China National Accord Medicines Corporation Ltd.
Annual Report 2021
March 2022
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 2021 Annual
Report is authentic, accurate and complete.
All directors are attended the Board Meeting for report deliberation.
The profit distribution plan that deliberated and approved by the Board is:
based on total stock issued 428,126,983 shares, distributed 6.00Yuan (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.
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Contents
Sction I Important Notice, Contents and Interpretation................................................................1
Section II Company Profile and Main Financial Indexes...............................................................5
Section III Management Discussion and Analysis.........................................................................10
Section IV Corporate Governance..................................................................错误！未定义书签。
Section V Enviornmental and Social Responsibility..................................... 错误！未定义书签。
Section VI Important Events ..........................................................................................................83
Section VII Changes in shares and particular about shareholders........... 错误！未定义书签。9
Section VIII Preferred Stock.........................................................................错误！未定义书签。9
Section IX Bonds............................................................................................ 错误！未定义书签。0
Section X Financial Report............................................................................错误！未定义书签。1
2
Documents Available for Reference
I.The financial statements carried with the signature and seals of the person in charge of the
Company, person in charger of accounting works and person in charge of accounting
organ(accounting supervisor);
II.The original audit report bearing the seal of accounting firm and the original audit report
signed and seal by the CPA;
III.Original text of all documents of the Company as well as the manuscript of the
announcement disclosed on the website designated by CSRC.
3
Interpretation
Items Refers to Contents
Listed Company, Company, the Company,
Refers to China National Accord Medicines Corporation Ltd.
Sinopharm Accord, the Group
SINOPHARM Refers to China National Pharmaceutical Group Corporation
Sinopharm Holding Refers to Sinopharm Group Co., Ltd, Controlling shareholder of the 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 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.
Zhijun Pingshan Refers to China National Zhijun (Shenzhen) Pingshan Pharmaceutical Co., Ltd.
Main Luck Pharmaceuticals Refers to Shenzhen Main Luck Pharmaceuticals Inc.
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Section II Company Profile and Main Financial Indexes
I. Company information
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
Historical changes in the
No changes
registration address
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 25875222 +(86)755 25875222
Fax. +(86)755 25195435 +(86)755 25195435
E-mail gyyzinvestor@sinopharm.com gyyz0028@sinopharm.com
III. Information disclosure and preparation place
Website of the Stock Exchange where the annual
Securities Times, China Securities Journal, Hong Kong Commercial Daily
report of the Company disclosed
Media and Website where the annual report of the http://www.szse.cn ; http://www.cninfo.com.cn
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Company disclosed
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 Deng Dongmei, 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
Changes in the current
2021 2020 year over the previous 2019
year (+,-)
Operating revenue (RMB) 68,357,809,571.99 59,649,455,012.03 14.60% 52,786,807,476.28
Net profit attributable to
shareholders of the listed Company 1,336,427,752.22 1,401,892,593.23 -4.67% 1,267,931,291.32
(RMB)(Note 1)
Net profit attributable to
shareholders of the listed Company
1,286,305,975.28 1,369,652,035.50 -6.09% 1,226,765,271.97
after deducting non-recurring gains
and losses (RMB)
Net cash flow arising from
1,655,180,976.87 1,502,746,598.47 10.14% 2,012,653,189.74
operating activities (RMB)
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Basic earnings per share
3.12 3.27 -4.59% 2.96
(RMB/Share) (Note 1)
Diluted earnings per share
3.12 3.27 -4.59% 2.96
(RMB/Share)
Weighted average ROE 1.20 percentage points
9.29% 10.49% 10.31%
(Note 1) down
Changes at end of the
current year compared
Year-end of 2021 Year-end of 2020 Year-end of 2019
with the end of
previous year (+,-)
Total assets (RMB) 42,783,682,431.81 39,594,533,471.65 8.05% 34,028,843,214.20
Net assets attributable to
shareholder of listed company 14,924,938,052.50 13,948,322,652.33 7.00% 12,911,140,435.88
(RMB)
Note 1: Net profit attributable to shareholders of the listed Company has 4.67% declined from a year earlier, basic EPS drop 4.59%
correspondingly, weighted average ROE decreased by 1.20 percentage points, mainly because according to the results of impairment
tests on goodwill and intangible assets for the year, follow the principle of prudence, the goodwill and intangible assets (brand rights
and sales network) from subordinate subsidiary- Shanghai Dingqun Enterprise Management Consulting Co., Ltd (and the Sinopharm
Holding Tianhe Pharmaceutical Co., Ltd) are being accrued by the Company, found more in Notice on Assets Impairment Provision
by China National Accord Medicines Corporation Ltd. (Notice No.: 2022-03). Meanwhile, there are 1155 new director-operated
stores opened in 2021 in the retail sector, with the large initial investment and non benefits generated temporary and multiple
influences as industry policies and epidemic, the profit space shrinks.
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
□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
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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 16,049,966,325.75 17,113,125,561.64 17,046,925,131.18 18,147,792,553.42
Net profit attributable to
328,800,560.24 412,644,453.01 332,710,261.54 262,272,477.43
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
321,593,612.98 399,360,795.24 323,929,049.31 241,422,517.75
after deducting non-recurring gains
and losses
Net cash flow arising from
-306,748,999.24 1,536,122,282.81 190,693,254.22 235,114,439.08
operating activities
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in the company’s quarterly report and semi-annual report
□ Yes √ No
IX. Items and amounts of extraordinary profit (gains)/loss
√Applicable □ Not applicable
In RMB
Item 2021 2020 2019 Note
Gains/losses from the disposal of non-current The gains on disposal of
asset (including the write-off that accrued for 2,819,900.34 5,969,522.10 2,340,925.97 right-to-use asses arising
impairment of assets) from off-lease in the period
Governmental subsidy reckoned into current Mainly for receiving of all
75,900,940.54 65,568,137.35 49,299,242.48
gains/losses (while closely related with the kinds of special subsidies
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normal business of the Company, the etc. in the period
government subsidy that accord with the
provision of national policies and are
continuously enjoyed in line with a certain
standard quota or quantity are excluded)
Investment costs while acquiring
subsidiaries, joint ventures and associated
Negative goodwill from
enterprise, less than fair value of the 219,279.00 70.96 14.65
subsidiary acquisition.
identifiable net assets from invested
enterprise which should be enjoined
Current net gain/losses of the subsidiary
merger under the same control from -4,059,241.89
beginning of the period to combination date
Switch back of provision for depreciation of
account receivable that individually tested 1,491,750.76 578,362.65 1,310,345.38
for impairment
Gains and losses from external entrusted
3,460,037.16
loans
Consigning fee received for consigned
961,488.75
operation
The non-operating income
Other non-operating income and expenditure arising from the written off
20,642,938.09 -11,819,894.60 17,179,002.78
except for the aforementioned items amount that does not need
to be paid during the period
Other gains/losses satisfy a definition of
3,891,236.81 3,835,445.51 508,168.93
extraordinary gains/losses
Less: Impact on income tax 24,001,469.59 16,223,813.42 17,317,723.70
Impact on minority shareholders’ equity
30,842,799.01 16,628,761.57 11,554,752.41
(post-tax)
Total 50,121,776.94 32,240,557.73 41,166,019.35 --
Details of other gains/losses satisfy a definition of extraordinary gains/losses :
□ Applicable √ Not applicable
There are no other gains/losses items that satisfy the definition of extraordinary gains/losses in the Company.
Explain the items defined as extraordinary 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
□ Applicable √ Not applicable
There are no items defined as extraordinary 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 Management Discussion and Analysis
I. Industry the Company operates during the reporting period
The Company shall comply with the relevant disclosure requirement for retailing industries of Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No.3 - Disclosure of Industry Information
(1) Macro environment of the industry
2021 is the first year of China’s 14th Five-Year Plan, macro environment continues to changes.Under the
epidemic background, China’s economy continues to recover with steady growth in GDP and high-quality in
development; with frequently introduction of the medical reform policy, the country’s implementation of
Healthy China Strategy has promoted the balanced distribution of high-quality medical resources; The
aggravating trend of aging population and universal three-child policy made the market demand of health
industry, sanatoria service industry combining medical care & health care and pediatric drugs getting higher.
With the release of Outline Development Plan for the Guangdong-Hong Kong- Macao Greater Bay Area
and introduction of several polices, the construction of Greater Bay Area in terms of health care earns a new
profit.
(2) Basic information, development stages and periodic features of the industry
In 2021, the pharmaceutical industry embrace greater challenges and opportunities due to the continues soaring of
pharmaceutical market, sustainable deepening of medical insurance, hospital and drug industry co-reformation
and intensive introduction of medical industry.
1. Development of pharmaceutical terminal market
In 2021, terminal market of the pharmaceutical starting warming up. However, affected by the numerous
spread of epidemic and acceleration of the centralized procurement, development of pharmaceutical terminal
market continues to be under pressure.
According to the statistics of the PDB (data released by PHIIC) domestic sample hospitals market, the
market size of sample hospitals in the first three quarters of 2021 rebounded by 10.24% compared to the
same period of 2020. However, due to the lower base number in 2020 and affected by factors as epidemic
and centralized procurement, the growth of hospital market month-on-month continues to slow down.
The third quarter of 2021 only has 1.86% up from the second quarter, the sales from hospital market in the
whole year of 2021 have a certain gap with that of 2019.
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According to the drug retails from China Monitor Health(CMH), sales volume of the retail pharmacies
increased by 3.0% nationwide in the first three quarters of 2021. In the second half of the year, under the
influence of recurrence of epidemic in local areas of the country, the epidemic prevention & control
measures of retail pharmacies in some areas are becoming stricter. Ban on the sale of epidemic drugs and
affected by the centralized procurement of medical institutions, some patients returned to the hospitals and
primary medical institutions, the customer flow from retail pharmacies has been challenged with just 0.3%
up month-to-month in the third quarter.
2. Pharmaceutical industry polices and influences
The medical industry polices intensively introduced, and co-reformation of medical insurance, hospital and
drug industry are continued deepening in 2021. In terms of medicine, mainly involves the policies as drug
registration & approval, bulk drugs, drug patent, drug vigilance, TCM and formula granule development; In
terms of medical insurance, policies as volume-based procurement, adjustment & negotiation of medical
insurance catalogue, medical insurance “dual channel”, DRG/DIP payment and medical insurance for urban
& rural residents are included; and in terms of medical treatment, mainly includes long-term prescriptions,
reforms at public hospitals, hierarchical medical, reformation of medical health care services and experience
of Sanming’s medical reformation in promoting.
(1) Normalization & institutionalization of volume-based procurement and gradual expansion of coverage have a
great impact on pharmaceutical industry
Six batches of centralized procurement for drugs are organized by the state, 234 kinds of drugs procured in total,
and the market amount accounts for around 30% of the chemical and biological drugs procured by public medical
institutions. Special procurement of insulin was carried out in 2021, expanding the centralized procurement from
chemical drugs to biological drugs for the first time. Centralized procurement of high-value medical consumables
are focus on cardiology and orthopedics, the two most concerned areas to the general public. The concentrated
purchase of heart stent has been running for a year smoothly, and 1.69 million selected stents being used, nearly
1.6 times of the annual agreed procurement quantity. In 2021, the concentrated purchase of joint prosthesis are
organized by the state against orthopedic consumables which is more complicate to further expand the coverage of
reforms.
Impact of volume-based procurement on pharmaceutical business: squeezed sales revenue and gross margin
have a great impact on the revenue growth and profit space of the commercial enterprises; soaring
distribution costs, higher demanding of delivery frequency for centralized procurement varieties, especially
the primary care institutions newly operates, the single purchasing quantity is small and frequency of
delivery is high, which increases the distribution costs significantly; the distance had been enlarged between
medical commercial enterprises, and the increment of centralized procurement varieties brings challenges
and opportunities to the commercial enterprises: due to the factors as scaling, collectivization,
informatizaion and capital chain, the puny commercial enterprises have been unable to sustain and undertake
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the burden of volume-based procurement; Instead, the large pharmaceutical commercial enterprises owns
numerous variety of reserves, abundance in capital, fast delivery capability and wide range of hospital
accounts, which provides convenient conditions for enterprises. Although the overall gross profit from
distribution decreased, the industry status will be further consolidated as part of the costs digested by size
effect of volume-based procurement.
Impact of volume-based procurement on pharmacy retail:Wining varieties are selected by cutting prices, and
the prices hang upside down among varieties operated in drug store, facing pressure to reduce the prices.
even though participate in centralized procurement and solve the channel problems, we still facing price
pressure; monomer pharmacies have lost the competitive advantages under the trend of centralized
procurement when the speed of mergers & acquisition accelerated, the rate of chain for drug stores improve
one more step as the acceleration of pharmacy mergers & acquisition; speeding up the online layout and
reducing the drug prices, the drug store gradually develops online business as the operation costs goes up.
(2) Promoting establishment of hierarchic care and medical partnerships, the grassroots market is gradually being
opened up
On November 4, 2021, the National Health Commission printed and issued the 1,000 Counties Projects -
Work Plan of the Comprehensive Capacity Improvement for County-level Hospitals (2021-2025) , to meet
the needs of peoples in county ares for medical services as the starting point, consolidated and expended the
effective connection between the achievements in poverty alleviation and rural revitalization, speeding up
and improve the hierarchic care system, promoting the county-level hospitals to a high-quality development
stage. And strive for 5 years of hard working, 1000 county-level hospitals at least across the country have
reached the medical service standard of third-class hospitals, laying a solid foundation for achieving the
solution of general diseases in cities and counties.
On 22 November 2021, the general office of National Health Commission printed and issued the Notice on
Promotion of Sanming’s Experience in Hierarchic Medical and Establishment of Medical Partnership, it is
proposed to build a hierarchic medical pattern with primary diagnosis construction, two-way referral and
upper & lower linkage, focus on promoting high-quality development of public hospitals, and advancing 8
key tasks of hierarchic medical and construction of medical partnership.
The hierarchic medical and construction of medical partnership will force the hospital joint procurement and
medical insurance - priced to the ground. Firstly, unify the catalog. The minimum threshold for drugs in catalog
will be price; expending the promotion areas, once in the procurement catalog, it means the products have access
to multiple hospitals within the medical partnership, the huge-crowd strategy in the past that running to the
hospital for drugs is expected to reduce costs. Secondly, unify the distribution. The initiative of medical
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institutions to upstream distribution business and pharmaceutical enterprises has been improved greatly, whether
second bargaining or distribution, payment collection, the trend of medical institution suppress upper-and-
midstream industry & commerce is harder to reverse. Finally, volume-based procurement. Quantity and pricing
connected and reducing price by quantity, on the basis of centralized procurement, every single medical
partnership further bargaining on volume-based pricing with a second bargaining resulted.
(3) The “dual channel” help the implementation of medicines with negotiated prices and beneficial to the retail
business development
The dual channel policy accelerated the prescription circulation and separation of dispensing from
prescription (SDP), some of the function of original in-hospital management of drugs are transferring to the
outside of the hospital, to ensure equal rules of payment by medical insurance for compliant institutions
both in and out of the hospital; relevant national meeting also indicated that the supervision for medical
insurance fund will be strengthened by enhancing the prescription circulation center as the core. In the future,
under the background of policy guidance, compliance and increasing requirements for professionalism, the
competitiveness of pharmaceutical leading enterprises will be enhanced and the industry concentration will
further improved.
II.Main business of the Company during the reporting period
The Company shall comply with the relevant disclosure requirement for retailing industries of Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No.3 - Disclosure of Industry Information
(i) Main business of the Company includes pharmaceutical distribution and pharmaceutical retail,
specifically as follows:
1.In the field of pharmaceutical distribution, the Company mainly based in Guangdong & Guangxi, leading
in the scale of pharmaceutical distribution in the two regions.
As of 31 December 2021, there were 1,092 secondary & tertiary medical institutions; 7,870 grass-roots medical
clients and 6,414 retail terminal customers (chain pharmacies, single stores, and self-pay pharmacy in hospitals).
In terms of distribution, 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. Through
continuous integration of distribution and logistics, deep penetration into the terminal market and improving the
stepwise distribution network. To build an intelligent supply chain, committed to become the pharmaceutical and
health products & service provider with the most influential, the highest shares, the most comprehensive variety,
the best service and the fastest distribution in South China.
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2. In the pharmaceutical retail field, Guoda Drugstore is a leading pharmaceutical retailer in sales scale
throughout the country
By the end of 2021, Guoda Drugstore has operated 8,798 stores, covering 20 provinces, autonomous regions and
municipalities, 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 22 billions, maintain the leading sales within industry; Guoda drugstore, the business of which were
mainly relying on social retail drugstores, has been putting great attention 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) Business models
1.Business of distribution
(1)Procurement model
In terms of procurement, the company has established a procurement mechanism of "front end -- back end"
division of labor and cooperation, which effectively reduces the procurement cost. The "front end" is the
purchasing department, which, according to business needs, looks for supply of goods, establishes first-run
varieties, compares prices and conducts business negotiations on product quality requirements, lead time, supply
price and payment terms, in addition, effectively manages suppliers, including supplier qualification, service
quality, integrity degree, etc., establishes supplier files, and organizes supplier evaluations. The "back end" is the
supply chain department, which is responsible for integrating supply chain resources, grasping supply chain
information as a whole, realizing professional division of labor, promoting integrated management, creating
integrated service background, assisting the "front end" business, and completing daily purchase contracts and
orders.
(2) Sales model
In terms of sales model, the company has carried out transformation and innovation according to the "one body
and two wings" strategy of distribution sector.
For traditional business, the distribution implements the business model of "network submersion" in southern
China, and is the main channel supplier of drugs in Guangdong and Guangxi, and has achieved full coverage of
the national pharmaceutical market. At the same time, we will build special businesses such as equipment,
medical beauty, medical care and health, TCM decoction pieces and import, and vigorously expand the end
markets such as basic-level medical institutions and private hospitals to improve product supply guarantee and
basic-level network coverage capability.
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The retail direct selling business undertakes the company’s "integration of wholesale and retail" strategy,
promotes the national retail terminal layout, and deeply develops in southern China and radiated across the
country based on the national top one hundred + professional DTP drugstores, project centralized procurement,
the third terminal agents and other distribution networks;
At the same time, the company provides customers with one-stop overall solutions and diversified value-added
services and innovative services; 1) Promote the implementation of medical service innovation model through
hospital supply chain project, equipment SPD, regional distribution, regional medical services (inspection,
disinfection), and outsourcing and acceptance of prescriptions prescription dispensing and undertaking, etc.. The
subsidiaries Sinopharm Holding Guangzhou Medical Technology Co., Ltd., Sinopharm Holding Guangzhou
Medical Management Co., Ltd., and Sinopharm Holding Guangzhou Medical Supply Chain Service Co., Ltd.
have carried out effective business expansion and practice on professional service products such as medical
equipment life cycle management, reagent consumables and disinfection business. 2) In terms of third-party
logistics business, we undertake the warehousing, distribution and other value-added services for third-party
customers such as pharmaceutical equipment manufacturers, pharmaceutical equipment business, centers for
disease control, vaccine manufacturers, etc., and provide professional third-party logistics solutions for integrated
businesses such as third-party bonded logistics to national warehousing, distribution and logistics services.
(3) Logistics and distribution model
After long-term development and accumulation, the logistics center has established a complete modern
pharmaceutical logistics service system, and integrated warehousing and distribution and intelligent supply chain
service abilities. The logistics center has more than 180,000 square meters of warehouse space and more than 260
self-operated transport vehicles in Guangdong and Guangxi. The served customers include upstream and
downstream clients of distribution and operation headquarters, third-party logistics customers include innovative
pharmaceutical companies, disease control customers, pharmaceutical equipment manufacturers and commercial
companies, vaccine manufacturers, etc. The distribution scope covers the whole country. Distribution terminals
include direct selling customers of hospitals, basic-level medical customers, small social medical customers,
commercial customers, retail direct selling customers, centers for disease control, individuals, etc. Relying on the
national logistics resources of Sinopharm Holding and combined with the resources of carriers, the logistics center
has achieved full coverage of national urban and rural medical logistics. The company's logistics products mainly
include warehousing inspection services, storage services, delivery services, insurance and supply chain
optimization and other value-added services; as well as delivery services in medial transportation cities, special
car services for medicines, medial express delivery services, supply chain optimization and other value-added
services.
2. Retail business
(1) Procurement model
The procurement model of Guoda Drugstore is divided into centralized procurement and local procurement. The
procurement model of centralized procurement can be divided into unified signing separate purchasing and
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unified signing unified purchasing. For unified signing separate purchasing, the headquarters uniformly signs
tripartite contract (headquarters, regional company and supplier), and the regional company directly purchases
from supplier. For unified signing unified purchasing, the headquarters and supplier sign the contracts, the
headquarters centralizedly gathers the goods and then distributes to regional company for sales. The procurement
model of local procurement is that the regional company directly signs contracts with supplier, and purchases and
sells by itself. In 2021, the sales of centralized procurement accounted for 44%, while the sales of local
procurement accounted for 56%.
(2) Sales model
The retail business of Guoda Drugstore is mainly carried out in the form of chain operation, including company-
owned stores and franchised stores. By The end of December 2021, there were 8,798 store in total, including
7,257 directly owned stores, 1,541 franchised stores, covering 20 provincial-level markets; the main business is
Chinese patent drugs and generic medicines, traditional Chinese medicine decoction pieces, medical equipment,
health food, healthy food and supplies, etc.. In terms of business model, it actively promotes online to offline
Internet + medicine, and explores "5+X" retail and diagnosis and treatment innovative stores combining
traditional Chinese medicine, Western medicine, rehabilitation and physiotherapy services. At the same time, it
continuously optimizes the slow disease diagnosis and treatment and member management new model, now there
are nearly 24 million active members, establishes health records for customers with chronic disease, follow up and
pay close attention in a long term, and cooperates with top ranked suppliers at home and abroad, constantly
enhances professional pharmaceutical affairs service ability, provide quality health products and services for the
majority of the people, and fulfills the social responsibility of a state-owned enterprise.
(3) Logistics and distribution model
The logistics and warehousing management model of the headquarters and subsidiaries of Guoda Drugstore has
two main types, the first is self-operated logistics model, namely the subsidiaries rent warehouses for the
warehousing and distribution services of stores and external customers, the second is the model to entrust state
control system for logistics distribution, namely the subsidiaries entrust the local state control system for storage
and transportation based on factors such as cost or resource sharing. At present, entrusted distribution accounts for
27%. There are three modes of transportation, i.e. self-operated distribution, entrusting a third party for
transportation, and mixed transportation management - self-operated + entrusted mode.
(iii) The company's 2021 annual performance and main work
The year 2021 was a significant moment of the hundredth anniversary of the communist party of China and a key
node in the history intersection of the "two one hundred years", pandemic prevention and control and socio-
economic development were under pressure at home, Sinopharm Accord adhered to Xi Jinping Thought on
Socialism with Chinese Characteristics for a New Era, thoroughly implemented the spirits of the the 19th National
Congress of the CPC and all the previous plenary sessions of the 19th Central Committee of the C.P.C., fully
implemented the general requirements of party building and the party’s organizational principle in the new era,
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earnestly implemented the deployment requirements of SINOPHARM and Sinopharm Holding, focused on the
strategic policy of "technology energized, service upgrade, wholesale and retail integration, and industry - finance
dual drive", and continued to promote the "14th Five-Year" strategic planning of Sinopharm Accord's "1-2-6", i.e.
one core dual networks and six platforms. Under the annual working idea of "building a new development pattern
and sustaining high-quality development", 40,000 employees of Sinopharm Accord made concerted efforts and
achieved the goal of opening a new situation, responding to the changing situation and stabilizing the overall
situation at the first year of the "14th Five-year Plan".
Operation in 2021
In the year of 2021, under the influence of COVID-19 and policies as centralized procurement of drugs, in the
face of pressure, multiple measures were taken by Sinopharm Accord to star the year with vigor. Cumulative
operation revenue reached 68,358 million yuan for the year, a 14.60% increased on a y-o-y basis; operation profit
has 1,952 million yuan, declined by 9.77% from a year earlier and the net profit attributable to shareholder of
listed company amounted to 1336 million yuan with 4.67% down on a y-o-y basis. The main reason for declined
in profit is according to the results of impairment tests on goodwill and intangible assets for the year, follow the
principle of prudence, the goodwill and intangible assets (brand rights and sales network) from subordinate
subsidiary- Shanghai Dingqun Enterprise Management Consulting Co., Ltd (and the Sinopharm Holding Tianhe
Pharmaceutical Co., Ltd) are being accrued by the Company. Meanwhile, there are 1155 new director-operated
stores opened in 2021 in the retail sector, with the large initial investment and non benefits generated temporary
and multiple influences as industry policies and epidemic, the profit space shrinks.
In 2021, Sinopharm Accord achieved a total operating revenue of 46,833 million yuan in distribution business, a
y-o-y increase of 14.03%; net profit achieved 947 million yuan, a y-o-y growth of 10.74%, of which: revenue
from traditional medical direct-sales of 31,900 million yuan, a y-o-y increase of 15%; retail direct sales revenue of
6,200 million yuan, 1% up from a year earlier; retail diagnosis and treatment revenue of 2,000 million yuan, 19%
up on a y-o-y basis and commercial distribution revenue of 5,200 million yuan, 19% growth on a y-o-y basis.
In 2021, Guoda Drugstore completed an operating revenue of 22,478 million yuan in total, a y-o-y growth of
15.64%, the net profit amounted as184 million yuan, 61.38% down from a year earlier. The net profit attributable
to parent company was 65 million yuan, a y-o-y decline of 80.88%, of which: retail (direct operation stores and
franchised stores included) revenue of 17,990 million yuan, 16.3% up from a year earlier; revenue from terminal
distribution of 4,100 million yuan, a y-o-y increase of 15%.
The accumulative investment income from associates was 333 million yuan for the year of 2021, a y-o-y decrease
of 5.91%.
1. Central enterprise takes the responsibility to fight against the epidemic
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As of December 2021, subsidiaries of Sinopharm Accord have obtained 67 (including 2 central medical reserve
qualifications; 12 provincial & municipal -level qualifications; 25 reserves of direct fund allocation from central;
28 qualifications for government epidemic prevention & control and special procurement) qualifications for
medicine and anti-epidemic supplies reserves, and completed emergency distribution of supplies to many
epidemic areas in Guangdong and Guangxi successively.
Undertaking the warehousing & distribution operation for disease control & prevention vaccine in vary areas
within the Guangdong and Guangxi, setting up a special command group/operation team for vaccines with rapid
response on duty 24 hours a day. Nearly 2,000 square meters of cold storage has been contributed and 120
refrigerated trucks on duty, undertaking 60% of the warehousing & distribution services for COVID-19 in
Guangdong Province, 40 disease control centers have been contracted and covering 1,700 vaccination sites
approximately. The Company assisted in the delivery of more than 3.4 million doses of COVID-19 vaccines in
Guangxi Province and covering more than 130 vaccination sites.
In the closed environment of the pandemic outbreak quarantine zone, Guoda Drugstore and the distribution
professional pharmacies, Sinopharm Accord’s subordinates, provided emergency medicine services, responded to
pandemic prevention and control requirements of the local government, launched online emergency mode of
"enterprise WeChat group customer service guide + store order receiving, logistics special vehicle distribution",
opened normally, and provided professional consultation and delivery services for patients with chronic diseases
in the quarantine areas. We assisted hospitals in opening Internet prescription circulation channels to meet the
needs of patients in quarantine areas for online further consultation and drug use. A number of subsidiaries of the
company have won anti-epidemic awards from the government and industry associations. The meritorious deeds
of the company in fighting against COVID-19 pandemic have been included in the briefing on study and
education of party history carried out by the state-owned assets system of Guangdong Province and in the
Guangdong Youth League News of the Guangdong Communist Youth League.
2. Distribution business of Sinopharm Accord: consolidated traditional business, developed innovative business,
and constantly improved market competitiveness
(1) Traditional business:
The traditional business further stimulated vitality, became stronger and bigger, and led the industry. The
distribution business of Sinopharm Accord has actively seized the opportunity of the centralized procurement
policy and fully obtained the distribution rights of the centralized procurement varieties, and the annual
distribution rate of all national and provincial centralized procurement points in Guangdong and Guangxi
exceeded 95%, and the point distribution rate ranked at the top. At the same time, we actively seized the dual-
channel market opportunity and strived for the right to distribute dual-channel products. The entrusted distribution
rate of products exceeded 80%. The linkage of purchase and sales accelerated the ice breaking of upstream and
downstream, and the market share continued to increase; promoted marketing transformation, built a professional
marketing team in the field of tumours and chronic diseases, and carried out in-depth CSO cooperation model;
strengthened the development and introduction of new potential suppliers, and continued to optimize the level-to-
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level management of suppliers, the institutionalization promoted the development of supplier cooperation projects,
and introduced 700 new products through multiple channels.
The gain rate of TCM decoction pieces in hospitals increased, and the market expansion of refined decoction
pieces achieved initial results, with a year-on-year increase of 45% in overall business; and the medical beauty has
launched a C-end marketing model.
(2) Retail direct selling:
Promoted the national top 100 chain projects, increased the depth of cooperation, and improved product
introduction. Accelerated the network layout of member stores, the total number of member stores has reached
1,313, and the sales increased by 66% on a year-on-year basis. Continued to give full play to the B2B advantages,
optimized online platform services, increased online marketable product specifications, and made sales promotion
for targeted product specifications to increase the customers' online ordering frequency.
(3) Retail diagnosis and treatment:
Continued to accelerate the layout of retail diagnosis and treatment stores in Guangdong and Guangxi. There were
120 drug stores (a net increase of 20 stores throughout the year) of Sinopharm Holding in Guangdong and
Guangxi, including 91 stores in Guangdong and 29 stores in Guangxi. 35 stores have obtained the "two-channel"
qualification, and continued to give full play to the brand advantages of "medical insurance + commercial
insurance", with a steady growth trend in sales. There were 31 prescription circulation projects, the total
circulation volume increased by 124%.
(4) Equipment consumables business:
Actively expanded and built business platforms with upstream manufacturers, set up a medical device experience
center, explored the marketing model of home medical devices, formed a clinical service team, realized the
extension of the service function of commercial platform, explored the cooperation model of large access to
medical devices, and developed the provincial integration of medical devices.
(5) Innovative business:
Actively promoted service transformation, and developed the in-hospital to C logistics/services, home and
community medical care and health care, medical union/medical community primary medical services, retail
diagnosis and treatment/retail direct selling and other directions. Integrated resources, promoted the professional
and platform-based construction of innovative business, and set up industry benchmark. For example, the
prescription circulation project of the First Affiliated Hospital of Sun Yat-sen University and the medical
consumables SPD project of Shenzhen Second People's Hospital won the top ten demonstration cases of
pharmaceutical supply chain service innovation. The medical supplies SPD management service project of
Affiliated Hospital of Youjiang Medical University for Nationalities, the whole process traceability system of
TCM decoction pieces and the intelligent allocation scheme (TSD+ scheme) were awarded as excellent cases of
pharmaceutical supply chain.
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(6) Third-party logistics:
Vigorously developed third-party logistics services, added Sinopharm Holding Guangzhou Shanghai equipment
warehouse, Sinopharm Holding Guangzhou public bonded warehouse. Disease control business had a year-on-
year growth of 197%, innovative pharmaceutical business had a year-on-year growth of 201%, pharmaceutical
equipment business had a year-on-year growth of 15%. The vaccine business maintained its leading position in
the regional market.
3. Business of Guoda Drugstore: focused on strategy, improved quality and efficiency, consolidated the stock
business scale, and explored innovative business development
(1) Accelerated the network layout of the whole network and promote the expansion and submersion of stores
By the end of 2021, Guoda Drugstore had a total of 8,798 stores, an increase of 1,138 stores compared with the
beginning of the year, among which, newly opened 1,155 direct-sale stores and closed 347 stores, a net increase of
808 stores, and a net increase of 93 franchised stores. The growth rate of newly opened stores hit a record high.
244 stores involved in the investment and acquisition project, 7 stores were transferred. Further sank the network
layout, expanded the county market, has established 58 county stores. Accelerated the development of franchise
business, set up the franchise management department, integrated the brand advantages and resource advantages
of Guoda, unified the standard process, and formed a standardized management mode.
(2) Focused on building self-operated e-commerce platforms and continuously promoted online and offline
integration
Focused on the development and construction of self-supporting platforms, which have been launched at more
than 6,000 stores in 26 regional companies. Built the we-media platform of Guoda Drugstore, so far 14 regional
subsidiaries have opened 28 WeChat video accounts. Improved the O2O operation quality of third-parties, the
number of online stores increased to 7,000, and the operating varieties increased to 2,000 SKU/stores. O2O gross
margin kept increasing, and O2O drug sales at night introduced traffic platforms such as Ping An Good Doctor.
The annual sales of e-commerce business (including B2C) reached 2230 million, an increase of 99.6% on a year-
on-year basis.
(3) Continued to innovate business models and create new pharmaceutical retail
1) Actively carried out the prescription outflow project and built internet hospitals: in response to the "two-
channel" policy of medical insurance, newly increased 13 medical insurance stores throughout the year;
cooperated with 16 internet hospital platforms, launched prescription outflow projects in Shenzhen, Inner
Mongolia, Xinjiang, Jilin and Shenyang, created one-stop service of "internet diagnosis and treatment + online
prescription circulation + home delivery of drugs". Jointly and newly established Jiaren Medical and Health
(Hainan) Co., Ltd., and has obtained the license of internet hospital and completed system connection.
2) Created a new retail model and promoted service upgrading: created the first new concept store integrating
SPS+ big health, and the store design won the "Top Ten Drugstore Retail Model Innovation Award"; 340 stores
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were open 24 hours a day to provide drug purchase services at night; set up 217 panda self-service medicine
vending machines to provide intelligent service for self-service medicine purchasing.
3) Explored the construction of digital intelligence unattended pharmacy: actively explored digital shelves +
machine vision + multi-sensor fusion technology to realize the non-inductive payment, artificial intelligence
assisting in-store customers and tracking of purchased drugs, and other digital application scenarios, piloted "non-
inductive payment" at Shenzhen Guoda Drugstore, and piloted "two-dimensional barcode payment" at Shanghai
Longhua East Road store.
(4) Continued to pay attention to the improvement of gross profit, and set up a project team for the improvement
of gross profit (procurement, commodities, private brands, marketing and operation), focusing on the adjustment
of sales structure and the control of gross profit margin of commodities. The main indicator of gross profit margin
basically reached the annual target.
(5) Vigorously promoted the systematic development of private brands
Promoted the business systematic construction of private brands, OEM business of private brands and "Guozhi"
products increased by 115% on a year-on-year basis. Created new models and new growth points, and created the
sales model of trend-setting product "Jie Bao Nuo" cotton pads and the innovative development model of
industrial and commercial cooperation of Sinopharm system.
(6) Continued to build a professional pharmaceutical service system
Carried out drug and information platform training, covering 31,863 shop assistants and management personnel
nationwide, focusing on five modules: professional basis, patient education, practical application, chronic disease
commodities and related commodities. Organized the training of licensed pharmacists, and 476 employees
obtained the qualification of licensed pharmacists. Provided health management services, provided professional
services for more than 7 million chronic disease members through health detection, member filing, health
education and medication guidance and other means. Improved the membership stickiness, Guoda Drugstore has
cooperated with the third-party Yiyouhui to build the membership platform, and has carried out 7 cooperation
projects with Novartis, Merck, Huizhi, Celebrex, Weigu and other manufacturers.
4. Improved quality, increased efficiency and sought benefits
Regularly promoted the special work of improving quality and efficiency. Increased the capital concentration,
enjoyed the tax preference, revitalized resources and saved costs. The human resources input and business
maintained good coordination, and the personnel scale continued to be dynamically optimized. The growth rate of
the team scale was much lower than the growth rate of the revenue scale. Accelerated the continuous optimization
of the company's business structure, and continued to carry out the reduction in "accounts receivable and
inventory". Adopted one enterprise one policy for subordinate loss-making enterprises, refined the measures to
stop losses, and increased the intensity of special assessment.
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5. Continued to promote comprehensive digital transformation
Promoted integrated management of information and continuously optimized management processes and business
links with digital projects. Strengthened basic management of information, established a stable and efficient
support system for infrastructure equipment, carried out database inspection and optimization, and completed the
construction of Guangzhou-Shenzhen disaster recovery platform. Promoted the implementation of digital projects
of management platform and business system, improved the financial sharing platform, Guodu Drugstore
switched to NC unified financial platform, and piloted the launch of financial robots. Distribution centered on the
strategic deployment of "one body and two wings", and carried out the connection of automation special projects
for supply chain, micro mall, dual channel, prescription circulation, etc.. Guodu Drugstore has promoted the
establishment of a number of digital transformation projects such as unmanned intelligent pharmacy, optimized
business system, promoted the online use of the unified DTP system, and optimized and constructed the online
mall system and OMS system.
6. Technology energized, optimized the efficiency of the supply chain
Continued to promote the logistics network planning, at present, the company has 61 self-operated + entrusted
logistics centers, with a total area of 370,000 square meters, which have established the indicator system for
supply chain logistics monitoring throughout the country, carried out the national logistics planning and B2B2C
planning for the integration of wholesale and retail, broke the scattered layout of "one place one warehouse",
improved the efficiency of warehouse network. Made overall arrangements for logistics and wholesale and zero
integration, joint supply, joint inventory, and joint network.
Promoted the digital intelligence transformation of logistics warehouses, created the 3A smart logistics solution
(AS/RS+AMR+AI), used OCR+AI visual identification system, Sinopharm Group Guangdong Logistics
introduced mechanical arm, AGV intelligent vehicle and other intelligent equipment to open up logistics
management system, the warehousing density increased by 10%, overall efficiency increased by 25%. AGV
unmanned warehouse realized its own FYWMS system docking AGV scheduling, realized multi-floor intelligent
equipment scheduling, and effectively improved supply chain efficiency.
7. Continued to promote the core strategy of integrating wholesale and retailing
Explored the connotation and value of "integrating wholesale and retail" and promoted the extension of resources
to the upstream and downstream of the industrial chain. Launched the expansion of the pilot area for the
integration of wholesale and retail, and added 10 regions including Shanxi and Inner Mongolia for promotion in a
total of 15 regions. Based on the principle of "one place, one policy", the pilot project continued to be promoted
dynamically and relied on the operation characteristics of each region to output effective business models and
profit models. The coordinated sales of wholesale and retail in Guangdong Province reached 1030 million.
Operation of the retail stores during the reporting period:
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1. By the end of 2021, Guoda Drugstore has 7,257 direct-sale stores, sales revenue amounted to 16,640 million
yuan; and has 1,541 franchised stores, the distribution revenue amounted as 1,340 million yuan.
Direct-sale store Franchised outlet
Region Sales revenue (in 10 thousand Distribution revenue (in 10
Numbers Numbers
Yuan) thousand Yuan)
North 4,627 1,034,759 669 61,877
East China 1,086 261,094 603 57,809
South China 555 157,400 117 7,390
Central China 312 56,665 147 6,397
Northwest 346 105,873 5 108
Southwest 331 48,492 0 0
Total 7,257 1,664,283 1,541 133,581
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 1,155 new direct-sale stores opened and 347 closed in 2021, a net increase of 808 stores.
Region Direct-sale store
Number of store increased Total area (square meters)
North 748 77,154
East China 170 19,529
South China 99 11,382
Central China 32 3,212
Northwest 61 6,539
Southwest 45 5,248
Total 1155 123,064
(2) Medical insurance qualification of the stores
As of December 31, 2021, the Company has 7,257 chain stores with directly selling, and 6,338 pharmacy stores
obtained the qualification of “Designated retail pharmacies of medical insurance”, representing 87% of the total
pharmacies of the Company.
Region Number of stores Stores obtained the qualification of Ratio in total pharmacies in
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“Designated retail pharmacies of medical regions
insurance”
North 4,627 4,170 90%
East China 1,086 855 79%
South China 555 458 83%
Central China 312 250 80%
Northwest 346 295 85%
Southwest 331 310 94%
Total 7,257 6,338 87%
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
2020 90 52% 41% 67% 59%
2021 90 54% 41% 70% 64%
(1) Classify according to region
Amount of sales growth (tax-free, in 10 thousand
Region Gross margin Net profit ratio
yuan)
North 209,211 23% 3%
East China -4,176 21% 0%
South China -2,431 24% 1%
Central China -5,148 26% 1%
Northwest 24,064 20% 2%
Southwest 29,828 41% 8%
(2) Operating efficiency of direct-sale stores during the reporting period
Daily average efficiency (tax-
Operating area of the stores Rental efficiency (tax-included,
Region Number of stores included, Yuan/Square
(square meters) annual sales volume/rental)
Meters)
North 4627 575,992 48 15
East China 1086 136,491 52 14
South China 555 64,102 65 15
Central China 312 36,301 43 14
Northwest 346 41,115 71 28
Southwest 331 40,200 33 11
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.
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Rental efficiency=Annual sales volume/Yearly rental
3.Top 10 stores in terms of operating revenue
The cumulative operating revenue from top 10 stores takes 6.4% in Guoda Drugstore’s overall operating revenue.
Building Operation Property
Name of the store Address地址 Date of opening
area（m2） mode ownership
1/F, No.57 Qingyuan Directly
Head store of Lerentang 2010/9/16 1206 Rental properties
Street operated
(1/F,2/F) No.65
Tongdao North Street, Directly
Head store 2003/3/18 1290.35 Rental properties
Huimin District, operated
Hohhot
Opposite the outpatient
department of Shanda Directly
Yi Yuan Zongli Store 2002/9/27 821.8 Rental properties
First Hospital, No.88 operated
Jiefang South Road
Opposite the Shanda
Second Hospital,
No.232 Wuyi Road, Directly
2011/2/14 629.9 Rental properties
Yi Yuan Er Yuan Store Xinghualing District, operated
Taiyuan, Shanxi
Province
No.114 Xidan North
Directly
Xidan Golden Elephant Street, Xicheng 1997/5/3 783.66 Rental properties
operated
District, Beijing
North 1/F, No.816
Building, Sungang Directly
Showroom 2006/12/23 260 Rental properties
Storage District, operated
Bao’an North Road
Yangzhou Baiyulan No.511 Wenchang Directly
1991/9/1 840 Rental properties
Pharmacy Mall Middle Road operated
No.101, 1/F Podium
Xilong Liyuan, Beili Directly
Bu Xin village 2017/4/1 337 Rental properties
South Road, Luohu operated
District, Shenzhen
No.14 Shop, Zhenhai
Garden, No.97 Directly
Xiamen New Special Drugstore 2005/3/30 133 Rental properties
Zhenhai Road, Siming operated
District
Lianhua Building,
Lianhua Second Directly
Lianhua North 2003/12/1 120.33 Rental properties
Village, Hongli West operated
Road, Futian District,
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Shenzhen
4.Structure of the category at retail terminal
Category 2021 2020
Rx Drug 54.40% 52.11%
OTC 25.60% 25.83%
Household health products 5.30% 4.29%
Health care products 4.60% 5.03%
TCM 4.00% 1.25%
Proportion of other categories 3.80% 3.00%
Personal care 1.20% 0.34%
Convenience food 0.90% 0.84%
Home convenience 0.20% 7.33%
Total 100% 100%
5. 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 2021:
Ranking Purchase amount (tax included) (10 thousand yuan) Procurement ratio
No.1 82,276.79 3.9%
No.2 65,267.62 3.1%
No.3 56,673.88 2.7%
No.4 56,620.11 2.7%
No.5 50,971.50 2.4%
6. Member management and service business
In 2021, the membership sales accounted for 67% with no change in the shares from 2020. At the same time, the
number of member transactions in 2021 has increased by 25% from a year earlier. The proportion of member
transactions in total transactions increased from 56% in 2018 to 64% in 2021. 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 2021, the per
customer transaction from members was 108 yuan while 82 yuan from non-members. The main difference
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between members and non-members lies in the degree of brand recognition and the differentiation of the types of
goods purchased.
7. Warehousing and logistics during the reporting period
By the end of 2021, Guoda Drugstore has a total of 33 logistic centers/distribution centers in 20 provinces
(including 9 commissioned logistics and 24 owned logistics) and owns warehousing of 190,000 square meters
nationwide; of which, 1463 square meters for cold storage with 3880 cubic meters in volume, which are used for
storage and circulation of normal temperature, shady and cool, and refrigerated products, guaranteed the
commodity distribution for all customers; owns 173 logistic vehicles in the country and 20 vehicles for
refrigeration; Number of the logistics workforce nationwide from Guoda was 1387; the annual throughput have
20,490,000 pieces throughout the country and annual orders were 98,860,000 pieces.
8.On-line sales during the reporting period
In 2021, on-line sales have a growth of 56% from a year earlier, including 33% up from self-operated platform,
the third-party O2O business increased by 93% on a y-o-y basis and 8% up from B2C business. O2O network
layout covering more than 7,000 stores in 23 provinces nationwide.
9. Undertake prescription outflow and chronic disease management
With the continuous deepening of the national pharmaceutical reform, the basis of the model of realizing the high
added value of medicine with doctors' labor has been collapsed through policies such as volume-based
procurement, centralized bidding, and dual-channel, and prescription outflow has gradually become a trend. In
2021, the overall prescription sales of Guoda Drugstore was 9,980 million (including DTP), a year-on-year
increase of 21.3%. Took Xinjiang region as an example, the sales of prescription drugs in 2021 was 720 million
(including DTP), a year-on-year increase of 60%. The sales of prescription drugs have had a major impact on
chain drugstores.
In order to better undertake the prescription outflow, it is necessary to strengthen professional service capacity and
establish chronic disease management team. In 2021, Guoda Drugstore organized weekly online learning for
diabetes specialists and hypertension specialists, covering 26 regions, and trained 2,593 diabetes specialists and
2,568 hypertension specialists. A total of 1.01 million members of diabetes and 970,000 members of hypertension
have been recorded, and the sales of diabetes and hypertension products increased by 11.7% and 14.2% on a year-
on-year basis.
10. Development of innovative business
In 2021, the innovative business of Guoda Drugstore was driven by the business model of doctor+ medicine +
insurance. In November 2021, Jialong Health Co., Ltd., in which Guoda Drugstore holds stakes, obtained the
qualification of Hainan Internet Hospital, laying a foundation for Guoda Drugstore to realize online services and
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medical treatment. In terms of commercial insurance, the sales increased by 159% on a year-on-year basis in 2021,
involving multi-faceted business attempts such as fund insurance, serious diseases and chronic diseases. The e-
commerce business continued to maintain rapid growth in the construction of self-operated platforms and O2O.
The self-operated platforms realized employee commission model, introduced some big health products for online
distribution, in 2021, Guoda Drugstore achieved breakthroughs in the self-media and live broadcast business,
completed more than 340 live broadcasts, worked with Meituan, Ele.me and other cooperative brands to create
short videos and other publicity, and enhanced the overall brand image of the company. Meanwhile, the self-
service drug purchase machine business, which had been piloted and explored since 2019, achieved a good
breakthrough in 2021. By the end of 2021, a total of 217 self-service drug purchase machines were installed in
airports, stations, hospitals, enterprises, parks, pharmacies and other channels.
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 owns complete drug distribution network, sales of all forms have achieved a
steady growth.
(1) There were 27 prefecture-level cities in Guangdong and Guangdong fully cover medical institutions at all
levels, small social medical institutions, and retail chain single-store terminals; in terms of retail diagnosis and
treatment, DTP and hospital-side pharmacies (Sinopharm Holding Drugstore) reaching 120;
(2) Guoda Drugstore has 8,798 retail stores and chain network spans 20 provinces and autonomous regions,
covering more than 150 cities in China.
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 60,000.
Guoda Drugstore operates nearly 180,000 merchandises. With its relatively comprehensive purchasing network
and years of experience in commodity management, Guoda Drugstore has established a merchandise system with
wide coverage, high professionalization, and rich varieties.
3. Complete logistics and distribution system
In terms of distribution, warehousing and transportation network, the logistics center has more than 180,000
square meters of warehouse space in Guangdong and Guangxi; 5 logistics centers, 23 distribution centers, and 1
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transfer station have formed a stepped logistics distribution network. Relying on Sinopharm Holding's national
logistics resources and combined with the carrier resources, we have achieved full coverage of national urban and
rural medical logistics. In terms of informatization and automation, it has a modern logistics management system,
including WMS warehouse management system, TMS intelligent dispatching system, logistics visualization
system, AGV goods-to-person system, mechanical arm and five-sided scanning code instrument, to realize the
digitalization and intelligentization of logistics, and continuously improve the efficiency and quality of logistics
services. In terms of operation management, it has implemented unified standardized operation norms and
management, and implemented integrated quality management system, integrated information management,
integrated operation management. It has implemented unified planning, unified deployment, and unified
management for logistics resources management.
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 190,000 square
meters in total. The headquarters logistics management is responsible for the logistics warehouses management of
all the subsidiary in the country, makes planning and construction for the logistics network, and collects and
analyzes the information of each warehouse, it is the highest logistics management organization. The headquarters
logistics provides the main line distribution of the collectively purchased commodities to each warehouse, and the
subsidiaries’ logistics of each region provides all commodity distribution to local stores and external customers.
The companies with wholesale qualifications can also do wholesale distribution between warehouses.
4. Advantages of stores with medical insurance resources and dual channel
In terms of distribution and retail, by the end of 2021, 37 pharmacies in 24 cities in Guangdong and Guangxi have
obtained the qualification of "dual-channel" pharmacy. Among them, 25 stores in 14 cities in Guangdong province
have obtained the qualification of "dual-channel" pharmacy, serving more than 100,000 of the insured in total,
their professional and meticulous services have been approved by the local insured, medical insurance, hospitals
and industry associations.
In terms of the development of pharmaceutical retail, the subsidiaries of Guoda Drugstore generally have a higher
ability to obtain medical insurance resources, with a relatively high proportion of medical insurance sales and
stable operation. By the end of 2021, there were 6,338 medical insurance stores, and the sales of directly-operated
medical insurance stores, including tax, reached 16.69 billion yuan, rose by 17% on a year-on-year basis. The
sales of directly-operated medical insurance cards, including tax, amounted to 7.4 billion yuan, rose by 26% on a
year-on-year basis. There were 102 dual-channel stores with cumulative sales of 2.8 billion yuan.
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.
29
6. The Sinopharm brand with unique influential
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.
30
IV. Main business analysis
1. Overview
Found more in “II. Main business of the Company during the reporting period” in Section III Management Discussion and Analysis”
2. Revenue and cost
(1) Constitute of operation revenue
In RMB
2021 2020
Increase/decrease y-
Ratio in operation Ratio in operation
Amount Amount o-y (+,-)
revenue revenue
Total operation
68,357,809,571.99 100% 59,649,455,012.03 100% 14.60%
revenue
According to industries
Pharmaceutical
47,415,894,164.79 69.36% 41,771,721,959.60 70.03% 13.51%
distribution
Retail pharmacy 20,546,784,164.42 30.06% 17,626,007,757.96 29.55% 16.57%
Other 395,131,242.78 0.58% 251,725,294.47 0.42% 56.97%
According to products
Pharmaceuticals 60,694,809,091.70 88.79% 54,004,558,520.07 90.54% 12.39%
Medical devices and
5,831,199,233.19 8.53% 4,010,735,060.66 6.72% 45.39%
disposables
Diagnostic reagents 994,724,313.55 1.46% 947,638,322.63 1.59% 4.97%
Medical equipment 441,945,690.77 0.65% 434,797,814.20 0.73% 1.64%
Other 395,131,242.78 0.57% 251,725,294.47 0.42% 56.97%
According to region
China 68,357,809,571.99 100.00% 59,649,455,012.03 100.00% 14.60%
According to sales model
Direct sales 38,830,595,892.43 56.80% 34,359,157,282.46 57.60% 13.01%
Direct operated 20,185,616,638.57 29.53% 17,322,376,918.91 29.04% 16.53%
Distribution 8,585,298,272.36 12.56% 7,412,564,677.14 12.43% 15.82%
Franchise 361,167,525.85 0.53% 303,630,839.05 0.51% 18.95%
31
Other 395,131,242.78 0.58% 251,725,294.47 0.42% 56.97%
(2) About the industries, products, regions and sales model 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
According to industries
Pharmaceutical
47,415,894,164.79 44,666,346,065.22 5.80% 13.51% 13.93% -0.34%
distribution
Retail pharmacy 20,546,784,164.42 15,429,302,517.26 24.91% 16.57% 16.31% 0.17%
According to products
Pharmaceuticals 60,694,809,091.70 53,331,853,978.64 12.13% 12.39% 12.48% -0.07%
According to region
China 68,357,809,571.99 60,339,298,052.24 11.73% 14.60% 14.73% -0.10%
According to sales model
Direct sales 38,830,595,892.43 36,407,984,196.22 6.24% 13.01% 13.40% -0.31%
Direct operated 20,185,616,638.57 15,419,114,595.98 23.61% 16.53% 16.34% 0.12%
Distribution 8,585,298,272.36 8,258,361,869.00 3.81% 15.82% 16.33% -0.42%
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
Increase/decrease y-
Industry Item Unit 2021 2020
o-y (+,-)
Sales Yuan 67,962,678,329.21 59,397,729,717.56 14.42%
Medicine circulation
Inventory Yuan 7,632,642,537.46 6,298,008,008.81 21.19%
Explanation on reasons for the y-o-y change of more than 30% in relevant data
□Applicable √Not applicable
32
(4) Fulfillment of the significant sales contracts or significant procurement contract signed by the Company
up to the reporting period
□Applicable √Not applicable
(5) Constitute of operation cost
According to industry
In RMB
2021 2020
Increase/decrease
Industries Item Ratio in Ratio in
Amount Amount y-o-y (+,-)
operation cost operation cost
Pharmaceutical
Sales cost 44,666,346,065.22 74.03% 39,206,149,975.93 74.55% 13.93%
distribution
Retail pharmacy Sales cost 15,429,302,517.26 25.57% 13,265,264,981.82 25.22% 16.31%
Other Other cost 243,649,469.76 0.40% 120,352,506.62 0.23% 102.45%
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 found more in Note VI of Section X. Financial Report.
(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) 3,290,310,903.48
Proportion in total annual sales volume for top five clients 4.80%
Ratio of related parties in annual total sales among the top
0.00%
five clients
33
Information of top five clients of the Company
Serial Name Sales amount (RMB) Proportion in total annual sales
1 No. 1 986,633,581.55 1.44%
2 No. 2 693,712,842.71 1.01%
3 No. 3 569,811,978.70 0.83%
4 No. 4 542,410,122.37 0.79%
5 No. 5 497,742,378.15 0.73%
Total -- 3,290,310,903.48 4.80%
Other situation of main clients
□ Applicable √ Not applicable
Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 7,149,354,710.42
Proportion in total annual purchase amount for top five
11.24%
suppliers
Ratio of related parties in annual total sales among the top
1.44%
five suppliers
Information of top five suppliers of the Company
Serial Suppliers Purchase amount (RMB) Proportion in total annual purchases
1 No. 1 4,198,796,922.26 6.60%
2 No. 2 913,988,957.83 1.44%
3 No. 3 707,108,393.82 1.11%
4 No. 4 676,680,463.56 1.06%
5 No. 5 652,779,972.95 1.03%
Total -- 7,149,354,710.42 11.24%
Other notes of main suppliers of the Company
□ Applicable √ Not applicable
3. Expenses
In RMB
34
Increase/decrease
2021 2020 Note of major changes
y-o-y (+,-)
Mainly due to the incremental impact
brought by acquisition, as well as
increase in the y-o-y growth of labor
costs, depreciation of right-to-use
Selling expenses 4,752,862,965.09 3,943,134,095.75 20.54%
assets and rental fees from company
expansion, a larger increase in current
sales expenses resulted compared with
the same period of last year
Administrative expenses 1,045,635,601.17 1,008,178,815.78 3.72% No major changes occurred
Mainly due to the large-scale
acquisition in 2020, and corresponding
consideration for the acquisition are
Finance costs 212,482,801.90 119,855,169.85 77.28%
paid in succession, the interest from
deposit declined correspondingly for
the decrease of bank deposit.
4. R&D expenses
□ Applicable √ Not applicable
5.Cash flow
In RMB
Item 2021 2020 Increase/decrease y-o-y (+,-)
Total cash inflows from
72,335,807,374.26 63,412,452,004.15 14.07%
operating activities
Total cash outflows from
70,680,626,397.39 61,909,705,405.68 14.17%
operating activities
Net cash flows from operating
1,655,180,976.87 1,502,746,598.47 10.14%
activities
Total cash inflows from
173,179,559.74 211,813,981.71 -18.24%
investing activities
Total cash outflows from
628,711,629.74 2,995,043,135.68 -79.01%
investing activities
Net cash flows from investing
-455,532,070.00 -2,783,229,153.97 83.63%
activities
Net cash flows from investing
1,055,771,929.93 1,166,552,513.20 -9.50%
activities
Total cash outflows from
2,927,412,453.05 2,906,975,331.01 0.70%
financing activities
35
Net cash flows from financing
-1,871,640,523.12 -1,740,422,817.81 -7.54%
activities
Net decreased amount of cash
-671,601,035.64 -3,020,957,912.17 77.77%
and cash equivalent
Main reasons for y-o-y major changes in aspect of relevant data
√Applicable □ Not applicable
(1) Total cash outflows from investing activities has 79.01% down from a year earlier, mainly because the payment for subsidiary
acquisition in current period by Guoda Drugstore decreased compared with the same period of previous year;
(2) Net cash flows from investing: has 83.63% up from a year earlier, mainly because the payment for subsidiary acquisition in
current period by Guoda Drugstore decreased compared with the same period of previous year;
(3) Net decreased amount of cash and cash equivalent: has 77.77% up from a year earlier, mainly because the payment for subsidiary
acquisition in current period by Guoda Drugstore decreased compared with the same period of previous year; and the cash received
from sales and proving labor service increased with the soaring operation revenue in the period.
Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
□Applicable √Not applicable
V. Analysis of the non-main business
□ Applicable √ Not applicable
VI. Analysis of assets and liabilities
1. Major changes of assets composition
In RMB
Year-end of 2021 Year-begin of 2021
Ratio changes
Ratio in Ratio in Notes of major changes
Amount Amount (+,-)
total assets total assets
Cash and
5,126,159,080.94 11.98% 5,998,204,295.87 15.15% -3.17% No major changes occurred
bank balances
Account
15,964,603,345.91 37.31% 13,799,971,014.22 34.85% 2.46% No major changes occurred
receivable
Contract
29,061,159.52 0.07% 15,177,731.64 0.04% 0.03% No major changes occurred
assets
Inventories 7,621,541,595.08 17.81% 6,285,010,674.46 15.87% 1.94% No major changes occurred
Investment
113,981,497.23 0.27% 127,444,379.94 0.32% -0.05% No major changes occurred
properties
36
Long-term
equity 2,459,832,546.74 5.75% 2,287,019,627.99 5.78% -0.03% No major changes occurred
investments
Fix assets 868,626,258.43 2.03% 854,191,083.27 2.16% -0.13% No major changes occurred
Construction
49,849,506.70 0.12% 46,631,190.23 0.12% 0.00% No major changes occurred
in progress
Right-to-use
2,575,240,340.00 6.02% 2,356,952,392.99 5.95% 0.07% No major changes occurred
assets
Short-term
1,930,467,146.38 4.51% 1,612,187,020.12 4.07% 0.44% No major changes occurred
borrowings
Contract
431,303,231.37 1.01% 368,600,357.14 0.93% 0.08% No major changes occurred
liabilities
Long-term
71,637,173.89 0.17% 31,637,173.89 0.08% 0.09% No major changes occurred
borrowings
Lease
1,375,427,877.28 3.21% 1,303,054,163.90 3.29% -0.08% No major changes occurred
liabilities
Foreign assets account for a high proportion
□Applicable √ Not applicable
2. Assets and liability measured by fair value
√Applicable □ Not applicable
In RMB
1. Assets and liabilities at fair value
2021
Input applied in the measurement of fair value
Quoted prices in Significant Significant
active markets observable inputs unobservable inputs Total
Level 1 Level 2 Level 3
Continuous measurement of
fair value
Receivables financing - 1,027,226,940.21 - 1,027,226,940.21
Other investment in equity
instruments - 62,488,312.99 - 62,488,312.99
Other non-current financial
assets - - 135,974,908.51 135,974,908.51
- 1,089,715,253.20 135,974,908.51 1,225,690,161.71
37
2020
Input applied in the measurement of fair value
Quoted prices in Significant observable Significant
active markets inputs unobservable inputs Total
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
2. Assets and liabilities disclosed at fair value
2021
Input applied in the measurement of fair value
Significant Significant
Quoted prices in active markets observable inputsunobservable inputs Total
Level 1 Level 2 Level 3
Long-term borrowings - 71,637,173.89 - 71,637,173.89
2020
Input applied in the measurement of fair value
Significant Significant
Quoted prices in active markets observable inputsunobservable inputs Total
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
38
3. Assets right restriction till end of reporting period
2021 2020 Note
Cash and cash equivalents 392,646,858.59 593,091,037.88 (1)
Notes receivable that were
endorsed 31,886,681.19 4,095,283.92 (2)
Receivables financing that were
pledged - 2,620,000.00 (3)
424,533,539.78 599,806,321.80
(1) As at 31 December 2021, the Group had deposits of bank acceptance bills, Medical reserve funds, and other
restricted cash of RMB392,646,858.59 (31 December 2020: RMB593,091,037.88) (Annotation V-1 in Section X. Financial
Report)
(2) As at 31 December 2021, the Group had notes receivable of RMB31,886,681.19 (31 December 2020: notes
receivable of RMB4,095,283.92), which were endorsed but not have matured (Annotation V-2 in Section X. Financial Report)
(3) As at 31 December 2021, the Group had no pledged receivables financing (31 December 2020: 2,620,000.00)
(Annotation V-4 in Section X. Financial Report)
VII. Investment analysis
1. Overall situation
√ Applicable □ Not applicable
(1) During the reporting period, the Company acquired the two enterprises in cash with combined under the
different control, including Yunnan Guoda Disheng Pharmaceutical Co., Ltd. (70% equity) and Yunnan Guoda
Disheng Pharmacy Chain Co., Ltd. (70% equity). New subsidiaries are established by the Company, including
Guoda Drugstore (Heze) Co., Ltd. (51% equity), Sinopharm Holding Guigang Pharmacy Co., Ltd. (100% equity)
and Hunan Guoda Drugstore Medicine Co., Ltd. (100% equity).
