FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
飞亚达（集团）股份有限公司
FIYTA HOLDINGS LTD.
Semi-Annual Report 2012 （Full Text）
August 24, 2012
1
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
2012 Semi-annual Report
I. Important Notice
The Board of Directors, the Supervisory Committee, directors, supervisors and senior executives hereby
individually and collectively accept responsibility for the correctness, accuracy and completeness of the
contents of this report and confirm that there are no material omissions or errors which would render any
statement misleading.
All the directors attended the board meeting for reviewing the Semi-annual Report.
The Companys Semi-annual Financial Statements has not been audited by CPAs.
Mr. Wu Guangquan, the Company leader, Mr. Li Dehua, chief financial officer and the Mr. Hu Xinglong,
the person in charge of the accounting department (the person in charge of the accounting) hereby
confirm the authenticity and completeness of the financial report enclosed in this semi-annual report..
Definition
Terms to be defined Refer to Definition
This Company, the Company or FIYTA Refers to FIYTA Holdings Ltd.
CATIC Shenzhen Refers to CATIC Shenzhen Holdings Limited
HARMONY: Refers to Shenzhen Harmony World Watches Center Co., Ltd.
Rainbow Supermarket Refers to Rainbow Supermarket Co., Ltd.
CATIC Real Estate Refers to CATIC Real Estate Co., Ltd.
CATIC Property Refers to Shenzhen CATIC Property Management Co., Ltd.
II. Company Profile:
(I) Company Information
A-share stock code 000026 B-share stock code 200026
A-share ticker FIYTA A B-share ticker FIYTA B
Stock Exchange Listed
Shenzhen Stock Exchange
with
Registered Company
飞亚达（集团）股份有限公司
Name In Chinese
Abbreviation of
Registered Company 飞亚达公司
Name in Chinese
Registered Company
FIYTA HOLDINGS LTD.
Name in English
2
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Abbreviation of
Registered Company FIYTA
Name in English
Legal Representative Wu Guangquan
Registered address: FIYTA Technology Building, Gaoxin S. Road One, Nanshan District, Shenzhen
Postal Code of the
518057
Registered Address
th
Office Address 20 Floor, FIYTA Technology Building, Gaoxin S. Road One, Nanshan District, Shenzhen
Postal Code of the Office
518057
Address
Internet Web Site http:// www.fiytagroup.com
E-mail investor@fiyta.com.cn
(II) Liaison Person and Communication Information
Secretary of the Board Securities Affairs Representative
Names Chen Libin Zhang Yong
th th
20 Floor, FIYTA Technology 20 Floor, FIYTA Technology
Liaison Address Building, Gaoxin S. Road One, Building, Gaoxin S. Road One,
Nanshan District, Shenzhen Nanshan District, Shenzhen
Tel. 0755-86013669 0755-86013669
Fax 0755-83348369 0755-83348369
E-mail investor@fiyta.com.cn investor@fiyta.com.cn
(III) Information Disclosure and Place of Regular Reports Prepared for Inquiry
Newspapers Designated for Disclosing Securities Times
the Information: and Hong Kong Commercial Daily
Internet Web Site Designated by China
Securities Regulatory Commission for
http://www.cninfo.com.cn
Publishing the Companys semi-annual
report:
Place of the Companys Semi-annual
Secretariat of the Board of Directors
Report Prepared for Inquiry
III. Financial and Business Highlights
(I) Key Accounting Data and Financial Indicators
Is there any retroactive adjustment of the financial statements of the previous reporting period.
√ Yes
Accounting data summary
3
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Increase/decrease of the
reporting period vs the
Reporting Same Period of the Previous Year
same period of the
Accounting data summary period (Jan to previous year(%)
Jun)
Before After
After adjustment
adjustment adjustment
1,483,755,811.3 1,232,010,736. 1,232,010,736.
Total revenues, in CNY 20.43%
6 41 41
Operating Profit, in CNY
80,596,906.17 102,601,007.36 95,784,459.17 -15.86%
Total profit, in CNY 82,333,120.60 103,969,019.95 97,152,471.76 -15.25%
Net profit attributable to the
Companys shareholders, in 65,289,417.62 85,990,142.75 79,173,594.56 -17.54%
CNY
Net profit attributable to the
Companys shareholders less
66,113,217.45 87,145,297.28 87,145,297.28 -24.13%
the non-recurring items, in
CNY
Net cash flows arising from -103,426,718.8 -106,648,569.9
-93,347,203.62
operating activities, in CNY 2 7
Increase/decrease of the
reporting period vs the
End of the previous year
End of the same period of the
reporting period previous year (%)
Before After
After adjustment
adjustment adjustment
3,306,412,693. 2,895,775,774. 3,061,600,094.
Total assets, in CNY 8%
19 19 74
Owners equity attributable to
1,394,286,721. 1,391,003,807. 1,425,864,692.
the Companys shareholders, -2.21%
36 94 45
in CNY
Share capital, in shares 392,767,870.00 392,767,870 392,767,870.00 0%
Financial Data Summary
Increase/decrease of the
reporting period vs the
Same Period of the Previous Year
Reporting period same period of the
Financial Data Summary previous year(%)
(Jan to Jun)
Before
After adjustment After adjustment
adjustment
Basic earning per share
0.166 0.219 0.202 -17.82%
(CNY/share)
Diluted earning per share
0.166 0.219 0.202 -17.82%
(CNY/share)
Basic earning per share after
deducting the non-recurring 0.168 0.222 0.222 -24.32%
gains and loss (CNY/share)
Net assets-income ratio, fully
4.68% 6.49% 5.78% -1.1%
diluted (%)
Net assets-income ratio ,
4.63% 6.75% 5.99% -1.36%
weighted average, (%)
Net assets-income ratio after
deducting the non-recurring
4.74% 6.57% 6.36% -1.62%
gains and loss, fully diluted
(%)
Net assets-income ratio less
the non-recurring gains and 4.68% 6.84% 6.6% -1.92%
loss, weighted (%)
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Net cash flows per share
arising from operating -0.24 -0.263 -0.27 11.11%
activities (CNY/share)
Increase/decrease of the
reporting period vs the
End of the previous year
End of the same period of the
reporting period previous year (%)
Before
After adjustment After adjustment
adjustment
Net asset per share
attributable to the Companys 3.55 3.54 3.63 -2.2%
shareholders (CNY/share)
Gear Ratio (%) 57.75% 51.87% 53.34% 4.41%
Note to the Key Accounting Data And Financial Indicators at the End of the Reporting Period
th
The 29 Meeting of the Sixth Board of Directors of FIYTA Holdings Ltd. held on December 14, 2011 approved Proposal
on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World Watches
Center Co., Ltd. and the Extraordinary Shareholders Meeting held on January 4, 2012 reviewed and approved the
Proposal on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World
Watches Center Co., Ltd. According to the Agreement on Assignment of the Equity to the Third Party and the Contract on
Equity Assignment, the Company paid CNY 28.05 million, the balance of the payment for the equity acquired equal to
50% of the total payment in February, 2012; the total payment involved in the equity acquisition was CNY 56.10 million. By
then, the Company had finished acquisition of 100% equity in Hengdarui. As the three parties participated in the
assignment of the equity, namely the Company, CATIC Shenzhen Company Limited (“CATIC Shenzhen”), the Companys
actual controlling shareholder, and CATIC Trust Co., Ltd. are related parties. Therefore, in the reporting period, Hengdarui,
as an enterprise under common control, has been included in the consolidated statement range and the consolidation
date was February 28, 2012. According to the requirement on consolidation of an enterprise under common control as
specified in the Accounting Standards for Enterprises, the Company made retroactive adjustment of the data as at year
beginning and the same period of the previous year.
(II) Difference in Accounting Data under the Domestic and International Accounting Standards
1. Difference in Net Profit and Net Assets in the Financial Report as Disclosed Respectively
according to the International Accounting Standards and the Chinese Accounting Standards
Inapplicable
2. Difference in Net Profit and Net Assets in the Financial Report as Disclosed Respectively
according to the Accounting Standards Outside Mainland China and the Chinese Accounting
Standards
Inapplicable
3. Significant Difference Existing in the Specific Items
Inapplicable
4. Note to the Difference in the Accounting Data based on the Accounting Standards Outside
Mainland China
Inapplicable
(III) Deducting non-recurring gains/losses and the amount involved
Amount in CNY
Items Description
Gain/loss from disposal of non-current assets -9,431.30
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Tax rebate or reduction with approval by
overstepping authority, or without formal approval
document
Government subsidy recognized in current gain and
loss (excluding those closely related to the
Companys business and granted under the states 567,500.00
policies according to certain quota of amount or
volume)
Fund occupancy consideration received from
non-financial institution counted to the current gains
and losses
Income from the costs of the investments in the
subsidiaries, associates and joint ventures as
acquired less than the fair value of the enjoyable
recognizable net assets of the investees at the time
of investment acquired.
Exchange gain/loss from non-monetary assets
Gain/loss from entrusted investment or asset
management
Provision for impairment of various assets arising
from force majeure, such as natural disaster
Gains and losses from debts reorganization
Enterprise reorganization fee, such as expenses for
arrangement for employees, integration fee, etc.
Gains/losses exceeding the fair value arising from
transactions with obviously unfair prices
Net gain and loss of the subsidiary under the
common control and produced from enterprise
-2,130,265.54
consolidation from the beginning of the period to the
consolidation date
Gain and loss arising from contingent matters
irrelevant with the Companys normal operation
business
Gain and loss from change of the fair value arising
from transactional monetary assets, transactional
financial liabilities as held as well as the investment
income arising from disposal of the transactional
monetary assets, transactional financial liabilities and
financial assets available for sale excluding the
effective hedging transaction in connection with the
Companys normal business
Reverse of the provision for impairment of accounts
receivable undergoing impairment test individually
Gain/loss from external entrustd loan
Gain and loss arising from change in the fair value of
the investment based real estate measured
afterwards by means of fair value model
Influence upon the current gains and losses from the
once-and-for-all adjustment over the current gains
and losses according to the taxation and accounting
laws and regulations
Income from custodian charge obtained from
entrusted operation
Operating income and expenses other than the
1,178,145.73
aforesaid items
Other gains/losses in compliance with the definition
of non-recurring gain/loss
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Amount influencing the minority shareholders equity
Amount influencing the income tax -429,748.72
Total -823,799.83 --
Note to the “gains and losses in compliance with the definition of non-recurring gains and losses” as well
as the Company in defining the “ non-recurring gains and losses based on the nature and characteristics
of its own main business as the recurring gainses and losses.
Inapplicable
IV. Change in Share capital and Particulars about Shareholders
(I) Change in Share capital
1. Change in the Company’s Shares
Before the change Increase / Decrease (+/ -) After the change
Shares
Quantit Proport New Bonus convert Sub-tot Quantit Proport
Others
y ion (%) issuing shares ed from al y ion (%)
reserve
199,75 -36,727 -36,727 163,02
I. Restricted shares 50.86% 41.5%
4,106 ,046 ,046 7,060
1. State shares
2. State corporate 173,10 -10,127 -10,127 162,97 41.49
44.07%
shares 4,373 ,046 ,046 7,327 %
3. Other domestic 26,600, -26,600 -26,600
6.77%
shares 000 ,000 ,000
Including: Domestic 26,600, -26,600 -26,600
6.77%
corporate shares 000 ,000 ,000
Domestic natural
person shares
4. Foreign shares
Including: Foreign
corporate shares
Overseas natural
person shares
5. Senior executive
49,733 0.01% 49,733 0.01%
shares
193,01 36,727, 36,727, 229,74
II. Unrestricted shares 49.14% 58.5%
3,764 046 046 0,810
1. CNY ordinary 111,365 36,727, 36,727, 148,09 37.71
28.35%
shares ,764 046 046 2,810 %
2. Foreign shares listed 81,648, 81,648 20.79
20.79% 0
in Mainland China 000 ,000 %
3. Foreign shares listed
out of Mainland China
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
4. Others
392,76 392,76
III. Total Shares 7,870.0 100% 7,870. 100%
0 00
Approval of Shareholding Movements:
The Company issued “the Suggestive Announcement on Listing of the Non-Publically Issued Resitrcted Shares 2012-002”
on January 4, 2012, according to which the Company discharged 36,727,046 shares for restriction, taking 9.35% of the
Companys total shares. They were the shares with trading limited conditions from non-public offering in 2010.
Status of Transfer for Shareholdings' Movements:
Inapplicable
Influence fron the shareholding movements upon such financial indicators as earnings per share, net asset per share of
the lastest accounting period
Inapplicable
Other information as the Company considers necessary to be disclosed or demanded by the securities regulatory
authority for disclosing
Inapplicable
2. Change of the Shares with Trading Limited Conditions
Number of
Volume of shares Volume of shares Volume of shares
shares with
discharged from with trading with trading
trading limited Causes of Date of
Shareholders trading limited limited conditions limited conditions
conditions at restriction discharging
conditions in the increased in the at the end of the
beginning of the
reporting period reporting period reporting period
reporting period
Non-publically
issued resitrcted
Caitong shares
Securities Co., 4,527,046 4,527,046 0 0 discharged from January 9, 2012
Ltd. trading limited
conditions in
2010
Non-publically
Bohong Shujun issued resitrcted
(Tianjin) Equity shares
Investment Fund 7,000,000 7,000,000 0 0 discharged from January 9, 2012
Partnership Co., trading limited
Ltd. conditions in
2010
Non-publically
issued resitrcted
Changzhou shares
Investment 5,600,000 5,600,000 0 0 discharged from January 9, 2012
Group Co., Ltd. trading limited
conditions in
2010
Taikang Life
Non-publically
Insurance
issued resitrcted
Co.,Ltd.-Deviden
shares
d
700,000 700,000 0 0 discharged from January 9, 2012
Distribution-Grou
trading limited
p Dividend
conditions in
Distributino-019L
2010
-FH001 SHEN
Non-publically
Taikang Life
issued resitrcted
Insurance Co.,
shares
Ltd. – Toulian –
4,900,000 4,900,000 0 0 discharged from January 9, 2012
Jinqu
trading limited
-019L-TL002
conditions in
SHEN
2010
China Non-publically
Construction 8,400,000 8,400,000 0 0 issued resitrcted January 9, 2012
Bank – ICBC shares
Credit Suisse discharged from
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Steady Growth trading limited
Stock Based conditions in
Securities 2010
Investment Fund
China
Non-publically
Construction
issued resitrcted
Bank – First
shares
State Cinda
5,460,000 5,460,000 0 0 discharged from January 9, 2012
Leading Growth
trading limited
Stock Type
conditions in
Securities
2010
Investment Fund
China
Non-publically
Construction
issued resitrcted
Bank – First
shares
State Cinda
140,000 140,000 0 0 discharged from January 9, 2012
Stable Value
trading limited
Bond Type
conditions in
Securities
2010
Investment Fund
Total 36,727,046 36,727,046 0 0 -- --
(II) Issuing and Listing
1. Issuing Activities over the Past Three Years
Description of
Issuing Price Quantity Expiration
stock and its Issuing
Issuing date (CNY/share) Listing Date approved for date of
Derivative quantity
listing transaction
Securities
Stock Type
A-share stock
from December 14, December 30,
16.01 31,230,480 31,230,480
non-public 2010 2010
issuing
Convertible Corporate Bonds, Detachable Convertible Bond and Corporate Bonds
Inapplicable
Warranties
Inapplicable
Note to the Issuing Activities over the Previous Three Years:
In the reporting period, the Company issued either shares nor derivative securities. The Company started implementation
of the plan of non-public offering of A-shares of 2010. The plan was reviewed and approved at the 8th meeting of the Sixth
Board of Directors dated April 12, 2010 and was approved by China Securities Regulatory Commission with the Official
Reply on Non-public Offering of Fiyta Holdings Ltd. (ZHENG JIAN XU KE [2010] No. 1703) on November 29, 2010. The
Company issued 31,230,480 new shares by non-public offering and completed the procedures of registration for custody
and sales restriction of the newly issued A shares with China Securities Depository and Clearing Company Limited
Shenzhen Branch on December 14, 2010. The listing date of the shares subscribed by the designated investors was
December 30, 2010. The sale restriction term of the shares subscribed by CATIC Shenzhen Holdings Limited, the
Companys controlling shareholder, is 36 months from December 30, 2010 to December 29, 2013. The sale restriction
term of the shares subscribed by Changzhou Investment Group Co., Ltd., First State Cinda Fund Management Co. Ltd.,
Bohong Shujun (Tianjin) Equity Investment Fund Partnership Co., Ltd., ICBC Credit Suisse Asset Management Co. Ltd.,
Taikang Assets Management Co., Ltd. and Caitong Securities Co., Ltd. is 12 months. The restricted shares got listed for
trading on January 9, 2012. (For the detail, refer to the Indicative Announcement on Listing of the Non-Publically Issued
Resitrcted Shares 2012-002). All the designated investors subscribed the shares in cash without assets transfer or
liabilities transfer involved.
2. Change of the Company’s Total Shares and the Strucutre and the Change of the Company’s
Asset Liability Structure Arising Therefrom
Inapplicable
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
3. About the existing employees’ shares
Inapplicable
(III) Shareholders and Actual Controlling shareholder
1. Total shareholders at the end of the reporting period
At the end of the reporting period, the total volume of shareholders was 23,088.
2. Shares held by the top ten shareholders
Shares held by the top ten shareholders
Holding of Pledging or freezing
Nature of Holding
Full names of Total shares the
Shareholde proportions
shareholders held restricted
rs (%) Status of the
shares Quantity
shares
State-owne
CATIC Shenzhen 162,977,3
d corporate 41.49% 162,977,327
Holdings Limited 27
shareholder
China Construction
Domestic
Bank – Huaxia
non-state
Superiority Growth 3.8% 14,920,073 0
corporate
Stock Based Securities
shareholder
Investment Fund
Industrial and
Commercial Bank of Domestic
China – E-Fund Value non-state
2.55% 10,000,000 0
Growth Mixed corporate
Securities Investment shareholder
Fund
China Merchants
Overseas
Securities (HK) Co., 1.53% 6,014,981 0
corporate
Ltd.
Domestic
National Social Security non-state
1.16% 4,550,525 0
Fund No. 118 Portfolio corporate
shareholder
GSI S/A GOLDEN
Overseas
CHINA PLUS MASTER 1.12% 4,416,654 0
corporate
FUND
China Construction
State-owne
Bank – YINHUA
d corporate 1.09% 4,299,994 0
Thematic Wealth Equity
shareholder
Fund
Overseas
KGI ASIA LIMITED 1.09% 4,279,265 0
corporate
10
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Construction Bank of
Domestic
China – YINHUA Core
non-state
Value Selected Stock 1.08% 4,237,656 0
corporate
Based Securities
shareholder
Investment Fund
Industrial and
Commercial Bank of Domestic
China – Guotou Ruiyin non-state
1.07% 4,205,230 0
Growth Selected Stock corporate
Based Securities shareholder
Investment Fund
In the reporting period, there was no hypothecation, freezing or custody of
Note to the shareholders conditions any of the shares held by CATIC Shenzhen Holdings Limited, the
shareholder holding over 5% of the Companys shares.
Shareholding of top 10 shareholders of unrestricted shares
Quantity of
unrestricted Categories and Quantity
Shareholders shares held at the
end of the Categories Quantity
reporting period
China Construction Bank – Huaxia
Superiority Growth Stock Based Securities 14,920,073 A-shares 14,920,073
Investment Fund
Industrial and Commercial Bank of China –
E-Fund Value Growth Mixed Securities 10,000,000 A-shares 10,000,000
Investment Fund
China Merchants Securities (HK) Co., Ltd. 6,014,981 Stock B 6,014,981
National Social Security Fund No. 118
4,550,525 A-shares 4,550,525
Portfolio
GSI S/A GOLDEN CHINA PLUS MASTER
4,416,654 B-shares 4,416,654
FUND
China Construction Bank – YINHUA
4,299,994 A-shares 4,299,994
Thematic Wealth Equity Fund
KGI ASIA LIMITED 4,279,265 B-shares 4,279,265
Construction Bank of China – YINHUA Core
Value Selected Stock Based Securities 4,237,656 A-shares 4,237,656
Investment Fund
Industrial and Commercial Bank of China –
Guotou Ruiyin Growth Selected Stock 4,205,230 A-shares 4,205,230
Based Securities Investment Fund
BANK JULIUS BAER & CO.LTD 3,485,769 B-shares 3,485,769
Explanation on the affiliation or/and concerted actor of the aforesaid shareholder:
The Company has found neither affiliation among the aforesaid shareholders nor concerted actor as specified in the
Measures for Administration of Information on the Shareholder Equity Change of Listed Companies.
3. About Controlling Shareholder and Actual Controlling Shareholder
(1) Change in the Controlling Shareholder and the Actual Controlling Shareholder
Inapplicable
11
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
(2) Particulars about Controlling Shareholder and Actual Controlling Shareholder
Is there any new actual controlling shareholder?
No
Name of the actual controlling shareholder CATIC Shenzhen Company Limited
State-owned Assets Supervision and Administration
Type of the actual controlling shareholder
Commission (SASAC)
Note:
CATIC Shenzhen Company Limited (“CATIC Shenzhen”) was founded on December 1, 1982, with registered capital of
CNY 1000 million and its legal representative is You Lei. principal business: import and export of commodities and
technologies other than those exported exclusively by the central government or under the control by the central
government, compensation trade as importer/exporter as well as agent; investment and initiation of entities; domestic
commerce and supply and sale of goods and materials (excluding the commodities monopolized for operation, under
control of and for exclusive sale by the central government); sales of home-made automobiles (with cars exclusive);
development of real estate; import & export and domestic sales of lubricating oil, fuel oil, chemical products and chemical
materials (excluding dangerous chemicals), purchase and sales of coke (excluding the commodities monopolized for
operation, under control of and for exclusive sale by the central government).
The eventual controlling shareholder of the Companys actual controlling shareholder - CATIC Shenzhen Company
Limited is State-owned Assets Supervision and Administration Commission of the State Council.
(3) Block Diagram of the Ownership and Control Relations between the Company and the Actual
Controlling Shareholder
State-owned Assets Supervision and Administration
Commission of the State Council
100%
Zhongjin Chuangxin National Council for Aviation Industry AVIC CCB Aviation
(Tianjin) Investment Social Security Fund Corporation of China Industry Equity Investment
Co., Ltd. (Tianjin) Co., Ltd.
14.31% 14.31% 62.52% 8.86%
CATIC International Holdings Limited
100%
China National Aero-Technology
Corporation Shenzhen
58.77%
CATIC Shenzhen Holdings Limited
41.49%
Fiyta Holdings Ltd.
12
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
(4) Actual Controlling Shareholder to Control the Company through Trust or Other Assets
Management Approach
Inapplicable
4. Other legal person shareholders holding over 10% of the Company’s shares
Inapplicable
(IV) Convertible bonds
Inapplicable
V. Directors, supervisors and senior executives
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
(I) Change in Shares Held by Directors, Supervisors and Senior Executives
Does
Volume of he/she
stock receive
Number of Volume of
Volume of Number of options of any pay
shares shares Including:
shares sold shares held the or
Starting acquired at acquired volume of
Expiry date during the at end of the Company Cause of allowance
Names Positions Gender Age date of end of the during the restricted
of tenure reporting reporting held at the Change from the
tenure reporting reporting shares held
period(shar period end of the sharehold
period(shar period(shar (shares)
es) (shares) reporting ers or any
es) es)
period(shar other
es) related
parties?
Wu May 30, June 30,
Chairman male 50 0 0 0 0 0 0 Yes
Guangquan 2009 2012
June 22, June 30,
You Lei Director male 43 0 0 0 0 0 0 Yes
2010 2012
Chen May 30, June 30,
Director male 44 0 0 0 0 0 0 Yes
Hongliang 2009 2012
Xu Managing May 30, June 30,
male 46 0 0 0 0 0 0 No
Dongsheng Director 2009 2012
Wang May 30, June 30,
Director male 46 0 0 0 0 0 0 Yes
Mingchuan 2009 2012
Huang May 30, June 30,
Director male 38 0 0 0 0 0 0 Yes
Yongfeng 2009 2012
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FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Independen May 30, June 30,
Guo Wanda male 47 0 0 0 0 0 0 No
t director 2009 2012
Independen May 30, June 30,
Ji Qinzhi female 71 0 0 0 0 0 0 No
t director 2009 2012
Zhang Independen January 4, June 30,
male 47 0 0 0 0 0 0 No
Shunwen t director 2012 2012
June 22, June 30,
Sui Yong Supervisor male 54 0 0 0 0 0 0 Yes
2010 2012
Zhang May 30, June 30,
Supervisor male 59 0 0 0 0 0 0 No
Songhua 2009 2012
May 30, June 30,
Tang Boxue Supervisor male 51 0 0 0 0 0 0 No
2009 2012
Deputy GM
and 2009 年 07 June 30,
Chen Libin male 48 0 0 0 0 0 0 No
Secretary of 月 21 日 2012
the Board
Lu May 30, June 30,
Deputy GM male 51 66,311 0 0 66,311 49,733 0 No
Bingqiang 2009 2012
Deputy GM
May 30, June 30,
Li Dehua & Chief male 52 0 0 0 0 0 0 No
2009 2012
Accountant
May 30, June 30,
Li Bei Deputy GM male 57 0 0 0 0 0 0 No
2009 2012
May 30, June 30,
Fang Juan Deputy GM female 53 0 0 0 0 0 0 No
2009 2012
15
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Total -- -- -- -- -- 66,311 0 0 66,311 49,733 0 -- --
Equity Incentive Plan Granted to the Directors, Supervisors and Senior Executives in the Reporting period
Inapplicable
16
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
(II) Posts Held in Shareholders
Posts held in the firm of shareholders
Are
Posts held
Names of compensation
in the Starting
the Expiry date of and allowance
Names of the Firms of Shareholders firms of date of
post-holder tenure obtained from
sharehold tenure
s the firm of
ers
shareholders?
July 10,
CATIC Shenzhen Holdings Limited Chairman Up to now No
Wu 2003
Guangquan December
CATIC Shenzhen Company Limited Chairman Up to now No
16, 2008
July 10,
CATIC Shenzhen Holdings Limited Director Up to now No
2003
You Lei
General April 7,
CATIC Shenzhen Company Limited Up to now Yes
manager 2010
June 19,
CATIC Shenzhen Holdings Limited Director Up to now No
Chen 2012
Hongliang Deputy July 26,
CATIC Shenzhen Company Limited Up to now Yes
GM 2007
Chief
Wang September
CATIC Shenzhen Company Limited Accounta Up to now Yes
Mingchuan 13, 2010
nt
Huang Secretary of July 20,
CATIC Shenzhen Holdings Limited Up to now Yes
Yongfeng the Board 2012
Deputy September
Sui Yong CATIC Shenzhen Company Limited Up to now Yes
GM 13, 2010
Description
of the posts
held in the
firm of
shareholder
s
(III) Remuneration to Directors, Supervisors and Senior Executives
Procedures of Remuneration to directors and supervisors is reviewed and approved at the Companys
decision-making for general meeting of shareholders and remuneration to senior executives is reviewed and
the remuneration to approved the Board of Directors.
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2012 Semi-Annual Report, Full Text
directors, supervisors
and senior executives
The Company brought into full play and mobilized the senior executives work enthusiasm
and creativeness based on the Companys operating results and with reference to the
average remuneration level in the trade, better improved the Companys operating ability and
result and ensured realization of the Companys strategic targets. The Company worked out
the Measures for Administration of Remuneration to the Senior Executives in 2009, insisted
on the principle of distribution according to work and combination of power, responsibility and
Basis for
benefit. The major orientation was “market based”, “full amount based” and “broadband
Determining
based”Commencing from 2007 on, the Company has introduced Balance Scorecard
Remuneration to
Strategic Management Structure, based on the establishment of the incentive and
Directors, Supervisors
restriction mechanism adaptable to the modern enterprise system, improved the
and Senior Executives
corporate governance structure, decomposed the Companys strategy to every
department and post through the balance scorecard to determine senior executives
performance indicators and action plan on this basis, conducted regular strategic
review, work report and assessment on quarterly basis, and decided their total
remuneration and renewal of engagement according to the assessment results and
fulfillment of performances.
The Company practiced the annual salary system for its senior executives. The annual salary
structure consists of the basic annual salary and performance based annual salary. The
Actual payment of the
annual salary assessment for the GM was carried out according to the assessment methods
remuneration to
worked out by the shareholder. The assessment basis is mainly in accordance with a series
directors, supervisors
of indicators systems prepared based on the balance scorecard. The assessment for other
and senior executives
senior executives was conducted based on the indicators in the balance scorecard prepared
at year beginning and the work report at year end.
(IV) Change in Directors, Supervisors and Senior Executives
Inapplicable
(V) Employees
Total Number of the Incumbent Staff 4,921
Number of retirees whose expenses are undertook by the
25
Company
Professional Occupation
Number of Persons of Professional Occupation
Type of Professional Occupation
Production staff 402
Sales persons 4,121
Engineers and technicians 85
Financial personnel 136
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Administrative personnel 177
Education background
Classification of Education Background Number of persons
Senior middle school or lower 2,944
College graduates 1,230
Undergraduates 703
Masters 40
PhDs 3
Post-doctors 1
VI. Report of the Board of Directors
(I) Discussion and Analysis of the Management
During the first half year of 2012, affected by the overall weakness and gliding of the macro economy, the growth of the
domestic economy slowed down significantly and consumers purchase intention got weakened somewhat. Facing the
extremely unfavorable market environment, the Company continued to adhere to its philosophy, insisted on its business
values, focused on the two principal business lines, namely forging of HARMONY world watch channel brand and FIYTA
product brand, attached great importance on the market change, made positive response, carried out different forms of
sales activities, unceasingly explored various effective operation management measures and tried every means to
expand the sales and reduce the costs. As a result, the revenue grew continuously. However, restricted by continuous rise
of the labor costs, financing costs and operation expenses, there still exists unbalance between income and profit.
1. Retail of Famous Brand Watches
In the reporting period, the Company focused on Key=BSCin its Harmony world watch business, strengthened the
internal management, deepened the consutrction of “Three-Level Marketing” system, concentrated itself on the theme of
“profit, cash flow, benefit and efficiency”, strengthened comprehensive operatation management of shops according to the
work requirements of “high aspiration, high standard and high performance”, optimized the inventory structure, speeded
up inventory circulation, reduced expenditures and increased benefit and improved the operation efficiency of individual
shops; further enhanced the cooperative relationship with brands, channeles, etc., enthusiastically developed and
optimized the sales network in a steady way; positively overcame the tension upon the business arising from the
slackening of the economic growth, and devoted great efforts on continuous growth of sales performances.
Enthusiastically Expanding and Optimizing the Sales Network:
Based on the principle of steady development, the Company planned the network layout in a scientic way, optimized
investment projects from various dimensions of integration of strategic partnership, regions, brands, etc., improved the
investment benefit and reduced the investment risks; in addition, enhanced construction of new shop operation teams,
improved the earning power of the new shops and promoted the new shops to tide over the incubation period as soon as
possible. On the other hand, the Company has unceasingly optimized the existing retail network, strengthened the famous
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2012 Semi-Annual Report, Full Text
watch brands, improved the shop image, and provided consumers with more professional and comfortable shopping
space.
Strengthening Construction of HARMONY Brand:
The Company enthusiastically promoted HARMONY business brand from various dimensions, including advertisements
in national and local media, the Companys website, HARMONY WORLD as the VIP publication, construction of the
flagship shops, etc., improved the HARMONY brand favorite and continuously upgraded the value of HARMONY
business brand. In the reporting period, Harmony was promoted to China 100 Fashion Brands at TRENDS SUMMIT
CNINA 2012 and enjoyed good reputation in the industry and all walks of life. HARMONY was rewarded 2012 THE
VOYAGE OF MODERN NEW ERA awards for its 2011 Harmony Luxury Watches Exhibition.
Further strengthening the cooperation with brand owners:
The Company continued to strenthen the communication and cooperation with the main force and high-end international
wristwatch brands, spread the culture of watch by means of differenct activities, including high-level conferences,
high-end VIP saloon, theme culture exhibition, etc. and fostered and developed consumer groups.
Deepening three-level marketing and affiliating the customers:
The Company further implemented and practiced the principle of “three-level marketing”, reinforced the terminal sales
ability, vigorously carried various forms of sales contests and promotion activities. By means of a series of contests and
promotion activities including “Spring Flowers in Blossom”, “Abundant Midsummer”, “Auspicious Dragon Celebrating the
New Year”, “Singing Out I love you loudly”, “Graceful Driving Unit for Ladies”, “Fashionable Mothers Day”, “Brand Watch
Month in Summer”, etc., the Company devoted itself to create an expert-like sales team and improve the sales
performances; further affiliated the customers through questionnaires to mysterious customers, VIPs Appreciation
Activities , etc.; excavated the internal potentials by means of the activities of increasing income and reducing expenditure
and optimizing inventories; enthusiastically expanded and improved the after-sale service offices and offered high quality
after-sale services to the customers.
Enhancing organization construction, reinforcing team management and improving operation capability:
The Company made timely adjustment of the regional management framework so as to satisfy the business development
requirements; carried out knowledge management and best practice work in a deep-going way so as to improve the
employees technical ability. Based on the objective of creating a “high aspiration, high standard and high performance”
team, the Company carried out the training program for the employees at the production line, fulfilled 2011 Harmony Sales
Consultants Training and Certification work, persistently carried forward the implementation of the projects of “Future
Stars” and “LOHAS School”; enhanced talent team construction and reserve and training of cadres, introduced
management talents through various channels, continuously carried out experience-style learning exchange for chain
store managers, started annual basic-level managers 360 degrees leadership assessment and feedback tutorship work
on overall basis.
2. FIYTA Watches
In the reporting period, FIYTA Brand adhered to its cultural conception forward-looking and innovation, enthusiastically
pursued high-efficiency brand marketing strategy, unceasingly looked for various promotion models, tried every means to
improve the sales channels and improved the brand perception of the consumers. In the reporting period, the Company
kept a higher growth level of revenue and profit.
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Channel Expansion and Sales Contest:
The Company continued to enthusiastically implement its strategy of expanding the channels and promoted synchronious
improvement of quantity and quality of the channels with perfecting channel distribution and improving channel quality as
the goal, by means of vigorously developing outlets, franchised stores and comprehensive shops and enhancing the
management of individual shops, etc. In the reporting period, the Company carried out multi-theme sales contests with the
titles of “Passion Olympic and Infinite Possibility”, etc. With combination of festivals and holidays, such as the Spring
Festival, valentines day, Labor Day, etc., seeked for the support from channels to carry out promotion activities, and
ensured the retail business of FIYTA watches able to sustainably and quickly grow. Meanwhile, the Company vigorously
developed e-commerce business, group purchase and overseas business to support steady growth of the sales revenue.
Brand Price System and New Product Research & Development and Listing:
The Company continued to take high value-added products as the main brand identity products for promotion, sorted out
the price difference within and between series products, adjusted product price system according to the market feedback;
unceasingly enhanced research and development design and investment, attached importance upon product upgrading
and supplementation of competitive designs, continuously got rid of the stale and brought forth the fresh, vigorized the
brand, paid attention to the overall planning of the creative management, encouraged and supported new model design
conception. In the reporting period, the Company fulfilled the trial-manufacture and batch production task of Shenzhou IX
th
space watch series and woman space watches and was rewarded 12 China Patent Gold Award and Honorable Mention.
As a result, the brand identity and publicity have been upgraded.
Brand Promotion:
Aiming at the objective customer base, the Company communicated the core value of “perfect and supreme good
technology” and carried forward the public relation activities with the brand spokesperson and customers club as the base.
In the reporting period, the Company finished production of its first promotion film abroad, a fashion blockbuster titled
GAO Yuanyuan in Milan; successfully held a membership activity with the theme of “Singing and Enjoying from the Bottom
of Heart. In the activity, time, dream and music echoed each other. It has created a honorable customers experience for
the members of FIYTA Club. With the launch of Shenzhou IX Spaceship, the Company announced its up-to-date space
watch series by means of television advertising, print media and themed public relation activities and powerfully upgraded
the brand communication effect. Meanwhile, the Company successfully completed the journey of BASEL WORLD 2011
Watches. FIYTA, as the unique Chinese brand in the international exhibition hall, attracted much attention.
Reinforcing Team Construction:
The Company persistently reinforces talent fostering and training work for the purpose of developing a professional brand
team with high qualification, diligence and dedication, and powerful learning ability. In the reporting period, the Company
continued to enhance the development of brand talent team, recruited and trained outstanding talents based on the brand
development and requirements, and fostered management personnel reserve team by means of the improved talent
recruitment, training and incentive system, upgraded the qualification and capability of the shop assistants and
strengthened the cohesive force in enterprise. Meanwhile, the Company enhanced the sharing of internal information and
knowledge and quickly spread excellent practical experience in management and business for sharing.
Is the actual business performance over 20% lower or higher than that in the earnings projection or business
plan?
