深圳中恒华发股份有限公司 2016 年年度报告全文
SHENZHEN ZHONGHENG HWAFA CO., LTD.
ANNUAL REPORT 2016
April 2017
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深圳中恒华发股份有限公司 2016 年年度报告全文
Section I. Important Notice, Contents and Paraphrase
Board of Directors, Supervisory Committee, all directors, supervisors and senior
executives of Shenzhen Zhongheng Hwafa Co., Ltd. (hereinafter referred to as
the Company) hereby confirm that there are no any fictitious statements,
misleading statements, or important omissions carried in this report, and shall
take all responsibilities, individual and/or joint, for the reality, accuracy and
completion of the whole contents.
Li Zhongqiu, Principal of the Company, Yang Bin, person in charger of
accounting works and Wu Aijie, person in charge of accounting organ
(accounting principal) hereby confirm that the Financial Report of 2015 Annual
Report is authentic, accurate and complete.
Other directors attending the Meeting for annual report deliberation except for
the followed
Name of director absent Title for absent director Reasons for absent Attorney
Xu jinwen Independent director - Li Ding’an
Concerning the forward-looking statements with future planning involved in the
Report, they do not constitute a substantial commitment for investors. Majority
investors are advised to exercise caution of investment risks.
Risks factors are being well-described in the Report, found more in risks factors
and countermeasures disclosed in Prospects for Future Development of the
Board of Directors’ Report.
The Company has no plan of cash dividends carried out, bonus issued and
capitalizing of common reserves either.
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深圳中恒华发股份有限公司 2016 年年度报告全文
Contents
Section I Important Notice, Contents and Paraphrase ................................................................. 2
Section II Company Profile and Main Finnaical Indexes ............................................................. 9
Section III Summary of Company Business .................................................................................. 9
Section IV Discussion and Analysis of Operation ........................................................................ 11
Section V Important Events .......................................................................................................... 27
Section VI Changes in shares and particular about shareholders............................................... 34
Section VII Preferred Stock……………………………………………………………………….47
Section VIII Particulars about Directors, Supervisors,Senior Executives and Employees ...... 35
Section IX Corporate Governance ................................................................................................. 56
Section X Corporate Bonds ........................................................................................................... 64
Section XI Financial Report ............................................................................................................ 51
Section XII Documents Available for Reference ........................................................................... 51
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深圳中恒华发股份有限公司 2016 年年度报告全文
Paraphrase
Items Refers to Contents
Company, Shen Hwafa Refers to SHENZHEN ZHONGHENG HWAFA CO., LTD.
Hengfa Technology Refers to Wuhan Hengfa Technology Co., Ltd.
Hwafa Property Refers to Shenzhen Zhongheng Hwafa Property Co., Ltd
Hwafa Lease Refers to Shenzhen Hwafa Property Lease Management Co., Ltd
Hwafa Trade Refers to Wuhan Zhongheng Hwafa Trade Co., Ltd.
Wuhan Zhongheng Group Refers to Wuhan Zhongheng New Science & Technology Industrial Group Co., Ltd.
HK Yutian Refers to Hong Kong Yutian International Investment Co., Ltd.
Hengsheng Photoelectricity Refers to Wuhan Hengsheng Photoelectricity Industry Co., Ltd.
Hengsheng Yutian Refers to Wuhan Hengsheng Yutian Industrial Co., Ltd.
Yutian Henghua Refers to Shenzhen Yutian Henghua Co., Ltd.
Hwafa Hengtian Refers to Shenzhen Hwafa Hengtian Co., Ltd.
Hwafa Hengtai Refers to Shenzhen Hwafa Hengtai Co., Ltd.
Shenzhen Vanke Refers to Shenzhen Vanke Real Estate Co., Ltd.
Vanke Guangming Refers to Shenzhen Vanke Guangming Real Estate Development Co., Ltd
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深圳中恒华发股份有限公司 2016 年年度报告全文
Section II Company Profile and Main Finnaical Indexes
I. Company profile
Short form of the stock Shen Hwafa A, Shen Hwafa B Stock code 000020, 200020
Short form of the stock after
N/A
changed (if applicable)
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in
深圳中恒华发股份有限公司
Chinese)
Short form of the Company
深华发
(in Chinese)
Foreign name of the Company
SHENZHEN ZHONGHENG HUAFA CO., LTD.
(if applicable)
Abbr. of the foreign name (if
N/A
applicable)
Legal representative Li Zhongqiu
Registrations add. 411 Bldg., Huafa (N) Road, Futian District, Shenzhen
Code for registrations add 518031
Offices add. 33/F, No. 2 Building of Dachong Business Center, Nanshan District, Shenzhen
Codes for office add. 518057
Company’s Internet Web Site http://www.hwafa.com.cn
E-mail hwafainvestor@126.com.cn
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Yang Bin Niu Yuxiang
33/F, No. 2 Building of Dachong Business 33/F, No. 2 Building of Dachong Business
Contact add.
Center, Nanshan District, Shenzhen Center, Nanshan District, Shenzhen
Tel. 0755-86360220 0755-86360201
Fax. 0755-86360206 0755-86360206
E-mail hwafainvestor@126.com.cn hwafainvestor@126.com.cn
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深圳中恒华发股份有限公司 2016 年年度报告全文
III. Information disclosure and preparation place
Newspaper appointed for information disclosure China Securities Journal; Securities Times; Hong Kong Commercial Daily
Website for annual report publish appointed by CSRC http://www.cninfo.com.cn
Preparation place for annual report Office of the Board of SHENZHEN ZHONGHENG HWAFA CO., LTD.
IV. Registration changes of the Company
Organization code Before change: 61883037-2; after changed: 91440300618830372G
Before the change of controlling shareholders: the main business was production and
sales of color TV, printed circuit board and injection molded parts etc. After the change
Changes of main business since listing (if
of controlling shareholders: the main business gradually adjusted to production and
applicable)
sales of injection molded parts, foam part (light packaging materials) and LCD whole
machine.
The Company’s predecessor was Shenzhen Huafa Electronic Co., LTD, which was
founded in 1981, initiated and established by three legal persons-- Shenzhen
Electronics Group Co., LTD, China Zhenhua Electronic Group Co., LTD and Hong
Kong Luks Industrial Co., LTD. In June 2005, Wuhan Zhongheng Group transferred
Previous changes for controlling the 44.12% equity of company, held by original first and second largest shareholder of
shareholders (if applicable) the Company Shenzhen Electronics Group Co., LTD and China Zhenhua Electronic
Group Co., LTD, and equity transfer formalities completed in April 2007; Wuhan
Zhongheng Group became the controlling shareholder of the Company. In September
2007, the company officially changed its name to “Shenzhen Zhongheng Hwafa Co.,
Ltd”.
V. Other relevant information
CPA engaged by the Company
Name of CPA DAXIN Certified Public Accountants LLP
Offices add. for CPA 15/F College International Mansion, No.1 Zhi Chun Road, Haidian Distric, Beijing
Signing Accountants Li Wei, Fan Zhang
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
VI. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data for accounting policy changed and accounting
error correction or not
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深圳中恒华发股份有限公司 2016 年年度报告全文
√ Yes □No
Changes over
2015 2014
last year
2016
Post-adjustmen Post-adjustmen Post-adjustmen
Pre-adjustment Pre-adjustment
t t t
Operating income (RMB) 619,167,770.74 499,455,781.11 499,455,781.11 23.97% 694,839,760.10 694,839,760.10
Net profit attributable to
shareholders of the listed 5,457,710.33 -6,731,513.11 -4,200,845.61 - 7,687,620.27 7,687,620.27
company(RMB)
Net profit attributable to
shareholders of the listed
company after deducting 5,109,926.82 -31,741,774.80 -29,211,107.30 - 2,322,082.33 2,322,082.33
non-recurring gains and
losses(RMB)
Net cash flow arising from
-18,693,296.58 173,486,015.99 173,486,015.99 -110.78% 119,492,159.01 119,492,159.01
operating activities(RMB)
Basic earnings per share
0.0193 -0.0238 -0.0148 - 0.0271 0.0271
(RMB/Share)
Diluted earnings per share
0.0193 -0.0238 -0.0148 - 0.0271 0.0271
(RMB/Share)
Return on Equity 1.72% -2.27% -1.50% 3.22% 2.77% 2.77%
Changes over
End of 2015 End of 2014
end of last year
End of 2016
Post-adjustmen Post-adjustmen Post-adjustmen
Pre-adjustment Pre-adjustment
t t t
1,155,089,236. 1,154,989,593. 1,162,740,984. 1,162,740,984.
Total assets (RMB) 632,475,542.40 -45.24%
67 34 93 93
Net assets attributable to
shareholder of listed company 319,698,568.63 311,406,562.20 313,937,229.70 1.84% 281,351,269.74 281,351,269.74
(RMB)
The reasons for the changes in accounting policies and the correction of accounting errors
1. The company mistakenly disbursed cash deposit from the rent of 2015, which was corrected and adjusted to administration
expenses and rental fees, increased the administration expenses of 2015 by RMB 99,643.33, and reduced other receivables by RMB
99,643.33.
2. The company collected the financing income of T2 class trust units in trust plan of 2015 CITIC QianjingGreen Xingcheng
investment funds and accrued the business tax and additional tax which were identified not belonging to the business tax scope and
were corrected and returned back, reduced taxes and additional of 2015 by RMB 3,473,866.67, and reduced tax payable (business tax,
urban maintenance and construction tax, education surcharge, local education surcharge) by RMB 3,473,866.67.
3. The correction of above two items made impacts on the income tax and undistributed profits, increased income tax expenses by
RMB 843,555.84, increased tax payable (corporate income tax) by RMB 843,555.84, and increased undistributed profit by
RMB2,530,667.50.
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深圳中恒华发股份有限公司 2016 年年度报告全文
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International
Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or
Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VIII. Quarterly main financial index
In RMB
1st Q 2nd Q 3rd Q 4th Q
Operating income 137,699,187.33 171,839,338.23 147,394,897.89 162,234,347.29
Net profit attributable to
469,935.69 6,803,020.53 -2,763,587.66 948,341.77
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
137,244.07 6,045,229.45 -3,187,589.84 2,365,523.69
after deducting non-recurring gains
and losses
Net cash flow arising from
-46,008,442.75 20,584,093.18 -45,645,033.67 52,376,086.66
operating activities
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in the company’s quarterly report and semi-annual report
□Yes √ No
IX. Items and amounts of extraordinary profit (gains)/loss
√Applicable □ Not applicable
In RMB
Item 2016 2015 2014 Note
Gains/losses from the disposal of
82,132.08 449,051.44 1,587,819.80
non-current asset (including the write-off
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深圳中恒华发股份有限公司 2016 年年度报告全文
that accrued for impairment of assets)
Governmental subsidy reckoned into current
gains/losses (not including the subsidy
enjoyed in quota or ration according to 1,419,888.89 1,691,800.00 4,159,795.00
national standards, which are closely
relevant to enterprise’s business)
Other non-operating income and expenditure
-1,209,982.33 690,149.43 149,500.69
except for the aforementioned items
Other gain/loss items satisfying the
333,974.06 25,247,171.27 983,612.12
definition of nonrecurring gain/loss account
Less: Impact on income tax 278,229.19 3,067,910.45 1,515,189.67
Total 347,783.51 25,010,261.69 5,365,537.94 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss, explain reasons
□ Applicable √ Not applicable
In reporting period, the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of
extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to
the Public --- Extraordinary Profit/loss
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深圳中恒华发股份有限公司 2016 年年度报告全文
Section III Summary of Company Business
I. Main businesses of the company in the reporting period
Whether the company needs to comply with the disclosure requirements of the particular industry
No
After years of development, the company has gradually formed two main businesses in industry and property
management. Among them, the industrial business mainly includes injection molding, foam pieces (light-weight
packaging materials), and complete machine production and sales of liquid crystal display, property management
business is mainly the lease of its own property.
The company's industrial business mainly provides auxiliary products and services for the home appliance
industry. With the acceleration of new urbanization process in China and upgrading and updating of household
appliance consumption, the home appliance industry will continue to maintain a relatively fast growth; the
development of home appliances and other downstream industries provides broad markets for the upstream
auxiliary products. By virtue of years of industry resources and technology accumulation, the company conforms
to the market demand and optimizes the product structure and performance, and the company's products and
services have accepted by the downstream manufacturers such as Gree, Haier, TCL, etc. and possess certain
competitiveness in the industry. But it also should be noted that the current injection molding, foam pieces and
liquid crystal display business are facing fierce market competition and cost pressures, the company needs to
further enhance the level of research and development, develop new products, expand downstream channels and
cultivate its own brand so as to further enhance the profitability in industrial business.
On the other hand, the transformation and upgrading and profitability of industrial business are weaker than
expectation in recent years, under this circumstance, the company has actively developed the property
management business, liquidized the remnant assets, and carried out the decoration and investment promotion of
its own property Huafa Building, the property management business has made good profits for the company and
became an important strategic business of the company.
II. Major changes in main assets
1. Major changes in main assets
Major assets Note of major changes
Equity assets N/A
Fixed assets Shops are transfers as investment real estate in the Period, fixed assets declined
Intangible assets No major change
Construction in progress No major change
reconstruction of old buildings and Electronic City in Gongming are transferred to
Classified as assets held for sale
disposal of fixed assets from assets held-for-sale
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深圳中恒华发股份有限公司 2016 年年度报告全文
Fixed assses disposal The same as above
2. Main overseas assets
□ Applicable √ Not applicable
III. Core competitiveness analysis
Whether the company needs to comply with the disclosure requirements of the particular industry
No
1. All industrial lands of the Company located in Shenzhen were taken into the first batch of plan under 2010 Shenzhen urban
upgrade planning. In the future, development and operation of self-owned land resources would become the income source of the
Company on a long-term and stable basis.
2. The Company has three plants in Wuhan economic technology park with an area of nearly 90,000 square meters where various
famous enterprises are located in this area. Benefiting from radiation radius requirements for processing matching services, the
Company enjoys superior and stable customer resources and has established a good long-term cooperative relationship; in particular,
its injection molding business and polystyrene businesses have been operated for many years with steady management group and
abundant production experiences, which makes the Company enjoying high recognition and annual production capacity and scale in
the forefront of Central China.
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深圳中恒华发股份有限公司 2016 年年度报告全文
Section IV Discussion and Analysis of Operation
1. Introduction
In 2016, China's economy has shown a steady operation trend as a whole, the home-appliance industry has
increased, but lacked motivation, as an industrial manufacturing enterprise providing supporting products and
services for home appliance industry, the Company actively adapted to the national economic policies and
industry changes, solved difficulties and problems, positively responded, and turned the losses into gains. In 2016,
the company achieved operating income of 619,167,800 Yuan, an increase of 23.97% compared with the same
period of last year; net profit of5,457,700 Yuan, and turned the losses into gains.
● Injection molding business achieved annual operating income of 188,550,900 Yuan, a decrease of 2.24 %
compared with the same period of last year. When the overall market had a poor performance, the injection
molding division focused on maintaining customer relationships, and enhanced the customer share by strategy
adjustment; strengthened the fine management, improved product quality, developed effective quality corrective
measures, strictly controlled the quality, and maintained a good quality and reputation; after introducing some
advanced production equipment, once again updated some old injection molding machines, further implemented
the automation improvement and process optimization progress, reduced human input and waste of production
materials, and improved production efficiency; at the same time, strengthened the internal management,
introduced the competition mechanism, paid attention to staff training, improved staff quality, practically
completed the staff logistics services, and enhanced the company's cohesive force and centripetal force.
● Polystyrene business achieved annual operating income of 68,514,600 Yuan, a decrease of 11.87% compared
with the same period of last year. Faced with the rise in raw material prices, increase of human resource costs,
decline in sales prices, and fierce competition in the market, the polystyrene business division adhered to taking
market demand as the guiding, and continued to expand the market share by adjusting the product structure; while
focused on improving the product quality and reducing the raw material loss, and formed its own unique
competitive advantages. However, due to the intensifying market competition, rising production costs, and
declining product prices, the profit margins reduced. In the future, the company shall take the thought of
promoting development by innovation, and further improve the market competitiveness and expand the market
shares by technological innovation, market innovation, resource utilization innovation, management innovation
and product optimization.
● LCD business achieved annual operating income of 312,991,900 Yuan, an increase of 67.52% compared with
the same period of last year. During the reporting period, the video division continued to invest more energies in
the design and development of new products, newly increased various sizes of LCD new series with more cost
advantages and realized mass production, developed from the traditional structure to ultra-thin, ultra-narrow and
larger sized curve LCDs. The video division focused on product innovation, developed from the single product
sizes to multi-series and multi-sizes product line, and has LIF series, G series, FIM series, C350 curve series
products with completely independent designs and tooling; in the second half year of 2016, the company
successfully introduced the new customer, Taiwan brand “ACER”, which has developed into four major
customers, including the existing customer base (AOC system), American brand Viewsonic , Taiwan brand
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深圳中恒华发股份有限公司 2016 年年度报告全文
(ACER), and its own brand (HSO); realized the globalization of sales area, and the products produced by our
company spread over our country, Asia-Pacific, Europe, North America and other regions; at the same time,
increased the e-commerce sales channels, and achieved steady growth in sales revenue.
● Property leasing business has realized an annual operation revenue of 39,501,900 Yuan, a decrease of 18.72%
compared with the same period of last year. Most sites of the company’s own property Huafa Building have
signed the lease, shops have opened one after another, the sites in idle have substantially reduced, and the average
rental price has increased in some extent than the past, but the company's own property Gongming Huafa
Electronic City has entered the demolition stage of updating and reconstruction, lessees have continued to remove
and the rental income has relatively reduced, therefore, the company’s overall rental income of 2016 is lower that
the previous years.
II. Main business analysis
1. Introduction
See the “I-Introduction” in “Discussion and Analysis of Operation”
2. Revenue and cost
(1) Constitute of operation revenue
In RMB
2016 2015
Increase/decrease
Ratio in operation Ratio in operation
Amount Amount y-o-y
revenue revenue
Total operation
619,167,770.74 100% 499,455,781.11 100% 23.97%
revenue
According to industries
Display 312,991,895.11 50.55% 186,838,010.48 37.41% 67.52%
Plastic injection
188,550,863.79 30.45% 192,872,402.89 38.62% -2.24%
hardware
Foam 68,514,616.64 11.07% 61,245,929.61 12.26% 11.87%
Property leasing 39,501,885.54 6.38% 48,600,894.50 9.73% -18.72%
Scrap income 2,385,455.00 0.39% 605,216.55 0.12% 294.15%
Utilities and other 7,223,054.66 1.16% 9,293,327.08 1.86% -22.28%
According to products
Display 312,991,895.11 50.55% 186,838,010.48 37.41% 67.52%
Plastic injection
188,550,863.79 30.45% 192,872,402.89 38.62% -2.24%
hardware
Foam 68,514,616.64 11.07% 61,245,929.61 12.26% 11.87%
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深圳中恒华发股份有限公司 2016 年年度报告全文
Property leasing 39,501,885.54 6.38% 48,600,894.50 9.73% -18.72%
Scrap income 2,385,455.00 0.39% 605,216.55 0.12% 294.15%
Utilities and other 7,223,054.66 1.16% 9,293,327.08 1.86% -22.28%
According to region
Hong Kong 211,129,139.32 34.10% 174,132,782.70 34.86% 21.25%
Central China 363,057,765.71 58.64% 269,008,886.38 53.86% 34.96%
South China 44,980,865.71 7.26% 56,314,112.03 11.28% -20.13%
(2) About the industries, products, or regions accounting for over 10% of the company’s operating income
or operating profit
√Applicable □ Not applicable
Whether the company needs to comply with the disclosure requirements of the particular industry
No
In RMB
Increase/decrease Increase/decrease Increase/decrease
Operating
Operating cost Gross profit ratio of operating of operating cost of gross profit
revenue
revenue y-o-y y-o-y ratio y-o-y
According to industries
Display 312,991,895.11 296,647,708.72 5.22% 67.52% 69.39% -1.05%
Plastic injection
188,550,863.79 167,790,191.90 11.01% -2.24% -5.23% 2.80%
hardware
Foam 68,514,616.64 60,277,411.68 12.02% 11.87% 9.14% 2.20%
Property leasing 39,501,885.54 1,832,841.70 95.36% -18.72% 11.70% -1.26%
According to products
Display 312,991,895.11 296,647,708.72 5.22% 67.52% 69.39% -1.05%
Plastic injection
188,550,863.79 167,790,191.90 11.01% -2.24% -5.23% 2.80%
hardware
Foam 68,514,616.64 60,277,411.68 12.02% 11.87% 9.14% 2.20%
Property leasing 39,501,885.54 1,832,841.70 95.36% -18.72% 11.70% -1.26%
According to region
Hong Kong 211,129,139.32 200,106,179.11 5.22% 21.25% 17.83% 2.75%
Central China 363,057,765.71 328,044,861.99 9.64% 34.96% 37.02% -1.36%
South China 44,980,865.71 6,585,571.92 85.36% -20.13% -24.86% 0.92%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main business based on
latest one year’s scope of period-end
□ Applicable √ Not applicable
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深圳中恒华发股份有限公司 2016 年年度报告全文
(3) Income from physical sales larger than income from labors
√ Yes □ No
Increase/decrease
Industries Item Unit 2016 2015
y-o-y
Sales volume Set 811,394 427,752 89.69%
Display Output Set 808,745 433,807 86.43%
Storage Set 24,621 27,270 -9.71%
Sales volume Ton 11,182 10,572 5.77%
Plastic injection
Output Ton 11,450 10,412 9.97%
hardware
Storage Ton 670 402 66.67%
Sales volume Ton 3,918 3,221 21.64%
Foam Output Ton 4,006 3,126 28.15%
Storage Ton 372 284 30.99%
Reasons for y-o-y relevant data with over 30% changes
√Applicable □ Not applicable
Sales volume increased for display mainly due to the sales increased from a year eariler; Output increased for display mainly due to
the sales volume increased from a year eariler; Storage for plastic injection hardware increased mainly due to the inventory for
year-end; storage for foam increased mainly due to the inventory for year-end.
(4) Fulfillment of the company’s signed significant sales contracts up to this reporting period
□ Applicable √ Not applicable
(5) Constitute of operation cost
Classification of products
Classification of products
In RMB
2016 2015
Increase/decrease
Industries Item Ratio in operation Ratio in operation
Amount Amount y-o-y
cost cost
Display Raw materials 286,810,241.68 96.68% 166,905,693.27 95.31% 1.37%
Display Labor wages 4,308,058.58 1.45% 4,676,548.70 2.67% -1.22%
Display Depreciation 991,591.74 0.33% 1,028,419.25 0.59% -0.26%
Plastic injection
Raw materials 151,841,264.00 90.49% 152,630,151.77 86.21% 4.28%
hardware
Plastic injection
Labor wages 9,626,323.95 5.74% 11,370,871.26 6.42% -0.68%
hardware
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深圳中恒华发股份有限公司 2016 年年度报告全文
Plastic injection
Depreciation 4,344,035.13 2.59% 5,150,439.15 2.91% -0.32%
hardware
Foam Raw materials 33,860,390.08 56.17% 32,237,281.52 58.37% -2.20%
Foam Labor wages 9,931,093.00 16.48% 7,477,324.02 13.54% 2.94%
Foam Depreciation 1,589,128.86 2.64% 1,687,918.28 3.06% -0.42%
Foam Energy 10,391,245.05 17.24% 6,561,685.46 11.88% 5.36%
Explanation
Cost of main business amounting to 524,715,312.3 Yuan, including 296,647,708.72 Yuan for display, 167,790,191.9 Yuan for plastic
injection hardware and 60,277,411.68 Yuan for foam.
(6) Whether the changes in the scope of consolidation in Reporting Period
□Yes √No
(7) Major changes or adjustment in business, product or service of the Company in Reporting Period
□ Applicable √ Not applicable
(8) Major sales and main suppliers
Major sales client of the Company
Total top five clients in sales (RMB) 497,303,980.15
Proportion in total annual sales volume for top five clients 80.32%
Ratio of related parties in annual total sales among the top
31.30%
five clients
Information of top five clients of the Company
Serial Clients Sales (RMB) Proportion in total annual sales
1 No. 1 193,821,823.74 31.30%
2 No. 2 145,403,078.79 23.48%
3 No. 3 70,581,453.98 11.40%
4 No. 4 47,769,530.19 7.72%
5 No. 5 39,728,093.45 6.42%
Total -- 497,303,980.15 80.32%
Other situation of main clients
□ Applicable √ Not applicable
Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 324,957,505.58
Proportion in total annual purchase amount for top five
66.33%
suppliers
Ratio of related parties in annual total sales among the top 42.58%
16
深圳中恒华发股份有限公司 2016 年年度报告全文
five suppliers
Information of top five suppliers of the Company
Serial Supplier Purchase (RMB) Proportion in total purchase
1 No. 1 160,560,343.18 32.77%
2 No. 2 79,985,178.32 16.33%
3 No. 3 48,070,877.55 9.81%
4 No. 4 18,526,666.66 3.78%
5 No. 5 17,814,439.87 3.64%
Total -- 324,957,505.58 66.33%
Other notes of main suppliers
□ Applicable √ Not applicable
3. Expenses
In RMB
Increase/decrease
2016 2015 Note of major changes
y-o-y
Sales expense 11,415,270.82 11,427,705.20 -0.11%
Administrative expense 50,261,495.60 42,691,408.13 17.73%
Long-term loans are paid in the Period
Financial expense 5,012,897.34 48,393,716.52 -89.64%
and interest expenditure declined.
4. R&D investment
□ Applicable √ Not applicable
5. Cash flow
In RMB
Item 2016 2015 Y-o-y changes
Subtotal of cash in-flow from
644,747,922.80 809,852,026.90 -20.39%
operation activity
Subtotal of cash out-flow from
663,441,219.38 636,366,010.91 4.25%
operation activity
Net cash flow from operation
-18,693,296.58 173,486,015.99 -110.78%
activity
Subtotal of cash in-flow from
335,222,336.06 899,643.49 37,161.69%
investment activity
17
深圳中恒华发股份有限公司 2016 年年度报告全文
Subtotal of cash out-flow from
341,328,243.65 28,607,045.58 1,093.16%
investment activity
Net cash flow from investment
-6,105,907.59 -27,707,402.09 77.96%
activity
Subtotal of cash in-flow from
249,042,766.85 1,392,607,137.79 -82.12%
financing activity
Subtotal of cash out-flow from
752,494,340.83 932,953,458.09 -19.34%
financing activity
Net cash flow from financing
-503,451,573.98 459,653,679.70 -209.53%
activity
Net increased amount of cash
-528,831,643.19 610,454,809.04 -186.63%
and cash equivalent
Main reasons for y-o-y major changes in aspect of relevant data
√Applicable □ Not applicable
Net cash flow from operation activity decreased on a y-o-y basis: cash paid for purchasing goods and receiving labor service are
increased from a year earlier;
Cash in-flow from investment activity increased on a y-o-y basis: principal of the short-term financial products received in the
Period;
Cash out-flow from investment activity increased on a y-o-y basis: purchasing short-term financial products in the Period;
Net cash flow from investment activity increased on a y-o-y basis: purchasing shops along the street last period;
Cash in-flow from financing activity decreased on a y-o-y basis: other cash with financing activities concerned received last period;
Net cash flow from financing activity decreased on a y-o-y basis: other cash with financing activities concerned received last period;
Net increased amount of cash and cash equivalent decreased on a y-o-y basis: long-term loans are paid in the period.
Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
□ Applicable √ Not applicable
III. Analysis of the non-main business
√Applicable □Not applicable
In RMB
Amount Ratio in total profit Note Whether be sustainable
Income from short-term
Investment income 333,974.06 3.85% No
financial products
Mainly due to current
Asset impairment 3,546,936.86 40.85% accrued for other account No
receivable bad debt losses
Non-operating Liquidated damages and
5,533,431.78 63.73% No
income government grants
Non-operating 5,241,393.14 60.36% Loss of transfer of creditor’s No
18
深圳中恒华发股份有限公司 2016 年年度报告全文
expense rights
IV. Assets and liability
1. Major changes of assets composition
In RMB
End of 2016 End of 2015
Ratio
Ratio in total Ratio in total Notes of major changes
Amount Amount changes
assets assets
Monetary fund 93,332,709.81 14.76% 662,115,464.19 57.33% -42.57% Long-term loans are paid in the period
Account 139,808,058.2
22.10% 109,965,992.14 9.52% 12.58%
receivable 0
Inventory 46,902,384.80 7.42% 27,132,125.91 2.35% 5.07%
Investment real
54,145,225.02 8.56% 30,019,906.66 2.60% 5.96%
estate
Long-term equity
0.00% 0.00% 0.00%
investment
Fix assets 81,544,707.02 12.89% 110,607,425.50 9.58% 3.31%
Construction in
654,356.00 0.10% 654,356.00 0.06% 0.04%
process
181,210,467.8
Short-term loans 28.65% 119,479,107.41 10.34% 18.31%
1
Long-term loans 0.00% 554,700,000.00 48.03% -48.03% Long-term loans are paid in the period
2. Assets and liability measured by fair value
□ Applicable √ Not applicable
3. Assets right restriction till end of reporting period
Wuhan Zhongheng Group Co., Ltd. and Shenzhen Vanke were applied for arbitration due to the dispute case of
“Contract for the Cooperative Operation of the Old Projects at Huafa Industrial Park, Gongming Street,
Guangming New District”. On October 28, 2016, Wuhan Zhongheng Group and the company received the (2016)
Yue 03 Cai Bao No. 51 civil ruling paper sent by Shenzhen Intermediate People's Court of Guangdong Province,
which ruled to seal up and freeze the property of RMB 190 million under the name of the respondents Wuhan
Zhongheng Group and the company. See details on the company’s announcement published at
www.cninfo.com.cn on November 1, 2016.
19
深圳中恒华发股份有限公司 2016 年年度报告全文
V. Investment
1. Overall situation
□ Applicable √ Not applicable
2. The major equity investment obtained in the reporting period
□ Applicable √ Not applicable
3. The major non-equity investment doing in the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
□ Applicable √ Not applicable
The Company has no securities investment in the Period.
(2) Derivative investment
□ Applicable √ Not applicable
The Company has no derivatives investment in the Period.
5. Application of raised proceeds
□ Applicable √ Not applicable
The Company has no application of raised proceeds in the Period.
VI. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company had no sales of major assets in the reporting period.
2. Sales of major equity
□ Applicable √ Not applicable
VII. Analysis of main holding company and stock-jointly companies
√Applicable □ Not applicable
20
深圳中恒华发股份有限公司 2016 年年度报告全文
Particular about main subsidiaries and stock-jointly companies net profit over 10%
In RMB
Company Main Operating Operating
Type Register capital Total assets Net Assets Net profit
name business revenue profit
Hengfa
Production
Technolog Subsidiary 181,643,111.00 457,304,290.56 211,520,187.43 574,186,905.03 8,289,757.11 7,376,004.65
sales
y company
Hwafa Property
Property Subsidiary manageme 1,000,000.00 21,300,684.80 -885,178.62 1,433,451.07 -800,289.35 -800,639.35
Company nt
Hwafa Property
Lease Subsidiary manageme 1,000,000.00 1,900,692.20 -5,026,990.71
Company nt
Hwafa Property
Hengtian Subsidiary manageme 1,000,000.00 998,083.86 998,083.86 -1,019.94 -1,019.94
Company nt
Hwafa Property
Hengtai Subsidiary manageme 1,000,000.00 998,812.01 998,812.01 -1,017.54 -1,017.54
Company nt
Particular about subsidiaries obtained or disposed in report period
□Applicable √Not applicable
Explanation
VIII. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
IX. Future Development Prospects
(I) Industry development and market analysis
Looking ahead 2017, the global economy is complex and changeable, the domestic economic growth is slowing
down, the cost rise challenges the operational capacity of enterprises, the real estate industry is weakening its
supporting role under the policy regulation, exchange rate fluctuations and trade protectionism intensify, the
growth of home appliance industry is still facing big pressure.