(2)During the reporting period, the Company completed the capital contribution for Guoda Wanmin Huimin
Kangwei Pharmacy Lvliang Co., Ltd and Sinopharm Holding Guoda Jianfeng (Jiangmen) Medicine Chain Co.,
Ltd, -the new enterprises established in 2020, and part of the capital contribution for Liaoning Huludao Guoda
Drugstore Co., Ltd-the new enterprise established in 2020.
(3) During the reporting period, the Company completed the capital increase to Shanghai Pudong Pharmaceutical
and Herbal Materials Co., Ltd(75% equity) and Shanghai Yanghetang Pharmaceutical Chain Operation Co.,
Ltd.(100% equity), after capital increase, the shareholding ratio remained unchanged.
(4) During the reporting period, the Company acquired the assets of 15 direct operated stores under Sinopharm
Holding Nantong Puji Pharmacy Chain Co., Ltd and 32 direct operated stores under Shanxi Huimin Kangwei
39
Drugstore Chain Co., Ltd in cash.
(5) During the reporting period, the Company takes 25% equity of Jialong (Hainan) Health Management Group
Co., Ltd.
(6) The Company subscribes the Sinopharm Zhongjin Medical Industry Fund (phase II) during the reporting
period. Initial capital contribution has been paid.
Found more in Annotation V-(12), Annotation VI and Annotation VII in Section X. 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
The Company had no application of raised proceeds in the reporting period.
VIII. 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.
40
2. Sales of major equity
□ Applicable √ Not applicable
IX. 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, medical
apparatus and
instruments, freight
transportation, storage,
loading and unloading,
Sinopharm glass wares, cosmetics
Holding and daily merchandise; 3,553,249,3 18,509,814, 4,863,231,3 35,615,183,0 916,466,812 681,500,98
Subsidiary
Guangzhou other business services, 93.17 495.03 59.84 95.63 .83 7.20
Co., Ltd. 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 features
Guoda 1,683,333,3 15,983,835, 5,682,312,4 22,477,630,0 296,932,584 184,049,10
Subsidiary of treatment and
Drugstore 33.00 238.55 76.11 28.55 .24 0.87
diagnosis, shaped
Co., Ltd.
packing food, chemical
（note 1）
products, and various
commodity and
technique hold by self-
support and agency as
well as import & export
of technology
41
Retail and distribution
in respect of
Sinopharm
pharmaceutical products
Holding 521,407,965 4,942,831,1 1,228,470,3 6,547,103,82 198,578,757 174,291,46
Subsidiary and medical apparatus
Guangxi .79 90.03 99.97 4.95 .26 5.30
and instruments,
Co., Ltd.
wholesale and retails of
health products
Particular about subsidiaries obtained or disposed in report period
√ 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 medicine
Yunnan Guoda Disheng Pharmaceutical distribution in local area, and without
Acquisition
Co., Ltd. major influence on performance of the
Company
Expand the business layout of medicine
Yunnan Guoda Disheng Pharmacy Chain
Acquisition retail in local area, and without major
Co., Ltd.
influence on performance of the Company
Expand the business layout of medicine
Guoda Drugstore (Heze) Co., Ltd. Establishment retail in local area, and without major
influence on performance of the Company
Expand the business layout of medicine
Sinopharm Holding Guigang Pharmacy
Establishment retail in local area, and without major
Co., Ltd
influence on performance of the Company
Expand the business layout of medicine
Hunan Guoda Drugstore Medicine Co., distribution in local area, and without
Establishment
Ltd. major influence on performance of the
Company
Explanation on main holding and stock-jointly enterprise
Note 1: The net profit of Guoda Drugstore, a subsidiary of the Company, decreased by 61.38% compared with the same period of last
year, which was mainly due to the results of the impairment test on goodwill and intangible assets this year. Following the principle
of prudence, Guoda Drugstore made provision for impairment of goodwill and intangible assets (brand use rights and sales network)
of its subsidiaries, Shanghai Dingqun Enterprise Management Consulting Co., Ltd. (and Sinopharm Holding Tianhe Jilin
Pharmaceutical Co., Ltd.), please see details in the Notice on Provisions for Impairment of China National Accord Medicines
Corporation Ltd. (No. : 2022-03). At the same time, there were 1155 newly opened direct-operated stores in 2021, of which the initial
investment was large and the benefits have not yet appeared. Due to multiple influences such as industry policies and the pandemic,
the profit space shrank.
42
X. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
XI. Future Development Prospects
(i) Industry pattern and trend
(1) As the concentration of the pharmaceutical industry increases, the business model will be reconstructed.
According to the Guiding Opinions on Promoting High-quality Development of Drug Circulation Industry in the
"14th Five-year Plan" Period issued by the Ministry of Commerce, the overall goal by 2025 is to cultivate 1-3
large-scale digital and comprehensive drug circulation enterprises of over 500 billion yuan and 5-10 large-scale
digital and comprehensive drug circulation enterprises of over 100 billion yuan, and the drug retail chain rate is
close to 70%. It can be seen that the state supports and encourages the formation of a national and regional leading
pattern, whether the upstream original drug manufacturers, generic drug manufacturers, or the midstream
distribution enterprises, will accelerate the rise of market concentration, while the small and medium size
circulation enterprises with weak comprehensive strength will be eliminated, the business model of the circulation
industry will be reconstructed.
(2) With the acceleration and expansion of centralized procurement, the gross profit margin is further reduced.
The scope of volume-based centralized procurement will continue to expand, drug prices will further decrease,
and gross profit margin will be further reduced. Chemical medicine, Chinese patent medicine and biological
medicine will carry out volume-based centralized procurement in an all-round way, and high-value medical
consumables will focus on orthopedic consumables, drug balloons, dental implants and other varieties. At the
same time, cross-regional alliance volume-based procurement with quantity will gradually become a trend; while
more and more varieties of Chinese patent medicine and biological agents will be included in the centralized
procurement. With the further expansion of centralized procurement, the gross margin of pharmaceutical
consumables will further decline.
(3) The innovation, transformation and upgrading of the pharmaceutical market has accelerated the reshuffle of
the industry. As the medical reform enters the deep end, the medical ecology has changed greatly due to volume-
based procurement and medical insurance negotiation. Policies encourage innovation. In the face of the new
pattern, traditional pharmaceutical enterprises seek transformation in marketing models, research and
development strategies, overseas layouts and other aspects to cope with or lead the development of the industry
trends. According to the national policy orientation and the increasingly fierce competition among circulation
enterprises, circulation enterprises will constantly promote business model innovation and service innovation, and
improve business performance while steadily developing the scale.
43
(4) The increase in market demand for pharmaceutical consumption and diversified payment funds will jointly
support the scale of the pharmaceutical retail market. According to the forecast of MENET.COM.CN, by 2029,
the market size of retail drugstore terminal alone will reach 1.15 trillion yuan.
(5) Innovative drugs, traditional Chinese medicine and other categories will become the main force driving the
pharmaceutical retail market in China. According to the "14th Five-Year Plan" for Pharmaceutical Industry
Development jointly issued by the nine government departments on January 2022, an innovation-driven
development pattern will be fully formed, with more original innovative drugs and "leading" products, China will
become an important source of global pharmaceutical innovation. According to the forecast of IQVIA, in the next
five years, driven by the increase in the number and consumption of innovative drugs on the market, China's
pharmaceutical expenditure will grow at a 3.8% CAGR, and the growth will be mainly driven by the innovator
brand drugs, with a CAGR of 10.4% from 2022 to 2026. Retail pharmacies will enjoy this wave of out-of-hospital
market dividend of these innovative drugs through the "dual channel" qualification.
(6) With the reform of "linkage of medical services, medical insurance, and medicine", the drug prices have
dropped comprehensively, the retail pharmacies need to accelerate the development and transformation driven by
innovative services and cultivate new revenue growth points. Compared with the transformation and innovation
ideas of the world-class enterprises, such as the innovative medical and health service strategy of Walgreens
Boots Alliance, and vigorously develops health care clinic services such as VillageMD, and Health Corner.
(ii) Possible risks
1. The COVID-19 pandemic continues to affect. Although the COVID-19 pandemic has been effectively brought
under control in China, there are still sporadic outbreaks. In case of an outbreak within the company's business
area, the decline of outpatient visits and outpatient drug consumption will still have a significant impact on the
company's business within the current strict prevention and control measures.
2. Policy risks: National policies have direct guidance and influence on the development of pharmaceutical retail
industry. Under the premise of controlling the cost of medical insurance, the centralized and volume-based
procurement of drugs have become normalized and institutionalized, and the prices of drugs have dropped in an
all-round way. In addition to full-scale increase in the variety and quantity of drugs by centralized procurement,
drug price linkage mechanism has also been successively implemented in some regions. The supply chain ability
and profitability of retail drugstores are facing challenges. At the same time, the supervision of medical insurance
fund is becoming stricter. The informatization construction of medical insurance will be accelerated
comprehensively, and a national unified medical insurance information platform will be built. In the future, the
national unified medical insurance information platform will be vertically and horizontally connected, internally
and externally interconnected, and ecologically integrated, and the medical insurance information will be
comprehensively transparent. The supervision of medical insurance fund will be upgraded comprehensively, with
higher requirements on compliance operation of pharmacies, the compliance costs of pharmacies will increase.
44
Policies on rules of Internet diagnosis and treatment have been issued, and strict restrictions have been imposed on
issuing prescriptions for the first visit and on the statistics of medication information. Business operations of
drugstores such as online diagnosis and treatment and pharmaceutical e-commerce also face greater compliance
requirements.
3. Market changes and market competition risks: The pharmaceutical retail industry has entered a stage of high-
quality development, the growth rate of market size has slowed down, while the overall number of stores is still
increasing. In this environment, the competition in the industry intensifies, all major chain stores are seizing the
opportunity to expand their store volume by means of self-opening, franchising, and mergers and acquisitions, and
the industry concentration continues to increase. The uptrend of customer flow in offline drugstores is blocked,
which is not only squeezed by online channels, but also affected by the return of some patients to hospitals caused
by centralized procurement. Retail pharmacies face challenges from horizontal competition, online channel
competition, and competition from medical institutions, especially primary medical institutions. As a scale-
leading chain drugstore enterprise in the industry, Guoda Drugstore has a store network covering 20 provinces and
cities across the country. Backed by Sinopharm Group and Sinopharm Accord, it has competitive advantages in
supply chain capabilities, hospital channel resources, brand value, and logistics capabilities. However, as the
industry competition intensifies, there are still challenges to maintain the industry's leading position, scale and
competitive advantage.
4. Public opinion risks: The popularity of the Internet has led to the rapid spread of network information. With the
continuous expansion of online social networks, the spread of information is not only through traditional media,
but also through the dynamics of social account sharing, so public opinion has become a more important risk.
5. Compliance risks: In recent years, drug management has become stricter and GSP regulations have become
more stringent. For example, the appearance inconformity of Traditional Chinese Medicine decoction pieces and
the mold and moth-eaten drugs are all treated as counterfeit and inferior medicines. Penalties for violations have
been increased. In addition to exposure and gradually rising fines, penalties such as revocation of medical
insurance qualifications have also occurred from time to time. The implementation of the new edition of the "Drug
Administration Law" means that we will face the most severe punishment under the strongest supervision.
Government market management activities such as monitoring, inspection and punishment in cooperation with
pandemic management are also becoming more frequent.
6. The risk of goodwill impairments: On 31 December 2021, the book value of goodwill in consolidate financial
statement listed as 2,776 million Yuan, and distributed to the assets group of distribution division and retail
division. 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 III.-17 and 33, Note V-18
listed under the Section X. Financial Report
45
(iii) The company’s business plan
In 2022, Sinopharm Accord will continue to comprehensively strengthen the leadership of the party, accurately
grasp the new development stage, thoroughly implement the new development concept, and accelerate the
construction of a new development pattern. Taking high-quality development as the main line goal, guided by the
"14th Five-Year Plan" strategic plan, focusing on customer value, and taking "technological empowerment,
service upgrade, wholesale and retail integration, and industry-finance dual drive" as the core development
measures, we will build a "1-2-6" digital medical and healthcare service system based on omni-channel, full-
category, and full-life cycle., pay close attention to the development, changes and trends of the national medical
reform policy, strengthen the research and judgment of industry policy trends, coordinate efforts to ensure steady
growth, make structural adjustments, promote innovation, strengthen science and technology, and guard against
risks, and "seek change in stability" and "increase stability in change" to achieve high-quality development.
1. Put the emphasis on development of both internal growth and external expansion, and maintain a leading
position in the industry
Strengthen the guidance of strategic planning, while steadily developing traditional businesses, we will do a good
job in internal innovation and development and external M&A expansion to continuously increase market shares.
Strengthen the distribution segment and consolidate the leading position; expand the retail segment and improve
profitability.
2. Compare with first-class management improvement and enhance enterprise competitiveness
Make up for weakness, deepen organizational reform and management innovation, promote the modernization of
management capabilities and management systems, and improve support for strategy implementation and business
transformation. Focus on human resource efficiency and benefit goals, optimize the development of management,
talents, and organizations, and maintain a high matching rate and a high supply rate among talents, strategies, and
business. Customer-oriented, insist on management improvement and value creation. Focusing on customer needs
and combined with business scenarios to accelerate the application of big data, artificial intelligence and other
technologies, strengthen the promotion of digital transformation projects, and drive innovative services and supply
chain upgrades with digitization.
3. Adjust the structure to promote transformation and build a new value-driven business model
Grasp the changes in demand in the upstream and downstream of the industrial chain, focus on customer value
orientation, build an omni-channel, full-industry-chain, and full-life-cycle service system, and win development
opportunities in the innovative service track.
4. Distribution of Sinopharm Accord focuses on the strategy of "one body and two wings", and continues the
transformation, innovation and development
46
Strengthen strategic goal orientation, face changes, focus on share, and improve efficiency. Continue to develop
retail business, improve network, enrich varieties, coordinate wholesale and retail, and make characteristic
development, so as to strengthen and upgrade competitive advantages. Establish a marketing service system,
integrate wholesale and retail network resources, expand CSO product projects, promote marketing system and
team building, and improve the marketing service capabilities of medical institutions and end consumers.
Continue to promote business transformation and innovation, integrate digital transformation and supply chain
optimization into the business, and achieve model breakthrough and scale improvement of innovative business.
Provide comprehensive 4D overall service solutions to enhance integrated service capabilities; continue to expand
the leading advantages of SPD business, promote the upgrade of service platforms and operation and maintenance
capabilities; continue to promote the upgrade of value-added services of third-party logistics, and explore and
build warehouse distribution + cold chain + SPD+2C+ logistics service capability.
5. Guoda Drugstore quickly expands its scale, and digs deep into the market to improve efficiency
Strengthen strategic guidance, further increase regional business integration and accelerate the mergers and
acquisitions of intentional cooperation projects, enhance self-opening stores and franchise cooperation, accelerate
national retail layout, further fill blank markets, and expand new provincial-level market layouts. Continue to
promote the national integrated operation, enhance the advantages of economies of scale, and build the core
competitiveness of Guoda. Strengthen the online layout, focus on increasing the construction of self-operated
platforms and Internet hospitals, and explore the layout of commercial health insurance. Actively respond to the
"dual-channel" policy, and strive to achieve full coverage of dual-channel designated pharmacies in all provinces
and cities. Strengthen the breakthrough of all products and the combined action between purchase and sales,
systematically promote the improvement of gross profit margin, and continue to promote the development of its
own brand product series and the construction of marketing system. Promote the integration of retail brand
resources in an orderly manner, and strengthen the retail brand influence of "Guoda Drugstore". Continue to
promote digital transformation, and continuously improve professional service capabilities.
6. Promote the full coverage of wholesale and retail integration, and explore various models for operation
Continue to promote the fusion of wholesale and retail integration of Sinopharm Accord, in accordance with the
model of "one policy for one place, dynamic promotion" and based on the operation characteristics of various
regions, and output effective business models and profit models. On the basis of the original 15 pilot areas, add 13
areas to achieve full coverage of 28 areas across the country. Encourage regional exploration of business
integration, equity integration, organizational integration, membership stores and other model operations, and
continue to promote all-round coordination of wholesale and retail integration through business procurement
coordination, logistics coordination, combined action of retail equipment, and management coordination.
7. Guide by high-quality party building, and create a clean and positive development environment
47
Comprehensively strengthen the party's political and ideological building, and adhere to the integration of party
leadership and corporate governance. Deepen the construction of primary party organizations, and promote
comprehensive and strict governance of the party. Cultivate and create a warm, profound, broad and high
corporate culture that matches the development of the "14th Five-Year Plan" strategic plan of Sinopharm Accord
to help the development of the company.
XII. Reception of research, communication and interviews during the reporting period
√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
2021-04-12 Telephoning Institutions Institutions operation of the relations activities
Pharmacy Bldg.
Company (No.:2021-1)
Basic operating Resolution of the
Accord Institutions , situation of the Annual General
2021-04-28 Field research Institutions
Pharmacy Bldg. individual Company and Meeting 2020 (Notice
future outlook No.:2021-19)
Resolution of the First
Basic operating Extraordinary
Accord Institutions,
2021-06-25 Field research Institutions situation of the Shareholders’ General
Pharmacy Bldg. individual
Company Meeting of 2021
(Notice No.:2021-25)
Online collective
reception day for
Basic operating
investors of listed
Accord situation of the
2021-11-30 Other Individual Individual companies in Shenzhen
Pharmacy Bldg. Company and
2021
future outlook
https://rs.p5w.net/html/
130747.shtml
48
Section IV. 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 specialized 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 mechanism as Rules of Procedure of the Board and Measures for the Administration of
Related Transactions , 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 shareholder and the actual controller
in ensuring the Company’s assets, personnel, finance, organization and businesses
The Company totally separates from the controlling shareholders in business, personnel, assets, institutions,
financial and other aspects, with independent and complete self-management ability.
49
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 is in charge of the purchasing department and subordinate subsidiary; each segment is separated; 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
Types of Nature of
Name of Work schedule and follow-
Type affiliations with the Reason Solution measure
company up plan
listed companies company
Distribution subsidiary of In December 2016, On Juchao Website, the
Sinopharm Holding Sinopharm Holding Notice on Related
established some social issued a commitment Transactions of
Horizontal Controlling Sinopharm
SASAC retail pharmacy, which letter of avoiding Controlling Shareholders
competition shareholder Holding
might have horizontal horizontal competition Meet the Commitments and
competition with the with Sinopharm Solve the Horizontal
Guoda Drugstore, the Accord, and promise Competition Among Social
50
subordinate enterprise of to solve the horizontal Retail Pharmacy (Notice
the listed company after competition in respect No.: 2021-42) and the
restructuring of pharmaceutical Notice on Progress of
retail business in an Entering the Letter of
appropriate way Intent by Controlling
within five years since Subsidiary (Notice No.:
the date when 2022-05) were released by
reorganization the Company respectively
completed on December 31, 2021 and
March 25, 2021, matters
with horizontal
competition concerned are
continuing to be resolved.
On Juchao Website, the
Notice on Related
In December 2016, Transactions of
SINOPHARM issued Controlling Shareholders
a commitment letter of Meet the Commitments and
Distribution subsidiary of avoiding horizontal Solve the Horizontal
SINOPHARM established competition with Competition Among Social
some social retail Sinopharm Accord, Retail Pharmacy (Notice
pharmacy, which might and promise to solve No.: 2021-42) and the
Horizontal The actual SINOPHAR have horizontal the horizontal Notice on Progress of
SASAC
competition controller M competition with the competition in respect Entering the Letter of
Guoda Drugstore, the of pharmaceutical Intent by Controlling
subordinate enterprise of retail business in an Subsidiary (Notice No.:
the listed company after appropriate way 2022-05) were released by
restructuring within five years since the Company respectively
the date when on December 31, 2021 and
reorganization March 25, 2021, matters
completed with horizontal
competition concerned are
continuing to be resolved.
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
“Notice of
Annual General
AGM 64.31% April 28, 2021 April 29, 2021 Resolution of AGM
Meeting of 2020
of 2020” No.: 2021-
51
19
2021-25
“Notice of
First extraordinary
Extraordinary Resolution of First
general meeting of 63.27% June 25, 2021 June 26, 2021
general meeting extraordinary
2021
general meeting of
2021” No.: 2021-25
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
V. Directors, supervisors and senior officers
1. Basic information
Numbe Numbe
Numbe Reason
r of r of
Start Shares r of Shares s for
End shares shares
dated held at restricte Other held at increas
Workin date of Stock increas decreas
Name Title Sex Age of period- d changes period- e or
g status office options ed in ed in
office begin shares (share) end decreas
term this this
term (share) granted (share) e of
period period
(share) shares
(share) (share)
Chen Indepen Current April
Shengq dent ly in M 59 17, 1,500 0 0 0 0 0 1,500
un director office 2018
Deputy
GM,
Chen Current January
Secreta
Changb ly in M 54 13, 2,651 0 0 0 0 0 2,651
ry of
in office 2015
the
Board
Total -- -- -- -- -- -- 4,151 0 0 0 0 0 4,151 --
During the reporting period, whether there was any departure of directors and supervisors and dismissal of Senior Officers
√ Yes □ No
In March 2021, Mr. Li Dongjiu applied for resignation as director of 8th BOD, member of strategy committee of the Board and
member of legal & compliance committee of the Board due to the work adjustment.
In November 2021, Mr. Zhou Song applied for resignation as director of 9th BOD, member of risk internal control & auditing
committee of the Board and member of legal & compliance committee of the Board due to the work arrangement.
52
Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Title Type Date Reasons
Adjustment of work arrangement, and no longer serves as
Li Dongjiu Director Office leaving March 2, 2021
Director and other position of the Company
Zhao Xiaochuan Deputy GM Appointment May 21, 2021 Adjustment of work arrangement
Leaving at the
Jiang Xiuchang Director end of the term June 25, 2021 Change of Board of Directors
of office
Li Xiaojuan Director Be elected June 25, 2021 Change of Board of Directors
Zhou Song Director Be elected June 25, 2021 Change of Board of Directors
Leaving at the
September 30,
Liu Tianyao Deputy GM end of the term Leaving at the end of the term of office
2021
of office
November 3, Adjustment of work arrangement, and o longer serves as
Zhou Song Director Office leaving
2021 Director and other position of the Company
2. 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., and chairman of Sinopharm Holding Hong Kong Co., Ltd. and Sinopharm
53
CICC (Shanghai) Private Equity Investment Management Co., Ltd. Mr. Liu serves as Director of the 7th BOD of
the Company since January 2017 and Chairman of the 7th, 8th and 9th BOD of the Company since October 2017.
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
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 Sinopharm CICC
(Shanghai) Private Equity 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 and 9th BOD of the Company since April 2018.
Ms. Li Xiaojuan is the chief financial officer of Sinopharm Group Co., Ltd. From April 2001 to February 2005,
she successively served as the project manager of Beijing Tianhua Accounting Firm and the deputy director of the
strategic cooperation department of TOPSUN Group Co., Ltd.; from February 2005 to August 2010, she
successively served as the manager of the financial department, director of the auditing and supervisory office,
and manager of the audit department of China National Pharmaceutical Industry Co., Ltd.; from August 2010 to
February 2021, she successively served as deputy director of the investment management department, deputy
director and director of the audit department, and director of the finance department of Sinopharm; Chief
Financial Officer of the company; since March 2021, she serves as the chief financial officer of Sinopharm Group
Co., Ltd., and now concurrently serves as the president of Sinopharm Group Guizhou Co., Ltd. and Hutchison
Whampoa Sinopharm Pharmaceutical (Shanghai) Co., Ltd., and director of China National Medicines Corporation
Ltd., and Sinopharm Holding Hong Kong Co., Ltd., and she is a director of the ninth board of directors of the
company from June 2021.
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
54
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 Sinopharm CICC (Shanghai) Private Equity Investment Management
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 8th and 9th 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, 8th and 9th 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)
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. from March 2016
to September 2021. He served as deputy general manager of the Company since December 2008, from November
2020, he has been serving as a director of the 8th and 9th 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
and management 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 and Economic Management Department 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 7th, 8th and 9th board of directors of the Company.
55
Mr. Ou Yongliang, Practicing Lawyer of China, Vice President of Guangdong Province Law Society, the 8th and
9th vice president of All China Lawyers Association, the 9th and 10th president of Guangdong Lawyers Association,
director of Guangdong Hopesun Law Firm, chairman of Guangdong Public Welfare Foundation for Promoting
the Rule of Law, 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 Shanghai International Arbitration Commission, an arbitrator of the Shenzhen
International Arbitration Commission, an arbitrator of the Guangzhou Arbitration Commission. Since April 2018,
he has been serving as an independent director of the 8th and 9th 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
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 and 9th BOD of the Company since April 2018.
Ms. Su Weiwei: Doctor of pharmacy, secondary 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
secondary 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), owns 88 items with independent intellectual property rights. He serves as independent director of the
8th and 9th BOD of the Company since January 2019.
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
56
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 contact president of Shanghai Fosun Pharmaceutical (Group) Co., Ltd., the Co-Chairman and
President of generic drugs & manufacturing division, director of pharmaceutical business management committee,
and served as vice president of Fosun Pharmaceutical from June 2016 to October 2020, senior Vice President of
Fosun Pharmaceutical from October 2020 to January 2022; He has been the chairman of the board of supervisors
of the 8th and 9th 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,
8th and 9th 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 and director of legal compliance 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 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 and 9th 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. 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 January 2004 to September 2021; 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
57
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
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
November 1,
Liu Yong Sinopharm Group Co., Ltd Director, Y
2017
President
Deputy party
Liu Yong Sinopharm Group Co., Ltd January 1, 2018 Y
secretary
Deputy
Lian Wanyong Sinopharm Group Co., Ltd January 1, 2018 Y
President
58
Li Xiaojuan Sinopharm Group Co., Ltd CFO March 1, 2021 Y
Secretary of
Wu Yijian Sinopharm Group Co., Ltd January 1, 2019 Y
the Board
Director of
Liu Jingyun Sinopharm Group Co., Ltd Capital July 1, 2016 Y
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)
November 1,
Liu Yong China National Medicines Corporation Ltd. Director
2017
Sinopharm Holding Guoda Drugstore Co.,
Liu Yong Director October 1, 2017
Ltd.
China National Scientific Instruments & December 1,
Liu Yong Director
Materials Co., Ltd. 2018
China National Medical Equipment Co., December 1,
Liu Yong Director
Ltd. 2018
Sinopharm Holding Distribution Center Co., Executive
Liu Yong August 1, 2020
Ltd. Director
Liu Yong Sinopharm Holding Hong Kong Co., Ltd. Chairman January 1, 2021
Sinopharm CICC (Shanghai) Private Equity
Liu Yong Chairman January 1, 2021
Investment Management Co., Ltd.
December 1,
Lian Wanyong China National Medicines Corporation Ltd Director
2017
Sinopharm CICC (Shanghai) Private Equity
Lian Wanyong Director July 1, 2018
Investment Management Co., Ltd.
Lian Wanyong West China Dental Co., Ltd Director January 1, 2019
Lian Wanyong Sinopharm Holding Anhui Co., Ltd. Chairman January 1, 2019
Lian Wanyong Sinopharm Holding Changsha Co., Ltd. Chairman June 1, 2019
Lian Wanyong Sinopharm Holding Hubei Co., Ltd. Chairman January 1, 2020
Lian Wanyong Sinopharm Holding Hunan Co., Ltd. Director March 1, 2020
Sinopharm Holding Guzhou Mongolia Co.,
Li Xiaojuan Chairman April 1, 2021
Ltd.
59
Sinopharm Holding Hutchison Whampoa
Li Xiaojuan Chairman April 1, 2021
Pharmaceuticals (Shanghai) Co., Ltd.
Li Xiaojuan China National Medicines Corporation Ltd. Director April 1, 2021
Li Xiaojuan Sinopharm Holding Group H.K. Co., Ltd. Director June 1, 2021
Wu Yijian China National Shanxi Co., Ltd Chairman March 1, 2019
Wu Yijian Sinopharm Holding Shanxi Co., ltd Chairman March 1, 2019
Sinopharm Holding Inner Mongolia Co.,
Wu Yijian Chairman March 1, 2019
Ltd.
Sinopharm CICC (Shanghai) Private Equity
Wu Yijian Director March 1, 2019
Investment Management Co., Ltd.
Wu Yijian China National Health Online Co., Ltd. Chairman May 1, 2020
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
3. 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 2021 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
Post-holding Total Received
Name Title Sex (F/M) Age
status remuneration remuneration
60
before tax from related party
obtained from the of the Company
Company (Y/N)
Currently in
Liu Yong Chairman M 52 0Y
office
Jiang Xiuchang Director M 57 Office leaving 0Y
Currently in
Lian Wanyong Director M 51 0Y
office
Li Dongjiu Director M 56 Office leaving 0Y
Currently in
Li Xiaojuan Director F 45 0Y
office
Zhou Song Director M 39 离任 0Y
Currently in
Wu Yijian Director M 51 0Y
office
Currently in
Lin Zhaoxiong Director, GM M 54 250 N
office
Director, Party
Currently in
Lin Min Secretary, Deputy M 57 225 N
office
GM
Independent Currently in
Chen Honghui M 50 12 N
director office
Independent Currently in
Ou Yongliang M 52 12 N
director office
Independent Currently in
Chen Shengqun M 59 12 N
director office
Independent Currently in
Su Weiwei F 62 12 N
director office
Chairman of
Currently in
Wen Deyong supervisory M 50 0Y
office
committee
Currently in
Liu Jingyun Supervisor F 45 0Y
office
Currently in
Chen Guojing Staff supervisor F 51 83.78 N
office
Zhao Xiaochuan Deputy GM M 58 Office leaving 83.33 N
Liu Tianrao Deputy GM M 42 Office leaving 131.25 N
Currently in
Lin Xinyang Deputy GM M 57 175 N
office
61
Deputy party
secretary,
Secretary of
Currently in
Lang Baochun committee for M 58 175 N
office
discipline
inspection,
General counsel
Currently in
Gu Guolin CFO M 46 162.5 N
office
Deputy GM,
Currently in
Chen Changbin Secretary of the M 54 162.5 N
office
Board
Total -- -- -- -- 1,496.36 --
VI. Responsibility performance of directors during the reporting period
1. The board of directors during the reporting period
Session of meeting Date of meeting Disclosure date Meeting resolutions
Resolution announcement on
The 22th session of 8th board of
February 26, 2021 February 27, 2021 the 22th session of 8th board of
directors
directors
The 23th session of 8th board of Resolution announcement on
March 31, 2021 April 2, 2021
directors the board of directors
The 24th session of 8th board of Full text of the first quarter
April 23, 2021 April 24, 2021
directors report of 2021
Resolution announcement on
The 1st Extraordinary Meeting
the 1st Extraordinary Meeting of
of the 8th Board of Directors of May 21, 2021 May 22, 2021
the 8th Board of Directors of
2021
2021
Resolution announcement on
The 25th session of 8th board of
June 8, 2021 June 9, 2021 the 25th session of 8th board of
directors
directors
Resolution announcement on
The 1st session of 9th board of
July 16, 2021 July 17, 2021 the 1st session of 9th board of
directors
directors
Resolution announcement on
The 2nd session of 9th board of
August 13, 2021 August 17, 2021 semi-annual report of the board
directors
of directors
The 1st Extraordinary Meeting Resolution announcement on
September 30, 2021 October 8, 2021
of the 9 Board of Directors of
th
the 1st Extraordinary Meeting of
62
2021 the 9th Board of Directors of
2021
The 3rd session of 9th board of
October 19, 2021 October 20, 2021 Third Quarter Report of 2021
directors
Resolution announcement on
The 4th session of 9th board of
December 30, 2021 December 31, 2021 the 4th session of 9th
directors
Supervisory board
2. The attending of directors to Board meetings and shareholders general meeting
The attending of 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
Director supposed to entrusted the second shareholders
Presence communicatio Absence
attend in the presence time in a row general
n
report period (Y/N) meeting
Liu Yong 10 5 5 0 0 N 0
Jiang Xiuchang 5 2 3 0 0 N 0
Lian Wanyong 10 5 5 0 0 N 1
Li Dongjiu 1 1 0 0 0 N 0
Li Xiaojuan 5 3 2 0 0 N 0
Zhou Song 4 2 2 0 0 N 0
Wu Yijian 10 5 5 0 0 N 0
Lin Zhaoxiong 10 5 5 0 0 N 2
Lin Min 10 5 5 0 0 N 2
Chen Honghui 10 5 5 0 0 N 1
Ou Yongliang 10 5 5 0 0 N 1
Chen Shengqun 10 5 5 0 0 N 1
Su Weiwei 10 4 5 1 0 N 1
Explanation of absent the Board Meeting for the second time in a row
3. Objection for relevant events from directors
Directors come up with objection about Company’s relevant matters
□Yes √No
Directors have no objections for relevant events in reporting period
63
4. Other explanation about responsibility performance of directors
The opinions from directors have been adopted
√ Yes □ No
Explanation on advice that accepted/not accepted from directors
During the reporting period, directors of the Company performed their duties in a careful, diligent, dedicated
attitude in accordance with requirements of relevant laws, regulations and provisions, 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, Company directors played an important role in operation of specialized committee.
At the same time, the Company can guarantee Company directors of the same right to know. During the reporting
period, Company directors have no objection on the related issues of the Company.
VII. The specialized committees under the board during the reporting period
Important Specific
Number of Other
Committee Meeting comments and circumstances
Members meetings Date of meeting performance of
name content suggestions of the objection
held duties
made (if applicable)
1. Financial
Report of
2020;2.
Summary
Report on
Chen Ernst & Young
Shengqun CPA (Special
(convener), General
Risk Internal Chen Honghui, partnership)
Control and Ou Yongliang, Engaged in the
Audit Su Weiwei, 1 March 24, 2021 Auditing Work Consent
Committee of Jiang for year of
the Board Xiuchang, Lian 2020; 3.
Wanyong, Lin Proposal on
Zhaoxiong and Renewal of the
Lin Min Institution for
Annual Report
and Auditing of
Internal
Control for
year of 2021; 4.
64
Internal
control Self-
Assessment
Report 2020;
Sinopharm
Accord-Special
Report on the
Deposit and
Use of
Proceeds for
year of 2020.
Chen Honghui
Review the
(convener),
remuneration
Chen
Remuneration disclosed for
Shengqun, Ou
and Appraisal the directors,
Yongliang, Su 1 March 26, 2021 Consent
Committee of supervisors and
Weiwei, Liu
the Board senior
Yong, Jiang
executives for
Xiuchang and
year of 2020
Wu Yijian
After
reviewing, the
7 non-
Approved the independent
Su Weiwei
Proposal on directors of 9th
(convener),
Deliberation of BOD,
Nomination Chen
the nominated by
Committee of Shengqun, Ou 1 June 7, 2021
Qualification shareholders
the Board Yongliang, Liu
of Directors of and the 4
Yong and Lin
9th BOD of the independent
Zhaoxiong
Company directors of 9th
BOD,
nominated by
8th BOD, are
65
qualified to
serves as the
director of the
listed company.
VIII. 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.
IX. Particulars of workforce
1. Number of staff, professional composition and education background
The number of current employees of parent company at period-
120
end (people)
The number of current employees of main subsidiaries at period-
39,266
end (people)
Total number of current employees at period-end (people) 39,386
The total number of employees in payroll (people) 39,386
The total number of retired staff and workers that the parent
1,731
company and main subsidiaries need to bear the costs (people)
Professional composition
Category of professional composition Number of professional composition (people)
Production staff 20
Salesman 30,522
Technical staff 333
Financial staff 753
Administrative staff 150
Other 7,608
Total 39,386
Education background
Category of education Number (people)
Post-graduate qualification and above 192
Undergraduate 6,153
Junior college 15,254
College degree 17,787
Total 39,386
66
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 2021, the training work was
more proactive in promoting the transformation in terms of learning sharing, training empowerment and talent
development. With the headquarters as the hub, connected to the operation headquarters, and promoted the
integrated construction of the knowledge and experience sharing system and the training. In the form of training
programs, released the powerful driving force of the talent engine, improved organizational capabilities, and
accelerated the learning and sharing of organizational experience to enable high-quality development of business.
(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, designed and compiled the "2021 Sinopharm Accord Training Management Work Guide
Manual". For the first time, the manual integrates the past work experience of Sinopharm Accord’s training and
the follow-up work requirements into a standard work manual, which is shared with all staff training managers of
Sinopharm Accord to learn together, and serves as an important reference for HR lines and managers to promote
the training work.
(3) Accord headquarters united with the joint operation headquarters to organize offline training for new cadres of
Sinopharm Accord's "Dragon Cultivation Plan" in 2021. In this project, by combining the cultivating route of
67
"entering the model - role conversion - management improvement" with the training of "learning knowledge
online", communicating offline, training skills, post-training job transformation", accelerated the growth rate of
new cadres, accumulated talents for the company's long-term high-quality development, and increased strong
development momentum.
(4) Accord headquarters cooperated with the operation headquarters and subsidiaries, and launched the double-
excellent planner class PK competition with the theme of innovation. This competition covered all the staff of
Sinopharm Accord, with the goal of outputting high-quality innovative themed courseware and supporting
lecturers, the excellent innovative courses were disseminated and shared in the Accord system after the
competition, which was a large-scale event paving the way for the future planning of the internal trainer system in
the 14th Five-Year Plan. More than 220 people participated in the large-scale competition. After the competition,
the excellent participating lecturers were organized to give lessons.
(5) The human resource center united with the human resource department of the distribution operation
headquarters, the mixing cultivation project "Performance Improvement Project" that took "SPD business" as the
entry point, aimed at improving work related to "SPD business", and took "online learning, offline training,
practice after training" as the operation mode won the 2021 Performance Improvement Best Practice Award of the
International Society for Performance Improvement.
(6) Continued to promote online training. The "Sinopharm Online Learning" platform has opened more than 5,400
accounts, covering all subsidiaries across the country, and the average online learning hours of all employees
exceeds 33 hours.
4. Labor outsourcing
√ Applicable □ Not applicable
Total number of working hours of labor outsourcing (Hour) 3,489,048
Total remuneration paid of labor outsourcing (RMB) 85,338,901.00
X. Profit distribution plan and capitalizing of common reserves plan
Formulation, Implementation and Adjustment of Profit Distribution Policy Especially Cash Dividend policy during the Reporting
Period
√ Applicable □ Not applicable
On 28 April 2021, the profit distribution plan for year of 2020 was deliberated and approved by annual general
meeting of 2020, that is taking total 428,126,983 shares as base, distributed 8.00 yuan (tax included) for each 10
shares in cash. The announcement of 2020 interest distribution implementation was released on 11 June 2021 by
68
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 2020 was completed, and dividend for
public shares was distributed to the account of shareholders dated 21 June 2021 (A-share) and 23 June 2021 (B-
share) respectively.
Special explanation on cash dividend policy
Satisfy regulations of General Meeting or requirement of Article
Y
of Association (Y/N):
Well-defined and clearly dividend standards and proportion
Y
(Y/N):
Completed relevant decision-making process and mechanism
Y
(Y/N):
Independent directors perform duties completely and play a
Y
proper role (Y/N):
Minority shareholders have opportunity to express opinions and
Y
demands totally and their legal rights are fully protected (Y/N):
Condition and procedures are compliance and transparent while
Not applicable
the cash bonus policy adjusted or changed (Y/N):
The Company is profitable during the reporting period and the parent company has positive profit available for distribution to
shareholders without cash dividend distribution plan proposed
□ Applicable √ Not applicable
Profit distribution plan and capitalizing of common reserves plan for the Period
√ Applicable □ Not applicable
Number of bonus shares for each 10 shares (Share) 0
Number of dividends for each 10 shares (Yuan)(tax
6.00
included)
Number of conversions for each 10 shares (Share) 0.00
Base of the shares for the distribution (Share) 428,126,983
Cash dividend amount (Yuan) (tax included) 256,876,189.80
Amount of cash dividends by other ways (e.g.
0.00
share repurchased) (Yuan)
Total cash dividends (including other ways) (Yuan) 256,876,189.80
Distributable profit (Yuan) 6,499,660,099.63
Proportion of total cash dividends (including other
100%
ways) to the total profit distributed
Current cash dividend
If the Company is in a mature stage of development and has major capital expenditures arrangement, the minimum proportion of
cash dividend in the profit distribution should be 40% when carrying out the profit distribution
Explanation on the profit distribution plan for capital reserve transferring
69
XI. Implementation of the Company’s stock incentive plan, employee stock ownership plan or
other employee incentives
□ Applicable √ Not applicable
The Company has no equity incentive plan, employee stock ownership plans or other employee incentives.
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
During the reporting period, the company updated and improved the internal control system in accordance with
the guidelines of the Basic Norms for Enterprise Internal Control and combined with changes in the internal and
external environment, internal organizations and management requirements, and comprehensively sorted out and
revised the business processes of each link of the company, thereby making the internal control system more
perfect.
The company's risk internal control management system, which is composed of the risk and internal control audit
committee and the internal audit department, supervises and evaluates the company's internal control management.
The company's internal control can cover the main aspects of the company's operation and management, and there
are no major omissions; the units, businesses and matters and high-risk fields included in the evaluation scope
have covered the main aspects of the company's operation and management, and there are no major omissions; the
company's internal control design is sound , reasonable, the implementation of internal control has been basically
effective, and there are no major omissions.
Through the operation, analysis and evaluation of the internal control system, the company has effectively
prevented risks in operation and management and promoted the realization of the goal of internal control.
2. Details of major defects in IC appraisal report that found in reporting period
□Yes √ No
XIII. Management and controls on the subsidiary during reporting period
Problems
Name of Integration Follow-up
Integration plan encountered in Resolve progress
company progress Actions taken resolution plan
integration
N/A N/A N/A N/A N/A N/A N/A
70
XIV. Internal control self-assessment report or internal control audit report
1. Appraisal Report of Internal Control
Disclosure date of full internal control
March 30, 2022
evaluation report
Disclosure index of full internal control “Self-evaluation report of internal control for 2021 of China National Accord
evaluation report Medicines Corporation Ltd.” in Juchao website (http://www.cninfo.com.cn)
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 Non-financial report defects are
judged and decided by the degree of mainly judged and decided by the
influence and the likelihood of degree of influence and the
occurrence to the misstatements of likelihood of occurrence of defects to
financial reports caused by defects. the validity 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
that exists in internal control and may defects that may cause the
cause the material misstatements in enterprise’s serious deviation to
financial statements cannot be internal control objectives;
Qualitative criteria
prevented, found or corrected in time; (2) Major defects: a combination of
(2) Major defects: a combination of one or one or multiple internal control
multiple internal control defects that defects whose severity level and
exists in internal control and has lower economic consequences are lower
severity level than significant defects but than significant defects but still may
still should be concerned by the cause the enterprise’s deviation to
superintendents of enterprise financial internal 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 A quantitative criterion determines the
degree of importance of misstatements degree of importance of the company’s
Quantitative standard
(including missing reports) in the defects based on the amount of direct
consolidated statements of listed loss and the degree of significant
71
companies based on the consolidated influence to the company.
statement data. (1) Significant defects: the amount of
(1) Significant defects: equal to or direct property loss is or more than 10
greater than 5% of profit before tax; million Yuan, or has been officially
(2) Major defects: Between 1% and 5% of disclosed and caused negative effects
profit before tax; to periodic report disclosure of the
(3) Common defects: Less than or equal to joint-stock companies;
1% of profit before tax (2) Major defects: the amount of direct
property loss is between 5 million and
10 million Yuan, or has been punished
by the national government
departments but has not caused
negative effects to periodic report
disclosure of the joint-stock
companies;
(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 non-
0
financial reports
Amount of important defects in financial
0
reports
Amount of important defects in non-
0
financial reports
2. 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 2021
Disclosure details of audit report of
Disclosed
internal control
Disclosure date of audit report of
March 30, 2022
internal control (full-text)
72
Index of audit report of internal “Audit Report of Internal Control of China National Accord Medicines Corporation
control (full-text) 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
XV. Rectification of Self-examination Problems in Special Governance Actions in Listed
Company
According to the Opinions on Further Improving the Quality of Listed Companies (GF [2020] No.14) of the State
Council, since the company received the Notice of Shenzhen Securities Regulatory Bureau on Promoting the
Main Responsibility of Listed Companies in the Area Under Administration to Improve the Governance Level
and Achieve High Quality Development (SZJGSZ [2020] No.128) from the China Securities Regulatory
Commission Shenzhen Securities Regulatory Bureau, it conducted a serious self-examination of the company in
strict accordance with relevant laws and administrative regulations, such as the Company Law and the Securities
Law, as well as the Articles of Association, the Rules of Procedure for the General Meeting of Shareholders, the
Rules of Procedure of the Board of Directors, the Rules of Procedure of the Board of Supervisors and other
internal rules and regulations. The problems found in this self-examination and the rectification are as follows:
1. The company had a situation where there was no election at expiration of terms of office of the board of
directors.
Specific rectification: The term of office of the eighth board of directors and the eighth board of supervisors of the
company expired on April 17, 2021. On April 2, 2021, the company disclosed the "Indicative Announcement on
the Postponement of Election at Expiration of Term of Office of the Board of Directors and the Board of
Supervisors". On June 8, 2021, the company held the twenty-fifth meeting of the eighth board of directors and the
eighteenth meeting of the eighth board of supervisors, and held the first extraordinary general meeting of
shareholders in 2021 on June 25, 2021, at which the relevant proposals on the election of the ninth board of
directors and the board of supervisors of the company were reviewed and approved, and the election was
completed.
Completion time of of rectification: June 25, 2021
73
2. The company had a situation where the directors, supervisors and senior executives failed to attend (as non-
voting attendees) or entrust others to attend the general meeting of shareholders, the board of directors meeting,
the board of supervisors meeting and other meetings on their behalf as required.
Specific rectification: After the self-examination, the company's board office immediately reiterated to the
company's directors, supervisors and senior executives the regulatory requirements for holding a general meeting
of shareholders: "When the company holds a general meeting of shareholders, all directors, supervisors and the
secretary of the board shall attend the meeting, and managers and other senior executives shall attend the meeting
as nonvoting attendees.” The directors, supervisors and senior executives who were indeed unable to attend the
shareholders’ meeting due to the impact of the pandemic, the company will use IT technology (network video +
teleconference system, etc.) to provide positive conditions for directors, supervisors and senior executives to
communicate with shareholders in real time in different places, and provide greater convenience for them to
perform their duties.
Completion time of of rectification: April 28, 2021
Taking this self-examination and rectification activity as an opportunity, the company carefully organized the
directors, supervisors and senior executives to study the Opinions on Further Improving the Quality of Listed
Companies, keep the "Four Awes" in mind, adhere to the four bottom lines of "not disclosing false information,
not engaging in insider trading, not manipulating market prices, and not harming the interests of listed companies”.
In future, the company will conscientiously implement the rectification measures, effectively improve the
standard operation level and corporate governance effectiveness of state-controlled listed companies, and strive to
become a governance model for state-controlled listed companies.
74
Section V. Environmental and Social Responsibility
1. Major environmental
The listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection department
□Yes √ No
Administrative punishment for environmental problems during the reporting period
The impact on the
The Company's
Name of company or Reason for production and
Violation Punishment result rectification
subsidiary punishment operation of listed
measures
companies
N/A N/A N/A N/A N/A N/A
Other environmental information disclosed refer to key polluters
Qua
Name of ntity
Major of Approve Exces
Distribution of Emission Total
Company Pollutants Emission Disc Executed Pollutant Discharge d Total sive
Discharge Concentratio Emission
/subsidiary and Method harg Standards Emission Disch
Outlet n s
Particular e s arge
Pollutants Outl
et
Main Luck Discharge Standards of Water
Pharmaceuti Discharge Pollutants for Pharmaceutical
Nanotubes 0.030ton/ 0.12ton/y
cals COD 1 Outlet of 15mg/L industry Mixing/Compounding N/A
emissions year ear
Waste Water and Formulation Category -
GB21908-2008
Main Luck Discharge Standards of Water
Pharmaceuti Discharge Pollutants for Pharmaceutical
Ammonia Nanotubes 0.001ton/ 0.02ton/y
cals 1 Outlet of 0．5mg/L industry Mixing/Compounding N/A
Nitrogen emissions year ear
Waste Water and Formulation Category -
GB21908-2008
Main Luck Discharge Standards of Water
Pharmaceuti Discharge Pollutants for Pharmaceutical
Nanotubes 0.0001to 0.001ton/
cals Phosphate 1 Outlet of 0.05mg/l industry Mixing/Compounding N/A
emissions n/year year
Waste Water and Formulation Category -
GB21908-2008
Main Luck BOD Nanotubes 1 Discharge 5mg/L Discharge Standards of Water0.01ton/y 0.04ton/y N/A
75
Pharmaceuti emissions Outlet of Pollutants for Pharmaceutical ear ear
cals Waste Water industry Mixing/Compounding
and Formulation Category -
GB21908-2008
Main Luck Discharge Standards of Water
Pharmaceuti Discharge Pollutants for Pharmaceutical
Nanotubes 0.01ton/y 0.04ton/y
cals SS 1 Outlet of 5mg/L industry Mixing/Compounding N/A
emissions ear ear
Waste Water and Formulation Category -
GB21908-2008
Sinopharm
Grade -B (GB/T31962-2015)
Weiqida Discharge
Nanotubes in Wastewater Quality
Pharmaceuti COD 1 Outlet of 240.08㎎/L 717.16 2640 N/A
emissions Standards for Discharge to
cal Co., Ltd. Waste Water
Municipal Sewers
(District 1)
Sinopharm Grade -B (GB/T31962-2015)
Discharge
Weiqida Ammonia Nanotubes in Wastewater Quality
1 Outlet of 1.03㎎/L 3.13 350.7 N/A
Pharmaceuti Nitrogen emissions Standards for Discharge to
Waste Water
cal Co., Ltd. Municipal Sewers
(District 1)
Sinopharm
Grade -B (GB/T31962-2015)
Weiqida Discharge
Nanotubes in Wastewater Quality
Pharmaceuti COD 1 Outlet of 132.18㎎/L 199.97 1440 N/A
emissions Standards for Discharge to
cal Co., Ltd. Waste Water
Municipal Sewers
(District 2)
Sinopharm
Grade -B (GB/T31962-2015)
Weiqida Discharge
Ammonia Nanotubes in Wastewater Quality
Pharmaceuti 1 Outlet of 2.55㎎/L 3.27 256.5 N/A
Nitrogen emissions Standards for Discharge to
cal Co., Ltd. Waste Water
Municipal Sewers
(District 2)
Sinopharm
DB 14 ／ 1929-2019-
Weiqida
Exhaust Landmark of Emission
Pharmaceuti Particulates Organised 1 3.12㎎/m 1.98 19.683 N/A
exhaust port Standard of Air Pollutants for
cal Co., Ltd. emissions
Boiler
(District 2)
Sinopharm
DB 14 ／ 1929-2019-
Weiqida
Sulfur Exhaust Landmark of Emission
Pharmaceuti Organised 1 8.19㎎/m 5.41 68.733 N/A
dioxide exhaust port Standard of Air Pollutants for
cal Co., Ltd. emissions
Boiler
(District 2)
Sinopharm Nitrogen 1 Exhaust 19.02㎎/m DB 14 ／ 1929-2019- 13.95 101.88 N/A
76
Weiqida oxides Organised exhaust port Landmark of Emission
Pharmaceuti emissions Standard of Air Pollutants for
cal Co., Ltd. Boiler
(District 2)
China Table 2 in the Discharge
National Standard of Water Pollutants
Discharge
Zhijun Nanotubes for Pharmaceutical Industry
COD 1 Outlet of 24㎎/L 1.53120 5.3874 N/A
(Shenzhen) emissions Mixing/Compounding and
Waste Water
Pharmaceuti Formulation Category GB
cal Co., Ltd. 21908-2008
China Table 2 in the Discharge
National Standard of Water Pollutants
Discharge
Zhijun Ammonia Nanotubes for Pharmaceutical Industry
1 Outlet of 0.9269㎎/L 0.05910 0.8979 N/A
(Shenzhen) Nitrogen emissions Mixing/Compounding and
Waste Water
Pharmaceuti Formulation Category GB
cal Co., Ltd. 21908-2008
China Table 2 in the Discharge
National Standard of Water Pollutants
Discharge
Zhijun Total Nanotubes for Pharmaceutical Industry
1 Outlet of 0.04㎎/L 0.00260 N/A N/A
(Shenzhen) phosphorus emissions Mixing/Compounding and
Waste Water
Pharmaceuti Formulation Category GB
cal Co., Ltd. 21908-2008
China The more stricter standards
National between Water Pollutants for
Zhijun Pharmaceutical Industry
(Shenzhen) Mixing/Compounding and
Discharge
Pingshan Nanotubes Formulation Category (GB
COD 1 Outlet of 19.58㎎/L 1.376 2.628 N/A
Pharmaceuti emissions 21908-2008) and the IV-water
Waste Water
cal Co., Ltd. (Ammonia Nitrogen up to
grade V) in Environmental
Quality Standard for Surface
Water (GB3838-2002)
China The more stricter standards
National between Water Pollutants for
Zhijun Pharmaceutical Industry
(Shenzhen) Mixing/Compounding and
Discharge
Pingshan Ammonia Nanotubes Formulation Category (GB
1 Outlet of 0.211㎎/L 0.014 0.1752 N/A
Pharmaceuti Nitrogen emissions 21908-2008) and the IV-water
Waste Water
cal Co., Ltd. (Ammonia Nitrogen up to
grade V) in Environmental
Quality Standard for Surface
Water (GB3838-2002)
77
China The more stricter standards
National between Water Pollutants for
Zhijun Pharmaceutical Industry
(Shenzhen) Mixing/Compounding and
Discharge
Pingshan Total Nanotubes Formulation Category (GB
1 Outlet of 0.02㎎/L 0.0008 0.02628 N/A
Pharmaceuti phosphorus emissions 21908-2008) and the IV-water
Waste Water
cal Co., Ltd. (Ammonia Nitrogen up to
grade V) in Environmental
Quality Standard for Surface
Water (GB3838-2002)
Shanghai The Discharge Standard of
Tianwei Discharge Pollutants for Bio-
Nanotubes
Biopharmac COD 1 Outlet of 105.89mg/L pharmaceutical Industry 3.225 15.5382 N/A
emissions
eutical Co., Waste Water (DB31/373-2010)
Ltd.
Shanghai
The Discharge Standard of
Tianwei Discharge
Ammonia Nanotubes Pollutants for Bio-
Biopharmac 1 Outlet of 1.73mg/L 0.054 1.2012 N/A
Nitrogen emissions pharmaceutical Industry
eutical Co., Waste Water
(DB31/373-2010)
Ltd.
Shanghai
The Discharge Standard of
Tianwei Discharge
Total Nanotubes Pollutants for Bio-
Biopharmac 1 Outlet of 7.51mg/L 0.229 1.8263 N/A
nitrogen emissions pharmaceutical Industry
eutical Co., Waste Water
(DB31/373-2010)
Ltd.
Shanghai
The Discharge Standard of
Tianwei Discharge
Total Nanotubes Pollutants for Bio-
Biopharmac 1 Outlet of 0.72mg/L 0.024 0.238 N/A
phosphorus emissions pharmaceutical Industry
eutical Co., Waste Water
(DB31/373-2010)
Ltd.
Sinopharm Wastewater Quality Standards
Discharge
Chuankang Nanotubes for Discharge to Municipal
COD 1 Outlet of 62.28mg/L 1.1131 11.33 N/A
Pharmaceuti emissions Sewers (GB/T31962-2016)
Waste Water
cal Co., Ltd.
Sinopharm
Discharge Wastewater Quality Standards
Chuankang Ammonia Nanotubes
1 Outlet of 1.58mg/L for Discharge to Municipal 0.0283 1.02 N/A
Pharmaceuti Nitrogen emissions
Waste Water Sewers (GB/T31962-2016)
cal Co., Ltd.
Sinopharm Discharge Wastewater Quality Standards
Total Nanotubes
Chuankang 1 Outlet of 0.836mg/L for Discharge to Municipal 0.0149 0.181 N/A
phosphorus emissions
Pharmaceuti Waste Water Sewers (GB/T31962-2016)
78
cal Co., Ltd.
Jiangsu Integrated Wastewater
Discharge
Weiqida Nanotubes Discharge Standard (GB8978-
COD 1 Outlet of 287.78 32.38 46.82 N/A
Pharmaceuti emissions 1996)-Tertiary standards in
Waste Water
cal Co., Ltd. table-4
Jiangsu Integrated Wastewater
Discharge
Weiqida Ammonia Nanotubes Discharge Standard (GB8978-
1 Outlet of 2.87 0.31 4.21 N/A
Pharmaceuti Nitrogen emissions 1996)-Tertiary standards in
Waste Water
cal Co., Ltd. table-4
Jiangsu Integrated Wastewater
Discharge
Weiqida Total Nanotubes Discharge Standard (GB8978-
1 Outlet of 21.76 1.88 5.696 N/A
Pharmaceuti nitrogen emissions 1996)-Tertiary standards in
Waste Water
cal Co., Ltd. table-4
Jiangsu Integrated Wastewater
Discharge
Weiqida Total Nanotubes Discharge Standard (GB8978-
1 Outlet of 1.92 0.21 0.65 N/A
Pharmaceuti phosphorus emissions 1996)-Tertiary standards in
Waste Water
cal Co., Ltd. table-4
Sinopharm
Discharge
Yixin Nanotubes
COD 1 Outlet of 7.0145mg/L Protocol concentration 0.6192 2.44 N/A
Pharmaceuti emissions
Waste Water
cal Co., Ltd.
Sinopharm
Discharge
Yixin Ammonia Nanotubes
1 Outlet of 0.0706mg/L Protocol concentration 0.0058 0.39 N/A
Pharmaceuti Nitrogen emissions
Waste Water
cal Co., Ltd.
Sinopharm
Emission Standard of Air
Yixin Organised Exhaust
Nox 1 0.4123kg/h Pollutants for Boilers 2.8294 4.64 N/A
Pharmaceuti emissions exhaust port
(GB13271-2014)
cal Co., Ltd.
Shanghai
Indirect Discharge Standard of
Modern
Discharge Water Pollutants for
Hasen Nanotubes
COD 1 Outlet of 66.82mg/L Pharmaceutical Industry 13.9283 95.144 N/A
(Shangqiu) emissions
Waste Water Chemical Synthesis Products
Pharmaceuti
Category (DB41/756-2012)
cal Co., Ltd.
Shanghai
Indirect Discharge Standard of
Modern
Discharge Water Pollutants for
Hasen Ammonia Nanotubes
1 Outlet of 2.30mg/L Pharmaceutical Industry 0.50557 13.239 N/A
(Shangqiu) Nitrogen emissions
Waste Water Chemical Synthesis Products
Pharmaceuti
Category (DB41/756-2012)
cal Co., Ltd.
79
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 (and its
affiliates) 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 (and its
affiliates) 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 (and its
affiliates) 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.
Measures taken to reducing the carbon emissions during the reporting period and their effectiveness
√ Applicable □ Not applicable
(i) Promote the application of the "four new technologies".
1. The west wall of Zhanjiang Distribution Center of Guangdong Logistics is severely exposed to sunlight, the
temperature of warehouse increases after the wall absorbs heat, so the cooling intensity of the air-conditioning
unit increases. It is proposed to seal the wall with thermal insulation board to effectively cut off the heat transfer
of the wall and reduce the energy consumption of the air conditioner.
2. Most of the floors of the Gaotang warehouse are mainly made of steel frame structure and color steel plate, and
the warehouse has been in use for more than ten years, with the aging of materials, the insulation effect decreases,
resulting in increased energy consumption of warehouse air conditioning. It is proposed to paint a layer of thermal
insulation coating on the roof of the warehouse to effectively block the transfer of external heat, which can reduce
the indoor temperature of the warehouse by about 5-10 °C, achieving the goal of energy saving, environmental
protection and reducing electricity consumption.
3. Henan Guoda invested more than 300,000 yuan to replace the original 2 diesel transport vehicles with new
energy electric vehicles. The total mileage this year was about 25,810 kilometers, the total power consumption
80
was 14,450 kWh at a cost of about 14,450 yuan, converting comprehensive energy consumption of 1.77 tons.
Compared with diesel vehicles, the comprehensive energy consumption reduced by 2.34 tons on a year-on-year
basis, a decrease of about 57%, and saved cost of about 12,500 yuan.
(ii) Strengthen energy consumption management and control, economies go first
1. Reduce the cost of using the public vehicles. The official business vehicles shall be managed uniformly, and the
system of dispatching vehicles shall be reviewed and approved by the office, so as to reduce the number of
separate or repeated dispatching of vehicles, and private use of public vehicles is strictly prohibited. Strengthen
the management of vehicle use, and implement systems such as fixed-point refueling and single vehicle fuel
consumption registration. Minimize the loss caused by human factors as much as possible. In 2021, Sinopharm
Accord's vehicle fuel consumption dropped by 33.48 tons compared with the same period last year. The next step
is to focus on planning the monitoring of vehicle fuel consumption.
2. Strictly economize on electricity. The company starts from saving a kilowatt-hour of electricity to block the
waste loopholes. Firstly, strengthen the management of electrical equipment: when using office automation
equipment such as computers, printers, and copiers, it is required to minimize standby consumption. Secondly,
replace the passageway and corridor lighting with energy-saving lamps, and set time and voice control devices to
automatically turn on and off, which better put an end to the phenomenon of eternal lighting. Thirdly, add sponge
strips to all the windows to improve the tightness of doors and windows, and open the air conditioner seasonally
to save electricity.
