shanghai Securities News and
Securities Times, Securities Daily and www.cninfo.com.cn on 30 October 2019 and on 5 November 2019.
From the repurchase plan disclosed to 31 December 2019, the Company has not implemented the share repurchase.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Implementation progress of share repurchase reduction through centralized bidding
Applicable √N/A
Effects of changes in shares on the basic EPS, diluted EPS, net assets per share
attributable to common shareholders of the Company and other financial indexes over
the last year and the last reporting period
Applicable √N/A
Other contents that the Company considers necessary or is required by the securities
regulatory authorities to disclose
Applicable √N/A
2. Changes in restricted shares
√Applicable N/A
Unit：Share
Opening Unlocked Closing
Name of Increase in this Date of
restricted in this restricted Reason
shareholder period unlocking
shares period shares
Locked due to current
Zheng Bujun 48,750 0 -3,750 45,000 N/A
executive position
Cong Locked due to current
2,533,718 0 -450,000 2,083,718 N/A
Xuenian executive position
Total 2,582,468 0 -453,750 2,128,718 -- --
2. Issuance and listing of securities
2.1 Securities（excluding preference shares）issued in the reporting
period
Applicable √N/A
2.2 Changes in total shares of the company and the shareholder
structure, as well as the asset and liability structure
Applicable √N/A
2.3 Existing staff-held shares
Applicable √N/A
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
3. Shareholders and actual controller
3.1 Total number of shareholders and their shareholdings
Unit:share
Total number of
Total number of common preference
Total number of preference
shareholders at the prior shareholders
Total number of common shareholders at shareholders with resumed
78,298 month-end before the 97,466 0 with resumed 0
the end of the reporting period voting rights at the period-
disclosure date of the annual voting rights at
end(if any)(see Note 8)
report the period-end(if
any)(see Note 8)
Shareholdings of shareholders with a shareholding percentage over 5% or the top 10 shareholders
Shareho Increase/decr Pledged or frozen shares
Total shares Number of Number of
lding ease during
Name of shareholder Nature of shareholder held at the restricted non-restricted Status of Number of
percent the reporting
period-end shares held shares held shares shares
age period
Jiangsu Yanghe Group Co.,Ltd. State-owned corporation 34.16% 514,858,939 0 0 514,858,939
Domestic non-state-owned
Jiangsu Blue Alliance Joint-Stock Co., Ltd. 21.44% 323,138,626 0 249,480,000 73,658,626
corporation
Shanghai Haiyan Logistics Development
State-owned corporation 9.67% 145,708,137 0 0 145,708,137
Co.,Ltd.
Hong Kong Securities Clearing Company
Outbound corporation 7.87% 118,585,244 20,447,821 0 118,585,244
Ltd. (HKSCC)
Shanghai Jieqiang Tobacco Sugar
State-owned corporation 4.02% 60,608,499 -846,976 0 60,608,499
&Wine(Group)Co.,Ltd
Bank of China Co.,Ltd. – Liquor index
Domestic non-state-owned
classification securities investment fund by 0.99% 14,917,557 5,683,258 0 14,917,557
corporation
China Merchants Fund
China Securities Finance Corporation limited State-owned corporation 0.92% 13,790,044 0 0 13,790,044
Central Huijin Asset Management Co., Ltd. Outbound corporation 0.85% 12,766,400 0 0 12,766,400
Bank of China Co.,Ltd. – E-funds SME
Other 0.50% 7,480,001 4,379,964 0 7,480,001
hybrid securities investment funds
Xingyuan Asset Management Co.,Ltd.－
Outbound corporation 0.48% 7,281,202 -2,684,900 0 7,281,202
clients' capital
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Strategic investors or general corporations to be top-ten shareholders due
N/A
to placing of new shares(if any)(see Note 3)
Related-parties or acting-in-concert N/A
Shareholdings of the top 10 non-restricted shareholders
Number of non-restricted shares Type of shares
Name of shareholder
held in the period end Type Number
Jiangsu Yanghe Group Co.,Ltd. 514,858,939 CNY common shares 514,858,939
Shanghai Haiyan Logistics Development Co.,Ltd. 145,708,137 CNY common shares 145,708,137
Hong Kong Securities Clearing Company Ltd. (HKSCC) 118,585,244 CNY common shares 118,585,244
Jiangsu Blue Alliance Joint-Stock Co., Ltd. 73,658,626 CNY common shares 73,658,626
Shanghai Jieqiang Tobacco Sugar & Wine(Group)Co.,Ltd 60,608,499 CNY common shares 60,608,499
Bank of China Co.,Ltd. – Liquor index classification securities investment
14,917,557 CNY common shares 14,917,557
fund by China Merchants Fund
China Securities Finance Corporation limited 13,790,044 CNY common shares 13,790,044
Central Huijin Asset Management Co., Ltd. 12,766,400 CNY common shares 12,766,400
Bank of China Co.,Ltd. – E-funds SME hybrid securities investment funds 7,480,001 CNY common shares 7,480,001
Xingyuan Asset Management Co.,Ltd.－clients' capital 7,281,202 CNY common shares 7,281,202
Strategic investors or general corporations becoming top 10 shareholders
N/A
due to placing of new shares(if any)(see Notes 3)
Explanation on the top 10 common shareholders participating in the
N/A
securities margin trading(if any)(see Notes 4)
Whether any of the top 10 common shareholders or the top non-restricted common shareholders of the Company conduct any promissory repurchase
during the reporting period.
Yes √ No
No such cases in the reporting period.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
3.2 Controlling shareholder
Nature of controlling shareholder：Local state-owned
Type of controlling shareholder：Corporation
Legal
Name of
representative/ Date of Credibility
controlling Main business scope
Company establishment code
shareholder
principal
Sales of brewing mechanical
equipment, Liquor Export, Import
of various raw and auxiliary
material used for production,
Jiangsu Yanghe 91321300142
Li Minfu 8 May 1997 equipment and accessories,
Group Co.,Ltd. 334989Y
Industrial investment; municipal
public engineering, building
engineering, tourism cultural
industry investment.
Shareholdings of
the controlling
shareholder in
other controlled or
non-controlled N/A
listed companies at
home or abroad
during the
reporting period
Change of the controlling shareholder during the reporting period
Applicable √N/A
No such cases in the reporting period.
3.3 Actual controller and its persons acting in concert
Nature of actual controller：Local State-owned Assets Supervision and Administration
Commission
Type of actual controller：Corporation
Legal
Name of actual Date of
representative/C Credibility code Main business scope
controller establishment
ompany principal
Execution of duty of state-
owned enterprise's investor on
State-owned
behalf of the People's
Assets Supervision
22 October Government of Suqian and
and Administration Zhao Xiaoli N/A
2005 implementation of Supervision
Commission of
and Administration of State-
Suqian
owned Assets and State-owned
Enterprises.
Share holdings of
the controlling
shareholder in
other controlled or N/A
non-controlled
listed companies
at home or abroad
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
during the
reporting period.
Change of the actual controller during the reporting period
Applicable √N/A
No such cases in the reporting period.
Ownership and control relations between the actual controller and the Company
The actual controller control the company via trust or other ways of assets management
Applicable √ N/A
3.4 Other corporate shareholders with a shareholding proportion over 10%
√Applicable N/A
Legal
representative/ Date of
Name of actual controller Registered capital Main business scope
Company establishment
principal
Sales of daily products,
research and
development of biology
technology, furniture
Jiangsu Blue Alliance
Zhao Qike 28 July 2016 CNY 105,600,000.00 production, Business
Joint-Stock Co., Ltd.
management
consulting service, fruit
tree planting, Sales of
prepackaging food.
3.5 Limits on the Company’s shares held by its controlling shareholder,
actual controller, restructuring party and other commitment entities.
Applicable √ N/A
70
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section VII Information about Preference Shares
Applicable √ N/A
No such cases in the reporting period
71
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section VIII Information about Convertible Bonds
Applicable √ N/A
No such cases in the reporting period
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section IX Profiles of Directors, Supervisory, Senior Management and Employees
1. Change in shares owned by directors, members of supervisory committee, senior management and
employees
Shares
Shares Other
Shares held decreas Shares
increased at increas
Incumbent Start date of Termination at the ed at the held at the
Name Office title Gender Age the reporting e/decre
/ Former term date of term period-begin reporting period-end
period ase
(share) period (share)
(share) (share)
(share)
10 February 29 January
Wang Yao Chairman of the board Incumbent Male 55 2015 2021 30,002 0 0 0 30,002
10 February 29 January
Vice chairman of the
Zhong Yu Incumbent Male 56 2015 2021 0 0 0 0 0
board,President
29 January 29 January
Liu Director,executive vice
Incumbent Male 50 2018 2021 0 0 0 0 0
Huashuang president
Director,Vice 10 February 29 January
Cong
president,Secretary of Incumbent Male 54 2015 2021 2,778,291 0 0 0 2,778,291
Xuenian
the board,CFO
Director,Vice 10 February 29 January
Zhou Xinhu president,Chief Incumbent Male 58 2015 2021 2,878,291 0 0 0 2,878,291
engineer
29 January
19 May 2017
Wang Kai Director Incumbent Male 43 2021 0 0 0 0 0
10 February 29 January
Xu Zhijian Non-executive director Incumbent Male 56 2015 2021 0 0 0 0 0
10 February 29 January
Cai
Non-executive director Incumbent Female 68 2015 2021 0 0 0 0 0
Yunqing
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Shares
Shares Other
Shares held decreas Shares
increased at increas
Incumbent Start date of Termination at the ed at the held at the
Name Office title Gender Age the reporting e/decre
/ Former term date of term period-begin reporting period-end
period ase
(share) period (share)
(share) (share)
(share)
10 February 29 January
Ji Xueqing Non-executive director Incumbent Male 49 2015 2021 0 0 0 0 0
10 February 29 January
Chen
Non-executive director Incumbent Male 54 2015 2021 0 0 0 0 0
Tongguang
10 February 29 January
Feng Chairman of
Incumbent Male 60 2015 2021 5,677,986 0 0 0 5,677,986
Pantai supervisory committee
29 January
Xu 23 May 2019
Supervisor Incumbent Male 43 2021 0 0 0 0 0
Youheng
10 February 29 January
Chen
Supervisor Incumbent Male 55 2015 2021 0 0 0 0 0
Taiqing
10 February 29 January
Chen
Supervisor Incumbent Male 52 2015 2021 0 0 0 0 0
Taisong
10 February 29 January
Zhou
Supervisor Incumbent Female 54 2015 2021 0 0 0 0 0
Wenqi
10 February 29 January
Lin Qing Vice president Incumbent Female 45 2015 2021 0 0 0 0 0
10 February 29 January
Zheng
Vice president Incumbent Male 53 2015 2021 60,000 0 0 0 60,000
Bujun
10 February
24 April 2020
Han Feng Director Former Male 58 2015 0 0 0 0 0
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Shares
Shares Other
Shares held decreas Shares
increased at increas
Incumbent Start date of Termination at the ed at the held at the
Name Office title Gender Age the reporting e/decre
/ Former term date of term period-begin reporting period-end
period ase
(share) period (share)
(share) (share)
(share)
10 February
11 April 2020
Chen Yiqin Supervisor Former Male 59 2015 0 0 0 0 0
10 February 18 January
Zhu Wei Vice president Former Male 43 2015 2020 0 0 0 0 0
Total 11,424,570 0 0 0 11,424,570
2. Changes in directors, supervisors, senior management and employees
√Applicable N/A
Name Office title Type Date Reason
Chen Yiqin Supervisor Former 11 April 2019 Job change
3. Employment information
Professional background, work experience and major duties of directors, supervisors and senior management
3.1 Directors
Mr. Wang Yao, born in December 1965, Master of engineering from Jiangnan University, MBA from Nanjing University, researcher-level senior
engineer, representative of the 19th National Congress of the Communist Party of China, craft-master of Chinese liquor. He used to serve as
secretary of the party branch and director of crushing and qu-making workshop of Jiangsu Yanghe Brewery; chairman of the board, general manager
and secretary of the party committee of Jiangsu Yanghe Group Color Printing Co.,Ltd.; deputy general manager, deputy secretary of party committee,
secretary of the discipline inspection commission of Shuanggou Distillery; deputy general manager, vice secretary of party committee and president
assistant of Jiangsu Su Wine Industry Co., Ltd.; general manager and vice president of Shuanggou Distillery; chairman of the board and secretary of
the the party committee of Su Wine Trading Co., Ltd.. At present, he is chairman of the board and secretary of the the party committee of the
Company.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Mr. Zhong Yu, born in May 1964, Master degree, senior engineer, Master of Chinese Liquor and Jiangsu 13th NPC member. He was the director of
technology and environmental protection department in Shuanggou Distillery; vice chief engineer, president assistant and director of production and
technology center of Shuanggou Distillery; vice general manager of Yanghe Branch of the Company; brewing director, president assistant, vice
president of the Company, general manager of Siyang Branch of the Company. At present, He is a vice chairman of the board, president, vice
secretary of the the party committee of the Company, general manager of Yanghe Branch of the Company and chairman of the board of Shuanggou
Distillery.
Mr. Liu Huashuang, born in December 1970, MBA from Fudan University, accountant. He was the director of marketing department and deputy
general manager of Jiangsu Yanghe Brewing, general manager of Yanghe Blue Classic, general manager of Jiangsu Yanghe Brewing, member of the
standing party committee of Company, director of strategic studies, vice executive general manager and vice secretary of party committee of Jiangsu
Su Wine Industrial Co., Ltd., secretary of party committee and vice chairman of the board of Su Wine Trade Group. At present, he is a director, vice
executive president and member of the standing party committee of the Company and secretary of the party committee and chairman of Su Wine
Trade Group.
Mr. Cong Xuenian, born in January 1966, Master degree, senior economist. He served as a chief accountant and finance director of Yanghe Brewery,
finance minister of Yanghe Group; chief accountant, secretary of the board, financial administrator, director and vice president of the Company. At
present, he is secretary of the board, financial administrator,director, and vice president of the Company, chairman of the board of Su Wine Fortune
Management Co., Ltd. and chairman of the board of Jiangsu Yanghe Investment Management Co., Ltd..
Mr. Zhou Xinhu, born in August 1962, Master degree, senior engineer, member of the expert group of liquor professional committee of China Food
Industry Association, Chief liquor taster of China and Master of Chinese liquor critic. He was technician of Yanghe Group, director of quality inspection
department and blending and storage department, vice general manager of Yanghe Brewing, vice chief engineer, chief engineer and vice president of
the Company. At present, he is a director, vice president and chief engineer of the Company.
Mr. Wang Kai was born on August 1977, Bachelor degree, intermediate economist. He was a manager of brand department in marketing center of
Shanghai Tobacco Group Co., Ltd., president assistant of Shanghai Haiyan Logistics Development Co., Ltd. At present, he is a director of the
Company and vice general manager of Shanghai Haiyan Logistics Development Co., Ltd.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Mr. Xu Zhijian, born in March 1964, Master and Doctor degree from university professor. He was a
director of China&Netherlands Business Administration Education Center of Nanjing University, director
of EMBA Program of Nanjing University&Cornell University, director of International Business
Administration Education Center of Nanjing University, Assistant Dean of Business College of Nanjing
University, Director of the Department of Business Administration of Nanjing University. At present, he
is a non-executive director of the Company, Nanjing Port Co., Ltd., Jiangsu Maysta Chemical Co., Ltd.,
Glarun Technology Co., Ltd. and Yangzhou Rixin Biotechnology Co.,Ltd., and a professor of Business
College of Nanjing University.
Ms. Cai Yunqing, born in December 1952, Doctor of medicine, professor and doctoral supervisor. She
was a director and station-master assistant of food health department of sanitation and antiepidemic
station of Jiangsu province, director of department of nutrition and food hygiene, school of public health,
Nanjing Medical University, director of Institute of Nutrition and Food Science. At present, she is a non-
executive director of the Company, supervisor of Chinese Nutrition Society, honorary president of
Nutrition Society of Jiangsu Province, vice president of Jiangsu Intelligent Aged Research Association
and health food evaluation expert of National Food and Drug Administration.
Mr. Ji Xueqing, born in July 1971, Master degree. He used to be a project manager of China Chuangye
Investment Group Limited, chairman of the board and president of Nanjing Qinghe Investment Group
Co., Ltd., senior vice president of Yonyou Network Technology Co., Ltd. At present, he is a non-
executive director of the Company, non-executive director of Nanjing Balance Network Technology Co.,
Ltd. and NanJing Liandi Information Systems Co.,Ltd.,vice chairman of China University Innovation and
Entrepreneurship Incubator Alliance, chairman of the board of Nanjing Suhe Venture Capital Center,
director of Nanjing Liheng Investment Limited Partnership, supervisor of Xuzhou Zm-Besta Heavy Steel
Structure Co., Ltd.,supervisor of Jiangsu Efful Science and Technology Co.,Ltd., partner of China soft
Investment Group.
Mr. Chen Tongguang, born in April 1966, Bachelor degree, senior accountant. He was accountant of
Jiangsu Huaiyin Electric Company, vice director of finance department of Jiangsu Agricultural College,
vice director of Accounting Center and Finance department of Yangzhou University, vice and general
manager of Yangda company of Yangzhou University Asset Operation Co., Ltd. At present, he is a non-
executive director of the Company, director of quality operation and safety management department in
Yangzhou University and non-executive director of Yangzhou Yangjie Electronic Technology Co., Ltd.
3.2 Supervisors
Mr. Feng Pantai, born in October 1960, College degree, senior economist. He was vice director of
Sihong County Food Bureau, vice general manager of Yanghe Group, director and vice president of the
Company. At present, he is the chairman of the supervisory committee, member of standing committee,
chairman of labor union, director of Blue Alliance.
Mr. Chen Taiqing, born in May 1965, Master degree, Senior political engineer, member of communist
party of China. He was member of the party committee of Yanghe Group, director of executive office,
member of the Company’s party committee, director of human resource department, director of
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
integrated department, president assistant, vice general manager of Yanghe Branch of the Company,
vice general manager and secretary of discipline inspection committee of the Company. At present, he
is a supervisor, vice secretary of the party committee, general manager and secretary of the party
committee of Shuanggou Distillery.
Ms. Zhou Wenqi, born in April 1966, College degree, senior accountant. She was financial director of
Shanghai Jieqiang No.3 and No.4 distribution center, financial assistant, deputy manager, manager of
Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd. At present, she is a supervisor of the
Company and CFO of Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd..
Mr. Chen Taisong, born in January 1968, Master degree. He was a member, secretary of Siyang Legal
Bureau, and secretary, vice section chief, section chief, director assistant, vice director of Siyang
government office, alcalde and secretary of the party committee of Chuancheng Town in Siyang
country, vice secretary of the party committee and secretary of discipline inspection commission and
chairman of the supervisory committee of Su Wine Industrial Co., Ltd., vice secretary of discipline
inspection committee of the Company. At present, he is a supervisor, member of standing committee,
director of organization department of the Company; vice secretary of the party committee and
secretary of discipline inspection committee and chairman of the supervisory committee of Su Wine
Trade Group.
Mr.Xu youheng, born in March 1977, Master degree. He has served successively as director of
organization department, director of cadre supervision department, director of cadre education
department, director of office, vice director of the office of leading group for party construction of Suqian
municipal party committee. At present, he is the Company’s supervisor, vice secretary of the party
committee and vice general manager of Suqian Industrial Development Group Co., Ltd.
3.3 Senior management
Mr. Zhong Yu, President of the Company, resume as above.
Mr. Liu Huashuang, vice president of the Company, resume as above.
Mr. Cong xuenian, vice president of the Company, resume as above.
Mr. Zhou Xinhu, vice president of the Company, resume as above.
Ms. Lin Qing, born in May 1975, Master degree, senior accountant, CPA. She was a vice director of
enterprise department of Suqian Finance Bureau, director assistant of Suqian Price Bureau, member
and vice director of the party committee of National Development and Reform Commission, member of
the standing committee of the Company, vice president of the Company. At present, she is a member
of the standing committee of the Company, vice president of the Company and director of the internal
audit institution.
Mr. Zheng Bujun, born in January 1967, MBA, senior engineer. He was a general manager of Yanghe
Group, general manager of Suqian State-owned Investment Co., Ltd., vice general manager of
Shuanggou Distillery, director of logistics and purchasing and president assistant of the Company. At
present, he is a vice president, member of the standing committee of the Company, general manager
and secretary of the party committee of Siyang Branch of the Company.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Mr. Fu Hongbin, born in January 1962, Chinese liquor craft master, senior winemaker. He successively
served as the director of the management and quality department of Jiangsu Yanghe Group Co., Ltd.,
vice chief engineer of the Company, director of the quality department, general manager assistant of
Yanghe Branch, the director of the quality department, vice general manager, president assistant of the
Company, and the chairman of the board of directors of Guizhou Guijiu Group Co., Ltd. At present, he
is a vice president of the Company, chairman of the board of directors and secretary of the party
committee of Guizhou Guijiu Group Co., Ltd.
Position in shareholder-holding companies
√ Applicable N/A
Position in Any remunerations
Beginning Ending
Name of shareholder shareholder received from
Name date of office date of
holding companies holding shareholder holding
term office term
companies companies
Zhou Wenqi Shanghai Jieqiang CFO 1 July 2013 Yes
Tobacco Sugar & Wine
(Group) Co.,Ltd.
Wang Kai Shanghai Haiyan Vice general 1 March 2017 Yes
Logistics Development manager
Co.,Ltd.
Feng Pantai Jiangsu Blue Alliance Supervisor 19 July 2019 No
Joint-Stock Co., Ltd.
Position in other companies
Any
remunerations
Name of other Position in other Ending
Name Beginning date received from
companies companies date
other
companies
Xu Zhijian Nanjing University Professor 11 November 2003 Yes
Non-executive Yes
Xu Zhijian Nanjing Port Co., Ltd. 30 March 2016
director
Jiangsu Maysta Non-executive Yes
Xu Zhijian 4 December 2015
Chemical Co., Ltd. director
Glarun Technology Non-executive Yes
Xu Zhijian 12 May 2017
Co.,Ltd. director
Yangzhou Rixing Bio- Non-executive Yes
Xu Zhijian 12 December 2019
Tech Co., Ltd. director
Cai Yunqing Chinese Nutrition Society Supervisor 1 May 2017 No
Jiangsu Intelligent Aged
Cai Yunqing Vice president 1 March 2017 No
Research Association
Cai Yunqing Chinese Nutrition Society Honorary president 1 April 2015 No
State Food and Drug Evaluation experts
Cai Yunqing 1 August 2008 No
Administration of health food
Nanjing Suhe Venture
Chairman of the
Ji Xueqing Capital Center (Limited 1 January 2017 No
board
Partnership)
Xuzhou Zm-Besta Heavy
Ji Xueqing Supervisor 1 March 2017 No
Steel Structure Co., Ltd
China Soft Investment
Ji Xueqing Partner 1 January 2017 No
Group
Ji Xueqing Nanjing Balance Network Non-executive 1 October 2017 Yes
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Technology Co., Ltd. director
NanJing Liandi
Non-executive
Ji Xueqing Information Systems 1 January 2017 No
director
Co.,Ltd.
Jiangsu Efful Science
Ji Xueqing Supervisor 1 March 2018 No
and Technology Co.,Ltd
China University
Innovation and
Ji Xueqing Vice president 1 July 2018 No
Entrepreneurship
Incubator Alliance
Nanjing Liheng
Ji Xueqing Director 15 October 2019 No
Investment Co.,Ltd.
Quality Operation and
Safety Management
Chen Tongguang Director 1 October 2013 Yes
Department in Yangzhou
University
Yangzhou Yangjie
Non-executive
Chen Tongguang Electronic Technology 19 June 2017 Yes
director
Co.,Ltd.
Punishments imposed in the recent three years by the securities regulators on the incumbent directors,
supervisors and senior management as well as those who left in the reporting period
Applicable √ N/A
4. Remuneration of directors, supervisors and senior management
The decision-making procedures, decision basis and actual remuneration payment of directors,
supervisors and senior management.
Decision-making procedures: Implementation is based on the "Trial Implementation Measures for the
Annual Salary of General Manager (Revision)” approved by the 9th meeting of the second board of
directors on 29 December 2008 and "Trial Implementation Measures for the Annual Salary of Chairman
of the Board (Revision)” approved by the first extraordinary general meeting of shareholders on 18
January 2009.
Decision basis: Based on the Company's operating conditions and considering the standard of regional
economic, industry and market.
Actual remuneration payment: Based on the performance and payment on time according to the salary
system.
Remuneration of directors, supervisors and senior management during the reporting period
Unit: 0,000CNY
Total before-tax Remuneration
Incumbent/ remuneration from related
Name Position Gender Age
Former from the parties of the
Company Company
Chairman of the
Wang Yao Male 55 Incumbent 145.6 No
board
Vice Chairman of
Zhong Yu the board, Male 56 Incumbent 131.06 No
president
Director, executive
Liu Huashuang Male 50 Incumbent 101.65 No
vice president
Cong Xuenian Director,vice Male 54 Incumbent 100.93 No
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Total before-tax Remuneration
Incumbent/ remuneration from related
Name Position Gender Age
Former from the parties of the
Company Company
president,secretary
of the board,CFO
Director,vice
Zhou Xinhu president,chief Male 58 Incumbent 101.08 No
engineer
Wang Kai Director Male 43 Incumbent 0 Yes
Non-executive
Xu Zhijian Male 56 Incumbent 6 No
director
Non-executive
Cai Yunqing Female 68 Incumbent 6 No
director
Non-executive
Ji Xueqing Male 49 Incumbent 6 No
director
Non-executive
Chen Tongguang Male 54 Incumbent 6 No
director
Chairman of
Feng Pantai supervisory Male 60 Incumbent 98.18 No
committee
Xu Youheng Supervisor Male 43 Incumbent 0 Yes
Zhou Wenqi Supervisor Female 54 Incumbent 0 Yes
Chen Taiqing Supervisor Male 55 Incumbent 100.66 No
Chen Taisong Supervisor Male 52 Incumbent 102.74 No
Lin Qing Vice president Female 45 Incumbent 98.19 No
Zheng Bujun Vice president Male 53 Incumbent 100.43 No
Han Feng Director Male 58 Former 0 Yes
Chen Yiqin Supervisor Male 59 Former 0 No
Zhu Wei Vice president Male 43 Former 112.34 No
Total 1,216.86
Share incentives for directors, supervisors and senior executives in the reporting period
Applicable √N/A
5. Staff in the Company
5.1 Number, functions and educational backgrounds of the staff
Number of in-service staff of the Company 7,130
Number of in-service staff of main subsidiaries 8,669
Total number of in-service staff 15,799
Total number of staff with remuneration during this period 15,799
Number of retirees to whom the Company or its main subsidiaries need to pay retirement pension 0
Functions
Function by category Number of staff
Production personnel 6,023
Sales personnel 5,632
R&D personnel 1,862
Financial personnel 219
Administrative personnel 1,797
Inner retired personnel 266
Total 15,799
Educational backgrounds
Educational background by category Number of staff
Master 298
Bachelor 3,810
Junior college 4,317
Senior high school and below 7,374
Total 15,799
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5.2 Staff remuneration policy
The remuneration consists of basic payments, performance-related payments and benefit float award.
The Company implemented the mechanism of position self-promotion, and prepared the Management
Measures for Position Self-promotion. In respect of quantity, quality, efficiency and economic value of
the work, the Company further improved a quantified and assessable quantitative and qualitative
indicators. It encourages employees to be spontaneous and to improve their work efficiency. It further
improves the Company's management level, and achieves a win-win situation between the Company
and employees
5.3 Staff training plans
In 2019, in order to promote the implementation of training effect, the Company has successfully
explored and innovated Yanghe "2234" training mode centering on "solving problems, improving
efficiency and increasing benefits", and implemented it in each specific training.
Over the past year, for key training objects, the Company orderly promoted the "100" talents, strategic
talents and leading cadres training projects. In order to ensure that new employees and rotating staff
can quickly adapt to their posts, the Company regularly organized training for new employees and the
work of "master leading apprentice". Continuously, the Company improved the management of the
training system, and prepared the Assessment Method for Students of Yanghe University and the
Assessment Method for Lecturers of Yanghe University. Dynamic management of lecturers was
implemented, and 295 lecturers from Yanghe University were evaluated and selected. The Comapny
standardized the job skill level appraisal and effectively promoted the improvement of production skills.
According to the annual training plan, subsidiary companies organized training in marketing, production
technology, functional management and other aspects to improve the business skills and
comprehensive quality of employees. Business departments carry out professional training according to
its business needs. 766 training sessions were organized and 20,455 employees were trained all
around the year.
5.4 Labor outsourcing
Applicable √ N/A
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section X Corporate Governance
1. Basic situation of corporate governance
The Company constantly optimizes corporate governance structure and internal control system to
enhance the corporate governance level strictly according to the Corporate Law, the Securities Law,
The Listed Company Governance Standards, Rules Governing Listing of Stocks on Shenzhen Stock
Exchange and Guidelines on Standard Operation of SME Board Listed Companies on Shenzhen Stock
Exchange and other relevant laws and regulations. The Company operates normatively with sound
corporate governance and normative information disclosure. The situation of corporate governance of
the Company meets the requirements of authority files of listed company corporate governance by
CSRC.
1.1. Shareholders and shareholders’ general meeting
The shareholders' meeting of the Company has clear responsibilities, clear rules of procedure and
effective implementation. According to the regulations such as Articles of Incorporation and Company
Rules of Procedure of The Shareholders’ General Meeting, the Company convenes and holds the
shareholders’ general meeting and discusses business affairs in the meeting normatively. The
Company hires legal advisor to issue the legal opinion for the shareholders’ general meeting; The
Company can treat all shareholders equally, and especially makes minority shareholders have equal
status and fully exercise their own power. The board carried out all the decisions made by the annual
meeting of shareholders carefully.
1.2. Directors and board of directors
The responsibilities of the board of directors are clear and all the directors can perform their duties
conscientiously and responsibly. The directors are elected carefully under the regulations of the
Corporate Law and Articles of Incorporation. The board of the Company consists of 11 directors
including 4 non-executive directors. The structure of the board of directors satisfies the requirements of
laws and regulations. The board discusses business affairs according to Corporate Law and Articles of
Incorporation. All the directors are able to attend the meeting and take responsibilities diligently
according to the Discussion Rules of the Board of Directors, The Working System of Non-executive
Directors, and Behavior Guidelines of Directors of SME Board Listed Companies. All the directors
seriously consider proposals and make scientific and reasonable decisions for significant events. They
also protect the legal interests of the Company and all shareholders. Strategy Committee, Nomination
Committee, Audit Committee, Remuneration and Appraisal Committee are four professional
committees set under the board. The Committees have clear division of work and responsibilities and
fully play professional role to offer scientific and professional suggestions for the decision-making of the
board.
1.3. Supervisors and board of supervisors
The duties of the board of supervisors are clear and all the supervisors can perform their duties
conscientiously and responsibly. The supervisors are elected according to the Corporate Law and the
Articles of Incorporation. The board of supervisors of the Company consists of 5 supervisors, including
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2 staff representative supervisors. The structure of the board of supervisors satisfies the requirements
of laws and regulations. The board of supervisors discusses business affairs according to corporate law
and articles of incorporation. Supervisors can attend the meeting according to the requirements of
Rules of Discussion Rules of the Board of Supervisors. They takes their own responsibilities seriously,
supervises and makes independent suggestions for the Company’s significant events, financial
conditions and the duties of directors and president, thereby, protecting legal interests of the Company
and shareholders.
1.4. Mechanism of evaluation and motivation
The appointment of directors, supervisor and senior managers is open and transparent, which satisfies
the requirements of relevant regulations and laws. The fair and transparent evaluation mechanism of
the management has been built. During the reporting period, the management carried out the
performance assessment according to the goal of annual operation plan. The management takes their
responsibilities seriously and fulfills the duties.
1.5. Relationship between controlling shareholders and listed company
According to the requirement of the Company Law, the controlling shareholders take duties and rights
of sponsor. The Company and the controlling shareholders implement independent accounting of
personnel, assets, finance, organizations and business. They take responsibilities and risks separately.
During the reporting period, controlling shareholders have no priority beyond the rights of shareholders’
general meeting to directly and indirectly affect the decision-marking and operation of the Company.
There is no situation that controlling shareholders damage the legal interests of other shareholders.
There is no significant related party transaction between the Company and the controlling shareholders.
There is no situation that controlling shareholders occupy the funds of the listed company and the listed
company tenders guarantee for controlling shareholders and the subsidiaries.