In 2017, the product upgrading and transformation is still the main theme of the development of home appliances
industry. In the context of continuing to deepen the “structural reform of the supply side”, the transformation and
upgrading of home appliance industry and the upgrading of consumption continue to promote, the home appliance
industry with traditional meanings is developing towards the “ecological circle” of constructing the intelligent
society. The Company's industrial production and processing businesses are labor-intensive, technology-intensive,
and semi-automatic production mode, orders mainly rely on a large number of domestic renowned large-scale
home appliance manufacturers, the scale is large, and the business is stable. As a traditional industry with intense
21
深圳中恒华发股份有限公司 2016 年年度报告全文
market competition, the core of solving the developing dilemma is to upgrade technology, enhance the added
value of technology, and improve the profitability. Under the background of downstream consumer demand
upgrade, it will be one of the strategic targets of the company’s industrial business development to further
consolidate the industry position by adjusting and improving the product structure, increasing the development
efforts to the new products, improving the production processes, enhancing the productivity, expanding the
downstream channels, cultivating its own brands, and actively seeking for the transformation and upgrading.
Over the years, the Company has focused on both manufacturing and property management, except for producing
and selling the LCD monitors, injection molding, and foam parts, the property leasing has always been the key
pillar of business, the own property is the company's core assets, the operating profits of property leasing business
has always been greater than the industrial business profits. It is the company’s long-term strategic goal to make
full use of the existing property and land assets to continue to expand and upgrade the operation, leasing and
service businesses of the commercial real estate, and further become the long-term and stable source of incomes
for the company step by step.
(II) The new annual business plan
◆ Continue to steadily develop industrial business
On the basis of ensuring the stable orders from existing customers Haier, Gree, AOC, TCL and other home
appliance manufacturers, vigorously expand the market, and strive for more market shares; at the same time,
simplify and optimize the personnel, strengthen the management, and further improve the production efficiency,
promote the product quality, make full use of the company's geographical advantages, and further make the
business bigger and stronger.
◆ Actively strengthen the property business
Seize the popularity of Shenzhen Huaqiang North Street and gradually recover and drive the brisk market,
combine with the actual situation of tenants to adjust the investment attraction measures and enhance the property
occupancy rate; at the same time, strictly control costs and reduce losses.
◆ Continue to promote the urban renewal project
Speed up the promotion of renewal unit project of Huafa District Gongming Street Guangming New District
Shenzhen and the renewal project reconstruction progress of Huafa Building Huaqiang North Street Futian
District Shenzhen, accelerate the project procedures, coordinate with the owners to relocate, complete the
compensation and resettlement of relocation, and strive to make progress early.
◆ Continue to focus on strengthening the company's internal control
In 2017, the company will further optimize the corporate governance structure and improve the internal control
system and process in accordance with the governance requirements of the listed company, strictly implement and
improve the executive ability of relevant system, the company’s management and relevant departments will
execute the administrative provisions for approval procedures of fund utilizing, management system of related
transactions, working system of working system, internal reporting system of major information in strict
accordance with the requirements of internal control documents.
22
深圳中恒华发股份有限公司 2016 年年度报告全文
X. Reception of research, communication and interview
1. In the report period, reception of research, communication and interview
√Applicable □ Not applicable
Time Way Type Basic situation index of investigation
1 Jan. 2016 to 31 Dec. Telephone communication Individual N/A
Reception (times) Several
Number of hospitality 0
Number of individual reception -
Number of other reception 0
Disclosed, released or let out major undisclosed
N
information
23
深圳中恒华发股份有限公司 2016 年年度报告全文
Section V. Important Events
I. Profit distribution plan of common stock and capitalizing of common reserves plan
Formulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially Cash Dividend policy during
the Reporting Period
□ Applicable √ Not applicable
Profit distribution plan (pre-plan) of common stock and capitalizing of common reserves plan (pre-plan) in latest three years
(including the reporting period)
In recent three years the Company accumulated retained net profit is negative and it did not have the conditions for profit distribution,
so the Company did not undertake profit allocation in recent years and no capital reserve shall be converted into share capital either.
Cash dividend of common stock in latest three years (including the reporting period)
In RMB
Net profit attributable to Ratio in net profit
Amount for cash common stock attributable to common
Year for Amount for cash Proportion for cash
bonus (tax shareholders of listed stock shareholders of listed
bonus shares bonus by other ways bonus by other ways
included) company in consolidation company contained in
statement for bonus year consolidation statement
2016 0.00 5,457,710.33 0.00% 0.00 0.00%
2015 0.00 -4,200,845.61 0.00% 0.00 0.00%
2014 0.00 7,687,620.27 0.00% 0.00 0.00%
The Company gains profits in reporting period and the retained profit of common stock shareholders provided by parent company is
positive but no plan of cash dividend proposed of common stock
□ Applicable √ Not applicable
II. Profit distribution plan and capitalizing of common reserves plan for the Period
□ Applicable √ Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from capital reserve either for
the year.
III. Implementation of commitment
1. Commitments that the company, shareholders, actual controller, offeror, directors, supervisors, senior
management or other related parties have fulfilled during the reporting period and have not yet fulfilled by
the end of reporting period
√Applicable □ Not applicable
Type of
Commitment Commitment Implementatio
Commitments Promise commitme Content of commitments
date term n
nts
24
深圳中恒华发股份有限公司 2016 年年度报告全文
Commitments for
share reform
The enterprise and its subsidiaries will
not participate directly or indirectly in
operation of the business with
Implement
competitive of Shen Huafa and its
Wuhan since 12 April
controlling subsidiary concerned, and In normal
Zhongheng 2007-03-29 2007
not to damage the interest of the Shen implementing
Group throughout the
Huafa and its controlling subsidiary by
year
making use of the potential
controlling-ship of the Shen Huafa
either
The enterprise and its subordinate
enterprise shall avoid a related
transaction as far as possible with Shen
Huafa and its controlling subsidiary, as
for the related dealings occurred
Commitments in inevitable or have reasonable cause, the
report of enterprise promise to follow the
Implement
acquisition or principle of fair-ness, justice and
Wuhan since 12 April
equity change open-ness, signed the agreement in line In normal
Zhongheng 2007-03-29 2007
with the laws, perform legal program, implementing
Group throughout the
fulfill information disclosure obligation
year
and relevant approval procedures
according to the relevant laws,
regulations and “Listing Rules” of the
Shenzhen Stock Exchange, guarantee
not to damage the legal interest of Shen
Huafa and its shareholders through
related transactions
After acquisition and assets
Implement
restructuring, guarantee to have an
Wuhan since 12 April
independent staff, owns independent In normal
Zhongheng 2007-03-29 2007
and completed assets, and independent implementing
Group throughout the
in aspect of business, financial and
year
institution from Shen Huafa
Commitments in
assets
reorganization
Commitments
make in initial
public offering or
25
深圳中恒华发股份有限公司 2016 年年度报告全文
re-financing
Equity incentive
commitment
1. If Shenzhen Vanke wins in the
arbitration, the losses from arbitration
for contract dispute will take by Wuhan Implemented
Other Wuhan
commitments for Zhongheng Group in full; 2. the since 20 In normal
Zhongheng 2016-12-20
medium and small intangible losses and risks arising from December implementing
shareholders Group
the termination of relevant contracts, 2016
will take by Wuhan Zhongheng Group
in advance.
Completed on
Y
time(Y/N)
If the
commitments is
not fulfilled on
time, shall explain Not applicable
the specify reason
and the next work
plan
2. Concerning assts or project of the Company, which has profit forecast, and reporting period still in
forecasting period, explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
IV. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable √ Not applicable
VI. Particulars about the changes in aspect of accounting policy, estimates and calculation
method compared with the financial report of last year
√Applicable □ Not applicable
1. Explaination on accounting policy changes
According to the Provisions Concerning the Accounting Treatmetns on VAT Cai Kuai [2016] No.22 issued by Ministry of Finance
on 3 December 2016, relevant business occurred since 1 May 2016 will act by new rules, main influence of the Company for
implementation are as:
Content and reasons for changes Itesm and amount affected
26
深圳中恒华发股份有限公司 2016 年年度报告全文
The “business tax and surcharge” listed in consolidate business tax and surcharge
profit statement and parent company’s profit statement will administrative expenses
adjsute as “taxes and surcharge”
The follow taxes (house duty, land use tax, stamp tax, Tax and surcharge in consolidate profit statement increased
vehicle and vessel tax and resource tax etc.) arising from 2,664,333.31 Yuan for the Year;
operation activities will listed under “taxes and surcharge” Administrative expenses in consolidate profit statement
from”administrative expenses” since 1 May 2016. the taxes decreased 2,664,333.31 Yuan for the Year;
occurred befor 1 May 2016 will not adjuste and Tax and surcharge in parent company’s profit statement
comparative data either increased 1,293,535.18 Yuan for the Year;
Administrative expenses in parent company’s profit statement
decreased 1,293,535.18 Yuan for the Year;
VII. Major accounting errors within reporting period that needs retrospective restatement
√Applicable □ Not applicable
1. Preliminary accounting errors
(1) Retrospective restataement
Contenet Items of comparison period affected Cumulative effects
The rental for year of 2015 was mis-listed as cash Administrative expenses 99,643.33
deposit as collateral, and adjsuted to administrative Other account receivable -99,643.33
expenses as rental charge
The company collected the financing income of T2 Business tax and surcharge -3,473,866.67
class trust units in trust plan of 2015 CITIC Taxes payable – business tax
-3,101,666.67
QianjingGreen Xingcheng investment funds and Taxes payable – urban maintenance &
-217,116.67
accrued the business tax and additional tax which construction tax
were identified not belonging to the business tax
Taxes payable – extra charges of -93,050.00
scope and were corrected and returned back
education funds
Taxes payable – local education surcharge -62,033.33
The correction above mentioned have impact on Income tax expenses 843,555.84
income tax and retained profit of the Company Taxes payable- enterprise income tax 843,555.84
Retained profit 2,530,667.50
VIII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
√Applicable □ Not applicable
Compared with last year, the Company sold Yutian Henghua Company in the period.
27
深圳中恒华发股份有限公司 2016 年年度报告全文
IX. Appointment and non-reappointment (dismissal) of CPA
Accounting firm appointed
Name of domestic accounting firm DAXIN Certified Public Accountants LLP
Remuneration for domestic accounting firm (in 10
48
thousand Yuan)
Continuous life of auditing service for domestic
One year
accounting firm
Name of domestic CPA Li Wei, Fan Zhang
Name of foreign accounting firm (if applicable) N/A
Remuneration for foreign accounting firm (in 10
0
thousand Yuan) (if applicable)
Continuous life of auditing service for foreign
N/A
accounting firm (if applicable)
Name of foreign CPA N/A
Re-appointed accounting firms in this period
√Yes □No
Whether change the CPA in auditing period or not
√Yes □No
Performing approval procedures while change the CPA
√Yes □ No
Explanation on re-engagement and changes of the CPA
ShineWing (special general partnership), the audit institution previously engaged by the company, has provided annual auditing
services for the company for many years, in order to ensure the independence and objectivity of the audit work, the audit committee
of the company’s Board of Directors has carefully considered and submitted to the Board of Directors for consideration, thought that
Daxin Certified Public Accountants (special accounting, special authentication and other services, general partnership with rich
experience in serving the listed company) possesses with
the professional qualification for the implementation of securities, futures-related businesses, has rich experience and professional
quality in the audit work of listed companies, and has successively provided verification for many listed companies, and is capable
of satisfying the company’s requirements to 2016 annual financial audit. The 3rd extraordinary general meeting in 2016 deliberated
and agreed to change ShineWing to Daxin Certified Public Accountants. See details about the change of accounting firm on the
company’s “Notice on Engaging Audit Institution for the Company in 2016 ” (Notice No.2016-52) disclosed on October 10, 2016.
Appointment of internal control auditing accounting firm, financial consultant or sponsor
√Applicable □ Not applicable
In 2016, the Company employed Shine Wing Certified Public Accountants LLC as internal control audit institutions and the expense
of internal control audit was 140,000 Yuan.
28
深圳中恒华发股份有限公司 2016 年年度报告全文
X. Particular about suspended and delisting after annual report disclosed
□ Applicable √ Not applicable
XI. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period
XII. Significant lawsuits and arbitrations of the Company
√Applicable □Not applicable
Amount of
Execution
money Advances
Predicted The results and effects of the
The basic situation of involved in litigation Disclosure
liabilities of litigation litigation Disclosure index
litigation (Arbitration) (in 10 (Arbitration date
(Y/N) (Arbitration) (Arbitratio
thousand )
n)
Yuan)
In September 2016, Wuhan
Zhongheng Group Co., Ltd.
and the Company and
Shenzhen Vanke were Open a http://www.cninfo.co
applied for arbitration due to court m.cn/cninfo-new/discl
the dispute case of session on Not 2016-09-1 osure/szse_main/bulle
46,460 N Without judgment
“Contract for the 12 applicable 4 tin_detail/true/120270
Cooperative Operation of November 2423?announceTime=
the Old Projects at Huafa 2016 2016-09-14 07:41
Industrial Park, Gongming
Street, Guangming New
District”.
In
Court decision as
November
Jifang Company has
2016, the
In March 2016, Hwafa to paid 27.9023 http://www.cninfo.co
Company
Property suit against the million Yuan m.cn/cninfo-new/discl
win in the
Shenzhen Jifang Investment (including rental, Implement 2016-11-0 osure/szse_main/bulle
1,416.67 N ruling
Co., Ltd. for site occupation, administrative fee, ing 8 tin_detail/true/120281
judged by
without rental, and utilities compensation, 7664?announceTime=
Shenzhen
paid for a long-time penalty, lawyer’s fee 2016-11-08
Arbitration
and arbitration fees) in
Commissio
total for the Company
n
In March 2016, the Open a Not 2016-09-1 http://www.cninfo.co
1,964.92 N Without judgment
Company and Hwafa court applicable 4 m.cn/cninfo-new/discl
29
深圳中恒华发股份有限公司 2016 年年度报告全文
Science & Technology suit session on osure/szse_main/bulle
against the follow 14 February tin_detail/true/120270
companies, including 2017 2423?announceTime=
Shenzhen Huayongxing 2016-09-14 07:41
Environmental Technology
Co., Ltd., Shenzhen
Guangyong Breadboard Co.,
Ltd., Shenzhen Mingyi
Electronic Co., Ltd.,
Shenzhen Ouruilai
Technology Co., Ltd and
Shenzhen Kangzhengxin
Technology Co., Ltd., for
arrears of rent. and refuse to
move the site, forcibly
occupied switch board room
and other power unit under
the name of the Company
People’s
The Company and Hwafa
Court of
Property suit against
Futian http://www.cninfo.co
Shenzhen Jifang investment
District, m.cn/cninfo-new/discl
Co., Ltd. and Shenzhen
Shenzhen Not 2016-09-1 osure/szse_main/bulle
Jianianhua Foreign Trade 73.38 N Without judgment
Municipal applicable 4 tin_detail/true/120270
Clothing City Co., Ltd. for
has accept 2423?announceTime=
refusing to paid the rents
and hear the 2016-09-14 07:41
and administrative fee
case on 8
without justified reasons
March 2016
In March 2016, the
Company and Hwafa
http://www.cninfo.co
Property suit against Open a
m.cn/cninfo-new/discl
Shenzhen Huayongxing court
Not 2016-09-1 osure/szse_main/bulle
Environmental Technology 947.26 N session on Without judgment
applicable 4 tin_detail/true/120270
Co., Ltd., and Shenzhen 20 March
2423?announceTime=
Yidaxin Technology Co., 2017
2016-09-14 07:41
Ltd. for contract violation
and refuse to move the site
In December 2015, the The Court decision as Dai
Company and Hwafa Company Qiangbo has to paid
Property suit against Dai win in the the rental and utilities Implement
68 N
Qiangbo for arrears of rent ruling of 327300 Yuan to ing
and occupied the leased judged by Hwafa Property; paid
premises, and refuse to People’s the late rental, and
30
深圳中恒华发股份有限公司 2016 年年度报告全文
move out; Dai Zhijun, Xie Court of surcharge for overdue
Lihua and Dai Tianyi bear Futian utilities payment,
joint liability for debts of District, which is counted since
Dai Qiangbo Shenzhen 6 November 2015,
Municipal based on 327300
on 13 Yuan, to the payment
Feb.2017 actual paid in full by
50 Yuan per 10000
Yuan as charge
everyday; paid
867800 Yuan for
occupation charge;
and court acceptance
fee 12600 Yuan.
XIII. Penalty and rectification
√Applicable □Not applicable
Type of
Conclusion (if Date of
Name Type Reason investigation and Index of disclosure
applicable) disclosure
punishment
i. Failing to disclose related
Initiate an The Company
transactions with the subsidiary
investigation or was ordered to http://www.cninfo.com.cn/c
Shenzhen of controlling shareholder in
administrative make amends ninfo-new/disclosure/szse_
Zhonghen The accordance with regulations; ii.
penalty by CSRC; with a warning 2016-12-24 main/bulletin_detail/true/12
g Hwafa Company Failing to disclose significant
condemned by and imposed fine 02956559?announceTime=2
Co., Ltd. financial transactions; iii.
Stock Exchange penalty of 016-12-24
Failing to disclosed the related
publicly 400,000 Yuan.
transactions out of amount limit
i. Failing to disclose related
Initiate an
transactions with the subsidiary
investigation or http://www.cninfo.com.cn/c
of controlling shareholder in
administrative A warning with ninfo-new/disclosure/szse_
Li Actual accordance with regulations; ii.
penalty by CSRC; fine penalty of 2016-12-24 main/bulletin_detail/true/12
Zhongqiu controller Failing to disclose significant
condemned by 250,000 Yuan 02956559?announceTime=2
financial transactions; iii.
Stock Exchange 016-12-24
Failing to disclosed the related
publicly
transactions out of amount limit
i. Failing to disclose related
http://www.cninfo.com.cn/c
transactions with the subsidiary Initiate an
A warning with ninfo-new/disclosure/szse_
Chen Senior of controlling shareholder in investigation or
fine penalty of 2016-12-24 main/bulletin_detail/true/12
Zhigang executive accordance with regulations; ii. administrative
80,000 Yuan 02956559?announceTime=2
Failing to disclose significant penalty by CSRC
016-12-24
financial transactions; iii.
31
深圳中恒华发股份有限公司 2016 年年度报告全文
Failing to disclosed the related
transactions out of amount limit
i. Failing to disclose related
transactions with the subsidiary
http://www.cninfo.com.cn/c
of controlling shareholder in Initiate an
A warning with ninfo-new/disclosure/szse_
Tang Senior accordance with regulations; ii. investigation or
fine penalty of 2016-12-24 main/bulletin_detail/true/12
Ganyu executive Failing to disclose significant administrative
50,000 Yuan 02956559?announceTime=2
financial transactions; iii. penalty by CSRC
016-12-24
Failing to disclosed the related
transactions out of amount limit
i. Failing to disclose related
transactions with the subsidiary
http://www.cninfo.com.cn/c
of controlling shareholder in Initiate an
A warning with ninfo-new/disclosure/szse_
Weng Senior accordance with regulations; ii. investigation or
fine penalty of 2016-12-24 main/bulletin_detail/true/12
Xiaojue executive Failing to disclose significant administrative
30,000 Yuan 02956559?announceTime=2
financial transactions; iii. penalty by CSRC
016-12-24
Failing to disclosed the related
transactions out of amount limit
i. Failing to disclose related
transactions with the subsidiary
http://www.cninfo.com.cn/c
of controlling shareholder in Initiate an
A warning with ninfo-new/disclosure/szse_
Senior accordance with regulations; ii. investigation or
Cao Li fine penalty of 2016-12-24 main/bulletin_detail/true/12
executive Failing to disclose significant administrative
30,000 Yuan 02956559?announceTime=2
financial transactions; iii. penalty by CSRC
016-12-24
Failing to disclosed the related
transactions out of amount limit
XIV. Integrity of the company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
XV. Implementation of the company’s stock incentive plan, employee stock ownership plan or
other employee incentives
□ Applicable √ Not applicable
The Company had no stock incentive plan, employee stock ownership plan or other employee incentive in the reporting period.
XVI. Major related transaction
1. Related transaction with routine operation concerned
√Applicable □Not applicable
Type of Content Trading Whethe Clearin Availabl Date of Index
Pricing Related Related Proporti
Related Relatio related of principl transacti transacti on in limit r over g form e disclosu of
party nship transacti related on similar for
e on price
on transacti amount transacti approve the related similar re disclos
32
深圳中恒华发股份有限公司 2016 年年度报告全文
on (in 10 ons d (in 10 approve transacti market ure
thousan on
d Yuan) thousan d price
d Yuan) limited
or not
(Y/N)
http://w
ww.cni
nfo.co
m.cn/cn
info-ne
Sharing w/discl
the osure/s
Synchro
same Purchasi Telegra zse_ma
HK nized 2016-04
controll Purchase ng LCD 16,056 16,056 53.31% 34,685 No phic —— in/bulle
Yutian with the -30
ing monitors transfer tin_deta
market
shareho il/true/1
lder 202284
604?an
nounce
Time=2
016-04-
30
The
average
market
price
Confirm
refers to
ed with
the
1% of
price of
current
same
Sharing market
specific
the average
Hengshen ations
same Purchasi price in Telegra Same
g which is 2016-04
controll Purchase ng LCD principl 4,096 4,096 13.60% 10,406 No phic as
Photoelec searche -30
ing monitors e, and transfer above
tricity d from
shareho refer to
through
lder both
the
their
world
bargaini
famous
ng
professi
power
onal
market
survey
compan
33
深圳中恒华发股份有限公司 2016 年年度报告全文
y
website
http://w
ww.wits
view.co
m
recogni
zed
authorit
y in the
industry
and
LCD
professi
onal
market
survey
compan
y
website
http://w
ww.wits
view.co
m
Accordi
ng to
Sharing the
the order
Hengshen
same Purchasi price, Telegra Same
g 2016-04
controll Purchase ng LCD deducte 711 711 2.36% 7,631 No phic —— as
Photoelec -30
ing monitors d 1 transfer above
tricity
shareho Yuan
lder each for
operatio
n charge
Accordi
Sharing
Sales ng to
the
LCD the
same Telegra Same
HK overall custome 2016-04
controll Sales 19,382 19,382 61.93% 52,028 No phic —— as
Yutian monitor r sales -30
ing transfer above
machine order
shareho
set price
lder
sure
34
深圳中恒华发股份有限公司 2016 年年度报告全文
Total -- -- 40,245 -- 104,750 -- -- -- -- --
Detail of sales return with major
N/A
amount involved
In the reporting, Hengfa Technology purchased LCD from HK Yutian with $ 24.29 million
Report the actual implementation of approximately, 48.59% of the annual amount predicted at the beginning of the year;
the daily related transactions which purchased LCD from Hengsheng Photoelectricity with $ 5.9 million approximately, 39.36%
were projected about their total of the annual amount predicted at the beginning of the year; purchasing LCD from
amount by types during the reporting Hengsheng Photoelectricity with about $1.03 million, 9.33% of the annual amount
period(if applicable) predicted at the beginning of the year; sold LCD whole machine to HK Yutian with $ 29.35
million approximately, 39.13% of the annual amount predicted at the beginning of the year.
Reasons for major differences
between trading price and market N/A
reference price
2. Related transactions by assets acquisition and sold
□Applicable √Not applicable
No above mentioned transactions occurred
3. Main related transactions of mutual investment outside
□ Applicable √ Not applicable
No main related transactions of mutual investment outside for the Company in reporting period.
4. Contact of related credit and debt
√Applicable □Not applicable
Whether has non-operating contact of related credit and debt or not
□ Yes √ No
The Company has no non-operating contact of related credit and debt in the Period.
5. Other related transactions
□ Applicable √ Not applicable
The company had no other significant related transactions in reporting period.
XVII. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
No trusteeship for the Company in reporting period
(2) Contract
□ Applicable √ Not applicable
No contract for the Company in reporting period
35
深圳中恒华发股份有限公司 2016 年年度报告全文
(3) Leasing
□ Applicable √ Not applicable
No leasing for the Company in reporting period
2. Major guarantees
√Applicable □ Not applicable
(1) Guarantees
In 10 thousand Yuan
Particulars about the external guarantee of the Company (Barring the guarantee for subsidiaries)
Related Guarante
Actual date of
Announce Actual e for
Name of the Company Guarantee happening (Date Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit of signing type term ted (Y/N)
disclosure limit party
agreement)
date (Y/N)
N/A
Guarantee of the Company and the subsidiaries
Related Guarante
Actual date of
Announce Actual e for
Name of the Company Guarantee happening (Date Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit of signing type term ted (Y/N)
disclosure limit party
agreement)
date (Y/N)
Wuhan Hengfa Joint liability
2016-04-30 30,000 5,471.05 1 year No No
Technology Co., Ltd. guarantee
Total amount of actual
Total amount of approving
occurred guarantee for
guarantee for subsidiaries in report 30,000 9,645.8
subsidiaries in report period
period (B1)
(B2)
Total balance of actual
Total amount of approved
guarantee for subsidiaries at
guarantee for subsidiaries at the 30,000 5,471.05
the end of reporting period
end of reporting period (B3)
(B4)
Guarantee of the subsidiaries for the subsidiaries
Related
Actual date of Complete Guarante
Announce Actual
Name of the Company Guarantee happening (Date Guarantee Guarantee implemen e for
ment guarantee
guaranteed limit of signing type term tation or related
disclosure limit
agreement) not party
date
Total amount of guarantee of the Company( total of three abovementioned guarantee)
Total amount of approving Total amount of actual
guarantee in report period 30,000 occurred guarantee in report 9,645.8
(A1+B1+C1) period (A2+B2+C3)
Total amount of approved 30,000 Total balance of actual 5,471.05
36
深圳中恒华发股份有限公司 2016 年年度报告全文
guarantee at the end of report guarantee at the end of
period (A3+B3+C2) report period (A4+B4+C4)
The proportion of the total amount of actually guarantee in the net
17.11%
assets of the Company(that is A4+ B4+C4)
Including:
Amount of guarantee for shareholders, actual controller and its
0
related parties(D)
The debts guarantee amount provided for the guaranteed parties
0
whose assets-liability ratio exceed 70% directly or indirectly(E)
Proportion of total amount of guarantee in net assets of the
0
Company exceed 50%(F)
Total amount of the aforesaid three guarantees(D+E+F) 0
Explanations on possibly bearing joint and several liquidating
N/A
responsibilities for undue guarantees (if applicable)
Explanations on external guarantee against regulated procedures
N/A
(if applicable)
Explanation on compound guarantee
(2) Guarantee outside against the regulation
□Applicable √Not applicable
No guarantee outside against the regulation in Period.
3. Entrust others to cash asset management
(1) Trust financing
□Applicable √Not applicable
No entrust others to cash asset management
(2) Entrusted loans
□ Applicable √ Not applicable
The company had no entrusted loans in the reporting period.
4. Other material contracts
□ Applicable √ Not applicable
No other material contracts for the Company in reporting period.
XVIII. Social responsibility
1. Execution of social responsibility of targeted poverty alleviation
The Company has no targeted poverty alleviation in the period and no follow-up poverty alleviation plan either
temporary
37
深圳中恒华发股份有限公司 2016 年年度报告全文
(2) Targeted poverty alleviation for the Year
Not applicable
(3) Follow-up targeted poverty alleviation scheme
Nil
2. Execution of other social responsibility
In reporting period, the Company conscientiously in line with the state laws, regulation and requriment of relvant
policies, and aways operate according to law and active participation in taxpaying, provided an exvellant service
and actively perform its social responsibility
The listed Company and subsidiaries is in the range of heavy pollution industry that regulated by State
environment protection departments
Not applicable
Whether the social responsibility report released
□Yes √No
XIX Explanation on other significant events
√Applicable □Not applicable
(I) The Company signed Asset Exchange Contract with Wuhan Zhongheng Group on 29 April 2009 (details were
referred to in the announcement dated 30 April 2009), and pursuant to the contract, since part of the assets of the
Company (namely two parcel of industrial lands located at Huafa road, Gongming town, Guangming new district,
Shenzhen (the property certificate No. were SFDZ No.7226760 and SFDZ No.7226763, No. of parcels were
A627-005 andA627-007, and the aggregate area was 48,200 sq.m) were the lands listed in the first batch of plan
for 2010 Shenzhen urbanization unit planning preparation plan. For promotion of such urbanization project and
joint cooperation, the Company has not completed the transfer procedures in respect of the aforesaid land.
The Company convoked the first extraordinary meeting of the Board in 2015 on February 16, 2015 and the first
extraordinary general meeting of the Board in 2015 on March 4, 2015, which considered and approved the
“Motion on promoting and implementing the urban renewal project for the renewal units of Huafa area at
Gongming street, Guangming new district, Shenzhen”, specified that the Company and Wuhan Zhongheng Group
shall obtain the corresponding compensatory consideration for removal from the respectively owned project plots
and the respectively contributed and constructed above-ground buildings before the land development, it is
estimated that the compensatory consideration obtained by the Company accounts for 50.5% of the total
38
深圳中恒华发股份有限公司 2016 年年度报告全文
consideration and Wuhan Zhongheng Group accounts for 49.5% by calculation.
The fifth extraordinary meeting of the board of directors in 2015 and the third extraordinary general meeting held
on July 2, 2015 have considered and adopted the “Proposal on the project promotion and implementation of urban
renewal and the progress of related transactions of ‘the updated units at Huafa Area, Gong Ming Street,
Guangming New District, Shenzhen’” and “Proposal on submitting stockholders' meeting to authorize the board
of directors to fully handle the matters related to the project promotion and implementation of urban renewal of
Huafa Area, Gong Ming Street, Guangming New District, Shenzhen”. The company has signed the “Agreement
on the cooperation framework of urban renewal project of the updated units at Huafa Area, Gong Ming Street,
Guangming New District, Shenzhen”, “Agreement on the cooperation framework of reconstruction project at
Huafa, Gongming”, “Agreement on the removal compensation for urban renewal project at Huafa, Gong Ming
Street, Guangming New District” and “Cooperation agreement on urban renewal project at Huafa, Gongming”
with Shenzhen Qianhai Zhongzheng Urban Development Management Co., Ltd. (hereinafter referred to as
“Qianhai Zhongzheng”), Shenzhen Zhongzheng Yutian Land Co., Ltd. (hereinafter referred to as “Zhongzheng
Yutian”) and Wuhan Zhongheng Group. The company’s seventh meeting of the eighth board of directors has
considered and adopted the “Proposal on terminating the contract on urban renewal project at ‘Huafa Area, Gong
Ming Street, Guangming New District, Shenzhen’ of Shenzhen Qianhai Zhongzheng Urban Development
Management Co., Ltd.”, the company has signed “Agreement on terminating the contract on urban renewal
project at Huafa, Gongming” with Qianhai Zhongzheng, Zhongzheng Yutian and Wuhan Zhongheng Group, the
relevant agreements signed at earlier stage are no longer legally binding to any party.
The sixth extraordinary meeting of the board of directors in 2015 and the third extraordinary general meeting
held on September 11, 2015 have considered and adopted the “Proposal on the project promotion and
implementation of urban renewal and the progress of related transactions of ‘the updated units at Huafa Area,
Gong Ming Street, Guangming New District, Shenzhen’”, the company has signed the “Agreement on the
cooperation of urban renewal project of the updated units at Huafa Area, Gong Ming Street, Guangming New
District, Shenzhen”, “Contract for the cooperative venture of reconstruction project for Huafa Industrial Park,
Gong Ming Street, Guangming New District” and “Agreement on housing acquisition and removal compensation
and resettlement” with Wuhan Zhongheng New Technology Industry Group Co., Ltd. (hereinafter referred to as
“Wuhan Zhongheng Group”), Shenzhen Vanke Real Estate Co., Ltd. (hereinafter referred to as “Shenzhen
Vanke”), and Shenzhen Vanke Guangming Real Estate Development Co., Ltd. (hereinafter referred to as “Vanke
Guangming”).
On 12 September 2016, the Company received a “Notice of Arbitration No.: SHEN DP20160334” from SCIA,
Wuhan Zhongheng Group and the Company as well as Shenzhen Vanke are applied for arbitration in respect of
“Agreement on the cooperation of urban renewal project of the updated units at Huafa Area, Gong Ming Street,
Guangming New District, Shenzhen”. The arbitra court hold hearings on 12 November 2016. Progress of the case
found more in “Notice of Lawsuit and Arbitration” and “Progress of Lawsuit and Arbitration ” released on juchao
website (www.cninfo.com.cn) dated 14 September 2016, 1 November 2016, 16 November 2016 and 24 March
2017 respectively.
