Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Chongqing Jianshe Vehicle System Co., Ltd.
2020 Annual Report
2021-017
April 2021
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
I. Important Prompts, Table of Contents, and Definitions
The Board of Directors, The Supervisory Committee, the supervisors 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.Yan Xuechuan, The Company leader, Mr.Tan Mingxian, the Financial Officer, Ms.Niu Yanli, the manager of
accounting department, hereby declare: the truthfulness and completeness of the Financial Report are guaranteed.
Other directors attending the Meeting for annual report deliberation except for the followed:
The name of director who did The name of director who was
Title for absent director Reasons for absent
not attend the meeting in person authorized
Yu Jiang Director Business trip Zhou Yongqiang
Zhang Di Director Business trip Dong Qihong
Prospective statements carried in this report, such as business plans for future are not constituting any substantial
commitment to the investors. Please be cautious to the risks. This report is prepared both in English and Chinese.
When there is any conflict in understanding, the Chinese version shall prevail.
The company had concretely described the existed factors of risks of the company in the report, of which please
refer to the contents in the Report of directors concerning the possible facing risk factors in the company’s future
development. The company’s business plan and business goal of the year do not represent the 2021-annual
earnings forecast made by the company, hence whether those can be realized depending on many factors such as
the market circumstance and the extent of hard working of the management team, thus there is a large extent of
uncertainty, please be aware of the investment risks.
The Company will not distribute cash dividend or bonus shares, neither capitalizing of common reserves for the
report period.
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Table of Contents
I.Important Notice, Table of contents and Definitions
II. Basic Information of the Company and Financial index
III. Outline of Company Business
IV. Management’s Discussion and Analysis
V. Important Events
VI. Change of share capital and shareholding of Principal Shareholders
VII. Situation of the Preferred Shares
VIII. Information about convertible corporate bonds
IX. Information about Directors, Supervisors and Senior Executives
X. Administrative structure
XI. Corporate Bond
XII. Financial Report
XIII. Documents available for inspection
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Definition
Terms to be defined Refers to Definition
Company, the Company, Jianmo Stock, Jianshe
Refers to Chongqing Jianshe Vehicle System Co., Ltd.
Vehicle B
Shenzhen North Jianshe Motorcycle Co., Ltd. (predecessor of the
Shenjianmo Refers to
Company)
Chongqing Jianshe Motorcycle Co., Ltd. (predecessor of the
Jianmo B Refers to
Company)
China Military Equipment Group Co., Ltd. (China Southern
Military Equipment Group（Southern Group） Refers to
Industry Group Co., Ltd.)
Military Finance Co. Refers to Military Equipment Group Finance Co., Ltd.
Southern Motorcycle Refers to Chongqing Southern Motorcycle Co., Ltd.
Chongqing Jianshe Industry Co., Ltd. – former State-owned
Jianshe Industry Refers to
Jianshe Machinery Factory, Jianshe Industry (Group) Co., Ltd.
Jianshe Group Refers to Jianshe Industrial (Group) Co., Ltd.
Jianshe Mechanical and Electric Refers to Chongqing Jianshe Mechanical and Electric Co., Ltd.
HANON,KOREA HANON Refers to Korea Hanon System Co., Ltd.
Chongqing Jianshe HANON Automobile Termal Management
Jianshe HANON Refers to
System Co., Ltd.
China Jialing Refers to China Jialing Industry Co., Ltd. (Group)
Jinan Qingqi Refers to Jinan Qingqi Motorcycle Co., Ltd.
Changan Auto Refers to Chongqing Changan Automobile Co., Ltd.
Yunnan Xiyi Refers to Yunnan Xiyi Industrial Co., Ltd.
Luoyang Northern Refers to Luoyang Northern Enterprise Group Co., Ltd.
Vehicle air conditioner Refers to Chognqing Jianshe Automobile Air-conditioner Co., Ltd.
Import & Export Co. Refers to Chongqing Northern Jianshe Import & Export Co., Ltd.
Shanghai Jianshe Refers to Shanghai Jianshe Motorcycle Co., Ltd.
Chongqing Jianya Refers to Chongqing Jianshe YAMAHA Motorcycle Co., Ltd.
Zhuzhou Jianya Refers to Zhuzhou Jianshe YAMAHA Motorcycle Co., Ltd.
Pingshan Taikai Refers to Chongqing Pingshan Taikai Carburetor Co., Ltd.
South Air International Refers to South Air International Co., Ltd.
Minsheng Logistics Refers to Chongqing Changan Minsheng APLL Logistics Co., Ltd.
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
The company has made an agreement to sale the 100% stake of
Jianshe Mechanical and Electric Company-the company’s
Major asset restructuring Refers to
subsidiary funded by the liabilities and the motorcycle business
related assets held by the company to Military Equipment Group.
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
II. Basic Information of the Company and Financial index
Ⅰ.Company Information
Stock ID Jianshe Vehicle B Stock Code 200054
Stock Exchange Listed Shenzhen Stock Exchange
Company Name in Chinese 重庆建设汽车系统股份有限公司
Short form of Company Name
建车 B
in Chinese
Company Name in English Chongqing Jianshe Vehicle System Co., Ltd
Short form of Company Name
JSVS-B
in English
Legal representative Yan Xuechuan
Registered address No.1 Jianshe Road, Huaxi Industrial Zone, Ba’nan District, Chongqing
Postal code of the Registered
400054
Address
Office Address No.1 Jianshe Road, Huaxi Industrial Zone, Ba’nan District, Chongqing
Postal code of the office
400054
address
Internet Web Site http://www.jianshe.com.cn
E-mail cqjsmc@jianshe.com.cn
Ⅱ.Contact person and contact manner
Secretary of the Board Representative of Stock Affairs
Name Zhang Hushan Li Wenling
No.1 Jianshe Road, Huaxi Industrial Zone, No.1 Jianshe Road, Huaxi Industrial Zone,
Address
Ba’nan District, Chongqing Ba’nan District, Chongqing
Tel. 023-66295333 023-66295333
Fax. 023-66295333 023-66295333
E-mail. cqjsmc@jianshe.com.cn cqjsmc@jianshe.com.cn
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Ⅲ. Information disclosure and placed
Newspapers selected by the Company for information
Securities Times and Hongkong Commercial Daily.
disclosure
Internet website designated by CSRC for publishing
http://www.cninfo.com.cn
the Annual report of the Company
The place where the Annual report is prepared and
Secretarial office of the Board
placed
Ⅳ.Changes in Registration
Organization Code 915000007474824231
From 1995 to 2015, the Company was mainly engaged in the production and sales of
motorcycles. In 2015, the company implemented the major asset restructuring, stripped the
Changes in principal business
main assets and liabilities involved in the motorcycle business, completed the structural
activities since listing (if any)
adjustment of the main business. Since 2015, it has been mainly engaged in the production
and sales of automotive air-conditioning compressors.
(a) The company was set up by Jianshe Group and China North Industries Corp Shenzhen
Company in July 1995, of which the Jianshe Group was the company’s controlling
shareholder that holds 71.13% stake of the company.
(b) On August 31, 2005, the 71.13% stake of the company held by Jianshe Group was
transferred to Military Equipment Group in an agreement, thus the Military Equipment Group.
has become the company’s controlling shareholder.
On March 2, 2016, according to Agreement of Share Transfer in Zero Price signed between
Changes is the controlling Military Equipment Group and Jianshe Mechanical and Electric, Military Equipment Group
shareholder in the past (is any) shall transfer its 71.13% stake of the company to Jianshe Mechanical and Electric in zero
price, thus the Jianshe Mechanical and Electric will become the company’s controlling
shareholder.
(d) On December 20, 2018, according to the Stock Rights Transfer Agreement of State-owned
Listed Company signed by Jianshe Mechanical and Electric
and Military Equipment Group , Jianshe Mechanical and Electric will hold 71.13% of the
company's equity, and the agreement will be transferred to Military Equipment Group , which
will become the controlling shareholder of the company.
Ⅴ. Other Relevant Information
CPAs engaged
Name of the CPAs Zhongxingcai Guanghua Certified public Accountants LLP.
Office address A24, 22/F,No.2 Fuchengmenwai Street, Xicheng District, Beijing
Names of the Certified Public Accountants as
Fan Rui, Zhang Weidong
the signatories
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
The sponsor performing persistant supervision duties engaged by the Company in the reporting period.
□ Applicable √ Not applicable
The Financial advisor performing persistant supervision duties engaged by the Company in the reporting period
□ Applicable √ Not applicable
Ⅵ.Summary of Accounting data and Financial index
Indicate by tick mark whether the Company needs to retroactively restate any of its accounting data.
□Yes √No
Changed over last
2020 2019 2018
year（％）
Operating revenue(Yuan) 740,851,845.25 791,487,434.18 -6.40% 971,804,000.23
Net profit attributable to the shareholders
1,415,942.45 -121,128,719.93 -101.17% 10,543,247.05
of the listed company（Yuan）
Net profit after deducting of
non-recurring gain/loss attributable to the -44,041,022.22 -119,395,985.23 -63.11% 9,074,662.19
shareholders of listed company（Yuan）
Net Cash flow generated by business
165,013,126.67 13,414,357.42 1,130.12% 162,824,513.55
operation（Yuan）
Basic earning per share(Yuan/Share) 0.012 -1.0147 -101.18% 0.088
Diluted gains per share(Yuan/Share) 0.012 -1.0147 -101.18% 0.088
Net asset earning ratio（%） 0.82% -52.05% -101.58% 3.66%
End of Changed over last
End of 2020 End of 2018
2019 year（％）
Gross assets（Yuan） 1,186,697,453.77 1,190,147,356.58 -0.29% 1,461,770,573.54
Net assets attributable to shareholders of
173,588,673.06 172,172,730.61 0.82% 293,301,450.54
the listed company（Yuan）
The lower of the company’s net profit before and after deduction of non-recurring gains and losses in the most
recent three fiscal years is negative, and the audit report of the most recent year shows that the company’s ability
to continue operations is uncertain
□Yes √ No
The lower of the net profit before and after non-recurring gains and losses is negative
√Yes □ No
Items 2020 2019 Notes
Operating revenue(Yuan) 740,851,845.25 791,487,434.18 Sales revenue
Rental income, sales materials,
Operating revenue deduction
9,280,483.94 10,292,797.31 waste income, power and
amount( yuan)
energy income
Amount after deduction of 731,571,361.31 781,194,636.87 Sales revenue
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
operating revenue(yuan)
VII.The differences between domestic and international accounting standards
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable□√ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS
(International Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting rules and
Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable□√ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign
accounting rules or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VIII.Main Financial Index by Quarters
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating revenue 159,386,309.82 175,203,952.03 202,858,501.83 203,403,081.57
Net profit attributable to the
-24,237,509.94 -10,457,910.38 40,472,240.13 -4,360,877.36
shareholders of the listed company
Net profit after deducting of
non-recurring gain/loss attributable
-24,329,373.91 -10,168,757.58 -2,059,817.75 -7,483,072.98
to the shareholders of listed
company
Net Cash flow generated by
21,163,192.63 51,958,701.35 47,434,377.12 44,456,855.57
business operation
Whether significant variances exist between the above financial index or the index with its sum and the financial
index of the quarterly report as well as semi-annual report index disclosed by the Company.
□ Yes √No
IX. Items and amount of non-current gains and losses
√Applicable □Not applicable
In RMB
Items Amount (2020) Amount (2019) Amount (2018) Notes
Non-current asset disposal gain/loss(including the
-448,967.59 -3,068,753.15 784,500.48
write-off part for which assets impairment provision is
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
made)
Government subsidies recognized in current gain and
loss(excluding those closely related to the Company’s 4,466,559.88 1,057,774.93 1,960,750.00
business and granted under the state’s policies)
The investment cost of the enterprise to obtain
subsidiaries and joint ventures which is less than the
42,924,165.03
fair value of the identifiable net assets of the investee
when the investment is obtained
Switch back of provision for depreciation of account
receivable and contractual assets which were singly 88,468.57
taken depreciation test
Other non-operating income and expenditure except for
-1,496,366.67 278,243.52 -429,537.06
the aforementioned items
Less: Influenced amount of income tax 76,894.55 251,064.39
Influence on minority shareholders’ equity (after tax) 596,064.17
Total 45,456,964.67 -1,732,734.70 1,468,584.86 --
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Compaines Offering their Securities to the Public-Non-recurring Gains and Losses and
its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure
for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as
recurring gains and losses, it is necessary to explain the reason.
□ Applicable √ Not applicable
None of Non-recurring gain /loss items recorgnized as recurring gain /loss/item as defined by the information
disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period.
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
III. Outline of Company Business
Ⅰ.Main Business the Company is Engaged in During the Report Period
The Company shall comply with the disclosure requirements of Shenzhen Stock Exchange Industry Information
Disclosure Guidelines No.16-Listed Companies Engaged in Auto Manufacturing-related Business
The company engages mainly in production and sales of the vehicle air compressor including the vane iron
and aluminous compressor, piston swash-plate fixed discharge rate compressor, piston swash-plate variable
discharge rate compressor and motor compressor (with the discharge rate from 18cc to 480cc), has been awarded
“China Famous Brand”, “High-quality Product of French Technological Quality Surveillance Evaluation
Commission” and “China Recommended Product for Entry into WTO”, etc. for products and has the strategical
cooperative partners including the leading production and sales volume in terms of finished automobile such as
PEUGEOT , Great Wall Motors ,Chanan Auto, Geely Auto and Dongfeng Nissan , etc.
Ⅱ.Major Changes in Main Assets
1.Major Changes in Main Assets
Main assets Major changes
Equity assets The Company's shareholding Pingshan Taikai increased from 50% to 100%.
2. Main Conditions of Overseas Assets
□ Applicable √Not applicable
III. Analysis On core Competitiveness
The Company shall comply with the disclosure requirements of Shenzhen Stock Exchange Industry Information
Disclosure Guidelines No.16-Listed Companies Engaged in Auto Manufacturing-related Business
R&D capability: The company is the pioneer of new energy electric compressors in China and the only R&D
base of rotary vane compressors in China. It has the largest and most comprehensive experimental testing center
for automotive air conditioning compressors in Southwest China. It has three scientific and technological
innovation platforms: Enterprise Technology Center, Automotive Thermal Management System Engineering
Technology Research Center and Key Laboratory of Automotive Air Conditioning Compressor, and has a
postdoctoral workstation; It has 75 R&D teams, including 4 senior engineers, 8 senior engineers and 1 external
expert; It has imported more than 50 sets of advanced equipment for reliability test, system test, performance test,
NVH experimental test, etc. from abroad, which worth more than RMB 50 million; It has 1 national key new
product and 2 major new products in the city, all of which are high-tech products; It owns more than 150 patents,
including more than 30 invention patents.
Including:
Test and analysis ability: It has strong ability in testing and analysis of automobile air conditioning compressor,
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
testing and analysis of mechanical vibration and noise of automobile air conditioning compressor and whole
vehicle, testing and analysis of automobile air conditioning system, etc., and has built industry-leading NVH test
and analysis ability
Trial-production processing ability: It has strong trial-production processing ability, forming an integrated
processing from CAD → CAE → CAM, with a production cycle of new product prototype of only about 7 days.
Manufacturing capacity: it has domestic first-class high-precision parts manufacturing base, Chongqing
municipal digital workshop, with an annual output of 2.1 million compressors; It has more than 40 parts
machining production lines, more than 260 sets of high-precision and high-quality processing equipment, and 9
general assembly lines with equipment value of more than RMB 650 million, of which more than 80% of the
equipment is imported from Japan, the United States, Germany, Switzerland, South Korea and other countries;
With a machining and assembly accuracy of micron, MARPOSS is largely used for online inspection, and the
machining accuracy and assembly automation are at the leading level in China.
Quality assurance ability: The company always adheres to the tenet of "quality first, customer foremost", and
is committed to carrying out quality work in all links of the company, and constantly improving product quality,
service quality and quality-price ratio. The company has continuously improved its management ability and
actively assumed social responsibility. It has passed IATF 16949 certified by DNV, an international authoritative
certification body, as well as OHSAS18001 and ISO14001 management system certification, and is in line with
international manufacturers. It has introduced general QSB+ quality management system, Ford Q1 system,
Changan QCA system and Nissan GK on-site management concept to continuously improve its management
level.
Product pedigree: On the basis of introducing advanced technology from the world, the company actively
carries out independent innovation. After years of development, its product pedigree and technical system have
become increasingly complete; Including rotary vane compressor, fixed displacement and variable displacement
of swash plate and electric compressor with complete intellectual property rights, forming five product platforms
of "rotary vane iron/aluminum, piston fixed/variable and electric"; and the products cover a displacement from
18CC to 480CC.
IV. Management’s Discussion and Analysis
I. General
II. In 2020, challenged the sudden COVID-19 outbreak, in order to win the final battle of the 13th Five-Year
Plan, the company took many measures to actively cope with the adverse effects brought by the epidemic and
basically achieved the annual target. In the whole year, 1.943 million sets of automotive air-conditioning
compressors were produced and 1.861 million sets were sold, which decreased by 4.88% and 7.24%
respectively compared with the same period of last year. The sales of automotive air-conditioning
compressors achieved 93.05% of the annual budget.
(I) Market development
According to the "key account management" model, with focus on projects, promotion of new products and
strengthening of expansion, the sales volume of key customers increased steadily. Changan, Geely and overseas
UCM markets increased by 43.4%, 14.7% and 51.1% respectively year-on-year. The monthly sales volume of
Chang'an new projects S201 and S202 exceeded 10,000, 24,000 orders were delivered in Northern Projects, the
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
offline market increased by 52.3% year-on-year, and the monthly demand of French PSA recovered to the same
level year on year.
First, strive for the 9 new market projects, and the 100% completion rate of 30 R&D projects; Second, achieve
mass production for 20 market projects, and reach more than 69% contribution rate of new products; Third,
complete the development of key new product projects such as 09D and 11D, and a small batch of mobile powder
metallurgy basic materials project has been realized, and new projects such as Changan B316 and S111 have been
carried out to realize batch supply.
(II) Product R&D
First, strive for the 9 new market projects, and the 100% completion rate of 30 R&D projects; Second, achieve
mass production for 20 market projects, and reach more than 69% contribution rate of new products; Third,
complete the development of key new product projects such as 09D and 11D, and a small batch of mobile powder
metallurgy basic materials project has been realized, and new projects such as Changan B316 and S111 have been
carried out to realize batch supply.
(III) Cost control
First, carry out special actions to improve the quality of economic operation, promote the cost control of the
whole value chain and product life cycle, coordinate the linkage between cost and operating income, strengthen
the cost efficiency analysis, and achieve a savings value of RMB 31.37 million; Second, carry out "two funds"
settlement follow-up, and accelerate the disposal of inefficient and ineffective assets. The accounts receivable
decreased by RMB 10.26 million compared with the beginning of the year.
(IV) Quality management
First, vigorously promote the construction of "1+N" quality system, and successfully pass Chang'an QCA2.0
and Geely "3A" supplier system certification on the basis of IATF16949 system audit; Second, strengthen the
quality cost control and carry out the activities of "Quality centered" and "Priority in reduction" in depth, with the
product quality performance fully affirmed by customers, winning the China Chang'an Quality Red List for 12
consecutive quarters.
(V) Safety and environmental protection
First, solidly promote the company's three-year special rectification campaign for work safety, vigorously
carry out major rectification for security and confidentiality work, and ensure no major safety accidents, no public
security incidents and no leakage incidents occurred throughout the year; Second, successfully pass the
certification of double standard system of environmental and occupational health and safety management and
standardized acceptance of fire safety.
The Company shall comply with the disclosure requirements of Shenzhen Stock Exchange Industry Information
Disclosure Guidelines No.16-Listed Companies Engaged in Auto Manufacturing-related Business
(I) External environment analysis
1. Macro-environment
The Fifth Plenary Session of the 19th CPC Central Committee defined the general tone of striving for stability,
called for unswervingly implementing the new innovative, green, open and sharing development concept, and put
forward a new development pattern centered by domestic circulation, with international and domestic double
circulation promoted each other. Affected by the pandemic, the GDP growth in 2020 hit a new low in the past 20
years, with a growth rate of only 2.3%, which is expected to fluctuate between 5.0% and 6.0% during the whole
14th Five-Year Plan period. Meanwhile, with the outbreak of the pandemic, economic globalization has
encountered a setback, state protectionism and unilateralism have prevailed, geopolitical risks have risen, the
international environment is extremely severe, and uncertainties have increased significantly.
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
2. Consumption trends:
In recent years, the growth rate of retail sales of consumer goods in China has slowed down, the consumption
structure has changed to service consumption, and new formats such as online consumption have remained active.
However, the original market still maintains its vitality, the consumer groups are diversified, and the stratification
phenomenon has become increasingly prominent, which has brought differentiated brand demand. The huge
impact of the COVID-19 on the economy will directly affect the operation of many enterprises and the income of
employees. The decline of consumption willingness caused by economic pressure and price fluctuation will be
very obvious in one or two years.
3. Policy environment
Policies such as liberalizing the share ratio of joint ventures, double points, environmental protection and tariff
reduction will further increase the operating pressure and accelerate industrial adjustment, optimization and
upgrading. The Medium-and Long-Term Development Plan of Automobile Industry puts forward that automobile
development should change from scale and speed to quality and benefit; Break through key areas of new energy
vehicles and lead transformation and upgrading; Consolidate the foundation of auto parts and encourage the
development of innovative industrial clusters of parts and components. With the convening of the Fifth Plenary
Session of the 19th CPC Central Committee, the reform of state-owned enterprises has been speeding up, and the
pace is bound to be further accelerated; "Liberalization" is the general trend, and domestic car companies need to
adapt to market competition without special policy protection.
(II) Industry situation analysis
1. Overall situation of automobile industry
In 2019, the pressure on China's automobile industry increased further, and the sales volume decreased by 8.2%
year on year. In 2020, the sales volume decreased by 1.9% year on year, and the industry performance was much
better than expected. COVID-19 has a great impact on the industry in the short term, and will accelerate the
survival of the fittest in the long term.
In 2020, the top ten car companies in the industry are with a total sales of 22.65 million cars, with a
year-on-year decrease of 2.3%, accounting for 89.5% of the total sales, and the market concentration is still high.
The production and sales of passenger cars are lower than that of the whole industry, and the sales volume
decreased by 6% year on year, among which the self-owned brands decreased by 8.1% year on year.
Based on the level of car ownership per 1,000 people in China, the demand for consumption upgrading and the
development of technology, in the long run, China's automobile industry, especially passenger cars, still has
certain development potential for countries with similar population and geographical characteristics.
2. New energy automobile industry situation
After years of cultivating the whole industrial chain, China's new energy vehicles have gradually matured in
various links, diversified products have emerged constantly, and the use environment has been gradually improved.
To cope with the epidemic and promote consumption, the subsidy policy will continue until 2022.
New energy is the strategic direction firmly supported by the state, and incorporation of charging piles into
new infrastructure has become the focus of national infrastructure construction. The New Energy Automobile
Industry Development Plan proposes that by 2025, the sales volume of new energy vehicles will reach more than
20%, and the sales volume is expected to reach 6 million vehicles. In the medium and long term, due to various
favorable factors, the new energy market can still maintain medium and high-speed growth.
At present, the sales of new energy passenger cars are mainly in the first-tier and second-tier cities and cities
with restricted issuance of new car licenses, but the sales of cities with non-restricted issuance of new car licenses
are gradually increasing. The domestic new energy passenger car market has become a competition among three
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Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
forces, and the domestic market dominated by traditional independent brands is gradually being broken by foreign
brands and new forces of car-manufacturing. In the next five years, industrial competition will continue to
intensify, policy-driven will gradually become "policy+market-driven", and technology and cost control will
become the key to competition.
3. Situation of auto parts industry
The auto parts industry has developed rapidly. According to the 2018 Research on the Development of China's
Auto Parts Industry by the Ministry of Industry and Information Technology, there are more than 100,000 auto
parts enterprises in China. In 2018, the total output value of parts industry will exceed RMB 4 trillion, which is
faster than that of the whole vehicle, and it is expected to exceed RMB 5 trillion in 2021. However, in recent years,
the profit level of the spare parts sector has dropped rapidly, and the new energy parts have gradually become
investment hotspots.
4. Industry situation of automobile thermal management system
With the continuous improvement of energy consumption requirements and the development of new energy
vehicles, new products of automobile thermal management, such as heat pumps, electric compressors and
electronic pump valves, have emerged, attracting a large amount of investment in technology and capital,
accelerating the process of mergers and acquisitions in the industry, and showing an obvious trend of coordinated
development.
5. Compressor industry analysis
At present, there are no absolute advantages and disadvantages of compressor products with various technical
structures in the market. From the perspective of the whole vehicle, the compressor module focuses on matching.
Although the non-electric compressor products will still maintain a large scale potential in the next few years due
to the huge base number of fuel vehicles, the proportion of fixed displacement compressors will gradually decline
due to the rapid development of new energy and the anti-driving of oil consumption regulations. Following the
"going out" of the independent brand main engine factory and the "globalization" of foreign brands, the shifting
trend of the fixed displacement compressor towards overseas is obvious, which is bound to bring opportunities for
the company's fixed displacement compressor to stabilize its scale, prolong its life and improve its quality.
The automotive air conditioner compressor industry keeps up with the development of automobile industry,
and its share concentration is further expanded, with the top four accounting for about 70% of the total.
The design capacity of the company's fixed displacement compressors is 2 million units, and the actual output
in 2020 is 1.943 million units, with a capacity utilization rate of 97.2%; The design capacity of electric and large
displacement compressors is 100,000 units, and the actual output in 2020 is 9,869 units; The design capacity of
the company's joint venture Jianse HANON is 400,000 units, with an actual output of 389,000 units in 2020, and a
capacity utilization rate of 97%. The company ranks fourth in the industry with the output of 2 million
compressors (in 2019), with a market share of about 10%.
Vehicle manufacturing, production and operation during the reporting period
□ Applicable √Not applicable
Production and operation of auto parts during the reporting period
√ Applicable □ Not applicable
Output Sales volume
This reporting Increase or This reporting Increase or
Same period last Same period last
period ('0,000 decrease period ('0,000 decrease
year ('0,000 units) year ('0,000 units)
units) compared with units) compared with
15
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
last year last year
By part category
Automotive air
conditioner 194 204 -4.88% 186 201 -7.24%
compressor
Area
Domestic 140 120 17.03% 118 116 1.77%
Overseas 54 84 -36.01% 68 84 -19.66%
Explanation of the reasons for the year-on-year change of more than 30%
√ Applicable □ Not applicable
This year, the production of overseas products decreased by 36.01% compared with the previous year. The
main reason is that: due to the influence of overseas pandemic, the factories owned by the company's major
customers have been closed and shut down for a long time, which reduces the demand for the company's product
orders.
Parts sales model
Key account sales mode: according to the customer's production demand, the company will ship the goods to
the designated or cooperative third-party logistics company, and the third-party logistics company will be
responsible for warehousing and distribution services. Every month, the customer issues a credit notice according
to the actual consumption of the production plan, and the salesman issues an invoice notice according to the
customer's credit notice in combination with the customer's consumption, contract unit price and other information,
and the Finance Department issues an invoice to confirm the sales revenue.
Customer sales mode of cash before delivery: according to customer demand and related billing information,
after the customer pays and confirms that the payment has been received, the sales staff delivers goods according
to the unit price of the sales contract and the quantity required by the customer, and issues a billing notice, and the
Finance Department issues an invoice to confirm the sales revenue.
Customer sales model in after-sales market. Sales staff deliver goods to customers according to the contract
and customer's requirements. After reaching the time node agreed in the contract, they will issue an invoice notice
according to the contract unit price and shipment quantity agreed with customers, and the Finance Department
will issue an invoice to confirm the sales revenue.
The sales model this year has not changed compared with previous years.
The company conducts auto finance business
□ Applicable √Not applicable
The company conducts new energy vehicle related business
□ Applicable √Not applicable
Subsidy income of new energy vehicles
III. Main business analysis
1. General
This year, the company completed a production of 1.943 million units and sold 1.861 million units for its
main products, automotive air conditioner compressors, with a year-on-year decrease of 4.88% and 7.24%
16
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
respectively. The main business income was RMB 732 million, with a year-on-year decrease of 6.35%.
From the regional perspective, the domestic sales reached 1.18 million units, with a year-on-year increase of
1.77%, and the sales revenue reached RMB 505 million, with a year-on-year increase of 0.21%. Domestic sales
revenue accounted for 69.1% of the company's main business income. Affected by the overseas epidemic, the
company's major customers closed their factories, with a long shutdown, which reduced the demand for the
company's product orders. The company sold 680,000 units in foreign trade throughout the year, with a
year-on-year decrease of 19.66%, and realized a sales income of RMB 226 million, with a year-on-year decrease
of 23.83%. Foreign trade sales accounted for 30.9% of the company's main business income.
From the perspective of customer structure: the top five customers of the company, namely PSA (Peugeot),
Changan Automobile, Great Wall Motor, Geely Automobile and Proton Malaysia, purchased 1.585 million sets of
vehicle air conditioning compressors from the company in the whole year, accounting for 85.2% of the total
purchases of customers. The purchase amount is RMB 561 million, accounting for 75.67% of the total purchase
amount of customers.
See the change of consolidation scope in Note VIII of the Audit Report for details.
2. Revenue and cost
(1)Component of Business Income
In RMB
2020 2019
Increase /decrease
Amount Proportion Amount Proportion
Total operating
740,851,845.25 100% 791,487,434.18 100% -6.40%
revenue
On Industry
Auto and Motorcycle
731,571,361.31 98.75% 781,194,636.87 98.70% -6.35%
parts
Other 9,280,483.94 1.25% 10,292,797.31 1.30% -9.84%
On products
Auto and Motorcycle
731,571,361.31 96.85% 781,194,636.87 98.70% -6.35%
parts
Other 9,280,483.94 1.25% 10,292,797.31 1.30% -9.84%
On Area
Anhui 17,404,019.16 2.35% 5,648,549.94 0.71% 208.11%
Beijing 8,737,415.97 1.18% 229,982.31 0.03% 3,699.17%
Fujian 92,194.69 0.01% 109,902.71 0.01% -16.11%
Guangdong 4,965,172.47 0.67% 4,807,767.16 0.61% 3.27%
Guangxi 2,143,214.13 0.29% 905,058.02 0.11% 136.80%
Hebei 3,295,014.18 0.44% 29,663,462.04 3.75% -88.89%
Henan 4,894,181.39 0.66% 3,982,620.62 0.50% 22.89%
17
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Hubei 30,883,712.83 4.17% 60,349,900.80 7.62% -48.83%
Jilin 65,486.74 0.01% 14,018.93 0.00% 367.13%
Jiangsu 9,232,764.33 1.25% 12,008,002.96 1.52% -23.11%
Jiangxi 6,328,746.31 0.85% 4,425,642.72 0.56% 43.00%
Liaoning 0.00% 121,822.84 0.02% -100.00%
Shzndong 1,955,016.56 0.26% 2,198,370.17 0.28% -11.07%
Shannxi 505,176.97 0.07% 178,424.79 0.02% 183.13%
Shanghai 4,099,161.46 0.55% 2,634,774.33 0.33% 55.58%
Sichuan 113,828.80 0.02% 72,993.30 0.01% 55.94%
Tianjing 2,704,426.60 0.37% 24,788,007.09 3.13% -89.09%
Yunnan 40,912.43 0.01% 109,507.58 0.01% -62.64%
Zhejiang 96,149,564.48 12.98% 84,222,867.72 10.64% 14.16%
Chongqing 311,883,789.99 40.10% 247,856,310.61 31.32% 25.83%
Ningxia 0.00% 40,460.18 0.01% -100.00%
Shanxi 0.00% 0.00%
Hunan 0.00% 17,072.84 0.00% -100.00%
Xinjiang 0.00% 17,309.74 0.00% -100.00%
Overseas 226,077,561.82 30.52% 296,791,807.47 37.50% -23.83%
Other 9,280,483.94 1.25% 10,292,797.31 1.30% -9.84%
(2)Situation of Industry, Product and District Occupying the Company’s Business Income and Operating Profit
with Profit over 10%
√ Applicable □Not applicable
In RMB
Increase/decrease Increase/decrease Increase/decrease
of revenue in the of business cost of gross profit
Gross profit
Turnover Operation cost same period of over the same rate over the same
rate(%)
the previous period of period of the
year(%) previous year (%) previous year (%)
On Industry
Auto and Motorcycle
731,571,361.31 634,912,358.18 13.21% -6.35% -10.08% 3.60%
parts
On products
Auto and Motorcycle
731,571,361.31 634,912,358.18 13.21% -6.35% -10.08% 3.60%
parts
On Area
Zhejiang 96,149,564.48 67,278,049.97 30.03% 14.16% -6.84% 15.77%
18
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Chongqing 311,883,789.99 287,136,921.09 7.93% 25.83% 23.90% 1.43%
Overseas 226,077,561.82 214,634,628.96 5.06% -23.83% -22.45% -1.69%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main
business based on latest on year’s scope of period-end.
□ Applicable √Not applicable
(3)Whether the Company’s Physical Sales Income Exceeded Service Income
√ Yes □ No
Classification Items Unit 2020 2019 Changes
Sales Ten thousand sets 186.11 200.64 -7.24%
Vehicle air
Production Ten thousand sets 194.34 204.32 -4.88%
conditioner
Stock Ten thousand sets 44.88 37.61 19.33%
Explanation for a year-on –year change of over 30%
□ Applicable √Not applicable
(4)Degree of Performance of the Significant Sales Contract Signed up to this Report Period
□ Applicable √Not applicable
(5)Component of business cost
In RMB
2020 2019
Increase/Decrease
Industry Items Proportion in the Proportion in the
Amount Amount (%)
operating costs (%) operating costs (%)
Industry Direct material 574,716,791.27 84.45% 639,565,240.68 86.38% -10.14%
Industry Fuel and energy 14,109,914.18 2.07% 13,818,518.98 1.87% 2.11%
Industry Staff salary 29,285,361.74 4.30% 37,031,277.32 3.32% -20.92%
Industry Manufacturing cost 62,454,453.65 9.18% 49,967,252.64 8.44% 24.99%
(6)Whether Changes Occurred in Consolidation Scope in the Report Period
√ Yes □ No
See the change of consolidation scope in Note VIII of the Audit Report for details.
(7)Relevant Situation of Significant Changes or Adjustment of the Business, Product or Service in the
Company’s Report Period
□ Applicable √Not applicable
(8)Situation of Main Customers and Main Supplier
Information of Main Customers
19
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Total sales amount to top 5 customers (Yuan) 560,605,371.61
Proportion of sales to top 5 customers in the annual sales(%) 75.67%
Proportion of the sales volume to the top five customers in the total sales to the
18.62%
related parties in the year
Information of the Company’s top 5 customers
No Name Amount(RMB) Proportion(%)
1 Customers1 189,908,593.38 25.63%
2 Customers2 137,981,912.02 18.62%
3 Customers3 104,929,247.78 14.16%
4 Customers4 95,295,514.30 12.86%
5 Customers5 32,490,104.13 4.39%
Total -- 560,605,371.61 75.67%
Other explanation :
√ Applicable □Not applicable
Chongqing Changan Automobile Co., Ltd., one of the top five customers, and its affiliated enterprises have an
associated relationship with the Company. The Company and its transactions, as routine related transactions, have
been submitted to the 2019 General Meeting of Shareholders for review and approval.
The company director, supervisor, senior executive, core technician and shareholder holding more than 5% .
Principal suppliers
Total purchase of top 5 Suppliers（Yuan） 310,473,706.08
Percentage of total purchase of top 5 suppliers In total annual purchase(%) 45.78%
Proportion of purchase amount from the top 5 suppliers in the total
0.00%
purchase amount from the related parties in the year
Information about the top 5 suppliers
No Name Amount（Yuan） Proportion
1 Anhui Haofang Electromechanics Co., Ltd. 153,372,252.68 22.61%
2 Chongqing Jinchen Machinery Manufacturing Co., Ltd. 50,204,323.80 7.40%
3 Chongqing Zhongkuo Machinery Co., Ltd. 48,364,788.77 7.13%
4 Chongqing Mingxin Machinery Manufacturing Co., Ltd. 30,128,384.39 4.44%
5 Chongqing Yujiang Die Casting Co., Ltd. 28,403,956.44 4.19%
Total -- 310,473,706.08 45.78%
Other explanation :
√ Applicable □ Not applicable
The company’s directors, supervisors, senior management personnel and key technical personnel have no direct or
indirect interests in the major suppliers of the above-said suppliers.
20
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
3.Expenses
In RMB
Increase/Decrea
2020 2019 Notes
se(%)
Sale expenses Mainly due to the decrease in staff
16,631,963.90 24,647,316.08 -32.52%
salaries, travel expenses and repair fees
Administration expenses Mainly due to the decrease in
69,410,916.79 92,590,185.22 -25.03%
employee salaries and repair costs
Financial expenses 22,486,373.84 21,295,046.18 5.59%
R & D expenses 15,283,965.69 14,231,114.36 7.40%
4.R& D Investment
√Applicable □Not applicable
In this year, the company completed R&D investment of RMB 15.28 million in projects such as "Research
on Multi-field Coupling Excitation Mechanism and Noise Optimization of Compressors", "Research on Energy
Consumption Estimation Method of Dynamic Parameter Measurement Compressors", "Research on Basic
Materials of Compressors", "Research on Compressor Order Noise", "14D Compressor R&D" and "Scroll Electric
Compressor R&D", accounting for 2.06% of operating income, with a year-on-year increase of 7.40%.
Situation of Research and Development Input by the Company
Increase/Decr
2020 2019
ease(%)
Number of Research and Development persons (persons) 68 76 -10.53%
Proportion of Research and Development persons 7.20% 7.36% -0.16%
Amount of Research and Development Investment ( Yuan) 15,283,965.69 14,231,114.36 7.40%
Proportion of Research and Development Investment of Operation Revenue 2.06% 1.80% 0.26%
Amount of Research and Development Investment Capitalization (Yuan) 0.00 0.00 0.00%
Proportion of Capitalization Research and Development Investment of
0.00% 0.00% 0.00%
Research and Development Investment
Notes to the year-on-year change of the relevant data
□ Applicable √Not applicable
The company has increased investment in R&D for electric compressors and aluminum machines.
□ Applicable √Not applicable
5.Cash Flow
In RMB
Items 2020 2019 Increase/Decrease(%)
21
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Subtotal of cash inflow received from
541,548,254.98 523,895,104.43 3.37%
operation activities
Subtotal of cash outflow received
376,535,128.31 510,480,747.01 -26.24%
from operation activities
Net cash flow arising from operating
165,013,126.67 13,414,357.42 1,130.12%
activities
Subtotal of cash inflow received from
61,457,531.55 32,361,387.79 89.91%
investing activities
Subtotal of cash outflow for
44,728,338.85 41,064,349.48 8.92%
investment activities
Net cash flow arising from investment
16,729,192.70 -8,702,961.69 -292.22%
activities
Subtotal cash inflow received from
1,079,339,590.72 1,332,782,411.58 -19.02%
financing activities
Subtotal cash outflow for financing
1,191,153,002.36 1,400,654,479.48 -14.96%
activities
Net cash flow arising from financing
-111,813,411.64 -67,872,067.90 64.74%
activities
Net increase in cash and cash
69,919,927.45 -63,160,804.24 -210.70%
equivalents
Notes to the year-on-year change of the relevant data
√Applicable □ Not applicable
The increase of net cash flow from operating activities is due to the change of payment method and the
increase of bill settlement this year.
The increase in net cash flow from investment activities is due to the merger of Pingshan Taikai and the
inflow of monetary funds this year.
The decrease in net cash flow from fund-raising activities is due to the repayment of loans.
The increase in net increase in cash and cash equivalents is due to the increase in net cash flow from
operating activities.
Notes to the big difference between cash flow from operating activities and net profit in the reporting year
□ Applicable√ Not applicable
IV. Analysis of Non-core Business
√ Applicable □Not applicable
In RMB
Proportion in total Sustainable (yes or
Amount Explanation of cause
profit no)
The operating loss of the Company's
Investment income -3,451,062.12 -180.17% Yes
joint venture Jianshe HANON.
22
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Provision for bad debts, reserve for
Impairment of
-9,953,007.03 -519.62% inventory to fall, reserve for No
assets
impairment of fixed asset
Non-operating Acquisition of 50% equity of Pingshan
41,077,989.97 2,144.55% No
income Taikai to realize profit
Non-operating
1,572,672.69 82.10% No
expenses
Credit impairment
-1,258,873.53 -65.72% No
losses
Ⅳ.Condition of Asset and Liabilities
1.Condition of Asset Causing Significant Change
In RMB
The company will implement the new financial instruments standards, new income standards or new lease
standards for the first time since 2020 and adjust and implement the relevant items of the financial statements at
the beginning of the year
Applicable
In RMB
End of 2020 End of 2019
Proportion Notes to the
Proportion in Proportion in
increase/dec significant
Amount the total Amount the total
rease change
assets(%) assets(%)
Monetary fund 159,343,241.47 13.43% 154,613,734.94 12.99% 0.44%
Accounts receivable 221,386,452.90 18.66% 231,648,218.97 19.46% -0.80%
Inventories 169,145,986.78 14.25% 146,318,458.60 12.29% 1.96%
Investment real
23,043,398.52 1.94% 71,928,994.28 6.04% -4.10%
estate
Long-term equity
186,213,719.02 15.69% 230,649,585.63 19.38% -3.69%
investment
Fixed assets 310,131,438.69 26.13% 278,885,442.43 23.43% 2.70%
Construction in
1,871,241.59 0.16% 3,858,269.05 0.32% -0.16%
process
Short-term loans 553,910,000.00 46.68% 422,280,000.00 35.48% 11.20%
2.Asset and Liabilities Measured by Fair Value
□Applicable √Not applicable
3. Restricted asset rights as of the end of this Reporting Period
23
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
The ending balance of monetary funds is RMB 80,032,987.92, which is the bank acceptance bill deposit and
time deposit, and is fund with restricted use.
Ⅴ.Investment situation
1. General
√ Applicable □Not applicable
Investments made in the Reporting Period
Investments made in the prior year (RMB) Increase/Decrease(%)
（RMB）
11,991,820.54 102,743,305.30 -88.33%
2.Condition of Acquiring Significant Share Right Investment during the Report Period
√ Applicable □Not applicable
In RMB
Target Main Investm Investm Shareh Capital Partner Investm Product Progres Predict Investm Litigati
compan busines ent way ent olding source ent type s to the ed ent on
y name s amount rate period balance revenue profit
sheet and Disclos
Disclos
date loss of ure
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the Index
current
period
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24
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
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Total -- -- 20.54 -- -- -- -- -- -- 0.00 -- -- --
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3.Situation of the Significant Non-equity Investment Undergoing in the Report Period
√ Applicable □ Not applicable
In RMB
Reasons
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25
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
n and 1.
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Total -- -- -- -- -- 0.00 0.00 -- -- --
0.00 0.00
4.Investment of Financial Asset
（1）Securities investment
□ Applicable √ Not applicable
No such cases in the Reporting Period
（2）Investment in Derivatives
□ Applicable √ Not applicable
No such cases in the Reporting Period
5.Application of the raised capital
□ Applicable √ Not applicable
No such cases in the Reporting Period
Ⅵ.Significant Asset and Right Offering
1.Situation of Significant Asset Sale
□ Applicable √ Not applicable
No such cases in the Reporting Period
2.Situation of Substantial Stake Sale
□ Applicable √ Not applicable
Ⅶ.Analysis of the Main Share Holding Companies and Share Participating Companies
√ Applicable □ Not applicable
Situation of Main Subsidiaries and the Joint-stock Company with over 10% net profit influencing to the Company
In RMB
Company Type Main business Registered Total assets Net assets Turnover Operating Net Profit
26
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
name capital profit
Air
Manufacturing 956,374,606.2 257,930,324. 698,617,790.
Subsidiari
Condition and sales of auto 160000000 1,907,706.73 1,255,544.45
es 9 07 63
air-conditioners
er Co.
Production and
Pingshan Shareholdi sales of USD 10 77,260,213.1 39,557,062.4
96,653,692.45 355,272.11 558,792.61
Taikai ng motorcycles and million 3 6
company parts
Production and
sales of
Shareholdi
Jianshe Automobile 611,735,482.8 369,310,719. 232,203,748. -12,338,039. -11,136,523.
ng 420000000
HANON Thermal Energy 8 26 88 78 51
company
Management
system
Acquirement and disposal of subsidiaries in the Reporting period
√ Applicable □Not applicable
Ways of acquisition and disposal of subsidiaries Impact on overall operation and
Name
during the reporting period performance
After the Company acquired 50% equity of the After the completion of the Company's
Chongqing Pingshan Taikai Pingshan Taikai, the Company holds 100% of acquisition, the merger this year increased
Carburetor Co., Ltd Pingshan Taikai equity, and Pingshan Taikai is the non-operating income by RMB 40.98
included into the consolidated statement. million.
Subsidiaries acquired and sold in the reporting period Note
□ Applicable √ Not applicable
VIII．Structured vehicle controlled by the Company
□ Applicable √ Not applicable
Ⅸ.Prospect for future development of the Company
(I) Opportunities and challenges of the development of the company
1. Opportunities
First, China has turned to a high-quality development stage, with broad market potential, strong development
resilience and long-term economic improvement. China puts innovation at the core of China's modernization drive,
vigorously promotes independent innovation capability, promotes the transformation and upgrading of traditional
industries, and strengthens the stability and competitiveness of industrial chain and supply chain, and will
introduce a series of preferential policies to promote scientific and technological innovation.
