重庆建设摩托车股份有限公司
CHONGQING JIANSHE MOTORCYCLE CO.,LTD.
Interim Report 2010 (Full Version)
Important Statement: The Board of Directors and the directors of the Company guarantee that there are no significant
omissions, fictitious or misleading statements carried in the Report and we will accept individual and joint responsibilities
for the truthfulness, accuracy and completeness of the Report.
Mr. Li Huaguang, the Legal Representative of the Company, Mr. Teng Feng, the Financial Officer, Mr. Cheng Fukai, the
manager of accounting department, hereby declare: the truthfulness and completeness of the Financial Report are
guaranteed.
Li Huaguang - Chairman of the Board
Table of Contents
I. COMPANY PROFILE.............................................................................................................................................２
II. MAJOR FINANCIAL INFORMATION .....................................................................................................................３
III. MOVEMENT OF CAPITAL SHARE AND TOP TEN SHAREHOLDERS...........................................................４
IV. PARTICULARS ABOUT THE DIRECTORS, SUPERVISORS AND SENIOR EXECUTIVES .........................５
V. REPORT OF THE BOARD..........................................................................................................................................５
VI. SIGNIFICANT EVENTS............................................................................................................................................８
VII. FINANCIAL REPORT (NOT AUDITED)............................................................................................................１１
VIII. DOCUMENTS READY FOR INQUIRING ...........................................................................................................56建设摩托 Interim Report 2010
２
I. Company Profile
(I) Statutory Chinese name: 重庆建设摩托车股份有限公司（缩写：建设摩托）
Statutory English name: CHONGQING JIANSHE MOTORCYCLE CO.,LTD. (Abbr. JSMC-B)
(II) Stock listed in: Shenzhen Stock Exchange
Abbreviation of the stock: Jianmo B
Stock code: 200054
(III) Registered address: No.1 Jianshe Road, Huaxi Industrial Zone, Banan District, Chongqing
Office address: No.1 Jianshe Road, Huaxi Industrial Zone, Banan District, Chongqing
Post Code: 400054
Official Website: http://www.jianshe.com.cn
Official Email: cqjsmc@jianshe.com.cn
(IV) Legal representative: Li Huaguang
(V) Secreatary of the Board: Wu Dadong
Contact address: No.1 Jianshe Road, Huaxi Industrial Zone, Banan District, Chongqing
Tel/Fax: (023)66295333
Email: cqjsmc@jianshe.com.cn
(VI) Information disclosure media:
Website: http://www.cninfo.com.cn
Press media: Securities Times, Hong Kong Commercial Daily
Place where the reports and announcement are ready for inquiry:: Office of the Board of the Company
(VII) Misc. Information
Primary registration date: July 19th, 1995
Registration modified on: January 20, 2009
Primary registration place: Shenzhen Industry & Commerce Administrative Bureau
Secondary registration place: Chongqing Industry & Commerce Administrative Bureau
Business license No. 5000001805583
Taxation registration No. National: 500107747482423
Local: 500107747482423建设摩托 Interim Report 2010
３
II. Major Financial Information
(I) Financial highlights of the report term and at the end of last year
RMB0’000
Items Ended this report
term
Ended previous
year
Increase/decrease over the beginning of year
(%)
Gross Assets 397,583 347,626 14.37
Shareholders’ equity 48,173 46,107 4.48
Net asset per share (RMB) 1.01 0.97 4.60
Current term
(Jan-Jun)
Same period last
year
Increase/decrease over same period of last
year(%)
Operation profit 1,128 79 -1,327.85
Total profit 1,321 1,283 2.96
Net profit 1,339 1,119 19.66
Net profit deducted non-recurring
gain/loss
1,146 -85 1,448.24
Basic earnings per share (RMB) 0.028 0.023 19.48
Diluted earnings per share (RMB) 0.028 0.023 19.48
Net earnings / capital ratio (%) 2.84 2.46 0.38
Cash flow generated by business
operation, net
-12,363 2,988 -513.76
Net Cash flow per share generated
by business operation (RMB)
-0.26 0.06 -515.50
Note: Non-recurring gain/loss items are: non-business income RMB2.22 million, non-business expenses RMB290
thousand.
(II) There was no difference between the net profit figures generated under Chinese accounting standard and
international accounting standard建设摩托 Interim Report 2010
４
III. Movement of Capital Share and Top Ten Shareholders
(I) None of the total number of shares and share structure were changed in the report term
(II) Top Ten Shareholders and Top Ten Negotiable Share Holders
Total shareholders at the end of the report period 16,421
Top Ten Shareholders
Full name of the
shareholder
Changed in
the report
term (shares)
Shares held at the end
of term (shares)
Proportion
%
Class of share Pledged or
frozen
Properties of
shareholder
(State-owned or
foreign investors)
China Southern Industry
Group Co., Ltd.
0 339,625,000 71.13 Non-negotiable 0 State-owned
Gu Zuocheng 0 8,875,000 1.86 Non-negotiable 0 State-owned
Yangpu Xinyufeng
Investment Co., Ltd.
0 7,000,000 1.46 Non-negotiable 0 State-owned
Feng Yonghui 0 2,000,000 0.42 Non-negotiable 0 State-owned
PRO PERFORMANCE 610,000 610,000 0.13 Negotiable 0 Foreign shares
Cai Yugui -11,400 517,000 0.11 Negotiable 0 Foreign shares
Peng Daqiang 27,600 450,849 0.09 Negotiable 0 Foreign shares
Shanghai Hong Kong
Wanguo Securities
-350,099 425,901 0.09 Negotiable 0 Foreign shares
Zhang Shaoqin 0 420,800 0.09 Negotiable 0 Foreign shares
Li Yunwei -90,000 407,256 0.09 Negotiable 0 Foreign shares
Top Ten Shareholders of Negotiable Shares
Full name of the shareholder Negotiable shares held at the end
of term (shares)
Share categories (A, B, H or others)
PRO PERFORMANCE 610,000 Current B shares
Cai Yugui 517,000 Current B shares
Peng Daqiang 450,849 Current B shares
Shanghai Hong Kong Wanguo Securities 425,901 Current B shares
Zhang Shaoqin 420,800 Current B shares
Li Yunwei 407,256 Current B shares
Wang Huansheng 394,300 Current B shares
GUOTAI JUNAN SECURITIES(HONGKONG)
LIMITED
383,900 Current B shares
Liu Xingzhong 383,000 Current B shares
Xu Shaolin 347,900 Current B shares
Notes to relationship or “action in concert” among the
top ten shareholders.
There isn’t any associated relationship between the promoters of the Company.
None of them are regarded as Acting in Concerts in accordance with ‘The rules
of information disclosure on change of shareholding.’It is unknown if there is
any associated relationship between the promoters of the Company. None of
them are known as ‘Acting in concerts’ in accordance with ‘The rules of
information disclosure on change of shareholding.’建设摩托 Interim Report 2010
５
IV. Particulars about the Directors, Supervisors and Senior Executives
(I) None of the directors, supervisors or executives was altered in the report term.
(II) None of the directors, supervisors or management is holding the Company’s shares.
V. Report of the Board
(I) Financial indices and analyzing
In the first half of this year, the Company has successfully released 13 new National-III models as well as the Western
Power Version YBF139. R&D completeness rate increased from 70% to 95%. Professional consultants were introduced to
promote fine production management. QDCM management system was carried out more strictly to build an integrated
and optimized supplier system. Greater effort was used to explore new market and maintain the current market.
In the first half of 2010, the Company realized motorcycle sales of 865000 units, which was 17.70% of increase over than
the same period of last year. In which 315000 were sold by the headquarter, which was a 16.94% of increase than the
same period of last year. According to the statistics by the Auto Industry Association, the Company was taking 6% of the
whole market and ranged the 5th in the first half of this year. The sales of auto A/C compressor was 724800 units, a
56.38% of increase over the same period of last year, and hold the 2nd position of the industry.
Financial situation and business performance
RMB0’000
Items Jan-Jun 2010 Jan-Jun 2009 Changed by (%) Cause of change
Turnover 128,532 112,395 14.36 Note 1
Operation profit 1,128 79 1,327.85 Note 2
Net profit 1,339 1,119 19.66
Note 1: Increase of operation turnover was caused by increase of motorcycle export and auto A/C compressor sales.
Note 2: Increase of operation profit was caused by increase of investment gains from the joint ventures in the report term.
(II) Major business range and operation position
The Company is mainly devoted in manufacturing and technical service of motorcycles, electronic bikes, auto parts,
accessories, and machinery products; designing, manufacturing, and service of industrial modules (except for national
special items); R&D, production, and sales of motorcycle engines; R&D and manufacturing of electro-mechanical
products, home appliances, bicycles, environmental protection products; import, wholesale, retail, and agency (exclude
auction) of the above products (except for special items recognized by the authority).
1. Industrial segment RMB0’000
On industries Turnover Operation cost Gross profit ratio %
Industry 127,639 109,322 14.35建设摩托 Interim Report 2010
６
Products account for over 10% of the major business income RMB0’000
Major products Product
turnover
Product
cost
Gross profit ratio
%
Account in main business income
(%)
Motorcycle and parts 96,860 84,259 13.01 86.97
Compressor for vehicle air
conditioner
30,779 25,063 18.57 27.64
2. Geographic segment RMB0’000
Geographic segments Main business turnover Main business cost Main business gross profit
North China 12,770 11,070 13.31
East China 11,311 10,075 10.93
Mid-South China 9,541 8,778 8.00
South-west China 57,648 45,157 21.67
North-east China 3,257 3,009 7.61
North-west China 6,594 6,090 7.64
South China 5,381 4,886 9.20
Subtotal of domestic sales 106,502 89,065 16.37
Overseas sales 21,137 20,257 4.16
Total 127,639 109,322 14.35
3. None of the profit structure, main business or its structure, and main business profitability has changed significantly.
4. Other business operation which made great influence on the profitability in the report term RMB0’000
Other business operation Gain/loss Portion in net profit (%)
Rent of fixed assets 357 27.55
5. Business operation of the holding companies and joint ventures RMB0’000
Name of companies Shares
held
Registered
capital
RMB0’000
Capital scale
RMB0’000
Major products or service Net profit
(RMB0’000)
Chongqing Jianshe
YAMAHA Motorcycle Co.,
Ltd.
50.00%
37,993
128,419 Manufacturing and sales of
motorcycles and engine parts
4,130
Zhuzhou Jianshe YAMAHA
Motorcycle Co., Ltd.
50.00%
49,786
73,457 Manufacturing and sales of
motorcycles and engine parts
3,475
Chongqing Pingshan Taikai
Carburetor Co., Ltd.
49.00%
15,876
15,992 Manufacturing and sales of
carburetors, general gas engines and
parts
354
6. Difficulties encountered in business operation建设摩托 Interim Report 2010
７
First we need to further enhance our marketing force. We still have gap with the joint-ventures in the industry in terms of
marketing force. However we have great space to improve in sales channel, market reputation, and after-sales services.
Secondly we need to keep adjust our product lines. Product adjustment has shown its effect. Though we still need to
resolve the problems in enhancing the sales of main products and optimizing of product layout. Creativity and production
platform construction are also the facts to be reinforced.
Thirdly we need to further enlarge our productivity. After the move, the production hardware has been greatly improved,
but the cost, production schedule, supply management, and quality management still have space to improve.
(III) Investment in the Report Term
1. In the report term, no capital was newly introduced by financing, nor using of proceeds from previous financing
activities.
2. For investment by non-financial capital in the report term please see “Related Transactions” under “Significant Events”
in this report.
(IV) In the report term, the Company had made no modification on the Company’s annual business plan.建设摩托 Interim Report 2010
８
VI. Significant Events
(I) Company Administration
In the first half of year, the Company enhanced the training programs for the directors, supervisors and executives, further
improved the overall supervising system and fundamental administration rules, promoted risk control and internal
management reforming. Followings are the details:
1. To fully use the supervisory functions of the CPA and information disclosure, standardize the CPA engaging
procedures, and as required by CSRC, the Company produced the ‘CPA engagement regulations”.
2. To further improve the Company’s administration structure, regulate the information disclosure, prevent information
leaking and undercover trade, and protect the Company’s interest, the Company produced the ‘Information insider
administration regulations’ according to the ‘Information disclosure administration rules’, and ‘Shenzhen Stock Exchange
Listing Rules’.
3. In view of improve the Company’s standard operation, ensure the truthfulness, accuracy, completeness, timely, and
fair information disclosure, the Company produced the Responsibility Investigation Regulations on Major Error in Annual
Report according to ,
(证监会公告[2009]34 号), as well as other laws and regulations.
(II) None of profit distribution plan, common reserve capitalizing plan or new share issuing plan was produced
before the report term which need to be carried out in the report term. None of profit distribution or common
reserve capitalizing will be carried out for the report term. Profits will be used to neutralize previous losses.
(III) Major lawsuit and arbitration issues
1. New major lawsuit or arbitration issues happened in the report term.
On June 10, 2010, Chongqing Jianshe Sales Co., Ltd. sued to Chongqing Jiulongpo People’s Court against Tangshan
High-tech Development Zone Jinhui Motorcycle Shop, claiming for RMB182000 of outstanding payment and interests.
The Court accepted the case on June 13, 2010. The 1st trial has not opened yet.
2. material lawsuit or arbitration in the report period.
Jiang Fuqiang and Chongqing Qianhua Machinery Co., Ltd. sued to the 1st middle court of Chongqing on December 17,
2009 claiming for recognition of motorcycle cargo trestle manufactured and sold by Congqing Jianshe Sales Co., Ltd. and
Chongqing Feida Surface Processing Center Ltd. to be one of the protected patents of the claimer. They claimed to stop
manufacturing and sales of the subject and RMB500 thousand of compensation, and the lawsuit fees. During the trial
period, Chongqing Feida Surface Processing Center Ltd. claimed for invalid patent to the Reviewing Committee of
National Committee of Patents. Therefore the 1st Middle Court of Chongqing suspended the trial and waiting for the
reviewing result.
3. Major lawsuit or arbitration issues closed in the report term
On January 5, 2009, Chongqing Northern Jianshe Import & Export Co., Ltd. appealed to Chongqing Jiulongpo People’s
Court against Chongqing Huiyao Motorcycle Co., Ltd. for returning of trade account of RMB3.3 million, and L/C credit
interest of RMB75 thousand, and relative interest losses (basing on RMB3.375 million, at the bank loan interest rate at the
same period since August 16, 2007 till the account was cleared). On May 20, 2009, the court opened trial on this case and
judged in favor of the Import & Export Co. The defender appealed to No.5 Middle Court. However the defender failed to
pay the suing fee timely, and it was treated as retrieved. Thus the first judgment is taking effect and is in execution
procedure up to now.建设摩托 Interim Report 2010
９
(IV) Other PLCs’ shares held by the Company at the end of report term (RMB0’000)
Stock
Code Stock ID Initial
investment
Share
portion
Book value at the
end of term
Gain/loss of the
report term
Change of owners’ equity in
the report term
000536 Min
Mindong 81 0.23% 520 0.00 -31
Total 81 0.23% 520 0.00 -31
Up to the end of report term, the Company hasn’t participated in any investment in financial institutions such as
commercial banks, securities companies, insurance companies, trust companies, or future companies, or participated in
any company whose shares are going to be placed to the stock market.
(V) The Company conducted no major acquisition, selling, or merger operations in the report term.
(VI) Related transactions
1. For details of related transactions please go to the financial report.
2. No credit or debt involved with related parties.
3. Other material related transactions
At the 17th meeting of the 5th term of Board held on May 25, 2010, the “Proposal on establishing Chongqing Southern
Motorcycle Technology Development Co., Ltd.” was approved. This is involving with related transactions, thus the
related directors waived from the voting process of this proposal. The proposal is summarized as the following. (For
details please see the Announcement of Resolutions of the Board released by Securities Times, Hong Kong Commercial
Daily, dated May 26, 2010, and http://www.cninfo.com.cn. )
For the purpose of further enhancing the Company’s R&D capabilities and upgrading the product lines, the Company has
participated in the corporation of Chongqing Southern Motorcycle Technology Development Co., Ltd.(the “Technology
Development Co.” hereafter) along with some other enterprises. The company was registered with capital of RMB120
million. Among which, China Southern Industrial Group Co., Ltd. invested RMB40 million to hold 33.32% of shares; the
Company invested RMB20 million to hold 16.67% of shares; China Jialin Industrial Co., Ltd. invested RMB20 million to
hold 16.67%; Jinan Qingqi Motorcycle Co., Ltd. invested RMB20 million to hold 16.67%; and Luoyang Northern
Enterprise Group Co., Ltd. invested RMB20 million to hold 16.67% of shares respectively. The new company is mainly
devoted in technical research, technology transferring, and consulting services regarding motorcycles, outboard engines,
motor ski, mini motors, conventional machinery, and parts.
