China National Accord Medicines Corporation Ltd.
Annual Report 2020
April 2021
1
Section I. Important Notice, Contents and Interpretation
Board of Directors, Supervisory Committee, all directors, supervisors and senior
executives of China National Accord Medicines Corporation Ltd. (hereinafter
referred to as the Company) hereby confirm that there are no any fictitious
statements, misleading statements, or important omissions carried in this report,
and shall take all responsibilities, individual and/or joint, for the reality,
accuracy and completion of the whole contents.
Lin Zhaoxiong, Principal of the Company, Gu Guolin, person in charger of
accounting works and Wang Ying, person in charge of accounting organ
(accounting principal) hereby confirm that the Financial Report of 2020 Annual
Report is authentic, accurate and complete.
Other directors attending the Meeting for annual report deliberation except for
the followed
Name of director absent Title for absent director Reasons for absent Attorney
Su Weiwei Independent Director Official business Chen Honghui
The profit distribution plan that deliberated and approved by the Board is:
based on total stock issued 428,126,983 shares, distributed 8.00 Yuan (tax
included) bonus in cash for every 10-share hold by all shareholders, 0 shares
bonus issued (tax included) and no capitalizing of common reserves carried out.
2
Contents
Section I Important Notice, Contents and Interpretation .............................................................. 2
Section II Company Profile and Main Financial Indexes .............................................................. 5
Section III Summary of Company Business .................................................................................. 11
Section IV Discussion and Analysis of the Operation ................................................................... 15
Section V Important Events ............................................................................................................ 44
Section VI Changes in shares and particular about shareholders ............................................... 79
Section VII Preferred Stock ............................................................................................................ 90
section VIII Convertible Bonds.......................................................................................................91
Section IX Particulars about Directors, Supervisors, Senior Executives and Employees ......... 92
Section X Corporate Governance ................................................................................................. 105
Section XI Corporate bond ........................................................................................................... 114
Section XII Financial Report ........................................................................................................ 115
Section XIII Documents available for reference ......................................................................... 388
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Interpretation
Items Refers to Contents
Listed Company, Company, the Company,
Refers to China National Accord Medicines Corporation Ltd.
Sinopharm Accord, the Group
“SINOPHARM” or “CNPGC” Refers to China National Pharmaceutical Group Corporation
Sinopharm Group Co., Ltd, Controlling shareholder of the
Sinopharm Holding Refers to
Company
Company Law Refers to Company Law of the People’s Republic of China
Securities Law Refers to Securities Law of the People’s Republic of China
Yuan, 10 thousand Yuan, 100 million Yuan Refers to RMB, RMB 10 thousand, RMB 100 million
Terminology: Refers to
SPD hospital logistics supply chain extension business, IVD
4D business Refers to diagnostic reagent business, CSSD disinfection service, and
MWD equipment life cycle management business
GPO Refers to Group purchasing organizations
Abbreviation: Refers to
Sinopharm Holding Guangzhou Refers to Sinopharm Holding Guangzhou Co., Ltd.
“Guoda Drugstore” or “Guoda Pharmacy” Refers to Sinopharm Holding Guoda Drugstore Co., Ltd.
Sinopharm Holding Guangxi Refers to Sinopharm Holding Guangxi Co., Ltd.
China National Zhijun Refers to China National Zhijun (Shenzhen) Pharmaceutical Co., Ltd.
Zhijun Pharmacy Trade Refers to Shenzhen Zhijun Pharmacy Trade Co., Ltd.
China National Zhijun (Shenzhen) Pingshan Pharmaceutical Co.,
Zhijun Pingshan Refers to
Ltd.
Main Luck Pharmaceuticals Refers to Shenzhen Main Luck Pharmaceuticals Inc.
4
Section II Company Profile and Main Financial Indexes
I. Company profile
Short form of the stock Sinopharm Accord, Accord B Stock code 000028, 200028
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in
国药集团一致药业股份有限公司
Chinese)
Short form of the Company
国药一致
(in Chinese)
Foreign name of the Company
China National Accord Medicines Corporation Ltd.
(if applicable)
Short form of foreign name of
Sinopharm Accord
the Company (if applicable)
Legal representative Lin Zhaoxiong
Registrations add. Accord Pharm. Bldg , No. 15, Ba Gua Si Road, Futian District, Shenzhen, Guangdong Province
Code for registrations add 518029
Offices add. Accord Pharm. Bldg, No. 15, Ba Gua Si Road, Futian District, Shenzhen, Guangdong Province
Codes for office add. 518029
Company’s Internet Web Site http://www.szaccord.com.cn
E-mail gyyz0028@sinopharm.com
II. Person/Way to contact
Secretary of the Board Securities affairs representative
Name Chen Changbing Wang Zhaoyu
Accord Pharm. Bldg., No. 15, Ba Gua Si Accord Pharm. Bldg., No. 15, Ba Gua Si
Contact add. Road, Futian District, Shenzhen, Road, Futian District, Shenzhen,
Guangdong Province Guangdong Province
Tel. +(86)755 25875195 +(86)755 25875222
Fax. +(86)755 25195435 +(86)755 25195435
E-mail gyyzinvestor@sinopharm.com gyyz0028@sinopharm.com
III. Information disclosure and preparation place
Newspaper appointed for information disclosure Securities Times; China Securities Journal; Hong Kong Commercial Daily
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Website for annual report publish appointed by CSRC http://www.szse.cn ； http://www.cninfo.com.cn
Preparation place for annual report Secretariat of the Board of Directors
IV. Registration changes of the Company
Organization code 91440300192186267U
Changes of main business since listing (if
No change.
applicable)
Previous changes for controlling
No change.
shareholders (if applicable)
V. Other relevant information
CPA engaged by the Company
Name of CPA Ernst & Young CPA (Special General partnership)
Offices add. for CPA 21/F, China Resources Building, No. 5001, Shennan East Road, Luohu District, Shenzhen
Signing accountant Li Jianguang, Li Yuanfeng
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
VI. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data
√Yes □No
Cause of retroactive adjustment or restatement
Enterprises combined under the same control (Note 1)
Changes
2019 over last 2018
year
2020
After
Before adjustment After adjustment adjustme Before adjustment After adjustment
nt
Operating revenue (RMB) 59,649,455,012.03 52,045,764,143.21 52,786,807,476.28 13.00% 43,122,385,521.23 43,858,500,106.45
Net profit attributable to
shareholders of the listed 1,401,892,593.23 1,271,289,183.01 1,267,931,291.32 10.57% 1,210,742,435.78 1,208,343,941.71
Company (RMB)
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Net profit attributable to
shareholders of the listed
Company after deducting 1,369,652,035.50 1,226,765,271.97 1,226,765,271.97 11.65% 1,175,971,967.39 1,175,971,967.39
non-recurring gains and losses
(RMB) (Note 2)
Net cash flows from operating
1,502,746,598.47 2,000,352,083.20 2,012,653,189.74 -25.34% 1,322,606,352.27 1,338,639,227.25
activities (RMB)
Basic earnings per share
3.27 2.97 2.96 10.47% 2.83 2.82
(RMB/Share) (Note 2)
Diluted earnings per share
3.27 2.97 2.96 10.47% 2.83 2.82
(RMB/Share)
0.18
percenta
Weighted average ROE
10.49% 10.43% 10.31% ge 11.56% 11.41%
(Note 2)
points
up
Changes
over end
Year-end of 2019 Year-end of 2018
of last
Year-end of 2020 year
After
Before Before
After adjustment adjustme After adjustment
adjustment adjustment
nt
33,520,609, 28,930,300,
Total assets (RMB) 39,594,533,471.65 34,028,843,214.20 16.36% 29,450,897,487.81
123.67 519.97
Net assets attributable to
12,806,410, 11,618,432,
shareholder of listed company 13,948,322,652.33 12,911,140,435.88 8.03% 11,726,520,064.93
865.92 603.28
(RMB)
Note 1: The Group acquired 75.00% equity of Shanghai Pudong New Area Medicine & Medication Co., Ltd. under the same control
in the current year. When preparing the comparative statement of the consolidated statement for year of 2020, it is deemed that the
parties involved in the merger already exist in the current state when the ultimate controlling party begins to exercise control, and
adjust the previous comparative statement.
Note 2: Net profit attributable to shareholders of listed companies increased by 10.57% from the same period of last year, mainly due
to the soaring sales from pharmaceutical retail business, and the impact of mergers and acquisitions on incremental performance,
the basic earnings per share increased by 10.47% correspondingly and weighted average return on equity increased by 0.18
percentage points.
The lower one of net profit before and after deducting the extraordinary gains/losses in the last three fiscal years is negative, and the
audit report of last year shows that the ability to continue operating is uncertain
□Yes √No
The lower one of net profit before and after deducting the extraordinary gains/losses is negative
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□Yes √No
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International
Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or
Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VIII. Quarterly main financial index
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating revenue 12,824,196,278.66 14,345,743,909.86 15,710,564,937.11 16,768,949,886.40
Net profit attributable to
248,800,655.88 394,650,924.71 354,134,165.83 404,306,846.81
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
241,724,850.95 385,292,168.50 354,311,453.14 388,323,562.91
after deducting non-recurring gains
and losses
Net cash flows from operating
-688,273,848.63 2,126,477,891.98 545,143,142.89 -480,600,587.77
activities
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in the company’s quarterly report and semi-annual report
□ Yes √ No
IX. Items and amounts of extraordinary profit (gains)/loss
√Applicable □ Not applicable
In RMB
Item 2020 2019 2018 Note
Gains/losses from the disposal of The gains from fixed
5,969,522.10 2,340,925.97 7,048,337.10
non-current asset (including the write-off assets disposal .
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that accrued for impairment of assets)
Governmental subsidy reckoned into current Mainly for receiving
gains/losses (not including the subsidy of all kinds of special
enjoyed in quota or ration according to 65,568,137.35 49,299,242.48 30,098,383.86 subsidies and fiscal
national standards, which are closely interest discount in the
relevant to enterprise’s business) period.
Investment costs while acquiring
subsidiaries, joint ventures and associated Negative goodwill
enterprise, less than fair value of the 70.96 14.65 729.29 from subsidiary
identifiable net assets from invested acquisition.
enterprise which should be enjoined
Current net gain/losses of the subsidiary
merger under the same control from - -4,059,241.89 4,703,735.76
beginning of the period to combination date
Switch back of provision for depreciation of
account receivable and contract assets that 578,362.65 1,310,345.38 5,301,091.66
are individually tested for impairment
Gains and losses from external entrusted
- 3,460,037.16 3,246,925.69
loans
Consigning fee received for consigned
961,488.75 - 516,929.44
operation
The non-operating
expenditure
recognized from the
litigation
Other non-operating income and expenditure compensation in the
-11,819,894.60 17,179,002.78 5,069,438.37
except for the aforementioned items Period, and the
non-operating income
recognized by
non-payment that
verified
Other gains/losses satisfy a definition of
3,835,445.51 508,168.93 1,445,926.01
extraordinary gains/losses
Less: Impact on income tax 16,223,813.42 17,317,723.70 12,137,071.11
Impact on minority shareholders’
16,628,761.57 11,554,752.41 12,922,451.75
equity (post-tax)
Total 32,240,557.73 41,166,019.35 32,371,974.32 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss, explain reasons
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□ Applicable √ Not applicable
In reporting period, the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of
extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to
the Public --- Extraordinary Profit/loss
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Section III. Summary of Company Business
I. Main businesses of the company in the reporting period
The Company complies with the disclosure requirement of Information Disclosure Guidelines for the Shenzhen Stock Exchange No.
8- Listing Company Engaged in Retailing Industry
In the reporting period, the main business of Sinopharm Accord includes pharmaceutical distribution and
pharmaceutical retail, specifically as follows:
(i) In the pharmaceutical distribution field, the company continues to integrate the distribution and logistics
business, deeply penetrates into the end markets, improves the stepped distribution network, creates intelligent
supply chain, and devotes to become a provider for pharmaceutical and health care products and services with the
strongest influence, the highest share, the most complete variety, the best service, and the fastest delivery in south
district of China.
1. The Company’s pharmaceutical distribution business is established in Guangdong and Guangxi, the company
has completed the network construction of Guangdong and Guangxi in 2013, and the business has extended to the
county-level regions; in 2014, we accelerating the integration of three-tier companies and the Company achieved
an operation all over the network in 2015. The network further expanded in 2019 and main development direction
is retail terminals. As of 31 December 2020, after optimizing and adjusting the types of customers in 2020, there
are 1,092 second- and third-tier medical institutions, 7,745 primary-level medical customers, and 8,257 retail
terminal customers (chain pharmacies, single stores, and self-paying pharmacies in hospitals).
2. The Company’s pharmaceutical distribution business has achieved the first scale in Guangdong and Guangxi;
The Guangdong and Guangxi regions have subdivided the format markets, pharmaceutical distribution and
apparatus consumables, retail direct sales and retail diagnosis and treatment, medical instrument linkage, retail
development, and the entire industry business maintains a relatively leading position in the industry; innovative
business continues to develop new customer cooperation models and become a medical supply chain management
solution and service providers; improve national logistics planning and construction, provide third-party logistics
professional services, and create leading logistics and supply chain service capabilities.
(ii) In the pharmaceutical retail field, Guoda Drugstore is a leading pharmaceutical retail enterprise in sales scale
throughout the country, and is one of the few enterprises in China with national direct sales drug retail network.
By the end of 2020, Guoda Drugstore has operated 7,660 stores, covering 20 provinces, autonomous regions and
municipalities, entering nearly 142 large and medium sized cities, which has formed a drugstore networks
covering eastern and northern China, southern coastal cities, and gradually expanded into northeast, central plains
and inland cities, the sales scale of which has exceeded 19 billions, ranking the first within industry; Guoda
drugstore, the business of which were mainly relying on modern retail drugstores, has been putting great attention
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on the development of professional service system with medical resources as core competitiveness, building a
group of stores with professional commercial activities, which are able to provide retails and therapy services that
integrating medical service and health-care products sales and cooperate with hospitals; at the same time, the
Company has been vigorously developing new business, exploring and expanding new sales channels, improving
professional services, being dedicated to transit from a traditional medical retail into an innovative service
enterprise. By means of conventional products retail management, improving major brands and exploring business
cooperation with supplier, accelerating the establishment and improvement of DTP business and continuation of
health care service system, Guoda has built industry-leading professional service ability.
II. Major changes in main assets
1. Major changes in main assets
Major assets Note of major changes
Increased 165.3726 million Yuan over that of period-begin with 7.45% rate of change,
Equity assets
mainly because the investment income from joint ventures increased.
Increased 146.1909 million Yuan over that of period-begin with 20.65% rate of change,
Fixed assets mainly because the new enterprise merged in the Period made an increase in balance of
the period-end.
Increased 359.5564 million Yuan over that of period-begin with 95.94% rate of change,
mainly because the sales network, trademarks and brand rights are resulted for the
Intangible assets acquisition of Shanghai Dingqun Enterprise Management Consulting Co., Ltd and
Chengda Fangyuan Pharmaceutical Group Co., Ltd by subsidiary of the Company -
Guoda Drugstore in the Period.
Increased 15.0486 million Yuan over that of period-begin with 47.65% rate of change,
Construction in progress mainly because more investment for the ERP system construction and supply chain
extension project.
Decreased 2887.525 million Yuan over that of period-begin with -32.50% rate of change,
mainly due to the payment for equity acquisition of Chengda Fangyuan Pharmaceutical
Cash and bank balances
Group Co., Ltd and Shanghai Dingqun Enterprise Management Consulting Co., Ltd,
acquired by the subsidiary of the Company- Guoda Drugstore.
Increased 958.6451 million Yuan over that of period-begin with 214.78% rate of change,
Receivable financing mainly because the settlement with customers has changed and the receivable financing
increased at end of the Period by the newly merged enterprise
Increased 1737.3174 million Yuan over that of period-begin with 172.00% rate of
change, mainly due to the acquisition of Chengda Fangyuan Pharmaceutical Group Co.,
Goodwill
Ltd and Shanghai Dingqun Enterprise Management Consulting Co., Ltd, acquired by the
subsidiary of the Company- Guoda Drugstore.
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Increased 29.0079 million Yuan over that of period-begin with 45.96% rate of change,
Deferred tax assets mainly because the new enterprise merged in the Period made an increase in balance of
the period-end.
Increased 330.8426 million Yuan over that of period-begin with 427.69% rate of change,
Other non-current assets mainly due to the emergency special reserve materials purchased at the request of the
government for preventing and controlling the COVID-19.
2. Main overseas assets
□ Applicable √ Not applicable
III. Core competitiveness analysis
1. Strong network coverage and layout
Relying on the perfect distribution network and variety resources, Sinopharm Accord has unified the wholesale
and retail resources. The company has a complete drug distribution network in the whole country and Guangdong
and Guangxi regions, sales of all forms have achieved a steady growth.
(1) The 50 subsidiaries in 23 prefecture-level cities in Guangdong and Guangdong fully cover medical institutions
at all levels, small social medical institutions, and retail chain single-store terminals;
(2) In terms of retail diagnosis and treatment, DTP and hospital-side pharmacies (Sinopharm Holding Drugstore)
exceeded 100;
(3) Logistics construction includes 5 large-scale automated logistics centers in Guangzhou, Shenzhen, Foshan,
Nanning and Liuzhou and 15 regional distribution centers, providing efficient logistics services for national
distribution areas, retail direct sales, medical direct sales, and third-party logistics.
Sinopharm Accord has a retail network leading in scale and covering the whole country, Guoda Drugstore has
retail chain network spreading over 20 provinces, municipalities and autonomous regions, covering nearly 142
cities nationwide.
2. Abundant variety resources
After years of hard work, the company’s distribution business has accumulated rich variety resources in
pharmaceuticals, consumables and other fields, and established extensive cooperative relations with thousands of
domestic manufacturers and commercial enterprises, and established stable business relationships with hundreds
of import and joint ventures, the overall operating product regulations exceed 50,000.
Guoda Drugstore operates nearly 120,000 merchandises. With its relatively comprehensive purchasing network and
years of experience in commodity management, Guoda Drug Store has established a merchandise system with wide
coverage, high professionalization, and rich varieties.
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3. Complete logistics and distribution system
Sinopharm Accord distribution adopts supply chain management and warehouse management solutions system, it
has built large-scale first-grade logistics centers in Guangzhou, Nanning, Shenzhen and other places and
established distribution centers in Guangdong and Guangxi which has formed ladder logistics and distribution
networks, it is the first enterprise in Guangdong and Guangxi that has achieved the third-party logistics
qualification and has the professional pharmaceutical logistics capabilities with the largest scale, the most
extensive network, and the most complete modes in south district of China.
Guoda Drugstore owns a nationwide modern logistics and distribution system, and the logistics warehouses are
located in 20 provinces, has 33 large-and-small logistics warehouses, covering an area of about 160,000 square
meters in total.
4. The advantages of medical insurance resources
Regarding medicine retails, the subsidiaries of Guoda Drugstore have featured generally higher medical insurance
acquiring ability, with higher medical insurance sales ratio and steady operation.
5. The advantages of Compliance
The Company had a big lead under an increasingly stringent regulatory environment for the reason that it has kept
emphasizing legalization and compliance in the process of operation and management.
6. Unique-influence Sinopharm brand
Brand of the Company and distribution, industry child-brand and controlling shareholder and actual controller’s
brand come down in one continuous line, depending on powerful force of central enterprises, the Company’s
popularity and influence are prominent day by day in the industry.
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Section IV. Discussion and Analysis of Business
1. Introduction
In 2020, the COVID-19 epidemic swept across the world, plus the impact of policies such as centralized drug
procurement, the growth rate of the industry sharply declined, and the industry structure continued to restructure,
Sinopharm Accord took various measures to ensure growth under the pressure. During the epidemic, Sinopharm
Accord undertook the central, provincial (Guangdong, Guangxi), municipal (Guangzhou, Shenzhen, Nanning, etc.)
special reserves of medical instrument commodities and the allocation and supply of epidemic prevention and
anti-epidemic materials needed throughout the country. Facing the complicated policy and market environment,
under the strategic guidance of SINOPHARM and Sinopharm Holding, Sinopharm Accord coordinated epidemic
prevention and control and business development, improved quality and efficiency and sprinted goals with the
determination of "undiminished tasks and unchanged goals", solidly advanced all the work, excellently completed
the major task of fighting the epidemic and guaranteeing the supply, while effectively responding to the huge
impact of the epidemic, and achieved new highs in operating performance.
In 2020, the Company has accumulated operating income of 59,649 million yuan, a y-o-y growth of 13.00%;
operating profit achieved 2,164 million yuan with 18.21% up on a y-o-y basis; the net profit amounted as 1,721
million yuan, a y-o-y increase of 16.29% and the net profit attributable to shareholders of listed company was
1402 million yuan, an increase of 10.57% from a year earlier.
In 2020, Sinopharm Accord achieved a total operating income of 41070 million yuan in distribution business, a
y-o-y increase of 2.64%. Through overcoming the impact of epidemic on medical institutions, the advantages of
direct-selling business have been consolidated. At the same time, the coverage of primary medical institutions has
been further improved in breadth and depth, and a number of business types have a rapidly growth, of which: the
hospital recovered its direct sales to the original scale with 3% down slightly, direct sales of other medical
institutions increased by 5% on a y-o-y basis, retail direct-sale has 16% up on a y-o-y basis, device consumables
business growth on a y-o-y basis of 42% and 27% increase from retail clinic on a y-o-y basis. Sinopharm Accord
achieved a net profit of 855 million yuan in distribution business in 2020, a y-o-y increase of 1.06%.
In 2020,Guoda Drugstore completed an operating income of 19438 million yuan in total, a y-o-y growth of
44.04%. Various types of business have developed rapidly, including 44% up on a y-o-y basis from dire-sale
routine, 22% growth from DTP, 221% growth from OTO and 18% rate of growth from franchise business. Guoda
Drugstore achieved a net profit of 477 million yuan in 2020 with a growth of 54.81% from a year earlier,the net
profit attributable to parent company amounted as 341 million yuan, a y-o-y increase of 41.82%.
In 2020, the accumulative investment income from associates was 354 million yuan, a y-o-y increase of 7.00%.
15
(I) Working together to fight the epidemic
Sinopharm Accord fulfilled its responsibility for epidemic prevention and supply, and gave full play to its network
advantages and global channel procurement capabilities, companies at all levels have been recognized by all
sectors of society in terms of medical material distribution, material reserves, resumption of production and work,
and organizational effectiveness and anti-epidemic actions have been commended by governments at all levels, 22
subsidiaries have obtained qualifications for emergency medical supplies reserves with 46 qualifications. Guoda
Drugstore won the title of Outstanding Contribution Enterprise in "Fighting COVID-19 Epidemic" of Shanghai;
Sinopharm Holding Guangzhou won the honorary titles of Guangdong Province's Advanced Group in Fighting
COVID-19 Epidemic and Guangdong Province's Advanced Grassroots Party Organization in Fighting COVID-19
Epidemic.
1. Sinopharm Accord’s distribution business segment undertook the medical supplies emergency guarantee supply
and material assistance tasks on a large scale
At the beginning of 2020, the epidemic was raging. Sinopharm Accord’s distribution business segment quickly
established emergency leading groups and supply guarantee groups at all levels, established working mechanisms,
formulated emergency plans, overcame shortages of supply and transportation control and other issues, and
completed the sourcing, procurement, storage, and delivery of emergency supplies in a timely manner, the total
purchasing and storage amounted to more than 1.59 billion yuan; more than 2,000 objects were allocated, more
than 142 large-scale equipment such as breathing machines and ECMO were deployed, more than 1.76 million
sets of protective clothing, isolation clothing were deployed, and more than 8.48 million gloves and more than
96.8 million masks of various types were deployed.
2. Guoda Drugstore assumed full social responsibility and provided epidemic material support services
Guoda Drugstore took advantage of the national centralized procurement, coordinated inventory allocation,
actively sought sources to purchase epidemic prevention materials, and ensured government rationing and market
supply through multi-sectoral coordination. During the epidemic, the company's 24 regional companies and more
than 5,000 directly-operated stores were operating normally, and 21 subsidiaries undertook the government's
fixed-point distribution tasks of epidemic materials; provided anti-epidemic materials, including 320 million
masks, more than 8.76 million bottles of disinfection supplies, and more than 23 million pieces of protective
articles such as protective clothing and gloves.
(II) Sinopharm Accord's distribution business segment: firmly promote the overall deployment of one body with
two wings strategy, improve quality and efficiency, and accelerate the upgrade of the supply chain
1. Continue to increase the market share of traditional businesses: direct sales by hospitals were 29 billion yuan, a
decrease of 3% on a year-on-year basis, and direct sales by other medical institutions were 3.6 billion, an increase
of 5% on a year-on-year basis.
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Among the 35 cities in Guangdong and Guangxi, the regions with top three market shares increased by 4 on a
year-on-year basis. All subsidiaries in Guangdong and Guangxi have obtained a higher proportion of distribution
rights in the national centralized procurement, and the entrusted delivery rate of various batches of centralized
procurement have been staying ahead of the industry. The company actively grasped the market concentration
opportunities brought by the GPO platform, followed up GPO landing areas in many regions in Guangdong, and
increased the market share of the provincial platform and the Guangzhou platform. At the same time, continued to
carry out the "ice-breaking" operation of the original third-party trustee medical institutions, competed for the
cultivation of new varieties, carried out special management of ice-breaking areas, and expanded advantages.
2. Retail direct sales business: In 2020, retail direct sales (including small-scale social medical services) had a
total sales of 6,877 million, a year-on-year increase of 16%.
Sinopharm Accord's distribution business segment accelerated the network layout of retail terminals, continued to
promote the top 100 national chain projects, promoted the national retail integrated terminal projects, and
developed 4,533 new customers. Developed a network of member stores, and achieved sales of 31.51 million
yuan in member stores, and built a network of hospital-side stores in Guangdong Province, covering a total of 456
stores. Leveraged the advantages of the B2B e-commerce platform, the cumulative customer online rate reached
94%, and the online order rate reached 76%, and sales exceeded 2,200 million. Further improved the platform
functions, realized the upgrade of online payment, membership management and other functions, optimized and
upgraded more than 100 basic functions, and developed a standard assessment system for platform operation and
maintenance. At the same time, science and technology empowered terminal marketing model innovation,
promoted the launch of the official account of Sinopharm Holding Hengxing Member Store and Sinopharm
Daojia WeChat Mall, established Sinopharm Holding Hengxing live broadcast room, and independently launched
an online live broadcast model.
3. Retail diagnosis and treatment: cumulative sales was 1,710 million yuan, a year-on-year increase of 27%
Sinopharm Accord's distribution business segment completed the first phase of the comprehensive network layout
of the Guangdong and Guangxi specialty pharmacies. At the end of the reporting period, the total number of large
pharmacies of Sinopharm Holding reached 100 (75 in Guangdong and 25 in Guangxi), an increase of 17
compared with the beginning of the year, and completed the layout of 4 key hospitals. Actively promoted the
circulation of prescriptions, established cooperative relationships with over 10 platforms, and initiated 31
prescription circulation projects (17 new projects), involving 55,000 prescriptions. Combined and promoted
medical insurance and commercial insurance projects, two subordinate large pharmacies have passed the national
special drug pharmacy certification. At the same time, the large pharmacies in Shenzhen and Maoming have
obtained the overall medical insurance network settlement qualification, and the three large pharmacies in Zhuhai
have access to the country’s first prefecture-level medical insurance prescription circulation platform - "Zhuhai
City Cloud Medical Insurance Prescription Sharing Service Platform", a total of 19 large pharmacies have
17
obtained the first batch of prefecture-level commercial supplementary medical insurance designated pharmacies
qualifications. Explored a multi-level service model, promoted the implementation of a multi-level payment
service model of "Mentor Services + Commercial Supplementary Medical Insurance Services + Rare Disease
Assistance Services + Commercial Health Insurance Services + Charity Assistance", promoted professional
patient services, and established a patient medication follow-up model, a total of more than 8,000 people were
followed up throughout the year; the model of live broadcast of patient education was innovated, with 22 live
broadcast of patient education throughout the year.
4. Accelerate the development of innovative business characteristics and promote the transformation and
upgrading of business models
(1) Promote the rapid expansion of innovative business to subsidiaries: During the reporting period, the
cumulative sales of equipment and consumables were 5,530 million yuan, a year-on-year increase of 42%; the
cumulative service fee income of innovative business increased by 36% on a year-on-year basis.
(2) Promote the differentiated development of 4D business:
1) SPD: Create a model project through standardized process management: The Third People’s Hospital of
Shenzhen project has realized the centralized management of material information through the combination of
SPD+IVD; Dongguan Eighth People's Hospital project is the first professional SPD project outside of Guangzhou
and Shenzhen
2) CSSD: Undertake the Conghua Hospital project-the first regional disinfection business led by the government.
3) Innovative IVD+cold chain combined service model: Undertake the Fengshun People’s Hospital project
4) MED: The Third Affiliated Hospital of Southern Medical University project has obtained the qualification of
the first Philips authorized dealer in Guangdong and Guangxi.
(3) Expand the third-party logistics business of disease control warehousing and distribution
Created a third-party integrated supply chain service system for vaccines, realized the docking with the
immunization planning system of the Guangdong and Guangxi CDC; completed the delivery business of
vaccination points in Guangzhou, Shenzhen, Foshan and other places.
5. Industry and finance dual drive, continue to deepen the distribution network layout
By reorganizing the 70% equity of Yangjiang Hecheng, Sinopharm Holding Guangzhou has filled the gap in the
Yangjiang regional market and increased the company's local market share. At the same time, diversified the
layout around the supply chain, speeded up the target selection and mergers and acquisitions of innovative
projects.
(III) Guoda Drugstore business: Seize the opportunity, make breakthroughs in mergers and acquisitions, and grow
rapidly throughout the year
1. Promote store expansion and strengthen regional advantages
18
As of the end of 2020, the total number of Guoda Drugstore reached 7,660 stores (including 6,212 directly
operated stores, and 1,448 franchised stores), an increase of 2,639 from the beginning of the year. Guoda
Drugstore has covered 20 provinces/municipalities and 88 prefecture-level cities across the country. In 2020, it has
expanded to 25 prefecture-level cities and 59 county-level administrative district cities. At the same time, each
region has seized the opportunity of layout to promote store expansion, expand secondary and tertiary hospital
side stores, strive for medical insurance co-ordination qualifications, and undertake prescription outflows; and it
also has expanded community advantageous areas to provide community consumers with convenient health
services.
2. Focus on the whole nationwide network strategy for retail, comprehensively promote investment and mergers
and acquisitions
Further increase market share and concentration through investment mergers and acquisitions, in 2020, Guoda
Drugstore successfully and merged and acquired Cheng Da Fang Yuan, a leading regional chain, the project
stretched across 5 provinces and 19 cities, adding more than 1,500 stores. This acquisition has consolidated the
company’s position as a leading company in the national sales scale in the pharmaceutical retail sector, and
consolidated the leading position in the advantageous regions, especially the Liaoning region.
3. Vigorously promote the construction of its own brand
In 2020, its own brand sales increased by 43% on a year-on-year basis, and gross profit increased by 30% on a
year-on-year basis. The company speeded up the development of its own brand varieties, and cooperated with the
global sourcing center of Sinopharm Holding to jointly develop OEM varieties and multi-channel sales, and
cooperated with Sinopharm Medical Device, Shenzhen Zhijun, Sinopharm Aomei, China TCM, Xiamen Xingsha
to complete the planning for nutrient and home protection key points category, and has completed the
development of mid-to-high-end series of nutrient-owned brands. At the same time, established a quality control
system, improved the management of its own brand, formulated a special sales incentive mechanism, and carried
out brand promotion.
4. Enhance professional service capabilities for chronic diseases and continue to build a professional service
system for pharmaceutical affairs
(1) Strengthen professional training and promote personnel training. Guoda Drugstore has 2,149 chronic disease
specialists and diabetes specialists, and 2,117 hypertension specialists. By organizing employees to actively
participate in the examination of licensed pharmacists, and carrying out E-learning pharmacy service training,
epidemic training, manufacturer resource training, etc., and organizing "Master of Glory" training and "Master of
Actual Combat" high hyperlipaemia training to promote the training of professional talents.
(2) Strengthen chronic disease management and improve service quality. The number of effective members of
Guoda Drugstore increased by 52% on a year-on-year basis, and member sales increased by 67% on a
year-on-year basis. Carry out online patient education and complete relevant training on respiratory system,
COPD, bronchial system, etc.; establish a doctor-patient circle in the healthy communities to promote
19
communication among patients, shop assistants, doctors, and manufacturers; carry out hospital-store linkages,
skill competitions, patient education, store free clinics, chronic disease through-train projects and other activities;
carry out monthly store service inspections, evaluate the basic service level of stores, and strengthen store services
through the evaluation mechanism.
5. Focus on the development of internet business, promote the integration of online and offline, innovative
businesses (including B2C, third-party O2O, self-operated O2O, commercial insurance) reached 1,140 million
yuan in tax-included sales, a year-on-year increase of 96%.
(1) Development of self-operated e-commerce platform
The subordinate 22 subsidiaries of Guoda Drugstore have launched self-operated malls with nearly 3.83 million
members; the importance of the platform during the epidemic has become prominent, providing convenience for
consumers to purchase drugs without contact, and gradually cultivating consumers' internet drug purchasing habits;
promoted platform function optimization, including the development of pre-sale, variety library standard products,
brand pavilion and other functions; triggered from Weizi and arabinose varieties, and focused on social marketing.
(2) Third-party O2O platform construction
There are more than 6000 online stores on various third-party platforms, and the third-party O2O business has
increased from 12,000 orders/day at the beginning of the year to 40,000 orders/day, and the market share of core
cities has continued to increase. We cooperated with key suppliers to create traffic landing, and used differentiated
management of core stores to create a win-win situation.
(3) Vigorously develop self-media marketing
Live broadcast marketing was carried out through WeChat video accounts and short video accounts, and 205 live
broadcasts were completed throughout the year, with a total of over 18 million viewers and more than 180,000
fans.
(4) Expand multi-party commercial insurance business
Pay attention to the use of drugs for people with serious illnesses, and achieved sales of 131 million yuan through
cooperation with serious illness commercial insurance. Cooperate with key commercial insurance channels to
increase offline marketing activities and service duration expansion.
(IV) Continue to promote the core strategy of integration of wholesale and retail, and expand the pilot area of
integration of wholesale and retail
Taking into account the regional coverage, sales scale, and distribution of the corresponding regional distribution
companies of the subsidiaries of Guoda Drugstore, 10 regions including Shanxi and Inner Mongolia were selected,
and a total of 15 regions were promoted and implemented in the integrated model of wholesale and retail. For the
10 newly-added pilot regions, we conducted regional meetings to announce the experience summary of wholesale
and retail integration, successful cases and annual plans, and guided the direction of work in the pilot regions.
Among them, in 2020, Guangdong's integrated wholesale and retail sales reached nearly one billion yuan, a
20
year-on-year increase of more than 18%; wholesale and retail integration covered 1,032 member stores in
Guangdong, a net increase of 722 stores from the beginning of the year.
(V) Comprehensively promote digital transformation to help upgrade the supply chain
Sinopharm Accord has established a digital transformation project team, determined the blueprint and path of
digital transformation, and coordinated project implementation; established an information technology center to
simulate "corporate" operations to fully support the digital transformation of the company's business. Taking
digital transformation as an important starting point, we have explored the key points of improvement from all
links of the supply chain, and comprehensively promoted the improvement of supply chain operation efficiency
from the aspects of sales automation, quality management integration, operation digitalization, logistics
digitalization, and financial digitalization.
(VI) Improve quality and efficiency, and promote high-quality development of the company
We combined the improvement of personnel efficiency, the control of the two funds, the governance of
loss-making companies, the management of risk and other quality and efficiency improvement projects, the
company's profitability has been improved from the potential of expenses, business growth, etc., and the
company's overall operating profit rate and profitability have achieved year-on-year growth and promotion. We
also have promoted the optimization of the organizational structure, scientifically designed the department
structure and staffing, promoted the improvement of human efficiency, capacity cultivation, etc., and enhanced the
organization's ability to quickly adapt to the environment; established a dynamic risk management and control
system, promoted the long-term management and control of the two funds pressure control, strictly grasped the
special governance of the enterprise, and improved the quality and efficiency to ensure development.
The Company complies with the disclosure requirement of Information Disclosure Guidelines for the Shenzhen Stock Exchange No.
8- Listing Company Engaged in Retailing Industry
Operation of the retail stores in reporting period:
1. By the end of 2020, Guoda Drugstore has 6,212 direct-sale stores, sales revenue (tax excluded) amounted to
14.136 billion yuan; and has 1,448 franchised stores, the distribution revenue (tax excluded) amounted as 1.329
billion yuan.
Region Direct-sale store Franchised outlet
Sales revenue (in 10 thousand Distribution revenue (in 10
Numbers Numbers
Yuan) thousand Yuan)
North 4,068 832,218.40 544 55,207.08
East China 959 262,019.24 599 61,059.48
21
South China 476 157,197.28 168 10,023.56
Central China 298 61,630.36 137 6,579.59
Northwest 295 81,916.87
Southwest 116 18,663.34
Total 6,212 1,413,645 1,448 132,869.71
Note: North: Liaoning, Shanxi, Inner Mongolia, Beijing, Tianjin, Hebei, Jiling;
East China: Shanghai, Jiangsu, Anhui, Shandong, Fujian, Zhejiang;
South China: Guangdong, Guangxi;
Central China: Henan, Hunan;
Northwest: Ningxia, Xinjiang;
Southwest: Yunnan
(1) There were 759 new stores opened and 240 closed in 2020, a net increase of 519stores.
Region Direct-sale store Franchised outlet
Number of
Number of store Number of store Number of stores shut
Total area (square meters) stores shut
increased increased down
down
North 499 56,442.72 -105 103 -135
East China 105 12,705.46 -77 46 -39
South China 60 6,322.40 -29 62 -17
Central China 34 3,422.86 -21 22 -1
Northwest 41 4,924.31 -6 - -
Southwest 20 2,244.37 -2 - -
Total 759 86,062.12 -240 233 -192
(2) Medical insurance qualification of the stores
As of 31 December 2020, the Company has 6212 chain stores with directly selling, and 5490 pharmacy stores
obtained the qualification of “Designated retail pharmacies of medical insurance”, representing 88% of the total
pharmacies of the Company.
Stores obtained the qualification of
Region Number of stores Ratio in total pharmacies in
“Designated retail pharmacies of medical
22
insurance” regions
North 4068 3738 92%
East China 959 729 76%
South China 476 400 84%
Central China 298 246 83%
Northwest 295 267 91%
Southwest 116 110 95%
Total 6212 5490 88%
2.Change of main selling index
Proportion of medical Proportion of
Per customer Proportion of Proportion of the
Year insurance sales in transaction times of
transaction (RMB) prescription drugs direct member sales
direct-sale stores direct members
2019 86 53% 38% 67% 57%
2020 90 52% 41% 67% 59%
(1) Classify according to region
Amount of sales growth (tax-free, in 10 thousand
Region Gross margin Net profit ratio
yuan)
North 497,037 23% 3%
East China 101,582 22% 2%
South China 16,565 25% 2%
Central China 11,259 26% 2%
Northwest 25,223 24% 3%
Southwest 17,212 42% 10%
(2) Operating efficiency of direct-sale stores in reporting period
23
Daily average efficiency
Operating area of the stores Rental efficiency (tax-included,
Region Number of stores (tax-included, Yuan/Square
(square meters) annual sales volume/rental)
Meters)
North 4068 585,036 67 17
East China 959 120,852 66 16
South China 476 53,073 91 19
Central China 298 35,211 53 15
Northwest 295 35,409 72 26
Southwest 116 14,908 39 20
Note: Daily average efficiency=Average daily operating income/Operating area of the stores;
Average daily operating revenue=Operating revenue (tax-included) of the store in the Year/Operating days of store in the Year.
Rental efficiency=Annual sales volume/Yearly rental
3.Structure of the category at retail terminal
Category 2020 2019
Health care products 5.03% 5.54%
Convenience food 0.84% 0.82%
Rx Drug 52.11% 53.00%
OTC 25.83% 25.97%
Traditional Chinese medicine 1.25% 1.07%
Personal care 0.34% 0.21%
Home convenience 7.33% 4.37%
Household health products 4.29% 4.44%
Proportion of other categories 3.00% 4.59%
4. Purchasing and supplies:
Goods suppliers of Guoda Drugstore are mainly external suppliers and assist affiliated enterprise of
SINOPHARM and private brands. Top five suppliers for year of 2020:
Ranking Purchase amount (tax included) (10 thousand yuan) Procurement ratio
No.1 187,639,598 13%
No.2 108,147,621 7%
24
No.3 90,784,195 6%
No.4 84,464,531 6%
No.5 81,079,083 6%
5. Member management and service business
In 2020, the membership sales accounted for 67% with no change in the shares from 2019. At the same time,
the number of member transactions in 2020 has increased by 12% on a year-on-year basis. The proportion of
member transactions in total transactions increased from 56% in 2018 to 57% in 2019, and then to 59% in 2020.
The number of member transactions has maintained a steady annual growth during the continuous improvement
of sales in the past three years, which played a key supporting role in the steady improvement of the company's
performance.
The company has improved its operating efficiency by optimizing the product structure. In 2020, the unit price of
company members was 112 yuan, which was 1.2 times higher than that of non-member customers of 90 yuan. The
main difference between members and non-members lies in the degree of brand recognition and the differentiation
of the types of goods purchased.
6. Warehousing and logistics during the reporting period
As of 2020, the company has a total of 33 logistics distribution centers across the country, with a total logistics
construction area of over 160,000 square meters, which are used for storage and circulation of normal temperature,
shady and cool, and refrigerated products, ensured the distribution of goods for 6,212 directly-operated chain
stores. On average, there are more than 255,000 lines of operations per day, 53,000 customer boxes, the shipment
amount reaches more than 58 million yuan, the company's overall logistics annual distribution exceeds 8.16
million boxes. All logistics operations are paperless and visualized operations, with mechanization as the main
and auxiliary operation. During the reporting period, in response to the storage and transportation temperature
problems of refrigerated drugs, the Quality Center built a cold chain monitoring platform through its own research
+ supplier cooperation, integrated company business data and equipment temperature record data, and realized
real-time monitoring on PC and mobile terminals, used cold chain data as the main monitoring indicators to
realize multi-dimensional dynamic monitoring of cold chain operation, and at the same time formulated and
improved cold chain operation management documents to realize cold chain operation standardization. It solved
the technical problems of heat preservation, temperature measurement and traceability during the storage and
transportation of refrigerated medicines. In 2020, the logistics center has integrated warehousing resources, aimed
at operation standardization, model diversification, moderation automation, and precise energy saving so as to
improve the distribution capacity and utilization rate.
25
II. Main business analysis
1. Overview
Found more in “I. Introduction” in “Discussion and Analysis of Business”
2. Revenue and cost
(1) Constitute of operation revenue
In RMB
2020 2019
Increase/decrease
Ratio in operation Ratio in operation
Amount Amount y-o-y
revenue revenue
Total of operating
59,649,455,012.03 100% 52,786,807,476.28 100% 13.00%
revenue
According to industries
Pharmaceutical
41,771,721,959.60 70.03% 39,289,565,512.68 74.43% 6.32%
distribution
Retail pharmacy 17,626,007,757.96 29.55% 13,327,372,258.48 25.25% 32.25%
Other 251,725,294.47 0.42% 169,869,705.12 0.32% 48.19%
According to products
Pharmaceuticals 54,004,558,520.07 90.54% 48,911,083,932.45 92.66% 10.41%
Medical devices and
4,010,735,060.66 6.72% 2,756,591,633.83 5.22% 45.50%
disposables
Diagnostic reagents 947,638,322.63 1.59% 692,370,435.53 1.31% 36.87%
Medical equipment 434,797,814.20 0.73% 256,891,769.35 0.49% 69.25%
Other 251,725,294.47 0.42% 169,869,705.12 0.32% 48.19%
According to region
China 59,649,455,012.03 100.00% 52,786,807,476.28 100.00% 13.00%
(2) About the industries, products, or regions accounting for over 10% of the company’s operating income
or operating profit
√Applicable □ Not applicable
In RMB
Increase/decrease Increase/decrease Increase/decrease
Gross profit
Operating revenue Operating cost of operating of operating cost of gross profit
ratio
revenue y-o-y y-o-y ratio y-o-y
26
According to industries
Pharmaceutical
41,771,721,959.60 39,206,149,975.93 6.14% 6.32% 6.48% -0.15%
distribution
Retail pharmacy 17,626,007,757.96 13,265,264,981.82 24.74% 32.25% 32.33% -0.04%
According to products
Pharmaceuticals 54,004,558,520.07 47,415,791,473.79 12.20% 10.41% 9.19% 0.98%
According to region
China 59,649,455,012.03 52,591,767,464.37 11.83% 13.00% 12.16% 0.66%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main business based on
latest one year’s scope of period-end
□Applicable √Not applicable
(3) Income from physical sales larger than income from labors
√Yes □No
(4) Fulfillment of the company’s signed significant sales contracts up to this reporting period
□Applicable √Not applicable
(5) Constitute of operation cost
In RMB
2020 2019
Increase/decrease
Industries Item Ratio in Ratio in
Amount Amount y-o-y
operation cost operation cost
Pharmaceutical
Sales cost 39,206,149,975.93 74.55% 36,819,319,475.22 78.52% 6.48%
distribution
Retail pharmacy Sales cost 13,265,264,981.82 25.22% 10,024,600,201.08 21.38% 32.33%
Other Other cost 120,352,506.62 0.23% 47,304,628.74 0.10% 154.42%
Note
N/A
(6) Whether the changes in the scope of consolidation in Reporting Period
√Yes □ No
Details of the changes in the scope of consolidation in reporting Period can be seen in Note VI of Financial Report.
27
(7) Major changes or adjustment in business, product or service of the Company in Reporting Period
□ Applicable √ Not applicable
(8) Major sales and main suppliers
Major sales client of the Company
Total top five clients in sales (RMB) 2,567,346,434.44
Proportion in total annual sales volume for top five clients 4.30%
Ratio of related parties in annual total sales among the top
0.00%
five clients
Information of top five clients of the Company
Serial Name Sales amount (RMB) Proportion in total annual sales
1 No. 1 728,589,391.96 1.22%
2 No. 2 531,588,556.80 0.89%
3 No. 3 465,948,001.18 0.78%
4 No. 4 423,815,969.50 0.71%
5 No. 5 417,404,515.00 0.70%
Total -- 2,567,346,434.44 4.30%
Other situation of main clients
□ Applicable √ Not applicable
Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 7,418,642,753.58
Proportion in total annual purchase amount for top five
12.26%
suppliers
Ratio of related parties in annual total sales among the top
1.68%
five suppliers
Information of top five suppliers of the Company
Serial Suppliers Purchase amount (RMB) Proportion in total annual purchases
1 No. 1 4,307,618,451.80 7.12%
2 No. 2 1,016,554,697.18 1.68%
3 No. 3 948,648,459.33 1.57%
4 No. 4 593,899,138.58 0.98%
5 No. 5 551,922,006.69 0.91%
Total -- 7,418,642,753.58 12.26%
28
Other notes of main suppliers of the Company
□ Applicable √ Not applicable
3. Expenses
In RMB
Increase/decrease
2020 2019 Note of major changes
y-o-y
Sales expense 3,943,134,095.75 3,168,007,835.69 24.47% No major changes occurred
Management expense 1,008,178,815.78 871,076,467.62 15.74% No major changes occurred
Financial expense 119,855,169.85 126,340,266.54 -5.13% No major changes occurred
4. R&D expenses
□ Applicable √ Not applicable
5. Cash flow
In RMB
Item 2020 2019 Increase/decrease y-o-y
Total cash inflows from operating
63,412,452,004.15 57,406,241,648.15 10.46%
activities
Total cash outflows from operating
61,909,705,405.68 55,393,588,458.41 11.76%
activities
Net cash flows from operating activities 1,502,746,598.47 2,012,653,189.74 -25.34%
Total cash inflows from investing
211,813,981.71 639,931,575.04 -66.90%
activities
Total cash outflows from investing
2,995,043,135.68 861,056,729.45 247.83%
activities
Net cash flows from investing activities -2,783,229,153.97 -221,125,154.41 -1,158.67%
Total cash inflows from financing
1,166,552,513.20 467,185,917.92 149.70%
activities
Total cash outflows from financing
2,906,975,331.01 1,467,403,127.13 98.10%
activities
Net cash flows from financing activities -1,740,422,817.81 -1,000,217,209.21 74.00%
Net decrease/ increase in cash and cash
-3,020,957,912.17 791,135,132.86 -481.85%
equivalent
Main reasons for y-o-y major changes in aspect of relevant data
√Applicable □ Not applicable
29
(1) Total cash inflows from investing activities: has 66.90% down from a year earlier, mainly because in the
period, subsidiary of the Company- Guoda Drugstore merged the Shanghai Pudong New Area Medicine &
Medication Co., Ltd. under the same control; and at same period last year, received the appropriation from the
cash pool of Sinopharm Group, the original parent company of Pudong Medicine in the previous year, and
recovered the funds originally collected to the cash pool in the current year;
(2) Total cash outflows from investing activities: has 247.83% up from a year earlier, mainly due to the payment
for equity acquisition of Chengda Fangyuan Pharmaceutical Group Co., Ltd and Shanghai Dingqun Enterprise
Management Consulting Co., Ltd in the Period by subsidiary of the Company - Guoda Drugstore;
(3) Net cash flows from investing activities: has 1,158.67% down from a year earlier, mainly due to the payment
for equity acquisition of Chengda Fangyuan Pharmaceutical Group Co., Ltd and Shanghai Dingqun Enterprise
Management Consulting Co., Ltd in the Period f by subsidiary of the Company - Guoda Drugstore;
(4) Total cash inflows from financing activities: has 149.70% up from a year earlier, mainly because received a
loans from financial institution in the period, and received the special loans for COVID-19 epidemic prevention
and control;
(5) Total cash outflows from financing activities: has 98.10% up from a year earlier, mainly because repayment of
the borrowings to non-financial institutions and repayment of supply chain financing increased;
(6) Net cash flows from financing activities: has 74.00% up from a year earlier, mainly because repayment of the
borrowings to non-financial institutions and repayment of supply chain financing increased;
(7) Net decrease/ increase in cash and cash equivalent: has 481.85% down from a year earlier, mainly due to the
payment for equity acquisition of Chengda Fangyuan Pharmaceutical Group Co., Ltd and Shanghai Dingqun
Enterprise Management Consulting Co., Ltd in the Period by subsidiary of the Company - Guoda Drugstore
Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
□Applicable √Not applicable
III. Analysis of the non-main business
□ Applicable √ Not applicable
IV. Analysis of assets and liabilities
1. Major changes of assets composition
The Company initially implemented the new revenue standard or new lease standards since 2020, and relevant items of the financial
statement at year-beginning of the implementation year were adjusted
Not applicable
In RMB
Year-end of 2020 Year-end of 2019 Ratio
Notes of major changes
Amount Ratio in Amount Ratio in changes
30
total assets total assets (+,-)
Mainly due to the payment for
equity acquisition of Chengda
Fangyuan Pharmaceutical Group
Cash and bank Co., Ltd and Shanghai Dingqun
5,998,204,295.87 15.15% 8,885,729,250.47 26.11% -10.96%
balances Enterprise Management
Consulting Co., Ltd in the Period
by subsidiary of the Company -
Guoda Drugstore
Accounts
13,799,971,014.22 34.85% 10,712,983,544.18 31.48% 3.37% No major changes occurred
receivable
Inventories 6,285,010,674.46 15.87% 5,063,274,143.26 14.88% 0.99% No major changes occurred
Investment
properties
127,444,379.94 0.32% 138,900,358.30 0.41% -0.09% No major changes occurred
Long-term equity
2,287,019,627.99 5.78% 2,105,114,410.88 6.19% -0.41% No major changes occurred
investment
Fix assets 854,191,083.27 2.16% 708,000,172.63 2.08% 0.08% No major changes occurred
Construction in
46,631,190.23 0.12% 31,582,575.84 0.09% 0.03% No major changes occurred
progress
Short-term
1,612,187,020.12 4.07% 1,453,018,300.01 4.27% -0.20% No major changes occurred
borrowings
Received the loans from Group
Long-term Finance Company entrusted by
borrowings
31,637,173.89 0.08% - - 0.08%
China National Pharmaceutical
Group Corporation in the Period
2. Assets and liability measured by fair value
√Applicable □ Not applicable
(1) Assets and liabilities at fair value
2020
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
Continuous measurement of
fair value
Receivables financing - 1,404,987,700.38 - 1,404,987,700.38
Other investment in equity - -
31
instruments 99,488,340.28 99,488,340.28
Other non-current financial
assets - - 120,972,350.24 120,972,350.24
- 1,504,476,040.66 120,972,350.24 1,625,448,390.90
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
Continuous measurement of
fair value
Receivables financing - 446,342,588.46 - 446,342,588.46
Other investment in equity
instruments - 116,021,000.00 - 116,021,000.00
Other non-current financial
assets - - 140,000,000.00 140,000,000.00
- 562,363,588.46 140,000,000.00 702,363,588.46
(2) Assets and liabilities disclosed at fair value
2020
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 - 31,637,173.89 - 31,637,173.89
Whether the measurement attribute for main assets of the Company have changed significantly in the reporting period
□Yes √No
32
3. Assets right restriction till end of reporting period
2020 2019 Note
Cash and cash equivalents 593,091,037.88 442,672,297.43 (1)
Notes receivable and accounts
receivables financing that were
endorsed 27,939,151.58 - (2)
Notes receivable that were
discounted - 64,038,348.12 (3)
Receivables financing that were
pledged 2,620,000.00 - (4)
623,650,189.46 506,710,645.55
(1) On 31 December 2020, the Group had deposits of bank acceptance bills, deposits for letters of credit,
and fixed deposits for guarantee or notice deposits of RMB593,091,037.88 (31 December 2019:
RMB442,672,297.43) (found more in the Note V-1 carried in Section XII Financial Report).
(2) On 31 December 2020, the Group had accounts receivables financing of RMB23,843,867.66 and
commercial acceptance bills receivable of RMB4,095,283.92, which were endorsed but not have
matured (31 December 2019: nil) (found more in the Note V-2 and Note V-4 carried in Section XII
Financial Report).
(3) On 31 December 2020, the Group had commercial acceptance bills receivable of RMB0.00, which
were discounted but have not matured (31 December 2019: RMB64,038,348.12) (found more in the
Note V-2 carried in Section XII Financial Report).
(4) On 31 December 2020, the Group had pledged financing receivable of RMB2,620,000.00 (31
December 2019: nil) (found more in the Note V-4 carried in Section XII Financial Report).
V. Investment
1. Overall situation
√ Applicable □ Not applicable
(1) During the reporting period, the Company acquired the four enterprises in cash with combined under the
different control, including Chengda Fangyuan Pharmaceutical Group Co., Ltd (100%), Shanghai Dingqun
Enterprise Management Consulting Co., Ltd (100%), Beijing Golden Elephant Guoxing Pharmaceutical Co., Ltd.
(100%) and Sinopharm Accord (Yangjiang) pharmaceutical Co., Ltd.（70%） the Company acquired the Shanghai
Pudong New Area Medicine & Medication Co., Ltd. (75%) in cash for the enterprise merged under the same
control. The company newly established subsidiaries including Guoda Pharmacy (Rizhao) Co., Ltd. (100%),
Liaoning Guoda Health Pharmacy Co., Ltd. (100%), Liaoning Guoda Pharmacy Co., Ltd. (100%), Liaoning
Huludao Guoda Pharmacy Co., Ltd.. (100%), Jinzhong Yuci Guoda Wanmin Clinic Co., Ltd (100%), Sinopharm
Holding Guoda Jianfeng (Jiangmen) Medicine Chain Co., Ltd (100%) and Guoda Wanmin Huimin Kangwei
Pharmacy Lvliang Co., Ltd. (51%).
(2) During the reporting period, the Company completed the capital increase (100%) to Sinopharm Holding
Maoming Co., Ltd, after capital increase, the shareholding ratio remained unchanged.
33
(3) During the reporting period, the Company made an additional investment in Guangdong Jianhui Construction
Investment Management Co., Ltd（10%） after additional investment, the shareholding ratio remained unchanged.
More investment information, found in the Note (V)-9, Note (VI) and Note (VII) carried in the financial report.
2. The major equity investment obtained in the reporting period
□ Applicable √ Not applicable
3. The major non-equity investment doing in the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
□ Applicable √ Not applicable
The company had no securities investment in the reporting period.
(2)Derivative investment
□ Applicable √ Not applicable
The company had no derivative investment in the reporting period.
5. Application of raised proceeds
√ Applicable □ Not applicable
In 10 thousand Yuan
Projects Amount of
The date Project
Committed investment changed Total Total accumulateInvestment
Amount when the Reach the feasibility
projects and capital or not committed investment d program Realized
invested in project predicted was
invested in areas with (includin investment after investment till the interests
report reaches its interest or changed
fund raising out of the g of raised adjustment till the period-end in Period
period intended not hugely or
plan changed capitals (1) period-end (3)=(2)/(1)
availability not
partially) (2)
Committed investment projects
Cash consideration of
49% equity of
Not Not Not
Guangdong Nanfang
N 26,781.67 26,781.67 4,892.15 26,781.67 100.00% applicabl applicabl applicabl N
Pharmaceutical
e ee
Foreign Trade Co., Ltd.
paid
34
Not Not Not
Payment of issuance
N 579.82 579.82 0 579.82 100.00% applicabl applicabl applicabl N
cost
e ee
Not
Subtotal of committed
-- 27,361.49 27,361.49 4,892.15 27,361.49 -- -- applicabl -- --
investment projects
e
Capital invested in areas with fund raising out of the plan
Not applicable
Not
Total -- 27,361.49 27,361.49 4,892.15 27,361.49 -- -- applicabl -- --
e
Situation about not
coming up to schemed
progress or expected
Not applicable
revenue and the
reason(In specific
project)
Explanation on major
changes on project Not applicable
feasibility
Amount, usage and
progress of using for
Not applicable
fund raising out of the
plan
Change of
implementation place
Not applicable
of investment project
of raised capitals
Regulation of
implementation ways
Not applicable
of investment project
of raised capitals
Preliminary investment
and replacement of
Not applicable
investment project of
raised capitals
Temporarily
supplement for the
Not applicable
current capitals with
idle raised capitals
35
Amount and reason for
surplus of raised
Not applicable
capitals when
implementing projects
Usage of the retained
raised fund and what is
No unspent raised funds
expected to invested
with those fund
Issues or other
conditions found in use Use of the fund raised are strictly execute in line with the tri-party supervision agreement for fund raised,
of fund raised and and no related issues or other conditions been found
disclosure
(3) The changed project of raised proceeds
□ Applicable √ Not applicable
The Company has no project of raised proceeds changed in the Period.
VI. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company has no sales of major assets in the Period.
2. Sales of major equity
□ Applicable √ Not applicable
VII. Analysis of main holding company and stock-jointly companies
√ Applicable □ Not applicable
Subsidiary and joint-stock enterprise with an impact of more than 10% on the Company’s net profit
In RMB
Company Register Operating Operating
Type Main business Total assets Net assets Net profit
name capital revenue profit
Sales of drugs,
Sinopharm medical apparatus
Holding and instruments, 3,553,249,39 16,020,031,3 4,653,577,09 30,583,358,1 774,030,623. 579,817,808.7
Subsidiary
Guangzho freight 3.17 32.98 5.40 96.47 98 5
u Co., Ltd. transportation,
storage, loading and
36
unloading, glass
wares, cosmetics and
daily merchandise;
other business
services, other
professional
consultation, various
goods agency and
for self-operation,
import & export of
technology, houses
leasing
Chinese traditional
patent medicine,
chemical
preparations,
antibiotics,
bio-chemical
medicine, biological
medicine, diagnosis
Sinopharm medicine, biological
Holding medicine with
1,683,333,33 15,456,873,7 5,539,462,64 19,437,660,1 655,446,001. 476,588,088.9
Guoda Subsidiary features of treatment
3.00 21.83 4.54 00.65 06 5
Drugstore and diagnosis,
Co., Ltd. shaped packing food,
chemical products,
and various
commodity and
technique hold by
self-support and
agency as well as
import & export of
technology
Retail and
distribution in
respect of
Sinopharm
pharmaceutical
Holding 521,407,965. 4,357,209,98 1,161,715,39 6,142,028,88 204,722,034. 179,046,206.0
Subsidiary products and
Guangxi 79 3.64 7.13 7.43 77 4
medical apparatus
Co., Ltd.
and instruments,
wholesale and retails
of health products
Particular about subsidiaries obtained or disposed in report period
37
√ Applicable □ Not applicable
The method of obtaining and handling The influence to the whole production and
Company name
subsidiaries during the report period performance
Expand the business layout of wholesale
Shanghai Dingqun Enterprise Management
Acquisition and retail integration, and without major
Consulting Co., Ltd
influence on performance of the Company
Expand the business layout of medicine
Beijing Golden Elephant Guoxing
Acquisition retail in local area, and without major
Pharmaceutical Co., Ltd.
influence on performance of the Company
Expand the business layout of wholesale
Shanghai Pudong New Area Medicine &
Acquisition and retail integration, and without major
Medication Co., Ltd.
influence on performance of the Company
Expand the business layout of medicine
Guoda Pharmacy (Rizhao) Co., Ltd. Establishment retail in local area, and without major
influence on performance of the Company
Expand the business layout of medicine
Liaoning Guoda Health Pharmacy Co.,
Establishment retail in local area, and without major
Ltd.
influence on performance of the Company
Expand the business layout of medicine
Sinopharm Accord (Yangjiang) Medicine distribution in local area, and without
Acquisition
Co., Ltd. major influence on performance of the
Company
Expand the business layout of medicine
Liaoning Guoda Pharmacy Co., Ltd. Establishment retail in local area, and without major
influence on performance of the Company
Expand the business layout of medicine
Liaoning Huludao Guoda Pharmacy Co.,
Establishment retail in local area, and without major
Ltd.
influence on performance of the Company
Expand the business layout of medicine
Jinzhong Yuci Guoda Wanmin Clinic Co.,
Establishment retail in local area, and without major
Ltd
influence on performance of the Company
Expand the business layout of medicine
Guoda Jianfeng (Jiangmen)
Establishment retail in local area, and without major
Pharmaceutical Chain Co., Ltd.
influence on performance of the Company
Expand the business layout of medicine
Guoda Wanmin Huimin Kangwei
Establishment retail in local area, and without major
Pharmacy Lvliang Co., Ltd.
influence on performance of the Company
Expand the business layout of wholesale
Chengda Fangyuan Pharmaceutical Group
Acquisition and retail integration, and without major
Co., Ltd
influence on performance of the Company
38
Explanation on main holding and stock-jointly enterprise
VIII. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
IX. Future Development Prospects
(i) Industry environment and its impact on the company
2021 is the first year of the "14th Five-Year Plan" of Sinopharm Accord, the environmental changes of the new
normal bring a series of opportunities and challenges. In the context of international trade frictions and the new
normal of China's economy, China's internal industrial structure upgrade pressure continues to increase, and
state-owned enterprises need to accelerate the pace of corporate reform and transformation to shift to high-quality
development. National competition has increasingly evolved into competition between urban agglomerations, how
to position state-owned enterprises to conform to national strategies, to be open and coordinated, and to develop
together with the region and form a joint force has become the key. Continuous breakthroughs in science and
technology will subvert the development model in various fields, and at the same time, it will also be a strong
support for China to improve its international competitiveness, we should actively explore the field of science and
innovation, seize opportunities for transformation, and build core competitiveness. The new medical reform
centered on the "three medical" linkages has promoted the redistribution of the interests of different participants in
the entire industry chain of the medical industry. The entire industry is in a period of structural adjustment and
model reshaping. The redistribution of the interests of the participants in the industry chain will generate new
businesses demand, bring new and diversified profit growth points.
(ii) Company business plan
In the new year, the company will focus on the strategy of “technology empowerment, service upgrade,
integration of wholesale and retail, and industry-finance dual drive”, and will continue to develop with high
quality. Strengthen traditional business on the one hand, further stimulate the vitality of traditional businesses,
become stronger and bigger, and consolidate the leading position in the industry; on the other hand, expand new
business, seize the window period, accelerate the development of new business scale and highlight the benefits.
1. Scientifically study and judge policies and situations, grasp market changes, and build a new development
pattern
Maintain sensitivity to policies and the environment, and respond quickly. Continue to seize the opportunity to
increase industry concentration and expand market share. Continue to research new business models, innovate and
empower, and improve profitability. Normalize the epidemic prevention of the COVID-19 epidemic, consolidate
the responsibilities of epidemic prevention, complete the emergency security, and provide the government with a
full network and a full range of medical supplies and emergency protection solutions. Pay attention to policy
dividends, under the new development pattern of "domestic big cycle, domestic and international double cycle",
continue to follow up and make full use of local government subsidy policies, and strive for more financing
39
support and corporate dividends brought by various preferential policies to reduce business costs and improve
efficiency.
2. Continue organizational transformation and build integrated service and management capabilities
Focus on the goals and tasks of the "14th Five-Year" strategic plan, strengthen publicity and implementation,
supervise implementation, and enhance the strategic management and control capabilities, the integrated
management and control capabilities, the personalized resource allocation capabilities, the innovative and
developmental operation management systems, and the cultural characteristics led by party building. Continue to
implement the annual human efficiency management and control requirements, and explore the development of
management, talents, and organizations based on future scale changes. Continue to improve the systematic,
professional and standardized financial management and control system. Keep an eye on changes in the industry,
and strive to promote the incubation of innovative capabilities and projects such as new businesses, new models,
and digital transformation.
3. Fully focus on technological empowerment, drive innovative services and supply chain upgrades with
digitalization, and create future-oriented core competitiveness
From the two levels of supply chain operation and management, with the goal of improving quality and efficiency,
and taking the new business model as the direction to promote digital transformation. The "professional +
regional" dual-combined management approach optimizes the organizational structure of the information
technology center, continues corporate operation, lays a solid foundation for digital transformation, and efficiently
promotes informatization projects.
4. Fully plan and integrate national logistics network resources, improve efficiency, optimize models, and
establish strategic advantages
Guided by business development needs, actively realize the transformation of logistics marketization, and build a
leading pharmaceutical supply chain enterprise in terms of logistics cost, logistics efficiency, network coverage,
and customer service experience.
5. Focus on customer value orientation, coordinate resources and networks, and focus on service upgrades and
model innovation
The distribution business segment promotes the strategic deployment and resources allocation of one body and
two wings, and continues to promote the company's high-quality development around "digital transformation,
integrated operation, supply chain upgrade, and business innovation". Focus on policy and market changes,
structural optimization and model upgrades, cultivate new growth points, and form new growth drivers. Create a
characteristic retail service system, promote model innovation under the integration of retail networks, and build
the core competitiveness of professional services. Rapidly cultivate innovative businesses, improve the
informatization and standardized service capabilities of medicines and consumables, and provide overall solutions
and integrated service capabilities.
In the retail business segment, we will seize the new pharmaceutical retail opportunities and promote the
integration of online and offline businesses. Promote the optimization of "product + service" professional
capabilities and create a closed loop of "medical + pharmaceutical" services. Continue to improve the integrated
management and control capabilities of the headquarters, and seek benefits from management.
40
6. Deeply explore the connotation and value of "integration of wholesale and retail", and promote the extension of
resources to the upstream and downstream of the industrial chain
Thoroughly implement the wholesale and retail integrated development strategy, on the basis of network linkage,
promote the effective allocation and circulation of resources in various formats and regions, enhance the synergy
and complementarity between distribution and retail, and create synergy. The wholesale and retail coordination is
implemented nationwide, and the integration of wholesale and retail in Guangdong and Guangxi continues to
deepen, with the help of the manufacturer resource platform of Sinopharm Holding and Sinopharm Accord, we
will jointly develop our own brands and cover the integrated network of wholesale and retail.
7. Realize simultaneous growth of "connotation + extension"
Through "improvement of quality and efficiency" and continuous lean management, we can achieve connotative
growth; through the focus strategy, we will promote investment and mergers and acquisitions to start a new
situation and achieve extensional growth.
(iii) Possible risks
1.Risks of changes in industry policy
With the continuous deepening of new medical reform, the pharmaceutical industry frequently releases policies,
and the operating environment of the industry has major changes, affected by the “4 + 7” centralized procurement
linkage and expansion, the GPO in Guangdong and Guangxi provinces, and the continuous expansion of the
national talks, and other policies, the drug price has continued to drop sharply, and the company’s profit margin is
facing the risk of further compression. The supervision has been continuously upgraded, the introduction of the
new Drug Administration Law and the implementation of the “four strictest” put forward higher requirements for
the compliance operation of pharmaceutical enterprises, the pharmaceutical circulation industry faces increased
risks of uncertain compliance. The company will respond to the impacts of industry policies by transforming and
upgrading its business structure, exploring new profit models, and improving its risk management and control
capabilities.
2. Management risks of the continuous expansion of marketing network of Guoda Drugstore
Through the continuous opening of new stores and extended M & A, the marketing network of Guoda Drugstore
has maintained a steady growth trend in recent years. The expansions of the sales areas and the increase in the
number of stores have put pressure on the store location, distribution, cash management, marketing and human
resource management of Guoda Drugstore. The company will strengthen management and construction in the
commodity procurement, logistics and delivery, sales and other links, and formulate corresponding management
measures in each link to ensure unified standards and management quality for store expansion, and at the same
time strengthen integration and control of new merged stores.
3. Risks of intensifying market competition
As the country continues to introduce corresponding policies to encourage the integration of pharmaceutical retail
industry, the major pharmaceutical retail enterprises in the industry have accelerated the pace of mergers and
acquisitions, and continued to expand the marketing networks, improve the logistics center constructions, and
41
innovate the business and profit models so that the sales scale and comprehensive strength continuously strengthen.
At the same time, with the upgrading of consumption and the gradual opening of market, the foreign pharmaceutical
distribution enterprises with powerful strength are entering the domestic pharmaceutical distribution markets
through a variety of ways, so the industry competition is further intensifying. In addition, the cross-border
competitors with internet genes have quickly penetrated into the company’s traditional business fields, which
brought certain challenges to the company’s business model.
The company will continue to integrate existing resources, deepen the strategic development initiatives with
wholesale-retail integration as the core, and deeply give play to the synergies, directly face the terminal patients
and consumers through complementary varieties, capital collaboration, supply chain collaboration, and
international promotion, at the same time, it will realize brand globalization by capital operation, and continuously
increase investment in scientific and technological innovation, and actively respond to cross-border competition.
4. Risks of facing the horizontal competition
In the pharmaceutical retail field, Sinopharm Holding’s affiliated distribution subsidiaries have also opened some
social retail pharmacies, which constitute a certain degree of horizontal competition with the subordinate Guoda
Drugstore. Sinopharm Holding and SINOPHARM have pledged to take effective measures to resolve the possible
horizontal competition.
5. The risk of goodwill impairments
On 31 December 2020, the book value of goodwill in consolidate financial statement listed as 2,747 million Yuan,
and distributed to the assets group of distribution business and retail business. In accordance with the Accounting
Standards for Business Enterprises, the Company carried out annual impairment test for the goodwill.
Impairment of goodwill will released on the Note V.-18 and Note III-17 & 33 listed under the Section XII.
Financial Report
X. Reception of research, communication and interview
1. In the report period, reception of research, communication and interview
√Applicable □ Not applicable
Main contents of
the discussion
Basic situation index of
Time Location Way Reception object Type and the
investigation
information
provided
Performance and Record of the investor
Accord
2020-04-22 Telephoning Institute Institute operation of the relations activities
Pharmacy Bldg.
Company (No.:2020-1)
42
Basic operating Resolution of the
Accord Institute, situation of the Annual General
2020-05-15 Field research Institute
Pharmacy Bldg. individual Company and Meeting 2019 (Notice
future outlook No.:2020-17)
Resolution of the First
Basic operating Extraordinary
Accord Institute,
2020-11-13 Field research Institute situation of the Shareholders’ General
Pharmacy Bldg. individual
Company Meeting of 2020
(Notice No.:2020-38)
Basic operating
Guoda Drugstore Jian
Accord situation of the
2020-12-22 Field research Other Time Finance Zhi Wan Jia Store of
Pharmacy Bldg. Company and
2021
future outlook
Reception (times) 4
Number of reception institutions 118
Number of individual reception 5
Number of other reception 1
Disclosed, released or let out major undisclosed
No disclosed, released or let out major undisclosed information
information
43
Section V. Important Events
I. Profit distribution plan of common stock and capitalizing of common reserves plan
Formulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially Cash Dividend policy during
the Reporting Period
√Applicable □ Not applicable
On 15 May 2020, the profit distribution plan for year of 2019 was deliberated and approved by annual general
meeting of 2019, that is taking total 428,126,983 shares as base, distributed 6.00 yuan (tax included) for each 10
shares in cash. The announcement of 2019 interest distribution implementation was released on 10 June 2020 by the
Board (published in Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao Website
http://www.cninfo.com.cn), the profit distribution plan for year of 2019 was completed, and dividend for public
shares was distributed to the account of shareholders dated 18 June 2020 (A-share) and 22 June 2020 (B-share)
respectively.
Special explanation on cash dividend policy
Satisfy regulations of General Meeting or requirement of Article of Association (Y/N): Y
Well-defined and clearly dividend standards and proportion (Y/N): Y
Completed relevant decision-making process and mechanism (Y/N): Y
Independent directors perform duties completely and play a proper role (Y/N): Y
Minority shareholders have opportunity to express opinions and demands totally and
Y
their legal rights are fully protected (Y/N):
Condition and procedures are compliance and transparent while the cash bonus policy
Not applicable
adjusted or changed (Y/N):
Profit distribution plan (pre-plan) of common stock and capitalizing of common reserves plan (pre-plan) in latest three years
(including the reporting period)
(1) Profit distribution plan for year of 2018
Taking the total 428,126,983 shares as base, cash bonus of 4.00 yuan (before tax) each 10 shares will be distributed
to the whole shareholders. This profit distribution did not convert capital reserve into share capital.
(2) Profit distribution plan for year of 2019
Taking the total 428,126,983 shares as base, cash bonus of 6.00 yuan (before tax) each 10 shares will be distributed
to the whole shareholders. This profit distribution did not convert capital reserve into share capital.
(3) Profit distribution plan for year of 2020
Taking the total 428,126,983 shares as base, cash bonus of 8.00 yuan (before tax) each 10 shares will be distributed
to the whole shareholders. This profit distribution did not convert capital reserve into share capital.
44
Cash dividend of common stock in latest three years (including the reporting period)
In RMB
Ratio of the
Ratio of the
Ratio of the total cash
cash bonus by
Net profit cash bonus in bonus (other
other ways in
attributable to net profit ways included)
Proportion for net profit
common stock attributable to Total cash in net profit
Year for Amount for cash cash bonus by attributable to
shareholders of common stock bonus attributable to
bonus bonus (tax other ways(i.e. common stock
listed company in shareholders of (including common stock
shares included) share shareholders of
consolidation listed company other ways) shareholders of
buy-backs) listed company
statement for contained in listed company
contained in
bonus year consolidation contained in
consolidation
statement consolidation
statement
statement
2020 342,501,586.40 1,401,892,593.23 24.43% 0.00 0.00% 342,501,586.40 24.43%
2019 256,876,189.80 1,271,289,183.01 20.21% 0.00 0.00% 256,876,189.80 20.21%
2018 171,250,793.20 1,210,742,435.78 14.14% 0.00 0.00% 171,250,793.20 14.14%
The Company gains profits in reporting period and the retained profit of common stock shareholders provided by parent company is
positive but no plan of cash dividend proposed of common stock
□ Applicable √ Not applicable
II. Profit distribution plan and capitalizing of common reserves plan for the Period
√Applicable □ Not applicable
Bonus shares for every 10-share (Share) 0.00
Dividends for every 10-share (RMB) (Tax included) 8.00
Increments per 10 shares (Share) 0.00
Equity base of the distribution plan (Share) 428,126,983
Amount of cash dividend(RMB) (Tax included) 342,501,586.40
Amount of cash dividend in other ways(i.e. share
0.00
repurchase)(RMB)
Total cash dividend (including other way) (RMB) 342,501,586.40
Profit available for distribution (RMB) 5,788,050,243.66
Proportion of total cash dividend (including other ways) to
100%
total profit distribution
Cash dividend situation
If the company’s development is at the growth stage with significant capital expenditures, the minimum proportion of cash
dividend in the profit distribution should reach 40%.
