SHENZHEN CHINA BICYCLE COMPANY (HOLDINGS)
LIMITED
Semi-Annual Report 2011
Important Notice
The directors, supervisors and senior executives of Shenzhen China Bicycle Company (Holdings)
Limited (hereinafter referred to as the Company) hereby confirm that there are no important
omissions, fictitious statements or serious misleading information carried in this report, and shall
take all responsibilities, individually and jointly, for the authenticity, accuracy and completeness of
the whole contents.
The 2011 semi-annual financial report of the Company has not been audited, and the investors are
suggested to read carefully.
No director declares that he or she could not assure the authenticity, accuracy and completeness of
the semi-annual report, or holds different opinions.
Independent Director—Ms. Li Bing absent the Board of Directors Meeting due to working, and
Director—Ms. Zhang Xinmiao was authorized for attending the Meeting and exercise right of
voting.
Person in Charge of the Company Mr. Luo Guiyou, Person in Charge of Accounting Works Mr.
Zhang Zebing and Person in Charge of Accounting Institution Mr. Sun Longlong hereby assure that
the financial report enclosed in the semi-annual report is true and complete.
CONTENTS
Section I. Company Profile…………………………………… 3
Section II. Main Financial Data and Business Indexes………………………… 4
Section III. Changes in Share Capital and Particulars about Shareholders…… 6
Section IV. Particulars about Directors, Supervisors and Senior Executives… 10
Section V. Report of the Board……………………………………… 11
Section VI. Significant Events…………………………………………………… 17
Section VII. Financial Report…………………………… 22
Section VIII. Documents Available for Reference………………………………… 22
Section I. Company Profile
(I). Legal Name of the Company
In Chinese: 深圳中华自行车（集团）股份有限公司
In English: SHENZHEN CHINA BICYCLE COMPANY（HOLDINGS）LIMITED
Short form of English Name: CBC
(II). Legal Representative: Luo Guiyou
(III). Secretary of the Board: Yao Zhengwang
Representative of Securities Affairs: Cui Hongxia
Tel.: 0755-28181666
Contact Address: Zhonghua Industrial Park, Yousong Industrial Zone, Longhua, Shenzhen,
Guangdong Province, China
Fax: 0755-28181009
E-mail: dmc@szcbc.com
(IV). Registered Address: No. 3008, Buxin Road, Shenzhen, Guangdong Province, China
Postcode: 518019
Office Address: Zhonghua Industrial Park, Yousong Industrial Zone, Longhua, Shenzhen,
Guangdong Province, China
Postcode: 518131
Internet Website: www.cbc.com.cn
E-mail: cbc@szcbc.com
(V).Newspapers Chosen for Disclosing Information: Securities Times and Hong Kong Commercial
Daily
Internet Website Designated for Publishing the Semi-annual Report: http://www.cninfo.com.cn
Place Where the Semi-annual Report Is Prepared and Placed: Secretariat of the Board of the
Company, Yousong Industrial Zone, Longhua, Shenzhen
(VI). Stock Exchange Listed with, Short Form of the Stock and Stock Code:
Stock Exchange Listed with: Shenzhen Stock Exchange
Short Form of the Stock: *ST ZHONGHUA - A, *ST ZHONGHUA - B
Stock Code: 000017/A-stock, 200017/B-stock
VII. Other Relevant Information:
1. Date of the First Registration: August 24, 1984
2. Place: Buxin Road, Shenzhen
3. Registration No. of the Business License of Incorporated Enterprise: 440301501122085
4. Tax Registration No.: GSSZ No. 440301618830452, SDSDZ No. 440303618830452
5. Name and office address of the Certified Public Accountants engaged by the Company:
Name: Shenzhen Pengcheng Certified Public Accountants Co., Ltd.
Office Address: 7/F, Block A, No. 5022 Union Square, Binhe Road, Futian District, Shenzhen
Section II. Main Financial Data and Business Indexes
(I). Main accounting data and financial indexes
1. Major accounting data
Unit: RMB
Increase/decrease at
the end of this report
At the end of this At the period-end
period compared with
report period of last year
that in period-end of
last year (%)
Total assets 150,424,997.29 138,158,078.89 8.88
Owners’ equity attributable to
-1,712,943,370.52 -1,756,185,442.87 -2.46
shareholders of the listed company
Share capital 551,347,947.00 551,347,947.00 0.00
Net assets per share attributable to
shareholders of the listed
company(RMB/Share)
Increase/decrease in
This report period The same period
this report period
(Jan. to Jun.) of last year year-on-year (%)
Total operating income 136,537,595.25 120,622,786.14 13.19
Operating profit -21,589,373.90 -52,431,969.81 -58.82
Total profit 26,213,055.39 -51,663,487.04 -150.74
Net profit attributable to shareholders of
26,213,055.39 -51,719,360.41 -150.68
the listed company
Net profit attributable to shareholders of
the listed company after deducting -21,589,373.90 -52,487,843.18 -58.87
non-recurring gains and losses
Basic earnings per share (RMB/Share) 0.0475 -0.0938 -150.68
Diluted earnings per share (RMB/Share) 0.0475 -0.0938 -150.68
Return on equity (%) - - -
Net cash flow arising from operating
1,314,073.56 5,750,731.94 -77.15
activities
Net cash flow per share arising from
0.0024 0.0104 -77.15
operating activities (RMB/Share)
2. Items of non-recurring gains and losses:
Unit: RMB
Non-recurring gains and losses Amount Note(If applicable)
Other non-operating income and expense
47,802,429.29
excluded the aforementioned business
Total 47,802,429.29 -
(II). Indexes calculated in accordance with Regulations on the Information Disclosure of
Companies Publicly Issuing Shares (No. 9) are as follows:
Return on equity (%) Earnings per share (RMB)
Profit index Fully Weighted Fully
Weighted average
diluted average diluted
Operating profit - - -0.0392 -0.0392
Net profit - - 0.0475 0.0475
Net profit after deducting - - -0.0392 -0.0392
non-recurring gains and losses
(III). There are no differences in net assets calculated in accordance with CAS and IAS respectively
in the report period.
Section III. Changes in Share Capital and Particulars about Shareholders
(I) Changes in share capital:
No change occurred on total share capital in this report period
Unit: share
Before the Increase/Decrease of this time (+, -)
After the change
change
Ne
Capitali
w Bo
zation
Amoun Propo sha nus
of Others Subtotal Amount Proportion
t rtion res sha
public
iss res
reserve
ued
I.
186,722, 33.87 -77,507, -77,507,90 109,214,2
Restricte 139 % 909 9 30
19.81%
d shares
1.
State-ow
0 0.00% 0 0
ned
shares
2.
State-ow
16,340,0 -16,340, -16,340,00
ned legal 00
2.96%
000 0
0 0
person’s
shares
3. Other
95,267,0 17.28 -30,168, -30,168,59 65,098,41
domestic 02 % 590 0 2
11.81%
shares
Including
:
Domestic
non-state- 88,767,0 16.10 -23,668, -23,668,59 65,098,41
11.81%
owned 02 % 590 0 2
legal
person’s
shares
Domestic
natural 6,500,00 -6,500,0
1.18% -6,500,000 0.00% 0.00%
person’s 0 00
shares
4.
75,106,1 13.62 -31,001, -31,001,94 44,104,24
Foreign 90 % 944 4 6
8.00%
shares
Including
75,106,1 13.62 -31,001, -31,001,94 44,104,24
: Foreign 90 % 944 4 6
8.00%
legal
person’s
shares
Foreign
natural
0 0.00%
person’s
shares
5. Senior
executive 8,947 0.00% 2,625 2,625 11,572 0.00%
s’ shares
II.
364,625, 66.13 77,507, 442,133,7
Unrestrict 808 % 909
77,507,909
17
80.19%
ed shares
1. RMB
116,262, 21.09 77,510, 193,773,3
Ordinary 826 % 534
77,510,534
60
35.15%
shares
2.
Domestic
248,362, 45.05 248,360,3
ally listed 982 %
-2,625 -2,625
57
45.05%
foreign
shares
3.
Overseas
listed 0 0.00% 0 0.00%
foreign
shares
4. Others 0 0.00% 0 0.00%
III. Total 551,347, 100.00 551,347,9
0 0 100.00%
shares 947 % 47
(II) Particulars about shares held by the top ten shareholders and the top ten shareholders with unrestricted conditions
Unit: Share
Total shareholders 34,924
Particulars about shares held by the top ten shareholders
Proporti
Total Amount of Shares
Nature of on of
Full name of shareholders amount of restricted pledged or
shareholders shares
shares held shares held frozen
held
Domestic
Shenzhen Guocheng Energy
non-state-owne 11.81% 65,098,412 65,098,412 0
Investment Development Co., Ltd.
d legal person
Hong Kong Zhuorun Technology Foreign legal 8.00% 44,104,246 44,104,246 30,000,000
Co., Ltd. person
China Bicycle Company (Holdings) Foreign legal 4.72% 26,000,000 0 26,000,000
Limited person
Domestic
Shenzhen Kangsheng Investment
non-state-owne 1.98% 10,916,989 0 0
Development Co., Ltd.
d legal person
Airline Trust and Investment Co., State-owned 1.88% 10,340,000 0 0
Ltd. legal person
China Resources SZITIC Trust Co., Domestic 1.09% 6,000,000 0 0
Ltd. legal person
Foreign legal
BOCI SECURITIES LIMITED 1.08% 5,946,950 0 0
person
GUOTAIJUNAN
Foreign legal
SECURITIES(HONGKONG) 1.06% 5,825,699 0 0
person
LIMITED
Domestic
Xinliyi Investment Management
non-state-owne 1.02% 5,600,000 0 0
Co., Ltd.
d legal person
Foreign legal
Jingchao Investment Co., Ltd. 0.91% 5,001,944 0 0
person
Particulars about the shares held by the top ten unrestricted shareholders
Amount of unrestricted shares
Full Name of shareholder Type of shares
held
China Bicycle Company (Holdings)
26,000,000 RMB common shares
Limited
Shenzhen Kangsheng Investment
10,916,989 RMB common shares
Development Co., Ltd.
Airline Trust and Investment Co., Ltd. 10,340,000 RMB common shares
China Resources SZITIC Trust Co., Ltd. 6,000,000 RMB common shares
Domestically listed foreign
BOCI SECURITIES LIMITED 5,946,950
shares
GUOTAI JUNAN
Domestically listed foreign
SECURITIES(HONGKONG) 5,642,699
shares
LIMITED
Xinliyi Investment Management Co.,
5,600,000 RMB common shares
Ltd.
Jingchao Investment Co., Ltd. 5,001,944 RMB common shares
Geng Guohua 2,230,000 RMB common shares
Domestically listed foreign
TANG JING YUAN 2,213,175
shares
Among the top ten shareholders the Company was unaware of whether
there existed associated relationship or whether there existed consistent
Explanation on associated actionist regulated in the Management Measure of Information Disclosure
relationship among the top on Change of Shareholding for Listed Companies; among the other
ten shareholders or circulating shareholders, the Company was unaware of whether there
consistent action existed associated relationship or whether there existed consistent
actionist regulated in the Management Measure of Information Disclosure
on Change of Shareholding for Listed Companies
Note: the original name of China Bicycle Company (Holdings) Limited is HONGKONG (LINK)
BICYCLES LIMITED.
(III) Change on controlling shareholder or actual controller of the Company in reporting
period:
Name of new controlling Shenzhen Guocheng Energy Investment Development Co., Ltd.
shareholder
Date of change on new controlling
2011-01-03
shareholder
Publishing date of particulars about
2011-01-10
change on new controlling
shareholder
Publishing media of particulars
Securities Times, Hong Kong Commercial Daily and Juchao
about change on new controlling
Website
shareholder
Name of new actual controller Ji Hanfei
Date of change on new actual
2011-01-03
controller
Publishing date of particulars about
2011-01-10
change on new actual controller
Publishing media of particulars
Securities Times, Hong Kong Commercial Daily and Juchao
about change on new actual
Website
controller
Section IV. Particular about Directors, Supervisor, Senior Executives and
Employees
(I) Particulars about changes in shares held by directors, supervisors and senior executives
Unit: Share
Shares Shares
increasi decreasi
Shares Shares Of which: Amount of
ngly ngly
held in held in amount of share option Reason for
Name Position held in held in
year-b period-e restricted held in change
the the
egin nd shares held period-end
report report
period period
Zheng
Supervis
Zhonghuan 11,930 0 0 11,930 0 0 -
or
Elected as
supervisor of staff
Supervis representative of
or of the 7th session of
Tao
staff 3,500 0 0 3,500 0 0 board of
Hualiang
represen supervisors in the
tative Workers’
Congress held on
Jun. 7.
(II) In the report period, particulars about new engagement or dismission of the Company’s
directors, supervisors and senior executives
1. In reporting period, the office term of the 6th session of board of supervisors was due. The 2011
extraordinary shareholders’ general meeting held on Jun. 28 of 2011 elected the 7th session of board
of supervisors, including, Mr. Xiao Yan and Mr. Zheng Zhonghuan were elected as supervisors of
the 7th session of board of supervisors with a same office term with the 7th session of board of
supervisors. Workers’ Congress was held on Jun. 7 of 2011 and it elected Mr. Tao Hualiang as
supervisor of staff representative of the 7th session of board of supervisors with a same office term
with this session of board of supervisors.
2. On Jun. 28 of 2011, the Company held the 7th session of board of supervisors and elected Mr.
Xiao Yan as convener of the 7th session of board of supervisors with a same office term with this
session of board of supervisors.
Section V. Report of the Board
(I) Discussion and analysis on the general operation of the Company during the report period
No change happened to the main business and the industry that the Company belonged to during the
report period. In the 1st half year of 2011, managers led all the staffs to actively conduct working,
taking correct decision made on board of directors as guidance, surrounding aspects such as
developing electric bicycle, main business of bicycle, adjusting operational institution and
integrating human resource, replying law suit and promoting debts restructure. In aspect of electric
bicycle, bicycle business, we regulated products structure, improved brand impact, added sale
volume of electric bicycle. And we extended net terminal, enhanced investment in new products,
actively developed new customers and vigorously conducted group-purchase, thus kept steady
growth of main business. In aspect of property lease and management, we enlarged lease area and
increased lease income through changing lease method and clearing spaces. And we enhanced
electricity utilization and saved cost of electricity utilization. Meanwhile, we strengthened safety
management, conducted normal management of safe management, thus ensured normal order of
production and operation of the Company.
In reporting period, the Company realized RMB 126.2355 million of main business income. The
Company conducted debt composition at year-end 2010 thus reduced interest-bearing debt and
reduced financial expenses. In this period, appreciation of RMB produced a substantial exchange
income; and restructure plan of Guangdong Shengrun Group Co., Ltd had been ruled by Shenzhen
Medium People’ Court on Apr. 25 of 2011 and fully completed. The Company reduced book debt
accrued in advance and included projected liability in non-operating income. The Company realized
RMB 26.2131 million of net profit in this reporting period.
(II) Compare the financial indexes in report period with that of last period:
1. Operation achievement:
Proportion of
financial indexes Amount(RMB)
increased/decreased
Jan.-Jun.2011 Jan.-Jun.2010
Operation income 136,537,595.25 120,622,786.14 13.19%
Operation profit -21,589,373.90 -52,431,969.81 -58.82%
Net profit 26,213,055.39 -51,719,360.41 -150.68%
Net increase amount of cash 2,541,797.14 3,302,438.34
-23.03%
and cash equivalent
2. Financial status:
Proportion of
Item Amount(RMB)
increased/decreased
2011-6-30 2010-12-31
Current assts 79,753,581.93 62,101,170.15 28.43%
Total assets 150,424,997.29 138,158,078.89 8.88%
Current liabilities 1,697,155,414.89 1,715,255,078.84 -1.00%
Shareholders’ equity -1,712,943,370.52 -1,756,185,442.87 -2.46%
Note: particulars and reason on the major items of accounting statements and financial indexes with
major changes
Notes receivable: decreased by 52.45% over period-begin mainly due to change of calculation
method of sale business;
Inventory: increased by 82.18% over period-begin mainly due to preparation for welcoming busy
sale season;
Accounts received in advance: increased by 35.62% over period-begin mainly due to loan received
in advance in busy sale season increased;
Other accounts payable: increased by 140.63% over period-begin mainly due to change of creditors
and corresponding regulation of bookkeeping subjects.
Non-current liability due within 1 year: decreased by 34.40% over period-begin mainly due to
change of creditors and corresponding regulation of bookkeeping subjects.
Financial expense: decreased by 61.02% over same period of last year mainly due to appreciation of
RMB in this period brought substantial exchange income and decrease of interest-bearing debts.
Non-operating income: increased by 5885.69% over same period of last year mainly due to court
ruled debt restructure plan of Shengrun Company and it had been fully completed, and the
Company reduced book debt accrued in advance and projected liability.
3. Operation on main business:
During the report period, the main business and the industry that the Company belonged to didn’t
changed. From January to June of 2011, the Company realized main business income of RMB
126.2355 million, 11.95% up over the same period of last year; and realized net profit of RMB
26.2131 million
(1) Main business classified according to industries and products
Unit: RMB’0000
Main business classified according to industries
Increase/d
Increase/decr ecrease in
Classified Increase/decrease
Gross ease in gross
according to Operating Operating in operating
profit operating cost profit
industries or revenue cost income
ratio % year-on-year ratio
products year-on-year %
% year-on-y
ear%
Bicycles and
accessories and 12,509.87 11,962.77 4.37 12.08 12.17 -1.61
fittings
Property
113.67 205.41 -80.71 -1.44 0.17 3.71
management
Main operations classified according to products
Bicycles and
accessories and 12,509.87 11,962.77 4.37 12.08 12.17 -1.61
fittings
Property
113.67 205.41 -80.71 -1.44 0.17 3.71
management
(2) Particulars about main operations classified according to areas
Unit: RMB’0000
Increase/decrease in income from
Areas Income from operations
operations over last year (%)
Shandong 4,228.88 11.37
Henan 2,863.70 18.94
Jiangsu 1,893.30 7.17
Hebei 1,293.90 -5.79
Sichuan 259.13 63.02
(3) Particular about major suppliers and clients
Purchase amount from the top five suppliers of the Company was RMB 129,299,600, occupied
89.99% of the total annual purchase amount; the sales amount towards top five clients was RMB
105,389,000, an 77.19% of the total annual sale amount.
4. Problems and difficulties in operation and relevant solving scheme:
(1) Dramatically impact on domestic consumer market from the global economic environment,
majority export-oriented enterprise transferred the orientation to domestic market. And the bicycle
and eclectic vehicle market faces an environment of price-war competition;
(2) The Company has the problem of facing a huge debt approximately amount to RMB 1.9 billion.
The resolving of the debt was very complicated due to the long-term debts, complexity condition
and with many debtors.
Faced with the above problems, the Company in one hand will vigorously explore main business
and ensure sustainable and steady growth of main business, especially in the production and sale in
higher added value electric vehicles; on the other hand, actively promote the process of
restructuring of whole the Company including the debt restructure.
(III) Particular about the investment in report period
There are no fund raising and major investment activities of the Company happened in the report
period.
(IV) working plan in 2nd half year of the Company
(1) Continuously actively coordinate shareholders and the board of directors to vigorously conduct
debts restructure, strive a substantive improvement of debts restructure of Shenzhonghua;
(2) Complete establishment of internal control system, improve operation efficiency and
performance;
(3) Ensure stable growth in main business, strengthen property lease and assets management, and
thus improve overall operation earnings of the Company;
(4) Integrate human resources; realize rationalization and optimization of human resource grouping.
(V) Explanation presented by the Board for change and treatment of the matters involved in
the Non-standard Report issued by CPAs for last year:
Shenzhen Pengcheng Certified Public Accountants Co., Ltd. issued audit report with disclaimer of
opinions for the 2010 Financial Report of the Company. The Board of Directors agreed the 2010
Auditor’s Report offered by Shenzhen Pengcheng Certified Public Accountants Co., Ltd. Due to
that the debt reorganization work of the Company had not been completely finished in 2010, so risk
of bearing huge debt still remained with many significant uncertainties. The CPAs was not able to
offer opinion on the financial debt, tax payable, contingent proceedings, lawsuits and sustainable
operation. In light of that, the Board of the Company made the following explanations:
1. Financial debt:
Shenzhen Pengcheng CPAs held that: the letters replied from the financial creditors for the inquiry
showed that the Company missed to record an interest balance totaling amount to RMB
324,879,558.04, and principal of loans which haven’t been replied totaled to RMB 111,584,308.44,
so it was not available to confirm influence on financial statement by financial debt.
The Company provided explanation in Note 10 for details of interest confirmation balance. When
some creditors implemented the document ([2004] No.6) released by China Committee on Bank
Supervision, they had different understanding on this document with the Company. The document
noticed that: Bank of China and other 10 financial organizations stop calculating the interest of the
Company for 3 years since January 1st of 2002 and at the same time, exempt all the interest payable
of the Company (including penalty interest and compound interest) occurred before December 31st
of 2001.
Some assets management companies and banks considered that the Company was expected to
return the interest exempted and stop-calculated, and some assets management companies had not
confirmed the proceeding of interest calculation. The Company had transferred all the interest of
loans payable owed before Dec 31st of 2001, RMB 357,993,665.24 (including penalty interest and
compound interest) to capital public reserve. Interest was stopped with calculation from January 1st
of 2002 to December 31st of 2004. The exempt term was due on December 31st of 2004. The
Company held it was not necessary to return the interest exempted and stop-calculated, so when the
term was due, the Company started to withdraw interest according to normal loan for those interests
which needed to be returned. The stop-calculated interest and compound interest from January 1st of
2002 to December 31st of 2004 was not accrued.