(VII) Material Contracts and Implementation
1.No events concerning trusteeship, contracting or lease of assets in which the Company was involved
2. Guarantee issues
As of the end of report term, the Company has provided guarantee to Chongqing Jianshe Vehicle Air Conditioner
Compressor Co., Ltd. – one of the fully-owned subsidiaries for loan of RMB150 million and accepted bank draft of
RMB50 million; and provided guarantee on accepted bank draft of RMB120 million for Chongqing Jianshe Sales Co., Ltd.
– one of the fully-owned subsidiaries. The above guarantees accounted for 69.04% of the net asset provided by the latest
auditing report. They were approved by the Shareholders’ Annual Meeting 2009.
3. No providing or accepting of cash asset management to or from other parties occurred during the report term.
(VIII) No commitment issues involved with shareholders with over 5% of shares in the report term建设摩托 Interim Report 2010
１０
(IX) No correction of major accounting error or retrospective adjustment operation occurred in the report term.
(X) The Interim Financial Report 2009 was not audited.
(XI) Capital adoption and settling in the first half of 2010
As of June 30, 2010, the Company has not involved in any capital adoption by the holding shareholder as described by
[The notice about capital interchange between PLCs and related parties and providing of external guarantee] (证监发
[2003]56 号) issued by CSRC; no payment made on behalf of the holding shareholder regarding wages, welfares,
insurances, or advertisements.
Independent opinions of the independent directors on capital adoption by related parties and providing of external
guarantees:
1. As of June 30, 2010, no capital adopted by the holding shareholder or other related parties.
2. As of the end of report term, the Company has provided RMB320 million of guarantee to the Sales Co. and
Air-conditioner Co. which were the holding subsidiaries of the Company, accounted for 69.04% of the net asset of the
Company as provided by the latest auditing report. Both of these two companies are the fully-owned subsidiaries of the
Company and under full control of the Company. Providing of the guarantees will not impact the interests of the
Company and the shareholders. The Company didn’t provide any guarantee to any of the holding shareholder or the other
related parties or entities the Company was holding less than 50% of the shares. None of the holding shareholder and the
related parties has forced the Company to provide any guarantee to any other parties.
(XII) None of the Company, the Board of Directors, the directors, the shareholders, the executives, or the
substantial controller was under investigation, administrative punishment, criticized, disqualified, restricted by
CSRC or public condemn by stock exchange in the report period.
(XIII) Reception of visiting and investigations
In the report term, on basis of open, fairness, and justice, the Company received the investigation, communication, and
visiting requests from the investors fully pursuant to the provisions of “Guide to Fair Information Disclosure of Listed
Companies” provided by Shenzhen Stock Exchange. No classified important information was disclosed under-table,
ahead of schedule, or to selective objects. The fairness of information disclosure was therefore guaranteed.
Reception Records of Investigations, Communications, and Visiting
Date Location Means Visitors Contents and information referred
2010-6 The
Company
Telephone
communication
Mr. Liu Q: Does the controlling shareholder have any integration plan on
the Company? A: The Company has not been informed by the
controlling shareholder regarding any reorganizing or
integration plan. Please see the Company’s official information
disclosed by the medias assigned by CSRC.建设摩托 Interim Report 2010
１１
VII. Financial Report (Not audited)
Balance Sheet
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. In RMB
Assets Consolidated Parent company
June 30, 2010 December 31, 2009 June 30, 2010 December 31, 2009
Current asset:
Monetary capital 1,630,256,413.29 1,304,441,073.89 783,614,616.69 596,377,236.19
Transactional financial
assets
Notes receivable 49,267,844.52 112,463,525.56 1,930,000.00
200,000.00
Account receivable 263,766,588.32 165,629,837.55 14,198,289.04 128,717.50
Prepayment 180,103,131.07 136,707,134.94 90,713,035.69 112,356,976.84
Interest receivable
Dividend receivable
Other account
receivable 24,218,328.83 37,690,440.26 50,995,163.91 87,669,466.13
Inventories 278,609,532.19 244,192,411.53 65,752,546.95 70,198,837.43
Non-current asset due in 1
year
Other current asset
Total of current asset 2,426,221,838.22 2,001,124,423.73 1,007,203,652.28 866,931,234.09
Non-current assets
Sellable financial asset 5,202,400.00 5,516,000.00
Expired investment in
possess
Long-term receivable
Long-term share
equity investment 643,697,245.17 605,820,126.99 793,244,890.79 755,571,772.61
Investment properties
Fixed assets 725,012,725.60 708,495,035.99 535,744,581.79 510,747,999.42
Construction in process 18,911,847.56 1,867,582.21 18,785,638.06 1,851,993.21
Fixed asset disposal 256,575.55 - 255,555.55 -
Intangible assets 86,841,099.64 88,958,056.00 62,956,369.53 64,801,290.03
R&D expense 43,310,292.07 36,235,410.59 43,310,292.07 36,235,410.59
Goodwill
Long-term amortizable
expenses 13,599,577.57 15,015,927.77 2,645,325.73 3,369,970.97
Differed income tax
asset 10,943,445.28 11,190,840.70 1,501,493.38 1,748,888.80
Other non-current asset 1,836,000.00 2,040,000.00
Total of non-current assets 1,549,611,208.44 1,475,138,980.25 1,458,444,146.90 1,374,327,325.63
Total of assets 3,975,833,046.66 3,476,263,403.98 2,465,647,799.18 2,241,258,559.72建设摩托 Interim Report 2010
１２
Balance Sheet (Cont.)
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. In RMB
Liabilities and shareholders’ Consolidated Parent company
equity June 30, 2010 December 31, 2009 June 30, 2010 December 31,
2009
Current liabilities
Short-term loans 585,200,000.00 582,650,594.68 370,400,000.00 328,000,000.00
Trade off financial liabilities
Notes payable 1,821,710,000.00 1,442,081,176.00 820,840,000.00 630,020,000.00
Account payable 527,324,481.04 512,017,123.12 405,071,996.22 392,821,686.30
Prepayment received 121,786,891.32 180,724,237.99 5,783,592.44 2,997,449.10
Employees’ wage payable 2,253,106.71 3,612,275.56 1,726,861.29 2,674,993.80
Tax payable 118,138,534.97 126,237,465.85 125,915,009.31 131,418,598.90
Interest payable
Dividend payable
Other account payable 88,266,292.10 30,095,591.93 23,125,521.77 135,344,577.06
Non-current liability due in
1 year
Other current liability
Total of current liability 3,264,679,306.14 2,877,418,465.13 1,752,862,981.03 1,623,277,305.16
Non-current liabilities
Long-term borrowings 224,500,000.00 132,500,000.00 164,500,000.00 82,500,000.00
Bond payable
Long-term payable
Special payable 1,992,500.00 1,830,000.00 1,992,500.00 1,830,000.00
Expected liabilities
Differed income tax liability 962,500.00 1,040,900.00
Other non-recurring
liabilities
Total of non-current liabilities 227,455,000.00 135,370,900.00 166,492,500.00 84,330,000.00
Total of liability 3,492,134,306.14 3,012,789,365.13 1,919,355,481.03 1,707,607,305.16
Shareholders’ equity
Capital shares 477,500,000.00 477,500,000.00 477,500,000.00 477,500,000.00
Capital reserves 608,568,017.59 601,303,217.59 603,740,294.29 596,240,294.29
Less: Shares in stock
Surplus reserves 125,686,000.00 125,686,000.00 125,686,000.00 125,686,000.00
Retained profit -730,020,035.69 -743,414,452.61 -660,633,976.14 -665,775,039.73
Total of owner’s equity belong
to the parent company 481,733,981.90 461,074,764.98 546,292,318.15 533,651,254.56
Minor shareholders’ equity 1,964,758.62 2,399,273.87 -
Total of owners’ equity 483,698,740.52 463,474,038.85 546,292,318.15 533,651,254.56
Total of liabilities and owners’
equity 3,975,833,046.66 3,476,263,403.98 2,465,647,799.18 2,241,258,559.72建设摩托 Interim Report 2010
１３
Income Statement
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. In RMB
Items Consolidated Parent company
Jan-Jun 2010 Jan-Jun 2009 Jan-Jun 2010 Jan-Jun 2009
I. Turnover 1,285,320,978.49 1,123,947,549.20 1,474,723,970.07 1,173,833,260.90
Less: Operation cost 1,094,442,596.50 967,453,241.88 1,391,086,918.44 1,125,311,154.84
Business tax and surcharge 18,016,511.79 16,981,679.88 16,837,151.08 16,225,186.46
Sales expense 90,852,618.36 85,562,963.24 23,487,383.46 11,429,393.84
Administrative expense 75,542,764.72 41,163,505.00 57,461,068.88 24,180,501.48
Financial expenses 31,443,524.59 23,752,118.52 23,184,059.74 22,142,455.42
Asset impairment loss 3,415,740.62 -8,255,704.65 -1,649,302.86 -12,923,005.06
Plus: Gains from change of fair
value (“-“ for loss) -
Investment gain (“-“ for loss) 39,673,118.18 3,503,819.19 39,673,118.18 3,503,819.19
Incl. Investment gains
from affiliates 40,176,523.01 4,007,224.02 40,176,523.01 4,007,224.02
II. Operational profit (“-“ for loss) 11,280,340.09 793,564.52 3,989,809.51 -9,028,606.89
Plus: Non business income 2,218,525.56 13,068,462.97 1,575,867.68 11,766,010.16
Less: Non-business expenses 291,568.56 1,027,305.21 177,218.18 679,929.68
Incl. Loss from disposal of
non-current assets 164,553.18 587,448.33 164,553.18 587,448.33
III. Gross profit (“-“ for loss) 13,207,297.09 12,834,722.28 5,388,459.01 2,057,473.59
Less: Income tax expenses 247,395.42 1,964,029.91 247,395.42 1,938,450.76
IV. Net profit (“-“ for net loss) 12,959,901.67 10,870,692.37 5,141,063.59 119,022.83
Net profit attributable to the
owners of parent company 13,394,416.92 11,191,838.68 5,141,063.59 119,022.83
Minor shareholders’ equity -434,515.25 -321,146.31
V. Earnings per share
(I) Basic earnings per share 0.028 0.02 0.01 0.00
(II) Diluted earnings per share 0.028 0.02 0.01 0.00建设摩托 Interim Report 2010
１４
Cash Flow Statement
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. In RMB
Items Jan-Jun 2010C onsolidateJda n-Jun 2009 Jan-Jun 201P0a rent compaJanny- Jun 2009
I. Net cash flow from business operation
Cash received from sales of products and
providing of services 961,943,428.51 847,863,770.43 708,625,432.12 831,256,043.28
Tax returned 15,144,359.23 12,227,008.84 9,765,069.17 8,655,519.35
Other cash received from business operation 37,953,097.92 23,632,756.10 24,485,934.72 6,441,659.19
Sub-total of cash inflow from business activities 1,015,040,885.66 883,723,535.37 742,876,436.01 846,353,221.82
Cash paid for purchasing of merchandise
and services 959,985,708.92 714,345,218.98 863,436,887.78 716,238,375.65
Cash paid to staffs or paid for staffs 97,558,813.14 73,812,136.03 75,738,248.65 54,328,056.34
Taxes paid 37,783,054.59 28,325,722.96 24,220,104.67 20,404,929.95
Other cash paid for business activities 43,345,744.27 37,359,861.27 10,604,114.14 4,598,805.87
Sub-total of cash outflow from business activities 1,138,673,320.92 853,842,939.24 973,999,355.24 795,570,167.81
Cash flow generated by business operation,
net -123,632,435.26 29,880,596.13 -231,122,919.23 50,783,054.01
II. Cash flow generated by investing
Cash received from investment retrieving
Cash received as investment gains 12,000,000.00 - 12,000,000.00 -
Net cash retrieved from disposal of fixed
assets, intangible assets, and other long-term
assets
22,080.00 1,932,550.31 - 1,727,117.31
Net cash received from disposal of
subsidiaries or other operational units
Other investment-related cash received 20,169,248.43 185,116,220.28 15,165,198.80 185,113,793.44
Sub-total of cash inflow due to investment
activities 32,191,328.43 187,048,770.59 27,165,198.80 186,840,910.75
Cash paid for construction of fixed assets,
intangible assets and other long-term assets
37,001,761.01
139,117,801.58
23,458,785.64
136,729,123.80
Cash paid as investment 10,000,000.00 - 10,000,000.00 -
Net cash received from subsidiaries and
other operational units
Other cash paid for investment activities - 112,032.43
Sub-total of cash outflow due to investment
activities 47,001,761.01 139,229,834.01 33,458,785.64 136,729,123.80
Net cash flow generated by investment -14,810,432.58 47,818,936.58 -6,293,586.84 50,111,786.95
III. Cash flow generated by financing
Cash received as investment
Incl. Cash received as investment from
minor shareholders
Cash received as loans 474,800,000.00 649,000,000.00 374,000,000.00 533,100,000.00
Other financing-related cash received 2,275,478,452.04 2,009,675,933.94 2,132,845,932.84 2,914,688,874.67
Subtotal of cash inflow from financing activities 2,750,278,452.04 2,658,675,933.94 2,506,845,932.84 3,447,788,874.67
Cash to repay debts 365,500,000.00 416,500,000.00 249,600,000.00 335,600,000.00
Cash paid as dividend, profit, or interests 32,171,359.92 23,143,866.81 16,488,136.60 9,459,079.17
Other cash paid for financing activities 2,170,846,628.55 1,950,535,311.66 1,936,799,385.65 2,848,395,050.96
Subtotal of cash outflow due to financing
activities 2,568,517,988.47 2,390,179,178.47 2,202,887,522.25 3,193,454,130.13
Net cash flow generated by financing 181,760,463.57 268,496,755.47 303,958,410.59 254,334,744.54
IV. Influence of exchange rate alternation on
cash and cash equivalents -281,399.56 -913,208.31 -39,375.62 16,523.26
V. Net increase of cash and cash equivalents 43,036,196.17 345,283,079.87 66,502,528.90 355,246,108.76
Plus: Balance of cash and cash equivalents at the
beginning of term 399,379,360.33 99,257,459.02 330,985,587.79 38,850,288.91
VI. Balance of cash and cash equivalents at the
end of term 442,415,556.50 444,540,538.89 397,488,116.69 394,096,397.67建设摩托 Interim Report 2010
１５
Consolidated Statement of Change in Owners’ Equity
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd.
Jan-Jun 2009 In RMB
Amount of same period previous year
Owners’ Equity Attributable to the Parent Company
Items
Capital shares Capital reserves
Less:
Shares in
stock
Surplus
reserves Retained profit Others
Minor
shareholders’
equity
Total of owners’
equity
I. Balance at the end of last year 477,500,000.00 590,180,517.59 125,686,000.00 -753,944,567.91 3,426,539.73 442,848,489.41
Plus: Change of accounting policy
Correcting of previous errors
II. Balance at the beginning of current year 477,500,000.00 590,180,517.59 125,686,000.00 -753,944,567.91 3,426,539.73 442,848,489.41
III. Changed in the current year (“-“ for
decrease)
3,848,800.00
11,191,838.68
-321,146.31
14,719,492.37
(I) Net profit 11,191,838.68 -321,146.31 10,870,692.37
(II) Gains/losses accounted into owners’
equity directly
3,848,800.00
3,848,800.00
1. Change in fair value of sellable
financial assets, net
3,348,800.00
3,348,800.00
2. Influence of change in other owners’
equity of invested enterprises on equity
basis
500,000.00 500,000.00
3. Influence of income tax related to
owners’ equity items
4. Others
Total of (I) and (II) 3,848,800.00 11,191,838.68 -321,146.31 14,719,492.37
(III) Investment or decreasing of capital
by owners
1. Capital inputted by owners
2. Amount of shares paid and accounted
as owners’ equity
3. Others
(IV) Profit allotment
1. Providing of surplus reserves
2. Common risk provision
3. Allotment to the owners (or建设摩托 Interim Report 2010
１６
shareholders)
4. Others
(V) Internal transferring of owners’
equity
1. Capitalizing of capital reserves (or to
capital shares)
2. Capitalizing of surplus reserves (or to
capital shares)
3. Making up losses by surplus reserves
4. Others
IV. Balance at end of this year 477,500,000.00 594,029,317.59 125,686,000.00 -742,752,729.23 3,105,393.42 457,567,981.78
Consolidated Statement of Change in Owners’ Equity (Cont.)