Detail explanation of the profit distribution plan or plan for capitalizing from public reserves
45
III. Implementation of commitment
1. Commitments completed in Period and those without completed till end of the Period from actual
controller, shareholders, related parties, purchaser and companies
√Applicable □ Not applicable
Type of Comm
Commitme Promise Commitme Impleme
commitm Content of commitments itment
nt reason by nt term ntation
ents date
"As a large pharmaceutical commercial enterprise whose business involves
pharmaceutical wholesale and retail, Sinopharm Holding may overlap with
the Company in geographical segmentation during its future business
development. To avoid the potential peer competition brought by such
geographical overlap, Sinopharm Holding undertakes that, upon the transfer
Commitme
of shares of Sinopharm Holding Guangzhou it held to Sinopharm Accord, “1.
nts in report Commit
Sinophar it will not newly-establish or broaden within Guangdong any business 21 Normally
of ment of Long-term
m operation that actually compete with that of Sinopharm Accord, or set up any June impleme
acquisition sharehold effective
Holding new subsidiaries or subordinate enterprises who engage in such business. 2. It 2005 nting
or equity ers
will enter into business delineation with Sinopharm Accord and Sinopharm
change
Holding Guangzhou, thereby giving the three parties clear geographical areas
to carry out pharmaceutical wholesale and retail businesses, so as to avoid
potential peer competition. Apart from above, Sinopharm Holding will no
longer newly-establish any enterprise that may compete with Sinopharm
Accord in the production and R&D of pharmaceutical products.”
"Sinopharm Group and Sinopharm Foreign Trade made commitments in the
Report about China National Accord Medicines Corporation Ltd. Purchasing
Assets and Raising Supporting Funds and Related Transactions by Asset Sale,
Sinophar
Stock Issuance and Cash Payment that the non-public offering of shares of
m Group
Sinopharm Accord obtained from this transaction shall not be transferred
Co.,
within 36 months since the finish date of issuance and shall be unlocked after
Ltd;Chin
36 months since the date of listing. Within 6 months after the completion of
Commitme a Commit
this transaction, if the closing price of the stock of Sinopharm Accord is less 31
nts in assets National ment on 36 Complet
than the issue price in continuous 20 trading days, or the closing price at the May
reorganizati Pharmace restricted months ed
end of 6 months after the completion of this transaction is less than the issue 2016
on utical shares
price, the lockup period of the stock of Sinopharm Group and Sinopharm
Foreign
Foreign Trade obtained from Sinopharm Accord by this transaction will
Trade
automatically prolong at least 6 months. The shares derived from stock
Corporati
dividends allocation and capital reserve increase transferring of Sinopharm
on
Accord based on the non-public offering of shares of Sinopharm Accord
obtained by this transaction should also abide by the above stock restricted
arrangements."
46
"Ping An Asset Management Co., Ltd. made commitments in the Report
about China National Accord Medicines Corporation Ltd. Purchasing Assets
Ping’an and Raising Supporting Funds and Related Transactions by Asset Sale, Stock
Commit
Assets Issuance and Cash Payment that the non-public offering of shares of 31
ment on Complet
Manage Sinopharm Accord obtained from this transaction shall not be transferred May 36 months
restricted ed
ment Co., within 36 months since the finish date of issuance and shall be unlocked after 2016
shares
Ltd 36 months since the date of listing. After placement completed, the shares of
the listed Company increased due to bonus shares and turning to increase
capital should pursuit to the restriction arrangement the above mentioned.
47
“Sinopharm Holding made commitments in the Report about China National
Accord Medicines Corporation Ltd. Purchasing Assets and Raising
Supporting Funds and Related Transactions by Asset Sale, Stock Issuance and
Cash Payment that the Company shall be the controlling shareholder of China
National Accord Medicines Corporation Ltd. (hereinafter referred to as
Sinopharm Accord) up to the issue date of this commitment letter, after the
completion of this major assets reorganization (hereinafter referred to as “this
reorganization”), Sinopharm Accord shall no longer hold shares or operate
relevant businesses of pharmaceutical industry, the main business will
become the national pharmaceutical retail and pharmaceutical distribution
business in Guangdong and Guangxi. In order to support the business
development of Sinopharm Accord and avoid horizontal competition with
Sinopharm Accord and its controlling enterprises, the Company made
following irrevocable commitments and promises:1, after the completion of
this reorganization, as for the social retail drugstore assets except for
Sinopharm Holding Guoda Drugstore Co., Ltd. and its subsidiaries and
branches owned or controlled by the Company, the Company promised to
take appropriate measures to solve the horizontal competition problem in the
pharmaceutical retail business between the Company and Sinopharm Accord
within 5 years since the completion date of this reorganization. 2. The
Company's way of resolving horizontal competition problems includes and is
not limited to purchasing the social retail drugstore assets subordinated to the
Commit Company by Sinopharm Accord, taking the entrusted operation, leasing or
ments on contracting operation by Sinopharm Accord and its controlling enterprises in
horizonta accordance with the methods permitted to national laws to hold or control the
l social retail drugstore assets, or transferring the controlling stake of the social
competiti retail drugstore assets by the Company. 3. If the shareholders of the social 28
Sinophar Normally
on, retail drugstore assets (hereinafter referred to as "the third party") of the Decem Long-term
m Group impleme
relation Company or the enterprises controlled by the Company have or are going to ber effective
Co., Ltd nting
transactio perform the preemptive rights under the same conditions in accordance with 2016
n and relevant laws and corresponding Articles of Association, then the above
capital commitment will not be applicable, but in this case, the Company should try
occupatio its utmost to urge the third party to waive its preemptive rights. If the
n Company is unable to urge the third party to give up the preemptive rights,
the Company will urge the enterprises controlled by the Company to transfer
the social retail drugstore assets to the third party to solve the horizontal
competition problem. 4. The pharmaceutical distribution assets currently
owned or controlled by the Company are distributed outside Guangdong and
Guangxi regions, there is no horizontal competition with Sinopharm Accord,
the Company will not engage in the same or similar operation businesses to
Sinopharm Accord in Guangdong and Guangxi in the future, if the Company
and its holding enterprises obtain the new business opportunities constituting
substantial horizontal competition (hereinafter referred to as competitive new
business) within the pharmaceutical distribution business scope of Sinopharm
Accord in Guangdong and Guangxi, the Company will send written notice to
Sinopharm Accord and try its utmost to firstly provide the new business
48
opportunities to Sinopharm Accord or its holding enterprises according to the
reasonable and fair terms and conditions so as to avoid the horizontal
competition with Sinopharm Accord and its holding enterprises. 5. Since the
“SINOPHARM made commitments in the Report about China National
Accord Medicines Corporation Ltd. Purchasing Assets and Raising
Supporting Funds and Related Transactions by Asset Sale, Stock Issuance and
Cash Payment that the Company shall be the actual controller of China
National Accord Medicines Corporation Ltd. (hereinafter referred to as
Sinopharm Accord) up to the issue date of this commitment letter, after the
completion of this major assets reorganization (hereinafter referred to as “this
reorganization”), Sinopharm Accord shall no longer hold shares or operate
relevant businesses of pharmaceutical industry, the main business will
become the national pharmaceutical retail and pharmaceutical distribution
business in Guangdong and Guangxi. In order to support the business
development of Sinopharm Accord and avoid horizontal competition with
Sinopharm Accord and its controlling enterprises, the Company made
following irrevocable commitments and promises:1, after the completion of
this reorganization, as for the social retail drugstore assets except for
Sinopharm Group Guoda Drugstore Co., Ltd. and its subsidiaries and
branches owned or controlled by the Company, the Company promised to
take appropriate measures to solve the horizontal competition problem in the
pharmaceutical retail business between the Company and Sinopharm Accord
within 5 years since the completion date of this reorganization. 2. The
Company's way of resolving horizontal competition problems includes and is
Commit
not limited to purchasing the social retail drugstore assets subordinated to the
ments on
Company by Sinopharm Accord, taking the entrusted operation, leasing or
horizonta
contracting operation by Sinopharm Accord and its controlling enterprises in
l
accordance with the methods permitted to national laws to hold or control the
competiti 28
social retail drugstore assets, or transferring the controlling stake of the social Normally
SINOPH on, Decem Long-term
retail drugstore assets by the Company. 3. If the shareholders of the social impleme
ARM relation ber effective
retail drugstore assets (hereinafter referred to as "the third party") of the nting
transactio 2016
Company or the enterprises controlled by the Company have or are going to
n and
perform the preemptive rights under the same conditions in accordance with
capital
relevant laws and corresponding Articles of Association, then the above
occupatio
commitment will not be applicable, but in this case, the Company should try
n
its utmost to urge the third party to waive its preemptive rights. If the
Company is unable to urge the third party to give up the preemptive rights,
the Company will urge the enterprises controlled by the Company to transfer
the social retail drugstore assets to the third party to solve the horizontal
competition problem. 4. The pharmaceutical distribution assets currently
owned or controlled by the Company are distributed outside Guangdong and
Guangxi regions, there is no horizontal competition with Sinopharm Accord,
the Company will not engage in the same or similar operation businesses to
Sinopharm Accord in Guangdong and Guangxi in the future, if the Company
and its holding enterprises obtain the new business opportunities constituting
substantial horizontal competition (hereinafter referred to as competitive new
business) within the pharmaceutical distribution business scope of Sinopharm
Accord in Guangdong and Guangxi, the Company will send written notice to
Sinopharm Accord and try its utmost to firstly provide the new business
49
opportunities to Sinopharm Accord or its holding enterprises according to the
reasonable and fair terms and conditions so as to avoid the horizontal
competition with Sinopharm Accord and its holding enterprises. 5. This
Sinopharm Holding made commitments in the Commitment Letter About Controlli
Sinopharm Group Co., Ltd. to Avoid Horizontal Competition: “First, the ng
Company and the Company’s wholly-owned, controlling or other enterprises sharehol
with actual control (in addition to Sinopharm Accord and its controlling der is
enterprises, hereinafter the same) don’t have businesses and operations impleme
constituting the substantial horizontal competition to Sinopharm Accord and nt in real
its controlling enterprises. Second, the Company and the Company’s earnest,
wholly-owned, controlling or other enterprises with actual control shall not Sinophar
Commitme engage, participate in or do businesses and activities in Guangdong and m
nts make in Guangxi which constitute substantial competition to Sinopharm Accord and Accord
Commit 5
initial Sinophar pharmaceutical business services. Third, the Company and the Company’s will
ment of Septe Long-term
public m wholly-owned, controlling or other enterprises with actual control shall not actively
sharehold mber effective
offering or Holding engage, participate in or do businesses and activities which constitute urged the
ers 2013
re-financin substantial competition to Sinopharm Accord and pharmaceutical industry controlli
g businesses. Fourth, the Company shall not take advantage of the control to ng
Sinopharm Accord to damage the legitimate rights and interests of Sinopharm sharehol
Accord and other shareholders (especially medium and small shareholders). der and
This commitment letter takes effect from the issue date, and remains in effect actual
for the entire period when the Company acts as the controlling shareholder or controlle
its related party of Sinopharm Accord. Within the effective period of the r to
commitment, if the Company violates this commitment and causes a loss to fulfill
Sinopharm Accord, the Company will timely make full compensation for commitm
Sinopharm Accord.” ents
50
Sinopharm Holding made commitments in the Commitment Letter About
Sinopharm Group Co., Ltd. to Regulate the Related Transactions with China
National Accord Medicines Corporation Ltd.: “First, when the Company is
controlling Sinopharm Accord, the Company and the companies and
enterprises directly and indirectly controlled by the Company (“related party”
for short) will strictly regulate the related transactions with Sinopharm
Accord and its controlling enterprises. Second, for the related transactions
that can not be avoided nor have reasonable reasons to occur, the Company
Controlli
and related party shall sign normative related transaction agreement in
ng
accordance with relevant laws with Sinopharm Accord. Sinopharm Accord
sharehol
implements the approval procedures and fulfills the information disclosure
der is
obligations of the related transactions according to relevant laws, regulations,
impleme
rules, other normative documents and the constitutions of Sinopharm Accord.
nt in real
Third, for the related transactions that can not be avoided or have reasonable
earnest,
reasons to occur, the Company and related party shall abide by the open, fair
Sinophar
and just market principles and confirm the price of related transactions in
m
accordance with the price that the independent third party without association
Accord
Commit sets for the same and similar transactions, and ensure the fairness of the price 5
Sinophar will
ment of of the related transactions. Fourth, when the board of directors and the Septe Long-term
m actively
sharehold general meeting of stockholders of Sinopharm Accord vote on the related mber effective
Holding urged the
ers transactions involving the Company and other enterprises controlled by the 2013
controlli
Company, the Company shall fulfill the necessary obligations that the
ng
associated directors and associated shareholders abstain from voting in
sharehol
accordance with the relevant provisions, and abide by the legal procedures for
der and
approving related transactions and the information disclosure obligations.
actual
Fifth, the Company guarantees to participate in the shareholders' general
controlle
meeting, equally exercise the corresponding rights and take the corresponding
r to
obligations in accordance with the constitutions of Sinopharm Accord, not to
fulfill
take advantage of controlling shareholder status to seek improper benefits or
commitm
utilize related transactions to illegally transfer the funds and profits of
ents
Sinopharm Accord, and not to damage the legitimate rights and interests of
other shareholders (especially the medium and small shareholders) of
Sinopharm Accord. Sixth, this commitment letter comes into force from the
issue date and remains in effect for the entire period when the Company acts
as the controlling shareholder or its related party of Sinopharm Accord.
Within the effective period of the commitment, if the Company violates this
commitment and causes a loss to Sinopharm Accord, the Company will
timely make full compensation for Sinopharm Accord.”
51
Actual
"SINOPHARM made commitments in the Commitment Letter About China Controlle
National Pharmaceutical Group Corporation to Avoid Horizontal Competition r is
with China National Accord Medicines Corporation Ltd.: “First, in the next impleme
five years, Sinopharm plans to take appropriate measures (including assets nt in real
replacement or acquisition, equity reorganization, etc.) to resolve the earnest,
horizontal competition between Sinopharm Weiqida and Sinopharm Accord. Sinophar
Second, in addition to the past matters and matters disclosed in this m
commitment letter, the Company and the Company’s wholly-owned, Accord
Commit controlling or other enterprises with actual control rights (except for will
16
SINOPH ment of Sinopharm Accord and its controlling enterprises, the same as below) shall Long-term actively
Octobe
ARM actual not directly engaged in, participate in or do the businesses an activities effective urged the
r 2013
controller constituting actual competition to the production and operation of Sinopharm controlli
Accord in China. The relevant commitments about avoiding horizontal ng
competition that the Company made in the past still remain in effect. Third, sharehol
the Company shall not take advantage of the control relationship to der and
Sinopharm Accord to damage the legitimate rights and interests of Sinopharm actual
Accord and its shareholders (especially the medium and small shareholders). controlle
Fourth, this commitment letter comes into force from the issue date and r to
remains in effect for the entire period when the Company acts as the fulfill
controlling shareholder or its related party of Sinopharm Accord.” commitm
ents
52
"SINOPHARM made commitments in the Commitment Letter About
Sinopharm Group Co., Ltd. to Regulate the Related Transactions with China
National Accord Medicines Corporation Ltd.: “First, when the Company is
controlling Sinopharm Accord, the Company and the companies and
enterprises directly and indirectly controlled by the Company (“related party”
for short) will strictly regulate the related transactions with Sinopharm
Actual
Accord and its controlling enterprises. Second, for the related transactions
Controlle
that can not be avoided or have reasonable reasons to occur, the Company
r is
and related party shall sign normative related transaction agreement in
impleme
accordance with relevant laws with Sinopharm Accord. Sinopharm Accord
nt in real
implements the approval procedures and fulfills the information disclosure
earnest,
obligations of the related transactions according to relevant laws, regulations,
Sinophar
rules, other normative documents and the constitutions of Sinopharm Accord.
m
Third, for the related transactions that can not be avoided or have reasonable
Accord
reasons to occur, the Company and related party shall abide by the open, fair
Commit 22 will
and just market principles and confirm the price of related transactions in
SINOPH ment of Septe Long-term actively
accordance with the price that the independent third party without association
ARM actual mber effective urged the
sets for the same and similar transactions, and ensure the fairness of the price
controller 2013 controlli
of the related transactions. Fourth, when the board of directors and the
ng
general meeting of stockholders of Sinopharm Accord vote on the related
sharehol
transactions involving the Company and other enterprises controlled by the
der and
Company, the Company shall fulfill the necessary obligations that the
actual
associated directors and associated shareholders abstain from voting in
controlle
accordance with the relevant provisions, and abide by the legal procedures for
r to
approving related transactions and the information disclosure obligations.
fulfill
Fifth, the Company guarantees not to take advantage of actual controller
commitm
status to seek improper benefits or utilize related transactions to illegally
ents
transfer the funds and profits of Sinopharm Accord, and not to damage the
legitimate rights and interests of other shareholders (especially the medium
and small shareholders) of Sinopharm Accord. Sixth, this commitment letter
comes into force from the issue date and remains in effect for the entire
period when the Company acts as the actual controller or its related party of
Sinopharm Accord.
Completed
on time Y
(Y/N)
2. Concerning assets or project of the Company, which has profit forecast, and reporting period still in
forecasting period, explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
53
IV. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable √ Not applicable
VI. Particulars about the changes in aspect of accounting policy, estimates and calculation
method compared with the financial report of last year
√Applicable □Not applicable
Accounting treatment of rent concessions related to the COVID-19 epidemic
According to the "Regulations on Accounting Treatment of Rental Concessions Related to the COVID-19
Epidemic", simplified methods can be selected for rent concessions related to the COVID-19 epidemic according
to the accounting treatment regulations. As the lessee, the Group adopted the simplified method in the accounting
treatment regulations for the relevant rent concessions for leases that occurred from January 1, 2020 (please refer
to the Financial Report, Section XII, Note iii, 29), and the amount of the relevant rent concessions included in
the profit for the year was 10,686,956.74 yuan.
VII. Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in the period.
VIII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
√Applicable □ Not applicable
Details of changes in consolidation statement’s scope can be seen in Note VI of Section XII. Financial Report.
IX. Appointment and non-reappointment (dismissal) of CPA
Accounting firm appointed
Name of domestic accounting firm Ernst & Young CPA (Special General partnership)
Remuneration for domestic accounting firm (in 10 thousand
594.57
Yuan)
Continuous life of auditing service for domestic accounting firm 5
54
Name of domestic CPA Li Jianguang, Li Yuanfen
Continuous life of CPA from the domestic accounting firm for
5
auditing service
Name of foreign accounting firm (if applicable) N/A
Re-appointed accounting firms in this period
□ Yes √ No
Appointment of internal control auditing accounting firm, financial consultant or sponsor
√Applicable □ Not applicable
In the Period, the Company engaged Ernst & Young CPA (Special General partnership) as the audit body for internal control, and
auditing charge for internal control amounting as 893,410yuan.
X. Particular about delisting after annual report disclosed
□ Applicable √ Not applicable
XI. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period.
XII. Significant litigations and arbitration of the Company
□ Applicable √ Not applicable
No significant litigations and arbitration occurred in the reporting period.
XIII. Penalty and rectification
□ Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.
XIV. Integrity of the company and its controlling shareholders and actual controllers
√Applicable □Not applicable
In reporting period, controlling shareholder and actual controller of the Company has a sound integrity , and there are no cases of
failure to implement the effective judgement of the court and the large amount of debt due and unliquidated
XV. Implementation of the company’s stock incentive plan, employee stock ownership plan or
other employee incentives
□ Applicable √ Not applicable
During the reporting period, the company has no stock incentive plan, employee stock ownership plan or other employee incentives
55
that have not been implemented.
XVI. Major related transaction
1. Related transaction with routine operation concerned
√ Applicable □ Not applicable
(1) Related transaction with routine operation concerned can be found in “X. Related party and related transaction”
carried in Section XII. Financial Report;
(2) The related transactions are settled in cash and by notes, according to the Proposal of Expected Routine
Related Transactions with Subordinate Enterprise for Year of 2020 deliberated and approved by 15th session of 8th
BOD held on 20 April 2020 and the Notice on Expected Routine Related Transaction for Year of 2020 (Notice No.:
2020-10) released on 22 April 2020, the related sales takes 75.82% in total expected amount for the whole year,
and related procurement takes 89.47% in total expected amount for the whole year.
2. Related transactions by assets acquisition and sold
□ Applicable √ Not applicable
3. Main related transactions of mutual investment outside
□ Applicable √ Not applicable
No main related transactions of mutual investment outside for the Company in reporting period.
4. Contact of related credit and debt
□ Applicable √ Not applicable
No contact of related credit and debt occurred in the reporting period
5. Other major related transactions
√ Applicable □ Not applicable
The Proposal on 100% Equity of Shanghai Dingqun Enterprise Management Consulting Co., Ltd. Acquisition by
Sinopharm Holding Guoda Drugstore Co., Ltd and Proposal on 75% Equity of Shanghai Pudong New Area
Medicine & Medication Co., Ltd. Acquisition by Sinopharm Holding Guoda Drugstore Co., Ltd were deliberated
and approved by 13th session of 8th BOD and Third Extraordinary Shareholders’ General Meeting of 2019. The
above mentioned target enterprises completed the equity delivery and registration change for industrial &
commerce in January 2020.
Relevant queries on the website of interim notices of major related party transaction disclosed
56
Interim Notice Date for disclosed Website for notice released
Sinopharm Accord: 75% Equity of Shanghai
Pudong New Area Medicine & Medication
Co., Ltd. Acquisition by Sinopharm Holding
2019-10-29 Juchao Website http://www.cninfo.com.cn
Guoda Drugstore Co., Ltd-controlling
subsidiary of the Company and Related Party
Transaction
Sinopharm Accord: 100% Equity of Shanghai
Dingqun Enterprise Management Consulting
Co., Ltd. Acquisition by Sinopharm Holding
Guoda Drugstore Co., Ltd-controlling
2019-10-29 Juchao Website http://www.cninfo.com.cn
subsidiary of the Company and Related Party
Transaction of the 85% Equity Acquisition of
Sinopharm Holding Tianhe Jiling Medical Co.,
Ltd.
XVII. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
The Company had no trusteeship in the reporting period.
(2) Contract
□ Applicable √ Not applicable
No contract for the Company in reporting period.
(3) Leasing
□ Applicable √ Not applicable
No leasing for the Company in reporting period.
2. Major guarantees
√Applicable □ Not applicable
(1) Guarantees
In 10 thousand Yuan
Particulars about the external guarantee of the Company and the subsidiaries (Barring the guarantee for subsidiaries)
57
Related Guarante
Announce Actual e for
Name of the Company Guarantee Actual date of Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit happening type term ted (Y/N)
disclosure limit party
date (Y/N)
Guarantee between the Company and the subsidiaries
Related Guarante
Announce Actual e for
Name of the Company Guarantee Actual date of Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit happening type term ted (Y/N)
disclosure limit party
date (Y/N)
Sinopharm Holding Joint liability 2020.5.20-20
2020-04-22 33,000 2020-05-20 26,912.64 N Y
Guangzhou Co., Ltd. assurance 21.5.20
Sinopharm Holding Joint liability 2020.5.20-20
2020-04-22 60,000 2020-05-20 60,000 N Y
Guangzhou Co., Ltd. assurance 21.5.19
Sinopharm Holding Joint liability 2020.12.8-20
2020-04-22 60,000 2020-12-08 5,584.3 N Y
Guangzhou Co., Ltd. assurance 21.12.3
Sinopharm Holding Joint liability 2020.3.31-20
2019-08-24 25,000 2020-03-31 5,903.18 N Y
Guangzhou Co., Ltd. assurance 21.3.30
Sinopharm Holding Joint liability 2020.5.20-20
2020-04-22 80,000 2020-05-20 58,822.52 N Y
Guangzhou Co., Ltd. assurance 21.5.19
Sinopharm Holding Joint liability 2020.1.15-20
2019-08-24 15,000 2020-01-15 10,536.4 N Y
Guangzhou Co., Ltd. assurance 21.1.14
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 20,000 2020-10-20 10,987.3 N Y
Guangzhou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.8.31-20
2020-04-22 47,000 2020-08-31 N Y
Guangzhou Co., Ltd. assurance 21.8.31
Sinopharm Holding Joint liability 2020.8.6-202
2020-04-22 5,000 2020-08-06 4,350.04 N Y
Guangzhou Co., Ltd. assurance 1.8.5
Sinopharm Holding Joint liability 2020.6.11-20
2020-04-22 5,000 2020-06-11 4,221.84 N Y
Guangzhou Co., Ltd. assurance 21.5.18
Sinopharm Holding
Joint liability 2020.5.20-20
Guangdong Yuexing 2020-04-22 5,000 2020-05-20 3,681 N Y
assurance 21.5.20
Co., Ltd.
Sinopharm Holding
Joint liability 2020.10.20-2
Guangdong Yuexing 2020-04-22 12,000 2020-10-20 5,927.63 N Y
assurance 021.10.19
Co., Ltd.
Sinopharm Holding
Joint liability 2020.9.10-20
Guangdong Yuexing 2020-04-22 15,000 2020-09-10 4,741.6 N Y
assurance 21.9.10
Co., Ltd.
58
Sinopharm Holding
Joint liability 2020.11.20-2
Guangdong Yuexing 2020-04-22 5,000 2020-11-20 N Y
assurance 021.11.19
Co., Ltd.
Sinopharm Holding
Joint liability 2020.9.27-20
Guangdong Hengxing 2020-04-22 15,000 2020-09-27 6,752.7 N Y
assurance 21.9.27
Co., Ltd.
Sinopharm Holding
Joint liability 2019.11.26-2
Guangdong Hengxing 2019-08-24 3,000 2019-11-26 471.07 N Y
assurance 020.11.25
Co., Ltd.
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 500 2020-10-20 28.1 N Y
Foshan Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.5.27-20
2020-04-22 3,000 2020-05-27 113.07 N Y
Foshan Co., Ltd. assurance 21.3.21
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 2,500 2020-10-20 1,743.72 N Y
Zhaoqing Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.6.5-202
2020-04-22 2,000 2020-06-05 809.89 N Y
Zhaoqing Co., Ltd. assurance 1.5.18
Sinopharm Holding Joint liability 2020.12.21-2
2020-04-22 3,000 2020-12-21 500.48 N Y
Zhaoqing Co., Ltd. assurance 021.3.11
Guangdong Nanfang
Pharmaceutical Joint liability 2020.7.1-202
2020-04-22 19,500 2020-07-01 12,501.91 N Y
Foreign Trade Co., assurance 1.6.30
Ltd.
Guangdong Nanfang
Pharmaceutical Joint liability 2020.10.16-2
2020-04-22 15,000 2020-10-16 4,957.04 N Y
Foreign Trade Co., assurance 021.10.15
Ltd.
Guangdong Nanfang
Pharmaceutical Joint liability 2020.9.27-20
2020-04-22 20,000 2020-09-27 20,000 N Y
Foreign Trade Co., assurance 21.9.27
Ltd.
Guangdong Nanfang
Pharmaceutical Joint liability 2020.10.20-2
2020-04-22 3,000 2020-10-20 N Y
Foreign Trade Co., assurance 021.10.19
Ltd.
Guangdong Nanfang
Pharmaceutical Joint liability 2020.11.12-2
2020-04-22 10,000 2020-11-12 973.82 N Y
Foreign Trade Co., assurance 021.11.3
Ltd.
Guangdong Nanfang 2020-04-22 10,000 2020-06-03 Joint liability 2020.6.3-202 N Y
59
Pharmaceutical assurance 1.5.18
Foreign Trade Co.,
Ltd.
Guangdong Nanfang
Pharmaceutical Joint liability 2020.9.25-20
2020-04-22 5,000 2020-09-25 N Y
Foreign Trade Co., assurance 21.9.24
Ltd.
Foshan Nanhai Joint liability 2020.10.20-2
2020-04-22 1,500 2020-10-20 404.48 N Y
Medicine Co., Ltd. assurance 021.10.19
Foshan Nanhai Joint liability 2020.5.27-20
2020-04-22 10,000 2020-05-27 3,151.99 N Y
Medicine Co., Ltd. assurance 21.3.21
Foshan Nanhai Joint liability 2019.11.7-20
2019-08-24 7,000 2019-11-07 32.04 N Y
Medicine Co., Ltd. assurance 20.11.6
Foshan Nanhai
Joint liability 2020.10.20-2
Uptodate & Special 2020-04-22 2,000 2020-10-20 N Y
assurance 021.10.19
Medicines Co. Ltd.
Foshan Nanhai
Joint liability 2020.5.27-20
Uptodate & Special 2020-04-22 10,000 2020-05-27 8,086.96 N Y
assurance 21.3.21
Medicines Co. Ltd.
Foshan Nanhai
Joint liability 2020.4.16-20
Uptodate & Special 2019-08-24 2,500 2020-04-16 97.9 N Y
assurance 20.12.23
Medicines Co. Ltd.
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 1,500 2020-10-20 501.44 N Y
(Jiangmen) Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.5.26-20
2020-04-22 3,000 2020-05-26 1,934.8 N Y
(Jiangmen) Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.9.21-20
2020-04-22 3,000 2020-09-21 2,497 N Y
(Jiangmen) Co., Ltd. assurance 21.9.20
Sinopharm Holding Joint liability 2020.7.13-20
2020-04-22 3,000 2020-07-13 2,890.32 N Y
(Jiangmen) Co., Ltd. assurance 21.7.13
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 1,000 2020-10-20 N Y
Meizhou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.6.29-20
2020-04-22 4,000 2020-06-29 1,900 N Y
Meizhou Co., Ltd. assurance 21.6.28
Sinopharm Holding Joint liability 2020.5.22-20
2020-04-22 5,000 2020-05-22 4,000 N Y
Meizhou Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.6.10-20
2020-04-22 3,000 2020-06-10 2,100 N Y
Meizhou Co., Ltd. assurance 21.5.31
Sinopharm Holding 2020-04-22 1,000 2020-10-20 850 Joint liability 2020.10.20-2 N Y
60
Zhongshan Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.11.18-2
2020-04-22 2,000 2020-11-18 714 N Y
Zhongshan Co., Ltd. assurance 021.11.17
Sinopharm Holding Joint liability 2020.9.7-202
2020-04-22 1,000 2020-09-07 725.58 N Y
Zhongshan Co., Ltd. assurance 1.5.18
Sinopharm Holding Joint liability 2020.8.17-20
2020-04-22 1,000 2020-08-17 406.94 N Y
Zhongshan Co., Ltd. assurance 21.8.14
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 500 2020-10-20 500 N Y
Shantou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.8.31-20
2020-04-22 3,000 2020-08-31 1,000 N Y
Shantou Co., Ltd. assurance 21.8.30
Sinopharm Holding Joint liability 2020.8.31-20
2020-04-22 2,000 2020-08-31 1,000 N Y
Shantou Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.6.1-202
2020-04-22 2,000 2020-06-01 1,000 N Y
Shantou Co., Ltd. assurance 1.5.31
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 1,000 2020-10-20 957.74 N Y
Huizhou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 3,000 2020-10-20 1,325.32 N Y
Huizhou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.9.7-202
2020-04-22 2,000 2020-09-07 1,797.07 N Y
Huizhou Co., Ltd. assurance 1.5.18
Sinopharm Holding Joint liability 2020.9.3-202
2020-04-22 1,000 2020-09-03 888.16 N Y
Huizhou Co., Ltd. assurance 1.9.2
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 2,000 2020-10-20 1,700 N Y
Zhanjiang Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.8.10-20
2020-04-22 5,000 2020-08-10 1,495 N Y
Zhanjiang Co., Ltd. assurance 21.8.9
Sinopharm Holding Joint liability 2020.6.3-202
2020-04-22 3,000 2020-06-03 1,420.24 N Y
Zhanjiang Co., Ltd. assurance 1.5.20
Sinopharm Holding Joint liability 2020.9.18-20
2020-04-22 3,000 2020-09-18 2,200 N Y
Zhanjiang Co., Ltd. assurance 21.9.17
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 1,000 2020-10-20 990.26 N Y
Zhuhai Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.8.5-202
2020-04-22 3,000 2020-08-05 2,929.1 N Y
Zhuhai Co., Ltd. assurance 1.8.4
Sinopharm Holding Joint liability 2020.7.3-202
2020-04-22 1,000 2020-07-03 899.4 N Y
Zhuhai Co., Ltd. assurance 1.5.18
Sinopharm Holding Joint liability 2020.5.15-20
2020-04-22 2,000 2020-05-15 2,000 N Y
Zhuhai Co., Ltd. assurance 21.5.15
61
Sinopharm Holding Joint liability 2020.5.29-20
2020-04-22 5,000 2020-05-29 2,000 N Y
Dongguan Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 2,000 2020-10-20 1,500 N Y
Dongguan Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.5.6-202
2020-04-22 3,000 2020-05-06 N Y
Dongguan Co., Ltd. assurance 1.2.27
Sinopharm Holding Joint liability 2020.6.24-20
2020-04-22 3,000 2020-06-24 N Y
Dongguan Co., Ltd. assurance 21.6.23
Guangdong Dongfang
Joint liability 2020.5.11-20
New Special Medicine 2020-04-22 10,000 2020-05-11 9,822.06 N Y
assurance 21.5.10
Co., Ltd
Guangdong Dongfang
Joint liability 2020.5.20-20
New Special Medicine 2020-04-22 5,000 2020-05-20 3,973.49 N Y
assurance 21.4.10
Co., Ltd
Guangdong Dongfang
Joint liability 2020.4.9-202
New Special Medicine 2019-08-24 3,000 2020-04-09 2,982.62 N Y
assurance 1.3.16
Co., Ltd
Guangdong Dongfang
Joint liability 2020.10.19-2
New Special Medicine 2020-04-22 9,000 2020-10-19 4,672.46 N Y
assurance 021.10.18
Co., Ltd
Guangdong Dongfang
Joint liability 2020.10.20-2
New Special Medicine 2020-04-22 4,000 2020-10-20 3,572.57 N Y
assurance 021.10.19
Co., Ltd
Guangdong Dongfang
Joint liability 2020.4.16-20
New Special Medicine 2019-08-24 2,500 2020-04-16 2,483.1 N Y
assurance 20.12.23
Co., Ltd
Sinopharm Holding Joint liability 2020.5.29-20
2020-04-22 3,000 2020-05-29 1,348.06 N Y
Shaoguan Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.6.10-20
2020-04-22 2,000 2020-06-10 1,900 N Y
Shaoguan Co., Ltd. assurance 21.5.31
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 1,000 2020-10-20 N Y
Shaoguan Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.5.26-20
2020-04-22 5,000 2020-05-26 N Y
Maoming Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.7.28-20
2020-04-22 3,000 2020-07-28 537.72 N Y
Maoming Co., Ltd. assurance 21.7.27
Sinopharm Holding
Joint liability 2020.6.8-202
Guangzhou Huadu 2020-04-22 2,000 2020-06-08 599.42 N Y
assurance 1.6.7
Co., Ltd.
62
Sinopharm Holding
Joint liability 2020.9.27-20
Guangzhou Huadu 2020-04-22 3,000 2020-09-27 2,647.74 N Y
assurance 21.9.27
Co., Ltd.
Sinopharm Holding
Joint liability 2020.9.1-202
Guangzhou Huadu 2020-04-22 2,000 2020-09-01 N Y
assurance 1.5.24
Co., Ltd.
Sinopharm Holding Joint liability 2020.5.21-20
2020-04-22 5,000 2020-05-21 4,480 N Y
Heyuan Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.8.3-202
2020-04-22 3,000 2020-08-03 N Y
Heyuan Co., Ltd. assurance 1.5.31
Sinopharm Holding
Foshan Medical Joint liability 2019.11.7-20
2019-08-24 1,000 2019-11-07 3.59 N Y
Supplies Supply Chain assurance 20.11.6
Co., Ltd.
Sinopharm Accord
Joint liability 2020.6.17-20
(Guangzhou) 2020-04-22 1,000 2020-06-17 N Y
assurance 21.5.18
Medicine Co., Ltd.
Sinopharm Accord
Joint liability 2020.8.17-20
(Guangzhou) 2020-04-22 1,000 2020-08-17 N Y
assurance 21.8.16
Medicine Co., Ltd.
Sinopharm Holding Joint liability 2020.6.28-20
2020-04-22 30,000 2020-06-28 6,796.17 N Y
Guangxi Co., Ltd. assurance 21.4.20
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 16,000 2020-10-20 9,316.12 N Y
Guangxi Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.2.17-20
2019-08-24 15,000 2020-02-17 14,172.04 N Y
Guangxi Co., Ltd. assurance 21.2.21
Sinopharm Holding Joint liability 2020.6.16-20
2020-04-22 20,000 2020-06-16 N Y
Guangxi Co., Ltd. assurance 21.6.15
Sinopharm Holding Joint liability 2020.5.28-20
2020-04-22 10,000 2020-05-28 N Y
Guangxi Co., Ltd. assurance 21.5.28
Sinopharm Holding Joint liability 2019.12.25-2
2019-08-24 25,000 2019-12-25 5,117.31 N Y
Guangxi Co., Ltd. assurance 020.12.25
Sinopharm Holding Joint liability 2020.9.1-202
2020-04-22 10,000 2020-09-01 N Y
Guangxi Co., Ltd. assurance 1.8.31
Sinopharm Holding Joint liability 2020.5.20-20
2020-04-22 20,000 2020-05-20 15,544.96 N Y
Guangxi Co., Ltd. assurance 21.5.19
Sinopharm Holding Joint liability 2020.9.11-20
2020-04-22 15,000 2020-09-11 670 N Y
Guangxi Co., Ltd. assurance 21.9.10
Sinopharm Holding 2020-04-22 12,000 2020-05-29 11,088.12 Joint liability 2020.5.29-20 N Y
63
Guangxi Co., Ltd. assurance 21.5.18
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 5,000 2020-10-20 2,463.87 N Y
Liuzhou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.6.21-20
2020-04-22 10,000 2020-06-21 3,217.92 N Y
Liuzhou Co., Ltd. assurance 21.6.20
Sinopharm Holding Joint liability 2020.2.21-20
2019-08-24 10,000 2020-02-21 2,399.87 N Y
Liuzhou Co., Ltd. assurance 21.2.20
Sinopharm Holding Joint liability 2020.7.25-20
2020-04-22 5,000 2020-07-25 N Y
Liuzhou Co., Ltd. assurance 21.7.24
Sinopharm Holding Joint liability 2020.12.20-2
2020-04-22 10,000 2020-12-20 7,548.81 N Y
Liuzhou Co., Ltd. assurance 021.12.19
Sinopharm Holding
Medicine Supply Joint liability 2019.10.8-20
2019-08-24 1,000 2019-10-08 792 N Y
Chain Service assurance 20.10.7
(Guangxi) Co., Ltd.
Sinopharm Holding
Medicine Supply Joint liability 2020.7.1-202
2020-04-22 1,000 2020-07-01 N Y
Chain Service assurance 1.5.18
(Guangxi) Co., Ltd.
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 300 2020-10-20 99.11 N Y
Wuzhou Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.8.7-202
2020-04-22 2,000 2020-08-07 N Y
Wuzhou Co., Ltd. assurance 1.8.7
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 200 2020-10-20 N Y
Guilin Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 500 2020-10-20 N Y
Beihai Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 500 2020-10-20 291.76 N Y
Baise Co., Ltd. assurance 021.10.19
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 1,000 2020-10-20 N Y
Yulin Co., ltd. assurance 021.10.19
Sinopharm Holding
Joint liability 2020.2.17-20
Shenzhen Jianmin 2019-08-24 2,000 2020-02-17 900 N Y
assurance 21.2.17
Co., ltd.
Sinopharm Holding
Joint liability 2020.10.20-2
Shenzhen Jianmin 2020-04-22 3,000 2020-10-20 2,020.64 N Y
assurance 021.10.19
Co., ltd.
Sinopharm Holding Joint liability 2020.10.20-2
2020-04-22 500 2020-10-20 291.44 N Y
Shenzhen Medicinal assurance 021.10.19
64
Materials Co., Ltd.
Sinopharm Holding
Joint liability 2020.7.1-202
Shenzhen Medicinal 2020-04-22 1,000 2020-07-01 275.56 N Y
assurance 1.5.18
Materials Co., Ltd.
Sinopharm Holding
Joint liability 2020.10.20-2
Shenzhen Yanfeng 2020-04-22 4,000 2020-10-20 544.83 N Y
assurance 021.10.19
Co., Ltd.
Sinopharm Holding
Joint liability 2020.5.28-20
Shenzhen Yanfeng 2020-04-22 8,000 2020-05-28 4,523.99 N Y
assurance 21.5.28
Co., Ltd.
Sinopharm Holding
Joint liability 2020.5.25-20
Shenzhen Yanfeng 2020-04-22 10,000 2020-05-25 931.01 N Y
assurance 21.5.18
Co., Ltd.
Sinopharm Holding
Joint liability 2020.11.2-20
Shenzhen Yanfeng 2020-04-22 5,000 2020-11-02 5,000 N Y
assurance 21.7.13
Co., Ltd.
Sinopharm Accord
Medicines Supply Joint liability 2020.6.18-20
2020-04-22 5,000 2020-06-18 639.4 N Y
Chain (Shenzhen) Co., assurance 21.5.18
Ltd.
Sinopharm Accord
Medicines Supply Joint liability 2020.11.10-2
2020-04-22 3,000 2020-11-10 446.99 N Y
Chain (Shenzhen) Co., assurance 021.11.9
Ltd.
Total amount of actual
Total amount of approving
occurred guarantee for
guarantee for subsidiaries in report 897,000 1,378,272.95
subsidiaries in report period
period (B1)
(B2)
Total balance of actual
Total amount of approved
guarantee for subsidiaries at
guarantee for subsidiaries at the 934,000 440,530.74
the end of reporting period
end of reporting period (B3)
(B4)
Guarantees of subsidiaries to subsidiaries
Guarante
Related
e for
Announce Actual Implemen
Name of the Company Guarantee Actual date of Guarantee Guarantee
ment guarantee related
guaranteed limit happening type term ted (Y/N)
disclosure limit
party
date
(Y/N)
Sinopharm Holding
Joint liability 2020.10.21-2
Guoda Drugstore 2020-04-22 1,200 2020-10-21 888.72 N Y
assurance 021.10.20
Yangzhou Dadesheng
65
Chain Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.21-2
2020-04-22 1,200 2020-12-21 969.91 N Y
Yangzhou Dadesheng assurance 021.12.20
Chain Co., Ltd.
Fujian Guoda
Joint liability 2020.05.17-2
Drugstore Chain Co., 2020-04-22 1,800 2020-05-17 0 N Y
assurance 021.05.17
Ltd.
Fujian Guoda
Joint liability 2020.07.29-2
Drugstore Chain Co., 2020-04-22 1,200 2020-07-29 834.4 N Y
assurance 021.07.30
Ltd.
Fujian Guoda
Joint liability 2020.10.21-2
Drugstore Chain Co., 2020-04-22 1,800 2020-10-21 408.67 N Y
assurance 021.10.20
Ltd.
Sinopharm Holding
Guoda Fumei Joint liability 2020.06.29-2
2020-04-22 1,800 2020-06-29 280.84 N Y
Drugstore Shanghai assurance 021.06.28
Chain Co., Ltd.
Sinopharm Holding
Joint liability 2020.10.21-2
Guoda Drugstore 2020-04-22 6,000 2020-10-21 3,078.09 N Y
assurance 021.10.20
Guangdong Co., Ltd.
Sinopharm Holding
Joint liability 2020.12.21-2
Guoda Drugstore 2020-04-22 1,800 2020-12-21 736.9 N Y
assurance 021.12.20
Guangdong Co., Ltd.
Sinopharm Holding
Joint liability 2020.07.31-2
Guoda Drugstore 2020-04-22 6,000 2020-7-31 2,467.39 N Y
assurance 021.05.14
Guangdong Co., Ltd.
Taishan Sinopharm
Holding Guoda Joint liability 2020.10.21-2
2020-04-22 600 2020-10-21 9.16 N Y
Qunkang Drugstore assurance 021.10.20
Chain Co., Ltd.
Taishan Sinopharm
Holding Guoda Joint liability 2020.06.16-2
2020-04-22 600 2020-06-16 132.68 N Y
Qunkang Drugstore assurance 021.05.14
Chain Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.21-2
2020-04-22 1,800 2020-10-21 559.62 N Y
Guangxi Chain Co., assurance 021.10.20
Ltd.
Sinopharm Holding Joint liability 2020.12.21-2
2020-04-22 600 2020-12-21 371.92 N Y
Guoda Drugstore assurance 021.12.20
66
Guangxi Chain Co.,
Ltd.
China National Hebei
Joint liability 2020.10.21-2
Lerentang Medicine 2020-04-22 1,800 2020-10-21 843.16 N Y
assurance 021.10.20
Chain Co., Ltd.
China National Hebei
Joint liability 2020.06.03-2
Lerentang Medicine 2020-04-22 9,000 2020-06-03 7,117.41 N Y
assurance 021.05.14
Chain Co., Ltd.
Hunan Guoda
Minshentang Joint liability 2020.10.21-2
2020-04-22 1,800 2020-10-21 742.41 N Y
Drugstore Chain Co., assurance 021.10.20
Ltd.
Hunan Guoda
Minshentang Joint liability 2020.12.21-2
2020-04-22 1,200 2020-12-21 1,030.55 N Y
Drugstore Chain Co., assurance 021.12.20
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.21-2
2020-04-22 1,800 2020-10-21 475.65 N Y
Jiangmen Chain Co., assurance 021.10.20
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.04.01-2
2019-08-24 1,200 2020-04-01 963.51 N Y
Jiangmen Chain Co., assurance 021.04.01
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.21-2
2020-04-22 1,800 2020-12-21 991.67 N Y
Jiangmen Chain Co., assurance 021.12.20
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.28-2
2020-04-22 3,000 2020-12-28 877.75 N Y
Jiangmen Chain Co., assurance 021.12.27
Ltd.
Beijing Golden
Elephant Pharmacy Joint liability 2020.12.21-2
2020-04-22 4,200 2020-12-21 1,908.89 N Y
Medicine Chain assurance 021.12.20
Company Limited
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.21-2
2020-04-22 600 2020-12-21 545.14 N Y
Nanjing Chain Co., assurance 021.12.20
Ltd.
Sinopharm Holding 2020-04-22 3,000 2020-09-23 1,794.05 Joint liability 2020.09.23-2 N Y
67
Guoda Drugstore assurance 021.08.19
Inner Mongolia Co.,
Ltd
Sinopharm Holding
Guoda Drugstore Joint liability 2020.07.21-2
2020-04-22 1,800 2020-07-21 458.74 N Y
Inner Mongolia Co., assurance 021.07.21
Ltd
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.21-2
2020-04-22 6,000 2020-10-21 4,439.56 N Y
Inner Mongolia Co., assurance 021.10.20
Ltd
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.21-2
2020-04-22 4,800 2020-12-21 3,488.69 N Y
Inner Mongolia Co., assurance 021.12.20
Ltd
Sinopharm Holding
Guoda Drugstore Joint liability 2020.06.05-2
2020-04-22 1,800 2020-06-05 844.82 N Y
Inner Mongolia Co., assurance 021.05.14
Ltd
Sinopharm Holding
Joint liability 2020.05.19-2
Guoda Drugstore 2020-04-22 600 2020-05-19 520.52 N Y
assurance 021.05.14
Bayan Nur Co., Ltd.
Sinopharm Holding
Joint liability 2020.05.18-2
Guoda Drugstore 2020-04-22 600 2020-05-18 484.57 N Y
assurance 021.05.14
Hulun Buir Co., Ltd.
Sinopharm Holding
Joint liability 2020.10.21-2
Guoda Drugstore 2020-04-22 300 2020-10-21 275.14 N Y
assurance 021.10.20
Hulun Buir Co., Ltd.
Sinopharm Holding
Joint liability 2020.06.15-2
Guoda Drugstore 2020-04-22 600 2020-06-15 109.81 N Y
assurance 021.05.14
Ulanqab Co., Ltd.
Ningxia Guoda
Joint liability 2020.08.29-2
Drugstore Chain Co., 2020-04-22 2,400 2020-08-29 2,209.8 N Y
assurance 021.08.28
Ltd.
Sinopharm Holding
Joint liability 2019.10.14-2
Guoda Drugstore 2019-08-24 2,400 2019-10-14 641.2 N Y
assurance 020.10.13
Shandong Co., Ltd
Sinopharm Holding
Joint liability 2020.01.17-2
Guoda Drugstore 2019-08-24 1,200 2020-01-17 593.54 N Y
assurance 020.11.26
Shandong Co., Ltd
Shanxi Guoda 2020-04-22 3,600 2020-11-08 3,600 Joint liability 2020.11.08-2 N Y
68
Wanmin Drugstore assurance 021.11.07
Chain Co., Ltd.
Shanxi Guoda
Joint liability 2020.06.13-2
Wanmin Drugstore 2020-04-22 3,600 2020-06-13 2,160 N Y
assurance 021.06.12
Chain Co., Ltd.
Shanxi Guoda
Joint liability 2020.05.22-2
Wanmin Drugstore 2020-04-22 15,000 2020-05-22 11,100 N Y
assurance 021.05.14
Chain Co., Ltd.
Shanxi Guoda
Joint liability 2020.10.21-2
Wanmin Drugstore 2020-04-22 5,400 2020-10-21 4,698 N Y
assurance 021.10.20
Chain Co., Ltd.
Sinopharm Holding
Joint liability 2020.05.21-2
Guoda Shanxi 2020-04-22 15,000 2020-05-21 14,965.9 N Y
assurance 021.05.14
Medicines Co., Ltd.
Sinopharm Holding
Joint liability 2020.10.21-2
Guoda Shanxi 2020-04-22 1,200 2020-10-21 1,200 N Y
assurance 021.10.20
Medicines Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.11.27-2
2020-04-22 1,800 2020-11-27 1,571.53 N Y
Shanghai Chain Co., assurance 021.11.27
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.25-2
2020-04-22 2,400 2020-10-25 2,290.06 N Y
Shanghai Chain Co., assurance 021.10.24
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.10-2
2020-04-22 2,400 2020-10-10 46.81 N Y
Shanghai Chain Co., assurance 021.10.09
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.06.29-2
2020-04-22 3,000 2020-06-29 1,204.88 N Y
Shanghai Chain Co., assurance 021.06.28
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.09.11-2
2020-04-22 6,000 2020-09-11 5,897.87 N Y
Shenyang Chain Co., assurance 021.09.10
Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.21-2
2020-04-22 12,000 2020-10-21 9,381.13 N Y
Shenyang Chain Co., assurance 021.10.20
Ltd.
69
Sinopharm Holding
Guoda Drugstore Joint liability 2020.05.19-2
2020-04-22 13,800 2020-5-19 9,796.09 N Y
Shenyang Chain Co., assurance 021.05.14
Ltd.
Sinopharm Holding
Guoda Drugstore
Joint liability 2020.11.18-2
Xinjiang New Special 2020-04-22 3,000 2020-11-18 1,599.3 N Y
assurance 021.11.18
Medicine Chain Co.,
Ltd
Sinopharm Holding
Guoda Drugstore
Joint liability 2020.06.29-2
Xinjiang New Special 2020-04-22 1,800 2020-06-29 1,797.01 N Y
assurance 021.05.14
Medicine Chain Co.,
Ltd
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.29-2
2020-04-22 3,600 2020-12-29 350.67 N Y
Shanxi Yiyuan Chain assurance 020.12.28
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.05.02-2
2020-04-22 5,400 2020-05-02 4,060.04 N Y
Shanxi Yiyuan Chain assurance 021.05.01
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.08.20-2
2020-04-22 3,360 2020-8-20 2,503.28 N Y
Shanxi Yiyuan Chain assurance 020.11.16
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.11.28-2
2020-04-22 3,600 2020-11-28 3,599.82 N Y
Shanxi Yiyuan Chain assurance 021.11.27
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.10.21-2
2020-04-22 9,000 2020-10-21 4,514.35 N Y
Shanxi Yiyuan Chain assurance 021.10.20
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.04.10-2
2019-08-24 3,000 2020-04-10 0 N Y
Shanxi Yiyuan Chain assurance 021.04.09
Co., Ltd.
Sinopharm Holding
Joint liability 2020.05.26-2
Guoda Drugstore 2020-04-22 3,000 2020-05-26 504 N Y
assurance 021.05.25
Shanxi Yiyuan Chain
70
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.05.21-2
2020-04-22 4,200 2020-5-21 3,540.28 N Y
Shanxi Yiyuan Chain assurance 021.05.14
Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.21-2
2020-04-22 300 2020-12-21 121.78 N Y
Zhengzhou Chain Co., assurance 021.12.20
Ltd.
Inner Mongolia Guoda Joint liability 2020.06.03-2
2020-04-22 2,400 2020-06-03 2,313.55 N Y
Medicine Co., Ltd. assurance 021.05.14
Sinopharm Holding
Joint liability 2020.11.24-2
Tianhe Jilin Medicines 2020-04-22 6,000 2020-11-24 4,928.94 N Y
assurance 021.11.23
Co., Ltd.
Sinopharm Holding
Joint liability 2020.10.21-2
Tianhe Jilin Medicines 2020-04-22 3,000 2020-10-21 2,099.29 N Y
assurance 021.10.20
Co., Ltd.
Yushu Dinghe
Joint liability 2020.08.20-2
Medicine Technology 2020-04-22 1,800 2020-8-20 1,747.91 N Y
assurance 021.05.14
Co., Ltd.
Guoda Yihe Drugstore Joint liability 2020.09.23-2
2020-04-22 4,080 2020-09-23 3,692.49 N Y
Jilin Co., Ltd. assurance 021.09.22
Guoda Yihe Drugstore Joint liability 2020.07.15-2
2020-04-22 3,000 2020-07-15 171.95 N Y
Jilin Co., Ltd. assurance 021.07.15
Tianjin Guoda
Joint liability 2019.12.26-2
Drugstore Chain Co., 2019-08-24 300 2019-12-26 195.71 N Y
assurance 020.12.25
Ltd.
Sinopharm Holding
Joint liability 2020.12.21-2
Guoda Drugstore 2020-04-22 1,200 2020-12-21 746.8 N Y
assurance 021.12.20
Henan Chain Co., Ltd.
Sinopharm Holding
Joint liability 2020.06.11-2
Guoda Drugstore 2020-04-22 1,800 2020-06-11 398.86 N Y
assurance 021.05.14
Henan Chain Co., Ltd.
Sinopharm Holding
Guoda Drugstore Joint liability 2020.12.21-2
2020-04-22 1,800 2020-12-21 618.8 N Y
(Shenzhen) Chain Co., assurance 021.12.20
Ltd.
Liaoning Chengda
Joint liability 2020.11.15-2
Fangyuan Medicine 2020-10-22 13,200 2020-11-15 9,543.94 N Y
assurance 021.11.15
Chain Co., Ltd.
71
Liaoning Chengda
Joint liability 2020.11.17-2
Fangyuan Medicine 2020-10-22 4,800 2020-11-17 4,148.27 N Y
assurance 021.05.14
Chain Co., Ltd.
Liaoning Chengda
Joint liability 2020.10.22-2
Fangyuan Medicine 2020-10-22 6,000 2020-10-22 2,997.94 N Y
assurance 021.10.20
Chain Co., Ltd.
Liaoning Chengda 2020.12.21
Joint liability
Fangyuan Medicine 2020-10-22 6,000 2020-12-21 0 —2021.12.2 N Y
assurance
Chain Co., Ltd. 0
Shanghai Pudong New
Joint liability 2020.07.24-2
Area Medicine & 2020-04-22 3,000 2020-07-24 711.48 N Y
assurance 021.07.23
Medication Co., Ltd.
Guoda Drugstore
Joint liability 2020.06.15-2
(Pu'er) Songmao Co., 2020-04-22 1,200 2020-06-15 847.86 N Y
assurance 021.05.14
Ltd.
Guoda Drugstore
Joint liability 2020.09.01-2
(Pu'er) Songmao Co., 2020-04-22 1,200 2020-09-01 20 N Y
assurance 021.08.31
Ltd.
Yanji Xianghe Joint liability 2020.06.17-2
2020-04-22 1,800 2020-06-17 40.63 N Y
Medicines Co., Ltd. assurance 021.05.14
Liaoning Guoda Joint liability 2020.10.21-2
2020-04-22 600 2020-10-21 599.97 N Y
Medicines Co., Ltd. assurance 021.10.20
Liaoning Guoda Joint liability 2020.06.29-2
2020-04-22 3,000 2020-6-29 2,968.09 N Y
Medicines Co., Ltd. assurance 021.05.14
Fujian Guoda Joint liability 2020.07.29-2
2020-04-22 600 2020-07-29 443.8 N Y
Medicines Co., Ltd. assurance 021.07.30
Total amount of actual
Total amount of approving guarantee occurred guarantee for
267,840 599,503.63
for subsidiaries in report period (C1) subsidiaries in report period
(C2)
Total balance of actual
Total amount of approved
guarantee for subsidiaries at
guarantee for subsidiaries at the 270,540 171,833.96
the end of reporting period
end of reporting period (C3)
(C4)
Total amount of guarantee of the Company ( total of three above mentioned guarantee)
Total amount of approving Total amount of actual
guarantee in report period 1,164,840 occurred guarantee in report 1,977,776.58
(A1+B1+C1) period (A2+B2+C2)
Total amount of approved Total balance of actual
1,204,540 612,364.7
guarantee at the end of report guarantee at the end of
72
period (A3+B3+C3) report period (A4+B4+C4)
The proportion of the total amount of actually guarantee in the net
43.90%
assets of the Company (that is A4+ B4+C4)
Including:
Explanation on guarantee using the composite way
(2) Guarantee outside against the regulation
□ Applicable √ Not applicable
No guarantee outside against the regulation in Period.
3. Entrust others to cash asset management
(1) Trust financing
□ Applicable √ Not applicable
The Company had no trust financing in the reporting period.
(2) Entrusted loans
□ Applicable √ Not applicable
The company had no entrusted loans in the reporting period.
4.Material contract with routine operation concerned
□ Applicable √ Not applicable
5. Other material contracts
□ Applicable √ Not applicable
No other material contracts for the Company in reporting period.
XVIII. Social responsibility
1. Execution of social responsibility
“Social Responsibility Report of Sinopharm Accord in 2020” can be seen in Juchao website released on the same date
(http://www.cninfo.com.cn)
2. Execution of social responsibility of targeted poverty alleviation
The Company has not carried out targeted poverty alleviation in the reporting period and has no follow-up plan of targeted poverty
alleviation
73
3. Environment protection
The listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection department
□Yes √No
Voluntary disclosure
Name of
Major Distribution Executed
Quantity of Emission Approved
Company Pollutants Emission of Pollutant Total Excessive
Discharge Concentrati Total
/subsidiary and Method Discharge Discharge Emissions Discharge
Outlet on Emissions
Particular Outlet Standards
Pollutants
Discharge
Standards
of Water
Pollutants
for
Discharge Pharmaceuti
Main Luck
Nanotubes Outlet of cal industry 0.020 0.078
Pharmaceuti COD 1 15mg/L N/A
emissions Waste Mixing/Co ton/year ton/year
cals
Water mpounding
and
Formulation
Category
-GB21908-
2008
Discharge
Standards
of Water
Pollutants
for
Discharge Pharmaceuti
Main Luck
Ammonia Nanotubes Outlet of cal industry 0.0007 0.012
Pharmaceuti 1 0．5mg/L N/A
Nitrogen emissions Waste Mixing/Co ton/year ton/year
cals
Water mpounding
and
Formulation
Category
-GB21908-
2008
Discharge Discharge
Main Luck
Nanotubes Outlet of Standards 0.00007 0.0006
Pharmaceuti Phosphate 1 0.05mg/l N/A
emissions Waste of Water ton/year ton/year
cals
Water Pollutants
74
for
Pharmaceuti
cal industry
Mixing/Co
mpounding
and
Formulation
Category
-GB21908-
2008
Discharge
Standards
of Water
Pollutants
for
Discharge Pharmaceuti
Main Luck
Nanotubes Outlet of cal industry 0.004 0.020
Pharmaceuti BOD 1 5mg/L N/A
emissions Waste Mixing/Co ton/year ton/year
cals
Water mpounding
and
Formulation
Category
-GB21908-
2008
Discharge
Standards
of Water
Pollutants
for
Discharge Pharmaceuti
Main Luck
Nanotubes Outlet of cal industry 0.0026 0.036
Pharmaceuti SS 1 2mg/L N/A
emissions Waste Mixing/Co ton/year ton/year
cals
Water mpounding
and
Formulation
Category
-GB21908-
2008
Located in a
China
Nanotubes sewage 1.5008 7.306
National COD 1 23.10mg/L 60mg/L N/A
emissions treatment ton/year ton/year
Zhijun
station
China Ammonia Nanotubes 1 Located in a 0.73mg/L 10mg/L 0.0477 0.812 N/A
75
National Nitrogen emissions sewage ton/year ton/year
Zhijun treatment
station
Located in a
China Total
Nanotubes sewage 0.0017 0.041
National phosphor 1 0.027mg/L 0.5mg/L N/A
emissions treatment ton/year ton/year
Zhijun us
station
Located in a
China
Total Nanotubes sewage 0.4470 4.104
National 1 6.88mg/L 20mg/L N/A
nitrogen emissions treatment ton/year ton/year
Zhijun
station
Located in a
China Discharge
sewage 100mg/Nm
National VOCs after 5 2.30mg/m 0 0 N/A
treatment 3
Zhijun treatment
station
Class-IV
Discharge
water
Zhijun Nanotubes Outlet of 0.9244 2.16
COD 1 12.00mg/L standard in N/A
Pingshan emissions Waste ton/year ton/year
GB21908-2
Water
008
Class-IV
Sewage water
Zhijun Ammonia Nanotubes 0.0204 0.144
1 treatment 0.128mg/L standard in N/A
Pingshan Nitrogen emissions ton/year ton/year
station GB21908-2
008
Class-IV
Sewage water
Zhijun Total Nanotubes 0.0127 0.0216
1 treatment 0.039mg/L standard in N/A
Pingshan phosphorus emissions ton/year ton/year
station GB21908-2
008
Class-IV
Sewage water
Zhijun Total Nanotubes 0.0507 0.108
1 treatment 0.75mg/L standard in N/A
Pingshan nitrogen emissions ton/year ton/year
station GB21908-2
008
Emission
Located on standards of
Discharge
Zhijun the roof of the table 3 0.1208 5.90
SO2 after 1 1.02mg/m3 N/A
Pingshan the boiler in ton/year ton/year
treatment
room GB13271-2
014
76
Emission
Located on standards of
Discharge
Zhijun Nitrogen the roof of 24.00mg/m the table 3 2.8318 17.70
after 1 N/A
Pingshan oxides the boiler 3 in ton/year ton/year
treatment
room GB13271-2
014
Construction and operation of pollution prevention and control facilities
At present, the above-mentioned environmental pollution key monitoring units in which the Company has a shareholding have
established pollution prevention and control facilities for waste water. In the daily management process, enterprises establish
management procedures and operating instructions for environmental protection facilities, and ensure the normal and compliant
operation of anti-pollution facilities through system implementation and responsibility implementation. All enterprises are
continuously investing funds and stepping up the transformation and improvement of pollution prevention and control facilities to
ensure the stable operation of pollution prevention facilities and improve the disposal capacity of environmental protection facilities.
Environmental impact assessment of construction projects and other environmental protection administrative licenses
At present, the projects of all key monitoring units have carried out environmental impact assessments and obtained approvals. The
projects to be built also carry out the relevant administrative review procedures according to the “three simultaneous” requirements of
the environmental protection facilities of the construction project.
Emergency plan for environmental emergencies
At present, the above-mentioned environmental pollution key monitoring units in which the Company has a shareholding have
formulated the Emergency Plan for Environmental Emergencies and reported them according to the regulatory requirements of the
local regulatory authorities. According to the management requirements of the emergency plan, the key units regularly carry out
emergency plan drills to further provide the enterprises’ emergency response capability.
Environmental self-monitoring scheme
At present, the above-mentioned environmental pollution key monitoring units in which the Company has a shareholding have
established environmental self-detection scheme and plan, and implemented self-inspection, third-party detection and other monitoring
methods according to the government requirements. Relevant monitoring data and reports have been archived and saved.
Other environmental information that should be disclosed
The above two companies are joint stock companies of the Company. The Company and its holding subsidiaries are not listed as key
pollutant discharge units announced by the environmental protection department.
Relevant information on environment protection
Nil
XIX. Explanation on other significant events
□ Applicable √ Not applicable
77
No other significant events need to explain in the reporting period.
XX. Significant event of subsidiary of the Company
□ Applicable √ Not applicable
78
Section VI. Changes in Shares and Particulars about Shareholders
I. Changes in Share Capital
1. Changes in Share Capital
In Share
Before the Change Increase/Decrease in the Change (+, -) After the Change
Capitaliza
New
Proportio Bonus tion of Proportio
Amount shares Others Subtotal Amount
n shares public n
issued
reserve
65,498,15 -59,989,2 -59,989,2
I. Restricted shares 15.30% 5,508,883 1.29%
3 70 70
1.Shares hold by the state
2. State-owned legal 60,380,74 -54,874,9 -54,874,9
14.10% 5,505,770 1.29%
person’s shares 3 73 73
3. Other domestic -5,114,29 -5,114,29
5,117,410 1.20% 3,113 0.00%
shareholding 7 7
Including: Domestic -5,114,29 -5,114,29
5,114,297 1.19% 0 0.00%
legal person’s shares 7 7
Domestic nature
3,113 0.00% 3,113 0.00%
person shares
4.Foreign shareholding
Including: shares hold
by overseas legal person
Share hold by
overseas natural person
362,628,8 59,989,27 59,989,27 422,618,1
II. Unrestricted shares 84.70% 98.71%
30 0 0 00
307,744,3 59,989,27 59,989,27 367,733,6
1. RMB Ordinary shares 71.88% 85.89%
55 0 0 25
2. Domestically listed 54,884,47 54,884,47
12.82% 12.82%
foreign shares 5 5
3. Foreign shares listed
abroad
4. Other
79
428,126,9 428,126,9
III. Total shares 100.00% 100.00%
83 83
Reasons for share changed
√Applicable □Not applicable
When the company issued shares to purchase assets and raised matching funds in 2016, the non-publicly issued
shares with restrictions on sales were lifted from sales restrictions on January 6, 2020, and the number of shares
released from sales restrictions was 59,989,270 shares.
Approval of share changed
□Applicable √Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Progress of shares buy-back
□Applicable √Not applicable
Implementation progress of the reduction of repurchases shares by centralized bidding
□Applicable √Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose for the Company or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of restricted shares
√ Applicable □ Not applicable
In Share
Restricted
shares
Opening shares increased Shares released Ending shares Restricted
Shareholders Date for released
restricted in in Period restricted reasons
the
Period
Sinopharm Group 55,057,700 49,551,930 5,505,770 Non-public 6 Jan. 2020
80
Co., Ltd offering share
China National
Pharmaceutical Non-public
5,323,043 5,323,043 0 6 Jan. 2020
Foreign Trade offering share
Corp.
Ping An
Asset-ICBM -Ping
An Asset Xinxiang Non-public
2,557,148 2,557,148 0 6 Jan. 2020
No. 7 Insurance offering share
Asset Management
Product
Ping An
Asset-ICBM -
Non-public
Xinxiang No. 3 2,557,149 2,557,149 0 6 Jan. 2020
offering share
Asset Management
Product
Total 65,495,040 59,989,270 5,505,770 -- --
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□Applicable √Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and
liability structure
□Applicable √Not applicable
3. Current internal staff shares
□ Applicable √ Not applicable
III. Particulars about shareholder and actual controller of the Company
1. Amount of shareholders of the Company and particulars about shares holding
In Share
Total common Total common Total preference Total preference
stock 42,036 stock 45,466 shareholders with 0 shareholders 0
shareholders in shareholders at voting rights with voting
81
reporting end of last month recovered at end of rights recovered
period-end before annual reporting period (if at end of last
report disclosed applicable) (found month before
in note 8) annual report
disclosed (if
applicable)
(found in note 8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Total Number of share pledged/frozen
Amount Amount
Proportio sharehold
Changes of of
Full name of Nature of n of ers at the
in report lock-up un-restrict
Shareholders shareholder shares end of State of share Amount
period shares ed shares
held report
held held
period
Sinopharm Group State-owned 239,999,9 234,494,2
56.06% 5,505,770
Co., Ltd Corporation 91 21
Hong Kong
Foreign 12,580,66 12,580,66
Securities Clearing 2.94%
Corporation 5 5
Company Ltd
FIRST SENTIER
INVESTORS
GLOBAL
Foreign 11,469,64 11,469,64
UMBRELLA 2.68%
Corporation 4 4
FUND PLC -
FSSA CHINA
GROWTH FUND
National Social Domestic non
Security Fund 118 state-owned 1.59% 6,791,699 6,791,699
Portfolio Corporation
China National
Pharmaceutical State-owned
1.24% 5,323,043 5,323,043
Foreign Trade corporate
Corp.
Central Huijin State-owned
0.89% 3,804,400 3,804,400
Investment Ltd. corporate
National Social Domestic non
Security Fund 413 state-owned 0.86% 3,675,031 3,675,031
Portfolio Corporation
National Social Domestic non
Security Fund 115 state-owned 0.82% 3,500,000 3,500,000
Portfolio Corporation
82
BBH BOS S/A
FIDELITY FD - Foreign
0.78% 3,358,761 3,358,761
CHINA FOCUS Corporation
FD
Fidelity Investment
Management
Foreign
(Hong Kong) 0.54% 2,308,237 2,308,237
Corporation
Limited - Client’s
fund
Sinopharm Group Co., Ltd. and China National Pharmaceutical Foreign Trade Corporation
have the same actual controller, which is China National Pharmaceutical Group
Explanation on associated relationship
Corporation. It is unknown that there exists no associated relationship or belongs to the
among the aforesaid shareholders
consistent actionist among the other tradable shareholders regulated by the Management
Measure of Information Disclosure on Change of Shareholding for Listed Companies.
Particular about top ten common shareholders with un-restrict shares held
Amount of un-restrict common shares held at Type of shares
Shareholders
period-end Type Amount
RMB ordinary
Sinopharm Group Co., Ltd 234,494,221 234,494,221
shares
Hong Kong Securities Clearing RMB ordinary
12,580,665 12,580,665
Company Ltd shares
FIRST SENTIER INVESTORS Domestically
GLOBAL UMBRELLA FUND PLC - 11,469,644 listed foreign 11,469,644
FSSA CHINA GROWTH FUND shares
National Social Security Fund 118 RMB ordinary
6,791,699 6,791,699
Portfolio shares
China National Pharmaceutical RMB ordinary
5,323,043 5,323,043
Foreign Trade Corp. shares
RMB ordinary
Central Huijin Investment Ltd. 3,804,400 3,804,400
shares
National Social Security Fund 413 RMB ordinary
3,675,031 3,675,031
Portfolio shares
National Social Security Fund 115 RMB ordinary
3,500,000 3,500,000
Portfolio shares
Domestically
BBH BOS S/A FIDELITY FD -
3,358,761 listed foreign 3,358,761
CHINA FOCUS FD
shares
Fidelity Investment Management RMB ordinary
2,308,237 2,308,237
(Hong Kong) Limited - Client’s fund shares
83
Expiation on associated relationship or Sinopharm Group Co., Ltd. and China National Pharmaceutical Foreign Trade Corporation
consistent actors within the top 10 have the same actual controller, which is China National Pharmaceutical Group
un-restrict shareholders and between Corporation. It is unknown that there exists no associated relationship or belongs to the
top 10 un-restrict shareholders and top consistent actionist among the other tradable shareholders regulated by the Management
10 shareholders Measure of Information Disclosure on Change of Shareholding for Listed Companies.
Whether top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held have a buy-back
agreement dealing in reporting period
□Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held of the Company have no
buy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: central state-owned holding
Type of controlling shareholders: legal person
Legal person/person
Controlling shareholders Date of foundation Organization code Main operation business
in charge of the unit
Industrial investment
holding; management and
assets reorganization
entrusted by pharmaceutical
enterprise; Chinese
medicine, Chinese
medicine tablets, chemical
medicine preparations,
chemical raw materials,
antibiotics, biochemical
drugs, biological products,
narcotic drugs,
Sinopharm Group Co., Ltd Yu Qingming 8 January 2003 74618434-4
psychotropic substances,
toxic drugs for medical use
(compatible with the
business scope), medicine
IVD Reagents, vaccine,
Anabolic agents, wholesale
of peptide hormones,
medical device operation,
food sales management
(non-physical method),
technology development,
technology transfer,
84
technical consultation,
technical service in the field
of medical technology,
chemical raw materials and
products (except hazardous
chemicals, monitoring
chemicals, fireworks and
firecrackers, flammables
and explosives, explosives
for civilian use), business
management consulting,
business consulting, market
information consulting and
investigation (no social
surveys, social
investigation, opinion
surveys, or opinion polls),
data processing services,
e-commerce (no
value-added
telecommunications
financial services), sales,
design, production agency,
publishing various domestic
and foreign advertisements
of disinfection products,
daily necessities, textiles
and knitwear, wholesale of
protective equipment for
medical staff, sales of labor
protection supplies, daily
mask (non-medical) sales,
sporting goods, household
appliances, electronic
products, furniture, toys,
edible agricultural products,
cosmetics, and cultural and
sports goods, domestic
trade (except special
license), logistics and
related consulting services,
operating various types of
goods and import and
export of technology (not
85
attached directory of import
and export commodities),
but excluded the import and
export of goods and
technology the State limits
or prohibit the company.
(with the exception of
projects subject to approval
according to the law, carry
out business activities
independently according to
the business license)
Equity of other
domestic/oversea listed
company control by Sinopharm Group Co., Ltd. hold 54.72 percent equity of China National Medicines Corporation Ltd
controlling shareholder as (Stock code: 600511) up to the end of Period.
well as stock-joint in report
period
Changes of controlling shareholders in reporting period
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period.
3. Actual controller of the Company and persons acting in concert
Nature of actual controller: central state-owned assets management
Type of actual controller: legal person
Legal
Organization
Actual controlling shareholders person/person in Date of foundation Main operation business
code
charge of the unit
86
Chinese patent drug, traditional Chinese
medicines prepared in ready-to-use forms,
traditional Chinese medicinal materials,
chemical API, chemical medicine
preparation, antibiotics, biochemical drug
and biologic pharmacy (License for
pharmaceutical trading runs until 12 May
2020); mandatory for pharmaceutical
China National Pharmaceutical enterprise, asset reorganization; consulting
Liu Jingzhen 26 March 1987 10000588-8
Group Corporation service of medicine industrial investment;
exhibition of medical devices; consulting
services with main business concerned. (the
enterprise has independent choices on
operation items for business; in right of
exequatur to run if refers to permission
operation ; operation activity that prohibited
or restricted by the City Government are not
allowed)
87
Name of listed Total shareholders
Proportion of
Name company with held (10 thousand
shares held
shares held shares)
SINOPHARM Jianmin Group 132.35 0.86%
Sinopharm
SINOPHARM 20,728.95 6.64%
Holding
Sinopharm
Holding
Sinopharm
Industrial 157,155.60 50.36%
Holding
Investment
Co., Ltd.