No
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2012 Semi-Annual Report, Full Text
Analysis on the Operation and Performances of the Principal Subsidiaries and Mutual Share-holding Companies:
1. Shenzhen Harmony World Watches Center Co., Ltd., whose business scope is purchase and sales of watches and
spares and accessory parts and repairing services. The Company holds 100% of its equity. In the reporting period, the
company realized total assets amounting to CNY 2,039.4913 million, total liabilities amounting to CNY 1,310.3656 million,
revenues amounting to CNY 1,193.8811 million and net profit amounting to CNY 32.8658 million.
2. FIYTA Sales Co., Ltd., whose business scope is design, R & D and sales of various watches, timing instruments and
spares and accessory parts, sales of jewelry and ornaments; import & export. The Company holds 100% of its equity. In
the reporting period, the company realized total assets amounting to CNY 76.3612 million, total liabilities amounting to
CNY 435.138 million, revenues amounting to CNY 241.4958 million and net profit amounting to CNY 11.2721 million.
3. Shenzhen FIYTA Sophisticated Timepieces Manufacture Co., Ltd., whose business scope is production various
watches and driving units, spares and accessory parts, sophisticated timepieces and repairing service. The Company
holds 100% of its equity. In the reporting period, the company realized total assets amounting to CNY 204.3048 million,
total liabilities amounting to CNY 158.6269 million, revenues amounting to CNY 169.4361 million and net profit amounting
to CNY 29.7237 million.
4. FIYTA Technology Development Co., Ltd. whose business scope is R & D, production and sales of watches, processing,
sales and technical development of sophisticated parts. The Company holds 100% of its equity. In the reporting period,
the company realized total assets amounting to CNY 70.8684million, total liabilities amounting to CNY 55.1067 million,
revenues amounting to CNY 35.2159 million and net profit amounting to CNY 0.812 million.
5. FIYTA Hong Kong Limited, whose business scope is trading and investment. The Company holds 100% of its equity. In
the reporting period, the company realized total assets amounting to CNY 217.0358 million, total liabilities amounting to
CNY 111.518 million, revenues amounting to CNY 58.7154 million and net profit amounting to CNY 4.0027 million.
6. Shenzhen Xiangji Commercial & Trade Co., Ltd., whose business scope is sales of watches and gifts and relevant
information consultation, and other domestic trade. The Company holds 100% of its equity. In the reporting period, the
company realized total assets amounting to CNY 26.8986 million, total liabilities amounting to CNY 26.0547 million,
revenues amounting to CNY 4.2232 million and net profit amounting to CNY –0.8256 million.
7. Shanghai Watch Industry Co., Ltd., whose business scope is sales of watches and parts. The Company holds 25% of
its equity. In the reporting period, the company realized total assets amounting to CNY 74.5002 million, total liabilities
amounting to CNY 44.2019 million, revenues amounting to CNY23.0391 million and net profit amounting to CNY 0.7655
million.
All risks which may result in unfavorable influence upon the Company’s future development
strategy and the realization of the business objectives:
1. Market risk arising from the continuous declining and weak macro economy;
2. Market competition and financial pressure to be confronted with in process of channel construction;
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2012 Semi-Annual Report, Full Text
3. Cost pressure arising from continuous rise of the labor costs, financing costs and operation costs.
1. Principal Business and Operation
(1) Principal business based on industries and products
in CNY
Year-on-year Year-on-year
Year- on-year
increase/decr increase/decr
Industries or Operating Gross profit increase/decr
Revenue ease of ease of
products costs rate (%) ease of gross
operating operating
profit rate (%)
income (%) costs (%)
Industries
1,173,543,91 874,237,801.
Commerce 25.5% 19.11% 19.5% -0.24%
6.34 34
265,901,475. 99,165,431.9
Manufacture 62.71% 30.46% 31.15% -0.19%
21 2
Property 34,705,360.1 10,394,436.1
70.05% 0.87% -1.16% 0.62%
Operation 4 0
Products
Sales of
foreign 1,173,543,91 874,237,801.
25.5% 19.11% 19.5% -0.24%
famous 6.34 34
watches
Sales of
265,901,475. 99,165,431.9
FIYTA 62.71% 30.46% 31.15% -0.19%
21 2
watches
Property 34,705,360.1 10,394,436.1
70.05% 0.87% -1.16% 0.62%
Operation 4 0
Note to causes of bigger increase/decrease rate of the gross profit over the same period of the previous year
Inapplicable
(2) Distribution of the Principal Business in Various Regions
in CNY
Year-on-year increase/decrease of
Regions Revenues
revenues (%)
Northeast China 139,682,464.71 20.2%
North China 292,156,396.04 27.83%
Northwest China 331,183,745.81 11.25%
Southwest China 110,244,661.48 33.91%
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2012 Semi-Annual Report, Full Text
East China 182,965,167.64 22.87%
South China 417,918,316.01 19.48%
(3) Note to the Causes of the Significant Change in Principal Business and its Structure
Inapplicable
(4) Note to the Causes of the Material Change in the Earning Capacity (Gross Profit Rate) of the
Principal Business over the Previous Year
Inapplicable
(5) Analysis on Reasons of Big Change in Profit Composition over the Previous Year
Inapplicable
(6) Business nature, principal products or services and net profit, etc. of the mutual
share-holding companies whose net profit the Company takes over 10%
Inapplicable
(7) Problems and Difficulties in Operation
2. Internal Control System in Connection with the Measurement with the Fair Value
Inapplicable
3. Financial Assets and Financial Liabilities in Foreign Currencies Held by the Company
Inapplicable
(II) Investment
1. General Application of the Raised Capital
CNY 10,000
Total raised capital 48,277
Total raised capital invested in the reporting
347
period
Total raised capital accumulatively invested 48,277
Total raised capital whose application has been
0
changed in the reporting period
Total raised capital whose application has been 0
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2012 Semi-Annual Report, Full Text
changed accumulatively
Proportion of the total raised capital whose
0
application has been changed accumulatively
Note to Application of the Raised Capital
Ended June 30, 2012, all the raised capital had been used up.
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2012 Semi-Annual Report, Full Text
2. Promised Projects of Raised Capital
CNY 10,000
Has the Amount Investment Date when Has
Total
project Total Amount accumulativ progress by the project Result Has the significant
promised
Promised investment projects been investment invested in ely invested the end of has realized in predicted change
investment
and investment of the changed after the up to the the reached the the operation taken place
with
over-raised capital (including adjustment reporting end of the reporting predicted reporting result been in the
raised
partial (1) period reporting period (%) applicable period reached? feasibility of
capital
change) period (2) (3) = (2)/(1) status the project?
Investment projects as
promised
1. HARMONY World Watch
Chain Network Development No 41,000 41,000 1,460 41,000 100% Yes No
and Improvement Project
2. Project of putting new FIYTA
No 5,000 5,000 0 5,000 100% Yes No
watches to the market
3. FIYTA Brand Marketing and
No 4,000 4,000 610 4,000 100% Yes No
Promotion Project
Sub-total of investment
- 50,000 50,000 2,070 50,000 - - - -
projects as promised
Investment with over-raised
capital
Repayment of bank loan (if - - - - -
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2012 Semi-Annual Report, Full Text
any)
Supplementing working
- - - - -
capital (if any)
Sub-total of investment with
- - - - -
over-raised capital
Total - - - - -
Note to failure to comply with
the planned progress and
predicted earnings and the Inapplicable
cause(s) (based on the specific
projects)
Explanation of the significant
Inapplicable
change in project feasibility
Amount of over-raised capital, Inapplicable
application and progress of
use
Change of the implementation Inapplicable
site of the projects invested
with the raised capital
Adjustment of the Inapplicable
implementation method of the
projects invested with the
raised capital
About the initial investment in
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2012 Semi-Annual Report, Full Text
the projects planned to be The Proposal on Replacement of the Self-raised Fund Invested in the Project Which should be Invested with the Raised Capital as reviewed and
th
invested with the raised capital approved at the 19 meeting of the Sixth Board of directors held on December 20, 2010 was approved to replace CNY 164,703,186.65 of the
and the replacement self-raised fund in the project which should be invested with the raised capital amounting to CNY 164,703,186.65. The fund replacement was
completed on January 4 and 5, 2011.
About provisional Inapplicable
supplementation of the
working capital with the idle
raised capital.
Amount of balance of the Inapplicable
raised capital incurred in
process of implementation of
the project and the cause
Application and status of the
Inapplicable
unused raised capital
Application of the raised capital
and problems existing in the Inapplicable
disclosure or other conditions
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2012 Semi-Annual Report, Full Text
3. Chang of the projects invested with the raised capital
Inapplicable
4. Significant Projects Invested with Non-Raised Capital
in CNY 10,000
Date of the
initial
disclosure Project
Projects Project progress Earnings
by amount
announcem
ent
The Company
accepted 100% equity
in Hengdarui Co. from
CATIC Trust
Acquisition of the Equity in
Co.Ended June 30,
Liaoning Hengdarui
2012, the Company
Commerce & Trade Co., Ltd. December
5,610 had paid CNY 56.10 -91.13
by Shenzhen Harmony World 15, 2011
million of the
Watches Center Co., Ltd.
consideration of the
equity assignment
and the procedures
for change of the
equity was completed.
Ended June 30, 2012,
the Company had
paid CNY 40.30025
million of the
consideration of the
The Company invested 25%
December equity assignment to
equity in Shanghai Watch 4,030.025 19.14
15, 2011 Beijing Equity
Industry Co., Ltd.
Exchange Co., Ltd.
and the procedures
for change of the
equity was completed
Total 9,640.025 -- --
Note to the Material Projects Invested with Non-raised Capital
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2012 Semi-Annual Report, Full Text
(III) Plan of the Board of Directors for Amendment of the Operation Plan in the
Second Half Year
Inapplicable
(IV) Prediction of the Operation Performances from January to September 2012
Prediction of the possibility of the accumulated net profit from the year beginning to the end of the next reporting period
being of loss; or warning for big changes in the net profit in comparison with the same period of the previous year and the
reasons
Inapplicable
(V) Explanation of the Board on the Qualified Auditor’s Report Issued by CPAs
Inapplicable
(VI) Explanation of the Management on the Changes and Handling of the Issues
Involved in the Qualified Auditor’s Report Issued by CPAs in the Previous Year
Inapplicable
(VII) Statement of the Board of Directors on the Company’s Accounting Policy,
Results of the Discussion on Change of the Accounting Estimation or Cause of
Correction of Significant Accounting Error and the Influence
Inapplicable
(VIII) Preparation and Implementation of the Cash Dividend Distribution Policy
According to the provisions concerning cash dividend distribution in the Articles of Association, the Company prepared
specific cash dividend distribution plan after the Board of Directors and the Shareholders General Meeting have reviewed
strictly according to the requirements. In the past three years, the Company has well implemented the cash dividend
distribution policy, fully asked for the independent directors opinions, effectively ensured the minority shareholders benefit
and made timely and accurate disclosure in its annual report and the relevant media. In 2009, the Company distributed
cash dividend amounting to CNY 24,931,799.90 (with tax inclusive), taking 35.58% of the net profit in the consolidated
statement attributable to the shareholders of the Company; in 2010, the Company distributed cash dividend amounting to
CNY 28,054,847.90 (with tax inclusive), taking 29.85% of the net profit in the consolidated statement attributable to the
shareholders of the Company; in 2011, the Company distributed cash dividend amounting to CNY 39,276,787.00 (with tax
inclusive), taking 24.63% of the net profit in the consolidated statement attributable to the shareholders of the Company. In
the past three years, the accumulative amount of cash dividend distributed takes 85.56% of the annual average net profit
in the latest year, which complies with the rules and regulations.
According to the Circular of China Securities Regulatory Commission and Shenzhen Securities Regulatory Office on
Careful Implementation of the "Notice of Further Implementing Requirements for Cash Dividend Distribution of Listed
rd
Companies", for the purpose of better protection of the investors benefit, the Company held 33 Meeting of the Sixth
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Board of Director on June 19, 2012, and reviewed and approved the Proposal on Amendment of the Articles of
Association according to which the provisions concerning cash dividend distribution in the existing Articles of Association
rd
have been amended accordingly. For the detail, refer to the Announcement of the Resolution of the 33 Meeting fo the
Sixth Board of Directors (2012-014). The Proposal on Amendment of the Articles of Association was reviewed and
st
approved at 2012 1 General Meeting of Shareholders. The Company shall continue to implement the work concerning
cash dividend distribution according to the amended Articles of Association and the concerned provisions. The Company
shall further prepare reasonable cash dividend distribution system according to its business development conditions with
consideration of the requirements of the Articles of Association, attaches importance on return to the shareholders and
devotes itself to create more return to the shareholders.
(IX) Profit Distribution Proposal Or The Plan For Converting Capital Reserve To
Bonus Shares
Inapplicable
(X) About Failure to Propose Cash Dividend Distribution Plan with the Accumulative
Retained Profit at the End of 2011 as Positive
Inapplicable
(XI) Other Information Necessary to be Disclosed
Inapplicable
(XII) About the Company’s Liabilities, Change of Credit Standing and Cash
Arrangement for Debt Repayment in the Future Year (This form is only to be filled in
by a listed company which has issued convertible bonds).
Inapplicable
VII. Important Events
(I) About the Corporate Governance
I. Actual Situation of the Corporate Governance in the Reporting Period
The Company continuously improved the Companys corporate governance structure strictly according to the PRC
Company Law, the PRC Securities Law and the regulations of China Securities Regulatory Commission concerning
governance of listed companies, and tried to enhance construction of modern enterprise system, upgraded the level of
regulatory operation of the Company. As a result, there was no discrepancy between the situation of the Companys
corporate governance and the regulatory documents of China Securities Regulatory Commission concerning governance
of listed companies.
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The Company established and improved relatively standardized corporate governance structure and rules of procedures,
formed a decision-making and operation management system with the Shareholders Meeting, the Board of Directors, the
Supervisory Committee and the management of the Company as the principal structure. They implemented their
respective duties according to the PRC Company Law and the Articles of Association.
The General Meeting is the Companys supreme organ and has the power of deciding the Companys operation policy
and investment plan, reviewing and approving the Companys annual fincial budget scheme, settlement scheme, profit
distribution plan, loss make-up plan, change of the application of the proceeds raised through issuing, etc., makes
resolution on increase and decrease of the Companys registered capital, issuing bond, etc., election and replacement of
directors, non-staff supervisors and decision on their remuneration and way of payment.
The Board of Directors is the Companys decision-making organ, takes charge of implementing the decisions made by the
Shareholders General Meeting, assumes responsibility to the Shareholders General Meeting and reports the work to it;
within the authorization from the General Meeting, decides the Companys external investment, acquisition and sales of
assets, assets pledgement, external guarantee, related transactions, etc., decides establishment of the Companys
internal management organs, engagement and disengagement of the Companys general manager, the Board secretary
and other senior executives, etc. The Board of Directors consists of nine directors, including three independent directors.
The Board of Directors has established three subordinate special committees, namely the Strategy Committee, the Audit
Committee and Nomination, Emolument and Assessment Committee.
The Supervisory Committee is the Companys supervisory organ in charge of supervising the directors, managers and
other senior executives in performaning duties according to the law and proposes dismissal of any director or senior
executive who breaches the law, the administrative rules and regulations, the Articles of Association or the General
Meetings resolutions. The Supervisory Committee consists of three supervisors including two staff supervisors.
The management assumes responsibility to the Board of Directors and the General Manager takes full responsibility for
the Companys routine operation and management and development under the leadership of the Board of Directors,
supervises the work of every functional department, assesses the work result of each functional department and
coordinate the relationship of all departments.
II. Incompliance Practice in the Corporate Governance in the Reporting Period
As a company controlled by a central enterprise in equity, in accordance with the regulations concerning management of
the state-owned assets, there existed undisclosed information, including financial statements, submitted to the principal
shareholder and actual controller in the Company in the reporting period. While demanding the responsible persons to
abide by the duty of keeping confidential, the Company submitted the monthly financial news and the quarterly financial
statements to its controlling shareholder after completion of the procedures of review and approval, submitted the name
list of shareholders on quarterly basis to the biggest shareholder and submitted monthly operation information to the
actual controller.
In accordance with the Circular on Enhancing Supervision over Listed Companies Activity of Providing Undisclosed
Information to their Principal Shareholders and Actual Controllers and the Supplementary Circular on Enhancing
Supervision in Governing Listed Companies Non-regulatory Activities, such as Providing Undisclosed Information to their
Principal Shareholders and Actual Controllers promulgated by Shenzhen Securities Regulatory Office, the Company has
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implemented necessary procedures of reporting and filing and has submitted the conditions of reporting the undisclosed
information and the name list of insiders to Shenzhen Securities Regulatory Office. The Company attaches great
importance on keeping confidential the undisclosed information as submitted. In the reporting period, there was no such
event that caused the price fluctuation of the Companys stock due to disclosure of the undisclosed information in the
reporting period.
In the reporting period, the Company had not been involved in such practice as accepting engagement and
disengagement of the Companys senior executives and middle level executives or auditing the specific projects of the
Company and its subsidiaries, review and approval of the Companys asset acquisition or external investment projects, or
such incompliance practice in administration as practicing ownership representative reporting system, etc. from the
principal shareholder or eventual controller.
III. Progress of Implementation of the Company’s Internal Control
With a view to implementing the Implementation Guidelines for Enterprise Internal Control and the relevant supplementary
guiding work and according to the circular of China Securities Regulatory Commission and Shenzhen Securities
Regulatory Office, the Company officially started the Project of Compliance with the Implementation Guidelines for
Enterprise Internal Control (hereinafter referred to as the “Internal Control Project”). In the reporting period, the Company
implemented the internal control projects orderly according to the steps as specified in the Statement of the
Implementation Progress of the 54 Experimental Companies for the Rules for Enterprise Internal Control in the
Jurisdiction of Shenzhen with reference to the Work Guides for the Key Experimental Companies in the Jurisdiction of
Shenzhen in Implementing the Rules for Enterprise Internal Control; and made self assessment on the design of the
internal control and effectiveness of the operation ended June 30 2012. (For the detail, refer to the Self-Assessment
Report on the Internal Control of 2012 Semi-annual Report of FIYTA Holdings Limited).
In the reporting period, the Company established the internal control on the business and matters which have been put in
the assessment range, which has been effectively implemented and has reached the target of the Companys internal
conrol. There exists no material defect.
No significant change has taken place in the internal control resulting in substantial affect upon the assessment
conclusion during the period from the base date of the internal control assessment report to the date of issuing the internal
control assessment report.
In the second half year of 2012, the Company shall continue to improve the internal control system applicable to the
Company according to the relevant law and regulations, the Companys basic rules on the internal control and the
supporting guidelines; appoint the CPAs engaged in the internal control audit and conclude agreement on internal control
audit with the CPAs, where both Parties respective rights and obligations shall be specified, arrange te auditors to enter
the site to carry out the internal control audit work and make communications on the key issues found in the internal
control audit; generalize the internal control construction achievements to the Companys other major business modules
and frontline operation units.
(II) Profit Distribution Plan, Plan for Converting Public Reserve into Share Capital or
Plan for Issuing New Shares Prepared in Previous Period but Implemented in the
Reporting Period
On February 23, 2012, the Company held 31st Meeting of the Sixth Board of Directors, reviewed and approved 2011 Profit
33
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Distribution Proposal. The proposal was finalized after review and approval at 2011 Annual General Meeting held on April
12 2012. According to the proposal, with 392,767,870 shares of the total share capital as at December 31, 2011 as the
base number, the Company distributed cash dividend to the whole shareholders at the rate of CNY 1.00 (with tax inclusive)
for every 10 shares and the total amount of the cash dividends distributed was CNY 39,276,787.00. The profit distribution
proposal complied with the the relevant regulations and the Articles of Association in terms of preparation, review and
implementation procedures. The profit distribution was completed in implementation on June 1, 2012. (For the detail, refer
to the Announcement on Implementation of Equity Distribution for the Year 2011 (2012-013).
34
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
(III) Lawsuits and Arbitrations
Inapplicable
In the reporting year, the Company had never been involved in any material lawsuit or arbitration.
35
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
(IV) Bankruptcy or Reorganization Related Events
Inapplicable
(V) The Company did not hold any equity in other listed companies or investment in
the equity in any financial enterprises.
1. Investment in Securities
Inapplicable
2. Equity in other listed companies held by the Company
Inapplicable
3. Equity in non-listed financial enterprises held by the Company
Inapplicable
4. Trading of shares in other listed companies
Inapplicable
(VI) Asset Transactions
36
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
1. Acquisition of Assets
Inapplicable
2. Sales of Assets
Net profit of
the assets
contributed
Proportion of
to the
Has the the net profit Association
Company Has the Date of the
Trading Price Gain/loss ownership contributed with the trade
Other Party from the Related Asset sales credit/debts provisional
(in resulted from of the assets by sale of the counterpart
of the Assets Sold Date of sale beginning of Transactions pricing involved disclosure by
CNY10,000) the sales (in involved asset in the (applicable to
Transaction the reporting (Y/N) principle been all announceme
CNY 10,000 ) been Companys related
period to the transferred nt
transferred? total profit transaction)
date of sale
(%)
(in
CNY10,000)
The carrying
45% equity in
Shenzhen amount of the
Northwestern
Northwestern net assets of
Polytechnical
Industrial Northwestern
University February 23, February 28,
Technology 165 0 -21.36 No Polytechnical No No 0.33% Inapplicable
Shenzhen 2012 2012
Research University
Research
Insitute Co., Shenzhen
Institute
Ltd. Research
Institute as at
37
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
September
30, 2011 was
taken as the
pricing basis
for the equity
assignment
Note to the Sales of Assets:
Northwestern Polytechnical University Shenzhen Research Institute, as a legal person institution, was incorporated in June 2002 with the start-up capital for CNY 3 million. Its
shareholders were Northwestern Polytechnical University and Fiyta Holdings Limited and both parties held 55% and 45% of the equity respectively. Its business purposes and scope
were: to carry out high-level talent training, science and technology cooperation and development, conversion of the research results, set up hi-tech enterprises and serve Shenzhen;
non-diploma continuing for professionals at postgraduate level or higher of machine-building, electronics, computer, information, management, software, motive power, transportation,
environment, conrol, materials, chemicals, civil engineering, aviation and space navigation, etc.; scientific research, academic exchange, conversion of research achievements of the
relevant discipline. Northwestern Polytechnical University Shenzhen Research Institute has promoted development of hi-tech enterprises in Shenzhen by means of its superiority in
talents and technology, carries oiut continuing education for the Company and other hi-tech manufacturers in Shenzhen and high-level talents training.
In consideration of the difference in management conception and way of operation between a school and an enterprise, especially a listed company, for the benefit of both parties
independent operation and development, after mutual consultation of both parties, the Company assigned its 45% in Shenzhen Northwestern Industrial Technology Research Insitute
Co., Ltd. with consideration of CNY 1.65 million (CNY One Million Six Hundred and Fifty Thousand only) with the carrying amount of the net assets of Northwestern Polytechnical
University Shenzhen Research Institute as at September 30, 2011 taken as the pricing basis for the equity assignment.
3. Exchange of Assets
Inapplicable
38
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
4. Enterprise Consolidation
th
The 29 Meeting of the Sixth Board of Directors of FIYTA Holdings Ltd. held on December 14, 2011 approved Proposal on
Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World Watches
Center Co., Ltd. and the Extraordinary Shareholders Meeting held on January 4, 2012 reviewed and approved the
Proposal on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World
Watches Center Co., Ltd. According to the Agreement on Assignment of the Equity to the Third Party and the Contract
on Equity Assignment, the Company paid CNY 28.05 million, the balance of the payment for the equity acquired equal to
50% of the total payment in February, 2012; the total payment involved in the equity acquisition was CNY 56.10 million. By
then, the Company had finished acquisition of 100% equity in Hengdarui. As the three parties participated in the
assignment of the equity, namely the Company, CATIC Shenzhen Company Limited (“CATIC Shenzhen”), the Companys
actual controlling shareholder, and CATIC Trust Co., Ltd. are related parties. Therefore, in the reporting period, Hengdarui,
as an enterprise under common control, has been included in the consolidated statement range and the consolidation
date was February 28, 2012.
5. Progress of the assets reorganization or assets acquisition/sale activities after the assets
reorganization report or notice on assets acquisition/sale was published and the impact of such
activities upon the Company’s operation result and information position in the reporting period
Inapplicable
(VII) Note to the share acquisition plan proposed or implemented by the Company’s
holding shareholder and its concerted actor in the reporting period
Inapplicable
(VIII) Implementation of the Company’s equity incentive plan and the influence
arising therefrom
Inapplicable
(IX) Material Related Transactions
39
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
1. Related transactions in connection with daily operation
Related transactions in connection with daily operation
Products purchased and labor services received from the related Products purchased and labor services received from the related
parties parties
Related Parties
Amount in transaction (in CNY Proportion in the amount of the Amount in transaction (in CNY Proportion in the amount of the
10,000) similar transactions (%) 10,000) similar transactions (%)
Aviation Industry Corporation 388.7 0.26%
Rainbow Supermarket 3,615.82 2.45% 1,062.24 5.92%
SHENNAN Circuit 79.07 0.05%
CATIC Property 118.01 3.4% 59.29 100%
Ganzhou CATIC Real Estate
0 0% 33.77 1%
Development Co., Ltd.
CATIC Real Estate 99.22 2.86%
Makway 26.56 0.77%
CATIC Securities 44.73 1.29%
CATIC CITY Property 1.09 0.03%
CATIC City Development 1.09 0.03%
GUANLAN Real Estate 4.36 0.13%
CATIC Changtai 62.73 1.81%
Grand Skylight Hotel Co. 175 5.04%
Rainbow Supermarket 18.3 0.53%
CATIC Supervision Co. 8.71 0.25%
40
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
CATIC Real Estate Development 4.39 0.13%
Jiufang Assets Co. 18.18 0.52%
Grand Skylight Hotel Co. 11.82 0.34%
Total 4,677.77 1,231.53
Where: In the reporting period, the related transactions in connection with sales of products or supply of labor services to the controlling shareholder or its subsidiaries amounted to
CNY 46.7777 million.
2. Related transactions concerning assets acquisition/sales
Inapplicable
3. Important Related Transitions with Joint Investments
Inapplicable
4. Current Related Rights of Credit and Liabilities
Did there exist any non-operational related rights of credit and liabilities
No
Amount of capital provided to the related party (in CNY Amount of capital provided by related parties to the
10,000) Company (in CNY 10,000)
Related Parties Relationship Amou Amo Interes Amou Amo Interes Intere
Interest
Opening nt unt of Ending t Opening nt unt of Ending t st
payme
balance incurre repay balance incom balance incurre repay balance incom paym
nt
d tment e d tment e ent
41
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Non-operational
Inapplicable
Sub-total
Operational
Common 4,234. 4,063
Rainbow Supermarket 63.58 234.32 6 0 0 6
controller 01 .27
Eventual
AVIC 12.18 46.5 51.86 6.82 0 119.89 56.87 63.02
controller
Common 173.2
Shennan Circuit 159.47 92.51 78.74
controller 4
Zhonghang Electronic Measuring Common
4.07 0 0 4.07
Instruments Co., Ltd controller
Xian Zhongfei Aviation Testing Common
0 200 0 200
Technology Development Co., Ltd. controller
Common
CATIC Trust Co. 2,805 0 2,805 0
controller
Common
CATIC Decoration Co. 13.2 0 13.2 0
controller
Shenzhen CATIC Enterprise Group Common
0 18.96 0 18.96 0 3.96 0 3.96
Training Center controller
Common
CATIC Monitor 10.25 0 0 10.25
controller
Common
Ganzhou CATIC Real Estate Co. 12.27 33.77 33.77 12.27
controller
42
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Common
CATIC Building 0.82 0 0 0.82
controller
Common
CATIC Nanguang 0.34 0 0 0.34
controller
Common
CATIC Property Management Co. 0 73.97 59.29 14.68
controller
Common
CATIC Real Estate Development 8.58 4.81 3.77
controller
Common
CATIC CITY Development 10.73 10.73 0
controller
Common
CATIC Securities 15 0 0 15
controller
Common
Makway 6.46 0 0 6.46
controller
Common
CATIC Real Estate 42.48 0 0 42.48
controller
CATIC Changtai Investment Common
0 62.73 62.73 0 0 22.17 22.17
Development controller
CATIC City Property 10.73 10.73 0
4,688. 7,203 142.4
Sub-total 3,080.02 565.43 101.14 219.99 178.7
48 .07 3
4,688. 7,203 142.4
Total 3,080.02 565.43 101.14 219.99 178.7
48 .07 3
Amount of capital provided by the Company to its
0
controlling shareholder and subsidiaries in the reporting
43
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
period (in CNY)
Including: Amount of capital for non-operational purpose
(in CNY 10,000) 0
Balance of capital provided by the Company to its
0
controlling shareholder and subsidiaries (in CNY 10,000)
Including: balance for non-operational purpose (in CNY
0
10,000)
Cause for occurrence of related rights of credit and
Inapplicable
liabilities
Liquidation of related associated rights of credit and
Inapplicable
liabilities
ommitment relevant to associated rights of credit and
Inapplicable
liabilities
Impacts of related rights of credit and liabilities on the
Inapplicable
company's business results and financial positions
Status and returning scheme on occupied funds in the reporting period
Inapplicable
Ended the reporting period, if the listed company has not finished the returning scheme on non-operational occupied funds and the responsibility investigation plan proposed by the
Board of Directors.
Inapplicable
44
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
5. Other Related Transactions
Inapplicable
(X) Important Contracts and Implementation
1. Custody, contract or lease from which the profit brought about takes over 10% (with 10%
inclusive) of the Company’s total profit
(1) Custody
Inapplicable
(2) Contract
Inapplicable
(3) Lease
Inapplicable
2. Guarantee
in CNY 10,000
External Guarantees Offered by the Company (excluding that to the Subsidiaries)
Date of
announce Date of actual Guarant
ment for occurrence Amount of Complet ees for
Guarantee Guarantee
Guarantees disclosure (date of actual Types ed?(Y/N Related
quota Term
of signing the guarantee ) Parties?
guarantee agreement) (Y/N)
quota
Inapplicable
Total external guarantee quota Total amount of external
approved in the reporting period 0 guarantee incurred in the 0
(A1) reporting period (A2)
Total external guarantee quota Total balance of actual external
approved at the end of the 0 guarantee at the end of the 0
reporting period (A3) reporting period
Guarantees to the Subsidiaries
Date of Guarantee Date of actual Amount of Guarantee Complet Guarant
Guarantees Types
announce quota occurrence actual Term ed?(Y/N ees for
45
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
ment for (date of guarantee ) Related
disclosure signing the Parties?
of agreement) (Y/N)
guarantee
quota
Shenzhen Harmony
February
World Watches 6,000 June 26, 2012 3,500 guarantee 2 years No No
28, 2012
Center Co., Ltd.
Total amount of guarantee to
Total external guarantee quota to
the subsidiaries actually
the subsidiaries approved in the 100,000 3,500
incurred in the reporting period
reporting period (B1)
(B2)
Total balance of actual
Total guarantee quota to the
guarantee to the subsidiaries
subsidiaries approved at the end of 100,000 12,083
at the end of the reporting
the reporting period (B3)
period
The Companys total guarantee (i.e. total of the first two main items)
Total amount of guarantee
Total guarantee quota approved in
100,000 actually incurred in the 3,500
the reporting period (A1+B1)
reporting period (A2+B2)
Total guarantee quota already Total balance of the actual
approved at the end of the 100,000 guarantee at the end of the 12,083
reporting period (A3+B3) reporting period (A4+B4)
Proportion of the actual guarantees in the Companys net assets
8.65%
(namely A4+B4)
Including:
Amount of guarantees offered to the shareholder, ultimate controller
0
and related parties (C)
Amount of guarantee as liability security offered directly or indirectly
0
to the guarantees whose asset-liability rate exceeding 70% (D)
Guarantee with total amount exceeding 50% of the net assets (E) 0
Total amount of the aforesaid three guarantees (C+D+E) 0
Description of the possibility of bearing joint repayment liability due
Inapplicable
to undue guarantee
Description of external guarantee against the specified procedures Inapplicable
46
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
3.Information of consigned financing
Inapplicable
4. Implementation of Important Contracts in Normal Business
Inapplicable
5. Other Important Contracts
Inapplicable
(XI) Description of Issuing Corporate Bonds
In accordance with the concerned laws, rules and regulations, including the Company Law of the Peoples
Republic of China, the Securities Law of the Peoples Republic of China, Measures for Pilot Projects for the
Offering of Corporate Bonds, after self-inspection, the Company considers that it has complied with the conditions
for issuing corporate bonds. For the purpose of replenishing the Companys working capital, speeding up
development of the Companys principal business, further improving the Companys liabilities structure, the
rd
Company held the 33 meeting of the Sixth Board of Directors on June, 19 2012. The meeting reviewed the
st
Proposal for Issuing Cororate Bonds which was approved at 2012 1 Extraordinary Shareholders Meeting. The
size of the corporate bonds to be issued would not exceed CNY 400 million with the bond term not exceeding 5
years. The issuing plan has been submitted to China Securities Regulatory Commission and has not yet been
approved yet.
(XII) Performance Of Commitment
1. Commitments of the Company or the Shareholder Holding over 5% of the Company’s
Shares or the Commitments Extended to the Reporting Period
Commit
Commitment Implementati
Commitments Acceptors Description ment
term on
time
(1) CATIC Implementati
Shenzhen on of the
Holdings Limited commitment:
committed that The
upon completion Novemb commitment
Commitment for Equity Separation CATIC
of FIYTA equity er 9, - is in process
Reform Shenzhen
separation 2007 of
reform, the implementati
non-negotiable on.
shares held by Commencin
CATIC Shenzhen g from the
47
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Corporation date when
would not be the equity
listed with the separation
trading system of reform was
Shenzhen Stock fulfilled to the
Exchange for sale end of the
within 36 months reporting
commencing from period,
the date when CATIC
such shares got Shenzhen
approval for Holdings
listing; (2) Within Limited has
24 months after not reduced
the 3-year sales or assigned
restriction term any
expires, in case restricted
CATIC Shenzhen shares held
Holdings Limited byCATIC
would sell the Shenzhen
non-negotiable Holdings
FIYTA shares it Limited.
was holding
through listing
with Shenzhen
Stock Exchange,
the sales price
must not be lower
than CNY 25.00
per share.
Commitments in the acquisition
report or the written report on change - - - -
of equity
Commitment made at the time of
- - - -
asset exchange
Commitment of Status of
CATIC Shenzhen: implementati
Within 36 months on of the
commencing from December commitment:
Decemb
CATIC the end of the 30 2010 to The
Commitment at the time of issuing er 30,
Shenzhen Companys December commitment
2010
non-public issuing 29, 2013 is in process
(from December of
30, 2010 to implementati
December 29, on.
48
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
2013), CATIC
Shenzhen shall
not assign any of
the new shares it
has subscribed.
Other commitments to the minority
shareholders
Has the commitment been timely
√ Yes
implemented?
The specific cause of failure in
Inapplicable
implementation and the next plan
Is there any commitment for the issue
which may lead to horizontal Inapplicable
competition and related transaction
Term of solution as committed Inapplicable
Way of solution Inapplicable
Performance of commitment Inapplicable
2. There existed profit anticipation for the Company’s assets or projects while the
reporting period was still within the duration of the profit anticipation. The Company made
explanation on whether the assets or projects reached the anticipated profit and the cause
Inapplicable
(XIII) Items of Other Comprehensive Income
In CNY
Items Reporting period Previous period
1. Amount of gain/loss arising from available-for-sale financial
assets
Less: Influence upon income tax from available-for-sale
financial assets
Net gain/loss previously recorded in other comprehensive
gains transferred to the current gain/loss
Sub-total
2. The share calculated according to the equity method and
enjoyed in the other comprehensive income of the investee
Less: Influence upon the income tax arising from the share
calculated according to the equity method and enjoyed in the
other comprehensive income of the investee
49
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Net gain/loss previously recorded in other comprehensive
gains transferred to the current gain/loss
Sub-total
3. Amount of gain/loss arising from the cash flow hedge
instrument
Less: Influence upon income tax arising from the cash flow
hedge instrument
Net gain/loss previously recorded in other comprehensive
gains transferred to the current gain/loss
Amount of adjustment of the amount transferred into the hedge
item recognized initially
Sub-total
4. Converted difference in Foreign Currency Statements -1,490,601.91 2,071,076.23
Less: Net in disposal of overseas operation transferred to the
current gain/loss
Sub-total -1,490,601.91 2,071,076.23
5. Others
Less: Influence upon the income tax arising from others
recorded in the other comprehensive income
Net of the gain/loss recorded previously in the other
comprehensive gains transferred to the current gain and loss
Sub-total
Total -1,490,601.91 2,071,076.23
(XIV) Statement of such activities as reception, research, communication,
interview in the reporting period
Reception Discussion topics and provision
Reception Time Way of reception Types of Visitors Visitors received
place of materials
Development trend of the
China Southern
domestic luxury goods sector,
Fund Management
some measures concerning the
Co., Ltd., Guotai
Companys strategic
Junan Securities
development, brand
February 28, 2012 Company On-Site Survey Organization Co., Ltd., Guosen
construction, terminal
Securities Co., Ltd.,
management in the past three
China International
years. Provision of the
Fund Management
Companys public brochures in
Co., Ltd.,
2012.