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. Jan-Jun 2010 In RMB
Amount of current term
Owners’ Equity Attributable to the Parent Company
Items
Capital shares Capital reserves
Less:
Shares in
stock
Surplus reserves Retained profit Others
Minor
shareholders’
equity
Total of owners’
equity
I. Balance at the end of last year 477,500,000.00 601,303,217.59 125,686,000.00 -743,414,452.61 2,399,273.87 463,474,038.85
Plus: Change of accounting
policy
Correcting of previous errors
II. Balance at the beginning of
current year 477,500,000.00 601,303,217.59 - 125,686,000.00 -743,414,452.61 - 2,399,273.87 463,474,038.85
III. Changed in the current year
(“-“ for decrease) - 7,264,800.00 - 13,394,416.92 -434,515.25 20,224,701.67
(I) Net profit 13,394,416.92 -434,515.25 12,959,901.67
(II) Gains/losses accounted into
owners’ equity directly - -235,200.00
-
-
- -
- -235,200.00
1. Change in fair value of sellable
financial assets, net -235,200.00 -235,200.00
2. Influence of change in other
owners’ equity of invested
enterprises on equity basis
-
3. Influence of income tax related
to owners’ equity items
-建设摩托 Interim Report 2010
１７
4. Others
-
Total of (I) and (II) - -235,200.00 - - 13,394,416.92 - -434,515.25 12,724,701.67
(III) Investment or decreasing of
capital by owners - 7,500,000.00 - - - - - 7,500,000.00
1. Capital inputted by owners -
2. Amount of shares paid and
accounted as owners’ equity -
3. Others 7,500,000.00 7,500,000.00
(IV) Profit allotment - - - - - - - -
1. Providing of surplus reserves -
2. Common risk provision -
3. Allotment to the owners (or
shareholders) -
4. Others -
(V) Internal transferring of
owners’ equity - - - - - - - -
1. Capitalizing of capital reserves
(or to capital shares) -
2. Capitalizing of surplus
reserves (or to capital shares) -
3. Making up losses by surplus
reserves
-
4. Others -
IV. Balance at end of this year 477,500,000.00 608,568,017.59 - 125,686,000.00 -730,020,035.69 - 1,964,758.62 483,698,740.52建设摩托 Interim Report 2010
１８
Statement of Change in Owners’ Equity, the Parent Co. (Cont.)
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. Jan-Jun 2009 In RMB
Amount of current term
Items Capital shares Capital reserves Surplus reserves Retained profit Other
s
Total of owners’
equity
I. Balance at the end of last year 477,500,000.00 588,240,294.29 125,686,000.00 -639,314,769.41 552,111,524.88
Plus: Change of accounting policy
Correcting of previous errors
II. Balance at the beginning of current year 477,500,000.00 588,240,294.29 125,686,000.00 -639,314,769.41 552,111,524.88
III. Changed in the current year (“-“ for decrease) 500,000.00 119,022.83 619,022.83
(I) Net profit 119,022.83 119,022.83
(II) Gains/losses accounted into owners’ equity directly 500,000.00 500,000.00
1. Change in fair value of sellable financial assets, net
2. Influence of change in other owners’ equity of
invested enterprises on equity basis 500,000.00 500,000.00
3. Influence of income tax related to owners’ equity
items
4. Others
Total of (I) and (II) 500,000.00 119,022.83 619,022.83
(III) Investment or decreasing of capital by owners
1. Capital inputted by owners
2. Amount of shares paid and accounted as owners’
equity
3. Others
(IV) Profit allotment
1. Providing of surplus reserves
2. Common risk provision
3. Allotment to the owners (or shareholders)
4. Others
(V) Internal transferring of owners’ equity
1. Capitalizing of capital reserves (or to capital shares)
2. Capitalizing of surplus reserves (or to capital shares)
3. Making up losses by surplus reserves
4. Others
IV. Balance at end of this year 477,500,000.00 588,740,294.29 125,686,000.00 -639,195,746.58 552,730,547.71建设摩托 Interim Report 2010
１９
Consolidated Statement of Change in Owners’ Equity (Cont.)
Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. Jan-Jun 2010 In RMB
Amount of current term
Owners’ Equity Attributable to the Parent Company
Items
Capital shares Capital reserves
Less:
Shares
in stock
Surplus
reserves Retained profit Others
Minor
shareholders’
equity
Total of owners’
equity
I. Balance at the end of last year 477,500,000.00 596,240,294.29 125,686,000.00 -665,775,039.73 533,651,254.56
Plus: Change of accounting policy
Correcting of previous errors
II. Balance at the beginning of current year 477,500,000.00 596,240,294.29 - 125,686,000.00 -665,775,039.73 - - 533,651,254.56
III. Changed in the current year (“-“ for decrease) - 7,500,000.00 - - 5,141,063.59 - - 12,641,063.59
(I) Net profit 5,141,063.59 5,141,063.59
(II) Gains/losses accounted into owners’ equity directly -
1. Change in fair value of sellable financial assets, net
2. Influence of change in other owners’ equity of
invested enterprises on equity basis
3. Influence of income tax related to owners’ equity
items
4. Others
Total of (I) and (II) - 5,141,063.59 5,141,063.59
(III) Investment or decreasing of capital by owners 7,500,000.00 - - - - - 7,500,000.00
1. Capital inputted by owners -
2. Amount of shares paid and accounted as owners’
equity -
3. Others 7,500,000.00 7,500,000.00
(IV) Profit allotment
1. Providing of surplus reserves
2. Common risk provision
3. Allotment to the owners (or shareholders)
4. Others
(V) Internal transferring of owners’ equity
1. Capitalizing of capital reserves (or to capital shares)
2. Capitalizing of surplus reserves (or to capital shares)
3. Making up losses by surplus reserves
4. Others
IV. Balance at end of this year 477,500,000.00 603,740,294.29 - 125,686,000.00 -660,633,976.14 - - 546,292,318.15建设摩托 Interim Report 2010
20
Chongqing Jianshe Motorcycle Co., Ltd.
Notes to Financial Statements, Interim 2010
(In RMB except for otherwise stated)
I. Company Profile
Chongqing Jianshe Motorcycle Co., Ltd. (formerly Shenzhen Northern Jianshe Motorcycle Co., Ltd.) (“the Company”
hereinafter) was founded on July 19, 1995 by Jianshe Industry (Group) Co., Ltd. (Jianshe Group) and China Northern
Industry (Shenzhen) Co., Ltd. The Company was registered in Chongqing with the certificate of business No.
5000001805583. The Company listed its B-shares in Shenzhen Stock Exchange on July 25, 1995.
On Dec. 30, 2002, the company’s temporary general meeting of shareholders passed a resolution of changing the
company name‘Shenzhen Northern Jianshe Motorcycle Co., Ltd.’ as ‘Chongqing Jianshe Motorcycle Co., Ltd.’. The
business administrative registration was completed on March 11, 2003.
Jianshe Group and the China Southern Industrial Group (Southern Group) signed an ‘Agreement of Equity Transfer’ on
Dec. 3, 2004 and a ‘Supplementary Agreement of Equity Transfer’ on Jan. 22, 2005. According to these agreements,
Jianshe Group transferred 339,625,000 of state-owned legal representative shares to Southern Company. The transfer
had been approved by State-owned Assets Supervision and Management Committee of State Council on March 9, 2005
and approved by the China Securities Regulatory Commission to exempt Southern Group’s obligations of Takeover
Offer on May 2005.
In September 2005, under the approval the Foreign capital [2005] certificates No. 0628 of the People's Republic of China
Department of Commerce, the company changed from the domestic-fund corporation to the foreign-fund corporation and
completed the registration of business change in August 2007, receiving new legal representative business license
‘Registered No.500000400001350’, and the registered address is Chongqing. The original registered capital was RMB
477.5 million Yuan.
In April 2007, according to the Guangdong Province Shenzhen Intermediate People's Court ‘(2006) second instance
judgement No.21-4 on bankruption by Intermediate People's Court of Shenzhen city’, 17.875 million shares of
state-owned legal representative shares by China Northern Industrial Shenzhen Company were transferred to Yangpu
New Yufeng Investment Co., Yonghui FENG and Zuocheng GU. Yangpu New Yufeng Investment Co. held 7 million
shares, Yonghui FENG held 2 million shares and Zuocheng GU held 8.875 million shares.
The controlling shareholder of the company is Southern Group, the largest shareholder of which is State-owned Assets
Supervision and Management Committee of State Council. The Committee hold 100% shares of Southern Group.
Business scope: motorcycle and parts (including engine), automobile parts (excluding engine), common machinery,
industrial equipment module manufacturing and processing, home appliance and material sales.
II. Statement on the Accounting Standard Followed by the Company
The company’s financial statements are prepared basing on the principles described in Note III – Basis of preparing the
financial statements, which are satisfying the requirements of the Enterprise Accounting Standard. The financial
statements are reflecting the financial situation, business performance, and cash flow situation of the Company truthfully,
fairly, and completely.建设摩托 Interim Report 2010
21
III. Basis for Preparing the Financial Statements
The Company follows the 38 practical rules including Enterprise Accounting Standard – Basic Rules and Enterprise
Accounting Standard No.1 – Inventory, as well as the guidelines issued by the Department of Finance in 2006, known as
the ‘New Accounting Standard’.
The Company adopts perpetual operation as the basis of financial statements.
IV. Major accounting policies and estimations
1. Accounting period
A fiscal year is the year from January 1 to December 31 of the solar calendar.
2. Standard currency for bookkeeping
The Company uses Renminbi (RMB) as the standard currency for book keeping.
3. Accounting measurement properties
Historical cost measurement is mainly adopted in preparing the financial statements. Finance asset, finance debt,
disposable finance asset, derived finance tools were calculated by fair value; delayed stock products, fixed asset caused
by exceeding normal credit when purchasing were calculated by current value of purchasing price; stock products which
subtracted value were calculated by real value, other assets which subtracted value were calculated by returnable value
(the higher between fair value and current value); Asset inventory surplus was calculated by replacement cost.
4. Cash equivalents
Cash equivalent refers to the investment held by the Company with short term (due within 3 months from the purchase
date), strong liquidity and low risk of value fluctuation that is easy to be converted into cash of known amount.
5. Translation of foreign currencies
Business transactions involving with foreign currencies occurred in the fiscal year are booked and translated into RMB at
the central parity rate announced by People’s Bank of China at the end of previous month.
At the balance sheet day, foreign currency items are translated at the rate of instant date, however the exchange
differences caused by the difference between the rates at the balance sheet date and the initial recognition date or at the
previous balance sheet date, shall be accounted into current gain/loss account; the amount in standard currency of
non-monetary items accounted in foreign currencies and on historical cost basis shall not be changed.
Exchange differences caused by foreign currency loans relating to purchasing or constructing of assets which satisfy the
conditions of capitalization, are accounted according to the principles adopted for loan expenses.
6. Financial instruments
(1) Categories
The Company classifies financial assets and financial liabilities into: transactional financial assets and liabilities,
investment equity held to maturity, receivable accounts, disposable financial assets, and other financial liabilities.
(2) Recognition of financial instruments
When the Company becomes one of the parties of a financial instrument contract, the financial asset or liability is
recognized.
(3) Measurement of financial instruments
Fair value is adopted at initial recognition of financial assets or liabilities. The related transaction expenses of
transactional financial assets or liabilities are accounted directly to current gain/loss account; transaction expenses of
other financial assets or liabilities are accounted into initial recognition amount.建设摩托 Interim Report 2010
22
The Company uses fair value in subsequent accounting of financial assets, and will not deduct the contingent expenses
that may occur in future disposal. Whereas investment held to maturity and receivable accounts are accounted on actual
interest basis and at the amortized costs.
The Company uses fair value in accounting of transactional financial liabilities, and will not deduct the contingent
expenses that may occur in future clearance. Whereas other financial liabilities are accounted on actual interest basis and
at the amortized costs.
Gains or losses formed by change of fair value of transactional financial assets or liabilities are accounted into current
gain/loss account; gains or losses formed by change of fair value of disposable financial assets, except for impairment
losses and exchange gain/loss formed by financial assets in foreign currencies, are accounted into owners’ equity directly,
and transferred out to current gain/loss as soon as the financial asset is terminated.
The gains or lost occurred at termination recognition, impairment, or amortizing of financial assets or liabilities
accounted at amortized costs are accounted into current gain/loss account directly.
(4) Recognition of financial asset transferring
The financial assets are recognized for termination when almost all the risks and rewards of the ownership rights are
transferred; if almost all the risks and rewards of the ownership right are reserved, no termination will be recognized.
(5) Measurement of financial asset transferring
If the termination conditions are satisfied when a financial asset is transferred in full, the differences between the
following items are accounted into current gain/loss: a. book value of the financial asset to be transferred; b. the sum of
consideration received for the financial asset and the accumulative change of fair value originally accounted into owners’
equity (if the financial asset to be transferred is disposable financial asset).
(6) Deciding of fair value
If there is an active market, the fair value of financial asset or liability is recognized at the price in the active market.
If there is no such active market, the fair value of financial instruments is recognized by estimation technique.
(7) Impairment of financial assets
At the balance sheet day, the Company investigates the book value of financial assets other than transactional financial
assets, when impairment is proved by objective evidences, impairment provisions shall be provided. When impairment
happened to a financial asset accounted at amortized costs, the book value of this financial asset shall be reduced to the
current value of predicted future cash flow, the reduced amount shall be recognized as asset impairment loss and
accounted into current gain/loss account.
When objective evidence showing that the value of a financial asset accounted at amortized cost has been restored after
recognition of impairment, and substantially related to the issues occurred after recognition of the impairment (for
instance the credit grade of the debtor has increased), the impairment loss recognized originally shall be restored and
accounted into current gain/loss account. However, the book value shall not be exceeding the amortized costs of the
financial asset at the restoring date provide the impairment provision has never been provided.
7. Bad debt provisions on receivable accounts
If there are any objective evidence showing that impairment has occurred to a receivable account (including receivable
account and other receivables), the difference between the book value and the present value of expected future cash
flows is recognized as bad debt provision.
For individual account receivable with minor amount, and those with major amount but suggested no impairment when
separate test was performed (include account receivable and other capital receivable), the Company conduct the
proportion of all the compositions’ bad debt plans according to the actual loss rate of the similar account receivable
composition with same account age together with the current conditions. The rates are:
Account age Provision rate
within 1 yr 5%
1-2 yrs 10%
2-3 yrs 20%
Over 3 yrs 50%建设摩托 Interim Report 2010
23
Bad debt provisions shall be provided on individual recognition basis when solid evidence showing that there is
difference between the possibilities of recovering.
The book value of receivable accounts are reduced by provision account (bad debt provisions). If an impaired credit is
evaluated as unrecoverable, termination recognition shall be performed.
8. Inventories
Inventories are categorized as raw materials, products in process, and finishd products, etc.
Inventories are accounted at actual costs, which include purchase costs, processing costs, and other costs. When
inventories are delivered, the costs are recognized by weighted average method or FIFO method. At the balance sheet
day, the inventories are measured at the lower of the costs and net realizable value.
Low-value consumables and packing materials are amortized at one-off basis.
The company adopt perpetual method for inventory counting.
Recognition basis of net realizable value of inventories： the net realizable net of finished goods is the estimated selling
price less the estimated costs to sell and the relevant tax； when the net realizable value of held-for-production materials
is higher than the costs, they are measured at the costs；when the price of the materials decrease, which indicates the net
realizable value of the finished goods is lower than the costs，the net realizable value is the estimated selling price less
the estimated costs incurred until the completion of production, and the estimated costs to sell and the relevant tax; the
net realizable value of held-for-sale materials is the market price.
Method for providing inventory impairment provision: at the balance sheet date, inventory impairment provisions are
provided at the difference of book value over realizable net value, and accounted to current gain/loss account. If the
value restored in subsequent periods, the impairment provision provided previously shall be restored and accounted into
current gain/loss account.
9. Enterprise merger
(1) Merger of enterprise under common control
For merger of enterprise under common control, the Company uses equity integration method in accounting treatment.
For those assets and liabilities acquired through merger shall be accounted at original book value except for those
according to different accounting standard, no goodwill will be calculated anyway. The difference between the book
value of considerations and the book value of the net asset acquired will be adjusted to capital reserves, when the capital
reserve is not enough for adjusting, the balance shall be adjusted to retained profit. Net profit of the merged enterprise
realized prior to the merger shall be accounted into consolidated income statement.