Second, the vehicle incremental market and spare parts stock market will drive the scale growth of parts
industry and bring new opportunities to domestic enterprises with comparative advantages. The penetration rate of
new energy vehicles has been accelerated, which has brought important development opportunities for the new
energy and heat management industry.
Third, the company has three municipal-level scientific and technological research and development
27
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
platforms, including national postdoctoral workstations and Chongqing Enterprise Technology Center, and has
strong independent R&D and cross-technology platform imitation research capabilities; The fixed displacement
compressor has mature technology, good product quality performance and high quality reputation and brand
influence; It has established a joint venture with Korea HANON, an internationally renowned automobile thermal
management enterprise, which broadened the introduction channels of thermal management system technology.
2. Challenges
First, the auto parts industry is faced with the dilemma of high technical threshold, large investment and
many technical routes in the four-trend transformation, which is compounded by many factors such as fluctuating
demand, rapid iteration of products, rising costs, tightening payment terms of main engine factories, and supply
chain security. The competition among enterprises is further intensified and the pressure for survival is enormous.
Second, from the perspective of the company itself, the company is with weak core competitiveness of products,
relatively simple compressor product structure, low gross profit margin, and high cost pressure; No breakthrough
has been formed yet in the electric compressor market; It is urgent to speed up the market development of variable
displacement compressors in joint ventures; It is with large historical liabilities and tight funds, but lacking in
effective financing ability and means.
(II) The 14th Five-Year Plan of the Company
With the vision of "building a first-class scientific and technological innovative enterprise with international
competitiveness", further promote the company's "1363" strategy, accelerate structural optimization according to
the guiding principle of "overall planning, distribution promotion, focusing on resources and innovating
mechanism", focus on innovation drive, deepen reform and adjustment, continuously improve management,
strengthen human security, strengthen party building, effectively improve operating efficiency, and push the
company's high-quality development to a new level.
1. Industry (product) layout
First, based on the main business. Continuously improve the competitiveness of traditional compressor
products, and stably maintain market share. Second, comprehensive upgrading and development. Vigorously
develop new energy businesses such as electric compressors and heat pump air conditioning systems to realize
industrial upgrading and development.
2. Planning objective
Development goal: Through independent development and capital integration, upgrade the full spectrum
thermal management products from compressor to air conditioning system and from fuel vehicle to electric
vehicle, and build a first-class scientific and technological innovation enterprise with international
competitiveness.
Business objective: Vigorously implement the three tough battles of "product innovation", "reform and
adjustment" and "turning losses into profits". By 2025, the sales volume of compressor products will be 2.5
million units (including 300,000 electric compressors), and the scale, benefit and efficiency will be doubled. The
industry will continue to develop and the business quality will continue to improve.
3. Major initiatives
(1) Focus on promoting the optimization and adjustment of industrial structure and promoting the
transformation and upgrading of the company.
First, build an industrial platform for thermal management of new energy vehicles and give full play to the
best utility of resources. Actively lay out heat pump air conditioning systems, stabilize the sales scale of fixed
displacement compressors, accelerate the breakthrough of electric compressor products, technology and market,
and strengthen the market expansion of variable displacement compressors. By 2025, the sales volume of electric
28
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
compressors, heat pump air conditioning systems and fixed displacement compressors will be 300,000 units,
50,000 units and 2.2 million units respectively, and the production and sales scale of joint venture variable
displacement compressors will be over 900,000 units. Second, stabilize the export motorcycle carburetor market,
vigorously develop the EFI system, and speed up product upgrading. By 2025, Pingshan Taikai will achieve sales
income of over RMB 200 million. Third, promote the technological upgrading of parts and components products
and move towards high-end manufacturing. By 2025, the income of casting machine parts will be over RMB 100
million.
(2) Focus on promoting key core technology innovation and promoting industrial technology upgrading.
Deepen the technical research of fixed displacement compressor products, continuously explore the technical
potential of fixed displacement compressors, and accelerate the technical upgrading. Accelerate the research and
development of electric compressor product technology, master the key technologies of electric compressor,
realize the mainstream coverage of product series, and lead the product performance independently. Carry out
industrial research on the thermal management system of new energy vehicles, accelerate the breakthrough of
system matching and heat pump technology, and transform and upgrade to the thermal management system of
new energy vehicles. Strengthen the five major capacity building, including experimental design, experimental
detection, experimental analysis and basic ability improvement, and greatly enhance the comprehensive strength
of experimental trial production. By 2025, the investment in science and technology will be over 5%, and the
contribution rate of new products will be over 65%.
(3) Strive to comprehensively deepen reform and stimulate the vitality of business development.
Comprehensively implement the three-year reform of state-owned enterprises, and continuously promote the
deep integration and efficient linkage between company reform and development. Improve the market-oriented
management mechanism, promote the reform of the distribution system, carry out medium and long-term
incentives, and implement the tenure system and contractual management of managers. Strengthen slimming,
improve quality and efficiency, and complete the revitalization and utilization of idle assets and land resources.
Deepen the reform of mixed ownership, promote the optimization of the ownership structure of listed companies,
actively explore "B to A", and build a financing guarantee platform.
(4) Focus on promoting the construction of talent team and providing manpower support for development.
Implement resource allocation optimization project to improve organizational operation efficiency;
Implement incentive mechanism innovation project, build value-oriented distribution mechanism, optimize
performance tools and improve artificial output benefits; Implement the talent echelon optimization project, based
on strategic traction, and build the "2841" talent development system with industry competitiveness around
"excellent young talents, expert talents, middle-level talents and high-level talents"; Implement the training system
optimization project, establish a multi-channel and multi-means talent training platform, and broaden the talent
training channels.
(5) Strive to promote benchmarking and provide management support for development.
Strengthen the benchmarking management, implement the benchmarking world-class management
improvement action plan, and improve the scientific management level; Strengthen investment management, take
digitalization, informationization, automation and intelligence as the direction, and enhance the core
manufacturing capabilities of traditional industries; Strengthen lean management, implement lean management
"211" from the heart, and achieve A level of lean management in 2025; Strengthen quality management and
implement six major actions to improve quality. In 2025, the quality cost rate will reach below 1.2%; Strengthen
cost management and promote the whole value chain and life cycle management. In 2025, the cost and expense
ratio will decrease by more than 1.5% compared with 2020; Strengthen data management, build an information
29
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
system platform framework for intelligent manufacturing, and empower high-quality development with intelligent
manufacturing; Strengthen brand management and build the "Jianshe" brand into a leading brand in the domestic
automobile compressor industry; Strengthen safety and environmental protection management, basically improve
the big safety system, improve the level of intrinsic safety in an all-round way, and zero penalty and zero standard
for environmental pollution; Strengthen risk management, comprehensively improve the risk management and
control system based on problems and risks, and ensure that the overall risk of the company is controllable;
Strengthen the construction of the rule by law, improve the legal work system, and promote the culture of rule by
law.
(6) Focus on promoting party building and providing party building support for development
Strengthen political leadership, strengthen "four consciousnesses", strengthen "four self-confidences" and
achieve "two maintenance", and resolutely implement the important instructions of General Secretary Xi Jinping
and the decision-making arrangements of the CPC Central Committee. Strengthen ideological guidance,
thoroughly study Xi Jinping's socialism with Chinese characteristics in the new era, and firmly grasp the
leadership and discourse power of ideological work. Consolidate the organizational foundation, strengthen the
normalization and standardization of grassroots party building work, and promote the deep integration of party
building and production and operation. Strengthen the forging of work style, focus on rectifying formalism and
bureaucracy, persistently implement the spirit of the eight central regulations, and strictly prevent the "four styles"
from rebounding. Strengthen discipline guarantee, deepen the comprehensive and strict administration of the party,
give full play to the role of patrol and inspection, and earnestly strengthen the Party conduct and uphold integrity
and anti-corruption work.
(III) Company's production and operation arrangement in 2021
The company will closely follow the development direction of the auto parts industry, take the lead in
developing the auto air-conditioning compressor business, innovate and develop new energy business, develop
joint ventures with high efficiency, and strive to become an excellent domestic auto heat management system
supplier and march towards a world-class enterprise with international competitiveness. In 2021, efforts will be
made to achieve sales of 1.92 million units of automobile air-conditioning compressors, with a sales revenue of
RMB 730 million. In order to achieve the annual target, the following aspects need to be emphasized in 2021:
1. Focus on transformation and upgrading, and effectively improve development capabilities
Deepen the market potential of fixed displacement compressor. Well ensure market project development to
ensure the success rate of listing is 100%; Expand overseas markets and strive to obtain Peugeot CMP projects;
Focus on the new market expansion of commercial vehicles such as Great Wall and Geely, and expand the scale of
commercial vehicle market; Strengthen the offline market expansion and achieve more than 50% growth; Ensure
to achieve the annual sales target.
Promote the scale of electric compressor. Keep a close eye on the new energy passenger car and commercial
vehicle market segments, vigorously promote 18CC and 27CC products, fully launch 36CC and related products,
increase the sales scale of electric compressors, and strive to quickly form a stable customer structure; Promote
the engineering manufacturing capacity building of 36CC electric compressor assembly and dynamic and static
disk processing, and improve the manufacturing capacity and production efficiency.
Accelerate the development of variable displacement compressor. Intensify market development, promote
cost reduction and tap potential, improve operation quality and competitiveness, and strive to complete annual
sales of more than 600,000 units for Jianshe HANON.
Strengthen intensive management of spare parts. Pingshan Taikai further expanded the sales of carburetors,
vigorously explored the market of throttle body and EFI system, promoted the market expansion of brushless fuel
30
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
pump, and used the existing assets to carry out the production and sales of auto parts; Casting Machine Division
focused on internal market, realized full-load production, strengthened QCD management, optimized
manufacturing process and improved processing efficiency.
2. Focus on scientific and technological innovation and effectively enhance core competitiveness
Strengthen the construction of scientific and technological innovation system. Strengthen the cooperation
between production, education and research with scientific research institutions, strengthen the "zero
coordination", deepen the cooperation and development with the main engine factory, and quickly form the
system capability.
Build an electric compressor platform. Optimize the performance of 18CC and 27CC products to ensure
product stability; Complete the design and finalization of 36CC electric compressor to realize small batch supply;
Carry out research on heat pump electric compressor, and complete prototype development of air supply and
enthalpy increase electric compressor.
Promote the technical research of heat pump air conditioning system. Carry out system and single product
evaluation research and build test ability; Carry out research on test technology of heat pump air conditioning
system and establish test specifications; Carry out research on matching technology of heat pump air conditioning
system to form basic matching technical ability; Set up a basic heat pump air conditioning test system.
Promote the upgrading of traditional compressor technology. Actively respond to market and customer
changes, and create competitive products such as 09D and 11D in a targeted manner; Complete the application of
P5 technology closure and carry out the research of new generation P6 technology; Fully promote the
development and application of powder metallurgy technology and aluminum machine market.
3. Focus on improving quality and efficiency, and effectively improve the quality of operations
Strengthen comprehensive budget management, give full play to the leading role of budget, strengthen the
rigid constraints of "budget, implementation, assessment and accountability", scientifically allocate budget
resources, and improve resource utilization efficiency.
Strengthen risk and fund management, strengthen daily monitoring and urge rectification, strictly implement
various measures to prevent and resolve risks, and effectively resolve risks; Continuously optimize the financing
structure of the company to ensure the safety of the capital chain.
The above financial budget, business plan, and business goals do not represent the Company’s profit forecast
for the future years, and whether it can be achieved depends on various factors such as changes in market conditions
and the efforts of the business team. As there is great uncertainty, investors are advised to pay attention to it.
Ⅹ.Particulars about researches, visits and interviews received in this reporting period
1.Particulars about researches, visits and interviews received in this reporting period
√ Applicable □ Not applicable
Index of Basic
Types of Information on
Reception Place of Way of Visitors
visitors Main contents discussed and information provided the
time reception reception received
received Investigation
and Survey
31
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Q：Was the Company's performance in the first
quarter affected by the new coronavirus epidemic?A：
The new coronavirus epidemic has caused a decline
Register of visi
in domestic automobile production and sales. As a
March The Individu tors for investo
By phone Ms.Liu supporting company for auto parts, the new
20,2020 Company al rs of the compa
coronavirus epidemic has a certain impact on the
ny
Company's compressor production and sales in the
first quarter. For details, please refer to the Company's
disclosure of the first quarter report.
Q：What’s the progress of construction and
development of Jianshe Hanon?A: The Company has
completed the first phase of the production capacity
Register of visi
construction of 400,000 variable displacement
The Individu tors for investo
July 13,2020 By phone Mr. Chen compressors, and achieved mass production last year.
Company al rs of the compa
The Jianshe HANON has won the bids for 5 platform
ny
projects including Changan and Great Wall, and the
development of new markets is progressing in an
orderly manner.
Q：The Company established a land resource
revitalization project team. What work is this project
team mainly responsible for?A：In order to promote
the Company's sustainable development and realize
the effective use of land resources, the Company Register of visi
October The Individu established a land resource revitalization project tors for investo
By phone Mr.Xu
30,2020 Company al team, who’s responsible for the overall management rs of the compa
of the revitalization of land resources, such as the ny
formulation of land and related building operation
plans, the development of market sourcing and price
inquiry, and the approval and review of land disposal
procedures.
Q：Dongbei B has successfully transferred to the A
board, will the Company implement the B-share
Register of visi
reform?A：The Company has been paying close
November The Individu tors for investo
By phone Mr. Yang attention to the reform trends and implementation
19,2020 Company al rs of the compa
cases of B-shares in the securities market, and hopes
ny
to promptly promote B-share reforms under the
guidance of relevant policies in the future.
Reception times 33
Reception agency amount 2
Reception personal number 31
Others 0
Whether to disclose, reveal or disclose non-public material Undisclosed and unacknowledged significant information.
32
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
information
33
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
V. Important Events
ⅠSpecification of profit distribution of common shares and capitalizing of common reserves
Formulation, implementation and adjustment of profit distribution policy of common shares especially cash
dividend policy during the reporting period
√ Applicable □ Not applicable
According to " notice of related matters about further implementation of the listed company's cash dividend
( [2012] No. 37)"issued by China Securities Regulatory Commission. On July 26th, 2012,the company’s the sixth
board of directors made some supplements and revisions about profit distribution policy stipulated in articles of
association its seventh meeting, which confirms the specific policies in terms of profit allocation forms, specific
conditions and proportion of dividend distributions and using principles of undistributed profits,and commits
deliberation and permission of first extraordinary general meeting in 2012,convened on August 30, 2012. Board of
directors maps out the annual per-arranged planning about distribution of profits, which conforms to the
regulations of articles of association under the consent issued by independent director. Per-arranged planning
about distribution of profits that has been examined and approved by the company’s general meeting of
shareholders has been already completed by board of directors.
Special cash dividend policy description
Whether meets the requirements of the provisions of the articles of
Yes
association or shareholders' meeting resolutions:
Whether dividends standard and proportion are clear Yes
Whether decision making and supervision mechanism for profit distribution
Yes
are completed
Whether independent directors perform their duties responsibly and play its
Yes
due role:
Whether the Minority shareholders have adequate opportunity to express
their views and aspirations and Their legitimate rights and interests have Yes
been fully protected
Whether the Cash dividend policy to adjust or change the conditions and
Yes
procedures are compliant and transparent
The profit distribution preplan or proposal and the preplan or proposal of conversion of the capital reserve into
share capital in the past three years(with the reporting period inclusive):
The Company's net profit in 2019 was negative, while the Company achieved profit in 2018 and 2020,According
to the Articles of Association, the after-tax profit of the Company shall give priority to make up for losses of
previous years, The company's net profit is negative. so the Company has not implemented profit distribution and
capitalization of capital reserve funds in the past three years.
Dividend distribution of the latest three years
34
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
In RMB
Ratio of the
total cash
bonus (other
ways
Net profit Ratio in net included) in
attributable to profit Amount of Proportion of net profit
Amount for the over of the attributable to cash dividends cash dividends Amount for
attributable
cash bonus parent the parent from cash offer from cash offer cash bonus
Year to common
(tax company in the company in the to repurchase to repurchase (tax
stock
included) consolidated consolidated shares of the shares of the
included)
shareholders
financial financial funds funds
statements statements of listed
company
contained in
consolidation
statement
2020 0.00 1,415,942.45 0.00% 0.00 0.00% 0.00 0.00%
-121,128,719.9
2019 0.00 0.00% 0.00 0.00% 0.00 0.00%
3
2018 0.00 10,543,247.05 0.00% 0.00 0.00% 0.00 0.00%
In the reporting period, both the Company’s profit and the parent company’s retained earnings were positive
however not cash dividend distribution proposal has been put forward.
□ Applicable √Not applicable
II.Profit distribution plan and capitalizing of common reserves plan for the Period
□ Applicable √ Not applicable
The Company has no plan of cash dividends carried out, bonus issued and capitalizing of common reserves either.
III.Commitments to fulfill the situation
1.The fulfilled commitments in the reporting period and under-fulfillment commitments by the end of the
reporting period made by the company, shareholder, actual controller, acquirer, director, supervisor, senior
management personnel and other related parities.
□ Applicable √ Not applicable
Non-existent
35
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
2.The existence of the company's assets or projects earnings forecasts and earnings reporting period is still in the
forecast period, the company has assets or projects meet the original profit forecast made and the reasons
explained
□Applicable √ Not applicable
IV. Particulars about the non-operating occupation of funds by the controlling shareholder
□Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
V. Explanation of the Supervisory Committee and Independent Directors (If applicable)on the Qualified
Auditor’s Report Issued by the CPAs.
□ Applicable √ Not applicable
VI.Explain change of the accounting policy, accounting estimate and measurement methods as compared
with the financial reporting of last year.
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VII. Explain retrospective restatement due to correction of significant accounting errors in the reporting
period
□Applicable √ Not applicable
No such cases in the Reporting Period.
VIII.Explain change of the consolidation scope as compared with the financial reporting of last year.
√ Applicable □ Not applicable
In the year, after the Company acquired 50% equity of the Pingshan Taikai, the Company holds 100% of Pingshan
Taikai equity, and Pingshan Taikai is included into the consolidated statement.
IX. Engagement/Disengagement of CPAs
CPAs currently engaged
Domestic CPA Zhongxingcai Guanghua Certified public Accountants LLP.
Reward for domestic CPA (RMB 10,000) 45
Successive years the domestic CPA has been providing service to
4 years
the Company
Name of CPAs from the domestic CPA firm Fan Rui, Zhang Weidong
Continuous life of auditing service for domestic accounting firm 4 years,1 year
36
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Has the CPAs been changed in the current period
□ Yes √ No
Description of the CPAs, financial adviser or sponsor engaged for internal control auditing
√Applicable □Not applicable
1.The Company paid RMB 150,000 to Zhongxingcai Guanghua Certified public Accountants LLP for its internal auditing
service of one year.’
X. Situation of Facing Listing Suspension and Listing Termination after the Disclosure of the Yearly
Report
□Applicable √ Not applicable
XI. Bankruptcy reorganization
□Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period.
XII. Significant lawsuits and arbitrations of the Company
√ Applicable □Not applicable
Involved
Index to
amount Decisions and Execution of Disclosure
General information Provision Progress disclosed
（RMB effects decisions date
information
10,000)
Chongqing HYOSOW have failed
to pay Vehicle Air Conditioning
See details in
Company, a full-owned subsidiary
the
of the Company for the air
company’s
conditioner compressors. The
announcemen
Vehicle Air Conditioning
t published
Company filed a lawsuit with
Return of on securities
Chongqing Yubei District People's
The Company 947 sets of times,
Court in November 2018, who
The trial has fully automobile air August Hongkong
held a hearing on July 11, 2019. 1,232.5 No
ends accrued bad condition 16,2019 Commercial
The Company received the "Civil
debts in 2018. compressors. daily and
Judgment of Chongqing Yubei
http//www.cn
District People's Court" on August
info.com.cn
6, 2019 ((2018) Y0112 MC, No.
(Announcem
24010), where the "General Rules
ent
for Purchase of Parts and
No.:2019-070
Materials" signed by the
)
Company and Chongqing
HYOSOW was cancelled.
37
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Chongqing HYOSOW returned
4,017 sets of goods to the Vehicle
Air Conditioning Company, and
paid 12,325,044.85 yuan and loss
of capital occupation.
Chongqing Kaite Engine
Technology Co., Ltd. (hereinafter
referred to as "Chongqing Kaite")
have failed to pay Vehicle Air
Conditioning Company, a In March
See details in
full-owned subsidiary of the 2021, the
the
Company for the air conditioner bankruptcy
company’s
compressors. The Vehicle Air acceptance
announcemen
Conditioning Company filed a ruling (No.
t published
lawsuit with Chongqing Yubei 652-(2020) Yu
on securities
District People's Court in 05 Poshen)
The Company times,
November 2018, who held a was received,
The trial has fully September Hongkong
hearing on July 11, 2019 and 6.01 No and the
ends accrued bad 12,2019 Commercial
issued "Civil Judgment of execution was
debts in 2018. daily and
Chongqing Yubei District People's terminated (no
http//www.cn
Court" on August 13, 2019 property
info.com.cn
((2018) Y0112 MC, No. 24011), execution,
(Announcem
where the "General Rules for bankruptcy
ent
Purchase of Parts and Materials" has been
No.:2019-071
signed by the Company and filed).
)
Chongqing Kaite was cancelled.
Chongqing Kaite paid 60,126.75
yuan and loss of capital
occupation to the Vehicle Air
Conditioning Company.
Chongqing Bisu Yumbo Power In September See details in
Technology Co., Ltd. (hereinafter 2020, the the
referred to as "Chongqing Bisu") BAIC company’s
have failed to pay Vehicle Air Yinxiang announcemen
Conditioning Company, a Bankruptcy t published
full-owned subsidiary of the The Company Acceptance on securities
Company for the air conditioner The trial has fully Application September times,
539.68 No
compressors. The Vehicle Air ends accrued bad Ruling 25,2019 Hongkong
Conditioning Company filed a debts in 2018. (No.449-(2020 Commercial
lawsuit with Chongqing Yubei ) Yu 05 daily and
District People's Court in Poshen) was http//www.cn
November 2018, who held a received, and info.com.cn
hearing on July 11, 2019 and the execution (Announcem
issued the "Civil Judgment of was ent
38
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Chongqing Yubei District People's terminated (no No.:2019-072
Court" on September 18, 2019 property )
((2018) Y0112 MC, No. 23992), execution, the
where the "General Rules for bankruptcy
Purchase of Parts and Materials" reorganization
signed by the Company and has been
Chongqing Bisu was cancelled. applied for).
Chongqing Bisu paid
5,396,775.35 yuan and loss of
capital occupation to the Vehicle
Air Conditioning Company. Baic
Yinxiang Automobile Co., Ltd. is
jointly and severally liable for the
above debts of the Defendant
Chongqing Bisu.
Hafei Automobile Co., Ltd.
(hereinafter referred to as: Hafei
Hafei
Automobile) have failed to pay
Automobil
3,999,944.43 yuan for air
e Co., Ltd.
conditioning compressors of
failed to
Vehicle Air Conditioning
make the
Company, a full-owned subsidiary
payment See details in
of the Company. The Vehicle Air
on the
Conditioning Company filed a
schedule. company’s
lawsuit with Harbin Pingfang In May 2020,
In announcemen
District People's Court in August it received the
December t published
2018. On October 24, 2018, the judgment of
2018, the on securities
Harbin Pingfang District People's termination of
Vehicle The Company times,
Court mediated and issued a execution
Air has fully November Hongkong
“Civil Mediation Document” 400 No (Black
Condition accrued bad 16,2018 Commercial
[(2018) H0108MC, No. 1416], No.0108247
er applied debts in 2018. daily and
agreeing to pay the arrears of (2019)), and
to the http//www.cn
3,999,944.43 yuan in installments no property
court for info.com.cn
from October 2018 to February was executed.
compulsor (Announcem
2019. However, Hafei Automobile
y ent
Co., Ltd. did not pay on schedule.
enforceme No.:2019-070
In December 2018, the
nt. The )
Air-conditioning Company
case is
applied to the Harbin Pingfang
currently
District People's Court,
under
Heilongjiang Province for
implement
compulsory enforcement. The
ation.
case is currently under
implementation.
39
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
The Company’s wholly-owned
subsidiary Automotive Air
Conditioning Company sued Ran
Ping, Luo Fangqing, Zhang Ye,
Changzhou Kang Purui
Suzhou
Automotive Air Conditioning Co.,
Intermedia
Ltd, Chongqing Yuxian Sanji
te People's Will open www.cninfo.
Auto Parts Co., Ltd, and
Court Not yet open a court session April com.cn.Anno
Chongqing Dongdian 100 No
Minchu court session on April 8, 28,2020 uncement
Refrigeration Equipment in the
No.305 2021 No.:2020-024
Fifth Intermediate People’s Court
(2021) Su
of Chongqing Municipality over
05
the case of infringement of
technical secrets, which had been
transferred to the jurisdiction of
the Suzhou Intermediate People's
Court.
In July 2020,
it received
The Company’s wholly-owned 76,000 yuan
subsidiary-Automotive Air of the
Conditioning Company filed a implementatio
lawsuit in the Wendeng District n of the
People’s Court of Weihai City due reconciled sett
to the dispute over the sale and Min Chu lement, and
purchase contract, demanding No.6002-( the court
12.84 No The trial ends
Beiqi Heibao (Weihai) 2019) Lu issued a ruling
Automobile Co., Ltd pay 128,400 1003 to terminate
yuan in arrears. According to the the execution
court mediation document Min in July 2020
Chu No.6002-(2019) Lu 1003 (Zhi No.
dated November 20, 2019, the 973-(2020) Lu
defendant shall pay 127,600 yuan. 1003), and the
case was
concluded
The Company’s wholly-owned
subsidiary- Automotive Air It had been
Conditioning Company-sued in Chuan(20 fulfilled in
the Chengdu Longquanyi District 20) May 2020.
3.01 No The trial ends
People’s Court for a dispute over Minchu The case had
the sale and purchase contract, No.2994 been
demanding Sichuan Yema concluded.
Automobile Co., Ltd pay 30,100
40
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
yuan in arrears. According to the
court mediation document Min
Chu 2994-(2020) Chuan 0112
dated April 29, 2020, the
defendant shall pay 18,000 yuan.
The Company’s wholly-owned
subsidiary- Automotive Air
Conditioning Company-sued in
the People’s Court of Xiangyang
High-tech Zone for a dispute over
the sale and purchase contract,
demanding that Hubei Meiyang The Company
Automobile Industry Co., Ltd pay Min Chu has fully
Apply for
1,408,800 yuan in arrears and No. accrued bad
154.32 No enforcement
return 260 compressors. 3234-(201 debts of 1.4088
in March 2021
According to the civil judgment of 9) E 0691 million in 2020.
the Min Chu No. 3234-(2019) E
0691 on November 19, 2020, the
defendant shall pay the
air-conditioning company
1,408,800 yuan for goods and
interest losses, and return 260
compressors.
Min Chu
No. 4664
-(2020) Yu
0113
Judgment,
The Company sued in the Ba’nan
Min Chu
District People’s Court of The
No. 4665-
Chongqing City for a dispute over application for
(2020) Yu
a lease contract and required the The Company enforcement
0113
lessee Chongqing Construction has fully was applied in
Judgment,
Lijue Industrial Co., Ltd to pay a 139.87 No accrued bad September
Min Chu
lease fee with 5 cases totaling debts of 1.4789 2020, and no
No. 4684
1,398,700 yuan. According to the million in 2020. property has
-(2020) Yu
court’s judgment (mediation) in been executed
0113
June 2020, the defendant shall pay yet.
Judgment,
981,800 yuan.
Min Chu
No. 4685
-(2020) Yu
0113
Judgment,
41
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Min Chu
No. 4686
-(2020) Yu
0113
Judgment
XIII. Situation of Punishment and Rectification
□Applicable √ Not applicable
No such cases in the Reporting Period.
XIV. Credit Condition of the Company and its Controlling Shareholders and Actual Controllers
□Applicable √ Not applicable
XV. Implementation Situation of Stock Incentive Plan of the Company, Employee Stock Ownership Plan or
Other Employee Incentive Measures
□Applicable √ Not applicable
During the reporting period, the company has no stock incentive plan, employee stock ownership plan or other
employee incentives that have not been implemented.
XVI.Material related transactions
1. Related transactions in connection with daily operation
√Applicable □ Not applicable
Whethe
Trading r over
Principl
limit the Market Index
Subjects e of
Amount price of of
of the pricing Ratio in approve approve Way of Date of
Related Relation Type of Price of of trade similar informa
related the similar paymen disclosu
parties ship trade trade RMB10 trade tion
transacti related trades d d t re
,000) availabl disclos
ons transacti
e ure
ons （RMB limited
10,000) or not
(Y/N)
http//w
ww.cni
Jianshe
Under Purchas Lease Fair nfo.co
Mechanic 100.00 April
same e of producti Market 313 313 350 No Cash 313 m.cn.
al and % 28,2020
control goods on site Price Announ
Electric
cement
No.:202
42
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
0-027
China
Changan
Sale of
Automobi
finished The
le Group Under Fair
Sales of parts Note+C April same as
Co., Ltd. same Market 14609 14,609 20.30% 18,000 否 14609
goods and ash 28,2020 above
And its control Price
compon
affiliated
ents
Enterprise
s
Jianshe The
Under Rental Fair
Mechanic Sales of April same as
same warehou Market 318 318 63.00% 350 No Cash 318
al and goods 28,2020 above
control se Price
Electric
Joint
venture
The
of Spare Fair
Chongqin Sales of April same as
controlli parts Market 584 584 0.80% 200 Yes Cash 584
g Jianya goods 28,2020 above
ng sales Price
sharehol
der
Joint
venture
South Air The
of Spare Fair
Internatio Sales of April same as
controlli parts Market 14 14 0.12% 50 No Cash 14
nal goods 28,2020 above
ng sales Price
sharehol
der
Spare Fair
Jianshe Joint Sales of
part market 80 80 0.11% 0 Yes Cash 80
HANON venture goods
sales price
Under Fair
Jianshe Sales of
same Energy Market 31 31 45.00% 0 Yes Cash 31
Industry goods
control Price
The
Under Fair
Jianshe April same as
same Services Test market 100 100 59.00% 100 No Cash 100
Industry 28,2020 above
control price
Joint
Fair The
Chongqin venture April
Services Test Market 0.2 0.2 0.13% 10 No Cash 0.2 same as
g Jianya of 28,2020
Price above
controlli
43
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
ng
sharehol
der
Joint
Minsheng
venture
Logistrics
of Fair
And its
controlli Services Services market 58 58 40.00% 0 Yes Cash 58
affiliated
ng price
Enterprise
sharehol
s
der
Southwes
t
Ordnance
Chongqin
Under Fair
g Institute
same Services Services Market 104 104 54.00% 0 Yes Cash 104
of
control Price
Environm
ental
Protection
Co., Ltd.
Changan
The
Auto And Under Accept Fair
Note+C April same as
its same Services mainten market 112 112 40.00% 250 No 112
ash 28,2020 above
affiliated control ance price
Enterprise
16,323.
Total -- -- -- 19,310 -- -- -- -- --
2
Details of any sales return of a large
None
amount
The estimated total amount of "purchasing raw materials from related parties" is RMB 3.5
million, and the actual amount incurred is RMB 3.13 million. The estimated total amount of
Give the actual situation in the report
"selling products and commodities to related parties" is RMB 186 million, and the actual
period where a forecast had been
amount incurred is RMB 156.36 million.
made for the total amounts of routine
The estimated total amount of "accepting labor services provided by related parties" is
related-party transactions by type to
RMB 3.6 million, and the actual amount incurred is RMB 3.742 million. The actual
occur in the current period(if any)
occurrence exceeded the budget by RMB 142,000, accounting for 0.08% of the company's
latest audited net assets
Reason for any significant difference
between the transaction price and the Not applicable
market reference price (if applicable)
44
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
2. Related-party transactions arising from asset acquisition or sold
□Applicable √ Not applicable
No related transactions by assets acquisition and sold for the Company in reporting period.
3. Related-party transitions with joint investments
□Applicable √ Not applicable
No main related transactions of joint investment outside for the Company in reporting period.
4.Contact of related credit and debt
√ Applicable □Not applicable
Whether there is non operating related debt and debt
□Yes√ No
Not-existent
5. Other significant related-party transactions
√ Applicable □ Not applicable
According to the "Financial Service Agreement" signed by the company and the Military Equipment Group Finan
ce Company, as of December 31, 2020, the company and its subsidiaries had a deposit balance of RMB75.2999 m
illion and a short-term loan balance of RMB170.41 million. Accumulated interest paid was 3.276 million
yuan . The above deposits, borrowings and interest arising from credit business such as comprehensive credit gra
nting and bill discounting have not exceeded the scope approved by the general meeting of shareholders.
Website for temporary disclosure of the connected transaction
Announcement Date of disclosure Website for disclosure
Announcement on Acceptance of Financia
April 25, 2019 http//www.cninfo.com.cn. Announcement No.:2019-041
l Services and Related Transactions
See details in the company’s announcement published on
Announcement of Resolutions of the
May 18, 2019 securities times, Hongkong Commercial daily and
shareholders' general meeting of 2018
http//www.cninfo.com.cn (Announcement No.:2019-059)
XVII.Particulars about significant contracts and their fulfillment
1. Particulars about trusteeship, contract and lease
(1) Trusteeship
□Applicable √ Not applicable
No trusteeship, contract or leasing for the Company in reporting period.
45
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
(2) Contract
□ Applicable √ Not applicable
No any contract for the Company in the reporting period.
(3) Lease
√ Applicable □ Not applicable
Lease description
(1)The Company is the Lessor:
Name of Lessee Type of leased asset Lease income recognized in lease fee confirmed last
the current year year
Jianshe Mechanical and Electric Factory 3,187,684.37 5,670,620.70
Jianshe Mechanical and Electric Machinery equipment 1,262,889.91
②The Company is the Lessee:
Name of Lessor Type of leased asset Rental recognized in the lease fee confirmed last yea
current year
Jianshe Mechanical and Electric Factory 3,131,505.24 3,060,055.14
Items which resulted in profit or loss achieving over 10% of the total profit for the Company
□ Applicable √ Not applicable
Not-existent
2.Guarantees
√ Applicable □Not applicable
（1）Guarantees
In RMB 10,000
Guarantee of the Company for the controlling subsidiaries (Exclude controlled subsidiaries)
Amount of Actual date of
Amount of Actual
guarantee occurring Type of Complete Related
Guarantee provided to the amount of Term
and date of (signing date of guarantee d or not guarantee
guarantee guarantee
disclosure agreements
Total of external guarantee approved in the Total of external guarantee actually
0 0
report term (A1) occurred in the report term (A2)
Total of external guarantee approved as of end Total of external guarantee actually
0 0
of report term (A3) occurred as of end of report term (A4)
Guarantee of the company for its subsidiaries
Guarantee Amount of Amount of Actual date of Actual Type of Complete Related
Term
provided to guarantee and date the occurring (signing amount of guarantee d or not guarantee
46
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
of disclosure guarantee date of agreements guarantee
Vehicle air
April 25,2019 1,750 July 5,2019 1,750 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 1,771 July 11,2019 1,771 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 5,000 August 16,2019 5,000 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 2,000 September 20,2019 2,000 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 2,500 October 10,2019 2,500 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 1,000 October 16,2019 1,000 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 2,500 October 23,2019 2,500 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 3,248 December 26,2019 3,248 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 25,2019 3,000 September 10,2019 3,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 3,000 September 17,2019 3,000 Joint liabilities 24 months Yes No
conditioner
Vehicle air
April 25,2019 3,000 October 8,2019 3,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 1,200 October 8,2019 1,200 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 2,450 October 28,2019 2,450 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 5,000 November 20,2019 5,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 3,450 November 28,2019 3,450 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 5,579 December 9,2019 5,579 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 2,000 December 12,2019 2,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 2,549 December 17,2019 2,549 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 25,2019 2,000 December 18,2019 2,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
April 28,2020 1,751 January 8,2020 1,751 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 28,2020 1,771 January 17,2020 1,771 Joint liabilities 12 months No No
conditioner
Vehicle air
April 28,2020 5,000 February 28,2020 5,000 Joint liabilities 12 months No No
conditioner
Vehicle air
April 28,2020 2,000 March 17,2020 2,000 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 28,2020 2,500 April 13,2020 2,500 Joint liabilities 12Months No No
conditioner
Vehicle air
April 28,2020 1,000 April 20,2020 1,000 Joint liabilities 12months No No
conditioner
Vehicle air
April 28,2020 2,501 April 28,2020 2,501 Joint liabilities 12months No No
conditioner
Vehicle air
April 28,2020 2,800 June 16,2020 2,800 Joint liabilities 6 months Yes No
conditioner
Vehicle air
April 28,2020 3,000 June 19,2020 3,000 Joint liabilities 12months No No
conditioner
Vehicle air
April 28,2020 3,000 July 29,2020 3,000 Joint liabilities 12 months No No
conditioner
Vehicle air
April 28,2020 1,751 July 31,2020 1,751 Joint liabilities 6 months No No
conditioner
Vehicle air
April 28,2020 3,000 August 11,2020 3,000 Joint liabilities 12 months No No
conditioner
Vehicle air
April 28,2020 1,000 August 27,2020 1,000 Joint liabilities 12 months No No
conditioner
47
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Vehicle air
April 28,2020 3,248 September 23,2020 3,248 Joint liabilities 6 months No No
conditioner
Vehicle air
April 28,2020 3,450 October 12,2020 3,450 Joint liabilities 7 months No No
conditioner
Vehicle air
April 28,2020 2,000 October 15,2020 2,000 Joint liabilities 7 months No No
conditioner
Vehicle air
April 28,2020 2,000 October 16,2020 2,000 Joint liabilities 6 months No No
conditioner
Vehicle air
April 28,2020 2,549 October 19,2020 2,549 Joint liabilities 7 months No No
conditioner
Vehicle air
April 28,2020 2,000 November 3,2020 2,000 Joint liabilities 6 months No No
conditioner
Vehicle air
April 28,2020 5,579 December 4,2020 5,579 Joint liabilities 12 months No No
conditioner
Total of guarantee to subsidiaries approved in Total of guarantee to subsidiaries actually
61,000 51,900
the report term (B1) occurred in the report term (B2)
Total of guarantee to subsidiaries approved as Total of balance of guarantee actually provided
61,000 45,349
of the report term (B3) to the subsidiaries as of end of report term (B4)
Guarantee of the subsidiaries for its subsidiaries
Guarante
Related Date of Complete
Actually e for
Name of the company announcem Amount of happening(date Guarantee Guarantee implemen
guarantee related
guaranteed ent date guarantee of signing type term tation or
amount party(yes
and no. agreement) not
or no)
Total guarantee quota to the subsidiaries Total amount of guarantee to the subsidiaries actually
0 0
approved in the reporting period (C1) incurred in the reporting period (C2)
Total guarantee quota to the subsidiaries Total balance of actual guarantee to the subsidiaries
0 0
approved at the end of the reporting period (C3) at the end of the reporting period (C4)
Total of Company’s guarantee（namely total of the large three aforementioned）
Total of guarantee in the Period Total of actual guarantee in
61,000 51,900
（A1+B1+C1） the Period（A2+B2+C2）
Total of actual guarantee at
Total of guarantee at Period-end（A3+B3+C3） 61,000 Period-end 45,349
（A4+B4+C4）
The Company’s total guarantee(i.e.total of the first three main
261.24%
items)（A4+B4+C4）
Including：
Amount of guarantee for shareholders, actual controller and its associated parties（D） 0
The debts guarantee amount provided for the
Guaranteed parties whose assets-liability ratio exceed 45,349
70% directly or indirectly（E）
Proportion of total amount of guarantee in net assets of the company exceed 50%（F） 43,198.87
Total guarantee Amount of the abovementioned guarantees（D+E+F） 51,900
Explanations about joint and several liability for repayment in respect of undue
None
guarantee(if any)
48
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Explanation about external guarantee violating established procedure if any） None
Description of the guarantee with complex method
(2) Illegal providing of external guarantees
□ Applicable √ Not applicable
No illegal providing of external guarantees in the report period.
3.Situation of Entrusting Others for Managing Spot Asset
(1)Situation of Entrusted Finance
□ Applicable √ Not applicable
Not-existent
(2)Situation of Entrusted Loans
□ Applicable √ Not applicable
Not-existent
4.Major contracts for daily operations
□ Applicable √ Not applicable
5. Other significant contract
□ Applicable √ Not applicable
Not-existent
XVIII. Social responsibility
1. Execution of social responsibility of targeted poverty alleviation
(i) Protection of shareholders’ equity
The company always insists on fair treatment to all investors, protects the legitimate rights and interests of
shareholders, especially small and medium shareholders, and actively creates conditions to attract small and
medium shareholders to participate in major decisions of the company. During the reporting period, the Board of
Directors convened 3 general meetings of shareholders by providing on-site voting and online voting, and the
shares held by shareholders participating in voting accounted for more than 74.45% of the total shares of the
company.
The Company strictly follows the principles of information disclosure and publishes regular reports and
temporary announcements in a true, accurate, complete and timely manner. There is no selective information
disclosure and private disclosure or disclosure of undisclosed material information. Also, the Company seriously
replies or receives investors’ calls and visits and maintains good management of investor relations.
(II) Protection of employee rights and interests
49
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
The company strictly abode by the relevant provisions of the Labor Law and the Labor Contract Law, and
has established a sound human resources, occupational health and safety management system. First, adhere to the
democratic management system, set up employee directors and employee supervisors to participate in the
company's decision-making and supervision, hold employee representative symposiums twice, and listen to
employees' opinions and suggestions on the company's development. Second, sign collective contracts, special
collective contracts on wages, and special collective contracts on protection the special rights and interests of
female employees on schedule. Third, continue to make factory affairs public, and disclose matters that employees
should know in a timely manner by the "Construction Shares" newspaper and OA collaborative office platform,
and disclose 146 major matters concerning the vital interests of employees throughout the year. Fourth, pay
attention to staff growth and personnel training, and organize 147 training sessions throughout the year, with a
total of 4,960 person-times and a total of 28,738 hours. Fifth, care for the health of employees. During the
epidemic period, provide employees with masks and other protective products regularly to protect their health;
Intensify occupational health publicity and education, and regularly carry out occupational hazard detection and
occupational health examination in workplaces to ensure that no occupational diseases occur. Sixth, strengthen
staff safety management. Vigorously carry out three-year special rectification actions for work safety and major
rectification of safety and security work to improve the company's work safety level; Strengthen daily safety
inspection and construction safety technology management of relevant parties, and strengthen safety process
control. There are no deaths, serious injuries, minor injuries and public security incidents throughout the year.
(III) Protecting the rights and interests of suppliers, customers and consumers
Protection of suppliers' rights and interests: the company adheres to the principle of”fair, just and open”
tendering and procurement, implements the supervision throughout the whole process of project establishment,
bidding release, bid opening evaluation and contract signing, signs the integrity agreement with supplier, and
implements it into the basic procurement contract to achieve self discipline and mutual supervision between the
enterprise itself and its upstream and downstream customers.
In terms of customer and consumer rights protection: First, comprehensively improve the quality of products
and services, vigorously promote the construction of "1+N" quality system, and pass the IATF16949 system audit
and Chang'an QCA2.0 and Geely "3A" supplier system certification; Strengthen quality cost control, win the title
of China Chang'an Red List Enterprise for 12 consecutive quarters and the Quality Contribution Award issued by
Chongqing Chang'an for two consecutive years. Second, further promote lean production, strengthen the use of
advanced lean management tools, and improve lean production capacity. Steadily promote the transformation of
digital factory, and complete the construction of data collection, analysis and total quality management system of
5# assembly line; The company's "Intelligent Factory of Rotary Vane Air Conditioning Compressor for Vehicles",
auto frame welding automation and auto die casting machine production line construction "were selected into
Chongqing Intelligent Manufacturing and Industrial Internet Innovation Demonstration Support Project, and
Jianse HANON was awarded the title of" Intelligent Factory of Variable Displacement Air Conditioning
Compressor for Vehicles "in Chongqing.
(IV) Environmental protection and sustainable development
The company strictly abode by national laws and regulations on environmental protection, established
environmental protection management institutions, established an ecological environment risk prevention and
control system, and continuously strengthened the capacity building of emergency monitoring, emergency
response and risk prevention and control. Strictly implement the operation control of waste water and waste gas
treatment facilities, fine management of hazardous waste, and comprehensive achievement in discharge of waste
water, organized discharge of waste gas and unorganized discharge of waste gas. Continuously optimize the
50
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
process, replace nickel-containing phosphating solution with nickel-free phosphating solution, and realize zero
emission of Class I pollutants. The company and air conditioning company were awarded the titles of "Chongqing
Environmental Protection Honest Enterprise" and "Chongqing Environmental Protection Good Enterprise"
respectively.
(V) Public relations and public welfare undertakings
In 2020, the company actively participated in poverty alleviation activities of unsalable agricultural and
sideline products consumption in Yanshan County, Yunnan Province and Qianjiang City, Hubei Province, and
purchased unsalable agricultural and sideline products of RMB 32,000. It actively promoted employment to help
the poor, according to the special action arrangement of "resisting epidemic, stabilizing posts and expanding
employment" of Bingzhuang Group, and participated in more than 20 online double-election meetings combined
with the recruitment plan of the company, with more than 2,600 resumes received, more than 50 people
interviewed by means of WeChat video, and 6 people recruited. It actively responded to the national initiative and
organized party members and employees to donate RMB 116,757 to Wuhan Covid-19 epidemic prevention and
control.