Sinopharm Sinopharm
41,284.17 54.72%
Equity of domestic/oversea Holding Holding
listed company control by Sinopharm Sinopharm
actual controller in report period 24,000.00 56.06%
Holding Accord
Sinopharm Lianhuan
375.21 1.30%
Group Pharmaceutical
Shyndec
SIPS 23,951.26 23.32%
Pharmaceutical
China National
Pharmaceutical Hengrui
21,862.02 4.10%
Investment Medicine
Co., Ltd.
China National
Biotec Group BTBP 62,673.65 49.96%
Co., Ltd.
SINOPHARM
China TCM 163,470.56 32.46%
H.K. Co., Ltd.
Changes of actual controller in reporting period
□ Applicable √ Not applicable
No changes of actual controllers for the Company in reporting period.
Property right and controlling relationship between the actual controller and the Company is as follow:
88
Actual controller controlling the Company by entrust or other assets management
□ Applicable √ Not applicable
4. Particulars about other legal person shareholders with over 10% shares held
□ Applicable √ Not applicable
5. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,
restructuring side and other commitment subjects
□ Applicable √ Not applicable
89
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period.
90
Section VIII. Convertible Bonds
□ Applicable √ Not applicable
The Company had no convertible bonds in the Period
91
Section IX. Particulars about Directors, Supervisors, Senior
Executives and Employees
I. Changes of shares held by directors, supervisors and senior executives
Amount Amount
Shares
Start of shares of shares Shares
End date held at Other
held at
Working dated of increased decreased
Title Sex Age of office period-be changes period-en
Name status office in this in this d
term gin (share)
term period period (Share)
(Share)
(Share) (Share)
Independ
Chen Currently 2018-04-
ent M 58 1,500 0 0 0 1,500
Shengqun in office 17
director
Deputy
GM,
Chen Currently 2015-01-
Secretary M 53 2,651 0 0 0 2,651
Changbin in office 13
of the
Board
Total -- -- -- -- -- -- 4,151 0 0 0 4,151
II. Changes of directors, supervisors and senior executives
√Applicable □ Not applicable
Name Title Type Date Reasons
Wei Pingxiao CFO Dismissal 2020-05-28 Job change, and no longer serves as the CFO
Gu Guolin CFO Appointment 2020-05-28 Appointed as CFO by the 8th BOD
Deputy
Ma Zhanjun Chairman, Office leaving 2020-07-31 Resigned due to the mandatory retirement age
Director
Job change, and o longer serves as Director and other
Li Zhiming Director Office leaving 2020-10-21
position of the Company
Wu Yijian Director Be elected 2020-11-13 New Director of 8th BOD
Lin Min Director Be elected 2020-11-13 New Director of 8th BOD
No longer serves as Director and other position of the
Li Dongjiu Director Office leaving 2021-03-02
Company for adjustment of work arrangement
92
III. Post-holding
Professional background, major working experience and present main responsibilities in Company of directors, supervisors and
senior executive at the present
1. Members of BOD
Mr. Liu Yong, joined Sinopharm Group Co., Ltd in January 2003 and serves as executive director and president
of Sinopharm Holding since November 2017 and acts as deputy party secretary of Sinopharm Holding since
January 2018; Mr. Liu own over 26 years of working experience, among which, over 23 years are related to
management experience in medicine and health care products industry. He is a pharmacist-in-charge and licensed
pharmacist. During the period from July 1992 to July 1999, Mr. Liu worked in the Shanghai Pharma, and
successively served as deputy general manager of the marketing department of Shanghai Branch of China
National Pharmaceutical Group Corporation and Shanghai Guoda Drugstore Chain Company Limited from July
1999 to April 2003. Mr. Liu served as GM and party secretary of the Sinopharm Holding Shenyang Co., Ltd from
April 2003 to November 2009; a deputy president of Sinopharm Holding from January 2009 to November 2017;
the Secretary of the Board of Sinopharm Holding from October 2016 to November 2017 and General Counsel of
Sinopharm Holding from January 2014 to December 2017. Currently, he also acts as the Director of
SINOPHARM, Sinopharm Holding Guoda Drugstore Co., Ltd., China National Scientific Instruments &
Materials Co., Ltd and China National Medical Equipment Co., Ltd.; and executive Director of Sinopharm
Holding Distribution Center Co., Ltd. Mr. Liu serves as Director of the 7th BOD of the Company since January
2017 and Chairman of the 7th and 8th BOD of the Company since October 2017.
Mr. Jiang Xiuchang, he has acted as vice president of Sinopharm Holding since July 2013. Mr. Jiang owns over 31
years of working experiences, among which, 20 years of management experiences are related to medicine and
health-care industries. He is a senior economist and senior accountant. Mr. Jiang has worked as deputy director of
information department, deputy director of restructuring office, deputy director of financial department as well as
deputy director of pharmaceutical department in China National Pharmaceutical Group Corporation from July
1986 to March 2002; he has also served as deputy director, director of financial department and chief financial
officer of China National Medicines Corporation Ltd. in succession from March 2002 to May 2010. Currently, Mr.
Jiang serves as Chairman of Sinopharm Holding Jiangxi Co., Ltd, Sinopharm Holding Tianjin Co., ltd. and
China National Medicines Corporation Ltd; Director of Sinopharm Holding H.K. Co., ltd and China National
Finance Corporation Ltd; and executive Director of Beijing Sinopharm Taiyuan Property Management Co., Ltd
and SINOPHARM Shanghai Co., Ltd; served as CFO of Sinopharm Holding from May 2010 to March 2021; he
serves as Director of the 6th ,7th and 8th BOD of the Company since March 2011.
Mr. Lian Wanyong is vice president of Sinopharm Group Co., Ltd. He joined China National Pharmaceutical
(Group) Corporation Guangzhou Company in 1996 and successively served as product director of Yuexing
Pharmaceutical Co., Ltd. and senior product manager of Hong Kong Tianjian International Co., Ltd. From August
93
2002 to January 2004, he served as deputy manager of the financial department of Barr laboratories, Inc., USA.
From January 2004 to June 2005, he was appointed as manager of operational audit department of China
Medicinal Materials Group Company. From July 2005 to January 2008, he was appointed as deputy director of
financial asset management department and director of investment management department of China National
Pharmaceutical (Group) Corporation. From December 2010 to February 2014, he served as deputy general
manager of Beijing Sinopharm Asset Management Center, from April 2014 to January 2018, he served as deputy
director of the Policy Research Office of China National Pharmaceutical Group Corporation. Since January 2018,
he has been serving as vice president of Sinopharm Group Co., Ltd., and Mr. Lian is concurrently serving as
chairman of Sinopharm Holding Anhui Co., Ltd., Sinopharm Holding Hubei Co., Ltd., and Sinopharm Holding
Changsha Co., Ltd., and director of China National Medicines Corporation Ltd., director of China National
Zhongjin (Shanghai) Medical Health Investment Management Co., Ltd, director of West China Dental Co., Ltd
and Director of Sinopharm Holding Hunan Co., Ltd. He serves as Director of 8th BOD of the Company since April
2018.
Mr. Wu Yijian, secretary of the board of Sinopharm Group Company Limited, and concurrently serves as the
president of many subsidiaries such as Sinopharm Group Shanxi and Sinopharm Inner Mongolia. Since July 1993,
he served in Sanjiu Enterprise Group and successively served as the sales director of Sanjiu Medical &
Pharmaceutical Trading Co., Ltd., the chief operating officer of Sanjiu Medical & Pharmaceutical Chain Co., Ltd.,
and the deputy general manager of Shanghai Sanjiu Technology Development Co., Ltd. Since June 2004, he
served in Fosun Pharmaceutical Group, and successively served as general manager of Shanghai Fosun
Pharmaceutical Investment Co., Ltd., general manager of Shanghai Fosun Pharmaceutical Co., Ltd., and general
manager of Shanghai Fumei Pharmacy Co., Ltd. From 2014 to the end of 2015, he served as the vice president of
Shanghai Yuyuan Tourist Mart Co., Ltd. Mr. Wu is currently serving as the president of China National Shanxi
Co., Ltd, Sinopharm Holding Shanxi Co., ltd, Sinopharm Holding Inner Mongolia Co., Ltd., China National
Health Online Co., Ltd, and a director of China National Zhongjin (Shanghai) Medical Health Investment
Management Co., Ltd, and director and general manager of Sinopharm Holding Group H.K. Co., Ltd. From
September 2016 to May 2019, he concurrently served as the chairman of the board of supervisors of Sinopharm
Accord. From November 2020, he serves as a director of the eighth board of directors of the Company.
Mr. Lin Zhaoxiong: Director and GM of Sinopharm Accord. Has served as deputy manager and manager of
pharmaceutical department, manager of Pharmaceutical corporations and director of operation and management
department during his work in China Pharmaceutical (Group) Guangzhou Co.,Ltd from January 1999 to
December 2003 in succession; He has acted as the deputy general manager of Sinopharm Holding Guangzhou
Co.,Ltd; the general manager of Sinopharm Holding Guangzhou Co.,Ltd from December 2006 to December
2008; He has served as the deputy general manager of the Company from December 2008 to March 2016; Mr
Lin serves as the chairman of Sinopharm Holding Guoda Drugstore Co.,Ltd since October 2017; and GM of the
Company since March 2016, Director of the 7th and 8th BOD of the Company since April 2016.
Mr. Lin Min is the deputy general manager of the Company. He worked in China National Pharmaceutical (Group)
94
Guangzhou Company from January 2001 to November 2003, successively served as assistant manager and deputy
manager of Pharmaceutical Department, deputy purchasing manager of Pharmaceutical Company, and served as
city pharmaceutical sales director of Sinopharm Guangzhou Co., Ltd. from November 2003 to January 2005, from
January 2005 to December 2008, he served as deputy general manager of Sinopharm Holding Guangzhou Co.,
Ltd., and concurrently served as general manager of Sinopharm Holding Guangzhou Co., Ltd. since March 2016.
He served as deputy general manager of the Company since December 2008, from November 2020, he has been
serving as a director of the seventh and eighth board of directors of the Company.
Mr. Chen Honghui, Professor and doctoral supervisor in Management of Lingnan (University) College. From July
1993 to June 2003, he worked in the School of Management of Wuhan University of Science and Technology as a
teaching assistant and lecturer. From July 2003 until now, he has been working in Lingnan (University) College as
an associate professor and professor. From 2007 to 2012, he served as the deputy dean of Lingnan (University)
College; from 2008 to 2019, he served as the director of the Business Management Department of Lingnan
(University) College. Since 2008, he has served as the director of the Research Center for Corporate Social
Responsibility of Lingnan (University) College. Mr. Chen is concurrently serving as the vice chairman of
Guangdong International Social Responsibility, independent director of Cabbeen Fashion Limited, and
independent director of Guangzhou Grandbuy Co., Ltd. Since March 2017, he has been serving as an independent
director of the seventh and eighth board of directors of the Company.
Mr. Ou Yongliang, Practicing Lawyer of China, Vice President of All China Lawyers Association, Vice President
of Guangdong Province Law Society, President of the 9th and 10th Guangdong Lawyers Association, director of
Guangdong Hopesun Law Firm, member of the 12th Guangdong Provincial Committee of CPPCC, expert
consultant of the 11th Party Congress of the Guangdong Provincial Committee of the Communist Party of China,
legislative consultant of the 12th Standing Committee of Guangdong Provincial People's Congress, specially
invited member of the 11th Guangdong Provincial Committee of the CPPCC, member of Judges and Procurators
Selection Committee of Guangdong Province, representative of the Ninth Congress of the Guangzhou
Municipality of the Communist Party of China, an arbitrator of the China International Economic and Trade
Arbitration Commission, an arbitrator of the Shenzhen Court of International Arbitration, an arbitrator of the
Shanghai Arbitration Commission, an arbitrator of the Guangzhou Arbitration Commission. Since April 2018, he
has been serving as an independent director of the eighth board of directors of the Company.
Mr. Chen Shengqun is an associate researcher and senior accountant, he has been teaching at the Shanghai
National Accounting Institute since 2013. Mr. Chen came out of the postdoctoral research station of Shanghai
University of Finance and Economics in 1998 as the first postdoctoral fellow in management accounting. He was
employed as a senior researcher at the CAFR Center of the Hong Kong Polytechnic University and is currently a
visiting professor of EDP curriculum at the Xiamen University. Since 1998, Mr. Chen has served as director of the
finance division of China Pacific Insurance Co., Ltd., in 2002, he was transferred to serve as deputy general
manager of the financing plan department of China Pacific Insurance Co., Ltd. (presiding work), at the end of
95
2003, he joined China Reinsurance Group and successively served as general manager of the fund application
department of China Continent Insurance (concurrently general manager of the strategic development department,
and general manager assistant of China Re Asset Management Company. He serves as independent director of the
8th BOD of the Company since April 2018.
Ms. Su Weiwei: Doctor of pharmacy, professor of School of Life Sciences of Sun Yat-Sen University and a doctoral
supervisor. She worked in Guangdong pharmaceutical University from July 1987 to April 2000, and successively
served as a teaching assistant, lecturers, associate professor and professor, she serves as a professor in Sun Yat-Sen
University since May 2000. Ms. Su Weiwei have devoted herself to the research and development of innovative
drugs for many years, and achieved two chemical clinical permission for first-type new drugs and one clinical
permission for the fifth-type new drugs of TCM (traditional Chinese medicine) which have independent
intellectual property rights.
2. Members of BOS:
Mr. Wen Deyong, joined Sinopharm Group Co., Ltd. in September 2017, and has been serving as a non-executive
director of Sinopharm Group Co., Ltd. to this day. From September 1995 to May 2016, Mr. Wen served as a
technician in the hydro-acupuncture workshop of Chongqing No. 6 Pharmaceutical Factory, field salesman of
sales department of Chongqing YaoPharma, sales director of Chongqing YaoPharma Co., Ltd., general manager of
sales department 2 of Chongqing YaoPharma Co., Ltd., general manager of Northern Company of Chongqing
Haisiman Pharmaceutical Co., Ltd., vice president of Chongqing YaoPharma, president of Chongqing YaoPharma,
currently serves as vice president of Shanghai Fosun Pharmaceutical (Group) Co., Ltd., director of pharmaceutical
business management committee, general manager of centralized procurement and procurement management
department, and executive vice president of Shanghai Fosun Pharmaceutical Industry Development Co., Ltd. He
has been the chairman of the board of supervisors of the eighth board of supervisors of the Company since July
2019.
Ms. Liu Jingyun, Director of the capital department of Sinopharm Group Co., Ltd. and he successively hold a
teaching post in Nanjing Radio and Television University, works in Sinopharm Group Co., Ltd. since November
2003 and serves as deputy director of assets management department, director of the financial & assets
management dept. and Director of ministry of finance and credit management. She serves as supervisor of the 7th
and 8th supervisory committee of the Company since September 2016.
Ms. Chen Guojing: she worked in Shenzhen Accord Medicinal Materials Company in December 1999, now she
serves as the office director and director of security department in the Company. Ms. Chen served as the financial
manager and deputy chief of Finance and Funds Department of the Company from June 2005 to December 2013,
she is the member of trade union federations of the Company and chairman of the first trade union since March
2009; she served as chief (part-time) of the auditing department of the Company from January 2013 to August
96
2017, and chief (part-time) of the risk and operation management of the Company from January 2014 to May
2016. She serves as staff supervisor of the 8th supervisory committee of the Company since August 2018
3. Senior executive:
Mr. Lin Zhaoxiong, found in aforesaid previous work experience
Mr. Lin Min, found in aforesaid previous work experience
Mr. Zhao Xiaochuan: Deputy GM of the Company. He has served as the general manager of Liaoning Accord
Chain Co., Ltd from December 2001 to April 2008; served as the general manager of Sinopharm Holding Guoda
Tian Yi Tang Drugstore Chain (Shenyang) Co., Ltd and Sinopharm Holding Guoda Shenyang Chain Co., Ltd from
May 2008 to June 2015; he has acted as general manager of Sinopharm Holding Guoda Drugstore Co., Ltd since
June 2015; serves as President of Sinopharm Holding Guoda Drugstore Co., Ltd. Since January 2021 and he has
worked as the deputy general mange of the Company since July 2017.
Mr. Liu Tianyao is deputy general manager of the Company. From August 2002 to April 2009, he served as senior
director of human resources department of China National Pharmaceutical Group Corporation. From April 2009
to May 2017, he successively served as deputy director of human resources department, director of talent
development department, director of human resources department, and director of retail medical business
development department of Sinopharm Group Co., Ltd., from December 2013 to July 2016, he concurrently
served as general manager of Shanghai Management Consulting Branch, from July 2016 to May 2017, he
concurrently served as general manager of Sinopharm Holding Medical Management (Shanghai) Co., Ltd., from
May 2017 to January 2019, he has been serving as director of human resources and director of human resources
department of Sinopharm Group Co., Ltd and he serves as Deputy GM of the Company since January 2019.
Mr. Lin Xinyang: Deputy GM of the Company.He took the turns of deputy GM of Nanfang Pharm. Co., deputy
GM of China Pharmaceutical (Group) Guangzhou Company Yuexing Company, general supervisor of PD of
Sinopharm Holding Guangzhou Company successively since January 1996; took the post of deputy GM of
Sinopharm Holding Guangzhou Company from Jan. to Dec. 2004; serves as deputy GM of the Company since
January 2005.
Mr. Lang Baochun is deputy secretary of the party committee, secretary of the disciplinary committee, chairman
of the labor union and general counsel of the Company. From September 2007 to March 2008, he served as
deputy director of general office of Sinopharm Group Co., Ltd., from March 2008 to December 2009, he served as
general manager of Shanghai Chuanghui Investment Co., Ltd., from January 2010 to May 2010, he served as
director of the research office of Shanghai Shibei Hi-Tech (Group) Co., Ltd., from June 2010 to September 2011,
he served as deputy director of the president’s office of Sinopharm Group Co., Ltd., from October 2011 to
December 2015, he served as director of the strategic planning department of Sinopharm Group Co., Ltd., from
97
January 2016 to June 2017, he served as secretary of the party committee of Sinopharm Guoda Drugstore Co.,
Ltd., from March 2016 to February 2018, he served as deputy secretary of the party committee and secretary of
the disciplinary committee of the Company. Since March 2018, he has been serving as deputy secretary of the
party committee, secretary of the disciplinary committee, and chairman of the labor union of the Company. He
serves as General Counsel of the Company since August 2018
Mr. Gu Guolin is the chief financial officer of the Company. He joined Sinopharm Group Co., Ltd. in May 2011,
and served as the senior manager of the financial management department of Sinopharm Group Co., Ltd. from
May to July 2011; from July 2011 to May 2014, he served as the chief financial officer of Sinopharm Holding
Ningxia Co., Ltd. Since May 2014, he has served as the chief financial officer of Sinopharm Sichuan
Pharmaceutical Group Co., Ltd. and concurrently as the chief financial officer of Sinopharm Holding Sichuan
Pharmaceutical Co., Ltd. Since May 2020, he has been serving as the chief financial officer of the Company.
Mr. Chen Changbin: Deputy GM of the Company, and Secretary of the Board. He has served as secretary of board
of directors of the Company since December 2000; he has also worked as the director of planning investment
management department of the Company as well as assistant general manager, in charge of strategic planning,
investment and mergers and acquisitions, capital operation, affairs related to three major meetings and
international co-operation. He has acted as the deputy general manager of the Company since April 2017.
Post-holding in shareholder’s unit
√ Applicable □ Not applicable
Whether to receive
Position in compensation and
Commencemen
Name Name of shareholder’s unit shareholder’s Termination date allowances in the
t date of tenure
unit shareholders’ unit
(Y/N)
Executive
Liu Yong Sinopharm Group Co., Ltd Director, 2017-11-01 Y
President
Deputy party
Liu Yong Sinopharm Group Co., Ltd 2018-01-01 Y
secretary
Deputy
Jiang Xiuchang Sinopharm Group Co., Ltd 2013-07-01 Y
President
Deputy
Lian Wanyong Sinopharm Group Co., Ltd 2018-01-01 Y
President
Secretary of
Wu Yijian Sinopharm Group Co., Ltd 2019-01-01 Y
the Board
Director of
Liu Jingyun Sinopharm Group Co., Ltd 2016-07-01 Y
Capital
98
department
Post-holding in other unit
√ Applicable □ Not applicable
Whether to
receive
Position in Commencemen
Name Name of other units Termination date compensation and
other unit t date of tenure
allowances in
other unit (Y/N)
Liu Yong China National Medicines Corporation Ltd Director 2017-11-01
Sinopharm Holding Guoda Drugstore Co.,
Liu Yong Director 2017-10-01
Ltd.
China National Scientific Instruments &
Liu Yong Director 2018-12-01
Materials Co., Ltd
China National Medical Equipment Co.,
Liu Yong Director 2018-12-01
Ltd.
Sinopharm Holding Distribution Center Co., Executive
Liu Yong 2020-08-01
Ltd Director
Jiang Xiuchang Sinopharm Holding Jiangxi Co., Ltd. President 2013-06-01
Executive
Jiang Xiuchang SINOPHARM Shanghai Co., Ltd 2017-11-01
Director
Jiang Xiuchang Sinopharm Holding Tianjin Co., Ltd. President 2013-12-01
Jiang Xiuchang China National Medicines Corporation Ltd President 2017-11-01
Jiang Xiuchang Sinopharm Holding H.K. Co., ltd Director 2011-11-01
Jiang Xiuchang China National Finance Corporation Ltd Director 2011-11-01
Beijing Sinopharm Taiyuan Property Executive
Jiang Xiuchang 2017-12-01
Management Co., Ltd Director
Lian Wanyong China National Medicines Corporation Ltd Director 2017-12-01
China National Zhongjin (Shanghai)
Lian Wanyong Medical Health Investment Management Director 2018-07-01
Co., Ltd
Lian Wanyong West China Dental Co., Ltd Director 2019-01-01
Lian Wanyong Sinopharm Holding Anhui Co., Ltd. President 2019-01-01
Lian Wanyong Sinopharm Holding Changsha Co., Ltd. President 2019-06-01
Lian Wanyong Sinopharm Holding Hubei Co., Ltd. President 2020-01-01
Lian Wanyong Sinopharm Holding Hunan Co., Ltd. Director 2020-03-01
Wu Yijian China National Shanxi Co., Ltd President 2019-03-01
99
Wu Yijian Sinopharm Holding Shanxi Co., ltd President 2019-03-01
Sinopharm Holding Inner Mongolia Co.,
Wu Yijian President 2019-03-01
Ltd.
China National Zhongjin (Shanghai)
Wu Yijian Medical Health Investment Management Director 2019-03-01
Co., Ltd
Wu Yijian China National Health Online Co., Ltd. President 2020-05-01
Wu Yijian Sinopharm Holding Group H.K. Co., Ltd. Director, GM 2020-10-01
Punishment of securities regulatory authority in recent three years to the company’s current and outgoing directors, supervisors and
senior management during the reporting period
□ Applicable √ Not applicable
IV. Remuneration for directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
(i) Remuneration decision procedure of directors, supervisors, senior management:
The Company implemented the annual salary system for senior executives based on the 2020 annual performance
appraisal (scheme) on management staff, paid annual salary remuneration according to the appraisal results.
Remuneration and appraisal committee of the company's board of directors is responsible for the formulation and
examination of salary plan and program as well as formulation and examination of salary plan and assessment
standards of directors (not including the independent directors), supervisors and senior executives. They also
evaluate the performance assessment of directors, supervisors and senior officers in accordance with the
assessment criteria, compensation scheme.
(ii) Remuneration determining basis
The main principles of making standard of compensation are: (1) the company's overall business and the profit
level; (2) the overall salary level and dynamic index over past years; (3) difference in position and duty; (4)
relative importance and risks of position; (5) related post salary level in the same industry; (6) individual
professional ability.
(iii) Actual payment
Executives get monthly basic salary and annual salary after the issuance of annual examination.
Remuneration for directors, supervisors and senior executives in reporting period
In 10 thousand Yuan
Total Received
Post-holding
Name Title Sex (F/M) Age remuneration remuneration
status
before tax from related party
100
obtained from the of the Company
Company (Y/N)
Currently in
Liu Yong President M 51 0Y
office
Ma Zhanjun Deputy Chairman M 60 Office leaving 145.83 Y
Li Zhiming Director M 57 Office leaving 0Y
Currently in
Jiang Xiuchang Director M 56 0Y
office
Currently in
Lian Wanyong Director M 50 0Y
office
Li Dongjiu Director M 55 Office leaving 0Y
Currently in
Wu Yijian Director M 50 0Y
office
Currently in
Lin Zhaoxiong Director, GM M 53 250 N
office
Director, Party
Currently in
Lin Min Secretary, Deputy M 56 225 N
office
GM
Independent Currently in
Chen Honghui M 49 12 N
director office
Independent Currently in
Ou Yongliang M 51 12 N
director office
Independent Currently in
Chen Shengqun M 58 12 N
director office
Independent Currently in
Su Weiwei F 61 12 N
director office
Chairman of
Currently in
Wen Deyong supervisory M 49 0Y
office
committee
Currently in
Liu Jingyun Supervisor F 44 0Y
office
Currently in
Chen Guojing Staff supervisor F 50 78.65 N
office
Currently in
Zhao Xiaochuan Deputy GM M 57 200 N
office
Currently in
Liu Tianrao Deputy GM M 41 175 N
office
Currently in
Lin Xinyang Deputy GM M 56 175 N
office
101
Deputy party
secretary,
Secretary of
Currently in
Lang Baochun committee for M 57 175 N
office
discipline
inspection,
General counsel
Currently in
Gu Guolin CFO M 45 87.5 N
office
Wei PingXiao CFO M 57 Office leaving 72.92 N
Deputy GM,
Currently in
Chen Changbin Secretary of the M 53 150 N
office
Board
Total -- -- -- -- 1,782.90 --
Delegated equity incentive for directors and senior executives in reporting period
□ Applicable √ Not applicable
V. Particulars of workforce
1. Number of staff, professional composition and education background
The number of current employees of parent company (people) 119
The number of current employees of main subsidiaries (people) 38,170
Total number of current employees (people) 38,289
The total number of employees in payroll (people) 38,289
The total number of retired staff and workers that the parent
1,694
company and main subsidiaries need to bear the costs (people)
Professional composition
Category of professional composition Number of professional composition (people)
Production staff 28
Salesman 28,684
Technical staff 248
Financial staff 736
Administrative staff 170
Other 8,423
Total 38,289
Education background
Category of education Number (people)
102
Post-graduate qualification and above 163
Undergraduate 4,789
Junior college 12,757
College degree 20,580
Total 38,289
2. Remuneration policy
Sinopharm Accord and the subordinate enterprises provide perfect compensation and benefits for the staff, the
compensation level is closely combined with organization (total amount of labor, compensation strategy, job
value), staff (capacity development, performance results), and market (market level, talent competition). The
company adjusts the remuneration for staff having abilities and contributions every year by the responsibility
sorting, position evaluation, target remuneration range positioning, and the staff annual work performance and
ability assessment; at the same time, performance bonuses and performance closely link together, and realize
win-win of the interests of company and the interests of employees. Pay attention to the income growth
requirements of low-income groups, develop annual wage growth program, and implement after the deliberation
and approval of the workers' congress.
3. Training programs
Sinopharm Accord and its subordinate companies attach great importance to building learning organizations,
invest training resources every year to train and develop employees at all levels. In 2020, talent development and
training work are based on the main line of empowering operations, strengthening the function of tow depths
(going deep into the front line and going deep into the scene), and constantly improve the company’s training and
cultivating system.
1. Optimize the training management system, revise the training system management system, the employee
training management system, the internal trainer management system, the employee continuing education
management system, the intern management system, the internal lecturer management system, optimize internal
trainers management process, annual training needs and plan management process, and training implementation
process.
2. The headquarters, operation headquarters, and key subsidiaries all set up full-time training posts to assist
managers at all levels to carry out employee training. The company has promoted a three-level training model
throughout the company, and conducted outstanding learning organizations, learning projects, excellent internal
trainers, and excellent training managers on Teachers’ Day.
3. Vigorously promote online training, more than 4,000 accounts have been opened on the "Sinopharm
103
University" platform, covering various subsidiaries across the country, the average online learning hours for all
employees have exceed 30 hours. Among them, live broadcast training methods were vigorously promoted in
2020, and 33,000+ person-times have been organized to take part in live broadcast training, which increased the
influence and coverage of training.
4. The types of training include training for new recruits, vocational training for employees, leadership training for
managers, and internal trainer training. Courses include management courses, general quality courses, and
vocational skills classes.
5. As of the end of 2020, the training expenses of the headquarters and distribution operation headquarters of
Sinopharm Accord and the headquarters of Guoda Drugstore were about 2 million yuan, and the per capital period
reached more than 50 hours.
4. Labor outsourcing
√ Applicable □ Not applicable
Total number of working hours of labor outsourcing (Hour) 1,787,328
Total remuneration paid of labor outsourcing (RMB) 55,870,488.31
104
Section X. Corporate Governance
I. Corporate governance of the Company
During the reporting period, the company strictly followed the requirements of the Company Law, Securities Law,
Government Guidelines for Listed Companies and the relevant laws and regulations of the China Securities
Regulatory Commission and Shenzhen Stock Exchange, continuously improved the company’s corporate
governance structure, and established and improved the company’s internal control. The general meeting of
shareholders, the board of directors and the board of supervisors have standardized operations, independent
directors and special committees of the board of directors have performed their respective duties, continuously
strengthened company management, controlled and prevented risks, standardized company operations, and
improved operational efficiency. The company gradually formed a governance mechanism with clear powers and
responsibilities, standardized operations, mutual coordination, and mutual checks and balances among power
institutions, decision-making institutions, supervisory institutions, and managers.
During the reporting period, the company strengthened internal coordination and communication, revised and
improved internal control related systems, and sorted out various work processes, and further improved the
company’s management quality and operational efficiency. At the same time, it continuously strengthened the
management of inside information, further improved the process systems of inside information management,
strengthened the disclosure of information, improved the management of investor relations, strengthened and
improved the management of affiliated companies, so that the company’s standard operation level has been further
improved. In the future, the company will continue to strictly implement the specific requirements of the
regulatory agencies, strengthen the implementation, improve the evaluation mechanism, and improve the
corporate governance structure, at the same time, strengthen supervision, and strive to promote governance to a
higher level.
Is there any difference between the actual condition of corporate governance and relevant regulations about corporate governance for
listed company from CSRC?
□Yes √ No
There are no differences between the actual condition of corporate governance and relevant regulations about corporate governance
for listed company from CSRC.
II. Independence of the Company relative to controlling shareholders’ in aspect of businesses, personnel,
assets, organization and finance
The Company totally separates from the controlling shareholders in business, personnel, assets, institutions,
financial and other aspects, with independent and complete self-management ability.
105
1. The business: the Company was independent from controlling shareholders, having a complete business system
and self-managing ability; the company has independent procurement and sales system thus all procurement and
sales of drugs and raw materials is in charge of the purchasing department and subordinate subsidiary, branch and
production enterprises; production, supply, marketing and R & D separate from each other; the Company is a legal
market person with independent operation.
2. Personnel: procedures of the controlling shareholder nominating directors and general and deputy general
manager are legal; no intervene on the appointment and removal of personnel made by the board of directors and
shareholders’ meeting happened; the Company set up independent human resource department, responsible for
assessment, training and salary review on staff, making rules and regulations and handbook the employees should
abide by. Labor, personnel, wages and pension, medical insurance and other insurance are independently
managed.
3. Institution: production and operation mechanism and administrative management is completely independent
from the controlling shareholder or actual controller; offices and sites of business operation separate from the
controlling shareholder; the Company established corporate governance structure where the board of directors,
board of supervisors and managers carry out their duties and exercise their respective duties in accordance with
relevant provisions of the articles of association.
4. Asset: property and rights relationship between the Company and the controlling shareholder is clear, with
independent operations; the company has independent production system, auxiliary production system and
supporting system; industrial property rights, trademarks, non-patented technology and other intangible assets
owned by the Company and its subsidiary.
5. Financial aspects: the Company established independent financial departments and independent financial
accounting system; the Company opened a bank account independently; the financial staff is independent without
taking part-time and receiving remuneration in the controlling shareholder; the Company pays tax independently.
III. Horizontal competition
√ Applicable □ Not applicable
Name of controlling Nature of controlling Work schedule and
Type Reason Solution measure
shareholder shareholder follow-up plan
Distribution In December 2016, Normally
subsidiary of Sinopharm Holding implementing,
Horizontal
Sinopharm Holding SASAC Sinopharm Holding issued a commitment Sinopharm Accord
competition
established some letter of avoiding will also actively
social retail horizontal urge the controlling
106
pharmacy, which competition with shareholder to fulfill
might have Sinopharm Accord, their commitments
horizontal and promise to solve
competition with the the horizontal
Guoda Drugstore, competition in
the subordinate respect of
enterprise of the pharmaceutical retail
listed company after business in an
restructuring appropriate way
within five years
since the date when
reorganization
completed
In December 2016,
SINOPHARM
Distribution issued a commitment
subsidiary of letter of avoiding
SINOPHARM horizontal
established some competition with
Normally
social retail Sinopharm Accord,
implementing,
pharmacy, which and promise to solve
Sinopharm Accord
Horizontal might have the horizontal
SINOPHARM SASAC will also actively
competition horizontal competition in
urge the controlling
competition with the respect of
shareholder to fulfill
Guoda Drugstore, pharmaceutical retail
their commitments
the subordinate business in an
enterprise of the appropriate way
listed company after within five years
restructuring since the date when
reorganization
completed
IV. AGM (Annual General Meeting) and extraordinary shareholders’ general meeting held in
the Period
1. AGM
Ratio of investor
Session of meeting Type Date Date of disclosure Index of disclosure
participation
Juchao
Website—(http://ww
Annual General
AGM 66.62% 2020-05-15 2020-05-16 w.cninfo.com.cn)
Meeting of 2019
“Notice of
Resolution of AGM
107
of 2019” No.:
2020-17
Juchao
Website—(http://ww
w.cninfo.com.cn)
First extraordinary
Extraordinary “Notice of
general meeting of 63.17% 2020-11-13 2020-11-14
general meeting Resolution of First
2020
extraordinary
general meeting of
2020” No.: 2020-38
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
V. Responsibility performance of independent directors
1. The attending of independent directors to Board meetings and shareholders general meeting
The attending of independent directors to Board Meeting & shareholders general meeting
Times of Absent the Times
Times of
Board meeting Times of Meeting for attending the
Times of attending by Times of
Independent
supposed to entrusted the second shareholders
director Presence communicatio Absence
attend in the presence time in a row general
n
report period (Y/N) meeting
Chen Honghui 8 3 5 0 0 N 1
Ou Yongliang 8 3 5 0 0 N 1
Su Weiwei 8 3 5 0 0 N 1
Chen Shengqun 8 3 5 0 0 N 1
Explanation of absent the Board Meeting for the second time in a row
2. Objection for relevant events from independent directors
Independent directors come up with objection about Company’s relevant matters
□Yes √No
Independent directors have no objections for relevant events in reporting period
108
3. Other explanation about responsibility performance of independent directors
The opinions from independent directors have been adopted
√ Yes □ No
Explanation on advice that accepted/not accepted from independent directors
During the reporting period, the independent directors performed their duties in a careful, diligent, dedicated
attitude in accordance with requirements of the "Working System of Independent Director", offered some useful
suggestions and opinions on business decision-making, legal affairs, financial management and other aspects;
carefully examined important matters those needed opinions of independent directors, made independent
judgments and issued a written independent opinion on major related transactions, daily related transactions,
accountancy hiring and other matters, playing a positive role in safeguarding the legitimate rights and interests of
small shareholders. Besides, independent directors played an important role in operation of special committee. At
the same time, the Company can guarantee independent directors and other directors of the same right to know.
During the reporting period, the independent directors have no objection on the related issues of the Company.
VI. Duty performance of the special committees under the board during the reporting period
(i) Duties fulfillment of the board of directors and audit committee on internal control over risk
Internal control on risk and Audit Committee of the board of directors of the company comprises 4 independent
directors and 4 directors, including the convener Chen Shengqun - an independent director(professional
accountant). In accordance with relevant provisions of China Securities Regulatory Commission and Shenzhen
Stock Exchange and working system, Internal control on risk and Audit Committee of the board of directors
seriously performed duties in a dedicated attitude. In the annual financial report audit, they acted as supervisors,
maintained individuality of audit and issued a series of notices such as the Written Opinion on Financial
Accounting Statements Issued by the Company before CPA of Annual Examination Entered, the Written Opinion
on Financial Accounting Statements after Preliminary Audit Issued by CPA of Annual Examination, the Summary
Report of Internal Risk Control and Audit Committee on the Annual Audit Work of CPA as well as the Resolution
on Rehire the Audit Institution. Its main duties comprise the following:
1. Risk internal control and audit committee is responsible for determining the audit work schedule, negotiating
with CPA who engages in audit;
2. Before CPA enters, audit committee should review the financial statements prepared by the Company and issue
written opinions;
3. Strengthen communication with the CPA, and urge them to submit audit report within stipulated time with
urgency letter;
4. Review again the financial statements after the CPA issues preliminary opinion, and issue written opinions;
5. The Committee held annual work conference 2020, approved proposal of financial accounting report, summary
report of annual audit work of CPA and rehiring Ernst & Young CPA (Special General Partnership) as the audit
109
institution, and then formed a resolution to submit to board of directors for approval.
(ii) Duties fulfillment of Remuneration and Appraisal Committee
As special working mechanism of the board of directors, the remuneration and appraisal committee are
responsible for approving the assessment standard of directors and senior executives, formulating and reviewing
compensation policies and programs of directors and executive. And they take charge in examining according to
the standard and policies. The remuneration and appraisal committee is composed of 4 independent directors and
3 directors; convener is Chen Honghui, an independent director.
During the reporting period, remuneration and assessment committee actively performed duty; clearly defined
their responsibilities; did serious research and appraisal on the remuneration and appraisal system, especially
salary, assessment system and program over directors, supervisors and senior executive. According to working
rules of the remuneration and appraisal committee, they have rights to check regular reports, meetings records,
business planning and other materials by telephone, interviews and other methods to learn the performance of
directors, executives. And they’re required to submit problems existing in implementation of system to the Board
of Directors and raise up suggestion on them. Their contents are as follows:
1. In 2020, the remuneration and appraisal committee carried out the performance evaluation of executives
according to the 2019 Annual operation standard and performance.
2. It proposed the "2021 Evaluation Scheme of Operating Performance", and submitted it to the board of directors
for approval.
3. The remuneration and appraisal committee approved salary of directors, supervisors and senior executives
disclosed in 2020 annual report. And it issued the following opinions:
Compensation decision procedures of directors, supervisors and senior management personnel was in accordance
with the provisions; the standard was in accordance with the remuneration system; the disclosure of 2020 annual
report about personnel salary of the directors, supervisors and senior management is real and accurate.
VII. Works from Supervisory Committee
The Company has risks in reporting period that found in supervisory activity from supervisory committee
□ Yes √ No
Supervisory committee has no objection about supervision events in reporting period
VIII. Examination and incentives of senior management
Senior executives of the Company took responsibility for the board of directors, in the reporting period, the board
of directors implemented the performance checking mechanism that the remuneration of senior executives related
110
with their performance checking, with achievement as direction, and made relevant reward and punishment
according to target completion. The Company’s relevant incentive and restriction mechanism gradually in order to
further exert the enthusiasm and creativity of senior executives, urge the senior executives to perform the
obligations of being honest and diligent. The Company had no incentive mechanism for senior executives such as
stock option, purchase of management team and equity held by owner.
IX. Internal Control
1. Details of major defects in IC appraisal report that found in reporting period
□Yes √ No
2. Appraisal Report of Internal Control
Disclosure date of full internal control
2 April 2021
evaluation report
Disclosure index of full internal control “Self-evaluation report of internal control for 2020” in Juchao website
evaluation report (www.cninfo.com.cn) appointed by Shenzhen Stock Exchange
The ratio of the total assets of units
included in the scope of evaluation
accounting for the total assets on the 100.00%
company's consolidated financial
statements
The ratio of the operating income of
units included in the scope of evaluation
accounting for the operating income on 100.00%
the company's consolidated financial
statements
Defects Evaluation Standards
Category Financial Reports Non-financial Reports
Financial report defects are mainly judged Non-financial report defects are
and decided by the degree of influence and mainly judged and decided by the
the likelihood of occurrence to the degree of influence and the likelihood
misstatements of financial reports caused of occurrence of defects to the validity
by defects. of business process.
(1) Significant defects: a combination of (1) Significant defects: a combination
one or multiple internal control defects of one or multiple internal control
Qualitative criteria
that exists in internal control and may defects that may cause the enterprise’s
cause the material misstatements in serious deviation to internal control
financial statements cannot be prevented, objectives;
found or corrected in time; (2) Major defects: a combination of
(2) Major defects: a combination of one or one or multiple internal control defects
multiple internal control defects that exists whose severity level and economic
in internal control and has lower severity consequences are lower than
111
level than significant defects but still significant defects but still may cause
should be concerned by the the enterprise’s deviation to internal
superintendents of enterprise financial control objectives;
reports; (3) Common defects: other defects
(3) Common defects: other defects except except for significant and major
for significant and major defects. defects.
A quantitative criterion determines the
degree of importance of the company’s
defects based on the amount of direct
loss and the degree of significant
influence to the company.
(1) Significant defects: the amount of
direct property loss is or more than 10
million Yuan, or has been officially
A quantitative criterion determines the disclosed and caused negative effects
degree of importance of misstatements to periodic report disclosure of the
(including missing reports) in the joint-stock companies;
consolidated statements of listed (2) Major defects: the amount of direct
companies based on the consolidated property loss is between 5 million and
statement data. 10 million Yuan, or has been punished
Quantitative standard
(1) Significant defects: equal to or greater by the national government
than 5% of profit before tax; departments but has not caused
(2) Major defects: Between 1% and 5% of negative effects to periodic report
profit before tax; disclosure of the joint-stock
(3) Common defects: Less than or equal to companies;
1% of profit before tax (3) Common defects: the amount of
direct property loss is between 0.1
million and 5 million Yuan, or has
been punished by the provincial or
sub-provincial government
departments but has not caused
negative effects to periodic report
disclosure of the joint-stock
companies.
Amount of significant defects in
0
financial reports
Amount of significant defects in
0
non-financial reports
Amount of important defects in financial
0
reports
Amount of important defects in
0
non-financial reports
112
X. Auditing report of internal control
√ Applicable □ Not applicable
Deliberations in Audit Report of Internal Control
According to relevant regulations and “Basic Rules of Internal Control for Enterprises”, China National Accord Medicines
Corporation Ltd. in all major aspects, keeps an efficiency of internal control of financial report dated 31 December 2020
Disclosure details of audit report of
Disclosed
internal control
Disclosure date of audit report of
2 April 2021
internal control (full-text)
Index of audit report of internal Audit Report of Internal Control under the name of China National Accord Medicines
control (full-text) Corporation Ltd. released on Juchao Website (http://www.cninfo.com.cn)
Opinion type of auditing report of
Standard unqualified
IC
Whether the non-financial report
No
had major defects
Carried out modified opinion for internal control audit report from CPA
□Yes √ No
The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued from the Board
√ Yes □ No
113
Section XI. Corporate Bond
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and without due on the date when
annual report approved for released or fail to cash in full on due
No
114
Section XII. Financial Report
115
AUDITOR’S REPORT
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
To the shareholders of China National Accord Medicines Corporation Ltd.
(I) Opinion
We have audited the financial statements of China National Accord Medicines Corporation Ltd. (the
“Company”), which comprise the consolidated and the Company’s balance sheets as at 31 December 2020,
and the consolidated and the Company’s income statements, the consolidated and the Company’s statements
of changes in equity and the consolidated and the Company’s statements of cash flows for the year then ended,
and notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated
and the Company’s financial position as at 31 December 2020, and the consolidated and the Company’s
financial performance and cash flows for the year then ended in accordance with Accounting Standards for
Business Enterprises (“ASBEs”).
(II) Basis for opinion
We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial statements
section of our report. We are independent of the Company in accordance with China Code of Ethics for
Certified Public Accountants (the “Code”), and we have fulfilled our other ethical responsibilities in accordance
with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
(III) Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current period. These matters were addressed in the context of our audit of
the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter is
provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial
statements section of our report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement of the
financial statements. The results of our audit procedures, including the procedures performed to address the
matters below, provide the basis for our audit opinion on the accompanying financial statements.
116
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
(III) Key audit matters (continued)
Key audit matter How our audit addressed the key audit
matter
Impairment of goodwill
The carrying value of goodwill amounted to The procedures performed to address this matter are
RMB2.747 billion as at 31 December 2020 and was as follows:
allocated to the Company’s asset groups of
pharmaceutical distribution and pharmaceutical 1) Performing walk-through testing in the process
retail. related to goodwill and control testing on identified
key control points;
Under ASBEs, the management of the Company is
required to perform the impairment test for goodwill 2) Inviting internal evaluation experts to assist in
annually. The impairment test is based on the evaluating the goodwill impairment method and
recoverable amount of the respective asset groups to forecasted key parameters adopted by
which the goodwill is allocated. The recoverable management used in the impairment test,
amount of the asset groups is determined according especially the discount rate and perpetual growth
to the present value of the asset groups' expected rate;
future cash flows. As the impairment test process of
goodwill involves significant judgment of the 3) Re-examining the sales revenue and operating
management, the test results highly depend on the results of the future years adopted in the cash flow
management's estimates and assumptions, such as forecast, comparing with the historical operating
the estimation of the forecasted future cash flows results of the related asset groups, especially the
and the discount rate of the asset groups. These future sales growth rate, expected gross profit
estimates are affected by the management's margin, related expenses, etc., and evaluating the
judgment on the future market and economic analyses made by the management on the impact
environment. Using different estimates and of the COVID-19 epidemic;
assumptions will significantly impact the recoverable
value of the asset groups in which the goodwill is 4) Performing sensitivity testing and analysing on key
located. Therefore, this matter was important to our assumptions used in impairment testing; and
audit, and we determined it as a key audit matter.
5) Re-examining the sufficiency of management's
The Company’s disclosures about impairment of disclosure regarding goodwill.
goodwill are included in Note III (17. Impairment of
assets, 33. Significant accounting judgements and
estimates) and Note V (18. Goodwill) to the
consolidated financial statements.
117
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
(III) Key audit matters (continued)
Key audit matter How our audit addressed the key audit
matter
Impairment of accounts receivable
Major clients of the Company are medical The procedures performed to address this matter are
establishments, pharmacy chain stores, monomer as follows:
drugstores, community medical service centres,
downstream distribution companies, etc. As at 31 1) Realising and testing management’s internal
December 2020, the book balance of accounts control that relates to the impairment of accounts
receivable in the consolidated financial statements of receivable;
the Company was RMB13.892 billion, and the
impairment of accounts receivable was RMB93 2) Re-examining and evaluating the "Expected Credit
million. Loss Model" used by the management to estimate
bad debts of accounts receivable, including the
The management classifies the accounts receivable management's division of different combinations of
into different combinations of credit risk credit risk characteristics of accounts receivable,
characteristics while considering the factors such as the estimation of the expected credit loss on
the customer type, credit period and collection accounts receivable for combinations of credit risk
history. For each category of combinations of credit characteristics, and historical as well as other
risk characteristics, the management adopts the forward-looking information used in the estimation.
expected credit loss model to estimate and make Re-examined the management's assessment of
provision for bad debts. Management's estimation of the impact of COVID-19 epidemic on the credit risk
the expected credit loss takes into account all of customers;
reasonable and evidence-based information,
including the customer's historical default rate and 3) Discussing with the management regarding the
other specific factors (such as the customer type, recoverability of individually significant accounts
collection history and bad debt write-offs, etc.), as receivable or long-aged accounts receivable and
well as forward-looking information in combination evaluating the adequacy of provision for bad debts;
with factors such as the expected macroeconomic and
environment, etc. In the meantime, the management
pays attention to the collection of accounts 4) Re-examining the sufficiency of the management’s
receivable, especially individually significant disclosure related to accounts receivable.
accounts receivable or long-aged accounts
receivable to identify additional signs of default or
impairment and determine whether additional bad
debt provision is required.
118
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
(III) Key audit matters (continued)
Key audit matter How our audit addressed the key audit
matter
Impairment of accounts receivable (Continued)
The classification of different categories of
combinations of credit risk characteristics and the
estimation of the expected credit loss rate of
accounts receivable, etc., involve significant
management’s judgment and estimation, with great
estimation uncertainty, and the setting of various
parameters needs to be based on the statistics and
analysis of the relatively complex historical data.
Therefore, this matter was important to our audit, and
we determined it as a key audit matter.
The Company’s disclosures about impairment of
accounts receivable are included in Note III (8.
Financial instruments, 33. Significant accounting
judgements and estimates) and Note V (3. Accounts
receivable) to the consolidated financial statements.
119
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
(IV) Other information
The management of the Company is responsible for the other information. The other information comprises the
information included in the annual report, other than the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form
of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
(V) Responsibilities of the management and those charged with governance for the financial
statements
The management of the Company is responsible for the preparation and fair presentation of the financial
statements in accordance with ASBEs, and for designing, implementing and maintaining such internal control
as the management determines is necessary to enable the preparation of financial statements to be free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting, unless management either intends to liquidate the Company or to cease
operations or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
120
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
(VI) Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with CSAs will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are generally considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with CSAs, we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the management.
(4) Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the
related disclosures in the financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in a
manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Company to express an opinion on the financial statements. We are responsible for
the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.
121
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2021) Shen Zi No. 61295118_H01
China National Accord Medicines Corporation Ltd.
(VI) Auditor’s responsibilities for the audit of the financial statements (continued)
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
Ernst & Young Hua Ming LLP Chinese Certified Public Accountant: Li Jian Guang
(Engagement partner)
Chinese Certified Public Accountant: Li Yuan Fen
Beijing, the People’s Republic of China 31 March 2021
Important Notice
This auditor’s report is an English translation of the auditor’s report for the audit engagements which adopt CSAs. In
case the English version does not conform to the Chinese version, the Chinese version prevails.
122
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET
31 December 2020 Expressed in Renminbi Yuan
ASSETS Note V 31 December 2020 31 December 2019
Current assets
Cash and bank balances 1 5,998,204,295.87 8,885,729,250.47
Notes receivable 2 622,115,477.04 793,301,688.64
Accounts receivable 3 13,799,971,014.22 10,712,983,544.18
Receivables financing 4 1,404,987,700.38 446,342,588.46
Advances to suppliers 5 480,313,574.71 389,828,785.54
Other receivables 6 535,228,747.69 501,958,841.43
Inventories 7 6,285,010,674.46 5,063,274,143.26
Contract assets 8 15,177,731.64 -
Other current assets 9 121,082,863.45 102,207,498.20
Total current assets 29,262,092,079.46 26,895,626,340.18
Non-current assets
Long-term equity investments 10 2,287,019,627.99 2,105,114,410.88
Other equity instrument investment 11 99,488,340.28 116,021,000.00
Other non-current financial assets 12 120,972,350.24 140,000,000.00
Investment properties 13 127,444,379.94 138,900,358.30
Fixed assets 14 854,191,083.27 708,000,172.63
Construction in progress 15 46,631,190.23 31,582,575.84
Right-of-use assets 16 2,356,952,392.99 1,994,757,862.07
Intangible assets 17 734,345,179.40 374,788,799.48
Goodwill 18 2,747,375,281.11 1,010,057,927.17
Long-term prepaid expenses 19 457,705,276.09 373,527,968.14
Deferred tax assets 20 92,118,767.81 63,110,829.12
Other non-current assets 21 408,197,522.84 77,354,970.39
Total non-current assets 10,332,441,392.19 7,133,216,874.02
Total assets 39,594,533,471.65 34,028,843,214.20
The accompanying notes form an integral part of these financial statements.
123
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET (CONTINUED)
31 December 2020 Expressed in Renminbi Yuan
LIABILITIES AND EQUITY Note V 31 December 2020 31 December 2019
Current liabilities
Short-term borrowings 22 1,612,187,020.12 1,453,018,300.01
Notes payable 23 7,520,165,274.69 5,555,697,557.53
Accounts payable 24 7,697,451,142.50 6,703,967,826.54
Receipts in advance 25 12,352,466.64 544,372.73
Contract liabilities 26 368,600,357.14 302,650,567.97
Employee benefits payable 27 357,212,047.10 259,640,813.10
Tax payable 28 316,867,149.16 253,379,524.34
Other payables 29 1,599,166,881.14 1,822,364,637.62
Non-current liabilities due within one year 30 748,732,059.89 611,917,847.37
Other current liabilities 31 24,787,078.55 749,710.19
Total current liabilities 20,257,521,476.93 16,963,931,157.40
Non-current liabilities
Long-term borrowings 32 31,637,173.89 -
Lease liabilities 33 1,303,054,163.90 1,208,453,029.51
Long-term payables 34 6,938,189.00 800,000.00
Long-term employee benefits payable 35 1,319,000.00 1,433,000.00
Provisions 36 68,808,166.79 -
Deferred income 37 89,843,583.37 88,704,272.88
Deferred tax liabilities 20 205,921,408.66 118,284,962.77
Other non-current liabilities 38 740,862,989.59 73,256,514.93
Total non-current liabilities 2,448,384,675.20 1,490,931,780.09
Total liabilities 22,705,906,152.13 18,454,862,937.49
The accompanying notes form an integral part of these financial statements.
124
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET (CONTINUED)
31 December 2020 Expressed in Renminbi Yuan
LIABILITIES AND EQUITY Note V 31 December 2020 31 December 2019
Equity
Share capital 39 428,126,983.00 428,126,983.00
Capital surplus 40 4,372,504,053.72 4,470,766,959.44
Other comprehensive income 41 38,483,017.72 45,917,342.77
Surplus reserves 42 214,063,491.50 214,063,491.50
Retained earnings 43 8,895,145,106.39 7,752,265,659.17
Total equity attributable to owners of
the parent 13,948,322,652.33 12,911,140,435.88
Non-controlling interests 2,940,304,667.19 2,662,839,840.83
Total equity 16,888,627,319.52 15,573,980,276.71
Total liabilities and equity 39,594,533,471.65 34,028,843,214.20
The financial statements have been signed by:
Legal representative: Financial controller: Head of Accounting Department:
The accompanying notes form an integral part of these financial statements.
125
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED INCOME STATEMENT
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note V 2020 2019
Operating revenue 44 59,649,455,012.03 52,786,807,476.28
Less: Operating costs 44 52,591,767,464.37 46,891,224,305.04
Taxes and surcharges 45 154,631,447.20 137,600,136.96
Selling expenses 46 3,943,134,095.75 3,168,007,835.69
Administrative expenses 47 1,008,178,815.78 871,076,467.62
Finance costs 48 119,855,169.85 126,340,266.54
Including: Interest expense 258,189,163.79 276,490,046.68
Interest income 136,455,990.10 139,860,973.14
Add: Other income 49 72,363,808.19 45,229,118.70
Investment income 50 283,951,956.10 246,185,242.97
Including: Investment income from associates 354,345,705.65 331,171,902.87
Income from the derecognition of financial
assets measured at amortised cost (76,142,835.36) (86,377,492.55)
Credit impairment losses 51 (25,975,320.08) (53,056,200.12)
Impairment losses 52 (5,179,285.75) (3,038,177.68)
Gain on disposal of assets 53 6,791,962.50 2,551,175.02
Operating profits 2,163,841,140.04 1,830,429,623.32
Add: Non-operating income 54 17,660,920.58 25,602,351.62
Less: Non-operating expenses 55 24,265,611.84 4,575,796.92
Total profit 2,157,236,448.78 1,851,456,178.02
Less: Income tax expenses 56 435,940,050.06 371,296,724.78
Net profit 1,721,296,398.72 1,480,159,453.24
Including: Net profit before business combination of the acquiree
under common control - -
Net profit classified by continuing operations
Profit or loss from continuing operations 1,721,296,398.72 1,480,159,453.24
Net profit classified by attribution of ownership
Net profit attributable to owners of the parent 1,401,892,593.23 1,267,931,291.32
Non-controlling interests 319,403,805.49 212,228,161.92
Other comprehensive income, net of tax (12,394,161.92) 76,618,063.81
Other comprehensive income, net of tax, attributable to owners of the
parent, 41 (7,434,325.05) 45,917,342.77
Other comprehensive income that will not be reclassified to profit or
loss
Change in the fair value of other equity investments (7,439,657.92) 46,050,708.96
Other comprehensive income that may be reclassified to profit or loss
Other comprehensive income using the equity method that may
be reclassified to profit or loss 5,332.87 (133,366.19)
Other comprehensive income, net of tax, attributable to non-controlling
interests 41 (4,959,836.87) 30,700,721.04
The accompanying notes form an integral part of these financial statements.
126
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED INCOME STATEMENT (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note V 2020 2019
Total comprehensive income 1,708,902,236.80 1,556,777,517.05
Including:
Total comprehensive income attributable to owners of the 1,394,458,268.18 1,313,848,634.09
parent
Total comprehensive income attributable to non-controlling
314,443,968.62 242,928,882.96
interests
Earnings per share 59
Basic earnings per share 3.27 2.96
Diluted earnings per share 3.27 2.96
The accompanying notes form an integral part of these financial statements.
127
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Year ended 31 December 2020 Expressed in Renminbi Yuan
Attributable to owners of the parent
2020 Other
comprehensive Non-controlling
Share capital Capital surplus income Surplus reserves Retained earnings Subtotal interests Total equity
I. Balance at end of prior year 428,126,983.00 4,363,007,511.57 45,917,342.77 214,063,491.50 7,755,295,537.08 12,806,410,865.92 2,553,426,974.31 15,359,837,840.23
Add: Business combination involving
entities under common control - 107,759,447.87 - - (3,029,877.91) 104,729,569.96 109,412,866.52 214,142,436.48
II. Balance at beginning of year 428,126,983.00 4,470,766,959.44 45,917,342.77 214,063,491.50 7,752,265,659.17 12,911,140,435.88 2,662,839,840.83 15,573,980,276.71
III. Changes for the year - (98,262,905.72) (7,434,325.05) - 1,142,879,447.22 1,037,182,216.45 277,464,826.36 1,314,647,042.81
(1) Total comprehensive income - - (7,434,325.05) - 1,401,892,593.23 1,394,458,268.18 314,443,968.62 1,708,902,236.80
(2) Owners’ contributions and
reduction in capital - (98,262,905.72) - - (2,136,956.21) (100,399,861.93) 28,361,747.23 (72,038,114.70)
1. Capital contributions by owners - - - - - - 5,700,000.00 5,700,000.00
2. Business combination involving
entities under common control - (97,869,029.99) - - - (97,869,029.99) (65,246,019.99) (163,115,049.98)
3. Business combination involving
entities not under common control - - - - - - 87,907,767.22 87,907,767.22
4. Others - (393,875.73) - - (2,136,956.21) (2,530,831.94) - (2,530,831.94)
(3) Profit distribution - - - - (256,876,189.80) (256,876,189.80) (65,340,889.49) (322,217,079.29)
1.Distribution to equity owners - - - - (256,876,189.80) (256,876,189.80) (65,340,889.49) (322,217,079.29)
IV. Balance at end of year 428,126,983.00 4,372,504,053.72 38,483,017.72 214,063,491.50 8,895,145,106.39 13,948,322,652.33 2,940,304,667.19 16,888,627,319.52
The accompanying notes form an integral part of these financial statements.
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
Attributable to owners of the parent
2019 Other
comprehensive Non-controlling
Share capital Capital surplus income Surplus reserves Retained earnings Subtotal interests Total equity
I. Balance at end of prior 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
Add: Business combination involving
entities under common control - 107,759,447.87 - - 328,013.78 108,087,461.65 110,114,216.72 218,201,678.37
II. Balance at beginning of year 428,126,983.00 4,428,744,429.38 - 214,063,491.50 6,655,585,161.05 11,726,520,064.93 2,397,458,106.49 14,123,978,171.42
III. Changes for the year - 42,022,530.06 45,917,342.77 - 1,096,680,498.12 1,184,620,370.95 265,381,734.34 1,450,002,105.29
(1) Total comprehensive income - - 45,917,342.77 - 1,267,931,291.32 1,313,848,634.09 242,928,882.96 1,556,777,517.05
(2) Owners’ contributions and
reduction in capital
- 42,022,530.06 - - - 42,022,530.06 62,799,658.33 104,822,188.39
1. Capital contributions by owners - - - - - - 48,136,000.00 48,136,000.00
2. Others - 42,022,530.06 - - - 42,022,530.06 14,663,658.33 56,686,188.39
(3) Profit distribution
- - - - (171,250,793.20) (171,250,793.20) (40,346,806.95) (211,597,600.15)
1.Distribution to equity owners - - - - (171,250,793.20) (171,250,793.20) (40,346,806.95) (211,597,600.15)
IV. Balance at end of year 428,126,983.00 4,470,766,959.44 45,917,342.77 214,063,491.50 7,752,265,659.17 12,911,140,435.88 2,662,839,840.83 15,573,980,276.71
The accompanying notes form an integral part of these financial statements.
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note V 2020 2019
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the
rendering of services 61,701,348,065.17 56,622,085,083.65
Receipts of taxes and surcharges refunds 13,720,143.80 14,595,925.20
Other cash receipts relating to operating activities 60 1,697,383,795.18 769,560,639.30
Total cash inflows from operating activities 63,412,452,004.15 57,406,241,648.15
Cash payments for goods and services 56,018,201,099.73 50,596,329,425.99
Cash payments to and on behalf of employees 2,708,413,782.73 2,282,454,444.09
Payments of all types of taxes and surcharges 1,512,079,139.15 1,292,447,071.15
Other cash payments relating to operating
activities 60 1,671,011,384.07 1,222,357,517.18
Total cash outflows from operating activities 61,909,705,405.68 55,393,588,458.41
Net cash flows from operating activities 61 1,502,746,598.47 2,012,653,189.74
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash receipts from returns of investments 19,027,649.76 -
Cash receipts from returns on investments 160,164,584.49 151,841,842.08
Net cash receipts from disposal of fixed assets,
intangible assets and other long-term assets 8,570,072.79 5,309,788.13
Net cash receipts from disposal of subsidiaries
and other business units 61 - 791,464.76
Other cash receipts relating to investing activities 60 24,051,674.67 481,988,480.07
Total cash inflows from investing activities 211,813,981.71 639,931,575.04
The accompanying notes form an integral part of these financial statements.
130
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note V 2020 2019
2. CASH FLOWS FROM INVESTING ACTIVITIES (Continued)
Cash payments to acquire fixed assets, intangible assets
and other long-term assets 293,826,061.63 251,856,027.38
Cash payments for investments 50,117,666.41 56,001,023.17
Net cash payments for acquisition of subsidiaries and other
business units 61 2,646,097,210.38 97,801,928.16
Other cash payments relating to investing activities 60 5,002,197.26 455,397,750.74
Total cash outflows from investing activities 2,995,043,135.68 861,056,729.45
Net cash flows from investing activities (2,783,229,153.97) (221,125,154.41)
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash proceeds from investments by others 5,700,000.00 46,093,966.84
Including: Cash receipts from capital contributions from
non-controlling interests of subsidiaries 5,700,000.00 46,093,966.84
Cash receipts from borrowings 801,520,037.57 171,786,182.96
Other cash receipts relating to financing activities 60 359,332,475.63 249,305,768.12
Total cash inflows from financing activities 1,166,552,513.20 467,185,917.92
Cash repayments for debts 427,347,200.00 215,846,808.49
Cash payments for distribution of dividends or profit and
interest expenses 613,704,450.41 532,883,488.76
Including: Dividends or profit paid to non-controlling
shareholders of subsidiaries 63,799,218.94 39,827,223.10
Other cash payments relating to financing activities 60 1,865,923,680.60 718,672,829.88
Total cash outflows from financing activities 2,906,975,331.01 1,467,403,127.13
Net cash flows from financing activities (1,740,422,817.81) (1,000,217,209.21)
4. EFFECT OF FOREIGN EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS (52,538.86) (175,693.26)
5. NET DECREASE / INCREASE IN CASH AND CASH
EQUIVALENTS (3,020,957,912.17) 791,135,132.86
Add: Cash and cash equivalents at beginning of the year 8,426,071,170.16 7,634,936,037.30
6. CASH AND CASH EQUIVALENTS AT END OF YEAR 61 5,405,113,257.99 8,426,071,170.16
The accompanying notes form an integral part of these financial statements.
131
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET
31 December 2020 Expressed in Renminbi Yuan
ASSETS Note XIV 31 December 2020 31 December 2019
Current assets
Cash and bank balances 3,020,909,473.71 2,909,417,289.71
Notes receivable 1 30,984,449.44 14,900,068.42
Accounts receivable 2 609,575,301.13 571,544,784.65
Receivables financing 3 30,248,631.32 30,194,682.11
Advances to suppliers 6,722,204.59 7,996,243.28
Other receivables 4 3,562,309,346.07 1,928,941,595.38
Inventories 172,275,777.63 169,422,075.78
Contract assets 139,154.54 -
Other current assets 39,482.38 39,482.38
Total current assets 7,433,203,820.81 5,632,456,221.71
Non-current assets
Long-term equity investments 5 7,873,668,245.16 7,698,756,525.83
Other non-current financial assets 120,972,350.24 140,000,000.00
Investment properties 1,452,132.04 1,484,198.56
Fixed assets 13,279,902.76 14,763,656.62
Right-of-use assets 5,142,755.88 6,217,504.50
Intangible assets 4,622,268.00 5,838,737.17
Long-term prepaid expenses 4,335,802.92 6,130,534.55
Deferred tax assets 9,025,057.52 9,327,850.53
Other non-current assets 12,967,715.50 9,000,000.00
Total non-current assets 8,045,466,230.02 7,891,519,007.76
Total assets 15,478,670,050.83 13,523,975,229.47
The accompanying notes form an integral part of these financial statements.
132
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET (CONTINUED)
31 December 2020 Expressed in Renminbi Yuan
LIABILITIES AND SHAREHOLDERS’ EQUITY Note XIV 31 December 2020 31 December 2019
Current liabilities
Short-term borrowings 157,892,942.24 121,350,644.36
Notes payable 756,364,719.49 751,577,900.22
Accounts payable 407,275,713.49 322,436,681.01
Contract liabilities 1,807,562.61 7,293,184.46
Employee benefits payable 36,672,344.48 30,469,777.88
Tax payables 13,975,905.04 22,909,124.90
Other payables 3,167,152,583.28 2,120,794,765.05
Non-current liabilities due within one year 1,056,120.58 32,640,325.77
Other current liabilities 636,200.63 338,196.81
Total current liabilities 4,542,834,091.84 3,409,810,600.46
Non-current liabilities
Long-term borrowings 31,637,173.89 -
Lease liabilities 4,455,967.97 5,461,257.38
Long-term payables 800,000.00 800,000.00
Deferred income 827,658.18 1,276,698.66
Other non-current liabilities 11,042.52 -
Total non-current liabilities 37,731,842.56 7,537,956.04
Total liabilities 4,580,565,934.40 3,417,348,556.50
The accompanying notes form an integral part of these financial statements.
133
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET (CONTINUED)
31 December 2020 Expressed in Renminbi Yuan
LIABILITIES AND SHAREHOLDERS’ EQUITY Note XIV 31 December 2020 31 December 2019
Shareholders’ equity
Share capital 428,126,983.00 428,126,983.00
Capital surplus 4,467,991,431.59 4,468,385,307.32
Other comprehensive income (128,033.32) (133,366.19)
Surplus reserves 214,063,491.50 214,063,491.50
Retained earnings 5,788,050,243.66 4,996,184,257.34
Total shareholders’ equity 10,898,104,116.43 10,106,626,672.97
Total liabilities and shareholders’ equity 15,478,670,050.83 13,523,975,229.47
The accompanying notes form an integral part of these financial statements.
134
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY INCOME STATEMENT
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note XIV 2020 2019
Operating revenue 6 3,853,659,001.12 4,108,399,019.34
Less: Operating costs 6 3,674,872,961.34 3,916,035,572.52
Taxes and surcharges 6,565,048.14 6,459,864.79
Selling expenses 67,202,266.56 69,400,890.32
Administrative expenses 90,803,215.82 73,489,681.09
Finance costs (89,275,535.72) (64,025,013.54)
Including: Interest expense 45,645,501.85 46,025,863.16
Including: Interest income 137,302,390.98 111,805,557.75
Add: Other income 4,977,883.40 4,810,134.29
Investment income 7 969,166,523.86 1,158,737,566.83
Including: Investment income from
associates 353,352,207.87 353,856,432.16
Income from the
derecognition of
financial assets
measured at amortised
cost (1,796,917.66) (4,379,465.57)
Credit impairment losses (965,769.74) (45,728,840.12)
Impairment losses (500,485.27) (371,833.95)
Gain on disposal of assets (165.97) 155,014.05
Operating profits 1,076,169,031.26 1,224,640,065.26
Add: Non-operating income 1,925.53 741,954.13
Less: Non-operating expenses 388,863.31 280.00
Total profit 1,075,782,093.48 1,225,381,739.39
Less: Income tax expenses 27,039,917.36 14,503,442.87
Net profit 1,048,742,176.12 1,210,878,296.52
Including: Profit or loss from continuing operations 1,048,742,176.12 1,210,878,296.52
Other comprehensive income, net of tax 5,332.87 (133,366.19)
Other comprehensive income that may be
reclassified to profit or loss
Other comprehensive income using the equity
method that may be reclassified to profit or loss 5,332.87 (133,366.19)
Total comprehensive income 1,048,747,508.99 1,210,744,930.33
The accompanying notes form an integral part of these financial statements.
135
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CHANGES IN EQUITY
Year ended 31 December 2020 Expressed in Renminbi Yuan
Other comprehensive
2020 Share capital Capital surplus Surplus reserves Retained earnings Total equity
income
I. Balance at end of prior year 428,126,983.00 4,468,385,307.32 (133,366.19) 214,063,491.50 4,996,184,257.34 10,106,626,672.97
II. Changes for the year - (393,875.73) 5,332.87 - 791,865,986.32 791,477,443.46
(1) Total comprehensive income - - 5,332.87 - 1,048,742,176.12 1,048,747,508.99
(2) Owners’ contributions and reduction in capital - (393,875.73) - - - (393,875.73)
1. Others - (393,875.73) - - - (393,875.73)
(3) Profit distribution - - - - (256,876,189.80) (256,876,189.80)
1. Distribution to owners - - - - (256,876,189.80) (256,876,189.80)
III. Balance at end of year 428,126,983.00 4,467,991,431.59 (128,033.32) 214,063,491.50 5,788,050,243.66 10,898,104,116.43
The accompanying notes form an integral part of these financial statements.
136
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CHANGES IN EQUITY (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
Other comprehensive
2019 Share capital Capital surplus Surplus reserves Retained earnings Total equity
income
I. Balance at end of prior year 428,126,983.00 4,426,362,777.26 - 214,063,491.50 3,956,556,754.02 9,025,110,005.78
II. Changes for the year - 42,022,530.06 (133,366.19) - 1,039,627,503.32 1,081,516,667.19
(1) Total comprehensive income - - (133,366.19) - 1,210,878,296.52 1,210,744,930.33
(2) Owners’ contributions and reduction in capital - 42,022,530.06 - - - 42,022,530.06
1. Others - 42,022,530.06 - - - 42,022,530.06
(3) Profit distribution - - - - (171,250,793.20) (171,250,793.20)
1. Distribution to owners - - - - (171,250,793.20) (171,250,793.20)
III. Balance at end of year 428,126,983.00 4,468,385,307.32 (133,366.19) 214,063,491.50 4,996,184,257.34 10,106,626,672.97
The accompanying notes form an integral part of these financial statements.
137
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CASH FLOWS
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note XIV 2020 2019
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the
rendering of services 4,009,125,652.17 4,484,950,773.68
Other cash receipts relating to operating activities 152,617,741.86 55,105,150.55
Total cash inflows from operating activities 4,161,743,394.03 4,540,055,924.23
Cash payments for goods and services 3,813,436,197.34 4,272,419,447.94
Cash payments to and on behalf of employees 94,005,053.76 90,592,261.08
Payments of all types of taxes and surcharges 87,642,227.22 56,746,556.88
Other cash payments relating to operating
activities 69,706,005.74 36,680,891.34
Total cash outflows from operating activities 4,064,789,484.06 4,456,439,157.24
Net cash flows from operating activities 96,953,909.97 83,616,766.99
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash receipts from returns of investments 32,664,096.76 -
Cash receipts from returns on investments 753,109,725.64 958,057,018.50
Net cash receipts from disposal of fixed assets,
intangible assets and other long-term assets 20,210.00 3,961,383.00
Other cash receipts relating to investing activities 2,774,679,815.57 2,293,944,952.05
Total cash inflows from investing activities 3,560,473,847.97 3,255,963,353.55
Cash paid for acquisition of fixed assets,
intangible assets and other long-term
assets 13,691,557.76 11,264,989.90
Cash payments for investments - 19,998,000.00
Other cash payments relating to investing
activities 4,372,908,047.02 2,669,650,683.28
Total cash outflows from investing activities 4,386,599,604.78 2,700,913,673.18
Net cash flows from investing activities (826,125,756.81) 555,049,680.37
The accompanying notes form an integral part of these financial statements.
138
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CASH FLOWS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
Note XIV 2020 2019
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash receipts from borrowings 63,864,821.52 10,000,000.00
Other cash receipts relating to financing activities 35,223,164,337.16 26,701,067,083.61
Total cash inflows from financing activities 35,287,029,158.68 26,711,067,083.61
Cash repayments for debts 43,700,000.00 10,000,000.00
Cash payments for distribution of dividends, profit
308,496,896.99 210,404,986.68
or interest expenses
Other cash payments relating to financing 34,079,032,358.66 26,052,473,492.66
activities
Total cash outflows from financing activities 34,431,229,255.65 26,272,878,479.34
Net cash flows from financing activities 855,799,903.03 438,188,604.27
4. EFFECT OF FOREIGN EXCHANGE RATE
CHANGES ON CASH AND CASH (52,538.86) (175,693.26)
EQUIVALENTS
5. NET INCREASE IN CASH AND CASH
126,575,517.33 1,076,679,358.37
EQUIVALENTS
Add: Cash and cash equivalents at beginning of the 2,894,333,956.38 1,817,654,598.01
year
6. CASH AND CASH EQUIVALENTS AT END OF 3,020,909,473.71 2,894,333,956.38
YEAR
The accompanying notes form an integral part of these financial statements.
139
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS
Year ended 31 December 2020 Expressed in Renminbi Yuan
I Profile of the Company
As approved by the People’s Government of Shenzhen (SFBF (1993) No.356), China National
Accord Medicines Corporation Ltd. (hereinafter referred to as the “the Company”), formerly
known as Shenzhen Health 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 RMB105.00 million. Through converting capital surplus into share capital, bonus issues and
issuance of shares for years, the share capital of the Company increased to 428.13 million as at
31 December 2020.
In November 2000, the Company entered into an Asset Exchange Agreement with Shenzhen
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 Shenzhen Investment
Management Company’s 100% equity interests in 11 pharmaceutical companies and certain
properties as well as 51% equity interests in Shenzhen Tefa Modern Computer Co., Ltd. The
above asset exchange proposal was approved by shareholders in the Second Extraordinary
General Meeting on 29 December 2000. The transaction was completed on 8 January 2001.
On 18 February 2004, the Company’s original major shareholder, Shenzhen Investment
Management Company, entered into a stock transfer 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 (ZJGSZ (2004) No.94), the nature of these shares 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
the 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 the Company remained unchanged with corresponding
changes in the composition of shareholdings.
On 14 March 2014, the Company issued 74,482,543 ordinary shares (A shares) through the
non-public offering. The par value per share is RMB1.00 yuan. The shares shall not be
transferred within 36 months since the issue date. The total number of shares of the Company
was 362,631,943 since the date of issue.
