Chongqing Jianshe Vehicle System Co., Ltd.
2022 Annual Report
2023-015
April 2023
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, Chief financial officer and the Ms.Niu Yanli, the
person in charge of the accounting department (the person in charge of the accounting )hereby confirm the
authenticity and completeness of the financial report enclosed in this Annual report.
All the directors attended the board meeting for the review of this Report.
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 2023-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.
Table of Contents
I.Important Notice, Table of contents and Definitions
II. Company Profile & Financial Highlights.
III. Management Discussion & Analysis
IV. Corporate Governance
V. Environmental & Social Responsibility
VI. Important Events
VII. Change of share capital and shareholding of Principal Shareholders
VIII. Situation of the Preferred Shares
IX. Corporate Bond
X. Financial Report
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.Auditing Report of Chongqing Jianshe Vehicle System Co., Ltd.(DHSZ[2023]No.003251).
IV. Special explanation (No. 003785- [2023]DHHZ)on the capital occupation of the controlling shareholder
and other related parties of Chongqing Jianshe Vehicle System Co., Ltd.
V. Auditing Report on Internal Control for Chongqing Jianshe Vehicle System Co., Ltd.
（DHNZ[2023]No.000267).
VI. Special review report on the situation of deposit and loan of Chongqing Jianshe Vehicle System Co., Ltd. from
the Military Equipment Finance Co., Ltd. ( DHHZ[2023]No.003789).
VII. Special verification opinion on the deduction of operating income of Chongqing Jianshe Vehicle System Co.,
Ltd. ( DHHZ[2023]No.003784).
VIII. The original copies of all company documents and the originals of announcements publicly disclosed on the
information disclosure medium designated by the CSRC during the reporting period.
Definition
Terms to be defined Refers to Definition
Company, the Company, Jianmo Stock,
Refers to Chongqing Jianshe Vehicle System Co., Ltd.
Jianshe Vehicle B
Shenzhen North Jianshe Motorcycle Co., Ltd. (predecessor of the
Shenjianmo Refers to
Company)
Jianmo B Refers to Chongqing Jianshe Motorcycle Co., Ltd. (predecessor of the Company)
Military Equipment Group（Southern China Military Equipment Group Co., Ltd. (China Southern Industry
Refers to
Group） 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
Jianshe Industry Refers to
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 System
Jianshe HANON Refers to
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.
Changan Industrial Refers to Chongqing Changan Industrial( Group) Co., Ltd.
Yunnan Xiyi Refers to Yunnan Xiyi Industrial Co., Ltd.
Luoyang Northern Refers to Luoyang Northern Enterprise Group Co., Ltd.
Dajiang Industrial Refers to Chongqing Dajiang Industrial 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.
Chongqing Wanyou Refers to Wanyou Automobile Investment Co., Ltd.
In 2015,The company has made an agreement to sale the 100% stake of
Jianshe Mechanical and Electric Company-the company’s subsidiary
Major asset restructuring Refers to
funded by the liabilities and the motorcycle business related assets held
by the company to Military Equipment Group.
II. Company Profile & Financial Highlights.
Ⅰ. Company Information
Stock ID Jianshe Vehicle B Stock Code 200054
Modified stock ID (if any) Jianmo B
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 in
建车 B
Chinese (if any)
Company Name in English Chongqing Jianshe Vehicle System Co., Ltd
Short form of Company Name in
JSVS-B
English (if any)
Legal representative Yan Xuechuan
Registered address No.1 Jianshe Road, Huaxi Industrial Zone, Ba’nan District, Chongqing
Postal code of the Registered
400054
Address
On July 19, 1995, the first registered address was: Room 1802, Electronic Technology
Building, No.30 A, Shennan Middle Road, Shenzhen (office only); On September 29, 2000,
the registered address was changed to: Room 416, Electronic Building, No.2072, Shennan
Middle Road, Futian District, Shenzhen (office only); On July 26, 2002, the registered
Historical change of the
address was changed to: Room 1107, North Building, No.3003 Shennan Middle Road, Futian
company's registered address
District, Shenzhen (office only); On March 11, 2003, the registered address was changed to:
No.47, Xiejiawan Main Street, Jiulongpo District, Chongqing; On April 23,2009, the
registered address was changed to: No.1 Jianshe Road, Huaxi Industrial Zone, Ba’nan
District, Chongqing.
Office Address No.1 Jianshe Road, Huaxi Industrial Zone, Ba’nan District, Chongqing
Postal code of the office address 400054
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
Ⅲ. Information disclosure and placed
Internet website designated by CSRC for
publishing the Annual report of the Company http://www.szse.cn/
Newspapers selected by the Company for
Securities Times, Hongkong Commercial daily and htp://www.cninfo.com.cn
information disclosure
The place where the Annual report is prepared
Secretarial office of the Board
and placed
Ⅳ.Changes in Registration
Unified social credit 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
Changes in principal business activities since restructuring, stripped the main assets and liabilities involved in the motorcycle
listing (if any) business, completed the structural 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 Military Equipment Group and Jianshe Mechanical and
Changes is the controlling shareholder in the
Electric, Military Equipment Group shall transfer its 71.13% stake of the
past (is any)
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 Da Hua Certified Public Accountants (LLP)
Office address 1101,Building 7, 16 Xi Si Huan Zhong Road, Haidian District, Beijing
Names of the Certified Public Accountants as
Xu Shibao, Xie Jun
the signatories
The sponsor performing persistent supervision duties engaged by the Company in the reporting period.
□ Applicable √ Not applicable
The Financial advisor performing persistent 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
2022 2021 2020
year（％）
Operating revenue(Yuan) 474,114,098.08 680,118,967.08 -30.29% 740,851,845.25
Net profit attributable to the
shareholders of the listed -39,733,094.69 -25,998,962.72 -52.83% 1,415,942.45
company（Yuan）
Net profit after deducting of
non-recurring gain/loss
attributable to the shareholders -82,240,752.84 -29,668,201.39 -177.20% -44,041,022.22
of listed company（Yuan）
Net Cash flow generated by
12,409,599.09 21,432,367.47 -42.10% 165,013,126.67
business operation（Yuan）
Basic earning per
-0.33 -0.22 -50.00% 0.012
share(Yuan/Share)
Diluted gains per
share(Yuan/Share) -0.33 -0.22 -50.00% 0.012
Net asset earning ratio（%） -30.52% -16.10% -14.42% 0.82%
Changed over last
End of 2022 End of 2021 year（％） End of 2020
Gross assets（Yuan） 896,911,569.17 1,041,336,478.97 -13.87% 1,186,697,453.77
Net assets attributable to
shareholders of the listed 111,091,284.68 149,303,592.84 -25.59% 173,588,673.06
company（Yuan）
The lower of the company’s net profit before and after the deduction of non-recurring gains and losses in the last
three fiscal years is negative, and the auditor's report of the previous year shows that the Company’s going
concern ability is uncertain.
□ Yes √No
The lower of the net profit before and after the deduction of the non-recurring gains and losses is negative.
√ Yes □ No
Items 2022 2021 Remarks
RMB 1,272,403.54 for sales materials
income; RMB 1,236,355.99 for
Artificial support income; RMB
Operating income（Yuan) 474,114,098.08 680,118,967.08
474,716.54 for Power energy Income
and RMB
868,685.37 for other income.
RMB 1,272,403.54 for sales materials
income; RMB 1,236,355.99 for
Amount of operating income Artificial support income; RMB
3,852,161.44 16,214,107.75
deduction (yuan) 474.716.54 for Power energy Income
and RMB 868,685.37 for other
income.
RMB 1,272.403.54 for sales materials
income; RMB 1,236,355.99 for
Operating income after Artificial support
470,261,936.64 663,904,859.33
deduction(Yuan) income;RMB474,716.54 for Power
energy Income and RMB868,685.37
for other income.
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 122,064,712.94 117,066,749.90 113,413,771.40 121,568,863.84
Net profit attributable
to the shareholders of 23,445,211.84 -10,039,273.60 -20,684,911.30 -32,454,121.63
the listed company
Net profit after
deducting of non-
recurring gain/loss
attributable to the -15,884,430.93 -12,295,238.80 -21,587,216.80 -32,473,866.31
shareholders of listed
company
Net Cash flow
generated by business 22,875,680.64 8,513,551.90 15,072,374.40 -34,052,007.85
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 (2022) Amount (2021) Amount (2020) Note
Non-current asset disposal gain/loss(including the
write-off part for which assets impairment provision is 40,420,431.93 1,566,473.14 -448,967.59
made)
Government subsidies recognized in current gain and
loss(excluding those closely related to the Company’s 205,826.00 1,583,305.16 4,466,559.88
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 714,393.28 200,000.00 88,468.57
taken depreciation test
Operating income and expenses other than the
aforesaid items 167,143.72 319,460.37 -1,496,366.67
Other gains/losses in compliance with the definition of
999,863.22
non-recurring gain/loss
Less: Influenced amount of income tax 76,894.55
Total 42,507,658.15 3,669,238.67 45,456,964.67 --
Details of other profit and loss items that meet the non-recurring profit and loss definition
□ Applicable√ Not applicable
None
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Companies 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/items as defined by the information
disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period.
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
III. Management Discussion & Analysis
I. Industry information of the Company during the reporting period
The Company shall comply with the disclosure requirements of automobile manufacturing-related industries in
the Guideline No.3 for Self-regulation of Listed Companies of Shenzhen Stock Exchange-Industry Information
Disclosure.
1. Overall situation of automobile industry
In 2022, although affected by many unfavorable factors such as the structural shortage of chips, the high
price of power battery raw materials, and the geopolitical conflicts, under the effective pull of a series of stable
growth and consumption promotion policies such as halving the purchase tax, the overall recovery of China's
auto market was improved under adversity, achieved positive growth and showed strong development resilience.
According to data from the China Association of Automotive Industry Statistics, the automobile production and
sales in 2022 were 27.02 million units and 26.86 million units respectively-a YOY increase of 3.4% and 2.1%,
maintaining a slight increase for two consecutive years. Thereinto, driven by the substantial growth of new
energy vehicles, the passenger car market sold 23.566 million units for the whole year, a YOY increase of
9.69%. In 2022, the cumulative sales of new energy vehicles was 6.887 million units, a YOY increase of 95.6%,
and the cumulative sales of fuel vehicles were 16.676 million units, a YOY decrease of 7.15%. The share of
new energy vehicles in the passenger car market increased from 16.39% in the previous year to 29.23%, and the
share of fuel vehicles in the passenger car market decreased from 83.61% in the previous year to 70.77%.
2. Analysis of automobile air conditioning compressor industry
The automotive air conditioning compressor industry closely follows the development of the automotive
industry. Thereinto, the fuel vehicle compressor market is based on the huge number of fuel vehicles, yet in the
next few years the non-electric compressor products will still maintain a large scale space, but with the rapid
growth of new energy vehicles, it will promote the synchronous growth of the electric compressor market and
gradually squeeze the traditional fuel vehicle air conditioning compressor market share, and the main fuel
automobile plants will continue to certainly reduce the vehicle production in different degrees, thus the
oversupply of the traditional fixed displacement compressor will be the mainstream phenomenon of the market
in the coming period.
The air conditioning compressor is an important part of the automotive air conditioning system and is the
power source for the refrigerant to circulate within the system. The air conditioning system of traditional fuel
vehicles is driven by automobile engines to enable it worksby air conditioning compressor, and the main
domestic products are swash plate type, scroll type, rotary vane type and other technologies. The air
conditioning system of new energy vehicles drives the air conditioning compressor to work by driving the
motor. As the scroll compressor has high efficiency, and the high speed bearing capacity is comparatively better
matched with the high-speed motor, thus in the future the electric scroll compressor will have a broad
application prospect.
The Company's automotive air conditioning compressor products are mainly rotary vane technology,
which has been enhanced in 20 years since from the introduction, digestion and absorption and has been
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
independently innovated. From the industry development trend, the rotary vane technology will face the ceiling,
and the Company urgently needs to accelerate the digestion and introduction of new technology products such
as electric vortex.
II.Main Business the Company is Engaged in During the Report Period
The Company shall comply with the disclosure requirements of automobile manufacturing-related industries in
the Guideline No.3 for Self-regulation of Listed Companies of Shenzhen Stock Exchange-Industry Information
Disclosure.
The year of 2022 is the year of the full implementation of the Company's "14th Five-Year Plan", during
which the Company has faced unfavorable factors such as high temperature power curb, shortage of goods and
supply in the automotive industry chain, and faced the impact of rapid and substantial transformation of the
automotive market structure and the challenge of efficient transformation of scientific research achievements.
Under the complex operating environment and development pressure, the Company took multiple measures to
make steady progress, completed the production of 924,000 automotive air conditioning compressors and the
sales of 1.198 million units, a YOY decrease of 49% and 30.8% respectively, and achieved the operating
income of 474 million yuan, a YOY decrease of 30.3%.
(1) Strengthening the market tackling of tough problems and adjusting and optimizing the market structure.
The first aspect was in the compressor of new energy market. The Company successfully obtained the
supply qualification of new energy electric compressor for Changan Automobile production base, and possessed
the qualification to participate in the bidding of new projects and had the platform borrowing advantage in
Changan market. It successfully obtained 11 designated projects of Geely Automobile and Jianghuai Songzhi.
The second was the traditional market aspect of compressors. It successfully expanded 6 projects including
STELLANTIS and Baoding Changan Bus Company, and continued to supplement traditional sales; Three new
large-displacement customers such as GSJ in the Philippines have already achieved order delivery. The offline
market achieved an increase, with 25 newly increased dealers and the achieved sales of 121,000 units, a YOY
increase of 47.8%.
The third was the motorcycle parts market. The carburetor business remained basically stable, with sales of
269,000 units/sets for the whole year, a YOY decrease of 6.7%; The EFI business made substantial
breakthroughs, with annual sales of 17,500 sets; the competitiveness of EFI core parts was prominent, and the
annual sales volume of throttle bodies was 279,000 units/set, a YOY increase of 38.4%; The self-developed
brushless oil pump completed the first market order, and the electromechanical injection system entered the
customer verification stage.
(2) Improving the scientific and technological innovation system, promoting the research and development
of new products and the transformation of scientific and technological achievements.
The first was to further consolidate the construction of scientific and technological innovation platforms.
The Automotive Thermal Management System Research Institute was established to optimize the allocation of
multi-level talent structure and strengthen the construction of scientific and technological teams. Mechanisms
11
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
such as project research transformation, scientific and technological talent management, and project incentive
have been established. The in-depth promotion of industry-university-research cooperation has been carried out,
a number of research results have been applied, and three technical research projects at the municipal and
district levels have achieved results.
Second, the research and development of new products has achieved results. The four platform products of
electric compressors have basically been built. The 36CC electric compressor completed the product design,
and the 45CC electric compressor completed the design and realized the prototype assembly and evaluation,
forming a 18CC, 27CC, 36CC and 45CC product lineage, covering a full range of new energy electric vehicles.
The key technology of scroll compressor pump body has achieved breakthroughs, and the optimization design
of profile line, dynamic balance research and optimization, and the performance improvement of electric
compressors have achieved phased results. The independent research and development of the controller has
achieved a product breakthrough, and the research on motor electronic control optimization matching
technology has initially solved the problem of the technical neck of the core components of the electric
compressor. The scientific and technological achievements have continued to emerge, and 33 patents have been
applied, including 18 invention patents.
(3) Promoting the improvement of quality and efficiency, and continuously improving the level of
operation and management.
The first was to further promote the action of improving the quality of economic operation. The Company
vigorously implemented the 2022 quality and efficiency improvement plan, solidly promoted the "4+1" action
of "stable growth, risk prevention, promotion of reform, and strong party building", and greatly improved the
quality of operation and scientific management. The Company successfully passed the re-evaluation of high-
tech enterprise for the fourth time, was rated as a "specialized, refined and new" enterprise in Chongqing, and
successfully passed the re-evaluation of Chongqing technological innovation demonstration enterprises and
obtained a good grade.
The second was to improve the management level to world-class and complete the target tasks. It
vigorously promoted the modernization of the management system and management capabilities, and solidly
carried out management benchmarking in 15 areas. In the past three years, it has achieved remarkable results in
benchmarking and improvement, and has won 24 management achievement awards, including 4 third prizes of
China National Defense Industry Enterprise Association, 6 first prizes, 5 second prizes and 4 third prizes of
Chongqing Enterprise Management Modernization Innovation Achievements, 1 first prize, 2 second prizes and
2 encouragement awards of the first grassroots management innovation achievements of Ordnance Equipment
Group.
Third, the lean management has been further promoted. It has implemented the lean manufacturing
CSPS3.1 of Ordnance Equipment Group, which was rated as B- grade in lean evaluation of Ordnance
Equipment Group, and it has built two lean benchmark lines of dynamic and static disk machine processing line
and 36CC electric compressor assembly line, promoted and applied 6 lean cases and 3 best management
practices, and significantly improved the lean management leadership, on-site strength and productivity.
12
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Fourth, the quality management has reached a higher level. The construction of the quality system has been
vigorously promoted, the "1+N" system was smoothly integrated and the operation was effective, and it has
passed the IATF16949 certificate renewal audit, and the vehicle air conditioning company has passed the
supervision and audit; The Supplier Quality Competence Certification (QJS) system has been initially
established and gradually promoted; The "quality upward activity" has achieved practical results, among which
the primary pass rate of compressor inspection of electric compressors and the dynamic and static disk
configuration match rate have been significantly improved.
Fifth, the supply chain remained stable. The Company strengthened the stable supply, implemented special
management for bottlenecks, strengthened the tracking of imported parts resources, and ensured stable
production; It enhanced the capacity building of electric compressor supply, completed the development, trial
production and small-batch supply of more than 30 market electric compressor projects, started the trial
prototype productand sample delivery of key projects such as C673 and CPA, and initially built the
procurement channels and modes of electronic components.
(4) Coordinating development and security, and preventing risks well and effectively
The Company solidly promoted the "three-year action for special rectification of production safety", and
the Company's measures for the year of safety production improvement in 2022 were strong and effective, and
the three-year action has been successfully concluded; It tightened and consolidated the main body
responsibility, comprehensively and deeply carried out large-scale investigation and rectification of hidden
dangers of safety production risks and graded risk management and control, deepened source governance,
system governance and comprehensive management, and achieved the goal of zero major safety accidents.
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
Increase or Increase or
This reporting Same period decrease This reporting Same period decrease
period last year compared with period last year compared with
last year last year
By part category
Automotive air
conditioner 923758 1811146 -49.00% 1198092 1731479 -30.81%
compressor
According to the vehicle supporting
Automotive air
conditioner 1077417 1670325 -35.50%
compressor
According to after-sales service
Automotive air
conditioner 120675 61154 97.33%
compressor
Area
Domestic 567218 1294473 -56.18% 613338 1008512 -39.18%
Overseas 356540 516673 -30.99% 584754 722967 -19.12%
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Explanation of the reasons for the year-on-year change of more than 30%
√ Applicable □Not applicable
First, affected by multiple factors such as high temperature power rationing and the shortage by supply
chain of automobile OEMs, the Company's domestic trade and foreign trade have declined significantly.
Second, the rapid growth of new energy vehicles squeezed out the traditional fuel vehicle market, and the
sales of the Company's fuel vehicle air conditioning compressor products have declined, while the electric
compressor products have not yet formed an effective replacement.
Parts sales mode: The Company is mainly engaged in the production of automotive air conditioning
compressors, through the sale of products to automobile manufacturers or to the after-sales service market to
realize the product sales. Currently, the design production capacity of the Company's automotive air
conditioning compressor product is 2.4 million units, and the actual output in 2022 is 923,800 units, with a
capacity utilization rate of 38.49%; among them, the designed production capacity of electric compressors is
350,000 units, and the actual production volume in 2022 is 13,700 units.
The company conducts auto finance business
□ Applicable √Not applicable
The company conducts new energy vehicle related business
□ Applicable √Not applicable
III.Analysis On core Competitiveness
The Company shall comply with the disclosure requirements of automobile manufacturing-related industries in
the Guideline No.3 for Self-regulation of Listed Companies of Shenzhen Stock Exchange-Industry Information
Disclosure.
Product pedigree construction: On the basis of introducing the world's advanced technology, the Company
actively carries out independent innovation. After years of development, the product pedigree and technical
system are becoming increasingly complete; Including rotary vane compressor, swash plate fixed-displacement
and variable-displacement and electric compressor with complete intellectual property rights, forming five
product platforms of "rotary vane iron/aluminum, piston fixed/variable-displacement and electric compressor";
The products cover 18CC to 480CC displacement.
Innovation platform construction: The Company has built a "1+3+1" scientific and technological innovation
platform (national post-doctoral workstation+Chongqing Enterprise Technology Center, Chongqing Automobile
Thermal Management System Engineering Technology Research Center, Chongqing Automobile Air
Conditioning Compressor Key Laboratory+Chongqing Jiulongpo Innovation Center), which provides a strong
platform support for the transformation and upgrading of automobile thermal management products, the
development of applied basic research and innovative research on key technologies, the cultivation of scientific
and technological talents, and technological industrialization. The Company has established a Industry-University-
Research platform with China Automotive Engineering Research Institute, Shanghai Jiaotong University and
Chongqing Jiaotong University, mainly to study the working mechanism of compressors and noise optimization of
compressors, and to tackle key technical bottlenecks.
R&D capacity building: The Company has the largest and most functional experimental testing center for
automotive air-conditioning compressors in Southwest China. It has imported more than 50 sets of advanced
14
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
equipment for reliability test, system test, performance test and NVH test from abroad, with a value of more than
RMB 50 million, and has strong basic research capabilities, product development and design capabilities,
simulation and analysis capabilities and trial production and processing capabilities. In recent years, 12 major new
products in Chongqing have been approved, more than 20 provincial and ministerial level science and technology
awards have been won, and more than 200 patents have been applied for, including more than 40 invention
patents.
Manufacturing capacity building: it has the domestic first-class high-precision parts manufacturing base and
Chongqing municipal digital workshop. It possesses more than 40 parts machining production lines, more than
260 sets high-precision and high-quality processing equipment, and 9 product assembly lines. The equipment is
with a total value of more than RMB 650 million, and more than 80% of which are imported from Japan, the
United States, Germany, Switzerland, South Korea and other countries. The machining and assembly accuracy are
all micron-level, and MARPOSS online detection is widely used, so its machining accuracy and assembly
automation degree are at the leading level in China.
Quality capacity building: The Company always adheres to the tenet of "Quality first, customer oriented", and
is committed to running quality work through all aspects of the Company, and constantly improving product
quality, service quality and quality-price ratio. The Company has always continuously improved its management
ability, actively assumed social responsibilities, passed the IATF 16949 certified by DNV, an international
authoritative certification body, as well as OHSAS18001 and ISO14001 management system certification,
connected with international manufacturers, and introduced the general QSB+ quality management system, Ford
Q1 system, Changan QCA system and Nissan GK site management concept to continuously improve its
management level.
Talent team building: The Company has 70 scientific and technical personnel, including 901 R&D personnel
among 10,000 employees, of which 81.43% have bachelor degree or above, and 14.29% have senior
professional titles. Introduced 1 core talent and 5 mature talents of thermal management system. It has a
national postdoctoral workstation with 9 postdoctoral fellows.
IV.Main business analysis
1.General
This year, the company completed a production of 923,800 units and sold 1.1981 million units for its main
products, automotive air conditioner compressors, with a year-on-year decrease of 49% and 30.81% respectively.
The main business income was RMB 474 million, with a year-on-year decrease of 30.29%.
From the regional perspective, the domestic sales reached 613,300 units, the sales revenue reached RMB 286
million, Domestic sales revenue accounted for 60.33% of the company's main business income. The company sold
584,800 units in foreign trade throughout the year, realized a sales income of RMB 188 million, Foreign trade
sales accounted for 39.67% of the company's main business income.
From the perspective of sales model: the vehicle supporting model of automotive air conditioning
compressor achieved sales revenue of 379 million yuan, accounting for 79.89% of the Company's operating
income. The after-sales service market model of automotive air conditioning compressors achieved sales
revenue of 30 million yuan, accounting for 6.23% of the Company's operating income. Other businesses and
products achieved sales revenue of 66 million yuan, accounting for 13.88% of the Company's operating income.
15
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
From the perspective of customer structure: The total sales to the Company's top five customers was 321
million yuan, accounting for 67.71% of the Company's operating income.
2. Revenue and cost
(1)Component of Business Income
In RMB
2022 2021 Increase
Amount Proportion Amount Proportion /decrease
Total operating
474,114,098.08 100% 680,118,967.08 100% -30.29%
revenue
On Industry
Auto and Motorcycle
470,261,936.64 99.19% 663,904,859.33 97.62% -29.17%
parts
Other 3,852,161.44 0.81% 16,214,107.75 2.38% -76.24%
On products
Auto and Motorcycle
470,261,936.64 99.19% 663,904,859.33 97.62% -29.17%
parts
Other 3,852,161.44 0.81% 16,214,107.75 2.38% -76.24%
On Area
Domestic 286,054,392.55 60.33% 446,501,269.49 65.65% -35.93%
Overseas 188,059,705.53 39.67% 233,617,697.59 34.35% -19.50%
Sub-sale model
Vehicle supporting
mode of vehicle air
378,774,852.60 79.89% 586,606,478.18 86.25% -35.43%
conditioning
compressor
Vehicle air
conditioning
compressor after- 29,526,845.35 6.23% 18,773,105.22 2.76% 57.28%
sales service market
model
Other business and
product market 65,812,400.13 13.88% 74,739,383.68 10.99% -11.94%
models
(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/dec
Increase/decreas rease of
Increase/decreas
e of business gross profit
Gross e of revenue in
cost over the rate over the
Turnover Operation cost profit the same period
same period of same period
rate(%) of the previous
previous year of the
year(%)
(%) previous
year (%)
On Industry
Auto and
470,261,936.64 448,590,807.18 4.61% -29.17% -21.82% -8.97%
Motorcycle parts
On products
Auto and
470,261,936.64 448,590,807.18 4.61% -29.17% -21.82% -8.97%
Motorcycle parts
On Area
16
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Domestic 286,054,392.55 264,677,351.39 7.47% -33.52% -25.31% -10.18%
Overseas 188,059,705.53 185,718,083.91 1.25% -19.50% -15.36% -4.82%
Sub-sale model
Vehicle
supporting mode
of vehicle air 378,774,852.60 359,799,456.65 5.01% -35.43% -28.27% -9.48%
conditioning
compressor
Vehicle air
conditioning
compressor after- 65,812,400.13 61,069,133.30 7.21% -11.94% -11.45% -0.52%
sales service
market model
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 2022 2021 Changes
Sales Ten thousand sets 119.81 173.15 -30.81%
Vehicle air Production Ten thousand sets 92.38 181.11 -49.00%
conditioner
Stock Ten thousand sets 25.38 52.80 -51.94%
Explanation for a year-on –year change of over 30%
√ Applicable □Not applicable
First, affected by multiple factors such as high temperature power rationing and the shortage by supply
chain of automobile OEMs, the Company's domestic trade and foreign trade have declined significantly.
Second, the rapid growth of new energy vehicles squeezed out the traditional fuel vehicle market, and the
sales of the Company's fuel vehicle air conditioning compressor products have declined, while the electric
compressor products have not yet formed an effective replacement.
(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
2022 2021
Proportion in the Proportion in Increase/Decrea
Industry Items
Amount operating costs Amount the operating se (%)
(%) costs (%)
Direct
Industry 354,704,487.88 78.75% 553,036,721.80 94.23% -35.82%
material
Fuel and
Industry 9,888,828.55 2.20% 12,670,289.73 2.16% -21.95%
energy
Industry Staff salary 27,582,981.67 6.12% 31,052,496.10 5.29% -11.17%
Manufacturin
Industry 53,725,630.15 11.93% 64,289,680.17 10.95% -16.43%
g cost
(6)Whether Changes Occurred in Consolidation Scope in the Report Period
□ Yes √No
17
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
(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
Total sales amount to top 5 customers (Yuan) 321,029,999.90
Proportion of sales to top 5 customers in the annual sales(%) 67.71%
Proportion of the sales volume to the top five customers in the
13.06%
total sales to the related parties in the year
Information of the Company’s top 5 customers
No Name Amount(RMB) Proportion(%)
1 Customers1 182,404,119.25 38.47%
2 Customers 2 61,925,471.97 13.06%
3 Customers 3 26,610,054.40 5.61%
4 Customers 4 26,446,940.20 5.58%
5 Customers 5 23,643,414.08 4.99%
Total -- 321,029,999.90 67.71%
Other explanation :
√ Applicable □Not applicable
Chongqing Changan Automobile Co., Ltd. The company's controlling shareholder, Military Equipment Group,
holds 40.70% of its shares), 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 2022 First provisional General Meeting of Shareholders for review and approval.
The company's directors, supervisors, senior managers, key technical personnel and shareholders holding more
than 5% (not including the Military Group) do not direct or indirect interests in the major suppliers of the above-
said suppliers.
Principal suppliers
Total purchase of top 5 Suppliers（Yuan） 127,946,861.11
Percentage of total purchase of top 5 suppliers In total annual
0.00%
purchase(%)
Proportion of purchase amount from the top 5 suppliers in the
30.05%
total purchase amount from the related parties in the year
Information about the top 5 suppliers
No Name Amount（Yuan） Proportion
1 Suppliers 1 58,213,770.80 13.67%
2 Suppliers 2 23,785,219.55 5.59%
3 Suppliers 3 19,304,053.05 4.53%
4 Suppliers 4 13,838,564.52 3.25%
5 Suppliers 5 12,805,253.19 3.01%
Total -- 127,946,861.11 30.05%
Other explanation :
√ Applicable □ Not applicable
The company's directors, supervisors, senior managers, key technical personnel and shareholders holding more
18
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
than 5% do not direct or indirect interests in the major suppliers of the above-said suppliers.
3.Expenses
In RMB
2022 2021 Increase/Decrease(%) Note
Sale expenses 15,239,315.12 16,795,778.20 -9.27%
Administration
expenses 47,721,110.67 62,047,629.17 -23.09%
Financial expenses 17,472,245.88 23,014,845.65 -24.08%
R & D expenses 30,598,868.69 29,760,773.46 2.82%
4.R& D Investment
√Applicable □Not applicable
Expected impact on the
Name of main R&D
Project purpose Project progress Goal to be achieved future development of
project
the Company
Improve product
First, continue to
performance and tackle
upgrade technology,
with the upgrading and
and the basic research
development of
project entered the
automobile technology; Improve the
final stage at the end of
consolidate the vitality Improve refrigeration competitiveness of fix-
the year. Second,
Technical direction of of products, deal with efficiency; optimize displacement
continue to carry out
traditional compressor the upgrading of noise; and optimize compressors and
design cost reduction
automobile manufacturing costs. stabilize the scale
to achieve the goal of
consumption; position of the industry
cost reduction. Third,
consolidate product
the market project has
competitiveness and
been achieved on
solve key technical
schedule.
problems.
The 27CC products
Realize the vertical achieve mass
integration upgrade of production targets, the Enhance product
product technology Supplement the new
Technical direction of 36CC products achieve competitiveness and
based on the product energy compressor
electric compressor small batch production, achieve large-scale
position and market product lineage.
position of traditional and the 45CC products breakthroughs
compressors. achieve design
finalization.
Construction and
simulation of the
Upgrade the product technical architecture With electric
Establish the technical
Technical direction of horizontal integration, of heat pump air compressors as the
capability of matching
thermal management focusing on system conditioning system, core, build heat pump
system matching and heat testing of air
and establishment of air conditioning system
pump technology. conditioning systems.
enterprise thermal integration capabilities.
management system
enterprise standards.
Actively cultivate and The EFI system Develop new products
Improve the
Direction of EFI develop new products achieve recognition by such as EFI systems
system such as EFI system and competitiveness of the
market customers and and gasoline pumps to
oil pump. Company.
achieve mass sales. promote scale growth
Company's research and development personnel situation
2022 2021 Increase /decrease
Number of Research and
Development persons 70 70 0.00%
(persons)
Proportion of Research and
9.00% 8.83% 0.17%
Development persons
19
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Academic structure of R&D personnel
Bachelor 52 50 4.00%
Master 5 2 150.00%
College 13 18 -27.78%
Age composition of R&D personnel
Under 30 years old 23 17 35.29%
30-40 years old 17 21 -19.05%
Over 40 years old 30 32 -6.25%
The Company's R & D investment situation
2022 2021 Increase /decrease
Amount of Research and
Development Investment 30,598,868.69 29,760,773.46 2.82%
(Yuan)
Proportion of Research and
Development Investment of 6.45% 4.38% 2.07%
Operation Revenue
Amount of Research and
Development Investment 0.00 0.00 0.00%
Capitalization (Yuan)
Proportion of Capitalization
Research and Development
Investment of Research and 0.00% 0.00% 0.00%
Development Investment
Reasons and influence of significant changes in R&D personnel composition of the Company
√Applicable □Not applicable
The increase in master's degree personnel and the increase in R&D personnel under 30 years-old are due to
the establishment of the Automotive Thermal Management System Research Institute to optimize the multi-
level talent structure allocation and strengthen the construction of scientific and technological teams. In 2022,
the introduction of professional and technical talents and the recruitment of college graduates were strengthened.
The Reason of the Prominent Change in Total Amount of Research and Development Input Occupying the
Business Income Year on Year
√ Applicable □ Not applicable
The proportion of total R&D investment in operating income increased from the previous year, which was
firstly due to the Company's continuous increase in R&D project investment, the R&D investment in 2022 was
30.599 million yuan, an increase of 2.82% over the previous year and the second was due to the YOY decrease
in operating income in 2022.
Reasons for the drastic change of capitalization rate of R&D investment and its rationality explanation
□ Applicable √Not applicable
5.Cash Flow
In RMB
Increase/Decrease(
Items 2022 2021
%)
Subtotal of cash inflow received from
operation activities 477,842,991.85 603,828,235.81 -20.86%
Subtotal of cash outflow received from
operation activities 465,433,392.76 582,395,868.34 -20.08%
Net cash flow arising from operating activities 12,409,599.09 21,432,367.47 -42.10%
Subtotal of cash inflow received from investing 153,543,148.36 1,609,454.58 9,440.07%
20
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
activities
Subtotal of cash outflow for investment
26,166,782.57 12,003,935.51 117.99%
activities
Net cash flow arising from investment
127,376,365.79 -10,394,480.93 1,325.42%
activities
Subtotal cash inflow received from financing
732,591,828.08 716,824,318.47 2.20%
activities
Subtotal cash outflow for financing activities 726,114,182.90 783,421,725.44 -7.32%
Net cash flow arising from financing activities 6,477,645.18 -66,597,406.97 109.73%
Net increase in cash and cash equivalents 146,256,010.86 -55,571,730.36 363.18%
Notes to the year-on-year change of the relevant data
√Applicable □ Not applicable
The decrease in net cash flow from operating activities was due to the lower product sales and lower
revenue during the year.