Besides, the financial debt of the Company was formed in history which had occurred for a long
time and the amount of period–end had not changed for years. Body qualification of some creditors
had been transferred and the particular personnel for handling had also changed, so the creditors
needed time to check clearly the amount of creditor and debt of both involved parties and that was
why some creditors had not replied the letters to confirm.
The Company would continuously advance the account-check work with the relevant creditors of
financial debt, trying as soon as possible to check clearly the interest on principal of the financial
debt. Once progress is made, relevant information would be disclosed according to relevant
regulation.
2. Issues on tax payable:
Shenzhen Pengcheng Certified Public Accountants Co., Ltd. thought that: in the audit process, the
CPAs implemented audit procedures including inspection and inquiry, inquiring book tax amount
payable, custom guarantee and penalty balance totaling to RMB 119,902,328.56. Till the day of
auditing report, no reply has been received, so it was impossible for the CPAs to confirm the
influence on financial statement of the Company.
Due to the Company’s tax payable was formed in the past, which had a long time, there was no
newly-increased tax payable in the report period, forming reasons were complex, personnel of
specific affairs had changed, and tax department needed time to check clear the debts rights and
amounts of both sides, therefore, we are not able to receive confirmation letter from tax department.
According to the regulations in Administration of Tax Collection regulated by the State, it is
possible to repay the penalties and overdue fine. The Company will continue to follow up the work
of checking account of tax department, check clear the amount of tax payable as soon as possible,
and will disclose information according to the requirements of relevant regulations if there is some
progress.
3 Contingent events and lawsuits:
Shenzhen Pengcheng Certified Public Accountants believed that: card information for loans of the
Company was not accordant because of system updating and other seasons; during the auditing, the
CPAs made field verification in relevant courts involved in lawsuits for external guarantee and
overdue loans of the Company as substitute audit procedure, while no confirmation document had
been obtained from the relevant courts. Besides, due to that it was hard to implement other effective
audit procedures, it was unable for us to judge whether the Company had disclosed complete
contingent events and lawsuits, and impacts on its financial statement.
The historically formed loan and guarantee lawsuit had existed rather long time; in the report period,
there was no newly-added undisclosed guarantee events and lawsuits; part courts in charge of those
lawsuits changed, and specific responsible people also altered; the court needs time to check details
and amount of the case, so the court didn’t write back for confirmation. The Company will continue
follow up the check work by certified public accountants with related courts, and checks clear the
contingent events and lawsuits as soon as possible. If there is any progress, information disclosure
will be made according to requirements of relevant regulations.
4. Matters on sustainable operations:
Shenzhen Pengcheng Certified Public Accountants thought that, the Company’ asset could seriously
not offset the debt; the measures on the reconciliation procedure of the bankruptcy to settle the
debts had no material progress and could not be able to get adequate and proper audit evidence to
confirm it could effectively improve the continuous operations of the Company; thus, we could not
judge whether the financial report 2010 prepared by the Company based on imagined continuous
operations was proper. Measures from the Company and largest creditor are as followed:
Since March 2002, the promotion on debt restructuring by the former largest creditor of the Company-China Huarong Asset Management Corporation
acquired breakthrough development. Relevant department such as China Banking Regulatory Commission approved that all the interests of the
financial debts the Company owed ended December 31st, 2004 were exempted and stopped interest calculation.
The Company and International Finance Corporation signed Reconciled Agreement on March 29th
of 2007, in which it was agreed to settle all the credits and liabilities between the two parties with
USD equivalent to RMB 2 million. The liabilities amount was consisted of principal approximately
amounting to USD 3.87 million and an accrued interest approximately amounting to RMB 42.78
million.
On Oct. 15 of 2010, the Company signed the Debts Reconcile Term with Shenzhen Chengxingtai
Investment Co., Ltd which agreed the Company should pay the compensation to Chengxingtai
Company with RMB 14 million thus settled up all the creditor’s right and debts (about RMB 150
million). The above RMB 14 million has been settled up on Nov. 30 of 2010 totally.
On December 30, 2006, China Huarong Asset Management Corporation transferred its creditor
right to Shenzhen Guosheng Energy Investment Development Co., Ltd.( Guosheng Energy
Company for short), relevant debt restructure work have been in promotion by Guosheng Energy
Company recently and obtained certain progress. Due to the change of largest shareholder of the
Company and the implementation of new Bankruptcy Law, Guosheng Energy Company applied to
the Shenzhen Intermediate People’s Court in January 2010 for restructuring the Company according
to the regulation of Bankruptcy Law, with the purpose of recovering and improving the ability of
sustainable operations of the Company. On Dec. 28 of 2010, Shenzhen Intermediate People’s Court
believed that applicants didn’t submit materials such as solution plan both parties accepted which
was formed from settlement of tax income and creditor’s right with tax department, and then ruled
that they didn’t accept application of bankruptcy restructure Shenzhen Guochen Energy Investment
and Development Co., Ltd raised up. Besides, Guochen Energy Company agreed to stop accounting
RMB 17.029 million of loan interests in 2011. This item of interests won’t be received in future
years.
In promoting the work of debt restructure, the Company realized a stable development and profits
continuity in main business. The short-term pressure of payment have been released, the ability of
sustainable operations got a certain improvement. Board of the Company considered that: as the
debt and assets restructure of the Company continuously made progress, the operation environment,
operation status and sustainable operation ability would be improved in future.
Section VI. Significant Events
(I) Corporation governance
In the report period, the Company strictly conformed to regulations of standard documents such as
Company Law, Securities Law, the laws and codes of CSRC and Shenzhen Stock Exchange and
relevant regulations, perfected the corporation governance structure continuously. The works of
shareholders’ general meeting, the board of directors, supervisory committee and management
group all operated strictly according to the requests of the foresaid documents and each bylaws of
the Company. The actual conditions about corporate governance of the Company accorded with the
requests of relevant standard documents on governance of listed company promulgated by CSRC.
Based on requirements of Notice to Focus on Relevant Working about Normalization Spot about
Internal Control of Listed Companies in Shenzhen issued by Shenzhen Securities Supervision
Bureau, in reporting period the Company positively conducted preparation working for internal
control implementation, formulated Working Program of Internal Control, engaged professional
consultation for internal control construction. Various workings presently are in a steady promotion
in accordance with the progress of the plan.
(II) In the report period, the execution of profit distribution and plan of transferring the
public reserve capital into share capital:
At the semi-annual of 2011, the Company did not distribute profit, nor had plans of transferring the
public reserve capital into share capital.
(III) Material lawsuits and arbitrations in the report period.
In the report period, the Company had no material lawsuits and arbitrations.
(IV) No purchase and sales of significant assets in the report period.
In the report period, the Company had no purchase significant assets activity.
(V) Significant related transactions in the report period:
Non-recurring credit and debt in the report period:
Unit: RMB’0000
Funds offered to Funds offered to the listed company by
related parties related parties
Related parties
Amount
Balance Amount occurred Balance
occurred
Shenzhen Guocheng Energy
0.00 0.00 0.00 42,590.59
Investment Development Co., Ltd.
Shenzhen Guocheng Energy
0.00 0.00 39.38 334.26
Investment Development Co., Ltd.
Shenzhen Guocheng Energy
0.00 0.00 0.00 650.00
Investment Development Co., Ltd.
Shenzhen Jinhuan Printing Format
0.00 0.00 0.00 261.64
Co., Ltd.
Total 0.00 0.00 39.38 43,836.49
Of which: in the report period, the occupied occurring amount and balance that listed company
provided capital to its shareholders and subsidiaries were respectively RMB 0.00 and RMB 0.00.
(VI) Significant contracts and its implementation
1. In the report period, the Company had not entrusted, contracted or leased the assets of other
companies, nor had other companies entrusted, contracted or leased the assets of listed companies.
2. In the report year, the Company had no entrusted financing.
3. In the report period, the Company had not provided guarantees for controlling subsidiary, the
guaranteed occurred in previous years were as follows:
Unit: RMB’0000
Particulars about the external guarantee of the Company (Barring the guarantee for the controlling subsidiaries)
Related
Announc
Date of
ement Comple
happening Actually
Name of the disclosur Guaran Guar te Guarantee for
(Date of guarante Guaran
Company e day and tee antee implem related party
signing e tee type
guaranteed No. of limit term entation (Yes or no)
agreement amount
the or not
)
guarantee
amount.
Guangdong Jointly 4
1996.07. 1,960.0 1996-07-2
Sunrise Group 1,960.00 respons mont Not No
26 0 6
Co., Ltd. ibility hs
Guangdong Jointly 12
1999.09. 1999-09-3
Sunrise Group 477.28 477.29 respons mont Not No
30 0
Co., Ltd. ibility hs
Guangdong Jointly 11
1998.04. 1998-04-3
Sunrise Group 182.00 182.00 respons mont Not No
30 0
Co., Ltd. ibility hs
Guangdong Jointly 7
1997.07. 1997-07-3
Sunrise Group 175.00 175.00 respons mont Not No
30 0
Co., Ltd. ibility hs
Guangdong Jointly 8
1997.06. 1997-06-0
Sunrise Group 210.00 210.00 respons mont Not No
04 4
Co., Ltd. ibility hs
Jointly 6
Gintian Industry 1998.10. 5,000.0 1998-10-3
5,000.00 respons mont Not No
(Group) Co., Ltd. 30 0 0
ibility hs
Shenzhen
Jointly
Tianma 1994.09. 1994-09-3 12mo
800.00 800.00 respons Not No
Cosmetics Co., 30 0 nths
ibility
Ltd
Total external guarantee amount approved in Total actual external guarantee amount
0.00 0.00
reporting period(A1) approved in reporting period(A2)
Total actual balance of external
Total external guarantee amount approved at
0.00 guarantee amount approved at the end 8,804.29
the end of reporting period(A3)
of reporting period(A4)
Guarantee of the Company for its subsidiaries
Related
Date of
Announc
happeni
ement Comple
ng Guarantee
Name of the disclosur Guar Actually te
(Date Guarantee Guarant for related
Company e day and antee guarantee implem
of type ee term party (Yes
guaranteed No. of limit amount entation
signing /No)
the or not
agreem
guarantee
ent)
amount
Shandong
Jiahua 1997.09. 1997-0 Jointly 4
8.31 8.31 Not No
Economy-Trad 03 9-03 responsibility months
ing Co., Ltd.
1996.03. 7,808 1996-0 Jointly 9
Zoria Pte Ltd 7,808.70 Not No
25 .70 3-25 responsibility months
Total of guarantee for subsidiaries Total of actual guarantee for subsidiaries in the
0.00 0.00
approved in the Period (B1) Period (B2)
Total of guarantee for subsidiaries Total of actual guarantee for subsidiaries at
0.00 7,817.01
approved at Period-end (B3) Period-end (B4)
Total of Company’s guarantee(namely total of the large two aforementioned)
Total of guarantee approved in the Total of actual guarantee in the Period
0.00 0.00
Period (A1+B1) (A2+B2)
Total of guarantee approved at
Total of actual guarantee at Period-end
Period-end 0.00 16,621.30
(A4+B4)
(A3+B3)
The proportion of the total amount of actually guarantee in the net assets of the Company(that
-9.70%
is A4+ B4)
Including:
Amount of guarantee for shareholders, actual controller and its associated parties(C) 0.00
The debts guarantee amount provided for the guaranteed parties whose assets-liability ratio
16,621.30
exceed 70% directly or indirectly(D)
Proportion of total amount of guarantee in net assets of the Company exceed 50%(E) 0.00
Total guarantee amount of the abovementioned guarantees(C+D+E) 16,621.30
Explanations on possibly bearing joint and several liquidating responsibilities for undue
N/A
guarantees
Note: Guangdong Sunrise Group Co., Ltd. was the shareholder of the Company, its equity was
auctioned by the court and now it is not the shareholder of the Company.
4. Explanation on the external guarantees of the Company, accumulative total and the current ones,
issued by the independent directors:
According to the regulations of Concerning Some Issues on Regulating the Funds between Listed
Companies and Associated Parties and Listed Companies’ Provision of Guaranty to Other Parties
(No. 56 [2003] promulgated by CSRS) as the independent directors of Shenzhen China Bicycle
Company (Holdings) Limited, we made inspection on the accumulative and current external
guarantees of the Company and also on the guarantee getting out of line, here comes the detail
explanation:
In report period, no guarantee offered to controlling shareholder and its enterprises that violated
regulations occurred.，The guarantee provided to controlling shareholder and its enterprises that
violated regulations from 1996 to 1999 belongs to events that formed historically. Majority of the
guarantee were treated as predicted liability for failure payment ability of most of the secured party.
In Apr. of 2011, Shenzhen Medium People’s Court ruled restructure plan of Guangdong Shengrun
Group Co., Ltd and it had been fully completed. In accordance with restructure plan, discharge
proportion of ordinary creditor's rights was about 30%. Thus the Company correspondingly reduced
projected liability concerning Shengrun Company. Concerned amount was RMB 12,875,490.00.
After these reduce, projected liability of the Company became RMB 166,212,952.92.
(VII) Particulars about the Company’s reception of investigation and interview
In accordance with the requirements of Guidance for Fair Information Disclosure for Listed
Companies of Shenzhen Stock Exchange, the Company earnestly implements the System of
Reception and Popularization. The Company and relevant personnel in charge of information
disclosure strictly follow the principle of fair information disclosure. Situation that different
treatment policy is not implemented; non-public significant information is not disclosed, revealed or
leak out for appointed person.
The received Contents discussed and materials
Date Place Way
parties supplied
Phone
Jan. -June, Secretary office of Public Progresses of equity division
communica
2011 Board shareholders reform
tion
(VIII) Other significant events
1. Change of actual controller: on Jan. 3 of 2011, Shenzhen Guomin Investment Development Co.,
Ltd which is controlling shareholder of our major shareholder Shenzhen Guosheng Energy
Investment Development Co., Ltd, signed equity transfer agreement, Guomin Investment
transferred 100% equity of Guosheng Energy to Mr. Ji Hanfei with price of RMB 70 million. Thus
legal representative of Guosheng Energy became Mr. Ji Hanfei instead of Mr. Shang Shijun. This
equity transfer belonged to change of actual controller of the Company. In accordance with rules of
Administration Method of Purchase of Listed Companies, on Apr. 11 of 2011, we fulfilled
disclosure of Report of Detailed Equity Change and Report of Simple Equity Change.
2. Creditor’ right transfer: previous creditor Guangdong Shengrun Group Co., Ltd entrusted
Shenzhen Run Eastern Auction Co., Ltd to auction RMB 232,801,657.06 of creditor’s right of the
Company during bankruptcy and restructure period. On Dec. 13 of 2010 Shenzhen Dongtaixing
Technology Co., Ltd bid the above creditor’ right legally; on Jan. 27 of 2011 Shenzhen Medium
People’s Court issued civil ruling letter (2010) SZFMQZZi No. 5-12, confirmed barging of buyer
Shenzhen Dongtaixing Technology Co., Ltd over the above creditor’ right of Shengrun Company.
This transfer didn’t take impact on finance of the Company presently.
3. Particulars about that the secondary majority creditor applied to Shenzhen Medium People’s
Court for bankruptcy and restructure of the Company: the Company received letter from creditor
Shenzhen Dongtaixing Technology Co., Ltd (hereinafter referred to as Dongtaixing Company)
namely Zhihui and learned: regarding Shenzhen Medium People’s Court on Dec. 28 of 2010 ruled
not to accept application from major shareholder Shenzhen Guosheng Energy Investment
Development Co., Ltd over bankruptcy and restructure of the Company. As the 2nd largest creditor,
Dongtaixing Company had formally submitted document and legally applied to Shenzhen Medium
Court for bankruptcy and restructure of Shenzhonghua on Mar. 17 of 2011.
Currently, Dongtaixing Company is busy with preparing for relevant hearing procedures. Shenzhen
Medium People’s Court required applier to submit materials about agreement with tax department
and disposal of tax creditor’s right which both parties accept. Thus there is still uncertainty whether
this application can be into restructure procedure. Even though court accepts the case, restructure
fails the Company will be faced with bankruptcy and composition. Investors please pay attention to.
The board of directors will closely track progress of the case; strictly and timely disclose relevant
information.
4. On Jun. 7 of 2011, the Company received Reply to Letter about Applying for Stopping
Calculating 2011 Annual Debt Interest of the Company from major shareholder and largest creditor
namely Shenzhen Guosheng Energy Investment Development Co., Ltd (hereinafter referred to as
Guosheng Energy): Guosheng Energy agreed to dismiss 2011 annual interests on RMB
9,124,638.59 and USD 62,829,259.02 of debts held from the Company. Interests which were
stopped to be calculated above won’t be charged again.
The stopping-calculation of interests on debts could put a positive impact on sustainable operation
of the Company. Stopped-calculated interests amounted to about RMB 24 million. The Company
will deal this account in accordance with relevant accounting policy and relevant rules, and include
them in capital reserve, which will not affect gains and losses of the Company.
Section VII. Financial Report
(Attached)
Section VIII. Documents Available for Reference
(I) Text of Semi-annual Report 2011 carrying the genuine signatures of legal representative
(II) Text of financial report carrying the autograph and seals of legal representative, principal in
charge of the accounting affairs and principal in charge of the accounting institute;
(III) Original texts of all documents and announcement disclosed publicly in the newspapers
designated by China Securities Regulatory Commission in the report period;
(IV) English version of the 2011 Semi-annual Report.
