Section X. Financial Report
I. Audit reports
Whether the semi-annual report was audited or not
□ Yes √ No
The financial report of this semi-annual report was unaudited.
II. Financial State ment
Statement in Financial Notes are carried in RMB/CNY
1
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET
As at 30 June 2019
(Expressed in Renminbi Yuan)
ASSETS Note V 30 June 2019 31 December 2018
Current assets
Cash and bank balances 1 8,086,328,508.49 8,089,781,304.56
Notes receiv able 2 790,664,828.26 1,357,311,929.63
Accounts receiv able 3
11,826,440,731.59 9,336,861,647.92
Receivable financing 4 325,439,580.18 -
Advances to suppliers 5 357,078,819.64 583,484,515.95
Other receivables 6
654,086,387.85 643,493,359.32
Incl:Interest receivable 14,791,483.10 8,223,327.64
Inventories 7 4,882,673,616.27 4,389,335,942.19
Other current assets 8 97,317,287.60 95,347,629.18
Total current assets 27,020,029,759.88 24,495,616,328.75
Non-current assets
Long-term equity investments 9 2,077,811,395.30 1,880,393,786.10
Other equity instruments 10
investment 13,685,760.00 13,685,760.00
Other non-current financial assets 11 140,000,000.00 140,000,000.00
Investment properties 12 140,319,140.00 144,894,495.97
Fixed assets 13
593,552,480.99 607,933,827.67
Construction in progress 14 31,980,582.21 36,412,614.61
Right-of-use assets 15 1,910,981,197.63 -
Intangible assets 16
320,522,690.59 319,207,126.15
Goodw ill 17 847,041,800.60 833,547,800.60
Long-term prepaid expenses 18 311,311,781.97 311,328,706.46
Deferred tax assets 19
65,417,507.01 74,914,209.95
Other non-current assets 20 66,944,586.76 72,365,863.71
Total non-current assets 6,519,568,923.06 4,434,684,191.22
Total assets 33,539,598,682.94 28,930,300,519.97
The accompanying notes form an integral part of these financial statements
2
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET (Continued)
As at 30 June 2019
(Expressed in Renminbi Yuan)
LIABILITIES Note V 30 June 2019 31 December 2018
Current liabilities
Short-term borrowings 21 3,290,877,595.23 2,597,652,702.43
Notes payable 22 3,539,095,262.34 3,416,755,681.80
Accounts payable 23 8,088,697,602.94 6,468,535,961.17
Advances from customers - -
Employee benefits payable 25 161,719,082.78 231,866,407.40
Tax payable 26 215,579,001.83 241,980,412.72
Other payables 27 1,474,526,698.43 1,539,436,971.93
Incl: Interest payable 29,012,444.93 21,906,660.63
Dividends payable 6,389,320.96 6,389,320.96
Contract liabilities 24 239,739,020.90 255,590,612.37
Non-current liabilities due w ithin one year 28 558,296,784.75 5,861,324.37
Other current liabilities 29 445,493.48 292,465.75
Total current liabilities 17,568,976,542.68 14,757,972,539.94
Non-current liabilities
Long-term borrow ings 30 - 31,600,000.00
Lease liabilities 31 1,186,461,123.96 -
Long-term payables 32 800,000.00 4,563,978.52
Long-term employee benefits payable 33 1,915,000.00 2,050,000.00
Deferred income 34 88,722,818.18 91,491,170.40
Deferred tax liabilities 19 66,386,258.77 67,605,161.88
Other non-current liabilities 35 67,840,696.09 69,241,176.18
Total non-current liabilities 1,412,125,897.00 266,551,486.98
Total liabilities 18,981,102,439.68 15,024,524,026.92
The accompanying notes form an integral part of these financial statements
3
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET (Continued)
As at 30 June 2019
(Expressed in Renminbi Yuan)
SHAREHOLDERS’ EQUITY Note V 30 June 2019 31 December 2018
Shareholders’ equity
Share capital 36 428,126,983.00 428,126,983.00
Capital surplus 37 4,363,409,728.51 4,320,984,981.51
Surplus reserve 38 214,063,491.50 214,063,491.50
7,134,839,714.47 6,655,257,147.27
Retained earnings 39
Shareholders’ equity attributable 12,140,439,917.48 11,618,432,603.28
to shareholders of the parent
2,418,056,325.78 2,287,343,889.77
Non-controlling interests
Total shareholders’ equity 14,558,496,243.26 13,905,776,493.05
Total liabilities and shareholders’ 33,539,598,682.94 28,930,300,519.97
equity
The accompanying notes form an integral part of these financial statements
The financial statements have been signed by:
Legal repres entative: Financial controller: Head of Accounting Department:
4
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED INCOME STATEMENT
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months ended For the six months ended
Note V
30 June 2019 30 June 2018
Operating revenue 40 25,228,147,377.43 20,778,425,602.22
Less: Operating costs 40 22,415,519,952.87 18,367,643,723.84
Tax and surcharge 41 62,139,226.44 56,620,527.25
Selling expenses 42 1,483,332,500.73 1,273,588,756.07
Administrative expenses 43 377,216,694.13 351,820,063.78
Finance costs 44 104,095,254.24 57,541,544.32
Incl: Interest cost 169,529,472.37 83,356,367.18
Interest income 60,630,036.91 23,082,233.56
Add: Other incomes 45 14,990,919.02 11,330,310.02
Investment income 46 169,142,289.99 162,693,771.35
Incl: Investment income from
associates 169,142,289.99 162,662,271.35
Impair ment loss on financial assets 47 (11,434,101.13) 1,026,702.24
Impair ment losses 48
(125,554.34) (508,849.26)
Gain on disposal of assets 49 (29,725.44) 4,281,164.61
Operating profits 958,387,577.12 850,034,085.92
Add: Non-operating income 50 3,667,170.25 5,498,951.11
Less: Non-operating expenses 51 1,718,265.56 1,797,292.80
Total profit 960,336,481.81 853,735,744.23
Less: Income taxes 52 192,243,926.50 164,486,734.32
Net profit 768,092,555.31 689,249,009.91
Net Profit from continuing operations 768,092,555.31 689,249,009.91
Net profit attributable to shareholders of the parent 650,833,360.40 641,727,034.93
Profit or loss of non-controlling interests 117,259,194.91 47,521,974.98
Total comprehensive income 768,092,555.31 689,249,009.91
Incl: Total comprehensive income for the year
attributable to owners of the parent 650,833,360.40 641,727,034.93
117,259,194.91 47,521,974.98
Total comprehensive income for the year
attributable to non-controlling interests
Earnings per share
Basic earnings per share 1.52 1.50
Diluted earnings per share 1.52 1.50
The accompanying notes form an integral part of these financial statements
5
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months ended Shareholders’ equity attributable to shareholders of the parent Non-controlling Total equity
30 June 2019 interests
Other equity
Share capital instrument Capital surplus Surplus reserve Retained earnings Subtotal
Closing balance of the preceding year 428,126,983.00 - 4,320,984,981.51 214,063,491.50 6,655,257,147.27 11,618,432,603.28 2,287,343,889.77 13,905,776,493.05
others - - - - - - - -
Opening balance of the current year 428,126,983.00 - 4,320,984,981.51 214,063,491.50 6,655,257,147.27 11,618,432,603.28 2,287,343,889.77 13,905,776,493.05
Movements in the current year - - 42,424,747.00 - 479,582,567.20 522,007,314.20 130,712,436.01 652,719,750.21
(1) Total comprehensiv e income - - - - 650,833,360.40 650,833,360.40 117,259,194.91 768,092,555.31
(2) Capital paid and reduced by
owners - - 42,424,747.00 - - 42,424,747.00 14,780,000.00 57,204,747.00
1.Capit al injection by owners - - - - - - 14,780,000.00 14,780,000.00
2.Others - - 42,424,747.00 - - 42,424,747.00 - 42,424,747.00
(3) Profit distribution - - - - (171,250,793.20) (171,250,793.20) (1,326,758.90) (172,577,552.10)
1.Dis tribution to equity owners - - - - (171,250,793.20) (171,250,793.20) (1,326,758.90) (172,577,552.10)
2.Others - - - - - - - -
12,140,439,917.48 2,418,056,325.78 14,558,496,243.26
Closing balance of the current year 428,126,983.00 - 4,363,409,728.51 214,063,491.50 7,134,839,714.47
The accompanying notes form an integral part of these financial statements
6
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months ended Shareholders’ equity attributable to shareholders of the parent Non-controlling Total equity
30 June 2018 interests
Other equity
Share capital instrument Capital surplus Surplus reserve Retained earnings Subtotal
Closing balance of the preceding year 428,126,983.00 - 3,181,429,064.99 214,063,491.50 5,572,952,806.39 9,396,572,345.88 530,930,411.26 9,927,502,757.14
others - - - - - - - -
Opening balance of the current year 428,126,983.00 - 3,181,429,064.99 214,063,491.50 5,572,952,806.39 9,396,572,345.88 530,930,411.26 9,927,502,757.14
Movements in the current year - - 397,342.21 - 513,288,940.03 513,686,282.24 37,434,714.46 551,120,996.70
(1) Total comprehensiv e income - - - - 641,727,034.93 641,727,034.93 47,521,974.98 689,249,009.91
(2) Capital paid and reduced by
owners - - 397,342.21 - - 397,342.21 26,721,512.76 27,118,854.97
1.Capit al injection by owners - - - - - - 24,381,200.00 24,381,200.00
2.Others - - 397,342.21 - - 397,342.21 2,340,312.76 2,737,654.97
(3) Profit distribution - - - - (128,438,094.90) (128,438,094.90) (36,808,773.28) (165,246,868.18)
1.Dis tribution to equity owners - - - - (128,438,094.90) (128,438,094.90) (36,808,773.28) (165,246,868.18)
2.Others - - - - - - - -
Closing balance of the current year 428,126,983.00 - 3,181,826,407.20 214,063,491.50 6,086,241,746.42 9,910,258,628.12 568,365,125.72 10,478,623,753.84
The accompanying notes form an integral part of these financial statements
7
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months ended For the six months ended
Note V
30 June 2019 30 June 2018
1.CASH FLOWS FROM OPERATING ACTIVITIES
Cash receiv ed from sales of good or rendering of
services 25,674,088,675.82 22,055,082,715.59
Tax refunds 2,721,287.63 1,593,193.21
Cash receipts related to other operating activ ities 53 295,482,211.20 311,984,787.60
Sub-total of cash inflows from operating activ ities 25,972,292,174.65 22,368,660,696.40
Cash paid for goods and services 22,598,237,854.68 19,799,894,631.80
Cash paid to and on behalf of employees 1,088,230,430.51 956,322,585.28
Cash paid for all types of taxes 627,174,776.80 548,616,793.36
Cash payments related to other operating
activities 53 494,891,531.31 838,468,976.76
Sub-total of cash outflows from operating
activities 24,808,534,593.30 22,143,302,987.20
Net cash flows from operating activities 54 1,163,757,581.35 225,357,709.20
2.CASH FLOWS FROM INV ESTING ACTIVITIES
Cash receiv ed from returns on investments 20,129,463.78 78,825,446.85
Net cash received from disposal of fix ed assets,
intangible assets and other long-term assets 801,205.52 6,064,099.87
Cash receipts related to other investing activities 53 - 48,766,145.15
Sub-total of cash inflows from investing activities 20,930,669.30 133,655,691.87
The accompanying notes form an integral part of these financial statements
8
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED CASH FLOW STATEMENT (Continued)
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months For the six months
Note V ended 30 June ended 30 June
2019 2018
2.CASH FLOWS FROM INV ESTING ACTIVITIES( Continued)
Cash paid for acquis ition of fix ed assets,
intangible assets and other long-term assets 111,399,813.51 97,867,494.61
Cash paid for acquis ition of investments 43,674,685.30 10,000,000.00
Cash payments related to other investing activities 53 1,093,125.00 43,999,800.00
Sub-total of cash outflows from investing activities 156,167,623.81 151,867,294.61
Net cash flows from investing activities (135,236,954.51) (18,211,602.74)
3.CASH FLOWS FROM FINANCING ACTIVITIES
Cash proceeds from investments by others 14,780,000.00 11,781,200.00
Incl: Cash received from capital contributions from
non-controlling shareholders of 14,780,000.00 11,781,200.00
subsidiaries
Cash receiv ed from borrowings 16,700,000.00 40,775,440.04
Cash receipts related to other financing activ ities 53 3,512,659.71 83,745,164.60
Sub-total of cash inflows from financing activities 34,992,659.71 136,301,804.64
Cash repayments for debts 73,261,634.53 79,670,200.30
Cash payments for distribution of dividends or profit
343,055,058.89 226,149,759.15
and interest expenses
Incl: Profit and dividends paid to non-controlling
1,326,758.90 40,392,215.98
shareholders of subsidiaries
Cash payments related to other financing activities 53 510,162,167.74 118,725,719.23
Sub-total of cash outflows from financing activities 926,478,861.16 424,545,678.68
Net cash flows from financing activ ities (891,486,201.45) (288,243,874.04)
The accompanying notes form an integral part of these financial statements
9
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED CASH FLOW STATEMENT (Continued)
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
Note V For the six months For the six months
ended 30 June 2019 ended 30 June 2018
4.EFFECT OF FOREIGN EXCHANGE RATE CHANGES
ON CASH AND CASH EQUIVALENTS (176,567.25) 314,863.47
5.NET INCREASE IN CASH AND CASH EQUIVALENTS 54 136,857,858.14 (80,782,904.11)
Add: Cash and cash equivalents at beginning of the
year 7,632,117,020.77 3,673,498,691.48
6.CASH AND CASH EQUIVALENTS AT END OF YEAR 54
7,768,974,878.91 3,592,715,787.37
The accompanying notes form an integral part of these financial statements
10
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET
As at 30 June 2019
(Expressed in Renminbi Yuan)
ASSETS Note XIV 30 June 2019 31 December 2018
Current assets
Cash and bank balances 2,210,653,256.99 1,817,654,598.01
Notes receivable 70,539,252.94 63,870,980.39
Accounts receivable 1 610,075,622.91 631,236,593.94
Ad vances to suppliers 3,875,346.87 4,760,182.00
Other receivables 2 1,858,484,572.60 1,541,980,883.50
Incl:Interest receivable 14,926,690.76 7,550,877.07
Dividends receivable 106,074,898.00 -
Inventories 225,040,528.88 158,166,185.65
Other current assets 39,482.38 39,482.38
Total current assets 4,978,708,063.57 4,217,708,905.87
Non-current assets
Long-term equity investments 3 7,639,715,544.55 7,432,906,692.24
Other non-current financial assets 140,000,000.00 140,000,000.00
Investment properties 1,635,946.12 1,955,854.46
Fixed assets 19,952,922.05 21,362,422.03
Right-of-use assets 6,316,333.03 -
Intangible assets 2,997,883.63 2,452,222.51
Long-term deferred expenses 6,990,428.04 7,481,809.53
Other non-current assets 7,000,000.00 7,000,000.00
Total non-current assets 7,824,609,057.42 7,613,159,000.77
Total assets 12,803,317,120.99 11,830,867,906.64
The accompanying notes form an integral part of these financial statements
11
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET (Continued)
As at 30 June 2019
(Expressed in Renminbi Yuan)
LIABILITIES 30 June 2019 31 December 2018
Current liabilities
Short-term borrowings 570,000,000.00 539,000,000.00
Notes payable 321,344,616.65 252,317,800.78
Accounts payable 547,918,074.90 442,049,241.22
Contract liabilities 9,058,538.51 4,182,083.40
Employee benefits payable 34,702,315.82 36,233,563.12
Tax pa yables 11,430,926.20 13,426,601.90
Other payables 1,729,610,132.84 1,481,817,856.56
Incl:Interest payable 5,588,978.10 1,354,592.35
Non-current liabilities due within one
year 32,452,757.27 -
Other current liabilities 208,701.01 226,427.99
Total current liabilities 3,256,726,063.20 2,769,253,574.97
Non-current liabilities
Long-term borrowings - 31,600,000.00
Lease liabilities 5,584,622.27 -
Long-term payables 800,000.00 800,000.00
Long-term employee benefits payable 102,000.00 118,000.00
Deferred income 1,508,786.84 1,687,899.50
Deferred tax liabilities 1,635,298.63 2,298,426.39
Total non-current liabilities 9,630,707.74 36,504,325.89
Total liabilities 3,266,356,770.94 2,805,757,900.86
The accompanying notes form an integral part of these financial statements
12
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET (Continued)
As at 30 June 2019
(Expressed in Renminbi Yuan)
SHAREHOLDERS’ EQUITY 30 June 2019 31 December 2018
Shareholders’ equity
Share capital 428,126,983.00 428,126,983.00
Capital surplus 4,468,787,524.26 4,426,362,777.26
Surplus reserves 214,063,491.50 214,063,491.50
Retained earnings 4,425,982,351.29 3,956,556,754.02
Total shareholders’ equity 9,536,960,350.05 9,025,110,005.78
12,803,317,120.99 11,830,867,906.64
Total liabilities and shareholders’ equity
The accompanying notes form an integral part of these financial statements
13
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY INCOME STATEMENT
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
Note XIV For the six months For the six months
ended 30 June 2019 ended 30 June 2018
Operating revenue 4 2,008,004,563.30 1,687,621,355.83
Less: Operating costs 4 1,921,272,394.76 1,614,717,473.91
Tax and surcharge 2,519,247.99 2,016,368.93
Selling expenses 31,052,044.81 25,894,795.45
Administrative expenses 38,056,806.31 33,679,106.75
Finance costs (28,398,244.00) (19,369,880.08)
Incl: Interest cost 23,271,307.72 20,770,113.43
Interest income 52,479,722.42 40,925,200.74
Add: Other incomes 332,764.13 1,299,345.14
Investment income 5 608,288,420.47 534,840,744.46
Incl: Investment income from associates 181,280,533.11 173,326,290.14
Impair ment loss on financial assets (2,365,765.08) 7,411.02
Impair ment losses (102,112.84) (630,953.33)
Gain on disposal of assets (26,074.52) -
Operating profits 649,629,545.59 566,200,038.16
Add: Non-operating income 46,069.40 33.08
Less: Non-operating expenses - 127,688.63
Total profit 649,675,614.99 566,072,382.61
Less: Income taxes 8,999,224.52 6,292,873.84
Net profit 640,676,390.47 559,779,508.77
Net Profit from continuing operations 640,676,390.47 559,779,508.77
Total comprehensive income 640,676,390.47 559,779,508.77
The accompanying notes form an integral part of these financial statements
14
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months ended 30 Other equity
Share capital Capital surplus Surplus reserve Retained earnings Total equity
June 2019 instruments
Closing balance of the preceding
year 428,126,983.00 - 4,426,362,777.26 214,063,491.50 3,956,556,754.02 9,025,110,005.78
Others - - - - - -
Opening balance of the current
year 428,126,983.00 - 4,426,362,777.26 214,063,491.50 3,956,556,754.02 9,025,110,005.78
Movements in the current year - - 42,424,747.00 - 469,425,597.27 511,850,344.27
(1) Total comprehensive income - - - - 640,676,390.47 640,676,390.47
(2) Capital paid and reduced by
ow ners - - 42,424,747.00 - - 42,424,747.00
1. Capital injection by
ow ners - - - - - -
2. Others - - 42,424,747.00 - - 42,424,747.00
(3) Profit distribution - - - - （171,250,793.20） （171,250,793.20）
1. Distribution to ow ners - - - - （171,250,793.20） （171,250,793.20）
Closing balance of the current
year 428,126,983.00 - 4,468,787,524.26 214,063,491.50 4,425,982,351.29 9,536,960,350.05
The accompanying notes form an integral part of these financial statements
15
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (Continued)
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months ended 30 June Other equity
Share capital Capital surplus Surplus reserve Retained earnings Total equity
2018 instruments
Closing balance of the preceding year 428,126,983.00 - 4,407,091,484.13 214,063,491.50 3,329,412,821.48 8,378,694,780.11
Others - - - - - -
Opening balance of the current year 428,126,983.00 - 4,407,091,484.13 214,063,491.50 3,329,412,821.48 8,378,694,780.11
Movements in the current year - - 397,342.21 - 431,341,413.87 431,738,756.08
(1) Total comprehensive income - - - - 559,779,508.77 559,779,508.77
(2) Capital paid and reduced by
- - 397,342.21 - - 397,342.21
ow ners
1. Capital injection by owners - - - - - -
2. Others - - 397,342.21 - - 397,342.21
(3) Profit distribution - - - - (128,438,094.90) (128,438,094.90)
1. Distribution to ow ners - - - - (128,438,094.90) (128,438,094.90)
Closing balance of the current year 428,126,983.00 - 4,407,488,826.34 214,063,491.50 3,760,754,235.35 8,810,433,536.19
The accompanying notes form an integral part of these financial statements
16
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY CASH FLOW STATEMENT
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months For the six months
ended 30 June 2019 ended 30 June 2018
1.CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from sales of good or rendering
of services 2,136,424,520.77 1,787,065,555.60
Cash receipts related to other operating
activities 18,658,823.82 43,943,301.92
Sub-total of cash inflows from operating
activities 2,155,083,344.59 1,831,008,857.52
Cash paid for goods and services 1,905,147,658.61 1,655,107,446.18
Cash paid to and on behalf of employees 48,424,818.87 44,855,325.83
Cash paid for all types of taxes 27,913,893.13 18,706,775.51
Cash payments related to other operating
activities 17,265,038.12 36,183,479.25
Sub-total of cash outflows from operating
activities 1,998,751,408.73 1,754,853,026.77
Net cash flows from operating activities 156,331,935.86 76,155,830.75
2. CASH FLOWS FROM INV ESTING ACTIVITIES
Cash receiv ed from returns of investments 55,106,832.79 187,137,437.23
Net cash received from disposal of fix ed assets,
intangible assets and other long-term assets 119,000.00 -
Cash receipts related to other investing activities 996,340,000.00 857,940,000.00
Sub-total of cash inflows from investing activities 1,051,565,832.79 1,045,077,437.23
Cash paid for acquisition of fixed assets,
intangible assets and other long-term assets 5,983,680.11 6,044,462.78
Cash paid for investments - 10,000,000.00
Cash payments related to other investing
activities 1,200,340,000.00 1,051,642,980.00
Sub-total of cash outflows from investing
activities 1,206,323,680.11 1,067,687,442.78
Net cash flows from investing activities (154,757,847.32) (22,610,005.55)
The accompanying notes form an integral part of these financial statements
17
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY CASH FLOW STATEMENT (Continued)
For the six months ended 30 June 2019
(Expressed in Renminbi Yuan)
For the six months For the six months
ended 30 June 2019 ended 30 June 2018
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash receiv ed from borrowings 10,000,000.00 10,000,000.00
Cash receipts related to other financing 11,037,461,719.13 8,065,884,436.80
activities
Sub-total of cash inflows from financing 11,047,461,719.13 8,075,884,436.80
activities
Cash repayments for debts 10,000,000.00 10,000,000.00
Cash payments for distribution of dividends or
182,679,899.11 144,898,008.66
profit and interest expenses
Cash payments related to other financing
10,463,180,682.33 8,230,488,300.78
activities
Sub-total cash outflows from financing activ ities 10,655,860,581.44 8,385,386,309.44
Net cash flows from financing activ ities 391,601,137.69 (309,501,872.64)
4.EFFECT OF FOREIGN EXCHANGE RATE
CHANGES ON CASH AND CASH (176,567.25) 314,863.47
EQUIVALENTS
5. NET INCREASE IN CASH AND CASH
392,998,658.98 (255,641,183.97)
EQUIVALENTS
Add: Cash and cash equivalents at beginning of 1,817,654,598.01 1,776,696,342.87
the year
6. CASH AND CASH EQUIVALENTS 2,210,653,256.99 1,521,055,158.90
AT END OF YEAR
The accompanying notes form an integral part of these financial statements
183
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
I Profile of the Company
(1) Historical development and basic information
As approved by the People’s Government of Shenzhen (SFBF (1993) No.356), China National Accord
Medicines Corporation Lt d. (hereinafter referred to as the “t he Company”), formerly known as S henz hen
Healt h Mineral Water Corp., Ltd., was registered as a joint stock liability limited company on 1 February
1993 through stock transformation. In March 1993, with the approval from the Shenzhen Branch of the
People’s Bank of China, the Company issued 30 million A shares (including 16.5 million public shares,
3.5 million employee shares and 10 million corporation shares ) and 20 million B shares. After this
issuance, the Company’s share capital was RMB105 million. Through convert capital surplus into share
capital, bonus issues and issuance of shares for years, the share capital of the Company increased to
RMB428,126,983 as at 30 June 2019.
In November 2000, the Company entered into an Assets Exchange Agreement with S henz hen
Investment Management Company, the original major shareholder of the Company, to exchange all the
assets and liabilities of the Company as of 31 August 2000 for Shenz hen Investment Managemen t
Company’s 100% equity interests in 11 pharmaceutical companies and certain properties as well as 51%
equity interests in Shenz hen Tefa Modern Computer Co., Ltd. The above assets exchange proposal was
approved by shareholders in the Second Extraordinary General Meeting on December 29, 2000. The
transaction was complet ed on 8 January 2001.
On 18 February 2004, the Company’s original major shareholder, Shenzhen Investment Management
Company, ent ered into a Stock Trans fer Agreement with Sinopharm Group Co., Ltd. (hereinafter referred
to as “Sinopharm Group”) to transfer its 43.33% shares in the Company to Sinopharm Group. The legal
procedures of the above equity transfer were completed on 9 December 2004. At the same time, as
approved by the State-owned Assets Supervision and Administration Commission of the State Council
(GZCQ (2004) No.525) and the China Securities Regulatory Commission (ZJGS Z (2004) No.94), the
nature of these shares was changed from state-owned stock to state-owned legal entity stock and
Sinopharm Group became the largest shareholder of the Company.
On 14 April 2006, the Company’s proposal on reformation of segregated stocks was approved. To gain
liquidity for the restricted stocks of the Company, the holders of the restricted stocks of t he Company
agreed to pay the following consideration: based on the stock registration as of 27 April 2006, the
Company issued bonus shares on 28 April 2006 at the ratio of 3 shares to every 10 A shares to
liquidated A-shareholders which went public on the same day. After this bonus issue, the total number of
shares of t he Company remained unchanged with corresponding changes in the composition of
shareholdings.
On March 14 2014, the company issued 74, 482, 543 ordinary shares (A shares) through the non -public
offering. Par value per share is RMB1 yuan. The shares shall not be transferred within 36 months since
the issued day. The total number of shares of the Company was 362,631,943 since the dat e of issue.
20
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
I Profile of the Company (Continued)
(1) Historical development and basic information (Continued)
As of 31 October 2016, the company issued RMB 65,495,040.00 ordinary shares (A shares) through the
non-public offering. Par value per share is RMB1 yuan. Through the non-public offering, the Company
acquired the companies under common cont rol, including Sinopharm Holding Guoda Pharmacy Co.,
Ltd. (“Guoda Pharmacy”), Foshan Nanhai Medicine Group Co., Ltd.(“Foshan Nanhai”),Guangdong
South Pharmaceutical Foreign Trade Co., Ltd. (“South Pharma & Trade), Guangdong Dong Fang
Uptodate & Special Medicines Co., Ltd. (“ Guangdong Uptodat e & Special Medicines”) by issuing
shares and raised supporting funds by issuing shares to Ping An Asset Management Co., Ltd.(“Ping A n
Asset Management”) to ac quire non-controlling interest of South Pharma & Trade. The relevant shares
were successfully issued and listed on 5 January 2017.
As of 30 June 2019, the total share capital was RMB428,126,983.
The Company is registered with Shenzhen Administration for Industry & Commerc e. Its Uniform Social
Credit Code is 91440300192186267U. The operation period of the Company is from 2 August 1986 to
the long term. The registered capital of the Company is RMB428,126,983. The legal representative of
the Company is Lin Zhaoxiong.
The approved scope of business of the Company and its subsidiaries (together “the Group”) includes:
the wholes ale of traditional Chinese medicine preparations, bulk pharmac eutical drugs, chemical
preparations, bulk antibiotic drugs, antibiotic preparations, biochemical drugs, biological products
(including vaccines and in vit ro diagnostic reagents psychotropic drugs and preparations, narcotic drugs,
toxic drugs for medical use, protein assimilation preparation and peptide hormones; trade of diet ary
supplement; research, development and consultation services of pharmaceutical packaging materials
and pharmaceutical industry products; industrial investment holding; domestic trade; material supply
and marketing industry (other than special licensing); sale of ambulances; trade of second -class and
third- class medical equipment; project investment; property management and lease of self-owned
properties; pharmacovigilance and medical information consulting; parking operation; logistics and
related services; package agency business; logistic design; import and export services (excluding
projects that are prohibit ed by the country; limited projects has to be approved before operating).
21
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
I Profile of the Company (Continued)
(2) The Group’s parent and ultimate parent company is Sinopharm Group and China National
Pharmaceutical Group Corporation respectively.
(3) These financial statements were authorized for issue by the board of directors of the Company
on 22 August 2019.
(4) Subsidiaries consolidated in the financial statements for the current peri od and change in the
consolidation scope are shown in Note V I.
II Basi s of preparation
The financial statements were prepared in accordance wit h the Basic Standard and specific standards
of the Accounting Standards for Business Enterprises issued by the Ministry of Financ e on 15 February
2006 and the specific accounting standards and the relevant regulations issued thereafter (hereafter
collectively referred to as the “Accounting Standards for Business Enterprises ” or “CAS”), and the
disclosure requirem ents in the Preparation Convention of Information Disclosure by Companies
Offering Securities to the Public No.15 – General Rules on Financial Reporting issued by the China
Securities Regulatory Commission.
These financial statements are prepared on a going concern basis.
Except for certain financial instruments, the financial statements have been prepared using historical
cost as the principle of measurement. Where assets are impaired, provisions for asset impairment are
made in accordance wit h the relevant requirements.
The Group has made accounting policies and accounting estimates according to its own operation and
production characteristics, which are mainly reflected in the bad debt provision for accounts receivable
(Note Ⅲ (10)), inventory costing methods (Note Ⅲ (13)), depreciation methods for fixed assets and
amortization method for intangible assets (NoteⅢ(18), NoteⅢ(22)), judgement basis for capitalization of
development costs (NoteⅢ(22)) , impairment of long-term assets (NoteⅢ(23)), revenue recognition
(Not eⅢ(30)).
22
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policies and accounting estimates
(1) Statement of compliance with the Accounting Standards for Busine ss Enterpri se s
The financial statements of the Company for the year ended 30 June 2 019 are in compliance with
Accounting Standards for Business Enterprises, and truly and completely present the financial position
of the Group and the Company as of 30 June 2019 and the operating results, cash flows and other
information for the six months ended 30 June 2019 of the Group and the Company.
(2) Accounting year
The Company’s accounting year starts on 1 January and ends on 31 December.
(3) Functional currency
The functional currency is Renminbi (RMB).
(4) Busine ss combinations
(a) Business combinations involving entities under common control
Assets and liabilities (including goodwill arising from the ultimate c ontrolling shareholder’s acquisition of
the party being abs orbed) that are obtained by the abs orbing party in a business c ombination shall be
measured at their carrying amounts at the combination date as recorded by the party being absorbed.
The difference between the carrying amount of the net assets obtained and the carrying amount of the
consideration paid for the combination (or the aggregate face value of shares issued as consideration)
shall be adjusted to share premium under capital surplus. If the capital surplus is not sufficient to absorb
the difference, any excess shall be adjusted against retained earnings. The t rans action costs of issuing
equity securities or debt securities for a business combination are recognized at the initial recognition
amount of equity securities or debt securities.
(b) Business combinations involving enterprises not under common control
The cost of combination and identifiable net assets obtained by the acquirer in a business combination
are measured at fair value at the acquisition date. Where the cost of the combination exceeds the
acquirer’s interest in the fair value of the acquirer’s identifiable net assets, the difference is recognized
as goodwill; where the cost of combination is lower than the acquirer’s interest in the fair value of the
acquirer’s identifiable net assets, the difference is recognized in profit or loss for the cur rent period.
Costs directly attributable to the combination are included in profit or loss in the period in which they are
incurred. Transaction costs associated with the issue of equity or debt securities for the business
combination are included in the initially recognized amounts of the equity or debt securities.Where the
business combination not involving ent erprises under common control which is achieved in stages, the
acquirer’s previously held equity interests in the acquiree are remeasured at the fair value on the
acquisition date, with the difference bet ween the fair value and carrying amount recognized as
investment income for the current period.
23
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(4) Busine ss combinations (Continued)
(b) Business combinations involving enterprises not under common control (Continued)
If the acquirer’s previously held equity interests of the acquiree involve other comprehensive income
(“OCI”) under the equity method, the accounting t reatment is conducted on the same basis as would
have been required if the investee had directly disposed of the related assets or liabilities, and the
changes in shareholders’ equity other than net profit or loss, OCI and profit distributions are cha rged to
profit or loss for the current period on the ac quisition date. For financial assets at fair value through OCI
held before the acquisition date, changes in fair value that was accumulated through OCI will trans fer to
retained earnings.
(5) Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Company and all of its
subsidiaries.
Subsidiaries are cons olidated from the date on which the Group obtains control and are de -
consolidated from the date that such control ceases. For a subsidiary that is acquired in a business
combination involving enterprises under common control, it is included in the consolidated financial
statements from the date when it, together with the Company , comes under common control of the
ultimate controlling party. The portion of the net profits realized before t he combination date is
presented separately in the consolidated income statement.
In preparing the consolidated financial statements, where the accounting policies and the accounting
periods of the Company and subsidiaries are inconsistent, the financial statements of the subsidiaries
are adjusted in accordance with the accounting policies and the accounting period of the Company. For
subsidiaries acquired from business combinations involving enterpris es not under common cont rol, the
individual financial statements of the subsidiaries are adjusted based on t he fair value of the identifiable
net assets at the acquisition date.
All significant intra-group balances, transactions and unrealized profits are eliminated in the
consolidated financial statements. The portion of a subsidiary’s equity and the portion of a subsidiary’s
net profits, losses and comprehensive income for the period not attribut able t o the Company are
recognized as non-cont rolling interests and presented separately in the consolidated financial
statements within equity, net profits and total comprehensive income, respectively. The unrealized gain
or loss from selling assets to subsidiaries fully offs ets the net income attributable to equity holders of the
Company. The unrealized gain or loss from purchasing assets from subsidiaries offsets the net income
attributable to equity holders of the Company and attributable to the non-controlling interest by the
distribution proportion regarding t he Company and the subsidiary. The unrealized gain or loss from a
transaction between subsidiaries offsets the net income attributable to equity holders of the Company
and attributable to t he non-controlling interest by the distribution proportion regarding the Company and
the selling side of the subsidiaries. If different recognition perspectives for the same t ransaction arise
within different accounting identities which are set up, there is an adjustment for the transaction from
the Group’s perspective.
24
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(5) Preparation of consolidated financial statements (Continued)
When the Group loses control of a subsidiary in multiple transactions in which it dispos es of its long-
term equity investment in the subsidiary in stages, if each of the multiple transactions does not form part
of a bundled transaction, the transactions conducted before the loss of control of the subsidiary are
accounted for in accordance with the accounting policy for partial disposal of the equity investment in
subsidiaries where control is retained. If each of the multiple transactions forms part of a bundled
transaction which eventually results in the loss of control in the subsidiary, these multiple transactions
are accounted for as a single transaction. In the consolidated financial statements, the differenc e
between the consideration received and the corresponding proportion of the subsidiary’s net assets
(calculated continuously from the acquisition date) in eac h transaction prior to the loss of cont rol shall
be recognized in other comprehensive income and transferred to profit or loss when the parent
eventually loses control of the subsidiary.
(6) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on demand, and
short-term and highly liquid investments that are readily convertible to known amounts of cash and are
subject to an insignificant risk of changes in value.
(7) Foreign currency translation
Foreign currency transactions are translated into RMB using the exchange rates prevailing at the dates
of the transactions.
At the balance sheet date, monetary items denominated in foreign currencies are translat ed into RMB
using the s pot exchange rates on the balance sheet date. Exchange differences arising from these
translations are recognized in profit or loss for the current period, except for t hose attributable to for eign
currency borrowings that have been taken out specifically for the acquisition or construction of
qualifying assets, which are capitalized as part of the cost of those assets. Non-monetary items
denominated in foreign currencies that are measured at historical cost are translated at the balance
sheet date using the spot exchange rates at the dates of the transactions. The effect of exchange rate
changes on cash is presented separately in the cash flow statement.
(8) Financial instruments
Financial instruments are the cont racts that formed the financial assets of one entity, and at the same
time formed the financial liabilities or equity instruments of other entities.
Recognition and derecognition of financial instruments
Financial assets and financial liabilities are recognised when the Group becomes a party to the
contractual provisions of the instrument.
25
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(8) Financial instruments (Continued)
Recognition and derecognition of financial instruments (Continued)
The Group derecognises a financial asset, part of a financial asset or group of financial assets, i.e.,
offset from the accounts and statement of financial position, if either of the follo wing conditions is
satisfied:
(i) The contractual rights to the cash flows from the financial asset expire; or
(ii) The contractual rights to the cash flows from the financial asset are trans ferred out, or obligated
to trans fer out all generated cash flows on receipt; and (a) s ubstantially all the risks and
rewards of ownership of the financial asset are trans ferred to the t rans feree; or (b) the Group
neither transfers nor retains substantially all the risks and rewards of ownership of the financial
asset, but has not retained cont rol of the financial asset.
The Group derecognises a financial liability only when the underlying present obligation is settled,
discharged or expired. An agreement to replace the original financial liability with a new financia l liability
with substantially different terms, or to modify the original financial liability’s terms substantially, is
accounted for as an extinguishment of the original financial liability and the recognition of a new
financial liability. The difference between the carrying amount of the financial liability Derecognized and
the new financial liability should be recognised in profit or loss for the current period.
All regular means of purchases or sales of financial assets are recognised and Derecognized on a trade
date basis. Regular means of purchases or sales are purchases or sales of financial assets that require
delivery of assets within the period generally established by regulation or convention in the marketplace.
Trade dat e is the date that the Group commits to purchas e or sell the financial asset.
Classification and measurement of financial assets
At initial recognition, the Group classifies its financial assets into: financial assets at fair value through
profit or loss, financial assets at amo rtised cost, or financial assets at fair value through other
comprehensive income, according to the Group’s business model for managing financial assets and the
contract cash flow characteristics of the financial assets. Financial assets are measured at fa ir value at
initial recognition, provided that trade receivables or bills receivable not containing significant financing
components or for which financing components of not more than 1 year are not taken into consideration
shall be measured at their transaction prices at initial recognition.
For financial assets at fair value through profit or loss, the relevant transaction costs are directly
recognised in profit or loss; for other financial assets, the relevant transaction costs are recognised in
their initial recognition amount.
26
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(8) Financial instruments (Continued)
Classification and measurement of financial assets (Continued)
Subsequent measurement depends on the classification of the financial assets:
Financial assets measured at amortised cost (debt instruments)
The Group measures financial assets at amortized cost if both of the following conditions are met: The
financial asset is held within a business model with the objective to hold financial assets in order to
collect contractual cash flows; The contractual terms of the financial asset give rise on specified dates
to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Interest income of this kind of financial assets is recognized using the effective interest method. Gains
and losses are recogniz ed in the income statement when the asset is derecognized, modified or
impaired. These financial assets mainly include cash and cas h equivalents, bills receivable and trade
receivables, other receivables, debt investment and long -term rec eivables. Debt investments and long -
term receivables due within one year from the balance sheet date are report ed by the Group as current
portion of non-current assets, and debt investments due within one year from the original maturity date
are reported as other current assets.
Financial assets at fair value through ot her comprehensive income (debt instruments)
The Group measures debt investments at fair value through other comprehensive income if both of the
following conditions are met: The financial asset is held within a business model with the objective of
both holding to collect contractual cash flows and selling; The contract ual terms of the financial asset
give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding. Changes in fair values are recognized in other comprehensive income
except that interest income, impairment losses and exchange differenc es are recognized in current
profit or loss. Upon derec ognition, the cumulative fair value change recognised in other comprehensive
income is transferred to profit or loss. Such financial assets are report ed as ot her debt investment.
Other debt investment due within one year from the balance sheet dat e is reported as a current portion
of non-current assets and other debt investment due within one year from the original maturity date is
reported as an item of other current assets.