The increase in net cash flow from investing activities was due to the transfer of assets such as Plant 106.
The increase in net cash flow from fund-raising activities was due to the structural adjustment of fund-raising.
The increase in net cash and cash equivalents was due to an increase in net cash flows from investing activities.
Reasons for the significant difference between the net cash flow generated by the Company's operating
activities during the reporting period and the net profit of this year
□ Applicable √Not applicable
V. Main business analysis
√ Applicable □ Not applicable
In RMB
Proportion in total Sustainable
Amount Explanation of cause
profit (yes or no)
The operating income of the
Investment income 8,128,052.32 20.24% Company's joint venture Yes
Jianshe HANON
Change in fair value,
0.00 0.00%
profit and loss.
Impairment of assets 0.00 0.00%
Non-operating income 170,256.15 0.42% No
Non-operating
3,112.43 0.01% No
expenses
Mainly due to the Company
completed the transfer of its
plant106, the corresponding
Income from asset land use right and related
40,420,431.93 100.66% No
disposal ancillary machinery and
equipment, and realized the
asset disposal gain of 39.02
million yuan.
Credit impairment
989,437.83 2.46% No
losses
21
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
VI. Condition of Asset and Liabilities
1.Condition of Asset Causing Significant Change
In RMB
End of 2022 End of 2021 Notes to
Proportion the
Proportion in Proportion in increase/d significa
Amount the total Amount the total ecrease nt
assets(%) assets(%) change
Monetary fund 179,954,522.99 20.06% 91,678,523.19 8.80% 11.26%
Accounts
113,710,214.72 12.68% 149,333,285.64 14.34% -1.66%
receivable
Inventories 131,860,572.93 14.70% 206,719,605.79 19.85% -5.15%
Long-term equity
210,112,321.04 23.43% 201,984,268.72 19.40% 4.03%
investment
Fixed assets 202,039,143.80 22.53% 216,541,481.98 20.79% 1.74%
Construction in
process 989,429.96 0.11% 1,811,125.46 0.17% -0.06%
Short-term loans 546,603,500.00 60.94% 493,460,000.00 47.39% 13.55%
Contract
3,441,205.38 0.38% 2,868,604.98 0.28% 0.10%
liabilities
Overseas assets account for a relatively high proportion.
□ Applicable √ Not applicable
2.Asset and Liabilities Measured by Fair Value
□ Applicable √ Not applicable
3. Restricted asset rights as of the end of this Reporting Period
Items End of Book value Reason
Monetary fund
9,959,988.94 Bank acceptance bill security deposit
Financing receivable
7,820,000.00 Pledeg
Total
17,779,988.94
VII. Investment situation
1. General
√ Applicable □Not applicable
Investments made in the Reporting Investments made in the prior year
Increase/Decrease(%)
Period（\Yuan） (Yuan)
29,867,100.00 16,378,740.18 82.35%
2.Condition of Acquiring Significant Share Right Investment during the Report Period
□ Applicable √ Not applicable
3.Situation of the Significant Non-equity Investment Undergoing in the Report Period
√ Applicable □ Not applicable
In RMB
22
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Accrued Actual Accrued Reasons for
Industry
Invest Fixed Investment Realized not Reaching
involved Investment Anticipa
Project ment investm Amount up to Capital Project Income up the Planned Disclosure
in amount in this ted Disclosure Index
date
name meth ents or the End of Source schedule to the End Schedule and
investmen reporting period income
od not Reporting of Reporting Anticipated
t projects
Period Period Income
Constructi
on project
of See on
dynamic Automoti www.cninfo.com.cn
ve air Trial
and static company
Self- conditione production January
disk Yes 985,200.00 8,072,200.00 Self funds 100.00% 0.00 0.00 announcement on
built r began in May 19,2021
productio compresso Announcement No.:
2022
n line of r industry 2021-001 and 2022-
electric 004
compresso
r
36CC See on
scroll Automoti www.cninfo.com.cn
electric ve air It has entered company
compresso Self- conditione August
Yes 17,958,000.00 18,083,000.00 Self funds 100.00% 0.00 0.00 small batch announcement on
r assembly built r 28,2021
line compresso production Announcement No.:
constructi r industry 2021-049 and 2022-
on project 004
Electric See on
Automoti www.cninfo.com.cn
compresso The
ve air company
r
Self- conditione equipment has August
experimen Yes 4,838,000.00 6,065,000.00 Self funds 100.00% 0.00 0.00 announcement on
built r been put into 28,2021
t ability Announcement No.:
compresso use
improvem 2021-049 and 2022-
r industry
ent project
004
Sporadic Automoti See on
ve air
fixed Self- Has been put January 22, www.cninfo.com.cn
Yes conditione 6,085,900.00 6,085,900.00 Self funds 90.83% 0.00 0.00
assets built into use 2022 company
r
investmen compresso announcement on
23
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
t r industry Announcement No.:
2022-004
Total -- -- -- 29,867,100.00 38,306,100.00 -- -- 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
VIII. Sales of major assets and equity
1.Situation of Significant Asset Sale
√ Applicable □ Not applicable
Net profit Whether it is
Percentag
contributed Whether implemented
e of the Related Whether
by the asset the as planned or
Trans net profit relationship all the
to the listed property not, if it is not
actio contribute Asset Whether with creditor’s
Asset company Impact of the rights of implemented
Coun n d by the Sale it is a counterparty rights and
s Sale from the sale on the the assets as planned, Disclosure Disclosure
terpar price asset sale Pricing related (applicable debts
being date beginning Company involved the reasons date Index
ty (’000 to the total Principl party to related involved
sold of the (Note 3) have been and the
0 net profit e transacti party have been
current fully measures the
yuan) of the on transactions transferre
period to transferre Company has
listed ) d
the date of d taken should
company
sale (’0000 be explained
24
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
yuan)
In order to
revitalize idle
assets and
improve the
efficiency of
asset
operation, the See details in
Build
company the company’s
ings,
implemented announcement
land
asset transfer, published on
use
Jians Febru and the funds securities times,
rights The Controlled
he ary 15,28 obtained are Implemented February Hongkong
and 0 -99.01% assessed Yes by the same Yes Yes
Indus 15,20 8 planned to be as planned 19,2022 Commercial
mach value party
try 22 used to repay daily and
inery
part of the http//www.cninf
and
debt, as well o.com.cn
equip
as to (Announcement
ment
strengthen the No.:2022-015)
Company's
manufacturing
capacity
building and
R&D capacity
building.
2.Sales of major equity
□ Applicable √ Not applicable
IX. 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 10,000
25
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Company Registered
Company type Sectors engaged in Total assets Net assets Turnover Operating profit Net Profit
Name capital
Air Conditioner Production and sales of automotive
Subsidiaries 16000 80,368.19 19,856.18 41,014.63 -6,302.43 -6,294.47
Co. air conditioners
Production and sales of motorcycles
Pingshan Taikai Shareholding 8355 9,812.85 8,346.31 6,099.42 612.97 605.56
and parts
company
Jianshe Shareholding Production and sales of Automobile
42000 52,206.35 41,710.79 25,456.21 1,755.24 1,625.61
HANON company Thermal Energy Management system
26
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Acquirement and disposal of subsidiaries in the Reporting period
□ Applicable √ Not applicable
Note
The wholly-owned subsidiary Automotive Air Conditioning is mainly engaged in the production and sales of
fixed-displacement compressors for automotive air conditioners. With the increase of market share of new energy
vehicles, the fixed-displacement compressor market has further declined. In 2022, 1.1981 million air-conditioning
compressors were sold, with a year-on-year decrease of 30.81%, and the operating income was RMB 410.15
million, with a year-on-year decrease of 35.63%.
The wholly-owned subsidiary Pingshan Taikai is mainly engaged in the production and sales of carburetor
and parts for engines. In 2022, it made an effective breakthrough in the development and marketing of new
products, achieving a sales of 270,000 carburetors, 300,000 EFI and parts, and 460,000 auto parts, with a year-on-
year decrease of 7%, an Increase of 30% and an Increase of 5% respectively, and achieving an operating income
of RMB 60.99 million, with a year-on-year increase of 16.85%.
The joint venture Jianshe HANON is mainly engaged in the production and sales of variable displacement
compressors. Affected by the power curtailment in Chongqing and the supply chain transmission by restricted
chips supply of customers，it sold RMB 254.56 million variable displacement compressors in the whole year,
with a year-on-year decrease of 8.77%, achieving an operating income of RMB 254.56 million, with a year-on-
year decrease of 16.98%.
X．Structured vehicle controlled by the Company
□ Applicable √ Not applicable
XI. Prospect for future development of the Company
(I) Overall development trend of the industry and opportunities and challenges faced by the Company
From the perspective of the economic situation, China's economy will gradually shift to an innovation-
driven, high-quality growth mode in the future, and the growth rate will gradually slow down. The
transformation of economic growth mode will continue to support the growth of automobile sales, but the
external anti-globalization supply chain crisis, as well as the triple pressure of domestic demand contraction,
supply shock, and expected weakening will remain relatively large, the trend of automobile consumption may
deviate from the economic growth in the short term.
From the perspective of industry development, in terms of policies, the industrial policies will continue to
guide the transformation of the "new four modernizations" of the automotive industry, and new energy vehicles
have formed a scale under the traction of policies such as direct subsidies and double credits. In terms of
technology, the vehicle electrification and intelligent technology have become a trend and will reshape the
automotive industry chain. In terms of the market, the vehicle sales in 2022 was 26.86 million units, and sales in
2023 are expected to be remain flat compared in 2022, and the new energy vehicles are expected to exceed 8
million units.
From the perspective of company development, the Company is facing a complex operating environment
and development pressure. First, for the traditional compressor products, the market competition pressure is
large and the scale is shrunk. Second, the core competitiveness of new energy electric compressors is not strong,
27
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
and it has not yet formed a scale effect in the mainstream passenger car market, and it cannot form an effective
support for the Company's development. Third, the key core technologies still need to be vigorously tackled,
and the speed of product innovation needs to be further accelerated. Fourth, the talent team structure is not
excellent, there is a lack of high-end leading talents, and the task of promoting the high-quality development of
the Company is arduous and long.
(II) Company development strategy
The Company unswervingly strengthens the strategic guidance and effectively promotes the steady
implementation of the "136" strategy. With the vision of "building a first-class scientific and technological
innovation enterprise with international competitiveness", focusing on "leading by science and technology,
driven by innovation", and aiming at "multiplying scale, benefit, and efficiency", we will vigorously implement
a number of measures such as "deepening reform and adjustment, leading the development of compressors,
innovating and developing thermal management systems, reforming and developing parts, and strengthening
party building". It willaccelerate the construction of scientific and technological innovation enterprise, and
realize the overall positioning of the layout and industrialization of a full range of new energy vehicle thermal
management systems and compressors.
(III) Company's production and operation arrangement in 2023
In the 2023, the Company aims to achieve sales of 1.4 million automotive air conditioning compressors,
including 100,000 new energy electric compressors, with an operating income of 570 million yuan. In order to
achieve the annual goal, the Company will focus on the following aspects in 2023:
1. Accelerate the scientific and technological innovation, and promote the transformation and upgrading of
enterprise with technological product innovation
First, the Company will strengthen the construction of the innovation system. It will optimize the
development process, deepen technology benchmarking, give full play to the role of the existing "1+3+1"
innovation platform, actively carry out cooperative research on new industrial technology development with
universities, and improve independent innovation capabilities.
Second, it will accelerate the research and development of new products. The Company will enhance the
electric compressor technology platform to ensure that 36CC, 45CC and other electric compressor products are
mature and stable; Complete the integration of mass production products 18CC and 27CC and the existing
technology platform; Start pre-research work on larger displacement electric compressors; Promote the market
application of medium voltage autonomous controller platform products; Complete the design and development
of high-voltage platform controllers; Continue to vigorously develop heat pump air conditioning system
products. Accelerate the research and development of market projects, focus on Chang'an, Xiaokang, Jianghuai
and other customers’ market application projects, especially to ensure that Chang'an CPA projectwill be
completed on schedule. Continue to promote the product development of the electric injection system, lay the
foundation for the improvement of the emission standards of the general export machinery in 2024, and seize
the market opportunity.
28
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Third, it will accelerate the breakthroughs in key core technologies. The Company will further enhance
technology research of compressor pump body technology, new profile, flexible mechanism and other aspects,
and promote the breakthroughs of electric compressor core technology. Also, it will continue to carry out the
systematic research on heat pump air conditioning system construction and system matching testing, the
systematic research on natural and environmentally friendly working medium compressors, and build technical
capabilities of automotive thermal management products. It will systematically build experimental trial
production technical capabilities, strengthen experimental design and test analysis, and provide stable support
for product development.
2. Do well in tackling tough problems in the market and effectively improve the market scale efficiency
First, the Company will deeply explore the domestic market. In terms of the new energy market, it will
focus on Chang'an and expand the mainstream domestic new energy markets such as Great Wall and Geely; By
overall coordination, it will strengthen the market services, expand the market share of Ruichi and Hongrui. In
terms of traditional markets, we will strive for the implementation of new projects such as FAW-Volkswagen-
Jetta and Dongfeng Nissan Xuanyi; it will focus on existing fuel markets such as Changan and Great Wall, and
expand projects to achieve sales growth. In terms of offline market, it will accelerate the launch of new products,
expand offline product categories, and achieve scale upgrading; The Company will optimize the dealer
incentive mechanism, deepen dealer rating management, vigorously expand strategic dealers, and create an
offline large customer market. In terms of parts market, Pingshan Taikai will make every effort to grasp the
market expansion of carburetors and EFI systems, strengthen key large customer management, actively develop
new customers, strive to seek new increments, and ensure steady growth in operating income. The Casting
Machine Division will be fully committed to the development and supply of electric compressor parts, actively
expand the external market, improve the structure of business segments, and focus on improving in the overall
scale.
Second, the Company will use every effort to broaden the foreign trade channels. In the new energy market,
we will continue to deepen the cooperative relationship with Peugeot-Fiat and make every effort to break
through electric projects; With the help of Changan New Energy's overseas plan, it will accelerate the formation
of the second growth point of electric products. In terms of traditional markets, we will consolidate the Peugeot
market and strive for the SAIPAprojects in Iran and the Proton projects in Malaysia; the Company will
accelerate the speed of "going overseas" of traditional products, promote the transfer of the Company's
production line, gradually expand the single trade model into an overseas localized sales model, and expand
sales; Focusing on India, Southeast Asia, the Middle East and other markets, it will reconstruct the structure of
foreign trade customers. In terms of offline market, we will improve the ability to expand the network of
overseas dealers, expand the coverage of overseas after-sales dealers such as Taiwan Yongsheng and India's
Sanden, and increase the proportion of "going overseas" sales.
3. Strengthen the management benchmarking and effectively improve the management efficiency and
effectiveness
First, the Company will continue to carry out special actions to improve quality and efficiency. With the
index system as the traction, we will ensure the improvement of cash flow from operating activities and
improve operating profit. The Company will strengthen the overall budget management, highlight value
29
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
orientation, and promote the implementation of target responsibilities. Also, it will promote the whole value
chain and the whole process of cost control, actively optimize resource input and product structure layout, and
form the new growth points as soon as possible.
Second, it will continue to strengthen the joint venture control. The Company will fully fulfill the
responsibilities of shareholder, and promote the common strategy, goal and value direction of both parties to the
joint venture. It will actively promote the Construction Hanang's new car and modified car projects, increase
synergy with Changan Automobile and develop markets outside the system, solidly promote the localization of
parts, improve operation quality, and enhance the core competitiveness of enterprises.
Third, the Company will continue to deepen lean management. By continuously improving the lean
production system of the whole process and the whole supply chain, it will greatly improve the production
efficiency, promote the transformation and upgrading of the digital level of the production line, and build the
36CC lean demonstration production line into a demonstration production line with a high digital level; Plus, it
will continue to consolidate and improve the 6S management level and create a standard manufacturing
workplace, as well aspromote the "N+3" model of production planning to achieve accurate planning, smooth
production and economical costs.
Fourth, the Company will continue to strengthen technical management. Upon grasping the capacity
building of electric product engineering, it will ensure that the 36CC electric compressor production line and the
dynamic and static plate production have mass production capacity, and the controller assembly line forms mass
production capacity. Furthermore, it will carry out process optimization and focus on improving the production
efficiency of 18/27 electric compressor production lines and bearing housings. The Company will strictly
implement process management, increase the intensity of process implementation inspection, strengthen the
timeliness and effectiveness management of on-site problem handling, and ensure that the completion rate of
handling problems is 100%.
Fifth, the Company will continuously improve quality management. It will promote the construction of the
"1+N" quality system, carry out compliance reviews of the new energy sector, and ensure that the Company and
its subsidiaries of automotive air conditioning companies successfully pass the IATF16949 quality system
supervision and audit. Also, it will continue to promote the supplier quality competence certification (QJS),
continuously optimize and improve QJS standards, and continuously improve supplier quality assurance
capabilities. Furthermore, it will carry out quality supervision and control of the whole process of parts entering
the factory, manufacturing process and finished products leaving the factory to ensure that the physical quality
is controlled. We will continue to implement quality improvement activities and prioritize the plans, and
continuously promote quality improvement.
Sixth, it will continue to strengthen the supply chain management. The Company will stabilize the chain,
strengthen the chain, continue to optimize and adjust the traditional product supporting system, and ensure the
stability of the supply chain. It will build a chain and consolidate the chain, and accelerate the construction of
the new energy supply chain system, promote the collaborative development of suppliers, and build a solid and
reliable CPA and other key project guarantee and supply systems, especially to establish a procurement model
of electronic components with differentiate priorities, multiple channels and risk-prevention, and solidify the
chain.
30
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
4. Strict risk prevention and control, and effectively improve risk prevention and control capabilities
The Company will strengthen the risk prevention and control, improve the emergency plans, strengthen
process supervision, reduce risk impact, and control the occurrence of risks in view of major risks faced by the
Company's market competition, product structure adjustment and business quality improvement. Meanwhile, it
will improve the whole process and the whole chain risk prevention and control work system and working
mechanism, and build a long-term mechanism for early detection, early warning and early disposal. Also, it will
strengthen the contract performance and dispute response management to ensure that the Company's overall
legal compliance risk is controllable. Upon well building the general safety system, the Company will
continuously improve the level of intrinsic safety, and effectively curb the occurrence of accidents, as well as
reduce environmental pollution risk points and prevent the environmental emergencies.
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.
31
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
XII.Particulars about researches, visits and interviews received in this reporting period
√ Applicable □ Not applicable
Index of Basic
Types of Information on
Place of Way of Visitors
Reception time visitors Main contents discussed and information provided the
reception reception received
received Investigation
and Survey
Q: What is the impact of the company's listing transfer of the assets such as
factory buildings? A: The assets transferred by the company this time are the
production site of the original motorcycle business. After the company
implemented a major asset restructuring in 2015, this motorcycle production site
has been idle. In order to revitalize idle assets and improve the efficiency of asset Register of visit
February operation, the company implements asset transfer, and the funds obtained are ors for investors
The Company By phone Individual Mr.Zhang
23,2022 intended to be used to repay some debts and strengthen the company's of the company
manufacturing capacity building and R&D capacity building. After the transfer of
idle assets, there is no impact on the Company's current production and operation.
After the transaction is completed, the transaction costs of real estate, land, etc.
will be deducted from the transaction price, which after deduction will be
accounted as the asset disposal income.
Register of visit
Q: Does the controlling shareholder of the company have a plan to promote the
ors for investors
March 19,2022 Chongqing By phone Individual Ms.Liu reform of B shares? A: The company is not aware of the controlling shareholder's
of the company
plan for the company's B-share reform.
Q: Under the influence of the current pandemic, can the annual general meeting
of shareholders be held successfully? The controlling shareholder of the company Register of visit
shall actively promote the securitization of high-quality assets and actively plan ors for investors
May 5,2022 The Company By phone Individual Mr.Xu
the reform of converting B shares into A shares. A: The annual general meeting of of the company
shareholders will be held as scheduled. Thanks for the suggestion. The company
will pass the investor's suggestion to the controlling shareholder.
Q: The State-owned Assets Supervision and Administration Commission
(SASAC) issued opinions on improving the quality of listed companies
controlled by central enterprises. Did Jianshe Vehicle B, as a listed company
Register of visit
controlled by central enterprises, formulate a quality improvement plan? A: The
ors for investors
July 5,2022 The Company By phone Individual Mr.Xu company will actively implement the quality improvement requirements of
of the company
SASAC and China South Industries Group Corporation (CSGC), promote the
company to improve its governance and standardized operation, strengthen the
endogenous growth and innovative development of listed companies, and
promote the high-quality development of listed companies with practical actions.
32
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Register of visit
Q: What are the non outstanding shares in the company's share capital? A: The
November ors for investors
The Company By phone Individual Investor company's non outstanding shares belong to the promoters, and are currently held
1,2022 of the company
by four shareholders, including CSGC.
33
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
IV. Corporate Governance
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 Reportin
1.Annual General Meeting
34
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Investor
Sessions Type Meeting Date Disclosure date Disclosure index
participation ratio
It was reviewed and approved: 1.Proposal on 2022 Annual Investment Plan. 2.
The First Extraordinary Proposal on the 2022 Annual Financing Plan of Chongqing Jianshe Vehicle Air
Extraordinary shareholders’ Conditioning Co., Ltd., a wholly-owned subsidiary.3.. Proposal on Estimated
74.45% February 25,2022 February 26,2022
shareholders’ General General Daily Related Party Transactions in 2022. 4. Proposal on Estimated External
meeting in 2022 meeting Guarantee in 2022.5. Proposal on amending the Articles of Association.6.
Proposal on amending the Rules of Procedure of the Board of Directors.
It was reviewed and approved: 1. The Work Report of the Board of Directors
for 2021.2. The Work Report of Supervisors committee 2021.3.Annual Report
2021 Shareholders’ Annual General
74.45% May 27,2022 May 28,2022 for 2021 and its summary. 4. Profit distribution plan for 2021.5. Proposal for
general meeting Meeting
Hiring the Annual Financial Report Audit Agency of 2022. 6. Proposal on
accepting financial services and related transactions.
The Second Extraordinary
Extraordinary shareholders’
74.45% November 25,2022 November 26,2022 It was reviewed and approved: Proposal on changing accounting firms.
shareholders’ General General
meeting in 2022 meeting
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √Not applicable
V. Information about Directors, Supervisors and Senior Executives
1.Basic situation
Amount Amount
Shares of shares of shares Other Shares
held at the increased decreased changes held at
Office Starting date of Expiry date of
Name Positions Sex Age year- at the at the increase the year- Reason
status tenure tenure
begin(shar reporting reporting /decreas end(shar
e) period(sha period(sha e e)
re) re)
Yan Not
Chairman In office Male 59 November 13,2020 May 31,2023 0 0 0 0 0
Xuechuan applicable
Not
Fan Aijun Director In office Male 51 February 3,2021 May 31,2023 0 0 0 0 0 applicable
35
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Not
Dong Qihong Director In office Male 58 April 11,2019 May 31,2023 0 0 0 0 0 applicable
Not
Shi Qingong Director In office Male 50 May 28,2021 May 31,2023 0 0 0 0 0
applicable
Not
Hao Lin Director In office Male 59 April 29,2008 May 31,2023 0 0 0 0 0 applicable
Independent Not
Li Jiaming In office Male 57 May 22,2020 May 31,2023 0 0 0 0 0
Director applicable
Independent Not
Xie Fei In office Male 58 May 22,2020 May 31,2023 0 0 0 0 0
Director applicable
Independent Femal Not
Song Weiwei In office 47 May 22,2020 May 31,2023 0 0 0 0 0
Director e applicable
Independent Not
Liu Wei In office Male 58 May 22,2020 May 31,2023 0 0 0 0 0
Director applicable
Zhou Not
Director Appointed Male 50 May 25,2016 May 31,2023 0 0 0 0 0
Yongqiang applicable
Chairman of the
Not
Lu Xianyun supervisory In office Male 58 November 27,2020 May 31,2023 0 0 0 0 0
applicable
committee
Zhang Not
Supervisor In office Male 55 April 11,2019 May 31,2023 0 0 0 0 0
Lungang applicable
Not
Qiao Guoan Supervisor In office Male 58 April 11,2019 May 31,2023 0 0 0 0 0 applicable
Employee Not
Liao Jian In office Male 51 March 3,2021 May 31,2023 0 0 0 0 0
supervisor applicable
Employee Not
Su Qiang In office Male 36 November 29,2021 May 31,2023 0 0 0 0 0
supervisor applicable
Not
Fan Aijun GM In office Male 51 January 18,2021 May 31,2023 0 0 0 0 0
applicable
Secretary of the
Commission for Not
Xu Wanming In office Male 51 August 29,2022 0 0 0 0 0
Discipline applicable
Inspection
Not
Tan Mingxian Chief accountant In office Male 49 March 25,2019 May 31,2023 0 0 0 0 0
applicable
Not
Li Yongjiang Deputy GM In office Male 41 December 5,2021 May 31,2023 0 0 0 0 0 applicable
Zhou Not
Deputy GM In office Male 50 June 26,2022 May 31,2023 0 0 0 0 0
Yongqiang applicable
Not
Yu Wenbiao Deputy GM Dimission \Male 56 March 25,2019 May 31,2023 0 0 0 0 0
applicable
36
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Zhang Secretary of the Not
In office Male 35 May 17,2018 May 31,2023 0 0 0 0 0
Hushan Board applicable
Total -- -- -- -- -- -- 0 0 0 0 0 --
37
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
During the reporting period, whether there is dismissal of directors and supervisors and decruitment of senior
executives
√ Yes □No
During the reporting period, The company has the resignation of directors and supervisors and the dismisssal of
Senior executives personnel during their term of office. For details, please refer to the following
"Changes in the company's directors, supervisors and senior management personnel"
.Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Positions Types Date Reason
Due to work adjustment, he no longer
holds the post of deputy general
Yu Wenbiao Deputy GM Dismiss May 23,2022 manager of the company, and is
appointed as a senior consultant by the
company.
Zhou Adjust from the position of director to
Director Appointed June 24,2023
Yongqiang the position of deputy general manager.
Appointed as the Deputy General
Zhou
Deputy GM Appointed June 26,2022 Manager at the sixteenth meeting of the
Yongqiang
Ninth Board of Directors.
II. Status of service
Working experiences of current directors, supervisors, and executives
Situation by the end of 2022:
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
Secretary of party committee 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, director and CFO of the company. Currently, he serves as Vice Secretary of party
committee ,Director and General Manger 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
38
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
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 Dajing Industrial and director of the Company.
Shi Gonggong, male, born in July 1972, master's degree in software engineering, Senior Accountant. He used
to be the Leading Accountant of Accounting Section, Director of Enterprise Management Section, Director of
Asset Management Department, Director of Investment and Financing Management Department and Deputy
Director of Financial Settlement Center, Director of Financial Audit Department, Assistant to General Manager,
Financial Director of Lida Optoelectronics Dongguan Xujin Optoelectronics Co., Ltd., Director, Chief Accountant,
General Manager, Member and Deputy Secretary of the Party Committee of Hunan South China Optoelectronics
Co., Ltd. He is currently the Director of Luoyang North, Jinan Qingqi and 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, post-doctorate and professor of new prodect development at Manchester
Universityof Technology, UK. Served as a lecturer, associate professor, assistant to the department head of the
39
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
First Department of Mechanical Engineering of Chongqing University, professor of the School of Mechanical
Engineering of Chongqing University, deputy director of the research institute, and concurrently served as
Chongqing Changan Automobile Co., Ltd., Chongqing Science and Technology Venture Capital Co., Ltd. Co.
, Ltd., Chongqing Angel Investment Guidance Fund Co., Ltd., Chongqing Zaisheng Technology Co., Ltd.,
Chongqing Electromechanical Co., Ltd., Chongqing Fuling Electric Power Industry Co., Ltd., Chongqing
Three Gorges Paint Co., Ltd., and Chongqing Zhengchuan Pharmaceutical Packaging Materials Co., Ltd. are
independent Director, outside director of Chongqing Iron and Steel (Group) Co., Ltd. He is currently a
professor, doctoral supervisor, deputy director of the research center, and department head of the School of
Economics and Business Administration of Chongqing University, and concurrently serves as an independent
director of Kunming Yunnei Power Co., Ltd. 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. and the Supervisor of the Company'.
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.
40
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Liao Jian, male, born in April 1971, college degree in accounting, Assistant Accountant. He used to be the
Director of Accounting Office of Finance Department of Jianshe Group, Director of Securities Office of Asset
Operation Department, Deputy Director, Deputy Director and Director of Finance Department of Jianmo B,
Deputy General Manager (concurrently) of Vehicle Air Conditioning, Director of Jianshe Electromechanical
Finance Department, Executive and Deputy General Manager of Pingshan Taikai, and Deputy Director (presiding)
of Audit Risk Department of Jianche B. He is currently the Director of Audit Risk Department and Employee
Supervisor of the Company.
Su Qiang, male, born in November 1986, graduated from North University of China, majoring in Mechanical
and Electronic Engineering, Political Engineer. He used to be the Technician in the Casting Room of the
Company's Equipment Preservation Section, participating in post-job training in Chongqing Municipal Committee
of the Communist Youth League, Communist Youth League officer and organization officer in the Party-mass
Work Department of the Company, Marketing Planner and Engine Salesman in the Joint Venture Business
Department of the Company, and Deputy Head of the Purchase Management Division in the Production
Management Department of Zhuzhou Jianshe Yamaha Motorcycle Co., Ltd. He is currently the Deputy Secretary
of the Communist Youth League Committee, the Deputy Secretary of the Party Branch ,the Deputy Director of the
Party-mass Work Department and Employee Supervisor of the Company.
Xu Wanming, male, born in August 1971, bachelor's degree in economics from Chongqing Institute of
Technology, title of senior engineer. He used to be deputy director of the organization department of the Party
Committee and secretary of the party branch, deputy director of the supervision department of committee for
discipline inspection and secretary of the joint party branch of discipline inspection and audit, director of human
resources department and secretary of the party branch (during which he served as deputy director of the human
resources section of the human resources department of CSGC) in Chang'an Industry and secretary of
committee for discipline inspection of Sichuan Jian'an Industry Co., Ltd. He is currently the secretary of
committee for discipline inspection 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.
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
41
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
department; Deputy Division Chief of the manufacturing department of Chang’an Automobile Yubei Factory
(Concurrent Post). He is currently the Vice Chairman of the Company's worker union, Minister of the party and
mass work department, and Employee Supervisor. he served as Deputy General Manager of the Company.
Zhou Yongqiang, male, born in December 1972, bachelor's degree in management engineering from
Chongqing Institute of Industrial Management, title of senior economist. He used to be the director of
investment management section and the deputy director of investment management section in China Jialing
Group, the assistant director of planning department, the deputy director and director of enterprise development
department in China Jialing; General manager of Chongqing Jiufang Foundry Co., Ltd.; Assistant to general
manager and director of development planning department, secretary of board of directors and deputy general
manager of China Jialing; Director of Jianshe Mechanical & Electrical Equipment, Chongqing Jialing Industrial
Co., Ltd. and Jinan Qingqi; Director of motorcycle reform and development section, southwest region
department of Southern Group; Director of Luoyang North and the Company. He is currently the deputy general
manager 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 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
Names of the Titles engaged in Sharing date of office Expiry date of remuneration
persons in
shareholders the shareholders term office term or allowance
office
from the
shareholder
Dong Qihong Luoyang North Director October 10,2018 Yes
Dong Qihong Jinan Qingqi Director December 3,2018 Yes
Dong Qihong Dajiang Industrial Director November 29,2021 Yes
Shi Qingong Luoyang North Director April 16,2021 Yes
Shi Qingong Jinan Qingqi Director April 6,2021 Yes
Southern Group
Director of the
Southwest Region
Zhou Enterprise
Motorcycle Feform July 1,2013 June 30,2022 Yes
Yongqiang Development
and Development
Department
Dept
Zhou
Luoyang North Director April 7,2016 May 30,2022 Yes
Yongqiang
Chairman of the
Zhang Lungang Jianshe Industry November 6,2017 January 11,2023 Yes
board of supervisors
Yunnan Xiyi
Zhang Lungang Supervisor November 6,2017 April 6,2023 Yes
Industry Co., Ltd.
Qiao Guoan Jianshe Industry Supervisor January 3,2018 January 11,2023 Yes
Lu Xianyun Yunnan Xiyi Supervisor November 10,2020 Yes
Offices taken in other organizations
42
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
√Applicable □Not applicable
Take
Name of the
Names Positions Job started Job ended remunerations
parties
from the party
Chongqing
Tongkang
Hao Lin Chairman July 1,1999 Yes
Technology Co.,
Ltd.
Chongqing
University Assets
Li Jiaming GM November 21,2021 Yes
Management Co.,
Ltd.
Chongqing
University of
Technology
Xie Fei Professor January 4,2016 Yes
School of
Economics and
Finance
Professor,Ph.D,
Chongqing Associate Director
University of of the research
School of center, Head of the
Liu Wei April 2,2001 Yes
Economics and Department of
Business Business
Administration
Management,
Ph.D
Accounting School
Song Weiwei Professor July 3,2000 Yes
of CQUT
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
III. 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 Board of Directors follows the market rules and reflects the characteristics of enterprise, and
implements an annual salary system for the members of the managers, which consists of basic annual salary and
performance annual salary. By signing employment contracts and performance contracts, stipulating
responsibilities, rights and obligations, conducting strict employment management and objective assessment, and
smoothing the exit mechanism, it will build a professional and specialized management team.
During the implementation, the Board of Directors decides the salary structure and level of managers in
accordance with the Salary Management Measures and the Performance Management Measures. The basic annual
salary is the annual basic income, which is mainly determined according to the relative value of the positions of
managers, the responsibilities and risks they undertake, work experience, ability to hold positions and other
factors. The annual salary of performance is the annual floating income, which is linked to the annual performance
assessment results, reflects the situation of managers' completion of the annual business plan and objectives, and
is determined according to the completion of the Company's main financial indexes and individual performance
assessment results.