(2) Merger of enterprises under different control
The difference of the acquisition cost greater than the fair value of recognizable net asset of the enterprise acquired is
accounted as goodwill, and measured as the cost less accumulative impairment provisions; The difference of the
acquisition cost shorter than the fair value of recognizable net asset of the enterprise acquired is accounted into current
gain/loss.
Business results of the acquired enterprise are consolidated since the date of merger, till the controlling power is
transferred out of the Company.
10. Long-term equity investment
(1) Categories of long-term equity investment
Long-term equity investment is categorized as: long-term equity investment to subsidiaries, long-term equity investment
to joint-ventures, long-term equity investment to associated enterprises, long-term equity investment to enterprise
without mutual control or major influence, and has no quotation in an active market, and the fair value is not able to be
measured reliably (“other equity investment”).
(2) Initial measurement of long-term equity investment
The initial costs of long-term equity investment formed in enterprise merger will be decided at the following basis: For
long-term equity investment formed in merger of enterprises under same controlling, the initial investment cost of the建设摩托 Interim Report 2010
24
long-term equity investment will be the share of booked owners’ equity of the enterprise been merged. The expenses
directly related to the merger will be counted as gain/loss of the current term instantly. For long-term equity investment
formed in merger of enterprises under different controlling, the initial investment cost of the long-term equity investment
will be upon the capital paid to acquire the ownership, liabilities undertaken, and the fair value of equity securities placed.
The expenses directly related to the merger will be counted as initial investment cost directly.
For long-term investment obtained in term of cash payment, its initial investment cost will be the actual price paid. Initial
investment cost includes expenses, taxes and other necessary expenditures directly related to obtaining of the long-term
investment, however the cash dividend announced but not collected included in the actual price shall be booked
particularly as one of the receivables.
Long-term equity investment obtained through issuing of equity stocks, the initial investment cost shall be accounted at
the fair value of the equity stocks issued.
Long-term equity investments input by investors are initialized at the value stipulated by the investment contract or
agreement, except for those contracted values are not fairly acceptable.
Long-term equity investment obtained through exchange of non-monetary assets, if this trade is commercial and the fair
values of the assets been traded are able to be reliably measured, then the fair value of outgoing asset will be used as the
initial investment cost. The difference between the fair value and book value of the outgoing asset is accounted into
current gain/loss account. If the non-monetary asset trade is not satisfying both of the above conditions, then the book
value of the outgoing asset and taxes will be adopted as the initial investment cost.
Long-term equity investments acquired through debt reorganizing, the initial investment costs are recognized at the fair
value of the equity acquired. The differences between the investment cost and the book value of the credit are accounted
into current gain/loss account.
(3) Subsequent measurement of long-term equity investment
The Company adopts cost basis for accounting of long-term equity investments in subsidiaries and other equity
investments. At preparing of the consolidated financial statements, the long-term equity investment in subsidiaries are
adjusted on equity basis.
Equity basis is also adopted in accounting of long-term equity investment in joint ventures and associated enterprises.
At balance sheet day, if there is indication showing impairment occurred on the long-term equity investment in
subsidiaries, long-term equity investment in joint-ventures, and long-term equity investment in associated enterprises,
the recoverable amount shall be evaluated, when the recoverable amount is lower than the book value, the impairment
loss shall be recognized and accounted into current gain/loss, and long-term equity investment impairment provision
shall be provided thereof. When impairment occurred to other equity investment, the differences between the current
value of future cash flow determined with reference to the income rate of similar financial assets in the market shall be
recognized as impairment losses and accounted into current gain/loss, and long-term equity investment impairment
provision shall be provided thereof. None of the above long-term equity investment impairment provision shall be
written back in subsequent terms.
(4) Recognition of income from long-term equity investment
Long-term equity investments accounted on cost basis are priced at initial investment costs. Supplementary or retrieved
investments are adjusted to the cost of long-term equity investment. Cash dividend or profit distribution announced by
the investee are recognized as investment gains of the current term. Recognition of investment gains is limited to the
allocated amount of the accumulated net profit after the investment has been made. The exceeding part of profit or cash
dividend over the above amount is treated as retrieving of initial investment cost.
Long-term equity investment accounted on equity basis, investment gain/loss is recognized at the share of net gain/loss
realized by the investee and adjusted to the book value of the long-term equity investment. Profit distribution or cash
dividend announced or delivered by the investee shall be deducted from the book value of long-term equity investment.
Other change of owners’ equity by the investee other than net gain/loss shall be adjusted to the book value of the
long-term equity investment and accounted into owners’ equity.
At disposal of long-term equity investment, the difference between the book value and actual consideration shall be
accounted into current gain/loss account. For long-term equity investment on equity baisis, the changes in owners’ equity
other than gain/loss accounted into owners’ equity, it will be transferred over to current gain/loss from the part originally
accounted into owners’ equity when disposed.建设摩托 Interim Report 2010
25
11. Investment property
The investment properties of the company are classified as land-use right for lease, buildings for lease and land-use right
held for transfer when value added.
The investment properties are measured initially at the costs, and the subsequent measurement is by cost method.
The Company adopts depreciation or amortizing methods on investment properties which are the same with fixed assets
and intangible assets.
When evidence showing that the investment properties are impaired at the balance sheet day, investment property
impairment provisions shall be provided with the method described in ‘15. Asset impairment’ hereafter.
12. Fixed assets
(1) Standards of fixed assets
The fixed assets are the tangible assets held for goods produced, services rendered, leasing or administration and the
using life are over one accounting period.
(2) Fixed assets are recognized by satisfying all of the following conditions：
a. The economic benefits related to the fixed asset probably flow to the company.
b. The costs of the fixed asset can be measured reliably.
(3) Categories of fixed assets
The fixed assets of the company is classified as house and buildings, machinery equipments, electronic equipments,
transport equipments and office appliances.
(4) Depreciation basis
The depreciation method is by straight-line method, and depreciation ratio is decided in accordance with the original
value and useful life after deducting of predicted scrap value (3% of original value). Depreciation ratio on useful life
are:
Category of assets Expected service life Annual depreciation ratio %
Houses & buildings 30-35 yrs 2.77-3.23
Equipment & machinery 7-14 yrs 6.93-13.86
Transportation equipment and office appliances 5-8 yrs 12.13-19.40
(5) Fixed asset impairment provision
On the balance sheet day, the company should check whether or not there has the indication that the fixed assets might
be impaired. If the indication exists, it will be taken the impairment test to recognize its recoverable amount and should
be made provision at the low of the book value and the recoverable cost.
When one of the following becomes true, fixed asset impairment provision shall be provided at the book value in full:
a. Fixed asset has been idle for a long time, and is not expected to be put into use again, and no value recovering through
disposal;
b. Fixed asset becomes unusable due to technical upgrading;
c. The fixed asset is still usable, but could produce large amount of defective products;
d. Damaged and not usable or disposable.
e. Other fixed assets practically unable to bring financial benefits to the Company.
Once fixed asset impairment is recognized, it shall not be written back in subsequent fiscal periods.建设摩托 Interim Report 2010
26
13. Construction-in-process
Construction-in-process refers to necessary expenses occurred before the constructed or purchased fixed asset reaches
its usable status, including direct materials, direct wages, equipment to be installed, construction & installation fee,
project management fee, net gain/loss of project trial operation and loan expenses allowed to be capitalized, etc.
Construction-in-process is transferred to fixed assets as soon as it becomes usable.
At the balance sheet day, if evidence showing that impairment occurred to the construction-in-process, impairment
provisions shall be provided according to 15. Asset Impairment hereafter.
14. Intangible assets
(1) Initial recognition
Intangible assets are land using rights, patents, and non-patent technologies, which are measured at cost basis.
(2) Subsequent measurement
Intangible assets are categorized to limited useful life and unlimited useful life according to their estimated beneficial
period, whereas those can’t be estimated are categorized as intangible assets without definite useful life.
For intangible assets with limited useful life, its amortizable amount shall be amortized rationally through its useful life,
if the realizing way is not able to be reliably predicted, straight amortizing shall be applied.
The Company reviews, at least once at end of each year, the useful life and amortizing method of the intangible assets
with limited useful life, and shall adjust when necessary.
Intangible assets without definite useful life are not amortized, but reviewing shall be performed on the useful life, and
impairment test as well.
On the balance sheet day, when there is sign of impairment on the intangible asset, intangible asset impairment provision
shall be provided according to 15. Asset Impairment hereafter.
(3) Estimation of useful life
The company consider the following factors when estimating the life of intangible assets with finite life:
- the life cycle of the products produced by the assets, and the available information of the similar assets’ life；
- the current stage of technology, art and so on, and the evaluation of future development trend；
- the market demand of products or services provided by the assets；
- current or potential competitors are expected to take action；
- expected maintenance expenses for maintaining the ability of the assets to bring economic benefits, and the company’s
ability of expected to pay the expenses；
- relevant laws and regulations or similar restrictions for the controlling period of the assets, such as licensed using
period and the leasing period；
- relevance that is related to service life of other assets held by the company.
(4) Specific standards of R&D stage in internal R&D projects and specific standards of expenditure on development
The expenditure on internal R&D are recorded in gain or loss at the occurrence time.
The expenditure incurred on development are recognized as intangible assets when satisfying the following conditions
simultaneously:
- the technical availability of finishing the intangible asset that can be used or sold；
- equipped with the intention of use and sale after the completion of the intangible asset；
- The mode of creating the economic benefits from the intangible asset includes can demonstrate there is the market for
the products of the intangible asset or the intangible asset itself. If the intangible asset is used internally, the usability can建设摩托 Interim Report 2010
27
be demonstrated；
- there has the supporting by sufficient technique, financial resources and other resources to complete the development of
the intangible asset and the company have the competence of using or selling this intangible asset；
- The expenditure on the development stage of the intangible asset can be measured reliably.
15. Asset impairment
On the balance sheet day, if there is sign of impairment on particular asset (refers to assets other than inventory, equity
instruments without quotation in an active market and cannot be measured reliably, investment property uses fair value,
consumable biological assets, assets formed by construction contracts, deferred income tax assets, the unsecured balance
among the financed leasing, and financial assets), recoverable amount shall be evaluated for each individual asset; When
the recoverable value could not be estimated on a single asset, it can be decided along with the portfolio it belongs to.
The returnable amount is the higher value of net value of individual asset, asset composition, asset composition group’s
fair value deduct dealing expenditures and anticipating future cash flow net value of the individual asset, asset
composition, asset composition group.
When the recoverable amount of single asset is lower than its book value, asset impairment provision shall be provided
at the difference of the book value and the recoverable value. If the recoverable value of a portfolio or a group of
portfolios is lower than its book value, the balance shall be recognized as impairment loss, which shall be firstly
deducted from the book value of the portfolio or the group of portfolios, and then deducted from the book value of other
assets according to the portion of book value of the portfolio or group of portfolios other than goodwill; deduction of
above book values of assets shall be provided for impairment provisions individually (including goodwill).
Once impairment losses are confirmed upon the above assets, they won’t be restored in successive accounting periods.
16. Borrowing expenses
Borrowing expenses are those interests and costs of raising loans, including interests, amortizing of discount or premium,
supplementary expenses, and exchange difference caused by loans in foreign currencies.
Borrowing expenses for purchasing or construction of assets that are satisfying the conditions of capitalization shall be
capitalized, other borrowing expenses are accounted into current gain/loss account. Assets satisfying the conditions of
capitalization are those fixed assets, investment assets or inventories which need a long period of time to purchase,
construct, or manufacturing before becoming usable.
(1) Capitalizing shall be performed when all of the following conditions are satisfied:
- asset expenditure has already occurred;
- Loan expenses has already occurred;
- Construction or production activities that are essential to make the asset usable or sellable have started.
Capitalizing of borrowing expenses is suspended as soon as the asset has reached the expected usable or sellable
situation. The subsequent borrowing expenses shall be accounted into current gain/loss account.
If the asset satisfying the capitalizing conditions was abnormally suspended in the process of purchasing or construction
for over three months, capitalizing of borrowing expenses shall be suspended, borrowing expenses occurred in the
suspension period shall be accounted into current gain/loss account.
(2) In the period of capitalization, the amount of interest to be capitalized in each fiscal period is decided with the
following method:
- For special borrowings, the amount is decided at the actual interest occurred in the current term less provisional interest
income or investment gains.
- For common borrowings, the amount is decided by the weighted average of accumulated asset expenditure over special
borrowings multiply the capitalization ratio of common borrowings. Capitalization ratio is decided by the weighted
average of common borrowing interests.建设摩托 Interim Report 2010
28
17. Predicted liabilities
When the liability related to contingent issues is satisfying all of the following conditions, they are recognized as
predicted liabilities
- this liability is a current liability assumed by the Company;
- executing of this liability may cause outflow of financial interests;
- the amount of the liability may be measured reliably.
At recognizing of liability amount, if there is a limited range of expenditure to settle the liability, it can be decided at the
average of upper and lower limit; and the following method shall be adopted if there isn’t any limited range of
expenditure:
- When the intangible item is involving with a single subject, it is decided at the most possible amount;
- When the intangible item is involving with multiple items, it is calculated according to the possible amount and its
probability.
18. Revenue
Revenue is recognized when the financial benefit will possibly inflow to the Company, the amount is reliably
measurable, and the following conditions shall be satisfied in all:
(1) Goods sold
Sales income is recognized when: Major risks and rewards attached to the goods have been transferred to the purchaser;
The Company holds neither successive management power which is normally attached to ownership, nor effective
control, over the goods which have been sold out; Amount of income may be reliably measured; when the costs,
occurred or will occur, may be measured reliably.
(2) Providing of services
At balance sheet day, those service trades (simultaneously satisfying the requirements of those: income can be measured
reliably, related economic benefit will flow in very possibly, transaction procedure can be confirmed reliably, happened
and happening cost can be measured reliably) which can be reliably estimated are recognized at the percentage of
completion, and progress of completion of service is decided by the portion of costs occurred over the estimated total
costs. At balance sheet day, those service trades which can not be reliably estimated, if the happened services cost will be
compensated, the services income are recognized according to happened service cost and transited to service cost
according to same amount; if the happened services cost will not be compensated, the happened services cost are
accounted into current term’s gain or loss and the services income will not be recognized.
(3) Rendering of right to use
The interest income are measured by the time of others using the assets and the effective interest. The use costs are
measured by agreed charging time and method in the contract or agreement.
19. Income tax
Income tax is including current income tax and differed income tax. Except for those goodwill adjustment by income tax
occurred due to merger of enterprises, or income tax from trade accounted as owners’ equity which are accounted into
owners’ equity, all of them are accounted into income tax expenses or gains under current gain/loss account.
The Company accounts the income tax liabilities or assets formed in current or previous terms basing on the payable or
refunding amount according to the taxation law.
Differed income taxes are drawn by balance sheet liability method according to the provisional differences between the
book value of asset and liabilities and the tax basis.
All of the provisional differences of payable taxes provide the basis of differed income tax liabilities, unless the
provisional differences are formed in the following trades:
- Initial recognition of goodwill;
- the trade is not a merger of enterprises, however it made no influence on the accounting profit nor on the taxable建设摩托 Interim Report 2010
29
income (or deductible loss);
- For provisional differences of tax payable related to investment in subsidiaries, joint-ventures or affiliate enterprises,
the timing of writing back of the provisional difference is under control, and it is not possible to be written back in a
expectable future.
Differed income tax asset generated by deductible provisional difference is recognized to the limitation of the amount of
tax payable on the provisional differences possibly used to deduct, unless the provisional difference is generated by one
of the following trade:
- the trade is not a merger of enterprises, however it made no influence on the accounting profit nor on the taxable
income (or deductible loss);
- For provisional differences of tax payable related to investment in subsidiaries, joint-ventures or affiliate enterprises,
recognition of the differed income tax asset is on: it is possible to be written back in a expectable future, and the taxable
income amount probably be obtained to neutralize the deductible provisional differences.
On the date of balance sheet, if there is solid evidence showing that sufficient tax payable could be obtained in future to
neutralize the deductible provisional differences, the differed income tax asset not recognized in previous term shall be
recognized.
On the date of balance sheet, as for the differed income tax asset and differed income tax liabilities, according to the tax
law, are measured at the tax rate applicable to the expected period of the asset to be retrieved or liabilities to be settled,
and shall reflect the income tax influence of the expected asset retrieving or liability settling on the balance sheet date.