3. Strengthen water conservation. Strengthen the daily maintenance and management of water equipment, get into
the habit of turning off the tap when leaving, prevent leakage, and better eliminate the phenomenon that the water
keeps running.
Reasons for not disclosing other environmental information
The above companies are all joint stock companies of the Company. Neither the company nor its holding
subsidiaries belong to the key pollutant discharge units announced by the environmental protection department.
II. Social Responsibility
“Social Responsibility Report of Sinopharm Accord in 2021” can be seen in Juchao website released on the same date
(http://www.cninfo.com.cn)
81
III. Consolidating and expanding the achievements of poverty alleviation and rural
revitalization
The Company has not carried out targeted poverty alleviation in the reporting period
82
Section VI. Important Events
I. 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
Commitment Commitment Commitment Implement
Promise by commitme Content of commitments
reason date term ation
nts
Share reform
commitment
""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 of shares of Sinopharm
Holding Guangzhou it held to
Commitments Commitme Sinopharm Accord, “1. it will not
Normally
in report of Sinopharm nt of newly-establish or broaden within Long-term
2005-06-21 implementi
acquisition or Holding shareholde Guangdong any business operation effective
ng
equity change rs that actually compete with that of
Sinopharm Accord, or set up any new
subsidiaries or subordinate enterprises
who engage in such business. 2. It will
enter into business delineation with
Sinopharm Accord and Sinopharm
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
83
enterprise that may compete with
Sinopharm Accord in the production
and R&D of pharmaceutical products.”
"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
Commitme
operate relevant businesses of
nts on
pharmaceutical industry, the main
horizontal
Commitments Sinopharm business will become the national Normally
competitio Long-term
in assets Group Co., pharmaceutical retail and 2016-12-28 implementi
n, relation effective
reorganization Ltd pharmaceutical distribution business in ng
transaction
Guangdong and Guangxi. In order to
and capital
support the business development of
occupation
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
84
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 Company by
Sinopharm Accord, taking the
entrusted operation, leasing or
contracting operation by Sinopharm
Accord and its controlling enterprises
in accordance with the methods
permitted to national laws to hold or
control the social retail drugstore
assets, or transferring the controlling
stake of the social retail drugstore
assets by the Company. 3. If the
shareholders of the social retail
drugstore assets (hereinafter referred
to as "the third party") of the Company
or the enterprises controlled by the
Company have or are going to perform
the preemptive rights under the same
conditions in accordance with relevant
laws and corresponding Articles of
Association, then the above
commitment will not be applicable,
but in this case, the Company should
try 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
85
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
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 issue date of this commitment
letter, the Company promises to
indemnify Sinopharm Accord for all
actual losses, damages and expenses
caused by the Company in violation of
any commitments under this
commitment letter. 6. This
commitment letter terminates when
following circumstances occur (subject
to the earlier one): (1) the Company is
no longer the controlling shareholder
of Sinopharm Accord; or (2) the shares
of Sinopharm Accord terminate the
listing at the stock exchange.”
“SINOPHARM made commitments in
the Report about China National
Commitme
Accord Medicines Corporation Ltd.
nts on
Purchasing Assets and Raising
horizontal
Supporting Funds and Related Normally
competitio Long-term
SINOPHARM Transactions by Asset Sale, Stock 2016-12-28 implementi
n, relation effective
Issuance and Cash Payment that the ng
transaction
Company shall be the actual controller
and capital
of China National Accord Medicines
occupation
Corporation Ltd. (hereinafter referred
to as Sinopharm Accord) up to the
86
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 not limited to
purchasing the social retail drugstore
assets subordinated to the Company by
Sinopharm Accord, taking the
entrusted operation, leasing or
contracting operation by Sinopharm
Accord and its controlling enterprises
in accordance with the methods
permitted to national laws to hold or
control the social retail drugstore
assets, or transferring the controlling
stake of the social retail drugstore
87
assets by the Company. 3. If the
shareholders of the social retail
drugstore assets (hereinafter referred
to as "the third party") of the Company
or the enterprises controlled by the
Company have or are going to perform
the preemptive rights under the same
conditions in accordance with relevant
laws and corresponding Articles of
Association, then the above
commitment will not be applicable,
but in this case, the Company should
try 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
opportunities to Sinopharm Accord or
its holding enterprises according to the
88
reasonable and fair terms and
conditions so as to avoid the horizontal
competition with Sinopharm Accord
and its holding enterprises. 5. This
commitment letter terminates when
following circumstances occur (subject
to the earlier one): (1) the Company is
no longer the actual controller of
Sinopharm Accord; or (2) the shares of
Sinopharm Accord terminate the
listing at the stock exchange.”
"Sinopharm Holding made
commitments in the Commitment
Letter About Sinopharm Group Co.,
Ltd. to Avoid Horizontal Competition:
“First, the Company and the
Company’s wholly-owned, controlling
or other enterprises with actual control
(in addition to Sinopharm Accord and
Controlling
its controlling enterprises, hereinafter
shareholder
the same) don’t have businesses and
is
operations constituting the substantial
implement
horizontal competition to Sinopharm
in real
Accord and its controlling enterprises.
earnest,
Second, the Company and the
Sinopharm
Commitments Company’s wholly-owned, controlling
Commitme Accord
make in initial or other enterprises with actual control
Sinopharm nt of Long-term will
public shall not engage, participate in or do 2013-09-05
Holding shareholde effective actively
offering or re- businesses and activities in
rs urged the
financing Guangdong and Guangxi which
controlling
constitute substantial competition to
shareholder
Sinopharm Accord and pharmaceutical
and actual
business services. Third, the Company
controller
and the Company’s wholly-owned,
to fulfill
controlling or other enterprises with
commitme
actual control shall not engage,
nts
participate in or do businesses and
activities which constitute substantial
competition to Sinopharm Accord and
pharmaceutical industry businesses.
Fourth, the Company shall not take
advantage of the control to Sinopharm
Accord to damage the legitimate rights
and interests of Sinopharm Accord and
89
other shareholders (especially medium
and small shareholders). This
commitment letter takes effect 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.”
"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
controlling Sinopharm Accord, the
shareholder
Company and the companies and
is
enterprises directly and indirectly
implement
controlled by the Company (“related
in real
party” for short) will strictly regulate
earnest,
the related transactions with
Sinopharm
Sinopharm Accord and its controlling
Commitme Accord
enterprises. Second, for the related
Sinopharm nt of Long-term will
transactions that can not be avoided 2013-09-05
Holding shareholde effective actively
nor have reasonable reasons to occur,
rs urged the
the Company and related party shall
controlling
sign normative related transaction
shareholder
agreement in accordance with relevant
and actual
laws with Sinopharm Accord.
controller
Sinopharm Accord implements the
to fulfill
approval procedures and fulfills the
commitme
information disclosure obligations of
nts
the related transactions according to
relevant laws, regulations, rules, other
normative documents and the
constitutions of Sinopharm Accord.
Third, for the related transactions that
can not be avoided or have reasonable
reasons to occur, the Company and
90
related party shall abide by the open,
fair and just market principles and
confirm the price of related
transactions in accordance with the
price that the independent third party
without association sets for the same
and similar transactions, and ensure
the fairness of the price of the related
transactions. Fourth, when the board of
directors and the general meeting of
stockholders of Sinopharm Accord
vote on the related transactions
involving the Company and other
enterprises controlled by the Company,
the Company shall fulfill the necessary
obligations that the associated
directors and associated shareholders
abstain from voting in accordance with
the relevant provisions, and abide by
the legal procedures for approving
related transactions and the
information disclosure obligations.
Fifth, the Company guarantees to
participate in the shareholders' general
meeting, equally exercise the
corresponding rights and take the
corresponding obligations in
accordance with the constitutions of
Sinopharm Accord, not to take
advantage of controlling shareholder
status to seek improper benefits or
utilize related transactions to illegally
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 controlling
shareholder or its related party of
Sinopharm Accord. Within the
91
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.”
""SINOPHARM made commitments
in the Commitment Letter About
China National Pharmaceutical Group
Corporation to Avoid Horizontal
Competition with China National
Accord Medicines Corporation Ltd.:
“First, in the next five years,
Sinopharm plans to take appropriate
measures (including assets
replacement or acquisition, equity
reorganization, etc.) to resolve the Actual
horizontal competition between Controller
Sinopharm Weiqida and Sinopharm is
Accord. Second, in addition to the past implement
matters and matters disclosed in this in real
commitment letter, the Company and earnest,
the Company’s wholly-owned, Sinopharm
controlling or other enterprises with Accord
Commitme
actual control rights (except for Long-term will
SINOPHARM nt of actual 2013-10-16
Sinopharm Accord and its controlling effective actively
controller
enterprises, the same as below) shall urged the
not directly engaged in, participate in controlling
or do the businesses an activities shareholder
constituting actual competition to the and actual
production and operation of controller
Sinopharm Accord in China. The to fulfill
relevant commitments about avoiding commitme
horizontal competition that the nts
Company made in the past still remain
in effect. Third, the Company shall not
take advantage of the control
relationship to Sinopharm Accord to
damage the legitimate rights and
interests of Sinopharm Accord and its
shareholders (especially the medium
and small shareholders). Fourth, this
commitment letter comes into force
from the issue date and remains in
92
effect for the entire period when the
Company acts as the controlling
shareholder or its related party of
Sinopharm Accord.”
"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 Actual
Sinopharm Accord and its controlling Controller
enterprises. Second, for the related is
transactions that can not be avoided or implement
have reasonable reasons to occur, the in real
Company and related party shall sign earnest,
normative related transaction Sinopharm
agreement in accordance with relevant Accord
Commitme
laws with Sinopharm Accord. Long-term will
SINOPHARM nt of actual 2013-09-22
Sinopharm Accord implements the effective actively
controller
approval procedures and fulfills the urged the
information disclosure obligations of controlling
the related transactions according to shareholder
relevant laws, regulations, rules, other and actual
normative documents and the controller
constitutions of Sinopharm Accord. to fulfill
Third, for the related transactions that commitme
can not be avoided or have reasonable nts
reasons to occur, the Company and
related party shall abide by the open,
fair and just market principles and
confirm the price of related
transactions in accordance with the
price that the independent third party
without association sets for the same
and similar transactions, and ensure
the fairness of the price of the related
transactions. Fourth, when the board of
directors and the general meeting of
93
stockholders of Sinopharm Accord
vote on the related transactions
involving the Company and other
enterprises controlled by the Company,
the Company shall fulfill the necessary
obligations that the associated
directors and associated shareholders
abstain from voting in accordance with
the relevant provisions, and abide by
the legal procedures for approving
related transactions and the
information disclosure obligations.
Fifth, the Company guarantees not to
take advantage of actual controller
status to seek improper benefits or
utilize related transactions to illegally
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.
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
II. Non-operational fund occupation from controlling shareholders and its related party
√Applicable □Not applicable
94
Total Balance as
New funds
Sharehol Duration amount of the date Reimburse Reimburs Repayme
occupied in
ders or Type of for Opening reimburse Closing when ment ement nt time
Causes the
related related occupyi amount d in the amount annual method amount expected
reporting
party ng reporting report expected expected (Month)
period
period disclosed
Sinopha
rm
Zhijun
(Suzhou Jan. of
Entruste
) Other 2018 - 4,633.42 0.00 0.00 4,633.42 4,633.42 Other
d loan
Pharmac present
eutical
Co.,
Ltd.
Total 4,633.42 0.00 0.00 4,633.42 4,633.42 -- --
Total value at end of the period as a
percentage of the latest audited net 0.31%
assets
The “proposal on continue to provide entrusted loans to Sinopharm Zhijun (Suzhou)
Relevant decision procedures Pharmaceutical Co., Ltd.” was deliberated and approved by 29th session of 7th BOD dated
January 26, 2018
Explanation on reasons for new
occupation of non-operation funds by
controlling shareholders and its
related parties in the period, Not applicable
prosecution of those responsible and
measures proposed by the Board
Sinopharm Zhijun (Suzhou) Pharmaceutical Co., Ltd failed to collected the entrusted loans
Explanation on reasons for failure to
overdue, on May 11, 2021, the Court ruled that Sinopharm Zhijun (Suzhou) Pharmaceutical
pay off the occupation of non-
Co., Ltd was bankrupt and designated local government as the bankruptcy administration. At
operation funds as schedule,
present, the matter is in the stage of declaration of claim filing, and the Company has made a
prosecution of those responsible and
full provision for bad debts on the entrusted loan due to the principle of prudence.
measures proposed by the Board
Specif audit opinion of the fund Found more in the “Explanation on Fund Occupation by Controlling Shareholders and its
occupation by CPA Related Parties for year of 2021” released on March 30, 2022
Reasons for the inconsistency
between the non-operation fund
occupation by controlling Not applicable
shareholders and its related parties
disclosed in Annual Report and the
95
Specific Audit Opinion
III. External guarantee out of the regulations
□ Applicable √ Not applicable
No external guarantee out of the regulations occurred in the period.
IV. Statement on the latest “modified audit report” by BOD
□ Applicable √ Not applicable
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable √ Not applicable
VI. Explanation of the changes in accounting polices, accounting estimates or correction of
significant accounting errors compared with the financial report of the previous year
□ Applicable √ Not applicable
The Company had no changes in accounting policies, accounting estimates or correction of significant accounting errors during the
reporting period.
VII. 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 X. Financial Report.
VIII. 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
621.48
Yuan)
Continuous life of auditing service for domestic accounting firm 6
Name of domestic CPA Deng Dongmei, Li Yuanfen
96
Continuous life of CPA from the domestic accounting firm for
Deng Dongmei (1 year), Li Yuanfen (3 years)
auditing service
Name of foreign accounting firm (if applicable) N/A
Continuous life of auditing service for foreign accounting firm (if
N/A
applicable)
Name of foreign CPA (if applicable) N/A
Continuous life of auditing service for foreign CPA (if
N/A
applicable)
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 1,120,982.00 yuan.
IX. Particular about delisting after annual report disclosed
□ Applicable √ Not applicable
X. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period.
XI. Significant litigation and arbitration of the Company
□ Applicable √ Not applicable
No significant litigation and arbitration occurred in the reporting period.
XII. Penalty and rectification
□ Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.
XIII. Integrity of the company and its controlling shareholders and actual controllers
√Applicable □Not applicable
97
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
XIV. Major related transaction
1. Related transaction with routine operation concerned
√ Applicable □ Not applicable
Wheth
Availabl
Percentag Trading er over Clearin
e similar
Type Pricin Price (in Amount e of the amount the g form
market Date of Index of
Related Relatio of Conte g 10 (in 10 amount approved approv for
price(in disclos disclosure
party nship transac nt princip thousand thousand in similar (in 10 ed related
10 ure 引
tion les yuan) yuan) transactio thousand limited transacti
thousand
ns yuan) or not on
yuan)
(Y/N)
Has
Sinophar
the Cash Juchao
m
same Purcha Purcha and Website:
Holding Marke 105,178.0 105,178.0 105,178. 2021-
control sing of sing of 1.65% 160,000 N notes Notice
Distributi t price 2 2 02 04-02
ling goods goods settleme No.:
on Center
shareh nt 2021-09
Co., Ltd.
older
Has
China
the Cash Juchao
National
same Purcha Purcha and Website:
Medicine Marke 75,120.4 2021-
control sing of sing of 75,120.40 75,120.40 1.18% 90,000 N notes Notice
s t price 0 04-02
ling goods goods settleme No.:
Corporati
shareh nt 2021-09
on Ltd
older
180,298.4
Total -- -- -- 250,000 -- -- -- -- --
2
Detail of sales return with major
N/A
amount involved
The related transactions are settled by cash and note, according to the “proposal on prediction of
the routine related transactions between the Company and its subsidiaries and related parties for
Report the actual implementation
year of 2021” deliberated and approved by 23rd session of 8th BOD held on March 31, 2021, and
of the day-to-day related
the “Notice on Prediction of Routine Related Transactions in 2021”(Notice No.: 2021-09) released
transactions which were projected
on April 2, 2021, during the reporting period, sales of goods from related parties accounted for
about their total amount by types
67.27% of the amount predicted for the whole year; purchasing of goods from related parties
during the reporting period (if
accounted for 76.87% of the amount predicted for the whole year; the rental income of houses and
applicable)
equipment from related parties accounted for 38.66% of the amount predicted for the whole year;
the expenditure of leasing for houses and equipment from related parties accounted for 79.24% of
98
the amount predicted for the whole year; the labor services provided from related parties accounted
for 68.46% of the amount predicted for the whole year; the labor service received by related parties
accounted for 36.20% of the amount predicted for the whole year and total other vary related
transactions accounted for 74.91% of the amount predicted for the whole year.
Reasons for major differences
between trading price and market Not applicable
reference price (if applicable)
2. Related transactions by assets acquisition and sold
□ Applicable √ Not applicable
No related party transactions by assets acquisition and sold for the Company in Period.
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. Contact with the related finance companies
√ Applicable □ Not applicable
Deposit business
Amount for the Period
Maximum The total
Opening Total deposit Ending
daily deposit Deposit interest amount
Related party Relationship balance (in 10 amount for the Balance (10
limit (in 10 rate range withdrawn in
thousand yuan) Period (10 thousand yuan)
thousand yuan) the Period (10
thousand yuan)
thousand yuan)
China National The same
Finance ultimate
30,000 0.35%-1.89% 10,177.99 213,307.07 223,287.62 197.44
Corporation controlling
Ltd shareholder
99
Loan business
Amount for the Period
Total
Opening Total loan Ending
Loan line (10 Loan interest repayment
Related party Relationship Balance (10 amount for the Balance (10
thousand yuan) rate range amount for the
thousand yuan) Period (10 thousand yuan)
Period (10
thousand yuan)
thousand yuan)
China National The same
Finance ultimate
100,000 3.50%-3.70% 1,432.28 130,884.13 123,089.04 9,227.37
Corporation controlling
Ltd shareholder
Credit extension or other financial business
Total amount ( 10 Actual amount ( 10
Related party Relationship Type of business
thousand yuan) thousand yuan)
China National Finance The same ultimate Credit
100,000 130,884.13
Corporation Ltd controlling shareholder
China National Finance The same ultimate Bank acceptance bill
87,693.77 87,693.77
Corporation Ltd controlling shareholder discount
China National Finance The same ultimate
Entrusted loan 3,160 3,160
Corporation Ltd controlling shareholder
6. Transactions between the finance company controlled by the Company and related parties
□ Applicable √ Not applicable
There are no deposits, loans, credits or other financial business between the finance companies controlled by the Company and
related parties
7. Other major related transactions
□ Applicable √ Not applicable
No other major related party transactions occurred in the period.
XV. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
100
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
In 10 thousand Yuan
Particulars about the external guarantee of the Company and the subsidiaries (Barring the guarantee for subsidiaries)
Related Guarante
Collat Counter-
Name of the Announcem Actual date Actual Imple e for
Guarant Guarant eral (if guarantee Guarantee
Company ent of guarantee mented related
ee limit ee type applic situation (if term
guaranteed disclosure happening limit (Y/N) party
able) applicable)
date (Y/N)
Not applicable
Guarantee between the Company and the subsidiaries
Related Guarante
Collat Counter-
Name of the Announcem Actual date Actual Imple e for
Guarant Guarant eral (if guarantee Guarantee
Company ent of guarantee mented related
ee limit ee type applic situation (if term
guaranteed disclosure happening limit (Y/N) party
able) applicable)
date (Y/N)
Sinopharm Joint
Holding April 2, May 20, liability 2021.05.20-
30,000 30,000 N Y
Guangzhou 2021 2021 assuranc 2022.05.20
Co., Ltd. e
Sinopharm Joint
Holding April 2, May 10, liability 2021.05.10-
70,000 37,572.58 N Y
Guangzhou 2021 2021 assuranc 2022.05.09
Co., Ltd. e
101
Sinopharm Joint
Holding April 2, December liability 2021.12.27-
50,000 3,677.27 N Y
Guangzhou 2021 27, 2021 assuranc 2022.12.26
Co., Ltd. e
Sinopharm Joint
Holding April 2, June 28, liability 2021.06.28-
15,000 N Y
Guangzhou 2021 2021 assuranc 2022.06.27
Co., Ltd. e
Sinopharm Joint
Holding April 2, May 20, liability 2021.05.20-
95,000 60,959.61 N Y
Guangzhou 2021 2021 assuranc 2022.05.20
Co., Ltd. e
Sinopharm Joint
Holding April 2, July 14, liability 2021.07.14-
15,000 2,992.12 N Y
Guangzhou 2021 2021 assuranc 2022.07.13
Co., Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
20,000 1,924.47 N Y
Guangzhou 2021 2021 assuranc 2022.10.19
Co., Ltd. e
Sinopharm Joint
Holding April 2, September liability 2021.09.23-
42,000 N Y
Guangzhou 2021 23, 2021 assuranc 2022.09.23
Co., Ltd. e
Sinopharm
Joint
Holding
April 2, May 20, liability 2021.05.20-
Guangdong 5,000 4,396.63 N Y
2021 2021 assuranc 2022.05.20
Yuexing Co.,
e
Ltd.
Sinopharm
Joint
Holding
April 2, October 20, liability 2021.10.20-
Guangdong 12,000 10,563.1 N Y
2021 2021 assuranc 2022.10.19
Yuexing Co.,
e
Ltd.
Sinopharm
Joint
Holding
April 2, May 10, liability 2021.05.10-
Guangdong 15,000 7,127.6 N Y
2021 2021 assuranc 2022.05.09
Yuexing Co.,
e
Ltd.
Sinopharm Joint
April 2, December 1, 2021.12.01-
Holding 3,000 2,879.59 liability N Y
2021 2021 2022.11.30
Guangdong assuranc
102
Yuexing Co., e
Ltd.
Sinopharm
Joint
Holding
April 22, November liability 2020.11.20-
Guangdong 5,000 210.07 N Y
2020 20, 2020 assuranc 2021.11.19
Yuexing Co.,
e
Ltd.
Sinopharm
Joint
Holding
April 2, October 22, liability 2021.10.22-
Guangdong 15,000 2,674.29 N Y
2021 2021 assuranc 2022.10.22
Hengxing
e
Co., Ltd.
Sinopharm
Joint
Holding
April 2, April 28, liability 2021.04.28-
Guangdong 3,000 45.09 N Y
2021 2021 assuranc 2022.04.27
Hengxing
e
Co., Ltd.
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
500 77.02 N Y
Foshan Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Sinopharm Joint
Holding April 2, May 10, liability 2021.05.10-
2,000 180.21 N Y
Foshan Co., 2021 2021 assuranc 2022.05.10
Ltd. e
Sinopharm Joint
Holding April 22, March 23, liability 2021.03.23-
2,500 22.44 N Y
Foshan Co., 2020 2021 assuranc 2022.03.22
Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
2,500 997.87 N Y
Zhaoqing Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.06.01-
2,000 June 1, 2021 593.32 N Y
Zhaoqing Co., 2021 assuranc 2022.05.11
Ltd. e
Sinopharm Joint
Holding April 2, June 30, liability 2021.06.30-
3,000 99.39 N Y
Zhaoqing Co., 2021 2021 assuranc 2022.06.29
Ltd. e
103
Guangdong
Nanfang Joint
Pharmaceutic April 2, liability 2021.07.01-
19,500 July 1, 2021 12,633.74 N Y
al Foreign 2021 assuranc 2022.06.30
Trade Co., e
Ltd.
Guangdong
Nanfang Joint
Pharmaceutic April 2, October 13, liability 2021.10.13-
15,000 4,137 N Y
al Foreign 2021 2021 assuranc 2022.10.12
Trade Co., e
Ltd.
Guangdong
Nanfang Joint
Pharmaceutic April 2, December 5, liability 2021.12.05-
10,000 1,132.07 N Y
al Foreign 2021 2021 assuranc 2022.11.18
Trade Co., e
Ltd.
Foshan Joint
Nanhai April 2, October 20, liability 2021.10.20-
1,500 270.56 N Y
Medicine Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Foshan Joint
Nanhai April 22, March 22, liability 2021.03.22-
10,000 2,236.08 N Y
Medicine Co., 2020 2021 assuranc 2022.03.21
Ltd. e
Foshan Joint
Nanhai April 22, March 1, liability 2021.03.01-
7,000 N Y
Medicine Co., 2020 2021 assuranc 2022.02.28
Ltd. e
Foshan Joint
Nanhai April 2, September liability 2021.09.10-
2,500 923 N Y
Medicine Co., 2021 10, 2021 assuranc 2022.09.10
Ltd. e
Foshan
Joint
Nanhai
April 2, June 24, liability 2021.06.24-
Medicine Co., 3,000 2,579.02 N Y
2021 2021 assuranc 2022.05.11
Ltd.
e
Foshan Joint
April 2, October 20, 2021.10.20-
Nanhai 2,000 80.76 liability N Y
2021 2021 2022.10.19
Uptodate & assuranc
104
Special e
Medicines
Co. Ltd.
Foshan
Nanhai Joint
Uptodate & April 22, March 22, liability 2021.03.22-
10,000 3,702.73 N Y
Special 2020 2021 assuranc 2022.03.21
Medicines e
Co. Ltd.
Foshan
Nanhai Joint
Uptodate & April 22, March 1, liability 2021.03.01-
7,000 N Y
Special 2020 2021 assuranc 2022.02.28
Medicines e
Co. Ltd.
Foshan
Nanhai Joint
Uptodate & April 2, September liability 2021.09.10-
2,500 N Y
Special 2021 10, 2021 assuranc 2022.09.10
Medicines e
Co. Ltd.
Foshan
Nanhai Joint
Uptodate & April 2, June 24, liability 2021.06.24-
3,000 N Y
Special 2021 2021 assuranc 2022.05.11
Medicines e
Co. Ltd.
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
1,500 716.46 N Y
(Jiangmen) 2021 2021 assuranc 2022.10.19
Co., Ltd. e
Sinopharm Joint
Holding April 2, May 26, liability 2021.05.26-
5,000 3,866.04 N Y
(Jiangmen) 2021 2021 assuranc 2022.05.11
Co., Ltd. e
Sinopharm Joint
Holding April 2, May 31, liability 2021.05.31-
4,000 280.9 N Y
(Jiangmen) 2021 2021 assuranc 2022.05.31
Co., Ltd. e
Sinopharm Joint
April 2, October 20, 2021.10.20-
Holding 1,000 999.87 liability N Y
2021 2021 2022.10.19
Meizhou Co., assuranc
105
Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.06.03-
5,000 June 3, 2021 4,526.57 N Y
Meizhou Co., 2021 assuranc 2022.05.11
Ltd. e
Sinopharm Joint
Holding April 2, June 21, liability 2021.06.21-
6,000 1,420.43 N Y
Meizhou Co., 2021 2021 assuranc 2022.03.19
Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
1,000 600 N Y
Zhongshan 2021 2021 assuranc 2022.10.19
Co., Ltd. e
Sinopharm Joint
Holding April 2, August 17, liability 2021.08.17-
2,000 370 N Y
Zhongshan 2021 2021 assuranc 2022.08.16
Co., Ltd. e
Sinopharm Joint
Holding April 2, May 26, liability 2021.05.26-
3,000 2,232.21 N Y
Zhongshan 2021 2021 assuranc 2022.05.11
Co., Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
500 500 N Y
Shantou Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Sinopharm Joint
Holding April 2, October 21, liability 2021.10.21-
3,000 1,000 N Y
Shantou Co., 2021 2021 assuranc 2022.06.28
Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.06.03-
2,000 June 3, 2021 800.27 N Y
Shantou Co., 2021 assuranc 2022.05.11
Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
1,000 652.69 N Y
Huizhou Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Sinopharm Joint
Holding April 22, October 20, liability 2020.10.20-
3,000 25.63 N Y
Huizhou Co., 2020 2020 assuranc 2021.10.19
Ltd. e
106
Sinopharm Joint
Holding April 2, liability 2021.06.03-
4,000 June 3, 2021 2,145.87 N Y
Huizhou Co., 2021 assuranc 2022.05.11
Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
2,000 1,935 N Y
Zhanjiang 2021 2021 assuranc 2022.10.19
Co., Ltd. e
Sinopharm Joint
Holding April 2, October 25, liability 2021.10.25-
5,000 1,816.38 N Y
Zhanjiang 2021 2021 assuranc 2022.10.24
Co., Ltd. e
Sinopharm Joint
Holding April 2, May 19, liability 2021.05.19-
8,000 4,630.48 N Y
Zhanjiang 2021 2021 assuranc 2022.05.19
Co., Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
1,000 1,000 N Y
Zhuhai Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.07.08-
3,000 July 8, 2021 2,125.8 N Y
Zhuhai Co., 2021 assuranc 2022.07.07
Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.06.01-
4,000 June 1, 2021 3,994.07 N Y
Zhuhai Co., 2021 assuranc 2022.05.11
Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.07.01-
4,000 May 1, 2021 N Y
Zhuhai Co., 2021 assuranc 2022.04.28
Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
2,000 1,527.79 N Y
Dongguan 2021 2021 assuranc 2022.10.19
Co., Ltd. e
Sinopharm Joint
Holding April 2, liability 2021.06.03-
3,000 June 3, 2021 1,075.81 N Y
Dongguan 2021 assuranc 2022.05.11
Co., Ltd. e
Sinopharm April 2, 5,000 July 1, 2021 1,851.53 Joint 2021.07.01- N Y
107
Holding 2021 liability 2022.02.27
Dongguan assuranc
Co., Ltd. e
Guangdong
Joint
Dongfang
April 2, May 10, liability 2021.05.10-
New Special 10,000 7,373.5 N Y
2021 2021 assuranc 2022.05.09
Medicine Co.,
e
Ltd
Guangdong
Joint
Dongfang
April 2, April 2, liability 2021.04.02-
New Special 5,000 4,998.57 N Y
2021 2021 assuranc 2022.04.01
Medicine Co.,
e
Ltd
Guangdong
Joint
Dongfang
April 2, July 13, liability 2021.07.13-
New Special 3,000 2,860.13 N Y
2021 2021 assuranc 2022.07.12
Medicine Co.,
e
Ltd
Guangdong
Joint
Dongfang
April 2, October 13, liability 2021.10.13-
New Special 9,000 7,444.06 N Y
2021 2021 assuranc 2022.10.12
Medicine Co.,
e
Ltd
Guangdong
Joint
Dongfang
April 2, October 20, liability 2021.10.20-
New Special 4,000 3,999.1 N Y
2021 2021 assuranc 2022.10.19
Medicine Co.,
e
Ltd
Guangdong
Dongfang Joint
New Special April 2, August 19, liability 2021.08.19-
2,500 2,180.31 N Y
Medicine Co., 2021 2021 assuranc 2022.08.18
Ltd e
Guangdong
Joint
Dongfang
April 2, May 19, liability 2021.05.19-
New Special 3,000 2,998.61 N Y
2021 2021 assuranc 2022.05.11
Medicine Co.,
e
Ltd
Sinopharm Joint The minority
April 2, October 20, 2021.10.20-
Holding 1,000 1,000 liability shareholders N Y
2021 2021 2022.10.19
Shaoguan assuranc have signed the
108
Co., Ltd. e equity pledge
contract and
registered their
equity pledges
The minority
shareholders
Sinopharm Joint
have signed the
Holding April 2, June 11, liability 2021.06.11-
3,000 2,253.95 equity pledge N Y
Shaoguan 2021 2021 assuranc 2022.05.11
contract and
Co., Ltd. e
registered their
equity pledges
Sinopharm Joint
Holding April 2, May 31, liability 2021.05.31-
4,500 841.86 N Y
Maoming 2021 2021 assuranc 2022.05.11
Co., Ltd. e
Sinopharm Joint
Holding April 2, August 16, liability 2021.08.16-
5,000 N Y
Maoming 2021 2021 assuranc 2022.03.19
Co., Ltd. e
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 2, October 22, liability 2021.10.22-
Guangzhou 3,000 657.51 equity pledge N Y
2021 2021 assuranc 2022.10.22
Huadu Co., contract and
e
Ltd. registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 2, September liability 2021.09.27-
Guangzhou 2,000 36.54 equity pledge N Y
2021 27, 2021 assuranc 2022.09.26
Huadu Co., contract and
e
Ltd. registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 22, February 24, liability 2021.02.24-
Guangzhou 3,000 592.73 equity pledge N Y
2020 2021 assuranc 2022.02.23
Huadu Co., contract and
e
Ltd. registered their
equity pledges
Sinopharm April 2, Joint The minority 2021.06.03-
5,000 June 3, 2021 3,680 N Y
Holding 2021 liability shareholders 2022.05.11
109
Heyuan Co., assuranc have signed the
Ltd. e equity pledge
contract and
registered their
equity pledges
The minority
shareholders
Sinopharm Joint
have signed the
Holding April 2, liability 2021.05.06-
3,000 May 6, 2021 equity pledge N Y
Heyuan Co., 2021 assuranc 2022.03.19
contract and
Ltd. e
registered their
equity pledges
Sinopharm The minority
Holding shareholders
Joint
Foshan have signed the
April 22, March 1, liability 2021.03.01-
Medical 1,000 3.59 equity pledge N Y
2020 2021 assuranc 2022.02.28
Supplies contract and
e
Supply Chain registered their
Co., Ltd. equity pledges
The minority
Sinopharm shareholders
Joint
Accord have signed the
April 2, May 18, liability 2021.05.18-
(Guangzhou) 2,000 equity pledge N Y
2021 2021 assuranc 2022.05.11
Medicine Co., contract and
e
Ltd. registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Accord have signed the
April 2, liability 2021.06.01-
(Yangjiang) 5,000 June 1, 2021 equity pledge N Y
2021 assuranc 2022.05.11
Medicine Co., contract and
e
Ltd. registered their
equity pledges
Sinopharm Joint
Holding April 2, May 25, liability 2021.05.25-
30,000 15,581.7 N Y
Guangxi Co., 2021 2021 assuranc 2022.05.25
Ltd. e
Sinopharm Joint
Holding April 2, October 20, liability 2021.10.20-
16,000 11,083.91 N Y
Guangxi Co., 2021 2021 assuranc 2022.10.19
Ltd. e
Sinopharm April 2, 15,000 August 27, 10,323.75 Joint 2021.08.27- N Y
110
Holding 2021 2021 liability 2022.08.26
Guangxi Co., assuranc
Ltd. e
Sinopharm Joint
Holding April 2, December liability 2021.12.31-
10,000 N Y
Guangxi Co., 2021 31, 2021 assuranc 2022.12.30
Ltd. e
Sinopharm Joint
Holding April 2, June 28, liability 2021.06.28-
25,000 6,932.51 N Y
Guangxi Co., 2021 2021 assuranc 2022.06.28
Ltd. e
Sinopharm Joint
Holding April 2, September liability 2021.09.03-
10,000 N Y
Guangxi Co., 2021 3, 2021 assuranc 2022.06.30
Ltd. e
Sinopharm Joint
Holding April 2, May 20, liability 2021.05.20-
20,000 13,848.08 N Y
Guangxi Co., 2021 2021 assuranc 2022.05.20
Ltd. e
The minority
Sinopharm Joint shareholders
Holding April 2, October 20, liability have signed the 2021.10.20-
5,000 1,964.52 N Y
Liuzhou Co., 2021 2021 assuranc counter- 2022.10.19
Ltd. e guarantee
contract
The minority
Sinopharm Joint shareholders
Holding April 2, July 21, liability have signed the 2021.07.21-
10,000 2,761.75 N Y
Liuzhou Co., 2021 2021 assuranc counter- 2022.07.20
Ltd. e guarantee
contract
The minority
Sinopharm Joint shareholders
Holding April 22, March 4, liability have signed the 2021.03.04-
10,000 3,368.64 N Y
Liuzhou Co., 2020 2021 assuranc counter- 2022.02.08
Ltd. e guarantee
contract
The minority
Sinopharm Joint
shareholders
Holding April 2, September liability 2021.09.29-
5,000 3,133.76 have signed the N Y
Liuzhou Co., 2021 29, 2021 assuranc 2022.07.01
counter-
Ltd. e
guarantee
111
contract
The minority
Sinopharm Joint shareholders
Holding April 2, May 17, liability have signed the 2021.05.17-
9,000 3,000 N Y
Liuzhou Co., 2021 2021 assuranc counter- 2022.05.16
Ltd. e guarantee
contract
Sinopharm Joint
Holding April 2, May 20, liability 2021.05.20-
2,000 1,500 N Y
Beihai Co., 2021 2021 assuranc 2022.05.20
Ltd. e
Sinopharm Joint
Holding April 2, May 26, liability 2021.05.26-
3,000 3,000 N Y
Beihai Co., 2021 2021 assuranc 2022.05.25
Ltd. e
Sinopharm Joint
Holding April 2, May 26, liability 2021.05.26-
2,000 2,000 N Y
Guigang Co., 2021 2021 assuranc 2022.05.25
Ltd. e
Sinopharm Joint
Holding April 22, August 7, liability 2020.08.07-
2,000 2,000 N Y
Wuzhou Co., 2020 2020 assuranc 2021.08.07
Ltd. e
Sinopharm Joint
Holding April 22, January 29, liability 2021.01.29-
1,000 1,000 N Y
Guigang Co., 2020 2021 assuranc 2022.01.28
Ltd. e
Sinopharm Joint
Holding April 2, May 26, liability 2021.05.26-
2,000 2,000 N Y
Guilin Co., 2021 2021 assuranc 2022.05.25
Ltd. e
Sinopharm Joint
Holding April 2, May 26, liability 2021.05.26-
3,000 2,000 N Y
Yulin Co., 2021 2021 assuranc 2022.05.25
Ltd. e
Sinopharm The minority
Holding shareholders
Joint
Medicine have signed the
April 2, August 20, liability 2021.08.20-
Supply Chain 706 equity pledge N Y
2021 2021 assuranc 2022.08.19
Service contract and
e
(Guangxi) registered their
Co., Ltd. equity pledges
112
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 2, October 20, liability 2021.10.20-
Shenzhen 4,000 3,340 equity pledge N Y
2021 2021 assuranc 2022.10.19
Yanfeng Co., contract and
e
Ltd. registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 2, October 11, liability 2021.10.26-
Shenzhen 8,000 863.96 equity pledge N Y
2021 2021 assuranc 2022.10.11
Yanfeng Co., contract and
e
Ltd. registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 2, December 1, liability 2021.12.01-
Shenzhen 4,000 974.25 equity pledge N Y
2021 2021 assuranc 2022.11.30
Yanfeng Co., contract and
e
Ltd. registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Holding have signed the
April 2, liability 2021.07.08-
Shenzhen 5,000 July 8, 2021 140 equity pledge N Y
2021 assuranc 2022.05.27
Yanfeng Co., contract and
e
Ltd. registered their
equity pledges
Sinopharm
Joint
Holding
April 2, October 20, liability 2021.10.20-
Shenzhen 3,000 2,490.06 N Y
2021 2021 assuranc 2022.10.19
Jianmin Co.,
e
ltd.
Sinopharm
Joint
Holding
April 2, December 8, liability 2021.12.08-
Shenzhen 2,000 1,680 N Y
2021 2021 assuranc 2022.11.18
Jianmin Co.,
e
ltd.
Sinopharm Joint
Holding April 2, December 1, liability 2021.12.01-
1,000 998.48 N Y
Shenzhen 2021 2021 assuranc 2022.11.30
Jianmin Co., e
113
ltd.
Sinopharm
Joint
Holding
April 2, June 22, liability 2021.06.22-
Shenzhen 3,000 Y Y
2021 2021 assuranc 2022.05.11
Jianmin Co.,
e
ltd.
Sinopharm
Holding Joint
Shenzhen April 2, June 22, liability 2021.06.22-
1,500 Y Y
Medicinal 2021 2021 assuranc 2022.05.11
Materials Co., e
Ltd.
Sinopharm
Holding Joint
Shenzhen April 2, October 20, liability 2021.10.20-
500 N Y
Medicinal 2021 2021 assuranc 2022.10.19
Materials Co., e
Ltd.
The minority
Sinopharm
shareholders
Accord Joint
have signed the
Medical April 2, October 20, liability 2021.10.20-
3,000 2,360.02 equity pledge N Y
Devices 2021 2021 assuranc 2022.10.19
contract and
(Shenzhen) e
registered their
Co., Ltd.
equity pledges
The minority
Sinopharm
shareholders
Accord Joint
have signed the
Medical April 22, March 24, liability 2021.03.24-
3,000 2,500 equity pledge N Y
Devices 2020 2021 assuranc 2022.03.24
contract and
(Shenzhen) e
registered their
Co., Ltd.
equity pledges
The minority
Sinopharm
shareholders
Accord Joint
have signed the
Medical April 2, November liability 2021.11.22-
5,000 5,000 equity pledge N Y
Devices 2021 22, 2021 assuranc 2022.05.11
contract and
(Shenzhen) e
registered their
Co., Ltd.
equity pledges
Total amount of approving Total amount of
guarantee for subsidiaries in 865,206 actual occurred 1,294,382.95
report period (B1) guarantee for
114
subsidiaries in
report period (B2)
Total balance of
Total amount of approved
actual guarantee for
guarantee for subsidiaries at
877,206 subsidiaries at the 381,547.28
the end of reporting period
end of reporting
(B3)
period (B4)
Guarantees of subsidiaries to subsidiaries
Related Guarante
Collat Counter-
Name of the Announcem Actual date Actual Imple e for
Guarant Guarant eral (if guarantee Guarantee
Company ent of guarantee mented related
ee limit ee type applic situation (if term
guaranteed disclosure happening limit (Y/N) party
able) applicable)
date (Y/N)
Beijing
Jinxiang Joint
2021.12.24
Drugstore April 2, December liability
4,200 2,203.87 — N Y
Medicine 2021 24, 2021 assuranc
2022.12.23
Chain Co., e
Ltd
Fujian Guoda Joint
2021.08.13
Drugstore April 2, August 13, liability
1,200 763.33 — N Y
Chain Co., 2021 2021 assuranc
2022.08.12
Ltd. e
Fujian Guoda Joint
2021.11.02
Drugstore April 2, November liability
1,800 1,281.77 — N Y
Chain Co., 2021 2, 2021 assuranc
2022.11.01
Ltd. e
Joint
Fujian Guoda 2021.08.13
April 2, August 13, liability
Medicines 600 444.74 — N Y
2021 2021 assuranc
Co., Ltd. 2022.08.12
e
The minority
Guoda shareholders
Joint
Drugstore have signed the 2021.06.10
April 2, June 10, liability
(Pu'er) 1,200 790.53 equity pledge — N Y
2021 2021 assuranc
Songmao Co., contract and 2022.05.12
e
Ltd. registered their
equity pledges
Joint
Guoda Yihe 2021.09.10
April 2, September liability
Drugstore 4,080 3,990.96 — N Y
2021 10, 2021 assuranc
Jilin Co., Ltd. 2022.09.10
e
115
China The minority
National shareholders
Joint
Hebei have signed the 2021.12.24
April 2, December liability
Lerentang 3,000 2,752.49 equity pledge — N Y
2021 24, 2021 assuranc
Medicine contract and 2022.12.23
e
Chain Co., registered their
Ltd. equity pledges
China The minority
National shareholders
Joint
Hebei have signed the 2021.11.02
April 2, November liability
Lerentang 4,800 4,797.21 equity pledge — N Y
2021 2, 2021 assuranc
Medicine contract and 2022.11.01
e
Chain Co., registered their
Ltd. equity pledges
China The minority
National shareholders
Joint
Hebei have signed the 2021.06.08
April 2, liability
Lerentang 9,000 June 8, 2021 4,224.86 equity pledge — N Y
2021 assuranc
Medicine contract and 2022.05.12
e
Chain Co., registered their
Ltd. equity pledges
Sinopharm
Holding
Joint
Guoda For 2021.07.09
April 2, liability
Me Pharmacy 1,800 July 9, 2021 270.29 — N Y
2021 assuranc
Shanghai 2022.05.24
e
Chain Co.,
Ltd.
Sinopharm
Holding
Joint
Guoda For 2021.11.23
April 2, November liability
Me Pharmacy 1,800 896.24 — N Y
2021 23, 2021 assuranc
Shanghai 2022.04.22
e
Chain Co.,
Ltd.
Sinopharm
Joint
Holding 2021.07.12
April 2, July 12, liability
Guoda Shanxi 13,200 13,230 — N Y
2021 2021 assuranc
Medicines 2022.05.12
e
Co., Ltd.
Sinopharm Joint
April 2, November 2021.11.02
Holding 6,000 6,000 liability N Y
2021 2, 2021 —
Guoda Shanxi assuranc
116
Medicines e 2022.11.01
Co., Ltd.
Sinopharm
Holding
Joint
Guoda 2021.12.24
April 2, December liability
Drugstore 1,800 1,045.73 — N Y
2021 24, 2021 assuranc
(Shenzhen) 2022.12.23
e
Chain Co.,
Ltd.
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2021.06.04
Guoda April 2, liability
600 June 4, 2021 594.77 equity pledge — N Y
Drugstore 2021 assuranc
contract and 2022.05.12
Bayan Nur e
registered their
Co., Ltd.
equity pledges
Sinopharm
Holding Joint
2021.11.02
Guoda April 2, November liability
6,000 2,115.66 — N Y
Drugstore 2021 2, 2021 assuranc
2022.11.01
Guangdong e
Co., Ltd.
Sinopharm
Holding Joint
2021.12.24
Guoda April 2, December liability
1,800 308.03 — N Y
Drugstore 2021 24, 2021 assuranc
2022.12.23
Guangdong e
Co., Ltd.
Sinopharm
Holding Joint
2021.06.22
Guoda April 2, June 22, liability
6,000 4,139.96 — N Y
Drugstore 2021 2021 assuranc
2022.05.12
Guangdong e
Co., Ltd.
Sinopharm
Holding
Joint
Guoda 2021.11.02
April 2, November liability
Drugstore 1,800 293.54 — N Y
2021 2, 2021 assuranc
Guangxi 2022.11.01
e
Chain Co.,
Ltd.
Sinopharm April 2, 600 December 340.09 Joint 2021.12.24 N Y
117
Holding 2021 24, 2021 liability —
Guoda assuranc 2022.12.23
Drugstore e
Guangxi
Chain Co.,
Ltd.
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2021.12.24
Guoda April 2, December liability
1,200 959.28 equity pledge — N Y
Drugstore 2021 24, 2021 assuranc
contract and 2022.12.23
Henan Chain e
registered their
Co., Ltd.
equity pledges
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2021.08.18
Guoda April 2, August 18, liability
1,800 1,787.35 equity pledge — N Y
Drugstore 2021 2021 assuranc
contract and 2022.05.12
Henan Chain e
registered their
Co., Ltd.
equity pledges
Sinopharm
Holding Joint
2021.06.04
Guoda April 2, liability
600 June 4, 2021 595.13 — N Y
Drugstore 2021 assuranc
2022.05.12
Hulun Buir e
Co., Ltd.
Sinopharm
Holding Joint
2021.11.02
Guoda April 2, November liability
600 522.41 — N Y
Drugstore 2021 2, 2021 assuranc
2022.11.01
Hulun Buir e
Co., Ltd.
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2021.11.02
Guoda April 2, November liability
1,800 722.55 equity pledge — N Y
(Jiangmen) 2021 2, 2021 assuranc
contract and 2022.11.01
Pharmaceutic e
registered their
al Co., Ltd.
equity pledges
Sinopharm Joint The minority
2021.04.02
Holding April 2, April 2, liability shareholders
1,200 610.36 — N Y
Guoda 2021 2021 assuranc have signed the
2022.04.01
(Jiangmen) e equity pledge
118
Pharmaceutic contract and
al Co., Ltd. registered their
equity pledges
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2021.12.24
Guoda April 2, December liability
1,800 622.91 equity pledge — N Y
(Jiangmen) 2021 24, 2021 assuranc
contract and 2022.12.23
Pharmaceutic e
registered their
al Co., Ltd.
equity pledges
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2020.12.28
Guoda April 22, December liability
3,000 1,570.21 equity pledge — N Y
(Jiangmen) 2020 28, 2020 assuranc
contract and 2021.12.27
Pharmaceutic e
registered their
al Co., Ltd.
equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.12.24
April 2, December liability
Drugstore 600 504.09 equity pledge — N Y
2021 24, 2021 assuranc
Nanjing contract and 2022.12.23
e
Chain Co., registered their
Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.11.04
April 2, November liability
Drugstore 1,800 687.58 equity pledge — N Y
2021 4, 2021 assuranc
Inner contract and 2022.11.03
e
Mongolia registered their
Co., Ltd equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.07.22
April 2, July 22, liability
Drugstore 1,800 1,799.07 equity pledge — N Y
2021 2021 assuranc
Inner contract and 2022.07.22
e
Mongolia registered their
Co., Ltd equity pledges
Sinopharm The minority
Joint
Holding shareholders 2021.11.02
April 2, November liability
Guoda 6,000 5,888.73 have signed the — N Y
2021 2, 2021 assuranc
Drugstore equity pledge 2022.11.01
e
Inner contract and
119
Mongolia registered their
Co., Ltd equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.12.24
April 2, December liability
Drugstore 4,800 760.72 equity pledge — N Y
2021 24, 2021 assuranc
Inner contract and 2022.12.23
e
Mongolia registered their
Co., Ltd equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.06.07
April 2, liability
Drugstore 1,800 June 7, 2021 1,771.69 equity pledge — N Y
2021 assuranc
Inner contract and 2022.05.12
e
Mongolia registered their
Co., Ltd equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.12.30
April 2, December liability
Drugstore 6,600 equity pledge — N Y
2021 30, 2021 assuranc
Inner contract and 2022.12.29
e
Mongolia registered their
Co., Ltd equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.05.06
April 2, liability
Drugstore 5,040 May 6, 2021 1,136.95 equity pledge — N Y
2021 assuranc
Shanxi contract and 2022.05.05
e
Yiyuan Chain registered their
Co., Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2020.11.28
April 22, November liability
Drugstore 3,600 1,851.66 equity pledge — N Y
2020 28, 2020 assuranc
Shanxi contract and 2021.11.27
e
Yiyuan Chain registered their
Co., Ltd. equity pledges
Sinopharm The minority
Holding Joint shareholders
2021.11.08
Guoda April 2, November liability have signed the
3,000 2,785.24 — N Y
Drugstore 2021 8, 2021 assuranc equity pledge
2022.11.07
Shanxi e contract and
Yiyuan Chain registered their
120
Co., Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.11.02
April 2, November liability
Drugstore 9,000 8,952.94 equity pledge — N Y
2021 2, 2021 assuranc
Shanxi contract and 2022.11.01
e
Yiyuan Chain registered their
Co., Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.12.06
April 2, December 6, liability
Drugstore 5,400 3,663.23 equity pledge — N Y
2021 2021 assuranc
Shanxi contract and 2022.12.05
e
Yiyuan Chain registered their
Co., Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.06.08
April 2, liability
Drugstore 4,200 June 8, 2021 4,158.69 equity pledge — N Y
2021 assuranc
Shanxi contract and 2022.05.12
e
Yiyuan Chain registered their
Co., Ltd. equity pledges
Sinopharm
Holding
Joint
Guoda 2021.12.13
April 2, December liability
Drugstore 1,800 — N Y
2021 13, 2021 assuranc
Shanghai 2022.04.22
e
Chain Co.,
Ltd.
Sinopharm
Holding
Joint
Guoda 2021.06.20
April 2, June 20, liability
Drugstore 2,400 1,961.58 — N Y
2021 2021 assuranc
Shanghai 2022.06.20
e
Chain Co.,
Ltd.
Sinopharm
Holding
Joint
Guoda 2021.07.16
April 2, July 16, liability
Drugstore 2,400 — N Y
2021 2021 assuranc
Shanghai 2022.07.16
e
Chain Co.,
Ltd.
121
Sinopharm
Holding
Joint
Guoda 2021.07.09
April 2, liability
Drugstore 3,000 July 9, 2021 1,827.27 — N Y
2021 assuranc
Shanghai 2022.05.24
e
Chain Co.,
Ltd.
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.12.24
April 2, December liability
Drugstore 6,000 1,328.35 equity pledge — N Y
2021 24, 2021 assuranc
Shenyang contract and 2022.12.23
e
Chain Co., registered their
Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.12.16
April 2, December liability
Drugstore 6,000 3,626.66 equity pledge — N Y
2021 16, 2021 assuranc
Shenyang contract and 2022.12.16
e
Chain Co., registered their
Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.11.02
April 2, November liability
Drugstore 15,000 11,099.87 equity pledge — N Y
2021 2, 2021 assuranc
Shenyang contract and 2022.11.01
e
Chain Co., registered their
Ltd. equity pledges
Sinopharm The minority
Holding shareholders
Joint
Guoda have signed the 2021.06.01
April 2, liability
Drugstore 13,800 June 1, 2021 13,797.89 equity pledge — N Y
2021 assuranc
Shenyang contract and 2022.05.12
e
Chain Co., registered their
Ltd. equity pledges
The minority
Sinopharm
shareholders
Holding Joint
have signed the 2021.06.04
Guoda April 2, liability
600 June 4, 2021 20.84 equity pledge — N Y
Drugstore 2021 assuranc
contract and 2022.05.12
Ulanqab Co., e
registered their
Ltd.
equity pledges
122
Sinopharm
Holding
Guoda
Joint
Drugstore 2021.12.06
April 2, December 6, liability
Xinjiang New 3,000 1,089.96 — N Y
2021 2021 assuranc
Special 2022.12.06
e
Medicine
Chain Co.,
Ltd.
Sinopharm
Holding
Guoda
Joint
Drugstore 2021.05.26
April 2, May 26, liability
Xinjiang New 4,800 4,765.48 — N Y
2021 2021 assuranc
Special 2022.05.12
e
Medicine
Chain Co.,
Ltd.
Sinopharm
Holding
Guoda Joint
2021.11.02
Drugstore April 2, November liability
1,200 853.23 — N Y
Yangzhou 2021 2, 2021 assuranc
2022.11.01
Dadesheng e
Chain Co.,
Ltd.
Sinopharm
Holding
Guoda Joint
2021.12.24
Drugstore April 2, December liability
1,200 980.09 — N Y
Yangzhou 2021 24, 2021 assuranc
2022.12.23
Dadesheng e
Chain Co.,
Ltd.
The minority
Sinopharm shareholders
Joint
Holding have signed the 2021.11.09
April 2, November liability
Tianhe Jilin 6,000 4,004.43 equity pledge — N Y
2021 9, 2021 assuranc
Medicines contract and 2022.11.08
e
Co., Ltd. registered their
equity pledges
Sinopharm April 2, November Joint The minority 2021.11.02
3,000 2,641.2 N Y
Holding 2021 2, 2021 liability shareholders —
123
Tianhe Jilin assuranc have signed the 2022.11.01
Medicines e equity pledge
Co., Ltd. contract and
registered their
equity pledges
The minority
Sinopharm shareholders
Joint
Holding have signed the 2021.04.28
April 2, April 28, liability
Tianhe Jilin 6,000 1,316.77 equity pledge — N Y
2021 2021 assuranc
Medicines contract and 2022.04.27
e
Co., Ltd. registered their
equity pledges
The minority
Hunan Guoda shareholders
Joint
Minshentang have signed the 2021.11.02
April 2, November liability
Drugstore 1,800 1,211.89 equity pledge — N Y
2021 2, 2021 assuranc
Chain Co., contract and 2022.11.01
e
Ltd. registered their
equity pledges
The minority
Hunan Guoda shareholders
Joint
Minshentang have signed the 2021.12.24
April 2, December liability
Drugstore 1,200 614.48 equity pledge — N Y
2021 24, 2021 assuranc
Chain Co., contract and 2022.12.23
e
Ltd. registered their
equity pledges
Liaoning
Chengda Joint
2021.06.22
Fangyuan April 2, June 22, liability
15,000 11,540.81 — N Y
Medicine 2021 2021 assuranc
2022.06.21
Chain Co., e
Ltd.
Liaoning
Chengda Joint
2021.12.24
Fangyuan April 2, December liability
6,000 4,217.04 — N Y
Medicine 2021 24, 2021 assuranc
2022.12.23
Chain Co., e
Ltd.
Liaoning
Joint
Chengda 2021.06.01
April 2, liability
Fangyuan 4,800 June 1, 2021 4,794.3 — N Y
2021 assuranc
Medicine 2022.05.12
e
Chain Co.,
124
Ltd.
Liaoning
Chengda Joint
2021.11.02
Fangyuan April 2, November liability
6,000 3,445.24 — N Y
Medicine 2021 2, 2021 assuranc
2022.11.01
Chain Co., e
Ltd.
Liaoning Joint
2021.11.02
Guoda April 2, November liability
3,000 — N Y
Medicines 2021 2, 2021 assuranc
2022.11.01
Co., Ltd. e
Liaoning Joint
2021.06.01
Guoda April 2, liability
3,000 June 1, 2021 2,999.46 — N Y
Medicines 2021 assuranc
2022.05.12
Co., Ltd. e
Inner
Joint
Mongolia 2021.06.07
April 2, liability
Guoda 2,400 June 7, 2021 2,399.56 — N Y
2021 assuranc
Medicine Co., 2022.05.12
e
Ltd.
Ningxia
Joint
Guoda 2021.09.06
April 2, September liability
Drugstore 2,400 2,383.2 — N Y
2021 6, 2021 assuranc
Chain Co., 2022.09.06
e
Ltd.
Ningxia
Joint
Guoda 2021.12.24
April 2, December liability
Drugstore 1,200 — N Y
2021 24, 2021 assuranc
Chain Co., 2022.12.23
e
Ltd.
The minority
Shanxi Guoda shareholders
Joint
Wanmin have signed the 2021.12.22
April 2, December liability
Drugstore 3,600 1,980 equity pledge — N Y
2021 22, 2021 assuranc
Chain Co., contract and 2022.12.21
e
Ltd. registered their
equity pledges
Shanxi Guoda The minority
Joint
Wanmin shareholders 2021.08.17
April 2, August 17, liability
Drugstore 2,400 720 have signed the — N Y
2021 2021 assuranc
Chain Co., equity pledge 2022.02.04
e
Ltd. contract and
125
registered their
equity pledges
The minority
Shanxi Guoda shareholders
Joint
Wanmin have signed the 2021.07.15
April 2, July 15, liability
Drugstore 3,600 3,600 equity pledge — N Y
2021 2021 assuranc
Chain Co., contract and 2022.07.15
e
Ltd. registered their
equity pledges
The minority
Shanxi Guoda shareholders
Joint
Wanmin have signed the 2021.06.08
April 2, liability
Drugstore 15,000 June 8, 2021 11,940 equity pledge — N Y
2021 assuranc
Chain Co., contract and 2022.05.12
e
Ltd. registered their
equity pledges
The minority
Shanxi Guoda shareholders
Joint
Wanmin have signed the 2021.11.02
April 2, November liability
Drugstore 7,200 7,200 equity pledge — N Y
2021 2, 2021 assuranc
Chain Co., contract and 2022.11.01
e
Ltd. registered their
equity pledges
The minority
Shanxi Guoda shareholders
Joint
Wanmin have signed the 2021.04.29
April 2, April 29, liability
Drugstore 3,000 equity pledge — N Y
2021 2021 assuranc
Chain Co., contract and 2022.04.15
e
Ltd. registered their
equity pledges
The minority
shareholders
Yanji Joint
have signed the 2021.06.08
Xianghe April 2, liability
1,800 June 8, 2021 1,200 equity pledge — N Y
Medicines 2021 assuranc
contract and 2022.05.12
Co., Ltd. e
registered their
equity pledges
The minority
Yushu Dinghe Joint shareholders
2021.06.08
Pharmaceutic April 2, liability have signed the
1,800 June 8, 2021 415.14 — N Y
al Technology 2021 assuranc equity pledge
2022.05.12
Co., Ltd. e contract and
registered their
126
equity pledges
Total amount of
Total amount of approving actual occurred
guarantee for subsidiaries in 291,720 guarantee for 792,084.85
report period (C1) subsidiaries in
report period (C2)
Total balance of
Total amount of approved
actual guarantee for
guarantee for subsidiaries at
298,320 subsidiaries at the 201,809.61
the end of reporting period
end of reporting
(C3)
period (C4)
Total amount of guarantee of the Company (total of three above mentioned guarantee)
Total amount of
Total amount of approving
actual occurred
guarantee in report period 1,156,926 2,086,467.8
guarantee in report
(A1+B1+C1)
period (A2+B2+C2)
Total balance of
Total amount of approved
actual guarantee at
guarantee at the end of report 1,175,526 583,356.89
the end of report
period (A3+B3+C3)
period (A4+B4+C4)
The proportion of the total amount of actually
guarantee in the net assets of the Company (that is 39.09%
A4+ B4+C4)
Including:
Amount of guarantee for shareholders, actual
0
controller and its related parties (D)
The debts guarantee amount provided for the
guaranteed parties whose assets-liability ratio 0
exceed 70% directly or indirectly (E)
Proportion of total amount of guarantee in net
0
assets of the Company exceed 50% (F)
Total amount of the aforesaid three guarantees
0
(D+E+F)
Explanations on possibly bearing joint and several
liquidating responsibilities for undue guarantees (if 0
applicable)
Explanations on external guarantee against
0
regulated procedures (if applicable)
Explanation on guarantee using the composite way
127
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. Other material contracts
□ Applicable √ Not applicable
No other material contracts for the Company in reporting period.
XVI. Explanation on other significant events
□ Applicable √ Not applicable
No other significant events need to explain in the reporting period.