Remuneration of directors, supervisors, and executives in the report period
In RMB 10,000
Total Remuneration
Name Positions Sex Age Office status remuneration actually
received from receives at the
43
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
the shareholder end of the
reporting
period
Yan Xuechuan Chairman Male 59 In office 36.46 No
Fan Aijun Director, GM Male 51 In office 36.46 No
Dong Qihong Director Male 58 In office 14.91 Yes
Shi Qingong Director Male 50 In office 12.67 Yes
Zhou
Director Male 50 In office 0 Yes
Yongqiang
Hao Lin Director Male 59 In office 0 Yes
Independent
Li Jiaming Male 57 In office 3.57 No
Director
Independent
Xie Fei Male 58 In office 3.57 No
Director
Independent
Song Weiwei Female 47 In office 3.57 No
Director
Independent
Liu Wei Male 58 In office 3.57 No
Director
Chairman of
Lu Xianyun the supervisory Male 58 In office 28.91 Yes
committee
Zhang Lungang Supervisor Male 55 In office 23.42 Yes
Qiao Guoan Supervisor Male 58 In office 23.51 Yes
Employee
Liao Jian Male 51 In office 17.34 No
Supervisor
Employee
Su Qiang Male 36 In office 15.76 No
Supervisor
Secretary of the
Commission
Xu Wanming Male 51 In office 15.67 No
for Discipline
Inspection
Chief
Tan Mingxian Male 49 In office 33.21 No
accountant
Li Yongjiang Deputy GM Male 41 In office 26.69 No
Zhou
Deputy GM Male 50 In office 23.69 No
Yongqiang
Secretary of the
Zhang Hushan Male 35 In office 21.68 No
Board
Yu Wenbiao Deputy GM Male 56 Dimission 33.38 No
Total -- -- -- -- 378.04 --
44
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
VI. Performance of directors' duties during the reporting period
1. Information of the board meetings during the reporting period
Session Convening date Disclosure date Meeting resolution
The 12th meeting of the Ninth It was reviewed and approved: Proposal on re-adjusting the transfer price of assets such as factory
January 9,2022 January 10,2022
Board of Directors buildings and land.
It was reviewed and approved:1. Proposal on 2021 Annual Investment Plan.2. Proposal on the 2021
Annual Financing Plan of Chongqing Jianshe Vehicle Air Conditioning Co., Ltd., a wholly-owned
subsidiary.3. Proposal on Estimated Daily Related Party Transactions in 2022.4. Proposal on Estimated
External Guarantee in 2022.5. Proposal on the 2022 annual training plan.6. Proposal on adjusting the
The 13th meeting of the Ninth
January 21,2022 January 22,2022 organizational structure.7. Proposal on amending the Articles of Association. 8. Proposal on amending the
Board of Directors Rules of Procedure of the Board of Directors. 9. Proposal on adjusting the members of the Remuneration
and Appraisal Committee of the Ninth Board of Directors. 10. Proposal on adding members of the
Nomination Committee of the Ninth Board of Directors.11. Proposal on Convening the First Extraordinary
General Meeting of Shareholders in 2022.
It was reviewed and approved:1.The Work Report of the Board of Directors for 2021.2. The Work Report
of the General Manager for 2021.3. Annual Report 2021 and Summary,4.. The dividend plan 2021.5.
Evaluation Report on Internal Control in 2021.6. Summary Report on Corporate Audit of Accounting
Firms in 2021 and Proposal on Renewing Financial Audit Institutions and Internal Control Audit
Institutions in 2022. 7. Proposal on accepting financial services and related transactions. 8. Report on the
The 14th meeting of the Ninth risk assessment to the China South Industries Group Finance Co., Ltd. 9. Proposal on the 2022 annual
April 28,2022 April 30,2022
Board of Directors audit plan. 10. .The First quarter Report of 2022.11. 11. Proposal on amending the Working Rules of the
Strategy Committee. 12. Proposal on amending the Working Rules of the Audit Committee. 13. Proposal
on amending the Working Rules of the Remuneration and Appraisal Committee. 14. Proposal on amending
the Working Rules of the General Manager. 15. Proposal on amending the Administrative Measures for
Authorization by the Board of Directors. 16. Proposal on formulating the Administrative Measures for
Foreign Donations. 17.Proposal on Convening the General Meeting of Shareholders in 2021.
The 15th meeting of the Ninth
May 23,2022 May 24,2022 It was reviewed and approved: Proposal on dismissing Mr. Yu Wenbiao as Deputy General Manager.
Board of Directors
The 16th meeting of the Ninth Listened to the report: A report on Mr. Zhou Yongqiang's resignation as a director. Deliberated and passed:
June 26,2022 June 27,2022
Board of Directors the proposal on appointing Mr. Zhou Yongqiang as the deputy general manager of the company.
It was reviewed and approved: Proposal for semi-annual report 2022 and its summary.2. Report on the risk
The 17th meeting of the Ninth
August 29,2022 August 31,2022 assessment of the China South Industries Group Finance Co., Ltd. 3. Proposal on adjusting organizational
Board of Directors
structure.
45
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
It was reviewed and approved:：1.The Third quarter Report of 2022. 2. Proposal on changing accounting
firms. 3. Proposal on amending the Administrative Measures for Remuneration of Managers. 4. Proposal
on amending the Administrative Measures for Performance of Managers. 5. Proposal on amending the
The 18th meeting of the Ninth
October 27,2022 October 29,2022 Administrative Measures for Investment in Fixed Assets. 6. Proposal on formulating the Negative List of
Board of Directors
Investment Projects. 7. Proposal on amending the Administrative Measures for Funds. 8. Proposal on
amending the Salary Management System. 9. Proposal on formulating the Investor Relations Management
System. 10. Proposal on Convening the Second Provisional General Meeting of Shareholders in 2022.
46
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
2. Attendance of directors at the board meetings and the general meeting of shareholders
Attendance of directors at the board meetings and the general meeting of shareholders
Number of Number of
Whether to
board Number of board Number of
Number of attend the General
meetings board meetings board
Name of board board meetings of
attended meetings attended by meetings
director meetings meeting in shareholders
during the attended in means of attended by
absent from person twice attended
reporting person communicati proxy
in a row
period on
Yan
7 3 4 0 0 No 3
Xuechuan
Fan Aijun 7 3 4 0 0 No 3
Dong Qihong 7 3 4 0 0 No 3
Shi Qingong 7 2 4 1 0 No 2
Hao Lin 7 3 4 0 0 No 3
Li Jiaming 7 3 4 0 0 No 3
Xie Fei 7 3 4 0 0 No 3
Song Weiwei 7 3 4 0 0 No 3
Liu Wei 7 3 4 0 0 No 3
Zhou
4 2 2 0 0 No 1
Yongqiang
3. Directors' objections to related matters of the Company
Whether the director raises any objection to the relevant matters of the Company
□ Yes √ No
During the reporting period, the directors did not raise any objection to the relevant matters of the Company.
4. Other descriptions of directors' performance of duties
Whether the directors' suggestions on the Company have been adopted
√ Yes □No
The director's statement on whether the relevant suggestions of the Company have been adopted or not
In 2022, the Company's directors learned about the its production and operation through field visits, consulting
the Company's information and listening to reporting, and paid attention to the development of the automobile
industry, important customers, key suppliers, major competitors and other related situations. In their respective
professional fields, they put forward professional opinions and management suggestions on its product structure
adjustment and new product R&D direction. The management of the Company listened to and adopted the
suggestions of the directors, and implemented them in specific work.
47
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
VII. Situation of special committees under the Board of Directors during the reporting period
Number
of
Other information Details of
Committee meeting Convening
Member information Meeting content Put forward important opinions and suggestions of duty objections
name s date
performance (if any)
convene
d
Negotiate with the
accounting firm to
determine the
Audit of and Opinions on the 2021 time schedule of
1. It is agreed to submit the 2020 annual accounting
Annual Financial Statements the annual
statement prepared by the Company's Finance
Prepared by the Company's financial report
Department to the accounting firm for preliminary
Finance Department; Audit of and audit, pay
review. 2. It is agree that the accounting firm should
January Opinions on the Overall Audit attention to the
implement the audit procedures according to the above
7,2022 Strategy of the 2020 Annual progress of the
audit strategy and specific plan.
Financial Statements Submitted; audit many times
3. It is agreed to submit the Proposal on Estimated
Audit of and Opinions on the during the audit,
Daily Related Party Transactions of the Company in
Company's Estimated Daily and urge the
2022 to the Board of Directors for consideration.
Related Party Transactions in 2022. accounting firm to
4：Chairman of the submit the audit
Committee: Song report within the
Audit
Weiwei, Member: Li 5 agreed time limit.
Committee
Jiaming, Xie Review the 2022 Audit Plan of the
March It is agreed to submit the Company's 2022 audit plan to
Fei ,Dong Qihong Company and put forward
10,2022 the Board of Directors for deliberation.
opinions.
"Review and opinions on the first 1. It is agreed to submit the 2021 annual audit report
draft of the Company's accounting issued by Zhongxingcai Certified Public Accountants to
statement and audit report in the Board of Directors for deliberation. 2. It is agreed to
2021"; "Review and opinions on submit the 2021 internal control evaluation report to the
the internal control evaluation Board of Directors for deliberation. 3. It is suggested
April report in 2021"; "Summary of the that Zhongxingcai Guanghua Certified Public
8,2022 audit work of the accounting firm Accountants LLP shall continue to be employed to
in 2021"; "Suggestions on whether audit the financial statements and internal control of the
to renew the employment of Company in 2022. It is suggested that the audit fee for
Zhongxingcai Guanghua Certified financial statements should be RMB 450,000 and the
Public Accountants LLP and pay audit fee for internal control should be RMB 150,000.
the audit fees in 2022"; "Review 4. It is agreed to accept the financial service agreement
48
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
and opinions on the financial provided by CSGC Finance, and it is suggested that the
service agreement provided by maximum daily deposit balance of the Company and its
China South Industries Group subsidiaries in CSGC Finance should not be higher
Finance Co., Ltd."l than RMB 300 million within the validity period of the
agreement; The annual comprehensive credit line of
CSGC Finance should not exceed RMB 560 million,
and the bill discount should not exceed RMB 560
million; The accumulated interest incurred by the
CSGC Finance for comprehensive credit granting, bill
discounting and other credit businesses every year
should not exceed RMB 30 million.
"Review and opinions on the 1. It is agreed to submit the Company's 2022 semi-
Company's semi-annual accounting annual accounting statements to the Board of Directors
August
statements in 2022", "Evaluation for deliberation. 2. It is considered that the risk of
19,2022
and opinions on semi-annual risk of deposit and loan finance business between the
CSGC Finance" Company and CSGC Finance is controllable.
1. It is agreed to submit the Company's accounting
statement for the third quarter of 2022 to the Board of
"Review the Company's accounting
Directors for deliberation. 2. It is agreed to re-employ
statements in the third quarter of
Da Hua Certified Public Accountants (special general
October 2022 and make comments",
partnership) as the institution for the Company's 2022
14,2022 "Review the Company's change of
annual financial report and internal control audit, with a
accounting firm and make
term of one year and a total audit fee of RMB 550,000,
comments"
and it is agreed to submit it to the Company's Board of
Directors for deliberation.
"Study and opinions on the
Company's 2022 investment plan",
"Study and opinions on the It is agreed to submit the 2022 investment plan, 2022
January
Company's 2022 financing plan", financing plan and 2022 estimated external guarantee
7,2022
"Study and Opinions on the items to the Board of Directors for deliberation.
3：Chairman of the
Company's 2022 expected external
Committee：Yan
Strategy guarantee items"
Xuechuan, Member: 3
Committee 1. It is suggested that the Company's sales target for
Shi Qingong, Zhou "Study and opinions on the overall
automotive air-conditioning compressors in 2022 is 2
Yongqiang, Liu Wei business objectives of the
April million units, with an operating income of RMB 682
Company in 2022" and "Study and
18,2022 million. 2. It is suggested that the reserve fund should
opinions on the profit distribution
not be allocated or converted into share capital this
plan in 2021"
year.
October "Deliberate the proposal on It is agreed to submit the revised draft of the
49
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
14,2022 amending the Administrative Administrative Measures for Investment in Fixed Assets
Measures for Investment in Fixed and the Negative List of Investment Projects to the
Assets" and "Deliberate the Board of Directors for deliberation.
proposal on formulating the
Negative List of Investment
Projects".
4：Chairman of the
Review the qualifications of Zhou
Committee：Li The candidate is qualified and capable of performing
Nomination June Yongqiang as a candidate for
Jiaming, Member: 1 his duties, and it is agreed to submit the application to
Committee 21,2022 Deputy General Manager of the
Liu Wei, Song the Board of Directors for deliberation.
Company.
Weiwei, Fan Aijun
In 2021, there were 19 directors (including independent
directors) and senior managers who were paid by the
Company (including those who resigned). According to
the achievement of the Company's main financial
indicators and business objectives in 2021, combined
Review the performance of duties
with the assessment of the above-mentioned personnel's
February of directors and senior management
in-charge work indicators and their business abilities, it
4：Chairman of the 18,2022 in 2021, and conduct annual
was considered that the salary level of the Company's
Remuneration Committee: Xie Fei, performance assessment
directors and senior managers in this year was in line
and Assessment Member: Liu Wei, 2
with the provisions of the Company's Evaluation and
Committee Li Jiaming, Dong
Incentive System for Senior Managers, and it was
Qihong
agreed that the Company would pay a total salary of
RMB 4,176,100.
Discuss the Administrative It is agreed to submit the revised draft of the
Measures for Remuneration of Administrative Measures for Remuneration of
October
Managers and the Administrative Managers and the Administrative Measures for
14,2022
Measures for Performance of Performance of Managers to the Board of Directors for
Managers. deliberation.
50
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
VIII.The working status of the board of supervisors
The board of supervisors finds out whether the company has risks during the monitoring activities during the re
porting period
□ Yes √ No
The Supervisory Committee has no objection to the supervision matters during the reporting period.
IX. 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） 183
Number of in-service staff of the main subsidiaries（person） 600
Total number of the in-service staff（person） 783
Total number of staff receiving remuneration in the current
period（person） 783
The number of the parent company and the main subsidiary’s
retired staffs who need to bear the cost（person） 162
Professional
Classified according by Professions Number of persons（person）
Production 434
Sales 31
Technical 193
Financial 25
Administrative 100
Total 783
Education
Classified according by Professions Number of persons（person）
Mid-school or below 300
Colleges or above 210
Universities or above 254
Postgraduate or above 19
Total 783
2. Remuneration policies
The mode of piecework wage for production personnel was carried out. Sales commissions are employed
to sales personnel. Some technicians implement the agreed salary model; The rest of the staff implement the
broadband salary model.
3.Training plan
In 2022, the Company organized 125 training sessions throughout the year, including 77 internal training
sessions and 48 external training sessions, with a total of 2,811 person-times, a total of 16,391 class hours, and
an average training session of the Company's employees of 21 class hours, thus fully completing the Company's
51
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
annual training plan. It organized the on-the-job (transfer) training for and appraisal of 148 production and
operation employees in this year, and issued the on-the-job operation certificate. It provided online learning
platform, and opened self-learning courses in various fields for employees of the Company. By the end of the
year, the average class hours per person reached 39 hours.
4. Outsourcing situation
□ Applicable √ Not applicable
X. Specification of profit distribution and capitalizing of common reserves
Formulation, implementation or adjustment of the profit distribution policy, especially the cash dividend policy
during the reporting period
√ Applicable □ Not applicable
According to the Notice on Further Implementing Cash Dividends of Listed Companies (JJF [2012] No.37)
issued by China Securities Regulatory Commission, on July 26, 2012, the Seventh Meeting of the Sixth Board of
Directors of the Company supplemented and revised the profit distribution policy in the Articles of Association, in
which specific policies such as the form of profit distribution, the specific conditions and proportion of dividend
distribution, and the principle of using undistributed profits were defined, and submitted it to the First Provisional
General Meeting of Shareholders in 2012 held on August 30, 2012 for review and approval. The Board of
Directors of the Company prepares a profit distribution plan every year, which conforms to the provisions of the
Articles of Association of the Company, and independent directors have expressed their consent. The profit
distribution plan reviewed and approved by the General Meeting of Shareholders of the Company has been
implemented by the Board of Directors.
Special description of cash dividend policy
Whether it meets the requirements of the Articles of Association or the resolution of the
Yes
general meeting of shareholders:
Whether the dividend standard and proportion are explicit and clear: Yes
Whether the relevant decision-making procedures and mechanisms are complete: Yes
Whether the independent directors have performed their duties and played their due role: Yes
Whether the minority shareholders have the opportunity to fully express their opinions and
Yes
demands, and whether their legitimate rights and interests have been fully protected:
Whether the cash dividend policy is adjusted or changed, and whether the conditions and
Yes
procedures are compliant and transparent:
During the reporting period, the Company made a profit and the profit available to shareholders of the parent
company was positive, but no cash dividend distribution plan was put forward.
□ Applicable √ Not applicable
Profit distribution and capitalization of capital reserve during the reporting period
□ Applicable √ Not applicable
The Company will not distribute cash dividend or bonus shares, neither capitalizing of common reserves for the
report period.
XI. Implementation Situation of Stock Incentive Plan of the Company, Employee Stock Ownership Plan
or Other Employee Incentive Measures
□Applicable √ Not applicable
None
52
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
In 2022, with the goal of "strengthening internal control, preventing risks and promoting compliance", the
Company organized the construction and supervision of internal control system, established and improved the
internal control system of the Company oriented to risk management, and laid a solid foundation for the
Company's transformation, upgrading and healthy development.
1. Construction of internal control system
(1) The Company has established a governance structure consisting of General Meeting of Shareholders,
Board of Directors, Board of Supervisors, managers and various business organizations, and defined the rights
and obligations of all levels. It has established the Company's articles of association, the rules of procedure of
each governance body, the authorization management measures, the reporting system of major events and the
management system of various businesses, etc., and strictly implemented them.
(2) The audit committee under the Board of Directors of the Company is responsible for supervising and
evaluating the Company's internal control and risk management. The Audit Risk Department inspects and
supervises the establishment and implementation of the Company's internal control system, the authenticity and
integrity of the Company's financial information, the Finance Department is responsible for the construction of
the internal control system, the Asset Management Department is responsible for compliance management, and
the Board of Directors is responsible for the Company's internal control system and effective implementation. In
2022, the Company did not have any major defects in internal control of financial reporting, nor did it find any
major defects in internal control of non-financial reporting.
The Company has 5 full-time internal control personnel, including 2 with intermediate titles and 3 with
junior titles. According to the Company's performance management methods and regulations, the Company
comprehensively evaluates the employee's performance at the end of the year, and the annual assessment of
internal control personnel is Excellent.
(3) Construction and implementation of internal control system.
In 2022, the Company issued the annual work plan of the Board of Directors, which further enhanced the
standardization and effectiveness of the work of the board of directors, ensured the smooth and efficient
operation of the board of directors; Revised and improved seven corporate governance documents, including the
Articles of Association and the Rules of Procedure of the Board of Directors, and compiled a list of rights and
responsibilities ("four forms and one table"), which met the new requirements of governance improvement.
The Company comprehensively combed all business activities and control points, revised and improved
relevant systems and processes to ensure the effectiveness of the Company's internal control system. In 2022, it
revised and improved 96 management systems, including internal control systems in key areas such as capital,
finance, bidding, procurement and sales, and effectively implemented the Company's current management
system.
53
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
(4) Major risk assessment and monitoring.
The Company has strengthened daily risk monitoring, conducts annual comprehensive risk management
assessment, implemented relevant responsible units, formulated major risk prevention and measures of the
Company, and formed the Company's Comprehensive Risk Management Report; Set the monitoring threshold
for major risks, and judged the quarterly adjustment regularly according to the actual situation.
(5) Information management and control.
The Company has set up a leading group for network security work, designated professional technicians
for information technology to be responsible for the Company's information construction and security operation
and maintenance, and established a relatively complete information management system. In terms of digital
transformation, under the overall framework of Overall Scheme of Digital Transformation Action Plan, the
Company's digital action plan is formulated in combination with the Company's information planning and
intelligent manufacturing planning. From 2023, the digital transformation will be gradually promoted. At
present, the Company has established information systems (CAD\CAE\CAM, PDM, ERP, TQM, MES, OA,
etc.) covering product design, production management and daily office. The Company's information system
covers wholly-owned subsidiaries and important fields and key links such as operation, finance, procurement,
sales, R&D.
The Company strengthens the daily network technology monitoring, well ensures the safety supervision
and inspection and safety protection of the Company's internal information system and the Company's extranet
website, and guarantees the safe and effective operation of Company's information system.
(6) Management and control of overseas enterprises.
The Company has no overseas enterprises.
2. Supervision and evaluation of internal control system
(1) Every year, the external audit institution audits the effectiveness of the Company's internal control, and
the Board of Directors issues a self-evaluation report on the Company's internal control.
(2) Supervision and evaluation of internal control system.
The Audit Risk Department of the Company worked out an evaluation plan, organized the key personnel
of the Business Planning Department, Finance Department, Asset Management Department, Purchasing
Department, Sales Department and other departments to divide their work according to business, carried out the
self-evaluation of internal control in 2022 from January 4, 2023 to February 15, 2023, and submitted the
Evaluation Report on Internal Control in 2022 to the Board of Directors (for details, please refer to CNINF on
April 29, 2023, Announcement No.: 2023-017).
2.Details of major internal control defects found during the reporting period
□ Yes √ No
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
XIII. Management and control of the Company's subsidiaries during the reporting period
Problems
Integration Measures taken Subsequent
Company name Integration plan encountered in Solution progress
progress for solution planned solution
integration
None None None None None None None
55
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
XIV.Internal control self-evaluation report or internal control audit report
1.Self-evaluation report on internal control
Disclosure date of appraisal report on
April 29,2023
internal control
Disclosure index of appraisal report on
Juchao Website:（http://www.cninfo.com.cn），Announcement No.:2023-017
internal control
Proportion of total unit assets covered by
appraisal in the total assets of the
100.00%
consolidated financial statements of the
company
Proportion of total unit incomes covered
by appraisal in the total business incomes
100.00%
of the consolidated financial statements
of the company
Standards of Defects Evaluation
Category Financial Report Non-financial Report
Indicator 1: General defects in company’s daily operation. It’s almost impossible
that some specific business fails to operate normally. Other business activities
and achievement of business goals will not be affected. Serious defects: It’s
General defects: ① Minor financial loss; ② Minor misstatement or reasonably possible that normal operations of some business may be influenced
omission of statement in terms of financial statement; ③ Minor but it will not affect the sustainable operation of our company. Significant
damage of reputation caused by its negative influence in some defects: it’s reasonably possible that operation capacity of some business may be
regions. Serious defects: ① Bring some financial loss to company; lost and it will endanger the company’s sustainable operation. Indicator 2:
② Cause moderate misstatement or omission of statement in terms Financial loss. General defects: It’s almost impossible that minor financial losses
of financial statement; ③ Serious damage of reputation caused by may be led to company. Serious defects: It’s reasonably possible that moderate
Qualitative standard its comparatively large-scale influence in some regions. Significant financial losses may be led to company. Significant defects: It’s possible that
defects: ① Bring significant financial loss to company; ② significant financial losses may be led to company. Indicator 3: Reputation of
Significant misstatement or omission of statement in terms of company. General defects: It’s almost impossible that the negative information
financial statement; ③ The significantly negative influence has popular in some regions will be caused, which may further affect company’s
attracted large-scale attention by the public and unrecoverable reputation. Serious defects: It’s reasonably possible that the negative information
losses have been brought to company. 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 the overall assets.
Indicator: The proportion of financial losses in the overall assets. General
General defects: It’s almost impossible that the amount of
defects: It’s almost impossible that the amount of financial losses accounting for
misstatement accounting for 0.05% of the overall assets or less will
0.05% of overall assets or less will occur. Serious defects: It’s reasonably
occur. Serious defects: It’s reasonably impossible that the amount
Quantitative criteria possible that the amount of financial losses accounting for 0.05% to 1% of the
of misstatement accounting 0.05% to 1% of the overall assets will
overall assets will occur. Significant defects: It’s reasonably possible that the
occur. Significant defects: It’s reasonably possible that the amount
amount of financial losses accounting for 1% of the overall assets or more will
of misstatement accounting for 1% of the overall assets or more
occur.
will occur.
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Number of major defects in financial
reporting（a） 0
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）
57
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
2. Internal Control audit report
√ Applicable □Not applicable
Review opinions in the internal control audit 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 31,2022.
Disclosure date of audit report
Disclosure
of internal control
Index of audit report of
April 29,2023
internal control (full-text)
Juchao Website: （http://www.cninfo.com.cn），
Internal audit report’s opinion
Announcement No.:2023-032
Type of audit report on internal control Unqualified auditor’s report
Whether there is significant defect in non-financial report No
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
XV. Rectification of self-examination problems in special governance actions of listed companies
According to the Notice on Well Ensuring the Special Self-examination of Listed Company Governance
(YZJF [2020] No.367) issued by Chongqing Supervision Bureau of China Securities Regulatory Commission,
the Company carried out self-examination according to the List of Special Self-examination of Listed Company
Governance issued by the government service platform of China Securities Regulatory Commission, and has
completed rectification for the existing problems. For details, please refer to the 2021 Annual Report.
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
V. Environmental & Social Responsibility
I. Significant environmental issues
Whether the Company or any of its subsidiaries is identified as a key polluter by the environment authorities
√ Yes □No
Policies and industry standards related to environmental protection
Environmental Protection Law of People's Republic of China, Water Pollution Prevention Law of People's
Republic of China, Air Pollution Prevention Law of People's Republic of China, Noise Pollution Prevention Law of
People's Republic of China, Solid Waste Pollution Prevention Law of People's Republic of China and Soil Pollution
Prevention Law of People's Republic of China.
Environmental protection administrative license
Three synchronizations for construction projects shall be conducted as required to obtain acceptance approval, and
pollution discharge permits shall be applied in accordance with regulations.
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Industrial emission standards and the specific situation of the pollutant emission involved in the production and business activities
Excessi
Company Emissi
Main pollutant Implemented ve
Main pollutant and on Emission port Emission Verified total
or and specific pollutant Total emission emissio
specific pollutant Emission way port distribution concentration emission(Tons
subsidiary pollutant emission n
name numbe condition (mg/Nm3) )
name Typeame standards conditio
r
n
Indirect discharge: Simplified Simplified No
it is discharged management management
COD：122mg/L； of pollutant of pollutant
into
petroleum： discharge discharge
Main pollutants of Zhongliangshan Grade III permits, no permits, no
Chongqing 0.14mg/L；
Main pollutants wastewater：COD, sewage treatment Standard of total amount total amount
Jianshe Total ammonia
of wastewater, ammonia nitrogen, plant after the Integrated required required
Vehicle 1 wastewater nitrogen：
Petroleum total phosphoru,PH； reaching the Wastewater
System Co., discharge outlet 10.1mg/L；total
category particular pollutants: Grade III standard Discharge
Ltd. phosphorus：
Petroleum category of the Integrated Standard
2.26mg/L；PH：
Wastewater
7.5-7.6
Discharge
Standard
Direct emission: Simplified Simplified No
Waste gas: Main Limit value of
Chongqing The treatment Nitrogen oxide： management management
pollutants: sO 2， main urban
of pollutant of pollutant
Jianshe meets the Exhaust gas 26mg/m3； area of the
Waste gas: Main nitrogen oxides, discharge discharge
Vehicle Integrated 1 outlet ofmelting particulate matter： Integrated
pollutants particulate matter; permits, no permits, no
System Co., Emission furnace 5.9mg/m3；sO 2： Emission
characteristic total amount total amount
Ltd Standard of Air 3mg/m3 Standard of required required
pollutants:None Air Pollutants
Pollutants
Indirect discharge: Simplified Simplified No
it is discharged management management
of pollutant of pollutant
into COD：128mg/L
discharge discharge
Main pollutants of Zhongliangshan petroleum： Grade III permits, no permits, no
wastewater: COD, sewage treatment 0.31mg/L ammonia Standard of total amount total amount
Main pollutants Total
Vehicle air ammonia nitrogen, plant after nitrogen：9.96mg/L the Integrated required required
of wastewater, 1 wastewater Wastewater
conditioner total phosphorus, PH reaching the total phosphorus：
total zinc discharge outlet Discharge
particular pollutants: Grade III standard 3.12mg/LPH：7.5-
Standard
total zinc of the Integrated 7.6 total zinc：
Wastewater 0.12mg/L
Discharge
Standard
Direct emission: Outlet of Limit value of Simplified Simplified No
Vehicle air Waste gas: Main Waste gas: Main The treatment 6 phosphating Nitrogen oxide： main urban management management
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
conditioner pollutants: pollutants: nitrogen meets the production line 3mg/m3， area of the of pollutant of pollutant
hydrogen oxides, particulate Integrated 1, outlet of particulate matter： Integrated discharge discharge
Emission phosphating Emission permits, no permits, no
chloride, xylene matter; characteristic 6.7mg/m3
Standard of Air production line Standard of total amount total amount
pollutants: hydrogen Pollutants 2, outlet of tin Air Pollutants required required
chloride, xylene plating
production line,
surface
treatment line,
outlet of shot
peening
workshop and
outlet of PTFE
production line
Implement Implement
PH：8.16-8.21； registration registration
Direct discharge:
for filing, fill for filing, fill
it reaches the COD：79；
in the in the
Main pollutants of first-class BOD5：16.4；
Chongqing Grade I pollutant pollutant
wastewater: PH, standard of Suspended
Pingshan standard of discharge discharge
COD, BOD5, Integrated
Main pollutants Total waste matter:14； Integrated registration registration
Taikai suspended solids, Wastewater 1 No
of wastewater water outlet Petroleum:0.31mg/ Wastewater form, do not form, do not
Carburetor petroleum, animal and Discharge
L；Animal and Discharge need to apply need to apply
Co., Ltd vegetable oils, Standard after
Standard for a pollutant for a pollutant
ammonia nitrogen. treatment and is vegetable oil：0.54
discharge discharge
discharged into mg/L；Ammonia permit, with permit, with
Huangxi River. nitrogen:7.64mg/L total amount total amount
not required not required
Nitrogen Implement Implement
oxide:3L， registration registration
particulate for filing, fill for filing, fill
Direct discharge: matter:9.6mg/m3， in the in the
Limits on
Chongqing it meets the sulfur dioxide:3L； pollutant pollutant
Main pollutants: Main Urban
Pingshan Integrated Exhaust port of The data with "L" discharge discharge
Area in
Waste gas: Main nitrogen oxides, sulfur registration registration
Taikai Atmospheric 1 die casting indicates that the Comprehensiv No
pollutants: dioxide and form, do not form, do not
Carburetor Discharge machine concentration of the e Atmospheric
particulate matter. need to apply need to apply
Co., Ltd Standard after pollutant is lower Emission
for a pollutant for a pollutant
Standard
treatment than the method discharge discharge
detection limit, and permit, with permit, with
the detection limit is total amount total amount
not required not required
3 mg/m3.
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Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
The treatment of the pollutants
Wastewater: The Company and its subsidiary vehicle air-conditioning company have respectively built a
wastewater treatment station. The wastewater station is operating steadily, equipment maintenance is carried out
regularly, and the treatment effect is good, and the discharge of pollutants from the total discharge outlet of the
wastewater has continued and steadily reached the standard.
Exhaust gas: the acid mist produced by phosphating, tinning and surface treatment is absorbed by the spray tower
to reach the standard. The exhaust gas at the outlet of the shot blasting workshop is washed and filtered with the
particle absorption device to reach the standard. The exhaust gas of the PTFE production line is equipped with
activated carbon adsorption + light Catalytic oxidation treatment to reach the standard. The melting furnace uses
the clean energy-natural gas, which reaches the standard at directly discharge. The pollution control facilities are
operating well and the operation records are complete.
Emergency plan for emergency environmental incidents
In order to establish a sound emergency response mechanism for environmental pollution incidents, improve
the Company’s ability to respond to sudden environmental pollution incidents involving public crises, prevent
environmental emergencies from polluting the public environment (atmosphere and water), maintain social
stability, protect the life, health and property safety of enterprises and the surrounding public, protect the
environment, and to promote the comprehensive, coordinated and sustainable development of society, the
Company and its wholly-owned subsidiary vehicle air-conditioning company have prepared the "Emergency Plan
for Emergent Environmental Incidents", which has been reviewed and approved by experts and thus it’s been
implemented.
Environmental self-monitoring program
The Environmental Protection Administration Department does not require the Company to carry out self-
monitoring, and entrusts the qualified Chongqing Yujiu Environmental Protection Industry Co., Ltd. to monitor
the wastewater, organized waste gas, unorganized waste gas and noise discharged by the Company and its wholly-
owned subsidiary Vehicle Air Conditioning Company and Pingshan Taikai Company on a yearly basis.
According to the monitoring results shown in the Monitoring Report (YJ (J) Zi [2022] No. WT572) and (YJ (J)
Zi [2022] No. WT571) issued on March 31, 2022, and the Monitoring Report (FL (J) Zi [2022] No. WT3025)
issued on October 27, 2022, the emissions of wastewater, organized waste gas, unorganized waste gas and noise
produced by the Company and its wholly-owned subsidiaries, namely Vehicle Air Conditioning Company and
Pingshan Taikai Company, all meet the relevant emission standards.
Investment in environmental governance and protection and the relevant payment of environmental protection tax
In 2022, the Company's taxable pollutants are air pollutants, and the actual total amount of environmental
protection tax paid is RMB 11,607.
Measures taken to reduce its carbon emissions during the reporting period and their effects
Applicable □Not applicable
First, vigorously develop the thermal management industry of new energy vehicles, and realize large-scale market
sales of new energy electric compressor products. Second, vigorously develop the green low-carbon parts industry,
adapt to the requirements of emission upgrading, and actively develop and cultivate the low-carbon
competitiveness of new products. Third, strengthen the green design of products, implement the green design
through the whole life cycle of products, strengthen the tracking of carbon footprint of products, select green low-
62
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
carbon materials and green low-carbon suppliers, and adopt modular and detachable design, and green recycling
packaging. Fourth, strengthen the low-carbon manufacturing of products, carry out low-carbon technological
reform, integrate or simplify processes, tap potential opportunities for carbon reduction, and carry out upgrading
of equipment in terms of information, automation, digitalization and intelligence. Fifth, adjust the energy
consumption structure, continuously increase the proportion of electric energy use through the electrification
transformation of equipment, promote the transformation of equipment and facilities and process optimization,
and reduce carbon dioxide emissions per unit output. Sixth, scientifically arrange production plans, carry out
energy conservation monitoring and energy design, and take energy evaluation as one of KPI indicators for
control.
Administrative penalties for environmental problems during the reporting period
Impact on the
Company's
Company or subsidiary Reason of Violation of production and
Punishment result rectification
name punishment regulations operation of listed
measures
companies
Chongqing Jianshe
Not No violation and
Vehicle System Co., Not applicable Not applicable Not applicable
applicable punishment
Ltd.
Not No violation and
Vehicle air conditioner Not applicable Not applicable Not applicable
applicable punishment
Chongqing Pingshan
Not No violation and
Taikai Carburetor Co., Not applicable Not applicable Not applicable
applicable punishment
Ltd
Other environmental information that should be disclosed
For environmental disclosure information, please refer to the Company's extranet http://www.jianshe.com.cn.
Other Environmental Related Information
See the foregoing for details.