2.Overview of the targeted poverty alleviation
The company has no precise social responsibility for poverty alleviation in the period and bas no follow-up plan
either.
3.Major environmental protection
The Listed Company and its subsidiary whether belongs to the key sewage units released from environmental
protection department
□ Yes √ No
Environmental protection information is disclosed on the website of the company
(http://www.jianshe.com.cn), including environmental protection information such as the names of all pollutants,
emission methods, number and distribution of discharge outlets, emission concentration and pollutant emission
standards for total volume, construction and operation of pollution prevention facilities, environmental impact
assessment of construction projects and other environmental protection administrative licenses, emergency plans
for sudden environmental incidents, and environmental self-monitoring plans. Meanwhile, you can also check the
company's sewage permit, the registration receipt of fixed pollution sources of Chongqing Jianshe Vehicle System
Co., Ltd. (registration number: 915000007474824231001X), and the national sewage permit of Chongqing
Jianshe Automobile Air Conditioner Co., Ltd. (certificate number: 9150000075925214XL001R).
XIX. Explanation on other significant events
□ Applicable √Not applicable
Not-existent
XX. Significant event of subsidiary of the Company
□ Applicable √Not applicable
51
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
VI. Change of share capital and shareholding of Principal Shareholders
Ⅰ.Changes in share capital
1. Changes in share capital
In Shares
Before the change Increase/decrease（+，-） After the Change
Amount Proportion Capitalizatio
Share Bonus n of Subtot Proport
Other Quantity
allotment shares common al ion
reserve fund
I. Unlisted shares 89,375,000 74.87% 0 0 0 0 0 89,375,000 74.87%
1. Founder's stock 89,375,000 74.87% 0 0 0 0 0 89,375,000 74.87%
Including: State-owned shares 84,906,250 71.13% 0 0 0 0 0 84,906,250 71.13%
Shares held by domestic legal
1,750,000 1.46% 0 0 0 0 0 1,750,000 1.46%
persons
Share held by foreign
0 0.00% 0 0 0 0 0 0 0.00%
investors
Other 2,718,750 2.28% 0 0 0 0 0 2,718,750 2.28%
2. Raising legal person shares 0 0.00% 0 0 0 0 0 0 0.00%
3. Internal staff shares 0 0.00% 0 0 0 0 0 0 0.00%
4. Preferred stock or other 0 0.00% 0 0 0 0 0 0 0.00%
II Listed shares 30,000,000 25.13% 0 0 0 0 0 30,000,000 25.13%
1. Common shares in RMB 0 0.00% 0 0 0 0 0 0 0.00%
2. Foreign shares in domestic
30,000,000 25.13% 0 0 0 0 0 30,000,000 25.13%
market
3. Foreign shares in overseas
0 0.00% 0 0 0 0 0 0 0.00%
market
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
100.00
III. Total of capital shares 119,375,000 100.00% 0 0 0 0 0 119,375,000
%
Reasons for share changed
□Applicable √Not applicable
Approval of Change of Shares
□Applicable √Not applicable
Ownership transfer of share changes
□Applicable √Not applicable
52
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Progress on any share repurchase:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to
common shareholders of Company in latest year and period
□Applicable √Not applicable
Other information necessary to disclose for the company or need to disclosed under requirement from security
regulators
□Applicable √Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to
common shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose for the company or need to disclosed under requirement from security
regulators
□ Applicable √Not applicable
II.Self-defined Chapter
When the company was founded in 1995, North China Industrial Shenzhen Co., Ltd., one of the founders,
held 17,875,000 shares of the company, accounting for 3.74% of the company's total share capital. According to
the Civil Order of the Shenzhen Intermediate People’s Court of Guangdong Province- [2006] Shenzhong Famin
Two Bankruptcy Zi No. 21-4) on March 6th, 2007, it’s ruled that the proprietary rights of the 3.74% stake
(17,875,000 legal person shares) of the company held by North China Industrial Shenzhen Co., Ltd. belongs to the
buyers Gu Zuocheng, Yangpu Xinyufeng Investment Co., Ltd. and Feng Yonghui. Thereinto, Gu Zuocheng held
8,875,000 shares; Yangpu Xinyufeng Investment Co., Ltd. held 7,000,000 shares; Feng Yonghui held 20,000
million shares.
On September 12, 2013, the company implemented a 4:1 share-shrunk. After the share-shrunk, Gu
Zuocheng held 2,218,750 shares; Hengsheng Sun Group Co., Ltd. held 1,750,000 shares; Feng Yonghui held
500,000 shares.
Therefore, in the above “Changes in Shares” table, the number of shares that’s filled in the “others” for the sponsors’
shares is the total shares held by the natural persons Gu Zuocheng and Feng Yonghui, namely: 2,718,750 shares.
3. Change of shares with limited sales condition
□Applicable √Not applicable
Ⅱ.Issuing and listing
1.Explanation of the Situation of the Security Issue(No Preferred Shares) in the Report Period
□Applicable √Not applicable
53
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
2.Change of asset and liability structure caused by change of total capital shares and structure
□Applicable √Not applicable
3.About the existing employees’ shares
□Applicable Not applicable
Ⅲ.Shareholders and actual controlling shareholder
1. Number of shareholders and shareholding
In Shares
The total number Total
Total
Total number of of preferred shar preferred shareholders
shareholders at
common eholders voting ri at the end of the month
the end of the
shareholders at 7,441 7,393 ghts restored at p 0 from the date of 0
month from the
the end of the eriod-end(if disclosing the annual
date of disclosing
reporting period any)(See Notes report(if any)(See Notes
the annual report
8) 8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Number of Number of share
Proportion Amount of Amount of
Shareholders Nature of shares held Changes in pledged/frozen
of shares restricted un-restricted
shareholder at period reporting period State of Amo
held（%） shares held shares held
-end share unt
China Military
State-owned
Equipment Group Co., 71.13% 84,906,250 0 84,906,250 0
legal person
Ltd.
Domestic
Gu Zuocheng natural 1.89% 2,261,000 0 2,218,750 42,250
person
Domestic Transferred
Hengsheng Sun Group non-state-o 1,750,000 shares
1.47% 1,750,000 1,750,000 0
Co., Ltd. wned legal of Hengsheng Sun
person Group Co., Ltd
Reduce the
Domestic
Liu Dan natural 0.77% 918,251 holding of 0 918,251
person
165,000 shares
Increase the
Domestic
Xu Yuanhui natural 0.65% 777,889 holding of 89,000 0 777,889
person
shares
Domestic
Chen Xinqiang natural 0.51% 612,400 0 0 612,400
person
54
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
CORE
Increase the
PACIFIC-YAMAICHI Overseas
0.44% 531,150 holding of 96，500 0 531,150
INTERNATIONAL Legal person
shares
(H.K.) LIMITED
Domestic
Zhang Meilan natural 0.43% 513,560 0 0 513,560
person
Domestic
Feng Yonghui natural 0.42% 500,000 0 500,000 0
person
Domestic
Increase the
Li Jianping natural 0.36% 434,500 0 434,500
holding of 5，000
person
Strategic investor or general legal person becoming
top-10 ordinary shareholder due to rights issue (if None
any)（See Note 3)
There isn’t any associated relationship between the sponsoring shareholder
and the other shareholders among the top-10 list. None of them are regarded
Related or acting-in-concert parties among
as ‘Acting in concert’ in accordance with ‘The rules of information disclosure
shareholders above
on change of shareholding.’ Foreign shareholders are unknown for their
condition of ‘Associated relationship’ and ‘Acting in concert’.
Description of the above shareholders in relation to
delegate/entrusted voting rights and abstention from Not applicable
voting rights
Top 10 holders of unconditional shares
Amount of Category of shares
unconditional
Name of the shareholder Amo
shares held at end Category of shares
of period unt
918,2
Liu Dan 918,251 Foreign shares placed in domestic exchange
51
777,8
Xu Yuanhui 777,889 Foreign shares placed in domestic exchange
89
612,4
Chen Xinqiang 612,400 Foreign shares placed in domestic exchange
00
CORE PACIFIC-YAMAICHI 531,1
531,150 Foreign shares placed in domestic exchange
INTERNATIONAL (H.K.) LIMITED 50
513,5
Zhang Meilan 513,560 Foreign shares placed in domestic exchange
60
434,5
Li Jianping 434,500 Foreign shares placed in domestic exchange
00
423,5
Chen Houping 423,561 Foreign shares placed in domestic exchange
61
55
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
418,0
Lv Gang 418,099 Foreign shares placed in domestic exchange
99
345,5
Liu Guosheng 345,575 Foreign shares placed in domestic exchange
75
335,8
Zhang Long 335,877 Foreign shares placed in domestic exchange
77
There is no affiliated relationship between the top ten non-restricted tradable
shareholders and the controlling shareholder China Military Equipment Group Co.,
Action-in-concert among top 10 Ltd. nor do they belong to the consistent actors stipulated in the Administrative
non-restricted current share holders, top 10 Measures for the Acquisition of Listed Companies; it is unknown to the company
non-restricted current share holders and top whether there is an affiliated relationship between the top ten non-restricted tradable
10 shareholders shareholders as well as between the top ten non-restricted tradable shareholders and
the other top ten shareholders, or whether they are included in the consistent actors
stipulated in the Administrative Measures for the Acquisition of Listed Companies.
Top 10 ordinary shareholders conducting
securities margin trading (if any) (see note Not applicable
4)
Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a
buy-back agreement dealing in reporting period.
□ Yes √ No
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company
have no buy –back agreement dealing in reporting period.
2.Controlling shareholder
Nature of Controlling Shareholders: Central State-owned Holdings
Type of Controlling Shareholders: Legal person
Name of the Legal
Date of
Controlling representative/L Organization code Principal business activities
incorporation
shareholder eader
Investment, operation and management of
state-owned assets: research and development,
production, guarantee and service of weapons
and equipment; Research and development,
manufacturing, sales and comprehensive services
China Military
of vehicles, electrical equipment, photoelectric
Equipment Group Xu Xianpng June 29,1999 91110000710924929L
information and products and their equipment,
Co., Ltd.
mechanical equipment, engineering and
construction machinery, chemical materials
(except hazardous chemicals), fire fighting
equipment, medical and environmental
protection equipment, metal and nonmetal
56
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
materials and their products.
Equity of other Shares held and controlled by other domestic and overseas listed companies directly
domestic/foreign listed or indirectly: 1.44.17% by Chongqing Changan Automobile Co., Ltd.; 2. 44.56 by
company with share Baoding Tianwei Baobian Electric Co., ltd.; 3.37.40% by Hunan Tianyan Machinery
controlling and share Co., Ltd.;4.51.42 by Haerbin Automobile Power Co., Ltd.;5. 55.61% by Yunnan Xiyi
participation by Industry Co., Ltd.; 6.25.44% by Chongqing Mensheng Logistic Co., Ltd.;7. 46.87%
controlling shareholder in reporting period China Optical Group Co., Ltd.; 8. 41.03% by Jiangling Automobile Co., Ltd.
Change of holding shareholder
□ Applicable √ Not applicable
None
3．Information about the controlling shareholder of the Company
Actual controller nature：Central state owned Assets Management t
Actual controller type：Legal person
Legal
Date of Principal business
Name of the controlling shareholder representative/person in Organization code
establishment activities
charge
State-owned Assets Supervision and
administration Commission of the State Not applicable Not applicable Not applicable
Council
Situation of domestic and abroad
Not applicable
holding listed companies
Changes of the actual controller in the reporting period
□Applicable √Not applicable
No Changes of the actual controller in the reporting period
Block Diagram of the ownership and control relations between the company and the actual controller
57
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
The actual controller controls the company by means of trust or managing the assets in other way
□Applicable √Not applicable
4.Particulars about other legal person shareholders with over 10% share held
□Applicable √Not applicable
5.Situation of Share Limitation Reduction of Controlling Shareholders, Actual Controllers, Restructuring Party
and Other Commitment Subjects
□Applicable √Not applicable
58
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
VII. Situation of the Preferred Shares
□Applicable √Not applicable
The Company had no preferred shares in the reporting period.
59
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
VIII Information about convertible corporate bonds
□ Applicable √Not applicable
During the reporting period, the company did not have convertible corporate bonds.
60
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
IX. Information about Directors, Supervisors and Senior Executives
I. Change in shares held by directors, supervisors and senior executives
Amount Amount
Shares of shares of shares Other Shares
held at increase decrease change held at
Office Starting date of Expiry date of the d at the d at the s the
Name Positions Sex Age
status tenure tenure year-b reportin reportin increas year-en
egin(s g g e/decr d(share
hare) period(s period(s ease )
hare) hare)
Yan
In
Xuechua Chairman Male 57 November 13,2020 May 31,2023 0 0 0 0 0
office
n
Dong In
Director Male 56 April 11,2019 May 31,2023 0 0 0 0 0
Qihong office
Employee In
Yu Jiang Male 49 March 20,2019 May 31,2023 0 0 0 0 0
director office
Zhang In
Director Male 41 April 11,2019 May 31,2023 0 0 0 0 0
Di office
Zhou
In
Yongqia Director Male 48 May 25,2016 May 31,2023 0 0 0 0 0
office
ng
In
Hao Lin Director Male 57 April 29,2008 May 31,2023 0 0 0 0 0
office
Li Independe In
Male 55 May 22,2020 May 31,2023 0 0 0 0 0
Jiaming nt Director office
Independe In
Xie Fei Male 56 May 22,2020 May 31,2023 0 0 0 0 0
nt Director office
Independe In
Liu Wei Male 56 May 22,2020 May 31,2023 0 0 0 0 0
nt Director office
Song Independe In Femal
45 May 22,2020 May 31,2023 0 0 0 0 0
Weiwei nt Director office e
Lv
Dimiss
Hongxia Chairman Male 51 March 18,2016 November 13,2020 0 0 0 0 0
ion
n
Li Independe Dimiss Male 57 May 23,2014 May 22,2020 0 0 0 0 0
61
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Dingqin nt Director ion
g
Wang Independe Dimiss
Male 58 May 25,2016 May 22,2020 0 0 0 0 0
Jun nt Director ion
Independe Dimiss Femal
Peng Jue 66 May 23,2014 May 22,2020 0 0 0 0 0
nt Director ion e
Liu Independe Dimiss
Male 39 May 23,2014 May 22,2020 0 0 0 0 0
Zhiming nt Director ion
Chairman
of the
Lu In
supervisor Male 56 November 27,2020 May 31,2023 0 0 0 0 0
Xianyun office
y
committee
Zhang In
Supervisor Male 53 April 11,2019 May 31,2023 0 0 0 0 0
Lungang office
Qiao In
Supervisor Male 56 April 11,2019 May 31,2023 0 0 0 0 0
Guoan office
Li
Employee In
Yongjian \Male 39 March 20,2019 May 31,2023 0 0 0 0 0
supervisor office
g
Rao Employee In
Male 55 March 20,2019 March 3,2021 0 0 0 0 0
Song supervisor office
Chairman
of the
Zhang Dimiss
supervisor Male 53 April 11,2019 November 27,2020 0 0 0 0 0
Lungang ion
y
committee
Jiang Dimiss
Supervisor Male 55 April 11,2019 October 29,2020 0 0 0 0 0
Chaojie ion
Yan
General Dimiss
Xuechua Male 57 March 25,2019 November 13,2020 0 0 0 0 0
Manager ion
n
Yu Deputy In
Male 54 March 25,2019 May 31,2023 0 0 0 0 0
Wenbiao GM office
Fan Deputy In
Male 49 March 25,2019 January 18,2021 0 0 0 0 0
Aijun GM office
Tan
Chief In
Mingxia Male 47 March 25,2019 May 31,2023 0 0 0 0 0
accountant office
n
Zhang Secretary In Male 33 May 17,2018 May 31,2023 0 0 0 0 0
62
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Hushan of the office
Board
Total -- -- -- -- -- -- 0 0 0 0 0
II. Change in shares held by directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Positions Types Date Reason
The chief accountant was set up according to
the newly revised Articles of Association.
His/her position was changed from deputy
Tan Mingxian DG Manager Appointed February 14,2020
general manager to chief accountant and
continued to perform the duties of financial
director.
Leaves the office
Li Dingqing Independent director at the end of his May 22,2020 Board change
term
Leaves the office
Wang Jun Independent director at the end of his May 22,2020 Board change
term
Leaves the office
Peng Jue Independent director at the end of his May 22,2020 Board change
term
Leaves the office
Liu Zhiqing Independent director at the end of his May 22,2020 Board change
term
Li Jiaming Independent director Be elected May 22,2020
Xie Fei Independent director Be elected May 22,2020
Liu Wei Independent director Be elected May 22,2020
Song Weiwei Independent director Be elected May 22,2020
Lv Hongxian Chairman Dimission November 13,2020 In case of any change of work,
Chairman of the No longer serves as Chairman of the Board of
Zhang Lungang supervisory Appointed November 27,2020 Supervisors, but retains the position of
committee Supervisor.
Supervisor, Chairman
Lu Xianyun of the supervisory Be elected November 27,2020
committee
Jiang Chaojie Supervisor Dimission October 29,2020 In case of any change of work,
Yan Xuechuan General Manager Appointed November 13,2020 The General Manager is dismissed by the
63
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Board of Directors and elected as chairman.
III. Status of service
Working experiences of current directors, supervisors, and executives
Situation by the end of 2020:
Mr. Yan Xuechuan, male, was born in September 1963, MBA, senior economist. He had served as deputy chief
economist and director of the business plan department of 5618 factory; served as deputy director and deputy
secretary of the party committee, secretary of the disciplinary committee, secretary of the party committee of 5618
factory; he was the director and party secretary of Hunan Huanan Optoelectronics (Group) Co., Ltd.; served as
Standing member of Dandong Municipal Committee of Liaoning Province, Deputy Mayor (Temporarily held) of
Dandong; served as director, party committee secretary, worker union chairman of the Company; he had served as
Director, Party Committee Secretary, Disciplinary Committee Secretary,worker union Chairman and General
Manager of Jianshe Mechanical and Electric. Currently, he serves as Chairman and party committee of the
company of the Company.
Dong Qihong, male, was born in September 1964, bachelor degree in economic management, senior engineer.
He was Former Secretary of Youth League Committee of Qingshan Machinery Factory, Deputy Director of
Motorcycle Parts Branch; Deputy Minister and Minister of Personnel and Labor Department of Chongqing
Qingshan Industrial Co., Ltd., Deputy Secretary of Party Committee, Secretary of Discipline Inspection Committee,
Chairman of Worker Union, Deputy General Manager, Director, Secretary of Party Committee of Chongqing
Qingshan Industrial Co., Ltd; he had served as Deputy General Manager and General Manager of Chongqing
Qingshan Transmission Branch of China South Industrial Automobile Co., Ltd; General Manager of Chongqing
Qingshan Industrial Co., Ltd .; Deputy Director and Director of Audit and Risk Department of China South
Industries Group Corporation; Chairman and Secretary of Party Committee of Baoding Tianwei Group Co., Ltd.;
Inspector of Audit and Risk Department, Inspector of Supervision Department, Inspector of Discipline Inspection
and Supervision Department of China South Industries Group Corporation; Supervisor of South Asset Management
Company; Chairman of Chang’an Automobile Supervisory Committee; and he was Director of Construction
Mechatronics. Currently, he is the director of China Jialing, director of Luoyang North, director of Jinan Qingqi and
director of the Company.
Yu Jiang, male, was born in April 1971, master of industrial engineering, senior engineer title of researcher
level. He used to be Deputy Director of the third construction plant of the construction group, Deputy Director of the
engine branch plant, Deputy General Manager of the engine company and the director of the 52 workshop of the
construction group; Manager of the Shenzhen Jianmo B engine company, Deputy General Manager and Director of
the quality department of the Shenzhen Jianmo B; Deputy Director of Construction Group Office, Deputy Director,
Director of Jianmo B Technology Center, and Director, Deputy General manager, Member of the party committee
of the Applied Technology Research Institute of Jianmo B Technology Center; Deputy General manager, Member
of the party committee, Deputy Secretary of the party committee, Secretary of the disciplinary committee, Chairman
of the worker union, and Director of Construction Mechatronics . He is currently the Deputy Secretary of the Party
Committee, Secretary of the Commission for Discipline Inspection, Chairman of the Worker Union, and Director of
Employees of the Company.
Zhang Di, male, was born in January 1979, master of law, assistant engineer. He used to be the deputy division
chief of first division of asset management department, deputy division chief and division chief of asset
64
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
management department of capital operation department of China South Industries Group Corporation. He is
currently the division chief of the Property Management Department of the Capital Operation Department of
Military Equipment Group and the director of the Company.
Zhou Yongqiang, male, was born in December 1972, bachelor degree in engineering management, senior
economist. He had served in China Jialing Group in posts of section chief of investment management section,
section chief of Investment Planning Section, deputy director of investment management department, Assistant
Minister of planning department and Assistant Minister of development department; he had served as Vice
Minister (executive) of enterprise development department of China Jialing Group, deputy general manager of
Chongqing Jiufang Foundry Co.,Ltd and general manager of Chongqing Jiufang Foundry Co.,Ltd; he had served
as general manager assistant with concurrent post of minister of development planning, and deputy general
manager of China Jialing Group, and minister of capital operation of Military Motorcycle. Currently, he serves as
director of corporate development department of motorcycle division of Military Equipment Group, deputy chief
economist and minister of development operation department of Military Motorcycle, director of Luoyang North
Enterprise Group, director of Ji'nan Qingqi Co., Ltd, director of Jianshe Mechanical and Electric Company and
director of the company.
Hao Lin, Male, born in 1963, Master. At present he’s Chairman of Chongqing Tongkang Technologies Co., Ltd.,
and Director of the Company. He served as Director of the Company.
Li Jiaming: male, was born in 1965, with a doctoral degree and a professor title. He was former Head of the
Teaching and Research Section of the Department of Economics II, Yuzhou University; deputy director of the
accounting department of Chongqing University School of Business Administration, deputy director of the
Disciplinary Supervision Office of Chongqing University, deputy director, director of the Audit Office of
Chongqing University, General Manager of Chongqing University Science and Technology Enterprise Group,
Director of MPAcc Center of School of Economics and Management of Chongqing University, and Executive
Deputy Dean of Chongqing University of Science and Technology of Dazi City, he served concurrently as
independent director of Chongqing Yu Development Co., Ltd, Guangxi Liugong Machinery Co., Ltd. and
Chongqing Jianshe Motorcycle Company. Currently, he is the chairman of Chongqing University Asset
Management Co., Ltd and an independent director of the Company.
Xie Fei: Male, born in 1964, doctor degree, professor title, visiting scholar at Australian National University,
and research student at Ritsumeikan University in Japan. He was a member of the Standing Committee of the
Youth League Committee of Chongqing University, a teacher and director of Chongqing Industrial Management
Institute, and a teacher and director of Chongqing Institute of Technology. Currently, he is Dean of the School of
Economics and Finance of Chongqing University of Technology, concurrently serves as Educational Inspector of
Chongqing Municipal People’s Government, Executive Director of Chongqing Finance Society, Executive
Director of Chongqing Macroeconomics, Decision Consulting Expert of Chongqing Development and Reform
Commission, Leader of Applied Economics and Asset Appraisal of Chongqing University of Technology, and he
is an independent director of Chongqing Yuxin Pingrui Electronics Co., Ltd and an independent director of the
Company.
Liu Wei: Male, born in 1964, doctoral degree, professor title, former lecturer, associate professor, assistant
dean of the first department of mechanical engineering of Chongqing University, he served as professor and
deputy director of the research institute of the School of Mechanical Engineering of Chongqing University, once
concurrently served as independent director in Chongqing Chang’an Automobile Co., Ltd. Co., Ltd, Chongqing
Science and Technology Venture Capital Co., Ltd, Chongqing Jianfeng Chemical Co., Ltd, Chongqing Angel
Investment Guidance Fund Co., Ltd, and Chongqing Zaisheng Technology Co., Ltd, and external director of
Chongqing Iron and Steel (Group) Co., Ltd. Currently, he serves as professor, doctoral supervisor, deputy director
65
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
of the research center, and department head of the School of Economics and Business Administration of
Chongqing University, concurrently serving as independent director of Chongqing Mechanical and Electrical Co.,
Ltd., Chongqing Fuling Power Industry Co., Ltd, Chongqing Three Gorges Paint Co., Ltd., and Chongqing
Zhengchuan Pharmaceutical Packaging Materials and the Company.
Song Weiwei: female, born in 1975, master degree, professor of financial management and certified public
accountant. She served concurrently as the chairman of Chongqing University of Technology Weigan Technology
Co., Ltd. Currently, she serves as professor at the School of Accounting of Chongqing University of Technology,
concurrently serving as independent director of Chongqing Chuanyi Automation Co., Ltd, SPIC Yuanda
Environmental Protection Co., Ltd, Chongqing Three Gorges Paint Co., Ltd and the Company.
Lu Xianyun, male, Han nationality, was born in November 1964. He has a postgraduate degree in business
administration and has the title of researcher-level senior engineer. He served as Minister of Manufacturing
Department, Assistant to General Manager and Minister of Human Resources, and Deputy General Manager of
Qingshan Plant, and once served as Deputy General Manager, Secretary of the Party Committee, Secretary of the
Disciplinary Committee, Chairman of the Labor Union, and Director of Chongqing Qingshan Industrial Co., Ltd,
and he was Secretary of the Party Committee of, Secretary of the Commission for Discipline Inspection,
Chairman of the Labor Union in Chongqing Qingshan Transmission Branch. Currently, he is a supervisor of
Yunnan Xiyi and the chairman of the Company's board of supervisors.
Zhang Lungang, male, was born in January 1967, university degree in financial management, senior accountant
title. He was Former financial chief accountant of 5003 Factory; Deputy division chief of the Financial
Department of Southwest Ordnance Bureau; Financial Manager of Chongqing Wanyou Kang’nian Hotel; Division
Chief of the Financial Department, Division Chief of Financial Audit Department, Division Chief of Asset
Management Department of Southwest Ordnance Bureau; Deputy General Manager, Chief Accountant of Dajiang
Industrial Group Corporation; Deputy General Manager of Chongqing Jiangtong Machinery; Director, Chief
Accountant and Secretary of the Party Committee of Chongqing Chang’an Industry (Group) Co., Ltd .; Chairman of
the Supervisory Board of Chengdu Jinlin Industrial Manufacturing Co., Ltd; Supervisor and Chairman of the
Supervisory Board of Chengdu Lingchuan Special Industry Co., Ltd.; Supervisor of the Supervisory Board of
Sichuan Huaqing Machinery Co., Ltd .; and Chairman of the Supervisory Committee of Construction Mechatronics.
He is currently the Chairman of the Supervisory Committee of Construction Mechatronics, and Supervisor of
Yunnan Xiyi Industry Co., Ltd.
Qiao Guoan, male, was born in May 1964, holding a bachelor's degree in systems engineering and a senior
engineer title. He used to be Chief of Technology Section, Chief of Integrated Management Section of Chief
Engineer's Office, Deputy Chief of Science and Technology Department, Minister of Science and Technology
Quality Department of 861 plant, Assistant General Manager, Deputy General Manager and Chief Engineer,
Director, General Manager, Deputy Secretary of the Party Committee of Hunan Yunjian Group Co., Ltd; and
Supervisor of Jianshe Mechanical and Electric . He is currently the supervisor of Yunnan Xiyi Industry Co., Ltd.
and the supervisor of Jianshe Industry and the supervisor of the Company.
Li Yongjiang, male, was born in November 1981, holding bachelor degree in mechanical engineering and
automation and the senior engineer title. He used to be Deputy Section Chief of the Engine Group of Construction
Group; Chief of Workshop Room 54, Deputy Chief of Machine Shop of Manufacturing Department, Director of
Precision Management Office of Jianmo B Engine Business Department; Practice Section Chief of Chongqing
Jianya casting section; Deputy Director of the Jianmo B press welding workshop; Deputy Minister of the production
management department; Deputy Minister of the construction machinery manufacturing management department;
Deputy Division Chief of the manufacturing department of Chang’an Automobile Yubei Factory (Concurrent
66
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Post). He is currently the Vice Chairman of the Company's worker union, Minister of the party and mass work
department, and Employee Supervisor.
Rao Song, male, was born in October 1965, bachelor degree in business management, accountant title. He was
former accountant of Construction Group; Finance Minister of Hubei Shenfeng Construction Motorcycle Company;
Finance Minister of Construction Mastery Motorcycle Company; Finance Minister of Ningbo Construction
Motorcycle Company; Finance Minister of Jianmo B Chengche Company; Deputy Division Chief of Price
Department of Chongqing Jianshe Motorcycle Sales Company, Executive Member of Pingshan Taikai Executive
Committee, Deputy Minister of Finance Headquarter; Deputy Minister of Jianshe Jianshe Mechanical and Electric
Finance Department; and Minister of Finance of Jianshe Vehicle B . He is currently the Deputy Director of the
Company's audit risk department (Chairing the work) and Employee Supervisor of the Company.
Yu Wenbiao, male, was born in November 1966, bachelor's degree in automatic machinery, senior engineer
title of researcher. He used to be Former Deputy Director of Workshop 61 of Construction Group, Deputy Division
Chief of Quality Assurance Division of Firearms Company, Deputy Director of Firearms Research Institute, Deputy
Minister of Development Planning Department, Director of Beijing Office, Director of Economic Operation
Department of Development Planning Department, Deputy Minister of Development Planning Department
(Hosting), Minister of Development Planning Department, Minister of Joint Venture Cooperation Management
Department, Assistant General Manager, Minister of Asset Operation Department; Secretary of the Board of
Directors of Jianmo B; Deputy General Manager of Zhuzhou Jianya; Deputy General Manager, Member of the
Party Committee of Jianmo B; Deputy General Manager, Party Committee Member; and Company Director of
Jianshe Mechanical and Electric . Currently, he is the Deputy General Manager of the Company.
Fan Aijun, male, was born in July 1971, postgraduate degree of business management, engineer. He had served as
workshop technician, office secretary, deputy director of general administration, and deputy chief of staff of
Construction Group; he had served as vice general manager of Pan India Construction Co., Ltd, section chief of
overseas business section of Chongqing Jianya, deputy chief, and section chief of matching section, and section
chief of matching section of automobile division of the company; he had served as vice general manager, and
general manager of automotive air-conditioner compressor division, and he had served as vice general manager of
the company; currently, he serves as deputy party secretary of Jianshe Mechanical and Electric Company, and he
is the general manager and director of the company. he served as Deputy General Manager of the Company.
Mr. Tan Mingxian, male, was born in May 1973, bachelor degree in accounting, senior accountant, Chinese
Certified Tax Agent, Certified Management Accountant (CMA). He had served as Supervisor, Deputy Minister and
Minister of Finance Department of Chongqing Wangjiang Industrial Co., Ltd.; served as Chief Accountant of
Sichuan Xiguang Industrial Group Co., Ltd; severed as Deputy Minister of Finance Department of Chongqing
Chang’an Industrial Group Co., Ltd.; severed as Deputy Chief Accountant of Chongqing Wangjiang Industrial Co.,
Ltd; he was a supervisor of supervisory board of China Jialing, Jianmo B, Jinan Qingqi, and Luoyang North; he
had served as Office Director of Southern Motorcycle Supervisory Affairs Office; severed as Chief Financial
Officer of Chongqing Southern Motorcycle Technology R&D Co., Ltd. Currently, he is the chief accountant of
Construction Electromechanical; he is a director of the Company. he served as Chief accountant of the Company.
Mr. Zhang Hushan, male, was born in August 1987, bachelor degree, political engineer title. He had served as the
operation administrator in the company's business planning department and secretary of the league branch of the
business cooperation group (during the period of 2011.08~2013.02, worked in the capital operation department of
67
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
China South Industries Group Corporation); served as the general affairs officer of the company office, and he was
the member of the Youth League Committee and the secretary of the league branch of the second group; he had
severed as deputy minister of the Business Planning Department and deputy minister of the Automotive Air
Conditioning Business Planning Department. Currently, he is the deputy minister of the company's business
planning department (the secretary-general office) and the deputy director of the secretary-general office; and he is
the secretary of the Board of the Company.
Office taking in shareholder companies
√Applicable □Not applicable
Does he /she
receive
Names of the
Titles engaged in Sharing date of office Expiry date of office remuneration
persons in Names of the shareholders
the shareholders term term or allowance
office
from the
shareholder
Chongqing Jialing Industrial Co.,
Dong Qihong Director October 10,2018 August 17,2020 Yes
Ltd.
Dong Qihong ,Luoyang North Director October 10,2018 Yes
Dong Qihong Jinan Qingqi Director December 3,2018 Yes
Operation Dept property
Management Office ,Military
Zhang Di Director December 3,2018 Yes
Equipment Group. Operation
Dept property Management Office
Director of
Zhou Southern Motorcycle (subsidiary Enterprise
July 1,2013 Yes
Yongqiang of the holding shareholder) Development
Dept
Zhou Chongqing Jialing Industrial Co.,
Director April 7,2016 August 17,2020 Yes
Yongqiang Ltd.
Zhou
Luoyang North, Jinan Qingqi April 7,2016 Yes
Yongqiang
Chairman of the
Zhang Lungang Jianshe Industry board of November 6,2017 Yes
supervisors
Zhang Lungang Yunnan Xiyi Industry Co., Ltd. Supervisor November 6,2017 Yes
Qiao Guoan Yunnan Xiyi Industry Co., Ltd. Supervisor January 3,2018 October 22,2020 Yes
Qiao Guoan Jianshe Industry Supervisor January 3,2018 Yes
Lu Xianyun Yunnan Xiyi Supervisor November 10,2020 Yes
Offices taken in other organizations
√Applicable □Not applicable
68
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Take
remuneration
Names Name of the parties Positions Job started Job ended
s from the
party
Chongqing Tongkang Technology
Hao Lin Chairman July 1,1999 Yes
Co., Ltd.
Chongqing University Assets
Li Jiaming Chairman July 1,2019 Yes
Management Co., Ltd.
Chongqing University of
Professor,
Xie Fei Technology School of Economics January 4,2016 Yes
President
and Finance
Director,
Chongqing University of School
Department of
Liu Wei of Economics and Business April 2,2001 Yes
Enterprise
Administration
Mangement,Ph.D
Song Weiwei Accounting School of CQUT Professor July 3,2000 Yes
Punishments to the current and leaving board directors, supervisors and senior managers during the report period
by securities regulators in the recent three years
□ Applicable √Not applicable
IV. Remuneration to directors, supervisors and senior executives
Decision-making procedures, basis for determination and actual payment of the remuneration to directors ,
supervisors and senior executives
The Company gives rewards to executives on annual basis which consist of basic annual rewards and performance
rewards. Basic annual rewards are paid on monthly basis and performance rewards are distributed basing on the
Remuneration of directors, supervisors, and executives in the report period
In RMB10,000
Total Remuneration
remuneration actually receives
Name Positions Sex Age Office status
received from the at the end of the
shareholder reporting period
Yan Xuechuan Chairman Male 57 In office 40.3 No
Dong Qihong Director Male 56 In office 16.1 Yes
Yu Jiang Employee director Male 49 In office 35.7 No
Zhang Di Director Male 41 In office 0 Yes
Zhou Yongqiang Director Male 48 In office 0 Yes
Hao Lin Director Male 57 In office 0 Yes
Li Jiaming Independent Director Male 55 In office 1.5 No
Xie Fei Independent Director Male 56 In office 1.5 No
69
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Liu Wei Independent Director Male 56 In office 1.5 No
Song Weiwei Independent Director Female 45 In office 1.5 No
Lv Hongxian Chairman Male 51 Dimission 37.7 No
Li Dingqing Independent Director Male 57 Dimission 1.5 No
Wang Jun Independent Director Male 58 Dimission 0 No
Peng Jue Independent Director Female 66 Dimission 1.5 No
Liu Zhiqiang Independent Director Male 39 Dimission 1.5 No
Chairman of the
Lu Xianyun Male 56 In office 4.4 Yes
supervisory committee
Zhang Lungang Supervisor Male 53 In office 19.8 Yes
Qiao Guoan Supervisor Male 56 In office 15.2 Yes
Li Yongjiang Employee Supervisor Male 39 In office 27.1 No
Rao Song Employee Supervisor Male 55 In office 19.7 No
Jiang Chaojie Supervisor Male 55 Dimission 0 Yes
Yu Wenbiao DG Manager Male 54 In office 35.6 No
Fan Aijun DG Manager Male 49 In office 35.3 No
Tan Mingxian Chief accountant Male 47 In office 35.5 No
Zhang Hushan Secretary of the Board Male 33 In office 28.2 No
Total -- -- -- -- 361.1 --
Incentive equity to directors, supervisors or/and senior executives in the reporting period
□Applicable√Not applicable
V. Particulars about employees.
1. Staff jobs, education, job title number and proportion refer to the following pie chart:
Number of in-service staff of the parent company（person） 305
Number of in-service staff of the main subsidiaries（person） 639
Total number of the in-service staff（person） 944
Total number of staff receiving remuneration in the current
944
period（person）
The number of the parent company and the main subsidiary’s
147
retired staffs who need to bear the cost（person）
Professional
Classified according by Professions Number of persons（person）
Production 568
70
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Sales 37
Technical 203
Financial 30
Administrative 106
Total 944
Education
Classified according by Professions Number of persons（person）
Mid-school or below 361
Colleges or above 260
Universities or above 298
Postgraduate or above 25
Total 944
2. Remuneration policies
The mode of piecework wage for production personnel was carried out. Sales commissions are employed to
sales personnel. Other employees will enjoy the basic broadband salary. The salary of employees is closely related
to individual performance, department performance and company operating results.
3.Training plan
In 2020, the Company organized 147 training sessions throughout the year, including 87 internal trainings and 60
outside training sessions with a total of 4，960 person-times in trained and the total training hours reached 28，738
hours. The average training hours per employee of the Company reached 32 hours and the Company
comprehensively completed the Company's annual training plan In the year, it completed 339 person-times
post-operation (Undertake post or post transfer) training and appraisal assessments for production operation
employees, and issued qualification certificates for the staff; It provided an online learning platform to open
multi-disciplinary self-learning courses for company employees. As of the end of the year, the per-person learning
hours reached 73 hours.
4. Outsourcing situation
□ Applicable √ Not applicable
71
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
X. Administrative structure
I.Basic state of corporate governance
In accordance with the Guidelines for the Governance of Listed Companies and other laws and regulations,
the company has continuously improved its governance mechanism and established an effective governance
structure, with clear rights and obligations of shareholders, directors, supervisors and senior executives, which can
ensure that shareholders fully exercise their legal rights, ensure that the Board of Directors is responsible to the
company and shareholders, and ensure the transparency of major information disclosure, legal operation and
honesty and trustworthiness of the company. There is no significant difference between the actual situation of
corporate governance and the normative documents on governance of listing companies issued by China
Securities Regulatory Commission.
Does there exist any difference in compliance with the corporate governance , the PRC Company Law and the
relevant provisions of CSRC,
□ Yes √No
There exist no difference in compliance with the corporate governance , the PRC Company Law and the relevant
provisions of CSRC.
II. Independence and Completeness in business, personnel , assets, organization and finance
The Company is completely separate from the holding shareholder in aspects of business, asset, finance, and
organization. It has its independent business operation.
1. Business: The Company has independent and complete development, purchase, production and marketing
system. The Company is capable to perform business operation independently.
2. Personnel: The Company established independent functional department responsible for labor, personnel and
wage management and formed labor, personnel and wage management system.
3. Asset: The Company’s assets are independent and complete. The assets are registered, booked, accounted, and
administrated independently.
4. Organization: The Company has established an organizational structure that is independent of its controlling
shareholder. The organs of the Company are able to exercise their functions independently.
5. Finance: The Company has set up independent finance department, formed independent financial accounting
system, established and perfected financial control system and internal control measures, opened independent
bank accounts and paid taxes independently.
III. Competition situations of the industry
□ Applicable √ Not Applicable
IV. Annual General Meeting and Extraordinary Shareholders’ Meetings in the Reporting Period
1.Annual General Meeting
Sessions Type Investor Meeting Date Disclosure date Disclosure index
72
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
participation
ratio
For details please find the
The First
Provisional Resolutions of the first
Extraordinary
shareholders’ Extraordinary Shareholders’
shareholders’ 74.45% February 14,2020 February 15,2020
General Meeting of 2020, Announcement
General meeting in
meeting 2020-009 at
2020
http://www.cninfo.com.cn
For details please find the
Annual
Resolutions of Shareholders’
Annual General Shareholders’
74.45% May 22,2020 May 23,2020 Meeting 2019, Announcement
Meeting of 2019 General
2020-055 at
Meeting
http://www.cninfo.com.cn
For details please find the
The Second
Provisional Resolutions of the second
Extraordinary
shareholders’ Extraordinary Shareholders’
shareholders’ 74.45% November 27,2020 November 28,2020
General Meeting of 2020, Announcement
General meeting in
meeting 2020-088 at
2020
http://www.cninfo.com.cn
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √Not applicable
V. Responsibility performance of independent directors in report period
1. The attending of independent directors to board meetings and shareholders’ general meeting
The attending of independent directors
Failure to
Number of Number of Number of
personally
Board meetings Number of meetings Number of attendance at
Independent Number of attend board
necessary to be spot attended by attendances by general
Directors absence meetings
attended in the attendances Communicatio representative meetings of
successively
reporting period n shareholder
twice (Yes/No)
Li Dingqing 3 3 0 0 0否 2
Wang Jun 3 1 0 2 0否 2
Peng Jue 3 3 0 0 0否 2
Liu Zhiqiang 3 3 0 0 0否 2
Li Jiaming 5 3 2 0 0否 1
Xie Fei 5 3 2 0 0否 1
73
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Liu Wei 5 3 2 0 0否 1
Song Weiwei 5 3 2 0 0否 1
Notes to failure to personally attend Board Meetings Successively Twice
2.Objection of independent directors on some relevant issues
Objection of independent directors on some relevant issues
□ Yes √No
Independent directors proposed no objection against the relevant matters in the reporting period.
3. Other notes to duty performance of independent directors
Has an independent director’s advice to the Company been accepted
√Yes □No
Explanation on acceptance of or failure to accept an independent director’s advice to the Company.
In 2020, the company's independent directors learned about the company's production and operation through
field investigation, consulting the company's information and listening to reports, and paid attention to the impact
of COVID-19 on the company's production and operation, the construction of internal control system, and the
management of subsidiaries. It provided professional advice and management suggestions to the Board of
Directors on major decision-making matters of the company in their respective professional fields, including the
"14th Five-Year Plan" of the company, financial expense control, performance incentives of managers, etc. The
company listened carefully to and adopted the suggestions of independent directors, constantly improved and
upgraded the management level, and further promoted the healthy development of the company.
VI. Duty Performance of Special Committees under the Board of Directors in the Reporting Period
Fulfilling of duties of the committees from the date of previous annual report to the date before this report:
(I) The Auditing Committee held four meetings according to the Auditing Committee Working Criteria and
Auditing Committee Annual Report Working Procedures. They were:
1. The Audit Committee of the Company held its third meeting in 2020 on October 19, 2020. The meeting
reviewed the qualifications of the proposed re-appointment of the accounting firm Zhongxingcai Guanghua
Certified Public Accountants LLP (special general partnership) (hereinafter referred to as Zhongxingcai), and
formed the following opinions:
Zhongxingcai has the ability and experience to provide audit services for listed companies. It believes that it
has adhered to the principle of independent audit in the practice process, objectively, fairly and fairly reflected the
company's financial situation and operating results, and earnestly fulfilled the duties of audit institutions, which
could meet the requirements of the company's audit work. It is agreed to re-appoint Zhongxingcai as the auditor of
the company's 2020 financial statements and internal control, and submit the matter to the Board of Directors of
the company for deliberation.
2. The Audit Committee of the company held its first meeting in 2021 on January 8, 2021, and voted on the
following items:
（1） Opinions on the 2020 annual financial statements prepared by the Company's finance department
The meeting reviewed the 2020 financial statements provided by the company's Finance Department. The
74
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
meeting held that the preparation of the company's accounting statements met the requirements of the Accounting
Standards for Business Enterprises and other relevant regulations, and the accounting policies and accounting
estimates basically reflected the company's assets, operations and cash flows, and agreed to submit them to an
accounting firm for preliminary examination.
(2) Comments on the overall audit strategy for the 2020 Annual Financial Statement
The meeting reviewed the "Overall Audit Plan" prepared by the Company's annual audit accountant,
According to the requirements of the "Working Rules for the Annual Report of the Audit Committee of the
Board of Directors", communication with the Project Manager of Zhongxingcai Guanghua Certified Public
Accountants LLP (Special General Partnership) on the Company's annual audit work was conducted, and the
"General Auditing Strategy for the 2020 Annual Financial Statement of Chongqing Jianshe Vehicle System Co.,
Ltd." was reviewed, it is believed that The "Overall Audit Strategy" compiled by the audit project team pays full
attention to the development of the automobile industry and the risk factors such as the Company's operating
conditions, governance structure, internal control system, etc., makes a reasonable risk assessment of the
Company, and the proposed audit strategy is targeted, making full preparations for completing the audit task and
reducing the audit risk. It is agreed to submit the "General Auditing Strategy for the 2020 Annual Financial
Statement of Chongqing Jianshe Vehicle System Co., Ltd." to the Board of Directors for deliberation.
(3) Opinions on the company's estimated daily related transactions in 2021
In 2021, the company plans to conduct daily related transactions such as purchasing and selling raw materials,
products and parts with related parties such as Jianshe Electromechanical, Jianshe Industry, Chang'an Automobile
and its affiliated enterprises, Chongqing Jianya, South Intel, Jianshe HANON, Minsheng Logistics and its
affiliated enterprises, Southwest Company, etc., with an estimated total amount of RMB 224 million. Upon
examination, the above-mentioned related parties have good performance ability, the above transactions are fair
transactions based on market prices, without harming the interests of the company, and it is agreed to submit the
Proposal on the Company's Estimated Daily Related Transactions in 2021 to the Board of Directors for
deliberation.