Financial assets designated at fair value through other comprehensive income (equity investments)
The Group irrevocably chooses to designate some non -tradable equity instrument investments as
financial assets at fair value through other comprehensive income. Only relevant dividend income
(excluding dividend income explicitly recovered as part of investment cost) is recognized in profit or loss,
and subsequent changes in fair value are included in other comprehensive income without provisi on for
impairment. When financial assets are derecognized, the accumulated gains or losses previously
recognized in other comprehensive gains are trans ferred from other comprehensive income and
recognized in retained earnings. Such financial assets are reported as other equity investment.
If one of the following conditions is met, it is a held-for-trading financial asset: the acquisition of the
relevant financial asset is intended primarily for sale or repurchase in the near future; it is a part of the
port folio of identifiable financial instruments under centralized management, and there is objective
evidence that the short-term profit model is adopted in the near future; it is a derivative, except for a
derivative that is designated as a valid hedging instrument, other than a derivative that complies with a
financial guarantee contract.
27
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(8) Financial instruments (Continued)
Classification and measurement of financial assets (Continued)
Financial assets at fair value through profit or loss
Financial assets other than the above-mentioned financial assets at amortised cost and financial assets
at fair value t hrough other comprehensive income are classified as financ ial assets at fair value t hrough
profit or loss. For such financial assets, fair value is used for subsequent measurement, and all changes
in fair value are recognised in profit or loss. Such financial assets are pres ented as held -for-trading
financial assets and are presented as other non -current financial assets if they expire after more than
one year from the balance sheet date or expected to be held more than one year from the balance
sheet date.
Only when an accounting mismatch is eliminated or signi ficantly decreas ed, financial assets are
designated as financial assets at fair value through profit or loss at initial recognition.
When an enterprise initially designates a financial asset as a financial asset at fair value through profit
or loss, it cannot be reclassified to other financial assets; other financial assets cannot be re-designated
after initial recognition as financial assets measured at fair value through profit or loss.
When and only when the Group changes its business model of managing financial assets, it reclassifies
all relevant financial assets affected.
Classification and measurement of financial liabilities
On initial recognition of financial liabilities of the Group are classified as financial liabilities at fair value
through profit or loss, other financial liabilities and derivatives designated as effective hedging
instruments. For financial liabilities at fair value through profit or loss, the relevant transaction costs are
directly recognized in profit or loss, and the related transaction costs of ot her financial liabilities are
recognized in their initial amount.
Subsequent measurement of financial liabilities is determined by its classification:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss consist of held for trading financial liabilities
(including derivatives belonging to financial liabilities) and financial liabilities designated on initial
recognition as financial liabilities at fair value through profit or loss.
Financial liabilities are held-for-trading financial liabilities if one of the following conditions are met: the
purpose of assuming related financial liabilities is mainly to sell or repurchase in t he near future; they
are part of a centrally managed identifiable portfolio of financial instruments, and there is objective
evidence that enterprises have adopted a short-term profitability model in the near future; they are
derivatives, excluding derivatives that are designat ed as effective h edging instruments and derivatives
that meet the financial guarantee contract. Held-for-trading financial liabilities (including derivatives
belonging to financial liabilities) are subs equently measured at fair value. Except for hedging accounting,
all changes in fair value are recognized in profit or loss.
28
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(8) Financial instruments (Continued)
Classification and measurement of financial liabilities (Continued)
Only if one of the following conditions is met can financial liabilities be designated as financial liabilities
at fair value through profit or loss on initial recognition: (1) It can eliminate or significantly reduce the
accounting mismatch. (2) The formal written document of risk management or investment strategy has
stated that the port folio of financial instruments is managed, evaluated and reported to key managers
on the basis of fair value. (3) The financial liability is a hybrid instrument that contai ns one or more
embedded derivatives, unless the embedded derivatives have no signific ant change in the cash flows of
the hybrid instrument, or the embedded derivatives should obviously not be separated from the related
hybrid instruments. (4) Mixed instruments contain embedded derivatives that need to be split but cannot
be meas ured separately at the time of acquisition or on subsequent balance sheet days.
For such financial liabilities, subsequent measurements are made at fair value. Changes in fair value
caused by changes in the Group’s own credit risk are recognized in other comprehensive income, while
other changes in fair value are recognized in profit or loss. Unless changes in fair value caused by
changes in the Group's own credit risk recognized in other comprehensive income may result in or
expand accounting mismatches in profit or loss, the Group shall recognize all changes in fair value
(including the amount of impact of changes in its own credit risk) in profit or loss.When an enterprise
designates a financial liability as a financial liability at fair value through profit or loss, it cannot be
reclassified as other financial liabilities; nor can other financial liabilities be re-designated as financial
liabilities at fair value through profit or loss after initial rec ognition.
Other financial liabilities
For such financial liabilities, subsequent meas urement is made at amortized cost using the effective
interest rate method.
Impairment of financial assets
Based on expected credit losses, the Group undertakes impairment treatment and confirms loss
provisions of financial assets at amortized cost, debt instrument investments at fair value through other
comprehensive income and financial guarantee contracts.
Credit loss refers to the difference bet ween the cash flows of all contracts discounted at the original
effective interest rate and the expected cash flows of all contracts receivable, i.e. the present value of
all cash shortages. Among them, the financial assets purchased by or originat ed from the Group to
which credit impairment has occurred shall be discounted at the effective int erest rate adjusted by the
credit of the financial assets.
For trade receivables and contractual assets that do not contain significant financing components, the
Group uses a simplified measurement method to measure loss provisions in accordanc e with the
amount of ex pected credit losses equivalent to the entire life cycle.
29
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(8) Financial instruments (Continued)
Impairment of financial assets (Continued)
For trade receivables and contractual assets with significant financing components, the Group us es a
simplified measurement method to measure loss provisions in accordance with the amount of the
expected credit loss equivalent to the entire lifetime.
For financial assets other than those measured with simplified valuation methods, the Group evaluates
at each balance sheet date whet her its credit risk has significantly increased since initial recognition.
The period during which credit risk has not significantly increased since initial recognition is considered
the first stage, at which the Group shall meas ure the loss provision based on the amount of the
expected credit loss for the next 12 months and shall compute interest income according to the book
balance and effective interest rate; the period during which credit risk has significantly increas ed since
initial recognition although no credit impairment has occurred is considered the second stage, at which
the Group shall measure the loss provision based on the amount of the expected credit loss for the
entire valid period and shall comput e interest income according to the book balanc e and effective
interest rate; The period during which credit impairment has occurred after initial recognition is
considered the third stage, at whic h the Group shall measure the loss provision based on the amount of
the expected credit loss for the entire period and shall compute interest income according to the
amortised cost and effective interest rate. For financial instruments with relatively low credit risk at the
balance sheet date, the Group assumes that its credit risk has not significantly increases since initial
recognition.
The Group evaluates the expected credit losses of financial instruments on a single and combined
basis. Taking into account the credit risk characteristics of different customers, the Group evaluates the
expected credit losses of trade rec eivables based on the agi ng port folio.
In assessing expected credit losses, the Group takes into account reasonable and valid information on
past events, current conditions and future economic forecasts.
Refer to Notes VIII.3 for the disclosure of the Group's criteria for judging the significant increase in
credit risk, the definition of assets with impaired credit losses, and the assumption of measuring
expected credit losses.
When the Group no longer reasonably expects to be able to recover all or part of the contract cash
flows of the financial assets, the Group will write off the book value of the financial assets directly.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the statement of
financial position if there is a currently enforc eable legal right to offset the recognised amounts and
there is an intention to s ettle on a net basis, or to realize the financial assets and settle the financial
liabilities simultaneously.
30
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(8) Financial instruments (Continued)
Modification of financial assets
Where the Group modifies or renegotiates the cont ract with its counterparty and does not result in the
derecognition of financial assets, but results in a change in the cash flow of the cont ract, the Group
recalculat es the book value of the financial asset on the basis of the renegotiated or modified contract
cash flows at the discounted value of the original effective interest rat e (or credit-adjusted effective rate
of int erest) of the financial asset, and t he related gains or losses are recognized in profit or loss. The
revis ed cost or expense of the financial assets adjust the book value of the financial assets and are
amortized within the remaining period of the modified financial assets.
Trans fer of financial assets
The Group derec ognises a financial asset when it has transferred substantially all the risks and rewards
of ownership of the financial asset to the transferee; the Group does not derec ognize those financial
assets when it retains substantially all the risks and rewards of the ownership.
If the Group neither transfers nor retains substantially all the risks and rewards of ownership of financial
assets, the related accounting treatments of such financial assets are as follows: the Group
derecognises financial assets when it retains no control on them, and associated assets and liabilities
are rec ognised at the same time. If the Group retains control of t he financial asset, it recognizes the
financial asset to the extent of its continuing involvement in the transferred financial asset and
recognizes an associated liability.
Continuing involvement that takes the form of a financial guarantee over the trans ferred asset is
measured at the lower of the original carrying amount of the asset and the financial guarantee. The
amount of the financial guarantee is the maximum amount of consideration that the Group could be
required to repay.
(9) Note s receivables
For details of the method for determining the expected c redit loss of notes receivable, please refer to
“III.8 Financial instruments - Impairment of financial instruments.”
(10) Accounts Receivable
For details of the met hod for determining the expected credit loss of accounts receivable, pleas e refer
to “III.8 Financial instruments - Impairment of financial instruments.”
(11) Accounts Receivable Financing
It includes not es receivable and accounts receivable that are measured at fair value on the bala nce
sheet date and whos e changes are included in other comprehensive income.
For details of the method for det ermining the expected credit loss of receivables financing, please refer
“III.8 Financial instruments - Impairment of financial instruments.”
31
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(12) Other receivables
For details of the method for determining the ex pected credit losses of other receivables, please refer to
“III.8 Financial instruments - Impairment of financial instruments.”
(13) Inventories
Inventories include raw materials, work in progress, finished goods, delegate proc essing supplies and
turnover materials, and are measured at the lower of cost and net realizable value.
Cost is determined on the weighted average method. The cost of finished goods and work in progress
comprises raw materials, direct labor and an allocation of systematically allocated overhead
expenditures incurred based on the normal operating capacity.
Basis for determining the net realizable values of invent ories and method for making provisions for
decline in the value of inventories
Provisions for decline in the value of inventories are determined at the excess amount of the carrying
value of the invent ories over their net realizable value. Net realizable value is determined based on the
estimated selling price in the ordinary course of business, less the estimated costs to completion and
estimated costs necessary to make the sale and related taxes.
The Group adopts the perpetual inventory system.
(14) Contract asse ts
The unconditional (namely, dependent only on the passage of time) right to receive consideration from
customers owned by the Group shall be present ed as amounts receivable. The right to rec eive
consideration following the transfer of products to customers which is dependent on factors other than
the passage of time is presented as contract assets.
(15) Assets relating to contract cost
The Group’s assets relating to contract costs include the contract acquisition costs and contract
performance costs, presented respectively under inventories, other current assets and other non -
current assets.
Where the Group expects the incremental costs for acquiring a contract to be recoverable, such
contract acquisition costs are recognised as an asset (unless the amortisation period of the asset is not
more than 1 year).
32
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(15) Assets relating to contract cost (Continued)
Costs incurred by the Group for the performance of a cont ract are recognised as an asset as contract
performance costs if they do not fall under the scope of the relevant standards for inventories, fixed
assets or intangible assets but meet all the following conditions:
(1) They are directly related to a current or anticipated contract, including direct labour, direct
materials, manufacturing expenses (or similar expenses), to be borne by customers as
specifically stipulated, and otherwise incurred solely in connection with the contract;
(2) they will increas e the resources to be utilised in the Company’s future performance of its
contractual obligations; and
(3) they are expected to be recoverable.
The Group amortises assets relating contract costs on the same basis as that for the rec ognition of
revenue relating to such assets and recognises the amortised assets in current profit or loss.
For assets relating to contract costs whose carrying value is higher than the difference between the
following two items, the Group makes provision for impairment for the excess to be recognis ed as asset
impairment losses:
(1) The remaining consideration expected to be obtained as a result of the trans fer of goods
relating to such assets;
(2) Estimated costs to be incurred in connection with the transfer of relevant goods
In the event that the differenc e between (1) and (2) becomes higher than the carrying value of such
assets as a result of changes in the factors of impairment for previous periods, previous provision s for
asset impairment losses should be written back and included in current profit or loss, provided that the
carrying asset value following the write-back shall not exceed the carrying value that such assets would
have on the date of write-back were there no provision for impairment.
(16) Long-term equity inve stments
Long-term equity investments comprise the Company’s long-term equity investments in its subsidiaries,
joint ventures and associates.
Long-term equity investments are accounted for using the coast method at the time it was acquired. For
long-term equity investments acquired through a business combination involving ent erprises under
common cont rol, the investment cost shall be the absorbing party’s share of the carrying amount of
shareholders’ equity of the party being absorbed at the combination date.
Subsidiaries are the investees over which the Company is able to exercise control. Associates are the
investees that the Group has significant influence on their financial and operating policies.
33
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(16) Long-term equity inve stments (Continued)
Investments in subsidiaries are measured using the cost method in the Company’s financial statements,
and adjusted by using the equity method when preparing the consolidated financial statements.
Interests in associates are accounted for using the equity method. For long-term equity investments
acquired by way of the swap of non-monetary assets, the initial investment cost shall be determined in
accordance with “ASBE No. 7 — S wap of Non-monetary Assets.” For long-term equity investments
acquired by way of debt restructuring, the initial investment cost shall be determined in accordance with
“ASBE No. 12 — Debt Restructuring.”
(a) Determination of investment cost
For long-term equity investments acquired through a business combination: for long-term equity
investments acquired through a business combination involving enterprises under common control, the
investment cost shall be the absorbing party’s share of the carrying amount of shareholders’ equity of
the party being absorbed at the combination date; for long-term equity investments acquired through a
business combination involving enterprises not under common control, the investment cost shall be the
combination cost.
(b) Subsequent measurement and recognition of related profit or loss
For long-term equity investments accounted for using the cost method, they are measured at the initial
Investment costs, and cash dividends or profit distribution declared by the investees are recognized as
investment income in profit or loss.
For long-term equity investments accounted for using the equity method, where the initial investment
cost of a long-term equity investment exceeds the Group’s share of the fair value of the investee’s
identifiable net assets at the acquisition date, the long-term equity investment is measured at the initial
investment cost; where the initial investment cost is less than the Group’s share of the fair value of the
investee’s identifiable net assets at the acquisition date, the difference is included in profit or loss and
the cost of the long-term equity investment is adjusted upwards accordingly.
For long-term equity investments accounted for usin g the equity method, the Group recognizes the
investment income according to its share of net profit or loss of the investee. The Group discontinues to
recognize its share of net losses of an investee after the carrying amount of the long -term equity
investment together with any long-term interests that, in substance, form part of the investor’s net
investment in the investee are reduced to zero. However, if the Group has obligations for additional
losses and the criteria with res pect to the recognition of provisions under the accounting standards on
contingencies are satisfied, the Group continues to recognize the investment losses and the provisions.
For changes in shareholders’ equity of the investee ot her than those arising from its net profit or loss,
other comprehensive income, and profit distribution, the Group adjusts the book value of the investment
and records a capital surplus accordingly. The carrying amount of the investment is reduced by the
Group’s share of the profit distribution or cash dividends declared by an investee.
34
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(16) Long-term equity inve stments (Continued)
(b) Subsequent measurement and recognition of related profit or loss (Continued)
The unrealized profits or losses arising from the int ra-group transactions amongst the Group and its
investees are eliminated in proportion to the Group’s equity interests in the investees, and then based
on which the investment gains or losses are recognized. For the loss on intra-group transactions
amongst the Group and its investees attributable to asset impairment, any unrealized loss is not
eliminated.
(c) Basis for det ermining existence of cont rol, joint control or significant influence over investees
Cont rol is the power to govern the financial and operating policies of the investee so as to obtain
benefits from its operating activities. In determining whet her the Company is able to exercise control
over the investee, the effect of potential voting rights over the investee is considered, such as
convertible debts and warrants currently exercisable.
Significant influence is the power to participate in the financial and operating policy decisions of the
investee, but is not control or joint control over thos e policies.
(d) Impairment of long-term equity investments
The carrying amount of long-term equity investments in subsidiaries and associates is reduc ed to the
recoverable amount when the recoverable amount is less than the carrying amount.
(17) Investment properties
Investment properties, including land use rights that have already been leased out, buildings that are
held for the purpose of leasing, and buildings that are being constructed or developed for the purpose of
leasing in future, are meas ured initially at cost. Subsequent ex penditures incurred in relation to
investment properties are included in t he cost of investment properties when it is probable that the
associated economic benefits will flow to the Group and their costs can be reliably measured;
otherwise, the expenditures are recognized in profit or loss in the period in which they are incurred.
Estimated useful lives Estimated residual value Annual depreciation
(amortization) rates
Buildings 12-35 years 0-5% 2.71-7.92%
Land use rights 30-50 years - 2.00-3.33%
When an investment property is transferred to owner -occupied property, it is reclassified as a fixed
asset or intangible asset at the date of transfer. When an owner-occupied property is transferred out for
earning rentals or for capital appreciation, the fixed asset or intangible asset is reclassified as an
investment property at its carrying amount at the date of transfer.
The investment properties’ useful life, net residual value and depreciation (amortiz ation) method applied
are reviewed and adjusted as appropriate at the end of each year.
35
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(17) Investment properties (Continued)
An investment property is Derecognized on disposal or when the investment property is permanently
withdrawn from us e and no future economic benefits are expected from its disposal. The net amount of
proceeds from sale, transfer, retirement or damage of an investment property aft er its carrying amount
and related taxes and ex penses is recognized in profit or loss for the current period.
(18) Fixed assets
Fixed assets are recognized when it is probable that the related economic benefits will flow to the
Group and the costs can be reliably measured. Subsequent expenditures incurred for a fixed asset are
included in the cost of the fix ed asset when it is probable that the associated ec onomic benefits will flow
to the Group and the related cost can be reliably measured. The carrying amount of the replaced part is
derecognized. All the other subsequent expenditures are recognized in profit or loss in the period in
which they are incurred.
Fixed assets are initially measured at cost and the effect of any expected costs of abandoning the asset
at the end of its use is considered. The cost of a fixed asset is the aggregate cost of purc hase price,
related taxes and any directly attributable expenditure for bringing the asset to its working condition for
its intended use.
Fixed assets are depreciated using the straight-line met hod to allocate the cost of the assets to their
estimated residual values over their estimated useful lives. For the fixed assets that have been provided
for impairment loss, the related depreciation charge is prospectively determin ed based upon the
adjusted carrying amounts over their remaining useful lives.
Estimated useful lives Estimated residual value Annual depreciation
rates
Buildings 20-35 years 0-5% 2.71-5.00%
Machinery and equipment 5-14 years 3-6% 6.79-19.40%
Motor vehicles 3-10 years 0-5% 9.50-33.33%
Other equipment 3-10 years 0-5% 9.50-33.33%
Leasehold improvements within 5 years 0% 20% and
above
Fixed assets held under finance leases are depreciated under the same depreciation method as other
fixed assets. The assets are depreciated over their estimated useful lives where ownership of the
assets can be reasonably estimated to be gained whe n leas e periods end; otherwise, the leased assets
are depreciated over the shorter of the leas e terms and the estimated us eful lives of the assets.
The Group reviews the useful life, estimated net residual value of a fixed asset and the depreciation
method applied at least once at each financial year end, and adjusts for any change when necessary.
36
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(18) Fixed assets (Continued)
A fixed asset is Derecognized on disposal or when no future ec onomic benefits are expected from its
use or disposal. The amount of proc eeds from disposal on sale, transfer, retirement or damage of a
fixed asset net of its carrying amount and related taxes and expenses is recognized in profit o r loss for
the current period.
(19) Construction in progre ss
Construction in progress is measured at its actual cost. The actual cost includes various necessary
construction expenditures during the construction period, borrowing costs capitalised before it is ready
for intended use and other relevant costs.
(20) Borrowing costs
Borrowing costs refer to the interest and ot her relevant cost incurred from borrowing, whic h include loan
interest, discount or amortization of premiums, auxiliary expenses and exchange differences due to
foreign currency loans, etc.
Where the borrowing costs incurred to the Company can be directly attributable to the acquisition and
construction or production of assets eligible for capitalization, it shall be capitalized and re corded into
the costs of relevant assets. Other borrowing costs shall be recognized as expenses on the basis of the
actual amount incurred, and shall be recorded into the current profits and losses. The term “assets
eligible for capitalization” shall refer to the fixed assets, investment real estate, inventories and other
assets, of which the acquisition and construction or production may take quite a long time to get ready
for its intended use or for sale.
The borrowing costs shall not be capitalized unless they simultaneously meet the following
requirements:
(1) The asset disbursements have already incurred;
(2) The borrowing costs have already incurred; and
(3) The acquisition and construction or production activities which are necessary to prepare the
asset for its intended use or sale have already started.
When the qualified asset under acquisition and c onstruction or production is ready for the intended use
or sale, the capitalization of the borrowing costs shall be ceased. Borrowing costs incurred after the
intended use or sale shall be recorded in the current profits and losses.
During t he period of c apitalization, the capitalized amount of int erest in each accounting period shall be
calculated and determined in the ways below:
The enterprise shall calculate and determine the interest of a s pecific loan by deducting interest income
of the loan capital deposit in the bank or investment income obtained from a temporary investment.
37
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(20) Borrowing costs (Continued)
The enterprise shall calculate and determine the to-be-capitalized amount of interests on the general
borrowing by multiplying the weighted average asset disburs ement of the part of the accumulative asset
disbursements minus the general borrowing by the capitalization rate of the general borrowing used.
Where the acquisition and construction or production of a qualified asset is interrupted abnormally and
the interruption period lasts for more than 3 mont hs, the capitalization of the borrowing costs shall be
suspended. The borrowing costs incurred during such period shall be recognized as expenses, and
shall be recorded int o the profits and losses of the current period, till the acquisition and construction or
production of the asset restarts.
(21) Right-of-use assets
On the commencement date of the lease term, the lessee recognizes the right -of-use asset for the
lease (except for short-t erm leases and low-value asset leases). The right to use asset costs includes:
the initial measurement amount of the leas liability; the lease payment amount paid on or before the
start date of the lease period (if there is a lease incentive, deducting the relevant amount of the lease
incentive); The initial direct cost incurred by the lessee.
Where the lessee can reasonably determine the ownership of the leased asset at the expiration of the
lease term, the depreciation is provided within the remaining useful life of the leased asset; If it is not
reasonable to det ermine that the leasehold asset can be acquired at the expiration of the lease term,
the depreciation is provided during the period between the lease term and the remaining useful life of
the leased asset. The lessee is required to determine whether the right -of-use asset is impaired at the
same time and accounting for identified impairment losses.
(22) Intangible assets
Intangible assets are recognised and measured on initial recognition at cost only if the related economic
benefits will probably flow into the Group and their costs can be measured reliably. However, the
intangible assets acquired through a business combination not involving enterpris es under c ommon
control should be measured at fair value separately as intangible assets when their fair values can be
reliably measured.
38
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(22) Intangible assets (Continued)
The useful life of the int angible assets shall be assessed according to the estimated beneficial period
expected to generate economic benefits for the Group. An intangible asset shall be regarded as having
an indefinite us eful life when there is no foreseeable limit to the period over which the asset is expected
to generate economic benefits for the Group.
Categories Useful lives
Land use rights Between the approved useful period and the
Company’s operating period
Software 3-5 years
Trademarks 5-10 years
Technology patents 5 years
Distribution net work 20 years
Franc hising rights 10 years
Favorable leases 17-20 years
Land use rights obtained by the Group are usually accounted for as intangible assets. As for the
construction of plants, factories and other buildings of the Group, the related land use rights and other
buildings were accounted for as intangible assets and fixed assets, respectively. Purchase costs of land
use rights and buildings were allocated to intangible assets and fixed assets separately. Purchase costs
were rec ognised as cost of fixed assets, only if the separation was impractic able.
Intangible assets with a finite useful life are amortised over their estimated useful lives using the
straight-line method or other reasonable systematic methods. For an intangible asset with a finite us eful
life, the Group reviews the useful life and amortization method at least once at each financial year end,
and makes adjustments when necessary.A land use right grant ed by the government with an infinite
useful life would not be amortized. Other land use rights are amortized on the straight -line basis over
their approved useful period. If the acquisition costs of land use rights and the buildings located t hereon
cannot be reliably allocated bet ween the land use rights and the buildings, all of the acquisition costs
are recognized as fix ed assets.
The expenditure on an internal research and development project is classified into expenditure on the
research phase and expenditure on the development phase based on its nature and whether there is
material uncertainty that the research and development activities can form an intangible asset at the
end of the project.
39
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(22) Intangible assets (Continued)
Expenditure for investigation, evaluation and selection of product ion process and new drug researc hes
is recognized in profit or loss in the period in which it is incurred. Expendit ure on the designation,
measurement of the final utilization of the production process and new drugs before mass production is
capitalized only if all of the following conditions are satisfied:
development of the production process and new drugs has been fully demonstrated by the
technical team;
management has approved the budget of drug production development and new drugs;
market research analysis suggests that the products produced by the new production
technology are able to be promoted;
adequate technical, financial and other resources to complete the development and the ability
to use or sell the intangible asset;
the expenditure attributable to the intangible asset during its development phase can be reliably
measured.
Other development costs that do not meet the conditions above are recognized in profit or loss in the
period in whic h they are incurred. Development costs previously recognized as expenses are not
recognized as an asset in a subsequent period. Capitalized ex penditure on the development phase is
presented as development costs in the balance sheet and transferred to intangible asset s at the date
that the asset is ready for its intended use.
The Group classifies the expenses for internal research and development as research costs and
development costs. All research costs are charged to the current profit or loss as incurred. Expendit ure
incurred on projects to develop new products is capitalised and deferred only when the Group can
demonstrate the technical feasibility of completing the intangible asset so that it will be available for use
or sale, its intention to complet e and its ability to use or sell the asset, how the asset will generate future
economic benefits (including demonstration that the product derived from the intangible asset or the
intangible asset itself will be market able or, in the case of internal use, the usefulness of the intangible
asset as such), the availability of technical and financial resources to complete the project and procure
the use or sale of the intangible asset, and the ability to measure reliably the expenditure during the
development. Product development expenditure which does not meet these criteria is expensed when
incurred.
40
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(23) Impairment of long-term assets
Fixed assets, construction in progress, intangible assets with finite useful lives, long-term prepaid
expenses and investment properties measured using the cost model and long-term equity investments
in subsidiaries and associates are tested for impairment if there is any indication that an asse t may be
impaired at the balance sheet date. If the result of the impairment test indicates that the recoverable
amount of the asset is less than its carrying amount, a provision for impairment and an impairment loss
are recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs to sell and the present value of
the future cash flows expected to be derived from the asset. Provision for asset impairmen t is
determined and recogniz ed on the individual asset basis. If it is not possible to estimate the recoverable
amount of an individual asset, the recoverable amount of a group of assets to which the asset belongs
is determined. A group of assets is the smallest group of assets that is able t o generate independent
cash inflows.
Goodwill that is separately present ed in the financial statements, intangible assets with infinite useful
lives and capitalized development costs are tested at least annually for im pairment, irrespective of
whet her there is any indication that it may be impaired. In conducting the test, the carrying value of
goodwill is allocated to the related asset groups or groups of asset groups which are expected to benefit
from the synergies of the business combination. If t he result of the test indicat es that the recoverable
amount of an asset group or a group of asset groups, including the goodwill allocated, is lower than its
carrying amount, the corresponding impairment loss is recognized. The impairment loss is first
deducted from the carrying amount of goodwill that is allocated to the asset group or group of asset
groups, and then deducted from the carrying amount of other assets within the asset groups or groups
of asset groups in proportion to the carrying amount of ot her assets.
Once the above impairment loss is recognized, it will not be reversed for the value recovered in the
subsequent periods.
(24) Long-term prepaid expenses
Long-term prepaid expens es include the expenditure for improvements to fixed assets under operating
leases, and other expenditures that have been made but should be recognized as expenses over more
than one year in the current and subsequent periods. Long -term prepaid expenses are amortized on the
straight-line basis over the expected beneficial period and are presented at actual expenditure net of
accumulated amortization.
(25) Contract liabilities
The obligation to pass products to customers in connection with customer consideration rec eived or
receivable is presented as contract liabilities, for example, amounts received prior to the transfer of the
promised products.
Cont ract assets and contract liabilities under the same contract are present ed on a net basis after set -
off.
41
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(26) Employee benefits
Short-term employee benefits
The actual occurred short-term employee benefits are recognizes as liabilities during the accounting
period in which t he service has been rendered by the employees and as costs of assets or expenses to
whichever the employee service is attributable.
Post-employment benefits (defined contribution plans)
The employees in t he Group participate in social ins urance and unemployment insurance schemes
administrated by the local governments, and the related expenditures are recorded in cost of related
assets or profit or loss in the period when they incurred.
Post-employment benefits (defined benefit plans)
The Group operates a defined benefit pension scheme. No funds have been injected into the scheme.
The cost of benefits provided under the defined benefit scheme is calculated using the expected benefit
accrual unit approac h.
Remeasurement arising from defined benefit pension schemes, including actuarial gains or losses,
changes in the asset cap effect (deducting amounts included in net interest) and returns on scheme
assets (deducting amounts included in net interest) are instantly recognised in the balance sheet and
charged to shareholders’ equity through other comprehensive inc ome for the period during which it is
incurred. It will not be reversed to profit and loss in subsequent periods.
Previous servic e costs are recognised as current expenses when: the defined benefit scheme is
revis ed, or relevant restructuring costs or termination benefits are recognised by the Group, whichever
earlier.
Net interest is arrived at by multiplying net liabilities or net assets of defined benefits with a discount
rate. Changes in net obligations of defined benefit s are recognised as operating costs and
administration expenses in the income statement. Service costs included current services costs, past
service costs and settlement of profit or loss. Net interest included interest income from scheme assets,
interest expenses for scheme obligations and interest of the asset cap effect.
Termination benefits
The Group recognizes a liability for termination benefits and charges to profit or loss at the earlier of the
following dat es: a) when the Group can no longer withdraw from the termination plan or the redundancy
offer; and b) when the Group recognizes costs or expense for a restructuring plan which involves the
payment of termination benefits.
42
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimate s (Continued)
(26) Employee benefits (Continued)
Other long term employee benefits
Other long-term employees’ benefits provided to employees shall be recognised and measured as net
liabilities or net assets where provisions regarding post -employment benefits are applicable, provided
that changes shall be included in current profit and loss or related capital costs.
(27) Lease liability
On the commencement date of the lease term, the lessee recognizes the lease liability for the lease
(except for short-term leases and low-value asset leases). The lease liability is initially measured using
the incremental borrowing rate as the present value of the discount rate based on the lease payments
that have not been paid on the start date of the leas e term. At the same time, the lessee calculates the
interest expense of the lease liability for each period of the lease term based on the effective interest
method and recognizes it in profit or loss for the current period.
(28) Provi sions
An obligation related to a contingency shall be recognized by the Group as a provision when all of the
following conditions are satisfied, except contingent considerations and contingent liabilities assumed in
a business combination not involving enterprises under commo n control:
(1) The obligation is a present obligation of the Group;
(2) It is probable that an out flow of economic benefits from the Group will be required to settle
theobligation; and
(3) The amount of the obligation can be measured reliably.
The provisions are initially measured at the best estimate of the expenditure required to settle the
related present obligation, taking into account factors pert aining to a contingency such as the risks,
uncertainties and time value of money as a whole. The carrying amount of provisions is reviewed at the
balance sheet dat e. Where there is clear evidence that the carrying amount of a provision does not
reflect the current best estimate, the carrying amount is adjusted to the current best estimate.
For business combinations not under common control, contingent liabilities of the acquiree obtained in a
business combination shall be measured at fair value in initial recognition. After initial recognition,
subsequent measurement is conducted using the higher of the amount recognized by provisions and
the amount of initial recognition deducting the accumulated amortization amount determined by the
principles of revenue recognition.
43
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(29) Share-based payments
The share-based payments shall consist of equity-settled share-bas ed payments and cash-settled
share-based payments. The term "equity-settled share-based payment" refers to a transaction in which
the group grants shares or other equity instruments as a consideration in return for services.
The equity-settled share-based payment in return for employee services shall be measured at the fair
value of the equity instruments granted to the employees. As to an equity -settled share-based payment
in ret urn for servic es of employees, if the right may be ex ercised immediately after t he grant, the fair
value of the equity instruments shall, on the date of the grant, be included in the relevant cost or
expense and the capital reserves shall be increased accordingly. As to an equity-settled s hare-based
payment in return for employee services, if the right cannot be exercised until the vesting period comes
to an end or until the prescribed performanc e conditions are met, then on each balanc e sheet da te
within the vesting period, the Group shall make the best estimate of the number of vested equity
instruments based on the latest movement of the grant ed employee, the content of prescribed
performance and other conditions. Based on the best estimate, the services obtained in the current
period shall be included in the relevant costs or expens es and the capital res erves at the fair value of
the equity instruments on the date of the grant.
For awards that do not ultimately vest because non -market performanc e and service c onditions have
not been met, no expense is recognised. Where awards include a market or non-vesting condition, the
transactions are treated as vesting irrespective of whether t he market or non -vesting condition is
satisfied, provided that all other performance and service conditions are satisfied.
Where t he terms of an equity-settled award are modified, as a minimum an expens e is recognised as if
the terms had not been modified, if the original terms of the award are met. In addition, an expense is
recognised for any modification that increases the total fair value of the share -based payments, or is
otherwise beneficial to the employee as measured at the date of modification.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation,
and any expense not yet recognised for the award is recognised immediately. This includes any award
where non-vesting conditions wit hin the control of either the Group or the employee are not met.
However, if a new award is substituted for the cancelled award, and is designated as a replacement
award on the date that it is granted, the cancelled and new awards are treated as if they were a
modification of the original award, as described in the previous paragraph.
44
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(29) Share-based payments (Continued)
A cash-settled share-based payment shall be measured in accordance with the fair value of liability
calculated and confirmed based on the shares or other equity instruments undertaken by an ent erprise.
As to a cash-settled share-based payment instruments, if the right may be exercised immediately after
the grant, the fair value of the liability undertaken by the enterprise shall, on the date of the grant, be
included in the relevant costs or expenses, and the liabilities shall be increased accordingly. As to a
cash-settled share-based payment, if the right may not be exercised until the vesting period comes to
an end or until the specified performance conditions are met, on each balance sheet date within the
vesting period, the services obtained in the current period shall, based on t he best estimate of the
information about the exercisable right, be included in the relevant costs or expenses and the
corresponding liabilities at the fair value of the liability undertaken by the group. The group shall, on
each balance sheet date and on each account date prior to the settlement of the relevant liabilities, re -
measure the fair values of the liabilities and include the changes in the current profits and losses.
(30) Revenue recognition
The group rec ognizes revenue when it has fulfilled its obligations under the contract, i, e. when the
customer acquires control relevant goods or services. Acquiring control over the goods or services
refers to the ability to dominate the use of the goods or the portion of services and to derive almost all
the economic benefits therefrom.
Cont racts for sale of goods
The contracts for the sale of goods betw een the Group and its customer usually only contain the
performance obligations for the trans fer of goods. The Group generally recognizes revenue at the point
of trans ferring the control of goods on the basis of a combination of the following factors: the current
right to collect the goods, the trans fer of major risks and benefits in the ownership of the goods, and the
transfer of the legal ownership of the goods, the trans fer of physical assets of the goods and that the
customers have accept ed the goods.
Service Contracts
The service contracts between the Group and its customers usually consist of performance obligations
such as engineering construction management, engineering design consulting and so on. As the
Group's performance of contracts is at the same time when the customer obtains and consumes the
economic benefits of the performance of the Group, and the Group has the right to collect receivables
from the performance of cont acts that has been completed to date, the Group regards it as a contact
obligation over a period of time, except that the progress of performanc e cannot be reasonably
determined. The Group determines the progress of the performanc e of contracts in accordance with the
input method. If the progress of performance of contracts cannot be reasonably determined and the
cost incurred by the Group are expected to be compensated, the revenue is recognized on the basis of
the incurred costs until the progress of performance of contacts can be reasonably measured.
45
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(30) Revenue recognition (Continued)
Variable consideration
Cert ain contracts between the Group and its customers contain cash discounts and price guarantee
clauses whic h will give ris e to variable consideration. Where a contract contains variable consideration,
the Group determines the best estimates on the variable consideration based on expected values or the
most probable amount, provided that transaction prices including variable consid eration shall not
exceed the cumulative amount of recognised revenue upon the removal of relevant unc ertainties in
connection with which a significant reversal is highly unlikely.
Consideration payable to customers
Where consideration is payable by the G roup to a customer, such consideration payable shall be
deducted against the transaction price, and against current revenue upon the rec ognition of revenue or
the payment of (or the commitment to pay) the consideration to the customer (whichever is later), save
for consideration payable to the customer for the purpose of acquiring from the customer ot her clearly
separable products.
Return clauses
In connection with sales with a return clause, revenue is recognised according to the amount of
consideration it expects to be entitled to for the transfer to a customer when the customer acquires
control of the relevant. Amounts expected to be refunded for the return of sales are recognised as
liabilities. At the same time, the balance of t he carrying value of th e product expected to be returned
upon trans fer less expected costs for the recall of such product (including an impairment loss of the
recalled product) shall be recognised as an asset (i.e. cost of return receivables), and the net amount of
the carrying value of the transferred product upon the transfer less the aforesaid asset cost shall be
transferred to cost. At each balance sheet date, the Group reassesses the fut ure return of sales and
remeasures the above assets and liabilities.
Significant financing component
Where a contract contains a significant financing component, the Group determines transaction prices
based on amounts payable assumed to be settled in cash by customers immediately upon the
acquisition of control over the products. The differenc e between such trans action price and contract
consideration is amortised over the contract period using the effective interest rate method based on a
ratio that discounts the nominal contractual consideration to the current selling price of the products .
The Group shall not give consideration to any significant financing component in a cont ract if the gap
between the customer’s acquisition of control over the products and payment of consideration is
expected to be less than 1 year.
46
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(30) Revenue recognition (Continued)
Warranty clauses
The Group provides quality assuranc e for products sold and assets built in accordance with
contract terms and laws and regulations. The accounting treatment of quality assuranc e in the
form of warranty assuring customers products sold are in compliance with required standards is
set out in Note III.28. Where the Group provides a service warranty for a standalone service in
addition to the assurance of compliance of products with required standards, such warranty is
treated as a standalone contractual performance obligation, and a portion of the transaction
price shall be allocated to the service warranty based on a percentage of the standalone price
for the provision of product and service warranty. When assessing whether a warranty is
rendering a standalone service in addition t o providing guarantee to customers that all sold
goods are in complianc e with required standards, the Group will consider whether or not such
warranty is a statutory requirement, the term of the warranty and the nat ure of t he Group’s
undertaking to perform its obligations.
Reward points program
The Group grants reward points to customers when selling goods. Cust omers can use reward
points to redeem free or discounted goods provided by the Group. This reward points program
provides significant rights to customers, the Group consider it as an individual performance
obligation, and an apportion part of the transaction price t o reward points based on pricing of
goods or s ervices with warranty clauses. Revenue is recognised when customers obtain goods
redeemed or when reward points expire.
Principal responsible person/proxy
For goods or other assets obtained from a third party which were trans ferred later to customers,
the Group has the right to decide independently, pricing of goods. This means that the Group
has obtained control over related goods before transferring t o customers. Therefore, the Group
is the principal responsible person, and revenue is recognised based on total amount of
consideration received or rec eivable. Ot herwise, the Group is proxy, and revenue is recognised
based on expected commission. This amount should be the total amount of consideration
received or receivable net of the amount payable to other parties, or based on the fixed amount
or percentage.
(31) Government grants
A government grant is recognized when the conditions attached to it can be complied with and
the government grant can be received. For a government grant in the form of t rans fer of
monetary assets, the grant is measured at the amount received or receivable. For a
government grant in the form of trans fer of non -monetary assets, it is measured at fair value; if
the fair value is not reliably det erminable, the grant is measured at nominal amount.
47
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(31) Government grants (Continued)
Government grants related to assets refer to government assets which are granted to enterprises for
the long-t erm assets formed by acquisition, construction or in other manners. Government grants
related to income refer to government grants other than those related to assets.
Government grants related to income to be used as compensation for fut ure expenses or losses shall
be recognized as deferred income and shall be charged to the current profit or loss or be used to write
down the relevant loss, during the recognition of the relevant cost expenses or losses; or used as
compens ation for relevant expenses or losses already incurred by enterprises shall be directly charged
to the profit or loss account in the current period or used to write down the relevant cost.