II. Social responsibilities
(1) 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
The Company respects and safeguards employees' rights and interests, and is committed to promoting
employees' all-round development, realizing the common promotion of employees' personal value and
enterprise value, and striving to benefit the majority of employees from the achievements of enterprise reform
and development. First, adhere to the democratic management system. Set up employee directors and employee
supervisors to participate in the Company's decision-making and supervision, establish a democratic
63
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
management system with employee congresses as the basic form, and support employees to participate in
enterprise management. In 2022, the Company held one employee representative meeting, one model worker
symposium and four employee representative symposiums, and widely listened to employees' opinions and
suggestions on the Company's development, and implemented or replied to 73 items one by one. Second,
continue to make factory affairs public. The Company made use of the newspaper of Jianshe Shares and OA
collaborative office platform to disclose the matters that employees should know in a timely manner, and
disclosed 170 major matters involving the vital interests of employees throughout the year.
Thrid, pay attention to the basic guarantee for employees. The Company paid "five insurances and one
fund" for employees on time, with an accumulated annual total of RMB 25.68 million, and bought 704 critical
illness insurance for employees, with a premium of RMB 21,100. It improved the company's system of helping
and consoling, and consoled 92 employees with difficulties, sick and hospitalized employees and their relatives
throughout the year; cared for female workers and children, and helped 536 people by carrying out activities
such as condolence, assisting students in the golden autumn and reading companionship; and carried out cool-
off activities in summer and offered holiday condolences to 2,502 people, with a total condolence amount of
RMB 640,200. Fourth, care for employees' health. The Company strengthened occupational health management,
carried out emergency rescue knowledge training and occupational health publicity, and regularly carried out
occupational hazard factors detection in workplaces. It organized 346 workers exposed to harm to take pre-job,
on-the-job and off-the-job occupational health examination, distribute cool drinks and heatstroke prevention
drugs, and paid a total of RMB 82,000. Fifth, pay attention to employee growth and talent cultivation. The
Company organized 125 training sessions throughout the year, with a total of 2,811 person-times, and a total
class hour of 16,391. It strengthened the training and use of young cadres, and the proportion of cadres in the
"post-80s" has increased to 45.8%.
(III) Protection of rights and interests of suppliers, customers and consumers
First, adhere to fairness, justice and good faith in market transactions, strictly abide by all laws, regulations,
regulatory provisions and international rules, adhere to equal consultation, achieve mutual benefit and win-win,
strictly abide by contract terms, fulfill transaction promises and fulfill contractual obligations. Promote the
informatization of procurement management, deepen the use of the electronic procurement platform of
Norincogroup-eBuy, and fully realize the openness, centralization and electronization of tendering procurement.
Second, improve and upgrade the product quality, adhere to the value orientation of "Quality First",
vigorously carry forward the "Artisan Spirit" and continue to pursue quality excellence. In 2022, the Company
continued to promote the construction of "1+N" quality system and successfully passed the IATF16949 system
renewal audit. It has initially set up and gradually popularized the supplier quality competency certification
(QJS) system. The "quality improvement activity" has achieved practical results, in which the first pass rate of
helium inspection of electric compressors and the success rate of dynamic and static disk matching have been
significantly improved.
(IV) Environmental protection and sustainable development
The Company aims at green development, establishes employees' awareness of environmental protection,
actively fulfills environmental responsibility and practices the concept of low-carbon life. First, vigorously
develop the thermal management industry of new energy vehicles, and realize large-scale market sales of new
64
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
energy electric compressor products. Second, vigorously develop the green low-carbon parts industry, adapt to
the requirements of emission upgrading, and actively develop and cultivate the low-carbon competitiveness of
new products. Third, strengthen the green design of products, implement the green design through the whole
life cycle of products, strengthen the tracking of carbon footprint of products, select green low-carbon materials
and green low-carbon suppliers, and adopt modular and detachable design, and green recycling packaging.
Fourth, strengthen the low-carbon manufacturing of products, carry out low-carbon technological reform,
integrate or simplify processes, tap potential opportunities for carbon reduction, and carry out upgrading of
equipment in terms of information, automation, digitalization and intelligence. Fifth, adjust the energy
consumption structure, continuously increase the proportion of electric energy use through the electrification
transformation of equipment, promote the transformation of equipment and facilities and process optimization,
and reduce carbon dioxide emissions per unit output. Sixth, scientifically arrange production plans, carry out
energy conservation monitoring and energy design, and take energy evaluation as one of KPI indicators for
control.
(V) Public relations and social welfare undertakings
In 2022, the Company actively participated in activities such as consumption poverty alleviation of
unsalable agricultural and sideline products, consumption assistance of central enterprises, and special
consumption assistance in Yanshan County, Yunnan Province, and realized an assistance total of RMB 67,700.
It actively promoted employment and poverty alleviation. In combination with the annual recruitment plan, the
Company actively participated in activities such as school recruitment by the state, participated in 7 double-
election meetings, received more than 250 resumes, interviewed more than 45 people and admitted 15. It
actively responded to the call of young cadres between CSIC Group and Honghe Prefecture, Yunnan Province,
and received one cadre from Maitreya City, Honghe Prefecture, for temporary exchange for a period of six
months.
III. Consolidate and expand the achievements of poverty alleviation and rural revitalization
For details, please refer to "Public Relations and Social Welfare" in "II(5). Social Responsibility" in this section.
65
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
VI. Important Events
I. 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
There is no commitment that has not been fulfilled by actual controller, shareholders, related parties, acquirers
of the Company
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
II. Particulars about the non-operating occupation of funds by the controlling shareholder
□ Applicable √ Not applicable
No such cases in the reporting period.
III. Illegal provision of guarantees for external parties
□ Applicable √ Not applicable
No such cases in the reporting period.
IV. Explanation of the Board of Directors on the latest "Non-standard Audit Report"
□ Applicable √ Not applicable
V. Notes for “non-standard audit report” of CPAs firm during the Reporting Period by board of
directors and supervisory board
□ 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
1. Change of accounting policy
The impact for implementing Interpretation No.15 of Accounting Standards for Business Enterprises on
the Company
On December 31, 2021, the Ministry of Finance issued Interpretation No.15 of Accounting Standards for
Business Enterprises (CK [2021] No.35, hereinafter referred to as "Interpretation No.15"), which explained the
66
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
"accounting treatment for the external sales of products or by-products produced by enterprises before the fixed
assets reach the intended serviceable state or during the R&D process (hereinafter referred to as Trial Sales)"
and "Judgment on loss contract", which were implemented since January 1, 2022. The implementation of
Interpretation No.15 of Accounting Standards for Business Enterprises has no impact on the Company.
The impact for implementing Interpretation No.16 of Accounting Standards for Business Enterprises on
the Company
On December 13, 2022, the Ministry of Finance issued Interpretation No.16 of Accounting Standards for
Business Enterprises (CK [2022] No.31, hereinafter referred to as Interpretation No.16). Among the three
accounting treatments of Interpretation No.16, "The deferred income tax related to assets and liabilities arising
from a single transaction is not applicable to the accounting treatment of initial recognition exemption" will
come into effect on January 1, 2023, allowing enterprises to advance from the year of publication. The
Company did not implement the accounting treatment related to this matter in advance this year; The contents
of "accounting treatment of income tax impact on dividends related to financial instruments classified as equity
instruments by issuers" and "accounting treatment of enterprises changing cash-settled share-based payment
into equity-settled share-based payment" shall come into force as of the date of promulgation. The
implementation of Interpretation No.16 of Accounting Standards for Business Enterprises has no impact on the
Company.
2. Changes in accounting estimates
The main accounting estimates have not changed during the reporting period.
VII.Explain change of the consolidation scope as compared with the financial reporting of last year.
□ Applicable √ Not applicable
No such cases in the reporting period.
VIII. Engagement/Disengagement of CPAs
CPAs currently engaged
Domestic CPA Da Hua Certified Public Accountants (LLP)
Reward for domestic CPA (RMB '0,000) 40
Successive years the domestic CPA has been providing service
to the Company 1
Name of CPAs from the domestic CPA firm Xu Shibao, Xie Jun
Continuous life of auditing service for domestic accounting
firm 1 year, 1 year
Has the CPAs been changed in the current period
√Yes □ No
67
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Whether to hire an accounting firm during the audit
□ Yes √ No
Whether the change of accounting firm has fulfilled the examination and approval procedures
√Yes □ No
Detailed Explanation of the Change of Employment and Change of Accounting Firm
The Company held the eighteenth meeting of the Ninth Board of Directors on October 27, 2022, and
deliberated and passed the Proposal on Changing Accounting Firms. On November 25, 2022, with the approval
of the second extraordinary general meeting of shareholders in 2022, it was agreed to re-employ Dahua
Certified Public Accountants (special general partnership) as the Company's auditing agency for financial
accounting report and internal control in 2022, with a term of one year and an audit fee of RMB 550,000,
including the audit fee for financial accounting report of RMB 400,000/year, and the audit fee for internal
control of RMB 150,000/year. The explanation is as follows:
(I) The situation of the former accounting firm and the audit opinions of the previous year
The former accounting firm of the Company is Zhongxing Caiguanghua Certified Public Accountants
(special general partnership), which has provided audit services for the Company for five consecutive years. In
2021, Zhongxing Caiguanghua Certified Public Accountants issued a standard unqualified audit report for the
Company. The Company did not dismiss the former accounting firm after entrusting the former accounting firm
to carry out some audit work.
(II) Reasons for changing accounting firm
Zhongxing Caiguanghua Certified Public Accountants adheres to the principle of independent audit in the
course of practice, and earnestly performs the due duties of an auditor. In view of the fact that Zhongxing
Caiguanghua Certified Public Accountants has provided audit services for the Company for five consecutive
years, in order to ensure the independence and objectivity of the Company's audit work, the Company no longer
hired it as the auditor for 2022, and hired Da Hua Certified Public Accountants (LLP) as the auditor for the
Company's financial report and internal control for one year.
(III) Communication between the Company and the former accounting firm
The Company communicated with Zhongxing Caiguanghua Certified Public Accountants in advance on
this change of accounting firm. According to the relevant provisions of China Standard on Auditing No.1153-
Communication between Predecessor and Successor Auditors, the Company agreed that Da Hua Certified
Public Accountants and Zhongxing Caiguanghua Certified Public Accountants should fully communicate, and
68
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
both parties have actively well ensured communication and cooperation on the change of accounting firms, and
have not raised any objection to the change of accounting firms.
Description of the CPAs, financial adviser or sponsor engaged for internal control auditing
√ Applicable □ Not applicable
Da Hua Certified Public Accountants (LLP) is engaged the auditor of internal control system for the current
year. With payment of RMB 150,000 for its service.
IX. Situation of Facing Listing Suspension and Listing Termination after the Disclosure of the Yearly
Report
□Applicable √ Not applicable
X. Relevant Matters of Bankruptcy Reorganization
□Applicable √ Not applicable
No such cases in the reporting period.
69
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
XI. Matters of Important Lawsuit and Arbitration
√ Applicable □ Not applicable
Involved
amount Provisio Decisions and Execution of Disclosure Index to disclosed
General information Progress
(RMB n effects decisions date information
'0,000)
Chongqing HYOSOW have failed to pay Vehicle Air Conditioning See details in the
Company, a full-owned subsidiary of the Company for the air company’s
conditioner compressors. The Vehicle Air Conditioning Company announcement
The Company has
filed a lawsuit with Chongqing Yubei District People's Court in fully accrued bad published on
November 2018, who held a hearing on July 11, 2019. The Company debts in 2018. The securities times,
In 2020, 947
received the "Civil Judgment of Chongqing Yubei District People's company was August Hongkong
1,232.5 No The trial ends compressors have
Court" on August 6, 2019 ((2018) Y0112 MC, No. 24010), where the ruled in favor of 16,2019 Commercial daily
the case, and the been recovered
"General Rules for Purchase of Parts and Materials" signed by the and
case has been
Company and Chongqing HYOSOW was cancelled. Chongqing http//www.cninfo.
closed.
HYOSOW returned 4,017 sets of goods to the Vehicle Air com.cn
Conditioning Company, and paid 12,325,044.85 yuan and loss of (Announcement
capital occupation. No.:2019-070)
The Company has In March 2021, it
fully accrued bad applied for
The Company’s wholly-owned subsidiary- Automotive Air
debts of 1.4088 compulsory
Conditioning Company-sued in the People’s Court of Xiangyang execution,，260
million in
High-tech Zone for a dispute over the sale and purchase contract, compressors have
2020.Min Chu
demanding that Hubei Meiyang Automobile Industry Co., Ltd pay been recovered, As www.cninfo.com.
No. 3234-(2019) April
1,408,800 yuan in arrears and return 260 compressors. According to 154.32 No The trial ends there is no other cn.Announcement
E 0691 The 30,2021
the civil judgment of the Min Chu No. 3234-(2019) E 0691 on property to enforce, No.:2021-017
company was the final ruling of
November 19, 2020, the defendant shall pay the air-conditioning
ruled in favor of the court was
company 1,408,800 yuan for goods and interest losses, and return
the case, and the received in June
260 compressors. 2022, and the case
case has been
closed. has been closed.
Reached a
mediation
The Company filed a lawsuit to the court of Jiujiang Economic and
agreement
Technological Development Zone in Jiangxi Province due to the Min Chu No. All of the mediation www.cninfo.com.
April
dispute over the sales contract, demanding Jiangxi Zhicheng 138.06 No The trial ends 3234-(2019) E agreements have cn.Announcement
30,2022
Automobile Co., Ltd and its Jingdezhen branch to pay 1,380,600 0691 The been performed No.:2022-024
yuan for the goods. company was
ruled in favor of
the case. and the
70
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
case has been
closed.
Suzhou
Intermediate
People's Court
The Company's wholly-owned subsidiary, Vehicle Air Conditioning
due to
Company, filed a lawsuit inChongqing No. 5 Intermediate People's
jurisdictional
Court against Ran Ping, Luo Fangqing, Zhang Ye, Changzhou
issues. Suzhou The trial will be www.cninfo.com.
Kangpurui Automobile Air Conditioning Co., Ltd, Chongqing April
100 No Intermediate held on April 8, Not judged cn.Announcement
Yuxian Sanji Auto Parts Co., Ltd, and Chongqing Dongdian 28,2020
People's Court 2021. No.:2020-024
Refrigeration Equipment Co., Ltd for infringement of technical
Case No. (2021)
secrets. After the Chongqing court filed the case, it was transferred to
S 05 MC
the Suzhou Intermediate People's Court due to jurisdictional issue.
No.305；and
the case has
been closed.
A mediation
The Company filed a lawsuit in the People's Court of Shunqing agreement No.
it applied for www.cninfo.com.
District, Nanchong City due to the sales contract dispute, requesting 1111Minchu1302 April
5.11 No The trial ends compulsory cn.Announcement
Sichuan Tianxi Automotive Air Conditioning Co., Ltd to pay 51,100 Chuan(2022) has 30,2022
execution No.:2022-024
yuan for the goods. been reached, The
trial ends
After the first
and second
instance
judgments, the
ruling rejected
his claims (first
www.cninfo.com.
Liu Bi, a retiree of the Company, sued the Company for instance No. April
18.91 No The trial ends The trial ends cn.Announcement
compensation of 189,100 yuan due to a work-related injury dispute. 28344Min 30,2022
No.:2022-024
Chu0113Yu
(2021), second
instance No.
4081Min
Zhong05Yu
(2022) and the
71
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
case has been
closed. The
company was
ruled in favor of
the case.
XII. Situation of Punishment and Rectification
□Applicable √ Not applicable
No such cases in the reporting period.
XIII. Credit Condition of the Company and its Controlling Shareholders and Actual Controllers
□Applicable √ Not applicable
XIV. Material related transactions
1. Related transactions in connection with daily operation
√ Applicable □ Not applicable
Principl Trading Whether
Amou
Subjects e of
nt of limit over the Market
of the pricing Ratio in Index of
Type of Price of trade( Way of price of Date of
Related parties Relationship related the similar approve approved information
trade trade RMB payment similar trade disclosure
transactio related trades disclosure
'0,000 available
ns transacti d(RMB limited or
)
ons
'0,000) not (Y/N)
Purchase of www.cninfo
raw .com.cn.An
Fair
Jianshe Under same materials January
Energy Market 200 84 0.18% 200 No Cash 200 nouncement
Industrial control from the 22,2022
Price No.:2022-
Related
person 006
72
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
China Changan
Automobile Sale of
finished
Group Co., Ltd. Under same Sales of Market 6， January The same as
parts and 15000 13.06% 15,000 No Bill+Cash 15000
And its control goods Price 193 22,2022 above
componen
affiliated ts
Enterprises
Joint venture
Sales of Spare Market 1， January The same as
Zhuzhou Jianya of controlling 1200 2.73% 1,200 No Cash 1200
goods parts sales Price 297 22,2022 above
shareholder
Joint venture
Sales of Spare Market January The same as
Zhuzhou Jianya of controlling 40 0 0.00% 40 No Cash 40
goods parts sales Price 22,2022 above
shareholder
South Air Joint venture
Sales of Spare Market January The same as
International of controlling 50 0 0.00% 50 No Cash 50
goods parts sales Price 22,2022 above
shareholder
Jianshe Sales of Spare part Market January The same as
Joint venture 1000 178 0.37% 1,000 No Cash 1000
HANON goods sales Price 22,2022 above
Sell
Jianshe products
Under same and Market January The same as
Mechanical and Energy 50 9 0.89% 50 No Cash 50
control commoditie Price 22,2022 above
Electric s to related
persons
Jianshe Sales of Market January The same as
Joint venture Energy 1300 2 0.20% 1,300 No Cash 1300
HANON goods Price 22,2022 above
Jianshe Under same Sales of Market January The same as
Energy 50 2 0.20% 50 Yes Cash 50
Industry control goods Price 22,2022 above
Jianshe Under same Market January The same as
Services Test fee 100 44 0.09% 100 No Cash 100
Industry control Price 22,2022 above
Minsheng Acceptanc
Logistrics And Joint venture e of
Market January The same as
of controlling Services warehousi 400 45 2.95% 400 No Cash 400
its affiliated Price 22,2022 above
shareholder ng
Enterprise services
Southwest
Ordnance
Chongqing
Under same Market January The same as
Institute of Services Services 200 151 3.30% 200 No Cash 200
control Price 22,2022 above
Environmental
Protection Co.,
Ltd.
Changan Under same Services Accept Market 100 84 5.51% 100 No Bill+Cash 100 January The same as
73
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Automobile control maintenan Price 22,2022 above
Group Co., Ltd. ce
And its
affiliated
Enterprises
Total -- -- 8,089 -- 19,690 -- -- -- -- --
Details of any sales return of a large amount None
The estimated total amount of "purchasing raw materials from related parties" is RMB 2 million, and the actual amount incurred is
RMB 840,000. The difference between the actual amount and the estimated amount at the beginning of the year is -58%.
The estimated total amount of "selling products and commodities to related parties" is RMB 186.9 million, and the actual amount
Give the actual situation in the report period where a forecast incurred is RMB 76.81 million. The difference between the actual amount and the estimated amount at the beginning of the year is
had been made for the total amounts of routine related-party -58.90%.
transactions by type to occur in the current period(if any) The estimated total amount of "accepting labor services provided by related parties" is RMB 8million, and the actual amount
incurred is RMB 3.24 million. The difference between the actual amount and the estimated amount at the beginning of the year is -
59.50%.
Reason for any significant difference between the transaction
Not applicable
price and the market reference price (if applicable)
74
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
2. Related-party transactions arising from asset acquisition or sold
□Applicable √ Not applicable
No such cases in the reporting period.
3. Related-party transitions with joint investments
□Applicable √ Not applicable
No such cases in the 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. Transactions with related finance company, especially one that is controlled by the Company
√ Applicable □Not applicable
Deposit business
Related party Relationship Maximum Deposit Beginning The amount of this period
daily deposit interest rate balance(RM Total amount
Total deposit Ending
limit(RMB range B '0,000) is withdrawn
'0,000) amount balance(RM
for this
(RMB B '0,000)
period(RMB
'0,000)
'0,000)
Military
Equipment Be controlled
Group by the same 30,000 0.35% 6,730.37 189,639.82 179,680.48 16,689.71
Finance party
Company
Loan business
Related party Relationship Beginning The amount of this period
Loan Loant balance(RM Total loan Total Ending
limit(RMB interest rate B '0,000) amount of repayment balance(RM
'0,000) range the current amount of B '0,000)
period(RMB the current
75
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
'0,000) period(RMB
'0,000)
Military
Equipment Be controlled
Group by the same 45,000 3.915-4.35% 27,325 51,580 37,755 41,150
Finance party
Company
Credit extension or other financial services
Related party Relationship Business type Total amount(RMB Actual amount
'0,000) incurred(RMB '0,000)
Military Equipment
Be controlled by the
Group Finance Credit 56,000 45,000
same party
Company
Military Equipment
Be controlled by the
Group Finance Other 56,000 0
same party
Company
6. Transactions between the financial company controlled by the Company and related parties
□ Applicable √Not applicable
There is no deposit, loan, credit or other financial business between the financial company controlled by the Company and related parties.
7. Other significant related-party transactions
√ Applicable □ Not applicable
In order to revitalize idle assets and improve the efficiency of asset operation, the Company publicly listed to transfer the Company's 106 workshop, the
corresponding land use rights and the related ancillary machinery and equipment through the Chongqing United Assets and Equity Exchange. This asset transfer
project was listed on the Chongqing United Assets and Equity Exchange for three rounds from November 2, 2021 to February 9, 2022, and was finally transferred to
the Company's related party-Construction Industry. On February 15, 2022, the two parties signed the "Asset transaction contract for Chongqing Construction
Automobile System Co., Ltd.'s overall transfer project of housing, land use rights, above-ground structures, and waste equipment", confirmed that the transfer price
was the public listing price of 152.88 million yuan. On April 25, 2022, the two parties completed the delivery of all transfer assets. After the completion of this
transaction, the income from asset disposal increased by RMB 39.02 million (it’s a non-recurring profit and loss item).
The website to disclose the interim announcements on significant related-party transactions
Date of disclosing Description of the website for disclosing
Description of provisional announcement
provisional announcement provisional announcements
Announcement of Resolutions of the 8th Meeting of August 28,2021 See details in the company’s
76
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
the Ninth Board of Directors announcement published on securities
times, Hongkong Commercial daily and
http//www.cninfo.com.cn .Announcemen
t No.:2021-043
Announcement on Transfer of Plant and Land Assets August 28,2021 Announcement No.:2021-048
Announcement of Resolutions of the 9th Meeting of
October 11,2021 Announcement No.:2021-052
the Ninth Board of Directors
Announcement on the public listing for transfer of
October 11,2021 Announcement No.:2021-054
plant and land assets
Asset evaluation report of 106 workshop and land use
right real estate project planned to disposal by October 11,2021 Announcement No.:2021-057
Chongqing Construction Automobile System Co., Ltd.
Asset evaluation report of the project for 66 (sets) of
equipment planned to disposal by Chongqing Jianshe October 11,2021 Announcement No.:2021-058
Automobile System Co., Ltd
Asset evaluation Instruction of 106 workshop and land
use right real estate project planned to disposal by October 11,2021 Announcement No.:2021-059
Chongqing Jianshe Automobile System Co., Ltd.
Asset evaluation Instruction of the project for 66 (sets)
of equipment planned to disposal by Chongqing October 11,2021 Announcement No.:2021-060
Construction Automobile System Co., Ltd
Announcement of the resolution of the second
October 11,2021 Announcement No.:2021-062
extraordinary general meeting of shareholders in 2021
Announcement of Resolutions of the 11th Meeting of
December 6,2021 Announcement No.:2021-068
the Ninth Board of Directors
Announcement of Resolutions of the 12th Meeting of
January 10,2022 Announcement No.:2022-001
the Ninth Board of Directors
Progress Announcement on the public listing for
February 19,2022 Announcement No.:2022-015
transfer of plant and land assets
Progress Announcement on the public listing for
February 24,2022 Announcement No.:2022-016
transfer of plant and land assets
Progress Announcement on the public listing for
May 11,2022 Announcement No.:2022-050
transfer of plant and land assets
77
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
XV. Significant contracts and execution
1.Entrustments, contracting and leasing
（1）Entrustment
□Applicable √ Not applicable
No such cases in the reporting period.
（2）Contracting
□Applicable √ Not applicable
No such cases in the reporting period.
（3）Leasing
□Applicable √ Not applicable
No such cases in the reporting period.
2.Significant Guarantees
√ Applicable □ Not applicable
InRMB10,000
Guarantee of the Company for the controlling subsidiaries (Exclude controlled subsidiaries)
Relevant
disclosur
Guarantee
e Date of
Name of Amount Guaranty Counter- Complete for
date/No. happening Actual
the of （If guarantee Guarantee implementatio associated
of (Date of mount of Guarantee type
Compan Guarante term n parties
the signing guarantee any） （If any）
y e or not (Yes or
guarante agreement)
no)
ed
amount
Total amount of approved Total actually amount of
external guarantee in the report 0 external guarantee in the report 0
period(A1) period(A2)
Total amount of approved 0 Total actually amount of 0
78
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
external guarantee at the end of external guarantee at the end of
the report period(A3) the report period(A4)
Guarantee of the company for its subsidiaries
Relevant Guarantee
Date of
disclosure Guaranty Complete for
happening Actual Counter-
Name of the date/No. of Amount of Guarantee implementatio associated
(Date of mount of Guarantee type （If guarantee
Company the Guarantee term n parties
signing guarantee any） （If any）
guaranteed or not (Yes or
agreement)
amount no)
Vehicle air
January 19,2021 1,771 January 15,2021 1,771 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 19,2021 1,750 July 15,2021 1,750 Joint liabilities 6 months Yes No
conditioner
Vehicle air
January 19,2021 5,000 March 5,2021 5,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 19,2021 2,000 April 9,2021 2,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 19,2021 2,549 April 23,2021 2,549 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 19,2021 3,450 May 13,2021 3,450 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 19,2021 2,000 June 11,2021 2,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 19,2021 1,750 December 9,2021 1,750 Joint liabilities 7 months Yes No
conditioner
Vehicle air
January 19,2021 2,501 December 14,2021 2,501 Joint liabilities 6 months Yes No
conditioner
Vehicle air
January 22,2022 1,000 September 17,2021 1,000 Joint liabilities 12 months Yes No
conditioner
Vehicle air
January 22,2022 2,600 April 20,2022 2,600 Joint liabilities 12 months No No
conditioner
Vehicle air
January 22,2022 1,949 April 27,2022 1,949 Joint liabilities 12 months No No
conditioner
Vehicle air
January 22,2022 1,250 May 10,2022 1,250 Joint liabilities 12 months No No
conditioner
Vehicle air
January 22,2022 2,000 May 17,2022 2,000 Joint liabilities 12 months No No
conditioner
Vehicle air
January 22,2022 1,460 May 23,2022 1,460 Joint liabilities 12 months No No
conditioner
Vehicle air
January 22,2022 2,501.35 June 14,2022 2,501.35 Joint liabilities 12 months No No
conditioner
Vehicle air
January 22,2022 1,750 June 29,2022 1,750 Joint liabilities 12 months No No
conditioner
Total of guarantee to subsidiaries approved in Total of guarantee to
the report term (B1) 61,000 subsidiaries actually occurred in 13,510
79
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
the report term (B2)
Total of balance of guarantee
Total of guarantee to subsidiaries approved as actually provided to the
61,000 13,510
of the report term (B3) subsidiaries as of end of report
term (B4)
Guarantee of the subsidiaries for its subsidiaries
Relevant Guarantee
Date of
Name of disclosure Guaranty Counter- Complete for
happening Actual
the date/No. of Amount of Guarantee implementatio associated
(Date of mount of Guarantee type （If guarantee
Compan the Guarantee term n parties
signing guarantee any） （If any）
y guaranteed or not (Yes or
agreement)
amount no)
Total of guarantee to
Total of guarantee to subsidiaries approved in
0 subsidiaries actually occurred in 0
the report term (C1)
the report term (C2)
Total of balance of guarantee
Total of guarantee to subsidiaries approved as actually provided to the
0 0
of the report term (C3) subsidiaries as of end of report
term (C4)
The Company’s total guarantee(i.e.total of the first three main items)
Total amount of guarantee
Total guarantee
quota approved in actually incurred in the
the reporting period 61,000 13,510
（A1+B1+C1） reporting period
（A2+B2+C2）
Total guarantee
quota already Total balance of the actual
approved at the guarantee at the end of the
61,000 13,510
end of the reporting period
reporting period （A4+B4+C4）
（A3+B3+C3）
The proportion of the total amount of actually guarantee in the net assets of the
121.61%
Company (that is A4+B4+C4）%
Including：
Amount of guarantees provided for shareholders, the actual
controller and their related parties (D) 0
80
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Amount of debt guarantees provided directly or indirectly for
13,510
entities with a liability-to-asset ratio over 70% (E)
Proportion of total amount of guarantee in net assets of the
79,554,358
company exceed 50%（F）
Total amount of the three kinds of guarantees above (D+E+F) 13,510
Explanations about joint and several liability for repayment in
None
respect of undue guarantee(if any)
Explanation about external guarantee violating established
None
procedure if any）
81
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
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. Other significant contract
□ Applicable √ Not applicable
Not-existent
XVI. Explanation on other significant events
√ Applicable □ Not applicable
1. Explanation of the Company's uncovered losses amounting to one-third of the total paid-in share capital
As audited by Da Hua Certified Public Accountants (LLP), as of December 31, 2022, the cumulative
amount of undistributed profit in the Company's consolidated statement was -1,095,779,478.64 yuan, the
Company's uncovered loss was -1,095,779,478.64 yuan, the Company's total paid-in capital was
119,375,000.00 yuan, and the Company's uncovered loss exceeded one-third of the total paid-in capital.
The reason for the formation of uncovered losses: From the late nineties of last century to the beginning of this
century, the Company's original main motorcycle business was affected by the sharp decline in the domestic
motorcycle industry, and the Company's performance suffered losses for many years. After the Company's
uncovered loss exceeded one-third of the total paid-in share capital firstly occurred at the end of 1998, the
Company had accumulated a relatively high undistributed profit (-1,095,779,478.64 yuan) until the end of 2022,
and the uncovered loss has been in a situation all the time that it has exceeded one-third of the total paid-in
share capital (470 million yuan or 119 million yuan).
2. Major matters already disclosed in the current year
Name Date of disclosure Website for disclosure
Announcement on amending the Articles of http//www.cninfo.com.cn.Announcement
January 22,2022
Association No.:2022-008
Announcement on amending the Rules of http//www.cninfo.com.cn.Announcement
January 22,2022
Procedure of the Board of Directors No.:2022-010
Announcement on adjusting organizational http//www.cninfo.com.cn.Announcement
January 22,2022
structure No.:2022-013
Announcement on accepting financial services and http//www.cninfo.com.cn.Announcement
April 30,2022
related transactions No.:2022-036
Announcement on amending the Working Rules of http//www.cninfo.com.cn.Announcement
April 30,2022
the Strategy Committee No.:2022-036
82
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Announcement on amending the Working Rules of http//www.cninfo.com.cn.Announcement
April 30,2022
the Audit Committee No.:2022-037
Announcement on amending the Working Rules of http//www.cninfo.com.cn.Announcement
April 30,2022
the Remuneration and Appraisal Committee No.:2022-038
Announcement on amending the Working Rules of http//www.cninfo.com.cn.Announcement
April 30,2022
the General Manager No.:2022-039
Announcement on amending the Administrative
http//www.cninfo.com.cn.Announcement
Measures for Authorization by the Board of April 30,2022
No.:2022-040
Directors
Announcement on adjusting organizational http//www.cninfo.com.cn.Announcement
August 31,2022
structure No.:2022-065
http//www.cninfo.com.cn.Announcement
Announcement on changing accounting firms October 29,2022
No.:2022-074
http//www.cninfo.com.cn.Announcement
Management system for investor relations October 29,2022
No.:2022-076
XVII. Significant event of subsidiary of the Company
√ Applicable □ Not applicable
Vehicle Air Conditioning Company, a wholly-owned subsidiary of the Company, provides lubricating oil
service for air conditioning compressor assembly in the supporting business for customers of the main
machinery factory. In view of this, the automotive air conditioning company applied to the Chongqing
Municipal Bureau of Industry and Commerce to increase the "lubricating oil sales" item in its business scope,
and completed the change registration and renewed its business license on April 14, 2023.
83
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
VII. 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 Capitalization
Bonus
Share allotment of common Other Subtotal Quantity Proportion
shares
reserve fund
I. Unlisted shares 89,375,000 74.87% 0 0.00 0.00 0.00 0.00 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 persons 1,750,000 1.46% 0 0 0 0 0 1,750,000 1.46%
Share held by foreign investors 0 0.00% 0 0 0 0 0 0 0.00%
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 market 30,000,000 25.13% 0 0 0 0 0 30,000,000 25.13%
3. Foreign shares in overseas market 0 0.00% 0 0 0 0 0 0 0.00%
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
III. Total of capital shares 119,375,000 100.00% 0 0 0 0 0 119,375,000 100.00%
84
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Reasons for share changed
□Applicable √Not applicable
Approval of Change of Shares
□Applicable √Not applicable
Ownership transfer of share changes
□Applicable √Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable
to common shareholders of Company in latest year and period
□Applicable √Not applicable
Other information necessary to disclose for the company or need to disclosed under requirement from security
regulators
□ Applicable √Not applicable
2.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
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
85
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
Ⅲ.Shareholders and actual controlling shareholder
1. Number of shareholders and shareholding
In Shares
Total number
of common Total shareholders at the Total preferred shareholders at the
The total number of preferred sha
shareholders at end of the month from the end of the month from the date of
7,029 6,991 reholders voting rights restored at 0 0
the end of the date of disclosing the disclosing the annual report(if
period-end(if any)(See Notes 8)
reporting period annual repor any)(See Notes 8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Proportion of Amount of Amount of un- Number of share pledged/frozen
Shareholders Nature of shares held Number of shares held Changes in
restricted shares restricted shares
shareholder at period -end reporting period State of share Amount
（%） held held
China Military Equipment State-owned
71.13% 84,906,250 0 84,906,250.00 0
Group Co., Ltd. legal person
Domestic
Gu Zuocheng 1.89% 2,261,000 0 2,218,750.00 42,250
natural person
Anhui Hengsheng Domestic non-
Investment Development state-owned 1.47% 1,750,000 0 1,750,000.00 0
Co., Ltd. legal person
Domestic
Xu Yuanhui 0.81% 967,999 54000 0 967,999
natural person
Domestic
Liu Dan 0.74% 880,376 -100 0 880,376
natural person
Domestic
Chen Xinqiang 0.51% 612,400 0 0 612,400
natural person
CORE PACIFIC-
YAMAICHI Overseas Legal
0.51% 605,650 61500 0 605,650
INTERNATIONAL (H.K.) person
LIMITED
Domestic
Zhang Meilan 0.43% 513,560 0 0 513,560
natural person
Domestic
Feng Yonghui 0.42% 500,000 0 500,000 0
natural person
Domestic
Chen Houping 0.36% 423,800 239 0 423,800
natural person
Strategic investor or general legal person
becoming top-10 ordinary shareholder due to Not applicable
rights issue (if any)（See Note 3)
86
Chongqing Jianshe Vehicle System Co., Ltd. 2022 Annual Report
There isn’t any associated relationship between the sponsoring shareholder and the other shareholders among the top-10 list. None of them are
Related or acting-in-concert parties among
regarded as ‘Acting in concert’ in accordance with ‘The rules of information disclosure on change of shareholding.’ Foreign shareholders are
shareholders above
unknown for their condition of ‘Associated relationship’ and ‘Acting in concert’.