Board of Directors of
Shenzhen China Bicycle Company (Holdings) Limited
19 August 2011
Shenzhen China Bicycle Company (Holdings) Limited
Semi-Annual Financial Report for Year 2011
(Un-audited)
Content
Content Pages
I. Financial statement
Balance Sheet(Consoldiated & Parent Company) 3-7
Profit Statement (Consoldiated & Parent Company) 9-11
Cash Flow Statement (Consoldiated & Parent Company) 12-15
Statement on Changes of Owners’ Equity (Consoldiated & 16-22
Parent Company)
II. Notes to financial statement 23-69
Consolidated Balance Sheet
2011-06-30
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Items Note Balance at period-end Balance at year-begin
Current assets:
Monetary funds V. 1 20,298,570.72 17,756,773.58
Settlement provisions - -
Capital lent - -
Transaction finance asset - -
Notes receivable V. 2 1,245,768.00 2,619,699.00
Accounts receivable V. 3 1,052,689.02 1,732,822.98
Accounts paid in advance V. 4 306,607.08 213,423.41
Insurance receivable - -
Reinsurance receivables - -
Contract reserve of
- -
reinsurance receivable
Interest receivable - -
Dividend receivable - -
Other receivables V. 5 17,331,037.56 18,085,772.89
Purchase restituted finance
- -
asset
Inventories V. 6 39,518,909.55 21,692,678.29
Non-current asset due within
- -
one year
Other current assets - -
Total current assets 79,753,581.93 62,101,170.15
Non-current assets:
Granted loans and advances - -
Finance asset available for
- -
sales
Held-to-maturity securities - -
Long-term account receivable - -
Long-term equity investment V. 7 2,619,840.50 2,619,840.50
Investment property V. 8 24,095,741.57 26,434,648.24
Fixed assets: V. 9 18,932,837.05 21,547,992.74
Construction in progress - -
Engineering material - -
Disposal of fixed asset - -
Productive biological asset - -
Oil and gas asset - -
Intangible assets V. 10 25,022,996.24 25,454,427.26
Expense on Research and
- -
Development
Goodwill - -
Long-term expenses to be
- -
apportioned
Deferred income tax asset - -
Other non-current asset - -
Total non-current asset 70,671,415.36 76,056,908.74
Total assets 150,424,997.29 138,158,078.89
20
Consolidated Balance Sheet (Cont)
2011-06-30
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Items Note Balance at period-end Balance at year-begin
Current liabilities:
Short-term loans V. 12 379,465,125.28 384,217,648.09
Loan from central bank - -
Absorbing deposit and interbank
- -
deposit
Capital borrowed - -
Transaction financial liabilities - -
Notes payable - -
Accounts payable V. 13 139,529,336.85 125,628,122.72
Accounts received in advance V. 14 22,595,828.34 16,661,602.20
Selling financial asset of repurchase - -
Commission charge and
- -
commission payable
Wage payable V. 15 3,135,206.88 3,802,240.39
Taxes payable V. 16 95,593,997.42 98,218,863.73
Interest payable V. 17 193,470,439.90 213,488,233.36
Dividend payable - -
Other accounts payable V. 18 399,061,764.24 165,837,025.40
Reinsurance payables - -
Insurance contract reserve - -
Security trading of agency - -
Security sales of agency - -
Non-current liabilities due within 1
463,546,803.89 706,645,180.86
year V. 19
Other current liabilities V. 20 756,912.09 756,162.09
Total current liabilities 1,697,155,414.89 1,715,255,078.84
Non-current liabilities: - -
Long-term loans - -
Bonds payable - -
Long-term account payable - -
Special accounts payable - -
Projected liabilities V. 21 166,212,952.92 179,088,442.92
Deferred income tax liabilities - -
Other non-current liabilities - -
Total non-current liabilities 166,212,952.92 179,088,442.92
Total liabilities 1,863,368,367.81 1,894,343,521.76
Shareholders’ equity):
Paid-in capital (or share capital) V. 22 551,347,947.00 551,347,947.00
Capital public reserve V. 23 444,161,710.87 427,132,693.91
Less: Inventory shares - -
Reasonable reserve - -
Surplus public reserve V. 24 32,673,227.01 32,673,227.01
Provision of general risk - -
Retained profit V. 25 -2,741,126,255.40 -2,767,339,310.79
Balance difference of foreign
- -
currency translation
Total owners’ equity attributable to
-1,712,943,370.52 -1,756,185,442.87
parent company
Minority interests - -
Total owners’ equity -1,712,943,370.52 -1,756,185,442.87
Total liabilities and owners’ equity 150,424,997.29 138,158,078.89
21
Balance Sheet of Parent Company
2011-06-30
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Items Note Balance at period-end Balance at year-begin
Current assets:
Monetary funds 529,240.47 498,624.71
Transaction finance asset - -
Notes receivable - -
Accounts receivable XI 1 806,891.48 1,384,353.23
Accounts paid in advance 30,000.00 -
Interest receivable - -
Dividend receivable - -
Other receivables XI 2 32,466,135.44 30,529,810.28
Inventories 14,923,867.44 14,965,196.51
Non-current asset due within one
- -
year
Other current assets - -
Total current assets 48,756,134.83 47,377,984.73
Non-current assets:
Finance asset available for
sales - -
Held-to-maturity securities - -
Long-term account receivable - -
Long-term equity investment XI 3 2,619,840.50 2,619,840.50
Investment property 24,095,741.57 26,434,648.24
Fixed assets: 18,620,821.72 21,221,962.11
Construction in progress - -
Engineering material - -
Disposal of fixed asset - -
Productive biological asset - -
Oil and gas asset - -
Intangible assets 25,022,996.24 25,454,427.26
Expense on Research and
Development - -
Goodwill - -
Long-term expenses to be
apportioned - -
Deferred income tax asset - -
Other non-current asset - -
Total non-current asset 70,359,400.03 75,730,878.11
Total assets 119,115,534.86 123,108,862.84
22
Balance Sheet of Parent Company (Cont)
2011-06-30
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Item Note Balance at period-end Balance at year-begin
Current liabilities:
Short-term loans 327,264,738.26 332,017,261.07
Transaction financial liabilities - -
Notes payable - -
Accounts payable 148,414,384.41 148,454,726.88
Accounts received in advance 10,664,592.85 10,664,592.85
Wage payable 1,988,775.21 2,372,320.02
Taxes payable 94,823,161.48 95,784,336.55
Interest payable 193,470,439.90 213,488,233.36
Dividend payable - -
Other accounts payable 354,975,822.25 120,844,911.76
Non-current liabilities due within
one year 463,546,803.89 706,645,180.86
Other current liabilities 726,612.09 726,612.09
Total current liabilities 1,595,875,330.34 1,630,998,175.44
Non-current liabilities:
Long-term loans - -
Bonds payable - -
Long-term account payable - -
Special accounts payable - -
Projected liabilities 166,212,952.92 179,088,442.92
Deferred income tax liabilities - -
Other non-current liabilities - -
Total non-current liabilities 166,212,952.92 179,088,442.92
Total liabilities 1,762,088,283.26 1,810,086,618.36
Owners’ equity(Shareholders’ equity):
Paid-in capital (or share capital) 551,347,947.00 551,347,947.00
Capital public reserve 444,161,710.87 427,132,693.91
Less: Inventory shares - -
Reasonable reserve - -
Surplus public reserve 32,673,227.01 32,673,227.01
Provision of general risk - -
Retained profit -2,671,155,633.28 -2,698,131,623.44
Total owners’ equity(or
-1,642,972,748.40 -1,686,977,755.52
shareholders’equity)
Total liabilities and owners’ equity(or
119,115,534.86 123,108,862.84
shareholders’equity)
23
Consolidated Profit Statement
January – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount in this Amount in same period
Items Note
period of last year
I. Total operating income 136,537,595.25 120,622,786.14
Including: Operating income V. 26 136,537,595.25 120,622,786.14
Interest income - -
Insurance gained - -
Commission charge and commission income - -
II. Total operating cost 158,126,969.15 173,054,755.95
Including: Operating cost V. 26 126,708,502.29 114,045,625.35
Interest expense - -
Commission charge and commission expense - -
Cash surrender value - -
Net amount of expense of compensation - -
Net amount of withdrawal of insurance
contract reserve - -
Bonus expense of guarantee slip - -
Reinsurance expense - -
Operating tax and extras V. 27 138,056.15 81,198.29
Sales expenses V. 28 2,712,707.55 3,756,001.70
Administration expenses V. 29 11,100,530.20 11,959,630.53
Financial expenses V. 30 16,845,373.31 43,212,300.08
Losses of devaluation of asset V. 31 621,799.65 -
Add: Changing income of fair value(Loss is listed
with “-”) - -
Investment income (Loss is listed with “-”) - -
Including: Investment income on affiliated
company and joint venture - -
Exchange income (Loss is listed with “-”) - -
III. Operating profit (Loss is listed with “-”) -21,589,373.90 -52,431,969.81
Add: Non-operating income V. 32 47,835,399.29 799,162.77
Less: Non-operating expense V. 33 32,970.00 30,680.00
Including: Disposal loss of non-current asset - -
IV. Total Profit (Loss is listed with “-”) 26,213,055.39 -51,663,487.04
Less: Income tax expense - -
V. Net profit (Net loss is listed with “-”) 26,213,055.39 -51,663,487.04
Net profit attributable to owners of parent
company 26,213,055.39 -51,719,360.41
Minority shareholders’ gains and losses - 55,873.37
VI. Earnings per share - -
i. Basic earnings per share V. 34 0.0475 -0.0938
ii. Diluted earnings per share V. 34 0.0475 -0.0938
VII. Other consolidated income - -
VIII. Total consolidated income 26,213,055.39 -51,663,487.04
Total consolidated income attributable to owners
of parent company 26,213,055.39 -51,719,360.41
Total consolidated income attributable to minority
shareholders - 55,873.37
24
Profit Statement of Parent Company
January – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount in same period of
Items Note Amount in this period
last year
I. Total operating income XI. 4 11,441,090.83 8,026,148.29
Less: operating cost XI. 4 5,023,916.46 5,650,837.29
Operating tax and extras - -
Sales expenses - -
Administration expenses 9,758,435.28 11,012,931.71
Financial expenses 16,863,378.57 43,238,651.88
Losses of devaluation of asset 621,799.65 -
Add: Changing income of fair value(Loss is
listed with “-”) - -
Investment income (Loss is listed with
“-”) - -
Including: Investment income on affiliated
company and joint venture - -
II. Operating profit (Loss is listed with “-”) -20,826,439.13 -51,876,272.59
Add: Non-operating income 47,835,399.29 793,262.77
Less: Non-operating expense 32,970.00 17,000.00
Including: Disposal loss of non-current asset - -
III. Total Profit (Loss is listed with “-”) 26,975,990. 16 -51,100,009.82
Less: Income tax expense - -
IV. Net profit (Net loss is listed with “-”) 26,975,990. 16 -51,100,009.82
25
Consolidated Cash Flow Statement
January – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount in this Amount in same
Items Note
period period of last year
I. Cash flows arising from operating activities:
Cash received from selling commodities and 94,619,260.36
providing labor services 80,784,747.61
Net increase of customer deposit and interbank
deposit - -
Net increase of loan from central bank - -
Net increase of capital borrowed from other
financial institution - -
Cash received from original insurance contract fee - -
Net cash received from reinsurance business - -
Insured savings and net increase of investment - -
Net increase of disposal of transaction financial
asset - -
Cash received from interest, commission charge and
commission - -
Net increase of capital borrowed - -
Net increase of returned business capital - -
Write-back of tax received - 254,666.00
Other cash received concerning operating activities V. 35(1) 11,378,309.31 9,731,065.31
Subtotal of cash inflow arising from operating 105,997,569.67
activities 90,770,478.92
Cash paid for purchasing commodities and receiving 83,735,852.88
labor service 63,111,200.56
Net increase of customer loans and advances - -
Net increase of deposits in central bank and
interbank - -
Cash paid for original insurance contract
compensation - -
Cash paid for interest, commission charge and
commission - -
Cash paid for bonus of guarantee slip - -
Cash paid to/for staff and workers 7,774,904.02 9,407,539.21
Taxes paid 4,862,414.75 2,652,249.80
Other cash paid concerning operating activities V. 35(2) 8,310,324.46 9,848,757.41
Subtotal of cash outflow arising from operating
activities 104,683,496.11 85,019,746.98
Net cash flows arising from operating activities 1,314,073.56 5,750,731.94
II. Cash flows arising from investing activities:
Cash received from recovering investment - -
Cash received from investment income - -
Net cash received from disposal of fixed, intangible
and other long-term assets 1,267,500.00 -
Net cash received from disposal of subsidiaries and
other units - -
Other cash received concerning investing activities - -
Subtotal of cash inflow from investing activities 1,267,500.00 -
Cash paid for purchasing fixed, intangible and other 39,776.42
long-term assets 2,448,293.60
Cash paid for investment - -
Net increase of mortgaged loans - -
Net cash received from subsidiaries and other units - -
Other cash paid concerning investing activities - -
26
Subtotal of cash outflow from investing activities 39,776.42 2,448,293.60
Net cash flows arising from investing activities 1,227,723.58 -2,448,293.60
III. Cash flows arising from financing activities
Cash received from absorbing investment - -
Including: Cash received from absorbing minority
shareholders’ investment by subsidiaries - -
Cash received from loans - -
Cash received from issuing bonds - -
Other cash received concerning financing activities - -
Subtotal of cash inflow from financing activities - -
Cash paid for settling debts - -
Cash paid for dividend and profit distributing or
interest paying - -
Including: Dividend and profit of minority
shareholder paid by subsidiaries - -
Other cash paid concerning financing activities - -
Subtotal of cash outflow from financing activities - -
Net cash flows arising from financing activities - -
IV. Influence on cash due to fluctuation in exchange rate - -
V. Net increase of cash and cash equivalents 2,541,797.14 3,302,438.34
Add: Balance of cash and cash equivalents at the 17,756,773.58
period -begin 22,232,425.07
VI. Balance of cash and cash equivalents at the period 20,298,570.72
-end 25,534,863.41
27
Cash Flow Statement of Parent Company
Januray – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount in this Amount in same
Items Note
period period of last year
I. Cash flows arising from operating activities:
Cash received from selling commodities and
providing labor services 5,550.00 -
Write-back of tax received - 254,666.00
Other cash received concerning operating activities 11,411,976.29 14,114,777.36
Subtotal of cash inflow arising from operating
activities 11,417,526.29 14,369,443.36
Cash paid for purchasing commodities and receiving
labor service - -
Cash paid to/for staff and workers 926,400.23 826,113.68
Taxes paid 2,301,365.49 1,512,535.65
Other cash paid concerning operating activities 8,145,299.51 9,522,837.40
Subtotal of cash outflow arising from operating
activities 11,373,065.23 11,861,486.73
Net cash flows arising from operating activities 44,461.06 2,507,956.63
II. Cash flows arising from investing activities:
Cash received from recovering investment - -
Cash received from investment income - -
Net cash received from disposal of fixed, intangible
and other long-term assets - -
Net cash received from disposal of subsidiaries and
other units - -
Other cash received concerning investing activities - -
Subtotal of cash inflow from investing activities - -
Cash paid for purchasing fixed, intangible and other
long-term assets 13,845.30 2,438,716.25
Cash paid for investment - -
Net cash received from subsidiaries and other units - -
Other cash paid concerning investing activities - -
Subtotal of cash outflow from investing activities 13,845.30 2,438,716.25
Net cash flows arising from investing activities -13,845.30 -2,438,716.25
III. Cash flows arising from financing activities
Cash received from absorbing investment - -
Cash received from loans - -
Other cash received concerning financing activities - -
Subtotal of cash inflow from financing activities - -
Cash paid for settling debts - -
Cash paid for dividend and profit distributing or
interest paying - -
Other cash paid concerning financing activities - -
Subtotal of cash outflow from financing activities - -
Net cash flows arising from financing activities - -
IV. Influence on cash due to fluctuation in exchange rate - -
V. Net increase of cash and cash equivalents 30,615.76 69,240.38
Add: Balance of cash and cash equivalents at the
period -begin 498,624.71 365,121.06
VI. Balance of cash and cash equivalents at the period
-end 529,240.47 434,361.44
28
Consolidated Statement on Changes of Owners' Equity
Januray – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount in this report period
Owners’ equity attributable to the parent company
Items Less: Minority’s Total owners’
Paid-up capital Capital Special Surplus General risk equity equity
Treasury Retained profit Other
(Share capital) reserves reserve reserve provision
Stock
I. Balance at the end of the
551,347,947.00 427,132,693.91 32,673,227.01 -2,767,339,310.79 -1,756,185,442.87
last year - - - - -
Add: Changes of accounting
policy - - - - - - - - - -
Error correction of the last
period - - - - - - - - - -
Others - - - - - - - - - -
II. Balance at the beginning
551,347,947.00 427,132,693.91 32,673,227.01 -2,767,339,310.79 -1,756,185,442.87
of this year - - - - -
III. Increase/ Decrease in this
year (Decrease is listed with - 17,029,016.96 26,213,055.39 43,242,072.35
“-”) - - - - - -
(I) Net profit - - - - - - 26,213,055.39 - - 26,213,055.39
(II) Other consolidated
- -
income - - - - - - - -
Subtotal of (I) and (II) - - - - - - 26,213,055.39 - - 26,213,055.39
(III) Owners’ devoted and
17,029,016.96 17,029,016.96
decreased capital - - - - - - - -
1. Owners’ devoted capital - - - - - - - - - -
2. Amount calculated into
-
owners’ equity paid in shares - - - - - - - - -
3. Others - 17,029,016.96 - - - - - - - 17,029,016.96
(IV) Profit distribution - - - - - - - - - -
1. Withdrawal of surplus
reserves - - - - - - - - - -
2. Withdrawal of general risk
provisions - - - - - - - - - -
3. Distribution for owners
(shareholders) - - - - - - - - - -
4. Others - - - - - - - - - -
(V) Carrying forward
- -
internal owners’ equity - - - - - - - -
29
Amount in this report period
Owners’ equity attributable to the parent company
Items Less: Minority’s Total owners’
Paid-up capital Capital Special Surplus General risk equity equity
Treasury Retained profit Other
(Share capital) reserves reserve reserve provision
Stock
1. Capital reserves conversed
- -
to capital (share capital) - - - - - - - -
2. Surplus reserves conversed
to capital (share capital) - - - - - - - - - -
3. Remedying loss with
surplus reserve - - - - - - - - - -
4. Others - - - - - - - - - -
(VI) Reasonable reserve - - - - - - - - - -
1. Withdrawal in the report
period - - - - - - - - - -
Usage in the report period - - - - - - - - - -
(VII) Other - - - - - - - - - -
V. Balance at the end of the
551,347,947.00 444,161,710.87 32,673,227.01 -2,741,126,255.40 -1,712,943,370.52
- - - - -
Consolidated Statement on Changes of Owners' Equity(Cont)
Januray – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount last year
Owners’ equity attributable to the parent company
Items Paid-up Less: General Minority’s Total owners’
Capital Special Surplus Retained Other equity equity
capital (Share Treasury risk
reserves reserve reserves profit s
capital) Stock provision
I. Balance at the end of the last
year 479,433,003.00 458,695,975.55 - - 32,673,227.01 - -2,831,816,725.23 - - -1,861,014,519.67
Add: Changes of accounting
policy - - - - - - - - - -
Error correction of the last period - - - - - - - - - -
Others - - - - - - - - - -
II. Balance at the
479,433,003.00 458,695,975.55 - - 32,673,227.01 - -2,831,816,725.23 - - -1,861,014,519.67
III. Increase/ Decrease
71,914,944.00 -31,563,281.64 64,477,414.44 104,829,076.80
is listed with “-”) - - - - - -
(I) Net profit - - - - - - 64,477,414.44 - - 64,477,414.44
30
Amount last year
Owners’ equity attributable to the parent company
Items Paid-up Less: General Minority’s Total owners’
Capital Special Surplus Retained Other equity equity
capital (Share Treasury risk
reserves reserve reserves profit s
capital) Stock provision
(II) Other consolidated income - - - - - - - - - -
Subtotal of (I) and (II) - - - - - - 64,477,414.44 - - 64,477,414.44
(III) Owners’ devoted and
40,351,662.36 40,351,662.36
decreased capital - - - - - - - -
1. Owners’ devoted capital - - - - - - - - - -
2. Amount calculated into
-
owners’ equity paid in shares - - - - - - - - -
3. Others - 40,351,662.36 - - - - - - - 40,351,662.36
(IV) Profit distribution - - - - - - - - - -
1. Withdrawal of surplus reserves - - - - - - - - - -
2. Withdrawal of general risk
provisions - - - - - - - - - -
3. Distribution for owners
(shareholders) - - - - - - - - - -
4. Others - - - - - - - - - -
(V) Carrying forward internal
71,914,944.00 -71,914,944.00
owners’ equity - - - - - - - -
1. Capital reserves conversed to
71,914,944.00 -71,914,944.00
capital (share capital) - - - - - - - -
2. Surplus reserves conversed to
capital (share capital) - - - - - - - - - -
3. Remedying loss with surplus
reserve - - - - - - - - - -
4. Others - - - - - - - - - -
(VI) Reasonable reserve - - - - - - - - - -
1. Withdrawal in the report period - - - - - - - - - -
2. Usage in the report period - - - - - - - - - -
(VII) Other - - - - - - - - - -
IV. Balance at the end
551,347,947.00 427,132,693.91 32,673,227.01 -2,767,339,310.79 -1,756,185,442.87
- - - - -
31
Statement on Changes of Owners' Equity of Parent Company
Januray – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount in this report period
Paid-up Less:
Items Capital Specific Surplus General risk Retained Total owners’
capital (Share Treasury
reserves reserves provision profit equity
reserves Stock
capital)
I. Balance at the end of the last year 551,347,947.00 427,132,693.91 - - 32,673,227.01 - -2,698,131,623.44 -1,686,977,755.52
Add: Changes of accounting policy - - - - - - - -
Error correction of the last period - - - - - - - -
Others - - - - - - - -
II. Balance at the beginning of this
551,347,947.00 427,132,693.91 32,673,227.01 - -2,698,131,623.44 -1,686,977,755.52
year - -
III. Increase/ Decrease in this year
- 17,029,016.96 - - - - 26,975,990.16 44,005,007.12
(Decrease is listed with “-”)
(I) Net profit - - - - - - 26,975,990.16 26,975,990.16
(II) Other consolidated income - - - - - - - -
Subtotal of (I) and (II) - - - - - - 26,975,990.16 26,975,990.16
(III) Owners’ devoted and
17,029,016.96 17,029,016.96
decreased capital - - - - - -
1. Owners’ devoted capital - - - - - - - -
2. Amount calculated into owners’
-
equity paid in shares - - - - - - -
3. Others - 17,029,016.96 - - - - - 17,029,016.96
(IV) Profit distribution - - - - - - - -
1. Withdrawal of surplus reserves - - - - - - - -
2. Withdrawal of general risk
- - - - -
provisions - - -
3. Distribution for owners
(shareholders) - - - - - - - -
4. Others - - - - - - - -
(V) Carrying forward internal
- -
owners’ equity - - - - - -
1. Capital reserves conversed to
- - -
capital (share capital) - - - - -
2. Surplus reserves conversed to - - - - - - - -
32
Amount in this report period
Paid-up Less:
Items Capital Specific Surplus General risk Retained Total owners’
capital (Share Treasury
reserves reserves provision profit equity
reserves Stock
capital)
capital (share capital)
3. Remedying loss with profit
surplus - - - - - - - -
4. Others - - - - - - - -
(VI) Reasonable reserve - - - - - - - -
1. Withdrawal in the report period - - - - - - - -
2. Usage in the report period - - - - - - - -
(VII) Other - - - - - - - -
IV. Balance at the end of the report
551,347,947.00 444,161,710.87 32,673,227.01 - -2,671,155,633.28 -1,642,972,748.40
period - -
Statement on Changes of Owners' Equity of Parent Company(Cont)
Januray – June 2011
Prepared by Shenzhen China Bicycle Company (Holdings) Limited Unit: RMB Currency: CNY
Amount last year
Less:
Items Paid-up capital Capital Specific Surplus General risk Retained Total owners’
Treasury
(Share capital) reserves reserves reserves provision profit equity
Stock
I. Balance at the end of the last year 479,433,003.00 458,695,975.55 - - 32,673,227.01 - -2,764,252,248.12 -1,793,450,042.56
Add: Changes of accounting policy - - - - - - - -
Error correction of the last period - - - - - - - -
Others - - - - - - - -
II. Balance at the beginning of this
479,433,003.00 458,695,975.55 32,673,227.01 - -2,764,252,248.12 -1,793,450,042.56
year - -
III. Increase/ Decrease in this year
71,914,944.00 -31,563,281.64 - - - - 66,120,624.68 106,472,287.04
(Decrease is listed with “-”)
(I) Net profit - - - - - - 66,120,624.68 66,120,624.68
(II) Other consolidated income - - - - - - - -
Subtotal of (I) and (II) - - - - - - 66,120,624.68 66,120,624.68
(III) Owners’ devoted and
40,351,662.36 40,351,662.36
decreased capital - - - - - -
1. Owners’ devoted capital - - - - - - - -
33
Amount last year
Less:
Items Paid-up capital Capital Specific Surplus General risk Retained Total owners’
Treasury
(Share capital) reserves reserves reserves provision profit equity
Stock
2. Amount calculated into owners’
-
equity paid in shares - - - - - - -
3. Others - 40,351,662.36 - - - - - 40,351,662.36
(IV) Profit distribution - - - - - - - -
1. Withdrawal of surplus reserves - - - - - - - -
2. Withdrawal of general risk
- - - - -
provisions - - -
3. Distribution for owners
(shareholders) - - - - - - - -
4. Others - - - - - - - -
(V) Carrying forward internal
71,914,944.00 -71,914,944.00
owners’ equity - - - - - -
1. Capital reserves conversed to
71,914,944.00 -71,914,944.00 -
capital (share capital) - - - - -
2. Surplus reserves conversed to
- - - - - - -
capital (share capital) -
3. Remedying loss with profit
surplus - - - - - - - -
4. Others - - - - - - - -
(VI) Reasonable reserve - - - - - - - -
1. Withdrawal in the report period - - - - - - - -
2. Usage in the report period - - - - - - - -
(VII) Other - - - - - - - -
IV. Balance at the end of the report
551,347,947.00 427,132,693.91 32,673,227.01 - -2,698,131,623.44 -1,686,977,755.52
period - -
34
Shenzhen China Bicycle Company （Holding） Limited
Notes to Financial Statement
For Semi-annual 2011
I. Company Profile
1. Company History
According to the Approval Document SFBF (1991) No. 888 issued by the People’s Government of
Shenzhen, Shenzhen China Bicycle Company (Holdings) Limited (hereinafter referred to as the
Company) was reincorporated as the company limited by shares in November 1991. On 28
December 1991, upon the Approval Document SRYFZ(1991) No. 119 issued by Shenzhen Special
Economic Zone Branch of the People’s Bank of China, the Company got listed on Shenzhen Stock
Exchange. The Company reserves the business license for the enterprise legal person (QGYSZFZ
No.101165) [the registered number has been altered as 440301501122085] with the registered
capital of RMB551,347,947.00.