39
深圳中恒华发股份有限公司 2016 年年度报告全文
(II) With purpose of further optimize the capital structure; improve financial status of the Company and providing
necessary capital condition and liquidity for the upgrade of industry business transformation, specialization of the
property operation and development of large-scale, the Company plans to private offering A-share. Controlling
shareholder - Wuhan Zhongheng New Technology Industry Group Co., Ltd. subscribe 87.6 million shares at most
in cash, fund raised no more than 599.184 million Yuan (issuance cost included) in total, the fund are raised for
debt payment and supplement current capital in order to laying a solid foundation of the sustainable development
of the Company. Relevant private placement of A-share has been deliberated and approved by third extraordinary
meeting of 2015 of the Board and Annual General Meeting 2014, found more in notice published on Juchao
Website (www.cninfo.com.cn) dated 20 March and 20 May 2015. It shall submit for approval and implement after
verify by CSRC.
(III) Our controlling shareholder Wuhan Zhongheng Group holds 116,489,894 shares of the Company, accounting
for 41.14% of total share capital. As for involving the arbitration case of “Agreement on the cooperation of urban
renewal project of the updated units at Huafa Area, Gong Ming Street, Guangming New District, Shenzhen”, the
above shares were judicially sealed on 27 September 2016 for creditor’s application for property preserevation.
Details are set out in the announcement published at Juchao information website (www.cninfo.com.cn) on 27
October 2017.
(iv) On 31 December 2015, the 88,750,047 shares held by Wuhan Zhongheng Group, are pledge to China
Merchants Securities Assets Co., Ltd. with due date of 31 December 2016. Wuhan Zhongheng Group deferred the
repurchase business day to 30 June 2017. on 1 Feb. 2016, Wuhan Zhongheng Group pladge the 27,349,953 shares
held to China Merchants Securities Assets Co., Ltd. with due date of 31 December 2016. and also deferring the
repurchase business, same as the pledge release. Found more in notice released on juchao website
(www.cninfo.com.cn) date 17 Jan. 2019.
(v) The company received the notice about registering and investigating from China Securities Regulatory
Commission on January 18, 2016, who decided to register and investigate the company on suspicion of illegal
information disclosure. On September 18, 2016, the company received the “Prior Notice of Administrative
Penalty” ( [2016] No.6) from Shenzhen Regulatory Bureau of China Securities Regulatory Commission. On
December 22, 2016, the company received the “Written Decision of Administrative Penalty” ([2016] No. 7) from
Shenzhen Regulatory Bureau of China Securities Regulatory Commission. See details on the “Notice on
Receiving Written Decision of Administrative Penalty from CSRC” the company published at
www.cninfo.com.cn on December 23, 2016. On January 5, 2017, the company received the “Notice on Giving
Public Censure and Punishment to Shenzhen Zhongheng Hwafa Co., Ltd. and the Relevant Parties” from the
Shenzhen Stock Exchange, see details on the notice published at www.cninfo.com.cn on January 6, 2017.
(vi) The company held the 10th meeting of the 8th Board of Directors, the first extraordinary meeting of the
Board of Directors in 2016 and the second extraordinary general meeting in 2016 respectively on August 29, 2016,
September 7, 2016 and September 19, 2016, which deliberated and approved the Proposal on the General Election
of the Board of Directors, and elected Li Zhongqiu, Li Yongping, Yang Bin, Li Dingan, Xu Jinwen and Zhang
40
深圳中恒华发股份有限公司 2016 年年度报告全文
Zhaoguo as the directors of the 9th Board of Directors. On September 7, 2016, the company held the first meeting
of the 9th Board of Directors to consider the Proposal on Electing the President of the Company, the Proposal on
the Staff Composition of the Special Committees of the 9th Board of Directors, and completed the election of the
Board of Directors and the appointment of senior executives.
On August 29, 2016 and September 19, 2016, the company held the 10th meeting of the 8th Board of Supervisors
and the 2nd extraordinary general meeting in 2016, which deliberated and approved the Proposal on the Election of
the Board of Supervisors, and elected Huang Yanbo and Chen Qin as the supervisors of the 9th Board of
Supervisors. Geng Qu was elected as the supervisor of staff representatives of the 9th Board of Supervisors by the
company’s workers congress. On September 7, 2016, the the 9th Board of Supervisors deliberated and approved
the Proposal on Electing the Chairman of the Board of Supervisors for the first time, and elected Huang Yanbo as
the chairman of the Board of Supervisors.
See details on the notices published at www.cninfo.com.cn by the company on August 31, 2016, September 9,
2016, and September 20, 2016.
(vii) On March 21, 2014, Huafa Property and Shenzhen Jifang Investment Co., Ltd. (hereinafter referred to as
"Jifang Investment") signed the "Shenzhen Housing Leasing Contract" and the "Supplemental Agreement on
Leasing Contract", which were canceled on February 5, 2016. As Jifang Investment occupied the site, and
defaulted rent, management fee and water and electricity bills in the long term, in order to safeguard the legitimate
rights and interests, Huafa Property submitted a request for arbitration to Shenzhen Arbitration Commission on
March 8, 2016, and received the (2016) SZCZ No. 346 ruling paper from Shenzhen Arbitration Commission in
November 2016 which ruled Huafa Property won the lawsuit and currently has entered the enforcement
procedures. See details on the notice published at www.cninfo.com.cn by the company on November 8, 2016.
XX. Significant event of subsidiary of the Company
□ Applicable √ Not applicable
41
深圳中恒华发股份有限公司 2016 年年度报告全文
Section VI. Changes in Shares and Particulars about Shareholders
I. Changes in Share Capital
1. Changes in Share Capital
In Share
Before the Change Increase/Decrease in the Change (+, -) After the Change
Capitaliza
New
Proportio Bonus tion of Subtot Proportio
Amount shares Others Amount
n shares public al n
issued
reserve
I. Restricted shares 0 0.00% 0 0 0 0 0 0 0.00%
283,161,2
II. Unrestricted shares 100.00% 0 0 0 0 0 283,161,227 100.00%
27
181,165,3
1. RMB Ordinary shares 63.98% 0 0 0 0 0 181,165,391 63.98%
91
2. Domestically listed foreign 101,995,8
36.02% 0 0 0 0 0 101,995,836 36.02%
shares 36
283,161,2
III. Total shares 100.00% 0 0 0 0 0 283,161,227 100.00%
27
Reasons for share changed
□Applicable √ Not applicable
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of restricted shares
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□ Applicable √ Not applicable
42
深圳中恒华发股份有限公司 2016 年年度报告全文
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and
liability structure
□ Applicable √ Not applicable
3. Existing internal staff shares
□ Applicable √ Not applicable
III. Particulars about shareholder and actual controller of the Company
1. Amount of shareholders of the Company and particulars about shares holding
In Share
Total preference
shareholders
Total preference
Total common with voting
Total common shareholders with
stock rights recovered
stock voting rights
shareholders at at end of last
shareholders in 27,759 23,293 recovered at end of 0 0
end of last month month before
reporting reporting period (if
before annual annual report
period-end applicable) (found
report disclosed disclosed (if
in note8)
applicable)
(found in note8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Total Number of share pledged/frozen
Amount of
shareholders Changes Amount of
Proportion restricted
Full name of Nature of
of shares at the end in report un-restricted
Shareholders shareholder shares
held State of share Amount
of report period shares held
held
period
Domestic Pledged 116,100,000
Wuhan Zhongheng non-state-o
41.14% 116,489,894 0 0 116,489,894
Group wned legal Frozen 116,489,894
person
SEG (HONG Overseas Pledged 0
5.85% 16,569,560 0 0 16,569,560
KONG) CO., LTD. legal person Frozen 0
GOOD HOPE Pledged 0
CORNER Overseas
4.49% 12,700,000 -1200000 0 12,700,000
INVESTMENTS legal person Frozen 0
LTD
Changjiang Pledged 0
Securities Overseas
1.89% 5,355,249 -2392800 0 5,355,249
Brokerage legal person Frozen 0
(Hongkong) Co.,
43
深圳中恒华发股份有限公司 2016 年年度报告全文
Ltd.
Domestic Pledged 0
Xu Dongdong nature 0.60% 1,690,307 1,690,307
Frozen 0
person
Domestic Pledged 0
Zhong Jiachao nature 0.44% 1,244,440 1,244,440
Frozen 0
person
Domestic Pledged 0
Huang Shuqiang nature 0.41% 1,174,566 1,174,566
Frozen 0
person
Foreign Pledged 0
BINGHUA LIU nature 0.30% 840,113 840,113
Frozen 0
person
Domestic Pledged 0
Zhu Xionghui nature 0.23% 661,780 661,780
Frozen 0
person
Domestic Pledged 0
Huang Qingpeng nature 0.23% 656,500 656,500
Frozen 0
person
Strategy investors or general
corporation comes top 10
N/A
shareholders due to rights issue
(if applicable) (see note 3)
Among the top ten shareholders, Wuhan Zhongheng Group neither bears associated relationship
with other shareholders, nor belongs to the consistent actor that are prescribed in Measures for the
Explanation on associated
Administration of Disclosure of Shareholder Equity Changes of Listed Companies. The Company
relationship among the
neither knew whether there exists associated relationship among the other tradable shareholders,
aforesaid shareholders
nor they belong to consistent actors that are prescribed in Measures for the Administration of
Disclosure of Shareholder Equity Changes of Listed Companies.
Particular about top ten shareholders with un-restrict shares held
Type of shares
Shareholders’ name Amount of un-restrict shares held at Period-end
Type Amount
RMB common
Wuhan Zhongheng Group 116,489,894 116,489,894
share
Domestically
SEG (HONG KONG) CO., LTD. 16,569,560 listed foreign 16,569,560
shares
Domestically
GOOD HOPE CORNER
12,700,000 listed foreign 12,700,000
INVESTMENTS LTD
shares
44
深圳中恒华发股份有限公司 2016 年年度报告全文
Domestically
Changjiang Securities Brokerage
5,355,249 listed foreign 5,355,249
(Hongkong) Co., Ltd.
shares
RMB common
Xu Dongdong 1,690,307 1,690,307
share
RMB common
Zhong Jiachao 1,244,440 1,244,440
share
RMB common
Huang Shuqiang 1,174,566 1,174,566
share
Domestically
BINGHUA LIU 840,113 listed foreign 840,113
shares
Overseas listed
Zhu Xionghui 661,780 661,780
foreign share
RMB common
Huang Qingpeng 656,500 656,500
share
Among the top ten unrestricted shareholders, the Company neither knew whether there
Expiation on associated relationship or exists associated relationship among the other tradable shareholders, nor they belong to
consistent actors within the top 10 consistent actors that are prescribed in Measures for the Administration of Disclosure of
un-restrict shareholders and between Shareholder Equity Changes of Listed Companies. Among the top ten shareholders, Wuhan
top 10 un-restrict shareholders and top Zhongheng Group neither bears associated relationship with other shareholders, nor
10 shareholders belongs to the consistent actor that are prescribed in Measures for the Administration of
Disclosure of Shareholder Equity Changes of Listed Companies.
Explanation on top 10 shareholders
involving margin business (if N/A
applicable) (see note 4)
Whether top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held have a buy-back
agreement dealing in reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held of the Company have no
buy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: natural person holding
Type of controlling shareholders: legal person
Legal
person/person Date of Organizati
Controlling shareholders Main operation business
in charge of foundation on code
the unit
91420114 Production, sales of computers, TV set, display, other hardware and
Wuhan Zhongheng Group Li Zhongqiu 1996-03-21
71195460 computer software; development of internal data communication
45
深圳中恒华发股份有限公司 2016 年年度报告全文
1W network, building of packing materials and light weight building
material for packaging; management of exports business for the
own products and technologies for the Company and member
enterprise; management of export business on raw material,
apparatus and instrument, machinery equipments, spare parts and
technologies (not including goods and technologies that import and
export are national restricted or prohibited ); dry clean and steam
iron service; copy & print; business information consulting; house
tenancy; property management; wholesale and retails of the
hardware metal products, plastic products, audio electronic
products, electronic equipment, textile, toys, clothing & shoes,
luggage, bedding article, general merchandise, curtain, household
appliances and building materials; development of real-estate and
sales of commercial housings (projects with special provision of the
state can be operation after approval)
Equity of other
domestic/oversea listed
company control by
Not applicable
controlling shareholder as
well as stock-joint in
report period
Changes of controlling shareholders in reporting period
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period
3. Actual controller of the Company
Nature of actual controller: domestic natural person
Type of actual controller: natural person
Enjoy the residence rights in the other country or area
Actual controller’s name Nationality
(Y/N)
Li Zhongqiu P.R.C N
He serves as the Chairman for Wuhan Zhongheng Group since 1996 and serves as
Main occupation in position
Chairman and GM of the Company since 2007.
Listed companies in and out of China that
N/A
controlled in last 10 years
Changes of actual controller in reporting period
□ Applicable √ Not applicable
No changes of actual controllers for the Company in reporting period.
Property right and controlling relationship between the actual controller and the Company is as follow:
46
深圳中恒华发股份有限公司 2016 年年度报告全文
Li Zhongqiu
99%
Wuhan Zhongheng New Science & Technology Industrial Group Co., Ltd
41.14%
Shenzhen Zhongheng Huafa Co., Ltd.
Actual controller controlling the Company by entrust or other assets management
□ Applicable √ Not applicable
4. Particulars about other legal person shareholders with over 10% shares held
□ Applicable √ Not applicable
5. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,
restructuring side and other commitment subjects
□ Applicable √ Not applicable
47
深圳中恒华发股份有限公司 2016 年年度报告全文
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period.
48
深圳中恒华发股份有限公司 2016 年年度报告全文
Section VIII. Particulars about Directors, Supervisors, Senior
Executives and Employees
I. Changes of shares held by directors, supervisors and senior executives
Amount Amount
Shares Shares
of shares of shares
held at Other held at
Working Start dated of End date of increased decreased
Title Sex Age period-b changes period-en
Name status office term office term in this in this
egin (share) d
period period
(Share) (Share)
(Share) (Share)
Li Currently 2019-09-1
Chairman M 52 2007-07-18 0 0 0 0 0
Zhongqiu in office 8
Li Vice Currently 2019-09-1
M 59 2013-08-23 0 0 0 0 0
Yongping chairman in office 8
Director,
secretary
Currently 2019-09-1
Yang Bin of the M 44 2015-11-06 0 0 0 0 0
in office 8
Board,
CFO
Independ
Li Currently 2019-09-1
ent M 71 2016-09-19 0 0 0 0 0
Ding’an in office 8
director
Independ
Xu Currently 2019-09-1
ent M 51 2016-09-19 0 0 0 0 0
Jingwen in office 8
director
Independ
Zhang Currently 2019-09-1
ent M 60 2014-05-23 0 0 0 0 0
Zhaoguo in office 8
director
Huang Superviso Currently 2019-09-1
F 54 2012-01-16 0 0 0 0 0
Yanbo r in office 8
Superviso Currently 2019-09-1
Geng Qu F 47 2012-04-09 0 0 0 0 0
r in office 8
Superviso Currently 2019-09-1
Chen Qin F 30 2015-11-06 0 0 0 0 0
r in office 8
Tang Deputy Currently 2019-09-1
F 39 2013-08-23 0 0 0 0 0
Ganyu GM in office 8
Li Independ Leave the 2016-09-1
M 49 2010-08-11 0 0 0 0 0
Xiaodong ent office 9
49
深圳中恒华发股份有限公司 2016 年年度报告全文
director
Independ
Qiu Leave the 2016-09-1
ent M 50 2014-05-23 0 0 0 0 0
Daliang office 9
director
Wang Leave the 2016-02-1
Director M 64 2013-08-23 0 0 0 0 0
Feng office 5
Total -- -- -- -- -- -- 0 0 0 0 0
II. Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Title Type Date Reasons
Leave the office
Independent
Li Xiaodong for expiration of 2016-09-19 Expiration of the term of office
director
the term
Leave the office
Independent
Qiu Daliang for expiration of 2016-09-19 Expiration of the term of office
director
the term
Wang Feng Director Leave the office 2016-02-15 Personal reasons
III. Post-holding
Professional background, major working experience and present main responsibilities in Company of directors, supervisors and
senior executive
Li Zhongqiu: Male, was born in 1962 with Master of Engineering. He is representative to the tenth session of
NPC of Hubei Province, May the first of labor medalist of Wuhan. He serves as Chairman of Wuhan Zhongheng
New Science & Technology Industrial Group Co., Ltd. since 1996. And he serves as Chairman and the General
Manager of the Company since July 2007.
Li Yongping: Male, born in 1957, member of the CPC, a vice researcher. He served as director and vice director in
industry & traffic office of Hubei Statistics Bureau from December 1978 to May 1984; head of comprehensive
group of worker office of Hubei Province from May 1984 to September 1988; vice director of scientific research
institute of Hubei Statistics Bureau from September 1988 to July 1992; took post of standing deputy editor of
Reform Horizontal magazine of Hubei Commission for Economic Restructuring from July 1992 to September
1994; served as research assistant in comprehensive office of Shenzhen Economic Restructuring Office from
September 1994 to September 1999, investigator of Shenzhen Economic Restructuring Office from September
1999 to January 2001; served as secretary of research society of Shenzhen Economic Restructuring Office from
January 2001 to December 2002; and a head of policy group of Shenzhen Enterprise Reform and Development
Office from January 2003 to June 2004; investigator of assessment office of Shenzhen SASAC Statistics from
June 2004 to December 2004; director of Inspection Office of Shenzhen SASAC from December 2004 to June
50
深圳中恒华发股份有限公司 2016 年年度报告全文
2006; he also served as deputy GM of Shenzhen Dachanwan Port Investment & Development Co., Ltd. from July
2006 to December 2010, and he serves as deputy Gm and member of Party Committee of Shenzhen Electronics
Group Co., Ltd. since January 2011 and a deputy chairman of the Company since August 2013.
Yang Bin, male, born in April 1972, master's degree, graduated as a business administration major from Xi'an
Jiaotong University. Worked in Industrial and Commercial Bank of China, Xi'an Branch, High-Tech Development
Zone Branch from July 1994 to March 2001; served as deputy general manager in business department of China
Minsheng Banking Corp., Xi'an Branch from March 2001 to November 2004; served as international market
branch leader in Shenzhen Mindray Medical International Limited from November 2004 to November 2007;
served as director and vice president in Shenzhen TERS Environmental Investment Co., Ltd. from November
2007 to March 2010; served as executive vice president and secretary of the board in Shenzhen CAU Technology
Co., Ltd. from March 2010 to August 2015; served as an independent director in Livzon Pharmaceutical Group
Co., Ltd. from June 2009 to June 30, 2015. Serves as an independent director in Centre Testing International
Group Co., Ltd. from January 2010 to august 2016, and serves as director, secretary of the board and chief
financial officer of the Company since November 2015.
Li Dingan: male, born in 1945, professor, doctoral tutor, the first batch of Chinese certified public accountants. In
1982, he obtained the master degree of economics of Zhongnan University of Finance and Economics and stayed
at the university as a teacher; in June 1996, he was transferred to South China University of Technology, served as
the professor and deputy director of the Department of Applied Mathematics; from 1998 to 2012, he served
successively as the 8th, 9th, and 10th standing committee member of CPPCC Guangdong Provincial Committee; he
serves as the professor at School of Business Administration from May, 2002, and served as executive vice
president of the School of Economics and Trade from July 2005 to January 2009. He has been serving as the
professor at School of Business Administration South China University of Technology since 2009, he is also the
director of Guangdong Provincial Tax Institute, the director of Guangdong Provincial Local Tax Institute, the vice
chairman of the enterprise development research specialist working committee of Guangdong Manufacturers
Association, the director of CPPCC Guangdong Provincial Committee Fellowship Council, the independent
director of Guangdong Kangmei Pharmaceutical Co., Ltd., the independent director of PCI-Suntek Tech Co., Ltd.,
and the independent director of Wuhan Liyuan Information Technology Co., Ltd.. He has been serving as the
independent director of the company since September 2016.
Xu Jinwen: male, born in 1965, the doctor of management science and engineering of Huazhong University of
Science and Technology. He worked at China Construction Bank Wuhan Sub-branch from July 1984 to
September 1985; served as the credit chief at China Construction Bank Hubei Branch from September 1985 to
December 1990; served as the deputy general manager of Hubei Province Trust and Investment Corporation of
China Construction Bank; served as the executive deputy general manager of Guotai Junan Securities Hubei
Branch from October 1995 to August 2000; served as the general manager of Guotai Junan Securities Jiangxi
Headquarters from August 2000 to November 2002; served as the president of Golden Sun SEcurities Co., Ltd.
from November 2002 to April 2006; served as the chairman of Changjiang Bali Baifuqin Securities Co., Ltd. from
April 2006 to May 2007; served as the vice president and secretary of the board of Changjiang Securities Co., Ltd.
51
深圳中恒华发股份有限公司 2016 年年度报告全文
from May 2007 to March 2016; he has been serving as the chairman and CEO of Changjiang Securities Holding
(Hong Kong) Co., Ltd. since September 2016. He has been serving as the independent director of the company
since September 2016.
Zhang Zhaoguo, male, born in 1956, Ph. D. in Management, a professor (secondary) and doctoral supervisor. He
worked as chief of the accounting teaching & research section and senior lecture in Yichang Finance & Trading
School from August 1978 to November 1993, served as professor and deputy head of financial department of
Wuhan University Business College from December 1993 to August 2004; served as a director of Accounting
department of School of Management, Huazhong University of Science & Technology. And the president of
Accounting Institute of China, vice president of Accounting Association of Hubei Province, vice president of
Hubei Central Enterprise Accounting Association, dean of Wuhan Yangtze Business University, and the
independent directors of HRTN, Katie Ecological Environment Polytron Technology Inc, Shenzhen Zhongheng
Hwafa Co., Ltd. and Eastern Jin Yu Co., Ltd.
Tang Ganyu: Female, born in 1977, college degree. Served as assistant of factory director in Wuhan Hengsheng
Optoelectronics Industry Co., Ltd. from August 2003 to July 2005, engineering manager from August 2005 to
July 2006, project manager and production manager from August 2006 to December 2011; served as the
supervisor of the Company from July 2007 to January 2012 and general manager assistant of the Company from
January 2012 to August 2013, and serves as deputy general manager of the Company since August 2013.
Huang Yanbo: female, born in 1962, a university background and a senior accountant. She served as financial
director of Wuhan Zhongda Shopping Mall since 1985 to 1998; and worked as financial manager of Wuhan
Zhongheng New Science & Technology Industrial Group Co., Ltd. from 1998 to 2007 and GM assistant in charge
of auditing supervise from 2007 to 2011; she serves as CFO of the Company from 2012 to 2016; she serves as
deputy GM of Wuhan Zhongheng New Science & Technology Industrial Group Co., Ltd. since October 2016, and
the supervisor of the Company since January 2012 and she is the chairman of supervisory committee of the
Company since August 2013.
Geng Qu: female, born in 1969, is graduated from Beihang University, the first quality engineer, a real estate
economist, a human resources economist and an engineer. She worked for the Company since 1990 and
successively served as director of quality standard, director of comprehensive management department and deputy
chief of office of the Company. She serves as employee supervisory of the Company since April 2012.
Chen Qin: Female, born in 1986, bachelor degree, human resources professional. Worked on administrative work
in Merida Bicycle (China) Co., Ltd. from July 2002 to July 2003, engaged in purchasing work in Hui Pu
Electronics (Shenzhen) Co., Ltd. from August 2003 to September 2004, and served as the administration manager
in Huake United Technology (Shenzhen) Co., Ltd. from September 2004 to 2005 October; works in the Company
since October 2005 and serves as supervisor of the Company since 2015
52
深圳中恒华发股份有限公司 2016 年年度报告全文
Post-holding in shareholder’s unit
√ Applicable □ Not applicable
Received
Position in Start dated of office End date of remuneration from
Name Name of shareholder’s unit
shareholder’s unit n term office term shareholder’s unit
(Y/N)
Li Zhongqiu Wuhan Zhongheng Group Chairman 1996-03-21 N
Shenzhen Electronics Deputy GM, party
Li Yongping 2011-01-03 Y
Group Co., Ltd. committee
Huang Yanbo Wuhan Zhongheng Group Deputy GM 2016-10-12 Y
Statement of
post-holding in
N/A
shareholder’s
unit
Post-holding in other unit
√ Applicable □ Not applicable
Received
Position in Start dated of End date of office remuneration
Name Name of other units
other unit n office term term from other unit
(Y/N)
Li Ding’an South China University of Technology Professor
Guangdong Provincial International Tax
Li Ding’an Director
Institute
Guangdong Provincial Local Taxation
Li Ding’an Director
Institute
Working Committee of Experts on
Li Ding’an Enterprise Development of Guangdong Vice president
Manufacturing Association
Guangdong Provincial Committee of
Li Ding’an Director
CPPCC
Guangdong Kangmei Pharmaceutical Co., Independent
Li Ding’an
Ltd. director
Independent
Li Ding’an Jiadu Xintai Technology Co., Ltd.
director
Wuhan LiYuan Information Technology Independent
Li Ding’an
Co., Ltd. director
Changjiang Securities Holding (Hong Chairman and
Xu Jingwen
Kong) Co., Ltd. CEO
53
深圳中恒华发股份有限公司 2016 年年度报告全文
Chinese Accounting Association Branch of President 会
Zhang Zhaoguo
High Engineering College and University 长
Zhang Zhaoguo Accounting Association of Hubei Province Vice president
Hubei Central Enterprise Accounting
Zhang Zhaoguo Vice president
Association
Zhang Zhaoguo Wuhan Yangtze Busines University Dean
Independent
Zhang Zhaoguo HRTN
director
Katie Ecological Enviornment POlytron Independent
Zhang Zhaoguo
Technology Inc director
Independent
Zhang Zhaoguo Eastern Jin Yu Co., Ltd.
director
Punishment of securities regulatory authority in recent three years to the company’s current and outgoing directors, supervisors and
senior management during the reporting period
√ Applicable □ Not applicable
On December 22, 2016, the company received the “Written Decision of Administrative Penalty” ([2006] No. 7) from CSRC
Shenzhen Securities Regulatory Bureau which gave following penalties to the company and related parties: (a) order Shen Hwafa to
correct errors, give a warning, and impose a fine of 400,000 Yuan; (b) give a warning to Li Zhongqiu and impose a fine of 250,000
yuan; (c) give a warning to Chen Zhigang, and impose a fine of 80,000 yuan; (d) give a warning to Tang Ganyu, and impose a fine of
80,000 yuan; (e) give a warning to Weng Xiaoyu and Cai Li, and impose a fine of 30,000 yuan. See details on the “Notice on
Receiving Written Decision of Administrative Penalty from CSRC” (Notice No.: 2016-68) at http://www.cninfo.com.cn.
IV. Remuneration for directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
Remuneration of directors and supervisors are determined by general meeting, and the allowance standard for
each independent director is RMB 60, 000 per year (tax included).
Remuneration of senior management is determined by the board based on the unified remuneration management
system and actual completion of operational targets, and the “Proposal of Basic Remuneration for High-ranking
Managers of the Company” was deliberated and approved in 2nd extraordinary meeting of the Board for year of
2012.
Remuneration for directors, supervisors and senior executives in reporting period
In 10 thousand Yuan
Total Whether
remuneration remuneration
Post-holding
Name Title Sex Age obtained from the obtained from
status
Company (before related party of
taxes) the Company
Li Zhongqiu Chairman, GM M 52 Currently in 48 N
54
深圳中恒华发股份有限公司 2016 年年度报告全文
office
Currently in
Li Yongping Vice chairman M 59 0 Y
office
Director,
Currently in
Yang Bin Secretary of the M 44 30 Y
office
Board, CFO
Independent Currently in
Li Ding’an M 71 2 N
director office
Independent Currently in
Xu Jingwen M 51 2 N
director office
Independent Currently in
Zhang Zhaoguo M 60 6 N
director office
Currently in
Huang Yanbo Supervisor F 54 0 Y
office
Currently in
Geng Qu Supervisor F 47 9.3 N
office
Currently in
Chen Qin Supervisor F 30 8.8 N
office
Currently in
Tang Ganyu Deputy GM F 39 30.96 N
office
Independent
Li Xiaodong M 49 Leave the office 4 N
director
Independent
Qiu Daliang M 50 Leave the office 4 N
director
Wang Feng Director M 64 Leave the office 0 N
Total -- -- -- -- 145.06 --
Delegated equity incentive for directors, supervisors and senior executives in reporting period
□ Applicable √ Not applicable
V. Particulars of workforce
1. Number of Employees, Professional composition, Education background
Employee in-post of the parent Company (people) 31
Employee in-post of main Subsidiaries (people) 910
The total number of current employees (people) 941
The total number of current employees to receive pay (people) 941
Retired employee’ s expenses borne by the parent Company and
0
main Subsidiaries (people)
55
深圳中恒华发股份有限公司 2016 年年度报告全文
Professional composition
Category of professional composition Numbers of professional composition (people)
Production personnel 783
Sales personnel 23
Technical personnel 27
Financial personnel 14
Administrative personnel 94
Total 941
Education background
Category of education background Numbers (people)
Undergraduate and above 48
Junior college 100
793
Total 941
2. Remuneration Policy
The company’s directors (excluding independent directors), supervisors and senior management personnel are
monthly paid by basic pay and performance pay, and the annual remunerations are paid after annual assessment;
the company’s independent directors are paid 60,000 Yuan per person per year as allowances (including tax), the
travel expenses for attending the board meeting and stockholders' meeting and the necessary expenses generated
by exercising their powers in accordance with relevant laws and regulations can be applied for reimbursement
according to the company’s regulations; the remuneration ordinary employees are decided by the positions,
including probationary period salary regular employee salary, and the company pays social security and public
accumulated funds for them in accordance with the national regulations.
3. Training programs
(1) The directors, supervisors and senior management personnel actively participate in the relevant training and
assessment organized by the regulatory agencies, such as Shenzhen Stock Exchange, Shenzhen Securities
Regulatory Bureau, etc.
(2) The company regularly or irregularly organizes professional trainings for employees according to the
departments and division of labor, including internal trainings and external trainings, thereinto, internal trainings
are provided by specialized personnel in the company; external trainings are provided by organizing employees
to participate in the trade associations and the training organized by supervision department.
(3) Organize staff in all positions to actively participate in the learning and assessment of technical professional
qualifications required by different positions.
56
深圳中恒华发股份有限公司 2016 年年度报告全文
4. Labor outsourcing
□ Applicable √ Not applicable
57
深圳中恒华发股份有限公司 2016 年年度报告全文
Section IX. Corporate Governance
I. Corporate governance of the Company
During the reporting period, in accordance with the laws and regulations of the "Company Law", "Securities Law",
and "Governance Norms of Listed Companies", and the relevant rules and requirements promulgated by the China
Securities Regulatory Commission, the company has constantly improved the corporate governance structure,
established a sound internal control system, enhanced the level of standard operation, strictly followed the
provisions of the production and management control and the financial management and control and the
information disclosure and control, carried out the work on the basis of the "Articles of Association", "Rules of
Procedure of the Board of Directors”, "Rules of Procedure of the Board of Supervisors”, “Working System of the
Independent Directors”, and “Working Rules of the General Manager”, and ensured that the shareholders' meeting,
the board of directors and the board of supervisors can perform their duties and responsibilities normally. The
company's governance meets the requirements on the documents of governance norms of listed companies issued
by China Securities Regulatory Commission.
During the reporting period, in order to safeguard the legitimate rights and interests of the company, the
shareholders and the creditors and regulate the organization and behavior of the company, the company has
revised the “Constitution of Shenzhen Zhongheng Huafa Co., Ltd.” according to the “Company Law of the
People's Republic of China”, “Securities Law of the People's Republic of China” and the “Guidelines for the
Articles of Association of Listed Companies (2014 Revision)” issued by China Securities Regulatory Commission
Is there any difference between the actual condition of corporate governance and relevant regulations about
corporate governance for listed company from CSRC?