Above shareholders entrusting or entrusted
Not applicable
with voting rights, or waiving voting rights
Top 10 shareholders including the special
Not applicable
account for repurchase (if any) (see note 10)
Top 10 holders of unconditional shares
Amount of unconditional shares held at end of Category of shares
Name of the shareholder
period Category of shares Amount
Xu Yuanhui 967,999 Foreign shares placed in domestic exchange 967,999
Liu Dan 880,376 Foreign shares placed in domestic exchange 880,376
Chen Xinqiang 612,400 Foreign shares placed in domestic exchange 612,400
CORE PACIFIC-YAMAICHI
605,650 Foreign shares placed in domestic exchange 605,650
INTERNATIONAL (H.K.) LIMITED
Zhang Meilan 513,560 Foreign shares placed in domestic exchange 513,560
Chen Houping 423,800 Foreign shares placed in domestic exchange 423,800
Li Jianping 422,500 Foreign shares placed in domestic exchange 422,500
Lv Gang 418,099 Foreign shares placed in domestic exchange 418,099
Zhang Long 351,577 Foreign shares placed in domestic exchange 351,577
Liu Guosheng 345,575 Foreign shares placed in domestic exchange 345,575
There is no affiliated relationship between the top ten non-restricted tradable shareholders and the controlling shareholder China Military
Action-in-concert among top 10 non-restricted Equipment Group Co., Ltd. nor do they belong to the consistent actors stipulated in the Administrative Measures for the Acquisition of Listed
current share holders, top 10 non-restricted Companies; it is unknown to the company whether there is an affiliated relationship between the top ten non-restricted tradable shareholders as
current share holders and top 10 shareholders 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
Not applicable
securities margin trading (if any) (see note 4)
87
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/ Organization code Principal business activities
incorporation
shareholder Leader
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 of
China Military vehicles, electrical equipment,
Equipment Group Co., Xu Xianpng June 29,1999 91110000710924929L photoelectric information and
Ltd. products and their equipment,
mechanical equipment,
engineering and construction
machinery, chemical materials
(except hazardous chemicals),
fire fighting equipment,
medical and environmental
protection equipment, metal
and nonmetal materials and
their products.
As of December 31, 2022 Shares held and controlled by other domestic and overseas listed companies
Equity of other
directly or indirectly: 1. 40.70% by Chongqing Changan Automobile Co., Ltd.( Stock code:000625); 2.
domestic/foreign listed
company with share 45.40 by Baoding Tianwei Baobian Electric Co., ltd(Stock code: 600550).; 3.41.03% by Jiangling
controlling and share Motors Corporation, Ltd（Stock code:000550）；4. 37.40% by Hunan Tianyan Machinery Co.,
participation by Ltd(Stock code: 600698）；5. 49.94% by Haerbin Automobile Power Co., Ltd.；6.42.00 by Costar
controlling shareholder Group Co., Ltd.(Stock Code002189）；7. 55.61% by Yunnan Xiyi Industry Co., Ltd(Stock
in reporting period code:002265）；8. 25.44% by Chongqing Minsheng Logistic Co., Ltd( Stock code:1292.HK）；
9.70.35% by Hubei Huangqiang High-Tech Co., Ltd.(Stock；688151）
Change of holding shareholder
□ Applicable √ Not applicable
No such cases in the reporting period.
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 Director of SASAC Not applicable Not applicable
State Council
Situation of domestic and abroad
holding listed companies Not applicable
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
The actual controller controls the company by means of trust or managing the assets in other way
□Applicable √Not applicable
4.The cumulative number of shares pledged by the controlling shareholder or the largest shareholder of the
company and its person acting in concert accounts for 80% of the number of shares held by the company
□Applicable √Not applicable
5.Particulars about other legal person shareholders with over 10% share held
□Applicable √Not applicable
6.Situation of Share Limitation Reduction of Controlling Shareholders, Actual Controllers, Restructuring Party
and Other Commitment Subjects
□Applicable √Not applicable
IV. Specific implementation of share repurchase during the reporting period
Progress in implementation of share repurchase
□ Applicable √Not applicable
Implementation progress of reducing repurchased shares by centralized bidding
□ Applicable √Not applicable
VIII. Situation of the Preferred Shares
□Applicable √Not applicable
The Company had no preferred shares in the reporting period.
IX. Corporate Bond
□ Applicable √Not applicable
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
AUDITOR'S REPORT
DHSZ [2023] NO. 003251
Da Hua CPAs LLP
Chongqing Jianshe Vehicle System Co., Ltd.
Auditor's Report and Financial Statements
(From January 1, 2022 to December 31, 2022)
Table of Contents Page
I. Auditor's Report 1-4
II. Audited Financial Statements
Consolidated Balance Sheets 1-2
Consolidated Income Statements 3
Consolidated Statement of Cash Flows 4
Consolidated Statement of Changes in Shareholders' Equity 5-6
Parent Company’s Balance Sheet 7-8
Parent Company’s Income Statement 9
Parent Company’s Statement of Cash Flows 10
Parent Company’s Statement of Changes in Shareholders' Equity 11-12
Notes to the Financial Statements 1-89
Da Hua CPAs LLP
Floor 12, Building 7, Yard 16, West Fourth Ring Road, Haidian District, Beijing [100039]
Tel.: 86 (10) 5835 0011 Fax: 86 (10) 5835 0006
www.dahua-cpa.com
Auditor's Report
DHSZ [2023] No. 003251
To all shareholders of Chongqing Jianshe Vehicle System Co., Ltd.:
I. Opinion
We have audited the accompanying financial statements of Chongqing Jianshe Vehicle System Co.,
Ltd.(hereinafter referred to as "the Company"), which comprise the consolidated balance sheet and
the parent company's balance sheet as at December 31, 2022, the consolidated income statement and
the parent company's income statement, the consolidated statement of cash flows and the parent
company's statement of cash flows, and the consolidated statement of changes in shareholders’ equity
and the parent company's statement of changes in shareholders’ equity for the year ended December
31, 2022 as well as the notes to the relevant financial statements.
In our opinion, the financial statements attached are prepared, in all material respects, in accordance
with the Accounting Standards for Business Enterprises, and fairly present the Company’s
consolidated financial position and parent company's financial position as at December 31, 2022 and
its consolidated operating results and cash flows and parent company's operating results and cash
flows for the year then ended.
II. Basis for Opinion
We conducted our audit in accordance with Auditing Standards for Certified Public Accountants in
China. Our responsibilities under those standards are further described in the Auditor's
Responsibilities for the Audit of the Financial Statements section of our report. We are independent of
the Company in accordance with the Code of Ethics for Professional Accountants of the Chinese
Institute of Certified Public Accountants (“CICPA Code”), and we have fulfilled our other ethical
responsibilities in accordance with the CICPA Code. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
We determine to communicate the following key audit matters in the auditors' report.
(I) Revenue recognition
1. Descriptions of key audit matters
Please refer to Note 3.33 and Note 5.32 of the consolidated financial statements for the
accounting policies and book amount related to revenue recognition of the Company.
The main business of the Company is the production and sales of automobile air-
conditioning compressors, provision of supporting services for automotive OEMs. As
revenue is one of key performance indicators of the Company, we regard the
Company's revenue recognition as a key audit matter.
Page 1
Auditor's Report DHSZ [2023] No.003251
2. How our audit addressed the matter
Significant audit procedures implemented for the revenue recognition include:
(1) We obtained the internal control system related to the Company's sales cycle,
analyzed its rationality and tested its operational effectiveness.
(2) Obtained the main sales contract, checked the cooperation mode, main contract
terms and settlement mode, and made a comparison with the revenue
recognition policy actually implemented by the Company;
(3) Obtained the detailed list of sales revenue and costs, and executed the analysis
program for the changes of sales revenue and gross profit margin;
(4) Conducted detail tests and sampled sales contract, customer billing notice,
customer acceptance certificate and bank receipt, etc. for check;
(5) Implemented the revenue cut-off tests, and checked the sales revenue confirmed
before and after the balance sheet date, customer acceptance list and customer
billing notice;
(6) Selected samples of the ending balance of accounts receivable and the current
income for certification.
Based on the audit procedures executed, we believe that the revenue recognition of the
Company meets accounting policies.
IV. Other Information
The Management of the Company shall be responsible for other information. The other information
comprises the information covered in the 2022 annual report of the Company, but excludes the
financial statements and our auditor's report.
Our opinion on the financial statements does not cover the other information, and we do not and will
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 identified above 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 on the other information, we conclude that there is a
material misstatement of the other information, we are required to report that fact. However, we have
nothing to report in this regard.
V. Responsibilities of Management and Those Charged with Governance for the Financial
Statements
The Management is responsible for the preparation and fair presentation of the financial statements in
accordance with the requirements of Accounting Standards for Business Enterprises, and for such
internal control as management determines is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
Page 2
Auditor's Report DHSZ [2023] No.003251
In preparing the financial statements, the Management is responsible for assessing the Company’s
going-concern ability, disclosing the matters related to going concern (if applicable) and using the
going-concern assumption unless the Management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the financial reporting process of the
Company.
VI. Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the audit standards will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually
or in aggregate, they could reasonably be expected to influence the economic decisions of users taken
on the basis of these financial statements.
As part of an audit in accordance with CSAs, we exercise professional 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 by and the reasonableness of
accounting estimates and related disclosures made by the Management.
4. Conclude on the appropriateness of the Management's use of the going-concern assumption.
Meanwhile, according to the audit evidence acquired, the management comes to conclusion on
matters which may cause significant misgiving against the going-concern ability of the
Company or whether the said situation exists material uncertainty or not. If we conclude that a
material uncertainty exists, we are required to, in our auditors' report, draw attention of the
users of reports to the related disclosures in the financial statements; if such disclosures are
inadequate, we should 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 financial statements' overall presentation, structure and contents, and whether the
financial statements fairly represent the underlying transactions and events.
6. Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities of the Company to express an opinion on the financial statements. We are
responsible for the direction, supervision and performance of the group audit, and bear
interests’ full responsibility for our audit opinion.
Page 3
Auditor's Report DHSZ [2023] No.003251
We communicate with those charged with governance regarding the planned scope and timing of the audit,
significant audit findings and other matters, 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 in regard to all relationships and other
matters that may reasonably be thought to affect our independence, and related safeguards (if applicable).
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.
Da Hua CPAs LLP Certified Public Accountant of China:
(Engagement Partner)
Xu Shibao
Certified Public Accountant of China:
Xie Jun
Beijing, China April 27, 2023
Page 4
Auditor's Report DHSZ [2023] No.003251
Consolidated Balance Sheet
As at December 31, 2022
Prepared by: Chongqing Jianshe
(Amounts are expressed in RMB unless otherwise stated)
Vehicle System Co., Ltd.
Balance as at December 31, Balance as at December 31,
Assets Note 5
2022 2021
Current assets:
Monetary funds 5.1 179,954,522.99 91,678,523.19
Financial assets held for trading
Derivative financial assets
Notes receivable 5.2 2,220,000.00
Accounts receivable 5.3 113,710,214.72 149,333,285.64
Receivables financing 5.4 17,548,591.75 29,250,840.86
Advances to suppliers 5.5 4,024,366.02 7,228,480.93
Other receivables 5.6 1,720,044.17 1,431,664.33
Inventories 5.7 131,860,572.93 206,719,605.79
Contract assets
Assets held for sale 5.8 104,982,996.11
Non-current assets maturing within one
year
Other current assets 5.9 1,468,399.16 4,585,170.16
Total current assets 450,286,711.74 597,430,567.01
Non-current assets:
Creditor's right investments
Other creditor's right investments
Long-term receivables
Long-term equity investments 5.10 210,112,321.04 201,984,268.72
Other equity instrument investments
Other non-current financial assets 5.11
Investment properties
Fixed assets 5.12 202,039,143.80 216,541,481.98
Construction in progress 5.13 989,429.96 1,811,125.46
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 5.14 11,801,504.95 13,580,639.04
Development expenses
Goodwill
Long-term deferred expenses 5.15 70,280.65 116,978.77
Deferred income tax assets 5.16 5,752,057.03 6,060,617.99
Other non-current assets 5.17 15,860,120.00 3,810,800.00
Total non-current assets 446,624,857.43 443,905,911.96
Total assets 896,911,569.17 1,041,336,478.97
Page 5
Auditor's Report DHSZ [2023] No.003251
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Consolidated Balance Sheet (Continued)
As at December 31, 2022
Prepared by: Chongqing Jianshe Vehicle (Amounts are expressed in
System Co., Ltd. RMB unless otherwise stated)
Balance as at December 31, Balance as at December 31,
Liabilities and shareholders' equity Note 5
2022 2021
Current liabilities:
Short-term borrowings 5.18 546,603,500.00 493,460,000.00
Financial liabilities held for trading - -
Derivative financial liabilities - -
Notes payable 5.19 30,379,988.94 160,670,000.00
Accounts payable 5.20 171,190,476.10 190,292,444.13
Advances from customers
Contract liabilities 5.21 3,441,205.38 2,868,604.98
Employee compensation payable 5.22 8,529,392.78 20,944,522.89
Taxes and surcharges payable 5.23 16,649,704.07 15,134,121.83
Other payables 5.24 7,566,872.62 6,766,954.83
Liabilities held for sale
Non-current liabilities maturing within
one year
5.25 447,356.63 372,918.65
Other current liabilities
Total current liabilities 784,808,496.52 890,509,567.31
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: preferred stocks
Perpetual bonds
Lease liabilities
Long-term payables
Long-term employee compensation
payable
Estimated liabilities
Deferred income
Deferred income tax liabilities 5.16 1,011,787.97 1,523,318.82
Other non-current liabilities
Total non-current liabilities 1,011,787.97 1,523,318.82
Total liabilities 785,820,284.49 892,032,886.13
Shareholders' equity
Share capital 5.26 119,375,000.00 119,375,000.00
Other equity instruments
Including: preferred stocks
Perpetual bonds
Capital reserves 5.27 958,565,294.29 958,565,294.29
Less: treasury stock
Other comprehensive income 5.28 9,800.00 9,800.00
Page 6
Auditor's Report DHSZ [2023] No.003251
Special reserves 5.29 3,234,669.03 1,713,882.50
Surplus reserves 5.30 125,686,000.00 125,686,000.00
Undistributed profits 5.31 -1,095,779,478.64 -1,056,046,383.95
Total equity attributable to shareholders
111,091,284.68 149,303,592.84
of the parent company
Minority equity
Total shareholders’ equity 111,091,284.68 149,303,592.84
Total liabilities and shareholders'
896,911,569.17 1,041,336,478.97
equity
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Consolidated Income Statement
For the Year Ended December 31, 2022
(Amounts are expressed in RMB unless otherwise
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd.
stated)
Item Note 5 Year 2022 Year 2021
I. Operating revenue 5.32 474,114,098.08 680,118,967.08
Less: Operating costs 5.32 450,395,435.30 586,901,822.80
Taxes and surcharges 5.33 3,754,824.57 6,707,375.25
Selling and distribution expenses 5.34 15,239,315.12 16,795,778.20
General and administrative expenses 5.35 47,721,110.67 62,047,629.17
Research and development expenses 5.36 30,598,868.69 29,760,773.46
Financial expenses 5.37 17,472,245.88 23,014,845.65
Including: interest expenses 20,216,911.43 24,231,685.81
Interest income 1,640,888.48 1,562,787.46
Plus: Other income 5.38 1,205,689.22 1,583,305.16
Investment income ("-" for losses) 5.39 8,128,052.32 15,770,549.70
Including: income from investment in
8,128,052.32 15,770,549.70
associates and joint ventures
Gains from derecognition of financial
assets measured at amortized cost
Gains from net exposure hedging ("-"
for losses)
Gains from changes in fair value ("-"
for losses)
Losses from credit impairment ("-" for
5.40 989,437.83 -318,331.09
losses)
Losses from asset impairment ("-" for
5.41 17,064.89
losses)
Gains from disposal of assets ("-" for
5.42 40,420,431.93 1,566,473.14
losses)
II. Operating profits ("-" for losses) -40,324,090.85 -26,490,195.65
Plus: Non-operating revenue 5.43 170,256.15 319,658.55
Less: Non-operating expenses 5.44 3,112.43 198.18
III.Total profits ("-" for total losses) -40,156,947.13 -26,170,735.28
Less: Income tax expenses 5.45 -423,852.44 -171,772.56
IV. Net profit ("-" for net loss ) -39,733,094.69 -25,998,962.72
Including: net profit of the combinee under
the business combination under common
control before the business combination
Page 7
Auditor's Report DHSZ [2023] No.003251
(I) Classified by operating sustainability
Net profit from continued operation ("-"
-39,733,094.69 -25,998,962.72
for net loss)
Net profit from discontinued operation
("-" for net loss)
(II) Classified by ownership
Net profit attributable to owners of the
-39,733,094.69 -25,998,962.72
parent company (“-” for net loss)
Minority interest income ("-" for net
loss)
V. Other comprehensive income, net of tax
Other comprehensive income, net of tax,
attributable to owners of the parent
company
(I) Other comprehensive income that
cannot be reclassified into profit or loss
Net Changes in re-measurement of the
1
defined benefit plan
Other comprehensive income that cannot
2 be transferred to profit or loss under the
equity method
Changes in fair value of other equity
3
instrument investments
Changes in the fair value of the
4
company's own credit risk
5 Others
(II) Other comprehensive income that will
be reclassified into profit or loss
Other comprehensive income that can be
1 transferred to profit or loss under the
equity method
Changes in fair value of other creditor's
2
right investments
Amount of financial assets reclassified
3
into other comprehensive income
Provision for credit impairment of other
4
creditor's right investments
5 Cash flow hedging reserve
Differences arising from translation of
6
foreign-currency financial statements
Disposal of the investment income
7 generated by subsidiaries in a package
before the loss of control
Other assets converted into investment
8 properties measured using the fair value
model
9 Others
Other comprehensive income, net of tax
attributable to minority shareholders
VI. Total comprehensive income -39,733,094.69 -25,998,962.72
Total comprehensive income attributable to
-39,733,094.69 -25,998,962.72
owners of the parent company
Total comprehensive income attributable to
minority shareholders
VII. Earnings per share:
(I) Basic earnings per share -0.33 -0.22
(II) Diluted earnings per share -0.33 -0.22
(The accompanying notes to the financial statements form an integral part of the consolidated financial
statements)
Page 8
Auditor's Report DHSZ [2023] No.003251
Legal Representative: Accounting Principal: Head of the Accounting Department:
Consolidated Statement of Cash Flows
For the Year Ended December 31, 2022
(Amounts are expressed in RMB unless otherwise
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd.
stated)
Item Note 5 Year 2022 Year 2021
I. Cash flows from operating activities:
Cash received from sale of goods and
455,186,338.69 573,159,596.26
rendering of services
Refund of taxes and surcharges 10,282,411.62 20,826,397.73
Cash received from other operating activities 5.46 12,374,241.54 9,842,241.82
Sub-total of cash inflows from operating
477,842,991.85 603,828,235.81
activities
Cash paid for goods purchased and services
320,316,578.74 432,450,100.21
received
Cash paid to and on behalf of employees 107,843,217.38 111,795,006.58
Cash paid for taxes and surcharges 15,295,146.76 13,624,159.14
Cash paid for other operating activities 5.46 21,978,449.88 24,526,602.41
Sub-total of cash outflows from operating
465,433,392.76 582,395,868.34
activities
Net cash flows from operating activities 12,409,599.09 21,432,367.47
II. Cash flows from investing activities:
Cash received from disinvestment
Cash received from investment income
Net cash received from disposal of fixed
assets, intangible assets and other long-term 153,543,148.36 1,609,454.58
assets
Net cash received from disposal of
subsidiaries and other business units
Cash received from other investing activities
Sub-total of cash inflows from investing
153,543,148.36 1,609,454.58
activities
Cash paid to acquire and construct fixed
assets, intangible assets and other long-term 26,166,782.57 12,003,935.51
assets
Cash paid for investments
Net cash paid to acquire subsidiaries and
other business units
Cash paid for other investing activities
Sub-total of cash outflows from investing
26,166,782.57 12,003,935.51
activities
Net cash flows from investing activities 127,376,365.79 -10,394,480.93
III. Cash flows from financing activities:
Cash received from absorption of
investments
Including: cash received by subsidiaries
from investment by minority shareholders
Cash received from borrowings 650,903,500.00 673,010,000.00
Cash received from other financing activities 5.46 81,688,328.08 43,814,318.47
Sub-total of cash inflows from financing
732,591,828.08 716,824,318.47
activities
Cash paid for debts repayments 597,760,000.00 733,460,000.00
Page 9
Auditor's Report DHSZ [2023] No.003251
Cash paid for distribution of dividends and
20,216,911.43 24,166,086.12
profits or payment of interest
Including: dividends and profits paid to
minority shareholders by subsidiaries
Note
Cash paid for other financing activities 108,137,271.47 25,795,639.32
46
Sub-total of cash outflows from financing
726,114,182.90 783,421,725.44
activities
Net cash flows from financing activities 6,477,645.18 -66,597,406.97
IV. Effect of fluctuation in exchange rate on
-7,599.20 -12,209.93
cash and cash equivalents
V. Net increase in cash and cash equivalents 146,256,010.86 -55,571,730.36
Plus: beginning balance of cash and cash
23,738,523.19 79,310,253.55
equivalents
VI. Ending balance of cash and cash
169,994,534.05 23,738,523.19
equivalents
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
[Note 1]: "Net cash received from the disposal of subsidiaries and other business units" shall be presented at the
net amount of cash received from the disposal price, minus the cash and cash equivalents held by the subsidiary or
other business units and related disposal expenses. If the net amount is negative, the amount should be filled in the
item “Cash paid for other investing activities”. If the amount of cash or cash equivalents held by subsidiaries or
other business units disposed of is significant, a separate item of decrease in cash due to disposal of subsidiaries
shall be added for presentation.
[Note 2]: "Net cash paid to acquire subsidiaries and other business units" present the net amount of the cash part
paid for the purchase price of the subsidiaries and other business units obtained by the enterprise, minus the cash
and cash equivalents held by subsidiaries or other business units. If the net amount is negative, the amount should
be presented in the item “Cash received from other investment activities”. If the amount of cash or cash
equivalents held by subsidiaries or other business units obtained is significant, a separate item of “ cash received
from acquisition of subsidiaries”shall be added for presentation.
Page 10
Da Hua CPAs LLP
Floor 12, Building 7, Yard 16, West Fourth Ring Road, Haidian District, Beijing [100039]
Tel.: 86 (10) 5835 0011 Fax: 86 (10) 5835 0006
www.dahua-cpa.com
Consolidated Statement of Changes in Shareholders' Equity
For the Year Ended December 31, 2022
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd. (Amounts are expressed in RMB unless otherwise stated)
Year 2022
Equity attributable to the shareholders of parent company
Item Other equity instruments Other Mino Total
Less: rity sharehold
Share Capital compreh Special Surplus
treasur Undistribut equit ers’ equity
capital Preferred Perpetual Others reserves ensive reserves reserves
y stock ed profits y
stock bonds income
-
I. Balance as at December 31, 119,375, 958,565, 1,713,88 125,686,00 149,303,5
9,800.00 1,056,046,3
2021 000.00 294.29 2.50 0.00 92.84
83.95
Plus: changes in accounting
policies
Adjustments for correction of
accounting errors in prior year
Business combination under
common control
Others
-
II. Balance as at January 1, 119,375, 958,565, 1,713,88 125,686,00 149,303,5
9,800.00 1,056,046,3
2022 000.00 294.29 2.50 0.00 92.84
83.95
- -
1,520,78
III. Increase/decrease in 2022 39,733,094. 38,212,30
- 6.53
69 8.16
- -
(I) Total comprehensive income 39,733,094. 39,733,09
-
69 4.69
(II) Capital contributed or
reduced by shareholders
Page 1
Auditor's Report DHSZ [2023] No.003251
1. Common stock contributed
by shareholders
2. Capital contributed by the
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
shareholders' equity
4. Others
(III) Profit distribution
1. Withdrawal of surplus
reserves
2. Profit distributed to
shareholders
3. Others
(IV) Internal carry-forward of
shareholders’ equity
1. Conversion of capital
reserves into paid-in capital
2. Conversion of surplus
reserves into share capital
3. Surplus reserves offsetting
losses
4. Carry-forward of changes in
the defined benefit plan for
retained earnings
5. Carry-forward of other
comprehensive income for
retained earnings
6. Others
1,520,78 1,520,786.
(V) Special reserves
6.53 53
2,673,873.
1. Amount withdrawn in 2022 2,673,87
52
3.52
- -
2. Amount used in 2022
1,153,08 1,153,086.
Page 2
Auditor's Report DHSZ [2023] No.003251
6.99 99
(VI) Others
-
IV. Balance as at December 31, 119,375, 958,565, 3,234,66 125,686,00 111,091,2
9,800.00 1,095,779,4
2022 000.00 294.29 9.03 0.00 84.68
78.64
(The accompanying notes to the
financial statements form an
Legal Representative: Accounting Principal: Head of the Accounting Department:
integral part of the consolidated
financial statements)
Consolidated Statement of Changes in Shareholders' Equity
For the Year Ended December 31, 2022
(Amounts are expressed in RMB unless otherwise stated)
Year 2021
Equity attributable to shareholders of the parent company
Item Other equity instruments Other Mino Total
Less: rity sharehold
Share Capital compreh Special Surplus
treasur Undistribut equit ers’ equity
capital Preferred Perpetual Others reserves ensive reserves reserves
y stock ed profits y
stock bonds income
-
I. Balance as at December 31, 119,375, 958,565, 125,686,00 173,588,6
9,800.00 1,030,047,
2021 000.00 294.29 0.00 73.06
421.23
Plus: changes in accounting
policies
Adjustments for correction of
accounting errors in prior year
Business combination under
common control
Others
-
II. Balance as at January 1, 119,375, 958,565, 125,686,00 173,588,6
9,800.00 1,030,047,
2022 000.00 294.29 0.00 73.06
421.23
Page 3
Auditor's Report DHSZ [2023] No.003251
- -
1,713,88
III. Increase/decrease in 2022 25,998,962 24,285,08
2.50
.72 0.22
- -
(I) Total comprehensive income 25,998,962 25,998,96
.72 2.72
(II) Capital contributed or
reduced by shareholders
1. Common stock contributed
by shareholders
2. Capital contributed by the
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
shareholders' equity
4. Others
(III) Profit distribution
1. Withdrawal of surplus
reserves
2. Profit distributed to
shareholders
3. Others
(IV) Internal carry-forward of
shareholders’ equity
1. Conversion of capital
reserves into paid-in capital
2. Conversion of surplus
reserves into share capital
3. Surplus reserves offsetting
losses
4. Carry-forward of changes in
the defined benefit plan for
retained earnings
5. Carry-forward of other
comprehensive income for
retained earnings
Page 4
Auditor's Report DHSZ [2023] No.003251
6. Others
1,713,88 1,713,882.
(V) Special reserves
2.50 50
2,710,54 2,710,546.
1. Amount withdrawn in 2022
6.82 82
- -
2. Amount used in 2022 996,664. 996,664.3
32 2
(VI) Others
-
IV. Balance as at December 31, 119,375, 958,565, 1,713,88 125,686,00 149,303,5
9,800.00 1,056,046,
2022 000.00 294.29 2.50 0.00 92.84
383.95
(The accompanying notes to the
financial statements form an
integral part of the consolidated
financial statements)
Page 5
Da Hua CPAs LLP
Floor 12, Building 7, Yard 16, West Fourth Ring Road, Haidian District, Beijing [100039]
Tel.: 86 (10) 5835 0011 Fax: 86 (10) 5835 0006
www.dahua-cpa.com
Parent Company’s Balance Sheet
As at December 31, 2022
Prepared by: Chongqing Jianshe Vehicle (Amounts are expressed in RMB unless
System Co., Ltd. otherwise stated)
No
Balance as at
Assets te Balance as at December 31, 2021
December 31, 2022
12
Current assets:
Monetary funds 19,632,308.54 2,146,167.36
Financial assets held for trading
Derivative financial assets
Notes receivable
12.
Accounts receivable 3,266,890.00 3,152,475.45
1
Receivables financing 440,000.00
Advances to suppliers 2,796,181.98 2,465,664.66
12.
Other receivables 1,345,740.08 1,153,592.45
2
Inventories 3,992,120.63 2,084,284.76
Contract assets
Assets held for sale 104,982,996.11
Non-current assets maturing within
one year
Other current assets 26,885.79 1,523,292.88
Total current assets 31,060,127.02 117,948,473.67
Non-current assets:
Creditor's right investments
Other creditor's right investments
Long-term receivables
12.
Long-term equity investments 409,157,764.99 401,029,712.67
3
Other equity instrument investments
Other non-current financial assets
Investment properties
Fixed assets 27,476,448.18 30,608,778.01
Construction in progress 16,637.17
Productive biological assets
Oil and gas assets
Right-of-use assets
Page 1
Auditor's Report DHSZ [2023] No.003251
Intangible assets
Development expenses
Goodwill
Long-term deferred expenses
Deferred income tax assets
Other non-current assets 135,600.00
Total non-current assets 436,769,813.17 431,655,127.85
Total assets 467,829,940.19 549,603,601.52
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Parent Company’s Balance Sheet (Continued)
As at December 31, 2022
Prepared by: Chongqing Jianshe Vehicle (Amounts are expressed in
System Co., Ltd. RMB unless otherwise stated)
Balance as at December Balance as at December 31,
Liabilities and shareholders' equity Note 12
31, 2022 2021
Current liabilities:
Short-term borrowings
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payable 148,575,684.59 165,209,294.49
Advances from customers
Contract liabilities 177,064.96 159,843.70
Employee compensation payable 4,008,918.72 6,044,727.21
Taxes and surcharges payable 15,529,178.05 15,021,233.16
Other payables 273,461,451.21 355,521,343.12
Liabilities held for sale -
Non-current liabilities maturing within
one year
Other current liabilities 23,018.42 20,779.68
Total current liabilities 441,775,315.95 541,977,221.36
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: preferred stocks
Perpetual bonds
Lease liabilities
Long-term payables
Long-term employee compensation
payable
Page 2
Auditor's Report DHSZ [2023] No.003251
Estimated liabilities
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 441,775,315.95 541,977,221.36
Shareholders' equity
Share capital 119,375,000.00 119,375,000.00
Other equity instruments
Including: preferred stocks
Perpetual bonds
Capital reserves 958,565,294.29 958,565,294.29
Less: treasury stock
Other comprehensive income 9,800.00 9,800.00
Special reserves 430,254.50 612,361.09
Surplus reserves 125,686,000.00 125,686,000.00
Undistributed profits -1,178,011,724.55 -1,196,622,075.22
Total shareholders’ equity 26,054,624.24 7,626,380.16
Total liabilities and shareholders' equity 467,829,940.19 549,603,601.52
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Parent Company’s Income Statement
For the Year Ended December 31, 2022
(Amounts are expressed in RMB unless
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd.
otherwise stated)
Item Note 12 Year 2022 Year 2021
I. Operating revenue 12.4 255,751,276.44 505,387,254.89
Less: Operating costs 12.4 259,112,698.56 509,519,813.11
Taxes and surcharges 565,321.94 2,476,585.14
Selling and distribution expenses 390,581.47 415,349.38
General and administrative expenses 28,175,164.70 35,954,807.78
Research and development expenses 12,161.64 98,668.74
Financial expenses -1,437,911.62 658,011.46
Including: interest expenses 765,967.92
Interest income 132,857.64 64,826.78
Plus: Other income 990,023.53 59,403.42
Investment income ("-" for losses) 12.5 8,128,052.32 15,770,549.70
Including: income from investment in
8,128,052.32 15,770,549.70
associates and joint ventures
Gains from derecognition of financial assets
measured at amortized cost
Gains from net exposure hedging ("-" for
Page 3
Auditor's Report DHSZ [2023] No.003251
losses)
Gains from changes in fair value ("-" for
losses)
Losses from credit impairment ("-" for
losses) 237,752.50
Losses from asset impairment ("-" for losses)
Gains from disposal of assets ("-" for losses) 40,420,431.93 1,598,662.50
II. Operating profits ("-" for losses) 18,471,767.53 -26,069,612.60
Plus: Non-operating revenue 138,583.14 202,347.24
Less: Non-operating expenses
III.Total profits ("-" for total losses) 18,610,350.67 -25,867,265.36
Less: Income tax expenses
IV. Net profit ("-" for net loss ) 18,610,350.67 -25,867,265.36
(I) Net profit from continued operation ("-" for net loss) 18,610,350.67 -25,867,265.36
(II) Net profits from discontinued operation ("-" for net
losses)
V. Other comprehensive income, net of tax
(I) Other comprehensive income that cannot be
reclassified into profit or loss
Net Changes in re-measurement of the defined
1.
benefit plan
Other comprehensive income that cannot be
2. transferred to profit or loss under the equity
method
Changes in fair value of other equity
3.
instrument investments
Changes in the fair value of the Company's
4.
own credit risk
5. Others
(II) Other comprehensive income that will be
reclassified into profit or loss
Other comprehensive income that can be
1. transferred to profit or loss under the equity
method
Changes in fair value of other creditor's right
2.
investments
Amount of financial assets reclassified into
3.
other comprehensive income
Provision for credit impairment of other
4.
creditor's right investments
5. Cash flow hedging reserve
Differences arising from translation of
6.
foreign-currency financial statements
Disposal of the investment income generated
7. by subsidiaries in a package before the loss of
control
Other assets converted into investment
8.
properties measured using the fair value model
9. Others
VI. Total comprehensive income 18,610,350.67 -25,867,265.36
VII. Earnings per share:
(I) Basic earnings per share
(II) Diluted earnings per share
Page 4
Auditor's Report DHSZ [2023] No.003251
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Parent Company's Statement of Cash Flows
For the Year Ended December 31, 2022
(Amounts are expressed in RMB unless
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd.
