Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
SHENZHEN NANSHAN POWER CO.,LTD
2011 Annual Report
Report Ref.: 2012－012
April 24, 2012
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Important Prompt
The board of directors, board of supervisors as well as the directors, supervisors and senior
managers of the Company guarantee that the data in this report are correct, true, free of misleading
statement and misstatement, and undertake individual and joint responsibilities on the authenticity,
accuracy and integrity.
Director Huangpu Han and director Jiang Xiaojun failed to attend the meeting for public reasons,
and authorized director Yu Chunling and vice board chairman Sun Yulin to attend the meeting and
exercise voting power respectively. The board meeting has reviewed and passed the whole text of the
2010 annual report.
Deloitte provides the Company with an audit report which has explanatory paragraphs without
qualified opinions. The board of directors and board of supervisors of the Company also specify relevant
items in details and the investors shall read carefully.
Yang Haixian, president of the Company, Fu Bo, executive director as well as Lu Xiaoping, chief
financial officer, and Huang Jian, manager of financial management department declare that: the financial
report in the annual report is true and complete.
This report is compiled in both Chinese and English, and the Chinese version will prevail if there is
any difference or deviation between the two versions.
Contents
I. Brief Introduction to the Company---------------------------------------------------------------------------------3
II. Abstract of Accounting Data and Business Data----------------------------------------------------------------5
III. Capital Share Alternation and Shareholder information-------------------------------------------------------8
IV. Director, Supervisor, Senior Manager as well as Employer ------------------------------------------------12
V. Organization Structure of the Company-------------------------------------------------------------------------21
VI. Brief Introduction to the general Meeting of Shareholders--------------------------------------------------26
VII. Report of Board of Directors-----------------------------------------------------------------------------------26
VIII. Report of Board of Supervisors--------------------------------------------------------------------------------39
Ⅸ. Important Items----------------------------------------------------------------------------------------------------41
Ⅹ. Financial Report---------------------------------------------------------------------------------------------------47
Ⅺ. Further References------------------------------------------------------------------------------------------------48
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
I. Brief Introduction to the Company
(I) Legal Name In Chinese: 深圳南山热电股份有限公司
Legal Name in English: SHENZHEN NANSHAN POWER CO., LTD
(II) Corporate representative: Yang Haixian
(III) Secretary of board of directors: Hu Qin
Telephone: (0755) 26948888
Fax: (0755) 26003684
Email: investor@nspower.com.cn
Contact address: Building 16 and 17, Hantang Mansion, Huaqiao Town, Nanshan District,
Shenzhen, China
(IV) Registered address: No. 2097, Moon bay Blvd, Nanshan District, Shenzhen, China
Postal code: 518052
Business address: Building 16 and 17, Hantang Mansion, Huaqiao Town, Nanshan District,
Shenzhen, China
Postal code: 518053
Website: http://www.nsrd.com.cn
Email: public@nspower.com.cn
(V) Designated newspapers for information disclosure: Secutimes, China Securities Journal and
Hong Kong Commercial Daily
Website designated by China Securities Regulatory Committee for publishing the annual report:
http://www.cninfo.com.cn
The annual report is prepared and kept by: Secretariat of board of directors
(VI) Stock Exchange: Shenzhen Stock Exchange
Short name and code of share: SND A 000037
SND B 200037
(VII) Other information
Initial registration date: April 6th, 1990
Initial registered address: Nanshan Jiaoju, Nanshan District, Shenzhen
(IV) Registration address after alternation: No. 2097, Moon bay Blvd, Nanshan District, Shenzhen,
China
Number of the business license for corporate: 440301501125497
Tax registration number: YSWZ 440305930100069 No. (14)
Code of organization: 61881512－1
The accounting firm designated by the Company: Deloitte
Business address: Building 30, Bund Center, No. 222. East Yan An Road, Shanghai, China
(VIII) Explanation:
Company, and the Company: SHENZHEN NANSHAN POWER CO., LTD
Server Company: Shenzhen server Petrochemical Supplying Co., Ltd. with 50% shares held by
the Company
New Electric Power Company: Shenzhen New Electric Power Industry Co., Ltd with 100%
shares held by the Company
Singapore Company: Shennan Energy (Singapore) Co., Ltd with 100% shares held by the
Company
HONGKONG SYNDISOME CO.,LTD: Hong Kong Syndidome Co., Ltd
Shenzhen Nanshan Power Engineering Co., Ltd. : Shenzhen Nanshan Power Gas Turbine
Engineering Technology Co., Ltd with 100% shares held by the Company
Shenzhen Nanshan Power (Zhongshan) Co., Ltd: Shenzhen Nanshan Power (Zhongshan)
Electrical Power Co., Ltd with 80% shares held by the Company
Shenzhen Nanshan Power (Dongguan) Company: Shenzhen Nanshan Power (Dongguan) Weimei
Electrical Power Co., Ltd with 70% shares held by the Company
Shenzhen Nanshan Power (Zhongshan) Environmental Protection Company: Shenzhen Nanshan
Power Environmental Protection Co., Ltd. with 100% shares held by the Company
Energy Environmental Protection Company: Shenzhen Energy Environment Engineering Co.,
Ltd. with 10% shares held by the Company
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Nanshan Power Plant: Nanshan Power Plant of Shenzhen Nanshan Power Co., Ltd. It is the
secondary organization of the Company
Zhongshan Nanlang Power Plant: Zhongshan Nanlang Power Plant of Shenzhen Nanshan Power
(Zhongshan) Electrical Power Co., Ltd
Dongguan Gaobu Power Plant: Dongguan Gaobu Power Plant of Shenzhen Nanshan Power
(Dongguan) Weimei Electrical Power Co., Ltd, with 70% shares held by the Company
Shenzhong Property Company: Zhongshan Shenzhong Real Estate Investment Co., Ltd with
75% shares held by the Company
Shenzhong Real Estate Company: Zhongshan Shenzhong Real Estate Development Co., Ltd with
75% shares held by the Company
Jiangxi Xinchang Company: CPI JIANGXI XINCHANG POWER GENERATION CO.,LTD.
with 30% shares held by the Company
Jiangxi Pengze Eletronuclear Company: China Power Investment Jiangxi Eletronuclear Co., Ltd
with 5% shares held by the Company
CSRC: China Securities Regulatory Committee
Shenzhen Securities Regulatory Commission: Shenzhen Regulatory Authority of China
Securities Regulatory Committee
Shenzhen Stock Exchange: Shenzhen Stock Exchange
Designated newspapers: Secutimes, China Securities Journal and Hong Kong Commercial Daily
RMB: All the base currency of the financial data and monetary unit in the financial report refers
to RMB except for special explanation.
II. Abstract of Accounting Data and Business Data
(I) Main Accounting Data of the year (Unit:RMB Yuan)
Item Amount
Operating profit -1,489,309,387.55
Total profit 22,255,754.48
Net profit of the shareholders of the public listed
17,529,063.37
company
Net profit of the shareholders of the public listed -288,696,800.75
company excluding non-recurring profit and loss
Net cash flow generated by operational activities 272,285,341.26
Item and value excluding non-recurring profit and loss (Unit: RMB)
Items Amount
Net profit 9,031,612.15
Less: Income from disposal of non-current assets 113,277,953.88
Governmental subsidy charged to the gain or loss of the
present period (excluding the governmental subsidy closely
related to enterprise’s business, and enjoyed based on norm
or fixed amount according to national uniform standard 245,208.34
Carry-back of accounts receivable depreciation reserve 1,185,260.28
conducted depreciation test separately
Reimbursement of VAT for import of natural gas 214,622,872.15
Other non-operating income and expenditure except for 4,988,236.41
the abovementioned items
Influenced amount of income tax of non-recurring profit -8,532,710.17
or loss
Net (loss) / profit attributing to the parent company after -316,755,208.74
deduction of non-recurring profit or loss
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Where:
Attributed to the stockholders of parent company -288,696,800.75
Influenced amount of minor stockholders’ equity (after tax) -28,058,407.99
(II) Adjustment on Profit and Net Assets According to International Accounting Standards
In the report period, there are no differences on the net profits and net assets at home and aboard.
(III) Main Accounting Data and Financial Index of the Past Three Years
1. Main Accounting Data of the Latest Three Years (Unit: RMB Yuan)
Item 2011 2010 2009
Operating income 2,415,817,730.35 1,601,730,465.30 1,867,829,757.71
Total profit 22,255,754.48 -98,645,669.78 131,976,361.23
Net profit of the
shareholders of the public 17,529,063.37 -114,638,678.20 74,088,210.90
listed company
Net profit of the
shareholders of the public
-288,696,800.75 -240,261,931.27 55,625,824.88
listed company excluding
non-recurring profit and loss
Net cash flow generated by
272,285,341.26 25,897,944.97 348,353,702.91
operational activities
Item
Total assets 5,452,746,682.91 5,278,954,349.90 4,926,596,324.59
Equity of shareholders of the
1,753,371,551.83 1,735,842,488.46 1,850,481,166.66
public listed company
Capital share 602,762,596.00 602,762,596.00 602,762,596.00
2. Main Financial Index of the Latest Three Years
2009
Items 2011 2010 Before After
adjustment adjustment
Basic earnings per share (RMB/share) 0.03 -0.19 0.12 0.12
Diluted earnings per share (RMB/share) Inapplicable Inapplicable Inapplicable Inapplicable
Basic earnings of each share excluding non-recurring
profit and loss (RMB/share) -0.48 -0.40 0.09 0.09
The weighted average net assets returns ratio (%) 1.00 -6.38 4.09 4.09
The weighted average net assets returns ratio excluding
non-recurring profit and loss (%) -16.55 -13.37 3.07 3.07
Net cash flow generated by each share of operational
activities (RMB/share) 0.45 0.04 0.58 0.58
End of 2009
Item End of 2011 End of 2010 Before After
adjustment adjustment
Net asset of each share of the shareholders of the public
2.91 2.88 3.06 3.07
listed company (RMB)
(IV) Attached Table of the Profit Statement in the Reporting Period
Earnings per share
Weighted average net assets
Profit in the reporting period Basic earnings of Diluted earnings
income rate (%)
per share per share
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Net profit attributed to common
1.00 0.03 Inapplicable
stockholders of the Company
Net profit attributed to common
stockholders of the Company after
-16.55 -0.48 Inapplicable
deduction of non-recurring profit
and loss
(V) Statement of asset depreciation reserve
Decrease of current year
Opening book Increase of current Carried back Charge-off Closing book
Items balance year balance
I. Bad debt reserve
34,896,098.38 2,361,004.16 1,185,260.28 - 36,071,842.26
II. Inventory depreciation
reserve 65,924,126.88 15,854,028.57 - 3,599,675.45 78,178,480.00
III. Long-term equity
investment depreciation reserve 2,500,000.00 - - - 2,500,000.00
IV. Fixed asset depreciation
reserve 32,981,137.38 6,265,762.65 - 2,654,224.03 36,592,676.00
V. Depreciation reserve of
construction in progress 14,790,696.15 226,400.00 - - 15,017,096.15
VI. Intangible assets
depreciation reserve 5,115,063.71 - - - 5,115,063.71
VII. Other depreciation
reserves 1,633,199.83 - - 1,633,199.83 -
Total
157,840,322.33 24,707,195.38 1,185,260.28 7,887,099.31 173,475,158.12
III. Information on Capital Stock Alteration and Stockholders
(I) Capital stock alteration
1. Table of capital stock alternation (As of December 31, 2011) (Unit: share)
shares Increased or
Before the alternation decreased in the After the alternation
Contents alternation (+,-)
Number Ratio (%) Others Number Ratio (%)
I. Shares with limited sales
18,263 0.003 18,263 0.000
conditions
1. Shares held by state
2. Shares held by
0 0 0 0
state-owned corporate
3. Shares held by other
domestic capitals
Wherein: shares held by
other domestic non-state
corporate
Shares held by domestic
natural persons
4. Shares held by foreign
capitals
Wherein: shares held by
foreign corporate
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Shares held by domestic
natural persons
5. Shares of executives 18,263 0.003 18,263 0.003
II. Shares with unlimited
602,744,333 99.998 602,744,333 99.998
sales condition
1. Ordinary shares 338,894,012 56.22 338,894,012 56.24
2. Domestically limited
263,850,321 43.77 263,850,321 43.77
foreign shares
3. Foreign share listed
overseas
4. Others
III. Total shares 602,762,596 100 0 602,762,596 100
[Note] ―Shares held by senior executives‖ among the shares with limited sales conditions at the end of the
reporting period are the A shares held by deputy general manager Zhang Jie and supervisor Peng Bo, and
B share held by supervisor Li Huiwen, and all the shares are frozen.
2. Alternation table of shares with limited sales conditions (Unit: share)
Shares with Shares with Shares with Shares with
limited sales limited sales limited sales limited sales Date for
Name of Reason for limited
at the condition condition condition at releasing
shareholder sales
beginning of released in the increased in the end of the limited sales
the year year the year year
Zhang Jie 12,993 0 0 12,993 Legal conditions -
Peng Bo 1,145 0 0 1,145 Legal conditions
Li Huiwen 4,125 0 0 4,125 Legal conditions
Total 18,263 0 0 18,263
(II) Share Issuing and Listing
1. The Company did not issue shares and derivative securities in the past three years.
2. In the reporting period, alternation of the total shares and structure, and alternation of the asset and
liabilities structure are not caused due to presenting shares, turning to increase share capitals,
offering shares, further issuing new shares, issuing shares in a non-public way, exercising warrants,
implementing share ownership incentive plan, jointing enterprises, transferring convertible bonds,
listing internal employee shares, issuing bonds or other causes.
3. There are no existing internal employee shares in the Company.
(III) Shareholders and Actual Controllers
1. At the end of the reporting period, the total number of the Company’s shareholders is 44,421,
including 28,735 A share shareholders, decreased by 391 over the previous year, and 15,686 is B
share shareholders, decreased by 456 over the previous year.
2. Shareholding information of the shareholders (As of December 31, 2011) (Unit: share)
Total stockholders 44,421
Shareholding of the top ten shareholders
Total number Number of shares Number of shares
Nature of Shareholdin
Name of shareholder of with limited sales which are pledged
stockholders g ratio
shareholders condition or frozen
State-owned
Shenzhen Guangju Investment Holding Co., Ltd 16.72% 100,769,712 0 0
corporate
Hong Kong Nanhai Foreign Firm (International) Overseas
15.28% 92,123,248 0 0
Co., Ltd corporate
State-owned
Shenzhen Energy Corporation 10.80% 65,106,130 0 0
corporate
Overseas
Tengda Property Co., Ltd 8.20% 49,426,518 0 0
corporate
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
State Grid Shenzhen Energy Development Group State-owned
5.97% 35,999,805 0 0
Co., Ltd corporate
Domestic
Yan Tiangong 0.53% 3,201,310 0 Unknown
natural person
Domestic
Li Weiping 0.39% 2,376,301 0 Unknown
natural person
Overseas
Jinbang Securities Co., Ltd. 0.25% 1,500,000 0 Unknown
corporate
Domestic
Wu Shuhua 0.22% 1,351,400 0 Unknown
natural person
Overseas
Naito Securities Co., Ltd. 0.20% 1,214,586 0 Unknown
corporate
Shareholding condition of the top ten shareholders with unlimited sale condition
Number of shares with unlimited sales
Name of shareholder Type of share
condition
Shenzhen Guangju Investment Holding Co., Ltd 100,769,712 RMB common share
Hong Kong Nanhai Foreign Firm (International)
92,123,248 Domestically listed foreign share
Co., Ltd
Shenzhen Energy Corporation 65,106,130 RMB common share
Tengda Property Co., Ltd 49,426,518 Domestically listed foreign share
State Grid Shenzhen Energy Development Group
35,999,805 RMB common share
Co., Ltd
Yan Tiangong 3,201,310 Domestically listed foreign share
Li Weiping 2,376,301 Domestically listed foreign share
Jinbang Securities Co., Ltd. 1,500,000 Domestically listed foreign share
Wu Shuhua 1,351,400 RMB common share
Naito Securities Co., Ltd. 1,214,586 Domestically listed foreign share
1. Shenzhen Energy Corporation holds 100% shares of Hong Kong Nanhai
Explanations on the incidence relation and Foreign Firm (International) Co., Ltd
consistent actions of the above shareholders 2. The Company does not know whether the above social public shareholders
have incidence relation or belong to the persons acting in concert or not.
3. Information of dominant shareholders and actual controllers
The Company does not have the dominant shareholders and actual controllers and it is not changed in the
reporting period.
4. The first majority shareholder of the Company
The first majority shareholder of the Company is not altered in the reporting period.
In the reporting period, Shenzhen Energy Co., Ltd directly and indirectly holds 157,229,378 shares of the
Company, which accounts for 26.08% of the total shares of the Company, and remains as the first
majority shareholder of the Company.
Legal representative: Gao Zimin; date of foundationL July 15, 1985; registration capital: 955,555,556
RMB; business type: limited liability company; business scope: developing, producing, purchasing and
selling various normal energies (including power, heat, coal, oil and gas) and new energies, designing,
constructing, managing and operating various energy engineering projects, operating equipments and
accessories, apparatuses, aluminum materials, wood materials, cement and other materials needed by the
energy engineering project, operating import-export services (handled as per SMGSZZ No. 147
Document), operating the services of personnel training and consulting matched with the energy
engineering, as well as other relevant services (report or declare additionally for details), developing and
transferring environmental protection technologies, and providing technical service, investing and
operating the transportation services on the fuels, materials and equipments needed by the energy project.
Property management (operating with the property management qualification certificate) and own
property leasing.
Chart of property right and control relationship between major stockholders and the Company:
Explanation of the names in the diagram below:
The Company: Shenzhen Nanshan Power Co., Ltd
Shenzhen Energy Group: Shenzhen Energy Corporation
Nanhai Foreign Firm: Hong Kong Nanhai Foreign Firm (International) Co., Ltd
Guangju Industry: Shenzhen Guangju Industry Co., Ltd.
Hong Kong Tengda: Tengda Property Co., Ltd
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
State Grid Energy: State Grid Shenzhen Energy Development Group Co., Ltd
Hong Kong Energy: Shenzhen Energy (Hong Kong) International Co., Ltd.
Guangju Energy: Shenzhen Guangju Energy Co., Ltd
Shennan Group: Shenzhen Shennan Petroleum (Group) Co., Ltd
Kehuitong: Shenzhen Kehuitong Investment Holding Co., Ltd Shenzhen Guangju Investment
Holding Co., Ltd
Shenzhen Nanshan State-owned Assets Supervision and Administration Commission
100%
Kehuitong
46.34%
Shenzhen State-owned Assets
Supervision and Administration Commission Shennan Group Mr. Li Li State Property Management
Commission of the State Counil
75% 57.61% 100% 100%
100%
Energy Group Hong Kong Energy Guangju Energy Peace Country International Limited State Grid
100% 100% 100% 100%
Nanhai Foreign Firm Guangju Holding Hong Kong Tengda State Grid Energy
10.80% 15.28% 16.72% 8.20% 5.97%
The Company
5. Other shareholders holding more than 10% (inclusive 10%) corporate shares
(1) Shenzhen Guangju Investment Holding Co., Ltd, which was established on May 31, 1989 with a
registration capital of 0.111 billion RMB, holds 16.72% of shares; its corporate representative is
Wang Jianbin and its property is liability limited company. Its operating scope includes industrial
projects and power investment (the detailed projects are additionally reported or declared).
(2) Hong Kong Nanhai Foreign Firm (International) Co., Ltd, established on May 15, 1985 holds
15.28% of shares; and its operating scope is investment.
IV. Directors, Supervisors, Senior Managers and Employees
(I) Basic Information
1. Board Members
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Whether
Pretax reward
getting from
Shareholdin Shareholdin sum got from
Starting the
Ending g at the g at the Alternation the Company in
Name Post Gender Age date shareholder
date beginning of beginning of cause the reporting
unit or other
the year the year period (ten
associated unit
thousand RMB)
or not
Yang
President Male 55 2011.5 2014.5 0 0 74.13 No
Haixian
Li 2014.5
Vice-presiden
Hongshe Male 48 2011.5 0 0 0 Yes
t
ng
Sun Vice-presiden 2014.5
Male 60 2011.5 0 0 0 Yes
Yulin t
Director 2014.5
Fu Bo General Male 49 2011.5 0 0 66.85 No
manager
Huangpu 2014.5
Director Male 57 2011.5 0 0 0 Yes
Han
Yu 2014.5
Director Female 46 2011.5 0 0 0 Yes
Chunling
Zhou 2014.5
Director Male 47 2011.5 0 0 0 Yes
Qun
Chen 2014.5 0 0
Director Female 48 2011.5 0 Yes
Lihong
Jiang 2014.5 0 0
Director Male 47 2011.5 0 Yes
Xiaojun
Independent 2014.5 0 0 6.94 No
Li Zheng Male 54 2011.5
director
Wang 2014.5
Independent
Xiaodon Male 51 2011.5 0 0 6.94 No
director
g
Wang Independent 2014.5
Male 51 2011.5 0 0 6.94 No
Junsheng director
Wu Independent 2014.5
Female 47 2011.5 0 0 11.90 No
Xiaolei director
Tang Independent 2014.5
Male 51 2011.5 0 0 6.94 No
Tianyun director
Pan 2014.5
Independent
Chengwe Male 65 2011.5 0 0 6.94 No
director
i
Total 0 0 187.58
[Note] The standard of allowance for independent directors is 100,000 Yuan/ year (after tax) for
each person. After re-election in May 2011, the allowance for new independent directors in 2011 was
58,300 Yuan/ person (after tax). Where, independent director Wu Xiaolei was re-elected, and acquired
allowance for independent directors 100,000 Yuan (after tax) in 2011.
2. Current members of the board of supervisors
Pretax reward Whether
Shareholdin Shareholdin sum got from the getting from
Starting Ending g at the g at the Alternation Company in the the shareholder
Name Position Gender Age
date date beginning of beginning of cause reporting period unit or other
the year the year (ten thousand associated unit
RMB) or not
Zhao Chief 2011.5 2014.5
Male 53 0 0 0 Yes
Xiangzhi supervisor
Ma 2011.5 2014.5
Fengmin Supervisor Female 49 0 0 0 Yes
g
Ji 2011.5 2014.5
Yuanhon Supervisor Female 47 0 0 0 Yes
g
Wang 2011.5 2014.5
Supervisor Male 43 0 0 0 Yes
Difei
Zheng Employee 2011.5 2014.5
Male 47 0 0 37.67 No
Dalei supervisor
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Employee 2011.5 2014.5
Peng Bo Male 38 1,527 1,527 Note 35.40 No
supervisor
Li Employee 2011.5 2014.5 No
Female 49 5,500 5,500 note 35.96
Huiwen supervisor
Employee 2011.5 2014.5 No
Tao Lin Male 44 0 0 31.90
supervisor
Total 7,027 7,027 140.93
[Note] The shares held by employee supervisor Peng Bo was purchased from a secondary market before
he worked as employee supervisor of the Company; wherein 382 shares have met the conditions of
releasing restrictions on sale and 1,145 shares still belong to legal shares restricted to be sold. The shares
held by employee supervisor Li Huiwen was purchased from a secondary market before he worked as
employee supervisor of the Company; wherein 1,375 shares have met the conditions of releasing
restrictions on sale and 4,125 shares still belong to legal shares restricted to be sold.
3. Current senior managers
Pretax reward Whether
Shareholding Shareholding sum got from the getting from the
Starting
Ending at the at the Alternation Company in the shareholder
Name Post Gender Age date
date beginning of beginning of cause reporting period unit or other
the year the year (ten thousand associated unit
RMB) or not
Managing 2011.5 2014.5
Fu Bo Male 49 0 0 66.85 No
director
Deputy 2011.5 2014.5
Lin Qing general Female 47 0 0 59.59 No
manager
Deputy 2011.5 2014.5
Ji Ming general Male 55 0 0 59.56 No
manager
Deputy 2011.5 2014.5
Zhang Jie general Female 43 17,325 17,325 Note 59.59 No
manager
Deputy 2011.5 2014.5
Zhu Wei general Male 54 0 0 59.76 No
manager
Wang Chief 2011.5 2014.5
Male 50 0 0 59.66 No
Rendong engineer
Chief 2011.5 2014.5
Lu
financial Male 49 0 0 59.56 No
Xiaoping
officer
Secretar 2011.5 2014.5
y to the
Hu Qin Female 44 0 0 44.90 No
board of
directors
Total 17,325 17,325 469.47
[Note] The shares held by the deputy general manager, Zhang Jie was purchased from a secondary market
before he worked as the deputy general manager of the Company; wherein 4,332 shares have met the
conditions of releasing restrictions on sale and 12,993 shares are still legal shares limited to sell.
4. Incumbency of current directors and supervisors at stockholders’ units
Name From Post Working period
Yang
Shenzhen Energy Corporation Party committee member and director From September 2008 till now
Haixian
Li
Managing director of Shenzhen Guangju
Hongshen Shenzhen Guangju Energy Co., Ltd Since October 2009
Energy Co., Ltd.
g
State Grid Shenzhen Energy Bureau-level researcher of State Grid
Sun Yulin Since 2010
Development Group Co., Ltd International Development Co., Ltd.
Huangpu
Shenzhen Energy Corporation Deputy general manager Since May 2006
Han
Yu General manager of Shenzhen Energy
Shenzhen Energy Corporation Since 2009
Chunling (Hong Kong) International Co., Ltd.
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Board chairman of Shenzhen Energy
Zhou Qun Shenzhen Energy Corporation Since 2006
Finance Co., Ltd.
Chen Shenzhen Guangju Investment Holding
Deputy general manager Since 2005
Lihong Co., Ltd.
Jiang State Grid Shenzhen Energy State Grid International Development Co.,
Since 2009
Xiaojun Development Group Co., Ltd. Ltd. Deputy general manager
Zhao
Shenzhen Energy Corporation Chief accountant Since April 2001
Xiangzhi
Ma
Shenzhen Energy Corporation Employee supervisor Since November 2011
Fengming
Ji Shenzhen Guangju Investment Holding Deputy general manager, secretary to the
Since May 2008
Yuanhong Co., Ltd. board of directors
Wang State Grid Shenzhen Energy Director of Shenzhen Business Office, State
Since 2005
Difei Development Group Co., Ltd. Grid International Development Co., Ltd.
5. Main working experiences of the current directors, supervisors and senior managers as well as their
full-time or part-time office performances in other units except the shareholding company.
(1) Board members
Mr. Yang Haixian, born in 1956, president, senior economic engineer, senior administration engineer
and MBA, used to hold a position of deputy regimental commander of PLA, had has successively worked
as deputy chief of the office of Shenzhen municipal party committee’s economic working department,
deputy chief of the office and deputy director of Shenzhen-based unit working committee of Shenzhen
municipal party committee, general manager assistance and member of party committee of Shenzhen
Energy Co., Ltd as well as the convener of board of directors of Shenzhen Western Company; and now
holds the posts of member and director of the party committees of Shenzhen Municipal Energy Group
Co., Ltd and Shenzhen Energy Group Co., Ltd, president of Singapore Company and director of Energy
Environmental Protection Company, as well as representative of fourth Shenzhen Municipal People's
Congress and the member of Economic Work Committee of Shenzhen Municipal Standing Committee of
People's Congress.
Mr. Li Hongsheng, born in 1963, vice board chairman, master of engineering of Tianjin University,
had has successively worked as deputy general manager of Zhongyuan (Hong Kong) Property Co., Ltd,
deputy general manager of Zhongyuan (Hong Kong) Industry and Trade Holdings Co., Ltd, director of
Shenzhen Nanshan Petroleum (Group) Co., Ltd, director and chief financial officer of Shenzhen Guangju
Energy Co., Ltd, director and executive deputy general manager of Shenzhen Guangju Energy Co., Ltd,
and now acts as managing director of Shenzhen Guangju Energy Co., Ltd, as well as the director of
Shenzhen Nanshan Petroleum (Group) Co., Ltd.
Mr. Sun Yulin, born in 1951, vice president and senior engineer, had has successively worked as
secretary of minister of clerical office of Ministry of Water Resources and Power, deputy director general
and party secretary of China Electricity Council as well as deputy general manager, general manager and
senior engineer of Shenzhen Dianlian Power Industrial Company from 1985 to 1999; Party group
member and deputy general manager of Shenzhen State Power Technology Development Co., Ltd.,
party committee secretary and deputy general manager of State Grid Shenzhen Energy Development
Group Co., Ltd as well as deputy director of State Grid Shenzhen-based Economic Development Liaison
Office from 2000 to 2007; and deputy general manager and Party group member (bureau level) of State
Grid International Development Co., Ltd. from 2008 to 2010. And now, he is a bureau-level researcher of
State Grid International Development Co., Ltd..
Mr.. Fu Bo, managing director and MBA, born in 1962, graduated from the specialty of aero-engine,
Xi’an Air Force Engineering University, served as lecturer of aviation mechanical engineering department,
Xi’an Air Force Engineering University from 1984 to 1993, has successively worked as secretary of
general manager, vice director and director of the office, secretary of the board of directors and deputy
general manager of the Company since August 1993, has held the post of general manager of the
Company since January 2005, and now has held the concurrent posts of presidents of Shenzhen Nanshan
Power (Zhongshan) Company and Shenzhen Nanshan Power (Dongguan) Company, as well as director of
Singapore Company.
Mr. Huang Fuhan, born in 1954, director, senior engineer and master of engineering, graduated from
the specialty of thermal energy and power, Xi’an Thermal Power Research Institute, used to be the vice
director of the autoimmunization office of Xi’an Thermal Power Research Institute, has successively
worked as assistant chief engineer, vice manager and manager of Ma Bay Power Plant, Shenzhen Ma Bay
Power Company, vice manager and director of overhauling department of Power Generation Branch,
Shenzhen Energy, manager of Moon Bay Gas Turbine Power Plant, general manager of Shenzhen
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Nanshan Power Co., Ltd, manager, vice-president and vice secretary of party committee of Guangshen
Shajiao B Power Company, director of preparing office, secretary of party branch and manager of Eastern
Power Plant, Shenzhen Energy Co., Ltd, assistant general manager, chief engineer and deputy general
manager of Shenzhen Energy Co., Ltd, and now acts as deputy general manager of Shenzhen Energy Co.,
Ltd.
Miss Yu Chunling, born in 1965, director, senior engineer, on-job postgraduate of economics of
Beijing University, graduated from the specialty of power plant construction structure engineering,
Wuhan University of Hydraulic and Electrical Engineering, has successively worked as technician and
civil engineering contract engineer of engineering department of Guangdong Nuclear Power Heying Co.,
Ltd, project manager of Shenzhen Energy Investment Holding Co., Ltd, vice business director, business
director of office as well as minister of fuel trade department, minister and party branch secretary of
planning and developing department as well as director and party branch secretary of pumped-storage
preparing office of Shenzhen Energy Group Co., Ltd, and now acts as general manager of Shenzhen
Energy (Hong Kong) International Co., Ltd.
Mr. Zhou Qun, born in 1964, director, economic engineer and Bachelor of Science of East China
Institute of Technology, used to work in Shenzhen Geological Bureau, Shenzhen Nanshan Investment
Management Corporation, Shenzhen Municipal State-owned Assets Management Office and Shenzhen
Investment Management Corporation, has successively worked as assistant engineer, office director,
deputy director general, assistant minister of secretariat of board of directors, had has successively
worked as secretary of board of directors, general manager assistant and office director of Shenzhen
Energy Group Co., Ltd, preparing office director of Shenzhen Pumped-storage Power Station, president
of Huizhou City Gas Co., Ltd., president of Huizhou Fengda Power Co., Ltd, and executive director and
general manager of Shenzhen Energy Investment Holding Co., Ltd, and now holds the posts of party
committee member of Shenzhen Energy Group Co., Ltd as well as board chairman of Shenzhen Energy
Finance Co., Ltd. (revised)
Miss Chen Lihong, born in 1963, director, and accountant, graduated from junior college, has ever
worked for Shenzhen Nanshan Petroleum (Group) Co., Ltd, and Shenzhen Guangju Energy Co., Ltd as
financial manager and general manager assistant successively, and now acts as deputy general manager of
the Company. She is a supervisor of the fourth and fifth board of supervisors of Shenzhen Nanshan Power
Co., Ltd.
Mr. Jiang Xiaojun, born in 1964, director, doctoral postgraduate, senior accountant, has ever acted as
deputy manager of financial department of China Power Investment Co., Ltd. (China Power International
Co., Ltd.); manager of financial and property right management department of Shenzhen State Power
Technology Development Co., Ltd.; manager in Shenzhen Economic Development Liaison Division and
deputy chief accountant of State Power Corporation; chief accountant of Shenzhen State Power
Technology Development Co., Ltd.; chief accountant of State Grid Shenzhen Energy Development Group
Co., Ltd.; and chief accountant of State Grid International Development Co., Ltd.. He is now a deputy
general manager and Party organization member of State Grid International Development Co., Ltd.
Mr. Li Zheng, born in 1957, independent director, bachelor of law science, and practicing lawyer,
worked as full-time lawyer at Zhejiang Jinhua Law Firm in 1983; acted as senior researcher at China
(Shenzhen) Comprehensive Development and Research Institute in May 1991, and doubled as part-time
lawyer of China Legal Service Center and Shenzhen Tianping Law Firm during this period; acted as
partner and practicing lawyer of Guangdong Renren Law Firm in 1996; and has acted as practicing
lawyer of Guangdong Shentiancheng Law Firm since August 2010.
Mr. Wang Xiaodong, independent director, has dealt with law business since 1987. He obtained
attorney’s license in 1988, and the Certificate of Qualification for Lawyer to Deal with Securities Legal
Business issued by China Securities Regulatory Committee and the Ministry of Justice in 1993. Later
from May 2008 to April 2010, he acted as a member of the Tenth and Eleventh Issuance Audit Committee
under China Securities Regulatory Commission; from 1989 to 2004, he acted as lawyer and partner of
Dandong Foreign-involved, Shenzhen Xinda, Shenzhen Jingtian Law Firm, and Guangdong Bohe Law
Firm respectively; since 2005, he has been a lawyer partner of GrandHall Legal Group (Shenzhen) Law
Firm, and where, from May 2008 to April 2010, e acted as a full-time member of the Tenth and Eleventh
Issuance Audit Committee under China Securities Regulatory Commission.
Mr. Wang Junsheng, born in 1960, independent director and senior economists, began to work in
September 1978, and has ever acted as section chief of Materials Division, Asian Games Village
Department, the 11th Asian Games Organization Committee; the manager of comprehensive operation
department of Beijing International Power Development and Investment Co., Ltd.; and deputy general
manager of China Industrial Trust Investment Co., Ltd. Now, he is a researcher of China Economic and
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Technical Research and Consulting Co., Ltd., and doubles as standing director of the Society of
Management Science of China; part-time professor of the Government Management College, Central
University of Finance and Economics; part-time professor of the School of Finance and Economy, China
Renmin University; part-time professor of Financial College, Hunan University; part-time professor of
Economic Management College, Beijing University of Technology; and deputy director researcher of
Economic Research Center, National Academy of Education.
Miss Wu Xiaolei, born in 1964, independent director, doctor of economic, and ICMC, owns the
bachelor of arts, MB A and doctor of economic. She entered the capital market in 1991, has ever held the
posts of senior management in many famous listed companies and large-scale enterprise groups. She was
appointed by CMB to hold the posts of director and executive vice-president of CMB International
Capital Corporation Limited in 2005. Now, she holds the posts of deputy general manager of
Headquarters Investment Banking Division of CMB, vice-chairman of Shenzhen Association of
Management Consultants, vice-chairman of Association of Women Entrepreneurs, as well as the director
of China Reform Council.
Mr. Tang Tianyun, born in 1960, independent director and senior accountant, has ever worked as
Chinese certified public accountant at Shekou Zhonghua Certified Public Accountants. From 1991 to
2006, he successively acted as director and doubled as secretary to the board of directors, chief financial
officer and deputy general manager of Huayuan Industry (Group) Co., Ltd.; since 2007, he has acted as
director general of financial development strategy of Qingdao Haier Investment and Development Co.,
Ltd.; and since June 2009, he has successively assumed as director and senior vice president of Haier
New York Life Insurance Co., Ltd.
Mr. Pan Chengwei, born in 1946, independent director, joined in China Ocean Shipping (Group)
Company in 1965, and successively acted as general manager of the group’s financial department,
general manager of financial department of COSCO (Hong Kong) Group Co., Ltd., managing director of
COSCO (Hong Kong) Real Estate Co., Ltd, managing director of COSCO (Hong Kong) Industry and
Trade Co., Ltd., and chief representative of Shenzhen Representative Office of COSCO (Hong Kong)
Group. From 1997 to 2004, he acted as director of Shenzhen Shennan Petroleum (Group) Co., Ltd.; from
2001 to 2004, he acted as director and chief financial officer of Shenzhen Guangju Energy Co., Ltd.; and
from 2005 to 2008, he acted as managing director of COSCO (Cayman) Fuqing Co., Ltd., and doubled
as fuel futures compliance manager of COSCO. Now, he is retired.
(2) Members of the board of supervisors
Mr. Zhao Xiangzhi, born in 1958, chief supervisor and senior accountant, acted as deputy section
chief of Financial Division of State-operated No. 5127 Factory in 1990; deputy section chief (section
chief level) of Planning Division and secretary to CPC branch of State-operated No. 5127 Factory in 1992;
deputy chief accountant and section chief of financial division of China Yanxing Shenzhen Co., Ltd. In
1993-1996; chief financial officer accredited by Shenzhen Investment Management Co., Ltd. to the
Energy Group, as well as director, disciplinary committee member, director general of audit department,
and supervisor of Shenzhen Energy Group successively in 1996-2003; and manager of financial
management department of Shenzhen Energy Corporation and chairman of the board of supervisors of
Shenzhen Energy Investment Co., Ltd. in 2003-2007. Since 2007, he has acted as board chairman and
secretary to Party committee of Shenzhen Guangshen Shajiao B Power Co., Ltd., and disciplinary
committee member of Shenzhen Energy Group Co., Ltd.; and since May 2011, he has acted as chief
accountant of Shenzhen Energy Group Co., Ltd.
Miss Ma Fengming, born in 1962, supervisor, master postgraduate, senior accountant and certified
public accountant, acted as lecturer in university, practicing certified public accountant of CPA firm, and
financial principal of foreign-funded enterprise in 1989-1995; and successively acted as accountant of
Audit Supervision Department of Shenzhen Energy Corporation, manager of Financial Department of
Mawan Power Generation General Factory, director accountant of Planning Investment Department, vice
manager of Audit Supervision Department, and deputy manager of Audit Department of Shenzhen Energy
Group Co., Ltd. in 1995-2008. Now, she is an employee director and senior audit management manager
of Audit Management Department of Shenzhen Energy Group Co., Ltd.; director of Shenzhen Moon Bay
Oil and Post Affairs Co., Ltd.; supervisor of State Power Nanning Power Generation Co., Ltd.; supervisor
of Shenzhen Energy Corporation; and supervisor of Shenzhen Shenneng Energy Management Co., Ltd.
Miss Ji Yuanhong, born in 1967, supervisor and economists, worked at Shenzhen FIYTA (Group)
Co., Ltd. from July 1989 to 1999. Since August 1999, she has acted secretary to the board of directors of
Shenzhen Guangju Energy Co., Ltd.; since May 2008, she has acted as deputy general manager of
Shenzhen Guangju Energy Co., Ltd.; and since March 2012, she has acted as director of Shenzhen
Guangju Energy Co., Ltd.
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Mr. Wang Difei, born in 1968, supervisor and accountant with a bachelor degree, had has
successively worked as accountant of financial department, Zhejiang Provincial Electric Power Industry
Bureau, deputy manger of accounting department, Zhejiang Beilun Power Generation Plant, deputy
manger of State Grid Shenzhen Science and Technology Industrial Trade Company, Ningbo Branch,
deputy general manager of Guiguan Heshan Power Generation Co., Ltd of China Datang Corporation,
manger of planning development department and human resource department of State Grid Shenzhen
Science and Technology Development Co., Ltd as well as manager of the general manager working
department of State Grid Shenzhen Energy Development Group Co., Ltd, and now holds the posts of
Shenzhen business office director of State Grid International Development Limited.
Mr. Zheng Dalei, born in 1964, employee supervisor and senior engineer, graduated from the major
of Thermal Engineering Measurement and Automation of Northeast China Institute Of Electric Power
Engineering. He worked at Heilongjiang Fulaerji Power Generation General Factory, Thermal
Engineering Branch in 1985-1990; worked at Qiqihaer No. 2 Machine Tool Factory, Equipment Division
in 1990-1994; worked at Shenzhen Nanshan Power Co., Ltd. as special personnel and manager of thermal
control department, director of thermal control branch, and director of electric control branch
successively since 1994; acted as chief engineer of Shenzhen Nanshan Power Zhongshan Company in
2003-2007; and has acted as chief engineer of Nanshan Thermal Power Plant since April 2007. In 2007,
2008 and 2010, he was titled as Excellent Management Cadre of the Company respectively.
Mr. Peng Bo, born in 1973, employee supervisor, engineer, master postgraduate, graduated from
the major of Electric System Automation of Huazhong University of Science and Technology, and then
obtained the diploma of postgraduate and academic degree of master in the major of business
management from the same university. Since 1994, he has successively acted as the Company’s engineer
of gas turbine thermal control examination and repair specialty, supervisor in charge of labor and capital,
assistant to office director, and deputy manager of HR Department, etc. Since April 2007, he has acted as
Manager of HR Department. Now, he is a supervisor of the subordinated company Shenzhong Real Estate
Company. In 2007, he was titled as Excellent Management Cadre of the Company; and in 2008, he was
titled as excellent CPC member by Guangju Energy Party Committee.
Miss Li Huiwen, born in 1962, employee supervisor, accountant, graduated from the major of
Accounting, Jiangxi College of Finance and Economy. She worked at Financial Division of Nanchang
Machine Tool Repair and Manufacturing Factory in 1980-1989; and acted as chief accountant of
Shenzhen Changming Garment Manufacturing Co., Ltd. in 1989-1993. Later since 1993, she has
successively acted as principal in charge of accounting of the Financial Department of the Company, and
chief financial officer of subordinated Xiefu Company, etc. Since May 2005, she has always acted as
chief financial officer and manager of financial department of subordinated enterprise Shenzhen Nanshan
Power Dongguan Company. In 2007 and 2009, she was titled as Excellent Management Cadre of the
Company respectively.
Mr. Tao Lin, born in 1967, employee supervisor, economist and MBA, graduated from the major of
Electric System and Automation of Shanghai Jiaotong University, and later studied for MBA of Tsinghua
University. From July 1989 to February 1991, he worked at Dalian Electric Bureau; from February to
December 1991, he worked at Shenzhen Mawan Electric Power Co., Ltd. Since January 1992, he has
successively acted the Company’s office secretary, office director, secretary to the board of directors, as
well as general manager of subordinated enterprise Xiefu Company, etc. Since April 2007, he has always
acted as director and general manager of the subordinated enterprise Shenzhen Nanshan Power
Shenzhong Real Estate. In 2007, he was titled as Excellent Manager of the Company.