2. Business Scope and Operation
The Company belongs to the machinery manufacture industry and mainly engages in the production
and assembly of various bicycles and spare parts, components, parts, mechanical product, sport
machinery, fine chemicals, carbon fiber composites material, household electrical appliance and
affiliated components. (excluding the products within license range)
The Company is specialized in making the middle-top rank bicycles, the main brands are
EMMELLE and CHIMO, and various electrical bicycles.
The majority of its products were previously exported, however, the sales volume sharply declined
in recent years because of the antidumping litigation. Hence, the Company commences on the debt
reorganization and makes greater efforts to develop and research the new products, and creates a
range of electrical bicycles to occupy the domestic market.
3. Approval Issuer and Date for Financial Statement
The financial statement was deliberated and approved in the 7th Meeting of the 8th Session of the
Board held on 17 August 2011.
II. Main Accounting Policy, Accounting Estimate and Prior Errors
1. Compilation Basis of Financial Statement
The financial statement has been prepared under the Accounting Standard for Enterprise—Basic
issued on 15 February 2006 together with “Item 38”-Details of Accounting Standard, and
Application Guide of Accounting Standard for Enterprise issued subsequently, the Accounting
Standard for Enterprise—Explanation and other relevant regulations(together short for “Accounting
Standard for Enterprise”), and the regulation of Rules of Preparation on Information Disclosures for
Enterprise with Shares Listing No. 15- General Provision of Financial Report (Revised 2010) from
CSRC.
Ended as 30 June 2011, total assets of the Company amounting to RMB 150,424,997.29, the
liability were RMB 1,863,368,367.81 in total, net assets amounting to RMB -1,712,943,370.52
which seriously insolvency. Management of the Company adopts the measures listed in Note X.2
carried in this report, along with the continuously development for debt and assets restructuring, the
business environment, business status and sustainable ability in business achieved a further
improvement, the financial statement for first half year of 2011 prepared based on the sustainable
business was appropriated.
2. Announcement for Following the Enterprise Accounting Standards
The financial statement complied by the Company pursuant to the foresaid compilation basis truly
and fully reflects such related information as financial status as of 30 June 2011, operation
achievement and cash flows of the Company for semi-annual 2011.
35
3. Accounting Period
The company adopts Gregorian calendar, namely each 1 January to 31 December should be one
fiscal year.
4. Standard Book-keeping Currency
The Company adopts Renminbi(RMB) as the standard book-keeping currency.
5. Accounting Treatment Method for Business Combinations under the Same Control and not
under the Same Control
(1) The business combination under the same control: The assets and liabilities that obtains in a
business combination shall be measured on the basis of their carrying amount in the combined party
on the combining date. As for the balance between the carrying amount of the net assets obtained by
the combining party and the carrying amount of the consideration paid by it (or the total par value
of the shares issued), the additional paid-in capital shall be adjusted. If the additional paid-in capital
is not sufficient to be offset, the retained earnings shall be adjusted. The direct cost for the business
combination, including the expenses for audit, assessment and legal services, shall be recorded into
the profits and losses at the current period. Where a relationship between a parent company and a
subsidiary company is formed due to a business combination, the parent company shall, on the
combining date, prepare a consolidated balance sheet, a profit statement and a cash flow statement.
If the accounting policy adopted by the combined party is different from that adopted by the
combining party, the assets and liabilities of the combined party (parties) shall be measured on the
basis of the post-adjustment carrying amount. The consolidated profit statement shall include the
incomes, expenses and profits of the combining party incurred from the beginning of the current
period to the combining date.The net profits of the combined party which has been realized prior to
the combination shall be reflected through an item separately presented in the profit statement. The
consolidated cash flow statement shall include the cash flow of the parties to the combination from
the beginning of the current period to the combining date.
(2) Business Combination Not under the Same Control: The combination costs shall be the fair
values, on the acquisition date, of the assets paid, the liabilities incurred or assumed and the equity
securities issued by the acquirer in exchange for the control on the acquiree, as well as all relevant
direct costs incurred to the acquirer for the business combination shall also be recorded into the cost
of business combination. The acquirer shall, on the acquisition date, measure the assets given and
liabilities incurred or assumed by an enterprise for a business combination in light of their fair
values, and shall record the balances between them and their carrying amounts into the profits and
losses at the current period. The acquirer shall recognize the positive balance between the
combination costs and the fair value of the identifiable net assets it obtains from the acquiree as
goodwill. The acquirer shall reexamine the measurement of the fair values of the identifiable assets,
liabilities and contingent liabilities it obtains from the acquiree as well as the combination costs, If,
after the reexamination, the combination costs are still less than the fair value of the identifiable net
assets it obtains from the acquiree, it shall record the balance into the profits and losses of the
current period. Where a relationship between a parent company and a subsidiary company is formed
due to a business combination, the parent company shall prepare a combined balance sheet on the
acquisition date, which shall present the identifiable assets, liabilities and contingent liabilities
acquired in the combination at their fair values.
6. Preparation of the consolidated financial statement
(1) A. The scope for the consolidated financial statements shall be confirmed based on the principle
of control. The consolidated financial statements shall be compiled based on the financial
statements of the Company and all related subsidiaries incorporated into the scope of consolidated
financial statements. The long-term equity investment to the subsidiary shall be adjusted according
to the equity method, and then all related investments and transaction between the Company and
related subsidiaries in the scope of the consolidated financial statement are offset, besides, the
36
minority interest income and rights are consolidated.
B. In case of any inconsistency of the accounting policy between the subsidiary and the head office,
the accounting policy adopted by the head office shall prevail.
C. The consolidation for the subsidiary acquiring from the enterprise acquisition under the same
control shall be deemed that such consolidation has been occurred at the early stage of the current
period, which assets, liabilities, operation achievement and cash flow shall be incorporated into the
consolidated financial statement.
D. As for the consolidation under the same control, the net profits and loss suffered by the
reorganized party shall be recorded as the on-recurring profit and loss and independently itemized
in the financial statements.
E, As for the reorganization of non-enterprise consolidation under the same controller, the reference
profit statement shall be compiled from the beginning of the consolidation period in case that total
assets at the end of previous fiscal year, or the operating income or the total profit of the
reorganized party for the previous fiscal year reaches or exceeds 20% of the reorganizing party
before the reorganization.
F. As for the subsidiary acquiring from the enterprise acquisition not under the same control, it
requires adjusting some financial statements based on the fair value of the identified net assets on
the acquisition day when compiling the consolidated financial statements.
(2) Concerning the equity of same subsidiary buy than sell or sale than buy in successively two
fiscal years, relevant accounting treatment should be disclosed.
7. Confirmation Standard for Cash and Cash Equivalent
Cash refers to cash on hand and deposits that are available for payment at any time.
Cash equivalent refers to short-term (generally refers to cash equivalent ondue within three monthes
since purchased day) and highly liquid investments that are readily convertible to known amounts
of cash and which are subject to an insignificant risk of change in value.
8. Foreign Currency Transactions and Foreign Currency Statement Translation
A. Foreign currency transactions
The occurred foreign currency transactions should be converted into Renminbi with taking spot
exchange rate at the transaction date as the exchange rate. The approximate spot exchange rate
refers to the exchange rate at the beginning of current month.
The Company shall, on the balance sheet date, treat the foreign currency monetary items and
foreign currency non-monetary items in accordance with the following provisions:
a. The foreign currency monetary items shall be translated at the spot exchange rate on the balance
sheet date. The balance of exchange arising from the difference between the spot exchange rate on
the balance sheet date and the spot exchange rate at the time of initial recognition or prior to the
balance sheet date shall be recorded into the profits and losses at the current period.
b. The foreign currency non-monetary items measured at the historical cost shall still be translated
at the spot exchange rate on the transaction date, of which the amount of functional currency shall
not be changed.
c. The foreign currency non-monetary items measured at the fair value shall be translated at the spot
exchange rate on the day for the confirmation of the fair value, the balance between the Renminbi
and the original standards currency shall be recorded into the profits and losses at the current period
as the changes of the fair value.
B. Translation of foreign currency financial statements
When translating the financial statements on the overseas businesses, the Company shall comply
with the following provisions:
a. The asset and liability items in the balance sheets shall be translated at a spot exchange rate on
the balance sheet date. Among the owner's equity items, except the ones as "undistributed profits",
others shall be translated at the spot exchange rate at the time when they are incurred.
b. The income and expense items in the profit statements shall be translated at the spot exchange
rate of the transaction date, or at a spot exchange rate which is determined through a systematic and
37
reasonable method and is approximate to the spot exchange rate of the transaction date.
The balance arisen from the translation of foreign currency financial statements in compliance with
the aforesaid Items (a) and (b) shall be presented separately under the owner's equity item of the
balance sheets.
9. Financial Instruments
A. Classification of the financial assets
The financial assets covers the financial assets measured at the fair value and its changes was
recorded into the profits and losses at the current period (including the tradable financial assets and
its changes recording into the profits and losses at the current period), held-to-maturity investment,
loan and account receivables, saleable financial assets.
B. Measurement of Financial Assets:
a. The financial assets shall be measured at the fair value at the time of initially reorganization. The
relevant expenses for the financial assets measured at the fair value and its changes recording into
the profits and losses at the current period shall be directly recorded into the profits and losses at the
current period; and the relevant expenses for other financial assets shall be recorded into the
initially confirmed amount.
b. The enterprise made subsequent measurement on its financial assets according to their fair values,
and may not deduct the transaction expenses that may occur when it disposes of the said financial
asset in the future. However, those under the following circumstances shall be excluded:
1/ The investments held until their maturity, loans and accounts receivable shall be measured on the
basis of the post-amortization costs by adopting the actual interest rate method;
2/ The equity instrument investments for which there is no quotation in the active market and whose
fair value cannot be measured reliably, and the derivative financial assets which are connected with
the said equity instrument and must be settled by delivering the said equity instrument shall be
measured on the basis of their costs.
C. Confirmation of financial assets’ fair value:
a. As for the financial assets for which there is an active market, the quoted prices in the active
market shall be used to determine the fair values thereof;
b. Where there is no active market for financial assets, the Company adopts value appraisal
techniques to determine its fair value. The result obtained by adopting value appraisal techniques
shall be able to reflect the transaction prices that may be adopted in fair dealings on the value
appraisal day.
D. Transfer of financial assets
If the Company has transferred all or part of the risks and rewards related to the ownership of the
financial asset to the transferee, these financial assets shall be stopped recognizing, where if it
retained nearly all of the risks and rewards related to the ownership of the financial asset, it shall not
stop recognizing these financial assets.
E. Impairment of financial assets:
The Company carries out an inspection, on the balance sheet day, on the carrying amount of the
financial assets other than those measured at their fair values and of which the variation is recorded
into the profits and losses of the current period. Where there is any objective evidence proving that
such financial asset has been impaired, an impairment provision shall be made. The objective
evidences that can prove the impairment of a financial asset shall include:
a. A serious financial difficulty occurs to the issuer or debtor;
b. The debtor breaches any of the contractual stipulations, for example, fails to pay or delays the
payment of interests or the principal, etc.;
c. The Company makes any concession to the debtor which is in financial difficulties due to
economic or legal factors, etc.;
d. The debtor will probably become bankrupt or carry out other financial reorganizations;
38
e. The financial asset can no longer continue to be traded in the active market due to serious
financial difficulties of the issuer;
f. Any seriously disadvantageous change has occurred to technical, market, economic or legal
environment, etc. wherein the debtor operates its business, which makes the investor of an equity
instrument unable to take back its investment;
g. It is impossible to identify whether the cash flow of a certain asset within a certain combination
of financial assets has decreased or not. But after making an overall appraisal according to the
public data available, it is found that the predicted future cash flow of the said combination of
financial assets has indeed decreased since it was initially recognized and such decrease can be
measured, ;
h. Where the fair value of the equity instrument investment drops significantly or not
contemporarily; and
i. Other objective evidences showing the impairment of the financial asset.
F. Measurement of impairment of financial assets
a. The impairment test is not required for the financial assets measured at the fair value and its
changes recording into the profits and losses of current period;
b. Measurement of the impairment of held-to-maturity investment: the impairment provision shall
be made according to the balance that the future cash flow shall be lower than the ending book
value;
c. Confirmation standards and provisions for bad debt of accounts receivables: An impairment test
shall be made on the financial assets with significant single amounts. If any objective evidence
shows that the accounts receivable has been impaired, the impairment-related losses shall be
recognized to prepare the provisions for bad debts according to the balance between the future
present value and the book value. With regard to the financial assets with insignificant single
amounts, if any objective evidence shows that the accounts receivable suffers no impairment, the
account age analysis method shall be adopted, and withdraw and confirm the impairment loss
according to the account age and specified ratio; With regard to the financial assets with
insignificant single amounts, an independent impairment test may be carried out, or they may be
included in a combination of financial assets with similar credit risk features so as to carry out an
impairment-related test. As for the account receivable without any impairment, after the
independent impairment test, the impairment loss shall be made according to the account age and
the ratio as stipulated.
d. Judgment of impairment of saleable financial assets: Provided that the fair value of saleable
financial asset has great depreciation, or takes into any related factors account, it shows that such
depreciation is permanent, it shall be recognized the impairment.
10. Account Receivable
(1) Confirmation and Method for Provisions for Bad Debts of Single Significant Amount
Standards for the determination on account receivable
with single significant amount based on business scale,
Determine basis or amount standards for Single
business nature and settlement status of the clients:
Significant Amount
The account receivable over RMB 5 million(including
RMB 5 million) at period-end
An impairment test shall be made on the financial
assets with significant single amounts. The
Withdawal method on single significant amount and impairment-related losses shall be recognized to
with bad bedt provision accrued for single item prepare the provisions for bad debts according to the
balance between the future present value and the book
value.
(2) Bad debt provision for account receivable withdrawal by combination:
Basis for combination determine: characteristic of credit risk
Item Accrued method
Age group—account receivable with same book age Age analysis method: determined the impairment losses
39
ownes similar characteristic in credit risk and bad debt provision accrued by age and regulated
withdrawal proportion of the account receivable
Adopt age analysis method for bad debt provision withdrawal in combination:
Accrued ratio for account Accrued ratio for other account
Age
receivable(%) receivable(%)
Within one year (one year included) 0.3 0.3
1-2 years 0.3 0.3
2-3 years 0.3 0.3
Over 3 years 100 100
(3) Account receivable with minor single amount but with withdrawal bad debt provision for single
item:
Reasons of withdrawal bad debt
Clearly evidence shows that the account hard to recover
provision for single item
Withdrawal method for bad debt Recognized impairment loss and accrued the bad debt provision according to
provision the balance between future cash flow on account receivable and its book value
11. Inventory
(1) Classification of inventory
The inventory of the Company refers to such seven classifications as the raw materials, product in
process, goods on hand, wrappage, low value consumables, materials for consigned processing and
goods sold.
(2)Valuing of the delivered inventory
The Company adopts the historical cost for obtaining or the planned cost to value the inventory
according to its actual situation, and weighted average method for the issued inventory.
(3) Confirmation of net realizable value for the inventory and provision for inventory impairment
The net realizable value for the inventory refers to, in the course of general operation, the estimated
amount with deducting the estimated cost, estimated sales expense and related taxes from the
estimated sales price.
Provision for inventory impairment: Based on making an overall check of the inventory at the
middle and end of the year, the Company measures the whole or partial out-of-dated inventory or
the inventory with extremely lower price according to the cost or the net realizable value, whichever
is lower; and withdraws the impairment provisions for the single inventory according to the balance
between the net realizable value and the cost and recorded into the profits and losses of current
period. In addition to the holding purpose and the price and cost fluctuation as of the balance sheet
date, the Company shall take into the future event account when confirming the net realizable value.
(4)Rake inventory
In addition to the periodic inventory system for the products, the Company adopts the perpetual
inventory system for other inventories.
(5) Amortization method for the low-value consumables and wrappage
Low-value consumables:
The Company adopts one-off amortization method to amortize the low-value consumables
Wrappage:
The Company adopts one-off amortization method to amortize the wrappage at the time of receipt.
12. Long-term equity investment
Determination of investment cost
A. Recognized investment cost by followed for the long-term equity investment fromed by
enterprise merger:
a.Merger of the units controlled by the same entity is effected through payment in cash, non-cash
asset transfer or debt transfer. On the date of the merger, the book value of the equities of the units
merged is made the initial investment costs of the long-term equipty investment. The capital surplus
is adjusted on the basis of the difference between the initial costs of long-term equity investment,
40
payment in cash, non-cash assets transferred and the debts. In case the capital surplus is not enough
for deducting, the retained earnings will be adjusted.
In case the units being merged through issuing equity securities, the book value of equity of units
being merged is made the initial costs of long-term equity investment on the date of merger. The
total face value of the securities issued is regarded as equity capital. The capital surplus is adjusted
on the basis of the difference between the initial costs of long-term equity investment and the facel
value of the securities issued. In case the capital surplus is not enough for deducting, the retained
earnings will be adjusted.
b. In case of merger that is not effected under the same controlling entity, the merger costs
determined by the following regulations is made the initial investment costs:
①In case the merger is effected through one-time swap, the merger cost is the the assets, debts or
equity securities paid by the purchaser on the date of merger.
②In case of a merger effected through a series of transactions, the merger cost is the total of all the
separate transactions.
③The related costs incurred by the purchaser for the merger is all charged to the current gains and
losses.
④In case the merger contract or agreement have any regulation that may influence the cost of
merger in the future, or it is predicted on the purchasing date that the merger costs will definitely be
influenced in the future, the influence is charged to the merger costs.
B.Beside the long-term equity investment produced by merger, the long-term equity investment
produced through other means shall be determined of its initial costs according to the following
regulations:
a.The initial investment costs of the long-term equity investment produced through payment in cash
is determined on the basis of the actual payment for the purchase. The initial investment cost
includes the immediately related expenses, taxe or other costs necessary for the long-term equity
investment.
b.In case of long-term equity investment produced through issuing equity securities, the fair value
of the equity securities is initial investment cost.
c.In case of input as long-term equity investment by investors, the value agreed upon in the
investment contract or agreement is the initial investment cost; but, except the case that the value is
not fair in the contract or agreement.
d.In case of long-term equity investment produced through commercially-natured non-monetary
assets transactions, the fair value of the incoming long-term equipty investment and the related
taxes is the initial investment cost. In case of long-term equity investment produced through
non-commercially-natured non-monetary assets transactions, the book value of the outgoing assets
and the related taxes is the initial investment cost.
e. Long-term equity investment obtained through debt reorganization, recognized investment cost
based on fair value and relevant taxes.
(2)Subsequent reckoning as well as profits and loss determination method
A.Costing method is applied for the long-term equity investment in case the company has a control
over the invested unit, or, the company cann’t co-control or has no material influence on the unit
and there is no quotation on the market or the fair value is reliable.
The long-term equipty investment accounted by cost method is priced on the basis of the initial
investment cost. When adding or withdrawing the investment, the cost of the long-term equity
investment is adjusted.
B.Equity method is applied for the case the company can co-control or has material influence on the
invested unit.
In case the initial investment cost of the long-term equity investment is greater than fair value of the
net descinible assets that should be enjoyed from the invested unit at the time of investment, the
41
initial investment cost of the long-term equipty investment is not to be adjusted. In case the initial
investment cost of the long-term equity investment is less than fair value of the net descinible assets
that should be enjoyed from the invested unit at the time of investment, the difference should be
charged to the profits or loss of the term, and at the same time, the cost of long-term equity
investment should be adjusted.
After the company obtains a long-term equity investment, the investment profits or losses shall be
determined, and the book value of the lont-term equity investment shall be adjusted, according to
the sharable net profits or losses created at the invested unit. The book value of the long-term equity
investment shall be reduced according to the sharable profits or cash interests published by the
invested unit. In case the net losses of the invested unit is confirmed by the company, the book
value of the long-term equity investment and other long-term interests of the invested company can
be reduced not beyond the limit of 0, except the case where the company undertakes additional
responsibilities for loos. In case the invested unit reaps profits thereafter.