otherwise stated)
Item Note 12 Year 2022 Year 2021
I. Cash flows from operating activities:
Cash received from sale of goods and
144,583,207.21 168,800,813.85
rendering of services
Refund of taxes and surcharges
Cash received from other operating activities 6,939,605.77 6,232,085.99
Sub-total of cash inflows from operating activities 151,522,812.98 175,032,899.84
Cash paid for goods purchased and services
149,508,190.51 150,998,598.56
received
Cash paid to and on behalf of employees 34,840,152.31 37,808,659.45
Cash paid for taxes and surcharges 9,780,875.37 5,495,048.13
Cash paid for other operating activities 7,407,611.52 9,559,906.59
Sub-total of cash outflows from operating activities 201,536,829.71 203,862,212.73
Net cash flows from operating activities -50,014,016.73 -28,829,312.89
II. Cash flows from investing activities:
Cash received from disinvestment
Cash received from investment income
Net cash received from disposal of fixed
assets, intangible assets and other long-term 153,507,597.36 1,609,454.58
assets
Net cash received from disposal of
subsidiaries and other business units
Cash received from other investing activities
Sub-total of cash inflows from investing activities 153,507,597.36 1,609,454.58
Cash paid to acquire and construct fixed
assets, intangible assets and other long-term 1,890,939.45 4,506,429.25
assets
Cash paid for investments
Net cash paid to acquire subsidiaries and
other business units
Cash paid for other investing activities
Sub-total of cash outflows from investing activities 1,890,939.45 4,506,429.25
Net cash flows from investing activities 151,616,657.91 -2,896,974.67
III. Cash flows from financing activities:
Cash received from absorption of investments
Cash received from borrowings 15,000,000.00
Cash received from other financing activities 233,343,500.00 365,599,500.00
Page 5
Auditor's Report DHSZ [2023] No.003251
Sub-total of cash inflows from financing activities 233,343,500.00 380,599,500.00
Cash paid for debts repayments 15,000,000.00
Cash paid for distribution of dividends and
765,967.92
profits or payment of interest
Cash paid for other financing activities 317,460,000.00 332,000,115.42
Sub-total of cash outflows from financing activities 317,460,000.00 347,766,083.34
Net cash flows from financing activities -84,116,500.00 32,833,416.66
IV. Effect of fluctuation in exchange rate on cash and
cash equivalents
V. Net increase in cash and cash equivalents 17,486,141.18 1,107,129.10
Plus: beginning balance of cash and cash
2,146,167.36 1,039,038.26
equivalents
VI. Ending balance of cash and cash equivalents 19,632,308.54 2,146,167.36
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Page 6
Auditor's Report DHSZ [2023] No.003251
Page 7
Da Hua CPAs LLP
Floor 12, Building 7, Yard 16, West Fourth Ring Road, Haidian District, Beijing [100039]
Tel.: 86 (10) 5835 0011 Fax: 86 (10) 5835 0006
www.dahua-cpa.com
Parent Company’s Statement of Changes in Shareholders' Equity
For the Year Ended December 31, 2022
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd. (Amounts are expressed in RMB unless otherwise stated)
Year 2022
Other equity
instruments
Other Total
Item Less: Special
Share compre Surplus shareh
Perp Capital reserves treasury reserve Undistribut
capital Preferr hensive reserves olders’
etual Othe stock s ed profits
ed income equity
bond rs
stock
s
-
119,375,00 9,800.0 612,361 125,686,0 7,626,
I. Balance as at December 31, 2021 958,565,294.29 1,196,622,
0.00 - - 0 .09 00.00 380.16
075.22
Plus: changes in accounting policies
Adjustments for correction of accounting
errors in prior year
Others
-
119,375,00 9,800.0 612,361 125,686,0 7,626,
II. Balance as at January 1, 2022 958,565,294.29 1,196,622,
0.00 0 .09 00.00 380.16
075.22
- 18,428
18,610,350
III. Increase/decrease in 2022 182,106 ,244.0
.67
.59 8
18,610
(I) Total comprehensive income 18,610,350 ,350.6
.67 7
(II) Capital contributed or reduced by
shareholders
Page 1
Auditor's Report DHSZ [2023] No.003251
1. Common stock contributed by shareholders
2. Capital contributed by the holders of other
equity instruments
3. Amounts of share-based payments
recognized in shareholders' equity
4. Others
(III) Profit distribution
1. Withdrawal of surplus reserves
2. Profit distributed to shareholders
3. Others
(IV) Internal carry-forward of shareholders’
equity
1. Conversion of capital reserves into paid-in
capital
2. Conversion of surplus reserves into share
capital
3. Surplus reserves offsetting losses
4. Carry-forward of changes in the defined
benefit plan for retained earnings
5. Carry-forward of other comprehensive
income for retained earnings
6. Others
- -
(V) Special reserves 182,106 182,10
.59 6.59
118,560 118,56
1. Amount withdrawn in 2022
.72 0.72
- -
2. Amount used in 2022 300,667 300,66
.31 7.31
(VI) Others
Page 2
Auditor's Report DHSZ [2023] No.003251
- 26,054
119,375,00 9,800.0 430,254 125,686,0
IV. Balance as at December 31, 2022 958,565,294.29 1,178,011, ,624.2
0.00 0 .50 00.00
724.55 4
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Parent Company’s Statement of Changes in Shareholders' Equity
For the Year Ended December 31, 2022
Prepared by: Chongqing Jianshe Vehicle System Co., Ltd. (Amounts are expressed in RMB unless otherwise stated)
Year 2021
Other equity
instruments
Other
Item Less: Total
Share Perp Capital comprehen Special Surplus
treasur Undistribut shareholder
capital Preferr etua reserves sive reserves reserves
Oth y stock ed profits s’ equity
ed l income
ers
stock bon
ds
-
119,375, 958,565,29 125,686,000. 32,881,284.
I. Balance as at December 31, 2021 9,800.00 1,170,754,
000.00 4.29 00 43
809.86
Plus: changes in accounting policies
Adjustments for correction of accounting
errors in prior year
Others
-
119,375, 958,565,29 125,686,000. 32,881,284.
II. Balance as at January 1, 2022 9,800.00 1,170,754,
000.00 4.29 00 43
809.86
- -
III. Increase/decrease in 2022 612,361.09 25,867,265 25,254,904.
.36 27
- -
(I) Total comprehensive income 25,867,265 25,867,265.
.36 36
Page 3
Auditor's Report DHSZ [2023] No.003251
(II) Capital contributed or reduced by
shareholders
1. Common stock contributed by
shareholders
2. Capital contributed by the holders of
other equity instruments
3. Amounts of share-based payments
recognized in shareholders' equity
4. Others
(III) Profit distribution
-
1. Withdrawal of surplus reserves
2. Profit distributed to shareholders
3. Others
(IV) Internal carry-forward of shareholders’
equity
1. Conversion of capital reserves into paid-
in capital
2. Conversion of surplus reserves into share
capital
3. Surplus reserves offsetting losses
4. Carry-forward of changes in the defined
benefit plan for retained earnings
5. Carry-forward of other comprehensive
income for retained earnings
6. Others
(V) Special reserves 612,361.09 612,361.09
1. Amount withdrawn in 2022 851,766.65 851,766.65
-
2. Amount used in 2022 -239,405.56
239,405.56
(VI) Others
Page 4
Auditor's Report DHSZ [2023] No.003251
-
119,375, 958,565,29 125,686,000. 7,626,380.1
IV. Balance as at December 31, 2022 9,800.00 612,361.09 1,196,622,
000.00 4.29 00 6
075.22
(The accompanying notes to the financial statements form an integral part of the consolidated financial statements)
Legal Representative: Accounting Principal: Head of the Accounting Department:
Page 5
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Chongqing Jianshe Vehicle System Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2022
1 Company profile
1.1 The Company's place of registration, organizational form and address of headquarters
Chongqing Jianshe Vehicle System Co., Ltd. (hereinafter referred to as "the Company”),
whose original name was Chongqing Jianshe Motorcycle Co., Ltd., was established in July
1995 by Jianshe Industry (Group) Co., Ltd. and China North Industries Shenzhen Corp. The
unified social credit code/registration No. of the Company is 915000007474824231. The
Company was listed on the Shenzhen Stock Exchange in July 1995.
On December 27, 2017, the Company announced that it had completed the relevant industrial
and commercial registration procedures for the change of its full name in Chinese, and
obtained the Notice of Approval of Change Registration from Chongqing Administration for
Industry and Commerce (YGSWZBD [2017] No.1206-1), the renewed Business License and
the approval documents of Shenzhen Stock Exchange. The company name was changed from
Chongqing Jianshe Motorcycle Co., Ltd. to Chongqing Jianshe Vehicle System Co., Ltd. The
abbreviation of the Company was changed from "Jianmo B" to "Jianche B", and the company
stock code 200054 remained unchanged.
The former controlling shareholder, Chongqing Jianshe Mechanical & Electrical Equipment
Co., Ltd. (hereinafter referred to as “Jianshe Mechanical & Electrical”), concluded the Equity
Transfer Agreement of State-owned Listed Companies with China South Industries Group
Corporation (hereinafter referred to as "CSGC") on October 22, 2018, that is, Jianshe
Mechanical & Electrical agreed to transfer 84,906,250 shares of its state-owned legal person
shares to CSGC, accounting for 71.13% of the total share capital of the Company.
The Company received the Jianchen Letter of Confirmation for Securities Transfer
Registration issued by China Securities Depository and Clearing Co., Ltd., Shenzhen Branch
on December 21, 2018, and the registration formalities for the equity transfer under this
agreement have been completed at China Securities Depository and Clearing Co., Ltd.,
Shenzhen Branch. Chongqing Jianshe Mechanical & Electrical Equipment Co., Ltd. no longer
holds the shares of the Company, and CSGC has become the controlling shareholder of the
Company, holding 84,906,250 shares of the Company, accounting for 71.13%. The shares are
legal person shares of the sponsor.
The parent company and actual controller of the Company is China South Industries Group
Corporation, and the ultimate controller is the State-owned Assets Supervision and
Administration Commission of the State Council.
As of December 31, 2022, the total share capital cumulatively issued by the Company was
119,375,000 shares. The registered capital was RMB119,375,000. Its place of registration is
No.1 Jianshe Avenue, Huaxi Industrial Park, Banan District, Chongqing. The address of the
headquarters is in Banan District, Chongqing. Legal representative: Yan Xuechuan.
1.2 Business nature and main business activities of the Company
Business scope of the Company: general items: research and development, processing and
manufacturing of motorcycles, auto parts, accessories and mechanical products and related
technical services, design and manufacturing of tooling and molds and related technical
services (excluding those items subject to special national provisions); research and
development, production and sales of motorcycle engines; research, development and
processing of mechanical and electrical products, household appliances, bicycles and
environmental protection products; import, wholesale, retail and commission agency (except
Notes to the Financial Statements Page 1
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
for auction) of similar goods (except special goods) of the above products.
The Company operates in the manufacturing industry.
1.3 Scope of consolidated financial statements
The Company has a total of 2 subsidiaries included in the scope of consolidation in 2022. See
Note 7 Equity in other entities for details. There was no change in the entities included in the
scope of consolidated financial statements in the current period compared with the previous
period.
1.4 Approval and disclosure of the financial statements
The financial statements were approved by the board of directors of the Company for
disclosure on April 27, 2023.
2 Preparation basis for financial statements
2.1 Basis for the preparation of the financial statements
According to actually occurred transactions and events, the Company conducts the recognition
and measurement in accordance with the Accounting Standards for Business Enterprises -
Basic Standards and all the specific accounting standards for enterprise, Application Guidance
to the Accounting Standards for Business Enterprises, the interpretation of the Accounting
Standards for Business Enterprises and other relevant provisions (hereinafter referred to as the
“Accounting Standards for Business Enterprises”). On this basis, the Company prepares the
financial statements in combination with the disclosure provisions of the Rules for the
Compilation and Submission of Information Disclosure by Companies Offering Securities to
the Public No. 15 - General Requirements for Financial Reports (revised in 2014) issued by
the China Securities Regulatory Commission.
2.2 Going concern
The Company has assessed the going-concern ability for 12 months as of the end of the
reporting period, and has no matter or situation bringing material doubt to the going-concern
ability. Therefore, the financial statements are prepared on the basis of going-concern
assumption.
2.3 Accounting basis and measurement principle
The Company's accounts are prepared on an accrual basis. Except for investment properties
and certain financial instruments measured at fair value, the measurement of items in the
financial statements is made at the historical cost. In case of asset impairment, the
corresponding provision for impairment should be made according to relevant provisions.
3 Principal accounting policies and accounting estimates
3.1 Statement 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 relevant information of
the Company during the reporting period, such as financial position, operation results and cash
flows.
3.2 Accounting period
The accounting year is from January 1 to December 31 in calendar year.
3.3 Operating cycle
The operating cycle refers to the cycle from the Company's purchase of assets for processing
to the realization of cash or cash equivalents. The Company takes 12 months as an operating
cycle, and as the classification standard for the liquidity of assets and liabilities.
3.4 Functional currency
RMB is adopted as the functional currency.
Notes to the Financial Statements Page 2
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.5 Accounting treatment methods for business combinations under common control and not
under common control
3.5.1 If the terms, conditions and economic impact of the transactions during the
business combination realized by stages meet one or more of the following
circumstances, the multiple transactions will be subject to accounting processing
as a package deal:
(1) The transactions are concluded at the same time or under the consideration of
mutual effect;
(2) These transactions as a whole can reach a complete business result;
(3) The occurrence of a transaction depends on that of other transaction or more;
and/or
(4) A single transaction is uneconomical but it is economical when considered
together with other transactions.
3.5.2 Business combination under common control
For assets and liabilities obtained through business combination by the Company, they
are measured at the book value of the assets and liabilities (including the goodwill
formed by the acquisition of the combined party by the ultimate controller) in the
consolidated financial statements of the ultimate controller on the combination date.
The stock premium in capital reserves is adjusted according to the difference between
the book value of net assets acquired through combination and the book value of
consideration paid for the combination (or total par value of shares issued). If the stock
premium in capital reserves is insufficient to cover the difference, the remaining
amount will be charged against retained earnings.
Where there is contingent consideration and it is required to recognize estimated
liabilities or assets, the capital reserve (capital premium or stock premium) is adjusted
according to the difference between the estimated liabilities or assets and subsequent
consideration, if any; if the capital reserve is insufficient, the retained earnings shall be
adjusted.
The business combination not under common control finally realized through multiple
transactions belongs to a package of transactions, the Company should account for
various transactions as a transaction with control; if not belong to a package of
transactions, the capital reserve will be adjusted at the difference between the initial
investment cost of the long-term equity investment on the combination date and the
sum of the book value of the long-term equity investment before combination and the
book value of the consideration newly paid by shares acquired on the date when the
control is obtained; and if the capital reserve is insufficient for write-downs, the
retained earnings will be adjusted. For equity investments held before the combination
date, other comprehensive income measured at equity method or confirmed by financial
instruments and measured at accounting guidelines will not be accounted for until on
disposal of such investment, and its accounting treatment will be made by using the
same basis for the investee to directly dispose the relevant assets or liabilities; changes
in other owners' equity other than net profit or loss, other comprehensive income and
profit distribution in net asset of the investee recognized by using the equity method
will not be accounted for until on disposal of such investment, and then be carried
forward to the current profit or loss.
Notes to the Financial Statements Page 3
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.5.3 Business combination not under common control
The acquisition date refers to the date on which the Company actually obtains control
of the acquiree, that is, the date on which the acquiree's control over net assets or
production and operation decisions is transferred to the Company. The Company
generally believes that the control has been transferred of all the following conditions
are met simultaneously:
① The Company's combination contract or agreement has been approved by the
internal authorities of the Company.
② Where the business combinations matters shall be approved by the relevant
national competent departments, the approval has been obtained.
③ The necessary property rights transfer formalities have been handled.
④ The Company has paid most of the combination price and has the ability to
repay the remaining payment in a planned way.
⑤ The Company actually has taken control of the acquiree's financial and
operating policies and enjoys the corresponding benefits and bears the
corresponding risks.
The Company shall, on the acquisition date, measure the assets surrendered and
liabilities incurred or assumed as a consideration of business combination at their fair
values. The difference between the fair value and their book value will be included into
the current profit or loss.
The Company recognizes the difference of the combination cost in excess of the fair
value of the net identifiable assets acquired from the acquiree as goodwill, and
recognizes the difference of the combination cost in short of the fair value of the net
identifiable assets acquired from the acquiree in the current profit or loss after review.
If the business combination not under common control realized through multiple
transactions and by stages belongs to a package of transactions, the Group should
account for various transactions as a transaction with control; if not belong to a package
of transactions, and equity investment held before the date of combination is accounted
for at equity method, the sum of book value of investment in equity of the acquiree held
by the acquirer before the acquisition date and the added investment costs on the
acquisition date is recognized as the initial investment cost of such investment; for
other comprehensive income recognized from accounting of the equity investments
held before acquisition date and under the equity method, accounting treatment should
be made by using the same basis for the investee to directly dispose the relevant assets
or liabilities on disposal of such investment. If equity investment held before the
combination date is recognized by financial instruments and measured according to
measurement standards, the sum of book value of investment in equity on the
combination date and the added investment costs is recognized as the initial investment
cost on the combination date. The difference between the fair value and the book value
of previously held equity and the cumulative change in fair value originally recognized
in other comprehensive income will be fully transferred to the current investment
income on the date of combination.
Notes to the Financial Statements Page 4
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.5.4 Related expenses for business combination
The intermediary expenses including expenses on audit, legal service, and evaluation and
consultation for business combination and other directly relevant expenses are included in the
current profit or loss when they occur; the transaction expenses on issuing equity securities for
business combination may be directly included in equity transactions and be offset from equity.
3.6 Preparation method of consolidated financial statements
3.6.1 Consolidation scope
The scope of consolidation for the Company’s consolidated financial statements is
determined on the basis of control, and all its subsidiaries (including the independent
subject that is under control of the Company) are included in the consolidated financial
statements.
3.6.2 Procedures for consolidation
The Company prepares the consolidated financial statements based on financial
statements of itself and its subsidiaries and according to other relevant information.
Upon the preparation of consolidated financial statements, the Company shall take the
enterprise group as a whole accounting entity, and reflects the overall financial position,
operating results and cash flows of the enterprise group in accordance with relevant
requirements for recognition, measurement and presentation as stated in the Accounting
Standards for Business Enterprises as well as uniform accounting policies.
All the subsidiaries within the scope of consolidation for the consolidated financial
statements adopt the same accounting policies and accounting periods as those of the
Company. If the accounting policies or accounting periods of a subsidiary are different
from those of the Company, the consolidated financial statements of the subsidiary,
upon preparation, will be adjusted according to the accounting policies and accounting
periods of the Company.
When preparing the consolidated financial statements, the impacts of the Company and
its subsidiaries or the internal transactions between the subsidiaries on the consolidated
balance sheet, consolidated income statement, consolidated statement of cash flows and
consolidated statement of changes in shareholders' equity shall be offset. If assessments
for the same transaction from the enterprise group's consolidated financial statements
and the Company or its subsidiaries as the accounting entity are not the same, such
transaction will be adjusted from the enterprise group.
The share of owners' equity, current net profit or loss and current comprehensive
income of subsidiaries attributable to minority owners are respectively and separately
presented under the owner's equity in the consolidated balance sheet, the net profit in
the consolidated income statement, and the total comprehensive income in the
consolidated income statement. If the current loss shared by a minority shareholder of a
subsidiary exceeds the balances arising from the shares enjoyed by the minority
shareholder in the owners' equity of the subsidiary at the beginning of the period,
minority equity will be written down accordingly.
For the subsidiaries acquired through business combination under common control,
adjustment to their financial statements is made based on the book values of its assets
and liabilities (including goodwill formed in the acquisition of these subsidiaries by the
ultimate controller) as presented in the financial statements of the ultimate controller.
For the subsidiaries acquired through business combination not under common control,
adjustments to their financial statements are made based on the fair values of net
identifiable assets on the acquisition date
(1) Increase of subsidiaries or business
Notes to the Financial Statements Page 5
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
During the reporting period, where the Company acquired subsidiaries or
business from the business combination under common control, the beginning
balance in the consolidated balance sheet is adjusted; the revenue, expenses and
profits of the newly acquired subsidiaries or business from the beginning of the
period for business combination to the end of the reporting period are included
in the consolidated income statement; the cash flows of the same for the
aforesaid period are included in the consolidated statement of cash flows.
Relevant items in the comparative financial statements of the subsidiaries are
adjusted accordingly, as if the reporting entity after the business combination
exists as of the time when the ultimate controller has the control.
Where control can be exercised on the investee under common control for
additional investment or other reasons, adjustment is made as if all parties
involved in the combination exist at the beginning of the control by the ultimate
controller. Equity investments held before the control over the combined party is
obtained, the related profits or losses, other comprehensive income as well as
other changes in net assets recognized from the later between the date when the
original equity is obtained and the date when the acquirer and the acquiree are
under common control to the combination date will respectively write down the
beginning retained earnings or the current profit or loss during the period for
comparing financial statements.
During the reporting period, if the Company acquired subsidiaries or business
from the business combination not under common control, the beginning
balance in the consolidated balance sheet will not be adjusted. The revenue,
expenses and profits of the newly acquired subsidiaries or business from the
acquisition date to the end of the reporting period will be included in the
consolidated income statement; the cash flows of the same for the aforesaid
period will be included in the consolidated statement of cash flows.
Where the Company can control the investee not under common control for
additional investments, it shall re-measure equity of the acquiree held before the
acquisition date at the fair value of such equity on the acquisition date and
include the difference between the fair value and book value in the current
investment income. Where equity of the acquiree held before the acquisition
date involves in other comprehensive income accounted for under equity
method and other changes in owners' equity other than net profit or loss, other
comprehensive income and profit distribution, the relevant other comprehensive
income and other changes in owners' equity shall be transferred to the
investment income in the year which the acquisition date falls in, except for
other comprehensive income from changes arising from re-measurement of net
liabilities or net assets of defined benefit plan by the investee.
(2) Disposal of subsidiaries or business
1) General treatment methods
During the reporting period, where the Company disposes a subsidiary or
business, the revenues, expenses and profits of the subsidiary or business
from the beginning period to the disposal date shall be included in the
consolidated cash flow statement; cash flows of the subsidiary or the
business from the beginning period to the disposal date shall be included
in the consolidated cash flow statement.
Notes to the Financial Statements Page 6
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
When the Company losses the control over the investee due to disposal
of partial equity investment or other reasons, the remaining equity
investment after the disposal should be remeasured by the Company at
the fair value thereof on the date of losing the control. The difference
between the sum of the equity disposal consideration and the fair value
of the remaining equity and the sum of the share calculated at the original
shareholding ratio in net assets enjoyed in the original subsidiary and
continuously calculated from the acquisition date or combination date
and the goodwill will be included in the investment income for the period
where the control is lost. Other comprehensive incomes associated with
the equity investments of the original subsidiary, or the changes in
owners' equity other than net profit or loss, other comprehensive income
and profit distribution, shall be transferred into investment income of the
period when control is lost, except for other comprehensive income from
the change in net liability or net asset due to the investor's re-
measurement of defined benefit plan.
2) Disposal of subsidiaries by stages
If the control is lost due to disposal of the equity investments in
subsidiaries through multiple transactions by stages, and the terms,
conditions and economic impact of the transactions related to the
disposal of equity investments in subsidiaries meet one or more of the
following circumstances, it usually indicates that multiple transactions
will be subject to accounting processing as a package deal:
A. The transactions are concluded at the same time or under the
consideration of mutual effect;
B. These transactions as a whole can reach a complete business
result;
C. The occurrence of a transaction depends on that of other
transaction or more; and/or
D. A single transaction is uneconomical but it is economical when
considered together with other transactions.
Where various transactions of disposal of equity investments in
subsidiaries until loss of the control belong to a package deal, accounting
treatment shall be made by the Company on the transactions as a
transaction to dispose subsidiaries and lose the control; however, the
difference between each disposal cost and net asset share in the
subsidiaries corresponding to each disposal of investments before loss of
the control should be recognized as other comprehensive income in the
consolidated financial statements and should be transferred into the
current profit or loss at the loss of the control.
If the disposal of equity investment in subsidiaries and other transactions
until the control loses are not package transactions, before the control
loses, related policies governing the partial disposal of equity
investments in subsidiaries without losing control will apply; when the
control loses, general accounting method for the disposal of subsidiaries
will govern.
Notes to the Financial Statements Page 7
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
(3) Purchase of minority equity of subsidiaries
The share premium in the capital reserves under the consolidated balance sheet
will be adjusted at the difference between the long-term equity investment
acquired by the Company for the purchase of minority interest and the share of
net assets calculated constantly from the acquisition date (or combination date)
according to the newly increased shareholding ratio. If the share premium is
insufficient to offset, retained earnings will be adjusted.
(4) Partial disposal of equity investments in subsidiaries without losing control
The equity premium of capital reserves in the consolidated balance sheet will be
adjusted according to the difference between the disposal price obtained for
partial disposal of long-term equity investments in subsidiaries in the case of not
lose control and the share of net assets of subsidiaries calculated from the
acquisition date or the combination date corresponding to the disposal of long-
term equity investments; if the equity premium of capital reserves is insufficient,
the retained earnings will be adjusted.
3.7 Classification of joint venture arrangements and accounting treatment methods of joint
operation
3.7.1 Classification of joint venture arrangements
According to the structure, legal form, terms of joint arrangement, other relevant facts
and circumstances, the Company divides the joint venture arrangements into joint
operation and joint ventures.
Joint venture arrangements that have not been reached through separate entities are
classified as joint operations; joint venture arrangements that have been reached
through separate entities are generally classified as joint ventures; however, there is
conclusive evidence that the joint venture arrangements that meet any of the following
conditions and comply with the relevant laws and regulations shall be classified as joint
operations:
(1) the legal form of the joint venture arrangement indicates that the joint venturer
has rights and obligations for the relevant assets and liabilities respectively in
the arrangement;
(2) the contract terms of the joint venture arrangement indicates that the joint
venturer has rights and obligations for the relevant assets and liabilities
respectively in the arrangement;
(3) other relevant facts and circumstances indicate that the joint venturer has rights
and obligations for the relevant assets and liabilities respectively in the
arrangement, and if the joint venturer enjoys almost all the outputs related to the
joint venture arrangement, the settlement of the liabilities in the arrangement
continues to depend on the support from the joint venturer.
3.7.2 Accounting treatment methods of joint operation
The Company recognizes the following items related to its share of benefits in the joint
operation and conduct accounting treatment in accordance with relevant accounting
standards for business enterprises:
(1) Assets it solely holds and its share of jointly-held assets based on its percentage;
(2) Liabilities it solely assumes and its share of jointly-assumed liabilities based on
its percentage;
(3) Revenues from sale of output enjoyed by it from the joint operation;
Notes to the Financial Statements Page 8
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
(4) Revenues from sale of output from the joint operation based on its percentage;
and
(5) Separate costs and costs for the joint operation based on its percentage.
Where the Company, invests assets in or sells assets to the joint operation (excluding
the assets constituting business), before such assets are sold to a third party via the joint
operation, the Company shall only recognize the part in the profits and losses arising
from such transaction attributable to other party to the joint operation. If the assets
invested or sold meet the asset impairment losses stipulated in the Accounting
Standards for Business Enterprises No. 8 – Impairment of Assets, the Company shall
confirm the losses in full.
Where the Company, purchases assets from the joint operation (excluding the assets
constituting business), before such assets are sold to a third party, the Company shall
only recognize the part in the profits and losses arising from such transaction
attributable to other party to the joint operation. If the assets purchased meet the asset
impairment losses stipulated in the Accounting Standards for Business Enterprises No.
8 – Impairment of Assets, the Company shall recognize the losses according the shares
it shall assumed.
Where the Company does not enjoy joint control to the joint operation, if it enjoys the
related assets of the joint operation and assumes the related liabilities, accounting
treatment shall be subject to the above principles; otherwise, accounting treatment shall
be carried out according to the relevant accounting standards for business enterprises.
3.8 Recognition criteria of cash and cash equivalents
For the purpose of preparing the statement of cash flows, the term "cash" refers to the cash on
hand and the unrestricted deposit of the Company. The term "cash equivalents" refers to short-
term (maturing within three months from the acquisition date) and highly liquid investments
that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of change in value.
3.9 Foreign currency transactions and translation of foreign currency statements
3.9.1 Foreign currency transactions
At the initial recognition, foreign currency transactions are translated into RMB for
recording purpose using the current average exchange rate at the spot rate on the
transaction date.
The foreign currency monetary items on the balance sheet date are translated at the spot
exchange rate on the balance sheet date. The exchange differences arising therefrom,
except for the exchange difference from foreign currency special loans related to the
acquisition and construction of assets that meet the capitalization conditions treated in
accordance with the capitalization principle of borrowing expenses, are included in the
current profit or loss. The foreign currency non-currency items calculated on historical
cost basis are still translated at spot rate on the date of transaction, not changing the
amount of its recording currency.
Foreign currency non-monetary items measured at fair value shall be translated into
RMB at the spot exchange rates on the day when the fair value is determined. The
difference between the functional currency and previous functional currency after
translation is taken as fair value changes (including fluctuation in exchange rate) and
included in the current profit or loss or recognized as other comprehensive income.
Notes to the Financial Statements Page 9
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.10 Financial instruments
When the Company becomes a party to a financial instrument contract, a financial asset or
financial liability should be recognized.
Effective interest method refers to the method of calculating the amortized cost of a financial
asset or financial liability and of apportioning interest income and interest expenses in relevant
accounting periods.
Effective interest rate refers to the interest rate used to discount the estimated future cash flows
of financial asset or financial liability during the expected duration into the book balance of
such financial asset or the amortized cost of such financial liability. When determining the
effective interest rate, the Company will estimate the expected cash flows pursuant to all
contractual terms of financial assets or financial liabilities (including prepayment, contract
renewal, call option and other similar options) and without regard to expected credit losses.
The amortized cost of a financial asset or financial liability is the amount initially recognized
for that financial asset or financial liability less the principal repaid, plus or minus the
cumulative amortization of the difference between the amount initially recognized and the
amount at maturity using the effective interest method, less the cumulative loss allowance (for
financial assets only).
3.10.1 Classification, recognition and measurement of financial assets
The Company, according to the business model of managing financial assets and the
contractual cash flow characteristics of financial assets, classifies financial assets into:
(1) Financial assets measured at amortized cost.
(2) Financial assets measured at fair value through other comprehensive income.
(3) Financial assets measured at fair value through the current profit or loss.
Financial assets are measured at their fair values at the initial recognized. However, if
the accounts receivable or notes receivable arising from the sales of goods or rendering
of services fail to cover the significant financing component or the financing
component over one year will not be taken into account therefor, the initial
measurement will be made at the transaction price.
Transaction expenses related to financial assets measured at fair value through current
profit or loss are directly included in the current profit or loss, and those related to
financial assets in other kinds are included in the initially recognized amounts of such
financial assets.
Subsequent measurement of financial assets depends on their classification: When and
only if the Company changes its business model for managing financial assets, all
relevant financial assets affected can be reclassified.
(1) Financial assets classified to be measured at amortized cost
Where the contractual terms of a financial asset provide that the only cash flows
arising on a specific date are payments of principal and interest based on the
principal amount outstanding, and the business model for managing the financial
asset is to collect the contractual cash flows, the Company classifies the
financial asset as a financial asset measured at amortized cost. The Company's
financial assets classified to be measured at amortized cost include monetary
funds, notes receivable and accounts receivable, other receivables, long-term
receivables and creditor's right investment.
Notes to the Financial Statements Page 10
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
The Company recognizes the interest income of such financial assets at effective
interest method and subsequently measures them at the amortized cost. Gains
and losses arising from impairment, derecognition or modification should be
included in the current profit or loss. Except for the following cases, the
Company calculates interest income based on the book balance of financial asset
multiplied by the effective interest rate:
1) For purchased or original financial assets that have suffered credit
impairment, from the initial recognition, the interest income is
determined by the Company based on the amortized cost of the financial
asset and the effective interest rate adjusted by credit.
2) For purchased or original financial assets that have not suffered credit
impairment but have suffered credit impairment in the subsequent period,
the interest income is determined by the Company based on the
amortized cost of the financial asset and the effective interest rate. If the
financial instrument has no credit impairment due to the improvement of
its credit risk in the subsequent period, the Company will determine the
interest income based on the book balance of financial asset multiplied
by the effective interest rate.
(2) Financial assets classified to be measured at fair value through other
comprehensive income
Where the contractual terms of the financial assets stipulate that the cash flow
generated on a specific date is only the payment for the principal and the interest
based on the outstanding principal amount, and the business model for
managing the financial asset aims at collecting contractual cash flows and
selling such financial asset, the Company classifies the financial asset as the
financial asset measured at fair value through other comprehensive income.
Interest income from such financial assets will be recognized by using the
effective interest method. Except that the interest income, impairment losses and
exchange differences are recognized as the current profit or loss, changes in
other fair values are included in other comprehensive income. When a financial
asset is derecognized, the accumulated gains or losses previously included in
other comprehensive income should be transferred from other comprehensive
income and included in the current profit or loss.
Notes receivable and accounts receivable measured at fair value through other
comprehensive income are presented as the receivables financing, while other
financial assets are presented as other creditor's right investments; in which,
other creditor's right investments maturing within one year as of the balance
sheet date are presented as the non-current assets maturing within one year, and
other creditor's right investments originally maturing within one year are
presented as other current assets.
(3) Financial assets designated to be measured at fair value through other
comprehensive income
At the initial recognition of the financial assets designated to be measured at fair
value through other comprehensive income, the Company may irrevocably
designate the equity instrument investments not held for trading as financial
assets measured at fair value through other comprehensive income on a basis of
individual financial asset.
Notes to the Financial Statements Page 11
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
The changes in the fair value of such financial assets are included in other
comprehensive income, and no provision for impairment is required. At the
derecognition of such financial assets, the accumulated gains or losses
previously included in other comprehensive income are transferred from other
comprehensive income to retained earnings. During the period when the
Company holds the investment in equity instrument, the Company's right to
receive dividends has been established. Revenues from dividends are recognized
and included in the current profit or loss when economic benefits related to the
dividends are likely to flow into the Company and the amount of the same can
be measured reliably. The Company presents such financial assets in other
investment in equity instruments.
If the investment in equity instrument meets one of the following conditions, it
belongs to the financial assets measured at fair value through the current profit
or loss: the purpose of the acquisition of the financial assets is mainly for selling
in the near future; at the initial recognition, it is a part of the identifiable
financial asset instrument portfolio under the centralized management, and there
is the objective evidence that a short-term profit model actually existed in the
near future; it belongs to derivative instruments (except for those meeting the
definition of a financial guarantee contract and designated as effective hedging
instruments).
(4) Financial assets classified to be measured at fair value through the current profit
or loss
The financial assets, not qualified for being classified to be measured at
amortized cost or fair value through other comprehensive income, and not
designated to be measured at fair value through other comprehensive income,
are classified as financial assets measured at fair value through the current profit
or loss.
Such financial assets are subsequently measured by the Company at fair value.