The government grants related to assets shall be used to write down the book value of the relevant
assets or be recognized as deferred income. The government grants related to assets, recognized as
deferred income, shall be charged to the profit and loss reasonably and systematically in stages over
the useful lives of the relevant assets. The government grants measured at a nominal amount shall be
directly charged to the current profit or loss.
If any related asset is sold, transferred, written off or destroyed before the end of its useful life, the
balance of the undistributed deferred income shall be transferred to the current gain or loss on disposal
of the asset.
(32) Income tax
Income tax comprises current and deferred tax. Income tax is recognized as income or an expense in
profit or loss of the current period, or recognized directly in shareholders’ equity if it arises from a
business combination or relates to a transaction or event which is recognized directly in shareholders’
equity.
The Group measures a current tax asset or liability arising from the current and prior periods based on
the amount of income tax expected to be paid by the Group or returned by tax authorites calculated
according to related tax laws.
Deferred tax assets and deferred tax liabilities are calculated and rec ognized based on the differences
arising between the tax bases of assets and liabilities and their c arrying amounts (temporary
differenc es). A deferred tax asset is recognized for the deductible losses that can be carried forward to
subsequent years for deduction of t he taxable profit in accordance with the tax laws. No deferred tax
liability is recognized for a temporary difference arising from the initial recognition of goodwill. No
deferred tax asset or deferred tax liability is recognized for the temporary diffe renc es resulting from the
initial recognition of assets or liabilities due to a transaction other than a business combination, which
affects neither accounting profit nor taxable profit (or deductible loss). At the balance sheet date,
deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to apply
to the period when the asset is realized or the liability is settled.
48
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(32) Income tax (Continued)
Deferred tax assets are only recognized for deductible temporary differences, deductible losses and tax
credits to the extent that it is probable that taxable profit will be available in the future against which the
deductible temporary differences, deductible losses and tax credits can be utilized.
Deferred tax assets and liabilities are offset when:
the deferred tax es are related to the same tax payer within t he Group and the same taxation
authority; and
that tax payer has a legally enforc eable right to offset current tax assets against current tax
liabilities.
Deferred tax liabilities are recognized for temporary differenc es arising from investments in subsidiaries
and associates, except where the Group is able to c ontrol the timing of the reversal of the temporary
differenc e, and it is probable that the temporary difference will not reverse in the foreseeable future.
When it is probable that the temporary differences arising from investments in subsidiaries, and
associates will be reversed in the foreseeable fut ure and that the taxable profit will be available in the
future against whic h the temporary differences can be utilized, the corresponding deferred tax assets
are recognized.
(33) Changes in accounting policies and accounting e stimate s
Changes in accounting policies
Details and reasons for changes in Procedures for approval Notes
accounting estimates
On 7 December 2018, the Ministry of Approval by The eleventh meeting The Group implement the New Lease
Finance revised “Accounting Standard of the eighth board of directors that Standard from 1 January 2019. According to
for Enterprises No. 21 - Lease” (the held on August 22, 2019. the convergence rules of the New Lease
“New Lease Standard”). It is also Standard, it is optional to adjust the amount
required that enterprises listed both of the retained earnings and other relevant
domestically and abroad and accounts at the beginning of the year when
enterprises listed abroad and preparing the New Lease Standard is initially
financial statements in accordance w i h implemented based on the cumulative
International Financial Reporting impact of the initial implement of the New
Standards or the Accounting Standards Lease Standard without adjusting the
for Business Enterprises adopt the New information for the comparable period. This
Lease Standard from 1 January 2019. change in accounting policy will increase the
company's total assets and total liabilities,
but it is not expected to have a signific ant
impact on the ow ner's equity and net profit.
The main impact of the retroactive adjustments resulting from the above changes in accounting policies on the
financial statements are as follows:
49
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(33) Changes in accounting policies and accounting e stimate s (Continued)
Cons olidated balance sheet:
ASSETS 31 December 2018 1 January 2019 Adjustment
Current assets
Cash and bank balances 8,089,781,304.56 8,089,781,304.56
Notes receiv able 1,357,311,929.63 789,536,654.23 (567,775,275.40)
Accounts receiv able 9,336,861,647.92 9,336,861,647.92
Receivable financing - 567,775,275.40 567,775,275.40
Advances to suppliers 583,484,515.95 419,443,944.83 (164,040,571.12)
Other receivables 643,493,359.32 643,493,359.32
Incl:Interest receivable 8,223,327.64 8,223,327.64
Inventories 4,389,335,942.19 4,389,335,942.19
Other current assets 95,347,629.18 95,347,629.18
Total current assets 24,495,616,328.75 24,331,575,757.63 (164,040,571.12)
Non-current assets
Long-term equity investments 1,880,393,786.10 1,880,393,786.10
Other equity instruments 13,685,760.00 13,685,760.00
investment
Other non-current financial assets 140,000,000.00 140,000,000.00
Investment properties 144,894,495.97 144,894,495.97
Fixed assets 607,933,827.67 594,067,973.91 (13,865,853.76)
Construction in progress 36,412,614.61 36,412,614.61
Right-of-use assets - 1,782,725,159.78 1,782,725,159.78
Intangible assets 319,207,126.15 318,693,082.72 (514,043.43)
Goodw ill 833,547,800.60 833,547,800.60
Long-term prepaid expenses 311,328,706.46 311,328,706.46
Deferred tax assets 74,914,209.95 74,914,209.95
Other non-current assets 72,365,863.71 58,168,919.11 (14,196,944.60)
Total non-current assets 4,434,684,191.22 6,188,832,509.21 1,754,148,317.99
50
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Total assets 28,930,300,519.97 30,520,408,266.84 1,590,107,746.87
III Summary of significant accounting policie s and accounting e stimates (Continued)
(33) Changes in accounting policies and accounting e stimate s (Continued)
LIABILITIES 31 December 2018 1 January 2019 Adjustment
Current liabilities
Short-term borrowings 2,597,652,702.43 2,597,652,702.43
Notes payable 3,416,755,681.80 3,416,755,681.80
Accounts payable 6,468,535,961.17 6,468,535,961.17
Advances from customers - -
Employee benefits payable 231,866,407.40 231,866,407.40
Tax payable 241,980,412.72 241,980,412.72
Other payables 1,539,436,971.93 1,539,436,971.93
Incl: Interest payable 21,906,660.63 21,906,660.63
Dividends payable 6,389,320.96 6,389,320.96
Contract liabilities 255,590,612.37 255,590,612.37
Non-current liabilities due w ithin one year 5,861,324.37 495,132,751.96 489,271,427.59
Other current liabilities 292,465.75 292,465.75
Total current liabilities 14,757,972,539.94 15,247,243,967.53 489,271,427.59
Non-current liabilities
Long-term borrow ings 31,600,000.00 31,600,000.00
Lease liabilities - 1,104,600,297.80 1,104,600,297.80
Long-term payables 4,563,978.52 800,000.00 (3,763,978.52)
Long-term employee benefits payable 2,050,000.00 2,050,000.00
Deferred income 91,491,170.40 91,491,170.40
Deferred tax liabilities 67,605,161.88 67,605,161.88
Other non-current liabilities 69,241,176.18 69,241,176.18
Total non-current liabilities 266,551,486.98 1,367,387,806.26 1,100,836,319.28
Total liabilities 15,024,524,026.92 16,614,631,773.79 1,590,107,746.87
51
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(33) Changes in accounting policies and accounting e stimate s (Continued)
SHAREHOLDERS’ EQUITY 31 December 2018 1 January 2019 Adjustment
Shareholders’ equity
Share capital 428,126,983.00 428,126,983.00
Capital surplus 4,320,984,981.51 4,320,984,981.51
Surplus reserve 214,063,491.50 214,063,491.50
6,655,257,147.27 6,655,257,147.27
Retained earnings
Shareholders’ equity attributable
11,618,432,603.28 11,618,432,603.28
to shareholders of the parent
2,287,343,889.77 2,287,343,889.77
Non-controlling interests
13,905,776,493.05 13,905,776,493.05
Total shareholders’ equity
Total liabilities and shareholders’ 28,930,300,519.97 30,520,408,266.84 1,590,107,746.87
equity
52
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(33) Changes in accounting policies and accounting e stimate s (Continued)
Company’s balance sheet：
ASSETS 31 December 2018 1 January 2019 Adjustment
Current assets
Cash and bank balances 1,817,654,598.01 1,817,654,598.01
Notes receivable 63,870,980.39 34,154,774.75 (29,716,205.64)
Accounts receivable 631,236,593.94 631,236,593.94
Receivable financing 29,716,205.64 29,716,205.64
Ad vances to suppliers 4,760,182.00 4,757,318.66 (2,863.34)
Other receivables 1,541,980,883.50 1,541,980,883.50
Incl:Interest receivable 7,550,877.07 7,550,877.07
Di vidends receivable - -
Inventories 158,166,185.65 158,166,185.65
Other current assets 39,482.38 39,482.38
Total current assets 4,217,708,905.87 4,217,706,042.53 (2,863.34)
Non-current assets
Long-term equity investments 7,432,906,692.24 7,432,906,692.24
Other non-current financial 140,000,000.00 140,000,000.00
assets
Investment properties 1,955,854.46 1,955,854.46
Fixed assets 21,362,422.03 21,362,422.03
Right-of-use assets - 6,827,171.38 6,827,171.38
Intangible assets 2,452,222.51 2,452,222.51
Long-term deferred expenses 7,481,809.53 7,481,809.53
Other non-current assets 7,000,000.00 7,000,000.00
Total non-current assets 7,613,159,000.77 7,619,986,172.15 6,827,171.38
Total assets 11,830,867,906.64 11,837,692,214.68 6,824,308.04
53
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(33) Changes in accounting policies and accounting e stimate s (Continued)
LIABILITIES 31 December 2018 1 January 2019 Adjustment
Current liabilities
Short-term borrowings 539,000,000.00 539,000,000.00
Notes payable 252,317,800.78 252,317,800.78
Accounts payable 442,049,241.22 442,049,241.22
Contract liabilities 4,182,083.40 4,182,083.40
Employee benefits payable 36,233,563.12 36,233,563.12
Tax pa yables 13,426,601.90 13,426,601.90
Other payables 1,481,817,856.56 1,481,817,856.56
Incl:Interest payable 1,354,592.35 1,354,592.35
Non-current liabilities
- 786,068.44 786,068.44
due within one year
Other current liabilities 226,427.99 226,427.99
Total current liabilities 2,769,253,574.97 2,770,039,643.41 786,068.44
Non-current liabilities
Long-term borrowings 31,600,000.00 31,600,000.00
Lease liabilities - 6,038,239.60 6,038,239.60
Long-term payables 800,000.00 800,000.00
Long-term employee 118,000.00 118,000.00
benefits payable
Deferred income 1,687,899.50 1,687,899.50
Deferred tax liabilities 2,298,426.39 2,298,426.39
Total non-current liabilities 36,504,325.89 42,542,565.49 6,038,239.60
Total liabilities 2,805,757,900.86 2,812,582,208.90 6,824,308.04
54
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
III Summary of significant accounting policie s and accounting e stimates (Continued)
(33) Changes in accounting policies and accounting e stimate s (Continued)
SHAREHOLDERS’ EQUITY 31 December 2018 1 January 2019 Adjustment
Shareholders’ equity
Share capital 428,126,983.00 428,126,983.00
Capital surplus 4,426,362,777.26 4,426,362,777.26
Surplus reserves 214,063,491.50 214,063,491.50
Retained earnings 3,956,556,754.02 3,956,556,754.02
Total shareholders’ equity 9,025,110,005.78 9,025,110,005.78
Total liabilities and shareholders’ 11,830,867,906.64 11,837,692,214.68 6,824,308.04
equity
55
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
IV Taxation
1. Main categories and rates of taxes:
Categories Tax base Tax rate
Corporate income tax
(“CIT”) Taxable income 15%,20% or 25%
Taxable value added amount (Tax
payable is calculated by using the
taxable sales amount multiplied
by the effective tax rate less
Value added tax deductible VAT input of the 0%,3%,5%,6%,9%,
(“VA T”) current period) 10%,13%,16%
City maintenance and
construction tax Amount of VAT 5% or 7%
Educational surcharge Amount of VAT 3%
Local educational
surcharge Amount of VAT 2%
2. Tax preferences
(a) In 2011, the Urumqi Head Office, Changji Branch and Karamay Branc h of Sinopharm Holding
Xinjiang New & Special Medicines Chain Store Co., Ltd. (“Xinjiang New & Special Medicines”),
subsidiaries of the group, shall pay tax at a rate of 15% by jurisdictions. According to the Circula r
of the Ministry of Finance, the State Administration of Taxation, the General Administration of
Customs on Issues Concerning Tax Policies for the Further Development of the Western Regions
(Cai shui [2011] No.58), enterprises from encouraged industries in the Western Regions, could
enjoy a reduc ed CIT rate of 15% from 1 January 2011 to 31 December 2020.
In 2014, the Group’s subsidiary Sinopharm Holding Guangxi Logistics Co., Ltd. (“Sinopharm
Guangxi Logistics”) was approved by the Guangxi Loc al Tax Burea u to enjoy a tax discount
applicable to c orporations in the region of Western Development to pay income tax at a tax rate of
15%.
Eight subsidiaries in Guangxi Province of the Group, including Sinopharm Guangxi, Sinopharm
Holding Liuzhou Co., Ltd. (“Sinopharm Liuzhou”) , Sinopharm Holding B eihai Co., Ltd (“Sinopharm
Beihai”), Sinopharm Holding Guilin Co., Ltd. (“Sinopharm Guilin”), Sinopharm Holding Guigang
Co., Ltd. (“Sinopharm Guigang”), Sinopharm Holding Yulin Co., Ltd. (“Sinopharm Yulin”),
Sinopharm Holding Baise Co., Ltd (“Sinopharm B aise”)and Sinopharm Holding Wuzhou Co., Ltd.
(“Sinopharm Wuzhou”) were all approved by the Guangxi Local Tax Bureau to enjoy a tax
concession of Western Development at a preferential CIT rat e of 15%. The applicable period for
Sinopharm Guangxi, Sinopharm Liuzhou and Sinopharm Beihai is 1 January 2014 to 31 December
2020, and that for the other 5 subsidiaries is 1 January 2015 to 31 December 2020.
56
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
IV Taxation (Continued)
2. Tax preferences (Continued)
The Group's subsidiary Sinopharm Holding National Pharmacy Inner Mongolia Co., Ltd.
(hereinafter referred to as "National University of Inner Mongolia"), Sinopharm Holding National
Pharmacy Hulunbeier Co., Ltd., Sinopharm Holding National Pharmacy Wulanchabu Co., Ltd. ,
National University Pharmacy Manz houli Co., Ltd., Sinopharm Holding National Pharmacy
Bayannaoer Co., Ltd. and Inner Mongolia NUS Pharmaceutical Co., Ltd., in accordance with the
provisions of Caishui [2011] No. 58 Document, meet the conditions for the enjoyment of corporate
income tax benefits in the Western Development, and obtain the Notice of Approval for Reduction
and Exemption of Taxes. In 2019, the enterprise income tax was paid at a preferential tax rate of
15%. According to Caishui [2011] No. 58 Document, Sinopharm Holding National Pharmacy
Guangxi Chain Co., Ltd. and Ningxia Guoda Pharmacy Chain Co., Ltd. reduced the corporate
income tax of 2019 at a reduced rate of 15%.
In the half year of 2019, according to the "Notice on Implementing the Incl usive Tax Deduction
Policy for Small and Micro Enterprises" (Cai Shui [2019] No. 13): the Group's subsidiary
Sinopharm Medic al Supply Chain Service (Guangxi) Co., Ltd., Shanghai Guoda Dongsheng
Pharmacy Co., Ltd., Sinopharm Holding National P harmacy Guangz hou Chain Co., Ltd., Taishan
City Guokong Guoda Group Kangda Pharmacy Chain Co., Ltd., Guangxi Guoda P harmaceutical
Cons ulting Chain Co., Ltd., Changzhi City Guoda Wanmin Pharmacy Co., Ltd., Shanghai Fumei
Xuhui Pharmacy Co., Ltd., Sanhe Liyang Jinxiang Pharmacy Co., Ltd., Sinopharm Holding
National Pharmacy Hulunbeier Co., Ltd. The company, NUS Pharmacy Manzhouli Co., Ltd. pays
taxable inc ome less than RMB 3 million, and meets the requirements of small and meager profit
enterprises, so it pays corporate income tax at a rate of 20%.
57
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements
1. Cash and bank balances
30 June 2019 1 January 2019
Cash on hand 3,415, 085.25 5,587, 191.18
Cash at banks 7,765, 559,793.66 7,626, 529,829.59
Other cash balances 317,353,629.58 457,664,283.79
8,086, 328,508.49 8,089, 781,304.56
At 30 June 2019, other cash balances were consisted of letter credit deposits amounting to RMB
305,806.00 (31 December 2018: RMB 4,191,246.00), bank acceptance notes deposits amounting to
RMB317,047,823.58 (31 December 2018: RMB453,473,037.79).
2. Note s receivable
30 June 2019 1 January 2019
Trade acceptance notes 790,664,828.26 789,536,654.23
Bank acceptance notes - -
790,664,828.26 789,536,654.23
58
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
2. Note s receivable (Continued)
Notes rec eivable endorsed or discounted by the Group to other parties which were not yet due at
30 June 2019 and 31 December 2018 are as follows:
30 June 2019
Derecognized Not derecognized
Trade acceptance notes 216,316,836.99
Bank acceptance notes -
216,316,836.99
As at 30 June 2019 and 31 December 2018, notes that were convert ed into accounts receivable
due to the drawer’s inability to settle the note on maturity date are as follows:
30 June 2019
Bank acceptance notes -
Trade acceptance notes 20,010,459.85
20,010,459.85
3. Accounts receivable
The accounts receivable by category are analyzed below:
1 Januar y 2019
30 J une 2019
Gross carryi ng amount Provision for bad debt Gross carryi ng amount Provision for bad debt
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Items for
which
provision for
bad debt is
recognised
separatel y 613,529,239.36 5.17% 19,044,116.83 3.10% 595,919,487.29 6.36% 16,766,679.23 2.81%
Items for
which
provision for
bad debt is
recognized by
group (credit
risk
characteristics
) 11,262,211,636.12 94.83% 30,256,027.06 0.27% 8,780,463,595.37 93.64% 22,754,755.51 0.26%
11,875,740,875.48 100.00% 49,300,143.89 0.42% 9,376,383,082.66 100.00% 39,521,434.74 0.42%
59
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
At 30 June 2019, accounts receivable that are individually significant and individually assessed for provisions
are as follows:
Carrying Bad debt
Accounts receiv able(by company) amount provis ion Rate Assessment for impairment
Receivable of medical insurance Part of the medical insurance receivable
takes longer to collect, and has ris k of
352,956,757.11 588,948.80 0.17% default
Receivable of E-Business other Receivable of E-Business w ith low risk
suppliers 110,676,893.44 6,739,296.66 6.09% of recoverability
Receivable of card settlement, e- Receivable of Franchises w ith no risk of
-
commerce and third-party 55,508,719.88 0.00% recoverability
payment platform party Receivable due from a related party with
--
47,567,694.11 0.00% low ris k of recoverability
Daton Xin Jian Kang Hospital - Receivable due from a fix ed cooperativ e
hospital w ith no risk of recoverability
21,439,257.44 - 0.00%
Liuzhou Railw ay Central Hospital Both parties to the transaction have
differences in the amount of purchase
13,820,739.09 156,693.08 1.13% and sales and has risk of default
Hubei xianning Pharmaceutical A lawsuit has been filed against the
Co., Ltd., customer and has high risk of default
11,559,178.29 11,559,178.29 100.00%
613,529,239.36 19,044,116.83
Total - -
Provision for bad debts of accounts receivable according to the general model of expected credit
loss:
30 June 2019
Expected credit loss in entire
Estimated def ault amount lif etime Expected credit loss rate
11,186,234,127.33 25,495,025.53 0.23%
Within 1 y ear
71,069,101.89 3,646,494.40 5.13%
1 to 2 y ears
1,616,063.02 194,281.68 12.02%
2 to 3 y ears
3,292,343.88 920,225.45 27.95%
Ov er 3 years
11,262,211,636.12 30,256,027.06
60
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
The aging analysis of accounts receivables was as follows:
30 June 2019
Within 1 year 11,753,416,277.07
1 to 2 years 80,575,034.81
2 to 3 years 3,374,443.53
3 to 4 years 24,801,268.92
4 to 5 years 12,775,655.02
Over 5 years 798,196.13
Total
11,875,740,875.48
Bad debt provision for the current period as follows:
Written
Opening Reversal of write-off Increases in Reversal in Closing
off in
balance in previous years the year the year balance
the year
Bad debts 39,521,434.74 11,040.00 16,376,925.13 (6,609,255.98) - 49,300,143.89
total 39,521,434.74 11,040.00 16,376,925.13 (6,609,255.98) - 49,300,143.89
On 30 June 2019, the top five accounts receivable by customer are summarised
below:
% of the
total
Bad debt accounts
provision receivabl
Amount amount e
The top five accounts
receivable total 861,862,590.71 363,240.29 7.25%
On 30 June 2019, the Group's accounts receivable that were terminated due to the cooperation on
accounts receivable factoring with financial institutions without recourse were RMB
2,707, 165,636.40.
61
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
4. Accounts receivable financing
30 June 2019 1 January 2019
Bank acceptance notes 325,439,580.18 567,775,275.40
325,439,580.18 567,775,275.40
5. Advance s to suppliers
(a) The aging of advances to suppliers is analyzed below:
30 June 2019 1 January 2019
Amount % of total balance Amount % of total balance
Within 1 year 355,664,414.27 99.60% 416,103,769.08 99.20%
1 to 2 years 1,215,326.29 0.34% 873,351.85 0.21%
2 to 3 years 109,088.48 0.03% 2,466,823.90 0.59%
Above 3 years 89,990.60 0.03% - -
357,078,819.64 - 419,443,944.83 -
The prepayment aged for more than a year is mainly the advance equipment amounting to RMB1,414,405.37
(31 December 2018: RMB3,340,175.75) as the hospital equipment procurement is a large project which
takes a long time to complete.
(b) On 30 June 2019, the top five ad vances to suppliers by custom er are summarized below:
Amount Proportion of total balance
Total amount of top five advances to suppliers 128,740,740.37 36.05%
62
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
6. Other receivables
30 June 2019 1 January 2019
Interest receivable 14,791,483.10 8,223,327.64
Other receivables 639,294,904.75 635,270,031.68
654,086,387.85 643,493,359.32
（ 1） Interest receivable
30 June 2019 1 January 2019
Fixed deposits 13,306,641.88 6,376,708.68
Entrusted Loans 1,484,841.22 1,846,618.96
14,791,483.10 8,223,327.64
（ 2） Other receivables
Category of other receivables by nature is as follows:
Nature 30 June 2019 1 January 2019
Deposits 257,903,552.46 278,455,623.30
Receivable due from related parties 10,414,842.49 8,119,399.79
Entrusted borrowings 44,000,000.00 44,000,000.00
Petty cash advance to employees 17,538,148.13 12,439,613.27
Receivable of equity transactions 8,980,000.00 8,980,000.00
Others 321,989,366.05 303,197,349.04
Total 660,825,909.13 655,191,985.40
63
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
The changes in bad debt provision for other receivables based on the entire lifetime expected
credit losses are as follows:
Stage 1 Stage 2 Stage 3
Expected Entire lifetime Total
credit Entire lifetime expected credit
losses expected credit losses(Credit
Bad debt
over the losses(No credit impairment occurred)
next 12 impairment
months occurred)
Balance at 1 January 2019 - 19,921,953.72 - 19,921,953.72
Balance at 1 January 2019 during the period
Provisions during the period - 3,108,281.87 - 3,108,281.87
Reversal during the period - (1,441,849.89) - (1,441,849.89)
Write-back during the period - - - -
Write-off during the period - (57,381.32) - (57,381.32)
Other Changes - - - -
Balance at 30 June 2019 - 21,531,004.38 - 21,531,004.38
64
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
The aging analysis of other receivables was as follows:
30 June 2019
Within 1 year 526,279,992.21
1 to 2 years 98,441,809.40
2 to 3 years 15,955,086.40
Over 3 years 20,149,021.12
Total 660,825,909.13
Bad debt provision of other receivables in 2019 was RMB3, 108, 281.87, with the recovered or
reversed amount of RMB 1,441,849.89, and the written off amount of RMB 57,381.32.
As at 30 June 2019， the top 5 parties that owed the largest amounts of other receivable
balances are analyzed below:
Nature Amount Age % of total amount Provision of bad debt
Guangdong Phar mac eutical electronic Phar mac eutic al tradi ng platform Within 1
trading platfor m repayment not yet cl eared 111,024,446.08 year 16.80%
Sinophar m Group Z hijun (Suzhou) Within 2
Phar maceutical C o., Ltd. Entrusted borrowings 44,000,000.00 year 6.66%
TCM-Integrated C ancer C enter of Deposit of logistics extension Within 2
Southern Medic al Uni versity services projec t 30,082,900.00 year 4.55%
Shenyang Medical Insurance Within 1
Management Servic e Center Amount due from government 27,635,423.96 year 4.18%
Shenzhen Social Insur ance Fund Within 1
Admi nistration Amount due from government 18,714,610.23 year 2.83%
231,457,380.27 35.03% -
65
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
7. Inventories
(a) Inventories by category are analyzed below:
30 June 2019 1 January 2019
Book v alue Prov ision Net book v alue Book v alue Prov ision Net book v alue
Raw materials 362,562.93 - 362,562.93 1,410,012.28 - 1,410,012.28
Work in progress 5,344.32 - 5,344.32 1,011,007.23 - 1,011,007.23
Finished goods 4,883,623,033.69 7,772,292.62 4,875,850,741.07 4,392,144,746.88 8,313,195.29 4,383,831,551.59
Low cost consumables 6,454,967.95 - 6,454,967.95 3,083,371.09 - 3,083,371.09
4,890,445,908.89 7,772,292.62 4,882,673,616.27 4,397,649,137.48 8,313,195.29 4,389,335,942.19
(b) Provision for declines in value of inventories is analysed below:
Increases Decreases
1 January 2019 Reversal or 30 June 2019
charge Other Other
Written off
Finished goods 8,313,195.29 1,567,262.18 - 2,108,164.85 - 7,772,292.62
8,313,195.29 1,567,262.18 - 2,108,164.85 - 7,772,292.62
8. Other current assets
30 June 2019 1 January 2019
Input VAT to be credited 95,048,826.51 94,312,573.34
Corporate income tax to be deducted 2,041,094.25 723,000.46
Others 227,366.84 312,055.38
97,317,287.60 95,347,629.18
66
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
9. Long-term equity inve stments
Associates in 2019
C ha n ge s in t he yea r
Pro vi si o n f o r
Inve stee 1 Ja nu a ry 2 01 9 C a sh di vid e nd 30 Jun e 2 01 9
Ad diti on al Profi t of l o ss u n de r Ot he r ch a ng e s i n Im p airm e nt im pai rm en t
de cl a red b y
In ve st m e nt eq uit y me th o d eq uit y pro vi si o n
in ve st ee
Associate s
Sh e n zh e n M ain L u ck P h arm a ce uti cal I n c.
(“Mai n Lu ck Ph a rm a ce uti cal ”). 26 5, 3 16 ,6 5 3. 68 - 33 ,5 9 2, 99 5. 7 0 - - - 29 8, 9 09 ,6 4 9. 38 -
Zhiju n M e di cin e 35 5, 3 53 ,1 9 6. 15 - 58 ,5 3 6, 10 1. 7 4 - - - 41 3, 8 89 ,2 9 7. 89 -
Zhiju n Trad e
8, 73 0, 9 94 .8 7 - 1, 46 7, 0 31 .7 7 - - - 10 ,1 9 8, 02 6. 6 4 -
Zhiju n Su zh o u 23 ,3 7 9, 01 8. 9 2 - (1 1, 3 90 ,5 3 8. 03 ) - - - 11 ,9 8 8, 48 0. 8 9 -
Pin g sha n M e di cin e 86 ,2 9 2, 92 7. 3 3 - 22 ,4 2 5, 90 0. 4 5 - - - 10 8, 7 18 ,8 2 7. 78 -
Sh yn de c Ph a rma ce uti cal 1, 09 8, 5 66 ,8 5 2. 51 - 65 ,2 5 8, 50 3. 4 5 42 ,4 2 4, 74 7. 0 0 (1 6, 8 96 ,4 2 7. 80 ) - 1, 18 9, 3 53 ,6 7 5. 16 -
Sh a ng h ai B ei yi Gu o d a P h a rma ce uti cal C o. Lt d. 11 ,0 2 9, 91 8. 1 0 - 24 7, 5 88 .4 9 - (1 ,0 5 2, 99 9. 9 9 ) - 10 ,2 2 4, 50 6. 6 0 -
Sh a ng h ai Li yi P h arm a cy C o., L td . 95 5, 4 28 .2 3 - - - - - 95 5, 4 28 .2 3 -
Sh a ng h ai R en b ei P h arm a cy C o., L td - 1, 80 0, 0 00 .0 0 - 1, 80 0, 0 00 .0 0
Gu a ng d on g Ji a nh ui C o n st ru cti on I n ve st m en t
M an a ge m e nt C o. , Lt d. - 2, 00 0, 0 00 .0 0 - 2, 00 0, 0 00 .0 0
Sin op h a rm Ji en u o M edi cal Tre at m en t S e rvi ce
Gu a ng d on g C o. , Lt d. (“Gu an g do n g Ji e n uo ”) 6, 80 2, 1 56 .1 9 - (9 9 5, 29 3. 5 8 ) - - - 5, 80 6, 8 62 .6 1 -
Sh a ng h ai Din g qu n M a na g e me nt & Co n sulti ng
C o. , Lt d 23 ,9 6 6, 64 0. 1 2 - - - - - 23 ,9 6 6, 64 0. 1 2 -
D on g yu an A cco rd Ph a rma ce uti cal C h ain Co .,
Lt d. 39 6, 6 38 .3 2 - - - - - 39 6, 6 38 .3 2 39 6, 6 38 .3 2
1, 88 0, 7 90 ,4 2 4. 42 3, 80 0, 0 00 .0 0 16 9, 1 42 ,2 8 9. 99 42 ,4 2 4, 74 7. 0 0 (1 7, 9 49 ,4 2 7. 79 ) - 2, 07 8, 2 08 ,0 3 3. 62 39 6, 6 38 .3 2
67
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
10. Other equity instrument investment
30 June 2019 1 January 2019
Sinopharm Health Online Co., Ltd. 12 ,0 0 0, 00 0. 0 0 12 ,0 0 0, 00 0. 0 0
Sinopharm Guoda Hubei Co., Ltd. 1, 00 0, 0 00 .0 0 1, 00 0, 0 00 .0 0
Hunan Zhongbai Pharmaceutical
Investment Co., Ltd. 31 5, 0 00 .0 0 31 5, 0 00 .0 0
Shanghai Guoda Shuguang Pharmacy
Co., Ltd 27 0, 7 60 .0 0 27 0, 7 60 .0 0
Shanghai Guoren Pharmacy Co., Ltd. 10 0, 0 00 .0 0 10 0, 0 00 .0 0
13 ,6 8 5, 76 0. 0 0 13 ,6 8 5, 76 0. 0 0
11. Other non-current financial assets
30 June 2019 1 January 2019
Financial asset measured at fair value
through current profit or loss 140,000,000.00 140,000,000.00
140,000,000.00 140,000,000.00
On June 30, 2019, the balance of other non-current financial assets was the fair value of the share of the
Sinopharm CICC Medical Industry Fund (referred to as “the Industrial Fund”) subscribed by the Company. The
Group's 21st meeting of the 7th Board of Directors held on January 6, 2017 reviewed and approved the proposal
of the Company to subscribe for the industry fund and related party transactions. As a limited partner of the
industry fund, the company plans to invest RMB 200 million to subscribe for the share of the industrial fund, which
will be paid in three phases. The company paid the initial investment of RMB 60 million in 2017. As of December
31, 2017, the fund did not complete the relevant licenses and approvals and did not start operations. Therefore,
the company's initial investment amounted to RMB 60 million. Included in other non -current assets. In 2018, the
company paid the second phase of the capital contribution of RMB 80 million. As of June 30, 2019, the company
had paid a total of RMB 140 million. The industry fund has obtained relevant approvals in 2018 and has started
operations. Since the cash flow obtained by the Company from the investment of the fund includes both the
contractual cash flow generated by the underlying assets during the investment period and the cash flow of the
disposal of the underlying assets, the contractual cash flow that does not satisfy the financial assets generated on
a specific date is only The payment of interest on the basis of the outstanding principal amount, therefore, the
Company classifies the investment of the industrial fund into financial assets measured at fair value through profit
or loss and presented as other non-current financial assets. .
68
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
12. Investment propertie s
Subsequent measurement under the cost model:
Construction in
2019 Buildings and progress
constructions Land use right Total
Original cost
Opening balance 242,555,189.91 22,719,102.03 265,274,291.94
Purchase - - -
Transfer to fix ed assets 1,634,951.97 - 1,634,951.97
assets balance
Closing 240,920,237.94 22,719,102.03 263,639,339.97
Accumulated
depreciation and
amortization
Opening balance 111,131,166.21 7,948,629.76 119,079,795.97
Provision 3,376,058.13 51,879.46 3,427,937.59
Transfer to fix ed assets 487,533.59 - 487,533.59
Closing balance 114,019,690.75 8,000,509.22 122,020,199.97
Provision for
impairment
Opening balance 1,300,000.00 - 1,300,000.00
Closing balance 1,300,000.00 - 1,300,000.00
Carrying
amount
At end of the period 125,600,547.19 14,718,592.81 140,319,140.00
At beginning of the period 130,124,023.70 14,770,472.27 144,894,495.97
69
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
13. Fixed assets
2019
Fixed asset
Buildings Machinery Vehicles Other equipment Total
improvements
Original cost
Opening balance 489,661,268.82 185,444,104.09 89,613,300.13 294,575,902.89 54,661,564.43 1,113,956,140.36
Purchase 714,456.83 16,956,031.53 5,069,073.21 15,843,713.46 17,383,853.37 55,967,128.40
Transfer from construction in progress - 2,113,175.66 - 816,880.96 - 2,930,056.62
Business combination not involving enterprises under
- - - - - -
common control
Transfer from Investment properties 1,634,951.97 - - - - 1,634,951.97
Disposal or retirement - 1,487,621.64 5,499,822.63 7,281,743.77 10,306,628.70 24,575,816.74
Closing balance 492,010,677.62 203,025,689.64 89,182,550.71 303,954,753.54 61,738,789.10 1,149,912,460.61
Accumulated depreciation
Opening balance 164,477,441.12 85,085,741.31 59,523,264.14 172,436,749.05 38,364,970.83 519,888,166.45
Provision 7,866,027.60 14,213,255.59 3,843,870.06 12,354,113.52 10,639,915.07 48,917,181.84
Transfer from Investment properties 487,533.59 - - - - 487,533.59
Disposal or retirement - 1,107,179.83 3,813,515.96 4,549,800.50 3,462,405.97 12,932,902.26
Closing balance 172,831,002.31 98,191,817.07 59,553,618.24 180,241,062.07 45,542,479.93 556,359,979.62
70
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
13. Fixed assets (Continued)
2019(Continued)
Fixed asset
Buildings Machinery Vehicles Other equipment Total
improvements
Provision for impairment
Opening balance - - - - - -
Disposal of subsidiaries - - - - - -
Closing balance - - - - - -
Carrying amount
At end of period 319,179,675.31 104,833,872.57 29,628,932.47 123,713,691.47 16,196,309.17 593,552,480.99
At beginning of the period 325,183,827.70 100,358,362.78 30,090,035.99 122,139,153.84 16,296,593.60 594,067,973.91
71
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
13. Fixed assets (Continued)
Fixed assets without official property right certificates
Items Carrying amount Reason for outstanding property right certificates
Buildings 27,259,503.70 In the process
14. Construction in progre ss
30 June 2019 1 January 2019
Construction in progress 31,980,582.21 36,412,614.61
30 June 2019 1 January 2019
Carrying balance Impair ment Carrying amount Carrying balance Impair ment Carrying amount
Warehouse improvement project 862,479.40 - 862,479.40 806,272.40 - 806,272.40
New office building project 627,903.09 - 627,903.09 188,251.26 - 188,251.26
Supply chain extension project 15,025,013.15 - 15,025,013.15 12,617,953.89 - 12,617,953.89
Software project 5,544, 210.47 - 5,544, 210.47 12,930,498.53 - 12,930,498.53
Other projects 9,920, 976.10 - 9,920, 976.10 9,869, 638.53 - 9,869, 638.53
31,980,582.21 - 31,980,582.21 36,412,614.61 - 36,412,614.61
72
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
14. Construction in progre ss (Continued)
(a) Changes of significant construction in progress
Changes of significant construction in progress in 2019 are presented as follows:
Proportion of project Source of
Decrease At end of year investment to progres
funds
At beginning of budget (%) s
Project name Budget Increase
the year Transferred
Transferred to to intangible Others
fixed asset s assets
Warehouse
improvement
project 2,981,387.76 806,272.40 1,309,197.95 278,461.63 - 974,529.32 862,479.40 60.65% 60.65% Own funds
New office building
Project 627,903.08 188,251.26 439,651.83 - - - 627,903.09 100.00% 100.00% Own funds
Supply chain
extension project 33,412,417.24 12,617,953.89 5,137,275.29 2,606,162.49 - 124,053.54 15,025,013.15 53.80% 53.80% Own funds
Software project 12,949,580.19 12,930,498.53 5,563,292.13 45,432.50 - 12,904,147.69 5,544,210.47 43.20% 43.20% Own funds
Other construction
projects 206,249,966.06 9,869,638.53 83,546.40 - 32,208.83 9,920,976.10 4.84% 4.84% Own funds
256,221,254.33 36,412,614.61 12,532,963.60 2,930,056.62 14,034,939.38 31,980,582.21 - -
183
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
15、 Right-of-use assets
Items Stores Office building Warehouse Others Total
Original cost
Opening balance 1,471,295,979.51 48,588,435.58 239,171,388.66 23,669,356.03 1,782,725,159.78
Increase 364,813,035.13 25,970,953.21 33,172,962.78 423,956,951.12
Closing balance 1,836,109,014.64 74,559,388.79 272,344,351.44 23,669,356.03 2,206,682,110.90
Accumulated depreciation
Opening balance - - - - -
Depreciation 261,325,528.91 8,926,444.74 22,855,535.44 2,593,404.18 295,700,913.27
Closing balance 261,325,528.91 8,926,444.74 22,855,535.44 2,593,404.18 295,700,913.27
Carrying amount
At end of the period 1,574,783,485.73 65,632,944.05 249,488,816.00 21,075,951.85 1,910,981,197.63
At beginning of the period 1,471,295,979.51 48,588,435.58 239,171,388.66 23,669,356.03 1,782,725,159.78
74
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
16. Intangible assets
2019 Land use right Software Trademarks Favorable lease Sales network Franchise Total
Original cost
Opening balance 62,083,143.97 142,108,155.42 65,977,850.00 93,242,000.00 112,117,142.86 710,000.00 476,238,292.25
Purchase - 3,733,823.60 - - - - 3,733,823.60
Transfer from construction in
progress - 12,904,147.69 - - - - 12,904,147.69
Disposal or retirement - - - - - - -
Closing balance 62,083,143.97 158,746,126.71 65,977,850.00 93,242,000.00 112,117,142.86 710,000.00 492,876,263.54
Accumulated amortization
Opening balance 27,889,638.96 68,273,563.72 196,850.16 19,782,823.36 40,692,333.33 710,000.00 157,545,209.53
Provision 474,270.36 9,058,311.54 - 2,472,852.94 2,802,928.58 - 14,808,363.42
Closing balance 28,363,909.32 77,331,875.26 196,850.16 22,255,676.30 43,495,261.91 710,000.00 172,353,572.95
Provision for impairment - - - - - - -
Opening balance - - - - - - -
Provision - - - - - - -
Closing balance - - - - - - -
Carrying amount
33,719,234.65 81,414,251.45 65,780,999.84 70,986,323.70 68,621,880.95 - 320,522,690.59
At end of the period
At beginning of the period 34,193,505.01 73,834,591.70 65,780,999.84 73,459,176.64 71,424,809.53 - 318,693,082.72
75
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
17. Goodwill
(1) Goodwill cost
30 June 2019 Opening balance Increase Decrease Closing balance
Sinopharm Holding(Jiangmen)
Medical Co., Ltd. (“Sinopharm
Jiangmen”) 27,392,317.73 - - 27,392,317.73
Sinopharm Holding Shenzhen
Y anf eng Co., Ltd. (“Sinopharm
Y anf eng”) 16,868,644.87 - - 16,868,644.87
Sinopharm Holding Zhaoqing Co., Ltd.