At the balance sheet day, verification will be performed on the book value of differed income tax assets. If it is not
possible to obtain enough taxable income to neutralize the benefit of differed income tax assets, then the book value of
the differed income tax assets shall be reduced. Whenever obtaining of taxable income became possible, the reduced
amount shall be restored.
20. Government allowance
Government subsidies are recognized at their fair value whenever they are definite to be obtained and all supplementary
conditions are satisfied. If the income-related government subsidy is only applicable to makeup future expenses or losses,
it is recognized as differed income and accounted into current gain/loss of the period when the expense or loss is
recognized. Asset-related government subsidies are recognized as differed income, and amortized straightly to the useful
life of the related assets, and accounted into current gain/loss account.
21. The Consolidated Financial Statements
(1) Principles of consolidated accounts
All of the subsidiaries of the Company are included in the consolidated accounts.
(2) Preparing of consolidated accounts
Basing on the accounts of the parent company and the subsidiaries included in the consolidation range, major
investments, trades, inventory purchasing or sales, and internal transactions are neutralized before consolidated one after
another, and the minority shareholders’ equity and gain/loss shall be calculated.
(2) Presenting of minor shareholders’ equity and gain/loss
The share of current net gain/loss attributable to the minority shareholders shall be presented under Minority
Shareholders’ Gain/loss of the Net Profit in the consolidated income statement.
The share of owners’ equity in the subsidiary attributable to the minority shareholders, is demonstrated as Minority
Shareholders’ Equity under the owners’ equity item in the consolidated balance sheet.
(4) Treatment of exceeding losses
When the current loss of minority shareholders of a subsidiary is greater than the share of the minority shareholders in
the owners’ equity, if the minority shareholders are obligated by the Articles of Association or investment agreement for
this, and the minority shareholders are capable to make it up, the minority shareholders’ equity shall be deducted at the
amount of exceeded loss. Or otherwise it will be deducted from the owners’ equity of the parent company. Profits
realized by the subsidiaries in subsequent periods are attributable to the owners’ equity of the parent company prior to建设摩托 Interim Report 2010
30
making up of the minority shareholders’ losses undertaken by the owners’ equity of the parent company.
(5) Treatment of subsidiaries added or eliminated in the current term
In the report term, new subsidiaries added by merger of enterprises under common control, the revenue, expenses and
profits of the subsidiary from the beginning of current fiscal term to the end of report term are consolidated to the
consolidated income statement. New subsidiaries added by merger of enterprises under different control, the revenue,
expenses and profit of the subsidiary since the day of merger to the end of report term are consolidated into the
consolidated income statement.
When a subsidiary is disposed, the revenue, expenses and profits since the beginning of report term to the day of disposal
are included in the consolidated income statement.
V. Change in accounting policy and accounting estimation, retrospect of accounting
errors
No change in accounting policies and accounting estimations nor retrospect of accounting errors occurred in the report
term.
VI. Taxation
Categories and rates of taxes applicable to the Company:
Type of taxes Tax basis Tax ratio
VAT Income from sales of products, processing and repairing services 17%
Business tax Income from leasing and taxable services 5%
Consumption tax Income from sales of consuming products 3%
City maintenance and construction tax VAT, business tax, consumption tax already paid 7%
Education surtax VAT, business tax, consumption tax already paid 3%
Enterprise income tax Amount of income taxable 15%、25%
According to the tax laws, the consumption tax rate applicable to the company was changed from 10% to 3% since April
1, 2006.
The company and its subsidiary (Chongqing Jianshe Vehicle-used Airconditioning LLC.) can enjoy the lower tax rate
under the tax policies of Western large-scale development, according to the regulation of Guo Shui Fa［2002］No.
47‘Notice of specific implementation opinion towards the tax policies of Western large-scale development from State
Taxation Administration’. Corporate income tax of the company and its subsidiary (Chongqing Jianshe Vehicle-used
Air-conditioning LLC.) is paid at the rate of 15% from 2007 to 2010 after the application of the company and the
approval of taxation administration.
Corporate income tax of other subsidiaries is paid at the rate of 25%.建设摩托 Interim Report 2010
31
VII. Consolidation of entities and consolidated financial statements
1. Subsidiaries obtained through merger of firms under common control
Full name of the
entity invested in
Reg. Add. Business scope Registered
capital
RMB0’000
Actual
investment of
parent co.
(RMB0’000)
Percentage of
share by the
Company %
Percentage of
voting power
%
Consolidated?
Chongqing
Northern Jianshe
Import & Export
Co., Ltd.
Chongqing Operation and agency of
various kinds of goods and
technology import and export
(exclude those prohibited by the
national government)
6,037.80 6,037.80 100% 100% Yes
2. Subsidiaries acquired through merger of enterprises under different control
Full name of the
entity invested in
Reg. Add. Business scope Registered
capital
RMB0’000
Actual investment of
parent co.
(RMB0’000)
Percentag
e of share
by the
Company
%
Percentage
of voting
power %
Consoli
dated?
Shanghai Jianshe
Motorcycle Co.,
Ltd.
Note (2)
Shanghai Motorcycle with two wheels, portable
motorcycle with two wheels and
installation kits manufacturing and
sale, moped manufacturing and sale,
power-driven bicycle and its parts
manufacturing and sale (license when
required)
1,600 816 51% 51% Yes
3. Subsidiaries incorporated in other ways
Full name of the entity
invested in
Reg. Add. Business scope Registered
capital
RMB0’000
Actual
investment of
parent co.
(RMB0’000)
Percentage
of share
by the
Company
%
Percent
age of
voting
power
%
Consoli
dated?
Chongqing Jianshe Sales
Co., Ltd.
Chongqing Sales of motorcycles and parts, vehicle
air-conditioner and parts, electro-mechanical
products, metal materials, home appliances,
repairing of home appliances
1,200 1,200 100% 100% Yes
Chognqing Jianshe
Automobile
Air-conditioner
Compressor Co., Ltd.
Note (3) Chongqing Production, sales, and services of automobile
air-conditioners and parts
16,000 16,000 100% 100% Yes
Guangxi Jianshe
Motorcycle Co., Ltd.
Note (4) Nanning Sales of motorcycle and parts 150 78 52% 52% Yes
Chengdu Jianshe Sales
Co., Ltd.
Note (4) Chengdu Wholesale and retail of motorcycle and parts
with “Jianshe” trademark
50 50 100% 100% Yes
Huhehaote Jianshe
Motorcycle Sales Co.,
Ltd.
Note (4) Huhehaote Wholesale and retailing of motorcycles and
parts
50 50 100% 100% Yes
Chongqing Jianshe
Motorcycle Sales Co.,
Ltd.
Note (5) Chongqing Sales of vehicles, motorcycles, and parts 50 50 100% 100% Yes
Ningbo Jianshe
Motorcycle
Manufacturing Co., Ltd.
Note (6) Chongqing Manufacturing and sales of motorcycles and
parts
1,600 816 51% 51% No
Note (1) The Company is directly holding 95.14% of the shares of Chongqing Northern Jianshe Import & Export Co.,
Ltd. (the Import & Export Co.), Chongqing Jianshe Sales Co., Ltd. – one of the full subsidiaries of the Company is
holding 4.86% of the shares, thus the Company is holding 100% of the shares of the Import & Export Co.
(2) Shanghai Jianshe Motorcycle Co., Ltd. is a subsidiary of the Company acquired through merger of enterprise under
different control. For the Company is not able to amortize the balance of fair value of recognizable asset and liabilities of
Shanghai Jianshe Motorcycle Co., Ltd. less the amortized amount to the recognizable asset and liabilities of Shanghai
Jianshe Motorcycle Co., Ltd. in a reasonable way, therefore according to the “Opinion of Specialists on Implementing of
the Enterprise Accounting Standard”, the Company decided to amortize the balance to the retained life circle straightly,
the retained balance is demonstrated as “Other non-current assets” in the consolidated balance sheet.建设摩托 Interim Report 2010
32
(3) The Company is directly holding 43.75% of the shares of Chongqing Jianshe Automobile Air-conditioner Co., Ltd.
(the Air-conditioner Co.), while Chongqing Jianshe Sales Co., Ltd. – one of the fully –owned subsidiaries is holding
37.50% of the shares, the Import & Export Co. is holding 18.75% of the shares, therefore the Company is holding 100%
of the shares of the Air-conditioner Co.
(4) The Company is holding 52% of shares in Guangxi Jianshe Motorcycle Co., Ltd. through Chongqing Jianshe Sales
Co., Ltd. – the fully owned subsidiary; holding 100% of the shares of Chengdu Jianshe Sales Co., Ltd. through
Chongqing Jianshe Sales Co., Ltd.; holding 100% of the shares of Huhehaote Jianshe Motorcycle Sales Co., Ltd.
(5) The Company is directly holding 45% of the shares of Chongqing Jianshe Motorcycle Sales & Marketing Co., Ltd.
(the Sales & Marketing Co.), Chongqing Jianshe Sales Co., Ltd. – the fully-owned subsidiary of the Company, is holding
55% of the shares, therefore the Company is holding 100% of the shares of the Sales & Marketing Co.
(6) For Ningbo Jianshe Motorcycle Manufacturing Co., Ltd. is still in clearing process, the Company has provided
long-term investment impairment provision on it, therefore it was not included in the consolidated accounts.
4. Minority shareholders’ equity as of June 30, 2010
Name of the companies June 30, 2010
Minority shareholders’ share
June 30, 2010
Amount of minority shareholders’ equity (yuan)
Guangxi Jianshe Motorcycle Co., Ltd. 48% 22,358.21
Shanghai Jianshe Motorcycle Co., Ltd. 49% 1,942,400.41
Total 1,964,758.62建设摩托 Interim Report 2010
33
VIII. Notes to Consolidated Financial Statements
1. Monetary fund
June 30, 2010 December 31, 2009
Originalcurrency Exchange
rate TranslatedtoRMB Originalcurrency Exchange
rate TranslatedtoRMB
CASH
RMB 130,044.21 1.00 130,044.21
58,232.90
1.00
58,232.90
USD
- -
EUR - -
JPY - -
BRC
- -
Subtotal
130,044.21 130,044.21 58,232.90 58,232.90
BANK SAVINGS RMB
430,683,824.11 1.00 430,682,399.23
346,792,138.90
1.00
346,792,138.90
USD
1,659,928.01 6.81 11,308,968.62
910,460.63
6.83
6,216,762.38
EUR
23,941.48 8.27 197,996.04
45,953.04
9.80
450,206.53
JPY
- -
Subtotal
432,367,693.60 442,189,363.89 347,748,552.57 353,459,107.81
OTHER MONETARY CAPITAL
RMB 1,187,937,005.19 1.00 1,187,937,005.19
950,904,495.20
1.00
950,904,495.20
USD
EUR
- -
1,963.64
9.80
19,237.98
Subtotal
1,187,937,005.19 1,187,937,005.19 950,906,458.84 950,923,733.18
Total 1,620,434,743.00 1,630,256,413.29 1,298,713,244.31 1,304,441,073.89
Note: (1) The balance of monetary capital at end of June 2010 has increased by 24.98% over the end of 2009, which was
caused by increase of bank accepted notes balance and deposit for issuing of the notes has increased thereof.
(2) As of June 30, 2010, there was RMB1,187,840,856.79 among above of deposit for bank accepted notes and
RMB96,148.40 was for deposit of L/C.
2. Notes receivable
Items June 30, 2010 December 31, 2009
Bank acceptance 49,267,844.52 107,463,525.56
Commercial acceptance - 5,000,000.00
Total 49,267,844.52 112,463,525.56
Note: No notes receivable used for collateral in the report term.
3. Account receivable
(1) Account receivable
Account receivable categorized as following:建设摩托 Interim Report 2010
34
June 30, 2010 December 31, 2009
Items
Amount Proportion
%
Bad debt
provision
Amount Proportion
%
Bad debt
provision
Account receivable with major single amount 213,602,223.19 74.63 10,680,111.16 80,840,842.06 44.36 4,042,042.10
Account receivable without major amount but greater risk
after combined into group of similar risks
7,732,345.71 2.70 7,732,345.71 7,449,829.22 4.09 7,449,829.22
Other minor account receivable 64,885,706.68 22.67 4,041,230.39 93,959,416.93 51.55 5,128,379.34
Total 286,220,275.58 100.00 22,453,687.26 182,250,088.21 100 16,620,250.66
Note: The Company recognizes account receivable with RMB5 million or over of single amount as major amount basing
on the business scale and characteristics. For account receivable with major amount, if no impairment proved by
impairment test, the Company provides bad debt provisions basing on their ages.
Account receivable without major amount, but with greater risk after combined with accounts with similar risks, is
recognized when there is obvious sign of hard to retrieve and aged over three years.
Age of account receivable
Account age June 30, 2010 December 31, 2009
Amount Proportion % Bad debt provision Amount Proportion % Bad debt provision
within 1 yr 265,927,422.81 92.91 13,296,371.15 169,136,422.69 92.8 8,448,689.68
1-2 yrs 10,871,310.10 3.80 1,087,131.01 4,110,355.01 2.26 411,035.50
2-3 yrs 1,689,196.96 0.59 337,839.39 1,553,481.29 0.85 310,696.26
Over 3 yrs 7,732,345.71 2.70 7,732,345.71 7,449,829.22 4.09 7,449,829.22
Total 286,220,275.58 100.00 22,453,687.26 182,250,088.21 100 16,620,250.66
Note: (1) The receivable accounts due from top 10 debtors were amounted to RMB191,706,443.00, accounted for
66.98% of the total receivable accounts, details are:
The debtors Amount Property of the debt Age
Chongqing Changan Automobile Co., Ltd. 48,287,681.82 Sales within 1 yr
Chongqing Jianshe YAMAHA Motorcycle Co., Ltd. Chongqing Branch 36,562,500.00 Sales within 1 yr
China Northern Vehicle Co., Ltd. 28,785,511.00 Sales within 1 yr
YAMAHA MOTOR CO.,LTD 14,648,616.88 Sales within 1 yr
Jiangxi Changhe SUZUKI Automobile Co., Ltd. 14,147,681.64 Sales within 1 yr
Yuxin Automobile Air-Conditioner Co., Ltd. 12,831,156.50 Sales within 1 yr
Nanjing Xiezong Automobile Co., Ltd. 10,068,329.00 Sales within 1 yr
Chongqing Chang’an SUZUKI Automobile Co., Ltd. 9,340,834.92 Sales within 1 yr
Baoding Greatwall Northern China Automobile Co., Ltd. 8,665,103.93 Sales within 1 yr
Nigeria Sales Limited 8,369,027.31 Sales within 1 yr
Sub-total 191,706,443.00建设摩托 Interim Report 2010
35
(2) No debts due from shareholders holding 5% or over of the Company’s shares.
(3) Receivable accounts due from related parties are accounted for 29.64% of the total.
(2) Other receivable accounts
Other receivable accounts are categorized as:
Items June 30, 2010 December 31, 2009
Amount Proportion
%
Bad debt
provision
Amount Proportion
%
Bad debt
provision
Account receivable with major single amount 10,971,591.72 36.49 3,411,560.39 29,042,215.25 65.93 4,043,982.03
Account receivable without major amount but greater
risk after combined into group of similar risks 1,524,370.74 5.07 1,229,497.16 2,338,621.48 5.31 1,422,663.22
Other minor account receivable 17,573,610.52 58.44 1,210,186.60 12,666,893.39 28.76 890,644.61
Total 30,069,572.98 100.00 5,851,244.15 44,047,730.12 100.00 6,357,289.86
Note: The Company recognizes other account receivable with RMB3 million or over of single amount as major amount
basing on the business scale and characteristics. Including: RMB3,013,664.00 credit due from Shenzhen Jianshe
Motorcycle Co., Ltd., which was formed when the company was founded. For the company has not put into normal
operation, the Company has provided bad debt provision in full after performing of individual impairment test.
Other account receivable without major amount, but with greater risk after combined with accounts with similar risks, is
recognized when there is obvious sign of hard to retrieve and aged over three years.
Age of other account receivable
Age June 30, 2010 December 31, 2009
Amount Proportion % Bad debt provision Amount Proportion % Bad debt provision
within 1 yr 25,042,582.77 83.27 1,319,949.57 38,212,195.18 86.75 1,716,711.19
1-2 yrs 312,751.00 1.04 31,275.10 916,585.43 2.08 91,658.54
2-3 yrs 65,240.00 0.15 13,048.00
Over 3 yrs 4,714,239.21 15.69 4,500,019.48 4,853,709.51 11.02 4,535,872.13
Total 30,069,572.98 100.00 5,851,244.15 44,047,730.12 100.00 6,357,289.86
Note (1) No account in the balance of above account was due from shareholders with 5% or over of the Company’s
shares.