XVII. Significant event of subsidiary of the Company
□ Applicable √ Not applicable
128
Section VII. 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
Bonus tion of Proportio
Amount Proportion shares Others Subtotal Amount
shares public n
issued
reserve
I. Restricted shares 5,508,883 1.29% 5,508,883 1.29%
1.Shares hold by the state
2. State-owned legal
5,505,770 1.29% 5,505,770 1.29%
person’s shares
3. Other domestic
3,113 0.00% 3,113 0.00%
shareholding
Including: Domestic
0 0.00% 0 0.00%
legal person’s shares
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
II. Unrestricted shares 422,618,100 98.71% 422,618,100 98.71%
1. RMB Ordinary shares 367,733,625 85.89% 367,733,625 85.89%
2. Domestically listed
54,884,475 12.82% 54,884,475 12.82%
foreign shares
3. Foreign shares listed
abroad
4. Other
III. Total shares 428,126,983 100.00% 428,126,983 100.00%
Reasons for share changed
129
□ Applicable √ Not applicable
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose for the Company or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of restricted shares
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□ Applicable √ Not applicable
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 preferred Total
44,290 42,450 0 0
stock stock shareholders with preferred
130
shareholders in shareholders at voting rights shareholders
reporting end of last month recovered at end of with voting
period-end before annual reporting period (if rights
report disclosed applicable) recovered at
end of last
month before
annual report
disclosed (if
applicable)
Particulars about shares held above 5% by shareholders or top ten shareholders
Proport Total Chang Information of shares
Amount of Amount of un-
Full name of Nature of ion of shareholders es in pledged, tagged or frozen
lock-up restricted
Shareholders shareholder shares at the end of report
shares held shares held State of share Amount
held report period period
Sinopharm Group State-owned
56.06% 239,999,991 5,505,770 234,494,221
Co., Ltd. Corporation
FIRST SENTIER
INVESTORS
GLOBAL
Foreign
UMBRELLA 2.52% 10,802,495 10,802,495
Corporation
FUND PLC - FSSA
CHINA GROWTH
FUND
Hong Kong
Foreign
Securities Clearing 2.19% 9,383,011 9,383,011
Corporation
Company Ltd.
China National
Pharmaceutical State-owned
1.24% 5,323,043 5,323,043
Foreign Trade Corporation
Corp.
National Social Domestic non
Security Fund 413 state-owned 1.06% 4,530,032 4,530,032
Portfolio Corporation
BBH BOS S/A
Foreign
FIDELITY FD - 0.78% 3,358,761 3,358,761
Corporation
CHINA FOCUS FD
Fidelity Investment
Management (Hong Foreign
0.54% 2,301,737 2,301,737
Kong) Limited - Corporation
Client’s fund
ICBC-Guolian
Domestic non
Andesheng Small
state-owned 0.38% 1,632,000 1,632,000
Selected Securities
Corporation
Investment Fund
131
VANGUARD
EMERGING
Foreign
MARKETS 0.37% 1,603,189 1,603,189
Corporation
STOCK INDEX
FUND
CPIC Fund -China
Pacific Life
Insurance Co., Ltd.
- with-profit
insurance- CPIC
Domestic non
Fund China Pacific
state-owned 0.34% 1,470,224 1,470,224
Life Equity Relative
Corporation
Income
(Guaranteed
Dividend) single
assets management
plan
Strategy investors or general
corporation comes top 10 shareholders
due to rights issue (if applicable)
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.
Description of the above shareholders
in relation to delegate/entrusted voting
rights and abstention from voting
rights.
Special note on the repurchase account
among the top 10 shareholders (if
applicable)
Particular about top ten common shareholders with un-restrict shares held
Type of shares
Shareholders Amount of un-restrict common shares held at period-end
Type Amount
RMB ordinary
Sinopharm Group Co., Ltd. 234,494,221 234,494,221
shares
FIRST SENTIER INVESTORS Domestically
GLOBAL UMBRELLA FUND PLC - 10,802,495 listed foreign 10,802,495
FSSA CHINA GROWTH FUND shares
Hong Kong Securities Clearing RMB ordinary
9,383,011 9,383,011
Company Ltd. shares
China National Pharmaceutical RMB ordinary
5,323,043 5,323,043
Foreign Trade Corp. shares
132
National Social Security Fund 413 RMB ordinary
4,530,032 4,530,032
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
2,301,737 2,301,737
(Hong Kong) Limited - Client’s fund shares
ICBC-Guolian Andesheng Small RMB ordinary
1,632,000 1,632,000
Selected Securities Investment Fund shares
Domestically
VANGUARD EMERGING
1,603,189 listed foreign 1,603,189
MARKETS STOCK INDEX FUND
shares
CPIC Fund -China Pacific Life
Insurance Co., Ltd. - with-profit
insurance- CPIC Fund China Pacific RMB ordinary
1,470,224 1,470,224
Life Equity Relative Income shares
(Guaranteed Dividend) single assets
management plan
Expiation on associated relationship or Sinopharm Group Co., Ltd. and China National Pharmaceutical Foreign Trade Corporation
consistent actors within the top 10 un- have the same actual controller, which is China National Pharmaceutical Group
restrict shareholders and between top Corporation. It is unknown that there exists no associated relationship or belongs to the
10 un-restrict shareholders and top 10 consistent actionist among the other tradable shareholders regulated by the Management
shareholders Measure of Information Disclosure on Change of Shareholding for Listed Companies.
Explanation on top 10 shareholders
involving margin business (if
applicable)
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 Organization
Controlling shareholders Date of foundation Main operation business
in charge of the unit code
Industrial investment holding;
Sinopharm Group Co., Ltd. Yu Qingming January 8, 2003 74618434-4
management and assets
133
reorganization entrusted by
pharmaceutical enterprise; Chinese
medicine, Chinese medicine tablets,
chemical medicine preparations,
chemical raw materials, antibiotics,
biochemical drugs, biological
products, narcotic drugs,
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, 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), wholesale of disinfection
products, daily necessities, textiles
and knitwear and protective
equipment for medical staff, sales of
labor protection supplies, daily mask
(non-medical) sales, logistics and
related consulting services, operating
various types of goods and import
and export of technology (not
attached directory of import and
export commodities), but excluded
the import and export of goods and
technology the State limits or prohibit
the company. Etc. (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
Sinopharm Group Co., Ltd. hold 54.72 percent equity of China National Medicines Corporation Ltd
domestic/oversea listed
(Stock code: 600511) up to the end of Period.
company control by
134
controlling shareholder as
well as stock-joint in report
period
Changes of controlling shareholders in reporting period
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period.
3. Actual controller of the Company and persons acting in concert
Nature of actual controller: central state-owned assets management
Type of actual controller: legal person
Legal
Actual controlling person/person Date of
Organization code Main operation business
shareholders in charge of the foundation
unit
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 enterprise, asset
Pharmaceutical Group Liu Jingzhen March 26, 1987 10000588-8 reorganization; consulting
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)
135
Name of listed Total shareholders
Proportion of
Name company with held (10 thousand
shares held
shares held shares)
SINOPHARM 20,728.95 6.64%
Sinopharm
Holding Sinopharm
Industrial Holding 157,155.60 50.36%
Investment
Co., Ltd.
Sinopharm Sinopharm
41,284.17 54.72%
Holding Holding
Sinopharm Sinopharm
24,000.00 56.06%
Holding Accord
Sinopharm
SIPS 23,951.26 23.32%
Modern
Sinopharm Sinopharm
16,714.22 16.28%
Accord Modern
China
Biotechnology 62,673.65 45.64%
Co., Ltd.
Equity of domestic/oversea Chengdu
listed company control by Institute of
actual controller in report Biological 4,848.43 3.53%
period Products Co., BTBP
Ltd.
Beijing
Institute of
Biological 1,305.72 0.95%
Products Co.,
Ltd.
SINOPHARM
China TCM 163,470.56 32.46%
H.K. Co., Ltd.
Tai Chi Group
15,381.23 27.62%
Co., Ltd.
Chongqing
Fuling District
Xilan 1,189.53 2.14%
Biotechnology
Tai Chi Group
Co., Ltd.
Chongqing
Taiji Medicinal
Animal and 36.73 0.07%
Plant
Resources
136
Development
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:
Actual controller controlling the Company by entrust or other assets management
□ Applicable √ Not applicable
4.The total number of shares pledged by controlling shareholders or the first majority shareholder and its
persons acting in concert accounts for 80% of the shares held by them
□ Applicable √ Not applicable
5. Particulars about other legal person shareholders with over 10% shares held
□ Applicable √ Not applicable
137
6. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,
restructuring side and other commitment subjects
□ Applicable √ Not applicable
IV. The specific implementation of shares buy-back during the reporting period
Implementation progress of shares buy-back
□ Applicable √ Not applicable
Implementation progress of the reduction of repurchases shares by centralized bidding
□ Applicable √ Not applicable
138
Section VIII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period.
139
Section IX. Bonds
□ Applicable √ Not applicable
140
Section X. Financial Report
141
AUDITOR’S REPORT
Ernst & Young Hua Ming (2022) 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 balance sheets as at 31 December 2021,
and the consolidated and the company income statements, the consolidated and the company statements of
changes in equity and the consolidated and the company 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 financial position as at 31 December 2021, and the consolidated and the company 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.
142
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2022) 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
RMB2,775,645,585.32 as at 31 December 2021 and are as follows:
was allocated to the Company’s asset groups under
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) Involving internal evaluation experts to assist in
annually. The impairment test is based on the evaluating the goodwill impairment method and
recoverable amounts of the respective asset groups forecasted key parameters adopted by
to which the goodwill is allocated. The recoverable management in the impairment test, especially
amounts of the asset groups are determined the discount rate and perpetual growth rate;
according to the present value of the asset groups'
expected future cash flows. As the impairment test 3) Re-examining the sales revenue and operating
process of goodwill involves significant judgement of results of the future years adopted in the cash
the management, the test results highly depend on flow forecast, comparing with the historical
the management's estimates and assumptions, such operating results of the related asset groups,
as the estimation of the forecasted future cash flows especially the future sales growth rate, expected
and the discount rate of the asset groups. These gross profit margin, related expenses, etc., and
estimates are affected by the management's evaluating the analyses made by the
judgement on the future market and economic management on the impact of the COVID-19
environment. Using different estimates and epidemic;
assumptions will significantly impact the recoverable
value of the asset groups in which the goodwill is 4) Performing sensitivity testing on and analysing
located. Therefore, this matter was important to our key assumptions used in impairment testing;
audit, and we determined it as a key audit matter. and
The Company’s disclosures about impairment of 5) Re-examining the sufficiency of management's
goodwill are included in Note III (17. Impairment of disclosure regarding goodwill.
assets, 33. Significant accounting judgements and
estimates) and Note V (18. Goodwill) to the
consolidated financial statements.
143
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2022) 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 establishm The procedures performed to address this matter
ents, pharmacy chain stores, monomer drugstores, c are as follows:
ommunity medical service centres, downstream distri
bution companies, etc. As at 31 December 2021, the 1) Realising and testing management’s internal
carrying value of accounts receivable in the consoli control that related to the impairment of
dated financial statements of the Company was RM accounts receivable;
B15,964,603,345.91.
2) Re-examining and evaluating the "Expected
The management classifies the accounts receivable Credit Loss Model" used by the management to
into different combinations of credit risk estimate bad debts of accounts receivable,
characteristics while considering the factors such as including the management's division of different
the customer type, credit period and collection combinations of credit risk characteristics of
history. For each category of combinations of credit accounts receivable, the estimation of the
risk characteristics, the management adopts the expected credit loss on accounts receivable for
expected credit loss model to estimate and make combinations of credit risk characteristics, and
provision for bad debts. Management's estimation of historical and other forward-looking information
the expected credit loss takes into account all used in the estimation. Re-examined the
reasonable and evidence-based information, management's assessment of the impact of
including the customer's historical default rate and COVID-19 epidemic on the credit risk of
other specific factors (such as the customer type, customers;
collection history and bad debt write-offs), as well as
forward-looking information in combination with 3) Discussing with the management regarding the
factors such as the expected macroeconomic recoverability of individually significant accounts
environment. In the meantime, the management receivable or long-aged accounts receivable and
pays attention to the collection of accounts evaluating the adequacy of provision for bad
receivable, especially individually significant debts; and
accounts receivable or long-aged accounts
receivable to identify additional signs of default or 4) Re-examining the sufficiency of the
impairment and determine whether additional bad management’s disclosure related to accounts
debt provision is required. receivable.
144
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2022) 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, involve significant
management’s judgement and estimation, with great
estimation uncertainty, and the setting of various
parameters based on 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.
145
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2022) 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.
146
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2022) 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.
147
AUDITOR’S REPORT (Continued)
Ernst & Young Hua Ming (2022) 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: Deng Dong Mei
(Engagement partner)
Chinese Certified Public Accountant: Li Yuan Fen
Beijing, the People’s Republic of China 28 March 2022
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.
148
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET
31 December 2021 E
ASSETS Note V 31 December 2021 31 December 2020
Current assets
Cash and bank balances 1 5,126,159,080.94 5,998,204,295.87
Notes receivable 2 680,196,380.57 622,115,477.04
Accounts receivable 3 15,964,603,345.91 13,799,971,014.22
Receivables financing 4 1,027,226,940.21 1,404,987,700.38
Advances to suppliers 5 520,930,545.31 480,313,574.71
Other receivables 6 718,089,129.10 535,228,747.69
Inventories 7 7,621,541,595.08 6,285,010,674.46
Contract assets 8 29,061,159.52 15,177,731.64
Other current assets 9 160,607,355.66 121,082,863.45
Total current assets 31,848,415,532.30 29,262,092,079.46
Non-current assets
Long-term equity investments 10 2,459,832,546.74 2,287,019,627.99
Other equity instrument investment 11
62,488,312.99 99,488,340.28
Other non-current financial assets 12
135,974,908.51 120,972,350.24
Investment properties 13 113,981,497.23 127,444,379.94
Fixed assets 14 868,626,258.43 854,191,083.27
Construction in progress 15 49,849,506.70 46,631,190.23
Right-of-use assets 16 2,575,240,340.00 2,356,952,392.99
Intangible assets 17 669,926,562.82 734,345,179.40
Goodwill 18 2,775,645,585.32 2,747,375,281.11
Long-term prepaid expenses 19 633,975,441.76 457,705,276.09
Deferred tax assets 20 129,740,169.77 92,118,767.81
Other non-current assets 21 459,985,769.24 408,197,522.84
Total non-current assets 10,935,266,899.51 10,332,441,392.19
Total assets 42,783,682,431.81 39,594,533,471.65
The accompanying notes form an integral part of these financial statements.
149
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET (CONTINUED)
31 December 2021 E
LIABILITIES AND EQUITY Note V 31 December 2021 31 December 2020
Current liabilities
Short-term borrowings 22 1,930,467,146.38 1,612,187,020.12
Notes payable 23 7,660,216,823.68 7,520,165,274.69
Accounts payable 24 9,057,718,968.14 7,697,451,142.50
Receipts in advance 25 19,289,567.44 12,352,466.64
Contract liabilities 26 431,303,231.37 368,600,357.14
Employee benefits payable 27 340,197,125.33 357,212,047.10
Tax payable 28 337,164,080.19 316,867,149.16
Other payables 29 1,714,746,986.46 1,599,166,881.14
Non-current liabilities due within one year 30 848,328,648.14 748,732,059.89
Other current liabilities 31 39,585,469.65 24,787,078.55
Total current liabilities 22,379,018,046.78 20,257,521,476.93
Non-current liabilities
Long-term borrowings 32 71,637,173.89 31,637,173.89
Lease liabilities 33 1,375,427,877.28 1,303,054,163.90
Long-term payables 34 6,938,189.00 6,938,189.00
Long-term employee benefits payable 35 1,202,000.00 1,319,000.00
Provisions 36 - 68,808,166.79
Deferred income 37 86,917,051.78 89,843,583.37
Deferred tax liabilities 20 175,948,328.93 205,921,408.66
Other non-current liabilities 38 664,381,065.65 740,862,989.59
Total non-current liabilities 2,382,451,686.53 2,448,384,675.20
Total liabilities 24,761,469,733.31 22,705,906,152.13
The accompanying notes form an integral part of these financial statements.
150
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED BALANCE SHEET (CONTINUED)
31 December 2021 E
LIABILITIES AND EQUITY Note V 31 December 2021 31 December 2020
Equity
Share capital 39 428,126,983.00 428,126,983.00
Capital surplus 40 4,371,802,107.43 4,372,504,053.72
Other comprehensive income 41 21,874,198.36 38,483,017.72
Surplus reserves 42 214,063,491.50 214,063,491.50
Retained earnings 43 9,889,071,272.21 8,895,145,106.39
Total equity attributable to owners of
the parent 14,924,938,052.50 13,948,322,652.33
Non-controlling interests 3,097,274,646.00 2,940,304,667.19
Total equity 18,022,212,698.50 16,888,627,319.52
Total liabilities and equity 42,783,682,431.81 39,594,533,471.65
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.
151
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED INCOME STATEMENT
Year ended 31 December 2021 E
Note V 2021 2020
Operating revenue 44 68,357,809,571.99 59,649,455,012.03
Less: Operating costs 44 60,339,298,052.24 52,591,767,464.37
Taxes and surcharges 45 169,467,568.27 154,631,447.20
Selling expenses 46 4,752,862,965.09 3,943,134,095.75
Administrative expenses 47 1,045,635,601.17 1,008,178,815.78
Finance costs 48 212,482,801.90 119,855,169.85
Including: Interest expense 288,038,760.87 258,189,163.79
Interest income 74,297,769.23 136,455,990.10
Add: Other income 49 103,418,063.10 72,363,808.19
Investment income 50 292,380,503.40 283,951,956.10
Including: Investment income from associates 333,397,116.38 354,345,705.65
Income from the derecognition of financial
assets measured at amortised cost (47,404,044.48) (76,142,835.36)
Credit impairment losses 51 (42,790,399.76) (25,975,320.08)
Impairment losses 52 (242,904,866.51) (5,179,285.75)
Gain on disposal of assets 53 4,245,372.77 6,791,962.50
Operating profits 1,952,411,256.32 2,163,841,140.04
Add: Non-operating income 54 36,364,721.36 17,660,920.58
Less: Non-operating expenses 55 13,923,128.14 24,265,611.84
Total profit 1,974,852,849.54 2,157,236,448.78
Less: Income tax expenses 58 447,210,654.67 435,940,050.06
Net profit 1,527,642,194.87 1,721,296,398.72
Net profit classified by continuing operations
Profit or loss from continuing operations 1,527,642,194.87 1,721,296,398.72
Net profit classified by attribution of ownership
Net profit attributable to owners of the parent 1,336,427,752.22 1,401,892,593.23
Non-controlling interests 191,214,442.65 319,403,805.49
Other comprehensive income, net of tax (27,708,827.55) (12,394,161.92)
Other comprehensive income, net of tax, attributable to owners of the
parent, 41 (16,608,819.36) (7,434,325.05)
Other comprehensive income that will not be reclassified to profit or
loss
Change in the fair value of other equity investments (16,650,012.28) (7,439,657.92)
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 41,192.92 5,332.87
Other comprehensive income, net of tax, attributable to non-
controlling interests 41 (11,100,008.19) (4,959,836.87)
The accompanying notes form an integral part of these financial statements.
152
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED INCOME STATEMENT (CONTINUED)
Year ended 31 December 2021 E
Note V 2021 2020
Total comprehensive income 1,499,933,367.32 1,708,902,236.80
Including:
Total comprehensive income attributable to owners of the parent 1,319,818,932.86 1,394,458,268.18
Total comprehensive income attributable to
non-controlling interests 180,114,434.46 314,443,968.62
Earnings per share 59
Basic earnings per share 3.12 3.27
Diluted earnings per share 3.12 3.27
The accompanying notes form an integral part of these financial statements.
153
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Year ended 31 December 2021 Expressed in Renminbi Yuan
Attributable to owners of the parent
2021
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 4,372,504,053.72 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
II. Changes for the year - (701,946.29) (16,608,819.36) - 993,926,165.82 976,615,400.17 156,969,978.81 1,133,585,378.98
(1) Total comprehensive income - - (16,608,819.36) - 1,336,427,752.22 1,319,818,932.86 180,114,434.46 1,499,933,367.32
(2) Owners’ contributions and
reduction in capital - (701,946.29) - - - (701,946.29) 66,531,116.93 65,829,170.64
1. Capital contributions by owners - - - - - - 26,306,656.30 26,306,656.30
2. Business combination involving
entities not under common control - - - - - - 40,224,460.63 40,224,460.63
3. Others - (701,946.29) - - - (701,946.29) - (701,946.29)
(3) Profit distribution - - - - (342,501,586.40) (342,501,586.40) (89,675,572.58) (432,177,158.98)
1.Distribution to equity owners - - - - (342,501,586.40) (342,501,586.40) (89,675,572.58) (432,177,158.98)
III.. Balance at end of year 428,126,983.00 4,371,802,107.43 21,874,198.36 214,063,491.50 9,889,071,272.21 14,924,938,052.50 3,097,274,646.00 18,022,212,698.50
The accompanying notes form an integral part of these financial statements.
154
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
Year ended 31 December 2021 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.
155
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
Year ended 31 December 2021 E
Note V 2021 2020
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the
rendering of services 71,597,279,035.48 61,701,348,065.17
Receipts of taxes and surcharges refunds 13,542,582.57 13,720,143.80
Other cash receipts relating to operating
activities 60 724,985,756.21 1,697,383,795.18
Total cash inflows from operating activities 72,335,807,374.26 63,412,452,004.15
Cash payments for goods and services 63,898,617,747.51 56,018,201,099.73
Cash payments to and on behalf of employees 3,369,629,673.47 2,708,413,782.73
Payments of all types of taxes and surcharges 1,577,115,837.20 1,512,079,139.15
Other cash payments relating to operating
activities 60 1,835,263,139.21 1,671,011,384.07
Total cash outflows from operating activities 70,680,626,397.39 61,909,705,405.68
Net cash flows from operating activities 61 1,655,180,976.87 1,502,746,598.47
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash receipts from returns of investments 2,997,441.73 19,027,649.76
Cash received from investment income 169,110,875.76 160,164,584.49
Net cash receipts from disposal of fixed assets,
intangible assets and other long-term assets 1,016,257.65 8,570,072.79
Other cash receipts relating to investing activities 60 54,984.60 24,051,674.67
Total cash inflows from investing activities 173,179,559.74 211,813,981.71
The accompanying notes form an integral part of these financial statements.
156
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
Year ended 31 December 2021 E
Note V 2021 2020
2. CASH FLOWS FROM INVESTING ACTIVITIES (Continued)
Cash payments to acquire fixed assets, intangible assets
and other long-term assets 370,430,625.89 293,826,061.63
Cash payments for investments 147,024,601.44 50,117,666.41
Net cash payments for acquisition of subsidiaries and
other business units 61 109,950,637.41 2,646,097,210.38
Other cash payments relating to investing activities 60 1,305,765.00 5,002,197.26
Total cash outflows from investing activities 628,711,629.74 2,995,043,135.68
Net cash flows from investing activities (455,532,070.00) (2,783,229,153.97)
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash proceeds from investments by others 21,206,123.00 5,700,000.00
Including: Cash receipts from capital contributions from
non-controlling interests of subsidiaries 21,206,123.00 5,700,000.00
Cash receipts from borrowings 932,684,894.52 801,520,037.57
Other cash receipts relating to financing activities 60 101,880,912.41 359,332,475.63
Total cash inflows from financing activities 1,055,771,929.93 1,166,552,513.20
Cash repayments for debts 1,007,061,372.10 427,347,200.00
Cash payments for distribution of dividends or profit and
interest expenses 672,562,452.24 613,704,450.41
Including: Dividends or profit paid to non-controlling
shareholders of subsidiaries 62,024,277.21 63,799,218.94
Other cash payments relating to financing activities 60 1,247,788,628.71 1,865,923,680.60
Total cash outflows from financing activities 2,927,412,453.05 2,906,975,331.01
Net cash flows from financing activities (1,871,640,523.12) (1,740,422,817.81)
4. EFFECT OF FOREIGN EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS 390,580.61 (52,538.86)
5. NET DECREASE IN CASH AND CASH
EQUIVALENTS (671,601,035.64) (3,020,957,912.17)
Add: Cash and cash equivalents at beginning of the year 5,405,113,257.99 8,426,071,170.16
6. CASH AND CASH EQUIVALENTS AT END OF YEAR 61 4,733,512,222.35 5,405,113,257.99
The accompanying notes form an integral part of these financial statements.
157
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET
31 December 2021 E
ASSETS Note XIV 31 December 2021 31 December 2020
Current assets
Cash and bank balances 3,098,512,437.04 3,020,909,473.71
Notes receivable 1 12,015,516.75 30,984,449.44
Accounts receivable 2 592,400,308.87 609,575,301.13
Receivables financing 3 - 30,248,631.32
Advances to suppliers 11,762,344.40 6,722,204.59
Other receivables 4 5,003,805,208.01 3,562,309,346.07
Inventories 226,490,178.26 172,275,777.63
Contract assets 139,021.45 139,154.54
Other current assets 39,482.38 39,482.38
Total current assets 8,945,164,497.16 7,433,203,820.81
Non-current assets
Long-term equity investments 5 8,044,896,142.86 7,873,668,245.16
Other non-current financial assets 135,974,908.51 120,972,350.24
Investment properties 951,035.32 1,452,132.04
Fixed assets 12,824,750.51 13,279,902.76
Right-of-use assets 4,010,087.19 5,142,755.88
Intangible assets 5,682,864.94 4,622,268.00
Long-term prepaid expenses 6,438,007.85 4,335,802.92
Deferred tax assets 10,017,097.43 9,025,057.52
Other non-current assets 26,652,335.10 12,967,715.50
Total non-current assets 8,247,447,229.71 8,045,466,230.02
Total assets 17,192,611,726.87 15,478,670,050.83
The accompanying notes form an integral part of these financial statements.
158
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET (CONTINUED)
31 December 2021 E
LIABILITIES AND SHAREHOLDERS’
Note XIV 31 December 2021 31 December 2020
EQUITY
Current liabilities
Short-term borrowings 555,138,734.59 157,892,942.24
Notes payable 596,268,853.45 756,364,719.49
Accounts payable 480,059,192.74 407,275,713.49
Contract liabilities 3,231,968.16 1,807,562.61
Employee benefits payable 36,339,296.20 36,672,344.48
Tax payables 14,768,716.45 13,975,905.04
Other payables 3,832,642,249.25 3,167,152,583.28
Non-current liabilities due within one year 1,112,137.32 1,056,120.58
Other current liabilities 837,570.27 636,200.63
Total current liabilities 5,520,398,718.43 4,542,834,091.84
Non-current liabilities
Long-term borrowings 31,637,173.89 31,637,173.89
Lease liabilities 3,343,830.66 4,455,967.97
Long-term payables 800,000.00 800,000.00
Deferred income 392,720.10 827,658.18
Other non-current liabilities 26,986,064.76 11,042.52
Total non-current liabilities 63,159,789.41 37,731,842.56
Total liabilities 5,583,558,507.84 4,580,565,934.40
The accompanying notes form an integral part of these financial statements.
159
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY BALANCE SHEET (CONTINUED)
31 December 2021 E
LIABILITIES AND SHAREHOLDERS’ EQUITY Note XIV 31 December 2021 31 December 2020
Shareholders’ equity
Share capital 428,126,983.00 428,126,983.00
Capital surplus 4,467,289,485.30 4,467,991,431.59
Other comprehensive income (86,840.40) (128,033.32)
Surplus reserves 214,063,491.50 214,063,491.50
Retained earnings 6,499,660,099.63 5,788,050,243.66
Total shareholders’ equity 11,609,053,219.03 10,898,104,116.43
Total liabilities and shareholders’ equity 17,192,611,726.87 15,478,670,050.83
The accompanying notes form an integral part of these financial statements.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY INCOME STATEMENT
Year ended 31 December 2021 E
Note XIV 2021 2020
Operating revenue 6 4,229,561,647.31 3,853,659,001.12
Less: Operating costs 6 4,064,320,850.06 3,674,872,961.34
Taxes and surcharges 5,552,059.25 6,565,048.14
Selling expenses 55,048,780.46 67,202,266.56
Administrative expenses 85,083,535.11 90,803,215.82
Finance costs (114,327,284.10) (89,275,535.72)
Including: Interest expense 54,994,093.64 45,645,501.85
Including: Interest income 171,740,832.27 137,302,390.98
Add: Other income 3,731,248.01 4,977,883.40
Investment income 7 955,848,072.40 969,166,523.86
Including: Investment income from
associates 333,164,462.64 353,352,207.87
Income from the
derecognition of
financial assets
measured at amortised
cost (206,333.75) (1,796,917.66)
Credit impairment losses (3,427,601.84) (965,769.74)
Impairment losses (1,274,168.04) (500,485.27)
Gain on disposal of assets 119,379.12 (165.97)
Operating profits 1,088,880,636.18 1,076,169,031.26
Add: Non-operating income 649,755.23 1,925.53
Less: Non-operating expenses 3,043,885.49 388,863.31
Total profit 1,086,486,505.92 1,075,782,093.48
Less: Income tax expenses 32,375,063.55 27,039,917.36
Net profit 1,054,111,442.37 1,048,742,176.12
Including: Profit or loss from continuing operations 1,054,111,442.37 1,048,742,176.12
Other comprehensive income, net of tax 41,192.92 5,332.87
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 41,192.92 5,332.87
Total comprehensive income 1,054,152,635.29 1,048,747,508.99
The accompanying notes form an integral part of these financial statements.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CHANGES IN EQUITY
Year ended 31 December 2021 Expressed in Renminbi Yuan
Other comprehensive
2021 Share capital Capital surplus Surplus reserves Retained earnings Total equity
income
I. Balance at end of prior 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
II. Changes for the year - (701,946.29) 41,192.92 - 711,609,855.97 710,949,102.60
(1) Total comprehensive income - - 41,192.92 - 1,054,111,442.37 1,054,152,635.29
(2) Owners’ contributions and reduction in capital - (701,946.29) - - - (701,946.29)
1. Others - (701,946.29) - - - (701,946.29)
(3) Profit distribution - - - - (342,501,586.40) (342,501,586.40)
1. Distribution to owners - - - - (342,501,586.40) (342,501,586.40)
III. Balance at end of year 428,126,983.00 4,467,289,485.30 (86,840.40) 214,063,491.50 6,499,660,099.63 11,609,053,219.03
The accompanying notes form an integral part of these financial statements.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CHANGES IN EQUITY (CONTINUED)
Year ended 31 December 2021 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CASH FLOWS
Year ended 31 December 2021 E
Note XIV 2021 2020
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the
rendering of services 4,482,924,175.09 4,009,125,652.17
Other cash receipts relating to operating
activities 64,151,272.51 152,617,741.86
Total cash inflows from operating activities 4,547,075,447.60 4,161,743,394.03
Cash payments for goods and services 4,246,556,694.01 3,813,436,197.34
Cash payments to and on behalf of employees 95,803,718.56 94,005,053.76
Payments of all types of taxes and surcharges 76,032,450.12 87,642,227.22
Other cash payments relating to operating
activities 28,369,766.73 69,706,005.74
Total cash outflows from operating activities 4,446,762,629.42 4,064,789,484.06
Net cash flows from operating activities 100,312,818.18 96,953,909.97
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash receipts from returns of investments 2,997,441.73 32,664,096.76
Cash receipts from investment income 781,665,378.58 753,109,725.64
Net cash receipts from disposal of fixed assets,
intangible assets and other long-term assets 423,563.00 20,210.00
Other cash receipts relating to investing
activities 5,195,613,459.25 2,774,679,815.57
Total cash inflows from investing activities 5,980,699,842.56 3,560,473,847.97
Cash paid for acquisition of fixed assets,
intangible assets and other long-term assets 7,415,164.06 13,691,557.76
Cash payments for investments 18,000,000.00 -
Other cash payments relating to investing
activities 6,509,461,277.00 4,372,908,047.02
Total cash outflows from investing activities 6,534,876,441.06 4,386,599,604.78
Net cash flows from investing activities (554,176,598.50) (826,125,756.81)
The accompanying notes form an integral part of these financial statements.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
COMPANY STATEMENT OF CASH FLOWS (CONTINUED)
Year ended 31 December 2021 E
Note XIV 2021 2020
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash receipts from borrowings 280,000,000.00 63,864,821.52
Other cash receipts relating to financing
activities 44,512,657,890.34 35,223,164,337.16
Total cash inflows from financing activities 44,792,657,890.34 35,287,029,158.68
Cash repayments for debts 30,164,821.52 43,700,000.00
Cash payments for distribution of dividends,
profit or interest expenses 394,368,619.63 308,496,896.99
Other cash payments relating to financing
activities 43,837,048,286.15 34,079,032,358.66
Total cash outflows from financing activities 44,261,581,727.30 34,431,229,255.65
Net cash flows from financing activities 531,076,163.04 855,799,903.03
4. EFFECT OF FOREIGN EXCHANGE RATE
CHANGES ON CASH AND CASH
EQUIVALENTS 390,580.61 (52,538.86)
5. NET INCREASE IN CASH AND CASH
EQUIVALENTS 77,602,963.33 126,575,517.33
Add: Cash and cash equivalents at beginning of
the year 3,020,909,473.71 2,894,333,956.38
6. CASH AND CASH EQUIVALENTS AT END OF
YEAR 3,098,512,437.04 3,020,909,473.71
The accompanying notes form an integral part of these financial statements.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS
Year ended 31 December 2021
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 2021.
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 Sinopharm Holding 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
I Profile of the Company (Continued)
As of 31 December 2021, 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 28 March 2022.
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 2021
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.
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 2021, 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 2021
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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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021
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 2021
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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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 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 realizable value.
The inventories are written down below cost to net realizable value and the write-down is
recognised in profit or loss if the cost is higher than the net realizable value. When the
circumstances that previously caused the inventories to be written down below cost no longer
exist, in which case the net realizable 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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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021
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 Annual depreciation
value (amortisation) rates
Buildings and
constructions 5-35 years 0-5% 2.71-19.00%
40-50 years or no fixed
Land use rights
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 2021
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 20-35 years 3-5% 2.71-4.85%
Machinery 5-14 years 3-5% 6.79-19.40%
Motor vehicles 3-10 years 5% 9.50-31.67%
Office equipment 3-10 years 5% 9.50-31.67%
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.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
182
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 brand 10 years or no fixed useful life
use rights
Distribution network 10-20 years
Franchise 10 years
Favourable 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
labour 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 benefits 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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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, Consulting and other medical services.
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.
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CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
192
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
193
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
194
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
195
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
196
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 see 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.
197
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2022;
(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
198
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
199
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
200
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
201
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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.
202
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 Notes V (13), (14), (15), (16)
and (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
203
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
the transaction price to be allocated to the loyalty points based on the stand-alone selling price
of the re-evaluated loyalty points.
204
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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. 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.
205
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
III Summary of significant accounting policies and accounting estimates (Continued)
34. Changes in accounting policies and accounting estimates
Changes in accounting policies
Changes in adoption 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 in 2020. According to the changes in appliance
scope of the accounting process regulations on rent concessions related to COVID-19, the rent
concession period applicable to the simplified method is adjusted to "the concession is only for
the lease payments payable incurred before June 30, 2022". As a lessee, the adoption of the
simplified method after the adjustment of the changes of the appliance scope is consistent with
it before the change for the relevent leases. The amount of rent concessions included in the
profit for the year is RMB2,617,562.37.
206
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
IV Taxation
1. Main categories and rates of taxes:
Categories Tax base Tax rate
Corporate income tax
(“CIT”) Taxable income 15%, 20%, 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 0%, 3%, 5%, 6%, 9%, 10%,
Value-added tax (“VAT”) current period) 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”), Ningxia Guoda Pharmacy Chain Co., Ltd. (“Guoda Ningxia”) and Sinopharm
Holding Guoda Drugstore Guangxi Chain Co., Ltd. (“Guoda Guangxi”), subsidiaries of the
Company, were approved to enjoy a tax concession for Western Development at a reduced
CIT rate of 15%. 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) and the Announcement
on the continuation of the income tax policy for the enterprise in Western Region
Development (Cai Zheng Bu [2020] No.23), enterprises could enjoy a reduced CIT rate of
15% from 1 January 2011 to 31 December 2030.
In 2014, the Company’s subsidiary, Sinopharm Guangxi, Sinopharm Holding Guangxi
Logistics Co., Ltd. (“Sinopharm Guangxi Logistics”), Sinopharm Holding Liuzhou Co., Ltd.
(“Sinopharm Liuzhou”) and Sinopharm Holding Beihai Co., Ltd. (“Sinopharm Beihai”) were
approved to enjoy a tax concession for Western Development at a reduced CIT rate of 15%.
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) and the Announcement on the
continuation of the income tax policy for the enterprise in Western Region Development (Cai
Zheng Bu [2020] No.23), enterprises above could enjoy a reduced CIT for Western Regions
from 1 January 2011 to 31 December 2030.
207
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
IV Taxation (Continued)
2. Tax preferences (Continued)
In 2015, subsidiaries of the Company, including 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
approved to enjoy a tax concession for Western Development at a reduced CIT rate of 15%.
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) and the Announcement on the
Continuation of the Income Tax Policy for the Enterprise in Western Region Development
(Cai Zheng Bu [2020] No.23), the applicable period is from 1 January 2015 to 31 December
2030.
In 2017, according to Cai Shui [2011] No.58 and the Announcement on the Continuation of
the Income Tax Policy for the Enterprise in Western Region Development (Cai Zheng Bu
[2020] No.23), Sinopharm Holding Guoda Inner Mongolia Pharmacy Chain Store Co., Ltd.
(“Guoda Inner Mongolia”) and Inner Mongolia Guoda Medicine Co., Ltd. (“Inner Mongolia
Medicine”) could enjoy a reduced CIT rate of 15% from 1 January 2017 to 31 December
2030.
In 2019, according to Cai Shui [2011] No.58 and the Announcement on the Continuation of
the Income Tax Policy for the Enterprise in Western Region Development (Cai Zheng Bu
[2020] No.23), Sinopharm Holding Qinzhou Co., Ltd. (“Sinopharm Qinzhou”), Sinopharm
Holding Hezhou Co., Ltd. (“Sinopharm Hezhou”), Sinopharm Holding Hechi Co., Ltd.
(“Sinopharm Hechi”), Guoda Pharmacy (Pu’er) Songmao Co., Ltd. (“Guoda Pu’er”) could
enjoy a reduced CIT rate of 15% from 1 January 2019 to 31 December 2030.
In 2021, according to Cai Shui [2011] No.58 and the Announcement on the Continuation of
the Income Tax Policy for the Enterprise in Western Region Development (Cai Zheng Bu
[2020] No.23), Yunnan Guoda Disheng Pharmacy Chain Co., Ltd. (“Disheng Pharmacy
Chain”), Yunnan Guoda Disheng Medicine Co., Ltd. ("Disheng Medicine"), Sinopharm
Holding Medical Supply Chain Service (Guangxi) Co., Ltd. could enjoy a reduced CIT rate of
15% from 1 January 2021 to 31 December 2030.
In 2021, according to the Notice on the Implementation of Inclusive Tax Reduction and
Exemption Policies for Small and Micro Enterprises (Cai Shui [2019] No.13) and
Announcement of the Ministry of Finance and the State Administration of Taxation on the
Implementation of Preferential Income Tax Policies for Small and Micro Enterprises and
Individual Industrial and Commercial Households ([2021] No.12), subsidiaries of the
Company listed below qualified for the conditions of small low-profit enterprises, which the
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
of 12.5%, 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 of 50%, and enterprise income tax shall be paid at the rate of 20%.
208
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
IV Taxation (Continued)
3. Tax preferences (Continued)
The Company’s subsidiaries which qualified for the conditions of small low-profit enterprises
including Sinopharm Holding Guigang Pharmacy Co., Ltd. (“Sinopharm Guigang Pharmacy”),
Shanghai Guoda Dongsheng Pharmacy Co., Ltd. (“Shanghai Dongsheng”), Shanghai Guoda
Ruijing Pharmacy Co., Ltd. (“Shanghai Ruijing”), Sinopharm Holding Guoda Pharmacy
Ulanqab Co., Ltd. (“Guoda Ulanqab”), Shanghai Guoda Dongxin Pharmacy Co., Ltd.
(“Shanghai Dongxin”), Shanghai Guoda Shanghong Qibao Pharmacy Co., Ltd. (“Shanghai
Shanghong”), Shanghai Guodong Traditional Chinese Medicine Clinic Co., Ltd. (“Shanghai
Guodong”), Sinopharm Guoda Yongsheng Pharmacy (Shanghai) Co., Ltd. (“Guoda
Yongsheng”), Guoda Pharmacy Manchuria Co., Ltd.(“Guoda Manchuria”), Zhejiang
Sinopharm Pharmacy Dongshan Pharmacy Co., Ltd. (“Zhejiang Dongshan”), Sinopharm
Holding Guoda Pharmacy Guangzhou Chain Co., Ltd. (“Guoda Guangzhou”), Taishan
Sinopharm Holding Guoda Qunkang Pharmacy Chain Store Co., Ltd. (“Guoda Taishan”),
Guoda Pharmacy (Rizhao) Co., Ltd. (“Guoda Rizhao”), Sinopharm Holding Guoda Pharmacy
Hulun Buir Co., Ltd. (“Guoda Hulun Buir”), Sinopharm Holding Guoda Pharmacy Bayannur
Co., Ltd. (“Guoda Bayannur”), Sinopharm Holding Baiyi Pharmacy Guangxi Co., Ltd. (“Baiyi
Pharmacy”), Sinopharm Accord (Guangzhou) Medicine Co., Ltd.(“Guangzhou Medicine”),
Guangxi Guoda Pharmaceutical Consulting Chain Co., Ltd. (“Guangxi Consulting”), Liaoning
Guoda Health Pharmacy Co., Ltd. (“Liaoning Health Pharmacy”), Liaoning Huludao Guoda
Pharmacy Co., Ltd. (“Liaoning Huludao”), Changzhi Wanmin Drug Store Co., Ltd. (“Changzhi
Wanmin”), Shanxi Guoda Wanmin Chain Clinic Management Co., Ltd. (“Wanmin Chain”),
Guoda Wanmin Huimin Kangwei Pharmacy Lvliang Co., Ltd. (“Huimin Lvliang”), Shanghai
Fumei Xuhui Pharmacy Co., Ltd. (“Fumei Xuhui”), Jilin Donglong Pharmaceutical Logistics
Co., Ltd. (“Jilin Donglong”), Shanghai Pudong Yanghetang Traditional Chinese Medicine
Clinic Co., Ltd. (“Pudong Yanghetang”), Yanji Xianghe Medicine Co., Ltd. (“Yanji Xianghe”),
Hebei Chengda Fangyuan Medicine Chain Co., Ltd. (“Hebei Chengda Fangyuan”), Shandong
Chengda Fangyuan Medicine Chain Co., Ltd. (“Shandong Chengda Fangyuan”), Liaoning
Chengda Fangyuan Technical Training School, and Dalian Zhengda Pharmaceutical Co., Ltd.
(“Dalian Zhengda”), etc.
209
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements
1. Cash and bank balances
31 December 2021 31 December 2020
Cash on hand 4,642,730.62 6,707,125.90
Cash at banks 4,728,869,491.73 5,398,406,132.09
Other cash balances (1) 392,646,858.59 593,091,037.88
5,126,159,080.94 5,998,204,295.87
Including: Total amount restricted for
use due to mortgage, pledge or
freezing, etc. - 66,956,993.60
(1) As at 31 December 2021, the Group's other cash balance includes: RMB351,801,571.62 (31
December 2020: RMB492,734,978.75) is deposits for bank acceptance bills, which is a certain
amount of deposit paid when drawing bank acceptance bills; RMB 11,456,766.10 (31 December,
2020: RMB27,465,331.50) is medical reserve funds for emergency medical supplies, which is
supervised by the bank; RMB29,388,520.87 (31 December, 2020: RMB72,890,727.63. RMB
66,956,993.60 is freezing bank deposits due to litigation, which was unfrozen in 2021) is the
other restricted cash balances.
As at 31 December 2021 and 31 December 2020, the Group has no cash and bank balances
deposited abroad.
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 2021 31 December 2020
Bank acceptance bills 32,490,612.49 -
Commercial acceptance bills 647,705,768.08 623,594,997.36
680,196,380.57 623,594,997.36
Less: Bad debt provision for notes
receivable - 1,479,520.32
680,196,380.57 622,115,477.04
210
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which provision
for bad debts is
recognised by group
(credit risk
characteristics) 680,196,380.57 100% - - 680,196,380.57
680,196,380.57 100% - - 680,196,380.57
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
211
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
2. Notes receivable (Continued)
At 31 December 2021, the Group had no individual provision for bad debts on notes receivable.
At 31 December 2020, notes receivable that are individually assessed for provisions are as follows:
Expected credit
Carrying amount Bad debt provision loss rate Assessment for impairment
The drawer has historical
credit defaults; the notes
receivable are expected to
Client A 25,673,156.00 (1,471,457.31) 5.73% be at risk of reclaim.
The drawer has historical
credit defaults; the notes
receivable are expected to
Client B 1,961,699.48 (8,063.01) 0.41% be at risk of reclaim.
27,634,855.48 (1,479,520.32)
Changes in provision for bad debts on notes receivable are presented as follows:
Opening Increase Reversal Closing
balance in the year in the year balance
2021 1,479,520.32 - (1,479,520.32) -
2020 - 1,479,520.32 - 1,479,520.32
As at 31 December 2021 and 31 December 2020, 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 2021 and 31 December 2020 are as follows:
31 December 2021 31 December 2020
Derecognised Not Derecognised Not
derecognised derecognised
Bank acceptance
bills - 31,886,681.19 - -
Commercial
acceptance bills - - - 4,095,283.92
31,886,681.19 4,095,283.92
212
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
2. Notes receivable (Continued)
As at 31 December 2021 and 31 December 2020, 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 2021 31 December 2020
Commercial acceptance bills 8,647,245.81 2,276,824.52
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 2021 31 December 2020
Within 1 year 15,860,578,973.02 13,575,070,031.31
1 to 2 years 181,098,453.86 263,187,281.70
2 to 3 years 26,520,111.62 31,013,755.63
Over 3 years 27,828,171.64 23,213,398.71
16,096,025,710.14 13,892,484,467.35
Less: Bad debt provision for accounts
receivable 131,422,364.23 92,513,453.13
15,964,603,345.91 13,799,971,014.22
213
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021
Carrying amount Bad debt provisions Book value
Amount Proportion Amount Proportion
Items for which provision
for bad debts is
recognised individually 1,154,059,084.62 7.17% (78,449,701.36) 6.80% 1,075,609,383.26
Items for which provision
for bad debts is
recognised by group
(credit risk
characteristics) 14,941,966,625.52 92.83% (52,972,662.87) 0.35% 14,888,993,962.65
16,096,025,710.14 100.00% (131,422,364.23) 0.82% 15,964,603,345.91
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
214
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
At 31 December 2021, accounts receivable that are individually significant and individually assessed
for provisions are as follows:
Expected credit
Carrying amount Bad debt provision loss rate Assessment for impairment
Receivable of The receivable of medical insurance
medical insurance 831,256,560.02 (8,047,617.79) 0.97% has lower-tier default risk.
The debtor had irregular operations
subject to severe financial
difficulties, and is related to multiple
lawsuits, with lower-tier
Client A 50,201,932.55 (50,201,932.55) 100.00% recoverability.
The debtor had irregular operations
subject to severe financial
difficulties, and is related to multiple
lawsuits, with lower-tier
Client B 11,559,178.29 (11,559,178.29) 100.00% recoverability.
The debtor had irregular operations
subject to severe financial
difficulties, and is in bankruptcy
Client C 2,447,976.74 (2,447,976.74) 100.00% liquidation.
Part of the receivables takes longer
than usual to recover, and has risk
Others 258,593,437.02 (6,192,995.99) 2.39% of recoverability.
1,154,059,084.62 (78,449,701.36)
215
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
At 31 December 2020, accounts receivable that were individually significant and individually
assessed for provisions are as follows:
Expected
Carrying amount Bad debt provision credit loss 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 subject to severe
financial difficulties, and
related to multiple lawsuits,
Client A 11,559,178.29 (11,559,178.29) 100.00% with lower-tier recoverability.
The debtor had irregular
operations subject to severe
financial difficulties, and has
been placed on a national list
of defaulters, with a high risk
of bankruptcy or financial
Client B 2,447,976.74 (2,447,976.74) 100.00% restructuring.
The debtor had irregular
operations subject to severe
financial difficulties, and has
been placed on a national list
of defaulters, with a high risk
of going bankruptcy or
Client C 2,365,253.03 (2,365,253.03) 100.00% financial restructuring.
Part of the receivables 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)
The accounts receivable for which the Group recognised provision for bad debts by credit risk characteristics are presented
as follows:
31 December 2021 31 December 2020
Estimated gross Expected Estimated gross Expected
carrying amount at credit loss Lifetime carrying amount at credit loss Lifetime expected
default ratio expected credit loss default ratio credit loss
Within 1 year 14,735,394,393.03 0.24% (36,032,738.61) 12,930,648,987.23 0.20% (26,043,994.99)
1 to 2 years 180,285,029.67 5.46% (9,848,846.12) 257,905,763.20 11.04% (28,463,763.63)
2 to 3 years 20,156,291.29 22.24% (4,482,412.04) 21,112,155.47 17.39% (3,671,293.61)
Over 3 years 6,130,911.53 42.55% (2,608,666.10) 8,446,784.70 60.50% (5,110,469.45)
14,941,966,625.52 (52,972,662.87) 13,218,113,690.60 (63,289,521.68)
216
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
2021 92,513,453.13 - 58,049,541.91 183,384.10 (14,558,622.63) (4,765,392.28) 131,422,364.23
2020 45,916,730.47 167,797.87 29,942,655.08 25,219,814.78 (8,733,545.07) - 92,513,453.13
Accounts receivable written off in 2020 are analysed below:
Nature of the Related party
receivable Amount Reason Write-off procedures transaction or not
The write-off procedures have
been completed in accordance
with the internal rules and
Client A Payment for goods 2,161,120.00 Non-recoverable regulations. No
The write-off procedures have
been completed in accordance
with the internal rules and
Client B Payment for goods 1,137,547.24 Non-recoverable regulations. No
The write-off procedures have
been completed in accordance
with the internal rules and
Client C Payment for goods 862,818.55 Non-recoverable regulations. No
The write-off procedures have
been completed in accordance
with the internal rules and
Client D Payment for goods 356,510.26 Non-recoverable regulations. No
The write-off procedures have
been completed in accordance
with the internal rules and
Others Payment for goods 247,396.23 Non-recoverable regulations. No
4,765,392.28
Accounts receivable written off in 2020 were nil.
As at 31 December 2021, the five largest accounts receivable analysed by customer are summarised below:
% of the total accounts
Amount Bad debt provision amount receivable
Top 1 account receivable 222,417,747.86 (1,369,997.89) 1.38%
Top 2 account receivable 221,550,040.23 (2,513,061.33) 1.38%
Top 3 account receivable 170,639,289.87 (131,398.98) 1.06%
Top 4 account receivable 162,489,077.59 (2,071,467.64) 1.01%
Top 5 account receivable 121,263,417.42 (986,163.48) 0.75%
898,359,572.97 (7,072,089.32) 5.58%
217
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
3. Accounts receivable (Continued)
As at 31 December 2020, the five largest accounts receivable analysed by customer are
summarised below:
Bad debt provision % of the total accounts
Amount 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%
In 2021, the Group factored a portion of accounts receivable at amortised cost to financial
institutions. The amount of accounts receivable derecognised was RMB3,529,795,916.53 (2020:
RMB5,131,305,168.48), and the amount of loss recognised through investment income was
RMB47,404,044.48 (2020: RMB76,142,835.36).
4. Receivables financing
31 December 2021 31 December 2020
Bank acceptance bills 1,027,226,940.21 1,404,987,700.38
The pledged receivables financings are as follows:
31 December 2021 31 December 2020
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 2021 and 31 December 2020 are as follows:
31 December 2021 31 December 2020
Derecognised Not Derecognised Not
derecognised derecognised
Bank acceptance bills 2,206,355,117.26 - 1,613,842,670.80 -
As at 31 December 2021 and 31 December 2020, no receivables financing were converted into
accounts receivable due to the ticket issuer’s inability to settle the notes on the maturity date.
218
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
5. Advances to suppliers
The age of advances to suppliers is analysed below:
31 December 2021 31 December 2020
Amount % of total balance Amount % of total balance
Within 1 year 519,225,204.09 99.67% 480,215,111.42 99.98%
1 to 2 years 1,705,341.22 0.33% 42,225.29 0.01%
2 to 3 years - - 56,238.00 0.01%
Over 3 years - - - -
520,930,545.31 100.00% 480,313,574.71 100.00%
As at 31 December 2021, the five largest advances to suppliers analysed by customer are
summarised below:
Amount Proportion of total balance
Total amount of the five largest
advances to suppliers 105,978,569.71 20.34%
As at 31 December 2020, the five largest advances to suppliers analysed by customer are
summarised below:
Amount Proportion of total balance
Total amount of the five largest
advances to suppliers 41,313,738.82 8.60%
219
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
6. Other receivables
31 December 2021 31 December 2020
Other receivables 718,089,129.10 535,228,747.69
The age of other receivables is analysed below:
31 December 2021 31 December 2020
Within 1 year 641,647,280.72 480,713,606.60
1 to 2 years 35,719,505.98 41,156,242.37
2 to 3 years 30,667,461.83 57,236,236.46
Over 3 years 78,599,676.64 25,311,879.53
786,633,925.17 604,417,964.96
Less: Bad debt provision for other
receivables 68,544,796.07 69,189,217.27
718,089,129.10 535,228,747.69
220
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
Categories of other receivables by nature are as follows:
31 December 2021 31 December 2020
Deposits 294,949,777.43 287,130,364.44
Pending refunds 129,688,000.00 -
Receivable of price reduction compensation
and purchasing rebates 77,286,467.71 85,263,225.16
Receivable of the pharmaceutical electronic
trading and other platforms 67,123,290.09 60,267,511.03
Entrusted borrowings 46,334,222.24 46,334,222.24
Petty cash advance to employees 20,107,746.36 22,994,684.93
Receivable of equity transactions 8,980,000.00 8,980,000.00
Receivable due from related parties 2,412,959.70 2,867,594.20
Others 139,751,461.64 90,580,362.96
786,633,925.17 604,417,964.96
Less: Bad debt provision for other receivables 68,544,796.07 69,189,217.27
718,089,129.10 535,228,747.69
221
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021
Stage 1 Stage 2 Stage 3 Total
12-month Lifetime Credit-impaired
expected expected financial assets
credit credit losses (Lifetime
losses expected credit
losses)
Balance at 1 January 2021 - 7,305,149.90 61,884,067.37 69,189,217.27
Balance at 1 January 2021 during the period - - - -
--Transfer to phase II - - - -
--Transfer to phase III - - - -
--Transfer to phase III - - - -
--Back to phase II - - - -
--Back to phase I - - - -
Provisions during the period - 3,402,082.28 6,248,210.57 9,650,292.85
Reversal during the period - (7,815,244.23) (1,288,514.82) (9,103,759.05)
Transfer out during the period - - - -
Write-off during the period - - (1,190,955.00) (1,190,955.00)
Addition due to combination - -
Reversal of write-off in previous years - - - -
Balance at 31 December 2021 - 2,891,987.95 65,652,808.12 68,544,796.07
222
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2020
Stage 1 Stage 2 Stage 3 Total
12- Lifetime Credit-impaired
month expected financial assets
expected credit losses (Lifetime
credit expected credit
losses 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 phase II - - - -
--Transfer to phase III - - - -
--Transfer to phase III - - - -
--Back to phase I - - - -
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)
Write-back 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
The bad debt provision amount of other receivables in 2021 was RMB9,650,292.85 (2020:
RMB6,234,313.07), with the recovered or reversed amount of RMB9,103,759.05 (2020:
RMB2,947,623.32).
The write-off amount of other receivables in 2021 was RMB1,190,955.00 (2020: RMB128,028.03).
223
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
As at 31 December 2021, the 5 parties that owed the largest amounts of other receivable balances are
analysed below:
% of total Provision of bad
Amount amount Nature Age debts
Amount to be Within
Octapharma AG（1） 129,688,000.00 16.49% returned 1 year -
Repayment not yet c
leared from the
Guangdong Pharmaceutical pharmaceutical Within
electronic trading platform 57,211,999.38 7.27% trading platform 1 year -
Sinopharm Group Zhijun (Suzhou)
Pharmaceutical Co., Ltd. (“Zhijun Over 3
Suzhou”) (1) 46,334,222.24 5.89% Entrusted borrowings years 46,334,222.24
Shenzhen Center for Disease Within
Control and Prevention 44,509,322.63 5.66% Vaccine distribution 1 year -
Deposit from a
TCM-Integrated Hospital of Southern logistics extension Over 3
Medical University 20,000,000.00 2.54% service project years -
297,743,544.25 37.85% 46,334,222.24
As at 31 December 2020, the 5 parties that owed the largest amounts of other receivable balances are
analysed below:
% of total Provision of
Amount amount Nature Age bad debts
Repayment not
yet cleared from
Guangdong Pharmaceutical the pharmaceutical Within
electronic trading platform 46,564,683.73 7.70% trading platform 1 year -
Entrusted 2 to 3
Zhijun Suzhou 46,334,222.24 7.67% borrowings years 46,334,222.24
Receivable of price
reduction
AstraZeneca (Wuxi) Trading compensation and Within
Co., Ltd. 22,486,430.15 3.72% purchasing rebates 1 year -
Deposit from a
TCM-Integrated Hospital of logistics extension Over 3
Southern Medical University 20,000,000.00 3.31% service project years -
Changchun Society Medical Medical insurance Within
Insurance Management Bureau 15,552,920.92 2.57% deposit 1 year -
150,938,257.04 24.97% 46,334,222.24
(1) The payment was made in advance to Octapharma AG of Switzerland for the purchase of human
albumin. Due to the shortage of supply, both agreed to terminate the original contract and return
the amount. The amount was refunded in January 2022.
(2) Due to the poor operation of Zhijun Suzhou, the solvency of the loan decreased and the credit risk
increased, the Company made a full provision for bad debts on this entrusted loan out of
prudence.
224
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
6. Other receivables (Continued)
As at 31 December 2020, the amount of government grants receivable is analysed below:
Grants program Amount Age Estimated collection time, amount and basis
The amount of government grants
Shanghai Pudong receivable has been approved and
Finance Bureau Financial subsidy 1,260,000.00 Within 1 year expected to be fully received in 2022.
There were no government grants receivable in 2020.
7. Inventories
Inventories by category are analysed below:
31 December 2021 31 December 2020
Book value Provision Net book value Book value Provision Net book value
Raw materials 3,771,510.04 - 3,771,510.04 1,959,948.73 - 1,959,948.73
Finished goods 7,623,665,381.94 (11,100,942.38) 7,612,564,439.56 6,292,866,195.61 (12,997,334.35) 6,279,868,861.26
Work in progress 268,702.16 - 268,702.16 244,341.19 - 244,341.19
Low cost consumables 4,936,943.32 - 4,936,943.32 2,937,523.28 - 2,937,523.28
7,632,642,537.46 (11,100,942.38) 7,621,541,595.08 6,298,008,008.81 (12,997,334.35) 6,285,010,674.46
Provision for inventories is analysed below:
31 December
Increases Decreases 2021
Addition due to
31 December 2021 1 January 2021 Current combination Resale Write-off Others
Finished goods 12,997,334.35 9,558,490.52 314,857.50 (5,569,754.67) (2,217,220.21) (3,982,765.11) 11,100,942.38
Increases Decreases
Addition due to 31 December
31 December 2020 1 January 2020 Current combination Resale Others 2020
Finished goods 8,902,200.40 7,054,810.15 474,033.43 (1,458,197.19) (1,975,512.44) 12,997,334.35
In 2021, due to the sales of goods in stock, provision for inventories was resold by
RMB5,569,754.67 (2020: RMB1,458,197.19).
225
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
8. Contract assets
31 December 2021 31 December 2020
Book value Provision Net book value Book value Provision Net book value
Medical devices
and equipment’s
warranty 29,571,543.27 (510,383.75) 29,061,159.52 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 balance Increase in the year Reversal in the year Closing balance
2021 17,799.31 501,422.56 (8,838.12) 510,383.75
2020 - 17,799.31 - 17,799.31
An age analysis of contract assets with provision for impairment are as follows:
31 December 2021 31 December 2020
Estimated Expected credit Expected
default Expected credit loss in entire Estimated default credit loss Expected credit loss in
amount loss rate lifetime amount rate entire lifetime
Within 1 year 24,362,618.02 0.76% 185,529.29 15,195,530.95 0.12% 17,799.31
1 to 2 years 5,208,925.25 6.24% 324,854.46 - - -
29,571,543.27 1.73% 510,383.75 15,195,530.95 0.12% 17,799.31
9. Other current assets
31 December 2021 31 December 2020
VAT tax credit 155,985,552.00 114,251,111.76
CIT to be deducted 3,817,409.16 5,981,268.15
Others 804,394.50 850,483.54
160,607,355.66 121,082,863.45
226
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
10. Long-term equity investments
2021
Changes in the year Amount of provision for
31 December 2021
impairment
Investee 1 January 2021 Additional / reduced Profit or loss under Changes in other Other changes in Cash dividends or
Investment the equity method comprehensive equity profits declared for
income distribution
Shenzhen Main Luck Pharmaceutical Inc. (“Main Luck Pharmaceutical”) (a)
322,696,745.87 - 88,173,434.93 - - (70,380,000.00) 340,490,180.80 -
Shanghai Beiyi Guoda Pharmaceutical Co. Ltd. (“Shanghai Beiyi”) (b)
11,190,188.07 - 1,249,450.80 - - (1,154,400.00) 11,285,238.87 -
Shanghai Liyi Pharmacy Co., Ltd. (“Shanghai Liyi”) (c)
1,147,948.30 - 226,367.96 - - (293,232.69) 1,081,083.57 -
Shanghai Renbei Pharmacy Co., Ltd. (“Shanghai Renbei”) (d) 2,465,103.92 38,421.50 - - - 2,503,525.42 -
Dongyuan Accord Pharmaceutical Chain Co., Ltd. (“Dongyuan Accord”) (e)
396,638.32 - - - - - 396,638.32 (396,638.32)
Sinopharm Jienuo Medical Treatment Service Guangdong Co., Ltd.