(4) Opinions on the provision for impairment of assets in 2020
After the asset impairment test of the Company and its wholly-owned subsidiaries Chongqing Jianshe
Vehicle Air Conditioner Co., Ltd. and Chongqing Pingshan Taikai Carburetor Co., Ltd., with the base day of
December 31, 2020, the impairment provision for accounts receivable, other accounts receivable, inventory and
fixed assets within the scope of the consolidated financial statements for 2020 is RMB 12.6411 million. This
accrual complies with the Accounting Standards for Business Enterprises and relevant accounting policies of the
Company, and can truly and fairly reflect the assets and financial status of the Company. It is agreed that the
provision for asset impairment in 2020 is RMB 12.6411 million and submitted to the Board of Directors for
deliberation.
3. The Audit Committee of the Company held its second meeting in 2021 on March 10, 2021, and the
meeting reviewed and approved the Audit Plan of the Company in 2021.
4. The Audit Committee of the company held its third meeting in 2021 on April 8, 2021. The meeting
reviewed the following matters and put forward opinions:
(1) Financial audit report in 2020
The Audit Committee of the Company communicated with and urged the accounting firm during the annual report
audit period. On April 8, 2021, Zhongxingcai Guanghua Certified public Accountants LLP submitted the
preliminary examination opinions of financial statements to the company. The meeting concluded that the
preparation of the company's financial statements in 2020 met the requirements of the Accounting Standards for
75
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
Business Enterprises, all expenditures were reasonable, and the recognition of income, expenses and profits
complied with laws, regulations and relevant systems, which truly and completely reflected the company's
financial position, operating results and cash flow, and agreed to submit them to the Board of Directors of the
company for deliberation.
(2) Suggestions on renewing the employment of accounting firms for the summary of accounting firms' audit
work in 2020
The meeting also summarized the audit work of the accounting firm in 2020, and held that Zhongxingcai
Guanghua Certified public Accountants LLP performed due diligence in the audit of the company's financial and
internal control in 2020, and could abide by the professional ethics of accounting firms in accordance with the
requirements of Chinese CPA Auditing Standards, and express opinions on the company's accounting statements
objectively and fairly. In order to maintain the continuity of the company's financial statements and internal
control audit work, it is suggested to continue to employ Zhongxingcai Guanghua Certified public Accountants
LLP as the company's 2021 financial statements and internal control audit work. According to the merger scope of
the company and based on the professional market situation of accounting firms in the industry, it is suggested
that the audit fee for financial statements be RMB 450,000 and the audit fee for internal control be RMB 150,000.
(3) 2020 Internal Control Evaluation Report
According to the accreditation criteria of major and important defects in internal control of financial reports
of the company, there are no major and important defects in internal control of financial reports of the company on
the base date of internal control evaluation report. According to the accreditation criteria of major and important
defects in internal control of non-financial reports of the Company, on the base date of internal control evaluation
report, the Company has been found with no major defects and important defects in internal control of
non-financial reports. It is considered that the company has maintained effective internal control in all major
aspects in accordance with the requirements of the enterprise internal control standard system and relevant
regulations.
(4) Review and approve the Measures for Overall Risk Management of the Company.
(II) The Strategy Committee of the Board of Directors of the Company held two meetings this year in
accordance with the "Detailed Rules for the Work of the Strategy Committee", details are as follows:
1. The Strategy Committee held its first meeting in 2021 on January 8, 2021. The meeting issued audit
opinions on the following matters:
(1) The fixed assets investment budget of the company (including wholly-owned air-conditioning company)
is RMB 17.8955 million, among which, the intelligent transformation project of partial assembly and machining
production line of rotary vane compressor is a continuation project in 2020, with a planned investment of RMB
4.8955 million. The construction project of dynamic and static disk production line of electric compressor is with
a planned investment of RMB 5 million. Small-scale technical measures are with a planned investment of RMB 8
million.
(2) The meeting studied and put forward opinions on the 2021 financing plan according to the needs of the
Company's business development:
It is suggested that the air conditioning company, a wholly-owned subsidiary of the Company, apply to banks
and other financial institutions for comprehensive credit line in 2021 with a total amount of no more than 610
million yuan, which can be recycled within the comprehensive credit line.
（3）(3) With reference to the use of funds in the previous year and according to the capital demand of the
air-conditioning company in 2021, the meeting suggested that the company provide the air-conditioning company
with a total guarantee amount of no more than RMB 610 million, and within the annual total guarantee amount,
76
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
part of the guarantee amount can be recycled.
2. On April 8, 2021, the Strategy Committee held its second meeting in 2021. The meeting discussed the
outline of the 14th Five-Year Plan and the overall business objectives in 2021.
(III) The Remuneration and Assessment Committee of the Board of Directors of the Company held two
meetings this year according to the Working Rules of the Remuneration and Assessment Committee, as follows:
1. On August 27, 2020, the Remuneration and Assessment Committee held its second meeting in 2020. The
meeting reviewed the Administrative Measures on Remuneration of Managers of Chongqing Construction
Automobile Systems Co., Ltd., the Administrative Measures on Performance of Managers of Chongqing
Construction Automobile Systems Co., Ltd., the Annual Performance Contract of Managers and the Employment
Performance Contract of Managers, and agreed to submit them to the Board of Directors for deliberation.
2. On April 8, 2021, the Remuneration and Assessment Committee held its first meeting in 2021. The
meeting reviewed the performance of directors and senior management of the company in 2020 and carried out
annual performance assessment. The opinions of the meeting are as follows:
In 2020, there were 19 directors (including independent directors) and senior managers who received
remuneration in the company. According to the completion of the company's main financial indicators and
business objectives in 2020, combined with the completion of the above-mentioned personnel in charge of work
indicators and the assessment of their business capabilities, it was considered that the remuneration level of the
company's directors and senior managers in that year was in line with the provisions of the company's Evaluation
and Incentive System for Senior Managers, and it was agreed that the total remuneration paid by the company was
RMB 3.413 million.
(IV) The Nomination Committee of the Board of Directors of the Company held three meetings this year in
accordance with the "Working Rules of the Nomination Committee", specifically:
1. The Company's nomination committee held the third meeting of 2020 on May 9, 2020, and agreed to
recommend Yan Xuechuan as the general manager.
2. The Company's nomination committee held the fourth meeting of 2020 on November 9, 2020, and agreed
to recommend Yan Xuechuan as the chairman.
3. The nomination committee of the Company held its first meeting of 2021 on January 8, 2021, and agreed
to recommend Fan Aijun as a candidate for director and general manager.
VII. Work of the supervisory Committee
Did the supervisory Committee find any risk existing in performing the supervision activities in the reporting
period
□Yes √No
The supervisory Committee has no objection agent any matters under supervision in the reporting period
VIII. Assessment and incentive Mechanism for Senior executives
The Company gives rewards to executives on annual basis which consist of basic annual rewards and performance
rewards. Basic annual rewards are paid on monthly basis and performance rewards are distributed basing on the
annual assessment on their performances and duties as well as democratic assessment.
77
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
IX. Internal control situations
1.Specific situations on major defects of internal control discovered during report period
□ Yes √ No
2.Self-evaluation report on internal control
Disclosure date of appraisal report on internal
April 30,2021
control
Disclosure index of appraisal report on internal
Juchao Website:（http://www.cninfo.com.cn），Announcement No.2021-018
control
Proportion of total unit assets covered by
appraisal in the total assets of the consolidated 91.84%
financial statements of the company
Proportion of total unit incomes covered by
appraisal in the total business incomes of the
94.66%
consolidated financial statements of the
company
Standards of Defects Evaluation
Category Financial Report Non-financial Report
Indicator 1: General defects in
General defects: ① Minor financial loss;
company’s daily operation. It’s almost
② Minor misstatement or omission of
impossible that some specific business
statement in terms of financial statement; ③
fails to operate normally. Other business
Minor damage of reputation caused by its
activities and achievement of business
negative influence in some regions. Serious
goals will not be affected. Serious
defects: ① Bring some financial loss to
defects: It’s reasonably possible that
company; ② Cause moderate misstatement
normal operations of some business may
or omission of statement in terms of
be influenced but it will not affect the
financial statement; ③ Serious damage of
sustainable operation of our company.
reputation caused by its comparatively
Qualitative standard Significant defects: it’s reasonably
large-scale influence in some regions.
possible that operation capacity of some
Significant defects: ① Bring significant
business may be lost and it will endanger
financial loss to company; ② Significant
the company’s sustainable operation.
misstatement or omission of statement in
Indicator 2: Financial loss. General
terms of financial statement; ③ The
defects: It’s almost impossible that minor
significantly negative influence has attracted
financial losses may be led to company.
large-scale attention by the public and
Serious defects: It’s reasonably possible
unrecoverable losses have been brought to
that moderate financial losses may be led
company.
to company. Significant defects: It’s
possible that significant financial losses
78
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
may be led to company. Indicator 3:
Reputation of company. General defects:
It’s almost impossible that the negative
information popular in some regions will
be caused, which may further affect
company’s reputation. Serious defects:
It’s reasonably possible that the negative
information popular in some regions will
be caused, which may lead moderate
influence to company’s reputation.
Significant defects: It’s reasonably
possible that the negative information
popular in some regions will be caused,
which may lead significant influence to
company’s reputation.
Indicator: The proportion of misstatement in Indicator: The proportion of financial
the overall assets. General defects: It’s losses in the overall assets. General
almost impossible that the amount of defects: It’s almost impossible that the
misstatement accounting for 0.05% of the amount of financial losses accounting for
overall assets or less will occur. Serious 0.05% of overall assets or less will occur.
defects: It’s reasonably impossible that the Serious defects: It’s reasonably possible
Quantitative criteria amount of misstatement accounting 0.05% to that the amount of financial losses
1% of the overall assets will occur. accounting for 0.05% to 1% of the
Significant defects: It’s reasonably possible overall assets will occur. Significant
that the amount of misstatement accounting defects: It’s reasonably possible that the
for 1% of the overall assets or more will amount of financial losses accounting for
occur. 1% of the overall assets or more will
occur.
Number of major defects in financial
0
reporting（a）
Number of major defects in non financial
0
reporting (a)
Number of important defects in financial
0
reporting（a）
Number of important defects in non
0
financial reporting（a）
X. Internal Control audit report
√ Applicable □Not applicable
Review opinions in the internal control audit report
79
Chongqing Jianshe Vehicle System Co., Ltd. 2020 Annual Report
We acknowledge that Chongqing Jianshe Vehicle System Co., Ltd. has been conducting effective internal control in all material
aspects complying with “Fundamental Rules of Enterprise Internal Control” .On December 31,2020.
Disclosure date of audit report
Disclosure
of internal control (full-text)
Index of audit report of
April 30,2021
internal control (full-text)
Internal audit report’s opinion Juchao Website: （http://www.cninfo.com.cn），Announcement No.2021-034
Type of audit report on internal
Unqualified auditor’s report
control
Whether there is significant defect
No
in non-financial report
Has the CPAs issued a qualified auditor’s report of internal control .
□ Yes √No
Does the internal control audit report issued by the CPAs agree with the self-assessment report of the Board of
Directors
√Yes □No
XI. Corporation bonds
Whether or not the Company public offering corporation bonds in stock exchange, which undue or without
payment in full at maturity on the approval date for annual report disclosed
No
80
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
XII.. Financial Report
I. Audit report
Type of auditing opinion Unqualified audit opinion
Date of issue of the Auditors’ Report April 28 ,2021
Name of the CPA Zhongxingcai Guanghua Certified public Accountants LLP.
Ref. No. of the Auditors’ Report ZXCGHSKZ（2021）No.302053
Name of the certified accountants Fan Rui, Zhang Weidong
Chongqing Jianshe Vehicle System Co.,Ltd.
（second-class）
Auditors' Report
Z.X.C.G.H.S.K.Zi [2021]No.302053
Zhongxingcai Guanghua Certified Public
Accountants LLP
（Special General Partnership）
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Contents
Auditors' Report
Consolidated Balance Sheet and the Company's Balance Sheet
Consolidated Income Statement and the Company's Income
statement
Consolidated Statement of Cash Flows and the Company's
Statement of Cash Flows
Consolidated Statement of Changes in Owners' Equity and the
Company's Statement of Changes in Owners' Equity
Notes to the Financial Statements
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Auditors' Report
Z.X.C.G.H.S.K.Zi [2021]No.302053
To all Shareholders of Chongqing Jianshe Vehicle System Co., Ltd.：
Ⅰ. Audit opinion
We have audited the accompanying financial statements of Chongqing Jianshe
Vehicle System Co., Ltd. (hereinafter referred to as "Chongqing Jianshe"), which
comprises the consolidated balance sheet and the company’s balance sheet as on
December 31, 2020, the consolidated Income Statement and the Company's Income
Statement, the consolidated statement of cash flows and the Company's statement of
cash flows, the consolidated statement of changes in owners' equity and the
company's statement of changes in owners' equity for the year then ended, and the
notes to the financial statements.
In our opinion, the financial statements of Chongqing Jianshe present fairly, in all
material respects, the company's and consolidated financial position as of 31
December 2020, and the company's and consolidated results of operations and cash
flows for the year then ended in accordance with Accounting Standards for Business
Enterprises.
II. Basis for Opinion
We conducted our audit in accordance with Standards on Auditing for Certified
Public Accountants. Our responsibilities under those standards are further described
in the Auditor’s Responsibilities for the Audit of the Financial Statements section of
our report. In accordance with professional ethics for certified public accountants, we
are independent with Chongqing Jianshe and we have fulfilled our other ethical
responsibilities. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
1
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
III. Key Audit Matters
Key audit matters are matters that we consider to be the most important in the audit of
the current financial statements based on our professional judgement. These matters
should be addressed against the background of an audit of the financial statements as
a whole and the formation of an audit opinion, and we do not express an opinion on
these matters separately. We have identified the following as key audit matters that
need to be communicated in the audit report.
1. Key Audit Matters：Income Confirmation
（1）Item Description
Please refer to Note 2.32 of Annotation 2、Important Accounting Policies and
Accounting Estimation of the Financial Statement and Note 4.31 of Annotation 4、
Operating Income and Operating Costs for related information disclosed.
The operating income of Chongqing Jianshe in 2020 was 741 million Yuan, fell by
6.40%, compared with one year earlier was 791 million Yuan, which is an important
component of the consolidated income statement. Among them, the sales revenue of
Chongqing Jianshe Automobile A/C accounts for 96.98% of the operating income in
2020 and decreased slightly compared with 98.70% of the operating income in 2019,
which is divided into three categories according to customer groups:
Big customer. The mode of cooperation is mainly according to the customer's
production needs; the company will ship the goods to the designated or cooperative
tripartite logistics company, which is responsible for the warehousing and distribution
services. Each month, the customer would issue a hang account notice according to
the actual consumption of the production plan, sales clerk issued a letter of notice for
invoices according to the customer's bill hang notice combined with customer
consumption, contract unit price and hang account notice, etc., The finance
department shall issue invoices to confirm the sales income.
Customers - Delivery after payment. Sales personnel confirm upon receipt of payment
by the customer, in accordance with customer requirements and related information of
2
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
bill, the contract of sale price and customer demand quantity shipment, and issue a
letter of notice, then the finance department completes the transaction.
Customers - After-sales market. Sales personnel deliver the goods to the customer
according to the contract and customer demand. After arrival time node of the
contract, sales personnel issues a letter of notice according to the contract unit price
and shipment quantity, and the finance department issues invoices to confirm the sales
revenue.
Operating income is one of the key performance indicators of Chongqing Jianshe. The
revenue recognition type is various and complicated. Therefore, we identified the
operating income to key audit matters for the company.
（2）Countermeasures of Audit
Our main countermeasures of audit for the income of the above key audit are as
follows:
1）We selected big sales contracts, reviewing the relevant terms of the contract, and
interviewed the management; in the meantime, we analyzed the contract by using
"five-step" of new revenue standard, judged the composition of performance
obligations and the time point of control transfer, and then evaluated whether the sales
revenue recognition policy meet the requirements of the new revenue criteria
2）We conducted interviews with management and governance to assess the risk of
integrity and fraud.
3）We understudied and tested the internal controls associated with income, and
determined it's reliable.
4）Perform analytical procedures on revenue and cost, including: the analysis of
monthly income, cost and fluctuation of gross profit in current period, comparison
analysis of the main product’s current income, cost and gross profit with previous
period, to judge the rationality of sales revenue and gross profit rate changes.
5）Execution of detail test, we have sampled the inventory receipt and sending records,
sales contracts, sales orders, sales invoices, shipping documents, bills of current
account and receipt document and other supporting documents, checked receipt
3
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
records, done external confirmation for final accounts receivable, and confirmed the
authenticity of sales revenue.
6）For confirmed sales revenue of products as balance sheet date, we have checked the
delivered note of inventories, transport document, receiving reports of customer and
other documents, and audit integrality of sales revenue and so on.
7）We checked the information of operating income presented in the financial
statements and notes.
2． Key Audit Matters：Acquisition of 50% equity of Chongqing Pingshan TK
Carburetor Co., Ltd.
（1）Item Description
Details of the disclosure of the relevant information can be found in the annotation 2、
Important Accounting Policies and Accounting Estimation of the Financial Statement
the financial statements, "4, consolidated financial statement items" 4.8-Long-term
Equity Investment.
Chongqing Pingshan TK Carburetor Co., Ltd. was a joint venture of Chongqing
Jianshe, holding 50% of the shares. On April 24, 2020, Chongqing Jianshe planned to
acquire 50% of the equity held by the foreign shareholders. After the acquisition,
Chongqing Jianshe holds 100% of the equity of Chongqing Pingshan TK Carburetor
Co., Ltd. and realized the control, which becomes a wholly-owned subsidiary of
Chongqing Jianshe, and included it in the scope of consolidated statements. The
method of long-term equity investment in Chongqing Pingshan TK Carburetor Co.,
Ltd. is changed to cost method instead of equity method.
On April 24, 2020, the 22nd Meeting of the 8th board of directors of Chongqing
Jianshe approved the acquisition of 50% equity of Chongqing Pingshan TK
Carburetor Co., Ltd. It was proposed to sign the equity transfer contract with Yamaha
Motor Co., Ltd., Aisan Industry Co., Ltd. and TK Carburetor Co., Ltd. to purchase
20%, 25% and 5% equity of Chongqing Pingshan TK Carburetor Co., Ltd. with 1 US
dollar respectively.
4
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
On May 22, 2020, Chongqing Jianshe's 2019 annual general meeting of shareholders
approved the proposal to acquire 50% equity of Chongqing Pingshan TK Carburetor
Co., Ltd.
On June 5, 2020, Chongqing Jianshe signed the "equity transfer contract" with
Yamaha Motor Co., Ltd., Aisan Industry Co., Ltd. and TK Carburetor Co., Ltd. to
purchase 20%, 25% and 5% equity of Chongqing Pingshan TK Carburetor Co., Ltd.
On the same day, the 51st board of directors of Chongqing Pingshan TK Carburetor
Co., Ltd. agreed that Yamaha Motor Co., Ltd., Aisan Industry Co., Ltd. and TK
Carburetor Co., Ltd. respectively transferred their shares to Chongqing Jianshe
Automobile System Co., Ltd. According to the conditions of the equity transfer
contract, the contract has come into effect on June 5, 2020 on the date of signing by
all parties and the date of approval of the board of directors of Chongqing Pingshan
TK Carburetor Co., Ltd.
On August 13, 2020, after being examined by Chongqing Banan district market
supervision and Administration Bureau, Pingshan TK was approved to register the
change of shareholders, legal representative, enterprise type, business term and
business scope, and issued the notice of approval of change of registration (Banan
municipal supervision) Registration No. 122452 [2020] No.), and renewed the
business license.
On September 8, 2020, Chongqing Jianshe paid the equity transfer price of 1 US
dollar to Yamaha Motor Co., Ltd., Aisan Industry Co., Ltd. and TK Carburetor Co.,
Ltd. respectively by international remittance. So far, the acquisition of 50% equity of
Pingshan TK has been completed.
The acquisition of 50% equity of Pingshan TK is regarded as a business combination
not under the same control, which involves the determination of the enterprise control
right, the judgment of the merger purchase date, the determination of the fair value on
the purchase day, the distribution of the merger cost among the identifiable assets and
liabilities, and the difference between the merger cost and the fair value of the
5
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
identifiable net assets of the acquiree. These involve management's estimation and
judgment. Chongqing Jianshe has hired a qualified asset appraisal agency to evaluate
the fair value of the identifiable assets and liabilities of the acquiree on the
acquisition base date, which involves many appraisal assumptions and estimates.
Moreover, the equity acquisition is important in this year, so we regard it as a key
audit matter.
（2）Countermeasures of Audit
Our main countermeasures of audit for the income of the above key audit are as
follows:
1）Obtained the board resolution, shareholders' meeting resolution, equity transfer
agreement, purchase price payment document, equity industrial and commercial
registration and other documents related to the transaction, and checked whether the
relevant legal procedures were completed and authorized
2）Reviewed the principles and basis of transaction pricing, obtained and checked the
financial statements of Pingshan TK on the acquisition date and the appraisal report
issued by the asset appraisal institution with December 31, 2019, and reviewed the
main assumptions, parameters, appraisal methods, calculation process, etc. in the
appraisal report, at the same time evaluated the appraisal experts from professional
competence, fairness, independence to objectivity. And judged that the transaction
pricing is fair.
3）We carried out audit procedures, such as inspection, inquiry, and so on, to examine
the actual performance of the transaction and to determine the reasonableness of the
management's determination of the date of disposal, and carry out the analysis
procedure, recalculate and other audit procedures to review the accuracy of
Chongqing Construction car to calculate the profit and loss on the sale of equity and
the related accounting treatment;
6
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
4）We obtained the financial statements and examined the presentation and disclosure
of the disposal transaction in the financial statements.
Ⅳ. Other information
The Company’s management of Chongqing Jianche (hereinafter referred to as
“management”) is responsible for the other information. The other information
comprises all of the information included in the Company’s 2020 Annual Report
other than the financial statements and our auditor’s report thereon. Our opinion on
the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read
the other information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If, based on the work we have
performed, we conclude that there is a material misstatement of this other information;
we are required to report that fact. We have nothing to report in this regard.
V. Responsibility of Management and Those Charged with Governance for the
Financial Statements
The management of the Company is responsible for the preparation and fair
presentation of these financial statements in accordance with Accounting Standards
for Business Enterprises to make them a fair presentation and designing,
implementing and maintaining internal control relevant to the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management of the Company is responsible
for assessing the Company’s ability to continue as a going concern, disclosing, if
applicable, matters related to going concern and using the going concern basis of
accounting unless the management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
7
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Those charged with governance are responsible for overseeing the Company’s
financial reporting process.
VI. CPA’s Responsibility for the Audit of the Financial Statements
Our objective is to obtain reasonable assurance as to whether the financial statements
as a whole are free of material misstatement resulting from fraud or error and to issue
an audit report containing an audit opinion. Reasonable assurance is a high level of
assurance, but there is no guarantee that audits performed in accordance with audit
standards can always be found when a material misstatement exists. Misstatements
may be the result of fraud or error, and misstatements are generally considered
material if they are reasonably expected to be misstated individually or collectively
that may affect the economic decisions made by the user of the financial statements
on the basis of the financial statements.
As part of an audit in accordance with auditing standards, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
（1）Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to
those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
（2）Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances.
（3）Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by the management.
（4）Conclude on the appropriateness of the management use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on the
Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the
related disclosures in the financial statements, or if such disclosures are inadequate, to
8
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
（ 5 ） Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements represent
the underlying transactions and events in a manner that achieves fair presentation.
（6）Obtain sufficient appropriate audit evidence regarding the financial information
of the entities or business activities within the Company to express an opinion on the
financial statements and bear all liability for the opinion.
We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have
complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and related safeguards.
From the matters communicated with those charged with governance, we determine
those matters that were of most significance in the audit of the financial statements of
the Current Period and are therefore the key audit matters. We describe these matters
in our auditor’s report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so
would reasonably be expected to outweigh the public interest benefits of such
communication.
Zhongxingcai Guanghua Certified Public Accountants CPA：
（Special General Partnership） （Engagement Partner）
CPA：
BeijingChina April 28，2021
9
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co., Ltd.
Consolidated Balance Sheet and The Company`s Balance Sheet
December 31, 2020 (Expressed in CNY unless otherwise stated)
Balance as at December 31,2020 Balance as at December 31,2019
Assets Note
Consolidation Parent Consolidation Parent
Current asset：
Cash and cash equivalents 4.1 159,343,241.47 1,039,038.26 154,613,734.94 4,448,232.99
Financial assets measured at fair
value through currentassets and loss
Derivative financial profits
Notes receivable 4.2 66,548,530.50 11,600,000.00 23,412,900.18 16,320,000.00
Accounts receivable 4.3 221,386,452.90 2,189,335.14 231,648,218.97 1,184,945.81
Accounts receivable financing
Advances to suppliers 4.4 8,539,316.15 5,477,412.18 10,076,917.93 5,428,338.82
Other receivables 4.5 1,253,612.91 934,239.22 3,439,028.39 2,376,451.69
Inventories 4.6 169,145,986.78 1,645,305.96 146,318,458.60 1,446,434.47
Available for sale assets
Non-current assets maturing within
one yearcurrent asset
Other 4.7 3,396,186.56 3,179.92 3,047,932.61 3,047,932.61
Total of current assets 629,613,327.27 22,888,510.68 572,557,191.62 34,252,336.39
Non-current assets：
Available for sale of financial assets
Held-to-maturity investments
Long-term receivables
Long-term equity investment 4.8 186,213,719.02 385,259,162.97 230,649,585.63 390,649,585.63
Other equity instrument investment
Other non-current financial assets 4.9
Property investment 4.10 23,043,398.52 23,043,398.52 71,928,994.28 71,928,994.28
Fixed assets 4.11 310,131,438.69 110,261,716.77 278,885,442.43 77,199,380.23
Construction in progress 4.12 1,871,241.59 66,037.74 3,858,269.05 166,386.41
Production physical assets
Oil & gas assets
Intangible assets 4.13 27,384,056.97 14,171,538.97 22,823,384.71 14,589,584.29
Development expenses
Goodwill
Long-term deferred expenses 4.14 24,750.00
Deferred income tax asset 4.15 6,274,078.12 6,060,931.98
Other non-current asset 4.16 2,141,443.59 3,383,556.88
Total of non-current assets 557,084,126.50 532,801,854.97 617,590,164.96 554,533,930.84
Total of assets 1,186,697,453.77 555,690,365.65 1,190,147,356.58 588,786,267.23
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal:Yanli Niu
10
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co., Ltd.
Consolidated Balance Sheet and The Company`s Balance Sheet (Continued)
December 31, 2020 (Expressed in CNY unless otherwise stated)
Balance as at December 31,2020 Balance as at December 31,2019
Assets Note
Consolidation Parent Consolidation Parent
Current liabilities
Short-term loans 4.17 553,910,000.00 422,280,000.00
Financial liabilities measured at fair value through current profit
and loss
Derivative financial liabilities
Notes payable 4.18 110,020,000.00 330,644,075.95 -
Accounts payable 4.19 288,803,247.07 265,278,880.90 225,193,165.80 191,919,884.09
Advances for customers 4.20 1,117,423.35 200,823.38
Contract liabilities 4.21 1,479,711.62 248,849.01
Payroll Payables 4.22 28,427,402.84 10,058,993.74 14,879,129.15 12,275,806.23
Taxes payable 4.23 18,106,616.93 15,199,300.72 17,773,372.17 15,169,059.96
Other account payable 4.24 10,260,888.23 231,990,706.48 6,087,459.55 293,722,742.58
Held for sales liabilities
Non-current liabilities maturing within one year
Other current liability 4.25 192,362.51 32,350.37
Total of current liability 1,011,200,229.20 522,809,081.22 1,017,974,625.97 513,288,316.24
Non-current liabilities：
Long-term loan
Bond payable
Including：preferred stock
perpetual bond
Long-term payable
Long-term Payroll Payable
Estimated liabilities
Deferred income
Deferred income tax liabilities 4.15 1,908,551.51
Other non-current liabilities
Total non-current liabilities 1,908,551.51 0.00 0.00 0.00
Total of liabilities 1,013,108,780.71 522,809,081.22 1,017,974,625.97 513,288,316.24
Owners’ equity
Share capital 4.26 119,375,000.00 119,375,000.00 119,375,000.00 119,375,000.00
Other equity instruments
Including：Preferred shares
Perpetual bond
Capital reserves 4.27 958,565,294.29 958,565,294.29 958,565,294.29 958,565,294.29
Less：treasury stock
Other comprehensive income 4.28 9,800.00 9,800.00 9,800.00 9,800.00
Special reserve
Surplus reserves 4.29 125,686,000.00 125,686,000.00 125,686,000.00 125,686,000.00
Retained Earrings 4.30 -1,030,047,421.23 -1,170,754,809.86 -1,031,463,363.68 -1,128,138,143.30
Total equity attributable to owners of the parent company 173,588,673.06 32,881,284.43 172,172,730.61 75,497,950.99
Minority equity
Total of owners’ equity 173,588,673.06 32,881,284.43 172,172,730.61 75,497,950.99
Total of liabilities and owners’ equity 1,186,697,453.77 555,690,365.65 1,190,147,356.58 588,786,267.23
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal:Yanli Niu
11
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co., Ltd.
Consolidated Income Statement and The Company`s Income Statement
(Expressed in CNY unless otherwise stated)
Year 2020 Year 2019
Item Note
Consolidation Parent Consolidation Parent
Ⅰ. Total operating income 4.31 740,851,845.25 582,119,961.20 791,487,434.18 601,057,530.18
Less: total operating costs 4.31 638,523,642.92 565,869,149.78 709,388,160.14 616,528,393.54
Taxes and surcharges 4.32 5,442,591.54 1,784,164.65 7,485,496.13 2,123,593.91
Selling expenses 4.33 16,631,963.90 2,379,049.19 24,647,316.08 1,839,252.86
General and administrative expenses 4.34 69,410,916.79 38,644,444.31 92,590,185.22 56,391,496.29
R&D expense 4.35 15,283,965.69 1,377,914.06 14,231,114.36 1,509,873.08
Financial expenses 4.36 22,486,373.84 545,319.21 21,295,046.18 9,126,407.12
Including: interest expense 23,719,626.23 632,663.12 23,726,455.73 9,400,282.65
Interest income 1,572,349.92 63,831.60 3,068,137.48 32,020.12
add: Other income 4.37 4,449,659.88 3,548,959.00 1,057,774.93
Investment income ("-" for losses) 4.38 -3,451,062.12 -5,390,443.20 -27,108,151.12 -27,108,151.12
Including: income from investment in associates and joint ventures -5,390,443.20 -5,390,443.20 -27,108,151.12 -27,108,151.12
Financial asset derecognition which measured in amortized cost method
Net exposure hedge income ("-" for losses)
Gain on changes in fair value （”-“ for loss)
Losses of credit impairment ("-" for losses) 4.39 -1,258,873.53 -1,478,870.07 -3,483,826.72 -20,066.52
Losses of assets impairment ("-" for losses) 4.40 -9,953,007.03 -9,140,781.65 -10,421,450.74 -5,639,143.73
Asset disposal income ("-" for losses) 4.41 -448,967.59 -158,358.75 -3,068,753.15 -3,068,753.15
Ⅱ. Operating profits ("-" for losses) -37,589,859.82 -41,099,574.67 -121,174,290.73 -122,297,601.14
Plus: Non-operating income 4.42 41,077,989.97 55,100.00 278,243.52 71,291.91
Minus: Non-operating expenses 4.43 1,572,672.69 1,572,191.89
Ⅲ. Total profits ("-" for total losses) 1,915,457.46 -42,616,666.56 -120,896,047.21 -122,226,309.23
Minus: income tax expenses 4.44 499,515.01 232,672.72
Ⅳ. Net profit ("-" for net loss) 1,415,942.45 -42,616,666.56 -121,128,719.93 -122,226,309.23
1.Classification according to net profit of going concern 1,415,942.45 -42,616,666.56 -121,128,719.93 -122,226,309.23
（1）Continuous operating net profit ("-" for losses) 1,415,942.45 -42,616,666.56 -121,128,719.93 -122,226,309.23
（2）net profit of Termination ("-" for losses)
2.Classification according to ownership 1,415,942.45 -121,128,719.93
（1）Net profit attributable to owners of the parent company 1,415,942.45 -121,128,719.93
12
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（2）Net of profit attributable to owners of Minority shareholders’ equity
Ⅴ. Net of tax of other comprehensive income
Net profit attributable to owners of the parent company
1. Other comprehensive income that cannot be reclassified into gains and losses subsequently
(1) Changes in net liabilities or net assets arising from re-measurement of defined benefit plan
(2) Share in other comprehensive income of the investee cannot be reclassified into gains and losses under
the equity method
2.Other comprehensive income to be reclassified into gains and losses subsequently
(1) Share in other comprehensive income of the investee to be reclassified into gains and losses under the
equity method
(2) Gains and losses on changes in fair value of financial assets available for sale
(3) Gains and losses arising from reclassification of held-to-maturity investments as financial assets
available for sale
(4) Effective portion of cash flow hedging gains and losses
(5) Translation differences of financial statements denominated in foreign currency
Net of tax of other comprehensive income attributable to non-controlling shareholders
Ⅵ. Total comprehensive incomes 1,415,942.45 -42,616,666.56 -121,128,719.93 -122,226,309.23
Total comprehensive income attributable to owners of the parent company 1,415,942.45 -121,128,719.93
Total comprehensive income attributable to owner’s minority shareholders -
Ⅶ. Earnings per share:
1.Basic earnings per share (RMB/Share) 0.0119 -1.0147
2.Diluted earnings per share (RMB/Share) 0.0119 -1.0147
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal:Yanli Niu
Chongqing Jianshe Vehicle System Co., Ltd.
Consolidated Statement Cash Flow and the Company`s Statement of Cash Flows
Year 2020 Year 2019
Items Note
Consolidation Parent Consolidation Parent
Ⅰ.Cash flows from operating activities:
Cash received from sale of goods and rendering of services 511,870,586.73 147,889,417.48 466,437,467.29 169,800,318.10
Refunds of taxes and surcharges 13,131,562.71 20,429,357.89
Cash received from other operating activities 4.46 16,546,105.54 14,729,508.79 37,028,279.25 11,023,912.63
Sub-total of cash inflows from operating activities 541,548,254.98 162,618,926.27 523,895,104.43 180,824,230.73
Cash paid for goods purchased and services received 242,967,204.21 118,365,485.57 301,159,831.44 74,078,877.04
13
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Cash paid to and on behalf of employees 97,076,119.98 41,809,052.51 119,831,406.99 52,117,985.68
Cash paid for taxes and surcharges 7,338,755.29 1,763,767.81 10,687,559.22 2,178,966.45
Cash paid for other operating activities 4.46 29,153,048.83 7,992,431.15 78,801,949.36 3,322,641.00
Sub-total of cash outflows from operating activities 376,535,128.31 169,930,737.04 510,480,747.01 131,698,470.17
Net cash flows from operating activities 165,013,126.67 -7,311,810.77 13,414,357.42 49,125,760.56
Ⅱ. Cash flows from investing activities:
Cash received from disposal of investments 30,193,650.00 30,193,650.00
Cash received from returns on investments 2,000,000.00 2,000,000.00
-
Net cash received from disposal of fixed assets, intangible assets and other
6,863.00- 167,737.79 167,737.79
long-term assets
Cash inflow from disposal of subsidiaries and other operating units
Cash received from other investing activities 4.46 61,450,668.55- -
Sub-total of cash inflows from investing activities 61,457,531.55 32,361,387.79 32,361,387.79
Cash paid to acquire and construct fixed assets, intangible assets and other
4,728,338.85 4,027,205.10- 4,391,453.90 4,385,493.36
long-term assets
Cash paid for investments 20.54 36,672,895.58 36,672,895.58
Net cash paid to acquire subsidiaries and other business units
-
Cash paid for other investing activities 4.46 40,000,000.00-
Sub-total of cash outflows from investing activities 44,728,338.85 4,027,225.64 41,064,349.48 41,058,388.94
Net cash flows from investing activities 16,729,192.70 -4,027,225.64 -8,702,961.69 -8,697,001.15
Ⅲ. Cash flows from financing activities
Cash received from investors
Including：Cash received by subsidiaries absorbing minority equity
investments
Cash received from borrowings 772,910,000.00 642,280,000.00
Cash received from other financing activities 4.46 306,429,590.72 449,469,841.68 690,502,411.58 906,680,000.00
Sub-total of cash inflows from financing activities 1,079,339,590.72 449,469,841.68 1,332,782,411.58 906,680,000.00
Cash paid for debt repayments 641,280,000.00 483,500,000.00
Cash paid for distribution of dividends and profits or payment of interest 22,798,392.28 23,745,836.21 10,915,545.98
Including: Dividends, profits paid by subsidiaries to minority shareholders
Cash paid for other financing activities 4.46 527,074,610.08- 441,540,000.00 893,408,643.27 998,122,003.63
Sub-total of cash outflows from financing activities 1,191,153,002.36 441,540,000.00 1,400,654,479.48 1,009,037,549.61
Net cash flows from financing activities -111,813,411.64 7,929,841.68 -67,872,067.90 -102,357,549.61
Ⅳ. Effect of fluctuation in exchange rate on cash and cash equivalents -8,980.28 -132.07 -94.35
Ⅴ. Net increase in cash and cash equivalents 4.47 69,919,927.45 -3,409,194.73 -63,160,804.24 -61,928,884.55
Plus: balance of cash and cash equivalents at the beginning of the period 4.47 9,390,326.10 4,448,232.99 72,551,130.34 66,377,117.54
Ⅵ. Balance of cash and cash equivalents at the end of the period 4.47 79,310,253.55 1,039,038.26 9,390,326.10 4,448,232.99
(Expressed in CNY unless otherwise stated)
14
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co.,Ltd.
Consolidated Statement of Changes in Owners' Equity
(Expressed in CNY unless otherwise stated)
Year 2020
Item Equity attributable to owners of the parent company
Total owners' equity
Other equity instruments Less: treasury Other Special Undistributed
Share capital Capital reserves Surplus reserves Others Sub-total Minority equity
Preferred Perpetual Others stock comprehensive reserves profits
Ⅰ. Balance as at December 31 of last year 119,375,000.00 shares bond 958,565,294.29 income
9,800.00 125,686,000.00 -1,031,463,363.68 172,172,730.61 172,172,730.61
Plus: adjustments for changes in accounting policies - -
Adjustments for correction of accounting errors in - -
prior year
Business combination involving entities under
- -
common control
Others - -
Ⅱ. Balance as at January 1 of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,031,463,363.68 - 172,172,730.61 172,172,730.61
Ⅲ. Increase/(decrease) for the current year ("-" for - - - - - - - - - 1,415,942.45 - 1,415,942.45 1,415,942.45
losses)
1.Total comprehensive incomes 1,415,942.45 1,415,942.45 1,415,942.45
2.Capital contributed or reduced by owners - - - - - - - - - - - - -
(1) Common shares from shareholders
(2) Investment capital from the holders of other
equity instruments
(3) Amount of the share-based payment included in
the Others equity
3.Distribution of profits - - - - - - - - - - - - -
(1) Withdrawal of surplus reserves
(2) Distribution to owners or shareholders
(3) Others
4.Transfers within the owners` equity - - - - - - - - - - - - -
(1) Conversion of capital reserves into paid-in capital
(2) Conversion of surplus reserves into paid-in capital
(3) Recovery of losses by surplus reserve
(4) Set benefit plan changes carry-over retained
income
(5) Other profits changes carry-over related income
(6) Others
5.Special reserves -
(1) Amount withdrawn in the current year
(2) Amount used in the current year
6.Others
Ⅳ. Ending balance of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,030,047,421.23 173,588,673.06 173,588,673.06
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal: Yanli Niu
15
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co.,Ltd.
Consolidated Statement of Changes in Owners' Equity
(Expressed in CNY unless otherwise stated)
Year 2019
Equity attributable to owners of the parent company
Item
Other equity instruments Less: Other Minority equity Total owners' equity
Special Undistributed
Share capital Preferred Capital reserves treasury comprehensive Surplus reserves Others Sub-total
Perpetual bond Others reserves profits
shares stock income
Ⅰ. Balance as at December 31 of last year 119,375,000.00 958,565,294.29 9,800.00 125,686,000.00 -910,334,643.75 293,301,450.54 293,301,450.54
Plus: adjustments for changes in accounting policies
Adjustments for correction of accounting errors in prior
year
Business combination involving entities under common
control
Others
Ⅱ. Balance as at January 1 of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -910,334,643.75 - 293,301,450.54 293,301,450.54
Ⅲ. Increase/(decrease) for the current year ("-" for losses) - - - - - - - - - -121,128,719.93 - -121,128,719.93 -121,128,719.93
1.Total comprehensive incomes -121,128,719.93 -121,128,719.93 -121,128,719.93
2.Capital contributed or reduced by owners - - - - - - - - - - - - -
(1) Common shares from shareholders
(2) Investment capital from the holders of other equity
instruments
(3) Amount of the share-based payment included in the
owners' equity
(4) Others
3.Distribution of profits - - - - - - - - - - - - -
(1) Withdrawal of surplus reserves
(2) Distribution to owners or shareholders
(3) Others
4.Transfers within the owners` equity - - - - - - - - - - - - -
(1) Conversion of capital reserves into paid-in capital
(2) Conversion of surplus reserves into paid-in capital
(3) Recovery of losses by surplus reserve
(4) Set benefit plan changes carry-over retained income
(5) Others
5.Special reserves
(1) Amount withdrawn in the current year -
(2) Amount used in the current year
6.Others
Ⅳ. Ending balance of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,031,463,363.68 - 172,172,730.61 172,172,730.61
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal: Yanli Niu
16
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co.,Ltd.
Consolidated Statement of Changes in Owners' Equity
(Expressed in CNY unless otherwise stated
Year 2020
Item Other equity instruments Less: Other
Special Undistributed
Share capital Preferred Perpetual Others Capital reserves treasury comprehensive Surplus reserves Others Total Owners`Equity
reserves profits
shares bond stock income
Ⅰ. Balance as at December 31 of last year 119,375,000.00 958,565,294.29 9,800.00 125,686,000.00 -1,128,138,143.30 75,497,950.99
Plus: adjustments for changes in accounting policies -
Adjustments for correction of accounting errors in prior year -
Others -
Ⅱ. Balance as at January 1 of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,128,138,143.30 - 75,497,950.99
Ⅲ.Increase/(decrease) for the current year ("-" for losses) - - - - - - - - - -42,616,666.56 - -42,616,666.56
1.Total comprehensive incomes -42,616,666.56 -42,616,666.56
2.Capital contributed or reduced by owners - - - - - - - - - - -
(1) Common shares from shareholders -
(2) Investment capital from the holders of other equity instruments -
(3) Amount of the share-based payment included in the owners' equity -
(4) Others - -
3.Distribution of profits - - - - - - - - - -
(1) Withdrawal of surplus reserves
(2) Distribution to owners or shareholders
(3) Others - -
4.Transfers within the owners` equity - - - - - - - - - -
(1) Conversion of capital reserves into paid-in capital
(2) Conversion of surplus reserves into paid-in capital
(3) Recovery of losses by surplus reserve
(4) Set benefit plan changes carry-over retained income
(5) Other profits changes carry-over related income
(6) Others
5.Special reserves -
(1) Amount withdrawn in the current year
(2) Amount used in the current year
6.Others -1,170,754,809.86 32,881,284.43
Ⅳ. Ending balance of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,170,754,809.86 - 32,881,284.43
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal: Yanli Niu
17
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Jianshe Vehicle System Co.,Ltd.
Statement of Changes in Owners' Equity
(Expressed in CNY unless otherwise stated
Year 2019
Item Other equity instruments Less: treasury Other Undistributed
Share capital Preferred Perpetual Others Capital reserves comprehensive Special reserves Surplus reserves Others Total Owners` Equity
stock profits
shares bond income
Ⅰ. Balance as at December 31 of last year 119,375,000.00 958,565,294.29 9,800.00 125,686,000.00 -1,005,911,834.07 197,724,260.22
Plus: adjustments for changes in accounting policies
Adjustments for correction of accounting errors in prior
year
Others
Ⅱ. Balance as at January 1 of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,005,911,834.07 197,724,260.22
Ⅲ.Increase/(decrease) for the current year ("-" for - - - - - - - - - -122,226,309.23 - -122,226,309.23
losses)
1.Total comprehensive incomes -122,226,309.23 - -122,226,309.23
2.Capital contributed or reduced by owners - - - - - - - - - - -
(1) Common shares from shareholders -
(2) Investment capital from the holders of other equity -
instruments
(3) Amount of the share-based payment included in the -
owners' equity
(4) Others - -
3.Distribution of profits - - - - - - - - - -
(1) Withdrawal of surplus reserves
(2) Distribution to owners or shareholders
(3) Others - -
4.Transfers within the owners` equity - - - - - - - - - -
(1) Conversion of capital reserves into paid-in capital
(2) Conversion of surplus reserves into paid-in capital
(3) Recovery of losses by surplus reserve
(4) Set benefit plan changes carry-over retained income
(5) Other profits changes carry-over related income
(6) Others
5.Special reserves
(1) Amount withdrawn in the current year -
(2) Amount used in the current year
6.Others
Ⅳ. Ending balance of the current year 119,375,000.00 - - - 958,565,294.29 - 9,800.00 - 125,686,000.00 -1,128,138,143.30 - 75,497,950.99
Legal Representative of Enterprise: Xuechuan Yan Accounting Principal: Mingxian Tan Accounting Firm's Principal: Yanli Niu
18
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Notes To Financial Statements
Ⅰ.Corporate Information
Chongqing Jianshe Vehicle System Co.,Ltd. (hereinafter referred to as the "Company",
"Company" or "Chongqing Jianshe")，the company’s original name is Chongqing Jianshe
Motorcycle Co.,Ltd.，was jointly set up in July 1995 by the Construction Industry (Group) Co.,
Ltd. and China North Industries Shenzhen Corporation. The Business License of the
Enterprise: No. 915000007474824231. The Company was listed in July 1995 at the Shenzhen
Stock Exchange. The Company is engaged in the manufacturing industry.