(“Sinopharm Zhaoqing”) 2,594,341.53 - - 2,594,341.53
Sinopharm Holding Shaoguan Co.,
Ltd. (“Sinopharm Shaoguan”) 1,686,496.80 - - 1,686,496.80
Sinopharm Holding Meizhou Co., Ltd.
(“Sinopharm Meizhou”) 1,610,819.66 - - 1,610,819.66
Sinopharm Holding Huizhou Co., Ltd.
(“Sinopharm Huizhou”) 923,184.67 - - 923,184.67
Sinopharm Holding Zhanjiang Co.,
Ltd. (“Sinopharm Zhanjiang”) 282,135.55 - - 282,135.55
Sinopharm Holding Dongguan Co.,
Ltd. (“Sinopharm Dongguan”) 1,499.02 - - 1,499.02
South Pharma & Trade 2,755,680.62 - - 2,755,680.62
Foshan Nanhai 88,877,850.51 - - 88,877,850.51
Sinopharm Holding Zhuhai
Co.,Ltd.(Sinopharm Zhuhai) 6,772,561.47 - - 6,772,561.47
Sinopharm Holding Maoming Co., Ltd.
(“Sinopharm Maoming”) 66,417.07 - - 66,417.07
Sinopharm Holding Guoda ForMe
Medicines (Shanghai) Co., Ltd.
( “ForMe Medicines”) 3,033,547.53 - - 3,033,547.53
Sinopharm Holding Guoda Henan
Pharmacy Chain Store Co., Ltd 22,666,179.77 - - 22,666,179.77
Sinopharm Holding Guoda Inner
Mongolia Co., Ltd. 70,485,777.00 - - 70,485,777.00
Sinopharm Hebei Lerentang
Pharmaceutical Chain Co., Ltd. 29,482,149.57 - - 29,482,149.57
Sinopharm Guoda Pharmacy
Jiangmen Chain Co., Ltd.. 77,350,000.00 - - 77,350,000.00
Sinopharm Holding Guoda Shanxi
Y iyuan Chain Co., Ltd. 9,080,100.00 - - 9,080,100.00
Taiy uan Tongxinli Guoda Pharmacy
Co., Ltd. 2,818,647.85 - - 2,818,647.85
Sinopharm Holding Guoda Shanghai
Pharmacy Chain Store Co., Ltd. 5,028,638.00 - - 5,028,638.00
Sinopharm Holding Guoda Yangzhou
Dadesheng Pharmacy Chain Store
Co., Ltd.. 7,979,000.00 - - 7,979,000.00
Zhejiang Guoda Pharmacy Co., Ltd. 3,045,183.85 - - 3,045,183.85
Shenzhen Guanganli Pharmacy Chain
Store Co., Ltd. store acquisition. 13,420,000.00 - - 13,420,000.00
Taishan Sinopharm Holding Guoda
Qunkang Pharmacy Chain Co., Ltd. 26,826,120.55 - - 26,826,120.55
Fujian Guoda Pharmacy Chain Store
Co., Ltd. 1,567,250.76 - - 1,567,250.76
76
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
17. Goodwill (Continued)
(1)Goodwill cost (Continued)
30 June 2019 (Continued) Opening balance Increasel Decrease Closing balance
Sinopharm Holding Guoda Shenyang
Pharmacy Chain Store Co., Ltd. 41,047,958.08 - - 41,047,958.08
Sinopharm Holding Guoda Nanjing
Pharmacy Chain Store Co., Ltd. 11,598,341.12 - - 11,598,341.12
Sinopharm Holding Guoda Shandong
Pharmacy Chain Store Co., Ltd. 29,110,409.46 - - 29,110,409.46
Quanzhou Guoda Pharmacy Chain
Store Co., Ltd. 41,298,622.59 - - 41,298,622.59
Sinopharm Holding Hunan Guoda
Minshengtang Pharmacy Chain
Co., Ltd. 41,165,574.64 - - 41,165,574.64
Shanxi Guoda Wanmin Pharmacy
Chain Store Co., Ltd. 65,025,000.00 - - 65,025,000.00
Xiaoy i Guoda Wanmin Baicaotang
Pharmacy Chain Store Co., Ltd. 15,866,680.00 - - 15,866,680.00
Liy ang Guoda People Pharmacy
Chain Store Co., Ltd. 107,275,095.74 - - 107,275,095.74
Sinopharm Holding Guoda ForMe
Pharmacy Chain Store Co., Ltd. 19,405,450.23 - - 19,405,450.23
Beijing Golden Elephant Pharmacy
Medicine Chain Company Limited 64,140,124.36 - - 64,140,124.36
Sinopharm Holding Guoda
Bay annaoer Co., Ltd. - 13,494,000.00 - 13,494,000.00
858,547,800.60 13,494,000.00 - 872,041,800.60
77
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
17. Goodwill (Continued)
(2)Provi sion of impairment loss
Changes in provision for impairment of goodwill are presented as follows:
2019 Opening balance Increase Decrease Closing balance
Quanzhou Guoda Pharmacy
Chain Store Co., Ltd. 25,000,000.00 - - 25,000,000.00
The method of goodwill impairment testing process, parameter and recognition of impairment loss:
The recoverable amount of an asset group or a group of asset groups is determined on a financial
budget approved by management covering a five-year period. The cash flows beyond the five -year
period are extrapolated using the inflation rate.
The recoverable amount of the asset group and asset group combination is calculated using the cash
flow forecasting method based on the five-year budget approved by the management. Management
determines the budgetary gross margin based on historical experience and forecasts of market
development, and uses a pre-tax rate that reflects the specific risk of the relevant asset group and asset
group combination as the discount rate. The above assumptions are used to analyze the recoverable
amount of each asset group and asset group combination within the business segment.
18. Long-term prepaid expense s
2019 Opening balance Additions Amortization Other decrease Closing balance
Fixed asset improvement
expenditure 249,458,261.87 47,060,353.55 42,594,066.57 1,166,437.43 252,758,111.42
Acquisition expenditure to
obtain the right to operate 57,617,166.63 3,971,737.95 7,010,668.66 - 54,578,235.92
Others 4,253,277.96 760,218.61 1,002,537.39 35,524.55 3,975,434.63
311,328,706.46 51,792,310.11 50,607,272.62 1,201,961.98 311,311,781.97
78
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
19. Deferred tax assets/liabilities
(a) Deferred tax assets before offseting
30 June 2019 1 January 2019
Deductible temporary Deferred tax Deductible temporary Deferred tax
differences assets differences assets
Provision for
impairment of assets 79,547,128.04 18,378,950.01 68,153,222.07 15,676,020.10
Deductible tax loss 34,968,710.28 8,677,091.14 77,791,621.20 19,311,837.06
Deferred Income 25,565,030.92 6,387,445.17 30,188,142.13 7,547,758.26
Accrued payroll 13,435,720.26 2,963,493.05 64,598,625.74 15,656,015.32
Accrued expenses 132,416,395.94 32,742,594.34 94,108,769.33 22,301,617.95
Others 30,339,847.94 7,164,541.66 6,238,492.18 1,467,765.00
316,272,833.38 76,314,115.37 341,078,872.65 81,961,013.69
(b) Deferred tax liabilities before offseting
30 June 2019 1 January 2019
Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Fair value adjustment
for business
combination not
involving enterprises
under common
control 221,963,869.66 55,490,967.41 227,900,345.39 56,975,086.34
Changes in fair value 87,167,599.53 21,791,899.72 75,366,942.99 17,676,879.28
309,131,469.19 77,282,867.13 303,267,288.38 74,651,965.62
(c) Deferred tax assets and liabilities are presented after being offset against each other:
30 June 2019 1 January 2019
Deferred tax Temporary Deferred tax Temporary
assets/liabilities - differences assets/liabilities - differences
Net after set-off Net after set-off
Deferred tax assets 10,896,608.36 65,417,507.01 7,046, 803.74 74,914,209.95
Deferred tax
liabilities 10,896,608.36 66,386,258.77 7,046, 803.74 67,605,161.88
79
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
19. Deferred tax assets/liabilities (Continued)
(d) The deductible temporary differences and deductible losses that were not recognized as
deferred tax assets are pres ented as follows:
30 June 2019 1 January 2019
Deductible temporary differences 932,951.17 1,480,000.00
Deductible loss (Note) 30,894,876.42 29,391,422.33
31,827,827.59 30,871,422.33
The aforesaid unrecognized deductible losses will due:
30 June 2019 1 January 2019
2019 6,106,580.00 2,864,062.85
2020 1,636,825.76 4,725,707.87
2021 8,256,680.69 2,563,056.08
2022 8,358,197.50 7,261,117.97
2023 6,536,592.47 11,977,477.56
30,894,876.42 29,391,422.33
(Note) As some subsidiaries are still at a loss and it’s uncertain that those subsidiaries can obtain
enough taxable income to offset against the loss in the future. So the Group do not recognise
deferred tax assets which came from the deductible loss of RMB 30,894,876.42 .
80
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
20. Other non-current a ssets
30 June 2019 1 January 2019
Carrying Carrying Carrying Carrying
balance Impair ment amount balance Impair ment amount
Physical assets
reserve specif ically
authorized 44,621,093.48 - 44,621,093.48 47,576,273.75 - 47,576,273.75
Prepayment for
project and
equipment 22,323,493.28 - 22,323,493.28 10,592,645.36 - 10,592,645.36
66,944,586.76 - 66,944,586.76 58,168,919.11 - 58,168,919.11
21. Short-term borrowings
30 June 2019 1 January 2019
Credit borrowings 3,079, 560,758.24 2,427, 639,275.32
Discounted notes 211,316,836.99 170,013,427.11
3,290, 877,595.23 2,597, 652,702.43
As at 30 June 2019, the annual int erest rate for the above borrowings was 4.55% (31
December 2018: 4.65% ).
On June 30, 2019 and December 31 2018, the Group had no short -term loan that were due but
not yet repaid.
81
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
22. Note s payable
30 June 2019 1 January 2019
Commercial accept ance notes 23,896,465.30 13,843,479.73
Bank acceptance notes 3,515, 198,797.04 3,402, 912,202.07
3,539, 095,262.34 3,416, 755,681.80
At 30 June 2019，balance of not es payable at maturity was RMB 0.00. (31 December 2018：RMB
0.00).
23. Accounts payable
30 June 2019 1 January 2019
Trade payables 8,088, 697,602.94 6,468, 535,961.17
At 30 June 2019, the total amount of accounts payable aged over one year was
RMB496,134,298.59(31 December 2018: RMB 467,525,486.03 ).
24. Contract liabilities
30 June 2019 1 January 2019
Ad vances from customers - -
Contract liabilities 239,739,020.90 255,590,612.37
239,739,020.90 255,590,612.37
82
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
25. Employee benefits payable
2019 At beginning of the year Increase Decrease At end of the year
Short-term employee benefits (a) 226,152,409.27 927,118,638.71 1,001,730,616.89 151,540,431.09
Post-employment benefits
(defined contribution plan)(b) 5,248,146.99 93,025,372.36 88,529,751.61 9,743,767.74
Termination benefits (c) 465,851.14 841,185.81 872,153.00 434,883.95
231,866,407.40 1,020,985,196.88 1,091,132,521.50 161,719,082.78
(a) Short-term employee benefits
At beginning of
2019 year Increase Decrease At end of year
Salaries, bonuses, allowances
and grants 210,723,820.21 810,503,119.74 884,415,868.48 136,811,071.47
Staff welf are 1,750,750.89 23,556,598.47 24,295,552.24 1,011,797.12
Social security contribution 1,622,271.12 47,247,265.73 46,045,452.79 2,824,084.06
Incl: Medical insurance 1,362,150.59 42,318,821.55 41,333,544.10 2,347,428.04
Work injury insurance 30,755.69 1,427,211.06 1,394,836.56 63,130.19
Maternity insurance 229,364.84 3,501,233.12 3,317,072.13 413,525.83
Housing funds 1,063,993.02 30,889,248.28 30,946,436.95 1,006,804.35
Labor union funds and
employee education funds 9,956,772.12 13,593,217.16 15,024,466.50 8,525,522.78
Other short-term benefits 1,034,801.91 1,329,189.33 1,002,839.93 1,361,151.31
Total 226,152,409.27 927,118,638.71 1,001,730,616.89 151,540,431.09
(b) Defined contribution plan
2019 At beginning of year Increase Decrease At end of year
Basic pension
insurance 1,755,160.16 88,463,119.33 86,167,938.13 4,050,341.36
Unemployment
insurance 122,350.65 2,587,235.09 2,359,308.38 350,277.36
Contribution to
pension fund 3,370,636.18 1,975,017.94 2,505.10 5,343,149.02
5,248,146.99 93,025,372.36 88,529,751.61 9,743,767.74
Note：For the half year of 2019, the Group provided other termination benefits for severing labor
relations of RMB153,286.50. For the half year of 2018, the Group provided other termination benefits
for severing labor relations of RMB 69,075.00.
83
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
26. Tax payable
30 June 2019 1 January 2019
Value-added tax 61,484,212.40 90,356,534.09
Corporate Income taxes 121,174,058.74 115,226,820.39
Individual income tax payable 4,518,825.00 3,954,139.24
City maintenance and construction surtax 4,994,194.58 6,854,426.95
Educational surcharge payable 3,593,664.02 4,937,147.17
Water conservancy fund payable 5,523,161.32 5,421,280.43
Stamp duty 4,098,721.21 5,854,355.91
Property tax 1,407,180.81 1,123,276.37
Land use tax payable 241,952.24 209,179.29
Others 8,543,031.51 8,043,252.88
215,579,001.83 241,980,412.72
27. Other payables
30 June 2019 1 January 2019
Interest payable 29,012,444.93 21,906,660.63
Dividend payable 6,389,320.96 6,389,320.96
Other payables 1,439,124,932.54 1,511,140,990.34
1,474,526,698.43 1,539,436,971.93
（ 1） Interest payable
30 June 2019 1 January 2019
Long-term loans’ (With periodic payments of
principal and interest charges) interest 35,440.21 38,984.25
Interest on short-term borrowings 10,692,042.51 10,973,397.39
Trade receiv ables’ factoring interest 18,284,962.21 10,894,278.99
29,012,444.93 21,906,660.63
84
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
27. Other payables (Continued)
（ 2） Dividend payable
30 June 2019 1 January 2019
Shanghai Fosun Pharmaceutical (Group) Co., Ltd. 4,835,511.58 4,835,511.58
Zhenfang Zhang 1,389,639.31 1,389,639.31
Meiluo Pharmaceutical Co., Ltd. 164,170.07 164,170.07
6,389,320.96 6,389,320.96
As at 30 June 2019, the Group had no significant dividend aged more than one year and not yet paid
(31 December 2018: nil).
（ 3） Other payables
30 June 2019 1 January 2019
Payables for factoring programs 550,002,940.12 724,272,060.30
Deposit 389,299,163.12 334,821,325.72
Accrued selling and distribution expenses 174,163,680.40 131,493,977.43
Payables arising from acquis ition of subsidiaries 77,082,980.00 78,702,980.00
Payables for construction in progress and
equipment 58,230,154.88 79,380,923.99
Payables for rentals 40,290,060.94 29,298,835.46
Payables to individuals 28,207,673.38 22,730,210.22
Temparary loan 15,800,000.00 15,800,000.00
Payables to related parties 15,581,702.81 5,436,532.76
Payables for land transfer payments 12,597,500.00 18,071,000.00
Equity subscription 10,000,000.00 10,000,000.00
Collection of others 9,067,830.66 7,525,379.59
Others 58,801,246.23 53,607,764.87
1,439,124,932.54 1,511,140,990.34
At 30 June 2019, significant other payables over 1 year are:
Amount payable Reason for outstanding
Non-controlling interests in South
Pharmaceutial Foreign Trade Fu Yuequn
and other 11 natural persons 54,722,980.00 Payment conditions not met
Shenzhen No.1 Construction Engineering
Co., Ltd. 8,605,625.20 Payment conditions not met
Liuzhou Shengli Pharmacy 5,986,288.12 Payment conditions not met
69,314,893.32
V Notes to the consolidated financial statements (Continued)
85
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
27. Other payables (Continued)
The amount arising from the acquisition of subsidiaries is mainly for the shares acquisition of minorities
of South Pharmaceutial Foreign Trade .
At 30 June 2019, other payables due within 1 year amounting to RMB 137,518,449.47(31 December
2018: RMB 136,286,760.04 ) are mainly consisted of construction cost payable, company borrowings
payable, deposits and etc.
28. Non-current liabilities due within 1 year
30 June 2019 1 January 2019
Long-term borrowings due within 1 year 31,600,000.00 -
Lease liabilities due within 1 year 526,696,784.75 495,132,751.96
558,296,784.75 495,132,751.96
29. Other current liabilities
30 June 2019 1 January 2019
Output VAT to be recognized 445,493.48 292,465.75
30. Long-term borrowings
30 June 2019 1 January 2019
Credit borrowings (a) - 31,600,000.00
- 31,600,000.00
(a) At 30 June 2019, the Group has no entrusted borrowings(31 December 2018:
RMB31, 600, 000. 00). The Group's long-term borrowings are loans lent by the China National
Pharmaceutical Group Corporation. The borrowings due within one year have been reclassified to
non-current liabilities due within one year.
At 30 June 2019, the annual interest rate of above -mentioned borrowings was 4.04% (31
December 2018: 4.04% ).
31． Lease liabilities
30 June 2019 1 January 2019
lease payables 1,713,157,908.71 1,599,733,049.76
Less: ： lease payables due within 1 (526,696,784.75) (495,132,751.96)
year
1,186,461,123.96 1,104,600,297.80
86
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
32. Long-term payables
30 June 2019 1 January 2019
Payable for specific projects 800,000.00 800,000.00
Payable for specific projects
At beginning of Reasons of
year Increase Decrease At end of year derred income
Special funds granted by Granted by the
800,000.00 - - 800,000.00 government
government
33. Long-term employee benefits payable
30 June 2019 1 January 2019
Early retirement benefits payable 1,915, 000.00 2,050, 000.00
87
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
34. Deferred income
Reasons of derred
2019 Opening balance Increase Decrease Closing balance income
Government
grants 91,491,170.40 79,184.44 2,847,536.66 88,722,818.18 Government grants
91,491,170.40 79,184.44 2,847,536.66 88,722,818.18
As at 30 June 2019, deferred income from government grants are as follow:
Government grants Opening Addition in Amount included Amount Closing balance Asset related/
program balance the year in non-operating included in income related
income in the other income
year in the year
Resettlement
Compensation (i) 75,555,441.17 - 1,349,204.28 - 74,206,236.89 Asset related
Guangxi Logistics Project 6,453,426.58 - - 230,346.06 6,223,080.52 Asset related
Guangzhou Logistics
standardization project 2,815,012.55 - - 273,123.42 2,541,889.13 Asset related
A comprehensive
experimental modern
service industry
subsidies 1,500,000.00 - - 150,000.00 1,350,000.00 Asset related
Shared Logistics Center 252,058.35 - - 9,400.20 242,658.15 Asset related
Asset/Income
Other projects 4,915,231.75 79,184.44 835,462.70 4,158,953.49 related
91,491,170.40 79,184.44 1,349,204.28 1498332.38 88,722,818.18
Due to the implementation of urban planning for old town reconstruction in Nanning, the operating center of
Guangxi Logistics which was located in Longteng Road District, Nanning City, was to be reconstructed in
another place. According to the agreement signed between Guangxi Logistics and the real estate developer,
Guangxi Logistics would obt ain a compensation of RMB120,250,000.00, including cash of RMB50,000,000.00
and property in constructing equaling a value of RMB70,250, 000. 00. Cas h compensation of RMB
50,000,000.00 was received in May 2012. In year 2015, construction properties with a value of
RMB70, 250, 000. 00 were built and delivered, and had been recognized as investment properties (Note V (12)).
The compensation relating the capital expenditure in the reconstruction of the new logistic center in
another place, amounting to RMB93.32 million was recognized as deferred revenue,and would be
amortized and recognized in the income statement within the expected useful lives using the straig ht
line method (Note V(50)), and the other cash compensation.
88
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
35. Other non-current liabilities
30 June 2019 1 January 2019
Contract liabilities 53,375.33 -
Governmental medical reserve funds 45,427,343.31 45,427,343.31
Product promotion accumulative points 22,359,977.45 23,813,832.87
programme
67,840,696.09 69,241,176.18
Cert ain medical reserves funds were received by the Group from the PRC government and local
government for purchasing medical products (including medicines) required to respond to serious
disasters, epidemics and other emergencies.
36. Share capital
Movement during the current year
2019 At beginning of year Issue of new share Others Total At end of year
Shares 428,126,983.00 428,126,983.00
37. Capital surplus
2019 At beginning of year Increase Decrease At end of year
Share premium 2,118,174,787.27 - - 2,118,174,787.27
Significant reorganization 1,173,907,763.19 - - 1,173,907,763.19
Other changes in equity of invested
units under equity method
(94,032,514.34) 42,424,747.00 - (51,607,767.34)
Transfer of capital surplus
recognized under the previous
accounting system 2,650,322.00 - - 2,650,322.00
Business combination involving
enterprises under common control - - - -
Others 1,120,284,623.39 - - 1,120,284,623.39
4,320,984,981.51 42,424,747.00 - 4,363,409,728.51
Capit al surplus-others increased by RMB 42,424,747.00 when other changes in equity of Modern
Pharmaceutical resulted in adjustment of long -term equity investment and an inc reas e of capital
surplus by RMB 42, 424, 747.00 .
89
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
38. Surplus re serve
At beginning of year Increase Decrease At end of year
Surplus reserve 214,063,491.50 - - 214,063,491.50
214,063,491.50 - - 214,063,491.50
39. Retained earnings
30 June 2019 1 January 2019
Retained earnings at the end of the prior year 6,655,257,147.27 5,572,952,806.39
Retained earnings at beginning of year after
retrospective adjustment and restatement 6,655,257,147.27 5,572,952,806.39
Add: Net profit attributable to the parent 650,833,360.40 1,210,742,435.78
Cash dividends payable for ordinary shares 171,250,793.20 128,438,094.90
Others -Business combination involving enterprises under
common control - -
Retained earnings at end of year 7,134,839,714.47 6,655,257,147.27
40. Operating revenue and cost
For the six months ended For the six months ended
30 June 2019 30 June 2018
Revenue Cost Revenue Cost
Principal
operations 25,040,619,938.98 22,398,327,532.43 20,606,027,974.57 18,355,002,752.42
Other
operations 187,527,438.45 17,192,420.44 172,397,627.65 12,640,971.42
25,228,147,377.43 22,415,519,952.87 20,778,425,602.22 18,367,643,723.84
90
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
40. Operating revenue and cost (Continued)
Classification Inter-segment
Headquarters Distribution Retail Total
offsets
By product
Include:
Medicines - 17,951,760,565.22 5,957,083,892.95 (361,359,523.83) 23,547,484,934.34
Medical appliance - 1,345,459,501.68 - - 1,345,459,501.68
Other 4,747,314.83 179,640,288.21 150,815,338.37 - 335,202,941.41
By area
Include:
Domestic sales 4,747,314.83 19,476,860,355.11 6,107,899,231.32 (361,359,523.83) 25,228,147,377.43
Overseas sales - - - - -
By contract
duration
Include:
Confirm revenue
at a certain point
in time - 19,297,220,066.90 5,957,083,892.95 (361,359,523.83) 24,892,944,436.02
Confirm revenue
at a certain time
period 4,747,314.83 179,640,288.21 150,815,338.37 - 335,202,941.41
Total 4,747,314.83 19,476,860,355.11 6,107,899,231.32 (361,359,523.83) 25,228,147,377.43
Information about the Group’s obligations is as follows:
The Group recognises revenue when goods are delivered, and will receive payment within 30-210 days.
The Group recognises revenue after providing services, and will receive payment within 30 -210 days.
The expected revenue recognition time for the Group’s contract obligations above is in year 2019.
Information related to the sales price allocated to the remaining obligations:
The amount of income corresponding to the obligation that has been signed but has not been fulfilled or has
not yet fulfilled is 239,739,020.90 yuan, of which 239,739,020.90 yuan is expected to be recognized in 2019.
91
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
41. Tax and surcharges
For the six month ended For the six month ended
30 June 2019 30 June 2018
City maintenance and construction tax 24,015,771.70 22,352,680.77
Educational surcharge 17,051,137.40 16,112,625.97
Property tax 3,182, 784.83 3,075, 856.41
Land tax 310,374.16 245,070.74
Vehicle and vessel use tax 71,880.95 98,966.20
Stamp duty 17,406,047.59 14,200,426.96
Others 101,229.81 534,900.20
62,139,226.44 56,620,527.25
42. Selling expenses
For the six month ended For the six month ended
30 June 2019 30 June 2018
Employees payroll and welfare benefits 751,390,265.97 659,176,548.69
Rent al expenses 85,603,520.94 322,805,173.33
Trans port ation charges 42,481,965.66 33,086,676.72
Depreciation expenses 313,982,576.03 26,125,384.59
Promotion and mark eting expenses 21,130,375.63 18,454,328.54
Office allowances 19,914,617.62 16,283,197.98
Entertainment expenses 11,670,679.46 11,357,532.12
Storage expenses 15,216,365.97 14,866,861.14
Travel allowances 3,017, 736.94 3,415, 890.36
Market development fees 3,713, 897.19 3,255, 084.76
Conference expenses 1,196, 924.88 1,654, 991.62
Others 214,013,574.44 163,107,086.22
1,483, 332,500.73 1,273, 588,756.07
92
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
43. Admini strative expenses
For the six month ended For the six month ended
30 June 2019 30 June 2018
Employees payroll and welfare benefits 265,705,706.25 248,803,724.84
Rent al expenses 9,155, 207.14 18,347,245.83
Depreciation expenses 16,813,385.90 12,732,380.45
Office allowances 11,183,599.31 11,877,499.56
Amortization of intangible assets 9,779, 109.11 8,272, 613.85
Entertainment expenses 5,822, 240.83 6,428, 775.38
Amortization of long-term deferred expens es 5,532, 926.20 4,518, 905.10
Vehicle management expenses 3,630, 572.81 4,435, 451.82
Travel allowances 3,801, 532.99 4,323, 679.13
Utilities 3,094, 494.34 2,713, 666.76
Taxations 1,847, 691.62 2,241, 415.79
Conference expenses 2,586, 044.56 2,059, 875.35
Repairing fees 2,507, 057.40 1,624, 550.73
Others 35,757,125.67 23,440,279.19
377,216,694.13 351,820,063.78
44. Finance costs
For the six month ended For the six month ended
30 June 2019 30 June 2018
Interest expenses 169,529,472.37 83,356,367.18
Less: Interest income (60,630,036.91) (23,082,233.56)
Cash discount (23,190,566.63) (21,542,580.44)
Exchanges loss/(gain) (389,882.62) 329,665.40
Others 18,776,268.03 18,480,325.74
104,095,254.24 57,541,544.32
45. Other incomes
For the six month ended For the six month ended
30 June 2019 30 June 2018
Government grants relat ed to daily operating
activities 14,974,471.87 10,589,212.57
Taxation service charge refund 16,447.15 741,097.45
14,990,919.02 11,330,310.02
93
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
46. Investment income
For the six month ended For the six month ended
30 June 2019 30 June 2018
Investment income from long-term equity investments
under the equity method 169,142,289.99 162,662,271.35
Dividend income from other equity instruments invested
during the holding period - 31,500.00
169,142,289.99 162,693,771.35
47. Impairment loss on financial assets
For the six month ended For the six month ended
30 June 2019 30 June 2018
Impairment loss of trade receivables (1,666,431.98) (1,172,127.53)
(9,767,669.15) 2,198,829.77
Impairment loss of other receivables
(11,434,101.13) 1,026,702.24
48. Impairment losse s
For the six month ended For the six month ended
30 June 2019 30 June 2018
Inventory provision (125,554.34) (508,849.26)
(125,554.34) (508,849.26)
49. Gain on disposal of a ssets
For the six month ended For the six month ended
30 June 2019 30 June 2018
Gain on disposal of fixed assets (29,725.44) 389,144.70
Gain on disposal of intangible assets - 3,892, 019.91
(29,725.44) 4,281, 164.61
94
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
50. Non-operating income
For the six month For the six month Amount classif ied as
ended ended non-recurring profit or
30 June 2019 30 June 2018 loss
Government grants 1,349,204.28 1,349,204.28 1,349,204.28
Gain from writing off the unnecessary
payment 306,191.87 2,898,512.62 306,191.87
Gain on disposal of non-current assets 195,336.00 2,303.00 195,336.00
Others 1,816,438.10 1,248,931.21 1,816,438.10
3,667,170.25 5,498,951.11 3,667,170.25
Government grants included in current period profit or loss:
Project Name Government Reasons for Type Affects the Special For the six For the six Related to
Department Government profit or subsidy months months asset/income
grants loss of this ended ended
30 June 2019 30 June
year 2018
Resettlement Nanning Subsidy Subsidies from Yes No 1,349,204.28 1,349,204.28 Asset related
Compensation Economic & local government
of No. 7 Technological for support policies
Zhongyao Development such as attracting
Road Area investment
Management
Committee
All non-operating income was wholly classified as non -recurring profit or loss for the six month ended
51. Non-operating expenses
For the six month ended For the six month ended Amount
30 June 2019 30 June 2018 classified as
non-recurring
profit or loss
Donation expenses - 60,000.00 -
Penalty expenses 273,498.60 1,194,388.28 273,498.60
Loss on disposal of a non-
current asset 161,292.34 28,525.01 161,292.34
Others 1,283,474.62 514,379.51 1,283,474.62
1,718,265.56 1,797,292.80 1,718,265.56
95
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
52. Income taxes
For the six month ended For the six month ended
30 June 2019 30 June 2018
Current income tax 183,966,126.67 163,102,979.73
Deferred income tax 8,277,799.83 1,383,754.59
192,243,926.50 164,486,734.32
The reconciliation from income tax calculated based on applicable tax rates and total profit
presented in the consolidated financial statements to the income taxes is listed below:
For the six month ended
30 June 2019
Total profit 960,336,481.81
Income taxes calculated at applicable tax rates 240,084,120.45
Lower tax rates enacted by local authorities (13,265,455.52)
Adjustment of income tax e xpense of previous years (4,574,884.17)
Income not subject to tax (47,995,671.32)
Expenses not deductible for tax 17,747,992.12
Deductible loss on unconfirmed deferred tax assets at end of the
period 493,231.44
Impact of the temporary discrepancy on unconfirmed deductible
deferred tax assets at end of the period (255,667.65)
Impact of the temporary discrepancy on unconfirmed deductible
deferred tax assets of the pervious year 10,261.15
Income tax 192,243,926.50
96
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
53. Note s to items in the cash flow statement
(a) Cash receipts related to other operating activities
For the six months ended For the six months ended
30 June 2019 30 June 2018
Government grants except tax return 16,340,011.49 10,345,223.64
Rent income 37,910,253.81 37,793,728.50
Received operational restricted bank deposits 123,321,063.70 88,156,799.79
Interest income 60,227,651.15 22,642,258.30
Others 57,683,231.05 153,046,777.37
295,482,211.20 311,984,787.60
(b) Cash paid relating to other operating activities
For the six months ended For the six months ended
30 June 2019 30 June 2018
Rental expenses 94,758,728.08 341,152,419.16
Entertainment expenses 17,492,920.29 17,786,307.50
Trans port ation charges 42,481,965.66 33,086,676.72
Travel expenses 6,819,269.93 7,739,569.49
Storage expenses 15,216,365.97 14,866,861.14
Office expenses 31,098,216.93 28,160,697.54
Ad vertising expenses 21,130,375.63 18,454,328.54
Others 265,893,688.82 377,222,116.67
494,891,531.31 838,468,976.76
(c) Cash received relating to other investing activities
For the six months ended For the six months ended
30 June 2019 30 June 2018
Received entrusted loan payments 44,000,000.00
Received funds of acquiring Sinopharm
4,680,000.00
Huadu
Others 86,145.15
- 48,766,145.15
97
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
53. Note s to items in ca sh flow statement (Continued)
Cash paid relating to ot her investing
(d)
activities
For the six months ended For the six months ended
30 June 2019 30 June 2018
Entrusted borrowings paid to Zhijun Suzhou - 43,999,800.00
Others 1,093,125.00 -
1,093,125.00 43,999,800.00
Cash received relating to other
(e)
financing activities
For the six months ended For the six months ended
30 June 2019 30 June 2018
Financing restricted monetary funds 3,512,659.71 79,825,164.60
received
Others - 3,920,000.00
3,512,659.71 83,745,164.60
Cash payments relating to other
(f)
financing activities
For the six months ended For the six months ended
30 June 2019 30 June 2018
Bank factoring payable 174,269,120.18 64,002,739.23
Lease payment 299,173,550.25 -
Purchase of equity of minority shareholders - 54,722,980.00
Others 36,719,497.31 -
510,162,167.74 118,725,719.23
98
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
54. Supplementary information of cash flow statement
(a) Reconciliation of net profit to cash flows from operating activities
For the six month ended For the six month ended
30 June 2019 30 June 2018
Net profit 768,092,555.31 689,249,009.91
Adjustments: Provision for asset impairment 11,559,655.47 (506,814.18)
Depreciation of fixed assets and investment
properties 48,917,181.72 38,366,126.42
Amortization of intangible assets 14,808,363.43 11,832,914.62
Amortization of long-term prepaid expenses 50,607,272.62 41,638,297.62
Gains on disposal of fixed assets, and other
non-current assets 131,566.90 (4,254,942.60)
Finance costs 159,266,607.86 82,449,854.36
Investment income (169,142,289.99) (162,693,771.35)
Increase in deferred tax assets 5,674,224.55 3,402,744.73
(Increase)/decrease in deferred tax liabilities 2,603,575.28 (2,018,990.14)
(Increase)/decrease in inventories (492,796,771.41) (463,324,117.97)
Increase in operating receivables items (1,983,255,213.04) (1,298,602,834.11)
(Decrease)/increase in operating payable
items 2,463,112,034.51 1,170,553,090.12
Others 284,178,818.14 119,267,141.77
Net cash generated from operating activities 1,163,757,581.35 225,357,709.20
99
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
54. Supplementary information of cashflow statement (Continued)
(b) Movement of cash
For the six months ended For the six months ended
30 June 2019 30 June 2018
Cash at the end of the period 7,768, 974,878.91 3,592, 715,787.37
Less: Cash at the beginning of the period 7,632, 117,020.77 3,673, 498,691.48
Net increase in cash 136,857,858.14 (80,782,904.11)
(c) Cash
30 June 2019 31 December 2018
Cash 7,768, 974,878.91 7,632, 117,020.77
Incl: Cash on hand 3,415, 085.25 5,587, 191.18
Bank deposits on demand 7,765, 559,793.66 7,626, 529,829.59
Ending banlance cash and
cash equivalent 7,768, 974,878.91 7,632, 117,020.77
55. Note s to changes in shareholders’ equity
The current capital reserve -“Other” increased by RMB 42,424,747.00 when ot her changes in equity of
Shyndec Pharma resulted in adjustment of long-term equity investment and an increase of capital surplus
amounting to RMB 42,424,747.00.
100
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
56. Assets under restricted ownership or right of use
Book value Reas ons
Deposits of bank acceptance notes,
Cash and cash equivalents 317,353,629.58 depostis for letter of credit and others.
notes receivable discounted but not
Notes rec eivables 211,316,836.99 due
528,670,466.57
Note 1: At 30 June 2019, the Group had deposits of bank acceptance notes and letter of credit deposit
amounting to RMB317,353,629.58 (31 December 2018: RMB457,664,283.79) (Note V(1)); the deposit of
bank acceptance bill is RMB317,047,823.58, the letter of credit deposit is RMB305,806.00.
Note 2: At 30 June 2019, the Group had notes receivable of RMB211,316,836.99, discounted but not due (31
December 2018: RMB170,013,427.11) (Note V (2)).
Note 3: At 30 June 2019, the Group had notes receivable of RMB 0, endorsed but not due (31 December
2018: 301,416.00) (Note V (2)).