□Yes √ No
There are no differences between the actual condition of corporate governance and relevant regulations about
corporate governance for listed company from CSRC.
II. Independency of the Company relative to controlling shareholders’ in aspect of businesses,
personnel, assets, organization and finance
During the reporting period, the company’s controlling shareholder - Wuhan Zhongheng Group has separated the
business, personnel, assets, organization and finance from the controlling shareholders in accordance with the laws
and regulations of the "Company Law" and "Articles of Association", and had the independent and complete
business system and the capabilities of independent management.
1. Personnel: The company fully and independently operates in the labor, personnel and salary management
systems and has established the independent management system, all of the company's senior executives are
working in the Company and receive the salaries, no senior executive has held a post in both the Company and the
controlling shareholder’s company, and no financial staff has held a post in two or more of the related companies.
58
深圳中恒华发股份有限公司 2016 年年度报告全文
2. Assets: The company has the clear property rights with the controlling shareholders and the capabilities of
independent management, possesses the full rights to control the production system, supporting facilities and land
use rights, no major shareholder has occupied or dominated the assets.
3. Finance: The company has established the independent, complete, standardized financial accounting system and
financial management system, and the corresponding internal control system and internal audit system in
accordance with the requirements of the "Accounting Standards for Business Enterprises" to make the independent
financial decisions.
4. Organization: the board of directors, the board of supervisors, and other internal organizations are sound and
operate independently, the organization is completely separated from the controlling shareholders, all
organizations of the company are set up based on the norms and requirements of the listed company and the
company’s actual business features which have the independent office addresses and there is no mixed operation
or co-working, and the controlling shareholders legally exercise the investors’ rights and undertake the
corresponding obligations.
5. Business: the company has the completely independent business operation system, the capabilities of
independent management, the independent purchasing system, production system and marketing system, doesn’t
depend on the controlling shareholders to gain profits or have the horizontal competition relationship with the
controlling shareholders or the subsidiaries.
III. Horizontal competition
□ Applicable √ Not applicable
IV. In the report period, the Company held annual shareholders’ general meeting and
extraordinary shareholders’ general meeting
1. Annual Shareholders’ General Meeting in the report period
Ratio of investor
Session of meeting Type Date Date of disclosure Index of disclosure
participation
2016 First http://www.cninfo.com.cn/cninf
Extraordinary
Extraordinary o-new/disclosure/szse_main/bul
shareholders’ 52.20% 2016-05-17 2016-05-18
shareholders’ general letin_detail/true/1202326404?an
general meeting
meeting nounceTime=2016-05-18
http://www.cninfo.com.cn/cninf
o-new/disclosure/szse_main/bul
2015AGM AGM 51.93% 2016-05-24 2016-05-25
letin_detail/true/1202337376?an
nounceTime=2016-05-25
2016 Second http://www.cninfo.com.cn/cninf
Extraordinary
Extraordinary o-new/disclosure/szse_main/bul
shareholders’ 47.02% 2016-09-19 2016-09-20
shareholders’ general letin_detail/true/1202709260?an
general meeting
meeting nounceTime=2016-09-20
2016 Third Extraordinary 46.99% 2016-10-25 2016-10-26 http://www.cninfo.com.cn/cninf
59
深圳中恒华发股份有限公司 2016 年年度报告全文
Extraordinary shareholders’ o-new/disclosure/szse_main/bul
shareholders’ general general meeting letin_detail/true/1202785317?an
meeting nounceTime=2016-10-26
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
V. Responsibility performance of independent directors
1. The attending of independent directors to Board meetings and general meeting
The attending of independent directors to Board Meeting
Times of Board
Absent the
meeting Times of Times of
Name of independent Times of Times of Meeting for the
supposed to attending by entrusted
director Presence Absence second time in a
attend in the communication presence
row (Y/N)
report period
Qiu Daliang 3 2 1 0 0 N
Li Xiaodong 3 2 1 0 0 N
Zhang Zhaoguo 6 3 3 0 0 N
Xu Jingwen 3 1 2 0 0 N
Li Ding’an 3 1 2 0 0 N
Times for attending general meeting
4
from independent directors
Explanation of absent the Board Meeting for the second time in a row
Nil
2. Objection for relevant events from independent directors
Independent directors come up with objection about Company’s relevant matters
□Yes √No
Independent directors has no objections for relevant events in reporting period
3. Other explanation about responsibility performance of independent directors
The opinions from independent directors have been adopted
√ Yes □ No
Explanation on advice that accepted/not accepted from independent directors
Advices about the Company from independent directors are all accepted in the reporting period.
VI. Duty performance of the special committees under the board during the reporting period
1. Duty performance of the audit committee
During the reporting period, the work carried out by the audit committee mainly included: listening to the
60
深圳中恒华发股份有限公司 2016 年年度报告全文
company's annual operating, financial and internal audit work, continuing to concern and guide the company’s
financial affairs and internal audit supervision, carrying forward the audit work to the company’s annual financial
report, sending a letter to urge the audit report to be submitted on time, communicating with the certified public
accountants time after time during the annual audit, objectively evaluating the annual audit work of the accounting
firm, and making the resolution to agree to re-appoint the accounting firm.
2. Remuneration & appraisal committee
During the reporting period, the remuneration & appraisal committee has audited 2013 annual remuneration of the
company’s directors, supervisors and senior management which was considered to be consistent with the actual
situation and in line with the provisions of relevant laws and the regulations of remuneration and appraisal system.
3. The nominations committee
During the reporting period, the nominations committee has investigated the proposal for the supplement of
independent directors, and made the decision to agree to submit to the board of directors for consideration.
VII. Works from Supervisory Committee
The Company has risks in reporting period that found in supervisory activity from supervisory committee
□ Yes √ No
Supervisory committee has no objection about supervision events in reporting period
VIII. Examination and incentives of senior management
During the reporting period, in order to enable the senior management to better perform their duties and maintain
the interests of the company and its shareholders, the company has floatingly paid the remuneration to urge the
company's management to work more diligently and ensure the realization of the company's development strategy
and operation target accordingly to the “Staff rank and basic salary system” and the performance assessment and
combining with the company's actual operating conditions.
IX. Internal Control
1. Details of major defects in IC appraisal report that found in reporting period
□Yes √ No
2. Appraisal Report of Internal Control
Disclosure date of full internal control
2017-04-25
evaluation report
Disclosure index of full internal control
The designated website: Juchao Website
evaluation report
The ratio of the total assets of units
included in the scope of evaluation
100.00%
accounting for the total assets on the
company's consolidated financial
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深圳中恒华发股份有限公司 2016 年年度报告全文
statements
The ratio of the operating income of units
included in the scope of evaluation
accounting for the operating income on the 100.00%
company's consolidated financial
statements
Defects Evaluation Standards
Category Financial Reports Non-financial Reports
1. General deficiencies: when facing
1. General deficiencies: the amount of direct low-risk matters in the process of
property loss is between 50,000 and 150,000 business operation, the unit being
Yuan, penalized by the district-level inspected didn’t take corresponding
(including district-level) government sector internal control measures and respond
but not having a negative impact on the effectively;
company’s regular disclosure; 2. Important 2. Important deficiencies: when facing
deficiencies: the amount of direct property matters at a moderate risk level in the
loss is between 150,000 and 450,000 Yuan, process of business operation, the unit
Qualitative criteria
penalized by the provincial level (including being inspected didn’t take
provincial level) government sector but not corresponding internal control measures
having a negative impact on the company’s and respond effectively;
regular disclosure; 3. Major deficiencies: the 3. Major deficiencies: when facing
amount of direct property loss is more than high-risk matters in the process of
450,000 Yuan, penalized by the government business operation, the unit being
sector and having a negative impact on the inspected didn’t take corresponding
company’s regular disclosure; internal control measures and respond
effectively.
1. It belongs to important deficiency if the
misstatement of the company’s cash on hand,
bank deposits, notes receivable, and notes
payable caused by internal control
deficiencies is less than RMB 1000 Yuan; it General deficiencies: misstatement index
belongs to major deficiency if the 1 ≥0.5‰, and misstatement index 2 <
misstatement caused by internal control 0.5‰;
Quantitative standard deficiencies is greater than or equal to RMB Important deficiencies: 0.5‰ ≤
1000 Yuan. misstatement index 2 < 1‰;
2. Other deficiencies in internal controls: Major deficiencies: misstatement index
general deficiencies: misstatement index 1 ≥ 2≥1‰
0.5 ‰, and misstatement index 2 < 0.5 ‰;
important deficiencies: 0.5 ‰ ≤
misstatement index 2 <1 ‰; major
deficiencies: misstatement index 2 ≥ 1 ‰
Amount of significant defects in financial 0
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深圳中恒华发股份有限公司 2016 年年度报告全文
reports
Amount of significant defects in
0
non-financial reports
Amount of important defects in financial
0
reports
Amount of important defects in
0
non-financial reports
X. Auditing report of internal control
√ Applicable □ Not applicable
Deliberations in Internal Control Audit Report
We believes the Company was in accordance with the "basic norms of internal control" and the relevant provisions and maintained
effective internal control of financial reporting in all material respects on 31 Dec. 2016.
Disclosure details of audit report of
Disclosed
internal control
Disclosure date of audit report of
2017-04-25
internal control (full-text)
Index of audit report of internal
The designated website: Juchao Website
control (full-text)
Opinion type of auditing report of
Standard unqualified
IC
Whether the non-financial report
No
had major defects
Carried out modified opinion for internal control audit report from CPA
□Yes √ No
The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued from the Board
√ Yes □ No
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深圳中恒华发股份有限公司 2016 年年度报告全文
Section X Corporate Bond
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and without
due on the date when annual report approved for released or fail to cash in full on due
□Yes √ No
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深圳中恒华发股份有限公司 2016 年年度报告全文
Section XI. Financial Report
I. Audit report
Type of audit opinion Standard unqualified opinion
Signing date of audit report 2017-04-21
Name of audit institute DAXIN Certified Public Accountants LLP
Document serial of audit report Da Xin Shen Zi [2017] No.: 5-00204
Name of CPA Li Wei, Fan Zhang
Auditor’s Report
To all shareholders of Shenzhen Zhongheng Hwafa Co., Ltd.:
We have audited the companying consolidated and parent Company’s financial statements of Shenzhen
Zhongheng Hwafa Co., Ltd (“Zhongheng Hwafa Company”), including balance sheet of 31 December 2016, and
profit statement, and cash flow statement, and statement on changes of shareholders’ equity for the year ended,
and notes to the financial statements for the year ended.
I. Management’s responsibility for the financial statements
Management of the Company is responsible for prepare and present financial statement of the Company, which
including: (1) Prepare financial statements with fair presentation in line with Accounting Standards for Business
Enterprises; (2) Designing, executed and maintaining necessary internal control in order to prevent fundamental
miscarrying in financial statement from fraudulent or errors.
II. Auditor's responsibility
Our responsibility is to express an audit opinion on these financial statements based on our audit. We performed
our audit in accordance with Chinese Certified Public Accountants' Auditing Standards. Those standards require
us to comply with professional ethics, and to plan and perform our audit so as to obtain reasonable assurance
about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures of the
financial statements. The selective audit procedures depend on auditor's judgment, including the evaluation of the
risk of material misstatement of the consolidated financial statements due to frauds or errors. When evaluating
risk, we consider internal control related to financial statements, in order to design auditing procedures. An audit
also includes assessing the appropriateness of the accounting policies adopted and the reasonableness of the
accounting estimates made by management, as well as evaluating the overall presentation of the financial
statements.
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深圳中恒华发股份有限公司 2016 年年度报告全文
We believe that we have obtained sufficient and appropriate audit evidences to provide a basis for our audit
opinion.
III. Auditing opinion
In our opinion, in all material aspects, Zhongheng Hwafa’s financial statements have been prepared in accordance
with the Enterprises Accounting Standards and Enterprises Accounting System, and they fairly present the
financial status of the consolidated and parent company’s as of December 31, 2016, and its operation results and
cash flows for the year ended.
II．Financial statement
Currency used in note of financial statement is RMB (Yuan)
1. Consolidated Balance Sheet
Prepared by SHENZHEN ZHONGHENG HWAFA CO., LTD
2016-12-31
In RMB
Item Closing balance Opening balance
Current assets:
Monetary funds 93,332,709.81 662,115,464.19
Settlement provisions
Capital lent
Financial assets measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Notes receivable 52,663,100.89 54,346,509.74
Accounts receivable 139,808,058.20 109,965,992.14
Accounts paid in advance 13,075,721.93 3,092,021.10
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance
receivable
Interest receivable 1,838,752.40
Dividend receivable
Other receivables 3,934,376.89 9,312,148.07
Purchase restituted finance asset
Inventories 46,902,384.80 27,132,125.91
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深圳中恒华发股份有限公司 2016 年年度报告全文
Divided into assets held for sale 92,857,471.69
Non-current asset due within one
12,191.49
year
Other current assets
Total current assets 349,728,544.01 960,660,485.24
Non-current assets:
Loans and payments on behalf
Finance asset available for sales
Held-to-maturity investment
Long-term account receivable
Long-term equity investment
Investment real estate 54,145,225.02 30,019,906.66
Fix assets 81,544,707.02 110,607,425.50
Construction in progress 654,356.00 654,356.00
Engineering material
Disposal of fixed asset 92,857,471.69
Productive biological asset
Oil and gas asset
Intangible assets 44,878,095.77 46,372,390.49
Expense on Research and
Development
Goodwill
Long-term expenses to be
191,666.59 274,758.16
apportioned
Deferred income tax asset 8,475,476.30 6,400,271.29
Other non-current asset
Total non-current asset 282,746,998.39 194,329,108.10
Total assets 632,475,542.40 1,154,989,593.34
Current liabilities:
Short-term loans 181,210,467.81 119,479,107.41
Loan from central bank
Absorbing deposit and interbank
deposit
Capital borrowed
Financial liability measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
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深圳中恒华发股份有限公司 2016 年年度报告全文
Notes payable 16,714,584.01 53,614,420.20
Accounts payable 73,714,424.77 54,241,655.86
Accounts received in advance 48,846.60 1,147,469.52
Selling financial asset of
repurchase
Commission charge and
commission payable
Wage payable 4,542,531.22 4,731,615.47
Taxes payable 16,768,030.70 17,867,985.05
Interest payable
123,641.69
Dividend payable
Other accounts payable 17,050,035.16 32,665,698.32
Reinsurance payables
Insurance contract reserve
Security trading of agency
Security sales of agency
Divided into liability held for sale
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 310,172,561.96 283,747,951.83
Non-current liabilities:
Long-term loans 554,700,000.00
Bonds payable
Including: preferred stock
Perpetual capital
securities
Long-term account payable
Long-term wages payable
Special accounts payable
Projected liabilities 2,604,411.81 2,604,411.81
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 2,604,411.81 557,304,411.81
Total liabilities 312,776,973.77 841,052,363.64
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深圳中恒华发股份有限公司 2016 年年度报告全文
Owner’s equity:
Share capital 283,161,227.00 283,161,227.00
Other equity instrument
Including: preferred stock
Perpetual capital
securities
Capital public reserve 146,587,271.50 146,283,642.90
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus public reserve 77,391,593.25 77,391,593.25
Provision of general risk
Retained profit -187,441,523.12 -192,899,233.45
Total owner’s equity attributable to
319,698,568.63 313,937,229.70
parent company
Minority interests
Total owner’s equity 319,698,568.63 313,937,229.70
Total liabilities and owner’s equity 632,475,542.40 1,154,989,593.34
Legal representative: Li Zhongqiu Person in charge of accounting works:Yang Bin
Person in charge of accounting institution: Wu Aijie
2. Balance Sheet of Parent Company
In RMB
Item Closing balance Opening balance
Current assets:
Monetary funds 10,375,152.87 524,937,734.32
Financial assets measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Notes receivable
Accounts receivable 322,194.43
Account paid in advance 2,500,000.00 1,005,472.83
Interest receivable
Dividends receivable
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深圳中恒华发股份有限公司 2016 年年度报告全文
Other receivables 114,067,051.57 76,113,265.23
Inventories 14,806.50 14,806.50
Divided into assets held for sale 92,857,471.69
Non-current assets maturing within
one year
Other current assets
Total current assets 126,957,010.94 695,250,945.00
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investments
Long-term receivables
Long-term equity investment 186,608,900.00 186,608,900.00
Investment real estate 28,796,525.38 30,019,906.66
Fix assets 6,491,983.71 4,726,034.98
Construction in progress 654,356.00 654,356.00
Project materials
Disposal of fixed assets 92,857,471.69
Productive biological assets
Oil and natural gas assets
Intangible assets 4,988,546.40 5,133,492.12
Research and development costs
Goodwill
Long-term deferred expenses 191,666.59 241,666.63
Deferred income tax assets 9,217,543.32 7,204,895.54
Other non-current assets
Total non-current assets 329,806,993.09 234,589,251.93
Total assets 456,764,004.03 929,840,196.93
Current liabilities:
Short-term borrowings 120,000,000.00 19,600,000.00
Financial liability measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Notes payable
Accounts payable 10,745,840.16 10,745,840.16
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深圳中恒华发股份有限公司 2016 年年度报告全文
Accounts received in advance 44,162.00 735,382.00
Wage payable 857,735.20 788,575.28
Taxes payable 10,094,737.11 14,304,235.45
Interest payable
Dividend payable
Other accounts payable 13,383,939.40 26,415,353.86
Divided into liability held for sale
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 155,126,413.87 72,589,386.75
Non-current liabilities:
Long-term loans 554,700,000.00
Bonds payable
Including: preferred stock
Perpetual capital
securities
Long-term account payable
Long-term wages payable
Special accounts payable
Projected liabilities 2,604,411.81 2,604,411.81
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 2,604,411.81 557,304,411.81
Total liabilities 157,730,825.68 629,893,798.56
Owners’ equity:
Share capita 283,161,227.00 283,161,227.00
Other equity instrument
Including: preferred stock
Perpetual capital
securities
Capital public reserve 146,587,271.50 146,283,642.90
Less: Inventory shares
Other comprehensive income
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深圳中恒华发股份有限公司 2016 年年度报告全文
Reasonable reserve
Surplus reserve 77,391,593.25 77,391,593.25
Retained profit -208,106,913.40 -206,890,064.78
Total owner’s equity 299,033,178.35 299,946,398.37
Total liabilities and owner’s equity 456,764,004.03 929,840,196.93
3. Consolidated Profit Statement
In RMB
Item Current Period Last Period
I. Total operating income 619,167,770.74 499,455,781.11
Including: Operating income 619,167,770.74 499,455,781.11
Interest income
Insurance gained
Commission charge and commission
income
II. Total operating cost 611,110,771.22 527,629,119.93
Including: Operating cost 534,736,613.02 418,001,067.08
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
Taxes and surcharge 6,137,557.58 5,769,094.76
Sales expenses 11,415,270.82 11,427,705.20
Administration expenses 50,261,495.60 42,691,408.13
Financial expenses 5,012,897.34 48,393,716.52
Losses of devaluation of asset 3,546,936.86 1,346,128.24
Add: Changing income of fair
value(Loss is listed with “-”)
Investment income (Loss is listed 333,974.06 25,247,171.27
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深圳中恒华发股份有限公司 2016 年年度报告全文
with “-”)
Including: Investment income on
affiliated company and joint venture
Exchange income (Loss is listed
with “-”)
III. Operating profit (Loss is listed with
8,390,973.58 -2,926,167.55
“-”)
Add: Non-operating income 5,533,431.78 3,163,848.99
Including: Disposal gains of
122,730.30 453,321.89
non-current asset
Less: Non-operating expense 5,241,393.14 332,848.12
Including: Disposal loss of
40,598.22 4,270.45
non-current asset
IV. Total Profit (Loss is listed with “-”) 8,683,012.22 -95,166.68
Less: Income tax expense 3,225,301.89 4,105,678.93
V. Net profit (Net loss is listed with “-”) 5,457,710.33 -4,200,845.61
Net profit attributable to owner’s of
5,457,710.33 -4,200,845.61
parent company
Minority shareholders’ gains and
losses
VI. Net after-tax of other comprehensive
income
Net after-tax of other comprehensive
income attributable to owners of parent
company
(I) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1. Changes as a result of
re-measurement of net defined benefit
plan liability or asset
2. Share of the other
comprehensive income of the investee
accounted for using equity method which
will not be reclassified subsequently to
profit and loss
(II) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
73
深圳中恒华发股份有限公司 2016 年年度报告全文
1. Share of the other
comprehensive income of the investee
accounted for using equity method which
will be reclassified subsequently to profit
or loss
2. Gains or losses arising
from changes in fair value of
available-for-sale financial assets
3. Gains or losses arising
from reclassification of held-to-maturity
investment as available-for-sale financial
assets
4. The effect hedging portion
of gains or losses arising from cash flow
hedging instruments
5. Translation differences
arising on translation of foreign currency
financial statements
6. Other
Net after-tax of other comprehensive
income attributable to minority
shareholders
VII. Total comprehensive income 5,457,710.33 -4,200,845.61
Total comprehensive income
5,457,710.33 -4,200,845.61
attributable to owners of parent Company
Total comprehensive income
attributable to minority shareholders
VIII. Earnings per share:
(i) Basic earnings per share 0.0193 -0.0148
(ii) Diluted earnings per share 0.0193 -0.0148
Enterprise combine under the same control in the Period, the combined party realized net profit of 0 Yuan before combination, and
realized 0 Yuan at last period for combined party
Legal representative: Li Zhongqiu Person in charge of accounting works:Yang Bin
Person in charge of accounting institution: Wu Aijie
4. Profit Statement of Parent Company
In RMB
Item Current Period Last Period
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深圳中恒华发股份有限公司 2016 年年度报告全文
I. Operating income 43,547,414.64 54,055,168.03
Less: Operating cost 6,585,571.92 8,764,361.27
Taxes and surcharge 2,909,400.85 3,276,513.30
Sales expenses
Administration expenses 24,443,614.03 22,964,822.60
Financial expenses 5,510,413.62 47,475,979.01
Losses of devaluation of asset 3,296,102.05 1,344,755.83
Add: Changing income of fair
value(Loss is listed with “-”)
Investment income (Loss is
25,246,527.78
listed with “-”)
Including: Investment income
on affiliated company and joint venture
II. Operating profit (Loss is listed
802,312.17 -4,524,736.20
with “-”)
Add: Non-operating income 3,569,624.89 688,140.77
Including: Disposal gains of
341,452.77
non-current asset
Less: Non-operating expense 5,173,413.08 16,682.32
Including: Disposal loss of
18,924.00
non-current asset
III. Total Profit (Loss is listed with
-801,476.02 -3,853,277.75
“-”)
Less: Income tax expense 415,372.60 3,158,113.24
IV. Net profit (Net loss is listed with
-1,216,848.62 -7,011,390.99
“-”)
V. Net after-tax of other comprehensive
income
(I) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1. Changes as a result of
re-measurement of net defined benefit
plan liability or asset
2. Share of the other
comprehensive income of the investee
accounted for using equity method
which will not be reclassified
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深圳中恒华发股份有限公司 2016 年年度报告全文
subsequently to profit and loss
(II) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1. Share of the other
comprehensive income of the investee
accounted for using equity method
which will be reclassified subsequently
to profit or loss
2. Gains or losses arising
from changes in fair value of
available-for-sale financial assets
3. Gains or losses arising
from reclassification of held-to-maturity
investment as available-for-sale
financial assets
4. The effect hedging
portion of gains or losses arising from
cash flow hedging instruments
5. Translation differences
arising on translation of foreign
currency financial statements
6. Other
VI. Total comprehensive income -1,216,848.62 -7,011,390.99
VII. Earnings per share:
(i) Basic earnings per share
(ii) Diluted earnings per share
5. Consolidated Cash Flow Statement
In RMB
Item Current Period Last Period
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 576,271,328.32 513,469,704.97
services
Net increase of customer deposit
and interbank deposit
Net increase of loan from central
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深圳中恒华发股份有限公司 2016 年年度报告全文
bank
Net increase of capital borrowed
from other financial institution
Cash received from original
insurance contract fee
Net cash received from reinsurance
business
Net increase of insured savings and
investment
Net increase of amount from
disposal financial assets that measured
by fair value and with variation
reckoned into current gains/losses
Cash received from interest,
commission charge and commission
Net increase of capital borrowed
Net increase of returned business
capital
Write-back of tax received
Other cash received concerning
68,476,594.48 296,382,321.93
operating activities
Subtotal of cash inflow arising from
644,747,922.80 809,852,026.90
operating activities
Cash paid for purchasing
commodities and receiving labor 469,147,356.40 248,964,065.70
service
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 61,583,984.43 62,963,693.91
Taxes paid 21,225,973.55 19,396,559.05
Other cash paid concerning 111,483,905.00 305,041,692.25
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深圳中恒华发股份有限公司 2016 年年度报告全文
operating activities
Subtotal of cash outflow arising from
663,441,219.38 636,366,010.91
operating activities
Net cash flows arising from operating
-18,693,296.58 173,486,015.99
activities
II. Cash flows arising from investing
activities:
Cash received from recovering
334,700,000.00
investment
Cash received from investment
333,974.06
income
Net cash received from disposal of
fixed, intangible and other long-term 188,362.00
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
899,643.49
investing activities
Subtotal of cash inflow from investing
335,222,336.06 899,643.49
activities
Cash paid for purchasing fixed,
6,628,243.65 28,607,045.58
intangible and other long-term assets
Cash paid for investment 334,700,000.00
Net increase of mortgaged loans
Net cash received from
subsidiaries and other units obtained
Other cash paid concerning
investing activities
Subtotal of cash outflow from investing
341,328,243.65 28,607,045.58
activities
Net cash flows arising from investing
-6,105,907.59 -27,707,402.09
activities
III. Cash flows arising from financing
activities
Cash received from absorbing
303,628.60
investment
Including: Cash received from
absorbing minority shareholders’
investment by subsidiaries
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Cash received from loans 248,739,138.25 330,573,804.44
Cash received from issuing bonds
Other cash received concerning
1,062,033,333.35
financing activities
Subtotal of cash inflow from financing
249,042,766.85 1,392,607,137.79
activities
Cash paid for settling debts 743,361,629.35 379,809,073.35
Cash paid for dividend and profit
9,132,711.48 53,144,384.74
distributing or interest paying
Including: Dividend and profit of
minority shareholder paid by
subsidiaries
Other cash paid concerning
500,000,000.00
financing activities
Subtotal of cash outflow from financing
752,494,340.83 932,953,458.09
activities
Net cash flows arising from financing
-503,451,573.98 459,653,679.70
activities
IV. Influence on cash and cash
equivalents due to fluctuation in -580,865.04 5,022,515.44
exchange rate
V. Net increase of cash and cash
-528,831,643.19 610,454,809.04
equivalents
Add: Balance of cash and cash
632,846,956.16 22,392,147.12
equivalents at the period-begin
VI. Balance of cash and cash
104,015,312.97 632,846,956.16
equivalents at the period-end
6. Cash Flow Statement of Parent Company
In RMB
Item Current Period Last Period
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 21,453,165.00 52,034,400.65
services
Write-back of tax received
Other cash received concerning 76,073,111.02 68,155,035.46
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深圳中恒华发股份有限公司 2016 年年度报告全文
operating activities
Subtotal of cash inflow arising from
97,526,276.02 120,189,436.11
operating activities
Cash paid for purchasing
commodities and receiving labor 5,792,314.81 8,322,444.30
service
Cash paid to/for staff and workers 3,166,849.75 5,577,101.48
Taxes paid 11,555,523.30 6,560,587.94
Other cash paid concerning
127,611,991.39 75,777,962.88
operating activities
Subtotal of cash outflow arising from
148,126,679.25 96,238,096.60
operating activities
Net cash flows arising from operating
-50,600,403.23 23,951,339.51
activities
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 576.00
assets
Net cash received from disposal of
1,000,000.00
subsidiaries and other units
Other cash received concerning
investing activities
Subtotal of cash inflow from investing
576.00 1,000,000.00
activities
Cash paid for purchasing fixed,
2,763,012.20 304,712.00
intangible and other long-term assets
Cash paid for investment
Net cash received from
subsidiaries and other units
Other cash paid concerning
investing activities
Subtotal of cash outflow from investing
2,763,012.20 304,712.00
activities
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深圳中恒华发股份有限公司 2016 年年度报告全文
Net cash flows arising from investing
-2,762,436.20 695,288.00
activities
III. Cash flows arising from financing
activities
Cash received from absorbing
303,628.60
investment
Cash received from loans 120,000,000.00 19,600,000.00
Cash received from issuing bonds
Other cash received concerning
1,062,033,333.35
financing activities
Subtotal of cash inflow from financing
120,303,628.60 1,081,633,333.35
activities
Cash paid for settling debts 574,300,000.00 50,600,000.00
Cash paid for dividend and profit
7,203,237.97 45,555,697.47
distributing or interest paying
Other cash paid concerning
500,000,000.00
financing activities
Subtotal of cash outflow from financing
581,503,237.97 596,155,697.47
activities
Net cash flows arising from financing
-461,199,609.37 485,477,635.88
activities
IV. Influence on cash and cash
equivalents due to fluctuation in -132.65 11,212.34
exchange rate
V. Net increase of cash and cash
-514,562,581.45 510,135,475.73
equivalents
Add: Balance of cash and cash
524,937,734.32 14,802,258.59
equivalents at the period -begin
VI. Balance of cash and cash
10,375,152.87 524,937,734.32
equivalents at the period -end
7. Statement of Changes in Owners’ Equity (Consolidated)
This Period
In RMB
This Period
Owners’ equity attributable to parent company Minorit Total
Item
Other Capital Less: Other Reason Surplus Provisio Retaine y owners’
Share interests equity
equity instrument reserve Invento compre able reserve n of d profit
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深圳中恒华发股份有限公司 2016 年年度报告全文
capital Perpet ry hensive reserve general
ual shares income risk
Prefer
capita
red Other
l
stock
securi
ties
283,16 -195,42
I. Balance at the 146,283 77,391, 311,406
1,227. 9,900.9
end of the last year ,642.90 593.25 ,562.20
00 5
Add:
Changes of
accounting policy
Error 2,530,6 2,530,6
correction of the
67.50 67.50
last period
Enterprise
combine under
the same control
Other
II. Balance at the 283,16 146,283 77,391,
-192,89
313,937
beginning of this 1,227. 9,233.4
,642.90 593.25 ,229.70
year 00 5
III. Increase/
Decrease in this 303,628 5,457,7 5,761,3
year (Decrease is .60 10.33 38.93
listed with “-”)
(i) Total 5,457,7 5,457,7
comprehensive
10.33 10.33
income
(ii) Owners’ 303,628 303,628
devoted and
.60 .60
decreased capital
1.Common shares
invested by
shareholders
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
303,628 303,628
4. Other
.60 .60
(III) Profit
distribution
1. Withdrawal of
surplus reserves
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深圳中恒华发股份有限公司 2016 年年度报告全文
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
4. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Other
(V) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(VI)Others
IV. Balance at the 283,16 146,587 77,391,
-187,44
319,698
end of the report 1,227. 1,523.1
,271.50 593.25 ,568.63
period 00 2
Last Period
In RMB
Last Period
Owners’ equity attributable to the parent Company
Other
equity instrument Minorit
Item Less: Other Provisio Total
Perpet Reason y
Share
ual Capital Invento compre Surplus n of Retaine interest owners’
Prefer able equity
capital capita reserve ry hensive reserve general d profit s
red Other reserve
l shares income risk
stock
securi
ties
I. Balance at the 283,16 -188,69
109,496 77,391, 281,351
end of the last year 1,227. 8,387.8
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深圳中恒华发股份有限公司 2016 年年度报告全文
00 ,837.33 593.25 4 ,269.74
Add:
Changes of
accounting policy
Error
correction of the
last period
Enterprise
combine under the
same control
Other
II. Balance at the 283,16 -188,69
109,496 77,391, 281,351
beginning of this 1,227. 8,387.8
,837.33 593.25 ,269.74
year 00 4
III. Increase/
Decrease in this 36,786, -4,200,8 32,585,
year (Decrease is 805.57 45.61 959.96
listed with “-”)
(i) Total -4,200,8 -4,200,8
comprehensive
45.61 45.61
income
(ii) Owners’ 36,786, 36,786,
devoted and
805.57 805.57
decreased capital
1.Common shares
invested by
shareholders
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
36,786, 36,786,
4 Other
805.57 805.57
(III) Profit
distribution
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
4. Other
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深圳中恒华发股份有限公司 2016 年年度报告全文
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Other
(V) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(VI)Others
IV. Balance at the 283,16 -192,89
146,283 77,391, 313,937
end of the report 1,227. 9,233.4
,642.90 593.25 ,229.70
period 00 5
8. Statement of Changes in Owners’ Equity (Parent Company)
This Period
In RMB
This Period
Other
equity instrument
Other Total
Item Share Perpetu Less: Retaine
Capital comprehe Reasonab Surplus
al Inventory owners’
capital Preferre reserve nsive le reserve reserve d profit
capital Other shares equity
d stock income
securiti
es
-209,42
I. Balance at the 283,161, 146,283,6 77,391,59 297,415,7
0,732.2
end of the last year 227.00 42.90 3.25 30.87
8
Add: Changes 2,530,6 2,530,667
of accounting
67.50 .50
policy
Error
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深圳中恒华发股份有限公司 2016 年年度报告全文
correction of the
last period
Other
II. Balance at the 283,161, -206,89
146,283,6 77,391,59 299,946,3
beginning of this 0,064.7
227.00 42.90 3.25 98.37
year 8
III. Increase/
Decrease in this 303,628.6 -1,216,8 -913,220.
year (Decrease is 0 48.62 02
listed with “-”)
(i) Total -1,216,8 -1,216,84
comprehensive
48.62 8.62
income
(ii) Owners’ 303,628.6 303,628.6
devoted and
0 0
decreased capital
1.Common shares
invested by
shareholders
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
303,628.6 303,628.6
4. Other
0 0
(III) Profit
distribution
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
3. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
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深圳中恒华发股份有限公司 2016 年年度报告全文
3. Remedying loss
with surplus
reserve
4. Other
(V) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(VI)Others
IV. Balance at the 283,161, -208,10
146,587,2 77,391,59 299,033,1
end of the report 6,913.4
227.00 71.50 3.25 78.35
period 0
Last period
In RMB
Last period
Other
equity instrument
Other Total
Item Perpetu Less:
Share Capital comprehe Reasonab Surplus Retaine
al Inventory owners’
capital Preferre reserve nsive le reserve reserve d profit
capital Other shares equity
d stock income
securiti
es
-199,87
I. Balance at the 283,161, 109,496,8 77,391,59 270,170,9
8,673.7
end of the last year 227.00 37.33 3.25 83.79
9
Add: Changes
of accounting
policy
Error
correction of the
last period
Other
II. Balance at the 283,161, -199,87
109,496,8 77,391,59 270,170,9
beginning of this 8,673.7
227.00 37.33 3.25 83.79
year 9
III. Increase/
Decrease in this 36,786,80 -7,011,3 29,775,41
year (Decrease is 5.57 90.99 4.58
listed with “-”)
(i) Total -7,011,3 -7,011,39
comprehensive
90.99 0.99
income
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深圳中恒华发股份有限公司 2016 年年度报告全文
(ii) Owners’ 36,786,80 36,786,80
devoted and
5.57 5.57
decreased capital
1.Common shares
invested by
shareholders
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
36,786,80 36,786,80
4. Other
5.57 5.57
(III) Profit
distribution
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
3. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Other
(V) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(VI)Others
IV. Balance at the
283,161, 146,283,6 77,391,59 -206,89 299,946,3
end of the report
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深圳中恒华发股份有限公司 2016 年年度报告全文
period 227.00 42.90 3.25 0,064.7 98.37
8
III. Company profile
1. The registration place of the enterprise, the form of organization and the headquarters address
Shenzh Zhongheng Hwafa Company Limited (hereinafter referred to as Company or the Company), established on 8 December 1981.
uniform social cedit code 91440300618830372G.