(“Guangdong Jienuo”) (f) 5,225,570.12 (871,691.80) - - - 4,353,878.32 -
Guangdong Jianhui Construction Investment Management Co., Ltd.
(“Guangdong Jianhui”) (g) 8,000,000.00 - - - - - 8,000,000.00 -
Zhijun Suzhou (h) 1,857,279.52 - - - - - 1,857,279.52 (1,857,279.52)
Sinopharm Group Zhijun (Shenzhen) Pharmaceutical Co., Ltd.
(“Zhijun Medicine”) (i) 425,557,825.11 - 110,083,777.09 - - (39,098,661.04) 496,542,941.16 -
Shenzhen Zhijun Pharmaceutical Trade Co., Ltd. (“Zhijun Trade”) (i) 10,408,675.18 - 498,196.67 - - (529,453.96) 10,377,417.89 -
Sinopharm Group Zhijun (Shenzhen) PingShan Pharmaceutical Co., Ltd.
(“Zhijun Pingshan”) (i) 176,566,795.90 - 41,892,944.28 - - (34,553,476.37) 183,906,263.81 -
Shanghai Shyndec Pharmaceutical Co., Ltd. (“Shyndec Pharma”) (i) 1,323,760,775.52 - 92,516,109.67 41,192.92 (701,946.29) (16,714,220.20) 1,398,901,911.62 -
Jialong (Hainan) Health Management Group Co., Ltd (“Jialong Hainan”) (j) 2,800,000.00 (409,894.72) - - - 2,390,105.28 -
2,289,273,545.83 2,800,000.00 333,397,116.38 41,192.92 (701,946.29) (162,723,444.26) 2,462,086,464.58 (2,253,917.84)
227
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
9. Long-term equity investments (Continued)
2020
Changes in the year Amount of provision for
31 December 2020
impairment
Investee 1 January 2020 Additional / reduced Profit or loss under Changes in other Other changes in Cash dividends or
Investment the equity method comprehensive equity profits declared for
income distribution
Main Luck Pharmaceutical (a) 294,469,367.27 - 91,569,378.60 - - (63,342,000.00) 322,696,745.87 -
Shanghai Beiyi (b) 9,887,944.98 - 1,302,243.09 - - - 11,190,188.07 -
Shanghai Liyi (c) 1,039,039.88 - 108,908.42 - - - 1,147,948.30 -
Shanghai Renbei (d) 1,800,000.00 665,103.92 - - - 2,465,103.92 -
Dongyuan Accord (e) 396,638.32 - - - - - 396,638.32 (396,638.32)
Guangdong Jienuo (f) 6,453,679.96 (1,228,109.84) - - - 5,225,570.12 -
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 (1,857,279.52)
Zhijun Medicine (i) 400,578,574.68 - 78,197,322.08 - - (53,218,071.65) 425,557,825.11 -
Zhijun Trade (i) 10,275,257.61 - 1,176,564.36 - - (1,043,146.79) 10,408,675.18 -
Zhijun Pingshan (i) 120,878,018.74 - 76,785,503.04 - - (21,096,725.88) 176,566,795.90 -
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 Enterprise Management Consulting Co., Ltd.
(“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) 2,289,273,545.83 (2,253,917.84)
228
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
229
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
9. Long-term equity investments (Continued)
Provision for impairment of long-term equity investments:
2021
1 January 2021 Increase Decrease 31 December 2021
Zhijun Suzhou (h) 1,857,279.52 - - 1,857,279.52
Dongyuan Accord (e) 396,638.32 - - 396,638.32
2,253,917.84 - - 2,253,917.84
2020
1 January 2020 Increase Decrease 31 December 2020
Zhijun Suzhou (h) 1,857,279.52 - - 1,857,279.52
Dongyuan Accord (e) 396,638.32 - - 396,638.32
2,253,917.84 - - 2,253,917.84
(a) On 4 July 1990, the Group, Mercian Kabushiki Kaisha and Main Life Co., Ltd. jointly established
Main Luck Pharmaceutical, 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. The Group
owns 33.33% of voting rights. The voting right of the resolutions of the board of directors is one
person and one vote. Except for the amendment and supplement of the articles of association, the
suspension and dissolution of the enterprise, the increase, transfer or adjustment of the registered
capital of the enterprise, the asset mortgage of the enterprise, the merger and division of the
enterprise with other economic organizations and the change of organizational form, other
resolutions of the board of directors must be adopted by more than two-thirds of the directors or
more than half of the directors. Therefore, the Group had significant influence over Main Luck
Pharmaceutical, and 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 their share percentages being 26.00%,
26.00% and 48.00%. According to the articles of association, the board of directors of Shanghai
Beiyi consisted of five directors, of which two were appointed by the Group. The Group owns
40.00% of voting rights. The voting right of resolutions of the board of directors is one vote for one
person, and all resolutions of the board of directors are passed by more than half of all directors.
Therefore, the Group had significant influence over Shanghai Beiyi, and was considered as an
associate of the Group.
230
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
9. Long-term equity investments (Continued)
(c) On 25 November 2003, the Group jointly established Shanghai Liyi with Shanghai Pudong District
Central Hospital and Shanghai Liyi Technology Co., Ltd., with the share percentages being 35.00%,
35.00% and 30.00%, 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. The voting right of resolutions of the board of directors is one vote for one
person, and all resolutions of the board of directors are passed by more than half of all directors.
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 30.00% shares in 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. The voting right
of resolutions of the board of directors is one vote for one person, and all resolutions of the board
of directors are passed by more than half of all directors. The resolution on the change of senior
managers made at the meeting of the board of directors shall be unanimously adopted by all
directors. Therefore, the Group has significant influence over Shanghai Renbei, and thus, it is
considered as an associate of the Group.
(e) On June 16, 1999, the Group acquired 45.00% shares of Dongyuan Congyi. According to the
articles of association, the board of directors of Dongyuan consensus is composed of five directors,
two of whom are appointed by the group, accounting for 40.00% of the voting rights. The voting
right of resolutions of the board of directors is one vote for one person, and all resolutions of the
board of directors are passed by more than half of all directors. Therefore, the group has a
significant impact on Dongyuan consensus, which is an associate of the group. 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 29.00%, 51.00% and 20.00%, 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 20.00% of voting rights. The voting right of
resolutions of the board of directors is one vote for one person, and all resolutions of the board of
directors are passed by more than half of all directors. Therefore, the Group has significant
influence over Guangdong Jienuo, and thus, it is considered as an associate of the Group. On 25
July 2020, 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 29.00%, 51.00% and 20.00% according to the shareholding ratios
respectively, and the total amount of the increased capital was RMB6 million.
231
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
9. 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 10.00%, 79.90%, 10.00%
and 0.10%, respectively. The registered capital of Guangdong Jianhui was RMB20,000,000. On 22
March 2020, the Group completed the investment of RMB2,000,000.00. 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 20.00% of voting rights. The voting right of
resolutions of the board of directors is one vote for one person. Except for some special matters,
other resolutions of the board of directors are approved by more than two-thirds of all directors.
Therefore, the Group has significant influence over Guangdong Jianhui, and thus, it is considered
as an associate of the Group. On 30 March 2021, the Group increased the capital of Guangdong
Jianhui by RMB6 million according to the shareholding ratio.
(h) The Group disposed of its 67.00% equity interest in Zhijun Suzhou in April 2016. After the disposal,
the Group held a 33.00% equity interest of Zhijun Suzhou. According to the Articles of Association,
the board of directors in Zhijun Suzhou was composed of five directors, one of whom was
appointed by the Group, accounting for 20.00% of voting rights. The voting right of resolutions of
the board of directors is one vote for one person, and all resolutions of the board of directors are
passed by more than half of all directors. As a result, the Group has significant influence over Zhijun
Suzhou, and thus, it is considered as an associate of the Group. In 2020, 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 51.00% equity interest in 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 51.00% equity
interest of each of the three pharmaceutical companies, and the Group holds a 49.00% equity
interest in each of the three pharmaceutical companies. The three pharmaceutical companies have
set up a board of directors with a total of five members, of which the Group appoints two directors.
The voting on the resolutions of the board of directors is one person, one vote, and the proportion
of voting rights is 40.00%. Except for some special matters, all resolutions of the board of directors
have been adopted by more than half of all directors. 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, the Group held a 16.28% equity interest of Shyndec
Pharma as at 31 December 2020. 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 has one vote on the board, taking 11.11% of the voting
rights. Except for special resolutions adopted by half of the board of directors. The Group has
significant influence over Shyndec Pharma. The above three pharmaceutical companies and
Shyndec Pharma are considered as associates of the Group.
232
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
9. Long-term equity investments (Continued)
(j) On 9 August 2021, the Group jointly established Jialong Hainan with Hainan Yushan Changxing
Health Management Co., Ltd., with the share percentages being 25.00% and 75.00%, respectively.
According to the Articles of Association, the board of directors of Jialong Hainan 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 Jialong Hainan, and thus, it is considered as an
associate of the Group.
(k) On May 2018, the Group and Ningbo Meishan Bonded Port Area Qiling Equity Investment Center
LP jointly established Shanghai Dingqun, owning 2.53% and 97.47% of shareholdings. 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 has one vote on the board, and
resolutions of the board are to be passed by a simple majority of votes. 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 100.00% 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 2021, 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.
233
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
11. Other equity investments
2021
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. 18,379,638.22 30,379,638.22 - - Non-trading equity instrument
Sinopharm Hubei Guoda Pharmacy Co., Ltd. 17,799,104.17 18,799,104.17 - 2,280,159.50 Non-trading equity instrument
Shanghai Guoda Shuguang Drugstore Co.,
Ltd.(a) 8,048,510.22 8,319,270.22 50,000.00
Shanghai Guoren Pharmacy Co., Ltd. 4,620,895.53 4,720,895.53 - 457,716.39 Non-trading equity instrument
Hunan Zhongbai Pharmaceutical Investment
Co., Ltd. (45,595.15) 269,404.85 - - Non-trading equity instrument
48,802,552.99 62,488,312.99 - 2,787,875.89
234
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
11. Other equity instrument investment (Continued)
2020
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. 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. (a) 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
Co., Ltd. 101,987.82 416,987.82 - - Non-trading equity instrument
85,802,580.28 99,488,340.28 - 640,538.07
(a) Shanghai Guoda Shuguang Pharmacy Co., Ltd. was renamed Shanghai Chongde pharmacy Co., Ltd. on August 26, 2021.
235
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
12. Other non-current financial assets
31 December 2021 31 December 2020
Financial assets at fair value through profit or loss 135,974,908.51 120,972,350.24
As at 31 December 2021, the balance of other non-current financial assets was the fair values of
the shares of phase I and phase II of Sinopharm CICC medical industry fund (“Industry Fund”) that
the Group had subscribed.
At the 21st Meeting of the 7th board of directors which held on 6 January 2017, the Group
deliberated and passed the proposal on investment subscription of the Industry Fund (Phase I) and
related party transaction of the Group. As a limited partner of Industry Fund (Phase I), the Group
intends to invest and subscribe for the share of Industry Fund (Phase I) amounting to RMB200
million, which shall be paid in 3 instalments. The Industrial Fund (phase I) has obtained relevant
approval in 2018 and started to operate. As at 31 December 2020, the Group has made payments
of RMB140 million. The Group received the withdrawal fund of this project’s principal of
RMB19,027,649.76 on June 2020 and received RMB2,997,441.73 on January 2021 from Ningbo
Meishan Bonded Port Area Qirui Equity Investment Center LP.
At the 1st Meeting of the 9th board of directors which held on 16 July 2021, the Group deliberated
and passed the proposal on investment subscription of the Industry Fund (Phase II). As a limited
partner of Industry Fund (Phase II), the Group intends to invest and subscribe for the share of
Industry Fund (Phase II) amounted to RMB60 million, which shall be paid in 3 instalments.
Gongqingcheng Qixin Equity Investment Partnership (Limited Partnership) (“Gongqingcheng Qixin”)
is the entity of the Industry Fund. The Group has made first payment RMB18 millions in August
2021. As at 31 December 2021, the Group has made payments of RMB18 million. The Industrial
Fund (Phase II) has obtained relevant approval in 2021 and started to operate.
Since the cash flows obtained by the Group from the investment of the Industry Fund include 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 Group 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.
236
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
13. Investment properties
Subsequent measurement under the cost model:
2021
Buildings and constructions Land use rights Total
Original cost
Opening balance 225,645,845.78 20,988,818.44 246,634,664.22
Transfer from fixed assets 1,137,337.42 - 1,137,337.42
Transfer to intangible assets - (25,090.42) (25,090.42)
Transfer to fixed assets (20,570,972.44) - (20,570,972.44)
Closing balance 206,212,210.76 20,963,728.02 227,175,938.78
Accumulated
depreciation and
amortisation
Opening balance (109,976,379.20) (7,913,905.08) (117,890,284.28)
Provision (6,189,884.57) (241,318.81) (6,431,203.38)
Transfer from fixed assets (839,607.50) - (839,607.50)
Transfer to intangible assets - 3,512.49 3,512.49
Transfer to fixed assets 13,263,141.12 - 13,263,141.12
Closing balance (103,742,730.15) (8,151,711.40) (111,894,441.55)
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 101,169,480.61 12,812,016.62 113,981,497.23
At beginning of year 114,369,466.58 13,074,913.36 127,444,379.94
237
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
13. Investment properties (Continued)
Subsequent measurement under the cost model (Continued)
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 disburse (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 disburse 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
238
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
13. Investment properties (Continued)
During 2021, depreciation and amortisation of investment properties were RMB6,431,203.38 (2020:
RMB6,014,495.80).
During 2021, properties with a carrying amount of RMB297,729.92 (original value:
RMB1,137,337.42, accumulated depreciation: RMB839,607.50) were leased out to a third party in
the form of operating leases. On the date of changing the use of properties, the fixed assets were
transferred into investment properties.
During 2021, properties with a carrying amount of RMB7,307,831.32 (original value:
RMB20,570,972.44, accumulated depreciation: RMB13,263,141.12) were transferred to an owner-
occupied property. On the date of changing the use of properties, the properties were reclassified
as fixed assets.
As at 31 December 2021, the Group had no investment properties for which certificates of title
have not been obtained.
239
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets
31 December 2021 31 December 2020
Fixed assets 868,626,258.43 854,191,083.27
Disposal of fixed assets - -
868,626,258.43 854,191,083.27
2021
Buildings Machinery and Electronic equipmen
Motor vehicles Office equipment Total
and constructions equipment t
Original cost
Opening 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
Purchase 1,696,893.60 64,861,380.71 14,649,138.22 36,791,424.25 44,599,211.90 162,598,048.68
Transfer from construction in progress 336,010.23 5,718,395.39 - 3,170,559.22 580,888.56 9,805,853.40
Transfer from investment properties 20,570,972.44 - - - - 20,570,972.44
Business combination not involving enterprises under common control - 175,767.00 1,378,743.00 1,828,296.82 2,371,967.27 5,754,774.09
Transfer to investment properties (1,137,337.42) - - - - (1,137,337.42)
Disposal or retirement (244,761.96) (4,339,706.52) (10,380,183.71) (12,284,466.88) (10,846,861.86) (38,095,980.93)
Closing balance 725,861,173.32 371,866,499.22 102,399,414.98 395,148,026.41 157,774,189.87 1,753,049,303.80
240
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
2021
Buildings Machinery and
Motor vehicles Office equipment Electronic equipment Total
and constructions equipment
Accumulated depreciation
Opening 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 (27,764,804.44) (57,298,305.05) (9,207,720.92) (33,305,733.71) (35,110,266.23) (162,686,830.35)
Transfer from investment properties (13,263,141.12) - - - - (13,263,141.12)
Transfer to investment properties 839,607.50 - - - - 839,607.50
Disposal or retirement 33,914.64 2,072,884.48 9,331,535.41 9,279,653.74 9,331,220.60 30,049,208.87
Closing balance (278,578,414.47) (203,467,575.81) (58,211,456.82) (240,594,219.57) (103,571,378.70) (884,423,045.37)
Provision for impairment
Opening balance - - - - - -
Closing balance - - - - - -
Carrying amount
At end of year 447,282,758.85 168,398,923.41 44,187,958.16 154,553,806.84 54,202,811.17 868,626,258.43
At beginning 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
241
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
2020
Buildings Machinery and
Motor vehicles Office equipment Electronic equipment Total
and constructions equipment
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
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)
242
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
2020 (Continued)
Buildings Machinery and
Motor vehicles Office equipment Electronic equipment Total
and constructions equipment
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
243
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
244
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
14. Fixed assets (Continued)
As at 31 December 2021, the fixed assets without certificates of ownership are presented as
follows:
Book value Reason for not accomplishing certification of ownership
As at 31 December 2021, the Group has not yet accpmplished
the certification of title for No.13 Jingxing North Street, Tiexi
District, Shenyang. The State-owned Assets Supervision and
Administration Commission of Tiexi District, Shenyang, which was
the transfer party, was still processing the case and had provided
Buildings and constructions 24,765,862.39 a relevant notification.
As at 31 December 2021, the Group has not yet obtained the
certification of title for No.53 Nanshi Zhong Road, Tiexi District,
Shenyang. Tthe State-owned Assets Supervision and
Administration Commission of Tiexi District, Shenyang, which was
the transfer party, was still processing the case and had provided
Buildings and constructions 38,854,943.08 a relevant notification.
As at 31 December 2021, the Group failed to apply the property
right certification of the title for No.31 Yihe Road, Kaiyuan since
the construction area is larger than the approved area. However,
Kaiyuan City Planning Bureau has issued a certificate of
Buildings and constructions 486,956.52 acceptance of construction project completion planning.
As at 31 December 2021, 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 2021 and 31 December 2020, no fixed assets were temporarily idle.
As at 31 December 2021 and 31 December 2020, no fixed assets were rent out for operating lease.
245
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
15. Construction in progress
31 December 2021 31 December 2020
Construction in progress 49,849,506.70 46,631,190.23
31 December 2021 31 December 2020
Carrying balance Impairment Carrying amount Carrying balance Impairment Carrying amount
Software project 24,794,281.62 - 24,794,281.62 19,443,779.83 - 19,443,779.83
Supply chain extension project 12,446,732.50 - 12,446,732.50 12,248,729.81 - 12,248,729.81
Warehouse improvement project 3,182,704.49 - 3,182,704.49 2,357,739.84 - 2,357,739.84
New office building project - - - 2,654,403.71 - 2,654,403.71
Other projects 9,425,788.09 - 9,425,788.09 9,926,537.04 - 9,926,537.04
49,849,506.70 - 49,849,506.70 46,631,190.23 - 46,631,190.23
246
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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 2021 are presented as follows:
Proportion
of
Source of
Decrease At end of year investment
funds
At beginning of the to budget
Project name Increase
year (%)
Transferred to fixed Transferred to Transferred to long- Other decrease
assets intangible assets term prepaid
expense
Self-raised
Software project 19,443,779.83 24,794,281.62 - (19,443,779.83) - - 24,794,281.62 funds 42.00%
Self-raised
Supply chain extension project 12,248,729.81 9,667,845.86 (9,469,843.17) - - - 12,446,732.50 funds 48.61%
Self-raised
funds/
Specialized
Warehouse improvement project 2,357,739.84 30,023,707.75 (336,010.23) - (28,862,732.87) - 3,182,704.49 borrowings 95.76%
Self-raised
New office building project 2,654,403.71 - - - (2,654,403.71) - - funds 100.00%
Self-raised
Other construction projects 9,926,537.04 1,120,773.41 - - (1,621,522.36) - 9,425,788.09 funds 5.50%
46,631,190.23 65,606,608.64 (9,805,853.40) (19,443,779.83) (33,138,658.94) - 49,849,506.70
247
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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 2021 are presented as follows: (Continued)
2021
Accumulated
amount of
Project borrowings Including: borrowings
Project name Project budget progress(%) capitalised capitalised in the current year Capitalization rate (%)
Software project 105,427,000.00 42.00% - - -
Supply chain extension project 56,041,053.09 48.61% - - -
Warehouse improvement project 33,824,861.55 95.76% 236,775.17 236,775.17 -
New office building project 3,754,800.69 100.00% - - -
Other construction projects 207,470,727.73 5.50% - - -
236,775.17 236,775.17
248
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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
Increase Decrease At end of year investment to
At beginning of the funds
Project name budget (%)
year
Transferred to fixed Transferred to intangible Transferred to long- Other decrease
assets assets term prepaid expense
Self-raised
Software project 13,197,683.52 19,443,779.83 - (13,197,683.52) - - 19,443,779.83 funds 100.00%
Supply chain extension Self-raised
project 8,081,340.80 6,452,163.18 (2,284,774.17) - - - 12,248,729.81 funds 57.29%
New office building Self-raised
project 110,090.53 2,685,041.41 - - (140,728.23) - 2,654,403.71 funds 66.53%
Warehouse Self-raised
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%
Other construction Self-raised
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
249
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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
Accumulated
amount of
Project borrowings Including: borrowings
Project name Project budget progress(%) capitalised capitalised in the current year Capitalization rate (%)
Supply chain extension project 29,065,907.09 57.29% - - -
Software project 19,443,779.83 100.00% - - -
Warehouse improvement project 6,910,764.45 93.29% - - -
New office building project 4,080,919.77 66.53% - - -
Other construction projects 208,542,337.64 5.97% - - -
- - -
250
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets
2021
Buildings Machinery, transport and office
and constructions equipment Others Total
Cost
Opening balance 3,642,726,568.57 6,617,052.55 2,418,809.35 3,651,762,430.47
Increase 1,395,603,990.08 1,068,121.83 - 1,396,672,111.91
Business combinations involving enterprises not under
common control 41,047,873.29 - - 41,047,873.29
Disposal (782,705,015.55) (2,757,280.62) - (785,462,296.17)
Closing balance 4,296,673,416.39 4,927,893.76 2,418,809.35 4,304,020,119.50
Accumulated amortisation
Opening balance (1,289,526,014.83) (5,092,290.96) (191,731.69) (1,294,810,037.48)
Accrual (1,033,746,635.39) (1,015,033.05) (95,734.70) (1,034,857,403.14)
Disposal 598,615,919.44 2,271,741.68 - 600,887,661.12
Closing balance (1,724,656,730.78) (3,835,582.33) (287,466.39) (1,728,779,779.50)
251
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets (Continued)
2021 (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 2,572,016,685.61 1,092,311.43 2,131,342.96 2,575,240,340.00
The beginning of year 2,353,200,553.74 1,524,761.59 2,227,077.66 2,356,952,392.99
252
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
16. Right-of-use assets (Continued)
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 combination not involving enterprises 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)
253
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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
254
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets
31 December 2021 31 December 2020
Intangible assets 669,926,562.82 734,345,179.40
Trademark and Favourable Distribution
2021 Land use rights Software brand use rights leases network Franchise Total
Original cost
Opening 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
Purchase - 14,559,921.40 - - - - 14,559,921.40
Business combination not involving enterprises under common control - 221,415.51 40,440,000.00 - - - 40,661,415.51
Transfer from construction in progress - 19,443,779.83 - - - - 19,443,779.83
Transfer from investment properties 25,090.42 - - - - - 25,090.42
Disposal or discard - (1,207,082.81) - - - - (1,207,082.81)
Closing balance 88,719,468.18 231,316,264.13 322,476,925.12 127,486,000.00 283,573,678.24 710,000.00 1,054,282,335.67
Accumulated amortisation
Opening 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)
Provision (1,813,760.30) (25,870,279.71) (13,459,390.62) (7,085,955.88) (15,975,813.30) - (64,205,199.81)
Transfer from investment properties (3,512.49) - - - - - (3,512.49)
Disposal or discard - 306,971.37 - - - - 306,971.37
Closing balance (32,482,133.76) (136,724,139.35) (18,520,174.43) (44,964,482.67) (76,954,842.64) (710,000.00) (310,355,772.85)
255
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets (Continued)
Trademark and
2021 (Continued) Land use rights Software brand use rights Favourable leases Distribution network Franchise Total
Provision for impairment
Opening balance - - - - - - -
Provision - - (43,000,000.00) - (31,000,000.00) - (74,000,000.00)
Closing balance - - (43,000,000.00) - (31,000,000.00) - (74,000,000.00)
Carrying amount
At end of the year 56,237,334.42 94,592,124.78 260,956,750.69 82,521,517.33 175,618,835.60 - 669,926,562.82
At beginning 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
256
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets (Continued)
Trademarks and
brands use Favourable Distribution
2020 Land use rights Software 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 or discard - (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 or discard - 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)
257
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
V Notes to the consolidated financial statements (Continued)
17. Intangible assets (Continued)
Trademarks
and brands use Favourable Distribution
2020 (Continued) Land use rights Software rights leases 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
As at 31 December 2021, intangible assets formed through internal research in the year-end book value of intangible assets was 9.10% (31 December 2020:
7.32%).
As at 31 December 2021 and 31 December 2020, there were no intangible assets whose certificates of title have not been obtained..
According to the results of the intangible asset impairment testing, the Group's provision of intangible asset impairment loss of RMB74,000,000.00 for the year
was reviewed and approved by the Directors of the Company at its meeting held on March 8, 2022.
258
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
259
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill
Increase during the year Decrease during the year Closing
2021 Opening balance Business combinations not under balance
common 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.
(“Chain Store Shanghai”) 5,028,638.00 - - 5,028,638.00
Sinopharm Holding Guoda Yangzhou
Dadesheng Pharmacy Chain Store
Co., Ltd.
(“Yangzhou Dadesheng”) 7,979,000.00 - - 7,979,000.00
260
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
Increase during the years Decrease during the year Closing
2021 (Continued) Opening balance Business combinations not under balance
common control
Pharmaceutical retail (Continued)
Zhejiang Guoda Pharmacy Co., Ltd.
(“Guoda Zhejiang”) 3,045,183.85 - - 3,045,183.85
Sinopharm Holding Guoda Nanjing
Pharmacy Chain Store Co., Ltd.
(“Guoda Nanjing”) 11,598,341.12 - - 11,598,341.12
Fujian Guoda Pharmacy Chain Store
Co., Ltd. (“Guoda Fujian”) 1,567,250.76 - - 1,567,250.76
Sinopharm Holding Guoda Shandong
Pharmacy Chain Store Co., Ltd.
(“Guoda Shandong”) 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.
(“Guoda Liyang”) 107,275,095.74 - - 107,275,095.74
Sinopharm Holding Hunan Guoda
Minshengtang Pharmacy Chain Co.,
Ltd. (“Guoda Hunan”) 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.
(“Guoda Henan”) 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.
(“Guoda Jiangmen”) 77,350,000.00 - - 77,350,000.00
Sinopharm Holding Guoda Shanxi
Yiyuan Pharmacy Chain Store Co.,
Ltd. (“Shanxi Yiyuan”) 9,080,100.00 - - 9,080,100.00
Shenzhen Guanganli Pharmacy Chain
Store Co., Ltd. store acquisition
(“Shenzhen Guanganli”) 13,420,000.00 - - 13,420,000.00
Beijing Golden Elephant Pharmacy
Medicine Chain Company Limited
(“Beijing Golden Elephant”) 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
Sinopharm Nantong Puji pharmacy
chain Co., Ltd. (“Nantong Puji”)
stores’ acquisition - 11,498,100.00 - 11,498,100.00
261
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
Increase during the year Decrease during the year Closing
2021 (Continued) Opening balance Business combinations not under balance
common control
Pharmaceutical retail (Continued)
Shanxi Huimin Kangwei pharmacy
chain Co., Ltd. (“Huimin Kangwei”)
stores’ acquisition - 20,970,000.00 - 20,970,000.00
Disheng Pharmacy Chain - 158,492,204.21 - 158,492,204.21
2,772,375,281.11 190,960,304.21 - 2,963,335,585.32
Increase during the year Decrease during the year Closing
2020 Opening balance Business combinations not under balance
common 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
Chain Store Shanghai 5,028,638.00 - - 5,028,638.00
Yangzhou Dadesheng 7,979,000.00 - - 7,979,000.00
Guoda Zhejiang 3,045,183.85 - - 3,045,183.85
Guoda Nanjing 11,598,341.12 - - 11,598,341.12
Guoda Fujian 1,567,250.76 - - 1,567,250.76
Guoda Shandong 29,110,409.46 - - 29,110,409.46
Guoda Shenyang 41,047,958.08 - - 41,047,958.08
Guoda Liyang 107,275,095.74 - - 107,275,095.74
Guoda Hunan 41,165,574.64 - - 41,165,574.64
Guoda Quanzhou 41,298,622.59 - - 41,298,622.59
Guoda Henan 22,666,179.77 - - 22,666,179.77
Guoda Inner Mongolia 70,485,777.00 - - 70,485,777.00
Guoda Jiangmen 77,350,000.00 - - 77,350,000.00
Shanxi Yiyuan 9,080,100.00 - - 9,080,100.00
Shenzhen Guanganli stores’
acquisition 13,420,000.00 - - 13,420,000.00
Beijing Golden Elephant 64,140,124.36 - - 64,140,124.36
262
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
Increase during the year Decrease during the year
2020 (Continued) Opening balance Business combinations not under Closing balance
common control
Pharmaceutical retail (Continued)
Guoda Taishan 26,826,120.55 - - 26,826,120.55
Taiyuan Tongxinli 2,818,647.85 - - 2,818,647.85
Acquisition of store of Chaoyang
Yongxingtang 25,973,399.17 - - 25,973,399.17
Acquisition of store of Inner Mongolia
Tongren 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
Shanghai Dingqun - 520,836,246.17 - 520,836,246.17
CDFY - 1,182,443,676.11 - 1,182,443,676.11
Acquisition of store of Liaoning
Xianzhen - 34,037,431.66 - 34,037,431.66
1,035,057,927.17 1,737,317,353.94 - 2,772,375,281.11
Changes in provision for impairment of goodwill are presented as follows:
2021 Opening balance Increase Decrease Closing balance
Provision Disposal
Pharmaceutical retail
Guoda Quanzhou 25,000,000.00 - - 25,000,000.00
Jilin Tianhe - 162,690,000.00 - 162,690,000.00
25,000,000.00 162,690,000.00 - 187,690,000.00
2020 Opening balance Increase Decrease Closing balance
Provision Disposal
Pharmaceutical retail
Guoda Quanzhou 25,000,000.00 - - 25,000,000.00
Guoda Drugstore, the Company’s subsidiary, had acquired 70% equity of Yunnan Guoda Disheng
Medicine and Disheng Pharmacy Chain in March 2021, which saved rise to goodwill amounting to
RMB158,492,204.21. Refer to Note VI (1.1) for more details.
Yangzhou Dadesheng, the Company’s subsidiary, had acquired 15 stores of Nantong Puji in
March 2021, which saved rise to goodwill amounting to RMB11,498,100.00. Refer to Note VI (1.2)
for more details.
Shanxi Wanmin, the Company’s subsidiary, had acquired 32 stores of Huimin Kangwei in February
2021, which saved rise to goodwill amounting to RMB20,970,000.00. Refer to Note VI (1.3) for
more details.
According to the results of the goodwill impairment test, the proposal of the Group to record a
goodwill impairment loss of RMB162,690,000.00 for the year was reviewed and approved by the
board meeting of the Company held on 8 March 2022.
263
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
The goodwill obtained from business combination has been allocated to the operating asset groups
of the principle operations in relevant subsidiaries for goodwill impairment test. These asset groups
are consistent with the asset groups recognized on the purchase date and in the goodwill
impairment test in previous years.
The recoverable amount is determined according to the present value of the expected future cash
flow of the operating asset groups of the principle operations of each subsidiary with goodwill.
Management estimates future cash flows based on a detailed five-year forecast period and
subsequent forecast periods. The projected future cash flows for the detailed forecast period are
determined based on the business plan made by management. The estimated future cash flow for
the subsequent forecast period is determined by the cash flow of the last year of the detailed
forecast period, the Group's business plan, development trends of the industry and other factors.
The recoverable amount of asset groups and asset groups combination is calculated by the five-
year budget approved by the management, using the cash flow forecasting method. Cash flow
beyond the five-year period is extrapolated refer to the inflation rate.
The key assumptions to determine the cash flow forecast when the Group conducts goodwill
impairment test are as follows:
(1) It is assumed that the entity continues to operate, and there is no major change from the
current situation in key aspects such as business scope, sales model and channels,
management and other factors that affect production and operation;
(2) It is assumed that the socio-economic environment where the entity is located will not undergo
major changes, and that the relevant laws and regulations of the region where it is located has
no major changes from the present;
(3) It is assumed that the business scope, business mode, and management model of the entity
are continuously improved and perfected based on maintaining consistency. The entity can
adjust and innovate in a timely manner with the development of the economy;
(4) It is assumed that interest rates and tax rates will have no significant changes within the
specified normal range.
Key assumptions were used to calculate the estimated present values of future cash flow of the
asset groups, pharmaceutical distribution and pharmaceutical retail on 31 December 2021. 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 2.49%-17.00% -2.25%-14.03%
Sustainable growth rate 3.00% 3.00%
Gross margin 3.34%-6.20% 12.36%-52.00%
Discount rate 12.40%-15.00% 12.58%-15.00%
264
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
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.
The main operating entity of Shanghai Dingqun is Sinopharm Holding Tianhe Jilin Pharmaceutical
Co., Ltd. ("Jilin Tianhe"), which is mainly engaged in pharmaceutical wholesale and retail business.
The goodwill formed by the Group's acquisition of Shanghai Dingqun was allocated to Jilin Tianhe
in 2021, which was consistent with the asset group determined during the impairment test in 2020.
Jilin Tianhe is mainly engaged in direct sales of medical institutions, commercial pharmaceutical
distribution, retail chain, logistics and distribution, etc. Its business is generally composed of
wholesale and retail sectors. In 2021, the performance dropped significantly due to the
superimposed effects of multiple factors such as the Covid-19 and industry policies.
Pharmaceutical wholesale: In 2021, sales fell due to the impact of the Covid-19, 4+7 centralized
purchasing, the general reduction of hospital drug prices caused by the implementation of new
standards in Jilin Province, the company's reduction in inventory turnover, and the amount of
commodity cooperation with low gross profit contribution, etc.In 2021, the epidemic situation in Jilin
Province continued to recur, the number of patients are still limited, the hospital's funds were under
great pressure, and payment collection slowed down; Chain customers are affected by the
epidemic since the sales of drugs using to cure fever and cough, anti-virus and antibiotics were
under control, resulting in a decline in its turnover, and continued pressure on capital turnover,
which suppressed the payment of goods from distributors. In this way, the receivables turnover
days of Jilin Tianhe’s chain customers extended, and Jilin Tianhe’s working capital accounted for a
relatively high proportion of revenue.
Retail sector: In 2021, the sales of drugs using to cure fever and cough, anti-virus and antibiotics
were be removed from the shelves due to controlled sales, resulting in a decline in sales.
Meanwhile, customers' consumption habits have changed due to the impact of the epidemic, that
online drug purchases have increased. Therefore, the company's sales structure has changed. In
2021, the proportion of B2C business sales increased, expenses increased significantly, and profit
margins decreased.
The recoverable amount of the asset groups in which Shanghai Dingqun is included was calculated
based on the five-year budget approved by the company's management, using the cash flow
forecasting method, and the cash flow beyond the five-year period is calculated refer to the inflation
rate. The key assumptions made by the Group when conducting the goodwill impairment test and
determining the cash flow forecast are as follows:
Key assumptions Prediction index
Average revenue growth rate in the budget period 11.91%
Sustainable growth rate 3.00%
Average net interest rate in the budget period 3.12%
Discount rate 12.58%
265
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
18. Goodwill (Continued)
After a prudent assessment of the recoverable value of Shanghai Dingqun's relevant asset groups,
the Group made a provision for impairment of goodwill of RMB162,690,000.00 for the goodwill
formed by the acquisition of Shanghai Dingqun during the reporting period.
19. Long-term prepaid expenses
2021 Opening balance Increase Amortisation Other decrease Closing balance
Fixed asset improvement
expenditure of operating
leases 336,895,157.13 244,798,669.54 (128,242,371.51) (5,536,204.71) 447,915,250.45
Acquisition expenditure to
obtain the right to operate 95,802,321.95 94,688,249.44 (24,476,725.85) - 166,013,845.54
Others 25,007,797.01 5,099,952.06 (10,061,403.30) - 20,046,345.77
457,705,276.09 344,586,871.04 (162,780,500.66) (5,536,204.71) 633,975,441.76
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
20. Deferred tax assets/liabilities
Deferred tax assets and deferred tax liabilities before offsetting are as follows:
31 December 2021 31 December 2020
Deductible temporary Deferred tax Deductible temporary Deferred tax assets
differences assets differences
Deferred tax assets
Provision for impairment
of assets 204,535,469.12 49,334,631.28 170,577,875.56 40,697,280.41
Deductible loss 156,999,428.65 39,093,138.09 30,798,485.93 7,699,621.49
Effect of the lease
standard 126,166,577.96 29,685,521.43 93,685,083.09 22,420,179.23
Accrued selling
expenses 109,319,247.99 25,802,416.16 113,445,282.36 26,095,709.73
Payroll payable 59,779,846.77 14,472,633.63 47,280,390.08 11,210,512.95
Membership award
points 56,953,502.72 13,804,027.96 59,179,220.98 14,575,814.61
Others 15,774,146.45 3,884,627.84 21,096,550.78 4,641,850.41
729,528,219.66 176,076,996.39 536,062,888.78 127,340,968.83
266
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
20. Deferred tax assets/liabilities (Continued)
31 December 2021 31 December 2020
Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Deferred tax liabilities
Fair value adjustments for a
business combination not
involving enterprises under
common control 636,489,820.31 159,122,455.09 713,703,864.68 178,425,966.17
Fixed assets less than RMB5
million which are deducted
at once 168,175,688.17 41,874,528.38 126,722,799.31 31,679,099.86
Changes in fair value of
financial assets through
other comprehensive
income 48,802,552.99 12,200,638.25 85,802,580.28 21,450,645.07
Changes in asset valuation
due to change in company
policy 14,911,259.12 3,727,814.78 17,160,546.40 4,290,136.60
Others 25,604,493.16 5,359,719.05 25,205,927.86 5,297,761.98
893,983,813.75 222,285,155.55 968,595,718.53 241,143,609.68
Deferred tax assets and liabilities are presented after being offset against each other are as
follows:
31 December 2021 31 December 2020
The amount of Deferred tax The amount of Deferred tax
offset assets/liabilities -net offset assets/liabilities-net
Deferred tax assets 46,336,826.62 129,740,169.77 35,222,201.02 92,118,767.81
Deferred tax
liabilities 46,336,826.62 175,948,328.93 35,222,201.02 205,921,408.66
The deductible temporary differences and deductible losses that were not recognised as deferred tax assets
are presented as follows:
31 December 2021 31 December 2020
Deductible temporary differences 11,238,147.54 9,435,555.39
Deductible losses (1) 59,698,786.44 61,373,403.25
70,936,933.98 70,808,958.64
(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 RMB59,698,786.44 of the deductible taxable income of those
loss-making subsidiaries.
267
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 31 December 2020
2021 - 2,563,056.08
2022 6,641,123.64 10,708,676.12
2023 8,298,591.45 12,443,327.47
2024 23,628,477.37 25,745,840.71
2025 8,439,382.18 9,912,502.87
2026 12,691,211.80 -
59,698,786.44 61,373,403.25
21. Other non-current assets
31 December 2021 31 December 2020
Specially approved reserving materials 296,857,937.49 260,590,932.98
Guarantees 101,794,142.50 114,186,431.57
Prepayment for projects and equipment 39,854,590.30 24,809,091.30
Contract assets 16,587,685.64 6,999,074.72
Others 4,891,413.31 1,611,992.27
459,985,769.24 408,197,522.84
22. Short-term borrowings
31 December 2021 31 December 2020
Credit borrowings 1,930,467,146.38 1,612,187,020.12
As at 31 December 2021, the weighted average annual interest rate of the above borrowings was
0.44%-4.50% (31 December 2020: 0.56%-5.00%).
As at 31 December 2021 and 31 December 2020, no short-term borrowings of the Group have
matured but were not yet paid.
268
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
23. Notes payable
31 December 2021 31 December 2020
Commercial acceptance bills 73,700,292.69 56,360,197.69
Bank acceptance bills 7,586,516,530.99 7,463,805,077.00
7,660,216,823.68 7,520,165,274.69
At 31 December 2021 and 31 December 2020, 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 2021 31 December 2020
Payment for goods 9,057,718,968.14 7,697,451,142.50
At 31 December 2021, significant accounts payable aged over one year were analysed below:
Amount Reason
Payment for goods 460,528,323.13 Not yet settled
25. Advanced receivables
31 December 2021 31 December 2020
Advanced lease payment 19,289,567.44 12,352,466.64
26. Contract liabilities
31 December 2021 31 December 2020
Contract liabilities 431,303,231.37 368,600,357.14
The ending balance of contract liabilities is the advance payments received by the Group.
Generally, after the Group receives the advance payments by the customers for the sales of goods,
it will perform the performance obligations and recognise the revenue within about 6 months.
269
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable
2021 At beginning of Increase Decrease At end of the
the year year
Short-term employee
benefits 347,602,975.86 3,022,481,722.01 (3,037,343,973.01) 332,740,724.86
Post-employment
benefits (defined
contribution plan) 9,216,204.49 288,373,093.26 (290,325,654.07) 7,263,643.68
Termination benefits 392,866.75 1,130,908.95 (1,331,018.91) 192,756.79
357,212,047.10 3,311,985,724.22 (3,329,000,645.99) 340,197,125.33
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
270
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable (Continued)
Short-term employee benefits:
2021 At beginning of Increase Decrease At end of year
year
Salaries, bonuses, allowances and
grants 330,233,181.61 2,620,557,385.11 (2,640,034,334.79) 310,756,231.93
Staff welfare 1,469,381.07 81,943,225.52 (81,516,526.62) 1,896,079.97
Social security contribution 2,194,328.52 160,467,133.87 (157,992,646.14) 4,668,816.25
Including: Medical insurance 1,531,693.95 149,493,307.88 (146,468,248.07) 4,556,753.76
Work injury insurance 84,285.35 6,209,447.97 (6,201,158.86) 92,574.46
Maternity insurance 578,349.22 4,764,378.02 (5,323,239.21) 19,488.03
Housing funds 1,650,393.19 109,436,368.55 (109,112,123.03) 1,974,638.71
Labour union funds and employee
education funds 11,183,869.70 47,392,989.69 (46,003,723.16) 12,573,136.23
Other short-term benefits 871,821.77 2,684,619.27 (2,684,619.27) 871,821.77
347,602,975.86 3,022,481,722.01 (3,037,343,973.01) 332,740,724.86
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
Labour 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
271
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable (Continued)
Defined contribution plan:
2021 At beginning of Increase Decrease At end of year
year
Basic pension
insurance 3,593,380.27 272,693,481.30 (274,018,523.28) 2,268,338.29
Unemployment
insurance 106,718.12 8,589,082.19 (8,553,196.62) 142,603.69
Contribution to a
pension fund 5,516,106.10 7,090,529.77 (7,753,934.17) 4,852,701.70
9,216,204.49 288,373,093.26 (290,325,654.07) 7,263,643.68
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
272
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
27. Employee benefits payable (Continued)
Termination benefits:
2021 At beginning of Increase Decrease At end of year
year
Retirement
benefits payable
- within 1 year
(Note V (35)) 205,673.65 166,000.00 (232,605.96) 139,067.69
Other termination
benefits (1) 187,193.10 964,908.95 (1,098,412.95) 53,689.10
392,866.75 1,130,908.95 (1,331,018.91) 192,756.79
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
(1) In 2021, other termination benefits for termination labour relations provided by the Group were
RMB964,908.95 and the unpaid balance at the end of the year was RMB53,689.10 (2020:
Other termination benefits for termination labour relations were RMB862,714.24, and the
unpaid balance at the end of the year was RMB187,193.10).
273
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
28. Tax payable
31 December 2021 31 December 2020
Corporate Income taxes 178,870,986.61 173,016,908.47
Value-added tax 116,033,746.26 102,586,862.95
Stamp duty 9,920,803.28 8,243,076.57
City maintenance and construction
surtax 8,285,798.93 6,993,947.17
Individual income tax 7,421,770.17 6,790,402.61
Educational surcharge 6,128,676.48 5,254,608.43
Water conservancy fund 1,904,421.45 5,586,926.64
Property tax 1,166,484.81 664,697.78
Land use tax 63,985.06 54,028.60
Others 7,367,407.14 7,675,689.94
337,164,080.19 316,867,149.16
29. Other payables
31 December 2021 31 December 2020
Interest payable 31,587,062.03 35,572,620.82
Dividend payable 30,140,616.33 6,389,320.96
Other payables 1,653,019,308.10 1,557,204,939.36
1,714,746,986.46 1,599,166,881.14
Interest payable
31 December 2021 31 December 2020
Factoring interest on accounts
receivable 31,587,062.03 35,572,620.82
Dividend payable
31 December 2021 31 December 2020
Jilin Yihe Investment Consulting Co.,
Ltd 22,635,133.81 -
Shanghai Fosun Pharmaceutical
(Group) Co., Ltd. (“Fosun Pharm”) 4,835,511.58 4,835,511.58
Dividend payable to Zhang
Zhenfang 2,505,800.87 1,389,639.31
Meiluo Pharmaceutical Co., Ltd. 164,170.07 164,170.07
30,140,616.33 6,389,320.96
As at 31 December 2021 and 31 December 2020, the Group had no significant dividend aged more
than one year and not yet paid.
274
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
29. Other payables (Continued)
Other payables
31 December 2021 31 December 2020
Payables for factoring programs 549,837,612.90 576,523,284.81
Deposits 449,660,261.02 472,800,624.92
Accrued expenses 230,547,704.07 213,950,722.34
Equity payable 125,000,000.00 38,702,372.01
Payables for rentals 95,330,986.78 68,417,303.16
Payables for construction in progress
and equipment 53,913,827.67 40,898,589.59
Collection of others 28,674,847.66 19,119,286.19
Payables to individuals 17,809,022.64 25,869,320.67
Temporary loans 9,984,512.61 11,017,981.51
Payables for land transfer payments 7,486,500.00 12,597,500.00
Payables to related parties 596,258.19 5,093,263.36
Others 84,177,774.56 72,214,690.80
1,653,019,308.10 1,557,204,939.36
At 31 December 2021, significant other payables outstanding for over 1 year are as follows:
Amount payable Reason for outstanding
Payables for deposits 18,256,859.55 Payment conditions not met
Temporary loans 9,800,000.00 Payment conditions not met
Payables for land transfer payments 7,486,500.00 Payment conditions not met
35,543,359.55
30. Non-current liabilities due within one year
31 December 2021 31 December 2020
Lease liabilities due within 1 year (Note
V (33)) 848,328,648.14 748,732,059.89
848,328,648.14 748,732,059.89
275
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
31. Other current liabilities
31 December 2021 31 December 2020
VAT collected in advance 27,078,191.86 24,142,106.09
Output VAT to be recognised 418,081.05 644,972.46
Others 12,089,196.74 -
39,585,469.65 24,787,078.55
32. Long-term borrowings
31 December 2021 31 December 2020
Credit loans 40,000,000.00 -
Entrusted loans 31,637,173.89 31,637,173.89
71,637,173.89 31,637,173.89
As at 31 December 2021, the balance of credit loans was RMB40,000,000.00 (31 December 2020:
nil), the weighted average annual interest rate of the entrusted loans was 4.05% (31 December
2020: nil).
As at 31 December 2021, the balance of entrusted loans was RMB31,637,173.89 (31 December
2020: RMB 31,637,173.89). CNPGC entrusted Sinopharm Group Finance Co., Ltd. to provide the
loans. As at 31 December 2021, the weighted average annual interest rate of the entrusted loans
was 3.85% (31 December 2020: 3.85%).
33. Lease liabilities
31 December 2021 31 December 2020
Lease payment 2,400,604,558.67 2,217,275,863.33
Unrecognised financing expenses (176,848,033.25) (165,489,639.54)
Less: Lease liabilities due within 1 year
(Note V (30)) 848,328,648.14 748,732,059.89
1,375,427,877.28 1,303,054,163.90
34. Long-term payables
31 December 2021 31 December 2020
Payables for specific projects 6,938,189.00 6,938,189.00
276
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
34. Long-term payables (Continued)
Payables for specific projects
2021
At beginning of year Increase Decrease At end of year
Medical reserve funds (1) 6,138,189.00 - - 6,138,189.00
Special funds granted by the
government (2) 800,000.00 - - 800,000.00
6,938,189.00 - - 6,938,189.00
2020
At beginning of year Increase Decrease At end of year
Medical reserve funds (1) - 6,138,189.00 - 6,138,189.00
Special funds granted by the
government (2) 800,000.00 - - 800,000.00
800,000.00 6,138,189.00 - 6,938,189.00
(1) The medical reserve funds were allocated by the Liaoning Province Department of Finance to Liaoning Chengda
Fangyuan Pharmaceutical Chain Co., Ltd. (“Liaoning Chengda Pharmacy Chains”), which was incorporated into the
consolidation financial statements in 2020.
(2) The specific payables are research funds allocated by government departments and are accounted for the specific
payable account at the time of allocation.
35. Long-term employee benefits payable
31 December 2021 31 December 2020
Long-term termination benefits 965,000.00 1,049,000.00
Net liabilities of defined benefit plans 237,000.00 270,000.00
1,202,000.00 1,319,000.00
31 December 2021 31 December 2020
Early retirement benefits payable 1,341,067.69 1,524,673.65
Less: Retirement benefits payable
within 1 year (Note V (27)) 139,067.69 205,673.65
1,202,000.00 1,319,000.00
277
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 31 December 2020
Discount rate 3.00% 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:
2021 2020
Included in administrative expenses 2,000.00 17,000.00
Included in finance costs 47,000.00 51,000.00
49,000.00 68,000.00
36. Accrued liabilities
At beginning of year Increase Decrease At ending of year
Pending litigation or
arbitration (1) 68,808,166.79 - (68,808,166.79) -
(1) Pending litigation or arbitration mainly includes: 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 Cdfy Pharm Co., Ltd.(“Liaoning Cdfy
Pharm”) 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 Cdfy Pharm and its parent company, CDFY, to assume the corresponding legal
responsibilities. Chengda Pharmaceutical Chain recognised the accrued liabilities of
RMB68,663,166.79 in accordance with the progress of the case. In 2021, Liaoning Cdfy
Pharm paid all the money to the Bank according to the judgment.
278
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
37. Deferred income
2021 Opening balance Increase Decrease Closing balance
Government grants 89,559,628.65 7,551,767.34 (10,709,176.45) 86,402,219.54
Input tax plus and minus 283,954.72 2,323,372.25 (2,092,494.73) 514,832.24
89,843,583.37 9,875,139.59 (12,801,671.18) 86,917,051.78
2020 Opening balance Increase Decrease Closing balance
Government grants 88,471,539.41 7,736,003.12 (6,647,913.88) 89,559,628.65
Input tax plus and minus 232,733.47 1,654,660.85 (1,603,439.60) 283,954.72
88,704,272.88 9,390,663.97 (8,251,353.48) 89,843,583.37
As at 31 December 2021, deferred income from government grants is as follows:
Government grants program Opening Addition in the Amount Other changes Closing balance Asset-related/
balance year included in other income-related
income in the
year
Resettlement compensation (1) 70,158,624.05 - - (2,698,408.56) 67,460,215.49 Asset-related
Logistics project of Nanning
Economic Development Zone
construction support funds 4,846,565.87 - (186,406.44) - 4,660,159.43 Asset-related
Construction fund of the modern
supply chain system in the
central circulation field in 2018 4,353,019.54 4,650,000.00 (2,242,364.74) - 6,760,654.80 Asset-related
Subsidies for pharmaceutical
supply chain projects - 2,800,000.00 (889,995.63) - 1,910,004.37 Asset-related
Guangzhou logistics
standardisation pilot project 1,722,518.87 - (546,246.84) - 1,176,272.03 Asset-related
Funds for the logistics
information platform project of
the pharmaceutical storage
centre 809,523.99 - (142,857.12) - 666,666.87 Asset-related
Comprehensive experimental
modern service industry
subsidies 900,000.00 - (300,000.00) - 600,000.00 Asset-related
Special funds for industrial
transformation and upgrading
in dualised integration projects 827,658.18 - (434,938.08) - 392,720.10 Asset-related
Asset-related/
Other projects 5,941,718.15 101,767.34 (2,809,211.08) (458,747.96) 2,775,526.45 income-related
89,559,628.65 7,551,767.34 (7,552,019.93) (3,157,156.52) 86,402,219.54
279
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
37. Deferred income (Continued)
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 income-related
in 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 dualised 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 2,519,613.22 5,084,703.12 (1,367,821.15) (294,777.04) 5,941,718.15 income-related
88,471,539.41 7,736,003.12 (3,654,728.28) (2,993,185.60) 89,559,628.65
(1) Due to the implementation of urban planning for old town reconstruction in Nanning, the
operating centre 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 property with a
value of RMB70,250,000.00 was built and delivered, which had been recognised as
investment property.
The compensation relating to the capital expenditure in the reconstruction of the new logistics
centre 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, with amount
approximates of RMB26,930,000.00 was recognised in the income statement in 2012.
280
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
38. Other non-current liabilities
31 December 2021 31 December 2020
Medical reserve funds (1) 560,495,462.17 711,029,182.37
Equity payable 71,400,000.00 -
Product promotion accumulative
points programme (2) 32,479,462.95 29,815,911.17
Others 6,140.53 17,896.05
664,381,065.65 740,862,989.59
(1) The medical reserve funds includes 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. In the future, according to government instructions, purchase designated reserve
pharmaceutical products.
(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
2021 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 367,733,625.00 - - - 367,733,625.00
-B shares, listed 54,884,475.00 - - - 54,884,475.00
Listed shares with
restriction of trading:
-State-owned legal
persons shares 5,505,770.00 - - - 5,505,770.00
-Natural persons
registered within
China shares 3,113.00 - - - 3,113.00
428,126,983.00 - - - 428,126,983.00
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 persons
registered within
China shares 5,114,297.00 - (5,114,297.00) (5,114,297.00) -
-Natural persons
registered within
China shares 3,113.00 - - - 3,113.00
428,126,983.00 - - - 428,126,983.00
281
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
40. Capital surplus
2021 At beginning of the year Increase Decrease At end of the year
Share premium 2,118,174,787.27 - - 2,118,174,787.27
Other capital surplus -
Significant reorganisation 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) (52,403,860.01) - (701,946.29) (53,105,806.30)
Business combination under common
control (2) 9,890,417.88 - - 9,890,417.88
Others 1,120,284,623.39 - - 1,120,284,623.39
4,372,504,053.72 (701,946.29) 4,371,802,107.43
2020 At beginning of the year Increase Decrease At end of the year
Share premium 2,118,174,787.27 - - 2,118,174,787.27
Other capital surplus -
Significant reorganisation 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
(1) A decrease of RMB701,946.29 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 RMB701,946.29.
A decrease of RMB393,875.73 in other changes in equity of the invested entity under the
equity method in 2020, 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 included in capital surplus of RMB393,875.73.
(2) The Company’s subsidiary, Guoda Drugstore, acquired Pudong Medicine, an enterprise under
common control on 2 January, 2020, which formed a business combination under common
control (Note VI (2)). The reporting entity formed after the deemed merger has existed since
the final controller began to control. When preparing and comparing the consolidated financial
statements, the items of the previous financial statements shall be adjusted. At 2020, 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 based on the difference between the book value of identifiable
net assets and the consideration payments at the consolidation date.
282
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 Increase/(decrease) 31 December 2021
Change in the fair value of other
equity investments 38,611,051.04 (16,650,012.28) 21,961,038.76
Other comprehensive income
using the equity method that
may be reclassified to profit
or loss (128,033.32) 41,192.92 (86,840.40)
38,483,017.72 (16,608,819.36) 21,874,198.36
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:
2021
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 (37,000,027.29) 9,250,006.82 (16,650,012.28) (11,100,008.19)
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 41,192.92 - 41,192.92 -
(36,958,834.37) 9,250,006.82 (16,608,819.36) (11,100,008.19)
283
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
41. Other comprehensive income (Continued)
2020
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)
284
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
42. Surplus reserves
31 December 2021 31 December 2020
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 is
not required to continue to appropriate the surplus reserves.
43. Retained earnings
31 December 2021 31 December 2020
Retained earnings at the end of the prior year before
adjustment 8,895,145,106.39 7,755,295,537.08
Adjust: Business combination under common control (1) - (3,029,877.91)
Retained earnings at the end of the prior year after adjustment 8,895,145,106.39 7,752,265,659.17
Add: Net profit attributable to the parent 1,336,427,752.22 1,401,892,593.23
Less: Withdrawal from the surplus reserves - -
Cash dividends payable for ordinary shares (2) 342,501,586.40 256,876,189.80
Others - 2,136,956.21
Retained earnings at end of year 9,889,071,272.21 8,895,145,106.39
(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 RMB0.00 (2020: decreased by RMB3,029,877.91).
(2) Pursuant to the resolution of the General Meeting of shareholders on 28 April 2021, the Company paid
a cash dividend of RMB8.00 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 RMB342,501,586.40.
285
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
44. Operating revenue and cost
2021 2020
Revenue Cost Revenue Cost
Principal operations 67,647,803,370.00 60,117,131,141.65 59,129,559,267.80 52,474,778,734.75
Other operations 710,006,201.99 222,166,910.59 519,895,744.23 116,988,729.62
68,357,809,571.99 60,339,298,052.24 59,649,455,012.03 52,591,767,464.37
Revenue is as follows:
2021 2020
Revenue from contracts with customers 68,263,151,536.38 59,575,293,446.98
Rentals 94,658,035.61 74,161,565.05
68,357,809,571.99 59,649,455,012.03
Disaggregation of revenue from contracts with customers is as follows:
2021 2020
Place of business
China 68,263,151,536.38 59,575,293,446.98
Types of major activities
Pharmaceutical distribution 47,415,894,164.79 41,771,721,959.60
Retail pharmacy 20,546,784,164.42 17,626,007,757.96
Others 300,473,207.17 177,563,729.42
68,263,151,536.38 59,575,293,446.98
Types of major goods
Pharmaceuticals 60,694,809,091.70 54,004,558,520.07
Medical devices and disposables 5,831,199,233.19 4,010,735,060.66
Diagnostic reagents 994,724,313.55 947,638,322.63
Medical equipment 441,945,690.77 434,797,814.20
Others 300,473,207.17 177,563,729.42
68,263,151,536.38 59,575,293,446.98
286
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
Timing of revenue recognition
At a point in time
Sale of goods 67,962,678,329.21 59,397,729,717.56
Over time
Provision of services 123,347,496.99 68,569,069.02
Storage and logistics 177,125,710.18 108,994,660.40
68,263,151,536.38 59,575,293,446.98
Revenue recognised that was included in contract liabilities at the beginning of the year is as follows:
2021 2020
Sale of goods 368,600,357.14 302,650,567.97
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 after the service is completed.