(3) Senior managers
Mr. Fu Bo is managing director. For details, see the previous director resume.
Miss Lin Qing, deputy general manager, born in 1964, senior engineer with a master degree,
graduated from the specialty of Power System and Its Automation of Hunan University, taught in the
Power Department, Changsha University of Science and Technology since 1985, worked in the
engineering department of Guangdong Daya Bay Nuclear Power Station since 1990, successively hold
the posts of secretary of comprehensive department and business director of general administrative office
of Shenzhen Energy Company, Shenzhen Western Power Company, minister of the party department,
official labor unit president, office director, party branch secretary of office, director of labor union office,
party committee member, and general manger assistant of Shenzhen Energy Corporation, etc, since
December 1991, and now acts as deputy general manager of the Company as well as president of Xiefu
Company.
Mr. Ji Ming, deputy general manager, born in 1956, senior engineer and master of management, was
successively graduated from Changchun University of Science and Technology as well as Fudan
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
University, held the post of Shenzhen Nanshan Petroleum (Group) Co., Ltd from 1994 to 1999, held the
posts of deputy general manger of Shenzhen Guangju Energy Co., Ltd and the general manager of
Shenzhen Guangju Power Investment Co., Ltd since 1999, held the post of deputy general manager of the
Company since December 2006, and now holds the posts of president of Shenzhong Real Estate
Company, Shenzhong Property Company, Shenzhen Nanshan Power Environmental Protection Company,
vice-president of Shenzhen Nanshan Power (Zhongshan) Co., Ltd, and Shenzhen Nanshan Power
Engineering Co., Ltd. as well as director of Singapore Company.
Miss Zhang Jie, deputy general manager, born in 1968, Master of Psychology of Beijing University,
graduated from the specialty of British and American Literature in the Foreign Language Department of
Zhengzhou University, and then studied in the specialty of applied psychology in the Psychology
Department, Beijing University, used to work in Henan Provincial Seismological Bureau as a translator,
worked in the financial department and office of the Company since October 1990, has successively
worked as secretary, office director, general manager assistant and employee supervisor of the Company
since 1993, held the post of deputy general manager of the Company since December 2006, and now
holds the posts of Shenzhen Nanshan Power (Zhongshan) Co., Ltd, Shenzhen Nanshan Power
(Dongguan) Company and Singapore Company.
Mr. Zhu Wei, deputy general manager and engineer, born in 1957, graduated from Guangdong
Electric Power School, used to work in Guangdong Xinfengjiang Power Plant; then in 1985, he studied in
Nanjing Institute of Technology and obtained a junior college degree; since 1990 he has successively
worked as assistant minister of development department, minister of supply department and general
manager assistant of the Company, obtained on-job master degree during this period; and since August
2003, he has held the post of deputy general manager of the Company.
Mr. Wang Rendong, chief engineer, born in 1961, graduated from the specialty of thermal power of
Power Department, Huazhong University of Science and Technology, and then obtained a master degree
on the specialty of economic management of Huazhong University of Science and Technology, used to
work in the planning department of Beijing Electrical Planning and Design Institute of State Ministry of
Water Resources and Power, transferred and assigned to Shenzhen Huadian Southern Development
(Group) Company in June 1988, successively held the post of minister of operating department, minister
of engineering department, assistant chief engineer, general manager assistant and employee supervisor of
the Company since 1990, held the post of chief engineer of the Company since December 2006, and now
holds the concurrent posts of president and managing director of Shenzhen Nanshan Power Engineering
Co., Ltd. , as well as director of Shenzhen Nanshan Power (Dongguan) Company and Singapore
Company.
Mr. Lu Xiaoping, chief financial officer, born in 1962, senior accountant and master of Zhongnan
University of Economics and Law, used to work in Chashi Town People’s Government, Hengyang
County, Hunan Province, Hunan Hengyang Oil and Pump Nozzle Plant as well as Shenzhen Pengji
Industrial Development Company, held the post of deputy manager of financial department of Shenzhen
Zhongshen International Corporation from 1995 to 1998, held the posts of accountant and director of
Shenzhen Energy Corporation since December 1998, and has held the post of chief financial officer of the
Company since August 2003, and now holds the concurrent posts of director of Shenzhong Real Estate
Company and Shenzhong Property Company.
Miss Hu Qin, born in 1967, secretary of board of directors, engineer and economist, graduated from
the specialty of applied chemistry in the Thermal Power Engineering Department of Wuhan University of
Hydraulic and Electrical Engineering, and then studied for a master degree in the specialty of finance in
Nankai University. She has ever acted as the counselor of Thermal Power Engineering Department of
Wuhan University of Hydraulic and Electrical Engineering (Wuhan University now); successively
worked at the engineering department, operating department, office and investment department of the
Company. Since March 2005, she has acted as secretary of board of directors as well as director of
secretariat of board of directors of the Company, and now doubles as director of New Power Company
and independent director of Shenzhen Wanxun Automatic Control Co., Ltd.
6. Annual Remuneration
According to relevant regulation of Articles of Association, the remuneration of directors and
supervisors is decided by the general meeting of shareholders and the remuneration of the senior
managers is decided by the board of directors. In the reporting period, the senior managers of the
Company all get paid in the Company.
The allowance paid by the Company to independent directors in the reporting period is as shown in
―IV. Directors, Supervisors, Senior Management Personnel and Employees‖. Related expenses incurred
by independent directors for work, including expenses for traffic, accommodation, investigation, survey
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
and meeting, etc., shall be undertaken by the Company separately.
Besides board chairman Yang Haixian, managing director Fu Bo, employee supervisors Zheng
Dalei, Peng Bo, Li Huiwen and Tao Lin who acquire remuneration from the Company, Li Hongsheng,
Sun Yulin, Huangpu Han, Yu Chunling, Zhou Qun, Chen Lihong, Jiang Xiaojun among the members of
the board of directors, as well as Zhao Xiangzhi, Ma Fengming, Ji Yuanhong, Wang Difei among the
members of the board of supervisors acquire remuneration from the Company.
Related expenses incurred by directors and supervisors for duty performance, including expenses for
traffic, accommodation, investigation, survey and meeting, etc., shall be undertaken by the Company
separately.
The pretax remuneration of the current director, Supervisor, Senior Manager in the reporting period
is 7,311,300 RMB in total.
7. Off-post and recruitment situation
(1) On Jan. 13, 2011, Mr. Wang Jianbin resigned from the posts of the Company’s vice board
chairman and director for reason of work.
(2) On May 25, 2011, at the 2nd Interim Meeting of Stockholders’ Conference in 2011, Yang Haixian,
Li Hongsheng, Sun Yulin, Fu Bo, Huangpu Han, Yu Chunling, Zhou Qun, Chen Lihong, and Jiang
Xiaojun were elected as members of the Company’s Sixth Board of Directors; Zhao Xiangzhi, Ma
Fengming, Ji Yuanhong, Wang Difei were elected as members of the Sixth Board of Supervisors, and they
formed the Company’s Sixth Board of Supervisors together with the four employee representative
supervisors elected at the Workers’ Congress on May 13, 2011.
(3) On May 25, 2011, at the 1st Meeting of the Sixth Board of Directors, director Yang Haixian was
elected as chairman of the Sixth Board of Directors; directors Li Hongsheng and Sun Yulin were elected
as vice chairman of the Sixth Board of Directors; Miss Hu Qin was employed as secretary to the Sixth
Board of Directors. At the 1st Meeting of the Sixth Board of Directors, Zhao Xiangzhi was elected as
chief supervisor of the Sixth Board of Supervisors.
(4) On July 8, 2011, at the 2nd Meeting of the Sixth Board of Directors, Mr. Fu Bo was employed as
the Company’s general manager, with an office term of three years; Miss Lin Qing, Mr. Ji Ming, Miss
Zhang Jie, and Mr. Zhu Wei were elected as the Company’s deputy general managers; Mr. Wang Rendong
was elected as the Company’s chief engineer; and Mr. Lu Xiaoping was elected as the Company’s chief
financial officer. Their office term is three years respectively.
(II) Employees
As of Dec. 31, 2011, the Company had 327 employees on payroll (excluding those from controlling
subsidiaries), slightly less than that in 2010. Specialty composition: 74 operating personnel, 64
examination and repair personnel, 18 materials supply personnel, 18 financial personnel, and 65
administrative personnel; education degree: 98 persons having education background of junior college
degree, 109 persons holding bachelor’s degree, and 27 persons holding master’s degree and above.
The Company executes the social insurance system of Shenzhen, and needs not to undertake
expenses for employees having left and retired.
V. Corporate Governance Structure
(I) Corporate governance
In the reporting period, according to the requirements of related laws and rules, like Company Law,
Securities Law, Rules for Governing Listed Companies, Administrative Measures for Information
Disclosure of Listed Companies, and Rules for Listing of Stocks with Shenzhen Stock Exchange, etc., the
Company has perfected its corporate governance structure constantly, persisted in law-abiding business
operation and management. The Company’s corporate governance structure meets the requirements of the
abovementioned laws and rules actually. In the reporting period, the Company’s governance is as shown
below:
1. Establishment of internal control system
(1) In 2011, the Company perfected its financial accounting management system according to the
requirements of related financial laws and rules, and combining with its own actual situations. In the
reporting period, the Company combed through the existing financial accounting management systems,
perfected partial accounting systems in shortage, and drafted the System of Investigating the
Responsibilities for Behaviors Violating Financial Accounting Management System, Measures for
Management of Fixed Assets, Regulations on Management of Intangible Assets, Fund Plan Management
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
System, Financial Seals Management System, and Guaranty Management System, etc., which will be
issued and executed after being examined and approved by the Company or the board of directors.
2. Special governance in reporting period
(1) According to the requirements on the Company’s reelection of the board of directors and the
board of supervisors in the Opinions of Supervision on Shenzhen Nanshan Power Co., Ltd. (SZJGSZ
[2011] No. 7) issued by Shenzhen Securities Regulatory Commission, the Company convened special
meeting of major stockholders in time, and researched and made related program for re-election of the
board of directors and the board of supervisors. On March 11, 2011, the Company held the 39th Meeting
of the Fifth Board of Directors, and deliberated and passed the Proposal on Recommending Director
Candidates for the Company’s Sixth Board of Directors. On the same date, the Company held the 32nd
Meeting of the Fifth Board of Supervisors, and deliberated and passed the Proposal on Recommending
Supervisor Candidates for the Company’s Sixth Board of Supervisors. On May 25, 2011, the Company
held the 2nd Interim Meeting of Stockholders’ Conference in 2011, elected members for the Company’s
Sixth Board of Directors and Sixth Board of Supervisors, completed the re-election of the board of
directors and the board of supervisors smoothly, and selected the board chairman and vice board chairman,
as well as the chairman and vice chairman of the board of supervisors. On July 8, at the 2nd Meeting of
the Sixth Board of Directors, the Company employed a new management team.
(2) According to the Notification on Well Performing the Work Related to Internal Control
Specification Pilots of Listed Companies in Shenzhen issued by Shenzhen Securities Regulatory
Commission, the Company has established special working body, made Plan for Implementation of
Internal Control Specification, and employed a professional consulting company by means of competitive
tendering to participate in risk evaluation and internal control system building. As of the end of 2011, the
Company has completed the internal control diagnosis, risk identification, flow sorting out, and internal
control system formulation, etc. aiming at the Company and its 9 subordinated companies involved in
consolidated financial statements, and realized the internal control specification construction flow with
―diagnosis- combing through – optimization - solidification‖ as main line; meanwhile, under the
instruction of professional consulting institution, the Company has designed internal control
self-evaluation mechanism, and developed internal control self-evaluation.
(3) According to the Notification on Examination of Shenzhen Nanshan Power Co., Ltd. issued by
Shenzhen Securities Regulatory Commission, the Company has accepted the field examination of
Shenzhen Securities Regulatory Commission in terms of corporate governance, information disclosure,
and basic financial accounting work, etc. since 2008. The Company has paid much attention to and
cooperated actively with this tour inspection, organized related special meetings and provided various
documents according to requirements. At present, the Company is rectifying the problems existing
according to the tour inspection opinions issued by Shenzhen Securities Regulatory Commission.
(4) According to the Notification on Fulfilling the Spirit of ―Special Meeting on Information
Disclosure of Listed Companies in Shenzhen‖ issued by Shenzhen Securities Regulatory Commission,
the Company organized directors, supervisors and senior managers to attend the ―Training on Preventing
and Controlling Behaviors Violating Laws and Rules Such As Inside Transaction, etc.‖ on Oct. 14, 2011,
and submitted training report and record to Shenzhen Securities Regulatory Commission after completion
of training.
(5) Problems existing and rectification measures
① Organize to fulfill rectification according to the requirements of the Opinions of Supervision on
Field Examination of Shenzhen Nanshan Power Co., Ltd. issued by Shenzhen Securities Regulatory
Commission.
② Description about reporting non-open information to the number one major stockholder
A) The Company’s production technology department sends the daily power generation to the
number one major stockholder’s power asset management department directly; after being examined and
approved by the principal of the Company’s production technology department and leader in charge, the
production technology department submits power production barrier report, accident report, and monthly
safety briefing to the number one major stockholder on the 15th day of each month.
B) According to the requirements of the Notification on Printing and Issuing Procedure Document
―Management of Property Right Representatives Dispatched by the Group‖ (SN[2009] No. 45) issued by
the number one major stockholders, before the meetings of the board of directors/ supervisors, the
secretary office under the board of directors will submit the proposals discussed and revised at the work
meeting of general manager to the directors/ supervisors dispatched by the number one major stockholder,
and meanwhile, file such proposals with its property right legal department and administrative
management department.
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
The Company has made a written commitment to Shenzhen Securities Regulatory Commission on
disclosing non-standard governance and submitting the name list of non-open information graspers.
Meanwhile, the Company’s number one major stockholder has signed the Written Commitment on
Strengthening Non-open Information Management. In the reporting period, in the precondition of
requiring related transistors to strictly fulfill the responsibility of confidentiality, the Company has filed
the information on non-open information submission and name list of non-open information graspers with
Shenzhen Securities Regulatory Commission before the 10th day each month.
(II) Duty performance of independent directors
In the reporting period, strictly in accordance with the Company Law , Rules for Governing Listed
Companies, Guiding Opinions on Establishing Independent Director System in Listed Companies,
Regulations on Strengthening the Protection of Rights and Interests of Social Public Stock Holders,
Working System of Independent Directors, etc., as well as the Articles of Association, all independent
directors of the Company have performed their duties in earnest, given full play to their functions as
independent directors, and maintained the lawful rights and interests of all stockholders, especially
plentiful medium-sized and minor stockholders.
1. Establishment and perfection of related work systems of independent directors
The Company made the Work System of Independent Directors and Work System for Annual
Report of Independent Directors of the Company in May 2002 and April 2008 respectively.
2. Duty performance of independent directors
The Company has 6 independent directors at present, exceeding 1/3 of total directors, and this meets
the requirement of Guiding Opinions on Establishing Independent Director System in Listed Companies
issued by China Securities Regulatory Committee. In the reporting period, the Company’s independent
directors have performed duties in a loyal way according to the regulations of the Working System of
Independent Directors, and Working System for Annual Report of Independent Directors, etc. They have
examined the major associated transactions and other important matters requiring the opinions of
independent directors, presented written opinions of independent directors, deliberated all the proposals
submitted to the board of directors in earnest, and voted through all the proposals.
(1) They have attended all the meetings of the board of directors held by the Company, deliberated
related proposals, and signed for confirmation of resolutions made at the meeting.
The Company has held 14 meetings of the board of directors in the present year, including 3
meetings adopting voting by communication. The information on attendance of independent directors:
Name of
Failing to attend
independent Required Actual By By
meeting personally
directors of the number of number of communicat entrusting Absent
for twice
fifth board of attendees attendees ion others
continuously or not
directors
Huang Jianxin 6 5 1 1 0 No
Zhou
6 5 1 1 0 No
Chengxin
Xu Jing’an 6 5 1 1 0 No
Yu Xiufeng 6 5 1 2 0 Yes
Wu Xiaolei 6 5 1 0 0 No
Name of
Failing to attend
independent Required Actual By By
meeting personally
directors of the number of number of communicat entrusting Absent
for twice
sixth board of attendees attendees ion others
continuously or not
directors
Li Zheng 8 6 2 0 0 No
Wang
8 6 2 0 0 No
Xiaodong
Wang
8 6 2 0 0 No
Junsheng
Wu Xiaolei 8 6 2 1 0 No
Tang Tianyun 8 6 2 1 0 No
Pan Chengwei 8 6 2 1 0 No
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Independent director Yu Xiufeng failed to attend the 40th and 41st Meetings of the Fifth Board of
Directors personally for reason of business, and authorized independent director Zhou Chengxin to attend
and exercise voting power on behalf of him.
(2) Independent directors have participated in the auditing of the Company’s annual report actively,
and brought forward precious opinions and suggestions on the compilation of annual report.
(3) Independent directors have issued independent opinions on the Company’s internal control
self-evaluation, external guaranty, and associated transactions, etc. in 2011.
(4) Independent directors have paid close attention to progress of the contract for oil options, made
necessary solutions to coping with jurisdiction when requiring the Company to seek for settlement
through negotiation, and fulfilled the obligation of information disclosure in earnest according to the
requirements of regulatory department at all levels.
(III) Separation of the Company from the number one major stockholder in terms of business,
asset, personnel, institution, and financial affairs, etc. in the reporting period
The Company’s number one major stockholder exercises its rights as an investor through
stockholders’ conference according to laws. The Company is completely separated from the number one
major stockholders in terms of business, asset, personnel, institution, and financial affairs, etc., and owns
independent and complete ability of business and autonomous operation.
1. In terms of business, the Company is completely independent of the number one major
stockholder. The number one major stockholder and its subordinated units deal wit business same as or
similar to that of the Company, but are completed separated from the Company in business operation and
management.
2. In terms of asset, the Company’s assets are independent and integrate, and the ownership of which
is clear. In the reporting period, the number one major stockholder did not occupy or dominate the
Company’s assets, or interment the Company’s operation and management of assets.
3. In terms of personnel, the Company’s personnel are independent of that of number one major
stockholder. The Company’s management personnel, financial principal and secretary to the board of
directors don’t assume any post at the number one major stockholder’s unit.
4. In terms of institution, the Company’s board of directors, board of supervisors, and other internal
institutions operate independently. Number one major stockholder and its functional departments don’t
have superior-inferior relationship with the Company and its functional departments, have never sent any
business-related plan and command to the Company and its subordinated institutions, or affect the
independent operation and management of the Company and its subordinated institutions in any form.
5. In terms of financial affairs, the Company has established and perfected financial and accounting
management systems, and executed independent accounting according to the requirements of related laws
and rules. The Company’s number one major stockholder has not intervened the Company’s financial and
accounting activities.
(IV) Assessment and excitation mechanism for senior management personnel
In the reporting period, the Company’s board of directors has still adopted the proposal of
rewarding and punishment linked with business performance, etc. for assessing and exciting senior
management personnel.
(V) Self-evaluation on the Company’s internal control
For details, please refer to the Self-evaluation Report on Internal Control disclosed by the Company
at www.Cninfo.com.cn. Conclusion:
According to the regulations and requirements of the Basic Specifications for Enterprises’ Internal
Control and its supporting directions, and combining with daily supervision and special supervision, the
Company’s present internal control system could basically meet the Company’s management
requirements and development demand, ensure the authenticity, legality, and integrity of the Company’s
accounting documents; and provide effective guarantee for the safety and integrity of the Company’s
properties. The Company could file and disclose related information in an authentic, correct, integrate and
timely way according to the information disclosure contents and format regulated in related laws, rules
and articles of association.
In the reporting period, the Company has obtained certain achievements in internal control, but still
has space for improvement in terms of corporate governance, accounting, and information disclosure, etc.
Next step, we will hammer at the following work:
(I) Perfect the internal control system continuously, and execute related internal control systems
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
strictly according to the requirements of the Basic Specifications for Enterprises’ Internal Control and
related documents; revise and perfect the Company’s internal control systems, optimize business flow,
and improve the internal control systems continuously according to the changes in related laws and rules
as well as upon the demand of the Company’s development in time.
(II) Take effective actions to further strengthen the normalization and standardization of related
accounting of financial statements, make definite accounting policies meeting the Company’s actual
situations, and perfect related departments’ responsibility of instruction and supervision.
(III) Strengthen the examination and supervision on fulfillment of internal control systems, execute
normative operation continuously, and rectify any defect discovered in time; strengthen the learning and
training of internal control specifications and systems, raise the executive force, further prevent and
control risks, and promote the sustained and healthy development of the Company.
VI. Brief Introduction to Stockholders’ Conference
In the reporting period, the Company held six interim meetings of stockholders’ conference, and
2010 annual meeting of stockholders’ conference, as shown below:
(I) The 1st interim meeting of stockholders’ conference 2011
On Jan. 13, 2011, the Company held the 1st interim meeting of stockholders’ conference 2011. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on Jan. 14, 2011 (the specified newspapers
for the Company’s information disclosure: China Securities Journal, Securities Times and Hong Kong
Commercial Daily; Internet website specified by China Securities Regulatory Commission:
http://www.cninfo.com.cn, same below).
(II) The annual meeting of stockholders’ conference 2011
On May 10, 2011, the Company held the annual meeting of stockholders’ conference 2010. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on May 11, 2011.
(III) The 2nd interim meeting of stockholders’ conference 2011
On May 25, 2011, the Company held the 2nd interim meeting of stockholders’ conference 2011. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on May 26.
(IV) The 3rd interim meeting of stockholders’ conference 2011
On July 27, 2011, the Company held the 3rd interim meeting of stockholders’ conference 2011. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on July 28, 2011.
(V) The 4th interim meeting of stockholders’ conference 2011
On Sept. 30, 2011, the Company held the 4th interim meeting of stockholders’ conference 2011. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on Oct. 1, 2011.
(VI) The 5th interim meeting of stockholders’ conference 2011
On Oct. 14, 2011, the Company held the 5th interim meeting of stockholders’ conference 2011. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on Oct. 15, 2011.
(VII) The 6th interim meeting of stockholders’ conference 2011
On Dec. 18, 2011, the Company held the 6th interim meeting of stockholders’ conference 2011. The
resolutions of this meeting were published at the Company’s specified newspapers, and discloses at the
website specified by China Securities Regulatory Commission on Dec. 20, 2011.
VII. Report of the Board of Directors
(I) Retrospection upon the Company’s business operation in the reporting period
The Company’s business scope covers production and operation of power supply and heat supply, as
well as related technical consulting and technical services for power plants (stations). The Company owns
three solely-funded or controlling gas turbine power plants in Shenzhen, Zhongshan and Dongguan, and
the three power plants are all the main power sources in central electric charge areas in Pearl River Delta;
meanwhile, the Company has participated in the investment and construction of nuclear power projects.
In 2011, under the circumstances that the reform of 9E gas-turbine electric rate reform of
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Guangdong Province was not completed yet, the power generation cost and grid-connected electric rate
were still in serious reverse position, the provincial and municipal electric rate subsidy was in serious
lagging state, and the national energy-conservation and environmental-protection policies became
increasingly strict, the Company was faced with the austere situation of suffering from loss once again.
The new board of directors put forward the objectives of ―surely preventing the Company from loss‖ and
―ensuring the safety of the Company’s capital chain‖, and required the Company to organize the
fulfillment of such objectives comprehensively. Under the great supports of stockholders, and after joint
efforts of the whole staff, the Company realized in 2011 the sales income of 2,415,817,700 Yuan (RMB,
same below), non-operating income of 1,516,790,900 Yuan, gross profit of 22,255,800 Yuan, and net
profit attributed to the parent company of 17,529,100 Yuan; completed the business objective of turning
loss into profit in 2011, and guaranteed the Company’s survival and development.
In the reporting period, the Company has completed power generation of 3.732 billion kwh
accumulatively, increased by 39.62% over the same period of last year, and completed 107.52% of annual
planned index. Where, Nanshan Thermal Power Factory (including New Power) completed power
generation of 2.094 billion kwh (totally power generation with natural gas as fuel), increased by 17.05%
over the same period of last year; the grid-connected electricity was 2.041 billion kwh, accounting for
48.16% of Shenzhen low-voltage thermal power adjustment, and around 25% market share of this
factory’s installed capacity; Shenzhen Nanshan Power Zhongshan Company completed power generation
of 818 million kwh, increased by 1473.08% over the same period of last year; ShenNan Dongguan
Company completed power generation of 820 million kwh, decreased by 1.44% over the same period of
last year.
As of Dec. 31, 2011, the Company’s consolidated gross assets reached up to 5452746700 Yuan,
increased by around 3.29% over the beginning of year; the Company’s stockholders’ equity was
1887811000 Yuan, and where, the stockholders’ equity attributed to the parent company was 1753371600
Yuan, decreased by around 2.31% over the previous year.
In 2011, the Company realized sales income of 2415817700 Yuan, increased by 50.83% over the
previous year; non-operating income of 1516790900 Yuan, and gross profit of 22255800 Yuan, increased
by 120901500 Yuan over the previous year; the net profit attributed to the parent company of 17529100
Yuan, increased by 132167800 Yuan over the previous year, mainly due to the increase of power
generation and income from reimbursement of tax for purchasing of natural gas, as well as income from
transfer of stock equity in Jiangxi Xinchang Company and Energy Environmental Protection Company,
with earning per share of 0.03 Yuan, increased by 0.22 Yuan over the previous year.
2. Composition of operating income and operating profit in reporting period
(Unit: Ten thousand Yuan)
Increase or Increase or Increase or
decrease of decrease of decrease of
Gross operating operating gross
By industry or Operating Operating
interest income cost over profit rate
product income cost
rate (%) over the the over the
previous previous previous
year (%) year (%) year (%)
Electric power
217,665.47 337,708.27 -55.15 39.51 52.79 -13.48
production
Heating power
833.84 1,325.15 -58.92 -23.81 -10.95 -22.94
production
Project
5,255.68 3,782.39 28.03 117.46 267.51 -29.39
contracting
Sludge treatment 2,792.93 1,491.78 46.59 - - -
Others 15,033.85 14,662.85 2.47 2,227.76 3,596.21 -36.26
(Unit: Ten thousand Yuan)
Increase or decrease of operating
By area Operating income income over the previous year
Shenzhen 143,882.81 26.40
Zhongshan 48,781.53 1,456.46
Dongguan 46,072.35 8.25
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Abroad 2,845.08 3,377.05
3. Main suppliers and customers
The Company’s core business is power production. The main raw materials for power generation are
natural gas, and spare products and parts for equipment maintenance, etc. In 2011, the gross purchasing
amount of the Company’s top five suppliers was 3390623000 Yuan, accounting for 97.47% of annual
gross purchasing amount. In Shenzhen, the Company’s gross sales amount of power was 1299467000
Yuan, and the electric power was completely sold to Guangdong Grid Corporation Shenzhen Power
Supply Bureau; in Zhongshan, the gross sales amount of power was 458628100 Yuan, and the electric
power was completely sold to Guangdong Grid Corporation; in Dongguan, the gross sales amount of
power was 418284200 Yuan, and the electric power was completely sold to Guangdong Grid Corporation.
4. Financial condition
(1) Changes of asset-liability structure in the reporting period
(Unit: Yuan)
Dec. 31, 2011 Dec. 31, 2010 Growth rate of
Item Proportion among Proportion among proportion among
Amount Amount total assets %
total assets % total assets %
Total assets 5,452,746,682.91 5,278,954,349.90
Monetary fund 695,095,052.12 12.75 601,386,814.04 11.39 1.36
Accounts
receivable 934,640,019.03
17.14 518,392,276.69
9.82 7.32
Advance payment 31,576,397.23 0.58 13,529,901.89 0.26 0.32
Other accounts
receivable 124,599,842.72
2.29 20,450,149.23
0.39 1.90
Inventory 1,258,195,597.25 23.07 1,352,372,212.06 25.62 -2.55
Long-term equity
investment 37,315,000.00
0.68 306,208,274.30
5.80 -5.12
Fixed assets 2,227,103,579.26 40.84 2,169,226,270.73 41.09 0.25
Construction in
progress 46,866,969.48
0.86 196,729,476.64
3.73 -2.87
Intangible assets 63,807,538.62 1.17 64,236,931.51 1.22 -0.05
Short loan 3,265,824,953.89 59.89 3,112,400,000.00 58.96 0.93
Notes payable 43,820,200.00 0.80 0.80
Accounts payable 214,748,889.66 3.94 61,115,438.61 1.16 2.78
Taxes payable -521,900,793.90 -9.57 -501,193,418.09 -9.49 -0.08
Other accounts
payable 358,597,380.00
6.58 288,768,647.34
5.47 1.11
Long-term loan 26,000,000.00 0.48 186,000,000.00 3.52 -3.04
(1) Monetary fund increased over the beginning of year, mainly because of many cash inflows from
operating activities and investment activities in the present year;
(2) Accounts receivable increased over the beginning of year, mainly because of increase of
subsidies receivable;
(3) Advance payment increased over the beginning of year, mainly because of the increase of
advance payment or purchasing natural gas;
(4) Other accounts receivable increased over the beginning of year, mainly because of the accounts
receivable for transfer of stock equity in Jiangxi Xinchang Company in the present year;
(5) Inventory decreased over the beginning of year, mainly because of disposal of fuel oil in the
present year;
(6) Long-term equity investment decreased over the beginning of year, mainly because of the
transfer of stock equity in Jiangxi Xinchang Company and Energy Environmental Protection Company in
the present year;
(7) Fixed assets decreased over the beginning of year, mainly because of the increase of fixed assets
in the present year;
(8) Construction in progress decreased over the beginning of year, mainly because of that sludge
drying project is transferred into fixed assets in the present year;
(9) Short loan increased over the beginning of year, mainly because of the increase of bank loans;
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
(10) Notes payable increased over the beginning of year, mainly because of the new bills opened in
the present year;
(11) Accounts payable increased over the beginning of year, mainly because of the increase of
accounts payable for fuel gases in the present year;
(12) The balance of taxes payable in the present year was negative, mainly because of the increase of
VAT payable debit amount;
(13) Other accounts payable increased over the beginning of year, mainly because of the increase of
construction cost payable;
(14) Long-term loan decreased over the beginning of year, mainly because of the decrease of
long-term loans in the present year.
(2) Changes in financial data like operating expenses, management expenses, financial costs, and income
tax, etc. in the reporting period
(Unit: Yuan)
Item
2011 2010 Increase/ decrease ratio %
Operating expense 818,301.34 860,503.71 -4.90%
Management expense 97,538,885.64 95,926,428.20 1.68%
Financial costs 204,297,949.90 128,297,803.98 59.24%
Loss on asset depreciation 23,521,935.10 11,194,836.04 110.11%
Increase by RMB
Return on investment
23,329,325.70 -49,130,454.11 51,459,800 Yuan
Non-operating income 1,516,790,851.26 832,316,848.06 82.24%
Non-operating expenditure 5,225,709.23 573,905.21 810.55%
Income tax 13,224,142.33 24,787,762.05 -46.65%
[Note] Main reasons for changes over the previous year:
(1) Financial costs increased over the previous year, mainly because of the increase of interest
expenditure in the present year;
(2) Loss on asset depreciation increased over the previous year, mainly because of the increase of
inventory depreciation reserve and fixed asset depreciation reserve in the present year;
(3) Return on investment increased over the previous year, mainly because of the transfer of stock equity
in Jiangxi Xinchang Company and Energy Environmental Protection Company in the present year;
(4) Non-operating income increased over the previous year, mainly because of the increase of income
from the fuel subsidies and reimbursement of VAT for import of natural gas;
(5) Non-operating expenditure increased over the previous year, mainly because of the increase of fixed
assets retired in the present year.
(6) Income tax decreased over the previous year, mainly because of the decrease of carry back of deferred
income tax asset in the present year.
(3) Change of financial data about cash flow of the Company in the reporting period
(Unit: Yuan)
2011 2010 Increase or
decrease
Structure Structure percent of
Item
Amount proportion Amount proportion structure
% % proportion
%
Cash inflow from operating
activities 3,958,355,123.14 44.96 2,688,135,460.20 40.07 4.89
Where: Cash received from
selling commodities and
providing labor services 2,862,823,434.28 72.32 2,288,118,410.70 85.12 -12.80
Cash outflow from operating
activities 3,686,069,781.88 42.05 2,662,237,515.23 41.12 0.93
- 24 -
Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Where: Cash paid for
purchasing commodities and
receiving labor services 3,458,138,395.82 93.82 2,398,061,926.94 90.08 3.74
Net cash flow from operating
activities 272,285,341.26 717.82 25,897,944.97 11.02 706.80
Net cash flow from
investment activities 72,743,109.23 191.77 -165,100,769.06 -70.25 262.02
Net cash flow from financing
activities -306,341,205.69 -807.60 374,701,759.98 159.43 -967.03
In 2011, the Company’s consolidated net cash flow was 37932200 Yuan, where,
The net cash flow from operating activities was 272285300 Yuan. Precisely, the cash inflow from
operating activities was 3958355100 Yuan, including 2862823400 Yuan received from electric rate
income and providing labor services, 870805700 Yuan received from fuel subsidy income, and
214622900 Yuan received from reimbursement of VAT for import of natural gas, etc.; in addition, the cash
outflow from operating activities was 3686069800 Yuan, including 3458138400 Yuan paid for raw
materials and labor services received, 122494600 Yuan paid to employees, and 85020700 Yuan for
payment of various taxes, etc.
The net cash flow from investment activities was 72743100 Yuan. Precisely, the cash inflow from
investment activities was 239592100 Yuan, including 110682600 Yuan received as fee for transfer of
stock equity in Jiangxi Xinchang Company, 123078900 Yuan received as fee for transfer of stock equity
in Energy Environmental Protection Company, and 5830600 Yuan received from disposal of assets; in
addition, the cash outflow from investment activities was 166849000 Yuan, including 118968000 Yuan
paid for investing in the projects like DLN low-nitrogen combustion reconstruction, sludge drying, and
cycling economy composite, etc., and 47881000 Yuan paid for capital increase of Shenzhen Nanshan
Power Environmental Protection Company at the beginning of year.
The net cash flow from financing activities was -306341200 Yuan, mainly because of the repayment
of bank loans and the increase of financing cost.
5. Business operation and achievements of main controlling companies and equity-participation
enterprises
(1) New Power Company: Its main business scope covers afterheat utilization technology
development, and power generation with afterheat, its registered capital is 113.85 million Yuan, and the
Company holds 75% shares in it. On Dec. 31, 2011, this company’s gross asset was 1270568800 Yuan,
increased by 41.33% over the beginning of year; the net asset was 185330300 Yuan, decreased by 1.58%
over the beginning of year. In 2011, this company realized income from main businesses of 404234100
Yuan, decreased by -44.77% over the previous year; and the net profit was -2971500 Yuan.
(2) Shenzhen Nanshan Power Zhongshan Company: Its main business scope covers gas turbine
power generation, afterheat power generation, power supply and heat supply (excluding heat supply
pipeline) projects, its registered capital is 396.80 million Yuan, and the Company holds 55% shares of it.
On Dec. 31, 2011, the Company’s gross asset was 1119126300 Yuan, increased by 13.74% over the
beginning of year; the net asset was -197105000 Yuan, decreased by 45.21% over the beginning of year.
In 2011, the Company realized income from main businesses of 487815300 Yuan, decreased by 2.41%
over previous year; and the loss was -61371200 Yuan, decreased by 57.66% over the previous year,
mainly due to clean energy transportation of ―oil altered into gas‖ and the great decrease in overhaul of
generator sets and power generation.
(3) Shenzhen Nanshan Power Dongguan Company: Its main business scope covers gas turbine
power generation, afterheat power generation, and power supply, etc., its registered capital is USD35.04
million, and the Company holds 70% shares of it. On Dec. 31, 2011, the Company’s gross asset was
1155502300 Yuan, decreased by 2.31% over the beginning of year; the net asset was 323148400 Yuan,
decreased by 33.66% over the beginning of year. In 2011, the Company realized income from main
businesses of 460723500 Yuan, increased by 8.25% over previous year; and the net profit was 14969600
Yuan, decreased by 70.49% over the previous year.
(4) Shenzhen Nanshan Power Engineering Co., Ltd.: Its main business scope covers technical
consulting service of fuel gas- steam combined circular power plant (station) construction engineering,
and examination & repair and maintenance of operating equipment of fuel gas-steam combined circular
power plants (stations), its registered capital is 10 million Yuan, and the Company holds 60% shares of it.
On Dec. 31, 2011, the Company’s gross asset was 170279300 Yuan, decreased by 2.37% over the
beginning of year; the net asset was 58635600 Yuan, decreased by 58.28% over the beginning of year. In
2011, the Company realized income from main businesses of 54715800 Yuan, increased by 122.70% over
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
previous year; and the net profit was11868300 Yuan, decreased by 23.80% over the previous year.
(5) Xiefu Company: Its main business scope covers the purchasing and sale of diesel oil, heavy oil
and lubricating oil, its registered capital is 53.30 million Yuan, and the Company holds 50% shares of it.
On Dec. 31, 2011, the Company’s gross asset was 101959300 Yuan, decreased by 1.67% over the
beginning of year; the net asset was 84719900 Yuan, increased by 2.18% over the beginning of year. In
2011, the Company realized income from main businesses of 35992300 Yuan, decreased by 29.61% over
previous year; and the net profit was 1697200 Yuan, increased by 5.82% over the previous year.
(6) Shenzhong Real Estate Company: Its main business scope covers real estate development, realty
management, sale of self-possessed commodities, rental, and real estate investment, etc., and the
Company holds 75% shares of it. On Dec. 31, 2011, the Company’s gross asset was 1055633500 Yuan,
increased by 0.87% over the beginning of year; the net asset was 81288600 Yuan, increased by 1.23%
over the beginning of year. In 2011, the Company realized gross profit of 985100 Yuan.
(7) Shenzhong Real Estate Company: Its main business scope covers real estate development, realty
management, sale of self-possessed commodities, rental, and real estate investment, etc., and the
Company holds 75% shares of it. On Dec. 31, 2011, the Company’s gross asset was 136167300 Yuan,
increased by 0.63% over the beginning of year; the net asset was 69432600 Yuan, decreased by 9.7% over
the beginning of year. In 2011, the Company realized gross profit of -7456000 Yuan.
(8) Shenzhen Nanshan Power Environmental Protection Company: Its main business scope covers
cycling economy operation and sludge drying project, its registered capital is 97 million Yuan, and the
Company holds 70% shares of it. On Dec. 31, 2011, the Company’s gross asset was 155503600 Yuan, the
net asset was 74650400 Yuan, and financial cost was 4161500 Yuan. In 2011, the Company realized gross
profit of -3716700 Yuan.
(II) Prospect on Future Development
1. Business environment analysis
In 2012, China suffers from greater pressure of downward economic growth, so does Guangdong
Province. The growth rate of GDP drops back from 10% in 2011 to 8.5%. The growth rate of industrial
electricity consumption of the whole province is estimated to drop from 10.7% in 2011 to 6.6%, and the
space is limited for power generation enterprises to relieve operation pressure by dint of the growth in
electricity quantity. The power generation cost of 9E combustion engine and the electricity rate are still in
reverse position, the deep-layer conflicts like electricity price formation mechanism, etc. are not solved
thoroughly, and demand of grids on peak power generation has dropped greatly, so the Company is still
faced with extremely austere operation environment.
However, along with the stable and rapid growth of our economy, China has taken accelerating the
cultivation of strategic emerging industries as pioneering and pillar industries, and provided opportunities
for power generation industry to solidify and expand the industrial advantages of energy conservation and
environmental protection, etc. As one of the national second batch of cycling economic pilot units, the
Company’s subordinated company Nanshan Thermal Power Factory will raise its profit-making level by
making the best of cycling economic projects with obvious effect of comprehensive energy utilization,
such as cooling-heating-power supply, and sludge drying, etc. Dongguan Gaobu Power Plant and
Zhongshan Nanlang Power Plant will accelerate the construction of thermal-electricity generation after
completing oil-altered-to-gas engineering of generator sets, and further raise the Company’s core
competitiveness. Meanwhile, along with China’s recovery of examination and approval on nuclear power,
Jiangxi Pengze Nuclear Power Project participated by the Company will optimize the Company’s
industrial structure, and create conditions for the Company’s sustainable development.
2. Key work in 2012
In the face of the extremely difficult operation situation this year, the key point for ensuring the
Company’s stable and sustained operation in 2012 is to lower the cost effectively, control various
expenditures strictly, ensure the safety of funds, and strive for timely realization of subsidies and tax
preferences. So, the Company will focus on the following work in 2012:
(1) Strengthening comprehensive safety governance, and ensuring the overall safety of the
Company
Year 2012 is the Company’s year of normalized environmental protection management. The
Company must persist in the guideline of ―safety first, prevention prevailing, and comprehensive
governance‖ in safety work, firmly set up the concept of ―people based, and safety development‖,
strengthen the enterprise’s responsibility as safety production entity, further build up high-efficiency and
perfect safety management and control system, raise the systemization, normalization and standardization
level of safety work, realize safe and environmental-protection production, and provide important
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
guarantee for the Company’s production operation and sustainable development.
(2) Accelerating the adjustment and optimization of industrial structure, raising the
profit-making level, and the ability of survival and sustainable development
As one of the national second batch of cycling economic pilot units, the Company has formed the
industrial chain of comprehensive cascade energy utilization along with that sludge drying project and
cooling-heating-power supply demonstration project are put into commercial operation successively. In
2012, the Company will accelerate structure adjustment and optimization, strengthen supply guarantee
ability, construct a safe, stable, economical and clean system of modern energy industry, and raise the
profit-making level and sustainable development ability.
(3) Strengthening financial budget, fulfilling the preferential policies of allowance for power
generation and tax reimbursement for natural gas, and ensuring the safety of capital chain
Ensuring the safety of capital chain is still one of the important works in the Company’s operating
activities in 2012. The Company will make effort to expand financing channel, strengthen uniform
management of capital in the system, and get done with risk monitoring in advance. Meanwhile, the
Company will strengthen budgetary management continuously, control expenditure of cost strictly,
strengthen the dunning for electricity rate subsidies and tax preferences, and relieve capital pressure.
(4) Optimizing the Company’s normative governance, and further raising the Company’s
governance level
In 2012, according to the requirements of supervision on listed companies, the Company will boost
the internal control construction actively, further optimize normative management, and raise its overall
governance level. The Company will get done with the Company’s inside transaction prevention and
control practically, establish and perfect financial principal management system, complete the internal
control construction related to financial reports on time, and disclose self-evaluation report in semi-annual
report 2012 according to requirements of Shenzhen Securities Regulatory Commission. Meanwhile,
according to the Supervision Opinions on Field Examination of Shenzhen Nanshan Power Co., Ltd.
(SZJGSZ [2012] No. 21) issued by Shenzhen Securities Regulatory Commission, the Company will
organize rectification aiming at some non-normative behaviors of the Company in terms of corporate
governance, information disclosure, internal control, financial management, and accounting since 2008,
and ensure the effective execution of resolutions made by stockholders’ conference and board of
directors.