March 1, 2012 Company On-Site Survey Organization Industrial Securities Development trend of the
50
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Co., Ltd. FrankLin domestic luxury goods sector,
Templeton Sealand some measures concerning the
Fund Management Companys strategic
Co., Ltd. development, brand
construction, terminal
management in the past three
years. Provision of the
Companys public brochures in
2012.
Development trend of the
domestic luxury goods sector,
some measures concerning the
Everbright Securities
Companys strategic
Co., Ltd. and
development, brand
March 15, 2012 Company On-Site Survey Organization Changan Fund
construction, terminal
Management Co.,
management in the past three
Ltd.
years. Provision of the
Companys public brochures in
2012.
Development trend of the
domestic luxury goods sector,
some measures concerning the
Companys strategic
Sinolink Securities development, brand
March 22, 2012 Company On-Site Survey Organization
Co., Ltd. construction, terminal
management in the past three
years. Provision of the
Companys public brochures in
2012.
Development trend of the
domestic luxury goods sector,
some measures concerning the
Shanghai Wisdom
Companys strategic
Investment
development, brand
April 18, 2012 Company On-Site Survey Organization Management Co.,
construction, terminal
Ltd. , Dongxing
management in the past three
Securities Co., Ltd.
years. Provision of the
Companys public brochures in
2012.
Development trend of the
E Fund Management domestic luxury goods sector,
June 20, 2012 Company On-Site Survey Organization Co., Ltd., Guosen some measures concerning the
Securities Co., Ltd. Companys strategic
development, brand
51
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
construction, terminal
management in the past three
years. Provision of the
Companys public brochures in
2012.
(XV) Engagement and Disengagement of CPAs
Has the semi-annual report been audited
No
Has the Accounting Firm been changed?
No
(XVI) Penalties and Rectification of the Company and its Directors, Supervisors,
Senior Executives, Shareholders and the Actual Controller and Acquisitor
Inapplicable
(XVII) Notes to Other Significant Events
Inapplicable
(XVIII) Description of the Earning Power of the Underwriter of The Company's
Convertible Bonds, Status of the Assets and Significant Change in the Status
of the Letter of Credit
(This form is only to be filled in by the listed company that has issued the Companys convertible bonds)
Inapplicable
(XIX) Information Disclosure Index
Names of the newspapers
Internet website where the
for publishing and the
Events Publishing date information is disclosed and
page where the
route for retrieving
information is disclosed
Announcement on Securities Times, Page D7
st
Resolutions of 2011 1 and Hong Kong
January 4, 2012 http://www.cninfo.com.cn
Extraordinary Commercial Daily, Page A
Shareholders Meeting 6
the Suggestive Securities Times, Page
Announcement on Listing D29 and
January 5, 2012 http://www.cninfo.com.cn
of the Non-Publically Hong Kong Commercial
Issued Resitrcted Shares Daily, Page A 21
52
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Announcement on the Securities Times, Page D4
Predicted Growth of the and Hong Kong
January 10, 2012 http://www.cninfo.com.cn
Operating Results of the Commercial Daily, Page A
Year 2011 20
Securities Times, Page
2011 Annual Report D68 and Hong Kong
February 28, 2012 http://www.cninfo.com.cn
Summary Commercial Daily, Page A
21
Announcement on Securities Times, Page
st
Resolutions of the 31 D68 and Hong Kong
February 28, 2012 http://www.cninfo.com.cn
Meeting of the Sixth Board Commercial Daily, Page A
of Directors 21
Announcement on Securities Times, Page
th
Resolutions of the 15 D68 and Hong Kong
February 28, 2012 http://www.cninfo.com.cn
Meeting of the Sixth Commercial Daily, Page A
Supervisory Committee 21
Announcement on
Implementation of Regular Securities Times, Page
Related Transactions in D68 and Hong Kong
February 28, 2012 http://www.cninfo.com.cn
2011 and Prediction of Commercial Daily, Page A
Regular Related 21
Transactions in 2012
Securities Times, Page
Notice on holding 2011
D17 and Hong Kong
Shareholders General April 6, 2012 http://www.cninfo.com.cn
Commercial Daily, Page A
Meeting
11
Securities Times, Page
Announcement on
D36 and Hong Kong
Resolutions of 2011 April 12, 2012 http://www.cninfo.com.cn
Commercial Daily, Page A
Annual General Meeting
24
Securities Times, Page
st
2012 1 Quarterly Report, D36 and Hong Kong
April 17, 2012 http://www.cninfo.com.cn
the Text Commercial Daily, Page A
6
Announcement on Securities Times, Page
nd
Resolutions of the 32 D36 and Hong Kong
April 17, 2012 http://www.cninfo.com.cn
Meeting of the Sixth Board Commercial Daily, Page A
of Directors 6
Announcement on Securities Times, Page
th
Resolutions of the 16 D36 and Hong Kong
April 17, 2012 http://www.cninfo.com.cn
Meeting of the Sixth Commercial Daily, Page A
Supervisory Committee 6
53
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
Securities Times, Page
Announcement on
D24 and Hong Kong
Implementation of 2011 May 25, 2012 http://www.cninfo.com.cn
Commercial Daily, Page A
Equity Distribution
15
Announcement on Securities Times, Page
rd
Resolutions of the 33 D20 and Hong Kong
June 20, 2012 http://www.cninfo.com.cn
Meeting of the Sixth Board Commercial Daily, Page
of Directors B11
Announcement on Securities Times, Page
th
Resolutions of the 17 D20 and Hong Kong
June 20, 2012 http://www.cninfo.com.cn
Meeting of the Sixth Commercial Daily, Page
Supervisory Committee B11
st
Securities Times, Page
Notice on Holding 2012 1
D20 and Hong Kong
Extraordinary June 20, 2012 http://www.cninfo.com.cn
Commercial Daily, Page
Shareholders Meeting
B11
54
FIYTA Holdings Ltd.
2012 Semi-Annual Report, Full Text
VIII. Financial Report
(I) Auditors’ Report
Has the semi-annual report been audited
No
(II) Financial Report
Are consolidated statements necessary?
Yes
Unless otherwise specified, the unit used for all the financial statements of this financial report is
Chinese yuan.
The unit used for the statements in the financial notes is Chinese yuan.
1. Consolidated Balance Sheet
Prepared by: FIYTA Holdings Ltd.
In CNY
Items Notes Ending balance Opening balance
Current assets:
Monetary fund 210,307,884.08 179,972,430.02
Settlement Reserve
Inter-bank lending
Trading financial assets 0.00 0.00
Notes receivable 0.00 0.00
Accounts receivable 358,231,728.75 268,900,768.37
Prepayments 42,160,697.24 77,139,710.01
Insurance premium
receivable
Reinsurance accounts
receivable
Accounts receivable
reinsurance reserve
Interest receivable 0.00 0.00
Dividends receivable 0.00 0.00
Other receivables 36,657,982.84 34,058,993.74
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Buying and selling back
financial assets
Inventories 1,798,863,541.95 1,640,904,483.64
Non-current assets due
within a year
Other current assets 39,125,068.40 44,245,896.17
Total current assets 2,485,346,903.26 2,245,222,281.95
Non-Current Assets:
Disbursement of
entrusted loans and advances
Available-for-sale
0.00 0.00
financial assets
Held –to-due investment 0.00 0.00
Long-term accounts
0.00 0.00
receivable
Long-term equity
42,140,196.62 1,948,572.76
investment
Investment based real
267,663,668.77 272,490,648.63
estate
Fixed assets 288,962,008.25 295,407,284.31
Construction-in-process 2,583,805.57 249,000.00
Engineering supplies 0.00 0.00
Disposal of fixed assets 0.00 0.00
Productive biological
assets
Oil and gas asset 0.00 0.00
Intangible assets 36,750,350.05 37,065,827.49
Development expenses
Goodwill
Long-term expenses to
131,450,066.50 122,665,313.17
be apportioned
Deferred income tax
51,515,694.17 46,250,916.43
asset
Other non-current assets 0.00 40,300,250.00
Total non-current assets 821,065,789.93 816,377,812.79
Total assets 3,306,412,693.19 3,061,600,094.74
Current liabilities:
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Short-term Loan 1,375,000,000.00 1,099,107,000.00
Borrowings from central
bank
Receipt of deposits and
deposits from other banks
Loans from other banks
Trading financial liabilities 0.00 0.00
Notes payable 125,000,000.00 0.00
Accounts payable 185,929,348.00 191,460,941.62
Advance receipts 9,999,570.06 3,740,327.89
Funds from selling out
and repurchasing financial
assets
Service charge and
commission payable
Salaries payable to the
14,301,994.29 27,414,469.57
employees
Taxes payable 46,901,706.74 50,298,472.82
Interest payable 2,712,814.61 14,038,573.07
Dividends payable 0.00 0.00
Other payables 33,222,161.59 33,000,834.53
Reinsurance payable
Insurance contract
reserve
Funds from securities
trading agency
Funds from underwriting
securities agency
Non-current liabilities due
49,900,000.00 149,600,000.00
within a year
Other current liabilities 5,881,030.87 4,814,572.85
Total current liabilities 1,848,848,626.16 1,573,475,192.35
Non-Current Liabilities:
Long-term loan 57,236,712.79 57,030,567.09
Bonds payable
Long term accounts
payable
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Special accounts payable 0.00 0.00
Predicted liabilities 0.00 0.00
Deferred income tax
128,393.19 128,393.19
liability
Other non-current
3,286,000.00 2,350,000.00
liabilities
Total non-current liabilities 60,651,105.98 59,508,960.28
Total liabilities 1,909,499,732.14 1,632,984,152.63
Owners equity (or
shareholders equity):
Paid up capital (or capital
392,767,870.00 392,767,870.00
stock)
Capital reserve 525,506,952.78 581,606,952.78
Less: shares in stock
Special reserve
Surplus reserve 131,323,437.78 131,323,437.78
Generic risk reserve
Retained earnings 353,534,591.20 327,521,960.58
Foreign Currency Capital -8,846,130.40 -7,355,528.69
Total owners equity
attributable to the parent 1,394,286,721.36 1,425,864,692.45
company
Minority equity 2,626,239.69 2,751,249.66
Owners equity (or
1,396,912,961.05 1,428,615,942.11
shareholders equity)
Total liabilities and owners
3,306,412,693.19 3,061,600,094.74
equity (or shareholders equity)
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
2. Balance Sheet, Parent Company
In CNY
Items Notes Ending balance Opening balance
Current assets:
Monetary fund 71,657,500.90 49,327,161.12
Trading financial assets
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Notes receivable
Accounts receivable 190,777,030.60 157,324,732.29
Prepayments
Interest receivable
Dividends receivable 75,960,140.05 34,607,884.20
Other receivables 1,216,681,934.78 879,552,488.89
Inventories 27,970,155.67 60,263,407.14
Non-current assets due
within a year
Other current assets
Total current assets 1,583,046,762.00 1,181,075,673.64
Non-Current Assets:
Available-for-sale
financial assets
Held –to-due investment
Long-term accounts
receivable
Long-term equity
774,339,916.62 734,148,292.76
investment
Investment based real
267,663,668.77 272,490,648.63
estate
Fixed assets 99,571,742.32 103,792,286.84
Construction-in-process 2,583,805.57 249,000.00
Engineering supplies
Disposal of fixed assets
Productive biological
assets
Oil and gas asset
Intangible assets 30,385,508.51 30,695,325.97
Development expenses
Goodwill
Long-term expenses to
14,792,833.28 22,046,301.93
be apportioned
Deferred income tax
3,642,026.85 3,642,026.85
asset
Other non-current assets 0.00 40,300,250.00
Total non-current assets 1,192,979,501.92 1,207,364,132.98
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Total assets 2,776,026,263.92 2,388,439,806.62
Current liabilities:
Short-term Loan 1,310,000,000.00 912,000,000.00
Trading financial liabilities
Notes payable 62,500,000.00 0.00
Accounts payable 4,143,231.42 9,109,177.41
Advance receipts 1,684,798.45 1,466,500.43
Salaries payable to the
0.00 4,839,475.00
employees
Taxes payable 10,750,345.10 17,593,036.57
Interest payable 1,907,509.99 1,907,509.99
Dividends payable 0.00 0.00
Other payables 54,848,855.73 43,019,929.22
Non-current liabilities due
49,900,000.00 149,600,000.00
within a year
Other current liabilities 0.00 0.00
Total current liabilities 1,495,734,740.69 1,139,535,628.62
Non-Current Liabilities:
Long-term loan
Bonds payable
Long term accounts
payable
Special accounts payable
Predicted liabilities
Deferred income tax
128,393.19 128,393.19
liability
Other non-current
3,286,000.00 2,350,000.00
liabilities
Total non-current liabilities 3,414,393.19 2,478,393.19
Total liabilities 1,499,149,133.88 1,142,014,021.81
Owners equity (or
shareholders equity):
Paid up capital (or capital
392,767,870.00 392,767,870.00
stock)
Capital reserve 531,162,493.88 531,162,493.88
Less: shares in stock
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Special reserve
Surplus reserve 131,323,437.78 131,323,437.78
Generic risk reserve
Retained earnings 221,623,328.38 191,171,983.15
Foreign Currency Capital
Owners equity (or
1,276,877,130.04 1,246,425,784.81
shareholders equity)
Total liabilities and owners
2,776,026,263.92 2,388,439,806.62
equity (or shareholders equity)
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
3. Consolidated Profit Statement
In CNY
Items Notes Amount in the reporting period Amount in the previous period
I. Gross Revenue 1,483,755,811.36 1,232,010,736.41
Including: revenue 1,483,755,811.36 1,232,010,736.41
Interest income
Earned premium
Service charge
and commission income
II. Total operating cost 1,403,350,279.05 1,136,177,291.76
Including: operating costs 987,034,886.89 820,486,746.77
Interest payment
Service charge
and commission payment
Refunded
premiums
Compensation
pay-out, net
Net amount of
reserves for reinsurance
contract
Policy dividend
payment
Reinsurance
expenses
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Business taxes
8,333,683.51 5,684,565.06
and surcharge
Sales costs 260,546,992.95 186,543,960.33
Administrative
87,835,143.36 86,969,634.99
expenses
Financial
59,603,871.04 34,235,933.76
expenses
Loss from
-4,298.70 2,256,450.85
impairment of assets
Plus: Income from
change of fair value (loss is 0.00 0.00
stated with “-“)
Investment
191,373.86 -48,985.48
income (loss is stated with “-“)
Including: income
from investment in associates 191,373.86 -48,985.48
and joint ventures
Exchange income
(loss is stated with “-“)
III. Operating Profit (loss is
80,596,906.17 95,784,459.17
stated with “-“)
Plus: Non-operating
1,841,642.65 1,374,365.97
income
Less: Non-operating
105,428.22 6,353.38
expenses
Including: Loss
from disposal of non-current 11,895.85 487.00
assets
IV. Total profit (total loss is
82,333,120.60 97,152,471.76
stated with “-“)
Less: Income tax
17,173,824.32 17,802,177.43
expense
V. Net Profit (net loss is stated
65,159,296.28 79,350,294.33
with “-“)
Including: Net profit
realized by the consolidatee
-2,130,265.54 -6,816,548.19
realized before the
consolidation
Net profit attributable to
65,289,417.62 79,173,594.56
the parent companys owner
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Minority shareholders
-130,121.34 176,699.77
gain/loss
VI. Earnings per share: -- --
(I) Basic earnings per
0.166 0.202
share
(II) Diluted earnings per
0.166 0.202
share
VII. Other comprehensive
-1,485,490.34 2,071,076.23
income
VIII. Total comprehensive
63,673,805.94 81,421,370.56
income
Total comprehensive
income attributable to the 63,798,815.91 81,283,624.43
owner of the parent company
Total comprehensive
income attributable to minority -125,009.97 137,746.13
shareholders
In case consolidation of the enterprises under the common control took place in the reporting period, the net profit
realized by the enterprises to be consolidated before the consolidation was CNY -2,130,265.54.
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
4. Profit Statement, Parent Company
In CNY
Items Notes Amount in the reporting period Amount in the previous period
I. Revenue 82,860,262.56 229,421,696.61
Less: Business costs 46,268,068.51 108,169,866.25
Business taxes and
4,005,146.32 2,491,222.67
surcharge
Sales costs 7,329,606.71 75,701,460.95
Administrative
20,299,535.62 32,034,218.96
expenses
Financial expenses 12,666,803.25 9,193,668.62
Loss from
-4,298.70 0.00
impairment of assets
Plus: Income from
change of fair value (loss is 0.00 0.00
stated with “-“)
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Investment income
76,151,513.91 34,138,145.45
(loss is stated with “-“)
Including: income
from investment in associates 191,373.86 -48,985.48
and joint ventures
II. Operating Profit (loss is
68,446,914.76 35,969,404.61
stated with “-“)
Plus: Non-operating
1,373,691.87 350,853.72
income
Less: Non-operating
92,474.40 487.00
expenses
Including: Loss from
872.93 487.00
disposal of non-current assets
III. Total profit (total loss is
69,728,132.23 36,319,771.33
stated with “-“)
Less: Income tax
0.00 516,812.76
expense
IV. Net Profit (net loss is stated
69,728,132.23 35,802,958.57
with “-“)
V. Earnings per share -- --
(I) Basic earnings per
share
(II) Diluted earnings per
share
VI. Other comprehensive
0.00 0.00
income
VII. Total comprehensive
69,728,132.23 35,802,958.57
income
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
5. Consolidated Cash Flow Statement
In CNY
Items Amount in the reporting period Amount in the previous period
I. Net cash flows arising from
operating activities:
Cash received from sales of
1,568,077,993.80 1,359,710,881.45
goods and supply of labor
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Net increase of customers
deposit and due from banks
Net increase of borrowings
from the central bank
Net increase of borrowings
from other financial institutions
Cash received from former
insurance contract premium
Net cash received from
reinsurance business
Net increase of insurance
reserve and investment
Net increase from disposal
of transactional financial asset
Cash received from interest,
service charge and commission
Net increase of borrowings
Net increase of fund from
repurchases
Rebated taxes received 0.00 217,481.16
Other operation activity
12,564,978.28 4,608,116.36
related cash receipts
Subtotal of cash flow in from
1,580,642,972.08 1,364,536,478.97
operating activity
Cash paid for purchase of
goods and reception of labor 1,262,119,139.90 1,147,963,105.94
services
Net increase of loans and
advances to customers
Net increase of due from
central bank and due from banks
Cash paid for indemnity of
original insurance contract
Cash paid for interest,
service charge and commission
Cash paid for insurance
policy dividend
Cash paid to and for staff 180,306,617.10 127,842,281.46
Taxes paid 87,831,415.58 75,325,571.35
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Other business related cash
143,733,003.12 120,054,090.19
payments
Subtotal of cash flow out from
1,673,990,175.70 1,471,185,048.94
operating activity
Net cash flow arising from
-93,347,203.62 -106,648,569.97
operating activities
II. Cash flows arising from
investment activities:
Cash received from recovery
of investment
Cash received from
investment income
Net amount of cash received
from disposal of fixed assets,
53,358.08 86,686.60
intangible assets and other long
term assets
Net cash received from
disposal of subsidiaries and other 0.00 0.00
operating units
Other investment related
0.00 0.00
cash receipts
Subtotal of cash flow in from
53,358.08 86,686.60
investment activity
Cash paid for
construction/purchase of fixed
47,475,391.95 192,928,519.40
assets, intangible assets and other
long term assets
Cash paid for investment 28,050,000.00 19,107,200.00
Net increase of
hypothecated loans
Net cash received from
payment by subsidiaries and other 0.00 0.00
operating units
Other investment related
0.00 0.00
cash payments
Subtotal of cash flow out from
75,525,391.95 212,035,719.40
investment activity
Net cash flow arising from
-75,472,033.87 -211,949,032.80
investment activities
III. Cash flows arising from fund
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raising activities:
Cash received from
absorption of investment
Incl.: Cash received from
subsidiaries absorption of minority
shareholders investment
Cash received from
917,000,000.00 629,311,000.00
borrowings
Cash received from bond
issuing
Other fund-raising related
125,000,000.00 0.00
cash receipts
Subtotal of cash flow in from fund
1,042,000,000.00 629,311,000.00
raising activity
Cash paid for liabilities
740,902,058.84 616,135,405.74
repayment
Cash paid for dividend/profit
distribution or repayment of 100,936,223.78 51,452,122.18
interest
Including: Dividend and
profit paid by subsidiaries to
minority shareholders
Other fund-raising related
1,031,250.90 231,600.00
cash payments
Subtotal of cash flow out from fund
842,869,533.52 667,819,127.92
raising activity
Net cash flow arising from
199,130,466.48 -38,508,127.92
fund-raising activities
IV. Influence from change of
exchange rate upon cash and 24,225.07 -50,095.91
cash equivalents
V. Net increase of cash and cash
30,335,454.06 -357,155,826.60
equivalents
Plus: Opening balance of
179,972,430.02 664,455,817.52
cash and cash equivalents
VI. Ending balance of cash and
210,307,884.08 307,299,990.92
cash equivalents
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
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6. Cash Flow Statement, Parent Company
In CNY
Items Amount in the reporting period Amount in the previous period
I. Net cash flows arising from
operating activities:
Cash received from sales of
53,110,671.45 232,850,800.27
goods and supply of labor
Rebated taxes received
Other operation activity
70,163,474.04 86,972,592.72
related cash receipts
Subtotal of cash flow in from
123,274,145.49 319,823,392.99
operating activity
Cash paid for purchase of
goods and reception of labor 9,645,155.22 118,780,238.76
services
Cash paid to and for staff 21,344,665.48 48,764,907.85
Taxes paid 22,736,599.85 9,941,251.63
Other business related cash
290,935,269.71 55,029,872.30
payments
Subtotal of cash flow out from
344,661,690.26 232,516,270.54
operating activity
Net cash flow arising from
-221,387,544.77 87,307,122.45
operating activities
II. Cash flows arising from
investment activities:
Cash received from recovery
of investment
Cash received from
34,907,884.20
investment income
Net amount of cash received
from disposal of fixed assets,
33,000.00 86,686.60
intangible assets and other long
term assets
Net cash received from
disposal of subsidiaries and other
operating units
Other investment related
cash receipts
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Subtotal of cash flow in from
34,940,884.20 86,686.60
investment activity
Cash paid for
construction/purchase of fixed
7,408,400.71 11,525,931.38
assets, intangible assets and other
long term assets
Cash paid for investment 352,807,200.00
Net cash received from
payment by subsidiaries and other
operating units
Other investment related
cash payments
Subtotal of cash flow out from
7,408,400.71 364,333,131.38
investment activity
Net cash flow arising from
27,532,483.49 -364,246,444.78
investment activities
III. Cash flows arising from fund
raising activities:
Cash received from
absorption of investment
Cash received from
882,000,000.00 392,000,000.00
borrowings
Cash received from bond
issuing
Other fund-raising related
cash receipts
Subtotal of cash flow in from fund
882,000,000.00 392,000,000.00
raising activity
Cash paid for liabilities
583,700,000.00 448,000,000.00
repayment
Cash paid for dividend/profit
distribution or repayment of 81,083,348.04 47,490,785.45
interest
Other fund-raising related
1,031,250.90 231,600.00
cash payments
Subtotal of cash flow out from fund
665,814,598.94 495,722,385.45
raising activity
Net cash flow arising from
216,185,401.06 -103,722,385.45
fund-raising activities
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IV. Influence from change of
exchange rate upon cash and
cash equivalents
V. Net increase of cash and cash
22,330,339.78 -380,661,707.78
equivalents
Plus: Opening balance of
49,327,161.12 529,568,738.47
cash and cash equivalents
VI. Ending balance of cash and
71,657,500.90 148,907,030.69
cash equivalents
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
7. Consolidated Statement of Changes in Owner’s Equity
Amount in the reporting period
In CNY
Amount in the reporting period
Owners equity attributable to the parent company
Paid
up
Gene
capit Capit Less: Speci Surpl Retai Minorit Total
Items ric
al (or al share al us ned Other y owners
risk
capit reser s in reser reser earni s equity equity
reser
al ve stock ve ve ngs
ve
stock
)
I. Ending balance of the
previous year
Plus: Change in
accounting policy
Correction of
previous errors
Others
392,7 581,6 131,3 327,5 -7,35 1,428,6
II. Opening balance of the 2,751,2
67,87 06,95 23,43 21,96 5,528 15,942.
report year 49.66
0.00 2.78 7.78 0.58 .69 11
III. Decrease/increase of -56,1 26,01 -1,49
-125,0 -31,702,
the report year (decrease 00,00 2,630 0,601
09.97 981.06
is stated with “-“) 0.00 .62 .71
(I) Net profit 65,28 -130,1 65,159,
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9,417 21.34 296.28
.62
-1,49
(II) Other comprehensive 5,111.3 -1,485,4
0,601
income 7 90.34
.71
65,28 -1,49
Subtotal of the above (I) -125,0 63,673,
9,417 0,601
and (II) 09.97 805.94
.62 .71
-56,1
(III) Owners input and -56,100,
0.00 00,00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
decrease of capital 000.00
0.00
1. Capital invested by the
owners
2. Amount of payment for
shares credited to owners
equity
-56,1
-56,100,
3. Others 00,00
000.00
0.00
-39,2
-39,276,
(IV) Profit distribution 0.00 0.00 0.00 0.00 0.00 0.00 76,78 0.00 0.00
787.00
7.00
1. Provision of surplus
reserve
2. Provision of generic risk
reserve
-39,2
3. Distribution to the -39,276,
76,78
owners (or shareholders) 787.00
7.00
4. Others
(V) Internal carry-forward
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
of owners equity
1. Conversion of capital
reserve into capital (or
capital stock)
2. Conversion of surplus
reserve into capital (or
capital stock)
3. Loss made up with
surplus reserve
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4. Others
(VI) Special reserve
1. Provision in the
reporting period
2. Applied in the reporting
period
(VII) Others
392,7 525,5 131,3 353,5 -8,84 1,396,9
IV. Ending balance of the 2,626,2
67,87 06,95 23,43 34,59 6,130 12,961.
reporting period 39.69
0.00 2.78 7.78 1.20 .40 05
Amount of Previous Year
In CNY
Amount of Previous Year
Owners equity attributable to the parent company
Paid
up
Gene
capit Capit Less: Speci Surpl Retai Minorit Total
Items ric
al (or al share al us ned Other y owners
risk
capit reser s in reser reser earni s equity equity
reser
al ve stock ve ve ngs
ve
stock
)
I. Ending balance of the
previous year
Plus: Retroactive
adjustment arising from
consolidation of the
enterprises under common
control
Plus: Change in
accounting policy
Correction of
previous errors
Others
280,5 643,3 121,0 222,5 -1,51 1,287,5
II. Opening balance of the 21,569,
48,47 81,88 66,99 14,56 5,341 65,949.
report year 365.56
9.00 4.88 2.16 9.59 .96 23
III. Decrease/increase of 112,2 -61,7 10,25 105,0 -5,84 -18,81
141,049
the report year (decrease 19,39 74,93 6,445 07,39 0,186 8,115.9
,992.88
is stated with “-“) 1.00 2.10 .62 0.99 .73 0
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143,3
-198,5 143,120
(I) Net profit 18,68
00.02 ,184.49
4.51
-5,84
(II) Other comprehensive -67,95 -5,908,1
0,186
income 6.98 43.71
.73
143,3 -5,84
Subtotal of the above (I) -266,4 137,212
18,68 0,186
and (II) 57.00 ,040.78
4.51 .73
50,44 -18,55
(III) Owners input and 31,892,
0.00 4,458 0.00 0.00 0.00 0.00 0.00 0.00 1,658.9
decrease of capital 800.00
.90 0
1. Capital invested by the
owners
2. Amount of payment for
shares credited to owners
equity
50,44 -18,55
31,892,
3. Others 4,458 1,658.9
800.00
.90 0
10,25 -38,3
-28,054,
(IV) Profit distribution 0.00 0.00 0.00 0.00 6,445 0.00 11,29 0.00 0.00
847.90
.62 3.52
10,25 -10,2
1. Provision of surplus
6,445 56,44
reserve
.62 5.62
2. Provision of generic risk
reserve
-28,0
3. Distribution to the -28,054,
54,84
owners (or shareholders) 847.90
7.90
4. Others
112,2 -112,
(V) Internal carry-forward
19,39 219,3 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
of owners equity
1.00 91.00
1. Conversion of capital 112,2 -112,
reserve into capital (or 19,39 219,3
capital stock) 1.00 91.00
2. Conversion of surplus
reserve into capital (or
capital stock)
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3. Loss made up with
surplus reserve
4. Others
(VI) Special reserve
1. Provision in the
reporting period
2. Applied in the reporting
period
(VII) Others
392,7 581,6 131,3 327,5 -7,35 1,428,6
IV. Ending balance of the 2,751,2
67,87 06,95 23,43 21,96 5,528 15,942.
reporting period 49.66
0.00 2.78 7.78 0.58 .69 11
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
3. Statement of Change in Owner’s Equity of the Parent Company
Amount in the reporting period
In CNY
Amount in the reporting period
Paid up
Retaine
capital Less: Generic Total
Items Capital Special Surplus d
(or shares risk owners
reserve reserve reserve earning
capital in stock reserve equity
s
stock)
I. Ending balance of the
previous year
Plus: Change in
accounting policy
Correction of
previous errors
Others
1,246,4
II. Opening balance of the 280,548 643,381 131,323 191,171
25,784.
report year ,479.00 ,884.88 ,437.78 ,983.15
81
III. Decrease/increase of the -112,21
112,219 30,451, 30,451,
report year (decrease is 9,391.0
,391.00 345.23 345.23
stated with “-“) 0
(I) Net profit 69,728, 69,728,
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132.23 132.23
(II) Other comprehensive
income
Subtotal of the above (I) and 69,728, 69,728,
(II) 132.23 132.23
(III) Owners input and
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
decrease of capital
1. Capital invested by the
owners
2. Amount of payment for
shares credited to owners
equity
3. Others
-39,276, -39,276,
(IV) Profit distribution 0.00 0.00 0.00 0.00 0.00 0.00
787.00 787.00
1. Provision of surplus
reserve
2. Provision of generic risk
reserve
3. Distribution to the owners -39,276, -39,276,
(or shareholders) 787.00 787.00
4. Others
-112,21
(V) Internal carry-forward of 112,219
9,391.0 0.00 0.00 0.00 0.00 0.00 0.00
owners equity ,391.00
0
1. Conversion of capital -112,21
112,219
reserve into capital (or 9,391.0
,391.00
capital stock) 0
2. Conversion of surplus
reserve into capital (or
capital stock)
3. Loss made up with
surplus reserve
4. Others
(VI) Special reserve
1. Provision in the reporting
period
2. Applied in the reporting
period
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(VII) Others
1,276,8
IV. Ending balance of the 392,767 531,162 131,323 221,623
77,130.
reporting period ,870.00 ,493.88 ,437.78 ,328.38
04
Amount of Previous Year
In CNY
Amount of Previous Year
Paid up
Retaine
capital Less: Generic Total
Items Capital Special Surplus d
(or shares risk owners
reserve reserve reserve earning
capital in stock reserve equity
s
stock)
I. Ending balance of the
previous year
Plus: Change in
accounting policy
Correction of
previous errors
Others
1,171,9
II. Opening balance of the 280,548 643,381 121,066 126,918
16,176.
report year ,479.00 ,884.88 ,992.16 ,820.47
51
III. Decrease/increase of the -112,21
112,219 7,748,1 7,748,1
report year (decrease is 9,391.0
,391.00 10.67 10.67
stated with “-“) 0
35,802, 35,802,
(I) Net profit
958.57 958.57
(II) Other comprehensive
income
Subtotal of the above (I) and 35,802, 35,802,
(II) 958.57 958.57
(III) Owners input and
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
decrease of capital
1. Capital invested by the
owners
2. Amount of payment for
shares credited to owners
equity
3. Others
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-28,054, -28,054,
(IV) Profit distribution 0.00 0.00 0.00 0.00 0.00 0.00
847.90 847.90
1. Provision of surplus
reserve
2. Provision of generic risk
reserve
3. Distribution to the owners -28,054, -28,054,
(or shareholders) 847.90 847.90
4. Others
-112,21
(V) Internal carry-forward of 112,219
9,391.0 0.00 0.00 0.00 0.00 0.00 0.00
owners equity ,391.00
0
1. Conversion of capital -112,21
112,219
reserve into capital (or 9,391.0
,391.00
capital stock) 0
2. Conversion of surplus
reserve into capital (or
capital stock)
3. Loss made up with
surplus reserve
4. Others
(VI) Special reserve
1. Provision in the reporting
period
2. Applied in the reporting
period
(VII) Others
1,179,6
IV. Ending balance of the 392,767 531,162 121,066 134,666
64,287.
reporting period ,870.00 ,493.88 ,992.16 ,931.14
18
Legal Representative: Wu Guangquan Chief Financial Officer: Li Dehua Manager of the Accounting Dept:
Hu Xinglong
(III) General Information
Fiyta Holdings Ltd. (hereinafter referred to as the Company) was reorganized, incorporated and renamed from
Shenzhen Fiyta Timer Industry Company on December 25 1992 with approval by the General Office of Shenzhen
Municipal Peoples Government with Document SHEN FU BAN FU [1992] No. 1259 and with China National
Aero-Technology Import & Export Corporation Shenzhen Industry & Trade Center (which was renamed as China
National Aero-Technology Corporation Shenzhen) as the sponsor.
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On March 10, 1993, the Company, with approval by the Peoples Bank of China Shenzhen Special Economic Zone
Branch [SHEN REN YIN FU ZI (1993) No. 070], issued publically domestic CNY based common shares (A-shares)
and CNY based special shares (B-shares). In accordance with the Approval Document of Shenzhen Municipal
Securities Regulatory Office SHEN ZHENG BAN FU [1993] No. 20 and the Approval Document of Shenzhen
Stock Exchange SHEN ZHENG SHI ZI (1993) No. 16, the Companys A-shares and B-shares were all listed with
Shenzhen Stock Exchange for trading commencing from June 3, 1993.
On January 30, 1997, with approval by Shenzhen Municipal Administration for Industry and Commerce, the
Company was renamed as Shenzhen Fiyta Holdings Ltd.
On July 4, 1997, according to the equity assignment agreement between China National Aero-Technology
Corporation Shenzhen (CATIC Shenzhen Corporation) and CATIC Shenzhen Holdings Limited ( with original
name of Shenzhen CATIC Group Co., Ltd. (hereinafter referred to as CATIC Shenzhen), CATIC Shenzhen
Corporation assigned assigned 72.36 million corporate shares (taking 52.24% of the Companys total shares) to
CATIC Shenzhen. From then on, the Companys controlling shareholder turned to be CATIC Shenzhen from
CATIC Shenzhen Corporation.
On October 26, 2007, the Company implemented the equity separation reform, according to which the
shareholder of the Companys non-negotiable shares would pay shares to the whole shareholders of negotiable
shares registered on the equity record day as designated in the equity separation reform plan at the rate of 3.1
shares for every 10 shares held by them while the Companys total 249,317,999 shares remained unchanged.
So far, after the equity separation reform, the proportion of the Companys shares held by CATIC Shenzhen
reduced from 52.24% to 44.69%.
On February 29, 2008, due to expansion of the Companys business scope and with approval by Shenzhen
Municipal Administration for Industry and Commerce, the Companys enterprise corporate business licence
number was changed from 4403011001583 into 440301103196089
Approved by China Securities Regulatory Commission (CSRC) with the Official Reply on Approval of Non-public
Issuing of Shenzhen Fiyta Holdings Ltd., ZHENG JIAN XU KE [2010] No. 1703 and the Official Reply on the Issue
of Non-Public Issuing of Shenzhen Fiyta Holdings Ltd. by State-owned Assets Supervision and Administration
Commission of the State Council [2010] No. 430, the Company was approved to non-publically issue no more than
50 million common shares (A-shares). After completion of non-public issuing on December 9, 2010, the
Companys registered capital increased to CNY 280,548,479.00 and CATIC Shenzhen holds 41.49% of the
Companys equity based capital.
On March 3, 2011, with approval by Shenzhen Municipal Administration for Industry and Commerce, the Company
was renamed as Fiyta Holdings Ltd. from Shenzhen Fiyta Holdings Ltd.
On April 8, 2011, the Company took the total share capital of 280,548,479 shares as at December 31, 2010 as the
base, converted its capital reserve into share capital at the rate of 4 shares for every 10 shares. After the
conversion, the Companys total share capital became 392,767,870 shares.
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Ended June 30, 2012, the total volume of share capital accumulatively issued by the Company was 392,767,870
shares.