When determining the entitled share of the net profits or loss of the invested unit, the net profits or
loss of the invested unit is adjusted on the basis of the fair discernible value of various assets of the
invested unit. If the accounting policies and term of the invested unit is not the same as those of the
investing unit, those of the investing units prevail, on the basis of which, the financial statements of
the invested unit are adjusted and the investment profts or losses are determined.
C.For the long-term equity investment, the difference between the book value and actually obtained
payment shall be charged to the profits and loss of the term.
(3)The basis for the co-control over and material imfluence on the invested unit
Co-control refers to a contract-based joint control over a certain ecomomic activity, which is valid
only when unanimously agreed upon by the investors with control right to the important financial
and operation decisions for the activity.
Material influence refers to having right to take part in, but cannot control or co-control, the
financial or operation decision making processes in an enterprise.
(4)Depreciation test method and depreciation allowance
The long-term equity investment shall be checked on the date of the balance sheet to determine if
the long-term equity investment has suffered any depreciation. If there is sign of depreciation for
worsening operation of the company, then estimates shall be made of the recoverable amount. If the
estimate indicates that the recoverable amount for the long-term equity investment is lower than the
book value, then the book value is reduced to the recoverable amount, where the reduction amount
is charged to asset depreciation loss, the profits or losses of the term, and the corresponding
long-term investment depreciation allowance. Once the long-term investment depreciation loss is
determined, it will not be transferred back in the subsequent period of time.
13.Investment real estate
investment real estate refers to the real properties for the purpose of rental or value increase or both.
1. Investment real estate is measured according to the initial cost.
(1) Cost of investment real estae from purchasing, including the price of purchase, relevant taxes
and other expenditures attributable to this assets.
(2) Cost of investment real estate from self-construction, consist of the necessary expenditures that
occurred before the useful statuse that predicted.
(3) Cost of investment real estae obtained from other meas, recognized cost according to relevant
accounting standards.
2. Follow-up measurement
The follow-up expenses that are related to investment real estate, if the economic interests related to
the assets are is likely to inflow cost and its costs can be reliably measured, shall be included in the
cost of investment real estate; or else, reconkoned into current gains and losses while occurred.
42
The Company adopts cost model to have follow-up measurements on the investment real estate at
balance sheet date.
3. Depreciation and impairment provision
Found in the “Execution of depreciation and impairment provision for fixed assets” under Note 14
carried in this report.
14.Fixed assets
(1) Fixed assets confirmation conditions
Fixed assets refer to the tangible assets for production of products, provision of labor, lease or
operation, and with a service life in excess of 1 finanical year. The fixed assets shall be evaluated
initially at the actual costs. Fixed assets’ related financial benefits shall flow into the enterprise and
their value can be measured.
(2) Depreciation methods for various fixed assets
years of yearly depreciation
Categories scrap value rate(%)
depreciation(years) rate(%)
Housing buildings 20 10 4.5
Machines and equipment 10 10 9
Office equipment 5 10 18
Electronic equipment 5 10 18
Transportation equipment 5 10 18
Other equipment 5 10 18
(3) Depreciation test method and depreciation allowance method for fixed assets
It is necessary to judge if the fixed assets have had any depreciation on the date of the balance sheet.
If their market value goes down steadily, or technologically old or damaged, or laying idle for long
time, the recoverable amount of the fixed assets shall be estimated. If the recoverable amount is
lower thant their book value, then the book value of the fixed assets shall be reduced to the
recoverable amount. The reduction shall be charged to asset depreciation allowance and the loss and
profits of the term. When the depreciation of the fixed assets is confirmed, it will not be transferred
back in the subsequent time.
(4) Determination and evaluation method for fixed assets financed by leasing
If all the risks and remunerations related to a certain fixed asset financed by leasing have been
materially transferred, the company will regard it as a case of fixed asset financed by leasing. For
the assets financed by leasing, the book value of the assets financed by leasing shall be the fair
value of the assets on the date of leasing or the lowest price for leasing, whichever is lower, plus the
initial costs of the leasing project. The lowest leasing fees is the book value of the long-term
accounts payable, their difference is being regarded as fiancing costs. The unconfirmed financing
costs are amortized in the leasing term with the actual interest rate method. The depreciation and
depreciation rate shall be determined on the basis of the leasing term and the estimated scrap value.
15. Project under Construction
A. Calculation Method of Project under Construction
The project under construction includes the preparation before execution, construction engineering,
installation work, technical modification work and big repair work during the execution, etc. It can
be calculated upon the sub-project according to the expenditure actually incurred and transferred
into the fixed asset when the project reaches the scheduled usable status. The borrowing cost
(including loan interest, amortization of premium and exchange loss or gain, etc) relevant with the
project under construction can be counted into the cost of the engineering before the relevant
engineering reaches the scheduled usable status; while it can be counted into the financial expense
of the current period after the relevant engineering reaches the scheduled usable status.
B. Depreciation Reserves of Project under Construction
The project under construction shall be fully inspected on the date of Balance Sheet to judge
43
whether there is depreciation probably incurring on it. If so, (1) the project under construction shall
be stopped for a long time and shall not be re-started within three years upon prediction; (2) If the
project under construction is out of date in its performance and technology, and the economic
benefit has great uncertainty, it can recover its amount upon estimation. According to the calculation
result of recoverable amount, if the recoverable amount of the project under construction is lower
than the carrying value, then the carrying value of the project under construction shall be decreased
to the recoverable amount. The decreased amount is defined as the loss on asset depreciation and
counted into the loss or gain of the current period. Meanwhile, corresponding depreciation reserves
for the project under construction shall be accrued. The depreciation loss of the project under
construction shall not be transferred back during the future accounting year once its confirmation.
16. Borrowing Costs
A. The borrowing costs incurred, which can directly belong to the purchase and production of assets
in accordance with the capitalization can be capitalized and counted into relevant capital cost; and
the other borrowing costs can be counted into the loss or gain of the current period according to the
incurred amount. And the borrowing costs can be capitalized if meeting the following conditions:
a. The asset expenditure has been incurred, which includes the paid cash used to purchase or
produce the assets in accordance with the capitalization conditions, and the expenditure incurred
during transferring the non-cash assets or bearing the debt with interest;
b. The borrowing costs has been incurred;
c. The purchase or production activities have been started, which are necessary to make the assets
reach the scheduled usable or vendible status.
B. The borrowing costs stop the capitalization when the purchased or produced assets in accordance
with the capitalization reach the scheduled usable or vendible status. And the borrowing costs
incurred after the assets in accordance with the capitalization conditions reach the scheduled usable
or vendible status, are confirmed to be the expenditures according to the incurred amount and
counted into the loss or gain of the current period.
17. Intangible Assets
(1) The intangible assets refer to the identifiable and non-currency assets without physical form
owned or controlled by the enterprise, including the patents and land tenure, etc.
(2) The intangible assets are valuated according to the actual costs during the acquirement.
(3) The intangible assets, of which the service life has been defined, can be amortized with
straight-line method during the period since the usable time, and counted into the loss or gain of the
current period; the intangible assets, of which the service life has been not defined, are not
amortized. The company shall check the service life and amortization method of the intangible
assets at the end of the year. If the service life and amortization are not the same as before, then they
shall be changed.
(4) Depreciation Reserves of Intangible Assets
At the end of the period, check each kind of intangible assets, which can be predicted to bring the
future economic benefits to the company, one of the following circumstances shall exist: (1) A
certain intangible asset has been replaced by other new technology, which makes the ability to
create the economic benefits for the company greatly influenced; (2) The market price of a certain
intangible asset greatly decreases at the current period and shall not restore within the residual
amortization period upon prediction; (3) A certain intangible asset has surpassed the limit of legal
protection, but it remains part of use value. It can recover the amount upon estimation. According to
the calculation result of recoverable amount, if the recoverable amount is lower than the carrying
value, then the carrying value of intangible asset shall be decreased to the recoverable amount. The
decreased amount is defined as the loss on asset depreciation and counted into the loss or gain of the
current period. Meanwhile, corresponding depreciation reserves shall be accrued; (4) For a certain
intangible asset, which has incurred the depreciation reserves upon enough evidence, and if the
recoverable amount is lower than the carrying value upon estimation, the balance between them
44
shall be accrued for depreciation reserves of intangible assets. The depreciation loss of intangible
assets shall not be transferred back during the future accounting year once its confirmation.
18. Long-term Expenses to be Amortized
A. Long-term expenses to be amortized refer to the various expenses with the allocated time limit
for the current period and future each period over one year.
B. Long-term expenses to be amortized are valuated according to the actual cost during the
acquirement. The promotion expense is counted into the loss or gain of the current period when the
incurrence; the decoration expense of the operating leased fixed assets is amortized on average
during the lease period; and other long-term deferred expenses are amortized on average during the
profitable period. For the long-term deferred expenses which cannot bring predicated economic
benefits during the accounting period, the company shall transfer the all amortized values without
amortization into the loss or gain of the current period.
19. Estimated Liabilities
A. The duty or the duty relevant with the matter shall be confirmed as the estimated liability,
complying with the following conditions: the duty is the current duty assumed by the company; the
performance of the duty may cause the economic benefit flows out of the enterprise; the amount of
the duty can be reliably counted;
B. For all or part expenditures required for the payment of the estimated liabilities, which are
expected to be compensated by the third party, and when the compensation amount can be received
only once it is basically defined, then the asset can be singly confirmed. Meanwhile, the
compensation amount confirmed for the asset through the single calculation shall not surpass the
corresponding carrying amount.
20. Revenue
A. Revenue of commodity sales
The enterprise has transferred the main risk and remuneration on the ownership of the commodities
to the buyer; the enterprise doesn’t reserve the continuous management right in connection with the
ownership and executes effective control on the sold commodities. The revenue amount can be
reliably counted; relevant economic interest may flow out of the enterprise; and the relevant
incurred cost or cost to be incurred can be reliably counted.
B. Revenue from labor service
For the labor service which starts and ends within the same accounting year, the revenue shall be
confirmed when it ends; if the labor service which starts and ends not in the same accounting year,
the relevant revenue shall be confirmed according to the percentage of the completion under the
condition that the result to provide labor trade can be reliably estimated.
C. Revenue from abalienating the right to use assets
The revenue from abalienating the right to use assets includes interest revenue and operating cost
revenue. The former is calculated and defined according to the time when others use the monetary
fund of the company and the actual interest rate; while the latter is calculated and defined according
to the charging time and method negotiated according to the relevant contract or agreement.
21. Government Grants
Government grants include financial allocation, financial discount, tax rebate and free assignment
of non-currency assets. The government grants received by the company and relevant with the
assets are confirmed as the deferred income, which is counted into the loss or gain of each period
within the service life of the asset since it reaches the scheduled usable stats. And the deferred
income balance shall be transferred into the loss or gain of asset disposal of the current period if it is
sold, transferred, rejected or destroyed before the service life ends. The government grants received
relevant with the income and used to compensate the relevant cost or loss afterwards are confirmed
as the deferred income, which shall be counted into the loss or gain of the current period when
45
confirming the relevant costs; and those used to compensate the incurred relevant cost or loss shall
be directly counted into the loss or gain of the current period.
22. Deferred tax assets / deferred income tax liabilities
A.The confirmation of deferred income tax assets
a.Our company is likely to take the deductible temporary differences taxable income used to be
deducted as the limit, confirming the deferred tax asset is produced by the deductible temporary
differences. However, when the transactions possess the following characteristics at the same time,
the deferred tax asset produced due to the initial confirmation of assets or liabilities are not
confirmed:
1/ the transaction is not a corporate combination;
2/ Transactions affect neither the accounting profit nor taxable income (or deductible loss).
b.Our company , subsidiaries , affiliated companies and joint venture companies invest the related
deductible temporary differences, while meeting the following conditions, confirming the
corresponding deferred income tax assets:
1/ the temporary differences in the foreseeable future is likely to be reversed;
2/ the taxable income used for deductible temporary differences is likely to be gained in the future.
c.Our company offsets the deductible losses and tax credits which can be carried forward for future
years, taking the future taxable income which can be used to deduct the deductible losses and tax
credits as the limit, and confirming the corresponding deferred income tax assets.
B.The confirmation of deferred income tax liabilities
Besides the following deferred income tax liabilities, our company confirms all deferred income tax
liabilities produced by the taxable temporary differences:
a.The initial confirmation of creditworthiness;
b.The assets or liabilities which meets the following characteristics of the transactions generated is
confirmed:
1/ the transaction is not a corporate combination;
2/ Transactions affect neither the accounting profit nor taxable income (or deductible loss).
c.Our company , subsidiaries , affiliated companies and joint venture companies invest the related
deductible temporary differences, while meeting the following conditions:
1/ Investment companies can control the timing of the reversal of temporary differences;
2/ the temporary differences is unlikely to be reversed in the foreseeable future.
23.the main accounting policies, changes of accounting estimates
No changes on accounting policies and estimation in the period.
24. prior period correction of accounting errors
No accounting error correction is available during the period of this report
25. Other preparation method on main accounting policies, accounting estimation and
fiannial statement
No other preparation for a accounting policies, accounting estimation and fiannial statement of the
Company.
III. Taxes
1. Mai tax category and tax rate
Tax category Tax calculation evidence Tax rate
Sales income, and income from processing,
Value added tax maintenance, making repairs and supplying 17%
replacements, and labor service
Sales tax Taxable labor income 5%
tax for maintaining and Payable amount of value-added tax, 7%
46
building cities consumption tax and business tax
Payable amount of value-added tax,
Educational surtax 3%, 5％
consumption tax and business tax
Business income tax * Taxable income 24%
*According to the Notification on Implementing Transitional Preferable Policy about Business Income Tax [GF
(2007) No. 39] issued by the State Council on Dec. 26, 2007, the preferential policy about business income tax
enjoyed by enterprises according to original tax laws, administrative rules, and documents with effect of
administrative force shall be transited according to the following measures: Since Jan. 1, 2008, original enterprises
enjoying low tax preferential policy shall be gradually transited to legal tax rate within 5 years after the execution
of new tax law. Where, enterprises enjoying business income tax 15% shall execute the tax rate 18%, 20%, 22%,
24%, and 25% respectively in 2008, 2009, 2010, 2011, and 2012. Therefore, the business income tax executed by
the enterprise in 2010 was actually 24%.
47
IV. Business Combination and Consolidated Financial Statements
1. Subsidiaries
(1) Subsidiaries obtained by means of establishment or investment, etc.
Unit: RMB
Balance after that
the loss of current
Balance of Amount for period shared by
other items offsetting the minor shareholders
actually Consolidated gain and loss of and offset with
Actual amount proportion Proportion Minor
Registration Business Registered forming the report minor parent company
Full name Type Business scope subscribed at the of shares of voting shareholders’
place nature capital net statement or shareholders in owner’s equity
end of period held power equity
investment in not the minor exceeds the shares
the shareholders’ owned by minor
subsidiaries equity shareholders in the
subsidiary at the
beginning of period
Shenzhen
Anjule Realty Wholly-owned RMB 2 Self-owned RMB2,000,00.00 - 100% 100% Yes - - -
Shenzhen property
Management subsidiary million realty
Co., Ltd. management
China Bicycle Wholly-owned Hong Kong Bicycle HK$ 0.02 Trade and HKD20,000.00 - 100% 100% Yes - - -
(International) subsidiary million manufacturing
Co.,
HK$ 5
China Bicycle Bicycle and
Controlling Hong Kong Bicycle HKD5,000,000.00 - 99% 99% Yes - - -
(Hong Kong) parts
subsidiary million
Co., Ltd. distribution
Shenzhen
Bicycle and
Emmelle Controlling Shenzhen Bicycle RMB 2 RMB1,400,000.00 - 70% 70% Yes -
parts
Industry Co., subsidiary million distribution
Ltd.
(2) The Company has no subsidiary obtained from combination with enterprises under the same control.
(3)The Company has no subsidiary obtained from combination with enterprises not under the same control.
48
2. No business entity of control right formed by special purpose subject or by means of trusted business or
leasing etc.
3. No changes in the consolidation scope in the period.
4. No enterprise mergered under same control occurred in the period.
5. No enterprise mergered under different control occurred in the period.
6. No subsidiary losses in period by means of equity for sale without contol rights held.
7. No reverse purchase occurred in the period.
8. No obsorbtion emerger occurred in the period.
V. Notes to Items in Consolidated Financial Statements
1. Monetary fund
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
Amount in Amount in
Conversion Amount in Conversion Amount in
foreign foreign
rate RMB rate RMB
currencies currencies
Cash:
RMB 122,127.48 1.00 122,127.48 164,956.42 1.00 164,956.42
HK Dollar 1,894.30 - 1,773.76 1,894.30 - 1,773.76
US Dollar 1.25 - 9.13 1.25 - 9.13
Subtotal - - 123,910.37 - - 166,739.31
Bank deposit:
RMB 19,195,442.27 1.00 19,195,961.38 16,611,335.30 1.00 16,611,335.30
HK Dollar 773,490.97 0.85 658,186.67 773,490.97 0.85 658,186.67
US Dollar 46,927.13 6.83 320,512.30 46,927.13 6.83 320,512.30
Subtotal 20,174,660.34 17,590,034.27
Total 20,298,570.72 17,756,773.58
2. Notes receivable
(1) Classification of notes receivable
Unit: RMB Currency: CNY
Category Amount at the end of period Amount at the beginning of period
Bank acceptance 1,245,768.00 2,619,699.00
(2) Notes receivable without hypothecation of the Company at the end of period
(3) No notes transferred from account receivable due to failue performance of issuer at end of this
period.
3. Accounts receivable
(1) Exposure of accounts receivable by category:
Unit: RMB Currency: CNY
Amount at the end of period
Book balance Bad debt provision
Category
Proporti Proportion(
Amount Amount
on(%) %)
Account receivable with single major amount
but withdrawal bed debt provisio for single - - - -
item
Account receivable withdrawal bad debt 1,038,104,507. 1,037,051,818.
100.00 99.90
provision by age combination 49 47
Account receivable with single minor amount
but withdrawal bed debt provisio for single - - - -
item
1,038,104,507. 1,037,051,818.
Total 100.00 99.90
49 47
49
Unit: RMB Currency: CNY
Amount at the beginning of period
Book balance Bad debt provision
Category
Proporti Proporti
Amount Amount
on(%) on(%)
Account receivable with single major amount
and withdrawal bed debt provisio for single - - - -
item
Account receivable withdrawal bad debt
1,038,181,894.70 100.00 1,036,449,071.72 99.83
provision by age combination
Account receivable with single minor amount
but withdrawal bed debt provisio for single - - - -
item
Total 1,038,181,894.70 100.00 1,036,449,071.72 99.83
Interpretation to the category of accounts receivable:
According to the business scale, business nature, and customers’ settlement, etc., the account
receivable with single big amount is determined to be RMB 5 million. And the reserve for bad and
doubtful account is withdrawn with age analysis method.
(2) In combination, account receivable withdrawal bed debt procision by age analysis method:
Unit: RMB Currency: CNY
Amount at period-end Amount at period-begin
Book balance Book balance
Age Bad debt Bad debt
Ratio(%
Amount Ratio(%) provision Amount provision
)
Within
957,644.96 0.09 2,872.93 1,035,032.17 0.10 -
1year
1-2 years 98,211.62 0.01 294.63 98,211.62 0.01 -
1,037,048,650. 1,037,048,650.9 1,036,449,071.
Over 3years 99.90 1,037,048,650.91 99.89
91 1 72
1,038,104,507. 1,037,051,818.4 1,036,449,071.
Total 100.00 1,038,181,894.70 100.00
49 7 72
(3) No account receivable actually cancelled after verification in the report period.
(4) The accounts receivable at the end of the report period don’t involve with the shareholder units
hodling over 5% (including 5%) voting power of the Company.
(5) Top 5 units with an amount of account receivable:
Unit: RMB Currency: CNY
Relationship Proportion among the total
Name with the Amount Period accounts receivable (%)
company
Non-related Over 3
Client 1 174,219,907.69 16.78
party years
Non-related Over 3
Client 2 140,887,132.85 13.57
party years
Non-related Over 3
Client 3 97,930,571.16 9.43
party years
Non-related Over 3
Client 4 69,887,060.40 6.73
party years
Non-related Over 3
Client 5 52,406,319.69 5.05
party years
Total of top 5 clients of 535,330,991.79 51.57
50
accounts receivable
(6) No account receivable involving with affiliated parties in the report period.
(7) No account receivable with confirmation terminated at the end of the report period.
4. Account paid in advance
(1) Listing of account paid in advance by age
Unit: RMB Currency: CNY
Amount at the end of period Amount at the beginning of period
Age
Amount Proportion(%) Amount Proportion(%)
Within 1 year 116,730.67 38.08 23,547.00 11.03
1-2 years 75,961.88 24.77 75,961.88 35.59
2-3 years 113,914.53 37.15 113,914.53 53.38
Total 306,607.08 100.00 213,423.41 100.00
(2) The account paid in advance in the report period doesn’t involve with the shareholder units
hodling over 5% (including 5%) voting power of the Company.