The Company acquired the companies under common control, including Sinopharm Holding
Guoda Drugstore Co., Ltd. (“Guoda Drugstore”), Foshan Nanhai Medicine Group Co., Ltd.
(“Foshan Nanhai”), Guangdong South Pharmaceutical Foreign Trade Co., Ltd. (“South Pharma &
Trade”) and Guangdong Dong Fang Uptodate & Special Medicines Co., Ltd. (“Guangdong
Uptodate & Special Medicines”) by issuing shares and raised supporting funds by issuing shares
to Ping An Asset Management Co., Ltd. to acquire the non-controlling interest of South Pharma &
Trade. The above transactions were completed on 31 December 2016, and the relevant shares
were successfully issued and listed on 5 January 2017. Afterwards, the total number of shares of
the Company increased to 428,126,983.
140
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
I Profile of the Company (Continued)
As of 31 December 2020, the total share capital was 428,126,983.
The Company is registered with Shenzhen Administration for Industry & Commerce. 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 RMB428.13 million. 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 wholesale of Chinese herbal slices, traditional Chinese medicine preparations, bulk
pharmaceutical drugs, chemical preparations, bulk antibiotic drugs, antibiotic preparations,
biochemical drugs, biological products (including vaccines and in vitro diagnostic reagents
psychotropic drugs and preparations, narcotic drugs, toxic drugs for medical use, protein
assimilation preparation and peptide hormones; the trading of dietary supplements; industrial
investment holding; domestic trade; material supply and the marketing industry (other than
special licensing); the sale of ambulances; the trading of second-class and third-class medical
equipment; project investment; property management and the leasing of self-owned properties;
pharmacovigilance and medical information consulting; parking operation; logistics and related
services; the package agency business; logistic design; import and export services (excluding
projects that are prohibited by the country; and restrictive projects have to be approved before
operating).
Subsidiaries consolidated in the financial statements for the current year and change in the
consolidation scope are shown in Note VI.
The Group’s parent and ultimate parent companies are Sinopharm Group and China National
Pharmaceutical Group Corporation (“CNPGC”), respectively.
These financial statements were authorised for issue by the board of directors of the Company on
31 March 2021.
II Basis of preparation
The financial statements were prepared in accordance with the Basic Standard and specific
standards of Accounting Standards for Business Enterprises issued by the Ministry of Finance
and the specific accounting standards, application guidance, interpretation and other relevant
regulations issued or amended thereafter (hereafter collectively referred to as “Accounting
Standards for Business Enterprises” or “CAS”).
These financial statements are prepared on a going concern basis.
Except for certain financial instruments, the financial statements have been prepared using the
historical cost as the principle of measurement. Where assets are impaired, provisions for asset
impairment are made in accordance with the relevant requirements.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates
The Group determines the specific accounting policies and estimates based on its features of
production and operation, primarily comprising the methods of provision for expected credit losses
on receivables, valuation of inventories, depreciation of fixed assets and amortisation of intangible
assets, the measurement model of investment properties, recognition and measurement of
revenue, etc.
1. Statement of compliance with Accounting Standards for Business Enterprises
The financial statements present truly and completely the financial positions of the Group and the
Company as at 31 December 2020, and the financial performance and the cash flows for the year
then ended in accordance with Accounting Standards for Business Enterprises.
2. Accounting year
The Group’s accounting year begins on 1 January and ends on 31 December.
3. Functional currency
The functional currency is Renminbi. The Company’s functional and presentation currency is
Renminbi (RMB). The currency unit is RMB Yuan unless otherwise stated.
4. Business combinations
Business combinations are classified into business combinations involving entities under common
control and business combinations not involving entities under common control.
(a) Business combinations involving entities under common control
A business combination involving entities under common control is a business combination in
which all of the combining entities are ultimately controlled by the same party or parties both
before and after the combination, and that control is not transitory. In a business combination
involving entities under common control, the entity that, at the combination date, obtains control of
another combining entity is the absorbing entity, while that other combining entity is the entity
being absorbed. The combination date is the date on which the absorbing entity effectively
obtains control on the entity being absorbed.
Assets and liabilities (including goodwill arising from the ultimate controlling shareholder’s
acquisition of the party being absorbed) that are obtained by the absorbing party in a business
combination 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
4. Business combinations (Continued)
(b) Business combinations involving enterprises not under common control
A business combination not involving entities under common control is a business combination in
which all of the combining entities are not ultimately controlled by the same party or parties both
before and after the combination. In a business combination not involving entities under common
control, the entity that, on the acquisition date, obtains control of another combining entity is the
acquirer, while that other combining entity is the acquiree. The acquisition date is the date on
which the acquirer effectively obtains control of the acquiree.
The acquirer shall measure the acquiree’s identifiable assets, liabilities and contingent liabilities
acquired in the business combination at their fair values on the acquisition date.
Goodwill is initially recognised and measured at cost, being the excess of the aggregate of the fair
value of the consideration transferred (or the fair value of the equity securities issued) and any fair
value of the Group’s previously held equity interest in the acquiree over the Group’s interest in the
fair value of the acquiree’s net identifiable assets. After initial recognition, goodwill is measured at
cost less any accumulated impairment losses. Where the aggregate of the fair value of the
consideration transferred (or the fair value of the equity securities issued) and any fair value of the
Group’s previously held equity interest in the acquiree is lower than the Group’s interest in the fair
value of the acquiree’s net identifiable assets, the Group reassesses the measurement of the fair
value of the acquiree’s identifiable assets, liabilities and contingent liabilities and the fair value of
the consideration transferred (or the fair value of the equity securities issued), together with the fair
value of the Group’s previously held equity interest in the acquiree. If after that reassessment, the
aggregate of the fair value of the consideration transferred (or the fair value of the equity securities
issued) and the Group’s previously held equity interest in the acquiree is still lower than the
Group’s interest in the fair value of the acquiree’s net identifiable assets, the Group recognises the
remaining difference in profit or loss.
Where the business combination not involving enterprises under common control 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 between the fair value and carrying amount
recognised as investment income for the current period. If the acquirer’s previously held equity
interests of the acquiree involve other comprehensive income (“OCI”) under the equity method, the
accounting treatment 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 charged to profit or loss for the current
period on the acquisition date. For financial assets at fair value through OCI held before the
acquisition date, changes in fair value that were accumulated through OCI will transfer to retained
earnings.
5. Consolidated financial statements
The scope of the consolidated financial statements, which include the financial statements of the
Company and all of its subsidiaries, is determined on the basis of control. A subsidiary is an
entity that is controlled by the Company (such as an enterprise, a deemed separate entity, or a
structured entity controlled by the Company).
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
5. Consolidated financial statements (Continued)
In the preparation of the consolidated financial statements, the financial statements of subsidiaries
are prepared for the same accounting year as the Company, using consistent accounting policies.
All intra-group assets and liabilities, equity, income, expenses and cash flows relating to
transactions between members of the Group are eliminated in full on consolidation.
Where the loss for the current period attributable to non-controlling interests of a subsidiary
exceeds the non-controlling interests of the opening balance of equity of the subsidiary, the excess
shall still be allocated against the non-controlling interests.
For subsidiaries acquired through business combinations not involving entities under common
control, the financial performance and cash flows of the acquiree shall be consolidated from the
date on which the Group obtains control, and continue to be consolidated until the date such
control ceases. While preparing the consolidated financial statements, the Group shall adjust the
subsidiary’s financial statements, on the basis of the fair values of the identifiable assets, liabilities
and contingent liabilities recognised on the acquisition date.
For subsidiaries acquired through business combinations involving entities under common control,
the financial performance and cash flows of the entity being absorbed shall be consolidated from
the beginning of the period in which the combination occurs. While preparing the comparative
financial statements, adjustments are made to related items in the financial statements for the prior
period as if the reporting entity after the combination has been in existence since the date the
ultimate controlling party first obtained the control.
The Group reassesses whether or not it controls an investee if any change in facts and
circumstances indicates that there are changes to one or more of the three elements of control.
When the Group loses control of a subsidiary in multiple transactions in which it disposes 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 difference between the consideration received and the corresponding proportion
of the subsidiary’s net assets (calculated continuously from the acquisition date) in each
transaction prior to the loss of control shall be recognised 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 comprises the Group’s cash on hand and bank deposits that can be readily withdrawn on
demand. Cash equivalents are short-term, highly liquid investments that are readily convertible
into known amounts of cash, and are subject to an insignificant risk of changes in value.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
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 translated into
RMB using the spot exchange rates on the balance sheet date. Exchange differences arising from
these translations are recognised in profit or loss for the current period, except for those
attributable to foreign currency borrowings that have been taken out specifically for the acquisition
or construction of qualifying assets, which are capitalised 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.
Foreign currency cash flows are translated using the spot exchange rates prevailing on the dates
of cash flows. The effect of exchange rate changes on cash is presented separately in the cash
flow statement.
8. Financial instruments
Financial instruments are the contracts 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.
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 following conditions is
satisfied:
(1) The contractual rights to the cash flows from the financial asset expire; or
(2) The contractual rights to the cash flows from the financial asset are transferred out, or
obligated to transfer out all generated cash flows on receipt; and (a) substantially all the
risks and rewards of ownership of the financial asset are transferred to the transferee; or (b)
the Group neither transfers nor retains substantially all the risks and rewards of ownership
of the financial asset, but has not retained control of the financial asset.
A financial liability is derecognised when the obligation under the liability is discharged or
cancelled, or expires. When an existing financial liability is replaced by another from the same
lender on substantially different terms, or the terms of an existing liability are substantially modified,
such an exchange or modification is treated as a derecognition of the original liability and a
recognition of a new liability, and the difference between the respective carrying amounts is
recognised in profit or loss.
Regular way purchases and sales of financial assets are recognised and derecognised using trade
date accounting. Regular way purchases or sales are purchases or sales of financial assets that
require delivery within the period generally established by regulation or convention in the
marketplace. The trade date is the date that the Group committed to purchase or sell a financial
asset.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
8. Financial instruments (Continued)
Classification and measurement of financial assets
The classification of financial assets at initial recognition depends on the financial asset’s
contractual cash flow characteristics and the Group’s business model for managing them: financial
assets at fair value through profit or loss, financial assets at amortised 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 fair value at initial recognition, provided that accounts receivable
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; while for other financial assets, the relevant transaction costs are
recognised in their initial recognition amount.
The subsequent measurement of financial assets depends on their classification as follows:
Debt investments measured at amortised cost
The Group measures financial assets at amortised 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 recognised using the
effective interest method. Gains and losses are recognised in the income statement when the
asset is derecognised, modified or impaired.
Debt investments at fair value through other comprehensive income
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 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. Changes in fair values are recognised in other
comprehensive income except that interest income, impairment losses and exchange differences
are recognised in current profit or loss. Upon derecognition, the cumulative fair value change
recognised in other comprehensive income is transferred to profit or loss.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
8. Financial instruments (Continued)
Classification and measurement of financial assets (Continued)
Equity investments at fair value through other comprehensive income
The Group irrevocably chooses to designate some non-tradable equity instrument investments as
financial assets at fair value through other comprehensive income. Only the relevant dividend
income (excluding dividend income explicitly recovered as part of investment cost) is recognised in
profit or loss, and subsequent changes in fair value are included in other comprehensive income
without provision for impairment. When financial assets are derecognised, the accumulated gains
or losses previously recognised in other comprehensive gains are transferred from other
comprehensive income and recognised in retained earnings.
Financial assets at fair value through profit or loss
The financial assets other than the above financial assets measured at amortised cost and
financial assets at fair value through other comprehensive income are classified as financial
assets at fair value through profit or loss. Such financial assets are subsequently measured at
fair value with net changes in fair value recognised in profit or loss except for the derivatives
designated as hedging instruments in an effective hedge.
Only when an accounting mismatch is eliminated or significantly decreased, 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; and other financial assets cannot
be re-designated after initial recognition as financial assets measured at fair value through profit or
loss.
Classification and measurement of financial liabilities
The Group’s financial liabilities are, on initial recognition, classified into financial liabilities at fair
value through profit or loss, other financial liabilities. For financial liabilities at fair value through
profit or loss, the relevant transaction costs are directly recognised in profit or loss, and the related
transaction costs of other financial liabilities are recognised in their initial amount.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
8. Financial instruments (Continued)
Classification and measurement of financial liabilities (Continued)
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 include financial liabilities held for trading
(including derivative instruments attributable to financial liabilities) and financial liabilities
designated upon initial recognition as at fair value through profit or loss. Financial liabilities held
for trading (including derivative instruments attributable to financial liabilities) are subsequently
measured at fair value. All changes in fair value of such financial liabilities are recognised in
profit or loss. Financial liabilities designated at fair value through profit or loss are subsequently
measured at fair value and gains or losses are recognised in profit or loss, except for the gains or
losses arising from the Group’s own credit risk which are presented in other comprehensive
income. If gains or losses arising from the Group’s own credit risk which are presented in other
comprehensive income will lead to or expand accounting mismatch in profit or loss, the Group will
include all the changes in fair value (including the amount affected by changes in the Group’s own
credit risk) of such financial liabilities in profit or loss.
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 the risk management or investment strategy has stated that the
portfolio 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 contains one or more embedded derivatives,
unless the embedded derivatives have no significant 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 measured
separately at the time of acquisition or on subsequent balance sheet days.
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 recognition.
Other financial liabilities
For such financial liabilities, subsequent measurement is made at amortised cost using the
effective interest rate method.
148
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
8. Financial instruments (Continued)
Impairment of financial assets
Based on the expected credit losses (“ECLs”), the Group recognises an allowance for ECLs for the
financial assets measured at amortised cost, debt investments at fair value through other
comprehensive income and contract assets.
For accounts receivable and contract assets that do not contain significant financing components,
the Group uses a simplified measurement method to measure loss provisions in accordance with
the amount of expected credit losses equivalent to the entire life cycle.
For accounts receivable and contract assets with significant financing components, the Group
uses 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 whether 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 measure 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 increased 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 compute interest income
according to the book balance and effective interest rate; and the period during which credit
impairment has occurred after initial recognition is considered the third stage, at which 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 on 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 on accounts receivable based on the aging portfolio.
Refer to Note 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 directly writes down the carrying amount of the financial
asset.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
8. Financial instruments (Continued)
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance
sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an
intention to settle on a net basis, or to realise the financial assets and settle the financial liabilities
simultaneously.
Transfer of financial assets
A financial asset is derecognised when the Group has transferred substantially all the risks and
rewards of the asset to the transferee. A financial asset is not derecognised when the Group
retains substantially all the risks and rewards of the financial asset.
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 recognised at the same time. If the Group retains control of the financial asset, it
recognises the financial asset to the extent of its continuing involvement in the transferred financial
asset and recognises an associated liability.
Continuing involvement that takes the form of a financial guarantee over the transferred 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. Inventories
Inventories include raw materials, work in progress, finished goods, delegate processing supplies
and turnover materials, and are measured at the lower of cost and net realizable value.
Inventories are initially carried at cost. Cost of inventories comprises all costs of purchase, costs of
conversion and other costs. Cost is determined on the weighted average basis. Turnover materials
include low-value consumables and packing materials, which are on the immediate write-off basis.
The Group adopts the perpetual inventory system.
At the balance sheet date, inventories are stated at the lower of cost and net realisable value.
The inventories are written down below cost to net realisable value and the write-down is
recognised in profit or loss if the cost is higher than the net realisable value. When the
circumstances that previously caused the inventories to be written down below cost no longer exist,
in which case the net realisable value of inventories becomes higher than the carrying amount, the
amount of the write-down is reversed. The reversal is limited to the amount of the original
write-down, and is recognised in profit or loss.
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. Finished goods are written down category by category.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
10. Long-term equity investments
Long-term equity investments include equity investments in subsidiaries, joint ventures and
associates.
A long-term equity investment is initially measured at its initial investment cost on acquisition. For
long-term equity investments arising from business combination involving enterprises under
common control, the initial investment cost shall be the share of the carrying amount of equity of
the acquiree in the consolidated financial statements of the ultimate controlling party as at the
combination date. The difference between the initial investment cost and book value of
consideration of combination is adjusted to capital reserves, and to retained earnings if capital
reserves is insufficient. Other comprehensive income recognised before the combination date is
accounted for on the same basis as would have been required if the investee had directly disposed
of the related assets or liabilities. Equity previously recognised resulting from the investee’s equity
changes other than profit or loss, other comprehensive income and profit distribution is reclassified
to profit or loss. Equity which still involves a long-term investment after disposal is reclassified to
profit or loss on a pro-rata basis and equity which switches to a financial instrument after disposal
is fully reclassified to profit or loss. For long-term equity investments arising from business
combination involving enterprises not under common control, the investment cost shall be the
combination cost. (For a business combination achieved in stages, the initial investment cost is
determined as the sum of the carrying amount of equity of the acquiree and the additional
investment costs on the combination date.) The combination cost involves the assets paid by the
acquirer, liabilities incurred and the fair value of equity securities. Other comprehensive incomes
recognised using the equity method before the combination date is accounted for on the same
basis as would have been required if the investee had directly disposed of the related assets or
liabilities. Equity previously recognised resulting from the investee’s equity changes other than
profit or loss, other comprehensive income and profit distribution is reclassified to profit or loss.
Equity which still involves a long-term investment after disposal is reclassified to profit or loss on a
pro-rata basis and equity which switches to a financial instrument after disposal is fully reclassified
to profit or loss. The accumulated changes in the fair value of financial assets at fair value through
other comprehensive income is reclassified to retained earnings when adopting the cost method.
Depending on the way of acquisition of long-term equity investments, the initial investment cost is
determined as follows: For long-term equity investments acquired by way of cash payment, the
initial investment cost includes all directly associated expenses, applicable taxes and fees, and
other necessary expenses. For long-term equity investments acquired by way of issuing equity
securities, the initial investment cost includes the fair value of equity securities. 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 — Swap 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.”
The Company's financial statements using the cost method of accounting for long-term equity can
exercise control over the investee. Control is the power to govern the financial and operating
policies of the investee so as to obtain benefits from its operating activities. In determining whether
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.
151
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
10. Long-term equity investments (Continued)
For long-term equity investments accounted for using the cost method, they are measured at the
initial Investment costs. The cost of long-term equity investments is adjusted with additional
investment or divestment. Cash dividends or profit distribution declared by the investees are
recognised as investment income in profit or loss.
The equity method is adopted when the Group has joint control, or exercises significant influence
over the investee. Joint control is the contractually agreed sharing of control of an arrangement,
which exists only when decisions about the relevant activities require the unanimous consent of
the parties sharing control. Significant influence is the power to participate in the financial and
operating policy decisions of the investee, but is not control or joint control with other parties over
those policies.
Under the equity method, where the initial investment cost of a long-term equity investment
exceeds the Group’s interest in the fair value of the investee’s identifiable net assets at the
acquisition date, no adjustment is made to the initial investment cost. Where the initial
investment cost is less than the Group’s interest in the fair values of the investee’s identifiable net
assets at the acquisition date, the difference is charged to profit or loss, and the cost of the
long-term equity investment is adjusted accordingly.
Under the equity method, after the Group has acquired a long-term equity investment, the Group
recognises its share of the investee’s profit or loss, as well as its share of the investee’s other
comprehensive income, as investment income or loss and other comprehensive income, and
adjusts the carrying amount of the investment accordingly. The Group recognises its share of the
investee’s profit or loss after making appropriate adjustments to the investee’s profit or loss based
on the fair value of the investee’s identifiable assets at the acquisition date, using the Group’s
accounting policies and periods. Unrealised profits and losses from transactions with its joint
ventures and associates are eliminated to the extent of the Group’s investments in the associates
or joint ventures (except for assets that constitute a business). The carrying amount of the
investment is reduced based on the Group’s share of any profit distributions or cash dividends
declared by the investee. The Group’s share of net losses of the investee is recognised to the
extent that the carrying amount of the investment together with any long-term interests that in
substance form part of its net investment in the investee is reduced to zero, except that the Group
has the obligations to assume further losses. The Group’s share of the investee’s equity changes,
other than those arising from the investee’s profit or loss, other comprehensive income or profit
distribution, is recognised in the Group’s equity, and the carrying amount of the long-term equity
investment is adjusted accordingly.
Upon disposal of a long-term equity investment, the difference between the proceeds actually
received and the carrying amount is recognised in profit or loss. For a long-term equity investment
accounted for using the equity method, when the Group discontinues using the equity method due
to disposal, all amounts previously recognised in other comprehensive income are accounted for
on the same basis as would have been required if the investee had directly disposed of the related
assets or liabilities. Equity previously recognised resulting from the investee’s equity changes
other than profit or loss, other comprehensive income and profit distribution is reclassified to profit
or loss in its entirety. When the Group continues to use the equity method, the amounts previously
recognised in other comprehensive income are accounted for on the same basis as would have
been required if the investee had directly disposed of the related assets or liabilities and
reclassified to profit or loss on a pro-rata basis. Equity previously recognised resulting from the
investee’s equity changes other than profit or loss, other comprehensive income and profit
distribution is reclassified to profit or loss on a pro-rata basis.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
11. Investment properties
Investment properties are properties held to earn rental income and/or for capital appreciation.
Investment properties include land use rights leased out, land use rights held for transfer upon
capital appreciation, and buildings leased out.
Investment properties are measured initially at cost. Subsequent expenditures incurred in relation
to investment properties are included in the 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 recognised in profit or loss in the period in which they are incurred.
The Group adopts the cost model for subsequent measurement of investment properties.
Buildings and land use rights are depreciated or amortised to their estimated net residual values
over their estimated useful lives. The estimated useful lives, the estimated net residual values that
are expressed as a percentage of cost and the annual depreciation (amortisation) rates of
investment properties are as follows:
Estimated useful lives Estimated residual value Annual depreciation
(amortisation) rates
Buildings and constructions 5-35 years 0-5% 2.71-19.00%
40-50 years or
Land use rights no fixed useful life 0% 2.00-2.50%
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 (amortisation) method
applied are reviewed and adjusted as appropriate at the end of each year.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
12. Fixed assets
Fixed assets are recognised only when the economic benefits associated with the asset will
probably flow into the Group and the cost of the asset can be measured reliably. Subsequent
expenditures incurred for a fixed asset that meets the recognition criteria shall be included in the
cost of the fixed asset, and the carrying amount of the component of the fixed asset that is
replaced shall be derecognised. Otherwise, such expenditures are recognised in profit or loss as
incurred.
Fixed assets are initially measured at cost, by taking into account the effect of any asset retirement
obligations. The cost of a purchased fixed asset comprises the purchase price, relevant taxes and
any directly attributable expenditure for bringing the asset to working condition for its intended use.
Depreciation is calculated using the straight-line method. The useful lives, estimated residual
value rates and annual depreciation rates of each category of the fixed assets are as follows:
Estimated useful lives Estimated residual values Annual depreciation rates
Buildings and constructions 4-40 years 0-5% 2.38-19.00%
Machinery 5-14 years 3-6% 6.71-19.40%
Motor vehicles 3-10 years 0-5% 9.50-33.33%
Office equipment 3-14 years 0-5% 6.79-33.33%
Electronic equipment 3-10 years 0-5% 9.50-33.33%
The Group reviews the useful life and estimated net residual value of a fixed asset and the
depreciation method applied at least at each year end, and make adjustments if necessary.
13. Borrowing costs
Borrowing costs are interest and other costs incurred by the Group in connection with the
borrowing of the funds. Borrowing costs include interest, amortisation of discounts or premiums
related to borrowings, ancillary costs incurred in connection with the arrangement of borrowings,
and exchange differences arising from foreign currency borrowings.
The borrowing costs that are directly attributable to the acquisition, construction or production of a
qualifying asset are capitalised. The amounts of other borrowing costs incurred are recognised
as an expense in the period in which they are incurred. Qualifying assets are assets (fixed assets,
investment properties, inventories, etc.) that necessarily take a substantial period of time of
acquisition, construction or production to get ready for their intended use or sale.
The borrowing costs shall not be capitalised 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 construction 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
13. Borrowing costs (Continued)
During the period of capitalization, the capitalised amount of interest in each accounting period
shall be calculated and determined in the ways below:
(1) The enterprise shall calculate and determine the interest of a specific loan by deducting interest
income of the loan capital deposit in the bank or investment income obtained from a temporary
investment.
(2) The enterprise shall calculate and determine the to-be-capitalised amount of interest on the
general borrowing by multiplying the weighted average asset disbursement of the part of the
accumulative asset disbursements minus the general borrowing by the capitalization rate of
the general borrowing used.
Capitalisation of borrowing costs is suspended during periods in which the acquisition,
construction or production of a qualifying asset is suspended abnormally by activities other than
those necessary to get the asset ready for its intended use or sale, when the suspension is for a
continuous period of more than 3 months. Borrowing costs incurred during these periods are
recognised as an expense in profit or loss until the acquisition, construction or production is
resumed.
14. Right-of-use assets
The right-of-use assets of the Group mainly include buildings and constructions, machinery,
vehicles, office equipment and other assets such as land use rights.
At the commencement date of the lease, the Group recognises a right-of-use asset. The cost of
the right-of-use asset comprises: (i) the amount of the initial measurement of the lease liability; (ii)
any lease payments made at or before the commencement date of the lease less any lease
incentives received; (iii) any initial direct cost incurred; and (iv) an estimate of costs incurred by the
lessee in dismantling and removing the underlying asset, restoring the site on which it is located or
restoring the underlying asset to the condition required by the terms and conditions of the lease.
The right-of-use assets are depreciated on a straight-line basis subsequently by the Group. If the
Group is reasonably certain that the ownership of the underlying asset will be transferred to the
Group at the end of the lease term, the Group depreciates the asset from the commencement date
to the end of the useful life of the asset. Otherwise, the Group depreciates the assets from the
commencement date to the earlier of the end of the useful life of the asset or the end of the lease
term.
The Group remeasures the lease liability at the present value of the changed lease payments and
adjusts the carrying amount of the right-of-use assets accordingly, when the carrying amount of
the right-of-use asset is reduced to zero, and there is a further reduction in the measurement of the
lease liability, the Group recognises the remaining amount of the remeasurement in profit or loss.
15. Construction in progress
The cost of construction in progress is determined according to the actual expenditures incurred
for the construction, including all necessary construction expenditures incurred during the
construction period, borrowing costs that shall be capitalised before the construction is ready for its
intended use, and other relevant expenditures.
An item of construction in progress is transferred to fixed assets when the asset is ready for its
intended use.
155
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
16. 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 enterprises
under common control should be measured at fair value separately as intangible assets when their
fair values can be reliably measured.
The useful life of the intangible 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 useful life when there is no foreseeable limit to the period over
which the asset is expected to generate economic benefits for the Group.
The useful lives of the intangible assets are as follows:
Categories Useful lives
Land use rights Between the approved useful period and the Company’s
operating period
Software 3-10 years
Trademarks and brands 10 years or no fixed useful life
use rights
Distribution network 10-20 years
Franchise 10 years
Favorable leases 16-20 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 recognised as cost of fixed assets, only if the separation was
impracticable.
Intangible assets with a finite useful life are amortised over their estimated useful lives using the
straight-line method. For an intangible asset with a finite useful life, the Group reviews the useful
life and amortisation method at least once at each financial year end, and makes adjustments
when necessary.
Land use rights allocated by the State are regarded as an intangible asset with an indefinite useful
life due to an uncertain useful life. The impairment test should be conducted for the intangible
assets with the indefinite service life every year to determine whether the impairment exists. The
intangible assets with the indefinite service life shall not be amortised, and the Company shall
make the review of the service life of the intangible assets during every accounting period. If
evidence prove that useful lives are finite, the Group accounts for the intangible assets in
accordance with intangible assets with a finite useful life.
156
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
16. Intangible assets (Continued)
Internal research and development project
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.
Expenditure 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 complete 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 marketable 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.
Expenditure for investigation, evaluation and selection of production process and new drug
researches is recognised in profit or loss in the period in which it is incurred. Expenditure on the
designation, measurement of the final utilization of the production process and new drugs before
mass production is capitalised only if all of the following conditions are satisfied:
(1) development of the production process and new drugs has been fully demonstrated by the
technical team;
(2) management has approved the budget of drug production development and new drugs;
(3) market research analysis suggests that the products produced by the new production
technology are able to be promoted;
(4) adequate technical, financial and other resources to complete the development and the
ability to use or sell the intangible asset;
(5) 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 recognised in profit or loss in
the period in which they are incurred. Development costs previously recognised as expenses are
not recognised as an asset in a subsequent period. Capitalised expenditure on the development
phase is presented as development costs in the balance sheet and transferred to intangible assets
at the date that the asset is ready for its intended use.
157
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
17. Impairment of assets
The Group determines the impairment of assets, other than the impairment of inventories,
investment properties measured using the fair value model, deferred tax assets, financial assets
and assets classified as held for sale, using the following methods:
The Group assesses at the balance sheet date whether there is any indication that an asset may
be impaired. If any indication exists that an asset may be impaired, the Group estimates the
recoverable amount of the asset and performs impairment testing. Goodwill arising from a
business combination and an intangible asset with an indefinite useful life are tested for
impairment at least at each year end, irrespective of whether there is any indication that the asset
may be impaired. Intangible assets that have not been ready for their intended use are tested for
impairment each year.
The recoverable amount of an asset is the higher of its fair value less costs to sell and the present
value of the future cash flows expected to be derived from the asset. The Group estimates the
recoverable amount on an individual basis unless it is not possible to estimate the recoverable
amount of the individual asset, in which case the recoverable amount is determined for the asset
group to which the asset belongs. Identification of an asset group is based on whether major cash
inflows generated by the asset group are largely independent of the cash inflows from other assets
or asset groups.
When the recoverable amount of an asset or asset group is less than its carrying amount, the
carrying amount is reduced to the recoverable amount by the Group. The reduction in the carrying
amount is treated as an impairment loss and recognised in profit or loss. A provision for
impairment loss of the asset is recognised accordingly.
For the purpose of impairment testing, the carrying amount of goodwill acquired in a business
combination is allocated from the acquisition date on a reasonable basis, to each of the related
asset groups unless it is impossible to allocate to the related asset groups, in which case it is
allocated to each of the related sets of asset groups. Each of the related asset groups or sets of
asset groups is an asset group or a set of asset groups that is expected to benefit from the
synergies of the business combination and shall not be larger than a reportable segment
determined by the Group.
When testing an asset group (a set of asset groups) to which goodwill has been allocated for
impairment, if there is any indication of impairment, the Group firstly tests the asset group (set of
asset groups), excluding the amount of goodwill allocated, for impairment, i.e., the Group
determines and compares the recoverable amount with the related carrying amount and
recognises any impairment loss. After that, the Group tests the asset group (set of asset groups),
including goodwill, for impairment, the carrying amount of the related asset group (set of asset
groups) is compared to its recoverable amount. If the carrying amount of the asset group (set of
asset groups) is higher than its recoverable amount, the amount of the impairment loss is firstly
used to reduce the carrying amount of the goodwill allocated to the asset group (set of asset
groups), and then used to reduce the carrying amount of other assets (other than the goodwill)
within the asset group (set of asset groups), on a pro-rata basis of the carrying amount of each
asset.
Once the above impairment loss is recognised, it will not be reversed for the value recovered in the
subsequent periods.
158
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
18. Long-term prepaid expenses
Long-term prepaid expenses include the expenditure for improvements to fixed assets under
operating leases, and other expenditures that have been made but should be recognised as
expenses over more than one year in the current and subsequent periods. Long-term prepaid
expenses are amortised on the straight-line basis over the expected beneficial period and are
presented at actual expenditure net of accumulated amortisation.
19. Medical reserve funds and specially approved reserving materials
Medical reserve funds refer to the funds appropriated by the State for the reserve of materials for
specified purposes to cope with major disasters, epidemic situations, first aid and other
emergencies, etc. Specially approved reserving materials refer to the medical commodities
required by the government to deal with emergencies such as epidemic situations, first aid and
local common diseases. According to the regulations of CNPGC, the Group, as an enterprise
undertaking the task of specially approved reserving materials reserve, obtains the medical
reserve funds provided by the PRC government, which appropriated to the local government and
CNPGC. The medical reserve funds received via those parties are recognised as other
non-current liabilities. In the meantime, the Government of Guangdong Province and Guangxi
Province designated Sinopharm Holding Guangzhou Co., Ltd. (“Sinopharm Guangzhou”) and its
subsidiaries, Sinopharm Holding Guangxi Co., Ltd. (“Sinopharm Guangxi”) and its subsidiaries to
undertake the storage, allocation and supply of pharmaceutical commodities required by major
disasters, epidemic situations, first aid and other emergencies as well as local common diseases
in Guangdong and Guangxi Zhuang Autonomous Region. According to the reserve plan (variety
and quantity) of the local government and CNPGC, the Group reserves the corresponding
specially approved reserving materials, implements dynamic management and recognises them
as other non-current assets.
20. Employee benefits
Employee benefits mainly include short-term employee benefits, post-employment benefits,
termination benefits and other long-term employee benefits incurred in exchange for service
rendered by employees or various forms of rewards or compensation due to severance of labor
relation.
Short-term employee benefits
The actual occurred short-term employee benefits are recognised as liabilities during the
accounting period in which the 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 the Group participate in social insurance 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.
159
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
20. Employee benefits (Continued)
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 approach.
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), is instantly recognised in the balance
sheet and charged to shareholders’ equity through other comprehensive income for the period
during which it is incurred. It will not be reversed to profit and loss in subsequent periods.
Previous service costs are recognised as current expenses when: the defined benefit scheme is
revised, or the 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 benefits are recognised as operating costs
and administration expenses in the income statement. Service costs include current services costs,
past service costs and settlement of profit or loss. Net interest include interest income from
scheme assets, interest expenses for scheme obligations and interest of the asset cap effect.
Termination benefits
The Group recognises a liability for termination benefits and charges to profit or loss at the earlier
of the following dates: a) when the Group can no longer withdraw from the termination plan or the
redundancy offer; and b) when the Group recognises costs or expense for a restructuring plan
which involves the payment of termination benefits.
The Group offers termination benefits to the employees who accept internal retirement
arrangements. Termination benefits refers to salaries and social securities paid to the employees
who voluntarily retire and approved by the management before the legal retirement age. The
Group pays termination benefits from the date of the starting of internal retirement arrangements
to legal retirement age. When meeting the recognition criteria, termination benefits are recognised
as liabilities from the date on which the employees stop offering services to the legal retirement
date and recognised in profit or loss as incurred. The change of termination benefits’ actuarial
assumptions and difference incurred by the adjustment of welfare standards are recognised in
profit or loss as incurred.
The termination benefits expected to be settled within one year since the balance sheet date are
classified as current liabilities.
Other long-term employee benefits
Other long-term employee’ 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 the current profit and loss or related asset costs.
160
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
21. Lease liabilities
At the commencement date of the lease, the Group measures the lease liability at the present
value of the lease payments that are not paid at that date, except for short-term leases and leases
of low-value assets. In calculating the present value of the lease payments, the Group uses the
interest rate implicit in the lease as the discount rate. If that rate cannot be readily determined, the
Group uses the lessee’s incremental borrowing rate. The Group calculates the interest expenses
of the lease liability in each period during the lease term using the constant periodic rate of interest,
and recognises such interest expenses in profit or loss, except those in the costs of the related
asset as required. Variable lease payments that are not included in the measurement of the lease
liabilities are recognised in profit or loss as incurred, except those in the costs of the related asset
as required.
After the commencement date of the lease, the Group remeasures lease liabilities with changed
present value of the lease payments when fixed payment, expected unguaranteed residual value
payable, the interest rate implicit in the lease as the discount rate, purchase options, options to
extend the lease or determination of the lease term change.
22. Provisions
An obligation related to a contingency shall be recognised by the Group as a provision when all of
the following conditions are satisfied, except for contingent considerations and contingent liabilities
assumed in a business combination not involving enterprises under common control:
(1) The obligation is a present obligation of the Group;
(2) It is probable that an outflow of economic benefits from the Group will be required to settle the
obligation; 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 pertaining 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 date. 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.
A contingent liability recognised in a business combination not involving entities under common
control is initially measured at fair value. Subsequently, it is measured at the higher of: (i) the
amount that would be recognised in accordance with the general policy for provisions above; and
(ii) the amount initially recognised less cumulative amortisation recognised in accordance with the
policy for revenue recognition.
161
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
23. Share-based payments
A share-based payment is classified as either an equity-settled share-based payment or a
cash-settled share-based payment. An equity-settled share-based payment is a transaction in
which the Group receives services and uses shares or other equity instruments as consideration
for settlement.
An equity-settled share-based payment in exchange for services received from employees is
measured at the fair value of the equity instruments granted to the employees. If such
equity-settled share-based payment could vest immediately, related costs or expenses at an
amount equal to the fair value on the grant date are recognised, with a corresponding increase in
capital reserves; if such equity-settled share-based payment could not vest until the completion of
services for a vesting period, or until the achievement of a specified performance condition, the
Group at each balance sheet date during the vesting period recognises the services received for
the current period as related costs and expenses, with a corresponding increase in capital
reserves, at an amount equal to the fair value of the equity instruments at the grant date. The fair
value is determined using the binomial model.
For awards that do not ultimately vest because non-market performance and service conditions
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 the market or non-vesting
condition is satisfied, provided that all other performance and service conditions are satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense 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 share-based 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 within 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 on the date that it is granted, the cancelled and new awards are
treated as if they were a modification of the original award.
The cost of cash-settled transactions is measured at the fair value of the liability which is
determined on the basis of shares or other equity instruments of the Group. It is initially recognised
at the fair value on the grant date using binomial model together with the consideration of terms
and conditions on which the equity instruments are granted. If the rights under a cash-settled
share-based payment could vest immediately, related costs or expenses at an amount equal to the
fair value on the grant date are recognised, with a corresponding increase in liability. If the rights
under a cash-settled share-based payment could not vest until the completion of services for a
vesting period, or until achievement of a specified performance condition, the Group at each
balance sheet date during the vesting period recognises the services received for the current
period as related costs and expenses, with a corresponding increase in liability, at an amount
equal to the fair value of the liability based on the best estimate of the outcome of vesting. The
liability is measured at each balance sheet date up to and including the settlement date, with
changes in fair value recognised in profit or loss.
162
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
24. Revenue from contracts with customers
Revenue from contracts with customers is recognised when the Group has fulfilled its performance
obligations in the contracts, that is, when the customer obtains control of relevant goods or
services. Control of relevant goods or services refers to the ability to direct the use of the goods, or
the provision of the services, and obtain substantially all of the remaining benefits from the goods
or services.
Contracts for the sale of goods
A contract for the sale of goods between the Group and the customer usually only includes the
performance obligation to transfer the goods. The revenue is recognised at the point of transferring
the control of goods in time based on the following indicators, which include: a present right to
payment for goods, the transfer of significant risks and rewards of ownership of goods, the transfer
of legal title to goods, the transfer of physical possession of goods, the customer's acceptance of
goods.
Service contracts
A contract for the rendering of services between the Group and the customer usually includes
performance obligations such as storage and logistics, etc. Because the customer simultaneously
receives and consumes the benefits provided by the Group's performance as the Group performs,
and the Group has an enforceable right to payment for performance completed to date, the
revenue is recognised over time only if the Group can reasonably measure its progress towards
the complete satisfaction of the performance obligation. The Group determines the progress of the
performance of contracts in accordance with the input method. If the progress towards the
complete satisfaction of the performance obligation cannot be reasonably measured, but the
Group expects to recover the costs incurred in satisfying the performance obligation, the revenue
is recognised only to the extent of the costs incurred until such time that the Group can reasonably
measure the progress towards the complete satisfaction of the performance obligation.
Variable consideration
Some of the Group's contracts with customers including arrangements of sales rebates result in
variable consideration. The Group determines the best estimate of variable consideration by using
the expected value method or the most likely amount method. However, the transaction price
including variable consideration is only to the extent that it is highly probable that a significant
reversal in the amount of cumulative revenue recognised will not occur when the uncertainty
associated with the variable consideration is subsequently resolved.
Consideration payable to customers
Where consideration is payable by the Group to a customer, such consideration payable shall be
deducted against the transaction price, and against current revenue upon the recognition 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 other clearly separable products.
163
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
24. Revenue from contracts with customers (Continued)
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 products. Amounts expected to be refunded for the return of sales are
recognised as liabilities. At the same time, the balance of the carrying value of the product
expected to be returned upon transfer 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 future return of sales and remeasures the above assets and liabilities.
Significant financing component
When the contract contains a significant financing component, the Group determines the
transaction price based on an amount that reflects the price that a customer would have paid for
the goods or services in cash at the time of obtaining the control of the goods or services, and
amortises the difference between the transaction price and the consideration promised in the
contract under the effective interest method within the contract period using the discount rate that
discounts the nominal amount of the contract consideration to the current selling price of the goods
or services.
The Group does not consider the effects of a significant financing component in the contract if it is
expected that the period between when the customer obtains control of the goods or services and
when the customer pays for such goods or services will be one year or less.
Warranties
The Group provides a warranty in connection with the sale of a good in accordance with the
contract and the relevant laws and regulations, etc. For an assurance-type warranty that provides
the customer the assurance that the good complies with agreed-upon specifications, the Group
accounts for the warranty in accordance with Note III (22). For a service-type warranty that
provides a customer with a service in addition to the assurance that the product complies with
agreed-upon specifications, the Group accounts for it as a separate performance obligation. On
the basis of the relative proportion between the stand-alone selling price of the good and the
service-type warranty, a portion of the transaction price is allocated to the service-type warranty
and revenue is recognised when a customer obtained control of the good. When assessing
whether a service-type warranty provides a customer with a separate service in addition to the
assurance that the good complies with agreed-upon specifications, the Group considers whether
the warranty is required by law, the length of the warranty coverage period and the nature of the
tasks that the Group promises to perform, etc.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
24. Revenue from contracts with customers (Continued)
Loyalty points programme
The Group grants a customer with loyalty points upon the sale of the goods or rendering of
services, which can be redeemed by the customers for free or discounted goods or services. The
loyalty points programme gives rise to a separate performance obligation as they provide a
material right to the customer. A portion of the transaction price is allocated to the loyalty points
awarded to the customer based on the relative proportion between the stand-alone selling price of
the goods or services and the loyalty points. Revenue is recognised when the customer obtains
control of the goods or services redeemed with the loyalty points or the loyalty points expire.
Principal/agent
When the Group obtains control of goods or another asset from a third party and then transfers it
to the customer, the Group is entitled to determine the transaction price of the goods or services
on its own, i.e., the Group controls the goods or services before transferring to the customer. Thus,
the Group is a principal and recognises revenue in the gross amount of consideration received or
receivable. Otherwise, the Group is an agent and recognises revenue in the amount of any fee or
commission to which it expects to be entitled from the customer. The amount is the net amount of
the gross consideration received or receivable after paying the other party the consideration
received in exchange for the goods or services to be provided by that party or determined by the
agreed-upon amount or proportion of commissions, etc.
25. Contract assets and contract liabilities
The Group presents contract assets or contract liabilities depending on the relationship between
the satisfaction of its performance obligations and the customer’s payment in the balance sheet.
The Group offsets the contract assets and contract liabilities under the same contract and presents
the net amount.
Contract assets
A contract asset is the right to consideration in exchange for goods or services that the Group has
transferred to a customer, and that right is conditioned on something other than the passage of
time.
For details of how the Group measures and accounts for the ECLs of a contract asset, refer to
Note III (8).
Contract liabilities
A contract liability is the obligation to transfer goods or services to a customer for which the Group
has received consideration or an amount of consideration is due from the customer, such as an
amount of consideration that an entity has received before the transfer of the promised goods or
services.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
26. Assets relating to contract cost
The Group’s contract cost assets include the costs to obtain and fulfil a contract and are classified
as inventories, other current assets and other non-current assets by liquidity.
The Group recognises as an asset the incremental costs of obtaining a contract with a customer if
the Group expects to recover those costs, unless the amortisation period of the asset is one year
or less.
Other than the costs which are capitalised as inventories, fixed assets and intangible assets, etc.,
costs incurred to fulfil a contract with a customer are capitalised as an asset if all of the following
criteria are met:
(1) the costs relate directly to a contract or to an anticipated contract, including direct labour,
direct materials, overheads (or similar expenses), costs that are explicitly chargeable to the
customer and other costs that are incurred only because an entity entered into the contract;
(2) the costs generate or enhance resources of the Group that will be used in satisfying
performance obligations in the future; and
(3) the costs are expected to be recovered.
The contract cost asset is amortised and charged to profit or loss on a systematic basis that is
consistent with the pattern of the revenue to which the asset related is recognised.
The Group accrues provisions for impairment and recognises impairment losses to the extent that
the carrying amount of a contract cost asset exceeds:
(1) the remaining amount of consideration that the entity expects to receive in exchange for the
goods or services to which the asset relates; less
(2) the costs that are expected to be incurred to transfer those related goods or services.
The Group recognises in profit or loss a reversal of the impairment loss previously recognised to
the extent that the difference between (1) and (2) exceeds the carrying amount of the asset due to
the subsequent changes of the factors causing asset impairment in previous periods, but the
carrying amount after the reversal does not exceed the carrying amount of the asset at the
reversal date if no impairment loss is otherwise recognised.
27. Government grants
Government grants are recognised when all attaching conditions will be complied with and the
grants will be received. If a government grant is in the form of a transfer of a monetary asset, it is
measured at the amount received or receivable. If a government grant is in the form of a transfer
of a non-monetary asset, it is measured at fair value; if fair value is not reliably determinable, it is
measured at a nominal amount.
Government grants related to assets refer to the long-term assets formed by acquisition,
construction, or other manners as stipulated in government documents. If the government
documents are not clear, the government grants related to assets are judged based on the basic
conditions that must be met to obtain the grants. When the long-term assets are formatted through
acquisition, construction, or other manners, the grants' amount shall be regarded as the
government grants related to assets. Otherwise, the grants' amount shall be regarded as the
government grants related to income.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
27. Government grants (Continued)
A government grant related to income is accounted for as follows: (i) if the grant is a compensation
for related expenses or losses to be incurred in subsequent periods, the grant is recognised as
deferred income, and released in profit or loss or offset against related expenses over the periods
in which the related costs are recognised; or (ii) if the grant is a compensation for related expenses
or losses already incurred, it is recognised immediately in profit or loss or offset against relevant
expenses.
A government grant relating to an asset shall be offset against the carrying amounts of relevant
assets, or recognised as deferred income and amortised in profit or loss over the useful life of the
related asset by annual instalments in a systematic and rational way (however, a government
grant measured at a nominal amount is recognised directly in profit or loss). Where the assets are
sold, transferred, retired or damaged before the end of their useful lives, the remaining deferred
income is released to profit or loss for the period in which the relevant assets are disposed of.
28. Income tax
Income tax comprises current and deferred tax. Income tax is recognised as income or expense in
profit or loss, or recognised directly in equity if it arises from a business combination or relates to a
transaction or event which is recognised directly in equity.
Current tax liabilities or assets arising from the current and prior periods at the amount expected to
be paid by the Group or returned by the tax authority are calculated according to related tax laws.
Deferred tax is provided using the balance sheet liability method, on all temporary differences at
the balance sheet date between the tax bases of assets and liabilities and their carrying amounts,
and temporary differences between the tax bases and the carrying amounts of the items, which
have a tax base according to related tax laws but are not recognised as assets and liabilities.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
(1) when the taxable temporary difference arises from the initial recognition of goodwill, or an
asset or liability in a transaction that is not a business combination and, at the time of
transaction, affects neither accounting profit nor taxable profit or loss; and
(2) in respect of taxable temporary differences associated with investments in subsidiaries,
associates and joint ventures, when the timing of the reversal of the temporary differences
can be controlled and it is probable that the temporary differences will not be reversed in the
foreseeable future.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
28. Income tax (Continued)
Deferred tax assets are recognised for all deductible temporary differences, and the carryforward
of unused tax losses and any unused tax credits. Deferred tax assets are recognised to the extent
that it is probable that taxable profit will be available against which the deductible temporary
differences, the carryforward of unused tax losses and unused tax credits can be utilised, except:
(1) when the deductible temporary difference arises from the initial recognition of an asset or
liability in a transaction that is not a business combination and, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss; and
(2) in respect of the deductible temporary differences associated with investments in
subsidiaries, associates and joint ventures, deferred tax assets are only recognised to the
extent that it is probable that the temporary differences will be reversed in the foreseeable
future and taxable profit will be available against which the temporary differences can be
utilised in the future.
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realised or the liability is settled, in accordance
with the requirements of tax laws. The measurement of deferred tax assets and deferred tax
liabilities reflects the tax consequences that would follow from the manner in which the Group
expects, at the balance sheet date, to recover the assets or settle the liabilities.
The carrying amount of deferred tax assets is reviewed at the balance sheet date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available in future periods
to allow the deferred tax assets to be utilised. Unrecognised deferred tax assets are reassessed at
the balance sheet date and are recognised to the extent that it has become probable that sufficient
taxable profit will be available to allow all or part of the deferred tax asset to be recovered.
Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally
enforceable right to set off current tax assets and current tax liabilities, and the deferred tax assets
and deferred tax liabilities relate to income taxes levied by the same taxation authority on either
the same taxable entity or different taxable entities which intend either to settle current tax
liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously,
in each future period in which significant amounts of deferred tax liabilities or assets are expected
to be settled or recovered.
29. Leases
Identification of leases
At inception of a contract, the Group assesses whether the contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to control the use of an identified
asset for a period of time in exchange for consideration. To assess whether a contract conveys
the right to control the use of an identified asset for a period of time, the Group assesses whether,
throughout the period of use, the customer has both of the right to obtain substantially all of the
economic benefits from use of the identified asset and the right to direct the use of the identified
asset.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
29. Leases (Continued)
Identification of separate lease components
For a contract that contains multiple separate lease components, the Group separates the
components of the contract and accounts for each separate lease component. The right to use an
underlying asset is a separate lease component if both:
(1) the lessee can benefit from use of the underlying asset either on its own or together with other
resources that are readily available to the lessee; and
(2) the underlying asset is neither highly dependent on, nor highly interrelated with, the other
underlying assets in the contract.
Separating lease components and non-lease components
For a contract that contains lease components and non-lease components, the Group accounts for
lease components and non-lease components separately as a lessor or a lessee.
Assessment of the lease term
The lease term is the non-cancellable period of a lease for which the Group has the right to use an
underlying asset. If the Group has an option to extend the lease, that is, the Group has the right to
extend the lease, and is reasonably certain to exercise that option, the lease term also includes
periods covered by an option to extend the lease. If the Group has an option to terminate the
lease, that is, the Group has the right to terminate the lease, but is reasonably certain not to
exercise that option, the lease term includes periods covered by an option to terminate the lease.
The Group reassesses whether it is reasonably certain to exercise an extension option, purchase
option, or not to exercise a termination option, upon the occurrence of either a significant event or
a significant change in the circumstances that is within the control of the Group and affects
whether the Group is reasonably certain to exercise an option not previously included in its
determination of the lease term.
As lessee
The Group accounts as a lessee applying Note III (14) and Note III (21).
Lease modifications
Lease modification is a change in the scope of a lease, or the consideration for a lease, that was
not part of the original terms and conditions of the lease, for example, adding or terminating the
right to use one or more underlying assets, or extending or shortening the contractual lease term.
The Group accounts for a lease modification as a separate lease if both:
(1) the modification increases the scope of the lease by adding the right to use one or more
underlying assets; and
(2) the consideration for the lease increases by an amount commensurate with the stand-alone
price for the increase in scope and any appropriate adjustments to that stand-alone price to
reflect the circumstances of the particular contract.
169
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
29. Leases (Continued)
As lessee (Continued)
Lease modifications (Continued)
For a lease modification that is not accounted for as a separate lease, at the effective date of the
lease modification the Group remeasures the lease liability by discounting the revised lease
payments using a revised discount rate. The revised discount rate is determined as the interest
rate implicit in the lease for the remainder of the lease term, or the lessee’s incremental borrowing
rate at the effective date of the modification, if the interest rate implicit in the lease cannot be
readily determined.
For a lease modification that is not accounted for as a separate lease, the Group accounts for the
remeasurement of the lease liability by:
(1) decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination
of the lease for lease modifications that decrease the scope of the lease, and recognising the
gain or loss relating to the partial or full termination of the lease in profit or loss; or
(2) making a corresponding adjustment to the right-of-use asset for all other lease modifications.
Short-term leases and leases of low-value assets
The Group considers a lease that, at the commencement date of the lease, has a lease term of 12
months or less, and does not contain any purchase option as a short-term lease; and a lease for
which the value of the individual underlying asset is not more than RMB40,000 when it is new as a
lease of low-value assets. If the Group subleases an asset, or expects to sublease an asset, the
head lease does not qualify as a lease of a low-value asset. The Group does not recognise the
right-of-use assets and lease liabilities for short-term leases and low-value assets. The Group
recognises lease payments on short-term leases and leases of low-value assets in the costs of the
related asset or profit or loss on a straight-line basis over the lease term.
COVID-19 related rent concessions
For rent concessions such as rent remission or deferred payment reached between the Group and
the lessor on the existing lease contract directly caused by the COVID-19 epidemic, and if the
following conditions are met at the same time, the Group adopts a simplified method for leasing:
(1) compared before the concession, the rental consideration after concession is reduced or
basically unchanged;
(2) the concession is only for lease payments payable before 30 June 2021;
(3) after comprehensive consideration of qualitative and quantitative factors, no significant
change in other terms and conditions of the lease is concluded.
The Group does not evaluate whether the lease has been changed. It will continue to calculate the
interest expense of the lease liabilities at the same discount rate before the concession and record
it into the current profit and loss. It will continue to calculate the depreciation of the right-of-use
assets in the same way as before the concession. For rent remissions incurred, the Group takes
the remitted rent as the variable lease payment, when the original rent payment obligation is
relieved by the agreement on concession, the cost or expense of the relevant assets shall be
offset according to the undiscounted amount, and the lease liabilities shall be adjusted accordingly
in the concession agreement, etc. For rent extension payment incurred, the Group will offset the
lease liability recognised in the earlier period when it is actually paid.
170
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
29. Leases (Continued)
As lessor
A lease is classified as a finance lease if it transfers substantially all the risks and rewards
incidental to ownership of an underlying asset, except that a lease is classified as an operating
lease at the inception date. The Group, as an intermediate lessor, classifies the sublease by
reference to the right-of-use asset arising from the head lease.
As lessor of an operating lease
Rent income under an operating lease is recognised on a straight-line basis over the lease term,
through profit or loss. Variable lease payments that are not included in the measurement of lease
receivables are charged to profit or loss as incurred.
The Group accounts for a modification to an operating lease as a new lease from the effective date
of the modification, considering any prepaid or accrued lease payments relating to the original
lease as part of the lease payments for the new lease.
30. Dividend distribution
Cash dividend distribution is recognised as a liability in the period in which it is approved by
shareholders at the annual shareholders’ meeting.
31. Fair value measurement
The Group measures its equity investments at fair value at each balance sheet date. Fair value is
the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value measurement is
based on the presumption that the orderly transaction to sell the asset or transfer the liability takes
place either in the principal market for the asset or liability, or in the absence of a principal market,
in the most advantageous market for the asset or liability. The principal or the most advantageous
market must be accessible by the Group at the measurement date. The fair value of an asset or a
liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their best economic interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability
to generate economic benefits by using the asset in its highest and best use or by selling it to
another market participant that would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which
sufficient data and other information are available to measure fair value, maximising the use of
relevant observable inputs and minimising the use of unobservable inputs.
171
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
31. Fair value measurement (Continued)
All assets and liabilities for which fair value is measured or disclosed in the financial statements
are categorised within the fair value hierarchy based on the lowest level input that is significant to
the fair value measurement as a whole:
Level 1 – based on quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 – based on valuation techniques for which the lowest level input that is significant to the
fair value measurement is observable, either directly or indirectly;
Level 3 – based on valuation techniques for which the lowest level input that is significant to the
fair value measurement is unobservable.
For assets and liabilities that are measured at fair value in the financial statements on a recurring
basis, the Group determines whether transfers have occurred between levels in the hierarchy by
reassessing categorisation at each balance sheet date.
32. Segment information
The Group identifies operating segments based on the internal organization structure,
management requirements and internal reporting system, and discloses segment information of
reportable segments which is determined on the basis of operating segments.
An operating segment is a component of the Group that satisfies all of the following conditions: (1)
the component is able to earn revenues and incur expenses from its ordinary activities; (2) the
component’s operating results are regularly reviewed by the Group’s management to make
decisions about resources to be allocated to the segment and to assess its performance, and (3)
for which the information on financial position, operating results and cash flows is available to the
Group. If two or more operating segments have similar economic characteristics and satisfy
certain conditions, they are aggregated into one single operating segment.
33. Significant accounting judgements and estimates
The preparation of the financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities, and
their accompanying disclosures, and the disclosure of contingent liabilities at the balance sheet
date. Uncertainty about these assumptions and estimates could result in outcomes that could
require a material adjustment to the carrying amounts of the assets or liabilities affected in the
future.
Judgements
In the process of applying the Group’s accounting policies, management has made the following
judgements, which have the most significant effect on the amounts recognised in the
financial statements:
Operating leases – as lessor
The Group has entered into lease agreements on its investment property portfolio. The Group has
determined these leases to be operating leases, based on an evaluation of the terms and
conditions of the agreements, that it retains substantially all the significant risks and rewards of
ownership of these properties.
172
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
33. Significant accounting judgements and estimates (Continued)
Judgements (Continued)
Business models
The classification of financial assets at initial recognition depends on the Group's business model
for managing financial assets. When determining the business model, the Group considers the
methods to include evaluation and report financial asset performance to key management, the
risks affecting the performance of financial assets and the risk management, and the manner in
which the relevant management receives remuneration. When assessing whether the objective
is to collect contractual cash flows, the Group needs to analyse and judge the reason, timing,
frequency and value of the sale before the maturity date of the financial assets.
Contractual cash flow characteristics
The classification of financial assets at initial recognition depends on the financial asset’s
contractual cash flow characteristics, and the judgements on whether the contractual cash flows
are solely payments of principal and interest on the principal amount outstanding, including when
assessing the modification of the time value of money, the judgement on whether there is any
significant difference from the benchmark cash flow and whether the fair value of the prepayment
features is insignificant for financial assets with prepayment features, etc.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the
balance sheet date, that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the future accounting periods, are described below.
Impairment of financial instruments
The Group uses the expected credit loss model to assess the impairment of financial instruments.
The Group is required to perform significant judgement and estimation and take into account all
reasonable and supportable information, including forward-looking information. When making
such judgements and estimates, the Group infers the expected changes in the debtor's credit risk
based on historical repayment data combined with economic policies, macroeconomic indicators,
industry risks and other factors. The different estimates may impact the impairment assessment,
and the provision for impairment may also not be representative of the actual impairment loss in
the future.
173
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
33. Significant accounting judgements and estimates (Continued)
Estimation uncertainty (Continued)
Impairment of non-current assets other than financial assets (other than goodwill)
The Group assesses whether there are any indications of impairment for all non-current assets
other than financial assets at the balance sheet date. Intangible assets with indefinite useful lives
are tested for impairment annually and at other times when such an indication exists. Other
non-current assets other than financial assets are tested for impairment when there are indications
that the carrying amounts may not be recoverable. An impairment exists when the carrying amount
of an asset or asset group exceeds its recoverable amount, which is the higher of its fair value less
costs of disposal and the present value of the future cash flows expected to be derived from it. The
calculation of the fair value less costs of disposal based on available data from binding sales
transactions in an arm’s length transaction of similar assets or observable market prices less
incremental costs for disposing of the assets. When the calculations of the present value of the
future cash flows expected to be derived from an asset or asset group are undertaken,
management must estimate the expected future cash flows from the asset or asset group and
choose a suitable discount rate in order to calculate the present value of those cash flows.
Further details are included in Note V (13), (14), (15), (16), (17).
Impairment of goodwill
The Group determines whether goodwill is impaired at least on an annual basis. This requires an
estimation of the present value of the future cash flows expected to be derived from the asset
groups (sets of asset groups) to which the goodwill is allocated. Estimating the present value
requires the Group to make an estimate of the expected future cash flows from the asset groups
(sets of asset groups) and also to choose a suitable discount rate in order to calculate the present
value of those cash flows. Further details are included in Note V (18).
Deferred tax assets
Deferred tax assets are recognised for all unused tax losses to the extent that it is probable that
taxable profit will be available against which the losses can be utilised. Significant management
judgement is required to determine the amount of deferred tax assets that can be recognised,
based upon the likely timing and level of future taxable profits together with future tax planning
strategies.
Fair value of non-listed equity investments
The unlisted equity investments have been valued based on the expected cash flows discounted
at current rates applicable for items with similar terms and risk characteristics. This valuation
requires the Group to make estimates about expected future cash flows, credit risk, volatility and
discount rates, and hence they are subject to uncertainty.
Loyalty points
The Group makes reasonable estimate of the stand-alone selling price of the loyalty points by
taking into account all relevant information, such as the stand-alone selling prices for the customer
to acquire additional free goods or services or the discounts enjoyed by the customer using the
loyalty points and the possibility for the customer to exercise the redemption right. The Group
considers the likelihood for the customer to exercise the redemption right based on the historical
data of point redemption, the current point redemption and the future changes for the customer,
the future trend of the market and other factors. The Group re-evaluates the stand-alone selling
price of loyalty points at least on each balance sheet date and determines the transaction price to
be allocated to the loyalty points based on the stand-alone selling price of the re-evaluated loyalty
points.
174
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
33. Significant accounting judgements and estimates (Continued)
Estimation uncertainty (Continued)
Sales with a right of return
The Group makes reasonable estimate of a group of contracts with similar characteristics
according to the sales return historical data, the current sales return situation, as well as customer
changes, market changes and other relevant information. Estimates of the expected return rate
may not be representative of the actual returns in the future. The Group re-evaluates the return
rate at least on each balance sheet date and updates the measurement of the refund liabilities and
the right-of-return assets based on the re-evaluated return rate.
Warranties
The Group makes reasonable estimate of the warranty rate of a group of contracts with similar
characteristics based on historical warranty data, current warranty, as well as all relevant
information such as product improvements, market changes, etc. Estimates of the expected
warranty rate may not be representative of the actual warranty rate in the future. The Group
re-evaluates the warranty rate at least on each balance sheet date and updates the measurement
of the provisions based on the re-evaluated warranty rate.
Assessment of constrains on variable consideration
The Group estimates, within a reasonable quantity, the amount of variable consideration that may
occur and the likelihood by taking into account all reasonably available information, including
historical information, current information, and predictive information. The Group includes in the
transaction price some or all of an amount of variable consideration estimated only to the extent
that it is highly probable that a significant reversal in the amount of cumulative revenue recognised
will not occur when the uncertainty associated with the variable consideration is subsequently
resolved. In assessing whether it is highly probable that a significant reversal in the amount of
cumulative revenue recognised will not occur once the uncertainty related to the variable
consideration is subsequently resolved, the Group considers both the likelihood and the
magnitude of the revenue reversal. On each balance sheet date, the Group updates the estimated
transaction price (including updating its assessment of whether an estimate of variable
consideration is constrained) to reflect the circumstances present at the end of the reporting period
and the changes in circumstances during the reporting period.
Lessee’s incremental borrowing rate
If the interest rate implicit in the lease cannot be readily determined, the Group measures the lease
liability at the present value of the lease payments discounted using the lessee’s incremental
borrowing rate. According to the economic environment, the Group takes the observable interest
rate as the reference basis for determining the incremental borrowing rate, then adjusts the
observable interest rate based on its own circumstances, underlying assets, lease terms and
amounts of lease liabilities to determine the applicable incremental borrowing rate.
175
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
III Summary of significant accounting policies and accounting estimates (Continued)
34. Changes in accounting policies and accounting estimates
Changes in accounting policies
Accounting process of COVID-19 related rent concessions
According to the accounting process regulations on rent concessions related to COVID-19 (‘the
process regulations’), the simplified method could be selected for rent concessions related to
COVID-19 on the basis of the process regulations. As a lessee, the Group has adopted the
simplified method in the process regulations (refer to Note III (29)) for the relevant rent
concessions of the leases incurred from 1 January 2020. The amount of the relevant rent
concessions reckoned in the profit for the year is RMB10,686,956.74.
IV Taxation
1. Main categories and rates of taxes:
Categories Tax base Tax rate
Corporate income tax
(“CIT”) Taxable income 10%,15%,20% or 25%
Taxable value-added amount (Tax
payable is calculated using the taxable
sales amount multiplied by the effective
tax rate less deductible VAT input of the
Value-added tax (“VAT”) current period) 0%,3%,5%,6%,9%,10%,13%
City maintenance and
construction tax Amount of VAT paid 5%,7%
Educational surcharge Amount of VAT paid 3%
Local educational surcharge Amount of VAT paid 2%
2. Tax preferences
In 2011, the Urumqi Head Office, Changji Branch and Karamay Branch of Sinopharm Holding
Xinjiang New & Special Medicines Chain Store Co., Ltd. (“Xinjiang New & Special Medicines”),
subsidiaries of the Company, shall pay tax at a rate of 15% by jurisdiction. According to the
Circular 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 reduced CIT rate of 15% from 1 January 2011 to 31 December
2020.
In 2014, the Company’s subsidiary, Sinopharm Holding Guangxi Logistics Co., Ltd. (“Sinopharm
Guangxi Logistics”), was approved by the Guangxi Local Tax Bureau to enjoy a tax discount
applicable to corporations in the region of Western Development to pay income tax at a tax rate
of 15% from 1 January 2014 to 31 December 2020.
176
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
IV Taxation (Continued)
2. Tax preferences (Continued)
In 2015, eight subsidiaries of the Company in the Guangxi Province, including Sinopharm
Guangxi, Sinopharm Holding Liuzhou Co., Ltd. (“Sinopharm Liuzhou”) , Sinopharm Holding
Beihai 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 Baise”) and Sinopharm
Holding Wuzhou Co., Ltd. (“Sinopharm Wuzhou”), were all approved by the National Taxation
Bureau or the Local Taxation Bureaus of Guangxi to enjoy a tax concession of Western
Development at a preferential CIT rate of 15%. The applicable period for Sinopharm Guangxi,
Sinopharm Liuzhou and Sinopharm Beihai is from 1 January 2014 to 31 December 2020, and
that for the other five subsidiaries is from 1 January 2015 to 31 December 2020.
In 2020, according to Cai Shui [2011] No.58, Sinopharm Holding Guoda Inner Mongolia
Pharmacy Chain Store Co., Ltd.(“Guoda Inner Mongolia”), Sinopharm Holding Hulun Buir
Pharmacy Chain Store Co., Ltd., Sinopharm Holding Guoda Drug Store Manchuria Co., Ltd.,
Inner Mongolia Guoda Medicine Co., Ltd., Sinopharm Holding Guoda Guangxi Pharmacy Chain
Store Co., Ltd., Ningxia Guoda Pharmacy Chain Store Co., Ltd., Guoda Pharmacy (Pu’er)
Songmao Co., Ltd. (“Guoda Pu’er”), Sinopharm Holding Qinzhou Co., Ltd., subsidiaries of the
Company, shall pay CIT at a rate of 15% by jurisdiction.
In 2020, according to the Notice on the implementation of inclusive tax reduction and exemption
policies for small and micro enterprises (Cai Shui [2019] No.13), subsidiaries of the Company
listed below qualified for the conditions of small low-profit enterprises, which the monomer
taxable income of these subsidiaries does not exceed RMB3 million. Hence, for the portion of
annual taxable income not exceeding RMB1 million, it shall be included in the taxable income by
25%, and enterprise income tax shall be paid at the rate of 20%; for the portion of annual taxable
income exceeding RMB1 million but not exceeding RMB3 million, it shall be included in the
taxable income by 50%, and enterprise income tax shall be paid at the rate of 20%.
The Company’s subsidiaries which qualified for the conditions of small low-profit enterprises
including Sinopharm Holding Hezhou Co., Ltd., Sinopharm Holding Hechi Co., Ltd., Shanghai
Guoda Dongsheng Pharmacy Co., Ltd., Shanghai Guoda Haohai Pharmacy Co., Ltd., Shanghai
Guoda Ruijing Pharmacy Co., Ltd., Shanghai Guoda Dongxin Pharmacy Co., Ltd., Sinopharm
Guoda Yongsheng Pharmacy (Shanghai) Co., Ltd., Zhejiang Sinopharm Pharmacy Dongshan
Pharmacy Co., Ltd., Sinopharm Holding Guoda Pharmacy Guangzhou Chain Co., Ltd., Taishan
Sinopharm Holding Guoda Qunkang Pharmacy Chain Store Co., Ltd. (“Guoda Taishan”),
Sinopharm Holding Guoda Pharmacy Yongxingtang Chain Store (Chaoyang) Co., Ltd.(”Guoda
Yongxingtang”), Liaoning Guoda Medicine Co., Ltd., Sinopharm Holding Guoda Pharmacy
Bayannur Co., Ltd., Sinopharm Holding Guoda Pharmacy Ulanqab Co., Ltd., Sinopharm Holding
Baiyi Pharmacy Guangxi Co., Ltd. , Sinopharm Accord (Guangzhou) Medicine Co.,
Ltd.(“Guangzhou Medicine”), Guangxi Guoda Pharmaceutical Consulting Chain Co., Ltd.,
Liaoning Guoda Health Pharmacy Co., Ltd., Liaoning Guoda Pharmacy Chain Co., Ltd., Yanji
Xianghe Medicine Co., Ltd., Inner Mongolia Chengda Fangyuan Medicine Co., Ltd., Hebei
Chengda Fangyuan Medicine Chain Co., Ltd., Shandong Chengda Fangyuan Medicine Chain
Co., Ltd., Jilin Chengda Fangyuan Medicine Co., Ltd., Jilin Chengda Fangyuan Medicine Chain
Co., Ltd., Liaoning Chengda Fangyuan Technical Training School, Liaoning Zhicheng Xingda
Advertising Media Co., Ltd., and Dalian Zhengda Pharmaceutical Co., Ltd., etc.
177
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements
1. Cash and bank balances
31 December 2020 31 December 2019
Cash on hand 6,707,125.90 5,333,515.38
Cash at banks 5,398,406,132.09 8,437,723,437.66
Cash and cash equivalents 5,398,406,132.09 8,420,737,654.78
Undue interest receivable - 16,985,782.88
Other cash balances 593,091,037.88 442,672,297.43
Deposits for bank acceptance
bills 492,734,978.75 440,219,920.94
Freezing of funds 66,956,993.60 -
Medical reserve funds 27,465,331.50 -
Fixed deposit 3,167,718.14 -
Other deposits 2,766,015.89 2,452,376.49
5,998,204,295.87 8,885,729,250.47
Current deposits earn interest at the rate based on current deposit interest rates. Maturities of
short-term time deposits range from 1 month to 6 months depending on the fund arrangements of
the Group, and the deposits earn interest at the respective deposit rates.
2. Notes receivable
31 December 2020 31 December 2019
Commercial acceptance bills 623,594,997.36 793,301,688.64
Less: Bad debt provision for notes
receivable 1,479,520.32 -
622,115,477.04 793,301,688.64
178
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
2. Notes receivable (Continued)
The carrying amount of notes receivable that affected the changes in provision this year is as follows:
31 December 2020
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which provision
for bad debts is
recognised individually 27,634,855.48 4.43% (1,479,520.32) 5.35% 26,155,335.16
Items for which provision
for bad debts is
recognised by group
(credit risk
characteristics) 595,960,141.88 95.57% - - 595,960,141.88
623,594,997.36 100.00% (1,479,520.32) 0.24% 622,115,477.04
31 December 2019
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which provision
for bad debts is
recognised individually - - - - -
Items for which provision
for bad debts is
recognised by group
(credit risk
characteristics) 793,301,688.64 100.00% - - 793,301,688.64
793,301,688.64 100.00% - - 793,301,688.64
179
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
2. Notes receivable (Continued)
At 31 December 2020, notes receivable that are individually assessed for provisions are as follows:
Carrying Expected credit Assessment for
amount Bad debt provision loss rate impairment
The drawer has
historical credit
defaults; the notes
receivable are
expected to be at
Client A 25,673,156.00 (1,471,457.31) 5.73% risk of collection.
The drawer has
historical credit
defaults; the notes
receivable are
expected to be at
Client B 1,961,699.48 (8,063.01) 0.41% risk of collection.
27,634,855.48 (1,479,520.32)
At 31 December 2019, the Group had no individual provision for bad debts on notes receivable.
Changes in provision for bad debts on notes receivable are presented as follows:
Opening Increase Reversal Write-off Closing
balance in the year in the year in the year balance
2020 - 1,479,520.32 - - 1,479,520.32
2019 - - - - -
At 31 December 2020 and 31 December 2019, the Group had no pledged notes receivable.
Notes receivable endorsed or discounted by the Group to other parties which were not yet due at 31
December 2020 and 31 December 2019 are as follows:
31 December 2020 31 December 2019
Derecognised Not Derecognised Not
derecognised derecognised
Commercial
acceptance bills - 4,095,283.92 - 64,038,348.12
180
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
2. Notes receivable (Continued)
As at 31 December 2020 and 31 December 2019, notes receivable that were converted into
accounts receivable due to the drawer’s inability to settle the notes on the maturity date are as
follows:
31 December 2020 31 December 2019
Commercial acceptance bills 2,276,824.52 1,174,861.29
3. Accounts receivable
The credit period for accounts receivable normally is 3 months. Accounts receivable are interest-free.
An aging analysis of accounts receivable is as follows:
31 December 2020 31 December 2019
Within 1 year 13,575,070,031.31 10,723,116,561.96
1 to 2 years 263,187,281.70 19,945,711.69
2 to 3 years 31,013,755.63 896,129.90
Over 3 years 23,213,398.71 14,941,871.10
Less: Bad debt provision for accounts
receivable 92,513,453.13 45,916,730.47
13,799,971,014.22 10,712,983,544.18
181
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
The carrying amount of accounts receivable that affected the changes in provision this year is as
follows:
31 December 2020
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which
provision for bad
debts is recognised
individually 674,370,776.75 4.85% (29,223,931.45) 4.33% 645,146,845.30
Items for which
provision for bad
debts is recognised
by group (credit risk
characteristics) 13,218,113,690.60 95.15% (63,289,521.68) 0.48% 13,154,824,168.92
13,892,484,467.35 100.00% (92,513,453.13) 0.67% 13,799,971,014.22
31 December 2019
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which
provision for bad
debts is recognised
individually 586,321,444.68 5.45% (18,329,609.15) 3.13% 567,991,835.53
Items for which
provision for bad
debts is recognised
by group (credit risk
characteristics) 10,172,578,829.97 94.55% (27,587,121.32) 0.27% 10,144,991,708.65
10,758,900,274.65 100.00% (45,916,730.47) 0.43% 10,712,983,544.18
182
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
At 31 December 2020, accounts receivable that are individually significant and individually assessed for provisions are as
follows:
Expected
Credit Loss
Carrying amount Bad debt provision Rate Assessment for impairment
The receivable of medical
Receivable of medical insurance has lower-tier
insurance 488,783,757.67 (6,626,589.08) 1.36% default risk.
The debtor had irregular
operations, subjected to
severe financial difficulties,
and related to multiple
lawsuits, with lower-tier
Client A 11,559,178.29 (11,559,178.29) 100.00% recoverability.
The debtor had irregular
operations, subjected to
severe financial difficulties,
and has been placed on a
national list of defaulters,
with a high risk of going
bankruptcy or financial
Client B 2,447,976.74 (2,447,976.74) 100.00% restructuring.
The debtor had irregular
operations, subjected to
severe financial difficulties,
and has been placed on a
national list of defaulters,
with a high risk of going
bankruptcy or financial
Client C 2,365,253.03 (2,365,253.03) 100.00% restructuring.