(2) Receivable accounts due from related parties are accounted for 26.48% of the total.
4. Prepayment
Items June 30, 2010 December 31, 2009
Amount Ratio (%) Amount Ratio (%)
within 1 yr 155,126,440.45 86.13 70,054,114.68 51.24
1-2 yrs 22,862,207.01 12.69 63,529,119.14 46.47
2-3 yrs 456,925.14 0.25 3,123,901.12 2.29
Over 3 yrs 1,657,558.47 0.92
Total 180,103,131.07 100.00 136,707,134.94 100.00
Note (1) No account in the balance of above account was due from shareholders with 5% or over of the Company’s
shares.(2) Prepaid account aged over one year was because the Company has not settled with the supplier yet.建设摩托 Interim Report 2010
36
5. Inventory and inventory impairment provision
(1) Inventory
Items 2009-12-31 2010-6-30
Raw materials 29,253,290.07 21,499,901.92
Product in process 16,159,787.93 19,574,066.90
Finished products 20,1824,682.34 238,669,261.91
Others
Total 247,237,760.34 279,743,230.73
(2) Inventory impairment provision
Items 2009-12-31 Provided this term
Decreased this
term
2010-6-30
Raw materials
Product in process
Finished products 3,045,348.81 1,911,650.27 1,133,698.54
Total 3,045,348.81 1,911,650.27 1,133,698.54
Note: Inventory impairment provision was recognized according to the part of cost over the realizable net value. The
realizable net value means the amount of estimated value of inventory less estimated cost to finish it, sales expenses and
taxes.
6. Joint-ventures and affiliates
Items Reg. Add. Business property Share
proportion %
Portion of
voting rights
June 30, 2010
Net asset
Jan-Jun 2010
Turnover
Jan-Jun 2010
Net profit
Joint ventures
Chongqing Pingshan Taikai
Carburetor Co., Ltd.
Chongqing
Manufacturing and sales of
carburetor
49% 49% 147,031,434.72 50,798,987.03 3,540,108.56
Chongqing Jianshe
YAMAHA Motorcycle Co.,
Ltd.
Chongqing
Manufacturing and sales of
motorcycles and parts
50% 50% 593,012,297.931,229,066,051.2441,297,311.22
Zhuzhou Jianshe YAMAHA
Motorcycle Co., Ltd.
Zhuzhou
Manufacturing and sales of
motorcycles and parts
50% 50% 543,612,960.75 501,579,966.0634,748,345.79
Affiliates
Chongqing Tongsheng
Jianshe Industry Co., Ltd.
(Note)
Chongqing
Production and sales of
motorcycle parts
30% 30% 2,424,246.26 60,665,142.40 217,303.36
Chongqing Fuda Property
Management Co., Ltd.
Chongqing
Cargo transportation and
warehousing
20% 20% 588,398.36 11,874,930.07 3,987.11建设摩托 Interim Report 2010
37
7. Disposable financial asset
Stock Code Stock ID Initial investment Share
portion
Book value at end
of term
Gain/loss of the
report term
Change of owners’ equity in the
report term
000536 S ST Mindong 81 0.23% 5,202,400.00 -313,600.00
Total 81 0.23% 5,202,400.00 -313,600.00
8. Long-term equity investment
Items June 30, 2010 December 31, 2009
Book balance Impairment
provision
Book value Book balance Impairment
provision
Book value
Investment in
joint-venture
631,338,847.22 631,338,847.22 603,526,920.05 603,526,920.05
Investment in
associated
business
2,358,397.95 2,358,397.95
2,293,206.94 2,293,206.94
Other equity
investment 14,340,915.04 4,340,915.04 10,000,000.00 4,340,915.04 4,340,915.04
Total 648,038,160.21 4,340,915.04 643,697,245.17 610,161,042.03 4,340,915.04 605,820,126.99
Details:
Items Share
proportion %
Initial amount December 31,
2009
Increased this
term
Decreased this
term
June 30, 2010 Dividend received
in current term
On cost basis
Chongqing Jingjian Automobile
Air-conditioner Co., Ltd.
6.74% 3,200,000.00
3,200,000.00
3,200,000.00
Ningbo Jianshe Motorcycle
Manufacturing Co., Ltd.
51.00%
8,160,000.00 1,140,915.04 1,140,915.04
Subtotal 11,360,000.00 4,340,915.04 4,340,915.04
On equity basis
Chongqing Pingshan Taikai
Carburetor Co., Ltd.
49% 67,316,539.87 72,107,178.82 1,734,653.19 299,404.83 73,542,427.18
Chongqing Jianshe YAMAHA
Motorcycle Co., Ltd.
50% 154,699,622.03 269,422,299.76 20,648,655.61 290,070,955.37
Zhuzhou Jianshe Yamaha
Motorcycle Co., Ltd.
50% 215,710,320.08 261,997,441.47 17,728,023.20 12,000,000.00 267,725,464.67 12,000,000.00
Chongqing Fuda Property
Management Co., Ltd.
20% 400,000.00 116,882.26
116,882.26
Chongqing Tongsheng Jianshe
Industry Co., Ltd.
30% 3,000,000.00 2,176,324.68 65,191.01 2,241,515.69
Chongqing Southern
Motorcycle Technologies
Development Co., Ltd.
8.33%
10,000,000.00 10,000,000.00
Subtotal 451,126,481.98 605,820,126.99 40,176,523.01 12,299,404.83 643,697,245.17 12,000,000.00
Total 462,486,481.98 610,161,042.03 40,176,523.01 12,299,404.83 648,038,160.21 12,000,000.00
Impairment of long-term equity investment
Items December 31, 2009 Provided this year Written back
this year Other decreases June 30, 2010
Chongqing Jingjian Automobile
Air-conditioner Co., Ltd. 3,200,000.00 3,200,000.00
Ningbo Jianshe Motorcycle Manufacturing
Co., Ltd. 1,140,915.04 1,140,915.04
Total 4,340,915.04 4,340,915.04建设摩托 Interim Report 2010
38
9. Fixed assets
Items December 31, 2009 Increased this
term Decreased this term June 30, 2010
I. Total of original value 1,248,636,377.30 61,201,935.43 1,835,831.57 1,308,002,481.16
Houses & buildings 351,747,105.91 5,855.21 351,752,961.12
Equipment & machinery 851,116,720.20 56,478,707.53 817,373.45 906,778,054.28
Transportation and office appliances 22,374,817.72 279,405.64 1,018,458.12 21,635,765.24
Others 23,397,733.47 4,437,967.05 27,835,700.52
II. Total of accumulative depreciation 539,459,911.19 43,764,567.52 916,153.27 582,308,325.44
Houses & buildings 14,372,651.80 4,427,286.93 18,799,938.73
Equipment & machinery 505,278,603.84 37,472,815.12 76,478.15 542,674,940.81
Transportation and office appliances 12,843,477.92 1,089,857.21 839,675.12 13,093,660.01
Others 6,965,177.63 774,608.26 7,739,785.89
III. Total of accumulative fixed asset
impairment provision 681,430.12 681,430.12
Houses & buildings
Equipment & machinery 681,430.12 681,430.12
Transportation and office appliances
Others
IV. Total of fixed asset book value 708,495,035.99 17,437,367.91 919,678.30 725,012,725.60
Houses & buildings 337,374,454.11 -4,421,431.72 332,953,022.39
Equipment & machinery 345,156,686.24 19,005,892.41 740,895.30 363,421,683.35
Transportation and office appliances 9,531,339.80 -810,451.57 178,783.00 8,542,105.23
Others 16,432,555.84 3,663,358.79 20,095,914.63
Note: (1) The Company uses the property with book value of RMB7,819,328.23 (RMB20,000,000.00 as negotiated by
the parties) as collateral for the short-term loan of RMB4,000,000.00 from China Industrial & Commercial Bank
Fengxian Branch.
(2) As of June 30, 2010, the original value of fixed assets which have been fully depreciated but still in service were
amounted to RMB227,892,378.10, and the accumulative depreciation was RMB221,023,843.00
10. Construction-in-process
Project December 31,
2009
Increased this
term
Transferred to
fixed assets
(decrease)
Other
decreases
June 30, 2010 Fund
recourse
Equipment under
installation 1,851,993.21 18,945,026.22 2,307,692.37 18,489,327.06
Motorcycle testing
track 296,311 296,311.00
Expanding of
compressor
productivity
20,000.00 20,000.00
Reconstruction of
testing circumstance
generator
90,620.50 90,620.50
Flat grinder 15,589.00 15,589.00
Total 1,867,582.21 19,351,957.72 2,307,692.37 18,911,847.56
Note: No capitalized amount of borrowing expenses among the above construction-in-process balance.建设摩托 Interim Report 2010
39
11. Intangible assets
Items December 31, 2009 Increased this term Decreased this term June 30, 2010
I. Total of original value 102,024,087.62 102,024,087.62
Land using right 94,574,636.64 94,574,636.64
Non-patent technologies 7,449,450.98 7,449,450.98
II. Total of accumulative amortizing 13,066,031.62 2,116,956.36 15,182,987.98
land using rights 9,996,916.89 944,625.30 10,941,542.19
Non-patent technologies 3,069,114.73 1,172,331.06 4,241,445.79
III. Total of impairment provisions 0.00
Land using right 0.00
Non-patent technologies 0.00
IV. Total of book value 88,958,056.00 -2,116,956.36 86,841,099.64
Land using right 84,577,719.75 -944,625.30 83,633,094.45
Non-patent technologies 4,380,336.25 -1,172,331.06 3,208,005.19
12. Development expenses
Items
Balance at the
beginning of
year
Increased this term Decreased this
term
Balance at the end of
year
JS400K/KDC 95,731.60 -2,487.30 93,244.30
JS250ATV-8 3,251,743.97 106,245.14 3,357,989.11
JS150-B 4,154,450.09 152,191.48 4,306,641.57
JS150-B-1 247,264.96 7.59 247,272.55
JS150-3 3,499,057.11 556,112.11 4,055,169.22
JS150-3-1 400,805.65 688,362.39 1,089,168.04
JS110-K 3,819,040.97 485,523.69 4,304,564.66
JS110-K-1 48,222.20 377,692.28 425,914.48
JS125-6C 2,326,307.22 278,668.32 2,604,975.54
JS125-6C-1 415,213.68 6,923.07 422,136.75
JS400ATV-3 1,782,264.45 1,782,264.45
700 engine 1,683,730.86 628,038.09 2,311,768.95
F33 engine 949,171.53 51,282.04 1,000,453.57
JS125T-C 4,856,399.87 350,048.85 5,206,448.72
JS125T-C-1 37,521.37 37,521.37
JS125-H 421.16 421.16
F33 1,932,037.27 242,346.87 2,174,384.14
JS400ATV-5 1,819,965.27 348,137.01 2,168,102.28
JS400ATV-5-1 160,000.00 160,000.00
JS400-7 1,914,155.47 30,609.89 1,944,765.36
JS700ATV 1,838,398.23 502,933.25 2,341,331.48
JS110-B(F3) 1,000,656.02 354,266.04 1,354,922.06
Euro III qualification 3,272.80 1,256,281.12 1,259,553.92
Models of “Chongqing” trademark 196.08 196.08
JS125-6H 212,767.44 212,767.44
JS125-7C 45,000.06 45,000.06
CQ110-9B 457.50 457.50
JS250ZH Tricycle 306,788.38 306,788.38
Light electrical bicycle (Dove series) 96,068.93 96,068.93
Total 36,235,410.59 7,074,881.48 43,310,292.07
Note: The Company has spent RMB23,622,996.71 in internal R&D projects, including RMB16,548,115.23 accounted
into researching expenses, RMB7,074,881.48 into developing expenses.建设摩托 Interim Report 2010
40
13. Long-term expenses to be amortized
Category December 31,
2009
Increased this
term
Decreased this
term
Amortized this
term
June 30, 2010
Module expenses 3,369,970.97 724,645.24 2,645,325.73
83 machine technical
initial fee 11,645,956.80 691,704.96 10,954,251.84
Total 15,015,927.77 1,416,350.20 13,599,577.57
14. Deferred income tax asset and deferred income tax liabilities
(1) Differed income tax assets
June 30, 2010 December 31, 2009
Items
Deductible provisional
difference of differed
income asset recognized
Deductible provisional
difference of differed
income asset recognized
Deductible provisional
difference of differed
income asset recognized
Differed income
tax asset
Bad debt provision
on receivable
accounts
14,747,048.23 2,212,057.24 14,484,700.82 2,172,705.13
Inventory
impairment
provision
823,328.76 123,499.31 2,734,979.03 410,246.85
Long-term equity
investment
impairment
provision
1,140,915.04 171,137.26 1,140,915.04 171,137.26
Fixed asset
impairment
provision
681,430.12 102,214.52 681,430.12 102,214.51
Neutralizable losses 55,563,579.68 8,334,536.95 55,563,579.68 8,334,536.95
Total 72,956,301.83 10,943,445.28 74,605,604.69 11,190,840.70
(2) Differed income tax liabilities
June 30, 2010 December 31, 2009
Items
Periodic difference of
taxable differed
income tax liabilities
recognized
Provisional
difference of taxable
differed income tax
liabilities recognized
Periodic difference of
taxable differed
income tax liabilities
recognized
Provisional difference
of taxable differed
income tax liabilities
recognized
Fluctuation of fair
value of disposable
financial assets
accounted into capital
reserves
3,850,000.00 962,500.00 4,163,600.00 1,040,900.00
15. Detail of asset impairment provision
Items December 31, 2009 Provided
current term Written back Transferred June 30, 2010
Bad debt provision 22,977,540.52 5,327,390.89 28,304,931.41
Inventory impairment
provision 3,045,348.81 1,911,650.27 1,133,698.54
Long-term equity
investment impairment
provision
4,340,915.04 4,340,915.04
Fixed asset impairment
provision 681,430.12 681,430.12
Total 31,045,234.49 5,327,390.89 1,911,650.27 34,460,975.11建设摩托 Interim Report 2010
41
16. Other non-current assets
Items December 31, 2009 Increased this term Decreased this term June 30, 2010
Balance of difference of debit of
Shanghai Jianshe Motorcycle Co.,
Ltd. under original accounting
policies
2,040,000.00 204,000.00 1,836,000.00
Note: Causation of other non-current assets (for details please go to Note VII. Enterprise merger and consolidated
accounts)
17. Short-term loans
Categories June 30, 2010 December 31, 2009
Credit loan 232,800,000.00
Pledged loan 112,400,000.00 162,400,000.00
Guarantee loan 240,000,000.00 405,500,000.00
Loan by pledge 14,750,594.68
Total 585,200,000.00 582,650,594.68
Note: (1) Guaranteed loans in the report term:
Loans from The creditor Total Amount Guarantor
Chongqing Jianshe Motorcycle Co., Ltd. Everbright Bank Xuefu Branch
30,000,000.00
Chongqing Jianshe Industry Co., Ltd.
Sub-total 30,000,000.00
Chongqing Jianshe Sales Co., Ltd. China Merchants Bank Jiulongpo Branch 50,000,000.00 South-western Military Industry Co.
Sub-total 50,000,000.00
Communication Bank Jiulongpo Branch 40,000,000.00 South-western Military Industry Co.
Bank of China Chongqing Branch 40,000,000.00 Chongqing Jianshe Motorcycle Co., Ltd.
Pudong Development Bank Jiulongpo
Branch 50,000,000.00 Chongqing Jianshe Motorcycle Co., Ltd.
Chognqing Jianshe Automobile
Air-conditioner Compressor Co., Ltd.
CITIC Bank Chongqing Branch 30,000,000.00 Chongqing Jianshe Industry Co., Ltd.
Sub-total 160,000,000.00
Total 240,000,000.00
(2) Loans with collateral
Loans from The creditor Total Amount collateral
Communication Bank Jiulongpo Branch
48,400,000.00
Chongqing Jianshe
Motorcycle Co., Ltd.
Equipment & machinery
Chongqing Jianshe Motorcycle Co.,
Ltd.
China Import & Export Bank Chongqing
Branch
60,000,000.00
Chognqing Jianshe
Automobile Air-conditioner
Compressor Co., Ltd.
Land
Sub-total 108,400,000.00
Shanghai Jianshe Motorcycle Co.,
Ltd.