1.6. Investors relationship management
The Company focuses on the management of investors relationship to protect legal rights of investors.
Except for the duties like diligence or honesty, the chairman of the board, the president, the board
secretary have good communications and interactions with investors through reception of investor
investigation and participating in performance explanation session and broker strategy meeting online.
As the professional organization for investor relationship management, the securities department
strengthens the communication with investors through telephone, email and irm.cninfo.com.cn. It fully
makes sure that investors have right to know and protects their legal interests.
1.7. Stakeholders, environmental protection and social responsibility
The Company fully respects and protects legal interests of stakeholders and fulfills the duties of social
responsibility. The Company strengthens the awareness of social responsibility and achieves the
interest balance among society, government, shareholders, company, employees,etc. They jointly
promote the harmonious and steady development of the Company. The Company advocates the
governance concept of "green brewery and ecological enterprise", and integrates ecological and
environmental protection requirements into the Company's development strategy and corporate
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governance process. While maintaining the sustainable development, the Company actively
participates in social public welfare and takes social responsibilities.
1.8. Information disclosure and transparency
The information disclosure of the Company is implemented according to the requirements of
supervision departments. The Company seriously implements the rules including Information
Disclosure Management Rule and Investors Relationship Management Rule. The Company enhances
the management of information disclosure affairs and takes responsibility of information disclosure
legally and carefully, achieving the accuracy, integrity, fairness, timeliness of information disclosure.
The information can be equally obtained by all shareholders.
1.9. Methods of improving internal control system construction
The Company keeps on enhancing the corporate governance and the internal control system, which
improves the management to a higher level. The Audit Committee fully examines and supervises the
financial condition, the efficiency of internal control, the efficiency and rationality of corporate
governance. The audit department of the Company, as an internal audit unit, carries out regular and
continuous examination on perfection and implement situation of internal control system. It finds the
Internal control defects and improves deficiencies timely, thus the effectiveness of internal control can
be guaranteed. The operation management and anti-risk capacity are enhanced.
Any significant incompliance with the regulatory documents issued by the CSRC supervising the
corporate governance of listed companies.
Yes√ No
No such cases in the reporting period.
2. Independency of businesses, personnel, assets, organizations and
finance which are separate from the controlling shareholder
2.1. In the aspect of business
The Company has independent and integrated business structure and the ability to operate
independently in the market. There is no peer competition between controlling shareholders and the
Company. Besides, there is no such kind of situation that controlling shareholders intervene with
operation of the Company directly or indirectly.
2.2 In the aspect of personnel
The Company has built independent personnel management system and salary management system.
Furthermore, the Company signed labor contracts with employees, chairman of the board, the president,
vice president, the board secretary and the responsible person for the Company’s financial affairs
obtain compensation from the Company rather than the controlling shareholders. The directors, senior
managers and supervisors do not have positions illegally in other companies that have the same or
similar business.
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2.3 In the aspect of assets
There are clear property relations between the Company and controlling shareholders. The Company
owns the independent land usage right and ownership of buildings. The Company independently
registers and manages the properties with setting up accounts and accounting treatment for them.
There is no situation that the controlling shareholders occupy and control the assets of the Company or
intervene the operation management of the assets.
2.4 In the aspect of organization
The Company has well-structured organization system, including the shareholders’ general meeting,
the board of directors, supervisory committee, the management and functional departments. Related
internal management and control system is established for clear division of function and interaction with
each other. It forms an organic whole that ensures the legal operation. There is no affiliation with
functional departments of controlling shareholders.
2.5 In the aspect of finance
Our company has completed and independent organization with professional financial employees.
Independent accounting system and financial management are established. The Company sets bank
accountants, pays taxes and makes financial decisions separately. There is no situation that controlling
shareholders intervene with the financial management of the Company.
3. Horizontal competition
Applicable √N/A
4. Annual meeting of shareholders and special meetings of
shareholders convened during the reporting period
4.1. Meetings of shareholders convened during the reporting period
Investor
Meeting Type participation Convened date Disclosure date Disclosure index
ratio
2018 Annual General meeting Announcement No. 2019-
general meeting of shareholders 78.45% 23 May 2019 24 May 2019 015, disclosed on
of shareholders www.cninfo.com.cn
2019 First
Extraordinary Announcement No. 2019-
extraordinary
general meeting of 76.27% 20 September 2018 21 September 2019 022, disclosed on
general meeting
shareholders www.cninfo.com.cn
of shareholders
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4.2. Special meetings of shareholders convened at the request of preference
shareholders with resumed voting rights
Applicable √ N/A
5. Performance of non-executive directors during the reporting period
5.1. Attendance of non-executive directors in board meeting and meeting of
shareholders
Attendance of non-executive directors in board meeting
Presence due Presence Presence by Presence
Non-executive Absence(time Absence for two Presence
in the reporting on telecommunic through a
director s) consecutive times (times)
period(times) site(times) ation(times) proxy(times)
Xu Zhijian 5 4 1 0 0 No 2
Cai Yunqing 5 4 1 0 0 No 1
Ji Xueqing 5 4 1 0 0 No 1
Chen
5 4 1 0 0 No 1
Tongguang
Explanation of absence of non-executive directors in meetings of the board for twice
N/A
5.2. Objections from non-executive directors in related issues of the company
Whether there are any objections on related issues of the Company from non-executive directors
Yes √ No
No such cases in the reporting period.
5.3. Other details about the performance of duties by non-executive directors
Whether there are any suggestions from non-executive directors adopted by the Company?
√ Yes No
Explanation about advice of non-executive directors is adopted by the Company or not
Company adopted the advice of non-executive directors.
6. Performance of duties by special committees under the broad during
the reporting period
1).During the reporting period, the Strategic Committee held 1 meeting. It investigated 2018 the board
work report in advance, made the 2019 annual work plan, offered scientific and reasonable suggestions
and fulfilled the duties.
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2).During the reporting period, the Nominations Committee held 1 meeting. It examined the qualification
of Candidates nominated for senior management to be appointed. The committee fulfilled the duties.
3).During the reporting period, the Audit Committee held 4 meetings. It earnestly urged the internal
audit department to carry out daily audit and special audit, strictly examined the implementation of
internal control system related to financial report and daily operation, and actively coordinated and
supervised the audit and reappointment of accountants. The committee fulfilled the duties.
4).During the reporting period, the Remuneration and Appraisal Committee held 1 meeting. It examined
and supervised the salary of directors, senior managers and remuneration performance in 2018.The
information disclosure of the Company about the salary of directors and senior managers is correct and
true and as the same as the examination. The committee fulfilled the duties.
7. Performance of duties by the supervisory committee
Whether there are any risks to the Company identified by supervisory committee when performing its
duties during the reporting period.
Yes √ No
No such cases in the reporting period.
8. Evaluation and motivation mechanism for the senior management
At the beginning of the establishment of the evaluation and motivation mechanism, it was explicitly
illustrated in Trial Implementation Measures for the Annual Salary of General Manager (Revision). The
evaluation and motivation of senior managers are mainly reflected in annual salary system. The board
of directors evaluates and motivates the senior managers mainly according to the satisfaction of clients,
safety index, quality index and financial index. The management implements the annual salary system.
The basic part of annual salary is paid monthly on average and the remaining part will be paid at the
end of the year according to the results of evaluation. If it does not reach the evaluation index, the
remaining parts will not be paid. In 2019, based on the above rules, the Remuneration and Appraisal
Committee examined the situation of the management’s performance in 2018. In 2018, based on
strategic planning for long-term development, the management has achieved the main purpose of
sustainable development.
9. Internal control
9.1. Significant internal control deficiencies found in the reporting period
Yes √ No
9.2. Internal control self-assessment report
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Disclosure date of the internal
29 April 2020
control self-assessment report
Disclosure index of the internal The internal control self-assessment report disclosed on www.cninfo.com.cn on 29
control self-assessment report April 2020
Ratio of the total assets of the
appraised entitles to the 99.03%
consolidated total assets
Ratio of the operating revenues
of the appraised entitles to the 99.30%
consolidated operating revenue
Defect identification standard
Type Financial-report related Non-financial-report related
(1) The indicators of significant deficiencies of
financial report including ：i. Corrupt
transaction of directors,senior managers and
supervisors；ii. The management cannot
figure out the significant misstatement during If condition below appears, it can be
the operation process of operation, but these considered as significant
misstatements are found by others ；iii. deficiencies, others can be divided
Based on the results of evaluation of internal into material defect or general defect
control, the significant deficiencies are not according to impact extent.：(1) The
rectified；iv. Audit Committee and Internal Company suffer from serious
Audit Agency are not effective in supervising mistakes and major property loss
the internal control.(2) The indicators of due to lake of democratic decision-
making procedures or unscientific
material deficiencies including：i. Accounting
Qualitative standard procedures；(2) Violate national
policy has not been chosen or used under the
general accepted accounting principles；ii. regulations and laws seriously；(3)
The anti-fraud program and control measures Lake of important management
have not been built；iii. The controlling system or it doesn’t work；(4)
system or compensation system of Significant or material deficiencies of
accounting treatment of irregular or special internal control cannot be regulated
trade has not formed；iv. The control of the in time；(5)Material deficiencies of
process of financial reporting at the period internal control appear continuously
end exist the situation that one or more or in quantity.
deficiencies are found and the veracity and
accuracy cannot be proved.(3) general
control deficiencies refers to the other control
defects except for significant defects and
important defects above.
Significant deficiencies:Misstatement> 3% of
total operating revenue;Misstatement > 5% of
gross profits;Misstatement > 2% of total
Significant deficiencies:ratio of loss
assets.
of total assets≥1%.
Material deficiencies:1% of total operating
Material deficiencies: 0.5%≤ratio of
revenue < Misstatement≤3% of total
Quantitative standard loss of total assets＜1%
operating revenue;3% of gross profits<
Misstatement≤5% of gross profits; 1% of total General deficiencies:ratio of loss of
assets< Misstatement≤2% of total assets. total assets＜0.5%
General deficiencies: Misstatement≤1% of
total operating revenue; Misstatement≤3% of
net profits;Misstatement≤1% of total assets
Number of financial-report
0
significant defects
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Number of non-financial-report
0
significant defects
Number of important financial-
0
report related defects
Number of important Non-
0
financial-report related defects
10. Auditor’s report on internal control
Auditor’s report on internal control
Reviewed opinion paragraph in internal control audit report
We believe that Yanghe Brewery Joint-Stock maintained effective internal control over financial reporting in all material
respects on 31 December 2019 in accordance with the basic standards for corporate internal control and relevant
regulations.
Disclosure of internal control
Disclosure
audit report
Date of disclosure of internal
29 April 2020
control audit report
Index to disclosure of internal The internal control self-assessment report disclosed on www.cninfo.com.cn on 29
control audit reports April 2020
Opinion types of internal control
Standard and unqualified opinion
audit report
Whether there are material
deficiencies in non-financial No
reporting
Whether the accounting firm issues the internal control audit report of the non-standard opinion
□ Yes √ No
Whether the internal control audit report issued by the accounting firm is consistent with the self-
evaluation report of the board of directors
√ Yes □ No
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section XI Information about Corporate Bond
Whether there exists a public issue and listing of corporate bond that is not yet due or
failed to be redeemed at the date of the financial report authorized.
No
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section XII Financial Report
I.Auditor’s report
Type of audit report Standard and unqualified opinion
Date of signature 28 April 2020
Name of Audit Suya Jincheng Certified Public Accountants LLP
No. of auditor’s report Suya Audit [2020] No.567
Names of auditors Kan Baoyong, Li Yan
Auditor’s Report
To the shareholders of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.:
Opinion
We have audited the financial statements of Jiangsu Yanghe Brewery Joint-Stock Co.,
Ltd. (hereinafter referred to as the “Company”), which comprise the consolidated balance
sheet and balance sheet as at 31 December 2019, consolidated income statement and
income statement, consolidated cash flow statement and cash flow statement,
consolidated statement of changes in owners' equity and statement of changes in
owners' equity for the year then ended and notes to the financial statements.
In our opinion, the attached financial statements are prepared, in all material respects, in
accordance with Accounting Standards for Business Enterprises and present fairly the
financial position of the company as at 31 December 2019 and its operating results and
cash flow for the year then ended.
Basis for opinion
We conducted our audit in accordance with China Standards on Auditing (“CSAs”) for
Certified Public Accountants. Our responsibilities under those standards are further
described in the Auditor's Responsibilities for the Audit of the Financial Statements
section of our report. We are independent of the Company in accordance with the Code
of professional ethics for Certified Public Accountants in China (“the Code”), and we have
fulfilled our other ethical responsibilities in accordance with the Code. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the consolidated financial statements of the current period.
These matters were addressed in the context of our audit of the consolidated financial
statements as a whole and, in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
1.Recognition of revenue
Please refer to accounting policies in Note 22 of Notes V. Significant accounting policies
and accounting estimates, and Note 31 of Notes Ⅶ.Notes to the main items of the
consolidated financial statements.
How our audit addressed the key audit
Key audit matters
matter
The Company’s specific condition of Our procedures in relation to revenue
revenue recognition is that revenue is recognition included:
recognized after customer acceptance (1)Understood, tested and evaluated the
based on payment received or obtaining effectiveness of internal control of sales and
the rights of claiming payment for goods cash receipts cycle designed and executed by
according to signed sales contracts or the management.
agreements. In 2019, the Company’s (2)Judged whether there is an abnormal
annual operating revenue was CNY fluctuation of revenue in the reporting period
23.126 billion. The amount substantial with the analytic review of revenue and gross
and operating revenue is an important profit margin in combination with product
component of income statement. category.
Therefore, we identified operating (3)Sampling inspection of supporting
revenue as a key audit matter. documents related to revenue recognition
including sales contracts or orders, invoices,
delivery lists or receiving reports, shipping lists
and bank slips.
(4)Implemented the external confirmation of
selected major franchisers and inspected the
payback of account receivables after the
reporting period in combination with audit of
accounts receivable.
(5)Sampling inspection of calculation and
accounting treatment of sales discount and
sales allowance
(6)Chose samples from sales revenue records
before and after the balance sheet date,
inspected related supporting documents and
evaluated whether the revenue recorded in the
appropriate accounting period.
2. Existence, valuation and allocation of inventories
Please refer to accounting policies in Note 11 of Notes V.Significant accounting policies
and accounting estimates and Note 7 of Notes Ⅶ. Notes to the Main Items of the
Consolidated Financial Statements.
How our audit addressed the key audit
Key audit matters
matter
As at 31 December 2018, the book value Our procedures in relation to existence,
of inventory is CNY 114.433 billion, valuation, allocation of inventories included:
accounting for 27.00% of the total assets (1)Understood and evaluated the effectiveness
and 38.18% of all current assets. The of management's design and implementation
book value of the inventories at year end of inventory-related internal control.
is relatively large and accounts for a (2)Carried out the inventory analysis review
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
relatively large proportion of the total procedure.
assets at year end. Therefore, the (3)Implement stock-taking procedures at the
existence, valuation and apportionment end of the period.
of inventories are identified as a key audit (4)Sample check of production cost calculation
matter. table and other cost accounting data, and
conducted valuation test on inventory, and
evaluated the accuracy of closing balance of
inventory.
(5)Obtained the calculation table of provision
for stock obsolescence, conduct the inventory
impairment test, reviewed the inventory
impairment test process, and checked whether
the provision for stock obsolescence is made
sufficiently.
Other information
The directors of the Company are responsible for the other information. The other
information comprises the information included in the annual report, but does not include
the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the
other information and, in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material
misstatement of this other information; we are required to report that fact. We have
nothing to report in this regard.
Responsibilities of directors and those charged with governance for the
financial statements
The directors of the Company are responsible for the preparation of the financial
statements that give a true and fair view in accordance with the disclosure requirements
of Accounting Standards for Business Enterprises, and designing, implementing and
maintaining internal control that is necessary to ensure the financial statements are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Company or to cease operations, or have no
realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial
reporting process.
Auditor's responsibilities for the audit of the financial statements
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit conducted in accordance
with CSAs will always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
As part of an audit in accordance with CSAs, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
(1)Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
(2)Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances.
(3)Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
(4)Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the Company’s
ability to continue as a going concern. If we conclude that a material uncertainty exists,
we are required to draw attention in our auditor’s report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Company to cease to
continue as a going concern.
(5)Evaluate the overall presentation, structure and content of the financial statements,
including the disclosures, and whether the financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
(6)Obtain sufficient and appropriate audit evidence regarding the financial information of
the entities or business activities within the Company to express an opinion on the
financial statements. We are responsible for the direction, supervision and performance
of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide the governance with a statement that we have complied with relevant
ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with the governance, we determine those matters that
were of most significance in the audit of the consolidated financial statements of the
current period and are therefore the key audit matters. We describe these matters in our
95
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Suya Jincheng Certified Public Accountants LLP
Nanjing, China
Kan Baoyong
Certified Public Accountant of China
Li Yan,
Certified Public Accountant of China
28 April 2020
II.Financial statements
The unit of statement in financial notes is: CNY
Prepared by: Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Consolidated balance sheet
As at 31 December 2019
Unit: CNY
Item Balance as at 31 December, Balance as at 31 December,
2019 2018
Current assets:
Cash and cash equivalents 4,300,144,848.67 3,615,348,307.97
Settlement reserves
Lending funds
Financial assets held for trading 17,976,767,209.45
Financial assets measured at fair
value through current profit or loss
Derivative financial assets
Notes receivables 659,266,780.81 242,542,097.76
Accounts receivables 16,080,618.65 5,419,314.60
Account receivables financing
Prepayment 200,115,325.19 18,984,169.54
Premiums receivable
Reinsurance accounts receivable
Reinsurance contract reserve
Other receivables 37,521,590.52 47,908,184.37
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Including:Interests receivable
Dividends receivable
Buying back the sale of financial
assets
Inventories 14,433,244,696.27 13,892,118,587.74
Contract assets
Assets held for sale
Non-current assets due within one
1,120,000,000.00
year
Other current assets 183,119,654.47 16,932,480,348.96
Total current assets 37,806,260,724.03 35,874,801,010.94
Non-current assets:
Disbursement of loans and
advances
Investment in debt instruments
Available-for-sale financial assets 2,713,455,624.66
Investment in other debt
instruments
Held-to-maturity investments
Long-term receivables
Long-term equity investments 25,361,651.38 9,423,328.82
Investment in other equity
instruments
Other non-current financial assets 5,050,851,671.16
Investment property
Fixed assets 7,256,557,503.85 7,833,665,282.19
Construction in progress 263,153,505.12 154,535,104.82
Productive biological assets
Oil and gas assets
Right-of-use asset
Intangible assets 1,747,134,144.14 1,781,961,687.10
Development expenses
Goodwill 276,001,989.95 276,001,989.95
Long-term deferred expenses 254,143.60 907,636.00
Deferred tax assets 825,064,057.57 714,003,966.82
Other non-current assets 204,398,450.18 205,012,184.92
Total non-current assets 15,648,777,116.95 13,688,966,805.28
Total assets 53,455,037,840.98 49,563,767,816.22
Current liabilities:
Short-term loans
Borrowings from the central bank
Loans from other banks
Financial liabilities held for trading
Financial liabilities measured at fair
value through current profit or loss
Derivative financial liabilities
Notes payable
Accounts payables 1,330,649,116.82 1,261,282,397.89
Advance from customer 6,753,595,187.64 4,468,409,150.75
Contract liabilities
Financial assets sold for repurchase
Customer brokerage deposits
Securities underwriting brokerage
deposits
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Receivings from vicariously sold
securities
Employee benefits payable 116,094,163.25 185,751,373.59
Taxes payable 1,815,288,006.47 3,255,458,759.72
Other payables 6,521,146,762.07 6,457,301,511.01
Including:Interests payable
Dividends payable
Handling charges and commissions
payable
Reinsurance accounts payables
Liabilities held for sale
Non-current liabilities due within one
year
Other current liabilities
Total current liabilities 16,536,773,236.25 15,628,203,192.96
Non-current liabilities:
Insurance contract reserves
Long-term loans 72,723.00 109,088.00
Bonds payable
Including: Preference shares
Perpetual bonds
Lease liabilities
Long-term payables 197,623,728.85 198,404,248.85
Long-term payroll payables
Accrued liabilities
Deferred income 89,756,500.00 98,513,500.00
Deferred tax liabilities 139,259,083.16 14,019,256.05
Other non-current liabilities
Total non-current liabilities 426,712,035.01 311,046,092.90
Total liabilities 16,963,485,271.26 15,939,249,285.86
Shareholders' equity
Share capital 1,506,988,000.00 1,506,988,000.00
Other equity instruments
Including: preference shares
Perpetual bonds
Capital reserves 741,532,550.13 741,704,076.44
Less: treasury stock
Other comprehensive income -3,608,771.16 -141,964,710.15
Special reserves
Surplus reserves 753,494,000.00 753,494,000.00
General risk reserve
Undistributed profits 33,510,429,712.50 30,784,308,899.94
Total equity attributable to
36,508,835,491.47 33,644,530,266.23
owners of the parent company
Non-controlling interests -17,282,921.75 -20,011,735.87
Total owners' equity 36,491,552,569.72 33,624,518,530.36
Total liabilities and owners'
53,455,037,840.98 49,563,767,816.22
equity
Legal representative: Wang Yao
Person in charge of accounting affairs: Cong Xuenian
Person in charge of accounting department: Yin Qiuming
Balance sheet of parent company
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
As at 31 December 2019
Unit: CNY
Item Balance as at 31 December Balance as at 31 December
2019 2018
Current assets:
Cash and cash equivalents 3,741,676,596.22 1,849,574,170.07
Financial assets held for trading 6,991,814,305.98
Financial assets measured at fair
value through current profit or loss
Derivative financial assets
Notes receivables 493,500.00 143,456,446.32
Accounts receivables 900,252,229.11 697,277,202.71
Account receivables financing
Prepayment 110,564,280.51 250,592,759.90
Other receivables 8,154,899,373.55 949,089,213.52
Including:Interests receivable
Dividends receivable 713,143.77
Inventories 10,476,945,420.09 10,378,077,915.50
Contract assets
Assets held for sale
Non-current assets due within one
700,000,000.00
year
Other current assets 303,163.88 12,338,796,250.84
Total current assets 30,376,948,869.34 27,306,863,958.86
Non-current assets:
Investment in debt instruments
Available-for-sale financial assets 1,231,283,468.30
Investment in other debt
instruments
Held-to-maturity investments
Long-term receivables
Long-term equity investments 7,964,291,378.23 7,365,139,180.24
Investment in other equity
instruments
Other non-current financial assets 1,467,783,926.91
Investment property
Fixed assets 4,641,909,489.16 5,008,615,512.59
Construction in progress 183,652,813.42 92,262,796.92
Productive biological assets
Oil and gas assets
Right-of-use asset
Intangible assets 1,230,216,202.93 1,252,482,032.31
Development expenses
Goodwill
Long-term deferred expenses
Deferred tax assets 6,181,509.39 5,734,535.64
Other non-current assets 170,318,838.68 179,613,182.42
Total Non-current Assets 15,664,354,158.72 15,135,130,708.42
Total Assets 46,041,303,028.06 42,441,994,667.28
Current liabilities:
Short-term loans
Financial liabilities held for trading
Financial liabilities measured at fair
value through current profit or loss
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Derivative financial liabilities
Notes payable
Accounts payables 1,066,947,279.95 1,159,053,261.86
Advance from customer 16,238,064,053.40 14,339,833,591.92
Contract liabilities
Employee benefits payable
Taxes payable 202,771,495.61 1,069,550,625.85
Other payables 180,236,563.85 183,715,786.65
Including:Interests payable
Dividends payable
Liabilities held for sale
Non-current liabilities due within one
year
Other current liabilities
Total current liabilities 17,688,019,392.81 16,752,153,266.28
Non-current liabilities:
Long-term loans 72,723.00 109,088.00
Bonds payable
Including：preference shares
Perpetual bonds
Lease liabilities
Long-term payables 144,680,616.65 145,105,136.65
Long-term payroll payables
Provisions
Deferred income
Deferred tax liabilities 49,541,198.05
Other non-current liabilities
Total non-current liabilities 194,294,537.70 145,214,224.65
Total liabilities 17,882,313,930.51 16,897,367,490.93
Owners' equity (or shareholders'
equity)
Share capital 1,506,988,000.00 1,506,988,000.00
Other equity instruments
Including: preference shares
Perpetual bonds
Capital reserves 1,341,628,480.93 1,341,628,480.93
Less: treasury stock
Other comprehensive income
Special reserves
Surplus reserves 753,494,000.00 753,494,000.00
Undistributed profits 24,556,878,616.62 21,942,516,695.42
Total owners' equity 28,158,989,097.55 25,544,627,176.35
Total liabilities and owners'
46,041,303,028.06 42,441,994,667.28
equity
Consolidated Income Statement
For the year ended 31 December 2019
Unit: CNY
Item Year 2019 Year 2018
1. Total operating revenue 23,126,476,885.07 24,159,801,994.68
Including:Operating revenue 23,126,476,885.07 24,159,801,994.68
Interest income
Earned premium
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Fee and commission income
2. Total operating costs 14,457,584,017.39 14,351,265,484.05
Including: cost of sales 6,626,362,251.24 6,353,242,198.27
Interest expense
Handling charges and commission
expenses
Refunded premiums
Net payments for insurance claims
Net provision for insurance contracts
Bond insurance expense
Reinsurance expenses
Taxes and surcharges 3,201,479,826.09 3,769,929,974.08
Selling and distribution expenses 2,691,711,170.59 2,561,401,628.22
General and administrative expenses 1,856,491,727.00 1,704,265,102.61
Research and Development
159,965,593.88 27,565,217.63
expenses
Financial expenses -78,426,551.41 -65,138,636.76
Including:Interest expenses 2,618.00 3,273.00
Interest income 77,589,503.94 69,133,580.05
Plus: Other income 84,977,755.15 63,352,983.06
Investment income ("-" for losses) 850,554,207.62 918,292,794.49
Including: income from investment in
-4,447,288.34 1,819,591.30
associates and joint ventures
Disposal of financial instruments at
amortised cost ("-" for losses)
Foreign exchange gains ("-" for
losses)
Net exposure to hedging gains("-"for
loss)
Gains from the changes in fair values
158,679,505.33
(“-“ for losses)
Losses from credit impairment ("-" for
-18,956,346.26
losses)
Losses from asset impairment ("-" for
-2,248,496.85 -1,098,948.45
losses)
Gains from disposal of assets ("-" for
19,983,101.67 24,568,477.22
losses)
3. Operating profits ("-" for losses) 9,761,882,594.34 10,813,651,816.95
Plus: non-operating income 22,245,954.37 37,931,006.18
Less: non-operating expenses 13,324,291.70 12,397,034.29
4. Total profits before tax ("-" for
9,770,804,257.01 10,839,185,788.84
total losses)
Less: income tax expenses 2,384,713,341.80 2,723,855,894.34
5. Net profit ("-" for net loss) 7,386,090,915.21 8,115,329,894.50
Classification by operating continuity
Net profit from continuing operation
7,386,090,915.21 8,115,329,894.50
("-" for losses)
Net profit from discontinued operation
("-" for losses)
Classification by owners
Attributable to owners of the parent
7,382,822,726.87 8,115,189,794.69
company
Attributable to non-controlling
3,268,188.34 140,099.81
interests
6.Net of tax from other -2,228,748.45 -142,861,056.33
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
comprehensive income
Net of tax from other comprehensive
income to the owner of the parent -2,238,030.31 -142,880,414.18
company
Other comprehensive income cannot
reclassified into the profit and loss:
Including: Changes in remeasured
defined benefit obligations
Share in other comprehensive
income that cannot be classified into
profit and loss under equity method
Changes in the fair value of other
equity instruments
Fair value changes in enterprise's
own credit risk
Others
Other comprehensive income that will
-2,238,030.31 -142,880,414.18
be reclassified into the profit and loss
Including: Share in other
comprehensive income that will be
178,619.29
classified into profit and loss under
equity method
Net gain on debt instruments at fair
value through other comprehensive
income
Profit and loss of fair value changes
-140,593,969.30
of financial assets available for sale
The amount of financial assets
reclassified into other comprehensive
income
Hold-to-maturity investments are
reclassified as gains and losses on
financial assets available for sal
Other debt investment credit
impairment provision
Cash flow hedging reserve
Balance arising from the translation of
-2,416,649.60 -2,286,444.88
foreign currency financial statements
Others
Net of tax from other comprehensive
9,281.86 19,357.85
income to non-controlling interests
7. Total comprehensive income 7,383,862,166.76 7,972,468,838.17
Total comprehensive income
attributable to owners of the parent 7,380,584,696.56 7,972,309,380.51
company
Total comprehensive income
attributable to non-controlling 3,277,470.20 159,457.66
interests
8. Earnings per share
(1) Basic earnings per share 4.8991 5.3850
(2) Diluted earnings per share 4.8991 5.3850
Where an enterprise is merged under the same control in the current period, the net profit
realized by the merged party before the merger is: CNY 0.00, and the net profit realized
by the merged party in the previous period is: CNY 0.00.