The principal business activities of the Company and its subsidiaries are: production and sales of various pointer
type quartz watches and units, spares and parts, various timing apparatus, processing and wholesale of K gold
watches and ornament watches (for production site, separate application should be submitted); domestic trade,
materials supply and sales (excluding the commodities for exclusive operation, exclusive control and monopoly);
property management and lease; import and export, design and construction; import and export business
(implemented according to Document SHEN MAO GUAN DENG ZHENG ZI NO. 2007-072). Legal Representative:
Wu Guangquan; The Companys registered office address: FIYTA Technology Building, Gaoxin S. Road One,
Nanshan District, Shenzhen.
The Companys parent is CATIC Shenzhen and the eventual controller is Aviation Industry Corporation of China
(hereinafter referred to as AVIC).
The Company has established the Shareholders General Meeting, the Board of Directors, the Supervisory
Committee, the Audit Committee, the Strategy Committee and the Nomination, Remuneration and Assessment
Committee as the governance organs, etc. The Company has also established such function departments as the
Comprehensive Administration Department, Human Resource Department, Finance Department, Audit
Department, General Office of the Board of Directors, Property Department, Research & Development
Department, Innovation and Design Department.
The financial statements were approved by the Board of Directors of the Company for issuing on August 24, 2012.
(IV) Principal Accounting Policies, Accounting Estimate and Correction of
Previous Errors
1. Base for Preparation of the Financial Statements
The Groups financial statements are prepared with the assumption of continuous operation and according to the
actually incurred transactions and matters. According to the Enterprise Accounting Standards – Basic Standards
and 38 Specific Accounting Standards promulgated by the Ministry of Finance in February 2006 as well as the
successively published application guides, interpretation and other relevant regulations of the enterprise
accounting standards (hereinafter all referred to as the Enterprise Accounting Standards) and the provisions on
information disclosure as specified in the Rules for the Compilation and Submission of Information Disclosure by
Companies That Offer Securities to the Public No.15 – General Provisions of Financial Report (Revision in 2010)
promulgated by China Securities Regulatory Commission.
According to the relevant provisions of the enterprise accounting standards, the Company takes the accrual basis
as the base of accounting. Except some financial instruments, these financial statements are all measured based
on historical cost. In case any asset experiences impairment, the impairment reserve is provided according to the
relevant provisions.
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2. Declaration on Adherence to the Accounting Standards for Enterprises
The financial statements prepared by the Group comply with the enterprise accounting standards, have truly and
fully reflected the financial position of the Company and the Group as at June 30, 20121 and such information as
its operation results and cash flow from January to June, 2012. In addition, the financial statements of Company
and the Group comply with the Rules for the Compilation and Submission of Information Disclosure by Companies
That Offer Securities to the Public No.15 – General Provisions of Financial Report (Revision in 2010) concerning
the requirement on disclosure of financial statements and the notes promulgated by China Securities Regulatory
Commission in all material aspects.
3. Fiscal Year
The Group classifies accounting period into annual and semi-annual periods. A mid-term accounting period refers
a reporting period shorter than an entire fiscal year. The Groups fiscal year adopts the Gregorian calendar year,
namely from January 1 to December 31 of a year.
4. Functional currency for bookkeeping
CNY is the currency in the major economic environment where the Companys and its domestic subsidiaries
premises are located. The Company and its domestic subsidiaries take CNY as the recording currency.
The currency used by the Group in preparation of the financial statements is Chinese yuan.
Recording currency for the oversea subsidiaries:
Except Switzerland based Montres Chouriet SA (hereinafter referred to as the Swiss Company), a subsidiary of
FIYTA (Hong Kong) Limited (hereinafter referred to as FIYTA Hong Kong) which takes Swiss Franc as the
recording currency according to the major economic environment of the place where its premises is located, the
other overseas subsidiaries, including Harmony World Watches International Limited (World Watch International),
one of the subsidiaries ofShenzhen Harmony World Watches Center Co., Ltd. (Harmony), FIYTA (Hong Kong)
Limited, 68-Station Limited (68-Station), one of FIYTA (Hong Kong) Limiteds subsidiaries, NATURE ART LTD., an
entity controlled by 68-Station for special purpose (Nature Art), PROTOP LTD (PROTOP) and HARMONY World
Watches International Limited, one of HARMONYs subsidiaries (World Watches International) take Hong Kong
Dollars as its recording currency according to the major economic environment of the place where their premises
are located. The currency adopted by the Group in preparation of the financial statements is Chinese yuan (CNY).
5. Accounting for consolidation of enterprises under the common control and not under
the common control
(1) Consolidation of enterprises under the common control
Consolidation of an enterprise under the common control refers to an enterprise involved in consolidation is under
the control by one party or more before and after consolidation while such control is not temporary. In
consolidation of the enterprises not under the common control, the party that has acquired the control power over
the other enterprises involved in the consolidation refers to the consolidator and the other enterprise(s) involved in
the consolidation is/are the consolidatee(s). Date of consolidation refers to the date when the consolidator actually
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acquires the control over the consolidatee.
The asset and liability acquired by the consolidator should be measured based on the book value of the
consolidatee on the date of consolidation.The difference between the book value of net assets acquired by the
consolidator, the book value of the consolidate valuable consideration paid or the total book value of the issued
shares was used to adjust the capital reserve (capital stock premium . In case the capital reserve (capital stock
premium) is not enough to be written-down, the retained earnings are adjusted.
The direct expenses incurred in enterprise consolidation to the consolidating party is charged to the current gain
and loss.
(2) Enterprise consolidation not under the common control
Consolidation of a party not under the same control refers to an enterprise involved in consolidation is not under
the same eventual control by one party or more before and after consolidation. In consolidation of the enterprises
not under the same control, the party that has acquired the control power over the other enterprises involved in the
consolidation refers to the purchaser and the other enterprise(s) involved in the consolidation is/are the purchasee.
Date of purchase refers to the date when the purchaser actually acquires the control over the purchasee.
For the consolidation of enterprices not under the same control, the consolidation costs consist of the fair value of
the assets paid, liabilities incurred or assumed and the issued equity based securities for the purpose of
acquisition of the control power over the purchasee and expenses incurred in connection with the consolidation,
including the charges for audit, law service, appraisal and consulting and other administrative costs are charged to
the current gains and losses. The transaction costs of the equity securities or debt securities issued by the
purchaser as the consolidation consideration are counted to the initially recognized amount of the equity securities
or debt securities. The contingent consideration involved is recorded in the consolidation costs based on the fair
value as at the purchase date; for the contingent consideration necessary to be adjusted against the conditions
which already exist as at the purchase date or further evidence within 12 months after the purchase date, the
consolidated goodwill should be adjusted correspondingly. In case of enterprise consolidation realized by steps
through several exchange transactions, in the Groups consolidated financial statements, the equity of the
purchasee held before the purchase date shall be re-measured based on the fair value of the equity as at the
purchase date; the difference between the fair value and its book value is recorded in the current return on
investment as at the purchase date; meanwhile, the other comprehensive income in connection with the equity of
the purchasee held before the purchase date shall be converted into the current return on investment; the
consolidation cost is the sum of the fair value of the purchasees equity as at the purchase date held before the
purchase date and the fair value of the purchasees equity as at the purchase date increased as at the purchase
date.
The consolidation cost incurred to the purchaser and the recognizable net asset acquired from consolidation are
measured based on the fair value of the purchase day. The difference of the consolidation cost greater than the
fair value share of the recognizable net asset on the date of purchase is recognized as goodwill. In case the
consolidation cost is less than the share of the faire value of the purchasees distinguishable net assets, the
Company first of all rechecks the fair value of the purchasees various distinguishable assets, liabilities or
contingent liabilities and measurement of the consolidation costs. In case the consolidation cost is still smaller
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than the share of the fair value of the purchasees distinguishable net assets acquired in the consolidation after the
recheck, its difference is recorded in the current gain and loss.
In case the purchasees offsetable provisional difference acquired by the purchaser is not recognized due to that it
does not comply with the conditions for recognition of the deferred income tax asset, within 12 months after the
purchase date, if the new or further information as obtained shows that the relevant conditions as at the purchase
date already exist, it is predicted that the economic benefit of the purchasees offsetable provisional difference as
at the purchase date can be realized, the relevant deferred income tax asset is recognized; meanwhile, the
goodwill is reduced. In case the goodwill is not enough to be written-down, the difference shall be recognized as
the current gain/loss. Except the aforesaid conditions, the deferred income tax asset recognized in connection
with the enterprise consolidation is recorded in the current gain/loss.
6. Preparation of Consolidated Financial Statements
(1) Method for Preparation of Consolidated Financial Statements
A. Determination of the Consolidation Range of Financial Statements
The consolidation range of consolidated financial statements is determined with control as the base. Control refers
to that the Company is able to decide the financial and operating policy of the investee, the power against which
the Company is able to obtain interest from the operation activities of the investee. Consolidation range includes
the Company and all the subsidiaries. A subsidiary refers to an enterprise or entity under the Companys control.
B. Method for Preparation of Consolidated Financial Statements
The Group consolidates the subsidiaries commencing from the date when the subsidiaries net assets and
production and operating decision making power are actually under the Companys control. The consolidation
shall stop commencing from the date when the actual control authority is lost. For a subsidiary to be disposed,
the operation result and cash flow prior to the day of disposal have been properly included in the consolidated
profit statement and consolidated cash flow statement; for a subsidiary to be disposed in the current period, the
consolidated balance sheet at the beginning of the period is not adjusted. For the subsidiaries increased through
consolidation of the enterprises not under the same control, the operating results and cash flow after the purchase
date have been properly included in the consolidated profit statement and consolidated statement of cash flow
while the amount at the beginning of the period and comparative amount in the consolidated financial statements
shall not be adjusted. For the subsidiaries increased through consolidation of the enterprises under the same
control, the operating results and cash flow from the very period of consolidation to the consolidation date have
been properly included in the consolidated profit statement and consolidated statement of cash flow; moreover,
comparative amount in the consolidated financial statements shall be adjusted at the same time.
In process of preparation of consolidated statements, in case the accounting policy or fiscal term adopted by the
subsidiaries and the Company are not identical, in preparation of the consolidated financial statements,
consolidation is made after necessary adjustment of the subsidiaries financial statements in terms of the
Companys accounting policy or fiscal term. For the subsidiaries acquired through consolidation of enterprises
not under the same control, the financial statements are adjusted with the fair value of recognizable net assets on
the date of purchase as the base.
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All the material current account balance, transactions and unrealized profit within the Group are offset at the time
of preparation of the consolidated financial statements.
The part in the subsidiaries shareholders equity and the net current gain and loss which do not belong to the part
held by the Company are taken as minority equity and minority gain and loss and are respectively listed under the
shareholders equity and net profit separately in the consolidated financial statement. The part of the current net
gain and loss of a subsidiary belonging to minority shareholders equity is presented as “minority shareholders
gain and loss” under the item of net profit in the consolidated profit statement. In case the loss of a subsidiary
shared by the minority shareholders has exceeded the share of the owners equity of the subsidiary enjoyable by
the minority shareholders at the beginning of the period, the minority shareholders equity shall be written-down.
When the control power over an existing subsidiary has lost due to disposal of the investment in partial equity or
due to other reasone, the remaining equity shall be remeasured with reference to the fair value as at the date
when the control power got lost. The balance of the sum of the consideration obtained from disposal of the equity
and the fair value of the remaining equity less the portion of the net assets enjoyable in the original subsidiary
continuously calculated commencing from the date of purchase worked out based on the original shareholding
proportion is counted to the return on investment of the very period when the control power was lost. The other
comprehensive income in connection with the investment in the equity of the original subsidiary was altogether
transferred to the return on the investment in the very period when the control power was lost.
(2) The accounting treatment method for the event that the equity in the same subsidiary was bought in and then
sold out or sold out and then bought in again in two successive fiscal years should be disclosed.
Inapplicable
7. Recognition of Cash and Cash Equivalent
The Groups cash and cash equivalents include cash on hand, deposits which may be used for payment at any
time and investment held by the Group with short term (usually due within three months commencing from the
date of purchase), high liquidity, easy to be turned into cash with given amount and very small risk of change in
value.
8. Transactions in Foreign Currency and Foreign Currency Translation
(1) Transactions in Foreign Currency
Translation of Foreign Currency
In initial recognition of translation in foreign currency when incurs, the translation into amount in recording
currency based on the spot rate (which usually refers to the average of the foreign exchange rate published by the
Peoples Bank of China on the very day of incurrence); however, the foreign currency exchange business or
transaction involved foreign currency exchange incurred in the Company is converted into amount in recording
currency according to the exchange rate actually adopted.
Translation of monetary items in foreign currency and non-monetary items in foreign currency
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On the balance sheet day, for the monetary items in foreign currency, the spot rate on the balance sheet day is
used for translation; the exchange difference arising therefrom shall all counted to the current gain/loss.
The foreign currency based non-monetary items measured based on the historical cost is measured still based on
the function currency translated based on the spot exchange rate as of the date of incurrence of the transaction.
For the foreign exchange based non-monetary items measured based on the fair value, translation is made based
on the spot exchange rate as of the date of determination based on the fair value; the discrepancy between the
function currency amount for bookkeeping after translation and the original function currency for bookkeeping is
counted to the current gain and loss and is treated as the change of fair value (including exchange rate change),
or recognized as other comprehensive income and counted to the capital reserve.
(2) Translation for Financial Statements in Foreign Currency
In case the preparation of the consolidated financial statements involves overseas operation, if there is the
monetary item in foreign currency which substantially composes net investment for overseas operation, the
exchange difference arising from the change of exchange rate shall be stated in the item of “the translation
differene in foreign currency statement” of the owners equity; in handling the overseas operation, the exchange
difference is counted to the current gain and loss.
The financial statements in foreign currency for operation outside Mainland China are translated into statements in
Renminbi after conversion according to the following methods: all the asset and liability items in the balance sheet
are translated based on the spot rate on the balance sheet day; for the owners equity type items, except the item
of “retained earnings”, the other items are translated based on the spot exchange rate at the time of
incurrence.The income and expense items in the statement of profit are translated based on the current average
exchange rate on the date of transaction. The retained earnings at year beginning is the retained profit of the
previous year end after translation. The retained profit at year end is calculated and stated based on the items of
the profit distribution after translation. The difference between the asset items and liability items and the total of the
owners equity items after translation is recognized as other comprehensive income and separately stated under
the item of shareholders equity as the translation discrepancy of statements in foreign currency. In disposal of
operation outside Mainland China with the control power lost, the difference from translation of statements in
foreign currency stated under the item of owners equity in the balance sheet and in connection with foreign
operation is, all or based on the proportion of operation outside mainland China as disposed, charged to the
disposal of current gain and loss.
Foreign currency cash flow and cash flow of overseas subsidiaries are translated based on the current average
exchange rate as at the date when the cash flow incurs. The amount affected by the change of exchange rate
upon cash is used as the adjustment item and is separately presented in the cash flow statement.
The amount at year beginning and actual amount of the previous year are stated based on the amount of the
financial statements of the previous year after translation.
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9. Financial instruments
(1) Classification of Financial Instruments
Financial assets are classified into the following categories at the time of initial recognition: financial asset
measured based on the fair value and whose change is recorded in the current gain and loss, held-to-maturity
investment, loan, accounts receivable and available for sale asset. Financial asset is measured based on the fair
value at initial recognition. For the financial asset which is measured based on the fair value and the change is
charged to the current gain and loss, the relevant transaction expenses are directly charged to the current gain
and loss; for other types of financial asset, the relevant transaction expenses are charged to the initially
recognized amount. The Groups financial assets are mainly the accounts receivable.
Financial liabilities are classified into financial liabilities and other financial liabilities which are measured based on
the fair value at the time of initial recognition and whose change is charged to the current gain and loss. Financial
liabilities are measured based on the fair value at initial recognition. For the financial liabilities which are measured
based on the fair value and the change is charged to the current gain and loss, the relevant transaction expenses
are directly charged to the current gain and loss; for other types of financial liabilities, the relevant transaction
expenses are charged to the initially recognized amount. The financial liabilities of the Group are mainly the other
financial liabilities and financial guarantee contract.
(2) Basis for Recognition of Financial Instruments and Measurement Method
The Groups financial assets are mainly the accounts receivable.
Accounts receivable refer to the non-derivative financial assets without quotation in the active market and the
recoverable amount fixed or determinable. The financial assets classified as the account receivable by the Group
include the account receivable and other receivables, etc.
Actual interest rate is used for accounts receivable; the follow-up measurement is made based on the amortized
costs; the dividend or loss arising from the termination recognition, impairment occurrence or amortization are
charged to the current gain and loss.
The financial liabilities of the Group are mainly the other financial liabilities and financial guarantee contract.
① Other financial liabilities
Other financial liabilities undergo follow-up measurement based on the amortized cost by means of actual interest
rate method; the gain or loss arising from the termination of recognition or amortization, is charged to the current
gain and loss.
② Financial guarantee contract
For a financial guarantee contact of financial liability which is not specified for measurement based on the fair
value and its change being charged to the current gain and loss, the initial recognition is made based on the fair
value; after the initial recognition, the follow-up measurement shall be made for the higher of the amount and the
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initially recognized amount determined according to the Accounting Standards for Enterprises No. 13 –
Contingencies less the balance of the accumulated amortized amount as determined according to the Accounting
Standards for Enterprises No. 14 – Income.
(3) Basis for Recognition of Transfer of Financial Assets and Measurement Method
When a financial asset satisfies one of the following conditions, it is eventually recognized: ①The contract right
for receiving the cash flow of the financial assets is terminated; ② the financial asset has been transferred while
almost all the risks and remuneration in connection with the ownership of the financial asset has been transferred
to the party of transfer in; ③ the financial assets have been transferred although the enterprise has neither
transferred nor retained almost all the risks and remuneration to the ownership of financial assets but the control
over the financial asset has been given up.
In case the enterprise has neither transferred nor retained all the risks and rewards involved in the ownership of
the financial assets but has not given up the control over the financial assets, the concerned financial assets can
continue to be recognized based on the level of the financial assets transferred and the relevant liabilities shall be
recognized correspondingly. The level of the involved financial assets transferred refers to the level of risks the
enterprise is confronted with in change of the financial asset.
In case the overall transfer of the financial assets can satisfy the conditions of termination of recognition, the
balance between the book value of the financial assets as transferred, the consideration received due to the
transfer and the sum of the accumulative amount of change of the fair value recorded in other comprehensive
income is recordd in the current gain and loss.
If partial transfer of financial assets can satisfy the conditions for termination of recognition, the book value of the
financial assets transferred is apportioned based on its relevant fair value between the part with recognition
terminated and the part with recognition not terminated; and the difference between the sum of the consideration
received due to the transfer and the accumulative amount involved in change of the fair value of the part with
recognition terminated which should be recorded in the other comprehensive income and the aforesaid book
amount as apportioned is recorded in the current gain and loss.
(4) Termination of Recognition of Financial Liabilities
The present obligations of financial liabilities have been entirely or partially been eliminated before termination of
recognition of such financial liabilities or part of them. An agreement is concludd between the Group (the debtor)
and the creditor, the existing financial liabilities are replaced by means of undertaking the new financial liabilities
while the contract articles concerning the new financial liabilities and the existing financial liabilities are
substantially different, the recognition of the existing financial liabilities are terminated and at the same time the
new financial liabilities are recognized.
In case recognition of financial liabilities is entirely or partially terminated, the difference between the book value of
the part with recognition terminated and the consideration paid (including the non-cash assets transferred out or
the new financial liabilities as undertaken) is recorded in the current gain and loss.
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(5) Method for Recognition of the Fair Value of Financial Assets and Financial Liabilities
Method for Recognition of the Fair Value of Financial Assets and Financial Liabilities
Fair value refers to the amount involved in the assets exchange or settlement of obligation conducted between the
two parties of transaction on volunteer basis in a fair transaction. When there exists active market for financial
instruments, the Group determines the fair value with the quotation in the active market. Quotation in the active
market refers to the price easily and regularly accessable to the exchange, broker, guild, price service agent, etc.
and represents the transaction price actually incurred in the market in fair transaction. In case the financial
instruments do not exist in the active market, the Group uses the value estimation technique to determine its fair
value. The value estimation technique includes the price used in the latest market transaction conducted by the
parties familiar with the situation on volunteer basis with reference to the current fair value of substantially the
same other financial instruments, the cash flow discount method and option pricing model, etc.
(6) Provision for impairment of financial assets (including accounts receivable)
The Group inspects the book value of financial assets on the balance sheet date and makes provision for
impairment when there is objective evidence showing that impairment incurs in the financial asset.
(7) In case any undue held-to-maturity investment is reclassified as available-for-sale asset,
specify the intention of holding or the basis of the ability change taken place
Inapplicable
10. Recognition of Provision for Bad Debts of Accounts Receivable and Way of Provision
Accounts receivable consist of payment receivable and other receivables, etc. The Group checks the book value
of accounts receivable on the balance sheet day and provides reserve for impairment in case there exist following
objective evidences showing that accounts receivable have experienced impairment: ① A debtor is involved in
serious financial difficulty; ② The debtor breaches the contract, such as breaching contract in payment of interest
or the principal or delaying the payment, etc.; ③ Debtor may get bankrupt or conduct other financial
reorganization; ④ Other objective basis shows impairment incurred in the account receivable.
(1) Bad debt reserves for accounts receivable with insignificant single amount
The Group classifies an account receivable with
single amount exceeding CNY 800,000.00 and other
Criteria for basis or amount for judging significant single
receivable with single amount exceeding CNY
amount
500,000.00 as account receivable with significant
single amount.
The Group tests impairment of individual accounts
receivable with significant single amount, separately
Method for provision of reserve for bad debt with significant tests the financial assets without impairment incurred,
single amount on individual basis. including the impairment test of the portfolio of the
financial asset with similar credit risk characteristics.
The accounts receivable in which loss from
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impairment has been recognized in the individual test
shall no longer undergo impairment test in the
portfolio of the accounts receivable with similar credit
risk characteristics.
(2) Accounts receivable for which reserve for bad debt is provided based on grouping
Method of provision of
Grouping Description bad debt reserve based Basis for determining grouping
on grouping:
Grouping based on the
Age Analysis Length of the accounting age
accounting age
The Company does not provide bad debt reserve for the
reserve due from the employees, payment due from the
Grouping of the designated
Other methods subsidiaries in the consolidation range and the sales
accounts
revenue from the last settlement day of the supermarket
to the balance sheet day.
In grouping, aging analysis method has been used for provision of bad debt reserve:
Provision proportion of the
Age Provision proportion of other receivables (%)
accounts receivable (%)
Within 1 year (including 1
5% 5%
year)
1 to 2 years 10% 10%
2 to 3 years 30% 30%
Over 3 years 50% 50%
3 to 4 years 50% 50%
4 to 5 years 50% 50%
Over 5 years 50% 50%
In grouping, balance percentage is used for provision of bad debt reserve:
Inapplicable
In grouping, other method is used for provision of bad debt reserve:
Method Description
Grouping Description
The Group does not provide bad debt reserve for the reserve
receivable from employees, due from subsidiaries which should be
included in the consolidation range, the sales revenue from the last
Grouping of the designated accounts
settlement day of the supermarket to the balance sheet day in the
current year because such accounts are highly recoverable and are
quite impossible to turn into bad debt based on past experience.
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(3) Accounts receivable with insignificant single amount and provision of bad debt reserve
on individual basis
Reason of providing bad debt reserve on individual basis:
For the accounts receivable with insignificant single amount but having the following characteristics, the
Group makes separate impairment test. In case there is objective evidence showing that impairment has
taken place; the accounts receivable in which there exists evident indication showing that a debtor may
possibly be unable to implement the obligation of repayment.
Provision of bad debt reserve:
In case there is objective evidence showing that impairment has taken place, according to the bala nce of the
present value of future cash flow lower than the book value, loss from impairment is recognized and the
reserve for bad debt is provided, including the account receivable involved with dispute with the other party or
lawsuit or arbitration.
11. Inventories:
(1) Classification of Inventories
Inventories include raw materials, products-in-process, commodity stocks, etc.
(2) Pricing of Inventories Delivered
Inventories are priced based on the actual costs at the time of acquisition. Costs of inventories include purchase
cost, processing cost and other costs. Inventories are priced respectively according to the weighted average (for
FIYTA watch stocks), specific identification (for famous brand watch stocks) and first in first out (for raw materials
for FIYTA watches) at the time of procurement and delivery.
(3) Basis for determination of the net realizable value of inventories and the method for
provision of the reserve for price falling of inventories
The net realizable value of the inventories refers to the amount of the estimated sales prices of inventories less the
estimated costs up to the completion, the estimated sales costs and relevant taxes in daily activities. In
determining the realizable net value of inventories, with the acquired concrete evidence as the base, the purpose
of holding the inventories and the influence from the events after the balance sheet day are taken into
consideration at the same time. Including:
① For the inventories directly for sale, including the finished products and the materials for sale, in process of
normal production and operation, the realizable net value is the amount of the estimated sales price of the
inventories less the estimated sales costs and the relevant taxes;
② For the material inventories necessary to be processed, the realizable net value is the amount of the estimated
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sales price of the finished products produced in process of normal production and operation less the costs
predicted to incur at the time of finishing the work, the estimated sales expenses and the relevant taxes.
The Company provides reserve for price falling of the inventories classified based on the models of self-made
FIYTA watch inventories.
For the famous brand watches in distribution, reserve for price falling of inventories is provided based on the
individual items.
For the raw materials for FIYTA watches, based on the terminal sales status of FIYTA finished watches, reserve for
price falling of inventories is provided with interchangeability of spares and parts and specialized classification of
applications of materials taken into consideration.
The inventories are measured at the lower of cost and net realizable value on the balance sheet day. Reserve for
price falling of inventories is provided when the net realizable value is lower than the cost.
After reserve for price falling of inventories is provided, if the factors influencing the price falling of the inventories
have disappeared, which causes the realizable net value of the inventories to be higher than their book value, the
reserve for price falling of the inventories provided previously is reversed, the amount reserved is recorded in the
current gain and loss.
(4) Stock-taking System
The inventory system for the inventories is the perpetual inventory system.
(5) Amortization of low value consumables and packing materials
Low value consumables
Amortization method: amortization in lump sum
Packing materials
Amortization method: amortization in lump sum
12. Long-term equity investment
(1) Determination of initial investment cost
For long term equity investment formed from enterprise consolidation, such as the long term equity investment
obtained from consolidation of the enterprises under the same control, the share of the book value of the owners
equity in the parties consolidated as obtained on the date of consolidation is taken as the initial investment cost.
Through long term equity investment by means of consolidation of enterprises not under the same control, the
enterprise consolidation costs include the sum of the assets paid by the purchaser, the liabilities incurred or
undertaken, and the fair value of the eqity securities issued. The agency fees for audit, legal services, appraisal
and consulting services, etc. incurred in consolidation of enterprises and other relevant administrative expenses
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incurred to the purchaser should be recorded in the current gain and loss at the time of incurrence. The purchaser
should count the trading expenses of equity securities or liability securities issued as the consolidation
consideration to the amount of initial recognition of the equity securities or liability securities.
The other equity investment except the long term equity investment formed from enterprise consolidation is initially
measured based on the costs; the cost is determined based on the cash payment actually paid by the Group, the
fair value of the equity securities issued by the Group, value as specified in the investment contract or agreement,
the fair value or the original book value of the assets surrendered in process of non-monetary asset exchange, its
own fair value of the long term equity investment, etc. depending on the different ways of acquiring the long term
equity investment. Investment costs include the expenses, taxes and other necessary expenditures directly
connected with the acquisition of the long term equity investment.
(2) Follow-up Measurement and Gain and Loss Recognition
For a long term equity investment which does not have common control over or significant influence upon the
investee and there is no quotation in the active market and the fair value cannot be reliably measured, the
Company adopts the cost method for calculation. The long term investment which has common control over or
significant influence upon the investee, the equity method is used for calculation. The long term equity investment
which does not control or common control over or significant influence upon the investee while the fair value can
be reliably measured can be used as the financial asset available for sale in calculation.
In addition, for a long term equity investment in which the Company can exercise control over the investee, the
Company adopts the cost method for accounting.
① Long term equity investment calculated based on the cost method
In accounting based on the cost method, the long term eqity investment is priced based on the initial investment
costs, except the amount actually paid at the time when the investment is acquired, or the cash dividend or profit
already announced but not yet distributed involved in the consideration, the current return on investment is
recognized based on the amount of the cash dividend or profit announced for distribution by the investee
enjoyable by the Company as investor.
② Long term equity investment calculated based on the equity method
When the equity method is used for calculation, in case the initial investment cost of the long term equity
investment is greater than the fair value of the recognizable net asset of the investee enjoyable, the initial
investment cost of the long term equity investment shall not be adjusted; When the initial investment cost is less
than the investment, in case the fair value share of the recognizable net asset of the investee is enjoyable, its
difference is charged to the current gain and loss and at the same time the cost of the long term equity is adjusted.
If the equity method is used for calculation, the current investment gain/loss is the share of the net gain/loss
realized in the very year by the investee enjoyable or shareable. In confirming the share of the net gain and loss
enjoyable in the investee, the Group takes the fair value of various recognizable assets of the investee at the time
of obtaining the investment, and recognizes it after adjustment of the net profit of investee according to the
accounting policy of the Group and during the fiscal period. The part of the inside transaction gain and loss
unrealized between the Group, the associates and joint ventures attributable to the Group is calculated based on
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the shareholding proportion and is offset and the investment gain and loss are recognized on this basis. However,
the inside transaction loss unrealized incurred to the Group and the investee shall not be offset if it belongs to the
loss from impairment of the assets as assigned according to the Enterprise Accounting Standards No. 8 –
Impairment of Assets. For other comprehensive income of the investeess, the book value of the long term equity
investment is adjusted correspondingly and is recognized as other comprehensive income and recorded in the
capital reserve.
In recognizing the net loss shareable incurred to the investee, the book value of the long term equity investment
and the other long term equity which substantially composes the net investment in the investee is reduced to zero
as the maximum. In addition, if the Group has the obligation for assuming extra loss incurred to the investee, the
predicted liability is recognized based on the predicted obligation to be assumed and is charged to the current
investment loss. In case of the net profit realized by the investee in the afterwards period, the Group shall restore
the recognition of the share of profit enjoyable after the amount enjoyable has made up for the unrecognized loss.
③ Acquisition of the minority equity
In preparation of the consolidated financial statements, the difference between the long term equity investment
newly increased by purchase of minority equity and the enjoyable share of a subsidiarys net assets continuously
calculated commencing from the date of purchase (or date of consolidation) based on the newly increased
shareholding proportion is used to adjust the capital reserve; in case the capital reserve is not enough for
writing-down, the retained earnings is adjusted.
④ Disposal of long-term equity investment
In a consolidated financial statement, the parent company has partially disposed the long term equity investment
in its subsidiary without loosing its control power, the difference between the disposal income of the amount
enjoyable in the subsidiarys net assets corresponding to the long term equity investment disposed is counted to
the owners equity. In case that the parent company has partially disposed the long term equity investment in its
subsidiary has caused the parent company to have lost the control power over the subsidiary, it should be treated
according to the accounting policy as specified in the “method for preparation of consolidated financial statements”.
If a long term equity investment is disposed under other situation, for the equity disposed, the difference between
its book value and the consideration actually obtained is counted to the current gains and losses.
For the long term equity investment calculated based on the equity method, the other comprehensive income part
which was originally counted to the owners equity is transferred to te current gains and losses according to the
corresponding proportion. The remaining equity is recognized as long term equity investment or other relevant
financial assets based on its book value and measured afterwards according to te aforesaid accounting policy
concerning long term equity investment or financial assets. In case the remaining equity is calculated based the
equity method instead of the cost method, retroactive adjustment is made according to the relevant provisions.
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(3) The investee has the basis of joint control and significant influence
Control refers to the authority to decide the financial and operating policy of an enterprise according to which profit
may be achieved from the enterprises operating activities. Joint control refers to common control over some
economic activities according to the contract. Such control only exists when the investors unanimously approve
the important finance in connection with such economic activity and control power necessary to be shared in
operation decision-making. Significant influence is determined when the investor has the power in participating in
decision making on the investees financial and operation policies but cannot control or jointly control with other
party such decision making. In determining if to implement control over or exert significant influence upon an
investee, the potential voting elements, such as the current convertible debentures in the investee held by the
investor and other parties, the warranty available for implementation in the current period, can be taken into
consideration. (4) Method for impairment testing and provision of reserve for impairment
On every balane sheet day, the Group checks the long term equity investment and makes sure if there possibly
exist any sign of impairment. In case there exists impairment in such assets, their recoverable amount is estimated.
In case the recoverable amount of the asset is lower than its book value, provision for impairment of the asset is
made based on its difference and is recorded in the current gain and loss.
Loss from impairment of long term equity investment which once is confirmed shall not be reversed in the
afterwards fiscal periods.
13. Investment based real estate
Investment based real estate refers to the real estate held for the purpose of earning rental or added value of the
capital or both. It includes the housing, building, etc. already leased.
Investment based real estate is initially measured based on the cost. The follow-expenses in connection with the
investment based real estate are recorded in the investment based real estate costs in case the relevant economic
benefit may flow into the Company while the costs can be reliably measured. Other follow-up expenses are
recorded in the current gain and loss at the time of incurrence.
The Group adopts the cost model to make follow-up measurement of the investment based real estate and makes
depreciation or amortization according to the policy of coincidence with housing and building or land use right.
When the application of the investment based real estate is for self-use, the investment based real estate is
transferred to fixed asset or intangible asset commencing from the date of change. When the application of the
self-use real estate is changed into earning rental or increase of capital value, commencing from the date of
change, the fixed asset or intangible asset are transferred into investment based real estate. When conversion
takes place, for the investment based real estate measured by means of the cost module instead, the book value
before conversion shall be taken as the entry value after the conversion; for the investment based real estate
measured by means of fair value instead, the fair value as at the conversion date shall be taken as the entry value
after conversion.
When the investment based real estate is disposed or permanently withdrawn from use and it is predicted that it is
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unable to earn economic benefit, the recognition of the investment based real estate is terminated. The income
from disposal of investment based real estate, including sale, assignment, discarding or damage, is charged to the
current gain and loss after deduction of the book value and the relevant taxes.
14. Fixed assets
(1) Conditions for Recognition of Fixed Assets
Fixed assets refer to intangible assets held for the purpose of producing commodities, supplying labor, lease or
operation and management with service life exceeding over one fiscal year.
(2) Basis for recognition of the fixed assets under financing lease and the pricing method
Inapplicable
(3) Depreciation of different fixed assets
Fixed assets are initially measured based on the costs with the influence from the predicted discarding expenses
taken into consideration. Commencing from the next month after a fixed asset has reached the predicted usable
status, the average service life method is used to provide depreciation within the service life.
Depreciation Life
Categories Residual ratio (%) Annual depreciation rate (%)
(years)
Housing and buildings 20-35 5 2.7-4.8
Machines & equipment 10 5-10 9-9.5
Electronic equipment 5 5 19
Motor vehicle 5 5 19
Other equipment 5 5 19
Fixed assets under financing
-- -- --
lease:
Including: housing and
buildings
Machines & equipment
Electronic equipment
Motor vehicle
Other equipment
(4) Method for testing the impairment of fixed assets and provision of impairment reserve
For the non-current and non-financial assets, including fixed assets, construction-in-process, intangible assets
with limited service life, investment based real estate measured based on the cost method, the long term equity
investment in the subsidiaries, joint venture, associated enterprises, etc., the Group judges if there exists any sign
of impairment on the balance sheet day. If there exists the sign of impairment, the recoverable amount is
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estimated and impairment test is conducted. For the intangible assets with the goodwill and service undetermined
and the intangible assets which have not yet reached the serviceable status, regardless whether there exists any
sign of impairment, impairment test is conducted every year.
In case impairment test result shows that the recoverable amount of asset is lower than the book value, provision
for impairment is made based on the difference and is regarded in the loss for impairment. The recoverable
amount is the higher of the net amount of the fair value of the assets less the disposal expenses and the present
value of the predicted future cash flow. The fair value of assets is determined based on the sales agreement price
in fair transaction; in case there is no sales agreement but does exist active market of asset, the fair value is
determined according to the buyers offer of the asset; in case there exists neither sales agreement nor active
market of asset, the fair value of assets is estimated based on the best information obtainable. The disposal
expenses include legal expenses, relevant taxes, handling fee and direct expenses incurred before the asset
reaches the sellable status in connection with disposal of the assets. The present value the predicted future cash
flow of assets: according to the predicted future cash flow created in process of continuous application and final
disposal, choose the proper discount rate to determine the amount after discount. Provision for impairment of
asset is calculated and recognized based on the individual asset. In case it is difficult to make estimation of the
recoverable amount of individual asset, the recoverable amount of asset group is determined based on the asset
group which the asset belongs to. The asset group is the minimum grouping of assets which can independently
produce cash flow in.