5. Other accounts receivable
(1) Exposure of other accounts receivable by category:
Unit: RMB Currency: CNY
Amount at the end of period
Book balance Bad debt provision
Category
Proporti Proporti
Amount Amount
on(%) on(%)
Other account receivable with single major amount - -
and withdrawal bed debt provisio for single item - -
Other account receivable withdrawal bad debt
provision by age combination 557,801,600.63 100.00 540,470,563.07 96.89
Other account receivable with single minor amount - -
but withdrawal bed debt provisio for single item - -
Total 557,801,600.63 100.00% 540,470,563.07 96.89
Amount at the beginning of period
Book balance Bad debt provision
Category
Amount Proporti Amount Proporti
on(%) on(%)
Other account receivable with single major amount
and withdrawal bed debt provisio for single item - - - -
Other account receivable withdrawal bad debt
provision by age combination 558,537,283.06 100.00 540,451,510.17 96.76
Other account receivable with single minor amount - -
but withdrawal bed debt provisio for single item - -
Total 558,537,283.06 100.00% 540,451,510.17 96.76
Interpretation to the category of other accounts receivable:
According to the business scale, business nature, and customers’ settlement, etc., the other account
receivable with single big amount is determined to be RMB 5 million. And the reserve for bad and
doubtful account is withdrawn with age analysis method.
(2) In combination, other account receivable withdrawal bed debt procision by age analysis method:
51
Unit: RMB Currency: CNY
Amount at period-end Amount at period-begin
Age Book balance Bad debt Book balance Bad debt
Amount Proportion(%) provision Amount Proportion(%) provision
Within
1year 3,973,960.04 0.71 11,921.88 4,709,642.47 0.84 6,375.74
1-2years 4,545,244.91 0.81 13,635.73 4,545,244.91 0.81 135.73
2-3years 2,258.00 - 6.77 2,258.00 - -
Over
3years 549,280,137.68 98.48 540,444,998.69 549,280,137.68 98.35 540,444,998.69
Total 557,801,600.63 100.00 540,470,563.07 558,537,283.06 100.00 540,451,510.17
(3) No other account receivable actually cancelled after verification in the report period.
(4) The other accounts receivable at the end of the report period don’t involve with the shareholder
units hodling over 5% (including 5%) voting power of the Company.
(5) Top 5 units with an amount of other account receivable:
Unit: RMB Currency: CNY
Proportion among
Relationship
the total other
Name with the Amount Period
accounts receivable
company
(%)
Non-related Over 3
Client 1
party 220,038,935.10 years 39.45
Non-related Over 3
Client 2
party 60,359,041.39 years 10.82
Non-related Over 3
Client 3
party 30,059,193.03 years 5.39
Non-related Over 3
Client 4
party 26,012,462.08 years 4.66
Non-related Over 3
Client 5
party 20,531,780.08 years 3.68
Total of top 5 clients of other
accounts receivable 357,001,411.68 64.00
(6)No other account receivable involving with affiliated parties in the report period.
(7)No other account receivable with confirmation terminated at the end of the report period.
6. Inventory
(1) Inventory classification
Unit: RMB Currency: CNY
Amount at the end of period Amount at the beginning of period
Items Book balance Depreciation Book value Book balance Depreciation Book value
reserve reserve
Raw materials 54,845,278.28 43,902,968.40 10,942,309.88 54,845,278.28 43,902,968.40 10,942,309.88
Low value
and easily
wornoyut
articles 1,456,362.06 1,152,485.26 303,876.80 1,456,362.06 1,152,485.26 303,876.80
Merchandise
inventory 44,265,965.55 15,993,242.68 28,272,722.87 26,448,790.52 16,002,298.91 10,446,491.61
Total 100,567,605.89 61,048,696.34 39,518,909.55 82,750,430.86 61,057,752.57 21,692,678.29
(2) Inventory depreciation reserve
52
Unit: RMB Currency: CNY
Amount Decrease in the current period
Inventory Opening book Closing book
withdrawn in the
category balance Carry-back Trans-sale balance
current period
43,902,968.40 43,902,968.40
Raw materials - - -
Low value and 1,152,485.26 1,152,485.26
easily wornoyut
articles - - -
Merchandise 16,002,298.91 15,993,242.68
inventory - - 9,056.23
Total 61,057,752.57 - - 9,056.23 61,048,696.34
(3) Inventory depreciation reserve
Evidence for withdrawal Reason for carry-back of Proportion of carry-back amount in the
Items of inventory inventory depreciation current period among the closing
depreciation reserve reserve in the current period balance of the inventory
Raw materials Net realizable value is - -
below the cost.
Merchandise Net realizable value is - -
inventory below the cost.
Low value and - -
Net realizable value is
easily wornoyut
below the cost.
articles
A. Evidence for determing the net realizable value of the abovementioned inventory: raw materials
execute the average unit price of such materials purchased; the materials to be reported discarded
after quality guarantee period, out-of-dated, and not suitable for transformation, etc. execut the
recoverable amount; finished products execute the recent unit sales price of such products minus the
direct expense and taxes possibly required for realization.
B. The trans-sale of merchandise inventory in the current period is for that the abovementioned
merchandise has been sold.
53
7. Long-term equity investment
Unit: RMB Currency: CNY
Interpretation
to
depreciation
Proportion Proportion discrepancy
reserve Cash
Initial Increase of shares of voting between the depreciation
Invested Accounting Opening Closing withdrawn dividend
investment or held in power in proportion of reserve at the
unit method balance balance at the for this
cost decrease invested invested shares and end of period
current period
units (%) units (%) voting power
period
in invested
units
Hunan
Guangnan
5,679,300.00 5,679,300.00 - 5,679,300.00 5.50 5.50 - 5,679,300.00 - -
Motorcycle Cost
Co., Ltd. method
Shenzhen
Jinhuan
14,883,560.00 14,883,560.00 - 14,883,560.00 38.00 38.00 - 12,263,719.50 - -
Printing Equity
Co., Ltd. method
20,562,860.00 20,562,860.00 - 20,562,860.00 - - - 17,943,019.50 - -
Total
The industrial and commercial registration information of Shenzhen Jinhuan Printing Co., Ltd. has been cancelled as displayed. Hong Kong Dahuan
Bicycle Co., Ltd., one of the original shareholders of the company, holds the company’s shares under our entrustment, and the actual holder is our
company.
54
8. Investment real estate
Unit: RMB Currency: CNY
Opening book Increase in the Decrease in the Closing book
Items balance current period current period balance
I. Total original book value 129,872,063.32 - - 129,872,063.32
1. Houses and buildings 129,872,063.32 - - 129,872,063.32
2. Land use right - - - -
II. Total accumulated depreciation
and accumulated amortization 103,437,415.08 2,338,906.67 - 105,776,321.75
1. Houses and buildings 103,437,415.08 2,338,906.67 - 105,776,321.75
2. Land use right - - - -
III. Total net book value of
investment real estate 26,434,648.24 - - 24,095,741.57
1. Houses and buildings 26,434,648.24 - - 24,095,741.57
2. Land use right - - - -
IV. Total depreciation reserve of
investment real estate - - - -
1. Houses and buildings - - - -
2. Land use right - - - -
V. Total book value of investment
real estate 26,434,648.24 - - 24,095,741.57
1. Houses and buildings 26,434,648.24 - - 24,095,741.57
2. Land use right - - - -
(1) The depreciation amount actually accrued in the period amounting to RMB 2,338,906.67.
(2) The limit of the ownership for abovementioned investment real estate found in Note9, (6) of
“Fixed Assets”.
9. Fixed assets
(1) Fixed assets
Unit: RMB Currency: CNY
Opening book Decrease in the Closing book
Items Increase in the current period
balance current period balance
I. Total original book value 116,647,611.13 36,644.42 - 116,684,255.55
Where: Houses and 109,055,011.26 109,055,011.26
buildings - -
Machinery and equipment 4,242,098.00 - - 4,242,098.00
Means of transport 923,478.06 - - 923,478.06
Other equipment 2,427,023.81 36,644.42 - 2,463,668.23
Accrued this
Newly added
period
II. Total accumulated - 95,359,744.27
92,707,944.16 2,651,800.11
depreciation -
Where: Houses and 91,971,100.91
89,636,132.88 2,334,968.03
buildings - -
Machinery and equipment 621,162.98 - 164,344.64 - 785,507.62
Means of transport 688,922.72 - 22,651.02 - 711,573.74
Other equipment 1,761,725.58 - 129,836.42 - 1,891,562.00
III. Total net book value of 23,939,666.97 - - 21,324,511.28
55
fixed assets
Where: Houses and 19,418,878.38 - 17,083,910.35
buildings -
Machinery and equipment 3,620,935.02 - - 3,456,590.38
Means of transport 234,555.34 - - 211,904.32
Other equipment 665,298.23 - - 572,106.23
IV. Total depreciation 2,391,674.23 - - 2,391,674.23
reserve
Where: Houses and 1,580,000.00 - 1,580,000.00
buildings -
Machinery and equipment 426,800.00 - - 426,800.00
Means of transport - - - -
Other equipment 384,874.23 - - 384,874.23
V. Total book value of fixed 21,547,992.74 - 18,932,837.05
assets -
Where: Houses and 17,838,878.38 - 15,503,910.35
buildings -
Machinery and equipment 3,194,135.02 - - 3,029,790.38
Means of transport 234,555.34 - - 211,904.32
Other equipment 280,424.00 - - 187,232.00
Depreciation amount in this period was RMB 2,651,800.11.
(2) Fixed assets left idle temporarily at the end of period
Unit: RMB Currency: CNY
Original book Accumulated Depreciation
Items Net book value Remark
value depreciation reserve
Houses and
34,505,947.26 28,855,598.40 - 5,650,348.86 -
buildings
Machinery and
252,098.00 145,307.33 - 106,790.67 -
equipment
34,758,045.26 29,000,905.73 - 5,757,139.53
Total
(3) No fixed assets rent by means of financing lease at the end of period.
(4) No fixed assets held for sale at the end of period.
(5) No fixed assets without handling certificate of title at the end of period.
Among the Company’s houses and buildings, except for Zhonghua Garden (originally worthy of
RMB 7,226,043.16) with certificate of title handled, others have not had the ownership certificate
handled. Details are:
Reason for failing to
Estimated time for handling the
Items handle the certificate of
certificate of title
title
Employees’ dining hall (building 10 in Formalities not
Unpredictable
Shuibei Factory Area) completed
Ice room of dining hall (building 11 in Formalities not
Unpredictable
Shuibei Factory Area) completed
Employees’ residence (1)(building 8 in Formalities not
Unpredictable
Shuibei Factory Area) completed
Employees’ residence (2) (building 9 in Formalities not
Unpredictable
Shuibei Factory Area) completed
Employees’ residence (3) (building 14 in Formalities not
Unpredictable
Shuibei Factory Area) completed
Employees’ residence (4) (building 19 in Beili Formalities not
Unpredictable
Garden) completed
56
Reason for failing to
Estimated time for handling the
Items handle the certificate of
certificate of title
title
Formalities not
Factory building 1 Unpredictable
completed
Formalities not
Factory building 2 Unpredictable
completed
Formalities not
Factory building 3 Unpredictable
completed
Formalities not
Factory building 4 Unpredictable
completed
Formalities not
Factory building 5 Unpredictable
completed
Formalities not
Administration building Unpredictable
completed
Formalities not
Complex building Unpredictable
completed
Formalities not
Residence building 1 Unpredictable
completed
Formalities not
Residence building 2 Unpredictable
completed
Formalities not
Residence building 3 Unpredictable
completed
Formalities not
Residence building 4 Unpredictable
completed
Formalities not
Residence building 5 Unpredictable
completed
7 Guang’ancheng, West Section, Guohuo Formalities not
Unpredictable
Road, Taijiang District, Fuzhou completed
No. 2, A, 54 Liuquan Road, Zhangdian Formalities not
Unpredictable
District, Zibo completed
Saige Garden, Huaqiang South Road, Formalities not
Unpredictable
Shenzhen completed
(6) Assets with limited ownership
1) The Company has provided guarantee for the subsidiary Hong Kong Zhonghua for the loan of
USD7.5 million from China Merchants Bank. Hong Kong Zhonghua failed to pay the debt on
schedule, and China Merchants Bank brought a suit against the subsidiary to Shenzhen Intermediate
People’s Court. This court sealed up the Company’s 127,333 m2 land located at Yousong Village,
Longhua Town, Bao’an District and buildings on the land.
2) The Company owed the imprest money for L/C US$500,000 and related interest, and was sued to
Shenzhen Luohu People’s Court. The court plans to auction the Company’s real estate at Saige
Garden, Huaqiang South Road, Shenzhen for repayment of debt.
(7) Other explaination
1) Property right of #2, 54-A, Liuquan Rd. Zhangdian District, Zibo City, Shandong Province still
in process of ownership transfer, transferring amount of 1,267,500.00 yuan has been received dated
21st June 2011. This property is not been verified due to uncompleted procedures.
10. Intangible assets
(1) Intangible assets
Items Opening book Increase in the Decrease in the Closing book
balance current period current period balance
I. Original book valueTotal 43,143,099.08 - - 43,143,099.08
Land use right 43,143,099.08 - - 43,143,099.08
II. Total accumulated -
amortization 17,688,671.82 431,431.02 18,120,102.84
Land use right 17,688,671.82 431,431.02 - 18,120,102.84
III. Total net book value of 25,454,427.26 - - 25,022,996.24
57
Items Opening book Increase in the Decrease in the Closing book
balance current period current period balance
intangible assets
Land use right 25,454,427.26 - - 25,022,996.24
IV. Total depreciation reserve - - - -
Land use right - - - -
Total book value of intangible - -
assets 25,454,427.26 25,022,996.24
Land use right 25,454,427.26 - - 25,022,996.24
1) The land use right is the 127,333m2 land located at Yousong Village, Longhua Town, Baoan
District, and the service life is from July 1, 1990 to June 30, 2040. The limitation on the ownership
is as shown in the annotation 9, (6) of “Fixed Assets”.
2) Amount amortized in the current period is RMB 431,431.0.
11. Details of asset depreciation reserve
Unit: RMB Currency: CNY
Increase Decrease in the current
Opening book in the period Closing book
Items
balance current Carry-bac Trans-sale balance
period k
I. Reserve for bad and doubtful 1,576,900,581. 621,799.6 1,577,522,381.
account 89 5 - - 54
II. Inventory depreciation reserve 61,057,752.57 - - 9,056.23 61,048,696.34
III. Depreciation reserve of - - - - -
salable financial assets
IV. Depreciation reserve of - - - - -
held-to-maturity investment
V. Depreciation reserve of - - -
long-term equity investment 17,943,019.50 17,943,019.50
VI. Depreciation reserve of - - -
investment real estate - -
VII. Depreciation reserve of fixed - - -
assets 2,391,674.23 2,391,674.23
VIII. Depreciation reserve of - - - - -
engineering materials
IX. Depreciation reserve of - - - - -
engineering under construction
X. Depreciation reserve of - - - - -
productive biological assets
Where:Depreciation reserve of - - - - -
mature productive biological
assets
XI. Depreciation reserve of - - - - -
oil-gas assets
XII. Depreciation reserve of - - - - -
intangible assets
XIII. Depreciation reserve of - - - - -
business credit
XIV. Others - - - - -
1,658,293,028. 621,799.6 1,658,905,771.
Total
19 5 - 9,056.23 61
The trans-sale amount for depreciation provision of inventory resulted by the sales realized.
12. Short-term loan
(1) Classification of short-term loan:
Unit: RMB Currency: CNY
58
Items Amount at the end of period Amount at the beginning of period
Loan on security 242,362,170.40 243,928,066.33
Credit loan 137,102,954.88 140,289,581.76
Total 379,465,125.28 384,217,648.09
(2) Short-term loan at term but not repaid:
Unit: RMB Currency: CNY
Reason for not Estimated date
Borrower Amount Purpose
repayment of repayment
Loan for
China Import and Export Bank of production Capital shortage Unpredictable
China 114,558,000.00 turnover
Loan for
China Cinda Assets Management production Capital shortage Unpredictable
Company 58,230,409.75 turnover
Loan for
Head Office of China Merchants production Capital shortage Unpredictable
Bank 52,200,387.02 turnover
Loan for
Dongfu Assets Management production Capital shortage Unpredictable
Company 47,438,994.97 turnover
Loan for
Oriental Assets Management production Capital shortage Unpredictable
Company 43,510,960.00 turnover
Loan for
Huizhou Oriental United production Capital shortage Unpredictable
Industry Co., Ltd. 35,414,763.63 turnover
Loan for
China Merchants Bank, Luohu production Capital shortage Unpredictable
Subbranch 17,449,198.85 turnover
Loan for
production Capital shortage Unpredictable
China Everbright Bank 10,042,411.06 turnover
Loan for
China Construction Bank, production Capital shortage Unpredictable
Sichuan Mianyang Subbranch 620,000.00 turnover
Total 379,465,125.28
The abovementioned loans have been over due for many years.
13. Accounts payable
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
Within 1 year 26,802,644.15 12,901,430.02
1-2 years 163,405.06 163,405.06
2-3 years 122,501.80 122,501.80
Over 3 years 112,440,785.84 112,440,785.84
Total 139,529,336.85 125,628,122.72
(1) Accounts payable of over one year are mainly because that the Company is insolvent and has
delayed the replayment for many years.
(2)The accounts payable in the report period don’t involve with the shareholder units hodling over
5% (including 5%) voting power of the Company.
14. Account received in advance
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
59
Within 1 year 11,844,275.13 5,910,048.99
1-2 years 86,960.36 86,960.36
2-3 years - -
Over 3 years 10,664,592.85 10,664,592.85
Total 22,595,828.34 16,661,602.20
(1) Big-amount items received in advance with an age of over 1 year are mainly formed
accumulatively in historical business communication.
(2) The items received in advance in the report period don’t involve with the shareholder units
hodling over 5% (including 5%) voting power of the Company.
15. Wages payable
Unit: RMB Currency: CNY
Opening book Increase in the Decrease in the Closing book
Items
balance current period current period balance
I. Salary, bonus, allowance, and
subsidy 2,251,298.50 6,398,466.19 7,418,267.63 1,231,497.06
II. Employee benefit 25,906.94 25,906.94
III. Social insurance -
IV. Public accumulation fund for
housing construction 60,000.00 330,000.00 390,000.00
V. Dismiss welfare 38,565.69 38,565.69
VI. Trade union outlays and
personnel education outlay 1,426,469.26 65,217.93 42,450.00 1,449,237.19
VII. Others -
Total 3,802,240.39 6,793,684.12 7,460,717.63 3,135,206.88
(1) No remuneration in arrear among the employees’ remuneration payable.
(2) The trade union outlays and personnel education outlay in the current year is RMB 65,217.93.
16. Taxes payable
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
VAT 54,160,978.10 56,554,659.77
Sales tax 433,506.44 440,900.28
Enterprise income tax 33,753,125.02 33,753,125.02
Individual income tax -59,354.32 -21,156.15
Tax for maintaining and building
cities 2,361.25 141,302.23
Housing property tax 7,303,655.67 7,303,655.67
Others -274.74 46,376.91
Total
95,593,997.42 98,218,863.73
The Company has owed taxes for long time, and there is the probability to make supplementary
payment of forfeit money and late fee.
17. Interest payable
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
Loan interest 193,470,439.90 213,488,233.36
In April of 2011, the reorganization plan of Guangdong Shengrun Group Co., Ltd. was executed
completely that ruling by Shenzhen Intermediate People’s Court( found more in Notice of Board of
60
Shenrun Company dated 26th April 2011), relevant original book value has been adjusted by the
Company for debt withdrawal.
18. Other account payable
(1) Age of other accounts payable:
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
Within 1 year 11,775,879.52 11,730,547.74
1-2 years 2,468,597.75 2,468,597.75
2-3 years 572,084.12 572,084.12
Over 3 years 384,245,202.85 151,065,795.79
Total 399,061,764.24 165,837,025.40
(2) The accounts payable-others in the report period don’t involve with the shareholder units
hodling over 5% (including 5%) voting power of the Company.
(3) Bit-amount accounts payable of over one year are accounts unable to pay by the Company.
(4) The creditors right of Shengrun Company that newly received by Dongtaixin Company was
transfer-in from item of “Other long-term liability” with amount of 232,801,657.06 yuan. The debt
has over three years terms.
19. Non-current liability due within one year
(1)
Unit: RMB Currency: CNY
Items Amount at the end of period Amount at the beginning of period
Long-term credit loans due within
463,546,803.89 706,645,180.86
one year
(2) Top five long-term loans due within one year
Unit: RMB Currency: CNY
Amount at the end of period
Borrower Curency Amount in foreign
Amount in RMB
currencies
Shenzhen Guosheng Energy Investment
and Development Co., Ltd. USD 62,829,259.02 406,605,832.63
Shenzhen Guosheng Energy Investment
and Development Co., Ltd. RMB - 19,300,058.59
China Cinda Assets Management Co., Ltd. USD 2,157,395.94 13,961,803.54
Great Wall Assets Management Co., Ltd. USD 2,000,000.00 12,943,200.00
Xie Lingling USD 500,000.00 3,235,800.00
Total 456,046,694.76
(3) Overdue loans among the long-term loans coming due within one year
Unit: RMB Currency: CNY
Borrowers Amount Term exceeded
425,905,891.22 Overdue for multiple years
Guosheng Energy Investment Co.,
China Cinda Assets Management
13,961,803.54 Overdue for multiple years
Co.,
China Great Wall Assets
12,943,450.00 Overdue for multiple years
Management Co.,
6,235,550.00 Overdue for multiple years
Xie Lingling
China Oriental Assets Management
3,000,000.00 Overdue for multiple years
Co.,
1,500,109.13 Overdue for multiple years
Shenzhen Lionda Group Co., Ltd.