On December 27, 2017, the company issued an announcement that it has completed the
relevant business registration procedures for the change in Chinese, obtained the notice of
approval for change of registration of Chongqing administration of industry and commerce
(Chongqing Industrial and commercial registration of changes [2017] No.1206-1)，got an
issue of a business license and approval rear of implementing the Shenzhen stock exchange.
The name of the company was changed from " Chongqing Jianshe Motorcycle Co., Ltd." to "
Chongqing Jianshe Vehicle System Co.,Ltd.". Abbreviation of the company was changed
from "Jianmo B" to "Jianshe B", and the securities code of the company was unchanged at
200054.
On October 22, 2018, Chongqing Jianshe mechanical and electrical co., LTD., the controlling
shareholder of the company, signed the "Equity transfer Agreement for State-owned listed
companies" with China South Industries Group Corporation (hereinafter referred to as
"GSGC"). The Chongqing Jianshe mechanical and electrical co., LTD. transferred 84,906,250
shares of its state-owned legal person shares to the GSGC, it accounts for 71.13% of the
Chongqing Jianshe 's total share capital.
On December 21, 2018, the company received the " Confirmation of registration of securities
transfer " issued by the Shenzhen Branch of China Securities Registration and Clearing Co.,
Ltd., and the registration procedures for the transfer of shares under this agreement have been
completed in the Shenzhen branch of China Securities Registration and settlement Co., Ltd.
After the completion of this agreement transfer, Chongqing Jianshe mechanical and electrical
co., LTD., would no longer hold shares of the company. GSGC became the controlling
shareholder of the company, the proportion of shareholding is 71.13%, and the nature of the
19
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
shares is State-owned legal person shares.
The parent company and actual controller of the company is China South Industries Group
Corporation. The ultimate controller of the Company is the State-owned Assets Supervision
and Administration Commission (SASAC).
As at December 31, 2020, the Company issued 119,375,000 shares in total and had the
registered capital of 119,375,000. The registration place: NO.1, JIANSHE ROAD HUAXI
INDUSTRY PARK, BANAN DISTRICT, CHONGQING; the headquarters address: Banan
District, Chongqing Municipality. Legal representative: Xuechuan Yan. The main business
activities: research and development, processing, manufacturing and related technical services
of Motorcycles, auto parts, accessories, machinery products, design, manufacturing and
related technical services of tooling (except for those subject to national special provisions); R
& D, production and sales of motorcycle engines; research, development and processing of
mechanical and electrical products, home appliances, bicycles, environmental protection
product; imports, wholesale, retail, commission agency (except auction) of similar products of
these products.
The disclosure of the financial report was approved by the Board of Directors on April 28,
2021.
As at December 31, 2020, two subsidiaries were included in the scope of consolidated
financial statements of the Company，See "Note VI Equity in other entities" for details of
scope consolidated financial statements. The scope consolidated financial statements of this
year has increased 1 subsidiary compared with the last year, see "Note V Changes in the
scope of business combinations " for details.
The company and Chongqing Jianshe Automobile A/C Co., Ltd., its important subsidiary,
mainly engaged in the manufacture, sale of air conditioners and accessories, air conditioning
and spare parts maintenance.
Ⅱ.Basis for the Preparation of financial statements
1.Basis for Preparation
The Company prepares the financial statements on the basis of going concern, according to
actual transactions and events, and in accordance with the Accounting Standards for Business
Enterprises – Basic Standards and 38 concrete accounting standards issued by the Ministry of
Finance on February 15, 2006, the subsequently issued Accounting Standards for Business
Enterprises – Application Guidelines, and the Accounting Standards for Business Enterprises
20
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
– Interpretations and other relevant provisions (hereinafter collectively referred to as –
Accounting Standards for Business Enterprises‖), as well as Compilation Rules for
Information Disclosure by Companies Offering Securities to the Public No. 15 - General
Provisions on Financial Reports issued by China Securities Regulatory Commission.
In accordance with relevant provisions of the Accounting Standards for Business Enterprises,
the Group adopted the accrual basis in accounting. Except for some financial instruments,
where impairment occurred on an asset, an impairment reserve was withdrawn accordingly
pursuant to relevant requirements.
2. Going Concern
The Company was on a going concern basis in 12 months as of the end of the current
reporting period and was not affected by any material event having impact on the going
concern.
3. Principal accounting policies and accounting estimates
(1) Statements on Compliance with Accounting Standards for Business Enterprises
The financial statements prepared by the Company meet the requirements of the Accounting
Standards for Business Enterprises and truly and completely reflect the Company’s financial
position, operating results and cash flows, etc. for the reporting period.
(2) Accounting period
The Company’s fiscal periods include fiscal years and fiscal periods shorter than a complete
fiscal year from January 1 to December 31 as one accounting year.
(3) Operating cycle
The normal operating cycle refers to the period from the assets used for processing after
purchased by the company to the cash or cash equivalents achieved. 12 months are regarded
as one operating cycle in the company, and which is as the division criterion for the liquidity
of assets and liabilities.
4. Functional currency
The functional currency is CNY.
21
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
5. Accounting treatments of the combination of enterprises under common control and
the combination of enterprises not under the common control
Business combination refers to the transactions or items with one reporting entity formed by
the combination of two or more separate enterprises. The business combination shall be
divided into the business combination under common control and the business combination
under non-common control.
（1）Business combination under common control
The business combination under common control refers to the business combination in which
all of the combining enterprises are ultimately controlled by the same party or parties both
before and after the combination, and that control is not transitory. Of which, the combining
party is that acquiring the control right to other combining enterprises at combining date, and
the combining date means the date that the combining party actually acquires the control right
of the combined party. The acquisition date means the date that the acquirer actually obtains
the control right of the acquiree.
The assets and liabilities acquired by the combining party are measured in accordance with
the book value of the combined party at the combining date. For the balance between the
book value of net assets acquired by the combining party and the book value of the combining
valuable consideration (or the nominal amount of issued shares), the capital reserves (stock
premium) shall be adjusted, or the retained earnings shall be adjusted when the capital
reserves (stock premium) are insufficient.
All the costs directly incurred for the business combination by the combining party shall be
recorded into the current profits and losses when occurred.
（2）Combination of enterprises not under the common control
The business combination under non-common control refers to the business combination in
which all of the combining enterprises are not ultimately controlled by the same party or
parties both before and after the combination. Of which, the acquirer is that obtaining the
control right to other combining enterprises at acquisition date, and other combining
enterprises refers to the acquiree. The acquisition date means the date that the acquirer
actually obtains the control right of the acquiree.
For the business combination under non-common control, the merger costs include the assets
paid for obtaining the control right of acquiree by the acquirer, the liabilities occurred or
22
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
borne and the fair value of equity securities issued, the intermediary fees for audit, legal
services, evaluation and consultation when the business combination issued, and other
management costs shall be recorded into the current profits and losses when occurred. The
transaction costs of equity securities or debt securities issued for the merger consideration by
the acquirer shall be included into the initially recognized amount of the equity securities or
the debt securities. The contingent consideration involved shall be recorded into the merger
cost as per the fair value at the acquisition date. Within 12 months after the acquisition date,
the combining goodwill should be adjusted correspondingly if the contingent consideration is
required to adjust because of new or further evidence for the existed situation on the
acquisition date. The merger cost issued by the acquirer and the identifiable net assets
acquired in the combination are measured as per the fair value on the acquisition date. The
difference of the merger cost less the fair value shares of identifiable net assets obtained by
the acquiree during the merger on the acquisition date, is recognized as the goodwill. While
the merger cost is less than the fair value shares of identifiable net assets obtained by the
acquiree during the merger, all the measurement on the identifiable assets, the liabilities, the
fair value of liabilities and the merger cost obtained by the acquiree should firstly be
rechecked, and the difference shall be recorded into the current profits and costs if the merger
cost is still less than the fair value shares of identifiable net assets obtained by the acquiree
during the merger after rechecking.
If the deductible temporary difference of acquiree obtained by the acquirer is not recognized
due to the recognition condition of the deferred income tax assets unmet on the acquisition
date within 12 months after the acquisition date, the relevant deferred income tax assets shall
be recognized and the goodwill shall be reduced if the acquired new or further evidence
shows that the relevant situation has already existed and the economic benefit gained by the
acquiree from the deductible temporary difference is expected to achieve, and the differences
are recognized as the current profits and losses if the goodwill is insufficient to offset. With
the exception of the above, the deferred income tax assets related to the business combination
are recorded into the current profits and losses.
For the business combination under non-common control realized step-by-step through
multiple transactions, the multiple transactions shall be judged if belong to “the package deal”
according to the “Notice on Issuance of Interpretation of Accounting Standards for Business
Enterprises from Ministry of Finance” (Finance and Accounting [2012] No.19) and the
judgment standards on “the package deal” in Article 51st of “Accounting Standards for
23
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Business Enterprises No.33 – Consolidated Financial Statement” (please see Note 3.6 (2)).
For the package deal, please refer to above description of this section and Note 3.14
“Long-term Equity Investment” to conduction the accounting treatment. For the non-package
deal, the relevant accounting treatment should be respectively conducted for the individual
financial statement and the consolidated financial statements:
For the individual financial statements, the sum of the book value of equity investment from
the purchased party held before the purchase date and the new investment cost at the purchase
date shall be as the initial investment cost of the investment. For the other comprehensive
incomes involved in the equity of the acquiree held before the acquisition date, the investment
and the relevant other comprehensive incomes shall be disposed through the accounting
treatment on the same basis of the direct disposal of the relevant assets or liabilities by the
acquiree (Namely, the rest is transferred into the current investment incomes with the
exception of the corresponding shares of changes caused by the net liabilities or the net assets
of the defined benefit plans re-measured by the acquiree as per the equity method).
In the consolidated financial statements, the equity of the acquiree held before the acquisition
date shall be measured again as per the fair value of the equity on the acquisition date, and the
difference between the fair value and the book value is recorded into the current investment
income. For the other comprehensive incomes involved in the equity of the acquire held
before the acquisition date, the relevant other comprehensive incomes shall be disposed
through the accounting treatment on the same basis of the direct disposal of the relevant assets
or liabilities by the acquire (Namely, the rest is transferred into the current investment
incomes on the acquisition date, with the exception of the corresponding shares of changes
caused by the net liabilities or the net assets of the defined benefit plans re-measured by the
acquire as per the equity method).
6. Preparation of consolidated financial statements
（1）Principle for determining the consolidation scope
The consolidation scope for financial statements is determined on the basis of control. The
term “control” is the power of the Group upon an investee, with which it can take part in
relevant activities of the investee to obtain variable returns and is able to influence the amount
of returns. The scope of consolidation includes the Company and its all subsidiaries. A
subsidiary is an enterprise or entity controlled by the Group.
Once any changes in the relevant facts or situations resulted in any changes in the elements
24
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
involved in the aforesaid definition of “control”, the Company shall carry out a reassessment.
（2）The method of preparing consolidated financial statements
The company starts to include the actual control right to the net assets and the production and
management decisions of the subsidiaries into the combination scope since the date of the
actual right acquired, and will stop covering into the combination scope on the date of the
actual right lost. For the disposed subsidiaries, the business performance and the cash flow
before the disposal date have been properly covered in the consolidated profit statement and
the consolidated cash flow statement. For the subsidiaries disposed in the current period, the
opening balance of the consolidated balance sheet shall not be adjusted. Through the business
combination under non-common control, the business performance and the cash flow after the
acquisition date have been properly included in the consolidated profit statement and the
consolidated cash flow statement, and the opening balance and the comparison balance of the
consolidated financial statement shall not be adjusted. For the subsidiaries increased through
the business combination under common control, the business performance and the cash flow
from the beginning of current combination period to the combination date have been properly
included in the consolidated profit statement and the consolidated cash flow statement, and
the comparison balance of the consolidated financial statement shall be adjusted
simultaneously.
With the preparation of the consolidated financial statement, the necessary adjustment shall be
made according to the accounting policy of the company and the financial statement of the
subsidiaries during the fiscal period if the accounting policy or the fiscal period adopted by
the subsidiaries and the company is discrepant. For the subsidiaries acquired through the
business combination under non-common control, the financial statement shall be adjusted on
the basis of the fair value of the identifiable net assets on the acquisition date.
All the major balances, transactions and the unrealized profits of the company shall be offset
in the preparation of the consolidated financial statement.
Those not belong to the company in the shareholders’ equity and the current net profit or loss
of the subsidiaries shall be respectively as the minority equity and the minority interest
income and individually listed under the shareholders’ equity and the net profit of the
consolidated financial statement. The minority equity portion from the net profit or loss in
current period shall be as “minority interest income” and listed under the net profit in the
consolidated financial statement. Moreover, the minority equity is still offset even if the losses
of the subsidiaries undertaken by the minority shareholders are beyond the portion of the
25
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
shareholders’ equity shared by the minority shareholders of the company at the beginning of
period.
When the control on the original subsidiaries is lost due to the disposal of partial equity
investment or other reasons, the remaining equity should be measured again according to the
fair value on the control lost date. The difference of the consideration acquired by the disposal
of equity and the fair value of the remained equity less the net assets portion of the original
subsidiaries calculated from the purchase date as per the original stock proportion shall be
recorded into the current investment income after the control lost. Other comprehensive
returns relevant to the original subsidiary shares investment shall be disposed through the
accounting treatment on the same basis of the direct disposal of the relevant assets or
liabilities by the acquiree when the control lost (Namely, all the rest are transferred into the
current investment incomes, with the exception of the changes caused by the net liabilities or
the net assets of the defined benefit plans re-measured by the original subsidiaries). Thereafter,
the subsequent measurement shall be made for the rest equity according to the relevant
provisions of “Accounting Standards for Business Enterprises No. 13 – Long-term Equity
Investment” or “Accounting Standards for Business Enterprises No. 10 – Recognition and
Measurement of Financial Instruments”. For the details, please see Notes 2.13 “Long-term
Equity Investment” or Notes 2.10 “Financial Instruments”.
For the equity investment in the subsidiary through the step-by-step disposal of multiple
transactions till the control right lost, the company should respectively dispose all the
transactions if belong to the package deal. As long as the terms, conditions and economic
influence on all the transactions of the disposal of the equity investment in the subsidiary
meet one status below, it usually shows that the multiple transactions matters should be
conducted the accounting treatment as the package deal: ① these transactions are made
simultaneously or under the consideration of the influence each other. ② these transactions
shall be as the whole to achieve one complete business results. ③ one transaction occurs
depending on the appearance of other one transaction at least. ④ one transaction is
economic under the consideration with other transactions even if it is not economic when
individually considerate. For the non-package deal, each transaction shall be respectively
conducted the accounting treatment according to the applicable principles of “Partial Disposal
of Long-term Equity Investment in Subsidiary without Control Lost” (please refer to (2) ④
in Note 2.13) and “The Control on Original Subsidiary Lost due to Disposal of Part of Equity
26
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Investment or Other Reasons” (details please see forepart). For the package deal from the
transactions after the disposal of equity investment in the subsidiary till the control right lost,
the transactions shall be as one transaction of the disposal of subsidiary and the control lost
for the accounting treatment. Therefore, every balance between the net assets proportion of
the subsidiary shared relative to the disposal price and the disposal investment before the
control right lost, shall be recognized as other comprehensive incomes in the consolidated
financial treatment and transferred into the current profits and losses when the control lost.
7.Joint venture arrangements classification and accounting treatment of joint operation
Joint venture arrangement refers to an arrangement jointly controlled by two or more parties.
According to the rights and obligations in the joint venture arrangement, the company divides
the joint venture arrangement into joint operation and joint venture. Joint operation means the
company has the right to arrange related assets and related liabilities. Joint venture means the
company only has the right to arrange the net asset.
The company adopts equity method to calculate investment to joint venture by referring to
accounting policies stated in "Long-term Stock Ownership for Equity Method Calculation"
(please refer to (2) ④ in Note 2.13)
As one party of joint operation, the company confirms assets and liabilities only held by itself
and confirms joint assets and liabilities as proportion of the company’s shares; confirm
incomes from sales and production in the way of joint operation as proportion of the
company’s shares; confirm the company’s own expenses and all expenses in the way of joint
operation as proportion.
As a party of joint operation, the company funds or sells assets (not used for operation, the
same below) of joint operation or purchases assets from joint operation. Before the assets are
sold to a third party, the company only confirms the losses and profits in the trade which
belong to other parties in the joint operation. In case the assets are in conformity to the asset
impairment loss regulated in Asset Impairment --No.8 of Accounting Criteria for Enterprises,
the company confirms all losses in full amount for the company funding or selling assets of
joint operation. The company confirms the loss as proportion of shares for the company
purchasing assets from joint operation.
8. Recognition criteria of cash and cash equivalents
The cash stated in cash flow statement refers to cash in hand and bank deposits usable for
27
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
payment at any time. Cash equivalent refers to the investments with holding period of less
than three months that are readily convertible to known amount of cash and subject to
insignificant risk of changes in value.
9. Foreign currency business and foreign currency translation
（1）Translation Method of Foreign Currency Transaction
The shot exchange rate (usually refers to the middle rate at the date of currency exchange
published by the People’s Bank of China, hereinafter inclusive) on the transaction date is
adopted to convert to the amount of functional currency when the foreign currency transaction
issued in the company is initially recognized. However, the foreign currency exchanges or the
transactions relative to the foreign currency exchanges occurred in the company shall be
translated into the amount of functional currency as per the actually adopted exchange rate.
（2）Translation Method for Monetary Items of Foreign Currency and Non-monetary Items of
Foreign Currency
On the balance sheet date, the spot exchange rate on the balance sheet date is used for the
monetary items in foreign currency. The exchange difference arising from the special
borrowing in foreign currency borrowed for the purpose of purchasing and constructing assets
meeting the capitalization conditions of borrowing costs shall be capitalized during the
capitalization period.
When it involves overseas business in preparing the consolidated financial statement, for the
translation difference of foreign currency monetary items of net investment in overseas
business arising from the change in exchange rate, it shall be recorded into the other
comprehensive income; and be recorded into disposal gains and losses at current period when
disposing overseas business.
The non-monetary items of foreign currency measured at the historical cost shall still be
measured by the amount of functional currency translated at the spot exchange rate on the
transaction date. The non-monetary items of foreign currency measured at the fair value shall
be translated at the spot exchange rate on the fair value recognized date, and the gap of the
translated amount of functional currency and the original the amount of functional currency
shall be as the fair value variation (change in exchange rate included) to make treatment and
recorded into the current profits and losses or recognized as other comprehensive incomes.
28
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（3）Translation Method of Foreign Currency Financial Statement
For the overseas business operation involved in the preparation of the consolidated financial
statement, the exchange balance arising from the change in exchange rate for the foreign
currency monetary items of the net investment in the overseas business, shall be as
“translation reserve of foreign currency statement” and recognized as other comprehensive
incomes. The profits and losses of the current disposal period shall be recorded when disposal
of the overseas business operations.
The foreign currency financial statement of the overseas business operation shall be translated
as RMB statement as per the following methods: the assets and liabilities in the balance sheet
shall be translated at a spot exchange rate on the balance sheet date. For the shareholders’
equity items, other items shall be translated at a spot exchange rate when occurring, except for
the “undistributed profit” items. The earnings and expenses items in the profit statement shall
be translated at a spot exchange rate on the transaction date. Moreover, the Retained Earnings
at the beginning of this year are the profits translated at the end of last year which shall be
distributed and listed all the items measurement as per the translated profits. The difference
between the translated assets items and the sum of the liability’s items and the shareholders’
equity items shall be as the translation reserve of foreign currency statement and recognized
as other comprehensive incomes. When disposing the overseas business operation and losing
the control right, the translation reserves of foreign currency statement related to the overseas
business operation which listed in the shareholders’ equity items in the balance sheet, are all
recorded into the current disposal profits and losses or shifted as per the disposal proportion
of the overseas business operation.
The cash flows of foreign currency and overseas subsidiary shall be translated at the spot
exchange rate on the cash flow date. The influence amount of the change in exchange rate on
the cash shall be individually listed and reported as the adjustment items in the cash flow
statement.
The amount at the beginning of this year and the actual amount of last year shall be listed
according to the translated amount of the financial statement.
If the control on the overseas business operation lost due to the disposal of partial equity
investment or other reasons when disposing all the owners’ equity of the overseas business
operation of the company, the translation reserves of foreign currency statement belong to the
owners’ equity of the parent company related to the overseas business operation which listed
in the shareholders’ equity items in the balance sheet, are all recorded into the current disposal
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
profits and losses.
If the held equity proportion of the overseas business operation reduced due to the disposal of
partial equity investment or other reasons, but the control on the overseas business operation
not lost, the translation reserves of foreign currency statement related to the partial disposal of
the overseas business operation shall belong to the minority equity and not recorded into the
current profits and losses. When disposing partial equity of the joint ventures or the
cooperative enterprises of the overseas business operations, the translation reserves of foreign
currency statement related to the overseas business operations shall be recorded into the
current disposal profits and losses as per the disposal proportion of the overseas business
operations.
10. Financial instruments
A financial instrument refers to a contract that concludes the financial assets of one party and
the financial liabilities or equity instruments of another party. Related financial assets or
financial liabilities are recognized when the company becomes a party to a financial
instrument contract.
Financial assets and financial liabilities are measured at fair values at the initial recognition:
(i) for the financial assets and financial liabilities measured at fair values with variations
recorded into the current profits and losses, related transaction expenses are directly recorded
into the current profits and losses;(ii) for other kinds of financial assets and financial
liabilities, related transaction expenses are included in the initial recognition amounts.
Furthermore, subsequent measurements of financial assets and liabilities are decided by their
own classifications.
A financial asset or financial liability that qualified with one of the following conditions are
indicating its transactional purposes: (i) the purpose of acquiring relevant financial assets or
assuming relevant financial liabilities is mainly made for the purpose of selling or
repurchasing in the near future; (ii) the initial confirmation is a part of the identifiable
portfolio of financial instruments under centralized management, and there is objective
evidence that the short-term profit model actually exists in the near future;(iii) where it is
defined as the derivative instrument, but conforms to the financial guarantee contract
definition and is designated as an effective hedging instrument of the derivative instruments.
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（1）Debt Instruments
Debt instruments refer to the instruments that conform to the definition of financial liabilities
from the perspective of the issuers. The classifications and subsequent measurements of debt
instruments depend on the company's business models for financial assets management and
the contractual cash flow characteristics of financial assets. Where it fails to pass the cash
flow characteristic test, direct classification as a financial asset measured at fair values shall
be adopted with variations to be recorded into the current profits and losses; where it succeed
to pass the cash flow characteristic test, its classification shall be determined on the business
model of financial assets management, and its qualification as a financial asset measured at
fair values, of which variations shall be recorded into the current profit and loss.
1) To be measured at amortized costs.
The company's business models for the management of such financial assets are aimed at the
collection of the contract cash flows, of which the characteristics of the contract cash flow
shall be consistent with the benchmark lending arrangement, that is, the cash flows generated
at a certain date are referred to the payment of the principal and the interest based on the
outstanding principal amount only while the financial assets are not designated to be
measured at fair values, but their variations are recorded into the current profits and losses.
However, the company recognizes interest incomes for such financial assets in accordance
with the effective interest rate methods. The profits or losses of such financial assets due to
the termination of recognition together with the losses as a result of the impairment are
directly recorded into the current profits and losses.
2) To be measured at fair values with its variations included in other comprehensive
incomes.
The company's business model for managing such financial assets is both to receive the
contract cash flows and to sell, of which the characteristics of the contract cash flows shall be
consistent with the benchmark lending arrangements, that is, the cash flow generated at a
certain date is only the payment of the principal and the interest based on the outstanding
principal amount while the financial assets are not designated to be measured at fair values,
but their variations are recorded into the current profits and losses. However, such financial
assets are measured at fair values and their variations are included in other comprehensive
incomes, but impairment losses or gains, exchange gains & losses and interest incomes
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
calculated according to the actual interest rate method are included in the current profits and
losses. Furthermore, variations in fair values accumulated into other comprehensive incomes
will be carried forward to the current profits and losses when the recognition of such
financial assets is terminated. Such financial assets are listed as other lending investments.
3) To be measured at fair values with variations booked into the current profits and losses.
Debt instruments held by the company that are not divided into those measured at amortized
costs and those measured at fair values with their variations recorded in other comprehensive
incomes are measured at fair values and their variations are recorded into the current profits
and losses, of which those classified as financial assets are measured at fair values with
variations recorded into current profits and losses are listed as transactional financial assets or
other non-current financial assets.
（2）Equity Instruments
An equity instrument is one that is analyzed from the perspective of the issuers in accordance
with the definition of an equity instrument. Equity instrument investments is measured at fair
values with variations recorded into current profits and losses, which are listed as
transactional financial assets, except that the management of the company that is specified to
be measured at fair values with variations recorded into other comprehensive incomes.
Items designated to be measured at fair values with variations included in the comprehensive
incomes are listed as the investments of other equity instruments, of which related changes in
fair values shall not be carried forward to the current profits and losses, and such designation
shall not be revoked once made. However, related dividend gains are booked into the current
profits and losses, and no impairment provision is included in the other equity instruments.
When terminate recognition, the accumulated gains or losses as previously recorded in other
comprehensive incomes are transferred from other comprehensive incomes and recorded in
retained earnings.
（3）Financial Liabilities
Financial liabilities are classified as financial liabilities and other financial liabilities which
are measured at fair values with variations to be recorded into the current profits and losses at
the initial recognition.
Financial liabilities measured at fair values with variations recorded into the current profits
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
and losses includes trading financial liabilities and financial liabilities that are specified to be
measured at fair values with variations booked into the current profit and loss. Financial
liabilities can be designated as financial liabilities to be measured at fair values at the initial
measurement with their variations recorded into the current profits and losses upon the any of
the following conditions:
1）the designation can eliminate or significantly reduce the accounting mismatches;
2）The portfolio of financial liabilities or the portfolio of financial assets and financial
liabilities is managed and evaluated on the basis of fair values, and reported to key
management within the company thereafter according to the risk management or investment
strategies stated in the official written documents. Such designation shall not be revoked once
made.
For financial liabilities designated to be measured at fair values with variations recorded in
the current profits and losses, variations in fair values caused by changes in the company's
own credit risks shall be recorded in other comprehensive incomes, while variations of other
fair values are booked into the current profits and losses. Furthermore, when terminate the
recognition of such financial liabilities, the accumulated gains or losses as previously
recorded in other comprehensive incomes are transferred from other comprehensive incomes
and recorded in retained earnings.
Other financial liabilities of the company mainly include short-term loans, long-term loans
and the like. For such financial liabilities, effective interest methods are adopted with
subsequent measurement to be made according to the amortized costs.
（4）Termination Recognition of Financial Assets and Financial Liabilities
A financial asset shall be terminated upon one of the following circumstances:
1) The contractual right to receive the cash flow of the financial assets is terminated;
2) The financial asset with almost all the risks and rewards from the ownership of the
financial assets have been transferred to the transferee;
3) Although the company has neither transferred nor retained nearly all the risks and
rewards
in the ownership of the financial asset, the financial assets of the company have been
transferred and have relinquished control of the financial assets.
33
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Where the current obligations of a financial liability (or any part thereof) have been
discharged, the company ceases to recognize such financial liability (or any part thereof).
（5）Impairment of Financial Instruments
The company carries out impairment accounting treatment to the financial instruments based
on expected credit losses and confirms loss provisions. Expected credit loss refers to the
weighted average credit losses of financial instruments by the risks of defaults, and credit
losses refer to the difference between all contract cash flow receivable under the contract as
well as all cash flows expected to be collected that discounted at the original real interest
rates, that is, the present values of all cash shortfalls.
Measuring methods of the company's expected credit losses on financial instruments reflects
the following factors: unbiased probability weighted averages as determined by a range of
possible outcomes; the time value of money; reasonable and informed information about past
events, current conditions and future economic conditions available up to the balance sheet
date without unnecessary additional costs or efforts. The company determines the expected
credit losses of relevant financial instruments in the following manners:
1) For financial assets, the credit losses are the present values of the difference between the
contract cash flows and the expected cash flows payable by the company;
2) For leasing receivables, the credit losses are the present values of the difference between
the contract cash flows and the expected cash flows payable by the company;
3) For any uncommitted loan commitment, the credit losses are the present values of the
difference between the contract cash flows payable by the company and the cash flows
expected to be collected if the loan commitment holder withdraws corresponding loans. The
company's estimations on the expected credit losses of the loan commitment are consistent
with its expectations on the utilization of the loan commitments;
4) In the case of a financial guarantee contract, the credit losses are the present values of the
difference between the amount the company expects to receive from the contract holders,
debtors or any other party, and the amount of money the company expects to pay to the
contract holder in respect of the credit losses incurred by the contract holder;
5) In the case of a financial asset whose credit impairment has occurred on the date as
indicated by the balance sheets but is not purchased or originated, the credit losses are
referred to the difference between the book balance of the financial assets and the present
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
values of the estimated future cash flow discounted at the original real interest rates.
Three stages are adopted to identify expected credit losses by assessing whether its credit
risks have increased significantly since its initial recognition together with considerations to
the reasonable and evidence-based information (including forward-looking information) on
each balance sheet date. In the case that the credit risk has not increased significantly since
the initial confirmation, the expected credit losses are defined as the first stage, and the loss
provisions are measured according to the expected credit losses of the financial instruments
within the next 12 months; If the credit risk has not increased significantly since the initial
recognition, it shall be in the first stage, and the loss provision shall be measured according to
the expected credit loss of the financial instrument in the next 12 months; If the credit risk
has increased significantly since the initial recognition, but the credit impairment has not
occurred, it shall be in the second stage, and the loss provision shall be measured according
to the expected credit loss of the whole duration of the financial instrument; If the credit
impairment has occurred since the initial recognition, it shall be in the third stage, and the
loss provision shall be measured according to the expected credit loss of the whole duration
of the financial instrument. For financial instruments of the first and second stages, the
interest income shall be calculated according to the book balance and the actual interest rates;
for financial instruments of the third stage, the interest income shall be determined according
to its amortized costs and the real interest rates.
For purchased or originated financial assets with credit impairment, only the cumulative
variations in the expected credit losses during the entire period (up to the date as indicated by
balance sheet) after the initial recognition are recognized as loss provisions, and its interest
gains are determined according to the amortized costs of financial assets and the real interest
rates as adjusted by credit.
An increase or reversal of the loss provisions is recorded as an impairment loss or gain of the
current period. For debt instruments as held at fair values with variations recorded into other
comprehensive incomes, impairment losses or gains are recorded into the current profits and
losses, and other comprehensive incomes are adjusted synchronously.
A. Provisions of the company for the losses are measured on the expected credit losses for the
entire duration
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
The company divides notes and accounts receivable into several combinations and calculates
the expected credit losses with reference to the combination based on the characteristics of
credit risks.
For notes receivable by portfolios, the expected credit losses are calculated by the default risk
exposures and the expected credit loss rates of the entire duration with reference to
company's historical credit loss experience, and the combination with the current situation
and the forecast of future economic conditions. Determining basis of the portfolios is as
follows:
Portfolio A of notes receivable trade acceptances
Portfolio B of notes receivable bank acceptances
For accounts receivable by portfolios, a comparison table of the expected credit loss rates is
prepared between the age of accounts receivable and the entire duration to calculate the
expected credit losses with reference to company's historical credit loss experience, and the
combination with the current situation and the forecast of future economic conditions.
Determining basis of the portfolios is as follows:
Portfolio A of accounts receivable aging analysis
Portfolio B of accounts receivable specific identification
B. The company divides other receivables and long-term receivables into several portfolios
according to the characteristics of credit risks and calculates the expected credit losses on the
basis of such portfolios when individual other receivables and long-term receivables fail to
obtain the information to assess the expected credit losses at a reasonable cost. Determining
basis of the portfolios is as follows:
Portfolio A of other receivables deposits and securities receivable
Portfolio B of other receivables advanced money receivable
Portfolio A of long-term receivables lease receivables
For lease receivables by portfolios, the expected credit losses are calculated by the default
risk exposures and the expected credit loss rates of the entire duration with reference to
company's historical credit loss experience, and the combination with the current situation
and the forecast of future economic conditions. For other receivables and long-term
receivables divided into combinations other than lease receivables, the expected credit losses
are calculated by the default risk exposure and the expected credit loss rates for the next 12
36
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
months or the entire duration.
（6）Derivatives and Embedded Derivatives
Derivatives of the company' mainly include forward contracts, futures contracts and swap
contracts. Derivatives are initially measured at the fair values at the execution dates of the
derivative trading contracts, and are subsequently measured at their fair values thereafter. The
gains or losses arising from the variations in the fair values of the company's derivatives are
directly recorded into the current profits and losses.
Embedded derivative refers to the derivatives that are embedded in the non-derivative
instruments (i.e., the master contracts), which constitutes the hybrid contracts with the master
contracts. Where the master contracts contained inside the hybrid contract are assets
regulated by the Standards for Financial Instruments, the company does not split the
embedded derivatives from the hybrid contracts, and instead, the hybrid contracts are applied
as a whole to relevant provisions of the financial instrument criterion on the classification of
financial assets.
In the case that the master contracts contained in the hybrid contracts are not assets under the
financial instrument criterion but meet the following conditions, the company splits the
embedded derivative from the master contracts and settle as separate derivatives:
1) The economic characteristics and risks of the embedded derivative instruments are not
closely related to the economic characteristics and risks of the master contracts.
2) Separate instruments with terms associated with embedded derivatives are conforming to
the definition of derivatives;
3) The hybrid contracts are not measured at fair values and their variations are recorded
into the current profits and losses for accounting settlements.
（7）Offsets of Financial Assets and Liabilities
When the company is legally entitled to offset the recognized financial assets and financial
liabilities, and such right is currently enforceable, and when the company plans to settle such
financial assets and pay off the financial liabilities on a net basis or liquidate the financial
assets and liabilities, the amount of financial assets and financial liabilities offset against each
other are stated in the balance sheets. In addition, financial assets and financial liabilities are
shown separately in the balance sheets and are not offset against each other.
37
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（8）The Fair Values Determination of Financial Instruments
For financial instruments with active markets, the fair values of assets are determined by the
price the market participant who would have to pay to receive or transfer a liability from the
sale of such asset in an orderly transaction on the measurement date. Where there are
financial instruments without active markets, the fair values are determined by valuation
methodologies. In the valuations, the input values consistent with the characteristics of the
assets or liabilities as considered by the market participants in the transaction of the relevant
assets or liabilities, together with relevant observable input values as preferred reference are
adopted by the company through the valuation techniques that are applicable in the current
situation and are supported by sufficient data and other information available. An
unobservable input value is adopted when relevant observable input values cannot be
obtained or are not feasible to obtain.
11. Inventories
（1）Classification of inventories
Inventories are classified into: raw materials, consigned processing materials, low-cost
consumables, packaging materials, stock commodities, goods in progress, semi-finished
goods, finished goods, etc.
（2）Obtaining and Measurement of Inventories
The perpetual inventory systems are adopted for this enterprise's inventories. The inventories
shall be measured by their actual cost when they are obtained. Raw materials, works in
process, finished products, etc. shall be measured with the weighted average method when
they are being sent out. Low-value consumption goods shall be written off by one-off
write-off method when they are withdrawn for use. Circulation packaging materials shall be
recorded into cost according to the predicted usage times.
（3）Methods to make provision for loss on decline in value of inventories
If the cost of inventories is higher than the net realizable value at the end of each period, this
enterprise shall make the provision for the loss on decline in value of inventories. This
enterprise makes provision for the loss on decline in value of inventories on the ground of
each item of inventories. If the factors causing any write-down of the inventories have
38
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
disappeared, the amount of write-down shall be resumed and be reversed from the provision
for the loss on decline in value of inventories that has been made.
（4）Method for confirming the net realizable value of inventories
The net realizable value of inventories refers to the amount of the estimated selling price, less
the estimated costs of completion, the estimated selling costs and related tax payments.
12. Contract assets and contract liabilities
The company presents contract assets or liabilities in the balance sheet according to the
relationship between performance obligation and customer payment. Contract assets are the
right of the company to receive consideration for the goods transferred to the customer, and
the right depends on other factors other than the passage of time. Contract liability is the
obligation of the company to transfer goods to the customer for the consideration it has
received or receivable from the customer.
The contract assets are prepared for impairment according to the expected credit loss method.
No matter whether it contains significant financing components or not, the company measures
its loss provision according to the amount of expected credit loss in the whole duration on the
balance sheet date. If the expected credit loss is greater than the book amount of current
contract asset impairment provision, the difference is recognized as impairment loss,
otherwise, it is recognized as impairment gain. The relevant contract assets are deemed to be
unable to be recovered and have actual impairment loss, which shall be written down after
approval.
On the balance sheet date, the contract assets and liabilities are listed separately due to
different contracts. For contract assets and contract liabilities under the same contract, the net
amount is shown as the debit balance, and the contract assets or other non-current assets are
listed respectively according to their liquidity. If the provision for impairment has been
accrued, the balance at the end of the period minus the provision for impairment of contract
assets shall be listed; If the net amount is the credit balance, it shall be listed as contract
liabilities or other non-current liabilities according to their liquidity.
13. Held-for-sale assets
The Company will retrieve its book value by means of selling assets (including the exchange
of commercial non-monetary assets) instead of sequentially using a non-monetary asset or a
39
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
disposal group, and when meeting two of the following conditions, the book value will be
divided into held-for-sale category: (1) When a certain non-monetary assets or a certain
disposal group sells such kind of assets in similar transactions in accordance with the
convention, assets can be sold immediately under the current situation. (2)The Company has
made decisions for the selling plans and has acquired assured purchase commitment,
predicting that selling will be completed within one year. ( The selling, which can only be
sold after acquiring approval from relevant authorities or supervision departments according
to relevant provision requirement, has acquired its approval ).
The Company will be specifically for dividing the non-current assets or disposal group which
are acquired from reselling into on-sales category on acquisition date if on acquisition date
they can meet the stipulated condition that the predicted selling will be completed within one
year, and in a short term (usually 3 months) they are likely to meet other conditions of
dividing into on-sales category.
When the non-monetary assets and disposal group were measured by the Company at the
beginning or remeasured and divided into held-for-sale category on balance sheet date, if its
book value is higher than the net amount after fair value deducts selling expense, the book
value will be written down to the net amount after fair value deducts selling expense, and the
written-down amount will be confirmed as assets impairment losses and counted into the
current profits and losses, and the impairment provision with held-for-sale assets will be
withdrawn in the meanwhile. For the held-for-sale disposal group’s confirmed amount of loss
of asset impairment, the book value of goodwill will be deducted first, and its book value will
then be deducted proportionally according to the book value’s percentages of all non-current
assets in the disposal group which can be adopted by the measurement stipulations of
Accounting Standards for Business Enterprises NO.42- Held-for-sale Non-current Assets,
Disposal Groups and Operation Termination
If any increment occurs in the net amount after the held-for-sale non-current assets on the
subsequent balance sheet date deducts selling expense, the amount deducted previously will
be recovered and will be transferred back within the amount of asset impairment losses
confirmed after being divided into held-for-sale category, and the amount transferred back
will be counted into the current profits and losses. There will be no restitution for asset
impairment losses confirmed before being divided into held-for-sale category. The amount
previously written down by the disposal group held for sale shall be restored and reversed
within the amount of asset impairment loss recognized by non-current assets according to the
40
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
measurement provisions of accounting standards for Business Enterprises No. 42 –
non-current assets held for sale, disposal group and termination of operation after being
classified as held for sale, and the reversed amount shall be included in the current profits and
losses. The book value of the offset goodwill and the non-current assets that are measured
according to the accounting standards for Business Enterprises No. 42 – non-current assets
held for sale, disposal group and termination of operation shall not be reversed before they are
classified into the categories held for sale.
Non-current held-for-sale assets or non-current assets in the disposal group shall not be
depreciated or amortized, and interest and other expenses on liabilities held in the disposal
group for sale shall continue to be recognized.
When the non-current assets or the disposal group can not meet the conditions of dividing into
on-sales category, the Company will not continue to divide it into on-sales category or remove
the non-current assets from the on-sales disposal group, and the valuation will be made
according to the lower one between two of followings: （1）Book value before being divided
into on-sales category, and the amount of money after being under the situation where book
value is supposed not to be divided into on-sales category and adjustment is made in
depreciation, amortization or impairment which should have been confirmed. （ 2 ）
Recoverable amount.
When derecognizing the on-sales non-current assets or disposal group, the Company will
count the gains and losses which are yet to be confirmed into the current profits and losses.
14. Long-term equity investment
The long-term equity investment in this section refers to the long-term equity investment of
this enterprise that is able to control to or does joint control with or significant influences over
the invested enterprise. For the long-term equity investment of this enterprise that is not able
to control to or does not do joint control with or have significant influences over the invested
enterprise, this enterprise shall record it as available-for-sale financial asset or the financial
asset measured by its fair value with its changes in fair value recorded into the profits or
losses of current period as the changes. For details of its accounting policy, please refer to
Note 3.10 "Financing Instruments".
The term "joint control" refers to the joint control over an arrangement of this enterprise in
accordance with the contracts and agreements, and decisions over relevant activity of such
41
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
arrangement shall not be unless the assent on sharing the control power. The term "significant
influences" refers to this enterprise's power to participate in making decisions on the financial
and operating policies of the invested enterprise, but not to control or do joint control together
with other parties over the formulation of these policies.
（1）Determination of investment cost
For the merger of enterprises under the same control, it shall, on the date of merger, regard the
share of the book value of the owner's equity of the merged enterprise as the initial cost of the
long-term equity investment. The difference between the initial cost of the long-term equity
investment and the payment in cash, no-cash assets transferred as well as the book value of
the debts borne by the merging party shall offset against the capital reverse. If the capital
reserve is insufficient to dilute, the retained earnings shall be adjusted. If the consideration of
the merging enterprise is that it issues equity securities, it shall, on the date of merger, regard
the share of book value of the owner’s equity of the merged enterprise as the initial cost of the
long-term equity investment. The total face value of the stocks issued shall be regarded as the
capital stock, while the difference between the initial cost of the long-term equity investment
and total face value of the shares issued shall offset against the capital reserve. If the capital
reserve is insufficient to dilute, the retained earnings shall be adjusted. For the merger of
enterprises under the same control through gaining the shares of the combined enterprise by
multiple steps of deals, it shall deal with it in the following two ways depending on that if it
belongs to "a package deal": if it belongs to "a package deal", it shall deal with all the deals as
one obtaining the control power; if it does not belong to "a package deal", it shall, on the date
of merger, regard the share of book value of the owner’s equity of the merged enterprise as
the initial cost of the long-term equity investment. The total face value of the stocks issued
shall be regarded as the capital stock, while the difference between the initial cost of the
long-term equity investment and total face value of the shares issued shall offset against the
capital reserve. If the capital reserve is insufficient to dilute, the retained earnings shall be
adjusted. The equity investment held by this enterprise before the date of merger shall be
accounted for by equity method, or shall be recorded as the other comprehensive income
recognized as available-for-sale financial asset and not accounted for.
For the merger of enterprises not under the same control, it shall, on the date of merger, regard
the share of the book value of the owner's equity of the merged enterprise as the initial cost of
the long-term equity investment. The merger costs include the assets paid, liabilities occurred
or borne and sum of the fair value of the equity securities issued by the purchaser. For the
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
merger of enterprises not under the same control through gaining the shares of the combined
enterprise by multiple steps of deals, it shall deal with it in the following two ways depending
on that if it belongs to "a package deal": if it belongs to "a package deal", it shall deal with all
the deals as one obtaining the control power; if it does not belong to "a package deal", it shall,
on the date of merger, regard the sum of book value of the owner’s original equity of the
merged enterprise and the newly increased investment cost as the initial cost of the long-term
equity investment. For the shares originally held by this enterprise accounted for by weighted
equity method, the relevant other comprehensive income shall not be accounted for
temporarily. For the equity investment accounted for as available-for-sale financial asset, the
difference of its fair value and its face value and the accumulated changes in its fair value
originally recorded as other comprehensive income shall be switched to the profits or losses
of the current period.
The audit cost, law service cost, evaluation and consultation fees and agent commissions as
well as other related administration costs occurred and borne by the merging or purchasing
enterprise for the purpose of merger, shall be recorded into the profits or losses of current
period at the time when the costs occurred.
Other equity investments except the long-term equity investment formed by merger of
enterprises shall be initially ascertained by their costs which, depending on the different ways
in acquiring the long-term equity investments, shall be recognized separately as cash
purchasing prices actually paid by this enterprise, fair value of the equity securities issued by
this enterprise, agreed value of the investment contracts or agreements, fair value or original
book value of the assets obtained by exchange of non-monetary assets, the fair value of the
long-term equity investment itself, etc. The relevant expenses, tax payments as well as other
necessary expenses directly associated with obtaining the long-term equity investment shall
be recorded into the investment costs as well. If this enterprise is able to do joint control or
significant influence, which does not constitute control, over the invested entity as a result of
additional investment, the long-term equity investment cost shall be the sum of the fair value
of the equity investment ascertained in accordance with the Accounting Standards for
Enterprises No. 22 - Recognition and Measurement of Financial Instrument and the cost of
the increased investment.