For the goodwill separately presented in the financial statements, in process of impairment testing, the book value
of the goodwill is apportioned to the asset group or asset group grouping which is predicted to beneft from the
cooperativity of the enterprise consolidation. If the testing result shows that the recoverable amount of the asset
group or asset group grouping containing apportioned goodwill is lower than its book value, the corresponding
impairment loss is recognized. The amount of the impairment loss is first used to offset the book value of the
goodwill apportioned to the asset group or asset group grouping; then offset the book value of other assets
according to the proportion according to the proportion taken by the book value of various assets other than the
goodwill in the asset group or asset group grouping.
The loss from impairment shall not reverse the part whose value may be recovered in future once the impairment
of the aforesaid assets is recognized.
(5) Other Notes
The follow-up expenses in connection with fixed assets are recorded in the costs of fixed assets if the economic
benefit in connection with the fixed assets can highly probably flow into while the costs can be reliably measured
and the book value of the part replaced is terminated for recognition. Other follow-up expenses are recorded in the
current gain and loss at the time of incurrence.
The income from disposal of fixed assets, including sale, assignment, discarding or damage, is recorded in the
current gain and loss after deduction of the book value and the relevant taxes.
The Group rechecks the service life, predicted net residual value and depreciation method of fixed assets at least
at the end of a year; in case any change takes place, it is taken as change in accounting estimation.
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15. Construction-in-process
(1) Categories of construction-in-process
The cost of construction-in-process is determined based on the actual expenditures of the project, including
various engineering expenses incurred during the construction period and other relevant expenses, etc.
(2) Criteria and time point for carry-over of the construction-in-process into fixed asset
The construction-in-process is carried over to fixed asset when the works reaches the predicted applicable status.
(3) Impairment testing of construction-in-process and provision of the impairment reserve
For the non-current non-financial assets, including fixed assets, construction-in-process, intangible assets with
limited service life, investment based real estate measured based on the cost model, long term equity investment
in subsidiaries, joint ventures and associates, etc., the Group makes judgment on whether there exists sign of
impairment on the balance sheet day. If there does exist sign of impairment, the recoverable amount is estimated
and the impairment test is conducted. For the goodwill, intangible assets with indefinite service life, the intangible
assets which have not yet reached the serviceable status, regardless whether there exists any sign of impairment,
impairment test is conducted every year.
In case impairment test result shows that the recoverable amount of asset is lower than the book value, provision
for impairment is made based on the difference and is regarded in the loss for impairment. The recoverable
amount is the higher of the net amount of the fair value of the assets less the disposal expenses and the present
value of the predicted future cash flow. The fair value of assets is determined based on the price in the sales
agreement in fair trade. in case there is no sales agreement but does exist active market of asset, the fair value is
determined according to the buyers offer of the asset; in case there exists neither sales agreement nor active
market of asset, the fair value of assets is estimated based on the best information obtainable. The disposal
expenses include legal expenses, relevant taxes, handling fee and direct expenses incurred before the asset
reaches the sellable status in connection with disposal of the assets. The present value the predicted future cash
flow of assets: according to the predicted future cash flow created in process of continuous application and final
disposal, choose the proper discount rate to determine the amount after discount. Provision for impairment of
asset is calculated and recognized based on the individual asset. In case it is difficult to make estimation of the
recoverable amount of individual asset, the recoverable amount of asset group is determined based on the asset
group which the asset belongs to. The asset group is the minimum grouping of assets which can independently
produce cash flow in.
For the goodwill separately presented in the financial statements, in process of impairment testing, the book value
of the goodwill is apportioned to the asset group or asset group grouping which is predicted to beneft from the
cooperativity of the enterprise consolidation. For the goodwill separately presented in the financial statements, in
process of impairment testing, the book value of the goodwill is apportioned to the asset group or asset group
grouping which is predicted to beneft from the cooperativity of the enterprise consolidation. If the testing result
shows that the recoverable amount of the asset group or asset group grouping containing apportioned goodwill is
lower than its book value, the corresponding impairment loss is recognized. The amount of the impairment loss is
first used to offset the book value of the goodwill apportioned to the asset group or asset group grouping; then
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offset the book value of other assets according to the proportion according to the proportion taken by the book
value of various assets other than the goodwill in the asset group or asset group grouping.
The loss from impairment shall not reverse the part whose value may be recovered in future once the impairment
of the aforesaid assets is recognized.
16. Loan expenses
(1) Recognition of the capitalized loan cost
Loan expenses include the interest and additional expenses incurred by loans, and the exchange difference
incurred by foreign exchange loan.
(2) Duration of loan cost capitalization
For the loan expenses for purchase and construction or production of an asset directly attributable to that in
compliance with the capitalization conditions, capitalization starts when the asset expenses have incurred,
borrowing expenses have incurred, the purchase or production activity necessary for the asset to reach the
predicted usable or sellable status.
(3) Suspension of Capitalization
When the assets to be purchased/constructed or produced in compliance with capitalization conditions have
reached the predicted application status or status for sale, the borrowing costs stop being capitalized. The
remaining borrowing expenses are recognized in the very period of incurrence.
(4) Calculation of the Amount Involved in Capitalization of Borrowing Costs
Inapplicable
17. Biological Assets
Inapplicable
18. Oil and gas asset
Inapplicable
19. Intangible assets
(1) Pricing Method for Intangible Assets
Intangible asset refers to a non-monetary asset held or controlled by the Group with no physical form
recognizable.
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Intangible assets are initially measured based on the cost. Expenses in connection with intangible assets is
recorded in the intangible asset cost if the relevant economic benefit may possibly flow into the Group and its costs
may be reliably measured. Other expenditures are recorded in the current gain and loss at the time of incurrence.
Land use right as acquired is usually taken as intangible asset for accounting. For the buildings, such as plant
developed and constructed by the Company itself, the expenses for the relevant land use right and construction
costs of the building are calculated respectively as intangible asset and fixed asset. In case of outsourced housing
and building, the concerned costs shall be distributed between the land use right and building. If it is difficult to
make reasonable distribution, all shall be taken as fixed asset.
(2) Estimation of the service life of intangible assets with limited service life
The intangible assets with limited service life are amortized in average by stages by means of the straight line
method within the predicted service life commencing from the time of availability for application with the original
value less the predicted net residual value and the accumulated amount of the reserve for impairment already
provided. At the end of a year, the service life of an intangible asset with limited service life and the amortization
method are rechecked. In case change takes place, it shall be handled as the change of accounting estimate.
(3) Basis for judgment of intangible assets with indefinite service life
An intangible asset with indefinite service life is not amortized. The service life of and intangible asset with
indefinite service life is rechecked. If there is evidence showing that the duration of the economic benefit brought
about by the intangible asset for the enterprise is foreseeable, the estimated service life is amortized according to
the amortization policy of intangible assets with limited service life.
(4) Provision of reserve for impairment of intangible assets
For the non-current non-financial assets, including fixed assets, construction-in-process, intangible assets with
limited service life, investment based real estate measured based on the cost model, long term equity investment
in subsidiaries, joint ventures and associates, etc., the Group makes judgment on whether there exists sign of
impairment on the balance sheet day. If there does exist sign of impairment, the recoverable amount is estimated
and the impairment test is conducted. For the goodwill, intangible assets with indefinite service life, the intangible
assets which have not yet reached the serviceable status, regardless whether there exists any sign of impairment,
impairment test is conducted every year.
In case impairment test result shows that the recoverable amount of asset is lower than the book value, provision
for impairment is made based on the difference and is regarded in the loss for impairment. The recoverable
amount is the higher of the net amount of the fair value of the assets less the disposal expenses and the present
value of the predicted future cash flow. The fair value of assets is determined based on the sales agreement price
in fair transaction; in case there is no sales agreement but does exist active market of asset, the fair value is
determined according to the buyers offer of the asset; in case there exists neither sales agreement nor active
market of asset, the fair value of assets is estimated based on the best information obtainable. The disposal
expenses include legal expenses, relevant taxes, handling fee and direct expenses incurred before the asset
reaches the sellable status in connection with disposal of the assets. The present value the predicted future cash
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flow of assets: according to the predicted future cash flow created in process of continuous application and final
disposal, choose the proper discount rate to determine the amount after discount. Provision for impairment of
asset is calculated and recognized based on the individual asset. In case it is difficult to make estimation of the
recoverable amount of individual asset, the recoverable amount of asset group is determined based on the asset
group which the asset belongs to. The asset group is the minimum grouping of assets which can independently
produce cash flow in.
For the goodwill separately presented in the financial statements, in process of impairment testing, the book value
of the goodwill is apportioned to the asset group or asset group grouping which is predicted to beneft from the
cooperativity of the enterprise consolidation. If the testing result shows that the recoverable amount of the asset
group or asset group grouping containing apportioned goodwill is lower than its book value, the corresponding
impairment loss is recognized. The amount of the impairment loss is first used to offset the book value of the
goodwill apportioned to the asset group or asset group grouping; then offset the book value of other assets
according to the proportion according to the proportion taken by the book value of various assets other than the
goodwill in the asset group or asset group grouping.
The loss from impairment shall not reverse the part whose value may be recovered in future once the impairment
of the aforesaid assets is recognized.
(5) Specific criteria for division between the research stage and development stage of the
Company’s internal R & D projects
Expenditures for the Groups internal research and development projects are divided into the expenditure of the
research stage and that for the development stage.
The expenses at the development stage which can satisfy the following conditions at the same time are
recognized as intangible asset and that which cannot satisfy the following conditions are recorded in the current
gain and loss at the development stage.
① It is technically feasible to finish such intangible assets so as to make it useable or sellable;
② there is intention for fulfilling that intangible assets and application or sales;
③ The ways of intangible assets to produce economic benefit, including being able to prove that there exists
market for the products produced by using such intangible assets or there exists market for intangible asset itself;
in case intangible asset shall be used internally, it can be proved useful.
④ There is sufficient support in terms of technology, financial resource and other resources so as to fulfill the
development of intangible asset and have the ability to use or sell such intangible assets;
⑤ Expenses attributable to the development stage of such intangible assets can be reliably measured.
In case it is impossible to distinguish the expenses at the research stage from that at the development stage, the R
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& D expenses incurred shall all be recorded in the current gain and loss.
(6) Calculation of expenses for internal R & D projects
Expenses for the research stage is recorded in the current gain and loss at the time of incurrence.
20. Long-term expenses to be apportioned
Long-term expenses to be apportioned refer to various expenses that have already incurred and shall be borne in
the current and future periods with the amortization term of over 1 year (with 1 year exclusive). Long term
expenses to be apportioned are amortized based on the straight line method during the predicted beneficial period
and the amortization term is usually 2 – 5 years.
21. Assignment of the assets with buy-back conditions
Inapplicable
22. Predicted liabilities
(1) Criteria for recognizing the estimated liabilities
Predicted liabilities shall be recognized when the obligation in connection with the contingent events complies with
the following conditions: A. such an obligation is a current one the Company should assume; B. Implementation of
such obligation may possibly cause flow-out of economic benefit ; C. The amount involved in such obligation can
be reliably measured.
(2) Method for measuring the predicted liabilities
On the balance sheet day, with consideration of the risks in connection with the contingent matters, uncertainty,
time value of currency, etc., the predicted liabilities are measured according to the best estimated amount payable
in implementation of the present obligations.
In case the determined liabilities payable should completely or partially be compensated by a third party, while the
amount of compensation can be basically confirmed receivable, it should be individually recognized as assets.
However, the amount of compensation as recognized should not exceed the par value of the liabilities as
predicted.
23. Share payment and equity instrument
(1) Categories of share payment
Inapplicable
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(2) Method for determining the fair value of equity instrument
Inapplicable
(3) Basis for determining the best estimation of the executable equity instrument
Inapplicable
(4) Accounting process for implementation, amendment and termination of the
share-based payment scheme
Inapplicable
24. Repurchasing the Company’s shares
Inapplicable
25. Revenues
(1) Specific judgment criteria for the time of recognizing the revenue from sales of goods
A. Sales of goods
Sales income is recognized when the major risk and remuneration involved in the ownership of goods have been
transferred to the buyer, with neither the successive management power general in connection with the ownership
retained nor effective control over the goods already solve; the income amount may be reliably measured, the
relevant economic benefit may flow into the enterprise; the relevant costs incurred or to incur can be reliably
measured.
B. Income from labor services
The results of labor service transactions offered on the balance sheet date can be reliably estimated, the labor
service income is recognized based on the percentage of the work completed. The completion progress of labor
service transaction is determined based on the proportion of the labor service already provided in the total labor
service volume.
Reliable measurement of the result of the labor service transaction provided refers to that it can satisfy at the
same time: ① the amount of the income can be reliably measured; ② the concerned economic benefit may
highly possibly flow into the Company; ③ the completion of the transaction can be reliably determined; ④ the
costs incurred or to incur can be reliably measured.
In case the result of a labor service transaction cannot be reliably measured, the labor service income is
recognized based on the labor cost which has incurred and is predicted to be compensable and the labor service
cost already incurred is taken as the current expenses. The labor cost already incurred shall not be recognized as
income if it is predicted to be impossible to be compensated.
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C. Income from properties
The amount of income from lease of properties is determined on the lease date as specified in the lease contract
or agreement (rental-free period should be taken into consideration if there is rental-free period) and the amount of
rental and the income from the properties leased is recognized when the concerned rental or the evidence of
receipt has been received.
(2) Basis for recognition of Income from use right of the assigned asset
A. Royalty Income
The income is recognized based on accrual basis according to the relevant contract or agreement.
B. Interest income
Interest income is determined according to the time the borrowers using the Groups monetary fund and the actual
interest rate.
(3) Basis and method for determining the contract completion progress when the income
from labor services and income from construction contract based on
percentage-of-completion method
Inapplicable
26. Government subsidy
(1) Types
Government subsidy refers to monetary asset or non-monetary asst obtained from the government free of charge
but does not include the capital invested by the government as the Companys owner. The government subsidy
can be divided into the government subsidy in connection with asset and government subsidy in connection with
income.
(2) Accounting Process
The governmental subsidy is measured based on the amount received or receivable if it is monetary asset. The
government subsidy is measured based on the fair value if it is a non-monetary asset; when the fair value cannot
be obtained, it is measured based on the nominated amount. The government subsidy measured based on the
nominal amount is directly recorded in the current gain and loss.
Asset related governmental subsidy is recognized as deferred income, is distributed in average over the service
life of the related assets and recorded in the current gain and loss. The government subsidy in connection with
income is recognized as deferred income if it is used for compensating the Companys relevant expenses or
losses in the afterward term and is charged to the current gain and loss during the recognition of the relevant
expenses; or directly charged to the current gain and loss if it is used for compensating the relevant expenses or
losses already incurred in the Company.
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When the recognized government subsidy needs to be returned, if there exists the relevant deferred income
balance, the book balance of the deferred income should be written-down and the excessive part is recorded in
the current gain and loss; if there exists no relevant deferred gain and loss, it is directly recorded in the current
gain and loss.
27. Deferred income tax asset and deferred income tax liability
(1) Basis for recognition of deferred income tax assets
The Company measures the current income tax liability or asset formed in the current period or the previous
period according to the predicted payable or reimbursed income tax amount calculated according to the tax law.
The current income tax cost is calculated based on the amount of taxable income after adjustment of the pre-tax
accounting profit in the report year according to the tax law.
The difference between the book value of some asset and liability items and the tax base as well as the provisional
discrepancy arising from the difference between the book value of the tax base items which has not been
recognized as asset and liability but can be determined according to the tax law and the tax base are recognized
as deferred income tax asset and deferred income tax liability by means of the balance sheet liability method.
For the offsetable provisional difference in connection with the initial recognition of the asset or liability arising from
the transaction which is neither enterprise consolidation nor may influence the accounting profit and taxable
income amount (or can be used to offset loss), the pertinent deferred income tax asset shall not be recognized. In
addition, for the offsetable provisional difference in connection with investment in subsidiary, associate and joint
venture, if the provisional difference may not possibly be reservable in the foreseeable future or cannot be
possibily obtained and used for offsetting the taxable income amount of the provisional difference in future, the
pertinent deferred income tax asset shall not be recognized. Except the aforesaid exceptional case, the Group
recognizes the deferred income tax asset arising from the other offsetable provisional difference within the limit of
the taxable income amount which can be used to offset the offsetable provisional difference. For the offsetable
loss and tax credit in the years after carry-forward, the pertinent deferred income tax asset is recognized within the
limit of the future taxable income amount which may possibly be used for offsetting the offsetable loss and tax
credit. On the balance sheet day, the book value of the deferred income tax asset is rechecked. In case it is highly
impossible to get enough taxable income amount to offset the interest of the deferred income tax asset in the
future period, the book value of the deferred income tax assets is deduced. When it is highly possible to get
enough taxable income amount, the deducted amount is reversed.
(2) Basis for recognition of deferred income tax liabilities
For the provisional difference of payable taxes in connection with the initial recognition of goodwill and in
connection with the initial recognition of assets or liabilities arising from the transactions which are neither
enterprise consolidation and nor influence the accounting profit and taxable income amount (or can be used to
offset loss) at the time of incurrence, the pertinent deferred income tax liability shall not be recognized. In addition,
for the taxable provisional difference in connection with investment in subsidiaries, associates and joint ventures, if
the Group can control the time of provisional difference reversal while such provisional difference may not be
possibly reversed in the foreseeable future, the pertinent deferred income tax liability shall not be recognized
either. Except the aforesaid exceptional case, the Group recognizes the deferred income tax liability arising from
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the provisional difference of all other payable taxes.
28. Operating Lease and Financing Lease
(1) Accounting process for operating lease
The Group records the operational lease business as the tenant
Rental payment of operational lease is recorded in the relevant asset cost or current gain and loss based on the
straight line method over various fiscal periods within the lease term. The initial direct expense is recorded in the
current gain and loss. Contingent rental is recorded in the current gain and loss when it actually incurs.
The Group records the operating lease business as the lessor
The rental income of the operational lease is recorded in the current gain and loss according to the straight line
method in different periods within the lease term. The initial direct expense with bigger amount is capitalized at the
time of incurrence and is recorded in the current gain and loss periodically according to the same base in
recognizing the rental income during the lease term; other initial direct expense with smaller amount is recorded in
the current gain and loss at the time of incurrence. Contingent rental is recorded in the current gain and loss when
it actually incurs.
(2) Accounting process for financing lease
Financing lease is actually the lease in which all the risks and remuneration in connection with the ownership of
the asset has been transferred and whose ownership may be either eventually transferred or possibly not
transferred. Operating lease refers to the leases other than financing lease. The Groups leases refer to the
operational lease.
29. Assets for sale held by the Company
(1) Criteria for recognizing assets for sale held by the Company
Inapplicable
(2) Accounting process for assets for sale held by the Company
Inapplicable
30. Asset securitization business
Inapplicable
31. Hedging Accounting
Inapplicable
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32. Change in the Accounting Policy and Accounting Estimates
Is there any change in the main accounting policy and accounting estimates in the reporting period?
No
(1) Change of accounting policy
Is there any change in the main accounting policy in the reporting period?
No
(2) Change in the Accounting Estimate
Is there any change in the main accounting estimates in the reporting period?
No
33. Correction of previous accounting errors
Have any previous accounting errors been found in the reporting period?
No
(1) Retrospective Restatement
Have any previous accounting errors been found by means of retroactive restatement in the reporting period?
No
(2) Prospective Application
Have any previous accounting errors been found by means of prospective application in the reporting period?
No
34. Other Principal Accounting Policies, Accounting Estimates and Preparation of the
Consolidated Financial Statements
Inapplicable
(V) Taxes
1. Main taxes and tax rates applicable to the Company
Taxes Basis for taxation Tax rate
The Company and its domestic
Value-added tax subsidiaries are general VAT 17%
payers and the taxable VAT is the
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balance of the current output VAT
less the offsetable input VAT.
For the imported or self-made
high-grade watches, the Company
Consumption tax and its domestic subsidiaries pay 20%
consumption tax based on 20% of
the taxation base.
The Company and its subsidiaries
pay business tax for the housing
Business tax rental income, income from offering 5%
labor service and the income from
use of the assigned assets.
The Company and its subsidiaries
in Shenzhen pay urban
maintenance and construction tax
at the rate of 1% of the turnover tax
actually paid before December 31,
2010 and 7% of the turnover tax
Urban maintenance and construction tax 7%
actually paid commencing from
December 31, 2010; and the
subsidiaries outside Shenzhen pay
urban maintenance and
construction tax at the rate of 7% of
the turnover tax
Enterprise income tax
Income tax rates applicable to various branch offices and factories
The Company and its Subsidiaries Income tax rate of Income tax rate
the reporting period of the previous
year
The Company 25% 24%
Harmony 25% 24%
Shenzhen FIYTA Sophisticated Timepieces Manufacture Co., Ltd. 25% 15%
(Manufacture Co.)
Shenzhen Harmony World Watches Center Co., Ltd. (World Watches 25% 24%
Center)
FIYTA Hong Kong Limited 16.5% 16.5%
68-Station Limited 16.5% 16.5%
NATURE ART LTD 16.5% 16.5%
PROTOP LTD 16.5% 16.5%
World Watches International 16.5% 16.5%
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Shenzhen FIYTA Technology Co., Ltd. (FIYTA Technology) 25% 25%
Shenzhen Xiangji Commercial & Trade Co., Ltd. (Trade Co.) 25% 25%
Beijing Henglianda Timepiece Co., Ltd. (Henglianda) 25% 25%
Kunming Lishan Department Store Co., Ltd. (Lishan Department Store) 25% 25%
Harbin World Watches Distribution Co., Ltd. (Harbin Co.) 25% 25%
Shenzhen CATIC Culture Communication Co., Ltd. (Culture Co.) 25% 25%
Emile Chouriet (Shenzhen) Co., Ltd. (Emile Chouriet Shenzhen) 25% 25%
FIYTA Sales Co., Ltd. (FIYTA Sales Co.) 25% 25%
Liaoning Hengdarui Commercial & Trade Co., Ltd. (Hengdarui) 25% 25%
The Swiss Company 30% 30%
2. Preferential Tax Policies and Approval Documents
Inapplicable
3. Other Notes
Inapplicable
(VI) Enterprise Consolidation and Consolidated Financial Statements
General note to enterprise consolidation and consolidated financial statements:
1. Subsidiaries
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(1) Subsidiaries Acquired through Establishment or Investment
In CNY
Balance of
the
owners
equity of
the parent
company
Amount in offsetting
Balance of
the the loss
other items
minority shared by
which
shareholde minority
Full Name substantiall Shareholdi Are the
Place of Actual Proportion Minority rs equity shareholde
of Subsidiary Business Registered Business y ng statements
Registratio Currency investment of voting shareholde used for rs in the
Subsidiarie type type Capital Scope composes proportion consolidat
n at year end power (%) rs equity offsetting reporting
s net (%) ed (Y/N)
minority period
investment
shareholde exceeding
in the
rs gain the share
subsidiary
and loss enjoyed in
the
owners
equity at
year
beginning
Shenzhen Equity-cont 600,000,00 Purchase 601,307,20
Shenzhen Commerce CNY 100% 100% Yes
Harmony rolled 0.00 and sales 0.00
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World of watches
Watches and spares
Center and parts,
Co., Ltd. repairing
service
Producing
various
Shenzhen timepieces
FIYTA and
Sophisticat movement
ed Equity-cont Manufactur 10,000,000 s, spares 10,000,000
Shenzhen CNY 100% 100% Yes
Timepiece rolled e .00 and parts, .00
s sophisticat
Manufactur ed
e Co., Ltd. timepieces
and repair
service
High grade
clocks and
watches,
Shenzhen glasses,
World ornaments,
Equity-cont 2,800,000. 1,400,000. 14,000,000
Watches Shenzhen Commerce CNY gifts, general 50% 50% Yes
rolled 00 00 .00
Center merchandise
Co., Ltd. and
handicrafts
(excluding
gold and
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silver jewelry
FIYTA
Equity-contr 65,060,000 Trade and 65,060,000
Hong Kong Hong Kong Commerce HKD 100% 100% Yes
olled .00 investment .00
Limited
Sales of
68-Station Equity-cont 3,800,000. watches, 3,000,000. 12,262,000
Hong Kong Commerce HKD 60% 60% Yes
Limited rolled 00 domestic 00 .00
trade
Harbin Purchase
World and sales
Watches Equity-cont of
Distribution rolled Harbin Commerce 500,000.00 CNY timepieces 500,000.00 100% 100% Yes
Co., Ltd. and parts;
(Harbin timepiece
Co.) repairing
Sales of
timepieces
Beijing
,
Henglianda Equity-cont 30,000,000 31,300,000
Beijing Commerce CNY accessorie 100% 100% Yes
Timepiece rolled .00 .00
s and
Co., Ltd.
repairing
service
R&D,
FIYTA production
Technology Equity-cont Manufactur 10,000,000 and sales 10,000,000
Shenzhen CNY 100% 100% Yes
Developme rolled e .00 of .00
nt Co., Ltd. timepieces
,
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production,
machining,
sales and
technical
developme
nt of
sophisticat
ed parts.
Sales of
clocks and
watches,
Shenzhen
gifts,
Xiangji
Equity-cont 5,000,000. relevant 5,000,000.
Commerci Shenzhen Commerce CNY 100% 100% Yes
rolled 00 information 00
al & Trade
consulting
Co., Ltd.
and other
domestic
trade
Shenzhen
Cultural
CATIC
activity
Culture Equity-cont
Shenzhen Commerce 500,000.00 CNY planning, 500,000.00 100% 100% Yes
Communic rolled
advertising
ation Co.,
services
Ltd.
Emile Wholesale,
Chouriet Equity-cont 5,000,000. import and 5,000,000.
Shenzhen Commerce CNY 100% 100% Yes
(Shenzhen rolled 00 export of 00
) Co., Ltd. watches,
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watch
spares and
parts,
jewelry,
ornaments
and the
supplemen
tary
business;
after-sale
repairing
service of
watches.
HARMON
Y World Retail and
Equity-cont 10,000,000 10,000,000
Watches Hong Kong Commerce HKD repairing 100% 100% Yes
rolled .00 .00
Internation services
al Limited
Design, R &
D, sales of
various
watches,
FIYTA
Equity-cont 50,000,000 timekeeping 50,000,000
Sales Co., Shenzhen Commerce CNY 100% 100% Yes
rolled .00 instruments .00
Ltd.
and spares
and parts,
sales of
jewelry,
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ornaments,
(except the
items
forbidden by
the law,
administrativ
e
regulations,
the
decisions of
the State
Council; the
restrictive
items are
subject to
the permit)
(2) Subsidiaries under the Common Control Acquired through Enterprise Consolidation
In CNY
Balance of Amount in Balance of the
other items the minority owners equity of
Full
which shareholder the parent company
Name Place Actual Sharehold Are the
Subsi Busin substantially Proportion of Minority s equity offsetting the loss
of of Registere Curr investmen ing statements
diary ess Business Scope composes voting power shareholder used for shared by minority
Subsi Regis d Capital ency t at year proportion consolidated
type type net (%) s equity offsetting shareholders in
diarie tration end (%) (Y/N)
investment minority the reporting period
s
in the shareholder exceeding the
subsidiary s gain and share enjoyed in
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loss the owners equity
at year beginning
Wholesale, retail
and repairing of
Liaoni
watches and
ng
accessory parts,
Heng
electronic
darui Equity
products,
Com -contr Shen Com 50,000,0 56,100,00
CNY communication 100% 100% Yes
merci olled yang merce 00.00 0.00
equipment and
al &
materials, general
Trade
merchandise,
Co.,
property
Ltd.
management and
lease
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Other notes to the subsidiaries acquired through consolidation of the enterprises under the common control:
The 29th Meeting of the Sixth Board of Directors of FIYTA Holdings Ltd. held on December 14, 2011 approved Proposal
on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World Watches
Center Co., Ltd. and the Extraordinary Shareholders Meeting held on January 4, 2012 reviewed and approved the
Proposal on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World
Watches Center Co., Ltd. According to the Agreement on Assignment of the Equity to the Third Party and the Contract on
Equity Assignment, the Company paid CNY 28.05 million, the balance of the payment for the equity acquired equal to 50%
of the total payment in February, 2012; the total payment involved in the equity acquisition was CNY 56.10 million. By then,
the Company had finished acquisition of 100% equity in Hengdarui. As the three parties participated in the assignment of
the equity, namely the Company, China National Aero-Technology Corporation Shenzhen, the Companys actual
controlling shareholder, and CATIC Trust Co., Ltd. are related parties. Therefore, in the reporting period, Hengdarui, as an
enterprise under common control, has been included in the consolidated statement range and the consolidation date was
February 28, 2012.
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(3) Subsidiaries not under the Common Control Acquired through Enterprise Consolidation
In CNY
从母公司所有者权益冲
减子公司少数股东分担
的本期亏损超过少数股
Amount in 东在该子公司年初所有
Balance of
the minority 者权益中所享有份额后
other items
shareholder 的余额
which Minorit
Place Actual Are the s equity Balance of the owners
Subsidi Regist substantially Shareholdin Proportio y
Full Name of of Busine Curr Business investmen statements used for equity of the parent
ary ered composes g proportion n of voting shareh
Subsidiaries Registr ss type ency Scope t at year consolidated offsetting company offsetting the
type Capital net (%) power (%) olders
ation end (Y/N) minority loss shared by minority
investment equity
shareholder shareholders in the
in the
s gain and reporting period
subsidiary
loss exceeding the share
enjoyed in the owners
equity at year beginning
Domestic
Kunming Lishan Equity-
trade,
Department Store controll Kunmi Comm 5,000,0 1,200,000
CNY materials 100% 100% Yes
Co., Ltd. (Lishan ed ng erce 00.00 .00
supply
Department Store)
and sales
Equity- Switzer Comm 1,000,0 Productio
Montres Chouriet SA EUR 100% 100% Yes
controll land erce 00.00 n,
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ed manufact
ure and
sales of
Emile
Chouriet
watches
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2. Operating entities with the control power formed by special purpose entity or through
entrusted operation or tenancy.
According to the equity trust agreement concluded between 68-Station Limited, one of FIYTA Hong Kongs subsidiaries
and the trustee of NATURE ART LTD and PROTOP LTD on December 10, 2009, 68-Station, as the trustor, holds the right
to earnings of the shares, equity, and the relevant rights of LIANGYA and BAODING, and the contractual trustee agreed to
assign their rights at any time according to the trustors instructions. 68-Station thus held the control power over LIANGYA
and BAODING which were therefore put in the consolidation scope of 68-Station.
In CNY
Major business dealings Ending balance of the major assets and liabilities
Description
with the Company recognized in the consolidated statements
June, 2012:
Purchase of fashion brand
NATURE ART LTD
watches
Current assets 638,618.61
Non-current assets
Current liabilities 479,421.62
Net assets 159,196.99
End of 2011:
Purchase of fashion brand
NATURE ART LTD
watches
Current assets 308,745.37
Non-current assets
Current liabilities 344,628.57
Net assets -45,080.87
June, 2012:
Purchase of fashion brand
PROTOP LTD
watches
Current assets 928,875.71
Non-current assets
Current liabilities 708,922.06
Net assets 219,953.65
End of 2011:
Purchase of fashion brand
PROTOP LTD
watches
Current assets 130,257.10
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Non-current assets
Current liabilities 50,304.79
Net assets 81,932.93
3. Note to the change of the consolidation scope
Note to the change of the consolidated statement scope:
In the reporting period, as an enterprise under the common control in the Group merged Hengdarui, the consolidation
scope in the reporting period correspondingly increased.
In comparison with the previous year, a new entity was additionally consolidated in the reporting period. The reason was
that:
th
The 29 Meeting of the Sixth Board of Directors of FIYTA Holdings Ltd. held on December 14, 2011 approved Proposal on
Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World Watches
Center Co., Ltd. and the Extraordinary Shareholders Meeting held on January 4, 2012 reviewed and approved the
Proposal on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World
Watches Center Co., Ltd. According to the Agreement on Assignment of the Equity to the Third Party and the Contract
on Equity Assignment, the Company paid CNY 28.05 million, the balance of the payment for the equity acquired equal to
50% of the total payment in February, 2012; the total payment involved in the equity acquisition was CNY 56.10 million. By
then, the Company had finished acquisition of 100% equity in Hengdarui. As the three parties participated in the
assignment of the equity, namely the Company, CATIC Shenzhen Company Limited (“CATIC Shenzhen”), the Companys
actual controlling shareholder, and CATIC Trust Co., Ltd. are related parties. Therefore, in the reporting period, Hengdarui,
as an enterprise under common control, has been included in the consolidated statement range and the consolidation
date was February 28, 2012.
In comparison with the previous year, no consolidated entity was reduced in the reporting year/period. The reason was
that:
In the reporting period, no company included in the consolidation was reduced.
4. Principal(s) newly included in the consolidation in the reporting period and principal(s) no
longer included in the consolidation in the reporting period
Subsidiaries, special purpose principals and operating entities operated by means of commission or lease newly put in the
consolidation in the reporting period
In CNY
Net profit in the reporting
Name Net asset at the end of the period
period
Hengdarui 31,819,300.87 -3,041,583.64
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Subsidiaries, special purpose principals and operating entities operated by means of commission or tenancy no longer
included in the consolidation in the reporting period
Inapplicable
5. Consolidation of the enterprises under the common control occurred in the reporting period
In CNY
Cash flow from
Revenue from the
Net profit from the operating activities
Basis of judgment beginning of the
reporting period of from the reporting
of consolidation of Actuall controller of reporting period for
Consolidatee the consolidation to period of
enterprises under the common control consolidation to the
the date of consolidation to the
the same control date of
consolidation date of
consolidation
consolidation
According to the
Agreement on
Assignment of the
Equity to the Third
Party and the
Contract on Equity
Assignment, the
Company paid CNY
28.05 million, the
balance of the
payment for the
equity acquired
equal to 50% of the
China National
total payment in
Aero-Technology
Hengdarui February, 2012; the 625,000.00 -2,130,265.54 -10,210,400.94
Corporation
total payment
Shenzhen
involved in the
equity acquisition
was CNY 56.10
million. By then, the
Company had
finished acquisition
of 100% equity in
Hengdarui. As the
three parties
participated in the
assignment of the
equity, namely the
Company, CATIC
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Shenzhen
Company Limited
(“CATIC
Shenzhen”), the
Companys actual
controlling
shareholder, and
CATIC Trust Co.,
Ltd. are related
parties. Therefore,
in the reporting
period, Hengdarui,
as an enterprise
under common
control, has been
included in the
consolidated
statement range
6. Consolidation of the enterprises not under the common control incurred in the reporting
period
Inapplicable
7. Subsidiary reduced due to loss of control power resulting from sales of equity in the reporting
period
Inapplicable
8. Counterpurchase incurred in the reporting period
Inapplicable
9. Merger incurred in the reporting period
Inapplicable
10. The conversion rate of the principal statement items of the overseas operating entities
Assets and Liabilities
Items
June 6, 2012 December 31, 2011
FIYTA Hong Kong Limited HKD 1 = CNY 0.8152 HKD 1 = CNY 0.8107
World Watches International HKD 1 = CNY 0.8152 HKD 1 = CNY 0.8107
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The Swiss Company CHF 1 = CNY 6.5900 CHF 1 = CNY 6.7085
Revenue, expenses and cash flow items
Items
Jan to Jun, 2012 2011
FIYTA Hong Kong Limited HKD 1 = CNY 0.8130 HKD 1 = CNY 0.8308
World Watches International HKD 1 = CNY 0.8130 HKD 1 = CNY 0.8308
The Swiss Company CHF 1 = CNY 6.6493 CHF 1 = CNY 6.8824
(VII) Notes to the principal items in the consolidated statements
1. Monetary funds
In CNY
End of the Reporting Period Amount at the beginning of the reporting period
Conve
Items Amount in foreign Amount in Conversio
rsion Amount in CNY Amount in CNY
currency foreign currency n rate
rate
Cash on hand -- -- 677,749.45 -- -- 588,590.81
CNY -- -- 637,450.58 -- -- 438,066.80
6.324
USD 2,806.00 17,747.68 306.00 6.3009 1,928.08
9
0.815
HKD 7,794.65 6,354.20 14,105.81 0.8107 11,435.58
2
EUR 559.45 7.871 4,403.44 3,959.45 8.1625 32,319.01
9.816
GBP 110.00 1,079.86 110.00 9.7116 1,068.28
9
CHF 1,625.75 6.59 10,713.69 15,341.75 6.7085 102,920.13
MYR 414.00 1.9889 852.93
Bank deposit: -- -- 209,559,779.50 -- -- 179,370,584.08
CNY -- -- 201,905,064.96 -- -- 152,109,973.23
6.324
USD 205,237.05 1,298,103.79 195,760.73 6.3009 1,233,468.78
9
0.815
HKD 6,729,049.89 5,484,223.43 31,352,088.52 0.8107 25,417,138.16
2
CHF 132,380.47 6.59 872,387.32 90,930.00 6.7085 610,003.91
Other Monetary Fund: -- -- 70,355.13 -- -- 13,255.13
CNY -- -- 70,355.13 -- -- 13,255.13
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Total -- -- 210,307,884.08 -- -- 179,972,430.02
2. Transactional financial assets
(1) Transactional financial assets
Inapplicable
(2) Transactional financial assets with restricted realization
Inapplicable
(3) Note to the hedging instrument and the related hedging transaction
Inapplicable
3. Notes receivable
Inapplicable
(2)
Notes receivable pledged at the end of the reporting period
Inapplicable
(3) Notes that are transferred into accounts receivable as the issuer fails to keep promise, and
that have been endorsed to any other party by the Company but are still undue at the end of the
reporting period
Inapplicable
4. Dividends receivable
Inapplicable
5. Interest receivable
Inapplicable
6. Accounts receivable
(1) Disclosure based on types of accounts receivable
In CNY
Categories End of the reporting period Beginning of the reporting period
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Book Balance Bad debt reserve Book Balance Bad debt reserve
Proportion Proportion Proportion Proportion
Amount Amount Amount Amount
(%) (%) (%) (%)
Accounts receivable with
significant single amount 10,988,31 10,988,31 10,988, 10,988,318.