Registered place and head office of the Company: 411 Bldg., Huafa (N) Road, Futian District, Shenzhen
Legal representative: Li Zhongqiu
Registered capital: RMB 283,161,227
2. The nature of the business and the main business activities
The Company belongs to the computer, telecommunication and manufacturing of other electronic equipment. Business scope:
producing and sales of vary colour TV set, liquid crystal disply, LCD (operates in branch), radio-recorder, sound equipment,
electronic eatch, electronic game and computers, the printed wiring board, precision injection parts, light packaging material
(operates in Wuhan) and hardware (including tool and mould) for various elctronic producs and supporting parts, plating and surface
treatment and tin wire, development and operation of real estate (Shen Fang Di Zi No.: 7226760) and property management. Funded
affiliated companies in Wuhan and Julin. Setting up branches in capital of the province (Lhasa City excluded) in China and
municipality directrly under the central government.
3. Relevant party offering approval reporting of financial statements and date thereof
The financial statement has been deliberated and approved by BOD on 21 April 2017. According to Article of Association, the
statement shall be submit for deliberation in shareholders general meeting.
4. Scope of consolidate financial statement
Consolidate scope in the Period including: parent company – Shenzhen Zhongheng Hwafa Company Limited, subsidiary including
Shenzhen Hwafa Perpoerty Leasing Management Co., Ltd. (no annual inspection in 2011, and business license revoke on 1 April
2014 ), Shenzhen Zhongheng Hwafa perperty Co., Ltd., Wuhan Hengfa Technology Co., Ltd., Shenzhen Hwafa Hengtian Co., Ltd.
and Shenzhen Hwafa Hengtai Co., Ltd. more of subsidiaries found in “Note IX. Equity in other subjects”.
IV. Preparation basis of Financial Statements
1. Preparation basis
Base on the running continuously and actual transactions and events, in line with the Accounting Standards for Business Enterprise –
Basic Standards and specific principle of accounting standards issued by the Ministry of Finance, the Company prepared and
formulate the financial statement lies on the followed important accounting policy and estimation.
2. Going concern
The Company estimated that the production and sales of the Company, in 12 months since end of the period, will in a virtuous cycle.
We has good management and continuous operation ability, and there is no risk of continuing operations.
V. Important accounting policy and estimation
Whether the company needs to comply with the disclosure requirements of the particular industry
No
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深圳中恒华发股份有限公司 2016 年年度报告全文
Notes on specific accounting policies and accounting estimation:
According to actual operation charateristic, the Group formulate specific accounting policy and accounting estimation, including
trade cycle, recognization and measurement on account bad debt provision of receivables, inventory measurement, classification and
depreciation method of fixed assets, intangible assets amortization and recognization and measurement of revenue etc.
1. Declaration of obedience to Accounting Standards for Business Enterprise
The Financial Statements of the Company are up to requirements of Accounting Standards for Business Enterprise and also a true and
thorough reflection to the relevant information as the Company’s financial position dated 30th June 2016 and the operation results as
well as cash flow for the year of 2016.
2. Accounting period
The Company’s accounting year is Gregorian calendar year, namely from 1st January to 31st December of every year.
3. Business cycle
The Company’s business cycle is one year (12 months) as a normal cycle, and the business cycle is the determining criterion for the
liquidity of assets and liabilities of the Company.
4. Bookkeeping standard currency
The Renminbi (RMB) is taken as the book-keeping standard currency.
5. Accounting methods for consolidation of enterprises under the same control or otherwise
(1) Consolidation of enterprises under the same control
Where the Company for long term equity investment arising from business combination under common control satisfies the
combination consideration by payment of cash, transfer of non-cash assets or assumption of debt, the carrying value of the net assets
of the acquire in combined financial statement of the ultimate controller shared by the Company as at the combination date shall be
deemed as the initial investment cost of such long term equity investment. If the equity instrument issued by combining party are
consider as the combination consideration, than the total value of the issuing shares are consider as the share capital. The difference
between the initial cost of long-term equity investment and book value of consideration (or total face value of the shares issued) paid,
capital surplus adjusted; if the capital surplus not enough to written down, than retained earning adjusted.
(2) Business combination not under common control
As for business combination not under common control, combination costs refer to the sum of the fair value of the assets paid,
liabilities occurred or assumed as well as equity securities issued by the acquirer to obtain control over the acquire as at the
acquisition date. As for acquiree that obtained by consolidation not under the same control, the qualified confirmation of identified
assets, liability and contingency liabilities should calculated by fair value on day of purchased. If the consolidation cost larger than
the fair value amount of indentified net assets from acquiree’s, the differences should be recognized as goodwill. If the consolidation
cost less than the fair value amount of indentified net assets from acquiree’s, the differences should reckoned into current gains/losses
after re-examination.
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深圳中恒华发股份有限公司 2016 年年度报告全文
6. Preparation methods for consolidated financial statements
(1) Consolidation financial statement range
The Company includes all the subsidiaries (including the separate entities controlled by the Company) into consolidated financial
statement, including companies controlled by the Company, non-integral part of the investees and structural main body.
(2) Centralize accounting policies, balance sheet dates and accounting periods of parent and subsidiaries.
As for the inconsistency between the subsidiaries and the Company in the accounting policies and periods, the necessary adjustment
is made on the subsidiaries’ financial statements in the preparation of the consolidated financial statements according to the
Company’s accounting policies and periods.
(3) Setoff of consolidated financial statement
The consolidated financial statements shall be prepared on the basis of the balance sheet of the parent company and subsidiaries,
which offset the internal transactions incurred between the parent company and subsidiaries and within subsidiaries. The owner’s
equity of the subsidiaries not attributable to the parent company shall be presented as minority equity under the owner’s equity item
in the consolidated balance sheet. The long term equity investment of the parent company held by the subsidiaries, deemed as
treasury stock of the corporate group as well as the reduction of owners’ equity, shall be presented as “Less: treasury stock” under the
owners’ equity item in the consolidated balance sheet.
(4) Accounting for acquisition of subsidiary through combination
For subsidiaries acquired under enterprise merger involving enterprises under common control, the assets,
liabilities, operating results and cash flows of the subsidiaries are included in the consolidated financial statements from the
beginning of the financial year in which the combination took place. When preparing the consolidated financial
statements, for the subsidiaries acquired from business combination not involving entities under common control, the
identifiable net assets of the subsidiaries are adjusted on the basis of their fair values on the date of acquisition.
7. Classification of joint arrangements and accounting treatment of joint operation
(1) Classification of joint arrangements
Joint arrangements are divided into joint operations and joint ventures. Joint arrangements achieved not through separate entities are
classified as joint operations. Separate entities refer to the entities with separate identifiable financial architecture including separate
legal entities and legally recognized entities without the qualification of legal entity. Joint arrangements achieved through separate
entities are generally classified as joint ventures. In case of changes in rights entitled to and obligations undertaken by the parties of
joint venture under a joint arrangement due to the changes in relevant facts and circumstances, the parties of joint venture will
re-assess the classification of joint arrangements.
(2) Accounting treatment for joint operations
The parties of joint operation should recognize the following items in relation to their share of interest in joint operation, and proceed
with accounting in accordance with the relevant provisions under the Accounting Standards for Business Enterprises: to recognize
their separate assets or liabilities held, and recognize the assets or liabilities jointly held according to their respective shares; to
recognize the income from the disposal of their output share under joint operation; to recognize the income from the disposal of
output under joint operation according to their respective shares; to recognize the expenses incurred separately, and recognize the
expenses incurred under joint operation according to their respective shares.
For the parties of a joint operation not under common control, if they are entitled to relevant assets and undertake relevant liabilities
of the joint operation, accounting will be carried out with reference to the provisions of the parties of joint operation; otherwise, it
should be subject to relevant Accounting Standards for Business Enterprises.
(3) Accounting treatment for joint ventures
The parties of a joint venture should perform accounting for investments by the joint venture in accordance with the Accounting
Standards for Business Enterprises No. 2 – Long-term Equity Investments. The parties not under common control should carry out
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深圳中恒华发股份有限公司 2016 年年度报告全文
accounting depending on their influence on the joint venture.
8. Determination criteria of cash and cash equivalent
The cash recognized in the preparation of the cash flow statements, is the Company’s storage cash and deposits available for payment
anytime. The cash equivalents recognized in the preparation of the cash flow statements refers to the investment held by the
Company with characteristic of short-term, strong mobility, easy transfer to known sum cash and has slim risk from value changes.
9. Foreign currency exchange and the conversion of foreign currency statements
(1) Foreign currency exchange
The foreign trading, shall be converted with the rates of exchange, released by People’s Bank of China at beginning of the current
month, when trading occurred. On the balance sheet day, the monetary items are converted on the current rate on the balance sheet
day, concerning the exchange differences between the spot exchange rate on that date and initial confirmation or the sport exchange
rate on previously balance sheet date, should reckoned in to current gains/losses except the capitalizing on exchange differences for
foreign specific loans, which was reckoned into cost for capitalizing. The non-monetary items measured on the historic cost are still
measured by the original bookkeeping rate with the sum of the bookkeeping standard currency unchanged. Items of non-monetary
foreign currency which was calculated by fair value, should converted by spot exchange rate on the confirmation day of fair value,
difference between the converted amount of bookkeeping currency and original amount of bookkeeping currency, was treated as
changes of fair value (including exchange rate changed) reckoned into current gains/losses or recognized as other consolidated
income.
(2) Conversion of foreign currency financial statements
Upon the conversion of the foreign currency financial statements of the controlling subsidiaries, joint enterprises, and the affiliated
enterprises on the bookkeeping standard currency different from the Company’s, the accounting check and preparation of the
consolidated financial statements are made. Assets and liabilities items in the balance sheet are converted on the current rate on the
balance sheet day; owners’ equity items besides the “retained profit” item, the other items are converted on the actual rate. The
revenue and expenses, shall be converted with the rates of exchange, released by People’s Bank of China at beginning of the current
month, when trading occurred. The conversion difference of the foreign currency financial statements is listed specifically in the
owners’ equity in the balance sheet. The cash flow of foreign currency, which was recognized by systematic rational method, shall be
converted with the rates of exchange, released by People’s Bank of China at beginning of the current month, when trading occurred.
The cash influenced by the rate fluctuation is listed specifically in the cash flow statement. As for the foreign operation, the
conversion difference of the foreign currency statement related to the foreign operation is transferred in proportion into the disposal
of the current loss/gain.
10. Financial instruments
(1) Categories and recognition of financial instruments
The financial instruments are classified as the financial assets, liabilities and equity instruments. As the Company becomes one party
of the financial instrument contract, the instrument is recognized as one financial asset, liability or equity instruments.
In the initial recognition, the financial assets are classified as, the financial assets measured on fair value and with its changes
reckoned into the current loss/gain, long-term invest-bonds, account receivables, and financial assets available for sale. Categories of
the financial assets besides account receivables are dependent on the holding intention and purpose of the Company and its
subsidiaries for the financial assets. In the initial recognition, the financial liabilities are classified as the financial liabilities measured
on the fair value and with its changes reckoned into the current loss/gain, other financial liabilities.
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深圳中恒华发股份有限公司 2016 年年度报告全文
The financial assets measured by fair value and with its variation reckoned into current gains/losses including the transacitonal
finacnial assets held for sale in short period, and the financial assets initially recognzied as financial assets measured by fair value
and with its variation reckoned into current gains/losses; receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market; available-for-sale financial assets are non-derivative financial assets that are either
designated in this category or not classified in any of the other categories at initial recognition; held-to-maturity investments are
non-derivative financial assets with fixed maturity and fixed or determinable payments that management has the positive intention
and ability to hold to maturity.
(2) Measurement of financial instruments
In the initial recognition, the financial instruments are measured on fair value; and the follow-up measurements are: financial assets
and financial assets available for sale that measured by fair value and with alteration reckoned into current gains/losses together with
the financial liabilities that measured by fair value with alteration reckoned into current gains/losses should measured by fair value;
the held-to-maturity securities, loans, account receivable and other financial liability are measured by amortized cost; as for the
equity instrument investment without quote in an active market and with its fair value can not be reliably measured, and those
derivative financial assets or liability that paid with equity instrument, which have hook with such instrument, should measured by
cost. The loss/gain from the fair value changes in the follow-up measurement of the financial assets and liabilities, besides one
related to the hedge, is dealt with in the following methods: ① The financial assets or liabilities measured on the fair value and with
its changes reckoned into the current loss/gain, are reckoned into the fair value loss/gain; ② The fair value change of the financial
assets available for sale, is reckoned into the other comprehensive income.
(3) Recognition of the fair value for the financial assets and liabilities
For those financial instruments existing in active markets, market quotation in the active market is used to confirm their fair values;
fair value of the financial instruments which have no active market is confirmed by adoption of estimation technology. The
estimation technology mainly including market approach, income approach and cost method
(4) Recognition basis and measurement method for the transfer of financial assets/liabilities
As for the financial assets with all risks and compensations on their patent transferred, or all risks and compensations neither
maintained nor transferred but the control over the assets given up, the recognition of the financial asset may terminate. For the
financial assets are qualified for the recognition of termination conditions, the measurement may be taken on the financial assets
transfer, namely the difference is reckoned into the current loss/gain, between the book value of the transferred financial assets and,
the total of the consideration value received from the transfer and the fair value change accumulative sum originally booked into the
capital reserve. If the partial transfer satisfies the criteria for derecognition, the entire carrying value of the transferred financial asset
shall proportionally allocated between the derecognized portion and the retained portion according to their respective relative fair
value.
When all or part of the current obligation to a financial liability has been terminated, the entire or part of such financial liability shall
be derecognized.
(5) Impairment loss on financial assets
When an impairment loss on a financial asset carried at amortised cost has occurred, the amount of loss is provided for at the
difference between the asset’s carrying amount and the present value of its estimated future cash flows (excluding future credit losses
that have not been incurred). If there is objective evidence that the value of the financial asset recovered and the recovery is related
objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed and the
amount of reversal is recognised in profit or loss.
Where there is objective evidence that an impairment loss on available-for-sale financial assets occurs, the cumulative loss arising
from the decline in fair value that had been recognised directly in equity is removed from equity and recognised in impairment loss.
For en investment in debt instrument classified as available-for-sale on which impairment losses have been recognised, if, in a
subsequent period, its fair value increases and the increase can be objectively related to an even occurring after the impairment loss
was recognised in profit or loss, the previously recognised impairment loss is reversed and recognised in profit or loss for the current
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深圳中恒华发股份有限公司 2016 年年度报告全文
period. For an investment in an equity instrument classified as available-for-sale on which impairment losses have been recognised,
the increase in its fair value in a subsequent period is recognised in equity directly.
For investments in equity instruments, the specific quantitative criteria for the Company to determine “serious” or “not temporary”
decrease in their fair value, cost computing method, method for determining closing fair value, and basis for determining the
continuous decrease period are set out below:
Specific quantitative criterion on “serious” decrease in their Decrease in closing fair value relative to the cost has reached or
fair value exceeded 50%
Specific quantitative criterion on “not temporary” decrease in
Fall for 12 consecutive months
their fair value
Consideration of payment at acquisition (net of cash dividends
Cost computing method declared but not yet paid or due but unpaid interest on bonds) and the
relevant transaction cost are recognized as the investment cost.
As for a financial instrument for which there is an active market, the
quoted prices in the active market shall be used to recognize the fair
Method for determining closing fair value values thereof. Where there is no active market for a financial
instrument, the enterprise concerned shall adopt value appraisal
techniques to determine its fair value.
The rebound in the continuous fall or the period with the tread of fall
Basis for determining the
is less than 20% margin. Rebound duration not more than six months
continuous decrease period
is treated as continuous decrease period.
11. Account receivable
(1) Account receivables with single major amount and withdrawal bad debt provision independently
Book balance of the account receivable with over 0.5 million
Criterion or amount standards of major single amount
Yuan
Withdrawal method for individual bad debt provision accrual Recognized on the difference between the book value and the
with major single amount concerned current value of the estimative future cash flow
(2) Account receivable with bad debt provision accrual by portfolio
Portfolio Accrued method for bad
Age portfolio Aging of accounts
Withdrawing bad bed provision by aging method in portfolio:
√ Applicable □ Not applicable
Accrued proportion of other accounts
Account ages Accrued proportion of accounts receivable
receivable
Within one year (one year included) 0.00% 0.00%
1－2 years 5.00% 5.00%
2－3 years 10.00% 10.00%
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深圳中恒华发股份有限公司 2016 年年度报告全文
Over three years 30.00% 30.00%
Withdrawing bad bed provision by percentage of total accounts receivable outstanding in portfolio :
□ Applicable √ Not applicable
Withdrawing bad bed provision by other methods in portfolio :
□ Applicable √ Not applicable
(3) Account receivable with minor single amount but has individual bad debt provision accrual
Receivable has minor amount and can not reflect the risk
Reasons for individual bad debt prevision accrual
characteristic by withdrawing bad debt provision by group
Recognized on the difference between the book value and the
Accrued method for bad debt provision
current value of the estimative future cash flow
12. Inventory
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Categories of inventory
The inventory is goods or manufactured products held for sale, products in process, and materials and matters utilized in the
production or supply of labor. It mainly consists of the raw material, products in process, inventory goods, consumable low-value
product, homemade semi-finished products and commissioned processing materials etc.
(2) Accounting method for inventory delivery
When inventories are issued, the actual cost is determined by the first in first out method.
(3) Accrual method inventory falling price reserves
On the balance sheet day, the inventory is measured on the lower one between the cost and the net realizable value, and the provision
for the falling price reserves is accrued on each inventory item; however, as for the inventory of large quantity and low price, the
provision is accrued on the inventory category.
(4) Inventory system
Inventory system of the Company is perpetual inventory system
(5) Amortization method for the low-value consumables and wrap page
Low-value consumables and packages are amortized by one-point method
13. Classify to assets available for sale
The non-current assets meet the following conditions shall classify as assets availabel for sale: 1. resolution of disposal on such
non-current assts are being made; 2. Signing an irrevocable transfer agreement with acquiring party; and 3. the transfer will complete
in one year.
14. Long term equity investment
(1) Recognition of initial investment cost
Initial investment cost of long term equity investment obtained by corporate consolidation: in the case of the consolidation of
enterprises under the same control, recognized as the initial cost is the book value of the owners’ equity obtained from the
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深圳中恒华发股份有限公司 2016 年年度报告全文
consolidated party; in the case of the consolidation of enterprises not under the same control, recognized as the initial cost is the
recognized consolidation cost on the purchase day. As for the long term equity investment obtained by cash payment, the initial
investment cost is the actual purchase payment. As for the long term equity investment obtained by the equity securities offering, the
initial investment cost is the fair value of the equity securities. As for the long-term equity investment obtained by debt
reorganization, initial investment cost of such investment should determine by relevant regulation of the “Accounting Standards for
Business Enterprise No.12- Debt Reorganization”; As for the long term equity investment obtained by the exchange of the
non-monetary assets and the debts restructuring, the initial investment cost is recognized on the relevant rules in the Principles.
(2) Subsequent measurement and profit or loss recognition
Where the investor has a control over the investee, long-term equity investments are measured using cost method. Long-term equity
investments in associates and joint ventures are measured using equity method. Where part of the equity investments of an investor in
its associates are held indirectly through venture investment institutions, common fund, trust companies or other similar entities
including investment linked insurance funds, such part of equity investments indirectly held by the investor shall be measured at fair
value through profit or loss according to according to relevant requirements of Accounting Standards for Business Enterprises
No.22—Recognizition and measurement of Financial Instruments regardless whether the above entities have significant influence on
such part of equity investments, while the remaining part shall be measured using equity method.
(3) Basis of conclusion for common control and significant influence over the investee
Joint control over an investee refers to where the activities which have a significant influence on return on certain arrangement could
be decided only by mutual consent of the investing parties sharing the control, which includes the sales and purchase of goods or
services, management of financial assets, acquisition and disposal of assets, research and development activities and financing
activities, etc.; Significant influence on the investee refers to that: significant influence over the investee exists when holding more
than 20% but less than 50% of the shares with voting rights or even if the holding is below 20%, there is still significant influence if
any of the following conditions is met: there is representative in the board of directors or similar governing body of the investee;
participation in the investee’s policy setting process; assign key management to the investee; the investee relies on the technology or
technical information of the investing company; or major transactions with the investee.
15. Investment real estate
Measurement for investment real estate
Cost method
Depreciation or amortization method
The leased buildings in the Company’s investment property adopts straight-line depreciation to calculate and distill depreciation, the
specific depreciation period is 5 to 50 years, the estimated residual rate is 10.00%, and the annual depreciation rate is 1.80% -18.00%;
the leased land use rights in the investment property and the land use rights to be transferred after appreciation adopt straight-line
amortization, the specific amortization period is 50 years, the estimated residual rate is 10.00%, and the annual amortization rate is
1.80%
16. Fixed assets
(1) Recognition
The fixed assets refers to the tangible assets that possess the features as follows: 1. they are held for the sake of producing
commodities, rendering labor service, renting or business management; and 2.their useful life is in excess of one fiscal year with over
2000 Yuan in value. Meanwhile as up to the following conditions, they are recognized: the economic interest related to the fixed
assets probably flow into the Company; the cost of the fixed assets can be measured reliably.
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深圳中恒华发股份有限公司 2016 年年度报告全文
(2) Depreciation method
Category Depreciation method Depreciation life (year) Salvage rate Annual depreciation rate
House building Straight-line depreciation 20-50 10.00% 1.80%-4.50%
Machine equipment Straight-line depreciation 10 10.00% 9.00%
Mold equipment Straight-line depreciation 3 10.00% 30.00%
Transportation
Straight-line depreciation 5 10.00% 18.00%
equipment
Instrument equipment Straight-line depreciation 5 10.00% 18.00%
Tool equipment Straight-line depreciation 5 10.00% 18.00%
Office equipment Straight-line depreciation 5 10.00% 18.00%
17. Project in progress
Whether the company needs to comply with the disclosure requirements of the particular industry
No
Project in progress of the Company divided as self-run construction and out-bag construction. The project in progress of the
Company carried forward as fixed assets while the construction is ready for the intended use. Criteria of the expected condition for
use should apply one of the follow conditions: The substance construction (installation included) of the fixed assets has completed all
or basically; As the projects have been in test production or operation, and the results show that the assets can operate properly and
produce the qualified products stably, or the test operation result shows the assets can operate or open properly. The expenditure of
the fixed assets on the construction is a little or little. The fixed assets of the project constructed have been up to the requirements of
the design or contract, or basically up to.
18. Borrowing expenses
(1) Recognition principle on capitalization of borrowing expenses
As for the Company’s actual borrowing expenses directly attributable to the assets construction or production, it is capitalized and
reckoned into the relevant assets cost; as for other borrowing expenses, it is recognized on the actual sum and reckoned into the
current loss/gain. The assets up to the capitalization are assets as the capital assets, investment real estate, and inventory reaching the
expectant availability or sale ability.
(2) Calculation of the capitalization
Capitalization term: the period from the time starts to capitalization to the time the capitalization ends. The period of capitalization
suspended is not included. The capitalization of borrowing expenses should be suspended while the abnormal interrupt, which
surpass three months continuously, in the middle of acquisition or construction or production.
As for the borrowing of the specific borrowing, the capitalization sum is recognized on the current actual interest expenses less the
interest income of the borrowing capital not utilized but deposited in the bank or the return of the temporary investment; As for the
appropriation of the general borrowing, the capitalization sum is recognized on the weighted average of, the accumulative assets
expenditure above the specific borrowing, and times the capitalization rate of the appropriation; As for the discount or premium of
the borrowing, the discount or premium to be diluted in every accounting period is recognized in the actual rate method.
The effective interest method is the method for the measurement of the diluted discount or premium or interest expenses on the actual
interest rate; and the actual interest rate is the interest rate used in the discount of the future cash flow in the expectant duration period
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深圳中恒华发股份有限公司 2016 年年度报告全文
as the current book value of the borrowing.
19. Intangible assets
(1) Accounting method, service life and impairment test
The Company’s intangible assets are measured initially on cost. The intangible assets purchased in are taken as the actual cost on the
actual payment and relevant expenditure. As for the intangible assets invested in by the investors, the actual cost is recognized on the
value stipulated in the contract or agreement; however, if what is stipulated in the contract or agreement is not fair value, the actual
cost is recognized on fair value. As for the self-developed intangible assets, their cost is the actual total expenditure before reaching
the expectant purpose.
The follow-up measurements of the Company’s intangible assets respectively are: the line amortization method is taken on the
intangible assets of finite service life, and at the yea-end, the check is taken on the service life and dilution of the intangible assets,
and the corresponding adjustment is made if there is inconsistency with the previous estimative ones. As for the intangible assets of
uncertain service life, it is not diluted, however, the service life is checked at year-end; If there is solid evidence to its finite service
life, its service life is estimated and diluted in straight line method.
20. Long-term investment impairment
Long-term equity investments, investment properties measured at cost and long-term assets such as fixed assets, construction in
progress, productive biological assets at cost method, oil and gas assets, intangible assets and goodwill are tested for impairment if
there is any indication that an asset may be impaired at the balance date. If the result of the impairment test indicates that the
recoverable amount of the asset is less than its carrying amount, a provision for impairment and an impairment loss are recognised
for the amount by which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs to sell and the present value of the future cash flows expected
to be derived from the asset. Provision for asset impairment is determined and recognised on the individual asset basis. If it is not
possible to estimate the recoverable amount of an individual asset, the recoverable amount of a group of assets to which the asset
belongs is determined. A group of assets is the smallest group of assets that is able to generate independent cash inflows.
Goodwill arising from a business combination is tested for impairment at least at each year end, irrespective of whether there is any
indication that the asset may be impaired. For the purpose of impairment testing, the carrying amount of goodwill acquired in a
business combination is allocated from the acquisition date on a reasonable basis to each of the related asset groups; if it is
impossible to allocate to the related asset groups, it is allocated to each of the related set of asset groups. If the carrying amount of the
asset group or set of asset groups is higher than its recoverable amount, the amount of the impairment loss first reduced by the
carrying amount of the goodwill allocated to the asset group or set of asset groups, and then the carrying amount of other assets
(other than the goodwill) within the asset group or set of asset groups, pro rata based on the carrying amount of each asset.
Once the impairment loss of such assets is recognized, it is not be reversed in any subsequent period.
21. Long-term deferred expenditure
The Company’s long-term deferred expenditure are expenses paid out and with one year above (1-year included) benefit period. The
long-term unamortized expenses are diluted by periods according to the benefit period. As the long-term unamortized expenses
cannot enable the accounting period’s beneficiary, all dilution values of the project undiluted yet, are transferred into the current
loss/gain.
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22. Employees benefits
(1) Accounting for short-term benefits
In the period of employee services, short-term benefits are actually recognized as liabilities and charged to profit or loss, or if
otherwise required or allowed by other accounting standards, to the related costs of assets for the current period. At the time of actual
occurrence, The Company’s employee benefits are recorded into the profits and losses of the current year or assets associated costs
according to the actual amount. The non-monetary employee benefits are measured at fair value. Regarding to the medical and health
insurance, industrial injury insurance, maternity insurance and other social insurances, housing fund and labor union expenditure and
personnel education that the Company paid for employees, the Company should recognize corresponding employees benefits payable
according to the appropriation basis and proportion as stipulated by relevant requirements and recognize the corresponding liabilities
and include these expenses in the profits or losses of the current period or recognized as respective assets costs.
(2) Accounting for post-employment benefits
During the accounting period in which an employee provides service, the amount payable calculated under defined contribution
scheme shall be recognized as a liability and recorded in profit and loss of the current period or in assets. In respect of the defined
benefit scheme, the Company shall use the projected unit credit method and attribute the welfare obligations calculated using the
formula stipulated by the defined benefit scheme to the service period of the employee, and record the obligation in the current profit
and loss or related assets cost.
(3) Accounting for termination benefits
The Company recognizes a liability and expenses in the current profit or loss for termination benefits at the earlier of the following
dates: when the Company can no longer withdraw the offer of those benefits; and when the Company recognizes costs for
restructuring involving the payment of termination costs.
(4) Accounting for other long-term employee benefits.