(III) Investments
1. Investment of funds raised
In the reporting period, the Company didn’t raise fund, and didn’t have the situation that the fund
raised before the reporting period was extended to use in the reporting period.
2. Investment of non-raised funds
None.
(IV) Description of the board of directors about the items not involved in non-standard audit
report of CPA Firm
In 2011, for the Contract for Options of Oil Products signed by and between the Company and Jierun
(Singapore) Private Corporation (―Jierun Corporation‖) in March 2008, the auditor presented an audit
report with qualified opinions on emphasized matters (for matters involved, please refer to ―IX. Important
Matters (VII) Major Contracts and Implementation --- 5. The Company’s major disputes in the reporting
period).
Based on the legal opinions of independent practicing lawyer on the abovementioned matter, the
board of directors considers that, 1) two confirmation letters and transaction have been terminated by both
parties; 2) the Company does not know any information on or basic evidence proving that the disputes on
the contract for options have been submitted to judicial procedures, there are many uncertain factors in
the progress of this matter, and it’s unavailable to estimate the subsequential development progress,
amount of loss, and possible result of the disputes on the contract for options; and 3) whereas the final
result cannot be estimated reasonably and reliably, the estimated liability shall not be confirmed in the
financial statements 2011.
The matter involved in non-standard qualified opinion does not obviously violate the regulations of
accounting standard, systems and related information disclosure specifications.
The Company will follow up the treatment of this matter, and maintain stockholders’ rights and
interests practically. The Company’s board of directors will check the abovementioned stand point and
related accounting treatment in time according to related progress of this matter. Also, the Company will
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
implement the obligation of information disclosure in time aiming at the progress of the abovementioned
matter.
(V) Daily work of the board of directors
1. Meetings
In the reporting period, the board of directors held 14 meetings in total, as shown below:
(1) On Jan. 13, 2011, the Company organized to hold the interim meeting of the fifth board of
directors. The resolutions of this meeting were published at the Company’s specified newspapers, and
discloses at the website specified by China Securities Regulatory Commission on Jan. 15, 2011 (the
specified newspapers for the Company’s information disclosure: China Securities Journal, Securities
Times and Hong Kong Commercial Daily; Internet website specified by China Securities Regulatory
Commission: http://www.cninfo.com.cn, same below).
(2) On Mar. 11, 2011, the Company organized to hold the 39th meeting of the fifth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on May 4, 2011.
(3) On Apr. 13, 2011, the Company organized to hold the 31st meeting of the fifth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Apr. 15, 2011.
(4) On Apr. 21, 2011, the Company organized to hold the 41st meeting of the fifth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Apr. 23, 2011.
(5) On Apr. 28, 2011, the Company organized to hold the interim meeting of the fifth board of
directors (voting by communication). The resolutions of this meeting were published at the Company’s
specified newspapers, and discloses at the website specified by China Securities Regulatory Commission
on Apr. 30, 2011.
(6) On May 20, 2011, the Company organized to hold the 42nd meeting of the fifth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on June 3, 2011.
(7) On May 25, 2011, the Company organized to hold the 1st meeting of the sixth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Aug. 17, 2011.
(8) On July 8, 2011, the Company organized to hold the 2nd meeting of the sixth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Oct. 16, 2011.
(9) On Aug. 5, 2011, the Company organized to hold the 3rd meeting of the sixth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Aug. 9, 2011.
(10) On Sept. 8, 2011, the Company organized to hold the 4th meeting of the sixth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Sept. 14, 2011.
(11) On Sept. 26, 2011, the Company organized to hold the interim meeting of the sixth board of
directors (voting by communication). The resolutions of this meeting were published at the Company’s
specified newspapers, and discloses at the website specified by China Securities Regulatory Commission
on Sept. 28, 2011.
(12) On Oct. 14, 2011, the Company organized to hold the 5th meeting of the sixth board of directors.
The resolutions of this meeting were published at the Company’s specified newspapers, and discloses at
the website specified by China Securities Regulatory Commission on Oct. 15, 2011.
(13) On Oct. 19, 2011, the Company organized to hold the 6th meeting of the sixth board of directors
(voting by communication). The resolutions of this meeting were published at the Company’s specified
newspapers, and discloses at the website specified by China Securities Regulatory Commission on Oct.
21, 2011.
(14) On Dec. 1, 2011, the Company organized to hold the 3rd interim meeting of the sixth board of
directors (voting by communication). The resolutions of this meeting were published at the Company’s
specified newspapers, and discloses at the website specified by China Securities Regulatory Commission
on Dec. 3, 2011.
2. Execution of the resolutions of stockholders’ conference
In the reporting period, the Company’s board of directors has developed the following work
successively according to related resolutions of stockholders’ conference: (1) providing guaranty for the
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
loans of its subordinated enterprises, etc.; (2) establishing a new board of directors and board of
supervisors, and completing the re-election work; (3) paying remuneration for the year 2010 to audit
institution; (4) employing audit institution for the year 2011; (5) transferring 10% stock equity in
Shenshen Energy Environmental Protection Company; and (6) transferring 30% stock equity in CPI
Jiangxi Xinchang Power Generation Co., Ltd.
3. Duty performance report of audit committee
In the reporting period, according to the requirements of supervisory institution as well as the
Company’s Detailed Rules for Implementation of Audit Committee, and Regulations on Annual Report of
Audit Committee, the Company’s audit committee under the board of directors has implemented its duty
in earnest, assisted the board of directors to do work, and deliberated the Company’s audit report in the
reporting period as well as employment of CPA Firm, etc. Now, the work of audit committee is
summarized as follows:
(1) In the reporting period, the audit committee held 3 meetings in total.
(2) Audit the Company’s financial information, and supervise and urge the auditing of annual report.
①In the reporting period, the Company’s audit committee and the annual audit institution Deloitte
Touche Tohmatsu CPA Ltd negotiated with each other on important matters in auditing of financial
statements 2010, and communicated with each other on the financial auditing problems encountered in
work item by item. Meanwhile, the audit committee required the Company to get done with the annual
audit 2010 strictly according to the requirements of supervisory department on list companies’
compilation of annual report 2010, and to do various works for disclosure of annual report according to
the schedule determined by Shenzhen Stock Exchange.
② Listen to and agree with the communication of Deloitte Touche Tohmatsu CPA Ltd with the
governance level on the audit report 2010 at the audit completion stage.
③ Audit and agree with Audit Report 2010 (not signed) and the Special Description about
Presenting the Audit Report with Qualified Opinions on Emphasized Matters of Shenzhen Nanshan
Power Co., Ltd., and agree to submit them to the Company’s board of directors for discussion.
(3) Bring forward proposal on continuous employment or replacement of audit institution.
It’s proposed to employ Deloitte Touche Tohmatsu CPA Ltd as the Company’s audit institution for
year 2011 continuously.
(4) Deliberate the internal audit and internal control plan 2011.
The audit committee has deliberated and agreed with the Company’s Plan for Internal Audit and
Control 2011, which requires the Company to carry out independent and objective examination,
supervision and evaluation on the authenticity, legality and efficiency of the financial revenue and
expenditure, economic activities, and economic matters of each functional department and subordinated
controlling enterprise. In terms of internal control, according to the requirements of Shenzhen Securities
Regulatory Commission, the Company shall complete implementation of internal control in regulated
time, employ professional consulting organ to participate in risk evaluation and internal control system
building, complete internal control evaluation, and improve the internal control system continuously.
(5) Deliberate the proposal on remuneration for audit institution 2011.
Whereas the rise of Chinese CPI in recent years and the corresponding increase of audit work
quantity in 2011, the audit committee has agreed to increase the auditing fee for year 2011 after careful
analysis and investigation.
(6) Deliberate the proposal on terminating the Measures for Managing the Outlay of the Board of
Directors.
Whereas some contents of the Company’s Measures for Managing the Outlay of the Board of
Directors don’t meet related regulations, audit committee has agreed to terminate it after discussion at the
meeting held on April 13, 2011, and has submitted the opinion to the board of directors for deliberation.
4. Duty performance report of remuneration and assessment committee
In the reporting period, the remuneration and assessment committee has developed work actively,
performed duties in earnest, held special meetings to deliberate the Proposal on Remuneration
Withdrawal and Assessment 2011 and the Duty Performance Report of Remuneration and Assessment
Committee, and heard the Report on Execution of Remuneration Withdrawal and Assessment Program
2010. The remuneration and assessment committee considers that, the execution of remuneration in 2010
and the proposal on remuneration withdrawal 2011 meet the overall principle determined by the board of
directors.
Also, the remuneration and assessment committee has also audited the remuneration of the
Company’s directors, supervisors and senior management personnel, and considered that, the Company’s
payment of remuneration to directors, supervisors and senior management personnel in the present year
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
according to the remuneration withdrawal principles and payment standards determined by the board of
directors for the year 2010 meets the Company’s related remuneration policies and assessment standards.
5. Profit distribution preplan 2011
As audited by Deloitte Touche Tohmatsu CPA Ltd, the net profit attributed to listed company’s
stockholders in year 2011 was 17,529,063.37 Yuan. In 2011, the Company did not withdraw surplus
reserve.
In order to raise the Company’s future earning power, its undistributed profit at the end of 2011, say
total 454,070,630.72 Yuan was carried forward to next year by combining with the Company’s current
operation status, in order to supplement the current capital necessary for daily operation.
In 2011, the Company did not allocate profit, and did not have preplan for increase of capital stock
with capital reserve.
Cash bonus in the previous three years of the Company (filled out)
(Unit: Yuan)
Proportion among the
Net profit attributed to listed net profit attributed to
Amount of cash bonus company’s stockholders in the listed company’s Distributable profit in
(tax included) consolidated financial statements stockholders in the the year
in bonus distribution year consolidated financial
statements
2010 0.00 -114,638,678.20 0.00% 436,541,567.35
2009 0.00 74,101,829.77 0.00% 551,180,245.55
2008 0.00 10,763,920.54 0.00% 473,871,306.65
Proportion of accumulative cash bonus in the latest three years among the
annual average net profit of latest years (%)
6. Information disclosure
In the reporting period, the board of directors disclosed 75 various periodic and interim
announcements correctly in time.
7. Execution of insider information graspers management system
The Company has made the Information Disclosure Management System and the Insider
Information Graspers Registration System, and set fort the regulations on confidentiality of information.
When reporting information to the outside according to laws, the Company requires related personnel to
fill out the Insider Information Graspers Registration Form, and prompts related personnel to observe
related laws and rules. In the reporting period, when filing periodic reports, the Company has submitted
the Name List of Insider Information Graspers to Shenzhen Stock Exchange and Shenzhen Securities
Regulatory Commission, and filed the Form of Non-open Information Provided to Major Stockholders to
Shenzhen Securities Regulatory Commission respectively.
8. Statement on internal control responsibility
The board of directors hereby promises that, the Company’s Self-evaluation Report on Internal
Control 2011 is free of any false and misleading representation or major omissions, and the information
disclosed is authentic, accurate and integrate.
VIII. Report of the Board of Supervisors
(I) Work of the Board of Supervisors
In line with national laws and rules as well as related regulations of the Articles of Association, the
board of supervisors has performed various duties in earnest. In the reporting period, the board of
supervisors held 13 meetings in total, attended all the meetings of the board of directors as non-voting
delegate, audited important proposals and presented written opinions. The concrete information on
meetings of the board of supervisors is as shown below:
1. On Jan. 13, 2011, the Company held the 31st meeting of the fifth board of supervisors, which
deliberated and passed the Proposal on Change of Supervisors.
2. On Mar. 11, 2011, the Company held the 32nd meeting of the fifth board of supervisors, which
deliberated and passed the Proposal on Recommending Candidates for Supervisors of the Company’s
Sixth Board of Supervisors.
3. On Apr. 13, 2011, the Company held the 33rd meeting of the fifth board of supervisors, which
deliberated and passed the Work Report of the Board of Supervisors 2010, the Financial Settlement and
Analysis Report 2010, the Profit Allocation Preplan 2010, The Whole Paper and Abstract of Annual
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Report 2010, the Self-evaluation Report on Internal Control 2010, and the Proposal on the Company’s
Bank Credit Extension Scale, External Guaranty, Entrusted Bank Loan or Direct Loan of Fund in the
System 2011.
4. On Apr. 21, 2011, the Company held the 34th meeting of the fifth board of supervisors, which
deliberated and passed the First-quarter Financial Settlement Report 2011, and the Whole Paper and Text
of the First-quarter Report 2011.
5. On Apr. 24, 2011, the Company held the interim meeting of the fifth board of supervisors, which
deliberated and passed the Plan for Implementation of Internal Control Specification of Shenzhen
Nanshan Power Co., Ltd.
6. On May 20, 2011, the Company held the 35th meeting of the fifth board of supervisors, which
deliberated and passed the Proposal on Disposal of Bonus of Shenzhen Nanshan Power (Dongguan)
Weimei Power Co., Ltd.
7. On May 25, 2011, the Company held the 1st meeting of the sixth board of supervisors, which
deliberated and passed the Proposal on Electing Chief Supervisor of the Company.
8. On July 8, 2011, the Company held the 2nd meeting of the sixth board of supervisors, which
deliberated and passed the Proposal on Increasing the Line of Entrusted Bank Loan or Direct Loan of
Fund in the System.
9. On Aug. 8, 2011, the Company held the 3rd meeting of the sixth board of supervisors, which
deliberated and passed the Semi-annual Financial Settlement and Analysis Report 2011, the Whole Paper
and Abstract of Semi-annual Report 2011 (Chinese-English Version).
10. On Sept. 8, 2011, the Company held the 4th meeting of the sixth board of supervisors, which
deliberated and passed the Proposal on Capital Increase of Shenzhen Nanshan (Zhongshan) Power Co.,
Ltd., and the Proposal on Increasing the Line of External Guaranty, Entrusted Bank Loan or Direct Loan
of Fund in the System.
11. On Oct. 14, 2011, the Company held the 5th meeting of the sixth board of supervisors, which
deliberated and passed the Proposal on Transferring 10% Stock Equity of Shenzhen Energy
Environmental Protection Co., Ltd.
12. On Oct. 19, 2011, the Company held the 6th meeting of the sixth board of supervisors, which
deliberated and passed the Whole Paper and Text of the Third-quarter Report 2011.
13. On Dec. 1, 2011, the Company held the 7th meeting of the sixth board of supervisors, which
deliberated and passed the Proposal on Paying Remuneration to Auditing Institution 2011, and the
Proposal on Transferring 30% Stock Equity of CPI Jiangxi Xinchang Power Generation Co., Ltd.
II. Independent Opinions of the Board of Supervisors
(I) The Company’s operation according to laws
By supervising the Company’s directors and senior management personnel, the board of supervisors
considers that, in the reporting period, the Company’s board of directors and managerial level could
operate businesses in a lawful and normative way according to the regulations of national laws and rules,
as well as the articles of association. The Company has basically established and perfected the corporate
governance structure. The Company’s directors and senior management personnel could carry out
national laws and rules, articles of association, and resolutions made by stockholders’ conference and
board of directors, and could perform duties in a diligent way. No director or senior management
personnel have been discovered to commit any behavior damaging the benefits of the Company and
stockholders during their duty performance.
(II) Inspection of the Company’s financial affairs
In the reporting period, the Company’s board of supervisors has audited the Company’s periodic
reports, accounting statements and related documents, and considered that, the board of directors meets
the laws, administrative rules, and regulations of China Securities Regulatory Committee in terms of
compilation and auditing procedures of periodic reports, and no false record, misleading representation or
major omission is discovered in the data recorded.
(III) Re-election of the board of supervisors
1. On Jan. 13, 2011, the Company held the 31st Meeting of the Fifth Board of Supervisors,
deliberated the Proposal on Recommending Supervisor Candidates for the Fifth Board of Supervisors,
and agreed the nominating stockholder Shenzhen Guangju Investment Holding Co., Ltd. to recommend
Miss Ji Yuanhong as supervisor candidate of the Fifth Board of Supervisors.
2. On Mar. 11, 2011, the Company held the 32nd Meeting of the Fifth Board of Supervisors,
deliberated the Proposal on Recommending Supervisor Candidates for the Company’s Sixth Board of
Supervisors, and agreed to nominate Mr. Zhao Xiangzhi, Miss Ma Fengming, Miss Ji Yuanhong, and Mr.
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Wang Difei as supervisor candidates of the Sixth Board of Supervisors.
3. On May 25, 2011, the Company held the 1st Meeting of the Sixth Board of Supervisors, and
elected supervisor Zhao Xiangzhi as chief supervisor of the Sixth Board of Supervisors.
(IV) Purchasing and sale of assets
In the reporting period, the Company has transferred its 10% stock equity in Shenzhen Energy
Environmental Protection Co., Ltd.; and 30% stock equity in CPI Jiangxi Xinchang Power Generation
Co., Ltd..
The board of supervisors considers, as concerning the abovementioned sale of assets in the reporting
period, the Company’s decision making procedure is lawful and proper, the transaction price is
determined on reasonable basis, no insider transaction is discovered, and such asset transactions don’t
damage other stockholders’ rights and interests or cause the loss of the Company’s properties, and instead,
they meet the Company’s actual demand.
(V) Associated transactions
The Company has transferred its 10% stock equity in Shenzhen Energy Environmental Protection
Co., Ltd. Shenzhen Energy Group Co., Ltd. de-listed successfully, and this formed associated transaction.
The board of supervisors considers that, in the reporting period, the Company’s associated transactions
have followed related regulations, the decision-making procedures are lawful, no insider transaction is
discovered, and such transactions don’t damage other stockholders’ equity and list companies’ benefit, or
cause the loss of the Company’s properties.
(VI) Board of supervisors’ evaluation opinions on the Company’s internal control
According to related regulations of China Securities Regulatory Committee and Shenzhen Stock
Exchange, in line with the basic principles of internal control, and according to its actual situations, the
Company has employed professional consulting institution, basically established and perfected relatively
complete internal control system, has not been discovered any serious defect and abnormality in internal
control, and ensured the safe, complete and effective use of its properties. In addition, the Company’s
internal control self-evaluation reflects the actual situation of its internal control in an authentic and
objective way.
At present, the Company’s internal control organization is relatively complete. In the coming year,
the Company is expected to perfect its internal control mechanism, ensure its sustainable and healthy
development, and guarantee all stockholders’ benefits according to new regulations of national laws and
rules, departmental regulations, and normative documents, etc., as well as the internal control plan
approved by the Company’s board of directors.
(VII) Opinions on the matters involved in non-standard qualified audit opinions
1. The emphasized matters, as listed in the Special Description about the Audit Report with Qualified
Opinions on Emphasized Matters for Shenzhen Nanshan Power Co., Ltd. and the Audit Report 2011 of
Shenzhen Nanshan Power Co., Ltd. presented by Deloitte Touche Tohmatsu CPA Ltd, reflect the
possibility of responsibilities and compensations existing after termination of transactions.
2. The board of directors’ Special Description about the Emphasized Matters Attached to the Audit
Report 2011 is agreed.
IX. Important Matters
(I) The Company did not have any important lawsuit and arbitration matter in the present year.
(II) The Company did not have any matter related to bankruptcy and reorganization in the reporting
period.
(III) The Company’s holding of stock equity in other listed companies, equity participation in
commercial banks, securities companies, insurance companies, trust companies, and futures companies,
etc.
(IV) Acquisition and sale of assets, absorption and merger
1. Listed transfer of 10% stock equity in Shenzhen Energy Environmental Protection Co., Ltd.
On Oct. 14, 2011, the 5th Meeting of the Company’s Sixth Board of Directors deliberated and passed
the Proposal on Transfer of 10% Stock Equity in Shenzhen Energy Environmental Protection Co., Ltd.
(―Shenneng Environmental Protection Company‖), and agreed the Company to transfer its 10% stock
equity in Shenzhen Energy Environmental Protection Co., Ltd. at the listed price RMB 123078900 Yuan
(for details, please refer to the Company’s announcement dated at Oct. 15, 2011, and numbered as 2011
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
－059).
On Oct. 31, 2011, the Company transferred its 10% stock equity in Shenzhen Energy Environmental
Protection Co., Ltd. in an openly listed way at Shenzhen United Property And Share Rights Exchanged.
During listing period, only Shenzhen Energy Group Co., Ltd. (―Shenzhen Energy‖) agreed to accept the
transfer. According to related procedures of property transaction, the Company confirmed the
qualification of Shenzhen Energy for accepting the transfer in writing on Nov. 29, 2011. Later on Dec. 1,
2011, the Company signed the Contract for Transfer of 10% Stock Equity in Shenzhen Energy
Environmental Protection Co., Ltd. with Shenzhen Energy. Shenzhen Energy Corporation holds 10.8%
stock equity in the Company, and 63.74% stock equity in Shenzhen Energy, so this stock equity transfer
forms associated transaction, and the Company disclosed the announcement on associated transaction on
Dec. 2, 2011 (for details, please refer to the announcement numbered as 2011－069). The Company has
received the full amount for equity transfer, namely RMB 123078900 Yuan, and completed the
formalities for registration of industrial and commercial alterations on Jan. 6, 2012.
2. Agreement-based transfer of 30% stock equity in CPI Jiangxi Xinchang Power Generation Co.,
Ltd.
On Dec. 1, 2011, the 3rd Interim Meeting of the Company’s Sixth Board of Directors deliberated and
passed the Proposal on Transfer of 30% Stock Equity in CPI Jiangxi Xinchang Power Generation Co.,
Ltd., and agreed the Company to transfer based on agreement its 30% stock equity in CPI Jiangxi
Xinchang Power Generation Co., Ltd.(―Jiangxi Xinchang Company‖) to CPI Jiangxi Power Co.,
Ltd.(―CPI Jiangxi Company‖) at the price of RMB 217024700 Yuan (for details, please refer to the
Company’s announcement dated at Dec. 2, 2011, and numbered as 2011－074). On Dec. 18, 2011, the
Company held the 6th Interim Meeting of Stockholders’ Conference in 2011, and deliberated and passed
the Proposal on Transfer of 30% Stock Equity in CPI Jiangxi Xinchang Power Generation Co., Ltd. (for
details, please refer to the announcement numbered as 2011－075).
On Dec. 29, 2011, the Company and CPI Jiangxi Power Co., Ltd. signed the Contract for Transfer of
Stock Equity in CPI Jiangxi Xinchang Power Generation Co., Ltd.. According to the Contract, CPI
Jiangxi Company shall pay 51% fee for transfer of stock equity before Dec. 31, 2011, namely RMB
110682600 Yuan, and pay off the remained 41% before April 1, 2012. As of Dec. 30, 2012, the Company
has received 51% stock equity transfer fee from CPI Jiangxi Company, namely RMB110682600 Yuan,
and completed the formalities for registration of industrial and commercial alterations.
(V) Implementation of stock equity excitation plan
In the reporting period, the Company did not implement the stock equity excitation plan.
(VI) Important associated transactions
1. Associated transactions related to daily operation
In the reporting period, the Company did not have associated transaction related to daily operation.
2. Associated transactions of assets purchasing and sale
For details, please refer to ―IX. Important Matters (IV) Acquisition and sale of assets, absorption
and merger --- 1. Listed transfer of 10% stock equity in Shenzhen Energy Environmental Protection Co.,
Ltd.‖.
3. Associated transactions of joint investments of the Company and associated parties
For details, please refer to ―VII. Report of the Board of Directors, (III) Investments --- 2. Investment
of non-raised funds (7) Shenneng Environmental Protection Company‖.
4. Creditor’s rights, debts, and guaranty, etc. between the Company and associated parties (including
subsidies not taken into consolidated scope)
(1) Creditor’s rights and debts between the Company and associated parties
(Unit: Yuan)
Relationshi Fund provided by listed Fund provided by associated
p with companies to associated parties parties to listed companies
listed Account Account
Name of associated parties companies incurred Balance incurred Balance
Xiefu Company Subsidiary -1,102.03 6,279,745.17 24,816,710.76 26,696,762.50
Shenzhen Nanshan Power
Zhongshan Company Subsidiary 319,391,519.18 831,243,082.6
Shenzhong Real Estate
Company Subsidiary -4,431,474.82 688,629,880.98
Shenzhen Nanshan Power Subsidiary 56,264,962.17 56,264,962.17 20,921,006.08 81,036.534.88
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Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
Engineering Co., Ltd.
Shenzhen Nanshan Power
Dongguan Subsidiary 14,578,623.18 85,437,069.99 131,773,022.23 131,773,022.23
New Power Company Subsidiary 0 597,875,904.41 306,190,948.20 776,413,945.94
Shenzhen Nanshan Power
Environmental Protection
Company Subsidiary 11,017,120.27 11,017,120.27 -1,129,973.65 0
Xingdesheng Co., Ltd Subsidiary 15,530.41 35,127.06 -86,530.14 1,682,266.99
Singapore Company Subsidiary 107,588.53 138,660.87
Stockholder
Energy Co., Ltd. ’s 0 14,586,000.00
subsidiary
2,276,921,553.5
Total 396,942,766.89 2 482,485,183.48 1,032,188,532.54
(2) Guaranty provided for associated parties
(Unit: Yuan)
The guaranteed Relation with listed company Guaranteed amount (2011.12.31)
Shenzhen Nanshan Power Zhongshan Subsidiary 190,000,000.00
Company
Shenzhen Nanshan Power Dongguan Company Subsidiary 600,000,000.00
Shenzhen Nanshan Power Environmental Subsidiary 46,000,000.00
Protection Company
New Power Company Subsidiary 350,000,000.00
Total 1,186,000,000.00
(3) Independent directors’ description about and opinions on external guaranty
According to related regulations of Notification on Normalizing the Current Accounts of Listed
Companies and Associated Parties, and on External Guaranty of Listed Companies (ZJF [2003] No. 56
Document), Notification on Normalizing External Guaranty Behaviors of Listed Companies (ZJF [2005]
No. 120) and Notification on Information Disclosure of Listed Companies’ Fund Occupation and
Delinquent Guaranty (SZJFZ [2004] No. 338), and after the Company’s investigation and data inquiry,
we hereby issue special description about and opinions on the Company’s external guaranty:
① The fund transfer between the company and the affiliated parties belongs to normal operational
fund transfer. There are no circumstances that the affiliated parties violate and misuse the fund of the
listed company.
②As of Dec. 31, 2011, the balance of the Company’s external guaranty is RMB 1,186,000,000.00
Yuan (bank loan guaranty provided by the Company for its controlling subsidiaries). The Company and
its controlling subsidiaries don’t provide guaranty for stockholders and other associated parties, any
non-corporate unit or individual; in addition, the Company has implemented the information disclosure
obligation of external guaranty in earnest. 5. Other important associated transactions
In the reporting period, the Company did not have other important associated transactions.
(VII) Important contracts and implementation
1. The Company’s trust, contracting, and leasing
According to the Contract for Trust Operation of Gas Turbine- Steam Combined Cycling Afterheat
Generator Set Assets signed in February 2003, the Company was entrusted to operate and manage the
generator set assets owned by the sole subsidiary New Power Company. In the reporting period, the
Company has received 16.34 million Yuan as service charge for asset custody. Except for this, the
Company did not have other important trust, contracting and leasing.
2. Important guaranty
In the reporting period, the Company has implemented legal examination and approval procedures
for external guaranty, as shown below:
(Unit: Yuan)
External guaranty (excluding guaranty for subsidiaries)
Disclosure date Date of actual Guaranty for
Actual
Name of and number of Line of occurrence Guaranty Guaranty Implementation associated
amount of
guaranty object announcement guaranty (date of type period completed or not parties or not
guaranty
related to agreement (yes or no)
- 34 -
Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
guaranty line signing)
Total line of external guaranty Total amount incurred actually
examined and approved in of external guaranty in reporting
reporting period (A1) period (A2)
Total line of external guaranty Total balance of actual external
examined and approved at the end guaranty at the end of reporting
of reporting period (A3) period (A4)
Guaranty for subsidiaries
Disclosure date Date of actual
Guaranty for
and number of occurrence Actual
Name of Line of Guaranty Guaranty Implementation associated
announcement (date of amount of
guaranty object guaranty type period completed or not parties or not
related to agreement guaranty
(yes or no)
guaranty line signing)
WeiMei Power 2011.4.15 and Credit
10,000.00 Dec. 6, 2011 10,000.00 6 months No No
Company 2011-012 guaranty
WeiMei Power 2011.4.15 and Credit
1,000.00 Feb. 14, 2011 1,000.00 1 year No No
Company 2011-012 guaranty
WeiMei Power 2011.4.15 and Credit
9,000.00 Feb. 22, 2011 9,000.00 1 year No No
Company 2011-012 guaranty
WeiMei Power 2011.4.15 and Credit
10,000.00 Dec. 2, 2011 10,000.00 7 months No No
Company 2011-012 guaranty
WeiMei Power 2011.4.15 and Credit
10,000.00 Dec. 7, 2011 10,000.00 7 months No No
Company 2011-012 guaranty
WeiMei Power 2011.4.15 and Credit
8,000.00 July 15, 2011 8,000.00 1 year No No
Company 2011-012 guaranty
WeiMei Power 2011.9.14 and Credit
30,000.00 Dec. 29, 2011 10,000.00 1 year No No
Company 2011-050 guaranty
WeiMei Power 2011.4.15 and Credit
20,000.00 Jan. 10, 2011 2,000.00 1 year No No
Company 2011-012 guaranty
ZhongShan 2011.4.15 and Credit
5,000.00 Sept. 9, 2011 5,000.00 1 year No No
Power Company 2011-012 guaranty
ZhongShan 2011.4.15 and Credit
5,000.00 Apr. 1, 2010 5,000.00 1 year No No
Power Company 2011-012 guaranty
ZhongShan 2011.4.15 and Credit
9,000.00 Jan. 21, 2011 9,000.00 1 year No No
Power Company 2011-012 guaranty
Environmental
2011.4.15 and Credit
Protection 1,000.00 Aug. 3, 2011 1,000.00 1 year No No
2011-012 guaranty
Company
Environmental
2011.4.15 and Credit
Protection 8,000.00 Nov. 6, 2009 2,600.00 3 years No No
2011-012 guaranty
Company
Environmental
2011.4.15 and Credit
Protection 3,000.00 July 22, 2011 1,000.00 11 months No No
2011-012 guaranty
Company
New Power 2011.4.15 and Credit
3,000.00 June 30, 2011 3,000.00 1 year No No
Company 2011-012 guaranty
New Power 2011.4.15 and Credit
3,000.00 July 6, 2011 3,000.00 1 year No No
Company 2011-012 guaranty
New Power 2011.4.15 and Credit
3,000.00 Aug. 25, 2011 3,000.00 1 year No No
Company 2011-012 guaranty
New Power 2011.4.15 and Credit
1,000.00 Sept. 2, 2011 1,000.00 1 year No No
Company 2011-012 guaranty
New Power 2011.9.14 and Credit
15,000.00 Dec. 22, 2011 10,000.00 1 year No No
Company 2011-050 guaranty
New Power 2011.9.14 and Credit
15,000.00 Dec. 9, 2011 10,000.00 1 year No No
Company 2011-050 guaranty
New Power 2011.9.14 and Credit
5,000.00 Oct. 27, 2011 5,000.00 1 year No No
Company 2011-050 guaranty
Total line of guaranty for Total amount incurred actually
subsidiaries examined and 174,000.00 of guaranty for subsidiaries in 118,600.00
approved in reporting period (B1) reporting period (B2)
Total line of guaranty for
Total balance of actual guaranty
subsidiaries examined and
174,000.00 for subsidies at the end of 118,600.00
approved at the end of reporting
reporting period (B4)
period (B3)
Gross amount of guaranty (namely total of the previous two items)
Total line of guaranty examined 174,000.00 Total amount actually incurred 118,600.00
- 35 -
Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
and approved in reporting period of guaranty in reporting period
(A1+B1) (A2+B2)
Total line of guaranty examined Total balance of actual guaranty
and approved at the end of 174,000.00 at the end of reporting period 118,600.00
reporting period (A3+B3) (A4+B4)
Proportion of actual gross guaranty (namely A4+B4) among the
67.64%
Company’s net assets
Where:
Amount of guaranty provided for stockholders, actual controllers and
0.00
their associated parties (C)
Amount of debt guaranty provided directly or directly for the guaranteed
114,000.00
objects with asset-liability ratio of over 70% (D)
Amount of the part that gross guaranteed amount exceeds 50% of net
24,209.45
assets (E)
Total amount of the abovementioned three guaranties (C+D+E) 138,209.45
Description about the possible joint and several responsibilities for
discharging the outstanding guaranties
3. In the reporting period, the Company has not entrusted others for cash asset management.
4. Important contracts
(1) After being deliberated and approved at the 36th Meeting of the Fifth Board of Directors, and the
th
4 Interim Meeting of Stockholders’ Conference in 2010, both the Company and Shenzhen Nanshan
Power Dongguan Company plan to sign the contract for purchasing of natural gas with CNOOC
Oil—Gas Power Group Co., Ltd. Guangdong Trade Branch, CNOOC Oil Guangdong Branch respectively.
Where, the Company (solely-funded Nanshan Thermal Power Factory) has signed a two-year contract
(January 2011 – December 2012), and Shenzhen Nanshan Power Dongguan Company has signed a
three-year contract (January 2011- December 2013) (announcement number: 2010-048, 050, 058).
Related contracts are being implemented.
(2)The 5th Meeting of the Company’s Sixth Board of Directors deliberated and passed the Proposal
on Transfer of 10% Stock Equity in Shenzhen Energy Environmental Protection Co., Ltd., and agreed the
Company to transfer its 10% stock equity in Shenzhen Energy Environmental Protection Co., Ltd. in a
listed way (for details, please refer to the Company’s announcement dated at Oct. 15, 2011 and numbered
as 2011－059).
On Dec. 1, 2011, the Company and Shenzhen Energy Group Co., Ltd. signed the Contract for
Transfer of 10% Stock Equity in Shenzhen Energy Environmental Protection Co., Ltd. (for details, please
refer to the announcement numbered as 2011－069).
(3) After being deliberated and approved at the 3rd Interim Meeting of the Company’s Sixth Board of
Directors and the 6th Interim Meeting of Stockholders’ Conference in 2011, the Company and CPI Jiangxi
Power Co., Ltd. signed the Contract for Stock Equity Transfer of CPI Jiangxi Xinchang Power Generation
Co., Ltd. on Dec. 29, 2011 (announcement number: 2011-074, 075).
5. Important disputes in the reporting period
In March 2008, the Company and Jierun (Singapore) Private Corporation (―Jierun Corporation‖)
signed two letters of confirmation on the contract of oil options (―Letter of Confirmation‖) numbered as
165723977102.11 and 165723968102.11.
In 2009, the Company and Jierun Corporation conducted several rounds of negotiation on the
disputes about the two Letters of Confirmation based on not affecting both parties’ rights, but failed to
reach amicable settlement. On Nov. 27, 2009, Jierun Corporation entrusted Allen & Overy International
Law Firm (―Allen‖) to send us a letter, requiring the Company to pay USD79,962,943.00 for
compensating Jierun Corporation’s losses arising from its breach of contract, and the interest
USD3,736,958.66 as of Nov. 27, 2009. In case the Company fails to pay the aforesaid money, Jierun
Corporation shall reserve the right of lodging a complaint without further notification. Meanwhile, Jierun
Corporation entrusted Allen to send us another letter, bringing forward the proposal for amicable
settlement, namely making payment of only USD79,962,943.00 by 13 installments, with interest
exempted (for details, please refer to the announcement dated at Dec. 29, 2009 and numbered as 2009－
069). The Company sent a written reply on Jan. 25, 2010, and rejected the requirement of Jierun
Corporation on loss compensation, and required Jierun Corporation to undertake liabilities for breach of
contract, including but not limited to paying the account payable USD300,000 in October 2008 as well as
related interest USD16,862.52. Allen sent us a written reply on Feb. 26, 2010, refused to undertake any
responsibility for the Company, and persisted in its standpoint stated in the written reply dated at Nov. 27,
- 36 -
Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
2009.
On Mar. 31, 2011 and Feb. 6, 2012, Jierun Corporation sent us a letter to claim for the Company’s
liability for breach of contract personally or by entrusting Allen, and the Company sent it a written reply
on April 6, 2011 and Feb. 10, 2012 respectively, clearly rejected Jierun Corporation’s claim for
compensation, and persisted in the opinions and claims in the written reply dated at Jan. 25, 2010.
On Sept. 22, 2011, Jierun Corporation dispatched personnel to communicate with the Company’s
related personnel on this dispute, but both parties failed to reach consensus.
No progress is seen in this matter at present.
(VIII) Implementation of commitments
In the reporting period, the Company and its directors, supervisors, senior management personnel,
and stockholders holding more than 5% (including 5%) shares don’t have new commitments or previous
commitments extended to the reporting period and possibly having heavy impact on the Company’s
operating result and financial conditions.
(IX) Employment of CPA firm and payment of remuneration in the reporting period
On May 10, 2011, according to the resolution of the annual meeting of stockholders’ conference
2010, the Company agreed to continuously employ Deloitte Touche Tohmatsu CPA Ltd as the audit
institution for the year 2011.
Wit the authorization of the annual meeting of stockholders’ conference 2010, and after being
deliberated and passed at the 3rd Interim Meeting of the Company’s Sixth Board of Directors, it’s agreed
to pay Deloitte Touche Tohmatsu CPA Ltd 1.30 million Yuan as remuneration for auditing in 2011, and
the Company shall undertake the traveling expenses during audit period.
(X) The Company and its directors, supervisors, senior management personnel, stockholders,
actual controllers, and acquirers were not subject to the investigation of authoritative institutions,
compulsory actions of judicial and disciplinary inspection departments, and being sent to judicial
organs or investigated into criminal responsibilities, etc. in the reporting period.
(XI) The Company did not have other important events listed in Article 67 of Securities Law
and Article 17 of Detailed Rules for Implementing Information Disclosure of Companies Issuing
Stock Publicly (On Trial) in the reporting period.
(XII) Investors investigation and interview accepted by the Company in reporting period
In the reporting period, the Company gave priority to accepting individual investors’ consulting by
telephone, and investors mainly consulted the Company’s performance, and production operation status,
etc. When accepting interview and investors’ inquiry, the Company did not have such situations of
revealing, disclosing or betraying the Company’s non-open important information separately to certain
objects selectively, privately and in advance, but guaranteed the fairness of information disclosure. In total,
the Company has accepted the field investigation of domestic and overseas stockholders and investors for
once in total.
Main contents discussed and documents
Time Place Mode Object
provided
Field Proposal on increasing the line of
July 27, Conference Securities
investigatio entrusted bank loan or direct loan of capital in
2011 room investor
n the system
X. Financial Statements
The Company’s financial statements have been audited by Deloitte Touche Tohmatsu CPA Ltd, and
the audit report with qualified opinions on matters emphasized. )
XI. Catalog of Documents for Future Reference
(I) Accounting statements bearing the signature and seal of legal representative, person in charge
of accounting, and principal of accounting institution.
- 37 -
Shenzhen Nanshan Power Co., Ltd. Full Text of Annual Report 2011
(II) Original audit report bearing the seal of CPA firm, and signature and seal of certified public
accountants.
(III) Originals of all the Company’s documents disclosed publicly, and originals of announcements
made at Securities Times, China Securities Journal and Hong Kong Commercial Daily in the reporting
period, and original of
(IV) Annual report publicized at overseas newspapers.
Legal representative: Yang Haixian
Shenzhen Nanshan Power Co., Ltd.
Apr. 24, 2012
- 38 -
Shenzhen Nanshan Power Co., Ltd.
Financial Statements and Audit Report
Year to December 31, 2011
1
Shenzhen Nanshan Power Co., Ltd. English
Financial Statement and Audit Report
Year to December 31, 2011
Content Page
Audit Report 1-2
Parent Company Balance Sheet and Consolidated Balance Sheet 3-4
Parent Company and Consolidated Profit Statement 5-6
Parent Company Cash Flow Statement and Consolidated Cash Flow Statement 7-8
Consolidated Statement of Changes in Shareholder Equity 9 - 10
Annotations of Financial Statements 11 - 91
1
Audit Report
D.S. Report (Audit) Zi. (12) NO. P1093
General body of shareholders of Shenzhen Nanshan Power Co., Ltd:
We have audited the accompanying balance sheet of Shenzhen Nanshan Power Co., Ltd (hereinafter referred to
as ―Nanshan Power Company‖) as of December 31, 2011, and the related consolidated income statement,
consolidated statement of changes in stockholders’ equity accounts and consolidated statement of cash flow for the
2011 then ended, as well as notes to financial statements.
I. Responsibility of the Company’s Management for Financial Statements
It is the responsibility of the management personnel in Shenzhen Nanshan Power Co., Ltd. to compile, list and
report the financial statement. Such responsibility should include (1) compilation of financial statement according to
the Accounting Principle for Business Enterprises and realization of fairness; (2) design, execution and maintenance
of necessary internal control so that the financial statement does not suffer from any serious mistaken report due to
malpractices or errors.
II. Responsibility of Certified Public Accountants
It’s our responsibility to give an audit opinion on these financial statements according to our audit. We
conducted our audit in accordance with the Independent Auditing Standards for China Certified Public Accountants.
Those Standards require that we abide by professional ethics, plan and perform the audit to obtain reasonable
assurance for whether the financial statements are free of material misstatement or not.
An audit is involved in executing auditing procedures to obtain audit evidence supporting the amounts and
disclosures in the financial statements. The auditing procedures are selected according to the CPA’s judgment, and
an audit also includes assessing the risk of any material misstatement in the financial statements due to fraud or
mistake. During risk assessment, CPA take internal controls related to the compilation of financial statements and
fair presentation into account for not giving an opinion on the effectiveness of internal controls but selecting
suitable auditing procedures. An audit also includes evaluating the applicability of accounting policies selected by
the Company’s management and the rationality of accounting estimates made by the Company’s management as
well as evaluating the overall presentation of financial statements.
We believe that we obtained adequate suitable audit evidence that provides a reasonable basis for our audit
opinion.
III. Opinion
In our opinion, the financial statements give a true and fair view of the financial position of Nanshan Power
Company as of December 31, 2011, and of its consolidated performance and cash flow for the 2011 year then ended
in accordance with accounting standards for business enterprises.
IV. Emphasis of Matter
We hereby remind the users of the Company’s financial statements of paying attention to that, as stated in (VII)
―Contingencies‖ of Annotations of Financial Statements, the company hasn’t achieved a consensus with J. Aron
(Singapore) Private Company yet in respect of liabilities and compensations after the termination of an option
agreement, and both parties may solve the dispute between them in a judicial way. Because the final result of the
matter above can’t be reliably estimated, the Company didn’t identify estimated liability in the financial statements.
Nevertheless, the content of this paragraph doesn’t influence our audit opinion presented above.