2.71% 100% 3.47% 100%
and provision of bad debt 8.49 8.49 318.49 49
reserve on individual basis
Accounts receivable for which bad debt reserve has been provided based on the grouping
Grouping based on the 139,794,2 4,548,019. 99,639, 4,552,318.3
34.43% 3.25% 31.46% 4.57%
accounting age 48.76 66 705.01 6
Grouping of the 222,985,4 173,813
54.92% 54.89%
designated accounts 99.65 ,381.72
362,779,7 4,548,019. 273,453 4,552,318.3
Sub-total of Groupings 89.35% 1.25% 86.35% 1.66%
48.41 66 ,086.73 6
Accounts receivable with
insignificant single amount 32,229,44 32,229,44 32,229, 32,229,445.
7.94% 100% 10.18% 100%
and provision of bad debt 5.53 5.53 445.53 53
reserve on individual basis
405,997,5 47,765,78 316,670 47,770,082.
Total -- -- -- --
12.43 3.68 ,850.75 38
Note to the categories of accounts receivable:
In CNY
Description of accounts receivable Book Balance Bad debt reserve Provision proportion Provision reason
Beijing Urban/Rural Trade Center Co., Ltd. 2,033,710.15 2,033,710.15 100% Unrecoverable
Qingdao Handry Timepieces, Glasses and
1,298,215.01 1,298,215.01 100% Unrecoverable
Jewelry Co.
Timepieces and Sewing Machine
Wholesale Station of Yingkou General 982,604.03 982,604.03 100% Unrecoverable
Merchandise Co.
Jilin Timepieces and Photographic
890,387.77 890,387.77 100% Unrecoverable
Paraphernalia Wholesale Co.
Siping No. 1 Department Store 823,302.04 823,302.04 100% Unrecoverable
Anshan Timepieces and Photographic
807,815.02 807,815.02 100% Unrecoverable
Equipment Co.
Others 4,152,284.47 4,152,284.47 100% Unrecoverable
Total 10,988,318.49 10,988,318.49 --
In the grouping, the accounts receivable for which the bad debt reserve is provided based on the age analysis
In CNY
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End of the reporting period Beginning of the reporting period
Book Balance Book Balance
Age
Proportion Bad debt reserve Proportion Bad debt reserve
Amount Amount
(%) (%)
Within 1 year
Including: -- -- -- -- -- --
Within 1 year 138,073,785.90 98.77% 4,380,273.79 98,585,730.49 98.94% 4,384,572.49
Sub-toal within 1
138,073,785.90 98.77% 4,380,273.79 98,585,730.49 98.94% 4,384,572.49
year
1 to 2 years 1,134,631.86 0.81% 68,327.94 722,581.43 0.73% 68,327.94
2 to 3 years 585,831.00 0.42% 99,417.93 331,393.09 0.33% 99,417.93
Over 3 years 0.00 0% 0.00
3 to 4 years
4 to 5 years
Over 5 years
Total 139,794,248.76 -- 4,548,019.66 99,639,705.01 -- 4,552,318.36
In the grouping, the account receivable for which reserve for bad debt is provided based on balance percentage:
Inapplicable
In the grouping, the accounts receivable for which the bad debt reserve is provided based on the other method:
Inapplicable
At the end of the reporting period, accounts receivable with insignificant single amount and provision of bad debt reserve
on individual basis:
In CNY
Description of accounts
Book Balance Bad debt reserve Provision proportion Provision reason
receivable
Doubtful accounts/bad
32,229,445.53 32,229,445.53 100% Unrecoverable
debt
Total 32,229,445.53 32,229,445.53 100% --
(2) Accounts receivable reversed or recovered in the reporting period
Inapplicable
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(3) Accounts receivable actually written-off in the reporting period
Inapplicable
(4) Accounts receivable from the shareholder holding over 5% (including 5%) of the Company’s
voting shares
Inapplicable
(5) Top five debtors of the accounts receivable
In CNY
Relationship with the Proportion in the total
Company Names Amount Year
Company accounts receivable (%)
Shanxi International
Non-Related Party 6,867,577.77 Within a year 1.69%
Trade Center Co., Ltd.
Shenzhen China
Resource Co., Ltd.
(Payment with credit Non-Related Party 5,716,897.23 Within a year 1.41%
card at Mixc Shop)
BILLION GENESIS Non-Related Party 5,585,214.99 Within a year 1.38%
Shenzhen Huizheng Non-Related Party
4,669,689.89 Within a year 1.15%
E-business Co., Ltd
Heilongjiang Jinan
Europe Plaza Non-Related Party 4,055,374.77 Within a year 1%
Development Co., Ltd.
Total -- 26,894,754.65 -- 6.62%
(6) Due from Related Parties
In CNY
Proportion in the total of the
Company names Relationship with the Company Amount
accounts receivable (%)
Accounts receivable:
under the control of the same
Rainbow Supermarket 2,229,771.46 0.55%
party
under the control of the same
AVIC 68,223.00 0.02%
party
Shennan Circuit under the control of the same 787,374.33 0.19%
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party
Zhonghang Electronic
Measuring Instruments Co., under the control of the same
40,748.00 0.01%
Ltd party
Xian Zhongfei Aviation Testing
under the control of the same
Technology Development Co., 2,000,000.00 0.49%
party
Ltd.
Other receivables:
Shenzhen CATIC Enterprise under the control of the same
189,600.00 0.05%
Group Training Center party
under the control of the same
CATIC Monitor 102,500.00 0.03%
party
Ganzhou CATIC Real Estate under the control of the same
122,665.60 0.03%
Co. party
under the control of the same
Rainbow Supermarket 113,401.60 0.03%
party
Total -- 5,654,283.99 1.39%
(7) Accounts receivable with termination recognition
Inapplicable
(8) In case of securitization on the asset of accounts receivable, the amounts of the assets and
liabilities continuing to be involved in the formation are stated.
Inapplicable
7. Other receivables
(1) Disclosure based on categories of other receivables
In CNY
End of the reporting period Beginning of the reporting period
Book Balance Bad debt reserve Book Balance Bad debt reserve
Categories
Proporti Proporti Proportion Proporti
Amount Amount Amount Amount
on (%) on (%) (%) on (%)
Other receivables with
significant single amount
2,215,684.0 2,215,684.0 2,215,684.0
and provision of bad debt 5.33% 100% 5.68% 2,215,684.09 100%
9 9 9
reserve on individual
basis
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Other receivables for which bad debt reserve has been provided based on the grouping
Grouping based on the 24,277,580. 1,241,275.5 23,076,732.
58.37% 5.11% 59.18% 1,241,275.52 5.38%
accounting age 97 2 01
Grouping of the 13,621,677. 12,223,537.
32.75% 0.00 0% 31.35% 0.00 0%
designated accounts 39 25
37,899,258. 1,241,275.5 35,300,269.
Sub-total of Groupings 91.11% 3.28% 90.52% 1,241,275.52 3.52%
36 2 26
Other receivables with
insignificant single
1,480,064.1 1,480,064.1 1,480,064.1
amount and provision of 3.56% 100% 3.8% 1,480,064.11 100%
1 1 1
bad debt reserve on
individual basis
41,595,006. 4,937,023.7 38,996,017.
Total -- -- -- 4,937,023.72 --
56 2 46
Other receivables with significant single amount and provision of bad debt reserve on individual basis at the end of the
reporting period
In CNY
Other receivables Book Balance Amount of bad debt Provision proportion Reasons
Shenzhen New Longtai
1,573,876.89 1,573,876.89 100% Unrecoverable
Industrial Co. Ltd.
Zhuangtu Commodities
641,807.20 641,807.20 100% Unrecoverable
Trading Center
Total 2,215,684.09 2,215,684.09 -- --
In the grouping, other receivables for which the bad debt reserve is provided based on the age analysis:
In CNY
End of the reporting period Beginning of the reporting period
Book balance Book balance
Age
Propo Propo
Bad debt reserve Bad debt reserve
Amount rtion Amount rtion
(%) (%)
Within a year
Including:
96.18
Within a year 23,305,749.06 96% 991,460.41 22,195,595.10 991,460.41
%
96.18
Subtotal within a year 23,305,749.06 96% 991,460.41 22,195,595.10 991,460.41
%
1 to 2 years 313,103.48 1.29% 31,686.41 388,136.58 1.68% 31,686.41
2 to 3 years 191,414.10 0.79% 8,862.70 33,542.33 0.15% 8,862.70
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Over 3 years 467,314.33 1.92% 209,266.00 459,458.00 1.99% 209,266.00
3 to 4 years
4 to 5 years
Over 5 years
Total 24,277,580.97 -- 1,241,275.52 23,076,732.01 -- 1,241,275.52
In the grouping, other account receivable for which bad debt reserve is provided based on balance percentage:
Inapplicable
In the grouping, other receivable for which the bad debt reserve is provided based on other method:
Inapplicable
Other receivables with insignificant single amount and provision of bad debt reserve on individual basis at the end of the
reporting period
In CNY
Other receivables Book Balance Bad debt reserve Provision proportion Provision reason
Rent 814,950.63 814,950.63 100% Unrecoverable
Borrowings 400,000.00 400,000.00 100% Unrecoverable
Reserve for
individuals of service 156,020.47 156,020.47 100% Unrecoverable
termination
Consideration of
equity assignment 109,093.01 109,093.01 100% Unrecoverable
Total 1,480,064.11 1,480,064.11 100% --
(2) Other receivables reversed or recovered in the reporting period
Inapplicable
(3) Other receivables actually written-off in the reporting period
Inapplicable
(4) Other receivables from the shareholder holding over 5% (including 5%) of the Company’s
voting shares in the reporting period
Inapplicable
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(5)Nature or description of the other receivables with bigger amount
Inapplicable
(6) Top Five Debtors of the Other Receivables
In CNY
Relationship with the Proportion in the total of
Company names Amount Years
Company the other receivables (%)
China Tenth Metallurgy
Group Limited Non-Related Party 3,379,779.96 Within 1 year 8.13%
Corporation
Subsidy tax in
Non-Related Party 1,611,525.86 Within 1 year 3.87%
Switzerland
Shenzhen New Longtai
Non-Related Party 1,573,876.89 Over 3 years 3.78%
Industrial Co. Ltd.
Shenzhen China
Resource Co., Ltd.
Non-Related Party 1,491,570.00 Within 1 year 3.59%
(Payment with credit card
at Mixc Shop)
Shenzhen Yitian Holiday
World Real Estate Non-Related Party 1,090,523.00 Within 1 year 2.62%
Development Co., Ltd.
Total -- 9,147,275.71 -- 21.99%
(7) Other receivables from related parties
In CNY
Proportion in the total of the other
Company names Relationship with the Company Amount
receivables (%)
Shenzhen CATIC Enterprise
Common controller 189,600.00 0.46%
Group Training Center
CATIC Monitor Common controller 102,500.00 0.25%
Ganzhou CATIC Real Estate
Common controller 122,665.60 0.3%
Co.
Rainbow Supermarket Common controller 113,401.60 0.26%
Total -- 528,167.20 1.27%
(8) Other receivable terminated for recognition
Inapplicable
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(9) In case of securitization on the asset of other receivables, the amounts of the assets and
liabilities continuing to be involved in the formation are stated.
Inapplicable
8. Advance Payment
(1) Advance payment presented based on age
In CNY
End of the reporting period Beginning of the reporting period
Age Proportion Proportion
Amount Amount
(%) (%)
Within 1 year 42,115,402.24 99.89% 75,698,876.97 98.13%
1 to 2 years 13,135.00 0.03% 1,105,861.04 1.43%
2 to 3 years 32,160.00 0.08% 154,972.00 0.2%
Over 3 years 0% 180,000.00 0.24%
Total 42,160,697.24 -- 77,139,710.01 --
(2) Top Five Receivers of Advance Payment
In CNY
Relationship with the
Company names Amount Time Reason of unsettlement
Company
SAN SUN INDUSTRIAL
Non-Related Party 6,504,847.83 Undue
CO., LTD.
Dongguan Junyi
Precision Hardware Non-Related Party 1,792,599.00 Undue
Products Co., Ltd.
Shenzhen
Intercontinental Building
Non-Related Party 843,053.33 Undue
Decoration Group Co.,
Ltd.
MICHAVD SA Non-Related Party 831,710.28 Undue
Shenzhen Yiqin
Non-Related Party 820,638.00 Undue
Metalwares Co., Ltd.
Total -- 10,792,848.44 -- --
(3) Advance payment to the shareholder holding over 5% (including 5%) of the Company’s voting shares
Inapplicable
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(4) Note to the advance payment
End of the reporting period Year beginning
Amount in Amount in
Items Exchange Conversion in Exchange Conversion in
foreign foreign
rate CNY rate CNY
currency currency
HKD 9,104,661.60 0.8152 7,422,120.14 0.8107 3,634,256.78
4,482,862.69
CHF - - - 3,664.90 6.7085 24,585.98
9. Inventories
(1) Classification of Inventories
In CNY
End of the reporting period Beginning of the reporting period
Items Provision for Provision for
Book Balance Book value Book Balance Book value
price falling price falling
Raw materials 131,720,382.24 22,595,495.27 109,124,886.97 158,461,195.42 22,595,495.27 135,865,700.15
Products in process 13,687,511.83 0.00 13,687,511.83 24,453,989.02 24,453,989.02
Commodities in 1,676,051,143.1 1,495,548,483.3 1,480,584,794.4
1,691,014,832.03 14,963,688.88 14,963,688.88
stock 5 5 7
Circulating materials
Productive biological
asset
1,798,863,541.9 1,678,463,667.7 1,640,904,483.6
Total 1,836,422,726.10 37,559,184.15 37,559,184.15
5 9 4
(2) Inventory falling price reserves
In CNY
Amount Decrease in the reporting period
Opening book Ending book
Categories provided in the
balance Reversal Write-off balance
reporting period
Raw materials 22,595,495.27 0.00 0.00 0.00 22,595,495.27
Products in
0.00 0.00 0.00 0.00
process
Commodities in
14,963,688.88 14,963,688.88
stock
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Circulating
materials
Productive
biological asset
Total 37,559,184.15 0.00 0.00 0.00 37,559,184.15
(3) About inventory falling price reserves
The balance of the Groups famous brand watches in stock with age exceeding three years at the end of the reporting
period was CNY 101,990,536.21, taking 7.02% of the balance of the famous brand watches at the end of the reporting
period; the balance of the Groups famous brand watches in stock with age exceeding three years at year beginning was
CNY 107,299,115.91, taking 8.15% of the balance of the famous brand watches at year beginning.
10. Other current assets
In CNY
Items End of the reporting period Beginning of the reporting period
Input VAT to be offset (Note) 29,210,979.09 39,840,898.57
Rent 7,549,851.09 3,932,802.45
Others 2,364,238.22 472,195.15
Total 39,125,068.40 44,245,896.17
Note to other current liabilities:
The Groups input VAT from procurements not yet offset in the reporting period.
11. Available-for-sale financial assets
(1) About available-for-sale financial assets
In CNY
Fair value at the end of the Fair value at the beginning of
Items
period the period
Available-for-sale bonds
Available-for-sale equity instrument
Others
Total 0.00 0.00
In case the held-to-maturity investment is reclassified into available-for-sale financial asets, the amount involved in the
reclassification in the reporting period was CNY 0.00. This amount took 0% of the total amount of the held-to-maturity
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investment before the reclassification.
(2) Long-Term Credit Investment in the available-for-sale financial asets
In CNY
Accrued
Initial Interest in
Type of Maturity Opening receivable Ending
Bonds Par value investment the reporting
bonds time balance or received balance
cost period
interest
Total -- -- 0.00 -- 0.00 0.00 0.00 0.00
12. Held-to-maturity investments
(1) About the held-to-maturity investments
In CNY
Items Ending book balance Opening book balance
Total 0.00 0.00
(2) The undue held- to-maturity investment sold in the reporting period
In CNY
Proportion taken in the amount of the
Items Amount
investment before sale (%)
Total 0.00 --
13. Long term accounts receivable
In CNY
Categories End of the reporting period Beginning of the reporting period
Financing lease
Including: unrealized financing income
Goods sold with payment by installment
Labor service provided with payment by
installment
Others
Total 0.00 0.00
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14. Investment in joint ventures and associates
In CNY
Voting
Propor propor Total Total Total Total
tion of tion in assets liabiliti net operati
Net
the the at es at assets on
Place Legal profit
Enterp Busine Regist shares invest the the at the incom
Invest of repres Curren in the
rise ss ered held ee end of end of end of e in
ees Regist entativ cy reporti
type type Capital by the taken the the the the
ration e ng
Comp by the reporti reporti reporti reporti
period
any Comp ng ng ng ng
(%) any period period period period
(%)
I. Joint Venture
II. Associates
Produ
ction
and
sales
of
watch
es,
watch
driving
units,
Shang parts,
hai sophis
Dong 15,350 74,500 70,079 23,039
Watch Enterp Shang ticated 4,420, 765,49
Guozh ,000.0 CNY 25% 25% ,154.6 ,967.5 ,053.5
Industr rises hai instru 187.14 5.42
ang 0 5 1 8
y Co., ments
Ltd., and
access
ories
Import
&
export
of
goods
and
techno
logy
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import
&
export
15. Long-term equity investment
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(1) Statement of Long Term Equity Investment
In CNY
Note to the
inconsistence
between the
Shareholding Shareholding
proportion of Reserve for
Initial proportion in proportion in Cash dividend
Accounting Opening Increase/Decr Ending the shares in Reserve for impairment
Investees investment the investee the investees in the reporting
method balance ease balance the investees impairment provided in the
cost (%) vote-bearing period
held by the period
shares (%)
Company and
the voting
power
Equity
Northwestern
distribution
Polytechnical
based on 50%
University
Cost method 1,350,000.00 1,863,572.76 -300,000.00 1,563,572.76 45% 50% according to 0.00 0.00
Shenzhen
the agreement
Research
of
Institute (Note)
shareholders
Xian
Tangcheng Cost method 85,000.00 85,000.00 85,000.00 0.1% 0.1% 0.00 0.00
Co., Ltd.
Shenzhen
CATIC Culture
Cost method 300,000.00 300,000.00 300,000.00 15% 15% 300,000.00 0.00 0.00
Communicatio
n Co., Ltd.
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Shanghai
Property Co., Equity method 40,300,250.00 0.00 40,491,623.86 40,491,623.86 25% 25% 0.00 0.00
Ltd.
Total -- 42,035,250.00 2,248,572.76 40,191,623.86 42,440,196.62 -- -- -- 300,000.00 0.00 0.00
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(2) About the ability of transferring fund to the investing company being restricted
In CNY
Long term equity investment project with the
Accumulative amount of unrecognized
ability of transferring fund to the investing Cause of being restricted
investment loss in the reporting period
company being restricted
Inapplicable
Note to the long term equity investment:
On december 31, 2011, the Company and Northwestern Polytechnical University, another shareholder of Northwestern
Polytechnical University Shenzhen Research Institute concluded the Agreement on Assignment of the Equity of
Northwestern Polytechnical University Shenzhen Research Institute, according to which the Company would assign its
45% in Shenzhen Northwestern Industrial Technology Research Insitute Co., Ltd. with consideration of CNY 1,650,000.00.
Ended June 30, 2012, the assignment was still in process. In the reporting period, the Company no longer took it into
account in accounting according to the equity method.
16. Investment Based Real Estate
(1) Investment based real estate measured based on costs
In CNY
Increase in the reporting Decrease in the
Items Opening book balance Ending book balance
period reporting period
I. Total original book
358,996,492.57 0.00 0.00 358,996,492.57
value
1. Housing and
358,996,492.57 0.00 0.00 358,996,492.57
buildings
2. Land use right
II. Total accumulative
depreciation and
86,505,843.94 4,826,979.86 0.00 91,332,823.80
accumulative
amortization
1. Housing and
86,505,843.94 4,826,979.86 0.00 91,332,823.80
buildings
2. Land use right
III. Total net book
value of investment 272,490,648.63 0.00 4,826,979.86 267,663,668.77
based real estate
1. Housing and
272,490,648.63 4,826,979.86 267,663,668.77
buildings
2. Land use right
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IV. Total accumulative
amount of provision for
impairment of 0.00 0.00 0.00 0.00
investment based real
estate
1. Housing and
buildings
2. Land use right
V. Total book value of
investment based real 272,490,648.63 0.00 4,826,979.86 267,663,668.77
estate
1. Housing and
272,490,648.63 4,826,979.86 267,663,668.77
buildings
2. Land use right
In CNY
Reporting Period
Amount of depreciation and amortization in the reporting period: 4,826,979.26
Amount of reserve for impairment of the investment based real estate
0.00
provided in the reporting period
(2) Investment based real estate measured based on fair value
Inapplicable
17. Fixed assets
(1) About Fixed assets
In CNY
Opening book Decrease in the Ending book
Items Increase in the reporting period
balance reporting period balance
I. Total original book value 377,728,540.00 6,276,007.08 1,611,765.98 382,392,781.10
Incl.: Housing & buildings 271,804,200.65 0.00 1,008,888.18 270,795,312.47
Machines & equipment 38,237,004.00 1,696,508.58 156,022.89 39,777,489.69
Motor vehicles 12,681,827.76 1,780,170.81 150,709.00 14,311,289.57
Electronic equipment 23,560,299.91 1,428,998.80 292,605.74 24,696,692.97
Other equipment 31,445,207.68 1,370,328.89 3,540.17 32,811,996.40
Opening book Newly increased Provision in the Decrease in the Ending balance of
--
balance in the reporting reporting period reporting period the reporting
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period period
II. Total accumulative
82,321,255.69 0.00 11,328,034.83 218,517.67 93,430,772.85
depreciation
Incl.: Housing & buildings 24,039,045.27 4,113,390.51 51,707.03 28,100,728.75
Machines & equipment 13,453,519.47 1,288,390.03 0.00 14,741,909.50
Motor vehicles 7,163,194.71 1,165,234.07 160,502.69 8,167,926.09
Electronic equipment 14,399,114.06 1,143,770.46 6,026.23 15,536,858.29
Other equipment 23,266,382.18 3,617,249.76 281.72 26,883,350.22
Ending balance of
Opening book
-- -- the reporting
balance
period
III. Total net book value of
295,407,284.31 -- 288,962,008.25
fixed assets
Incl.: Housing & buildings 247,765,155.38 -- 242,694,583.72
Machines & equipment 24,783,484.53 -- 25,035,580.19
Motor vehicles 5,518,633.05 -- 6,143,363.48
Electronic equipment 9,161,185.85 -- 9,159,834.68
Other equipment 8,178,825.50 -- 5,928,646.18
IV. Total reserve for
0.00 -- 0.00
impairment
Incl.: Housing & buildings --
Machines & equipment --
Motor vehicles --
Electronic equipment --
Other equipment --
III. Total book value of fixed
295,407,284.31 -- 288,962,008.25
assets
Incl.: Housing & buildings 245,279,708.75 -- 242,694,583.72
Machines & equipment 27,663,805.34 -- 25,035,580.19
Motor vehicles 2,940,305.45 -- 6,143,363.48
Electronic equipment 10,485,220.77 -- 9,159,834.68
Other equipment 9,038,244.00 -- 5,928,646.18
The depreciation amount in the reporting period was CNY11,328,034.83; the cost of the fixed assets transferred in from
the construction-in-process amounted to CNY 0.00.
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(2) About temporarily idle fixed assets
In CNY
Accumulative
Items Original book value Impairment reserve Net book value Remarks
depreciation
Housing and
0.00
buildings
Machines &
0.00
equipment
Motor vehicles 0.00
(3) Fixed assets rented through financing lease
Inapplicable
(4) Fixed assets leased through operating lease
Inapplicable
(5) About the fixed assets for sale held at the end of the reporting period
Inapplicable
(6) Fixed asset whose property title certificate has not been issued
Inapplicable
Note to fixed assets:
Ended June 30, 2012, the housing and buildings with the original book value amounting to CNY 3,307,253.08 and net
value amounting to CNY 3,188,254.23 were the collateral for the Groups long term loan amounting to CNY 1,128,323.79.
At the end of the reporting period, the original value of the fixed assets with depreciation sufficiently provided but still in
use was CNY 25,645,089.80.
18. Construction-in-process
（1）
In CNY
End of the reporting period Beginning of the reporting period
Items Impairment Impairment
Book Balance Book value Book Balance Book value
reserve reserve
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Project of the ground parking
lot of FIYTA Technology 319,364.00 319,364.00 249,000.00 249,000.00
Building
Project of watch production
910,500.00 910,500.00
base at Guangming New Zone
17-storey Data Center project 154,743.62 154,743.62
20th floor refurbishment project
1,090,000.00 1,090,000.00
of FIYTA Technology Building
West are of the 19th floor
refurbishment project of FIYTA 109,197.95 109,197.95
Technology Building
Total 2,583,805.57 0.00 2,583,805.57 249,000.00 0.00 249,000.00
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(2) Change of key construction-in-process project
In CNY
Including:
Proportion of Accumulative amount of Interest
Beginning of Increase in Transferred the project amount the capitalization End of the
Other Project
Project Budget the reporting the reporting into fixed investment in involved in capitalized rate in the Fund source reporting
decreases progress
period period assets the budget interest interest in the reporting period
(%) capitalization reporting period (%)
period
Total 0.00 0.00 0.00 0.00 0.00 -- -- 0.00 0.00 -- -- 0.00
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(3) Impairment reserve for the construction- in-process
In CNY
Beginning of the Increase in the Decrease in the End of the Reason of
Project
reporting period reporting period reporting period reporting period provision
Total 0.00 0.00 0.00 0.00 --
(4) Work progress of the key construction-in-process
Inapplicable
(5) Note to the construction-in-process
19. Engineering Supplies
In CNY
Beginning of the Increase in the Decrease in the End of the reporting
Project
reporting period reporting period reporting period period
Total 0.00 0.00 0.00 0.00
20. Disposal of fixed assets
In CNY
Book value at the
Book value at the end of the Cause of being transferred into
Project beginning of the reporting
period disposal
period
Total 0.00 0.00 --
21, Productive biological asset
(1) Measured based on cost
Inapplicable
(2) Measured based on fair value
Inapplicable
22. Oil and gas assets
Inapplicable
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23. Intangible Assets
(1) About intangible assets
In CNY
Increase in the reporting Decrease in the reporting
Project Opening book balance Ending book balance
period period
I. Total original book value 47,741,656.95 353,205.14 0.00 48,094,862.09
Land use right 34,280,949.60 0.00 34,280,949.60
Software system 3,095,885.83 353,205.14 3,449,090.97
Trademark use right 10,364,821.52 0.00 0.00 10,364,821.52
II. Total accumulative
10,675,829.46 668,682.58 0.00 11,344,512.04
amortized amount
Land use right 5,505,188.48 359,973.18 5,865,161.66
Software system 1,281,171.09 303,049.42 1,584,220.51
Trademark use right 3,889,469.89 5,659.98 0.00 3,895,129.87
III. Total net book value of
37,065,827.49 0.00 0.00 36,750,350.05
intangible assets
Land use right 28,775,761.12 28,415,787.94
Software system 1,814,714.74 1,864,870.46
Trademark use right 6,475,351.63 6,469,691.65
IV. Total reserve for
0.00 0.00 0.00 0.00
impairment
Land use right
Software system
Trademark use right
Total book value of
37,065,827.49 0.00 0.00 36,750,350.05
intangible assets
Land use right 28,775,761.12 28,415,787.94
Software system 1,814,714.74 1,864,870.46
Trademark use right 6,475,351.63 6,469,691.65
The amount amortized in the reporting period was CNY 668,682.58.
(2) Expenses for the Company’s development projects
In CNY
Project Beginning of the Increase in the Decrease in the reporting period End of the reporting
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reporting period reporting period Counted to the period
Recognized as
current gains and
intangible assets
losses
Total 0.00 0.00 0.00 0.00 0.00
(3) Intangible asset whose property title certificate has not been issued
Inapplicable
24. Goodwill
In CNY
impairment
reserve at the
Investees name or matter Increase in the Decrease in the
Opening balance Ending balance end of the
resulting in goodwill reporting period reporting period
reporting
period
Lishan Department Store 1,735,756.48 0.00 0.00 1,735,756.48 1,735,756.48
Total 1,735,756.48 0.00 0.00 1,735,756.48 1,735,756.48
Impairment test and provision of impairment reserve of goodwill:
HARMONY, one of the Companys subsidiaries acquired 100% equity in Lishan Department Store on March 31, 2008 with
valuable consideration of CNY 1,200,000.00 and the fair value of the recognizable net assets of Lishan Department Store
on the acquisition day was CNY 535,756.48. HARMONY presented the margin amounting to CNY 1,735,756.48 in the
consolidated financial statements as “goodwill”. At the end of 2008, HARMONY made impairment test of the goodwill and
charged the loss from impairment of the goodwill lower than the recoverable amount totaling CNY 1,735,756.48 to the
gain and loss of the year 2008.
25. Long-term expenses to be apportioned
In CNY
Amount Amount at the
Amount at Increase in Reasons of
amortized in Other end of the
Items year the reporting other
the reporting decrease reporting
beginning period decreases
period period
Cost for
making 28,804,993.7 15,193,246.6 14,013,050.9 29,985,189.4
special 9 0 7 2
counters
Refurbishmen 79,481,713.4 22,374,600.6 90,426,445.6
11,429,868.47
t 2 8 3
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Endorsement 13,538,547.4 10,281,554.5
127,644.00 3,384,636.90
fee 8 8
Others 840,058.48 228,500.00 311,681.61 756,876.87
122,665,313. 37,923,991.2 29,139,237.9 131,450,066.
Total 0.00 --
17 8 5 50
26. Deferred Income Tax Asset and Deferred Income Tax Liability
(1) The deferred income tax asset/deferred income tax liability is not presented with the net
amount after offsetting.
Deferred Income Tax Asset/Deferred Income Tax Liability Already Recognized
In CNY
Items End of the Reporting Period Beginning of the reporting period
Deferred income tax asset:
Reserve for impairment of the assets 6,526,517.63 6,526,517.64
Organization expenses
Offsetable loss 3,817,478.11 4,518,836.87
Unrealized profit offset internally 40,655,198.43 31,842,591.98
Deferred income 516,500.00 287,500.00
Others 0.00 3,075,469.94
Sub-total 51,515,694.17 46,250,916.43
Deferred income tax liabilities:
Valuation of transactional financial instrument and
derivative financial instrument
Change of the fair value of the available-for-sale
financial assets charged to the capital reserve
Long-term equity investment 128,393.19 128,393.19
Sub-total 128,393.19 128,393.19
Statement of unrecognized deferred income tax asset
In CNY
Items End of the Reporting Period Beginning of the reporting period
Offsetable provisional discrepancy 63,830,117.70 63,830,117.70
Offsetable loss 0.00 0.00
Total 63,830,117.70 63,830,117.70
The offsetable loss of the unrecognized deferred income tax shall be due in the following years:
In CNY
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End of the Reporting Beginning of the
Year Remark
Period reporting period
Total 0 0 --
Statement of taxable differences and offsetable differences
In CNY
Provisional discrepancy amount
Items Beginning of the reporting
End of the reporting period
period
Taxable difference items
Sub-total
Offsetable difference items
Reserve for impairment of assets 29,671,929.03 29,671,929.03
To offset the internal unrealized profit 163,961,823.04 128,427,656.86
Deferred income 2,066,000.00 1,150,000.00
Offsetable loss 16,614,260.61 19,311,171.71
Others 12,301,879.74
Sub-total 212,314,012.68 190,862,637.34
(2) Presentation of the net amount of the deferred income tax asset and deferred income tax
liability after offsetting
Inapplicable
27. Statement of reserve for impairment of assets
In CNY
Opening book Increase in the Decrease in the reporting period Ending book
Items
balance reporting period Reversal Write-off balance
I. Provision for bad debts 52,707,106.10 0.00 4,298.70 52,702,807.40
II. Provisions for price falling of
37,559,184.15 0.00 0.00 0.00 37,559,184.15
inventories
III. Provision for impairment of
financial assets available for sale
IV. Provision for impairment of
held-to-due investment
V. Provision for impairment of
300,000.00 0.00 300,000.00
long-term equity investments
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VI. Provision for impairment of
0.00 0.00 0.00
investment based real estate
VII. Provision for impairment of
0.00 0.00
fixed assets
VIII. Provision for impairment of
engineering supplies
IX. Provision for impairment of
0.00 0.00 0.00
construction-in-progress
X. Provision for impairmentof
productive biological asset
Including: Provision for
impairment of ripe productive
biological asset
XI. Provision for impairment of oil
0.00 0.00 0.00
and gas asset
XII. Provision for impairment of
0.00 0.00 0.00
intangible assets
XIII. Provision for impairment of
1,735,756.48 1,735,756.48
goodwill
XIV. Others
Total 92,302,046.73 0.00 4,298.70 0.00 92,297,748.03
28. Other non-current assets
In CNY
Items End of the reporting period Beginning of the reporting period
Payment for equity acquisition
0.00 40,300,250.00
Total 0.00 40,300,250.00
Note to other current assets:
The amount at the beginning of the reporting period was the advance payment to Beijing Equity Exchange Co., Ltd. for
acquisition of 25% in Shanghai Watch Industry Co., Ltd. from Shenzhen CATIC Investment Management Co., Ltd.
29. Short-term Borrowings
(1) Classification of Short-term Borrowings
In CNY
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Items End of the Reporting Period Beginning of the reporting period
Collateral Borrowings
Pledged borrowings
Secured borrowings 1,055,000,000.00 1,029,107,000.00
Credit borrowings 320,000,000.00 70,000,000.00
Total 1,375,000,000.00 1,099,107,000.00
Note to classification of the short-term borrowings
For the secured borrowings, CATIC Shenzhen offered guarantee to the Company.
(2) Short term borrowings already due but remaining outstanding
In CNY
Application of the Reason of failure Predicted repayment
Loan supplier Total loan Loan interest
loan to repay in time time
Total 0.00 -- -- -- --
30. Trading financial liabilities
In CNY
Fair value at the end of the Fair value at the beginning of the
Items
reporting period reporting period
Issued transaction bonds
Financial liabilities designated to be
measured based on the fair value and its
movement was counted to the current gain
and loss
Derivative financial liabilities
Other financial liabilities
Total 0.00 0.00
31. Notes Payable
In CNY
Categories End of the Reporting Period Beginning of the reporting period
Trade acceptance 0.00 0.00
Bank acceptance 125,000,000.00 0.00
Total 125,000,000.00 0.00
The amount to be due in the next accounting period was CNY 125,000,000.00.
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32. Accounts payable
(1)
In CNY
Items End of the reporting period Beginning of the reporting period
Trade accounts payable 134,903,542.64 167,271,669.39
Payables for materials 50,814,465.60 23,977,932.47
Engineering warranty fee payable 211,339.76 211,339.76
Total 185,929,348.00 191,460,941.62
(2) Accounts payable to the shareholder holding over 5% (including 5%) of the Company’s voting
shares in the reporting period
Inapplicable
33. Advance Receipts
(1)
In CNY
Items End of the reporting period Beginning of the reporting period
Payment for goods 9,999,570.06 3,740,327.89
Total 9,999,570.06 3,740,327.89
(2) Advance receipts from the shareholder holding over 5% (including 5%) of the Company’s
voting shares in the reporting period
Inapplicable
34. Salaries payable to employees
In CNY
Opening book Increase in the Decrease in the Ending book
Items
balance reporting period reporting period balance
I. Salaries, bonus, allowances, subsidies 27,142,733.95 139,710,121.43 153,087,466.79 13,765,388.59
II. Staffs welfare 4,370,853.76 4,370,853.76
III. Social security 0.00 17,220,587.49 16,920,587.49 300,000.00
Including: 1. medical insurance premium 4,556,387.16 4,556,387.16
2. Basic endowment insurance 10,762,113.95 10,762,113.95
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premium
3. Contribution to the annuity scheme 300,000.00 0.00 300,000.00
4. Unemployment insurance
862,204.34 862,204.34
premium
5. Service injury insurance premium 331,735.66 331,735.66
6. Maturity insurance premium 392,434.66 392,434.66
7. Others 15,711.72 15,711.72
IV. Public reserve for housing 5,128,099.01 5,128,099.01
V. Dismissal welfare 10,800.00 10,800.00
VI. Others 271,735.62 3,802,783.71 3,837,913.63 236,605.70
1. Operating fund for trade union and the
operating fund for the education of 263,774.55 3,623,265.90 3,650,434.75 236,605.70
employees
2. Others 7,961.07 179,517.81 187,478.88
Total 27,414,469.57 170,243,245.40 183,355,720.68 14,301,994.29
Of the employees salaries payable, the amount of the arrears was CNY 0.00.