（2）Subsequent measurement and recognition of profit or loss
A long-term equity investment of this enterprise that does joint control (not including joint
venture) or significant influences over the invested entity shall be measured by employing the
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
equity method. Besides, the cost method is employed in this enterprise's financial reports to
measure the long-term equity investment that could form control over the invested entity.
1) Long-term equity investment calculated under the cost method
The price of a long-term equity investment measured by employing the cost method shall be
included at its initial investment cost. If there are additional investments, the cost of the
long-term equity investment shall be adjusted. Except the prices actually paid when obtaining
the investment or cash dividends or profits being approved in the consideration but not yet
issued, the investment income of the current period shall be recognized in accordance with the
cash dividends or profits being approved by the invested entity.
2) Long-term equity investment calculated under the equity method
If the initial cost of a long-term equity investment is more than the investing enterprise's
attributable share of the fair value of the invested entity's identifiable net assets for the
investment, the initial cost of the long-term equity investment may not be adjusted. If the
initial cost of a long-term equity investment is less than the investing enterprise's attributable
share of the fair value of the invested entity's identifiable net assets for the investment, the
difference shall be included in the current profits and losses and the cost of long-term equity
investment shall be adjusted simultaneously.
When employing the equity method, this enterprise shall, in accordance with the attributable
share of the net profits or losses of the invested entity, recognize the investment profits or
losses and adjust the book value of the long-term equity investment. This enterprise shall, in
the light of the profits or cash dividends declared to distribute by the invested entity, calculate
the proportion it shall obtain, and shall reduce the book value of the long-term equity
investment correspondingly. Where any change is made to the owner's equity other than the
net profits and losses of the invested entity, the book value of the long-term equity investment
shall be adjusted and included in the capital reserves. This enterprise shall, on the ground of
the fair value of all identifiable assets of the invested entity when it obtains the investment,
recognize the attributable share of the net profits and losses of the invested entity after it
adjusts the net profits of the invested entity. If the accounting policies and accounting periods
adopted by the invested entity are different from those adopted by this enterprise, an
adjustment shall be made to the financial statements of the invested entity in accordance with
the accounting policies and accounting periods of this enterprise and recognize the investment
profits or losses and other comprehensive incomes. For the transactions between this
44
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
enterprise and its joint ventures and associated entities, where the assets invested or sold do
not constitute a business, the unrealized internal transaction profits or losses shall be
calculated in accordance with proportion shared, with the proportion shared by this enterprise
offset and recognize the investment profits or losses based thereof. However, if losses
occurred in the internal transaction between the invested entities is the impairment loss of
transferred assets, they shall not be offset. When the assets invested by this enterprise to its
joint ventures or associated entities constitute a business, and the investing party obtains
long-term equity but without control power, the fair value of the invested business shall be
recognized as the initial investment cost of the additional long-term equity investment. The
total difference between the original investment cost and the book face of the invested
business shall be recorded into the profits or losses of the current period. If the assets
purchased from the joint ventures or associated entities constitute a business, this enterprise
shall account for the business in accordance with this enterprise Accounting Standard No. 20 -
Business Combinations, with the total profits or losses associated with the transaction
recognized.
The Company bears the net losses of its invested business to the limit of the book value of its
long-term equity investment and other long-term equity that in real terms constitutes
investment on the business. For additional loss of its invested business, if the Company is
obligated to undertake, it shall be recognized as Retained Earnings accordingly and recorded
in current investment losses. If the invested business earns profits afterwards, the Company
shall reinstate and recognize its share of gains after compensating its unrecognized share of
losses.
For the long-term equity investment held by the Company before the first execution of the
new accounting criterion of the associated enterprises and joint ventures, if there is debit
difference of the equity investment related to the investment, should be included in the current
gains and losses according to the amount of the straight-line amortization during the original
remained period.
3) Purchase of minority interest
While compiling consolidated financial statements, the Company adjusts its capital reserve in
terms of the difference between the increase of long-term equity investments due to purchase
of minority interest and its share of the subsidiaries’ net assets since the purchase (or
combination) date or dates. If its capital reserve is not sufficient to write down the difference,
45
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
then the Company adjusts its retained income.
4) Disposal of long-term equity investment
In consolidated financial statements, the Company records in shareholders’ equity the
difference between partial disposals of its long-term equity investments in its subsidiaries and
its share of the subsidiaries’ net assets if it does not lose control of the subsidiaries; and if
such partial disposals result in loss of its control of the subsidiaries, the difference shall be
treated in accordance with the accounting policies related and specified in “Compiling
Principles for Consolidated Financial Statements”. (Please refer to (2) in Note 3.6)
For disposals of long-term equity investments under other circumstances, the difference
between the book value and the actual received consideration is recorded in current profit and
loss.
For the long-term equity investments calculated by equity method, the same method applies to
the remaining equity after disposal. Meanwhile, the other comprehensive gains originally
recorded in shareholders’ equity are treated pro rata by the same method how the invested
businesses handle the accounts while directly disposing the related assets or liabilities. The
investor recognizes the ownership interest due to equity changes except net profit and loss,
other comprehensive gains and profit distribution, and carries it over pro rata to current profit
and loss.
For long-term equity investments calculated by costs method, the same method applies to the
remaining equity after disposal. Other comprehensive gains calculated and recognized by
equity method or recognition and measurement principles for financial instruments before the
Company obtains control of the invested businesses are treated on the same basis that the
invested businesses directly dispose the related assets or liabilities, and it will be carried over
pro rata to current profit and loss; and among the invested businesses’ net assets that are
calculated and recognized by equity method are all other equity changes than net profit and
loss, other comprehensive gains and profit distribution carried over pro rata to current profit
and loss.
For disposals of long-term investment equity resulting in loss of control over the invested
businesses, when compiling individual financial statements, the Company changes to adopt
equity method to calculate the remaining equity that is still sufficient to exert joint control or
significant influence, and to make adjustments as since it was acquired; and if the remaining
equity is not sufficient, it will be handled in accordance with the relevant recognition and
46
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
measurement principles for financial instruments and the difference between its fair value and
book value will be recorded in current profit and loss since the Company loses control of the
invested businesses. For other comprehensive gains recognized by equity method or
recognition and measurement principles for financial instruments before the Company obtains
control over the invested businesses, the Company adopts the same basis to handle the
accounts as the invested businesses directly dispose the related assets or liabilities, and among
the invested businesses’ net assets that are calculated and recognized by equity method are all
other equity changes than net profit and loss, other comprehensive gains and profit
distribution carried over pro rata to current profit and loss. For the remaining equity
calculated by equity method, other comprehensive gains and other ownership interests will be
carried over pro rata while for those treated in accordance with the recognition and
measurement principles for financial instruments, other comprehensive gains and other
ownership interests will be carried over entirely.
Under the circumstances that the Company loses joint control over or has no significant
influence on the invested businesses due to partial equity disposal, the remaining equity
changes to be calculated in accordance with the recognition and measurement principles for
financial instruments, and the difference between its fair value on the date that the Company
loses the joint control and significant influence and the book value is recorded in current
profit and loss. For other comprehensive gains recognized due to calculation of the original
equity investments by equity method, the Company adopts the equity method no longer but
the same basis to handle the accounts as the invested businesses directly dispose the related
assets or liabilities while carrying over to current profit and loss all the ownership interest
recognized due to other equity changes than net profit and loss, other comprehensive gains
and profit distribution.
If the Company gradually loses control of a subsidiary through multiple transactions, which is
a package deal as a whole, then all these transactions will be treated as control losing equity
disposal, and before loss of control, the difference between each transaction consideration and
the book value of the corresponding long-term equity investment is recognized as other
comprehensive gains and in the end, carried over to current profit and loss upon loss of
control.
15. Investment property
Investment properties are properties to earn rentals or for capital appreciation or both.
47
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Examples include land leased out under operating leases, land held for long-term capital
appreciation, buildings leased out under operating leases, (including buildings that have been
constructed or developed for future lease out under operating leases, and buildings that are
being constructed or developed for future lease out under operating leases).
The Company makes initial measurement at the costs that the properties are acquired and
records as part of the property costs the subsequent expenses that could bring economic
benefit inflows and be measured reliably while other subsequent expenses as part of current
profit and loss.
The company's investment property uses the cost model to carry on the follow-up
measurement. Such properties are depreciated or amortized in accordance with the relevant
regulations for fixed assets or intangible assets.
16. Fixed assets and accumulated depreciation
（1）Criteria for recognition of fixed assets
Fixed assets refer to tangible assets that are held for production, services, leases or operations
and the useful life of which are over one accounting year. Fixed assets are recognized if it
produces economic benefit inflows and its costs can be measured reliably. The Company
makes initial measurements on fixed assets at the costs that they are acquired.
（2）Classification and depreciation policy of fixed assets
The company adopts the Straight-line method to carry out depreciation. The fixed assets shall
begin to be depreciated upon reaching the intended usable state, and shall cease to be
depreciated upon termination of recognition or when they are classified as non-current &
held-for-sale assets. Without taking into account the provision for impairment, the Company
determines the annual depreciation rates of all types of fixed assets according to the type of
fixed assets, the expected useful life and the estimated residual value as follows:
Item Residuals yearly
Method Useful life (Year)
rate % depreciation %
Straight-line
House and building 25—35 3 2.77-3.88
depreciation
Straight-line
Machinery equipment 7-15 3 6.47-13.86
depreciation
Transportation Straight-line
8-10 3 9.70-12.13
equipment depreciation
electronic equipment and
Straight-line 5-10 3 9.70-19.40
others
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Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
depreciation
Thereinto, the fixed asset whose asset impairment provision has been withdrawn should also
have its accumulated amount deducted to count and confirm the depreciation rate.
At the end of each year, the company reviews the useful life, estimated net residual value and
depreciation method of fixed assets. If the estimated useful life is different from the original
estimate, the useful life of the fixed assets shall be adjusted. If the estimated net residual value
is different from original estimated, the estimated net residual value shall be adjusted.
（3）Recognition basis, pricing and depreciation method of fixed assets by finance lease
Fixed assets leased by the Company are recognized as financing leased fixed assets when
they meet one or more of the following criteria:
1) At the end of the lease term, ownership of the leased assets is transferred to the
Company.
2) The Company has the option to purchase leased assets, and the contracted purchase
price is expected to be well below the fair value of the leased assets at the time of
exercise of the option, So it can be reasonably certain that the Company will exercise
this option on the date of commencement of the lease.
3) Even if ownership of the assets is not transferred, the lease term accounts for the
majority of the useful life of the leased assets.
4) The present value of the minimum lease payment of the Company at the date of
commencement of the lease is almost equivalent to the fair value of the leased assets
on the date of commencement of the lease.
5) The leased assets are of a special nature, if no major modifications are made, only the
company can use them.
Fixed assets from financial leasing are depreciated during the useful life if it is
reasonable to determine that the ownership could be obtained upon lease expiration;
otherwise, the Company should choose the shorter of the lease period and the
remaining useful life to depreciate the assets.
（4）Charge for Major repair
The Company conducts regular checking on major overhaul fee incurred in the fixed
asset, and any parts of the fee that have unambiguous evidence to indicate they conform
with the condition for confirming fixed asset will be counted into the fixed asset costs,
49
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
otherwise into the profit and loss of the current period. During the interval period of
regular major overhaul, the fixed asset will be depreciated as before.
17. Construction in progress
The costs of construction in progress include all necessary project expenditures, the
borrowing expenses that should be capitalized before the work reaches the expected usable
status and other relevant expenses.
Construction in progress changes to fixed assets when it reaches the expected usable status.
18. Borrowing expenses
Borrowing expenses include interest, amortization of discount or premium, auxiliary expenses,
translation differences arising from borrowings in foreign currency etc. The Company starts to
capitalize the borrowing expenses in direct connection to purchase, construction or production
of the assets that meet capitalization conditions when there are assets expenditures and
borrowing expenses incurred and/or the Company starts all the necessary events to purchase,
construct or produce such assets till the assets can be used and sold. Other borrowing
expenses are recognized as costs when incurred.
The Company capitalizes the actual interest expense incurred by use of special borrowings,
less the interest income from the remaining borrowing funds in bank or any investment
income earned from the interim investment of those borrowings; and for general borrowings,
the amount to capitalize is the weighted average of the accumulated assets expenditures in
excess of the special borrowings times the capitalization rate of the used general borrowings,
which is determined by the weighted average interest rate of the general borrowings.
During capitalization, all translation differences of special borrowings in foreign currency
should be capitalized while those of general borrowings in foreign currency are recorded in
current profit and loss.
The qualifying assets to be capitalized are fixed assets, investment properties and inventories
which need to be acquired, constructed or produced through a long period of time, in order to
become ready for its intended use or sale.
The Company stops capitalization of borrowing costs if an abnormal interruption more than 3
consecutive months occurs during purchase, construction or production of the assets that are
eligible to capitalization till all those restarts.
50
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
For the special loan borrowed for the purchase or production of assets eligible for
capitalization, the amount of the borrowing costs incurred in the current period of a special
loan, less the amount of interest earned in the bank on unused borrowed funds or the return on
the investment obtained by a temporary investment, to determine the amount of capitalization
of borrowing costs.
If general borrowings are used to purchase, construct or produce the capitalization eligible
assets, the borrowing cost to capitalize is the weighted average of the accumulated assets
expenditures in excess of the special borrowings times the capitalization rate of the used
general borrowings, which is determined by the weighted average interest rate of the general
borrowings.
19. Intangible assets
The Company makes initial measurements on intangible assets in terms of the costs and
determines the useful life when obtaining the assets. For intangible assets of a limited useful
life, from the time the assets are available for use, the Company adopts the amortization
method that reflects realization of the expected economic benefits, or the straight-line
amortization method if unable reliably to determine how to realize the expected economic
benefits; and no amortization are made for intangible assets of an unlimited useful life.
At the end of each year, the Company reviews the useful life and amortization methods of
intangible assets of a limited useful life and makes adjustments and accounting treatment if
different from the previous estimates.
For the intangible assets that are estimated to produce no more economic benefits in the
future, the Company records the book value of such assets all in current profit and loss.
20. Research and development expenses
The expenditures for internal research and development projects of an enterprise shall be
classified into research expenditures and development expenditures.
The research expenditures shall be recorded into the profit or loss for the current period.
The development expenditures shall be capitalized when they satisfy the following conditions
simultaneously: It is feasible technically to finish intangible assets for use or sale; Having the
intention to complete the intangible asset and use or sell it; The usefulness of methods for
intangible assets to generate economic benefits shall be proved, including being able to prove
that there is a potential market for the products manufactured by applying the intangible assets
51
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
or there is a potential market for the intangible assets itself for the intangible assets will be
used internally; It is able to finish the development of the intangible assets, and able to use or
sell the intangible assets, with the support of sufficient technologies, financial resources and
other resources; Expenditures attributable to the development phase of the intangible assets
can be measured reliably. Development expenditures that do not meet the above conditions
are included in the profits and losses of the current period.
After meeting the above conditions, the corresponding projects of the company study their
technical feasibility and economic feasibility, and enter the development stage after the
formation of the project.
21. Long-term amortizable expenses
Long-term amortized expenses are valued at the actual costs and amortized at average in an
estimated beneficial period of time. If those cannot benefit the Company in future accounting
periods, the remaining will be recorded all in current profit and loss.
22. Impairment of the long-term assets
On balance sheet dates, the Company determines whether there are impairments occurring to
fixed assets, construction in progress, intangible assets of a limited life, investment properties
measured in the cost model as well as non-current and non-financial assets like the long-term
equity investments on subsidiaries, joint ventures and associated companies. If impaired, the
Company estimates the retrievable amount and conducts an impairment test. Impairment tests
need to be done on goodwill, intangible assets of an unlimited life and the intangible assets
that are not yet to reach the usable status, no matter they are impaired or not.
If the impairment test result shows the retrievable amount lower than the book value,
impairment provisions will be set aside and recorded in impairment loss. The retrievable
amount is the fair value of the assets less the disposal expenses or the present value of the
estimated future cash flows of the assets, whichever is higher. The fair value of the assets is
determined in terms of the price specified in the selling agreement that is fair trade; if no
selling agreement but there is an active assets market existing, it is determined in terms of the
buyer’s offer; and if no selling agreement and active assets market, the fair value can be
estimated based on the best available information. Disposal expenses include all related legal
charges, taxes, delivery fees or the direct expenses incurred to have the assets reach the usable
or sellable status. To determine the present value of the estimated future cash flows from the
assets, the Company chooses an appropriate discount rate in the light of the continual usage of
the assets and the estimated future cash flows occurring upon final disposal. Impairment
52
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
provisions of the assets are calculated and recognized on the basis of individual assets. If
unable to estimate the retrievable amount of individual assets, the Company determines the
amount by reference to the asset group that includes the individual assets. Asset groups are the
minimum assets combination that independently produces cash inflows.
For the goodwill separately listed in financial statements, while an impairment test being
conducted, the book value is apportioned to the asset groups or combination of asset groups
expected to benefit from the synergy effects arising from business combinations. The
Company recognizes impairment losses when the test result shows that the retrievable amount
of the asset groups or combination of asset groups is lower than their book values. The
impairment loss will be first used to write down the book values of the asset groups or
combination of asset groups and then those of other assets pro rata.
Once the aforesaid impairment losses are recognized, they cannot be reversed in the future.
23. Employee compensation
Employee compensation refers to all kinds of rewards or compensations given in return for
employees’ services or employment termination. It includes short-term compensation,
post-employment benefits, demission benefit.
Short-term compensation includes payroll, bonus, allowances and subsidies, employee
welfare, medical insurance, injury insurance and birth insurance, housing fund, labor union
and employee training expenditures, non-monetary benefits and other short-term rewards. It
recognizes as liabilities the actual short-term compensation incurred during the accounting
period that the employees provide their services and records in current profit and loss or the
relevant asset costs. Non-monetary benefits are measured at the fair value.
Post-service benefits mainly include defined contribution plan and defined benefit plan. The
defined contribution plan mainly includes basic pension, unemployment insurance etc. The
corresponding contributions are recorded in the relevant asset costs or current profit and loss
when incurred.
When terminating labor relations before expiration of contract, or layoffs with compensations,
and the Company cannot terminate the labor relations unilaterally or reduce the demission
welfare, remuneration and liabilities produced from the demission welfare should be
determined and included in current profits and losses when determining the costs of
demission welfare and recombination. However, demission welfare not fully paid within 12
months after annual Reporting Period should be handled the same as other long-term
53
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
employees’ payrolls.
The inside employee retirement plan is treated by adopting the same principle with the above
demission welfare. The Company would record the salary and the social security insurance
fees paid and so on from the employee’s service terminative date to normal retirement date
into current profits and losses (demission welfare) under the condition that they meet the
recognition conditions of Retained Earnings.
The other long-term welfare that the Company offers to the staffs, if met with the defined
contribution plans, should be accounting disposed according to the defined contribution plans,
while the rest should be disposed according to the defined-benefit plan.
24. Estimated liabilities
The Company recognizes obligations relating to contingent events as estimated liabilities if
they meet the following conditions:
A. That obligation is a present obligation of the enterprise;
B. It is probable that an outflow of economic benefits from the enterprise will be required to
settle the obligation;
C. A reliable estimate can be made of the amount of the obligation.
The estimated liabilities is initially measured on the basis of the best estimate of the
expenditure required to meet the relevant current obligations, taking into account factors such
as risks, uncertainties and the time value of the currency associated with contingencies.
Where the time value of the currency has a significant impact, the best estimate is determined
by discounting the relevant future cash outflows.
When all or some of the expenses necessary for the liquidation of an estimated liabilities of an
enterprise is expected to be compensated by a third party, the compensation should be
separately recognized as an asset only when it is virtually certain that the reimbursement will
be obtained. Besides, the amount recognized for the reimbursement should not exceed the
book value of the estimated liabilities.
25. Share-based Payment
（1）Types of Share-based Payment
It is divided into equity-settled share-based payment and cash-settled share-based payment.
（2）Recognition of Equity Instruments’ Fair Value
For the granted equity instruments that there is an active market for, e.g. options, the
54
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Company determines the fair value by reference to the quotation prevailing in the active
market. For those that there is no active market for, the options pricing model is adopted to
determine the fair value.
（3）Recognition Basis for Best Estimates on Exercisable Equity Instruments
On each balance sheet date during the vesting period, the Company makes the best estimates
based on the latest number changes of its employees and adjusts the quantity of estimated
exercisable equity. The final quantity of estimated exercisable equity instruments should be
consistent with that of the actual ones on vesting dates.
26. Recognition Principles of Revenues
The company recognizes revenue when the contract performance obligations have been
fulfilled such as the customer has gained control over relevant goods or services.
If two or more performance obligations are included in the contract, the company shall, on
the commencement date of the contract, apportion the transaction price to the individual
performance obligations according to the relative proportion of the individual selling prices
of the commodities or services promised by the individual performance obligations, and
measure the income according to the transaction price apportioned to the individual
performance obligations.
If one of the following conditions is met the company shall be obliged to fulfil its
performance obligations over a certain period; otherwise, it shall be obliged to fulfil its
performance obligations at a certain point:
A. the customer simultaneously receives and consumes the benefits provided by the
company’s performance as the company performs; or
B. the company’s performance creates or enhances an asset that the customer controls as the
asset is created or enhanced; or
C. the commodities produced by the company in the course of its performance are
irreplaceable and the company has the right to collect payments for the part of
performance that has been completed so far during the entire contract period.
For performance obligation that is to be fulfilled over a period of time, the company
recognizes revenue based on the performance obligation cannot be reasonably measured, if
the cost incurred is expected to be recovered, the revenue shall be recognized according to the
amount of cost incurred, until the progress can be reasonably determined.
55
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
For performance obligation that is to be fulfilled at certain point, the company recognizes
revenue when the customer gains control of the relevant goods or services.
（1）Sale of Goods
The company recognizes the realization the revenue sale of the goods when the main risk
or reward in the ownership of the goods has been transferred to the buyer, the right to
continue management and actual control over the goods is no longer exercised, relevant
income has been obtained or the proof of receipt has been obtained, and the costs related to
the sale of the goods can be measured reliably.
（2）Specific Principles of Main Revenues
Specific recognition principle of sales income for the vehicle air conditioners are
subdivided into three situations according to customer groups:
1）Big customers
The main way of cooperation is that the company ships the goods to the designated or
cooperative third-party logistics companies who will be responsible for warehousing and
distribution services according to the production requirements of customers. The customer
issues the debit notes according to the actual amount of the production plan monthly, and
the salesmen issue the billing notices according to the customers' bills of lading combined
with the customer's consumption, contract unit price, bill of lading and the like, while the
finance department issues invoices to recognize the sales revenues.
2） Customers who pay first and pick up later.
According to the customers' demands and relevant billing information, and after the
customers pay and confirm the payments, the salesmen deliver the goods according to the
unit prices of the sales contracts and the quantities required by the customers with the
invoice notices, while the finance department issues invoice to complete the transaction.
3） Aftermarket customers
The salesmen ship the goods to the customers according to the contracts and the customers'
requirements, and issue the invoice notices to the customers according to the unit prices
and shipment quantities as agreed in the contracts after the milestones, while and the
finance department issues invoices to recognize the sales revenues.
56
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（3）Income from providing services
The company shall recognize the income according to the progress of completed services
within a period of time. The progress of completed services shall be determined according to
the proportion of the cost incurred to the total cost. On the balance sheet date, the Company
re-estimates the progress of completed services so as to reflect the change of performance.
When the company confirms revenue according to the progress of completed services, the
part that has obtained unconditional right of collection shall be recognized as receivables, the
rest shall be recognized as contract assets, and the loss reserves shall be recognized based on
expected credit loss for receivables and contract assets; If the company has received or the
contract price exceeding the completed labor progress, the excess part will be recognized as
the contract liability. The company shall show the contract assets and liabilities under the
same contract in net.
27. Governmental subsidies
Government subsidy means the Company gratuitously obtains monetary assets or
non-monetary assets from the government, not including the capital into which the
government invests as an investor who has relevant ownership interest. Government subsidies
are divided into the subsidy related to assets and the other related to earnings. Government
subsidies related to monetary assets will be measured according to the amount received or the
amount receivable. Those which related to non-monetary assets will be measured according to
fair value; For any fair value which cannot be reliable to be obtained, the assets will be
measured according to the nominal amount, and the one measured according to the nominal
amount will be directly counted into the current profits and losses.
Government subsidies can only be recognized when the company is able to meet the
conditions attached to government subsidies and is able to receive government subsidies.
Government subsidies are divided into asset-related government subsidies and income-related
government subsidies. Government subsidies related to assets refer to government subsidies
obtained by companies for the purchase, construction or other formation of long-term assets.
Government subsidies related to income refer to government subsidies in addition to those
related to assets.
The government grants pertinent to assets are recognized as deferred income and are credited
to profit or loss by stages in accordance with a reasonable and systematic method within the
useful life of the pertinent assets. If the pertinent assets are sold, transferred, scrapped or
57
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
destroyed before the end of their useful life, the non-allocated pertinent deferred income
balance shall be transferred to the profit or loss of the period of assets disposal, and the
recognized government grant needs to be refunded, then it shall write down the carrying
amount of the relevant deferred income and the excess part shall be included in the current
profit and loss. The government grants pertinent to income that are used to compensate the
relevant costs or losses of the subsequent period of the enterprise are recognized as deferred
income and are credited to the current profit or loss for the period when the relevant costs,
expenses or losses are recognized; those government grants used for compensating the related
expenses or losses incurred to the enterprise shall be directly included in the current profits
and losses.
For the government subsidy which includes both the assets related part and the income related
part, the different parts are treated separately; if it is difficult to distinguish, the whole is
classified as the government subsidy related to the income.
Government subsidies related to the daily activities of the company shall be included in other
earnings in accordance with the substance of the economic business. Government subsidies
not related to the daily activities of the company shall be included in the non-operating
income and expenditure.
28. Deferred income tax assets/Deferred income tax liability
The balance between the book value and the tax basis of some items of assets and liabilities,
as well as the temporary differences issued as the balance between the book value and the tax
basis of the tax basis items that unrecognized as assets and liabilities but can be determined as
per the provisions of tax law, which shall be determined as the deferred income tax assets and
the deferred income tax liabilities in accordance with the balance sheet debt law.
Taxable temporary differences related to the initial recognition of goodwill, as well as the
initial recognition of an asset or liability in a transaction that neither belongs to a business
consolidation, nor affects the accounting profit and taxable income (or deductible loss) when
it happens, the relevant deferred income tax liabilities shall not be recognized. In addition, as
for taxable temporary differences associated with investments in subsidiaries, associates and
joint ventures, if the Company could control the reverse time of such differences and such
differences cannot be reversed in the foreseeable future, the relevant deferred income tax
liabilities also shall not be recognized. Apart from the above-mentioned exceptional cases, the
Company recognizes all other deferred income tax liabilities caused by taxable temporary
differences.
58
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Deductible temporary differences related to the initial recognition of an asset or liability in a
transaction that neither belongs to a business consolidation, nor affects the accounting profit
and taxable income (or deductible loss) when it happens, the relevant deferred income tax
assets shall not be recognized. In addition, as for deductible temporary differences associated
with investments in subsidiaries, associates and joint ventures, if such differences cannot be
reversed in the foreseeable future or are not likely to obtain the taxable income to deduct the
deductible temporary differences of the taxable income, the relevant deferred income tax
assets shall not be recognized. Apart from the above-mentioned exceptional cases, the
Company recognizes other deferred income tax assets caused by deductible temporary
differences within the limit of likely obtained taxable income that can be used to deduct the
deductible temporary differences of the taxable income.
The corresponding deferred tax assets of deductible loss and tax reduction that can be carried
forward during subsequent years shall be recognized within the limit of likely obtained future
taxable income that can be used to deduct the deductible loss and tax reduction.
As per the provisions of tax law, the deferred income tax assets and deferred income tax
liabilities shall be measured at the applicable tax rates used during the period of expectation
recovery of relevant assets or pay-off relevant liabilities at the balance sheet date.
The book value of the deferred income tax assets shall be re-checked at the balance sheet date.
The book value of the deferred income tax assets shall be written-down if it is unlikely to
obtain sufficient taxable income in the future to deduct the benefit of the deferred tax assets
and the written-down amount shall be carried forward if it is likely to obtain sufficient taxable
income.
29. Income tax expenses
Income tax expenses include current income tax and deferred income tax. Except that the
adjusted goodwill arising from the merger of enterprises, or the deferred income tax related to
the transaction or event directly included in the owner's equity is included in the owner's
equity, it is included in the profit and loss of the current period as an income tax expense.
The current income tax is the amount of income tax payable in the current period, which is
calculated on the basis of the taxable income of the current period. The amount of taxable
income is derived from the corresponding adjustment of the pre-tax accounting profits for the
current year in accordance with the relevant provisions of the tax law.
According to the temporary difference between the book value of assets and liabilities on the
balance sheet date and the taxable basis, the Company uses the balance sheet debt method to
59
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
recognize deferred income tax.
All taxable temporary differences recognize the relevant deferred income tax liabilities unless
the taxable temporary differences arise in the following transactions: A 、 The initial
recognition of goodwill, or the initial recognition of assets or liabilities arising from a
transaction with the following characteristics: the transaction is not a merger of enterprises,
and the transaction does not affect neither accounting profits nor taxable income at the time of
the transaction; B、For taxable temporary differences related to investments in subsidiaries,
joint ventures and associated enterprises, the timing of the return of the temporary differences can be controlled
and the temporary difference is likely not to be reversed for the foreseeable future.
For deductible temporary differences, deductible losses and tax credits that can be carried
forward in subsequent years, the company is likely to recognize deferred income tax assets,
which arising from limit to deductible temporary differences, deductible losses and tax credits
for future taxable income, unless the deductible temporary difference arises in the following transactions: A、the
transaction is not a merger of enterprises and does not affect neither accounting profits nor
taxable income at the time of the transaction;；B、Where the deductible temporary differences
related to the investments of subsidiaries, joint ventures and joint ventures meet the following
conditions at the same time, the corresponding deferred income tax assets shall be confirmed:
Temporary differences are likely to turn back in the foreseeable future and are likely to be
used to offset taxable income against temporary differences in the future.
On the balance sheet date, the Company's deferred income tax assets and deferred income tax
liabilities are measured at the applicable tax rate for the period during which the assets are
expected to be recovered or the liabilities are liquidated, it also reflects the income tax impact
of the expected recovery of assets or liquidation of liabilities on the balance sheet date.
On the balance sheet date, the Company reviews the book value of deferred income tax assets.
If it is likely that sufficient taxable income will not be available in future periods to offset the
benefits of deferred income tax assets, the book value of deferred income tax assets will be
written down.
30. Operational leasing
The Company will transfer substantially all the risks and rewards of ownership of an asset
lease are recognized as a finance lease. Other forms of lease besides financial leasing are
considered as operating leasing.
At the commencement of the lease term, an amount equal to the lower of the fair value of the
60
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
leased asset and the present value of the minimum lease payments shall be regarded as the
recorded value of the leased assets and an amount equal to the minimum lease payments shall
be recognized as a long-term recorded value of the leased assets of payables. The balance
between the recorded amount of the leased asset and the recorded amount of the payable shall
be accounted for as unrecognized finance charge.
Lease payments under an operating lease shall be accounted into the relevant asset cost or
current profit or loss over the lease term on a straight-line basis.
31. Other Main Accounting Policies and Estimates
（1）Discontinued Operation
Discontinued operation refers to the components of an enterprise that meet one of the
following conditions and can be distinguished separately, and the component has been
disposed of or classified as holding for sale:
① This component represents an independent major business or a separate major area of
operation;
② This component is part of an associated plan to dispose of an independent major business
or a separate major area of operation;
③ This component is a subsidiary acquired specifically for resale.
For accounting method of Discontinued Operation, please refer to relevant description of
Notes 3.13 “Held-for-sale assets”.
32. Changes in Major Accounting Policies and Estimations
（1）Changes in Major Accounting Policies
①New income standards The Ministry of Finance promulgated the Accounting
Standards for BusinessEnterprises No.14-Income (Revised) in 2017 (hereinafter referred to as
the "New Income Standards"). The financial statements of the company in 2020 are prepared
in accordance with the new income standard. According to the relevant provisions of the new
income standard, the company adjusts the amount of retained earnings and other related items
in the financial statements at the beginning of 2020 for the cumulative impact of the first
implementation of the new income standard, and does not adjust the comparative financial
statement data. The impact of the implementation of the new income standard on the items of
61
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
statement at the beginning of the period is as follows:
Items in statement Book Value on 31st Dec 2019 Book Value on 1st Jan 2020
Assets
Contract assets
Inventories
Accounts receivable
Non current assets due within one
year
Long-term receivables
Other non-current assets
Liabilities
Contract liabilities 988,870.22
Advances from customers 1,117,423.35
Taxes payable
Non current liabilities due in one
year
Other current liabilities 128,553.13
Owners` Equity
Surplus reserves
Undistributed profits
Minority interest
Compared with the original income standard, the impact of the implementation of the
new income standard on the financial statements in 2020 is as follows:
A. Impact on consolidated balance sheet:
Items in statement New income standard Original income standard
Assets
Contract assets
Inventories
Accounts receivable
Non current assets due within one
year
Long-term receivables
Other non-current assets
Liabilities
62
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Items in statement New income standard Original income standard
Contract liabilities 1,479,711.62
Advances from customers 1,672,074.13
Taxes payable
Non current liabilities due in one
year
Other current liabilities 192,362.51
Owners` Equity
Surplus reserves
Undistributed profits
Minority interest
B. Impact on consolidated income statement:
Under the new income Under original income
standard standard
Items in statement
Amount incurred in the Amount incurred in the
current period current period
Operating income
Operating costs 638,523,642.92 634,708,154.65
Selling expenses 16,631,963.90 20,447,452.17
Total profits
Income tax expenses
Net profit
Comprehensive income
Basic earnings per share
(RMB/Share)
② Change of other accounting policies
Non.
(2). Change of accounting estimations
There were no changes of main accounting estimations during this period.
III.Taxation
1. Major tax types and tax rates applicable to the Company
Taxes Basis of tax assessment Tax rate %
63
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Value-added tax 13、9、6
Incomes should be taxed.
(VAT)
Levied based on the actual payment of business tax, VAT and 3
Education surcharges
consumption tax
Local education Levied based on the actual payment of business tax, VAT and 2
surcharges consumption tax
Urban maintenance Levied based on the actual payment of business tax, VAT and 7
and construction tax consumption tax
Enterprise income tax Levied based on the taxable income 15、25
Note：
（1）Chongqing Jianshe Automobile A/C Co., Ltd. by high and new technology enterprise
qualification on November 21, 2019, acquire the qualification of new high-tech enterprises,
Certificate No. GR201951100777, valid for three years. The company calculates and pay
enterprise income tax shall be levied at the reduced tax rate 15% from 2020 to 2022.
（2）The tax rebate for export of a company shall be exempted from deductions and the tax
rebate rate shall be 13%.
IV. Notes to the items of consolidated financial statements
1. Cash and cash equivalents
Items 2020.12.31 2019.12.31
Cash on hand 5,418.26
Bank deposits 79,304,835.29 9,390,326.10
Other monetary assets 80,032,987.92 145,223,408.84
Total 159,343,241.47 154,613,734.94
Including: Overseas deposits
Note:The closing balance of other monetary assets of the company is 80,032,987.92 Yuan,
including guarantee deposit of 40,032,987.92 Yuan and fixed deposit of 40,000,000.00 Yuan;
the opening balance is 145,223,408.84 yuan, including guarantee deposit of 145,223,408.84
Yuan. The above amount of other monetary assets is not regarded as cash and cash
equivalents due to restrictions on use.
2 Notes receivable
(1）Notes receivable：
64
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
2020.12.31
Items
Book Balance Bad debts Reserves Book value
Bank Acceptance 65,509,530.50 65,509,530.50
Trade Acceptance 1,039,000.00 1,039,000.00
Total 66,548,530.50 66,548,530.50
&
2019.12.31
Items
Book Balance Bad debts reserves Book value
Bank Acceptance 22,133,187.05 22,133,187.05
Trade Acceptance 1,279,713.13 1,279,713.13
Total 23,412,900.18 23,412,900.18
（2）Provision for bad debts：
For notes receivable, whether or not there is a material financing component, the company
will measure the loss in accordance with the estimated credit loss throughout the duration.
Band Acceptance
The company measured the loss in accordance with the expected credit loss throughout the
duration on December 31st 2020. All the bank`s acceptance bills would not bring credit risk to
the company even if there were default by banks or other drawers. So the company did not
withdraw the expected credit impairment loss on the bank acceptance bill.
Trade Acceptance
Bad Debt Reserves-single allotment amount on Dec 31st 2020,
Estimated credit
Bad debts
Book value loss rate during Reason
reserves
the period
Dongfeng Peugeot
High recovery
Citroen Automobile 1,309,000.00
probability
Company Co.,Ltd
65
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Total 1,309,000.00
（3）Pledged notes at the end of term：
There were no notes receivable pledged at end of term.
（4）The undue notes had been endorsed and discounted by end of term:
Amount confirmed Amount not confirmed
Items
at December 31, 2020 at December 31, 2020
Bank Acceptance 207,391,919.75
Total 207,391,919.75
Note: The acceptors of bank acceptance are commercial banks. The company regarded all
undue notes which had been endorsed or discounted as amount could be confirmed at end of
term, because of the commercial banks with high credit would pay the notes. However, if the
notes are not paid later, the company shall bear joint and responsibilities to the holders in
accordance with the Negotiable Instruments Law.
3. Accounts receivable
（1）Accounts receivable measured by amortized cost
2020.12.31 2019.12.31
Book Balance Bad debts Book value Book Balance Bad debts Book value
reserves reserves
Account
256,413,808.79 35,027,355.89 221,386,452.90 266,451,764.75 34,803,545.78 231,648,218.97
receivable
Total 256,413,808.79 35,027,355.89 221,386,452.90 266,451,764.75 34,803,545.78 231,648,218.97
（2）Bad debts reserves
No matter whether there is a significant financing component or not, the company count bad
debts reserves for account receivable according to the entire duration of the estimated credit
loss.
① Bad Debt Reserves-single allotment amount on Dec 31st 2020,
66
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Estimated credit
Bad debts
Book balance loss rate Reason
reserves
during the period
Chongqing Hyosow 12,723,992.31 100.00 12,723,992.31 Unable to recover
Auto parts Co., Ltd
Chongqing Bisuyunbo 5,396,775.35 100.00 5,396,775.35 Unable to recover
Technology Co., Ltd
Harbin Hafei Automobile 3,999,944.43 100.00 3,999,944.43 Unable to recover
Industry Group Co., Ltd
Chongqing Kaite Dynamic 1,481,654.59 100.00 1,481,654.59 Unable to recover
Technology Co., Ltd
Guangqi Jiao Automobile 75,821.20 100.00 75,821.20 Unable to recover
Co., Ltd Luqiao Branch
Guangqi Jiao Automobile 48,579.85 100.00 48,579.85 Unable to recover
Co.,Ltd Dongying Branch
Baic Yinxiang Automobile 20,700.00 100.00 20,700.00 Unable to recover
Co., Ltd
Hangzhou Fuyang 2,821,287.26 100.00 2,821,287.26 Unable to recover
Instrument Co., Ltd
Guangqi Jiao Automobile 67,998.51 100.00 67,998.51 Unable to recover
Co., Ltd
Hubei Zotye Automobile 1,408,811.40 100.00 1,408,811.40 Unable to recover
Co., Ltd
Baic black leopard (Weihai) 51,021.77 100.00 51,021.77 Unable to recover
Automobile Co., Ltd
Dongfeng Xiaokang Unable to recover
Automobile Co.,Ltd 102,720.66 100.00 102,720.66
Chongqing Branch
Sichuan Yema Automobile 12,157.93 100.00 12,157.93 Unable to recover
Co., Ltd
Total 28,211,465.26 28,211,465.26
②Balance of bad debts reserves：
Portfolio——Aging
Estimated credit
Book Balance loss rate during Bad debts reserves
the period
1-6 Months 214,500,075.50 -
6Months to 1 year 6,730,740.44 5.00 336,537.03
1 to 2 years 431,589.17 10.00 43,158.92
2 to 3 years 132,486.54 30.00 39,745.96
67
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
3 to 4 years 22,006.32 50.00 11,003.16
4 to 5 years
Over 5years 6,385,445.56 100.00 6,385,445.56
Total 228,202,343.53 6,815,890.63
③The changes of bad debts reserves:
Increase Reduce
Items 2020.01.01 Increased of 2020.12.31
Recovery or Elimination
Enterprise Provision
reversal or write-off
Combination
Bad debts 34,803,545.78 372,933.29 -60,654.61 88,468.57 35,027,355.89
Reserves
④Significant reversal or write-off of bad debt provision for the current period:
Amount of reversal or
Company Reason
write-off
Baic black leopard (Weihai) Automobile Co., Ltd Recovered
77,356.19
Yuxin Automobile Air Conditioning Co., Ltd Offset by debts
11,112.38
Total 88,468.57
Note: The amount above of bad debts reserves which was fully withdrawn according to the
independent provision for expected credit loss in the previous year, and in the current year, the
provision for bad debts was switched back by recovery or offset.
⑤Actual write-off amount of account receivable through the duration：
There were no accounts receivable actually write-off through the duration.
(3) Top five of account receivable classified by company：
The amount of top five account receivable classified by company throughout this duration is
199,470,492.71Yuan, accounting for 77.79% of the whole account receivable at end of term.
The provision of bad debts is 12,723,992.31 Yuan at the end of duration.
68
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Amount pf Proportion of total Amount of ending balance
Company Name Aging
ending balance accounts receivable % for bad debts
PSA Group 81,144,101.04 Within 6 months 31.65
Great Wall Motor
Co., Ltd.Chongqing 37,333,440.98 Within 6 months 14.56
Yongchuan Branch
Chongqing Changan 35,860,898.25 Within 6 months
Auto Co.,Ltd 13.99
Zhejiang Yuanjing 32,408,060.13 Within 6 months
Auto Co.,Ltd 12.64
Chongqing Huansu 12,723,992.31 Over 3years 12,723,992.31
Auto Co.,Ltd 4.95
Total 199,470,492.71 77.79 12,723,992.31
4．Prepayments
（1）Presentation of Prepayments by aging
2020.12.31 2019.12.31
Aging
Amount Proportion (%) Amount Proportion (%)
Within 1 year 8,133,267.52 95.24 9,776,475.47 97.02
1-2 years 176,700.00 2.07 217,616.19 2.16
2 to 3 years 169,785.97 1.99 59,562.67 0.59
Over 3 years 59,562.66 0.70 23,263.60 0.23
Total 8,539,316.15 100 10,076,917.93 100
（2）The top five prepayments by the debit balance as at December 31, 2020
Proportion Reason for
Company Name Relations with % of non-settle
Amount Aging
the Company total
prepaid accounts
Chongqing Jiantao accounts non-arrival
Non-related party 2,671,050.00 31.28 Within 1 year
Aluminum Co., Ltd settlement
Huayang（Shanghai）trade period
Non-related party 2,484,996.26 29.10 Within 1 year settlement
Co.,Ltd.
period
Chongqing Dongke Mould Non-related party 1,207,626.48 14.14 Within 1 year non-arrival
Manufacturing Co.,Ltd. settlement
Chongqing Quantian period
Electromechanical Non-related party 180,000.00 2.11 Within 1 year settlement
Equipment Co., Ltd period
Shanghai Yuanzhi Electric 178,000.00 2.08 non-arrival
Non-related party Within 1 year
Appliance Co., Ltd settlement
Total 6,721,672.74 78.71
69
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
5．Other receivables
Items 2020.12.31 2019.12.31
Interest receivable
Dividends receivable
Other receivables 1,253,612.91 3,439,028.39
Total 1,253,612.91 3,439,028.39
（1）Disclosure of other receivables by category
2020.12.31 2019.12.31
Book Provision for Book Value Book Provision for Book Value
Balance bad debts Balance bad debts
Other receivable
with significant
single amount and
provision for bad 2,364,944.99 2,364,944.99 886,074.92 886,074.92
debt made on an
individual basis
Other receivable
with provision for
bad debt made on a
portfolio with 5,379,862.00 4,126,249.09 1,253,612.91 7,564,888.30 4,125,859.91 3,439,028.39
similar risk credit
characteristics
basis
Total 7,744,806.99 6,491,194.08 1,253,612.91 8,450,963.22 5,011,934.83 3,439,028.39
① Provision for bad debts
A. Provision for bad debts of other accounts receivable at the first stage on December
31st 2020：
Estimated credit
loss in the next Provision for
Balance value Reason
bad debts
12months
Provision in groups:
70
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Group 1: aging 5,379,862.00 76.70 4,126,249.09
Group 2: Individually
determined
Others
Total 5,379,862.00 76.70 4,126,249.09
B. Provision for bad debts of other accounts receivable at the third stage on December
31st 2020：
Estimated credit
loss in the next Provision for
Balance value Reason
bad debts
12months
Single provision
Pending quality inspection,
163,394.48 100.00 163,394.48 Unable to recover
Exhibition products
Temporary supplier 390,655.08 100.00 390,655.08 Unable to recover
Chongqing Yiqun Trade
91,900.00 100.00 91,900.00 Unable to recover
Co.,Ltd
Deposit of workers` salary
from Chongqing Huachuang
88,000.00 100.00 88,000.00 Unable to recover
Tech Building construction
project
Chongqing Jinxiang Hoisting
Equipment Manufacturing 16,800.00 100.00 16,800.00 Unable to recover
Co.,Ltd
Yangzhou Qionghua Coating
56,500.00 100.00 56,500.00 Unable to recover
Equipment Co.,Ltd
China Customs (Chongqing) 78,825.36 100.00 78,825.36 Unable to recover
Chongqing Jianshe lijue Industrial
1,478,870.07 100.00 1,478,870.07 Unable to recover
Co., Ltd
Total 2,364,944.99 100.00 2,364,944.99
②The moving of provision for bad debts
First stage Second stage Third stage
Provision for bad Estimated Estimated credit
Estimated credit loss Total
debts credit loss in loss throughout the
throughout the
the next 12 duration (no credit
duration (credit loss)
months loss)
Balance value on Jan 4,125,859.91 886,074.92 5,011,934.83
1st 2020
In the Reporting
Period,carrying amount 4,125,859.91 886,074.92 5,011,934.83
of other receivables on
1 January 2020
71
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
First stage Second stage Third stage
Provision for bad Estimated Estimated credit
Estimated credit loss Total
debts credit loss in loss throughout the
throughout the
the next 12 duration (no credit
duration (credit loss)
months loss)
—transfer to the
first stage
—transfer to the
second stage
—transfer to the
third stage
Provision throughout -70,873.36 1,478,870.07 1,407,996.71
the duration
Reversal during the
period
Elimination during the
period
Write off during the
period
Others(Increased of 71,262.54 71,262.54
enterprise combination)
Balance value as at 4,126,249.09 2,364,944.99 6,491,194.08
Dec 31st 2020
Actual write-off amount of other receivable throughout the duration：
There were no other receivable actually write-off through the duration.