China Industrial & Commercial Bank
Shanghai Branch Fengxian Sub-branch 4,000,000.00 Property colleteral
Sub-total 4,000,000.00
Total 112,400,000.00建设摩托 Interim Report 2010
42
(3) Credit loans of the report term:
Loans from The creditor Total Amount Collateral
China Industrial & Commercial Bank, Chonqing Yangjiaping Branch 62,000,000.00
Huaxia Bank, Jiulongpo Branch 50,000,000.00
China Agriculture Bank Banan Branch 100,000,000.00
Chongqing Jianshe Motorcycle Co., Ltd.
CITIC Bank Chongqing Branch 20,000,000.00
Sub-total 232,000,000.00
Shanghai Jianshe Motorcycle Co., Ltd. Shanghai Yangwang Investment Development Co., Ltd. 800,000.00
Sub-total 800,000.00
Total 232,800,000.00
The Company demonstrates the bank loans received from transferring of receivable accounts not satisfying termination
recognition conditions as short-term loans.
18. Notes payable
Items June 30, 2010 December 31, 2009
Bank acceptance 1,821,710,000.00 1,442,081,176.00
Commercial acceptance
Total 1,821,710,000.00 1,442,081,176.00
Note: (1) Among above notes payable: a. RMB715,000,000.00 was the bank accepted notes secured by bank deposit of
RMB715,000,000.00. b. RMB293,010,000.00 was the bank accepted notes guaranteed by the Company;
RMB90,000,000.00 was the bank accepted notes guaranteed by Chongqing Jianshe Industry Co., Ltd.
RMB42,860,000.00 was the bank accepted notes guaranteed by Chongqing Jianshe Automobile Air-conditioner Co.,
Ltd.; RMB383,340,000.00 was the bank accepted notes guaranteed by South-Western Military Industry Co., Ltd.;
RMB297,500,000.00 was the bank accepted notes issued against credit.
(2) No account payable to related parties in the notes payable.
(3) No account due to shareholders with 5% or over of shares in the notes payable account.建设摩托 Interim Report 2010
43
19. Account payable
Items June 30, 2010 December 31, 2009
Account payable Amount Ratio (%) Amount Ratio (%)
within 1 yr 515,134,589.48 97.69
485,459,035.57 94.81
1-2 yrs 5,847,067.68 1.11 21,407,733.58 4.18
2-3 yrs 2,690,611.52 0.51 3,305,300.75 0.65
Over 3 yrs 3,652,212.36 0.69 1,845,053.22 0.36
Total 527,324,481.04 100.00 512,017,123.12 100.00
Prepayment received
within 1 yr 121,664,215.44 99.90 180,166,424.04 99.69
1-2 yrs 1,750.00 0.00 436,883.91 0.24
2-3 yrs 100,081.70 0.08 100,085.86 0.06
Over 3 yrs 20,844.18 0.02 20,844.18 0.01
Total 121,786,891.32 100.00 180,724,237.99 100.00
Other account payable
within 1 yr 85,830,738.56 97.24 27,192,433.62 90.35
1-2 yrs 95,061.94 0.11 836,009.39 2.78
2-3 yrs
Over 3 yrs 2,340,491.60 2.65 2,067,148.92 6.87
Total 88,266,292.10 100.00 30,095,591.93 100.00
Note: (1) No account payable to shareholders with 5% or over of shares of the Company;
(2) Account payable to related parties counted 5.00% of the total payables; Other account payable to related parties
counted 45.09% of the total of other payable account.
20. Wage payable
Items December 31, 2009 Increased this term Decreased this term June 30, 2010
Wage 2,275,665.71 75,344,472.34 76,493,695.19 1,126,442.86
Welfare fee 4,396,103.23 4,396,103.23
Trade union and education allowance 1,130,850.98 1,325,690.77 1,598,033.95 858,507.80
Social insurance 205,758.87 12,500,060.49 12,446,712.31 259,107.05
Housing fund 3,182,289.00 3,173,240.00 9,049.00
Executive awarding fund
Dismissing policy
Others 1,259,810.00 1,259,810.00
Total 3,612,275.56 98,008,425.83 99,367,594.68 2,253,106.71
21. Tax payable
Items June 30, 2010 December 31, 2009
VAT -7,973,248.73 -3,213,360.40
Business tax 83,331.51 91,018.95
Consumption tax 137,952,467.45 141,472,109.23
City construction tax 24,601.39 25,736.27
Education surtax
Enterprise income tax -12,292,552.33 -12,292,552.33
Other taxes 343,935.68 154,514.13
Total 118,138,534.97 126,237,465.85建设摩托 Interim Report 2010
44
22. Special payables
Items
December 31,
2009
Increased this
term
Account transferred
this term
June 30,
2010
400kg mobile carrier research 1,025,000.00 162,500.00 1,187,500.00
Development fund of environmental friendly high sound
quality motorcycle 50,000.00 50,000.00
Consulting fee for integrated product development
demonstration project 20,000.00 20,000.00
Industry development special fund granted by Bureau of
Finance 320,000.00 320,000.00
Special creativity fund by Chongqing Science & Tech
Committee 120,000.00 120,000.00
Fund from China Automobile Institute 30,000.00 30,000.00
Fund from Banan Science & Technologies Committee 150,000.00 150,000.00
Fund for key new product from Banan Science &
Technologies Committee 15,000.00 15,000.00
Fund for JS700ATV full landscape vehicle from Chongqing
Intellectual Property Bureau 100,000.00 100,000.00
Total 1,830,000.00 162,500.00 1,992,500.00
23. Capital Share
Items December 31, 2009 Changed this year (+/-) June 30, 2010
Amount of
shares
Proportion Issuing
of new
shares
Bonus
shares
Transferred
from
reserves
Others Sub-total Amount of
shares
Proportion
I. None negotiable
shares
Domestic legal
person shares 357,500,000.00 74.87% 357,500,000.00 74.87%
II. Negotiable
shares
Foreign shares
listed at home 120,000,000.00 25.13% 120,000,000.00 25.13%
III. Total of capital
shares 477,500,000.00 100% 477,500,000.00 100%
24. Capital reserves
Items December 31, 2009 Increased this term Decreased this term June 30, 2010
Share capital premium 344,407,741.07 344,407,741.07
Other capital reserves 256,895,476.52 7,500,000.00 235,200.00 264,160,276.52
Total 601,303,217.59 7,500,000.00 235,200.00 608,568,017.59
Note: Capital reserves increased by RMB7,500,000.00, which was caused by the special fund of RMB7,500,000.00 for
“097” project granted by China Southern Industry Group – the holding shareholder of the Company, in the report term,
and recorded to capital reserves. Capital reserves reduced by RMB235,200.00 this term, which was caused by decrease
of fair value of Mindong stock held by Chongqing Jianshe Sales Co., Ltd. – the subsidiary of the Company, by
RMB235,200.00.建设摩托 Interim Report 2010
45
25. Surplus reserves
Items December 31, 2008 Increased
this term
Decreased
this term
Jun 30, 2009 Cause of change
Statutory surplus reserves 125,686,000.00 125,686,000.00
Total 125,686,000.00 125,686,000.00
26. Retained profit
Items June 30, 2010 December 31, 2009
Profit not distributed at the beginning of term -743,414,452.61 -753,944,567.91
Increased this term 13,394,416.92 10,530,115.30
- net profit of the year attributable to shareholders of the parent company 13,394,416.92 10,530,115.30
Decreased this term
- providing of statutory surplus reserves
- distribution of common share dividend
Retained profit at the end of term -730,020,035.69 -743,414,452.61
- cash dividend
27. Operation income and operation cost
(1) Operation incomes and costs
Items Jan-Jun 2010 Jan-Jun 2009
Turnover
- Main business income 1,276,393,515.85 1,113,718,855.05
- Other business income 8,927,462.64 10,228,694.15
Total 1,285,320,978.49 1,123,947,549.20
Operation cost
- Main business cost 1,093,222,884.70 965,220,917.50
- Other business cost 1,219,711.80 2,232,324.38
Total 1,094,442,596.50 967,453,241.88
(2) Business segment of turnover:
Items Major business turnover
Jan-Jun 2010 Jan-Jun 2009
Motorcycle and parts 968,602,540.63 915,344,721.65
Vehicle air conditioner 307,790,975.22 198,374,133.40
Total 1,276,393,515.85 1,113,718,855.05
(3) Business segment of cost:
Items Major business cost
Jan-Jun 2010 Jan-Jun 2009
Motorcycle and parts 842,590,519.53 805,401,516.30
Vehicle air conditioner 250,632,365.17 159,819,401.20
Total 1,093,222,884.70 965,220,917.50
Note: Sales to top 5 clients in the report term:
Jan-Jun 2010
Top 5 clients
Jan-Jun 2009
Top 5 clients
Items
Sales volume
RMB0’000
Portion in the category %
Sales volume
RMB0’000
Portion in the category %
Sales to top 5 clients 37,105.45 29.07 26,135.93 23.47建设摩托 Interim Report 2010
46
Geographic segment of sales in Jan-Jun 2010:
Regions Major business turnover Major business cost Main business gross profit
ratio
North 127,702,946.93 110,696,990.37 13.32
East 113,109,678.07 100,751,626.17 10.93
Mid-south 95,411,806.63 87,780,332.36 8.00
South-west 576,476,892.11 451,571,711.50 21.67
North-east 32,574,435.11 30,087,800.98 7.63
North-west 65,936,713.75 60,898,518.32 7.64
South 53,812,254.90 48,861,472.34 9.20
Sub-total of domestic sales 1,065,024,727.50 890,648,452.04 16.37
Overseas sales 211,368,788.35 202,574,432.66 4.16
Total 1,276,393,515.85 1,093,222,884.70 14.35
(2) Business segment of other business incomes and costs
Items Jan-Jun 2010 Jan-Jun 2009
Other business income
Rent of fixed assets 3,840,212.88 6,881,131.99
Sales of materials 1,492,221.53 265,299.72
Trademark-using fee, technical consulting fee, administration fee 420,000.00 2,800,000.00
Others 3,175,028.23 282,262.44
Sub-total 8,927,462.64 10,228,694.15
Other business cost
Rent of fixed assets 272,366.95 1,719,895.90
Sales of materials 889,803.08 153,071.59
Trademark-using fee, technical consulting fee, administration fee 40,000.00
Others 57,541.77 319,356.89
Sub-total 1,219,711.80 2,232,324.38
Other business profit 7,707,750.84 7,996,369.77
28. Business tax and surcharge
Items Jan-Jun 2010 Jan-Jun 2009
Business tax
City maintenance and construction tax 765,362.64 490,177.50
Education surtax 327,950.14 211,335.14
Consumption tax 16,923,199.01 16,280,167.24
Total 18,016,511.79 16,981,679.88
29. Financial expenses
Items Jan-Jun 2010 Jan-Jun 2009
Interest expense 42,716,285.09 38,615,630.69
Less: Incoming interests 12,361,475.48 18,180,153.24
Exchange gains/losses 26,464.33 835,743.40
Others 1,062,250.65 2,480,897.67
Total 31,443,524.59 23,752,118.52
Note: (1) Financial expenses increased by 32.38% this term, which was caused by enlarging of financing scale and
increase of discount interest of notes.
(2) Others including processing fee of RMB1,536,850.78.
30. Asset impairment loss
Items Jan-Jun 2010 Jan-Jun 2009
Bad debt losses 5,327,390.89 -4,629,735.42
Inventory impairment losses -1,911,650.27 -3,625,969.23
Long-term investment impairment loss
Total 3,415,740.62 -8,255,704.65建设摩托 Interim Report 2010
47
31. Investment income
Items Jan-Jun 2010 Jan-Jun 2009
Gains from investment in funds
Credit investment income
Profit distribution announced by the investee on cost basis
Net increase/decrease of owners’ equity of the investee adjusted at end of year 40,176,523.01 4,007,224.02
Amortizing of equity investment balance -503,404.83 -503,404.83
Gains from disposal of equity investment
Other investment income
Total 39,673,118.18 3,503,819.19
Note: Shanghai Jianshe Motorcycle Co., Ltd. is a subsidiary of the Company acquired through merger of enterprise
under different control. For the Company is not able to amortize the balance of RMB3,264,000.00 of fair value of
recognizable asset and liabilities of Shanghai Jianshe Motorcycle Co., Ltd. less the amortized amount to the recognizable
asset and liabilities of Shanghai Jianshe Motorcycle Co., Ltd. in a reasonable way, therefore according to the “Opinion of
Specialists on Implementing of the Enterprise Accounting Standard”, the Company decided to amortize the balance to
the retained life circle straightly, the retained balance is demonstrated as “Other non-current assets” in the consolidated
balance sheet. Amount amortized in this term was RMB204,000.00.
Chongqing Pingshan Taikai Carburetor Co., Ltd. is a joint venture the Company invested in. Its original investment
credit balance at the primary date was RMB3,592,857.98, according to the Enterprise Accounting Standard, it was
transferred to long-term equity investment as the cost of long-term equity investment at the primary date. Meanwhile,
according to the requirement of Enterprise Accounting Standard – Interpret No.1, the credit difference of the long-term
equity investment in joint-ventures shall be amortized in the original retained period, namely the amortized amount in
the report term was RMB299,404.83.
32. Non-business income
Items Jan-Jun 2010 Jan-Jun 2009
Net income from disposing of fixed assets 3,325.77 2,100,667.83
Inventory overage of fixed assets 3,189.73
Gains from exchange of non-monetary assets
Net income of penalty 550.00 438.56
Government subsidy 1,876,491.71 8,831,842.29
Others 338,158.08 2,132,324.56
Total 2,218,525.56 13,068,462.97
Note: Government subsidy is mainly the social security fund of RMB1.36 million from Chongqing Bureau of Finance.
33. Non-business expenditures
Items Jan-Jun 2010 Jan-Jun 2009
Net loss from fixed asset disposal 164,553.18 587,448.33
Outgoing donations 57,834.00
Penalty paid 9,359.24 52,395.16
Compensations paid
Others
117,656.14 329,627.72
Total 291,568.56 1,027,305.21
34. Income tax expenses
Items June 30, 2010 Jun 30, 2009
Income tax payable for the report term 25,579.15
Plus: Differed income tax liabilities at end of term
Less: Differed income tax liabilities at beginning of term
Less: Differed income tax asset at end of term 10,943,445.28 4,215,511.53
Plus: Differed income tax asset at beginning of term 11,190,840.70 6,153,962.29
Income tax expenses of the report term 247,395.42 1,964,029.91建设摩托 Interim Report 2010
48
35. Other cash received or paid related to operation, investment or financing
Cash flow with large amount:
Items Jan-Jun 2010 Jan-Jun 2009
Other cash paid related to operation
Operation fees such as freight, warehousing fees 13,223,495.01 5,559,694.95
Administrative expenses such as office expenses and traveling
expenses 2,909,138.18 16,716,809.83
Others 27,213,111.08 15,083,356.49
Other cash inflow related to operation
Interest income 7,052,831.23 9,017,506.42
Others 30,900,266.69 14,615,249.68
Other cash received related to investment
097 project 15,000,000.00
Technical fund for 400kg mobile platform 162,500.00
Compensation for moving received 184,274,551.97
Fund for environmental friendly high sound quality motorcycle
R&D from the Science and Tech Committee 50,000.00
Fund for Simultaneous system of overall fine production
logistic layout from the Science and Tech Committee 100,000.00
Fund for Demonstrative project of integrated R&D system from
Maite Technologies Co. 20,000.00
Others 5,169,248.43 509,168.31
Other cash paid related to financing
Payment of due financing notes 2,170,846,628.55 2,025,045,311.66
Decrease of note deposit -74,510,000.00
Other cash received related to financing
Financial note discount received 2,412,906,595.27 2,196,447,599.80
Increase of note deposit -137,428,143.23 -186,771,665.86
Connections between net profit and cash flow of business operation:
Items Jan-Jun 2010 Jan-Jun 2009
Net profit 12,959,901.67 10,870,692.37
Plus: Asset impairment provision 3,415,740.62 -8,255,704.65
Fixed asset depreciation, gas and petrol depreciation, production goods depreciation 25,453,765.92 27,421,090.11
Amortizing of intangible assets 2,080,704.66 675,286.14
Amortizing of long-term expenses 1,416,350.20 1,638,388.99
Loss from disposal of fixed assets, intangible assets and other long-term assets
(“-“ for gains) 161,227.41 -1,513,219.50
Loss from fixed assets discarding (“-“ for gains)
Loss from fluctuate of fair value (“-“ for gains)
Financial expense (“-“ for gains) 31,443,524.59 23,752,118.52
Investment loss (“-“ for gains) -39,673,118.18 -3,506,755.40
Decrease of deferred income tax asset (“-“ for increase) 247,395.42 1,938,450.76
Increase of deferred income tax liabilities (“-“ for decrease) -78,400.00
Decrease of inventory (“-“ for increase) -34,430,714.03 -10,045,544.97
Decrease of operational receivables (“-“ for increase) -47,456,712.73 -80,057,610.39
Increase of operational payables (“-“ for decrease) -79,172,100.81 66,963,404.15
Others
Cash flow generated by business operation, net -123,632,435.26 29,880,596.13建设摩托 Interim Report 2010
49
Net change of cash and cash equivalents
Items Jan-Jun 2010 Jan-Jun 2009
Balance of cash at period end 442,415,556.50 444,540,538.89
Less: Initial balance of cash 399,379,360.33 99,257,459.02
Plus: Balance of cash equivalents at the period end
Less: Initial balance of cash equivalents
Net increasing of cash and cash equivalents 43,036,196.17 345,283,079.87
Note: the difference between the balance of cash and the balance of the monetary capital was because the Company was
not treating note deposit as cash and cash equivalents.建设摩托 Interim Report 2010
50
IX. Notes to parent company financial statements
1. Account receivable
(1) Account receivable
Account age June 30, 2010 December 31, 2009
Amount Proportion % Bad debt provision Amount Proportion % Bad debt provision
within 1 yr 14,817,556.88 89.53 740,877.84 129,500.00 7.48 6,475.00
1-2 yrs 129,500.00 0.78 12,950.00 6,325.00 0.37 632.50
2-3 yrs 6,325.00 0.04 1,265.00
Over 3 yrs 1,597,444.58 9.65 1,597,444.58 1,594,979.70 92.15 1,594,979.70
Total 16,550,826.46 100.00 2,352,537.42 1,730,804.70 100.00 1,602,087.20
Note: No debt in the account due from shareholders with 5% or over of shares of the Company.