Gains or losses from changes in fair value as well as dividends and interest
income related to such financial liabilities are included in the current profit or
loss.
The Company presents such financial assets in the financial assets held for
trading and other non-current financial assets according to their liquidity.
(5) Financial assets designated to be measured at fair value through the current
profit or loss
At the initial recognition, in order to eliminate or significantly reduce
accounting mismatches, the Company may irrevocably designate such financial
assets as financial assets measured at fair value through the current profit or loss
on a basis of individual financial asset.
Where a mixed contract includes one embedded derivative or more, and the
main contract does not belong to any financial asset mentioned above, the
Company may designate such mixed contract in whole as the financial
instrument measured at fair value through the current profit or loss. Except that:
1) The embedded derivative will not materially change the cash flow of the
mixed contract.
Notes to the Financial Statements Page 12
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
2) At the initial confirmation on whether the similar mixed contract need to
be split, it takes little analysis to make clear that the embedded derivative
contained in such mixed contract should not be split. If the right to
repayment in advance of embedded loans allows the holder to make the
repayment of loans in advance at the amount close to the amortized cost,
such right to repayment in advance should not be split.
Such financial assets are subsequently measured by the Company at fair value.
Gains or losses from changes in fair value as well as dividends and interest
income related to such financial liabilities are included in the current profit or
loss.
The Company presents such financial assets in the financial assets held for
trading and other non-current financial assets according to their liquidity.
3.10.2 Classification, recognition and measurement of financial liabilities
The Company classifies the financial instruments or their components as financial
liabilities or equity instruments at the time of the initial recognition, in accordance with
contractual terms of financial instruments issued and economic substance reflected and
not only legal form, in combination with the definition of financial liabilities and equity
instruments. Upon initial recognition, financial liabilities are classified into: financial
liabilities measured at fair value through current profit or loss, other financial liabilities
and derivative instruments designated as effective hedging instruments.
Financial liabilities are measured at their fair values at the initial recognition. For
financial liabilities measured at fair value through the current profit or loss, the relevant
transaction expenses are directly included in the current profit or loss; for other types of
financial liabilities, the relevant transaction expenses are included in the initial
recognition amount.
Subsequent measurement of financial liabilities depends on the classification thereof:
(1) Financial liabilities measured at fair value through the current profit or loss
Such financial liabilities include the financial liabilities held for trading
(including the derivative instruments belong to financial liabilities) and financial
liabilities designated to be measured at fair value through the current profit or
loss at initial recognition.
Financial liabilities meeting one of the following conditions belong to the
financial liabilities held for trading: the purpose of bearing relevant financial
liabilities is mainly for sales or repurchase the near future; such financial
liabilities belong to the portfolio of identifiable financial instruments under
centralized management, and there is the objective evidence that any enterprise
has adopted the short-term profiting manner recently; such financial liabilities
belong to other derivative instruments than those designated to be the effective
hedging instruments and those complying with financial guarantee contracts.
Financial liabilities held for trading (including derivative instruments belonging
to financial liabilities) are subsequently measured at fair value. Except for hedge
accounting, all changes in fair value are included in the current profit or loss.
At the initial recognition, in order to provide more relevant accounting
information, the Company irrevocably designates the financial liabilities
meeting one of the following conditions as financial liabilities measured at fair
value through the current profit or loss:
1) Such designation can eliminate or significantly reduce the accounting
mismatch.
Notes to the Financial Statements Page 13
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
2) According to the enterprise risk management or investment strategies
specified in formal written documents, the management and performance
evaluation of financial liability portfolios or portfolios of financial assets
and financial liabilities is carried out based on fair value, and the report
to key officer in the enterprise is made based on such management and
performance evaluation.
The Company makes subsequent measurement of such financial liabilities at fair
value. Except that the changes in fair value caused by changes in the Company's
own credit risk are included in other comprehensive income, other changes in
fair value are included in the current profit or loss. Unless the changes in fair
value caused by changes in the Company's own credit risk are included in other
comprehensive income or will amplify the accounting mismatch in profit or loss,
the Company includes all changes in fair value (including the affected amount
of changes in its own credit risk) in the current profit or loss.
(2) Other financial liabilities
The financial liabilities other than the following ones, are classified by the
Company as the financial liabilities measured at amortized cost, and are
subsequently measured at the at amortized cost by using the effective interest
method. Gains or losses on derecognition or amortization are included in the
current profit or loss.
1) Financial liabilities measured at fair value through the current profit or
loss.
2) Financial liabilities arising from such situation that the transfer of
financial assets fails to meet the conditions for derecognition or the
financial assets are continuously transferred.
3) Financial guarantee contracts that do not fall into the first two
circumstances of this article, and loan commitments that do not fall into 1)
circumstance of this article at the rate lower than the market interest rate.
Financial guarantee contracts refer to contracts that require the issuer to pay a
specific amount to the contract holder who has suffered a loss when a specific
debtor fails to repay the debt in accordance with clauses for the original or
modified debt instrument upon maturity. As for the financial guarantee contracts
of financial liabilities that are not designated to be measured by fair value
through the current profit or loss, upon the initial recognition, they are measured
at the amount of provision for losses or the balance of initially recognized
amount deducting accumulated amortization amount during the guarantee period.
3.10.3 Derecognition of financial assets and financial liabilities
(1) Financial assets are derecognized when they meet one of the following
conditions, that is, they will be written off from their accounts or the balance
sheet:
1) The contractual rights for collecting the cash flows of such financial
assets are terminated.
2) Such financial assets have been transferred, meeting the requirement for
derecognition of financial assets.
(2) Derecognition criteria of financial liabilities
Notes to the Financial Statements Page 14
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
When the present obligation of any financial liability is relieved in all or in part, the
financial liability should be derecognized in all or in part.
Where the Company enters into an agreement with a creditor so as to substitute the
original financial liability by undertaking the new financial liability, and the new
financial liability and the original financial liability are substantially different in terms
of the contract clauses or the Company has substantially changed the contract clauses
for the original financial liability (or any part thereof), the original financial liability
should be derecognized while the new financial liability should be recognized.
Meanwhile, the difference between the book value and the considerations paid
(including non-cash assets surrendered or new financial liabilities assumed) should be
included in the current profit or loss.
Where the Company redeems a part of its financial liabilities, the Company should
allocate the entire book value of the financial liabilities based on the proportions of fair
values of the financial liabilities continuously recognized and the financial liabilities
derecognized on the redemption date in the entire fair value. The difference between
the book value allocated for the financial liabilities derecognized and the consideration
paid (including non-cash assets surrendered and the new liabilities assumed) should be
included in the current profit or loss.
3.10.4 Recognition basis and measurement method of the transfer of financial assets
At the transfer of financial assets, the Company should evaluate the degree in reserving
risks and rewards related to the ownership of the financial assets, and make relevant
treatment respectively based on the following circumstances:
(1) If nearly all of the risks and rewards related to the ownership of the financial
assets have been transferred, the Company will derecognize such financial assets,
and recognize the right and obligation generates or reserved in the course of
transfer as an asset or a liability.
(2) If nearly all of the risks and rewards related to the ownership of the financial
assets have been reserved, the Company will continuously recognize the
financial assets.
(3) If the Company neither transfers nor reserves nearly all of the risks and rewards
related to the ownership of the financial assets (i.e., other circumstances than
item (1) or (2) herein), the Company will make relevant treatments in the
following circumstances based on whether it has reserved the control over
financial assets:
1) If the Company fails to reserve the control over the financial assets, it
will derecognize such financial assets, and separately recognize the right
and obligation generating or reserved in the course of transfer as an asset
or a liability.
2) If the Company reserves the control over the financial asset, it will
continue to recognize relevant financial assets based on the degree of
continuous involvement in transferred financial assets; and recognize
relevant liabilities accordingly. The degree of continuous involvement in
transferred financial assets refers to the degree in undertaking the risk in
fair value change of or reward for the transferred financial assets by the
Company.
Notes to the Financial Statements Page 15
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
In determining whether the transfer of a financial asset meets the above derecognition
conditions of financial assets, the principle of substance over form will be adopted. The
Company divides the transfer of financial assets into overall transfer and partial transfer.
(1) Where the entire transfer of financial assets meets the derecognition conditions,
the difference of the following two amounts is included in the current profit or
loss:
1) The book value of the transferred financial assets on the date of
derecognition.
2) The sum of the consideration received from the transfer of financial
assets and the amount of the derecognized part corresponding to the
accumulated amount of the changes in fair value originally and directly
recorded into other comprehensive income (financial assets involving
transfer refer to the financial assets measured at fair value through other
comprehensive income).
(2) If the partial transfer of financial assets overall satisfies the criteria for
derecognition, the entire book value of the transferred financial assets should be
split into the derecognized part and continuously-recognized part (in such case,
the reserved service assets should be deemed as a part of the continuously-
recognized financial assets) according to their respective fair value on the
transfer date and the difference between the following two amounts should be
included in the current profit or loss:
1) The book value of the derecognized financial assets on the date of
derecognition.
2) The sum of the consideration received for the derecognized part and the
amount of the derecognized part corresponding to the accumulated
amount of the changes in fair value originally included in other
comprehensive income (financial assets involving transfer refer to the
financial assets measured at fair value through other comprehensive
income).
Where the transfer of financial assets does not meet the derecognition criteria, the
financial assets shall continue to be recognized, and the consideration received will be
recognized as a financial liability.
3.10.5 Determination method for the fair value of financial assets and financial
liabilities
The fair value of a financial asset or financial liability, for which there is an active
market, is determined at the price quoted in the active market, unless the financial asset
has a restricted period for assets. For the financial assets with a restricted period for
sales of assets, the fair value is determined at prices quoted in the active market
deducting the amount of compensation for risks borne by the market participant, as they
are unable to sell such financial assets in the open market within the specified period.
The price quoted in the active market includes the quoted price for relevant assets or
liabilities that are easy to regularly obtain from exchanges, dealers, brokers, industry
groups, pricing agencies or regulators, and it can represent the market transaction that
actually and frequently occur on the basis of fair transaction.
For financial assets initially obtained or derived or financial liabilities assumed, their
fair values are determined based on the market transaction price.
Notes to the Financial Statements Page 16
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
The fair value of a financial asset or financial liability, for which there is no active
market, is determined by using valuation techniques. At the time of valuation, the
Company adopts the techniques that are applicable in the current situation and
supported by enough available data and other information, selects the input values that
are consistent with the features of assets or liabilities as considered by market
participants in relevant asset or liability transactions, and gives priority to use relevant
observable input values as soon as possible. The unobservable input values may be
used only when the observable input values are unable or unpractical to be obtained.
3.10.6 Impairment of financial instruments
The Company, based on the expected credit loss, made the impairment accounting
treatment for financial assets classified to be measured as at amortized cost, financial
assets classified to be measured at fair value through other comprehensive income,
lease receivables, contract assets and financial guarantee contracts, and recognized the
loss provisions thereof.
The expected credit loss refers to the weighted average of the credit losses of financial
instruments that are weighted by the risk of default. Credit loss refers to the difference
between all contractual cash flows receivable from the contract and discounted at the
original actual interest rate and all cash flows expected to be received by the Company,
that is, the present value of all cash shortages. The financial assets purchased by the
Company or originated with credit impairment should are discounted at the actual
interest rate upon credit adjustment of financial assets.
For the purchased or original financial assets with credit impairment, the provision for
losses is made on the balance sheet date based on the accumulated changes in the
expected credit loss over the whole duration after the initial recognition. On each
balance sheet date, the amount of change in the expected credit loss over the whole
duration is included in the current profit or loss as impairment gain or loss. Even
through the expected credit loss over the whole duration determined on such balance
sheet date is less than the expected credit loss reflected via the estimate of cash flows at
the initial recognition, the favorable change in expected credit loss is recognized as
impairment gain.
For other financial assets than the financial assets adopting the simplified measurement
method and the purchased or original financial assets with credit impairment, the
Company makes assessment on each balance sheet date on whether the credit risk of
relevant financial instrument has increased significantly after the initial recognition,
makes the provision for loss thereof, and recognizes the expected credit loss and
changes thereof:
(1) If the credit risk of a financial instrument has not increased significantly since
the initial recognition, standing at the stage I, the Company will measure the
provision for the expected credit loss of the financial instrument for the reserved
next 12 months, and calculate the interest income based on the book balance of
the financial instrument and the effective interest rate.
(2) If the credit risk of a financial instrument has increased significantly without
credit impairment since the initial recognition, standing at the stage II, the
Company will measure the provision for the expected credit loss of the financial
instrument during the whole duration, and calculate the interest income based on
the book balance of the financial instrument and the effective interest rate.
Notes to the Financial Statements Page 17
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
(3) If the financial instrument has had the credit impairment since the initial
recognition, standing at the stage III, the Company will measure the provision
for the expected credit loss of the financial instrument during the entire duration,
and calculates the interest income based on the amortized cost of the financial
instrument and the effective interest rate.
The amount increased or reversed of provision for credit loss on financial instruments
are included in the current profit or loss as the impairment loss or gain. Except for
financial assets classified to be measured at fair value through other comprehensive
income, the provision for credit loss is used to offset the book balance of financial
assets. For financial assets classified to be measured at fair value through other
comprehensive income, the Company recognizes its provision for credit loss in other
comprehensive income, without reducing the book value of such financial assets
presented in the balance sheet.
In the previous accounting period, the Company has measured the provision for loss at
the amount equivalent to the expected credit loss in the whole duration. However, on
the current balance sheet date, if the financial instrument no longer belongs to the
circumstance under which the credit risk has significantly increased since initial
recognition, the Company will measure the provision for loss of the financial
instrument at an amount equivalent to the expected credit loss in the next 12 months on
the current balance sheet date, and the amount reversed of provision for loss arising
therefrom is included in the current profit or loss as impairment gains.
(1) Credit risk has increased significantly
The Company, by use of reasonable and evidence-based forward-looking
information, determines whether the credit risk of the financial instrument has
increased significantly by comparing the default risk of the financial instrument
on the balance sheet date with that on the initial recognition date. For financial
guarantee contracts, when the Company implements the provisions on
impairment of financial instruments, the date when the Company becomes a
party to the irrevocable commitment is taken as the initial recognition date.
The Company will consider the following factors when assessing whether the
credit risk has increased significantly:
1) Whether the debtor's operating results have changed significantly or are
expected to change significantly;
2) Whether the debtor's regulatory, economic or technical environment has
undergone significant adverse changes;
3) Whether the value of the collateral used as debt pledge or the quality of
guarantee or credit enhancement provided by any third party has had
significant changes that are expected to reduce the economic motivation
of the debtor to repay within the period specified in the contract or affect
the probability of default;
4) Whether the debtor's expected performance and repayment behavior have
changed significantly;
5) Whether the Company's credit management methods for the financial
instrument have changed.
Notes to the Financial Statements Page 18
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
If the Company judges that the financial instrument only has a lower credit risk
on the balance sheet date, it will assume that the credit risk of such financial
instrument has not increased significantly since the initial recognition. If the
default risk of a financial instrument is low, the borrower's ability to perform its
contractual cash flow obligations in a short term will be strong, and even if the
economic situation and operating environment are adversely changed over a
long period, it will not necessarily reduce the borrower's ability to perform its
contractual cash flow, and such financial instrument is considered to have a
lower credit risk.
(2) Financial assets with credit impairment
When one or more events that adversely affect the expected future cash flows of
a financial asset occur, the financial asset becomes a financial asset with credit
impairment. Evidence that credit impairment has occurred in financial assets
includes the following observable information:
1) The issuer or debtor suffers severe financial difficulties;
2) The debtor breaches the relevant contract terms, such as default or delay
in the interest payment or principal repayment;
3) The creditor gives concessions to the debtor in any other circumstances
for economic or contractual considerations relating to the financial
difficulties of the debtor;
4) The debtor is likely to go bankrupt or carry out other financial
restructuring;
5) The financial difficulties of the issuer or the debtor have caused the
active market of the financial asset to disappear; and
6) Purchasing or originating a financial asset at a substantial discount that
reflects the fact that a credit loss has occurred.
Credit impairment of financial assets may be caused by the joint action of
multiple events, and may not be caused by separately identifiable events.
(3) Determination of expected credit loss
In assessing the expected credit loss, based on the expected credit loss on
financial instruments upon the individual and portfolio assessment, the
Company may consider reasonable and evidence-based information about past
events, current conditions and future economic conditions.
The Company classifies financial instruments into different portfolios based on
the common credit risk characteristics. Common credit risk characteristics
adopted by the Company include: types of financial instruments, aging portfolio,
etc. For the individual assessment criteria and portfolio credit risk characteristics
of relevant financial instruments, please refer to the accounting policies for
relevant financial instruments.
The Company determines the expected credit losses of related financial
instruments according to the following methods:
1) For financial assets, the credit loss refers to the present value of the
difference between the contractual cash flow receivable and the expected
cash flow.
Notes to the Financial Statements Page 19
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
2) For leasing receivables, the credit loss is the present value of the
difference between the contract cash flow collected and the cash flow
expected to be collected by the Company.
3) For financial guarantee contracts, the credit loss refers to present value of
the difference between the estimated payment to be paid by the Company
for the credit losses incurred by the contract holder and the Company's
amount receivable from the contract holder, debtor or any other party.
4) For financial assets that have suffered the credit impairment on the
balance sheet date, and the credit impairment does not be caused by the
purchase of or generating from such financial assets, the credit loss refers
to the difference between the book balance of the financial asset and the
present value of the estimated future cash flows discounted at the original
effective interest rate.
Factors reflected via the method adopted by the Company for the measurement
of the expected credit loss of financial instrument include: Unbiased probability
weighted average amount determined by assessing a series of possible results;
the time value of money; unnecessary additional cost which should not be paid
on the balance sheet date or the reasonable and well-founded information on the
previous matters which can be obtained by effort, the current conditions and the
forecast of future economic conditions.
(4) Write-down of financial assets
If the Company no longer reasonably expects that the contractual cash flow of
the financial asset can be fully or partially recovered, the book balance of the
financial asset will be directly written down. Such write-down constitutes the
derecognition of relevant financial assets.
3.10.7 Offset of financial assets and financial liabilities
Financial assets and financial liabilities are respectively presented in the balance sheet
without the mutual offset. However, if they meet the following conditions at the same
time, they will be presented in the balance sheet at the net amount after offset:
(1) The Company has the legal right to offset the recognized amount, and such right
is currently executable; and
(2) The Company intends to make settlement at net amount, or to realize such
financial assets and liquidate such financial liabilities at the same time.
3.11 Notes receivable
See the Note 3.10.6 "Impairment of financial instruments" for the determination method and
accounting treatment method adopted by the Company for the expected credit loss of notes
receivable.
If the Company fails to assess the sufficient evidence for expected credit loss at the reasonable
cost for any individual financial instrument, the Company should, by reference to the historical
experience in credit loss and in light of the current conditions and the judgment on the future
economic conditions, divide notes receivable into several portfolios based on the credit risk
characteristics, to calculate the expected credit loss on the basis of portfolio. Portfolios are
determined based on:
Notes to the Financial Statements Page 20
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Basis for portfolio
Portfolio name Provision method
determination
The provision for bad debts is made with
reference to historical credit loss experience,
Portfolio of risk-free in combination with current conditions and
bank acceptance bill expectations of future economic conditions.
Based on the historical experience in credit
loss and in light of the current situation and
the prediction of future economic position,
preparing the comparison table of expected
credit loss ratios over aging and the whole
Commercial By acceptance unit duration of these notes receivable to calculate
acceptance bills rating the expected credit loss.
3.12 Accounts receivable
For accounts receivable, whether or not they contain significant financing components, the
Company always measures the loss reserves according to the amount equivalent to the
expected credit loss in the whole duration. The increase or reversal of loss reserves thus arising
therefrom shall be included in the current profit or loss as the impairment loss or profit.
The Company determines expected credit loss on a single basis for accounts receivable for
which there is objective evidence that credit impairment has occurred and for which there is a
reasonable assessment of expected credit loss individually.
The Company combines the accounts receivable according to similar credit risk characteristics
(aging), and based on all reasonable and supportable information (including forward-looking
information), makes provision for the bad debts of accounts receivable according to the aging
and lifetime expected credit loss comparison table.
See the Note 3.10.6 "Impairment of financial instruments" for the determination method and
accounting treatment method adopted by the Company for the expected credit loss of accounts
receivable.
3.13 Receivables financing
Notes receivable classified as measured at fair value through other comprehensive income
with maturities within one year (inclusive) from the date of initial recognition are presented as
receivables financing; and those with maturities of more than one year from the date of initial
recognition are presented as other creditor's right investments. See the Note (XI) for its
relevant accounting policies.
3.14 Other receivables
See the Note 3.10.6 "Impairment of financial instruments" for the determination method and
accounting treatment method adopted by the Company for the expected credit loss of other
receivables.
If the Company fails to assess the sufficient evidence for expected credit loss at the reasonable
cost for any individual financial instrument, the Company should, by reference to the historical
experience in credit loss and in light of the current conditions and the judgment on the future
economic conditions, divide other receivable into several portfolios based on the credit risk
characteristics, to calculate the expected credit loss on the basis of portfolio. Portfolios are
determined based on:
Notes to the Financial Statements Page 21
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Basis for portfolio
Portfolio name Provision method
determination
Portfolio 1:
Receivables from The provision for bad debts is made with
related parties within reference to historical credit loss experience, in
the scope of combination with current conditions and
consolidation expectations of future economic conditions.
Based on the historical experience in credit loss
and in light of the current situation and the
prediction of future economic position,
preparing the comparison table of expected
Portfolio 2 (Aging Nature of credit loss ratios over aging and the whole
portfolio) payment duration to calculate the expected credit loss.
3.15 Inventories
3.15.1 Classification of inventories
Inventories refer to the finished goods or commodities to be sold, goods in the process
of production, materials and suppliers used in the process of production or rendering of
services, held by the Company during the routine business activities. Inventories
mainly include raw materials, revolving materials, goods in process, stock commodities,
goods dispatched, etc.
3.15.2 Method of measuring inventories
At the acquisition of inventories, the Company makes the initial measurement at cost,
including the purchase cost, processing cost and others. The inventories are measured
by the weighted-average system when dispatched.
3.15.3 Determining basis of net realizable value of inventories and accrual method for
inventory provision
After the comprehensive check of the inventories at the end of the period, the provision
for inventory depreciation is made or adjusted at their costs or net realizable values,
whichever are lower. In the normal production and operation process, for merchandise
inventories for direct sale, including finished goods, stock commodities and materials
for sale, their net realizable values are recognized at the estimated selling prices minus
the estimated selling expenses and the relevant taxes and surcharges; for material
inventories required to be processed, their net realizable values are recognized at the
estimated selling prices of finished goods minus estimated costs until completion,
estimated selling expenses and relevant taxes and surcharges. For inventories held to
under any sales contract or service contract, their net realizable values are calculated
based on the contract price. If the quantity of inventories held by the Company is more
than that ordered in sales contract, the net realizable value of the excess inventories will
be calculated based on general selling price.
The provision for inventory depreciation is made on an individual basis at the end of
the period. For inventories with large quantities and relatively low unit prices, the
provision for inventory depreciation is made on a category basis. For inventories
related to the product portfolios manufactured and sold in the same area, of which the
final usage or purpose is identical or similar thereto, and which is difficult to separate
from other items for measurement purposes, the provision for inventory depreciation is
made on a portfolio basis.
If the previous factor rendering the write-down of the inventory value has been
eliminated, the amounts written down will be recovered, and reversed in the amount of
provision for depreciation of inventories, and the reversed amounts will be included in
the current profit or loss.
3.15.4 Inventory system
Notes to the Financial Statements Page 22
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Inventory system of the inventories is perpetual inventory system.
3.15.5 Amortization method for low-cost consumables and packaging materials
(1) One-off write-off method is adopted for low-cost consumables.
(2) Revolving packaging materials shall be included in costs by several times
according to expected number of uses.
3.16 Contract assets
If the Company enjoys the right to charge consideration as it has transferred goods to relevant
customer, and the right depends on other factors except for the time lapses, such right will be
recognized as the contract asset. The unconditional right (only depending on the time lapses)
to charge consideration from the customer, possessed by the Company, is separately presented
as receivables.
See the Note 3.10.6 "Impairment of financial instruments" for the determination method and
accounting treatment method adopted by the Company for the expected credit loss of contract
assets.
3.17 Held for sale
3.17.1 Recognition criteria for classification as held for sale
The Company recognizes non-current assets or disposal groups that meet both of the
following conditions as components held for sale:
(1) According to the general practice for selling such kind of asset or disposed asset
portfolio in the similar transaction, the asset or portfolio can be immediately
sold in the prevailing circumstance;
(2) The sale of the asset or portfolio is very likely to happen, which means that the
Company has made a resolution for one selling plan and had acquired decided
purchase commitment, and it is estimated that the sale will be completed within
one year.
The determined purchase commitment refers to the legally binding purchase agreement
signed by and between the Company and other parties. The agreement covers
significant clauses in aspects such as transaction price and time and sufficiently severe
breaches and penalty, making slim possibility for the agreement being re-adjusted or
canceled.
3.17.2 Accounting method for held for sale
If the Company does not provide depreciation or amortization for non-current assets or
disposal groups held for sale and the book value is higher than the net amount of fair
value less disposal expenses, the Company shall write down the book value to the net
amount of fair value less disposal expenses, and the written down amount shall be
recognized as an asset impairment loss and included in the current profit or loss, while
providing for the impairment of assets held for sale.
For non-current assets or disposal groups that are classified as held for sale on the
acquisition date are measured at the lower of the initial measurement amount assuming
they are not classified as held for sale or the net fair value less disposal expenses.
Notes to the Financial Statements Page 23
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
The above principles apply to all non-current assets, except for investment real estate
that is subsequently measured using the fair value model, biological assets that are
measured using the net of fair value less disposal costs, assets formed from staff
emoluments, deferred income tax assets, financial assets that are governed by the
relevant accounting standards for financial instruments, and rights arising from
insurance contracts that are governed by the relevant accounting standards for
insurance contracts.
3.18 Other creditor's right investments
See the Note 3.10.6 "Impairment of financial instruments" for the determination method and
accounting treatment method adopted by the Company for the expected credit loss of other
creditor's right investments.
3.19 Long-term receivables
See the Note 3.10.6 "Impairment of financial instruments" for the determination method and
accounting treatment method adopted by the Company for the expected credit loss of long-
term receivables.
3.20 Long-term equity investments
3.20.1 Determination of initial investment cost
(1) For the specific accounting policies for long-term equity investments acquired
through business combination, see the Note 3.5 "Accounting treatment methods
for business combinations under common control and not under common
control".
(2) Long-term equity investments acquired by other means
For long-term equity investments acquired from cash payment, the initial investment
cost is the actually paid purchasing cost. The initial investment cost includes expenses,
taxes and other necessary expenses directly related to obtaining the long-term equity
investment;
For the long-term equity investment acquired from issuing equity securities, the initial
investment cost is the fair value of the issued equity securities; transaction expenses on
the issue or acquisition of the own equity instruments are deducted from the equity if
they are directly attributable to the equity transaction.
On the premise that non-monetary asset trade is of commercial nature and the fair value
of the asset traded in or out can be measured reliably, the initial cost of a long-term
equity investment traded in with non-monetary asset should be determined based on the
fair value of the asset traded out, unless any unambiguous evidence indicates that the
fair value of the asset traded in is more reliable; as to the non-monetary asset trade not
meeting the aforesaid premise, the book value of the asset traded out and relevant taxes
and surcharges payable should be recognized as the initial cost of the long-term equity
investment.
The initial investment cost of the long-term equity investment acquired through the
debt restructuring is determined based on the fair value thereof.
3.20.2 Subsequent measurement and recognition of gains and losses
(1) Cost method
For the long-term equity investments where the Company may have the control
over investees, the cost method is adopted for accounting, the measurement is
made based on the initial investment cost and the cost is adjusted via the
additional investment or the divestment.
Notes to the Financial Statements Page 24
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Except for the actual price paid for acquisition of investment or the cash
dividends or profits contained in the consideration and declared but not yet
distributed, the Company recognizes the current investment income based on the
cash dividends or profits enjoyed by the Company and declared to be distributed
by the investee.
(2) Equity method
The Company accounts for the long-term equity investments in associates and
joint ventures by the equity method; some equity investments in associates
therein indirectly held via the risk investment organization, mutual fund, trust
company or the similar entity including the investment-linked insurance fund
are measured at fair through the profit or loss.
If the initial investment cost of any long-term equity investment is in excess of
the share of fair value of the net identifiable assets in the investee when the
investment is made, the difference will not be adjusted to the initial cost of long-
term equity investment; if the cost of initial investment is in short of the share of
the fair value of the net identifiable assets in the investee when the investment is
made, the difference will be included in the current profit or loss.
After the acquisition of the long-term equity investment, the Company should,
based on its attributable share of the net profit or loss and other comprehensive
income realized by the investee, respectively recognize the investment income
and other comprehensive income, and simultaneously adjust the book value of
the long-term equity investment; and should, in the light of the profits or cash
dividends the investee declares to distribute, calculate the attributable part and
accordingly reduce the book value of the long-term equity investment. As to any
change in owners' equity of the investee other than net profit or loss, other
comprehensive income and profit distribution, the Company should adjust the
book value of the long-term equity investment and include such change in the
owners' equity.
The Company should, based on the fair values of the investee's various
identifiable assets at the time when relevant investment is made, recognize its
share of the investee's net profits or losses, after adjusting the investee's net
profit. The Company calculates its attributable share in the profit or loss from
the unrealized internal transactions between the Company and its associates or
joint ventures based on its attributable percentage and offset such share, and
determines the investment income on that basis.
When the Company confirms that it should share losses incurred in the investee,
treatment should be done in following sequence: first, writing down the book
value of long-term equity investments. Secondly, where the book value thereof
is insufficient to cover the share of losses, investment losses are recognized to
the extent of book value of other long-term equities which form net investment
in the investee in substance and the book value of long-term receivables shall be
reduced. Finally, after all the above treatments, if the Company is still
responsible for any additional liability in accordance with the provisions
stipulated in the investment contracts or agreements, the Company will
recognize an estimated liability based on its expected obligations, and include
the estimated liability in the current investment loss.
Notes to the Financial Statements Page 25
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Where the investee realizes profit during the following period, the Company
make treatment for the profit after deducting such profit with the unrecognized
loss-sharing amount in the order inverse to that mentioned above, i.e. writing off
the recognized book balance of estimated liabilities and reversing the book value
of other long-term equity substantially constituting the net investment in the
investee and the book value of long-term equity investment, and recognizing the
investment income after such reversal.
3.20.3 Conversion of the accounting method for long-term equity investments
(1) Conversion from the measurement at fair value to the accounting by the equity
method
Where the equity investment originally held by the Company, having no control
or common control over or the significant impact on the investee and subject to
the accounting treatment made according to the standards for recognition and
measurement of financial instruments may have the significant influence on or
the common control over the investee on account of additional investment and
other reasons but cannot control the investee, the sum of fair value of originally
held equity investment determined according to the Accounting Standards for
Business Enterprises No. 22 -- Recognition and Measurement of Financial
Instruments and the cost of newly-added investment should be taken as the
initial investment cost of such equity investment calculated by the equity
method.
The difference between the initial investment cost calculated by the equity
method and the share calculated in the new shareholding ratio determined after
the additional investment and enjoyed in the fair value of the investee's net
identifiable assets on the date of additional investment (the latter is higher)
should be used to adjust the book value of the long-term equity investment and
included in the non-operating revenue for the current period.
(2) Conversion from the measurement at fair value or accounting by the equity
method to the accounting by the cost method
Where the equity investment originally held by the Company, having no control
or common control over or the significant impact on the investee and subject to
the accounting treatment made according to the standards for recognition and
measurement of financial instruments, or the long-term equity investment
originally held by the Company in associates and joint ventures may control the
investee not under common control on account of such reasons as additional
investment, at the preparation of the individual financial statements, the initial
investment cost of such investment under the accounting by the cost method
should be recognized at the sum of the book value of originally held equity
investment and the cost of the newly-added investment.
For other comprehensive income that is recognized from the equity investment
held before the acquisition date by using the equity method, the accounting
treatment should be made on the basis the same as that for the direct disposal of
related assets or liabilities by the investee at the disposal of such equity
investment.
Where the equity investments held before the acquisition date are subject to the
accounting treatment made according to the Accounting Standards for Business
Enterprises No. 22 -- Recognition and Measurement of Financial Instruments,
the accumulated changes in fair value originally included in other
comprehensive income should be transferred in the current profit or loss when
the accounting therefor is made by the cost method.
Notes to the Financial Statements Page 26
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
(3) Conversion from accounting by the equity method to the measurement at fair
value
In case the Company loses the common control over or the significant influence
on the investee due to the disposal of part of equity investments or other reasons,
the remaining equity after the disposal should be accounted for according to the
Accounting Standards for Business Enterprises No. 22 -- Recognition and
Measurement of Financial Instruments, and the difference between the fair value
and the book value on the date of the loss of common control or significant
influence should be included in the current profit or loss.
As to other comprehensive income recognized based on measurement of the
original equity investment under the equity method, accounting treatment shall
be made on the same basis as would be required if the investee had directly
disposed of the assets or liabilities related thereto when measurement under the
equity method is terminated.
(4) Conversion from the cost method to the equity method
In case the Company loses the control over the investee due to the disposal of
part of equity investment and other reasons, in the preparation of the individual
financial statements, if the remaining equity has the common control over or
significant influence on the investee, the accounting by the equity method
should be made, and the adjustment should be made as if the remaining equity
had been accounted for by the equity method at acquisition.
(5) Conversion from the cost method to the measurement at fair value
In case the Company loses the control over the investee due to the disposal of
part of equity investments or other reasons, in the preparation of individual
financial statements, the remaining equity after disposal fails to have the
common control over or the significant influence on the investee, the accounting
treatment should be made according to the Accounting Standards for Business
Enterprises No. 22 -- Recognition and Measurement of Financial Instruments,
and the difference between the fair value and the book value thereof on the date
of the loss of control should be included in the current profit or loss.
3.20.4 Disposal of long-term equity investments
For the disposal of long-term equity investments, the difference between the book value
and the actual price thereof should be included in the current profit or loss. Where a
long-term equity investment is accounted for under the equity method, accounting
treatment should be made on the part that is originally included in other comprehensive
income according to corresponding ratio by using the same basis for the investee to
directly dispose of the relevant assets or liabilities when the investments are disposed of.
In case the terms, conditions and economic impact of the transactions related to the
disposal of equity investments in subsidiaries meet one or more of the following
circumstances, multiple transactions should be taken as a package deal for accounting
treatment:
(1) The transactions are concluded at the same time or under the consideration of
mutual effect;
(2) These transactions as a whole can reach a complete business result;
(3) The occurrence of a transaction depends on that of other transaction or more;
and/or
Notes to the Financial Statements Page 27
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
(4) A single transaction is uneconomical but it is economical when considered
together with other transactions.