Deloitte Touche Tohmatsu CPA Ltd. Chinese Certified Public Accountant
Shanghai, China
Chinese Certified Public Accountant
April 20, 2012
-1-
Shenzhen Nanshan Power Co., Ltd English
December 31, 2011
Consolidated Balance Sheet
Unit: RMB Yuan
Annot Beginning balan Annot Beginning balanc
Item Ending balance Item Ending balance
ation ce ation e
Current assets: Current liabilities:
Monetary
(V)1 695,095,052.12 601,386,814.04 Short-term loans (V)17 3,265,824,953.89 3,112,400,000.00
capital
Notes
(V)2 - 700,000.00 Notes payable (V)18 43,820,200.00 -
receivable
Accounts
(V)3 934,640,019.03 518,392,276.69 Account payable (V)19 214,748,889.66 61,115,438.61
receivable
Advance
(V)4 31,576,397.23 13,529,901.89 Deposit received (V)20 14,586,000.00 39,274,341.26
payment
Other accounts
(V)5 124,599,842.72 20,450,149.23 Payroll payable (V)21 32,691,674.04 45,432,950.70
receivable
Inventory (V)6 1,258,195,597.25 1,352,372,212.06 Taxes payable (V)22 (521,900,793.90) (501,193,418.09)
Other current Accrued interest
(V)7 - 4,242,431.37 (V)23 75,462,594.51 59,348,039.27
assets payable
Total current
3,044,106,908.35 2,511,073,785.28 Other payables (V)24 358,597,380.00 288,768,647.34
assets
Noncurrent
Noncurrent liabilities due within (V)25 50,000,000.00 50,000,000.00
assets: one year
Long-term
Total current
equity (V)8 37,315,000.00 306,208,274.30 3,533,830,898.20 3,155,145,999.09
liabilities
investment
Investment real Noncurrent
(V)9 4,872,045.07 5,308,769.98
estate liabilities:
Fixed assets (V)10 2,227,103,579.26 2,169,226,270.73 Long-term loans (V)26 26,000,000.00 186,000,000.00
Construction in Other noncurrent
(V)11 46,866,969.48 196,729,476.64 (V)27 5,104,791.66 5,350,000.00
process liabilities
Intangible Total noncurrent
(V)12 63,807,538.62 64,236,931.51 31,104,791.66 191,350,000.00
assets liabilities
Long-term
unamortized (V)13 95,810.84 273,212.64 Total liabilities 3,564,935,689.86 3,346,495,999.09
expenses
Deferred
Shareholder’s
income tax (V)14 3,714,114.31 4,624,405.14
equity:
assets
Other
noncurrent (V)15 24,864,716.98 21,273,223.68 Stock capital (V)28 602,762,596.00 602,762,596.00
assets
Total
noncurrent 2,408,639,774.56 2,767,880,564.62 Capital surplus (V)29 363,629,927.51 363,629,927.51
assets
Surplus reserve (V)30 332,908,397.60 332,908,397.60
Undistributed profit (V)31 454,070,630.72 436,541,567.35
Total shareholder’s
equity belonging to 1,753,371,551.83 1,735,842,488.46
the parent company
Minor shareholders’
134,439,441.22 196,615,862.35
equity
Total shareholders’
1,887,810,993.05 1,932,458,350.81
equity
Total liabilities and
Total assets 5,452,746,682.91 5,278,954,349.90 5,452,746,682.91 5,278,954,349.90
shareholders’ equity
Annotations are part of financial statements.
From the third page to the ninety-first page of financial report shall be signed by the following principles:
Legal Representative: ___________ Accountant in Charge: ________CFO _____Accounting Principal: ____________
-2-
Shenzhen Nanshan Power Co., Ltd English
December 31, 2011
Balance Sheet of the Company
Unit: RMB Yuan
Balance at the
Balance at the Beginning
Item Note Ending balance beginning of the Item Note
end of the year balance
year
Current assets: Current liabilities:
Short-term
Monetary capital 303,150,447.89 269,369,131.18 1,880,824,953.89 2,218,000,000.00
borrowing
(XI)1
Accounts
646,023,065.42 277,107,630.12 Account payable 145,440,717.47 1,749,561.08
receivable
Account collected
Advance payment 489,676.70 455,623.51 14,586,000.00 14,586,000.00
in advance
Dividends Wages and welfares
654,140,866.58 597,875,904.41 16,426,938.52 26,713,770.75
receivable payable
Other receivable (XI)2 1,525,724,625.88 894,247,309.68 Tax payable (414,050,692.13) (436,158,042.22)
Inventory 112,185,828.84 166,594,071.43 Interest payable 5,585,474.16 3,720,714.47
Other current
205,000,000.00 393,003,940.43 Other payables 1,064,365,847.79 490,528,945.93
assets
Total current Total current
3,446,714,511.31 2,598,653,610.76 2,713,179,239.70 2,319,140,950.01
assets liabilities
Non-current
Total liability 2,713,179,239.70 2,319,140,950.01
assets
(XI)3
Long-term equity Stockholder’s
536,797,849.76 796,731,124.06
investment equity
Fixed assets 327,435,225.16 316,444,713.69 Capital stock 602,762,596.00 602,762,596.00
Construction in
36,184,921.10 56,766,007.77 Capital reserve 288,769,132.47 288,769,132.47
process
Intangible assets 10,658,977.27 9,318,739.90 Surplus reserve 332,908,397.60 332,908,397.60
Long-term Undistributed
95,810.84 171,594.44 420,267,929.67 234,504,714.54
deferred expense profits
Total non-current Total shareholder’s
911,172,784.13 1,179,432,179.86 1,644,708,055.74 1,458,944,840.61
assets equity
Total liability and
Total assets 4,357,887,295.44 3,778,085,790.62 shareholder’s 4,357,887,295.44 3,778,085,790.62
equity
-3-
Shenzhen Nanshan Power Co., Ltd English
Year to December 31, 2011
Consolidated Income Statement
Unit: RMB Yuan
Amount of current
Item Note Amount of last year
year
I Gross revenue (V)32 2,415,817,730.35 1,601,730,465.30
Including: operation revenue 2,415,817,730.35 1,601,730,465.30
II Total cost 3,928,456,443.60 2,482,988,623.82
Including: business cost (V)32 3,589,704,382.71 2,239,345,909.35
business tax and surcharges (V)33 12,574,988.91 7,363,142.54
Selling expense 818,301.34 860,503.71
Management fee (V)34 97,538,885.64 95,926,428.20
Financial expense (V)35 204,297,949.90 128,297,803.98
Loss from asset devaluation (V)36 23,521,935.10 11,194,836.04
Add: income from investment (V)37 23,329,325.70 (49,130,454.11)
Including: income from investment on joint venture and
(90,201,890.81) (49,082,776.11)
cooperative enterprise
III Operation profit (1,489,309,387.55) (930,388,612.63)
Add: non-business income (V)38 1,516,790,851.26 832,316,848.06
Less: non-business expense (V)39 5,225,709.23 573,905.21
Including: disposal loss on non-current liability 4,985,709.23 16,537.00
IV Total profit 22,255,754.48 (98,645,669.78)
Less: income tax expense (V)40 13,224,142.33 24,787,762.05
V Net profit 9,031,612.15 (123,433,431.83)
Net profit assigned to shareholders of parent company 17,529,063.37 (114,638,678.20)
Minority interest income (8,497,451.22) (8,794,753.63)
VI Earnings per share
(I) Basic earnings per share (V)41 0.03 (0.19)
(II) Diluted earnings per share Not applicable Not applicable
VII Other comprehensive income - -
VIII Total comprehensive income 9,031,612.15 (123,433,431.83)
Total comprehensive income assigned to shareholders of parent
17,529,063.37 (114,638,678.20)
company
Total comprehensive income assigned to minority shareholder (8,497,451.22) (8,794,753.63)
-4-
Shenzhen Nanshan Power Co., Ltd English
Year to December 31, 2011
Income Statement
Unit: RMB Yuan
Amount of Amount of last
Item Note
current year year
I Operation revenue (XI)4 990,279,741.52 426,971,872.85
Less: business cost (XI)4 1,598,330,636.84 765,825,140.43
Business tax and surcharges 4,276,838.43 3,625,424.13
Management expense 39,248,022.53 18,316,516.73
Financial expense 80,500,949.95 44,656,802.83
Loss from asset devaluation 16,041,488.47 12,092,537.18
Add: income from invest (XI)5 151,166,247.74 (49,130,454.11)
Including: income from investment on joint venture
(90,201,890.81) (49,082,776.11)
and cooperative enterprise
II Operation profit (596,951,946.96) (466,675,002.56)
Add: non-business income 787,454,425.82 390,940,709.45
Less: non-business expense 4,739,263.73 -
Including: disposal loss on non-current assets 4,639,263.73 -
III Total interest 185,763,215.13 (75,734,293.11)
Less: income tax expense - 16,949,151.06
IV Net profit 185,763,215.13 (92,683,444.17)
V Earnings per share
(I) Basic earnings per share Not applicable Not applicable
(II) Diluted earnings per share Not applicable Not applicable
VI Other comprehensive income - -
VII Total comprehensive income 185,763,215.13 (92,683,444.17)
-5-
Shenzhen Nanshan Power Co., Ltd English
Year up to December 31, 2011
Consolidated Statement of Cash Flow
Unit: RMB Yuan
Amount of Amount of last
Item Note
current year year
I. Cash flow from operating activities
Cash from selling commodities or offering labor service 2,862,823,434.28 2,288,118,410.70
Other cash received relating to operating activities (V)42(1) 1,095,531,688.86 400,017,049.50
Subtotal of cash inflows from operating activities 3,958,355,123.14 2,688,135,460.20
Cash paid for goods and services 3,458,138,395.82 2,398,061,926.94
Cash paid to and for employees 122,354,380.02 106,943,679.13
Cash paid for taxes and surcharges 85,020,697.83 135,374,801.61
Cash paid for other operating activities (V)42(2) 20,556,308.21 21,857,107.55
Subtotal of cash outflows from operating activities 3,686,069,781.88 2,662,237,515.23
Net cash flow from operating activities 272,285,341.26 25,897,944.97
II. Cash flows from investing activities
Cash received from recouping the capital outlay 233,761,500.00 -
Net cash received from the disposal of fixed assets，
5,830,593.98 19,183,608.02
intangible assets and other long-term assets
Cash received from disposal of subsidiary or other
operating business units - 34,730,422.00
Subtotal of cash inflows from investing activities 239,592,093.98 53,914,030.02
Cash paid to acquire or construct fixed assets, intangible
assets and other long-term assets 118,967,984.75 91,699,799.08
Cash paid for investment 47,881,000.00 127,315,000.00
Subtotal of cash outflows from investing activities 166,848,984.75 219,014,799.08
Net cash flows from investing activities 72,743,109.23 (165,100,769.06)
III. Cash flows from financing activities
Cash received from borrowings 4,606,524,953.89 3,954,400,000.00
Cash received relating to other investing activities (V)42(3) - 12,800,000.00
Subtotal of cash inflows from financing activities 4,606,524,953.89 3,967,200,000.00
Cash repayments of debts 4,613,100,000.00 3,381,120,000.00
Dividends paid, profit distributed or interest paid 247,230,099.58 136,540,083.21
Thereof, dividend and profit paid by subsidiaries to minor
shareholders - -
Cash payments relating to other investing activities (V)42(4) 52,536,060.00 74,838,156.81
Subtotal of cash outflows from financing activities 4,912,866,159.58 3,592,498,240.02
Net cash flows from financing activities (306,341,205.69) 374,701,759.98
IV. Effect of changes in foreign exchange rate on cash and
cash equivalents (755,066.72) (474,222.48)
V. Net increase of cash and cash equivalents 37,932,178.08 235,024,713.41
Plus: beginning balance of cash and cash equivalents (V)43(2) 591,386,814.04 356,362,100.63
VI. Ending balance of cash and cash equivalents (V)43(2) 629,318,992.12 591,386,814.04
-6-
Shenzhen Nanshan Power Co., Ltd English
Year up to December 31, 2011
Cash Flow Statement
Unit: RMB Yuan
Amount of Amount of last
Item Note
current year year
I Cash flow from business operations
Cash received from selling goods and providing services 1,488,063,617.89 779,481,671.67
Received other cash relating to business operations 408,298,789.45 245,609,824.04
Subtotal cash inflow from business operations 1,896,362,407.34 1,025,091,495.71
Cash paid for purchasing goods and receiving services 1,438,945,047.77 931,517,958.88
Cash paid for employees 73,529,415.16 61,727,864.89
Tax payments 4,324,863.93 5,562,742.97
Cash paid for other things relating to business operations 30,206,802.30 18,614,768.21
Subtotal cash outflow for business operations 1,547,006,129.16 1,017,423,334.95
Net cash flow from business operations 349,356,278.18 7,668,160.76
II Cash flow from investment activity
Cash received from recouping the capital outlay 233,761,500.00 -
Net cash received from disposing fixed assets, intangible
111,378.00 -
assets and other long-term assets
Net cash received from disposing subsidiary and other
- 34,730,422.00
business unit
Received other cash relating to investment activity 380,226,906.00 265,076,059.57
Subtotal cash inflow from investment activity 614,099,784.00 299,806,481.57
Cash paid for purchasing fixed assets, intangible assets and
34,750,295.15 37,016,454.22
other long-term assets
Cash paid for investment 56,841,000.00 127,315,000.00
Cash paid for other things relating to investment activity 591,135,987.91 418,080,000.00
Subtotal cash outflow for investment activity 682,727,283.06 582,411,454.22
Net cash flow from investment activity (68,627,499.06) (282,604,972.65)
III Cash flow from financial activity
Cash received from loan 2,788,924,953.89 2,658,000,000.00
Received other cash relating to financial activity 238,028,176.33 -
Subtotal cash inflow from financial activity 3,026,953,130.22 2,658,000,000.00
Cash paid for debt 3,126,100,000.00 2,049,000,000.00
Cash paid for distribution of dividend profit and profit or
147,832,985.16 100,257,551.56
interest payment
Subtotal cash outflow from financial activity 3,273,932,985.16 2,149,257,551.56
Net cash flow from financial activity (246,979,854.94) 508,742,448.44
IV Influence of change in exchange rate on cash and cash
32,392.53 (1,440.42)
equivalents
V Net increase on cash and cash equivalents 33,781,316.71 233,804,196.13
Add: Balance of cash and cash equivalents at the beginning (XI)6(2)
269,369,131.18 35,564,935.05
of the year
(XI)6(2)
VI Balance of cash and cash equivalents at the end of the year 303,150,447.89 269,369,131.18
-7-
Shenzhen Nanshan Power Co., Ltd
Year end to December 31, 2011
Statement of changes in consolidated stockholder equity
Unit: RMB
Current amount Previous amount
Shareholders’ equity belonging to the parent company Shareholders’ Shareholders’ equity belonging to the parent company
Item equity Total Minor Total
belonging to shareholders’ shareholders’ shareholders’
Stock Capital Surplus Undistributed the parent equity Stock Capital Surplus Undistributed equity equity
capital surplus reserve profit company capital surplus reserve profit
I. Ending balance of 332,908,397.6 1,932,458,350. 602,762,596.0 363,629,927. 332,908,397.
602,762,596.00 363,629,927.51 436,541,567.35 196,615,862.35 551,180,245.55 205,410,615.98 2,055,891,782.64
previous year 0 81 0 51 60
Plus: Change of
- - - - - - - - - - - -
accounting policy
Previous error correction - - - - - - - - - - - -
II. Beginning balance of 332,908,397.6 1,932,458,350. 602,762,596.0 363,629,927. 332,908,397.
602,762,596.00 363,629,927.51 436,541,567.35 196,615,862.35 551,180,245.55 205,410,615.98 2,055,891,782.64
current year 0 81 0 51 60
III. Increase/decrease in (62,176,421.13 (44,647,357.76
- - - 17,529,063.37 - - - (114,638,678.20) (8,794,753.63) (123,433,431.83)
current year ) )
(I) Net profits - - - 17,529,063.37 (8,497,451.22) 9,031,612.15 - - - (114,638,678.20) (8,794,753.63) (123,433,431.83)
(II) Other
- - - - - - - - - - - -
comprehensive income
Subtotal of Items (I) and
- - - 17,529,063.37 (8,497,451.22) 9,031,612.15 - - - (114,638,678.20) (8,794,753.63) (123,433,431.83)
(II) above
Capital paid in and
- - - - - - - - - - - -
reduced by shareholders
1. Capital paid in by
- - - - - - - - - - - -
shareholders
-8-
Shenzhen Nanshan Power Co., Ltd
2. Amounts of
share-based payments
- - - - - - - - - - - -
recognized in
shareholders' equity
3. Others - - - - - - - - - - - -
(53,678,969.91 (53,678,969.91
(IV) Profit distribution - - - - - - - - - -
) )
1. Appropriations to
- - - - - - - - - - - -
surplus reserves
2. Distribution to (53,678,969.91 (53,678,969.91
- - - - - - - - - -
shareholders ) )
3. Others - - - - - - - - - - - -
(V) Internal
carry-forward of - - - - - - - - - - - -
shareholders' equity
1. Capital surplus
- - - - - - - - - - - -
turned to stock capital
2. Surplus reserve turned
- - - - - - - - - - - -
to stock capita
3. Surplus reserve used
- - - - - - - - - - - -
for making up losses
4. Others - - - - - - - - - - - -
IV. Ending balance of 332,908,397.6 1,887,810,993. 602,762,596.0 363,629,927. 332,908,397.
602,762,596.00 363,629,927.51 454,070,630.72 134,439,441.22 436,541,567.35 196,615,862.35 1,932,458,350.81
current period 0 05 0 51 60
-9-
Shenzhen Nanshan Power Co., Ltd
Year up to December 31, 2011
Statement of changes in stockholder equity
Unit: RMB
Current amount Previous amount
Item Total Total
Undistributed Undistributed
Stock capital Capital surplus Surplus reserve shareholders’ Stock capital Surplus reserve shareholders’
profit Capital surplus profit
equity equity
I. Ending balance of previous year 602,762,596.00 288,769,132.47 332,908,397.60 234,504,714.54 1,458,944,840.61 602,762,596.00 288,769,132.47 332,908,397.60 327,188,158.71 1,551,628,284.78
Plus: Change of accounting policy - - - - - - - - - -
Previous error correction - - - - - - - - - -
II. Beginning balance of current
602,762,596.00 288,769,132.47 332,908,397.60 234,504,714.54 1,458,944,840.61 602,762,596.00 288,769,132.47 332,908,397.60 327,188,158.71 1,551,628,284.78
year
III. Increase/decrease in current
- - - 185,763,215.13 185,763,215.13 - - - (92,683,444.17) (92,683,444.17)
year
(I) Net profits - - - 185,763,215.13 185,763,215.13 - - - (92,683,444.17) (92,683,444.17)
(II) Other comprehensive
- - - - - - - - - -
income
Subtotal of Items (I) and (II)
- - - 185,763,215.13 185,763,215.13 - - - (92,683,444.17) (92,683,444.17)
above
Capital paid in and reduced by
- - - - - - - - - -
shareholders
1. Capital paid in by shareholders - - - - - - - - - -
2. Amounts of share-based
payments recognized in - - - - - - - - - -
shareholders' equity
3. Others - - - - - - - - - -
(IV) Profit distribution - - - - - - - - - -
1. Appropriations to surplus
- - - - - - - - - -
reserves
2. Distribution to shareholders - - - - - - - - - -
3. Others - - - - - - - - - -
(V) Internal carry-forward of
- - - - - - - - - -
shareholders' equity
1. Capital surplus turned to
- - - - - - - - - -
stock capital
2. Surplus reserve turned to stock
- - - - - - - - - -
capita
3. Surplus reserve used for
- - - - - - - - - -
making up losses
4. Others - - - - - - - - - -
IV. Ending balance of current
602,762,596.00 288,769,132.47 332,908,397.60 420,267,929.67 1,644,708,055.74 602,762,596.00 288,769,132.47 332,908,397.60 234,504,714.54 1,458,944,840.61
period
- 10 -
（I）Company profile
Shenzhen Nanshan Power Co., Ltd. (hereinafter referred to as ―the Company‖) is a limited liability company
founded through the reorganization of a foreign-funded enterprise upon the approval by Shen Fu Ban Fu [1993]
No. 897 Document of General Office of Shenzhen Municipal People's Government. When founded, the
company had total 103,000,000.00 shares in RMB.
With approval of S.Z.B. Fu [1993] NO. 179 Documents of original Shenzhen Security Management Office, our
company separately issues 40 million shares of common stocks and 37 million shares of foreign stocks listed in
domestic to investors at home and abroad, which were listed in Shenzhen Stock Exchange separately on July 1,
1994 and November 28, 1994. After issuing, stock of our company changed to be 180 million shares. With stock
bonus, stock of our company on December 31, 2011 is 602,762,596 shares.
The Company is headquartered in Shenzhen City, Guangdong Province, China.
The Company and its subsidiaries (hereinafter jointly referred to as ―the Group‖) are mainly engaged in power
and supply production, power plant construction, fuel oil trading, real estate development, consultative
engineering, sludge drying, etc.
The Company doesn’t have any controlling shareholder or actual controller, and Shenzhen Energy Group Co.,
Ltd. (hereinafter referred to as ―Energy Group‖ is the largest shareholder of the Company.
(II) Significant accounting policies, accounting estimates and previous errors of the Company
1. Compilation basis of financial statements
The group is in strict adherence to the Accounting Principle for Business Enterprises promulgated by the
Ministry of Finance on February 15th, 2006. Besides, the group has exposed relevant financial information
according to the General Stipulations of Information Exposure, Compilation and Report Regulations of
Company with Open Security Issuance No. 15—Financial Report (2010 Revision).
Continuous operation
By the end of December 31, 2011, total amount of current liabilities of our group exceeds RMB 489,723,989.85
than total current assets. Meanwhile, as stated in ―contingency‖ of note (VII), our company, in terms of liability
and compensation affairs after termination of option contract, failed to reach a consensus with Jierun (Singapore)
Private Company (hereinafter referred to as ―Jierun Company‖ ) as of the date when the financial report is
proved to be disclosed. It is not ruling out resolving dispute by judiciary means. Unspent bank credit limit of our
group is RMB 1,070,322,657.14, which can satisfy the capital demand of our group. Meanwhile, our company
thinks that the issue stated in ―contingency‖ of note (VII) will not cause significant cash outflow in 2012.
Therefore, this financial report is worked out on the basis of going-concern assumption.
Bookkeeping Basis and Pricing Principle
The Group takes accrual system as accounting basis. Except some financial instruments are measured by fair
value, the financial statements take historical cost as valuation basis. If any asset depreciates, relevant
depreciation reserve shall be accrued according to related regulations.
- 11 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
Comply with Statement of Accounting Standard for Business Enterprise
The financial statement gives a true and complete view of consolidated financial position of the Company as of
December 31, 2011 and of its consolidated performance and cash flow for the 2011 year then ended in
accordance with requirements of accounting standards for business enterprise.
3. Fiscal period
A fiscal year of the Group is a calendar year from Jan. 1 to Dec. 31.
4. Account standard currency
The Group takes Renminbi (RMB), the currency in major economic environment of the Group, as account
standard currency. The financial statements were compiled in RMB.
5. Accounting processes of mergers under common control and mergers not under common control
A merger may be under common control or not.
5.1 Mergers under common control
Merger under common control means a merger upon which both or all of the participants are under the
non-temporary final control of the same party or the same parties before and after the merger.
Assets and liabilities that the merging party obtains upon the merger shall be measured according to the merged
party’s book value of such assets and liabilities on the merger date. The balance between the book value of net
assets the merging party obtains and the book value of consideration the merging party pays for the merger (or
total face value of issued shares) shall be used for adjusting stock premium in capital surplus; if stock premium
is not enough for write off, retained earnings shall be adjusted.
All direct expenses the merging party spends for the merger shall be recorded in current profit and loss at the
time of occurrence of such expenses.
5.2 Mergers without under common control and relevant business reputation
Merger without under common control means a merger upon which the participants are not under the final
control of the same party or the same parties before and after the merger.
- 12 -
(II) Significant accounting policies, accounting estimates and previous errors of the Company –
Continued
5. Accounting processes of mergers under common control and mergers not under common control
– Continued
5.2 Mergers without under common control and relevant business reputation– Continued
Identifiable assets, liabilities or contingent liabilities obtained from the purchased party upon a merger shall be
measured by fair value on the date of purchase. The combined cost is larger than the gap of acquiree’s
identifiable fair value of net assets obtained in the merging. It is adopted as an asset, confirmed as commercial
reputation and has to receive initial measurement and calculation according to the cost. If the merger cost is
smaller than the fair value of all identifiable net assets obtained from the purchased party via the merger, the
purchasing party shall recheck the fair value of identifiable assets, liabilities or contingent liabilities obtained
from the purchased party and the measurement of merger cost, and then record the after-recheck balance in
current profit and loss.
Since the commercial reputation formed in the merging is independently listed and reported in the combined
financial statement and calculated and measured according to the cost by deducting accumulative depreciation
reserve; the commercial reputation has to at least implement depreciation test at the end of each year.
That is to say, the account value of commercial reputation is amortized into the assets group or assets
combination beneficiary from merging coordination effect as of the purchasing date. Impairment test shall be
combined with related asset groups or combination of asset groups. Namely the book value of business
reputation shall be apportioned to asset groups or combination of asset groups in a reasonable way as of the date
of purchase, if the recoverable amount of the asset groups or combination of asset groups containing the
apportioned business reputation is below relevant book value, loss from depreciation shall be identified. The
amount of such loss from depreciation shall be used for writing off the book value of business reputation
apportioned to the asset groups or combination of asset groups, and then offsetting the book value of other assets
beyond the business reputation in the asset groups or combination of asset groups proportionally according to
weight.
Recoverable amount shall be the higher between the balance of fair value of depreciated assets minus the
disposal expense or the present value of estimated future cash flow of depreciated assets. Fair value of assets
shall be determined according to the price fixed in sales agreement of fair transaction; where an asset is not
under a sales agreement but on an active market, its fair value shall be determined according to the buyer’s offer
for such asset; Where an asset is neither under a sales agreement nor on an active market, its fair value shall be
estimated on the basis of the optimal information available. Herein disposal expense covers legal fee, taxes and
fees and handling charge related to asset proposal as well as direct expense for making the asset marketable; the
present value of estimated future cash flow of depreciated asset shall be determined according to the discounted
amount of estimated future cash flow that may be generated during continuous use and final disposal at a proper
discount rate.
The depreciation losses of commercial reputation are calculated into the profits and losses in the period upon
occurrence; besides, they are not transferred back in the future accounting period.
- 13 -
6. Compilation methods of consolidated financial statements
The scope of consolidation of financial statements shall be determined on the basis of control. Herein control
means a right upon which the Group can make decision on the financial and operation policies of another
enterprise and gain profits from the operating activities of the enterprise herefrom.
As for the subsidiary treated by the group, business achievements and cash flow before treatment date (date of
losing control right) have been properly included in the combined profits statement and combined cash flow
statement.
As for the subsidiary obtained under different control conditions through merging, business achievements and
cash flow as of purchasing date (date of obtaining control right) have been properly included in the combined
profits statement and combined cash flow statement. It is not necessary to adjust the amount at beginning of
period and contrast amount in the combined financial statement.
(II) Significant accounting policies, accounting estimates and previous errors of the Company -
Continued
6. Compilation methods of consolidated financial statements
As for the subsidiary obtained under the same control conditions through merging, it is taken as subsidiary’s
integration into the group combination scope as of control date by ultimate control party no matter whether
merging has occurred at any time of report period. Business achievements and cash flow as of the earliest period
of report have been properly included in the combined profits statement and combined cash flow statement.
Significant accounting policies and fiscal periods of subsidiaries are determined according to the unified
accounting policies and fiscal period of the Company.
All major accounts and transactions between the Company and a subsidiary or subsidiaries are written off at the
consolidation of financial statements.
The share of subsidiary owner’s equity not belonging to mother company is adopted as the minority owner’s
equity. In the combined balance sheet, owner’s equity is listed according to ―minority owner’s equity‖. The
share of subsidiary net profits and losses in the period belonging to minority owner’s equity is listed in the
combined profits statement under the net profit column according to ―minority owner’s equity‖.
Part of owners’ equity of subsidiaries that doesn’t belong to the parent company shall be taken as minor
shareholders’ equity and recorded under ―minor shareholders’ equity‖ of shareholders’ equity in a consolidated
balance sheet. Part of current profit and loss of subsidiaries as minor shareholders’ equity shall be recorded in
―minor shareholders’ profits and losses‖ of net profits in a consolidated profit statement.
Where a subsidiary’s loss borne by minor shareholders exceeds the shares of the minor shareholders in the
beginning owners’ equity of the subsidiary, the surplus shall offset minor shareholders’ equity. As for purchasing
of subsidiary minority stock right or transaction due to treatment of partial stock right investment but not losing
subsidiary control right, it has to calculate as equity transaction, adjust the account value belonging to mother
company owner’s equity and minority owner’s equity and reflect modification of relevant equity in the
subsidiary. The gap between adjustment sum of minority owner’s equity and fair value of paid/received
corresponding price is adopted to adjust the capital reserve; once the capital reserve is not enough to set off, it
has to adjust the reservation benefits.
Once it loses the control right to original subsidiary due to treatment of partial stock right investment or other
reason, it has to calculate and measure the left stock right for the second time according to the fair value on
control right losing date. The following gap is calculated into the investment benefits in the period losing
control right: ―sum total of corresponding price in treatment of stock right and fair value of left stock right‖
minus ―net assets share sustainably calculated as of purchasing date of original subsidiary according to the
original stock ratio‖. Other comprehensive benefits related to the stock right investment of original subsidiary
are transferred into the investment benefits in the period once losing control right.
- 14 -
7. Determination criteria of cash and cash equivalents
Cash means cash in treasury and bank deposits that may be used for payment at any moment. Cash equivalents
mean short-term investments with strong liquidity, apt to converting into known amount of cash and bearing
very small risk of value change.
(II) Significant accounting policies, accounting estimates and previous errors of the Company -
Continued
8. Foreign currency operations
For initial identification, foreign currency transactions are converted according to the spot exchange rate on the
trading day.
On the balance sheet date, foreign currency monetary items are converted to RMB according to the spot
exchange rate on the date, all the balance of exchange arising from the difference between the spot exchange
rate on the balance sheet date and that of previous balance sheet date or at initial identification, except (1) the
balance of exchange of special foreign currency borrowings that conforms to capitalization requirements is
capitalized during the capitalization period and recorded in the cost of related assets; (2) the balance of exchange
of hedging instruments for evading foreign exchange risks is treated in hedging accounting methods; (3) the
balance of exchange arising from available-for-sale foreign currency nonmonetary items (e.g. stocks) and the
balance of exchange arising from book balance variations of available-for-sale monetary items exclusive of
post-amortization cost are identified as other comprehensive incomes and recorded in capital surplus, shall be
recorded in current profit and loss.
Foreign currency nonmonetary items measured by historical cost are measured according to the account
standard currency amount converted according to the spot exchange rate on the trading day. Foreign currency
nonmonetary items measured by fair value are converted according to the spot exchange rate on the date of
determination of fair value, and the balance between the converted account standard currency amount and
original account standard currency amount is taken as fair value change (inclusive of change in exchange rate)
and recorded in current profit and loss or identified as other comprehensive income and recorded in capital
surplus.
9. Financial instruments
Once the group becomes one party of financial tools contract, it has to confirm one financial asset or financial
liability. It has to calculate and measure financial assets and financial liabilities at the initial confirmation. As for
the financial assets and financial liabilities calculated and measured according to fair value and whose
modification is calculated into the profits and losses in the period, it has to directly calculate relevant transaction
expense into the profits and losses column; as for other types of financial assets and financial liabilities, it has to
calculate relevant transaction expense into the initial confirmation sum.
9.1 Confirmation measures of fair value
Fair value means the amount of asset exchange or repayment of debt conducted between both parties familiar
with related situations in a voluntary way during a fair transaction. Where an active market of a financial
instrument exists, the Group determines the fair value of such financial instrument according to the quotations
on the active market. Where an active market of a financial instrument doesn’t exist, the Group determines the
fair value of such financial instrument by estimation techniques. Herein estimate techniques include referring to
the prices of latest market transactions between voluntary parties familiar with related situations, referring to
current fair values of other financial instruments the same as the financial instrument in essence, cash flow
discount method, option pricing model, etc.
9.2 Actual interest rate method
The actual interest rate method refers to calculation of amortization cost, interest income or expenditure in
various periods according to the actual interest rate of financial assets and financial liabilities (including one
group of financial assets and financial liabilities). The actual interest rate refers to the interest rate by converting
―future cash flow of financial assets and financial liabilities within the expected lasting period or applicable
shorter period‖ into the current account value of financial assets and financial liabilities.
During the calculation of actual interest rate, the group has to estimate the future cash flow
(not consider future credit losses) on the basis of considering all the contract terms of
- 15 -
financial assets and financial liabilities; at the same time, it has to consider various charges,
transaction expenses and discount or premium paid or charged by various parties of financial
assets or financial liabilities contracts and belonging to a part of actual interest rate.
(II) Significant accounting policies, accounting estimates and previous errors of the Company - Continued
9. Financial instruments - Continued
9.3 Classification, identification and measurement of financial assets
At initial identification, financial assets are classified into financial assets that are measured by fair value and
whose variation is recorded in current profit and loss; hold-to-maturity investment; loans and receivables;
available-for-sale financial assets. For financial assets traded in a conventional way, their identification and
identification termination shall accord with the accounts of the trading day.
The financial assets of the Group include loans and receivables.
Loans and receivables
Herein loans and receivables mean non-derivative financial assets that have fixed or definable recoverable
amount and for which there are no quotations on relevant active market. The loans and receivables as financial
assets of the Group include bills receivable, accounts receivable, dividends receivable and other receivables, etc.
Subsequent measurement is made for such loans and receivables according to actual interest rate and
post-amortization cost. Gain or loss from identification termination, depreciation or amortization is recorded in
current profit and loss.
9.4 Depreciation of financial assets
Except for the financial assets calculated and measured according to fair value and whose modification is
calculated into the profits and losses in the period, the Group examines the book value of other financial assets
on every balance sheet date, and accrue depreciation reserve if any objective evidence indicates a financial asset
depreciates. It has revealed that objective evidence of financial assets depreciation refers to the matters occurred
upon initial confirmation of financial assets, with certain influence on the expected future cash flow of financial
assets and the enterprise can reliably calculate and measure the influence.
The objective evidence of financial assets depreciation includes the following observable matters:
(1) The issuer or debtor is trapped in a serious financial trouble;
(2) The debtor breaches any of the contract provisions, e.g. fails to pay or delays the payment of interests or the
principal;
(3) The Group makes any concession against the debtor trapped in a financial trouble in consideration of
economic, legal or other factors;
(4) The debtor is likely to go bankrupt or carry out other financial reorganizations;
(5) A financial asset can’t be traded on the active market any more because the issuer is trapped in a major
financial trouble;
(6) It’s impossible to identify whether the cash flow of certain asset in a combination of financial assets has
decreased or not, but it’s found that the estimated future cash flow of such combination of financial assets as of
initial identification has decreased indeed and such decrease is measurable after overall appraisal according to
public data, including:
- The paying ability of the debtor of this combination of financial assets has been worsened gradually;
- An event that may make a debtor fail to pay for the combination of financial assets occurs in the country or
region where the debtor is;
(7)Any major unfavorable change occurs to technical, market, economic or legal environment or others in
which releaser of equity tools operates its business, as a result, the investor of the equity instrument may fail
to recover its cost of investment;
(8) The fair value of the equity instrument investment drops sharply or in a non-temporary way;
(9) Other objective evidences that show the depreciation of financial asset.
- 16 -
(II) Significant accounting policies, accounting estimates and previous errors of the Company -
Continued
9. Financial instruments - Continued
9.4 Depreciation of financial assets - Continued
- Financial assets depreciation calculated and measured through amortization cost
In case of depreciation in the financial assets calculated and measured through amortization cost, it has to
reduce the account value and record in the expected future cash flow value confirmed according to original
interest rate discount of financial assets (excluding in-occurred future credit losses) and confirm the reduced
sum into depreciation losses and calculate into the profits and losses in the period. After the loss from
depreciation of such financial asset has been identified, where any objective evidence indicates that the value of
the financial asset has recovered and such recovery is objectively related to an event that occurs after the
identification of loss, the originally identified loss from depreciation is written back, but the post-writeback
book value shall not be larger than the post-amortization cost of the financial asset on the date of writeback on
the assumption that no reserves are withdrawn for depreciation.
The Group conducts impairment test for financial assets in a large individual amount; conduct separate
impairment test for other financial assets or composite impairment test for a combination of financial assets with
similar risk characteristics inclusive of other financial assets. For financial assets (no matter in a large individual
amount or not) for which depreciation isn’t found through separate test, impairment test is repeated for a
combination of financial assets with similar risk characteristics. Financial assets for which loss from
depreciation has been identified separately shall be excluded from a combination of financial assets with similar
risk characteristics under impairment test.
9.5 Transfer of financial assets
The identification of a financial asset will be terminated under any of the circumstances as follows: The contract
right to receive the cash flow upon this financial asset terminates; (2) the financial asset has been transferred,
and almost all of risks and returns upon the ownership of the financial asset has been transferred to the
transferee; (3) the financial asset has been transferred, and the enterprise gives up the control of the financial
assets although it neither transfers nor reserves almost all of risks and returns upon the ownership of the
financial asset.
Where the Company neither transfers or reserves almost all of risks and returns upon the ownership of a
financial asset nor gives up the control of the financial asset, the financial asset is identified according to the
extent of continuous involvement in the transferred financial asset, and related liabilities are identified. Herein
the extent of continuous involvement in the transferred financial asset means the risk level on which the
enterprise is upon the value change of the financial asset.
Where the integral transfer of a financial asset meets the identification termination requirements, the balance
between book value of transferred financial asset plus the consideration received upon the transfer and
accumulative fair value change originally recorded in other comprehensive incomes is recorded in current profit
and loss.
Where the partial transfer of a financial asset meets the identification termination requirements, the book value
of the transferred financial asset is apportioned to the part under identification termination and the rest, and the
balance between consideration received upon the transfer plus accumulative fair value change apportioned to
the identification termination part plus originally recorded in other comprehensive incomes and the apportioned
book value above is recorded in current profit and loss.
- 17 -
(II) Significant accounting policies, accounting estimates and previous errors of the Company -
Continued
9. Financial instruments - Continued
9.6 Classification, recognition and measurement of financial liabilities
The group has to confirm the released financial tools into financial liabilities or equity tools according to the
essence of arrangement of financial tools contract and definition of financial liabilities and equity tools.
At initial identification, financial liabilities are classified into financial liabilities that are measured by fair value
and whose variation is recorded in current profit and loss and other financial liabilities.
Financial liabilities of the Group belong to other financial liabilities.
Other financial liabilities
Consequent measurement is conducted for derivative financial liabilities that are linked with an equity
instrument for which there are no quotations on the active market and fair value can’t be reliably measured and
whose settlement is subject to the delivery of such equity instrument according to cost. Consequent
measurement is conducted for other financial liabilities according to actual interest rate and post-amortization
cost, gain or loss from identification termination or amortization is recorded in current profit and loss.
9.7 Identification termination of financial liabilities
The identification of a financial liability can’t be fully or partially terminated until all or part of the current
obligations upon the financial liability has been dissolved. The Group (the debtor) signs an agreement with the
creditor in respect of substituting new financial liability for existing financial liability, moreover, where the
provisions of new financial liability are different from those of existing financial liability, the identification of
existing financial liability shall be terminated, meanwhile, the new financial liability shall be identified.
Where the identification of a financial liability is fully or partially terminated, the balance between the book
value of the part under identification termination and the paid consideration (including noncash financial asset
transferred out or new financial liability to be borne) is recorded in current profit and loss.
9.8 Offset between financial assets and financial liabilities
Where the Group has the legal right to offset identified financial asset and financial liability and can execute
such legal right presently, meanwhile, plans to make net value settlement or encash the financial asset and pay
off the financial liability, such financial asset and financial liability are recorded in the balance sheet according
to the balance after offset. Under other circumstances, financial assets and financial liabilities shall be recorded
respectively in a balance sheet rather than offset each other.
9.9 Equity instruments
Equity instrument means a contract that can certify the Group’s residual equity in assets after the deduction of
all liabilities. During the release of equity tools, it has to deduct transaction expense in the received
corresponding price and then increase owner’s equity.
Various distributions (exclusive of stock dividend) of the Group to equity instrument holders bring in the
decrease of shareholders’ equity. The Group doesn’t identify any fair value change of equity instrument.
- 18 -
(II) Significant accounting policies, accounting estimates and previous errors of the Company –
Continued
10. Receivables
10.1 Receivable account with serious single sum and single withdrawal of bad debt reserve
Judgment basis or sum standard of The Group identifies a receivable of RMB 2 million and above as
serious single sum receivable in a large individual amount.
The Group conducts impairment test for receivables in a large
individual amount, and composite impairment test for a
Withdrawal method of serious single combination of financial assets with similar risk characteristics
inclusive of financial assets for which depreciation isn’t found
sum and single withdrawal of bad debt through separate test. Receivables for which loss from
reserve depreciation has been identified separately shall be excluded from
a combination of financial assets with similar risk characteristics
under impairment test.
10.2 Receivable expense of withdrawal of bad debt reserve according to combination
Combination confirmation basis
Receivable expense with minor single Receivable expense with minor single sum and with serious single
sum and with serious single sum but sum but without depreciation upon independent deprecation test
without depreciation upon independent
deprecation test
10.3 Receivable expense with small single sum but with single withdrawal of bad debt reserve
Once evidence reveals that a certain receivable expense has rather
Reason for single withdrawal of bad
large credit risks, it has to independently withdraw bad debt
debt reserve
reserve for the receivable expense.
Withdrawal method of bad debt Individual determination method.
reserve
11. Inventories
11.1 Classification of inventories
Inventories of our group mainly include fuels, raw materials and developed products in process. The inventories
are initially priced at the cost. Cost on developing products includes land transferring fees, expense on basic
establishment, expense on construction installation work, borrowing costs incurred prior to completion of
development project and other relevant expenses in the process of development etc. Other cost of inventories
includes cost, processing cost and other expense incurred for transporting inventories to the current place and
state.
11.2 Pricing method on delivering inventories
For delivering real estate development product, adopts specific identification to confirm its real cost. For
delivering other inventories, adopt weighted average to confirm real cost of delivered inventories.
- 19 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
11. Inventories–Continued
11.3 Basis to determine net realizable value and withdrawal method of Inventory depreciation reserve
On the balance sheet date, the inventories are measured by the less one of cost and net realizable value. When
the net realizable value is less than cost, the Inventory depreciation reserve will be accrued. Variable NPV refers
to the sum of estimated inventory sales price minus ―estimated cost, sales expense and relevant tax upon
construction completion‖ in the daily activities. In the confirmation of inventory variable NPV, it has to adopt
obtained evidence as the basis and consider the objective of owned inventory and influence of future matters of
balance sheet.