463,546,803.89
Total
61
20. Other current liabilities
Unit: RMB Currency: CNY
Items Closing book balance Opening book balance
Rent 521,639.87 521,639.87
Decoration fee 188,853.82 188,853.82
Others 46,418.40 45,668.40
Total 756,912.09 756,162.09
21. Estimated liabilities
Unit: RMB Currency: CNY
Amount at the Increase in Decrease in the Amount at the
Items beginning of the current current period end of period
period period
Loan guarantee for ZoriaPteLTd 78,087,000.00 - - 78,087,000.00
Loan guarantee for Jintian Industry (Group) - -
50,000,000.00 50,000,000.00
Co., Ltd.
Loan guarantee for Guangdong Shengrun -
Group Co., Ltd. 42,918,300.00 12,875,490.00 30,042,810.00
Loan guarantee for Shenzhen Tianma - -
Cosmetics Co., Ltd. 8,000,000.00 8,000,000.00
Loan guarantee for Shandong Huajiaming - -
Economic Trading Co., Ltd. 83,142.92 83,142.92
Total 179,088,442.92 - 12,875,490.00 166,212,952.92
In April of 2011, the reorganization plan of Guangdong Shengrun Group Co., Ltd. was executed
completely that ruling by Shenzhen Intermediate People’s Court. According to reorganization plan
of Shengrun Company, ordinary creditors right owes 30 pecent liquidation ratio, therefore, the
estimated liability was adjusted by the Company correspondingly.
The abovementioned guarantee for other companies have been in serious insolvency or gone
bankrupt.
62
22. Share capital
Unit: RMB Currency: CNY
Amount at the beginning of Amount at the end of period
Increase/ decrease (+, -)
period
Items Shares
Proportion New shares Shares
Amount transferred for Others Subtotal Amount Proportion(%)
(%) issued presented
public reserve
I. Circulating shares with limited - - -
sales conditions 186,722,139,00 33.87 -77,507,909.00 -77,507,909.00 109,214,230.00 19.81
1. Shares held by state-owned legal
person (A-share) 16,340,000.00 2.96 - - - -16,340,000.00 -16,340,000.00 - -
2.Shares held by domestic corporate - - -
sponsors(A-share) 88,767,002.00 16.10 -23,668,590.00 -23,668,590.00 65,098,412.00 11.81
3. Shares held by domestic natural - - -
person sponsors (A-share) 6,500,000.00 1.18 -6,500,000.00 -6,500,000.00 - -
4. Shares held by overseas - - -
corporates(B-share) 75,106,190.00 13.62 -31,001,944.00 -31,001,944.00 44,104,246.00 8.00
5. Shares held by senior executives - - -
(A-share) 8,947.00 0.002 2,625.00 2,625.00 11,572.00 0.002
II. Circulating shares without limited - -
sales conditions 364,625,808.00 66.13 - 77,507,909.00 77,507,909.00 442,133,717.00 80.19
1. Common RMB shares listed - -
domestically (A-share) 116,262,826.00 21.08 - 77,510,534.00 77,510,534.00 193,773,360.00 35.14
- -
-
-2,625.00
2. Foreign shares listed domestically
(B-share) 248,362,982.00 45.05 -2,625.00 248,360,357.00 45.05
- - -
Total 100.00 100.00
551,347,947.00 - 551,347,947.00
Changes of the abovementioned amount mainly becaused: the proposal of share capital increased from capital reserve orientation and share-tanding reform was approved by
the Shareholders’ General Meeting on 1 Februray 2007. the plan also obtained the approve from Ministry of Finance People’s Republic of China, SZP[2007] No. 1343 and
approved from Shenzhen Bureau of Trad and Indusrty, SMGZF[2007] No. 2257—Approval of the Increased of Total Share Capital of Shenzhen China Bicycle Holdings Co.,
Ltd. Being consented, the plan was implemented on 18 March 2010. Total share capital of the Company turns from 479,433,000 shares to 551,347,900 shares, the A-shaer
resumed for listing. The share capital of RMB 71,914,944.00 increaed on 18 March 2010 that have been verified by Shenzhen Pengcheng CPA Co., Ltd. with Verification
Report of SPSYZ[2010] No. 356. Registration changes for Industy and Commerce have been done dated 16 March 2011. In April of 2011, part of the restricted shares have
been on trade in market.
63
23. Capital reserve
Unit: RMB Currency: CNY
Items Amount at the Increase in the Decrease in the Amount at the end
beginning of period current period current period of period
Capital premium - - - -
Other capital reserve 427,132,693.91 17,029,016.96 - 444,161,710.87
Where:Benefit from liability
423,124,068.94 17,029,016.96 - 440,153,085.90
recombination
Accounts unnecessary to
690,624.97 - - 690,624.97
pay
price difference of affiliated
3,318,000.00 - - 3,318,000.00
transactions
Total 427,132,693.91 17,029,016.96 - 444,161,710.87
Interpretation of capital reserve:
The amount increased in the period refers to that according to the Notification on Getting Done with
the Annual Report of Enterprises Executing Accounting Rules in 2008 [CKH (2008) No. 60] of the
Ministry of Finance, the Company’s holding shareholder Shenzhen Guosheng Energy Investment
and Development Co., Ltd. exempted the Company’s loan interest RMB 17,029,016.96 in first hald
year of 2011, which will be charged into the capital reserve as capital investment.
24. Surplus reserve
Unit: RMB Currency: CNY
Items Amount at the Increase in the current Decrease in the Amount at the end of
beginning of period period current period period
Statutory surplus - -
reserve 32,673,227.01 32,673,227.01
25. Retained profit
Unit: RMB Currency: CNY
Proportion of
Items Amount withdrawal or
distribution
Undistributed profit of the previous year before adjustment -2,767,339,310.79 -
Total undistributed profit at the beginning of year adjusted (+, -
-) -
Undistributed profit at the beginning of year after adjustment -2,767,339,310.79 -
Add: Net profit classed under the parent company in the -
current period 26,213,,055.39
Less: Withdrawal of legal surplus reserve - 10%
Withdrawal of free surplus reserve - -
Withdrawal of general risk reserve - -
Common stock dividend payable - -
Common stock dividend transferred into share capital - -
Retained profit at the end of period -2,741,126,255.40 -
26. Business income and business cost
(1) Business income and business cost
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period
Items
period of last year
Major business income 126,235,456.55 112,764,460.92
Other business income 10,302,138.70 7,858,325.22
Business cost 126,708,502.29 114,045,625.35
(2) Major businesses (by industry)
64
Unit: RMB Currency: CNY
Amount incurred in same period of last
Amount incurred in the current period
Product name year
Business income Business cost Business income Business cost
Bicycle and parts
125,098,747.76 119,627,722.60 111,611,190.57 106,650,381.83
distribution
Property and lease
1,136,708.79 2,054,127.12 1,153,270.35 2,050,742.13
management
Total
126,235,456.55 121,681,849.72 112,764,460.92 108,701,123.96
(3)Major businesses (by variety)
Unit: RMB Currency: CNY
Amount incurred in same period of last
Amount incurred in the current period
Product name year
Business income Business cost Business income Business cost
OEM motor vehicle 102,525,769.38 98,330,383.14 92,467,792.44 88,627,357.94
OEM Bicycle 20,858,413.02 19,581,264.29 18,760,441.30 17,555,520.98
CBC motor vehicle 1,076.92 1,009.04 173,294.01 302,840.72
CBC Bicycle 39,102.59 41,302.17 22,374.35 24,261.46
Others 1,674,385.85 1,673,763.96 187,288.47 140,400.73
Property and lease
1,136,708.79 2,054,127.12 1,153,270.35 2,050,742.13
management
Total 126,235,456.55 121,681,849.72 112,764,460.92 108,701,123.96
(4) Business income of the Company’s top five customers
Unit: RMB Currency: CNY
Proportion among the Company’s
Customer name Business income
total business income
Customer 1 42,288,811.25 30.97
Customer 2 28,636,957.31 20.97
Customer 3 18,933,030.21 13.87
Customer 4 12,938,950.38 9.48
Customer 5 2,591,275.61 1.90
Total 105,389,024.76 77.19
27. Business tax and surcharge
Unit: RMB Currency: CNY
Amount incurred in the Amount incurred in same
Items Collection standard
current period period of last year
Sales tax 56,835.46 57,663.55 5%
Tax for maintaining and
building cities 56,854.48 5,883.69 7% of turnover tax
Educational surtax 24,366.21 17,651.05 3% , 5% of turnover tax
Total 138,056.15 81,198.29 -
65
28. Sales expenses
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
Total
2,712,707.55 3,756,001.70
29. Management expenses
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
Total
11,100,530.20 11,959,630.53
Explaination to management expenses: amount occurred this period decreased 859,100.33 yuan over
that of same period the year before.
30. Fianncial expenses
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
Interest expenditure 31,806,654.38 47,768,875.83
Less: interest income 36,145.98 40,236.67
Gains/losses from exchange -14,949,756.37 -4,536,448.49
Other 24,621.28 20,109.41
Total 16,845,373.31 43,212,300.08
31. Asset depreciation loss
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
I. Loss from doubtful accounts 621,799.65 -
II. Loss from inventory
depreciation - -
III. Depreciation loss of salable - -
financial assets
IV. Depreciation loss of - -
held-to-maturity investment
V. Depreciation loss of long-term -
equity investment -
VI. Depreciation loss of - -
investment real estate
VII. Depreciation loss of fixed - -
assets
VIII. Depreciation loss of - -
engineering materials
IX. Depreciation loss of - -
engineering under construction
X. Depreciation loss of productive - -
biological assets
XI. Depreciation loss of oil-gas - -
assets
XII. Depreciation loss of - -
intangible assets
XIII. Depreciation loss of business - -
credit
XIV. Others - -
Total 621,799.65 -
66
32. Non-operating income
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
Total amount obtained from
disposing noncurrent assets - -
Where: Benefit from disposal of
fixed assets - -
Benefit from disposal of
intangible assets - -
Benefit from debt recombination - -
Taxes refund - 254,666.00
Other 47,835,399.29 544,496.77
Total 47,835,399.29 799,162.77
As for non-operating income in this period, the reorganization plan of Shengrun Company was
rulling for executed completion by Shenzhen Intermediate People’s Court in April 2011, original
interest and predicted liabilities that withdrawal previously have been adjusted by the Company for
reckoned into non-operating income item by decreased amount.
33. Non-operating expenditure
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
Total loss from disposal of
noncurrent assets - -
Where: Loss from disposal of fixed
assets - -
Loss from disposal of - -
intangible assets
Others 32,970.00 30,680.00
Total 32,970.00 30,680.00
34. Calculation process of basic earning per share and diluted earning per share (eps)
Unit: RMB Currency: CNY
Amount Amount
Calculation incurred in incurred in
Items
process the current same period
period of last year
Net profit classed under the Company’s common 26,213,055.3 -51,663,487.
P0
shareholders 9 04
Non-frequent gain and loss classed under the Company’s 47,802,429.2
F 768,482.77
common shareholders 9
Net profit classed under the Company’s common -21,589,373. -52,431,969.
P0'=P0-F
shareholders after deduction of non-frequent gain and loss 90 81
Influences of diluted items on the net profit classed under
V - -
the Company’s common shareholders
Net profit classed under the Company’s common
shareholders, considering the influences of diluting potential -21,589,373. -52,431,969.
P1=P0+V
common shares, and making adjustments according to 90 81
Enterprise Accounting Standards and related regulations
Influences of diluted items on the net profit classed under
the Company’s common shareholders after deducation of V' - -
non-frequent gains and losses
Net profit classed under the Company’s common P1'=P0'+V' -21,589,373. -52,431,969.
67
Amount Amount
Calculation incurred in incurred in
Items
process the current same period
period of last year
shareholders, considering the influences of diluting potential 90 81
common shares, and making adjustments according to
Enterprise Accounting Standards and related regulations
551,347,947. 479,433,003.
Total shares at the beginning of period S0
00 00
Shares increased for increase of shares transferred from
71,914,944.0
public reserve or for share dividend distribution in the report S1 -
0
period
Shares increased for issuance of new shares or shares
Si - -
transferred from liabilities in report period
Shares decreased for buyback, etc. in report period Sj - -
Shares shortened in report period Sk - -
Number of months in report period M0 6 6
Accumulated number of months from the next month of
Mi - 3
share increase to the end of report period
Accumulated number of months from the next month of
Mj - -
share decrease to the end of report period
S=S0+S1+Si×
Weighted average number of common shares issued Mi 551,347,947. 551,347,947.
externally ÷M0–Sj×Mj÷M 00 00
0-Sk
Add: Weighted average number of common shares increased
in condition that the diluted potential common shares are X1 - -
supposed transferred into issued common shares
Weighted average number of common shares with diluted 551,347,947. 551,347,947.
X2=S+X1
eps calculated 00 00
Where: Weighted average number of common shares
- -
increased from transfer of conversible corporate bonds
Weighted average number of common shares increased from
- -
equity warrant/ stock equity implementation right
Weighted average number of common shares increased from
- -
buyback promise implementation
Basic eps classed under the Company’s common
EPS0=P0÷S 0.0475 -0.0937
shareholders
Basic eps classed under the Company’s common
shareholders after deducation of non-frequent gains and EPS0'=P0'÷S -0.0392 -0.0951
losses
Diluted eps classed under the Company’s common
EPS1=P1÷X2 0.0475 -0.0937
shareholders
Diluted eps classed under the Company’s common
shareholders after deducation of non-frequent gains and EPS1'=P1'÷X2 -0.0392 -0.0951
losses
35. Notes to items in cash flow statement
(1) Other cash received related with business activities
Unit: RMB Currency: CNY
Amount incurred in the current Amount incurred in same period of
Items
period last year
Rent, electric rate and water rate 10,002,805.12 7,666,393.59
Parts disposal money 35,026.85 62,500.00
Other current accounts 1,340,477.34 2,002,171.72
Total 11,378,309.31 9,731,065.31
(2)Other cash paid related with business activities
68
All refers to period expenses that paid in cash.
36. Supplementary data of cash flow statement
(1)Supplementary data of cash flow statement
Unit: RMB Currency: CNY
Amount at same
Amount of the
Supplementary data period of last
current period
year
1．Cash flow for business activities transferred from net profit:
Net profit 26,213,055.39 -51,663,487.04
Add: Asset depreciation reserve 621,799.65 -
Fixed asset depreciation, oil-gas asset depletion, and productive
biological asset depreciation 5,423,686.18 5,654,265.04
Amortization of intangible assets 431,431.02 431,431.02
Amortization of long-term fees to be apportioned - -
Loss from disposal of fixed assets, intangible assets and other
long-term assets (filled with “－” for benefit) - -
Loss from fixed assets reported discarded (filled with “－” for benefit) - -
Loss from change of fair value (filled with “－” for benefit) - -
Fincial cost (filled with “－” for benefit) 16,845,373.31 43,212,300.08
Investment loss (filled with “－” for benefit)) - -
Decrease of deferred income tax asset (filled with “－” for increase) - -
Increase of deferred income tax liability (filled with “－” fordecrease) - -
Decrease of inventory (filled with “－” for increase) -17,826,231.26 -9,385,138.91
Decrease of operating items receivable (filled with “－” for increase) 2,093,816.97 10,039,870.03
Increase of operating items payable (filled with “－” for decrease) -32,488,857.70 7,461,491.72
Others - -
Net cash flow from business activities 1,314,073.56 5,750,731.94
2．Important investment and financing activities not involving with
cash income and expenditure
Capital transferred from liability - -
Conversible corporate bonds coming due within one year - -
Fixed assets rented by financing - -
3．Net change of cash and cash equivalent:
Closing balance of cash 20,298,570.72 25,534,863.41
Less: Opening balance of cash 17,756,773.58 22,232,425.07
Add: Closing balance of cash equivalent - -
Less: Opening balance of cash equivalent - -
Net increase of cash and cash equivalent 2,541,797.14 3,302,438.34
(2) Composition of cash and cash equivalent
Unit: RMB Currency: CNY
Amount at the end of Amount at the beginning
Items
period of period
I. Cash 20,298,570.72 17,756,773.58
Where: Cash on hand 123,910.37 166,739.31
Bank deposit available for payment anytime 20,174,660.34 17,590,034.27
Other monteray fund available for payment - -
anytime
Due from China Central Bank for payment - -
Due from banks - -
Call loans to banks - -
II. Cash equivalent - -
Where: Bond investment coming due within 3 months - -
69
Amount at the end of Amount at the beginning
Items
period of period
III. Closing balance of cash and cash equivalent 20,298,570.72 17,756,773.58
VI. Affiliated Parties and Affiliated Transactions
1. Shareholders controlled by the enterprise
Unit: RMB Currency: CNY
Affi Propor Proporti
liat Regi tion of on of ultimate
Regi Legal
ed stere shares voting controlle Organi
controlling Enterpri strati repre Business
rela d held in power r of the zation
shareholder se type on sentat nature
tion capit the in the enterpris code
place ive
shi al enterpr enterpris e
p ise (%) e (%)
Industry,
domestic
Limited
Co commerce, Shenzhe
Shenzhen liability
ntro materials n
Guosheng compan
llin Shan supply and National
Energy y
g Shen g sale 700 Investme 774115
Investment (solely 11.81 11.81
sha zhen Shiju (excluding 0 nt and 79-2
and funded
reh n specially run, Develop
Developme by the
old controlled ment
nt Co., Ltd. corporat
er and sold Co., Ltd.
e)
merchandises
)
2. Detailed information about the Company’s subsidiaries is as shown in 1 of Annotation IV of
the report.
70
3. Joint management and joint-ownership enterprises of the Company
Unit: RMB Currency: CNY
Proportion
Increa Proportion
Initial of voting Depreciation
Invested Accounting Opening se/ Closing of shares in
investment power in the reserve at the
unit method balance decrea balance the invested
cost invested unit end of period
se unit (%)
(%)
Shenzhen
Jinhuan Equity
Printing method 14,883,560.00 14,883,560.00 - 14,883,560.00 38.00 38.00 12,263,719.50
Co., Ltd. *
*The industrial and commercial registration information of Shenzhen Jinhuan Printing Co., Ltd. has
been cancelled as displayed. Hong Kong Dahuan Bicycle Co., Ltd., one of the original shareholders
of the company, holds the company’s shares under our entrustment, and the actual holder is our
company.
4. Accounts receivable/ accounts payable and exemption items of affiliated parties
(1) Current accounts
Unit: RMB Currency: CNY
Amount at the end of Amount at the
Items Affiliated parties
period beginning of period
Other accounts Shenzhen Jinhuan Printing Board Co.,
2,616,430.50 2,616,430.50
payable Ltd.
Long-term liability
Shenzhen Guosheng Energy
coming due within one 425,905,891.22 435,399,392.26
Investment and Development Co., Ltd.
year
Shenzhen Guosheng Energy
Interest payable 3,342,625.50 2,948,836.74
Investment and Development Co., Ltd.
Other account payable Shenzhen Guosheng Energy
6,500,000.00 6,500,000.00
* Investment and Development Co., Ltd.
* Subordinate subsidiary of the Company-Shenzhen Emmelle Industry Co., Ltd. financing RMB 6.5
million from Shenzhen Guosheng Energy Investment and Development Co., Ltd.
71
(2) Exempted items
Unit: RMB Currency: CNY
Items Amount incurred in the Amount incurred in
Related parties
current period same period of last year
Shenzhen Guosheng Energy
Financial cost 17,029,016.96 34,796,714.17
Investment and Development Co., Ltd.
According to the Notification on Getting Done with the Annual Report of Enterprises Executing
Accounting Rules in 2008 [CKH (2008) No. 60] of the Ministry of Finance, the Company’s holding
shareholder Shenzhen Guosheng Energy Investment and Development Co., Ltd. exempted the
Company’s loan interest RMB 17,029,016.9 in first half year of 2011, which will be charged into
the capital reserve as capital investment.
VII. Contingent Items
1. Contingent liabilities formed from pending lawsuit and arbitration, and financial influences
(1) As of June 30, 2011, the Company had been prosecuted by 17 financial instutions, involving
total loan principal and interest of RMB 425,460,600, US$76,852,000 and HK$ 8,261,600. The
abovementioned lawsuits have mostly been resulted in the Company’s failure or been mediated.
After lawsuits, partial debtors have transferred the creditor’s right, and the principals involved in the
cases are changed accordingly.
(2) As of June 30, 2011, the Company had been prosecuted by 36 goods suppliers, involving total
loan principal and interest of RMB 62,830,000, HK$ 24,530,000 and US$ 3,260,000. The
abovementioned lawsuits have mostly been resulted in the Company’s failure or been mediated.
2. Contingent liabilities formed from providing liability guaranty for other units, and financial
influences
Influences on the Company’s
financial state, business result
Items Amount involved Nature
and cash flow in the current
period and future periods
Loan guarantee for Guangdong Shengrun Group RMB25,270,000.00
(1) Guaranty
Co., Ltd. US$700,000.00
Loan guaranty for Gintian Industry (Group) Co.,
RMB50,000,000.00 (2) Guaranty
Ltd.
Loan guaranty for Shenzhen Tianma Cosmetics
RMB8,000,000.00 (3) Guaranty
Co., Ltd.
ZoriaPteLtdc US$10,000,000.00 (4) Guaranty
Shandong Huajiaming Economic Trade Co.,
RMB83,142.92 (5) Guaranty
Ltd.
RMB83,353,142.92
Total
US$10,700,000.00
(1) The company estimated the loss based on 100% guaranteed amount. In April of 2011, the
reorganization plan of Guangdong Shengrun Group Co., Ltd. was executed completely that ruling
by Shenzhen Intermediate People’s Court. According to reorganization plan of Shengrun Company,
ordinary creditors right owes 30 pecent liquidation ratio, therefore, the estimated liability was
adjusted by the Company correspondingly.