287
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
45. Taxes and surcharges
2021 2020
City maintenance and construction tax 61,522,088.57 59,276,259.36
Stamp duty 46,171,015.32 39,538,983.99
Educational surcharge 44,666,008.44 43,510,012.21
Property tax 9,265,222.92 7,664,420.10
River & embankment maintenance fee 4,588,775.31 1,949,549.82
Land tax 1,653,652.98 1,174,966.86
Vehicle and vessel use tax 186,063.72 194,779.35
Others 1,414,741.01 1,322,475.51
169,467,568.27 154,631,447.20
46. Selling expenses
2021 2020
Employee benefits 2,455,601,404.16 2,043,118,426.77
Depreciation expenses of right-of-use assets 952,094,987.01 835,697,733.77
Rental expenses 247,722,061.87 158,482,491.26
Technical service fee 217,961,408.80 131,325,755.99
Amortisation of long-term deferred expenses 141,330,721.55 115,379,262.15
Depreciation expenses of fixed assets 120,553,856.31 97,651,219.31
Utilities 89,553,600.70 78,849,800.64
Office expense 83,255,087.05 66,308,505.21
Storage expenses 48,647,528.57 36,065,016.61
Promotion and marketing expenses 44,119,240.26 49,558,552.69
Amortisation of intangible assets 38,160,273.97 27,930,125.84
Property management fee 37,012,324.99 31,062,038.32
Entertainment expenses 33,588,865.45 33,444,574.42
Repairing fees 20,378,201.18 20,602,212.23
Market development fee 14,481,534.88 21,647,420.16
Conference expenses 9,568,265.21 16,225,584.87
Travel allowances 8,845,804.34 7,965,661.14
Others 189,987,798.79 171,819,714.37
4,752,862,965.09 3,943,134,095.75
288
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
47. Administrative expenses
2021 2020
Employee benefits 747,801,690.81 699,697,917.02
Office expense 33,742,241.05 35,056,907.24
Rental expenses 31,250,655.07 26,955,390.76
Depreciation expenses of fixed assets 30,152,734.89 30,748,526.91
Amortisation of intangible assets 24,861,994.05 22,075,334.76
Depreciation expenses of right-of-use assets 21,678,755.56 23,903,526.11
Technical service fee 18,400,911.07 30,879,626.54
Entertainment expenses 17,777,998.29 15,641,332.80
Amortisation of long-term deferred expenses 17,034,583.67 16,330,808.19
Agency service fee 13,981,262.75 16,719,272.96
Property management fee 10,905,353.41 6,252,043.20
Travel allowance 9,403,623.64 8,372,052.69
Vehicle management expenses 8,235,227.55 8,036,500.07
Utilities 7,507,638.59 5,303,905.41
Repairing fee 6,473,496.59 5,803,015.00
Others 46,427,434.18 56,402,656.12
1,045,635,601.17 1,008,178,815.78
48. Finance costs
2021 2020
Interest expenses 288,038,760.87 258,189,163.79
Less: Interest income 74,297,769.23 136,455,990.10
Cash discount from purchase 41,885,182.05 41,965,157.97
Exchanges gain/(loss) (414,505.08) 52,538.86
Others 41,041,497.39 40,034,615.27
212,482,801.90 119,855,169.85
289
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
49. Other income
2021 2020
Government subsidies relate to daily life 72,750,642.95 56,187,061.03
VAT reduction for small-scale taxpayers 26,776,183.34 12,478,277.50
VAT additional deduction 2,132,908.71 1,754,349.24
Tax preference for self-employed retired soldiers 916,571.72 861,689.99
Taxation service charge refund 841,756.38 1,082,430.43
Cash 103,418,063.10 72,363,808.19
Government subsidies relate to daily life as below：
Related to asset/
2021 2020 income
Construction fund of the modern supply chain system
in the central circulation field in 2018 2,242,364.74 662,356.25 Related to asset
Transfer from other deferred income 1,177,259.66 1,019,634.01 Related to asset
Subsidies for pharmaceutical supply chain projects 889,995.63 - Related to asset
Guangzhou logistics standardisation pilot project 546,246.84 546,246.84 Related to asset
Industrial transformation and upgrading in dualised
integration project 434,938.08 449,040.48 Related to asset
Comprehensive experimental modern service industry
subsidies 300,000.00 300,000.00 Related to asset
Job stabilisation grants 22,761,628.20 23,907,132.61 Related to income
Government support funding 17,276,483.87 5,693,338.30 Related to income
Tax return 9,474,220.65 6,362,566.77 Related to income
Government grants for medicine reserve expenses 5,048,631.31 3,280,609.72 Related to income
Subsidies related to COVID-19 2,500,298.40 4,860,421.11 Related to income
Enterprise economy awards 2,083,310.00 4,103,804.00 Related to income
Enterprise economic contribution awards 186,000.00 - Related to income
Others 7,829,265.57 5,001,910.94 Related to income
72,750,642.95 56,187,061.03
50. Investment income
2021 2020
Long-term equity investment income under the equity method 333,397,116.38 354,345,705.65
Investment income from non-current financial assets held 3,599,555.61 4,109,881.90
Dividend income from other equity investments held 2,787,875.89 640,538.07
Investment income from the derecognition of financial assets
measured at amortised cost (47,404,044.48) (76,142,835.36)
Others - 998,665.84
292,380,503.40 283,951,956.10
290
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
51. Credit impairment losses
2021 2020
Impairment loss on accounts receivable 43,490,919.28 21,209,110.01
Impairment loss on other receivables 546,533.80 3,286,689.75
Impairment loss on notes receivable (1,479,520.32) 1,479,520.32
Others 232,467.00 -
42,790,399.76 25,975,320.08
52. Impairment losses
2021 2020
Loss from impairment of goodwill 162,690,000.00 -
Loss from impairment of intangible assets 74,000,000.00 -
Loss from write-down of inventories 5,575,725.41 5,079,297.71
Loss from impairment of contract assets 492,584.44 17,799.31
Loss from impairment of other non-current assets 146,556.66 82,188.73
242,904,866.51 5,179,285.75
53. Gain on disposal of assets
2021 2020
Gain on disposal of right-of-use assets 4,181,949.81 6,094,970.49
Gain on disposal of fixed assets 63,422.96 696,992.01
4,245,372.77 6,791,962.50
54. Non-operating income
Included in non-
recurring profit or
2021 2020 losses in 2021
Gain from writing off the unnecessary payments 26,709,015.16 4,342,240.20 26,709,015.16
Government grants irrelevant to daily operations 3,004,848.56 6,037,572.78 3,004,848.56
Others 6,650,857.64 7,281,107.60 6,650,857.64
36,364,721.36 17,660,920.58 36,364,721.36
291
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
54. Non-operating income (Continued)
Government grants are as follows:
Asset-related/
2021 2020 income-related
Resettlement compensation of Guangxi Logistics 2,698,408.56 2,698,408.56 Asset-related
Resettlement compensation of Guoda Fujian 306,440.00 - Asset-related
Resettlement compensation of Guoda Nanjing - 3,339,164.22 Asset-related
3,004,848.56 6,037,572.78
55. Non-operating expenses
Included in non-
recurring profit or
2021 2020 losses in 2021
Donation expenses 3,538,990.50 1,297,427.97 3,538,990.50
Penalty and late payment expenses 3,102,600.19 2,218,668.33 3,102,600.19
Loss on damage in non-current assets needed to be
scrapped 1,549,925.06 1,223,651.40 1,549,925.06
Lawsuit compensation 552,948.50 16,510,153.06 552,948.50
Others 5,178,663.89 3,015,711.08 5,178,663.89
13,923,128.14 24,265,611.84 13,923,128.14
56. Government grants
The government grants, which are offset against expenses as set out below, are presented on a net
basis.
2021 2020
Government grants related to income
Offset against finance costs 25,498.62 2,385,907.71
Offset against administrative expenses 99,796.31 59,398.58
Offset against selling expenses 20,154.10 36,507.26
145,449.03 2,481,813.55
Note: In 2021, the Group received the loan discount funds of RMB139,900.00 from the Finance
Bureau of Zhaoqing in Guangdong province due to the COVID-19 epidemic. The Group offset
the RMB25,498.62 in 2021 against financial expenses. In 2021, the Group received maternity
allowance of RMB119,950.41 from Shenzhen Social Insurance Fund Administration.
According to the Accounting Standards for Enterprises No. 16-Governmental Subsidies, the
Group offset the amount against the administrative expenses and selling expenses.
For details of other government subsidies, please refer to Note V (37 & 49 & 54)
292
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021 2020
Inventories of finished and work-in-progress
goods/cost of inventories 59,957,238,467.93 52,459,887,987.76
Employee benefits 3,305,915,608.14 2,768,505,064.02
Depreciation and amortisation 1,430,961,137.34 1,194,018,733.06
Rental expenses not included in the
measurement of lease liabilities 257,111,215.23 151,957,389.34
Technical service fee 236,362,319.87 162,205,382.53
Transportation expenses 155,907,359.53 109,386,423.64
Office telecom and internet expenses 116,997,328.10 101,365,412.45
Utilities 110,354,127.11 90,047,842.72
Promotion and marketing expenses 58,600,775.14 71,205,972.85
Entertainment expenses 51,366,863.74 49,085,907.22
Storage expenses 48,647,528.57 36,065,016.61
Property management fee 47,917,678.40 37,314,081.52
Travel allowance 28,951,003.17 28,019,639.55
Repairing fee 26,851,697.77 26,405,227.23
Agency service fee 13,981,262.75 16,719,272.96
Conference expenses 9,916,944.83 19,914,839.02
Others 280,715,300.88 220,976,183.42
66,137,796,618.50 57,543,080,375.90
293
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
58. Income tax expenses
2021 2020
Current tax expenses 511,339,714.83 444,118,362.45
Deferred tax expenses (64,129,060.16) (8,178,312.39)
447,210,654.67 435,940,050.06
The reconciliation between income tax expenses and profit before income taxes is as follows:
2021 2020
Profit before income tax expenses 1,974,852,849.54 2,157,236,448.78
Income taxes calculated at applicable tax rates 493,713,212.39 539,309,112.20
Preferential tax rate difference of some subsidiaries (41,720,023.45) (38,815,678.48)
Income not subject to tax (83,349,279.10) (88,586,426.41)
Expenses not deductible for tax 70,430,086.00 17,821,245.15
Deductible temporary difference of unrecognised
deferred income tax assets in the current period 4,866,102.46 5,902,131.10
Utilisation of previously unrecognised tax losses (2,877,206.15) (521,828.35)
Adjustment of income tax expenses of previous years 6,147,762.52 831,494.85
Income tax expenses 447,210,654.67 435,940,050.06
59. Earnings per share
2021 2020
RMB/share RMB/share
Basic earnings per share
Continuing operations 3.12 3.27
Diluted earnings per share
Continuing operations 3.12 3.27
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.
294
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
59. Earnings per share (Continued)
In year 2021, the Company had no potential dilutive ordinary shares and the diluted earnings per
share were the same as the basic earnings per share.
The calculation of basic and diluted earnings per share is as follows:
2021 2020
Earnings
Consolidated net profit attributable to the
shareholders of the parent 1,336,427,752.22 1,401,892,593.23
Continuing operations 1,336,427,752.22 1,401,892,593.23
Net profit attributable to the calculation of
earnings per share 1,336,427,752.22 1,401,892,593.23
Shares
Adjusted weighted average number of ordinary
shares outstanding 428,126,983.00 428,126,983.00
Basic and diluted earnings per share 3.12 3.27
60. Notes to items in the cash flow statement
Other cash receipts relating to operating activities
2021 2020
Rent income 101,595,136.41 74,161,565.05
Interest income 74,261,140.08 136,427,967.70
Government grants except tax return 64,111,067.16 47,708,906.67
Receipts from the emergency medical supplies
reserve 24,257,455.32 784,665,445.45
Others 460,760,957.24 654,419,910.31
724,985,756.21 1,697,383,795.18
Other cash payments relating to operating activities
2021 2020
Rental expenses 257,111,215.23 151,957,389.34
Office expenses 116,997,328.10 101,365,412.45
Advertising expenses 58,600,775.14 71,205,972.85
Entertainment expenses 51,366,863.74 49,085,907.22
Bank charges 37,788,467.52 37,676,127.97
Travel expenses 28,951,003.17 28,019,639.55
Conference expenses 9,916,944.83 19,914,839.02
Others 1,274,530,541.48 1,211,786,095.67
1,835,263,139.21 1,671,011,384.07
295
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
2021 2020
Refund of the expense of “Water supply, power supply,
heating and property management” 54,984.60 1,992,616.05
Allocation of cash pool (a) - 22,000,000.00
Others - 59,058.62
54,984.60 24,051,674.67
(a) The Company’s subsidiary, Guoda Drugstore, acquired Pudong Medicine, an enterprise under common
control in 2020 and recovered the fund in 2020.
Other cash payments relating to investing activities
2021 2020
Payment of long-term deposits - 5,000,000.00
Others 1,305,765.00 2,197.26
1,305,765.00 5,002,197.26
Other cash receipts relating to financing activities
2021 2020
Loans from other related parties received 81,450,000.00 160,700,000.00
Financing restricted monetary funds received 20,430,912.41 141,308,707.63
Loans from Sinopharm Group received - 56,000,000.00
Others - 1,323,768.00
101,880,912.41 359,332,475.63
Other cash payments relating to financing activities
2021 2020
Payment of the principal of lease liabilities 1,092,614,329.84 886,017,712.27
Payment of the factoring payable 65,887,298.53 272,967,183.06
Payment of the loans to other related parties 65,700,000.00 362,303,318.18
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 23,587,000.34 -
1,247,788,628.71 1,865,923,680.60
296
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
2021 2020
Net profit 1,527,642,194.87 1,721,296,398.72
Add: Provision for asset impairment 285,695,266.27 31,154,605.83
Depreciation of fixed assets and investment properties 169,118,033.73 139,721,479.94
Depreciation of right-of-use assets 1,034,857,403.14 867,425,059.82
Amortisation of intangible assets 64,205,199.81 50,760,373.29
Amortisation of long-term prepaid expenses 162,780,500.66 136,111,820.01
Gains on disposal of fixed assets and other long-term assets (2,695,447.71) (5,568,311.10)
Finance expenses 228,462,843.64 211,028,322.66
Investment income (292,380,503.40) (283,951,956.10)
Increase in deferred tax assets (48,454,612.84) (8,261,294.12)
Decrease in deferred tax liabilities (24,924,454.13) (4,050,183.18)
Increase in inventories (1,259,824,920.15) (406,383,320.25)
Increase in operating receivables (2,120,781,530.56) (2,989,963,280.33)
Increase in operating payables 2,135,081,271.31 2,124,730,859.17
Increase in restricted operating cash with restriction (203,600,267.77) (81,303,975.89)
Net cash flows from operating activities 1,655,180,976.87 1,502,746,598.47
Receival of endorsement bank acceptance bills from the
sale of goods and the rendering of services 1,254,088,804.64 1,307,213,655.41
Movement of cash
Cash at the end of year 4,733,512,222.35 5,405,113,257.99
Less: Cash at the beginning of year 5,405,113,257.99 8,426,071,170.16
Net decrease in cash (671,601,035.64) (3,020,957,912.17)
297
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
2021 2020
Price of acquiring subsidiaries and other operating units
296,268,139.12 2,839,268,100.00
Including: Disheng Pharmacy Chain
238,000,000.00 -
32 directly-managed stores of Huimin Kangwei 30,000,000.00 -
15 directly-managed stores of Nantong Puji 14,138,139.12 -
Disheng Medicine 14,130,000.00 -
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
Cash and cash equivalents paid for acquisitions of subsidiaries and
other operating units 138,668,139.12 2,824,445,549.00
Including: Disheng Pharmacy Chain 71,400,000.00 -
32 directly-managed stores of Huimin Kangwei 30,000,000.00 -
15 directly-managed stores of Nantong Puji 14,138,139.12 -
Disheng Medicine 14,130,000.00 -
Guoda Pu’er
9,000,000.00 -
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
298
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (Continued)
2021 2020
Less: Cash and cash equivalents held by subsidiaries and other
operating units at the acquisition date 28,717,501.71 178,407,397.24
Including: Disheng Pharmacy Chain 20,993,798.76 -
Disheng Medicine 7,723,702.95 -
CDFY - 159,681,219.62
Shanghai Dingqun - 18,639,019.00
Yangjiang Medicine - 77,158.62
Golden Elephant Guoxing - 10,000.00
Net cash flow on acquisition of the subsidiaries and other
operating units (a) 109,950,637.41 2,646,038,151.76
(a) The net cash inflow on acquisition of Yangjiang Medicine was RMB59,058.62 in 2020. The group presents
the investment as other cash receipts relating to operating activities.
(3) Cash and cash equivalents
2021 2020
Cash
Included: Cash on hand 4,642,730.62 6,707,125.90
Bank deposits on demand 4,728,869,491.73 5,398,406,132.09
Cash balance at the end of the year 4,733,512,222.35 5,405,113,257.99
299
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
V Notes to the consolidated financial statements (Continued)
62. Assets under restricted ownership or right to use
2021 2020 Note
Cash and cash equivalents 392,646,858.59 593,091,037.88 (1)
Notes receivable that were
endorsed 31,886,681.19 4,095,283.92 (2)
Receivables financing that were
pledged - 2,620,000.00 (3)
424,533,539.78 599,806,321.80
(1) As at 31 December 2021, the Group had deposits of bank acceptance bills, Medical reserve funds,
and other restricted cash of RMB392,646,858.59 (31 December 2020: RMB593,091,037.88) (Note
V (1)).
(2) As at 31 December 2021, the Group had notes receivable of RMB31,886,681.19 (31 December
2020: notes receivable of RMB4,095,283.92), which were endorsed but not have matured (Note V
(2) and (4)).
(3) As at 31 December 2021, the Group had no pledged receivables financing (31 December 2020:
2,620,000.00) (Note V (4)).
300
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VI Changes in the scope of consolidation
1. Business combinations not involving enterprises under common control
1.1 Acquisition of Disheng Medicine and Disheng Pharmaceutical Chain
Guoda Drugstore, a subsidiary of the Group, acquired 70% equity of Disheng Medicine and Disheng
Pharmaceutical Chain, respectively, from Xishuangbanna Disheng Pharmaceutical Co., Ltd. The payment
made to Disheng Medicine and Disheng Pharmaceutical Chain were RMB 14,130,000.00 and
RMB238,000,000.00, respectively. The acquisition date was 15 March 2021.
The fair values and carrying amounts of identifiable assets and liabilities of Disheng Medicine on the
acquisition date are presented as follows:
15 March 2021 15 March 2021
Fair value Carrying amount
Cash and bank balances 7,723,702.95 7,723,702.95
Accounts receivable 30,471,781.24 30,471,781.24
Advances to suppliers 2,318,717.10 2,318,717.10
Other receivables 2,129,844.69 2,129,844.69
Inventories 19,829,957.32 19,829,957.32
Other current assets 5,329,820.93 5,329,820.93
Fixed assets 1,335,373.90 1,335,373.90
Long-term prepaid expenses 724,925.12 724,925.12
Deferred tax assets 31,947.59 31,947.59
Accounts payable 47,041,828.70 47,041,828.70
Contract liabilities 123,430.92 123,430.92
Employee benefits payable 490,428.65 490,428.65
Tax payable 195,148.36 195,148.36
Other payables 1,546,264.21 1,546,264.21
Net assets 20,498,970.00 20,498,970.00
Less: Non-controlling interests 6,149,691.00 6,149,691.00
Net assets acquired 14,349,279.00 14,349,279.00
Amount exceeding the cost of merger recognised as
profit or loss in the current period 219,279.00
14,130,000.00 (1)
(1) The amount refers to the cash paid by the Group in business combination of RMB14,130,000.00.
Operating results and cash flows of Disheng Medicine for the period from the acquisition date to the
end of the year are presented as follows:
Period from 15 March 2021 to 31 December 2021
Operating revenue 175,812,144.79
Net profit 507,389.29
Net cash flows 3,030,379.85
301
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
The fair values and carrying amounts of identifiable assets and liabilities of Disheng Pharmaceutical Chain
on the acquisition date are presented as follows:
15 March 2021 15 March 2021
Fair value Carrying amount
Cash and bank balances 20,993,798.76 20,993,798.76
Accounts receivable 23,414,107.18 23,414,107.18
Advances to suppliers 91,212.94 91,212.94
Other receivables 3,414,254.84 3,414,254.84
Inventories 45,829,051.06 45,829,051.06
Other current assets 4,627,358.05 4,627,358.05
Fixed assets 2,000,261.19 2,000,261.19
Intangible assets 40,661,415.51 221,415.51
Long-term prepaid expenses 7,783,811.55 7,783,811.55
Right-of-use assets 41,047,873.29 41,047,873.29
Deferred tax assets 249,467.13 249,467.13
Accounts payable 13,321,430.50 13,321,430.50
Contract liabilities 1,818,156.15 1,818,156.15
Employee benefits payable 5,316,750.15 5,316,750.15
Tax payable 2,789,032.57 2,789,032.57
Other payables 19,444,396.39 19,444,396.39
Non-current liabilities due within one year 15,482,505.32 15,482,505.32
Lease liabilities 12,291,775.00 12,291,775.00
Deferred tax liabilities 6,066,000.00 -
Net assets 113,582,565.42 79,208,565.42
Less: Non-controlling interests 34,074,769.63 23,762,569.63
Net assets acquired 79,507,795.79 55,445,995.79
Goodwill arising from acquisition 158,492,204.21
238,000,000.00 (1)
(1) The amount refers to the cash of RMB238,000,000.00 paid by the Group in the business combination.
Among them, as at December 31, 2021, the Group has paid RMB71,400,000.00, and the rest will be
paid RMB95,200,000.00 and RMB71,400,000.00 respectively after the performance commitments in
2021 and 2022 are reached. The performance commitment for 2021 has been reached.
302
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
1.1 Acquisition of Disheng Pharmaceutical Chain (Continued)
Operating results and cash flows of Disheng Pharmaceutical Chain for the period from the acquisition date
to the end of the year are presented as follows:
Period from 15 March 2021 to 31 December 2021
Operating revenue 271,226,483.98
Net profit 20,675,257.28
Net cash flows 53,456,185.17
1.2 Acquisition of the management right of 15 directly-managed stores of Nantong Puji
Yangzhou Dadesheng, a subsidiary of the Group, obtained the management right of 15 directly-managed
stores of Nantong Puji at RMB14,138,139.12. The acquisition date was 2 March 2021.
The fair values and carrying amounts of identifiable assets and liabilities of 15 directly-managed stores of
Nantong Jipu on the acquisition date are presented as follows:
2 March 2021 2 March 2021
Fair value Carrying amount
Fixed assets 788,300.00 788,300.00
Inventories 1,751,439.12 1,751,439.12
Long-term prepaid expenses 100,300.00 100,300.00
Net assets 2,640,039.12 2,640,039.12
Net assets acquired 2,640,039.12 2,640,039.12
Goodwill arising from acquisition 11,498,100.00
14,138,139.12 (1)
(1) The amount refers to the cash of RMB14,138,139.12 paid by the Group in the business combination.
Operating results and cash flows of 15 directly-managed stores of Nantong Puji for the period from the
acquisition date to the end of the year are presented as follows:
Period from 2 March 2021 to 31 December 2021
Operating revenue 19,431,658.67
Net profit 933,185.58
Net cash flows 872,371.07
303
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VI Changes in scope of consolidation (Continued)
1. Business combinations not involving enterprises under common control (Continued)
1.3 Acquisition of the management right of 32 directly-managed stores of Huimin Kangwei
Huimin Luliang, a subsidiary of the Group, obtained the management right of 32 directly-managed stores
of Shanxi Huimin at RMB30,000,000.00. The acquisition date was 8 February 2021.
The fair values and carrying amounts of identifiable assets and liabilities of the management right of 32
directly-managed stores of Huimin Kangwei on the acquisition date are presented as follows:
8 February 2021 8 February 2021
Fair value Carrying amount
Inventories 7,399,161.00 7,399,161.00
Fixed assets 1,630,839.00 1,630,839.00
Net assets 9,030,000.00 9,030,000.00
Net assets acquired 9,030,000.00 9,030,000.00
Goodwill arising from acquisition 20,970,000.00
30,000,000.00 (1)
(1) The amount refers to the cash of RMB30,000,000.00 paid by the Group in business combination.
Operating results and cash flows of the management right of 32 directly-managed stores of Huimin
Kangwei for the period from the acquisition date to the end of the year are presented as follows:
Period from 8 February 2021 to 31 December 2021
Operating revenue 35,389,032.00
Net profit 1,452,541.00
Net cash flows 3,501,161.00
304
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VI Changes in scope of consolidation (Continued)
2. Establishment of subsidiaries
31 December 2021 2021
Net assets Net profit
Guoda Pharmacy (Heze) Co., Ltd. (“Guoda Heze”) (a)
8,060,915.85 (102,248.15)
Guigang Pharmacy (b)
1,001,468.44 1,468.44
Hunan Guoda Pharmacy Co., Ltd. (“Hunan Pharmacy “) (c)
- -
(a) On 10 September 2021, the Group and Shandong Luzhong Investment Co., Ltd. (“Shandong luzhong”)
accumulatively invested RMB5,100.00 thousand and RMB4,900.00 thousand to set up Guoda Heze respectively.
After the establishment, the Group held 51% of its equity interest in the company. As at the end of 2021, the
Group paid RMB4,163.20 thousand and Shandong Luzhong Investment Co., Ltd. paid RMB4,000.00 thousand.
(b) On 25 October 2021, the Group invested RMB1,000.00 thousand to establish Guigang Pharmacy. As at the end of
2021, the payment has been completed.
(c) On 31 December 2021, the Group invested RMB2,800.00 thousand to establish Hunan Pharmacy. As at the end
of 2021, no payment has been made.
3. Cancellation of subsidiaries
Registered Shareholding
Principal place Place of capital Nature of
Subsidiaries of business establishment (RMB’0.000) business Direct Direct Reasons
Guoda Drugstore Jilin Co., Ltd. Changchun Changchun 500.00 Commercial - 100.00 Cancellation
Liaoning Zhicheng Xingda
Advertising Media Co., Ltd. Benxi Benxi 500.00 Commercial - 100.00 Cancellation
305
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
business (RMB’0.000) Direct Indirect
(%)
Sinopharm Holding Business
Shenzhen Logistics combinations
Co., Ltd. involving entities
(“Shenzhen under common
Logistics") Shenzhen Shenzhen Services 500.00 100.00 - 100.00 control
Sinopharm Holding
Shenzhen
Traditional & Herbal Business
Medicine Co., Ltd. combinations
(“Sinopharm involving entities
Traditional & Herbal under common
Medicine") Shenzhen Shenzhen Commercial 1,500.00 100.00 - 100.00 control
Sinopharm Holding Business
Shenzhen Jianmin combinations
Pharmaceutical Co., involving entities
Ltd. (“Sinopharm under common
Jianmin") Shenzhen Shenzhen Commercial 2,000.00 100.00 - 100.00 control
Business
combinations
involving entities
not under
Sinopharm Yanfeng Shenzhen Shenzhen Commercial 3,000.00 51.00 - 51.00 common control
Sinopharm Accord
Medical
Devices(Shenzhen)
Co., Ltd.
(“Sinopharm Accord
Shenzhen Shenzhen Commercial 3,333.00 60.00 - 60.00 Establishment
Devices ") (a)
Business
combinations
involving entities
under common
Sinopharm Guangzhou Guangzhou Guangzhou Commercial 355,325.00 100.00 - 100.00 control
Sinopharm Holding
Guangzhou Medical
Treatment Co., Ltd. Guangzhou Guangzhou Commercial 2,000.00 - 51.00 51.00 Establishment
Sinopharm Holding
Guangyi Health
Management
(Zhanjiang) Co.,
Zhanjiang Zhanjiang Commercial 50.00 - 60.00 60.00 Establishment
Ltd.
Sinopharm Holding
Guangzhou Medical
Technology Co.,
Guangzhou Guangzhou Commercial 588.00 - 51.00 51.00 Establishment
Ltd.
Sinopharm Holding
Guangzhou Medical
Supply Chain
Guangzhou Guangzhou Commercial 2,000.00 - 51.00 51.00 Establishment
Service Co., Ltd.
Business
combinations
involving entities
not under
Sinopharm Holding
Heyuan Heyuan Commercial 1,340.00 - 70.00 70.00 common control
Heyuan Co., Ltd.
Sinopharm Holding
Foshan Medical
Consumables
Supply Chain Co.,
Foshan Foshan Commercial 800.00 - 70.00 70.00 Establishment
Ltd.
306
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
Principal place Place of Nature of Registered Shareholding (%) Voting Ways of
Subsidiaries of business establishment business capital proportion acquisition
(RMB’0.000) Direct Indirect (%)
Business
combinations
Sinopharm Holding involving entities
Guangzhou not under
Huadu Co., Ltd. Guangzhou Guangzhou Commercial 1,000.00 - 70.00 70.00 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
not under
Sinopharm Zhaoqing Zhaoqing Zhaoqing Commercial 4,000.00 - 100.00 100.00 common control
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
Sinopharm Holding
Zhongshan Co.,
Ltd. Zhongshan Zhongshan Commercial 3,000.00 - 100.00 100.00 Establishment
Business
combinations
involving entities
Sinopharm Holding not under
Shantou Co., Ltd. Shantou Shantou Commercial 2,100.00 - 100.00 100.00 common 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
Guangdong Huixin involving entities
Investment Co., under common
Ltd. Guangzhou Guangzhou Services 500.00 - 100.00 100.00 control
Business
combinations
involving entities
Sinopharm Holding under common
Foshan Co., Ltd. Foshan Foshan Commercial 4,100.00 - 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
307
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
(%)
Sinopharm Holding Business
Guangdong combinations
Yuexing Co., Ltd. involving entities
(“Sinopharm under common
Yuexing”) Guangzhou Guangzhou Commercial 23,000.00 - 100.00 100.00 control
Business
combinations
involving entities
not under
Sinopharm Dongguan Dongguan Dongguan Commercial 7,300.00 - 100.00 100.00 common control
Business
combinations
involving entities
not under
Sinopharm Zhanjiang Zhanjiang Zhanjiang Commercial 13,100.00 - 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 entities
Guangdong Special under 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
Business
combinations
involving entities
not under
Sinopharm Maoming Maoming Maoming Commercial 6,000.00 - 100.00 100.00 common control
Business
combinations
involving entities
not under
Guangzhou Medicine Guangzhou Guangzhou Commercial 200.00 - 70.00 70.00 common control
Business
combinations
involving entities
not under
Yangjiang Medicine Yangjiang Yangjiang Commercial 1,000.00 - 70.00 70.00 common control
308
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
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 Yulin Yulin Yulin Commercial 1,000.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Sinopharm Wuzhou Wuzhou Wuzhou Commercial 1,000.00 - 99.90 99.90 control
Sinopharm Baise Baise Baise Commercial 3,500.00 - 100.00 100.00 Establishment
Sinopharm Guilin Guilin Guilin Commercial 2,000.00 - 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
Medical Supply
Chain Service
(Guangxi) Co.,
Ltd. (c) Nanning Nanning Commercial 2,000.00 - 30.60 60.00 Establishment
Baiyi Pharmacy Nanning Nanning Commercial 200.00 - 51.00 51.00 Establishment
Sinopharm Hezhou Hezhou Hezhou Commercial 1,000.00 - 100.00 100.00 Establishment
Sinopharm Qinzhou Qinzhou Qinzhou Commercial 1,000.00 - 100.00 100.00 Establishment
309
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 Hechi Hechi Hechi Commercial 1,000.00 - 100.00 100.00 Establishment
Business
combinations
involving entities
under common
Sinopharm Liuzhou Liuzhou Liuzhou Commercial 2,053.06 - 51.00 51.00 control
Guigang Pharmacy
(d) Guigang Guigang Commercial 100.00 - 100.00 100.00 Establishment
Business
combinations
involving entities
under common
Guoda Drugstore Shanghai Shanghai Commercial 168,333.00 60.00 - 60.00 control
Business
combinations
involving entities
under common
Shanghai Chain Shanghai Shanghai Commercial 3,000.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Shanghai Dongsheng Shanghai Shanghai Commercial 50.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Shanghai Dongxin Shanghai Shanghai Commercial 30.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Shanghai Shanghong Shanghai Shanghai Commercial 100.00 - 51.00 51.00 control
Business
combinations
involving entities
Medical under common
Shanghai Guodong Shanghai Shanghai clinic 20.00 - 100.00 100.00 control
Guoda Yongsheng Shanghai Shanghai Commercial 80.00 - 55.00 55.00 Establishment
Shanghai Guoda
Haohai Pharmacy
Co., Ltd. Shanghai Shanghai Commercial 80.00 - 51.00 51.00 Establishment
Shanghai Ruijing Shanghai Shanghai Commercial 80.00 - 55.00 55.00 Establishment
310
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
under common
Yangzhou adesheng Yangzhou Yangzhou Commercial 4,400.00 - 93.68 93.68 control
Business
combinations
Tianjin Guoda involving entities
Pharmacy Chain under common
Store Co., Ltd. Tianjin Tianjin Commercial 1,000.00 - 80.00 80.00 control
Business
combinations
Beijing Guoda involving entities
Pharmacy Chain under common
Store Co., Ltd. Beijing Beijing Commercial 1,000.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Guoda Zhejiang Hangzhou Hangzhou Commercial 1,500.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Zhejiang Dongshan Hangzhou Hangzhou Commercial 50.00 - 51.00 51.00 control
Business
Sinopharm Holding combinations
Guoda Pharmacy involving entities
Guangdong Co., under common
Ltd. Shenzhen Shenzhen Commercial 5,000.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Guoda Guangzhou Guangzhou Guangzhou Commercial 200.00 - 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
combinations
involving entities
under common
Guoda Taishan Taishan Taishan Commercial 990.00 - 70.00 70.00 control
Sinopharm Holdings
Guozhi
Pharmacy Chain
(Heyuan) Co.,
Ltd. Heyuan Heyuan Commercial 500.00 - 70.00 70.00 Establishment
Business
combinations
involving entities
under common
Guoda Guangxi Liuzhou Liuzhou Commercial 200.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Guangxi Consulting Nanning Nanning Commercial 300.00 - 100.00% 100.00% control
311
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (%)
Business
combinations
involving entities
under common
Guoda Ningxia Yinchuan Yinchuan Commercial 7,000.00 - 70.00 70.00 control
Business
combinations
involving entities
Xinjiang New & Special under common
Medicines Urumqi Urumqi Commercial 612.24 - 51.00 51.00 control
Business
combinations
involving entities
under common
Guoda Shenyang Shenyang Shenyang Commercial 5,000.00 - 51.00 51.00 control
Sinopharm Guoda Drug
Store Anshan Chain
Co., Ltd. Anshan Anshan Commercial 600.00 - 51.00 51.00 Establishment
Sinopharm holding Guoda
pharmacy
yongxingtang chain
(Chaoyang) Co., Ltd. Chaoyang Chaoyang Commercial 3,800.00 - 51.00 51.00 Establishment
Business
combinations
Guoda pharmacy involving entities
(Chaoyang) Ren'ai not under common
pharmacy Co., Ltd. Chaoyang Chaoyang Commercial 50.00 - 51.00 51.00 control
Liaoning Guoda
Pharmaceutical Co.,
Ltd. Shenyang Shenyang Commercial 2,000.00 - 100.00 100.00 Establishment
Liaoning Health Shenyang Shenyang Commercial 500.00 - 100.00 100.00 Establishment
Liaoning Guoda
Pharmacy Chain Co.,
Ltd. Dalian Dalian Commercial 2,000.00 - 100.00 100.00 Establishment
Liaoning Huludao (e) Huludao Huludao Commercial 100.00 - 100.00 100.00 Establishment
Business
combinations
involving entities
under common
Guoda Nanjing Nanjing Nanjing Commercial 800.00 - 60.00 60.00 control
Business
combinations
involving entities
under common
Guoda Shandong Linyi Linyi Commercial 2,900.00 - 55.00 55.00 control
312
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (%)
Guoda Rizhao Rizhao Rizhao Commercial 150.00 100.00 100.00 Establishment
Guoda Heze (f) Zehe Zehe Commercial 1,000.00 51.00 51.00 Establishment
Business
combinations
involving entities
Anhui Guoda Pharmacy under common
Chain Store Co., Ltd. Hefei Hefei Commercial 1,000.00 - 60.00 60.00 control
Business
combinations
involving entities
under common
Guoda Quanzhou Quanzhou Quanzhou Commercial 2,000.00 - 51.00 51.00 control
Business
combinations
involving entities
under common
Guoda Hunan Hengyang Hengyang Commercial 2,000.00 - 51.00 51.00 control
Hunan Medicine (g) Hengyang Hengyang Commercial 280.00 - 100.00 100.00 Establishment
Business
combinations
involving entities
under common
Shanxi Wanmin Taiyuan Taiyuan Commercial 2,000.00 - 85.00 85.00 control
Business
combinations
involving entities
under common
Changzhi Wanmin Changzhi Changzhi Commercial 320.00 - 51.00 51.00 control
Business
combinations
Shanxi Tongfeng involving entities
Pharmacy Logistics under common
Co., Ltd. Taiyuan Taiyuan Commercial 500.00. - 100.00 100.00 control
Business
combinations
involving entities
Medical under common
Wanmin Chain Taiyuan Taiyuan services 120.00. - 100.00 100.00 control
Business
combinations
involving entities
under common
Xiaoyi Wanmin Xiaoyi Xiaoyi Commercial 622.22 - 70.00 70.00 control
Jinzhong Yuci Guoda
Wanmin Clinic Co.,
Ltd. Jinzhong Jinzhong Commercial 10.00 - 100.00 100.00 Establishment
313
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (%)
Huimin Lvliang (h) LvLiang LvLiang Commercial 3,200.00 - 51.00 51.00 Establishment
Business
combinations
involving entities
under common
Liyang Guoda Liyang Liyang Commercial 2,500.00 - 80.00 80.00 control
Business
combinations
involving entities
under common
Guoda Henan Pingdingshan Pingdingshan Commercial 1,500.00 - 60.00 60.00 control
Business
combinations
involving entities
under common
Guoda Inner Mongolia Hohhot Hohhot Commercial 5,000.00 - 96.70 96.70 control
Business
combinations
involving entities
under common
Guoda Hulun Buir Hulun Buir Hulun Buir Commercial 1,000.00 - 51.00 51.00 control
Guoda Ulanqab Ulanqab Ulanqab Commercial 500.00 - 60.00 60.00 Establishment
Guoda Manchuria Manchuria Manchuria Commercial 50.00 - 51.00 51.00 Establishment
Establishment
Guoda Bayannur Bayannur Bayannur Commercial 2,000.00 - 80.00 80.00
Establishment
Inner Mongolia Medicine Hohhot Hohhot Commercial 2,000.00 - 100.00 100.00
Business
combinations
involving entities
under common
Hebei Lerentang Shijiazhuang Shijiazhuang Commercial 3,500.00 - 60.00 60.00 control
Business
Sinopharm Lerentang combinations
Shijiazhuang involving entities
Pharmaceutical Co., under common
Ltd. Shijiazhuang Shijiazhuang Commercial 200.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Guoda Jiangmen (i) Jiangmen Jiangmen Commercial 2,400.00 - 65.00 65.00 control
314
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (%)
Guoda Jianfeng
(Jiangmen)
Establishment
Pharmaceutical Chain
Co., Ltd. (j) Jiangmen Jiangmen Commercial 1,251.97 - 51.00 51.00
Business
combinations
involving entities
under common
Shanxi Yiyuan Taiyuan Taiyuan Commercial 1,000.00 - 80.00 80.00 control
Business
Sinopharm Holding combinations
Guoda Shanxi involving entities
Pharmaceutical Co., not under common
Ltd. Taiyuan Taiyuan Commercial 1,000.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Taiyuan Tongxinli (k) Taiyuan Taiyuan Commercial 560.00 - 100.00 100.00 control
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 Chain under common
Store Shanghai Shanghai Commercial 5,000.00 - 99.76 99.76 control
Business
Shanghai Yutaitang combinations
Chinese Traditional involving entities
Medicine Clinic Co., under common
Ltd. Shanghai Shanghai Commercial 100.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
ForMe Xuhui Shanghai Shanghai Commercial 25.00 - 100.00 100.00 control
Business
combinations
involving entities
under common
Beijing Golden Elephant Beijing Beijing Commercial 4,222.22 - 53.13 53.13 control
Business
combinations
Sanhe Liyang Golden involving entities
Elephant Pharmacy under common
Co., Ltd. Langfang Langfang Commercial 1.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Golden Elephant Guoxing Beijing Beijing Commercial 50.00 - 100.00 100.00 control
Sinopharm Holding
Guoda Pharmacy
Zhengzhou Chain
Store Co., Ltd Zhengzhou Zhengzhou Commercial 2,000.00 - 60.00 60.00 Establishment
315
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (%)
Fujian Guoda
Pharmaceutical Co., Establishment
Ltd. Xiamen Xiamen Commercial 1,500.00 - 100.00 100.00
Business
combinations
involving entities
under common
Guoda Fujian Xiamen Xiamen Commercial 3,750.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Guoda Pu’er Pu’er Pu’er Commercial 500.00 - 60.00 60.00 control
Business
combinations
involving entities
not under common
Shanghai Dingqun Shanghai Shanghai services 79,050.00 - 100.00 100.00 control
Business
Sinopharm Holding combinations
Tianhe Jilin involving entities
Pharmaceutical Co., not under common
Ltd. Changchun Changchun Commercial 2,155.67 - 85.00 85.00 control
Business
combinations
involving entities
Jilin Yihe Drug Store Co., not under common
Ltd. Changchun Changchun Commercial 500.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Jilin Donglong Changchun Changchun Commercial 500.00 - 100.00 100.00 control
Business
Yushu City Dinghe combinations
Medical involving entities
Pharmaceutical not under common
Technology Co., Ltd. Changchun Changchun Commercial 500.00 - 51.00 51.00 control
Business
combinations
involving entities
not under common
Yanji Xianghe Yanji Yanji Commercial 1,000.00 - 51.00 51.00 control
Business
combinations
involving entities
under common
Pudong Medicine (l) Shanghai Shanghai Commercial 2,000.00 - 75.00 75.00 control
Business
combinations
Shanghai Yanghetang involving entities
Pharmaceutical Chain under common
Operation Co., Ltd. (m) Shanghai Shanghai Commercial 1,292.60 - 100.00 100.00 control
Business
combinations
involving entities
under common
Pudong Yanghetang Shanghai Shanghai Commercial 50.00 - 100.00 100.00 control
316
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 (%)
Business
combinations
CDFY involving entities
not under common
Shenyang Shenyang Commercial 23,000.00 - 100.00 100.00 control
Business
combinations
involving entities
Shandong Chengda not under common
Fangyuan Qingdao Qingdao Commercial 5,000.00 - 100.00 100.00 control
Business
combinations
involving entities
Liaoning Chengda not under common
Pharmacy Chains Shenyang Shenyang Commercial 8,000.00 - 100.00 100.00 control
Business
Chengda Fangyuan combinations
(Liaoning) New and involving entities
Special Drugs Chain not under common
Co., Ltd. Shenyang Shenyang Commercial 5,000.00 - 80.00 80.00 control
Business
Liaoning Chengda combinations
Fangyuan Vocational involving entities
and Technical Training not under common
School Shenyang Shenyang services 200.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Liaoning Cdfy Pharm Shenyang Shenyang Commercial 5,000.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Dalian Zhengda Dalian Dalian Commercial 500.00 - 100.00 100.00 control
Business
combinations
involving entities
not under common
Hebei Chengda Fangyuan Qinghuangdao Qinghuangdao Commercial 2,000.00 - 100.00 100.00 control
Business
Liaoning Chengda combinations
Fangyuan involving entities
Pharmaceutical not under common
Logistics Co., Ltd. Shenyang Shenyang services 1,500.00 - 100.00 100.00 control
Business
combinations
Liaoning Chengda involving entities
Fangyuan Logistics not under common
Co., Ltd. Shenyang Shenyang services 200.00 - 100.00 100.00 control
Business
combinations
Jilin Chengda Fangyuan involving entities
Pharmaceutical Co., not under common
Ltd. Changchun Changchun Commercial 1,000.00 - 80.00 80.00 control
Business
combinations
Jilin Chengda Fangyuan involving entities
Pharmaceutical Chain not under common
Co., Ltd. Changchun Changchun Commercial 500.00 - 99.00 99.00 control
317
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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) (%)
Business
combinations
Inner Mongolia Chengda involving entities
Fangyuan Medicine not under common
Co., Ltd. Chifeng Chifeng Commercial 400.00 - 70.00 70.00 control
Business
Inner Mongolia Chengda combinations
Fangyuan involving entities
Pharmaceutical Chain not under common
Co., Ltd. Chifeng Chifeng Commercial 200.00 - 99.00 99.00 control
Business
combinations
involving entities
not under common
Disheng Medicine (n) Xishuangbanna Xishuangbanna Commercial 2,000.00 - 70.00 70.00 control
Business
combinations
involving entities
Disheng Pharmaceutical not under common
Chain (o) Xishuangbanna Xishuangbanna Commercial 6,900.00 - 70.00 70.00 control
318
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VII Interests in other entities (Continued)
1. Interests in subsidiaries (Continued)
The subsidiaries of the Group (Continued)
(a) On 12 July 2021, Sinopharm Accord Medical Supply Chain (Shenzhen) Co., Ltd. was renamed as
Sinopharm Accord Medical Devices (Shenzhen) Co., Ltd.
(b) On 20 April 2021, Guangdong Uptodate & Special Medicines was renamed as Sinopharm Guangdong
Uptodate & Special Medicines Co., Ltd.
(c) On 28 December 2021, the Group, Guorun Medical Supply Chain Service (Shanghai) Co., Ltd. ("Guorun
Medical Supply Chain") and Guangxi Deyiyuan Medical Investment Center accumulatively invested
RMB6,120.00 thousand, RMB5,880.00 and RMB8,000.00 thousand respectively to set up Sinopharm
Holding Medical Supply Chain Service (Guangxi) Co., Ltd.. After the establishment, the Group held 60% of
equity in the company.
(d) On 25 October 2021, the Group invested RMB1,000.00 thousand to set up Guigang Pharmacy. As at the
end of 2021, payment has been completed.
(e) On 14 December 2020, the Group invested RMB1,000.00 thousand to set up Liaoning Huludao. As at the
end of 2021, RMB500.00 has been completed.
(f) On 31 September 2021, the Group and Shandong Luzhong accumulatively invested RMB5,100.00
thousand and RMB4,900.00 thousand to set up Guoda Heze respectively. After the establishment, the
Group held 51% of equity in the company. As at the end of 2021, the group paid RMB4,163.20 thousand
and Shandong Luzhong paid RMB4,000.00 thousand.
(g) On 31 September 2021, the Group invested RMB2,800.00 thousand to set up Hunan Pharmacy. As at the
end of 2021, payment has not been completed yet.
(h) On 28 September 2020, the Group and Wenshui Weikang Trading Co., Ltd accumulatively invested
RMB16,320.00 thousand and RMB15,680.00 thousand respectively to set up Huimin Lvliang. After the
establishment, the Group held 51% of equity in the company. As at the end of 2021, payment has been
completed.
(i) On 14 January 2022, Sinopharm holding Guoda pharmacy Jiangmen Chain Co., Ltd. was renamed as
Sinopharm United Guoda(Jiangmen) Co., Ltd.
(j) On 26 September 2020, the Group and Jiangmen Xinhui Jianfeng Pharmaceutical Co., Ltd. accumulatively
invested RMB6,385.10 thousand and RMB6,134.70 thousand respectively to set up Sinopharm Guoda
Jianfeng (Jiangmen) pharmaceutical chain Co., Ltd. After the establishment, the Group held 51% of equity
in the company. As at the end of 2021, payment has been completed.
(k) On 27 January 2022, Taiyuan Tongxinli had completed the cancellation of the business license.
Cancellation announcement period is from 30 November 2021 to 13 January 2022.
(l) On 21 June 2021, the registered capital of Pudong Medicine was changed from RMB13,895.50 thousand
to RMB20,000.00 thousand. After the change, the Group subscribed RMB15,000.00 thousand of registered
capital. As at the end of 2021, payment has been completed.
(m) On 2 August 2021, the registered capital of Shanghai Yanghetang Pharmaceutical Chain Operation Co.,
Ltd. was changed from RMB6,821.50 thousand to RMB12,926.00 thousand. After the change, the Group
subscribed RMB12,926.00 thousand of registered capital. As at the end of 2021, payment has been
completed.
319
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VII Interests in other entities (Continued)
1． Interests in subsidiaries (Continued)
The subsidiaries of the Group (Continued)
(n) On 15 March 2021, the Group acquired 70% equity in Disheng Medicine from Xishuangbanna Disheng
Pharmaceutical Co., Ltd. for RMB14,130.00 thousand, which formed a business combination not involving
enterprises under common control. The acquisition was completed on 15 March 2021 and was included in
the scope of consolidation.
(o) On 15 March 2021, the Group acquired 70% equity in Disheng Pharmacy Chain from Xishuangbanna
Disheng Pharmaceutical Co., Ltd. for RMB238,000.00 thousand, which formed a business combination not
involving enterprises under common control. The acquisition was completed on 15 March 2021 and was
included in the scope of consolidation.
320
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021
Percentage of Profit Dividend paid to Accumulated balances of
equity interest for this year non-controlling non-controlling interests
held by attributable to interests at the date of the
non-controlling non-controlling balance sheet
interests interests
Guoda
Drugstore 40.00% 26,093,167.04 - 1,963,914,199.87
2020
Percentage of Profit Dividend paid to Accumulated balances of
equity interest for this year non-controlling non-controlling interests
held by attributable to interests at the date of the
non-controlling non-controlling balance sheet
interests interests
Guoda
Drugstore 40.00% 136,490,577.03 - 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
2021 2020
Current assets 9,093,088,349.46 8,886,545,970.79
Non-current assets 6,890,746,889.09 6,570,327,751.04
Total assets 15,983,835,238.55 15,456,873,721.83
Current liabilities 8,912,034,922.32 8,541,421,518.15
Non-current liabilities 1,389,487,840.12 1,375,989,559.14
Total liabilities 10,301,522,762.44 9,917,411,077.29
Operating revenue 22,477,630,028.55 19,437,660,100.65
Net profit 184,049,100.87 476,588,088.95
Total comprehensive income 156,299,080.40 464,188,594.16
Net cash flows from operating activities 1,674,844,216.57 2,002,315,496.43
321
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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(a) 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(b) Zhanjiang Zhanjiang Commercial - 10.00 Equity
Jialong Hainan(c) Chengmai Chengmai Commercial - 25.00 Equity
(a) 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 has one vote on the board, taking 11.11% of the voting rights. Except for special
resolutions adopted by half of the board of directors. The Group has significant influence over
Shyndec Pharma.
(b) 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 20.00%
of voting rights. The voting right of resolutions of the board of directors is one vote for one
person. Except for some special matters, other resolutions of the board of directors are
approved by more than two-thirds of all directors. Therefore, the Group has significant
influence over Guangdong Jianhui.
(c) On 9 August 2021, the Group jointly established Jialong Hainan with Hainan Yushan
Changxing Health Management Co., Ltd, with the share percentages being 25.00% and
75.00%, respectively. According to the Articles of Association, the board of directors of Jialong
Hainan 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
Jialong Hainan, and thus, it is considered as an associate of the Group.
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.
322
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VII Interests in other entities (Continued)
2. Interests in associates (Continued)
The following table illustrates the summarised financial information in respect of Shyndec Pharma:
2021 2020
Current assets 10,886,446,261.52 10,162,475,190.65
Non-current assets 8,183,515,130.93 8,087,979,595.07
Total assets 19,069,961,392.45 18,250,454,785.72
Current liabilities 6,842,570,937.46 6,194,362,158.11
Non-current liabilities 1,857,531,965.46 2,236,726,740.99
Total liabilities 8,700,102,902.92 8,431,088,899.10
Non-controlling interests 1,777,094,904.67 1,688,157,191.81
Shareholders’ equity attributable to
shareholders of the parent
company 8,592,763,584.86 8,131,208,694.81
Group’s share of net assets by
proportion of ownership interests 1,398,901,911.62 1,323,760,775.52
Carrying amount of the investment 1,398,901,911.62 1,323,760,775.52
Operating revenue 13,944,948,270.25 12,556,281,595.67
Income taxes 97,062,929.19 141,079,935.05
Net profit 821,145,853.02 900,046,866.22
Total comprehensive income 821,398,880.77 900,079,623.42
Dividend received 16,714,220.20 16,714,220.20
323
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021 2020
Current assets 1,084,994,896.84 1,076,146,345.00
Non-current assets 161,776,731.97 124,495,504.04
Total assets 1,246,771,628.81 1,200,641,849.04
Current liabilities 264,584,338.32 275,509,215.17
Non-current liabilities 14,610,760.83 8,120,000.00
Total liabilities 279,195,099.15 283,629,215.17
Shareholders’ equity attributable to
shareholders of the parent
company 967,576,529.66 917,012,633.87
Group’s share of net assets by
proportion of ownership interests 340,490,180.80 322,696,745.87
Carrying amount of the investment 340,490,180.80 322,696,745.87
Operating revenue 980,321,533.72 1,044,631,857.57
Income taxes 43,975,748.31 44,375,861.78
Net profit 250,563,895.80 260,214,204.60
Total comprehensive income 250,563,895.80 260,214,204.60
Dividend received 70,380,000.00 63,342,000.00
324
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VII Interests in other entities (Continued)
2. Interests in associates (Continued)
The following table illustrates the summarised financial information in respect of Zhijun Medicine:
2021 2020
Current assets 1,435,210,018.93 1,176,812,039.37
Non-current assets 261,609,950.81 238,613,242.87
Total assets 1,696,819,969.74 1,415,425,282.24
Current liabilities 671,896,297.56 541,117,019.88
Non-current liabilities 11,570,731.00 5,822,904.95
Total liabilities 683,467,028.56 546,939,924.83
Shareholders’ equity attributable to
shareholders of the parent company 1,013,352,941.18 868,485,357.41
Group’s share of net assets by
proportion of ownership interests 496,542,941.16 425,557,825.11
Carrying amount of the investment 496,542,941.16 425,557,825.11
Operating revenue 1,540,518,885.53 1,364,530,022.63
Income taxes 33,788,074.25 20,277,618.43
Net profit 224,660,769.57 159,586,371.60
Total comprehensive income 224,660,769.57 159,586,371.60
Dividend received 39,098,661.04 53,218,071.65
325
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021
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 - 5,126,159,080.94 - - 5,126,159,080.94
Notes receivable - 680,196,380.57 - - 680,196,380.57
Accounts receivable - 15,964,603,345.91 - - 15,964,603,345.91
Receivables
financing - - 1,027,226,940.21 - 1,027,226,940.21
Other receivables - 718,089,129.10 - - 718,089,129.10
Other non-current
financial assets 135,974,908.51 - - - 135,974,908.51
Other equity instrument
investment - - - 62,488,312.99 62,488,312.99
135,974,908.51 22,489,047,936.52 1,027,226,940.21 62,488,312.99 23,714,738,098.23
Financial liabilities Financial liabilities at amortised cost
Short-term borrowings 1,930,467,146.38
Notes payable 7,660,216,823.68
Accounts payable 9,057,718,968.14
Other payables 1,714,746,986.46
Non-current liabilities due within 1 year 848,328,648.14
Lease liabilities 1,375,427,877.28
Long-term borrowings 71,637,173.89
Other non-current liabilities 71,400,000.00
22,729,943,623.97
326
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VIII Risks related to financial instruments (Continued)
1. Classification of financial instruments (Continued)
2020
Financial assets at
fair value
Financial assets through profit or Financial assets at fair value through
Financial assets at
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
327
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021, the Group had endorsed commercial acceptance bills (the "Endorsed
Bills") with a carrying amount of RMB0.00 (31 December 2020: RMB4,095,283.92) 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 RMB31,886,681.19 (31 December 2020: nil) to
certain of its suppliers to settle accounts payable due to such suppliers. As at 31 December
2021, the Group had discounted commercial acceptance bills (the “Discounted Bills”) with a
carrying amount of RMB0.00 (31 December 2020: nil) 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 2021, the total carrying value of accounts payable settled by the Group was
RMB31,886,681.19 (31 December 2020: RMB4,095,283.92).
328
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021, the Group had endorsed bank acceptance bills (the "Endorsed Bills")
with a carrying amount of RMB1,222,202,123.45 (31 December 2020: RMB1,283,369,787.75)
to certain of its suppliers to settle accounts payable due to such suppliers. As at 31 December
2021, the Group had discounted bank acceptance bills (the "Discounted Bills") with a carrying
amount of RMB984,152,993.81 (31 December 2020: RMB330,472,883.05) to banks. As at 31
December 2021, 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 2021, 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 2021, 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.
329
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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. 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.
330
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
VIII Risks related to financial instruments (Continued)
3. Risks of financial instruments (Continued)
Credit risk (Continued)
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.
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
interest).
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.
331
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021, the Group had no significant overdue receivables (31 December 2020:
nil).
332
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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 2021
Within 1 year 1 to 2 years 2 to 5 years Above 5 years Total
Short-term borrowings 1,947,231,588.48 - - - 1,947,231,588.48
Long-term borrowings - 34,379,752.78 40,881,388.89 - 75,261,141.67
Notes payable 7,660,216,823.68 - - - 7,660,216,823.68
Accounts payable 9,057,718,968.14 - - - 9,057,718,968.14
Other payables 1,714,746,986.46 - - - 1,714,746,986.46
Non-current liabilities due within 1 year 984,474,954.40 - - - 984,474,954.40
Lease liabilities - 671,938,054.49 727,760,496.55 19,832,053.23 1,419,530,604.27
Other non-current liabilities - 71,400,000.00 - - 71,400,000.00
21,364,389,321.16 777,717,807.27 768,641,885.44 19,832,053.23 22,930,581,067.10
333
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 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 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 62,444,333.58 1,351,939,233.21
19,313,574,359.92 608,291,438.58 714,733,123.83 62,444,333.58 20,699,043,255.91
334
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
335
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021, 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 RMB118,500.00 (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 increase or decrease by RMB97,072.60).
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
2021 and 2020, the Group had not entered into any interest rate swap agreements.
For the year ended 31 December 2021, the Group had long-term interest-bearing borrowings
with floating interest rates and fixed interest rates amounting to RMB71,600,000.00 (31
December 2020: 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.
336
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021 2020
Gearing ratio 57.88% 57.35%
337
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
IX Disclosure of fair value
1. Assets and liabilities at fair value
2021
Input applied in the measurement of fair value
Quoted prices in Significant Significant
active markets observable inputs unobservable inputs Total
Level 1 Level 2 Level 3
Continuous measurement of fair
value
Receivables financing - 1,027,226,940.21 - 1,027,226,940.21
Other investment in equity
instruments - 62,488,312.99 - 62,488,312.99
Other non-current financial
assets - - 135,974,908.51 135,974,908.51
- 1,089,715,253.20 135,974,908.51 1,225,690,161.71
2020
Input applied in the measurement of fair value
Quoted prices in Significant Significant
active markets observable inputs unobservable inputs Total
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
338
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
IX Disclosure of fair value (Continued)
2. Assets and liabilities disclosed at fair value
2021
Input applied in the measurement of fair value
Quoted prices in Significant Significant
active markets observable inputs unobservable inputs Total
Level 1 Level 2 Level 3
Long-term borrowings - 71,637,173.89 - 71,637,173.89
2020
Input applied in the measurement of fair value
Quoted prices in Significant Significant
active markets observable inputs unobservable inputs Total
Level 1 Level 2 Level 3
Long-term borrowings - 31,637,173.89 - 31,637,173.89
3. Estimation of fair value
The following is 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 2021 31 December 2020 31 December 2021 31 December 2020
Financial liabilities - - - -
Long-term borrowings 71,637,173.89 31,637,173.89 71,637,173.89 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 2021, 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 is also the most sufficient value at the balance sheet date.
339
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
IX Disclosure of fair value (Continued)
4. Unobservable inputs
Other non-current financial assets were the fund shares of Ningbo Meishan Bonded Port Area Qirui Equity
Investment Center LP and Gongqingcheng Qixin 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 Qirui Equity
Investment Center LP and Gongqingcheng Qixin on 31 December 2021, 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.