(2) Other receivable accounts
Account age June 30, 2010 December 31, 2009
Amount Proportion % Bad debt provision Amount Proportion % Bad debt provision
within 1 yr 51,788,873.66 96.06 793,709.75 88,253,612.90 94.72 1,281,812.56
1-2 yrs 697,665.79 0.75
2-3 yrs
Over 3 yrs 4,218,034.74 3.94 4,218,034.74 4,218,034.74 4.53 4,218,034.74
Total 56,006,908.40 100 5,011,744.49 93,169,313.43 100.00 5,499,847.30
Note: No debt in the account due from shareholders with 5% or over of shares of the Company.
2. Long-term equity investment
June 30, 2010 December 31, 2009
Items
Book balance Impairment
provision Book value Book balance Impairment
provision Book value
Investment in joint-venture 631,338,847.22 631,338,847.22 603,526,920.05 603,526,920.05
Investment in associated
business 2,241,515.69 2,241,515.69 2,176,324.68 2,176,324.68
Investment in subsidiaries 160,805,442.92 1,140,915.04 159,664,527.88 151,009,442.92 1,140,915.04 149,868,527.88
Total 794,385,805.83 1,140,915.04 793,244,890.79 756,712,687.65 1,140,915.04 755,571,772.61
Details:
Items
Share
proportion
% Initial amount
December 31,
2009
Increased this
term
Decreased this
term June 30, 2010
Dividend received
in current term
On cost basis
Chongqing Jianshe
Motorcycle Sales Co., Ltd. 45.00% 225,000.00 225,000.00 225,000.00
Chongqing Jianshe Sales Co.,
Ltd. 100.00% 12,000,000.00 12,000,000.00 12,000,000.00
Chongqing Northern Jianshe
Import & Export Co., Ltd. 95.14% 57,443,527.88 57,443,527.88 57,443,527.88
Shanghai Jianshe Motorcycle
Co., Ltd. 51.00% 8,160,000.00
10,200,000.00
204,000.00 9,996,000.00
Chognqing Jianshe
Automobile Air-conditioner
Compressor Co., Ltd.
43.75% 70,000,000.00 70,000,000.00
70,000,000.00
Ningbo Jianshe Motorcycle 51.00% 8,160,000.00 1,140,915.04 1,140,915.04建设摩托 Interim Report 2010
51
Items
Share
proportion
% Initial amount
December 31,
2009
Increased this
term
Decreased this
term June 30, 2010
Dividend received
in current term
Manufacturing Co., Ltd.
Sub-total 155,988,527.88 151,009,442.92 204,000.00 150,805,442.92
On equity basis
Chongqing Southern
Motorcycle Technologies
Development Co., Ltd.
8.34% 10,000,000.00
10,000,000.00
Chongqing Pingshan Taikai
Carburetor Co., Ltd. 49.00% 67,316,539.87 72,107,178.82 1,734,653.19
299,404.83 73,542,427.18
Chongqing Jianshe
YAMAHA Motorcycle Co.,
Ltd.
50.00% 154,699,622.03 269,422,299.76
20,648,655.61 290,070,955.37
Zhuzhou Jianshe Yamaha
Motorcycle Co., Ltd. 50.00% 215,710,320.08 261,997,441.47 17,728,023.20
12,000,000.00 267,725,464.67 12,000,000.00
Chongqing Tongsheng
Jianshe Industry Co., Ltd. 30.00% 3,000,000.00 2,176,324.68 65,191.01 2,241,515.69
Sub-total 460,726,481.98 605,703,244.73 40,176,523.01 12,299,404.83 643,580,362.91
Total 616,715,009.86 756,712,687.65 40,176,523.01 12,503,404.83 794,385,805.83
Impairment of long-term equity investment
Items December 31, 2009 Provided this
year
Written back
this year
Other
decreases June 30, 2010
Ningbo Jianshe Motorcycle Manufacturing Co.,
Ltd. 1,140,915.04 1,140,915.04
Total 1,140,915.04 1,140,915.04
3. Operation income and operation cost
(1) Operation incomes and costs
Items Jan-Jun 2010 Jan-Jun 2009
Turnover
- Main business income 942,325,874.15 869,341,080.10
- Other business income 532,398,095.92 304,492,180.80
Total 1,474,723,970.07 1,173,833,260.90
Operation cost
- Main business cost 865,035,252.01 828,508,915.39
- Other business cost 526,051,666.43 296,802,239.45
Total 1,391,086,918.44 1,125,311,154.84
(2) Business segment of main business incomes and costs
Items Major business turnover
Jan-Jun 2010 Jan-Jun 2009
Motorcycle and parts 942,325,874.15 869,341,080.10
Items Major business cost
Jan-Jun 2010 Jan-Jun 2009
Motorcycle and parts 865,035,252.01 828,508,915.39建设摩托 Interim Report 2010
52
(3) Business segment of other income and cost
Items Jan-Jun 2010 Jan-Jun 2009
Other business income
Rent of fixed assets 3,731,387.88 6,674,941.24
Sales of materials 525,752,326.19 295,817,239.56
Sales of waste material
Trademark royalty 2,000,000.00
Technical consulting and management fee
Others 2,914,381.85
Sub-total 532,398,095.92 304,492,180.80
Other business cost
Rent of fixed assets 272,366.95 1,716,770.88
Sales of materials 525,748,633.81 294,871,793.36
Sales of waste material
Trademark royalty
Technical consulting and management fee
Others 30,665.67 213,675.21
Sub-total 526,051,666.43 296,802,239.45
Other business profit 6,346,429.49 7,689,941.35
4. Investment income
Items Jan-Jun 2010 Jan-Jun 2009
Stock investment income
Credit investment income
Profit distribution announced by the investee on cost basis
Net increase/decrease of owners’ equity of the investee adjusted at end of year 40,176,523.01 4,007,224.02
Amortizing of equity investment balance -503,404.83 -503,404.83
Gains from disposal of equity investment
Income from outsourced financing
Income from entrusted loan
Investment impairment provision provided
Other investment income
Total 39,673,118.18 3,503,819.19
5. Connection of net profit and cash flow from business operation
Items
Jan-Jun 2010 Jan-Jun 2009
Net profit 5,141,063.59 119,022.83
Plus: Asset impairment provision -1,649,302.86 -12,923,005.06
Fixed asset depreciation, gas and petrol depreciation, production goods depreciation 18,106,978.77 19,247,492.44
Amortizing of intangible assets 1,844,920.50 403,250.28
Amortizing of long-term expenses 1,416,350.20 1,073,722.19
Loss from fixed assets, intangible assets and other long-term assets disposal (“-“ for gains) 164,553.18 -1,312,794.98
Loss from fixed assets discarding (“-“ for gains)
Loss from fluctuate of fair value (“-“ for gains)
Financial expense (“-“ for gains) 23,184,059.74 22,142,455.42
Investment loss (“-“ for gains) -39,673,118.18 -3,506,755.40
Decrease of deferred income tax asset (“-“ for increase) 247,395.42 1,938,450.76
Increase of deferred income tax liabilities (“-“ for decrease)
Decrease of inventory (“-“ for increase) 4,446,290.48 35,672,903.91
Decrease of operational receivables (“-“ for increase) -140,717,785.94 30,487,147.76
Increase of operational payables (“-“ for decrease) -103,634,324.13 -42,558,836.14
Others
Cash flow generated by business operation, net -231,122,919.23 50,783,054.01建设摩托 Interim Report 2010
53
6. Net change of cash and cash equivalents
Items
Jan-Jun 2010 Jan-Jun 2009
Balance of cash at period end 397,488,116.69 394,096,397.67
Less: Initial balance of cash 330,985,587.79 38,850,288.91
Plus: Balance of cash equivalents at the period end
Less: Initial balance of cash equivalents
Net increasing of cash and cash equivalents 66,502,528.90 355,246,108.76
Note: the discordance between the cash balance and the monetary capital carried in the financial statement of the parent
company was because the Company hasn’t treated bank note deposit as cash and cash equivalents.
X. Related parties and transactions
1. Related parties
(1) The parent company and substantial controller
Name of the companies Reg.
Add.
Business
property
Relation with the
Company
Registered capital
(RMB0’000)
Shareholding position in the
Company
Voting power in the
Company
China Southern Industry
Group Co., Ltd. Beijing Military
industry
Controlling
shareholder 1,264,521 71.13% 71.13%
(2) Remarks on the subsidiaries
For details please see “VII. Merger of enterprises and consolidated financial statements”
(3) Properties of related parties without controlling relationships
Name of the parties Connection with the Company
Chongqing Jianshe Industry Co., Ltd. Jianshe Industry Subsidiary of the controlling shareholder
South-western Military Industry Co. Subsidiary of the controlling shareholder
Chongqing Jianshe Machinery Co., Ltd. Jianshe Machinery Subsidiary of the controlling shareholder
Military Equipment Group Finance Co., Ltd. Military Finance Co. Subsidiary of the controlling shareholder
Chongqing Changan Automobile Co., Ltd. Changan Auto Grand subsidiary of the controlling shareholder
Chongqing Fuda Property Management Co., Ltd. Fuyeda Co. - Note Grand subsidiary of the controlling shareholder
Chongqing Jianshe Industry & Trade Co., Ltd. Jianshe Industry & Trading Grand subsidiary of the controlling shareholder
Chongqing Jianshe YAMAHA Motorcycle Co., Ltd. Chongqing Yamaha Joint venture of the Company
Zhuzhou Jianshe YAMAHA Motorcycle Co., Ltd. Zhuzhou Jianya Joint venture of the Company
Chongqing Pingshan Taikai Carburetor Co., Ltd. Pingshan Taikai Affiliate of the Company
Chongqing Jianxing Machinery Co., Ltd. Jianxing Machinery Affiliate of the subsidiary of the controlling shareholder
Chongqing Tongsheng Jianshe Industry Co., Ltd. Tongsheng Construction Affiliate of the Company
Chongqing Bailu Industry Co., Ltd. Bailu Industry Grand subsidiary of the controlling shareholder建设摩托 Interim Report 2010
54
2. Related Transactions
(1) Selling of goods
Pricing was on fair market prices.
Name of the parties Jan-Jun 2010 Jan-Jun 2009
Jianshe Industry
792,175.64 84,048,837.16
Chongqing Qiantai Industry & Trade Co., Ltd. 24,115,196.51
Chongqing Jianxing Rubber Products Factory 8,368,392.69
Chongqing Fuda Property Management Co., Ltd. 214,179.89 264,781.06
Jianshe Yamaha 19,765,056.38 120,785,379.20
Pingshan Taikai 16,669,686.38
Chongqing Jianxing Machinery Co., Ltd. 3,066,347.07 3,570,170.00
Changan Auto 69,824,836.37 33,731,246.14
Tongsheng Construction 2,447,736.34
Jianshe Industry & Trading 219,209.44
(2) Purchasing of goods
Name of the parties Jan-Jun 2010 Jan-Jun 2009
Jianshe Industry 130,903,755.51
Jianxing Machinery 7,104,275.62 8,637,956.48
Jianxing Rubber 17,300,615.53
Chongqing Yamaha 1,119,452.83 5,536,143.09
Pingshan Taikai 12,228,802.56 39,370.09
Jianshe Industry & Trading 481,344.77 22,357.27
Chongqing Qiantai Industry & Trade Co.,
Ltd. 53,474,081.93
Tongsheng Construction 2,951,171.81 8,392,386.44
Pricing was on fair market prices.
(3) Providing of services
Name of the parties Jan-Jun 2010 Jan-Jun 2009
Jianshe Industry 7,331.10
Fuyeda Co.
Pricing was on fair market prices.
(4) Accepting of services
Name of the parties Jan-Jun 2010 Jan-Jun 2009
Fuyeda Co. 1,065,596.62 13,622,897.22
Jianshe Industry 15,617,807.97 15,389,227.11
Jianxing Rubber 119,860.25
Jianxing Machinery 7,774.36
Pricing was on fair market prices.
(5) Leasing
Name of the parties Jan-Jun 2010 Jan-Jun 2009
Jianshe Yamaha 2,191,887.06
Shanghai Jianshe Yamaha 1,539,500.82
Prices were negotiated and decided by contracts.
(6) Accepting of fixed assets
Name of the parties Jan-Jun 2010 Jan-Jun 2009建设摩托 Interim Report 2010
55
Prices were negotiated and decided by contracts.
(7) Selling of assets
Name of the parties Jan-Jun 2010 Jan-Jun 2009
(8) Accepting of guarantees
As of June 30, 2009, a. Jianshe Industry has provided guarantee to the Company and the subsidiaries for the short-term
loan of RMB108,400,000; guarantee for the bank accepted notes of RMB50,000,000.00; b. South-western Military
Industry Co., Ltd. has provided guarantee to the Company and subsidiaries for the short-term loan of RMB90,000,000.00,
the long-term loan of RMB72,000,000.00, and bank accepted notes of RMB235,000,000.00.
3. Receivable and payables due with related parties
Name of the parties June 30, 2010 December 31, 2009
Amount Amount
Notes receivable
Jianxing Machinery 900,000.00
Changan Auto
Account receivable
Jianshe Yamaha 36,562,500.00 36,368,400.00
Pingshan Taikai 89,404.00
Changan Auto 48,287,681.82 25,478,579.53
Other account receivable
Jianshe Industry
Fuyeda
Chongqing Yamaha 7,957,927.72 713,331.07
Account payable
Jianshe Machinery
Jianshe Industry
Jianxing Machinery 1,339,833.41 276,183.82
Pingshan Taikai 10,955,004.88 10,832,191.65
Chongqing Yamaha 39,393,173.02
407,152.48
Chongqing Fuda Property Management Co., Ltd. 96,804.55
Qiantai Industry 6,636,860.50
Chongqing Jianshe Industry & Trade Co., Ltd. 123,040.31
Sichuan Huachuan Yamaha Motorcycle Parts Co., Ltd. 1,133,236.96
Tongsheng Construction 3,263,222.84
Notes payable
Jianshe Industry
Other account payable
Jianxing Machinery 9,214.90
Fuyeda 87,119.84 1,587,853.79
Chongqing Yamaha 1,723,340.52
Jianshe Industry 30,337,477.86 8,252,992.39
Yunlong Co. 1,723,340.52
Jianxing Rubber 5,930,880.72
XI. Post balance sheet issues
No post-balance-sheet issue to be disclosed.建设摩托 Interim Report 2010
56
VIII. Documents Ready for Inquiring
(I) Interim Report carried with personal signature and seal of the Chairman of the Board;
(II) Financial report with the signature and seal of the legal representative, CFO, and accounting manager of the
Company.
(III) All of the documents have disclosed by Securities Times and Hong Kong Commercial Daily.
(IV) The Articles of Association of the Compay
Chongqing Jianshe Motorcycle Co., Ltd.
August 4, 2010