Legal representative: Wang Yao
Person in charge of accounting affairs: Cong Xuenian
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Person in charge of accounting department: Yin Qiuming
Income statement of parent company
For the year ended 31 December 2019
Unit: CNY
Item Year 2019 Year 2018
1. Operating revenue 9,617,136,329.14 9,720,079,677.82
Less:Cost of sales 5,300,856,882.21 5,063,636,970.41
Taxes and surcharges 2,584,040,346.46 3,135,358,096.00
Selling and distribution expenses 6,153,145.12
General and administrative
981,489,516.86 925,750,206.21
expenses
Research and Development
157,807,557.00 25,250,014.30
expenses
Financial expenses -56,610,787.22 -39,822,309.22
Including: Interest expenses 2,618.00 3,273.00
Interest income 58,715,233.69 40,645,696.27
Plus: Other income 15,964,590.12 10,553,184.71
Investment income ("-" for losses) 6,858,473,174.64 6,719,750,712.77
Including: income from investment
in associates and joint ventures
Disposal of financial instruments at
amortised cost ("-" for losses)
Net exposure to hedging gains ("-
"for loss)
Gains from the changes in fair
-106,912,987.67
values (“-“ for losses)
Losses from credit impairment ("-"
-3,495,447.82
for losses)
Losses from asset impairment ("-"
-2,248,496.85 -291,592.62
for losses)
Gains from disposal of assets ("-"
9,155,544.78 26,210,243.55
for losses)
2. Operating profits ("-" For
7,414,336,045.91 7,366,129,248.53
Losses)
Plus: non-operating income 3,926,021.74 4,826,890.48
Less: non-operating expenses 4,260,647.57 11,501,547.44
3. Total profits before tax ("-" For
7,414,001,420.08 7,359,454,591.57
Total Losses)
Less: income tax expenses 207,035,832.38 311,578,769.83
4. Net profit ("-" For Net Loss) 7,206,965,587.70 7,047,875,821.74
Net profit from continuing operation
7,206,965,587.70 7,047,875,821.74
("-" for losses)
Net profit from discontinued
operation ("-" for losses)
5.Net of tax from other
comprehensive income
Other comprehensive income
cannot reclassified into the profit
and loss:
Including: Changes in remeasured
defined benefit obligations
Other comprehensive income that
cannot be transferred under the
equity method
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Net gain on equity instrument at fair
value through other comprehensive
income
Fair value changes in enterprise's
own credit risk
Others
Other comprehensive income that
will be reclassified into the profit and
loss
Including: Share in other
comprehensive income that will be
classified into profit and loss under
equity method
Net gain on debt instruments at fair
value through other comprehensive
income
Profit and loss of fair value changes
of financial assets available for sale
The amount of financial assets
reclassified into other
comprehensive income
Hold-to-maturity investments are
reclassified as gains and losses on
financial assets available for sale
Other debt investment credit
impairment provision
Cash flow hedging reserve
Balance arising from the translation
of foreign currency financial
statements
others
6. Total comprehensive income 7,206,965,587.70 7,047,875,821.74
7. Earnings per share
(1)Basic earnings per share
(2)Diluted earnings per share
Consolidated Statement of Cash Flows
For the year ended 31 December 2019
Unit: CNY
Item Year 2019 Year 2018
1. Cash flows from operating
activities
Cash received from sale of goods
28,157,803,517.41 28,105,243,671.54
and rendering of services
Net increase in customer bank
deposits and placement from banks
and other financial institutions
Net increase in loans from central
bank
Net increase in loans from other
financial institutions
Premiums received from original
insurance contracts
Net cash received from reinsurance
business
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Net increase in deposits and
investments from policyholders
Cash received from interest,
handling charges and commissions
Net increase in placements from
other financial institutions
Net capital increase in repurchase
business
Net cash received for the sale of
securities
Refunds of taxes and surcharges
Cash received from other operating
260,350,164.67 1,493,570,444.98
activities
Sub-total of cash inflows from
28,418,153,682.08 29,598,814,116.52
operating activities
Cash paid for goods purchased and
6,764,469,880.73 7,042,490,432.34
services received
Net increase in loans and advances
to customers
Net increase in deposits in central
bank and other banks and financial
institutions
Cash paid for original insurance
contract claims
A net increase in divested funds
Cash paid for interests, handling
charges and commissions
Cash paid for policy dividends
Cash paid to and on behalf of
2,248,376,328.48 1,786,871,082.15
employees
Cash paid for taxes and surcharges 9,642,918,810.91 8,525,778,929.78
Cash paid for other operating
2,964,496,790.55 3,186,924,855.97
activities
Sub-total of cash outflows from
21,620,261,810.67 20,542,065,300.24
operating activities
Net cash flows from operating
6,797,891,871.41 9,056,748,816.28
activities
2. Cash flows from investing
activities
Cash received from disposal of
39,845,997,675.65 34,357,728,481.60
investments
Cash received from returns on
828,033,083.69 859,477,665.90
investments
Net cash received from disposal of
fixed assets, intangible assets and 24,075,082.94 45,125,913.95
other long-term assets
Net cash received from disposal of
subsidiaries and other business
units
Cash received from other investing
activities
Sub-total of cash inflows from
40,698,105,842.28 35,262,332,061.45
investing activities
Cash paid to acquire and construct
fixed assets, intangible assets and 317,159,366.30 471,045,188.55
other long-term assets
Cash paid for investments 41,674,161,609.88 38,140,628,997.25
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Net increase in pledge loans
Net cash paid to acquire
subsidiaries and other business
units
Cash paid for other investing
activities
Sub-total of cash outflows from
41,991,320,976.18 38,611,674,185.80
investing activities
Net cash flows from investing
-1,293,215,133.90 -3,349,342,124.35
activities
3. Cash flows from financing
activities
Cash received from investors
Including: cash received by
subsidiaries from investments by
minority shareholders
Cash received from borrowings
Cash received from other financing
1,500,000.00
activities
Sub-total of cash inflows from
1,500,000.00
financing activities
Cash paid for debt repayments 36,365.00 36,364.00
Cash paid for distribution of
dividends and profits or payment of 4,822,364,218.00 3,842,822,673.00
interest
Including: dividends and profits paid
to minority shareholders by
subsidiaries
Cash paid for other financing
750,000.00
activities
Sub-total of cash outflows from
4,823,150,583.00 3,842,859,037.00
financing activities
Net cash flows from financing
-4,823,150,583.00 -3,841,359,037.00
activities
4. Effect of fluctuation in
exchange rate on cash and cash 3,270,386.19 -652,223.14
equivalents
5. Net increase in cash and cash
684,796,540.70 1,865,395,431.79
equivalents
Plus: balance of cash and cash
equivalents at the beginning of the 3,615,348,307.97 1,749,952,876.18
period
6. Balance of cash and cash
equivalents at the end of the 4,300,144,848.67 3,615,348,307.97
period
Cash flow statements of parent company
For the year ended 31 December 2019
Unit: CNY
Item Year 2019 Year 2018
1. Cash flows from operating
activities
Cash received from sale of goods
12,584,198,907.24 10,544,075,256.24
and rendering of services
Refunds of taxes and surcharges
Cash received from other operating 132,079,899.80 3,092,072,776.21
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
activities
Sub-total of cash inflows from
12,716,278,807.04 13,636,148,032.45
operating activities
Cash paid for goods purchased and
4,836,044,878.55 5,540,860,474.37
services received
Cash paid to and on behalf of
1,068,195,037.31 757,469,214.50
employees
Cash paid for taxes and surcharges 4,436,521,595.18 3,502,337,711.58
Cash paid for other operating
7,532,523,407.67 622,232,077.34
activities
Sub-total of cash outflows from
17,873,284,918.71 10,422,899,477.79
operating activities
Net cash flows from operating
-5,157,006,111.67 3,213,248,554.66
activities
2. Cash flows from investing
activities
Cash received from disposal of
22,661,938,083.48 23,961,387,686.52
investments
Cash received from returns on
6,816,504,503.68 6,665,894,034.18
investments
Net cash received from disposal of
fixed assets, intangible assets and 11,230,158.55 43,946,408.08
other long-term assets
Net cash received from disposal of
subsidiaries and other business
units
Cash received from other investing
activities
Sub-total of cash inflows from
29,489,672,745.71 30,671,228,128.78
investing activities
Cash paid to acquire and construct
fixed assets, intangible assets and 218,187,673.01 217,004,834.57
other long-term assets
Cash paid for investments 17,400,106,712.99 29,083,948,000.00
Net cash paid to acquire
subsidiaries and other business
units
Cash paid for other investing
activities
Sub-total of cash outflows from
17,618,294,386.00 29,300,952,834.57
investing activities
Net cash flows from investing
11,871,378,359.71 1,370,275,294.21
activities
3. Cash flows from financing
activities
Cash received from investors
Cash received from loans
Cash received from other financing
activities
Sub-total of cash inflows from
financing activities
Cash paid for debt repayments 36,365.00 36,364.00
Cash paid for distribution of
dividends and profits or payment of 4,822,364,218.00 3,842,822,673.00
interest
Cash paid for other financing
activities
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Sub-total of cash outflows from
4,822,400,583.00 3,842,859,037.00
financing activities
Net cash flows from financing
-4,822,400,583.00 -3,842,859,037.00
activities
4. Effect of fluctuation in
exchange rate on cash and cash 130,761.11 -652,488.00
equivalents
5. Net increase in cash and cash
1,892,102,426.15 740,012,323.87
equivalents
Plus: balance of cash and cash
equivalents at the beginning of the 1,849,574,170.07 1,109,561,846.20
period
6. Balance of cash and cash
equivalents at the end of the 3,741,676,596.22 1,849,574,170.07
period
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Consolidated statement of changes in shareholders' equity
For the year ended 31 December 2019
Unit: CNY
Year 2019
Equity attributable to owners of the parent company Non- Total
Other equity controlli sharehol
Other
Item instruments Less： Genera ng ders'
Capital Comprehen Special Surplus Undistribut
Share capital Perpe l risk Others Subtotal interest equity
Preferre Other reserve Treasur sive reserve reserve ed profit
tual y stock reserve s
d stock s Income
bond
1. Balance as
- - 33,624,5
at 31 1,506,988,000. 741,704,0 753,494, 30,784,308, 33,644,530
141,964,710 20,011,7 18,530.3
December of 00 76.44 000.00 899.94 ,266.23
.15 35.87 6
last year
Plus:
adjustments
140,593,969 165,659,685 306,253,65 29,817.6 306,283,
for changes in
.30 .69 4.99 2 472.61
accounting
policies
Adjustments
for correction
of accounting
errors in prior
year
Business
combinations
under
common
control
Others
2. Balance as - - 33,930,8
1,506,988,000. 741,704,0 753,494, 30,949,968, 33,950,783
at January 1 1,370,740.8 19,981,9 02,002.9
00 76.44 000.00 585.63 ,921.22
of the current 5 18.25 7
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
year
3.Increases/d
ecreases in - -
2,560,461,1 2,558,051, 2,698,99 2,560,75
the current 171,526.3 2,238,030.3
26.87 570.25 6.50 0,566.75
year (“-” for 1 1
decreases)
(1) Total -
7,382,822,7 7,380,584, 3,277,47 7,383,86
comprehensiv 2,238,030.3
26.87 696.56 0.20 2,166.76
e income 1
(2) Capital
- - -
contributed or -
171,526.3 578,473. 750,000.
reduced by 171,526.31
1 70 01
owners
Capital
contributions
by owners
Capital
contributions
by other equity
instruments
holders
Amounts of
share-based
payments
recognized in
owners' equity
- - -
-
Others 171,526.3 578,473. 750,000.
171,526.31
1 70 01
- - -
(3) Profit
4,822,361,6 4,822,361, 4,822,36
distribution
00.00 600.00 1,600.00
Withdrawal of
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
surplus
reserves
Withdrawal of
general risk
reserve
Profit
- - -
distributed to
4,822,361,6 4,822,361, 4,822,36
owners (or
00.00 600.00 1,600.00
shareholders)
Others
(4) Internal
carry-forward
of owners'
equity
Conversion of
capital
reserves into
paid-in capital
Conversion of
surplus
reserves into
paid-in capital
Surplus
reserves
offsetting
losses
Amount of
Changes in
setting benefit
plan transfer
to retained
earnings
Other
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
comprehensiv
e income
transferred to
retained
earnings
Others
(5) Special
reserves
Withdrawal for
the period
Use for the
period
Others
4. Balance as
at 31 - - 36,491,5
1,506,988,000. 741,532,5 753,494, 33,510,429, 36,508,835
December of 3,608,771.1 17,282,9 52,569.7
00 50.13 000.00 712.50 ,491.47
the current 6 21.75 2
year
Year 2018
Equity attributable to owners of the parent company
Non-
Other equity Total
controlli
Item instruments Less： Other Genera sharehol
Capital Special Surplus Undistribut ng
Share capital Perpe Treasur Comprehen reserve reserve l risk Others Subtotal ders'
Preferre Other reserve ed profit interest
tual y stock sive Income reserve equity
d stock s s
bond
1. Balance as
- 29,494,8
at 31 1,506,988,000. 741,704,0 753,494, 26,511,938, 29,515,040
915,704.03 20,171,1 69,092.1
December of 00 76.44 000.00 505.25 ,285.72
93.53 9
last year
Plus:
adjustments
for changes in
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
accounting
policies
Adjustments
for correction
of accounting
errors in prior
year
Business
combinations
under
common
control
Others
2. Balance as
- 29,494,8
at January 1 1,506,988,000. 741,704,0 753,494, 26,511,938, 29,515,040
915,704.03 20,171,1 69,092.1
of the 00 76.44 000.00 505.25 ,285.72
93.53 9
current year
3.Increases/d
ecreases in -
4,272,370,3 4,129,489, 159,457. 4,129,64
the current 142,880,414
94.69 980.51 66 9,438.17
year (“-” for .18
decreases)
(1) Total -
8,115,189,7 7,972,309, 159,457. 7,972,46
comprehensiv 142,880,414
94.69 380.51 66 8,838.17
e income .18
(2) Capital
contributed or
reduced by
owners
Capital
contributions
by owners
Capital
contributions
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
by other
equity
instruments
holders
Amounts of
share-based
payments
recognized in
owners' equity
Others
- - -
(3) Profit
3,842,819,4 3,842,819, 3,842,81
distribution
00.00 400.00 9,400.00
Withdrawal of
surplus
reserves
Withdrawal of
general risk
reserve
Profit
- - -
distributed to
3,842,819,4 3,842,819, 3,842,81
owners (or
00.00 400.00 9,400.00
shareholders)
Others
(4) Internal
carry-forward
of owners'
equity
Conversion of
capital
reserves into
paid-in capital
Conversion of
surplus
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
reserves into
paid-in capital
Surplus
reserves
offsetting
losses
Carry-forward
of retained
earnings from
changes in
defined
benefit plans
Other
comprehensiv
e income
transferred to
retained
earnings
Others
(5) Special
reserves
Withdrawal for
the period
Use for the
period
(6) Others
4. Balance as
at 31 - - 33,624,5
1,506,988,000. 741,704,0 753,494, 30,784,308, 33,644,530
December of 141,964,710 20,011,7 18,530.3
00 76.44 000.00 899.94 ,266.23
the current .15 35.87 6
year
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Statement of changes in shareholders' equity of parent company
For the year ended 31 December 2019
Unit: CNY
Year 2019
Other equity instruments Other
Less： Special Total
Item Share Capital Comprehen Surplus Undistributed Other
Preferred Perpetual Treasury reserv shareholder
capital Others reserve sive reserve profit s
stock bond stock e s' equity
Income
1. Balance as at 31 1,506,988,0 1,341,628,48 753,494,000 21,942,516,69 25,544,627,1
December of last year 00.00 0.93 .00 5.42 76.35
Plus: adjustments for
229,757,933.5 229,757,933.
changes in accounting
0 50
policies
adjustments for correction
of accounting errors in
prior year
Others
2. Balance as at January 1,506,988,0 1,341,628,48 753,494,000 22,172,274,62 25,774,385,1
1 of the current year 00.00 0.93 .00 8.92 09.85
3.Increases/decreases
2,384,603,987. 2,384,603,98
in the current year (“-”
70 7.70
for decreases)
(1) Total comprehensive 7,206,965,587. 7,206,965,58
income 70 7.70
(2) Capital contributed or
reduced by owners
Capital contributions by
owners (common stock)
Capital contributions by
other equity instruments
holders
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Amounts of share-based
payments recognized in
owners' equity
Others
- -
(3)Profit distribution 4,822,361,600. 4,822,361,60
00 0.00
Withdrawal of surplus
reserves
- -
Profit distributed to
4,822,361,600. 4,822,361,60
owners (or shareholders)
00 0.00
Others
(4) Internal carry-forward
of owners' equity
Conversion of capital
reserves into paid-in
capital
Conversion of surplus
reserves into paid-in
capital
Surplus reserves
offsetting losses
Amount of Changes in
setting benefit plan
transfer to retained
earnings
Other comprehensive
income transferred to
retained earnings
Others
(5) Special reserves
Withdrawal for the period
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Use for the period
(6) Others
4. Balance as at 31
1,506,988,0 1,341,628,48 753,494,000 24,556,878,61 28,158,989,0
December of the current
00.00 0.93 .00 6.62 97.55
year
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2018
Unit: CNY
Year 2018
Other equity instruments Other
Less： Special Total
Item Share Capital Comprehen Surplus Undistributed Other
Preferred Perpetual Treasury reserv shareholder
capital Others reserve sive reserve profit s
stock bond stock e s' equity
Income
1. Balance as at 31 1,506,988,0 1,341,628,48 753,494,000 18,737,460,27 22,339,570,7
December of last year 00.00 0.93 .00 3.68 54.61
Plus: adjustments for
changes in accounting
policies
adjustments for correction
of accounting errors in
prior year
Others
2. Balance as at January 1,506,988,0 1,341,628,48 753,494,000 18,737,460,27 22,339,570,7
1 of the current year 00.00 0.93 .00 3.68 54.61
3.Increases/decreases
3,205,056,421. 3,205,056,42
in the current year (“-”
74 1.74
for decreases)
(1) Total comprehensive 7,047,875,821. 7,047,875,82
income 74 1.74
(2) Capital contributed or
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
reduced by owners
Capital contributions by
owners (common stock)
Capital contributions by
other equity instruments
holders
Amounts of share-based
payments recognized in
owners' equity
Others
- -
(3)Profit distribution 3,842,819,400. 3,842,819,40
00 0.00
Withdrawal of surplus
reserves
- -
Profit distributed to
3,842,819,400. 3,842,819,40
owners (or shareholders)
00 0.00
Others
(4) Internal carry-forward
of owners' equity
Conversion of capital
reserves into paid-in
capital
Conversion of surplus
reserves into paid-in
capital
Surplus reserves
offsetting losses
Amount of Changes in
setting benefit plan
transfer to retained
earnings
119
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Other comprehensive
income transferred to
retained earnings
Others
(5) Special reserves
Withdrawal for the period
Use for the period
(6) Others
4. Balance as at 31
1,506,988,0 1,341,628,48 753,494,000 21,942,516,69 25,544,627,1
December of the current
00.00 0.93 .00 5.42 76.35
year
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
III. Company profile
Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.(hereinafter referred to as “the Company”)
was established on 26 December 2002, verified by the Government of Jiangsu Province,
details referred to Reply on The approval of Establishment of Jiangsu Yanghe Brewery
Joint-Stock Co., Ltd. by the provincial government (SuZhengFu [2002]No.155), and it
was a joint-stock company founded by Jiangsu Yanghe Group Co.,Ltd., Shanghai Haiyan
Logistics Development Co.,Ltd., Nantong Zongyi Investment Co.,Ltd.,Shanghai Jieqiang
Tobacco Sugar & Wine (Group) Co.,Ltd., Jiangsu Venture Capital Co.,Ltd., China
National Research Institute of Food and Fermentation Industries Co. Ltd., Nantong
Shengfu Industrial Trade Co., Ltd. and Yang Yandong and other totally 14 nature
persons. On 27 December, the Compamy obtained the unified social credit code
(91460000201357188U) issued by Jiangsu Provincial Administration for Industry and
Commerce. The registered capital was CNY 68 million and the share capital was
68,000,000 (CNY 1 per share). According to the documents verified by Jiangsu Provincial
Department of Finance (Su Cai Guo Zi [2002] No.178), all the fund capital converts into
share capital according to the ratio 1:0.65561, among which, Jiangsu Yanghe Group
Co.,Ltd contributed CNY 52,264,100 of evaluated physical assets and CNY 735,900 of
currency, covered into 34,747,330 shares, accounting for 51.099% of the total share
capital; Shanghai Haiyan Logistics Development Co.,Ltd contributed CNY 15,000,000 of
currency, convered into 9,834,150 shares, accounting for the 14.462% of the total share
capital; Nantong Zongyi Investment Co.,Ltd. contributed CNY 15,000,000 of currency,
converted into 9,834,150 shares, accounting for 14.462% of the total share capital;
ShangHai Jieqiang Tobacco Sugar & Wine (Group) Co.,Ltd. contributed CNY 7,000,000
of currency converted into 4,589,270 shares, accounting for 6.749% of the total share
capital; Jiangsu Venture Capital Co.,Ltd. contributed CNY 3,000,000 of currency
concerted into 1,966,830 shares, accounting for 2.892% of the total share capital; China
National Research Institute of Food and Fermentation Industries Co. Ltd. contributed
CNY 1,000,000 of currency, converted into 655,611 shares, accounting for 0.964% of the
total share capital; Nantong Shengfu Industrial Trade Co., Ltd. contributed CNY
1,000,000 of currency, converted into 655,611 shares, accounting for 0.964% of the total
share capital; Yang Yandong and other totally 14 nature persons contributed CNY
8,720,200 of currency, converted into 5,717,050 shares, accounting for 8.408% of the
total share capital.
On 13 September 2009, the Company was verified by China Securities Regulatory
Commission, according to the document Reply on Approving Initial Public Offering of
Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. （Zheng Jian Approval [2009] No.1077）.
The Company announced the initial public offering of 45,000,000 common shares on 27
February 2009 and was listed for transactions in SZSE since 6 November 2009.
According to the decisions of 2010 Shareholders’ General Meeting on 23 April 2011,
based on the total capital of 450,000,000 shares on 31 December 2010, the capital
reserves per 10 shares were converted into 10 shares. After the conversion, the total
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
share capital of the Company was 900,000,000 as well as registered capital of CNY
900,000,000.
According to the decision of 2011 Shareholders’ General Meeting on 17 May 2012,
based on the total capital of 900,000,000 shares on 31 December 2011, the capital
reserves per 10 shares were converted into 2 shares. After the conversion, the total
share capital of the Company was 1,080,000,000 as well as registered capital of CNY
108,000,000.
According to the Proposal of Initial Share Repurchase of Public Shares approved by
2012 Shareholders’ General Meeting on 17 May 2013, the Company used owned funds
to repurchase public shares and the price of public shares was no more than CNY 70.00
per share, as well as the total amount of repurchase shares was no more than CNY 10
billion. The form of repurchase was centralized competitive bidding approved by SZSE.
Until May 2014, the amount of repurchase shares was 3,580,000 and the total amount of
payment CNY 157,793,218.58. The shares repurchased had been canceled according to
the law with the procedure of capital reduction. After the repurchase, the registered
capital became CNY 1,076,420,000 and the total share capital of the Company became
1,076,420,000.
According to the decision of 2014 Shareholders’ General Meeting on 26 May 2015,
based on the total capital of 1,076,420,000 shares on 31 December 2014, the capital
reserves per 10 shares were converted into 4 shares. After the conversion, the total
share capital of the company was 1,506,988,000 as well as the registered capital of CNY
1,506,988,000.
Registered address of the Company: 118 Middle Avenue,Yanghe Town, Suqian City,
Jiangsu Province
Company type: Incorporated company (Listed)
Industry of the Company: Brewing food industry
Business scope of the Company:production and sale of liquor, wholesaling and retailing
of prepackaged food,grain purchase, self-operating and agency of import and export of
various types of merchandise and technology excluding merchandise and technology
limited or prohibited by the state for import and export, domestic trade, construction of e-
commerce platform and online sales.( Business activities of projects needed to be
approved by law must be approved according to related departments）
Parent company of the Company:Jiangsu Yanghe Group Co.,Ltd.
The scope of the Company's consolidated financial statements is based on control, and
all subsidiaries are included in the consolidation scope of the consolidated financial
statements.
Changes of the scope of consolidation are as follows:
Subsidiaries that are newly incorporated into the scope of consolidation are
shown in the following table:
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Name Measure of acquisition
Yanghe Hong Kong Distillery Co., Ltd. Newly establishment
Subsidiaries that are no longer incorporated into the scope of consolidation are
shown in the following table:
Name Reason
Jiangsu Guanmeng Information Technology Liquidation and cancellation
Co., Ltd.
Jiangsu Oubaosi International Trade Co., Ltd. Liquidation and cancellation
Jiangsu Yanghe Packaging Co., Ltd. Liquidation and cancellation
Dream Blue Haichuanhui (Shiyan) Trade and Liquidation and cancellation
Investment Co., Ltd.
Xuzhou Huaqu Wine Development Co., Ltd. Liquidation and cancellation
Details of the subsidiaries incorporated into the consolidated financial statements show
on “Note 8. 1.Interests in subsidiaries”, Changes in the scope of consolidation show on
“Note 9. Change in consolidated scope”.
IV.Basis of preparation of financial statements
1. Basis of preparation
The Company has prepared its financial statements on a going concern basis, and
recognized and measured its accounting items in compliance with the Accounting
Standards for Business Enterprises—Basic Standards and various concrete accounting
standards, and other relevant provisions on the basis of actual transactions and events.
2. Going concern
The Company has sustainable operation ability for at least 12 months from the end of the
reporting period. In addition, there is no significant event affecting going concern.
V. Significant accounting policies and accounting estimates
Whether the Company needs to comply with the requirement of special industry
No
The notes of detailed accounting policies and accounting estimates:
See details in Note V. 27.Changes in significant accounting policies and accounting
estimates.
1. Statement of compliance with the ASBE
The financial statements of the Company have been prepared in accordance with ASBE,
and present truly and completely, the group’s financial position, the Company’s and
123
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
results of operations, and changes in shareholders' equity, cash flows and other related
information for the reporting period.
2. Accounting period
The Company’s accounting period is calendar year as its accounting year, i.e. from 1
January to 31 December.
3. Operating cycle
The Company’s accounting period is 12 months.
4. Functional currency
The Company has adopted China Yuan (CNY) as functional currency.
5. The accounting treatment of business combinations involving
enterprises under common control and not under common control
(1) Accounting treatment method for business combination under common control
Business combination under common control is accounted for under pooling of interest
method.
Assets and liabilities obtained by the Company through business combination under
common control shall be measured at the book value as stated in the combine’s
accounting record on the combination date. The share of the book value of the merged
party’s owner’s equity in the consolidated financial statements is taken as the initial
investment cost of long-term equity investments in individual financial statements. The
capital reserve (stock premium or capital premium) is adjusted according to the
difference between the book value of net asset acquired through combination and the
book value of consideration paid for the combination (or total par value of shares issued).
If the capital reserve (stock premium or capital premium) is insufficient to offset, the
retained earnings shall be adjusted.
(2) Accounting treatment method of business combination not under common control
The Company accounts for business combination not under common control under
purchase method.
a)All the net identifiable assets, liabilities or contingent liabilities obtained by the
Company through business combination not under common control shall be measured at
fair value. Assets paid, liabilities incurred or assumed and the equity securities issued as
consideration for combination are generally measured at fair value on the acquisition
124
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
date, and differences between their fair values and book values shall be included in the
current profit and loss.
b)The cost of acquisition shall be respectively determined for the following conditions;
i.Business combination of a transaction implementation, the combination cost shall be the
sum of the fair value of the assets given, the liabilities incurred or assumed and the
equity securities issued by the Company in exchange for the control on the acquisition
date, and contingent considerations meeting the recognition conditions. The combination
cost is the initial investment costs of long-term equity investments in individual financial
statements.
ii.Business combination through multiple transactions step by step to realized, the
combination cost shall be the sum of the fair value measurement on the acquisition of the
equity investment that holding before the acquisition date and cost of all the new
investment on the acquisition date. Long-term equity investment cost in individual
financial statements shall be the sum of the book value of the equity investment that
holding before the acquisition date and cost of all the new investment on the acquisition
date. A package deal is excluded.
The Company, on the acquisition date, allocates the combination costs between the
identifiable assets and liabilities acquired
i.All assets of the acquiree obtained by the Company through business combination(not
limited to those that have been recognized by the acquiree), other than intangible assets,
shall be separately recognized and measured at fair value when the future economic
benefits arising thereafter are expected to flow into the Company and the fair value can
be reliably measured.
ii.Intangible assets of the acquiree obtained by the Company through business
combination shall be separately recognized and measured at fair value when their fair
values can be reliably measured.
iii. All liabilities of the acquiree obtained by the Company through business combination,
other than contingent liabilities, shall be separately recognized and measured at fair
value when fulfillment of relevant obligations are expected to bring future economic
benefits to the Company and the fair value can be reliably measured.
iv.Contingent liabilities of the acquiree obtained by the Company through business
combination shall be separately recognized as liabilities and measured at fair value when
their fair values can be reliably measured.
v.When the Company allocates the cost of business combination and recognizes the
identifiable assets and liabilities acquired through combination, it shall not include any
goodwill and deferred income taxes that have been recognized by the acquiree before
the business combination.
c) Treatment of the difference between the business combination costs and the fair value
of net identifiable asset acquired from the acquiree through combination
125
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
i.The Company shall recognize the difference of the combination costs in excess of the
fair value of the net identifiable asset acquired from the acquiree through combination as
goodwill.
ii.The Company shall recognize the difference of the combination costs in short of the fair
value of the net identifiable asset acquired from the acquiree through combination
according to the following provisions:
Review the measurement of fair values of all the identifiable assets, liabilities and
contingent liabilities acquired from the acquiree and the combination costs; After the
review, if the combination costs are still in short of the fair value of the net identifiable
asset acquired from the acquiree through combination, include the difference in the
current profit and loss.
(3)Treatment of relevant expenses arising from the Company’s business combination
a) Relevant expenses directly arising from the business combination of the Company
(including the expenses for audit, legal services, evaluation and consultation or other
intermediary costs for business combination) shall be included in the current profit and
loss when they are incurred.
b) Commissions, fees and other expenses paid on issuance of bonds and undertaking of
other debts for the business combination shall be included in the initial measurement
amount of debt securities.
i.Where the bonds are issued at discount or par value, that part of expenses will increase
the amount of the discount;
ii.Where the bonds are issued at premium, that part of expenses will decrease the
amount of the premium.
c) Fees, commissions, and other transaction expenses paid on issuance of equity
securities as combination consideration in the business combination shall be included in
the initial measurement amount of equity securities.
i.Where the equity securities are issued at premium, that part of expenses shall be
deducted from capital reserves (stock premium);
ii.Where the equity securities are issued at par value or discount, that part of expenses
shall be deducted from the retained earnings.
6. Preparation of consolidated financial statements
(1) Consistency of accounting policies and accounting period
All the subsidiaries within the consolidation scope of consolidated financial statements
shall adopt the same accounting policies and accounting periods as those of the
Company. If the accounting policies or accounting periods of a subsidiary are different
from those of the Company, the financial statements of the subsidiary, upon preparation
of consolidated financial statements, shall be adjusted according to the accounting
126
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
policies and accounting periods of the Company.
(2) Preparation method of consolidated financial statements
The consolidated financial statements are based on the financial statements of the
Company and its subsidiaries, and are prepared by the parent company according to
other relevant information after the adjustment to long-term equity investments in
subsidiaries under the equity method and the elimination of effects of the internal
transactions between the Company and its subsidiaries and between the subsidiaries on
the consolidated financial statement.
(3) Reflection of excess losses incurred to a subsidiary in the consolidated financial
statements
In the consolidated financial statements, where the current losses undertaken by the
parent company are in excess of its share of owners’ equity in the subsidiary at the
beginning of the period, the balance shall reduce the owners’ equity (retained earnings)
of the parent company; where the current losses undertaken by a subsidiary’s non-
controlling shareholders excess those non-controlling shareholders’ share of owners’
equity in the subsidiary at the beginning of the period, the balance shall reduce the non-
controlling interests.
(4) Changes in number of subsidiaries during the reporting period
a) Acquisition of subsidiaries during the reporting period
i. Treatment of acquiring subsidiaries from business combination under common control
during the reporting period
During the reporting period, if the Company acquires subsidiaries from the business
combination under common control, the opening balance in the consolidated balance
sheet shall be adjusted. The income, expenses and profits of the newly acquired
subsidiaries from the beginning to the end of the reporting period shall be included in the
consolidated income statement. The cash flows of the newly acquired subsidiaries from
the beginning to the end of the reporting period shall be included in the consolidated
statement of cash flows.
ii. Treatment of acquiring subsidiaries from business combination not under common
control during the reporting period
During the reporting period, if the Company acquires subsidiaries from the business
combination not under common control, the opening balance in the consolidated balance
sheet shall not be adjusted. The income, expenses and profits of the newly acquired
subsidiaries from the acquisition date to the end of the reporting period shall be included
in the consolidated income statement. The cash flows of the newly acquired subsidiaries
127
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
from the acquisition date to the end of the reporting period shall be included in the
consolidated statement of cash flows.
b) Treatment of disposing subsidiaries during the reporting period
During the reporting period, if the Company disposes subsidiaries, the opening balance
in the consolidated balance sheet shall not be adjusted. The income, expenses and
profits of the newly disposed sub diaries from the beginning to the disposal date shall be
included in the consolidated income statement. The cash flows from the beginning to the
disposal date shall be included in the consolidated statement of cash flows.
7. Classification of joint venture arrangements and the accounting
treatment method of common operation
(1) Classification of joint venture arrangements
A joint arrangement is classified as either a joint operation or a joint venture. A joint
operation is a joint arrangement whereby the joint operators have rights to the assets,
and obligations for the liabilities, relating to the arrangement. A joint venture is a joint
arrangement whereby the joint ventures only have the rights to the net assets under this
arrangement.
A joint arrangement that is not structured through a separate vehicle shall be classified
as a joint operation. A separate vehicle refers to a separately identifiable financial
structure, including separate legal entities or entities without a legal personality but
recognized by statute.
A joint arrangement that is structured through a separate vehicle is usually classified as a
joint venture. However, when a joint arrangement provides clear evidence that it meets
any of the following requirements and complies with applicable laws and regulations as a
joint operation:
a) The legal form of the joint arrangement indicates that the parties that have joint control
have rights to the assets, and obligations for the liabilities, relating to the arrangement.
b) The terms of the joint arrangement specify that the parties that have joint control have
the rights to the assets, and the obligations for the liabilities, relating to the arrangement.
c) Other facts and circumstances indicate that the parties that have joint control have
rights to the assets, and the obligations for the liabilities, relating to the arrangement---for
example, the parties that have joint control have rights to substantially all of the output of
the arrangement, and the arrangement depends on the parties that have joint control on
a continuous basis for settling the liabilities of the arrangement.
(2) Accounting treatment of a joint operation
A joint operator shall recognize the following items in relation to its interest in a joint
operation, and account for them in accordance with relevant accounting standards:
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a)Its solely-held assets, and its share of any assets held jointly;
b)Its solely-assumed liabilities, and its share of any liabilities incurred jointly;
c)Its revenue from the sale of its share of the output arising from the joint operation;
d)Its share of the revenue from sale of the output by the joint operation; and
e)Its solely-incurred expenses and its share of any expenses incurred jointly.
8. Cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand.
Cash equivalents are the company’s short-term (due within 3 months from purchase
date), highly liquid investments that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.