Part of the receivable takes
longer than usual to recover,
Others 169,214,611.02 (6,224,934.31) 3.68% and has risk of recoverability
674,370,776.75 (29,223,931.45)
183
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
At 31 December 2019, accounts receivable that were individually significant and individually assessed for provisions are
as follows:
Expected
Credit Loss
Carrying amount Bad debt provision Rate Assessment for impairment
The receivable of medical
Receivable of medical insurance has lower-tier
insurance 425,784,659.32 - 0.00% default risk.
The debtor had irregular
operations, subjected to
severe financial difficulties,
and related to multiple
lawsuits, with lower-tier
Client A 11,559,178.29 (11,559,178.29) 100.00% recoverability.
The debtor had irregular
operations, subjected to
severe financial difficulties,
and has been placed on a
national list of defaulters, with
a high risk of going
bankruptcy or financial
Client B 2,447,976.74 (2,447,976.74) 100.00% restructuring.
The debtor had irregular
operations, subjected to
severe financial difficulties,
and has been placed on a
national list of defaulters, with
a high risk of going
bankruptcy or financial
Client C 2,365,253.03 (2,365,253.03) 100.00% restructuring.
Part of the receivable takes
longer than usual to recover,
Others 144,164,377.30 (1,957,201.09) 1.36% and has risk of recoverability
586,321,444.68 (18,329,609.15)
The accounts receivable for which the Group recognised provision for bad debts by credit risk characteristics are
presented as follows:
31 December 2020 31 December 2019
Estimated gross Expected Lifetime Estimated gross Expected Lifetime
carrying amount at credit loss expected credit carrying amount at credit loss expected credit
default ratio loss default ratio loss
Within 1 year 12,930,648,987.23 0.20% (26,043,994.99) 10,150,834,990.25 0.25% (25,093,316.99)
1 to 2 years 257,905,763.20 11.04% (28,463,763.63) 18,859,269.14 10.47% (1,974,732.42)
2 to 3 years 21,112,155.47 17.39% (3,671,293.61) 896,129.90 13.34% (119,533.01)
Over 3 years 8,446,784.70 60.50% (5,110,469.45) 1,988,440.68 20.09% (399,538.90)
13,218,113,690.60 (63,289,521.68) 10,172,578,829.97 (27,587,121.32)
184
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
Changes in provision for bad debts are presented as follows:
Reversal of
Opening write-off in Increases in Increases in Reversal in Write-off in
Closing balance
balance previous the year merger the year the year
years
2020 45,916,730.47 167,797.87 29,942,655.08 25,219,814.78 (8,733,545.07) - 92,513,453.13
2019 44,889,741.84 22,080.00 25,069,219.09 56,980.49 (20,297,750.93) (3,823,540.02) 45,916,730.47
Important recovered or reversed items of provision for individually assessed bad debts in 2020 are listed below:
Reason for recoverability or Original assessment for Recovered or Method of recovery or
reversal impairment reversed amount reversion
Resolve
Resolve reconcilia reconciliation
Client A tion differences Uncertainty in recovery 150,869.44 differences
Client B Amount received Uncertainty in recovery 87,940.68 Amount received
Client C Amount received Uncertainty in recovery 61,938.17 Amount received
Client D Amount received Uncertainty in recovery 60,323.54 Amount received
361,071.83
Important recovered or reversed items of provision for individually assessed bad debts in 2019 are listed below:
Reason for recoverability or Original assessment for Recovered or Method of recovery or
reversal impairment reversed amount reversion
Client A Amount received Uncertainty in recovery 167,280.00 Amount received
Client B Amount received Uncertainty in recovery 140,801.62 Amount received
Client C Amount received Uncertainty in recovery 117,446.10 Amount received
Client D Amount received Uncertainty in recovery 99,886.22 Amount received
525,413.94
185
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
Accounts receivable written off in 2020 are nil (2019: RMB3,823,540.02).
Accounts receivable written off in 2019 are analysed below:
Nature of the Fulfilled write-off procedure Related party
receivable Amount Reason s transaction or not
The write-off procedures
have been fulfilled in
accordance with the internal
Client A Payment for goods 793,588.14 Non-recoverable rules and regulations. No
The write-off procedures
have been fulfilled in
accordance with the internal
Client B Payment for goods 506,604.84 Non-recoverable rules and regulations. No
The write-off procedures
have been fulfilled in
accordance with the internal
Client C Payment for goods 280,324.00 Non-recoverable rules and regulations. No
The write-off procedures
have been fulfilled in
accordance with the internal
Client D Payment for goods 276,000.00 Non-recoverable rules and regulations. No
The write-off procedures
have been fulfilled in
accordance with the internal
Others Payment for goods 1,967,023.04 Non-recoverable rules and regulations. No
3,823,540.02
As at 31 December 2020, the top five accounts receivable analysed by customer are summarised below:
% of the total accounts
Amount Bad debt provision amount receivable
Top 1 Account receivable 204,532,139.94 (895,128.97) 1.47%
Top 2 Account receivable 197,835,785.38 (1,600,707.66) 1.42%
Top 3 Account receivable 169,474,358.70 (10,782.57) 1.22%
Top 4 Account receivable 161,218,733.31 (529,704.61) 1.16%
Top 5 Account receivable 153,017,656.79 (558,855.24) 1.10%
886,078,674.12 (3,595,179.05) 6.37%
186
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
As at 31 December 2019, the top five accounts receivable analysed by customer are summarised
below:
Bad debt provision % of the total accounts
Amount amount receivable
Top 1 Account receivable 170,343,305.26 (651,626.93) 1.58%
Top 2 Account receivable 168,729,902.27 (1,268,752.66) 1.57%
Top 3 Account receivable 165,585,249.66 (834,284.84) 1.54%
Top 4 Account receivable 149,692,676.64 (497,239.72) 1.39%
Top 5 Account receivable 141,678,146.50 (522,091.42) 1.32%
796,029,280.33 (3,773,995.57) 7.40%
In 2020, the Group factored a portion of accounts receivable at amortised cost to financial
institutions. The amount of accounts receivable derecognised was RMB5,131,305,168.48 (2019:
RMB6,274,777,382.79), and the amount of loss recognised through investment income was
RMB76,142,835.36 (2019: RMB86,377,492.55).
Refer to Note VIII (2) for details of transfer of accounts receivable.
4. Receivables financing
31 December 2020 31 December 2019
Bank acceptance bills 1,404,987,700.38 446,342,588.46
The pledged receivables financings are as follows:
31 December 2020 31 December 2019
Bank acceptance bills 2,620,000.00 -
Receivables financing endorsed or discounted by the Group to other parties which were not yet
due at 31 December 2020 and 31 December 2019 are as follows:
31 December 2020 31 December 2019
Derecognised Not Derecognised Not
derecognised derecognised
Bank acceptance bills 1,613,842,670.80 23,843,867.66 2,280,123,957.94 -
As at 31 December 2020 and 31 December 2019, no receivables financing were converted into
accounts receivable due to the drawer’s inability to settle the notes on the maturity date.
187
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
5. Advances to suppliers
The aging of advances to suppliers is analysed below:
31 December 2020 31 December 2019
Amount % of total balance Amount % of total balance
Within 1 year 480,215,111.42 99.98% 388,572,636.93 99.68%
1 to 2 years 42,225.29 0.01% 244,213.07 0.06%
2 to 3 years 56,238.00 0.01% 815,319.09 0.21%
Over 3 years - - 196,616.45 0.05%
480,313,574.71 100.00% 389,828,785.54 100.00%
As at 31 December 2020, the top five advances to suppliers analysed by customer are
summarised below:
Amount Proportion of total balance
Total amount of top five advances to
suppliers 41,313,738.82 8.60%
As at 31 December 2019, the top five advances to suppliers analysed by customer are
summarised below:
Amount Proportion of total balance
Total amount of top five advances to
suppliers 56,871,461.86 14.59%
188
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
6. Other receivables
31 December 2020 31 December 2019
Dividend receivable - 834,914.61
Other receivables 535,228,747.69 501,123,926.82
535,228,747.69 501,958,841.43
Dividend receivable
31 December 2020 31 December 2019
Shanghai Dingqun Enterprise
Management Consulting Co., Ltd
(“Shanghai Dingqun”) - 834,914.61
Other receivables
The aging of other receivables is analysed below:
31 December 2020 31 December 2019
Within 1 year 480,713,606.60 474,417,883.73
1 to 2 years 41,156,242.37 62,071,561.00
2 to 3 years 57,236,236.46 7,494,548.87
Over 3 years 25,311,879.53 21,330,491.94
Less: Bad debt provision for other
receivables 69,189,217.27 64,190,558.72
535,228,747.69 501,123,926.82
189
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
Categories of other receivables by nature are as follows:
31 December 2020 31 December 2019
Deposits 287,130,364.44 275,364,596.97
Receivable of price reduction compensation and
purchasing rebates 85,263,225.16 67,585,688.47
Receivable of the pharmaceutical electronic
trading and other platforms 60,267,511.03 49,597,763.58
Entrusted borrowings 46,334,222.24 45,360,333.35
Petty cash advance to employees 22,994,684.93 11,606,921.79
Receivable of equity transactions 8,980,000.00 8,980,000.00
Receivable due from related parties 2,867,594.20 25,786,279.26
Others 90,580,362.96 81,032,902.12
Less: Bad debt provision for other receivables 69,189,217.27 64,190,558.72
535,228,747.69 501,123,926.82
190
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
Changes in bad debt provision for the 12-month expected credit losses and lifetime expected credit losses on
other receivables are as follows:
2020
Stage 1 Stage 2 Stage 3 Total
12-month Lifetime Credit-impaired
expected expected financial
credit credit losses assets
losses (Lifetime
expected credit
losses)
Balance at 1 January 2020 - 7,107,131.41 57,083,427.31 64,190,558.72
Balance at 1 January 2020 during the period - - - -
--Transfer to the Stage 2 - - - -
--Transfer to the Stage 3 - - - -
--Reverse to the Stage 2 - - - -
--Reverse to the Stage 1 - - - -
Provisions during the period - 2,577,812.48 3,656,500.59 6,234,313.07
Reversal during the period - (2,904,835.82) (42,787.50) (2,947,623.32)
Transfer out during the period - - - -
Write-off during the period - (124,000.00) (4,028.03) (128,028.03)
Addition due to combination - 649,041.83 1,190,955.00 1,839,996.83
Reversal of write-off in previous years - - - -
Balance at 31 December 2020 - 7,305,149.90 61,884,067.37 69,189,217.27
191
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
Changes in bad debt provision for the 12-month expected credit losses and lifetime expected credit losses on
other receivables are as follows: (continued)
2019
Stage 1 Stage 2 Stage 3 Total
12-month Lifetime Credit-impaired
expected expected financial
credit credit losses assets
losses (Lifetime
expected
credit losses)
Balance at 1 January 2019 - 3,266,686.35 16,931,993.69 20,198,680.04
Balance at 1 January 2019 during the period - - - -
--Transfer to the Stage 2 - - - -
--Transfer to the Stage 3 - - - -
--Reverse to the Stage 2 - - - -
--Reverse to the Stage 1 - - - -
Provisions during the period - 4,805,326.24 45,405,997.63 50,211,323.87
Reversal during the period - (1,005,631.78) (920,960.13) (1,926,591.91)
Write-back during the period - - - -
Write-off during the period - - (4,333,603.88) (4,333,603.88)
Addition due to combination - 200.00 - 200.00
Reversal of write-off in previous years - 40,550.60 - 40,550.60
Balance at 31 December 2019 - 7,107,131.41 57,083,427.31 64,190,558.72
The bad debt provision amount of other receivables in 2020 was RMB6,234,313.07 (2019: RMB50,211,323.87),
with the recovered or reversed amount of RMB2,947,623.32 (2019: RMB1,926,591.91).
The write-off amount of other receivables in 2020 was RMB128,028.03 (2019: RMB4,333,603.88).
192
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
As at 31 December 2020, the top 5 parties that owed the largest amounts of other receivable balances are analysed below:
% of
total Provision of bad
Nature Amount Age amount debts
Guangdong Pharmaceutical Repayment not yet cleared
electronic trading from the pharmaceutical
platform trading platform 46,564,683.73 Within 1 year 7.70% -
Sinopharm Group Zhijun
(Suzhou) Pharmaceutical
Co., Ltd. (“Zhijun
Suzhou”) (1) Entrusted borrowings 46,334,222.24 2 to 3 years 7.67% 46,334,222.24
Receivable of price
AstraZeneca (Wuxi) Trading reduction compensation
Co., Ltd. and purchasing rebates 22,486,430.15 Within 1 year 3.72% -
TCM-Integrated Hospital of
Southern Medical Deposit from a logistics
University extension service project 20,000,000.00 Over 3 years 3.31% -
Changchun Society Medical
Insurance Management
Bureau Medical insurance deposit 15,552,920.92 Within 1 year 2.57% -
150,938,257.04 24.97% 46,334,222.24
As at 31 December 2019, the top 5 parties that owed the largest amounts of other receivable balances are analysed below:
% of total Provision of bad
Nature Amount Age amount debts
Zhijun Suzhou Entrusted borrowings 45,360,333.35 1 to 2 years 8.02% 45,360,333.35
Guangdong Pharmaceutical Repayment not yet cleared
electronic trading from the pharmaceutical
platform trading platform 35,328,767.60 Within 1 year 6.25% -
Receivables from related
Sinopharm Group parties 22,000,000.00 Within 1 year 3.89% -
TCM-Integrated Hospital of
Southern Medical Deposit from a logistics
University extension service project 20,000,000.00 2 to 3 years 3.54% -
Shenyang Society Medical
Insurance Management
Bureau Medical insurance deposit 19,676,531.29 Within 1 year 3.48% -
142,365,632.24 25.18% 45,360,333.35
(1) With bad operation, declining solvency and increasing credit risk of Zhijun Suzhou, the Company accrued the total amount of
the entrusted borrowings of Zhijun Suzhou for bad debt provision with a prudent principle.
193
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
There were no government grants receivable in 2020.
As at 31 December 2019, the amount of government grants receivable is analysed below:
Grants program Amount Aging Estimated collection time, amount and basis
Karamay Social Based on “Measures of Karamay City for
Insurance employment promotion” (Kerenshefa
Administration Karamay Employment [2017] No.184), expected to be fully
Bureau Promotion Award 15,128.72 Within 1 year recovered in June 2020
7. Inventories
Inventories by category are analysed below:
31 December 2020 31 December 2019
Book value Provision Net book value Book value Provision Net book value
Raw materials 1,959,948.73 - 1,959,948.73 645,627.66 - 645,627.66
Finished goods 6,292,866,195.61 (12,997,334.35) 6,279,868,861.26 5,067,666,999.13 (8,902,200.40) 5,058,764,798.73
Work in progress 244,341.19 - 244,341.19 140,458.20 - 140,458.20
Low cost consumables 2,937,523.28 - 2,937,523.28 3,723,258.67 - 3,723,258.67
6,298,008,008.81 (12,997,334.35) 6,285,010,674.46 5,072,176,343.66 (8,902,200.40) 5,063,274,143.26
Provision for inventories is analysed below:
Back-transfer of Increases Decreases
1 January previous years’ Addition due to 31 December
31 December 2020 2020 write-off Current combination Reversal Write-off 2020
Finished goods 8,902,200.40 - 7,054,810.15 474,033.43 (1,975,512.44) (1,458,197.19) 12,997,334.35
Back-transfer of Increases Decreases
1 January previous years’ Addition due to 31 December
31 December 2019 2019 write-off Current combination Reversal Write-off 2019
8,980,606.86 5,356.03 4,362,375.48 139,294.62 (3,181,477.32) (1,403,955.27) 8,902,200.40
Finished goods
In 2020, due to the value recovery of partial inventories, provision for inventories was reversed by
RMB1,975,512.44 (2019: RMB3,181,477.32), and due to the sales of goods in stock, provision for
inventories was written off by RMB1,458,197.19 (2019: RMB1,403,955.27).
194
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
8. Contract assets
31 December 2020 31 December 2019
Book Value Provision Net Book Value Book Value Provision Net Book Value
Medical devices
and equipment
guarantee funds 15,195,530.95 (17,799.31) 15,177,731.64 - - -
The Group sells medical devices and equipment to customers and provides relevant installation services, which constitutes a
single performance obligation. After the delivery of medical devices and equipment by the Group and acceptance by
customers, the control rights of goods are transferred. The Group recognises the relevant income and transfers part of the
contract consideration to receivables, and the other parts are formed as contract assets. After the equipment is installed and
the agreed warranty period ends, the contract assets will form an unconditional right of collection and be transferred into
receivables.
Changes in provision for contract assets are presented as follows:
Opening Increase Reversal in Resale in Written off in Closing Balanc
Balance in the year the year the year the year e
2020 - 17,799.31 - - - 17,799.31
2019 - - - - - -
An aging analysis of contract assets with provision for impairment are as follows:
31 December 2020 31 December 2019
Estimated Expected credit Expected credit loss Estimated Expected credit Expected credit loss in
default amount loss rate in entire lifetime default amount loss rate entire lifetime
Within 1 year 15,195,530.95 0.12% 17,799.31 - - -
9. Other current assets
31 December 2020 31 December 2019
VAT tax credit 114,251,111.76 101,376,603.92
CIT to be deducted 5,981,268.15 513,305.14
Others 850,483.54 317,589.14
121,082,863.45 102,207,498.20
195
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
10. Long-term equity investments
2020
Changes in the year
Amount of
Investee 1 January 2020 Additional / Profit or loss under Changes in other Other changes Cash dividends or Provision for 31 December 2020 provision for
reductive the equity method comprehensive income in equity profits declared for impairment impairment
Investment distribution
Shenzhen Main Luck Pharmaceutical Inc.
(“Main Luck Pharmaceutical”). (a) 294,469,367.27 - 91,569,378.60 - - (63,342,000.00) - 322,696,745.87 -
Shanghai Beiyi Guoda Pharmaceutical Co.
Ltd. (“Shanghai Beiyi”) (b) 9,887,944.98 - 1,302,243.09 - - - - 11,190,188.07 -
Shanghai Liyi Pharmacy Co., Ltd.
(“Shanghai Liyi”) (c) 1,039,039.88 - 108,908.42 - - - - 1,147,948.30 -
Shanghai Renbei Pharmacy Co., Ltd.
(“Shanghai Renbei”) (d) 1,800,000.00 665,103.92 - - - - 2,465,103.92
Dongyuan Accord Pharmaceutical Chain
Co., Ltd. (“Dongyuan Accord”) (e) 396,638.32 - - - - - - - (396,638.32)
Sinopharm Jienuo Medical Treatment
Service Guangdong Co., Ltd.
(“Guangdong Jienuo”) (f) 6,453,679.96 (1,228,109.84) - - - - 5,225,570.12 -
Guangdong Jianhui Construction
Investment Management Co., Ltd.
(“Guangdong Jianhui”) (g) 1,854,647.81 6,000,000.00 145,352.19 - - - - 8,000,000.00 -
Zhijun Suzhou (h) 1,857,279.52 - - - - - - - (1,857,279.52)
Sinopharm Group Zhijun (Shenzhen)
Pharmaceutical Co., Ltd. (“Zhijun
Medicine”) (i) 400,578,574.68 - 78,197,322.08 - - (53,218,071.65) - 425,557,825.11 -
Shenzhen Zhijun Pharmaceutical Trade
Co., Ltd. (“Zhijun Trade”) (i) 10,275,257.61 - 1,176,564.36 - - (1,043,146.79) - 10,408,675.18 -
Sinopharm Group Zhijun (Shenzhen)
PingShan Pharmaceutical Co., Ltd.
(“Zhijun Pingshan”) (i) 120,878,018.74 - 76,785,503.04 - - (21,096,725.88) - 176,566,795.90 -
Shanghai Shyndec Pharmaceutical Co.,
Ltd. (“Shyndec Pharma”) (i) 1,235,240,098.79 - 105,623,439.79 5,332.87 (393,875.73) (16,714,220.20) - 1,323,760,775.52 -
Shanghai Dingqun (j) 22,637,781.16 (22,637,781.16) - - - - - - -
2,107,368,328.72 (16,637,781.16) 354,345,705.65 5,332.87 (393,875.73) (155,414,164.52) - 2,287,019,627.99 (2,253,917.84)
196
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
10. Long-term equity investments (Continued)
2019
Changes in the year
Amount of
Investee 1 January 2019 Additional / Profit or loss under Changes in other Other changes Cash dividends or Provision for 31 December 2019 provision for
reductive the equity method comprehensive income in equity profits declared for impairment impairment
Investment distribution
Main Luck Pharmaceutical (a) 265,316,653.68 - 87,216,213.59 - - (58,063,500.00) - 294,469,367.27 -
Shanghai Beiyi (b) 11,029,918.10 - 987,426.88 - - (2,129,400.00) - 9,887,944.98 -
Shanghai Liyi (c) 955,428.23 - 83,611.65 - - - - 1,039,039.88 -
Shanghai Renbei (d) - 1,800,000.00 - - - - - 1,800,000.00 -
Dongyuan Accord (e) 396,638.32 - - - - - - - (396,638.32)
Guangdong Jienuo (f) 6,802,156.19 1,740,000.00 (2,088,476.23) - - - - 6,453,679.96 -
Guangdong Jianhui (g) - 2,000,000.00 (145,352.19) - - - - 1,854,647.81 -
Zhijun Suzhou (h) 23,379,018.92 - (21,521,739.40) - - - (1,857,279.52) - (1,857,279.52)
Zhijun Medicine (i) 355,353,196.15 - 106,436,143.29 - - (61,210,764.76) - 400,578,574.68 -
Zhijun Trade (i) 8,730,994.87 - 2,318,103.99 - - (773,841.25) - 10,275,257.61 -
Zhijun Pingshan (i) 86,292,927.33 - 46,881,613.08 - - (12,296,521.67) - 120,878,018.74 -
Shyndec Pharma (i) 1,098,566,852.51 - 111,498,302.56 (133,366.19) 42,022,530.06 (16,714,220.15) - 1,235,240,098.79 -
Shanghai Dingqun (j) 23,966,640.12 - (493,944.35) - - (834,914.61) - 22,637,781.16 -
1,880,790,424.42 5,540,000.00 331,171,902.87 (133,366.19) 42,022,530.06 (152,023,162.44) (1,857,279.52) 2,105,114,410.88 (2,253,917.84)
197
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
10. Long-term equity investments (Continued)
(a) On 4 July 1990, the Group jointly established Main Luck Pharmaceutical with Mercian Kabushiki
Kaisha and Main Life Co., Ltd., subscribing 35.19%, 34.15% and 30.66% of shareholdings,
respectively. According to the Articles of Association, the board of directors of Main Luck
Pharmaceutical consisted of six directors, of which two were appointed by the Group, accounting for
33.33% of voting rights. Therefore, the Group had significant influence over Main Luck
Pharmaceutical, and thus, it was considered as an associate of the Group.
(b) On 26 July 1994, the Group jointly established Shanghai Beiyi with Shanghai Beiyi (Group) Co., Ltd.
and eight natural persons including Fuchun Zhu, with the share percentages being 26%, 26% and
48%, respectively. According to the Articles of Association, the board of directors of Shanghai Beiyi
consisted of seven directors, of which two were appointed by the Group, accounting for 28.57% of
voting rights. Therefore, the Group had significant influence over Shanghai Beiyi, and thus, it was
considered as an associate of the Group.
(c) On 25 November 2003, the Group jointly established Shanghai Liyi with Shanghai Pudong District
Central Hospital and Shanghai Liyi, with the share percentages being 35%, 35% and 30%,
respectively. According to the Articles of Association, the board of directors of Shanghai Liyi
consisted of five directors, of which two were appointed by the Group, accounting for 40.00% of
voting rights. Therefore, the Group had significant influence over Shanghai Liyi, and thus, it was
considered as an associate of the Group.
(d) On 5 March 2019, the Group acquired 30% shares of Shanghai Renbei. According to the Articles of
Association, the board of directors of Shanghai Renbei was composed of three directors, one of
whom was appointed by the Group, accounting for 33.33% of voting rights. Therefore, the Group has
significant influence over Shanghai Renbei, and thus, it is considered as an associate of the Group.
(e) In 2007, Dongyuan Accord, an associate of the Group, operated in poor conditions and its future
operation would be significantly uncertain, so the Group made a full provision for impairment of the
long-term equity investment on it.
(f) On 23 February 2016, the Group jointly established Guangdong Jienuo with Sinopharm Jienuo
Medical Treatment Service Co., Ltd. and Guangzhou Jinluo Investment Development Co., Ltd., with
the share percentages being 29%, 51% and 20%, respectively. According to the Articles of
Association, the board of directors of Guangdong Jienuo was composed of five directors, one of
whom was appointed by the Group, accounting for 20% of voting rights. Therefore, the Group has
significant influence over Guangdong Jienuo, and thus, it is considered as an associate of the Group.
On 25 July 2019, the Group, together with the current shareholders, Sinopharm Jienuo Medical
Treatment Service Co., Ltd. and Foshan Jiejianchengfeng Medical Equipment Co., Ltd., increased
the capital of Guangdong Jienuo by 29%, 51% and 20% according to the shareholding ratio
respectively, and the total amount of the increased capital was RMB6 million.
198
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
10. Long-term equity investments (Continued)
(g) On 23 November 2018, the Group jointly established Guangdong Jianhui with Guangdong
Construction Engineering Group Co., Ltd., Suixi People's Hospital and Guangdong Jianke
Architectural Design Institute Co., Ltd., with the share percentages being 10%, 79.90%, 10% and
0.10%, respectively. The registered capital of the company was RMB20,000 thousand. On 22 March
2019, the Group completed the investment of RMB2,000 thousand. According to the Articles of
Association, the board of directors of Guangdong Jianhui was composed of five directors, one of
whom was appointed by the Group, accounting for 20% of voting rights. Therefore, the Group has
significant influence over Guangdong Jianhui, and thus, it is considered as an associate of the
Group. On 30 March 2020, the Group made an additional investment of RMB6 million in Guangdong
Jianhui according to the shareholding ratio.
(h) The Group disposed of its 67% equity interest of Zhijun Suzhou in April 2016. After the disposal, the
Group held a 33% equity interest of Zhijun Suzhou. According to the Articles of Association, the
board of directors of Zhijun Suzhou was composed of five directors, one of whom was appointed by
the Group, accounting for 20% of voting rights. As a result, the Group has significant influence over
Zhijun Suzhou, and thus, it is considered as an associate of the Group. In 2019, on account of
mismanagement, there was significant uncertainty in the future operation of the Group's affiliated
enterprise, Zhijun Suzhou. Thus, the Group made full provision for impairment of the long-term
equity investment in Zhijun Suzhou.
(i) The Group subscribed 15.56% of new issued shares of Shyndec Pharma, a related party, by
transferring the productive assets in Pingshan base and its 51% equity interest of three
pharmaceutical companies (Zhijun Medicines, Zhijun Trade, Zhijun Pingshan) of the Group in 2016,
respectively. After the completion of the reorganization, Shyndec Pharma holds a 51% equity
interest of each of the three pharmaceutical companies, and the Group holds a 49% equity interest
of each of the three pharmaceutical companies, and they have significant influence over the three
pharmaceutical companies.
At the same time, after the completion of the reorganization, the Group holds a 15.56% equity
interest of Shyndec Pharma. Since Shyndec Pharma acquired the shares of subsidiaries with
share-based payment in previous years, as at 31 December 2020, the Group held a 16.28% equity
interest of Shyndec Pharma. Shyndec Pharma set up a board of directors that was responsible for
the shareholders' meeting, with a total of nine members, among which, one was appointed by the
Group. Each director shall represent one vote for resolutions of the board, accounting for 11.11% of
the voting rights. The Group has significant influence over Shyndec Pharma. The above three
pharmaceutical companies and Shyndec Pharma are considered as associates of the Group.
(j) On May 2018, the Company jointly established Shanghai Dingqun with Ningbo Meishan Bonded
Port Area Qiling Equity Investment Center LP, subscribing 2.53% and 97.47% of shareholdings,
respectively. According to the Articles of Association, the board of directors of Shanghai Dingqun
consisted of three directors and one of them was appointed by the Company. Each director shall
represent one vote on the board’s decisions, which shall be adopted if they are voted for by a simple
majority of all the members of the board. Therefore, the Group has significant influence over
Shanghai Dingqun, and thus, it is considered as an associate of the Group. Guoda Drugstore, a
subsidiary of the Group, acquired 100% shares of Shanghai Dingqun Enterprise Management
Consulting Co., Ltd. from Ningbo Meishan Bonded Port Area Qiling Equity Investment Center LP
and the Company by RMB934,240,000.00. The acquisition was completed on 7 January 2020, and
the Company controlled Shanghai Dingqun and formed a business combination not involving
enterprises under no common control, which was included in the scope of the Company's
consolidation.
199
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
11. Other equity investments
2020
Accumulated fair value Dividend income for the current year Reasons for being designated
changes recorded in other Equity instruments Equity instruments as fair value through other
Fair value
comprehensive income derecognised in that are still held comprehensive income
the current year
Sinopharm Health Online Co., Ltd. 55,056,227.40 67,056,227.40 - - Non-trading equity instrument
Sinopharm Hubei Guoda Pharmacy Co., Ltd. 17,279,788.59 18,279,788.59 - - Non-trading equity instrument
Shanghai Guoda Shuguang Pharmacy Co., Ltd 7,971,316.02 8,242,076.02 - 50,000.00 Non-trading equity instrument
Shanghai Guoren Pharmacy Co., Ltd. 5,393,260.45 5,493,260.45 - 590,538.07 Non-trading equity instrument
Hunan Zhongbai Pharmaceutical Investment 101,987.82 416,987.82 - - Non-trading equity instrument
Co., Ltd.
85,802,580.28 99,488,340.28 - 640,538.07
200
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
11. Other equity instrument investment (Continued)
2019
Accumulated fair value Dividend income for the current year Reasons for being designated as
changes recorded in Equity instruments Equity instruments fair value through other
Fair value
other comprehensive derecognised in that are still held comprehensive income
income the current year
Sinopharm Health Online Co., Ltd. 84,748,000.00 96,748,000.00 - - Non-trading equity instrument
Sinopharm Hubei Guoda Pharmacy Co., Ltd. 3,751,000.00 4,751,000.00 - - Non-trading equity instrument
Shanghai Guoda Shuguang Pharmacy Co., Ltd 8,094,240.00 8,365,000.00 - 50,000.00 Non-trading equity instrument
Shanghai Guoren Pharmacy Co., Ltd. 5,604,000.00 5,704,000.00 - 421,386.60 Non-trading equity instrument
Hunan Zhongbai Pharmaceutical Investment
138,000.00 453,000.00 - - Non-trading equity instrument
Co., Ltd.
102,335,240.00 116,021,000.00 - 471,386.60
201
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
12. Other non-current financial assets
31 December 2020 31 December 201
9
Financial assets at fair value through profit or loss 120,972,350.24 140,000,000.00
As at 31 December 2020, the balance of other non-current financial assets is the fair value of the
Sinopharm CICC medical industry fund (“Industry Fund”) that the Company had subscribed. At the
21st Meeting of the 7th board of directors which held on 6 January 2017, the Company deliberated
and passed the proposal on investment subscription of the Industry Fund and related party
transaction of the company. As a limited partner of Industry Fund, the Company intends to invest
and subscribe for the share of Industry Fund amounted to RMB200 million, which shall be paid in 3
instalments. As at 31 December 2019, the Company has made payments accumulated to RMB140
million. The Company received the withdrawal fund of this project’s principal of RMB19,027,649.76
from Ningbo Meishan Bonded Port Area Qirui Equity Investment Center LP on June 2020.
Since the cash flows obtained by the Company from the investment of the Industry Fund includes
both the contractual cash flows generated by the underlying assets during the investment period
and the cash flows of the disposal of the underlying assets, the contractual cash flows that do not
satisfy the financial assets generated on a specific date are only the payment of interest on the
basis of the outstanding principal amount, and therefore, the Company classifies the investment of
the Industry Fund into financial assets measured at fair value through profit or loss and presents the
investment as other non-current financial assets.
202
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
13. Investment properties
Subsequent measurement under the cost model:
2020
Buildings and constructions Land use rights Total
Original cost
Opening balance 243,610,633.09 22,719,102.03 266,329,735.12
Transfer from fixed assets 200,000.00 - 200,000.00
Transfer to intangible assets - (1,730,283.59) (1,730,283.59)
Transfer to fixed assets (7,407,446.67) - (7,407,446.67)
Disposal or Scrap (10,757,340.64) - (10,757,340.64)
Closing balance 225,645,845.78 20,988,818.44 246,634,664.22
Accumulated
depreciation
and
amortisation
Opening balance (117,940,803.43) (8,188,573.39) (126,129,376.82)
Provision (5,838,206.47) (176,289.33) (6,014,495.80)
Transfer from fixed assets (64,379.86) - (64,379.86)
Transfer to intangible assets - 450,957.64 450,957.64
Transfer to fixed assets 4,649,383.55 - 4,649,383.55
Disposal or Scrap 9,217,627.01 - 9,217,627.01
Closing balance (109,976,379.20) (7,913,905.08) (117,890,284.28)
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 year 114,369,466.58 13,074,913.36 127,444,379.94
At beginning of year 124,369,829.66 14,530,528.64 138,900,358.30
203
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
13. Investment properties (Continued)
Subsequent measurement under the cost model (Continued)
2019
Buildings and constructions Land use rights Total
Original cost
Opening balance 242,555,189.91 22,719,102.03 265,274,291.94
Purchase - - -
Transfer from fixed assets 1,255,443.18 - 1,255,443.18
Transfer to intangible assets - - -
Transfer to fixed assets (200,000.00) - (200,000.00)
Closing balance 243,610,633.09 22,719,102.03 266,329,735.12
Accumulated
depreciation and
amortisation
Opening balance (111,131,166.21) (7,948,629.76) (119,079,795.97)
Provision (6,473,856.29) (239,943.63) (6,713,799.92)
Transfer from fixed assets (395,846.48) - (395,846.48)
Transfer to intangible assets - - -
Transfer to fixed assets 60,065.55 - 60,065.55
Closing balance (117,940,803.43) (8,188,573.39) (126,129,376.82)
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 year 124,369,829.66 14,530,528.64 138,900,358.30
At beginning of year 130,124,023.70 14,770,472.27 144,894,495.97
204
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
13. Investment properties (Continued)
During 2020, depreciation and amortisation of investment properties were RMB6,014,495.80 (2019:
RMB6,713,799.92).
During 2020, properties with a carrying amount of RMB135,620.14 (original value: RMB200,000.00,
accumulated depreciation: RMB64,379.86) were leased out to a third party in the form of operating
leases. Since the date of changing the use of properties, the fixed assets were transferred into
investment properties.
During 2020, properties with a carrying amount of RMB2,758,063.12 (original value:
RMB7,407,446.67, accumulated depreciation: RMB4,649,383.55) were transferred to an
owner-occupied property. Since the date of changing the use of properties, the properties were
reclassified as fixed assets.
As at 31 December 2020, the Group had no investment properties for which certificates of title have
not been obtained.
205
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets
31 December 2020 31 December 2019
Fixed assets 854,191,083.27 708,000,172.63
Disposal of fixed assets - -
854,191,083.27 708,000,172.63
2020
Buildings and Machinery and
constructions equipment Motor vehicles Office equipment Electronic equipment Total
Original cost
Opening balance 603,848,760.59 239,741,250.34 90,023,564.89 322,298,724.55 90,133,289.24 1,346,045,589.61
Purchase 1,301,861.39 69,349,747.46 13,341,082.06 39,992,959.88 36,812,781.74 160,798,432.53
Transfer from construction in progress 1,455,115.63 3,321,029.79 - 20,296.00 - 4,796,441.42
Transfer from investment properties 7,407,446.67 - - - - 7,407,446.67
Business combination not involving enterprises under common control 93,390,680.73 1,975,018.76 3,873,907.17 16,236,211.94 10,210,548.23 125,686,366.83
Transfer to investment properties (200,000.00) - - - - (200,000.00)
Disposal or retirement (2,564,468.58) (8,936,383.71) (10,486,836.65) (12,905,979.37) (16,087,635.21) (50,981,303.52)
Closing balance 704,639,396.43 305,450,662.64 96,751,717.47 365,642,213.00 121,068,984.00 1,593,552,973.54
206
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
2020
Buildings and Machinery and
constructions equipment Motor vehicles Office equipment Electronic equipment Total
Accumulated depreciation
Opening balance (210,725,255.48) (114,086,892.23) (58,060,958.31) (195,644,163.28) (59,528,147.68) (638,045,416.98)
Provision (24,493,901.95) (40,831,522.87) (8,724,407.96) (29,263,986.69) (30,393,164.67) (133,706,984.14)
Transfer from investment properties (4,649,383.55) - - - - (4,649,383.55)
Transfer to investment properties 64,379.86 - - - - 64,379.86
Disposal or retirement 1,380,170.07 6,676,259.86 8,450,094.96 8,340,010.37 12,128,979.28 36,975,514.54
Closing balance (238,423,991.05) (148,242,155.24) (58,335,271.31) (216,568,139.60) (77,792,333.07) (739,361,890.27)
Provision for impairment
Opening balance - - - - - -
Closing balance - - - - - -
Carrying amount
At end of year 466,215,405.38 157,208,507.40 38,416,446.16 149,074,073.40 43,276,650.93 854,191,083.27
At beginning of year 393,123,505.11 125,654,358.11 31,962,606.58 126,654,561.27 30,605,141.56 708,000,172.63
207
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
2019
Buildings and Machinery and
constructions equipment Motor vehicles Office equipment Electronic equipment Total
Original cost
Opening balance 608,461,117.25 186,208,319.61 92,636,715.94 299,947,605.66 68,789,409.65 1,256,043,168.11
Purchase 285,469.52 47,195,352.32 12,707,239.39 27,449,401.75 34,397,180.00 122,034,642.98
Transfer from construction in progress - 8,769,821.87 - 878,820.54 527,569.85 10,176,212.26
Transfer from investment properties 200,000.00 - - - - 200,000.00
Business combination not involving enterprises under common control - 196,365.43 365,001.36 322,978.10 608,679.42 1,493,024.31
Transfer to investment properties (1,255,443.18) - - - - (1,255,443.18)
Disposal of subsidiaries - - (305,010.00) (298,683.01) (124,535.84) (728,228.85)
Disposal or retirement (3,842,383.00) (2,628,608.89) (15,380,381.80) (6,001,398.49) (14,065,013.84) (41,917,786.02)
Closing balance 603,848,760.59 239,741,250.34 90,023,564.89 322,298,724.55 90,133,289.24 1,346,045,589.61
Accumulated depreciation
Opening balance (187,646,986.94) (85,707,014.98) (61,269,176.57) (175,318,733.63) (48,947,691.25) (558,889,603.37)
Provision (23,596,570.19) (30,534,710.78) (8,573,425.40) (24,908,016.13) (23,283,070.58) (110,895,793.08)
Transfer from investment properties (60,065.55) - - - - (60,065.55)
Transfer to investment properties 395,846.48 - - - - 395,846.48
Recovered from disposal of subsidiaries - - 298,484.02 136,696.63 52,796.55 487,977.20
Disposal or retirement 182,520.72 2,154,833.53 11,483,159.64 4,445,889.85 12,649,817.60 30,916,221.34
Closing balance (210,725,255.48) (114,086,892.23) (58,060,958.31) (195,644,163.28) (59,528,147.68) (638,045,416.98)
208
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
2019 (Continued)
Buildings and Machinery and
Motor vehicles Office equipment Electronic equipment Total
constructions equipment
Provision for impairment
Opening balance - - - - - -
Closing balance - - - - - -
Carrying amount
At end of year 393,123,505.11 125,654,358.11 31,962,606.58 126,654,561.27 30,605,141.56 708,000,172.63
At beginning of year 420,814,130.31 100,501,304.63 31,367,539.37 124,628,872.03 19,841,718.40 697,153,564.74
209
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
As at 31 December 2020 and 31 December 2019, the Group has not owned any fixed assets for operating
leases.
As at 31 December 2020, the fixed assets falling to accomplish certification of title are presented as follows:
Book value Reason for not accomplishing certification of title
As at 31 December 2020, the Group has not yet obtained the
certification of title for No.13 Jingxing North Street, Tiexi District,
Shenyang. The transferor, the State-owned Assets Supervision
and Administration Commission of Tiexi District, Shenyang, was
Buildings and constructions 25,424,260.88 still processing the case and had provided a relevant notification.
As at 31 December 2020, the Group has not yet obtained the
certification of title for No.53 Nanshi Zhong Road, Tiexi District,
Shenyang. The transferor, the State-owned Assets Supervision
and Administration Commission of Tiexi District, Shenyang, was
Buildings and constructions 41,290,701.04 still processing the case and had provided a relevant notification.
As at 31 December 2020, the Group failed to apply the property
right certification of the title for No.31 Yihe Road, Kaiyuan, Tieling
as the construction area is larger than the approved area but it has
Buildings and constructions 656,966.76 been provided a certification of construction completion.
As at 31 December 2020, the Group had built a simple warehouse
located at No.2 Baiyu Road, Sujiatun District, Shenyang for
self-storage. The Group failed to accomplish the property right
Buildings and constructions 119,844.81 certification of the warehouse.
As at 31 December 2020 and 31 December 2019, no fixed assets were temporarily idle.
210
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
15. Construction in progress
31 December 2020 31 December 2019
Construction in progress 46,631,190.23 31,582,575.84
31 December 2020 31 December 2019
Carrying balance Impairment Carrying amount Carrying balance Impairment Carrying amount
Warehouse improvement project 2,357,739.84 - 2,357,739.84 1,232,957.94 - 1,232,957.94
New office building project 2,654,403.71 - 2,654,403.71 110,090.53 - 110,090.53
Supply chain extension project 12,248,729.81 - 12,248,729.81 8,081,340.80 - 8,081,340.80
Software project 19,443,779.83 - 19,443,779.83 13,197,683.52 - 13,197,683.52
Other projects 9,926,537.04 - 9,926,537.04 8,960,503.05 - 8,960,503.05
46,631,190.23 - 46,631,190.23 31,582,575.84 - 31,582,575.84
211
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
15. Construction in progress (Continued)
Changes of significant items of construction in progress in 2020 are presented as follows:
Proportion of
Source of
Decrease At end of year investment to
funds
At beginning of the budget (%)
Project name Increase
year Transferred to fixed Transferred to Transferred to Other
assets intangible assets long-term prepaid
expense
Self-raised
Warehouse improvement project 1,232,957.94 6,287,811.88 (2,511,667.25) - (2,651,362.73) - 2,357,739.84 funds 93.29
Self-raised
New office building project 110,090.53 2,685,041.41 - - (140,728.23) - 2,654,403.71 funds 66.53
Self-raised
Supply chain extension project 8,081,340.80 6,452,163.18 (2,284,774.17) - - - 12,248,729.81 funds 57.29
Self-raised
Software project 13,197,683.52 19,443,779.83 - (13,197,683.52) - - 19,443,779.83 funds 100.00
Self-raised
Other construction projects 8,960,503.05 3,391,463.10 - - (2,425,429.11) - 9,926,537.04 funds 5.97
31,582,575.84 38,260,259.40 (4,796,441.42) (13,197,683.52) (5,217,520.07) - 46,631,190.23
212
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
15. Construction in progress (Continued)
Changes of significant items of construction in progress in 2020 are presented as follows: (Continued)
2020
Project name Project budget Project Accumulated Including: borrowings Capitalization rate (%)
progress amount of capitalised in the current year
（%） borrowings
capitalised
Warehouse improvement project 6,910,764.45 93.29 - - -
New office building project 4,080,919.77 66.53 - - -
Supply chain extension project 29,065,907.09 57.29 - - -
Software project 19,443,779.83 100.00 - - -
Other construction projects 208,542,337.64 5.97 - - -
- -
213
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
15. Construction in progress (Continued)
Changes of significant items of construction in progress in 2019 are presented as follows:
Proportion of
Source of
Increase Decrease At end of year investment to
funds
Project name At beginning of the year budget (%)
Transferred to Transferred to Transferred to long-term Other
fixed assets intangible assets prepaid expense
Self-raised
Warehouse improvement project 806,272.40 3,859,186.68 (1,143,477.76) - (2,289,023.38) - 1,232,957.94 funds 67.37
Self-raised
New office building project 188,251.26 110,090.53 - - (188,251.26) - 110,090.53 funds 43.33
Self-raised
Supply chain extension project 12,617,953.89 8,728,170.28 (8,459,732.15) (4,245,282.90) - (559,768.32) 8,081,340.80 funds 71.99
Self-raised
Software project 12,930,498.53 13,216,765.17 (45,432.50) (12,904,147.68) - - 13,197,683.52 funds 99.98
Self-raised
Other construction projects 13,657,195.15 4,647,151.73 (527,569.85) - (8,816,273.98) - 8,960,503.05 funds 8.89
40,200,171.23 30,561,364.39 (10,176,212.26) (17,149,430.58) (11,293,548.62) (559,768.32) 31,582,575.84
214
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
15. Construction in progress (Continued)
Changes of significant items of construction in progress in 2019 are presented as follows: (Continued)
2019
Project name Project budget Project Accumulated Including: borrowings Capitalization rate (%)
progress amount of capitalised in the current year
（%） borrowings
capitalised
Warehouse improvement project 7,008,129.53 67.37 - - -
New office building project 688,251.26 43.33 - - -
Supply chain extension project 30,933,538.69 71.99 - - -
Software project 26,151,831.20 99.98 - - -
Other construction projects 214,717,560.34 8.89 - - -
- -
215
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets
2020
Buildings Machinery, transport and office
and constructions equipment Others Total
Cost
Opening balance 2,634,697,656.23 14,470,094.95 2,418,809.35 2,651,586,560.53
Increase 992,942,597.22 98,521.31 - 993,041,118.53
Business combinations involving enterprises not under common
control 463,952,931.93 - - 463,952,931.93
Disposal (448,866,616.81) (7,951,563.71) - (456,818,180.52)
Closing balance 3,642,726,568.57 6,617,052.55 2,418,809.35 3,651,762,430.47
Accumulated amortisation
Opening balance (652,657,513.16) (4,075,450.60) (95,734.70) (656,828,698.46)
Accrual (863,616,827.21) (3,712,235.62) (95,996.99) (867,425,059.82)
Disposal 226,748,325.54 2,695,395.26 - 229,443,720.80
Closing balance (1,289,526,014.83) (5,092,290.96) (191,731.69) (1,294,810,037.48)
216
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets (Continued)
2020 (Continued)
Buildings and constructions Machinery, transport and office equipment Others Total
Provision for impairment
Opening balance - - - -
Closing balance - - - -
Book value
The end of the year 2,353,200,553.74 1,524,761.59 2,227,077.66 2,356,952,392.99
The beginning of year 1,982,040,143.07 10,394,644.35 2,323,074.65 1,994,757,862.07
217
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets (Continued)
2019
Buildings Machinery, transport and office
and constructions equipment Others Total
Cost
Opening balance 1,855,407,171.78 14,379,897.19 2,418,809.35 1,872,205,878.32
Increase 828,846,845.51 90,197.76 - 828,937,043.27
Disposal (49,556,361.06) - - (49,556,361.06)
Closing balance 2,634,697,656.23 14,470,094.95 2,418,809.35 2,651,586,560.53
Accumulated amortisation
Opening balance - - - -
Accrual (663,858,311.28) (4,075,450.60) (95,734.70) (668,029,496.58)
Disposal 11,200,798.12 - - 11,200,798.12
Closing balance (652,657,513.16) (4,075,450.60) (95,734.70) (656,828,698.46)
218
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets (Continued)
2019 (Continued)
Buildings and constructions Machinery, transport and office equipment Others Total
Provision for impairment
Opening balance - - - -
Closing balance - - - -
Book value
The end of the year 1,982,040,143.07 10,394,644.35 2,323,074.65 1,994,757,862.07
The beginning of year 1,855,407,171.78 14,379,897.19 2,418,809.35 1,872,205,878.32
219
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets
31 December 2020 31 December 2019
Intangible assets 734,345,179.40 374,788,799.48
Trademarks and Favourable Distribution
2020 Land use rights Software brands use rights leases network Franchise Total
Original cost
Opening balance 62,083,143.97 175,625,594.44 92,349,850.00 127,486,000.00 112,117,142.86 710,000.00 570,371,731.27
Purchase - 7,672,816.94 - - - - 7,672,816.94
Business combination not involving enterprises under common control 24,880,950.20 2,142,366.10 189,687,075.12 - 171,456,535.38 - 388,166,926.80
Transfer from construction in progress - 13,197,683.52 - - - - 13,197,683.52
Transfer from investment properties 1,730,283.59 - - - - - 1,730,283.59
Disposal - (340,230.80) - - - - (340,230.80)
Closing balance 88,694,377.76 198,298,230.20 282,036,925.12 127,486,000.00 283,573,678.24 710,000.00 980,799,211.32
Accumulated amortisation
Opening balance (28,858,577.16) (88,726,743.09) (196,850.16) (30,792,570.91) (46,298,190.47) (710,000.00) (195,582,931.79)
Provision (1,355,326.17) (22,774,318.72) (4,863,933.65) (7,085,955.88) (14,680,838.87) - (50,760,373.29)
Transfer from investment properties (450,957.64) - - - - - (450,957.64)
Disposal - 340,230.80 - - - - 340,230.80
Closing balance (30,664,860.97) (111,160,831.01) (5,060,783.81) (37,878,526.79) (60,979,029.34) (710,000.00) (246,454,031.92)
220
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets (Continued)
Trademarks and
2020 (Continued) Land use rights Software brands use rights Favourable leases Distribution network Franchise Total
Provision for impairment
Opening balance - - - - - - -
Closing balance - - - - - - -
Carrying amount
At end of the year 58,029,516.79 87,137,399.19 276,976,141.31 89,607,473.21 222,594,648.90 - 734,345,179.40
At beginning of the year 33,224,566.81 86,898,851.35 92,152,999.84 96,693,429.09 65,818,952.39 - 374,788,799.48
221
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets (Continued)
Trademarks and
brands use Favourable Distribution
2019 Land use rights Software rights leases network Franchise Total
Original cost
Opening balance 62,083,143.97 144,044,859.13 92,349,850.00 127,486,000.00 112,117,142.86 710,000.00 538,790,995.96
Purchase - 13,542,842.51 - - - - 13,542,842.51
Business combination not involving enterprises under common control - 888,462.22 - - - - 888,462.22
Transfer from construction in progress - 17,149,430.58 - - - - 17,149,430.58
Closing balance 62,083,143.97 175,625,594.44 92,349,850.00 127,486,000.00 112,117,142.86 710,000.00 570,371,731.27
Accumulated amortisation
Opening balance (27,889,638.96) (69,651,524.60) (196,850.16) (23,349,906.70) (40,692,333.33) (710,000.00) (162,490,253.75)
Provision (968,938.20) (19,075,218.49) - (7,442,664.21) (5,605,857.14) - (33,092,678.04)
Closing balance (28,858,577.16) (88,726,743.09) (196,850.16) (30,792,570.91) (46,298,190.47) (710,000.00) (195,582,931.79)
222
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets (Continued)
Trademarks and
brands use Favourable Distribution
2019 (Continued) Land use rights Software rights leases network Franchise Total
Provision for impairment
Opening balance - - - - - - -
Closing balance - - - - - - -
Carrying amount
At end of the year 33,224,566.81 86,898,851.35 92,152,999.84 96,693,429.09 65,818,952.39 - 374,788,799.48
At beginning of the year 34,193,505.01 74,393,334.53 92,152,999.84 104,136,093.30 71,424,809.53 - 376,300,742.21
As at 31 December 2020 and 31 December 2019, no intangible assets were formed through internal research and development.
As at 31 December 2020 and 31 December 2019, no intangible assets’ certificates of title have not been obtained.
223
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
18. Goodwill
Decrease
Increase during the year
Closing
2020 Opening balance Merger of holdings not Business combinations balance
under common not under common
control control
Pharmaceutical distribution
Sinopharm Holding (Jiangmen) Co.,
Ltd. (“Sinopharm Jiangmen”) 27,392,317.73 - - - 27,392,317.73
Sinopharm Holding Shenzhen
Yanfeng Co., Ltd. (“Sinopharm
Yanfeng”) 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
Pharmaceutical retail
Sinopharm Hebei Lerentang
Pharmacy Chain Store Co., Ltd.
(“Hebei Lerentang”) 29,482,149.57 - - - 29,482,149.57
Xiaoyi Guoda Wanmin Baicaotang
Pharmacy Chain Store Co., Ltd.
(“Xiaoyi Wanmin”) 15,866,680.00 - - - 15,866,680.00
Shanxi Guoda Wanmin Pharmacy
Chain Store Co., Ltd. (“Shanxi
Wanmin”) 65,025,000.00 - - - 65,025,000.00
Sinopharm Holding Guoda ForMe
Pharmacy Chain Store Shanghai
Co., Ltd. (“ForMe Pharmacy
Chain Store”) 19,405,450.23 - - - 19,405,450.23
Sinopharm Holding Guoda
Pharmacy Chain Store Shanghai
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
Sinopharm Holding Guoda Nanjing
Pharmacy Chain Store Co., Ltd. 11,598,341.12 - - - 11,598,341.12
224
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
Decrease
Increase during the year
Closing
2020 (Continued) Opening balance Merger of holdings not Business combinations balance
under common not under common
control control
Pharmaceutical retail (Continued)
Fujian Guoda Pharmacy Chain Store
Co., Ltd. 1,567,250.76 - - - 1,567,250.76
Sinopharm Holding Guoda
Shandong Pharmacy Chain Store
Co., Ltd. 29,110,409.46 - - - 29,110,409.46
Sinopharm Holding Guoda
Shenyang Pharmacy Chain Store
Co., Ltd. (“Guoda Shenyang”) 41,047,958.08 - - - 41,047,958.08
Liyang Guoda People Pharmacy
Chain Store Co., Ltd. 107,275,095.74 - - - 107,275,095.74
Sinopharm Holding Hunan Guoda
Minshengtang Pharmacy Chain
Co., Ltd. 41,165,574.64 - - - 41,165,574.64
Quanzhou Guoda Pharmacy Chain
Store Co., Ltd. (“Guoda
Quanzhou”) 41,298,622.59 - - - 41,298,622.59
Sinopharm Holding Guoda Henan
Pharmacy Chain Store Co., Ltd. 22,666,179.77 - - - 22,666,179.77
Guoda Inner Mongolia 70,485,777.00 - - - 70,485,777.00
Sinopharm Guoda Pharmacy
Jiangmen Chain Co., Ltd. 77,350,000.00 - - - 77,350,000.00
Sinopharm Holding Guoda Shanxi
Yiyuan Pharmacy Chain Store
Co., Ltd. 9,080,100.00 - - - 9,080,100.00
Shenzhen Guanganli Pharmacy
Chain Store Co., Ltd. store
acquisition 13,420,000.00 - - - 13,420,000.00
Beijing Golden Elephant Pharmacy
Medicine Chain Company Limited 64,140,124.36 - - - 64,140,124.36
Guoda Taishan 26,826,120.55 - - - 26,826,120.55
Sinopharm Guoda Taiyuan Tongxinli
Pharmacy Co., Ltd. (“Taiyuan
Tongxinli”) 2,818,647.85 - - - 2,818,647.85
Chaoyang Yongxingtang Pharmacy
Chain Store Co., Ltd. (“Chaoyang
Yongxingtang”) stores’ acquisition 25,973,399.17 - - - 25,973,399.17
Inner Mongolia Tongren Pharmacy
Chain Store Co., Ltd. (“Inner
Mongolia Tongren”) stores’
acquisition 13,494,000.00 - - - 13,494,000.00
Guoda Pu’er 71,064,684.79 - - - 71,064,684.79
Shanghai Pudong New Area
Medicine & Medication Co., Ltd.
(“Pudong Medicine”) 65,978,042.61 - - - 65,978,042.61
Shanghai Dingqun - 520,836,246.17 - - 520,836,246.17
Chengda Fangyuan Pharmaceutical
Group Co., Ltd. (“CDFY”) - 1,182,443,676.11 - - 1,182,443,676.11
Liaoning Xianzhen Pharmaceutical
Chain Co., Ltd. (“Liaoning
Xianzhen”) stores’ acquisition - - 34,037,431.66 - 34,037,431.66
1,035,057,927.17 1,703,279,922.28 34,037,431.66 - 2,772,375,281.11
225
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
Decrease during
Increase the year
2019 Merger of holdings not Closing
Opening balance Business combinations
under common balance
not under common
control control
Pharmaceutical distribution
Sinopharm Jiangmen 27,392,317.73 - - - 27,392,317.73
Sinopharm Yanfeng 16,868,644.87 - - - 16,868,644.87
Sinopharm Zhaoqing 2,594,341.53 - - - 2,594,341.53
Sinopharm Shaoguan 1,686,496.80 - - - 1,686,496.80
Sinopharm Meizhou 1,610,819.66 - - - 1,610,819.66
Sinopharm Huizhou 923,184.67 - - - 923,184.67
Sinopharm Zhanjiang 282,135.55 - - - 282,135.55
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 Zhuhai 6,772,561.47 6,772,561.47
Sinopharm Maoming 66,417.07 - - - 66,417.07
ForMe Medicines 3,033,547.53 - - - 3,033,547.53
Pharmaceutical retail
Hebei Lerentang 29,482,149.57 - - - 29,482,149.57
Xiaoyi Wanmin 15,866,680.00 - - - 15,866,680.00
Shanxi Wanmin 65,025,000.00 - - - 65,025,000.00
ForMe Pharmacy Chain Store 19,405,450.23 - - - 19,405,450.23
Sinopharm Holding Guoda
Pharmacy Chain Store
Shanghai 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
Sinopharm Holding Guoda Nanjing
Pharmacy Chain Store Co., Ltd. 11,598,341.12 - - - 11,598,341.12
Fujian Guoda Pharmacy Chain
Store Co., Ltd. 1,567,250.76 - - - 1,567,250.76
Sinopharm Holding Guoda
Shandong Pharmacy Chain Store
Co., Ltd. 29,110,409.46 - - - 29,110,409.46
Guoda Shenyang 41,047,958.08 - - - 41,047,958.08
Liyang Guoda People Pharmacy
Chain Store Co., Ltd. 107,275,095.74 - - - 107,275,095.74
Sinopharm Holding Hunan Guoda
Minshengtang Pharmacy Chain
Co., Ltd. 41,165,574.64 - - - 41,165,574.64
Guoda Quanzhou 41,298,622.59 - - - 41,298,622.59
Sinopharm Holding Guoda Henan
Pharmacy Chain Store Co., Ltd. 22,666,179.77 - - - 22,666,179.77
Guoda Inner Mongolia 70,485,777.00 - - - 70,485,777.00
Sinopharm Guoda Pharmacy
Jiangmen Chain Co., Ltd. 77,350,000.00 - - - 77,350,000.00
Sinopharm Holding Guoda Shanxi
Yiyuan Pharmacy Chain Store
Co., Ltd. 9,080,100.00 - - - 9,080,100.00
Shenzhen Guanganli Pharmacy
Chain Store Co., Ltd. store
acquisition 13,420,000.00 - - - 13,420,000.00
Beijing Golden Elephant Pharmacy
Medicine Chain Company Limited 64,140,124.36 - - - 64,140,124.36
226
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
Decrease
Increase during the year
2019 (Continued) Opening balance Merger of holdings not Business combinations
under common control not under common Closing balance
control
Pharmaceutical retail (Continued)
Guoda Taishan 26,826,120.55 - - - 26,826,120.55
Taiyuan Tongxinli 2,818,647.85 - - - 2,818,647.85
Chaoyang Yongxingtang stores’
acquisition - - 25,973,399.17 - 25,973,399.17
Inner Mongolia Tongren stores’
acquisition - - 13,494,000.00 - 13,494,000.00
Guoda Pu’er - 71,064,684.79 - - 71,064,684.79
Pudong Medicine 65,978,042.61 - - - 65,978,042.61
924,525,843.21 71,064,684.79 39,467,399.17 - 1,035,057,927.17
Changes in provision for impairment of goodwill are presented as follows:
2020 Opening balance Increase Decrease Closing balance
Provision Disposal
Pharmaceutical retail
Guoda Quanzhou 25,000,000.00 - - 25,000,000.00
2019 Opening balance Increase Decrease Closing balance
Provision Disposal
Pharmaceutical retail
Guoda Quanzhou 25,000,000.00 - - 25,000,000.00
The carrying value of goodwill is apportioned according to the proportion of each asset group or
group of asset groups at the fair value of the total amount of goodwill at fair value. It is shown as
follows:
31 December 2020 31 December 2019
Pharmaceutical distribution 152,865,497.03 152,865,497.03
Pharmaceutical retail 2,594,509,784.08 857,192,430.14
2,747,375,281.11 1,010,057,927.17
227
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
The Company’s subsidiary, Guoda Drugstore, had acquired 100% equity of CDFY in July 2020,
which formed goodwill amounting to RMB1,182,443,676.11. Refer to Note VI (1.2) for more details.
The Company’s subsidiary, Guoda Shenyang, had acquired the operation rights of 43 stores and 11
clinics of Liaoning Xianzhen in March 2020, which formed goodwill amounting to RMB34,037,431.66.
Refer to Note VI (1.4) for more details.
The Company’s subsidiary, Guoda Drugstore, had acquired 100% equity of Shanghai Dingqun in
January 2020, which formed goodwill amounting to RMB520,836,246.17. Refer to Note VI (1.5) for
more details.
The recoverable amount of asset groups or groups of asset groups is determined based on a
financial budget approved by the management covering a five-year period. The cash flows beyond
the five-year period are extrapolated using the inflation rate.
Key assumptions were used to calculate the present values of future cash flow projections of the
asset group consisting of pharmaceutical distribution and pharmaceutical retail on 31 December
2020. Key assumptions made by the management on projections of cash flows used in goodwill
impairment testing are described as follows:
Pharmaceutical distribution Pharmaceutical retail
Revenue growth rate in the budget period 1.79%-16.00% -3.20%-16.43%
Sustainable growth rate 3.00% 3.00%
Gross margin 3.56%-6.40% 12.55%-50.58%
Discount rate 12.40%-15.00% 12.98%-15.00%
The management determined the budgeted gross margin and weight average growth rate based on
the historical performance and market development expectation. The discount rates are used as
pre-tax discount rates reflecting specific risks of the relevant asset groups and groups of asset
groups. The above assumptions are used to analyse the recoverable amount of each asset group
and group of asset groups in the business segment.
228
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
19. Long-term prepaid expenses
2020 Opening balance Increase Amortisation Other decrease Closing balance
Fixed asset improvement
expenditure of operating
leases 289,508,030.05 152,559,690.26 (103,648,906.24) (1,523,656.94) 336,895,157.13
Acquisition expenditure to
obtain the right to operate 56,532,005.51 61,782,068.03 (22,511,751.59) - 95,802,321.95
Others 27,487,932.58 7,479,650.45 (9,951,162.18) (8,623.84) 25,007,797.01
373,527,968.14 221,821,408.74 (136,111,820.01) (1,532,280.78) 457,705,276.09
2019 Opening balance Increase Amortisation Other decrease Closing balance
Fixed asset improvement
expenditure of operating
leases 249,458,261.87 129,417,883.53 (86,397,660.69) (2,970,454.66) 289,508,030.05
Acquisition expenditure to
obtain the right to operate 57,617,166.63 15,785,422.51 (16,870,583.63) - 56,532,005.51
Others 4,253,277.96 28,371,430.56 (5,099,503.83) (37,272.11) 27,487,932.58
311,328,706.46 173,574,736.60 (108,367,748.15) (3,007,726.77) 373,527,968.14
20. Deferred tax assets/liabilities
Deferred tax assets and deferred tax liabilities before offsetting are as follows:
31 December 2020 31 December 2019
Deductible temporary Deferred tax assets Deductible temporary Deferred tax assets
differences differences
Deferred tax assets
Provision for
impairment of
assets 170,577,875.56 40,697,280.41 119,337,381.49 28,279,430.24
Accrued selling
expenses 113,445,282.36 26,095,709.73 101,057,882.46 24,536,658.05
Effect of the lease
standard 93,685,083.09 22,420,179.23 52,885,419.73 12,482,780.70
Membership award
points 59,179,220.98 14,575,814.61 30,048,003.69 7,328,820.57
Accrued payroll 47,280,390.08 11,210,512.95 11,868,705.75 2,454,711.04
Deductible loss 30,798,485.93 7,699,621.49 30,789,517.62 7,536,230.76
Others 21,096,550.78 4,641,850.41 28,617,468.39 6,174,871.53
536,062,888.78 127,340,968.83 374,604,379.13 88,793,502.89
229
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
20. Deferred tax assets/liabilities (Continued)
31 December 2020 31 December 2019
Taxable temporary Deferred tax liabilities Taxable temporary Deferred tax liabilities
differences differences
Deferred tax liabilities
Fair value adjustment
for a business
combination not
involving
enterprises under
common control 713,703,864.68 178,425,966.17 354,297,299.88 88,574,324.96
Fixed asset less than
RMB5 million which
is deducted at once 126,722,799.31 31,679,099.86 77,440,115.98 19,250,299.21
Changes in fair value
of financial assets
through other
comprehensive
income 85,802,580.28 21,450,645.07 102,335,240.00 25,583,810.00
Changes in asset
valuation due to
change in company
policy 17,160,546.40 4,290,136.60 20,286,498.64 5,071,624.66
Others 25,205,927.86 5,297,761.98 26,521,667.38 5,487,577.71
968,595,718.53 241,143,609.68 580,880,821.88 143,967,636.54
Deferred tax assets and liabilities are presented after being offset against each other are as follows:
31 December 2020 31 December 2019
The amount of Deferred tax The amount of Deferred tax
offset assets/liabilities -net offset assets/liabilities-net
Deferred tax assets 35,222,201.02 92,118,767.81 25,682,673.77 63,110,829.12
Deferred tax
liabilities 35,222,201.02 205,921,408.66 25,682,673.77 118,284,962.77
The deductible temporary differences and deductible losses that were not recognised as deferred tax assets
are presented as follows:
31 December 2020 31 December 2019
Deductible temporary differences 9,435,555.39 3,406,025.94
Deductible losses (1) 61,373,403.25 49,106,535.92
70,808,958.64 52,512,561.86
(1) For those loss-making subsidiaries, as it is not considered probable that taxable profits will be available
against which the tax losses can be utilised, the Group has not recognised the deferred tax asset for the
accumulated losses amounting to RMB61,373,403.25 of the deductible taxable income of those
loss-making subsidiaries.
230
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
20. Deferred tax assets/liabilities (Continued)
The deductible losses on unrecognised deferred tax assets will be due in the following years:
31 December 2020 31 December 2019
2020 - 4,725,707.87
2021 2,563,056.08 2,563,056.08
2022 7,261,117.97 7,261,117.97
2023 11,977,477.56 11,977,477.56
2024 22,579,176.44 22,579,176.44
2025 16,992,575.20 -
61,373,403.25 49,106,535.92
21. Other non-current assets
31 December 2020 31 December 2019
Specially approved reserving materials 260,590,932.98 55,550,834.89
Guarantee 114,186,431.57 -
Prepayment for projects and equipment 24,809,091.30 21,713,763.10
Contract assets 6,999,074.72 -
Others 1,611,992.27 90,372.40
408,197,522.84 77,354,970.39
22. Short-term borrowings
31 December 2020 31 December 2019
Credit borrowings 1,612,187,020.12 1,388,979,951.89
Discounted notes receivables - 64,038,348.12
1,612,187,020.12 1,453,018,300.01
As at 31 December 2020, the weighted average annual interest rate of the above borrowings was 3.49% (31
December 2019: 4.44%).
As at 31 December 2020 and 31 December 2019, no short-term borrowings of the Group have matured but
were not yet paid.
231
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
23. Notes payable
31 December 2020 31 December 2019
Commercial acceptance bills 56,360,197.69
40,343,723.78
Bank acceptance bills 7,463,805,077.00 5,515,353,833.75
7,520,165,274.69 5,555,697,557.53
At 31 December 2020 and 31 December 2019, no notes payable of the Group have matured but
were not yet paid.
24. Accounts payable
Accounts payable are interest-free and will be paid normally between 1 and 6 months.
31 December 2020 31 December 2019
Payment for goods 7,697,451,142.50 6,703,967,826.54
At 31 December 2020, significant accounts payable aged over one year were analysed below:
Amount Reason
Payment for goods 398,772,102.49 Not yet settled
25. Advanced receivables
31 December 2020 31 December 2019
Advanced lease payment 12,352,466.64 544,372.73
26. Contract liabilities
31 December 2020 31 December 2019
Contract liabilities 368,600,357.14 302,650,567.97
The ending balance of contract liabilities is the advance payments received by the Group. After the
Group receives the advance payments by the customer for the sales of goods, it will generally
perform the performance obligation and recognise the revenue within about 6 months.
232
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable
2020 At beginning of Increase Decrease At end of the
the year year
Short-term employee
benefits 254,250,943.71 2,659,830,539.44 (2,566,478,507.29) 347,602,975.86
Post-employment benefits
(defined contribution
plan) 5,057,047.69 122,670,266.27 (118,511,109.47) 9,216,204.49
Termination benefits 332,821.70 1,044,714.24 (984,669.19) 392,866.75
259,640,813.10 2,783,545,519.95 (2,685,974,285.95) 357,212,047.10
2019 At beginning of Increase Decrease At end of the
the year year
Short-term employee
benefits 234,513,542.42 2,077,879,749.97 (2,058,142,348.68) 254,250,943.71
Post-employment benefits
(defined contribution
plan) 5,643,440.87 191,419,979.31 (192,006,372.49) 5,057,047.69
Termination benefits 465,851.14 1,462,273.12 (1,595,302.56) 332,821.70
240,622,834.43 2,270,762,002.40 (2,251,744,023.73) 259,640,813.10
233
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable (Continued)
Short-term employee benefits:
2020 At beginning of Increase Decrease At end of year
year
Salaries, bonuses, allowances and
grants 240,039,850.54 2,339,888,250.22 (2,249,694,919.15) 330,233,181.61
Staff welfare 1,390,324.53 78,183,745.16 (78,104,688.62) 1,469,381.07
Social security contribution 1,749,787.15 106,178,873.53 (105,734,332.16) 2,194,328.52
Including: Medical insurance 1,488,183.67 97,295,076.61 (97,251,566.33) 1,531,693.95
Work injury insurance 34,813.39 2,594,296.30 (2,544,824.34) 84,285.35
Maternity insurance 226,790.09 6,289,500.62 (5,937,941.49) 578,349.22
Housing funds 1,461,572.85 91,053,848.06 (90,865,027.72) 1,650,393.19
Labor union funds and employee
education funds 8,550,047.84 42,259,342.96 (39,625,521.10) 11,183,869.70
Other short-term benefits 1,059,360.80 2,266,479.51 (2,454,018.54) 871,821.77
254,250,943.71 2,659,830,539.44 (2,566,478,507.29) 347,602,975.86
2019 At beginning of Increase Decrease At end of year
year
Salaries, bonuses, allowances and
grants 218,723,238.10 1,802,546,687.73 (1,781,230,075.29) 240,039,850.54
Staff welfare 1,750,750.89 65,905,421.68 (66,265,848.04) 1,390,324.53
Social security contribution 1,869,898.84 101,183,713.52 (101,303,825.21) 1,749,787.15
Including: Medical insurance 1,601,616.55 90,504,348.37 (90,617,781.25) 1,488,183.67
Work injury insurance 37,298.33 3,028,282.49 (3,030,767.43) 34,813.39
Maternity insurance 230,983.96 7,651,082.66 (7,655,276.53) 226,790.09
Housing funds 1,133,400.56 74,407,462.56 (74,079,290.27) 1,461,572.85
Labor union funds and employee
education funds 10,001,452.12 31,581,582.98 (33,032,987.26) 8,550,047.84
Other short-term benefits 1,034,801.91 2,254,881.50 (2,230,322.61) 1,059,360.80
234,513,542.42 2,077,879,749.97 (2,058,142,348.68) 254,250,943.71
234
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable (Continued)
Defined contribution plan:
2020 At beginning of Increase Decrease At end of
year year
Basic pension
insurance 1,971,797.54 113,012,198.11 (111,390,615.38) 3,593,380.27
Unemployment
insurance 107,237.57 3,832,752.98 (3,833,272.43) 106,718.12
Contribution to a
pension fund 2,978,012.58 5,825,315.18 (3,287,221.66) 5,516,106.10
5,057,047.69 122,670,266.27 (118,511,109.47) 9,216,204.49
2019 At beginning of Increase Decrease At end of
year year
Basic pension
insurance 2,124,176.27 179,944,134.66 (180,096,513.39) 1,971,797.54
Unemployment
insurance 148,628.42 5,453,337.92 (5,494,728.77) 107,237.57
Contribution to a
pension fund 3,370,636.18 6,022,506.73 (6,415,130.33) 2,978,012.58
5,643,440.87 191,419,979.31 (192,006,372.49) 5,057,047.69
235
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable (Continued)
Termination benefits:
2020 At beginning of Increase Decrease At end of year
year
Retirement
benefits payable
- within 1 year
(Note V (35)) 247,866.06 182,000.00 (224,192.41) 205,673.65
Other termination
benefits (1) 84,955.64 862,714.24 (760,476.78) 187,193.10
332,821.70 1,044,714.24 (984,669.19) 392,866.75
Termination benefits:
2019 At beginning of Increase Decrease At end of year
year
Retirement
benefits payable
- within 1 year
(Note V (35)) 408,057.61 631,005.86 (791,197.41) 247,866.06
Other termination
benefits (1) 57,793.53 831,267.26 (804,105.15) 84,955.64
465,851.14 1,462,273.12 (1,595,302.56) 332,821.70
(1) In 2020, other termination benefits for severing labor relations provided by the Group was
RMB862,714.24 and the unpaid balance at the end of the year was RMB187,193.10 (2019:
Other termination benefits for severing labor relations was RMB831,267.26, and the unpaid
balance at the end of the year was RMB84,955.64).
236
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
28. Tax payable
31 December 2020 31 December 2019
Corporate Income taxes 173,016,908.47 127,697,970.77
Value-added tax 102,586,862.95 88,904,599.66
Stamp duty 8,243,076.57 6,089,170.55
City maintenance and construction
surtax 6,993,947.17 6,795,877.54
Individual income tax 6,790,402.61 4,532,506.64
Water conservancy fund 5,586,926.64 5,488,930.64
Educational surcharge 5,254,608.43 5,089,214.42
Property tax 664,697.78 532,454.30
Land use tax 54,028.60 11,137.20
Others 7,675,689.94 8,237,662.62
316,867,149.16 253,379,524.34
29. Other payables
31 December 2020 31 December 2019
Interest payable 35,572,620.82 23,632,632.90
Dividend payable 6,389,320.96 6,389,320.96
Other payables 1,557,204,939.36 1,792,342,683.76
1,599,166,881.14 1,822,364,637.62
Interest payable
31 December 2020 31 December 2019
Factoring interest on accounts
receivable 35,572,620.82 23,632,632.90
Dividend payable
31 December 2020 31 December 2019
Shanghai Fosun Pharmaceutical
(Group) Co., Ltd. (“Fosun Pharm”) 4,835,511.58 4,835,511.58
Dividend payable to Zhang Zhenfang 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 31 December 2020 and 31 December 2019, the Group had no significant dividend aged more
than one year and not yet paid.