57. Government grants
Type Included in current
Amount Account title
period profit or loss:
2017 Key enterprise development award funds Other incomes
3,166,380.00 3,166,380.00
of Liw an Distric t, Guangzhou
2018 Hundreds of enterpris es reward funds of
310,824.00 Other incomes 310,824.00
Chancheng District, Foshan City
Third party drug modern logistics public
9,400.20 Other incomes 9,400.20
information platform
2013 Guangzhou subsidies for headquarters 264,841.74 Other incomes 264,841.74
Guangzhou special subsidy for the
construction of research and development 44,705.94 Other incomes 44,705.94
institutions
Guangzhou special subsidy for commerce and
241,440.44 Other incomes 241,440.44
trade circulation industry
101
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
57. Government grants (Continued)
Liw an Distric t Sinopharm Supply Chain
Engineering Technology Research and 11,598.84 Other incomes 11,598.84
Development Center
Medical Smart Supply Chain E-commerce
21,884.52 Other incomes 21,884.52
Service Platform Technology Project
Input tax 10% deduction Other incomes/
406,083.20 369,265.69
Deferred income
Office rent subsidy 102,415.76 Other incomes 102,415.76
Centralized financial subsidy fund for
comprehensiv e pilot w ork of modern servic e 150,000.00 Other incomes 150,000.00
industry
Guangdong Provincial Science and
Technology Bureau's grant for the "Smart 17,011.65 Other incomes 17,011.65
Supply Chain Project"
Guangzhou Logistic s Standardization Pilot
273,123.42 Other incomes 273,123.42
Project
Industrial application project of pharmaceutical
12,499.98 Other incomes 12,499.98
cold chain patent incubator
Key enterprises support rewards of Liw an
60,800.00 Other incomes 60,800.00
District, Guangzhou
Employment subsidy 619,679.48 Other incomes 619,679.48
Statistical work subsidy 10,000.00 Other incomes 10,000.00
Nanning logistics project construction support
93,203.22 Other incomes 93,203.22
fund
Business bureau award 50,000.00 Other incomes 50,000.00
Business enterprise support reward 300,000.00 Other incomes 300,000.00
Modern logistics cold chain integration
30,000.00 Other incomes 30,000.00
monitoring platform project
Medical w arehousing center logistic s
71,428.56 Other incomes 71,428.56
information platform project
Modern pharmaceutical logistics remote
35,714.28 Other incomes 35,714.28
location construction project
Industrial transformation and upgrading special
179,112.66 Other incomes 179,112.66
funds
102
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
V Notes to the consolidated financial statements (Continued)
57. Government grants (Continued)
Quarterly growth award for special funds for
150,000.00 Other incomes 150,000.00
industrial development
Subsidies for the employment of disabled
18,257.35 Other incomes 18,257.35
persons
Futian district modern servic e industry
300,000.00 Other incomes 300,000.00
quarterly growth award
Special funds for business development 50,000.00 Other incomes 50,000.00
2018 finance bureau subsidy of Putuo district 1,430,000.00 Other incomes 1,430,000.00
Key enterprises support funds of Putuo distric t 483,143.05 Other incomes 483,143.05
Futian District Industrial Development Special
700,000.00 Other incomes 700,000.00
Fund Award
Gulou District Tax Subsidy 130,000.00 Other incomes 130,000.00
Small-scale taxpayers are exempt from VAT 2,310,639.30 Other incomes 2,310,639.30
Tianjin Heping District Business Committee
5,600.00 Other incomes 5,600.00
Award
Shenyang City Service Development Special
2,000,000.00 Other incomes 2,000,000.00
Fund Subsidy
tax return form Dalian 682,221.79 Other incomes 682,221.79
Weidong District Tax Rew ard 100,000.00 Other incomes 100,000.00
Yangpu Distric t SME Development Special
169,000.00 Other incomes 169,000.00
Fund
Tax system servic e fee refund 280.00 Other incomes 280.00
Subsidy of electric vehic le 39,619.95 Deferred income
Resettlement Compensation of No. 7 Zhongyu Non-operating
1,349,204.28 1,349,204.28
Road income
Shenzhen Futian District Development Service
Financial
Center District Industrial Development Special 133,300.00 133,300.00
expenses
Fund Loan Discount
103
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VI. Changes in scope of consolidation
1. Changes in scope of consolidation for other reasons
Establishment of subsidiaries:
For the six months ended 30
30 June 2019 June 2019
Net assets Net profits
Sinopharm Holding Guoda Bayannaoer Co., Ltd.(a) 20,071,010.09 71,010.09
Inner Mongolia Guoda Pharmaceutical Co., Ltd.(b) 19,435,858.10 (564,141.90)
Sinopharm Holding Guoda Yongxingtang Chain
(Chaoyang) Co., Ltd.(c) 21,362,985.84 162,985.84
a. On 18 November 2018, the Group and Hohhot Manshengyuan Trading Co., Ltd. set up
Sinopharm Holding Guoda Bayannaoer Co., Ltd. registered capital subscribed RMB
16,000,000.00 and RMB 4,000,000.00 respctively. In January 2019, the Group and minority
shareholders completed the capital contribution.The Group holds 80% of its equity after the
completion。
b. On 22 October 2018, The Group wholly-owned Inner Mongolia Guoda Pharmaceutical Co., Ltd.,
with a registered capital of RMB 20 million., and completed capital contribution in February 2019.
c. On 30 April 2019, the Group and Chaoy ang Bowei Consulting Service Co., Ltd. set up
Sinopharm Holding Guoda Yongxingtang Chain (Chaoyang) Co., Ltd., registered capital
subscribed RMB 19, 380,000.00 and RMB 18,620,000.00 respctively. In June 2019, the Group
and the minority shareholders contributed RMB 6,528,000.00 and RMB 6,272,000.00
respectively. The Group holds 51% of its equity after the completion。
104
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII Interests in other entities
1． Interests in subsidiaries
(1) The composition of the Group:
Principal place of Place of Nature of Shareholding
Subsidiaries Ways of acquisition
business incorporation business Direct Indirect
Sinopharm Guilin Guilin Guilin Commercial - 100% Establishment
Sinopharm Baise Baise Baise Commercial - 100% Establishment
Sinopharm Holding
Zhongshan Co.,
Ltd.(hereafter
ref ered
as"Sinopharm
Zhongshan") Zhongshan Zhongshan Commercial - 100% Establishment
Sinopharm Guigang Guigang Guigang Commercial - 100% Establishment
Sinopharm Beihai Beihai Beihai Commercial - 100% Establishment
Sinopharm Holding
Guangzhou Medical
Treatment Guangzhou Guangzhou Commercial - 51% Establishment
Sinopharm Holding
Shenzhen Jianmin Business
Co., Ltd.(hereafter combinations
ref ered inv olving entities
as"Sinopharm under common
Jianmin") Shenzhen Shenzhen Commercial 100% - control
Sinopharm Holding
Shenzhen
Traditional & Herbal
Medicine Co., Ltd. Business
(hereafter referd as combinations
“Sinopharm inv olving entities
Traditional & Herbal under common
Medicine") Shenzhen Shenzhen Commercial 100% - control
Sinopharm Holding
Shenzhen Logistics Business
Co., Ltd. (hereafter combinations
ref ered inv olving entities
as“Shenzhen under common
Logistics") Shenzhen Shenzhen Serv ices 100% - control
Sinopharm Holding Business
Guangzhou Co., Ltd. combinations
(hereafter refered inv olving entities
as“Sinopharm under common
Guangzhou") Guangzhou Guangzhou Commercial 100% - control
Sinopharm Holding
Guangdong Business
Hengxing Co., Ltd. combinations
(hereafter refered inv olving entities
as“Sinopharm under common
Hengxing") Guangzhou Guangzhou Commercial - 100% control
Business
combinations
inv olving entities
under common
Sinopharm Y ulin Y ulin Y ulin Commercial - 100% control
105
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
(1) The composition of the Group (Continued):
Shareholdi ng
Principal pl ace Place of Nature of
Subsidi aries Ways of acquisition
of business incorporation business Direct Indirect
Business combi nations
Sinophar m Li uzhou Liuzhou Liuzhou Commercial - 51% involvi ng entiti es under
common control
Business combi nations
Guangdong Hui xin Investment involvi ng entiti es under
Co., Ltd. (“Hui xin Inves tment”) Guangzhou Guangzhou Servic e 100.00% common control
Business combi nations
Sinophar m Holdi ng Foshan Co., involvi ng entiti es under
Ltd. (“Sinophar m Fos han") Foshan Foshan Commercial 100.00% common control
Sinophar m Holdi ng Guangdong Business combi nations
Yuexing Co., Ltd. (“Sinophar m involvi ng entiti es under
Yuexing”) Guangzhou Guangzhou Commercial 100.00% common control
Sinophar m Holdi ng Guangdong Business combi nations
Logistics Co., Ltd. involvi ng entiti es under
(“Guangdong Logistic”) Guangzhou Guangzhou Servic e 100.00% common control
Business combi nations
involvi ng entiti es under
Sinophar m Guangxi Nanning Nanning Commercial 100.00% common control
Business combi nations
involvi ng entiti es under
Guangxi Logistic Nanning Nanning Servic e 100.00% common control
Business combi nations
involvi ng entiti es under
Sinophar m Wuzhou Wuzhou Wuzhou Commercial 99.90% common control
Business combi nations
involvi ng entiti es under
Sinophar m Dongguan Dongguan Dongguan Commercial 100.00% common control
Business combi nations
involvi ng entiti es under
Sinophar m Zhanjiang Zhanjiang Zhanjiang Commercial 100.00% common control
Business combi nations
involvi ng entiti es under
Sinophar m Yanfeng Shenzhen Shenzhen Commercial 51.00% common control
Business combi nations
involvi ng entiti es under
Sinophar m Meizhou Meizhou Meizhou Commercial 100.00% common control
Business combi nations
involvi ng entiti es under
Sinophar m Huizhou Huizhou Huizhou Commercial 100.00% common control
Business combi nations
involvi ng entiti es not under
Sinophar m Zhaoqing Zhaoqing Zhaoqing Commercial - 100% common control
Business combi nations
involvi ng entiti es not under
Sinophar m Jiangmen（a） Jiangmen Jiangmen Commercial - 100% common control
Business combi nations
involvi ng entiti es not under
Sinophar m Shaoguan Shaoguan Shaoguan Commercial - 70% common control
Sinophar m Holdi ng Shantou C o., Business combi nations
Ltd.(hereafter refered involvi ng entiti es not under
as"Sinopharm Shantou”) Shantou Shantou Commercial - 100% common control
Business combi nations
involvi ng entiti es under
Foshan Nanhai Medicine Co., Ltd. Foshan Foshan Commercial - 100% common control
Business combi nations
Foshan Nanhai Uptodate & involvi ng entiti es under
Special M edicines Co., Ltd. Foshan Foshan Commercial - 100% common control
Business combi nations
involvi ng entiti es under
Foshan Nanhai Medicine Co., Ltd. Foshan Foshan Commercial - 100% common control
Business combi nations
Guangdong Uptodate & Special involvi ng entiti es under
Medicines Guangzhou Guangzhou Commercial - 100% common control
Business combi nations
Guangdong South Phar mac eutic al involvi ng entiti es under
Foreign Trade C o., Ltd. Guangzhou Guangzhou Commercial - 100% common control
Sinophar m Holdi ng Zhuhai Co., Business combi nations
Ltd. ( (hereafter referd as involvi ng entiti es not under
“Sinopharm Zhuhai") Zhuhai Zhuhai Commercial - 100% common control
106
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
(1) The composition of the Group (Continued):
Principal pl ace Nature of Shareholdi ng
Place of
Subsidi aries Ways of acquisition
of business incorporation business Direct Indirect
Sinophar m Holdi ng Maoming Co., Business combi nations
Ltd. ( (hereafter referd as involvi ng entiti es not under
“Sinopharm Maoming") Maoming Maoming Commercial - 100% common control
Sinophar m Holdi ng GZ Medical
Technology Co., Ltd. Guangzhou Guangzhou Commercial - 51% Establishment
Sinophar m Holdi ng GZ Medical
Supply Chai n Servic e Co., Ltd. Guangzhou Guangzhou Commercial - 51% Establishment
Sinophar m Holdi ng Heyuan Co., Business combi nations
Ltd. ( (hereafter referd as involvi ng entiti es not under
“Sinopharm Heyuan") Heyuan Heyuan Commercial - 70% common control
Business combi nations
Sinophar m Holdi ng Guoda involvi ng entiti es under
Phar mac y Co., Ltd. Shanghai Shanghai Commercial 60% - common control
Sinophar m Holdi ng Guoda Business combi nations
Phar mac y Chain Stor e involvi ng entiti es under
Shanghai Co., Ltd. Shanghai Shanghai Commercial - 100% common control
Business combi nations
Beijing Guoda Pharmac y Chai n involvi ng entiti es under
Store C o., Ltd. Beijing Beijing Commercial - 100% common control
Business combi nations
Tianjin Guoda Phar mac y C hain involvi ng entiti es under
Store C o., Ltd. Tianjin Tianjin Commercial - 80% common control
Guangxi Guoda Pharmac y Business combi nations
Consulting Chain Store Co., involvi ng entiti es under
Ltd. Nanning Nanning Commercial - 100% common control
Sinophar m Holdi ng Guoda Business combi nations
Phar mac y Guangdong Co., involvi ng entiti es under
Ltd. Shenzhen Shenzhen Commercial - 100% common control
Business combi nations
Sinophar m Guoda Phar mac y involvi ng entiti es under
Guangxi Chain Co., Ltd. Liuzhou Liuzhou Commercial - 100% common control
Business combi nations
Zhejiang Guoda Phar mac y C o., involvi ng entiti es under
Ltd. Hangzhou Hangzhou Commercial - 100% common control
Sinophar m Holdi ng Guoda
Yangzhou D ades heng Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Yangzhou Yangzhou Commercial - 93.68% common control
Business combi nations
Ningxia Guoda Phar mac y C hain involvi ng entiti es under
Store C o., Ltd. Yinchuan Yinchuan Commercial - 70% common control
Sinophar m Holdi ng Guoda Nanjing Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Nanjing Nanjing Commercial - 60% common control
Sinophar m Holdi ng Guoda Business combi nations
Shandong Pharmac y Chain involvi ng entiti es under
Store C o., Ltd. Linyi Linyi Commercial - 55% common control
Sinophar m Holdi ng Guoda Business combi nations
Shenyang Pharmac y Chain involvi ng entiti es under
Store C o., Ltd.(b) Shenyang Shenyang Commercial - 51% common control
Business combi nations
Fujian Guoda Pharmac y Chain involvi ng entiti es under
Store C o., Ltd.(c) Xiamen Xiamen Commercial - 100% common control
Business combi nations
Anhui Guoda Phar mac y Chain involvi ng entiti es under
Store C o., Ltd. Hefei Hefei Commercial - 60% common control
Business combi nations
Quanzhou Guoda Pharmac y involvi ng entiti es under
Chain Store C o., Ltd. Quanzhou Quanzhou Commercial - 51% common control
Business combi nations
Shanxi Guoda Wanmin Pharmac y involvi ng entiti es under
Chain Store C o., Ltd. Taiyuan Taiyuan Commercial - 85% common control
Sinophar m Holdi ng Hunan Guoda Business combi nations
Minshengtang Pharmac y involvi ng entiti es under
Chain Co., Ltd. Hengyang Hengyang Commercial - 51% common control
Business combi nations
Liyang Guoda People Phar mac y involvi ng entiti es under
Chain Store C o., Ltd. Liyang Liyang Commercial - 80% common control
Sinophar m Holdi ng Guoda Henan Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Pingdingshan Pingdingshan Commercial - 60% common control
107
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
(1) The composition of the Group (Continued):
Principal pl ace Nature of Shareholdi ng
Place of
Subsidi aries Ways of acquisition
of business incorporation business Direct Indirect
Sinophar m Holdi ng Guoda Inner Business combi nations
Mengdia Phar mac y Chain involvi ng entiti es under
Store C o., Ltd. Hohhot Hohhot Commercial - 96.7% common control
Sinophar m Hebei Lerentang Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Shijiazhuang Shijiazhuang Commercial - 60% common control
Business combi nations
Sinophar m Guoda Phar mac y involvi ng entiti es under
Jiangmen Chain Co., Ltd. Jiangmen Jiangmen Commercial - 65% common control
Sinophar m Holdi ng Guoda Shanxi Business combi nations
Yiyuan Pharmac y Chain Store involvi ng entiti es under
Co., Ltd. Taiyuan Taiyuan Commercial - 80% common control
Sinophar m Holdi ng Xinjiang New Business combi nations
& Special Medicines C hain involvi ng entiti es under
Store C o., Ltd. Urumqi Urumqi Commercial - 51% common control
Business combi nations
Sinophar m Holdi ng Guoda ForMe involvi ng entiti es under
Medicines (Shanghai) Co., Ltd. Shanghai Shanghai Commercial - 97% common control
Sinophar m Holdi ng Guoda ForMe
Phar mac y Chain Stor e Co.,
Ltd. (Formerl y “Shanghai Business combi nations
ForMe YiXing Pharmac y Chain involvi ng entiti es under
Store C o., Ltd.”) Shanghai Shanghai Commercial - 99.76% common control
Beijing Golden Elephant Phar mac y Business combi nations
Medicine Chain C ompany involvi ng entiti es under
Limited Beijing Beijing Commercial - 53.13% common control
Business combi nations
Shanxi Tongfeng Pharmac y involvi ng entiti es under
Logistics Co., Ltd. Taiyuan Taiyuan Commercial - 100% common control
Changzhi Guoda Wanmi n Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Changzhi Changzhi Commercial - 51% common control
Business combi nations
Shanxi Guoda Wanmin Clinic involvi ng entiti es under
Management Chain Co., Ltd. Taiyuan Taiyuan Medical ser vices - 100% common control
Business combi nations
Shanghai Guoda Shanghong involvi ng entiti es under
Qibao Pharmac y Co., Ltd. Shanghai Shanghai Commercial - 51% common control
Business combi nations
Zhejiang Intlmedicine Pharmac y involvi ng entiti es under
Dongshan Co., Ltd. Hangzhou Hangzhou Commercial - 51% common control
Business combi nations
Shanghai Guoda D ongsheng involvi ng entiti es under
Phar mac y Co., Ltd. Shanghai Shanghai Commercial - 100% common control
Business combi nations
Sinophar m Guoda Drug Store involvi ng entiti es under
(Shenz hen) Chai n Co., Ltd. Shenzhen Shenzhen Commercial - 100% common control
Sinophar m Holdi ng Guoda Business combi nations
Phar mac y Guangzhou Chain involvi ng entiti es under
Co., Ltd. Guangzhou Guangzhou Commercial - 100% common control
Shanghai Guodong Chines e Business combi nations
Traditional Medicine Clinic Co., involvi ng entiti es under
Ltd. Shanghai Shanghai Medical clinic - 100% common control
Shanghai Guoda D ongxi n Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Shanghai Shanghai Commercial - 100% common control
Shanghai Yutaitang Chi nese Business combi nations
Traditional Medicine Clinic Co., involvi ng entiti es under
Ltd. Shanghai Shanghai Commercial - 100% common control
Business combi nations
Sanhe Li yang Golden Elephant involvi ng entiti es under
Phar mac y Co., Ltd. Langfang Langfang Commercial - 100% common control
Xiaoyi Guoda Wanmi n Baicaotang Business combi nations
Phar mac y Chain Stor e Co., involvi ng entiti es under
Ltd. Xiaoyi Xiaoyi Commercial - 70% common control
Business combi nations
Sinophar m Holdi ng Guoda involvi ng entiti es under
Phar mac y Hul un Buir Co., Ltd. Hulun Buir Hulun Buir Commercial - 51% common control
Business combi nations
involvi ng entiti es under
ForMe Xuhui Shanghai Shanghai Commercial - 100% common control
Sinophar m Holdi ng Ulanqab C o.,
Ltd. Ulanqab Ulanqab Commercial - 60% Establishment
108
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
(1) The composition of the Group (Continued):
Principal pl ace Nature of Shareholdi ng
Place of
Subsidi aries Ways of acquisition
of business incorporation business Direct Indirect
Business combi nations
Sinophar m Guoda Phar mac y involvi ng entiti es under
Qinhuangdao C hain C o., Ltd. Qinhuangdao Qinhuangdao Commercial - 51% common control
Taishan Sinopharm Holding Business combi nations
Guoda Qunkang Phar mac y involvi ng entiti es under
Chain Store C o., Ltd. Taishan Taishan Commercial - 70% common control
Business combi nations
Beijing Golden Elephant Fuxi ng involvi ng entiti es under
Technology Co., Ltd. Beijing Beijing Commercial - 80% common control
Business combi nations
Sinophar m Lerentang involvi ng entiti es under
Shijiazhuang Phar mac eutical Shijiazhuang Shijiazhuang Commercial - 100% common control
Sinophar m Holdi ng Guoda Drug
Store Manchuria Co., Ltd. Manchuria Manchuria Commercial - 51% Establishment
Sinophar m Guoda Drug Store
Anshan C hain Co., Ltd. Anshan Anshan Commercial - 51% Establishment
Sinophar m Holdi ng Guoda
Yongsheng Drug Store
（Shanghai） Co., Ltd. Shanghai Shanghai Commercial - 55% Establishment
Sanhe Li xin Golden El ephant
Drugstore Co., Ltd. Langfang Langfang Commercial - 100% Establishment
Sinophar m Holdi ng Foshan
Medical Cons umables Supply
Chain Co., Ltd. Foshan Foshan Commercial - 70% Establishment
Sinophar m Holdi ng Medical
Supply Chai n Servic e
(Guang xi) Co., Ltd. Nanning Nanning Commercial - 30.06% Establishment
Shanghai Guoda H aohai
Phar mac y Co., Ltd. Shanghai Shanghai Commercial - 51% Establishment
Sinophar m Holdi ng Bai yi
Phar mac y Guangxi C o., Ltd. Nanning Nanning Commercial - 51% Establishment
Sinophar m Holdi ng Hezhou Co.,
Ltd. Hezhou Hezhou Commercial - 100% Establishment
Sinophar m Holdi ng National
Phar mac y Z hengzhou Chain
Co., Ltd. Zhengzhou Zhengzhou Commercial - 60% Establishment
Shanghai Guoda R uijing
Phar mac y Co., Ltd. Shanghai Shanghai Commercial - 55% Establishment
Fujian Guoda Pharmac eutic al Co.,
Ltd. Xiamen Xiamen Commercial - 100% Establishment
Sinophar m Holdi ng Qinzhou C o.,
Ltd. Qinzhou Qinzhou Commercial - 100% Establishment
Sinophar m Holdi ng Hechi Co., Ltd. Hechi Hechi Commercial - 100% Establishment
Business combi nations
Sinophar m Holdi ng Guangzhou involvi ng entiti es not under
Huadu Co., Ltd. Guangzhou Guangzhou Commercial - 70% common control
Business combi nations
Sinophar m Holdi ng Guoda Shanxi involvi ng entiti es not under
Phar maceutical C o., Ltd.(d) Taiyuan Taiyuan Commercial - 100% common control
Business combi nations
Taiyuan Tong xinli Guoda involvi ng entiti es not under
Phar mac y Co., Ltd. Taiyuan Taiyuan Commercial - 100% common control
Sinophar m Holdi ng Guoda
Bayannaoer Co., Ltd.(e) a Bayannaoer a Bayannaoer Commercial - 80% Establishment
Inner Mongolia Guoda
Phar maceutical C o., Ltd.(f) Hohhot Hohhot Commercial - 100% Establishment
Sinophar m Holdi ng Guoda
Yong xingtang Chain
(Chaoyang) Co., Ltd.(g) Chaoyang Chaoyang Commercial - 51% Establishment
VII Interests in other entities(Continued)
109
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
1． Interests in subsidiaries(Continued)
(1) The composition of the Group(Continued)
a. On 13 March 2019, Sinopharm Jiangmen was renamed as “Sinopharm Holding (Jiangmen) Co., Ltd.”.
b. Sinopharm Holding Guoda Shenyang Pharmacy Chain Store Co., Ltd increased the registered capital by
RMB32,000,000.00 with undistributed profits. After the capital increased, the registered capital of Shenyang
Guoda increased from RMB18,000,000.00 to RMB 50,000,000.00, and the shareholding ratio of the original
shareholders did not change.
c. On 17 April 2019, the shareholder of Fujian Guoda Pharmacy Chain Store Co., Ltd. Changed from Sinopharm
Holding Guoda Pharmacy Co., Ltd. to Fujian Guoda Pharmaceutical Co., Ltd. by internal transfer. The 1 00%
equity of Fujian Guoda Chain held by the original shareholder Sinopharm Holding Guoda Pharmacy Co., Ltd.
was transferred to Fujian Guoda Pharmaceutical Co., Ltd.
d. On 1 February 2019, Shanxi Zhongao Pharmaceutical Co., Ltd. was renamed as “Sinopharm Hold ing Guoda
Shanxi Pharmaceutical Co., Ltd.”.
e. On 5 November 2018, the Group and Hohhot Manshengyuan Trading Co., Ltd. set up Sinopharm Holding
Guoda Bayannaoer Co., Ltd. registered capital subscribed RMB 16,000,000.00 and RMB 4,000,000.00
respctively. In January 2019, the Group and minority shareholders completed the capital contribution.The
Group holds 80% of its equity after the completion.
f. On 22 October 2018, the Group wholly-owned Inner Mongolia Guoda Pharmaceutical Co., Ltd., with a
registered capital of RMB 20 million., and completed capital contribution in February 2019.
g. On 30 April 2019, the Group and Chaoyang Bowei Consulting Service Co., Ltd. set up Sinopharm Holding
Guoda Yongxingtang Chain (Chaoyang) Co., Ltd., registered capital subscribed RMB 19,380,000.00 and RMB
18,620,000.00 respctively. In June 2019, the Group and minority shareholders contributed RMB 6,528,000.00
and RMB 6,272,000.00 respectively. The Group holds 51% of its equity after the completion 。
110
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII. Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
(1) Important non-wholly owned subsidiary
Subsidiaries Minority Profit or loss Dispatch of dividends Minority shareholders'
shareholding ratio attributable to minority to minority equity
shareholders in the shareholders in the
current period current period
Sinopharm Holding Guoda
Pharmacy Co., Ltd. 40.00% 60,082,149.76 1,743,715,207.60
(2) Key financial information of important non -wholly owned subsidiaries
30 June 2019 31 December 2018
Subsidiaries Non-current Current Non-current Non-current Current Non-current
Current assets T otal assets T otal liabilities Current assets T otal assets T otal liabilities
assets liabilities liabilities assets liabilities liabilities
Sinopharm
Holding Guoda
7,637,323,815 .74 3,210,489,588 .58 10,847,813,404 .32 4,642,692,689 .21 1,027,988,905 .69 5,670,681,594 .90 7,467,662,962 .46 1,567,755,313 .41 9,035,418 ,275.87 3,994,471,884 .62 64,729,132.20 4,059,201,016 .82
Pharmacy Co.,
Ltd.
For the six months ended 30 June 2019 For the six months ended 30 June 2018
Subsidiaries T otal comprehensive Cash flow from T otal comprehensive Cash flow from
Operating revenue Net profit Operating revenue Net profit
income operating activities income operating activities
Sinopharm Holding
Guoda Pharmacy Co., 6,107,899,231.32 186,189,865.75 186,189,865.75 545,455,740.77 5,143,601,636.87 172,985,004.03 172,985,004.03 77,797,706.43
Ltd.
111
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII. Interests in other entities (Continued)
2. Interests in a ssociates
Principal place Place of Nature of Shareholding(%)
of business incorporation business Accounting
Direct Indirect
Associates
Shenzhen Main Luck
Pharmaceutical Co., Ltd.
(hereafter referd as"Main
Luck Pharmaceutical ") Shenzhen Shenzhen Manufacturing 35.19% - Equity
Sinopharm Group
Zhijun(Suzhou)
Pharmaceutical Co., Ltd. Suzhou Suzhou Manufacturing 33.00% - Equity
Si nopharm Group
Zhij un(Shenzhen)
Pharmaceuti cal Co., Ltd. Shenzhen Shenzhen Manufacturing 49.00% - Equity
Shenzhen Zhij un Pharmaceuti cal
Trade Co., Ltd. Shenzhen Shenzhen Commercial 49.00% - Equity
Si nopharm Group
Zhij un(Shenzhen) Pi ngshan
Pharmaceuti cal Co., Ltd. Shenzhen Shenzhen Manufacturing 49.00% - Equity
Shanghai Shyndec
Pharmaceutical Co., Ltd.
(hereafter referd as
“Shyndec Pharmaceutical”) Shanghai Shanghai Manufacturing 16.28% - Equity
Shanghai Dingqun Enterprise
Management Consulting
Co., Ltd.(hereafter refered Business service
as “Shanghai Dingqun”) Shanghai Shanghai industry 2.53% - Equity
Shanghai Beiyi Guoda
pharmaceutical Co. Ltd. Shanghai Shanghai Commercial - 26.00% Equity
Shanghai Liyi Pharmacy Co.,
Ltd Shanghai Shanghai Commercial - 35.00% Equity
Sinopharm Jienuo Medical
Treatment Service
Guangdong Co., Ltd. Guangzhou Guangzhou Commercial - 29.00% Equity
112
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII. Interests in other entities (Continued)
2. Interests in associate s (Continued)
Principal
Nature of
place of Place of business Shareholding(%)
business incorporation Accounting
Direct Indirect
Associates
Dongyuan accord
pharmaceutical chain Co.,
Ltd. Heyuan Heyuan Commercial - 45.00% Equity
Guangdong Jianhui
Construction Investment
Management Co.,
Ltd.(hereafter refered as Public-Private-
“Guangdong Jianhui”) Zhanjiang Zhanjiang Partnership - 10.00% Equity
Shanghai Renbei Pharmacy
Co., Ltd. Shanghai Shanghai Commercial - 30.00% Equity
Explication of the shareholding ratio of a joint venture differs from the proportion of voting rights:
The basis that holds less than 20% of the voting rights but has a significant impact, or holds 20% or
more of the voting rights but has no significant impact:
(1) The highest authority of Shanghai Dingqun is the shareholders' meeting, and the shareholders
exercise their voting rights according to the proportion of capital contribution. At the same time,
Shanghai Dingqun has set up a board of directors which is responsible for the shareholders'
meeting. The board consists of three members, of which the company has appointed one
director. The vote on the board's resolution is one vote per person, and all the board
resolutions should be passed by more than half of all directors.
(2) The highest authority of Guangdong Jianhui is the shareholders' meeting, and the shareholders
exercise their voting rights according t o the proportion of the capital contribution. At the same
time, Guangdong Jianhui set up a board of directors whic h is responsible for the shareholders'
meeting. The board consists of five members, of which the company has appointed one director.
The vote on the resolution of the board of directors is one vote per person.
113
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VII. Interests in other entities (Continued)
3. Summarised financial information of signi ficant associate
30 June 2019/ For the six months 1 January 2019/ For the six months
ended 30 June 2019 ended 30 June 2018
Shanghai Shyndec Shanghai Shyndec Pharmaceutical
Pharmaceutical Co., Ltd. Co., Ltd.
Current assets 10,502,009,120.54 8,470,191,403.19
Non-current assets 7,879,885,410.94 7,993,673,189.70
Total assets 18,381,894,531.48 16,463,864,592.89
Current liabilities 7,111,735,949.12 6,568,480,863.79
Non-current liabilities 2,323,172,902.37 1,452,099,931.65
Total liabilities 9,434,908,851.49 8,020,580,795.44
Non-controlling interests 1,616,396,132.89 1,637,029,480.44
Shareholders’ equity attributable to
7,330,589,547.10 6,806,254,317.01
shareholders of the parent
Portion of net assets calc ulated by
1,189,353,675.16 1,098,566,852.51
shareholding ratio
Carrying value of equity investment in
1,189,353,675.16 1,098,566,852.51
joint ventures
Operating revenue 6,255,380,073.90 5,853,255,169.05
Net profit 525,814,658.05 575,258,204.58
Total comprehensive income 525,814,658.05 575,258,204.58
Dividends receiv ed from joint ventures
16,896,427.80 8,641,853.20
this period
30 June 2019/ For the six months 1 January 2019/ For the six months
ended 30 June 2019 ended 30 June 2018
Sinopharm Group
Zhijun(Shenzhen) Pharmaceutical Sinopharm Group Zhijun(Shenzhen)
Co., Ltd. Pharmaceutical Co., Ltd.
Current assets 1,288,625,706.65 1,111,485,098.64
Non-current assets 302,186,939.74 298,610,691.12
Total assets 1,590,812,646.39 1,410,095,789.76
Current liabilities 725,207,812.63 659,931,220.07
Non-current liabilities 20,932,797.22 24,953,965.28
Total liabilities 746,140,609.85 684,885,185.35
Non-controlling interests - -
Shareholders’ equity attributable to
shareholders of the parent 844,672,036.54 725,210,604.41
Portion of net assets calc ulated by
shareholding ratio 413,889,297.90 355,353,196.15
Carrying value of equity investment in
joint ventures 413,889,297.90 355,353,196.15
Operating revenue 1,060,889,164.97 979,292,309.92
Net profit 119,461,432.13 125,252,164.85
Total comprehensive income 119,461,432.13 125,252,164.85
Dividends receiv ed from joint ventures
this period - 58,111,254.57
114
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments
1. Classi fication of financial instruments
The carrying amounts of each category of financial instruments as at the date of financial position are as follows:
30 June 2019
Financial assets at fair Financial assets at Financial assets at fair value through other Total
Financial assets value through profit or loss amortised cost comprehensive income
Mandatorily required Mandatorily Designation
required
Cash and bank balances - 8,086,328,508.49 - - 8,086,328,508.49
Notes receivable - 790,664,828.26 - - 790,664,828.26
Accounts receivable - 11,826,440,731.59 - - 11,826,440,731.59
Receivable financing - - 325,439,580.18 - 325,439,580.18
Other receivables - 654,086,387.85 - - 654,086,387.85
Other non-current financial
assets 140,000,000.00 - - - 140,000,000.00
Investment in other equity
instrument - - - 13,685,760.00 13,685,760.00
140,000,000.00 21,357,520,456.19 325,439,580.18 13,685,760.00 21,836,645,796.37
115
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
1. Classi fication of financial instruments (Continued)
30 June 2019
Financial liabilities Financial liabilities at amortised cost
Short-term borrowings 3,290,877,595.23
Notes payable 3,539,095,262.34
Accounts payable 8,088,697,602.94
Other payables 1,474,526,698.43
Non-current liabilities due within one year 558,296,784.75
16,951,493,943.69
116
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
1. Classi fication of financial instruments (Continued)
The carrying amounts of each category of financial instruments as at the date of financial position are as follows:
1 January 2019
Financial assets at fair Financial assets at Financial assets at fair value through other Total
Financial assets value through profit or loss amortised cost comprehensive income
Mandatorily required Mandatorily Designation
required
Cash and cash equivalents - 8,089,781,304.56 - - 8,089,781,304.56
Notes receivable - 789,536,654.23 - - 789,536,654.23
Accounts receivable - 9,336,861,647.92 - - 9,336,861,647.92
Receivable financing - - 567,775,275.40 567,775,275.40
Other receivables - 643,493,359.32 - - 643,493,359.32
Other non-current financial
assets 140,000,000.00 - - - 140,000,000.00
Investment in other equity
instrument - - - 13,685,760.00 13,685,760.00
140,000,000.00 18,859,672,966.03 567,775,275.40 13,685,760.00 19,581,134,001.43
117
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
1. Classi fication of financial instruments (Continued)
1 January 2019
Financial liabilities Financial liabilities at amortised cost
Short-term borrowings 2,597, 652,702.43
Notes payable 3,416,755,681.80
Accounts payable 6,468,535,961.17
Other payables 1,539, 436,971.93
Non-current liabilities due within one year 5,861, 324.37
Long-term borrowings 31,600,000.00
Long-term payables 3,763, 978.52
14,063,606,620.22
2. Transfer of financial assets
Trans ferred financial assets that are not derec ognized in their entirety
As at 30 June 2019, the Group had endorsed commercial bills receivable (the "Endorsed Bills") to
certain of its suppliers in order to settle trade payables due to such suppliers of RMB5,000,000. 00 (31
December 2018: RMB 301,416.00). During the year, the Group operated a number of discounting
business through several banks in China. At 30 June 2019, the carrying value thereof was
RMB211,316,836.99 (31 December 2018: RMB170,013,427.11). In the opinion of the directors, the
Group has retained the substantial risks and rewards, which include default risks relating to s uch
Endorsed Bills, and accordingly, it continued to recognize the full carrying amounts of the Endorsed
Bills and the associated trade payables settled. Subsequent to the Endorsement, the Group did not
retain any rights of the use of the Endorsed Bills, including the sales, transfer or pledge of the Endorsed
Bills to any other third parties. As at 30 June 2019, the carrying value of trade pay ables settled by the
Group totalled RMB 216, 316,836.99 (31 December 2018: RMB170,314,843.11).
118
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
2. Transfer of financial assets (Continued)
Trans ferred financial assets that are derecognized in their entirety in which continuing involvement
exists
As at 30 June 2019, the Group had endorsed commercial bills receivable (the "Endorsed Bills") to
certain of its suppliers in order to settle trade pay ables due to such suppliers of RMB665,479,757.50
(31 December 2018: RMB568,118,674.84). During the year, the Group operated a number of
discounting business through se veral banks in China. At 30 June 2019, the carrying value thereof was
RMB879,092,916.00 (31 December 2018: RMB705, 143, 849.35). The derecognized bills had a maturity
of 1 to 12 months at the end of the reporting period. In accordanc e with t he Law of Negotia ble
Instruments, the holders of the derecognized bills have a right of recourse against the Group if the
accepting banks default (the “Continuing Involvement ”). In the opinion of the directors, the Group has
transferred substantially all risks and rewards relating to the derecognized bills. Accordingly, it has
derecognized the full carrying amounts of the derecognized bills and the associated trade payables.
The maximum exposure to loss from the Group's Continuing Involvement in the derecognized bills and
the undiscounted cash flows to repurc hase these derecognized bills is equal to their carrying amounts.
In the opinion of the directors, the fair values of the Group’s Continuing Involvement in the
derecognized bills are not significant.
During t he six mont hs ended 30 June 2019, the Group has not recognized any gain or loss on the date
of trans fer. No gain or loss was recognized from derecognized financial assets in which the Continuing
Involvement exists, both during the year or cumulatively.
During t he six mont hs ended 30 June 2019, the Group has not recognized any gain or loss on the date
of transfer of the derec ognized bills. No gains or losses were recognized from the Continuing
Involvement, both during the year or cumulatively.
As part of its normal business, the Group entered into an trade receivable factoring arrangement (the
“Arrangement”) without recourse and trans ferred certain trade receivables to a bank. In the opinion of
the directors, the Group has transferred substantially all risks and rewards under the arrangement.
Accordingly, it has derecognized t he full carrying amounts of the associated trade receivables. The
original carrying value of the derecognized trade receivables transferred under the Arrangement that
have not been settled as at 30 June 2019 amounted to RMB1,299,923,031.76 (31 Dec ember 2018:
RMB827,745,640.19).
119
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
3. Risks of financial instruments
The Group's principal financial instruments comprise bank borrowings and cash and short term deposits.
The main purpose of thes e financial instruments is to raise finance for the Group's operations. The
Group has various other financial assets and liabilities such as trade receivables and trade payabl es,
which arise directly from its operations.
The Company’s board of directors are responsible for planning and establishing the risk management
framework of the Group, formulating risk management policies and related guidelines of the Group and
supervising the implementation of risk management meas ures. The Group has already developed risk
management policies to identify and analyse the risks faced by the Group, which have clearly identified
specific risks, covering a lot of aspects such as market risk, credit risk and liquidity risk management.
The Group regularly assesses the market environment and changes in the Group’s business activities
to determine whether or not to update the risk management policies and systems. The risk
management of the Group shall be conducted by the operations and management department
according to the policy approved by the Company’s management. The operations and management
department identifies, evaluates and avoids related risks by means of close cooperation with o ther
business units of the Group.
To avoid the risk concentrating on a single industry, a specific area or a specific counterparty, the Group
spreads financial instruments risk with diversified investments and business portfolio.
Credit ri sk
The Group only trades with recognised and creditworthy third parties. It is the Group’s policy that all
customers who wish to trade on credit terms are subject to credit verification procedures. In addition,
receivable balances are monit ored on an ongoing basis and the Group’s exposure to bad debts is not
significant. For t ransactions that are not denominated in the functional currency of t he relevant
operating unit, the Group does not offer credit terms without the special approval of t he credit control
department of the Group.
Since cash and bank balances, bank acceptance bills receivable and derivative financial instruments
are placed in the well -establis hed banks with high credit ratings, the credit risk of these financial
instruments is lower.
The other financial instruments of the Group include cash and bank and other receivables. The credit
risk of these financial assets result from default of counterparty. The maximum credit exposure equals
to the book value of these instruments.
120
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Credit ri sk (Continued)
The Group applies standard c redit clause for s ale of goods to customers, at the same time purchase
other goods from some of the major customers. Disclosures regarding maximum credit exposure on
trade receivables are as follows:
30 June 2019 1 January 2019
Trade receivable book value 12,991,845,283.92 10,733,695,012.29
Less: Bad debt provision (49,300,143.89) (39,521,434.74)
Carrying value 12,942,545,140.03 10,694,173,577.55
Amount payable to customer
The Group has agreement with customers stating that only in the circumstances of default in payment
from the c ustomer, can the Group use the payable balance of the same c ustomer t o offset receivables.
Therefore, at every balanc e sheet date, the maximum credit risk expos ure of the Group is the total
amount of trade receivables less bad debt provision. Since payables cannot be offset within the balance
sheet, the maximum credit risk exposure is without deducting the customer payable balance.
Since the Group trades only with recognised and creditworthy third parties, there is no requirement for
collateral. Credit risks are managed by customer/counterparty, by geographical region and by industry
sector. There are no significant concentrations of credit risk within the Group as the customer bases of
the Group’s trade receivables are widely dispersed in different sectors and industries. The Group does
not hold any collateral or ot her credit enhancements over its trade receivable balances.
Determination of significant increase in credit risk
At each reporting date, the group determines whet her the credit risk of a financial asset has increased
significantly since initial recognition. When determining whether the credit risk of a financial asset has
increased significantly since initial recognition, the Group considers reasonable and supportable
information that is relevant and available without undue cost or effort. This includes both quantitative
and qualit ative information analysis, based on the Group’s hist orical experience and informed credit
assessment and including forward-looking information. In order to determine the change of expected
default risk during the financial instrument’s entire lifetime, the Group compares the default risk of
financial instrument on the balance sheet date and on the initial recognition date base on a single
financial instrument or financial instrument port folio with similar default risk.
121
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Credit ri sk (Continued)
The Group determines that the credit risk tof financial assets has significantly increased when one or
more quantitative or qualitative criteria are met:
- quantitative criteria are mai nly probability of default increasing more t han a given % since
initial recognition;
- qualitative criteria are mainly significant detrimental changes in the borrower’s operating or
financial conditions and early warning customer lists.
- The upper criteria is 30 days the borrowers default.
Definition of credit-impaired financial assets
In assessing whether a financial asset is credit-impaired, the Group considers both quantitative and
qualitative information in line with internal credit risk management. The Group assesses whether a
financial asset is credit-impaired by considering the following factors:
- significant financial diffic ulty of the borrower or issuer;
- a breach of contract such as a default or past due event;
- the lender(s) of t he borrower, for economic or contractual reasons relating to the borrower’s
financial difficulty, having granted to the borrower concession(s) that the lender(s) would not
otherwise consider;
- it is becoming probable that the borrower will enter bankruptcy or other financial
reorganisation;
- the disappearance of an active market for security because of financial difficulties ;
- financial assets purchased or sourc ed at large discounts indicating that credit losses have
occurred.
The impairment of financial assets may not be nec essarily due to a single disparat e event. The
combined effects of multiple events may result in financial assets being credit -impaired.
Parameter of the expected credit loss model
Based on whether there is a significant increas e in credit risk and whether the financial assets are
credit-impaired, the Group recognizes impairment allowance for different assets using either 12 -month
expected credit losses or lifetime expected credit losses. The measurement of the ECL model is a
function of the probability of default, the loss given default (i.e. the magnitude of the loss if there is a
default) and the exposure at default. The Group establishes the model by considering the quantitative
analysis of historical statistics such as counterparty rating, the guarant ee method, collateral category,
repayment method, and also forward -looking information.
122
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Credit ri sk (Continued)
Definitions:
- The probability of default is the probability that the debtor will not be able to meet its
repayment obligations within the following 12 mont hs or throughout the remaining duration.
To reflect the macro-economic environment conditions, the Group’s assessment of the
probability of default is based on the calculation of the ECL model adjusted by forward-
looking information.