For the inventories with a large amount and lower unit price, the Inventory depreciation reserve is accrued as
per the class of inventory. For the inventories that relate to the product series produced and sold in the same
region, have the same or similar end use or purpose and that cannot be easily calculated individually from other
items, the withdrawal of Inventory depreciation reserve will be combined. The Inventory depreciation reserve of
other inventory is accrued according to the balance that the cost of individual inventory item exceeds the net
realizable value.
After withdrawal of inventory depreciation reserve, if the previous influencing factor of inventory write-down
has disappeared, which leads to the net realizable value going above its book value, the writeback shall fall in
the original accrued inventory depreciation reserve; the amount of writeback will be counted in the current
profit and loss.
11.4 Inventory accounting system
The inventory accounting system is perpetual inventory system.
12. Long-term equity investment
12.1 Confirmation of investment cost
As to the long-term equity investment formed by business combination, such as long-term equity investment
obtained by business combination under the same control, the share of book value of stockholder's equity of the
mergered party obtained on the date of acquisition is regarded as the initial development cost. With respect to
the long-term equity investment obtained by business combination not under the same control, the combined
cost is regarded as the development cost of long-term equity development. As for merging under numerous
transactions and different control conditions, the cost of long-term stock right investment is the sum total
between account value of assignee’s stock right investment before purchasing date and increased investment
cost on purchasing date. The other equity investment other than the long-term equity investment formed by
business combination is subject to initial measurement at cost.
12.2 Subsequent calculation and measurement and profits & losses confirmation measures
12.2.1. Long-term stock right investment calculated through cost method
The group has to calculate long-term stock right investment of invested unit (without common control or serious
influence, without quotation in the active market, fair value can not be reliably calculated and measured)
according to the cost method; besides, the company financial statement has to calculate the long-term stock
right investment of subsidiary according to the cost method. The subsidiary refers to the invested unit
controllable by the group.
During the calculation through cost method, it has to calculate the long-term stock right investment according to
the initial investment cost; except for the expense paid in the investment obtaining or cash dividend or profit
included in the corresponding price, announced but not distributed, it has to confirm the investment benefits in
the period according to the cash dividend or profit announced and distributed by the invested unit.
- 20 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
12. Long-term equity investment –Continued
12.2.2. Long-term stock right investment calculated through equity method
The group has to calculate the investment of cooperative enterprise and joint venture according to the equity
method. Cooperative enterprise refers to the invested unit that group can impose serious influence; joint venture
refers to the invested unit that group and other investors can implement common control.
During the calculation through equity method and once initial investment cost of long-term stock right
investment is larger than the investment and it has to enjoy the fair value of invested unit’s identifiable net
assets, it does not adjust the initial investment cost of long-term stock right investment; once initial investment
cost is smaller than the investment and it has to enjoy the fair value of invested unit’s identifiable net assets, it
has to calculate gap into the profits and losses in the period and adjust the cost of long-term stock right
investment.
During the calculation through equity method, the investment profits and losses in the period are the net profits
and losses realized by the invested unit for enjoyment or distribution in the year. During the confirmation of
invested unit’s net profits and losses, it has to depend on the fair value of invested unit’s various identifiable
assets and adjust and confirm to the invested unit’s net profits during the group accounting policies and period.
The unrealized internal transaction profits and losses between group and cooperative enterprise and joint
venture is set off according to the group’s stock ratio; it has to confirm the investment profits and losses on such
a basis. However, the unrealized internal transaction losses between group and invested unit are not set off once
it belongs to depreciation losses of transferred assets. As for other owner’s equity modification except for
invested unit’s net profits and losses, it has to adjust the account value of long-term stock right investment,
confirm as other comprehensive benefits and calculate into the capital reserve.
During the confirmation of invested unit’s net losses, it has to adopt ―reduction of account value of long-term
stock right investment and other essential long-term equity of invested unit’s net investment to zero‖ as the
boundary. Besides, once the group bears additional loss obligations for the invested unit, it has to confirm
expected liabilities according to the expected obligations and calculate into the investment losses in the period.
Once the invested unit realizes net profits in the future, the group has to resume confirmation of benefits
distribution share upon compensation of unconfirmed losses distribution share by benefits share.
12.2.3. Disposal of long-term equity investment
With respect to the disposal of long-term equity investment, the balance between its book value and actually
acquired money is counted in the current profit and loss. As to the long-term equity investment calculated by
equity method, the part counted in the shareholders equity at the time of disposal will be transferred to current
profit and loss according to the corresponding proportion.
12.3 Basis to determine the joint control and great influence on investee
The ―control‖ refers to the power to decide on the financial and business policies of an enterprise, on the basis
of which the benefits are gained from enterprise’s business activities. The ―joint control‖ denotes the control
shared for some economic activity in terms of contract provisions; it merely exists under the circumstance of
consensus of investors that share control power in the important financial and operating decisions concerning
the economic activity. The ―great influence‖ refers to the right to participate in the decision-making of financial
and business policies of an enterprise, but the enterprise cannot control or jointly control with other parties the
formulation of the policies. In terms of identification whether to impose control or great influence on investee,
the potential voting rights, including currently convertible company bonds and current exercisable share
warrants held by investing enterprise and other parties, have been taken into account.
- 21 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
12. Long-term equity investment –Continued
12.4 Impairment test method & calculation method of depreciation reserve
We check, on every balance sheet date, whether the long-term equity investment shows evidence of possible
depreciation. If any, we will estimate its recoverable amount. If the recoverable amount of assets is less than its
book value, the depreciation reserve will be accrued as per their balance and counted in the current profit and
loss.
Once the impairment loss of long-term equity investment is confirmed, it will not be reversed in the subsequent
accounting period.
13. Investment real estate
The investment real estate refers to the real estate held for the purpose of gaining rental or capital appreciation
or for the both purposes. It includes rental land use right, land use right held but to be transferred after
appreciation, and rental buildings etc.
The investment real estate is subject to the initial measurement at cost. As to the subsequent expenditure related
to investment real estate, if the economic interest related to the assets is likely to flow in and its cost can
calculated reliably, then it will be counted in the cost of investment real estate.
We shall conduct subsequent measurement of investment real estate by the cost model, as well as depreciation
or amortization according to the policy in accordance with building construction or land use right.
We check, on every balance sheet date, whether investment real estate shows evidence of possible depreciation.
If any, its recoverable amount will be estimated. The recoverable amount of assets is estimated on the basis of
individual asset. If it is difficult to estimate the recoverable amount of individual asset, the recoverable amount
of asset group will be determined on the basis of the belonging asset group of the asset. If the recoverable
amount of the asset is less than its book value, the assets depreciation reserve will be accrued according to their
balance and counted in the current profit and loss.
Once the asset impairment loss of investment real estate is confirmed, it will not be reversed in the subsequent
accounting period.
The balance that disposal consideration such as selling, transfer, scrapping or damage or investment real estate
deducts their book value and related taxation is counted in the current profit and loss.
14 Fixed assets
14.1 Conditions to confirm fixed assets
The fixed assets refer to the tangible assets held for the purpose of commodity production, and provision of
labor, rental or business management, with useful life exceeding a fiscal year. The related economic interests of
the assets may flow into the group; besides, it can not confirm until reliable calculation and measurement of cost.
It has to consider the fixed assets according to the cost and implement initial measurement and calculation in
view of influence of expected abandonment expense elements.
Once the economic interests related to fixed assets may possibly flow in and its cost can be reliably calculated
and measured, it has to calculate subsequent expenditure related to fixed assets into the fixed assets cost and
terminate confirmation of account value of replaced part. It has to calculate other subsequent expenditure into
the profits and losses in the period upon occurrence.
- 22 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
14. Fixed assets –Continued
14.2 Depreciation method of fixed assets
Since the follow-up month that intended serviceable condition for the fixed assets is achieved, except that the
depreciation of gas turbine generator units is accrued by units-of-production method, the depreciation of other
fixed assets will be accrued by straight-line method during useful life.
The useful life, estimated net residual value and annual rate of depreciation are listed as below.
Estimated Net Annual Rate of
Category Useful Life Residual Value Depreciation
Building and structure 20-40 years 10% 2.25%-4.50%
Machinery equipment (except gas
turbine generator unit)
10-20 years 5%-10% 4.5%-9%
Machinery equipment – gas turbine
10% Straight-line method
generator unit (note)
Conveyance 5-12 years 10% 7.5%-18%
Other equipment 5-8 years 10% 11.25%-18%
The estimated net residual value indicates that the fixed assets are assumed to be in the expected state that its
useful life has run out. Currently, it is the amount obtained from the asset disposal of our group, from which the
estimated disposal cost has been deducted.
Note: gas-turbine generator is calculated and depreciated as per working capacity, that is to say, according to
value of equipment, anticipated net residual value and total predicted working hours. The detailed list is as
follows
Depreciation Amount
Company name Fixes assets
(RMB Yuan/hour)
No.1 Generator
4,225.09
Unit
No.3 Generator
The Company 4,401.76
Unit
No.7 Generator
4,407.11
Unit
No.10
Shenzhen New Power Industrial Co., Ltd. (New 3,954.47
Generator Unit
Power Company)
No.1 Generator
1,911.87
Unit
No.2 Generator
688.66
Shenzhen Nanshan Power (Zhongshan) Power Co., Unit
Ltd. No.3 Generator
1,902.68 - 1,937.99
Unit
No.4 Generator
693.18
Unit
No.1 Generator
2,009.43
Unit
No.2 Generator
585.11
Shenzhen Nanshan Power (Dongguan) Weimei Power Unit
Co., Ltd. (―Weimei Power Company‖) No.3 Generator
1,980.18
Unit
No.4 Generator
585.08
Unit
14.3 Impairment test method of fixed assets & calculation method of depreciation reserve
- 23 -
We check, on every balance sheet date, whether the fixed assets show evidence of possible depreciation. If any,
its recoverable amount will be estimated. The recoverable amount of assets is estimated on the basis of
individual asset. If it is difficult to estimate the recoverable amount of individual asset, the recoverable amount
of asset group will be determined on the basis of the belonging asset group of the assets. If the recoverable
amount of the assets is less than its book value, the assets depreciation reserve will be accrued according to their
balance and counted in the current profit and loss.
Once the fixed asset impairment loss is confirmed, it will not be reversed in the subsequent accounting period.
- 24 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
14. Fixed Assets – Continued
14.4 Other specifications
As to the subsequent expenditure concerning fixed asset, if the economic interest related to the fixed asset is
likely to flow in and its cost can be calculated reliably, then it will be counted in the fixed asset cost. And the
recognition of book value of the replaced part will be terminated. The other subsequent expenditures besides
this will be counted in the current profit and loss as it happens.
Once the fixed assets are in the treatment status or expected utilization or treatment can not realize any
economic interests, it has to ultimately confirm the fixed assets. The treatment income of fixed assets (sales,
transfer, wastage or destruction) has to deduct the account value and relevant tax—the gap is calculated into the
profits and losses in the period.
15. Project under construction
The cost of project under construction is determined according to the actual engineering expenditure, including
the expenditure of all works occurring in the construction period, capital borrowing cost before project is up to
the intended serviceable condition, and other related fees. It will be carried over to the fixed asset after the
project is up to the intended serviceable condition.
We check, on every balance sheet date, whether the project under construction shows evidence of possible
depreciation. If any, its recoverable amount will be estimated. The recoverable amount of assets is estimated on
the basis of individual asset. If it is difficult to estimate the recoverable amount of individual asset, the
recoverable amount of asset group will be determined on the basis of the belonging asset group of the assets. If
the recoverable amount of the assets is less than its book value, the assets depreciation reserve will be accrued
according to their balance and counted in the current profit and loss.
Once the impairment loss of project under construction is confirmed, it will not be reversed in the subsequent
accounting period.
16. Borrowing cost
It can be directly classed under the borrowing cost for asset acquisition and construction or for production that
accords with capitalization conditions. The capitalization will begin when both the asset expenditure and
borrowing cost have been incurred, and the acquisition, construction or production activities necessary for asset
reaching the intended serviceable condition or marketable state have begun. The capitalization will stop when
the constructed or produced intended asset is up to serviceable condition or marketable state. The other
borrowing cost will be recognized as expense as it happens in the current period.
The amount obtained after the interest expenses of special borrowing actually incurred in the current period
deducts the interest income of not yet used borrow money gained when it is saved in bank, or the amount of
return on investment gained from temporary investment is capitalized. Generally, the amount of capitalization of
borrowing is confirmed to be the result of the weighed average of assets expenditure (i.e. the part of special
borrowing in excess of cumulative assets expenditure) being multiplied by capitalization rate of used general
borrowing. The capitalization rate is determined according to the weighed average interest rate of general
borrowing.
- 25 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
17. Intangible assets
17.1 Intangible assets
Intangible assets include land use right and software etc.
The intangible assets are subject to initial measurement at cost. Since the intangible asset of with limited useful
life is operational, the balance that its original value deducts estimated net residual value and cumulative
amount of accrued depreciation reserve is averagely amortized by stages by the straight-line method within the
estimated useful life. In the case of uncertainty of useful life, the intangible asset will not be amortized.
The useful life and amortization method of intangible asset with limited useful life is rechecked at the end of the
period, it has to make adjustment once necessary.
17.2 Impairment test method of intangible assets & calculation method of depreciation reserve
We check, on every balance sheet date, whether the intangible asset with certain useful life shows evidence of
possible depreciation. If any, its recoverable amount will be estimated. The recoverable amount of assets is
estimated on the basis of individual asset. If it is difficult to estimate the recoverable amount of individual asset,
the recoverable amount of asset group will be determined on the basis of the belonging asset group of the assets.
If the recoverable amount of the assets is less than its book value, the assets depreciation reserve will be accrued
according to their balance and counted in the current profit and loss.
The intangible assets with uncertain useful life and those not yet up to the serviceable condition are subject to
impairment test annually whether there is evidence of depreciation.
Once the intangible asset impairment loss is confirmed, it will not be reversed in the subsequent accounting
period.
18. Long-term deferred expenses
The long-term deferred expenses are those that have been incurred but should be amortized in the current period
and subsequent periods for more than a year. The long-term deferred expenses are averagely amortized by
stages in the estimated benefit period.
19. Estimated liabilities
Once relevant obligations related to matters are the group contemporary obligations and fulfillment of such
obligations is likely to flow out economic interests and sum of obligations can be reliably calculated and
measured, it has to confirm as expected liabilities.
On the balance sheet date, in the consideration of the risk concerning contingencies, uncertainty, and time value
of money etc, the estimated liabilities is calculated according to the optimal estimation that needs to be paid for
the performance of current obligation. Once the currency time has serious value influence, it has to confirm the
best estimation sum according to the sum upon flow-out and discount of expected future cash.
In the event that the total or partly expectations that need to be paid for the settlement of estimated liabilities are
compensated by a third party, the amount of compensation will be confirmed singly as an asset when it is
confirmed basically that it can be received. Moreover, the amount of compensation confirmed must not exceed
the book value of estimated liabilities.
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
20. Revenue Recognition
- 26 -
20.1 Goods sales revenue
When significant risks and rewards of ownership of goods have been transferred to buyer, no continuous
management right regularly related to ownership is retained, no effective control is conducted on goods sold,
moreover, amount of income may be measured in a reliable way, relevant economic profit may have flown into
enterprise and relevant incurred cost or to be incurred may be measured in a reliable way, implementation of
goods sales revenue will be confirmed.
For revenue from real estate development product, on the condition that, both parties shall sign sale contract and
put on records in land department; real estate development product has been finished and reached to the
anticipated serviceable condition. And it is qualified for acceptance of relevant authorities and equipped with
complete procedures; the buyer has paid stipulated payment on real state according to payment terms of sale
contract and obtained qualification of joining in agreed in sale contract, that is to say when the seller received
total payment on real estate or obtain the right of receive total payment on real estate and the relevant economic
interest can totally inflow into the company, it is recognized to be sale revenue.
20.2 Revenue from Providing Labor Service
It can reliably calculate and measure the labor income; relevant economic interests are likely to flow into the
enterprise; the transaction completion degree can be confirmed reliably; once the occurred and expected
transaction cost can be reliably calculated and measured, it has to confirm the realization of labor income. The
group has to confirm provided labor income on the balance sheet date according to the work completion
percentage. The labor transaction progress is confirmed according to the ratio of occurred labor cost in the total
estimated cost.
If result of service providing business can’t be estimated in a reliable way, service revenue should be confirmed
as amount of incurred service cost expected to be compensated, where incurred service cost is taken as period
charge. If no compensation is expected for incurred service cost, income won’t be confirmed.
21. Government grant
Government grant means monetary and nonmonetary asset acquired from government for free except capital
contributed by government as owner. It has to confirm the government subsidy once it can meet relevant
government subsidy conditions and can be received.
Monetary asset as government grant will be measured as amount received or receivable. Nonmonetary asset as
government grant will be measured as fair value. If fair value can’t be acquired in a reliable way, it will be
measured as notional sum. Government grant measured as notional sum will be included in the current profits
and loss.
Government grant related to asset will be confirmed as deferred income and equally distributed in service life of
relevant asset to be included in current profit and loss.
Government grant related to income used to compensate relevant expense and loss in future period will be
confirmed as deferred income and included in current profit and loss in the period of confirming relevant cost.
Government grant related to income used to compensate incurred relevant expense and loss will be directly
included in current profit and loss.
If confirmed government grant needs to be surrendered，for government grant with relevant balance of deferred
income，book balance of relevant deferred income will be offset while remnant will be included in current profit
and loss. On the contrary, for government grant without relevant deferred income, it will be directly in current
profit and loss.
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
- 27 -
22. Deferred income tax asset/ deferred income tax liability
The income tax includes period income tax and deferred income tax
22.1 Current income tax
On balance sheet date, current income tax liability (or asset) formed during and before current period will be
measured as amount of income tax payable (or repayable) as specified by tax law.
22.2 Deferred income tax asset & deferred income tax liability
For balance of book value of some asset/liability item and its tax base, or temporary difference derived from
balance of book value and tax base of the item, which is not confirmed as asset or liability but tax base can be
fixed as specified by tax law, deferred income tax asset & deferred income tax liability will be confirmed in
balance sheet liability approach.
Generally, all the temporary differences have to confirm relevant deferred income tax; as for deductible
temporary difference, the group is most likely to adopt ―taxable income adopted to deduct temporary
difference‖ as the boundary and confirm relevant assets of deferred income tax. Besides, it does not confirm
relevant assets or liabilities of deferred income tax for the temporary difference concerning initial confirmation
of commercial reputation or initial confirmation of assets or liabilities in the transaction not incurred in the
enterprise merging, without influence on accounting profits and taxable income (or deductible losses) upon
occurrence.
For deductible loss and taxation decrease which can be carried over to following fiscal year, relevant deferred
income tax asset may be confirmed subject to amount of taxable income which is likely to be acquired to deduct
deductible loss and taxation decrease in the future.
The group has to confirm the liabilities of deferred income tax incurred by temporary difference of taxable tax
concerning subsidiary, cooperative enterprise and joint venture except that group can control the turning time of
temporary difference and temporary difference is not likely to turn back within the foreseeable future. As for the
deductible temporary difference concerning subsidiary, cooperative enterprise and joint venture, the group has
to confirm the assets of deferred income tax only when temporary difference is likely to turn back in the
foreseeable future and is expected to deduct taxable income of deductible temporary difference.
On balance sheet date, deferred income tax asset/ liability will be measured as applicable tax rate during period
of recovering relevant asset or paying relevant liability.
Except for transaction directly calculated into other comprehensive benefits or owner’s equity, income tax and
deferred income tax concerning relevant matters and calculated into other comprehensive benefits or owner’s
equity as well as account value of adjustment commercial reputation of deferred income tax incurred by
merging, the rest income tax and deferred income tax or benefits in the period are calculated into the profits and
losses in the period.
On balance sheet date, book value of deferred income tax asset will be reviewed. If it is likely to fail to acquire
sufficient taxable income to deduct profit of deferred income tax asset, book value of deferred income tax asset
will be written down. If it is likely to acquire sufficient taxable income to deduct profit of deferred income tax
asset, such write-down amount shall be subsequently reversed.
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
22. Deferred income tax assets/ Deferred income tax liabilities – Continued
22.2 Deferred income tax assets/ Deferred income tax liabilities – Continued
When possessing legal right to settle with net amount and intending to settle with net amount or acquire asset
and pay for liability synchronously, we will present current income tax asset and current income tax liability as
net amount following deduction.
- 28 -
When possessing legal right to settle current income tax asset and current income tax liability with net amount,
deferred income tax asset and deferred income tax liability are related to income tax collected from identical
taxpaying body by identical tax revenue collection and management department or related to different taxpaying
bodies, but in reverse period for every significant deferred income tax asset and deferred income tax liability,
relevant taxpaying body intends to settle current income tax asset and current income tax liability with net
amount or synchronously acquire asset and satisfy liability, we will present deferred income tax asset and
deferred income tax liability as net amount following deduction
23. Operating lease, finance lease
Finance lease is to virtually transfer all risks and rewards related to ownership of asset. Leases other than
finance lease are operating leases.
23.1 Recording operating lease service as lessee
Rental expense in every stage of lease term will be included in relevant cost of asset and current profit and loss
as straight-line method. Initial direct cost will be included in current profit and loss. Perhaps some rent may be
included in current profit and loss when actually incurred.
23.2 Recording operating lease service as lessor
Rental expense in every stage of lease term will be confirmed as current profit and loss as straight-line method.
Large amount of initial direct cost to be capitalized when actually incurred will be included in current profit and
loss as basic stages identical to that of recognition of rental income. Small amount of initial direct cost will be
included in current profit and loss when actually incurred. Perhaps some rent may be included in current profit
and loss when actually incurred.
24. Other Significant Accounting Policy, Accounting Estimate and Compilation Method p of Financial
Statement
24.1 Employee compensation
Except for compensation due to rescission of employee’s labor relationship, the group has to confirm payable
remuneration as liabilities during the accounting period.
We will participate in social security system for employee set up by government department as specified,
including basic pension insurance, medical insurance, and housing fund and other systems. Expenses involved
will be included in relevant cost of asset and current profit and loss when actually incurred.
We will sever labor relation with employee prior to expiration of labor contract, or encourage employee to
voluntarily accept layoff and put forward suggestion on compensation. If we have formulated formal plan for
severing labor relation or put forward voluntary layoff suggestion and plan to put into effect meanwhile the plan
and suggestion can’t be withdrawn unilaterally, estimated liability produced by compensation for severing labor
relation with employee will be confirmed and included in current profit and loss.
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
24. Other Significant Accounting Policy, Accounting Estimate and Compilation Method p of Financial
Statement – Continued
24.2 Debt restructuring
24.2.1. Debtor’s obligation of recording debt restructuring
For debt liquidated with cash, balance between book value of debt to be restructured and amount of actual
payment will be included in current profit and loss. On the contrary, for debt liquidated with non-cash asset,
balance between book value of debt to be restructured and fair value of non-cash asset transferred will be
included in current profit and loss. Balance between fair value of non-cash asset transferred and book value of
debt to be restructured will be included in current profit and loss. When debt is transferred to capital, balance
- 29 -
between book value of debt to be restructured and fair value of loaner’s share derived from disclaim will be
included in current profit and loss.
It has to transfer debts into debt–reorganization of capital. The margin between ―account value of
re-organization debts and fair value of share owned by creditor upon credit abandonment iscalculated into the
profits and losses in the period.
When other terms of debt are modified, fair value of debt after modification will be taken as entry value of
restructured debt. Balance between book value of debt prior to restructuring and debt restructured will be
included in current profit and loss.
When combination of multiple modes is applied, book value of debt to be restructured will be offset by cash for
payment, fair value of non-cash asset transferred and fair value of loaner’s share successively, then applicable
method under modification mentioned above will be applied.
24.2.2. Creditor’s obligation of recording debt restructuring
For debt liquidated with cash, balance between book balance of credit to be restructured and cash received will
be included in current profit and loss. On the contrary, for debt liquidated with non-cash asset, balance between
book balance of credit to be restructured and fair value of non-cash asset received will be included in current
profit and loss. When debt is transferred to capital, balance between fair value of loaner’s share and book
balance of credit to be restructured will be included in current profit and loss.
It has to transfer debts into debt–reorganization of capital. The gap between ―fair value of debtor’s share and
account balance of re-organization credit‖ is calculated into the profits and losses in the period.
When other terms of debt are modified, fair value of debt after modification will be taken as entry value of
restructured debt. Balance between book value of debt prior to restructuring and debt restructured will be
included in current profit and loss.
When combination of multiple modes is applied, book value of debt to be restructured will be offset by cash for
payment, fair value of non-cash asset transferred and fair value of loaner’s share successively, then applicable
method under modification mentioned above will be applied
When depreciation reserve has been accrued in credit to be restructured, accrual depreciation reserve will be
offset by balances above. Remnant after offset will be included in current profit and loss.
- 30 -
(II) Significant Accounting Policy, Accounting Estimate and Preliminary Mistake of the Company –Continued
25. Utilize important judgment made in the process of accounting policy and critical assumption and
unconfirmed factor adopted by accounting estimate
In the process that our group utilizes accounting policies stated in Note (II), due to uncertainty of business
activity, our group is required to conduct judgment, estimate and assumption for book value of report items that
can not be accurately measured. The judgment, estimate and assumption are based on historical experience of
manager layer of our group, which are made with consideration of other relevant factors. There may be
difference between practical result and estimate of our group. On the basis of above-mentioned going-concern
judgment, estimate and assumption, our group conducts regular re-check. Influence number of changes in
accounting estimate that only affect the current affairs shall be confirmed in the current period; influence
number of changes in accounting estimate that will affect both the current affairs but also affairs in the future
shall be confirmed in current period and future.
- Critical assumption and unconfirmed factor adopted by accounting estimate
On balance sheet date, critical assumptions and uncertainty in accounting estimate that possibly result in
significant adjustment of book value of assets and liability in future mainly includes:
Fixed assets is calculated and depreciated with output method
Our group confirms depreciation in unit quantity of electricity according to value of generator unit, anticipated
quantity of sold electricity and predicated net residual value and calculates according to depreciation in unit
quantity of electricity and practical quantity of sold electricity. On the basis of current industrial policy,
technology, loss, scheduling mode of electric management department and previous experience, management
layer of our group think service life, anticipated quantity of sold electricity, predicted net residual value and
depreciation method are suitable. If there is big difference between practical quantity of sold electricity in the
future and anticipated quantity of electricity, our group will adjust depreciation in unit quantity of electricity.
The adjustment will affect current period and period in the future is credited to depreciation expense of profit
and loss.
Temporary estimated value of fixed assets
Due to long construction period, high construction cost and long completion and settlement time of power plant
project, the generator unit and relevant construction building that reaches to anticipated utilization state shall be
temporarily credited to book according to budgetary estimates, construction cost or practical cost etc. before
transaction settlement for completion of project. After the procedure has been finished, adjust the original
estimated value according to practical cost. If there are big difference between temporary estimated value and
practical cost of generator unit and relevant construction building, it is necessary to conduct corresponding
adjustment for value of fixed assets.
- 31 -
(III) Tax
1. Main categories of taxes and tax rate
Category Tax basis Tax rate
Balance of current substituted Substituted money on value-added tax is
Value-added tax money on value-added tax deducted calculated with 13% or 17% of sale volume
current input value added tax calculated according to provision of tax law
Business tax Business revenue 3% or5%
Urban
Value-added tax and business tax
maintenance and 1%, 5% or 7%
actually paid
construction ax
Education Value-added tax and business tax
surcharge actually paid 3%
Local education Value-added tax and business tax
surcharge actually paid 2%
Business income
Taxable income From 16.5% to25%
tax (note 1)
Added value from assignment of
Land value
state land use right, construction on Four-level progressive tax rate
increment tax
the ground and its attachments.
Calculate according to balance of
For payment in the light of calculated balance of
deducting 30% of original value of
Building tax real estate, tax rate is 1.2%; for payment in the
real estate; rental revenue of real
light of calculated rental revenue, tax rate is 12%
estate
City and town
Area of land actually occupied RMB 4 per square meter
land use tax
Note 1: Income tax rate of our company and its subsidiary is listed as below:
The name of the company and its subsidiary companies The income tax rate
2011 2010
The company 24% 22%
New Power Company 24% 22%
ShenNan Electric Gas Turbine Engineering Technology Co., Ltd.
24% 22%
(―Engineering Company‖)
ShenZhen XieFu Oil Supply Co., Ltd.(―Xiefu Oil Supply Company‖) 24% 22%
ShenZhen ShenNan Environmental Protection Electricity Co.,
25% 25%
Ltd.(―Environmental Protection Company‖)
ZhongShan Power Company 24% 22%
WeiMei Power Company 24% 22%
ShenNan Energy(Singapore) Co., Ltd.(ShenNan Singapore Company) 20% 20%
ShenZhong Real Estate Development Co., Ltd. in ZhongShan
25% 25%
City(―ShenZhong Development Company‖)
ShenZhong Real Estate Investment and Purchase Co., Ltd. in
25% 25%
ZhongShan City(―ShenZhong Real Estate Purchase Company‖)
HuiDong XieFu Port Comprehensive Development Co.,
25% 25%
Ltd(―HuiDong XieFu Company‖)
HuiDong Harbour Development Co., Ltd(―HuiDong Harbour
25% 25%
Company‖)
HongKong Syndisome Co., Ltd(―Syndisome Company‖) 16.5% 16.5%
Our company, New Power Company, Engineering Company and Xiefu Oil Supply Company are enterprises that
are established in special economic zone. Zhongshan Power Company and Weimei Power Company are
foreign-funded enterprises that are engaged in production of energy. Before January 1, 2008, 15%, serves as tax
rate of income tax, is applicable to our company and above-mentioned subsidiary. Since January 1, 2008, it is
gradually transited to 25% national tariff within five years. The applicable tax rate for our company and
above-mentioned subsidiary is 24%.
- 32 -
(III) Tax – Continued
2. Tax preference and approval documents
Approval
Relevant regulation and Approval document Range of Term of
Category Company name policy basis authority number remission validity
Income Tax Law of the
People’s Republic of Since 2008,
China, Notification on free charge From January
Business
Weimei Power Implementing Not for two years 1, 2008 to
income Not applicable
Company Preferential Policy for applicable and half December 31,
tax
Business Income Tax of income tax 2012
the State Council (G.F. for three years
[2007] No. 39 document)
Income Tax Law of the
People’s Republic of Since 2008,
China, Notification on free charge From January
Business Zhongshan
Implementing Not for two years 1, 2008 to
income Power Not applicable
Preferential Policy for applicable and half December 31,
tax Company
Business Income Tax of income tax 2012
the State Council (G.F. for three years
[2007] No. 39 document)
Notification on Adjusting
and Completing
Value-added
Value-added Tax Policy
Environmental tax is free for
Value-ad for Product and Labor Not Not
Protection Not applicable labor of
ded tax with Comprehensive applicable applicable
Company dealing with
Utilization of Resource
sludge
(Financial Tax [2011] No.
115)
Arrangement on
Protecting Income Tax
Income tax
From Double Tax or
paid
Business Evasion of Tax o in
Xingdesheng Not according Not
income Mainland and the Hong Not applicable
Company applicable 10% of total applicable
tax Kong Special
stock
Administration Region
dividend
(State Tax Letter [2006]
No. 884 Document)
S.S. T. N. Dividend is
Shenzhen
Deduction freely charged
Business Income Tax Law of the Nanshan Office
Xingdesheng B. Zi. by income tax Not
income People’s Republic of of State
Company [2011] No. before applicable
tax China Administration
0011 December 31,
of Taxation
Document 2007
- 33 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(IV). Business Combination and Consolidated Financial Statements
1. An Overview of Subsidiaries
(1) Established and Invested Subsidiaries
Unite: RMB Yuan
Wheth
Other
er
amount Amount in
consol
Regist composi minority
Real invested idate
Full name of ered ng net Shar Voti Minority shareholders
Type Core Managing Scope amount at the the
the subsidiaries locatio Registered investm ehol ng shareholders’ ’ equity used
busines end of the financ
n capital ent of ding righ equity to offset
s year ial
subsidia ratio ts against their
statem
ries (%) (%) profit and
ents
loss of
Xie Fu Oil Trade Fuel sale and agent of fuel import 0 Yes 0
Limited
Company 53,300,000.00 26,650,000.00 50 50 45,441,989.78
liability Shenzh
(Noted) company en City
Electricit Technical development of application of 0 Yes 0
New y residual heat; electricity generation from
Electricity 113,850,000.00 113,850,000.00 100 100 -
Joint venture Shenzh Generatio residual heat and combustion engine
Company (Hong Kong) en City n
Electricit Electricity generation from residual heat 0 Yes 118,781,000.72
Zhongshan Zhongs y and combustion engine
Electricity 396,800,000.00 317,440,000.00 80 80 (39,421,000.72)
Joint venture han Generatio
Company (Hong Kong) City n
Engineeri Technology consultation and related 0 Yes 0
ng 10,000,000.00
maintenance and examination of combined 13,520,000.00 100 100 -
Engineering Joint venture Shenzh Consolati recycle electricity generation from fuel gas
Company (Hong Kong) en City on and steam
Electricit USD Establishment and operation of natural gas 0 Yes 0
Weimei y 35,040,000.00 power generation
Electricity 208,102,049.76 70 70 96,944,507.36
Joint venture Donggu Generatio
Company (Hong Kong) an City n
Environmental Engineeri Sludge drying 0 Yes 0
ng 79,000,000.00 79,000,000.00 100 100 -
Protection Joint venture Shenzh
Company (Hong Kong) en City
Limited Harbor Establishment and operation of 0 Yes
Huidong Xiefu liability Huizho Manage 8,620,000.00 comprehensive harbors and related 6,465,001.00 84 84 (6,094,480.45) 7,477,990.45
Company company u City ment equipment
Huidong Harbor Establishment and operation of 0 Yes
Limited Manage miscellaneous harbors, oil docks and fuel
Harbor 10,000,000.00 5,500,000.00 55 55 (111,881.14) 4,611,881.14
liability Huizho ment farm and related equipments
Company company u City
Note: The Company holds 50% of the shares of Xie Fu Oil Company and has a majority voting rights in the board of directors. Therefore, the Company has real control over it,
which is accordingly included into the consolidated financial statements.
- 34 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(IV). Business Combination and Consolidated Financial Statements-Continued
1. An Overview of Subsidiaries-Continued
(2) Subsidiaries consolidated from companies under different control
Unite: RMB
Wheth
er
consol
Regist Amount in
Full name idate
ered Other amount minority
of the Type Registered Real invested Shareho Votin the
locatio Managing Scope composing net Minority shareholders’
subsidiaries Core capital amount at the end lding g financi
n investment of shareholder equity used to
business of the year ratio rights al
subsidiaries s’ equity offset against their
(%) (%) statem
profit and loss of
ents
Shennan Limited Singapo Trade SGD Yes
Agent for fuel, gas
Singapore liability re 1,500,000.00
compan
turbine and its related 6,703,800.00 - 100 100 - 0
Company y
spare parts
Shenzhong Limited Zhongs Housing 177,800,000.00 Housing development, Yes
Real Estate liability han developmen property management,
compan City t sale, tenancy and
Developme y investment on
- - 75 75 20,322,156.00 24,127,844.00
nt commercial housings
Company
Shenzhong Limited Zhongs Housing 60,000,000.00 Housing development, Yes
Real Estate liability han developmen property management,
Company
compan City t selling, leasing and - - 75 75 17,358,150.39 0
y investment on
commercial housings
Xing De Limited Hong Import and HKD Import and export Yes
Sheng liability Kong export 200,000.00
compan
217,807.27 - 100 100 - 0
Company y
Note: On December 5, 2008, Shennan Singapore Company and Shen Ye Investment Management Co., Ltd (Shen Ye Investment Company) signed ―Transfer Agreement on Buying
and Selling 200,000 Common Shares of HONGKONG SYNDISOME CO., LIMITED‖ (hereinafter ―Transfer Agreement‖) and transferred 100% of share ownership in Xing De
Sheng Company (including the part Mrs Fubo holds) to Shen Ye Investment Company at the price of HKD 393,885,100.00. According to the Transfer Agreement, Shen Ye
Investment Company shall pay HKD 1,000,000.00 on the sign date, and pay off the transfer amount within six months after signing the transfer agreement. By the authorized
date of this financial report, Shen Ye Investment Company hasnot paid the total price of equity transfer, which is HKD 392,885,100.00. Therefore, the Company still has
control over Xing De Sheng Company and accordingly includes it into the financial statements.
- 35 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V). Notes on consolidated financial statements
1. Monetary Capital
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Conve Conve
Items Foreign Foreign
rsion RMB rsion RMB
currency currency
rate rate
Cash:
RMB 175,127.11 1.0000 175,127.11 121,987.47 1.0000 121,987.47
HKD 82,656.91 0.8107 67,009.95 82,656.91 0.8509 70,332.77
USD 995.22 6.3009 6,270.78 995.22 6.6227 6,591.04
Euro 1,017.87 8.1625 8,308.37 1,017.87 8.8065 8,963.88
Bank account:
RMB 618,132,096.26 1.0000 618,132,096.26 575,020,508.91 1.0000 575,020,508.91
HKD 826,105.97 0.8107 669,724.11 5,369,706.06 0.8509 4,569,082.89
USD 1,968,962.94 6.3009 12,406,234.51 1,658,289.85 6.6227 10,982,356.19
SGD 98,879.81 4.8679 481,337.03 22,144.87 5.1191 113,361.80
Other monetary
currency
RMB 63,144,299.99 1.0000 63,144,299.99 10,488,747.90 1.0000 10,488,747.90
USD 737.04 6.3009 4,644.01 737.04 6.6227 4,881.19
Total 695,095,052.12 601,386,814.04
Note: Other monetary currency mentioned includes L/G deposit and B/G deposit, which adds up to the total
amount of RMB 62,536,060.00 (December 31, 2010, RMB 10,000,000.00). The bank account contains
the fixed deposit that will be expired in three months and will amount to RMB 3,240,000.00 (December
31, 2010, RMB 0).
2. Notes Receivable
Categories of Notes Receivable
Unit: RMB Yuan
Amount at the end of the Amount in the beginning
Categories year of the year
Bank acceptance - 700,000.00
The Group does not have notes discounted but not yet due at the end of the year, or notes endorsed to transfer
but not yet due at the end of the year.
- 36 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V). Notes on consolidated financial statements-Continued
3. Accounts Receivable
(1) Accounts Receivable Disclosed in Categories
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Categories Book balance Bad debit reserve Book balance Bad debit reserve
Percent Percent Percent Percent
Amount Amount Amount Amount
age (%) age (%) age (%) age (%)
Account receivable
that is a great single
amount and accrues
3,474,613.06 0.37 3,474,613.06 100.00 12,135,091.34 2.32 4,580,704.34 37.75
bad debit reserve
individually with this
amount
Account receivable
that is not a great
single amount, and
that is a great single
934,640,019.03 99.53 - - 508,090,413.69 97.08 - -
amount but not
depreciated through
individual depreciation
text
Account receivable
that is not a great
single amount but 946,915.10 0.10 946,915.10 100.00 3,138,555.10 0.60 391,079.10 12.46
accrues bad debit
reserve individually
Total 939,061,547.19 100.00 4,421,528.16 0.47 523,364,060.13 100.00 4,971,783.44 0.95
The Group defines the account receivable of a great single amount as the account receivable with an
amount over RMB 2,000,000.00 (including RMB 2,000,000.00)
Explanation of age of account receivable
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Age of Percent Percen
account Bad debit Bad debit
Amount age Book value Amount tage Book value
reserve reserve
(%) (%)
Less than
934,298,767.65 99.49 - 934,298,767.65 508,292,525.93 97.12 - 508,292,525.93
1 year
From 1
year to 2 243,363.62 0.03 - 243,363.62 - - - -
years
From 2to
- - - - 6,358,317.76 1.21 641,043.00 5,717,274.76
3 years
More than
4,519,415.92 0.48 4,421,528.16 97,887.76 8,713,216.44 1.67 4,330,740.44 4,382,476.00
3 years
Total 939,061,547.19 100.00 4,421,528.16 934,640,019.03 523,364,060.13 100.00 4,971,783.44 518,392,276.69
(2) Account receivable that is not a great single amount but accrues bad debit reserve individually
Unit: RMB Yuan
Amount of accrued
Items of account receivable Book balance Accrual ratio Explanation
bad debits reserve
Account receivable of Could not recover if overdue
800,000.00 800,000.00 100.00
engineering
Account receivable of oil sales 146,915.10 146,915.10 100.00 Could not recover if overdue
Total 946,915.10 946,915.10 100.00
- 37 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V). Notes on consolidated financial statements-Continued
3. Accounts Receivable-Continued
(3) Transfer and receipt in this period
Unit: RMB Yuan
Amount of
Reasons for Evidence for
accumulated bad debits Transferred and
Items of account receivable transfer and bad debts
reserve before transfer received amount
receipt reserve
and receipt
Shenzhen Petrochemical Bonded
Unreceived
Trade Co., Ltd (Petrochemical Received 3,474,613.06 48.28
overdue
Bonded Company)
China National Electric Equipment Unreceived
Received 626,043.00 626,043.00
Corporation (CNEEC) overdue
Dongguan Dongcheng Dongxing Unreceived
Received 480,000.00 480,000.00
Thermoelectricity Co., Ltd overdue
Sulige Gas Electricity Generation Unreceived
Received 69,164.00 69,164.00
Co., Ltd overdue
Total 4,649,820.06 1,175,255.28
(4) No account from shareholders with more than 5% (including 5%) voting rights of the Company is
receivable in the account receivable during the reporting period.
(5) The Top Five Organizations in the List of Amount of Account Receivable
Unit: RMB Yuan
Percentage of the total amount of
Name of the Relation with the
Amount Year limit account receivable
organization Company
(%)
Shenzhen Financial Government 60.09
564,250,490.62 Less than 1 year
Bureau sector
Guangdong Power Non-associated 16.50
154,924,810.94 Less than 1 year
Grid Company customer
Zhongshan Government Less than 1year 14.81
139,076,486.80
Financial Bureau sector
Dongguan Financial Government 6.72
63,135,152.56 Less than 1year
Bureau sector
Shenzhen Water Government 0.51
4,799,052.95 Less than 1year
Authority sector
Total 926,185,993.87 98.63
4. Prepaid Accounts
(1)Prepaid Accounts Listed According to the Account Age
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Age of account Percentage Percentage
Amount Amount
(%) (%)
Less than 1 year 31,358,682.53 99.31 12,746,630.59 94.21
From 1 year to 2 years 280.00 - 542,468.58 4.01
From 2s year to 3 years 84,031.98 0.27 21,224.71 0.16
More than 3 years 133,402.72 0.42 219,578.01 1.62
Total 31,576,397.23 100.00 13,529,901.89 100.00
- 38 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V). Notes on consolidated financial statements-Continued
4. Prepaid Accounts-Continued
(2) The Top Five Organizations in the List of Amount of Prepaid Account
Unit: RMB Yuan
Relation with Unsettled
Name of the organization the Company Amount Time reasons
Prepaid
Unrelated Less than 1
Shenzhen Dapeng LNG Marketing Co., Ltd. 16,271,809.11 purchasing
supplier year
expense
Prepaid
Guangdong Trade Company of CNOOC Gas & Unrelated Less than 1
9,438,727.20 purchasing
Power Group Co., Ltd. supplier year
expense
Prepaid
Unrelated Less than 1
Guangdong Guoyu Energy CO., Ltd. 1,576,538.26 purchasing
supplier year
expense
Prepaid
Unrelated Less than 1
Ningbo Lvyuan Natural Gas Electricity Co., Ltd. 1,340,114.64 purchasing
supplier year
expense
Prepaid
Unrelated Less than 1
Xinao Energy Trade CO., Ltd. 1,070,048.83 purchasing
supplier year
expense
Total 29,697,238.04
(3) No prepaid account is from shareholders with more than 5% (including 5%) voting rights of the Company
in the prepaid account balance during the reporting period.