237
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
29. Other payables (Continued)
Other payables
31 December 2020 31 December 2019
Payables for factoring programs 576,523,284.81 849,490,467.87
Deposits 472,800,624.92 425,140,894.94
Accrued expenses 213,950,722.34 129,552,787.78
Payables for rentals 68,417,303.16 26,375,012.00
Payables for construction in progress
and equipment 40,898,589.59 56,723,800.74
Equity payable 38,702,372.01 118,216,771.62
Payables to individuals 25,869,320.67 31,939,639.73
Collection of others 19,119,286.19 11,844,558.24
Payables for land transfer payments 12,597,500.00 12,597,500.00
Temporary loans 11,017,981.51 15,800,000.00
Payables to related parties 5,093,263.36 67,028,812.08
Others 72,214,690.80 47,632,438.76
1,557,204,939.36 1,792,342,683.76
At 31 December 2020, significant other payables outstanding for over 1 year are as follows:
Amount payable Reason for outstanding
Equity payable 36,000,000.00 Payment conditions not met
Deposits 23,479,247.53 Payment conditions not met
Accrued expenses 14,404,245.22 Payment conditions not met
Payables for land transfer payments 12,597,500.00 Payment conditions not met
86,480,992.75
30. Non-current liabilities due within one year
31 December 2020 31 December 2019
Long-term borrowings due within 1
year - 31,638,984.25
Lease liabilities due within 1 year
(Note V (33)) 748,732,059.89 580,278,863.12
748,732,059.89 611,917,847.37
238
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
31. Other current liabilities
31 December 2020 31 December 2019
VAT collected in advance 24,142,106.09 -
Output VAT to be recognised 644,972.46 749,710.19
24,787,078.55 749,710.19
32. Long-term borrowings
31 December 2020 31 December 2019
Entrusted loans 31,637,173.89 -
At 31 December 2020, the balance of entrusted loans was RMB31,637,173.89 (31 December
2019: nil). CNPGC entrusted Sinopharm Group Finance Co., Ltd. to provide the loan.
At 31 December 2020, the weighted average annual interest rate of the entrusted loans was
3.41% (31 December 2019: 4.04%).
33. Lease liabilities
31 December 2020 31 December 2019
Lease payment 2,217,275,863.33 1,958,724,577.28
Unrecognised financing expenses (165,489,639.54) (169,992,684.65)
Less: Lease liabilities due within 1 year
(Note V (30)) 748,732,059.89 580,278,863.12
1,303,054,163.90 1,208,453,029.51
34. Long-term payables
31 December 2020 31 December 2019
Long-term payables - -
Payables for specific projects 6,938,189.00 800,000.00
6,938,189.00 800,000.00
239
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
34. Long-term payables (Continued)
Payables for specific projects
2020
At beginning of year Increase Decrease At end of year
Special funds granted by the
government (1) 800,000.00 - - 800,000.00
Medical reserve funds (2) - 6,138,189.00 - 6,138,189.00
800,000.00 6,138,189.00 - 6,938,189.00
2019
At beginning of year Increase Decrease At end of year
Special funds granted by the
government 800,000.00 - - 800,000.00
(1) The specific payables are research funds allocated by government departments and are
accounted for the specific payable account at the time of allocation.
(2) The medical reserve funds were allocated by the Liaoning Province Department of Finance to
CDFY which was incorporated into the consolidation in 2020.
35. Long-term employee benefits payable
31 December 2020 31 December 2019
Net liabilities of defined benefit plans 270,000.00 351,000.00
Long-term termination benefits 1,049,000.00 1,082,000.00
1,319,000.00 1,433,000.00
31 December 2020 31 December 2019
Early retirement benefits payable 1,524,673.65 1,680,866.06
Less: Retirement benefits payable
within 1 year (Note V (27)) 205,673.65 247,866.06
1,319,000.00 1,433,000.00
240
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
35. Long-term employee benefits payable (Continued)
Some employees of the Group have enrolled into early retirement. The primary actuarial
assumptions adopted at the end of the reporting period are presented as follows:
31 December 2020 31 December 2019
Discount rate 3.25% 3.25%
Growth rate of wages 6.00% 6.00%
The total post-employment benefits recognised in profit or loss of the current year are shown
below:
2020 2019
Included in administrative expenses 17,000.00 (49,994.14)
Included in finance costs 51,000.00 64,000.00
68,000.00 14,005.86
36. Accrued liabilities
At beginning At ending
of year Increase Decrease of year
Pending litigation or
arbitration (1) - 68,808,166.79 - 68,808,166.79
(1) Four companies with Zhang Peng as the actual controller signed several contracts with
Shenyang Branch of Bank of Dalian Co., Ltd. (“the Bank”) in previous years, which
agreed that the above companies would transfer their creditor's rights of accounts
receivable of Liaoning Chengda Fangyuan Pharmaceutical Co., Ltd. to the Bank, and the
Bank would conduct factoring business for the above companies in accordance with the
agreement. As the four companies failed to pay the relevant amount to the Bank, the
Bank filed a lawsuit to the People’s Court, requesting Liaoning Chengda Fangyuan
Pharmaceutical Co., Ltd. and its parent company, CDFY, to assume the corresponding
legal responsibilities. Liaoning Chengda Fangyuan Pharmaceutical Co., Ltd. recognised
the accrued liabilities of RMB68,663,166.79 in accordance with the progress of the case.
241
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
37. Deferred income
2020 Opening balance Increase Decrease Closing balance
Government grants 88,704,272.88 9,390,663.97 (8,251,353.48) 89,843,583.37
2019 Opening balance Increase Decrease Closing balance
Government grants 91,521,815.10 3,477,445.94 (6,294,988.16) 88,704,272.88
As at 31 December 2020, deferred income from government grants is as follows:
Government grants program Opening balance Addition in the Amount included Other changes Closing balance Asset-related/
year in other income in income-related
the year
Resettlement compensation (1) 72,857,032.61 - - (2,698,408.56) 70,158,624.05 Asset-related
Logistics project of Nanning
Economic Development Zone
construction support funds 5,032,972.31 - (186,406.44) - 4,846,565.87 Asset-related
Construction fund of the modern
supply chain system in the
central circulation field in 2018 2,364,075.79 2,651,300.00 (662,356.25) - 4,353,019.54 Asset-related
Guangzhou logistics
standardisation pilot project 2,268,765.71 - (546,246.84) - 1,722,518.87 Asset-related
Special funds for industrial
transformation and upgrading in
dualized integration projects 1,276,698.66 - (449,040.48) - 827,658.18 Asset-related
Comprehensive experimental
modern service industry
subsidies 1,200,000.00 - (300,000.00) - 900,000.00 Asset-related
Funds for the logistics information
platform project of the
pharmaceutical storage centre 952,381.11 - (142,857.12) - 809,523.99 Asset-related
Asset-related/
Other projects 2,752,346.69 6,739,363.97 (2,971,260.75) (294,777.04) 6,225,672.87 income-related
88,704,272.88 9,390,663.97 (5,258,167.88) (2,993,185.60) 89,843,583.37
242
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
37. Deferred income (Continued)
As at 31 December 2019, deferred income from government grants is as follows:
Government grants program Opening balance Addition in the Amount included Other changes Closing balance Asset-related/
year in other income in income-related
the year
Resettlement compensation (1) 75,555,441.17 - - (2,698,408.56) 72,857,032.61 Asset-related
Logistics project of Nanning
Economic Development Zone
construction support funds 5,219,378.75 - (186,406.44) - 5,032,972.31 Asset-related
Construction fund of the modern
supply chain system in the
central circulation field in 2018 - 2,651,300.00 (287,224.21) - 2,364,075.79 Asset-related
Guangzhou Logistics
standardisation pilot project 2,815,012.55 - (546,246.84) - 2,268,765.71 Asset-related
Special funds for industrial
transformation and upgrading
in dualized integration projects 1,687,899.50 - (411,200.84) - 1,276,698.66 Asset-related
Comprehensive experimental
modern service industry
subsidies 1,500,000.00 - (300,000.00) - 1,200,000.00 Asset-related
Funds for the logistics
information platform project of
the pharmaceutical storage
centre 1,083,333.47 - (130,952.36) - 952,381.11 Asset-related
Asset-related/
Other projects 3,660,749.66 826,145.94 (1,734,548.91) - 2,752,346.69 income-related
91,521,815.10 3,477,445.94 (3,596,579.60) (2,698,408.56) 88,704,272.88
(1) 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 obtain a
compensation of RMB120,250,000.00, including cash of RMB50,000,000.00 and a property in construction equal to a value
of RMB70,250,000.00. Cash compensation of RMB50,000,000.00 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 recognised as investment properties.
The compensation relating to the capital expenditure in the reconstruction of the new logistic center in another place,
amounting to RMB93,320,000.00, was recognised as deferred income and would be amortised and recognised in the
income statement within the expected useful lives using the straight-line method, and the other cash compensation, of
which the amount approximates to RMB26,930,000.00, was recognised in the income statement in 2012.
243
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
38. Other non-current liabilities
31 December 2020 31 December 2019
Medical reserve funds (1) 711,029,182.37 46,723,743.31
Product promotion accumulative points
programme (2) 29,815,911.17 26,478,986.49
Others 17,896.05 53,785.13
740,862,989.59 73,256,514.93
(1) The medical reserve funds include the Central Medical Reserve Funds, the Provincial Reserve Funds, the
Municipal Reserve Funds, and the Emergency Reserve Funds allocated by the Central Ministry of Finance
to establish the system of reserve medical supplies for public health emergencies.
(2) The product promotion accumulative points programme refers to those product-originated accumulative
points that remain surplus for more than one year before the expiration date.
39. Share capital
2020 At beginning of Increase/decrease during the current year At end of the year
the year
Issue of new shares Others Subtotal
Listed shares without
restriction of trading:
-A shares, listed 307,744,355.00 - 59,989,270.00 59,989,270.00 367,733,625.00
-B shares, listed 54,884,475.00 - - - 54,884,475.00
Listed shares with
restriction of trading:
-State-owned legal
person shares 60,380,743.00 - (54,874,973.00) (54,874,973.00) 5,505,770.00
-Legal person
registered within
China shares 5,114,297.00 - (5,114,297.00) (5,114,297.00) -
-Natural person
registered within
China shares 3,113.00 - - - 3,113.00
428,126,983.00 - - - 428,126,983.00
2019 At beginning of Increase/decrease during the current year At end of the year
the year
Issue of new shares Others Subtotal
Listed shares without
restriction of trading:
-A shares, listed 307,744,355.00 - - - 307,744,355.00
-B shares, listed 54,884,475.00 - - - 54,884,475.00
Listed shares with
restriction of trading:
-State-owned legal
person shares 60,380,743.00 - - - 60,380,743.00
-Legal person
registered within
China shares 5,114,297.00 - - - 5,114,297.00
-Natural person
registered within
China shares 3,113.00 - - - 3,113.00
428,126,983.00 - - - 428,126,983.00
244
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
40. Capital surplus
At beginning of the
2020 year Increase Decrease At end of the year
Share premium 2,118,174,787.27 - - 2,118,174,787.27
Other capital surplus -
Significant reorganization 1,173,907,763.19 - - 1,173,907,763.19
Transfer of capital surplus recognised
under the previous accounting system 2,650,322.00 - - 2,650,322.00
Other changes in equity of invested
units under the equity method (1) (52,009,984.28) - (393,875.73) (52,403,860.01)
Business combination under common
control (2) 107,759,447.87 - (97,869,029.99) 9,890,417.88
Others 1,120,284,623.39 - - 1,120,284,623.39
4,470,766,959.44 (98,262,905.72) 4,372,504,053.72
At beginning of the
2019 year Increase Decrease At end of the year
Share premium 2,118,174,787.27 - - 2,118,174,787.27
Other capital surplus -
Significant reorganization 1,173,907,763.19 - - 1,173,907,763.19
Transfer of capital surplus recognised
under the previous accounting system 2,650,322.00 - - 2,650,322.00
Other changes in equity of invested
units under the equity method (1) (94,032,514.34) 42,022,530.06 - (52,009,984.28)
Business combination under common
control (2) 107,759,447.87 - - 107,759,447.87
Others 1,120,284,623.39 - - 1,120,284,623.39
4,428,744,429.38 42,022,530.06 - 4,470,766,959.44
(1) A decrease of RMB393,875.73 in other changes in equity of the invested entity under the equity method in the current year, which
was due to the decrease of other changes in equity of the Group’s associate company, Shyndec Pharma, decreased the book
value of a long-term equity investment and wrote down the capital reserve of RMB393,875.73.
An increase of RMB42,022,530.06 in other changes in equity of the invested entity under the equity method in 2019, which was
due to the increase of other changes in equity of the Group’s associate company, Shyndec Pharma, increased the book value of a
long-term equity investment and included in capital surplus of RMB42,022,530.06.
(2) The Company’s subsidiary, Guoda Drugstore, acquired Pudong Medicine, an enterprise under common control on January 2nd,
2020, which formed a business combination under common control (Note VI (2)). At the beginning of the period, the Company
restated and confirmed the capital reserve of RMB107,759,447.87, offsetting the capital reserve of RMB107,759,447.87 at the
consolidation date. The capital surplus was recognised at RMB9,890,417.88 on the basis of the difference between the book value
of identifiable net assets and the consideration payments at the consolidation date.
245
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
41. Other comprehensive income
Accumulated balance of other comprehensive income attributable to owners of the parent in the consolidated
balance sheet:
1 January 2020 Increase/decrease 31 December 2020
Change in the fair value of other
equity investments 46,050,708.96 (7,439,657.92) 38,611,051.04
Other comprehensive income
using the equity method that
may be reclassified to profit or
loss (133,366.19) 5,332.87 (128,033.32)
45,917,342.77 (7,434,325.05) 38,483,017.72
The current occurrence amount of other comprehensive income in the consolidated income statement is as
follows:
Occurrence Less: Attributable to Attributable to
amount before Income tax owners of the non-controlling
tax parent interests
Other comprehensive income
that will not be reclassified to
profit or loss
Change in the fair value of other
equity investments (16,532,659.72) 4,133,164.93 (7,439,657.92) (4,959,836.87)
Other comprehensive income
that may be reclassified to
profit or loss
Other comprehensive income
using the equity method that
may be reclassified to profit or
loss 5,332.87 - 5,332.87 -
(16,527,326.85) 4,133,164.93 (7,434,325.05) (4,959,836.87)
246
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
42. Surplus reserves
31 December 2020 31 December 2019
Statutory surplus reserves 214,063,491.50 214,063,491.50
According to the provisions of the Company Law and the Company’s articles of association, the Company
appropriates statutory surplus reserves at 10% of the net profit. Where the accumulated amount of surplus
reserves reaches 50% or more of the Company’s registered capital, additional appropriation is not required.
When approved, the discretionary surplus reserves can be used to recover accumulated losses or increase
share capital. The accumulated amount of the statutory surplus reserves of the Company has already
reached 50% of the registered capital. According to the Company’s articles of association, the Company
would not continue to appropriate the surplus reserves.
43. Retained earnings
31 December 2020 31 December 2019
Retained earnings at the end of the prior year before
adjustment 7,755,295,537.08 6,655,257,147.27
Adjust: Business combination under common control (1) (3,029,877.91) 328,013.78
Retained earnings at the end of the prior year after
adjustment 7,752,265,659.17 6,655,585,161.05
Add: Net profit attributable to the parent 1,401,892,593.23 1,267,931,291.32
Less: Withdrawal from the surplus reserves - -
Cash dividends payable for ordinary shares (2) 256,876,189.80 171,250,793.20
Others 2,136,956.21 -
Retained earnings at end of year 8,895,145,106.39 7,752,265,659.17
(1) Due to the change in the scope of business combination under the common control, the undistributed
profit at the beginning of the year was decreased by RMB3,029,877.91 (2019: increased by
RMB328,013.78).
(2) Pursuant to the resolution of the General Meeting of shareholders on 15 May 2020, the Company
paid a cash dividend of RMB6.00 for every 10 shares to all shareholders. The cash dividend was
calculated on the basis of 428,126,983 shares in issue, with an aggregate amount of
RMB256,876,189.80.
247
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
44. Operating revenue and cost
2020 2019
Revenue Cost Revenue Cost
Principal operations 59,129,559,267.80 52,474,778,734.75 52,403,059,847.05 46,844,290,615.65
Other operations 519,895,744.23 116,988,729.62 383,747,629.23 46,933,689.39
59,649,455,012.03 52,591,767,464.37 52,786,807,476.28 46,891,224,305.04
Revenue is as follows:
2020 2019
Revenue from contracts with customers 59,575,293,446.98 52,710,788,688.18
Rentals 74,161,565.05 76,018,788.10
59,649,455,012.03 52,786,807,476.28
Disaggregation of revenue from contracts with customers is as follows:
2020 2019
Place of business
China 59,575,293,446.98 52,710,788,688.18
Types of major activities
Pharmaceutical distribution 41,771,721,959.60 39,289,565,512.68
Retail pharmacy 17,626,007,757.96 13,327,372,258.48
Others 177,563,729.42 93,850,917.02
59,575,293,446.98 52,710,788,688.18
Types of major goods
Pharmaceuticals 54,004,558,520.07 48,911,083,932.45
Medical devices and disposables 4,010,735,060.66 2,756,591,633.83
Diagnostic reagents 947,638,322.63 692,370,435.53
Medical equipment 434,797,814.20 256,891,769.35
Others 177,563,729.42 93,850,917.02
59,575,293,446.98 52,710,788,688.18
248
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
44. Operating revenue and cost (Continued)
Disaggregation of revenue from contracts with customers is as follows: (Continued)
2020 2019
Timing of revenue recognition
At a point in time
Sale of goods 59,397,729,717.56 52,616,937,771.16
Over time
Providing services 68,569,069.02 50,137,787.92
Storage and logistics 108,994,660.40 43,713,129.10
59,575,293,446.98 52,710,788,688.18
Revenue recognised that was included in contract liabilities at the beginning of the year is as
follows:
2020 2019
Sale of goods 302,650,567.97 255,590,612.37
The Group has recognised contract liabilities in total of RMB368,600,357.14 through the sale of
goods and provision of services in the current year. The expected revenue recognition time for the
Group’s contract obligations above is in year 2021.
Information about the Group’s performance obligations is summarised below:
(1) Revenue is recognised when control of the goods has transferred, and payment is generally
due within 30 to 210 days from delivery;
(2) Revenue is recognised in the service duration and the payment is generally due within 30 to
210 days since the service is completed.
249
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
45. Taxes and surcharges
2020 2019
City maintenance and construction tax 59,276,259.36 52,987,733.40
Educational surcharge 43,510,012.21 38,516,540.15
Stamp duty 39,538,983.99 36,384,850.88
Property tax 7,664,420.10 7,499,320.37
River & embankment maintenance fee 1,949,549.82 778,070.25
Land tax 1,174,966.86 1,034,041.67
Vehicle and vessel use tax 194,779.35 149,680.18
Others 1,322,475.51 249,900.06
154,631,447.20 137,600,136.96
46. Selling expenses
2020 2019
Employee benefits 2,043,118,426.77 1,664,788,059.02
Depreciation expenses of right-of-use assets 835,697,733.77 636,332,762.88
Rental expenses 158,482,491.26 129,382,940.25
Technical service fee 131,325,755.99 80,597,774.81
Amortisation of long-term deferred expenses 115,379,262.15 94,818,505.47
Depreciation expenses of fixed assets 97,651,219.31 80,389,019.76
Utilities 78,849,800.64 66,594,129.68
Office expense 66,308,505.21 44,962,674.71
Promotion and marketing expenses 49,558,552.69 50,973,960.56
Storage expenses 36,065,016.61 26,878,397.01
Entertainment expenses 33,444,574.42 32,702,753.92
Property management fee 31,062,038.32 29,632,095.50
Amortisation of intangible assets 27,930,125.84 12,646,048.96
Market development fee 21,647,420.16 6,347,031.83
Repairing fees 20,602,212.23 17,320,783.19
Conference expenses 16,225,584.87 12,097,686.10
Travel allowances 7,965,661.14 9,773,557.45
Others 171,819,714.37 171,769,654.59
3,943,134,095.75 3,168,007,835.69
250
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
47. Administrative expenses
2020 2019
Employee benefits 699,697,917.02 595,179,534.54
Office expense 35,056,907.24 31,008,477.00
Technical service fee 30,879,626.54 21,405,611.44
Depreciation expenses of fixed assets 30,748,526.91 27,925,016.38
Rental expenses 26,955,390.76 16,718,745.74
Depreciation expenses of right-of-use assets 23,903,526.11 24,345,562.98
Amortisation of intangible assets 22,075,334.76 20,047,861.51
Agency service fee 16,719,272.96 15,874,413.01
Amortisation of long-term deferred expenses 16,330,808.19 12,267,769.44
Entertainment expenses 15,641,332.80 16,793,933.15
Promotion and marketing expenses 8,377,538.57 12,495,124.13
Travel allowance 8,372,052.69 11,597,019.38
Vehicle management expenses 8,036,500.07 8,028,553.56
Property management fee 6,252,043.20 5,747,530.40
Repairing fee 5,803,015.00 6,592,921.58
Utilities 5,303,905.41 7,599,178.45
Others 48,025,117.55 37,449,214.93
1,008,178,815.78 871,076,467.62
48. Finance costs
2020 2019
Interest expenses 258,189,163.79 276,490,046.68
Less: Interest income 136,455,990.10 139,860,973.14
Cash discount from purchase 41,965,157.97 43,252,757.88
Exchanges gain/(loss) 52,538.86 (390,756.61)
Others 40,034,615.27 33,354,707.49
119,855,169.85 126,340,266.54
A breakdown for interest income is as follows:
2020 2019
Cash 136,455,990.10 139,860,973.14
251
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
49. Other income
2020 2019 Related to asset/income
VAT reduction from small-scale taxpayers 12,478,277.50 6,159,608.34 /
VAT additional deduction 1,754,349.24 1,331,762.26 /
Taxation service charge refund 1,082,430.43 515,187.02 /
Transfer from other deferred income 1,019,634.01 1,427,850.54 Related to asset
Construction fund of the modern supply chain
system in the central circulation field in
2018 662,356.25 287,224.21 Related to asset
Guangzhou logistics standardisation pilot
project 546,246.84 546,246.84 Related to asset
Industrial transformation and upgrading in
dualized integration project 449,040.48 411,200.84 Related to asset
Comprehensive experimental modern
service industry subsidies 300,000.00 300,000.00 Related to asset
Job stabilisation grants 23,907,132.61 8,704,495.35 Related to income
Tax return 6,362,566.77 7,944,738.61 Related to income
Government support funding 5,693,338.30 8,074,003.07 Related to income
Subsidies related to COVID-19 4,860,421.11 - Related to income
Enterprise economy award 4,103,804.00 2,555,293.34 Related to income
Government grants for medicine reserve
expenses 3,280,609.72 3,417,500.00 Related to income
Tax preference for self-employed retired
soldiers 861,689.99 631,860.00 Related to income
Others 5,001,910.94 2,922,148.28 Related to income
72,363,808.19 45,229,118.70
50. Investment income
2020 2019
Long-term equity investment income under
the equity method 354,345,705.65 331,171,902.87
Investment income from non-current financial
assets that are held 4,109,881.90 -
Dividend income from other equity
investments that are still held 640,538.07 471,386.60
Investment income from disposal of long-term
equity investments - 919,446.05
Investment income from the derecognition of
financial assets measured at amortised cost (76,142,835.36) (86,377,492.55)
Others 998,665.84 -
283,951,956.10 246,185,242.97
252
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
51. Credit impairment losses
2020 2019
Impairment loss on accounts receivable 21,209,110.01 4,771,468.16
Impairment loss on other receivables 3,286,689.75 48,284,731.96
Impairment loss on notes receivable 1,479,520.32 -
25,975,320.08 53,056,200.12
52. Impairment losses
2020 2019
Loss from write-down of inventories 5,079,297.71 1,180,898.16
Loss from impairment of other non-current assets 82,188.73 -
Loss from impairment of contract assets 17,799.31 -
Loss from impairment of long-term equity investments - 1,857,279.52
5,179,285.75 3,038,177.68
53. Gain on disposal of assets
2020 2019
Gain on disposal of right-of-use assets 6,094,970.49 1,862,763.18
Gain on disposal of fixed assets 696,992.01 688,411.84
6,791,962.50 2,551,175.02
54. Non-operating income
Included in
non-recurring
profit or losses in
2020 2019 2020
Government grants irrelevant to daily operation 6,037,572.78 5,015,608.56 6,037,572.78
Gain from writing off the unnecessary payment 4,342,240.20 16,601,380.58 4,342,240.20
Others 7,281,107.60 3,985,362.48 7,281,107.60
17,660,920.58 25,602,351.62 17,660,920.58
253
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
54. Non-operating income (Continued)
Government grants are as follows:
Asset-related/
2020 2019 income-related
Resettlement Compensation of Sinopharm Holding Guoda
Nanjing Pharmacy Chain Store Co., Ltd. 3,339,164.22 - Asset-related
Resettlement Compensation of Guangxi Logistics 2,698,408.56 2,698,408.56 Asset-related
Guangxi Logistics’ (“Water supply, power supply, heating and
property management”) financial subsidies - 2,317,200.00 Income-related
6,037,572.78 5,015,608.56
55. Non-operating expenses
Included in
non-recurring profit or
2020 2019 losses in 2020
Lawsuit compensation 16,510,153.06 235,000.00 16,510,153.06
Penalty and late payment expenses 2,218,668.33 1,151,694.82 2,218,668.33
Donation expenses 1,297,427.97 450,000.00 1,297,427.97
Loss on damage in non-current assets needed to be scrapped 1,223,651.40 225,899.84 1,223,651.40
Others 3,015,711.08 2,513,202.26 3,015,711.08
24,265,611.84 4,575,796.92 24,265,611.84
56. Government grants
The government grants, which are offset against the carrying amounts of the related assets and expenses as
set out below, are presented on a net basis.
2020 2019
Government grants related to income - -
Offset against finance costs (1) 2,385,907.71 1,378,372.43
Offset against administrative expenses (2) 59,398.58 -
Offset against selling expenses (2) 36,507.26 -
2,481,813.55 1,378,372.43
(1) In 2020, the Group received the following large amounts of loan discount funds: RMB1,636,557.33 from the
Finance Bureau of Nanning National Economic and Technological Development Zone for the COVID-19
epidemic, RMB130,500.00 from an industrial development fund of Futian Development Service Center of
Shenzhen, Guangdong Province and the loan discount fund of medical reserve material of RMB361,800.00
from the Pharmaceutical Reserve Supplies Fund of the Department of Finance of Guangxi Zhuang
Autonomous Region. The Group offset the above loan discount funds received in 2020 against financial
expenses.
(2) In 2020, the Group received RMB95,905.84 from the Shenzhen Social Insurance Fund Administration for
maternity allowance and offset the amount against the administrative expenses and selling expenses.
For details of other government subsidies, please refer to Note V (37 & 49 & 54)
254
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
57. Expenses by nature
The operating costs, selling expenses and administrative expenses are classified by nature and
listed as follows:
2020 2019
Inventories of finished and work-in-progress
goods/cost of inventories 52,575,257,040.80 46,870,965,233.34
Employee benefits 2,768,505,064.02 2,267,715,077.36
Depreciation and amortisation 1,194,018,733.06 927,099,515.77
Technical service fee 162,205,382.53 102,003,386.25
Rental expenses 151,957,389.34 146,101,685.99
Office telecom and internet expenses 101,365,412.45 75,971,151.71
Utilities 90,047,842.72 76,586,878.93
Transportation expenses 83,372,921.46 92,959,071.86
Promotion and marketing expenses 79,583,511.42 69,816,116.52
Entertainment expenses 49,085,907.22 49,496,687.07
Property management fee 37,314,081.52 35,379,625.90
Storage expenses 36,065,016.61 26,878,397.01
Travel allowance 28,019,639.55 30,479,756.64
Repairing fee 26,405,227.23 23,913,704.77
Conference expenses 19,914,839.02 18,364,777.22
Agency service fee 16,719,272.96 15,874,413.01
Others 123,243,093.99 100,703,129.00
57,543,080,375.90 50,930,308,608.35
255
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
58. Income tax expenses
2020 2019
Current tax expenses 444,118,362.45 368,951,752.27
Deferred tax expenses (8,178,312.39) 2,344,972.51
435,940,050.06 371,296,724.78
The reconciliation between income tax expenses and profit before income taxes is as follows:
2020 2019
Profit before income tax expenses 2,157,236,448.78 1,851,456,178.02
Income taxes calculated at applicable tax rates 539,309,112.20 462,864,044.50
Lower tax rates enacted by local authorities (38,815,678.48) (28,039,776.17)
Income not subject to tax (88,586,426.41) (82,792,975.72)
Expenses not deductible for tax 17,821,245.15 16,422,209.23
Deductible loss on unconfirmed deferred tax assets
at end of the year 4,248,143.80 5,691,924.17
Utilization of previously unrecognised tax losses 1,132,158.95 705,689.03
Adjustment of income tax expenses of previous years 831,494.85 (3,554,390.26)
Income tax expenses 435,940,050.06 371,296,724.78
59. Earnings per share
2020 2019
RMB/share RMB/share
Basic earnings per share
Continuing operations 3.27 2.96
Diluted earnings per share
Continuing operations 3.27 2.96
The basic earnings per share are calculated by dividing the consolidated net profit of the current year
attributable to the ordinary shareholders of the Company by the adjusted weighted average number of
outstanding ordinary shares.
In year 2020, the Company had no potential dilutive ordinary shares and the diluted earnings per share were
the same as the basic earnings per share.
256
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
59. Earnings per share (Continued)
The calculation of basic and diluted earnings per share is as follows:
2020 2019
Earnings
Consolidated net profit attributable to the
shareholders of the parent 1,401,892,593.23 1,267,931,291.32
Continuing operations 1,401,892,593.23 1,267,931,291.32
Net profit attributable to the calculation of
earnings per share 1,401,892,593.23 1,267,931,291.32
Shares
Adjusted weighted average number of ordinary
shares outstanding 428,126,983.00 428,126,983.00
Basic and diluted earnings per share 3.27 2.96
60. Notes to items in the cash flow statement
Other cash receipts relating to operating activities
2020 2019
Receipts from the emergency medical supplies
reserve 784,665,445.45 -
Interest income 136,427,967.70 139,482,955.85
Rent income 74,161,565.05 64,005,908.13
Government grants except tax return 47,708,906.67 33,780,335.30
Others 654,419,910.31 532,291,440.02
1,697,383,795.18 769,560,639.30
Other cash payments relating to operating activities
2020 2019
Rental expenses 151,957,389.34 181,612,854.19
Office expenses 101,365,412.45 75,628,350.61
Advertising expenses 79,583,511.42 68,977,606.62
Entertainment expenses 49,085,907.22 48,599,992.71
Bank charges 37,676,127.97 29,123,133.47
Travel expenses 28,019,639.55 30,448,970.18
Conference expenses 19,914,839.02 18,138,447.03
Others 1,203,408,557.10 769,828,162.37
1,671,011,384.07 1,222,357,517.18
257
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
60. Notes to items in the cash flow statement (Continued)
Other cash receipts relating to investing activities
2020 2019
Allocation of cash pool (1) 22,000,000.00 478,800,000.00
Refund of the expense of “Water supply, power supply,
heating and property management” 1,992,616.05 -
Receipts of entrusted loan payments of Zhijun Suzhou - 3,180,035.98
Others 59,058.62 8,444.09
24,051,674.67 481,988,480.07
(1) Pudong Medicine, a subsidiary of the merger of enterprises under the common control of Guoda Drugstore,
received the appropriation from the cash pool of Sinopharm Group, the original parent company of Pudong
Medicine in the previous year, and recovered the funds originally collected to the cash pool in the current
year.
Other cash payments relating to investing activities
2020 2019
Payment of long-term deposits 5,000,000.00 -
Payment of cash pool (1) - 452,800,000.00
Expense payment of “Water supply, power supply,
heating and property management” - 1,093,125.00
Others 2,197.26 1,504,625.74
5,002,197.26 455,397,750.74
(1) Pudong Medicine, a subsidiary of the merger of enterprises under the common control of Guoda Drugstore,
made the collection to the cash pool of Sinopharm Group, the original parent company of Pudong Medicine
in the previous year.
Other cash receipts relating to financing activities
2020 2019
Loan from other related parties received
160,700,000.00 -
Financing restricted monetary funds received
141,308,707.63 134,955,774.35
Loan from Sinopharm Group received 56,000,000.00 -
Factoring payable received - 114,349,993.77
Others 1,323,768.00 -
359,332,475.63 249,305,768.12
258
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
60. Notes to items in the cash flow statement (Continued)
Other cash payments relating to financing activities
2020 2019
Payment of the lease principal 886,017,712.27 708,869,138.96
Payment of the loan to other related parties 362,303,318.18 -
Payment of the factoring payable 272,967,183.06 -
Investment in Pudong Medicine 163,115,049.98 -
Payment of the loan to Sinopharm Group 114,000,000.00 -
Payment of equity of minority shareholders 67,520,417.11 -
Others - 9,803,690.92
1,865,923,680.60 718,672,829.88
259
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
61. Supplementary information of the cash flow statement
(1) Supplementary information of the cash flow statement
Reconciliation of net profit to cash flows from operating activities
2020 2019
Net profit 1,721,296,398.72 1,480,159,453.24
Add: Provision for asset impairment 31,154,605.83 56,094,377.80
Depreciation of fixed assets and investment properties 139,721,479.94 117,609,593.00
Depreciation of right-of-use assets 867,425,059.82 668,029,496.58
Amortisation of intangible assets 50,760,373.29 33,092,678.04
Amortisation of long-term prepaid expenses 136,111,820.01 108,367,748.15
Gains on disposal of fixed assets and other long-term assets (5,568,311.10) (2,337,678.02)
Finance expenses 211,028,322.66 210,425,050.18
Investment income (283,951,956.10) (246,185,242.97)
Increase in deferred tax assets (8,261,294.12) (4,332,084.74)
(Decrease)/increase in deferred tax liabilities (4,050,183.18) 6,677,057.25
Increase in inventories (406,383,320.25) (511,440,122.17)
Increase in operating receivables (2,989,963,280.33) (793,309,108.86)
Increase in operating payables 2,124,730,859.17 1,009,745,615.25
Increase in restricted operating cash with restriction (81,303,975.89) (119,943,642.99)
Net cash flows from operating activities 1,502,746,598.47 2,012,653,189.74
Movement of cash
2020 2019
Cash at the end of year 5,405,113,257.99 8,426,071,170.16
Less: Cash at the beginning of year 8,426,071,170.16 7,634,936,037.30
Net (increase)/increase in cash (3,020,957,912.17) 791,135,132.86
260
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
61. Supplementary information of the cash flow statement (Continued)
(2) Acquisition and disposal of subsidiaries and other operating units
Acquisition of subsidiaries and other operating units
2020 2019
Price of acquiring subsidiaries and other operating units
2,839,268,100.00 143,993,800.00
Including: CDFY 1,860,000,000.00 -
Shanghai Dingqun 934,240,000.00 -
Liaoning Xianzhen 45,000,000.00 -
Sinopharm Accord (Yangjiang) Medicine Co., Ltd.
(“Yangjiang Medicine”) 18,100.00 -
Beijing Golden Elephant Guoxing Pharmaceutical
Co., Ltd. (“Golden Elephant Guoxing”) 10,000.00 -
Guoda Pu’er. - 90,000,000.00
Guoda Yongxingtang - 30,000,000.00
Inner Mongolia Tongren - 17,320,000.00
Guangzhou Medicine - 6,660,000.00
Guoda Pharmacy (Chaoyang) Renai Pharmacy
Co., Ltd. (“Chaoyang Renai”) - 13,800.00
Cash and cash equivalents paid for acquisitions of subsidiaries
and other operating units 2,824,445,549.00 106,262,760.00
Including: CDFY 1,860,000,000.00 -
Shanghai Dingqun 920,603,553.00 -
Liaoning Xianzhen 43,813,896.00 -
Yangjiang Medicine 18,100.00 -
Golden Elephant Guoxing 10,000.00 -
Guoda Pu’er. - 54,000,000.00
Guoda Yongxingtang - 30,000,000.00
Inner Mongolia Tongren - 15,600,000.00
Guangzhou Medicine - 6,660,000.00
Chaoyang Renai - 2,760.00
261
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
61. Supplementary information of the cash flow statement (Continued)
(2) Acquisition and disposal of subsidiaries and other operating units
2020 2019
Less: Cash and cash equivalents held by subsidiaries and
other operating units at the acquisition date 178,407,397.24 8,460,831.84
Including: CDFY 159,681,219.62 -
Shanghai Dingqun 18,639,019.00 -
Yangjiang Medicine 77,158.62 -
Golden Elephant Guoxing 10,000.00 -
Guoda Pu’er - 3,160,882.96
Guangzhou Medicine - 4,477,124.50
Chaoyang Renai - 822,824.38
Net cash outflow/(inflow) on acquisition of the subsidiaries and
other operating units (a) 2,646,038,151.76 97,801,928.16
(a) The net cash received from the acquisition of Yangjiang Medicine in the current year was
RMB59,058.62. The statement shows the receipt of other cash related to investment activities.
Disposal of subsidiaries and other operating units
2020 2019
Price of disposing of subsidiaries and other operating units - 1,530,000.00
Including: Qinhuangdao Guoda Pharmacy Chain Store Co., Ltd. - 1,530,000.00
Cash and cash equivalents received for disposals of subsidiaries
and other operating units - 1,530,000.00
Less: Cash and cash equivalents held by former subsidiaries
and other operating units - 738,535.24
Including: Qinhuangdao Guoda Pharmacy Chain Store Co., Ltd. - 738,535.24
Net cash inflow on disposal of the subsidiaries and other
operating units - 791,464.76
(3) Cash and cash equivalents
Cash
2020 2019
Cash on hand 6,707,125.90 5,333,515.38
Bank deposits on demand 5,398,406,132.09 8,420,737,654.78
Cash balance at the end of the year 5,405,113,257.99 8,426,071,170.16
262
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
62. Assets under restricted ownership or right to use
2020 2019 Note
Cash and cash equivalents 593,091,037.88 442,672,297.43 (1)
Notes receivable and accounts
receivables financing that were
endorsed 27,939,151.58 - (2)
Notes receivable that were
discounted - 64,038,348.12 (3)
Receivables financing that were
pledged 2,620,000.00 - (4)
623,650,189.46 506,710,645.55
(1) On 31 December 2020, the Group had deposits of bank acceptance bills, deposits for letters of credit,
and fixed deposits for guarantee or notice deposits of RMB593,091,037.88 (31 December 2019:
RMB442,672,297.43) (Note V (1)).
(2) On 31 December 2020, the Group had accounts receivables financing of RMB23,843,867.66 and
commercial acceptance bills receivable of RMB4,095,283.92, which were endorsed but not have
matured (31 December 2019: nil) (Note V (2) and (4)).
(3) On 31 December 2020, the Group had commercial acceptance bills receivable of RMB0.00, which
were discounted but have not matured (31 December 2019: RMB64,038,348.12) (Note V (2)).
(4) On 31 December 2020, the Group had pledged financing receivable of RMB2,620,000.00 (31
December 2019: nil) (Note V (4)).
263
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in the scope of consolidation
1. Business combinations not involving enterprises under common control
1.1 Acquisition of Yangjiang Medicine
Sinopharm Guangzhou, a subsidiary of the Company, acquired a 70% stake of Yangjiang Hecheng
Pharmaceutical Co., Ltd. (“Yangjiang Hecheng”) for RMB18,100.00. After the acquisition, Yangjiang
Hecheng was renamed as Sinopharm Accord (Yangjiang) Medicine Co., Ltd. The acquisition date is
determined as 31 October 2020.
The fair values and carrying amounts of identifiable assets and liabilities of Yangjiang Medicine on the
acquisition date are presented as follows:
31 October 2020 31 October 2020
Fair value Carrying amount
Cash and bank balances 77,158.62 77,158.62
Accounts receivable 166,050.50 166,050.50
Other receivables 118,594.59 118,594.59
Other current assets 1,464.42 1,464.42
Accounts payable 141,872.00 141,872.00
Other payables 195,437.61 195,437.61
Net assets 25,958.52 25,958.52
Less: Non-controlling interests 7,787.56 7,787.56
Net assets acquired 18,170.96 18,170.96
Amount exceeding the cost of merger recognised
as profit or loss in the current period 70.96
18,100.00 (1)
(1) The amount refers to the cash paid by the Group in business combination of RMB18,100.00.
Operating results and cash flows of Yangjiang Medicine for the period from the acquisition date to the end
of the year are presented as follows:
Period from 31 October 2020 to 31 December 2020
Operating revenue -
Net profit 93,736.52
Net cash flows 18,473,053.22
264
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
1.2 Acquisition of CDFY
Guoda Drugstore, a subsidiary of the Company, acquired 100% shares of CDFY with cash of
RMB1,860,000,000.00. The acquisition date is determined as 31 July 2020.
The fair values and carrying amounts of identifiable assets and liabilities of CDFY on the acquisition date
are presented as follows:
31 July 2020 31 July 2020
Fair value Carrying amount
Cash and bank balances 332,637,761.94 332,637,761.94
Notes receivable 13,857,023.20 13,857,023.20
Accounts receivable 319,004,312.40 319,004,312.40
Receivables financing 27,777,393.03 27,777,393.03
Advances to suppliers 50,460,269.07 50,460,269.07
Other receivables 14,383,522.69 14,383,522.69
Inventories 462,662,882.69 462,662,882.69
Other current assets 3,208,429.47 3,208,429.47
Fixed assets 118,631,423.38 87,589,485.70
Right-of-use assets 362,835,189.20 362,835,189.20
Intangible assets 150,293,638.90 24,022,089.70
Goodwill 62,575,074.45 62,575,074.45
Long-term prepaid expenses 41,907,706.40 41,907,706.40
Deferred tax assets 10,073,542.85 10,073,542.85
Other non-current assets 9,149,246.11 9,149,246.11
Notes payable 364,029,432.47 364,029,432.47
Accounts payable 375,865,987.88 375,865,987.88
Contract liabilities 28,102,823.30 28,102,823.30
Employee benefits payable 7,356,230.28 7,356,230.28
Tax payable 16,799,858.55 16,799,858.55
Other payables 30,521,512.91 30,521,512.91
Non-current liabilities due within one year 123,672,877.17 123,672,877.17
Lease liabilities 165,766,082.01 165,766,082.01
Long-term payable 6,138,189.00 6,138,189.00
Provision 68,663,166.79 68,663,166.79
Deferred income 1,358,802.42 1,358,802.42
Deferred tax liabilities 39,328,371.72 -
Net assets 751,854,081.28 633,868,966.12
Less: Non-controlling interests 11,722,682.94 11,722,682.94
Net assets acquired 740,131,398.34 622,146,283.18
Goodwill arising from acquisition 1,119,868,601.66
1,860,000,000.00 (1)
(1) The amount refers to the cash paid by the Group in business combination of RMB1,860,000,000.00.
265
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
1.2 Acquisition of CDFY (Continued)
Operating results and cash flows of CDFY for the period from the acquisition date to the end of the year
are presented as follows:
Period from 31 July 2020 to 31 December 2020
Operating revenue 1,196,961,806.29
Net profit 29,306,736.71
Net cash flows (136,105,840.06)
1.3 Acquisition of Golden Elephant Guoxing
Beijing Golden Elephant Pharmacy Medicine Chain Co., Ltd., a subsidiary of the Company, obtained a 100%
stake of Golden Elephant Guoxing with cash of RMB10,000.00. The acquisition date is determined as 2
April 2020.
The fair values and carrying amounts of identifiable assets and liabilities of Golden Elephant Guoxing on
the acquisition date are presented as follows:
4 April 2020 4 April 2020
Fair value Carrying amount
Cash and bank balances 10,000.00 10,000.00
Net assets 10,000.00 10,000.00
Net assets acquired 10,000.00 10,000.00
Goodwill arising from acquisition -
10,000.00 (1)
(1) The amount refers to the cash paid by the Group in business combination of RMB10,000.00.
Operating results and cash flows of Golden Elephant Guoxing for the period from the acquisition date to
the end of the year are presented as follows:
Period from 2 April 2020 to 31 December 2020
Operating revenue 48,005,507.34
Net profit 552,478.81
Net cash flows 3,433,330.36
266
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
1.4 Acquisition of the management right of 11 clinics and 43 directly-managed stores of
Liaoning Xianzhen
Guoda Shenyang, a subsidiary of the Company, obtained the management right of 11 clinics and 43
directly-managed stores of Liaoning Xianzhen with cash of RMB45,000,000.00. The acquisition date is
determined as 30 March 2020.
The fair values and carrying amounts of identifiable assets and liabilities of the management right of 11
clinics and 43 directly-managed stores of Liaoning Xianzhen on the acquisition date are presented as
follows:
30 March 2020 30 March 2020
Fair value Carrying amount
Inventories 10,000,000.00 10,000,000.00
Fixed assets 962,568.34 962,568.34
Net assets 10,962,568.34 10,962,568.34
Net assets acquired 10,962,568.34 10,962,568.34
Goodwill arising from acquisition 34,037,431.66
45,000,000.00 (1)
(1) The amount refers to the cash paid by the Group in business combination of RMB45,000,000.00.
Operating results and cash flows of the management right of 11 clinics and 43 directly-managed stores of
Liaoning Xianzhen for the period from the acquisition date to the end of the year are presented as follows:
Period from 30 March 2020 to 31 December 2020
Operating revenue 71,687,429.49
Net profit 2,502,690.30
Net cash flows 184,736.66
1.5 Acquisition of Shanghai Dingqun
Guoda Drugstore, a subsidiary of the Company, acquired 100% equity of Shanghai Dingqun from Ningbo
Meishan Bonded Port Area Qiling Equity Investment Center LP and the Company with
RMB934,240,800.00. The acquisition date is determined as 7 January 2020.
267
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
1.5 Acquisition of Shanghai Dingqun (Continued)
The fair values and carrying amounts of identifiable assets and liabilities of Shanghai Dingqun on the
acquisition date are presented as follows:
7 January 2020 7 January 2020
Fair value Carrying amount
Cash and bank balances 56,055,948.87 56,055,948.87
Accounts receivable 753,590,278.82 753,590,278.82
Receivables financing 19,457,255.29 19,457,255.29
Advances to suppliers 42,432,641.61 42,432,641.61
Other receivables 37,527,663.99 37,527,663.99
Inventories 346,785,462.21 346,785,462.21
Other current asset 6,040,985.16 6,040,985.16
Fixed assets 6,092,375.11 6,092,375.11
Right-of-use asset 101,117,742.73 101,117,742.73
Intangible asset 237,873,287.90 1,873,287.90
Long-term prepaid expenses 2,797,065.29 2,797,065.29
Deferred tax asset 20,212,628.97 20,212,628.97
Other non-current asset 98,900,000.00 98,900,000.00
Short-term borrowings 250,000,000.00 250,000,000.00
Notes payable 164,882,176.00 164,882,176.00
Accounts payable 224,639,145.65 224,639,145.65
Contract liabilities 1,344,985.26 1,344,985.26
Employee benefits payable 7,519,225.65 7,519,225.65
Tax payable 32,667,189.01 32,667,189.01
Dividend payable 38,823,529.41 38,823,529.41
Other payables 377,198,007.61 377,198,007.61
Non-current liabilities due within one year 24,715,341.58 24,715,341.58
Lease liabilities 55,614,900.64 55,614,900.64
Deferred tax liabilities 61,897,784.60 2,897,784.60
Net assets 489,581,050.54 312,581,050.54
Less: Non-controlling interests 76,177,296.71 49,627,296.71
Net assets acquired 413,403,753.83 262,953,753.83
Goodwill arising from acquisition 520,836,246.17
934,240,000.00 (1)
(1) The amount refers to the cash paid by the Group in business combination of RMB934,240,000.00.
Operating results and cash flows of Shanghai Dingqun for the period from the acquisition date to the end of
the year are presented as follows:
Period from 7 January 2020 to 31 December 2020
Operating revenue 2,032,228,329.32
Net profit 46,488,717.62
Net cash flows 11,762,634.99
268
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in scope of consolidation (Continued)
2. Business combinations involve enterprises under common control
Guoda Drugstore, a subsidiary of the Company, acquired 75% equity of Pudong Medicine from Sinopharm
Group with RMB163,115,049.98.
As both parties before and after the merger are controlled by Sinopharm Group and such control is not
temporary, the merger is a business combination under common control and the merger date is determined
as 2 January 2020.
Operating results and cash flows of Pudong Medicine for the period from the beginning of the current year to
the merger date and the previous accounting period are presented as follows:
Period from 1 January 2020 to 2 January 2020 2019
Operating revenue - 765,705,805.60
Net profit - (4,059,241.89)
Net cash flows - 575,388.15
The carrying amounts of assets and liabilities of Pudong Medicine on the merger date and the balance
sheet date of the previous accounting period are presented as follows:
2 January 2020 31 December 2019
Cash and bank balances 3,394,404.68 3,394,404.68
Accounts receivable 100,459,214.59 100,459,214.59
Advances to suppliers 4,946,238.30 4,946,238.30
Other receivables 23,970,596.45 23,970,596.45
Inventories 115,849,551.73 115,849,551.73
Other current asset 8,933.82 8,933.82
Fixed assets 95,400,228.52 95,400,228.52
Right-of-use asset 39,296,729.06 39,296,729.06
Intangible asset 54,842,072.44 54,842,072.44
Long-term prepaid expenses 7,065,829.13 7,065,829.13
Deferred tax asset 2,479,813.13 2,479,813.13
Goodwill 65,978,042.61 65,978,042.61
Accounts payable 155,320,266.34 155,320,266.34
Contract liability 544,372.73 544,372.73
Employee benefits payable 3,813,091.44 3,813,091.44
Tax payable 3,261,136.20 3,261,136.20
Other payables 65,506,176.60 65,506,176.60
Non-current liabilities due within one year 10,490,753.75 10,490,753.75
Lease liabilities 26,045,944.43 26,045,944.43
Deferred tax liabilities 34,567,476.49 34,567,476.49
Net assets 214,142,436.48 214,142,436.48
Less: Non-controlling interests 39,593,153.20 39,593,153.20
Net assets acquired 174,549,283.28 174,549,283.28
The difference included in equity 11,434,233.30
Consideration 163,115,049.98
269
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VI Changes in scope of consolidation (Continued)
3. Establishment of subsidiaries
31 December 2020 2020
Net assets Net profit
Guoda Wanmin Huimin Kangwei Pharmacy Lvliang Co., Ltd. (a) - -
Sinopharm Holding Guoda Jianfeng (Jiangmen) Pharmaceutical Chain Co.,
Ltd. (b) 73.55 73.55
Liaoning Huludao Guoda Pharmacy Co., Ltd. (c) - -
Liaoning Guoda Pharmacy Chain Co., Ltd. (d) 22,661,064.13 2,661,064.13
Jinzhong Yuci Guoda Wanmin Clinic Co., Ltd. (e) - -
Guoda Pharmacy (Rizhao) Co., Ltd. (f) 1,500,810.31 810.31
Liaoning Guoda Health Pharmacy Co., Ltd. (g) 7,653,438.02 2,653,438.02
(a) On 28 December 2020, the Group and Wenshui Weikang Trading Co., Ltd. accumulatively invested RMB16,320.00
thousand and RMB15,680.00 thousand to set up Guoda Wanmin Huimin Kangwei Pharmacy Lvliang Co., Ltd.,
respectively. After the establishment, the Group held 51% of equity interest in the company. As at the end of 2020,
payment has not been completed yet.
(b) On 26 December 2020, the Group and Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. accumulatively
invested RMB6,385.10 thousand and RMB6,134.70 thousand to set up Guoda Jianfeng (Jiangmen)
Pharmaceutical Chain Co., Ltd., respectively. After the establishment, the Group held 51% of equity interest in the
company. As at the end of 2020, payment has not been completed yet.
(c) On 14 December 2020, the Group invested RMB1,000.00 thousand to establish Liaoning Huludao Guoda
Pharmacy Co., Ltd. As at the end of 2020, payment has not been completed yet.
(d) On 3 August 2020, the Group invested RMB20,000.00 thousand to establish Liaoning Guoda Pharmacy Co., Ltd.
On 13 September 2020, the company was renamed as Liaoning Guoda Pharmacy Chain Co., Ltd. As at the end of
2020, payment has been completed.
(e) On 6 July 2020, the Group invested RMB100.00 thousand to establish Jinzhong Yuci Guoda Wanmin Clinic Co.,
Ltd. As at the end of 2020, payment has not been completed yet.
(f) On 3 June 2020, the Group invested RMB1,500.00 thousand to establish Guoda Pharmacy (Rizhao) Co., Ltd. As at
the end of 2020, payment has been completed.
(g) On 13 March 2020, the Group invested RMB5,000.00 thousand to establish Liaoning Guoda Health Pharmacy Co.,
Ltd. As at the end of 2020, payment has been completed.
270
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities
1. Interests in subsidiaries
The subsidiaries of the Group
Principal Place of Nature of Registered Shareholding Voting Ways of
Subsidiaries place of establishment business capital proportion acquisition
Direct Indirect
business (RMB’0.000)
Sinopharm Guilin Guilin Guilin Commercial 2,000.00 - 100.00% 100.00% Establishment
Sinopharm Baise Baise Baise Commercial 3,500.00 - 100.00% 100.00% Establishment
Sinopharm Holding
Zhongshan Co.,
Ltd. Zhongshan Zhongshan Commercial 3,000.00 - 100.00% 100.00% Establishment
Sinopharm Guigang Guigang Guigang Commercial 2,000.00 - 100.00% 100.00% Establishment
Sinopharm Beihai Beihai Beihai Commercial 1,500.00 - 100.00% 100.00% Establishment
Sinopharm Holding
Guangzhou
Medical
Treatment Co.,
Ltd. Guangzhou Guangzhou Commercial 2,000.00 - 51.00% 51.00% Establishment
Sinopharm Holding
Shenzhen
Jianmin Business
Pharmaceutical combinations
Co., Ltd. involving entities
(“Sinopharm under common
Jianmin") Shenzhen Shenzhen Commercial 2,000.00 100.00% - 100.00% control
Sinopharm Holding
Shenzhen
Traditional &
Herbal Medicine Business
Co., Ltd. combinations
(“Sinopharm involving entities
Traditional & under common
Herbal Medicine") Shenzhen Shenzhen Commercial 1,500.00 100.00% - 100.00% control
Sinopharm Holding Business
Shenzhen combinations
Logistics Co., Ltd. involving entities
(“Shenzhen under common
Logistics") Shenzhen Shenzhen Services 500.00 100.00% - 100.00% control
Business
combinations
involving entities
Sinopharm under common
Guangzhou Guangzhou Guangzhou Commercial 355,325.00 100.00% - 100.00% control
Business
Sinopharm Holding combinations
Guangdong involving entities
Hengxing Co., under common
Ltd. Guangzhou Guangzhou Commercial 9,600.00 - 100.00% 100.00% control
Business
combinations
involving entities
under common
Sinopharm Yulin Yulin Yulin Commercial 1,000.00 - 100.00% 100.00% control
Business
combinations
involving entities
under common
Sinopharm Liuzhou Liuzhou Liuzhou Commercial 2,053.06 - 51.00% 51.00% control
Business
combinations
Guangdong Huixin involving entities
Investment Co., under common
Ltd. Guangzhou Guangzhou Services 500.00 - 100.00% 100.00% control
271
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Principal Place of Nature of Registered Shareholding Voting Ways of
Subsidiaries place of establishment business capital proportion acquisition
Direct Indirect
business (RMB’0.000)
Business
combinations
involving entities
Sinopharm Holding under common
Foshan Co., Ltd. Foshan Foshan Commercial 4,100.00 - 100.00% 100.00% control
Sinopharm Holding Business
Guangdong combinations
Yuexing Co., involving entities
Ltd. (“Sinopharm under common
Yuexing”) Guangzhou Guangzhou Commercial 23,000.00 - 100.00% 100.00% control
Business
Sinopharm Holding combinations
Guangdong involving entities
Logistics Co., under common
Ltd. Guangzhou Guangzhou Services 1,300.00 - 100.00% 100.00% control
Business
combinations
involving entities
under common
Sinopharm Guangxi Nanning Nanning Commercial 52,141.00 100.00% - 100.00% control
Business
combinations
involving entities
under common
Guangxi Logistic Nanning Nanning Services 71,007.00 - 100.00% 100.00% control
Business
combinations
involving entities
under common
Sinopharm Wuzhou Wuzhou Wuzhou Commercial 1,000.00 - 99.90% 99.90% control
Business
combinations
involving entities
Sinopharm not under
Dongguan Dongguan Dongguan Commercial 7,300.00 - 100.00% 100.00% common control
Business
combinations
involving entities
Sinopharm not under
Zhanjiang Zhanjiang Zhanjiang Commercial 13,100.00 - 100.00% 100.00% common control
Business
combinations
involving entities
not under
Sinopharm Yanfeng Shenzhen Shenzhen Commercial 3,000.00 51.00% - 51.00% common control
Business
combinations
involving entities
not under
Sinopharm Meizhou Meizhou Meizhou Commercial 4,800.00 - 100.00% 100.00% common control
Business
combinations
involving entities
not under
Sinopharm Huizhou Huizhou Huizhou Commercial 3,800.00 - 100.00% 100.00% common control
Business
combinations
involving entities
Sinopharm not under
Zhaoqing Zhaoqing Zhaoqing Commercial 4,000.00 - 100.00% 100.00% common control
272
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Principal Place of Nature of Registered Shareholding Voting Ways of
Subsidiaries place of establishment business capital proportion acquisition
business (RMB’0,000) Direct Indirect
Business
combinations
involving entities
Sinopharm not under
Jiangmen Jiangmen Jiangmen Commercial 6,000.00 - 100.00% 100.00% common control
Business
combinations
involving entities
Sinopharm not under
Shaoguan Shaoguan Shaoguan Commercial 360.00 - 70.00% 70.00% common control
Business
combinations
involving entities
Sinopharm Holding not under
Shantou Co., Ltd. Shantou Shantou Commercial 2,100.00 - 100.00% 100.00% common control
Business
combinations
involving entities
under common
Foshan Nanhai Foshan Foshan Commercial 7,000.00 - 100.00% 100.00% control
Business
combinations
Foshan Nanhai involving entities
Uptodate & Special under common
Medicines Co., Ltd. Foshan Foshan Commercial 4,000.00 - 100.00% 100.00% control
Business
combinations
involving entities
Foshan Nanhai under common
Medicine Co., Ltd. Foshan Foshan Commercial 4,000.00 - 100.00% 100.00% control
Business
combinations
involving
Guangdong entities under
Uptodate & Special common
Medicines Guangzhou Guangzhou Commercial 5,000.00 - 100.00% 100.00% control
Business
combinations
involving entities
South Pharma & under common
Trade Guangzhou Guangzhou Commercial 3,000.00 - 100.00% 100.00% control
Business
combinations
involving entities
not under
Sinopharm Zhuhai Zhuhai Zhuhai Commercial 3,000.00 - 100.00% 100.00% common control
Sinopharm Holding
Guangzhou
Medical
Technology Co.,
Ltd. Guangzhou Guangzhou Commercial 588.00 - 51.00% 51.00% Establishment
Sinopharm Holding
Guangzhou
Medical Supply
Chain Service Co.,
Ltd. Guangzhou Guangzhou Commercial 2,000.00 - 51.00% 51.00% Establishment
Business
combinations
involving entities
Sinopharm Holding not under
Heyuan Co., Ltd. Heyuan Heyuan Commercial 1,340.00 - 70.00% 70.00% common control
Business
combinations
involving entities
under common
Guoda Drugstore Shanghai Shanghai Commercial 168,333.00 60.00% - 60.00% control
273
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
business (RMB‘0,000) Direct Indirect
Sinopharm Holding Business
Guoda combinations
Pharmacy involving
Shanghai Chain entities under
Co., Ltd. Shanghai Shanghai Commercial 3,000.00 - 100.00% 100.00% common control
Business
Beijing Guoda combinations
Pharmacy involving entities
Chain Store under common
Co., Ltd. Beijing Beijing Commercial 1,000.00 - 100.00% 100.00% control
Business
Tianjin Guoda combinations
Pharmacy involving entities
Chain Store under common
Co., Ltd. Tianjin Tianjin Commercial 1,000.00 - 80.00% 80.00% control
Business
Guangxi Guoda combinations
Pharmaceutical involving entities
Consulting under common
Chain Co., Ltd. Nanning Nanning Commercial 300.00 - 100.00% 100.00% control
Sinopharm Holding Business
Guoda combinations
Pharmacy involving entities
Guangdong Co., under common
Ltd. Shenzhen Shenzhen Commercial 5,000.00 - 100.00% 100.00% control
Business
Sinopharm Guoda combinations
Pharmacy involving entities
Guangxi Chain under common
Co., Ltd. Liuzhou Liuzhou Commercial 200.00 - 100.00% 100.00% control
Business
combinations
Zhejiang Guoda involving entities
Pharmacy Co., under common
Ltd. Hangzhou Hangzhou Commercial 1,500.00 - 100.00% 100.00% control
Sinopharm Holding
Guoda
Yangzhou Business
Dadesheng combinations
Pharmacy involving entities
Chain Store under common
Co., Ltd. Yangzhou Yangzhou Commercial 4,400.00 - 93.68% 93.68% control
Business
Ningxia Guoda combinations
Pharmacy involving entities
Chain Store under common
Co., Ltd. Yinchuan Yinchuan Commercial 7,000.00 - 70.00% 70.00% control
Sinopharm Holding Business
Guoda Nanjing combinations
Pharmacy involving entities
Chain Store under common
Co., Ltd. Nanjing Nanjing Commercial 800.00 - 60.00% 60.00% control
Sinopharm Holding Business
Guoda combinations
Shandong involving entities
Pharmacy Co., under common
Ltd. Linyi Linyi Commercial 2,900.00 - 55.00% 55.00% control
Business
combinations
involving entities
under common
Guoda Shenyang Shenyang Shenyang Commercial 5,000.00 - 51.00% 51.00% control
274
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
business (RMB‘0,000) Direct Indirect
Business
combinations
Fujian Guoda involving
Pharmacy Chain entities under
Store Co., Ltd. Xiamen Xiamen Commercial 3,750.00 - 100.00% 100.00% common control
Business
combinations
Anhui Guoda involving
Pharmacy Chain entities under
Store Co., Ltd. Hefei Hefei Commercial 1,000.00 - 60.00% 60.00% common control
Business
combinations
involving
entities under
Guoda Quanzhou Quanzhou Quanzhou Commercial 2,000.00 - 51.00% 51.00% common control
Business
combinations
involving
entities under
Shanxi Wanmin Taiyuan Taiyuan Commercial 2,000.00 - 85.00% 85.00% common control
Sinopharm Holding Business
Hunan Guoda combinations
Minshengtang involving
Pharmacy Chain entities under
Co., Ltd. Hengyang Hengyang Commercial 2,000.00 - 51.00% 51.00% common control
Business
Liyang Guoda combinations
People’s involving
Pharmacy Chain entities under
Store Co., Ltd. Liyang Liyang Commercial 2,500.00 - 80.00% 80.00% common control
Business
Sinopharm Holding combinations
Guoda Henan involving
Pharmacy Chain entities under
Store Co., Ltd. Pingdingshan Pingdingshan Commercial 1,500.00 - 60.00% 60.00% common control
Business
combinations
involving
Guoda Inner entities under
Mongolia Hohhot Hohhot Commercial 5,000.00 - 96.70% 96.70% common control
Business
combinations
involving
entities under
Hebei Lerentang Shijiazhuang Shijiazhuang Commercial 3,500.00 - 60.00% 60.00% common control
Business
Sinopharm Guoda combinations
Pharmacy involving
Jiangmen Chain entities under
Co., Ltd. Jiangmen Jiangmen Commercial 2,400.00 - 65.00% 65.00% common control
Sinopharm Holding Business
Guoda Shanxi combinations
Yiyuan Pharmacy involving
Chain Store Co., entities under
Ltd. Taiyuan Taiyuan Commercial 1,000.00 - 80.00% 80.00% common control
Business
combinations
Xinjiang New & involving
Special entities under
Medicines Urumqi Urumqi Commercial 612.24 - 51.00% 51.00% common control
275
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
Direct Indirect
business (RMB‘0,000)
Business
combinations
involving entities
under common
ForMe Medicines Shanghai Shanghai Commercial 6,655.00 - 97.00% 97.00% control
Business
combinations
involving entities
ForMe Pharmacy under common
Chain Store Shanghai Shanghai Commercial 5,000.00 - 99.76% 99.76% control
Business
Beijing Golden combinations
Elephant involving entities
Pharmacy Chain under common
Co., Ltd. Beijing Beijing Commercial 4,222.22 - 53.13% 53.13% control
Business
combinations
Shanxi Tongfeng involving entities
Pharmacy under common
Logistics Co., Ltd. Taiyuan Taiyuan Commercial 500.00. - 100.00% 100.00% control
Business
Changzhi Guoda combinations
Wanmin involving entities
Pharmacy Chain under common
Store Co., Ltd. Changzhi Changzhi Commercial 320.00 - 51.00% 51.00% control
Business
Shanxi Guoda combinations
Wanmin Clinic involving entities
Management Medical under common
Chain Co., Ltd. Taiyuan Taiyuan services 120.00 - 100.00% 100.00% control
Business
Shanghai Guoda combinations
Shanghong involving entities
Qibao Pharmacy under common
Co., Ltd. Shanghai Shanghai Commercial 100.00 - 51.00% 51.00% control
Business
Zhejiang Sinopharm combinations
Pharmacy involving entities
Dongshan Drug under common
Store Co., Ltd. Hangzhou Hangzhou Commercial 50.00 - 51.00% 51.00% control
Business
Shanghai Guoda combinations
Dongsheng involving entities
Pharmacy Co., under common
Ltd. Shanghai Shanghai Commercial 50.00 - 100.00% 100.00% control
Business
Sinopharm Guoda combinations
Drug Store involving entities
(Shenzhen) under common
Chain Co., Ltd. Shenzhen Shenzhen Commercial 1,080.00 - 100.00% 100.00% control
Business
Sinopharm Holding combinations
Guoda Pharmacy involving entities
Guangzhou under common
Chain Co., Ltd. Guangzhou Guangzhou Commercial 200.00 - 100.00% 100.00% control
Shanghai Guodong Business
Chinese combinations
Traditional involving entities
Medicine Clinic Medical under common
Co., Ltd. Shanghai Shanghai clinic 20.00 - 100.00% 100.00% control
Business
Shanghai Guoda combinations
Dongxin involving entities
Pharmacy Chain under common
Store Co., Ltd. Shanghai Shanghai Commercial 30.00 - 100.00% 100.00% control
276
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal place Place of Nature of Registered Shareholding Voting Ways of
of business establishment business capital proportion acquisition
(RMB‘0,000) Direct Indirect
Shanghai Yutaitang Business
Chinese combinations
Traditional involving entities
Medicine Clinic under common
Co., Ltd. Shanghai Shanghai Commercial 100.00 - 100.00% 100.00% control
Business
Sanhe Liyang combinations
Golden Elephant involving entities
Pharmacy Co., under common
Ltd. Langfang Langfang Commercial 1.00 - 100.00% 100.00% control
Business
Sinopharm Holding combinations
Guoda Pharmacy involving entities
Hulun Buir Co., under common
Ltd. Hulun Buir Hulun Buir Commercial 1000.00 - 51.00% 51.00% control
Business
combinations
Shanghai ForMe involving entities
Xuhui Pharmacy under common
Co., Ltd. Shanghai Shanghai Commercial 25.00 - 100.00% 100.00% control
Sinopharm Holding
Ulanqab Co., Ltd. Ulanqab Ulanqab Commercial 500.00 - 60.00% 60.00% Establishment
Business
combinations
involving entities
under common
Guoda Taishan Taishan Taishan Commercial 990.00 - 70.00% 70.00% control
Sinopharm Business
Lerentang combinations
Shijiazhuang involving entities
Pharmaceutical under common
Co., Ltd. Shijiazhuang Shijiazhuang Commercial 200.00 - 100.00% 100.00% control
Sinopharm Holding
Guoda Drug
Store Manchuria
Co., Ltd. Manchuria Manchuria Commercial 50.00 - 51.00% 51.00% Establishment
Sinopharm Guoda
Drug Store
Anshan Chain
Co., Ltd. Anshan Anshan Commercial 600.00 - 51.00% 51.00% Establishment
Sinopharm Holding
Guoda
Yongsheng Drug
Store (Shanghai)
Co., Ltd. Shanghai Shanghai Commercial 80.00 - 55.00% 55.00% Establishment
Sinopharm Holding
Foshan Medical
Consumables
Supply Chain
Co., Ltd. Foshan Foshan Commercial 800.00 - 70.00% 70.00% Establishment
Sinopharm Holding
Medical Supply
Chain Service
(Guangxi) Co.,
Ltd. Nanning Nanning Commercial 2000.00 - 30.60% 60.00% Establishment
Shanghai Guoda
Haohai Pharmacy
Co., Ltd. Shanghai Shanghai Commercial 80.00 - 51.00% 51.00% Establishment
Sinopharm Holding
Baiyi Pharmacy
Guangxi Co., Ltd. Nanning Nanning Commercial 200.00 - 51.00% 51.00% Establishment
277
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
business (RMB‘0,000) Direct Indirect
Sinopharm Holding
Hezhou Co., Ltd. Hezhou Hezhou Commercial 1000.00 - 100.00% 100.00% Establishment
Sinopharm Holding
Guoda Pharmacy
Zhengzhou Chain
Store Co., Ltd Zhengzhou Zhengzhou Commercial 2000.00 - 60.00% 60.00% Establishment
Shanghai Guoda
Ruijing Pharmacy
Co., Ltd. Shanghai Shanghai Commercial 80.00 - 55.00% 55.00% Establishment
Fujian Guoda
Pharmaceutical
Co., Ltd. Xiamen Xiamen Commercial 1500.00 - 100.00% 100.00% Establishment
Sinopharm Holding
Qinzhou Co., Ltd. Qinzhou Qinzhou Commercial 1000.00 - 100.00% 100.00% Establishment
Sinopharm Holding
Hechi Co., Ltd. Hechi Hechi Commercial 1000.00 - 100.00% 100.00% Establishment
Business
combinations
Sinopharm Holding involving entities
Guangzhou not under
Huadu Co., Ltd. Guangzhou Guangzhou Commercial 1000.00 - 70.00% 70.00% common control
Business
Sinopharm Holding combinations
Guoda Shanxi involving entities
Pharmaceutical not under
Co., Ltd. Taiyuan Taiyuan Commercial 1000.00 - 100.00% 100.00% common control
Business
combinations
involving entities
not under
Taiyuan Tongxinli Taiyuan Taiyuan Commercial 560.00 - 100.00% 100.00% common control
Sinopharm Holding
Guoda Pharmacy
Bayannur Co.,
Ltd. Bayannur Bayannur Commercial 2,000.00 - 80.00% 80.00% Establishment
Inner Mongolia
Guoda
Pharmaceutical
Co., Ltd. Hohhot Hohhot Commercial 2,000.00 - 100.00% 100.00% Establishment
Guoda
Yongxingtang. Chaoyang Chaoyang Commercial 3,800.00 - 51.00% 51.00% Establishment
Sinopharm Accord
Medical Supply
Chain
(Shenzhen) Co.,
Ltd. Shenzhen Shenzhen Commercial 3,333.00 60.00% - 60.00% Establishment
Liaoning Guoda
Pharmaceutical
Co., Ltd. Shenyang Shenyang Commercial 2,000.00 - 100.00% 100.00% Establishment
Sinopharm Holding
Guangyi Health
Management
(Zhanjiang) Co.,
Ltd. Zhanjiang Zhanjiang Commercial 50.00 - 60.00% 60.00% Establishment
Business
combinations
involving entities
Guangzhou not under
Medicine Guangzhou Guangzhou Commercial 200.00 - 70.00% 70.00% common control
Business
combinations
involving entities
not under
Chaoyang Renai Chaoyang Chaoyang Commercial 50.00 - 51.00% 51.00% common control
278
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
business (RMB‘0,000) Direct Indirect
Business
combinations
involving entities
not under
Guoda Pu’er Pu’er Pu’er Commercial 500.00 - 60.00% 60.00% common control
Guoda Wanmin
Huimin Kangwei
Pharmacy
Lvliang Co., Ltd.
(a) Lvliang Lvliang Commercial 3,200.00 - 51.00% 51.00% Establishment
Guoda Jianfeng
(Jiangmen)
Pharmaceutical
Chain Co., Ltd.
(b) Jiangmen Jiangmen Commercial 1,251.97 - 51.00% 51.00% Establishment
Liaoning Huludao
Guoda
Pharmacy Co.,
Ltd. (c) Huludao Huludao Commercial 100.00 - 100.00% 100.00% Establishment
Business
combinations
involving entities
Yangjiang Medicine not under
(d) Yangjiang Yangjiang Commercial 1,000.00 - 70.00% 70.00% common control
Liaoning Guoda
Pharmacy Chain
Co., Ltd. (e) Dalian Dalian Commercial 2,000.00 - 100.00% 100.00% Establishment
Business
combinations
involving entities
not under
CDFY (f) Shenyang Shenyang Commercial 23,000.00 - 100.00% 100.00% common control
Business
Shandong Chengda combinations
Fangyuan involving entities
Pharmaceutical not under
Chain Co., Ltd. Qingdao Qingdao Commercial 5,000.00 - 100.00% 100.00% common control
Business
Liaoning Chengda combinations
Fangyuan involving entities
Pharmacy not under
Chains Co., Ltd. Shenyang Shenyang Commercial 8,000.00 - 100.00% 100.00% common control
Business
Liaoning Zhicheng combinations
Xingda involving entities
Advertising not under
Media Co., Ltd. Benxi Benxi services 500.00 - 100.00% 100.00% common control
Chengda Fangyuan Business
(Liaoning) New combinations
and Special involving entities
Drugs Chain Co., not under
Ltd. Shenyang Shenyang Commercial 5,000.00 - 80.00% 80.00% common control
Liaoning Chengda Business
Fangyuan combinations
Vocational and involving entities
Technical not under
Training School Shenyang Shenyang services 200.00 - 100.00% 100.00% common control
Business
Liaoning Chengda combinations
Fangyuan involving entities
Medicine Co., not under
Ltd. Shenyang Shenyang Commercial 5,000.00 - 100.00% 100.00% common control
279
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
business (RMB‘0,000) Direct Indirect
Business
combinations
Dalian Zhengda involving entities
Pharmaceutical not under
Co., Ltd. Dalian Dalian Commercial 500.00 - 100.00% 100.00% common control
Business
Hebei Chengda combinations
Fangyuan involving entities
Pharmaceutical not under
Chain Co., Ltd. Qinghuangdao Qinghuangdao Commercial 2,000.00 - 100.00% 100.00% common control
Liaoning Chengda Business
Fangyuan combinations
Pharmaceutical involving entities
Logistics Co., not under
Ltd. Shenyang Shenyang services 1,500.00 - 100.00% 100.00% common control
Business
Liaoning Chengda combinations
Fangyuan involving entities
Logistics Co., not under
Ltd. Shenyang Shenyang services 200.00 - 100.00% 100.00% common control
Business
Jilin Chengda combinations
Fangyuan involving entities
Pharmaceutical not under
Co., Ltd. Changchun Changchun Commercial 1,000.00 - 80.00% 80.00% common control
Business
Jilin Chengda combinations
Fangyuan involving entities
Pharmaceutical not under
Chain Co., Ltd. Changchun Changchun Commercial 500.00 - 99.00% 99.00% common control
Inner Mongolia Business
Chengda combinations
Fangyuan involving entities
Medicine Co., not under
Ltd. Chifeng Chifeng Commercial 400.00 - 70.00% 70.00% common control
Inner Mongolia Business
Chengda combinations
Fangyuan involving entities
Pharmaceutical not under
Chain Co., Ltd. Chifeng Chifeng Commercial 200.00 - 99.00% 99.00% common control
Sinopharm Holdings
Guozhi
Pharmacy Chain
(Heyuan) Co.,
Ltd. (g) Heyuan Heyuan Commercial 500.00 - 70.00% 70.00% Establishment
Jinzhong Yuci
Guoda Wanmin
Clinic Co., Ltd.