The amount of the trade union and employees education budget was CNY 236,605.70, the amount of the non-monetary
welfare was CNY 0.00 and the compensation given due to discharge of the labor relations was CNY 10,800.00.
Predicted pay time, amount, etc. of the staffs salaries payable:
The Group predicted that the staffs salaries payable not provided at year end shall be distributed in the next fiscal year.
35. Payable Taxes
In CNY
Beginning of the reporting
Items End of the reporting period
period
Value-added tax 24,045,606.36 17,516,474.89
Consumption tax 31,742.77 135,853.85
Business tax 518,367.84 636,906.77
Enterprise income tax 17,920,826.85 0.00
Individual income tax 3,740,976.27 30,759,501.94
Urban maintenance and construction tax 285,391.81 115,058.86
Real estate tax 40,090.99 38,590.99
Education Surcharge 112,727.95 5,051.25
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Stamp duty 19,516.98 697,523.92
Dyke protection surcharge 30,305.67 28,377.06
Others 156,153.25 365,133.29
Total 46,901,706.74 50,298,472.82
36. Interest payable
In CNY
Beginning of the
Items End of the reporting period
reporting period
Long term loan interest with interest payment in installment
and principal repayment upon maturity
Interest of corporate bond
Interest payable for short term loan 2,712,814.61 14,038,573.07
Total 2,712,814.61 14,038,573.07
37. Dividend payable
In CNY
End of the reporting Beginning of the Reason of being overdue for 1
Company names
period reporting period year
Total 0.00 0.00 --
38. Other payables
(1)
In CNY 元
Beginning of the reporting
Items End of the reporting period
period
Within 1 year 23,309,458.74 21,029,045.90
1 to 2 years 1,085,360.15 3,066,028.22
2 to 3 years 772,389.79 1,544,025.24
Over 3 years 8,054,952.91 7,361,735.17
Total 33,222,161.59 33,000,834.53
(2) Of the other payables, the amount due to the shareholder holding over 5% (including 5%) of
the Company’s voting shares in the reporting period
Inapplicable
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(3) Note to other payables with big amount with age exceeding 1 year
Reason of remaining Are they to be paid after the
Creditors Amount
outstanding balance sheet day?
Shenzhen Tencent Computer
2,600,000.00 Still in the lease term No
System Co., Ltd.
Zhu Jin 500,000.00 Deposit for food coupon No
Shenzhen YouLiFeng
Self-help Kara OK Recreation 432,429.00 Still in the lease term No
Supermarket Co., Ltd.
Shenzhen CATIC Real Estate
Co., Ltd.
424,800.00 Still in the lease term No
(CATIC Real Estate)
China Merchants Bank Co.,
Ltd. Shenzhen Hi-tech Park 349,692.00 Still in the lease term No
Sub-branch
Weisheng Electronics
337,105.20 Still in the lease term No
(Shenzhen) Co., Ltd.
Shenzhen Pasta Wang
329,000.00 Still in the lease term No
Catering Chain Shop Co., Ltd.
Shenzhen Yongantang Chain-
301,644.00 Still in the lease term No
Pharmacy Co., Ltd.
Shenzhen GoodFamily Sports
279,578.00 Still in the lease term No
Goods Chain Shop Co., Ltd.
Oracle Research &
Development Center 238,140.00 Still in the lease term No
(Shenzhen) Co., Ltd.
Shenzhen Honestar
218,280.00 Still in the lease term No
Electronics Co., Ltd.
Shenzhen Orient Boiler
213,778.40 Still in the lease term No
Control Co., Ltd.
Total 6,224,446.60 Still in the lease term No
(4) Description of other payables with bigger amount
Creditors End of the reporting period Description
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Shenzhen Tencent Computer System Co., Ltd. 2,600,000.00 Rent deposit
Consideration for equity
Shenzhen Research Institute of Northwest China
1,350,000.00 assignment
Polytechnic University
Bravo Tech Inc. 586,638.96 Rent deposit
ZHU Jin 500,000.00 Deposit for food coupon
Shenzhen YouLiFeng Self-help Kara OK
432,429.00 Rent deposit
Recreation Supermarket Co., Ltd.
CATIC Real Estate 424,800.00 Rent deposit
Shenzhen GoodFamily Sports Goods Chain Shop
414,630.00 Rent deposit
Co., Ltd.
Money award payable from the
Money award from 11th China Patent Awards 350,000.00
patent awards
China Merchants Bank Co., Ltd. Shenzhen Hi-tech
349,692.00 Rent deposit
Park Sub-branch
Total 7,491,155.66
39. Predicted liabilities
In CNY
Beginning of the Increase in the reporting Decrease in the End of the Reporting
Items
reporting period period reporting period Period
External guarantee
Unsettled litigation case
Product quality assurance
Restructuring obligation
Dismissal welfare
Loss contract to be
implemented
Others
Total 0.00 0.00 0.00 0.00
40. Non-current liabilities due within a year
（1）
In CNY
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Beginning of the reporting
Items End of the Reporting Period
period
Long-term borrowings due within 1 year 49,900,000.00 149,600,000.00
Bonds payable due within 1 year
Long term account payable due within 1 year
Total 49,900,000.00 149,600,000.00
(2) Long-term loan due within one year
Long-term loan due within one year
In CNY
Beginning of the reporting
Items End of the Reporting Period
period
Collateral Borrowings
Pledged borrowings
Secured borrowings 49,900,000.00 149,600,000.00
Credit borrowings
Total 49,900,000.00 149,600,000.00
Of the long term borrowings due within a year, amount of the overdue borrowings approved for postponing was CNY0.00.
Top five creditors of the long term borrowings due within 1 year
In CNY
Beginning of the reporting
End of the Reporting Period
period
Loan Loan Loan expiry Interest rate
Currency Amount in Amount in Amount in Amount in
supplier starting date date (%)
foreign function foreign function
currency currency currency currency
China
Construction
Bank Co., January 21, January 20, 60,000,000.
CNY 4.05%
Ltd. 2010 2012 00
Shenzhen
Branch
Guangdong
December December 49,900,000. 50,000,000.
Developmen CNY 4.86%
1, 2009 1, 2012 00 00
t Bank
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Shenzhen
Donghai
Sub-branch
Sales
Department
of Ningbo July 15, June 28, 19,800,000.
CNY 4.9875%
Bank 2009 2012 00
Shenzhen
Branch
Sales
Department
of Ningbo September June 28, 19,800,000.
CNY 4.9875%
Bank 3, 2009 2012 00
Shenzhen
Branch
49,900,000. 149,600,000
Total -- -- -- -- -- --
00 .00
Overdue borrowing of the long term borrowings due within 1 year:
In CNY
Amount in Annual interest Application of the Reason of failure Predicted
Loan supplier Overdue time
borrowings rate (%) loan to repay in time repayment time
Total 0.00 -- -- -- -- --
Amount already repaid after the balance sheet day was CNY0.00.
(3) Bonds payable due within 1 year
Inapplicable
(4) Long term accounts payable due within 1 year
Inapplicable
41. Other current liabilities
In CNY
Items Ending book balance Opening book balance
Accrued expenses 5,881,030.87 4,814,572.85
Total 5,881,030.87 4,814,572.85
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42.Long term borrowings
(1) Classification of Long term Borrowings
In CNY
Items End of the Reporting Period Beginning of the reporting period
Collateral Borrowings
Pledged borrowings 1,128,323.79 1,197,658.09
Secured borrowings 106,008,389.00 205,432,909.00
Credit borrowings
Less: Long-term borrowings due within 1
-49,900,000.00 -149,600,000.00
year
Total 57,236,712.79 57,030,567.09
Note to classification of the long-term borrowings:
where, CNY 57,236,712.79 was guaranteed by FIYTA Hong Kong, one of the subsidiaries of the Company;CNY
49,900,000.00 was guaranteed by CATIC Shenzhen for the Company.
(2)Top Five Lenders of the Long Term Borrowings
In CNY
Beginning of the reporting
End of the Reporting Period
period
Loan Loan Loan expiry Interest rate
Currency Amount in Amount in Amount in Amount in
suppliers starting date date (%)
foreign function foreign function
currency currency currency currency
China
Construction
August 18, August 18, 34,435,000. 28,054,194. 34,435,000. 27,916,454.
Bank (Asia) HKD 3%
2011 2013 00 50 00 50
Corporation
Limited
China
Construction
September September 34,435,000. 28,054,194. 34,435,000. 27,916,454.
Bank (Asia) HKD 3%
23, 2011 23, 2013 00 50 00 50
Corporation
Limited
China
Construction November November 1,384,956.1 1,128,323.7 1,477,313.5 1,197,658.0
HKD 4.25%
Bank (Asia) 30, 2011 30, 2017 7 9 4 9
Corporation
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Limited
57,236,712. 57,030,567.
Total -- -- -- -- -- --
79 09
43. Bonds payable
Inapplicable
44. Long term accounts payable
Inapplicable
45. Special accounts payable
In CNY
Decrease in
Beginning of Increase in End of the
the
Items the reporting the reporting reporting Remarks
reporting
period period period
period
Total 0.00 0.00 0.00 0.00 --
Note to special accounts payable:
46. Other non-current liabilities
In CNY
Items Ending book balance Opening book balance
Deferred income 3,286,000.00 2,350,000.00
Total 3,286,000.00 2,350,000.00
Note to the other non-current liabilities: including various asset related and income related government subsidies and the
amount at the end of the reporting period acquired in the reporting period:
Statement of the deferred income:
Items End of the reporting period Year beginning
Fund financed for construction of enterprise technology 1,200,000.00 1,200,000.00
center (Note ①)
Budget for the provincial and ministrial IUR 136,000.00 100,000.00
cooperation commissioner project(Note②)
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Fund for supporting implementation of standardization 300,000.00 -
strategy (Note③)
Money award from patent awards (note ④) 1,650,000.00 1,050,000.00
Total 3,286,000.00 2,350,000.00
Note ①: According to Document SHEN JING MAO FA [2002] No. 93, the Companys technology center has been
expertised as an Enterprise Technology Center of Shenzhen and therefore it has obtained a supporting fund amounting to
CNY 3,000,000 for construction of the enterprise technology center. The fund is used for purchasing equipment. The
project was completed in early 2009, and the amount amortized every year is CNY 600,000.00 and the accumulative
amount amortized so far is CNY 1,800,000.00.Ended June 30, 2012, the balance of the fund was CNY 1,200,000.00.
Note ②: It is the specialized budget for the provincial and ministrial IUR cooperation commissioner project
according to Document YUE CAI JIAO [2009] No. 138.
Note ③: It is the fund for supporting implementation of standardization strategy obtained according to the Circular on
Issuing the Plan of Fund for Supporting Implementation of Standardization Strategy in Shenzhen in 2011 (SHEN SHI
[2012] No. 1) jointly promulgated by Market Supervision Administration of Shenzhen Municipality and Finance
Commission of Shenzhen Municipality;
Note ④: It is the money award from the patent awards obtained according to the Circular on Appropriation of the
th
Awarding Fund for 12 China Patent Awards promulgated by Intellectual Property Bureau of Guangdong Province.
47. Share Capital
In CNY
Increase/ decrease in the reporting period
Beginning of End of the
Shares
the reporting Bonus reporting
New issuing converted Others Sub-total
period shares period
from reserve
Total Shares 392,767,870 0 392,767,870
48. Treasury stock
Inapplicable
49. Special reserve
Inapplicable
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50. Capital reserve
In CNY
Beginning of the Increase in the Decrease in the End of the
Items
reporting period reporting period reporting period reporting period
Capital premium
(Share capital premium) 516,114,504.13 5,100,000.00 511,014,504.13
Other capital reserve 65,492,448.65 51,000,000.00 14,492,448.65
Total 581,606,952.78 0.00 56,100,000.00 525,506,952.78
51. Surplus reserve
In CNY
Beginning of the Increase in the Decrease in the End of the
Items
reporting period reporting period reporting period Reporting Period
Statutory surplus reserve 131,323,437.78 131,323,437.78
Discretionary surplus
0.00 0.00
reserve
Reserve fund
Enterprise development
fund
Others
Total 131,323,437.78 0.00 0.00 131,323,437.78
Note to the surplus reserve: in case of conversion of surplus reserve into share capital, making up losses or distribution of
dividend, the relevant resolutions should be specified:
According to the Company Law and the articles of association, the Company provides statutory surplus reserve based on
10% of the net profit. The statutory surplus reserve may no longer be provided in case its accumulative amount exceeds
50% of the Companys registered capital.
52. General risk reserve
Inapplicable
53. Retained earnings
In CNY
Items Amount Provision or
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distribution
proportion
Retained earnings at the end of the
343,661,076.07 --
previous year before adjustment:
Adjustment: Total of the retained
earnings at year beginning (adjusting up -16,139,115.49 --
+, and adjusting down -)
Retained earnings at year beginning
353,534,591.20 --
after adjustment
Plus: Net profit attributable to the parent
65,289,417.62 --
companys owners
Less: Provision of statutory surplus
reserve
Provision of discretionary surplus
reserve
Provision of reserve against general
risks
Dividend of ordinary shares payable 39,276,787.00
Dividend for common shares converted
Retained earnings at the end of the
353,534,591.20 --
reporting period
Details of adjustment of the retained earnings at year beginning:
1) As retroactive adjustment was made according to the Enterprise Accounting Standards and its relevant new provisions,
the retained earnings at year beginning was influenced by CNY 0.00.
2) Due to change of the accounting policy, the retained earnings at year beginning was influenced by CNY 0.00.
3) Due to correction of material accounting errors, the retained earnings at year beginning was influenced by CNY 0.00.
4) Due to change of the consolidation scope caused by the same control, the retained earnings at year beginning was
influenced by CNY-16,139,115.49.
5} Total of other adjustments influencing the retained earnings at year beginning: CNY 0.00.
Note to the retained earngings: For an IPO company, should the accumulated profit before IPO be shared by new and old
shareholders through resolution of the shareholders general meeting, it should be specified; should the accumulated
profit before IPO be distributed and exclusively shared by the old shareholders before IPO through resolution of the
shareholders general meeting, the Company should disclose explicitly the amount of the profit in the dividend shared by
the old shareholders.
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54. Operating revenues and costs
(1) Operating revenues and Costs
In CNY
Amount incurred in the reporting Amount incurred in the previous
Items
period period
Revenue from principal business 1,474,150,751.69 1,223,457,139.19
Revenue from other business 9,605,059.67 8,553,597.22
Operating costs 987,034,886.89 820,486,746.77
(2) Principal Businesses Based on Sectors
In CNY
Amount incurred in the reporting period Amount incurred in the previous period
Sectors
Operating revenue Operating costs Operating revenue Operating costs
Commerce 1,173,543,916.34 874,237,801.34 985,226,194.66 731,589,066.51
Industry 265,901,475.21 99,165,431.92 203,826,024.40 75,610,683.70
Property operation 34,705,360.14 10,394,436.10 34,404,920.13 10,516,401.34
Total 1,474,150,751.69 983,797,669.36 1,223,457,139.19 817,716,151.55
(3) Principal Businesses Based on Products
In CNY
Amount incurred in the reporting period Amount incurred in the previous period
Product names
Operating revenue Operating costs Operating revenue Operating costs
Sales of foreign top brand
1,173,543,916.34 874,237,801.34 985,226,194.66 731,589,066.51
watches
Sales of FIYTA watches 265,901,475.21 99,165,431.92 203,826,024.40 75,610,683.70
Property operation 34,705,360.14 10,394,436.10 34,404,920.13 10,516,401.34
Total 1,474,150,751.69 983,797,669.36 1,223,457,139.19 817,716,151.55
(4) Principal Businesses Based on Regions
In CNY
Amount incurred in the reporting period Amount incurred in the previous period
Regions
Operating revenue Operating costs Operating revenue Operating costs
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Northeast China 139,682,464.71 103,378,488.35 116,211,424.07 84,771,953.67
North China 292,156,396.04 222,903,895.50 228,555,105.04 170,977,378.41
Northwest China 331,183,745.81 247,305,324.50 297,685,676.30 216,749,024.10
Southwest China 110,244,661.48 80,191,581.27 82,324,718.58 56,998,772.65
East China 182,965,167.64 130,002,925.44 148,908,755.02 104,190,737.58
South China 417,918,316.01 200,015,454.30 349,771,460.18 184,028,285.13
Total 1,474,150,751.69 983,797,669.36 1,223,457,139.19 817,716,151.55
(5) Sales Income from Top Five Customers
In CNY
Proportion in the Companys total sales income
Customers Revenue from principal business
(%)
Xian Kaiyuan BELL TOWER
Shop 35,584,269.64 2.4%
Taiyuan International Trade
34,972,656.76 2.36%
Center Shop
Shop in Xidan Department
29,987,278.73 2.02%
Store, Beijing
Pinghetang Shop, Changsha 24,475,687.48 1.65%
WEALTH Shop, Nanchang 22,550,394.94 1.52%
Total 147,570,287.55 9.95%
55. Income from Contract Projects
Inapplicable
56. Business Taxes and Surcharges
In CNY
Amount incurred in Amount incurred in
Items Payment rate
the reporting period the previous period
Consumption tax 390,919.01 144,333.33 20%
Business tax 2,186,160.79 2,288,524.23 5%
Urban maintenance and
3,385,114.47 2,001,849.77 7%
construction tax
Education Surcharge 1,780,203.75 889,385.27 3%
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Resesource tax
Others 591,285.49 360,472.46
Total 8,333,683.51 5,684,565.06 --
57. Income from change of fair value
In CNY
Amount incurred in the reporting Amount incurred in the previous
Source of income from change of fair value
period period
Held for trading financial assets
Including: Income from change of fair value
arising from derivative financial instrument
Transactional monetary liabilities
Investment based real estate measured
based on fair value
Others 0.00 0.00
Total 0.00 0.00
58. Investment income
(1) Details of investment income
In CNY
Amount incurred in the reporting Amount incurred in the previous
Items
period period
Income from long term equity investment
0.00 0.00
based on cost method
Income from long term equity investment
191,373.86 -48,985.48
based on equity method
Investment income arising from disposal of
long term equity investment
Investment income acquired during the period
of holding the transactional financial assets
Investment income earned during the
investment income period from
held-to-maturity investment
Investment income acquired during the period
of holding the available-for-sale financial
assets
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Investment income acquired from disposal of
the transactional financial assets
Investment income acquired from the
held-to-maturity investment
Investment income acquired during the period
of holding-for-sale financial assets, etc.
Others
Total 191,373.86 -48,985.48
(2) Income from long term equity investment calculated based on the cost method
In CNY
Amount incurred in Cause of increase/decrease in
Amount incurred in
Investees the previous the reporting period over the
the reporting period
period previous period
Total 0.00 0.00 --
(3) Income from long term equity investment calculated based on the equity method
In CNY
Amount incurred in Cause of increase/decrease in
Amount incurred in
Investees the previous the reporting period over the
the reporting period
period previous period
Research Institute of
Decrease of net profit of the
Northwestern Polytechnical -48,985.48
investee in the reporting period
University
Shanghai Watch Industry Co., Increase of net profit of the
191,373.86
Ltd. investee in the reporting period
Total 191,373.86 -48,985.48 --
59. Loss from impairment of assets
In CNY
Amount incurred in the Amount incurred in the previous
Items
reporting period period
I. Loss from bad debt -4,298.70
II. Loss from price falling of inventories 2,256,450.85
III. Loss from impairment of available-for-sale
financial assets
IV. Loss from impairment of the held-to-maturity
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investment
V. Loss from impairment of long-term equity
investments
VI. Loss from impairment of investment based real
estate
VII. Loss from impairment of fixed assets
VIII. Loss from impairment of engineering supplies
IX. Loss from impairment of
construction-in-progress
X. Loss from impairment of production based
biological assets
XI. Loss from impairment of oil and gas assets
XII. Loss from impairment of intangible assets
XIII. Loss from impairment of goodwill
XIV. Others
Total -4,298.70 2,256,450.85
60. Non-operating income
(1)
In CNY
Amount incurred in the Amount incurred in the previous
Items
reporting period period
Total gains from disposal of non-current asset 2,464.55 50,844.86
Including: Income from disposal of fixed assets 2,464.55 50,844.86
Income from disposal of intangible assets
Income from reorganization of liabilities
Benefit from non-monetary assets exchange
Acceptane of donation
Government subsidies 567,500.00 1,026,556.00
Others 1,271,678.10 296,965.11
Total 1,841,642.65 1,374,365.97
(2) Statement of Government Subsidies
In CNY
Items Amount incurred in Amount incurred in Notes
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the reporting period the previous period
Fund subsidy for financial
support of intellectual property 100,000.00
sub-item
Award of doing bigger and
stronger for trade distribution 300,000.00
enterprises
Development fund for medium
26,556.00
and small enterprises
Quality award from Nanshan
500,000.00
District Government
Science & Technology Awards
100,000.00
of Guangdong Province
Financial support from
implementation of 467,500.00 100,000.00
standardization strategy
Total 567,500.00 1,026,556.00 --
61.Non-operating expenses
In CNY
Amount incurred in the Amount incurred in the
Items
reporting period previous period
Total loss from disposal of the non-current assets 11,895.85 487.00
Including: Loss from disposal of fixed assets 11,895.85 487.00
Loss from disposal of intangible asset
Loss from debt restructuring
Loss from non-monetary assets exchange
External donation 90,000.00
Others 3,532.37 5,866.38
Total 105,428.22 6,353.38
62. Income tax expenses
In CNY
Amount incurred in the Amount incurred in the
Items
reporting period previous period
The income tax in the reporting period calculated
22,438,602.06 30,736,895.33
according to the tax law and the relevant provisions.
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Adjustment of deferred income tax -5,264,777.74 -12,934,717.90
Total 17,173,824.32 17,802,177.43
63.Process of calculation of basic earnings per share and diluted earnings per share
In the reporting period, there existed no potential ordinary shares with dilution in the Company. Therefore, the diluted
earning per share is equal to the basic earning per share.
In calculating the basic earnings per share, the current net profit attributable to shareholders of ordinary shares is:
Items Amount in the Amount in the
reporting period same period of the
previous year
Net profit attributable to the shareholders of ordinary shares 65,159,296.28 79,173,594.56
Including: Net profit attributable to continuous operation 65,159,296.28 79,173,594.56
Net profit attributable to the Companys shareholders of ordinary shares 66,121,488.44 87,145,297.28
less non-recurring gain and loss
Including: Net profit attributable to continuous operation 66,121,488.44 87,145,297.28
Basic earning per share =P0÷S
S= S0＋S1＋Si×Mi÷M0–- Sj×Mj÷M0-Sk
Where: P0 is the net profit attributable to the Companys shareholders of common shares or the net profit less the
non-recurring gain and loss attributable to the shareholders of common shares. S is the weighted average of ordinary
shares issued externally; S0 is the total number of shares at the beginning of the reporting period; S 1 is the number of
shares increased due to conversion of public reserve into share capital or dividend distribution in the reporting period; S i is
the number of newly added shares from issuing new shares or shares converted from bonds in the reporting period; Sj is
the number of shares decreased due to repurchase in the reporting period; Sk is the number of shares shrunk in the
reporting period; M0 is the number of months in a reporting period; Mi is the accumulative monthly amount from the next
month of increasing shares to the end of the reporting period; Mj is the accumulative monthly amount from the next month
of decreasing shares to the end of the reporting period
In calculating the earnings per share, denominator was the weighted average of ordinary shares issued outside and the
calculation process is as follows:
Items Amount in the Amount in the
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reporting period same period of the
previous year
Number of ordinary shares issued outside in the previous year 392,767,870.00 280,548,479.00
Amount involved in adjustment of bonus shares and share allotment - 112,219,391.00
Number of ordinary shares issued outside at year beginning - -
Plus: Number of shares of non-public designated issuing - -
Weighted number of ordinary shares issued in the reporting year - -
Weighted number of ordinary shares issued outside at year end 392,767,870.00 392,767,870.00
Note ①: On April 8, 2011, the Company took the total share capital of 280,548,479 shares as at December 31, 2010 as
the base, converted its capital reserve into share capital at the rate of 4 shares for every 10 shares. The total volume of
share capital converted was 112,219,391 shares.
64. Other comprehensive income
In CNY
Amount incurred in Amount incurred in
Items
the reporting period the previous period
1. Amount of gain/(loss) arising from available-for-sale financial assets
Less: Influence upon income tax from available-for-sale financial
assets
Net gain/loss previously recorded in other comprehensive gains
transferred to the current gain/loss
Sub-total 0.00 0.00
2. The share calculated according to the equity method and enjoyed in
the other comprehensive income of the investee
Less: Influence upon the income tax arising from the share
calculated according to the equity method and enjoyed in the other
comprehensive income of the investee
Net gain/loss previously recorded in other comprehensive gains
transferred to the current gain/loss
Sub-total 0.00 0.00
3. Amount of gain/(loss) arising from the cash flow hedge instrument
Less: Influence upon income tax arising from the cash flow hedge
instrument
Net gain/loss previously recorded in other comprehensive gains
transferred to the current gain/loss
Amount of adjustment of the amount transferred into the hedge item
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recognized initially
Sub-total 0.00 0.00
4. Conversion difference in foreign currency statements -1,485,490.34 2,071,076.23
Less: Net in disposal of overseas operation transferred to the current
gain/loss
Sub-total -1,485,490.34 2,071,076.23
5. Others
Less: Influence upon the income tax arising from others recorded in
the other comprehensive income
Net of the gain/loss recorded previously in the other comprehensive
gains transferred to the current gain and loss
Sub-total 0.00 0.00
Total -1,485,490.34 2,071,076.23
65. Cash Flow Statement
(1) Other business related cash receipts
In CNY
Items Amount
Commodity promotion 6,964,074.85
Government subsidies 1,306,855.26
Deposit 688,823.43
Interest income 782,438.91
Reserves 1,730,167.76
Others 1,092,618.07
Total 12,564,978.28
(2) Other business related cash payments
In CNY
Items Amount
Rental 35,099,456.93
Advertisement 18,557,304.14
Market promotion 17,365,427.63
Supermarket expenses 15,273,730.20
Bank service charges 8,918,864.86
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Administrative expenses 4,875,051.47
Business travel 5,326,750.07
Water and electricity 6,810,237.83
R & D costs 6,326,203.26
Business entertainment 3,442,497.90
Transportation 1,674,696.64
Packing 4,125,184.20
Trade union budget 1,927,730.36
Post and telecommunications 1,179,005.18
Insurance premium 1,731,836.80
Remuneration to agent(s) engaged by the Company 1,501,037.00
Meeting 1,866,812.03
Repairs and maintenance 1,161,380.53
Exhibition 2,880,436.15
Automobile expenses 573,700.31
Training 1,637,048.26
Donation payment 90,000.00
Securities 428,754.37
Consulting 959,857.00
Total 143,733,003.12
(3) Cash received from other investment related activities
In CNY
Items Amount
Total 0.00
(4) Cash paid for other investment related activities
In CNY
Items Amount
Total 0.00
(5) Other financing related cash received
In CNY
Items Amount
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Notes payable 125,000,000.00
Total 125,000,000.00
(6) Other financing related cash paid
In CNY
Items Amount
Collateral charge
Others 1,031,250.90
Total 1,031,250.90
66. Supplementary information of the cash flow statement
(1) Supplementary information of the cash flow statement
In CNY
Amount in the reporting Amount in the
Supplementary Information
period previous period
1. Net cash flows arising from adjustment of net profit into
-- --
operating activities:
Net profit 65,159,296.28 79,350,294.33
Plus: Provisions for impairment of assets -4,298.70 2,256,450.85
Depreciation of fixed assets, oil and gas assets, production based
16,155,014.09 12,770,594.20
biological asset
Amortization of intangible assets 668,682.58 443,724.15
Long-term expenses to be apportioned 29,139,237.95 19,274,937.49
Loss (gain is stated with “-“) from disposal of fixed assets,
9,431.30 -50,357.86
intangible assets and other long term assets
Loss on scrapping of fixed assets (gain is stated with “-“)
Loss from change of fair value (gain is stated with “-“)
Financial expenses (gain is stated with “-“) 51,135,088.70 28,388,012.25
Investment loss (gain is stated with “-“) -191,373.86 48,985.48
Decrease of deferred income tax asset (increase is stated with
-5,264,777.74 -13,136,234.66
“-“)
Increase of deferred income tax asset (decrease is stated with
0.00 201,516.76
“-“)
Decrease of inventories (increase is stated with “-“) -157,959,058.31 -235,695,986.96
Decrease of operative items receivable (Increase is stated with -76,634,180.16 -51,213,146.88
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“-“)
Increase of operative items payable (Decrease is stated with “-“) -15,560,265.76 50,712,640.88
Others
Net cash flow arising from operating activities -93,347,203.62 -106,648,569.97
2. Significant investment and fund-raising activities with no cash
-- --
income and expenses involved:
Capital converted from liabilities
Convertible company bonds due within a year
Fixed assets rented through financing
3. Net change in cash and cash equivalents: -- --
Ending cash balance 210,307,884.08 664,455,817.52
Less: Opening cash balance 179,972,430.02 307,299,990.92
Plus: Ending balance of cash equivalent 0.00 0.00
Less: Opening balance of cash equivalent 0.00 0.00
Net increase in cash and cash equivalents 30,335,454.06 -357,155,826.60
(2) Information concerning acquisition or disposal of subsidiaries and other operating units in
the reporting period
In CNY
Amount incurred in Amount incurred in
Supplementary information
the reporting period the previous period
I. Information on acquisition of subsidiaries and other operating units: -- --
I. Price for acquisition of subsidiaries and other operating units
2. Cash and cash equivalents for acquisition of subsidiaries and other
operating units
Less: Cash and cash equivalents held by subsidiaries and other
operating units
3. Net cash paid for acquisition of subsidiaries and other operating
0.00 0.00
units
4. Acquisition of net assets from subsidiaries 0.00 0.00
Current assets
Non-current assets
Current liabilities
Non-current liabilities
II. Information on disposal of subsidiaries and other operating units: -- --
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I. Price for disposal of subsidiaries and other operating units
2. Cash and cash equivalents for disposal of subsidiaries and other
operating units
Less: Cash and cash equivalents held by subsidiaries and other
operating units
3. Net cash received from disposal of subsidiaries and other operating
0.00 0.00
units.
4. Disposal of net assets from subsidiaries 0.00 0.00
Current assets
Non-current assets
Current liabilities
Non-current liabilities
(3) Composition of cash and cash equivalents
In CNY
Beginning of the reporting
Items End of the reporting period
period
I. Cash 210,307,884.08 179,972,430.02
Incl: Cash in hand 677,749.44 588,590.81
Bank deposit available for payment at any time 209,559,779.51 179,370,584.08
Other monetary fund used for payment at any
70,355.13 13,255.13
time
Fund deposited with the central bank used for
payment
Due from banks
Inter-bank lending/borrowing
II. Cash equivalents 0.00 0.00
Including: Bond investment due within three months
III. Ending balance of cash and cash equivalents 210,307,884.08 179,972,430.02
176
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67. Note to items in the statement of change in owner’s equity
Inapplicable
(VIII) Accounting treatment of asset securitization business
1. Description of arrangement of the major asset securitization businesses, their accounting
treatment and bankruptcy isolation articles
Inapplicable
2. About the special purpose principal with no control power but substantially undertaking the
Company’s risks
Inapplicable
(IX) Related parties and related transactions
1. About the Company’s Parent
In CNY
Proporti Voting
on of the power
Compan proporti The
ys on of the Compan
Place of Legal Register Organiz
Relation Enterpri Busines Currenc shares parent ys
Parent Registra represe ed ation
ship se type s nature y held by compan eventual
tion ntative: capital Code
the y over controlle
parent the r
compan Compan
y (%) y (%)
Investin
g and
initiating
entities, China
CATIC
domesti National
Shenzh Controlli
Wu c Aviation
en ng Compan Shenzh 673,367 219351
Guangq commer CNY 41.49% 41.49% Industry
Holding sharehol y limited en ,100.00 229
uan ce, Group
s der
goods Corpora
Limited
and tion
material
s supply
and
177
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sales
Note to the Companys Parent:
The equity proportion in CATIC Shenzhen held by China National Aero-Technology Corporation Shenzhen is 58.77%.
China National Aero-Technology Corporation Shenzhen is a solely funded subsidiary of AVIC International Holding
Corporation (AVIC International). Aviation Industry Corporation of China directly holds 62.52% equity in AVIC International.
Therefore, the Companys eventual controller is Aviation Industry Corporation of China.
178
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2. About the Subsidiaries
In CNY
Holding Proportion of
Place of Legal Business Registered Organization
Full Names of Subsidiaries Subsidiary type Enterprise type Currency proportions voting power
Registration representative: nature capital Code
(%) (%)
Shenzhen Harmony World Controlled Company
Shenzhen Xu Dongsheng Commerce 600,000,000.00 CNY 100% 100% 279313935
Watches Center Co., Ltd. subsidiary limited
Shenzhen FIYTA
Controlled Company
Sophisticated Timepieces Shenzhen Xu Dongsheng Manufacture 10,000,000.00 CNY 100% 100% 715210802
subsidiary limited
Manufacture Co., Ltd.
Shenzhen World Watches Controlled Company
Shenzhen Fang Juan Commerce 2,800,000.00 CNY 50% 50% 192236228
Center Co., Ltd. subsidiary limited
Controlled Company
FIYTA Hong Kong Limited Hong Kong - Commerce 65,060,000.00 HKD 100% 100% 37954781
subsidiary limited
Controlled Company
68-Station Limited Hong Kong - Commerce 3,800,000.00 HKD 60% 60% 50994724
subsidiary limited
Harbin World Watches Controlled Company
Harbin Lu Bingqiang Commerce 500,000.00 CNY 100% 100% 127592103
Distribution Co., Ltd. subsidiary limited
Beijing Henglianda Controlled Company
Beijing Fang Juan Commerce 30,000,000.00 CNY 100% 100% 775466877
Timepiece Co., Ltd. subsidiary limited
Shenzhen FIYTA Technology Controlled Company
Shenzhen Xu Dongsheng Manufacture 10,000,000.00 CNY 100% 100% 69396758X
Development Co., Ltd. subsidiary limited
Shenzhen Symphony Controlled Company
Shenzhen Xu Dongsheng Commerce 5,000,000.00 CNY 100% 100% 697108950
Trading Co., Ltd. subsidiary limited
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Shenzhen Harmony Culture Controlled Company
Shenzhen Fang Juan Commerce 500,000.00 CNY 100% 100% 562782024
Communication Co., Ltd. subsidiary limited
Emile Chouriet (Shenzhen) Controlled Company
Shenzhen Lu Bingqiang Commerce 5,000,000.00 CNY 100% 100% 550312818
Co., Ltd. subsidiary limited
Harmony World Watches Controlled Company 53289178-000-11-
Hong Kong - Commerce 10,000,000.00 HKD 100% 100%
International Limited subsidiary limited 10-4
Controlled Company
FIYTA Sales Co., Ltd. Shenzhen Xu Dongsheng Commerce 50,000,000.00 CNY 100% 100% 57476869-2
subsidiary limited
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3. Joint Ventures and Associates
In CNY
Proportio
Proportion
n of the Total
of the
Company Total business Net profit
Place of Legal shares Total Total net
Enterprise Business Registere s voting liabilities income in in the Relations Organizati
Investees Registrati represent Currency held by assets at asset at
type nature d capital power in at year the reporting hip on Code
on ative: the year end year end
the end reporting period
Company
investee period
(%)
(%)
I. Joint
-- -- -- -- -- -- -- -- -- -- -- -- -- -- --
venture
II.
Associate -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
s
Shanghai
Dong
Watch Company Manufact 15,350,00 74,500,15 4,420,187 70,079,96 23,039,05 765,495.4 13465765
Shanghai Guozhan CNY 25% 25% Associate
Industry limited ure 0.00 4.65 .14 7.51 3.58 2 7
g
Co., Ltd.