(4) Prepaid accounts Disclosed According to Customers
Unit: RMB Yuan
Amount in the
Amount at the end of beginning of the year
Categories the year
Prepaid account with an individually significant amount 25,710,536.31 4,504,321.11
Prepaid account that does not have an individually
significant amount but has a bigger credit risk after
combination based on characteristics of credit risks 133,402.72 219,578.01
Other relative prepaid amount which does not have an
individually significant amount 5,732,458.20 8,806,002.77
Total 31,576,397.23 13,529,901.89
The Group defines the prepaid account with an amount over RMB 2,000,000.00(including RMB 2,000,000.00)
as an individually significant prepaid amount. Account that is not individually significant, but has a bigger risk
after combination based on credit risk characteristics, is a prepaid account which is not individually significant
but has more than 3 years account age.
5. Other Accounts Receivable
(1)Disclosure of Other Accounts Receivable
- 39 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Book balance Bad debit reserve Book balance
Categories
Percen
Percentage Percent
Amount tage Amount Amount
(%) age (%)
(%)
Account receivable
that is a great single
amount and accrues
26,237,404.46 16.79 26,237,404.46 100.00 26,237,404.46 52.08 26,237,404.46 100.00
bad debit reserve
individually with this
amount
Account receivable
that is not a great
single amount, and
that is a great single
122,108,196.73 78.15 - - 18,742,661.50 37.21 - -
amount but not
depreciated through
individual
depreciation text
Account receivable
that is not a great
single amount but 7,904,555.63 5.06 5,412,909.64 68.48 5,394,398.21 10.71 3,686,910.48 68.35
accrues bad debit
reserve individually
Total 156,250,156.82 100.00 31,650,314.10 20.26 50,374,464.17 100.00 29,924,314.94 59.40
- 40 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V). Notes on consolidated financial statements-Continued
5. Other Accounts Receivable-Continued
The Group defines other account receivable with an amount over RMB 2,000,000.00 (including RMB
2,000,000.00) as individually significant other account receivable.
Analysis of account age of other accounts receivable
Unit: RMB Yuan
Ending amount Amount in the beginning of the year
Percen Percen
Accou tage Bad debits tage Bad debits Book
nt age Amount (%) reserve Book value Amount (%) reserve value
Less than 111,572,972.0 14,174,958.2
71.41 - 111,572,972.06 14,174,958.20 28.14 -
1 year 6 0
From 1
year to 2 11,164,372.30 7.15 10,000.00 11,154,372.30 4,352,781.54 8.64 - 4,352,781.54
years
From 2
years to 3 1,672,519.64 1.07 173,524.12 1,498,995.52 81,091.50 0.16 - 81,091.50
years
More than
31,840,292.82 20.37 31,466,789.98 373,502.84 31,765,632.93 63.06 29,924,314.94 1,841,317.99
3 years
156,250,156.8 20,450,149.2
100.00 31,650,314.10 124,599,842.72 50,374,464.17 100.00 29,924,314.94
Total 2 3
(2) Other account receivable that does not have an individually significant amount but is accrued bad debit
reserve individually
Unit: RMB Yuan
Amount of accrued Accrual
Contents of other account receivable Book balance Reasons
bad debit reserve ratio
Part of the amount
3,278,632.28 1,404,953.09 42.85 could not recover if
Deposit receivable overdue
Part of the amount
2,083,698.16 1,736,004.16 83.31 could not recover if
Receivable dormitory fees overdue
Could not recover if
1,496,448.19 1,496,448.19 100.00
Consignment goods overdue
Others 74.16 Part of the amount
1,045,777.00 775,504.20 could not recover if
overdue
Total 7,904,555.63 5,412,909.64 68.48
(3) Transfer and receipt in this period
Amount of
Contents of other accumulated bad
account Reasons for Evidence for bad debits reserve before Transferred and
receivable transfer and receipt debits reserve transfer and receipt received amount
Legal cost of
Received Unreceived overdue 5,965.00 5,965.00
Peng Juncheng
Loan of Peng
Received Unreceived overdue 4,040.00 4,040.00
Juncheng
Total 10,005.00 10,005.00
(4) No account receivable is from shareholders with more than 5% (including 5%) voting rights of the
Company in reporting period.
(5) The Top Five Organizations in the List of Amount of Account Receivable
- 41 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Unit: RMB Yuan
Percentage of the total
Relation with Age other account receivable
Name of the organization the Company Amount limitation (%)
Jiangxi Electricity Subsidiary of Unrelated
Less than
China Electricity Investment customer 106,342,100.00 68.06
1 year
Group
Project partner
More than
Huiyang Kangtai Industrial Co., 14,311,626.70 9.16
3 years
Ltd. (Note 1)
Shenzhen Dapeng LNG Unrelated 1 to 2
10,032,000.00 6.42
Marketing Co., Ltd. supplier years
Shenzhen Shanshan Investment Note 2 More than
5,895,738.00 3.77
Management Company 3 years
Jinan Power Generation Unrelated More than
3,560,000.00 2.28
Equipment Factory customer 3 years
Total 140,141,464.70 89.69
(V) Notes on consolidated financial statements-Continued
5. Other Account Receivable-Continued
Note 1: is a project development expense which is paid for the Stone Lake Project, Bank of Henan, Huizhou
City co-worked with Huiyang Kangtai Industrial Co., Ltd. In 1993.
Note 2: With response to No.32 document issued by Shenzhen Government in 1994, Notice about adjustment
on the state-owned equity ownership of Nanshan Thermoelectricity Co., Ltd., Nanshan Electronic
Industrial Development Company transfer 23.47% of the shares it holds in the Company to Shenzhen
Nanshan Investment Management Company in 1994. With response to No. 19 document issued by
Shenzhen Nanshan District, Notice about transfer the ownership of the state-owned equity of Nanshan
Thermoelectricity Co., Ltd., Shenzhen Nanshan Investment Management Company transfer the shares
mentioned above back to Nanshan Electronic Industrial Development Company in 1995. The Company
predicts that this amount is unable to receive; therefore it debits the bad debit reserve in total amount.
6. Inventories
(1) Classification of Inventory
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Items Book balance obsolete stocks Book value Book balance obsolete stocks Book value
Fuel 33,903,196.77 9,299,403.20 24,603,793.57 164,666,409.63 3,121,172.54 161,545,237.09
Raw materials 147,714,930.63 23,275,444.95 124,439,485.68 144,530,444.66 17,199,322.49 127,331,122.17
Lands to be developed 1,154,755,949.8
45,603,631.85 1,109,152,318.00 1,109,099,484.65 45,603,631.85 1,063,495,852.80
(Noted ) 5
Total 1,336,374,077.2
78,178,480.00 1,258,195,597.25 1,418,296,338.94 65,924,126.88 1,352,372,212.06
5
There is RMB 252,782,341.45 (December 31, 2010, RMB 229,163,561.16) used to offset against mortgage in
inventory balance at the end of the year. For more details, please refer to note (5) 24.
There is RMB 168,902,319.91 of the borrowing fees capitalized in inventory balance at the end of the year
(December 31, 2010, RMB 124,204,731.24). The capitalized borrowing fees amounts to RMB 44,697,588.67
with the capitalization rate of 6.14%.
Note: is the land cost used to real estate development by Shenzhong Real Estate Development and Shenzhong
Real Estate Company. By December 31, 2011, removement of the attached buildings has not finished.
(2) Inventory Obsolete Stocks
Unit: RMB Yuan
- 42 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Categories of Beginning Accrual amount Depreciation this year
inventory balance this year Transfer Write-off Ending balance
Fuel 3,121,172.54 8,898,716.76 - 2,720,486.10 9,299,403.20
Raw materials 17,199,322.49 6,955,311.81 - 879,189.35 23,275,444.95
Lands to be
45,603,631.85 - - - 45,603,631.85
developed
Total 65,924,126.88 15,854,028.57 - 3,599,675.45 78,178,480.00
(V) Notes on consolidated financial statements-Continued
6. Inventory-Continued
(3) Status quo of inventory Obsolete Stocks
Percentage of transferred
Reasons for transfer the amount in the inventory
Items
Evidence for accrued inventory obsolete stocks balance at the end of the
inventory obsolete stocks this year year (%)
Cost is higher than the
Fuel Not applicable Not applicable
changeable net value
Cost is higher than the
Raw materials Not applicable Not applicable
changeable net value
Lands to be Cost is higher than the
Not applicable Not applicable
developed changeable net value
7. Other Current Assets
Disclosure of Other Current Assets according to the category
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Depreciation Depreciation
Categories Amount reserves Net value Amount reserves Net value
Long term assets
held to be sold - - - 5,875,631.20 1,633,199.83 4,242,431.37
(noted)
Note: Balance at the beginning of the year refers to the residual heat electricity generation equipment,
which is planned to be sold and held by the Shenzhong Development Company.
- 43 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V) Notes on consolidated financial statements-Continued
8. Investment on Long Term Share Ownership
Details of Investment on Long Term Share Ownership:
Unit: RMB Yuan
Explanation for
Percentage of inconsistent between
Shareholding Accrued
Accoun Balance at the voting rights in percentage of share Depreciati
Changes about Balance at the percentage in the depreciatio Cash bonus
Invested organization ting Investment cost beginning of the invested ownership and on
increase (decrease) end of the year invested n reserves this year
method year organization percentage of voting reserves
organization (%) this year
(%) right in the invested
organization
Jiangxi Electricity Subsidiary
of China Electricity Investment Equity
286,285,715.00 227,103,274.30 (227,103,274.30) - 30.00 30.00 Not applicable - - -
Group (Jiangxi Xinchang method
Company) (Note1)
Petrochemical Bonded Cost 2,500,00
2,500,000.00 2,500,000.00 - 2,500,000.00 4.00 4.00 Not applicable - -
Company method 0.00
Shenzhen Energetic and
Cost
Environmental Co., Ltd. (Note 89,671,000.00 41,790,000.00 (41,790,000.00) - 10.00 10.00 Not applicable - - -
method
2)
Jiangxi Nuclear Power
Subsidiary of China
Cost
Electricity Investment Group 37,315,000.00 37,315,000.00 - 37,315,000.00 5.00 5.00 Not applicable - - -
method
(Jiangxi Nuclear Power
Company)
2,500,00
Total 415,771,715.00 308,708,274.30 (268,893,274.30) 39,815,000.00 - -
0.00
Decrease：Depreciation
2,500,000.00 - 2,500,000.00
reserves
Net amount of long-term share
306,208,274.30 37,315,000.00
ownership investment
Note 1: On December 1, 2011, with permission by the 3rd temporary meeting, 6th Board of Directors, the Company signed the share ownership transfer contract with Jiangxi Electricity Subsidiary of
China Electricity Investment Company (China Electricity Investment Jiangxi Company).
30% of the shares of Jiangxi Xinchang Company held by the Company are agreed to transfer at the price of RMB 217,024,700.00. By December 29, 2011, the Company has received the
transfer amount of RMB 110,682,600.00. On December 31, 2011, Jiangxi Xinchang Company has completed procedure about registration of industry and commerce, which is related to this
share ownership transfer. With references to the professional law opinions from lawyers, executives of the Company consider that by December 31, 2011, the Company has been unable to
obtain profits and undertake risk from the share ownership.
Note 2: On January 31, 2011, the Company pays RMB 47,881,000.00 for investment in the Energy and Environment Company according to Motion to increase the registered capital investment in
Energy and Environment CO., Ltd. On October 14, 2011, with permission of the 5th meeting in the 6th Board of Directors, the Company signed the transfer contract of share ownership with
Energy Group, and agreed to transfer the 10% shares it holds in Energy and Environment Company at a price of RMB 123,078,900.00. The Company has received the transferred amount on
December 13, 2011. On December 31, 2011, the Energy and Environment Company has completed related industrial and commercial change registration, which is associated with the
transfer of share ownership. Based on professional lawyers’ opinions, executives of the Company consider that by December 31, 2011, the Company has been unable to obtain profits and
undertake risks from the share ownership.
- 44 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V) Notes on consolidated financial statements-Continued
9. Invested Real Estate
Note: Accrued depreciation of current year is RMB 436,724.91
Unit: RMB Yuan
Beginning
Items Increase this year Decrease this year Ending book value
book value
I. Original book value in total 9,708,014.96 - - 9,708,014.96
1. Houses and buildings 9,708,014.96 - - 9,708,014.96
2. Using right of lands - - - -
II. Accumulated depreciation and 436,724.91(Note 4,835,969.89
accumulated amortization in total 4,399,244.98 ) -
1.Houses and buildings 4,399,244.98 436,724.91 - 4,835,969.89
2. Using right of lands - - - -
III. Book net value on invested real estate
in total 5,308,769.98 4,872,045.07
1. Houses and buildings 5,308,769.98 4,872,045.07
2. Using right of lands - -
IV. Depreciation reserves on invested real - -
estate in total - -
1. Houses and buildings - - - -
2. Using right of lands - - - -
V. Book value on invested real estate in
total 5,308,769.98 4,872,045.07
1. Houses and buildings 5,308,769.98 4,872,045.07
2. Using right of lands - -
Note: the depreciated amount adds up to RMB 436,724.91 this year.
- 45 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V) Notes on consolidated financial statements-Continued
10. Fixed Assets
(1) Changes on Fixed Assets
Unit: RMB Yuan
Items Beginning book value Increase this year Decrease this year Ending book value
I. Original book value in total 4,220,935,520.11 279,912,578.82(注 1) 40,226,451.02(注 2) 4,460,621,647.91
Including: houses and buildings 447,729,795.72 50,895,000.19 14,210,577.61 484,414,218.30
Machinery equipment 3,675,038,036.84 227,952,304.60 7,421,823.93 3,895,568,517.51
Transportation instruments 33,968,349.80 400,166.82 2,131,482.00 32,237,034.62
Other equipments 64,199,337.75 665,107.21 16,462,567.48 48,401,877.48
II. Accumulated appreciation in Accrued amount of
total 2,018,728,112.00 current year (Note 3)
32,185,281.68(Note 4) 2,196,925,392.65
Including: houses and buildings 185,153,139.13 19,135,523.55 9,457,565.88 194,831,096.80
Machinery equipment 1,754,084,729.67 187,944,084.77 5,836,758.62 1,936,192,055.82
Transportation instruments 27,898,786.75 1,337,166.96 2,080,980.49 27,154,973.22
Other equipments 51,591,456.45 1,965,787.05 14,809,976.69 38,747,266.81
III. Book net value on fixed assets
in total 2,202,207,408.11 2,263,696,255.26
Including: houses and buildings 262,576,656.59 289,583,121.50
Machinery equipment 1,920,953,307.17 1,959,376,461.69
Transportation instruments 6,069,563.05 5,082,061.40
Other equipments 12,607,881.30 9,654,610.67
IV. Depreciation reserves in total 32,981,137.38 6,265,762.65 2,654,224.03 36,592,676.00
Including: houses and buildings 25,686,723.89 - 2,394,879.52 23,291,844.37
Machinery equipment 7,030,159.76 6,265,762.65 218,186.79 13,077,735.62
Transportation instruments 85,146.84 - 3,300.00 81,846.84
Other equipments 179,106.89 - 37,857.72 141,249.17
V. Book value on fixed assets in
total 2,169,226,270.73 2,227,103,579.26
Including: houses and buildings 236,889,932.70 266,291,277.13
Machinery equipment 1,913,923,147.41 1,946,298,726.07
Transportation instruments 5,984,416.21 5,000,214.56
Other equipments 12,428,774.41 9,513,361.50
Note 1: RMB 2,680,222.14 for purchase and RMB 277,232,356.68 for engineering establishment are added.
Note 2: RMB 40, 226,451.02 is decreased for purchase.
Note 3: RMB 210,382,562.33 is depreciated this year.
Note 4: RMB 32,185,281.68 is decreased for purchase.
- 46 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V) Notes on consolidated financial statements-Continued
10. Fixed Assets-Continued
(2) Information about Lay over Fixed Assets
Unit: RMB Yuan
Items Original Book Accumulated Depreciation Book value Notes
value depreciation reserves
Balance at the
466,268,043.17 405,890,620.56 8,329,271.25 52,048,151.36
beginning of the year
Including: houses and
2,489,600.00 94,720.48 2,394,879.52 -
buildings
Machinery equipment 463,752,743.17 405,792,912.04 5,932,755.20 52,027,075.93 Generator set
Transportation
3,200.00 - 200.00 3,000.00
instruments
Other equipments 22,500.00 2,988.04 1,436.53 18,075.43
Balance at the end of
577,639,507.90 483,610,796.33 11,886,196.41 82,142,515.16
the year
Including: houses and Wharf
23,302,622.41 7,290,364.80 - 16,012,257.61
buildings
Machinery equipment Heavy oil processing line
553,917,537.49 475,943,018.33 11,886,196.41 66,088,322.75
and generating units
Transportation
- - - -
instruments
Other equipments 419,348.00 377,413.20 - 41,934.80
(3) Fixed Assets with uncompleted Certificate of Title
Unit: RMB Yuan
Reasons for incomplete Expected time for Transaction of
Items Original book value Book value Certificate of Title Certificate of Title
Booster stations 11,416,072.09 7,866,297.56
Turbine building 4,221,136.27 2,977,230.28
Water treatment building 7,050,395.16 4,935,155.86
Heavy oil processing plant 1,357,924.60 959,730.53
Fire pump house 709,475.99 501,134.97
Circulating water pump house 4,487,508.99 3,157,744.70
Comprehensive building 9,826,335.09 7,178,729.47
Production maintenance
building 9,860,653.25 7,993,537.65
Administrative building 10,138,618.59 8,218,689.49
Security room 248,140.56 236,825.40
Master control room Inspection of the complete
387,221.96 369,564.68 project is still executed
By the end of 2012
Turbine and auxiliary buildings 24,770,257.87 18,087,262.09
The plant ventilation system 1,287,247.17 939,947.83
Office building 11,621,767.07 8,819,839.20
Highly ventilated cooling
tower 7,958,561.88 5,811,341.54
Water treatment workshop and
tank foundation 3,782,455.60 2,761,949.17
Industrial water pool and
industrial water pump house 1,660,047.34 1,212,166.56
Start up boiler house 277,381.12 202,543.57
Oil processing chamber, oil
unloading platform
3,375,389.79 2,464,709.71
Total 114,436,590.39 84,694,400.26
- 47 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
11. Under-construction project
(1) ：Details of under-construction project are as below:
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Depreciation Depreciation
Item Book balance reserves Net book value Book balance reserves Net book value
Oil to gas engineering 39,549,115.52 14,790,696.15 24,758,419.37 41,087,274.71 14,790,696.15 26,296,578.56
Circular economy complex building project - - - 13,255,379.33 - 13,255,379.33
Circular economy cold heat and power project 9,622,579.25 - 9,622,579.25 7,160,526.05 - 7,160,526.05
Equipment transformation engineering 545,548.53 - 545,548.53 9,684,185.63 - 9,684,185.63
Cogeneration project 9,894,925.01 - 9,894,925.01 8,882,713.73 - 8,882,713.73
Technology transformation engineering - - - 2,505,000.00 - 2,505,000.00
Sludge desiccation project
- - - 126,728,860.05 - 126,728,860.05
Others
2,271,897.32 226,400.00 2,045,497.32 2,216,233.29 - 2,216,233.29
Total 61,884,065.63 15,017,096.15 46,866,969.48 211,520,172.79 14,790,696.15 196,729,476.64
- 48 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
11. Under-construction -continued
(2) Change of important under-construction project
Unit: RMB Yuan
This
Project
Interest Among: this year’s
Amount in the investment
Increase in this Transferred Other Project capitalized year’s interest interest Capital Amount at the
Item name Budget beginning of proportion
year fixed assets decrease progress accumulative capitalized capitaliz source end of the year
the year of
total amount amount ed
budget(%)
rate(%)
Oil to gas engineering 74,400,000.00 41,087,274.71 3,833,970.31 5,354,806.40 17,323.10 60.38 60.38 - - - 自筹 39,549,115.52
Circular economy complex
35,000,000.00 13,255,379.33 14,192,758.35 27,448,137.68 - 78.42 100.00 - - - 自筹 -
building project
Circular economy cold heat
30,000,000.00 7,160,526.05 2,462,053.20 - - 32.08 32.08 - - - 自筹 9,622,579.25
and power project
Equipment transformation
9,684,185.63 2,720,338.33 11,858,975.43 - - - - 自筹 545,548.53
engineering
Cogeneration project 8,882,713.73 2,468,583.44 1,338,680.00 117,692.16 676,760.53 - - 自筹及借款 9,894,925.01
Technology transformation
2,505,000.00 1,662,555.06 4,167,555.06 - - - - 自筹 -
engineering
Sludge desiccation project 190,535,670.40 126,728,860.05 25,956,138.15 152,050,904.13 634,094.07 80.13 100.00 - - - 自筹 -
DLN low nitrogen
90,800,000.00 - 75,013,297.98 75,013,297.98 - 82.61 100.00 - - - 自筹 -
transformation project
Others 2,216,233.29 2,809,539.32 - 2,753,875.29 - - - 自筹 2,271,897.32
Total 211,520,172.79 131,119,234.14 277,232,356.68 3,522,984.62 676,760.53 - 61,884,065.63
(3)Depreciation reserves for under-construction project
Unit: RMB Yuan
Item Amount in the beginning Increase in this year Decrease in this year Amount at the end of the Provision reasons
of the year year
Oil to gas engineering 14,790,696.15 - - 14,790,696.15 Note
Quay transformation project - 226,400.00 - 226,400.00
Total 14,790,696.15 226,400.00 - 15,017,096.15
Note: Approved by the twenty-sixth meeting of the fifth session of the Board of Directors, the company has closed down cycle unit 7 and 9, and according to independent
professional assessment organization’s assessment result of their fair value, the oil to gas project provision for depreciation preparation of cycle unit 7 and 9 is RMB
14,790,696.15.
- 49 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
12. Intangible assets
Unit: RMB Yuan
Beginning book Decrease in this Ending book
Item Increase in this year
balance year balance
I. Total book original value 95,836,143.29 2,871,851.92(note 1) - 98,707,995.21
Among: land-use right 95,600,235.88 131,812.00 - 95,732,047.88
Software 235,907.41 2,740,039.92 - 2,975,947.33
II. Cumulative total amortize 26,484,148.07 3,301,244.81(note 2) - 29,785,392.88
Among: land-use right 26,274,255.40 2,950,998.04 - 29,225,253.44
Software 209,892.67 350,246.77 - 560,139.44
III. Intangible assets total net book 68,922,602.33
69,351,995.22
value
Among: land-use right 69,325,980.48 66,506,794.44
Software 26,014.74 2,415,807.89
IV. Total depreciation reserves 5,115,063.71 - - 5,115,063.71
Among: land-use right 5,115,063.71 - - 5,115,063.71
Software - - - -
V. Intangible assets total book value 64,236,931.51 63,807,538.62
Among: land-use right(note 3) 64,210,916.77 61,391,730.73
Software 26,014.74 2,415,807.89
Note1: Increase total RMB 131,811.66 for acquisition this year, and total RMB 2,740,040.26 for the
transformation of under-construction projects.
Note 2: This years’ intangible assets amortize is RMB 3,301,244.81.
Note 3: Until December 31, 2011, the company’s property right of land use certificate is still in the process,
book value of which is RMB 589,611.99 (December 31, 2010: RMB 693,506.00).
- 50 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
13. Long-term prepaid expenses
Unit: RMB Yuan
Amount in
Increased Amortized Other Amount at
the Other reasons
Item amount of amount of decreased the end of
beginning of for decrease
this year current year amount the year
the year
Improved expenditure of
273,212.64 - 177,401.80 - 95,810.84 Not Applicable
operating lease fixed assets
14. Deferred income tax assets
(1) The confirmed deferred income tax assets
Unit: RMB Yuan
Amount at the end of Amount in the
Item
the year beginning of the year
Deferred income tax assets：
Bad debt preparation for account receivable 1,105,382.04 983,843.73
Bad debt preparation for other account receivable 1,010,200.86 1,012,702.11
Inventory falling price reserves 100,171.61 749,081.41
Employee payment payable 627,581.00 1,014,310.56
Preparation for long-term equity investments
625,000.00 625,000.00
impairment
Others 245,778.80 239,467.33
Total 3,714,114.31 4,624,405.14
(2) The deductible temporary difference and deductible loss of unconfirmed deferred income tax asset
Unit: RMB Yuan
Amount at the end of Amount in the
Item
the year beginning of the year
The deductible loss 484,508,965.20 560,035,409.20
Deductible temporary differences 192,293,490.13 168,277,128.89
Total 676,802,455.34 728,312,538.09
Because of the uncertainty of this group’s future ability to obtain sufficient taxable income, the above
deductible temporary difference and deductible loss are not confirmed as deferred income tax assets.
(3) The deductible loss of unconfirmed deferred income tax assets will expire next year.
Unit: RMB Yuan
Amount at the end of the Amount in the
Year
year beginning of the year
2011 - 77,662,096.83
2012 37,464,387.00 37,464,387.00
2013 67,627,487.41 67,627,487.41
2014 124,132,588.65 206,233,081.29
2015 171,048,356.67 171,048,356.67
2016 84,236,145.47 -
Total 484,508,965.20 560,035,409.20
- 51 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
14. Deferred income tax assets- continued
(4) The details of deductible temporary difference project
Unit: RMB Yuan
Item Temporary difference amount
Ending balance:
Deductible temporary difference project:
Bad debt preparation for account receivable 4,421,528.16
Bad debt preparation for other account receivable 4,040,803.43
Inventory falling price reserves 400,686.44
Employee payment payable 2,510,324.00
Preparation for long-term equity investments impairment 2,500,000.00
Others 983,115.22
Total 14,856,457.25
Beginning balance:
Deductible temporary difference project:
Bad debt preparation for account receivable 4,971,783.44
Bad debt preparation for other account receivable 4,050,808.43
Inventory falling price reserves 3,121,172.54
Employee payment payable 4,226,294.00
Preparation for long-term equity investments impairment 2,500,000.00
Others 997,780.57
Total 19,867,838.98
15. Other noncurrent assets
Unit: RMB Yuan
Amount in the beginning of
Item Amount at the end of the year the year
LNG Liquefied natural gas project(note) 22,298,256.78 21,273,223.68
Prepaid land amount 1,730,000.00 -
Prepaid project amount 836,460.20 -
Total 24,864,716.98 21,273,223.68
Note: This project is built by Weimei Electric Power Company and Guangdong, Dapeng Liquefied Natural Gas
(LNG) Co., Ltd. ( here after referred to as Dapeng Natural Gas Company). According to the contract
signed by both parties, before the involved projects obtaining the approval from the related national
authorities, both parties have its ownership. After related projects are approved by related national
authorities, Dapeng Natural Gas Company will purchase LNG liquefied natural gas project, so Weimei
Electric Power will be accounted as its noncurrent assets.
- 52 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
16. Details of assets depreciation preparation
Unit: RMB Yuan
Book balance in Decrease in this year Book balance at
the beginning of Current year Turn back Write off the end of the
Item the year decrease year
I. Bad debt preparation 34,896,098.38 2,361,004.16 1,185,260.28 - 36,071,842.26
II. Inventory falling price
65,924,126.88 15,854,028.57 - 3,599,675.45 78,178,480.00
preparation
III. Preparation for long-term
equity investments 2,500,000.00 - - - 2,500,000.00
impairment
IV. Fixed assets impairment
32,981,137.38 6,265,762.65 - 2,654,224.03 36,592,676.00
preparation
V. Impairment preparation for
14,790,696.15 226,400.00 - - 15,017,096.15
under-construction project
VI. Intangible assets
5,115,063.71 - - - 5,115,063.71
impairment preparation
VII. Other impairment
1,633,199.83 - - 1,633,199.83 -
preparation
Total 157,840,322.33 24,707,195.38 1,185,260.28 7,887,099.31 173,475,158.12
17. Short-term loan
Unit: RMB Yuan
Item Amount at the end of the Amount in the beginning
year of the year
Guaranteed loan (note)
1,110,000,000.00 700,000,000.00
Credit loan 2,155,824,953.89 2,412,400,000.00
Total 3,265,824,953.89 3,112,400,000.00
Note: the company provides RMB 1,110,000,000.00 guaranteed loan for each subsidiary.
18. Notes payable
Unit: RMB Yuan
Category Amount at the end of the Amount in the beginning
year of the year
Bank acceptance bill 43,820,200.00 -
The amount will expires in the next accounting period is RMB 43,820,200.00.
- 53 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
19. Account payable
(1) The details of account payable are as below:
Unit: RMB Yuan
Item Amount in the
Amount at the end
beginning of the
of the year
year
Nakaumi Petroleum Gas and Electric Group Co., Ltd,,
181,779,179.15 41,806,080.04
Guangdong Trade Branch
Shenyang Eric Electric Design College 7,315,553.15 -
Zhanjiang City Hengyuan Transportation Co. LTD 5,646,006.85 1,502,327.83
Shenzhen Nangang power engineering Co. Ltd 3,779,052.00 9,160,098.52
Guangzhou Dongli fuel gas Co. Ltd 3,125,154.90 -
Shenzhen Xixun transportation industry Co. Ltd 2,559,469.44 -
Fuxun Chinese Oil and Energy Equipment Factory 1,253,000.00 -
The new Austrian energy logistics Co., Ltd 1,041,630.24 -
Xingjiang Guanghui Liquefied natural gas (LNG) Co., Ltd,
1,000,000.00 -
Shanshan transportation Branch
Wuxi Shijia Heat Energy Equipment Co., Ltd 662,469.80 1,362,469.80
Huasheng Filter (Shenzhen) Co., Ltd 608,369.23 680,680.33
Others 5,979,004.90 6,603,782.09
Total 214,748,889.66 61,115,438.61
(2) Account payable balance in this reporting period has no payable for shareholders with 5% or more voting
shares of this company.
(3) Large accounts payable aged over one year should have account payable description.
The amount
Account
Reasons for failing to repaid in the
Supply name Amount receivable
pay future in the
age balance sheet
Shenzhen Nangang power One to The other party does -
3,779,052.00
engineering Co. Ltd two years not collect
Wuxi Shijia Heat Energy One to The other party does -
662,469.80
Equipment Co., Ltd two years not collect
Huasheng Filter (Shenzhen) One to The other party does -
538,800.00
Co., Ltd two years not collect
Total 4,980,321.80 -
20. Advanced receipts
(1) Details of advanced receipts are below:
Unit: RMB Yuan
Item Amount at the end Amount in the
of the year beginning of the
year
Advanced unit capacity transfer amount 14,586,000.00 14,586,000.00
Advanced project amount - 24,210,498.66
Advanced fuel gas amount - 477,842.60
Total 14,586,000.00 39,274,341.26
(2) The advanced receipts balance in this reporting period has no advanced receipts from shareholders with 5%
- 54 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
or more voting shares of this company.
(3) The advanced receipts balance of Shenzhen Energy Group Co., Ltd (Energy Shares) is RMB 14,586,000.00
Yuan. The account receivable age is over 1 year. Because related projects have not been approved by
National Development and Reform Committee and advanced receipts have not achieved sales, the end of the
year has been carried forward income. Until the approval date of financial statements are, the above amounts are
not carried forward income.
(V)Notes on consolidated financial statements- continued
21. Employee payment payable
Unit: RMB Yuan
Item Book balance in Increase in this Decrease in this Book balance at
the beginning of year year the end of the year
the year
I. Wages, bonuses, allowances and
35,136,058.44 90,137,445.70 98,297,459.17 26,976,044.97
subsidies
II. Employee benefits - - - -
III. Social insurance premiums 795,465.82 9,147,930.52 9,077,961.36 865,434.98
Among: Medical insurance premiums 126,913.93 4,763,435.54 4,775,779.62 114,569.85
Old-age insurance 570,135.63 3,950,291.70 3,871,209.32 649,218.01
Unemployment insurance 36,930.79 172,638.23 170,947.74 38,621.28
Industrial injury insurance
59,996.94 241,024.92 239,454.68 61,567.18
premium
Birth insurance premium 1,488.53 20,540.13 20,570.00 1,458.66
IV. Housing fund 1,828,835.46 7,611,961.70 8,810,973.17 629,823.99
V. Union funds and employee education
1,715,337.35 1,910,950.26 1,932,666.89 1,693,620.72
expenses
VI. Non-monetary benefits - 261,638.42 261,638.42 -
VII. Compensation for the cancellation
- - - -
of the labor relations
VIII. Enterprise annuity 5,926,920.26 463,630.48 3,880,226.74 2,510,324.00
Others 30,333.37 79,546.28 93,454.27 16,425.38
Total 45,432,950.70 109,613,103.36 122,354,380.02 32,691,674.04
There is no delayed amount in employee payment payable.
22. Tax payable
Unit: RMB Yuan
Item Amount at the end of the year Amount in the beginning
of the year
Value-added tax (529,083,686.53) (516,271,620.82)
Business tax 2,835,558.63 2,038,956.43
Business income tax (2,823,965.65) 8,069,776.38
Individual income tax 3,411,627.24 1,646,774.92
City and town land use tax 1,128,579.70 1,137,583.80
Building taxes 2,084,520.46 1,770,165.58
Others 546,572.25 414,945.62
Total
(521,900,793.90) (501,193,418.09)
23. Interest payable
Unit: RMB Yuan
Amount at the end of the Amount in the beginning of
Item
year the year
Staging payment of interests due and principle repayments of
45,825.00 204,536.00
long-term loan interests
Short-term loan interests payable 75,416,769.51 59,143,503.27
Total 75,462,594.51 59,348,039.27
- 55 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
24. Other amount payable
(1) The details of other amount payable are below:
Unit: RMB Yuan
Item Amount at the end of Amount in the
the year beginning of the year
Zhongshan Xingzhong Group Co., Ltd (Xingzhong
182,152,108.65 182,152,108.65
Group) (note 1)
Dongguang Weimei Ceramic Industry park Co., Ltd
36,385,912.01 -
(Weimei Ceramic company)
Shengzhen Nangang Power Engineering Co., Ltd 32,426,503.00 6,417,095.00
Zhongshan city bureau of finance (note 2) 24,321,200.00 24,321,200.00
Project fund 17,267,313.76 15,750,790.11
Temporary income options contracts fund(note 3) 13,248,696.81 13,905,656.99
Xindi Energy Engineering Technology Co., Ltd Fuel gas
11,411,059.79 12,967,790.11
and Technology Branch
Guarantee Money 10,554,569.41 7,384,578.88
Shenzhen North Engineering Co., Ltd 5,771,332.22 -
Nanjing Nangang power Equipment Installation Co., Ltd 3,412,800.00 2,719,200.00
The board of directors allowance 1,947,795.34 2,928,060.85
China Petroleum Chemical Construction Co., Ltd 1,688,000.00 -
The Nakaumi petroleum gas and electric group Co.,
1,420,854.92 -
Ltd, Guangdong Trade Branch
Guangdong Province Industry Equipment Installation
1,416,349.41 -
Company
Shenzhen Hengfulin Building Decoration and Design
1,402,704.46 -
Engineering Co., Ltd
Hangzhuo Boiler Factory Engineering Material Co., Ltd 1,340,189.74 2,486,189.74
Wuxi Shijia Heat Energy Equipment Co., Ltd 1,088,000.00 1,088,000.00
Shenzhen Customs - 2,200,000.00
Others 11,341,990.48 14,447,977.01
Total 358,597,380.00 288,768,647.34
Note 1: Shenzhong Developing Company’s borrowing from Xingzhong Group with its land-use rights and fixed
assets as collateral
Note 2: Shenzhong Developing Company’s borrowing from Zhongshan Municipal Bureau of Finance.
Note 3: Details refer to annotation (VII) or related contingency.
(2) Other amounts payable balance in this reporting period has on fund from shareholders with 5% or more
voting shares of this company.
(3) Other accounts payable with account duration over one year is RMB 256,961,536.35 (December 31, 2010,
RMB 241,111,842.78), mainly is Shenzhong Developing Company’s borrowing from Zhongshan city’s Bureau
of Finance.
- 56 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
25. Noncurrent liabilities due within one year
(1) Details of noncurrent liabilities due within one year are below
Unit: RMB Yuan
Item Amount at the end Amount in the
of the year beginning of the
year
Long-term loan due within one year 50,000,000.00 50,000,000.00
(2) Long-term loan due within one year
Unit: RMB Yuan
Item Amount at the end Amount in the
of the year beginning of the
year
Guaranteed loans(note) 50,000,000.00 50,000,000.00
Note: the company provides guarantee for Zhongshan Electric Power Company borrowing for RMB
50,000,000.00
(3) Long-term loans among the top five due within one year
Unit: RMB Yuan
Amount at the end of the year
Loan Interest Foreign Domestic
Loan units
starting Loan rate currency currency
date ending date Currency (%) amount amount
Huaxia Bank Co., Ltd. Shenzhen
2010.4.1 2012.4.1 RMB 6.65 50,000,000.00
Branch
26. Long-term loan
(1) Long-term loan classification
Unit: RMB Yuan
Item Amount at the end Amount in the
of the year beginning of the
year
Guaranteed loans(note) 26,000,000.00 186,000,000.00
The annual interest rate for the above loans is 6.35%( the year of 2010：from 4.86% to5.94%)
Note: the company provides guarantee for Environmental Company borrowing for RMB 26,000,000.00.
(2) Long-term loan among the top five
Unit: RMB Yuan
Amount in the beginning
Amount at the end of the year
of the year
Forei
Loan Loan ending Interest gn
Loan unit Currency Foreign
starting date date rate(%) Domestic curre Domestic
currency
currency amount ncy currency amount
amount
amou
nt
China Merchants
Bank Co., LTD
2009.11.06 2017.09.20 RMB 6.35 - 26,000,000.00 - 36,000,000.00
Shenzhen Jingtian
Branch
- 57 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
27. Other noncurrent liabilities
Unit: RMB Yuan
Book balance at the end of Book balance in the
Item the year beginning of the year
National debt subsidies for sludge desiccation project 4,866,250.00 5,100,000.00
Circular economy support funds for sludge desiccation project 238,541.66 250,000.00
Total 5,104,791.66 5,350,000.00
28. Capital stock
Unit: RMB Yuan
Change in this year
Beginning Stock Amount at the end of
Item balance distribution Others Subtotal the year
2011:
I. Shares with limited conditions
1. State shareholdings - - - - -
2. State-owned legal person
- - - - -
shares
3. Other domestic capital
12,993.00 - 5,270.00 5,270.00 18,263.00
holdings
4. Foreign Shareholding - - - - -
Total share with limited
12,993.00 - 5,270.00 5,270.00 18,263.00
conditions
II. Shares without limited
condition
1. RMB common stock 338,895,157.00 - (1,145.00) (1,145.00) 338,894,012.00
2. Domestically listed foreign
263,854,446.00 - (4,125.00) (4,125.00) 263,850,321.00
stock
3. Overseas listed foreign stock - - - - -
4. Others - - - - -
Total share without limited
602,749,603.00 - (5,270.00) (5,270.00) 602,744,333.00
condition
III. The sum of shares 602,762,596.00 - - - 602,762,596.00
2010:
I. Shares with limited conditions
1. State shareholdings - - - - -
2. State-owned legal person
- - - - -
shares
3. Other domestic capital
12,993.00 - - - 12,993.00
holdings
4. Foreign Shareholding - - - - -
Total share with limited
12,993.00 - - - 12,993.00
conditions
II. Shares without limited
conditions
1. RMB common stock 338,895,157.00 - - - 338,895,157.00
2. Domestically listed foreign
263,854,446.00 - - - 263,854,446.00
stock
3. Overseas listed foreign stock - - - - -
4. Others - - - - -
Total share without limited
602,749,603.00 - - - 602,749,603.00
conditions
III. The sum of shares 602,762,596.00 - - - 602,762,596.00
- 58 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
29. Capital surplus
Unit: RMB Yuan
Item Amount in the Increase in this Decrease in this Amount in the
beginning of the year year end of the year
year
2011:
Capital premium 233,998,444.00 - - 233,998,444.00
Among: capital invested by investors 215,487,650.42 - - 215,487,650.42
The balance due to acquisition of - -
18,510,793.58 18,510,793.58
minority stockholder’s interest
Other capital surplus 129,631,483.51 - - 129,631,483.51
Among: the original system transfer from the - -
129,631,483.51 129,631,483.51
capital reserve
Total 363,629,927.51 - - 363,629,927.51
2011:
Capital premium 233,998,444.00 - - 233,998,444.00
Among: capital invested by investors 215,487,650.42 - - 215,487,650.42
The balance due to acquisition of
18,510,793.58 - - 18,510,793.58
minority stockholder’s interest
Other capital surplus 129,631,483.51 - - 129,631,483.51
Among: the original system transfer from the
129,631,483.51 - - 129,631,483.51
capital reserve
Total 363,629,927.51 - - 363,629,927.51
30. Features Surplus
Unit: RMB Yuan
Item Amount in the Increase in this Decrease in this Amount in the end
beginning of the year year of the year
year
2011:
Legal features surplus 310,158,957.87 - - 310,158,957.87
Free features surplus 22,749,439.73 - - 22,749,439.73
Total 332,908,397.60 - - 332,908,397.60
2010:
Legal features surplus 310,158,957.87 - - 310,158,957.87
Free features surplus 22,749,439.73 - - 22,749,439.73
Total 332,908,397.60 - - 332,908,397.60
- 59 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
31. Undistributed profits
Unit: RMB Yuan
Item Amount Withdraw or distribution
proportion
2011:
Year-beginning undistributed profits 436,541,567.35
Add: this year’s net profit which belongs to parent company
17,529,063.37
shareholders
) Less: withdraw of legal accumulated surplus(annotation 1) -
Common stock interest payable -
Year-end undistributed profits(annotation 2) 454,070,630.72
2010:
Year-beginning undistributed profits 551,180,245.55
Add: this year’s net profit which belongs to parent company
(114,638,678.20)
shareholders
Less: withdraw of legal accumulated surplus(annotation 1) -
Common stock interest payable -
Year-end undistributed profits(annotation 2) 436,541,567.35
Note 1: According to the articles of incorporation, legal features surplus withdrawal amount is 10% of the parent
company’s net profits. The company’s legal features surplus accumulative amount accounts for 50% or
more of the company’s registered capital, and it does not need to withdraw.