340
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 Shantou Jinshi Pharmaceutical Co., Ltd. Controlled by CNPGC
China National of Traditional & Herbal Medicine Co., Ltd. Controlled by CNPGC
Huayi Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Beijing Huamiao Pharmaceutical Co., Ltd. Controlled by CNPGC
Sichuan Jiangyou Zhongba Aconiti Science and Technology Development
Co., Ltd. Controlled by CNPGC
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. Controlled by CNPGC
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. Controlled by CNPGC
Foshan Winteam Pharmaceutical Group Ltd. Controlled by CNPGC
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. Controlled by CNPGC
China Biotechnology Technology Co., Ltd. Controlled by CNPGC
Chengdu Rongsheng Pharmacy Co., Ltd. Controlled by CNPGC
Shanghai Zeno Biotechnology Co., Ltd. Controlled by CNPGC
Lanzhou Biotechnology Development Co., Ltd. Controlled by CNPGC
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. Controlled by CNPGC
Shanghai Shangsheng Biological Products Co., Ltd. Controlled by CNPGC
Shantou Jinshi Powder Injection Co., Ltd. Controlled by CNPGC
Chengdu Institute of Biological Products Co., Ltd. Controlled by CNPGC
China National Pharmaceutical Industry Co., Ltd. Controlled by CNPGC
Sinopharm Weiqida Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Xinjiang Pharmaceutical Co., Ltd. Controlled by CNPGC
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. Controlled by CNPGC
341
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. Controlled by CNPGC
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. Controlled by CNPGC
Sinopharm Wuhan Zhonglian Siyao Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm ChuanKang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Financial Co., Ltd. Controlled by CNPGC
China Sinopharm International Corporation Controlled by CNPGC
Sinopharm Fortune Way Company Controlled by CNPGC
China National Pharmaceutical Foreign Trade Corporation Controlled by CNPGC
Sinopharm Foreign Trade (Beijing) Co., Ltd. Controlled by CNPGC
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. Controlled by CNPGC
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. Controlled by CNPGC
Guangdong Yifang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Yixin Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm ChangChun A-THINK Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Sanyi Medicine (Wuhu) Co., Ltd. Controlled by CNPGC
Sinopharm Wuhan Blood Products Co., Ltd. Controlled by CNPGC
Wuhan Zhongsheng Yujin Biomedical Co., Ltd. Controlled by CNPGC
Sinopharm Group Fengliaoxing Medical Hospital (Foshan Nanhai) Co., Ltd. Controlled by CNPGC
Fujian Tianjiang Pharmaceutical Co., Ltd. Controlled by CNPGC
Chongqing Tianjiang Yifang Pharmaceutical Co., Ltd. Controlled by CNPGC
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. Controlled by CNPGC
Sinopharm Group Fengliaoxing Pharmacy (Foshan) Co., Ltd. Controlled by CNPGC
Foshan Chengnan Fengliaoxing Medical Hospital Co., Ltd. Controlled by CNPGC
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. Controlled by CNPGC
Hubei Sinopharm Zhonglian Medicine Co., Ltd. Controlled by CNPGC
Taiji Group Co., Ltd. Controlled by CNPGC
Taiji Group Chongqing Fuling Pharmaceutical Factory Co., Ltd. Controlled by CNPGC
Taiji Group Sichuan Nanchong Pharmaceutical Co., Ltd. Controlled by CNPGC
Chongqing Tongjunge Co., Ltd. Controlled by CNPGC
Taiji Group Chongqing No.2 Traditional Chinese Medicine Factory Co., Ltd. Controlled by CNPGC
Chongqing Taiji Group TongJunGe Pharmaceutical Co. Ltd. Controlled by CNPGC
Sichuan Taiji Pharmacy Chain Co., Ltd. Controlled by CNPGC
Southwest Pharmaceutical Co., Ltd. Controlled by CNPGC
Gansu Tianshui Zhangjiachuan Donkey-hide Gelatin Factory Controlled by CNPGC
Zhejiang Dongfang Pharmaceutical Co., Ltd. Controlled by CNPGC
Taiji Group Sichuan Mianyang Pharmaceutical Co., Ltd. Controlled by CNPGC
Taiji Group Sichuan Tiancheng Pharmaceutical Co., Ltd. Controlled by CNPGC
342
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
China National Pharmaceutical Group Shanxi Rfl Pharmaceutical Co., Ltd. Associate of CNPGC
Changchun Changsheng Gene Pharmaceutical Co., Ltd. Associate of CNPGC
China Otsuka Pharmaceutical Co., Ltd. Associate of CNPGC
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. Associate of CNPGC
Sinopharm Holding Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Linfen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanghai Co., Ltd. Controlled by Sinopharm Group
Sinopharm Chemical Reagent Co., Ltd. Controlled by Sinopharm Group
Beijing Sinopharm Tianyuan Real Estate & Property Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Southwest Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Tianjin Binhai) Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tianjin North Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shenyang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dalian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dalian Special Drug Store Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anshan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Liaoning Medical Equipment Distribution Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shaanxi Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Medical Consumables Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shiyan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Hubei) Hankou Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Guoda Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Wuhan Guoda Pharmacy Chain Co., Ltd. Controlled by Sinopharm Group
Sinophanm Medicine HckLing (Hubei) Essential Drug Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hubei Hongyuan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuhan Hongshen Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Shanxi Linfen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Jinzhong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Jincheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. Controlled by Sinopharm Group
343
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Group Medicine Logistic Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medicine Logistic Co., Ltd. Guangzhou Branch Controlled by Sinopharm Group
Sinopharm Holding Hunan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medicine Holding Chenzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changde Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hunan Weian Pharmacy Medicine Chain Company Limited Controlled by Sinopharm Group
Sinopharm Holding Hengyang Co., Ltd. Controlled by Sinopharm Group
China National Medicines Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guorui Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Pharmaceutical Logistics Co., Ltd. Controlled by Sinopharm Group
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Beijing Huahong co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhejiang Co., Ltd. Controlled by Sinopharm Group
Shanghai Tongyu Information Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Sub Marketing Center Co., Ltd. Controlled by Sinopharm Group
Shanghai Shengxin Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Henan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiaozuo Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shangqiu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pingdingshan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuhu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shandong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lunan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Rizhao Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Linyi Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jinan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dezhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Liaocheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding (Shandong) Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yunnan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pu'er Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Honghe Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chuxiong Co., Ltd. Controlled by Sinopharm Group
344
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Kunming Pharmacy Co., Ltd. Controlled by Sinopharm Group
Yuxi Sinopharm Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Kunming Co., Ltd. Controlled by Sinopharm Group
Yunnan Sinopharm Holding Dongchang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hainan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hainan Hongyi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guanai Jikun Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Gansu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fujian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Putian Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Longyan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhangzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ningde Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Quanzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xiamen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanping Newforce Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Medical Devices Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ningxia Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiangxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Xinyu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Fuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anshun Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tongren Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zunyi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Qianxinan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Inner Mongolia Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Tongliao Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Baotou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ulanqab Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Bayannur Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chifeng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hulun Buir Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Ordos Co., Ltd. Controlled by Sinopharm Group
Sinopharm In Inner Mongolia Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
345
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Special Drugs Kashgar Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinjiang Xinte Shenrong Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Xinjiang Baitong Property Service Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xinte Yili Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Med-Tech Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jilin Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jilin Chain Store Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Professional Pharmacy Songyuan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wenzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chongqing Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Jiangsu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Biological Products Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Taizhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhenjiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nantong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Wuxi Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lianyungang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Xuzhou Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Yancheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Heilongjiang Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Chengde Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Shijiazhuang Traditional Chinese Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Zhangjiakou Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Hengshui Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Handan Medicine Co., Ltd. Controlled by Sinopharm Group
346
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Lerentang Tangshan Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Langfang Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Xintai Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Shijiazhuang Medical Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Hongkang Pharmaceutical Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Qinghai Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Shanghai Merro Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Lingshang Hospital Management Services (Shanghai) Co.,
Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chongqing Taimin Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Chongqing Health Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanghai Biomedicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Sichuan Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Chengdu Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Dalian Hecheng Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hongrun Medical Business Service (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changsha Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Pharmacy (Shanghai) Co., Ltd. Controlled by Sinopharm Group
Guorun medical Controlled by Sinopharm Group
China National Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Hunan Prov. Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument Guizhou Qiannan Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou (Zunyi) Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm (Dalian) Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm (Tianjin) Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Hebei Medical Instrument Co., Ltd. Controlled by Sinopharm Group
China Medical Equipment Shandong Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guangdong Medicine Device Co., Ltd. Controlled by Sinopharm Group
China National Scientific Instruments & Materials I&E Shenzhen Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guangdong Medical Examination Co., Ltd. Controlled by Sinopharm Group
Sinopharm Shenzhen Medicine Device Co., Ltd. Controlled by Sinopharm Group
347
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Zhuhai Medical Instrument Co., Ltd. Controlled by Sinopharm Group
Sinopharm Instruments (Jiangmen) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument (Foshan) Co., Ltd. Controlled by Sinopharm Group
China National Medical Device (Hui Zhou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guangdong Medicine Device Supply Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Liaoning Medical Equipment Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanxi Medical Devices Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Guangxi Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Shanghai Medicine Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm United Medical Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Group Medical Management Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Hunan Pharmaceutical Development Co., Ltd. Controlled by Sinopharm Group
Sinopharm Medical Instrument (Hainan) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Guangxi Medical Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Runhe Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Anhui Chuzhou Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Anhui Pharmaceutical Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changxing Professional Pharmacy (Haikou) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Special Drugs Shihezi Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Medical Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Device (Guangdong) Medical Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Anhui Huaning Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Changsha Gaoxin Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. Controlled by Sinopharm Group
Liaoning Pilot Free Trade Zone China Medical Device Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Langfang Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang (Langfang) Pharmaceutical Trade Co., Ltd. Controlled by Sinopharm Group
Shanghai International Pharmaceutical Trade Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Guizhou Yitong Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Zhuanye Pharmacy (Dongfang) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Xingtai Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Handan Sinopharm Lerentang Pharmacy Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Kangfu (Tengzhou) Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
348
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Sinopharm Holding Xinye (Hubei) Medicine Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Shanxi Hejin Pharmaceutical Co., Ltd. Controlled by Sinopharm Group
Shanghai Guoda Shengxin Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Baise Device Co., Ltd. Controlled by Sinopharm Group
Sinopharm Shengshi (Guangdong) Medical Technology Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Tangshan Pharmacy Chain Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Cangzhou Pharmaceutical Trading Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Baoding Trading Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holdings Professional Pharmacy Chain (Hainan) Co., Ltd. Controlled by Sinopharm Group
Sinopharm Holding Benxi Co., Ltd. Controlled by Sinopharm Group
Shanghai Guodaai Pharmacy Co., Ltd. Controlled by Sinopharm Group
Sinopharm Lerentang Zhangjiakou Pharmaceutical Trading Co., Ltd. Controlled by Sinopharm Group
X
Sinopharm Holding Chuangke Yuanzhe Medical Technology (Shanghai) Co.,
Ltd. N Associate of Sinopharm Group
Sinopharm Holding Chuangke Medical Technology (Guangxi) Co., Ltd. Associate of Sinopharm Group
Yichang Humanwell Pharmaceutical Co., Ltd. Associate of Sinopharm Group
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. Associate of Sinopharm Group
Shanghai Guoda Lingyun Pharmacy Co., Ltd. Associate of Sinopharm Group
Sinopharm Nutraceuticals (Shanghai) Co., Ltd. Associate of Sinopharm Group
Sinopharm Holding (China) Financing Lease Co., Ltd. Associate of Sinopharm Group
Sinopharm Health Online Co., Ltd. Associate of Sinopharm Group
Anhui Yuguo Tianhong Health Industry Development Co., Ltd. Associate of Sinopharm Group
A partnership in which an associate of
Sinopharm Group acts as executive
Gongqingcheng Qixin partner
Subsidiary of Main Luck
Shenzhen Wanwei Medicine Trading Co., Ltd. Pharmaceutical
Chongqing Yaoyou Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Sichuan Hexin Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Guilin Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Chaohui Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Tibet Yaoyou Medicines Co., Ltd. Subsidiary of Fosun Pharm
Shenyang Hongqi Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Transfusion Technology Co., Ltd. Subsidiary of Fosun Pharm
Suzhou Laishi Transfusion Equipment Co., Ltd. Subsidiary of Fosun Pharm
Chindex Shanghai International Trading Co., Ltd. Subsidiary of Fosun Pharm
Shanghai Henlius Biopharmaceuticals Co., Ltd. Subsidiary of Fosun Pharm
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. Subsidiary of Fosun Pharm
349
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Chongqing Haisiman Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Jinzhou Avanc Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Dalian Aleph Biomedical Co., Ltd. Subsidiary of Fosun Pharm
Hunan Dongting Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Chancheng Central Hospital of Foshan City Subsidiary of Fosun Pharm
Foshan Chanyixing Medicine Development Co., Ltd. Subsidiary of Fosun Pharm
Foshan Chancheng Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Jiangsu Huanghe Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Suzhou Erye Pharmaceutical Limited Company Subsidiary of Fosun Pharm
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. Subsidiary of Fosun Pharm
Shenzhen Chindex Medical Beauty Clinic Subsidiary of Fosun Pharm
Shenzhen Hengsheng Hospital Subsidiary of Fosun Pharm
Jinzhou Avanc Medicine Co., Ltd. Subsidiary of Fosun Pharm
Jiangxi Erye Medicine Marketing Co., Ltd. Subsidiary of Fosun Pharm
Foshan Shunde Lecong Supply and Marketing Group Shunketang
Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Glaxosmithkline Pharmaceuticals (Suzhou) Co., Ltd. Subsidiary of Fosun Pharm
Hunan Yaoyou Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Shandong Skyway Pharmaceutical Sales Co., Ltd. Subsidiary of Fosun Pharm
Foshan Chanyun Medical Clinic Co., Ltd. Subsidiary of Fosun Pharm
Chengdu List Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Fresenius Kabi(Wuhan)Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Fosun Kite Biotechnology Co., Ltd. Subsidiary of Fosun Pharm
Shenzhen Xinsheng Pharmaceutical Co., Ltd. Subsidiary of Fosun Pharm
Hunan Minshengtang Biotechnology Co., Ltd. Minority shareholders of a subsidiary
Taishan Qunkang Pharmacy Co., Ltd. Minority shareholders of a subsidiary
Shenzhen Jiufeng Investment Co., Ltd. Minority shareholders of a subsidiary
Shenyang Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Huang Lijin Minority shareholders of a subsidiary
Zhang Zhenfang Minority shareholders of a subsidiary
Pingdingshan Pusheng Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Lerentang Investment Group Co., Ltd. Minority shareholders of a subsidiary
Guangdong Jiyuantang Development Co., Ltd. Minority shareholders of a subsidiary
Shanghai Baizhong Business Development (Group) Co., Ltd. Minority shareholders of a subsidiary
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
Pu'er Songmao Medicine Group Co., Ltd. Minority shareholders of a subsidiary
350
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Jilin Province Yihe Investment Consulting Co., Ltd. Minority shareholders of a subsidiary
Zhang Haiyan Minority shareholders of a subsidiary
Shenyang Shengdiou Trading Co., Ltd. Minority shareholders of a subsidiary
Xiong Xinyuan Minority shareholders of a subsidiary
Du Longfeng Minority shareholders of a subsidiary
Li Huichun Minority shareholders of a subsidiary
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Xishuangbanna Disheng Pharmaceutical Co., Ltd. Minority shareholders of a subsidiary
Companies owned by minority
Shaoguan Wujiang District Muyang Medicine Information Consultant Co., Ltd. shareholders of a subsidiary
Companies owned by minority
Taishan Xiangranhui Trade Co., Ltd. shareholders of a subsidiary
Companies owned by minority
Nanjing Yuanguang Trading Co., Ltd. shareholders of a subsidiary
Companies owned by minority
Southeast (Quanzhou) Biotechnology Pharmaceutical Co., Ltd. shareholders of a subsidiary
Family members of minority
Zhang Guitang shareholders of a subsidiary
Company owned by family member of
the non-controlling shareholder of a
Yangjiang Kangmin Pharmaceutical Co., Ltd. subsidiary
Companies with subsidiary directors,
supervisors and senior executives
Jilin Ronghe Real Estate Development Co., Ltd. serving as key management personnel
Company controlled by family member
of the director and supervisor of a
Shenzhen BeiDuo Medical Instrument Co., Ltd. subsidiary
Company invested by family member
of the director and supervisor of a
Zhongshan Kangyue Medical Instrument Co., Ltd. subsidiary
Company influenced by key managem
Jilin Tianheke Industry and Trade Co., Ltd. ent personnel of a subsidiary
The actual controller of minority
Gu Jinhua shareholders of a subsidiary
The actual controller of minority
Li Fang shareholders of a subsidiary
The actual controller of minority
Zhang Kai shareholders of a subsidiary
The actual controller of minority
Zhang Xiurong shareholders of a subsidiary
Major investor of minority
Wang Yixuan shareholders of a subsidiary
Family members of the actual
controller of minority shareholders of a
Wang Yang subsidiary
Family members of the actual
controller of minority shareholders of a
Zhang Yechuan subsidiary
Company owned by family member of
the actual controller of the non-
Guangzhou Tianren Pharmaceutical Co., Ltd. controlling shareholder of a subsidiary
Naton Biotechnology (Beijing) Co., Ltd. Subsidiary of Naton
Family members of key management
Zhao Xiaoxiao personnel of a subsidiary
351
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
4. Other related parties (Continued)
Related party relationships
Family members of key management
Zheng Jing personnel of a subsidiary
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
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Sub Marketing Center Co., Ltd. 105,193.32 116,475.39
China National Medicines Co., Ltd. 75,120.40 69,306.11
Sinopharm Holding Shanxi Co., Ltd. 57,486.89 56,979.32
Sinopharm Lerentang Medicine Co., Ltd. 47,262.61 36,319.31
Sinopharm Holding Shenyang Co., Ltd. 43,940.83 24,967.28
Sinopharm Holding Shanxi Co., Ltd. 39,620.68 34,396.29
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 29,213.63 17,009.44
Sinopharm Group 25,198.88 24,867.54
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 16,339.68 21,735.03
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. 15,635.10 13,607.70
Lanzhou Biotechnology Development Co., Ltd. 13,396.92 9,978.06
Sinopharm Holding Yangzhou Co., Ltd. 10,118.95 8,083.31
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 9,624.90 7,148.02
Sinopharm Holding Inner Mongolia Co., Ltd. 8,637.86 7,990.70
Chongqing Yaoyou Pharmaceutical Co., Ltd. 8,222.59 5,565.85
Sinopharm Holding Lunan Co., Ltd. 7,526.46 5,572.89
Shanghai Henlius Biopharmaceuticals Co., Ltd. 6,970.39 563.37
Sinopharm Holding Jilin Co., Ltd. 6,581.43 2,766.59
Sinopharm Yixin Pharmaceutical Co., Ltd. 5,973.14 5,173.14
Chongqing Taiji Group TongJunGe Pharmaceutical Co. Ltd. 5,505.03 -
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 5,409.05 801.63
Foshan Winteam Pharmaceutical Group Ltd. 5,260.50 3,266.37
China National Pharmaceutical Foreign Trade Corporation 5,206.42 4,861.79
Main Luck Pharmaceutical 5,091.78 3,656.32
Southwest Pharmaceutical Co., Ltd. 4,979.43 -
Sinopharm Holding Fujian Co., Ltd. 4,861.60 4,357.63
Sinopharm Holding Shandong Co., Ltd. 4,750.67 2,026.98
Sinopharm Holding Henan Co., Ltd. 4,153.97 4,649.57
Sinopharm Holding Xinjiang Xinte Shenrong Pharmaceutical Co., Ltd. 3,693.96 635.08
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 3,645.38 3,576.92
352
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
2021 2020
Sinopharm Holding Tongliao Co., Ltd. 3,552.91 1,680.74
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 3,442.91 1,422.37
Sinopharm Group Guorui Medicine Co., Ltd. 3,386.54 1,576.65
353
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Beijing Co., Ltd. 3,112.83 4,903.26
Sinopharm Holding Jiangsu Co., Ltd. 3,109.94 2,903.20
Taiji Group Chongqing Fuling Pharmaceutical Factory Co., Ltd. 2,969.26 -
China Otsuka Pharmaceutical Co., Ltd. 2,798.51 1,567.48
Zhijun Medicine 2,759.11 2,509.83
Shenzhen Wanwei Medicine Trading Co., Ltd. 2,726.10 1,716.39
Yichang Humanwell Pharmaceutical Co., Ltd. 2,643.62 1,951.36
Tibet Yaoyou Medicines Co., Ltd. 2,643.35 2,996.61
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 2,597.80 1,346.72
Chengdu Rongsheng Pharmacy Co., Ltd. 2,542.02 2,223.69
Jinzhou Avanc Pharmaceutical Co., Ltd. 2,528.70 2,100.06
Sinopharm Holding Pingdingshan Co., Ltd. 2,324.33 2,873.45
Sinopharm Lerentang Shijiazhuang Traditional Chinese Medicine Co., Ltd. 2,299.66 2,058.27
Sinopharm Holding Changzhou Co., Ltd. 2,282.14 2,179.64
Sinopharm Holding Xiamen Co., Ltd. 2,279.99 1,697.94
Sinopharm Holding Hunan Co., Ltd. 2,218.79 1,838.47
Sinopharm Group Guangdong Medicine Device Co., Ltd. 1,989.11 -
Sinopharm Holding Anshan Co., Ltd. 1,957.34 402.69
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. 1,917.95 585.58
Zhijun Pingshan 1,916.81 2,577.30
Yunnan Sinopharm Holding Dongchang Medicine Co., Ltd. 1,861.51 360.27
Shanghai Chaohui Pharmaceutical Co., Ltd. 1,811.15 1,036.58
Sinopharm Holding Jinzhou Co., Ltd. 1,714.96 898.18
Sinopharm Holding Ningxia Co., Ltd. 1,712.02 1,984.45
Jiangxi Erye Medicine Marketing Co., Ltd. 1,582.98 1,291.91
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 1,406.71 387.09
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 1,368.69 190.04
Sinopharm Group Shanxi Medical Devices Co., Ltd. 1,221.59 1,034.85
Sinopharm Group Medicine Logistic Co., Ltd. 1,218.05 1,571.15
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. 1,053.63 908.37
Sinopharm Health Online Co., Ltd. 1,035.69 1,680.69
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. 1,005.57 567.27
Sinopharm Holding Jinan Co., Ltd. 995.32 616.52
Shanghai Shangsheng Biological Products Co., Ltd. 927.82 445.47
354
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. 911.34 1,332.95
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. 905.89 596.39
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. 820.79 734.88
Shanghai International Pharmaceutical Trade Co., Ltd. 788.50 802.81
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. 657.33 856.06
Sinopharm Holding Wuxi Co., Ltd. 628.69 1,062.30
Sichuan Hexin Pharmaceutical Co., Ltd. 617.82 492.08
Sinopharm Holding Hulun Buir Co., Ltd. 616.53 302.77
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 577.92 414.76
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 573.19 302.56
Sinopharm Holding Tianjin Co., Ltd. 564.68 589.61
Sinopharm Holding Heilongjiang Co., Ltd. 527.17 476.53
Sinopharm Holding Hubei Co., Ltd. 527.01 6,392.07
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 504.47 628.78
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. 469.86 120.37
Zhejiang Dongfang Pharmaceutical Co., Ltd. 459.60 -
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. 441.39 540.12
Hunan Dongting Pharmaceutical Co., Ltd. 427.01 356.83
Sinopharm Holdings Beijing Huahong co., Ltd. 424.43 325.33
Sinopharm ChuanKang Pharmaceutical Co., Ltd. 420.55 336.98
China National Pharmaceutical Industry Co., Ltd. 417.96 358.00
Sinopharm Wuhan Blood Products Co., Ltd. 393.93 709.11
Sinopharm Holding Chuangke Medical Technology (Guangxi) Co., Ltd. 374.18 79.65
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. 373.83 -0.06
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. 351.72 65.08
Sinopharm Holding Dalian Co., Ltd. 340.47 282.55
Suzhou Erye Pharmaceutical Limited Company 336.71 383.55
Sinopharm Holding Yunnan Co., Ltd. 315.70 39.87
Sinopharm Holding Benxi Co., Ltd. 301.41 -
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 295.10 533.64
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. 294.42 5,518.30
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. 286.72 570.69
China National Medical Device Co., Ltd. 286.70 272.34
Sinopharm Group Southwest Medicine Co., Ltd. 275.37 96.63
355
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. 270.43 122.61
Shanghai Tongyu Information Technology Co., Ltd. 260.69 201.52
Sinopharm Holding Yancheng Co., Ltd. 251.57 298.37
Taiji Group Co., Ltd. 227.73 -
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 226.31 473.14
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. 225.09 69.17
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. 222.11 139.55
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 221.53 269.68
Huayi Pharmaceutical Co., Ltd. 214.81 78.20
Sinopharm Weiqida Pharmaceutical Co., Ltd. 204.43 164.00
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 200.75 328.28
China National Pharmaceutical Group Shanxi Rfl Pharmaceutical Co., Ltd. 197.04 -
Sinopharm Liaoning Medical Equipment Co., Ltd. 196.22 435.68
Sinopharm Holding Anhui Huaning Medicine Co., Ltd. 191.32 251.08
Chengdu Institute of Biological Products Co., Ltd. 187.49 137.27
Yangjiang Kangmin Pharmaceutical Co., Ltd. 183.84 -
Sinopharm Holding Fuzhou Co., Ltd. 182.31 469.79
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. 178.76 580.83
Glaxosmithkline Pharmaceuticals (Suzhou) Co., Ltd. 176.44 657.03
Sinopharm Holding Xinjiang Special Drugs Kashgar Pharmaceutical Co., Ltd. 176.00 114.10
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. 156.34 185.51
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. 154.85 132.54
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. 144.52 246.52
Shanghai Transfusion Technology Co., Ltd. 133.54 97.93
Sinopharm Holding Special Drugs Shihezi Pharmaceutical Co., Ltd. 129.35 79.39
Wuhan Zhongsheng Yujin Biomedical Co., Ltd. 128.33 -
Jinzhou Avanc Medicine Co., Ltd. 125.87 795.28
Sinopharm In Inner Mongolia Medical Instrument Co., Ltd. 122.47 -
Sinopharm Holding Quanzhou Co., Ltd. 107.81 279.53
Sinopharm Holding Taizhou Co., Ltd. 104.93 5.56
Fosun Kite Biotechnology Co., Ltd. 104.69 -
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. 103.59 108.17
Shanghai Merro Pharmaceutical Co., Ltd. 97.34 143.83
Shenzhen BeiDuo Medical Instrument Co., Ltd. 95.29 -
356
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Xinjiang Pharmaceutical Co., Ltd. 94.50 58.04
Sinopharm Holding Hainan Co., Ltd. 90.57 11.86
Sinopharm Holding Bayannur Co., Ltd. 89.64 92.15
Shenyang Hongqi Pharmaceutical Co., Ltd. 85.57 58.10
Gansu Tianshui Zhangjiachuan Donkey-hide Gelatin Factory 81.17 -
Sinopharm Holding Putian Co., Ltd. 78.87 81.92
Guilin Pharmaceutical Co., Ltd. 78.51 77.62
Sinopharm Holding Zhejiang Co., Ltd. 72.20 44.11
Sinopharm Holding Nantong Co., Ltd. 70.12 -
Taiji Group Chongqing No.2 Traditional Chinese Medicine Factory Co., Ltd. 68.34 -
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. 67.08 101.91
Sinopharm Holding Nanping Newforce Co., Ltd. 65.31 27.21
Sinopharm Holding Pu'er Co., Ltd. 64.21 71.28
Sinopharm Holding Chifeng Co., Ltd. 60.20 39.74
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 59.26 57.35
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. 52.64 6.60
Shantou Jinshi Powder Injection Co., Ltd. 51.36 128.40
Sichuan Jiangyou Zhongba Aconiti Science and Technology Development Co.,
36.79 -
Ltd.
Fresenius Kabi(Wuhan)Pharmaceutical Co., Ltd. 35.99 -
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. 34.40 -
Sinopharm Holding Changsha Co., Ltd. 32.69 202.34
Sinopharm Holding Hainan Hongyi Co., Ltd. 31.14 1.70
Sinopharm Foreign Trade (Beijing) Co., Ltd. 31.06 593.03
Sinopharm Holding Anhui Co., Ltd. 27.23 244.99
Sinophanm Medicine HckLing (Hubei) Essential Drug Co., Ltd. 26.07 -
Sinopharm Sichuan Pharmaceutical Co., Ltd. 25.39 14.46
Sinopharm Sanyi Medicine (Wuhu) Co., Ltd. 25.32 5.17
Sinopharm Group Medical Management Co., Ltd. 24.79 -
Sinopharm Holding Xinye (Hubei) Medicine Co., Ltd. 23.29 8.48
Guangzhou Tianren Pharmaceutical Co., Ltd. 19.64 -
Sinopharm Holding Hunan Pharmaceutical Development Co., Ltd. 19.60 23.20
Sinopharm Holding Xinte Yili Pharmaceutical Co., Ltd. 19.37 -
Taiji Group Sichuan Mianyang Pharmaceutical Co., Ltd. 18.82 -
Sinopharm Holding Changsha Gaoxin Medicine Co., Ltd. 16.66 5.63
357
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Hunan Yaoyou Pharmaceutical Co., Ltd. 13.12 -
Chongqing Tianjiang Yifang Pharmaceutical Co., Ltd. 11.01 -
Sinopharm Holding Changde Co., Ltd. 10.92 25.05
Sinopharm Holding Longyan Co., Ltd. 10.16 17.32
Guorun medical 9.25 4.91
Sinopharm Holding Jiangxi Co., Ltd. 7.98 2.82
Sinopharm Group Linfen Co., Ltd. 7.07 63.46
Sinopharm Holding Yangzhou Biological Products Co., Ltd. 6.79 19.11
Chongqing Tongjunge Co., Ltd. 6.40 -
Jiangsu Huanghe Pharmaceutical Co., Ltd. 6.12 -
Shandong Skyway Pharmaceutical Sales Co., Ltd. 6.10 -
Sinopharm Holdings Kunming Co., Ltd. 5.84 -
Taiji Group Sichuan Nanchong Pharmaceutical Co., Ltd. 5.56 -
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. 4.61 91.42
Sinopharm ChangChun A-THINK Pharmaceutical Co., Ltd. 4.21 -
Shyndec Pharma 3.62 2,092.34
Sinopharm Holding Ordos Co., Ltd. 3.50 -
Sinopharm Chemical Reagent Co., Ltd. 3.29 -
Sinopharm Group Lingshang Hospital Management Services (Shanghai) Co.,
2.65 5.30
Ltd.
China National Medical Device (Hui Zhou) Co., Ltd. 2.03 0.08
Sinopharm Holding Dalian Hecheng Co., Ltd. 1.92 6.65
Sinopharm Wuhan Zhonglian Siyao Pharmaceutical Co., Ltd. 1.78 28.30
Chongqing Haisiman Pharmaceutical Co., Ltd. 1.63 1.28
Sinopharm Holding Linyi Medical Device Co., Ltd. 1.58 63.38
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 0.90 2.26
Sinopharm Holdings Kangfu (Tengzhou) Pharmaceutical Co., Ltd. 0.75 -
Sinopharm Device (Guangdong) Medical Technology Co., Ltd. 0.66 13.33
Sinopharm Liaoning Medical Equipment Distribution Co., Ltd. 0.44 -
Xinjiang Baitong Property Service Co., Ltd. 0.40 -
Sinopharm Holding Zhangzhou Co., Ltd. 0.28 7.97
Suzhou Laishi Transfusion Equipment Co., Ltd. 0.20 -
Zhongshan Kangyue Medical Instrument Co., Ltd. 0.02 -
Naton Biotechnology (Beijing) Co., Ltd. 0.01 -
Sinopharm Shenzhen Medicine Device Co., Ltd. - 468.95
358
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Shanghai Zeno Biotechnology Co., Ltd. - 442.48
Sinopharm Holding Hubei Guoda Pharmacy Co., Ltd. - 374.92
China National Scientific Instruments & Materials I&E Shenzhen Co., Ltd. - 371.98
Sinopharm Holding Chongqing Co., Ltd. - 310.62
Sinopharm Medical Instrument (Hainan) Co., Ltd. - 210.97
Sinopharm Group Guangxi Medical Device Co., Ltd. - 163.72
Sinopharm Holding Wuhan Hongshen Medicine Co., Ltd. - 141.59
Sinopharm United Medical Device Co., Ltd. - 132.80
Sinopharm (Dalian) Medical Device Co., Ltd. - 96.20
Sinopharm Holding Chuangke Yuanzhe Medical Technology (Shanghai) Co.,
- 67.26
Ltd.
Sinopharm Hebei Medical Instrument Co., Ltd. - 60.74
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. - 60.50
Pu'er Songmao Medicine Group Co., Ltd. - 53.81
Sinopharm Holding Shanxi Jinzhong Co., Ltd. - 47.94
Sinopharm Group Shanghai Medicine Device Co., Ltd. - 32.72
Sinopharm Holding Rizhao Co., Ltd. - 30.08
Liaoning Pilot Free Trade Zone China Medical Device Technology Co., Ltd. - 26.02
Chengdu List Pharmaceutical Co., Ltd. - 20.48
Fujian Tianjiang Pharmaceutical Co., Ltd. - 18.01
Sinopharm Holding Baotou Co., Ltd. - 16.08
Sinopharm Holding Dezhou Co., Ltd. - 10.87
Sinopharm Pharmaceutical Logistics Co., Ltd. - 9.36
Sinopharm Holding Shanxi Runhe Medicine Co., Ltd. - 9.32
Sinopharm Group Med-Tech Co., Ltd. - 9.29
Sinopharm Group Shanxi Co., Ltd. - 8.58
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. - 7.16
Sinopharm Holding Hengyang Co., Ltd. - 2.53
Sinopharm Medical Instrument (Foshan) Co., Ltd. - 1.63
China Medical Equipment Shandong Co., Ltd. - 1.44
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
Sinopharm Holding Shanxi Jincheng Co., Ltd. - 0.02
359
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Lianyungang Co., Ltd. - -1.46
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. - -19.18
687,768.64 592,449.98
360
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Group 24,407.66 24,734.75
Foshan Chancheng Pharmaceutical Co., Ltd. 14,506.37 10,915.86
Shanghai Beiyi 10,690.60 12,490.44
Sinopharm Holding Hainan Co., Ltd. 10,414.17 12,961.48
Sinopharm Lerentang Medicine Co., Ltd. 6,188.55 4,950.04
Sinopharm Holding Hainan Hongyi Co., Ltd. 4,163.99 3,268.53
Handan Sinopharm Lerentang Pharmacy Chain Co., Ltd. 3,831.87 319.70
Sinopharm Holding Beijing Co., Ltd. 3,502.16 3,168.71
Sinopharm Holding Wenzhou Co., Ltd. 3,193.71 3,055.11
Shenzhen Hengsheng Hospital 2,896.32 2,413.30
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 2,798.31 2,424.69
Sinopharm Holding Shandong Co., Ltd. 2,602.21 1,462.22
Chancheng Central Hospital of Foshan City 2,533.17 1,716.46
Sinopharm Holding Henan Co., Ltd. 2,316.89 1,974.34
Sinopharm Holdings Beijing Huahong co., Ltd. 1,702.12 1,234.14
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 1,672.26 2,084.80
Sinopharm Holding Jinzhou Co., Ltd. 1,447.50 443.29
Sinopharm Holding Nantong Co., Ltd. 1,351.27 1,551.25
Sinopharm Holding Shanxi Co., Ltd. 1,333.94 522.51
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 1,263.66 593.43
Sinopharm Holding Sub Marketing Center Co., Ltd. 1,187.63 1,281.24
China National Medicines Co., Ltd. 1,158.95 1,181.02
Sinopharm Holding Hubei Co., Ltd. 1,122.97 2,444.36
Sinopharm Holding Shanxi Co., Ltd. 1,076.97 752.39
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical Co., Ltd. 1,056.65 1,081.34
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)
2021 2020
(RMB’0,000) (RMB’0,000)
361
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
Guangzhou Tianren Pharmaceutical Co., Ltd. 1,051.64 -
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 1,033.34 608.95
Sinopharm Holding Yangzhou Co., Ltd. 880.82 711.82
Sinopharm Lerentang Tangshan Medicine Co., Ltd. 840.96 318.05
Foshan Chanyixing Medicine Development Co., Ltd. 821.85 893.27
Sinopharm Lerentang (Langfang) Pharmaceutical Trade Co., Ltd. 729.45 185.55
Shanghai Merro Pharmaceutical Co., Ltd. 728.50 652.08
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. 642.79 424.06
Sinopharm Sichuan Pharmaceutical Co., Ltd. 590.47 959.21
Sinopharm Lerentang Baoding Trading Co., Ltd. 586.09 174.02
Sinopharm Holding Jilin Co., Ltd. 584.88 267.75
Sinopharm Lerentang Xingtai Pharmaceutical Co., Ltd. 580.79 1,792.10
Sinopharm Holding Tianjin Co., Ltd. 580.03 345.76
Sinopharm Group Medicine Logistic Co., Ltd. 560.22 548.23
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 539.69 212.30
Sinopharm Holding Yunnan Co., Ltd. 506.24 303.64
Sinopharm Holding Hunan Co., Ltd. 504.86 391.44
Sinopharm Holding Jiangxi Co., Ltd. 422.59 135.52
Sinopharm Holding Anhui Co., Ltd. 409.26 412.03
Sinopharm Lerentang Baoding Hongkang Pharmaceutical Chain Co., Ltd. 407.67 508.53
Sinopharm Holding Guizhou Medical Device Co., Ltd. 403.97 154.82
Shanghai Liyi 395.47 270.43
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 362.28 402.75
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. 349.03 210.24
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. 339.19 764.13
Sinopharm Holding Anshan Co., Ltd. 323.09 71.89
Sinopharm Group Southwest Medicine Co., Ltd. 314.68 312.32
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 263.18 119.50
Zhijun Medicine 234.69 273.28
Sinopharm Holding Gansu Co., Ltd. 218.27 147.13
Sinopharm Holding Dalian Co., Ltd. 207.96 242.76
Sinopharm Lerentang Hengshui Medicine Co., Ltd. 200.53 180.87
Sinopharm Group Shanxi Co., Ltd. 186.71 57.25
Sinopharm Holding Xuzhou Co., Ltd. 179.10 281.24
Guangdong Jienuo 178.78 0.27
Shanghai Guoda Lingyun Pharmacy Co., Ltd. 170.28 255.97
Sinopharm Holding (Hubei) Hankou Pharmacy Co., Ltd. 169.51 -
Shanghai Guoda Shengxin Pharmacy Co., Ltd. 159.38 -
Sinopharm Holding Fujian Co., Ltd. 158.44 5,874.55
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. 149.60 238.28
Sinopharm Holding Wuxi Co., Ltd. 142.49 108.70
Sinopharm Holding Chongqing Taimin Pharmaceutical Co., Ltd. 142.06 50.63
362
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Guizhou Co., Ltd. 141.59 155.16
Sinopharm Holding Ningxia Co., Ltd. 141.00 108.03
Sinopharm Holding Tongren Co., Ltd. 130.37 59.06
Sinopharm Holding Guizhou (Zunyi) Medical Equipment Co., Ltd. 122.90 124.54
Sinopharm (Tianjin) Medical Equipment Co., Ltd. 121.61 -
Sinopharm Guangdong Medicine Device Supply Chain Co., Ltd. 111.58 19.64
Sinopharm Holding Benxi Co., Ltd. 104.64 -
Sinopharm Holding Shangqiu Co., Ltd. 103.96 112.63
Sinopharm Holding Jiangsu Co., Ltd. 102.49 148.99
Sinopharm Holding Wuhu Co., Ltd. 94.57 101.92
Shanghai Guodaai Pharmacy Co., Ltd. 90.79 -
Sinopharm Baise Device Co., Ltd. 86.38 29.59
Sinopharm Holding Anshun Co., Ltd. 81.70 110.17
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. 80.24 45.26
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 77.08 61.57
Shenzhen Chindex Medical Beauty Clinic 76.78 33.97
Sinopharm Holding Qinghai Co., Ltd. 66.50 44.40
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. 64.94 8.69
Sinopharm Lerentang Tangshan Pharmacy Chain Co., Ltd. 61.82 -
Sinopharm Holding Dalian Hecheng Co., Ltd. 59.86 12.41
Yangjiang Kangmin Pharmaceutical Co., Ltd. 59.47 -
Shanghai Shengxin Pharmacy Co., Ltd. 59.07 341.33
Sinopharm Holding Shaanxi Pharmacy Co., Ltd. 58.56 -
Sinopharm Holding Zunyi Co., Ltd. 56.04 266.50
Sinopharm Lerentang Zhangjiakou Pharmaceutical Trading Co., Ltd. 46.15 -
Sinopharm Guangxi Medical Technology Co., Ltd. 44.56 -
Sinopharm Holding Honghe Co., Ltd. 44.13 84.17
Sinopharm Lerentang Shijiazhuang Traditional Chinese Medicine Co., Ltd. 42.31 35.59
Sinopharm Lerentang Cangzhou Pharmaceutical Trading Co., Ltd. 39.64 100.27
Sinopharm Lerentang Shijiazhuang Medical Management Co., Ltd. 37.95 22.79
Sinopharm Holding Chuxiong Co., Ltd. 36.97 32.29
Sinopharm Holding Inner Mongolia Co., Ltd. 34.98 96.62
Sinopharm Holding Shenyang Co., Ltd. 34.41 3.82
363
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Group Guangxi Medical Device Co., Ltd. 34.11 31.08
Sinopharm Guangdong Medical Examination Co., Ltd. 33.47 37.63
Sinopharm Lerentang Chengde Medicine Co., Ltd. 31.75 24.83
Dalian Aleph Biomedical Co., Ltd. 29.48 -
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 29.47 32.41
Sinopharm Lerentang Xintai Medicine Co., Ltd. 27.30 41.19
Sinopharm Holding Chongqing Co., Ltd. 26.98 90.10
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. 25.39 60.69
Sinopharm Holding Tianjin North Medicine Co., Ltd. 23.80 48.29
Zhijun Trade 23.11 46.43
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. 22.56 15.37
Sinopharm Holding Jiaozuo Co., Ltd. 22.01 25.50
Sinopharm Holding Tongliao Co., Ltd. 21.80 -
Zhijun Pingshan 19.87 52.94
Sinopharm Holdings Anhui Pharmaceutical Chain Co., Ltd. 19.06 -
Foshan Chengnan Fengliaoxing Medical Hospital Co., Ltd. 17.88 18.21
Sinopharm Medical Instrument (Foshan) Co., Ltd. 16.18 -
Sinopharm Holdings Chongqing Health Management Co., Ltd. 16.00 -
Sinopharm Lerentang Handan Medicine Co., Ltd. 13.70 3.50
Sinopharm Holding Fuzhou Co., Ltd. 13.43 24.02
Sinopharm Holdings Professional Pharmacy Chain (Hainan) Co., Ltd. 13.26 -
Sinopharm Medical Instrument Guizhou Qiannan Co., Ltd. 12.95 1.63
Sinopharm Group Guangdong Medicine Device Co., Ltd. 12.53 5.88
Sinopharm Shengshi (Guangdong) Medical Technology Co., Ltd. 12.24 -
Sinopharm Holding Pingdingshan Co., Ltd. 12.11 6.05
Sinopharm Holding Longyan Co., Ltd. 12.11 9.75
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. 11.08 397.70
Shenzhen Xinsheng Pharmaceutical Co., Ltd. 9.68 -
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. 9.25 0.17
364
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Lerentang Langfang Pharmaceutical Co., Ltd. 8.88 21.33
Sinopharm Holding Qianxinan Co., Ltd. 8.79 7.09
China National Scientific Instruments & Materials I&E Shenzhen Co., Ltd. 8.32 4.92
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy Co., Ltd. 8.22 6.83
Sinopharm Lerentang Zhangjiakou Medicine Co., Ltd. 7.60 14.27
Sinopharm Holding Hubei Hongyuan Co., Ltd. 7.43 27.28
Chongqing Tongjunge Co., Ltd. 6.87 -
Sinopharm Holdings Anhui Chuzhou Pharmaceutical Co., Ltd. 6.80 -
Sinopharm Holdings Wuhan Guoda Pharmacy Chain Co., Ltd. 6.61 -
Sinopharm Lerentang Baoding Medicine Co., Ltd. 5.79 25.28
Sichuan Taiji Pharmacy Chain Co., Ltd. 5.44 -
Sinopharm Holding Putian Co., Ltd. 5.38 10.60
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. 4.00 -
Sinopharm Pharmaceutical Logistics Co., Ltd. 3.67 -
Sinopharm Holding Hongrun Medical Business Service (Shanghai) Co., Ltd. 3.11 1.81
Sinopharm Group Shanxi Medical Devices Co., Ltd. 2.91 -
Sinopharm Holding Yancheng Co., Ltd. 2.53 81.78
Sinopharm Holding Ningde Co., Ltd. 2.36 5.94
Sinopharm Holding Changzhou Co., Ltd. 2.12 18.75
Sinopharm Medicine Holding Chenzhou Co., Ltd. 2.12 -
Foshan Chanyun Medical Clinic Co., Ltd. 1.92 -
Sinopharm Holding Taizhou Co., Ltd. 1.75 9.16
Sinopharm Holding Zhuanye Pharmacy (Dongfang) Co., Ltd. 1.57 1.87
Sinopharm Holding Hunan Weian Pharmacy Medicine Chain Company Limited 1.38 -
Sinopharm Holding Changxing Professional Pharmacy (Haikou) Co., Ltd. 1.17 2.25
China Biotechnology Technology Co., Ltd. 1.14 -
Sinopharm Group Fengliaoxing Medical Hospital (Foshan Nanhai) Co., Ltd. 0.96 0.51
Sinopharm Holding Pharmacy (Shanghai) Co., Ltd. 0.80 15.18
Sinopharm Holding (Shandong) Medical Device Co., Ltd. 0.78 -
365
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Fuzhou Co., Ltd. 0.58 3.69
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 0.47 36.20
Sinopharm Instruments (Jiangmen) Co., Ltd. 0.39 -
Sinopharm Shenzhen Medicine Device Co., Ltd. 0.39 538.94
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. 0.29 4.60
Sinopharm Holding Dalian Special Drug Store Co., Ltd. 0.28 -
Sinopharm Holding Shanxi Medical Consumables Co., Ltd. 0.28 -
China National Medical Device (Hui Zhou) Co., Ltd. 0.16 -
Sinopharm Holdings Professional Pharmacy Songyuan Co., Ltd. 0.12 -
Dongyuan Accord 0.08 53.99
Sinopharm Holdings Xinyu Co., Ltd. 0.06 -
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. 0.03 -
Sinopharm Holding Quanzhou Co., Ltd. 0.01 95.96
Foshan Shunde Lecong Supply and Marketing Group Shunketang
Pharmaceutical Co., Ltd. 0.01 -
Sinopharm Zhuhai Medical Instrument Co., Ltd. - 744.62
China Sinopharm International Corporation - 300.14
Chindex Shanghai International Trading Co., Ltd. - 234.37
Foshan Chancheng District Shiwan Town Chengnan Community Health Service
Center - 54.56
Sinopharm Holding Chengdu Co., Ltd. - 26.95
Sinopharm Holding Xinye (Hubei) Medicine Co., Ltd. - 22.78
Yuxi Sinopharm Medicine Co., Ltd. - 22.61
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. - 16.99
China National Pharmaceutical Foreign Trade Corporation - 16.44
Sinopharm Hunan Prov. Medical Equipment Co., Ltd. - 14.23
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. - 4.91
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. - 4.89
Sinopharm Holding Fuzhou Medical Devices Co., Ltd. - 4.07
Guangdong Yifang Pharmaceutical Co., Ltd. - 2.71
Sinopharm Holding Kunming Pharmacy Co., Ltd. - 2.67
366
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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)
2021 2020
(RMB’0,000) (RMB’0,000)
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. - 2.53
Sinopharm Guanai Jikun Pharmacy (Haikou) Co., Ltd. - 2.45
Sinopharm Fortune Way Company - 2.38
China Otsuka Pharmaceutical Co., Ltd. - 1.61
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
Sinopharm Medical Instrument (Hainan) Co., Ltd. - 0.18
Sinopharm Holding Guizhou Medical Chain Co., Ltd. - 0.13
Sinopharm Holding Shanxi Hejin Pharmaceutical Co., Ltd. - 0.12
Sinopharm Holding Ulanqab Co., Ltd. - -0.06
Sinopharm Holding Jilin Chain Store Co., Ltd. - -1.66
Sinopharm Group Fengliaoxing Pharmacy (Foshan) Co., Ltd. - -2.65
129,881.90 124,488.24
367
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
(2) Related party transactions - leases
As the lessor
Type of Income from leases in Income from leases in
assets under 2021 (RMB‘0,000) 2020 (RMB‘0,000)
leases
Sinopharm Group Zhijun (Shenzhen)
Pharmaceutical Co., Ltd. Building 103.69 191.43
Shenzhen Zhijun Pharmaceutical Trade Co., Ltd.
Building 17.02 46.43
Sinopharm Holding Hunan Weian Pharmacy
Medicine Chain Company Limited Building 15.32 19.69
Beijing Golden Elephant Fosun Pharmaceutical Co.,
Ltd. Building 13.33 13.33
China National Medicines Co., Ltd. 5.26 6.07
Building
154.62 276.95
As the lessee
Type of Expenses from leases Expenses from leases
assets under in 2021 (RMB‘0,000) in 2020 (RMB‘0,000)
leases
Sinopharm Group Building 1,742.44 -
Beijing Golden Elephant Fosun Pharmaceutical Co.,
Ltd. Building 1,107.26 1,059.25
Lerentang Investment Group Co., Ltd. Building 809.51 638.89
Sinopharm Group Medicine Logistic Co., Ltd. Building 708.00 708.00
Sinopharm Group Medicine Logistic Co., Ltd. Equipment 750.00 750.00
Shenyang Pharmaceutical Co., Ltd. Building 697.59 714.29
Hunan Minshengtang Biotechnology Co., Ltd. Building 690.30 245.73
Sinopharm Holding Yangzhou Co., Ltd. Building 373.20 391.20
Zhang Kai Building 323.77 -
Nanjing Yuanguang Trading Co., Ltd. Building 237.87 200.43
Sinopharm Group Xinjiang Special Drugs National
Pharmaceutical Co., Ltd. Building 214.10 691.31
Guangdong Jiyuantang Development Co., Ltd. Building
191.97 190.97
Xishuangbanna Disheng Pharmaceutical Co., Ltd. Building
160.00 -
Wang Yixuan Building
121.00 -
Shaoguan Wujiang District Muyang Medicine Building
Information Consultant Co., Ltd. 101.77 98.28
Jilin Tianheke Industry and Trade Co., Ltd. Building
93.48 -
Sinopharm Holding (China) Financing Lease Co., Equipment
Ltd. 87.72 397.21
Zhang Yechuan Building 86.00 73.87
Zhang Zhenfang Building 80.50 80.50
Shenyang Shengdiou Trading Co., Ltd. Building 78.10 -
Sinopharm Group Shanghai Co., Ltd. Building 74.46 700.54
Taishan Xiangranhui Trade Co., Ltd. Building 65.71 82.15
368
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
under leases leases in 2021 leases in 2020
(RMB‘0,000) (RMB‘0,000)
Beijing Sinopharm Tianyuan Real Estate & Property Building
Management Co., Ltd. 62.86 6.94
Wang Yang Building
62.46 59.42
Sinopharm Holding Beijing Co., Ltd. Building
54.52 48.79
Li Fang Building
54.48 54.48
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. Building
51.48 25.74
Sinopharm Holding Shanxi Jincheng Co., Ltd. Building
49.43 -
Huang Lijin Building
44.10 -
Sinopharm Xinjiang Pharmaceutical Co., Ltd. Building
38.86 36.74
Gu Jinhua Building
37.55 36.06
Xiong Xinyuan Building
35.00 -
Shanghai Baizhong Business Development (Group) Building
Co., Ltd. 28.55 -
Beijing Huafang Investment Co., Ltd. Building
24.99 24.19
Sinopharm Holding Xinjiang Special Drugs Kashgar Building
Pharmaceutical Co., Ltd. 24.20 41.01
Southeast (Quanzhou) Biotechnology Building
Pharmaceutical Co., Ltd. 22.62 -
Gu Haiqun Building
20.90 18.48
Shenzhen Jiufeng Investment Co., Ltd. Building
20.00 20.00
Zhang Haiyan Building
17.14 17.14
Zheng Jing Building 15.00 -
Zhang Xiaoxiao Building 12.00 -
Sinopharm Group Zhijun (Shenzhen) Pingshan
Pharmaceutical Co., Ltd. Building 10.18 10.18
Zhang Guitang Building 9.94 -
Zhang Xiurong Building 8.80 -
Sinopharm Holding Xinjiang Xinte Karamay
Pharmaceutical Co., Ltd. Building 7.40 47.41
Taishan Qunkang Pharmacy Co., Ltd. Equipment 1.13 13.50
Xinjiang Baitong Property Service Co., Ltd. Building 0.80 -
Pingdingshan Pusheng Pharmaceutical Co., Ltd. Building - 464.17
Pu'er Songmao Medicine Group Co., Ltd. Building - 202.21
Sinopharm Group Medicine Logistic Co., Ltd.
Guangzhou Branch Equipment - 17.71
China National Medicines Co., Ltd. Building - 11.58
9,509.14 8,178.37
369
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2020.
(5) Related party transactions – borrowings and lendings
Borrowings
2021 Category Amount Inception Maturity
(RMB‘0,000)
28 January 2021
Sinopharm Group Short-term 30 December 28 April 2021
Financial Co., Ltd. borrowings 130,884.13 2021 30 March 2022
13 January 2021
Sinopharm Group Discount on bank 16 September 9 February 2021
Financial Co., Ltd. acceptance bills 87,693.77 2021 31 March 2022
Jilin Province Yihe 15 January 2021
Investment Consulting 22 November 18 June 2021
Co., Ltd. Entrusted borrowings 8,145.00 2021 24 October 2022
226,722.90
2020 Category Amount Inception Maturity
(RMB‘0,000)
21 February 2021-
Sinopharm Group Short-term 18 September 1 July 2021-
Financial Co., Ltd. borrowings 75,052.21 2021 30 January 2021
30 March 2021-
Sinopharm Group Discount on bank 25 September 25 May 2021-
Financial Co., Ltd. acceptance bills 60,820.88 2021 24 June 2021
Jilin Ronghe Real Estate Short-term 4 January 2021- 21 January 2021-
Development Co., Ltd. borrowings 10,400.00 20 February 2021 1 May 2021
Jilin Province Yihe
Investment Consulting Short-term 16 May 2021- 23 January 2021-
Co., Ltd. borrowings 5,670.00 23 November 2021 22 June 2021
Short-term 1 January 2021- 31 March 2021-
Sinopharm Group borrowings 5,600.00 1 February 2021 30 April 2021
Long-term
CNPGC borrowings 3,160.00 30 July 2021 30 July 2023
160,703.09
370
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 2020
(RMB‘0,000) (RMB‘0,000)
Shanghai Tongyu Information
Technology Co., Ltd. Purchase of an intangible asset 161.21 165.48
Shanghai Tongyu Information
Technology Co., Ltd. Purchase of a fixed asset 15.78 27.98
176.99 193.46
(7) Other related party transactions
Remuneration for key management personnel
2021 2020
(RMB‘0,000) (RMB‘0,000)
1,347.92 1,656.25
Interest expense
Category 2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group Financial Co., Ltd. Payment of loan interest 1,312.97 788.29
Payment of discount interest on
Sinopharm Group Financial Co., Ltd.
notes 843.07 632.17
CNGCC Payment of entrusted loan interest 123.35 103.77
Jilin Province Yihe Investment
Consulting Co., Ltd. Payment of entrusted loan interest 116.84 49.92
Jilin Ronghe Real Estate Development
Co., Ltd. Payment of entrusted loan interest - 335.84
Sinopharm Group Payment of short term loan interest - 103.60
2,396.23 2,013.59
Interest income
Category 2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group Finance Co., Ltd. Deposit interest income 22.15 9.11
22.15 9.11
371
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
5. Major transactions between the Group and its related parties (Continued)
Related party fund investment
Category 2021
(RMB‘0,000)
Gongqingcheng Qixin Fund investment 1,800.00
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 RMB
684,872.51 (2020: RMB588,714.37).
(b) During the current year, the related parties rendered services to the Group at the market price amounting to
RMB2,896.13 (2020: RMB3,735.61).
(c) During the current year, the Group sold goods to related parties at the market price amounting to RMB127,485.88
(2020: RMB122,451.32).
(d) During the current year, the Group rendered services to related parties at the market price amounting to
RMB2,396.02 (2020: RMB2,036.92).
(2) Related party transactions - leases
(a) During the current year, the Group leased buildings and equipment to related parties and recognised income of
RMB154.62 (2020: RMB276.95) according to the agreements.
(b) During the current year, the Group leased buildings and equipment from related parties and an expense of
RMB9,509.14 (2020: RMB8,178.37) was incurred according to the lease.
(3) 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 2020.
(4) Related party transactions - borrowings
(a) During the current year, the Group borrowed RMB226,722.90 at annual interest rates ranging from 2.40% to 3.90%
from related parties (2020: RMB160,703.09 at rates ranging from 2.40% to 4.79%).
(b) During the current year, the Group has not lent capital to related parties (2020: nil).
(5) 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 RMB176.99 (2020: RMB193.46).
(b) During the current year, the Group has not sold any long-term assets to related parties (2020: nil).
(6) 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 RMB1,347.92 (2020: RMB1,656.25).
(b) During the current year, the Group has paid borrowing interest, entrusted loan interest, etc. to related parties in the
amount of RMB2,396.23 (2020: RMB2,013.59)
(c) During the current year, the Group has received deposit interest from related parties in the amount of RMB22.15
(2020: RMB9.11).
(d) During the current year, at the 1st Meeting of the 9th board of directors which held on 16 July 2021, the Group
deliberated and passed the proposal on investment subscription of the Industry Fund (Phase II) and related party
transaction of the Group. As a limited partner of Industry Fund (Phase II), the Group intends to invest and subscribe
for the share of Industry Fund (Phase II) amounted to RMB60 million, which shall be paid in 3 instalments.
Gongqingcheng Qixin is the entity of the Industry Fund. The Group has made first payment RMB18 millions on
August 2021. As at 31 December 2021, the Group has made payments of RMB18 million. As at 31 December 2021,
the Group has made payment of RMB18 million totally.
372
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
6. Commitments between the Group and related parties
As lessee
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Yangzhou Co., Ltd. 1,492.82 1,956.00
Shenyang Pharmaceutical Co., Ltd. 1,002.36 297.62
Shaoguan Wujiang District Muyang Medicine Information Consultant Co., Ltd. 669.96 771.72
Zhang Yechuan
557.90 577.72
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd.
346.02 397.49
Wang Yixuan
316.00 -
Xiong Xinyuan
310.50 -
Zhangkai
283.77 -
Nanjing Yuanguang Trading Co., Ltd.
207.40 57.15
Shenyang Shengdiou Trading Co., Ltd.
196.19 -
Lerentang Investment Group Co., Ltd.
188.36 1,017.87
Li Fang
163.44 217.92
Sinopharm Holding Beijing Co., Ltd.
128.10 12.38
Beijing Sinopharm Tianyuan Real Estate & Property Management Co., Ltd.
100.00 162.86
Guangdong Jiyuantang Development Co., Ltd.
99.51 318.01
Sinopharm Holding Shanxi Jincheng Co., Ltd.
69.99 -
Wang Yang
62.46 -
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd.
52.49 -
Shenzhen Jiufeng Investment Co., Ltd.
40.00 16.67
Zhang Haiyan
36.58 53.72
Sinopharm Holding (China) Financing Lease Co., Ltd.
33.81 87.06
Sinopharm Group Zhijun (Shenzhen) Pingshan Pharmaceutical Co., Ltd.
26.31 36.49
Gu Haiqun
23.78 44.69
Zhang Guitang
19.06 -
Gu Jinhua
15.65 37.86
Beijing Huafang Investment Co., Ltd.
9.60 34.59
Hunan Minshengtang Biotechnology Co., Ltd.
- 109.76
Taishan Xiangranhui Trade Co., Ltd.
- 84.39
Zhang Zhenfang
- 80.50
Sinopharm Xinjiang Pharmaceutical Co., Ltd.
- 77.71
Pu'er Songmao Medicine Group Co., Ltd.