9. Foreign currency transactions and translation of foreign currency
statements
(1)Accounting method of foreign currency transactions
a)Initial recognition of foreign currency transactions
For foreign currency transactions incurred, the Company converts the amount in foreign
currency into the amount in functional currency at the spot exchange rate (middle rate)
announced by the People’s Bank of China on the transaction date. Among them, for
foreign currency exchange occurred or transaction involving foreign currency exchange,
the Company converts at the exchange rate actually adopted on the transaction date.
b)Adjustment or settlement on the balance sheet date or settlement date
On the balance sheet date or the settlement date, the Company handles foreign currency
monetary items and foreign currency non-monetary items separately in accordance with
the following methods:
i. Accounting principles for handling foreign currency monetary items
For foreign currency monetary items, on the balance sheet date or the settlement date,
the Company converts them by using the spot exchange rate (middle rate) prevailing on
the balance sheet date or settlement date, and adjusts the amount in functional currency
of foreign currency monetary items in respect of the difference arising from exchange
rate fluctuations, which shall be treated as exchange difference at the same time. Among
them, the exchange differences arising from foreign currency loans relating to the
acquisition, construction or production of assets eligible for capitalization shall be
included in the costs of assets eligible for capitalization; other exchange differences shall
be included in the current financial expenses.
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ii. Accounting principles for handling foreign currency non-monetary items
For foreign currency non-monetary items measured at historical cost, the Company shall
convert them at the spot exchange rate (middle rate) prevailing on the transaction date,
with their amounts in functional currency remaining unchanged and no exchange
differences incurred.
For an inventory that is measured at the lower of its costs or its net realizable values, if
the net realizable value is determined in foreign currency, the Company, when
determining the value of the inventory at the end of the period, shall firstly convert the net
realizable value into functional currency and then compare it with the inventory cost
reflected in functional currency.
Non-monetary items measured at fair value that is reflected in foreign currency at the end
of the period, the Company shall firstly translate the foreign currency into the amount in
functional currency at the spot exchange rate on the date when the fair value is
determined, and then compare it with the original functional currency amount. Difference
between the translated functional currency amount and the original functional currency
amount is treated as profit or loss from changes in fair value (including changes in
exchange rate) and is recognized in current profit and loss.
(2)Accounting treatment method for translation of foreign currency statements
a)The Company shall translate the financial statements of foreign operations in
accordance with the following methods:
i. Assets and liabilities in the balance sheets shall be translated at the spot exchange
rates on balance sheet date. Shareholders ’ equity items, except for the item of
"undistributed profits", are translated at the spot exchange rates on the dates when the
transactions occur.
ii. Revenue and expense items in the income statement are translated at the spot
exchange rates on the dates when the transactions occur or at the exchange rate
determined in a systematical and reasonable method and similar to the spot exchange
rate on the day when the transactions occur.
Differences arising from the above translations of foreign currency financial statements
are separately listed under ‘other comprehensive income’ in the consolidated balance
sheet.
The translation of comparative financial statements is handled by reference to the above
approach.
b)The Company shall translate the financial statements of foreign operations that are in
virulent inflation economy in accordance with the following methods:
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i. The Company restates the items in the balance sheet by using the general price index,
and restates the items in the income statement by using the changes in general price
index, and then converts those items at the spot exchange rate on the latest balance
sheet date.
ii. Where the foreign operations are no longer in virulent inflation economy, the Company
ceases to restate the financial statements and converts the financial statements restated
according to the price level on such cease.
c)Where the Company disposes of an overseas business, it shall transfer the foreign
currency financial statements exchange difference, which relates to the business
disposed of and is presented under the items of the other comprehensive income in the
balance sheet, from the other comprehensive income item to the gain or loss on disposal
for the current period. If the overseas business is partly disposed of, the foreign currency
financial statements exchange difference shall be calculated in proportion to the
percentage of disposal and transferred to gain or loss on disposal for the current period.
10. Financial Instruments
Financial instruments are the financial asset, financial liability or (equity) instrument will
be recognised when the Company became one of the parties under a contract.
(1)Classification of financial instruments
(a)Classification of financial assets
According to the company's business model of managing financial assets and the
characteristics of contract cash flow of financial assets, financial assets are classified into
the following three categories: financial assets measured at amortised cost; financial
assets measured at fair value through other comprehensive income (including financial
assets directly designated to be measured at fair value through other comprehensive
income); and financial assets measured at fair value through the current profit or loss.
(b)Classification of financial liabilities
The Company classifies the financial liabilities into the following two categories: financial
liabilities measured at fair value through current profit and loss (including financial
liabilities held for trading and financial liabilities directly designated to be at fair value
through current profit and loss); and financial liabilities measured at amortized cost.
(2)Recognition basis and measurement method of financial instruments
Recognition basis of financial instruments
When the Company becomes a party to a financial instrument, it shall recognize a
financial asset or financial liability.
Measurement method of financial instruments
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i.Financial assets
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 recognised in
profit or loss for the period. For other categories of financial assets, relevant transaction
costs are included in the amount initially recognised. Accounts receivable or notes
receivable arising from sales of goods or rendering services and without significant
financing component or the company decided not to consider financing elements for less
than one year are initially recognised based on the amount of consideration expected to
be entitled to receive.
① Financial assets measured at amortised cost
These assets are subsequently measured at amortised cost using the effective interest
method after initial recognition. Gains/losses on financial assets that are measured at
amortised cost and are not a part of any hedging relationship shall be recognised in profit
or loss when the financial asset is derecognised or reclassification or amortised using the
effective interest method or recognized the impairment allowance.
② Financial assets measured at fair value through other comprehensive income
These assets are subsequently measured at fair value after initial recognition. Except
impairment, foreign exchange gains and losses, interest income calculated using the
effective interest method are recognised in profit or loss; other gains and losses are
recognised in other comprehensive income. On derecognition, gains and losses
accumulated in other comprehensive income are transferred to profit or loss.
In addition, the company designated some non-tradable equity instruments as financial
assets measured at fair value through other comprehensive income; the company shall
recognise the relevant dividend income of such financial assets into the current profit and
loss, and recognise the change of fair value in other comprehensive income. On
derecognition, the accumulated gains/losses previously recognized in other
comprehensive income shall be transferred to retained earnings and not be recognised in
current profit and loss.
③ Financial assets measured at fair value through profit or loss
The Company classifies the financial assets, except for financial assets measured at
amortized cost or at fair value through other comprehensive income as mentioned above,
into the financial assets measured at fair value through profit or loss for the current period.
In addition, the company may designate some financial assets as financial assets
measured at fair value through profit or loss for the current period upon the initial
recognition to eliminate or significantly reduce accounting mismatch. For such financial
assets, the company adopts the fair value for subsequent measurement, and changes in
fair value are recognized in the profit or loss for the current period.
ii.Financial liabilities
Financial liabilities shall be classified into financial liabilities measured at fair value
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through profit or loss for the current period upon initial recognition and other financial
liabilities. For financial liabilities measured at fair value through profit or loss, relevant
transaction costs are directly recognized in the current profit and loss, and the relevant
transaction costs of other financial liabilities are recognized in the initial recognition
amount.
① Financial liabilities measured at fair value through profit or loss
Financial liabilities held for trading (including derivatives of financial liabilities) shall be
subsequently measured at the fair value. Except for those related to hedge accounting,
changes in the fair value shall be recognized in the profit or loss of the current period. For
financial liabilities designated to be at fair value through profit or loss, fair value changes
caused by the Company's own credit risk changes which is recognised in other
comprehensive income, when the liability is derecognition, the accumulated change in its
fair value caused by the change in its own credit risk recognized in other comprehensive
income is transferred to retained earnings, the remaining changes of fair value is record
in profit of loss. If the above treatment of the impact of the change in the credit risk of
such financial liabilities will cause or expand the accounting mismatch in the profit and
loss, the company will record all the gains/losses of such financial liabilities (including the
amount affected by fair value changes in enterprise's own credit risk) into the current
profit and loss.
② Financial liabilities measured at amortized cost
Except financial liabilities that arise when a transfer of a financial assets does not qualify
for derecognition or when the continuing involvement approach applies security contract
are classified as financial liabilities measured by amortized cost, or financial
subsequently measurement at amortized cost, and record the profits or losses guarantee
contracts recognition or amortization into the current profit and loss.
(3)Financial assets transfer
If the Company transfers substantially all the risks and rewards of ownership of the
financial asset to the transferee, the Company derecognises the financial asset, the
rights and obligations arising or retained in the transfer shall be separately recognized as
its assets or liabilities; if the Company retains substantially all the risks and rewards of
ownership of the financial asset, it continues to recognise the transferred financial assets.
If the Company neither transfers nor retains substantially all the risks and rewards of
ownership of the financial asset, it is accounted for as follows: if the Company has not
retained control, it derecognises the financial asset, the rights and obligations arising or
retained in the transfer shall be separately recognized as its assets or liabilities; and if the
Company has retained control, it continues to recognize the financial asset to the extent
of its continuing involvement in the transferred financial asset and recognizes the
relevant liability.
Where transfer of financial assets qualify for derecognition entirety, the difference
between the following two amounts will be included into current profit or loss: The book
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value measured at the date of derecognition; and The sum of the consideration for the
derecognition part and the portion of derecognition corresponding to the accumulated
amount of the changes in fair value originally and directly included in OCI (involving the
situation where the financial asset transferred is a debt instrument investment measured
at fair value and recognized in other comprehensive income). The Company transferred
the partial transfer of financial assets which qualify for derecognition, the overall carrying
amount of the transferred financial asset shall be apportioned according to their
respective relative fair value between the portion of derecognition and the remaining.
(4)Derecognition of financial liabilities
If the current obligation of the financial liability (or part thereof) has been discharged, the
company shall remove financial liability (or part thereof), and the company shall
recognize the difference between its book value and the consideration paid (including
any non-cash assets transferred or liabilities assumed) in the current profit and loss.
(5)Offsetting of financial assets and liabilities
Financial assets and financial liabilities shall be shown separately in the balance sheet
and shall not be offset against each other. If the following conditions are met at the same
time, the net value offset each other after amount listed in the balance sheet:
The company has offset the confirmed amount of legal rights of financial assets and
financial liabilities, and this kind of legal rights is the executable; and
The company plans to net or cash at the same time when the financial assets and
liquidation of the financial liability.
If the transfer of financial assets does not meet the conditions for derecognition, the
transferor shall not offset the transferred financial assets and related liabilities.
(6)Equity instruments
Equity instruments are contracts that prove ownership of the residual interest in the
company’s assets after deducting all liabilities. The issuance (including refinancing),
repurchase, sale or cancellation of the equity instruments of the company shall be treated
as changes in the equity. The company does not recognize changes in the fair value of
equity instruments, and the transaction fees related to the equity transactions shall be
deducted from the equity. Where the equity instrument of the company distributes
dividends during the term of its existence, it shall be treated as profit distribution, and the
total amount of shareholders' equity will not be affected by the stock dividends issued.
(7)Method for determining the fair value of financial assets and financial liabilities
Where there is an active market for a financial instrument, the company shall determine
its fair value by quoting in the active market. Where there is no active market for the
financial instrument, the company shall determine its fair value by means of valuation
technology. In valuation, the company uses valuation techniques applicable in the current
situation and supported by sufficient available data and other information to select input
values consistent with the characteristics of assets or liabilities considered by market
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participants in transactions of related assets or liabilities, and gives priority to relevant
observable input values as far as possible. Use unobservable inputs only when relevant
observable inputs cannot be obtained or are impracticable to obtain.
Upon initial recognition, the fair value of financial assets or financial liabilities is
determined by the quoted price of the same assets or liabilities in the active market or
other valuation technology that only uses observable market data, the Company defers
the difference between the fair value and the transaction price. After initial recognition,
the Company recognizes the deferred difference as gain or loss in the corresponding
accounting period according to the changes of a certain factor in the corresponding
accounting period.
(8)Impairment of Financial Assets
Based on the expected credit loss, the Company shall recognise the impairment loss on
financial assets measured at amortized cost, debt instrument investment at fair value
through other comprehensive income.
The approach of recognition loss allowance for expected credit losses
Considering the reasonable and valid information such as past events, current conditions
and forecast of future economic conditions, and weighted by the risk of default, the
Company calculates the probability weighted amount of the present value of the
difference between the cash flow receivable under the contract and the expected cash
flow to be received, and confirms the expected credit loss.
General approach
The Company assess whether the credit risk of financial instruments in different stages at
each reporting date has increased significantly. If the financial instruments' credit risk
have not increased significantly after initial recognition, it will be included in phase 1, and
the Company measures the loss allowance for those instruments at an amount equal to
12-month expected credit losses; if the financial instruments' credit risk have increased
significantly but without objective evidence for impairment after initial recognition, it will
be included in phase 2, and the Company measures the loss allowance of those
instruments at an amount equal to lifetime expected credit losses; if the financial asset
that is evidently credit-impaired after initial recognition, it will be included in phase 3, and
the Company measures the loss allowance of those financial instruments at an amount
equal to lifetime expected credit losses. For financial instruments with low credit risk on
the balance sheet date (e.g.fixed deposits in commercial banks with higher credit rating,
financial instruments with external credit rating above "investment grade"), the Company
assumes that the credit risk has not increased significantly since the initial recognition
and chooses to measure the loss provision according to the expected credit loss in the
next 12 months.
Simplified approach
For accounts receivables and notes receivables related to revenues, the Company does
not include the significant financing component or does not consider the financing
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components in contracts less than one year, it will measure the loss allowance according
to the expected credit loss of the whole duration.
Criteria for determining whether credit risk has increased significantly subsequent to the
initial recognition
If the probability of default of a financial asset in lifetime as determined on the balance
sheet date is significantly higher than the probability of default in lifetime as determined at
the initial recognition, the credit risk of the financial asset increases significantly.
No matter what method the Company is applied to evaluate whether credit risk has
increased significantly, it usually inferred that the credit risk of the financial instrument
has increased significantly if the contract payment delay exceeds 30 days, unless the
Company can get the reasonable and valid information at reasonable cost to evidence
that the credit risk of the financial instrument has not increased significantly since the
initial recognition.
Except in special cases, the Company shall use the change of default risk in the next 12
months as a reasonable estimate of the change of default risk in lifetime to determine
whether the credit risk has increased significantly to the initial recognition
Approach of assessing expected credit risk on a portfolio basis and determine basis
The company evaluates credit risk individually for the credit risk of significantly different
notes receivables, accounts receivables and other receivables with the following
characteristics. Such as: accounts receivables in dispute with the other party or involving
litigation or arbitration; notes receivables, accounts receivables that have shown clear
signs that the debtor is likely to be unable to meet repayment obligations.
When it is impossible to evaluate the expected credit loss information of an individual
financial asset at a reasonable cost, the Company divides the receivables into several
portfolio according to the credit risk characteristics, and calculates the expected credit
loss on collective basis. The basis for determining the portfolio is as following:
Name Approach of assessing expected credit risk
Bank acceptance For notes receivables divided into portfolio, the bank acceptance bill and
bill Portfolio; commercial acceptance bill refer to the historical credit loss experience, and
Commercial combines the current situation and the forecast of future economic situation
acceptance bill respectively.The Company calculates the expected credit loss based on the
Portfolio default risk exposure and the expected credit loss rate of the whole duration.
For accounts receivables divided into risk portfolio, the Company refers to the
Risk Portfolio historical credit loss experience, and combines the current situation and the
forecast of future economic situation, and prepares a comparison table between
overdue ages of accounts receivables and expected credit loss rate of the whole
duration to calculate the expected credit loss.
The Company classifies items without significant recovery risk receivables as
Other Portfolio
other portfolio such as items from subsidiaries in the consolidation scope, tax
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refunds receivable, collection and withholding of funds. There is no provision for
bad debt for them.
The Company shall take the provision or transfer the loss into the current profit and loss.
For the debt instrument investment measured at fair value through other comprehensive
income, the Company shall adjust other comprehensive income while recording the
impairment loss or gain into the current profit and loss.
11. Inventory
(1) Classification of inventory
Inventories are classified as: raw materials, semi-finished goods, stock commodities,
consigned processing materials, goods in progress and revolving materials (including
low-cost consumables), etc.
Measurement method of dispatched inventories
Dispatched materials and stock commodities are accounted for by using the weighted
average method.
(2) Basis to determine net realizable values of inventories and method of provision for
stock obsolescence
a)Determination basis of net realizable values of inventories
i. In normal operation process, for merchandise inventories held directly for sale,
including stock commodities (finished goods) and materials for sale, their net realizable
values are determined at their estimated selling prices minus their estimated selling
expenses and relevant taxes and surcharges.
ii. In normal operation process, for material inventories that need further processing, their
net realizable values are determined at the estimated selling prices of finished goods
minus estimated costs to completion, estimated selling expenses and relevant taxes and
surcharges.
iii. For inventories held to execute sales contract or service contract, their net realizable
values are calculated on the basis of contract price. If the quantities of inventories
specified in the sales contracts are less than the quantities held by the Company, the net
realizable value of the excess portion of inventories shall be based on general selling
prices.
iv. The materials held for production shall be measured at cost if the net realizable value
of the finished products is higher than the cost. If a decline in the value of materials
shows that the net realizable value of the finished products is lower than the cost, the
materials shall be measured at the net realizable value.
b)Provision for stock obsolescence
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i.Provisions for stock obsolescence are made at the lower of costs or net realizable
values on a single basis.
ii.For inventories with large quantity and relatively low unit prices, the provision for stock
obsolescence shall be made on the ground of the categories of inventories.
(3) Inventory system
The Company adopts perpetual inventory system and takes physical inventory counts on
a regular basis.
(4) Amortization method of revolving materials
A.Amortization method of low-cost consumables:
Low-cost consumables are amortized in full at once.
B.Amortization method of packaging materials
Packing materials are amortized in full at once when fetched for use by the Company.
12. Assets held for sale
(1) Scope of held for sale
Held for sale include individual asset and disposal group.
Disposal group is a group of assets that are disposed as a whole through sales or other
ways in one transaction and liabilities directly related to these assets delivered in the
transaction.
(2) Recognition criteria of held for sale
The Company recognizes its component (or non-current asset) that satisfies the following
conditions as assets held for sale:
a)The assets (or disposal group) must be available for immediate sale in its present
condition subject only to terms that are usual and customary for sales of such assets (or
disposal groups);
b) Its sale must be highly probable. The Company has already made a decision to
dispose the component and has a commitment from the purchaser, the transfer will be
completed within one year. If it requires shareholders’ approval or supervisors’ approval
according to regulations, it has already received approval from the general meeting of
stockholders or relative authority institution.
(3) Accounting treatment and. presentation of assets held-for-sale
a) The non-current asset (or disposal group) is first classified as held for sale, the
Company should measure the non-current assets or assets and liabilities made up of
disposal group in accordance with relevant accounting standards.
b) When the Company measure a non-current asset (or disposal group) held for sale
initially or re-measure at balance sheet date subsequently, the impairment loss should be
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recognized if the book value is higher than fair value less costs to sell at the amount of
the difference of these two in profit and loss, the provision for assets held for sale need to
be recognized at the same time. For the impairment of disposal group, should write off
goodwill if existing, and then write down the related assets proportionally. Depreciation or
amortization should cease for the non-current asset held for sale.
c) No matter the asset is classified as individual asset held for sale or asset belonging to
disposal group, the asset is presented as current assets under “assets held for sale” item;
liabilities related to the asset transferred in the disposal group held for sale is presented
as current liabilities under “liabilities held for sale” item in the balance sheet.
d) The Company is committed to a sale plan involving loss of control of subsidiary shall
classify all the assets and liabilities of that subsidiary held for sale in consolidated
balance sheets when the above criteria are met, regardless of whether the Company
retain a non–controlling interests in its former subsidiary after the sale. In the balance
sheets of parent company the investment should be classified as held for sale in full.
(4) Discontinued operations
A discontinued operation is a component of an entity that either has been disposed of or
is classified as held for sale, and meets one of the follow conditions:
a)It represents either a separate major line of business or a geographical area of
operations;
b)It is part of a single co-ordinated plan to dispose of a separate major line of business or
geographical area of operations; or
c)It is a subsidiary acquired exclusively with aim to resale.
13. Long-term equity investment
(1) Recognition of the initial investment costs of long-term equity investments
a)For long-term equity investments from business combinations, the initial investment
cost shall be recognized in accordance with the provisions mentioned in Note 3.5,
Accounting Method for Long-term Equity Investment from Business Combinations under
Common Control and Business Combination not under Common Control.
b) Except for the long-term equity investments arising from business combinations, those
obtained by other means shall recognize their initial investment costs in accordance with
the following provisions:
i.For the long-term equity investments obtained by cash paid, the Company recognizes
the actual purchase price as the initial investment costs. The initial investment costs
include directly related expense, taxes and other necessary expenses of obtaining long-
term equity investments.
ii.For the long-term equity investments acquired by the issue of equity securities (equity
instrument), the initial investment cost shall be the fair value of the equity securities
(equity instrument) issued. If the fair value of the long-term equity investment obtained is
more reliable than equity securities issued, the initial investment cost shall be the fair
value of the long-term equity investment made by the investors. The cost directly
attributable to the issue of equity securities (equity instrument), including fees,
commissions, etc., write-downs premium price of the issue, if premium price of the issue
is insufficient, write-downs surplus reserve and undistributed profit in turn. For the long-
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term equity investments acquired by the issue of debt securities (debt instrument) ,
reference through the issuance of equity securities (equity instrument).
iii. For long-term equity investments obtained by debt restructuring, the Company
recognizes the fair value of shares of debt-for-equity swap as the initial investment costs.
iv.For long-term equity investments obtained by non-monetary assets exchange, under
the condition that an exchange of non-monetary assets is of commerce nature and the
fair value of assets exchanged can be reliably measured, non-monetary assets traded in
is initially stated at the fair value of the assets traded out, unless there is conclusive
evidence indicating that the fair value of the assets traded in is more reliable; if the above
conditions are not satisfied, initial investment costs of long-term equity investments
traded in shall be recognized at the book value of the assets traded out and the relevant
taxes and surcharges payable.
Expenses, taxes and other necessary expenses incurred to the Company and that are
directly related to the obtainment of long-term equity investments shall be recognized as
the initial investment costs of long-term equity investments.
For long-term equity investments obtained by the Company by any means, cash
dividends or profits declared but not yet distributed in the actual payments or the
consideration actually paid for the investment shall be separately accounted as dividends
receivable and shall not constitute the costs of long-term equity investments.
(2) Subsequent measurement and recognition of gains and losses of long-term equity
investments
a) If the Company can control an investee, namely investment in subsidiary, the long-
term equity investment shall be measured under the cost method.
For long-term equity investments accounted at the cost method, except cash dividends or
profits declared but not yet distributed which are included in the actual payments or the
consideration actually paid for the investment, the cash dividends or profits declared by
the investee shall be recognized as the investment income irrespective of net profits
realized by the investee before investment or after investment.
b) Long-term equity investments measured under the equity method
i. For the long-term equity investment which has joint control or significant influence over
the investee, the equity method is adopted for accounting.
ii.For long-term equity investments measured at the equity method, if the initial
investment costs are higher than the investor’s attributable share of the fair value of the
investee’s identifiable net assets, no adjustment will be made to the initial costs of the
long-term equity investments; if the initial investment costs are lower than the investor’s
attributable share of the fair value of the investee’s identifiable net assets, the difference
shall be recognized in current profit and loss and at the same time the adjustment will be
made to the initial costs of the long-term equity investments.
iii.After obtaining the long-term equity investments, the Company shall, according to the
shares of net profits and other comprehensive income realized by the investee that shall
be enjoyed or borne by the Company, recognize the profit and loss on the investments
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and adjust the book value of the long-term equity investments. When recognizing the net
profits and losses and other comprehensive income of the investee that the Company
shall enjoy or bear, the Company shall make a recognition and calculation based on the
net book profits and losses of the investee after appropriate adjustments. However,
where the Company is unable to obtain the relevant information due to failure to
reasonably determine the fair value of the investee’s identifiable assets, minor difference
between the investee’s identifiable assets and the book value thereof or other reasons,
the profits or losses on the investments shall be directly calculated and recognized based
on the net book profits and losses of the investee. The Company shall calculate the part
distributed from cash dividends or profits declared by the investee and correspondingly
reduce the book value of the long-term equity investments.
When recognizing the income from investments in associates and joint ventures, the
Company shall write off the part of incomes from internal unrealized transactions
between the Company and associates and joint ventures which are attributable to the
Company and recognize the profit and loss on investments on such basis. Where the
losses on internal transactions between the Company and the investee fall into the scope
of losses on assets impairment, full amounts of such losses shall be recognized. Profit
and loss from internal unrealized transactions between the Company’s subsidiaries
included into the combination scope and associates and joint ventures shall be written off
according to the above principles and the profit and loss on investments thereafter shall
be recognized on such basis.
When the share of net loss of the investee attributable to the Company is recognized, it is
treated in the following sequence: Firstly, write off the book value of the long-term equity
investments; where the book value of the long-term equity investments is insufficient to
cover the loss, investment losses are recognized to the extent that book value of long-
term equity which form net investment in the investee in other substances and the book
value of long-term receivables shall be written off; after all the above treatments, if the
Company still assumes additional obligation according to investment contracts or
agreements, the obligation expected to be assumed should be recognized as provision
and included into the investment loss in the current period. If the investee is profitable in
subsequent accounting periods, the Company shall treat the loss in reverse order against
that described above after deducting unrecognized share of loss: i.e. write down the book
value of the recognized provision, then restore the book value of long-term interests
which substantially form net investments in the investee, then restore the book value of
long-term investments, and recognize investment income at the same time.
(3) Basis for judgment of common control or significant influence over the investee
a).Basis for judgment of common control over investee
Common control is the contractually agreed sharing of control of an arrangement, which
exists only when decisions about the relevant activities require the unanimous consent of
the parties sharing control. Relevant activities of an arrangement usually include selling
and purchasing of goods or services, managing financial assets, acquiring or disposing of
assets, researching and developing activities and financing activities. A joint venture is a
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joint arrangement whereby the joint ventures have rights to the net assets of the
arrangement. The parties have rights to the assets, and obligations for the liabilities,
relating to the arrangement, which is a joint operation, but not a joint venture.
b).Basis for judgment of significant influence over investee
The term “significant influence” refers to the power to participate in decision-making
on the financial and operating policies of the investee, but with no control or joint control
over the formulation of these policies. Where the Company is able to exert significant
influence over the investee, the investee is its associate.
14. Fixed assets
(1) Recognition of fixed assets
Fixed assets refer to tangible assets held for the purpose of producing commodities,
providing services, renting or business management with useful life exceeding one
accounting year. Fixed assets are recognized when the following criteria are satisfied
simultaneously:
a) It is probable that the economic benefits relating to the fixed assets will flow into the
Company;
b) The cost of the fixed assets can be measured reliably.
(2) Depreciation of fixed assets
Estimated Estimated
Annual depreciation
Category Depreciation method useful life residual value
rate (%)
(Yr) rate (%)
Buildings and
Straight-line method 20～25 5 3.80～4.75
constructions
Machinery equipments Straight-line method 10 5 9.50
Transportation
Straight-line method 10 5 9.50
equipments
Other equipments Straight-line method 8 5 11.88
Except for the fixed assets that have been fully depreciated but are still in use and the
land, the Company makes provisions for depreciation of all fixed assets.
b) Depreciation of fixed assets of the Company is provided for on a straight-line basis
from the month immediately following the month when they reach the working condition
for their intended use. The depreciation amount and depreciation rate shall be calculated
and recognized according to the category, estimated useful lives and estimated net
residual value rate of fixed assets and respectively included into the costs of the relevant
assets or the current profit and loss by purpose.
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c) When making provision for impairment on fixed assets, the Company shall recalculate
the depreciation rate and depreciation amount according to the book value, the estimated
net residual value rate and useful lives of the fixed assets.
d) On the balance sheet date, the Company reviews the estimated useful life, estimated
net residual value rate and depreciation method of the fixed assets. If there is any
change, they shall be treated as changes in accounting estimate.
e) Decoration expense of fixed assets that meet the condition of capitalization shall be
depreciated separately by adopting straight-line method within the short period between
twice decoration and useful life of the fixed assets.
(3) Recognition standard, valuation method and depreciation method for fixed assets
acquired under financing lease
a) At the inception of the lease, the Company recognizes the leased fixed assets meeting
the standards for financial leases as fixed assets acquired under financing leases.
b)At the inception of the lease, the Company shall state the assets acquired under
financing lease at the lower of the fair value of the leased assets or the present value of
the minimum lease payments, as well as the initial and direct expenses occurred,
recognize a long-term payable at the amount of the minimum lease payments, and shall
charge the difference of the lower of the fair value of the leased assets or the present
value of the minimum lease payments and the minimum lease payments to unrecognized
finance expenses. Unrecognized finance expenses shall be amortized at the effective
interest rate method in each period during the lease term.
c)Adapt the same depreciation method as the one used on other fixed assets owned by
the company. If there is reasonable assurance that the Company will obtain the
ownership of the leased assets when the lease term expires, the leased assets should be
depreciated over its useful life; if there is no reasonable assurance that the Company will
obtain the ownership of the leased assets when the lease term expires, the leased assets
should be depreciated over the shorter of the lease term or the useful life of the leased
assets.
15. Construction in progress
(1) Categories of constructions in progress
Constructions in progress are accounted on individual project basis.
(2) Criteria and commencement of conversion of constructions in progress into fixed
assets
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The book entry values of the fixed assets are stated at total expenditures incurred before
construction in progress reaches the working condition for their intended use. For self-
operating projects, total expenditures are measured according to the expenditures of
direct materials, direct labor, direct measurement mechanical construction costs and
other expenditures; for contracting projects, total expenditures are measured according
to project costs payable and other expenditures. Borrowing costs incurred before the
projects that are undertaking with borrowing costs reach working condition for their
intended use and meeting the condition for capitalization shall be capitalized and
included into the costs of construction in progress.
For construction in progress that has reached working condition for intended use but for
which the completion of settlement has not been handled, it shall be transferred into fixed
assets at the estimated value according to the project budget, construction price or actual
cost, etc. from the date when it reaches the working condition for intended use and the
fixed assets shall be depreciated in accordance with the Company’s policy on fixed asset
depreciation; adjustment shall be made to the estimated value based on the actual cost
after the completion of settlement is handled, but depreciation already provided will not
be adjusted.
16. Borrowing costs
(1) Scope of borrowing costs
The Company’s borrowing costs include interest thereon, amortization of discounts or
premiums, ancillary expenses and exchange differences incurred from foreign currency
loan, etc.
(2) Recognition principles of capitalization of borrowing costs
The borrowing costs incurred to the Company and directly attributable to the acquisition
and construction or production of assets eligible for capitalization should be capitalized
and recorded into relevant asset costs; other borrowing costs should be recognized as
costs according to the amount incurred and be included into the current profit and loss.
Assets eligible for capitalization include fixed assets, investment properties, inventories
and other assets which may reach the working condition for their intended use or sale by
acquisition and construction or production activities for quite long time.
(3) Recognition of capitalization period of borrowing costs
a) Recognition of commencement of capitalization of borrowing costs
Borrowing costs may be capitalized when asset disbursements have already been
incurred, borrowing costs have already been incurred and the acquisition and
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construction or production activities which are necessary to prepare the assets for their
intended use or sale have already been started. Among which, asset disbursements
include those incurred by cash payment, the transfer of non-cash assets or the
undertaking of interest-bearing debts for acquiring and constructing or producing assets
eligible for capitalization.
b) Recognition of period of capitalization suspension of borrowing costs
If the acquisition and construction or production activities of assets eligible for
capitalization are interrupted abnormally and this condition lasts for more than three
months, the capitalization of borrowing costs should be suspended. The borrowing costs
incurred during interruption are charged to profit or loss for the current period, and the
capitalization of borrowing costs continues when the acquisition and construction or
production activities of the asset resume. If the interruption is necessary for the
acquisition and construction or production to prepare the assets for their intended use or
sale, the capitalization of borrowing costs should continue.
c) Recognition of period of capitalization cessation of borrowing costs
Capitalization of borrowing costs should cease when the acquired and constructed or
produced assets eligible for capitalization have reached the working condition for their
intended use or sale. Borrowing costs incurred after the assets eligible for capitalization
have reached the working condition for their intended use or sale should be recognized
as the current profit and loss when they incur.
If all parts of the acquired and constructed or produced assets are completed, each part
may be used or sold externally in the process of continuous construction of other parts
and the necessary acquisition or production activities have been substantially completed
to make the part of assets reach the working condition for their intended use or sale, the
capitalization of borrowing costs related to the part of assets should be ceased; if all parts
of the acquired and constructed or produced assets are completed but the assets cannot
be used or sold externally until overall completion, the capitalization of borrowing costs
should cease at the time of overall completion of the said assets.