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4. The Company’s other related parties
Other related parties Relationship with the Company Organization Code
Shenzhen CATIC Property Management
under the control of the same party 19219400-5
Co., Ltd. (CATIC Property)
Shenzhen CATIC Building Equipment Co.,
under the control of the same party 743201073
Ltd. (CATIC Building)
Rainbow Supermarket Co., Ltd. (Rainbow
under the control of the same party 618842912
Supermarket)
Shennan Circuit Co., Ltd. (Shennan Circuit) Associate of a controlled subsidiary 192195761
Shenzhen CATIC Monitor Technology Co.,
under the control of the same party 689407061
Ltd. (CATIC Monitor)
CATIC Real Estate under the control of the same party 279340845
Shenzhen Makway Cable TV Equipment
under the control of the same party 618810902
Co., Ltd. (Makway)
CATIC Securities Co., Ltd. (CATIC
under the control of the same party 741986153
Securities)
Shenzhen Grand Skylight Hotel
Management Co., Ltd. (Hotel under the control of the same party 76197033-5
Management)
Shenzhen CATIC Nanguang Elevator Co.,
under the control of the same party 192350741
Ltd. (CATIC Nanguang)
Shenzhen CATIC CITY Property
Development Co., Ltd. (CATIC CITY under the control of the same party 676667833
Property)
Shenzhen CATIC CITY Development
under the control of the same party 192194005
Co., Ltd. (CATIC CITY Development)
CATIC Land Development Co., Ltd.
under the control of the same party 661015568
(CATIC Land)
CATIC Guanlan Real Estate Development
under the control of the same party 763495945
Co., Ltd. (Guanlan Rea Estate)
CATIC Changtai Investment
Development Co., Ltd. (CATIC under the control of the same party 732047808
Changtai)
Shenzhen CATIC Construction Supervision
under the control of the same party 192309191
Co., Ltd. (CATIC Construction Supervision)
Shenzhen CATIC Jiufang Assets
under the control of the same party 580064616
Management Co., Ltd. (Jiufang Assets)
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CATIC Trust Co. under the control of the same party 158265930
Ganzhou CATIC Real Estate Development
under the control of the same party 664794739
Co., Ltd. (Ganzhou CATIC Real Estate)
Shenzhen CATIC Decoration Design
under the control of the same party 192268123
Engineering Co., Ltd. (CATIC Decoration)
Zhonghang Electronic Measuring
under the control of the same party 74501611-1
Instruments Co., Ltd
Xian Zhongfei Aviation Testing Technology
under the control of the same party 71017615-8
Development Co., Ltd.
5. Related transactions
(1) Statement of Commodities Purchased and Labor Services Received
In CNY
Amount incurred in the reporting Amount incurred in the previous
period period
Proporti Proporti
Pricing of related
on in the on in the
Description of Related transactions and
Related Parties amount amount
Transactions decision making
Amount of the Amount of the
procedures
similar similar
transacti transacti
ons (%) ons (%)
CATIC Property Property management Contract price 592,852.33 100% 724,888.81 100%
Ganzhou CATIC
Real Estate
Rent Contract price 337,664.80 1%
Development Co.,
Ltd.
Rainbow Franchise counter
Contract price 10,622,443.66 5.92% 8,311,541.70 5.7%
Supermarket sales costs
Statement of Sales of Goods and Supply of Labor Services
In CNY
Description of Related Pricing of related Amount incurred in the reporting Amount incurred in the previous
Related Parties
Transactions transactions and period period
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decision making Proporti Proporti
procedures on in the on in the
amount amount
Amount of the Amount of the
similar similar
transacti transacti
ons (%) ons (%)
Aviation Industry
Sale of products Contract price 3,886,999.48 0.26% 15,180,771.29 1.28%
Corporation
Rainbow
Sale of products Contract price 36,158,164.63 2.45% 30,948,455.36 2.61%
Supermarket
SHENNAN Circuit Sales of raw materials Contract price 790,736.23 0.05% 1,232,428.48 12.07%
(2) Related trust/contract
Inapplicable
(3) Related Leases
Statement of leases
In CNY
Lease Influence
Amount Basis for income of the
Lease Lease
Leased Leased involved in determinin recognized lease
Lessor Lessees starting termination
asset assets the leased g the lease in the income
date date
assets income reporting upon the
period Company
CATIC
The May 16, May 15, Contract 992,214.0 Lease
Real Housing
Company 2012 2015 price 0 income
Estate
The February May 30, Contract 265,586.0 Lease
Makway Housing
Company 1, 2012 2013 price 0 income
The CATIC October September Contract 1,180,080. Lease
Housing
Company Property 1, 2007 30, 2012 price 00 income
The CATIC September September Contract 447,300.0 Lease
Housing
Company Securities 16, 2007 15, 2012 price 0 income
CATIC
The May 16, May 15, Contract Lease
CITY Housing 10,890.00
Company 2012 2015 price income
Property
The CATIC City May 16, May 15, Contract Lease
Housing 10,890.00
Company Developm 2012 2015 price income
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ent
GUANLAN
The May 16, May 15, Contract Lease
Real Housing 43,560.00
Company 2012 2015 price income
Estate
The CATIC May 16, May 15, Contract 627,264.0 Lease
Housing
Company Changtai 2012 2015 price 0 income
Grand
The August 1, July 31, Contract 1,750,000. Lease
Skylight Housing
Company 2009 2012 price 00 income
Hotel Co.
Rainbow
The May 1, April 30, Contract 183,000.0 Lease
Supermark Housing
Company 2010 2013 price 0 income
et
CATIC
The May 16, May 15, Contract Lease
Supervisio Housing 87,120.00
Company 2012 2015 price income
n Co.
CATIC
Real
The Property May 16, May 15, Contract Lease
Estate 43,923.00
Company lease 2012 2015 price income
Developm
ent
The Jiufang July 19, June 30, Contract 181,818.0 Lease
Housing
Company Assets Co. 2011 2013 price 0 income
Grand
The May 16, May 15, Contract 118,203.0 Lease
Skylight Housing
Company 2012 2015 price 0 income
Hotel Co.
Statement of Tenancies
Inapplicable
(4) Related guarantee
In CNY
Amount in Guarantee starting Has the guarantee
Guarantor Guarantee Expiry of guarantee
guarantee date been implemented?
FIYTA Hong Kong
The Company 28,054,194.50 September 6, 2011 September 5, 2013 No
Limited
FIYTA Hong Kong
The Company 28,054,194.50 August 10, 2011 August 10, 2013 No
Limited
The Company HARMONY: 60,000,000.00 June 26, 2012 June 1, 2014 No
Manufacture Co. FIYTA Technology 30,000,000.00 December 26, 2011 December 25, 2012 No
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CATIC Shenzhen The Company 450,000,000.00 October 26, 2011 October 26, 2013 No
CATIC Shenzhen The Company 200,000,000.00 July 1, 2011 June 20, 2013 No
CATIC Shenzhen The Company 150,000,000.00 April 25, 2012 March 25, 2013 No
CATIC Shenzhen The Company 100,000,000.00 January 16, 2012 January 16, 2013 No
CATIC Shenzhen The Company 100,000,000.00 October 12, 2011 October 11, 2013 No
CATIC Shenzhen The Company 60,000,000.00 August 8, 2011 August 7, 2013 No
CATIC Shenzhen The Company 50,000,000.00 December 1, 2009 December 1, 2012 No
Note to related guarantees:
Ended June 30, 2012, the Group obtained a guarantee quota offered from CATIC Shenzhen amounting to CNY
1,110,000,000.00 for its short term borrowings amounting to CNY 990,000,000.00 and long term borrowings amounting to
CNY 106,008,389.00 with total sum of CNY 1,096,008,389.00.
(5) Lending and Borrowing with Related Parties
Inapplicable
(6) Assets assignment and debt restructuring transactions with the related parties
Inapplicable
(7) Other Related Transactions
The Company accepted 25% equity in Shanghai Watch Industry Co., Ltd. from CATIC Investment. Ended June 30, 2012,
the Company paid equity assignment consideration amounting to CNY 40,300,250.00 to Beijing Equity Exchange Co., Ltd.
and completed the procedures for change of the equity. The Company accepted 100% equity in Hengdarui from CATIC
Trust. Ended June 30, 2012, the Company paid equity assignment consideration amounting to CNY 56,100,000.00 and
completed the procedures for change of equity.
6. Receivables from and Payables to the Related Parties
Receivables from the related parties
In CNY
Amount at the end of the reporting Amount at the beginning of the
Description Related Parties
period reporting period
Accounts
receivable:
Rainbow
2,229,771.46 557,386.05
Supermarket
AVIC 68,223.00 612,683.00
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SHENNAN Circuit 787,374.33 1,594,705.04
Zhonghang
Electronic
40,748.00
Measuring
Instruments Co., Ltd
Xian Zhongfei
Aviation Testing
Technology 2,000,000.00
Development Co.,
Ltd.
Total 5,126,116.79 2,764,774.09
Advance payment:
CATIC Trust 28,050,000.00
CATIC Decoration 132,000.00
Total 28,182,000.00
Other receivables:
Shenzhen CATIC
Enterprise Group 189,600.00
Training Center
CATIC Monitor 102,500.00 102,500.00
Ganzhou CATIC
122,665.60 122,665.60
Real Estate Co.
Rainbow
113,401.60 79,951.60
Supermarket
Total 528,167.20 305,117.20
Payables to the related parties
In CNY
Amount at the end of the Amount at the beginning
Description Related Parties
reporting period of the reporting period
Advance receipts:
AVIC 630,204.50 515,296.00
Rainbow Supermarket 28,110.64
Total 630,204.50 543,406.64
Other payables:
CATIC Building 8,227.10 8,227.10
CATIC Nanguang 3,354.90 3,354.90
CATIC Property 146,792.85
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Management
CATIC Real Estate
37,700.00 85,800.00
Development
CATIC CITY Property 107,280.00
CATIC City Development 107,280.00
CATIC Securities 150,000.00 150,000.00
Makway 64,602.00 64,602.00
CATIC Real Estate 424,800.00 424,800.00
CATIC Changtai
221,712.00
Investment Development
Rainbow Supermarket 60,000.00 82,234.87
Research Institute of
Northwestern 1,350,000.00
Polytechnical University
Shenzhen CATIC
Enterprise Group 39,600.00
Training Center
Total 1,156,788.85 2,383,578.87
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(X)Share-based payment
1. General of share-based payment
Inapplicable
2. Share-based payment settled by equity
Inapplicable
3. Share-based payment settled by cash
Inapplicable
4. Share-based payment for services
Inapplicable
5. Amendment and termination of share-based payment
Inapplicable
(XI) Contingencies
1. Contingent liabilities arising from unsettled lawsuits/arbitration and the influence upon the
finance
Inapplicable
2. Contingent liabilities resulted from debt guarantee offered by other organizations and the
financial influence
Inapplicable
(XII) Commitments
1. Important Commitments
The irrevocable operating lease contracts executed between the Group and external parties by the balance sheet day are
as follows:
End of the Reporting
Items Year beginning
Period
Minimum rental payment for irrevocable operating lease:
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st
1 year after the Balance Sheet Day 16,596,975.70 48,365,970.37
nd
2 year after the Balance Sheet Day 44,332,818.00 37,813,993.80
rd
3 after the Balance Sheet Day 30,668,934.00 24,037,408.33
Subsequent years 36,211,497.00 25,739,708.33
Total 127,810,224.70 135,957,080.83
2. Implementation of the commitments in the previous period(s)
Inapplicable
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(XIII) Sequential Events after the Balance Sheet Day
1. Note to important sequential events after the balance sheet day
Inapplicable
2. Note to profit distribution after the balance sheet day
Inapplicable
3. Note to other sequential events after the balance sheet day
Inapplicable
(XIV) Note to Other Important Matters
1. Non-monetary assets exchange
Inapplicable
2. Debt restructuring
Inapplicable
3. Enterprise Consolidation
The 29th Meeting of the Sixth Board of Directors of FIYTA Holdings Ltd. held on December 14, 2011 approved Proposal
on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World Watches
Center Co., Ltd. and the Extraordinary Shareholders Meeting held on January 4, 2012 reviewed and approved the
Proposal on Acquisition of the Equity in Liaoning Hengdarui Commerce & Trade Co., Ltd. by Shenzhen Harmony World
Watches Center Co., Ltd. According to the Agreement on Assignment of the Equity to the Third Party and the Contract
on Equity Assignment, the Company paid CNY 28.05 million, the balance of the payment for the equity acquired equal to
50% of the total payment in February, 2012; the total payment involved in the equity acquisition was CNY 56.10 million. By
then, the Company had finished acquisition of 100% equity in Hengdarui. As the three parties participated in the
assignment of the equity, namely the Company, China National Aero-Technology Corporation Shenzhen, the Companys
actual controlling shareholder, and CATIC Trust Co., Ltd. are related parties. Therefore, in the reporting period, Hengdarui,
as an enterprise under common control, has been included in the consolidated statement range and the consolidation
date was February 28, 2012. According to the requirements of the enterprise accounting standards concerning
consolidation of enterprises under the common control, the Company made retroactive adjustment on the data at the year
beginning and the data of the same period of the previous year.
4. Lease
Inapplicable
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5. Oustanding convertible financial instruments at the end of the reporting period
Inapplicable
6. Main contents and significant change of the annuity plan
Inapplicable
7. Other important matters necessary to be disclosed
(XV) Notes to the principal items on the parent company’s financial statements
1. Accounts receivable
(1) Accounts receivable
In CNY
End of the Reporting Period Beginning of the reporting period
Book balance Bad debt reserve Book balance Bad debt reserve
Categories Pro
Propo Propo Propo
porti
Amount Amount rtion Amount rtion Amount rtion
on
(%) (%) (%)
(%)
Accounts receivable with
significant single amount 4.69
10,988,318.49 10,988,318.49 100% 10,988,318.49 5.47% 10,988,318.49 100%
and provision of bad debt %
reserve on individual basis
Accounts receivable for which bad debt reserve has been provided based on the grouping
Grouping based on the 2.87
6,732,834.69 364,221.52 5.41% 6,339,107.00 3.16% 368,520.22 5.81%
accounting age %
Grouping of the 184,408,417.4 78.6 151,354,145.5 75.33
0.00 0% 0.00 0%
designated accounts 3 9% 1 %
191,141,252.1 81.5 157,693,252.5 78.49
Sub-total of Groupings 364,221.52 0.19% 368,520.22 0.23%
2 6% 1 %
Accounts receivable with
insignificant single amount 13.7 16.04
32,229,445.53 32,229,445.53 100% 32,229,445.53 32,229,445.53 100%
and provision of bad debt 5% %
reserve on individual basis
234,359,016.1 200,911,016.5
Total -- 43,581,985.54 -- -- 43,586,284.24 --
4 3
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Note to the categories of accounts receivable:
Accounts receivable with significant single amount and provision of bad debt reserve on individual basis at the end of the
reporting period
In CNY
Description of accounts receivable Book Balance Bad debt reserve Provision proportion Provision reason
Beijing Urban/Rural Trade Center Co., Ltd. 2,033,710.15 2,033,710.15 100% Unrecoverable
Qingdao Handry Timepieces, Glasses and
1,298,215.01 1,298,215.01 100% Unrecoverable
Jewelry Co.
Timepieces and Sewing Machine
Wholesale Station of Yingkou General 982,604.03 982,604.03 100% Unrecoverable
Merchandise Co.
Jilin Timepieces and Photographic
890,387.77 890,387.77 100% Unrecoverable
Paraphernalia Wholesale Co.
Siping No. 1 Department Store 823,302.04 823,302.04 100% Unrecoverable
Anshan Timepieces and Photographic
807,815.02 807,815.02 100% Unrecoverable
Equipment Co.
Others 4,152,284.47 4,152,284.47 100% Unrecoverable
Total 10,988,318.49 10,988,318.49 -- --
In the grouping, the accounts receivable for which the bad debt reserve is provided based on the age analysis
In CNY
End of the reporting period Beginning of the reporting period
Book Balance Book Balance
Age
Propo Propo
Bad debt reserve Bad debt reserve
Amount rtion Amount rtion
(%) (%)
Within 1 year
Including: -- -- -- -- -- --
Sub-toal 78.95 89.77
5,315,290.92 281,656.58 5,627,353.57 285,955.28
within 1 year % %
16.85 10.78
1 to 2 years 1,134,631.86 68,327.94 683,279.43 68,327.94
% %
2 to 3 years 282,911.91 4.2% 14,237.00 28,474.00 0.45% 14,237.00
Over 3
0.00 0% 0.00 0.00 0% 0.00
years
3 to 4 years
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4 to 5 years
Over 5
years
Total 6,732,834.69 -- 364,221.52 6,339,107.00 -- 368,520.22
In the grouping, the account receivable for which reserve for bad debt is provided based on balance percentage:
Inapplicable
In the grouping, the accounts receivable for which the bad debt reserve is provided based on the other method:
In CNY
Grouping Description Book balance Bad debt reserve
Grouping of the designated accounts 184,408,417.43 0.00
Total 184,408,417.43 0.00
At the end of the reporting period, accounts receivable with insignificant single amount and provision of bad debt reserve
on individual basis
In CNY
Description of accounts
Book Balance Bad debt reserve Provision proportion Provision reason
receivable
Doubtful accounts/bad
32,229,445.33 32,229,445.33 100% Unrecoverable
debt
Total 32,229,445.53 32,229,445.53 100% --
(2) Accounts receivable reversed or recovered in the reporting period
Inapplicable
(3) The accounts receivable actually written-off in the reporting period
Inapplicable
(4) The account receivable from the shareholder holding over 5% (including 5%) of the
Company’s voting shares in the reporting period.
Inapplicable
(5) Type or description of the other receivables with bigger amount
Inapplicable
(6) Top five debtors of the accounts receivable
In CNY
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Proportion in the total of
Relationship with the
Company names Amount Years the accounts receivable
Company
(%)
FIYTA Sales Co., Ltd. Subsidiary 184,559,559.21 Within 1 year 78.75%
Shenzhen Huizheng
Non-Related Party 4,669,689.89 Within 1 year 1.99%
E-commerce Co., Ltd.
Beijing Urban/Rural
Non-Related Party 2,033,710.15 Over 3 years 0.87%
Trade Center Co., Ltd.
Qingdao Handry
Timepieces, Glasses and Non-Related Party 1,298,215.01 Over 3 years 0.55%
Jewelry Co.
Timepieces and Sewing
Machine Wholesale
Station of Yingkou Non-Related Party 982,604.03 Over 3 years 0.42%
General Merchandise
Co.
Total -- 193,543,778.29 -- 82.58%
(7) Accounts due from related parties
In CNY
Proportion in the total of the
Company names Relationship with the Company Amount
accounts receivable (%)
FIYTA Sales Co., Ltd. Subsidiary 184,559,559.21 78.75%
Aviation Industry Corporation the Companys actual controller 68,223.00 0.03%
Rainbow Supermarket Under the same control 25,589.29 0.01%
Harmony Subsidiary 12,827.74 0.01%
One of the controlling
Henglianda shareholders subsidiaries 1,279.20 0%
Total -- 184,667,478.40 78.8%
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(8) Amount of the accounts receivable transferred not in compliance with the conditions of
terminating confirmation
Inapplicable
(9)
For securitization on the assets of accounts receivable, it is necessary to summarize the relevant
transaction arrangement
Inapplicable
2. Other receivables
(1) Other receivables
In CNY
End of the reporting period Beginning of the reporting period
Book Balance Bad debt reserve Book Balance Bad debt reserve
Categories Pro Pro Pro Pro
porti porti porti porti
Amount Amount Amount Amount
on on on on
(%) (%) (%) (%)
Other receivables with
significant single amount and 0.18 100 0.25 100
2,215,684.09 2,215,684.09 2,215,684.09 2,215,684.09
provision of bad debt reserve % % % %
on individual basis
Other receivables for which bad debt reserve has been provided based on the grouping
Grouping based on the 0.18 12.7 0.14 21.5
2,139,434.81 273,027.10 1,264,828.33 273,027.10
accounting age % 6% % 9%
Grouping of the designated 99.5 99.4
1,214,815,527.07 0.00 0% 878,560,687.66 0.00 0%
accounts 2% 4%
99.7 0.02 99.5 0.03
Sub-total of Groupings 1,216,954,961.88 273,027.10 879,825,515.99 273,027.10
% % 8% %
Other receivables with
insignificant single amount 0.12 100 0.17 100
1,480,064.11 1,480,064.11 1,480,064.11 1,480,064.11
and provision of bad debt % % % %
reserve on individual basis
Total 1,220,650,710.08 -- 3,968,775.30 -- 883,521,264.19 -- 3,968,775.30 --
Other receivables with significant single amount and provision of bad debt reserve on individual basis at the end of the
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reporting period
In CNY
Other receivables Book Balance Amount of bad debt Provision proportion Reasons
Shenzhen New Longtai
1,573,876.89 1,573,876.89 100% Unrecoverable
Industrial Co. Ltd.
Zhuangtu Commodities
641,807.20 641,807.20 100% Unrecoverable
Trading Center
Total 2,215,684.09 2,215,684.09 -- --
In the combination, other receivables for which the bad debt reserve is provided based on the age analysis:
In CNY
End of the reporting period Beginning of the reporting period
Book Balance Book Balance
Age
Propo Propo
Bad debt reserve Bad debt reserve
Amount rtion Amount rtion
(%) (%)
Within 1 year
Including: -- -- -- -- -- --
Sub-toal within 59.29 40.69
1,268,515.38 25,726.99 514,539.90 25,726.99
1 year % %
11.13
1 to 2 years 238,131.00 30,486.41 304,864.10 24.1% 30,486.41
%
2 to 3 years 187,364.10 8.76% 8,847.70 29,492.33 2.33% 8,847.70
20.82 32.88
Over 3 years 445,424.33 207,966.00 415,932.00 207,966.00
% %
3 to 4 years
4 to 5 years
Over 5 years
Total 2,139,434.81 -- 273,027.10 1,264,828.33 -- 273,027.10
In the combination, other account receivable for which reserve for bad debt is provided based on balance percentage:
Inapplicable
In the combination, other receivable for which the bad debt reserve is provided based on other method:
In CNY
Grouping Description Book Balance Bad debt reserve
Grouping of the designated accounts 1,214,815,527.07 0.00
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Total 1,214,815,527.07 0.00
Other receivables with insignificant single amount and provision of bad debt reserve on individual basis at the end of the
reporting period
In CNY
Other receivables Book Balance Bad debt reserve Provision proportion Provision reason
Rent 814,950.63 814,950.63 100% Unrecoverable
Borrowings 400,000.00 400,000.00 100% Unrecoverable
Reserve for individuals of
156,020.47 156,020.47 100% Unrecoverable
service termination
Equity assignment
consideration 109,093.01 109,093.01 100% Unrecoverable
Total 1,480,064.11 1,480,064.11 100% --
(2) Other receivables reversed or recovered in the reporting period
Inapplicable
(3) Other receivables actually written-off in the reporting period
Inapplicable
(4) Other receivables from the shareholder holding 5% (including 5%) of the Company’s voting
shares in the reporting period.
Inapplicable
(5) Type or description of the other payables with bigger amount
Inapplicable
(6) Top Five Debtors of the Other Receivables
In CNY
Proportion in the total
Relationship with the
Company names Amount Years of the other
Company
receivables (%)
Harmony Subsidiary 1,059,738,317.37 Within 1 year 86.82%
FIYTA Sales Co. Subsidiary 70,520,391.69 Within 1 year 5.78%
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One of the controlling
Emile Chouriet shareholders
35,183,755.25 Within 1 year 2.88%
(Shenzhen) subsidiaries
Trade Co. Subsidiary 23,524,075.27 Within 1 year 1.93%
FIYTA Technology Subsidiary 13,497,275.43 Within 1 year 1.11%
Total -- 1,202,463,815.01 -- 98.51%
(7) Other receivables from related parties
In CNY
Relationship with the Proportion in the total of the
Company names Amount
Company other receivables (%)
Harmony Subsidiary 1,059,738,317.37 86.82%
FIYTA Sales Co. Subsidiary 70,520,391.69 5.78%
Emile Chouriet One of the controlling
35,183,755.25 2.88%
(Shenzhen) shareholders subsidiaries
Trade Co. Subsidiary 23,524,075.27 1.93%
FIYTA Technology Subsidiary 13,497,275.43 1.11%
Manufacture Co. Subsidiary 7,274,124.11 0.6%
FIYTA Hong Kong Limited Subsidiary 1,147,471.00 0.09%
Under the control of the
CATIC Monitor 102,500.00 0.01%
same party
Shenzhen CATIC
under the control of the
Enterprise Group Training 150,000.00 0.01%
same party
Center
Total -- 1,211,137,910.12 99.22%
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(8)Amount of the other receivables transferred not in compliance with the conditions of
terminating confirmation
Inapplicable
(9) For securitization on the assets of other receivables, it is necessary to summarize the relevant
transaction arrangement
Inapplicable
3. Long-term equity investment
In CNY
Note to
inconsis
tence of
Percent percenta Provisio
Voting
age of ge of n Cash
power
Accounti Initial Increase equity in equity Impairm reserve dividend
Investee Opening Ending percenta
ng investm /Decrea the in the ent provided in the
s balance balance ge in the
method ent cost se investee investee reserve in the reportin
investee
(%) s with reportin g period
(%)
Voting g period
power
percenta
ge
Harmon Cost 601,307 601,307 601,307
0.00 100% 100%
y method ,200.00 ,200.00 ,200.00
World
Cost 1,400,0 1,400,0 1,400,0
Watches 0.00 50% 100%
method 00.00 00.00 00.00
Center
Harbin Cost 125,000 125,000 125,000
0.00 100% 100%
Co. method .00 .00 .00
Manufac Cost 9,000,0 9,000,0 9,000,0 75,960,
0.00 100% 100%
ture Co. method 00.00 00.00 00.00 140.05
FIYTA
Cost 10,000, 10,000, 10,000,
Technol 0.00 100% 100%
method 000.00 000.00 000.00
ogy
FIYTA
Hong Cost 55,367, 55,367, 55,367,
0.00 100% 100%
Kong method 520.00 520.00 520.00
Limited
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Trade Cost 5,000,0 5,000,0 5,000,0
0.00 100% 100%
Co. method 00.00 00.00 00.00
Northwe
stern
Polytech
nical
Universi
Cost 1,350,0 1,863,5 -300,00 1,563,5
ty 45% 50%
method 00.00 72.76 0.00 72.76
Shenzh
en
Researc
h
Institute
Xian
Tangche
Cost 85,000. 85,000. 85,000.
ng Joint 0.00 0.1% 0.1%
method 00 00 00
Stock
Co., Ltd.
Shenzh
en
CATIC
Cost 300,000 300,000 300,000 300,000
Culture 0.00 15% 15%
method .00 .00 .00 .00
Commu
nication
Co., Ltd.
FIYTA
Cost 50,000, 50,000, 50,000,
Sales 0.00 100% 100%
method 000.00 000.00 000.00
Co.
Shangh
ai Watch
Equity 40,300, 40,491, 40,491,
Industry 0.00 25% 25%
method 250.00 623.86 623.86
Co.,
Ltd.,
774,234 734,448 40,191, 774,639 300,000 75,960,
Total -- -- -- --
,970.00 ,292.76 623.86 ,916.62 .00 140.05
4. Operating Income and Cost
(1) Operating income and cost
In CNY
Items Amount incurred in the reporting period Amount incurred in the previous period
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Income from principal businesses 78,724,691.50 226,264,903.90
Income from other businesses 4,135,571.06 3,156,792.71
Operating costs 46,268,068.51 108,169,866.25
(2) Principal business (based on sectors)
In CNY
Amount incurred in the reporting period Amount incurred in the previous period
Sectors
Revenues Operating costs Revenues Operating costs
FIYTA watches 44,019,331.36 31,755,058.40 191,859,983.77 95,045,040.40
Lease of property 34,705,360.14 10,394,436.10 34,404,920.13 10,516,401.34
Total 78,724,691.50 42,149,494.50 226,264,903.90 105,561,441.74
(3) Principal business (based on products)
Inapplicable
(4) Principal business (based on regions)
In CNY
Amount incurred in the reporting period Amount incurred in the previous period
Regions
Revenues Operating costs Revenues Operating costs
South China 76,348,764.95 37,004,205.13 104,662,623.46 42,826,487.92
East China 0.00 0.00 30,067,203.18 15,443,592.46
North China 266,952.19 174,799.51 27,379,914.83 13,649,678.30
Northwest China 1,750,000.00 4,735,434.50 22,932,699.13 11,663,574.71
Northeast China 0.00 0.00 22,023,685.70 12,310,285.01
Southwest China 358,974.36 235,055.36 19,198,777.60 9,667,823.34
Total 78,724,691.50 42,149,494.50 226,264,903.90 105,561,441.74
(5) Operating income from the company’s top five customers
In CNY
Proportion in the
Companys Total
Customers Total operating income
Operating
Income (%)
Shenzhen Tencent Computer System Co., Ltd. 12,057,202.50 14.55%
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Shenzhen Huizheng E-commerce Co., Ltd. 6,319,578.72 7.63%
Chow Tai Fook Jewellery (Shenzhen) Co., Ltd. 6,288,888.89 7.59%
Industrial and Commercial Bank of China Limited
1,321,900.80 1.6%
Shenzhen YouLiFeng Self-help Kara OK Recreation Supermarket Co., Ltd. 1,313,442.00 1.59%
Total 27,301,012.91 32.95%
5. Return on investment
(1) Details of return on investment
In CNY
Amount incurred in the
Items Amount incurred in
reporting period
the previous period
Return on long term equity investment based on cost method 75,960,140.05 34,187,130.93
Return on long term equity investment based on equity method 191,373.89 -48,985.48
Return on investment from disposal of long-term equity investment
Return on investment obtained during the holding of the transactional financial
assets
Return on investment obtained during the holding of the holding-to-maturity
investment
Return on investment obtained during the available-for-sale financial assets
Return on investment obtained from disposal of transactional financial assets
Return on investment from the held-to-due investment
Return on investment obtained from the available-for-sale financial assets
Others
Total 76,151,513.91 34,138,145.45
(2) Income from long term equity investment calculated based on the cost method
In CNY
Amount incurred in the Amount incurred in Cause of increase/decrease in the
Investees
reporting period the previous period reporting period over the previous period
Increase of net profit of the investee in
Manufacture Co. 75,960,140.05 30,786,321.10
the reporting year
FIYTA Technology 0.00 3,400,809.83 Retained dividend in the reporting period
Total 75,960,140.05 34,187,130.93 --
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(3) Income from long term equity investment calculated based on the equity method
In CNY
Amount incurred in the Amount incurred in Cause of increase/decrease in the
Investees
reporting period the previous period reporting period over the previous period
Northwestern Polytechnical University
0.00 -48,985.48 Equity assignment
Shenzhen Research Institute
Equity purchase completed in the
Shanghai Watch Industry Co., Ltd. 191,373.86 0.00
reporting period
Total 191,373.89 -48,985.48 --
6. Supplementary information of the cash flow statement
In CNY
Supplementary Information Amount in the reporting period Amount in the previous period
1. Net cash flows arising from adjustment of net profit into operating
-- --
activities:
Net profit 69,728,132.23 35,802,958.57
Plus: Provisions for impairment of assets -4,298.70 0.00
Depreciation of fixed assets, oil and gas assets, production based
9,429,450.96 9,551,664.64
biological asset
Amortization of intangible assets 663,022.60 443,724.15
Long-term expenses to be apportioned 5,271,263.77 6,341,035.05
Loss (gain is stated with “-“) from disposal of fixed assets, intangible
-451,657.57 -50,357.86
assets and other long term assets
Loss on scrapping of fixed assets (profit is stated with
“-“)
Loss from change of fair value (gain is stated with “-“)
Financial expenses (gain is stated with “-“) 12,769,119.71 10,183,933.21
Investment loss (gain is stated with “-“) -76,301,526.17 -34,138,145.45
Decrease of deferred income tax asset (increase is stated with “-“)
Increase of deferred income tax asset (decrease is stated with “-“) -6,777.24
Decrease of inventories (increase is stated with “-“) 32,293,251.47 -70,802,020.29
Decrease of operative items receivable (Increase is stated with “-“)
-332,833,427.40 50,537,978.99
Increase of operative items payable (Decrease is stated with “-“) 57,793,231.63 79,443,128.68
Others
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Net cash flow arising from operating activities -221,387,544.77 87,307,122.45
2. Significant investment and financing activities with no cash income and
-- --
expenses involved:
Capital converted from liabilities
Convertible company bonds due within a year
Fixed assets rented through financing
3. Net change in cash and cash equivalents: -- --
Ending cash balance 71,657,500.90 148,907,030.69
Less: Opening cash balance 49,327,161.12 529,568,738.47
Plus: Ending balance of cash equivalent
Less: Opening balance of cash equivalent
Net increase in cash and cash equivalents 22,330,339.78 -380,661,707.78
7. Assets and liabilities recorded based on the assessed value under counterpurchase
Inapplicable
(XVI) Supplementary information
1. Net assets-income ratio and earnings per share
In CNY
Earnings per share
Net assets-income ratio,
Profit of the reporting period Diluted earnings per
weighted average (%) Basic earnings per share
share
Net profit attributable to the Companys
4.63% 0.166 0.166
shareholders of ordinary shares
Net profit attributable to the Companys
shareholders of ordinary shares less 4.68% 0.168 0.168
non-recurring gains and loss
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2. Abnormal Conditions and Causes of the Major Items of the Accounting Statements
(1) Balance Sheet Items
A. Increase of the monetary funds over the year beginning by CNY 30.34 million, where the net cash flow arising from the
operating activities amounting to CNY -9328 million was mainly due to that with expansion of the marketing network size
of famous brand watches and FIYTA watches, the purchase cost increased correspondingly and cash outflow reached
CNY 101.04 million. Net cash flow arising from investment activities amounting to CNY –75.54 million mainly consisted of
payment for purchase of fixed assets and refurbishment of new shops amounting to CNY 47.54 million and payment for
purchase of the equity in HENGDARUI amounting to CNY 28.05 million.
Net cash flow arising from financing activities amounting to CNY 199.13 million mainly consisted of increase of the bank
loan amounting to CNY 176.10 million, discount of bank acceptance amounting to CNY 125 million, payment for bank loan
interest and payment of the dividends amounting to CNY 101.97 million.
B. Decrease of the advance payment over the year beginning by CNY 34.98 million was mainly due to decrease of the
advance payment in HARMONY by CNY 36.94 million over the year beginning.
C. Increase of accounts receivable by CNY 89.33 million over the year beginning was mainly due to growth of sales,
including that of HARMONY increased by CNY 62.58 million over the year beginning and that of FIYTA Watches
increased by CNY 26.61 million
D. Inventories increased by CNY 157.96 million over the year beginning mainly include inventories in HARMONY
increased by CNY 141.44 million for its newly opened shops and increase in purchase of leading brands and FIYTA
watches in stock increased by CNY 3.52 million/
E. Decrease of the short term borrowings by CNY 275.89 million over the year beginning was mainly due to increase of
the short term loan from the head office amounting to CNY 398 million, repayment of the bank loan by HARMONY
amounting to CNY 84 million, repayment of the short term borrowings by Manufacture Co. amounting to CNY 30 million
and repayment of the short term borrowings by FIYTA Hong Kong amounting to CNY 8.11 million.
F. Decrease of the capital reserve by CNY 56.10 million over the year beginning was mainly due to consolidation of the
enterprise under the common control. In the reporting period, HENGDARUI was brought into the consolidation range.
(2) Items in Profit Statement
A. The operation revenue in the reporting period was CNY 1,483.76 million, with a year-on-year growth of 20.43%. The
main reasons of the growth include gradual expansion of HARMONYs network size, gradual growth of the old shops
revenues, increase of the sales income of newly opened shops. Meanwhile, FIYTA watches experienced a over 30%
year-on-year growth.
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B. The operation costs in the reporting period amounted to CNY 987.03 million, a year-on-year growth of 20.30%. In the
reporting period, the Company made a good control in respect of terminal sales discount. The gross profit rate of
HARMONY world watches and FIYTA watches basically maintained stable.
C. The sales costs incurred in the reporting period amounted to CNY 260.55 million, a 39.68% growth over the same
period of the previous year. The growth was mainly due to corresponding increase of the sales costs with increase of the
sales income.
D. The amount of the administrative expenses incurred in the reporting period was CNY87.84 million, increased by CNY
86.97 million over the same period of the previous year. The growth of the revenues from the principal business slowed
down. The Company made some control over the salaries to employees and the growth of the administrative expenses
was brought under a certain control.
E. The amount of the financial expenses in the reporting period was CNY 59.6 million, a 74.07% year-on-year growth. It
was mainly due to that the investment for acquisition of assets and construction of network and channels increased by a
big margin over the same period of the previous year and the interest payment increased greatly correspondingly.
IX. Documents Available for Inspection
Table of Documents Available for Inspection
I. Semi-annual Report carried with personal signature of the Chairman of the Board;
II. Financial Report with signatures and seals of the principal of the Company, Chief Financial Officer and Manager of
the Accounting Department;
III. All the originals of the Companys documents disclosed to the public on the newspapers designated by China
Securities Regulatory Commission in the reporting period;
IV. Articles of Association of the Company.
Chairman of the Board: Wu Guangquan
Date of Approval for Submission of the Semi-annual Report by the Board of Directors: August 24, 2012
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