③Classification of other receivables:
Item 2020.12.31 2019.12.31
Petty cash, guarantee deposit, social security fee,
1,254,002.09 4,415,635.18
etc.
Bad debts have been fully charged for long-term
6,490,804.90 4,035,328.04
transactions
Total 7,744,806.99 8,450,963.22
④The top five other receivables by the debit balance as at December 31, 2020：
Whether Proportion % of Ending
it is Business Ending total other balance for
Company Name Aging receivables
related nature balance bad-debt
party provision
72
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Whether Proportion % of Ending
it is Business Ending total other balance for
Company Name Aging receivables
related nature balance bad-debt
party provision
Shenzhen Jianshe 3,013,664.00 Over
No Trading 38.91 3,013,664.00
motorcycle Co.,Ltd. 5years
Chongqing Jianshe Trading 1,478,870.07 Within 2
Lijue Industrial Co.,Ltd
Yes 19.09 1,478,870.07
years
Ningbo Jianshe Trading 329,628.73 Over
No 4.26 329,628.73
Motorcycle Co.,Ltd. 5years
Agency of Ningbo Trading 692,035.31 Over
No 8.94 692,035.31
Jianshe 5years
Temporary supplier Trading 390,655.08 Over
No 5.04 390,655.08
3years
Total — 5,904,853.19 76.24 5,904,853.19
6. Inventories
（1）Category of Inventory
2020.12.31
Item Provision for
Book balance inventory Book value
impairment
Raw materials 21,059,315.45 1,396.55 21,057,918.90
Goods in progress 6,915,376.31 210,319.10 6,705,057.21
Finished goods 141,445,525.10 3,387,974.33 138,057,550.77
Turnover materials 4,636,544.84 1,311,084.94 3,325,459.90
Supplies Inventory
Consumptive biological assets
The completed and unsettled
assets resulting from construction
contract
Total 174,056,761.70 4,910,774.92 169,145,986.78
&
2019.12.31
Item Provision for
Book balance inventory Book value
impairment
Raw materials 21,124,142.79 457,360.97 20,666,781.82
Goods in progress 7,124,606.32 220,231.20 6,904,375.12
73
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
2019.12.31
Item Provision for
Book balance inventory Book value
impairment
Finished goods 124,393,318.77 5,646,017.11 118,747,301.66
Turnover materials
Supplies Inventory
Consumptive biological assets
The completed and unsettled assets
resulting from construction contract
Total 152,642,067.88 6,323,609.28 146,318,458.60
（2）Provision for Inventory
Decrease in current
Increase in current period
period
Item 2020.01.01 2020.12.31
Switch back
Accrual Other Other
or write-off
Raw materials 457,360.97 455,964.42 1,396.55
Goods in progress 220,231.20 9,912.10 210,319.10
Finished goods 5,646,017.11 784,114.68 487,163.05 3,509,445.10 3,407,849.74
Turnover materials 48,857.68 1,242,351.85 1,291,209.53
Supplies Inventory
Consumptive biological
assets
The completed and
unsettled assets
resulting from
construction contract
Total 6,323,609.28 832,972.36 1,729,514.90 3,975,321.62 4,910,774.92
Note: The increased amount in current period of other refers to the amount of provision for
inventory withdrawn by Chongqing Pingshan TK Carburetor Co., Ltd. on the purchase day.
（3）Notes of provision for Inventory and the reasons for charging off or write-off
The reason for The Reason for writing
Details of provision for
Items switching back off provision for
inventory
provision for inventory inventory
Damaged very seriously,
Raw materials estimated net value is lower Sale or disposal
than its book cost.
Estimated net value is lower Sale or disposal
Goods in progress
than its book cost.
74
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
The reason for The Reason for writing
Details of provision for
Items switching back off provision for
inventory
provision for inventory inventory
Estimated net value is lower Sale or disposal
Finished goods
than its book cost.
7. Other current assets
Item 2020.12.31 2019.12.31
Overpaid VAT 3,396,186.56 3,047,932.61
Purchased debenture investment
falling due in a year which
measured at amortized cost
Purchased debenture investment
falling due in a year which
measured at fair value and changes
regarded as other consolidated
income
Total 3,396,186.56 3,047,932.61
8. Long-term equity investments
（1）Classification of Long-term equity investments
Increase in Decrease in current
Item 2020.01.01 2020.12.31
current period period
Investment on subsidiaries 0.00 0.00 0.00 0.00
Investment on joint 230,649,585.63 177,818.56 44,613,685.17 186,213,719.02
ventures
Investment on associate 0.00 0.00 0.00 0.00
company
Total 230,649,585.63 177,818.56 44,613,685.17 186,213,719.02
Less: provision for
impairment of long-term 0.00 0.00 0.00 0.00
equity investments
Total 230,649,585.63 177,818.56 44,613,685.17 186,213,719.02
（2）Details of Long-term equity investments
Increase/decrease in 2020 (+/-)
Profits and
Balance as at Other
losses on
Investee January 1, Decrease in investments Changes in
additional comprehe
2019 other
investment investment Recognized nsive
equity
under the income
equity method
75
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
一、Joint ventures
Chongqing Pingshan
TK Carburetor Co., 38,867,604.85 39,045,423.41 177,818.56
Ltd.
Chongqing Jianshe
191,781,980.78 -5,568,261.76
Hanon Co., Ltd
Total 230,649,585.63 -5,390,443.20
&
Increase/decrease in 2020 (+/-) Balance as at
December
Balance as at
Declaration of Preparing 31, 2020 of
Investee for December 31,
cash dividends Others provision
impairment 2020
or profits provision for
impairment
一、Joint ventures
Chongqing Pingshan
TK Carburetor Co., 0.00
Ltd.
Chongqing Jianshe
186,213,719.02
Hanon Co., Ltd
Total 186,213,719.02
9. Other non-current financial assets
Item 2020.12.31 2019.12.31
Financial assets which measured in
fair value and the changes regarded as
current period profit and loss
Specified financial assets which
measured in fair value and the
changes regarded as current period
profit and loss
Including: Investment on Ningbo 1,140,915.04 1,140,915.04
Jianshe Investment Company
Provision for impairment 1,140,915.04 1,140,915.04
Total
10. Investment properties
(1) Investment properties with cost measurement method
76
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
House、 Construction
Item Land use rights Total
Building in process
I. Original price
1. Opening balance 109,254,429.87 109,254,429.87
2.Increase in the current period
(1) Purchase
(2) Transferred from construction in
progress
(3) Increased of Enterprise Combination
3、Decreased amount of the period 72,445,590.49 72,445,590.49
（1）Disposal
（2）Other transfer 72,445,590.49 72,445,590.49
4、Closing balance 36,808,839.38 36,808,839.38
Ⅱ. Accumulated depreciation and
accumulated amortization
1、Opening balance 37,325,435.59 37,325,435.59
2、Increase in the current period 1,190,152.44 1,190,152.44
（1）Provision or amortization 1,190,152.44 1,190,152.44
（2）Transfer from fixed assets
3、Decreased amount of the period 24,750,147.17 24,750,147.17
（1）Disposal
（2）Other transfer 24,750,147.17 24,750,147.17
4、Balance at period-end 13,765,440.86 13,765,440.86
Ⅲ. Provisions for impairment
1、Opening balance
2、Increase in the current period
（1）Provision
3、Increase in the current period
（1）Disposal
（2）Other transfer
4、Balance at period-end
Ⅳ. Book value
1、Book value of the period-end 23,043,398.52 23,043,398.52
2、Book value of the period-begin 71,928,994.28 71,928,994.28
Note：In this period of investment properties, leasing value of housing buildings decreased
77
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
72,445,590.49 Yuan, and it moved from investment properties to fixed assets.
11. Fixed assets
Item 2020.12.31 2019.12.31
Fixed assets 310,131,438.69 278,885,442.43
Fixed assets to be disposed of
Total 310,131,438.69 278,885,442.43
（1）Fixed assets and accumulated depreciation
① Fixed assets situation
House, Machinery Transportatio Other
Item Total
Building equipment ns equipment
Ⅰ、Original price
1、Opening balance 109,345,310.69 589,170,440.09 6,418,034.14 15,139,805.36 720,073,590.28
2、Increase in the current 108,824,878.13 122,461,803.30 1,181,786.85 4,216,918.86 236,685,387.14
period
（1）Purchase 5,823,458.95 243,805.32 952,103.97 7,019,368.24
（2）Transferred from 73,280,446.47 3,393,496.06 76,673,942.53
construction in progress
（3） Increased of 35,544,431.66 113,244,848.29 937,981.53 3,264,814.89 152,992,076.37
Enterprise Combination
（4） others
3、Decreased amount of the 83,929,749.53 1,456,858.00 15,800.10 85,402,407.63
period
（1）Disposal 83,929,749.53 1,456,858.00 15,800.10 85,402,407.63
（2）Decreased of
Enterprise Combination
（3）Transferred to
investment properties
4、Closing balance 218,170,188.82 627,702,493.86 6,142,962.99 19,340,924.12 871,356,569.79
Ⅱ、Accumulated
depreciation
1、Balance at 34,479,897.75 366,630,737.32 5,878,987.43 13,133,498.42 420,123,120.92
period-beginning
2、Increase in the current 60,359,471.20 124,163,794.11 1,025,130.59 4,460,587.65 190,008,983.55
period
（1）Provision 6,624,940.79 24,273,477.77 134,048.14 1,559,011.19 32,591,477.89
（2）Increased of 28,984,383.24 99,890,316.34 891,082.45 2,901,576.46 132,667,358.49
Enterprise Combination
（3）Transferred from 24,750,147.17 24,750,147.17
construction in progress
78
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
House, Machinery Transportatio Other
Item Total
Building equipment ns equipment
（4）Others
3、Decrease in the current 61,843,270.63 1,413,152.85 11,145.98 63,267,569.46
period
（1）Disposal 61,843,270.63 1,413,152.85 11,145.98 63,267,569.46
（2）Decreased of
Enterprise Combination
（3）Transferred to
investment properties
4、Balance at period-end 94,839,368.95 428,951,260.80 5,490,965.17 17,582,940.09 546,864,535.01
Ⅲ、Provisions for
impairment
1、Balance at 21,065,026.93 21,065,026.93
period-beginning
2、Increase in the current 11,127,363.40 11,127,363.40
period
（1）Provision 10,603,959.77 10,603,959.77
（2）Increased of 523,403.63 523,403.63
Enterprise Combination
3、Decrease in the current 17,831,794.24 17,831,794.24
period
（1）Disposal 17,831,794.24 17,831,794.24
（2）Decrease of Enterprise
Combination
4、Balance at period-end 14,360,596.09 14,360,596.09
Ⅳ、Book Value
1、Book Value of 123,330,819.87 184,390,636.97 651,997.82 1,757,984.03 310,131,438.69
period-end
2、Book Value of 74,865,412.94 201,474,675.84 539,046.71 2,006,306.94 278,885,442.43
period-begin
Note: As at December 31, 2020, the company didn’t occur the situation of leasing fixed assets through financial
lease method.
The original value of 72,445,590.49 Yuan of housing buildings are converted from investment properties to
fixed assets, which caused roll-in corresponding accumulated depreciation of 24,750,147.17 Yuan.
12. Construction in progress
Item 2020.12.31 2019.12.31
Construction in progress 1,871,241.59 3,858,269.05
Material holds for construction of fixed
assets
Total 1,871,241.59 3,858,269.05
（1）Information of construction in progress
79
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
2020.12.31 2019.12.31
Item Provisions Provisions
Book balance for Book value Book balance for Book value
impairment impairment
Lighting protection
testing fee of 615,980.77 615,980.77 3,284,565.72 3,284,565.72
technique building
No.5 assembly line
information analyzing 461,185.83 461,185.83 230,592.92 230,592.92
system
New energy
production line design 66,037.74 66,037.74 66,037.74 66,037.74
fee
Intelligent
transformation of
suspended vane 301,886.79 301,886.79
compressor production
line
Mould 426,150.46 426,150.46
Total quality
management system 176,724.00 176,724.00
platform
implementation
Update of Linotype 73,800.00 73,800.00
OA Updating 26,548.67 26,548.67
Total 1,871,241.59 1,871,241.59 3,858,269.05 3,858,269.05
（2）Changes of important construction in progress during the period
Budget Source of Paid accounting for the Progress of
Progress name
fund budget % project %
New energy production line 48,600.00 Self-funding 100.00 100.00
design fee
Reformation of multi head drill Self-funding
73,800.00 100.00 100.00
of caster
Self-funding
OA Updating 26,548.67 74.18 74.18
Renovation project of science Self-funding
and technology complex 4,427,877.00
100.00 100.00
building
Self-funding
Total quality management 836,283.19 61.47 61.47
system platform implementation
80
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Budget Source of Paid accounting for the Progress of
Progress name
fund budget % project %
No.5 assembly line information Self-funding
750,265.49 94.34 94.34
analyzing system
Intelligent transformation of Self-funding
suspended vane compressor 320,000.00
66.55 66.55
production line
Mould 1,207,161.37 Self-funding 100.00 100.00
monitoring system 13,486.24 Self-funding 100.00 100.00
Air flow meter 42,643.37 Self-funding 100.00 100.00
CNC lathe 28,141.59 Self-funding 100.00 100.00
Self-funding
Vertical band sawing machine 13,180.00
100.00 100.00
Exhaust system 91,858.41 Self-funding 100.00 100.00
&
Increase in the period Decrease in the period 2020.12.31
2020.1.1
Process Includin
name g: Other Including:
Transfer to fixed
Beginning Amount capitaliz decreas Closing balance capitalizatio
assets
balance ation of e n of interest
interest
New energy
production 66,037.74
66,037.74
line design
fee
Reformation
of multi head 73,800.00
73,800.00
drill of
caster
OA Updating 26,548.67
26,548.67
Renovation
project of
science and 2,671,553.23 615,980.77
3,284,565.72 2,968.28
technology
complex
building
Total quality
management
system 889,931.54
176,724.00 713,207.54
platform
implementati
on
No.5
assembly line 461,185.83
230,592.92 230,592.91
information
analyzing
Intelligent
system
transformati 301,886.79
301,886.79
on of
suspended 81
vane
compressor
production
line
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Mould 803,359.45
377,208.99 426,150.46
monitoring 13,486.24
system 13,486.24
Air flow 42,643.37
meter 42,643.37
CNC lathe 28,141.59
28,141.59
Vertical
band sawing 13,180.00
13,180.00
machine
Exhaust 91,858.41
system 91,858.41
3,858,269.
Total 05
2,241,324.58 4,228,352.04 1,871,241.59
13. Intangible assets
Software Non-patente
Item Land use Patent right d Total
technology
Ⅰ、Original book value
1、Opening balance 32,933,611.45 32,933,611.45
2、Increase in the current period 9,192,796.84 1,880,957.69 2,691,549.96 13,765,304.49
（1）Purchase 889,931.54 889,931.54
（2）Internal R & D
（3）Increased of Enterprise
9,192,796.84 991,026.15 2,691,549.96 12,875,372.95
Combination
（4）Others
3、Decrease in the current period
（1）Disposal
（2）Decrease of Enterprise
Combination
4、Closing balance 42,126,408.29 1,880,957.69 2,691,549.96 46,698,915.94
Ⅱ、Accumulated amortization
1、Balance at period-begin 10,110,226.74 10,110,226.74
2、Increase in the current period 8,081,197.47 965,108.29 158,326.47 9,204,632.23
（1）amortization 811,731.19 34,491.39 158,326.47 1,004,549.05
（2）Increase of enterprise combination 7,269,466.28 930,616.90 8,200,083.18
（2）Others
3、Decrease in the current period
82
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Software Non-patente
Item Land use Patent right d Total
technology
（1）Disposal
（2）Decrease of enterprise
combination
4、Balance at period-end 18,191,424.21 965,108.29 158,326.47 19,314,858.97
Ⅲ、Provisions for Impairment
1、Balance at period-begin
2、Increase in the current period
（1）Provision
3、Decrease in the current period
（1）Disposal
4、Balance at period-end
Ⅳ、Book Value
1、Book Value of period-end 23,934,984.08 915,849.40 2,533,223.49 27,384,056.97
2、Book Value of period-begin 22,823,384.71 22,823,384.71
14. Long-term amortization expenses
Other
Increase in Amortization Decrease Reason for
Item 2020.01.01 the current in the current in the 2020.12.31 other
period period current decrease
period
SlidDworks
74,250.00 49,500.00 24,750.00
service charge
Total 74,250.00 49,500.00 24,750.00
15. Deferred income tax assets and deferred income tax liability
（1）Deferred income tax assets not wrote off
2020.12.31 2019.12.31
Item Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
differences differences
Provisions for
impairment in 5,177,039.68 34,306,803.21 5,112,390.59 34,082,603.92
credit
Provisions for
1,097,038.44 5,955,882.88 948,541.39 6,323,609.28
impairment in
83
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
assets
Total 6,274,078.12 40,262,686.09 6,060,931.98 40,406,213.20
（2）Deferred income tax liability not wrote off
2020.12.31 2019.12.31
Taxable
Item Taxable
Deferred income temporary Deferred income
temporary
tax liability differences tax liability
differences
Estimated added
value of assets
not
under the same 1,520,765.13 6,083,060.52
control
Tax deduction
for depreciation 387,786.38 1,551,145.52
of fixed assets
Total 1,908,551.51 7,634,206.04
（2）Details of the un-recognized deferred income tax assets
Item 2020.12.31 2019.12.31
Deductible temporary differences 21,668,149.93 27,938,818.66
Tax deductible losses 190,208,959.14 131,814,476.54
Total 211,877,109.07 159,753,295.20
Note: Because the amount of taxable income is uncertain in the future, the Company's
deductible temporary differences and deductible losses weren’t recognized as deferred income
tax assets.
(2) Deductible losses of unrecognized deferred income tax assets shall be due in the following
years:
Year 2020.12.31 2019.12.31 Notes
2020 7,561,009.01
2021 1,176,802.39 1,176,802.39
2022
2023 850,355.91 850,355.91
2024 145,565,134.28 122,226,309.23
2025 42,616,666.56
84
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Total 190,208,959.14 131,814,476.54
16. Other non-current assets
Item 2020.12.31 2019.12.31
Prepayment of long - term assets 2,141,443.59 3,383,556.88
Total 2,141,443.59 3,383,556.88
17. Short-term borrowings
（1）Classification of short-term borrowings
Item 2020.12.31 2019.12.31
Credit borrowings 170,410,000.00 40,000,000.00
Guaranteed borrowings 383,500,000.00 382,280,000.00
Mortgaged borrowings
Pledge loan
Total 553,910,000.00 422,280,000.00
Notes：
Annual
Starting Terminati Ending
lending institution interest Guarantor
date on date balance
rate
Finance company of China
2020/12/11 2021/3/11 4.35 % Credit borrowings 25,000,000.00
South Industries Group
Finance company of China
2020/6/15 2021/6/15 3.92% Credit borrowings
South Industries Group 20,000,000.00
Finance company of China
2020/11/17 2021/11/17 3.92% Credit borrowings
South Industries Group 30,000,000.00
Finance company of China
2020/12/2 2021/12/2 4.35% Credit borrowings
South Industries Group 28,000,000.00
Finance company of China
2020/12/2 2021/12/2 4.35% Credit borrowings
South Industries Group 30,000,000.00
Finance company of China
2020/12/29 2021/12/29 4.35% Credit borrowings
South Industries Group 23,500,000.00
Finance company of China
2020/7/31 2021/7/31 2.00% Credit borrowings 9,400,000.00
South Industries Group
Finance company of China
2020/10/29 2021/10/29 2.00% Credit borrowings 4,510,000.00
South Industries Group
Business department of Chongqing Jianshe
Chongqing rural 2020/1/17 2021/1/16 Vehicle System
commercial bank 4.79% Co.,Ltd. 17,710,000.00
Business department of Chongqing Jianshe
Chongqing rural 2020/6/19 2021/6/18 Vehicle System
commercial bank 4.57% Co.,Ltd. 30,000,000.00
Business department of 2020/7/29 2021/7/28 4.57% Chongqing Jianshe
85
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing rural Vehicle System 30,000,000.00
commercial bank Co.,Ltd.
Business department of Chongqing Jianshe
Chongqing rural 2020/8/11 2021/8/10 Vehicle System
commercial bank 4.57% Co.,Ltd. 30,000,000.00
Business department of Chongqing Jianshe
Chongqing rural 2020/12/4 2021/12/3 Vehicle System
commercial bank 4.57% Co.,Ltd. 55,790,000.00
High tech Development Chongqing Jianshe
Zone sub branch of Bank 2020/4/13 2021/4/12 Vehicle System
of Chongqing Co., Ltd 4.60% Co.,Ltd. 24,997,000.00
High tech Development Chongqing Jianshe
Zone sub branch of Bank 2020/4/20 2021/4/19 Vehicle System
of Chongqing Co., Ltd 4.60% Co.,Ltd. 9,999,500.00
Chongqing Jianshe
Jiulongpo branch of
2020/4/28 2021/4/27 Vehicle System
Chongqing Bank
4.60% Co.,Ltd. 25,013,500.00
Jiulongpo branch of Chongqing Jianshe
Chongqing Bank 2020/10/12 2021/5/24 Vehicle System
4.60% Co.,Ltd. 34,500,000.00
Jiulongpo branch of Chongqing Jianshe
Chongqing Bank 2020/10/15 2021/5/24 Vehicle System
4.60% Co.,Ltd. 20,000,000.00
Jiulongpo branch of Chongqing Jianshe
Chongqing Bank 2020/10/19 2021/5/24 Vehicle System
4.60% Co.,Ltd. 25,490,000.00
Chongqing Branch of Chongqing Jianshe
China Everbright Bank 2020/8/27 2021/8/27 Vehicle System 10,000,000.00
Co., Ltd 4.35% Co.,Ltd.
Chongqing Branch of Chongqing Jianshe
Bank of Communications 2020/11/3 2021/5/18 Vehicle System 20,000,000.00
Co., Ltd 4.79% Co.,Ltd.
Chongqing Jianshe
Chongqing Jiulongpo
2020/2/28 2021/2/27 Vehicle System 50,000,000.00
branch of Bank of China
4.79% Co.,Ltd.
18. Notes payable
Item 2020.12.31 2019.12.31
Bank Acceptance 110,020,000.00 330,644,075.95
Trade Acceptance
Total 110,020,000.00 330,644,075.95
19. Accounts payable
(1) Presentation of Accounts payable
Aging 2020.12.31 2019.12.31
Within 1 year 284,998,378.45 221,641,634.09
1-2 years 1,837,069.84 904,967.54
86
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
2-3 years 0.08 741,395.71
Over 3 years 1,967,798.70 1,905,168.46
Total 288,803,247.07 225,193,165.80
(2) Significant accounts payable for over 1 year.
Reason for unreimbursed or
Item Ending balance
transferred
Sima Measurement and Control Technology
722,005.51 Pay by Installments
Co., Ltd.
Beijing Langde Technology Co., Ltd 76,685.41 Pay by Installments
Shanghai zuozhu cooling and heating control
183,310.67 Pay by Installments
technology Co., Ltd
Chongqing Huachuang Construction
143,206.56 Pay by Installments
Engineering Co., Ltd
Chongqing mechanical and electrical design and
375,000.00 Pay by Installments
Research Institute
Total 1,500,208.15
20. Advances from customers
Item 2020.12.31 2019.12.31
Within 1 year 617,356.43
Over 1 year 500,066.92
Total 1,117,423.35
21. Contract liabilities
Item 2020.12.31 2019.12.31
Contract liabilities 1,479,711.62
Less: contract liabilities
that are included in
non-current liabilities
Total 1,479,711.62
&
Item 2020.12.31 2019.12.31
Advance for manufactured 1,479,711.62
products
Total 1,479,711.62
22. Payroll Payable
87
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（1）Presentation of Payroll Payable
Increase in the Decrease in the
Item Beginning balance Ending balance
current period current period
Short-term remuneration 7,062,623.37 93,540,056.86 91,800,517.80 8,802,162.43
Post-employment benefits -
2,616,505.78 7,403,894.12 2,944,364.45 7,076,035.45
defined contribution plans
Dismissal welfare 5,200,000.00 10,154,822.87 2,805,617.91 12,549,204.96
Others
Total 14,879,129.15 111,098,773.85 97,550,500.16 28,427,402.84
（2）Presentation of short-term compensation
Increase in the Decrease in the
Item Beginning balance Ending balance
current period current period
1、Salary, bonus, allowance and
4,849,754.18 65,915,439.89 65,590,430.19 5,174,763.88
subsidy
2、Employee benefits 7,421,692.25 6,323,746.95 1,097,945.30
3、Social insurance expenses 643,179.85 9,463,498.50 8,659,693.94 1,446,984.41
Including: medical insurance 582,652.93 9,101,797.73 8,540,157.40 1,144,293.26
premium
Work-related injury insurance 43,768.51 361,700.77 119,536.54 285,932.74
premium
Maternity insurance premium 16,758.41 16,758.41
Others
4、Housing fund 1,102,016.46 8,548,102.00 9,269,913.00 380,205.46
5、Labor union expenditures and
467,672.88 2,066,165.22 1,831,574.72 702,263.38
employee education expenses
6、Short-term absence
with payment
7、Short-term profit
sharing plan
8、Others 125,159.00 125,159.00
Total 7,062,623.37 93,540,056.86 91,800,517.80 8,802,162.43
（3）Presentation of defined contribution plans
beginning Increase in the Decrease in the
Item Ending balance
balance current period current period
Basic endowment 2,428,894.97 7,196,340.16 2,846,988.16 6,778,246.97
insurance premium
Unemployment insurance
187,610.81 207,553.96 97,376.29 297,788.48
premium
Enterprise Annuity
Total 2,616,505.78 7,403,894.12 2,944,364.45 7,076,035.45
88
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
23. Taxes and surcharges payable
Tax and surcharge items 2020.12.31 2019.12.31
Value-added tax (VAT) 23,721.14 127,475.04
Corporate income tax 2,762,007.64 2,336,225.75
Individual income tax 565,599.19 518,449.47
Urban maintenance and construction tax 3,132,397.23 3,157,180.70
property tax 3,727,900.64 3,727,900.64
Land royalties 1,808,215.20 1,808,215.20
Educational surtax 2,000,119.16 2,002,490.72
Other taxes and surcharges 4,086,656.73 4,095,434.65
Total 18,106,616.93 17,773,372.17
24. Other payable
Item 2020.12.31 2019.12.31
Interest payable
Dividend payable
Other payable 10,260,888.23 6,087,459.55
Total 10,260,888.23 6,087,459.55
（1）Other payable
① Presentation of other payable in accordance with the nature of the payment.
Item 2020.12.31 2019.12.31
Cash deposit 1,426,426.77 1,285,000.00
Reimbursement for occupational injury 216,487.83 274,963.48
Testing cost 1,670,056.33 1,503,733.23
Party organization funds 541,589.50
Design cost and Others 6,406,327.80 3,023,762.84
Total 10,260,888.23 6,087,459.55
② Significant other payable for over 1 year
Item Ending balance Reason for unreimbursed or transferred
Chongqing Xingsu Logistics Co., Ltd 300,000.00 Undue deposit
89
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Chongqing Shapingba District Ruihe 100,000.00
loading and unloading transportation Undue deposit
department
Chongqing Chengbei Logistics Co., 50,000.00 Undue deposit
Ltd
Chongqing Huangdao automobile 50,000.00 Undue deposit
transportation Co., Ltd
Chongqing Bangbao Auto Parts Co., 30,000.00 Undue deposit
Ltd
Total 530,000.00
25. Other current liabilities
Item 2020.12.31 2019.12.31
Taxes to be written off 192,362.51
Total 192,362.51
26. Share capital
Increase in Decrease in
Item 2020.01.01 the current the current 2020.12.31
period period
Total shares 119,375,000.00 119,375,000.00
Total 119,375,000.00 119,375,000.00
27. Capital reserve
Increase in the Decrease in the
Item 2020.01.01 2020.12.31
current period current period
Capital (or equity) premium 702,032,741.07 702,032,741.07
Other capital reserves 256,532,553.22 256,532,553.22
Total 958,565,294.29 958,565,294.29
90
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
28. Other comprehensive income
Reporting Period
Less: recorded
in other
comprehensive
Attributable to Attributable to
Item 2020.01.01 Income before income in prior Less: 2020.12.31
owners of the non-controlling
taxation in the period and Income tax
Company as the interests after
Current Period transferred in expense
parent after tax tax
profit or loss in
the Current
Period
I. Items that will not be reclassified to
9,800.00 9,800.00
profit or loss
Of which: Re-measurement of changes in
net liabilities or net assets of a defined
benefit plan
Share of other combined income of
invested units that cannot be reclassified 9,800.00 9,800.00
into profit or loss under the equity method
II. Items that may subsequently be
reclassified to profit or loss
Of which: Share of other comprehensive
income of investees that will be
reclassified into profit or loss under equity
method
Gain/Loss on changes in fair value of
available -for- sale financial assets
Investments held to maturity reclassified as
gains or losses on marketable financial
assets
Effective portion of cash flow hedging
gains and losses
91
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Reporting Period
Less: recorded
in other
comprehensive
Attributable to Attributable to
Item 2020.01.01 Income before income in prior Less: 2020.12.31
owners of the non-controlling
taxation in the period and Income tax
Company as the interests after
Current Period transferred in expense
parent after tax tax
profit or loss in
the Current
Period
Translation difference in foreign currency
financial statements
Total of other comprehensive income 9,800.00 9,800.00
92
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
29. Surplus reserves
Increase in the Decrease in the
Item 2020.01.01 2020.12.31
current period current period
Statutory Surplus
56,724,000.00 56,724,000.00
reserve
Discretionary
68,962,000.00 68,962,000.00
Surplus reserves
reserve fund
enterprise
development fund
Total 125,686,000.00 125,686,000.00
30. Retained Earnings
Item Amount To extract or distribute
the proportion.
Adjustments to Retained Earnings as at December 31, 2019 -1,031,463,363.68
Adjustments to total Retained Earnings as at January 1,
2020 ("+" for increases; "-" for decreases)
Adjusted Retained Earnings as at January 1, 2020 -1,031,463,363.68
Add: net profit attributable to owners of parent company in
1,415,942.45
2020
Less：Extraction of statutory Surplus reserve
Extraction of discretionary Surplus reserve
Extraction of General risk reserve
Dividends payable to ordinary shares
Ordinary dividend dividends transferred to capital stock
Retained Earnings as at December 31, 2019 -1,030,047,421.23
31. Operating income and operating costs
（1）The operating income and cost are listed below：
Year 2020 Year 2019
Item
Operating income Operating cost Operating income Operating cost
Primary businesses 731,571,361.31 634,912,358.18 781,194,636.87 706,078,543.97
Other businesses 9,280,483.94 3,611,284.74 10,292,797.31 3,309,616.17
Total 740,851,845.25 638,523,642.92 791,487,434.18 709,388,160.14
93
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（2）Primary businesses (by business)：
Year 2020 Year 2019
Name of product
Operating income Operating cost Operating income Operating cost
Motorcycle and
731,571,361.31 634,912,358.18 781,194,636.87 706,078,543.97
auto parts
Total 731,571,361.31 634,912,358.18 781,194,636.87 706,078,543.97
（3）Primary businesses (by product)：
Year 2019 Year 2018
Name of product
Operating income Operating cost Operating income Operating cost
Motorcycle and
731,571,361.31 634,912,358.18 781,194,636.87 706,078,543.97
auto parts
Total 731,571,361.31 634,912,358.18 781,194,636.87 706,078,543.97
（4）The operating income and costs (by region) are as follows:
Year 2020 Year 2019
Area name
Operating income Operating cost Operating income Operating cost
Anhui Province 17,404,019.16 11,550,377.56 5,648,549.94 4,593,780.11
Beijing 8,737,415.97 6,191,546.78 229,982.31 199,708.79
Fujian Province 92,194.69 67,860.82 109,902.71 99,130.70
Guangdong Province 4,965,172.47 3,393,904.49 4,807,767.16 4,027,126.82
Guangxi Province 2,143,214.13 1,454,238.87 905,058.02 752,546.27
Abroad 226,077,561.82 214,634,628.96 296,791,807.47 276,760,742.25
Hebei Province 3,295,014.18 2,215,103.44 29,663,462.04 24,436,846.58
Henan Province 4,894,181.39 3,365,463.80 3,982,620.62 3,355,988.02
Hubei Province 30,883,712.83 20,430,654.16 60,349,900.80 48,923,320.94
Jilin Province 65,486.74 24,681.74 14,018.93 11,720.42
Jiangsu Province 9,232,764.33 6,215,398.79 12,008,002.96 9,905,915.91
Jiangxi Province 6,328,746.31 4,416,835.33 4,425,642.72 3,784,917.99
Liaoning Province 121,822.84 106,330.79
Shandong Province 1,955,016.56 1,421,099.96 2,198,370.17 1,958,220.59
Shaanxi Province 505,176.97 359,785.11 178,424.79 155,718.94
Shanghai Province 4,099,161.46 2,806,999.93 2,634,774.33 2,210,942.27
Sichuan Province 113,828.80 78,986.59 72,993.30 62,068.44
94
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Tianjin 2,704,426.60 1,835,873.80 24,788,007.09 20,620,340.87
Yunnan Province 40,912.43 33,946.99 109,507.58 90,863.64
Zhejiang Province 96,149,564.48 67,278,049.97 84,222,867.72 72,217,541.67
Chongqing 311,883,789.99 287,136,921.09 247,856,310.61 231,739,961.82
Ningxia Province 40,460.18 35,849.30
Shanxi Province
Hunan Province 17,072.84 14,143.75
Xinjiang Province 17,309.74 14,817.09
Total 731,571,361.31 634,912,358.18 781,194,636.87 706,078,543.97
（5）The operating revenue is listed as follows according to the revenue recognition time:
Motorcycle and auto Engineering Others
Item Services Total
parts construction
Revenue is recognized in a
certain period of time
Revenue is recognized at a
740,851,845.25 740,851,845.25
certain point in time
Total 740,851,845.25 740,851,845.25
（6）Information related to performance obligations:
The company's revenue recognition policy is detailed in note 2, 26. According to the contract, the
company delivers the goods to the agreed place or the third-party logistics company. Each month,
the customer issues a notice of account according to the actual consumption of the production. The
sales clerk issues an invoice according to the customer's notice of account, combined with the
customer's consumption, contract unit price, notice of account, etc. As the time point of control
transfer, the sales revenue is recognized. The credit period given by the company to customers is
determined according to the credit risk of customers, and there is no significant financing
component.
（7）Information related to transaction value assigned to residual performance obligations:
The amount of revenue corresponding to performance obligations of contracts signed but not
performed or not fully performed yet was RMB1,479,711.62 at the period-end, among which
RMB1,479,711.62 was expected to be recognized in 2021.
95
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
32. Taxes and surcharges
Item Year 2020 Year 2019
Urban maintenance and construction tax 1,297,889.65 2,201,754.91
Educational surtax 942,394.93 1,556,045.07
Property tax 1,362,504.39 1,508,771.51
Tenure tax 1,266,056.40 1,572,683.20
vehicle ship royalties 8,280.00 6,660.00
Stamp duty 556,229.80 636,880.40
Other 9,236.37 2,701.04
Total 5,442,591.54 7,485,496.13
33. Selling expenses
Item Year 2020 Year 2019
Payroll Payable 6,908,470.17 7,470,639.56
Depreciation costs 45,737.88 52,026.32
Office expenses 72,913.22 97,433.00
Transportation cost 3,727,187.12
Insurance expenses 15,207.32 17,355.68
Exhibition fees 178,430.05 39,725.27
Advertising expenses 115,226.42 51,250.98
Travel expenses 737,314.20 1,252,942.75
Consignment expenses 499,920.18 328,852.98
Sales service charge 1,225,779.95 1,098,339.02
Losses of sample 223.00
Repair cost 4,851,678.62 8,324,542.15
Storage and storage fee 1,463,359.49 1,514,357.09
Others 517,926.40 672,441.16
Total 16,631,963.90 24,647,316.08
34. General and administrative expenses
Item Year 2020 Year 2019
Payroll Payable 36,780,276.53 53,009,855.67
Depreciation costs 8,812,391.54 5,856,474.30
Repair charges 7,655,837.85 16,628,589.88
Consulting fee 244,683.58 651,727.75
Office expenses 719,571.66 964,526.19
96
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Agency fee 993,241.03 707,452.22
Travel expenses 397,741.18 841,355.01
Amortization of intangible assets 999,818.65 657,864.72
Conference fees 381,923.64 452,673.18
Business entertainment 356,627.75 516,787.06
Sewage charge 1,905,796.86 1,453,147.03
Legal fare 268,795.70
Others 10,163,006.52 10,580,936.51
Total 69,410,916.79 92,590,185.22
35. Research and development expense
Item Year 2020 Year 2019
Salary 9,107,110.70 8,449,151.44
Office expenses 33,652.71 29,044.7
Material cost 939,353.55 856,689.18
Travel expenses 258,984.60 497,508.19
Tooling fee 1,447,144.25 669,651.92
Conference-servicing expenses 21,458.72 4,644.66
Fees for evaluation, identification and 67,882.49 9,343.40
authentication
Software fee 76,629.13 59,648.00
Trademark, property right, patent fee 344,460.22 104,668.29
Test inspection fee 52,689.54 521,886.44
Repair cost 278,601.44 109,838.83
Sample fee 132,109.49 78,570.89
Business entertainment 36,811.00 43,451.54
Traffic expense 7,823.79
Depreciation expense 2,011,654.48 1,876,336.67
Consulting fee 5,445.45 42,000.00
Others 462,154.13 878,680.21
Total 15,283,965.69 14,231,114.36
36. Financial expenses
Item Year 2020 Year 2019
97
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Interest expenses 22,798,392.28 12,939,583.98
Less: Interest income 1,572,349.92 3,068,137.48
discount rate of bill 921,233.95 10,786,871.75
63,984.65
Exchange gains and losses
87,868.32
Less: gains of exchange
4,538.06
Cash discount 31,258.10 -310,138.31
Commission Charge and others 224,509.17 882,881.59
Total 22,486,373.84 21,295,046.18
37. Other income
Item Year 2020 Year 2019
Government subsidy 4,449,659.88 1,057,774.93
Commission for withholding and
paying individual income tax
Others
Total 4,449,659.88 1,057,774.93
Government subsidy regarded as other income during the period:
Item Year 2020 Year 2019
Related to assets
Related to profits: 4,449,659.88 1,057,774.93
Government subsidy 4,449,659.88 1,057,774.93
Total 4,449,659.88 1,057,774.93
Details of government subsidy
Item Year 2020 Year 2019
Emergency supply subsidy of Chongqing Banan District treasury
100,000.00
payment center
Obtained subsidy for staff stability of Chongqing Jiulongpo District
3,048,959.00
Employment and talent center
Subsidy for talent introduction in 2020 400,000.00
Reward from Jiulong Park Finance Office of Chongqing hi tech
45,000.00
Industrial Development Zone
98
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Obtained subsidy for international service trade from Jiulongpo
10,000.00
District Finance Bureau of Chongqing Jiulongpo District Commerce
Committee
Received patent subsidy from Chongqing Jiulongpo District market
23,200.00
supervision and Administration Bureau
Received subsidies for recruitment of key enterprises from
54,200.00
Chongqing Jiulongpo District Finance Bureau
Received quality management award funds from Chongqing 300,000.00
Jiulongpo District market supervision and Administration Bureau
Received science and technology project subsidy from Chongqing
100,000.00
Jiulongpo Finance Bureau
Obtained patent subsidy fee of Chongqing Intellectual Property
6,000.00
Office in 2019
Received the first batch of special project funds for technological
200,000.00
innovation of Chongqing Municipal Bureau in 2020
Received patent subsidy from Chongqing Jiulongpo District market
32,200.00
supervision and Administration Bureau
Received subsidies for motorcycle EFI project of Banan District
100,000.00
treasury payment center
Received the second industry and information technology fund of
400,000.00
2019 from Chongqing Jiulongpo Finance Bureau's
Received the fund of Science and Technology Committee
200,000.00
development and application project
Received R&D fund of 2019 from Chongqing Jiulongpo Finance
190,000.00
Bureau
Received new product research fund of 2018 from Chongqing
150,000.00
JiulongpoFinance Bureau's
Received research fund of estimate automobile air-conditioner energy 50,000.00
consumption
Received Internet communication fee from Chongqing Jiulongpo 38,700.00
Finance Bureau
Third generation service fee 30,100.88 6,274.93
Patent consulting fee from Chongqing Intellectual Property Office 6,000.00
Important hiring subsidies from Chongqing Jiulongpo Finance 1,100.00
Bureau
Hiring subsidies from Chongqing Jiulongpo Employment and
15,700.00
personal services Bureau
Total 4,449,659.88 1,057,774.93
38. Investment income
item Year 2020 Year 2019
Long-term equity investment income calculated by
-5,390,443.20 -27,108,151.12
equity method
Investment income from 50% equity of Chongqing
Pingshan TK Carburetor Co., Ltd. remeasured according 1,939,381.08
to the fair value on the purchase day
Disposal of a long-term equity investment of investment
returns
99
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Investment income from remained equity measured at
fair value after losing control power
Investment income from holding of available-for-sale
throughout the duration
Disposal of available-for-sale financial assets investment
income
Investment income from holding of available-for-sale
financial assets calculated by amortized cost method
investment income from disposal of available-for-sale
financial assets calculated by amortized cost method
Investment income from holding of other bond
investments
Investment income from disposal of other bond
investments
Investment income from financial assets measured at fair
value through current profit and loss during the duration
Investment income from disposal of financial assets
measured at fair value through current profit and loss
Investment income from holding of held-to-maturity
investments
Investment income from disposal of held-to-maturity
investments
Investment income from holding of available-for-sale
financial assets
Investment income from disposal of available-for-sale
financial assets
Others
Total -3,451,062.12 -27,108,151.12
39. Losses from credit impairment
Item Year 2020 Year 2019
Impairment losses of notes receivable credit
Impairment losses of accounts receivable credit 149,123.18 -2,814,052.18
Impairment losses of other receivable credit -1,407,996.71 -669,774.54
Impairment losses of bond investment credit
Impairment losses of other bond investment credit
Impairment losses of long-term other receivable
credit
Total -1,258,873.53 -3,483,826.72
40. Losses from asset impairment
Item Year 2020 Year 2019
Losses for falling price of inventory 597,106.59 -4,782,307.01
Impairment loss of long-term equity investments
100
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Impairment loss of investment Property
Impairment loss of fixed Asset -10,550,113.62 -5,639,143.73
Impairment loss of engineering materials
Impairment loss of construction in progress
Impairment loss of biological assets
Impairment loss of oil-and-gas assets
Losses on intangible asset impairment
Losses on goodwill impairment
Losses on bad debt
Disposal of a long-term equity investment of
investment returns
Investment income from financial assets measured at
fair value through current profit and loss during the
Others
Total -9,953,007.03 -10,421,450.74
41. Asset disposal income
The amount included in
Item Year 2020 Year 2019 the current non-recurring
profit and loss.