(4) Recognition of capitalized amounts of borrowing costs
a) Recognition of capitalized amounts of interest on borrowing costs
During the period of capitalization, capitalized amount of the interest of each accounting
period (including amortization of discounts or premiums) shall be recognized according to
the following provisions:
i.As for special loan borrowed for acquiring and constructing or producing assets eligible
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for capitalization, borrowing costs of special loan actually incurred in the current period
less the interest income of the loans unused and deposited in bank or return on
temporary investment should be recognized as the capitalization amount of borrowing
costs.
ii.As for general loans used for acquiring and constructing or producing assets eligible for
capitalization, the interest of general loans to be capitalized should be calculated by
multiplying the weighted average of asset disbursements of the part of accumulated
asset disbursements in excess of special loans by the capitalization rate of used general
loans. The capitalization rate is calculated by weighted average interest rate of general
loans.
iii. Where there are discounts or premiums on loans, the amounts of interest for each
accounting period should be adjusted taking account of amortizable discount or premium
amounts for the period by effective interest method.
iv.During the period of capitalization, the capitalized amount of interest of each
accounting period shall not exceed the current actual interest of the relevant loans.
b) Recognition of capitalized amounts of auxiliary expenses of loans
i.Auxiliary expenses incurred from special loans before the acquired or constructed
assets eligible for capitalization reach the working condition for their intended use or sale
should be capitalized when they incur and charged to the costs of assets eligible for
capitalization; those incurred after the acquired or constructed assets eligible for
capitalization reach the working condition for their intended use or sale should be
recognized as costs according to the amounts incurred when they incur and charged to
the current profit or loss.
ii. Auxiliary expenses incurred from general loans shall be recognized as costs according
to the amounts incurred when they occur and included in the current profit and loss.
c) Recognition of capitalized amount of exchange differences
During the period of capitalization, exchange differences incurred from the principal and
interest of special foreign currency loans should be capitalized and included in the costs
of the assets eligible for capitalization.
17. Intangible assets
(1) Measurement, useful life and impairment test
Initial measurement of intangible assets
Initial measurement of outsourcing intangible assets
Costs of outsourcing intangible assets shall be recognized according to the purchase
price, related taxes and other expenses directly attributed to reaching the working
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condition for their intended use. The cost of intangible assets shall be recognized based
on present value of purchase price when deferred payment over normal credit conditions
with financial nature. The difference between actual payment and purchase price, expect
for capitalized amount, shall be included into the current profit and loss in the period of
credit.
Initial measurement of internally researched and developed intangible assets
Costs of internally researched and developed intangible assets shall be recognized
according to the total expenses during the period after the assets are eligible for
capitalization and before they reach the intended purpose and the expenses that have
been included in the previous periods shall no longer be adjusted.
Expenses on the research phase of internally researched and developed intangible
assets shall be included in the current profit and loss when they incur; those on the
development phase ineligible for capitalization shall be included in the current profit and
loss; those eligible for capitalization shall be recognized as intangible assets. If it is
unable to distinguish expenditure on the research phase and expenditure on
development phase, the research and development expenditures shall be all included in
the current profit and loss.
Subsequent measurement of intangible assets
The useful lives of intangible assets are analyzed on acquisition. Intangible assets
obtained by the Company are divided into intangible assets with limited useful lives and
intangible assets with indefinite useful lives.
Subsequent measurement of intangible assets with limited useful lives
The intangible assets with limited useful lives are amortized on a straight-line basis when
they reach intended use over their useful lives with no residual value reserved.
Amortizations of intangible assets are usually recorded into the current profit and loss;
where the economic benefits of an intangible asset are realized by the products or other
assets produced thereafter, the amortizations are recorded into the costs of the relevant
assets.
Category, estimated useful life, estimated net residual value rate and annual amortization
rate of intangible assets are shown below:
Category of intangible Estimated net residual Annual amortization
Estimated useful life (years)
assets value rate (%) rate (%)
Land use right 50 0 2.00
Trademark 7-10 0 14.29-10.00
Computer software 10 0 10.00
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The useful lives and amortization methods of intangible assets with limited useful lives on
the balance sheet date shall be reviewed.
Subsequent measurement of intangible assets with indefinite useful lives
Intangible assets with indefinite useful lives are not amortized in the holding period, but
impairment tests are performed at the end of each year.
Estimates of useful lives of intangible assets
a) For intangible assets from any contractual right or other statutory rights, their useful
lives shall be recognized according to the period no more than that of the contractual or
other statutory rights; when the contractual right or other statutory rights contract is
extended due to renewal of contracts and there is evidence that the renewal of the
Company does not need large costs, the renewal period shall be included into the useful
lives.
b) Where the contract or the law fails to specify the useful lives, the Company integrates
situations in all aspects and determine the period of intangible assets that can bring
economic benefits for the Company by hiring the relevant experts to demonstrate or
comparing with the situation of the industry as well as referring to the Company’s
historical experience or otherwise.
c) If it is still unable to reasonably determine that intangible assets may bring economic
benefits for the Company according to the above methods, the intangible assets are
taken as intangible assets with indefinite useful lives.
(2) Accounting policies of internal research and development expenditure
According to the actual situation of the research and development, the Company
classifies the research and development project into that on the research phase and that
on the development phase.
a) Research stage
Research stage is the stage when creative and planned investigations and research
activities are conducted to acquire and understand new scientific or technological
knowledge.
b) Development stage
Development stage is the stage when the research achievements or other knowledge are
applied to a plan or design, prior to the commercial production or use, so as to produce
any new or substantially improved material, device or product.
Expenditure of an internal research and development project on the research phase shall
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be included in current profit and loss when it occurs.
Specific criteria for qualifying expenditure on the development phase for capitalization
Expenditure on the development phase of an internal research and development project
shall be recognized as intangible assets only when the following conditions are
simultaneously satisfied:
a) It is technically feasible to finish intangible assets for use or sale;
b) It is intended to finish and use or sell the intangible assets;
c)The usefulness of intangible assets to generate economic benefits shall be proved,
including being able to prove that there is a potential market for the products
manufactured by applying the intangible assets or there is a potential market for the
intangible assets themselves or the intangible assets will be used internally;
d) It is able to finish the development of the intangible assets, and able to use or sell the
intangible assets, with the support of sufficient technologies, financial resources and
other resources;
e) The expenditure attributable to the intangible asset during its development phase can
be measured reliably.
18. Non-current assets impairment
If there are impairment indicators of long-term equity investment, investment property
measured at cost model, fixed assets, construction in progress, intangible assets with
indefinite useful lives and other long-term assets at balance sheet date, impairment test
should be performed. If the result of impairment test shows that recoverable amount is
less than its book value, the difference should be provided for impairment and recorded
into impairment loss. The recoverable amount is the higher of fair values less costs of
disposal and the present values of the future cash flows expected to be derived from the
asset. Provision for impairment is calculated and recognized on the basis of individual
asset. If recoverable amount of individual asset is difficult to be estimated, the Company
should recognize the recoverable amount of the asset group which the individual asset
belongs to. Asset group is the minimum asset group which can generate cash inflow
separately.
The Company should perform impairment test for goodwill and intangible assets with
indefinite life at least at each year end, no matter whether there is impairment indicator.
When the Company performs impairment test, book value of goodwill arising from
business combination should be amortized to relevant asset group using the reasonable
method from the date of purchase. If it is difficult to amortize it to relevant asset group,
amortize it to relevant asset group portfolio. Apportion book value of goodwill to relevant
asset group or asset group portfolio according to the proportion of fair value of asset
group or asset group portfolio accounting for total amount of relevant asset group or
asset group portfolio. If fair value is difficult to be measured reliably, amortize according
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to the proportion of book value of asset group or asset group portfolio accounting for total
amount of relevant asset group or asset group portfolio. When perform impairment test
for asset group or asset group portfolio including goodwill, if there is impairment indicator
of asset group or asset group portfolio relevant to goodwill, perform impairment test for
asset group or asset group portfolio without goodwill firstly, calculate its recoverable
amount, compare with relevant book value and recognize impairment loss. Then perform
impairment test for asset group or asset group portfolio including goodwill, compare book
value of the asset group or asset group portfolio (including proportional book value of
goodwill) and its recoverable amount, if recoverable amount of relevant asset group or
asset group portfolio is less than its book value, recognize impairment loss of goodwill.
Once impairment loss stated above is recognized, reversal is not allowed in the
subsequent accounting periods.
19. Long-term deferred expenses
(1) Scope of long-term deferred expenses
Long-term deferred expenses refer to various expenses which have been already
incurred but will be born in this period and in the future with an amortization period of
over 1 year (exclusive).
(2) Initial measurement of long-term deferred expenses
Long-term deferred expenses shall be initially measured according to the actual costs
incurred.
(3) Amortization of long-term deferred expenses
Long-term deferred expenses are amortized using the straight-line method over the
beneficial period.
20. Employee benefits
(1) Accounting treatment of short-term benefits
Short-term benefits are the benefits that the Company expect to pay in full within 12
months after the reporting period in which the employee provided relevant services,
excluding the compensation for employment termination.
Short-term benefits include: wage, bonus, allowance and subsidy; employee welfare,
social securities including health insurance and work injury insurance; housing common
reserve fund; union expenditure and employee training expenditure; short-term paid
leave; short-term profit-sharing; non-monetary welfare and other short-term benefits.
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Actual short term benefits will be recognized as liability during the accounting period in
which the employee is providing the relevant service to the Company. The liability will be
included in the current profits and losses or the cost relevant assets.
(2) Accounting treatment of post-employment benefits
The defined contribution plan of the Company include payments of basic pension,
unemployment insurance, annuity, etc. that accord to relevant provisions. The amount
which the Company deposit on balance sheet date in exchange for the service of the
employee during the accounting period will be recognized as employee benefits liability
and shall be included into the profit or loss for the current period.
(3) Accounting treatment of termination benefits
Termination benefits are the benefits the Company provide to the employee when the
Company terminates the employment before labor contract expires or encourages
voluntary resignation. Employee benefits liabilities shall be recognized and included into
profit or loss for the current period on the earlier date of the two following circumstances:
A.When the Company is not able to withdraw the benefits from termination of
employment or resignation persuasion unilaterally;
B.When the Company recognizes costs and fees relevant to reforming the termination
benefits payment.
(4) Accounting treatment of other long-term employee benefits
Other long-term employee benefits are all employee benefits other than short-term
benefits, post-employment benefits and termination benefits. At the end of reporting
period, the company will recognize the employee benefits cost from other long-term
employee benefits as the following components:
a)Service cost;
b) Net amount of interest from other long-term employee benefits net liabilities or assets;
c) Changes from recalculation of the net liabilities or assets from other long-term
employee benefits.
In order to simplify related accounting procedure, the net amount of the above subjects
shall be included into current profit or loss or the cost of relevant assets.
21. Provisions
(1) Recognition principles of provision
When obligations related to external guarantees, pending actions or arbitration, product
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quality assurance, onerous contracts, reorganization and contingencies satisfy the
following three conditions, they shall be recognized as provision:
a)This obligation is a present obligation of the Company;
b)The settlement of such obligation is likely to result in outflow of economic benefits from
the Company; and
c) The amount of the obligation can be measured reliably.
(2) Measurement method of provision
The amount of provision is measured at the best estimate of expenses required for
contingencies.
a) If there is continuous range for the necessary expenses, and probabilities of
occurrence of all the outcomes within this range are equal, the best estimate shall be
determined at the median of the range.
b) The best estimate shall be accounted as follows in other cases:
i.If the contingency involves a single item, the best estimate shall be determined at the
most likely outcome.
ii.If the contingency involves two or more items, the best estimate should be determined
according to all the possible outcomes with their relevant probabilities.
22. Revenue
Whether the new revenue standard has been implemented
□ Yes √ No
Operating revenue of the Company mainly includes revenue from sales of goods,
revenue from rendering of service and revenue from transfer of asset use right, for which
the recognition principles are as follows:
(1) Recognition principals of revenue from sales of goods
Revenue from sales of goods is recognized when the Company has transferred
significant risks and rewards of ownership of the goods to the purchaser; the Company
retains neither continuing managerial involvement usually related to the ownership nor
effective control over the sold goods; revenues can be measured reliably; the relevant
economic benefits are highly likely to flow into the Company; and the relevant costs
incurred or to be incurred can be measured reliably.
The Company’s specific condition of revenue recognition is that revenue is recognized
after customer acceptance based on receiving payment or obtaining the rights of claiming
payment for goods according to signed sales contracts or agreements.
The Company offers a certain percentage discount to dealers according to marketing
policies and sales status of dealers of liquor products. The settlement with dealers is
made regularly or irregularly. The sales revenue is recognized based on (net) invoice
amount after discount when the discount is included to invoice. According to accrual
basis principle , the discount incurred but not yet settled shall be recognized in sales
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revenue and included to other payables.
(2) Recognition principals of revenue from rendering of service
Recognition principals of revenue from rendering of service under the circumstance that
the outcome of service transactions can be estimated reliably
The Company recognizes revenue from rendering of service using the percentage-of-
completion method on the balance sheet date when the outcome of service transactions
can be estimated reliably.
When the amount of revenues can be measured reliably, related economic interests are
likely to flow into the company, schedule of completion of the transitions can be
measured reliably and the cost of transactions incurred or to be incurred can be
measured reliably, the outcome of service transactions can be estimated reliably.
Recognition principals of revenue from rendering of service under the circumstance that
the outcome of service transactions cannot be estimated reliably
If the outcome of rendering of services on the balance sheet date cannot be measured
reliably, the revenues from rendering of services shall be recognized according to the
following three conditions:
a)If the labor costs that have already incurred can be fully compensated, the revenues
from rendering of services are recognized at the amounts recovered or expected to be
recovered and the labor costs that have already incurred shall be carried forward;
b) If the labor costs that have already incurred can be partially compensated, the
revenues from rendering of services are recognized at the recoverable amounts of
compensated labor costs and the labor costs that have already incurred shall be carried
forward;
c) If it is expected that all the labor costs that have already incurred cannot be
compensated, the labor costs that have already incurred are included into the current
profit and loss (costs of primary business) and the revenues from rendering of services
are not recognized.
(3) Recognition principals of revenue from transfer of asset use right
When economic benefits related to transactions are highly likely to flow into the Company
and the amount of revenue can be reliably measured, the revenue from transfer of asset
use right is recognized.
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23. Government grants
(1) Types of government grants
Government grants are monetary assets and non-monetary assets acquired free of
charge by the Company from the government, including government grants related to
assets and government grants related to income.
Government grants related to assets are government grants that are acquired by the
Company and used for forming long-term assets through purchasing and constructing or
other ways.
Government grants related to income are government grants other than government
grants related to assets.
(2) Recognition principles of government grants
Government grants are recognized when both of the following conditions are met:
a) The Company can meet the attached conditions for the government grants;
b) The Company can receive the grants.
(3) Measurement of government grants
a) If a government grant is a monetary asset, it shall be measured in the light of the
received or receivable amount.
b) If a government grant is a non-monetary asset, it shall be measured at its fair value;
and if its fair value cannot be obtained in a reliable way, it shall be measured at a nominal
amount (a nominal amount is CNY 1).
(4) Accounting treatment method of government grants
a) The government grants related to assets shall be set off of the book value of the
related assets or recognized as deferred income at the actual entry amount on
acquisition. Government grants recognized as deferred income shall be allocated evenly
over the useful lives of the relevant assets, and included in the current profit or loss.
Government grants measured at the nominal amount shall be directly included in current
profit and loss.
b) Government grants related to income shall be separately handled according to the
following circumstances:
i.If government grants related to income are used to compensate the Company’s relevant
expenses or losses in future periods, such government grants should be recognized as
deferred income on acquisition and be included into the current profit and loss or written
off of the related costs when the relevant expenses, losses are recognized.
ii.If government grants related to income are used to compensate the Company’s
relevant expenses or losses incurred, such government grants are directly included into
the current profit and loss on acquisition or written off of the related costs.
b) Government grants related to assets and related to income are received together,
shall be treated separately. If it is hard to separate, government grants shall be treated as
related to income as a whole.
c) Government grants related to daily operation shall be recoded in other income or
written off relevant expenses, costs. Government grants unrelated to daily operation shall
be recorded in non-operating income. Financial subsidy funds directly allocated to the
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company shall be offset the relevant borrowing costs.
d) Government grants already recognized required to be refunded shall be handled
according to the following circumstances:
i. If the grants have written down the book value of assets, the book value shall be
adjusted.
ii. If there is related deferred income, the book value of relevant deferred income is
written down and the exceeding part is recorded in the current profit and loss.
iii. If there is no related deferred income, the exceeding part is directly included in the
current profit and loss.
24. Deferred tax assets and deferred tax liabilities
The Company adopts the balance sheet liability method to account for income tax.
(1) Recognition of deferred tax assets or deferred tax liabilities
a) The Company recognizes its tax base on acquisition of assets and liabilities. On the
balance sheet date, the Company analyzes and compares the book value of the assets
and liabilities and the tax base. If there are temporary differences in book value of the
assets and liabilities and the tax base, under the circumstance that the temporary
differences incur in the current period and meet the recognition criteria, the Company
shall respectively recognize taxable temporary differences or deductible temporary
differences as deferred tax liability or deferred tax assets.
b) Recognition basis of deferred tax assets
i. Deferred tax assets incurred from deductible temporary differences are recognized to
the extent that they shall not exceed the taxable income probably obtained in future
periods to be against the deductible temporary difference. In determining the taxable
income probably obtained in future periods, including the taxable income from normal
production and operation activities in future periods and the increase of taxable income
due to the reversal of taxable temporary differences during the period of reversal of
deductible temporary differences.
ii.For deductible losses and tax credits that can be carried forward to the next years, the
Company is likely to recognize the corresponding deferred tax assets to the extent that
the assets shall not exceed the taxable income in the future for deducting deductible
losses and tax credits and that are probably obtained by the Company.
iii. On the balance sheet date, the Company reviews the book value of deferred tax
assets. If it is probably unable to obtain sufficient taxable income in the future period to
offset the benefits of the deferred tax assets, the Company shall write down the book
value of the deferred tax assets; when it is probable to obtain sufficient taxable income,
the write-downs shall be reversed.
c) Recognition basis of deferred tax liabilities
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The Company recognizes the current and previous taxable temporary differences
payable but unpaid as deferred tax liabilities. But they exclude temporary differences
arising from goodwill; transactions which are formed other than from business
combinations and neither affect the accounting profits nor affect taxable income at the
time of occurrence.
(2) Measurement of deferred tax assets or deferred tax liabilities
a) On the balance sheet date, the deferred tax assets and deferred tax liabilities are
measured at the applicable tax rate during the period of expected recovery of the assets
or liquidation of the liabilities in accordance with the provisions of the tax law.
b) Where the applicable tax rate changes, the Company remeasures deferred tax assets
and deferred tax liabilities recognized, except for those incurred in transactions or events
directly recognized in the owner’s equity, of which the effect shall be included in the
income tax expenses in the current period when the rate changes.
c) When the Company measures the deferred tax assets and deferred tax liabilities, the
tax rate and tax base in consistent with the expected recovery of assets or liquidation of
liabilities shall be adopted.
d) Deferred tax assets and deferred tax liabilities of the Company shall not be discounted.
25. Lease
(1) Accounting treatment method of operating lease
Lessee records rents of operating lease into cost of related assets or current profit or loss
using straight line method in each period of the lease term. Initial direct expenses
incurred are recorded into current profit or loss. Contingent rents are recorded into
current profit or loss when occur.
Lessor includes assets used for operating lease in the related items of financial
statements. Rent of operating lease is recognized into current profit or loss using straight
line method in the various period of the lease term. Initial direct expenses are recorded
into current profit or loss. Depreciate fixed asset in the operating lease using depreciation
policy of the similar assets. Amortize other operating lease assets using systematic
reasonable method. Contingent rent is recorded into current profit or loss when occur.
(2) Accounting treatment method of financing lease
As the lessee, recognize the lower of fair value of lease asset and minimum lease
payment at the beginning day of the lease as the initial value of the asset leased in and
the minimum lease payment as long-term payable, the difference as unrealized finance
expense. Bank charges, lawyer fee, travel allowances, stamp taxes and other initial direct
expenses that can be attributable to lease project in the lease negotiation and signing the
lease contract are recorded into the asset leased in. Unrealized finance expense is
amortized in the period during the lease term and recognized as current finance
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
expenses using actual effective rate method. Contingent rent is recorded into current
profit or loss when actually occur.
As the lessor, recognize the total of minimum lease amount received and initial direct
expenses as the initial value of finance lease amount receivable and record the residual
amount not guaranteed at the same time. Recognize the difference between the total of
minimum lease amount received, initial direct expenses and residual amount not
guaranteed and present value of that as unrealized finance income. Amortize unrealized
finance income in the period during the lease term and use effective interest rate to
recognize current finance income. Contingent rent is recorded into current profit or loss
when actually occur.
26. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
√ Applicable N/A
Content and reason of changes in Procedure for examination
Notes
accounting policies and approval
The Company shall, from January 1,
2019, implement the accounting
According to the requirements
standard for business enterprises No.22-
of the new financial instrument
Financial instrument recognition and
standards, the relevant
measurement, accounting standard for Reviewed and approved by
information of financial
business enterprises No.23-Financial the sixth meeting of the sixth
instruments shall be presented
asset transfer, accounting standard for board of directors.
and the comparative financial
business enterprises No.24-Hedge
statements shall not be
accounting, and accounting standard for
retroactively adjusted.
business enterprises No.37-Presentation
of financial instruments revised by
Ministry of Finance in 2017.
Items Balance as at 31 Balance as at 1 Adjustment
December 2018 January 2019
Financial assets held for 17,900,259,775.43 17,900,259,775.43
trading
Accounts receivables 5,419,314.60 5,522,261.31 102,946.71
Other receivables 47,908,184.37 51,367,132.22 3,458,947.85
Non-current assets that 1,120,000,000.00 -1,120,000,000.00
mature within one year
Other current assets 16,932,480,348.96 146,726,838.22 -16,785,753,510.74
Available-for-sale financial 2,713,455,624.66 -2,713,455,624.66
assets
Other non-current financial 3,124,148,754.77 3,124,148,754.77
assets
Deferred tax assets 714,003,966.82 713,088,032.20 -915,934.62
Deferred tax liabilities 14,019,256.05 115,581,138.18 101,561,882.13
Other comprehensive income -141,964,710.15 -1,370,740.85 140,593,969.30
Undistributed profits 30,784,308,899.94 30,949,968,585.63 165,659,685.69
Minority equity -20,011,735.87 -19,981,918.25 29,817.62
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Note: the above table only presents the items of the affected consolidated financial
statements, excluding the items of the unaffected consolidated financial statements.
(2) Changes in significant accounting estimates
Applicable √ N/A
(3)Since 2019, the implementation of new financial instrument standards, new
revenue standards or new leasing standards will be adjusted to implement the
items related to financial statements at the beginning of the year
√ Applicable N/A
Consolidated Balance Sheet
Unit: CNY
Assets Balance as at 31 Balance as at 1 Adjustment
December 2018 January 2019
Current assets:
Cash and cash
3,615,348,307.97 3,615,348,307.97
equivalents
Settlement reserves
Lending funds
Financial assets held for
17,900,259,775.43 17,900,259,775.43
trading
Financial assets measured
at fair value through
current profit or loss
Derivative financial assets
Notes receivables 242,542,097.76 242,542,097.76
Accounts receivables 5,419,314.60 5,522,261.31 102,946.71
Account receivables
financing
Prepayment 18,984,169.54 18,984,169.54
Premiums receivable
Reinsurance accounts
receivable
Reinsurance contract
reserve
Other receivables 47,908,184.37 51,367,132.22 3,458,947.85
Including:Interests
receivable
Dividends receivable
Buying back the sale of
financial assets
Inventories 13,892,118,587.74 13,892,118,587.74
Contract assets
Assets held for sale
Non-current assets due
1,120,000,000.00 -1,120,000,000.00
within one year
Other current assets 16,932,480,348.96 146,726,838.22 -16,785,753,510.74
Total current assets 35,874,801,010.94 35,872,869,170.19 -1,931,840.75
Non-current assets:
Disbursement of loans and
advances
Investment in debt
instruments
Available-for-sale financial
2,713,455,624.66 -2,713,455,624.66
assets
Investment in other debt
instruments
Held-to-maturity
investments
Long-term receivables
Long-term equity
9,423,328.82 9,423,328.82
investments
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Investment in other equity
instruments
Other non-current financial
3,124,148,754.77 3,124,148,754.77
assets
Investment property
Fixed assets 7,833,665,282.19 7,833,665,282.19
Construction in progress 154,535,104.82 154,535,104.82
Productive biological
assets
Oil and gas assets
Right-of-use asset
Intangible assets 1,781,961,687.10 1,781,961,687.10
Development expenses
Goodwill 276,001,989.95 276,001,989.95
Long-term deferred
907,636.00 907,636.00
expenses
Deferred tax assets 714,003,966.82 713,088,032.20 -915,934.62
Other non-current assets 205,012,184.92 205,012,184.92
Total non-current assets 13,688,966,805.28 14,098,744,000.77 409,777,195.49
Total assets 49,563,767,816.22 49,971,613,170.96 407,845,354.74
Current liabilities:
Short-term loans
Borrowings from the
central bank
Loans from other banks
Financial liabilities held for
trading
Financial liabilities
measured at fair value
through current profit or
loss
Derivative financial
liabilities
Notes payable
Accounts payables 1,261,282,397.89 1,261,282,397.89
Advance from customer 4,468,409,150.75 4,468,409,150.75
Contract liabilities
Financial assets sold for
repurchase
Customer brokerage
deposits
Securities underwriting
brokerage deposits
Receivings from
vicariously sold securities
Employee benefits
185,751,373.59 185,751,373.59
payable
Taxes payable 3,255,458,759.72 3,255,458,759.72
Other payables 6,457,301,511.01 6,457,301,511.01
Including:Interests payable
Dividends payable
Handling charges and
commissions payable
Reinsurance accounts
payable
Liabilities held for sale
Non-current liabilities due
within one year
Other current liabilities
Total current liabilities 15,628,203,192.96 15,628,203,192.96
Non-current liabilities:
Insurance contract
reserves
Long-term loans 109,088.00 109,088.00
Bonds payable
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Including: Preference
shares
Perpetual bonds
Lease liabilities
Long-term payables 198,404,248.85 198,404,248.85
Long-term payroll
payables
Accrued liabilities
Deferred income 98,513,500.00 98,513,500.00
Deferred tax liabilities 14,019,256.05 115,581,138.18 101,561,882.13
Other non-current
liabilities
Total non-current liabilities 311,046,092.90 412,607,975.03 101,561,882.13
Total liabilities 15,939,249,285.86 16,040,811,167.99 101,561,882.13
Shareholders' equity
Share capital 1,506,988,000.00 1,506,988,000.00
Other equity instruments
Including: preference
shares
Perpetual bonds
Capital reserves 741,704,076.44 741,704,076.44
Less: treasury stock
Other comprehensive
-141,964,710.15 -1,370,740.85 140,593,969.30
income
Special reserves
Surplus reserves 753,494,000.00 753,494,000.00
General risk reserve
Undistributed profits 30,784,308,899.94 30,949,968,585.63 165,659,685.69
Total equity attributable
to owners of the parent 33,644,530,266.23 33,950,783,921.22 306,253,654.99
company
Non-controlling interests -20,011,735.87 -19,981,918.25 29,817.62
Total owners' equity 33,624,518,530.36 33,930,802,002.97 306,283,472.61
Total liabilities and
49,563,767,816.22 49,971,613,170.96 407,845,354.74
owners' equity
Adjustment statement
The Company shall, from 1 January 2019, implement the accounting standard for
business enterprises No.22-Financial instrument recognition and measurement,
accounting standard for business enterprises No.23-Financial asset transfer, accounting
standard for business enterprises No.24-Hedge accounting, and accounting standard for
business enterprises No.37-Presentation of financial instruments revised by Ministry of
Finance in 2017. According to the requirements of the new financial instrument standards,
the relevant information of financial instruments shall be presented and the comparative
financial statements shall not be retroactively adjusted. This change of accounting
policies has been reviewed and approved by the sixth meeting of the sixth board of
directors.
Balance sheet of parent company
As at December 31 2019
Unit: CNY
Balance as at 31 Balance as at 1 January
Assets Adjustment
December 2018 2019
Current assets:
Cash and cash
1,849,574,170.07 1,849,574,170.07
equivalents
Financial assets held for
12,993,382,950.99 12,993,382,950.99
trading
Financial assets measured
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
at fair value through
current profit or loss
Derivative financial assets
Notes receivables 143,456,446.32 143,456,446.32
Accounts receivables 697,277,202.71 697,277,202.71
Account receivables
financing
Prepayment 250,592,759.90 250,592,759.90
Other receivables 949,089,213.52 950,355,344.98 1,266,131.46
Including:Interests
receivable
Dividends receivable 713,143.77 713,143.77
Inventories 10,378,077,915.50 10,378,077,915.50
Contract assets
Assets held for sale
Non-current assets due
700,000,000.00 -700,000,000.00
within one year
Other current assets 12,338,796,250.84 178,129.84 -12,338,618,121.00
Total current assets 27,306,863,958.86 27,262,894,920.31 -43,969,038.55
Non-current assets:
Investment in debt
instruments
Available-for-sale financial
1,231,283,468.30 -1,231,283,468.30
assets
Investment in other debt
instruments
Held-to-maturity
investments
Long-term receivables
Long-term equity
7,365,139,180.24 7,365,139,180.24
investments
Investment in other equity
instruments
Other non-current financial
1,581,596,418.19 1,581,596,418.19
assets
Investment property
Fixed assets 5,008,615,512.59 5,008,615,512.59
Construction in progress 92,262,796.92 92,262,796.92
Productive biological
assets
Oil and gas assets
Right-of-use asset
Intangible assets 1,252,482,032.31 1,252,482,032.31
Development expenses
Goodwill
Long-term deferred
expenses
Deferred tax assets 5,734,535.64 5,418,002.77 -316,532.87
Other non-current assets 179,613,182.42 179,613,182.42
Total Non-current
15,135,130,708.42 15,485,127,125.44 349,996,417.02
Assets
Total Assets 42,441,994,667.28 42,748,022,045.75 306,027,378.47
Current liabilities:
Short-term loans
Financial liabilities held for
trading
Financial liabilities
measured at fair value
through current profit or
loss
Derivative financial
liabilities
Notes payable
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Accounts payables 1,159,053,261.86 1,159,053,261.86
Advance from customer 14,339,833,591.92 14,339,833,591.92
Contract liabilities
Employee benefits
payable
Taxes payable 1,069,550,625.85 1,069,550,625.85
Other payables 183,715,786.65 183,715,786.65
Including:Interests payable
Dividends payable
Liabilities held for sale
Non-current liabilities due
within one year
Other current liabilities
Total current liabilities 16,752,153,266.28 16,752,153,266.28
Non-current liabilities:
Long-term loans 109,088.00 109,088.00
Bonds payable
Including：preference
shares
Perpetual bonds
Lease liabilities
Long-term payables 145,105,136.65 145,105,136.65
Long-term payroll
payables
Provisions
Deferred income
Deferred tax liabilities 76,269,444.97 76,269,444.97
Other non-current
liabilities
Total non-current
145,214,224.65 221,483,669.62 76,269,444.97
liabilities
Total liabilities 16,897,367,490.93 16,973,636,935.90 76,269,444.97
Owners' equity (or
shareholders' equity)
Share capital 1,506,988,000.00 1,506,988,000.00
Other equity instruments
Including: preference
shares
Perpetual bonds
Capital reserves 1,341,628,480.93 1,341,628,480.93
Less: treasury stock
Other comprehensive
income
Special reserves
Surplus reserves 753,494,000.00 753,494,000.00
Undistributed profits 21,942,516,695.42 22,172,274,628.92 229,757,933.50
Total owners' equity 25,544,627,176.35 25,774,385,109.85 229,757,933.50
Total liabilities and
42,441,994,667.28 42,748,022,045.75 306,027,378.47
owners' equity
Adjustment statement
The Company shall, from 1 January 2019, implement the accounting standard for
business enterprises No.22-Financial instrument recognition and measurement,
accounting standard for business enterprises No.23-Financial asset transfer, accounting
standard for business enterprises No.24-Hedge accounting, and accounting standard for
business enterprises No.37-Presentation of financial instruments revised by Ministry of
Finance in 2017. According to the requirements of the new financial instrument standards,
the relevant information of financial instruments shall be presented and the comparative
financial statements shall not be retroactively adjusted. This change of accounting
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
policies has been reviewed and approved by the sixth meeting of the sixth board of
directors.