(h) Jinzhong Jinzhong Commercial 10.00 - 100.00% 100.00% Establishment
Business
combinations
involving entities
Sinopharm Maoming not under
(i) Maoming Maoming Commercial 6,000.00 - 100.00% 100.00% common control
Guoda Pharmacy
(Rizhao) Co.,
Ltd. (j) Rizhao Rizhao Commercial 150.00 100.00% 100.00% Establishment
Business
combinations
involving entities
under common
Xiaoyi Wanmin (k) Xiaoyi Xiaoyi Commercial 622.22 - 70.00% 70.00% control
Business
combinations
involving entities
Golden Elephant not under
Guoxing (l) Beijing Beijing Commercial 50.00 - 100.00% 100.00% common control
Liaoning Guoda
Health Pharmacy
Co., Ltd. (m) Shenyang Shenyang Commercial 500.00 - 100.00% 100.00% Establishment
280
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Subsidiaries Principal Place of Nature of Registered Shareholding Voting Ways of
place of establishment business capital proportion acquisition
business (RMB‘0,000) Direct Indirect
Business
combinations
involving entities
Shanghai Dingqun not under
(n) Shanghai Shanghai services 79,050.00 - 100.00% 100.00% common control
Business
Sinopharm Holding combinations
Tianhe Jilin involving entities
Pharmaceutical not under
Co., Ltd. Changchun Changchun Commercial 2,155.67 - 85.00% 85.00% common control
Business
combinations
involving entities
Jilin Yihe Drug Store not under
Co., Ltd. Changchun Changchun Commercial 500.00 - 100.00% 100.00% common control
Business
combinations
Jilin Donglong involving entities
Pharmaceutical not under
Logistics Co., Ltd. Changchun Changchun Commercial 500.00 - 100.00% 100.00% common control
Yushu City Dinghe Business
Medical combinations
Pharmaceutical involving entities
Technology Co., not under
Ltd. Changchun Changchun Commercial 500.00 - 51.00% 51.00% common control
Business
combinations
involving entities
Guoda Pharmacy not under
Jilin Co., Ltd Changchun Changchun Commercial 500.00 - 100.00% 100.00% common control
Business
combinations
Yanji City Xianghe involving entities
Pharmaceutical not under
Co., Ltd Yanji Yanji Commercial 1,000.00 - 51.00% 51.00% common control
Business
combinations
involving entities
under common
Pudong Medicine (o) Shanghai Shanghai Commercial 1,389.55 - 75.00% 75.00% control
Shanghai
Yanghetang Business
Pharmaceutical combinations
Chain involving entities
Management Co., under common
Ltd. Shanghai Shanghai Commercial 682.15 - 100.00% 100.00% control
Business
Shanghai Pudong combinations
Yanghetang involving entities
Chinese Medicine under common
Clinic Co., Ltd. Shanghai Shanghai Commercial 50.00 - 100.00% 100.00% control
281
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
The subsidiaries of the Group (Continued)
(a) On 28 December 2020, the Group and Wenshui Weikang Trading Co., Ltd. accumulatively invested
RMB16,320.00 thousand and RMB15,680.00 thousand to set up Guoda Wanmin Huimin Kangwei
Pharmacy Lvliang Co., Ltd., respectively. After the establishment, the Group held 51% of equity in the
company. As at the end of 2020, payment has not been completed yet.
(b) On 26 December 2020, the Group and Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd.
accumulatively invested RMB6,385.10 thousand and RMB6,134.70 thousand to set up Guoda Jianfeng
(Jiangmen) Pharmaceutical Chain Co., Ltd., respectively. After the establishment, the Group held 51% of
equity interest in the company. As at the end of 2020, payment has not been completed yet.
(c) On 14 December 2020, the Group invested RMB1,000.00 thousand to set up Liaoning Huludao Guoda
Pharmacy Co., Ltd. As at the end of 2020, payment has not been completed yet.
(d) On 31 October 2020, the Group acquired 70% equity of Yangjiang Medicine from Zhang Haiyan and Huang
Zhiqiang for RMB18.10 thousand, which formed a business combination not involving enterprises under
common control. The acquisition was completed on 31 October 2020 and was included in the scope of
consolidation.
(e) On 3 August 2020, the Group invested RMB20,000.00 thousand to set up Liaoning Guoda Pharmacy Co.,
Ltd. On 13 September 2020, Liaoning Guoda Pharmacy Co., Ltd. was renamed as “Liaoning Guoda
Pharmacy Chain Co., Ltd.” As at the end of 2020, payment has been completed.
(f) On 31 July 2020, the Group acquired 100% equity in CDFY Pharmaceutical Chain Investment Co., Ltd.
from Liaoning Chengda Co., Ltd. for RMB1,860,000.00 thousand, which formed a business combination
not involving enterprises under common control. The acquisition was completed on 31 July 2020 and was
included in the scope of consolidation.
(g) On 9 July 2020, Sinopharm Holdings Guozhi Pharmacy (Heyuan) Co., Ltd. was renamed as “Sinopharm
Holdings Guozhi Pharmacy Chain (Heyuan) Co., Ltd.”
(h) On 6 July 2020, the Group invested RMB100.00 thousand to set up Jinzhong Yuci Guoda Wanmin Clinic
Co., Ltd. As at the end of 2020, payment has not been completed yet.
(i) On 22 June 2020, the registered capital of Sinopharm Maoming was changed from RMB2,000.00 thousand
to RMB60,000.00 thousand. After the change, the Group subscribed RMB60,000.00 thousand of registered
capital. As at the end of 2020, payment has been completed.
(j) On 3 June 2020, the Group invested RMB1,500.00 thousand to set up Guoda Pharmacy (Rizhao) Co., Ltd.
As at the end of 2020, payment has been completed.
282
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1． Interests in subsidiaries (Continued)
The subsidiaries of the Group (Continued)
(k) On 12 May 2020, Xiaoyi City Guoda Wanmin Baicaotang Pharmacy Co., Ltd. was renamed as “Xiaoyi City
Guoda Wanmin Baicaotang Pharmacy Chain Store Co., Ltd.”
(l) On 2 April 2020, the Group acquired 100% equity in Golden Elephant Guoxing from Beijing Golden
Elephant Fosun Pharmaceutical Co., Ltd. for RMB10.00 thousand, which formed a business combination
not involving enterprises under common control. The acquisition was completed on 2 April 2020 and was
included in the scope of consolidation.
(m) On 13 March 2020, the Group invested RMB5,000.00 thousand to set up Liaoning Guoda Health
Pharmacy Co., Ltd. As at the end of 2020, payment has been completed.
(n) On 7 January 2020, Guoda Drugstore, a subsidiary of the Group, acquired 97.47% equity from Ningbo
Meishan Bonded Port Area Qiling Equity Investment Center LP and 2.53% equity from the Company. The
total consideration paid was RMB934,240.00 thousand, which formed a business combination not
involving enterprises under common control and included in the scope of consolidation of the Company.
The registered capital of Shanghai Dingqun is RMB790,500 thousand, and the Company has made
retroactive payment of RMB395,250 thousand this year. As at the end of 2020, the capital contribution has
been completed.
(o) On 2 January 2020, the Group acquired 75% equity in Pudong Medicine from Sinopharm Group for
RMB163,115 thousand to control Pudong Medicine, which formed a business combination not involving
enterprises under common control. The acquisition was completed on 2 January 2020 and was included
in the scope of consolidation.
283
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
1． Interests in subsidiaries (Continued)
Details of the Group’s subsidiaries that have material non-controlling interests are set out below:
2020
Percentage of Profit Dividend paid to Accumulated balances of
equity interest for this year non-controlling non-controlling interests at
held by attributable to interests the date of the balance
non-controlling non-controlling sheet
interests interests
Guoda
Drugstore 40.00% 136,490,577.03 56,663,076.06 1,948,921,041.02
The major financial information of the subsidiaries in the table above is stated below. These amounts are
before elimination:
Guoda Drugstore
2020
Current assets 8,886,545,970.79
Non-current assets 6,570,327,751.04
Total assets 15,456,873,721.83
Current liabilities 8,541,421,518.15
Non-current liabilities 1,375,989,559.14
Total liabilities 9,917,411,077.29
Operating revenue 19,437,660,100.65
Net profit 476,588,088.95
Total comprehensive income 464,188,594.16
Net cash flows from operating activities 2,002,315,496.43
284
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
2. Interests in associates
Principal
place of Place of Nature of business Shareholding (%)
business incorporation Accounting
Direct Indirect
Associates
Main Luck Pharmaceutical Shenzhen Shenzhen Manufacturing 35.19 - Equity
Zhijun Suzhou Suzhou Suzhou Manufacturing 33.00 - Equity
Zhijun Medicine Shenzhen Shenzhen Manufacturing 49.00 - Equity
Zhijun Trade Shenzhen Shenzhen Commercial 49.00 - Equity
Zhijun Pingshan Shenzhen Shenzhen Manufacturing 49.00 - Equity
Shyndec Pharma Shanghai Shanghai Manufacturing 16.28 - Equity
Shanghai Beiyi Shanghai Shanghai Commercial - 26.00 Equity
Shanghai Liyi Shanghai Shanghai Commercial - 35.00 Equity
Guangdong Jienuo Guangzhou Guangzhou Commercial - 29.00 Equity
Dongyuan Accord Heyuan Heyuan Commercial - 45.00 Equity
Shanghai Renbei Shanghai Shanghai Commercial - 30.00 Equity
Guangdong Jianhui Zhanjiang Zhanjiang Commercial - 10.00 Equity
Shyndec Pharma and Zhijun Medicine are important associates of the Group and are engaged in
the production as well as sale of pharmaceutical products. The Group adopted the equity method
for Shyndec Pharma, Main Luck Pharmaceutical and Zhijun Medicine.
285
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
2. Interests in associates (Continued)
The following table illustrates the summarised financial information in respect of Shyndec
Pharma:
2020 2019
Current assets 10,162,475,190.65 9,676,372,530.32
Non-current assets 8,087,979,595.07 7,962,091,231.68
Total assets 18,250,454,785.72 17,638,463,762.00
Current liabilities 6,194,362,158.11 6,491,804,082.54
Non-current liabilities 2,236,726,740.99 1,943,465,618.97
Total liabilities 8,431,088,899.10 8,435,269,701.51
Non-controlling interests 1,688,157,191.81 1,615,724,166.23
Shareholders’ equity attributable to
shareholders of the parent
company 8,131,208,694.81 7,587,469,894.26
Group’s share of net assets by
proportion of ownership interests 1,323,760,775.52 1,235,240,098.79
Carrying amount of the investment 1,323,760,775.52 1,235,240,098.79
Operating revenue 12,556,281,595.67 12,199,106,725.48
Income taxes 141,079,935.05 144,388,214.81
Net profit 900,046,866.22 928,467,067.03
Total comprehensive income 900,079,623.42 927,647,864.36
Dividend received 16,714,220.20 16,714,220.15
286
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
2. Interests in associates (Continued)
The following table illustrates the summarised financial information in respect of Main Luck
Pharmaceutical:
2020 2019
Current assets 1,076,146,345.00 1,133,984,032.16
Non-current assets 124,495,504.04 133,620,370.43
Total assets 1,200,641,849.04 1,267,604,402.59
Current liabilities 275,509,215.17 424,300,988.22
Non-current liabilities 8,120,000.00 6,504,985.11
Total liabilities 283,629,215.17 430,805,973.33
Shareholders’ equity attributable to
shareholders of the parent
company 917,012,633.87 836,798,429.26
Group’s share of net assets by
proportion of ownership interests 322,696,745.87 294,469,367.27
Carrying amount of the investment 322,696,745.87 294,469,367.27
Operating revenue 1,044,631,857.57 1,530,343,275.53
Income taxes 44,375,861.78 43,327,280.21
Net profit 260,214,204.60 250,509,854.41
Total comprehensive income 260,214,204.60 250,509,854.41
Dividend received 63,342,000.00 58,063,500.00
287
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VII Interests in other entities (Continued)
2. Interests in associates (Continued)
The following table illustrates the summarised financial information in respect of Zhijun Medicine:
2020 2019
Current assets 1,176,812,039.37 1,295,003,085.13
Non-current assets 238,613,242.87 273,684,959.60
Total assets 1,415,425,282.24 1,568,688,044.73
Current liabilities 541,117,019.88 734,280,688.66
Non-current liabilities 5,822,904.95 16,900,060.78
Total liabilities 546,939,924.83 751,180,749.44
Shareholders’ equity attributable to
shareholders of the parent company 868,485,357.41 817,507,295.29
Group’s share of net assets by
proportion of ownership interests 425,557,825.11 400,578,574.68
Carrying amount of the investment 425,557,825.11 400,578,574.68
Operating revenue 1,364,530,022.63 1,888,143,854.90
Income taxes 20,277,618.43 34,538,098.81
Net profit 159,586,371.60 217,216,618.96
Total comprehensive income 159,586,371.60 217,216,618.96
Dividend received 53,218,071.65 61,210,764.76
288
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments
1. Classification of financial instruments
The carrying amounts of each category of financial instruments as at the date of financial position
are as follows:
2020
Financial assets
at fair value
Financial assets through profit Financial assets at fair value through
Financial assets at
or loss amortised cost other comprehensive income Total
Mandatorily Mandatorily
Designated
required required
Cash and cash
equivalents - 5,998,204,295.87 - - 5,998,204,295.87
Notes receivable - 622,115,477.04 - - 622,115,477.04
Accounts
receivable - 13,799,971,014.22 - - 13,799,971,014.22
Receivables
financing - - 1,404,987,700.38 - 1,404,987,700.38
Other receivables - 535,228,747.69 - - 535,228,747.69
Other non-current
financial assets 120,972,350.24 - - - 120,972,350.24
Other equity
instrument
investment - - - 99,488,340.28 99,488,340.28
120,972,350.24 20,955,519,534.82 1,404,987,700.38 99,488,340.28 22,580,967,925.72
Financial liabilities Financial liabilities at amortised cost
Short-term borrowings 1,612,187,020.12
Notes payable 7,520,165,274.69
Accounts payable 7,697,451,142.50
Other payables 1,599,166,881.14
Non-current liabilities due within 1 year 748,732,059.89
Lease liabilities 1,303,054,163.90
Long-term borrowings 31,637,173.89
20,512,393,716.13
289
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
1. Classification of financial instruments (Continued)
2019
Financial assets at
fair value
Financial assets through profit Financial assets at fair value through
Financial assets at
or loss amortised cost other comprehensive income Total
Mandatorily Mandatorily
Designated
required required
Cash and cash
equivalents - 8,885,729,250.47 - - 8,885,729,250.47
Notes receivable - 793,301,688.64 - - 793,301,688.64
Accounts
receivable - 10,712,983,544.18 - - 10,712,983,544.18
Receivables
financing - - 446,342,588.46 - 446,342,588.46
Other receivables - 501,958,841.43 - - 501,958,841.43
Other non-current
financial assets 140,000,000.00 - - - 140,000,000.00
Other equity
instrument
investment - - - 116,021,000.00 116,021,000.00
140,000,000.00 20,893,973,324.72 446,342,588.46 116,021,000.00 21,596,336,913.18
Financial liabilities Financial liabilities at amortised cost
Short-term borrowings 1,453,018,300.01
Notes payable 5,555,697,557.53
Accounts payable 6,703,967,826.54
Other payables 1,822,364,637.62
Non-current liabilities due within 1 year 611,917,847.37
Lease liabilities 1,208,453,029.51
17,355,419,198.58
290
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
2. Transfers of financial assets
Transferred financial assets that are not derecognised in their entirety
As at 31 December 2020, the Group had endorsed commercial acceptance bills (the "Endorsed
Bills") with a carrying amount of RMB4,095,283.92 (31 December 2019: nil) to certain of its
suppliers to settle accounts payable due to such suppliers and the Group had endorsed bank
acceptance bills with a carrying amount of RMB23,843,867.66 (31 December 2019: nil) to
certain of its suppliers to settle accounts payable due to such suppliers. As at 31 December
2020, the Group had discounted commercial acceptance bills (the “Discounted Bills”) with a
carrying amount of RMB0.00 (31 December 2019: RMB64,038,348.12) to banks. In the opinion
of the Group, the Group has retained substantially all the risks and rewards, which include
default risks relating to such Endorsed Bills and Discounted Bills. Accordingly, it continued to
recognise the full carrying amounts of those Bills and the associated accounts payable settled.
Subsequent to the Endorsement and Discount, the Group did not retain any rights on the use of
those Bills, including the sale, transfer or pledge of those Bills to any other third parties.
As at 31 December 2020, the total carrying value of accounts payable settled by the Group was
RMB27,939,151.58 (31 December 2019: RMB64,038,348.12).
291
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
2. Transfers of financial assets (Continued)
Transferred financial assets that are derecognised in their entirety in which continuing
involvement exists
As at 31 December 2020, the Group had endorsed bank acceptance bills (the "Endorsed Bills")
with a carrying amount of RMB1,283,369,787.75 (31 December 2019: RMB867,007,837.74) to
certain of its suppliers to settle accounts payable due to such suppliers. As at 31 December
2020, the Group had discounted bank acceptance bills (the "Discounted Bills") with a carrying
amount of RMB330,472,883.05 (31 December 2019: RMB1,413,116,120.20) to banks. As at 31
December 2020, those Bills had a maturity of 1 to 12 months at the end of the reporting period.
In accordance with the Law of Negotiable Instruments, the holders of the derecognised bills
have a right of recourse against the Group if the accepting banks default (the "Continuing
Involvement"). In the opinion of the Group, the Group has transferred substantially all risks
and rewards relating to those Bills. Accordingly, it has derecognised the full carrying amounts of
those Bills and the associated accounts payable. The maximum exposure to loss from the
Group's Continuing Involvement in the derecognised bills and the undiscounted cash flows to
repurchase these derecognised bills is equal to their carrying amounts. In the opinion of the
Group, the fair values of the Group’s Continuing Involvement in the derecognised bills are not
significant.
During 2020, the Group has not recognised any gain or loss on the date of transfer. The Group
has no income or expense recognised in the current year and accumulated due to Continuing
Involvement in the derecognised financial assets. The endorsement has been made evenly
throughout the year.
During 2020, the Group has not recognised any gain or loss on the date of transfer of the
derecognised bills. No gains or losses were recognised from the Continuing Involvement, both
during the year or cumulatively.
As part of its normal business, the Group entered into an accounts receivable factoring without
recourse with banks and transferred certain accounts receivable to banks. In the opinion of the
Group, the Group has transferred substantially all risks and rewards under the arrangement.
Accordingly, it has derecognised the full carrying amounts of the associated accounts
receivable. The original carrying value of the derecognised accounts receivable transferred
under the arrangement that have not been settled as at 31 December 2020 amounted to
RMB1,409,768,709.18 (31 December 2019: RMB1,525,687,080.99).
292
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments
The main risks arising from the Group's financial instruments are credit risk, liquidity risk and
market risk (including currency risk and interest rate risk). The Group's principal financial
instruments comprise cash and bank balances, equity investments, debt investments, borrowings,
notes receivable, accounts receivable, notes payable and accounts payable. Risks related to
these financial instruments and the Group's risk management strategies for reducing these risks
are shown below.
The Company’s board of directors is 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 measures. 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 numerous aspects such as
market risk, credit risk and liquidity risk management, etc. 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 working group led by the management of the Company in accordance with the
risk management policies of SASAC, CNPGC and Sinopharm Group, through close collaboration
with other business units of the Group to identify, evaluate and avoid related risks.
To avoid the risk of concentrating on a single industry, a specific area or a specific counterparty,
the Group spreads risks of financial instruments with diversified investments and business
portfolios.
Credit risk
The Group only trades with recognised and creditworthy third parties. In accordance with the
Group's policy, credit review is required for all customers requiring credit transactions. In addition,
the Group continuously monitors the balance of accounts receivable to ensure that the Group is
not exposed to significant bad debt risk. For transactions that are not denominated in the
functional currency of the relevant operating unit, the Group does not offer credit terms without
the special approval of the credit control department of the Group.
Since cash and bank balances, bank acceptance bills receivable and derivative financial
instruments are placed in the well-established 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 balances and other
receivables. The credit risk of these financial assets results from default of counterparty. The
maximum credit exposure equals to the book value of these instruments.
The maximum exposure to credit risk of the Group at each balance sheet date is the total amount
charged to the customers less the amount of the impairment provision.
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 accounts receivable are widely dispersed in
different sectors and industries. The Group does not hold any collateral or other credit
enhancements over its accounts receivable balances.
293
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Credit risk (Continued)
Determination of significant increase in credit risk
At each reporting date, the Group evaluates whether the credit risk of financial instruments has
increased significantly since initial recognition. When determining whether the credit risk of
financial instruments have increased significantly since initial recognition, the Group considers
reasonable and supportable information that is relevant and available without undue cost or effort,
including quantitative and qualitative information analysis based on the Group’s historical
experience, external credit risk assessment and forward-looking information. To determine the
change of expected default risk during the financial instrument’s entire lifetime, the Group
compares the default risk of the financial instrument on the balance sheet date and the initial
recognition date based on a single financial instrument or financial instrument portfolio with
similar default risk.
The Group determines that the credit risk of financial assets has significantly increased when one
or more quantitative or qualitative criteria are met:
(1) Quantitative criteria are mainly probability of default increasing more than a given % since
initial recognition;
(2) Qualitative criteria are mainly significant detrimental changes in the borrower’s operating or
financial conditions and early warning customer lists.
(3) The upper criterion is above 30 days of the borrowers default (including principal and
interests).
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:
(1) Significant financial difficulty of the borrower or issuer;
(2) A breach of contract such as a default or past due event;
(3) The lender(s) of the 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;
(4) It is becoming probable that the borrower will enter bankruptcy or other financial
reorganisation;
(5) The disappearance of an active market for security because of financial difficulties; and
(6) Financial assets purchased or sourced at large discounts indicating that credit losses have
occurred.
294
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Credit risk (Continued)
The impairment of financial assets may not be necessarily due to a single disparate 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 increase in credit risk and whether the financial assets are
credit-impaired, the Group recognises impairment allowance for different assets using either the
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 the counterparty rating, the
guarantee method, the collateral category, the repayment method, and also forward-looking
information.
Definitions:
(1) The probability of default is the probability that the debtor will not be able to meet its
repayment obligations within the following 12 months 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.
(2) 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 months or the entire duration.
(3) The exposure at default refers to the amount that the Group should repay in the event of
default in the next 12 months or throughout the remaining period.
Both the assessment of a significant increase in credit risk and the calculation of the ECL involve
forward-looking information. The Group recognises key economic ratios that influence credit risk
and the ECL by historical data analysis.
As at 31 December 2020, the Group had no significant overdue receivables (31 December 2019:
nil).
295
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Liquidity risk
The maturity analysis of the Group's financial liabilities as at the end of the reporting period, based on the contractual undiscounted cash flows, is as follows:
31 December 2020
Within 1 year 1 to 2 years 2 to 5 years Above 5 years Total
Short-term borrowings 1,630,237,831.47 - - - 1,630,237,831.47
Long-term borrowings - 1,216,600.00 32,313,062.78 - 33,529,662.78
Notes payable 7,520,165,274.69 - - - 7,520,165,274.69
Accounts payable 7,697,451,142.50 - - - 7,697,451,142.50
Other payables 1,599,166,881.14 - - - 1,599,166,881.14
Non-current liabilities due within 1 year 866,553,230.12 - - - 866,553,230.12
Lease liabilities - 607,074,838.58 682,420,061.05 86,860,654.77 1,376,355,554.40
19,313,574,359.92 608,291,438.58 714,733,123.83 86,860,654.77 20,723,459,577.10
296
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Liquidity risk (Continued)
The maturity analysis of the Group's financial liabilities as at the end of the reporting period, based on the contractual undiscounted cash flows, is as
follows:
31 December 2019
Within 1 year 1 to 2 years 2 to 5 years Above 5 years Total
-
Short-term borrowings 1,473,390,678.14 - - - 1,473,390,678.14
Notes payable 5,555,697,557.53 - - - 5,555,697,557.53
Accounts payable 6,703,967,826.54 - - - 6,703,967,826.54
Other payables 1,822,364,637.62 - - - 1,822,364,637.62
Non-current liabilities due within 1 year 692,440,439.57 - - - 692,440,439.57
Lease liabilities - 521,527,272.55 641,028,016.36 135,810,836.52 1,298,366,125.43
16,247,861,139.40 521,527,272.55 641,028,016.36 135,810,836.52 17,546,227,264.83
297
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Market risk
Interest rate risk
The Group's interest rate risk arises from long-term borrowings from banks. Financial liabilities
issued at floating rates expose the Group to cash flow interest rate risk. Financial liabilities
issued at fixed rates expose the Group to fair value interest rate risk. The Group determines the
relative proportions of its fixed rate and floating rate contracts depending on the prevailing market
conditions. As at 31 December 2020, if the floating interest rates of the long-term interest-bearing
borrowings increased or decreased by 50 base points, while other factors did not change, the
Group’s net income would decrease or increase by RMB97,072.60 (31 December 2019: if the
floating interest rates of the long-term interest-bearing borrowings increased or decreased by 50
base points, while other factors did not change, the Group’s net income would increase or
decrease by RMB40,471.31).
The Group’s finance department at its headquarters continuously monitors the interest rate
position of the Group. Increases in interest rates will increase the cost of new borrowings and the
interest expenses with respect to the Group’s outstanding floating rate borrowings and, therefore,
could have a material adverse effect on the Group’s financial position. The Group’s management
layer would make adjustments with reference to the latest market conditions which are interest
rate swap agreements to mitigate its exposure to interest rate risk. During 2020 and 2019, the
Group had not entered into any interest rate swap agreements.
For the year ended 31 December 2020, the Group had long-term interest-bearing borrowings with
floating interest rates amounting to RMB31,600,000.00 (31 December 2019:
RMB31,600,000.00).
Currency risk
The Group’s major operational activities are carried out in Mainland China and a majority of the
transactions are denominated in RMB. The Group is exposed to foreign exchange risk arising
from the recognised assets and liabilities as well as future transactions (denominated in foreign
currencies, primarily with respect to USD and HKD). The Group’s finance department at its
headquarters is responsible for monitoring the amounts of assets and liabilities, and transactions
denominated in foreign currencies, where the department aims at mitigating the potential foreign
exchange risk to a large extent.
298
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
VIII Risks 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 a healthy capital ratio in order to support its business, bring shareholders investing
returns and benefit related parties. Management also aims to maintain a capital structure that
ensures that the lowest cost of capital is available to the entity.
Management adjusts the capital structure through adjusting dividend payments to shareholders,
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 the end of the reporting periods are as follows:
2020 2019
Gearing ratio 57.35% 54.23%
299
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
IX Disclosure of fair value
1. Assets and liabilities at fair value
2020
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
Continuous measurement of
fair value
Receivables financing - 1,404,987,700.38 - 1,404,987,700.38
Other investment in equity
instruments - 99,488,340.28 - 99,488,340.28
Other non-current financial
assets - - 120,972,350.24 120,972,350.24
- 1,504,476,040.66 120,972,350.24 1,625,448,390.90
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
Continuous measurement of
fair value
Receivables financing - 446,342,588.46 - 446,342,588.46
Other investment in equity
instruments - 116,021,000.00 - 116,021,000.00
Other non-current financial
assets - - 140,000,000.00 140,000,000.00
- 562,363,588.46 140,000,000.00 702,363,588.46
300
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
IX Disclosure of fair value (Continued)
2. Assets and liabilities disclosed at fair value
2020
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 - 31,637,173.89 - 31,637,173.89
3. Estimation of fair value
The following are the book value and fair value of financial instruments of the Group, excluding those that have
immaterial difference in book value and fair value:
Carrying amount Fair value
31 December 2020 31 December 2019 31 December 2020 31 December 2019
Financial liabilities - - - -
Long-term borrowings 31,637,173.89 - 31,637,173.89 -
Management has assessed that the fair values of cash and cash equivalents, notes receivable, accounts
receivable, receivables financing, other receivables, short-term borrowings, notes payable, accounts payable,
other payables, non-current liabilities due within 1 year and other short-term financial assets and liabilities.
Due to the short remaining maturities of these instruments, the fair value approximated to the carrying amount.
The financial controller of the Group takes the responsibility to formulate policies and procedures related to fair
value measurements of financial instrument and directly reports to the CFO and the audit committee. On each
balance sheet date, the financial department analyses the variation of the fair value 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 amounts at which the instrument could be exchanged
or debts could be settled in an arm’s length transaction 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 31 December 2020, 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 recent equity transaction consideration or the market comparable
company model is used to estimate fair value. The Group believes that the estimated fair value by the
valuation method is rational, and also the most sufficient value at the balance sheet date.
301
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
IX Disclosure of fair value (Continued)
4. Unobservable inputs
Other non-current financial assets were the fund shares of Ningbo Meishan Bonded Port Area Qiling Equity
Investment Center LP subscribed by the Company. For the determination of the fair value of the investment,
after referring to the net assets of Ningbo Meishan Bonded Port Area Qiling Equity Investment Center LP on
31 December 2020, which has implemented the new financial instrument standards, the result was calculated
and determined according to the fund share proportion owned by the Company.
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
During the year, there were no transfers of fair value measurements between Level 1 and Level 2.
302
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
IX Disclosure of fair value (Continued)
X Related party relationships and transactions
1. Parent
Proportion of Proportion of
Share ownership voting power
Registered capital interest in the in the
address Nature of business (RMB’0,000) Company Company
Industrial investment holding, trustee of a
pharmaceutical enterprise, asset
Sinopharm reorganization, distribution and retail of
Group Shanghai medicines and pharmaceutical products, etc. 312,065.62 56.06% 56.06%
The ultimate controlling party of the Company is CNPGC.
2. Subsidiaries
Refer to Note VII (1) for details of subsidiaries.
3. Associates
Refer to Note VII (2) for details of associates.
4. Other related parties
Related party relationships
Sinopharm Foreign Trade (Beijing) Co., Ltd. Controlled by CNPGC
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. Controlled by CNPGC
Chengdu Rongsheng Pharmacy Co., Ltd. Controlled by CNPGC
Chengdu Institute of Biological Products Co., Ltd. Controlled by CNPGC
Foshan Chengnan Fengliaoxing Medical Hospital Co., Ltd. Controlled by CNPGC
Foshan Winteam Pharmaceutical Group Ltd. Controlled by CNPGC
Fujian Chentian Jinling Pharmaceutical Co., Ltd. Controlled by CNPGC
Guangdong Yifang Pharmaceutical Co., Ltd. Controlled by CNPGC
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Fortune Way Company Controlled by CNPGC
Sinopharm Beijing Huamiao Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Financial Co., Ltd. Controlled by CNPGC
Sinopharm Group Chengdu Xinlibang Biological Pharmaceutial Co., Ltd. Controlled by CNPGC
Sinopharm ChuanKang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. Controlled by CNPGC
Sinopharm Group Fengliaoxing Pharmacy (Foshan) Co., Ltd. Controlled by CNPGC
303
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Group Fengliaoxing Medical Hospital (Foshan Nanhai) Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. Controlled by CNPGC
China National Pharmaceutical Industry Co., Ltd. Controlled by CNPGC
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Guizhou Blood Products Co., Ltd. Controlled by CNPGC
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Sanyi Medicine (Wuhu) Co., Ltd. Controlled by CNPGC
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Weiqida Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Wuhan Blood Products Co., Ltd. Controlled by CNPGC
Sinopharm Wuhan Zhonglian Siyao Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Xinjiang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. Controlled by CNPGC
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. Controlled by CNPGC
China Medicine Group Chongqing Medicine Design Institute Controlled by CNPGC
Sinopharm Yixin Pharmaceutical Co., Ltd. Controlled by CNPGC
Hubei Sinopharm Zhonglian Medicine Co., Ltd. Controlled by CNPGC
Huayi Pharmaceutical Co., Ltd. Controlled by CNPGC
Lanzhou Biotechnology Development Co., Ltd. Controlled by CNPGC
Qinhai Pulante Pharmaceutical Co., Ltd. Controlled by CNPGC
Shantou Jinshi Powder Injection Co., Ltd. Controlled by CNPGC
Shanghai Zeno Biotechnology Co., Ltd. Controlled by CNPGC
Shanghai Shangsheng Biological Products Co., Ltd. Controlled by CNPGC
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. Controlled by CNPGC
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. Controlled by CNPGC
Sichuan Jiangyou Zhongba Aconiti Science and Technology Development Co.,
Ltd. Controlled by CNPGC
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. Controlled by CNPGC
China Sinopharm International Corporation Controlled by CNPGC
China National Pharmaceutical Foreign Trade Corporation Controlled by CNPGC
China National of Traditional & Herbal Medicine Co., Ltd. Controlled by CNPGC
304
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Industry Investment Co., Ltd. Controlled by CNPGC
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. Associate of CNPGC
SINO-TCM Shanghai Medicine & Medicinal Materials Co., Ltd. Associate of CNPGC
Changchun Changsheng Gene Pharmaceutical Co., Ltd. Associate of CNPGC
China Otsuka Pharmaceutical Co., Ltd. Associate of CNPGC
Beijing Sinopharm Tianyuan Real Estate & Property Management Co., Ltd. Controlled by Sinopharm Group
Guorun Medical Supply Chain Service (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm (Dalian) Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm (Nanping) Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guanai Jikun Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guangdong Medicine Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guangdong Medical Examination Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guangdong Medicine Device Supply Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guangxi Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou (Zunyi) Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guorui Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Hebei Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Hunan Prov. Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm United Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Liaoning Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Linfen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanxi Medical Devices Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanghai Medicine Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanghai Co., Ltd. Controlled by Sinopharm Group
Sinopharm Shenzhen Medicine Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Southwest Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
305
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
China National Medicines Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medical Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medicine Logistic Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medicine Logistic Co., Ltd. Guangzhou Branch Controlled by Sinopharm Group
China National Scientific Instruments & Materials I&E Shenzhen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Zhuhai Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Hubei) Hankou Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Hubei) Base Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Tianjin Binhai) Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Huaning Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Co., Ltd. Controlled by Sinopharm Group
Sinopharm Anhui Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anshun Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anshan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Bayannur Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Baotou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Beijing Huahong co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changxing Professional Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changde Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chengdu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chifeng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chuxiong Co., Ltd. Controlled by Sinopharm Group
306
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Dalian Hecheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dalian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Deyang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dezhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ordos Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Sub Marketing Center Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fujian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Medical Devices Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Gansu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Medical Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Yitong Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hainan Hongyi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hainan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Henan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Heilongjiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hengyang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Honghe Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hongrun Medical Business Service (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hulun Buir Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Bokang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Guoda Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Hongyuan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hunan Weian Pharmacy Medicine Chain Company Limited Controlled by Sinopharm Group
Sinopharm Holding Hunan Pharmaceutical Development Co., Ltd. Controlled by Sinopharm Group
307
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Hunan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jilin Chain Store Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jilin Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiangsu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiangxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiaozuo Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Kunming Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lianyungang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Liaocheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Linyi Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Lingshang Hospital Management Services (Shanghai) Co.,
Ltd. Controlled by Sinopharm Group
Sinopharm Holding Longyan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Luzhou Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lunan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanping Newforce Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nantong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Inner Mongolia Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ningde Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ningxia Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pingdingshan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Putian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pu’er Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Qianxi’nan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Qinghai Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Quanzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Rizhao Co., Ltd. Controlled by Sinopharm Group
308
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Xiamen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shandong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Hejin Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Jincheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Jinzhong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Lvliang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Runhe Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shangqiu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanghai Biomedicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shenyang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shiyan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Sichuan Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Siping Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Suzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Taizhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin North Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tonghua Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tongliao Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tongren Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wenzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ulanqab Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuxi Co., Ltd. Controlled by Sinopharm Group
309
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Wuhu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuhan Hongshen Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Xinte Shenrong 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 Special Drugs Shihezi Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinye (Hubei) Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yancheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Biological Products Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pharmacy (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Med-Tech Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yongzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yunnan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhangzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changsha Gaoxin Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changsha Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhejiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhenjiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chongqing Taimin Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chongqing Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhuanye Pharmacy (Dongfang) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zunyi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang (Langfang) Pharmaceutical Trade Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Hongkang Pharmaceutical Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Trading Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Cangzhou Pharmaceutical Trading Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Chengde Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Handan Medicine Co., Ltd. Controlled by Sinopharm Group
310
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hebei Medical Device Supply Chain Management
Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hengshui Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Langfang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Langfang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Shijiazhuang Medical Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Tangshan Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Xingtai Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Xintai Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Zhangjiakou Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Ruixinxiang (Beijing) Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument (Foshan) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Device (Guangdong) Medical Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument (Hainan) Co., Ltd. Controlled by Sinopharm Group
China National Medical Device (Hui Zhou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Baise Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument Guizhou Qiannan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Prospect Dentech (Beijing) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Pharmaceutical Logistics Co., Ltd. Controlled by Sinopharm Group
Handan Sinopharm Lerentang Pharmacy Chain Co., Ltd. Controlled by Sinopharm Group
Liaoning Pilot Free Trade Zone China Medical Device Technology Co.,
Ltd. Controlled by Sinopharm Group
Shanghai International Pharmaceutical Trade Co., Ltd. Controlled by Sinopharm Group
Shanghai Merro Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Shanghai Shengxin Pharmacy Co., Ltd. Controlled by Sinopharm Group
Shanghai Tongyu Information Technology Co., Ltd. Controlled by Sinopharm Group
Xinjiang Baitong Property Service Co., Ltd. Controlled by Sinopharm Group
Yuxi Sinopharm Medicine Co., Ltd. Controlled by Sinopharm Group
Yunnan Sinopharm Holding Dongchang Medicine Co., Ltd. Controlled by Sinopharm Group
China Medical Equipment Shandong Co., Ltd. Controlled by Sinopharm Group
China National Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Nutraceuticals (Shanghai) Co., Ltd. Associate of Sinopharm Group
Sinopharm Health Online Co., Ltd. Associate of Sinopharm Group
311
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm SteriGuard Medical Service Co., Ltd. Associate of Sinopharm Group
Sinopharm Holding (China) Financing Lease Co., Ltd. Associate of Sinopharm Group
Sinopharm Holding Chuangke Medical Technology (Guangxi) Co., Ltd. Associate of Sinopharm Group
Sinopharm Holding Chuangke Yuanzhe Medical Technology (Shanghai)
Co., Ltd. Associate of Sinopharm Group
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. Associate of Sinopharm Group
Guoyaotang Pharmacy (Shanghai) Co., Ltd. Associate of Sinopharm Group
Nanchang Sinopharm Holding Guoyaotang Pharmacy Co., Ltd. Associate of Sinopharm Group
Shanghai Guoda Lingyun Pharmacy Co., Ltd. Associate of Sinopharm Group
Yichang Humanwell Pharmaceutical Co., Ltd. Associate of Sinopharm Group
Shenzhen Wanwei Medicine Trading Co., Ltd. Subsidiary of Main Luck Pharmaceutical
Chengdu List Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Foshan Chancheng Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Foshan Chancheng District Shiwan Town Chengnan Community Health
Service Center Subsidiary of Fosun Pharm
Foshan Chancheng Central Hospital Co., Ltd. Subsidiary of Fosun Pharm
Foshan Chanyixing Medicine Development Co., Ltd. Subsidiary of Fosun Pharm
Guilin Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Hunan Dongting Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
GlaxoSmithKline Pharmaceuticals (Suzhou) Co., Ltd. Subsidiary of Fosun Pharm
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. Subsidiary of Fosun Pharm
Jiangsu Huanghe Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. Subsidiary of Fosun Pharm
Jiangxi Erye Medicine Marketing Co., Ltd. Subsidiary of Fosun Pharm
Jinzhou Avanc Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Jinzhou Avanc Medicine Co., Ltd. Subsidiary of Fosun Pharm
Chindex Shanghai International Trading Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Chaohui Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Henlius Biopharmaceuticals Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Compound Technology Medical Devices Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Transfusion Technology Co., Ltd. Subsidiary of Fosun Pharm
Shenzhen Hengsheng Hospital Subsidiary of Fosun Pharm
Shenzhen Chindex Medical Beauty Clinic Subsidiary of Fosun Pharm
Shenyang Hongqi Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Sichuan Hexin Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Suzhou Erye Pharmaceutical Limited Company Subsidiary of Fosun Pharm
Tibet Yaoyou Medicines Co., Ltd. Subsidiary of Fosun Pharm
Chongqing Haisiman Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Chongqing Yaoyou Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Chindex Shanghai International Trading Co., Ltd. Subsidiary of Fosun Pharm
312
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Beijing Huafang Investment Co., Ltd. Minority shareholders of a subsidiary
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Gu Haiqun Minority shareholders of a subsidiary
Guangdong Jiyuantang Development Co., Ltd. Minority shareholders of a subsidiary
Hangzhou Xihu District Commercial Co., Ltd. Minority shareholders of a subsidiary
Henan Wanxitang Pharmacy Co., Ltd. Minority shareholders of a subsidiary
Hunan Minshengtang Investment Co., Ltd. Minority shareholders of a subsidiary
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Lerentang Investment Group Co., Ltd. Minority shareholders of a subsidiary
Pingdingshan Pusheng Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Pu'er Songmao Medicine Group Co., Ltd. Minority shareholders of a subsidiary
Shanghai Baizhong Business Development (Group) Co., Ltd. Minority shareholders of a subsidiary
Shenzhen Jiufeng Investment Co., Ltd. Minority shareholders of a subsidiary
Shenzhen Ketai Pharmaceutical Technology Co., Ltd. Minority shareholders of a subsidiary
Shenyang Shengdiou Trading Co., Ltd. Minority shareholders of a subsidiary
Shenyang Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Taishan Qunkang Pharmacy Co., Ltd. Minority shareholders of a subsidiary
Xiong Xinyuan Minority shareholders of a subsidiary
Zhang Haiyan Minority shareholders of a subsidiary
Zhang Zhenfang Minority shareholders of a subsidiary
Linyi Pharmaceutical Group Co., Ltd. Minority shareholders of a subsidiary
Du Longfeng Minority shareholders of a subsidiary
Li Huichun Minority shareholders of a subsidiary
Jilin Province Yihe Investment Consulting Co., Ltd. Minority shareholders of a subsidiary
Companies with directors, supervisors and
senior executives serving as key
Ningbo Meishan Bonded Port Area Qiling Equity Investment Center LP management personnel
Companies owned by minority
Nanjing Yuanguang Trading Co., Ltd. shareholders of a subsidiary
Shaoguan Wujiang District Muyang Medicine Information Consultant Companies owned by minority
Co., Ltd. shareholders of a subsidiary
Companies owned by minority
Taishan Xiangranhui Trade Co., Ltd. shareholders of a subsidiary
Companies with subsidiary directors,
supervisors and senior executives serving
Jilin Ronghe Real Estate Development Co., Ltd. as key management personnel
The actual controller of minority
Gu Jinhua shareholders of a subsidiary
Family members of the actual controller of
Wang Yang minority shareholders of a subsidiary
The actual controller of minority
Li Fang shareholders of a subsidiary
Family members of key management
Zhang Yechuan personnel of a subsidiary
313
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties
(1) Related party transactions – goods and services
Purchase of goods and receiving of services from related parties
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Sub Marketing Center Co., Ltd. 116,475.39 124,021.06
China National Medicines Co., Ltd. 69,306.11 57,311.47
Sinopharm Holding Shanxi Co., Ltd. 56,979.32 41,636.50
Sinopharm Lerentang Medicine Co., Ltd. 36,319.31 16,472.43
Sinopharm Holding Shanxi Co., Ltd. 34,396.29 26,368.40
Sinopharm Holding Shenyang Co., Ltd. 24,967.28 14,095.03
Sinopharm Group 24,867.54 22,144.85
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 21,735.03 17,941.86
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 17,009.44 10,419.25
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. 13,607.70 11,023.65
Lanzhou Biotechnology Development Co., Ltd. 9,978.06 11,345.94
Sinopharm Holding Yangzhou Co., Ltd. 8,083.31 5,874.74
Sinopharm Holding Inner Mongolia Co., Ltd. 7,990.70 6,740.08
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 7,148.02 2,572.82
Sinopharm Holding Hubei Co., Ltd. 6,392.07 5,006.89
Sinopharm Holding Lunan Co., Ltd. 5,572.89 5,350.49
Chongqing Yaoyou Pharmaceutical Co., Ltd. 5,565.85 5,552.61
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. 5,518.30 655.09
Sinopharm Yixin Pharmaceutical Co., Ltd. 5,173.14 1,701.08
Sinopharm Holding Beijing Co., Ltd. 4,903.26 4,803.76
China National Pharmaceutical Foreign Trade Corporation 4,861.79 1,172.51
Sinopharm Holding Henan Co., Ltd. 4,649.57 3,209.58
Sinopharm Holding Fujian Co., Ltd. 4,357.63 3,544.64
Main Luck Pharmaceutical 3,656.32 3,598.25
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 3,576.92 2,864.87
Foshan Winteam Pharmaceutical Group Ltd. 3,266.37 3,841.10
Tibet Yaoyou Medicines Co., Ltd. 2,996.61 4,374.73
314
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Jiangsu Co., Ltd. 2,903.20 2,694.29
Sinopharm Holding Pingdingshan Co., Ltd. 2,873.45 2,799.59
Sinopharm Holding Jilin Co., Ltd. 2,766.59 1.32
Zhijun Pingshan 2,577.30 3,014.17
Zhijun Medicine 2,509.83 4,085.19
Chengdu Rongsheng Pharmacy Co., Ltd. 2,223.69 2,557.70
Sinopharm Holding Changzhou Co., Ltd. 2,179.64 1,488.55
Jinzhou Avanc Pharmaceutical Co., Ltd. 2,100.06 4,750.43
Shyndec Pharma 2,092.34 2,186.24
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. 2,058.27 1,685.38
Sinopharm Holding Shandong Co., Ltd. 2,026.98 1,419.51
Sinopharm Holding Ningxia Co., Ltd. 1,984.45 1,417.91
Yichang Humanwell Pharmaceutical Co., Ltd. 1,951.36 1,612.15
Sinopharm Holding Hunan Co., Ltd. 1,838.47 1,175.61
Shenzhen Wanwei Medicine Trading Co., Ltd. 1,716.39 2,288.99
Sinopharm Holding Xiamen Co., Ltd. 1,697.94 2,192.31
Sinopharm Holding Tongliao Co., Ltd. 1,680.74 607.65
Sinopharm Health Online Co., Ltd. 1,680.69 1,404.59
Sinopharm Group Guorui Medicine Co., Ltd. 1,576.65 600.73
Sinopharm Group Medicine Logistic Co., Ltd. 1,571.15 1,644.78
China Otsuka Pharmaceutical Co., Ltd. 1,567.48 1,483.80
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 1,422.37 1,455.99
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 1,346.72 542.01
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. 1,332.95 -
Jiangxi Erye Medicine Marketing Co., Ltd. 1,291.91 3,504.34
Sinopharm Holding Wuxi Co., Ltd. 1,062.30 684.26
Shanghai Chaohui Pharmaceutical Co., Ltd. 1,036.58 617.30
315
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Group Shanxi Medical Devices Co., Ltd. 1,034.85 (10.59)
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. 908.37 151.95
Sinopharm Holding Jinzhou Co., Ltd. 898.18 458.60
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. 856.06 -
Shanghai International Pharmaceutical Trade Co., Ltd. 802.81 104.78
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 801.63 -
Jinzhou Avanc Medicine Co., Ltd. 795.28 18.99
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. 734.88 672.74
Sinopharm Wuhan Blood Products Co., Ltd. 709.11 76.80
GlaxoSmithKline Pharmaceuticals (Suzhou) Co., Ltd. 657.03 -
Sinopharm Holding Xinjiang Xinte Shenrong Pharmaceutical Co., Ltd. 635.08 -
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 628.78 -
Sinopharm Holding Jinan Co., Ltd. 616.52 543.59
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. 596.39 1,127.60
Sinopharm Foreign Trade (Beijing) Co., Ltd. 593.03 -
Sinopharm Holding Tianjin Co., Ltd. 589.61 173.87
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. 585.58 537.94
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. 580.83 310.35
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. 570.69 360.87
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. 567.27 -
Shanghai Henlius Biopharmaceuticals Co., Ltd. 563.37 -
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. 540.12 19.48
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 533.64 341.21
Sichuan Hexin Pharmaceutical Co., Ltd. 492.08 1,074.53
Sinopharm Holding Heilongjiang Co., Ltd. 476.53 492.73
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 473.14 445.40
Sinopharm Holding Fuzhou Co., Ltd. 469.79 477.04
316
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Shenzhen Medicine Device Co., Ltd. 468.95 -
Shanghai Shangsheng Biological Products Co., Ltd. 445.47 1,190.60
Shanghai Zeno Biotechnology Co., Ltd. 442.48 -
Sinopharm Liaoning Medical Equipment Co., Ltd. 435.68 11.50
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 414.76 630.84
Sinopharm Holding Anshan Co., Ltd. 402.69 -
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 387.09 362.48
Suzhou Erye Pharmaceutical Limited Company 383.55 1,134.34
Sinopharm Holding Hubei Guoda Pharmacy Co., Ltd. 374.92 298.06
China National Scientific Instruments & Materials I&E Shenzhen Co., Ltd. 371.98 -
Yunnan Sinopharm Holding Dongchang Medicine Co., Ltd. 360.27 39.91
China National Pharmaceutical Industry Co., Ltd. 358.00 224.74
Hunan Dongting Pharmaceutical Co., Ltd. 356.83 266.01
Sinopharm ChuanKang Pharmaceutical Co., Ltd. 336.98 823.16
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 328.28 4,394.45
Sinopharm Holdings Beijing Huahong co., Ltd. 325.33 356.68
Sinopharm Holding Chongqing Co., Ltd. 310.62 -
Sinopharm Holding Hulun Buir Co., Ltd. 302.77 177.50
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 302.56 123.00
Sinopharm Holding Yancheng Co., Ltd. 298.37 280.58
Sinopharm Holding Dalian Co., Ltd. 282.55 158.66
Sinopharm Holding Quanzhou Co., Ltd. 279.53 80.05
China National Medical Device Co., Ltd. 272.34 -
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 269.68 372.99
Sinopharm Holding Anhui Huaning Medicine Co., Ltd. 251.08 293.73
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. 246.52 281.25
Sinopharm Holding Anhui Co., Ltd. 244.99 108.09
Sinopharm Medical Instrument (Hainan) Co., Ltd. 210.97 -
317
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Changsha Co., Ltd. 202.34 169.02
Shanghai Tongyu Information Technology Co., Ltd. 201.52 189.92
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 190.04 387.77
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. 185.51 71.46
Sinopharm Weiqida Pharmaceutical Co., Ltd. 164.00 266.12
Sinopharm Group Guangxi Medical Device Co., Ltd. 163.72 -
Shanghai Merro Pharmaceutical Co., Ltd. 143.83 177.85
Sinopharm Holding Wuhan Hongshen Medicine Co., Ltd. 141.59 -
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. 139.55 758.69
Chengdu Institute of Biological Products Co., Ltd. 137.27 183.22
Sinopharm United Medical Device Co., Ltd. 132.80 -
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. 132.54 103.81
Shantou Jinshi Powder Injection Co., Ltd. 128.40 566.36
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. 122.61 163.79
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. 120.37 -
Sinopharm Holding Xinjiang Special Drugs Kashgar Pharmaceutical Co., Ltd. 114.10 173.96
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. 108.17 144.75
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. 101.91 193.12
Shanghai Transfusion Technology Co., Ltd. 97.93 80.09
Sinopharm Group Southwest Medicine Co., Ltd. 96.63 249.68
Sinopharm (Dalian) Medical Device Co., Ltd. 96.20 -
Sinopharm Holding Bayannur Co., Ltd. 92.15 48.83
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. 91.42 126.38
Sinopharm Holding Putian Co., Ltd. 81.92 138.62
Sinopharm Holding Chuangke Medical Technology (Guangxi) Co., Ltd. 79.65 -
Sinopharm Holding Special Drugs Shihezi Pharmaceutical Co., Ltd. 79.39 -
Huayi Pharmaceutical Co., Ltd. 78.20 (12.24)
Guilin Pharmaceutical Co., Ltd. 77.62 82.38
Sinopharm Holding Pu’er Co., Ltd. 71.28 3.98
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. 69.17 -
Sinopharm Holding Chuangke Yuanzhe Medical Technology (Shanghai) Co.,
Ltd. 67.26 -
318
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. 65.08 -
Sinopharm Group Linfen Co., Ltd. 63.46 1.28
Sinopharm Holding Linyi Medical Device Co., Ltd. 63.38 -
Sinopharm Hebei Medical Instrument Co., Ltd. 60.74 -
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. 60.50 167.27
Shenyang Hongqi Pharmaceutical Co., Ltd. 58.10 224.12
Sinopharm Xinjiang Pharmaceutical Co., Ltd. 58.04 50.64
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 57.35 89.63
Pu'er Songmao Medicine Group Co., Ltd. 53.81 -
Sinopharm Holding Shanxi Jinzhong Co., Ltd. 47.94 -
Sinopharm Holding Zhejiang Co., Ltd. 44.11 30.09
Sinopharm Holding Yunnan Co., Ltd. 39.87 -
Sinopharm Holding Chifeng Co., Ltd. 39.74 -
Sinopharm Group Shanghai Medicine Device Co., Ltd. 32.72 -
Sinopharm Holding Rizhao Co., Ltd. 30.08 2.20
Sinopharm Wuhan Zhonglian Siyao Pharmaceutical Co., Ltd. 28.30 3.54
Sinopharm Holding Nanping Newforce Co., Ltd. 27.21 -
Liaoning Pilot Free Trade Zone China Medical Device Technology Co., Ltd. 26.02 -
Sinopharm Holding Changde Co., Ltd. 25.05 18.04
Sinopharm Holding Hunan Pharmaceutical Development Co., Ltd. 23.20 24.49
Chengdu List Pharmaceutical Co., Ltd. 20.48 (174.98)
Sinopharm Holding Yangzhou Biological Products Co., Ltd. 19.11 40.26
Fujian Chentian Jinling Pharmaceutical Co., Ltd. 18.01 87.34
Sinopharm Holding Longyan Co., Ltd. 17.32 -
Sinopharm Holding Baotou Co., Ltd. 16.08 -
319
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Sichuan Pharmaceutical Co., Ltd. 14.46 -
Sinopharm Device (Guangdong) Medical Technology Co., Ltd. 13.33 -
Sinopharm Holding Hainan Co., Ltd. 11.86 55.64
Sinopharm Holding Dezhou Co., Ltd. 10.87 25.26
Sinopharm Pharmaceutical Logistics Co., Ltd. 9.36 16.63
Sinopharm Holding Shanxi Runhe Medicine Co., Ltd. 9.32 3.65
Sinopharm Group Med-Tech Co., Ltd. 9.29 -
Sinopharm Group Shanxi Co., Ltd. 8.58 11.19
Sinopharm Holding Xinye (Hubei) Medicine Co., Ltd. 8.48 -
Sinopharm Holding Zhangzhou Co., Ltd. 7.97 (0.41)
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. 7.16 14.19
Sinopharm Holding Dalian Hecheng Co., Ltd. 6.65 30.60
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. 6.60 7.50
Sinopharm Holding Changsha Gaoxin Medicine Co., Ltd. 5.63 -
Sinopharm Holding Taizhou Co., Ltd. 5.56 8.89
Sinopharm Group Lingshang Hospital Management Services (Shanghai) Co.,
Ltd. 5.30 159.95
Sinopharm Sanyi Medicine (Wuhu) Co., Ltd. 5.17 6.17
Guorun Medical Supply Chain Service (Shanghai) Co., Ltd. 4.91 0.16
Sinopharm Holding Jiangxi Co., Ltd. 2.82 3.80
Sinopharm Holding Hengyang Co., Ltd. 2.53 -
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 2.26 1.70
Sinopharm Holding Hainan Hongyi Co., Ltd. 1.70 -
Sinopharm Medical Instrument (Foshan) Co., Ltd. 1.63 -
China Medical Equipment Shandong Co., Ltd. 1.44 34.06
320
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Chongqing Haisiman Pharmaceutical Co., Ltd. 1.28 -
Sinopharm Holding Chengdu Co., Ltd. 1.13 -
Sinopharm Lerentang Tangshan Medicine Co., Ltd. 0.48 -
Sinopharm Holding Shiyan Co., Ltd. 0.21 -
Sinopharm Holding Ulanqab Co., Ltd. 0.20 2.91
China National Medical Device (Hui Zhou) Co., Ltd. 0.08 -
Sinopharm Holding Shanxi Jincheng Co., Ltd. 0.02 1.32
Sinopharm Holding Shanxi Lvliang Co., Ltd. - 436.90
Shanghai Beiyi - 227.23
Sinopharm Group Medical Management Co., Ltd. - 167.58
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical Co., Ltd. - 145.69
Sinopharm Group Guizhou Blood Products Co., Ltd. - 104.57
Sinopharm Holding Suzhou Co., Ltd. - 82.16
Qinhai Pulante Pharmaceutical Co., Ltd. - 25.86
Jiangsu Huanghe Pharmaceutical Co., Ltd. - 19.94
Sinopharm Holding (Hubei) Base Pharmaceutical Co., Ltd. - 15.20
SINO-TCM Shanghai Medicine & Medicinal Materials Co., Ltd. - 8.57
Sinopharm Holding Fuzhou Medical Devices Co., Ltd. - 4.07
Sichuan Jiangyou Zhongba Aconiti Science and Technology Development Co.,
Ltd. - 2.91
Sinopharm Lerentang Xintai Medicine Co., Ltd. - 2.64
Sinopharm Lerentang Hebei Medical Device Supply Chain Management Co.,
Ltd. - 1.60
Sinopharm Holding Luzhou Pharmaceutical Co., Ltd. - 1.01
Sinopharm Holding Tonghua Co., Ltd. - 0.37
Sinopharm Beijing Huamiao Pharmaceutical Co., Ltd. - 0.10
Sinopharm Holding Yongzhou Co., Ltd. - (0.01)
321
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Purchase of goods and receiving of services from related parties (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Prospect Dentech (Beijing) Co., Ltd. - (0.19)
Sinopharm Group Chengdu Xinlibang Biological Pharmaceutial Co., Ltd. - (0.95)
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. (0.06) -
Sinopharm Holding Lianyungang Co., Ltd. (1.46) 143.93
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. (19.18) 326.60
592,449.98 487,475.44
322
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Sale of goods and rendering of services
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Group 24,734.75 23,301.91
Sinopharm Holding Hainan Co., Ltd. 12,961.48 10,176.88
Shanghai Beiyi 12,490.44 11,534.81
Foshan Chancheng Pharmaceutical Co., Ltd. 10,915.86 11,126.10
Sinopharm Holding Fujian Co., Ltd. 5,874.55 376.37
Sinopharm Lerentang Medicine Co., Ltd. 4,950.04 1,772.13
Sinopharm Holding Hainan Hongyi Co., Ltd. 3,268.53 3,239.54
Sinopharm Holding Beijing Co., Ltd. 3,168.71 2,202.63
Sinopharm Holding Wenzhou Co., Ltd. 3,055.11 2,806.78
Sinopharm Holding Hubei Co., Ltd. 2,444.36 1,141.98
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 2,424.69 2,582.26
Shenzhen Hengsheng Hospital 2,413.30 2,231.25
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 2,084.80 2,279.09
Sinopharm Holding Henan Co., Ltd. 1,974.34 1,868.25
Sinopharm Lerentang Xingtai Pharmaceutical Co., Ltd. 1,792.10 -
Foshan Chancheng Central Hospital Co., Ltd. 1,716.46 1,191.82
Sinopharm Holding Nantong Co., Ltd. 1,551.25 1,555.67
Sinopharm Holding Shandong Co., Ltd. 1,462.22 1,431.16
Sinopharm Holding Sub Marketing Center Co., Ltd. 1,281.24 1,912.48
Sinopharm Holdings Beijing Huahong co., Ltd. 1,234.14 2,824.47
China National Medicines Co., Ltd. 1,181.02 1,203.24
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical Co., Ltd. 1,081.34 1,459.24
Sinopharm Sichuan Pharmaceutical Co., Ltd. 959.21 1,257.31
Foshan Chanyixing Medicine Development Co Ltd. 893.27 679.73
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. 764.13 752.36
Sinopharm Holding Shanxi Co., Ltd. 752.39 556.62
Sinopharm Zhuhai Medical Instrument Co., Ltd. 744.62 1.39
Sinopharm Holding Yangzhou Co., Ltd. 711.82 871.14
Shanghai Merro Pharmaceutical Co., Ltd. 652.08 701.12
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 608.95 265.68
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 593.43 744.15
Sinopharm Group Medicine Logistic Co., Ltd. 548.23 63.81
Sinopharm Shenzhen Medicine Device Co., Ltd. 538.94 -
323
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Sale of goods and rendering of services (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Shanxi Co., Ltd. 522.51 840.82
Sinopharm Lerentang Baoding Hongkang Pharmaceutical
Chain Co., Ltd. 508.53 10.99
Sinopharm Holding Jinzhou Co., Ltd. 443.29 507.86
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai)
Co., Ltd. 424.06 290.65
Sinopharm Holding Anhui Co., Ltd. 412.03 616.25
Sinopharm Holding Xinjiang Special Drugs Western
Pharmaceutical Co., Ltd. 402.75 472.19
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. 397.70 -
Sinopharm Holding Hunan Co., Ltd. 391.44 293.58
Sinopharm Holding Tianjin Co., Ltd. 345.76 436.58
Shanghai Shengxin Pharmacy Co., Ltd. 341.33 45.10
Handan Sinopharm Lerentang Pharmacy Chain Co., Ltd. 319.70 -
Sinopharm Lerentang Tangshan Medicine Co., Ltd. 318.05 -
Sinopharm Group Southwest Medicine Co., Ltd. 312.32 290.33
Sinopharm Holding Yunnan Co., Ltd. 303.64 569.20
China Sinopharm International Corporation 300.14 -
Sinopharm Holding Xuzhou Co., Ltd. 281.24 559.72
Zhijun Medicine 273.28 263.83
Shanghai Liyi 270.43 321.81
Sinopharm Holding Jilin Co., Ltd. 267.75 388.85
Sinopharm Holding Zunyi Co., Ltd. 266.50 17.76
Shanghai Guoda Lingyun Pharmacy Co., Ltd. 255.97 53.62
Sinopharm Holding Dalian Co., Ltd. 242.76 264.99
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. 238.28 284.08
Chindex Shanghai International Trading Co., Ltd. 234.37 -
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 212.30 -
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading
Co., Ltd. 210.24 -
Sinopharm Lerentang (Langfang) Pharmaceutical Trade Co.,
Ltd. 185.55 -
Sinopharm Lerentang Hengshui Medicine Co., Ltd. 180.87 -
Sinopharm Lerentang Baoding Trading Co., Ltd. 174.02 -
324
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Sale of goods and rendering of services (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Guizhou Co., Ltd. 155.16 47.90
Sinopharm Holding Guizhou Medical Device Co., Ltd. 154.82 21.31
Sinopharm Holding Jiangsu Co., Ltd. 148.99 36.65
Sinopharm Holding Gansu Co., Ltd. 147.13 119.62
Sinopharm Holding Jiangxi Co., Ltd. 135.52 97.36
Sinopharm Holding Guizhou (Zunyi) Medical Equipment Co., Ltd. 124.54 -
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 119.50 -
Sinopharm Holding Shangqiu Co., Ltd. 112.63 -
Sinopharm Holding Anshun Co., Ltd. 110.17 8.77
Sinopharm Holding Wuxi Co., Ltd. 108.70 79.86
Sinopharm Holding Ningxia Co., Ltd. 108.03 132.74
Sinopharm Holding Wuhu Co., Ltd. 101.92 113.26
Sinopharm Lerentang Cangzhou Pharmaceutical Trading Co., Ltd. 100.27 -
Sinopharm Holding Inner Mongolia Co., Ltd. 96.62 64.87
Sinopharm Holding Quanzhou Co., Ltd. 95.96 2.06
Sinopharm Holding Chongqing Co., Ltd. 90.10 26.53
Sinopharm Holding Honghe Co., Ltd. 84.17 85.55
Sinopharm Holding Yancheng Co., Ltd. 81.78 125.78
Sinopharm Holding Anshan Co., Ltd. 71.89 -
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 61.57 50.51
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. 60.69 -
Sinopharm Holding Tongren Co., Ltd. 59.06 61.49
Sinopharm Group Shanxi Co., Ltd. 57.25 81.90
Foshan Chancheng District Shiwan Town Chengnan Community Health
Service Center 54.56 -
Dongyuan accord 53.99 6.62
Zhijun Pingshan 52.94 18.55
Sinopharm Holding Chongqing Taimin Pharmaceutical Co., Ltd. 50.63 23.35
Sinopharm Holding Tianjin North Medicine Co., Ltd. 48.29 63.64
Zhijun Trade 46.43 57.14
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. 45.26 -
325
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Sale of goods and rendering of services (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Qinghai Co., Ltd. 44.40 57.04
Sinopharm Lerentang Xintai Medicine Co., Ltd. 41.19 -
Sinopharm Guangdong Medical Examination Co., Ltd. 37.63 15.59
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 36.20 0.87
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. 35.59 -
Shenzhen Chindex Medical Beauty Clinic 33.97 61.44
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 32.41 -
Sinopharm Holding Chuxiong Co., Ltd. 32.29 8.51
Sinopharm Group Guangxi Medical Device Co., Ltd. 31.08 15.54
Sinopharm Baise Device Co., Ltd. 29.59 -
Sinopharm Holding Hubei Hongyuan Co., Ltd. 27.28 24.17
Sinopharm Holding Chengdu Co., Ltd. 26.95 69.53
Sinopharm Holding Jiaozuo Co., Ltd. 25.50 70.26
Sinopharm Lerentang Baoding Medicine Co., Ltd. 25.28 -
Sinopharm Lerentang Chengde Medicine Co., Ltd. 24.83 -
Sinopharm Holding Fuzhou Co., Ltd. 24.02 30.12
Sinopharm Lerentang Shijiazhuang Medical Management Co., Ltd. 22.79 0.27
Sinopharm Holding Xinye (Hubei) Medicine Co., Ltd. 22.78 -
Yuxi Sinopharm Medicine Co., Ltd. 22.61 153.82
Sinopharm Lerentang Langfang Pharmaceutical Co., Ltd. 21.33 -
Sinopharm Guangdong Medicine Device Supply Chain Co., Ltd. 19.64 13.91
Sinopharm Holding Changzhou Co., Ltd. 18.75 28.41
Foshan Chengnan Fengliaoxing Medical Hospital Co., Ltd. 18.21 17.34
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. 16.99 8.55
China National Pharmaceutical Foreign Trade Corporation 16.44 10.27
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. 15.37 17.57
Sinopharm Holding Pharmacy (Shanghai) Co., Ltd. 15.18 0.09
Sinopharm Lerentang Zhangjiakou Medicine Co., Ltd. 14.27 -
Sinopharm Hunan Prov. Medical Equipment Co., Ltd. 14.23 -
Sinopharm Holding Dalian Hecheng Co., Ltd. 12.41 182.43
326
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Sale of goods and rendering of services (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Putian Co., Ltd. 10.60 1.97
Sinopharm Holding Longyan Co., Ltd. 9.75 10.11
Sinopharm Holding Taizhou Co., Ltd. 9.16 25.38
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. 8.69 -
Sinopharm Holding Qianxi’nan Co., Ltd. 7.09 2.02
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy Co., Ltd. 6.83 4.85
Sinopharm Holding Pingdingshan Co., Ltd. 6.05 -
Sinopharm Holding Ningde Co., Ltd. 5.94 (2.04)
Sinopharm Group Guangdong Medicine Device Co., Ltd. 5.88 52.21
China National Scientific Instruments & Materials I&E Shenzhen Co.,
Ltd. 4.92 1.05
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 4.91 -
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. 4.89 -
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. 4.60 7.68
Sinopharm Holding Fuzhou Medical Devices Co., Ltd. 4.07 -
Sinopharm Holding Shenyang Co., Ltd. 3.82 302.88
Sinopharm Holding Fuzhou Co., Ltd. 3.69 0.46
Sinopharm Lerentang Handan Medicine Co., Ltd. 3.50 -
Guangdong Yifang Pharmaceutical Co., Ltd. 2.71 -
Sinopharm Holding Kunming Pharmacy Co., Ltd. 2.67 -
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. 2.53 -
Sinopharm Guanai Jikun Pharmacy (Haikou) Co., Ltd. 2.45 0.09
Sinopharm Fortune Way Company 2.38 -
Sinopharm Holding Changxing Professional Pharmacy (Haikou) Co.,
Ltd. 2.25 0.51
Sinopharm Holding Zhuanye Pharmacy (Dongfang) Co., Ltd. 1.87 -
Sinopharm Holding Hongrun Medical Business Service (Shanghai) Co.,
Ltd. 1.81 28.72
Sinopharm Medical Instrument Guizhou Qiannan Co., Ltd. 1.63 15.47
China Otsuka Pharmaceutical Co., Ltd. 1.61 2.07
Sinopharm Lerentang Langfang Medicine Co., Ltd. 0.73 -
Main Luck Pharmaceutical 0.66 -
Sinopharm Holding Xiamen Co., Ltd. 0.59 -
Sinopharm Holding Zhenjiang Co., Ltd. 0.56 0.84
327
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(1) Related party transactions – goods and services (Continued)
Sale of goods and rendering of services (Continued)
2020 2019
(RMB’0,000) (RMB’0,000)
Sinopharm Group Fengliaoxing Medical Hospital (Foshan Nanhai)
Co., Ltd. 0.51 1.01
Guangdong Jienuo 0.27 0.36
Sinopharm Medical Instrument (Hainan) Co., Ltd. 0.18 -
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co.,
Ltd. 0.17 -
Sinopharm Holding Guizhou Medical Chain Co., Ltd. 0.13 -
Sinopharm Holding Shanxi Hejin Pharmaceutical Co., Ltd. 0.12 -
Shenzhen Ketai Pharmaceutical Technology Co., Ltd. - 511.68
Sinopharm Holding Lianyungang Co., Ltd. - 115.23
Sinopharm Ruixinxiang (Beijing) Medical Device Co., Ltd. - 28.78
Nanchang Sinopharm Holding Guoyaotang Pharmacy Co., Ltd. - 25.50
Sinopharm Holding (Hubei) Hankou Pharmacy Co., Ltd. - 19.53
Sinopharm Holding Hunan Weian Pharmacy Medicine Chain
Company Limited - 18.50
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. - 8.67
Shanghai Compound Technology Medical Devices Co., Ltd. - 7.98
Sinopharm Medical Instrument (Foshan) Co., Ltd. - 7.94
Sinopharm Holding Liaocheng Co., Ltd. - 3.72
Sinopharm Holding Deyang Co., Ltd. - 3.68
Sinopharm SteriGuard Medical Service Co., Ltd. - 3.50
Sinopharm (Nanping) Medical Instrument Co., Ltd. - 2.00
Sinopharm Holding Shanxi Jincheng Co., Ltd. - 1.51
Sinopharm Holding Siping Co., Ltd. - 1.00
Sinopharm Holding Huaian Co., Ltd. - 0.71
Guoyaotang Pharmacy (Shanghai) Co., Ltd. - 0.37
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. - 0.28
Sinopharm Holding Changsha Co., Ltd. - (2.20)
Sinopharm Holding Ulanqab Co., Ltd. (0.06) 14.51
Sinopharm Holding Jilin Chain Store Co., Ltd. (1.66) 14.03
Sinopharm Group Fengliaoxing Pharmacy (Foshan) Co., Ltd. (2.65) 16.26
124,488.24 104,009.59
328
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(2) Related party asset trusteeship
2020
Type of an Pricing basis for Trusteeship income
asset under trusteeship income recognised
trusteeship (RMB‘0,000)
Other asset
Ningbo Meishan Bonded Port Area Qiling Equity under Trusteeship
Investment Center LP trusteeship agreement 96.15
(3) Related party transactions - leases
As the lessor
Type of Income from leases in Income from leases in
assets under 2020 (RMB‘0,000) 2019 (RMB‘0,000)
leases
Zhijun Medicine Building 191.43 191.43
Zhijun Trade Building 46.43 57.14
Sinopharm Holding Hunan Weian Pharmacy Medicine
Chain Company Limited. Building 19.69 18.50
Beijing Golden Elephant Fosun Pharmaceutical Co.,
Ltd. Building 13.33 -
China National Medicines Co., Ltd. Building 6.07 4.80
276.95 271.87
As the lessee
Type of Expenses from leases Expenses from leases
assets under in 2020 (RMB‘0,000) in 2019 (RMB‘0,000)
leases
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. Building 1,059.25 1,011.23
Sinopharm Group Medicine Logistic Co., Ltd. Equipment 750.00 750.00
Shenyang Pharmaceutical Co., Ltd. Building 714.29 47.62
Sinopharm Group Medicine Logistic Co., Ltd. Building 708.00 708.00
Sinopharm Group Shanghai Co., Ltd. Building 700.54 719.72
Sinopharm Group Xinjiang Special Drugs National
Pharmaceutical Co., Ltd. Building 691.31 723.73
Lerentang Investment Group Co., Ltd. Building 638.89 644.81
Pingdingshan Pusheng Pharmaceutical Co., Ltd. Building 464.17 479.06
Sinopharm Holding (China) Financing Lease Co., Ltd. Equipment 397.21 -
Sinopharm Holding Yangzhou Co., Ltd. Building 391.20 372.57
Hunan Minshengtang Investment Co., Ltd. Building 245.73 53.12
Pu'er Songmao Medicine Group Co., Ltd. Building 202.21 198.48
Nanjing Yuanguang Trading Co., Ltd. Building 200.43 149.91
329
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(3) Related party transactions – leases (continued)
As the lessee (continued)
Type of assets Expenses from Expenses from leases
under leases leases in 2020 in 2019 (RMB‘0,000)
(RMB‘0,000)
Guangdong Jiyuantang Development Co., Ltd. Building 190.97 189.75
Shaoguan Wujiang District Muyang Medicine
Information Consultant Co., Ltd. Building 98.28 97.47
Taishan Xiangranhui Trade Co., Ltd. Building 82.15 81.76
Zhang Zhenfang Building 80.50 80.50
Zhang Yechuan Building 73.87 -
Wang Yang Building 59.42 52.57
Li Fang Building 54.48 -
Sinopharm Holding Beijing Co., Ltd. Building 48.79 49.52
Sinopharm Holding Xinjiang Xinte Karamay
Pharmaceutical Co., Ltd. Building 47.41 46.13
Sinopharm Holding Xinjiang Special Drugs Kashgar
Pharmaceutical Co., Ltd. Building 41.01 48.54
Sinopharm Xinjiang Pharmaceutical Co., Ltd. Building 36.74 38.86
Gu Jinhua Building 36.06 35.76
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. Building 25.74 -
Beijing Huafang Investment Co., Ltd. Building 24.19 -
Shenzhen Jiufeng Investment Co., Ltd. Building 20.00 20.00
Gu Haiqun Building 18.48 19.04
Sinopharm Group Medicine Logistic Co., Ltd.
Guangzhou Branch Equipment 17.71 -
Zhang Haiyan Building 17.14 -
Taishan Qunkang Pharmacy Co., Ltd. Equipment 13.50 13.74
China National Medicines Co., Ltd. Building 11.58 28.57
Zhijun Pingshan Building 10.18 4.24
Beijing Sinopharm Tianyuan Real Estate & Property
Management Co., Ltd. Building 6.94 31.54
Sinopharm Holding (China) Financing Lease Co.,
Ltd. Building - 638.56
Linyi Pharmaceutical Group Co., Ltd. Building - 184.81
Hangzhou Xihu District Commercial Co., Ltd. Building - 27.89
Sinopharm Holding Rizhao Co., Ltd. Building - 20.00
Sinopharm Holding Fujian Co., Ltd. Building - 1.30
8,178.37 7,568.80
330
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(4) Related party transactions - guarantees
The Group had no related party guarantees not yet fulfilled this year and in 2019.