- The loss given default (i.e. the magnitude of the loss if there is a default) refers to the
Group's expectation of the extent of the loss of default risk exposure. The loss given default
varies depending on the type of counterparty, the way and priority of recourse, and the type
of collateral. The loss given default is the percentage of the risk exposure loss at the time of
default, calculated on the basis of the next 12 mont hs or the entire duration.
- The exposure at default refers to the amount that the Group should be repaid in the event of
default in the next 12 months or throughout the remaining period.
Forward-look ing information
The assessment of a significant increas e in credit risk and the calculation of the ECL both involve
forward-looking information. The Group recognizes key economic ratios that influence credit risk and
ECL by historical data analysis.
As at 30 June 2019, there was no evidence of significant increase in credit risk (31 December 2018: nil).
Currency ri sk
The Group’s major operational activities are carried out in Mainland China and a majority of
thetransactions are denominated in RMB. The Group is exposed to foreign exchange risk arising from
the recognized assets and liabilities, and future transactions denominated in foreign currencies,
primarily with respect to United States dollars and Hong Kong dollars. The Group’s finance department
at its headquarters is responsible for monitoring the amounts of assets and liabilities, and transactions
denominated in foreign currencies. The Group may consider entering into forward exchange contracts
or currency swap contracts to mitigate the foreign exchange risk.
123
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
VIIl. Ri sks related to financial instruments (Continued)
4. Capital management
The Company’s primary objective for managing capital is to ensure that it maintains a strong credit
rating and healthy capital ratio in order to support its business, maximize s hareholders’ value and
benefit relat ed parties. Management als o aims to maintain a capital structure that ensures the lowest
cost of capital available to the entity.
Management adjusts the capital structure through adjusting dividend payments to sharehold ers,
returning capital to shareholders, issuing new shares or selling assets to reduce debts.
The Group’s total capital is the total shareholders’ equity in the balance sheet. The Group does not
adopt an asset ratio as a compulsory factor to govern capital investment.
The gearing ratios of the Group as at 30 June 2019 and 1 January 2019 were as follows:
30 June 2019 1 January 2019
Gearing ratio 56.59% 54.44%
124
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
IX. Di sclosure of fair value
1. Assets and liabilities at fair value
30 June 2019:
Input applied in the measurement of fair value
Quoted Significant Significant Total
prices in observable unobservable
active inputs inputs
markets
Level 1 Level 2 Level 3
Receivable financing - 325,439,580.18 - 325,439,580.18
Investment in other
equity instrument - - 13,685,760.00 - 13,685,760.00
Other non-current
financial assets - - 140,000,000.00 140,000,000.00
- 339,125,340.18 140,000,000.00 479,125,340.18
1 January 2019:
Input applied in the measurement of fair value
Quoted Significant Significant Total
prices in observable unobservable
active inputs inputs
markets
Level 1 Level 2 Level 3
Receivable financing - 567,775,275.40 - 567,775,275.40
Investment in other
equity instrument - - 13,685,760.00 - 13,685,760.00
Other non-current
financial assets - - 140,000,000.00 140,000,000.00
- 581,461,035.40 140,000,000.00 721,461,035.40
125
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
IX. Di sclosure of fair value
2. Assets and liabilities disclosed at fair value
1 January 2019:
Input applied in the measurement of fair value
Quoted Significant Significant Total
prices in observable unobservable
active inputs inputs
markets
Level 1 Level 2 Level 3
Long-term borrowings - 31,600,000.00 - 31,600,000.00
3. Estimation of fair value
The following are book value and fair value of financial instruments of the Group excluding those that has
immaterial different in book value and fair value:
30 June 2019 1 January 2019 31 December 2018
Book value Fair value Book value Fair value Book value Fair value
Financial liabilities
Long-term 31,600,000.0
borrowings - - 31,600,000.00 31,600,000.00 0 31,600,000.00
Management has assessed that the fair values of cash and cash equivalents, notes receivable, trade receivables,
other receivables, short-term borrowings, notes payable, trade payables, other payables, non -current liabilities due
within one year and other current assets and liabilities, and current liabilities approximate to their carrying amounts
largely due to the short remaining maturities of these instruments.
The financial controller of the Group takes the responsibility to formulate policies and procedures related to
financial instrument fair value measurements and directly reports to the CFO and the audit committee. On each
balance sheet date, the financial department analyses the variation of the fair vule of financial instruments and
determines the inputs applicable to valuation. The valuation is required to be approved by the CFO.
The fair values of financial assets and liabilities are the amount at which the instrument could be exchanged or
debts could be settled in an arm’s length transactio n between knowledgeable and willing parties, other than in a
forced or liquidation sale. The following methods and assumptions were used to estimate the fair values.
The fair values of short-term and long-term borrowings, and long-term payables have been calculated by
discounting the expected future cash flows using market rates of return currently available for other financial
instruments with similar terms, credit risk and remaining maturities. As at 30 June 2019, the Group’s own non -
performance risk for short-term and long-term borrowings was assessed to be insignificant.
For an equity instrument of listed entities, the market price is used to determine fair value. For an equity instrument
of non-listed entities, the market comparable company model is used to estimate fair value. The Group believes
that estimated fair value by the valuation method is rational, and also the most sufficient value at the balance sheet
date.
126
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
127
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
IX. Di sclosure of fair value
4. Unobservable inputs
A financial instrument that is measured at fair value with measurement of level 3 is insensitive to reasonable
fluctuation of the unobservable inputs.
5. Transfers between levels of fair value measurement
At 30 June 2019 and 1 January 2019, there were no trans fers of fair value measurement s between
Level 1 and Level 2.
128
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
1. Parent
Share capital Proportion of ownership Proportion of voting power
Registered address Nature of business (RMB’0,000) interest in the Company in the Company
Industrial investment holding, trustee of a pharmaceutical
Sinopharm enterprise, assets reorganization, dis tribution and retail of
Group Shanghai medicines and pharmaceutical products, etc. 297,165.62 56.06% 56.06%
The ultimate controlling party of the Company is CNP GC.
2. Subsidiaries
Refer to Note V II (1) for details of subsidiaries.
129
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
3. Associates
Refer to Note V II (2) for details of associates.
Company name Related party relationships
Shenzhen Main Luck Pharmaceutical Co., Ltd. Associate
Sinopharm Group Zhijun(Shenzhen) Pharmaceutical Co., Ltd. Associate
Shenzhen Zhijun Pharmaceutical Trade Co., Ltd. Associate
Sinopharm Group Zhijun(Shenzhen) Pingshan Pharmaceutical Co., Ltd. Associate
Shyndec Pharmaceutical Associate
Sinopharm Group Zhijun(Suzhou) Pharmaceutical Co., Ltd. Associate
Shanghai Dingqun Enterprise Management Consulting Co., Ltd. Associate
Sinopharm Jienuo Medical Treatment Sevice Guangdong Co., Ltd. Associate
Shanghai Beiyi Guoda pharmaceutical Co. Ltd. Associate
Shanghai Liyi Drug Store Co.,Ltd Associate
Dongyuan accord pharmaceutical chain Co., Ltd. Associate
Shanghai Renbei Pharmacy Co., Ltd. Associate
Guangdong Jianhui Construction Investment Management Co., Ltd. Associate
4. Other related parties
Company name Related party relationships
Sinopharm Holding Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Southw est Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shenyang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dalian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Jincheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Zhidekang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medicine Logistic Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hunan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yongzhou Co., Ltd. Controlled by Sinopharm Group
130
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
China National Medicines Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guorui Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Prospect Dentech (Beijing) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. Controlled by Sinopharm Group
Sinopharm holdings Beijing huahong co., Ltd Controlled by Sinopharm Group
Sinopharm Holding Zhejiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Sub Marketing Center Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Henan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pingdingshan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shandong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lunan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Rizhao Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dezhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Liaocheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hainan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fujian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Putian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Quanzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xiamen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Medical Devices Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ningxia Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinyu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Inner Mongolia Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tongliao Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ulanqab Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Bayannaoer Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hulun Buir Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ordos Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Special Drugs Kashgar Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanghai Likang Phar maceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jilin Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chongqing Co., Ltd. Controlled by Sinopharm Group
131
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
Sinopharm Holding Jiangsu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Biological Products Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Taizhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Suzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lianyungang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanjing Wende Pharmaceutical Co.,Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yancheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Heilongjiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Le-Ren-Tang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lerentang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Shanghai Merro Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Xingsha Phar maceuticals (Xiamen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhangzhou Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dalian Hecheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changsha Co., Ltd. Controlled by Sinopharm Group
Pudong New Area of Shanghai Pharmaceutical Medicine Ltd. Controlled by Sinopharm Group
Sinopharm Group Anhui Medical Devices Co., Ltd. Controlled by Sinopharm Group
China Medical Equipment Shandong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Liaoning Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanxi Medical Devices Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanghai Medicine Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hunan Phar maceutical Development Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Instrument Branch Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin Distribution Center Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhangzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Sichuan Phar maceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Gansu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiangxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chengdu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guangdong Medicine Device Co., Ltd. Controlled by Sinopharm Group
132
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
Sinopharm Holding Hunan Weian Phar macy Medicine Chain Company
Limited Controlled by Sinopharm Group
Sinopharm Xinxiang Chain Store Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yunnan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nantong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument Guizhou Qiannan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Zhuhai Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanghai Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin Binhai Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
China National Pharmaceutical Logistics Co., Ltd. Controlled by Sinopharm Group
Xinjiang Baitong Property Service Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medicine Logistic Co., Ltd. Guangzhou Branch Controlled by Sinopharm Group
China National Scientific Instruments & Materials Imp/Exp Shenzhen Co., Ltd. Controlled by Sinopharm Group
Guorun Medical Supply Chain Service (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Hubei) Base Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Lvliang Co., Ltd. Controlled by Sinopharm Group
Guoyao Lerentang Hebei Medical Device Supply Chain Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Tangshan Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanping Newforce Co., Ltd. Controlled by Sinopharm Group
Sinopharm Hebei Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinhua Co., Ltd. Controlled by Sinopharm Group
Shanghai Tongyu Information Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin North Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Hubei) Hankou Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Hongyuan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiaozuo Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuhu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Honghe Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chuxiong Co., Ltd. Controlled by Sinopharm Group
Yuxi Sinopharm Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hainan Hongyi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Longyan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ningde Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anshun Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tongren Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zunyi Co., Ltd. Controlled by Sinopharm Group
133
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
Sinopharm Holding Guizhou Medical Equiment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jilin Chain Store Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Siping Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wenzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xuzhou Co., Ltd. Controlled by Sinopharm Group
Guoyao Lerentang Shijiazhuang Medical Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Qinghai Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chongqing Taimin Phar maceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Deyang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hongrun Medical Business Servic e (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guangdong Medical Examination Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument Foshan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Nanping Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guangxi Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Suzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lu'an Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanchang Chain Store Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinxiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huangshi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jining Co., Ltd. Controlled by Sinopharm Group
Fujian Sinopharm Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hengshui Medicine Co., Ltd. Controlled by Sinopharm Group
Beijing Sinophar m Tianyuan Real Estate & Property Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Xinjiang Korla Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. Controlled by CNPGC
Huayi Phar maceutical Co., Ltd. Controlled by CNPGC
Beijing Huamiao Pharmaceutical Co., Ltd. Controlled by CNPGC
Guizhou Tongjitang Pharmaceutical Co., Ltd. Controlled by CNPGC
Anhui Jingfang Pharmaceutical Co., Ltd. Controlled by CNPGC
Guangdong Medi-World Phar maceutical Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. Controlled by CNPGC
Shandong Lu Ya Pharmaceutical Co., Ltd. Controlled by CNPGC
Foshan Fengliaoxing Pharmaceutical Co., Ltd. Controlled by CNPGC
Winteam Phar maceutical Group Ltd. Controlled by CNPGC
Foshan Dezhong Pharmaceutical Co., Ltd. Controlled by CNPGC
Chengdu Rongsheng Pharmacy Co., Ltd. Controlled by CNPGC
Lanzhou Biotechnology Development Co., Ltd. Controlled by CNPGC
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. Controlled by CNPGC
134
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
Shantou Jinshi Pow der Injection Co., Ltd. Controlled by CNPGC
Chengdu Institute of Biological Products Co.,Ltd. Controlled by CNPGC
China National Pharmaceutical Industry Co., Ltd. Controlled by CNPGC
Sinopharm Xinjiang Pharmaceutical Co., Ltd. Controlled by CNPGC
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. Controlled by CNPGC
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. Controlled by CNPGC
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. Controlled by CNPGC
Wuhan Zhonglian Pharmaceutical Group Co., Ltd. Controlled by CNPGC
The Fourth Phar maceutical Co., Ltd. of Zhonglian Group Controlled by CNPGC
Sinopharm Chuan Kang Pharmaceutical Co., Ltd. Controlled by CNPGC
China National Pharmaceutical Foreign Trade Corporation Controlled by CNPGC
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. Controlled by CNPGC
Sinopharm Yixin Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Holding Sanyi Medicine (Wuhu) Co., Ltd. Controlled by CNPGC
Guizhou Tongjitang Pharmacy Chain Co., Ltd. Controlled by CNPGC
Sichuan Jiangyouzhongbafuzi Technology Development Co., Ltd. Controlled by CNPGC
Lanzhou Institute of Biological Products Co., Ltd. Controlled by CNPGC
Sinopharm Wuhan blood products Co., Ltd. Controlled by CNPGC
Fujian Chentian Jinling Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Guizhou Blood Products Co., Ltd. Controlled by CNPGC
China National of Traditional&Herbal Medicine Co., Ltd. Controlled by CNPGC
Sinopharm Chongqing Phar maceutical and Medical Industry Design Institute Controlled by CNPGC
Group Financial Co. Controlled by CNPGC
Shanghai Shangsheng Biological Products Co., Ltd. Controlled by CNPGC
Sinopharm Group Chengdu Xinlibang Biological Products Co., Ltd. Controlled by CNPGC
Sinopharm Weiqida Phar maceutical Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. Controlled by CNPGC
Sinopharm Group Fengliaoxing Traditional Chinese Medical Center Foshan
Nanhai Co., Ltd. Controlled by CNPGC
Sinopharm Group Fengliaoxing Pharmacy (Foshan) Co., Ltd. Controlled by CNPGC
Yichang Humanw ell Pharmaceutical Co., Ltd. Associate of Sinopharm Group
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. Associate of Sinopharm Group
Sinopharm Health Online Co., Ltd. Associate of Sinopharm Group
Sinopharm Holding Financing Lease Co., Ltd. Associate of Sinopharm Group
Shanghai Guoda Lingyun Pharmacy Co., Ltd. Associate of Sinopharm Group
Nanchang Sinopharm Holding Guoyaotang Pharmacy Co., Ltd. Associate of Sinopharm Group
Changchun Changsheng Gene Pharmaceutical Co., Ltd. Associate of CNPGC
China Otsuka Pharmaceutical Co., Ltd. Associate of CNPGC
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. Associate of CNPGC
Sinopharm ShanXi Ruifulai Pharmaceutical Co., Ltd. Associate of CNPGC
135
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
Chongqing Yaoyou Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Sichuan Hexin Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Guilin South pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Chaohui Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Tibet Yaoyou Medicines Co.,Ltd. Subsidiary of Fosun Pharm
Shenyang Hongqi Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Transfusion Technology Co., Ltd. Subsidiary of Fosun Pharm
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. Subsidiary of Fosun Pharm
Chongqing Haisiman Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Jinzhou AoHong Pharmaceuticals Co., Ltd. Subsidiary of Fosun Pharm
Hunan Dongting Phar maceutical Co., Ltd. Subsidiary of Fosun Pharm
Jiangsu Huanghe Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Suzhou Erye Pharmaceutical Limited Company Subsidiary of Fosun Pharm
Jiangsu Fuxing Pharmaceutical Trading Co., Ltd Subsidiary of Fosun Pharm
Jiangxi Erye Medicine Marketing Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Compound Technology Medical Devices Co., Ltd. Subsidiary of Fosun Pharm
Foshan Chancheng District Central Hospital Subsidiary of Fosun Pharm
Foshan Chanyixing Medicine Development Co Ltd. Subsidiary of Fosun Pharm
Foshan Chancheng Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shenzhen Qianda Medical Beauty Clinic Subsidiary of Fosun Pharm
Shenzhen Heng Sheng Hosital Subsidiary of Fosun Pharm
Subsidiary of Main Luck
Shenzhen Wanwei Medicine Trading Co., Ltd. Pharmaceutical
Linyi Medical Group Co., Ltd. Non-controlling interest of a subsidiary
Beijing Golden Elephant Fosun Phar maceutical Co., Ltd. Non-controlling interest of a subsidiary
Henan Wanxitang Pharmacy Co., Ltd. Non-controlling interest of a subsidiary
Heyuan Mairui Trading Co., Ltd. Non-controlling interest of a subsidiary
Shenyang Pharmaceutical Co., Ltd. Non-controlling interest of a subsidiary
Zhang Zhenfang Non-controlling interest of a subsidiary
Pingdingshan Pusheng Pharmaceutical Co., Ltd. Non-controlling interest of a subsidiary
Lerentang Investment Group Co., Ltd. Non-controlling interest of a subsidiary
Shenzhen Jiufeng Investment Co., Ltd. Non-controlling interest of a subsidiary
Hunan Minshengtang Investment Co., Ltd. Non-controlling interest of a subsidiary
Taishan Qunkang Phar macy Co., Ltd. Non-controlling interest of a subsidiary
Gu Haiqun Non-controlling interest of a subsidiary
Guangdong Jiyuantang Development Co., Ltd. Non-controlling interest of a subsidiary
Hangzhou Xihu Business Group Corporation Non-controlling interest of a subsidiary
Controlled by non-controlling interest
Nanjing Yuanguang Trading Co., Ltd. of a subsidiary
Controlled by non-controlling interest
Taishan Xiangranhui Trade Co., Ltd of a subsidiary
Shaoguan Wujiang District Muyang Medicine Information Consultant Co., Ltd. Controlled by non-controlling interest
136
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
Company name Related party relationships
of a subsidiary
Family member of the non-controlling
Gu Jinhua shareholder of a subsidiary
Controller of non-controlling interest of
Wang Yang a subsidiary
137
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties
(1) Relat ed party transactions –goods and services
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of transaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Sub Marketing Center Co.,
Ltd. Purchase of goods 583,923,608.63 515,167,083.81
China National Medicines Co., Ltd. Purchase of goods 263,718,638.49 237,636,101.58
Sinopharm Holding Shanxi Co., Ltd.
Purchase of goods 165,125,264.60 156,466,334.83
Sinopharm Holding Shanxi Co., Ltd. Purchase of goods 117,012,541.61 83,517,976.15
Sinopharm Group Purchase of goods 92,577,206.95 95,150,353.69
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. Purchase of goods 84,007,944.24 33,623,739.18
Sinopharm Holding Shenyang Co., Ltd. Purchase of goods 63,745,181.47 63,689,297.73
Sinopharm Le-Ren-Tang Medicine Co., Ltd.
Purchase of goods 58,690,396.26 79,259,083.01
Lanzhou Biotechnology Development Co., Ltd. Purchase of goods 55,500,000.00 -
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. Purchase of goods 54,227,928.18 90,145,795.30
Sinopharm Group Xinjiang Special Drugs
National Phar maceutical Co., Ltd. Purchase of goods 46,674,234.45 39,872,567.55
Sinopharm Lingyun Biopharmaceutical
(Shanghai) Co., Ltd. Purchase of goods 45,672,377.13 127,271,627.94
Sinopharm Holding Inner Mongolia Co., Ltd. Purchase of goods 34,523,083.38 18,984,953.29
Sinopharm Holding Lunan Co., Ltd. Purchase of goods 32,561,603.45 39,298,409.81
Sinopharm Holding Yangzhou Co., Ltd. Purchase of goods 29,671,574.81 23,005,232.97
Jinzhou AoHong Pharmaceuticals Co., Ltd. Purchase of goods 28,182,818.68 23,749,213.17
Chongqing Yaoyou Pharmaceutical Co., Ltd.
Purchase of goods 27,810,842.74 21,508,305.23
Tibet Yaoyou Medicines Co.,Ltd.
Purchase of goods 22,100,470.84 2,761,512.07
Sinopharm Holding Beijing Co., Ltd. Purchase of goods 20,533,829.97 23,822,442.41
Shenzhen Main Luck Pharmaceutical Co., Ltd. Purchase of goods 19,919,483.19 14,173,934.35
Winteam Phar maceutical Group Ltd.
Purchase of goods 19,827,909.28 15,331,219.12
Jiangxi Erye Medicine Marketing Co., Ltd. Purchase of goods 17,959,707.56 -
Sinopharm Holding Fujian Co., Ltd. Purchase of goods 16,041,870.46 9,171,420.33
Sinopharm Holding Lerentang Pharmaceutical
Co., Ltd. Purchase of goods 15,458,862.78 16,967,826.05
Sinopharm Group Zhijun(Shenzhen) Pingshan
Pharmaceutical Co., Ltd. Purchase of goods 14,856,080.60 5,519,530.03
138
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Pingdingshan Co., Ltd. Purchase of goods 14,429,720.75 14,446,097.55
Sinopharm Group Zhijun(Shenzhen)
Pharmaceutical Co., Ltd. Purchase of goods 14,255,875.26 4,670,243.13
Chengdu Rongsheng Pharmacy Co., Ltd. Purchase of goods 13,746,664.10 8,958,139.00
Sinopharm Holding Jiangsu Co., Ltd. Purchase of goods 12,867,682.99 12,276,533.11
Sinopharm Holding Henan Co., Ltd. Purchase of goods 12,814,208.20 6,575,293.46
Shenzhen Wanwei Medicine Trading Co., Ltd. Purchase of goods 10,936,219.06 10,428,796.93
Sinopharm Holding Xiamen Co., Ltd. Purchase of goods 10,273,616.32 9,246,131.91
Sinopharm Holding Xinjiang Special Drugs
Western Pharmaceutical Co., Ltd. Purchase of goods 10,193,725.00 3,614,733.64
Sinopharm Holding Hubei Co., Ltd. Purchase of goods 9,071,305.78 -
Sinopharm Lerentang Shijiazhuang Medicine
Co., Ltd. Purchase of goods 8,677,802.26 10,465,965.70
Sinopharm Holding Shandong Co., Ltd. Purchase of goods 7,306,060.58 718,163.95
Sinopharm Holding Ningxia Co., Ltd. Purchase of goods 7,213,084.95 6,113,483.50
Sinopharm Xingsha Phar maceuticals (Xiamen)
Co., Ltd. Purchase of goods 7,161,067.43 3,676,515.83
Yichang Humanw ell Pharmaceutical Co., Ltd. Purchase of goods 6,711,635.43 4,513,583.78
Sinopharm Holding Changzhou Co., Ltd. Purchase of goods 6,705,005.60 2,900,395.11
China Otsuka Pharmaceutical Co., Ltd. Purchase of goods 6,697,508.52 241,236.29
Shanghai Modern Phar maceutical Co., Ltd.
(Modern Pharmaceutical) Purchase of goods 6,577,712.26 142,521.39
Sinopharm Yixin Pharmaceutical Co., Ltd. Purchase of goods 6,463,202.79 -
Sinopharm Holding Hunan Co., Ltd. Purchase of goods 5,496,202.17 22,435,971.65
Sichuan Hexin Pharmaceutical Co., Ltd. Purchase of goods 5,339,761.19 1,094,458.11
Sinopharm Holding Shanghai Likang
Pharmaceutical Co., Ltd. Purchase of goods 5,189,668.17 2,003,690.59
Suzhou Erye Pharmaceutical Limited Company Purchase of goods 4,729,210.71 9,554,764.03
Beijing Huasheng Pharmaceutical Biotechnology
Development Co., Ltd. Purchase of goods 4,541,480.00 -
Sinopharm Chuan Kang Pharmaceutical Co.,
Ltd. Purchase of goods 4,521,905.90 5,794,907.91
Sinopharm Holding Shanxi Lvliang Co., Ltd. Purchase of goods 4,369,021.12 -
139
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Changzhou Medical Logistics
Center Co., Ltd. Purchase of goods 3,824,818.27 4,530,675.45
Sinopharm Group Guorui Medicine Co., Ltd. Purchase of goods 3,219,200.90 3,735,052.72
Sinopharm Group Rongsheng Pharmaceutical
Co., Ltd. Purchase of goods 3,158,018.27 1,574,958.10
Sinopharm Holding Jinan Co., Ltd. Purchase of goods 3,031,490.28 3,621,583.69
Sinopharm Holding Tongliao Co., Ltd. Purchase of goods 2,906,482.17 584,726.70
Sinopharm Holding Fuzhou Co., Ltd. Purchase of goods 2,676,398.89 4,703,935.11
Pudong New Area of Shanghai Pharmaceutical
Medicine Ltd. Purchase of goods 2,652,028.86 2,298,554.23
Sinopharm Holding Heilongjiang Co., Ltd. Purchase of goods 2,603,286.79 -
Shanghai Shangsheng Biological Products Co.,
Ltd. Purchase of goods 2,478,155.34 -
Sinopharm Holding Wuxi Co., Ltd. Purchase of goods 2,456,981.90 2,453,393.36
Sinopharm Lerentang Hebei Medical Instrument
Trade Co., Ltd. Purchase of goods 2,326,076.00 1,889,376.44
Sinopharm holdings Beijing huahong co., Ltd Purchase of goods 2,143,025.16 3,550,261.18
Sinopharm Holding Jinzhou Co., Ltd. Purchase of goods 2,050,823.42 2,249,516.98
Shanghai Chaohui Pharmaceutical Co., Ltd. Purchase of goods 1,967,905.09 330,363.62
Guizhou Tongjitang Pharmaceutical Co., Ltd. Purchase of goods 1,947,122.98 1,536,282.82
Beijing Golden Elephant Fosun Phar maceutical
Co., Ltd. Purchase of goods 1,673,805.68 1,799,439.15
Sinopharm Holding Beijing Kangchen Bio-
Pharmaceutical Co., Ltd. Purchase of goods 1,672,471.40 2,240,460.54
Jiangsu Fuxing Pharmaceutical Trading Co., Ltd Purchase of goods 1,647,132.50 -
Sinopharm Holding Xinjiang Xinte Karamay
Pharmaceutical Co., Ltd. Purchase of goods 1,634,592.42 1,451,522.48
Sinopharm Holding Donghong Medical
(Shanghai) Co., Ltd. Purchase of goods 1,634,371.49 615,989.84
Shantou Jinshi Pow der Injection Co., Ltd. Purchase of goods 1,575,114.81 330,119.93
Sinopharm Weiqida Phar maceutical Co., Ltd. Purchase of goods 1,396,321.58 31,965.52
Shenyang Hongqi Pharmaceutical Co., Ltd. Purchase of goods 1,395,942.72 1,058,670.33
Sinopharm Holding Zhihuiminsheng (Tianjin)
Pharmaceutical Co., Ltd. Purchase of goods 1,374,403.26 80,410.58
China National Pharmaceutical Industry Co., Ltd. Purchase of goods 1,237,603.17 188,275.39
140
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Hunan Dongting Phar maceutical Co., Ltd. Purchase of goods 1,221,714.73 340,441.92
Sinopharm Holding Yancheng Co., Ltd. Purchase of goods 1,174,557.52 1,402,672.48
Sinopharm Holding Changsha Co., Ltd. Purchase of goods 1,166,442.94 414,897.11
Sinopharm Group (Tianjin) Eastern Bokang
Pharmaceutical Co., Ltd. Purchase of goods 1,115,619.67 921,863.31
Sinopharm Fengliaoxing (Foshan) Medicines
Co., Ltd. Purchase of goods 1,047,564.70 -
Sinopharm Group Southw est Medicine Co., Ltd. Purchase of goods 942,169.90 153,389.66
Sinopharm Holding Xinjiang Special Drugs
Kashgar Pharmaceutical Co., Ltd. Purchase of goods 904,775.75 400,421.76
Shanghai Modern Hasen (Shangqiu)
Pharmaceutical Co., Ltd. Purchase of goods 853,055.98 200,544.82
Sinopharm Group Yibin Pharmaceuticals Co.,
Ltd. Purchase of goods 825,452.16 121,618.26
Sinopharm Holding Suzhou Co., Ltd. Purchase of goods 821,818.78 6,247,553.79
Chengdu Institute of Biological Products Co.,Ltd. Purchase of goods 821,518.40 -
Sinopharm Holding Lianyungang Co., Ltd. Purchase of goods 815,620.38 153,111.27
Sinopharm Holding Hulun Buir Co., Ltd. Purchase of goods 813,318.59 713,341.49
Guangdong Medi-World Phar maceutical Co., Ltd. Purchase of goods 778,815.71 584,223.16
Sinopharm Holding Dalian Co., Ltd. Purchase of goods 708,136.87 769,041.46
Sinopharm Holding Tianjin Co., Ltd. Purchase of goods 706,163.71 1,598,345.37
Sinopharm Holding Biopharmaceutical (Tianjin)
Co., Ltd. Purchase of goods 627,257.64 63,648.72
Sinopharm Holding Putian Co., Ltd. Purchase of goods 602,182.39 895,532.89
Sinopharm Holding Anhui Co., Ltd. Purchase of goods 558,299.15 539,726.50
Sinopharm Holding Hainan Co., Ltd. Purchase of goods 556,396.59 97,450.60
Hutchison Whampoa Sinopharm
Pharmaceuticals (Shanghai) Co., Ltd. Purchase of goods 551,162.81 763,625.20
Anhui Jingfang Pharmaceutical Co., Ltd. Purchase of goods 537,444.48 (13,269.30)
Sinopharm Group Guizhou Blood Products Co.,
Ltd. Purchase of goods 536,000.00 -
Shanghai Merro Pharmaceutical Co., Ltd. Purchase of goods 513,712.42 2,016,321.47
Sinopharm Holding Quanzhou Co., Ltd. Purchase of goods 509,096.37 509,662.25
141
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Guilin South pharmaceutical Co., Ltd. Purchase of goods 491,705.68 -
Shanghai Transfusion Technology Co., Ltd. Purchase of goods 444,825.76 -
Sinopharm Holding Yangzhou Medical Treatment
Equipment Co., Ltd. Purchase of goods 434,284.50 -
Sinopharm Holding Zhejiang Co., Ltd. Purchase of goods 383,036.87 289,516.54
Wuhan Zhonglian Pharmaceutical Group Co.,
Ltd. Purchase of goods 357,980.82 435,887.39
Fujian Chentian Jinling Pharmaceutical Co., Ltd. Purchase of goods 328,557.99 -
Sinopharm Shantou Jinshi Pharmaceutical Co.,
Ltd. Purchase of goods 257,629.73 109,039.96
Sinopharm Wuhan blood products Co., Ltd. Purchase of goods 248,000.00 -
Sinopharm Holding Shanxi Zhidekang Medicine
Co., Ltd. Purchase of goods 189,064.65 -
Sinopharm Holding Dalian Hecheng Co., Ltd. Purchase of goods 175,327.42 262,027.99
Sinopharm Holding Yangzhou Biological
Products Co., Ltd. Purchase of goods 166,268.35 444,000.00
Foshan Fengliaoxing Pharmaceutical Co., Ltd. Purchase of goods 160,792.59 2,015,702.90
Sinopharm Holding (Hubei) Base Pharmaceutical
Co., Ltd. Purchase of goods 152,076.28 -
Sinopharm Holding Dezhou Co., Ltd. Purchase of goods 148,796.05 228,731.52
Sinopharm Holding Hunan Phar maceutical
Development Co., Ltd. Purchase of goods 142,539.15 -
Jiangsu Huanghe Pharmaceutical Co., Ltd. Purchase of goods 133,968.48 -
Sinopharm Holding Bayannaoer Co., Ltd. Purchase of goods 120,003.15 -
China Medical Equipment Shandong Co., Ltd. Purchase of goods 116,013.65 -
Sinopharm Group Shanxi Co., Ltd. Purchase of goods 111,864.77 87,596.90
Foshan Dezhong Pharmaceutical Co., Ltd. Purchase of goods 95,965.53 -
Sinopharm Liaoning Medical Equipment Co., Ltd. Purchase of goods 90,783.71 -
Sinopharm Xinjiang Pharmaceutical Co., Ltd. Purchase of goods 73,542.96 12.82
Sinopharm Holding Fuzhou Medical Devices Co.,
Ltd. Purchase of goods 40,707.96 -
Sinopharm Holding Sanyi Medicine (Wuhu) Co.,
Ltd. Purchase of goods 39,203.47 58,952.78
The Fourth Phar maceutical Co., Ltd. of
Zhonglian Group Purchase of goods 35,353.29 24,295.86
142
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Taizhou Co., Ltd. Purchase of goods 34,438.88 73,304.23
Sichuan Jiangyouzhongbafuzi Technology
Development Co., Ltd. Purchase of goods 29,090.91 49,297.30
Sinopharm Holding Rizhao Co., Ltd. Purchase of goods 19,834.99 586,905.03
Sinopharm Holding Nanjing Wende
Pharmaceutical Co.,Ltd. Purchase of goods 19,401.89 27,310.34
Guoyao Lerentang Hebei Medical Device Supply
Chain Management Co., Ltd. Purchase of goods 17,131.04 -
Sinopharm Holding Ulanqab Co., Ltd. Purchase of goods 17,027.43 308,191.79
Sinopharm Holding Shanxi Mingdikang Medicine
Co., Ltd. Purchase of goods 14,185.41 -
Sinopharm Holding Jilin Co., Ltd. Purchase of goods 13,152.13 -
Sinopharm Group Medicine Logistic Co., Ltd. Purchase of goods 10,445.10 -
Sinopharm Holding Zhangzhou Pharmaceutical
Co., Ltd. Purchase of goods 10,137.93 -
Sinopharm Holding Shanxi Jincheng Co., Ltd. Purchase of goods 8,408.74 11,481.46
Sinopharm Holding Beijing Tianxing Puxin
Biological Medical Co., Ltd. Purchase of goods 6,891.48 335,484.62
Lanzhou Institute of Biological Products Co., Ltd. Purchase of goods - 52,860,000.00
China National Pharmaceutical Foreign Trade
Corporation Purchase of goods - 13,645,110.09
Sinopharm Holding Shanxi Instrument Branch
Co., Ltd. Purchase of goods - 7,410,730.23
Shanghai Shyndec Pharmaceutical Marketing
Co., Ltd. Purchase of goods - 995,510.64
Sinopharm Lerentang Qinhuangdao Medicine
Co., Ltd. Purchase of goods - 193,277.45
Sinopharm Group Zhijun(Suzhou)
Pharmaceutical Co., Ltd. Purchase of goods - 173,484.94
Sinopharm Holding Guizhou Co., Ltd. Purchase of goods - 73,729.75
Chongqing Haisiman Pharmaceutical Co., Ltd. Purchase of goods - 33,895.38
Sinopharm Lerentang Tangshan Medicine Co.,
Ltd. Purchase of goods - 20,598.94
Sinopharm Holding Nanping Newforce Co., Ltd. Purchase of goods - 15,315.32
Sinopharm Zhuhai Medical Instrument Co., Ltd. Purchase of goods - 9,564.95
Sinopharm Hebei Medical Instrument Co., Ltd. Purchase of goods - 6,533.84
Beijing Huamiao Pharmaceutical Co., Ltd. Purchase of goods - 2,649.79
143
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Purchase of goods and receiving of services from related parties
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Group Guangdong Medicine Device
Co., Ltd. Purchase of goods - 1,770.86
Sinopharm Holding Jinhua Co., Ltd. Purchase of goods - 38.80
Sinopharm Holding Ordos Co., Ltd. Purchase of goods - (10,667.01)
Sinopharm Holding Yongzhou Co., Ltd. Purchase of goods (49.36) 38,141.67
Sinopharm Prospect Dentech (Beijing) Co., Ltd. Purchase of goods (63.80) 4,073.48
Sinopharm Group Chengdu Xinlibang Biological
Products Co., Ltd. Purchase of goods (9,500.00) -
Shandong Lu Ya Pharmaceutical Co., Ltd. Purchase of goods (23,551.03) 2,909,280.05
Huayi Phar maceutical Co., Ltd. Purchase of goods (191,940.52) 695,732.52
Storage and
Sinopharm Group Medicine Logistic Co., Ltd. transport 7,275,965.45 6,666,668.71
cost;Consulting c e
Consulting servi
Sinopharm Health Online Co., Ltd. service fee
fee 6,298,404.97 6,085,895.22
Consulting servic e
Shanghai Beiyi Guoda pharmaceutical Co. Ltd. fee 1,229,716.93 1,263,962.22
Shanghai Tongyu Information Technology Co., Information
Ltd. system access fee 142,764.15 98,113.21
Pingdingshan Pusheng Pharmaceutical Co., Ltd. Others 109,458.10 -
China National Pharmaceutical Logistics Co., Storage and
Ltd. transport cost 54,651.59 44,030.65
Sinopharm Holding Tianjin Binhai Information
Pharmaceutical Co., Ltd. system access fee - 7,075.47
144
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Sale of goods and rendering of services
Type of For the six months ended 30 For the six months
Related party transaction June 2019 ended 30 June 2018
Sinopharm Group Sale of goods 113,329,103.30 54,514,170.65
Foshan Chancheng Pharmaceutical Co., Ltd. Sale of goods 59,004,606.02 42,375,781.14
Shanghai Beiyi Guoda pharmaceutical Co. Ltd. Sale of goods 55,645,701.04 49,727,338.63
Sinopharm Holding Hainan Co., Ltd. Sale of goods 48,570,645.00 29,338,160.25
Sinopharm Holding Hainan Hongyi Co., Ltd. Sale of goods 17,357,873.16 24,127,524.50
Sinopharm Holding Wenzhou Co., Ltd. Sale of goods 14,754,017.76 10,830,194.79
Sinopharm holdings Beijing huahong co., Ltd Sale of goods 13,727,246.49 4,816,641.92
Sinopharm Lingyun Biopharmaceutical
7,489,471.75
(Shanghai) Co., Ltd. Sale of goods 12,079,800.79
Sinopharm Holding Sub Marketing Center Co.,
8,970,804.72
Ltd. Sale of goods 12,022,683.32
Beijing Golden Elephant Fosun
9,738,902.57
Pharmaceutical Co., Ltd. Sale of goods 11,241,528.41
Sinopharm Holding Beijing Co., Ltd. Sale of goods 10,806,898.05 5,770,691.44
Shenzhen Heng Sheng Hosital Sale of goods 10,482,252.70 8,215,885.93
Sinopharm Le-Ren-Tang Medicine Co., Ltd. Sale of goods 9,207,801.66 7,728,482.84
Pudong New Area of Shanghai Pharmaceutical
10,524,551.98
Medicine Ltd. Sale of goods 9,123,984.75
Sinopharm Holding Henan Co., Ltd. Sale of goods 8,408,084.97 8,736,054.45
Sinopharm Sichuan Phar maceutical Co., Ltd. Sale of goods 7,749,468.18 9,061,104.38
Sinopharm Holding Nantong Co., Ltd. Sale of goods 7,649,412.43 8,717,338.95
Sinopharm Holding Shandong Co., Ltd. Sale of goods 7,547,654.37 4,577,546.05
Sinopharm Group (Tianjin) Eastern Bokang
Pharmaceutical Co., Ltd. Sale of goods 7,346,892.05 6,837,559.00
Foshan Chancheng District Central Hospital Sale of goods 5,456,346.95 4,504,644.96
Sinopharm Holding Hubei Co., Ltd. Sale of goods 5,366,299.13 3,772,162.27
Sinopharm Holding Shanxi Co., Ltd. Sale of goods 5,246,365.87 917,123.69
Sinopharm Holding Shanghai Likang
Pharmaceutical Co., Ltd. Sale of goods 4,369,980.09 673,847.93
Sinopharm Holding Yangzhou Co., Ltd. Sale of goods 4,293,371.83 5,144,530.81
Shanghai Merro Pharmaceutical Co., Ltd. Sale of goods 4,068,584.00 1,223,626.19
Sinopharm Group Xinjiang Special Drugs
National Phar maceutical Co., Ltd. Sale of goods 3,423,834.39 17,376,808.71
145
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Sale of goods and rendering of services
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Yunnan Co., Ltd. Sale of goods 3,291,886.51 5,713,012.18
Foshan Chanyixing Medicine Development Co
Ltd. Sale of goods 3,252,324.63 1,450,198.02
Sinopharm Holding Anhui Co., Ltd. Sale of goods 2,691,014.38 1,168,187.29
Sinopharm Holding Jinzhou Co., Ltd. Sale of goods 2,509,334.67 -
Sinopharm Holding Xuzhou Co., Ltd. Sale of goods 2,496,791.90 -
Sinopharm Holding Tianjin Co., Ltd. Sale of goods 2,043,046.86 1,029,758.40
China National Medicines Co., Ltd. Sale of goods 1,932,350.56 1,740,716.75
Sinopharm Holding Shanxi Co., Ltd. Sale of goods 1,927,565.82 2,577,305.96
Sinopharm Holding Jilin Co., Ltd. Sale of goods 1,861,781.97 1,172,196.27
Sinopharm Holding Dalian Co., Ltd. Sale of goods 1,833,913.00 1,263,047.36
Sinopharm Holding Xinjiang Special Drugs
Western Pharmaceutical Co., Ltd. Sale of goods 1,828,562.25 4,409,528.78
Sinopharm Holding Fujian Co., Ltd. Sale of goods 1,731,691.96 979,220.98
Sinopharm Group Southw est Medicine Co., Ltd. Sale of goods 1,580,662.42 1,006,172.43
Sinopharm Holding Hunan Co., Ltd. Sale of goods 1,476,158.08 1,308,950.82
Sinopharm Holding Anhui Pharmaceutical Co.,
Ltd. Sale of goods 1,436,139.10 -
Shanghai Liyi Drug Store Co.,Ltd Sale of goods 1,432,059.22 -
Hutchison Whampoa Sinopharm
Pharmaceuticals (Shanghai) Co., Ltd. Sale of goods 1,283,881.89 -
Yuxi Sinopharm Medicine Co., Ltd. Sale of goods 956,668.77 625,927.21
Sinopharm Holding Ningxia Co., Ltd. Sale of goods 772,293.60 240,539.93
Sinopharm Holding Dalian Hecheng Co., Ltd. Sale of goods 743,390.17 301,982.46
Sinopharm Holding Shenyang Co., Ltd. Sale of goods 608,363.96 103,846.57
Sinopharm Holding Gansu Co., Ltd. Sale of goods 505,887.62 1,353,030.00
Sinopharm Holding Wuxi Co., Ltd. Sale of goods 484,790.17 349,203.27
Shanghai Guoda Lingyun Pharmacy Co., Ltd. Sale of goods 425,714.65 540,476.78
Sinopharm Holding Wuhu Co., Ltd. Sale of goods 419,826.51 127,195.59
146
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Sale of goods and rendering of services
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Jiaozuo Co., Ltd. Sale of goods 406,784.27 -
Sinopharm Holding Yancheng Co., Ltd. Sale of goods 382,851.04 -
Sinopharm Holding Honghe Co., Ltd. Sale of goods 377,186.11 9,595.25
Sinopharm Holding Tianjin North Medicine Co.,
Ltd. Sale of goods 363,748.93 58,775.86
Sinopharm Holding Inner Mongolia Co., Ltd. Sale of goods 326,327.82 239,130.68
Sinopharm Group Guangdong Medicine Device
Co., Ltd. Sale of goods 296,825.53 -
Sinopharm Group Shanxi Co., Ltd. Sale of goods 266,895.84 486,510.78
Sinopharm Holding Chengdu Co., Ltd. Sale of goods 252,754.20 215,685.18
Sinopharm Holding Qinghai Co., Ltd. Sale of goods 250,674.21 168,653.68
Sinopharm Holding Donghong Medical
(Shanghai) Co., Ltd. Sale of goods 225,250.43 448,887.64
Sinopharm Holding Tongren Co., Ltd. Sale of goods 197,968.78 21,011.20
Sinopharm Holding (Hubei) Hankou Pharmacy
Co., Ltd. Sale of goods 195,295.22 -
Nanchang Sinopharm Holding Guoyaotang
Pharmacy Co., Ltd. Sale of goods 173,403.11 -
Sinopharm Holding Guizhou Co., Ltd. Sale of goods 158,213.27 1,042,466.52
Sinopharm Holding Chongqing Taimin
Pharmaceutical Co., Ltd. Sale of goods 155,771.69 -
Sinopharm Holding Zunyi Co., Ltd. Sale of goods 146,542.78 35,054.94
Sinopharm Holding Taizhou Co., Ltd. Sale of goods 141,236.61 -
Shenzhen Qianda Medical Beauty Clinic Sale of goods 140,970.86 -
Sinopharm Holding Chongqing Co., Ltd. Sale of goods 138,748.70 145,147.69
Sinopharm Holding Hubei Hongyuan Co., Ltd. Sale of goods 132,556.02 97,162.40
Sinopharm Holding Fuzhou Co., Ltd. Sale of goods 131,753.26 6,927.14
Sinopharm Group Fengliaoxing Pharmacy
(Foshan) Co., Ltd. Sale of goods 128,687.69 -
Sinopharm Holding Jiangxi Co., Ltd. Sale of goods 123,135.25 371,671.87
Sinopharm Medical Instrument Guizhou Qiannan
Co., Ltd. Sale of goods 114,833.43 12,712.58
Sinopharm Fengliaoxing Medical Hospital Co.,
Ltd. Sale of goods 101,588.59 16,804.60
147
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Sale of goods and rendering of services
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Changzhou Medical Logistics
Center Co., Ltd. Sale of goods 86,668.69 175,352.41
Sinopharm Holding Jiangsu Co., Ltd. Sale of goods 76,013.68 -
Sinopharm Guangdong Medical Examination
Co., Ltd. Sale of goods 73,203.54 -
Sinopharm Holding Guizhou Medical Equiment
Co., Ltd. Sale of goods 70,073.94 133,404.19
Sinopharm Group Guangxi Medical Equipment
Co., Ltd. Sale of goods 66,013.12 -
Shanghai Compound Technology Medical
Devices Co., Ltd. Sale of goods 59,482.76 -
Sinopharm Medical Instrument Foshan Co., Ltd. Sale of goods 58,330.19 -
Sinopharm Guanai Yuankang Pharmacy
(Haikou) Co., Ltd. Sale of goods 55,763.79 -
Sinopharm Holding Changzhou Co., Ltd. Sale of goods 50,185.70 435,840.01
Sinopharm Holding Ulanqab Co., Ltd. Sale of goods 47,434.77 175,775.17
Sinopharm Holding Longyan Co., Ltd. Sale of goods 44,963.97 58,172.99
Sinopharm Holding Chuxiong Co., Ltd. Sale of goods 41,712.99 -
Sinopharm Holding Jilin Chain Store Co., Ltd. Sale of goods 38,234.48 91,435.98
Sinopharm Holding Deyang Co., Ltd. Sale of goods 36,771.21 -
Dongyuan accord pharmaceutical chain Co., Ltd. Sale of goods 30,868.27 39,393.65
Sinopharm Holding Anshun Co., Ltd. Sale of goods 21,688.95 -
Sinopharm Nanping Medical Instrument Co., Ltd. Sale of goods 19,993.91 -
Sinopharm Holding Ningde Co., Ltd. Sale of goods 19,818.67 23,864.90
Sinopharm Holding Liaocheng Co., Ltd. Sale of goods 15,779.79 15,596.82
Sinopharm Group Zhijun(Shenzhen)
Pharmaceutical Co., Ltd. Sale of goods 14,949.89 7,617.49
Sinopharm Zhuhai Medical Instrument Co., Ltd. Sale of goods 13,939.15 9,119.70
Sinopharm Holding Shanxi Jincheng Co., Ltd. Sale of goods 11,204.59 -
Sinopharm Holding Siping Co., Ltd. Sale of goods 9,998.28 26,548.13
Sinopharm Holding Hongrun Medical Business
Service (Shanghai) Co., Ltd. Sale of goods 9,884.46 19,240.32
China National Scientific Instruments & Materials
Imp/Exp Shenzhen Co., Ltd. Sale of goods 6,320.71 -
148
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Sale of goods and rendering of services
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Sinopharm Group Fengliaoxing Traditional
Chinese Medical Center Foshan Nanhai Co., Ltd. Sale of goods 6,233.90 -
Sinopharm Jienuo Medical Treatment Sevice
Guangdong Co., Ltd. Sale of goods 3,590.16 -
Guoyao Lerentang Shijiazhuang Medical
Management Co., Ltd. Sale of goods 2,663.79 -
Sinopharm Holding Zhejiang Co., Ltd. Sale of goods - 921,282.05
Hubei Pharmaceutical Group Co., Ltd. Sale of goods - 853,130.68
Sinopharm Holding Heilongjiang Co., Ltd. Sale of goods - 324,789.98
Sinopharm Holding Yongzhou Co., Ltd. Sale of goods - 203,544.77
Sinopharm Holding Huaian Co., Ltd. Sale of goods - 128,653.00
Sinopharm Holding Suzhou Co., Ltd. Sale of goods - 103,840.63
Sinopharm Group Zhijun(Shenzhen) Pingshan
Pharmaceutical Co., Ltd. Sale of goods - 79,279.28
Sinopharm Holding Lu'an Co., Ltd. Sale of goods - 66,987.18
Sinopharm Holding Nanchang Chain Store Co.,
Ltd. Sale of goods - 54,017.59
Sinopharm Holding Xinxiang Co., Ltd. Sale of goods - 34,164.62
Sinopharm Holding Huangshi Co., Ltd. Sale of goods - 34,025.78
Sinopharm Holding Jining Co., Ltd. Sale of goods - 19,035.54
Fujian Sinopharm Medical Instrument Co., Ltd. Sale of goods - 13,988.00
Sinopharm Lerentang Baoding Medicine Co.,
Ltd. Sale of goods - 12,991.45
Sinopharm Lerentang Hengshui Medicine Co.,
Ltd. Sale of goods - 12,108.38
Sinopharm Holding Hulun Buir Co., Ltd. Sale of goods - 4,570.00
Sinopharm Holding Putian Co., Ltd. Sale of goods (33,809.91) 64,610.68
Sinopharm Holding Quanzhou Co., Ltd. Sale of goods (87,055.63) -
Transport and
China National Medicines Co., Ltd. storage income 4,430,727.40 3,580,698.30
Transport and
Sinopharm Group Medicine Logistic Co., Ltd. storage income 401,376.93 294,804.62
Sinopharm Group Zhijun(Shenzhen)
Pharmaceutical Co., Ltd. Meal fee 308,882.00 294,180.00
Sinopharm Group Zhijun(Shenzhen) Pingshan Transport and
Pharmaceutical Co., Ltd. storage income 123,995.03 122,242.00
149
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Relat ed party transactions –goods and services (Continued)
Sale of goods and rendering of services
For the six months For the six months
Related party Type of ransaction ended 30 June 2019 ended 30 June 2018
Transport and
Sinopharm Group Southw est Medicine Co., Ltd. storage income 82,001.72 -
Sinopharm Holding Biopharmaceutical (Tianjin) Consulting servic e
Co., Ltd. income 2,792.45 -
Consulting servic e
Sinopharm Holding Shanxi Co., Ltd. income 1,688.12 9,433.96
Consulting servic e
Guizhou Tongjitang Pharmaceutical Co., Ltd. income - 8,285.71
Consulting servic e
Winteam Phar maceutical Group Ltd. income - 2,023.58
Sinopharm Holding Shanxi Instrument Branch
Co., Ltd. Other income - 1,132.08
150
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(2) Relat ed party transactions - leases
(a) As the lessor
Income from leases Income from leases
Type of assets
For the six months For the six months
under leases
ended 30 June 2019 ended 30 June 2018
Sinopharm Group Zhijun(Shenzhen)
Pharmaceutical Co., Ltd. Building 957,142.86 351,428.58
Shenzhen Zhijun Pharmaceutical Trade Co.,
Ltd. Building 285,714.30 285,714.30
China National Medicines Co., Ltd. Building 24,000.00 45,714.29
(b) As the lessee
Expense from leases Expense from leases
Type of assets
For the six months For the six months
under leases
ended 30 June 2019 ended 30 June 2018
Beijing Golden Elephant Fosun Phar maceutical Building 6,670,660.92 5,461,904.76
Co., Ltd.