VI.Taxes
1. Major tax types and rates
Tax type Taxation basis Tax rate
16%、13%、11%、10%、
Value-added tax (VAT) Output tax-deductible input tax
6%、19%
Sales revenue or or composite
Consumption tax
assessable price
Urban maintenance and construction tax Applicable turnover tax amount 7%、5%
Applicable income tax rate
Corporate income tax 25%、16.5%、0%、27%
Taxable income
Disclosure statement if there are various taxpaying bodies with different corporate
income tax rates
Company name Applicable tax rate
JSSJ Industry (HK) Holdings Co., Ltd. 16.50%
ZYG E-Commerce HK Limited 16.50%
Yanghe Hong Kong Distillery Co., Ltd. 16.50%
Yanghe Chile SPA 27%
YangHe International Investment Ltd, ZYG Ltd 0
ZYG LTD 0
ZYG Technology Investment Ltd 0
2. Other information
1. VAT shall be calculated and paid according to the difference between the current
output tax and the current deductible input tax, and the applicable output tax rates shall
be 16%, 13%, 11%, 6% and 19%. Since 1 April 2019, the Company's VAT rate was
adjusted to 13% from 16%, according to the No. 39, 2019 Announcement on Deepening
VAT Reform Policies issued by Ministry of Finance, State Administration of Taxation and
General Administration of Customs.
The VAT rate of Yanghe Chile SPA is 19%. JSSJ Industry (HK) Holdings Co., Ltd.,
Yanghe Hong Kong Distillery Co., Ltd.,ZYG E-Commerce HK Limited, ZYG LTD.,
YangHe International Investment Ltd., ZYG Technology Investment Ltd., do not pay VAT.
2. Ad valorem taxation: liquor consumption tax shall be calculated and paid according to
20% of the approved sales amount.The taxable liquor commissioned for processing shall
be taxed according to the sales price of similar liquor of the entrusted party, and if there
is no sales price of similar liquor, the taxable liquor shall be computed according to the
composition assessable price.Consumption tax on red wine (wine) is calculated at 10%
of sales.
Quantity-based taxation: liquor consumption tax is calculated and paid according to CNY
0.50 per kg.
3. The corporate income tax is calculated and paid at 25% of the taxable income amount.
The profits tax rate applicable to JSSJ Industry (HK) Holdings Co., Ltd., ZYG E-
Commerce HK Limited and Yanghe Hong Kong Distillery Co., Ltd. is 16.50%, and the
income tax rate applicable to Yanghe Chile SPA is 27%. YangHe International
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Investment Ltd, ZYG Ltd and ZYG Technology Investment Ltd are not required to pay
any taxes to the government according to local laws.
VII. Notes to the main items of the consolidated financial
statements (all currency unit is CNY, except other
statements)
1. Cash and cash equivalents
Unit: CNY
Item Closing balance Opening balance
Cash 4,067.27 24,103.07
Bank deposit 4,282,803,604.61 3,602,515,767.58
Other cash and cash equivalents 17,337,176.79 12,808,437.32
Total 4,300,144,848.67 3,615,348,307.97
Including: total deposit outbound 62,676,784.36 61,636,932.89
2. Financial assets held for trading
Unit: CNY
Item Closing balance Opening balance
Financial asset at fair value through
17,976,767,209.45 17,900,259,775.43
profit and loss
Including:
Equity instrument 2,012,500.00
Debt instrument 17,974,754,709.45 17,900,259,775.43
Including:
Total 17,976,767,209.45 17,900,259,775.43
Other notes:
Debt instruments are invested in bank financial products and trust financial products that
mature within one year.
3. Notes receivables
1）Classification of notes receivables
Unit: CNY
Item Closing balance Opening balance
Bank acceptance bill 659,266,780.81 242,542,097.76
Total 659,266,780.81 242,542,097.76
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Unit: CNY
Closing balance Opening balance
Item Book balance Provision for bad debt Book balance Provision for bad debt
Book value Book value
amount proportion amount proportion amount proportion amount proportion
Including:
Provision for bad debt of notes
659,266,780.81 100.00% 659,266,780.81 242,542,097.76 100.00% 242,542,097.76
receivables by portfolio
Including:
Bank acceptance bill portfolio 659,266,780.81 100.00% 659,266,780.81 242,542,097.76 100.00% 242,542,097.76
Total 659,266,780.81 100.00% 659,266,780.81 242,542,097.76 100.00% 242,542,097.76
Provision for bad debt by individual: 0.00
Unit: CNY
Closing balance
Item
Book balance Provision for bad debt Proportion Reason
Provision for bad debt by individual: 0.00
Unit: CNY
Closing balance
Item
Book balance Provision for bad debt Proportion Reason
Provision for bad debt by individual: 0.00
Unit: CNY
Closing balance
Item
Book balance Provision for bad debt Proportion Reason
Provision for bad debt by portfolio:
Unit: CNY
Closing balance
Item
Book balance Provision for bad debt Proportion
Bank acceptance bill portfolio
Notes to determine provision for bad debt by portfolio:
Provision for bad debt by portfolio:
Unit: CNY
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Closing balance
Item
Book balance Provision for bad debt Proportion
Notes to determine provision for bad debt by portfolio:
If provision for bad debt of notes receivable is calculated according to the general model of expected credit loss, please refer to the disclosure method
of other receivables to disclose the relevant information about provision for bad debt:
□ Applicable √ Not applicable
2) Notes receivable that have been endorsed to other parties by the Company but have not expired at the end of year
Unit: CNY
Item Derecognition at period end Not derecognition at period end
Bank acceptance bill 34,220,000.00
Total 34,220,000.00
4. Accounts receivables
(1) Disclosed by categories
Unit: CNY
Closing balance Opening balance
Category Book balance Provision for bad debt Book balance Provision for bad debt
Book value Book value
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Including:
Provision for bad debt by
18,852,659.14 100.00% 2,772,040.49 14.70% 16,080,618.65 7,711,012.90 100.00% 2,188,751.59 28.38% 5,522,261.31
portfolio
Including:
Risk portfolio 18,852,659.14 100.00% 2,772,040.49 14.70% 16,080,618.65 7,711,012.90 100.00% 2,188,751.59 28.38% 5,522,261.31
Total 18,852,659.14 100.00% 2,772,040.49 16,080,618.65 7,711,012.90 100.00% 2,188,751.59 28.38% 5,522,261.31
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Provision for bad debt by individual:
Unit: CNY
Closing balance
Name of client
Book balance Provision for bad debt Proportion Reason
Provision for bad debts by portfolio: CNY 583,288.90
Unit: CNY
Closing balance
Overdue years
Accounts receivables Provision for bad debt Proportion of provision
Overdue within 1 year 15,656,172.67 469,685.18 3.00%
Overdue 1-2 years 60,589.99 6,059.00 10.00%
Overdue 2-3 years 982,028.54 196,405.70 20.00%
Overdue more than 3
2,153,867.94 2,099,890.61 97.49%
years
Total 18,852,659.14 2,772,040.49 --
Notes to determine provision for bad debt by portfolio:
Provision for bad debt by portfolio:
Unit: CNY
Closing balance
Item
Book Balance Provision for bad debt Proportion
Notes to determine provision for bad debt by portfolio:
If provision for bad debt of notes receivable is calculated according to the general model
of expected credit loss, please refer to the disclosure method of other receivables to
disclose the relevant information about provision for bad debt:
□ Applicable √ Not applicable
Disclosed by aging
Unit: CNY
Aging Book value
Within 1 year (including 1 year) 15,656,172.67
1-2 years 60,589.99
2-3 years 982,028.54
Over 3 years 2,153,867.94
3-4 years 103,011.45
4-5 years 12,358.03
Over 5 years 2,038,498.46
Total 18,852,659.14
(2) Provision for bad debt that is accrued, recovered or reversed during this period
Provision for bad debts during this period:
Unit: CNY
Changes in the current period
Opening Closing
Category Recovered
balance Provision Write off Others balance
or reversed
Provision for
bad debt of
2,188,751.59 583,288.90 2,772,040.49
accounts
receivables
Total 2,188,751.59 583,288.90 2,772,040.49
Significant amount of reversal or recovery during this period
Unit: CNY
Company name Amount recovered or reversed Method
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(3)Top five entities with the largest balances of the accounts receivables
Unit: CNY
Proportion in the total
Company's name Closing balance accounts Provision amount
receivables
First 8,231,298.10 43.66% 246,938.94
Second 4,617,249.37 24.49% 138,517.48
Third 600,000.00 3.18% 600,000.00
Fourth 529,923.18 2.81% 15,897.70
Fifth 497,284.97 2.64% 14,918.55
Total 14,475,755.62 76.78%
5. Prepayment
（1）Analysis by aging
Unit: CNY
Closing balance Opening balance
Aging
Amount Proportion Amount Proportion
Within 1 year 198,626,119.93 99.26% 14,556,402.45 76.68%
1-2 years 972,506.99 0.48% 3,978,336.29 20.95%
2-3 years 413,485.27 0.21%
Over 3 years 103,213.00 0.05% 449,430.80 2.37%
Total 200,115,325.19 -- 18,984,169.54 --
Significant prepayment aging over 1 year without settlement on time :
No significant prepayment aging over 1 year are recorded in the ending balance.
（2）Top five entities with the largest balances of prepayment
Company’s name Closing balance Proportion in the total prepayment (%)
First 177,970,000.00 88.93
Second 9,081,148.00 4.54
Third 2,959,716.80 1.48
Fourth 1,710,654.91 0.86
Fifth 1,109,424.00 0.55
Total 192,830,943.71 96.36
6. Other receivables
Unit: CNY
Item Closing balance Opening balance
Other receivables 37,521,590.52 51,367,132.22
Total 37,521,590.52 51,367,132.22
（1）Other receivables
a) Other receivables by nature
Unit: CNY
Nature of other receivables Closing balance Opening balance
Savings deposits (infringement dispute) 65,747,048.93 65,747,048.93
Deposit 15,338,991.78 16,812,560.00
Cooperation 3,910,000.00 3,910,000.00
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Business loans, petty cash and others 28,136,955.41 24,873,608.88
Total 113,132,996.12 111,343,217.81
b）Provision for bad debt
Unit: CNY
Phase 1 Phase 2 Phase 3
Bad debt Expected credit Expected credit loss Expected credit loss
Total
losses in the next for lifetime (No credit for lifetime (Credit
12 months loss occurred) loss occurred)
Balance as at 1
491,627.89 59,484,457.70 59,976,085.59
January 2019
Change of opening
balance as at 1
—— —— —— ——
January 2019 in
current period
-- Move to phase 3 -122,271.81 122,271.81
Provision in 2019 116,445.88 18,256,611.48 18,373,057.36
Write-off in 2019 2,080,000.00 2,080,000.00
Other changes -657,737.35 -657,737.35
Balance as at 31
485,801.96 75,125,603.64 75,611,405.60
December 2019
Significant changes of loss provision in the book balance during this period.
□ Applicable √ Not applicable
Disclosure by aging
Unit: CNY
Aging Book value
Within 1 year(including 1 year) 10,470,134.36
1-2 years 5,255,906.32
2-3 years 4,830,781.64
Over 3 years 92,576,173.80
3-4 years 297,652.17
4-5 years 1,557,935.70
Over 5 years 90,720,585.93
Total 113,132,996.12
c）Provision for bad debt that is accrued, recovered or reversed during this period
Provision for bad debts during this period:
Unit: CNY
Changes in current period
Opening Recovere Closing
Category Other
balance Provision d or Write off balance
changes
reversed
Other
receivables bad 59,976,085.59 18,373,057.36 2,080,000.00 -657,737.35 75,611,405.60
debt provision
Total 59,976,085.59 18,373,057.36 2,080,000.00 -657,737.35 75,611,405.60
Significant amount of reversal or recovery during this period:
Unit: CNY
Company Name Recovery amount Method
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
d）Other receivables actually written off during this period
Unit: CNY
Item Written off amount
Other receivables actually written off 2,080,000.00
Significant other receivables actually written off
Unit: CNY
Procedures Arisen from related party
Company’s name Nature Amount Reason
performed transactions or not
Other statements:
e）Top five entities with the largest balances of other receivables
Unit: CNY
Proportion in Provisioning
Closing
Company’s name Category Aging total amount at period
balance
receivables end
Industrial
Savings deposit
Commercial Bank
of China Ltd. （Infringement 42,907,124.66 Over 5 years 37.93% 19,872,137.40
Zhengzhou Jiefang dispute）
Road branch.
Industrial
Savings deposit
Commercial Bank
of China Ltd. （Infringement 22,839,924.27 Over 5 years 20.19% 22,839,924.27
Kaifeng Haode dispute）
branch
Bankruptcy
administrator of
Jiangsu Juntai
Properties Deposit 15,000,000.00 Over 5 years 13.26% 15,000,000.00
Co.,Ltd., Suqian
Guotai Department
Store Co.,Ltd.
Nanjing Peilong
Sports Culture Co., Cooperation 3,910,000.00 Over 5 years 3.45% 3,910,000.00
Ltd.
Advance money Advance money
2,379,354.55 2-3 year 2.10% 71,380.64
for another for another
Total -- 87,036,403.48 -- 76.93% 61,693,442.31
7. Inventories
Whether the Company implement the new revenue standards.
□ Yes √ No
(1)Categories of Inventories
Unit: CNY
Closing balance Opening balance
Provision
Category Provision for
for stock
Book balance stock Book value Book balance Book value
obsolesce
obsolescence
nce
394,844,178. 389,136,605.0 8,125,769. 381,010,835.
Raw material 6,710,130.33 388,134,048.28
61 4 63 41
Work in 551,503,829. 530,437,380.4 530,437,380.
551,503,829.41
progress 41 6 46
1,704,339,66 1,704,339,664. 1,637,109,450. 1,637,109,45
Stocks
4.69 69 86 0.86
170
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Revolving 2,270,576.
7,316,606.29 5,046,030.00
materials 29
semi-finished 11,789,267,1 11,789,267,153 11,338,514,89 11,338,514,8
goods 53.89 .89 1.01 91.01
14,439,954,8 14,433,244,696 13,902,514,93 10,396,34 13,892,118,5
Total 6,710,130.33
26.60 .27 3.66 5.92 87.74
(2)Provision for stock obsolescence
Unit: CNY
Decreases in current
Increases in current period
Opening book period Closing book
Category
balance Recovery or balance
Provision Other Other
reversal
Raw material 8,125,769.63 2,248,496.85 3,664,136.15 6,710,130.33
Revolving
2,270,576.29 2,270,576.29
material
Total 10,396,345.92 2,248,496.85 5,934,712.44 6,710,130.33
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
8. Other current assets
Whether the Company implement the new revenue standards.
□ Yes √ No
Unit: CNY
Item Closing balance Opening balance
VAT to be deducted 159,457,511.39 116,379,452.59
Consumption tax to be deducted 7,020,885.09 21,568,108.81
Advance payment of income tax 16,641,257.99 8,779,276.82
Total 183,119,654.47 146,726,838.22
9. Long-term equity investments
Unit: CNY
Changes in current period
Adjustment
Profit or loss Closing balance
Opening s of other Other Cash divided Provision Closing
Investee recognized of provision for
balance Increase Decrease comprehen changes in or profit for Other balance
under equity impairment
sive equity declared impairment
method
income
Joint venture
Diageo
Internation
al Spirits 18,000,000.00 -6,220,574.92 178,619.29 -1,436,422.19 10,521,622.18
Company
Limited
Subtotal 18,000,000.00 -6,220,574.92 178,619.29 -1,436,422.19 10,521,622.18
Associated enterprise
Jiangsu Su
Wine
Culture 3,265,020.38 933,080.63 -510,000.00 453,413.80 4,141,514.81
Transmissi
on Co,Ltd.
Nanjing 3,639,991.56 405,497.30 4,045,488.86
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Hesong
Culture
Technology
Co.,Ltd.
Jiangsu
Xinghe
Investment 2,518,316.88 3,700,000.00 434,708.65 6,653,025.53
Manageme
nt Co.,Ltd.
Subtotal 9,423,328.82 3,700,000.00 1,773,286.58 -510,000.00 453,413.80 14,840,029.20
Total 9,423,328.82 21,700,000.00 -4,447,288.34 178,619.29 -510,000.00 -983,008.39 25,361,651.38
10. Other non-current financial assets
Unit: CNY
Item Closing balance Opening balance
Equity instrument investment 3,353,861,013.63 2,954,345,741.07
Debt instrument investment 1,696,990,657.53 169,803,013.70
Total 5,050,851,671.16 3,124,148,754.77
11. Fixed assets
Unit: CNY
Item Closing balance Opening balance
Fixed Assets 7,256,557,503.85 7,833,665,282.19
Total 7,256,557,503.85 7,833,665,282.19
(1)Details of fixed assets
Unit: CNY
Item Buildings and constructions Machinery equipment Transportation equipment Other equipment Total
Original cost of fixed assets
1.Opening Balance 7,865,532,249.94 3,108,421,413.39 65,422,432.44 375,598,572.77 11,414,974,668.54
2.Increase in current period 53,028,448.79 60,408,091.23 3,412,539.74 40,148,648.11 156,997,727.87
(1)External purchase 4,150,356.67 32,546,829.31 3,412,539.74 40,148,648.11 80,258,373.83
(2)Transfer from construction in progress 48,878,092.12 27,861,261.92 76,739,354.04
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(3) Increase from business combination
3.Decrease in current period 8,492,400.49 14,297,062.81 2,288,522.41 5,363,766.13 30,441,751.84
(1)Disposal or retirement 8,492,400.49 14,297,062.81 2,288,522.41 5,363,766.13 30,441,751.84
(2)Decrease from business combination
4.Closing Balance 7,910,068,298.24 3,154,532,441.81 66,546,449.77 410,383,454.75 11,541,530,644.57
Accumulated depreciation
1.Opening Balance 1,906,007,391.12 1,376,632,624.04 45,545,370.10 253,124,001.09 3,581,309,386.35
2.Increase in current period 376,588,559.24 284,242,262.56 6,903,922.95 54,274,521.15 722,009,265.90
(1)Provision 376,588,559.24 284,242,262.56 6,903,922.95 54,274,521.15 722,009,265.90
3.Decrease in current period 5,162,158.07 6,297,808.98 2,122,891.02 4,762,653.46 18,345,511.53
(1) Disposal or retirement 5,162,158.07 6,297,808.98 2,122,891.02 4,762,653.46 18,345,511.53
4.Closing Balance 2,277,433,792.29 1,654,577,077.62 50,326,402.03 302,635,868.78 4,284,973,140.72
Provision for fixed asset impairment
1.Opening Balance
2.Increase in current period
(1)Provision
3.Decrease in current period
(1)Disposal or retirement
4.Closing Balance
Book value
1.Closing book value 5,632,634,505.95 1,499,955,364.19 16,220,047.74 107,747,585.97 7,256,557,503.85
2.Opening book value 5,959,524,858.82 1,731,788,789.35 19,877,062.34 122,474,571.68 7,833,665,282.19
(2)Fixed assets acquired from finance lease
Unit: CNY
Item Original cost Accumulated depreciation Provision for impairment Book value
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(3)Investment properties without certification of right
Unit: CNY
Item Book value Reason for not having the certification of right
Yanghe Blue-collar workers apartment 143,409,809.42 In process
Yanghe workshop etc. 84,604,173.30 In process
Total 228,013,982.72
12. Construction in progress
Unit: CNY
Item Closing balance Opening balance
Construction in progress 263,153,505.12 153,747,041.24
Construction materials 788,063.58
Total 263,153,505.12 154,535,104.82
(1)Details of the construction in progress
Unit: CNY
Closing balance Opening balance
Item Provision for Provision for
Book Balance Book value Book Balance Book value
impairment impairment
R&D Center Building project 330,097.09 330,097.09 7,668,674.65 7,668,674.65
Packaging logistics project of Shuanggou Distillery industry park 3,145,312.97 3,145,312.97 12,080,019.36 12,080,019.36
Shuanggou new area brewing project 13,132,641.22 13,132,641.22 13,132,641.22 13,132,641.22
Shuanggou new area supporting project 492,307.69 492,307.69 492,307.69 492,307.69
Shuanggou packaging production line 10,610,699.88 10,610,699.88 10,610,699.88 10,610,699.88
Intelligent brewing (Mellowness 125 workshop) project 26,209,114.57 26,209,114.57 11,167,656.92 11,167,656.92
Siyang base three-dimensional warehouse, packaging production line
14,449,560.37 14,449,560.37 15,581,233.56 15,581,233.56
project
Qu-making third workshop sesame qu expansion phase II project 5,955,626.39 5,955,626.39 5,428,198.28 5,428,198.28
40,000 tons of pottery jar warehouse project 82,205,504.93 82,205,504.93
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Nanjing operation center building project 40,644,198.33 40,644,198.33
Other projects 65,978,441.68 65,978,441.68 77,585,609.68 77,585,609.68
Total 263,153,505.12 263,153,505.12 153,747,041.24 153,747,041.24
(2)Significant changes in construction in progress
Unit: CNY
Increase Proportion of Include:Ca
Transfer Other Interest Capitalizati Source
Opening in Closing accumulative pitalized
Item Budget into fixed decreases Progress capitaliza on rate for of
balance current balance project input in interest for
assets tion rate the period funds
period budget (%) the period
260,510,00 7,668,67 4,634,38 11,972,95
R&D Center Building project 330,097.09 197.87% Late stage Other
0.00 4.65 1.84 9.40
Shuanggou new area bottle Late stage Other
495,000,00 12,080,0 2,199,18 11,133,89 3,145,312.9
storage and packaging 207.12%
0.00 19.36 8.86 5.25 7
relocation project
Shuanggou new area brewing 528,180,00 13,132,6 13,132,641. Late stage Other
162.55%
project 0.00 41.22 22
Shuanggou new area 70,000,000 492,307. Late stage Other
492,307.69 173.17%
supporting project .00 69
Shuanggou packaging 120,000,00 10,610,6 10,610,699. Late stage Other
89.53%
production line 0.00 99.88 88
Intelligent brewing Other
45,000,000 11,167,6 15,041,4 26,209,114.
(Mellowness 125 workshop) 58.24% Late stage
.00 56.92 57.65 57
project
Siyang base three-dimensional Other
41,000,000 15,581,2 4,059,80 5,191,475. 14,449,560. Medium-
warehouse, packaging 50.93%
.00 33.56 1.92 11 37 term
production line project
Qu-making third workshop Other
9,800,000. 5,428,19 527,428. 5,955,626.3 Medium-
sesame qu expansion phase II 60.77%
00 8.28 11 9 term
project
40,000 tons of pottery jar 360,000,00 82,205,5 82,205,504. Medium- Other
22.83%
warehouse project 0.00 04.93 93 term
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Nanjing operation center 800,000,00 40,644,1 40,644,198. Other
5.08% Early stage
building project 0.00 98.33 33
2,729,490, 76,161,4 149,311, 28,298,32 197,175,063
Total -- -- --
000.00 31.56 961.64 9.76 .44
(3)Construction materials
Unit: CNY
Item Closing balance Opening balance
Book balance Provision for impairment Book value Book balance Provision for impairment Book value
Cable 6,320.03 6,320.03
Electric equipment 781,743.55 781,743.55
Total 788,063.58 788,063.58
13. Intangible assets
(1)Details of intangible assets
Unit: CNY
Computer
Item Land use right Patent right No-patent right technology Trademark right Total
software
Original cost of intangible assets
Opening balance 1,946,066,638.06 399,851,465.43 105,654,667.78 2,451,572,771.27
Increase in current period 5,437,510.08 12,793,902.50 18,231,412.58
Including: Acquired 5,437,510.08 12,793,902.50 18,231,412.58
Internally developed
Business combination
Decrease in current period
Including: Disposal
Closing balance 1,951,504,148.14 399,851,465.43 118,448,570.28 2,469,804,183.85
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Accumulated amortization of intangible
assets
Opening balance 247,135,065.66 384,868,550.40 37,607,468.11 669,611,084.17
Increase in current period 39,916,405.50 2,241,252.62 10,901,297.42 53,058,955.54
Including: Provision 39,916,405.50 2,241,252.62 10,901,297.42 53,058,955.54
Decrease in current period
Including: Disposal
Closing balance 287,051,471.16 387,109,803.02 48,508,765.53 722,670,039.71
Provision for impairment
Opening balance
Increase in current period
Including: Provision
Decrease in current period
Including: Disposal
Closing balance
Book value of intangible assets
Closing book value 1,664,452,676.98 12,741,662.41 69,939,804.75 1,747,134,144.14
Opening book value 1,698,931,572.40 14,982,915.03 68,047,199.67 1,781,961,687.10
The proportion of intangible assets formed through internal research and development of the Company in the balance of intangible assets at the end
of this period.
14. Goodwill
(1)Original cost of goodwill
Unit: CNY
Increase in current period Decrease in current period
Investee’s name or items resulting in goodwill Opening balance Closing balance
Business combination Disposal
Jiangsu Shuanggou Distillery Stock Co.,Ltd. 276,001,989.95 276,001,989.95
Jiangsu Zhaiyougou E-commerce Co.,Ltd 6,940,018.79 6,940,018.79
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Jiangsu Zhaibianli E-commerce Co.,Ltd 21,250,284.80 21,250,284.80
Guizhou Guijiu Co.,Ltd. 18,826,210.01 18,826,210.01
ZYG TECHNOLOGY INVESTMENT LTD 5,057,111.19 5,057,111.19
Guizhou Welcome Drink Stock Co.,Ltd 11,333,195.25 11,333,195.25
Dream Blue Chuanhaihui (Shiyan) Trade Investment Co.,Ltd. 3,405,542.42 3,405,542.42
Total 342,814,352.41 3,405,542.42 339,408,809.99
(2)Provision for impairment of goodwill
Unit: CNY
Increase in current period Decrease in current period Closing
Investee’s name or items resulting in goodwill Opening balance
Provision Disposal balance
Jiangsu Zhaiyougou E-commerce Co.,Ltd 6,940,018.79 6,940,018.79
Jiangsu Zhaibianli E-commerce Co.,Ltd 21,250,284.80 21,250,284.80
Guizhou Guijiu Co.,Ltd. 18,826,210.01 18,826,210.01
ZYG TECHNOLOGY INVESTMENT LTD 5,057,111.19 5,057,111.19
Guizhou Welcome Drink Stock Co.,Ltd 11,333,195.25 11,333,195.25
Dream Blue Chuanhaihui (Shiyan) Trade Investment Co.,Ltd. 3,405,542.42 3,405,542.42
Total 66,812,362.46 3,405,542.42 63,406,820.04
179
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Related information of asset groups or asset group portfolio containing goodwill
Statement of testing process of impairment of goodwill, key parameters (e.g. the forecast
growth rate at present value of future cash flows; the growth rate in stable period; profit
margin; the discount rate; predictive period and etc.) and determination methods of
recognizing goodwill impairment loss.
Goodwill impairment test according to the present value of the expected future cash flow
of the asset groups, group assets of recent three years based on the actual operation
situation and the future operation of the expectations, the estimated future cash flow of
the asset group, and according to the pre-tax discount rate of 18.47% discount after
calculating the recoverable amount of an asset group. After the test, there is no goodwill
impairment resulting from the acquisition of Jiangsu Shuanggou Distillery Stock Co., Ltd.
Effect of goodwill impairment test
Other statements:
15. Long-term prepaid expenses
Unit: CNY
Opening Increase in the Amortization for Other Closing
Item
balance current period the current period decreases balance
Renovation costs
907,636.00 381,215.44 1,034,707.84 254,143.60
of rented house
Total 907,636.00 381,215.44 1,034,707.84 254,143.60
16. Deferred tax assets/ deferred tax liabilities
(1)Deferred tax assets before offset
Unit: CNY
Closing balance Opening balance
Item Deductible
Deferred tax Deductible temporary Deferred tax
temporary
assets differences assets
differences
Provision for asset
81,682,220.18 20,415,104.69 69,593,195.47 16,780,145.22
impairment
Unrealized profit from
41,036,182.10 10,259,045.53 49,459,513.99 12,364,878.51
internal transaction
Deductible losses 456,081,306.89 114,020,326.72 298,587,033.87 74,646,758.47
The difference
between book value 2,721,478,322.51 680,369,580.63 2,437,185,000.00 609,296,250.00
of debt and tax base
Total 3,300,278,031.68 825,064,057.57 2,854,824,743.33 713,088,032.20
(2)Deferred tax liabilities before offset
Unit: CNY
Closing balance Opening balance
Item Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Valuation of
appreciation of
business combination 47,048,144.60 11,762,036.15 56,077,024.20 14,019,256.05
assets not under
common control
Changes in fair value
of financial assets held 516,851,327.69 127,497,047.01 405,199,394.80 101,561,882.13
for trading
Total 563,899,472.29 139,259,083.16 461,276,419.00 115,581,138.18
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(3)Deferred tax assets or liabilities presented as net value after offset
Unit: CNY
Offset amount of Closing balance of Opening balance
Opening offset
deferred tax deferred tax of deferred tax
amount of deferred
Item assets and assets or deferred assets or deferred
tax assets and
deferred tax tax liabilities after tax liabilities after
deferred tax liabilities
liabilities offset offset
Deferred tax assets 825,064,057.57 713,088,032.20
Deferred tax liabilities 139,259,083.16 115,581,138.18
(4)Details of unrecognized deferred tax assets
Unit: CNY
Item Closing balance Opening balance
Deductible temporary differences 97,994,641.66 146,980,533.21
Deductible losses 155,606,254.87 214,056,848.93
Total 253,600,896.53 361,037,382.14
(5)Deductible losses from unrecognized deferred tax assets will due on the
following years
Unit: CNY
Year Closing balance Opening balance Note
2020 27,264,949.28
2021 50,282,695.77 82,161,059.93
2022 67,671,298.41 67,671,298.41
2023 32,435,218.31 36,959,541.31
2024 5,217,042.38
Total 155,606,254.87 214,056,848.93 --
17. Other non-current assets
Whether the Company implement the new revenue standards
□ Yes √ No
Unit: CNY
Item Closing balance Opening balance
Compensation for land demolition 158,606,824.94 158,606,824.94
Prepayment of construction equipment and house purchase 45,791,625.24 46,405,359.98
Total 204,398,450.18 205,012,184.92
18. Accounts payables
(1)Presentation of accounts payables
Unit: CNY
Item Closing balance Opening balance
Material purchase 1,263,490,446.81 1,159,829,383.04
Construction and equipment payment 67,158,670.01 101,453,014.85
Total 1,330,649,116.82 1,261,282,397.89
19. Advance from customers
Whether the Company implement the new revenue standards
□ Yes √ No
(1)Presentation of advances from customers
Unit: CNY
181
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Item Closing balance Opening balance
Advance from customers 6,753,595,187.64 4,468,409,150.75
Total 6,753,595,187.64 4,468,409,150.75
20. Employee benefits payable
(1)Employee benefits payable shown as follows:
Unit: CNY
Increase in current Decrease in current
Item Opening balance period period Closing balance
Short-term benefits 185,559,166.78 2,031,622,068.19 2,101,279,279.03 115,901,955.94
Post-employment
benefits-defined 192,206.81 146,921,590.75 146,921,590.25 192,207.31
contribution plans
Termination benefits 175,459.20 175,459.20
Total 185,751,373.59 2,178,719,118.14 2,248,376,328.48 116,094,163.25
(2)Short-term employee benefits payable shown as follows:
Unit: CNY
Increase in current Decrease in current
Item Opening balance period period Closing balance
Wages, bonuses,
allowances and 181,365,224.92 1,778,242,627.14 1,843,778,130.83 115,829,721.23
grants
Employees’
97,954,214.71 97,954,214.71
welfare
Social insurance
14,860.09 70,992,345.87 70,992,345.88 14,860.08
premiums
Including: Medical
7,972.00 57,944,553.64 57,944,553.64 7,972.00
Insurance
Work-related injury
6,875.34 4,441,821.67 4,441,821.68 6,875.33
insurance
Maternity
12.75 8,605,970.56 8,605,970.56 12.75
insurance premium
Housing funds 1,149,180.80 75,697,089.01 76,793,610.01 52,659.80
Labor union
expenditures and
3,029,900.97 8,735,791.46 11,760,977.60 4,714.83
employee
education funds
Total 185,559,166.78 2,031,622,068.19 2,101,279,279.03 115,901,955.94
(3)Defined Contribution Plan shown as follows:
Unit: CNY
Increase in current Decrease in current
Item Opening balance period period Closing balance
Basic endowment
191,322.73 142,700,163.30 142,700,162.80 191,323.23
insurance premium
Unemployment
884.08 4,221,427.45 4,221,427.45 884.08
insurance premium
Total 192,206.81 146,921,590.75 146,921,590.25 192,207.31
21. Taxes payable
Unit: CNY
Item Closing balance Opening balance
Value-added tax 27,126,012.81 189,165,872.30
182
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Consumption tax 184,097,543.52 718,733,315.03
Enterprise income tax 1,548,461,975.77 2,284,751,258.08
Individual Income Tax 11,273,828.79 8,034,721.58
Urban maintenance and construction tax 11,574,124.18 16,248,651.42
Land use tax 4,322,610.74 13,930,499.24
Property tax 14,349,066.89 5,044,392.51
Education Surcharge and Local Education
11,016,464.11 15,946,560.04
Surcharge
Stamp tax 731,524.41 1,271,183.78
Integrated fund 2,954.09 560.58
Other tax 2,331,901.16 2,331,745.16
Total 1,815,288,006.47 3,255,458,759.72
22. Other payables
Unit: CNY
Item Closing balance Opening balance
Other payables 6,521,146,762.07 6,457,301,511.01
Total 6,521,146,762.07 6,457,301,511.01
(1) Other payables
(a)Categories by nature
Unit: CNY
Item Closing balance Opening balance
Dealer unsettled discount 2,558,631,122.51 2,298,765,700.00
Dealer deposit 2,668,012,523.41 2,929,101,334.21
Dealer risk pledged deposit 718,922,266.50 659,646,746.28
Accrued expenses 306,270,802.86 287,765,353.59
Quality guarantee deposit and
180,729,458.44 188,186,132.55
performance deposit
Other payables 88,580,588.35 93,836,244.38
Total 6,521,146,762.07 6,457,301,511.01
(b) Other important payables aging more than 1 year
Unit: CNY
Reasons for being unpaid or
Item Closing balance
written-off
Dealer risk pledged deposit and dealer Dealer risk pledged deposit
632,122,994.05
deposit and dealer deposit
Total 632,122,994.05 --
23. Long-term loans
(1)Long-term loans by category
Unit: CNY
Item Closing balance Opening balance
Credit loans 72,723.00 109,088.00
Total 72,723.00 109,088.00
24. Long-term payables
Unit: CNY
Item Closing balance Opening balance
Special accounts payables 197,623,728.85 198,404,248.85
Total 197,623,728.85 198,404,248.85
(1)Long-term payables by nature
Unit: CNY
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Item Closing balance Opening balance
(2)Special accounts payables
Unit: CNY
Decrease in
Increase in current
Item Opening balance current Closing balance Reason
period
period
Compensation for
replacement of 198,404,248.85 780,520.00 197,623,728.85
employee status
Total 198,404,248.85 780,520.00 197,623,728.85 --
25. Deferred incomes
Unit: CNY
Increase in Decrease in Closing
Item Opening balance Reason
current period current period balance
Government
98,513,500.00 8,757,000.00 89,756,500.00
grants
Total 98,513,500.00 8,757,000.00 89,756,500.00 --
Projects involving government grants:
Unit: CNY
Non- Other Cost Relevant
Increase
Liability Opening operating income reduction in Other Closing to asset
in current
item balance income in in current current changes balance or
period
current period period period income
Hubei
Lihuacun
liquor
industry
liquor
brewing, 30,310,60 4,257,00 26,053,60
Asset
filling 0.00 0.00 0.00
project
supporting
facilities
constructio
n subsidies
Special
fund for
packaging
18,000,00 3,000,00 15,000,00
logistics Asset
0.00 0.00 0.00
project in
Shuanggou
new area
Special
fund for
Harbin
41,202,90 41,202,90
Binzhou Asset
0.00 0.00
brewery
constructio
n project
Shuanggou
sewage 9,000,000. 1,500,00 7,500,000
Asset
treatment 00 0.00 .00
project
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
26. Share capital
Unit: Share
Increases/decreases in the current period (+, -)
Opening Conversion Closing
balance Issuance of Share of reserves balance
Others Subtotal
new shares donation funds into
shares
Total number 1,506,988,00 1,506,988,000
of shares 0.00 .00
27. Capital reserves
Unit: CNY
Increase in Decrease in
Item Opening balance Closing balance
current period current period
Share premium 741,674,076.44 171,526.31 741,502,550.13
Other capital reserves 30,000.00 30,000.00
Total 741,704,076.44 171,526.31 741,532,550.13
Other statements, including the change in this period and the reasons for the change
During this period, the decrease of capital reserves was CNY 171,526.31, resulting from
capital decrease of minority shareholders of Dream Blue Haichuanhui (Shiyan) Trade
Investment Co.,Ltd., the holding subsidiary of the Company.