Note 2: December 31, 2011, the group’s undistributed profits balance, including already extracted features
surplus by subsidiary is RMB130,533,578.01( December31, 2010, RMB129,360,135.71)
Note 3: The seventh meeting of the sixth session of the Board of Directors of the company approved that the
company does not distribute profits and conduct capital reserve to capital in 2011
32. Business income, business cost
(1) Business income
Unit: RMB Yuan
Item This year’s Last year’s occurrence
occurrence amount amount
Main business income 2,294,084,960.04 1,598,409,186.21
Other business income 121,732,770.31 3,321,279.09
Business cost 3,589,704,382.71 2,239,345,909.35
- 60 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
32. Business income, business cost-continued
(2) Main business (industry)
Unit: RMB Yuan
This year’s occurrence amount Last year’s occurrence amount
Industry name Business income Business cost Business income Business cost
Energy industry 2,213,598,887.61 3,415,425,758.86 1,573,346,745.72 2,227,284,398.08
Engineering services 27,271,138.96 15,060,357.05 24,168,960.49 10,292,026.88
Other income 53,214,933.47 37,681,376.60 893,480.00 -
Total 2,294,084,960.04 3,468,167,492.51 1,598,409,186.21 2,237,576,424.96
(3) Main business (product)
Unit: RMB Yuan
This year’s occurrence amount Last year’s occurrence amount
Product name Business income Business cost Business income Business cost
Sale of electric power 2,176,654,712.30 3,377,082,661.21 1,560,159,384.89 2,210,206,019.75
Sale of heat power 8,338,395.95 13,251,499.50 10,943,567.41 14,880,927.70
Sale of fuel oil 28,605,779.36 25,091,598.15 2,243,793.42 2,197,450.63
Engineering services 27,271,138.96 15,060,357.05 24,168,960.49 10,292,026.88
Sludge desiccation 27,929,280.47 14,917,789.76 - -
Sale of equipment 25,285,653.00 22,763,586.84 - -
Other income - - 893,480.00 -
Total 2,294,084,960.04 3,468,167,492.51 1,598,409,186.21 2,237,576,424.96
(4) Main business (region)
Unit: RMB Yuan
This year’s occurrence amount Last year’s occurrence amount
Region name Business income Business cost Business income Business cost
Domestic 2,265,634,158.00 3,444,875,457.59 1,591,909,186.21 2,234,953,049.75
Foreign 28,450,802.04 23,292,034.92 6,500,000.00 2,623,375.21
Total 2,294,084,960.04 3,468,167,492.51 1,598,409,186.21 2,237,576,424.96
(5) The business income of the group’s top five customers
Unit: RMB Yuan
Customer name Business income Proportion of all business
income
Guangdong Province Electric Power
2,176,379,260.21 90.09
Company
Guangzhuo Yongmao Trade Co., Ltd. 70,617,503.44 2.92
Shenzhen Xiyang Petroleum and Chemical
41,275,312.26 1.71
Co., Ltd.
Shenzhen Water Authorities 27,929,280.47 1.16
Sandler Expert Limited 25,285,653.00 1.05
Total 2,341,487,009.38 96.93
- 61 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V)Notes on consolidated financial statements- continued
33. Business taxes and surcharges
Unit: RMB Yuan
This year’s Last year’s
occurrence amount occurrence
Item amount Planned standard
Amount to 3% or 5% of the tax
6,358,100.85 6,047,498.46
Business taxes income
Taxes for city
maintenance and 3,544,640.66 1,183,686.70
construction 1%、5% or7% of the taxed circulation tax
Others 2,672,247.40 131,957.38
Total 12,574,988.91 7,363,142.54
34. Management fees
Unit: RMB Yuan
This year’s occurrence amount Last year’s occurrence
Item
amount
Wage 38,034,516.12 34,589,977.46
Tax 7,299,465.03 7,612,290.47
Leasing fee 6,978,347.03 6,635,278.50
Entertainment expenses 5,258,373.43 5,238,625.72
Board of directors' expenses 4,624,007.48 3,202,198.76
Transport costs 4,095,752.61 3,837,816.94
intermediary agency fee 3,171,158.21 4,275,658.85
Amortization of intangible assets 2,594,554.53 2,202,783.34
Depreciate fee 2,247,307.79 2,436,676.40
Environmental protection costs 1,859,562.54 1,831,180.96
Welfare and food fee 1,733,040.18 1,606,501.90
Property management fee 1,653,733.44 1,425,781.46
Housing fund 1,546,088.90 2,924,475.00
Administrative expenses 1,472,322.66 1,156,724.97
Corporate culture fee 1,296,443.47 1,578,280.85
Old-age insurance 1,229,857.24 1,057,475.80
Warrant charges 1,006,927.40 849,235.80
Travelling expense 959,815.57 867,725.05
Communication expense 913,552.17 914,866.59
Medical insurance 675,601.30 705,904.97
Enterprise annuity 206,040.48 1,901,300.02
Amortization of long-term prepaid expenses 157,950.10 211,800.96
Project checking fee 130,397.00 2,079,368.48
Inventory profit (4,871,794.87) (2,752,528.13)
Others 13,265,865.83 9,537,027.08
Total 97,538,885.64 95,926,428.20
- 62 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V).Notes on consolidated financial statements-Continued
35. Financial expenses
Unit: RMB Yuan
Items Amount of current year Amount of last year
Interest expenses 246,051,596.92 170,566,720.97
Less: Capitalized interest expenses 44,697,588.67 43,671,973.12
Less: Interest income 6,681,077.09 3,212,235.52
Exchange balance 475,293.52 2,559,927.62
Others 9,149,725.22 2,055,364.03
Total 204,297,949.90 128,297,803.98
36. Impairment loss of assets
Unit: RMB Yuan
Items Amount of current year Amount of last year
I. Bad debt loss 1,175,743.88 (1,401,978.50)
II. Losses on inventory depreciation 15,854,028.57 4,589,340.59
III. Losses on fixed assets depreciation 6,265,762.65 5,620,433.76
I (V). Losses on construction in progress depreciation 226,400.00 753,840.36
(V). Losses on other assets depreciation - 1,633,199.83
Total 23,521,935.10 11,194,836.04
37. Investment income
(1) Detail investment income
Unit: RMB Yuan
Items Amount of current Amount of last year
year
Investment income on equity method (90,201,890.81) (49,082,776.11)
Investment income on disposal of long-term equity 113,531,216.51 (47,678.00)
Total 23,329,325.70 (49,130,454.11)
(2) Investment income on equity method Unit: RMB Yuan
Amount of current Amount of last Reason on changes in the current
Investment unit year year year compared to last year
CPI JIANXI XINCHANG POWER Changes on net income of
(90,201,890.81) (49,082,776.11)
GENERATION CO.,LTD Investment unit
No significant limits exist in repatriation of investment income.
- 63 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V). Notes on consolidated financial statements-Continued
38、Non-operating income
(1)Detail non-operating income
Unit: RMB Yuan
Non-recurring profit
Amount of current Amount of last and loss amount in
Items year year current period
Total disposal gains and losses on
4,732,446.60 11,234,912.70 4,732,446.60
non-current assets:
Disposal gains and losses on fixed
4,732,446.60 11,234,912.70 4,732,446.60
assets
Government subsidy 1,292,207,296.10 650,709,673.81 245,208.34
Value-added tax restitution on
214,622,872.15 140,642,403.84 214,622,872.15
imported natural gas (Note 1)
Compensation on unit capacity - 25,678,800.00 -
Others 5,228,236.41 4,051,057.71 5,228,236.41
Total 1,516,790,851.26 832,316,848.06 229,561,210.10
Note 1：Value-added tax restitutions on imported natural gas are RMB 151,365,319.02 and RMB 63,257,553.13
this year, obtained from CNOOC Gas & Power Group(Guangdong Trade Branch) by Weimei Power
company and our company respectively .
(2)Detail government subsidy
Unit: RMB Yuan
Items Amount of current year Amount of last year Notes
Income on fuel subsidy 636,055,900.00 320,502,966.41 Note
1
Note
Income on fuel processing fees subsidy 655,906,187.76 330,156,707.40
2
Special funds on energy-saving - 50,000.00
National debt subsidy on sludge drying project 233,750.00 -
Recycling economy supporting funds on sludge
11,458.34 -
drying project
Total 1,292,207,296.10 650,709,673.81
Note 1: Income on fuel subsidy of the company in the year of 2011 is RMB 636,055,900.00 based on
calculation method prescribed in Notification on Temporary Charges scheme on Fuel Processing Fees to
Subsidy Local Gas Turbine Power Plant of peak generation by Shenzhen Municipal, Shenfubang [2010]
No.74, Replied Letter on Definition of Shenzhen Gas Turbine Power Plant Subsidy Scheme in 2011 by
Shenzhen Municipal, K. G. M.X.W. [2011] No.206, and Notification on Shenzhen Local Gas Turbine
Power Plant Subsidy Management Temporary Method by Shenzhen Municipal, Shenfubang [2009]
No.54.
Note 2: Fuel processing subsidy for Zhongshan Company and Weimei Power company together in2011 are
RMB 655,906,187.76 based on related provisions prescribed in Notice on Temporary Charges of Fuel
Processing Fees (Yuefuhan [2008] No.31) by Guangdong Provincial Government and related
documents by Bureau of Price in Guangdong Province.
(V).Notes on consolidated financial statements-Continued
- 64 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
39. Non-operating expenses
Unit: RMB
Items Amount of Amount of last Non-recurring profit and loss amount
current year year in current period
Loss on disposal of fixed
4,985,709.23 16,537.00 4,985,709.23
assets
Loss on scrapped
- 477,348.21 -
inventories
Donation expenses 240,000.00 80,000.00 240,000.00
Others - 20.00 -
Total 5,225,709.23 573,905.21 5,225,709.23
40.Income tax expenses
Unit: RMB Yuan
Items Amount of current Amount of last
year year
Current income tax calculated on tax law and related provisions 12,313,851.50 7,430,010.28
Adjustment on deferred income tax 910,290.83 17,357,751.77
Total 13,224,142.33 24,787,762.05
The adjustment schedule of income tax expenses and accounting profits is as follows:
Unit: RMB Yuan
Items Amount of current Amount of last
year year
Accounting profits 22,255,754.48 (98,645,669.78)
Income tax expenses calculated on 24% tax rate (Last year: 22%) 5,341,381.08 (21,702,047.35)
Paying tax influence of non-deductible expenses 1,108,326.18 555,815.88
Paying tax influence of tax-free income 20,169,767.51 8,387,699.16
Paying tax influence of unrecognized deductible losses and the
10,880,622.62 18,045,285.60
contemporary differences
Paying tax influence of unrecognized deductible losses and the
(36,005,107.29) (7,400,516.36)
contemporary differences n previous years
Changes on deferred income tax assets/ debts balance in the
(43,577.10) (176,102.80)
beginning of the period due to tax rate adjustment
Influences on different tax rate of subsidiaries 11,772,729.33 10,128,476.87
Paying tax influence of repatriation of recognized deferred income
- 16,949,151.05
tax assets in previous years
Income tax expenses 13,224,142.33 24,787,762.05
- 65 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V).Notes on consolidated financial statements-Continued
41. Calculation on basic income per share and diluted income per share
Net income attributed to shareholders of parent company in current period during calculation on basic income
per share:
Unit: RMB Yuan
Items Amount of current year Amount of last year
Net income attributed to shareholders of parent company in
17,529,063.37 (114,638,678.20)
current period
Net income as a going-concern 17,529,063.37 (114,638,678.20)
Net income as a terminated business - -
Denominator is weighted average of outstanding ordinary shares during calculation on basic income per share:
Unit: Share
Items Amount of current Amount of last
year year
Outstanding ordinary shares in the beginning of the year 602,762,596 602,762,596
Add: weighted outstanding ordinary shares in current year - -
Less: weighted outstanding ordinary shares repurchased in current
- -
year
weighted outstanding ordinary shares at the end of the year 602,762,596 602,762,596
Income per share
Unit: RMB
Items Amount of current Amount of last
year year
Calculation on net profit attributed to shareholders of parent company:
Basic income per share 0.03 (0.19)
Diluted income per share Not applicable Not applicable
Calculation on net profit attributed to shareholders of parent company as
a going concern:
Basic income per share 0.03 (0.19)
Diluted income per share Not applicable Not applicable
Calculation on net profit attributed to shareholders of parent company as
a terminated business:
Basic income per share - -
Diluted income per share Not applicable Not applicable
No diluted potential ordinary shares are issued by the company. Therefore, income per diluted share is zero.
- 66 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V).Notes on consolidated financial statements-Continued
42. Notes on Statement of Cash Flows
(1)Cash received from operating activities
Unit: RMB Yuan
Items Amount of current year Amount of last year
Income on fuel subsidy 870,805,655.00 223,691,620.79
Special funds on economic development - 1,500,000.00
Interest income 6,681,077.09 3,740,184.55
Value-added tax restitution on imported natural gas 214,622,872.15 140,642,403.84
Compensation on unit capacity - 25,678,800.00
Special funds on energy-saving - 50,000.00
Others 3,422,084.62 4,714,040.32
Total 1,095,531,688.86 400,017,049.50
(2) Cash paid for operating activities
Unit: RMB Yuan
Items Amount of current year Amount of last year
Leasing expenses 6,978,347.03 6,635,278.50
Social expenses 5,258,373.43 5,238,625.72
Fleet expenses 4,095,752.61 3,837,816.94
Agency expenses 3,171,158.21 4,275,658.85
Others 1,052,676.93 1,869,727.54
Total 20,556,308.21 21,857,107.55
(3)Cash received from financing activities
Unit: RMB Yuan
Items Amount of current year Amount of last year
Guaranty funds received - 12,800,000.00
(4) Cash paid for financing activities
Unit: RMB Yuan
Items Amount of current year Amount of last year
Guaranty funds paid 52,536,060.00 -
Paid loans from third parties (Note) - 74,838,156.81
Total 52,536,060.00 74,838,156.81
Note: The loans paid back to Xingzhong Group and Bureau of Finance in Zhongshan Municipal by Shenzhong
Development Co., Ltd.
- 67 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(V).Notes on consolidated financial statements-Continued
43. Supplementary data on Statement of Cash Flows
Supplementary data on Statement of Cash Flows:
Unit: RMB Yuan
Amount of current Amount of last
Supplementary data
year year
1．Reconciling net income with cash flows from operating
activities:
Net income 9,031,612.15 (123,433,431.83)
Add: Impairment of Assets 23,521,935.10 11,194,836.04
Depreciation of Fixed assets and investment property 210,819,287.24 178,247,111.12
Amortization of intangible assets 3,301,244.81 3,263,423.08
Amortization of long-term amortized expenses 177,401.80 211,800.96
Losses (gains) on disposal of fixed assets, intangible
253,262.63 (11,218,375.70)
assets and other long-term assets
Financial expenses(income) 201,354,008.25 127,368,970.33
Investment Losses (income) (23,329,325.70) 49,130,454.11
Decrease(increase) in deferred income tax assets 910,290.83 15,985,437.11
Decrease(increase) in inventory 78,322,586.24 (11,760,843.34)
Decrease(increase) in operating receivables (433,109,183.26) (199,972,199.01)
Decrease(increase) in operating payables 201,032,221.17 (13,119,237.90)
Net cash flows provided by operating activities 272,285,341.26 25,897,944.97
2．Non cash major investing and financing activities:
Debt to capital conversion - -
Convertible bonds due within one year - -
Fixed assets leased through financing - -
3．Changes in cash and cash equivalents
Ending balance of cash and cash equivalents 629,318,992.12 591,386,814.04
Less: Beginning balance of cash and cash equivalents 591,386,814.04 356,362,100.63
Net increase in cash and cash equivalents 37,932,178.08 235,024,713.41
(2) Cash and cash equivalents
Unit: RMB Yuan
Amount in the beginning of the Amount at the end of the
Items year year
I. Cash 629,318,992.12 591,386,814.04
Cash on hand 256,716.21 207,875.16
Cash in bank 628,449,391.91 590,685,309.79
Other currencies on hand 612,884.00 493,629.09
II. Ending balance of cash and cash
equivalents 629,318,992.12 591,386,814.04
- 68 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(VI).Related parties and related party transactions
1. Parent company
Parent company does not exist for the reason that share proportions of any shareholders do not exceed 50% and
no control relation will be formed through other ways.
2.Subsidiaries
Detail of subsidiaries can be referred to appendix (IV).
3. Other related parties
Organization
Other related parties Relation with the company
code
Shareholder exerting significant influence
Energy Group Co., Ltd. 192189185
on the company
Weimei Ceramics Co., Ltd. Minority shareholder 72919361X
Xingzhong Group Minority shareholder 733112675
Shenzhen Mawan Power Co., Ltd, (―Mawan
Subsidiaries of Energy Group Co., Ltd. 618816706
Power Co., LTD‖)
Shenzhen Moonport Oil Co., Ltd. (―Moonport
Subsidiaries of Energy Group Co., Ltd. 618849428
Oil Co., Ltd.‖)
Energy Corporation Subsidiaries of Energy Group Co., Ltd. 19224115-8
Directors and Executives Key managers Not applicable
4. Related party transactions
(1)Purchase & sale of commodities and provision & receipt of services
Purchase of commodities and receipt of services schedule
Unit: RMB Yuan
Related Related party Contents Price setting and Amount of current year Amount of last year
Parties transactions decision making of Amounts Proportion in the Amounts Proportion in the
related party same transactions same transactions
transactions (%) (%)
Mawan Power Purchase of Fuel Price issued by charging - - 21,140,652.48 0.98
Co., Ltd. commodities departments or market
price
Mawan Power receipt of Pipe Price issued by charging - - 181,955.27 100.00
Co., Ltd. services expenses departments or market
price
Moonport Oil receipt of Wharfage Price issued by charging - - 877,857.45 100.00
Co., Ltd. services departments or market
price
(2)Related party financing
This year:
Unit: RMB Yuan
Related parties Financed amount Beginning day Ending day Ending balance Explanation
Borrowing
Xingzhong Group 125,316,816.85 2011.01.01 2011.12.31 125,316,816.85 Renewal
Xingzhong Group 23,750,000.00 2011.01.01 2011.12.31 23,750,000.00 Renewal
Xingzhong Group 16,250,000.00 2011.01.01 2011.12.31 16,250,000.00 Renewal
Xingzhong Group 14,335,291.80 2011.01.01 2011.12.31 14,335,291.80 Renewal
Xingzhong Group 2,500,000.00 2011.01.01 2011.12.31 2,500,000.00 Renewal
- 69 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Weimei Ceramics Co., LTD 35,785,979.94 2011.07.16 2012.07.16 35,785,979.94
(VI).Related parties and related party transactions -Continued
4. Related party transactions -Continued
(2) Related party financing-Continued
Last year:
Unit: RMB Yuan
Related parties Financed amount Beginning day Ending day Ending balance Explanation
Borrowing
Xingzhong
125,316,816.85 2008.11.19 2010.12.31 125,316,816.85 Note
Group
Xingzhong 2009.10.15
23,750,000.00 2010.12.31 23,750,000.00
Grouop
Xingzhong 2009.03.27
16,250,000.00 2010.12.31 16,250,000.00
Group
Xingzhong 2008.12.29 Note
14,335,291.80 2010.12.31 14,335,291.80
Group
Xingzhong 2009.03.27
2,500,000.00 2010.12.31 2,500,000.00
Group
Note: the amounts are borrowed in October 15, 2007 and November 19, 2007. The borrowing period is one year
which can be renewed at the end of period.
(3) Asset transfer of related party
Unit: RMB Yuan
Amount of current year Amount of last year
Related party Amounts Proportion in Amounts Proportion in
Related Related party Price
transaction the same the same
party transaction setting
content transactions transactions
(%) (%)
10% share transfer
Energy of Energy
Market
Group Environmental Asset transfer 123,078,900.00 36.19 - -
price
Co., Ltd. Protection company
shares
(4)Remuneration for key managers
Unit: RMB Yuan
Item Amount of current
year Amount of last year
Remuneration for key managers 7,311,300.00 7,162,700.00
(5)Capital occupying fee
Unit: RMB
Amount of current year Amount of last year
Related
Related Amounts Proportion in Amounts Proportion in
party Price
Related party party the same the same
transactio setting
transaction transactions transactions
n content
(%) (%)
Capital
Xingzhong Interest 11,192,994.0
occupying Note 90.99 9,906,544.84 100.00
Group expenses 8
fee
Weimei Capital
Interest
Ceramics Co., occupying Note 1,108,570.13 9.01 - -
expenses
Ltd. fee
Note: Capital occupying fee is calculated based on equivalent flow fund borrowing rate in bank.
- 70 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
- 71 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(VI).Related parties and related party transactions –Continued
4. Related party transactions -Continued
(5) Receivables and Payables of Related parties
Payables of Related parties
Unit: RMB Yuan
Items Related parties Ending balance Beginning balance
Other payables Xingzhong Group 182,152,108.65 182,152,108.65
Weimei Ceramics Co., Ltd. 36,385,912.01 -
Prepaid amount Energy Corporation 14,586,000.00 14,586,000.00
Interest payable Xingzhong Group 43,299,375.93 32,106,381.85
(VII).Contingency
In March 2008, Contract confirmations (referred to as ―confirmation‖)of Contract 165723967102.11 and
165723968102.11 had been signed between Jierun Corporation and the company.
The validity period of first confirmation is from March 3, 2008 to December 31, 2008. And the confirmation
consists of three option contracts. The company can obtain USD 300,000 each month (200,000 barrels*
USD1.50 /barrel) when the floating price( Arithmetic average of closing price on light crude oil futures
contracts in current month at New York Commodity Exchange during each deciding time limit) is higher than
USD 63.50 each barrel; the company can obtain benefits of (floating price- USD 63.5 /barrel )*200,000
barrels, when the floating price is higher than USD 62.00/barrel and lower than USD 63.50/barrel; the
company shall pay USD or equivalents of (USD 62.00/barrel-floating price) *400,000 barrels to Jierun
Corporation, when the floating price lower than USD 62.00/barrel.
The validity period of second confirmation is from January 1, 2009 to October 31, 2009. And the confirmation
consists of three option contracts. Jierun Corporation has the implement options before 1800 o’clock,
December 30, 2008. The company can obtain USD 340,000 each month (200,000 barrels* USD1.70 /barrel)
when the floating price is higher than USD 66.50 each barrel; the company can obtain benefits of (floating
price- USD 64.8 /barrel )*200,000 barrels, when the floating price is higher than USD 64.80/barrel and lower
than USD 66.50/barrel; the company shall pay USD or equivalents of (USD 64.50/barrel-floating price)
*400,000 barrels to Jierun Corporation, when the floating price lower than USD 64.50/barrel.
From April to October 2008, Jierun Corporation has depended on the above two confirmation letters and paid 2.10
million USD (converted to RMB 14,352,083.46 RMB) to our company. Our company has calculated received expense
into ―other payable‖.
- 72 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(VII).Contingency - Continued
On November 6, 2008, Jierun Corporation has sent a letter to the company and maintained that company has
expressed fulfillment failure of the transaction according to the announcement on October 21st, 2008 and
meeting opinions on October 29, 2008 and has constituted breach of contract. It has thus announced transaction
termination. The company has replied to Jierun Corporation and expressed that company has never expressed
fulfillment failure of the transaction and maintained that Jierun Corporation has personally rescinded the
contract and refused to pay payable expense under the first copy of confirmation letter until October 2008—it
has constituted breach of contract and the company has announced transaction termination. Although the two
parties have terminated the confirmation letter and transaction by different reasons, yet they do not have any
discrepancy in the termination fact of confirmation letter and transaction. After the transaction termination,
Jierun Corporation has sent a letter and required the company to compensate for the transaction termination
losses; at the same time, it has sent a letter to express hope for dispute settlement through commercial measures.
The company has replied a letter and refused to accept Jierun Corporation’s compensation requirements; at the
same time, it has sent another letter for negotiation. Later, the two parties have launched out numerous
negotiations but failed to reach any common consensus. On November 27th, 2009, the company has received the
letter from Allen and Overy LLP. The letter has described the above matters and required the company to
compensate for Jierun Corporation’s losses of 79,962,943.00 USD and interest of 3,736,958.66 USD until
November 27th, 2009. The company has replied a letter on January 25th, 2010 and refused to accept the losses
compensation requirements.
On March 31st, 2011, Jierun Corporation has sent another letter to the company and announced default expense
of 79,962,943.00 USD and interest as of November 6th, 2008. It is willing to continue to cooperate with the
company for settlement of this issue and has invited the company to raise settlement suggestions. At the same
time, Jierun Corporation has emphasized its reservation of all the rights to this matter. The company has replied
a letter on April 6th, 2011 and refused to accept Jierun Corporation’s losses compensation requirements and is
willing to accept Jierun Corporation’s invitation and launch out negotiation under the prerequisite of not
affecting their rights. Once the company management level judge negotiation failure, it does not eliminate
dispute settlement possibility through judicial measures.
On February 6, 2012, Jierun Corporation has sent a letter again to the company, asking for money in arrears of
USD 83,699,901.66 and related interests. On February 10, 2012, the company has replied Jierun Corporation,
not adopting the compensation requirements from Jierun Corporation and asking for payables of USD
300,000.00 occurred since October 2008 and interests since November 7, 2008 under No. 165723967102.11
confirmation. The company is willing to negotiate and settle the matter in the way which will not affect rights of
both sides with the consideration of invitation from Jierun Corporation. If consensus cannot be reached, it is
possible to settle the dispute by judicial methods.
Board of directors in the company believes, based on the legal opinions from independent attorney:
(1)Both two confirmations and transactions have been terminated by both parties.
(2)It is impossible to estimate the possible settlements and results under current circumstance due to several
indefinite factors in the matter.
(3)Estimated liabilities shall not be recognized in the financial statements of 2011 due to the impossibly
estimated results of the matter.
Board of directors of the company will notify relevant accounting treatments timely based on the matter
progress.
- 73 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(VIII).Commitments
1、Capital commitments
Unit: RMB
Items Amount at the end of Amount at the end
the year of the year
Singed but unrecognized in financial statements
- Commitment to purchase long-term assets 17,900,039.34 22,732,380.00
2、Operating and leasing commitments
Irrevocable operating and leasing contracts signed externally at the date of Balance Sheet are as follows:
Unit: RMB
Items Amount at the end Amount at the end
of the year of the year
Minimum leasing payments of irrevocable operating and
leasing
First year after the date of Balance Sheet 3,378,118.33 4,394,861.29
Second year after the date of Balance Sheet 6,133,712.63 1,376,850.00
Third year after the date of Balance Sheet 1,427,596.50 1,389,536.63
Years afterward 65,009,429.93 66,616,466.43
Total 75,948,857.39 73,777,714.35
(IX).Subsequent events on Balance Sheet
Unit: RMB Yuan
Effected amount on Reasons
financial position and impossible to
Items Content operating results estimate
Investment On September 30, 2011, the fourth temporary general None Not applicable
meeting of shareholders had been held and Motion on
Capital Increase to Shenzhen Nanshan (Zhongshan) Electric
Power Co., Ltd. had been approved to increase capital of
RMB 350,000,000 Yuanto Zhongshan Power Company, and
the shareholders shall contribute in accordance with the
stork right ratio. Among which, the company had been
assigned to offer RMB 192,500,000 Yuan for holding 55%
of the stock, and Xingdesheng Company had been assigned
to offer RMB 87,500,000 Yuan for holding 25% of the
stock and Xingzhong Group had been assigned to offer
RMB 70,000,000 Yuan for holding 20% of the stock
Till the approval and submit day of the financial
statement, the company, Xingdesheng Company and
Xingzhong Group have already contributed the capital in
accordance with the resolution, relevant commercial and
industrial registration procedures are in progress.
（X） Other important matters
1. Borrowing costs
Unit: RMB Yuan
Item Amount of capitalized borrowing costs in Capitalization rate
current period
Goods in stock 44,697,588.67 6.14
Total capitalized borrowing costs in current 44,697,588.67
- 74 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
period
Borrowing costs reckoned in the profits and
201,354,008.25
losses in current period
Total borrowing costs in current period 246,051,596.92
- 75 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(X) Other important matters-Continued
2. Segment report
According to the internal organization structural, management requirements and internal reporting systems of
our group, the operation business of the group is classified into four reporting segments, i.e. power and heat
supply, fuel trade, power plant construction and other relevant business and real estate development. The
management of the group regularly evaluates the operation results of the reporting segments, so as to decide to
distribute resources to them and evaluate their achievements.
The segment report information is disclosed according to the accounting policies and measuring standards
adopted by all segments when reporting to the management, and such measuring bases are kept consistent with
the accounting and measuring bases upon preparation of the financial statements.
- 76 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(Ⅹ)Other important matters - Continued
2. Segment report–Continued
(1) Segment report information
Unit: RMB Yuan
Power plant construction
and other relevant
Items Power and heat supply Fuel trade Real estate development business Undistributed items Inter-segment offset Total
Current
Current year Last year Current year Last year Current year Last year year Current year Last year Current year Last year Current year Last year Current year
Business
income
Foreign trade 2,314,110,50 1,574,029, 10,874,172 2,855,478.1 81,032,69 24,168,96 2,415,817,73 1,601,730,4
- - 9,800,360.90 676,632.48 - -
income 3.62 394.14 .45 9 3.38 0.49 0.35 65.30
Inter-segment 18,709,970.4 50,980,191 25,118,111 48,280,291. 2,159,000 400,000.0 8,842,667. (46,418,847. (108,503,15
- - 431,765.02 - -
trade income 7 .84 .94 20 .00 0 56 43) 0.60)
Total segment
2,332,820,47 1,625,009, 35,992,284 51,135,769. 83,191,69 24,568,96 10,232,125.9 9,519,300. (46,418,847. (108,503,15 2,415,817,73 1,601,730,4
business - -
4.09 585.98 .39 39 3.38 0.49 2 04 43) 0.60) 0.35 65.30
income
Total statement
2,332,820,47 1,625,009, 35,992,284 51,135,769. 83,191,69 24,568,96 10,232,125.9 9,519,300. (46,418,847. (108,503,15 2,415,817,73 1,601,730,4
business - -
4.09 585.98 .39 39 3.38 0.49 2 04 43) 0.60) 0.35 65.30
income
Subdivisional 3,561,094,22 2,308,545, 34,279,942 48,798,735. 226,978.3 1,869,851. 64,783,44 10,402,12 16,042,723.2 2,576,178. (49,807,701. (113,428,22 3,626,619,60 2,258,764,3
expense 3.49 723.04 .58 87 6 41 1.41 9.90 8 22 06) 6.80) 8.06 91.64
Subdivisional
(1,228,273,7 (683,536,1 1,712,341. 2,337,033.5 (226,978.3 (1,869,851 18,408,25 14,166,83 (5,810,597.3 6,943,121. 3,388,853.6 4,925,076.2 (1,210,801,8 (657,033,9
business profits
49.40) 37.06) 81 2 6) .41) 1.97 0.59 6) 82 3 0 77.71) 26.34)
(losses)
Management 35,149,345.2 55,576,484. 5,614,666. 8,072,342.8 8,936,054. 8,142,739. 8,590,797 5,818,345. 39,248,022.5 18,316,516 97,538,885.6 95,926,428.
- -
expense 4 22 56 6 02 17 .29 22 3 .73 4 20
Financial 125,478,090. 84,071,406. (706,457.3 2,486,260. 4,967,564. (2,033,28 (3,367,96 79,772,659.0 42,339,675 (699,316.26 204,297,949. 128,297,80
103,100.67 184,022.52
expenses 52 43 1) 10 21 6.22) 5.80) 7 .95 ) 90 3.98
Investment 91,188,94 151,166,247. (49,130,45 (219,025,86 23,329,325.7 (49,130,45
- - - - - - - -
return 4.68 74 4.11) 6.72) 0 4.11)
(1,388,901,1 (823,184,0 87,993,07 (5,838,410.0 (11,649,29 (14,980,15 11,850,74 11,716,45 26,334,968.7 (102,843,5 (214,937,69 4,741,053.6 (1,489,309,3 (930,388,6
Business profit
85.16) 27.71) 7.24 1) 2.48) 4.79) 0.90 1.17 8 24.97) 6.83) 8 87.55) 12.63)
Non-business 719,183,406. 401,127,81 4,470,431. 8,189,147.5 5,178,379. 32,059,17 245,208.3 787,454,425. 390,940,70 1,516,790,85 832,316,84
- 259,000.00 -
income 93 5.30 09 9 08 5.72 4 82 9.45 1.26 8.06
Non-business 151,519.7 477,348.2
4,974,189.48 82,090.00 20.00 - - 14,447.00 100,000.00 - - - 5,225,709.23 573,905.21
expenditure 5 1
(674,691,967 (422,138,3 92,311,988 2,350,717.5 (6,470,913 16,601,67 12,095,94 11,702,00 813,689,394. 288,097,18 (214,678,69 4,741,053.6 22,255,754.4 (98,645,66
Total profit
.71) 02.41) .58 8 .40) 2.72 9.24 4.17 60 4.48 6.83) 8 8 9.78)
6,334,193.9 6,905,536. 3,944,363 2,699,793. 16,949,151 (233,088.11 (1,372,314.6 13,224,142.3 24,787,762.
Income tax 2,607,330.76 131,919.99 - 45,018.34 -
2 60 .08 41 .06 ) 7) 3 05
(677,299,298 (428,472,4 85,406,45 2,218,797.5 (6,470,913 16,556,65 8,151,586 9,002,210. 813,689,394. 271,148,03 (214,445,60 6,113,368.3 (123,433,4
Net profit 9,031,612.15
.47) 96.33) 1.98 9 .40) 4.38 .16 76 60 3.42 8.72) 5 31.83)
- 77 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(Ⅹ) Other important matters - Continued
2. Segment report - Continued
Unit: RMB Yuan
Power plant construction
Items Power and heat supply Fuel trade Real estate development and other relevant business Undistributed items Inter-segment offset Total
Current year Last year Current year Last year Current year Last year Current year Current year Last year Current year Last year Current year Last year Current year
Total subdivisional 3,985,686,884. 3,582,479,751. 453,571,505 371,605,020 1,191,800,881. 1,181,805,033. 325,782,913 316,989,922 3,417,914,98 2,770,795,09 (3,922,010,48 (2,944,720,47 5,452,746,68 5,278,954,34
assets 83 19 .43 .14 62 59 .43 .55 1.73 5.82 4.13) 3.39) 2.91 9.90
Total subdivisional (1,009,701,74 (1,836,510,43 37,352,328. 40,784,255. 1,041,079,656. 1,024,612,894. 192,496,978 107,040,636 6,956,704,74 6,681,686,61 (3,652,996,28 (2,671,117,97 3,564,935,68 3,346,495,99
liabilities 0.93) 3.07) 55 24 08 65 .00 .33 9.96 9.00 1.80) 3.06) 9.86 9.09
Additional
information:
Depreciation and
204,365,548.7 177,507,241.0 6,729,826.0 6,921,264.1 6,412,062.1 214,297,933. 181,722,335.
amortization 151,859.27 305,402.35 498,420.22 2,136,442.90 1,815,083.66 (5,497,805.35) (5,325,076.20)
7 0 9 3 7 85 16
expenses
1,156,388.1 6,452,791.6 3,979,149.7 75,559,381.1 58,513,979.1 (94,568,915.1 (70,078,567.3
Interest income 13,241,610.20 7,184,449.93 31,081.69 4,839,821.07 3,582,142.30 6,681,077.09 3,212,235.52
8 0 5 8 6 4) 1)
135,181,513.9 4,254,685.4 149,170,488. 99,980,043.3 (94,568,915.1 (70,078,567.3 201,354,008. 126,894,747.
Interest expenditure 87,870,425.29 - - 7,316,235.60 8,538,307.19 584,539.38
8 4 36 0 3) 1) 25 85
Impairment loss
(1,128,922. (500,207.00 (1,401,978. 23,521,935.1 11,194,836.0
confirmed in the 22,119,791.22 12,092,537.18 216,395.00 - 1,633,199.83 1,736,004.16 - (50,048.28) -
47) ) 50) 0 4
current period
Investment benefits
confirmed by
long-term stock right (90,201,890.8 (49,082,776.1 (90,201,890.8 (49,082,776.
- - - - - - - - - -
investment as 1) 1) 1) 11)
verified through
equity method
92,860,116.2 68,581,424.4 2,006,340. 26,855,475 13,869,338 13,125,516.2 16,949,852.9 (1,350,000.00 133,931,267. 98,081,497.
Capital expenditure - 33,820.00 30,882.00 (950,000.00)
4 6 31 .15 .28 4 1 ) 94 65
Wherein:
Expenditure for 1,846,636.9 26,661,096. 13,775,038. 13,073,934.4 131,119,234. 70,271,665.0
90,487,566.56 49,825,059.85 - - - 7,621,566.91 (950,000.00) (950,000.00)
projects under 8 15 28 5 14 4
construction
Expenditure for
18,497,666.6
purchasing fixed 2,372,549.68 18,756,364.61 27,891.67 - 33,820.00 30,882.00 194,379.00 94,300.00 51,581.79 16,120.00 - (400,000.00) 2,680,222.14
1
assets
Expenditure for
purchasing - - 131,811.66 - - - - - - 9,312,166.00 - - 131,811.66 9,312,166.00
intangible assets
- 78 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(X) Other important matters-Continued
3. Financial tools and risk management
Major financial tools of our group include equity investment, deposits held in banks, loan, accounts receivable,
other accounts receivable, accounts payable, other accounts payable and etc, of which the detailed explanation
can be found in Note (V). Risk related to these financial tools and the policies of risk management adopted to
reduce these risks of our group are illustrated as below. The management layer of our group manages and
monitors these risk exposure to control the above risks in limited range.
(1) Target and policy of risk management
The target of our group to undertake risk management is to balance the risk and profit and reduce the negative
influence of these risks to the operating performance of our group so as to maximize the profits of stockholders
and other equity investors. Based on the target of the risk management, the basic strategy of our company’s risk
management is to ensure and analyze all risks confronted before our group, establishing proper deadline of risk
enduring, conducting risk management, reliably supervising all risks in time and controlling the risks in limited
range
1.1 Market risk
1.1.1 Risk of foreign exchange
Risk of foreign exchange refers to the risk of loss produced from the fluctuation in exchange rate. The enduring
foreign exchange risk of our group is mainly related to the HKD, USD, Euro and SGD. Except part of
subsidiaries conducting purchase and sale with HKD, USD, Euro and SGS, other major business of our group
are evaluated and settled through RMB. On December 31, 2011, except the stated assets as below are remaining
balance of HKD, USD, Euro and SGD, the asset and liability of our group are remaining balance of RMB. The
foreign exchange risk produced from the asset and liability of the foreign currency’s remaining balance may
influence the operating performance of our group.
Unit: RMB Yuan
Amount in the
Amount at the end of beginning of the
Items the year year
Cash and money equivalent-USD 12,417,149.30 10,993,828.42
Cash and money equivalent- Euro 8,308.37 8,963.88
Cash and money equivalent-HKD 736,734.06 4,639,415.66
Cash and money equivalent-SGD 481,337.03 113,361.80
Other accounts receivable-USD 1,695,323.96 2,684,814.93
Other accounts receivable-HKD - 434,063.79
Other accounts receivable-SGD 463,465.14 15,679.80
Accounts payable-USD 49,740.70 52,281.05
Other accounts payable-USD 13,859,889.14 13,172,461.88
Other accounts payable-HKD - 508,226.00
Other accounts payable-SGD 1,370,194.55 1,485,283.10
Our group pays close attention to the influence on the foreign exchange risk of the fluctuation in exchange rate.
So far, our group has not yet adopted any measures to avoid foreign exchange risk.
- 79 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(X ) Other important matters-Continued
3. Financial tools and risk management-Continued
Target and policy of risk management-Continued
1.1.2. Interest rate risk- Risk of cash flow’s fluctuation
The risk of cash flow’s fluctuation of the financial tools caused by the fluctuation of interest rate in our group
has much to do with the bank loan’s floating interest rate. (Referring to the Note V for the detail) Our policy is
to hold the floating rate of the loan and eliminate fluctuation risk of the interest rate caused by the fluctuation of
interest rate.
1.2 Credit risk
December 31, 2011, the biggest credit risk exposure that probably causes financial loss of our group is mainly
from the other party of the contract which can not fulfill the liabilities and lead to the financial loss.
Our company examines and verifies the recovering condition of each single account receivable in every balance
sheet date to count and draw sufficient preparation of bad debt in accordance with the fund that is unable to get
recovered.
Since the working capital of our company is stored in the bank with higher credit, the credit risk of working
capital is lower.
1.3 Liquidity risk
While manage liquidity risk, our group keeps and monitors sufficient cash and money equivalent confirmed by
management layer to satisfy the operating need and lower the influence from the floating of cash flow. The
management layer monitors the utilization of bank loan and obeys the loan treaty.
Our company regards bank loan as main source of funds. December 31, 2011, bank credit limit that has not been
used is RMB 1,070,322,657.14(December 31, 2010: RMB 1,412,600,000.00Yuan).
- 80 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
( X ) Other important matters- Continued
3. Financial tools and risk management- Continued
(1) Target and policy of risk management-Continued
1.3 Liquidity risk-Continued
The financial asset and financial liability our company holds are analyzed as below according to the deadline of
the responsibilities on the contract that has not been discounted and still remained left.
Unit: RMB Yuan
Items Within one year 1-5 years More than 5 years
Fund of currency 695,095,052.12 - -
Accounts receivable 934,640,019.03 - -
Other accounts receivable 124,599,842.72 - -
Short-term loan 3,396,816,761.64 - -
Bill payable 43,820,200.00 - -
Accounts payable 214,748,889.66 - -
Interest payable 75,462,594.51 - -
Other accounts payable 358,597,380.00 - -
Non-flow liability due in one
50,828,972.60 - -
year
Long-term loan 1,790,880.00 7,163,520.00 27,285,508.38
(2) Fair value
The fair value of the financial assets and financial liabilities is determined according to the following methods:
The fair value of the financial assets and financial liabilities with standard clauses and conditions and existing
in the active market is determined respectively by referring to the current pricing and quotation of the
active market;
The fair value of other financial assets and financial liabilities (excluding derivative instruments) is determined
according to the general pricing model based on the future cash flow discount method or by the observable
current market transaction price;
The fair value of the derivative instruments is determined by the public quotation of the active market. If
public quotation does not exist, the fair value of the derivative instruments without option is estimated and
determined with the future cash flow discount method based on the appropriate return curve; and the fair
value of the derivative instruments with options is calculated and determined according to the option
pricing model (e.g. the binomial model).
The management of the group thinks the book value of the financial assets and financial liabilities measured by
the amortized cost in the financial statements is close to the fair value of such assets and liabilities.