The Company provides other long-term employee benefits to its employees. For those falling within the scope of defined
contribution scheme, the Company shall account for them according to relevant requirements of the defined contribution scheme. In
addition, the Company recognizes and measures the net liabilities or net assets of the other long-term employee benefits according to
relevant requirements of the defined contribution scheme.
23. Accrual liability
The obligation related to contingencies is the current obligation assumed by the company, and performing this obligation may result
in an outflow of economic benefits, and this obligation can be determined as the estimated liabilities when the amount can be reliably
measured. The Company makes initial measurement in accordance with the best estimate for performing the related current
obligation, if the expenditure as needed has a continuous range, and the likelihood of occurrence of various results in this range is the
same, the best estimate is determined by the median value within the range; if a number of items are involved, the best estimate is
determined by the calculation of various possible outcomes and related probabilities.
At the balance sheet date, the book value of estimated liabilities should be rechecked, if there is conclusive evidence indicates that
this book value cannot truly reflect the current best estimate, and then the book value should be adjusted in accordance with the
current best estimate.
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24. Share-based payment
The Company's share-based payment includes the equity-settled share-based payments and the cash-settled share-based payments.
The equity-settled share-based payments in exchange for the provision of services by employees shall be measured by the fair value
of the employee’s equity instruments. When there is an active market, it is determined by the quotation in the active market; if there
is no active market, it is determined by the valuation technique, including the price used in the market transactions conducted by the
parties who are familiar with the situation and voluntarily make transactions, the current fair value of other financial instruments
substantially the same, the discount cash flow method, and the option pricing model.
At each balance sheet date, correct the stock options amount of estimated available rights according to the newest achieved follow-up
information such as the change in the number of available rights, the completion of performance indicators, etc., and confirm the cost
should be apportioned at each period on the basis of this. As for the option charges that span multiple accounting periods, it is
generally possible to apportion according to the proportion of the waiting period of this option in a certain accounting period
accounted for the entire waiting period.
25. Revenue
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Sales of goods
The Company shall ascertain the revenue incurred by selling goods in accordance with the received or receivable price stipulated in
the contract or agreement signed between the enterprise and the buyer unless the following conditions are met simultaneously: ①
the significant risks and rewards of ownership of the goods have been transferred to the buyer by the enterprise; ② the enterprise
retains neither continuous management right that usually keeps relation with the ownership nor effective control over the sold goods;
③the relevant amount of revenue can be measured in a reliable way; ④ relevant economic benefits may flow into the enterprise and
⑤ the relevant costs incurred or to be incurred can be measured in a reliable way.
Money collection for the contract or agreement use the mode of deferred, actually has the finacning features. The revenue of
commodity sales are recognized by the fair value of the money receivable on contract or agreement.
(2) Labor service providing
If an enterprise can, on the date of the balance sheet, reliably estimate the outcome of a transaction concerning the labor services it
provides, it shall recognize the revenue from providing services employing the percentage-of-completion method. The enterprise can
ascertain the schedule of completion (percentage-of-completion) under the transaction concerning the providing of labor services
based on calculation of completed works.
If an enterprise cannot, on the date of the balance sheet, measure the result of a transaction concerning the providing of labor service
in a reliable way, it shall be conducted in accordance with the following circumstances, respectively: ①if the cost of labor services
incurred is expected to be compensated, the revenue from the providing of labor services shall be recognized in accordance with the
amount of the cost of labor services incurred, and the cost of labor services shall be carried forward at the same amount; ②if the cost
of labor services incurred is not expected to compensate, the cost incurred should be included in the current profits and losses, and no
revenue from the providing of labor services may be recognized.
(3) Transition of asset use right
When economic benefits relating to transition of asset use right is likely to inflow into the Company and the relevant income can be
measured reliably, the Company shall recognize such income from transition of asset use right
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26. Government subsidy
(1) Determination basis and accounting treatment for government grants related to assets
Government grant obtained by the Company for the purpose of constructing or otherwise forming long term assets is recognised as
government grant related to assets which will be recognised as deferred income. Deferred income is averagely allocated against the
estimated service life of asset since the asset is available for use, and recorded in profit or loss for the current period.
(2) Determination basis and accounting treatment for government grants related to income
The government grants other than the government grants related to assets are recognized as government grants related to income.
Government grants related to income shall be treated as follows: those used to compensate relevant expenses or losses to be incurred
by the enterprise in subsequent periods are recognized as deferred income and recorded in profit and loss for the current period when
such expenses are recognized; and those used to compensate relevant expenses or losses that have been incurred by the enterprise are
recorded directly in profit or loss for the current period.
27. Deferred income tax asset / deferred income tax liability
(1) Where there is difference between the carrying amount of the assets or liabilities and its tax base, (as for an item that has not been
recognized as an asset or liability, if its tax base can be determined in light of the tax law, the tax base shall recognized as the
difference) the deferred income tax and deferred income tax liabilities shall be determined according to the applicable tax rate in
period of assets expected to recover or liability expected to pay off.
(2) The deferred income tax assets shall be recognized to the extent of the amount of the taxable income which it is most likely to
obtain and which can be deducted from the deductible temporary difference. On balance sheet date, if there have concrete evidence
of obtaining, in future period, enough taxable amounts to deduct the deductible temporary difference, the un-confirmed deferred
income tax assts in previous accounting period shall be recognized. If there has no enough taxable amounts, obtained in future period,
to deducted the deferred income tax assets, book value of the deferred income tax assets shall be kept in decreased.
(3) The taxable temporary differences related to the investments of subsidiary companies and associated enterprises shall recognized
as deferred income tax liability, unless the Company can control the time of the reverse of temporary differences and the temporary
differences are unlikely to be reversed in the expected future. As for the deductible temporary difference related to the investment of
the subsidiary companies and associated enterprises, deferred income tax assets shall be recognized while the temporary differences
are likely to be reversed in the expected future and it is likely to acquire any amount of taxable income tax that may be used for
making up the deductible temporary differences.
28. Leasing
(1) Accounting treatment for operating lease
Operating lease payments are recognized on a straight-line basis over the term of the relevant lease, and are either included in the
cost of related asset or charged to profit or loss for the period.
(2) Accounting treatment for finance lease
At the commencement of the lease term, the Group records the leased asset at an amount equal to the lower of the fair value of the
leased asset and the present value of the minimum lease payments. The difference between the recorded amounts is accounted for as
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unrecognized finance charge, using the effective interest method amortization during the lease term. Minimum lease payments
deducting unrecognized financing charges are listed as long-term payables.
29. Other important accounting policy and estimation
The company does not disclose other important accounting policies and accounting estimates.
30. Changes in important accounting policies and estimates
(1) Changes in important accounting policies
√ Applicable □ Not applicable
Content and reason of changes in
Approval procedure Note
accounting policies
The follow taxes (house duty, land use tax,
According to the Provisions of Accounting stamp tax, vehicle and vessel tax and
Treatments on VAT Cai Kuai [2016] No.22 resource tax etc.) arising from operation
issued by Ministry of Finance on 3 activities will listed under “taxes and
December 2016, relevant business surcharge” from”administrative expenses”
occurred since 1 May 2016 will implement since 1 May 2016. the taxes occurred befor
the new provision 1 May 2016 will not adjuste and
comparative data either
Tax and surcharge in consolidate profit statement increased 2,664,333.31 Yuan for the Year;
Administrative expenses in consolidate profit statement decreased 2,664,333.31 Yuan for the Year;
Tax and surcharge in parent company’s profit statement increased 1,293,535.18 Yuan for the Year;
Administrative expenses in parent company’s profit statement decreased 1,293,535.18 Yuan for the Year;
(2) Changes in important accounting estimates
□ Applicable √ Not applicable
VI. Taxes
1. Major tax and tax rate
Taxes Taxation basis Tax rate
VAT Domestic sales revenue 6%, 17%
Urban maintenance and construction tax Transfer tax payable 7%
Corporate income tax Taxable income 25%
Business tax Taxable income 5%
Educational surtax Transfer tax payable 3%
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Local educational surtax Transfer tax payable 2%, 1.5%
Property tax 70% of original value of the property 1.2%
Explain the different taxation entity of the enterprise income tax
Taxation entity Income tax rate
VII. Notes to main items in consolidated financial statement
1. Monetary fund
In RMB
Item Closing balance Opening balance
Cash on hand 235,039.12 382,669.21
Bank deposit 91,075,765.36 632,464,286.95
Other monetary fund 2,021,905.33 29,268,508.03
Total 93,332,709.81 662,115,464.19
Other explanation
Other monetary funds are bank acceptance deposits.
2. Note receivable
(1) Category
In RMB
Item Closing balance Opening balance
Bank acceptance bill 30,321,803.17 54,346,509.74
Commercial acceptance bill 22,341,297.72
Total 52,663,100.89 54,346,509.74
(2) Note receivable pledged at period-end
In RMB
Item Amount pledged
Bank acceptance bill 18,280,643.56
Total 18,280,643.56
(3) Note receivable which have endorsed and discount at period-end and has not expired on balance sheet
date
In RMB
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深圳中恒华发股份有限公司 2016 年年度报告全文
Item De-recognization amount at period-end Un de-recognization amount at period-end
Bank acceptance bill 32,575,746.11
Commercial acceptance bill 21,838,816.32
Total 54,414,562.43
3. Account receivable
(1) Category of account receivable
In RMB
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category Book
Proportio Accrual Proportio Accrual Book value
Amount Amount value Amount Amount
n ratio n ratio
Account receivable
with single
significant amount 7,649,78 7,649,78 7,649,7 7,649,789
5.00% 100.00% 6.22% 100.00%
and withdrawal bad 9.11 9.11 89.11 .11
debt provision
separately
Account receivable
with bad debt 139,832, 24,580.6 139,808,0 110,105 139,455.7 109,965,99
91.36% 0.02% 89.58% 0.13%
provision accrual by 638.85 5 58.20 ,447.88 4 2.14
portfolio
Accounts with single
significant amount
5,576,97 5,576,97 5,160,9 5,160,953
and bad debts 3.64% 100.00% 4.20% 100.00%
8.19 8.19 53.41 .41
provision accrued
individually
153,059, 13,251,3 139,808,0 122,916 12,950,19 109,965,99
Total 100.00% 100.00%
406.15 47.95 58.20 ,190.40 8.26 2.14
Account receivable with major single amount and withdrawal bad debt provision single at period-end:
√ Applicable □ Not applicable
In RMB
Account receivable (by Closing balance
units) Account receivable Bad debt reserve Accrual ratio Reasons
Shenzhen Portman
2,555,374.75 2,555,374.75 100.00% Un-recyclable
Bowling Club Co., Ltd.
Hongkong Haowei 1,870,887.18 1,870,887.18 100.00% Un-recyclable
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深圳中恒华发股份有限公司 2016 年年度报告全文
Industry Co. Ltd.
TCL ACE ELECTRIC
APPLIANCE 1,325,431.75 1,325,431.75 100.00% Un-recyclable
(HUIZHOU) CO., LTD.
Qingdao Haier Parts
1,225,326.15 1,225,326.15 100.00% Un-recyclable
Procurement Co., Ltd.
SKYWORTH
Multimedia (Shenzhen) 672,769.28 672,769.28 100.00% Un-recyclable
Co., Ltd.
Total 7,649,789.11 7,649,789.11 -- --
Account receivable with bad debt provision withdrawal by method of account age in portfolio:
√ Applicable □ Not applicable
In RMB
Closing balance
Account age
Account receivable Bad debt provision Accrual ratio
Sub-item of within one year
Subtotal of within one year 139,341,025.80
1-2 year 491,613.05 24,580.65 5.00%
Total 139,832,638.85 24,580.65
Explanation on portfolio basis:
Withdrawing bad bed provision by percentage of total accounts receivable outstanding in portfolio:
□ Applicable √ Not applicable
Withdrawing bad bed provision by other methods in portfolio:
Accounts with single significant amount and bad debts provision accrued individually at year-end
Debtor Book balance Bad debt Accrual ratio Reasons
Uncollectibl
Shenzhen Huixin Video Technology Co., Ltd. 381,168.96 381,168.96 100
e
Shenzhen Wandelai Digital Technology Co., Uncollectibl
351,813.70 351,813.70 100
Ltd. e
Uncollectibl
Shenzhen Dalong Electronic Co., Ltd. 344,700.00 344,700.00 100
e
Uncollectibl
Shenzhen Keya Electronic Co., Ltd. 332,337.76 332,337.76 100
e
Vietnam International Shipping International Uncollectibl
323,405.97 323,405.97 100
Co., Ltd. e
Uncollectibl
Shenzhen Qunping Electronic Co., Ltd. 304,542.95 304,542.95 100
e
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深圳中恒华发股份有限公司 2016 年年度报告全文
China Galaxy Electronics (Hong Kong) Co., Uncollectibl
288,261.17 288,261.17 100
Ltd. e
Uncollectibl
Dongguan Weite Electronic Co., Ltd. 274,399.80 274,399.80 100
e
Uncollectibl
Hong Kong New Century Electronics Co., Ltd. 207,409.40 207,409.40 100
e
Uncollectibl
Shenyang Beitai Electronic Co., Ltd. 203,304.02 203,304.02 100
e
Uncollectibl
Beijing Xinfang Weiye Technology Co., Ltd. 193,000.00 193,000.00 100
e
Uncollectibl
TCL Electronics (Hong Kong) Co., Ltd. 145,087.14 145,087.14 100
e
Uncollectibl
Huizhou TCL Xinte Electronics Co., Ltd. 142,707.14 142,707.14 100
e
Uncollectibl
SkyWorth – RGB Electronic Co., Ltd. 133,485.83 133,485.83 100
e
Uncollectibl
Other 1,951,354.35 1,951,354.35 100
e
Total 5,576,978.19 5,576,978.19
(2) Bad debt provision accrual, switch-back or taken back in the period
Bad debt provision accrual was 301,149.69 Yuan; the amount collected or switches back amounting to 0 Yuan.
Including major amount of bad debt provision that switch-back or taken back in the Period:
In RMB
Company Amount switch back or taken back Way
(3) Top five receivables collected by arrears party at ending balance
Total year-end balance of top five receivables by arrears party amounting to 120,720,685.90 Yuan, takes 78.88 percent of the total
account receivable at year-end, bad debt provision accrual correspondingly at year-end amounting as 1,225,326.15 Yuan.
4. Prepayments
(1) Prepayments listed by account age
In RMB
Closing balance Opening balance
Account age
Amount Proportion Amount Proportion
Within one year 12,760,284.18 97.59% 1,201,255.38 38.85%
106
深圳中恒华发股份有限公司 2016 年年度报告全文
1-2 year 17,494.85 0.13% 515,157.07 16.66%
2-3 year 297,942.90 2.28% 1,252,009.66 40.49%
Over 3 years 123,598.99 4.00%
Total 13,075,721.93 -- 3,092,021.10 --
Explanation on prepayments with over one year in age and reasons of un-settle:
Prepayments of 75,835.47 Yuan for Dongguan assembly electronics co., ltd., unsettlement for the materils are not delivery;
prepayment of 69,900.00Yuan for Shenzhen xinyuyue electronics co., ltd. unsettlement for the materils are not delivery
(2) Top 5 prepayments collected by objects at ending balance
Total year-end balance of top five advance payment by prepayment object amounted to 12,175,387.08 Yuan, takes 93.12% percent of
the total advance payment at year-end.
Other explanation:
Nil
5. Interest receivable
(1) Category
In RMB
Item Closing balance Opening balance
Wuhan Hengsheng Photoelectric Industry
1,838,752.40
Co., Ltd.
Total 1,838,752.40
6. Other account receivable
(1) Category of other account receivable
In RMB
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category Book
Proportio Accrual Proportio Accrual Book value
Amount Amount value Amount Amount
n ratio n ratio
Other account
receivable with
single significant 7,572,25 6,042,82 1,529,426 6,303,4 5,662,187
41.36% 79.80% 30.57% 89.83% 641,266.64
amount and 4.02 7.38 .64 54.02 .38
withdrawal bad debt
provision separately
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深圳中恒华发股份有限公司 2016 年年度报告全文
Other account
receivable with bad 2,384,04 57,893.1 2,326,151 8,844,2 173,338.0 8,670,881.4
13.02% 2.43% 42.90% 1.96%
debt provision 5.02 7 .85 19.47 4 3
accrual by portfolio
Other account
receivable with
single minor amount 8,351,89 8,273,10 5,469,3 5,469,385
45.62% 99.06% 78,798.40 26.53% 100.00%
but withdrawal single 8.56 0.16 85.44 .44
item bad debt
provision
18,308,1 14,373,8 3,934,376 20,617, 11,304,91 9,312,148.0
Total 100.00% 100.00%
97.60 20.71 .89 058.93 0.86 7
Other account receivable with major single amount and withdrawal bad debt provision single at period-end:
√ Applicable □ Not applicable
In RMB
Other account receivable Closing balance
(units) Other account receivable Bad debt provision Accrual ratio Accrual reason
Portman 4,021,734.22 4,021,734.22 100.00% Un-recyclable
Zhao Baomin 564,646.35 564,646.35 100.00% Un-recyclable
Shenzhen Jifang
1,268,800.00 380,640.00 30.00% Partially recyclable
Investment Co., Ltd.
Hebei Botou Court 520,021.00 520,021.00 100.00% Un-recyclable
Traffic accident
555,785.81 555,785.81 100.00% Un-recyclable
compensation
Wuwu Branch of
Shenzhen Dachong 641,266.64 Deposit without accrual
Industrial Co., Ltd.
Total 7,572,254.02 6,042,827.38 -- --
Other account receivable with bad debt provision withdrawal by method of account age in portfolio:
√ Applicable □ Not applicable
In RMB
Closing balance
Account age
Other account receivable Bad debt provision Accrual ratio
Sub-item of within one year
Subtotal of within one year 1,998,536.62 0.00%
1-2 year 158,753.40 7,937.67 5.00%
2-3 year 90,355.00 9,035.50 10.00%
Over three years 136,400.00 40,920.00 30.00%
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深圳中恒华发股份有限公司 2016 年年度报告全文
Total 2,384,045.02 57,893.17
Explanation on portfolio basis:
Withdrawing bad bed provision by percentage of total other accounts receivable outstanding in portfolio
□ Applicable √ Not applicable
Withdrawing bad bed provision by other methods in portfolio:
√ Applicable □ Not applicable
Other account receivable with single minor amount but withdrawal single item bad debt provision at year-end
Debtor Book balance Bad debt Accrual ratio (%) Reasons
Jiantao (Fogang) Laminates Co., Ltd. 465,528.10 465,528.10 100 Uncollectible
Shenzhen Lotus Island Restaurant Co., Ltd. 236,293.80 236,293.80 100 Uncollectible
Shenzhen Mingli Co., Ltd. 170,394.84 170,394.84 100 Uncollectible
China Great Wall Computer Shenzhen Company
168,436.33 168,436.33 100 Uncollectible
Limited
Shenzhen Hongya Electronic Co., Ltd. 156,390.00 156,390.00 100 Uncollectible
Shangxi Shengyi Technology Co., Ltd. 156,239.32 156,239.32 100 Uncollectible
Changchun Artificial Resin Co., Ltd. 147,486.96 147,486.96 100 Uncollectible
Shenzhen Xinlan Technology Co., Ltd. 138,038.00 138,038.00 100 Uncollectible
Fujian Zhangzhou Weili Electronic Enterprise
112,335.62 112,335.62 100 Uncollectible
Co., Ltd.
Chuangjing Studio 192,794.00 192,794.00 100 Uncollectible
Individuals borrow 1,799,073.12 1,799,073.12 100 Uncollectible
Labor union 332,402.55 332,402.55 100 Uncollectible
Staff canteen etc. 856,753.66 856,753.66 100 Uncollectible
Other 3,340,933.86 3,340,933.86 100 Uncollectible
Shenzhen Poly Property Group Co., Ltd. 78,798.40
Total 8,351,898.56 8,273,100.16 —— ——
(2) Bad debt provision accrual, switch-back or taken back in reporting period
Bad debt provision accrual was3,073,222.6 Yuan; the amount collected or switches back amounting to 4,312.80 Yuan.
Including major amount of bad debt provision that switch-back or taken back in the Period:
In RMB
Company Amount switch-back or taken back Way
(3) Classify according to nature
In RMB
Nature Ending book balance Opening book balance
Margin and deposit 1,793,485.04 1,050,465.04
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深圳中恒华发股份有限公司 2016 年年度报告全文
Borrow money 2,719,549.04 2,230,773.98
Intercourse funds 7,503,053.91 8,555,223.82
Rent receivable 6,195,824.01 8,780,596.09
Other 96,285.60
Total 18,308,197.60 20,617,058.93
(4) Top 5 other receivables collected by arrears party at ending balance
In RMB
Proportion in total
Ending balance of
Company Nature Ending balance Account age other receivables at
bad debt provision
year-end
Portman Lease receivable 4,021,734.22 Over three years 22.26% 4,021,734.22
Shenzhen Jifang Within 1 year and
Lease receivable 1,268,800.00 7.02% 380,640.00
Investment Co., Ltd. 1-2 year
Wuhan Power
Supply Company of
Hubei Provincial Electricity fees 800,000.00 Within 1 year 4.43%
Electric Power Co.,
Ltd.
Fujian Jielian
Margin 641,266.64 Within 1 year 3.55%
Electronic Co., Ltd.
Wuwu Branch of
Within 1 year and
Shenzhen Dachong Deposit 564,646.35 3.13% 564,646.35
1-2 year
Industrial Co., Ltd.
Total -- 7,296,447.21 -- 40.39% 4,967,020.57
7. Inventory
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Category of inventory
In RMB
Closing balance Opening balance
Item Provision for Provision for
Book balance Book value Book balance Book value
price fall-down price fall-down
Raw materials 29,871,068.31 1,089,943.56 28,781,124.75 17,302,057.71 1,179,084.70 16,122,973.01
110
深圳中恒华发股份有限公司 2016 年年度报告全文
Goods in process 307,753.41 307,753.41
Inventory goods 15,940,570.96 914,927.55 15,025,643.41 9,312,241.13 630,705.46 8,681,535.67
Homemade
semi-finished 2,757,682.20 41,816.29 2,715,865.91 1,783,967.55 33,070.70 1,750,896.85
products
Low priced and
easily worn 404,377.39 24,626.66 379,750.73 320,542.85 51,575.88 268,966.97
articles
Total 48,973,698.86 2,071,314.06 46,902,384.80 29,026,562.65 1,894,436.74 27,132,125.91
Does the Company comply with the disclosure requirement of “Information Disclosure Guidelines of Shenzhen Stock Exchange
No.4 – Listed Companies Engaged in Seed Industry and Planting Business” or not
No
(2) Provision for price fall-down
In RMB
Current increased Current decreased
Items Opening balance Switch back or Closing balance
Accrual Other Other
Written-off
Raw materials 1,179,084.70 98,563.06 187,704.20 1,089,943.56
Inventory goods 630,705.46 284,222.09 914,927.55
Homemade
semi-finished 33,070.70 8,745.59 41,816.29
products
Low priced and
easily worn 51,575.88 17,131.38 44,080.60 24,626.66
articles
Total 1,894,436.74 408,662.12 231,784.80 2,071,314.06
(3) Explanation on capitalization of borrowing costs in ending balance of inventory
Nil
(4) Assets completed without settle resulted by construction contract at period-end
In RMB
Item Amount
Other explanation:
Nil
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深圳中恒华发股份有限公司 2016 年年度报告全文
8. Classified as assets held for sale
In RMB
Expected disposal
Item Ending book value Fair value Expected disposal time
expenses
Gongming Huafa
0.00
Electronic City
Total 0.00 --
Other explanation:
On August 26, 2015, the Company signed the “Cooperation Agreement on Urban Renewal Project of Update Units at Huafa
Industrial Park, Gongming Street, Guangming New District, Shenzhen”, “Agreement on the Housing Acquisition and Removal
Compensation and Settlement”, and “Cooperative Operation Contract of Renovation Project at Huafa Industrial Park, Gongming
Street, Guangming New District” with Shenzhen Hwafa and Wuhan Zhongheng New Technology Industry Group Co., Ltd.
(hereinafter referred to as "Zhongheng Group"), Shenzhen Vanke Real Estate Co., Ltd. and Shenzhen Guangming Vanke Real Estate
Development Co., Ltd., according to the agreement of the Company and Zhongheng Group, the Company has authorized Zhongheng
Group to proceed with this project cooperation on behalf of the Company, the Company could obtain the consideration for
demolition compensation of 500 million yuan and the commercial area of 100,000 square meters; and after the completion of
liquidation and settlement of the target project, the third party intermediary appointed by Zhongheng Group made distribution of
earnings for the common benefit liquidation of the target project, if the common benefits had profits, the Company could share in the
proportion of 50.50% of the interests of the occupied land, if there was a loss in the common benefits, the Company did not have to
bear. This project was approved to shift to liquidation of fixed assets by the company because it was in the state of closure due to the
litigation with Vanke.
9. Non-current assets due within one year
In RMB
Item Closing balance Opening balance
Decoration fee 12,191.49
Total 12,191.49
Other explanation:
Decoration fee will amortized in one year, and transfer to non-current assets due within one year
10. Investment real estate
(1) Investment real estate measured at cost
√ Applicable □ Not applicable
In RMB
Item House and building Land use right Construction in process Total
I. Original book value
1.Opening balance 107,661,686.94 107,661,686.94
112
深圳中恒华发股份有限公司 2016 年年度报告全文
2.Current increased 26,000,000.00 26,000,000.00
(1) outsourcing
(2) inventory\fixed
assets\construction in 26,000,000.00 26,000,000.00
process transfer-in
(3) increased by
combination
3.Current decreased
(1) disposal
(2) other
transfer-out
4.Closing balance 133,661,686.94 133,661,686.94
II. Accumulated
depreciation and
accumulated
amortization
1.Opening balance 77,641,780.28 77,641,780.28
2.Current increased 1,874,681.64 1,874,681.64
(1) accrual or
1,874,681.64 1,874,681.64
amortization
3.Current decreased
(1) disposal
(2) other
transfer-out
4.Closing balance 79,516,461.92 79,516,461.92
III. Depreciation reserves
1.Opening balance
2.Current increased
(1) accrual
3. Current decreased
(1) disposal
113
深圳中恒华发股份有限公司 2016 年年度报告全文
(2) other
transfer-out
4.Closing balance
IV. Book value
1. Ending Book
54,145,225.02 54,145,225.02
value
2. Opening Book
30,019,906.66 30,019,906.66
value
(2) Investment real estate measure on fair value
□ Applicable √ Not applicable
11. Fixed assets
(1) Fixed assets
In RMB
House and Machine Transportatio Office Instrument Tool Mold
Items Total
building equipment n equipment equipment equipment equipment equipment
I. Original
book value:
1.Opening 91,554,098.8 76,468,545.6 11,343,547.0 195,307,276.
4,056,422.87 5,594,918.62 2,754,225.58 3,535,518.29
balance 5 1 7 89
2.Current
54,700.00 771,067.08 1,471,730.77 1,334,434.13 39,042.74 853,403.87 1,932,889.76 6,457,268.35
increased
54,700.00 771,067.08 1,471,730.77 1,334,434.13 39,042.74 853,403.87 1,932,889.76 6,457,268.35
(1)purchasing
(2)constructi
on in
progress
transfer-in
(3) increased
by
combination
3.Current 26,000,000.0 27,225,750.2
170,413.00 315,000.00 28,410.50 37,606.83 4,716.45 669,603.44
decreased 0 2
114
深圳中恒华发股份有限公司 2016 年年度报告全文
(1) disposal
170,413.00 315,000.00 28,410.50 37,606.83 4,716.45 669,603.44 1,225,750.22
or scrapping
(2) transfer-in
26,000,000.0 26,000,000.0
investment
0 0
properties
4.Closing 65,608,798.8 77,069,199.6 12,606,833.3 174,538,795.
5,213,153.64 6,900,942.25 2,755,661.49 4,384,205.71
balance 5 9 9 02
II.
Accumulativ
e
depreciation
1.Opening 10,973,812.0 52,887,651.0 84,699,851.3
2,948,087.90 5,010,770.08 2,364,796.62 2,166,482.87 8,348,250.81
balance 6 5 9
2.Current
2,567,854.86 4,823,933.68 491,124.18 212,548.56 95,166.82 404,258.51 1,233,523.55 9,828,410.16
increased
(1) accrual 2,567,854.86 4,823,933.68 491,124.18 212,548.56 95,166.82 404,258.51 1,233,523.55 9,828,410.16
3.Current
651,300.36 153,281.70 276,571.32 25,569.45 33,846.14 4,244.81 389,359.77 1,534,173.55
decreased
(1) disposal
153,281.70 276,571.32 25,569.45 33,846.14 4,244.81 389,359.77 882,873.19
or scrapping
(2) transfer-in
investment 651,300.36 651,300.36
properties
4.Closing 12,890,366.5 57,558,303.0 92,994,088.0
3,162,640.76 5,197,749.19 2,426,117.30 2,566,496.57 9,192,414.59
balance 6 3 0
III.
Depreciation
reserves
1.Opening
balance
2.Current
increased
(1) accrual
3.Current
decreased
(1) disposal
or scrapping
115
深圳中恒华发股份有限公司 2016 年年度报告全文
4.Closing
balance
IV. Book
value
1. Ending 52,718,432.2 19,510,896.6 81,544,707.0
2,050,512.88 1,703,193.06 329,544.19 1,817,709.14 3,414,418.80
Book value 9 6 2
2. Opening 80,580,286.7 23,580,894.5 110,607,425.
1,108,334.97 584,148.54 389,428.96 1,369,035.42 2,995,296.26
Book value 9 6 50
(2) Fixed assets leasing-out by operational lease
In RMB
Item Ending book value
House and building 957,878.33
12. Construction in progress
(1) Construction in progress
In RMB
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Transformation
project of Huafa 654,356.00 654,356.00 654,356.00 654,356.00
Building
Total 654,356.00 654,356.00 654,356.00 654,356.00
13. Disposal of fixed assets
In RMB
Item Closing balance Opening balance
Gongming Huafa Electronic City 92,857,471.69
Total 92,857,471.69
Other explanation:
Transfer to diposal of fixed assets from assets available for sale
116
深圳中恒华发股份有限公司 2016 年年度报告全文
14. Intangible assets
(1) Intangible assets
In RMB
Non-patented
Item Land use right Patent right Computer software Total
technology
I. Original book
value
1.Opening
55,187,826.36 661,878.97 55,849,705.33
balance
2.Current
increased
(1) purchasing
(2) internal
R&D
(3) increased by
combination
3.Current
decreased
(1) disposal
4.Closing
55,187,826.36 661,878.97 55,849,705.33
balance
II. Accumulated
amortization
1.Opening
9,125,026.65 352,288.19 9,477,314.84
balance
2.Current
1,444,408.80 49,885.92 1,494,294.72
increased
(1) accrual 1,444,408.80 49,885.92 1,494,294.72
3.Current
decreased
(1) disposal
4.Closing 10,569,435.45 402,174.11 10,971,609.56
117
深圳中恒华发股份有限公司 2016 年年度报告全文
balance
III. Depreciation
reserves
1.Opening
balance
2.Current
increased
(1) accrual
3.Current
decreased
(1) disposal
4.Closing
balance
IV. Book value
1. Ending Book
44,618,390.91 259,704.86 44,878,095.77
value
2. Opening
46,062,799.71 309,590.78 46,372,390.49
Book value
The proportion of intangible assets form by internal R&D in total book value of intangible assets at period-end
15. Long-term deferred expenditure
In RMB
Item Opening balance Current increased Amortized in Period Other decreased Closing balance
Golf membership fee 241,666.63 50,000.04 191,666.59
Decoration fee 33,091.53 20,900.04 12,191.49
Total 274,758.16 70,900.08 12,191.49 191,666.59
Other explanation
Other decreased refers to the non-current assets due within one year
16. Deferred income tax asset /deferred income tax liability
(1) Deferred income tax assets un-offset
In RMB
Item Closing balance Opening balance
118
深圳中恒华发股份有限公司 2016 年年度报告全文
Deductible temporary Deferred income tax Deductible temporary Deferred income tax
differences asset differences asset
Provision for impairment
26,543,004.31 6,635,751.08 22,996,373.35 5,749,168.34
of assets
Estimated liabilities 2,604,411.81 651,102.95 2,604,411.81 651,102.95
Other 4,754,489.08 1,188,622.27
Total 33,901,905.20 8,475,476.30 25,600,785.16 6,400,271.29
(2) Amount of deferred income tax asset and deferred income tax liability after trade-off
In RMB
Ending balance of Trade-off between the Opening balance of
Trade-off between the
deferred income tax deferred income tax deferred income tax
Item deferred income tax
assets or liabilities after assets and liabilities at assets or liabilities after
assets and liabilities
off-set period-begin off-set
Deferred income tax
8,475,476.30 6,400,271.29
asset
(3) Deferred income tax asset without confirmed
In RMB
Item Closing balance Opening balance
Deductible loss 1,006,234.22 1,006,234.22
Provision for impairment of assets 3,153,478.41 3,153,172.51
Total 4,159,712.63 4,159,406.73
(4) Deductible losses of deferred income tax asset without confirmed will expired in later year
In RMB
Year Closing amount Opening amount Note
2017 480,885.89 480,885.89
2018 525,348.33 525,348.33
Total 1,006,234.22 1,006,234.22 --
Other explanation:
Nil
119
深圳中恒华发股份有限公司 2016 年年度报告全文
17. Short-term borrowing
(1) Category of short-term borrowing
In RMB
Item Closing balance Opening balance
Pledge loan 6,500,000.00 21,000,000.00
Guaranteed loan 20,000,000.00 19,600,000.00
Collateral loan 54,710,467.81 78,879,107.41
Mortgage borrowing 100,000,000.00
Total 181,210,467.81 119,479,107.41
Explanation on category of short-term borrowing:
Nil
18. Note payable
In RMB
Category Closing balance Opening balance
Commercial acceptance bill 16,714,584.01 53,614,420.20
Total 16,714,584.01 53,614,420.20
Totally 0 Yuan due note payable are paid at period-end
19. Account payable
(1) Account payable
In RMB
Item Closing balance Opening balance
Within one year (one year included) 61,929,564.68 35,930,211.26
Over 1 year 11,784,860.09 18,311,444.60
Total 73,714,424.77 54,241,655.86
(2) Major account payable over one year
In RMB
Item Closing balance Reasons of un-paid or carry-over
Shenzhen Yuehai Global Logistics Co.,
2,858,885.97 Unsettled
Ltd.