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
28. Other comprehensive incomes
Unit: CNY
Current period
Less: Previously Less: previously Amount
Opening Amount in Amount attribute to Closing
Item recognized in other recognized in other attribute to
balance current period Less: non-controlling balance
comprehensive comprehensive income parent
before income income tax shareholders after
income transferred to transferred to retained company after
tax tax
profit or loss earnings tax
2.Other consolidate incomes
that will be reclassified into profit -1,370,740.85 -2,228,748.45 -2,238,030.31 9,281.86 -3,608,771.16
and loss
Including: other comprehensive
income will be reclassified into
178,619.29 178,619.29 178,619.29
profits or losses under the
equity method
Difference from translation of
financial statements in foreign -1,370,740.85 -2,407,367.74 -2,416,649.60 9,281.86 -3,787,390.45
currency
Total other comprehensive
-1,370,740.85 -2,228,748.45 -2,238,030.31 9,281.86 -3,608,771.16
income
Other statements, including adjustments for valid portion of the gains and or losses from cash flow hedging transferring to initial recognition amount of
projects hedged.
29. Surplus reserves
Unit: CNY
Item Opening balance Increase in current period Decrease in current period Closing balance
Statutory surplus reserves 753,494,000.00 753,494,000.00
Total 753,494,000.00 753,494,000.00
Statements for surplus reserves include increase or decrease changes and change reasons this period:
The statutory surplus reserve has reached 50% of the registered capital, and the statutory surplus reserve will not be accrued during this period.
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30. Undistributed profits
Unit: CNY
Item Current period Previous period
Undistributed profit before adjustment at the end of the last
30,784,308,899.94 26,511,938,505.25
year
Adjustment in the total undistributed profits at the
165,659,685.69 0.00
beginning of year
Undistributed profit after adjustment at the beginning of
30,949,968,585.63 26,511,938,505.25
year
Plus: net profit attributable to owners of the parent
7,382,822,726.87 8,115,189,794.69
company for the current period
Ordinary share dividends payable 4,822,361,600.00 3,842,819,400.00
Undistributed profits at the end of the period 33,510,429,712.50 30,784,308,899.94
Statements for adjusting undistributed profits at the beginning of the period:
(1)Due to retrospective adjustment according to Accounting Standards for Business
Enterprises and related new rule, undistributed profit at the beginning
increases/decreases by CNY 165,659,685.69.
(2)Due to changes of accounting policies, undistributed profit at the beginning
increases/decreases by CNY 0.00.
(3)Due to correction of accounting errors, undistributed profit at the beginning
increases/decreases by CNY 0.00.
(4)Due to change of the merged scope, undistributed profit at the beginning of the period
increases/decreases by CNY 0.00.
(5)Due to other influences, undistributed profit at the beginning totally
increases/decreases by CNY 0.00.
31. Operating income and operating costs
Unit: CNY
Current period amount Previous period amount
Item
Operating income Operating cost Operating income Operating cost
Primary business 22,161,278,307.05 5,772,779,588.18 23,186,902,149.00 5,527,417,445.92
Other business 965,198,578.02 853,582,663.06 972,899,845.68 825,824,752.35
Total 23,126,476,885.07 6,626,362,251.24 24,159,801,994.68 6,353,242,198.27
Whether the Company implement the new revenue standards
□ Yes √ No
32. Taxes and surcharges
Unit: CNY
Item Current period amount Previous period amount
Consumption tax 2,605,319,409.77 3,052,824,791.60
Urban maintenance and
254,046,554.00 306,402,753.67
construction tax
Educational surcharge 252,226,373.49 304,586,562.85
Property tax 61,403,035.90 61,463,159.37
Land use tax 17,976,049.12 22,733,353.58
Stamp tax 8,809,094.29 10,995,368.32
Increment tax on land value 1,567,679.81 10,699,953.12
Environmental protection tax 126,776.37 224,031.57
Others 4,853.34
Total 3,201,479,826.09 3,769,929,974.08
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
33. Selling and distribution expenses
Unit: CNY
Item Current period amount Previous period amount
Advertising promotion expense 1,566,903,873.47 1,492,333,124.96
Payroll 502,836,431.55 505,358,495.38
Shipping and handling cost[Note] 10,327,005.41 5,385,839.29
Labor expense 156,239,051.28 94,353,482.05
Travel expense 365,735,100.77 371,943,599.53
Business entertainment expense 3,809,795.16 2,468,968.74
Other expense 85,859,912.95 89,558,118.27
Total 2,691,711,170.59 2,561,401,628.22
34. General and administrative expenses
Unit: CNY
Item Current period amount Previous period amount
Payroll 727,031,403.39 645,451,421.56
Travel expense 60,829,942.03 51,131,089.76
Office allowance 7,528,872.00 9,563,500.30
Wate, electric and steam expense 64,916,608.02 64,140,517.86
Business entertainment expense 18,999,148.74 17,889,974.15
Depreciation cost 489,966,400.69 473,056,556.54
Rental expense 2,562,113.84 9,114,114.28
Repair charge 54,009,927.49 42,487,322.35
Amortization of intangible assets 53,008,955.54 50,118,316.96
Vehicle use expense 20,175,918.19 19,765,733.87
Shipping and handling cost 41,141,371.90 43,220,136.60
Other expense 316,321,065.17 278,326,418.38
Total 1,856,491,727.00 1,704,265,102.61
35. Research & Development expenses
Unit: CNY
Item Current period amount Previous period amount
Material expenses 85,700,940.30 5,487,765.94
Payroll 54,476,101.25 13,387,099.46
Other expense 19,788,552.33 8,690,352.23
Total 159,965,593.88 27,565,217.63
Other statements:
During this period, seven raw liquor production R&D projects were newly registered in
Suqian Municipal Science and Technology Bureau, resulting in a substantial increase in
the amount of R&D expenses.
36. Financial expenses
Unit: CNY
Item Current period amount Previous period amount
Interest expense 2,618.00 3,273.00
Bill discount expense 633,304.85
Less: Interest income 77,589,503.94 69,133,580.05
Plus: Losses from currency exchange
-3,270,386.19 652,223.14
(Less: income)
Plus: Bank charges 1,797,415.87 3,339,447.15
Total -78,426,551.41 -65,138,636.76
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
37. Other income
Unit: CNY
Sources of other income Current period Previous period
Government grants received 83,307,366.37 59,870,221.67
Withholding personal tax commission 1,670,388.78 3,482,761.39
Total 84,977,755.15 63,352,983.06
38. Investment income
Unit: CNY
Item Current period amount Previous period amount
Investment income from long-term equity
-4,447,288.34 1,819,591.30
investments under the equity method
Investment income from disposing long-
-43,877.59
term equity investments
Investment income from financial assets
40,267,966.45
held for trading during the holding period
Investment income from disposal of
814,777,407.10
financial assets held for trading
Investment income from available-for-sale
35,123,288.49
financial assets during the holding period
Investment income from disposal of
56,995,537.28
available-for-sale financial assets
Other investment income 824,354,377.42
Total 850,554,207.62 918,292,794.49
Other statements:
Other investment income is generated from the financial products purchased by the
Company.
39. Gains/losses of changes in fair value
Unit: CNY
Gains/losses of changes in fair value Current period amount Previous period amount
Financial assets held for trading 158,679,505.33
Total 158,679,505.33
40. Losses from credit impairment
Unit: CNY
Item Current period amount Previous period amount
Bad debt losses of other receivables -18,373,057.36
Bad debt losses of accounts receivables -583,288.90
Total -18,956,346.26
41. Losses from asset impairment
Whether the Company implemented the new revenue standards
□ Yes √ No
Unit: CNY
Item Current period amount Previous period amount
Bad debt losses -1,098,948.45
Losses from provision for stock
-2,248,496.85
obsolescence
Total -2,248,496.85 -1,098,948.45
42. Gains from disposal of assets
Unit: CNY
Gains from disposal of assets Current period amount Previous period amount
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Gains from disposal of fixed assets 19,983,101.67 24,568,477.22
43. Non-operating income
Unit: CNY
Amount included in non-
Item Current period amount Previous period amount recurring profit and loss in
current period
Government grants 2,298,016.82 2,298,016.82
Liquidated damages income 11,254,294.46 15,698,217.08 11,254,294.46
Compensation payment 7,819,571.36 10,840,761.81 7,819,571.36
Account payables that are
185,947.97 9,540,839.98 185,947.97
unable to pay
Others 688,123.76 1,851,187.31 688,123.76
Total 22,245,954.37 37,931,006.18 22,245,954.37
Government grants included in current profits and losses:
Unit: CNY
Whether the
Current Previous Related to
grants affects Whether it is
Item Body Reason Type period period assets/related
current year profit special grant
amount amount to earnings
and loss
44. Non-operating expenses
Unit: CNY
Amount included in
Item Current period amount Previous period amount non-recurring profit and
loss in current period
Donation expenses 5,546,180.00 8,890,000.00 5,546,180.00
Losses from retirement of
6,141,958.08 2,364,904.26 6,141,958.08
fixed asset
Integrated fund 79,543.09 68,150.83
Reparations 1,442,510.50 227,180.00 1,442,510.50
Others 114,100.03 846,799.20 114,100.03
Total 13,324,291.70 12,397,034.29 13,244,748.61
45. Income tax expense
(1)Statement of income tax expense
Unit: CNY
Item Current period amount Previous period amount
Current period income tax 2,472,964,546.78 2,792,139,209.45
Deferred income tax -88,251,204.98 -68,283,315.11
Total 2,384,713,341.80 2,723,855,894.34
(2)Adjustment for accounting profit and income tax expense
Unit: CNY
Item Current period amount
Total profit 9,770,804,257.01
Income tax expenses determined by statutory/applicable
2,442,701,064.25
tax rate
Impact from subsidiaries’ different tax rates -531,987.54
Adjust for impact from income tax expense in previous
-10,190,064.58
period
Impact from non-taxable income 4,164,697.62
Non-deductible costs, expenses and losses 3,890,772.90
Deductible from deferred tax assets in previous period -26,525,499.33
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Temporary differences due to unrecognized deferred tax
793,275.42
asset during current period
Add the effect of the deduction -29,588,916.94
Income tax expense 2,384,713,341.80
46. Net other comprehensive income
Please refer to Note VII-28. for details during this period.
47. Consolidated cash flow items
(1)Cash received from other operation activities
Unit: CNY
Item Current period amount Previous period amount
Risk deposit 59,275,520.22 41,386,027.21
Dealer deposit 2,602,491.66 1,078,922,221.42
Interest income 77,589,503.94 69,133,580.05
Liquidated damages income 11,254,294.46 15,698,217.08
Government grants 76,848,383.19 51,034,055.00
Commission for withholding tax 1,670,388.78 3,482,761.39
Others 31,109,582.42 233,913,582.83
Total 260,350,164.67 1,493,570,444.98
Statements for cash received from other operation activities:
(2)Cash paid for other operating activities
Unit: CNY
Item Current period amount Previous period amount
Transportation fee 51,468,377.31 73,756,101.88
Advertising promotion expense 1,751,245,676.57 1,514,147,166.86
Rental expense 10,604,573.95 11,809,301.97
Repair charge 54,113,100.25 42,532,923.93
Travel expense 450,385,225.31 393,625,149.65
Entertainment expense 22,808,943.90 20,358,942.89
Insurance expense 5,386,711.21 4,809,096.29
Labor expense 183,149,910.74 135,194,429.87
Others 435,334,271.31 990,691,742.63
Total 2,964,496,790.55 3,186,924,855.97
Statements for cash paid for other operating activities:
(3)Cash received from other investing activities
Unit: CNY
Item Current period amount Previous period amount
Statements for cash received from other investing activities:
(4)Cash paid for other investing activities
Unit: CNY
Item Current period amount Previous period amount
Statements for cash paid from other investing activities:
(5)Cash received for other financing activities
Unit: CNY
Item Current Period Amount Previous period Amount
Letter of credit deposit 1,500,000.00
Total 1,500,000.00
Statements for cash received for other financing activities:
(6)Cash paid for other financing activities
Unit: CNY
191
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Item Current period amount Previous period amount
A cash payment by minority shareholder 750,000.00
Total 750,000.00
Statements for cash paid for other financing activities:
48. Supplementary information to consolidated statement of cash flow
(1)Supplementary information to consolidated statement of cash flow
Unit: CNY
Item Current period amount Previous period amount
Reconciliation of net profit to cash
-- --
flow from operating activities
Net profit 7,386,090,915.21 8,115,329,894.50
Add: Provision for asset impairment 21,204,843.11 1,098,948.45
Depreciation of fixed asset, oil & gas
722,009,265.90 707,143,699.48
assets and productive biological assets
Amortization of intangible assets 53,058,955.54 50,118,316.96
Amortization of long-term deferred
1,034,707.84 184,008.16
expenses
Losses from disposal of fixed assets,
intangible assets and other long-term -19,983,101.67 -24,568,477.22
Assets
Losses on retirement of fixed assets 6,141,958.08 2,364,904.26
Losses from changes in fair value -158,679,505.33
Financial expense -3,267,768.19 655,496.14
Losses on investments -850,554,207.62 -918,292,794.49
Decrease in deferred tax asset -111,976,025.37 -64,344,859.11
Increase in deferred tax liabilities 23,677,944.98 -3,938,515.05
Decrease in inventory -537,439,892.94 -1,027,648,654.29
Decrease in operation receivables -612,187,011.25 49,163,073.33
Increase in operation payables 878,760,793.12 2,169,483,775.16
Net cash flow from operating activities 6,797,891,871.41 9,056,748,816.28
Significant investing and financing
-- --
activities not Involving cash flow:
Net change in cash & cash
-- --
equivalents
Closing balance of cash 4,300,144,848.67 3,615,348,307.97
Less:opening balance of cash
3,615,348,307.97 1,749,952,876.18
equivalents
Net change in cash and cash
684,796,540.70 1,865,395,431.79
equivalents
(2)Composition of cash and cash equivalents
Unit: CNY
Item Closing balance Opening balance
Cash 4,300,144,848.67 3,615,348,307.97
Including:cash on hand 4,067.27 24,103.07
Unrestricted bank deposit 4,282,803,604.61 3,602,515,767.58
Other unrestricted cash & cash
17,337,176.79 12,808,437.32
equivalents
Closing balance of cash and cash
4,300,144,848.67 3,615,348,307.97
Equivalents
49. Foreign currency transactions
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(1)Foreign currency balance
Unit: CNY
Closing balance in foreign Closing balance in
Item Exchange rate
currency CNY
Cash and cash equivalents -- -- 63,771,419.21
Including：USD 5,851,102.50 6.9762 40,818,461.26
EUR
HKD 2,267,649.63 0.89578 2,031,315.19
CLP 2,259,388,389.00 0.0092599 20,921,642.76
Receivables -- --
Including：USD
EUR
HKD
Other receivables 423,149.83
Including：HKD 472,381.42 0.89578 423,149.83
Other payables 1,312,830.59
Including：HKD 1,465,427.84 0.89578 1,312,700.95
CLP 14,000.00 0.0092599 129.64
Long-term loans -- --
Including：USD
EUR
HKD
(2) Description of the overseas business entity, including the important foreign
business entity, which shall disclose its main foreign business place, bookkeeping
standard currency and selection basis, and shall also disclose the reason for the
change of the bookkeeping standard currency.
√ Applicable N/A
Foreign business Functional
Operation site Choosing reason
entities currency
JSSJ Industry （HK） Currency in the main economic
Hong Kong, China HKD
Holdings Co., Limited environment of business operations
ZYG E-Commerce HK Currency in the main economic
Hong Kong, China HKD
Limited environment of business operations
ZYG LTD Currency in the main economic
Cayman Islands USD
environment of business operations
YangHe International Currency in the main economic
British Virgin Islands USD
Investment Ltd environment of business operations
ZYG Technology Currency in the main economic
British Virgin Islands USD
Investment Ltd environment of business operations
Yanghe Chile SPA Currency in the main economic
Santiago, Chile CLP
environment of business operations
Yanghe Hong Kong Currency in the main economic
Hong Kong, China HKD
Distillery Co., Ltd. environment of business operations
50. Government grants
(1)Details of government grants
Unit: CNY
Amount included
Item Amount Presentation
in profit or loss
193
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Awards and subsidies for the second batch of
projects of Suqian guide fund for industrial 1,500,000.00 Other income 1,500,000.00
development (industrial development) in 2018
The urgent needed talents for development of
1,687,500.00 Other income 1,687,500.00
north Jiangsu special fund
Suqian Yanghe new district economic Other income
5,543,000.00 5,543,000.00
development bureau cash reward funds
Tap water sewage treatment return 1,558,900.00 Other income 1,558,900.00
Pollution discharge subsidies 3,000,000.00 Other income 3,000,000.00
2017 Suqian green demonstration enterprise Other income
300,000.00 300,000.00
bonus
2018 provincial financial incentive fund for Other income
300,000.00 300,000.00
enterprise R&D expenses
Steady position subsidies 1,565,984.27 Other income 1,565,984.27
Government tax incentives 5,290,000.00 Other income 5,290,000.00
Industrial support fund of Ningxiang economic and Other income
6,710,080.00 6,710,080.00
technological development zone
Nanjing Hexi financial cluster development special Other income
11,714,859.86 11,714,859.86
support funds
2018 Special fund for industrial and information Other income
technology development of Guizhou province (the 600,000.00 600,000.00
second batch of energy conservation projects)
Special fund of Encouraging and promoting Other income
1,000,000.00 1,000,000.00
Sihong county tourism development
2018 Suqian municipal bureau of industry and Other income
information technology municipal guide fund for
300,000.00 300,000.00
industrial development (green demonstration
enterprise)
Office space rental subsidy 500,000.00 Other income 500,000.00
2019 financial incentive fund for enterprise R&D Other income
500,000.00 500,000.00
investment
Guiding funds for local industrial development 30,914,915.24 Other income 30,914,915.24
Non-operating
Shanggou recruit veterans VAT relief 1,984,000.00 1,984,000.00
income
Other income /
Others 1,879,143.82 Non-operating 1,879,143.82
income
Transfer of current deferred earnings 8,757,000.00 Other income 8,757,000.00
Total 85,605,383.19 85,605,383.19
VIII. Changes in consolidated scope
1. Others
Explain the change of merger scope caused by other reasons (such as new subsidiary,
liquidation subsidiary, etc.) and the relevant situation:
A. Establishment of subsidiaries
In September 2018, the Company registered and established Yanghe Hong Kong
Distillery Co., Ltd. in Hong Kong, which was invested in October 2019 and included in the
consolidated financial statements from October 2019.
B. Cancellation of subsidiaries
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(1)Jiangsu Guanmeng Information Technology Co., Ltd., the holding subsidiary, was
liquidated and cancelled, and on 12 February 2019, it obtained the Notice of approval for
cancellation registration of the company from Suzhou Xiangcheng District Market
Supervision Administration. As of March 2019, it is no longer included in the consolidated
scope of the consolidated financial statements.
(2) Jiangsu Oubaosi International Trade Co., Ltd., the holding subsidiary, was liquidated
and cancelled. On 3 January 2019, it obtained the Notice of approval for cancellation
registration of the company from Nanjing Jiangbei New District Management Committee
Market Supervision Administration. As of February 2019, it is no longer included in the
consolidated scope of the consolidated financial statements.
(3) Jiangsu Yanghe Packaging Co., Ltd., the holding subsidiary, was liquidated and
cancelled, and on 2 February 2019, it obtained the Notice of approval for cancellation
registration of the company from Suqian Municipal Administration for Industry and
Commerce. As of March 2019, it is no longer included in the consolidated scope of the
consolidated financial statements.
(4) Dream Blue Haichuanhui (Shiyan) Trade and Investment Co., Ltd., the holding
subsidiary, was liquidated and cancelled, and on 21 September 2019, it obtained the
Notice of approval for cancellation registration of the company from Shiyan Municipal
Administration Approval Bureau. As of October 2019, it is no longer included in the
consolidated scope of the consolidated financial statements.
(5) Xuzhou Huaqu Wine Development Co., Ltd., the holding subsidiary, was liquidated
and cancelled, and on 24 October 2019, it obtained the Notice of approval for
cancellation registration of the company from Xuzhou Market Supervision Administration.
As of November 2019, it is no longer included in the consolidated scope of the
consolidated financial statements.
IX. Interests in other entities
1. Interests in subsidiaries
(1) Group composition:
Major Shareholding
Name of Place of Nature of Acquisition
business
subsidiaries registration business Direct Indirect method
location
Suqian,
Jiangsu Yanghe Suqian, Jiangsu
Jiangsu Liquor package 100.00% Establishment
Package Co., Ltd. province
province
Nanjing Yanghe Nanjing,
Nanjing, Jiangsu
Blue Classic Jiangsu Commerce 100.00% Establishment
province
Co.,Ltd. province
Beijing Yanghe
Fengtai,Beijin
Commerce and Fengtai,Beijing Commerce 100.00% Establishment
g
Trade Co.,Ltd.
Jiangsu Huaqu Nanjing,
Nanjing, Jiangsu
Wine Group Jiangsu Commerce 97.00% Establishment
province
Co.,Ltd. province
Suqian Tianhai Suqian,
Suqian, Jiangsu
Commerce and Jiangsu Commerce 100.00% Establishment
province
Trade Co.,Ltd. province
195
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Huaian Huaqu Huaian,
Huaian, Jiangsu
Wine Development Jiangsu Commerce 100.00% Establishment
province
Co.,Ltd. province
Suqian Yanghe Suqian,
Suqian, Jiangsu
Guibinguan Jiangsu Hotel industry 100.00% Establishment
province
Co.,Ltd. province
Jiangsu Huaqu Nanjing,
Nanjing, Jiangsu
Wine Group Jiangsu Commerce 100.00% Establishment
province
Nanjing Co.,Ltd. province
Suqian,
Su Wine Group Suqian, Jiangsu
Jiangsu Commerce 83.63% 16.37% Establishment
Trade Co.,Ltd. province
province
Wuxi Huaqu Wine
Wuxi, Jiangsu Wuxi, Jiangsu
Development Commerce 100.00% Establishment
province province
Co.,Ltd.
Taizhou Huaqu Taizhou,
Taizhou, Jiangsu
Wine Development Jiangsu Commerce 100.00% Establishment
province
Co.,Ltd. province
Jiangsu Huaqu Nantong,
Nantong, Jiangsu
Wine Group Jiangsu Commerce 100.00% Establishment
province
Nantong Co.,Ltd. province
Jiangsu Huaqu Suzhou,
Suzhou, Jiangsu
Wine Group Jiangsu Commerce 100.00% Establishment
province
Suzhou Co.,Ltd. province
Jiangsu Huaqu Yancheng,
Yancheng,
Wine Group Jiangsu Commerce 100.00% Establishment
Jiangsu province
Yancheng Co.,Ltd. province
Jiangsu Yanghe
Suqian,
Liquor Operation Suqian, Jiangsu
Jiangsu Commerce 100.00% Establishment
Mangement province
province
Co.,Ltd.
Jiangsu Sihong,
Sihong, Jiangsu
Shuanggou Liquor Jiangsu Commerce 100.00% Establishment
province
OperationCo.,Ltd. province
Jiangsu Dongdi Suqian,
Suqian, Jiangsu
Union International Jiangsu Commerce 100.00% Establishment
province
Trade Co.,Ltd. province
Jiangsu
Suqian,
Dongdixinghui Suqian, Jiangsu
Jiangsu Commerce 100.00% Establishment
International Trade province
province
Co.,Ltd.
Suqian,
Suqian Blue Dream Suqian, Jiangsu
Jiangsu Commerce 100.00% Establishment
Trade Co.,Ltd. province
province
Siyang Lantu Siyang,
Siyang, Jiangsu
Liquor Operation Jiangsu Commerce 100.00% Establishment
province
Co.,Ltd. province
JSSJ Industry
Hong Kong, Hong Kong,
（HK） Holdings CORP 100.00% Establishment
China China
Co., Limited
Hubei Lihuacun Shiyan, Hubei Yunxian, Hubei
Commerce 100.00% Establishment
Trade Co.,Ltd. province province
Business
Jiangsu combinations
Sihong, Liquor
Shuanggou Sihong, Jiangsu involving
Jiangsu manufacture 99.99% 0.01%
Distillery Stock Co., province enterprises not
province and sales
Ltd. under common
control
Business
combinations
Sihong Shuanggou Sihong,
Sihong, Jiangsu Waste material involving
Antai Waste Jiangsu 100.00%
province recycle enterprises not
Recycling Co.,Ltd. province
under common
control
Business
Hubei Lihuacun Process liquor,
Shiyan, Hubei Yunxian, Hubei combinations
Liquor Industry wine and fruit 100.00%
province province involving
Co.,Ltd. wine
enterprises not
196
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
under common
control
Business
Manufacture combinations
Ningxiang Ningxiang,
Ningxiang, Hunan and sale of involving
Miluochun Liquor Hunan 100.00%
province liquor and enterprises not
Industry Co.,Ltd. province
compound wine under common
control
Business
combinations
Binxian, Binxian,
Harbin Binzhou involving
Heilongjiang Heilongjiang Liquor-making 100.00%
Brewery Co.,Ltd. enterprises not
province province
under common
control
Su Wine Group Assets/investme
Nanjing,
Jiangsu Wealth Nanjing, Jiangsu nt management,
Jiangsu 100.00% Establishment
Management province information
province
Co.,Ltd. consultation
Ningxiang Ningxiang,
Ningxiang, Hunan
Miluochun Trade Hunan Commerce 100.00% Establishment
province
Co.,Ltd. province
Biological
engineering
Jinagsu Kelite research,
Suqian,
Biology Technology Suqian, Jiangsu enzyme
Jiangsu 100.00% Establishment
Research Institute province preparation
province
Co.,Ltd. research and
technology
transfer
Xuzhou Huaqu Xuzhou,
Xuzhou, Jiangsu
Wine Development Jiangsu Commerce 100.00% Establishment
province
Co.,Ltd. province
Suqian,
Suqian Sky Blue Suqian, Jiangsu
Jiangsu Commerce 100.00% Establishment
Trade Co.,Ltd. province
province
Liquor,
Shiyan Yunyang compound wine,
Shiyan, Hubei Shiyan, Hubei
Lihuacun Package health wine 100.00% Establishment
province province
Service Co.,Ltd. packaging
service
Network
technology
development,
Jiangsu Lion and
Nanjing, technical
Sheep Network Nanjing, Jiangsu
Jiangsu consultation, 100.00% Establishment
Technology province
province technical
Co.,Ltd.
services;
Software
development
Business
combinations
Jiangsu Nanjing,
Nanjing, Jiangsu involving
Zhaiyougou E- Jiangsu Commerce 100.00%
province enterprises not
commerce Co.,Ltd province
under common
control
Business
Freight combinations
Nanjing Tongmeng Nanjing,
Nanjing, Jiangsu Transport, involving
City Logistics Jiangsu 99.99%
province Warehouse enterprises not
Co.,Ltd. province
service under common
control
Business
Freight combinations
Nanjing Jinling Nanjing,
Nanjing, Jiangsu Transport, involving
Tongmeng City Jiangsu 51.00%
province Warehouse enterprises not
Logistics Co.,Ltd. province
service under common
control
Nanjing Oubaosi Nanjing, Nanjing, Jiangsu Import and Business
100.00%
International Trade Jiangsu province export business combinations
197
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Co.,Ltd. province of self-run involving
goods, agency enterprises not
goods and under common
technology control
Business
Freight combinations
Huaian Tongmeng Huaian,
Huaian, Jiangsu Transport, involving
City Logistics Jiangsu 51.00%
province Warehouse enterprises not
Co.,Ltd. province
service under common
control
Business
Changzhou Freight combinations
Changzhou,
Jiezzhong Changzhou, Transport, involving
Jiangsu 51.00%
Tongmeng City Jiangsu province Warehouse enterprises not
province
Logistics Co.,Ltd. service under common
control
Business
Freight combinations
Nantong Nantong,
Nantong, Jiangsu Transport, involving
Tongmeng City Jiangsu 51.00%
province Warehouse enterprises not
Logistics Co.,Ltd. province
service under common
control
Business
Freight combinations
Suzhou Tongmeng Suzhou,
Suzhou, Jiangsu Transport, involving
City Logistics Jiangsu 51.00%
province Warehouse enterprises not
Co.,Ltd. province
service under common
control
Business
Freight combinations
Taizhou Tongmeng Taizhou,
Taizhou, Jiangsu Transport, involving
City Logistics Jiangsu 51.00%
province Warehouse enterprises not
Co.,Ltd. province
service under common
control
Business
Freight combinations
Wuxi Tongmeng
Wuxi, Jiangsu Wuxi, Jiangsu Transport, involving
City Logistics 51.00%
province province Warehouse enterprises not
Co.,Ltd.
service under common
control
Business
Freight combinations
Yancheng Yancheng,
Yancheng, Transport, involving
Tongmeng City Jiangsu 51.00%
Jiangsu province Warehouse enterprises not
Logistics Co.,Ltd. province
service under common
control
Business
Freight combinations
Zhenjiang Zhenjiang,
Zhenjiang, Transport, involving
Tongmeng City Jiangsu 51.00%
Jiangsu province Warehouse enterprises not
Logistics Co.,Ltd. province
service under common
control
Business
Freight combinations
Yangzhou Yangzhou,
Yangzhou, Transport, involving
Tongmeng City Jiangsu 53.00%
Jiangsu province Warehouse enterprises not
Logistics Co.,Ltd. province
service under common
control
Business
Freight combinations
Suqian Tongmeng Suqian,
Suqian, Jiangsu Transport, involving
City Logistics Jiangsu 51.00%
province Warehouse enterprises not
Co.,Ltd. province
service under common
control
Business
Freight
Pizhou Tongmeng Xuzhou, combinations
Xuzhou, Jiangsu Transport,
City Logistics Jiangsu 51.00% involving
province Warehouse
Co.,Ltd. province enterprises not
service
under common
198
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
control
Business
Lianyungang Freight combinations
Lianyungang,
Huaxing Tongmeng Lianyungang, Transport, involving
Jiangsu 51.00%
City Logistics Jiangsu province Warehouse enterprises not
province
Co.,Ltd. service under common
control
Business
combinations
Jiangsu Zhaibianli Nanjing,
Nanjing, Jiangsu involving
E-commerce Jiangsu Commerce 100.00%
province enterprises not
Co.,Ltd province
under common
control
Business
Hongkong combinations
Zhaiyougou Hong involving
Hong Kong,China Commerce 100.00%
International Trade Kong,China enterprises not
Co.,Ltd under common
control
Business
Liquor combinations
Guiyang,
Guizhou Guijiu Guiyang, Guizhou production; involving
Guizhou 100.00%
Co.,Ltd. province Liquor and enterprises not
province
alcohol sales under common
control
Guizhou Guijiu
Guiyang,
Liquor Operation Guiyang, Guizhou
Guizhou Commerce 100.00% Establishment
Management province
province
Co.,Ltd.