- 81 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
( X ) Other important matters- Continued
3. Financial tools and risk management- Continued
(3) Sensitivity analysis
Our company adopts sensitivity analysis to technically analyze what kind of influence the rational and possible
change of the risk variation produced on the current balance or the stockholders’ interest. Since no risk variation
change isolatedly and the dependence existing in the variation plays an important role in the
3.1 Risk of foreign exchange
While other variation remaining invariable, the possible and rational fluctuation of exchange rate influence the
current balance and stockholders’ interest before tax as below:
Unit: RMB Yuan
This year Last year
Influence on Influence on Influence on Influence on
profit rights and interest profit rights and
Fluctuation of of stockholders interest of
Item exchange rate stockholders
All foreign 5%
currency Appreciation to 26,124.67 26,124.67 (183,593.81) (183,593.81)
the RMB
All foreign 5% Devaluation
(26,124.67) (26,124.67) 183,593.81 183,593.81
currency to the MB
3.2 Interest rate risk
3.2.1 Sensitivity analysis of interest rate risk is based on the below assumption:
The change of market rate influences the interest income or fees of financial tools with changeable interest
rate.
3.2.2 On the basis of above assumption, with other variation remaining invariable, the rational fluctuation that
interest rate may occurred influences the current balance and interests of stockholders before tax as below:
Unit: RMB Yuan
This year Last year
Influence on Influence on rights Influence on Influence on rights
Fluctuation of profit and interests of profit and interests of
Item interest rate stockholders stockholders
Loan with Interest rate
floating floating 1 % (24,070,000.00) (24,070,000.00) (21,400,000.00) (21,400,000.00)
interest rate Upward
Loan with Interest rate
floating floating 1 % 24,070,000.00 24,070,000.00 21,400,000.00 21,400,000.00
interest rate downward
- 82 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements
1. Accounts receivable
(1) Accounts receivable are exposed according to the categories:
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Preparation of Preparation of bad
Carrying amount bad debt Carrying amount debt
Proport Amou Proport Proport Proport
Category Amount ion (%) nt ion (%) Amount ion (%) Amount ion (%)
Accounts receivable with
great single amount and
- - - - - - - -
counting and drawing of bad
debt preparation
Accounts receivable with no
great single amount or great
646,023,065.42 100.00 - - 277,107,630.12 100.00 - -
single amount without
devaluation after test
No major single amount but
with accounts receivable of
- - - - - - -
bad debt preparation counted
and drawn of single term
In total 646,023,065.42 100.00 - - 277,107,630.12 100.00 - -
Age analysis of accounts receivable as below:
Unit: RMB Yuan
Amount at the end of the year Amounts in the beginning of year
Preparati Preparati
Proport Carrying Proport Carrying
Age of Amount on of Amount on of
ion (%) amount ion (%) amount
account bad debt bad debt
With 1 year 645,982,237.80 99.99 - 645,982,237.80 277,104,741.12 100.00 - 277,104,741.12
1~2 years 37,938.62 0.01 - 37,938.62 - - - -
2~3 years - - - - 2,889.00 - - 2,889.00
Over 3 year 2,889.00 - - 2,889.00 - - - -
In total 646,023,065.42 100.00 - 646,023,065.42 277,107,630.12 100.00 - 277,107,630.12
(2) There is no accounts receivable with great amount but counting and drawing bad debt preparation separately.
(3) There is no balance of amount receivable of stockholders who hold over 5 %( containing 5 %) of vote stock.
(4) Top five units with accounts receivable
Unit: RMB Yuan
Relations with Proportion in the general
Name of units our company Amount Age limit accounts receivable
Government Within one year
564,250,490.62 87.34
Shenzhen Bureau of Finance department
Irrelevant Within one year
81,253,737.90 12.58
Guangdong Grid Corporation customer
Irrelevant Within one year
194,386.50 0.03
Shenzhen University customer
Zhongcai Energy Management Irrelevant Within one year
170,887.80 0.03
Service.Co customer
Shenzhen Nanshan Meet Irrelevant Within one year
91,458.00 0.01
Processing Factory customer
In total 645,960,960.82 99.99
- 83 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
2. Other accounts receivable
(1) Other accounts receivable are exposed according to categories:
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Category Carrying remaining Preparation of bad debt Carrying remaining Preparation of bad debt
Proporti Proporti Proporti Proporti
Amount Amount Amount Amount
on(%) on (%) on (%) on (%)
Other accounts receivable
with great single amount and
22,677,404.46 1.46 22,677,404.46 100.00 22,677,404.46 2.47 22,677,404.46 100.00
counting and drawing of bad
debt preparation
Other accounts receivable
with no great single amount
1,523,503,252.69 98.19 - - 892,922,760.15 97.23 - -
or great single amount
without devaluation after test
Other accounts receivable
with no great single amount
5,362,330.44 0.35 3,140,957.25 58.57 2,729,502.62 0.30 1,404,953.09 51.47
but preparation of counting
and drawing of single term
In total 1,551,542,987.59 100.00 25,818,361.71 1.66 918,329,667.23 100.00 24,082,357.55 2.62
Age analysis of other accounts receivable as below:
Unit: RMB Yuan
Amount at the end of the year Amount in the beginning of the year
Propo Prop
Age of rtion Preparation Carrying ortio Preparation Carrying
account Account (%) of bad debt account Account n (%) of bad debt account
Within
683,777,747.42 44.07 - 683,777,747.42 55,697,645.24 6.06 - 55,697,645.24
one year
1~2
46,951,064.34 3.03 - 46,951,064.34 261,428,722.35 28.47 - 261,428,722.35
years
2~3year
242,850,051.86 15.65 173,524.12 242,676,527.74 100,975,970.51 11.00 - 100,975,970.51
s
Over 3
577,964,123.97 37.25 25,644,837.59 552,319,286.38 500,227,329.13 54.47 24,082,357.55 476,144,971.58
years
100.0
In total 1,551,542,987.59 100.00 25,818,361.71 1,525,724,625.88 918,329,667.23
0
24,082,357.55 894,247,309.68
(2) Other accounts receivable of which the single amount is not that great with bad debt preparation counted and
drawn separately:
Unit: RMB Yuan
Amount of
Proportion of
Content of other accounts Carrying counting and
counting and Reason
receivable amount drawing bad debt
drawing
preparation
Guarantee deposit Overdue part cannot be
3,278,632.28 1,404,953.09 42.85
receivable withdrawn
Dormitory amount Overdue part cannot be
2,083,698.16 1,736,004.16 83.31
receivable withdrawn
In total 5,362,330.44 3,140,957.25 58.57
(3) There is no balance of other amount receivable of stockholders who hold over 5 %( containing 5 %) of vote
stock.
(4) Top five units with other accounts receivable
- 84 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Unit: RMB Yuan
Proportion in the
Relation with general accounts
Name of company our company Amount Age limit receivable (%)
Shenzhong Subsidiary Within 1 year to over 44.38
688,629,880.98
Development Co., Ltd. 3 years
Zhongshan Electric Subsidiary Within 1 year to over 40.36
626,243,082.60
Power Co., Ltd. 3 years
Jiangxi Zhongdian Irrelevant
106,342,100.00 Within 1 year 6.85
Corporation customer
Weimei Electric Power Subsidiary Within 1 year and 1 5.51
85,437,069.99
Co., Ltd. to 2 years
Huiyang Kangtai Cooperation Over 3 years 0.92
Industrial Corporation party of the 14,311,626.70
project
Total 1,520,963,760.27 98.02
(5) Accounts receivable of related party refers to the Note (XI) 7
- 85 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
3. Long-term equity investment
Detail of long-term equity investment as below:
Unit: RMB Yuan
Inconsistent Prepa
Share Counting and
Proportion explanation of share ration
Business holding drawing
Cost of Beginning Fluctuation of of vote right holding proportion of Cash bonus in
The invested entity accounting Ending balance proportion devaluation
investment balance increase ( decrease) in invested and vote right deval this year
method in invested preparation in
unit (%) proportion in invested uatio
unit (%) this year
unit n
Cost
Xiefu Oil Supply Co., Ltd. 26,650,000.00 26,650,000.00 - 26,650,000.00 50.00 50.00 Not applicable - - -
method
Cost Not applicable
New Electric Power Co., Ltd. 71,270,000.00 71,270,000.00 - 71,270,000.00 75.00 75.00 - - -
method
Zhongshan Electric Power Co., Cost Not applicable
218,240,000.00 218,240,000.00 - 218,240,000.00 55.00 55.00 - - -
Ltd. method
Cost Not applicable
Engineering Company 6,000,000.00 6,000,000.00 - 6,000,000.00 60.00 60.00 - - 56,264,962.17
method
Cost Not applicable
Weimei Electric Power Co., Ltd. 115,319,049.76 115,319,049.76 - 115,319,049.76 40.00 40.00 - - 71,571,959.87
method
Cost Not applicable
Shennan Company Singapore 6,703,800.00 6,703,800.00 - 6,703,800.00 100.00 100.00 - - -
method
Environmental Company( Note Cost Not applicable
55,300,000.00 46,340,000.00 8,960,000.00 55,300,000.00 70.00 70.00 - - -
1) method
Cost Not applicable
Shenzhong Development Co., Ltd - - - - 75.00 75.00 - - -
method
Cost Not applicable
Shenzhong Real Estate Co., Ltd. - - - - 75.00 75.00 - - -
method
Energy Environmental Cost Not applicable
89,671,000.00 41,790,000.00 (41,790,000.00) - 10.00 10.00 - - -
Company( Note 2 ) method
Cost Not applicable
Jiangxi Nuclear Power Co., Ltd 37,315,000.00 37,315,000.00 - 37,315,000.00 5.00 5.00 - - -
method
Right and Not applicable
Jiangxi Xinchang Co., Ltd ( Note
profit 286,285,715.00 227,103,274.30 (227,103,274.30) - 30.00 30.00 - - -
2)
method
127,836,922.0
In total 864,873,564.76 796,731,124.06 (259,933,274.30) 536,797,849.76 - -
4
Decrease: Devaluation
- -
preparation
Net amount of long-term equity
796,731,124.06 536,797,849.76
investment
Note 1: On January 28, 2011, our company handed in the second segment capital 8,960,000.00 to environmental protection company. So far, the capital to
environmental protection company has been sufficient. The above contribution of capital has been inspected by Shenzhen Zhongfa Accounting Firm
which has provided capital verification report S.Z.F.(W)Y..Z.[2011] No.2.
Note 2: Details refer to Note (V)8.
- 86 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
4. Operating income, operating cost
(1) Operating income
Unit: RMB Yuan
Item Amount incurred in Amount incurred in
this year last year
Major business income 903,571,321.23 385,171,238.11
Other business income 86,708,420.29 41,800,634.74
Operating cost 1,598,330,636.84 765,825,140.43
(2) Major business (different industries)
Unit: RMB Yuan
Amount incurred in this year Amount incurred in last year
Operating Operating cost Operating income Operating cost
Name of industry income
Energy business 903,571,321.23 1,545,500,300.35 385,171,238.11 764,932,810.44
(3) Major business (different products)
Unit: RMB Yuan
Amount incurred in this year Amount incurred in last year
Operating Operating cost Operating income Operating cost
Name of products income
Electric power sale 897,391,552.02 1,537,625,216.47 383,410,977.08 758,156,861.40
Heat power sale 6,179,769.21 7,875,083.88 1,760,261.03 6,775,949.04
In total 903,571,321.23 1,545,500,300.35 385,171,238.11 764,932,810.44
(4) Major business (different areas)
Unit: RMB Yuan
Amount incurred in this year Amount incurred in last year
Name of areas Operating income Operating cost Operating income Operating cost
Inland 903,571,321.23 1,545,500,300.35 385,171,238.11 764,932,810.44
(5) Operating income of our top five customers:
Unit: RMB Yuan
Proportion on the whole
Name of customer Operating income operating income (%)
Shenzhen Power Supply Bureau of
897,391,552.02 90.62
Guangdong Power Grid Corporation
Shenzhen Xiyang Petroleum Chemical
41,275,312.26 4.17
Industry Co., Ld
New Electric Power Company 22,586,300.24 2.28
Yuehe Petroleum Chemical Industry Co., Ltd.
6,427,205.13 0.65
in Xiangzhou District, Zhuhai
Shenzhen University 901,504.27 0.09
Total 968,581,873.92 97.81
- 87 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
5. Investment income
(1) Detail of investment income
Unit: RMB Yuan
Item Amount incurred in Amount incurred in
this year last year
Long-term investment income checked by cost method 127,836,922.04 -
Long-term investment income checked by equity method (90,201,890.81) (49,082,776.11)
Investment income from the disposal of long-term
113,531,216.51 (47,678.00)
investment equity
In total 151,166,247.74 (49,130,454.11)
(2) Long-term investment income checked by cost method
Unit: RMB Yuan
Amount
Amount incurred incurred in Reason of increased/decreased fluctuation
Invested unit in this year last year comparing with last year
Weimei Electric The subsidiary allocates dividend this year
71,571,959.87 -
Power company while no allocation last year.
Engineering company The subsidiary allocates dividend this year
56,264,962.17 -
while no allocation last year.
Total 127,836,922.04 -
(3) Long-term investment income checked by equity method
Unit: RMB Yuan
Amount
Amount incurred incurred in last Reason of increased/decreased fluctuation
Invested unit in this year year comparing with last year
Jiangxi Xinchang Referring to Note ( V) 37
(90,201,890.81) (49,082,776.11)
Company
There is no great limitation on the return of investment income.
- 88 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
6. Updates of cash flow statement
(1) Updates of cash flow statement
Unit: RMB Yuan
Amount of this Amount of last
Updates
year year
1． Net profit is adjusted to be cash flow for operating
business
Net profit 185,763,215.13 (92,683,444.17)
Increase: preparation of asset devaluation 16,041,488.47 12,092,537.18
Depreciation of fixed asset 72,292,401.99 50,430,765.04
Amortization of intangible asset 1,399,802.89 1,362,361.36
Amortization of long-term deferred expanses 75,783.60 113,200.92
Loss( profit) through disposing fixed asset, intangible asset
4,609,078.93 -
and other long-term asset
Financial expense( profit) 149,697,744.85 99,981,483.72
Loss( Profit) of investment (151,166,247.74) 49,130,454.11
Decrease( increase) of deferred income tax asset - 16,949,151.06
Decrease ( increase ) of stock 43,401,627.44 22,760,110.30
Decrease ( increase ) of operating items receivable (427,014,813.17) (211,190,292.78)
Increase (decrease) of operating items payable 454,256,195.79 58,721,834.02
Net amount of cash flow incurred in operating activity 349,356,278.18 7,668,160.76
2． Great investment and financing activity that are not
involved in cash balance
Conversion of debt into capital - -
Changeable company debenture share due in one year - -
Financing to rent in fix assets - -
3． Net fluctuation of cash and money equivalent
Year-end remaining of cash and money equivalent 303,150,447.89 269,369,131.18
Decrease: Remaining in the beginning of year of cash and money
269,369,131.18 35,564,935.05
equivalent
Net increasing amount of cash and cash equivalent 33,781,316.71 233,804,196.13
(2) Constitution of cash and money equivalent
Unit: RMB Yuan
Amount at the end Amount in the
Item of the year beginning of the
year
I. Cash 303,150,447.89 269,369,131.18
There into: value-cash 73,554.85 48,656.09
Bank deposits used to pay at any time 302,539,423.53 268,895,495.56
Other currency fund used to pay at any time 537,469.51 424,979.53
II. Year-end remaining of cash and money equivalent 303,150,447.89 269,369,131.18
- 89 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction
(1)Purchase and sale of goods, provision and acceptance of labor service
Goods purchase and service acceptance table:
Unit: RMB Yuan
Amount incurred in the current
year Amount incurred in last year
The
proportion in
Pricing method and The proportion the amount
Related decision-making in the amount of of similar
transaction process of related Amount of similar Amount of transaction
Related party content transaction money transaction (%) money (%)
According to price
Xiefu Oil Supply released by competent
Fuel purchase - - 9,560,336.80 0.77
Company department of refer to
market price
According to price
Warehousing
Xiefu Oil Supply released by competent
and transport 6,449,632.14 100.00 12,102,818.98 100.00
Company department of refer to
cost
market price
According to price
New electric released by competent 398,021,462.6
Fuel purchase 22.95 211,480,735.73 16.95
power company department of refer to 0
market price
According to price
Mawan Electric Charge for using released by competent
- - 181,955.27 100.00
Power Company oil pipelines department of refer to
market price
According to price
Mawan Electric released by competent
Fuel purchase - - 21,140,652.48 1.69
Power Company department of refer to
market price
According to price
Yue Liangwan Charge for using released by competent
- - 877,857.45 100.00
Oil Company wharf department of refer to
market price
According to price
Zhongshan
released by competent
Electric Power Fuel purchase - - 17,499,373.95 1.40
department of refer to
Company
market price
Goods sale and service provision table:
Unit:RMB Yuan
Amount incurred in current
year Amount incurred in last year
The The
proportion in proportion in
the amount the amount
Related Pricing method and of similar of similar
transaction decision-making process Amount of transaction Amount of transaction
Related party content of related transaction money (%) money (%)
According to price
New electric Charge for
released by competent
power using flue 2,333,308.80 100.00 2,699,107.20 100.00
department of refer to
company gas
market price
Service charge According to price released by
New electric for unit competent department of refer
16,335,171.00 100.00 29,557,385.50 100.00
power company operating to market price
trusteeship
According to price released by
New electric Heating power
competent department of refer 3,917,820.44 63.40 72,825.19 0.02
power company sale
to market price
Zhongshan According to price released by
Electric Power Materials sale competent department of refer - - 5,528,376.07 1.29
Company to market price
According to price released by
Weimei Electric
Materials sale competent department of refer 8,604,673.29 9.92 2,407,094.01 0.56
Power Company
to market price
- 90 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
According to price released by
Weimei Electric Leasing
competent department of refer 431,765.02 0.50 907,197.48 0.21
Power Company materials
to market price
Environmental According to price released by
protection Hot-water sale competent department of refer 6,547,254.72 7.55 - -
company to market price
Environmental According to price released by
Cooling water
protection competent department of refer 2,379,392.46 2.74 - -
sale
company to market price
Environmental According to price released by
protection Leasing land competent department of refer 1,152,000.00 1.33 - -
company to market price
According to price released by
competent department of refer
Environmental to market price
protection Tap-water sale 26,650.00 0.03 - -
company
- 91 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction-Continued
(2)Situation of related trusteeship
Trusteeship situation table:
Unit: RMB Yuan
The name
The name of of the The end date
entrusting entrusted Transaction Situation of the Starting date of of being Pricing basis of trusteeship Amount of
party party types entrusted asset being entrusted entrusted income money
Calculating and determined
New electric Generators of
This Trusteeship November 31, by 0.025 Yuan/KWH 16,335,17
power number II, X January 1, 2011
company income 2011 according to generating 1.00
company and XI
capacity
Calculating and determined
New electric Generators of
This Trusteeship November 31, by 0.025 Yuan/KWH 29,557,38
power number II, X January 1, 2010
company income 2010 according to generating 5.50
company and XI
capacity
Apportionment according to
New electric Cost Generators of
This November 31, the capacity of the unit of 4,430,043.
power apportionments number II, X January 1, 2011
company 2011 the new electric power 28
company (note) and XI
company
Apportionment according to
New electric Cost Generators of
This November 31, the capacity of the unit of 9,664,570.
power apportionments number II, X January 1, 2010
company 2010 the new electric power 61
company (note) and XI
company
Apportionment according to
New electric expense Generators of
This November 31, the capacity of the unit of 17,476,97
power allocation(note number II, X January 1, 2011
company 2011 the new electric power 7.77
company ) and XI
company
Apportionment according to
New electric expense Generators of
This November 31, the capacity of the unit of 36,427,94
power allocation(note number II, X January 1, 2010
company 2010 the new electric power 3.27
company ) and XI
company
Note：According to Trusteeship Operating Contact of Generator Unit Asset of Shenzhen New Electric Power
Industry Co., LTD signed by this company and New Electric Company on December 23, 2003, operation
and management of 2#, 10# and 11# unit assets are all entrusted to this company. The content of entrusting
operation includes: production plan, power generation dispatching, power measure and sale by proxy,
collection of electricity and management of safe running of the equipment, etc., and works of purchasing,
storage and management of consumption materials and necessary parts of repair and maintain, daily
maintenance of power generation equipment and facilities, eliminating, he management and quality control
of large and medium-sized repair engineering, and technological innovation and transformation of power
generation equipments, etc.
For fuel used for power generation, after being purchased by New Electric Power Company, should be
submitted to the company for using as a whole, and list the cost according to actual fuel consuming amount
of the unit owned by New Electric Power Company.
For big repairing bills and prepared equipments, they should be purchased united by the company
according to trusteeship contact, and will belong to cost of relevant unit and be calculated into unit cost of
New Power Company in actual process.
For expense that can’t be calculated into expense of New Power Company unit ( e.g. water and electricity
expense, common asset depreciation and personnel salaries, etc.), should be divided to be shared by New
Power Company and this company according to proportion of amount of power generated.
This company and New Electric Power Company declare paying taxes according to the above sharing
method.
- 92 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction-Continued
(3)Related assurance situation
Offering assurance
Unit: RMB Yuan
Completing of the
Assurance Amount of Starting date of End date of
Secured party performance of
provider assurance assurance assurance
assurance
This Weimei Electric
100,000,000.00 2011.12.06 2012.06.06 No
company Power Company
This Weimei Electric
10,000,000.00 2011.02.14 2012.02.12 No
company Power Company
This Weimei Electric
90,000,000.00 2011.02.22 2012.02.12 No
company Power Company
This Weimei Electric
100,000,000.00 2011.12.02 2012.07.20 No
company Power Company
This Weimei Electric
100,000,000.00 2011.12.07 2012.07.20 No
company Power Company
This Weimei Electric
80,000,000.00 2011.07.15 2012.07.15 No
company Power Company
This Weimei Electric
100,000,000.00 2011.12.29 2012.12.29 No
company Power Company
This Weimei Electric
20,000,000.00 2011.01.10 2012.01.10 No
company Power Company
Zhongshan
This
Electric Power 50,000,000.00 2011.09.09 2012.09.09 No
company
Company
Zhongshan
This
Electric Power 50,000,000.00 2010.04.01 2012.04.01 No
company
Company
Zhongshan
This
Electric Power 90,000,000.00 2011.01.21 2012.01.21 No
company
Company
Environmental
This
protection 10,000,000.00 2011.08.03 2012.08.03 No
company
company
Environmental
This
protection 26,000,000.00 2009.11.06 2017.09.20 No
company
company
Environmental
This
protection 10,000,000.00 2011.07.22 2012.06.20 No
company
company
This New Electric
30,000,000.00 2011.06.30 2012.06.30 No
company Power Company
This New Electric
30,000,000.00 2011.07.06 2012.07.06 No
company Power Company
This New Electric
30,000,000.00 2011.08.25 2012.08.25 No
company Power Company
This New Electric
10,000,000.00 2011.09.02 2012.09.02 No
company Power Company
This New Electric
100,000,000.00 2011.12.22 2012.12.22 No
company Power Company
- 93 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
This New Electric
100,000,000.00 2011.12.29 2012.12.29 No
company Power Company
This New Electric
50,000,000.00 2011.10.27 2012.10.27 No
company Power Company
This Weimei Electric
40,000,000.00 2010.04.15 2011.02.03 Yes
company Power Company
This Weimei Electric
27,000,000.00 2010.04.20 2011.02.03 Yes
company Power Company
This Weimei Electric
40,000,000.00 2010.05.19 2011.02.03 Yes
company Power Company
This Weimei Electric
25,000,000.00 2010.06.04 2011.02.03 Yes
company Power Company
This Weimei Electric
22,000,000.00 2010.06.21 2011.02.03 Yes
company Power Company
This Weimei Electric
40,000,000.00 2010.06.24 2011.02.03 Yes
company Power Company
This Weimei Electric
40,000,000.00 2010.07.09 2011.02.03 Yes
company Power Company
This Weimei Electric
22,000,000.00 2010.07.15 2011.02.03 Yes
company Power Company
This Weimei Electric
44,000,000.00 2010.07.28 2011.02.03 Yes
company Power Company
This Weimei Electric
80,000,000.00 2010.04.01 2011.04.01 Yes
company Power Company
This Weimei Electric
100,000,000.00 2010.12.29 2011.12.29 Yes
company Power Company
This Weimei Electric
60,000,000.00 2010.02.01 2011.07.29 Yes
company Power Company
This Weimei Electric
40,000,000.00 2010.04.01 2011.07.29 Yes
company Power Company
Zhongshan
This
Electric Power 50,000,000.00 2009.09.01 2011.09.01 Yes
company
Company
Zhongshan
This
Electric Power 25,000,000.00 2010.08.26 2011.08.26 Yes
company
Company
Zhongshan
This
Electric Power 40,000,000.00 2010.09.20 2011.09.20 Yes
company
Company
Zhongshan
This
Electric Power 35,000,000.00 2010.09.26 2011.09.26 Yes
company
Company
Zhongshan
This
Electric Power 5,000,000.00 2010.10.28 2011.10.28 Yes
company
Company
Zhongshan
This
Electric Power 35,000,000.00 2010.11.05 2011.11.05 Yes
company
Company
Environmental
This
protection 30,000,000.00 2010.03.30 2011.03.30 Yes
company
company
- 94 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction-Continued
(4) Financial inter-bank lending of the related party
The present year：
Unit: RMB
Inter-bank
Related party Starting date Due date Ending balance Illustrations
lending amount
Borrowed
Engineering
20,000,000.00 2011.08.25 2012.08.25 20,000,000.00
company
Engineering
60,000,000.00 2011.11.21 2012.11.21 60,000,000.00
company
Engineering Borrowed fund from related party
60,000,000.00 2009.11.20 2011.11.17 -
company through banks
Xiefu Oil
Supply 15,000,000.00 2011.08.30 2012.08.29 15,000,000.00
Company
Xiefu Oil
Supply 10,000,000.00 2011.07.18 2012.07.17 10,000,000.00
Company
Weimei Electric
30,000,000.00 2011.11.01 2012.11.01 30,000,000.00
Power Company
Weimei Electric
100,000,000.00 2011.10.14 2012.10.14 100,000,000.00
Power Company
New electric
130,000,000.00 2011.12.07 2012.12.07 130,000,000.00
power company
Shenzhong
Development 40,000,000.00 2011.09.16 2012.09.16 40,000,000.00
Company
Open out
Shenzhong Exhibition period
Development 70,040,000.00 2011.01.01 2011.12.31 70,040,000.00
Company
Shenzhong Exhibition period
Developemt 48,750,000.00 2011.01.01 2011.12.31 48,750,000.00
Company
Shenzhong Exhibition period
Developemt 7,500,000.00 2011.01.01 2011.12.31 7,500,000.00
Company
Shenzhong Exhibition period
Developemt 375,950,450.55 2011.01.01 2011.12.31 375,950,450.55
Company
Shenzhong Exhibition period
Developemt 43,005,307.50 2011.01.01 2011.12.31 43,005,307.50
Company
Shenzhong Exhibition period
Developemt 46,280,000.00 2011.01.01 2011.12.31 46,280,000.00
Company
Weimei Electric
71,571,959.87 2011.07.15 2013.07.15 71,571,959.87
Power Company
Weimei Electric Loan issued to related party by
63,080,000.00 2010.07.26 2011.03.28 -
Power Company entrusting bank
Zhongshan
Loan issued to related party by
Electric Power 25,000,000.00 2011.03.02 2012.03.02 25,000,000.00
entrusting bank
Company
Zhongshan
Exhibition period of loan issued to
Electric Power 180,000,000.00 2010.04.14 2012.04.14 180,000,000.00
related party by entrusting bank
Company
Zhongshan Loan issued to related party by
Electric Power 24,923,940.43 2009.12.24 2010.12.24 - entrusting bank has been taken
Company back on January 17, 2011
- 95 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Zhongshan Loan issued to related party by
Electric Power 100,000,000.00 2011.01.18 2011.02.28 - entrusting bank has been taken
Company back on March 28, 2011
Zhongshan Loan issued to related party by
Electric Power 50,000,000.00 2010.06.12 2011.06.12 - entrusting bank has been taken
Company back on June 09, 2011 in advance
Zhongshan
Loan issued to related party by
Electric Power 40,000,000.00 2010.09.20 2011.09.20 -
entrusting bank
Company
Zhongshan Loan issued to related party by
Electric Power 35,000,000.00 2010.09.28 2011.09.28 - entrusting bank has been taken
Company back on September 10, 2011
Zhongshan
Electric Power 50,000,000.00 2010.04.01 2011.12.31 50,000,000.00 Exhibition period
Company
Zhongshan
Electric Power 40,437,227.87 2010.04.01 2011.12.31 40,437,227.87 Exhibition period
Company
Zhongshan
Electric Power 28,000,000.00 2010.04.01 2011.12.31 28,000,000.00 Exhibition period
Company
Zhongshan
Electric Power 19,623,969.20 2010.04.01 2011.12.31 19,623,969.20 Exhibition period
Company
Zhongshan
Electric Power 50,000,000.00 2011.04.25 2012.04.25 50,000,000.00
Company
Zhongshan
Electric Power 40,000,000.00 2011.06.02 2012.06.02 40,000,000.00
Company
Zhongshan
Electric Power 50,000,000.00 2011.06.10 2012.06.10 50,000,000.00
Company
Zhongshan
Electric Power 60,000,000.00 2011.07.22 2012.07.22 60,000,000.00
Company
Zhongshan
Electric Power 35,000,000.00 2011.09.08 2012.09.08 35,000,000.00
Company
Zhongshan
Electric Power 50,000,000.00 2011.09.01 2012.09.01 50,000,000.00
Company
Zhongshan
Electric Power 40,000,000.00 2011.09.06 2012.09.06 40,000,000.00
Company
Zhongshan
Electric Power 100,000,000.00 2011.12.20 2012.12.20 100,000,000.00
Company
Environment
Has been taken back on December
protection 10,000,000.00 2011.09.19 2012.09.19 -
29,2011
company
Environment
Has been taken back on December
protection 10,000,000.00 2011.09.23 2012.09.23 -
29,2011
company
- 96 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction-Continued
(4)Inter-bank of funds of related party-Continued
Previous year:
Unit: RMB Yuan
Inter-bank
Starting
Related party lending Due date Ending balance Illustrations
date
amount
Borrowed
Borrowed fund from
Engineering
60,000,000.00 2009.11.20 2011.11.17 60,000,000.00 related party through
company
banks
Open out
Shenzhong Expired, the exhibition
Development 70,040,000.00 2009.10.14 2010.03.31 70,040,000.00 period is still in the
Company process
Shenzhong Expired, the exhibition
Development 48,750,000.00 2009.04.25 2010.03.31 48,750,000.00 period is still in the
Company process
Shenzhong Expired, the exhibition
Development 7,500,000.00 2009.04.05 2010.03.31 7,500,000.00 period is still in the
Company process
Shenzhong Expired, the exhibition
Development 375,950,450.55 2009.11.18 2010.03.31 375,950,450.55 period is still in the
Company process
Shenzhong Expired, the exhibition
Development 43,005,307.50 2009.12.28 2010.03.31 43,005,307.50 period is still in the
Company process
Shenzhong Expired, the exhibition
Development 46,280,000.00 2009.01.01 2009.12.31 46,280,000.00 period is still in the
Company process
Shenzhong
Development 23,000,000.00 2009.05.19 2010.03.31 -
Company
Shenzhong
Development 43,000,000.00 2009.10.09 2010.03.31 -
Company
Shenzhong Has been taken back on
Development 4,875,000.00 2009.08.29 2010.03.31 - January 08, 2010 in
Company advance
Weimei Has been taken back on
Electric Power 10,000,000.00 2008.10.28 2010.03.31 - January 08, 2010 in
Company advance
Weimei
Loan issued to related
Electric Power 140,000,000.00 2009.07.28 2010.01.27 -
party by entrusting bank
Company
Weimei
Loan issued to related
Electric Power 140,000,000.00 2010.01.27 2010.07.27 -
party by entrusting bank
Company
Weimei
Loan issued to related
Electric Power 63,080,000.00 2010.07.26 2011.07.26 63,080,000.00
party by entrusting bank
Company
Weimei 50,000,000.00 2010.07.29 2011.07.29 - Loan issued to related
- 97 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Electric Power party by entrusting bank
Company has been taken back on
November 30, 2010
Zhongshan Expired, the exhibition
Electric Power 50,000,000.00 2009.03.25 2010.03.31 50,000,000.00 period is still in the
Company process
Zhongshan Expired, the exhibition
Electric Power 40,437,227.87 2008.09.26 2010.03.31 40,437,227.87 period is still in the
Company process
Zhongshan Expired, the exhibition
Electric Power 28,000,000.00 2009.01.11 2010.03.31 28,000,000.00 period is still in the
Company process
Zhongshan
Loan issued to related
Electric Power 100,000,000.00 2009.12.24 2010.12.23 24,923,940.43
party by entrusting bank
Company
Zhongshan
Loan issued to related
Electric Power 180,000,000.00 2010.04.14 2011.04.14 180,000,000.00
party by entrusting bank
Company
Zhongshan
Loan issued to related
Electric Power 50,000,000.00 2010.06.12 2011.06.12 50,000,000.00
party by entrusting bank
Company
Zhongshan
Loan issued to related
Electric Power 40,000,000.00 2010.09.20 2011.09.20 40,000,000.00
party by entrusting bank
Company
Zhongshan
Loan issued to related
Electric Power 35,000,000.00 2010.09.28 2011.09.28 35,000,000.00
party by entrusting bank
Company
(5)Reward of key management personnel
Unit: RMB Yuan
Project name
Amount incurred in Amount incurred in
current year last year
Reward of key management personnel 7,311,300.00 7,162,700.00
- 98 -
Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction-Continued
(6)Charge for the use of funds
Unit: RMB Yuan
Amount incurred in current
year Amount incurred in last year
The
Pricing proportion The
Transactio
Related party method and in the proportion in
n type Amount of
Related decision-maki amount of the amount of
money
transacti ng process of similar similar
on related Amount of transaction transaction
content transaction money (%) (%)
Charge for
Engineering the use of Interest
Note 3,065,486.67 2.04 2,270,800.00 2.27
company funds expense
Charge for
Weimei Electric the use of Interest
Note 1,773,022.23 1.18 4,869,834.11 4.87
Power Company funds expense
Charge for
Xiefu Oli Supply the use of Interest
Note 640,511.11 0.43 - -
Company funds expense
Charge for
Zhongshan
the use of Interest
Electric Power Note 37,033,727.95 47.10 21,258,779.30 36.00
funds revenue
Company
Charge for
Shenzhong
the use of Interest
Development Note 35,568,525.18 45.23 31,850,582.38 31.86
funds revenue
Company
Charge for
Weimei Electric the use of Interest
Note 3,501,522.33 4.45 - -
Power Company funds revenue
Charge for
Environment
the use of Interest
Protection Note 364,444.44 0.46 - -
funds revenue
Company
Note：Charge for the use of funds is calculated according to borrowing rate of bank liquidity of the same level
(7)Asset transfer situation of the related party
Unit: RMB Yuan
Pricing Amount incurred in current Amount incurred in last
method and year year
Related
Related decision-maki The proportion The proportion
transaction Amou
party ng process of in the amount of in the amount
content nt of
Transactio related Amount of similar of similar
money
n type transaction money transaction (%) transaction (%)
Transfer 10% of
the equity of
Energy Asset
Energy 123,078,90
Environmental transforma Market price 36.19 - -
Group 0.00
Protection tion
Company held by
this company
(8)Receivables and payables of the related party
Receivables of the related party
Unit: RMB Yuan
Project name Related party Ending balance Beginning balance
Shenzhong Development
Other receivables Company 688,629,880.98 693,061,355.80
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Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
Zhongshan Electric Power
Company 626,243,082.60 181,927,622.99
Weimei Electric Power
Company 85,437,069.99 7,778,446.81
Environment protection
company 11,017,120.27 -
Xiefu Oil Supply Company 6,279,745.17 6,280,847.20
Shennan Sigapore Company 138,660.87 31,072.34
Xing Desheng Company 35,127.06 19,596.65
Dividends receivable New Electric Power Company 597,875,904.41 597,875,904.41
Engineering Company 56,264,962.17 -
Zhongshan Electric Power
Other current assets Company 205,000,000.00 329,923,940.43
Weimei Electric Power
Company - 63,080,000.00
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Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
(XI) Notes on Company’s financial statements -Continued
7. Situation of related transaction-Continued
(7) Receivables and payables of the related party - Continued
Payables of the related party
Unit: RMB Yuan
Project name Related party Ending balance Beginning balance
Advance receipt Energy shares 14,586,000.00 14,586,000.00
Account payables Xiefu Oil Supply Company 332,376.11 849,813.37
New Electric Power
776,413,945.94 470,222,997.74
Other payables Company
Weimei Electric Power
131,773,022.23 -
Company
Engineering Company 81,036,534.88 115,528.80
Xiefu Oil Supply Company 26,364,386.39 1,030,238.37
Xingdesheng Company 1,682,266.99 1,768,797.13
Environment Protection
- 1,129,973.65
Company
Short-term borrowing Engineering Company - 60,000,000.00
XII. Approval of financial statements
Financial statement of the company and combined financial statement are approved by the board of directors of
this company on April 20, 2012.
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Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
1. Detailed statement of the irregular profits and losses
Unit: RMB Yuan
Amount incurred
Project in current year Illustrations
Disposal of profits and losses of non-current asset 113,277,953.88
Recon in the government grants of profits and losses of the current
period(except for government grants that closely related with business
245,208.34
events, and obtained according to national unified standard of ration and
quantify)
receivables impairment that is performed impairment test separately is
1,185,260.28
getting to switch back
Returned money of added tax on imports of natural gas 214,622,872.15
Other non-operating revenues and payments in addition to the above items 4,988,236.41
Amount influenced by income tax (8,532,710.17)
Amount influenced by minority stockholder's interest(after tax) (19,560,956.77)
Total 306,225,864.12
2. Net asset income rate and earnings of per share
Unit: RMB Yuan
Earnings of per share
The weighted average net Basic earnings of Diluted earnings of
Profit of report period assets yield (%) per share per share
Net profit belongs to the common
1.00 0.03 Not applicable
shareholders of the company
Net profit belongs to the common
shareholders of the company after
(16.55) (0.48) Not applicable
deducting irregular profits and
losses
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Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
3. Illustrations of exceptional situations and reasons of main accounting statements project of the company
Unit: RMB Yuan
Amount of
Report item Year 2011 Year 2010
variation Reasons for difference
It is caused by much cash flow given rise by
1 Monetary fund 695,095,052.12 601,386,814.04 15.58%
business activities and investment activities.
Notes receivable in the beginning of the year
res2 Notes receivable - 700,000.00 (100.00%)
are already settled.
It is caused by increase of allowance
3 Accounts receivable 934,640,019.03 518,392,276.69 80.30%
receivable of this year.
It is caused by advance payments of natural
4 advance payments 31,576,397.23 13,529,901.89 133.38%
gas.
It is caused by amounts of equity transfer
Other accounts
5 124,599,842.72 20,450,149.23 509.29% receivable of Xinchang Company in Jiangxi
receivable
Province.
6 Inventory 1,258,195,597.25 1,352,372,212.06 (6.96%) It is caused by disposal of fuel oil in this year.
It is caused by disposal of capital assets for
7 Other current assets - 4,242,431.37 (100.00%)
sale held in the beginning of the year.
It is caused by transformation of equity of
Long term equity
8 37,315,000.00 306,208,274.30 (87.81%) Jiangxi Xinchang Company and Energy
investment
Environment Protection Company in this year.
It is caused by the increase of capital asset of
9 capital assets 2,227,103,579.26 2,169,226,270.73 2.67%
this year.
Construction in It is caused by shifting the sludge drying
10 46,866,969.48 196,729,476.64 (76.18%)
process project to capital asset in this year.
Long term deferred It is caused by the sharing of long term
11 95,810.84 273,212.64 (64.93%)
expenses deferred expenses in the beginning of the year.
Other noncurrent It is caused by increase of advance engineering
12 24,864,716.98 21,273,223.68 16.88%
assets payments and advance land payments.
Short-term
13 3,265,824,953.89 3,112,400,000.00 4.93% It is caused by increase of bank loans.
borrowing
14 Notes payable 43,820,200.00 - 100.00% It is caused by new issued bills of this year.
It is caused by receivable payments of natural
15 Accounts receivable 214,748,889.66 61,115,438.61 251.38%
gas.
It is caused by decrease of advance
16 Advance payments 14,586,000.00 39,274,341.26 (62.86%)
engineering payments of this year.
Staff salaries It is caused by decrease of plan amount of this
17 32,691,674.04 45,432,950.70 (28.04%)
payable year.
It is caused by the increase of amount of the
18 Tax payable (521,900,793.90) (501,193,418.09) 4.13%
debit side of payable value added tax .
It is caused by the increase of the base rate of
19 Interest payable 75,462,594.51 59,348,039.27 27.15%
bank loan.
Other amounts It is caused by the increase of payable
20 358,597,380.00 288,768,647.34 24.18%
payable engineering payments.
Long-term It is caused by decrease of long-term
21 26,000,000.00 186,000,000.00 (86.02%)
borrowing borrowing in this year.
Undistributed It is caused by the increase of net profit in this
22 454,070,630.72 436,541,567.35 4.02%
profits year.
minority
It is caused by the decrease of net profit of
23 stockholder's 134,439,441.22 196,615,862.35 (31.62%)
non-wholly owned subsidiary company.
interest
It is caused by revenue increase in power sales,
24 Operation revenue 2,415,817,730.35 1,601,730,465.30 50.83%
fuel sales, equipment sales and sludge drying.
It is caused by the cost decrease in power sales,
25 Operating costs 3,589,704,382.71 2,239,345,909.35 60.30%
fuel sales, equipment sales and sludge drying.
Sales tax and extra It is caused by the increase of city maintenance
26 12,574,988.91 7,363,142.54 70.78%
charges and construction tax and others of this year.
It is caused by the increase of interest expense
27 Financial expense 204,297,949.90 128,297,803.98 59.24%
of this year.
28 Loss from asset 23,521,935.10 11,194,836.04 110.11% It is caused by the increase of plan amount of
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Shenzhen Nanshan Power Co., Ltd.
Annotations of Financial Statements
Year to December 31, 2011
devaluation inventory revaluation reserve and impairment
of fixed assets
It is caused by transformation of equity of
29 Investment income 23,329,325.70 (49,130,454.11) 147.48% Jiangxi Xinchang Company and Energy
Environment Protection Company in this year.
It is caused by the increase of fuel subsidies
Non-business
30 1,516,790,851.26 832,316,848.06 82.17% income and returned amount of value added
income
tax on natural gas import of this year.
Non-business It is caused by the increase of abandonment
31 5,225,709.23 573,905.21 810.55%
expenditure loss of capital asset in this year.
It is caused by the decrease returning of
32 Income tax expense 13,224,142.33 24,787,762.05 (46.51%)
deferred income tax assets of this year.
Net profit belongs to
33 the shareholders of 17,529,063.37 (114,638,678.20) 115.29% It is caused by net earnings of this year.
the parent company
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