LG 1,906,267.50 Unsettled
120
深圳中恒华发股份有限公司 2016 年年度报告全文
Dongjin Electronics (Nanjing) Plasma Co.,
617,963.45 Unsettled
Ltd.
Total 5,383,116.92 --
Other explanation:
Nil
20. Account received in advance
(1) Account received in advance
In RMB
Item Closing balance Opening balance
Within one year (one year included) 1,067.00 1,140,236.50
Over 1 year 47,779.60 7,233.02
Total 48,846.60 1,147,469.52
21. Salary payable
(1) Salary payable
In RMB
Increase during the Decrease during this
Item Opening balance Closing balance
period period
I. Short-term compensation 4,736,709.29 57,878,359.22 58,067,443.47 4,547,625.04
II. Post-employment
welfare- defined -5,093.82 4,639,594.05 4,639,594.05 -5,093.82
contribution plans
Total 4,731,615.47 62,517,953.27 62,707,037.52 4,542,531.22
(2) Short-term compensation
In RMB
Increase during the Decrease during this
Item Opening balance Closing balance
period period
1. Wages, bonuses, allowances
3,822,231.19 51,083,877.26 51,363,446.04 3,542,662.41
andsubsidies
2. Welfare for workers
4,580,840.82 4,580,840.82
and staff
3. Social insurance 23,041.98 1,707,696.19 1,707,696.19 23,041.98
121
深圳中恒华发股份有限公司 2016 年年度报告全文
Including: Medical
23,041.98 1,435,272.63 1,435,272.63 23,041.98
insurance
Work injury
141,971.93 141,971.93
insurance
Maternity
130,451.63 130,451.63
insurance
4. Housing accumulation
24,310.00 405,280.42 405,280.42 24,310.00
fund
5. Labor union
expenditure and
867,126.12 100,664.53 10,180.00 957,610.65
personnel education
expense
Total 4,736,709.29 57,878,359.22 58,067,443.47 4,547,625.04
(3) Defined contribution plans
In RMB
Increase during the Decrease during this
Item Opening balance Closing balance
period period
1. Basic endowment
-5,093.82 4,439,964.74 4,439,964.74 -5,093.82
insurance
2. Unemployment
199,629.31 199,629.31
insurance
Total -5,093.82 4,639,594.05 4,639,594.05 -5,093.82
Other explanation:
Nil
22. Tax payable
In RMB
Item Closing balance Opening balance
Value-added tax 5,921,066.33 3,113,697.74
Enterprise income tax 8,460,507.90 12,546,524.05
Individual income tax 72,577.79 35,377.25
Urban maintenance and construction tax 444,600.28 39,559.71
Business tax 958.14 1,252,259.98
House property tax 763,249.59 526,275.00
Land use tax 324,212.71 323,677.55
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深圳中恒华发股份有限公司 2016 年年度报告全文
Education surcharge 191,311.22 15,747.38
Local education surcharge 101,317.51 13,485.06
Dike fee 1,149.33 1,149.33
Stamp tax 20,009.90 19,902.00
Disposal fund of waste electrical products 467,070.00 -19,670.00
Total 16,768,030.70 17,867,985.05
Other explanation:
23. Interest payable
In RMB
Item Closing balance Opening balance
Interest payable of short-term loans 123,641.69
Total 123,641.69
Interest over due without paid:
In RMB
Borrower Overdue amount Reasons
Other explanation:
24. Other payable
(1) Classification of other payable according to nature of account
In RMB
Item Closing balance Opening balance
Margin and deposit 5,957,390.38 10,061,229.53
Lease management fee 2,003,231.87 1,698,564.47
Payables on equipment 332,322.49
Intercourse funds 5,330,161.96 18,190,118.93
Sale and repair 1,302,101.54 837,903.65
Other 2,457,149.41 1,545,559.25
Total 17,050,035.16 32,665,698.32
(2) Significant other payable with over one year age
In RMB
Item Closing balance Reasons of un-paid or carry-over
Shenzhen Huayongxing Environmental 1,000,000.00 Deposit
123
深圳中恒华发股份有限公司 2016 年年度报告全文
Protection Technology Co., Ltd.
Linghang Technology (Shenzhen) Co., Ltd. 656,345.28 Unsettled
Shenzhen SED Property Development Co.,
634,723.75 Unsettled
Ltd.
Shenzhen Tongxing Electronics Co., Ltd. 578,259.83 Unsettled
Shenzhen Yongdasheng Investment
558,970.00 Deposit
Development Co., Ltd.
Total 3,428,298.86 --
Other explanation
25. Long-term loans
(1) Classification of long-term loans
In RMB
Item Closing balance Opening balance
Mortgage loan 554,700,000.00
Total 554,700,000.00
Explanation on category of long-term loans:
Nil
Other explanation, including interest rate section:
Nil
26. Accrued liabilities
In RMB
Item Closing balance Opening balance Causes
Pending action 2,604,411.81 2,604,411.81 Business and labor disputes
Total 2,604,411.81 2,604,411.81 --
Other explanations, including important assumptions and estimation about important estimated liabilities:
(1) On November 24, 2015, Shenzhen Intermediate People's Court adjudicated the dispute case that Shaanxi Linghua complained
about the Company’s work contract ((2013) SZFSZZ No. 1491): Shaanxi Linghua should pay the damages for breach of contract of
1,778,081.05 yuan to the Company within 10 days from the date the adjudication takes effect, Shaanxi Linghua should pay the
remaining payment of 869,458.96 yuan to the Company within 10 days from the date the adjudication takes effect, and compensate
for the loss of interest. The Company applied for retrial to Guangdong Higher People's Court. On December 3, 2016, Guangdong
Higher People's Court made a ruling on the application ((2016) YMSNo. 3280), and rejected the Company’s retrial application. Up to
December 31, 2016, the Company accrued the litigation cost of RMB 2,360,203.26 and recognized it as an estimated liability. As it
has not yet been implemented or determined, it shall be written back in the actual execution.
(2) According to the Enforcement Notice ( (2008) SFFZZ No.522-529) of Shenzhen Intermediate People's Court, Shenzhen Labor
Dispute Arbitration Commission issued SLZC [2007] No. 1069-1077, No. 1079, No. 1081, and No. 1085-1087 arbitration awards for
124
深圳中恒华发股份有限公司 2016 年年度报告全文
the labor dispute case of Cai Yaoqiang and other thirteen people, which has taken legal effect. According to the Basic Information
Credit Report of Enterprises, the Company has total unexecuted labor dispute subject of RMB 38,386.00, and the Company
recognizes it as the estimated liability.
27. Share capital
In RMB
Changes in the Period (+,-)
Opening Shares transfer Closing
Issuing new
balance Bonus shares from public Other Subtotal balance
shares
reserves
Total shares 283,161,227.00 283,161,227.00
Other explanation:
Ended as 31 December 2016, the shares of the Company held by controlling shareholder has 116,100,000 shares in status of pledge,
taking 41% of the total share capital; pmortgagee is China Merchants Securities Assets Manaegment Co., Ltd. Shares in judicial
feeze amounted as 116,489,894 shares.
28. Capital surplus
In RMB
Increase during the Decrease during this
Item Opening balance Closing balance
period period
Capital premium (equity
96,501,903.02 96,501,903.02
premium)
Other capital surplus 49,781,739.88 303,628.60 50,085,368.48
Total 146,283,642.90 303,628.60 146,587,271.50
Other explanation, including changes and reasons of changes:
Due to the income from sales of odd lots in the Period
29. Surplus reserves
In RMB
Increase during the Decrease during this
Item Opening balance Closing balance
period period
Statutory surplus
21,322,617.25 21,322,617.25
reserves
Discretionary surplus
56,068,976.00 56,068,976.00
reserve
Total 77,391,593.25 77,391,593.25
Other explanation, including changes and reasons for changes:
125
深圳中恒华发股份有限公司 2016 年年度报告全文
Nil
30. Retained profit
In RMB
Item This period Last period
Retained profit at the end of the previous period
-195,429,900.95 -188,698,387.84
before adjustment
Total undistributed profit at the beginning of
2,530,667.50 0.00
adjustment period (+,-)
Retained profit at period-begin after adjustment -192,899,233.45 -188,698,387.84
Add: net profit attributable to owners of the parent
5,457,710.33 -6,731,513.11
company
Retained profit at period-end -187,441,523.12 -195,429,900.95
Details about adjusting the retained profits at the beginning of the period:
1) The retroactive adjustments to Accounting Standards for Business Enterprises and its relevant new regulations affect the retained
profits at the beginning of the period amounting to 0 Yuan.
2) The changes in accounting policies affect the retained profits at the beginning of the period amounting to 0 Yuan.
3) The major accounting error correction affects the retained profits at the beginning of the period amounting to 2,530,667.50 Yuan
4) Merge scope changes caused by the same control affect the retained profits at the beginning of the period amounting to 0 Yuan.
5) Other adjustments affect the retained profits at the beginning of the period amounting to 0 Yuan
31. Operating income and cost
In RMB
Current Period Last Period
Item
Income Cost Income Cost
Main business 570,057,375.54 524,715,312.30 440,956,342.98 407,404,193.78
Other business 49,110,395.20 10,021,300.72 58,499,438.13 10,596,873.30
Total 619,167,770.74 534,736,613.02 499,455,781.11 418,001,067.08
32. Tax and surcharges
In RMB
Item Current Period Last Period
City maintenance and construction tax 1,237,422.94 1,697,868.43
Educational surtax 532,299.17 836,317.19
House property tax 2,379,135.20 442,258.57
Land use tax 651,551.53 239,994.10
Vehicle use tax 1,050.62
126
深圳中恒华发股份有限公司 2016 年年度报告全文
Stamp tax 314,848.62
Local education development fee 315,891.10 376,455.72
Business tax 705,358.40 2,057,554.12
Other 118,646.63
Total 6,137,557.58 5,769,094.76
Other explanation:
33. Sales expenses
In RMB
Item Current Period Last Period
Employee compensation 3,961,051.20 4,353,576.68
Transportation fee 3,734,511.93 2,972,576.15
Commodity inspection fee 835,099.19 547,057.32
Customs fee 73,375.06 151,446.37
Commodity loss 577,556.46 548,612.19
After sales service fee 1,750,857.26 1,824,961.06
Entertainment expense 134,299.80 261,660.20
Other 348,519.92 767,815.23
Total 11,415,270.82 11,427,705.20
Other explanation:
Nil
34. Administrative expenses
In RMB
Item Current Period Last Period
Salary 10,789,526.57 7,072,225.28
Depreciation charge 2,727,784.79 5,150,256.15
Social insurance premium 6,752,570.66 7,179,586.17
Entertainment expense 2,789,553.98 2,550,204.97
Taxes and surcharges 1,053,920.89 3,539,287.24
Employee benefits 1,582,132.90 1,504,949.44
Travel expenses 3,242,531.84 1,797,446.40
Amortization of intangible assets 1,494,294.72 1,494,294.72
Transportation fee 1,564,024.45 1,277,700.01
127
深圳中恒华发股份有限公司 2016 年年度报告全文
Consulting fee 5,469,220.77 930,988.04
Security fee 1,103,220.31 973,495.28
Repairs fee 1,380,527.36 1,157,265.00
Audit fee 734,235.85 767,169.81
Office allowance 2,282,069.51 3,969,741.51
Communication fee 364,141.24 419,908.23
Amortization of low cost and short lived
540,722.73 314,699.85
articles
Securities information disclosure fee 404,595.80 725,725.60
Litigation fee 460,211.00 28,478.00
Lease fee 4,499,772.41 953,438.81
Employee education funds 79,339.92 93,459.92
Water and electricity fee 101,827.25 75,728.54
Other expenses 845,270.65 715,359.16
Total 50,261,495.60 42,691,408.13
Other explanation:
35. Financial expenses
In RMB
Item Current Period Last Period
Interest costs 9,256,353.17 53,144,384.74
Less: interest income 865,609.05 2,028,034.77
Exchange loss 2,967,605.72 4,115,403.91
Less: exchange gains 8,734,892.51 9,137,919.35
Handing expense 427,320.01 337,361.99
Asset management fee 1,960,000.00 1,960,000.00
Other expense 2,120.00 2,520.00
Total 5,012,897.34 48,393,716.52
Other explanation:
Nil
36. Losses on assets impairment
In RMB
Item Current Period Last Period
128
深圳中恒华发股份有限公司 2016 年年度报告全文
I. Bad debt losses 3,370,059.54 1,346,128.24
II. Inventory falling price loss 176,877.32
Total 3,546,936.86 1,346,128.24
Other explanation:
Nil
37. Gains on investment
In RMB
Item Current Period Last Period
Investment income from disposal of long-term
643.49
equity investment
Other 333,974.06 25,246,527.78
Total 333,974.06 25,247,171.27
Other explanation:
Nil
38. Non-operating income
In RMB
Amount reckoned in current
Item Current Period Last Period
non-recurring gains/losses
Total income from disposal of
122,730.30 453,321.89 122,730.30
non-current assets
Including: gains from disposal
122,730.30 453,321.89 122,730.30
of fixed assets
Receive donations 4,000.00 4,000.00
Government subsidy 1,419,888.89 1,691,800.00 1,419,888.89
Unable to pay 379,187.99 623,987.65 379,187.99
Penalty revenue 3,526,305.00 377,580.00 3,526,305.00
Fine income 81,319.60 81,319.60
Other 17,159.45
Total 5,533,431.78 3,163,848.99 5,533,431.78
Government subsidy reckoned into current gains/losses:
In RMB
Subsidy
The special Assets-relate
Issuing Offering impact Amount in Amount in
Item Nature subsidy d/income-rela
subject causes current the Period last period
(Y/N) ted
gains/losses
129
深圳中恒华发股份有限公司 2016 年年度报告全文
(Y/N)
Subsidy
Human obtained for
Resources & conforms
Social with the local
Stabilization Security support Income-relate
Reward N Y 183,500.00 221,800.00
subsidy Bureau of policy for d
Caidian investment
District, incentive to
Wuhan encourage
investment
Subsidy
obtained for
conforms
Commercial
with the local
Bureau of
support Income-relate
Export bonus Caidian Reward N Y 20,000.00 1,470,000.00
policy for d
District,
investment
Wuhan
incentive to
encourage
investment
Subsidy
obtained for
Economic & conforms
Information with the local
Enterprise
Bureau of support Income-relate
development Subsidy N Y 100,000.00
Caidian policy for d
subsidy
District, investment
Wuhan incentive to
encourage
investment
Subsidy
obtained for
conforms
Excellent Caidian with the local
enterprise Bureau of support Income-relate
Reward N Y 200,000.00
award for Finance, policy for d
year of 2015 Wuhan investment
incentive to
encourage
investment
Enterprise Caidian Subsidy for Income-relate
Subsidy N Y 863,469.00
development Bureau of R&D, d
130
深圳中恒华发股份有限公司 2016 年年度报告全文
fund Finance, technical
(manufacturi Wuhan innovation
ng project of and
home reforming
appliance
parts )
Subsidy
obtained for
conforms
Office of with the local
Water
Water support Income-relate
conservation Reward N Y 10,000.00
Conservation policy for d
subsidy
of Wuhan investment
incentive to
encourage
investment
Subsidy
obtained for
Shenzhen
conforms
Municipal
with the local
Maternity Bureau of
support Income-relate
insurance Human Subsidy N Y 42,919.89
policy for d
benefits Resources &
investment
Social
incentive to
Security
encourage
investment
Total -- -- -- -- -- 1,419,888.89 1,691,800.00 --
Other explanation:
Nil
39. Non-operating expediture
In RMB
Amount included in current
Item Current Period Last Period
non-recurring profits or losses
Total losses on disposal of
40,598.22 4,270.45 40,598.22
non-current assets
Including: loss on disposal of
40,598.22 4,270.45 40,598.22
fixed assets
External donation 50,000.00
131
深圳中恒华发股份有限公司 2016 年年度报告全文
Penalty expenditure 401,518.25 263,228.96 401,518.25
Loss of creditor's rights transfer 4,754,489.08 4,754,489.08
Other expenses 44,787.59 15,348.71 44,787.59
Total 5,241,393.14 332,848.12 5,241,393.14
Other explanation:
Nil
40. Income tax expenses
(1) Statement of income tax expense
In RMB
Item Current Period Last Period
Current income tax expense 5,300,506.90 4,254,015.63
Deferred income tax expense -2,075,205.01 -148,336.70
Total 3,225,301.89 4,105,678.93
(2) Adjustment on accounting profit and income tax expenses
In RMB
Item Current Period
Total profit 8,683,012.22
Income tax based on statutory/applicable rate 2,170,753.06
Cost, expenses and loss which are not deductible 3,129,753.84
Impact on deductible temporary differences or losses deductible
-2,075,205.01
which was un-recognized as deferred income tax assets
Income tax expense 3,225,301.89
Other explanation
41. Items of statement of cash flow
(1) Other cash received in relation to operation activities
In RMB
Item Current Period Last Period
Unit intercourse account 58,857,368.87 281,084,189.31
Collection management fee and utilities
887,774.50 9,551,004.25
etc.
132
深圳中恒华发股份有限公司 2016 年年度报告全文
Repayment from employees 2,519,419.93 3,275,328.00
Margin, deposit 1,195,207.00 2,282,518.00
Interest income 198,375.93 189,282.37
Refund 1,484,810.16
Claim deduction etc. 70,996.80
Government grants 1,419,888.89
Receive grant 4,000.00
Capital occupation fee 1,838,752.40
Total 68,476,594.48 296,382,321.93
Explanation on other cash received in relation to operation activities:
(2) Other cash paid in relation to operation activities
In RMB
Item Current Period Last Period
Unit intercourse account 67,264,966.80 254,308,002.31
Advances to employees 3,149,396.42 5,589,087.29
Litigation fee 489,061.00 28,478.00
Margin, deposit 1,665,134.00 3,943,642.37
Entertainment expense 2,974,661.79 2,922,346.11
Water and electricity 101,827.25 18,973,213.75
Travel expenses 3,356,481.54 1,924,876.24
Transportation fee 3,918,442.17 2,972,576.15
Transportation fee 1,632,669.14 1,133,172.27
Repairs 1,419,253.95 982,930.48
Audit fees, consulting fees 9,261,709.50 2,453,883.45
Security 1,212,962.31 973,495.28
Financial institutions handling fee 426,098.13 2,299,846.99
Office expenses 2,171,388.26 3,724,297.73
Communication fee 381,223.14 434,204.60
Lease fee 4,507,704.41 1,244,881.70
Other 1,410,801.99 1,132,757.53
Refund 1,114,064.48
Asset management fee 1,960,000.00
Commodity inspection fee 812,042.67
133
深圳中恒华发股份有限公司 2016 年年度报告全文
After sales service fee 1,447,902.00
Fine 401,518.25
Securities information disclosure fee 404,595.80
Total 111,483,905.00 305,041,692.25
Explanation on other cash paid in relation to operation activities:
(3) Cash received from other investment activities
In RMB
Item Current Period Last Period
The balance of equity money received
from subsidiary disposal higher than the 899,643.49
monetary fund held on disposal date
Total 899,643.49
Explanation on cash received from other investment activities:
(4) Other cash received in relation to financing activities
In RMB
Item Current Period Last Period
Recover principal 1,000,000,000.00
Receipt of funds occupation fee, income 62,033,333.35
Total 1,062,033,333.35
Explanation on other cash received in relation to financing activities:
(5) Other cash paid related with financing activities
In RMB
Item Current Period Last Period
Principal payment 500,000,000.00
Total 500,000,000.00
Explanation on other cash paid related with financing activities:
42. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB
Supplementary information This Period Last Period
134
深圳中恒华发股份有限公司 2016 年年度报告全文
1. Net profit adjusted to cash flow of
-- --
operation activities:
Net profit 5,457,710.33 -4,200,845.61
Add: Assets impairment provision 3,546,936.86 1,346,128.24
Depreciation of fixed assets, consumption of
oil assets and depreciation of productive 11,051,791.44 15,327,915.18
biology assets
Amortization of intangible assets 1,494,294.72 1,494,294.72
Amortization of long-term deferred expenses 70,900.08 70,900.08
Loss from disposal of fixed assets, intangible
assets and other long-term assets(gain is -101,056.08 -449,051.44
listed with “-”)
Loss from discarding fixed assets as useless
18,924.00
(gain is listed with “-”)
Financial expenses (gain is listed with “-”) 11,476,211.74 53,144,384.74
Investment loss (income is listed with “-”) -333,974.06 -25,247,171.27
Decrease of deferred income tax assets
-2,075,205.01 -148,336.70
(increase is listed with “-”)
Decrease of inventory (increase is listed with
-19,947,136.21 3,747,924.64
“-”)
Decrease of operating receivable accounts
-65,334,769.96 120,929,685.96
(increase is listed with “-”)
Increase of operating payable accounts
35,982,075.57 7,470,187.45
(decrease is listed with “-”)
Net cash flow arising from operating
-18,693,296.58 173,486,015.99
activities
2. Material investment and financing not
-- --
involved in cash flow:
3. Net change of cash and cash equivalents: -- --
Balance of cash at period end 91,310,804.48 632,846,956.16
Less: Balance of cash at year-begin 632,846,956.16 22,392,147.12
Less: Balance of cash equivalent at year-end 12,704,508.49
Net increasing of cash and cash equivalents -528,831,643.19 610,454,809.04
(2) Constitution of cash and cash equivalent:
In RMB
Item Closing balance Opening balance
135
深圳中恒华发股份有限公司 2016 年年度报告全文
Ⅰ. Cash 91,310,804.48 632,846,956.16
Including: Cash on hand 235,039.12 382,669.21
Bank deposit available for payment
91,075,765.36 632,464,286.95
at any time
II. Cash equivalent 12,704,508.49
Notes receivable due within three months 12,704,508.49
Ⅲ. Balance of cash and cash equivalent at
104,015,312.97 632,846,956.16
period-end
Other explanation:
Monetary fund at year-end-other monetary fund refers to the bank acceptance bond 2,021,905.33 Yuan, which is not belonging to the
cash and cash equivalent.
42. Assets with ownership or use right restricted
In RMB
Item Ending book value Restriction reasons
Monetary Fund 2,021,905.33 Bank acceptance bill
Notes receivable 18,280,643.56 Bank loan secured
Fixed assets 47,662,693.18 Bank loan secured
Intangible assets 44,618,390.91 Bank loan secured
Loans from Hai’er Financial Company
Accounts receivable 6,728,712.37
secured
Investment real estate 28,796,525.38 Bank loan secured
Total 148,108,870.73 --
Other explanation:
Nil
44. Item of foreign currency
(1) Item of foreign currency
In RMB
Closing balance of foreign
Items Rate of conversion Ending RMB balance converted
currency
Monetary Fund -- -- 16,502.99
Including: USD 2,374.77 6.9370 16,473.78
HKD 32.66 0.8945 29.21
Accounts receivable -- -- 46,955,995.68
136
深圳中恒华发股份有限公司 2016 年年度报告全文
Including: USD 6,768,919.66 6.9370 46,955,995.68
Advance account 8,873,087.08
Including: USD 1,279,095.73 6.9370 8,873,087.08
Short term loan 34,710,467.81
Including: USD 5,003,671.30 6.9370 34,710,467.81
Accounts payable 1,172,353.00
Including: USD 169,000.00 6.9370 1,172,353.00
Other explanation:
Nil
(2) Explanation on foreign operational entity, including as for the major foreign operational entity,
disclosed main operation place, book-keeping currency and basis for selection; if the book-keeping
currency changed, explain reasons
□ Applicable √ Not applicable
VIII. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Main operation Share-holding ratio
Subsidiary Registered place Business nature Acquired way
place Directly Indirectly
Huafa Leasing Property Investment
Shenzhen Shenzhen 60.00%
Company management establishment
Huafa Property Property Investment
Shenzhen Shenzhen 100.00%
Company management establishment
Hengfa
Production and Investment
Technology Wuhan Wuhan 100.00%
sales establishment
Company
Hengfa Hengtian Property Investment
Shenzhen Shenzhen 100.00%
Company management establishment
Hengfa Hengtai Property Investment
Shenzhen Shenzhen 100.00%
Company management establishment
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
Nil
Basis for controlling the invested entity with half or below voting rights held and without controlling invested entity but with over
half and over voting rights:
Nil
137
深圳中恒华发股份有限公司 2016 年年度报告全文
Controlling basis for the structuring entity included in consolidated range:
Nil
Basis on determining to be a agent or consignor:
Nil
Other explanation:
Nil
IX. The risk associated with financial instruments
The Group's main financial instruments include loans, receivables, payables, tradable financial assets, trading financial liabilities, etc.,
please refer to the details of each financial instrument in Note 5. The risks associated with these financial instruments and the risk
management policies adopted by the Group to reduce these risks are described below. The management of the Group manages and
monitors these risk exposures to ensure that the above risks are controlled within the limits.
1. Various risk management objectives and policies
The objective of the Group's risk management is to strike a proper balance between risks and profits, minimize the negative impact of
risks on the Group's operating results, and maximize the benefits of shareholders and other equity investors. Based on this risk
management objectives, the Group's basic strategy for risk management is to identify and analyze the risks faced by the Group,
establish appropriate risk bottom lines and carry out risk management, and timely and reliably monitor the risks control them within
the limits.
(1) Market risk
The market risk of financial instruments refers to the risk that the fair value or the future cash flows of financial instruments fluctuate
due to the changes in market prices, including foreign exchange risk, interest rate risk and other price risk.
1) Exchange rate risk
The Group's exchange rate risk is mainly related to US dollars and Hong Kong dollars. Except the Group's second level subsidiary,
Hengfa Technology Company’s monitor business has day-to-day operations in US dollars, other principal business activities of the
Group settle accounts in RMB. On December31, 2016, except for the US dollar balance of assets and liabilities in below table and
the sporadic Hong Kong dollar balance, the Group's assets and liabilities are all RMB balance. The exchange rate risk arising from
the assets and liabilities of the US dollar, Hong Kong dollar balance may have an impact on the Group's operating results.
Item 2016-12-31 (RMB convertion) 2015-12-31 (RMB convertion)
Monetary Fund - USD 16,473.78 78,163.93
Monetary Fund - HKD 29.21 858.74
Accounts receivable - USD 46,955,995.68 49,546,374.57
Advance account - USD 8,873,087.08 464,330.52
Accounts payable - USD 1,172,353.00
Short term borrowings 34,710,467.81 28,879,107.41
- USD
The Company eyes on the influence from viaration of exchange
138
深圳中恒华发股份有限公司 2016 年年度报告全文
2) Interest rate risk
The interest rate risk of the Group arises from bank loans. The financial liabilities of floating interest rate make the Group face cash
flow interest rate risk, and the financial liabilities of fixed rate make the Group face the interest rate risk of fair value. The Group
determines the relative proportion of fixed rate and floating interest rate contracts based on the prevailing market environment. On
December 31, 2016, the Group's interest-bearing debt was mainly the floating interest rate loan contract denominated in Renminbi
and US dollars, amounting to RMB181,210,467.81 (December 31, 2015: RMB674,179,107.41).
The Group's risk of changes in the cash flow of financial instruments due to changes in interest rates is mainly related to the floating
interest rate bank loans. The Group's policy is to maintain the floating interest rate of these loans so as to eliminate the fair value risk
of the interest rate changes.
3) Price risk
The Group sells monitors and so on at market prices and is therefore affected by such price fluctuations.
(2) Credit risk
Credit risk refers to the risk that a party of the financial instrument does not fulfill its obligations and causes property loss to another
party. On December 31, 2016, the maximum credit risk exposure that may cause financial losses to the Group is mainly attributable
to the failure of the other party to fulfill its obligations resulting in the losses of the Group's financial assets and the Group's
financial guarantees, including:
The carrying amount of the financial assets recognized in the consolidated balance sheet; for the financial instruments measured at
fair value, the book value reflects its risk exposures but not the maximum risk exposure, and its maximum risk exposure changes
with the future changes in fair value.
In order to reduce the credit risk, the Group has set up a special department to determine the credit line, carry out the credit approval,
and implement other monitoring procedures to take necessary measures to recover the overdue credit. In addition, the Group reviews
the recovery of each individual receivable at every balance sheet date to accrue sufficient provision for bad debts of uncollectible
funds. As a result, the Group's management believes that the Group's credit risk has been greatly reduced.
The Group's working capital is deposited in banks with higher credit ratings, so the credit risk of working capital is low.
The Group has adopted necessary policies to ensure that all customers have good credit records. In addition to the top five account
receivables, the Group has no other significant credit risk.
The total amount of the top five account receivables is 120,720,685.90 yuan.
(3) Liquidity risk
The liquidity risk is the risk that the Group is unable to fulfill its financial obligations on the due date. The Group's approach to
manage liquidity risk is to ensure that there is sufficient financial liquidity to fulfill its due debts but not cause unacceptable losses or
damages to the corporate reputation. The Group regularly analyzes the structure and duration of liabilities to ensure there are
sufficient funds. The management of the Group monitors the use of bank loans and ensures the compliance with loan agreement, and
conducts financing consultations with financial institutions in order to maintain a certain line of credit and reduce the liquidity risk.
The financial assets and financial liabilities held by the Group based on the maturity of the undiscounted outstanding contractual
139
深圳中恒华发股份有限公司 2016 年年度报告全文
obligations are analyzed as follows
Amount on December 31, 2016
Item Within 1 year 1-2 year 2-3 year Over 3 year Total
Financial assets
Monetary Fund 93,332,709.81 93,332,709.81
Notes receivable 52,663,100.89 52,663,100.89
Accounts receivable 139,808,058.20 139,808,058.20
Other receivables 3,548,868.49 158,753.40 90,355.00 136,400.00 3,934,376.89
Advance account 12,760,284.18 17,494.85 297,942.90 13,075,721.93
Financial liabilities
Short term borrowings 181,210,467.81 181,210,467.81
Notes payable 16,714,584.01 16,714,584.01
Accounts payable 61,929,564.68 216,432.57 206,601.49 11,361,826.03 73,714,424.77
Other payables 13,621,736.30 3,428,298.86 17,050,035.16
Advance receivable 1,067.00 47,779.60 48,846.60
Employee salary 4,542,531.22 4,542,531.22
payable
2. Sensitivity analysis
The Group uses the sensitivity analysis technique to analyze the possible impacts of the reasonable and possible changes in risk
variable on the currents profit and losses or the owner's equity. Since any risk variable rarely changes in isolation, and the correlation
among the variables has a significant effect on the final effect amount of a certain risk variable changes, and the following contents
are on the assumption that the change in each variable is independent.