Guiyang,
Guizhou Guijiu Guiyang, Guizhou
Guizhou Commerce 100.00% Establishment
Trade Co.,Ltd. province
province
Guijiu series
Guiyang, liquor,
Guizhou Guijiu Guiyang, Guizhou
Guizhou compound wine, 100.00% Establishment
Package Co.,Ltd. province
province health care wine
packaging
Jinagsu Guanmeng
Suzhou, Information
Information Suzhou, Jiangsu
Jiangsu technology 100.00% Establishment
Technology province
province development
Co.,Ltd.
Business
combinations
ZYG E-Commerce Hong Industrial involving
Hong Kong,China 100.00%
HK Limited Kong,China investment enterprises not
under common
control
Business
combinations
Cayman Industrial involving
ZYG LTD Cayman Islands 69.08%
Islands investment enterprises not
under common
control
YangHe
British Virgin British Virgin Industrial
International 100.00% Establishment
Islands Islands investment
Investment Ltd
Jiangsu Healthy wine,
Shuanggou Suqian, nutrition and
Suqian, Jiangsu
Healthy Liquor Jiangsu health food 100.00% Establishment
province
Research institute province research and
Co.,Ltd. development
Business
combinations
ZYG Technology British Virgin British Virgin Industrial involving
71.03%
Investment Ltd Islands Islands investment enterprises not
under common
control
Jiangsu Blue Suqian, Suqian, Jiangsu
Commerce 100.00% Establishment
Dream E- Jiangsu province
199
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
commerce Co.,Ltd. province
Network
Jiangsu Yanghe technology
Nanjing,
Weiketang Network Nanjing, Jiangsu development,
Jiangsu 100.00% Establishment
Technology province technical
province
Co.,Ltd. consultation,
technical servic
Business
combinations
Guizhou Welcome Renhuai, Liquor
Renhuai, Guizhou involving
Drink Stock Co., Guizhou manufacture 100.00%
province enterprises not
Ltd. province and sales
under common
control
Business
Dream Blue Industrial combinations
Chuanhaihui Shiyan, Hubei Shiyan, Hubei investment, involving
100.00%
(Shiyan) Trade province province Online business enterprises not
Investment Co.,Ltd. consultation under common
control
Road general
Suqian, cargo transport,
Suqian Su Wine Suqian, Jiangsu
Jiangsu cargo 100.00% Establishment
Logistics Co.,Ltd. province
province distribution,
freight forwarder
Movable and
real estate
investment
Yanghe Chile SPA Santiago,
Santiago, Chile services, 100.00% Establishment
Chile
building
construction
services
Foreign
Jiangsu Yanghe investment,
Suqian,
Investment Suqian, Jiangsu Asset
Jiangsu 50.00% 50.00% Establishment
Management province management,
province
Co.,Ltd. Investment
consulting
Enterprise
management
consulting;
Su Wine Group
Nanjing, Industrial
Nanjing Operation Nanjing, Jiangsu
Jiangsu investment; 100.00% Establishment
Management province
province Food sales; Gift
Co.,Ltd.
sales; House
lease; Hotel
management
Nanjing,
Jiangsu Zhongshiji Nanjing, Jiangsu Food sales, Gift
Jiangsu 100.00% Establishment
liquor Co.,Ltd. province sales
province
Yanghe Hong Kong Hong Industrial invest
Hong Kong,China 100.00% Establishment
Distillery Co., Ltd. Kong,China ment
The shareholding ratio in the subsidiary is different from the voting ratio:
The basis for holding half or less of the voting rights but still controlling the invested entity,
and for holding more than half of the voting rights but not controlling the invested entity:
For important structural subjects included in the scope of merging, the basis of control:
Basis for determining whether the company is an agent or a principal:
Other statements:
2. Interests in associates and a joint venture
(1) The impact of the Group’s associates on the Group is not significant.
Summarized information is as follows:
Unit: CNY
Closing balance/amount in Opening balance/amount in
current period previous period
200
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Associates: -- --
Aggregated carrying amount of
10,521,622.18
investments
Aggregate of the following items
-- --
calculated in proportion to shareholding
--Net profit -6,220,574.92
-- Other comprehensive income 178,619.29
-- Total comprehensive income -6,041,955.63
Joint ventures: -- --
Aggregated carrying amount of
14,840,029.20 9,423,328.82
investments
Aggregate of the following items
-- --
calculated in proportion to shareholding
--Net profit 1,773,286.58 1,819,591.30
-- Total comprehensive income 1,773,286.58 1,819,591.30
X. Risks related to financial instruments
The Group is exposed to various financial risks in the ordinary course of business, mainly
including: credit risk, liquidity risk, market risk, etc. The Company's management is fully
responsible for the formulation of risk management objectives and policies, and takes
responsibility for risk management objectives and policies. The objective of the
Company’s risk management is to identify and analysis risk, minimizing the adverse
impact of financial risks without excessive influence on the company's competitiveness
and resilience.
1. Credit risks
Credit risk refers to the risk that one party of the financial instruments fails to perform its
obligations and causes the financial losses of the other party. Credit risk mainly related to
notes receivables and accounts receivable, in order to control the risk, the Company
takes the following measures:
(1)Bank deposit
The company's bank deposits are mainly deposited in state-owned holding Banks, large
and medium-sized listed Banks and other commercial banks with high credit. There is no
significant credit risk and no significant loss caused by default.
(2)Notes receivables and accounts receivables
The Company mainly trades with dealers, according to company credit policy,and adopts
the way of delivery after the payments finished. For some group purchase business, it
only deals with the reputable group clients, and continuously monitors the balance of
notes receivables and accounts receivables, as a result, there is no collateral required,
and credit risk management concentrates on the clients. The balance of notes
receivables and accounts receivables are small till 31 December 2019. The Company
does not hold any collateral or other credit enhancement for the balance of accounts
receivables.
(3) Other receivable
The other receivables are mainly saving deposits involving infringement dispute, deposits
and petty cash, employee business loan and so on. The Company manages other
receivables and continuously monitors its balance, to ensure the Company not to face
significant bad debt risks.
201
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
2. Liquidity risk
Liquidity risk refers to the risk of capital shortage when enterprise performs its obligations
related to financial liabilities. The Company uses various financing methods such as bill
clearing and bank loan to optimize the financing structure and maintain the balance
between financing continuity and flexibility.
The maturity of the financial liabilities held by the Company according to the
undiscounted remaining contractual obligations is analyzed as follows:
Item Closing balance
Within 1 year 1-2 years 2-3 years Over 3 years Total
Account
1,330,649,116.82 1,330,649,116.82
payables
Other payables 6,521,146,762.07 6,521,146,762.07
Long-term loan 72,723.00 72,723.00
Long-term
197,623,728.85 197,623,728.85
payables
(Continued)
Item Opening balance
Within 1 year 1-2 years 2-3 years Over 3 years Total
Account
1,261,282,397.89 1,261,282,397.89
payables
Other payables 6,457,301,511.01 6,457,301,511.01
Long-term loan 109,088.00 109,088.00
Long-term
198,404,248.85 198,404,248.85
payables
3. Market risk
Market risk is the fair value of financial instrument or future cash flow fluctuates due to
the fluctuation of market price, and it mainly includes: interest rate risk, foreign exchange
risk, etc.
(1) Interest rate risk
Interest rate risk refers to the fair value of financial instrument or future cash flow
fluctuates due to the fluctuation of interest rate. The Company faces the risk of market
interest rate change mainly related to the Company's borrowing limit.
(2) Foreign exchange risk
Foreign exchange risk arises from fluctuation in exchange rate, relevant to the assets
and liabilities in foreign currency. The less import and export business happened, the
lower impact of exchange rate fluctuation on company's operation.
The amount in CNY of the Company’s assets and liabilities shown in foreign currencies
as follows:
Item Closing balance Opening balance
Balance in Balance in
Exchange Balance in Exchange
foreign foreign Balance in CNY
rate CNY rate
currency currency
Cash and
202
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
cash
equivalents
5,851,102.50 6.9762 40,818,461.2 5,234,261.55 6.8632 35,923,783.86
Include: USD
6
HKD 2,267,649.63 0.89578 2,031,315.19 1,153,729.70 0.8762 1,010,897.96
CLP 2,259,388,389 0.0092599 20,921,642.7 1,356,097,790. 0.0098436 13,348,876.41
.00 6 00
Other
receivables
Include: USD
HKD 472,381.42 0.89578 423,149.83 273,999.76 0.8762 240,078.59
Account
payables
Include: USD 494,265.45 6.8632 3,392,242.64
CLP 6,139,589.00 0.009844 60,435.62
Other
payables
Include: HKD 1,465,427.84 0.89578 1,312,700.95 3,430,385.91 0.8762 3,005,704.13
CLP 14,000.00 0.0092599 129.64 168,352.00 0.009844 1,657.19
62,881,738.4 44,063,597.24
Net amount
5
The amount of foreign currency financial assets and financial liabilities of the company is
small. Exchange rate fluctuations have little impact on the Company's operating
performance.
XI.Fair value disclosure
1.Fair value of assets and liabilities measured at fair value as
at the end of the period
Unit: CNY
Closing fair value
Item Within Level 1 of Within Level 2 of Within Level 3 of
the fair value the fair value the fair value Total
hierarchy hierarchy hierarchy
Disclosure of
continuous
-- -- -- --
measurement at fair
value
(1)Debt instrument
19,671,745,366.98 19,671,745,366.98
investment
(2)Equity instrument
331,714,847.11 3,024,158,666.52 3,355,873,513.63
investment
Disclosure of
discontinuous
-- -- -- --
measurement at fair
value
2.Determination basis of the market value of items measured
continuously and discontinuously within Level 1 of the fair value
hierarchy
Item Fair value Active market quote
203
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Transaction price Sources
Continuous measurement at fair value
(1) Financial assets held for trading
Local open market
Equity instrument investment 331,714,847.11 331,714,847.11
closing price
Total amount of assets measured at fair
331,714,847.11 331,714,847.11
value continuously
3.Items measured continuously and discontinuously within Level 3 of
the fair value hierarchy, valuation technique adopted and quantitative
and qualitative information of important parameters
Item Fair value Valuation technique
Continuous measurement at fair
value
Financial assets held for trading
The expected rate of return as an
Debt instrument investment 19,671,745,366.98 important reference to evaluate its fair
value
The investment cost or the net assets
of the invested entity at the end of the
Equity instrument investment 3,024,158,666.52
period are used as an important
reference to evaluate its fair value
Total amount of assets measured at
22,695,904,033.50
fair value continuously
XII. Related parties and related party transactions
1. The parent company of the Company
Voting
Name of parent Registered Shareholding Ratio by
Registration place Business nature ratio by the
company capital the parent
parent company
company
Sales of brewing
machinery
equipment, export
of liquor, import of
various raw and
Jiangsu Yanghe auxiliary materials, CNY 110.00
Suqian, Jiangsu 34.16% 34.16%
Group Co.,Ltd. equipment and million
accessories
required for
production,
industrial
investment.
Information about the Company’s parent company
The final control party of the Company is State-owned Assets Supervision and
Administration Commission of Suqian.
Other statements:
2. Subsidiaries of the Company:
The information about the subsidiaries of the Company refers to Note IX.1 Interests in
Subsidiaries.
3. Joint venture and associate of the Company
204
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
The information about the joint venture and associate of the Company refers to the Notes.
Other joint ventures and associates whose related party transactions with the Company
in the current period or balance formed from related party transactions with the Company
in the prior period as follows:
Name of joint venture and associate Relationship with the Company
Diageo International Spirits Company Limited Joint Venture
Jiangsu Su Wine Cultural Transmission Co.,Ltd. Associate
Nanjing Hesong Culture Technology Co.,Ltd. Associate
Jiangsu Xinghe Investment Management Co.,Ltd. Associate
Other statements:
4. Other related party
Name of other related party Relationship with the Company
Shanghai Haiyan Logistics Development Co.,Ltd. Holding 9.67% shares
Suning Consumption Finance Co.,Ltd. Joint stock company, holding 5% shares
Joint stock company, holding 12.50%
VSPT, Via San Pedro Tarapacá S.A.
shares
Controlled by Diageo International Spirits
Jiangsu Diageo Wine Co. LTD
Company Limited, joint venture of Company
5. Related party transactions
(1) Related transactions of purchase of goods / supply and receipt of labor
services
Table of purchase of goods / Receipt of labor services
Unit: CNY
Approved Whether it is
Transaction Amount in Amount in
Related Party transaction over transaction
Content current period previous period
amount amount or not
VSPT, Via San
Pedro Tarapacá Red wine 22,491,676.84 No 23,075,164.23
S.A
Nanjing Hesong No
Advertising and
Culture
general publicity 26,877,500.00 21,460,376.65
Technology
expense
Co.,Ltd.
Jiangsu Diageo No
Liquor 9,426,504.96
Wine Co. LTD
Table of sales of goods/ rendering of labor services
Unit: CNY
Amount in current Amount in previous
Related party Transaction content
period period
Shanghai Haiyan Logistics
Sales of liquor 21,940,314.79 24,698,678.39
Development Co.,Ltd.
Jiangsu Su Wine Cultural
Sales of liquor 27,033,928.43 34,464,141.85
Transmission Co.,Ltd.
Jiangsu Diageo Wine Co. Ltd Sales of liquor 11,451,243.61
Nanjing Hesong Culture
Consulting fee income 165,048.55
Technology Co.,Ltd.
Description of related transactions in the purchase and sale of goods, provision and
receipt of services
205
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
(2) Other related party transactions
Jiangsu Yanghe Investment Management Co., Ltd., a holding subsidiary, recovered CNY
30,000.00 of time deposit from Suning Consumer Finance Co., Ltd., and charged CNY
9,497,222.22 of deposit interest.
6. Receivables and payables of related parties
(1) Receivables
Unit: CNY
Closing balance Opening balance
Item Related party Provision for bad Provision for bad
Book balance Book balance
debt debt
Jiangsu Diageo
Receivables 8,231,298.10 246,938.94
Wine Co. Ltd
(2)Payables
Unit: CNY
Closing Opening
Item Related party
balance balance
Shanghai Haiyan Logistics Development
Advance from customer 3,455,154.28 8,427,121.32
Co.,Ltd.
Advance from customer Jiangsu Su Wine Cultural Transmission Co.,Ltd. 7,998,800.00 4,541,664.83
Shanghai Haiyan Logistics Development
Other Payables 83,709.60 801,624.00
Co.,Ltd.
Other Payables Jiangsu Su Wine Cultural Transmission Co.,Ltd. 900,000.00 933,060.00
XIII. Commitments and contingencies
1. Significant commitments
Significant commitments existing on the balance sheet date
By the end of 31 December 2019, there were no significant commitments needed to be
disclosed.
2. Contingencies
(1)Significant contingencies at the balance sheet date:
Regarding the tort liability dispute case of ICBC Zhengzhou Jiefang Road Branch, Su
Wine Group Trade Co., Ltd. applied for a claim, requesting the defendant to jointly and
severally compensate the plaintiff with CNY 46,025,000.00 of principal and interest loss
during the deposit period (The interest loss is based on CNY 103,250,000.00 and it is
calculated from 21 May 2014 according to the loan interest rate of the People's Bank of
China in the same period and the same file. Among those, CNY 18,257,000.00 is
calculated till 8 September 2017, CNY 38,968,000.00 is calculated till 13 December 2017,
and CNY 46,025,000.00 is calculated till the actual date of payment).
According to the Civil Judgment of Suqian Intermediate People's Court of Jiangsu
Province, the defendant was liable for compensation of 70% of the total loss, and the
defendant was ordered to pay the plaintiff Su Wine Group Trade Co., Ltd. loss of interest
(the calculation method of interest: the interest rate standard is calculated according to
the one-year fixed deposit interest rate on the day of 21 May 2013 of the Industrial and
Commercial Bank of China Zhengzhou Jiefang Road Branch, where CNY 90 million is
the principal from 21 May 2013 to 7 September 2017; CNY 71.7433 million is calculated
from 8 September 2017 to 12 December 2017; CNY 32.7775 million is calculated from 13
December 2017 to the date of actual payment. The sum of the interest calculated above
is multiplied by 70%.)
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Su Wine Group Trade Co., Ltd. dissatisfied with the above judgment and has appealed to
the Jiangsu Provincial Higher People's Court. On 25 July 2019, Jiangsu Provincial Higher
People's Court (2019) Su Min Zhong No. 1157 "Notice of Acceptance of the Case" was
received. The case is in the process..
Except for the above event, by the end of 31 December 2019, the Company had no other
significant contingencies required to be disclosed.
(2)If no contingencies that need to be disclosed, statement should be made.
The Company has no material contingencies to disclose.
XIV. Post balance sheet event
1.The distribution of profits
Unit: CNY
Profits or dividends planed to be distributed 4,502,987,691.00
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
XV. Notes to main items of parent company financial statements
1. Accounts receivable
(1) Disclosure of accounts receivable by categories
Unit: CNY
Closing balance Opening balance
Book balance Provision for bad debt Book balance Provision for bad debt
Type
Proportion Book value Proportion Book value
Amount Proportion Amount Amount Proportion Amount
of provision of provision
Including:
Provision for bad debts
900,499,168.05 100.00% 246,938.94 0.03% 900,252,229.11 697,277,202.71 100.00% 697,277,202.71
by portfolio
Including:
Risk portfolio 8,231,298.10 0.91% 246,938.94 3.00% 7,984,359.16
Nature portfolio 892,267,869.95 99.09% 892,267,869.95 697,277,202.71 100.00% 697,277,202.71
Total 900,499,168.05 100.00% 246,938.94 0.03% 900,252,229.11 697,277,202.71 100.00% 697,277,202.71
Provision for bad debts by individual
Unit: CNY
Closing balance
Name of client
Book balance Provision for bad debts Proportion Reason
Provision for bad debts by portfolio：246,938.94
Unit: CNY
Closing balance
Name of portfolio
Accounts receivables Provision for bad debt Proportion
Risk portfolio 8,231,298.10 246,938.94 3.00%
Total 8,231,298.10 246,938.94 --
Notes to determine provision for bad debt by portfolio:
Provision for bad debts by portfolio：
Unit: CNY
Name of portfolio Closing balance
208
2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Accounts receivables Provision for bad debt Proportion
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Notes to determine provision for bad debt by portfolio:
If the Company uses the accounts receivable provision for bad debts according to the
general model of expected credit loss, please disclose the relevant information of
provision for bad debt by referring to the disclosure method of other receivables：
Applicable √ N/A
Analysis by aging
Unit: CNY
Aging Closing balance
Within 1 year (including 1 year) 900,499,168.05
Total 900,499,168.05
(2)Provision for bad debts that is accrued, recovered or reversed during this period
Provision for bad debts during current period
Unit: CNY
Changes in the current period
Opening Closing
Category Recovered or
balance Provision Write off Others balance
reversed
Provision for
bad debt for
246,938.94 246,938.94
Accounts
receivables
Total 246,938.94 246,938.94
Significant amount of reversal or recovery in current period:
Unit: CNY
Company name Amount recovered or reversed Ways of recovery
(3)Top five entities with the largest balances of the accounts receivables
Unit: CNY
Proportion in the total
Company’s name Closing balance Provision amount
accounts’ receivables (%)
Jiangsu Yanghe Liquor
Operation Management 640,740,847.81 71.15%
Co.,Ltd
Jiangsu Shuanggou Liquor
118,240,639.81 13.13%
Co.,Ltd
Hubei Lihuacun Liquor
99,724,012.12 11.07%
Industry Co.,Ltd.
Siyang Lantu Liquor
30,783,590.93 3.42%
Operation Co.,Ltd.
Jiangsu Diageo Wine Co. Ltd 8,231,298.10 0.91% 246,938.94
Total 897,720,388.77 99.68%
2.Other receivables
Unit: CNY
Item Closing balance Opening balance
Dividend receivable 713,143.77
Other receivables 8,154,899,373.55 949,642,201.21
Total 8,154,899,373.55 950,355,344.98
(1) Other receivables
1) Disclosure of other receivable by categories
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Unit: CNY
Nature of other receivables Closing balance Opening balance
Within the scope of consolidation the
8,153,014,458.45 944,080,654.19
subsidiary borrows
Cash deposit 15,020,000.00 15,807,031.24
Business loans and petty cash 3,429,429.04 3,953,955.18
Other receivables 3,038,490.82 1,189,201.13
Total 8,174,502,378.31 965,030,841.74
2) Provision for bad debt
Unit: CNY
Phase 1 Phase 2 Phase 3
Expected credit
Bad debts Expected credit Expected credit loss Total
loss for lifetime
losses in the next for lifetime (No credit
(Credit loss
12 months loss occurred)
occurred)
Balance as at 1
161,933.81 15,226,706.72 15,388,640.53
January 2019
Change of opening
balance as at 1
—— —— —— ——
January 2019 in
current period
-- Return to phase 3 -44,464.94 44,464.94
Provision in 2019 3,298,423.46 3,298,423.46
Reverse in 2019 49,914.58 49,914.58
Other changes 108.15 965,747.20 965,855.35
Balance as at 31
67,662.44 19,535,342.32 19,603,004.76
December 2019
Significant change of the book balance of provision during the period
Applicable √ N/A
Other receivables by aging
Unit: CNY
Aging Closing balance
Within 1 year(including 1 year) 8,149,352,133.73
1-2 years 1,944,798.29
2-3 years 2,278,210.22
Over 3 years 20,927,236.07
3-4 years 150,376.89
4-5 years 1,377,525.00
Over 5 years 19,399,334.18
Total 8,174,502,378.31
3) Provision, recovery or reversal for bad debt during this period
Provision for bad debt during this period：
Unit: CNY
Changes in the current period
Opening
Category Recovered or Other Closing balance
balance Provision Write off
reversed changes
Provision for
other
15,388,640.53 3,298,423.46 49,914.58 965,855.35 19,603,004.76
receivables bad
debt
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Total 15,388,640.53 3,298,423.46 49,914.58 965,855.35 19,603,004.76
Significant amount of reversal or recovery during this period:
Unit: CNY
Company name recovery or reversal Way of recovery
(4) Top five entities with the largest balances of the other receivables
Unit: CNY
Provisioning
Proportion in total
Company’s Name Category Closing balance Aging amount at
receivables
period end
Jiangsu Yanghe With in 1 year
Investment 8,015,094,136.5
Loan 98.05%
Management Co., 9
Ltd.
Guizhou Guijiu With in 1 year
Loan 85,648,130.32 1.05%
Co.,Ltd.
Hubei Lihuacun With in 1 year
Liquor Industry Loan 25,450,000.00 0.31%
Co,Ltd.
Jiangsu Juntai
Properties Co.,Lt.,
Suqian Guotai
Department Store deposit 15,000,000.00 Over 5 years 0.18% 15,000,000.00
Co.,Ltd. bankruptcy
administrator
deposit
8,830,000.00 with
in 1 year,
848,000.00 in 1 to
Harbin Binzhou 2 years,
Loans 13,717,100.00 0.17%
Brewery Co.,Ltd. 290,000.00 in 2 to
3 years,
3,749,100.00 over
3 years
8,154,909,366.9
Total -- -- 99.76% 15,000,000.00
1
3. Long-term equity investments
Unit: CNY
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Investment in 7,964,291,378 7,964,291,378. 7,365,139,18 7,365,139,1
subsidiaries .23 23 0.24 80.24
7,964,291,378 7,964,291,378. 7,365,139,18 7,365,139,1
Total
.23 23 0.24 80.24
(1) Investment in subsidiaries
Unit: CNY
Increase in the current period Closing
Provision balance of
Opening Closing
Investee for provision
balance Increase Decrease Others balance
impairme for
nt impairment
Jiangsu Yanghe 153,109,422.3 153,109,422.
Package 9 39
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Co.,Ltd.
Suqian Yanghe
Guibinguan 700,000.00 700,000.00
Co.,Ltd.
Jiangsu
Shuanggou 1,713,152,320 1,713,152,32
Distillery Stock .00 0.00
Co.,Ltd.
Su Wine Trade 285,225,078.2 285,225,078.
Group Co.,Ltd. 3 23
Jiangsu Yanghe
Liquor Operation 10,983,280.0
10,983,280.00
Managment 0
Co.,Ltd
Jiangsu Dongdi
Union
5,000,000.00 5,000,000.00
International
Trade Co.,Ltd.
Jiangsu
Dongdixinghui
5,000,000.00 5,000,000.00
International
Trade Co.,Ltd
Siyang Lantu
Liquor Operation 3,161,700.00 3,161,700.00
Co.,Ltd.
Hubei Lihuacun
Liquor Industry 3,000,000.00 3,000,000.00
Co.,Ltd.
Ningxiang
Miluochun
2,129,000.00 2,129,000.00
Liquor Industry
Co.,Ltd.
Harbin Binzhou
2,000,000.00 2,000,000.00
Brewery Co.,Ltd.
Su Wine Group
Jiangsu Wealth 3,000,000,000 3,000,000,00
Management .00 0.00
Co.,Ltd.
Jinagsu Kelite
Biology
10,000,000.0
Technology 10,000,000.00
0
Research
Institute Co.,Ltd.
Jiangsu Lion and
Sheep Network
5,460,000.00 5,460,000.00
Technology
Co.,Ltd.
Guizhou Guijiu 193,300,000.0 750,000, 943,300,000.
Co.,Ltd. 0 000.00 00
Jiangsu Yanghe
Weiketang
Network 300,000.00 300,000.00
Technology
Co.,Ltd.
Dream Blue
15,738,379.6
Haichuanhui 15,738,379.62
2
(Shiyan) Trade
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Investment
Co.,Ltd.
Yanghe Chile 456,880,000.0 456,880,000.
SPA 0 00
Jiangsu Yanghe
Investment 1,500,000,000 1,500,000,00
Management .00 0.00
Co., Ltd.
Yanghe Hong
18,000,0 18,000,000.0
Kong Liquor Co.,
00.00 0
Ltd.
7,365,139,180 768,000, 168,847,802. 7,964,291,37
Total
.24 000.00 01 8.23
4. Operating revenue and cost of sales
Unit: CNY
Current period Previous period
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Primary business 8,802,985,205.67 4,522,356,318.57 8,929,113,755.67 4,329,862,499.55
Other business 814,151,123.47 778,500,563.64 790,965,922.15 733,774,470.86
Total 9,617,136,329.14 5,300,856,882.21 9,720,079,677.82 5,063,636,970.41
Does the company need to comply with the disclosure requirements of revenue.
No
Other statements:
5. Investment income
Unit: CNY
Item Current period Previous period
Investment income from long-term equity
6,416,968,211.24 6,099,622,529.13
investments under the equity method
Investment income from disposing long-
27,117,336.74
term equity investments
Investment income from financial assets
6,946,070.62
held for trading during the holding period
Investment income from disposal of
407,441,556.04
financial assets held for trading
Investment income from available-for-
sale financial assets during the holding 16,371,813.72
period
Investment income from disposal of
56,995,537.28
available-for-sale financial assets
Other investment income 546,760,832.64
Total 6,858,473,174.64 6,719,750,712.77
XVI. Supplementary information
1. Detailed statement of non-recurring profits and losses
Applicable √ N/A
Unit: CNY
Item Amount Notes
Profit or loss from disposal of non-
13,797,266.00
current assets
Government grants accounted for, in the
profit or loss for the current period 85,605,383.19
(except for the government grants
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
closely related to the business of the
Company and given at a fixed amount or
quantity in accordance with the state's
uniform standards)
In addition to the effective hedging
business related to the company's
normal business operations, changes in
fair value from holding financial assets
held for trading, derivative financial
assets, financial liabilities held for
trading, fair value changes, and 973,456,912.43
investment income from disposal of
financial assets held for trading and
derivative financial assets, financial
liabilities held for trading, derivative
financial liabilities and other debt
investments
Other non-operating income and
expenditure except above-mentioned 12,845,147.02
items
Other profit and loss items that conform
to the definition of non-recurring profits 1,670,388.78
and losses
Less: Effect of income tax 260,122,467.95
Effect of minority equity 319,932.41
Total 826,932,697.06 --
Statement for extraordinary gain and loss items that the Company defines according to
the definition in “Explanatory Announcement of Information Disclosure of Company that
Issues Securities publicly No.1- Extraordinary Gain and Loss” and definition of recurrent
gain and loss items that are listed as extraordinary gain and loss in the “Explanatory
Announcement of Information Disclosure of Company that Issues Securities publicly
NO.1- Extraordinary Gain and Loss”:
Applicable √ N/A
2. Return on equity and earnings per share
EPS(CNY/Share)
Profit during reporting period Weighted average ROE
Basic EPS Diluted EPS
Net profits attributable to
ordinary shareholders of the 21.21% 4.8991 4.8991
Company
Net profits attributable to
ordinary shareholders of the
18.83% 4.3503 4.3503
Company after deduction of
extraordinary gain and loss
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2019 Annual Report of Jiangsu Yanghe Brewery Joint-Stock Co., Ltd.
Section XIII Documents Available for Preference
1. Financial statements signed and stamped by the legal representative, the person in
charge of accounting affairs and the person in charge of accounting department;
2. The original of the auditor’s report with the seal of the accounting firm, and signed and
stamped by CPAs;
3. The originals of all company documents and announcements that are disclosed to the
public via media designated by CSRC during the reporting period;
4. The original of 2019 annual report signed by chairman.
216