- 3.73
Taishan Qunkang Pharmacy Co., Ltd. - 1.13
6,452.06 6,455.04
373
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
6. Commitments between the Group and related parties (Continued)
As lessor
2021 2020
(RMB‘0,000) (RMB‘0,000)
China National Medicines Co., Ltd. 5.63 -
Beijing Golden Elephant Fosun Pharmaceutical Co.,
Ltd. - 26.67
Sinopharm Holding Hunan Weian Pharmacy
Medicine Chain Company Limited - 18.72
5.63 45.39
As investor
Contracted
amount not Shareholding
of the Group Investee companies yet paid Signed Day Price Match ratio
Sinopharm Gongqingcheng 42,000,000.00 60,000,000.00
2021/7/16 2.93%
Accord Qixin
374
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties
Accounts receivable
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision
bad debts for bad
debts
Foshan Chancheng Pharmaceutical Co., Ltd. 6,547.86 46.25 5,045.71 33.12
Sinopharm Group 4,728.11 - 5,104.47 -
Sinopharm Lerentang Medicine Co., Ltd. 1,289.89 - 1,133.99 -
Sinopharm Health Online Co., Ltd. 1,019.94 - 596.16 -
Shanghai Beiyi Guoda Pharmaceutical Co., Ltd. 1,010.77 - 2,606.65 -
Chancheng Central Hospital of Foshan City 951.26 7.31 619.99 3.90
Sinopharm Holding Hainan Co., Ltd. 723.15 - 926.32 -
Sinopharm Holding Hainan Hongyi Co., Ltd. 640.85 - 534.71 -
Handan Sinopharm Lerentang Pharmacy Chain Co., Ltd. 635.01 - 83.24 -
Shenzhen Hengsheng Hospital 597.05 - 537.70 -
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 519.94 - 439.73 -
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 481.69 - 438.06 -
Sinopharm Lerentang Baoding Hongkang Pharmaceutical
Chain Co., Ltd. 436.33 - 346.42 -
Sinopharm Holding Wenzhou Co., Ltd. 334.06 - 314.26 -
Sinopharm Holding Beijing Co., Ltd. 319.00 - 932.92 -
Sinopharm Holding Jinzhou Co., Ltd. 301.86 - 58.72 -
Shanghai Merro Pharmaceutical Co., Ltd. 276.03 - 164.80 -
Sinopharm Holding Henan Co., Ltd. 229.09 - 214.42 -
Sinopharm Lerentang Baoding Trading Co., Ltd. 211.54 - 164.53 -
Foshan Chanyixing Medicine Development Co., Ltd. 210.02 1.29 344.57 1.80
Sinopharm Group Xinjiang Special Drugs National
Pharmaceutical Co., Ltd. 191.19 - 125.75 -
Sinopharm Lerentang Tangshan Medicine Co., Ltd. 190.82 - 99.73 -
Sinopharm Holdings Beijing Huahong co., Ltd. 149.07 - 181.11 -
Sinopharm Lerentang Hebei Medical Instrument Trade Co.,
Ltd. 136.82 - 92.15 -
Sinopharm Holding Shanxi Co., Ltd. 135.68 - 77.18 -
Sinopharm Holding Shandong Co., Ltd. 128.71 - 7.61 -
Sinopharm Group (Tianjin) Eastern Bokang Pharmaceutical
Co., Ltd. 115.00 - 94.35 -
375
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Hubei Co., Ltd. 113.43 - 125.29 -
Hutchison Whampoa Sinopharm Pharmaceuticals
(Shanghai) Co., Ltd. 112.54 - 181.45 -
Sinopharm Holding Yunnan Co., Ltd. 96.75 - 13.91 -
Sinopharm Holding Yangzhou Co., Ltd. 95.36 - 109.24 -
Sinopharm Sichuan Pharmaceutical Co., Ltd. 89.22 - 143.77 -
Sinopharm Holding Hunan Co., Ltd. 84.06 - 47.63 -
Sinopharm Holding Xinjiang Special Drugs Western
Pharmaceutical Co., Ltd. 80.86 - 138.51 -
Sinopharm Lerentang (Langfang) Pharmaceutical Trade Co.,
Ltd. 72.12 - 129.43 -
Sinopharm Holding Tianjin Co., Ltd. 70.17 - 56.87 -
Sinopharm Lerentang Xingtai Pharmaceutical Co., Ltd. 69.04 - 8.22 -
Sinopharm Holding Anhui Co., Ltd. 61.28 - 7.45 -
Shanghai Guoda Shengxin Pharmacy Co., Ltd. 52.29 - - -
Sinopharm Holding Lerentang Hebei Pharmaceutical Co.,
Ltd. 44.36 - 12.01 -
Sinopharm Holding Jiangxi Co., Ltd. 42.12 - 11.47 -
Sinopharm Holding Gansu Co., Ltd. 39.46 - 1.45 -
Sinopharm Holding Dalian Co., Ltd. 37.94 - 65.79 -
Sinopharm Guangxi Medical Technology Co., Ltd. 37.06 - - -
Sinopharm Group Southwest Medicine Co., Ltd. 36.04 - 19.29 -
Sinopharm Holding Shenyang Co., Ltd. 33.22 - 0.04 -
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 31.57 - 205.00 -
Sinopharm Holding Anhui Pharmaceutical Co., Ltd. 26.94 - 22.54 -
China National Medicines Co., Ltd. 26.64 - 33.36 -
Shanghai Guoda Lingyun Pharmacy Co., Ltd. 26.48 - 66.48 -
Sinopharm Holding Nantong Co., Ltd. 25.59 - 6.22 -
Sinopharm Lerentang Zhangjiakou Pharmaceutical Trading
Co., Ltd. 24.43 - - -
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 24.28 - 16.91 -
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading
Co., Ltd. 24.11 - 106.80 -
376
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Anshan Co., Ltd. 23.19 - 8.11 -
Sinopharm Holding Fujian Co., Ltd. 21.19 - 25.83 -
Sinopharm Holding Tongren Co., Ltd. 19.87 - - -
Sinopharm Holding Shanxi Co., Ltd. 19.64 - 6.34 -
Shanghai Guodaai Pharmacy Co., Ltd. 19.61 - - -
Sinopharm Holding Sub Marketing Center Co., Ltd. 17.14 - 223.71 -
Sinopharm Group Medicine Logistic Co., Ltd. 16.97 - - -
Sinopharm Holding Jilin Co., Ltd. 16.02 - 20.86 -
Sinopharm Holding Xuzhou Co., Ltd. 14.30 - 22.74 -
Sinopharm Lerentang Cangzhou Pharmaceutical Trading
Co., Ltd. 12.87 - 47.07 -
Sinopharm Holding Ningxia Co., Ltd. 12.71 - 5.04 -
Sinopharm Holding Wuxi Co., Ltd. 12.22 - 12.99 -
Sinopharm Holding Qinghai Co., Ltd. 10.83 - 5.73 -
Sinopharm Holding Shanghai Likang Pharmaceutical Co.,
Ltd. 10.11 - 133.71 -
Sinopharm Holding Anshun Co., Ltd. 7.24 - 2.07 -
Sinopharm Lerentang Shijiazhuang Traditional Chinese
Medicine Co., Ltd. 6.57 - 6.24 -
Sinopharm Group Shanxi Co., Ltd. 6.25 - 9.49 -
Sinopharm Holding Honghe Co., Ltd. 5.67 - - -
Sinopharm Holding Zunyi Co., Ltd. 3.68 - - -
Sinopharm Holding Guizhou Co., Ltd. 3.56 - 7.96 -
Sinopharm Holdings Professional Pharmacy Chain (Hainan)
Co., Ltd. 2.88 - - -
Sinopharm Fengliaoxing Medical Hospital Co., Ltd. 2.76 0.03 1.55 0.01
Sinopharm Group Guangxi Medical Device Co., Ltd. 1.88 - - -
Shenzhen Chindex Medical Beauty Clinic 1.38 - - -
Shanghai Liyi Drug Store Co., Ltd. 1.29 - 23.77 -
Sinopharm Holding Chuxiong Co., Ltd. 1.02 - - -
377
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Jiangsu Co., Ltd. 0.61 - 13.80 -
Sinopharm Group Zhijun (Shenzhen) Pharmaceutical Co.,
Ltd. 0.46 - 4.15 -
Sinopharm Holding Hongrun Medical Business Service
(Shanghai) Co., Ltd. 0.45 - 0.56 -
Sinopharm Shengshi (Guangdong) Medical Technology
Co., Ltd. 0.39 - - -
Sinopharm Holding (Shandong) Medical Device Co., Ltd. 0.21 - - -
Sinopharm Holding Pharmacy (Shanghai) Co., Ltd. 0.20 - - -
Foshan Chengnan Fengliaoxing Medical Hospital Co., Ltd. 0.15 - 3.72 -
Sinopharm Holding Dalian Hecheng Co., Ltd. 0.07 - 1.68 -
Sinopharm Group Fengliaoxing Medical Hospital (Foshan
Nanhai) Co., Ltd. 0.01 - 0.09 -
Sinopharm Lerentang Hengshui Medicine Co., Ltd. - - 119.76 -
China National Pharmaceutical Foreign Trade Corporation - - 29.94 -
Shanghai Shengxin Pharmacy Co., Ltd. - - 21.75 -
Foshan Chancheng District Shiwan Town Chengnan
Community Health Service Center - - 16.03 0.04
Sinopharm Lerentang Langfang Pharmaceutical Co., Ltd. - - 10.24 -
Sinopharm Lerentang Shijiazhuang Medical Management
Co., Ltd. - - 7.44 -
Sinopharm Holding Tianjin North Medicine Co., Ltd. - - 6.82 -
Sinopharm Holding Yancheng Co., Ltd. - - 6.56 -
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. - - 3.91 -
Sinopharm Lerentang Xintai Medicine Co., Ltd. - - 3.42 -
Sinopharm Holding Chengdu Co., Ltd. - - 3.41 -
Sinopharm Holding Changzhou Co., Ltd. - - 1.50 -
Sinopharm Lerentang Baoding Medicine Co., Ltd. - - 1.31 -
Sinopharm Lerentang Handan Medicine Co., Ltd. - - 1.10 -
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. - - 1.03 -
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 -
378
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Accounts receivable (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision Amount Provision
for bad for bad
debts debts
Sinopharm Guanai Yuankang Pharmacy (Haikou) Co., Ltd. - - 0.23 -
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy
Co., Ltd. - - 0.15 -
Sinopharm Holding Fuzhou Co., Ltd. - - 0.01 -
24,261.50 54.88 23,637.28 38.87
379
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Notes receivable (Including receivables financing)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision Amount Provision
for bad for bad
debts debts
Sinopharm Holding Hainan Co., Ltd. 1,744.60 - 4,854.93 -
Sinopharm Holding Hainan Hongyi Co., Ltd. 108.56 - 944.57 -
Sinopharm Holding Shanxi Co., Ltd. 99.57 - 65.04 -
Sinopharm Holding Lerentang Hebei Pharmaceutical Co.,
Ltd. 46.60 - - -
Sinopharm Holding Beijing Co., Ltd. 40.49 - 279.54 -
Sinopharm Holding Benxi Co., Ltd. 35.25 - - -
Sinopharm Holding Shandong Co., Ltd. - - 135.51 -
Sinopharm Lerentang Medicine Co., Ltd. - - 90.95 -
Sinopharm Holding Zunyi Co., Ltd. - - 80.30 -
Sinopharm Holding Guizhou Yitong Medicine Co., Ltd. - - 35.75 -
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 -
2,075.07 - 6,595.39 -
380
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Other receivables
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision Amount Provision for
for bad bad debts
debts
Sinopharm Group Zhijun (Suzhou) Pharmaceutical Co.,
Ltd. 4,633.42 4,633.42 4,633.42 4,633.42
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 387.10 - - -
Sinopharm Group Medicine Logistic Co., Ltd. 144.25 - 255.98 -
Sinopharm Holding (China) Financing Lease Co., Ltd. 114.00 - 57.00 -
Shanghai Shyndec Pharmaceutical Co., Ltd. 98.39 - 98.39 -
Taiji Group Chongqing Fuling Pharmaceutical Factory Co.,
Ltd. 90.00 - - -
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. 57.77 - - -
Sinopharm Holding Sub Marketing Center Co., Ltd. 43.89 - - -
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 40.00 - 40.00 -
Guangdong Jiyuantang Development Co., Ltd. 28.33 - - -
Sinopharm (Tianjin) Medical Equipment Co., Ltd. 24.80 - - -
Sinopharm Holding Tongliao Co., Ltd. 23.10 - - -
Sinopharm Holding Inner Mongolia Co., Ltd. 14.25 - 25.65 -
Sinopharm Health Online Co., Ltd. 10.00 - - -
Sinopharm Guangxi Medical Technology Co., Ltd. 9.69 - - -
Sinopharm Guangdong Medicine Device Supply Chain Co.,
Ltd. 6.31 - 1.74 -
Southwest Pharmaceutical Co., Ltd. 5.00 - - -
Gu Jinhua 4.70 - - -
Sinopharm Group Zhijun (Shenzhen) Pingshan
Pharmaceutical Co., Ltd. 4.16 - 1.85 -
Chancheng Central Hospital of Foshan City 4.00 - - -
Zhang Haiyan 3.00 - 3.00 -
Sinopharm Holding Hunan Weian Pharmacy Medicine
Chain Company Limited 2.75 - - -
Sinopharm Holding Chuangke Medical Technology
(Guangxi) Co., Ltd. 2.00 - - -
Sinopharm Holding Huaideju Pharmaceutical (Xiamen)
Co., Ltd. 1.00 - - -
Sinopharm Shenzhen Medicine Device Co., Ltd. 0.41 - - -
Xinjiang Baitong Property Service Co., Ltd. 0.20 - 0.13 -
Sinopharm Group Guangxi Medical Device Co., Ltd. 0.19 - - -
381
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Other receivables
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision Amount Provision for
for bad bad debts
debts
Shenzhen Zhijun Pharmaceutical Trade Co., Ltd. 0.17 - 1.08 -
Jilin Ronghe Real Estate Development Co., Ltd. 0.16 - - -
China National Scientific Instruments & Materials I&E
Shenzhen Co., Ltd. 0.16 - - -
Sinopharm Group Guangdong Medicine Device Co., Ltd. 0.09 - 0.01 -
Sinopharm Shengshi (Guangdong) Medical Technology
Co., Ltd. 0.01 - - -
Du Longfeng - - 205.73 -
Li Huichun - - 205.73 -
Sinopharm Holding Fujian Co., Ltd. - - 115.83 -
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. - - 22.00 -
Sinopharm Group Zhijun (Shenzhen) Pharmaceutical Co.,
Ltd. - - 20.44 -
Sinopharm Lerentang Hebei Medical Instrument Trade Co.,
Ltd. - - 4.85 -
Sinopharm Holding Xinjiang Special Drugs Kashgar
Pharmaceutical Co., Ltd. - - 0.72 -
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. - - 0.50 0.10
5,753.30 4,633.42 5,694.05 4,633.52
382
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Advances to suppliers
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Holding Shanxi Co., Ltd. 1,970.20 - 1,774.71 -
Sinopharm Holding Shanxi Co., Ltd. 1,750.00 - - -
Southwest Pharmaceutical Co., Ltd. 353.38 - - -
Hutchison Whampoa Sinopharm Pharmaceuticals
(Shanghai) Co., Ltd. 156.86 - - -
Chongqing Taiji Group TongJunGe Pharmaceutical Co.
Ltd. 129.43 - - -
Sinopharm Holding Hubei Co., Ltd. 126.32 - - -
Nanjing Yuanguang Trading Co., Ltd. 106.04 - - -
Xishuangbanna Disheng Pharmaceutical Co., Ltd. 88.00 - - -
Sinopharm Group Guorui Medicine Co., Ltd. 73.73 - 30.78 -
Sichuan Hexin Pharmaceutical Co., Ltd. 71.05 - - -
Sinopharm Group Zhijun (Shenzhen) Pharmaceutical Co.,
Ltd. 62.64 - 4.19 -
Sinopharm Group Xinjiang Special Drugs National
Pharmaceutical Co., Ltd. 42.47 - - -
Jiangxi Erye Medicine Marketing Co., Ltd. 31.13 - - -
Chongqing Yaoyou Pharmaceutical Co., Ltd. 31.13 - 40.90 -
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 15.66 - 47.57 -
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 15.39 - 1.24 -
Fosun Kite Biotechnology Co., Ltd. 13.61 - - -
Taiji Group Co., Ltd. 12.02 - - -
Sinopharm Holding Sub Marketing Center Co., Ltd. 7.63 - 4.47 -
Sinopharm Weiqida Pharmaceutical Co., Ltd. 7.17 - - -
Sinopharm Holding Hunan Co., Ltd. 6.98 - - -
Beijing Sinopharm Tianyuan Real Estate & Property
Management Co., Ltd. 6.34 - - -
Suzhou Erye Pharmaceutical Limited Company 6.27 - 12.17 -
Sinopharm Yixin Pharmaceutical Co., Ltd. 5.89 - - -
Taiji Group Chongqing Fuling Pharmaceutical Factory Co.,
Ltd. 5.12 - - -
Sinopharm Group Southwest Medicine Co., Ltd. 2.54 - - -
Taiji Group Sichuan Nanchong Pharmaceutical Co., Ltd. 1.84 - - -
Hubei Sinopharm Zhonglian Medicine Co., Ltd. 1.35 - 1.35 -
Sinopharm Foreign Trade (Beijing) Co., Ltd. 0.93 - - -
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 0.87 - 13.73 -
Chengdu Rongsheng Pharmacy Co., Ltd. 0.54 - 21.71 -
383
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
7. Amounts due from related parties (Continued)
Advances to suppliers (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Amount Provision for Amount Provision for
bad debts bad debts
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 0.50 - 0.90 -
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. 0.47 - - -
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 0.44 - 0.01 -
Zhejiang Dongfang Pharmaceutical Co., Ltd. 0.43 - - -
Xinjiang Baitong Property Service Co., Ltd. 0.35 - - -
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. 0.34 - - -
China National Pharmaceutical Industry Co., Ltd. 0.30 - - -
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. 0.19 - 7.93 -
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. 0.07 - - -
Shanghai Shyndec Pharmaceutical Co., Ltd. 0.01 - 0.01 -
Sinopharm Group Guangxi Medical Device Co., Ltd. - - 185.00 -
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. - - 26.08 -
Lanzhou Biotechnology Development Co., Ltd. - - 18.00 -
Hunan Dongting Pharmaceutical Co., Ltd. - - 17.63 -
Guilin Pharmaceutical Co., Ltd. - - 7.46 -
Sinopharm Group - - 5.96 -
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. - - 2.88 -
Sinopharm Holding Beijing Co., Ltd. - - 1.49 -
Sinopharm Holdings Beijing Huahong co., Ltd. - - 1.10 -
Jinzhou Avanc Pharmaceutical Co., Ltd. - - 0.84 -
Sinopharm Holding Changsha Co., Ltd. - - 0.45 -
Sinopharm Device (Guangdong) Medical Technology Co.,
Ltd. - - 0.40 -
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. - - 0.14 -
Sinopharm Holding Yancheng Co., Ltd. - - 0.07 -
5,105.63 - 2,229.17 -
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.
384
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties
Accounts payable
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Sub Marketing Center Co., Ltd. 10,046.52 10,059.79
China National Medicines Co., Ltd. 5,221.30 5,351.01
Sinopharm Group 3,302.12 3,016.91
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 3,198.00 4,496.74
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 2,097.19 1,429.96
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 1,636.20 692.61
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 1,428.39 1,191.78
Sinopharm Holding Shenyang Co., Ltd. 1,416.45 1,704.48
Sinopharm Holding Xinjiang Xinte Shenrong Pharmaceutical Co., Ltd. 1,403.93 375.32
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 1,247.17 1,321.16
Sinopharm Holding Shanxi Co., Ltd. 1,084.27 870.63
Shanghai Henlius Biopharmaceuticals Co., Ltd. 1,065.67 348.94
Sinopharm Holding Inner Mongolia Co., Ltd. 998.35 276.13
Chongqing Yaoyou Pharmaceutical Co., Ltd. 964.93 331.98
Sinopharm Holding Jilin Co., Ltd. 921.67 477.47
Sinopharm Holding Yangzhou Co., Ltd. 918.64 605.68
Foshan Winteam Pharmaceutical Group Ltd. 871.35 503.23
Sinopharm Holding Fujian Co., Ltd. 865.41 530.65
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. 752.56 487.37
Sinopharm Lerentang Shijiazhuang Traditional Chinese Medicine Co., Ltd. 732.27 358.88
Lanzhou Biotechnology Development Co., Ltd. 709.02 -
Fresenius Kabi Huarui Pharmaceuticals Co., Ltd. 696.79 3,137.29
Sinopharm Holding Hubei Co., Ltd. 652.96 70.65
Main Luck Pharmaceutical 648.23 558.62
Sinopharm Yixin Pharmaceutical Co., Ltd. 641.54 522.37
Sinopharm Holding Changzhou Co., Ltd. 634.15 406.12
Sinopharm Holding Jiangsu Co., Ltd. 587.46 621.12
Shenzhen Wanwei Medicine Trading Co., Ltd. 577.71 88.40
385
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Donghong Medical (Shanghai) Co., Ltd. 505.50 18.96
China Otsuka Pharmaceutical Co., Ltd. 450.09 267.79
Sinopharm Group Shanxi Medical Devices Co., Ltd. 433.41 610.59
Sinopharm Holding Shandong Co., Ltd. 357.88 79.34
Zhijun Pingshan 345.79 385.42
Sinopharm Holding Ningxia Co., Ltd. 344.73 241.45
Yichang Humanwell Pharmaceutical Co., Ltd. 338.55 70.24
Sinopharm Holding Wuxi Co., Ltd. 320.76 83.97
Sinopharm Holding Anshan Co., Ltd. 318.63 21.05
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. 304.33 202.93
Yunnan Sinopharm Holding Dongchang Medicine Co., Ltd. 296.11 166.05
Jinzhou Avanc Pharmaceutical Co., Ltd. 287.81 497.72
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. 286.25 20.62
Tibet Yaoyou Medicines Co., Ltd. 261.01 559.97
Shanghai International Pharmaceutical Trade Co., Ltd. 254.90 214.08
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 243.13 140.45
Sinopharm Holding Hulun Buir Co., Ltd. 241.58 86.27
Sinopharm Holding Tongliao Co., Ltd. 231.44 80.23
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 222.06 134.58
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. 216.09 23.60
Sinopharm Holding Shanghai Likang Pharmaceutical Co., Ltd. 203.63 117.94
Zhijun Medicine 192.60 220.49
Sinopharm Lerentang Medicine Co., Ltd. 177.24 -
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. 176.14 119.90
Sinopharm Holding Xiamen Co., Ltd. 174.01 55.16
Sinopharm Holding Shanxi Co., Ltd. 172.94 69.89
Sinopharm Holding Jinzhou Co., Ltd. 162.03 117.69
Sinopharm Holding Pingdingshan Co., Ltd. 159.29 311.02
Sinopharm Holding Beijing Co., Ltd. 150.83 239.19
Hunan Dongting Pharmaceutical Co., Ltd. 141.65 66.74
China National Pharmaceutical Foreign Trade Corporation 139.64 126.42
Sinopharm Luya (Shandong) Pharmaceutical Co., Ltd. 121.21 172.83
Sinopharm Group Medicine Logistic Co., Ltd. 116.11 -
Jinzhou Avanc Medicine Co., Ltd. 109.92 225.15
Taiji Group Co., Ltd. 102.49 -
Sinopharm Holding Henan Co., Ltd. 101.57 320.69
386
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020
2021 (RMB‘0,00
(RMB‘0,000) 0)
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. 97.10 65.96
Southwest Pharmaceutical Co., Ltd. 94.54 -
Jiangxi Erye Medicine Marketing Co., Ltd. 94.10 13.43
Sinopharm Huixinqinyuan (Beijing) Technology Development Co., Ltd. 93.70 131.59
Sinopharm Holding Anhui Huaning Medicine Co., Ltd. 82.17 24.87
Sinopharm ChuanKang Pharmaceutical Co., Ltd. 76.39 22.81
Sinopharm Liaoning Medical Equipment Co., Ltd. 72.72 80.12
Sinopharm Holding Heilongjiang Co., Ltd. 71.93 81.13
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. 71.49 79.27
Chongqing Taiji Group TongJunGe Pharmaceutical Co. Ltd. 71.36 -
Huayi Pharmaceutical Co., Ltd. 69.71 11.02
Sinopharm Holding Yunnan Co., Ltd. 69.51 12.81
Sichuan Hexin Pharmaceutical Co., Ltd. 65.83 116.47
Sinopharm Lingyun Biopharmaceutical (Shanghai) Co., Ltd. 65.23 55.37
Taiji Group Chongqing Fuling Pharmaceutical Factory Co., Ltd. 64.99 -
Sinopharm Holdings Beijing Huahong co., Ltd. 64.93 6.83
Beijing Golden Elephant Fosun Pharmaceutical Co., Ltd. 63.95 71.46
Beijing Huasheng Pharmaceutical Biotechnology Development Co., Ltd. 62.96 27.56
Sinopharm Holding Beijing Kangchen Bio-Pharmaceutical Co., Ltd. 58.97 140.26
Shanghai Shangsheng Biological Products Co., Ltd. 57.92 19.44
Sinopharm Lerentang Qinhuangdao Pharmaceutical Trading Co., Ltd. 57.70 35.57
Sinopharm Holding Special Drugs Shihezi Pharmaceutical Co., Ltd. 55.40 12.70
Hutchison Whampoa Sinopharm Pharmaceuticals (Shanghai) Co., Ltd. 54.95 62.61
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 53.52 45.05
Taiji Group Chongqing No.2 Traditional Chinese Medicine Factory Co., Ltd. 50.62 -
Shanghai Transfusion Technology Co., Ltd. 50.30 30.18
Fujian Tianjiang Pharmaceutical Co., Ltd. 44.42 63.99
Sinopharm Holding Benxi Co., Ltd. 42.90 -
China National Pharmaceutical Industry Co., Ltd. 40.53 61.49
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 40.21 56.01
Sinopharm Advanced (Shanghai) Medical Device Co., Ltd. 39.93 0.05
Sinopharm Holding Xinjiang Special Drugs Kashgar Pharmaceutical Co., Ltd. 39.80 39.03
Sinopharm Holding Jinan Co., Ltd. 38.91 0.50
Chengdu Institute of Biological Products Co., Ltd. 37.44 37.44
Guangzhou Tianren Pharmaceutical Co., Ltd. 37.11 -
387
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020
2021 (RMB‘0,00
(RMB‘0,000) 0)
Sinopharm Holding Beijing Tianxing Puxin Biological Medical Co., Ltd. 36.92 149.57
Fresenius Kabi(Wuhan)Pharmaceutical Co., Ltd. 34.05 -
Sinopharm Holding Dalian Co., Ltd. 32.32 37.30
Sinopharm Holding Yangzhou Medical Treatment Equipment Co., Ltd. 31.92 34.77
Sinopharm Holding Nanping Newforce Co., Ltd. 31.85 -
Sinopharm In Inner Mongolia Medical Instrument Co., Ltd. 31.09 -
Sinopharm Holding Chuangke Medical Technology (Guangxi) Co., Ltd. 28.36 -
Sinopharm Holding Bayannur Co., Ltd. 28.29 6.99
Sinopharm Holding Shanxi Mingdikang Medicine Co., Ltd. 26.94 4.80
Wuhan Zhongsheng Yujin Biomedical Co., Ltd. 26.55 -
Glaxosmithkline Pharmaceuticals (Suzhou) Co., Ltd. 26.37 15.70
Jiangsu Huanghe Pharmaceutical Co., Ltd. 25.22 22.99
Sinopharm Holding Quanzhou Co., Ltd. 24.61 20.33
Sinopharm Holding Tianjin Co., Ltd. 22.98 9.51
Sichuan Jiangyou Zhongba Aconiti Science and Technology Development
Co., Ltd. 22.49 -
Suzhou Erye Pharmaceutical Limited Company 19.51 35.04
China National Pharmaceutical Group Shanxi Rfl Pharmaceutical Co., Ltd. 18.01 -
Sinopharm Holding Changsha Gaoxin Medicine Co., Ltd. 17.76 1.29
Shanghai Merro Pharmaceutical Co., Ltd. 17.46 19.67
Sinopharm Group Yibin Pharmaceuticals Co., Ltd. 16.46 28.64
Sinopharm Holding Pu'er Co., Ltd. 14.72 12.65
Chongqing Tianjiang Yifang Pharmaceutical Co., Ltd. 11.01 -
Taiji Group Sichuan Mianyang Pharmaceutical Co., Ltd. 10.98 -
Sinopharm Holding Hunan Pharmaceutical Development Co., Ltd. 10.44 10.54
Sinopharm Holding Putian Co., Ltd. 10.08 22.46
Sinopharm Xinjiang Pharmaceutical Co., Ltd. 10.07 9.48
Chengdu Rongsheng Pharmacy Co., Ltd. 10.00 10.00
Sinopharm Holding Shanghai Biomedicine Co., Ltd. 9.92 18.22
Sinopharm Shantou Jinshi Pharmaceutical Co., Ltd. 9.89 13.60
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. 9.67 5.98
Sinopharm Holding Zhejiang Co., Ltd. 8.97 3.03
Sinopharm Holding Biopharmaceutical (Tianjin) Co., Ltd. 7.73 10.69
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 7.64 0.01
Sinopharm Holding Changsha Co., Ltd. 7.63 -
Sinopharm Holding Xinte Yili Pharmaceutical Co., Ltd. 6.90 -
388
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020
2021 (RMB‘0,00
(RMB‘0,000) 0)
Sinopharm Holding Fuzhou Co., Ltd. 6.29 65.50
Shenyang Hongqi Pharmaceutical Co., Ltd. 6.28 16.60
Sinopharm Holding Yangzhou Biological Products Co., Ltd. 6.24 14.92
Zhejiang Dongfang Pharmaceutical Co., Ltd. 5.74 -
Sinopharm ChangChun A-THINK Pharmaceutical Co., Ltd. 4.75 -
Sinopharm Holding Chifeng Co., Ltd. 4.70 -
Zhongshan Kangyue Medical Instrument Co., Ltd. 4.39 -
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. 3.78 76.39
Sinopharm Group Guorui Medicine Co., Ltd. 3.60 102.96
Sinopharm Holding Changzhou Medical Logistics Center Co., Ltd. 3.39 3.29
Sinopharm Holding Dezhou Co., Ltd. 3.39 4.58
Shantou Jinshi Powder Injection Co., Ltd. 3.26 7.26
Shanghai Modern Hasen (Shangqiu) Pharmaceutical Co., Ltd. 3.17 3.10
Sinopharm Holding Hunan Co., Ltd. 2.98 40.71
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. 2.77 41.24
Sinopharm Beijing Huamiao Pharmaceutical Co., Ltd. 2.69 13.18
Sinopharm Sanyi Medicine (Wuhu) Co., Ltd. 2.38 2.66
Shandong Skyway Pharmaceutical Sales Co., Ltd. 2.32 -
Chongqing Haisiman Pharmaceutical Co., Ltd. 1.85 1.85
Sinopharm Holding Linyi Medical Device Co., Ltd. 1.77 -
Sinopharm Holding Lunan Co., Ltd. 1.66 -
Sinopharm Holding Ulanqab Co., Ltd. 1.61 3.61
Sinopharm Holding Longyan Co., Ltd. 1.54 -
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. 1.21 0.74
Sinopharm Holding Taizhou Co., Ltd. 1.16 1.76
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. 1.09 1.09
Taiji Group Sichuan Tiancheng Pharmaceutical Co., Ltd. 0.93 -
Sinopharm Holding Guizhou Yitong Medicine Co., Ltd. 0.84 -
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. 0.64 2.85
China Medical Equipment Shandong Co., Ltd. 0.62 2.98
Sinopharm Holding Anhui Co., Ltd. 0.49 -
Sinopharm Holding Nantong Co., Ltd. 0.42 -
Shanghai Chaohui Pharmaceutical Co., Ltd. 0.36 102.07
Sinopharm Shanxi Linfen Co., Ltd. 0.32 -
Changchun Changsheng Gene Pharmaceutical Co., Ltd. 0.30 0.38
Sinopharm Holding Hainan Co., Ltd. 0.19 -
389
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Accounts payable (continued)
2020
2021 (RMB‘0,00
(RMB‘0,000) 0)
Sinopharm Holding Ordos Co., Ltd. 0.18 0.18
Sinopharm Nutraceuticals (Shanghai) Co., Ltd. 0.15 0.15
Sinopharm Holding Huaideju Pharmaceutical (Xiamen) Co., Ltd. 0.11 0.22
China National Medical Device (Hui Zhou) Co., Ltd. 0.09 0.08
Guilin Pharmaceutical Co., Ltd. 0.06 0.06
Shyndec Pharma 0.06 0.06
Anhui Yuguo Tianhong Health Industry Development Co., Ltd. 0.05 -
Sinopharm Holding Liaocheng Co., Ltd. 0.02 0.02
Sinopharm Fengliaoxing (Foshan) Medicines Co., Ltd. 0.01 0.01
Sinopharm Dezhong (Foshan) Pharmaceutical Co., Ltd. 0.01 0.55
Sinopharm Group Guangxi Medical Device Co., Ltd. - 163.72
Sinopharm Holding Shanxi Jinzhong Co., Ltd. - 30.45
Sinopharm Wuhan Zhonglian Siyao Pharmaceutical Co., Ltd. - 14.72
Sinopharm Device (Guangdong) Medical Technology Co., Ltd. - 7.61
Sinopharm Holding Baotou Co., Ltd. - 1.64
Sinopharm Holding Dalian Hecheng Co., Ltd. - 0.32
Sinopharm Holding Shanxi Jincheng Co., Ltd. - 0.22
Sinopharm Holding Zhangzhou Co., Ltd. - 0.21
Chengdu List Pharmaceutical Co., Ltd. - 0.18
Sinopharm Group Shanghai Medicine Device Co., Ltd. - 0.02
56,889.51 48,542.13
390
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Notes payable
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Lerentang Medicine Co., Ltd. 22,398.88 13,351.31
Sinopharm Holding Shanxi Co., Ltd. 17,537.26 14,748.48
Sinopharm Holding Sub Marketing Center Co., Ltd. 17,423.85 14,500.77
Sinopharm Holding Shenyang Co., Ltd. 12,601.26 2,366.63
Sinopharm Holding Shanxi Co., Ltd. 10,473.11 9,647.58
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. 7,681.02 3,490.46
China National Medicines Co., Ltd. 3,566.89 2,124.05
Lanzhou Biotechnology Development Co., Ltd. 2,976.00 3,492.00
Sinopharm Holding Inner Mongolia Co., Ltd. 1,937.26 2,042.98
Jiangsu Wanbang Pharmacy Marketing Co., Ltd. 1,722.45 4,248.18
Sinopharm Holding Fujian Co., Ltd. 1,547.80 1,560.70
Sinopharm Holding Jilin Co., Ltd. 1,260.99 43.01
Sinopharm Xingsha Pharmaceuticals (Xiamen) Co., Ltd. 1,221.18 197.82
Sinopharm Holding Tongliao Co., Ltd. 1,137.67 -
Chengdu Rongsheng Pharmacy Co., Ltd. 1,092.34 1,036.88
Sinopharm Holding Yangzhou Co., Ltd. 1,045.00 430.00
Shenzhen Wanwei Medicine Trading Co., Ltd. 969.40 59.78
Sinopharm Holding Henan Co., Ltd. 957.83 -
Sinopharm Holding Anshan Co., Ltd. 939.15 6.34
Sinopharm Holding Lunan Co., Ltd. 900.00 450.00
Sinopharm Holding Xiamen Co., Ltd. 827.24 317.32
Sinopharm Holding Hunan Co., Ltd. 706.45 76.97
Sinopharm Holding Xinjiang Special Drugs Western Pharmaceutical Co., Ltd. 669.61 284.04
Sinopharm Holding Pingdingshan Co., Ltd. 661.51 300.00
Sinopharm Lerentang Hebei Medical Instrument Trade Co., Ltd. 656.37 568.10
Sinopharm Holding Xinjiang Xinte Shenrong Pharmaceutical Co., Ltd. 633.67 -
391
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Notes payable (Continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Yixin Pharmaceutical Co., Ltd. 513.38 1,441.63
Chongqing Yaoyou Pharmaceutical Co., Ltd. 407.81 269.34
Sinopharm Holding Huaideju (Xiamen) Pharmacy Co., Ltd. 300.04 475.58
Sinopharm Zhonglian Pharmaceutical Group Co., Ltd. 274.10 11.67
Sinopharm Holding Hulun Buir Co., Ltd. 257.72 -
Sinopharm Holding Ningxia Co., Ltd. 250.63 213.96
Shenzhen Main Luck Pharmaceutical Co., Ltd. 240.19 127.41
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 234.78 177.77
Sinopharm Holding Jinan Co., Ltd. 195.80 65.00
Jinzhou Avanc Pharmaceutical Co., Ltd. 188.15 -
Fosun Pharmaceutical Distribution Jiangsu Co., Ltd. 157.63 75.41
Sinopharm Holding Jinzhou Co., Ltd. 144.26 122.21
China Otsuka Pharmaceutical Co., Ltd. 141.88 232.17
Sinopharm Holding Benxi Co., Ltd. 132.86 -
Sinopharm Jiankun (Beijing) Medicine Co., Ltd. 98.98 191.17
Sinopharm Group Zhijun (Shenzhen) Pingshan Pharmaceutical Co., Ltd. 77.18 -
Yunnan Tianjiang Yifang Pharmaceutical Co., Ltd. 67.01 -
Foshan Winteam Pharmaceutical Group Ltd. 64.77 104.77
Sinopharm Holding Heilongjiang Co., Ltd. 54.41 -
Sinopharm Group Zhijun (Shenzhen) Pharmaceutical Co., Ltd. 53.33 63.62
Sinopharm Holding Bayannur Co., Ltd. 51.88 -
Wuhan Zhongsheng Yujin Biomedical Co., Ltd. 48.68 -
Sinopharm Holding Linfen Ningle Pharmaceutical Co., Ltd. 46.21 56.41
Shanghai Transfusion Technology Co., Ltd. 45.27 25.15
Sinopharm Holding Shanxi Dajiuzhou Medicine Co., Ltd. 41.83 53.72
Sinopharm Holding Dalian Co., Ltd. 37.12 126.93
Sinopharm Liaoning Medical Equipment Co., Ltd. 35.41 -
Sinopharm Holding Quanzhou Co., Ltd. 32.81 134.73
Sinopharm Holding Yancheng Co., Ltd. 31.07 96.73
392
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Notes payable (continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Jinzhou Avanc Medicine Co., Ltd. 26.82 65.51
Sinopharm Group Shanxi Medical Devices Co., Ltd. 23.08 143.10
Fujian Tianjiang Pharmaceutical Co., Ltd. 21.50 7.12
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 20.88 -
Taiji Group Co., Ltd. 20.42 -
Sinopharm Holding Shanxi Zhongjian Medical Device Chain Co., Ltd. 18.21 -
China National Pharmaceutical Industry Co., Ltd. 17.45 -
Sinopharm Holding Changzhou Co., Ltd. 14.00 -
Sinopharm Holding Nanping Newforce Co., Ltd. 13.70 10.06
Sinopharm Holding Changsha Co., Ltd. 11.02 2.98
Taiji Group Chongqing Fuling Pharmaceutical Factory Co., Ltd. 8.57 -
Sinopharm (Anhui) Jingfang Pharmaceutical Co., Ltd. 1.74 -
Sinopharm Group - 1,566.58
Sinopharm Lerentang Shijiazhuang Traditional Chinese Medicine Co., Ltd. - 294.62
Sinopharm Holding Tianjin Co., Ltd. - 236.55
China National Medical Device Co., Ltd. - 174.34
Sinopharm Fengliaoxing (Foshan) Pharmaceutical Drugs Co., Ltd. - 71.52
Sinopharm Wuhan Blood Products Co., Ltd. - 42.00
Sinopharm Group Rongsheng Pharmaceutical Co., Ltd. - 27.86
Shanghai Shyndec Pharmaceutical Marketing Co., Ltd. - 26.75
Sinopharm Holding Shanxi Jinzhong Co., Ltd. - 10.22
117,966.77 82,087.99
393
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Other payables
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group 599.27 414.65
Zhang Zhenfang 472.50 392.00
Sinopharm Group Shanghai Co., Ltd. 166.04 361.95
China National of Traditional & Herbal Medicine Co., Ltd. 130.00 130.00
Sinopharm Group Medicine Logistic Co., Ltd. 105.96 282.57
Xishuangbanna Disheng Pharmaceutical Co., Ltd. 37.06 -
Shanghai Tongyu Information Technology Co., Ltd. 32.21 24.99
Shanghai Beiyi Guoda Pharmaceutical Co., Ltd. 29.89 36.49
Sinopharm Group Guangdong Medicine Device Co., Ltd. 26.07 -
Sinopharm Holding (Tianjin Binhai) Pharmaceutical Co., Ltd. 24.18 -
Sinopharm Health Online Co., Ltd. 22.19 18.60
Sinopharm Holding Zhihuiminsheng (Tianjin) Pharmaceutical Co., Ltd. 19.19 16.59
Sinopharm Holding Xinjiang Xinte Karamay Pharmaceutical Co., Ltd. 10.11 -
Sinopharm Holding Sub Marketing Center Co., Ltd. 5.74 3.79
Sinopharm Holdings Beijing Huahong co., Ltd. 3.86 -
Taishan Xiangranhui Trade Co., Ltd. 2.23 -
Shenzhen Wanwei Medicine Trading Co., Ltd. 1.50 0.01
Sinopharm Tongjitang (Guizhou) Pharmaceutical Co., Ltd. 1.14 -
Zhang Haiyan 0.67 0.14
Sinopharm Guangdong Global Pharmaceutical Co., Ltd. 0.59 0.01
Shenzhen Main Luck Pharmaceutical Co., Ltd. 0.28 -
Chengdu Institute of Biological Products Co., Ltd. 0.03 0.03
Foshan Winteam Pharmaceutical Group Ltd. 0.01 -
Pingdingshan Pusheng Pharmaceutical Co., Ltd. - 51.59
Sinopharm Holding Yangzhou Co., Ltd. - 37.26
Sinopharm Holding Hunan Weian Pharmacy Medicine Chain Company Limited - 10.46
Fujian Tianjiang Pharmaceutical Co., Ltd. - 5.00
Sinopharm Group Xinjiang Special Drugs National Pharmaceutical Co., Ltd. - 2.24
1,690.72 1,788.37
394
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X. Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Contract liabilities
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Lerentang Medicine Co., Ltd. 49.26 4.04
Sinopharm Holding Inner Mongolia Co., Ltd. 14.26 0.01
Sinopharm Holding Shenyang Co., Ltd. 10.16 6.44
Sinopharm Holding Wuhu Co., Ltd. 3.66 3.04
Shenzhen Xinsheng Pharmaceutical Co., Ltd. 2.52 -
Sinopharm Holding Fujian Co., Ltd. 2.20 -
Sinopharm Lerentang Chengde Medicine Co., Ltd. 0.41 1.10
Sinopharm Lerentang Healthcare Shijiazhuang Pharmacy Co., Ltd. 0.24 -
Jiangmen Xinhui District Jianfeng Pharmaceutical Co., Ltd. 0.14 -
Sinopharm Holding Chengdu Co., Ltd. 0.09 -
Sinopharm Holding Chongqing Co., Ltd. 0.08 0.35
Sinopharm Lerentang Qinhuangdao Medicine Co., Ltd. 0.04 9.76
Sinopharm Lerentang Zhangjiakou Medicine Co., Ltd. 0.03 -
Sinopharm Lerentang Tangshan Medicine Co., Ltd. 0.03 -
Sinopharm Holding Lerentang Hebei Pharmaceutical Co., Ltd. 0.02 -
Sinopharm Holding Nantong Co., Ltd. - 107.45
Chindex Shanghai International Trading Co., Ltd. - 78.36
Sinopharm Holding Yunnan Co., Ltd. - 18.67
Sinopharm Holding Anhui Co., Ltd. - 15.49
Sinopharm Holding Nanjing Wende Pharmaceutical Co., Ltd. - 9.89
Sinopharm Lerentang Cangzhou Medicine Co., Ltd. - 2.57
Sinopharm Holding Jilin Co., Ltd. - 2.30
Sinopharm Holding Gansu Co., Ltd. - 2.20
Sinopharm Holding Hulun Buir Co., Ltd. - 2.12
Sinopharm Group Shanxi Co., Ltd. - 1.48
Sinopharm Lerentang Hengshui Medicine Co., Ltd. - 1.03
Sinopharm Holding Taizhou Co., Ltd. - 0.66
Sinopharm Holding Guizhou Medical Device Co., Ltd. - 0.11
Dongyuan accord pharmaceutical chain Co., Ltd. - 0.09
Sinopharm Holding Jiangxi Co., Ltd. - 0.02
83.14 267.18
395
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
2021 2020
(RMB‘0,000) (RMB‘0,000)
Entrusted borrowings
CNPGC (1) 3,163.72 3,163.72
Jilin Province Yihe Investment Consulting Co., Ltd. (2) 7,245.00 5,670.00
10,408.72 8,833.72
(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 payable 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. 9,235.72 1,433.87
As at 31 December 2021, the short-term borrowings from Sinopharm Group Finance Co., Ltd amounted to
(1) RMB92,357,200, including the principal of RMB92,237.70 thousand and the accrued interest outstanding of
RMB83.50 thousand.
Other non-current liabilities
Sinopharm Group 2,308.59 3,506.17
CNGCC 197.59 -
2,506.18 3,506.17
396
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
X Related party relationships and transactions (Continued)
8. Amounts due to related parties (Continued)
Lease liabilities
2021 2020
Amount Include: Amount Include:
within 1 year within 1 year
(RMB‘0,000) (RMB‘0,000) (RMB‘0,000) (RMB‘0,000)
Sinopharm Holding Yangzhou Co., Ltd. 1,382.25 324.32 - -
Shaoguan Wujiang District Muyang Medicine Information
Consultant Co., Ltd. 586.97 - 662.88 75.92
Zhang Yechuan 486.35 83.64 520.19 57.48
Guangxi Yifang Tianjiang Pharmaceutical Co., Ltd. 303.27 39.77 343.45 44.80
Wang Yixuan 283.15 50.64 - -
Xiong Xinyuan 263.69 25.17 287.33 23.65
Shenyang Shengdiou Trading Co., Ltd. 185.25 71.59 146.86 34.46
Lerentang Investment Group Co., Ltd. 181.97 120.04 611.25 611.25
Li Fang 153.61 49.02 - -
Sinopharm Holding Beijing Co., Ltd. 122.90 52.93 13.09 13.09
Beijing Sinopharm Tianyuan Real Estate & Property
Management Co., Ltd. 96.28 54.16 - -
Guangdong Jiyuantang Development Co., Ltd. 88.13 88.13 308.59 206.06
Wang Yang 61.28 61.28 - -
Sinopharm Holding Shanxi Jincheng Co., Ltd. 59.99 59.99 - -
Nanjing Yuanguang Trading Co., Ltd. 51.37 51.37 - -
Shenzhen Jiufeng Investment Co., Ltd. 37.98 18.59 - -
Zhang Haiyan 35.02 16.01 50.35 15.34
Sinopharm Group Zhijun (Shenzhen) Pingshan
Pharmaceutical Co., Ltd. 24.94 9.33 33.88 8.94
Gu Haiqun 23.28 21.44 42.79 19.52
Zhang Guitang 18.35 - - -
Beijing Huafang Investment Co., Ltd. 9.45 9.45 33.66 24.21
Sinopharm Holding (China) Financing Lease Co., Ltd. - - 38.88 46.95
Sinopharm Xinjiang Pharmaceutical Co., Ltd. - - 37.90 37.90
Shanghai Baizhong Business Development (Group) Co., Ltd. - - 30.01 30.01
Sinopharm Group - - 17.23 17.23
Pu'er Songmao Medicine Group Co., Ltd. - - 3.73 3.73
4,455.48 1,206.87 3,182.07 1,270.54
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
2021 2020
(RMB‘0,000) (RMB‘0,000)
Sinopharm Group Finance Co., Ltd. 197.44 10,177.99
In year 2021, the annual interest rates of the above deposits are 0.35%-1.89%. (In year 2020, the
annual interest rates of the above deposits are 0.35% to 1.89%.)
397
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 31 December 2020
(RMB‘0,000) (RMB‘0,000)
Capital commitments 2,649.01 -
Investment commitments 4,200.00 -
6,849.01 -
A Pursuant to the approval of Sinopharm Holdings' document [Sinopharm General Investment
[2021] No. 523], the Group subscribed for shares of the Industry Fund (Phase II) and
Gongqingcheng Qixin by contributing RMB60 million. The fund adopts a progressive funding
approach, with investors contributing in tranches. The manager of the Industry Fund will issue
payment notices to the investors according to the actual project progress. RMB18 million, 30%
of the Group's contribution, had been paid in 2021, the remaining outstanding contribution will
be RMB42 million.
2. Contingencies
As of the balance sheet date, no contingencies of the Group were required to disclose.
398
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XII Events after the balance sheet date
Pursuant to the resolution of the General Meeting of the Shareholders on 28 March 2021, the
Company paid a cash dividend of RMB6.00 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
RMB256,876,189.80. 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 engaged in 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.
399
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
1. Segment reporting (Continued)
Operating segments (Continued)
Transfer pricing between operating segments is determined by reference to prevailing market prices used in transactions with third parties
2021
Head Office Pharmaceutical distribution Pharmaceutical retail Elimination between segments Total
Operating revenue 7,949,960.12 46,832,560,521.32 22,477,630,028.55 (960,330,938.00) 68,357,809,571.99
Including: Revenue from external customers 6,050,039.72 45,876,980,488.34 22,474,779,043.93 - 68,357,809,571.99
Revenue from inter-segment transactions 1,899,920.40 955,580,032.98 2,850,984.62 (960,330,938.00) -
Interest income 171,106,520.93 41,952,376.94 33,019,049.86 (171,780,178.50) 74,297,769.23
Interest expense (44,063,652.97) (325,712,178.87) (90,105,315.49) 171,842,386.46 (288,038,760.87)
Income from investments in associates 333,164,462.64 (871,691.80) 1,104,345.54 - 333,397,116.38
Impairment losses - (3,011,609.82) (239,893,256.69) - (242,904,866.51)
Credit impairment losses (41,802.91) (56,264,830.41) 13,516,233.56 - (42,790,399.76)
Depreciation and amortisation (2,422,713.69) (195,805,646.09) (1,232,732,777.56) - (1,430,961,137.34)
Gross profit 1,033,319,869.24 1,244,798,591.94 314,940,026.85 (618,205,638.49) 1,974,852,849.54
Income taxes (18,827,115.15) (297,492,613.54) (130,890,925.98) - (447,210,654.67)
Net profit 1,014,492,754.09 947,305,978.40 184,049,100.87 (618,205,638.49) 1,527,642,194.87
Total assets 16,162,666,239.27 25,745,738,525.76 15,983,835,238.55 (15,108,557,571.77) 42,783,682,431.81
Total liabilities (4,597,179,265.95) (19,378,204,285.85) (10,301,522,762.44) 9,515,436,580.93 (24,761,469,733.31)
Long-term equity investments in associates 2,430,218,715.28 12,353,878.32 17,259,953.14 - 2,459,832,546.74
Accrual of other non-current assets except long-term equity
investments 16,556,550.41 93,513,238.39 317,962,425.20 1,980,374.57 430,012,588.57
400
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021 Expressed in Renminbi Yuan
XIII Other significant events (Continued)
1. Segment reporting (Continued)
Operating segments (Continued)
2020
Head Office Pharmaceutical distribution Pharmaceutical Retail Elimination between segments Total
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)
Investment income 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
401
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021, the rental income
recognised by the Group on those houses and buildings was RMB94,658,035.61 (2020:
RMB74,161,565.05), please refer to Note V (44) for detail. 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:
2021 2020
Lease income 94,658,035.61 74,161,565.05
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:
2021 2020
Within 1 year, inclusive 75,454,341.82 63,220,587.31
1 to 2 years, inclusive 33,350,822.06 31,911,202.23
2 to 3 years, inclusive 23,492,674.20 23,381,199.28
3 to 4 years, inclusive 15,729,184.01 15,814,769.84
4 to 5 years, inclusive 12,659,791.15 14,032,816.35
Over 5 years 25,273,970.91 34,581,707.82
185,960,784.15 182,942,282.83
402
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIII Other significant events (Continued)
2. Leases (Continued)
(2) As lessee
2021 2020
Interest expense on lease liabilities 92,242,876.69 85,172,959.79
Expenses relating to short-term leases
accounted for applying
practical expedients 254,504,259.20 149,964,881.54
Expenses relating to leases of low-value
assets accounted for applying
practical expedients (other than short-
term leases) 2,054,046.39 1,665,822.79
Variable lease payments not included in
the measurement of lease liabilities 552,909.64 326,685.01
Income from subleasing right-of-use
assets 63,322,891.37 39,592,830.17
Total cash outflow for leases 1,441,968,421.76 1,135,337,845.71
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
committed 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 2021, the real estate lease of the Group is as follows:
Stores Fixed payments Variable Total payments
payments
Fixed payments only 10,308 1,270,268,854.15 - 1,270,268,854.15
Variable payments 7 1,813,505.29 552,909.64 2,366,414.93
A 20% increase in sales across all stores in the Group would be expected to increase total
lease payments by approximately 0.04%.
403
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIII Other significant events (Continued)
2. Leases (Continued)
(2) As lessee (Continued)
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%.
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:
2021 2020
Within 1 year, inclusive 64,451,238.07 10,999,774.97
1 to 2 years, inclusive 36,133,996.11 9,064,124.03
2 to 3 years, inclusive 27,664,034.06 7,953,910.54
Over 3 years 27,610,484.54 9,528,398.65
155,859,752.78 37,546,208.19
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 (33).
404
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIV Notes to key items of the company financial statements
1. Notes receivable
31 December 2021 31 December 2020
Commercial acceptance bills 12,015,516.75 30,984,449.44
As at 31 December 2021 and 31 December 2020, no notes receivable were pledged.
As at 31 December 2021 and 31 December 2020, 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 2021 and 31 December 2020, 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 age of accounts receivable and the related provision for bad debts is analysed below:
31 December 2021 31 December 2020
Within 1 year 595,186,085.91 609,575,301.13
1 to 2 years 607,621.89 323,044.50
2 to 3 years 323,044.50 11,250.20
3 to 4 years 11,250.20 -
596,128,002.50 609,909,595.83
Less: Provision for bad debts 3,727,693.63 334,294.70
592,400,308.87 609,575,301.13
405
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021
Carrying amount Bad debt provisions Book Value
Amount Proportion Amount Proportion
Items for which provision for bad
debts is recognised individually 26,787,302.03 4.49% (3,680,022.61) 13.74% 23,107,279.42
Items for which provision for bad
debts is recognised by group
(credit risk characteristics) 569,340,700.47 95.51% (47,671.02) 0.01% 569,293,029.45
596,128,002.50 100.00% (3,727,693.63) 0.63% 592,400,308.87
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
406
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIV Notes to key items of the company financial statements (Continued)
2. Accounts receivable (Continued)
As at 31 December 2021, accounts receivable that were individually assessed for provisions are as follows:
Carrying amount Bad debt provision Expected credit Assessment for
loss rate impairment
Receivables from
subsidiaries of Internal related parties, with
the Group 23,107,279.42 - - lower-tier recovery risk
The debtor had
mismanagement, subject
to severe financial
difficulties, with lower-tier
Client A 3,345,727.91 (3,345,727.91) 100.00% recoverability
The debtor had
mismanagement, subject to
severe financial difficulties,
already in bankruptcy and
Client B 323,044.50 (323,044.50) 100.00% liquidation
The debtor had
mismanagement, subject
to severe financial
difficulties, with lower-tier
Client C 11,250.20 (11,250.20) 100.00% recoverability
26,787,302.03 (3,680,022.61)
407
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
Expected credit Assessment for
Carrying amount Bad debt provision loss rate impairment
Receivables from
subsidiaries of Internal related parties, with
the Group 18,215,230.12 - - lower-tier recovery risk
The debtor had
mismanagement, subject
to severe financial
difficulties, with lower-tier
Client A 323,044.50 (323,044.50) 100.00% recoverability
The debtor had
mismanagement, subject
to severe financial
difficulties, with lower-tier
Client B 11,250.20 (11,250.20) 100.00% recoverability
18,549,524.82 (334,294.70)
408
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 31 December 2020
Expected Expected Expected Expected
Estimated credit loss credit loss in Estimated default credit loss credit loss in
default amount rate entire lifetime amount rate entire lifetime
Within 1 year 568,733,078.58 0.002% (10,788.37) 591,360,071.01 - -
1 to 2 years 607,621.89 6.07% (36,882.65) - - -
569,340,700.47 0.01% (47,671.02) 591,360,071.01 - -
Changes in provision for bad debts are presented as follows:
Opening balance Increases in the year Written off in the year Closing balance
2021 334,294.70 3,393,398.93 - 3,727,693.63
2020 334,294.70 - - 334,294.70
The write-off of accounts receivable in 2021 was nil (2020: nil).
In 2021, the Company factored a portion of accounts receivable at amortised cost to financial institutions. The amount of
accounts receivable derecognised was RMB26,097,254.38 (2020: RMB220,416,953.64), and the amount of the loss
recognised through investment income was RMB206,333.75 (2020: RMB1,796,917.66).
As at 31 December 2021, the 5 largest accounts receivable by customer are as follows:
Bad debt provision % of the total accounts
Amount amount receivable
account receivable 39,203,844.39 - 6.58%
account receivable 36,997,271.25 (1,664.00) 6.21%
account receivable 35,229,218.49 - 5.91%
account receivable 26,905,215.05 (210.00) 4.51%
account receivable 26,149,663.37 (12,493.51) 4.39%
164,485,212.55 (14,367.51) 27.60%
As at 31 December 2020, the 5 largest accounts receivable by customer are as follows:
Bad debt provision % of the total accounts
Amount amount receivable
account receivable 46,764,250.67 - 7.67%
account receivable 37,228,662.30 - 6.10%
account receivable 32,827,136.08 - 5.38%
account receivable 31,808,768.35 - 5.22%
account receivable 24,876,276.35 - 4.08%
173,505,093.75 - 28.45%
409
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIV Notes to key items of the company financial statements (Continued)
3. Receivables financing
31 December 2021 31 December 2020
Bank acceptance bills - 30,248,631.32
As at 31 December 2021 and 31 December 2020, no receivables financing were pledged.
Receivables financing endorsed or discounted by the Company to other parties which were not yet due at
31 December 2021 and 31 December 2020 are as follows:
31 December 2021 31 December 2020
Derecognised Not derecognised Derecognised Not derecognised
Bank acceptance bills 68,320,326.73 - 46,423,327.83 -
As at 31 December 2021 and 31 December 2020, 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 2021 31 December 2020
Other receivables 5,003,805,208.01 3,562,309,346.07
5,003,805,208.01 3,562,309,346.07
410
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIV Notes to key items of the company financial statements (Continued)
4. Other receivables (Continued)
Other receivables
The age of other receivables is analysed below:
31 December 2021 31 December 2020
Within 1 year 5,002,403,914.46 3,561,693,028.43
1 to 2 years 2,393,007.78 1,589,947.19
2 to 3 years 21,749.51 44,416,956.36
Over 3 years 54,391,355.91 9,980,030.83
5,059,210,027.66 3,617,679,962.81
Less: Provision for bad debts 55,404,819.65 55,370,616.74
5,003,805,208.01 3,562,309,346.07
The other receivables by category are listed below:
31 December 2021 31 December 2020
Amounts due from subsidiaries 4,989,971,028.15 3,539,822,609.73
Receivables from equity transactions 8,980,000.00 8,980,000.00
Deposits 344,600.17 343,834.42
Others 59,914,399.34 68,533,518.66
5,059,210,027.66 3,617,679,962.81
Less: Provision for bad debts 55,404,819.65 55,370,616.74
5,003,805,208.01 3,562,309,346.07
411
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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
credit losses) Total
- 56,394.50 55,314,222.24 55,370,616.74
Balance at 1 January 2021
- - - -
Balance at 1 January 2021 during the period
- - - -
--Transfer to Stage 2
- - - -
--Transfer to Stage 3
- - - -
--Reverse to Stage 2
- - - -
--Reverse to Stage 1
- 177,583.25 - 177,583.25
Provisions during the period
- (143,380.34) - (143,380.34)
Reversal during the period
- - - -
Write-back during the period
- - - -
Write-off during the period
- - - -
Others
Balance at 31 December 2021 - 90,597.41 55,314,222.24 55,404,819.65
Stage 3
Stage 1 Stage 2
Credit-impaired
12-month Lifetime
financial assets
expected expected
(Lifetime expected
credit losses credit losses
credit losses) Total
- 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
- - - -
Others
- - - -
Balance at 31 December 2020 - 56,394.50 55,314,222.24 55,370,616.74
412
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIV Notes to key items of the company financial statements (Continued)
4. Other receivables (Continued)
The bad debt provision amount for other receivables in 2021 was RMB177,583.25 (2020: RMB999,363.59),
with the recovered or reversed amount of RMB143,380.34 (2020: RMB33,593.85).
The write-off of other receivables in 2021 was nil (2020: nil).
As at 31 December 2021, the 5 largest accumulated other receivables are analysed below:
% of the total
other Bad debt
Nature Amount Aging receivable provision
Sinopharm Guangzhou Entrusted loans 2,662,615,280.69 Within 1 year 52.63% -
Sinopharm Guangxi Entrusted loans 910,330,178.60 Within 1 year 17.99% -
Sinopharm Dongguan Entrusted loans 161,157,628.14 Within 1 year 3.19% -
Sinopharm Jiangmen Entrusted loans 142,756,424.19 Within 1 year 2.82% -
Sinopharm Yuexing Entrusted loans 133,804,911.22 Within 1 year 2.64% -
4,010,664,422.84 79.27% -
As at 31 December 2020, the 5 largest accumulated other receivables are analysed below:
% of the total
other Bad debt
Nature Amount Aging receivables 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% -
5. Long-term equity investments
31 December 2021 31 December 2020
Investments in subsidiaries (1) 5,614,677,427.58 5,614,677,427.58
Investments in associates (2) 2,470,148,715.28 2,298,920,817.58
8,084,826,142.86 7,913,598,245.16
Less: Provision for impairment of long-
term equity investments 39,930,000.00 39,930,000.00
8,044,896,142.86 7,873,668,245.16
413
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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 2021 in investment cost 31 December 2021 (%) (%)
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 under Other Other changes Cash dividend At end of the year Amount of
year the equity method comprehensive in equity declared (Carrying amount) provision for
(Carrying amount) income impairment
Zhijun Suzhou 39,930,000.00 - - - - - 39,930,000.00 (39,930,000.00)
Main Luck
Pharmaceutical 322,696,745.87 - 88,173,434.93 - - (70,380,000.00) 340,490,180.80 -
Zhijun Pingshan 176,566,795.90 - 41,892,944.28 - - (34,553,476.37) 183,906,263.81 -
Zhijun Medicine 425,557,825.11 - 110,083,777.09 - - (39,098,661.04) 496,542,941.16 -
Zhijun Trade 10,408,675.18 - 498,196.67 - - (529,453.96) 10,377,417.89 -
Shyndec Pharma 1,323,760,775.52 - 92,516,109.67 41,192.92 (701,946.29) (16,714,220.20) 1,398,901,911.62 -
2,298,920,817.58 - 333,164,462.64 41,192.92 (701,946.29) (161,275,811.57) 2,470,148,715.28 (39,930,000.00)
414
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
XIV Notes to key items of the company financial statements (Continued)
6. Operating revenue and cost
2021 2020
Revenue Cost Revenue Cost
Principal operations 4,199,873,013.74 4,044,997,966.22 3,804,104,902.73 3,653,114,484.10
Other operations 29,688,633.57 19,322,883.84 49,554,098.39 21,758,477.24
4,229,561,647.31 4,064,320,850.06 3,853,659,001.12 3,674,872,961.34
Revenue is as follows:
2021 2020
Revenue from contracts with customers 4,221,347,438.36 3,844,963,018.49
Rentals 8,214,208.95 8,695,982.63
4,229,561,647.31 3,853,659,001.12
Disaggregation of revenue from contracts with customers is as follows:
2021 2020
Place of business
China 4,221,347,438.36 3,844,963,018.49
Types of major activities
Pharmaceutical distribution 4,199,873,013.74 3,804,104,902.73
Others 21,474,424.62 40,858,115.76
4,221,347,438.36 3,844,963,018.49
Types of major goods
Pharmaceuticals 4,008,242,048.13 3,539,964,107.30
Medical devices and disposables 182,517,806.08 254,850,921.90
Diagnostic reagents 9,048,841.54 9,285,448.75
Medical equipment 64,317.99 4,424.78
Others 21,474,424.62 40,858,115.76
4,221,347,438.36 3,844,963,018.49
Timing of revenue recognition
At a point in time
Sale of goods 4,199,873,013.74 3,804,104,902.73
Over time
Providing services 21,474,424.62 40,858,115.76
4,221,347,438.36 3,844,963,018.49
415
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
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:
2021 2020
Sale of goods 1,807,562.61 7,293,184.46
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 after the service is completed.
7. Investment income
2021 2020
Gain on long-term equity investments under
the cost method 619,290,387.90 612,502,685.91
Gain on long-term equity investments under
the equity method 333,164,462.64 353,352,207.87
Dividends from other financial assets 3,599,555.61 4,109,881.90
Income from the derecognition of financial
assets measured at amortised cost (206,333.75) (1,796,917.66)
Others - 998,665.84
955,848,072.40 969,166,523.86
416
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS
Year ended 31 December 2021
Supplementary information to financial statements
1. Schedule of non-recurring profit or loss
Amount for 2021
Gains and losses on disposal of non-current assets,
including write-off of an accrued asset impairment 2,819,900.34
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 75,900,940.54
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 219,279.00
Reversal of bad debt provision for accounts receivable that were tested for
impairment individually 1,491,750.76
Non-operating income and expenses other than the aforesaid items 20,642,938.09
Others 3,891,236.81
104,966,045.54
Impact on income tax (24,001,469.59)
Impact on non-controlling interests after tax (30,842,799.01)
50,121,776.94
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).
1 417
CHINA NATIONAL ACCORD MEDICINES CORPORATION LTD.
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS (CONTINUED)
Year ended 31 December 2021
Supplementary information to financial statements (Continued)
2. Return on equity (“ROE”) and earnings per share (“EPS”)
2021
Weighted average Basic EPS (1)
ROE (%)
Net profit attributable to the ordinary shareholders of the parent 9.29 3.12
Net profit after deducting non-recurring profit or loss
attributable to the ordinary shareholders of the parent 8.94 3.00
2020
Weighted average Basic EPS (1)
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
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 2021 (2020: nil), and hence, no
presentation of diluted EPS was provided.
China National Accord Medicines Corporation Ltd.
Legal Representative: Lin Zhaoxiong
30 March 2022
418