(1) Sensitivity analysis of foreign exchange risk
Sensitivity analysis of foreign exchange risk assumes that all overseas operating net investment hedges and cash flow hedges are
highly effective.
On the basis of the above assumptions, in case that other variable don’t change, the after-tax effect of the possible and reasonable
changes in the exchange rate on the current profits and losses are as follows
Item Exchange rate 2016 2015
fluctuation Impact on net profit Impact on owner's Impact on net profit Impact on owner's
equity equity
All foreign 5% appreciation of the -998,138.25 -998,138.25 -795,398.26 -795,398.26
currency RMB
All foreign 5% devaluarion of the 998,138.25 998,138.25 795,398.26 795,398.26
currency RMB
140
深圳中恒华发股份有限公司 2016 年年度报告全文
X. Related party and related transactions
1. Parent company of the enterprise
Share-holding ratio
Voting right ratio on
Parent company Registration place Business nature Registered capital on the enterprise for
the enterprise
parent company
Production and sales,
Wuhan Zhongheng real estate
New Technology development and
Wuhan 34,500,000.00 41.14% 41.14%
Industry Group Co., sales, housing
Ltd. leasing and
management
Explanation on parent company of the enterprise
Registered capital and its changes
Controlling shareholder Opening balance Increase in the year Decrease in the year Closing balance
Wuhan Zhongheng Group 34,500,000 34,500,000
Equity or interest held and their changes
Controlling shareholder Share-holding amount Share-holding ratio (%)
Closing balance Opening balance Closing ratio Opening ratio
Wuhan Zhongheng Group 116,489,894.00 116,489,894.00 41.14 41.14
The ultimate control of the enterprise is Li Zhongqiu.
Other explanation:
Nil
2. Subsidiary of the Enterprise
Found in “Composition of Enterprise Group".
3. Other related party
Other related party Relationship with the Enterprise
Shenzhen Zhongheng Huafa Science and Technology Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Hengsheng Yutian Industrial Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Hengsheng Photoelectric Industry Co., Ltd. Control by same controlling shareholder and ultimate controller
Hongkong Yutian International Investment Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan New Oriental Real Estate Development Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Zhongheng Property Management Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Optical Valley Display System Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Yutian Xingye Property Co., Ltd. Control by same controlling shareholder and ultimate controller
141
深圳中恒华发股份有限公司 2016 年年度报告全文
Wuhan Yutian Dongfang Property Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Xiahua Zhongheng Electronics Co. Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Zhongheng Yutian Trade Co., Ltd. Control by same controlling shareholder and ultimate controller
Wuhan Yutian Hongguang Real Estate Co., Ltd. Control by same controlling shareholder and ultimate controller
Shenzhen Zhongheng Huayu Investment Holding Co., Ltd. Control by same controlling shareholder and ultimate controller
Yutian Investment Co., Ltd. (Famous Sky Capital Limited) Control by same controlling shareholder and ultimate controller
Yutian International Co., Ltd. Control by same controlling shareholder and ultimate controller
Hongkong Zhongheng Yutian Co., Ltd. Control by same controlling shareholder and ultimate controller
Shenzhen Yutian Henghua Co., Ltd. Control by same controlling shareholder and ultimate controller
Shenzhen Zhongheng Yongye Technology Co., Ltd. Control by same controlling shareholder and ultimate controller
Shenzhen Yutian Hengrui Co., Ltd. Control by same controlling shareholder and ultimate controller
Other explanation
Nil
4. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
Whether over the
Amount of this Trading limit
Related party Content approved limited or Amount of last period
period approved
not
Hongkong Yutian
International
Purchase good 160,560,343.18 346,850,000.00 N 127,963,832.98
Investment Co.,
Ltd.
Wuhan Hengsheng
Photoelectric Purchase good 48,070,877.55 180,362,000.00 N 2,729,748.60
Industry Co., Ltd.
Goods sold/labor service providing
In RMB
Related party Content Amount of this period Amount of last period
Hongkong Yutian International
Sales good 193,821,823.74 163,903,060.99
Investment Co., Ltd.
Wuhan Hengsheng
Sales good 1,907,193.07 191,218.42
Photoelectric Industry Co., Ltd.
Shenzhen Zhongheng Huafa
Provide labor 476,979.50
Science and Technology Co.,
142
深圳中恒华发股份有限公司 2016 年年度报告全文
Ltd.
Explanation on goods purchasing, labor service providing and receiving
Nil
(2) Related lease
As a lessor for the Company:
In RMB
Lease income in recognized in Lease income in recognized last
Lessee Assets type
the Period the Period
Shenzhen Zhongheng Huafa
Science and Technology Co., House building 1,731,066.00
Ltd.
As a lessee for the Company:
In RMB
Lease income in recognized in Lease income in recognized last
Lessor Assets type
the Period the Period
Explanation on related lease
(3) Related guarantee
As the guarantor
In RMB
Secured party Amount guarantee Start End Completed or not (Y/N)
Hengfa Technology
30,000,000.00 2016-09-19 2018-09-19 No
Company
Hengfa Technology
50,000,000.00 2016-11-01 2017-11-01 No
Company
As the secured party
In RMB
Guarantor Amount guarantee Start End Completed or not (Y/N)
Li Zhongqiu 15,000,000.00 2016-05-19 2017-05-19 No
Li Zhongqiu 5,000,000.00 2016-12-12 2017-12-12 No
Li Zhongqiu 55,000,000.00 2016-07-25 2017-07-24 No
Li Zhongqiu 10,000,000.00 2016-08-11 2017-08-10 No
Li Zhongqiu 20,000,000.00 2016-08-11 2017-08-10 No
Li Zhongqiu 15,000,000.00 2016-08-11 2017-08-10 No
Explanation on related guarantee
Nil
143
深圳中恒华发股份有限公司 2016 年年度报告全文
(4) Remuneration of key manager
In RMB
Item Current Period Last Period
Total 1,394,600.00 1,951,600.00
5. Receivable/payable items of related parties
(1) Receivable item
In RMB
Closing balance Opening balance
Item Related party
Book balance Bad debt reserves Book balance Bad debt reserves
Accounts receivable 41,299,300.89 47,219,865.22
Hongkong Yutian
Advance payment International 8,873,087.08 520,885.50
Investment Co., Ltd.
Wuhan Hengsheng
Interest receivable Photoelectric 1,838,752.40
Industry Co., Ltd.
(2) Payable item
In RMB
Item Related party Ending book balance Opening book balance
Shenzhen Zhongheng Huafa
Other payables Science and Technology Co., 6,288.00 8,663,196.37
Ltd.
Wuhan Hengsheng
Accounts payable 7,173,172.20 924,354.64
Photoelectric Industry Co., Ltd.
6. Commitments of related party
In line with the claim of application for arbitration from Shenzhen Vanke, Shen Hwafa and Wuhang Zhongheng paid and money
together. As the commitment letter to Shen Hwafa from Wuhang Zhongheng Group, if the Vanke wins, the losses from disputes
ariing by contract will bear by Wuhan Zhongheng Gorup in full.
144
深圳中恒华发股份有限公司 2016 年年度报告全文
XI. Commitment or contingency
1. Important commitment
Important commitment on balance sheet date
The Company has no major commitment need to disclosed by end of 31 December 2016.
2. Contingency
(1) Contingency on balance sheet date
I. Commitment or contingency
(i) Commitments
The irrevocable operating lease contract signed by the Company ended as balance sheet date is as:
The Company entered into a House-Leasing Contract with Wuwu Branch of Shenzhen Dachong Industrial Co., Ltd., term of lease
from 18 August 2015 to 17 August 2020
Minimum lease for irrevocable operating lease contract Minimum lease
1st year after balance sheet date 3,847,599.84
2nd year after balance sheet date 3,847,599.84
3rd year after balance sheet date 3,847,599.84
4th year after balance sheet date 2,426,125.45
Total 13,968,924.97
(ii) Contingency
1. Pending arbitration with Shenzhen Vanke
In August 2015, Shenzhen Hwafa and Wuhan Zhongheng New Technology Industry Group Co., Ltd. (hereinafter referred to as
“Wuhan Zhongheng”) signed the “Cooperation Agreement on Urban Renewal Project of Update Units at Huafa Industrial Park,
Gongming Street, Guangming New District, Shenzhen”. As Shenzhen Hwafa and Wuhan Zhongheng planned to cooperate with
Shenzhen Vanke Real Estate CO., Ltd. (hereinafter referred to as “Shenzhen Vanke”) on the Huafa urban renewal project (hereinafter
referred to as “Huafa Renovation Project) at Gongming Street, Guangming New District, Shenzhen, both parties appointed that
Shenzhen Hwafaentrusted Wuhan Zhongheng to represent it in this cooperation, and established project company - Shenzhen Vanke
Guangming Real Estate Co., Ltd. (hereinafter referred to as “Vanke Guangming”) as the subject of project implementation with
Shenzhen Vanke; Vanke Guangming signed “Demolition Compensation Agreement” with Shenzhen Hwafa and Wuhan
Zhongheng, and paid the compensation for demolition.
On August 21, 2015, Shenzhen Hwafa, Wuhan Zhongheng and Shenzhen Vanke signed the “Cooperative Operation Contract of
Renovation Project at Huafa Industrial Park, Gongming Street, Guangming New District”(hereinafter referred to as “Cooperative
Operation Contract”), the contract refined and appointed the cooperation model and operating steps of both sides. And then Shenzhen
Hwafa, Wuhan Zhongheng and Shenzhen Vanke signed the “Agreement on the Housing Acquisition and Removal Compensation
145
深圳中恒华发股份有限公司 2016 年年度报告全文
and Settlement”. After signing the above agreement, Shenzhen Vanke paid the cooperation price of 600 million Yuan to Wuhan
Zhongheng through Vanke Guangming.
In September 2016, Shenzhen Vanke filed an arbitration to South China International Economic and Trade Arbitration Commission
(hereinafter referred to as “South China Arbitration”) as Shenzhen Hwafa and Wuhan Zhongheng violated the appointment of
“Cooperative Operation Contract” and handled the “Confirmation of Subject of Reconstruction Implementation” at an overdue time,
and required Shenzhen Hwafa and Wuhan Zhongheng to pay liquidated damages and attorneys' fees of RMB 464.60 million.
While filing the arbitration, Shenzhen Vanke also applied for property preservation of 400 million yuan of property under the name
of Shenzhen Hafa and Wuhan Zhongheng to Shenzhen Intermediate People 's Court. According to the ruling of Shenzhen
Intermediate People's Court and “Notification of Sealing up, Seizing and Freezing Assets” (The reference numbers are (2016) Yue 03
Cai Bao No. 51, (2016) Yue 03 Cai Bao No. 53), the 27 house properties (Note: the property within the scope of Huafa renovation
project) under the name of Shenzhen Hwafa and 116,489,894 shares (Note: of which 116,100,000 shares have been pledged) of
Shenzhen Hwafa stock held by Wuhan Zhongheng were frozen.
On November 12, 2016, the arbitration court held a hearing on this case.
In December 2016, Wuhan Zhongheng to Shenzhen Hwafa issued a “Commitment Letter” which included that if the arbitration
(Note: the case) ruled in favor of Shenzhen Vanke, the loss of arbitration caused by the contract disputes should be fully assumed by
our company. In the above contingent losses, if the judicial decision ruled your company to pay the compensation in advance, our
company promised to pay your company in cash within one month, if our company could not pay on time due to uncontrollable
factors, our company would like to pay the corresponding interest according to the benchmark interest rate of bank loans in the
corresponding period. Because the plots in the renovation project placed in our company hadn’t been applied for transfer procedures
and were still under your company’s name (Note: based on the “Asset Replacement Contract” signed by Wuhan Zhongheng and
Shenzhen Hwafa on April 29, 2009), therefore, there was no risk of compliance, at the same time, our company promised to give
priority to paying the above compensation with the compensation for demolition of renovation project.
On March 14, 2017, Shenzhen Hwafa received the “Decision of Arbitrator not Granting Avoiding” issued by South China Arbitration,
which rejected the application for avoiding of chief arbitrator proposed by Shenzhen Vanke. On March 15, 2017, Shenzhen Hwafa
received the “Letter About the Resignation of the Chief Arbitrator of No. SHEN DP20160334 Case” signed by the chief arbitrator
and forwarded by South China Arbitration. On March 20, 2017, Shenzhen Hwafa received the “Letter About the Resignation of the
Arbitrator of No. SHEN DP20160334 Case” forwarded by South China Arbitration, the arbitrator selected by Shenzhen Vanke said
to resign from the arbitrator of this case due to physical reasons.
The deadline for giving a ruling to this case was originally scheduled on February 12, 2017. According to the “Decision of
Adjourning the Ruling” issued by South China Arbitration on February 10, 2017, the deadline for giving a ruling to this case shall be
prolonged to May 12, 2017. Due to the changes in the members of above arbitration court, this case needs South China Arbitration to
reassign the chief arbitrator and Shenzhen Vanke to reselect the arbitrators. According to the provisions of article 32 of the
Arbitration Rules of South China Arbitration, after constituting the new arbitration court, it shall decide whether all or part of the
hearing procedures that have been carried out before need to be reopened; if the arbitration court decides to reopen all hearing
procedures, then the deadline for giving a ruling shall be calculated from the date that the arbitration court decides to reopen the
hearing procedures. Therefore, the deadline for giving a ruling in this time is likely to be further extended.
2. Contingent liability from other pending lawsuits and influence on financial
Litigious party Types of litigation, time Cau Refer Amount Note
and explanation se of ence
146
深圳中恒华发股份有限公司 2016 年年度报告全文
action number
-----2016.03.08 (People’s Amount of
Court of Futian District, prosecution:
Shenzhen Municipal) accepted Lease (2016)Yue 733,800 Yuan
Defendant: Shenzhen Jifang ----2016.03.24 Bank account contract 0304 Min
Investment Co., Ltd., security- 550000 Yuan dispute Chu No.:
Shenzhen Jianianhua -----Hearing date: 2017.3.7 5870
Foreign Trade Clothing City no verdict
Co., Ltd.
----2016.03.23 (People’s Court Lease Amount of
Defendant: Shenzhen of Baoan District, Shenzhen contract prosecution:
Huayongxing Municipal) accepted dispute 2016Yue 9,472,600 Yuan
Environmental Technology (People’s Court of Baoan 0306 Min
Co., Ltd., and Shenzhen District, Shenzhen Municipal) Chu No.
Yidaxin Technology Co., Bank account security- 8 6180
Ltd. million Yuan (in middle of
payment)
-----2017.3.20 hearing no
verdict
----2016.03.24(People’s Court Lease Amount of
of Baoan District, Shenzhen contract prosecution:
Defendant: Shenzhen Municipal) accepted dispute 2016Yue 19,649,200
Huayongxing -----2016.04.11(People’s Court 0306 Yuan
Environmental Technology of Baoan District, Shenzhen Min Chu
Co., Ltd., Shenzhen Municipal) Bank account No.6229
Guangyong Breadboard security- 17 million Yuan
Co., Ltd., Shenzhen ------2017.2.14 hearing no
Mingyi Electronic Co., verdict
Ltd., Shenzhen Ouruilai
Technology Co., Ltd and
Shenzhen Kangzhengxin
Technology Co., Ltd.
XII. Event occurring after balance sheet date
1. Other explanation on events occurring after the balance sheet date
Ended as the disclosure date for the Report, the Company has no events occurrring after balance sheet date need to disclosed
147
深圳中恒华发股份有限公司 2016 年年度报告全文
XIII. Other important event
1. Error correction for previous period
(1) Retrospective restatement
In RMB
Item with impact in statement
Correction content Treatment procedure Cumulative impact
in every comparative period
The rental for year of 2015 was
mis-listed as cash deposit as
collateral, and adjsuted to Management fees 99,643.33
administrative expenses as rental
charge
The rental for year of 2015 was
mis-listed as cash deposit as
collateral, and adjsuted to Other receivables -99,643.33
administrative expenses as rental
charge
The company collected the
financing income of T2 class
trust units in trust plan of 2015
CITIC QianjingGreen
Xingcheng investment funds and
Business taxes and surcharges -3,473,866.67
accrued the business tax and
additional tax which were
identified not belonging to the
business tax scope and were
corrected and returned back
The company collected the
financing income of T2 class
trust units in trust plan of 2015
CITIC QianjingGreen
Xingcheng investment funds and
Tax payable – Business tax -3,101,666.67
accrued the business tax and
additional tax which were
identified not belonging to the
business tax scope and were
corrected and returned back
The company collected the
Tax payable – Urban
financing income of T2 class
maintenance and construction -217,116.67
trust units in trust plan of 2015
tax
CITIC QianjingGreen
148
深圳中恒华发股份有限公司 2016 年年度报告全文
Xingcheng investment funds and
accrued the business tax and
additional tax which were
identified not belonging to the
business tax scope and were
corrected and returned back
The company collected the
financing income of T2 class
trust units in trust plan of 2015
CITIC QianjingGreen
Xingcheng investment funds and Tax payable – Education
-93,050.00
accrued the business tax and surcharge
additional tax which were
identified not belonging to the
business tax scope and were
corrected and returned back
The company collected the
financing income of T2 class
trust units in trust plan of 2015
CITIC QianjingGreen
Xingcheng investment funds and Tax payable – Local education
-62,033.33
accrued the business tax and surcharge
additional tax which were
identified not belonging to the
business tax scope and were
corrected and returned back
The correction above mentioned
have impact on income tax and Income tax expense 843,555.84
retained profit of the Company
The correction above mentioned
Tax payable – Corporate
have impact on income tax and 843,555.84
income tax
retained profit of the Company
The correction above mentioned
have impact on income tax and Undistributed profit 2,530,667.50
retained profit of the Company
XIV. Principle notes of financial statements of parent company
1. Accounts receivable
(1) Category of account receivable
In RMB
149
深圳中恒华发股份有限公司 2016 年年度报告全文
Closing balance Opening balance
Book balance Bad debt reserves Book balance Bad debt reserves
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Account receivable
with single
significant amount 5,094,41 5,094,41 5,094,4 5,094,414
49.05% 100.00% 49.05% 100.00%
and withdrawal bad 4.36 4.36 14.36 .36
debt provision
separately
Account receivable
with bad debt 460,277 138,083.3
4.43% 30.00% 322,194.43
provision accrual by .76 3
portfolio
Accounts with single
significant amount
5,292,43 5,292,43 4,832,1 4,832,157
and bad debts 50.95% 100.00% 46.52% 100.00%
5.32 5.32 57.56 .56
provision accrued
individually
10,386,8 10,386,8 10,386, 10,064,65
Total 100.00% 100.00% 322,194.43
49.68 49.68 849.68 5.25
Account receivable with major single amount and withdrawal bad debt provision single at period-end:
√ Applicable □ Not applicable
In RMB
Account receivable (by Closing balance
unit) Accounts receivable Bad debt reserve Provision ratio Provision reason
TCL ACE ELECTRIC
APPLIANCE 1,325,431.75 1,325,431.75 100.00% Un-recyclable
(HUIZHOU) CO., LTD.
SKYWORTH Multimedia
672,769.28 672,769.28 100.00% Un-recyclable
(Shenzhen) Co., Ltd.
Hongkong Haowei
1,870,887.18 1,870,887.18 100.00% Un-recyclable
Industry Co. Ltd.
Qingdao Haier Parts
1,225,326.15 1,225,326.15 100.00% Un-recyclable
Procurement Co., Ltd.
Total 5,094,414.36 5,094,414.36 -- --
Account receivable with bad debt provision withdrawal by method of account age in portfolio:
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on balance proportion for account receivable:
150
深圳中恒华发股份有限公司 2016 年年度报告全文
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for account receivable:
Accounts with single significant amount and bad debts provision accrued individually at year-end
Debtor Book balance Bad debt Accrual ratio Reasons
Shenzhen Huixin Video Technology Co., Ltd. 381,168.96 381,168.96 100 Uncollectible
Shenzhen Wandelai Digital Technology Co., Ltd. 351,813.70 351,813.70 100 Uncollectible
Shenzhen Dalong Electronic Co., Ltd. 344,700.00 344,700.00 100 Uncollectible
Shenzhen Keya Electronic Co., Ltd. 332,337.76 332,337.76 100 Uncollectible
Vietnam International Shipping International Co.,
323,405.97 323,405.97 100 Uncollectible
Ltd.
Shenzhen Qunping Electronic Co., Ltd. 304,542.95 304,542.95 100 Uncollectible
China Galaxy Electronics (Hong Kong) Co., Ltd. 288,261.17 288,261.17 100 Uncollectible
Dongguan Weite Electronic Co., Ltd. 274,399.80 274,399.80 100 Uncollectible
Hong Kong New Century Electronics Co., Ltd. 207,409.40 207,409.40 100 Uncollectible
Shenyang Beitai Electronic Co., Ltd. 203,304.02 203,304.02 100 Uncollectible
Beijing Xinfang Weiye Technology Co., Ltd. 193,000.00 193,000.00 100 Uncollectible
TCL Electronics (Hong Kong) Co., Ltd. 145,087.14 145,087.14 100 Uncollectible
Huizhou TCL Xinte Electronics Co., Ltd. 142,707.14 142,707.14 100 Uncollectible
SkyWorth – RGB Electronic Co., Ltd. 133,485.83 133,485.83 100 Uncollectible
Other 1,666,811.48 1,666,811.48 100 Uncollectible
Total 5,292,435.32 5,292,435.32
(2) Bad debt provision accrual, switch-back or taken back in reporting period
Bad debt provision accrual was 322,194.43 Yuan; the amount collected or switches back amounting to 0 Yuan.
Including major amount of bad debt provision that switch-back or taken back in the Period:
In RMB
Company Amount switch back or taken back Way
(3)Top five receivables collected by arrears party at ending balance
Total year-end balance of top five receivables by arrears party amounting to 5,475,583.32 Yuan, takes 52.72 percent of the total
account receivable at year-end, bad debt provision accrual correspondingly at year-end amounting as 5,475,583.32 Yuan.
151
深圳中恒华发股份有限公司 2016 年年度报告全文
2. Other accounts receivable
(1) Category of other account receivable
In RMB
Closing balance Opening balance
Book balance Bad debt reserves Book balance Bad debt reserves
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Other account
receivable with
single significant 123,637, 10,601,6 113,035,8 79,834, 10,221,04 69,613,032.
93.25% 8.57% 87.09% 12.80%
amount and 504.36 86.53 17.83 078.95 6.53 42
withdrawal bad debt
provision separately
Other account
receivable with bad 965,485. 13,050.4 952,435.3 6,668,8 168,615.3 6,500,232.8
0.73% 1.35% 7.28% 2.53%
debt provision 79 5 4 48.13 2 1
accrual by portfolio
Other account
receivable with
single minor amount 7,988,48 7,909,68 5,160,8 5,160,853
6.02% 99.01% 78,798.40 5.63% 100.00% 0.00
but withdrawal single 4.16 5.76 53.27 .27
item bad debt
provision
132,591, 18,524,4 114,067,0 91,663, 15,550,51 76,113,265.
Total 100.00% 100.00%
474.31 22.74 51.57 780.35 5.12 23
Other account receivable with major single amount and withdrawal bad debt provision single at period-end:
√ Applicable □ Not applicable
In RMB
Closing balance
Other account receivable
Other account
(units) Bad debt provision Accrual ratio Accrual reason
receivable
Wuhan Hengfa
89,353,064.98 No bad debt risk
Technology Co. Ltd.
Shenzhen Zhongheng
22,153,326.21 No bad debt risk
Huafa Property Co., Ltd.
Shenzhen Huafa Property
4,558,859.15 4,558,859.15 100.00% Un-recyclable
Leasing Co., Ltd.
Portman 4,021,734.22 4,021,734.22 100.00% Un-recyclable
152
深圳中恒华发股份有限公司 2016 年年度报告全文
Zhao Baomin 564,646.35 564,646.35 100.00% Un-recyclable
Shenzhen Jifang
1,268,800.00 380,640.00 30.00% Partially recyclable
Investment Co., Ltd.
Hebei Botou Court 520,021.00 520,021.00 100.00% Un-recyclable
Traffic accident
555,785.81 555,785.81 100.00% Un-recyclable
compensation
Wuwu Branch of
Shenzhen Dachong 641,266.64 Deposit without accrual
Industrial Co., Ltd.
Total 123,637,504.36 10,601,686.53 -- --
Other account receivable with bad debt provision withdrawal by method of account age in portfolio:
√ Applicable □ Not applicable
In RMB
Closing balance
Account age
Other receivable Bad debt reserves Accrual ratio
Sub-item of within one year
Subtotal of within one year 824,831.79
1-2 year 44,299.00 2,214.95 5.00%
2-3 year 90,355.00 9,035.50 10.00%
Over three years 6,000.00 1,800.00 30.00%
Total 965,485.79 13,050.45
Explanation on portfolio basis:
In combination, withdrawal proportion of bad debt provision based on balance proportion for other account receivable:
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for other account receivable:
√ Applicable □ Not applicable
Other account receivable with single minor amount but withdrawal single item bad debt provision at year-end
Debtor Book balance Bad debt Accrual ratio (%) Reasons
Jiantao (Fogang) Laminates Co., Ltd. 465,528.10 465,528.10 100 Uncollectible
Shenzhen Lotus Island Restaurant Co., Ltd. 236,293.80 236,293.80 100 Uncollectible
Shenzhen Mingli Co., Ltd. 170,394.84 170,394.84 100 Uncollectible
China Great Wall Computer Shenzhen Company
168,436.33 168,436.33 100 Uncollectible
Limited
Shenzhen Hongya Electronic Co., Ltd. 156,390.00 156,390.00 100 Uncollectible
Shangxi Shengyi Technology Co., Ltd. 156,239.32 156,239.32 100 Uncollectible
Changchun Artificial Resin Co., Ltd. 147,486.96 147,486.96 100 Uncollectible
Shenzhen Xinlan Technology Co., Ltd. 138,038.00 138,038.00 100 Uncollectible
Fujian Zhangzhou Weili Electronic Enterprise 112,335.62 112,335.62 100 Uncollectible
153
深圳中恒华发股份有限公司 2016 年年度报告全文
Co., Ltd.
Chuangjing Studio 192,794.00 192,794.00 100 Uncollectible
Individuals borrow 1,799,073.12 1,799,073.12 100 Uncollectible
Labor union 332,402.55 332,402.55 100 Uncollectible
Staff canteen etc. 856,753.66 856,753.66 100 Uncollectible
Other 2,977,519.46 2,977,519.46 100 Uncollectible
Shenzhen Poly Property Group Co., Ltd. 78,798.40
Total 7,988,484.16 7,909,685.76 —— ——
(2) Bad debt provision accrual, switch-back or taken back in reporting period
Bad debt provision accrual was 1,972,747.59 Yuan; the amount collected or switches back amounting to 4,312.80 Yuan.
Including major amount of bad debt provision that switch-back or taken back in the Period:
In RMB
Company Amount switch-back or taken back Way
(3) Other receivables by nature
In RMB
Nature Ending book balance Opening book balance
Margin and deposit 720,065.04 720,065.04
Borrow money 2,570,694.91 2,041,924.43
Intercourse funds 123,104,890.35 80,121,194.79
Rent receivable 6,195,824.01 8,780,596.09
Total 132,591,474.31 91,663,780.35
(4) Top 5 other receivables collected by arrears party at ending balance
In RMB
Proportion in total
Ending balance of
Company Nature Ending balance Account age other receivables at
bad debt provision
year-end
Wuhan Hengfa Within 1 year and
Intercourse funds 89,353,064.98 67.90%
Technology Co. Ltd. 1-2 year
Shenzhen Zhongheng
Within 1 year and
Huafa Property Co., Intercourse funds 22,153,326.21 16.84%
1-2 year
Ltd.
Shenzhen Huafa
Intercourse funds 4,558,859.15 Over three years 3.46% 4,558,859.15
Property Leasing Co.,
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深圳中恒华发股份有限公司 2016 年年度报告全文
Ltd.
Lease receivable /
Portman 4,021,734.22 Over three years 3.06% 4,021,734.22
Intercourse funds
Shenzhen Jifang Within 1 year and
Lease receivable 1,268,800.00 0.96% 380,640.00
Investment Co., Ltd. 1-2 year
Total -- 121,355,784.56 -- 92.23% 8,961,233.37
3. Long-term equity investment
In RMB
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Investment for
187,208,900.00 600,000.00 186,608,900.00 187,208,900.00 600,000.00 186,608,900.00
subsidiary
Total 187,208,900.00 600,000.00 186,608,900.00 187,208,900.00 600,000.00 186,608,900.00
(1) Investment for subsidiary
In RMB
Ending balance of
Increase during Decrease during Impairment
The invested entity Opening balance Closing balance impairment
the period this period accrual
provision
Huafa Leasing
600,000.00 600,000.00 600,000.00
Company
Huafa Property
1,000,000.00 1,000,000.00
Company
Hemgfa
Technology 183,608,900.00 183,608,900.00
company
Huafa Hengtian
1,000,000.00 1,000,000.00
Company
Huafa Hengtai
1,000,000.00 1,000,000.00
Company
Total 187,208,900.00 187,208,900.00 600,000.00
4. Operating income and cost
In RMB
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深圳中恒华发股份有限公司 2016 年年度报告全文
Current Period Last Period
Items
Income Cost Income Cost
Other business 43,547,414.64 6,585,571.92 54,055,168.03 8,764,361.27
Total 43,547,414.64 6,585,571.92 54,055,168.03 8,764,361.27
Other explanation:
Other business - by category
Current Period Last Period
Item
Income Cost Income Cost
Subtotal of
43,547,414.64 6,585,571.92 54,055,168.03 8,764,361.27
other business
Property
38,068,434.47 1,832,841.70 46,341,950.50 1,640,794.86
leasing
Utilities and
5,478,980.17 4,752,730.22 7,713,217.53 7,123,566.41
others
Total 43,547,414.64 6,585,571.92 54,055,168.03 8,764,361.27
5. Investment gains
In RMB
Item Current Period Last Period
Other 25,246,527.78
Total 25,246,527.78
XV. Supplementary Information
1. Current non-recurring gains/losses
√ Applicable □ Not applicable
In RMB
Item Amount Note
Gains/losses from the disposal of
82,132.08
non-current asset
Governmental subsidy reckoned into current
gains/losses (not including the subsidy
enjoyed in quota or ration according to 1,419,888.89
national standards, which are closely
relevant to enterprise’s business)
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深圳中恒华发股份有限公司 2016 年年度报告全文
Other non-operating income and expenditure
-1,209,982.33
except for the aforementioned items
Other gain/loss items satisfying the
333,974.06
definition of nonrecurring gain/loss account
Less: impact on income tax 278,229.19
Total 347,783.51 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss, explain reasons
□ Applicable √ Not applicable
2. REO and earnings per share
Earnings per share
Profits during report period Weighted average ROE Diluted EPS
Basic EPS (RMB/Share)
(RMB/Share)
Net profits belong to common stock
1.72% 0.0193 0.0193
stockholders of the Company
Net profits belong to common stock
stockholders of the Company after
1.61% 0.0180 0.0180
deducting nonrecurring gains and
losses
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
157
深圳中恒华发股份有限公司 2016 年年度报告全文
Section XII. Documents available for reference
I. Text of the Annual Report caring signature of the Chairman;
II. Financial statement carrying the signatures and seals of the person in charge of the Company, principal of the
accounting works and person in charge of accounting organ;
III. All documents of the Company and manuscripts of public notices that disclosed in the China Securities journal,
Securities Times and Hong Kong Commercial Daily designated by CSRC in the report period;
IV. Article of Association
V. Other relevant files.
158