Sinopharm Group Medicine Logistic Co., Ltd. Equipment 3,750,000.00 3,750,000.00
Sinopharm Group Shanghai Co., Ltd. Building 3,721,698.57 3,790,426.48
Sinopharm Group Medicine Logistic Co., Ltd. Building 3,539,999.98 3,539,999.98
Lerentang Investment Group Co., Ltd. Building 3,354,162.22 2,277,892.99
Pingdingshan Pusheng Pharmaceutical Co., Building 2,405,696.37 1,277,732.57
Ltd.
Sinopharm Group Xinjiang Special Drugs Building 2,234,982.50 3,914,124.76
National Phar maceutical Co., Ltd.
Sinopharm Holding Yangzhou Co., Ltd. Building 1,902,091.52 1,862,857.14
Hunan Minshengtang Investment Co., Ltd. Building 1,838,716.70 2,027,673.99
Linyi Medical Group Co., Ltd. Building 1,482,764.04 2,036,376.45
Guangdong Jiyuantang Development Co., Ltd. Building 1,088,752.31 1,192,864.11
Nanjing Yuanguang Trading Co., Ltd. Building 855,468.84 866,794.89
Shaoguan Wujiang District Muyang Medicine Building 476,713.98 470,161.86
Information Consultant Co., Ltd.
Taishan Xiangranhui Trade Co., Ltd Building 456,054.17 451,963.88
Sinopharm Holding Xinjiang Xinte Karamay Building 277,303.54 184,253.18
Pharmaceutical Co., Ltd.
Sinopharm Group Building 267,553.06 259,915.02
Wang Yang Building 262,857.12 262,857.12
Sinopharm Holding Beijing Co., Ltd. Building 260,870.74 235,714.29
Shenyang Pharmaceutical Co., Ltd. Building 253,564.15 3,548,219.75
Zhang Zhenfang Building 214,062.49 402,499.98
151
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(2) Relat ed party transactions – leases (Continued)
(b) As the lessee (continued)
Expense from leases Expense from leases
Type of assets For the six months For the six months
under leases ended 30 June 2019 ended 30 June 2018
Gu Jinhua Building 207,084.48 178,800.00
Beijing Sinopharm Tianyuan Real Estate &
Property Management Co., Ltd. Building 173,068.27 173,523.81
Hangzhou Xihu Business Group
Corporation Building 145,986.38 132,823.81
China National Medicines Co., Ltd. Building 145,865.91 153,750.00
Sinopharm Xinjiang Pharmaceutical Co.,
Ltd. Building 136,369.86 130,208.30
Gu Haiqun Building 108,277.61 0.00
Shenzhen Jiufeng Investment Co., Ltd. Building 100,414.19 89,260.15
Taishan Qunkang Pharmacy Co., Ltd. Building 70,864.95 74,170.32
Sinopharm Holding Xinjiang Special Drugs
Kashgar Pharmaceutical Co., Ltd. Building 47,990.56 236,051.50
Sinopharm Holding Fujian Co., Ltd. Building 6,571.39 6,571.38
Sinopharm Holding Shanxi Co., Ltd. Building 0.00 234,017.16
Xinjiang Baitong Property Service Co., Ltd. Building 0.00 44,581.16
Sinopharm Group Zhijun(Shenzhen)
Pingshan Pharmaceutical Co., Ltd. Park 0.00 35,428.57
152
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(3) Relat ed party transactions – Financing
Related party Amount Inception Maturity Note
Borrowed from
Discount on commercial
Group Financial Co. 43,428,873.45 22 April 2019 31 May 2019 acceptance notes
Group Financial Co. 40,197,120.84 17 April 2019 17 July 2019 Short-term borrowings
Discount on commercial
Group Financial Co. 38,384,946.67 24 January 2019 28 February 2019 acceptance notes
Group Financial Co. 37,311,327.27 22 May 2019 22 August 2019 Short-term borrowings
Discount on commercial
Group Financial Co. 33,815,106.08 18 March 2019 30 April 2019 acceptance notes
CNPGC 31,600,000.00 24 May 2017 24 May 2020 Long-term borrow ings
Discount on commercial
Group Financial Co. 27,852,641.75 30 January 2019 30 April 2019 acceptance notes
Discount on commercial
Group Financial Co. 27,408,812.83 21 May 2019 30 June 2019 acceptance notes
Discount on commercial
Group Financial Co. 23,148,716.55 18 March 2019 25 May 2019 acceptance notes
Discount on commercial
Group Financial Co. 21,601,820.90 18 March 2019 31 May 2019 acceptance notes
Discount on commercial
Group Financial Co. 20,902,069.23 30 January 2019 28 March 2019 acceptance notes
Discount on commercial
Group Financial Co. 18,680,669.14 21 May 2019 31 July 2019 acceptance notes
Discount on commercial
Group Financial Co. 18,309,493.19 30 January 2019 29 March 2019 acceptance notes
Discount on commercial
Group Financial Co. 14,997,301.99 30 January 2019 09 May 2019 acceptance notes
Discount on commercial
Group Financial Co. 14,442,689.98 30 January 2019 25 March 2019 acceptance notes
Discount on commercial
Group Financial Co. 11,932,011.37 30 January 2019 26 April 2019 acceptance notes
Discount on commercial
Group Financial Co. 9,827,139.59 22 April 2019 09 August 2019 acceptance notes
Discount on commercial
Group Financial Co. 9,776,155.18 22 April 2019 25 June 2019 acceptance notes
Discount on commercial
Group Financial Co. 2,227,866.60 30 January 2019 28 June 2019 acceptance notes
26 September Discount on commercial
Group Financial Co. 2,115,440.26 22 April 2019 2019 acceptance notes
Discount on commercial
Group Financial Co. 2,037,126.50 30 January 2019 28 May 2019 acceptance notes
Discount on commercial
Group Financial Co. 1,628,019.46 18 March 2019 27 August 2019 acceptance notes
Discount on commercial
Group Financial Co. 1,188,450.22 30 January 2019 26 June 2019 acceptance notes
Group Financial Co. 859,454.60 21 May 2019 26 August 2019 Discount on commercial
acceptance notes
Group Financial Co. 798,997.80 22 April 2019 26 July 2019 Discount on commercial
acceptance notes
Group Financial Co. 729,054.60 18 March 2019 26 June 2019 Discount on commercial
acceptance notes
153
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(4) Relat ed party asset transfer
Ty pe of transaction For the six months For the six months
ended 30 June 2019 ended 30 June 2018
Sinopharm Holding Tianji n Binhai Pharmaceutical Co., Purchase of
Ltd. construction in progress - 21,794.87
(5) Other related party transactions
For the six months For the six months
ended 30 June 2019 ended 30 June 2018
(a) Remuneration for key management personnel 3,843,750.00 2,981,250.00
(b) Interest expense
For the six months For the six months
Related party Category ended 30 June 2019 ended 30 June 2018
Payment of notes
Group Financial Co. discount interest 2,615,234.17 3,411,652.84
China National Phar maceutical Group Payment of entrusted loan
Corporation interest 641,469.02 641,469.02
Group Financial Co. Payment of loan interest 473,516.87 -
Sinopharm Holding Financing Lease Payment of financing
Co., Ltd. lease interest 177,850.56 623,402.17
Payment of non-recourse
Sinopharm Holding Financing Lease receiv able factored
Co., Ltd. interest expense 63,750.00 -
Guorun Medical Supply Chain Serv ices Pay ment of related parties
(Shangha i) Co., Ltd. loan interest - 1,778.67
3,971,820.62 4,678,302.70
(c) Int erest income
For the six months For the six months
Related party Category ended 30 June 2019 ended 30 June 2018
Sinopharm Group Zhijun (Suzhou)
Pharmaceutical Co., Ltd. Entrusted loan interest 1,669,601.71 1,549,650.99
Group Financial Co. Deposit interest 145,659.27 387,479.46
1,815,260.98 1,937,130.45
154
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties
Accounts receiv able 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for
Related party amount bad debt amount bad debt
Foshan Chancheng Pharmaceutical Co.,
Ltd. 45,958,521.41 276,165.34 39,888,094.43 235,040.74
Sinopharm Group 40,401,102.06 - 32,263,115.51 -
Sinopharm Holding Hainan Co., Ltd. 9,869,915.19 - 6,607,589.69 -
Shanghai Beiyi Guoda pharmaceutical Co.
Ltd. 9,772,467.43 - 11,966,548.05 -
Sinopharm Health Online Co., Ltd. 7,991,221.08 - 6,543,624.21 -
Sinopharm Holding Sub Marketing Center
Co., Ltd. 4,943,166.98 - - -
Sinopharm holdings Beijing huahong co.,
Ltd 4,491,263.20 - 4,009,562.41 -
Shenzhen Heng Sheng Hosital 4,350,627.94 - 2,674,948.35 -
Beijing Golden Elephant Fosun
Pharmaceutical Co., Ltd. 4,350,308.37 - 5,372,873.84 -
Pudong New Area of Shanghai
Pharmaceutical Medicine Ltd. 4,175,729.23 - 3,839,268.45 -
Sinopharm Le-Ren-Tang Medicine Co., Ltd. 4,123,874.57 - 3,143,231.13 -
Sinopharm Lingyun Biopharmaceutical
(Shanghai) Co., Ltd. 4,092,864.80 - 3,986,543.21 -
Sinopharm Holding Beijing Co., Ltd. 3,345,842.50 - 888,815.16 -
Sinopharm Holding Hainan Hongyi Co., Ltd. 3,314,718.28 - 5,370,089.88 -
Foshan Chancheng District Central Hospital 3,160,081.13 44,928.58 2,440,447.52 12,753.61
Sinopharm Group (Tianjin) Eastern Bokang
Pharmaceutical Co., Ltd. 2,539,969.75 - 986,526.05 -
Sinopharm Holding Henan Co., Ltd. 2,447,128.74 - 1,036,327.62 -
Sinopharm Holding Shanghai Likang
Pharmaceutical Co., Ltd. 2,196,272.00 - 1,178,605.80 -
Sinopharm Holding Shandong Co., Ltd. 2,037,494.51 - 210,969.36 -
Foshan Chanyixing Medicine Development
Co Ltd. 1,865,947.36 6,667.32 1,743,775.57 9,377.72
Sinopharm Holding Wenzhou Co., Ltd. 1,710,031.20 - 1,261,643.94 -
China National Medicines Co., Ltd. 1,604,941.84 - 1,454,237.32 -
Sinopharm Sichuan Phar maceutical Co.,
Ltd. 1,424,513.17 - 1,081,909.20 -
Sinopharm Holding Yangzhou Co., Ltd. 1,366,338.68 - 540,349.73 -
Shanghai Merro Pharmaceutical Co., Ltd. 1,348,428.86 - 884,486.53 -
Sinopharm Holding Xuzhou Co., Ltd. 1,272,626.48 - 34,941.30 -
Sinopharm Holding Anhui Pharmaceutical
Co., Ltd. 1,095,210.16 - - -
Sinopharm Holding Shanxi Co., Ltd. 1,044,424.48 - 1,028,660.04 -
Sinopharm Holding Yunnan Co., Ltd. 852,406.76 - 27,737.44 -
155
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties (Continued)
Accounts receiv able (Continued) 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for
Related party amount bad debt amount bad debt
Sinopharm Holding Tianjin Co., Ltd. 736,401.04 - 200,407.20 -
Sinopharm Holding Jilin Co., Ltd. 638,937.96 - 1,499,742.50 -
Sinopharm Holding Nantong Co., Ltd. 637,245.24 - 66,541.32 -
Sinopharm Holding Fujian Co., Ltd. 602,589.12 - - -
Sinopharm Group Xinjiang Special Drugs
National Phar maceutical Co., Ltd. 599,179.84 - 772,488.31 -
Sinopharm Holding Donghong Medical
(Shanghai) Co., Ltd. 596,543.86 - 164,566.12 -
Sinopharm Holding Anhui Co., Ltd. 583,647.00 - 221,425.72 -
Sinopharm Holding Xinjiang Special Drugs
Western Pharmaceutical Co., Ltd. 552,496.16 - 1,704,316.57 -
Sinopharm Holding Hunan Co., Ltd. 537,470.30 - 569,264.26 -
Sinopharm Holding Hubei Co., Ltd. 457,991.94 - 68,314.16 -
Sinopharm Holding Shanxi Co., Ltd. 368,536.28 - 68,361.75 -
Yuxi Sinopharm Medicine Co., Ltd. 365,065.92 - 182,532.96 -
Sinopharm Holding Dalian Co., Ltd. 357,662.16 - 144,334.03 -
Shanghai Guoda Lingyun Pharmacy Co.,
Ltd. 357,524.59 - 17,535.13 -
Sinopharm Holding Dalian Hecheng Co.,
Ltd. 286,270.00 - 126,684.00 -
Sinopharm Holding Chengdu Co., Ltd. 280,800.00 - - -
Sinopharm Group Southw est Medicine Co.,
Ltd. 248,554.12 - 5,090,863.70 -
Sinopharm Group Medicine Logistic Co.,
Ltd. 209,724.91 - 139,697.93 -
Sinopharm Holding (Hubei) Hankou
Pharmacy Co., Ltd. 201,154.08 - - -
Sinopharm Jienuo Medical Treatment
Sevice Guangdong Co., Ltd. 124,568.18 - 120,403.60 -
Sinopharm Holding Qinghai Co., Ltd. 110,520.40 - 96,319.48 -
Sinopharm Holding Yancheng Co., Ltd. 108,561.80 - - -
Sinopharm Holding Ningxia Co., Ltd. 100,896.00 - - -
Sinopharm Holding Gansu Co., Ltd. 94,147.34 - 176,910.34 -
Sinopharm Holding Shenyang Co., Ltd. 84,504.52 - 123,126.34 -
Sinopharm Holding Tianjin North Medicine
Co., Ltd. 78,465.54 - 91,390.41 -
Sinopharm Group Fengliaoxing Pharmacy
(Foshan) Co., Ltd. 69,005.33 453.65 - -
Sinopharm Holding Inner Mongolia Co., Ltd. 63,160.96 - 90,159.36 -
Sinopharm Group Zhijun(Shenzhen)
Pingshan Pharmaceutical Co., Ltd. 59,076.00 - 39,618.00 -
Sinopharm Holding Honghe Co., Ltd. 58,831.14 - - -
Sinopharm Holding Heilongjiang Co., Ltd. 50,000.00 50,000.00 50,000.00 -
Sinopharm Guangdong Medical
Examination Co., Ltd. 41,360.00 - - -
156
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties (Continued)
Accounts receiv able (Continued) 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for
Related party amount bad debt amount bad debt
Sinopharm Holding Jiangxi Co., Ltd. 22,606.08 - - -
Shanghai Liyi Drug Store Co.,Ltd 19,278.81 - 76,366.48 -
Sinopharm Holding Zunyi Co., Ltd. 18,358.20 - - -
Sinopharm Holding Changzhou Co., Ltd. 15,557.40 - - -
Sinopharm Holding Fuzhou Co., Ltd. 15,195.60 - - -
Sinopharm Holding Chuxiong Co., Ltd. 13,132.80 - - -
Sinopharm Fengliaoxing Medical Hospital
Co., Ltd. 12,020.26 74.54 16,836.25 136.35
Nanchang Sinopharm Holding Guoyaotang
Pharmacy Co., Ltd. 11,448.00 - - -
Sinopharm Holding Guizhou Co., Ltd. 8,307.00 - 16,026.00 -
Sinopharm Holding Wuxi Co., Ltd. 6,818.00 - 157,614.80 -
Sinopharm Group Zhijun(Shenzhen)
Pharmaceutical Co., Ltd. 6,669.00 - 1,070.60 -
Sinopharm Holding Hongrun Medical
Business Service (Shanghai) Co., Ltd. 5,900.96 - 1,300.54 -
Sinopharm Holding Ulanqab Co., Ltd. 3,933.10 - - -
Sinopharm Guanai Yuankang Pharmacy
(Haikou) Co., Ltd. 3,366.10 - 1,488.00 -
Sinopharm Group Fengliaoxing Traditional
Chinese Medical Center Foshan Nanhai
Co., Ltd. 1,526.02 4.78 695.70 0.94
Sinopharm Group Shanxi Co., Ltd. 1.60 - 58,518.00 -
Sinopharm Xinxiang Chain Store Co., Ltd. - - 2,064.20 -
Sinopharm Holding Changzhou Medical - - 144,600.00 -
Logistics Center Co., Ltd.
Sinopharm Medical Instrument Foshan Co., - - 11,904.00 -
Ltd.
Hubei Pharmaceutical Group Co., Ltd. - - 61,959.91 -
157
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties (Continued)
Notes receiv able 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for bad
Related party amount bad debt amount debt
Sinopharm Holding Financing Lease Co.,
Ltd. 13,210,232.00 - 202,456,075.93 -
Sinopharm Holding Hainan Co., Ltd. 3,896,828.51 - 12,035,409.02 -
Sinopharm Le-Ren-Tang Medicine Co.,
Ltd. 2,500,000.00 - 1,148,409.56 -
Sinopharm Holding Hainan Hongyi Co.,
Ltd. 1,528,421.30 - 10,234,483.82 -
Sinopharm Holding Hubei Co., Ltd. 1,008,876.24 - - -
Sinopharm Holding Nantong Co., Ltd. 750,000.00 - - -
Sinopharm Holding Xinjiang Special Drugs
Western Pharmaceutical Co., Ltd. 472,387.20 - - -
Sinopharm Holding Gansu Co., Ltd. 239,670.00 - 163,198.80 -
Sinopharm Holding Shanxi Co., Ltd. - - 1,077,861.97 -
Sinopharm Holding Shenyang Co., Ltd. - - 422,520.00 -
Sinopharm Holding Shanxi Co., Ltd. - - 359,459.04 -
Sinopharm Holding Sub Marketing Center
Co., Ltd. - - 3,144,392.00 -
Sinopharm Holding Henan Co., Ltd. - - 1,032,584.76 -
Sinopharm Holding Anhui Co., Ltd. - - 390,062.21 -
Sinopharm Holding Shandong Co., Ltd. - - 1,241,661.12 -
Sinopharm Holding Fujian Co., Ltd. - - 400,000.00 -
Sinopharm Holding Ningxia Co., Ltd. - - 176,568.00 -
Sinopharm Holding Jilin Co., Ltd. - - 274,058.00 -
Sinopharm Holding Chengdu Co., Ltd. - - 201,332.00 -
Other receivables 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for bad
Related party amount bad debt amount debt
Sinopharm Group Zhijun(Suzhou)
Pharmaceutical Co., Ltd. 44,000,000.00 2,200,000.00 44,000,000.00 -
Sinopharm Group Medicine Logistic Co.,
Ltd. 6,226,734.36 - 2,494,174.31 -
Shyndec Pharmaceutical 5,624,940.00 - 7,913,430.00 -
Sinopharm Group Xinjiang Special Drugs
National Phar maceutical Co., Ltd. 385,381.65 - 100,000.00 -
Sinopharm Group Zhijun(Shenzhen)
Pharmaceutical Co., Ltd. 234,693.89 600.00 109,774.26 600.00
Sinopharm Lerentang Hebei Medical
Instrument Trade Co., Ltd. 48,493.16 - 48,493.16 -
Sinopharm Holding Tianjin Co., Ltd. 41,100.00 - - -
Sinopharm Group 13,416.00 - - -
158
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties (Continued)
Other receivables (Continued) 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for bad
Related party amount bad debt amount debt
Sinopharm Holding Sub Marketing Center
Co., Ltd. 10,990.00 - - -
Wuhan Zhonglian Pharmaceutical Group
Co., Ltd. 5,000.00 1,000.00 5,000.00 1,000.00
Sinopharm Holding Fujian Co., Ltd. 3,476.39 - 5,476.34 -
Sinopharm Holding Jiaozuo Co., Ltd. - - 30,171.00 -
Henan Wanxitang Pharmacy Co., Ltd. - - 1,098,981.30 -
Sinopharm Health Online Co., Ltd. - - 81,755.36 -
Sinopharm Group Medicine Logistic Co.,
Ltd. Guangzhou Branch - - 18,650.00 -
Advances to suppliers 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for bad
Related party amount bad debt amount debt
Sinopharm Group Xinjiang Special Drugs
National Phar maceutical Co., Ltd. 1,628,396.28 - 1,643,251.42 -
Chongqing Yaoyou Pharmaceutical Co.,
Ltd. 1,097,717.47 - 931,286.48 -
Sinopharm Group 760,415.14 - 2,308,319.33 -
Guizhou Tongjitang Pharmaceutical Co.,
Ltd. 446,109.64 - 227,175.58 -
Sinopharm Holding Xinjiang Special Drugs
Kashgar Pharmaceutical Co., Ltd. 242,701.50 - - -
Sinopharm Holding Xinjiang Xinte
Karamay Pharmaceutical Co., Ltd. 230,666.79 - - -
Sichuan Hexin Pharmaceutical Co., Ltd. 174,960.00 - - -
Anhui Jingfang Pharmaceutical Co., Ltd. 146,744.67 - 45,611.47 -
Sinopharm Weiqida Phar maceutical Co.,
Ltd. 140,382.00 - - -
Chengdu Rongsheng Pharmacy Co., Ltd. 122,000.00 - 1,416,622.63 -
Beijing Sinophar m Tianyuan Real Estate &
Property Management Co., Ltd. 82,800.00 - 78,857.14 -
Sinopharm Yixin Pharmaceutical Co., Ltd. 81,152.00 - - -
China National Medicines Co., Ltd. 78,750.00 - 78,750.00 -
Chengdu Institute of Biological Products
Co.,Ltd. 64,979.60 - 48,734.70 -
Sinopharm Group Guorui Medicine Co.,
Ltd. 63,310.27 - - -
Shyndec Pharmaceutical 56,281.48 - 57,838.35 -
Shenzhen Wanwei Medicine Trading Co.,
Ltd. 50,658.00 - - -
Jinzhou AoHong Pharmaceuticals Co.,
Ltd. 33,040.00 - 16,520.00 -
Sinopharm Group Yibin Pharmaceuticals
Co., Ltd. 27,085.38 - 15,655.31 -
159
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties (Continued)
Advances to suppliers(Continued) 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for bad
Related party amount bad debt amount debt
Guilin South pharmaceutical Co., Ltd. 26,524.88 - 10,989.56 -
Shanghai Chaohui Pharmaceutical Co., 21,646.80 - - -
Ltd.
Sinopharm Xinjiang Korla Pharmaceutical 20,279.70 - 282,467.38 -
Co., Ltd.
Jiangxi Erye Medicine Marketing Co., Ltd. 16,726.80 - 729,789.16 -
Shantou Jinshi Pow der Injection Co., Ltd. 14,889.93 - - -
Sinopharm Holding Sub Marketing Center 14,885.06 - - -
Co., Ltd.
Taishan Qunkang Phar macy Co., Ltd. 13,150.07 - - -
Shandong Lu Ya Pharmaceutical Co., Ltd. 11,436.42 - 1,412.52 -
Sinopharm Xingsha Phar maceuticals 9,560.00 - 1,846.55 -
(Xiamen) Co., Ltd.
Suzhou Erye Pharmaceutical Limited 9,242.76 - - -
Company
Winteam Phar maceutical Group Ltd. 8,877.09 - 9,346.82 -
Sinopharm Group Zhijun(Shenzhen) 5,812.50 - 139,392.00 -
Pharmaceutical Co., Ltd.
Sinopharm Holding Jilin Co., Ltd. 4,267.77 - - -
Sinopharm Group Zhijun(Shenzhen) 778.62 - - -
Pingshan Pharmaceutical Co., Ltd.
Jiangsu Fuxing Pharmaceutical Trading 81.08 - 81.08 -
Co., Ltd
Sinopharm Holding Shanxi Co., Ltd. - - 3,890,993.71 -
Sinopharm Holding Shanxi Co., Ltd. - - 3,330,287.42 -
Sinopharm Holding Shanxi Lvliang Co., - - 660,000.00 -
Ltd.
Sinopharm Holding Beijing Co., Ltd. - - 123,809.52 -
Sinopharm Holding Fujian Co., Ltd. - - 225.81 -
Xinjiang Baitong Property Service Co., - - 16,856.89 -
Ltd.
Sinopharm Group Guizhou Blood - - 536,000.00 -
Products Co., Ltd.
Sinopharm Xinjiang Pharmaceutical Co., - - 45,432.69 -
Ltd.
Shanghai Modern Hasen (Shangqiu) - - 103,503.41 -
Pharmaceutical Co., Ltd.
Shanghai Shyndec Pharmaceutical - - 609,418.22 -
Marketing Co., Ltd.
Sinopharm Chuan Kang Pharmaceutical - - 346,772.59 -
Co., Ltd.
Fresenius Kabi Huarui Pharmaceuticals - - 1,231.58 -
Co., Ltd.
Shenyang Hongqi Pharmaceutical Co., - - 237,150.00 -
Ltd.
Linyi Medical Group Co., Ltd. - - 775,396.82 -
Hunan Minshengtang Investment Co., Ltd. - - 3,349,268.77 -
Taishan Xiangranhui Trade Co., Ltd - - 39,450.05 -
160
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
6. Amounts due from related parties (Continued)
Advances to suppliers(Continued) 30 June 2019 1 January 2019
Gross carrying Provision for Gross carrying Provision for bad
Related party amount bad debt amount debt
Nanjing Yuanguang Trading Co., Ltd. - - 169,697.02 -
7. Amounts due to related parties
Related party 30 June 2019 1 January 2019
Accounts payable
Sinopharm Holding Sub Marketing Center 195,937,772.42 104,262,822.63
Co., Ltd.
China National Medicines Co., Ltd. 62,209,906.16 48,352,935.82
Sinopharm Holding Shanxi Co., Ltd. 51,758,102.97 945,054.21
Sinopharm Holding Shanxi Co., Ltd. 31,832,547.24 -
Sinopharm Group Xinjiang Special Drugs 28,675,206.92 18,259,929.53
National Phar maceutical Co., Ltd.
Fresenius Kabi Huarui Pharmaceuticals 24,077,737.27 10,470,003.68
Co., Ltd.
Sinopharm Le-Ren-Tang Medicine Co., 21,572,062.09 -
Ltd.
Sinopharm Group 21,374,852.12 13,732,261.69
Jiangsu Wanbang Pharmacy Marketing 21,363,008.26 15,038,618.86
Co., Ltd.
Lanzhou Biotechnology Development Co., 20,100,000.00 -
Ltd.
Sinopharm Holding Lunan Co., Ltd. 16,885,035.59 71,599.97
Sinopharm Holding Shenyang Co., Ltd. 11,151,742.57 4,015,953.59
Sinopharm Holding Inner Mongolia Co., 10,342,153.14 2,225,947.78
Ltd.
Shenzhen Main Luck Pharmaceutical Co., 9,804,573.26 8,565,744.21
Ltd.
Sinopharm Holding Yangzhou Co., Ltd. 9,362,416.32 7,630,403.88
Sinopharm Holding Lerentang 8,517,232.26 8,402,288.43
Pharmaceutical Co., Ltd.
Tibet Yaoyou Medicines Co.,Ltd. 8,066,785.64 8,346,619.80
Sinopharm Holding Hubei Co., Ltd. 7,380,255.63 -
Jinzhou AoHong Pharmaceuticals Co., 7,121,913.42 2,422,868.00
Ltd.
Sinopharm Holding Beijing Co., Ltd. 6,747,587.35 7,478,006.36
Sinopharm Lerentang Shijiazhuang 6,179,335.72 183,737.13
Medicine Co., Ltd.
Winteam Phar maceutical Group Ltd. 6,143,556.76 6,294,519.81
Sinopharm Holding Fujian Co., Ltd. 5,942,354.78 4,484,641.23
161
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Accounts payable (Continued)
Sinopharm Group Zhijun(Shenzhen) 5,480,684.06 3,550,454.25
Pingshan Pharmaceutical Co., Ltd.
Sinopharm Group Zhijun(Shenzhen) 4,903,616.19 2,922,052.73
Pharmaceutical Co., Ltd.
Sinopharm Holding Jiangsu Co., Ltd. 4,884,948.33 6,745,253.51
Shenzhen Wanwei Medicine Trading Co., 4,704,357.80 4,219,138.81
Ltd.
Chongqing Yaoyou Pharmaceutical Co., 4,440,477.23 3,506,823.08
Ltd.
Sinopharm Holding Shandong Co., Ltd. 3,795,662.54 10,865.00
Sinopharm Holding Pingdingshan Co., 3,638,807.19 3,603,335.66
Ltd.
Sinopharm Holding Xinjiang Special Drugs 3,182,288.62 795,448.03
Western Pharmaceutical Co., Ltd.
Yichang Humanw ell Pharmaceutical Co., 3,022,607.79 1,936,090.54
Ltd.
Sinopharm Holding Xiamen Co., Ltd. 2,812,274.62 1,710,756.72
Sinopharm Holding Changzhou Co., Ltd. 2,732,668.55 1,484,634.49
Beijing Huasheng Pharmaceutical 2,630,700.01 637.01
Biotechnology Development Co., Ltd.
Sinopharm Holding Shanghai Likang 2,493,666.00 1,755,209.60
Pharmaceutical Co., Ltd.