(2) The company is a listed company limited, and has been in serious insolvency. The loss is
estimated as per 100% guaranteed amount.
(3) The company has gone bankrupt. The loss is estimated as per 100% guaranteed amount.
(4) The company has been in serious solvency, and is being liquidated. The loss is estimated as per
100% guaranteed amount.
(5)The company has been in serious solvency. The loss is estimated as per 100% guaranteed
amount.
VIII.Committment Items
The Company had no important committment in the report period.
72
IX．Afterward Items of Balance Sheet
No afterward items of balance sheet in this period for the Company.
X .Other important items
1. Financial debt reconstructing
In accordance with YJBT [2004] No.6 Document issued by the Office of China Banking Regulatory
Commission on Jan. 7th, 2004, the Bank of China, totally 11 financial institutes agreed to stop
calculating the interests as of Jan. 1st, 2002 for three years, and exempt all and any interests
paypable prior to Dec. 31st, 2001, including the default interests and compound interests. The
Company will transfer all the interests payable (including the default interests and compound
interests) of RMB 357,993,665.24 prior to Dec. 31st, 2001 to “public accumulated capital”, and the
interests will be not calculated temporarily from Jan. 1st, 2002 to Dec. 31st, 2004. This term of
interests exemption shall be valid before Dec. 31st, 2004.
In 2005, China Huarong Asset Management Corporation Shenzhen Office, China Orient Asset
Management Corp. Shenzhen Office, China Cinda Asset Management Corporation Shenzhen Office
and China Great Wall Asset Management Corporation Shenzhen Office will continuous to stop
calculating the interests of 2005 loans.
Whereas the term of “Stop Calculating Inerests” may cause discrepancy and General Terms on the
Loan did not interprate its meaning either, China Huarong Asset Management Corporation
Shenzhen Office, China Orient Asset Management Corp. Shenzhen Office, China Cinda Asset
Management Corporation Shenzhen Office and China Great Wall Asset Management Corporation
Shenzhen Office all agree not to claim the Company to repay all the interests stopped calculating
herein. However, Shenzhen Development Bank requied the Company to repay all the interests and
compound interests which was stopped calculating from Jan.1st, 2002 to Dec.31, 2004. The
Company argued that the interests which were stopped calculating shall not be repaid; therefore,
after the period during which the interests is stopped calculating, the interests to be repaid shall be
calculated as the normal loans, but not the interests and compound interests stopped calculating
from Jan.1st, 2002 to Dec. 31, 2004. As of Dec. 31st, 2010, the sum of interests confirmed by
creditor bank is RMB324,879,558.04 more than the interests payable of book value, and some
institutes have no reply to the confirmation of debts. In such a case, the Company thought that we
cannot decide if this part of interests can be withdrawn or repaid, thus no any financial adjustment is
done till now.(this report refers to the midterm report without audited, data of annual report was
used for carrying)
2 .Instructions to Continous Operation
As of June 30, 2011, China Bicycle Company Limited has a gross asset of RMB 150,424,997.29,
the total debt of RMB1,863,368,367.81, with its net asset up to RMB-1,712,943,370.52, in the state
of insolvency, which thus may cause this Company liquidate its assests and pay off the debts in the
normal operations. In such a case, this Company and its largets creditor will take the following
measures:
Since March 2003 when China Huarong Asset Management Corporation, the former largest creditor
of this Company, launched the debt reconstructing and made the progress to a certain extent, China
Banking Regulatory Commission and the relevant authorities approved on the exemption and stop
calculating all the interests of financial debts incurred as of Dec. 31st, 2004.
Whereas the Company signed Settlement Agreement with International Finance Corportation on
March 29th, 2007, it is hereby agreed to settle all and any creditor’s rights and debts incurred
therefore by an equivolant US dollars for RMB 2 million, with the prinical of debts approx. US$
3.87 million and the interests payable of approx. RMB 42.78 million.
73
On 15 October 2010, the Company entered into the Debt Settlement Agreement with Shenzhen
Chengxingtai Investment Co., Ltd. for RMB 14 million payment as compensation to Chengxingtai
Co., from the Company for settled the all debt and liabilities of two parties(approximately RMB
150 million). The RMB 14 million have been paid on 30 Nov. 2010 in full.
China Huarong Asset Management Corporation, on Dec. 30th, 2006, transferred its creditor’s rights
to Shenzhen Guocheng Engergy Investment & Development Corporation (hereinafter referred to as
“Guocheng Energy Corporation”) which is now performing actively the matters concerning debt
reconstructing and has made the progress to a certain extent. Whereas the largest shareholder and
creditor of this Company have changed, in January 2010, in accordance with newly-issued Law of
the People's Republic of China on Enterprise Bankruptcy, Guocheng Energy Corporation
consequently claims and applys for new reconstructing of this Company to Shenzhen Intermediate
People's Court, with a view to recover and improve the ongoing operations. On 28 Dec. 2010,
Shenzhen Intermediate People’s Court considered that the applicant provided no materials that
recognized by two parties with taxation dept. from tax and debt. According to the regulation of
Clause VIII, Rule 1 of Clause XII under Law of the People's Republic of China on Enterprise
Bankruptcy, the court judged no application of the bankruptcy restructuring on the Company from
Shenzhen Guosheng Energy Investment Developemt Co., Ltd. In addition, Guosheng Energy
suspended for calculation the loan interest of 2011 amounting to RMB 17.029 million, the interest
shall not be recoved in subsequent years.
The main business of this Company may develop stably and realize benefits continuously while
launching the debt reconstructing. In a short term, it reduced the paying pressure greatly, and ability
to continous operations has been improved to a certain degree. The Board of the Directors thought
that along with the continuous progress of the Company debts and asset reconstructing, the
operating environment, business situation and ability to continuous operations will be bound to
further improvement.
3. Change of the actual controller
In January 2011, the “Letter of Equity Transfer” was received by the Company from largest
shareholder of the Company-Shenzhen Guosheng Energy Investment Development Co., Ltd. With
this letter, the Company notice that controlling shareholder of Guosheng Energy—Shenzhen
Guomin Investment Co., Ltd. entered into the Agreement of Equity Transfer with Mr. Ji Hanfei on 3
January 2011. Guomin Investment transfer 100% equity of Guosheng Energy to Ji Hanfei with price
of RMB 70 million, industry and commerce changes have been finished.
The abovementioned equity transfer changed the actual controller of the Company. Zhang Yanfen
was the actual controller of the listed Company before equity transfer while Ji Hanfei turns to be the
actual controller of the Company after equity transfer.
4. Execution of reorganization plan for creditor-Shengrun Company
(1) In January 2011, Shenzhen Intermediate People’s Court confirmed by ruling that: credit of
232,801,657.06 yuan was transferred to transferee-Dongtaixin Company, the amount that receivable
from the Company.
(2) In April of 2011, the reorganization plan of Guangdong Shengrun Group Co., Ltd. was executed
completely that ruling by Shenzhen Intermediate People’s Court( found more in Notice of Board of
Shenrun Company dated 26th April 2011), relevant original interest and estimated liability that
withdrawal previously have been adjusted by the Company for amount decreased.
5. Application for bankruptcy reorganization to Shenzhen Intermediate People’s Court by
Creditor-Dongtaixin Company
On 30 March 2011, the one piece of “Notification” from creditor of the Company-Shenzhen
74
Dongtaixing Technology Co., Ltd. was received by the Company: for the case of no application
for bankruptcy restructuring from Shenzhen Guosheng Energy Investmetn Co., Ltd.-largest
shareholder of the Company judged from Shenzhen Intermediate People’s Court, the documents
were delivered by “Dongtaixing Company” on 17 March 2011, as second creditor, for application of
bankcrptcy restructuring for ShenChina in accordance with the law. Currently, “Dongtaixing
Company” prepared for the hearing procedures.
XI. Note of main item of financial statement of parent company
1. Receivable account
(1) Disclosued by category
Unit: RMB Currency: CNY
Amount at the end of period
Book balance Bad debt provision
Category
Proportion Proportion
Amount Amount
(%) (%)
Account receivable with single major amount - - - -
but withdrawal bed debt provision for single
item
Account receivable withdrawal bad debt 1,034,399,533. 1,033,592,642.
provision by age combination 98 100.00 50 99.92
Account receivable with single minor amount
but withdrawal bed debt provision for single
item - - - -
1,034,399,533. 1,033,592,642.
Total
98 100.00 50 99.92
Amount at the beginning of period
Book balance Bad debt provision
Category
Proportion Proportion
Amount Amount
(%) (%)
Account receivable with single major amount - - - -
but withdrawal bed debt provision for single
item
Account receivable withdrawal bad debt 1,034,374,248. 1,032,989,895.
provision by age combination 98 100.00 75 99.87
Account receivable with single minor amount
but withdrawal bed debt provision for single
item - - - -
1,034,374,248. 1,032,989,895.
Total
98 100.00 75 99.87
Interpretation to the categories of the accounts receivable:
Based on the size, business nature and customer settlement condition of the company, the company
decides that RMB 5 million of accounts receivable is important single sum of payment. The bad
debt allowance is accrued on the basis of account aging analysis method.
(2) In combination, account receivable withdrawal bed debt provision by age analysis method:
Unit: RMB Currency: CNY
Amount at period-end Amount at period-begin
Book balance Book balance Bad debt provision
Age Amount Ratio Bad debt provision Amount Ratio
(%) (%)
Within 77,227.
1year 102,512.48 0.01 307.54 48 0.01 -
75
Amount at period-end Amount at period-begin
Book balance Book balance Bad debt provision
Age Amount Ratio Bad debt provision Amount Ratio
(%) (%)
1-2
years - - - - - -
Over 1,034,2
3years 1,034,297, 97,021.
021.50 99.99 1,033,592,334.96 50 99.99 1,032,989,895.75
Total 1,034,3
1,034,399, 74,248.
533.98 100.00 1,033,592,642.50 98 100.00 1,032,989,895.75
(3) No account receivable actually cancelled after verification in the report period.
(4) The accounts receivable at the end of the report period don’t involve with the shareholder unit’s
holding over 5% (including 5%) voting power of the Company.
(5) Top 5 units with an amount of account receivable:
Unit: RMB Currency: CNY
Relationship with Proportion among the gross
Name Amount Period
the company accounts receivable - others (%)
Client 1 Non-related party 174,219,907.69 Over 3 years 16.84
Client 2 Non-related party 140,887,132.85 Over 3 years 13.62
Client 3 Non-related party 97,930,571.16 Over 3 years 9.47
Client 4 Non-related party 69,887,060.40 Over 3 years 6.76
Client 5 Non-related party 52,406,319.69 Over 3 years 5.07
Total 535,330,991.79 51.75
(6)No other account receivable involving with affiliated parties in the report period.
(7)No other account receivable-others with confirmation terminated at the end of the report period.
2. Other receivables
(1) disclosed by categories
Unit: RMB Currency: CNY
End of period
Book balance Provision for bad debts
Category
Amount Proporti Amount Proporti
on(%) on(%)
Other account receivable with single major amount - -
and withdrawal bed debt provision for single item - -
Other account receivable withdrawal bad debt
provision by age combination 559,366,717.59 100.00 526,900,582.15 94.20
Other account receivable with single minor amount
but withdrawal bed debt provision for single item - - - -
Total 559,366,717.59 100.00 526,900,582.15 94.20
Unit: RMB Currency: CNY
Beginning of period
Book balance Provision for bad debts
Category
Amount Proporti Amount Proporti
on(%) on(%)
Other account receivable with single major amount
and withdrawal bed debt provision for single item - - - -
Other account receivable withdrawal bad debt
provision by age combination 557,411,339.53 100.00 526,881,529.25 94.52
76
Other account receivable with single minor amount
but withdrawal bed debt provision for single item - - - -
Total 557,411,339.53 100.00 526,881,529.25 94.52
Interpretation to the category of accounts receivable-others:
According to the business scale, business nature, and customers’ settlement, etc., the account
receivable-other with single big amount is determined to be RMB 5 million. The reserve for bad
and doubtful account is withdrawn with age analysis method.
(2) In combination, other account receivable withdrawal bed debt provision by age analysis method:
Unit: RMB Currency: CNY
Amount at period-end Amount at period-begin
Age Book balance Bad debt Book balance Bad debt
Amount Proportion(%) provision Amount Proportion(%) provision
Within
1year 4,047,585.73 0.72 11,829.52 2,092,207.67 0.38 6,276.62
1-2
years 4,545,244.91 0.81 13,635.73 4,545,244.91 0.82 135.73
2-3
years - - - - - -
Over
3years 550,773,886.95 98.47 526,875,116.90 550,773,886.95 98.80 526,875,116.90
Total 559,366,717.59 100.00 526,900,582.15 557,411,339.53 100.00 526,881,529.25
(3) No other account receivable actually cancelled after verification in the report period.
(4) The other accounts receivable at the end of the report period don’t involve with the shareholder
units hodling over 5% (including 5%) voting power of the Company.
(5) Top 5 units with an amount of other account receivable:
Unit: RMB Currency: CNY
Proportion among the total
Relationship with
Name Amount Period other accounts receivable -
the company
others (%)
Client 1 Non-related party 220,038,935.10 Over 3 years 39.34
Client 2 Non-related party 60,359,041.39 Over 3 years 10.79
Client 3 Non-related party 30,059,193.03 Over 3 years 5.37
Client 4 Non-related party 26,012,462.08 Over 3 years 4.65
Client 5 Non-related party 20,531,780.08 Over 3 years 3.67
Total 357,001,411.68 63.82
(6)No other account receivable involving with affiliated parties in the report period.
(7)No other account receivable-others with confirmation terminated at the end of the report period.
77
3. Long-term equity investment
Unit: RMB Currency: CNY
Explanation
on
discrepancy
between
share Provision
Share Percentag
Examinatio proportion for (asset)
Initial proportion e of voting Cash
n and Increases and decreases Closing balanc in invested Depreciation depreciati
Invested company investment Opening balance in rights in divid
calculating e company reserve on of
cost invested invested end
method and current
company company
percentage period
of voting
rights in
invested
company
Shenzhen EMMELLE
Industry Co.Ltd Cost method 1,400,000.00 1,400,000.00 - 1,400,000.00 70% 70% - 1,400,000.00 - -
Shenzhen Anju property
management co.,ltd Cost method 2,000,000.00 2,000,000.00 - 2,000,000.00 100% 100% - 2,000,000.00 - -
China Bicycle(Hong
Kong) Co.,Ltd Cost method 5,350,000.00 5,350,000.00 - 5,350,000.00 99% 99% - 5,350,000.00 - -
China
Bicycle(International)
Co.,Ltd Cost method 18,727.60 18,727.60 - 18,727.60 100% 100% - 18,727.60 - -
Hunan Guangnan
Motorcycle Co.,Ltd Cost method 5,679,300.00 5,679,300.00 - 5,679,300.00 5.50% 5.50% - 5,679,300.00 - -
Shenzhen Jinhuan Equity
Printing Co.,Ltd method 14,883,560.00 14,883,560.00 - 14,883,560.00 38.00% 38.00% - 12,263,719.50 - -
Total -- 29,331,587.60 29,331,587.60 - 29,331,587.60 -- -- - 26,711,747.10 - -
78
4. Operating revenue and operating costs
(1) Operating revenue and operating costs
Unit: RMB Currency: CNY
Amount incurred at same period pf
Item Amount incurred of current period
last year
Income from main business 41,329.07 306,335.90
Income from other business 11,399,761.76 7,719,812.39
Operating cost 5,023,916.46 5,650,837.29
(2) Main business (by industy )
Unit: RMB Currency: CNY
Amount incurred of current period Amount incurred at same period pf last year
Products
Business income Business cost Business income Business cost
Sales of bicycle and
spare parts 41,329.07 41,329.07 306,335.90 306,335.90
(3) Main business (by category )
Unit: RMB Currency: CNY
Amount incurred of current period Amount incurred at same period pf last year
Products
Business income Business cost Business income Business cost
CBC electric
- - 254,102.56 254,102.56
CBC bicycle
41,329.07 41,329.07 52,233.34 52,233.34
Total
41,329.07 41,329.07 306,335.90 306,335.90
5. Supplemental Information of cash flow statement
Unit: RMB Currency: CNY
Amount of
Supplemental Information Amount of this period same period of
last year
1. Reconciliation of net profit/(loss) to cash
flows from operating activities:
Net profit 26,975,990.16 -51,100,009.82
plus: provision for assets 621,799.65 -
Depreciation of fixed assets, oil/gas asset depletion and depreciation of productive
biological assets 4,953,892.36 5,131,310.57
Amortization of intangible assets 431,431.02 431,431.02
Amortization of long-term prepaid expenses - -
Loss on disposal of fixed assets, intangible assets and others (income listed with “-“) - -
Losses on disposal of fixed assets (income listed with “-“) - -
Losses on the changes in fair value (income listed with “-“) - -
Financial expenses (income listed with “-“) 16,863,378.57 43,238,651.88
Losses arising from investments (income listed with “-“) - -
Decrease of deferred income tax assets (increased listed with “-“) - -
Increase of deferred income tax liabilities (decreased listed with “-“) - -
Decrease in inventories (increased listed with “-“) 41,329.07 46,113.67
Decrease in operating payables (increased listed with “-“) -2,010,663.06 9,395,737.25
Increase in operating payables (decreased listed with “-“) -47,832,696.71 -4,635,277.94
Others - -
Net cash flows from operating activities 44,461.06 2,507,956.63
2.Investing and financing activities that do notconcerning cash receipts and payment:
Conversion of debt into capital - -
Reclassification of convertible bon expiring within one year as current liability - -
Financial leasing of fixed assets - -
3. Net change of cash and cash equivalents:
Closing balance of cash 529,240.47 434,361.44
Minus: opening balance of cash 498,624.71 365,121.06
79
Amount of
Supplemental Information Amount of this period same period of
last year
Plus: closing balance of cash equivalents - -
Minus: opening balance of cash equivalents - -
Net increase of cash and cash equivalents 30,615.76 69,240.38
XII. Supplement information
1. List of non-recurring profit and loss
Unit: RMB Currency: CNY
Item Amount of this period Explanation
Loss and profit on disposal of non-current assets - -
Tax return or exemption from override approval or with no
- -
official approval document
The amount of the government subsidies which are
included in the current profits( which is related to
- -
enterprise business, except for government subsidies
according to national stand quota or quantum)
Paid or received payment for use of state funds recorded in
- -
current profit and Losss
Profits and losses arising from business combination when
the combined cost is less than the recognized fair value of - -
net assets of the merged company
Loss and profit of exchange of non-monetary assets - -
Loss and profit by entrusting others to invest and manage
- -
the asset
Allotted asset depreciation reserves incurred by occasional
- -
cause such as natural calamities
Gains and losses from debt restructuring - -
Expense for enterprise reconstruction, employee
- -
arrangement and other integration costs
Profit and loss from transactions with obvious unfair
- -
transaction price
Subsidiaries' year-to-date net profit/loss arising from
business combination of entities controlled by a same - -
company
Profits contributed by the sold assets to the listed company
- -
from The beginning of the year To the sale date
Except for effective hedging business related to normal
business, held-for-trading financial asset, profit and losses
on the changes in fair value generated by transaction
- -
financial liabilities, investment income achieved by
disposing transaction financial assets, transaction financial
liabilities and hold-to-sale financial assets
Reversals of depreciation reserves of receivables done
- -
depreciation test solely
Loss and profit achieved by entrusting loans - -
Profit and loss on the changes in fair value of invested real
estate after being subsequently measured with fair value - -
mode
According to laws and regulations of tax and accounting,
impact of One-off adjustment of current loss and profit on - -
current loss and profit
Trustee fee income generated from entrusted operation - -
Other non-operating income and expenses 47,802,429.29 -
Other loss/profit generated by definition of other non
- -
recurring profit and loss
Amount influenced by income tax - -
Amount influenced by few shareholders’ equity(after-tax) - -
80
Item Amount of this period Explanation
Total 47,802,429.29 -
2. Net assets income rate and earnings per share
Earnings per share
Average weight ROE
Profit during the period of report Basic earnings per Dilute earnings per
(%)
share share
Net profit attributed to shareholders - 0.0475 0.0475
Net profit attributed to shareholders
after deducting net profit of recurring - -0.0392 -0.0392
loss and profit
3. Reason and explanation of unusual circumstance of items of financial statement of the
company
Unit: RMB Currency: CNY
Proportion of
Change of
change in the
amount at the
beginning of
beginning of
period and at
Items period and at the Explanation
the end of
end of period or
period or same
same period of
period of last
last year
year
Mainly due to the changes of settlement for sale
-1,373,931.00
Note recerivable -52.45% business
Inventory 17,826,231.26 82.18% Mainly for the inventory for peak season in sales
Account paid in The account received in advance for goods increased
5,934,226.14
advance 35.62% in sales peak season
Other account Changes of the creditors, relevant accountan item
233,224,738.84
payable 140.63% adjusted
Non-current
liability due Changes of the creditors, relevant accountan item
within one year -243,098,376.97 -34.40% adjusted
Financial Exchange profit was produced from RMB
expenses -26,366,926.77 -61.02% appreciation and decrease of the debt interests
The reorganization plan of Shengrun Co., was
executed completely that ruling by Court. The debts
and predicted liability that withdrawal previously
have been adjusted by the Company for amount
Non-operating reducted in book.
income 47,036,236.52 5,885.69%
Legal representative: Date:
Principal in charge of accounting: Date:
Principal of accounting organ: Date:
81