Total profits of holding available-for-sale
non-current assets disposal
Total profits of holding unavailable-for-sale -448,967.59 -3,068,753.15 -448,967.59
non-current assets disposal
Including: fixed assets -448,967.59 -3,068,753.15 -448,967.59
Construction in progress
Productive biological assets
Profits of disposal of intangible assets
Total -448,967.59 -3,068,753.15 -448,967.59
42. Non-operating income
Amounts included in the
Item Year 2020 Year 2019 non-recurrent profit and loss for
the current year
Non-current assets damage
2,160.36 2,160.36
and retirement gains
Donation received
Gains on stock-tacking
Government subsidies 16,900.00 27,000.00 16,900.00
Others 74,145.66 251,243.52 74,145.66
101
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Profits from merger of
enterprises not under the same 40,984,783.95 40,984,783.95
control
Total 41,077,989.97 278,243.52 41,077,989.97
Government subsidies included in current profit and loss
Subsidy item Year 2020 Year 2019
Related to assets:
Focus on supporting subsidy funds for science and technology enterprises
Incentives for contributions to economic development
Related to profits:
Warehousing reward and R & D investment subsidy of scientific and
16,900.00
technological enterprises in Banan District
Innovation fund by Jiulongpo Treasury payment center 27,000.00
Total 16,900.00 27,000.00
43. Non-operating expenses
Amounts included in the
Item Year 2020 Year 2019 non-recurrent profit and loss for
the current year
Donation outlay
Gains or losses from stock-tacking
Loss of non-current assets damaged
1,572,191.89 1,572,191.89
and scrapped
Unusual losses
Other 480.80 480.80
Total 1,572,672.69 1,572,672.69
44. Income tax expenses
（1）Details of income tax expense
Items Year 2020 Year 2019
Income tax at current period 297,185.27 1,443,514.31
Deferred income tax 202,329.74 - 1,210,841.59
Total 499,515.01 232,672.72
（2）Accounting profit and income tax expense adjustment process
Amount of current
Item
period
Total profit 1,915,457.46
102
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Income tax expense at statutory / applicable tax rates 478,864.37
Effect of different tax rates applicable to subsidiaries -192,627.16
Income tax adjustments on prior periods
Effect of non-taxable income -9,383,430.46
The impact of R&D expenses -2,472,093.35
The impact of non-deductible costs, expenses and losses 213,277.80
Affect the use of deferred tax assets early unconfirmed deductible losses
Deductible losses of unrecognized deferred income tax assets in the current period 11,855,523.81
The adjustment of tax rate leads to the change of the beginning-balance of deferred income
tax assets/liabilities
Total 499,515.01
45. Other comprehensive income
Details of the disclosure of other comprehensive income can be found in the notes to the financial
statements No.28
46. Items of the statement of cash flows
（1）Cash received from other operating activities
Item Year 2020 Year 2019
Interest income 251,975.74 18,415.41
Government subsidies 4,466,559.88 1,084,774.93
Deposits, petty cash 11,827,569.92 35,925,088.91
Total 16,546,105.54 37,028,279.25
（2）Cash paid for other operating activities
Item Year 2020 Year 2019
Deposits, petty cash and allotment 472,285.28 53,422,525.28
Expenses paid in cash during the period 28,680,763.55 25,379,424.08
Total 29,153,048.83 78,801,949.36
（3）Cash received from other investing activities
Item Year 2020 Year 2019
61,450,668.55
Acquisition of subsidiaries
Total 61,450,668.55
103
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
（4）Cash paid for other investing activities
Item Year 2020 Year 2019
Financial periodic deposits 40,000,000.00
Total 40,000,000.00
（5）Cash received from other financing activities
Item Year 2020 Year 2019
Interest 1,320,374.18 2,480,337.74
Proceeds from discounting of financing notes received 88,769,216.54 46,316,071.52
Collection of financing 216,340,000.00 641,706,002.32
Total 306,429,590.72 690,502,411.58
（6）cash paid for other financing activities
Item Year 2020 Year 2019
Payments for matured financing notes 398,125,000.00 815,885,785.44
cash deposit for financing such as bills and loans 128,949,610.08 77,522,857.83
Total 527,074,610.08 893,408,643.27
47. Supplementary information to the statement of cash flows
（1）Supplementary information to the statement of cash flows
Supplementary information Year 2020 Year 2019
1、Net profit adjusted to cash flows from operating activities
Net profits 1,415,942.45 -121,128,719.93
Add: provision for credit impairment 1,258,873.53 3,483,826.72
Add: provision for assets impairment 9,953,007.03 10,421,450.74
Add: depreciation of fixed assets, depletion of oil and gas assets 33,781,630.33 32,936,678.21
and depreciation of productive biological assets
Amortization of intangible assets 1,004,549.05 657,864.72
Amortization of long-term deferred expenses 49,500.00 1,912,833.34
Losses on disposal of fixed assets, intangible assets and other 448,967.59 3,068,753.15
long-term assets ("-" for gains)
104
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Losses on discarding of fixed assets ("-" for gains) 1,572,191.89
Losses from changes in fair value ("-" for gains)
Financial expenses ("-" for income) 23,719,626.23 23,726,455.73
Investments losses ("-" for gains) 3,451,062.12 27,108,151.12
Decreases in the deferred income tax assets ("-" for increases) -213,146.14 -1,210,841.59
Increases in the deferred income tax liabilities ("-" for decreases) 1,908,551.51
Decreases in inventories ("-" for increases) -22,827,528.18 31,248,364.66
Decreases in operating receivables ("-" for increases) -30,853,916.35 -50,994,532.30
Increases in operating receivables（"-" for decreases） 140,343,815.61 52,184,072.85
Others
Net cash flows from operating activities 165,013,126.67 13,414,357.42
2、Significant investment and financing activities involving no
cash receipts and payments
Conversion of debt into capital
Convertible corporate bonds maturing within one year
Fixed assets acquired under financial lease
3、Net change in cash and cash equivalents:
Closing balance of cash 79,310,253.55 9,390,326.10
Less: Opening balance of cash 9,390,326.10 72,551,130.34
Add: Closing balance of cash equivalents
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents 69,919,927.45 -63,160,804.24
（2）Component of cash and cash equivalents
Item Year 2020 Year 2019
1. Cash 79,310,253.55 9,390,326.10
Including: cash on hand 5,418.26
Unrestricted bank deposit 79,304,835.29 9,390,326.10
Other unrestricted Cash and cash equivalents
Unrestricted bank deposit placed in central bank
2. Cash equivalents
Including: bond investments maturing within three months
3. Balance of cash and cash equivalents as at December 31, 2020 79,310,253.55 9,390,326.10
105
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Net cash paid to acquire subsidiaries in the current period
Item Amount
Cash or cash equivalent paid for business combination in current 20.54
period
Including: Chongqing Pingshan TK Carburetor Co., Ltd 20.54
Less: cash and cash equivalents held by the company on the purchase 61,450,689.09
day
Including: Chongqing Pingshan TK Carburetor Co., Ltd 61,450,689.09
Add: cash or cash equivalent paid in the current year for business
combination occurred in previous period
Net cash paid for acquiring subsidiaries -61,450,668.55
48. Assets with restrictions on their ownership or use right
Book value as at
Item Reason for restriction
December 31, 2020
Monetary assets 80,032,987.92 guarantee deposit, fixed deposit
Total 80,032,987.92
49. Government subsidies
（1）Government subsidies confirmed in current period
Asset-related Revenue related
Write- Whether
Subsidy item Amount down actually
deferred deferred Non-operating Write-down
of Other income received
income income income of cost
book
value
Emergency supply subsidy of
Chongqing Banan District Yes
100,000.00 100,000.00
treasury payment center
Obtained subsidy for staff Yes
stability of Chongqing
3,048,959.00 3,048,959.00
Jiulongpo District
Employment and talent center
Subsidy for talent Yes
400,000.00 400,000.00
introduction in 2020
Reward from Jiulong Park Yes
Finance Office of Chongqing
45,000.00 45,000.00
hi tech Industrial
Development Zone
106
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Asset-related Revenue related
Write- Whether
Subsidy item Amount down actually
deferred deferred Non-operating Write-down
of Other income received
income income income of cost
book
value
Obtained subsidy for Yes
international service trade
from Jiulongpo District
10,000.00 10,000.00
Finance Bureau of Chongqing
Jiulongpo District Commerce
Committee
Received patent subsidy from Yes
Chongqing Jiulongpo District
23,200.00 23,200.00
market supervision and
Administration Bureau
Received subsidies for Yes
recruitment of key enterprises
54,200.00 54,200.00
from Chongqing Jiulongpo
District Finance Bureau
Received quality management Yes
award funds from Chongqing
Jiulongpo District market 300,000.00 300,000.00
supervision and
Administration Bureau
Received science and Yes
technology project subsidy
100,000.00 100,000.00
from Chongqing Jiulongpo
Finance Bureau
Obtained patent subsidy fee Yes
of Chongqing Intellectual 6,000.00 6,000.00
Property Office in 2019
Received the first batch of Yes
special project funds for
technological innovation of 200,000.00 200,000.00
Chongqing Municipal Bureau
in 2020
Received patent subsidy from Yes
Chongqing Jiulongpo District
32,200.00 32,200.00
market supervision and
Administration Bureau
Received subsidies for Yes
motorcycle EFI project of
100,000.00 100,000.00
Banan District treasury
payment center
Yes
Third generation service fee 30,100.88 30,100.88
Reward of medical Treasury Yes
science and technology 16,900.00
enterprises in Banan District
Total 4,449,659.88 4,449,659.88 16,900.00
2). Government subsidies included in current profit and loss
Included in the
Asset-related / Included in the
Subsidy item Non-operating Write-down of cost
revenue-related Other income
income
Emergency supply subsidy of
100,000.00
Chongqing Banan District
107
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Included in the
Asset-related / Included in the
Subsidy item Non-operating Write-down of cost
revenue-related Other income
income
treasury payment center
Obtained subsidy for staff
stability of Chongqing
3,048,959.00
Jiulongpo District
Employment and talent center
Subsidy for talent introduction
400,000.00
in 2020
Reward from Jiulong Park
Finance Office of Chongqing
45,000.00
hi tech Industrial
Development Zone
Obtained subsidy for
international service trade
from Jiulongpo District
10,000.00
Finance Bureau of Chongqing
Jiulongpo District Commerce
Committee
Received patent subsidy from
Chongqing Jiulongpo District
23,200.00
market supervision and
Administration Bureau
Received subsidies for
recruitment of key enterprises
54,200.00
from Chongqing Jiulongpo
District Finance Bureau
Received quality management
award funds from Chongqing
Jiulongpo District market 300,000.00
supervision and
Administration Bureau
Received science and
technology project subsidy
100,000.00
from Chongqing Jiulongpo
Finance Bureau
Obtained patent subsidy fee of
Chongqing Intellectual 6,000.00
Property Office in 2019
Received the first batch of
special project funds for
technological innovation of 200,000.00
Chongqing Municipal Bureau
in 2020
Received patent subsidy from
Chongqing Jiulongpo District
32,200.00
market supervision and
Administration Bureau
Received subsidies for
motorcycle EFI project of
100,000.00
Banan District treasury
payment center
Third generation service fee 30,100.88
Reward of medical Treasury
science and technology 16,900.00
enterprises in Banan District
Total 4,449,659.88 16,900.00
108
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
V. Change of consolidation scope
1. Business combination under different control
(1) Business combination under different control in the current period
Income of the Net profit of
Proporti Basis for
Method of acquiree from the acquiree
Time of on of determini
Name of the Cost of equity equity the purchase from the
equity equity Purchase ng the
acquiree acquisition acquisitio date to the purchase date
acquisition acquired day purchase
n end of the to the end of
(%) date
period the period
Chongqing
Pingshan TK Take
2020-8-31 40,984,825.03 100.00 Purchase 2020-8-31 14,556,584.49 203,155.49
Carburetor Co., Ltd control
(2) Combination cost and goodwill
Item Amount
Combination cost
Including: Cash 20.54
Fair value of non-cash assets
Fair value of debt issued or assumed
Fair value of equity securities issued
Fair value of contingent consideration
Fair value of equity held before the purchase day 40,984,804.49
Others
Total 40,984,825.03
Less: Fair value of identifiable net assets 81,969,608.98
Note: The company acquired 50% equity of Chongqing Pingshan TK Carburetor Co., Ltd. and
conducted audit and evaluation with December 31, 2019 as the base date. It has been audited by
Dahua Certified Public Accountants (special general partnership) and issued Dahua Hezi [2020] No.
001094 audit report. Sichuan Tianjian Huaheng Assets Appraisal Co., Ltd. evaluated the equity and
issued the appraisal report (chhpb [2020] No. 14.)
109
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
(3) The identifiable assets and liabilities of the acquiree on the purchase day
Chongqing Pingshan TK Carburetor Co.,
Ltd
Item
Fair value on Book value on
purchase day purchase day
Asset
Monetary assets 61,450,689.09 61,450,689.09
Notes receivable 2,656,242.80 2,656,242.80
Accounts receivable 7,712,897.60 7,712,897.60
Prepayments 329,754.65 329,754.65
Other receivables 636,489.76 636,489.76
Inventories 4,814,007.97 4,814,007.97
Fixed assets 19,801,292.63 16,658,992.63
Construction in progress 682,610.64 682,610.64
Intangible assets 4,675,311.39 1,267,542.93
Long-term prepaid expense 41,250.00 41,250.00
Deferred income tax assets 544,718.27 544,718.27
Total assets 103,345,264.80 96,795,196.34
Liabilities
Advances from customers 3,979,865.66 3,979,865.66
Accounts payable 44,710.00 44,710.00
Employee benefits payable 13,835,414.10 13,835,414.10
Taxes payable 396,862.23 396,862.23
Other payables 1,081,009.93 1,081,009.93
Deferred income tax liabilities 2,037,793.90 400,276.78
Total liabilities 21,375,655.82 19,738,138.70
Net assets 81,969,608.98 77,057,057.64
Less: minority equity
Net assets acquired 81,969,608.98 77,057,057.64
Note: In the above table, the value-added amount is based on the fair value on the purchase day
between the book value of assets of the acquired company on August 31, 2020. The combination
cost is the sum of the fair value of the original 50% equity held by the company and the
consideration paid on the purchase day. Due to the different proportion of the acquired equity and
the time of the base date and the purchase day, the combination cost is the sum of the fair value of
110
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
the acquired equity held before the purchase day and the consideration paid on the purchase day.
(4) Gains or losses arising from the re-measurement of equity held before the purchase day at
fair value
Gains or losses arising
The method of The amount of other
Book value of The fair value of the from the
the fair value and comprehensive
Name of the original equity original equity held re-measurement of the
main assumptions income transferred
acquiree held before on the before on the original equity held
on the purchase into investment
purchase day purchase day before according to the
day income
fair value
The fair value of the
equity on the
purchase day is
determined by the
Chongqing
asset-based method
Pingshan TK
39,045,423.41 40,984,804.49 1,939,381.08 and based on the 0.00
Carburetor
assumption that the
Co., Ltd
enterprise continues
to operate and the
assets do not change
the way of use.
VI.Equity in other entities
1. Equity in subsidiaries
(1) Composition of enterprise groups
Shareholding ratio
Main business Registered (%) Acquisition
Name of subsidiary Business nature
areas place method
Indir
Directly
ectly
Chongqing Jianshe Production and Establishment
Automobile A/C sales of by
Chongqing Chongqing 100.00
Automobile Air
Co., Ltd. Conditioner investment
Chongqing Pingshan Production and Merger under
TK Carburetor Co., Chongqing Chongqing sales of 100.00 different
Ltd motorcycle parts control
2. Equity in joint ventures and associates
（1）Major joint ventures
Name of joint Main Register Business Shareholding ratio Accounting treatment methods
venture or business ed nature (%) for the investments in joint
111
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
associate areas place Directly Indirectly ventures or associates
Chongqing Hanon Compressor
Jianshe Automotive Chongqi Chongqi assembly and
50.00 Equity method
Thermal Systems ng ng core auto parts
Co., Ltd. production
（2）Major financial information of significant joint ventures
Beginning balance / Amount of the
Ending balance / Current amount
previous period
Chongqing
Chongqing Chongqing Chongqing Hanon
Item Hanon Jianshe
Pingshan TK Pingshan TK Jianshe Automotive
Automotive
Carburetor Co., Carburetor Co., Thermal Systems
Thermal Systems
Ltd. Ltd. Co., Ltd.
Co., Ltd.
Current assets 207,788,619.72 85,520,050.06 106,444,360.21
Including: cash and cash 14,910,653.69 67,698,607.56 1,829,891.00
equivalents
Non-current assets 403,946,863.16 19,683,842.52 431,151,340.69
Total assets 611,735,482.88 105,203,892.58 537,595,700.90
Current liabilities 147,202,798.08 28,102,195.28 69,997,756.39
Non-current liabilities 95,221,965.54 400,276.78 87,150,701.74
Total liabilities 240,767,353.62 28,502,472.06 157,148,458.13
Minority equity
Equity attributable to the
shareholders of parent 369,310,719.26 76,701,420.52 380,447,242.77
company
Shares in net assets calculated
according to the shareholding 184,655,359.63 38,350,710.26 190,223,621.39
ratios
Adjustment events
- Goodwill
112
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Beginning balance / Amount of the
Ending balance / Current amount
previous period
Chongqing
Chongqing Chongqing Chongqing Hanon
Item Hanon Jianshe
Pingshan TK Pingshan TK Jianshe Automotive
Automotive
Carburetor Co., Carburetor Co., Thermal Systems
Thermal Systems
Ltd. Ltd. Co., Ltd.
Co., Ltd.
- Unrealized profits of
internal transactions
- Others
The book values of equity 186,213,719.02 38,867,604.85 191,781,980.78
investments in joint ventures
The fair values of equity
investments in joint ventures
with a public offer
Operating income 232,203,748.88 51,209,764.80 90,350,122.19
Financial expenses 4,678,168.50 -2,043,145.37 -96,978.98
Income tax expenses 812,408.78
Net profit -23,897,617.66 -26,874,602.49
-11,136,523.51
Net profit from termination
Other comprehensive income
Total comprehensive income -11,136,523.51 -23,897,617.66 -26,874,602.49
Dividends received from joint
ventures for the current 2,000,000.00
year
VII. Related parties and related party transactions
1. The parent company of the Company
Name of the Shareholding Voting ratio
Registered Business Registered
parent ratio in the in the
place nature capital
company Company (%) Company (%)
China South Beijing State-owned RMB 17,469.68 71.13 71.13
113
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Industries Group assets million
Corporation investment
Note: The ultimate controller of the Company is The State-owned Assets Supervision and
Administration Commission of the State Council.
The changes of parent company registered capital (million):
Item 2020.01.01 Increase in 2020 Decrease in 2020 2020.12.31
Amount 17,469.68 17,469.68
2. Subsidiaries of the Company
Please refer to Note Ⅵ.1 “Equity in subsidiaries” for the details of subsidiaries of the Company.
3. The joint ventures and associates of the Company
Please refer to Note Ⅵ.2 “Equity in joint ventures and associates” for the details of major joint
ventures or associates of the Company.
The related party transactions with the Company for the current year:
Name of joint venture or associate Relationship with the company
Chongqing Hanon Jianshe Automotive Thermal Systems Co., Ltd. Joint venture
4. Other related parties of the Company
Name of other related parties Relationship with the Company
Under the common control of the
Chongqing Jianshe Industrial (Group) Co., Ltd. ("Jianshe industry ")
same party
Under the common control of the
Chongqing Jianshe industry (Group) Co., Ltd("Jianshe industry (Group) ")
same party
Under the common control of the
South Finance Co., Ltd. ("Finance Company ")
same party
A Joint venture of a subsidiary of a
Chongqing Jianxing Machinery Co., Ltd. ("Jianxing Machinery")
controlling shareholder
Under the common control of the
Chongqing Changan Automobile Co., Ltd ("Chongqing Changan")
same party
Chongqing Changan Automobile Co., Ltd. Beijing Changan Automobile Under the common control of the
Company ("Beijing Changan") same party
A Joint venture of a subsidiary of a
Chongqing Changan Suzuki Motor Co., Ltd. ("Changan Suzuki ")
controlling shareholder
Under the common control of the
Hebei Changan Motor Co., Ltd. ("Hebei Changan ")
same party
Nanjing Changan Motor Co., Ltd. ("Nanjing Changan ") Under the common control of the
114
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
same party
Under the common control of the
Baoding Changan Bus Manufacturing Co., Ltd ("Baoding Changan")
same party
Under the common control of the
Hefei Changan Motor Co.Ltd ("Hefei Changan")
same party
Under the common control of the
Chongqing South Motorcycle Co.Ltd ("South Motorcycle ")
same party
Chongqing Changan Motor Customer Service Co., Ltd. ("Changan Motor Under the common control of the
Customer Service ") same party
Chongqing Changan Automobile International Sales & Service Co., Ltd Under the common control of the
（"Changan Automobile sales "） same party
Chongqing North Construction import and export trade co.ltd ("import and Under the common control of the
export company") same party
Under the common control of the
Hafei Motor share company ("Hafei motor")
same party
Changan Ford Motor Co.Ltd Harbin branch ("Changan Ford Harbin A Joint venture of a subsidiary of a
branch") controlling shareholder
Under the common control of the
Harbin dongan Motor Power shares Co. Ltd ("Harbin dongan power")
same party
Under the common control of the
Sichuan Huaqing Machinery co. Ltd
same party
Under the common control of the
South Air International Co. Ltd ("South Air ")
same party
Southwest Ordnance Chongqing Environmental Protection Research Under the common control of the
Institute Co., Ltd（" Southwest Ordnance"） same party
Under the common control of the
China Ordnance Equipment Group commercial factoring Co., Ltd
same party
A Joint venture of a subsidiary of a
Chongqing Jianshe Yamaha Motorcycle Co., Ltd（"Jianshe Yamaha"）
controlling shareholder
A Joint venture of a subsidiary of a
Chongqing Chang'an Minsheng Logistics Co., Ltd（"Minsheng Logistics "）
controlling shareholder
A Joint venture of a subsidiary of a
Chongqing Jianshe lijue Industrial Co., Ltd（" Jianshe lijue"）
controlling shareholder
Board Chairman, legal
Xuechuan Yan
representative
Qihong Dong Board director
Employee director, deputy secretary
of Party committee, Secretary of
Jiang Yu
Discipline Inspection Commission,
chairman of trade union
Di Zhang Board director
Yongqiang Zhou Board director
Lin Hao Board director
Jiaming Li Independent director
Fei Xie Independent director
Wei Liu Independent director
115
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Weiwei Song Independent director
Hushan Zhang supervisory board chairman
Wenbiao Yu Vice-general manager
Aijun Fan Vice-general manager
Vice-general manager、Financial
Mingxian Tan
Officer-in-charge
Xianyun Lu Supervisory board chairman
Lungang Zhang Supervisor
Guoan Qiao Supervisor
Yongjiang Li Employee Supervisor
Song Rao Employee Supervisor
5. Related party transactions
(1). Purchase of goods, rendering and receipt of labor services
① Table of sales of goods
Content of Amount
Related party related party
transactions Year 2020 Year 2019
Chongqing Changan Automobile Co., Ltd. Auto Parts 121,152,914.63 74,175,496.49
Chongqing Changan Suzuki Automobile Co., Ltd. Auto Parts 8,312,846.45 9,026,012.84
Hefei Changan Automobile Co., Ltd. Auto Parts 12,311,294.83 11,004,057.30
Nanjing Changan Automobile Co., Ltd. Auto Parts 1,955,924.44 4,729,999.23
Baoding Changan Automobile Co., Ltd. Auto Parts 2,231,755.78 5,859,099.25
Hebei Changan Automobile Co., Ltd. Auto Parts 104,905.84 74,904.83
Beijing Changan Automobile Co., Ltd. Auto Parts 2,557.55 5,746.23
Chongqing Changan Automobile customer Auto Parts
18,532.42 20,146.98
Service Co., Ltd.
South Air International Co. Ltd ("South Air ") Auto Parts 144,000.00 144,000.00
Motorcycle
Chongqing Jianshe Yamaha Motorcycle Co.,Ltd 3,469,076.51 2,282,073.73
Parts
Parts
Chongqing Jianshe industry (Group) Co., Ltd 948,359.57
inspection
Chongqing Jianshe industry (Group) Co., Ltd Material 280,236.11
Storage
Chongqing Chang'an Minsheng Logistics Co., Ltd 581,396.56
services
Southwest Ordnance Chongqing Environmental Parts
1,039,838.83
Protection Research Institute Co., Ltd inspection
Total 152,553,639.52 107,321,536.88
116
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
(2) The situation of related-party lease
① The Company as a lessor：
The kind of leased Leasing asset of Leasing asset of
The name of lessor
assets 2020 2019
Chongqing Jianshe mechanical and electrical
Plant 3,187,684.37 5,670,620.70
co., LTD.
Chongqing Jianshe mechanical and electrical
Machinery Equipment 1,262,889.91
co., LTD.
② The Company as a lessee：
The kind of leased Leasing asset of Leasing asset of
The name of lessor
assets 2020 2019
Chongqing Jianshe mechanical and electrical
Plant 3,131,505.24 3,060,055.14
co., LTD.
(3) Related Guarantee
The Company act as guarantor
Guaranteed Starting date Maturity date Whether the guarantee has
Guarantee
amount of guaranty of guaranty been fulfilled
Chongqing Jianshe
Automobile A/C Co., 17,710,000.00 2020/1/17 2021/1/16 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 2020/6/19 2021/6/18 No
Ltd. 30,000,000.00
Chongqing Jianshe
Automobile A/C Co., 2020/7/29 2021/7/28 No
Ltd. 30,000,000.00
Chongqing Jianshe
Automobile A/C Co., 2020/8/11 2021/8/10 No
Ltd. 30,000,000.00
Chongqing Jianshe
Automobile A/C Co., 2020/12/4 2021/12/3 No
Ltd. 55,790,000.00
Chongqing Jianshe
Automobile A/C Co., 2020/4/13 2021/4/12 No
Ltd. 24,997,000.00
Chongqing Jianshe
Automobile A/C Co., 9,999,500.00 2020/4/20 2021/4/19 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 2020/4/28 2021/4/27 No
Ltd. 25,013,500.00
117
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Guaranteed Starting date Maturity date Whether the guarantee has
Guarantee
amount of guaranty of guaranty been fulfilled
Chongqing Jianshe
Automobile A/C Co., 34,500,000.00 2020/10/12 2021/5/24 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 20,000,000.00 2020/10/12 2021/5/24 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,490,000.00 2020/10/19 2021/5/24 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 10,000,000.00 2020/8/27 2021/8/27 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 20,000,000.00 2020/11/3 2021/5/18 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 50,000,000.00 2020/2/28 2021/2/27 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,020,000.00 2020/7/31 2021/1/31 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 46,400,000.00 2020/9/23 2021/3/16 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,000,000.00 2020/10/16 2021/4/13 No
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,000,000.00 2019/7/5 2020/1/5 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,300,000.00 2019/7/11 2020/1/11 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 50,000,000.00 2019/8/16 2020/2/15 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 28,570,000.00 2019/9/20 2020/3/20 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 35,710,000.00 2019/10/10 2020/4/9 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 14,285,000.00 2019/10/16 2020/4/15 Yes
Ltd.
Chongqing Jianshe 35,710,000.00 2019/10/23 2020/4/22 Yes
Automobile A/C Co.,
118
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Guaranteed Starting date Maturity date Whether the guarantee has
Guarantee
amount of guaranty of guaranty been fulfilled
Ltd.
Chongqing Jianshe
Automobile A/C Co., 46,400,000.00 2019/12/26 2020/6/26 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,020,000.00 2020/1/8 2020/7/8 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 30,000,000.00 2019/9/10 2020/9/9 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 30,000,000.00 2019/9/17 2020/9/16 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 28,570,000.00 2020/3/17 2020/9/17 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 30,000,000.00 2019/10/8 2020/9/28 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 12,000,000.00 2019/10/8 2020/9/28 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 24,500,000.00 2019/10/28 2020/10/27 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 50,000,000.00 2019/11/20 2020/11/19 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 34,500,000.00 2019/11/28 2020/11/27 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 55,790,000.00 2019/12/9 2020/12/8 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 20,000,000.00 2019/12/12 2020/12/11 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 40,000,000.00 2020/6/15 2020/12/15 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 25,490,000.00 2019/12/17 2020/12/16 Yes
Ltd.
Chongqing Jianshe
Automobile A/C Co., 20,000,000.00 2019/12/18 2020/12/16 Yes
Ltd.
119
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
(4) Payroll of core management staff
Item 2020 2019
Payroll of core management staff 3,956,919.45 2,696,304.00
(5) Deposits in related parties
Related-party name Increase during the Decrease during the
2020.01.01 2020.12.31
period period
Finance company of
China South 5,948,128.99 1,628,113,120.09 1,558,761,304.05 75,299,945.03
Industries Group
Note: The total deposit interest of related parties received in the current period is 118,772.10 Yuan.
(6) Loan from related parties
Annual
Starting Termination Ending
Related-party name interest Guarantor
date date balance
rate
Finance company of China
2020/12/11 2021/3/11 4.35 % Credit borrowings 25,000,000.00
South Industries Group
Finance company of China
2020/6/15 2021/6/15 3.92% Credit borrowings 20,000,000.00
South Industries Group
Finance company of China
2020/11/17 2021/11/17 3.92% Credit borrowings 30,000,000.00
South Industries Group
Finance company of China
2020/12/2 2021/12/2 4.35% Credit borrowings 28,000,000.00
South Industries Group
Finance company of China
2020/12/2 2021/12/2 4.35% Credit borrowings 30,000,000.00
South Industries Group
Finance company of China
2020/12/29 2021/12/29 4.35% Credit borrowings 23,500,000.00
South Industries Group
Finance company of China
2020/7/31 2021/7/31 2.00% Credit borrowings 9,400,000.00
South Industries Group
Finance company of China
2020/10/29 2021/10/29 2.00% Credit borrowings 4,510,000.00
South Industries Group
6. Related party receivables/payables
（1）The item of receivables
2019.12.31 2018.12.31
Item Related parties bad-debt bad-debt
book balance book balance
provision provision
Accounts Chongqing Jianshe Yamaha
receivable 1,600,948.83 935,022.27
Motorcycle Co.,Ltd
Accounts Chongqing Hanon Jianshe
receivable Automotive Thermal Systems Co., 1,057,181.69 146,715.27
Ltd.
120
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Accounts Chongqing Changan Automobile Co.,
receivable 35,860,898.25 23,714,911.56
Ltd.
Accounts
receivable Hefei Changan Automobile Co., Ltd. 6,144,169.57 7,569,880.13
Accounts Baoding Changan Automobile Co.,
receivable 176,024.12 1,464,206.17
Ltd.
Accounts Chongqing Changan Suzuki
receivable 144,754.60 1,245,998.54
Automobile Co., Ltd.
Accounts Nanjing Changan Automobile Co.,
receivable 757,093.89 69,349.42
Ltd.
Accounts
receivable Hebei Changan Automobile Co., Ltd. 125,588.19 36,326.70
Accounts Chongqing Changan Automobile Co.,
receivable Ltd. Beijing Changan Automobile 3,046.25
Company ("Beijing Changan")
Accounts 3,999,944.4
receivable Hafei motor co., Ltd. 3,999,944.43 3,999,944.43 3,999,944.43
3
Notes Baoding Changan bus Manufacturing
receivable 1,080,000.00 230,000.00
Co., Ltd.
Notes Chongqing Changan Automobile Co.,
receivable 20,462,109.25 404,031.22
Ltd.
Notes
receivable Hefei Changan Automobile Co., Ltd
4,501,490.44
Notes Nanjing Changan Automobile Co.,
receivable Ltd 880,000.00
Other Chongqing North Jianshe Import and
receivables 350,000.00
Export trading Co.,Ltd
Other Chongqing Jianshe Lijue Industry
receivables 1,478,870.07 395,723.62
Co.,Ltd
Other China South Industries Group
receivables 39,300.00
Corporation
（2）The item of payables
2019.12.31 2018.12.31
Item Related parties
book balance book balance
Accounts
Chongqing Yamaha Motorcycle Co., Ltd. 23,210.00 23,210.00
payable
Accounts China South Industries Group Commercial Factoring
payable Co.,Ltd 32,950,000.00 11,800,000.00
Chongqing Jianshe Industrial (Group) Co., Ltd.
Other payable 563,402.75 644,513.49
("Jianshe industry(Group) ")
Chongqing Jianshe Mechanical and electrical Co.,
Other payable 148,008.76
Ltd.
7. Commitments by related parties
None
121
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
VIII.Commitments or contingencies
1. Significant commitment events
As at December 31, 2020, the Company did not need to disclose important commitments.
2. Contingencies
As at December 31, 2020, the Company did not need to disclose important contingencies.
IX. Subsequent events
As the approval date of audit report, the Company did not need to disclose important subsequent
events.
X. Other significant events
As at December 31, 2020, the Company did not need to disclose other significant events.
Ⅺ. Notes to the main items of financial statements of parent company
1. Accounts receivable
(1) Accounts receivable measured as amortized cost
2020.12.31 2019.12.31
Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Accounts receivable 3,480,832.08 1,291,496.94 2,189,335.14 2,476,442.75 1,291,496.94 1,184,945.81
Total 3,480,832.08 1,291,496.94 2,189,335.14 2,476,442.75 1,291,496.94 1,184,945.81
(2) Bad debt reserves
No matter whether there is material financing component, the company measured losses reserves
provision using estimated credit losses method during the period.
①Accounts receivable with provision for bad debt made on a portfolio with similar aging
Estimated credit losses Provision for
Book balance impairment
during the period
2,189,335.14
Within one year
122
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
1-2 years
2-3 years
1,291,496.94 100.00 1,291,496.94
Over 3 years
3,480,832.08 1,291,496.94
Total
②Changes of Bad debt
Increase Decrease during the period
Item 2020.01.01 during the 2020.12.31
period Recovery or Elimination
reversal or write-off
Accounts
receivable
provision for 1,291,496.94 1,291,496.94
impairment
(3) Top five accounts receivable as at December 31, 2020:
Total amount of top five accounts receivable is 3,057,631.10 Yuan, which accounting for 87.84% of
total accounts receivable, and the corresponding provision of accounts receivable bad debts
impairment is 868,836.00 Yuan.
Amount of Amount of
Proportion of to
ending ending bala
Company Name Aging tal accounts rec
nce for bad
balance eivable %
debts
Chongqing Jianshe Hanon Heat M
1,057,181.69 Within 2 years 30.37
anagement system Co., Ltd.
Chongqing Jianshe Yamaha Motorc Within 6 months
914,657.32 26.28
ycle Co., Ltd
Wuhan Longchang Company Wujia Over 5 years
473,539.96 13.60 473,539.96
o Market Department
China Aerospace Science and Tech Over 5 years
nology Corporation long March M 395,296.04 11.36 395,296.04
achinery Factory
Chongqing Qiutian Gear Co., Ltd 216,956.09 Within 6 months 6.23
Total 3,057,631.10 87.84 868,836.00
2．Other receivables
123
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Item 2020.12.31 2019.12.31
Interest receivable
Dividend receivable
Other receivables 934,239.22 2,376,451.69
Total 934,239.22 2,376,451.69
(1) Situation of other receivables
2020.12.31 2019.12.31
Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Other receivables 6,854,489.04 5,920,249.82 934,239.22 6,817,831.44 4,441,379.75 2,376,451.69
Total 6,854,489.04 5,920,249.82 934,239.22 6,817,831.44 4,441,379.75 2,376,451.69
1) Provision of bad debts
A. Provision for bad debts of other accounts receivable at the first stage on December 31st 2020：
Estimated credit
Book balance losses during the Provision for impairment Reason
period
Provision in portfolio
Aging 5,060,099.13 81.54 4,125,859.91 Low recovery
possibility
5,060,099.13 81.54 4,125,859.91
Total
B. Provision for bad debts of other accounts receivable at the third stage on December 31st 2020：
Estimated credit
Book balance losses during the Provision for impairment Reason
period
Provision in single entity
Chongqing Jinxiang
Low recovery
Hoisting equipment 16,800.00 100.00 16,800.00
possibility
manufacturing
Yangzhou Qionghua
decoration engineering 56,500.00 100.00 56,500.00 Low recovery
possibility
equipment
Chongqing China Customs 78,825.36 100.00 78,825.36 Low recovery
possibility
124
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Goods pending quality
inspection and goods on 163,394.48 100.00 163,394.48 Low recovery
possibility
exhibition
Chongqing Jianshe lijue 1,478,870.07 100.00 1,478,870.07 Low recovery
Industrial Co., Ltd possibility
Total 1,794,389.91 100.00 1,794,389.91
2) Changes of bad debts provision
Stage One Stage Two Stage Three
Provision of Estimated credit
Estimated credit Total
impairment Estimated credit losses losses during the
losses during the
in next 12mongths period (not
period(happened)
happened)
Balance as at Jan 1st
2020 4,125,859.91 315,519.84 4,441,379.75
Beginning book
balance in this period
-transfer to the first
stage
-transfer to the second
stage
-transfer to the third
stage
Provision during the
period 1,478,870.07 1,478,870.07
Reversal during the
period
Elimination during the
period
Write off during the
period
Other changes
Balance as at Dec 31st
2020 4,125,859.91 1,794,389.91 5,920,249.82
3) Nature classification of other receivables
Nature 2020.12.31 2019.12.31
Commercial intercourse 6,854,489.04 6,817,831.44
125
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Total 6,854,489.04 6,817,831.44
4) Top five other receivable as at December 31, 2020:
Total amount of top five accounts receivable is 6,317,036.92 Yuan, which accounting for 92.16% of
total accounts receivable, and the corresponding provision of accounts receivable bad debts
impairment is 5,514,198.11 Yuan.
Percentage Provision o
Amount of e
Related of whole f impairme
Company Name Nature nding Aging
Party other nt of endin
balance g balance
receivables%
Shenzhen Jianshe Moto Trading 43.97
No 3,013,664.00 Over 5 years 3,013,664.00
Co.,Ltd
Chongqing Jianshe Trading 1,478,870.07 21.58 1,478,870.07
Yes Within 2 years
lijue Industrial Co., Ltd
Advance payment to Trading Within 6 11.71
No 802,838.81
employees months
Ningbo Jianshe Auto Trading 10.10
Co.,Ltd Chongqing No 692,035.31 Over 5 years 692,035.31
Office
Ningbo Jianshe Auto Trading 329,628.73 Within 6 4.81 329,628.73
No
Co.,Ltd months
Total 6,317,036.92 92.16 5,514,198.11
3. Long-term equity investments
（1）Classification of long-term equity investment
2020.12.31 2019.12.31
Item Provision Provision
Book balance for Book value Book balance for Book value
impairment impairment
Investments in
199,045,443.95 199,045,443.95 160,000,000.00 160,000,000.00
subsidiaries
Investments in
associates and 186,213,719.02 186,213,719.02 230,649,585.63 230,649,585.63
joint ventures
Total 385,259,162.97 385,259,162.97 390,649,585.63 390,649,585.63
（2）Investments in subsidiaries
Increase in Decrease
Investee 2020.01.01 2020.12.31
2020 in 2020
Chongqing Jianshe Automobile A/C
160,000,000.00 160,000,000.00
Co., Ltd.
Chongqing Pingshan TK Carburetor Co., 39,045,443.95 39,045,443.95
126
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Increase in Decrease
Investee 2020.01.01 2020.12.31
2020 in 2020
Ltd
Less: provision for long-term investment
impairment
Total 160,000,000.00 39,045,443.95 199,045,443.95
（3）Investments in associates and joint ventures
Increases/decreases in the current year
profits and
losses on Changes
Investee 2020.01.01 Other
Additional Decrease in investments
comprehens in other
investment investment recognized
ive income equity
under the
equity method
Joint ventures
Chongqing Pingshan TK
38,867,604.85 39,045,423.41 177,818.56
Carburetor Co., Ltd.
Chongqing Jianshe Hanon
Heat Management system 191,781,980.78 -5,568,261.76
Co., Ltd.
Total 38,867,604.85 39,045,423.41 177,818.56
&
Balance as
Increases/decreases in the current year
At December
Balance as at
Investee Declaration of 31, 2020 of
Provision for December 31, 2020
cash dividends or Other Provision for
impairment
profits impairment
Joint ventures
Chongqing Pingshan
TK Carburetor Co., 0.00
Ltd.
Chongqing Jianshe
Hanon Heat
186,213,719.02
Management system
Co., Ltd.
Total 186,213,719.02
4. Operating income and operating costs
（1）Operating income and costs are as follows：
Year 2020 Year 2019
Item
Income Cost Income Cost
Primary businesses 574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
127
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Other businesses 8,020,335.84 3,413,711.76 10,168,004.55 4,143,375.88
Total 582,119,961.20 565,869,149.78 601,057,530.18 616,528,393.54
（2）The main operating income and costs (by business) are as follows：
Year 2020 Year 2019
Product Name
Income Cost Income Cost
Motorcycle and
574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
auto parts
Total 574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
（3）The main operating income and costs (by product) are as follows：
Year 2020 Year 2019
Product Name
Income Cost Income Cost
Motorcycle and
574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
auto parts
Total 574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
（4）The main operating income and costs (by region) are as follows：
Year 2020 Year 2019
Product Name
Income Cost Income Cost
Chongqing 574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
Total 574,099,625.36 562,455,438.02 590,889,525.63 612,385,017.66
5. Investment income
item Year 2020 Year 2019
Long-term equity investment income calculated by
equity method
Disposal of a long-term equity investment of investment
-5,390,443.20 -27,108,151.12
returns
Investment income from remained equity measured at
fair value after losing control power
Investment income from holding of available-for-sale
throughout the duration
Disposal of available-for-sale financial assets investment
income
Investment income from holding of available-for-sale
financial assets calculated by amortized cost method
investment income from disposal of available-for-sale
financial assets calculated by amortized cost method
128
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Investment income from holding of other bond
investments
Investment income from disposal of other bond
investments
Investment income from financial assets measured at fair
value through current profit and loss during the duration
Investment income from disposal of financial assets
measured at fair value through current profit and loss
Investment income from holding of held-to-maturity
— —
investments
Investment income from disposal of held-to-maturity
— —
investments
Investment income from holding of available-for-sale
— —
financial assets
Investment income from disposal of available-for-sale
— —
financial assets
Others — —
Total -5,390,443.20 -27,108,151.12
XII. Supplementary information
1. Detailed statement of current non-recurring profit and loss
Item Amount Remark
Gains and losses on disposal of non-current assets -448,967.59
Tax returns, deduction and exemption approved beyond the authority
or without official approval documents
Government grants included in current profits and losses (except for
government grants closely related to the enterprise business, obtained 4,466,559.88
by quota or quantity at unified state standards)
Payment for use of state funds received from non-financial
institutions recorded in current profits and losses
Gains from the difference between the investment costs of acquisition 42,924,165.03
of subsidiaries, associates and joint ventures and share in the net fair
value of the identifiable assets of the investee when investing
Gains or losses from non-monetary asset exchange
Gains or losses from entrusting the investments or management of
asset
Impairment provision for force majeure such as natural calamities
Profits or losses from debt restructuring
Restructure expenses, such as the compensation for employee
relocation and integration costs
Gains or losses from transactions with obvious unfair transaction
price
129
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
Current net profit and loss of subsidiaries from the beginning of the
period to the date of business combination under the common control
Profits or losses arising from contingencies not related to the
company’s normal business
Except for effective hedging business related to the normal business
of the company, profits or losses from fair value changes in
held-for-trading financial assets and held-for-trading financial
liabilities, and investment income from disposal of held-for-trading
financial assets, held-for-trading financial liabilities and
available-for-sale financial assets
Disposal of transactional financial assets, transactional financial
liabilities and return on investments available for sale
Reversal of the impairment provision for receivables subject to 88,468.57
separate impairment test
Profits or losses from entrusted loans
Profits or losses from fair value changes in investment property
subsequently calculated with the fair value mode
Impacts of one-time adjusting the current profits or losses in
accordance with requirements of tax and accounting laws and
regulations on the current profits and losses
Custodian income from entrusted management
Other non-operating income and expenditure except for the above -1,496,366.67
items
Other profits or losses which can be deemed as non-recurring profits
or losses
Total non-recurrent gains and losses 45,533,859.22
Less: income tax impact of non-recurrent gains and losses 76,894.55
Net non-recurrent gains and losses 45,456,964.67
Less: net effect of non-recurrent gains and losses attributable to
minority shareholders
Non-recurring gains and losses attributable to common shareholders 45,456,964.67
of the company
2. Rate of return on net assets and earnings per share:
Weighted Earnings per share (Yuan)
average rate of Basic
Profit during the reporting period Diluted earnings
return on net earnings per
per share
assets (%) share
Net profit attributable to ordinary
0.8190 0.0119 0.0119
shareholders of the Company
Net profit attributable to ordinary
shareholders of the Company after -25.4748 -0.3689 -0.3689
deducting the non-recurring profit and loss
130
Chongqing Jianshe Vehicle System Co.,Ltd.
Notes To Financial Statements
For The Year Ended December 31, 2020
XIII．Documents Available for Inspection
I. Annual Report carrying personal signature and seal of the Chairman of the Board.
II. Financial Statements with signatures of the legal representative, the financial officer, and accounting manager.
III.Original copy of the Auditors’ Report with the seal of the CPA and signed by the certified
（ZXCGHSKZ[2021]No.302053.
IV. All of the originals of the Company’s documents and public notices publicized by the presses designated by
China Securities Regulatory Commission in the report period.
V.Statement on special audition on appropriation of capital by controlling shareholder and related parties of
Chongqing Jianshe Vehicle System Co., Ltd.( ZXCGHSZZ[2021]No.302023).
VI. Auditing Report on Internal Control for Chongqing Jianshe Vehicle System Co., Ltd.
（ZXCGHSZZ[2021]No.302022).
VII. Special review report on the situation of deposit and loan of Chongqing Jianshe Vehicle System Co., Ltd.
from the Military Equipment Finance Co., Ltd. ( ZXCGHSZZ[2021]No.302024).
VIII. Special verification opinion on the deduction of operating income of 2020 of Chongqing Jianshe Vehicle
System Co., Ltd. ( ZXCGHSZZ[2021]No.302001).
Chongqing Jianshe Vehicle System Co., Ltd.
April 28, 2021
131