(5) Related party transactions – borrowings and lendings
Borrowings
2020 Category Amount Inception Maturity
(RMB‘0,000)
Sinopharm Group Financial 21 February 2020- 1 July 2020-
Co., Ltd. Short-term borrowings 75,052.21 18 September 2020 30 January 2021
Sinopharm Group Financial Discount on bank 30 March 2020- 25 May 2020-
Co., Ltd. acceptance bills 60,820.88 25 September 2020 24 June 2021
Jilin Ronghe Real Estate 4 January 2020- 21 January 2020-
Development Co., Ltd. Short-term borrowings 10,400.00 20 February 2020 1 May 2020
Jilin Province Yihe Investment 16 May 2020- 23 January 2021-
Consulting Co., Ltd. Short-term borrowings 5,670.00 23 November 2020 22 June 2021
1 January 2020- 31 March 2020-
Sinopharm Group Short-term borrowings 5,600.00 1 February 2020 30 April 2020
CNPGC Long-term borrowings 3,160.00 30 July 2020 30 July 2023
160,703.09
2019 Category Amount Inception Maturity
(RMB‘0,000)
Sinopharm Group Finance Discount on commercial 24 January 2019- 28 February 2019-
Co., Ltd. acceptance bills 38,966.99 23 July 2019 30 November 2019
Sinopharm Group Finance 17 April 2019- 17 July 2019-
Co., Ltd. Short-term borrowings 11,750.24 24 December 2019 24 June 2020
1 February 2019- 22 May 2019-
Sinopharm Group Short-term borrowings 8,800.00 4 June 2019 22 May 2020
Sinopharm Group Finance Discount on bank 14 August 2019- 24 December 2019-
Co., Ltd. acceptance bills 4,394.67 21 November 2019 30 March 2020
CNPGC Long-term borrowings 3,160.00 24 May 2017 24 May 2020
67,071.90
331
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(6) Related party asset transfer
Types of transaction 2020 2019
(RMB‘0,000) (RMB‘0,000)
Shanghai Tongyu Information
Technology Co., Ltd. Purchase of an intangible asset 165.48 67.33
Shanghai Tongyu Information
Technology Co., Ltd. Purchase of a fixed asset 27.98 -
Sinopharm Group Purchase of an intangible asset - 233.64
Sinopharm Holding (Tianjin Binhai)
Pharmaceutical Co., Ltd. Purchase of a fixed asset - 43.94
Sinopharm Holding Tianjing Co., Ltd. Purchase of a fixed asset - 4.11
193.46 349.02
(7) Other related party transactions
Remuneration for key management personnel
2020 2019
(RMB‘0,000) (RMB‘0,000)
1,656.25 1,733.89
Interest expense
Category 2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group Financial Co., Ltd. Payment of loan interest 788.29 144.38
Payment of discount interest on
Sinopharm Group Financial Co., Ltd. notes 632.17 359.52
Jilin Ronghe Real Estate
Development Co., Ltd. Payment of entrusted loan interest 335.84 -
CNPGC Payment of entrusted loan interest 103.77 129.36
Payment of interest on loans to
Sinopharm Group related parties 103.60 178.86
Jilin Province Yihe Investment
Consulting Co., Ltd. Payment of entrusted loan interest 49.92 -
2,013.59 812.12
332
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(7) Other related party transactions (Continued)
Interest income
Category 2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group Finance Co., Ltd. Deposit interest income 9.11 17.92
Zhijun Suzhou Entrusted loan interest income - 341.43
9.11 359.35
Accounts receivable factoring without recourse
2020 2019
(RMB‘0,000) (RMB‘0,000)
Accounts Accounts
receivable Terminated receivable Terminated
factoring recognition loss factoring recognition loss
Sinopharm Holding (China)
Finance Leasing Co., Ltd. - - 5,407.82 128.67
Sinopharm Group Finance Co.,
Ltd. - - 3,888.97 53.12
- - 9,296.79 181.79
(8) Other investment matters
On 2 January 2020, Guoda Drugstore, a subsidiary of the Company, acquired 75% of the shares of
Pudong Medicine from Sinopharm Group for RMB163,115,000, forming a business combination
under the common control. The above transaction constituted the Company's related transactions.
On 7 January 2020, Guoda Drugstore, a subsidiary of the Company, acquired 100% equity of
Shanghai Dingqun from its related parties, Ningbo Meishan Bonded Port Area Qiling Equity
Investment Center LP and the Company for RMB934,240,000, forming a business combination not
under the common control. The above transaction constituted the Company's related transactions.
333
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
Notes (Expressed in RMB‘0,000):
(1) Related party transactions - sale of goods and rendering of services
(a) During the current year, the Group purchased goods from related parties at the market price amounting to
RMB588,714.37 (2019: RMB485,356.17).
(b) During the current year, the related parties rendered services to the Group at the market price amounting to
RMB3,735.61 (2019: RMB2,119.27).
(c) During the current year, the Group sold goods to related parties at the market price amounting to
RMB122,451.32 (2019: RMB102,777.11).
(d) During the current year, the Group rendered services to related parties at the market price amounting to
RMB2,036.92 (2019: RMB1,232.48).
(2) Asset trusteeship
During the current year, Ningbo Meishan Bonded Port Area Qiling Equity Investment Center LP entrusted part
of its right of daily operation for the Group in the target Company, Jilin Tianhe Pharmaceutical Technology Co.,
Ltd. The Group confirmed the trusteeship income of RMB96.15 according to the trusteeship agreement (2019:
nil).
(3) Related party transactions - leases
(a) During the current year, the Group leased buildings and equipment to related parties and recognised income
of RMB276.95 (2019: RMB271.87) according to the agreements.
(b) During the current year, the Group leased buildings and equipment from related parties and an expense of
RMB8,178.37 (2019: RMB7,568.80) was incurred according to the lease.
(4) Related party transactions - guarantees
(a) The Group had no related party guarantees that are not yet completed in the current year as well as in 2019.
(5) Related party transactions - borrowings
(a) During the current year, the Group borrowed RMB160,703.09 at annual interest rates ranging from 2.40% to
4.79% from related parties (2019: RMB67,071.90 at rates ranging from 3.00% to 4.57%).
(b) During the current year, the Group has not lent capital to related parties (2019: nil).
(6) Related party transactions - asset transfer
(a) During the current year, the Group purchased long-term assets from related parties at a negotiated price
amounting to RMB193.46 (2019: RMB349.02).
(b) During the current year, the Group has not sold any long-term assets to related parties (2019: nil).
(7) Other major related party transactions
(a) During the current year, the Group incurred emoluments (including those paid in cash, in kind and in other
forms) for key management personnel with an amount of RMB1,656.25 (2019: RMB1,733.89).
(b) During the current year, the Group has paid borrowing interest, entrusted loan interest, etc. to related parties in
the amount of RMB2,013.59 (2019: RMB812.12)
(c) During the current year, the Group has received deposit interest from related parties in the amount of RMB9.11
(2019: RMB359.35).
(d) During the current year, the Group factored a portion of accounts receivable at amortised cost to related
parties. The amount of accounts receivable derecognised was nil (2019: RMB9,296.79), and the amount of the
loss recognised through Investment income was nil (2019: RMB181.79).
(8) Other investment matters
(a) In the current year, Guoda Drugstore, a subsidiary of the company, acquired 75% of Pudong Medicine from
Sinopharm Group for RMB16,311.50.
(b) In the current year, Guoda Drugstore, a subsidiary of the Company, acquired 100% equity of Shanghai
Dingqun from its related parties, Ningbo Meishan Bonded Port Area Qiling Equity Investment Center LP and
the Company for RMB93,424.00.
334
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
6. Commitments between the Group and related parties
As lessee
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Yangzhou Co., Ltd. 1,956.00 -
Lerentang Investment Group Co., Ltd. 1,017.87 -
Shaoguan Wujiang District Muyang Medicine Information Consultant Co.,
Ltd. 771.72 -
Zhang Yechuan 577.72
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. 397.49 -
Guangdong Jiyuantang Development Co., Ltd. 318.01 -
Shenyang Pharmaceutical Co., Ltd. 297.62 -
Li Fang 217.92 -
Beijing Sinopharm Tianyuan Real Estate & Property Management Co., Ltd. 162.86 -
Hunan Minshengtang Investment Co., Ltd. 109.76 -
Sinopharm Holding (China) Financing Lease Co., Ltd. 87.06 -
Taishan Xiangranhui Trade Co., Ltd. 84.39 -
Zhang Zhenfang 80.50 -
Sinopharm Xinjiang Pharmaceutical Co., Ltd. 77.71 -
Nanjing Yuanguang Trading Co., Ltd. 57.15 -
Zhang Haiyan 53.72 -
Gu Haiqun 44.69 -
Gu Jinhua 37.86 -
Zhijun Pingshan 36.49 -
Beijing Huafang Investment Co., Ltd. 34.59 31.10
Shenzhen Jiufeng Investment Co., Ltd. 16.67 -
Sinopharm Holding Beijing Co., Ltd. 12.38 -
Pu'er Songmao Medicine Group Co., Ltd. 3.73 -
Taishan Qunkang Pharmacy Co., Ltd. 1.13 -
Sinopharm Group Shanghai Co., Ltd. - 753.01
6,455.04 784.11
335
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
6. Commitments between the Group and related parties (Continued)
As lessor
2020 2019
(RMB‘0,000) (RMB‘0,000)
Beijing Golden Elephant Fosun Pharmaceutical Co.,
Ltd. 26.67 -
Sinopharm Holding Hunan Weian Pharmacy
Medicine Chain Company Limited 18.72 36.43
Zhijun Medicine - 111.67
Zhijun Trade - 28.57
China National Medicines Co., Ltd. - 5.04
45.39 181.71
336
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties
Accounts receivable
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Group 5,104.47 - 4,607.65 -
Foshan Chancheng Pharmaceutical Co., Ltd. 5,045.71 33.12 4,259.62 25.95
Shanghai Beiyi 2,606.65 - 2,719.44 -
Sinopharm Lerentang Medicine Co., Ltd. 1,133.99 - 407.77 -
Sinopharm Holding Beijing Co., Ltd. 932.92 - 295.06 -
Sinopharm Holding Hainan Co., Ltd. 926.32 - 591.60 0.01
Foshan Chancheng Central Hospital Co., Ltd. 619.99 3.90 369.18 2.32
Sinopharm Health Online Co., Ltd. 596.16 - 389.02 -
Shenzhen Hengsheng Hospital 537.70 - 333.52 -
Sinopharm Holding Hainan Hongyi Co., Ltd. 534.71 - 346.42 -
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 439.73 - 806.41 -
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 438.06 - 394.97 -
Sinopharm Lerentang Baoding Hongkang Pharmaceutical
Chain Co., Ltd. 346.42 - - -
Foshan Chanyixing Medicine Development Co., Ltd. 344.57 1.80 198.36 0.58
Sinopharm Holding Wenzhou Co., Ltd. 314.26 - 69.96 -
Sinopharm Holding Sub Marketing Center Co., Ltd. 223.71 - 184.95 -
Sinopharm Holding Henan Co., Ltd. 214.42 - 119.01 -
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 205.00 - 208.53 -
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai)
Co., Ltd. 181.45 - - -
Sinopharm Holdings Beijing Huahong co., Ltd. 181.11 - 287.61 -
Shanghai Merro Pharmaceutical Co., Ltd. 164.80 - 97.06 -
Sinopharm Lerentang Baoding Trading Co., Ltd. 164.53 - - -
Sinopharm Sichuan Pharmaceutical Co., Ltd. 143.77 - 155.84 -
Sinopharm Holding Xinjiang Special Drugs Western
Pharmaceutical Co., Ltd. 138.51 - 88.77 -
Sinopharm Holding Shanghai Likang Pharmaceutical Co.,
Ltd. 133.71 - 92.93 -
Sinopharm Lerentang (Langfang) Pharmaceutical Trade Co.,
Ltd. 129.43 - - -
Sinopharm Group Xinjiang Special Drugs National
Pharmaceutical Co., Ltd. 125.75 - 79.76 -
Sinopharm Holding Hubei Co., Ltd. 125.29 - 156.04 -
Sinopharm Lerentang Hengshui Medicine Co., Ltd. 119.76 - - -
337
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Yangzhou Co., Ltd. 109.24 - 84.19 -
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading
Co., Ltd. 106.80 - - -
Sinopharm Lerentang Tangshan Medicine Co., Ltd. 99.73 - 1.68 -
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical
Co., Ltd. 94.35 - 134.91 -
Sinopharm Lerentang Hebei Medical Instrument Trade Co.,
Ltd. 92.15 - - -
Handan Sinopharm Lerentang Pharmacy Chain Co., Ltd. 83.24 - - -
Sinopharm Holding Shanxi Co., Ltd. 77.18 - 63.27 -
Shanghai Guoda Lingyun Pharmacy Co., Ltd. 66.48 - 24.99 -
Sinopharm Holding Dalian Co., Ltd. 65.79 - 26.64 -
Sinopharm Holding Jinzhou Co., Ltd. 58.72 - - -
Sinopharm Holding Tianjin Co., Ltd. 56.87 - 57.49 -
Sinopharm Holding Hunan Co., Ltd. 47.63 - 28.14 -
Sinopharm Lerentang Cangzhou Pharmaceutical Trading
Co., Ltd. 47.07 - - -
China National Medicines Co., Ltd. 33.36 - 98.51 -
China National Pharmaceutical Foreign Trade Corporation 29.94 - - -
Sinopharm Holding Fujian Co., Ltd. 25.83 - - -
Shanghai Liyi 23.77 - 5.89 -
Sinopharm Holding Xuzhou Co., Ltd. 22.74 - 25.26 -
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. 22.54 - 6.68 -
Shanghai Shengxin Pharmacy Co., Ltd. 21.75 - - -
Sinopharm Holding Jilin Co., Ltd. 20.86 - 60.01 -
Sinopharm Group Southwest Medicine Co., Ltd. 19.29 - 34.19 -
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 16.91 - 12.80 -
Foshan Chancheng District Shiwan Town Chengnan
Community Health Service Center 16.03 0.04 - -
Sinopharm Holding Yunnan Co., Ltd. 13.91 - 29.88 -
Sinopharm Holding Jiangsu Co., Ltd. 13.80 - 3.50 -
Sinopharm Holding Wuxi Co., Ltd. 12.99 - - -
Sinopharm Holding Lerentang Hebei Pharmaceutical Co.,
Ltd. 12.01 - - -
Sinopharm Holding Jiangxi Co., Ltd. 11.47 - 3.84 -
338
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Lerentang Langfang Pharmaceutical Co., Ltd. 10.24 - - -
Sinopharm Group Shanxi Co., Ltd. 9.49 - - -
Sinopharm Lerentang Xingtai Pharmaceutical Co., Ltd. 8.22 - - -
Sinopharm Holding Anshan Co., Ltd. 8.11 - - -
Sinopharm Holding Guizhou Co., Ltd. 7.96 - - -
Sinopharm Holding Shandong Co., Ltd. 7.61 - 53.33 -
Sinopharm Holding Anhui Co., Ltd. 7.45 - - -
Sinopharm Lerentang Shijiazhuang Medical Management
Co., Ltd. 7.44 - 0.11 -
Sinopharm Holding Tianjin North Medicine Co., Ltd. 6.82 - 5.20 -
Sinopharm Holding Yancheng Co., Ltd. 6.56 - - -
Sinopharm Holding Shanxi Co., Ltd. 6.34 - 33.02 -
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. 6.24 - - -
Sinopharm Holding Nantong Co., Ltd. 6.22 - 2.46 -
Sinopharm Holding Qinghai Co., Ltd. 5.73 - 8.80 -
Sinopharm Holding Ningxia Co., Ltd. 5.04 - - -
Zhijun Medicine 4.15 - 0.15 -
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. 3.91 - - -
Foshan Chengnan Fengliaoxing Medical Hospital Co., Ltd. 3.72 - 4.26 -
Sinopharm Lerentang Xintai Medicine Co., Ltd. 3.42 - - -
Sinopharm Holding Chengdu Co., Ltd. 3.41 - 5.00 -
Sinopharm Holding Anshun Co., Ltd. 2.07 - - -
Sinopharm Holding Dalian Hecheng Co., Ltd. 1.68 - 15.65 -
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. 1.55 0.01 0.45 -
Sinopharm Holding Changzhou Co., Ltd. 1.50 - 6.69 -
Sinopharm Holding Gansu Co., Ltd. 1.45 - - -
Sinopharm Lerentang Baoding Medicine Co., Ltd. 1.31 - - -
Sinopharm Lerentang Handan Medicine Co., Ltd. 1.10 - - -
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. 1.03 - - -
Sinopharm Holding Hongrun Medical Business Service
(Shanghai) Co., Ltd. 0.56 - 4.54 -
339
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. 0.37 - - -
Sinopharm Holding Zhuanye Pharmacy (Dongfang) Co.,
Ltd. 0.36 - - -
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs
Co., Ltd. 0.35 - 0.95 -
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. 0.23 - - -
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy
Co., Ltd. 0.15 - 0.59 -
Sinopharm Group Fengliaoxing Medical Hospital (Foshan
Nanhai) Co., Ltd. 0.09 - 0.05 -
Sinopharm Holding Shenyang Co., Ltd. 0.04 - - -
Sinopharm Holding Fuzhou Co., Ltd. 0.01 - 6.36 -
Yuxi Sinopharm Medicine Co., Ltd. - - 25.55 -
Sinopharm Holding Inner Mongolia Co., Ltd. - - 13.52 -
Sinopharm Lerentang Chengde Medicine Co., Ltd. - - 8.06 -
Sinopharm Holding Ulanqab Co., Ltd. - - 6.39 -
Sinopharm Holding Ningde Co., Ltd. - - 0.76 -
Sinopharm Holding Honghe Co., Ltd. - - 0.61 -
Sinopharm Holding Zunyi Co., Ltd. - - 0.31 -
Guoyaotang Pharmacy (Shanghai) Co., Ltd. - - 0.21 -
23,637.28 38.87 18,164.37 28.86
340
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Notes receivable (Including receivables financing)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Hainan Co., Ltd. 4,854.93 - 2,373.10 -
Sinopharm Holding Hainan Hongyi Co., Ltd. 944.57 - 190.14 -
Sinopharm Holding Beijing Co., Ltd. 279.54 - - -
Sinopharm Holding Shandong Co., Ltd. 135.51 - 175.46 -
Sinopharm Lerentang Medicine Co., Ltd. 90.95 - 8.86 -
Sinopharm Holding Zunyi Co., Ltd. 80.30 - - -
Sinopharm Holding Shanxi Co., Ltd. 65.04 - 61.78 -
Sinopharm Holding Guizhou Yitong Medicine Co., Ltd. 35.75 - 143.28 -
Sinopharm Holding Anshan Co., Ltd. 31.35 - - -
Sinopharm Holding Jinzhou Co., Ltd. 30.00 - - -
Sinopharm Holding Gansu Co., Ltd. 17.53 - - -
Sinopharm Holding Guizhou Co., Ltd. 15.83 - - -
Sinopharm Holding Anhui Co., Ltd. 14.09 - - -
Sinopharm Holding Henan Co., Ltd. - - 198.39 -
Sinopharm Holding Nantong Co., Ltd. - - 161.00 -
Zhijun Suzhou - - 97.39 -
Sinopharm Holding Xinjiang Special Drugs Western
Pharmaceutical Co., Ltd. - - 50.00 -
Sinopharm Holding Yunnan Co., Ltd. - - 19.22 -
Sinopharm Holding Hubei Bokang Co., Ltd. - - 18.35 -
Sinopharm Holding Yancheng Co., Ltd. - - 13.42 -
Sinopharm Group Shanxi Co., Ltd. - - 11.47 -
6,595.39 - 3,521.86 -
341
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Other receivables
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Zhijun Suzhou 4,633.42 4,633.42 4,536.03 4,536.03
Sinopharm Group Medicine Logistic Co., Ltd. 255.98 - 173.71 -
Du Longfeng 205.73 - - -
Li Huichun 205.73 - - -
Sinopharm Holding Fujian Co., Ltd. 115.83 - 276.08 -
Shyndec Pharma 98.39 - 98.39 -
Sinopharm Holding (China) Financing Lease Co., Ltd. 57.00 - 2.87 -
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 40.00 - - -
Sinopharm Holding Inner Mongolia Co., Ltd. 25.65 - - -
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 22.00 - - -
Zhijun Medicine 20.44 - 22.27 0.06
Sinopharm Lerentang Hebei Medical Instrument Trade Co.,
Ltd. 4.85 - 4.85 -
Zhang Haiyan 3.00 - - -
Zhijun Pingshan 1.85 - 1.85 -
Sinopharm Guangdong Medicine Device Supply Chain Co.,
Ltd. 1.74 - 2.31 -
Zhijun Trade 1.08 - 2.54 -
Sinopharm Holding Xinjiang Special Drugs Kashgar
Pharmaceutical Co., Ltd. 0.72 - - -
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 0.50 0.10 0.50 0.10
Xinjiang Baitong Property Service Co., Ltd. 0.13 - - -
Sinopharm Group Guangdong Medicine Device Co., Ltd. 0.01 - - -
Sinopharm Group - - 2,200.00 -
Pu’er Songmao Medicine Group Co., Ltd. - - 688.68 -
Henan Wanxitang Pharmacy Co., Ltd. - - 104.31 -
Shanghai Dingqun - - 83.49 -
Sinopharm Group Xinjiang Special Drugs National
Pharmaceutical Co., Ltd. - - 10.00 -
5,694.05 4,633.52 8,207.88 4,536.19
342
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Advances to suppliers
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Shanxi Co., Ltd. 1,774.71 - 334.72 -
Sinopharm Group Guangxi Medical Device Co., Ltd. 185.00 - - -
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 47.57 - - -
Chongqing Yaoyou Pharmaceutical Co., Ltd. 40.90 - 74.25 -
Sinopharm Group Guorui Medicine Co., Ltd. 30.78 - 39.96 -
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. 26.08 - - -
Chengdu Rongsheng Pharmacy Co., Ltd. 21.71 - 55.54 -
Lanzhou Biotechnology Development Co., Ltd. 18.00 - 0.06 -
Hunan Dongting Pharmaceutical Co., Ltd. 17.63 - - -
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 13.73 - 59.98 -
Suzhou Erye Pharmaceutical Limited Company 12.17 - 3.31 -
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. 7.93 - - -
Guilin Pharmaceutical Co., Ltd. 7.46 - 5.42 -
Sinopharm Group 5.96 - 148.66 -
Sinopharm Holding Sub Marketing Center Co., Ltd. 4.47 - 120.47 -
Zhijun Medicine 4.19 - 2.98 -
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 2.88 - - -
Sinopharm Holding Beijing Co., Ltd. 1.49 - 13.00 -
Hubei Sinopharm Zhonglian Medicine Co., Ltd. 1.35 - - -
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 1.24 - - -
Sinopharm Holdings Beijing Huahong co., Ltd. 1.10 - - -
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 0.90 - 6.58 -
Jinzhou Avanc Pharmaceutical Co., Ltd. 0.84 - 0.02 -
Sinopharm Holding Changsha Co., Ltd. 0.45 - - -
Sinopharm Device (Guangdong) Medical Technology Co.,
Ltd. 0.40 - - -
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. 0.14 - 8.25 -
Sinopharm Holding Yancheng Co., Ltd. 0.07 - - -
Shyndec Pharma 0.01 - 75.85 -
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 0.01 - 49.97 -
Jiangxi Erye Medicine Marketing Co., Ltd. - - 278.64 -
China National Medicines Co., Ltd. - - 20.49 -
Shantou Jinshi Powder Injection Co., Ltd. - - 13.80 -
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. - - 10.22 -
343
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Advances to suppliers (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Chengdu Institute of Biological Products Co., Ltd. - - 9.75 -
Beijing Sinopharm Tianyuan Real Estate & Property
Management Co., Ltd. - - 9.53 -
China National Pharmaceutical Foreign Trade Corporation - - 7.20 -
Shanghai Tongyu Information Technology Co., Ltd. - - 2.35 -
Sinopharm Holding Hunan Co., Ltd. - - 1.70 -
Foshan Winteam Pharmaceutical Group Ltd. - - 1.40 -
Sinopharm Holding Chengdu Co., Ltd. - - 1.32 -
Xinjiang Baitong Property Service Co., Ltd. - - 1.31 -
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. - - 1.14 -
China National Pharmaceutical Industry Co., Ltd. - - 0.55 -
Sinopharm Holding Hubei Co., Ltd. - - 0.47 -
Sinopharm Holding Yangzhou Co., Ltd. - - 0.13 -
2,229.17 - 1,359.02 -
Amounts due from related parties are interest-free and unsecured with no fixed term on repayment, except
that notes receivable from related parties have fixed terms of repayment, and entrusted loans from related
parties have fixed terms of repayment with interest.
344
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties
Accounts payable
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Sub Marketing Center Co., Ltd. 10,059.79 6,680.85
China National Medicines Co., Ltd. 5,351.01 4,042.60
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 4,496.74 1,716.24
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. 3,137.29 3,172.37
Sinopharm Group 3,016.91 2,541.17
Sinopharm Holding Shenyang Co., Ltd. 1,704.48 225.70
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 1,429.96 2,401.57
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 1,321.16 327.92
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 1,191.78 818.88
Sinopharm Holding Shanxi Co., Ltd. 870.63 853.24
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 692.61 197.89
Sinopharm Holding Jiangsu Co., Ltd. 621.12 485.71
Sinopharm Group Shanxi Medical Devices Co., Ltd. 610.59 -
Sinopharm Holding Yangzhou Co., Ltd. 605.68 645.32
Tibet Yaoyou Medicines Co., Ltd. 559.97 99.85
Main Luck Pharmaceutical 558.62 528.48
Sinopharm Holding Fujian Co., Ltd. 530.65 343.43
Sinopharm Yixin Pharmaceutical Co., Ltd. 522.37 99.82
Foshan Winteam Pharmaceutical Group Ltd. 503.23 431.46
Jinzhou Avanc Pharmaceutical Co., Ltd. 497.72 388.56
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. 487.37 -
Sinopharm Holding Jilin Co., Ltd. 477.47 -
Sinopharm Holding Changzhou Co., Ltd. 406.12 320.14
Zhijun Pingshan 385.42 661.86
Sinopharm Holding Xinjiang Xinte Shenrong Pharmaceutical Co., Ltd. 375.32 -
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. 358.88 386.97
Shanghai Henlius Biopharmaceuticals Co., Ltd. 348.94 -
Chongqing Yaoyou Pharmaceutical Co., Ltd. 331.98 600.41
Sinopharm Holding Henan Co., Ltd. 320.69 297.06
Sinopharm Holding Pingdingshan Co., Ltd. 311.02 531.68
Sinopharm Holding Inner Mongolia Co., Ltd. 276.13 399.74
China Otsuka Pharmaceutical Co., Ltd. 267.79 259.84
Sinopharm Holding Ningxia Co., Ltd. 241.45 235.44
Sinopharm Holding Beijing Co., Ltd. 239.19 339.70
Jinzhou Avanc Medicine Co., Ltd. 225.15 21.46
345
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Zhijun Medicine 220.49 619.90
Shanghai International Pharmaceutical Trade Co., Ltd. 214.08 127.87
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 202.93 84.89
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. 172.83 5.28
Yunnan Sinopharm Holding Dongchang Medicine Co., Ltd. 166.05 81.10
Sinopharm Group Guangxi Medical Device Co., Ltd. 163.72 -
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. 149.57 21.99
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 140.45 102.14
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. 140.26 595.17
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 134.58 234.13
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. 131.59 156.56
China National Pharmaceutical Foreign Trade Corporation 126.42 0.09
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 119.90 0.01
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. 117.94 144.73
Sinopharm Holding Jinzhou Co., Ltd. 117.69 82.23
Sichuan Hexin Pharmaceutical Co., Ltd. 116.47 180.11
Sinopharm Group Guorui Medicine Co., Ltd. 102.96 66.14
Shanghai Chaohui Pharmaceutical Co., Ltd. 102.07 80.74
Shenzhen Wanwei Medicine Trading Co., Ltd. 88.40 280.99
Sinopharm Holding Hulun Buir Co., Ltd. 86.27 42.89
Sinopharm Holding Wuxi Co., Ltd. 83.97 123.56
Sinopharm Holding Heilongjiang Co., Ltd. 81.13 71.19
Sinopharm Holding Tongliao Co., Ltd. 80.23 54.07
Sinopharm Liaoning Medical Equipment Co., Ltd. 80.12 11.99
Sinopharm Holding Shandong Co., Ltd. 79.34 20.77
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. 79.27 -
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. 76.39 0.39
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 71.46 140.07
Sinopharm Holding Hubei Co., Ltd. 70.65 1,384.40
Yichang Humanwell Pharmaceutical Co., Ltd. 70.24 125.17
Sinopharm Holding Shanxi Co., Ltd. 69.89 1.27
Hunan Dongting Pharmaceutical Co., Ltd. 66.74 77.36
Sinopharm Holding Xinjiang Special Drugs Karamay Pharmaceutical Co., Ltd. 65.96 50.24
Sinopharm Holding Fuzhou Co., Ltd. 65.50 80.22
Fujian Chentian Jinling Pharmaceutical Co., Ltd. 63.99 63.97
346
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. 62.61 112.39
China National Pharmaceutical Industry Co., Ltd. 61.49 73.60
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 56.01 37.96
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 55.37 71.11
Sinopharm Holding Xiamen Co., Ltd. 55.16 140.81
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 45.05 83.70
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 41.24 46.41
Sinopharm Holding Hunan Co., Ltd. 40.71 -
Sinopharm Holding Xinjiang Special Drugs Kashgar Pharmaceutical Co., Ltd. 39.03 13.25
Chengdu Institute of Biological Products Co., Ltd. 37.44 56.16
Sinopharm Holding Dalian Co., Ltd. 37.30 13.72
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. 35.57 -
Suzhou Erye Pharmaceutical Limited Company 35.04 62.30
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. 34.77 13.17
Sinopharm Holding Shanxi Jinzhong Co., Ltd. 30.45 -
Shanghai Transfusion Technology Co., Ltd. 30.18 39.66
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. 28.64 46.18
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. 27.56 49.04
Sinopharm Holding Anhui Huaning Medicine Co., Ltd. 24.87 119.03
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. 23.60 -
Jiangsu Huanghe Pharmaceutical Co., Ltd. 22.99 43.37
Sinopharm ChuanKang Pharmaceutical Co., Ltd. 22.81 73.57
Sinopharm Holding Putian Co., Ltd. 22.46 22.54
Sinopharm Holding Anshan Co., Ltd. 21.05 -
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. 20.62 86.55
Sinopharm Holding Quanzhou Co., Ltd. 20.33 1.60
Shanghai Merro Pharmaceutical Co., Ltd. 19.67 42.60
Shanghai Shangsheng Biological Products Co., Ltd. 19.44 -
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 18.96 28.59
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 18.22 21.60
Shenyang Hongqi Pharmaceutical Co., Ltd. 16.60 31.51
347
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
GlaxoSmithKline Pharmaceuticals (Suzhou) Co., Ltd. 15.70 -
Sinopharm Holding Yangzhou Biological Products Co., Ltd. 14.92 11.62
Sinopharm Wuhan Zhonglian Siyao Pharmaceutical Co., Ltd. 14.72 9.22
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. 13.60 22.48
Jiangxi Erye Medicine Marketing Co., Ltd. 13.43 -
Sinopharm Beijing Huamiao Pharmaceutical Co., Ltd. 13.18 3.10
Sinopharm Holding Yunnan Co., Ltd. 12.81 -
Sinopharm Holding Special Drugs Shihezi Pharmaceutical Co., Ltd. 12.70 -
Sinopharm Holding Pu’er Co., Ltd. 12.65 17.98
Huayi Pharmaceutical Co., Ltd. 11.02 22.41
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. 10.69 2.32
Sinopharm Holding Hunan Pharmaceutical Development Co., Ltd. 10.54 11.85
Chengdu Rongsheng Pharmacy Co., Ltd. 10.00 20.30
Sinopharm Holding Tianjin Co., Ltd. 9.51 1.20
Sinopharm Xinjiang Pharmaceutical Co., Ltd. 9.48 -
Sinopharm Device (Guangdong) Medical Technology Co., Ltd. 7.61 -
Shantou Jinshi Powder Injection Co., Ltd. 7.26 12.45
Sinopharm Holding Bayannur Co., Ltd. 6.99 16.95
Sinopharm Holdings Beijing Huahong co., Ltd. 6.83 36.10
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. 5.98 33.47
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. 4.80 5.31
Sinopharm Holding Dezhou Co., Ltd. 4.58 17.22
Sinopharm Holding Ulanqab Co., Ltd. 3.61 3.38
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. 3.29 16.45
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. 3.10 3.10
Sinopharm Holding Zhejiang Co., Ltd. 3.03 -
China Medical Equipment Shandong Co., Ltd. 2.98 21.62
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. 2.85 26.04
Sinopharm Sanyi Medicine (Wuhu) Co., Ltd. 2.66 3.31
Chongqing Haisiman Pharmaceutical Co., Ltd. 1.85 0.01
Sinopharm Holding Taizhou Co., Ltd. 1.76 5.55
Sinopharm Holding Baotou Co., Ltd. 1.64 -
Sinopharm Holding Changsha Gaoxin Medicine Co., Ltd. 1.29 -
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 1.09 3.48
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. 0.74 -
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. 0.55 7.38
348
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Jinan Co., Ltd. 0.50 5.82
Changchun Changsheng Gene Pharmaceutical Co., Ltd. 0.38 0.30
Sinopharm Holding Dalian Hecheng Co., Ltd. 0.32 1.61
Sinopharm Holding Shanxi Jincheng Co., Ltd. 0.22 0.21
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. 0.22 0.11
Sinopharm Holding Zhangzhou Co., Ltd. 0.21 0.10
Sinopharm Holding Ordos Co., Ltd. 0.18 0.18
Chengdu List Pharmaceutical Co., Ltd. 0.18 17.89
Sinopharm Nutraceuticals (Shanghai) Co., Ltd. 0.15 -
China National Medical Device (Hui Zhou) Co., Ltd. 0.08 -
Guilin Pharmaceutical Co., Ltd. 0.06 0.12
Shyndec Pharma 0.06 105.98
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. 0.05 -
Sinopharm Group Shanghai Medicine Device Co., Ltd. 0.02 1.65
Sinopharm Holding Liaocheng Co., Ltd. 0.02 0.02
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. 0.01 0.07
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 0.01 -
Sinopharm Holding Hubei Guoda Pharmacy Co., Ltd. - 149.40
Sinopharm Holding Yancheng Co., Ltd. - 68.89
Sinopharm Holding Changsha Co., Ltd. - 28.83
Sinopharm Holding Lianyungang Co., Ltd. - 15.62
Sinopharm Holding Anhui Co., Ltd. - 14.98
Sinopharm Holding Shanxi Runhe Medicine Co., Ltd. - 4.03
Sinopharm Holding Jiangxi Co., Ltd. - 3.80
Sinopharm Holding Suzhou Co., Ltd. - 1.37
Sinopharm Wuhan Blood Products Co., Ltd. - 1.16
Sinopharm Industry Investment Co., Ltd. - 1.13
Sinopharm Hebei Medical Instrument Co., Ltd. - 1.05
Sinopharm Holding Lunan Co., Ltd. - 0.76
Sinopharm Holding Rizhao Co., Ltd. - 0.63
Sinopharm Anhui Medical Device Co., Ltd. - 0.52
Sinopharm Holding Tonghua Co., Ltd. - 0.42
Sinopharm Lerentang Medicine Co., Ltd. - 0.12
Zhijun Trade - 0.05
48,542.13 37,258.53
349
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Notes payable
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Shanxi Co., Ltd. 14,748.48 8,709.55
Sinopharm Holding Sub Marketing Center Co., Ltd. 14,500.77 14,738.71
Sinopharm Lerentang Medicine Co., Ltd. 13,351.31 8,149.93
Sinopharm Holding Shanxi Co., Ltd. 9,647.58 2,620.38
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 4,248.18 3,110.02
Lanzhou Biotechnology Development Co., Ltd. 3,492.00 1,794.00
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 3,490.46 4,165.56
Sinopharm Holding Shenyang Co., Ltd. 2,366.63 9,431.86
China National Medicines Co., Ltd. 2,124.05 4,009.35
Sinopharm Holding Inner Mongolia Co., Ltd. 2,042.98 2,990.22
Sinopharm Group 1,566.58 -
Sinopharm Holding Fujian Co., Ltd. 1,560.70 1,208.06
Sinopharm Yixin Pharmaceutical Co., Ltd. 1,441.63 10.75
Chengdu Rongsheng Pharmacy Co., Ltd. 1,036.88 202.50
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 568.10 26.74
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 475.58 -
Sinopharm Holding Lunan Co., Ltd. 450.00 1,065.84
Sinopharm Holding Yangzhou Co., Ltd. 430.00 -
Sinopharm Holding Xiamen Co., Ltd. 317.32 578.10
Sinopharm Holding Pingdingshan Co., Ltd. 300.00 -
Sinopharm Lerentang Shijiazhuang Medicine Co., Ltd. 294.62 559.81
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 284.04 -
Chongqing Yaoyou Pharmaceutical Co., Ltd. 269.34 437.16
Sinopharm Holding Tianjin Co., Ltd. 236.55 -
China Otsuka Pharmaceutical Co., Ltd. 232.17 -
Sinopharm Holding Ningxia Co., Ltd. 213.96 150.00
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 197.82 67.87
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. 191.17 -
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 177.77 704.76
China National Medical Device Co., Ltd. 174.34 -
Sinopharm Group Shanxi Medical Devices Co., Ltd. 143.10 -
Sinopharm Holding Quanzhou Co., Ltd. 134.73 4.51
350
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Notes payable (Continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Main Luck Pharmaceutical 127.41 236.09
Sinopharm Holding Dalian Co., Ltd. 126.93 99.20
Sinopharm Holding Jinzhou Co., Ltd. 122.21 231.53
Foshan Winteam Pharmaceutical Group Ltd. 104.77 -
Sinopharm Holding Yancheng Co., Ltd. 96.73 54.43
Sinopharm Holding Hunan Co., Ltd. 76.97 340.61
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 75.41 32.05
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 71.52 11.90
Jinzhou Avanc Medicine Co., Ltd. 65.51 -
Sinopharm Holding Jinan Co., Ltd. 65.00 95.00
Zhijun Medicine 63.62 108.71
Shenzhen Wanwei Medicine Trading Co., Ltd. 59.78 514.88
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. 56.41 -
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. 53.72 -
Sinopharm Holding Jilin Co., Ltd. 43.01 -
Sinopharm Wuhan Blood Products Co., Ltd. 42.00 19.64
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 27.86 16.92
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 26.75 -
Shanghai Transfusion Technology Co., Ltd. 25.15 31.19
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 11.67 -
Sinopharm Holding Shanxi Jinzhong Co., Ltd. 10.22 -
Sinopharm Holding Nanping Newforce Co., Ltd. 10.06 -
Fujian Chentian Jinling Pharmaceutical Co., Ltd. 7.12 -
Sinopharm Holding Anshan Co., Ltd. 6.34 -
Sinopharm Holding Changsha Co., Ltd. 2.98 17.16
Sinopharm Holding Changzhou Co., Ltd. - 202.00
Yichang Humanwell Pharmaceutical Co., Ltd. - 131.34
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. - 103.36
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. - 83.30
Zhijun Pingshan - 52.97
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. - 42.88
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. - 34.95
351
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Notes payable (continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. - 21.90
Shenyang Hongqi Pharmaceutical Co., Ltd. - 21.13
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. - 14.04
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. - 10.84
Sinopharm Holding Heilongjiang Co., Ltd. - 4.66
Sinopharm Lerentang Hebei Medical Device Supply Chain Management Co.,
Ltd. - 0.82
82,087.99 67,269.18
352
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Other payables
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group 414.65 6,249.76
Zhang Zhenfang 392.00 311.50
Sinopharm Group Shanghai Co., Ltd. 361.95 166.04
Sinopharm Group Medicine Logistic Co., Ltd. 282.57 575.57
China National of Traditional & Herbal Medicine Co., Ltd. 130.00 130.00
Pingdingshan Pusheng Pharmaceutical Co., Ltd. 51.59 -
Sinopharm Holding Yangzhou Co., Ltd. 37.26 372.57
Shanghai Beiyi 36.49 35.79
Shanghai Tongyu Information Technology Co., Ltd. 24.99 -
Sinopharm Health Online Co., Ltd. 18.60 300.83
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. 16.59 -
Sinopharm Holding Hunan Weian Pharmacy Medicine Chain Company Limited 10.46 10.22
Fujian Chentian Jinling Pharmaceutical Co., Ltd. 5.00 -
Sinopharm Holding Sub Marketing Center Co., Ltd. 3.79 3.82
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 2.24 -
Zhang Haiyan 0.14 -
Chengdu Institute of Biological Products Co., Ltd. 0.03 -
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. 0.01 -
Shenzhen Wanwei Medicine Trading Co., Ltd. 0.01 -
Shanghai Dingqun - 1,000.00
China Medicine Group Chongqing Medicine Design Institute - 517.32
Foshan Chancheng Central Hospital Co., Ltd. - 26.50
Sinopharm Holding (Tianjin Binhai) Pharmaceutical Co., Ltd. - 24.18
Sinopharm Pharmaceutical Logistics Co., Ltd. - 2.08
Sinopharm Group Medicine Logistic Co., Ltd. Guangzhou Branch - 2.00
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. - 1.00
Gu Jinhua - 0.21
1,788.37 9,729.39
353
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Contract liabilities
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Nantong Co., Ltd. 107.45 32.00
Chindex Shanghai International Trading Co., Ltd. 78.36 -
Sinopharm Holding Yunnan Co., Ltd. 18.67 10.52
Sinopharm Holding Anhui Co., Ltd. 15.49 -
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 9.89 -
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. 9.76 -
Sinopharm Holding Shenyang Co., Ltd. 6.44 -
Sinopharm Lerentang Medicine Co., Ltd. 4.04 -
Sinopharm Holding Wuhu Co., Ltd. 3.04 -
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. 2.57 -
Sinopharm Holding Jilin Co., Ltd. 2.30 -
Sinopharm Holding Gansu Co., Ltd. 2.20 2.25
Sinopharm Holding Hulun Buir Co., Ltd. 2.12 2.12
Sinopharm Group Shanxi Co., Ltd. 1.48 -
Sinopharm Lerentang Chengde Medicine Co., Ltd. 1.10 -
Sinopharm Lerentang Hengshui Medicine Co., Ltd. 1.03 -
Sinopharm Holding Taizhou Co., Ltd. 0.66 -
Sinopharm Holding Chongqing Co., Ltd. 0.35 0.08
Sinopharm Holding Guizhou Medical Device Co., Ltd. 0.11 0.06
Dongyuan accord 0.09 -
Sinopharm Holding Jiangxi Co., Ltd. 0.02 -
Sinopharm Holding Inner Mongolia Co., Ltd. 0.01 0.01
Sinopharm Holding Wenzhou Co., Ltd. - 5.78
Sinopharm Holding Guizhou Co., Ltd. - 4.70
Sinopharm Holding Hubei Hongyuan Co., Ltd. - 2.52
Sinopharm Holding Quanzhou Co., Ltd. - 1.91
Sinopharm Group Guangdong Medicine Device Co., Ltd. - 1.04
Sinopharm Holding Hunan Co., Ltd. - 0.83
Sinopharm Group Guangxi Medical Device Co., Ltd. - 0.54
China National Pharmaceutical Foreign Trade Corporation - 0.12
Sinopharm Holding Chengdu Co., Ltd. - 0.09
Sinopharm Guangdong Medical Examination Co., Ltd. - 0.06
267.18 64.63
354
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
2020 2019
(RMB‘0,000) (RMB‘0,000)
Entrusted borrowings
CNPGC (1) 3,163.72 3,163.90
Jilin Province Yihe Investment Consulting Co., Ltd. (2) 5,670.00 -
8,833.72 3,163.90
(1) CNPGC entrusted Sinopharm Group Finance Co., Ltd. with this borrowing to the Group. The entrusted
borrowing includes the principal of RMB31,600.00 thousand and the outstanding interest receivable of
RMB37.20 thousand.
(2) Jilin Province Yihe Investment Consulting Co., Ltd. entrusted Changchun Branch of China Everbright Bank
Co., Ltd. with this borrowing to the Group.
Short-term borrowings
Sinopharm Group Finance Co., Ltd. 1,433.87 3,999.39
Other non-current liabilities
Sinopharm Group 3,506.17 3,506.17
355
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Lease liabilities
2020 2019
Amount Include: Amount Include:
within 1 year within 1 year
(RMB‘0,000) (RMB‘0,000) (RMB‘0,000) (RMB‘0,000)
Shaoguan Wujiang District Muyang Medicine Information
Consultant Co., Ltd. 662.88 75.92 55.28 55.28
Lerentang Investment Group Co., Ltd. 611.25 611.25 1,242.27 607.73
Zhang Yechuan 520.19 57.48 - -
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. 343.45 44.80 - -
Guangdong Jiyuantang Development Co., Ltd. 308.59 206.06 493.39 184.80
Xiong Xinyuan 287.33 23.65 - -
Shenyang Shengdiou Trading Co., Ltd. 146.86 34.46 - -
Zhang Haiyan 50.35 15.34 - -
Gu Haiqun 42.79 19.52 60.51 17.71
Sinopharm Holding (China) Financing Lease Co., Ltd. 38.88 46.95 386.17 234.82
Sinopharm Xinjiang Pharmaceutical Co., Ltd. 37.90 37.90 74.19 36.29
Zhijun Pingshan 33.88 8.94 42.44 8.56
Beijing Huafang Investment Co., Ltd. 33.66 24.21 - -
Shanghai Baizhong Business Development (Group) Co., Ltd. 30.01 30.01 - -
Sinopharm Group 17.23 17.23 67.47 50.24
Sinopharm Holding Beijing Co., Ltd. 13.09 13.09 63.37 50.28
Pu'er Songmao Medicine Group Co., Ltd. 3.73 3.73 1,724.74 131.26
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. - - 4,166.45 859.66
Linyi Pharmaceutical Group Co., Ltd. - - 634.73 155.06
Sinopharm Holding Yangzhou Co., Ltd. - - 366.61 366.61
Taishan Xiangranhui Trade Co., Ltd. - - 217.40 40.55
Gu Jinhua - - 195.64 35.70
Shenyang Pharmaceutical Co., Ltd. - - 148.19 28.29
Beijing Sinopharm Tianyuan Real Estate & Property
Management Co., Ltd. - - 35.70 43.77
Sinopharm Holding Rizhao Co., Ltd. - - 29.51 28.11
China National Medicines Co., Ltd. - - 28.11 19.58
Shenzhen Jiufeng Investment Co., Ltd. - - 19.29 19.29
3,182.07 1,270.54 10,051.46 2,973.59
Other payables are interest-free and unsecured with no fixed term on repayment, expects the related party
borrowings, long-term payables, lease liabilities with fixed terms of repayment with interest, and notes
payable to related parties have fixed terms of repayment.
9. Cash deposit with a related party
2020 2019
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group Finance Co., Ltd. 10,177.99 54.90
In year 2020, the annual interest rates of the above deposits are 0.35% to 1.89%. (In year 2019, the annual
interest rates of the above deposits are 0.35% to 1.15%.)
356
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XI Commitments and contingencies
1. Commitments
(1) Capital commitments
Capital expenditures contracted for at the balance sheet date but not recognised in the balance
sheet are analysed as follows:
31 December 2020 31 December 2019
(RMB‘0,000) (RMB‘0,000)
Capital commitments 42.16 42.16
Investment commitments - 6,000.00
42.16 6,042.16
2. Contingencies
As of the balance sheet date, no contingencies of the Group were required to disclose.
357
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XII Events after the balance sheet date
Pursuant to the resolution of the General Meeting of the Shareholders on 31 March 2021, the
Company paid a cash dividend of RMB8.00 for every 10 shares to all shareholders, which is
calculated on the basis of 428,126,983 shares in issue, with an aggregate amount of
RMB342,501,586.40. This resolution had yet to be approved by the shareholders’ meeting.
XIII Other significant events
1. Segment reporting
Operating segments
For management purposes, the Group is organised into business units based on its products and
services and has three reportable operating segments as follows:
(1) The Head Office, which is mainly engaged in the investment and management of businesses;
(2) Pharmaceutical distribution segment, which is mainly engaged in the distribution of medicine
and pharmaceutical products to customers;
(3) Retail pharmacy segment, which is the management of the operation of Guoda Drugstore.
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 measured consistently with the Group’s
profit before tax.
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.
358
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
1. Segment reporting (Continued)
Operating segments (Continued)
2020
Elimination between
Head Office Pharmaceutical distribution Pharmaceutical retail Total
segments
Operating revenue 9,487,841.49 41,069,771,850.60 19,437,660,100.65 (867,464,780.71) 59,649,455,012.03
Including: Revenue from external
customers 7,791,167.36 40,204,472,088.75 19,437,191,755.92 - 59,649,455,012.03
Revenue from
inter-segment
transactions 1,696,674.13 865,299,761.85 468,344.73 (867,464,780.71) -
Interest income 136,746,373.87 47,776,232.42 73,451,556.94 (121,518,173.13) 136,455,990.10
Interest expense (38,837,835.94) (244,755,374.81) (96,280,488.16) 121,684,535.12 (258,189,163.79)
Income from investments in
associates 353,352,207.87 (1,082,757.65) 2,076,255.43 - 354,345,705.65
Impairment losses - (4,929,690.18) (249,595.57) - (5,179,285.75)
Credit impairment losses (998,033.21) (20,532,463.36) (4,444,823.51) - (25,975,320.08)
Depreciation and amortisation (1,791,874.52) (167,013,527.37) (1,025,213,331.17) - (1,194,018,733.06)
Gross profit 1,010,471,435.72 1,113,461,641.94 643,880,019.14 (610,576,648.02) 2,157,236,448.78
Income taxes (10,594,497.17) (258,053,622.70) (167,291,930.19) - (435,940,050.06)
Net profit 999,876,938.55 855,408,019.24 476,588,088.95 (610,576,648.02) 1,721,296,398.72
Total assets 14,507,966,007.38 22,611,218,131.54 15,456,873,721.83 (12,981,524,389.10) 39,594,533,471.65
Total liabilities (3,662,674,685.95) (16,513,139,037.74) (9,917,411,077.29) 7,387,318,648.85 (22,705,906,152.13)
Long-term equity investments in
associates 2,258,990,817.58 13,225,570.12 14,803,240.29 - 2,287,019,627.99
Accrual of other non-current assets
except long-term equity
investments (17,191,786.48) 252,812,325.09 2,782,979,773.37 (1,281,010.92) 3,017,319,301.06
359
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
1. Segment reporting (Continued)
Operating segments (Continued)
2019
Head Office Pharmaceutical distribution Pharmaceutical Retail Elimination between segments Total
Operating revenue 9,665,928.48 40,013,926,107.78 13,494,651,831.77 (731,436,391.75) 52,786,807,476.28
Including: Revenue from external customers 8,006,007.92 39,285,482,715.53 13,493,318,752.83 52,786,807,476.28
Revenue from inter-segment transactions 1,659,920.56 728,443,392.25 1,333,078.94 (731,436,391.75) -
Interest income 108,928,333.91 39,346,397.17 87,158,813.17 (95,572,571.11) 139,860,973.14
Interest expense (26,665,774.48) (274,477,177.66) (70,970,166.24) 95,623,071.70 (276,490,046.68)
Investment income 332,334,692.76 (2,233,828.42) 1,071,038.53 - 331,171,902.87
Impairment losses (1,857,279.52) 332,209.46 (1,513,107.62) - (3,038,177.68)
Credit impairment losses (45,382,201.36) (5,137,165.27) (2,536,833.49) - (53,056,200.12)
Depreciation and amortisation (1,519,764.30) (143,163,527.20) (782,416,224.27) - (927,099,515.77)
Gross profit 1,134,658,290.00 1,110,966,580.04 417,720,085.51 (811,888,777.53) 1,851,456,178.02
Income taxes 3,069,276.24 (264,494,788.78) (109,871,212.24) - (371,296,724.78)
Net profit 1,137,727,566.24 846,471,791.26 307,848,873.27 (811,888,777.53) 1,480,159,453.24
Total assets 12,874,025,306.77 20,332,642,113.61 11,681,991,688.47 (10,859,815,894.65) 34,028,843,214.20
Total liabilities (2,822,975,182.11) (14,417,324,193.49) (6,474,839,491.71) 5,260,275,929.82 (18,454,862,937.49)
Long-term equity investments in associates 2,084,079,098.25 8,308,327.77 12,726,984.86 - 2,105,114,410.88
Accrual of other non-current assets except long-term
equity investments 6,535,138.34 251,618,667.14 1,983,635,745.30 (1,116,517.76) 2,240,673,033.02
360
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
2. Leases
(1) As lessor
The Group has entered into operating leases on some of its houses and buildings, and the lease
term is 1 year to 10 years. All leases include a clause to enable revision of the rental charge on an
annual basis according to prevailing market conditions. In 2020, the rental income recognised by
the Group on those houses and buildings was RMB74,161,565.05 (2019: RMB76,018,788.10), for
details of which, please refer to Note V (44). Details of the leased houses and buildings are
disclosed in Note V (13) Investment properties.
Operating leases
The profit or loss relating to operating leases is as follows:
2020 2019
Lease income 74,161,565.05 76,018,788.10
Including: Income relating to variable
lease payments not
included in the lease
receivable - -
The future minimum lease receivables due under the signed irrevocable operating lease contracts
are summarised as follows:
2020 2019
Within 1 year, inclusive 63,220,587.31 46,302,375.09
1 to 2 years, inclusive 31,911,202.23 26,381,198.72
2 to 3 years, inclusive 23,381,199.28 18,340,448.75
3 to 4 years, inclusive 15,814,769.84 15,209,886.01
4 to 5 years, inclusive 14,032,816.35 11,051,502.87
Over 5 years 34,581,707.82 32,191,270.04
182,942,282.83 149,476,681.48
361
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
2. Leases (Continued)
(2) As lessee
2020 2019
Interest expense on lease liabilities 85,172,959.79 76,192,008.38
Expenses relating to short-term leases
accounted for applying practical
expedients 149,964,881.54 144,926,198.55
Expenses relating to leases of
low-value assets accounted for
applying practical expedients (other
than short-term leases) 1,665,822.79 324,213.61
Variable lease payments not included
in the measurement of lease
liabilities 326,685.01 851,273.83
Income from subleasing right-of-use
assets 39,592,830.17 34,838,940.81
Total cash outflow for leases 1,135,337,845.71 881,100,658.01
The Group has lease contracts for various items of houses and buildings, machinery, vehicles
and other equipment used in its operations. Leases of houses and buildings and machinery
generally have lease terms of 1 year to 6 years, while those of vehicles and other equipment
generally have lease terms of 1 year to 2 years. There are several lease contracts that include
extension and termination options and variable lease payments. Refer to “Potential future cash
outflows not included in the measurement of lease liabilities” for the impact of clauses relating to
variable lease payments on future potential cash outflows.
Potential future cash outflows not included in the measurement of lease liabilities
The potential future cash outflows that the Group does not include in the measurement of lease
liabilities mainly arise from variable lease payments, extension and termination options in lease
contracts, residual value guarantees, and risk exposures such as leases that have been
promised but not yet commenced.
Variable lease payments
Some of the property leases within the Group contain variable lease payment clauses that are
linked to sales generated from the underlying store. These clauses are used, when possible, in
order to match lease payments with stores generating higher cash flows.
In 2020, the real estate lease of the Group is as follows:
Stores Fixed payments Variable Total payments
payments
Fixed payments only 8,233 1,127,987,562.15 - 1,127,987,562.15
Variable payments 7 1,219,261.25 326,685.01 1,545,946.26
A 20% increase in sales across all stores in the Group would be expected to increase total lease
payments by approximately 0.03%.
362
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
2. Leases (Continued)
(2) As lessee (Continued)
In 2019, the real estate lease of the Group is as follows:
Stores Fixed payments Variable Total payments
payments
Fixed payments only 4,662 762,662,439.18 - 762,662,439.18
Variable payments 8 1,513,349.01 851,273.83 2,364,622.84
A 20% increase in sales across all stores in the Group would be expected to increase total lease
payments by approximately 0.06%.
Leases that have been promised but not yet commenced
The leases that the Group has promised but have not yet commenced are expected to have future
cash outflows as follows:
2020 2019
Within 1 year, inclusive 10,999,774.97 29,127,042.16
1 to 2 years, inclusive 9,064,124.03 19,572,477.03
2 to 3 years, inclusive 7,953,910.54 12,051,712.29
Over 3 years 9,528,398.65 12,969,470.09
37,546,208.19 73,720,701.57
Other information relating to leases
For right-of-use assets, refer to Note V (16); for practical expedients of short-term leases and
leases of low-value assets, refer to Note III (29); and for lease liabilities, refer to Note V (32).
3. Comparison of data
As noted in Note VI (2), the Group acquired 75% equity of Pudong Medicine through business
combinations involving entities under common control during the year. When the Group compiling
the comparative financial statements of the 2020 consolidated financial statements, it is deemed
that the parties involved in the consolidation existed in their current state before the ultimate
controlling party began to exercise control, and the Group adjusted the previous comparative
financial statements. Correspondingly, certain data from previous years have been adjusted, and
certain comparative data have been reclassified and restated. The consolidated shareholders'
equity at the beginning of 2020 increased by RMB214,142,436.48 due to the business merger
under the common control mentioned above, of which the equity attributable to the parent
company increased by RMB104,729,569.96, and minority shareholders' equity increased by
RMB109,412,866.52.
363
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements
1. Notes receivable
31 December 2020 31 December 2019
Commercial acceptance bills 30,984,449.44 14,900,068.42
As at 31 December 2020 and 31 December 2019, no notes receivable were pledged.
As at 31 December 2020 and 31 December 2019, no notes receivable were endorsed or discounted by the Group to
other parties which were not yet due at the balance sheet date.
As at 31 December 2020 and 31 December 2019, no notes receivable were converted into accounts receivable due to
the drawer’s inability to settle the notes on the maturity date.
2. Accounts receivable
The credit period for accounts receivable normally ranges from 0 to 90 days. Accounts receivable are interest-free.
The aging of accounts receivable and the related provision for bad debts are analysed below:
31 December 2020 31 December 2019
Within 1 year 609,575,301.13 571,867,829.15
1 to 2 years 323,044.50 11,250.20
2 to 3 years 11,250.20 -
Less: Provision for bad debts 334,294.70 334,294.70
609,575,301.13 571,544,784.65
364
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
2. Accounts receivable (Continued)
The carrying amount of accounts receivable that affected the changes in provision this year is as follows:
31 December 2020
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which
provision for bad
debts is
recognised
individually 18,549,524.82 3.04% (334,294.70) 1.80% 18,215,230.12
Items for which
provision for bad
debts is
recognised by
group (credit risk
characteristics) 591,360,071.01 96.96% - - 591,360,071.01
609,909,595.83 100.00% (334,294.70) 0.05% 609,575,301.13
31 December 2019
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which
provision for bad
debts is
recognised
individually 10,352,439.53 1.81% (334,294.70) 3.23% 10,018,144.83
Items for which
provision for bad
debts is
recognised by
group (credit risk
characteristics) 561,526,639.82 98.19% - - 561,526,639.82
571,879,079.35 100.00% (334,294.70) 0.06% 571,544,784.65
365
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
2. Accounts receivable (Continued)
As at 31 December 2020, accounts receivable that are individually assessed for provisions are as follows:
Carrying amount Bad debt provision Expected credit Assessment for
loss rate impairment
Receivables from
subsidiaries of the Internal related parties, with
Group 18,215,230.12 - - lower-tier recovery risk.
The debtor had
mismanagement,
subjected to severe
financial difficulties, with
Client A 323,044.50 (323,044.50) 100.00% lower-tier recoverability.
The debtor had
mismanagement,
subjected to severe
financial difficulties, with
Client B 11,250.20 (11,250.20) 100.00% lower-tier recoverability.
18,549,524.82 (334,294.70)
366
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
2. Accounts receivable (Continued)
As at 31 December 2019, accounts receivable that are individually assessed for provisions are as follows:
Expected credit Assessment for
Carrying amount Bad debt provision loss rate impairment
Receivables from
subsidiaries of the Internal related parties, with
Group 10,018,144.83 - - lower-tier recovery risk.
The debtor had
mismanagement,
subjected to severe
financial difficulties, with
Client A 323,044.50 (323,044.50) 100.00% lower-tier recoverability.
The debtor had
mismanagement,
subjected to severe
financial difficulties, with
Client B 11,250.20 (11,250.20) 100.00% lower-tier recoverability.
10,352,439.53 (334,294.70)
367
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
2. Accounts receivable (Continued)
The accounts receivable for which the Company recognised provision for bad debts using the aging analysis method are
presented as follows:
31 December 2020 31 December 2019
Expected credit Expected credit
Estimated Expected loss in entire Estimated Expected loss in entire
default amount credit loss rate lifetime default amount credit loss rate lifetime
Within 1 year 591,360,071.01 - - 561,526,639.82 - -
Changes in provision for bad debts are presented as follows:
Opening balance Increases in the year Written off in the year Closing balance
2020 334,294.70 - - 334,294.70
2019 - 334,294.70 - 334,294.70
The write-off amount of accounts receivable in 2020 was nil (2019: nil).
In 2020, the Company factored a portion of accounts receivable at amortised cost to financial institutions. The amount of
accounts receivable derecognised was RMB220,416,953.64 (2019: RMB463,579,520.41), and the amount of the loss
recognised through investment income was RMB1,796,917.66 (2019: RMB4,379,465.57).
As at 31 December 2020, the top five accounts receivable by customer are as follows:
Bad debt provision % of the total accounts
Amount amount receivable
Top 1 Account receivable 46,764,250.67 - 7.67%
Top 2 Account receivable 37,228,662.30 - 6.10%
Top 3 Account receivable 32,827,136.08 - 5.38%
Top 4 Account receivable 31,808,768.35 - 5.22%
Top 5 Account receivable 24,876,276.35 - 4.08%
173,505,093.75 - 28.45%
As at 31 December 2019, the top five accounts receivable by customer are as follows:
Bad debt provision % of the total accounts
Amount amount receivable
Top 1 Account receivable 27,056,423.78 - 4.73%
Top 2 Account receivable 21,481,852.34 - 3.76%
Top 3 Account receivable 20,318,623.30 - 3.55%
Top 4 Account receivable 18,059,973.06 - 3.16%
Top 5 Account receivable 16,434,645.35 - 2.87%
103,351,517.83 - 18.07%
368
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
3. Receivables financing
31 December 2020 31 December 2019
Bank acceptance bills 30,248,631.32 30,194,682.11
As at 31 December 2020 and 31 December 2019, no receivables financing were pledged.
Receivables financing endorsed or discounted by the Company to other parties which were not yet due at
31 December 2020 and 31 December 2019 is as follows:
31 December 2020 31 December 2019
Derecognised Not Derecognised Not derecognised
derecognised
Bank acceptance bills 46,423,327.83 - 47,476,793.43 -
As at 31 December 2020 and 31 December 2019, no receivables financing were converted into accounts
receivable due to the drawer’s inability to settle the notes on the maturity date.
4. Other receivables
31 December 2020 31 December 2019
Dividend receivable - 834,914.61
Other receivables 3,562,309,346.07 1,928,106,680.77
3,562,309,346.07 1,928,941,595.38
Dividend receivable
31 December 2020 31 December 2019
Shanghai Dingqun - 834,914.61
369
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
4. Other receivables (Continued)
Other receivables
The aging of other receivables is analysed below:
31 December 2020 31 December 2019
Within 1 year 3,561,693,028.43 1,927,753,257.85
1 to 2 years 1,589,947.19 44,499,674.36
2 to 3 years 44,416,956.36 1,177,951.87
Over 3 years 9,980,030.83 9,080,643.69
Less: Provision for bad debts 55,370,616.74 54,404,847.00
3,562,309,346.07 1,928,106,680.77
The other receivables by category are listed below:
31 December 2020 31 December 2019
Amounts due from subsidiaries 3,539,822,609.73 1,913,299,778.33
Receivables from equity transactions 8,980,000.00 8,980,000.00
Deposit 343,834.42 840,318.90
Others 68,533,518.66 59,391,430.54
Less: Provision for bad debts 55,370,616.74 54,404,847.00
3,562,309,346.07 1,928,106,680.77
370
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
4. Other receivables (Continued)
Changes in bad debt provision for the 12-month expected credit losses and lifetime expected
credit losses on other receivables are as follows:
Stage 3
Stage 1 Stage 2
Credit-impaired
12-month Lifetime
financial assets
expected expected
(Lifetime expected
credit losses credit losses Total
credit losses)
- 64,513.65 54,340,333.35 54,404,847.00
Balance at 1 January 2020
- - - -
Balance at 1 January 2020 during the period
- - - -
--Transfer to Stage 2
- - - -
--Transfer to Stage 3
- - - -
--Reverse to Stage 2
- - - -
--Reverse to Stage 1
- 25,474.70 973,888.89 999,363.59
Provisions during the period
- (33,593.85) - (33,593.85)
Reversal during the period
- - - -
Write-back during the period
- - - -
Write-off during the period
- - - -
Other
- - - -
Balance at 31 December 2020 - 56,394.50 55,314,222.24 55,370,616.74
Stage 3
Stage 1 Stage 2
Credit-impaired
12-month Lifetime
financial assets
expected expected
(Lifetime expected
credit losses credit losses Total
credit losses)
Balance at 1 January 2019 - 30,301.58 8,980,000.00 9,010,301.58
Balance at 1 January 2019 during the period - - - -
--Transfer to Stage 2 - - - -
--Transfer to Stage 3 - - - -
--Reverse to Stage 2 - - - -
--Reverse to Stage 1 - - - -
Provisions during the period - 35,375.27 45,360,333.35 45,395,708.62
Reversal during the period - (1,163.20) - (1,163.20)
Write-back during the period - - - -
Write-off during the period - - - -
Other - - - -
Balance at 31 December 2019 - 64,513.65 54,340,333.35 54,404,847.00
371
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
4. Other receivables (Continued)
The bad debt provision amount for other receivables in 2020 was RMB999,363.59 (2019: RMB45,395,708.62),
with the recovered or reversed amount of RMB33,593.85 (2019: RMB1,163.20).
The write-off amount of other receivables in 2020 was nil (2019: nil).
As at 31 December 2020, the accumulated top five other receivables are analysed below:
% of the total
other Bad debt
Nature Amount Aging receivable provision
Sinopharm Guangzhou Entrusted loans 1,581,943,383.47 Within 1 year 43.73% -
Sinopharm Guangxi Entrusted loans 627,704,462.92 Within 1 year 17.35% -
Sinopharm Dongguan Entrusted loans 161,185,177.07 Within 1 year 4.46% -
Sinopharm Yuexing Entrusted loans 143,816,758.49 Within 1 year 3.98% -
Sinopharm Zhanjiang Entrusted loans 117,129,057.54 Within 1 year 3.24% -
2,631,778,839.49 72.76% -
As at 31 December 2019, the accumulated top five other receivables are analysed below:
% of the total
other Bad debt
Nature Amount Aging receivables provision
Sinopharm Guangzhou Entrusted loans 450,000,000.00 Within 1 year 22.70% -
Sinopharm Guangxi Entrusted loans 356,000,000.00 Within 1 year 17.96% -
Sinopharm Dongguan Entrusted loans 161,000,000.00 Within 1 year 8.12% -
Sinopharm Zhangjiang Entrusted loans 117,000,000.00 Within 1 year 5.90% -
Sinopharm Meizhou Entrusted loans 76,700,000.00 Within 1 year 3.87% -
1,160,700,000.00 58.55% -
5. Long-term equity investments
31 December 2020 31 December 2019
Investments in subsidiaries (1) 5,614,677,427.58 5,614,677,427.58
Investments in associates (2) 2,298,920,817.58 2,124,009,098.25
7,913,598,245.16 7,738,686,525.83
Less: Provision for impairment of
long-term equity investments 39,930,000.00 39,930,000.00
7,873,668,245.16 7,698,756,525.83
372
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
5. Long-term equity investments (Continued)
(1) Subsidiaries
Increases
Original investment /(decrease) Equity interest held Voting rights held
cost 1 January 2020 in investment cost 31 December 2020 (%) (%)
Sinopharm Jianmin 45,054,911.04 60,054,911.04 - 60,054,911.04 100.00 100.00
Sinopharm Shenzhen
Material 5,400,000.00 15,450,875.93 - 15,450,875.93 100.00 100.00
Shenzhen Logistics 900,000.00 5,019,062.68 - 5,019,062.68 100.00 100.00
Sinopharm Guangzhou 58,283,114.68 3,588,689,716.80 - 3,588,689,716.80 100.00 100.00
Sinopharm Guangxi 33,048,985.28 525,456,951.07 - 525,456,951.07 100.00 100.00
Sinopharm Yanfeng 38,207,800.00 38,207,800.00 - 38,207,800.00 51.00 51.00
Guoda Drugstore 1,361,800,110.06 1,361,800,110.06 - 1,361,800,110.06 60.00 60.00
Sinopharm Accord
Medical Supply Chain
(Shenzhen) Co., Ltd. 19,998,000.00 19,998,000.00 - 19,998,000.00 60.00 60.00
5,614,677,427.58 - 5,614,677,427.58
(2) Associates
Changes in the year
At beginning of the Investment Profit or loss Other Other changes Cash dividend At end of the year Amount of
year under the equity comprehensive in equity or profits declared (Book value) provision for
(Carrying amount) method income impairment
Main Luck
Pharmaceutical 294,469,367.27 - 91,569,378.60 - - (63,342,000.00) 322,696,745.87 -
Zhijun Suzhou 39,930,000.00 - - - - - - (39,930,000.00)
Zhijun Medicine 400,578,574.68 - 78,197,322.08 - - (53,218,071.65) 425,557,825.11 -
Zhijun Trade 10,275,257.61 - 1,176,564.36 - - (1,043,146.79) 10,408,675.18 -
Zhijun Pingshan 120,878,018.74 - 76,785,503.04 - - (21,096,725.88) 176,566,795.90 -
Shyndec Pharma 1,235,240,098.79 - 105,623,439.79 5,332.87 (393,875.73) (16,714,220.20) 1,323,760,775.52 -
Shanghai
Dingqun 22,637,781.16 (22,637,781.16) - - - - - -
2,124,009,098.25 (22,637,781.16) 353,352,207.87 5,332.87 (393,875.73) (155,414,164.52) 2,258,990,817.58 (39,930,000.00)
373
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
6. Operating revenue and cost
2020 2019
Revenue Cost Revenue Cost
Principal operations 3,804,104,902.73 3,653,114,484.10 4,084,112,471.45 3,901,326,725.78
Other operations 49,554,098.39 21,758,477.24 24,286,547.89 14,708,846.74
3,853,659,001.12 3,674,872,961.34 4,108,399,019.34 3,916,035,572.52
Revenue is as follows:
2020 2019
Revenue from contracts with customers 3,844,963,018.49 4,098,679,263.40
Rentals 8,695,982.63 9,719,755.94
3,853,659,001.12 4,108,399,019.34
Disaggregation of revenue from contracts with customers is as follows:
2020 2019
Place of business
China 3,844,963,018.49 4,098,679,263.40
Types of major activities
Pharmaceutical distribution 3,804,104,902.73 4,084,112,471.45
Others 40,858,115.76 14,566,791.95
3,844,963,018.49 4,098,679,263.40
Types of major goods
Pharmaceuticals 3,539,964,107.30 3,936,812,220.01
Medical devices and disposables 254,850,921.90 129,344,291.79
Diagnostic reagents 9,285,448.75 17,704,322.48
Medical equipment 4,424.78 251,637.17
Others 40,858,115.76 14,566,791.95
3,844,963,018.49 4,098,679,263.40
Timing of revenue recognition
At a point in time
Sale of goods 3,804,104,902.73 4,084,112,471.45
Over time
Providing services 40,858,115.76 14,566,791.95
3,844,963,018.49 4,098,679,263.40
374
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
XIV Notes to key items of the company financial statements (Continued)
6. Operating revenue and cost (Continued)
Revenue recognised that was included in contract liabilities at the beginning of the year is as
follows:
2020 2019
Sale of goods 7,293,184.46 4,182,083.40
The Company has recognised contract liabilities in total of RMB1,807,562.61 through the sale of
goods and provision of services in the current year. The expected revenue recognition time for
the Company’s contract obligations above is in year 2021.
Information about the Company’s performance obligations is summarised below:
(1) Revenue is recognised when control of the goods has transferred, and payment is generally
due within 30 to 210 days from delivery;
(2) Revenue is recognised in the service duration and the payment is generally due within 30 to
210 days since the service is completed.
7. Investment income
2020 2019
Gain on long-term equity investments under
the cost method 612,502,685.91 809,260,600.24
Gain on long-term equity investments under
the equity method 353,352,207.87 353,856,432.16
Dividends from other financial assets 4,109,881.90 -
Income from the derecognition of financial
assets measured at amortised cost (1,796,917.66) (4,379,465.57)
Others 998,665.84 -
969,166,523.86 1,158,737,566.83
375
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS
Year ended 31 December 2020 Expressed in Renminbi Yuan
Supplementary information to financial statements
1. Schedule of non-recurring profit or loss
Amount for 2020
Gains and losses on disposal of non-current assets,
including write-off of an accrued asset impairment 5,969,522.10
Government grants recognised in the income statement for the current year, except for those
closely related to the ordinary operation of the Company which the Group enjoyed
constantly according to the allotment standards or quantitative criteria of the country 65,568,137.35
The investment cost of an enterprise to acquire a subsidiary, an associate and a joint venture,
which is less than profits derived from the fair value of the identifiable net assets of the
invested unit when investing 70.96
Reversal of bad debt provision for accounts receivable that were tested for
impairment individually 578,362.65
Custody fee income from entrusted operations 961,488.75
Non-operating income and expenses other than the aforesaid items (11,819,894.60)
Other 3,835,445.51
65,093,132.72
Impact on income tax (16,223,813.42)
Impact on non-controlling interests after tax (16,628,761.57)
32,240,557.73
The Group's recognition of non-recurring profit or loss items is in accordance with the provisions of
Explanatory announcement No.1 on information disclosure by companies offering securities to the
public - non-recurring profit or loss (CSRC Announcement [2008] No.43).
376
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2020 Expressed in Renminbi Yuan
Supplementary information to financial statements (Continued)
2. Return on equity (“ROE”) and earnings per share (“EPS”)
2020
Weighted Basic EPS (1)
average ROE
(%)
Net profit attributable to the ordinary shareholders of the parent 10.49 3.27
Net profit after deducting non-recurring profit or loss attributable to
the ordinary shareholders of the parent 10.25 3.20
2019
Weighted Basic EPS (1)
average ROE
(%)
Net profit attributable to the ordinary shareholders of the parent 10.31 2.96
Net profit after deducting non-recurring profit or loss attributable to
the ordinary shareholders of the parent 10.06 2.87
The above-mentioned return on net assets and earnings per share was calculated according to the
Information Disclosure and Presentation Rules for Companies Making Public Offering of Securities
No.9 – Calculation and Disclosure of Return on Net Assets and Earnings Per Share (revision 2010)
issued by CSRC.
(1) There were no potential dilutive ordinary shares for year 2020 (2019: nil), and hence, no
presentation of diluted EPS was provided.
377
Section XIII. Documents Available for Reference
1. Accounting Statements carried with the signature and seals of legal representative, chief financial officer and
person in charge of accounting;
2. The original audit report bearing the seal of accounting firm and the original audit report signed and seal by the
CPA;
3. Original text of all documents of the Company as well as manuscript of the announcement disclosed in
reporting period on Securities Times, China Securities Journal and Hong Kong Commercial Daily appointed by
the CSRC;
4. Text of the Annual Report bearing the signature of the legal representative;
5. Where documents are placed: Office of Secretariat of the Board of Directors, Accord Pharm Bldg., No. 15, Ba
Gua Si Road, Futian District, Shenzhen
China National Accord Medicines Corporation Ltd.
Legal Representative: Lin Zhaoxiong
2 April 2021
378