Sinopharm Holding Ningxia Co., Ltd. 2,423,060.64 3,007,737.39
Sinopharm Lerentang Hebei Medical 2,265,517.01 1,519,045.91
Instrument Trade Co., Ltd.
Sinopharm Xingsha Phar maceuticals 2,257,975.91 966,925.12
(Xiamen) Co., Ltd.
Henan Wanxitang Pharmacy Co., Ltd. 2,041,958.50 2,053,637.44
China Otsuka Pharmaceutical Co., Ltd. 1,959,904.38 1,571,696.86
Sinopharm Holding Tongliao Co., Ltd. 1,758,793.98 872,644.61
Sichuan Hexin Pharmaceutical Co., Ltd. 1,685,255.64 454,536.00
Jiangxi Erye Medicine Marketing Co., Ltd. 1,673,658.34 262,590.49
Sinopharm Holding Heilongjiang Co., Ltd. 1,478,359.09 922,059.45
Sinopharm holdings Beijing huahong co., 1,373,387.43 1,498,601.00
Ltd
Sinopharm Yixin Pharmaceutical Co., Ltd. 1,339,719.99 175,855.31
Jiangsu Fuxing Pharmaceutical Trading 1,274,138.60 549,104.40
Co., Ltd
Sinopharm Holding Henan Co., Ltd. 1,265,401.40 1,441,223.83
Sinopharm Holding Jinan Co., Ltd. 1,251,027.35 189,250.47
Sinopharm Group Rongsheng 1,225,702.70 398,911.58
Pharmaceutical Co., Ltd.
Shenyang Hongqi Pharmaceutical Co., 1,162,650.62 1,191,792.10
Ltd.
Sinopharm Holding Wuxi Co., Ltd. 971,301.75 492,702.04
Sinopharm Holding Fuzhou Co., Ltd. 955,698.95 328,729.69
Sinopharm Holding Beijing Kangchen Bio- 926,405.95 917,154.80
162
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Accounts payable (Continued)
Pharmaceutical Co., Ltd.
Beijing Golden Elephant Fosun 891,429.22 1,050,690.44
Pharmaceutical Co., Ltd.
Sinopharm Holding Changzhou Medical 853,893.17 3,080,381.47
Logistics Center Co., Ltd.
Hunan Dongting Phar maceutical Co., Ltd. 795,952.06 265,365.25
Shyndec Pharmaceutical 696,904.24 511,528.32
Shanghai Chaohui Pharmaceutical Co., 694,598.86 311,797.36
Ltd.
Sinopharm Holding Hulun Buir Co., Ltd. 661,633.04 364,441.22
Chengdu Rongsheng Pharmacy Co., Ltd. 657,794.89 1,947,271.88
Chengdu Institute of Biological Products 655,200.00 370,800.00
Co.,Ltd.
Sinopharm Holding Suzhou Co., Ltd. 644,244.31 1,871,807.98
Sinopharm Holding Xinjiang Xinte 611,742.48 1,133,803.05
Karamay Pharmaceutical Co., Ltd.
China National Pharmaceutical Industry 588,962.54 363,778.78
Co., Ltd.
Sinopharm Holding Hainan Co., Ltd. 558,876.10 72,738.00
Guizhou Tongjitang Pharmaceutical Co., 558,859.22 342,846.28
Ltd.
Sinopharm Holding Donghong Medical 498,790.10 213,020.90
(Shanghai) Co., Ltd.
Sinopharm Holding Changsha Co., Ltd. 481,119.66 -
Huayi Phar maceutical Co., Ltd. 473,024.00 961,440.00
Suzhou Erye Pharmaceutical Limited 446,987.01 278,341.97
Company
Sinopharm Holding Xinjiang Special Drugs 445,108.34 350,668.16
Kashgar Pharmaceutical Co., Ltd.
Sinopharm Group Yibin Pharmaceuticals 431,253.60 150,034.94
Co., Ltd.
Foshan Fengliaoxing Pharmaceutical Co., 424,687.33 1,254,306.67
Ltd.
Sinopharm Group Southw est Medicine 401,710.17 194,982.00
Co., Ltd.
Wuhan Zhonglian Pharmaceutical Group 385,312.50 560,483.58
Co., Ltd.
Sinopharm Holding Hunan Co., Ltd. 362,310.86 7,718.24
Sinopharm Holding Lianyungang Co., Ltd. 353,590.00 276,118.64
Sinopharm Fengliaoxing (Foshan) 326,508.24 149.02
Medicines Co., Ltd.
Sinopharm Lingyun Biopharmaceutical 318,353.90 165,476.77
(Shanghai) Co., Ltd.
Shanghai Transfusion Technology Co., 311,860.00 352,100.00
Ltd.
Sinopharm Chuan Kang Pharmaceutical 310,881.30 472,481.64
Co., Ltd.
Sinopharm Holding Jinzhou Co., Ltd. 304,289.19 530,995.29
Jiangsu Huanghe Pharmaceutical Co., 284,275.55 261,207.05
163
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Accounts payable (Continued)
Ltd.
Sinopharm Holding Yangzhou Medical 282,295.93 55,877.68
Treatment Equipment Co., Ltd.
Sinopharm Holding Putian Co., Ltd. 274,267.65 7,144.64
Sinopharm Group Medicine Logistic Co., 267,956.64 -
Ltd.
Sinopharm Holding Zhihuiminsheng 266,517.35 -
(Tianjin) Pharmaceutical Co., Ltd.
Sinopharm Holding Dezhou Co., Ltd. 251,966.42 233,602.84
Sinopharm Group Guorui Medicine Co., 241,407.19 1,057,129.20
Ltd.
Sinopharm Holding Tianjin Co., Ltd. 233,292.17 15,615.31
Sinopharm Group (Tianjin) Eastern 231,523.37 -
Bokang Phar maceutical Co., Ltd.
Sinopharm Holding Yancheng Co., Ltd. 201,484.85 190,168.37
Sinopharm Holding Shanxi Zhidekang 165,906.67 139,969.67
Medicine Co., Ltd.
Shanghai Merro Pharmaceutical Co., Ltd. 161,072.33 90,275.31
Sinopharm Holding Hunan Phar maceutical 160,457.71 -
Development Co., Ltd.
Anhui Jingfang Pharmaceutical Co., Ltd. 148,041.15 165,171.12
Sinopharm Holding Anhui Co., Ltd. 139,702.67 18,589.18
Foshan Dezhong Pharmaceutical Co., Ltd. 139,274.51 98,835.01
Sinopharm Holding Dalian Co., Ltd. 136,272.27 182,516.75
Sinopharm Holding Bayannaoer Co., Ltd. 131,992.42 -
China National Pharmaceutical Foreign 122,930.63 122,930.63
Trade Corporation
Sinopharm Shantou Jinshi Pharmaceutical 120,579.21 102,693.04
Co., Ltd.
Sinopharm Holding Biopharmaceutical 108,541.17 20,509.50
(Tianjin) Co., Ltd.
Pudong New Area of Shanghai 106,921.13 91,493.10
Pharmaceutical Medicine Ltd.
China Medical Equipment Shandong Co., 106,382.80 -
Ltd.
Sinopharm Liaoning Medical Equipment 102,585.59 -
Co., Ltd.
The Fourth Phar maceutical Co., Ltd. of 92,151.64 97,099.70
Zhonglian Group
Sinopharm Holding Taizhou Co., Ltd. 76,424.00 99,508.00
Sinopharm Group Shanxi Medical Devices 75,016.66 -
Co., Ltd.
Sinopharm Holding Zhejiang Co., Ltd. 72,393.66 58,508.35
Shanghai Modern Hasen (Shangqiu) 67,745.54 57,148.85
Pharmaceutical Co., Ltd.
Sinopharm Holding Yangzhou Biological 64,687.73 50,162.16
Products Co., Ltd.
Shandong Lu Ya Pharmaceutical Co., Ltd. 52,819.07 52,819.07
164
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Accounts payable (Continued)
Sinopharm Xinjiang Pharmaceutical Co., 49,772.38 9,720.00
Ltd.
Sinopharm Holding Fuzhou Medical 46,000.00 -
Devices Co., Ltd.
Sinopharm Holding Nanjing Wende 44,682.80 102,437.80
Pharmaceutical Co.,Ltd.
Sinopharm Holding Ulanqab Co., Ltd. 44,330.00 61,246.80
Shantou Jinshi Pow der Injection Co., Ltd. 39,838.05 245,352.00
Sinopharm Holding Sanyi Medicine 33,085.44 25,483.57
(Wuhu) Co., Ltd.
Sinopharm Holding Rizhao Co., Ltd. 32,873.67 10,236.15
Beijing Huamiao Pharmaceutical Co., Ltd. 29,912.02 372,103.86
Sinopharm Holding Dalian Hecheng Co., 28,687.56 -
Ltd.
Guangdong Medi-World Phar maceutical 27,719.91 297,576.35
Co., Ltd.
Sinopharm Holding Quanzhou Co., Ltd. 26,085.88 62,947.60
Sinopharm Holding Shanxi Mingdikang 24,871.11 27,215.64
Medicine Co., Ltd.
Sinopharm Group Zhijun(Suzhou) 22,800.00 -
Pharmaceutical Co., Ltd.
Sinopharm Holding Yongzhou Co., Ltd. 19,809.36 19,858.72
Sinopharm Group Shanghai Medicine 16,603.02 16,603.02
Device Co., Ltd.
Sinopharm Holding Liaocheng Co., Ltd. 16,197.93 16,197.93
Sinopharm Holding Beijing Tianxing Puxin 13,891.78 84,524.54
Biological Medical Co., Ltd.
Sinopharm Holding Zhangzhou 11,760.00 -
Pharmaceutical Co., Ltd.
Sinopharm Group Shanxi Co., Ltd. 10,144.80 -
Sinopharm Group Anhui Medical Devices 5,200.00 -
Co., Ltd.
Changchun Changsheng Gene 3,017.20 1,492.91
Pharmaceutical Co., Ltd.
Sinopharm Holding Ordos Co., Ltd. 1,771.20 1,771.20
Sinopharm Holding Shanxi Jincheng Co., 1,659.94 3,846.13
Ltd.
Sinopharm Prospect Dentech (Beijing) 1,461.99 1,536.00
Co., Ltd.
Guilin South pharmaceutical Co., Ltd. 1,210.43 1,210.80
Sinopharm Holding Huaideju 1,113.85 1,113.85
Pharmaceutical (Xiamen) Co., Ltd.
Guizhou Tongjitang Pharmacy Chain Co., 991.50 -
Ltd.
Shenzhen Zhijun Pharmaceutical Trade 534.20 534.20
Co., Ltd.
Shanghai Shyndec Pharmaceutical 106.76 106.76
Marketing Co., Ltd.
Chongqing Haisiman Pharmaceutical Co., 101.91 101.91
Ltd.
165
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Accounts payable (Continued)
Sinopharm Holding Chongqing Co., Ltd. 45.00 45.00
Linyi Medical Group Co., Ltd. 10.47 10.47
Sinopharm Holding Xinyu Co., Ltd. 0.01 0.01
Sinopharm Holding Jilin Co., Ltd. - -
Sinopharm Holding Shanxi Instrument - 6,309,208.47
Branch Co., Ltd.
Sinopharm Holding Tianjin Distribution - 35.32
Center Co., Ltd.
Sinopharm Holding Zhangzhou Co., Ltd. - 5,472.50
Sinopharm Sichuan Phar maceutical Co., - 2,741.40
Ltd.
Sichuan Jiangyouzhongbafuzi Technology - 80,000.00
Development Co., Ltd.
Lanzhou Institute of Biological Products - 180,000.00
Co., Ltd.
Sinopharm Wuhan blood products Co., - 170,387.93
Ltd.
Hutchison Whampoa Sinopharm - 255,089.90
Pharmaceuticals (Shanghai) Co., Ltd.
Sinopharm ShanXi Ruifulai - 63,081.60
Pharmaceutical Co., Ltd.
Jiangsu Lianhuan Pharmaceutical Co., - 1,321,298.26
Ltd.
Qinghai Pharmaceutical Factory Co., Ltd. - 32,970.00
Jingfukang Pharmaceutical Group Co., - 184,438.44
Ltd.
Shanghai Sinopharm Pharmaceutical Co., - 92,610.00
Ltd.
Fujian Chentian Jinling Pharmaceutical - 505,555.00
Co., Ltd.
Related party 30 June 2019 1 January 2019
Notes payable
Sinopharm Holding Sub Marketing Center 116,044,638.24 230,067,443.17
Co., Ltd.
Sinopharm Holding Shenyang Co., Ltd. 65,065,373.01 76,894,045.21
Sinopharm Holding Inner Mongolia Co., 25,122,678.38 20,459,755.01
Ltd.
Sinopharm Group Xinjiang Special Drugs 18,119,677.13 13,887,657.53
National Phar maceutical Co., Ltd.
Sinopharm Holding Shanxi Co., Ltd. 7,725,000.00 67,926,610.30
166
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Notes payable (Continued)
Sinopharm Holding Fujian Co., Ltd. 7,114,576.43 7,011,034.30
Sinopharm Holding Lerentang 6,824,078.95 14,650,495.82
Pharmaceutical Co., Ltd.
Chongqing Yaoyou Pharmaceutical Co., 6,503,471.90 5,538,258.30
Ltd.
China National Medicines Co., Ltd. 5,851,346.28 26,654,608.10
Sinopharm Holding Xiamen Co., Ltd. 5,423,216.11 5,361,959.66
Chengdu Rongsheng Pharmacy Co., Ltd. 5,041,000.00 2,673,500.00
Lanzhou Biotechnology Development Co., 4,860,000.00 3,000,000.00
Ltd.
Sinopharm Lerentang Shijiazhuang 4,185,619.88 8,148,267.06
Medicine Co., Ltd.
Sinopharm Holding Jinzhou Co., Ltd. 2,493,839.62 1,611,340.65
Jiangsu Wanbang Pharmacy Marketing 2,439,745.89 4,817,408.42
Co., Ltd.
Sinopharm Holding Shanxi Co., Ltd. 2,082,000.00 18,340,013.80
Sinopharm Holding Hunan Co., Ltd. 2,043,558.46 3,114,143.15
Sinopharm Group Zhijun(Shenzhen) 1,856,344.00 325,741.92
Pharmaceutical Co., Ltd.
Shenzhen Wanwei Medicine Trading Co., 1,802,808.00 2,402,393.40
Ltd.
Shenzhen Main Luck Pharmaceutical Co., 1,769,052.60 2,877,350.00
Ltd.
Sinopharm Holding Ningxia Co., Ltd. 1,538,808.00 1,413,847.22
Sinopharm Holding Jinan Co., Ltd. 1,240,000.00 1,880,000.00
Sinopharm Xingsha Phar maceuticals 1,145,486.98 356,554.16
(Xiamen) Co., Ltd.
Sinopharm Group Shanxi Medical Devices 949,700.00 -
Co., Ltd.
Sinopharm Holding Dalian Co., Ltd. 857,791.87 950,169.80
Guangdong Medi-World Phar maceutical 755,306.20 -
Co., Ltd.
Guizhou Tongjitang Pharmaceutical Co., 632,834.40 -
Ltd.
Sinopharm Holding Changsha Co., Ltd. 632,325.90 -
Anhui Jingfang Pharmaceutical Co., Ltd. 409,923.80 -
Sinopharm Holding Changzhou Medical 400,000.00 1,000,000.00
Logistics Center Co., Ltd.
Shanghai Transfusion Technology Co., 301,800.00 503,000.00
Ltd.
Sinopharm Group Zhijun(Shenzhen) 262,800.00 -
Pingshan Pharmaceutical Co., Ltd.
Shyndec Pharmaceutical 255,516.40 475,780.40
Sinopharm Group Rongsheng 213,037.00 223,333.00
Pharmaceutical Co., Ltd.
Sinopharm Holding Quanzhou Co., Ltd. 205,791.15 170,891.70
Sinopharm Holding Putian Co., Ltd. 160,980.86 614,504.48
167
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Notes payable (Continued)
Sinopharm Holding Yancheng Co., Ltd. 160,000.00 -
Winteam Phar maceutical Group Ltd. 154,417.60 111,322.50
Sinopharm Yixin Pharmaceutical Co., Ltd. 107,472.00 394,064.00
Sinopharm Group - 1,183,604.16
Sinopharm Holding Shanxi Instrument - 1,981,189.60
Branch Co., Ltd.
Sinopharm Holding Lunan Co., Ltd. - 8,596,290.47
Sinopharm Holding Yangzhou Co., Ltd. - 626,534.40
Sinopharm Holding Heilongjiang Co., Ltd. - 31,320.00
Sinopharm Le-Ren-Tang Medicine Co., - 22,076,249.59
Ltd.
Foshan Fengliaoxing Pharmaceutical Co., - 320,310.10
Ltd.
Sinopharm Group Guizhou Blood - 536,000.00
Products Co., Ltd.
Lanzhou Institute of Biological Products - 6,236,153.40
Co., Ltd.
Shenyang Hongqi Pharmaceutical Co., - 602,172.00
Ltd.
Chongqing Haisiman Pharmaceutical Co., - 275,652.00
Ltd.
China Otsuka Pharmaceutical Co., Ltd. - 1,793,583.51
Jiangsu Lianhuan Pharmaceutical Co., - 522,071.08
Ltd.
Jingfukang Pharmaceutical Group Co., - 151,120.00
Ltd.
Fujian Chentian Jinling Pharmaceutical - 100,600.00
Co., Ltd.
168
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Other payables
Sinopharm Group Medicine Logistic Co., 11,518,140.63 2,278,301.79
Ltd.
Shanghai Dingqun Enterprise 10,000,000.00 10,000,000.00
Management Consulting Co., Ltd.
Sinopharm Chongqing Phar maceutical 5,173,229.10 5,943,030.80
and Medical Industry Design Institute
Sinopharm Group 3,842,067.59 3,706,406.59
Sinopharm Group Shanghai Co., Ltd. 1,690,992.16 1,660,431.38
China National of Traditional&Herbal 1,300,000.00 1,300,000.00
Medicine Co., Ltd.
Sinopharm Holding Tianjin Binhai 387,617.70 339,760.00
Pharmaceutical Co., Ltd.
Shyndec Pharmaceutical 327,973.63 327,973.63
Shanghai Beiyi Guoda pharmaceutical Co. 195,898.04 566,180.09
Ltd.
Sinopharm Holding Hunan Weian 97,305.00 30,000.00
Pharmacy Medicine Chain Company
Limited
Sinopharm Group Xinjiang Special Drugs 76,540.19 41,794.27
National Phar maceutical Co., Ltd.
Sinopharm Holding Sub Marketing Center 37,782.33 37,782.33
Co., Ltd.
Xinjiang Baitong Property Service Co., 33,713.74 -
Ltd.
China National Pharmaceutical Logistics 10,349.70 10,349.70
Co., Ltd.
Sinopharm Group Medicine Logistic Co., - 18,650.00
Ltd. Guangzhou Branch
Sinopharm Holding Financing Lease Co., - 4,424,970.21
Ltd.
Heyuan Mairui Trading Co., Ltd. - 672,396.36
Shenyang Pharmaceutical Co., Ltd. - 4,419,166.69
Linyi Medical Group Co., Ltd. - 51,398.45
Zhang Zhenfang - 2,309,999.96
Pingdingshan Pusheng Pharmaceutical - 1,246,412.02
Co., Ltd.
169
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
7. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Contract liability
Sinopharm Holding Quanzhou Co., Ltd. 111,943.09 10,088.00
Sinopharm Holding Inner Mongolia Co., 23,021.80 23,021.80
Ltd.
Sinopharm Holding Jiangxi Co., Ltd. 22,924.91 34,334.51
Sinopharm Holding Gansu Co., Ltd. 21,960.00 -
China Otsuka Pharmaceutical Co., Ltd. 20,475.00 -
China National Pharmaceutical Foreign 2,727.23 1,495.33
Trade Corporation
Sinopharm Holding Chengdu Co., Ltd. 851.59 851.59
Sinopharm Holding Chongqing Co., Ltd. 755.62 755.62
Sinopharm Group Guangdong Medicine 639.92 1,599.80
Device Co., Ltd.
Sinopharm Holding Taizhou Co., Ltd. 24.80 -
Sinopharm Holding Jinzhou Co., Ltd. 0.19 -
Sinopharm Holding Hunan Co., Ltd. - 87,764.97
Sinopharm Holding Hunan Weian - 67,305.00
Pharmacy Medicine Chain Company
Limited
Sinopharm Xinxiang Chain Store Co., Ltd. - 0.01
Sinopharm Holding Yunnan Co., Ltd. - 11,900.19
Sinopharm Holding Nantong Co., Ltd. - 143,177.12
Sinopharm Sichuan Phar maceutical Co., - 1,123,087.93
Ltd.
Sinopharm Medical Instrument Guizhou - 93.60
Qiannan Co., Ltd.
Sinopharm Zhuhai Medical Instrument - 3,719.00
Co., Ltd.
Sinopharm Health Online Co., Ltd. - 416,056.44
Sinopharm Holding Hulun Buir Co., Ltd. - 21,177.25
Sinopharm Holding Huaian Co., Ltd. - 19.40
170
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Interest receivable
Sinopharm Group Zhijun(Suzhou) Pharmaceutical Co., Ltd. 1,484,841.22 1,846,618.96
Interest payable
Group Financial Co. 98,338.84 -
CNPGC 35,440.21 38,984.25
Other non-current assets
Hunan Minshengtang Investment Co., Ltd. - 3,519,217.54
Lease liability
Beijing Golden Elephant Fosun Phar maceutical Co., Ltd. 51,477,662.49 -
Lerentang Investment Group Co., Ltd. 15,361,691.91 -
Linyi Medical Group Co., Ltd. 7,333,666.98 2,214,094.34
Sinopharm Holding Financing Lease Co., Ltd. 6,824,613.01 9,625,302.89
Guangdong Jiyuantang Development Co., Ltd. 5,895,887.17 6,679,233.35
Sinopharm Holding Yangzhou Co., Ltd. 5,440,115.48 7,178,262.00
Taishan Xiangranhui Trade Co., Ltd 2,506,316.51 2,834,391.56
Gu Jinhua 2,091,695.72 2,224,810.30
Nanjing Yuanguang Trading Co., Ltd. 1,979,076.07 2,675,365.64
Shenyang Pharmaceutical Co., Ltd. 1,685,513.08 1,885,957.03
Shaoguan Wujiang District Muyang Medicine Information
Consultant Co., Ltd. 996,884.75 1,441,844.49
Sinopharm Group 917,838.40 1,156,090.31
Sinopharm Holding Beijing Co., Ltd. 866,374.99 1,094,397.22
Gu Haiqun 686,419.59 766,279.30
Beijing Sinophar m Tianyuan Real Estate & Property
Management Co., Ltd. 506,243.41 652,436.66
Hangzhou Xihu Business Group Corporation 422,980.77 553,514.61
China National Medicines Co., Ltd. 417,186.76 550,480.20
Shenzhen Jiufeng Investment Co., Ltd. 385,892.93 377,758.33
171
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Related party 30 June 2019 1 January 2019
Entrusted loan
CNPGC - 31,600,000.00
Other non-current liabilities
Sinopharm Group - 35,061,743.31
short-term loan
Group Financial Co. 111,418,168.96 122,426,393.33
Long-term payables
Sinopharm Holding Financing Lease Co., Ltd. - 3,763,978.52
Non-current liabilities due w ithin one year
CNPGC 31,600,000.00 -
Beijing Golden Elephant Fosun Phar maceutical Co., Ltd. 9,673,454.33 9,206,427.16
Lerentang Investment Group Co., Ltd. 8,032,346.40 5,822,550.02
Sinopharm Holding Financing Lease Co., Ltd. 6,157,645.87 5,861,324.37
Sinopharm Holding Yangzhou Co., Ltd. 3,587,508.60 3,512,206.10
Guangdong Jiyuantang Development Co., Ltd. 1,752,116.60 1,649,377.54
Linyi Medical Group Co., Ltd. 1,450,117.00 1,549,099.93
Nanjing Yuanguang Trading Co., Ltd. 1,407,714.78 1,163,845.57
Shaoguan Wujiang District Muyang Medicine Information
Consultant Co., Ltd. 918,533.66 899,216.52
Taishan Xiangranhui Trade Co., Ltd 657,171.76 660,453.69
Sinopharm Group 491,639.09 481,344.63
Sinopharm Holding Beijing Co., Ltd. 477,779.78 460,701.48
Shenyang Pharmaceutical Co., Ltd. 428,258.20 404,634.11
Beijing Sinophar m Tianyuan Real Estate & Property
Management Co., Ltd. 325,813.14 295,389.79
Hangzhou Xihu Business Group Corporation 276,559.91 263,776.29
China National Medicines Co., Ltd. 275,115.69 269,340.95
Gu Jinhua 273,920.39 268,369.48
Shenzhen Jiufeng Investment Co., Ltd. 188,790.90 184,833.91
Gu Haiqun 168,618.03 161,206.64
Cash deposite with a related party
Group Financial Co. 11,759,504.84 2,125,351.39
172
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XI Commitments and contingencie s
1. Commitments
(1) Capital commitments
Capit al expenditures contracted for at the balance sheet date but not recognized in balance sheet
are analyzed as follows:
30 June 2019 31 December 2018
RMB‘0,000 RMB‘0,000
Buildings, machinery and equipment 2,196.50 42.16
Investment commitments (Not e) 6,000.00 6,000.00
8,196.50 6,042.16
Note: The Group subscribed to Sinopharm Zhongjin medical industry fund as its limited partner,and the
total investment amounted to RMB200 million. The investors contribute year by year in batch. The fund
manager will send out payment notification to investors according to the actual progress of the project
and the investors will commit to complete the payment in 3 year. The investors have paid 30% of the
amount of contribution during 2017, namely RMB60 million, and 40% in 2018, amounting to RMB80
million. The remaining payment amount is RMB60 million. .
2. Contingencie s
As of the balance sheet date, there were no contingencies that the Group was required to disclose.
173
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XII Other significant events
1. Segment reporting
Operating segments
For management purpose, the Group is organized into business units based on its
product and service and has four reportable operating segments as follows:
a) The Head Office, which is mainly engaged in investing and managing business;
b) Pharmaceutical distribution segment, which is mainly engaged in the
distribution of medicine and pharmaceutical products to customers;
c) Retail pharmacy segment, which is the managing the operation of Guoda
Pharmacy;
Management monitors the results of the Group’s operating segments separately for the
purpose of making decisions about resource allocation and performance assessment.
Segment performance is evaluated based on reportable segment profit, which is a
measure of adjusted profit before tax. The adjusted profit before tax is measured
consistently with the Group’s profit before tax except that finance costs, dividend
income, non-operating income, non-operating expense, investment income, as well as
head office and corporate expenses are excluded from such measurement.
Inter-segment sales and transfers are transacted with reference to the selling prices
used in the transactions carried out with third parties at the then prevailing market
prices.
174
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XII Other significant events (Continued)
2. Segment reporting (Continued)
Operating segments (Continued)
Operating segment information as at and for the semi year ended
Pharmaceutical Elimination between
Head Office Ret ail Tot al
distribution segments
Revenue of main operat ions - 19, 442, 945, 442. 54 5, 957, 083, 892. 95 (359, 409, 396. 51) 25, 040, 619, 938. 98
Cost of main operations - (18, 238, 282, 841. 05) (4, 518, 680, 260. 83) 358, 635, 569. 45 (22, 398, 327, 532. 43)
Investment income 169, 889, 995. 08 (995, 293. 58) 247, 588. 49 - 169, 142, 289. 99
Net profit 607, 413, 658. 42 403, 231, 513. 97 186, 189, 865. 75 (428, 742, 482. 83) 768, 092, 555. 31
Total assets 11, 863, 959, 776. 81 20, 784, 963, 352. 57 10, 847, 813, 404. 32 (9, 957, 137, 850. 76) 33, 539, 598, 682. 94
Total liabilities (2, 406, 658, 554. 25) (15, 349, 630, 522. 38) (5, 670, 681, 594. 90) 4, 445, 868, 231. 85 (18, 981, 102, 439. 68)
175
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key item s of the company financial statements
1. Accounts receivable
The accounts receivable by category are analyzed below:
30 J une 2019 1 Januar y 2019
Gross carryi ng amount Provision for bad debt Gross carryi ng amount Provision for bad debt
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Items for which
provision for bad
debt is recognis ed
separatel y 19,207,761.36 3.15% 161,522.25 0.84% 17,846,941.30 2.83% - -
Items for which
provision for bad
debt is recogniz ed
by the company
(credit risk
characteristics) 591,029,383.80 96.85% - - 613,389,652.64 97.17% - -
610,237,145.16 100.00% 161,522.25 0.03% 631,236,593.94 100.00% - -
At 30 June 2019, accounts receivable that are individually signif icant and individually assessed for provisions are as
follows:
Accounts receiv able(by Bad debt
company) Carrying amount provis ion Rate Assessment for impairment
Receivable due from a related party
Receivable of related party 18,884,716.86 - 0.00% with low risk of recoverability
The customer has poor management
Shenzhen Dongtai and bad financial situation with hi
Pharmaceutical Co., Ltd. 323,044.50 161,522.25 50.00% gh risk of recoverability
Total 19,207,761.36 161,522.25
Provision for bad debts of accounts receivable according to the general model of expected credit
loss:
30 June 2019
Expected credit loss in entire
Estimated def ault amount lif etime Expected credit loss rate
Within 1 year 591,029,383.80 - -
591,029,383.80 - -
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key items of the company financial statements (Continued)
1. Accounts receivable (Continued)
The aging analysis of accounts receivables was as follows:
30 June 2019
Within 1 year 610,237,145.16
Total
610,237,145.16
Bad debt provision for the current period as follows:
Reversal of write-
Opening Reversal in the Written off Closing
off in previous Increases in the year
balance year in the year balance
years
Bad debts - - 161,522.25 - - 161,522.25
Total - - 161,522.25 - - 161,522.25
On 30 June 2019, the top five accounts receivable by customer are summarised below:
Bad debt provision % of the total accounts
Amount amount receivable
The top five accounts
receivable total 117,550,911.53 - 19.26%
On 30 June 2019, the Company's accounts receivable that were terminated due to the
cooperation on accounts receivable factoring with financial institutions without recourse were RMB
183,988,184.79.
177
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key items of the company financial statements (Continued)
2. Other receivables
30 June 2019 1 January 2019
Interest receivable 14,926,690.76 7,550,877.07
Dividend rec eivable 106,074,898.00 -
Other receivables 1,737,482,983.84 1,534,430,006.43
1,858,484,572.60 1,541,980,883.50
（ 1） Interest receivable
30 June 2019 1 January 2019
Fixed deposits 11,411,000.00 3,697,083.33
Entrusted Loans 3,515,690.76 3,853,793.74
14,926,690.76 7,550,877.07
（ 2） Dividend receivable
30 June 2019 1 January 2019
Sinopharm Holding Shenzhen Logistics
Co., Ltd. 1,332,303.75 -
Sinopharm Holding Shenzhen Traditional
& Herbal Medicine Co., Ltd 245,732.05 -
Shenzhen Jianmin Pharmaceutical Co.,
Ltd. 2,260,593.51 -
Sinopharm Holding Guangzhou Co., Ltd 71,642,571.23 -
Sinopharm Holding Guangxi Co., Ltd 30,593,697.46 -
106,074,898.00 -
（ 3） Other receivables
Category of other receivables by nature is as follows:
Nature 30 June 2019 1 January 2019
Receivable due from related parties 1,721,317,102.80 1,469,192,387.91
Receivable of equity transactions 8,980,000.00 8,980,000.00
Deposits 436,311.09 1,449,978.94
Others 17,964,114.36 63,817,941.16
Total 1,748,697,528.25 1,543,440,308.01
178
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key item s of the company financial statements (Continued)
2. Other receivables (Continued)
The changes in bad debt provision for other receivables based on the entire lifetime expected
credit losses are as follows:
Stage 1 Stage 2 Stage 3
Bad debt Expected credit Entire lifetime Entire lifetime expected Total
losses over the expected credit credit losses(Credit
next 12 months losses(No credit impairment occurred)
impairment occurred)
Balance at 1 January 2019 - 9,010,301.58 - 9,010,301.58
Balance at 1 January 2019
during the period
Provisions during the
period - 2,204,412.83 - 2,204,412.83
Reversal during the period - (170.00) - (170.00)
Balance at 30 June 2019 - 11,214,544.41 - 11,214,544.41
The aging analysis of other receivables was as follows:
30 June 2019
Within 1 year 1,689,730,979.74
1 to 2 years 49,856,902.50
2 to 3 years 29,829.20
Over 3 years 9,079,816.81
Total 1,748,697,528.25
Bad debt provision of ot her receivables in 2019 was RMB2,204,412.83, with the recovered or reversed
amount of RMB170.00.
179
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key items of the company financial statements (Continued)
2. Other receivables (Continued)
As at 30 June 2019，the top 5 parties that owed the largest amounts of other rec eivable balances
are analyzed below:
% of total Provision of bad
Nature Amount Age
amount debt
Sinopharm Guangxi Entrusted borrow ings 343,000,000.00 Within 1 year 19.61%
Sinopharm Yuexing Entrusted borrow ings 190,700,000.00 Within 1 year 10.91%
Sinopharm Holding
Dongguan Co., Ltd. Entrusted borrow ings 161,000,000.00 Within 1 year 9.21%
Sinopharm Holdings
Zhanjiang Co., Ltd. Entrusted borrow ings 117,000,000.00 Within 1 year 6.69%
Sinopharm Holding
Meizhou Co., Ltd. Entrusted borrow ings 76,700,000.00 Within 1 year 4.39%
888,400,000.00 50.81%
3. Long-term equity inve stments
30 June 2019 1 January 2019
Bad debt Bad debt
Original v alue prov ision Carry ing amount Original v alue prov ision Carry ing amount
Inv estments
in
subsidiaries 5,594,679,427.58 - 5,594,679,427.58 5,594,679,427.58 - 5,594,679,427.58
Inv estments
in
associates 2,084,966,116.97 39,930,000.00 2,045,036,116.97 1,878,157,264.66 39,930,000.00 1,838,227,264.66
7,679,645,544.55 39,930,000.00 7,639,715,544.55 7,472,836,692.24 39,930,000.00 7,432,906,692.24
180
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key items of the company financial statements (Continued)
3. Long-term equity inve stments (Continued)
(a) Subsidiaries
Provision for Ending value of
impairment in the impairment
1 Januar y 2019 Increas es decreas e 30 J une 2019 current period provision
Sinophar m Jianmi ng 60,054,911.04 - - 60,054,911.04 - -
Sinophar m Traditi onal &
- -
Herbal Medicine 15,450,875.93 - - 15,450,875.93
Shenzhen Logistics 5,019,062.68 - - 5,019,062.68 - -
Sinophar m Guangzhou 3,588,689,716.80 - - 3,588,689,716.80 - -
Sinophar m Guangxi 525,456,951.07 - - 525,456,951.07 - -
Sinophar m Yanfeng 38,207,800.00 - - 38,207,800.00 - -
Sinophar m Holdi ng
Guoda Phar mac y Co.,
Ltd. 1,361,800,110.06 - - 1,361,800,110.06 - -
5,594,679,427.58 - - 5,594,679,427.58 - -
(b) Associates
Mo vement
Profit or loss under Other changes in Dividend Provision of
1 January 20 19 Investment the equity method equity declared Other 30 June 2019 impairment
Sinopharm Group Z hijun (Suzhou )
Pharmaceutical Co., Ltd. 39,930,000.00 - - - - - 39,930,000.00 39,930,000.00
Shenzhen Main Luc k Pharmaceutical
Co., Ltd 265,316,653.68 - 33,592,995.70 - - - 298,909,649.38
Sinopharm Group Z hijun (Shenzhen )
Pharmaceutical Co., Ltd. 355,353,196.15 - 58,536,101.74 - - - 413,889,297.89 -
Shenzhen Zhijun Pharmaceutical
T rade Co., Ltd.
8,730,994.87 - 1,467,031.77 - - - 10,198,026.64 -
Sinopharm Group Z hijun(Shenzhen )
Pingshan Pharmaceutical Co.,
Ltd. 86,292,927.33 - 22,425,900.45 - - - 108,718,827.78 -
Shanghai Shyndec Pharmaceutical
Co., Ltd. 1,098,566,852.51 - 65,258,503.45 42,424,747.00 (16,896,427.80 ) - 1,189,353,675.16 -
Shanghai Dingqun Enterprise
Manag ement Consulting Co., Ltd. 23,966,640.12 - - - - - 23,966,640.12 -
1,878,157,264.66 - 181,280,533.11 42,424,747.00 (16,896,427.80 ) - 2,084,966,116.97 39,930,000.00
181
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key items of the company financial statements (Continued)
4. Sales and cost of sales
For the six months ended For the six months ended
30 June 2019 30 June 2018
Revenue Cost Revenue Cost
Principal
operations 1,997,575,365.19 1,915,240,571.14 1,681,220,169.43 1,612,710,688.13
Other
operations 10,429,198.11 6,031,823.62 6,401,186.40 2,006,785.78
2,008,004,563.30 1,921,272,394.76 1,687,621,355.83 1,614,717,473.91
Classification For the six months ended
30 June 2019
By product
Include:
Medicines 1,919,165,623.70
Medical appliance 78,409,741.49
Other 10,429,198.11
By area
Include:
Domestic 2,008,004,563.30
Overseas
By contract duration
Include:
Confirm revenue at a certain point in time 1,997,575,365.19
Confirm revenue at a certain time period
10,429,198.11
Total 2,008,004,563.30
Information about the Company’s obligations is as follows:
The Company recognises revenue when goods are delivered, and will receive payment within 30-210 days.
The Company recognises revenue after providing services, and will receive payment within 30 -210 days.
The expected revenue recognition time for the Company’s contract obligations above is in year 20 19.
Information related to the sales price allocated to the remaining obligations:
The amount of income corresponding to the obligation that has been signed but has not been fulfilled or has
not yet fulfilled is9,058,538.51 yuan, of which 9,058,538.51 yua n is expected to be recognized in 2019.
182
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Notes to financial statements (Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIII Notes to key items of the company financial statements (Continued)
5. Investment income
For the six months ended For the six months ended
30 June 2019 30 June 2018
Long-term equity investment
income calculated by cost method 427,007,887.36 361,514,454.32
Long-term equity investment income
181,280,533.11 173,326,290.14
calculated by equity method
608,288,420.47 534,840,744.46
183
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Supplementary information to financial statements
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIV Supplementary information to financial statements
1. Schedule of non-recurring profi t or loss
Amount for 30 June 2019 Illustration
Gains and losses from disposal of non-current assets,
including write off of accrued asset impairment 4,318.22 .
Government grants recognized in income statement for the
current year, except for those closely related to the ordinary Mainly contains tax
operation of the Company which the Group enjoyed constantly subsidies and financial
according to the allotment standards or quantitative criteria of incentives received during
the country 16,456,976.15 current period
Reversal of bad debt provision for accounts receivable that were
tested for impairment individually 1,076,222.62
The interest income from
the entrusted loan provided
to Sinopharm Group Zhijun
(Suzhou) Pharmaceutical
Profit or loss from outward entrusted borrowings 1,715,338.06 Co., Ltd.
Non-operating income and expenses other than the aforesaid
items 519,920.40
Other 16,447.15
Less:Impact on income tax 4,668,084.55
Impact on non-controlling interests after tax 3,988,225.60
11,132,912.45
Basis for preparation of det ailed list of non-rec urring profit or loss items:
Under t he requirements in Explanatory announcement No. 1 on information disclosure by companies
offering securities to the public – non-recurring profit or loss (2008) (“Explanatory announc ement
No.1”) from CS RC, nonrecurring profit or loss refer to t hose arising from transactions and events that
are not directly relevant to ordinary business, or that are relevant to ordinary business, but are so
extraordinary that would have an influence on users of fin ancial statements making proper judgments
on the performance and profitability of an enterpris e.
183
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
Appendix(Continued)
For the six months ended 30 June 2019
(All amounts in Renminbi “RMB” unless otherwise stated)
XIV Supplementary information to financial statements (Continued)
2. Return on equity (“ROE”) and earnings per share (“EPS”)
Weighted Basic EPS (RMB/Share)
average
ROE (%) Basic Diluted
EPS(RMB/Share) EPS(RMB/Share)
Net profit attributable to ordinary
shareholders of the parent 5.44% 1.52 1.52
Net profit after deducting non-recurring
profit or loss attributable to the
Company’s ordinary shareholders of the
parent 5.35% 1.49 1.49
China National Accord Medicines Corporation Ltd.
Legal representative: Lin Zhaoxiong
24 August 2019
185