Where the control over the original subsidiaries is lost due to the disposal of part of
equity investments or other reasons, not belonging to a package deal, relevant
accounting treatment should be made respectively for the individual financial
statements and the consolidated financial statements:
(1) In the individual financial statements, for disposal of equity, the difference
between book value and the actual purchase price should be included in the
current profit and loss. The remaining equity after the disposal that can exercise
common control or exert significant influence over the investee shall be
accounted for in the equity method, and such remaining equity shall be adjusted
as if it had been accounted for in the equity method since the time of acquisition;
the remaining equity after disposal that cannot exercise common control or exert
significant influence over the investee shall be subject to accounting treatment
according to the relevant provisions of the Accounting Standards for Business
Enterprises No. 22 - Recognition and Measurement of Financial Instruments,
and the difference between the fair value on the date when the control is lost and
the book value shall be included into the current profit or loss.
(2) In the consolidated financial statements, for various transactions before loss of
the control over the subsidiaries, the difference between the proceeds from
disposal and the share of net assets of subsidiaries enjoyed the Company
(continuously calculated from the acquisition date or the combination date)
corresponding to the disposal of long-term equity investments, shall be charged
against capital reserves (share premium); when the capital reserves is
insufficient to offset, the retained earnings shall be adjusted. When the Company
losses the control over the subsidiaries, the remaining equity will be re-
measured at its fair value on the date of loss of the control. The difference of
total amount of the consideration from disposal of equities plus the fair value of
the remaining equities less the shares calculated at the original shareholding
ratio in net asset of the original subsidiary which are continuously calculated as
of the acquisition date is included in the investment income of the period at the
loss of control and at the same time offset the goodwill. Other comprehensive
income associated with the equity investments of the original subsidiary, is
transferred into investment income of the period when control is lost.
Where the transactions of disposal of equity investments in subsidiaries until the loss of
control over belong to a package of transactions, and the transactions will be accounted
for as a transaction of disposal of equity investments in subsidiaries until the loss of
control; individual financial statements and consolidated financial statements will be
respectively accounted for:
(1) In the individual financial statements, the difference between each disposal cost
and book value of long-term equity investments corresponding to each disposal
of equity before loss of the control should be recognized as other comprehensive
income and should be transferred into the current profit or loss on the loss of the
control.
(2) In the consolidated financial statements, the difference between each disposal
cost and net asset share in the subsidiaries corresponding to each disposal of
investments before loss of the control should be recognized as other
comprehensive income and should be transferred into the current profit or loss
on the loss of the control.
Notes to the Financial Statements Page 28
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.20.5 Judgment criteria for joint control and significant influence
If the Company jointly controls an arrangement with other participants in accordance
with the relevant agreement, and the decision-making of activities having a significant
impact on the return on the arrangements is required to be unanimously agreed by
participants sharing control, which is deemed that the Company and other participants
jointly control an arrangement, such arrangement belongs to joint venture arrangement.
If joint venture arrangements are made by a separate entity, the Company is entitled to
the net assets of such separate body according to relevant agreement, such separate
entity is joint venture and measured at the equity method. If the Company is not entitled
to the net assets of such separate entity according to relevant agreement, such separate
entity is joint venture and the Company confirms the projects relating to share in
interest of joint operation, and conduct accounting treatment in accordance with the
related provisions of the Accounting Standards for Business Enterprises.
Significant influence refers to the power of the investor to participate in making
decisions on the financial and operating policies of the investee, but not the power to
control, or jointly control, the formulation of such policies with other parties. Through
one or more of the following circumstances, and comprehensively considering all the
facts and circumstances, the Company judges that it has a significant impact on the
investee: (1) representatives in the board of directors or similar organ of power of the
investee; (2) the process of preparing financial and operating policies the investee; (3)
significant transactions with the investee;(4) managers dispatched to the investee; (5)
key technical information provided to the investee.
3.21 Investment properties
Investment properties refer to the properties that are held for the purposes of earning rental
income, capital appreciation, or for combination thereof, including land use rights that have
been leased out; land use rights which are held and to be leased out after appreciation and
structures leased. Furthermore, as for the unoccupied constructions which are held for
operating lease, if the board of directors (or similar institution) makes a written resolution
which clearly states that the aforesaid construction is used for operating lease and the intent for
holding such construction will not change in the short-term future, such construction will be
presented as investment property.
The costs of the investment property of the Company shall be taken as its entry value, and the
cost of an investment property by acquisition consists of the acquisition price, relevant taxes,
and other expenses directly relegated to the asset; the cost of a self-built investment property
composes of the necessary expenses for building the asset to the hoped condition for use.
The Company's investment properties are subsequently measured at cost model, and the
depreciation or amortization will be withdrawn according to relevant regulations on fixed
assets and intangible assets.
When an investment property is changed for self-use, upon change, the investment property
shall be converted into fixed assets or intangible assets. When the self-use property is changed
to earn rentals or for capital appreciation, upon change, fixed assets or intangible assets shall
be converted into investment property. In case of the conversion, the book value of such
investment property before the conversion is regarded as the entry value of the same after the
conversion.
When an investment property is being disposed or permanently withdrawn from use and no
future economic benefits are expected from the disposal, the investment property shall be
derecognized. The difference of the revenue from disposal of investment properties such as
sales, transfer, retirement or damage deducting their book value and related taxes should be
included into the current profit or loss.
Notes to the Financial Statements Page 29
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.22 Fixed assets
3.22.1 Recognition criteria of fixed assets
Fixed assets are tangible assets that are held for the purpose of producing goods,
providing services, leasing or operating management, and having a life span of more
than one fiscal year. Fixed assets are recognized when they simultaneously meet the
following conditions:
(1) It is probable that the economic benefits relating to the fixed assets will flow
into the Company; and
(2) The costs of the fixed assets can be measured reliably.
3.22.2 Initial measurement of fixed assets
The fixed assets of the Company shall be initially measured at cost.
(1) Specifically, the costs of fixed assets externally purchased include purchase
price, import duties and other related taxes and surcharges, and any other
expenditures for making the assets reach working condition for their intended
use.
(2) The costs of self-built fixed assets consist of necessary expenditures incurred
before preparing the asset to reach the condition for its intended use;
(3) For fixed assets invested by an investor, the initial cost is the value stipulated in
the investment contract or agreement unless the value stipulated in the contract
or agreement is unfair;
(4) If the payment for a fixed asset is delayed beyond the normal credit conditions
and it is of the financing nature, the cost of the fixed asset shall be determined
on the basis of the current value of the purchase price. The difference between
the cost actually paid and the present value of purchase price will be capitalized
and included into the current profit or loss in the credit period.
3.22.3 Subsequent measurement and disposal of fixed assets
(1) Depreciation of fixed assets
The depreciation of fixed assets shall, within estimated useful lives, be made at
their book-entry values less estimated net residual value. For the fixed assets
with provision for impairment made, the amount of depreciation will be
determined according to the book value after deduction of the provision for
impairment and the remaining useful life in the future. No provision for fixed
assets which are fully depreciated and remain in use.
The Company determines the useful life and estimated net residual value of a
fixed asset according to its nature and using status, and reviews the useful life,
estimated net residual value and depreciation method of the fixed assets at the
end of the year. If there is any difference between the reviewing results and the
original estimated data, the Company will make some adjustments accordingly.
Depreciation method, depreciation life and annual depreciation rate of various
fixed assets are listed as follows:
Residual Annual
Depreciation Depreciation
Type value rate depreciation
method life (year)
(%) rate (%)
Buildings and Straight-line
constructions method 25-35 3 2.77-3.88
Machinery Straight-line
equipment method 7-15 3 6.47-13.86
Notes to the Financial Statements Page 30
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Residual Annual
Depreciation Depreciation
Type value rate depreciation
method life (year)
(%) rate (%)
Transportation Straight-line
equipment depreciation 8-10 3 9.70-12.13
Other Straight-line
equipment method 5-10 3 9.70-19.40
(2) Subsequent expenditure of fixed assets
If the subsequent disbursement relevant to a fixed asset meets the recognition
criteria on the fixed asset, it is included in the cost of fixed asset; otherwise, it is
included in the current profit or loss.
(3) Disposal of fixed assets
When fixed assets are disposed of or are expected to fail to generate economic
benefits after the use or disposal, the fixed assets shall be derecognized. The
incomes from sales, transfer, scrapping or damages of fixed assets after
deducting their book values and relevant taxes and surcharges are included in
the current profit or loss.
3.23 Construction in progress
3.23.1 Initial measurement of construction in progress
The Company's self-built construction on progress is valued at the actual cost which
consists of all necessary expenditures incurred before the assets for such construction
reaching to the predetermined serviceable condition, including all types of necessary
expenditures incurred during the construction period, the capitalized borrowing costs
incurred prior to the time when the construction is brought to the expected conditions
for use and other relevant costs, etc.
3.23.2 Criteria and timing for conversion of the construction in progress into the fixed
assets
For construction in progress, the book-entry values of the fixed assets are stated at total
expenditures incurred before such assets reach the working condition for their intended
use. Where the construction in progress has reached the predetermined serviceable
condition but the completion of settlement has not been handled, the estimated
construction value shall be transferred into the fixed assets based on construction
budget, cost or actual cost of construction, etc. as of the day reaching the predetermined
serviceable condition, and the depreciation of fixed assets shall be made according to
the Company's policy on fixed assets depreciation; when the completion of settlement
is finished, the original estimated value shall be adjusted at the actual cost, but the
depreciation already withdrawn shall not be adjusted.
3.24 Borrowing costs
3.24.1 Recognition principles of capitalization of borrowing costs
The borrowing costs incurred to the Company and directly attributable to the
acquisition and construction or production of assets eligible for capitalization should be
capitalized and recorded into relevant asset costs; other borrowing costs should be
recognized as costs according to the amount incurred and be included into the current
profit or loss.
Assets eligible for capitalization refer to fixed assets, investment properties, inventories
and other assets which may reach their intended use or sale status only after long-time
acquisition and construction or production activities.
Notes to the Financial Statements Page 31
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Borrowing costs are capitalized when they simultaneously meet the following
conditions:
(1) Asset expenditures, which include those incurred by cash payment, the transfer
of non-cash assets or the undertaking of interest-bearing debts for acquiring and
constructing or producing assets eligible for capitalization, have already been
incurred;
(2) Borrowing costs have already been incurred;
(3) The acquisition and construction or production activities which are necessary to
prepare the assets for their intended use or sale have already been started.
3.24.2 Capitalization period of borrowing costs
Capitalization period refers to the period from the beginning of capitalization to the
cease of capitalization, excluding the period of capitalization suspension of borrowing
costs.
Capitalization of borrowing costs should be ceased when the acquired and constructed
or produced assets eligible for capitalization have reached their intended use or sale
status.
When some projects among the acquired and constructed or produced assets eligible for
capitalization are completed and can be used separately, the capitalization of borrowing
costs of such projects should be ceased.
If all parts of the acquired and constructed or produced assets are completed but the
assets cannot be used or sold externally until overall completion, the capitalization of
borrowing costs should be ceased at the time of overall completion of the said assets.
3.24.3 Period of capitalization suspension of borrowing costs
If the acquisition, construction or production activities of assets eligible for
capitalization are abnormally interrupted and such condition lasts for more than three
months, the capitalization of borrowing costs should be suspended; if the interruption is
necessary procedures for the acquired, constructed or produced assets eligible for
capitalization to reach the working conditions for their intended use or sale, the
borrowing costs continue to be capitalized. Borrowing costs incurred during the
interruption are recognized as the current profit or loss and continue to be capitalized
until the acquisition, construction or production of the assets restarts.
3.24.4 Calculation method of capitalization amount of borrowing costs
The special borrowings’ interest expenses (excluding the interest income from unused
borrowings deposited in the bank or the investment income from the temporary
investment) and auxiliary expenses, before the acquired and constructed or produced
assets meeting with the capitalization conditions are eligible for the intended use, shall
be capitalized.
The interest amount of general borrowings to be capitalized should be calculated by
multiplying the weighted average of asset disbursements of the part of accumulated
asset disbursements exceeding special borrowings by the capitalization rate of used
general borrowings. The capitalization rate is calculated by weighted average interest
rate of general borrowings.
Where there are discounts or premiums on borrowings, amounts of discounts or
premiums should be amortized in each accounting period by the effective interest
method, and the amount of interest for each accounting period should be adjusted.
Notes to the Financial Statements Page 32
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.25 Right-of-use assets
The Company initially measures the right-of-use assets at cost. Such costs include:
1. The initial measurement amount of lease liabilities;
2. In case of any lease incentives, relevant amount of the lease incentives enjoyed shall be
deducted from the lease payment paid on or before the commencement date of the lease
term;
3. The initial direct costs incurred by the Company;
4. The costs incurred of the Company for demolishing and removing leased assets,
restoring the site where the leased assets are located, or restoring the leased assets to the
state agreed in the lease term, excluding the costs incurred for the production of
inventories.
After the commencement date of the lease term, the Company carries out subsequent
measurement of right-of-use asset using the cost method.
If there is a reasonable assurance that the ownership of leased assets can be acquired when the
lease term expires, the Company makes the provision during the remaining useful life for the
leased assets. If there is no reasonable assurance that the ownership of the leased assets can be
acquired when the lease term expires, the Company makes the provision over the lease term or
the remaining useful life for the leased assets, whichever is shorter. For the right-of-use assets
with provision for impairment made, the depreciation will be made according to the book
value after deduction of the provision for impairment and by reference to the above principle.
3.26 Intangible assets and development expenses
The intangible assets refer to the identifiable non-monetary assets which have no physical
shape and are possessed or controlled by the Company.
3.26.1 Initial measurement of intangible assets
The costs of externally acquired intangible assets comprise their purchase prices,
related taxes and surcharges and any other directly attributable expenditure incurred to
prepare the assets for their intended use. If the payment for an intangible asset is
delayed beyond the normal credit conditions and it is of the financing nature, the cost of
the intangible asset shall be determined on the basis of the present value of the purchase
price.
The intangible assets acquired and used by the debtor to repay debt in debt restructuring
should be recorded at the fair value of the intangible assets. The difference between the
book value of restructured debts and the fair value of intangible assets used to repay
debt should be included in the current profit or loss.
On the premise that non-monetary assets trade is of commercial nature and the fair
value of the assets traded in or out can be measured reliably, the intangible assets traded
in with non-monetary assets should be recognized at the fair value of the assets traded
out, unless any unambiguous evidence indicates that the fair value of the assets traded
in is more reliable; as to the non-monetary assets trade not meeting the aforesaid
premise, the book value of the assets traded out and related taxes and surcharges
payable should be recognized as the cost of the intangible assets, with gains or losses
not recognized.
For intangible assets acquired from business combination under common control, the
initial book value is initially recognized at the book value of the combinee; for
intangible assets acquired from business combination not under common control, the
initial book value is initially recognized at the fair value.
Notes to the Financial Statements Page 33
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Costs of intangible assets developed internally and independently include: the costs of
materials and labor services used to develop the intangible assets, the registration fee,
the amortization of other patents and franchise used in the process of development, the
interest expenses meeting the condition for capitalization, and other direct expenses for
preparing the intangible assets for their intended use.
3.26.2 Subsequent measurement of intangible assets
The useful lives of intangible assets are analyzed and judged by the Company upon
acquisition, and the intangible assets are divided into the intangible assets with definite
useful lives and intangible assets with indefinite useful life.
(1) Intangible assets with definite useful life
For intangible assets with definite useful lives, the Company shall adopt the
straight-line method for amortization within the period during which they can
bring economic benefits to the Company. Estimated useful life and basis of
intangible assets with definite useful lives as follows:
Item Estimated useful lives Basis
Land use right 30 -50 years Estimated useful life
Patent rights 5 years Estimated useful life
Software 5 years Estimated useful life
At the end of each reporting period, the Company shall review the useful lives
and amortization method of intangible assets with definite useful lives. If there
is any difference between the review results and the original estimated data, the
Company will make adjustments accordingly.
Upon review, the useful lives and amortization method of the intangible assets
as at the end of the year were not different from those estimated before.
(2) Intangible assets with indefinite useful lives
In case of the period when the intangible assets generate economic benefit for
enterprise cannot be forecasted, the intangible assets shall be deemed as the
intangible assets with indefinite useful lives.
The intangible assets with indefinite useful lives shall not be amortized during
the holding period. The useful lives of the intangible assets shall be reviewed at
the end of each period. If the useful lives of the intangible assets are still
uncertain after review at the end of the period, an impairment test shall be
continuously carried out during each accounting period.
3.26.3 Specific criteria for classifying research and development stages of internal
research and development projects of the Company
Research stage: research stage is the stage when creative and planned investigation and
research activities are conducted to acquire and understand new scientific or
technological knowledge.
Development stage: development stage is the stage when the research achievements
and other knowledge are applied to a plan or design, prior to the commercial production
or use, so as to produce any new or substantially improved material, device or product.
Expenditures in the research stage of an internal research and development project are
included in the current profit or loss when incurred.
Notes to the Financial Statements Page 34
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.26.4 Specific criteria for qualifying expenditure on the development stage for
capitalization
The Company classifies the expenditures for its internal research and development
projects into research expenditures and development expenditures. Expenditures in the
research phase should be included in the current profit or loss when they are incurred.
The expenditures in development phase will be capitalized only when all of the
following conditions are satisfied simultaneously: It is feasible technically to finish
intangible assets for use or sale; it is intended to finish and use or sell the intangible
assets; 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 or there is a potential market
for the intangible assets itself or the intangible assets will be used internally; with the
support of sufficient technologies, financial resources and other resources, it is able to
finish the development of the intangible assets, and it is able to use or sell the intangible
assets; and the expenditure attributable to the intangible asset during its development
phase can be measured reliably. The development expenditures that do not meet the
above conditions are included in the current profit or loss.
The Company's corresponding items will, after satisfying the above conditions, passing
the studies on technical feasibility and economic feasibility, and obtaining project
approval, enter into the development phase.
3.27 Impairment of long-term assets
The Company assesses whether there is any indication that long-term assets may be impaired
on the balance sheet date. If any indication shows the impairment of long-term assets, the
Company shall, on the basis of single item assets, estimate the recoverable amount. Where it is
difficult to do so, it shall determine the recoverable amount of the group assets on the basis of
the asset group to which the asset belongs.
The recoverable amount of assets is the higher of their fair values less costs to sell and the
present values of the future cash flows expected to be derived from the assets.
The measurement results of recoverable amount show that, if the recoverable amounts of
assets are lower than their book values, the book values of the assets shall be written down to
their recoverable amounts. The write-down amount is recognized as asset impairment losses
and included in the current profit or loss, while the provisions for asset impairment are made
accordingly. Losses from asset impairment shall not be reversed in subsequent accounting
periods once recognized.
After asset impairment losses are recognized, the depletion or amortization charges for the
impaired assets shall be accordingly adjusted in future periods to amortize their adjusted book
value of assets (less their estimated net residual values) over their remaining useful lives on a
systematic basis.
An impairment test shall be conducted each year for the goodwill from business combination
and intangible assets with indefinite useful lives whether there is any indication of impairment.
During impairment test of goodwill, the book value of goodwill shall be amortized to asset
group or asset group combination anticipated to benefit from the synergistic effect of business
combination. When making an impairment test on the relevant asset groups or combination of
asset groups containing goodwill, if any indication shows that the asset groups or
combinations of asset groups may be impaired, the Company shall first conduct an impairment
test on the asset groups or combinations of assets groups not containing goodwill, calculate the
recoverable amount and compare it with the relevant book value to recognize the
Notes to the Financial Statements Page 35
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
corresponding impairment loss. Then the Company shall conduct an impairment test on the
assets groups or combinations of assets groups containing goodwill, and compare the book
value of these assets groups or combinations of assets groups (including the book value of the
goodwill apportioned thereto) with the recoverable amount. Where the recoverable amount of
the relevant assets groups or combinations of assets groups is lower than the book value
thereof, the Company shall recognize the impairment loss of the goodwill.
3.28 Long-term deferred expenses
Long-term deferred expenses of the Company are measured at the actual costs and amortized
evenly over the estimated beneficial period. If an item of long-term deferred expense cannot
bring any benefit in future accounting periods, the amortized value thereof shall all be
transferred to the current profit or loss.
3.29 Contract liabilities
The obligation of transferring goods to customers for the consideration received or receivable
from customers shall be presented as contract liabilities.
3.30 Employee compensation
Employee compensations refer to multiform remuneration or compensation offered of the
Company in order to get services provided by its employees or sever the labor relation.
Employee compensation mainly includes short-term employee compensation, post-
employment benefits, dismissal benefits and other long-term employee benefits.
3.30.1 Short-term compensation
Short-term compensation refers to an employee remuneration paid to employees in full
within 12 months after the end of annual report period rendering relevant services by
employees, except for the post-employment benefits and dismissal benefits. During the
accounting period of an employee providing services, the Company recognizes the
employee compensation payable as liabilities and include them in related assets cost
and expenses in accordance with beneficiaries of the services offered by the employee.
3.30.2 Post-employment benefits
Post-employment benefits refer to all kinds of remuneration and benefits payable for
the Company in order to obtain services provided by employees and will pay to its
employees after they retire or sever the labor relation with the Company, excluding the
short-term remuneration and dismissal benefits.
Post-employment benefit plans of the Company can be divided into the defined
contribution plan and defined benefit plan.
Defined contribution plan for post-employment benefits mainly refers to participating
in the social basic endowment insurance, unemployment insurance, etc., which are
organized and implemented by local labor and social security institutions. During the
accounting period when employees render services to the Company, the deposited
amount payable calculated on the basis of the defined contribution plan is recognized as
liabilities and included in the current profit and loss or related cost of assets.
The Company bears no other payment obligations after regularly paying the
abovementioned amounts according to the standards prescribed by the State and
annuity plan.
Notes to the Financial Statements Page 36
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.30.3 Dismissal benefits
Dismissal benefits refer to the compensation for terminating the labor relation with the
employees prior to the expired date of the labor contract or for encouraging the
employees to voluntarily accept the layoff paid by the Group to the employees. The
dismissal benefits should be recognized as liabilities and recorded into the current profit
or loss on an earlier date when the Company is unable to unilaterally withdraw the plan
on the cancellation of labor relationship or the layoff proposal and when the Group
recognizes the cost related to restructuring concerning payment of dismissal benefits.
The Company offers the early retirement benefits to employees who accept the
arrangement of internal early retirement. Early retirement benefits refer to salaries to
and social insurance premiums and others paid for employees who have not been in the
state-specified retirement age, but are willing to quit their jobs approved by the
Company's management. The Company will pay the early retirement benefits to early
retired employees as of the day the early retirement arrangement begins till they are in
the normal retirement age. For the early retirement benefits, the Company conducts the
accounting treatment by comparing with the dismissal benefits. If the former conforms
to the recognition criteria related to dismissal benefits, the Company recognizes salaries
paid to and social insurance premiums paid for early retired employees as of day they
stop providing services till the day they are qualified for enjoying the normal retirement
as liabilities, and includes them in the current profit or loss all at once. Differences
caused by changes in actuarial assumptions and adjustment on benefit standards
relating to early retirement benefits are included in the current profit or loss when they
occur.
3.30.4 Other long-term employee benefits
Other long-term employee benefits provided for employees by the Company in
conformity with defined contribution plans should be accounted for according to the
defined contribution plans. Others should be accounted for according to the defined
benefit plans.
3.31 Estimated liabilities
3.31.1 Recognition criteria for estimated liabilities
Where the obligation related to contingency meets all the following conditions
simultaneously, it may be recognized as estimated liabilities by the Company:
This obligation is a present obligation of the Company;
The performance of this obligation may very probably lead to the flow of economic
interests out of the Company; and
The amount of the obligation can be measured reliably.
3.31.2 Measurement method of estimated liabilities
The estimated liabilities of the Company are initially measured as the best estimate of
expenses required for the performance of relevant present obligations.
The Company, when determining the best estimate, has had a comprehensive
consideration of risks with respect to contingencies, uncertainties and the time value of
money. If the time value of money is significant, the best estimates shall be determined
after discount of relevant future cash outflows.
The best estimate shall be accounted as follows in different circumstances:
If there is continuous range (or interval) for the necessary expenses, and probabilities of
occurrence of all the outcomes within this range are equal, the best estimate shall be
determined at the average amount of upper and lower limits within the range.
Notes to the Financial Statements Page 37
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
If there is no continuous range (or interval) for the necessary expenses, or probabilities
of occurrence of all the outcomes within this range are unequal despite such a range
exists, in case that the contingency involves a single item, the best estimate shall be
determined at the most likely outcome; if the contingency involves two or more items,
the best estimate should be determined according to all the possible outcomes with their
relevant probabilities.
When all or part of the expenses necessary for the settlement of an estimated liabilities
of the Company are expected to be compensated by a third party, the compensation
shall be separately recognized as an asset only when it is virtually certain that the
compensation will be received. The amount recognized for the compensation shall not
exceed the book value of the estimated liabilities.
3.32 Lease liabilities
The Company initially measures the Lease liabilities at the present value of the lease payments
that have not been paid on the lease commencement date. When calculating the present value
of minimum lease payment, the Company adopts the implicit rate of lease as the discount rate,
but if the implicit rate of lease cannot be reasonably determined, the Company’s incremental
borrowing rate will be adopted as the discount rate. Lease payments include:
1. For fixed payments and substantial fixed payments after deducting the relevant amount
of the lease incentive;
2. Variable lease payments depending on the index or ratio;
3. Exercise price of purchase option, provided that the Company reasonably determines
that it will exercise the option;
4. Payment needs to be paid for executing the lease termination option, provided that it is
reflected that the Company will execute the lease termination option during the lease
term.
5. The payments expected to be payable based on the residual value of the guarantee
provided by the Company;
The Company calculates the interest expense of the lease liability in each period during the
lease term according to the fixed discount rate, and records it into the current profit or loss or
the related asset costs.
The variable lease payments not included in the measurement of lease liabilities shall be
included in the current profit or loss or the related asset costs when they actually occur.
3.33 Revenue
The Company’s revenue mainly comes from the following business:
(1) Key client 1
(2) Client obtaining the goods after payment
(3) Post-sales client
3.33.1 General principles of revenue recognition
The Company recognizes the revenue according to the transaction price allocated to
such performance obligation when its performance obligations as stipulated in the
contract are fulfilled, that is, when the customer obtained control of the related goods or
services.
Notes to the Financial Statements Page 38
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Performance obligations are the commitments in the contracts, in which the Company
transfers clearly distinguishable goods or services to the customers.
Obtaining control of related goods refers to being able to dominate the use of the goods
and obtain almost all economic benefits from them.
The Company evaluates a contract on contract commencement date, identifies each
individual performance obligation contained in the contract, and determines whether
each individual performance obligation is to be performed at a particular time or at a
particular point in time. The Company recognizes revenue over a period in accordance
with the performance progress if one of the following conditions is met and the
performance obligation belongs to those within a certain period: (1) The customers
obtain and consume the economic benefits brought by the Company’s performance
while the Company is performing the obligation; (2) The customers are able to control
the goods under construction when the Company performs the obligations; (3) The
goods produced by the Company during the performance have irreplaceable uses, and
the Company has the right to receive payments for the portion of the performance that
has been completed till now during the whole contract period. Otherwise, the revenue
will be recognized at the certain time-point when the customer obtains the right of
control over relevant goods or services.
For performance obligations to be performed within a certain period, the Company uses
the input method to determine the appropriate performance progress based on the
nature of the goods and services. The output method determines the performance
progress based on the value of goods transferred to the customers (the input method is a
method to determine the performance progress based on the Company's inputs to fulfill
the performance obligation). When the performance progress cannot be reasonably
determined, if the cost incurred is expected to be compensated, the Company
recognizes the revenue according to the amount of the cost incurred until the
performance progress can be reasonably determined.
3.33.2 Specific method for recognition of revenue
The recognition of revenue from sales of automotive air conditioners is divided by
client group into three categories:
(1) Large customers. The cooperation method is mainly based on the client's
production demand, the company will ship the goods to the designated or
cooperative third-party logistics company, and the third-party logistics company
is responsible for storage and distribution services. Each month, the client issues
a pending notice according to the actual consumption of the production plan,
and the sales clerk issues an invoicing notice according to the client’s pending
notice and in combination with the client's consumption, contract unit price and
other information, and the finance department issues an invoice to confirm the
sales revenue.
(2) Client obtaining the goods after payment. According to the client's demand and
relevant invoicing information, after the client pays and confirms the payment,
the sales personnel will ship and issue invoicing notice according to the unit
price of the sales contract and the quantity demanded by the client, and the
Finance Department will issue an invoice to confirm the sales revenue.
(3) Post-sales client. The sales operation personnel will ship the goods to the clients
in accordance with the contract and the client's demand, and after reaching the
time point agreed in the contract, issue the invoicing notice in accordance with
the contract unit price and the shipping quantity agreed with the clients, and the
Finance Department will issue the invoice to confirm the sales revenue.
Notes to the Financial Statements Page 39
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.34 Government grants
3.34.1 Type
Government grants refer to the monetary or non-monetary assets obtained by the
Company from the government for free. Government subsidies are divided into
government subsidies related to assets and government subsidies related to income
according to the nature of assistance objects specified in relevant government
documents.
Asset-related government grants refer to government subsidies obtained by the
Company for forming long-term assets by acquisition, construction or other manners.
Income-related government grants refer to government grants excluding the asset-
related government grants.
3.34.2 Recognition of government grants
Where there is strong evidence showing that at the end of the period, the Company is
able to conform to conditions related to the financial support policy, and it is estimated
that the Company may receive the financial support funds, the government grant is
recognized when the amount receivable is confirming. Beyond that, the government
grant is recognized when it is actually received.
If government grants are monetary assets, they shall be measured at the amount
received or receivable. If government grants are non-monetary assets, they shall be
measured at its fair value; and if the fair value cannot be obtained in a reliable way,
they shall be measured at a nominal amount (RMB 1). Government grants measured at
nominal amount are included in the current profit or loss.
3.34.3 Accounting treatment methods
The Company determines whether a particular type of government grant business
should be accounted for under the gross method or the net method based on the
substance of the economic business. Normally, the Company uses only one method for
the same or similar government grant business and applies the method consistently to
such business.
Asset-related government grants should be used to offset the book value of relevant
assets or recognized as deferred income. Asset-related government grants are
recognized as deferred income and included in profit or loss by stages under reasonable
and systematic methods within the useful life of the assets constructed or purchased;
If income-related government grants are used to compensate the enterprise’s relevant
expenses or losses in future periods, such government grants should be recognized as
deferred income, and shall be included into current profit or loss or offset relevant costs
during the period of recognizing relevant costs or losses; if income-related government
grants are used to compensate the enterprise’s relevant expenses or losses incurred,
such income-related government grants are directly included into the current profit or
loss or offset relevant costs upon acquisition.
Government grants relevant to routine activities of the Company are included in other
income or used to offset relevant costs. Government grants irrelevant to routine
activities of the Company are included in the non-operating revenue and expenditure.
If the government grants in connection with the interest subsidies of policy-based
preferential loans are received, the related borrowing costs will be offset; if a policy-
based preferential loan rate is obtained from a lending bank, the amount of the
borrowing actually received is used as the recorded value of the borrowings, and the
related borrowing costs are calculated in accordance with the loan principal and the
policy-based preferential loan rate.
Notes to the Financial Statements Page 40
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
If the recognized government grants need to be returned, the carrying value of the
assets is adjusted if the book value of the relevant assets is offset upon initial
recognition; if there is a balance of relevant deferred income, the book value of the
relevant deferred income is offset and the excess part is recognized in the current profit
or loss; if there is no relevant deferred income, it is recognized directly in the current
profit or loss.
3.35 Deferred income tax assets/ deferred income tax liabilities
Deferred income tax assets and deferred income tax liabilities are calculated and recognized
based on differences (temporary differences) between tax base and book value of the assets
and liabilities. On the balance sheet date, the deferred income tax assets and deferred income
tax liabilities shall be measured at the tax rate applicable to the period during which the assets
are expected to be recovered or the liabilities are expected to be settled.
3.35.1 Recognition basis of deferred income tax assets
The Company recognizes the deferred income tax assets arising from deductible
temporary differences to the extent of the amount of the taxable income which may be
obtained and used to deduct the deductible temporary differences, deductible losses and
tax credits that can be carried forward to subsequent periods. However, in transactions
having the following features at the same time, the deferred income tax assets occurring
due to the initial recognition of assets or liabilities shall not be recognized: (1) the
transaction is not a business combination; (2) the transaction, when occurring, affects
neither accounting profit nor taxable income or deductible loss.
For the deductible temporary differences arising from investments in associates and
joint ventures, the deferred income tax assets will be accordingly recognized when
meeting the following conditions at the same time: the temporary differences may be
reversed in the foreseeable future and they can be used to offset the taxable income of
deductible temporary differences in the future.
3.35.2 Recognition basis of deferred income tax liabilities
The Company recognized outstanding taxable temporary differences for current or prior
periods as deferred income tax liabilities. They exclude:
(1) Temporary differences arising from initial recognition of goodwill;
(2) Transactions or matters arising from non-business combinations, which do not
affect either the accounting profit or the taxable or deductible temporary
differences formed by the taxable income (or deductible losses).
(3) For taxable temporary differences related to the investments in subsidiaries and
associates, the time of their reversal can be controlled and they are not likely to
be reversed in the foreseeable future.
3.36 Leases
On the contract commencement date, the Company evaluates whether the contract is a lease or
includes a lease. If any party to a contract has exchanged the right to control the use of one or
more identified assets within a certain period for consideration, the contract is concluded for
lease or involved with lease.
3.36.1 Splitting of lease contract
If the contract contains multiple individual leases, the Company will split the contract
and carry out the accounting treatment for lease individually.
When a contract contains both lease and non-lease components, the Company splits the
lease and non-lease components. The lease component should be accounted for in
accordance with the lease guidelines, while the non-lease component should be
accounted for in accordance with other applicable accounting standards for business
enterprises.
Notes to the Financial Statements Page 41
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.36.2 Consolidation of lease contract
Two or more contracts containing leases entered into by the Company and the same
counterparty or its related parties at the same or similar times are combined into one
contract for accounting purposes when one of the following conditions is met:
(1) The two or more contracts are entered into based on an overall business purpose
and constitute a package transaction, the overall business purpose of which
cannot be understood if not considered as a whole.
(2) The amount of consideration for one of the two or more contracts depends on
the pricing or performance of the other contracts.
(3) The rights to use the assets transferred by the two or more contracts, taken
together, constitute a separate lease.
3.36.3 Accounting treatment of the Company as the lessee
On the commencement date of the lease term, the Company recognizes leases other
than short-term lease and low-value asset lease applied under the simplified treatment
as the right-of-use assets and lease liabilities.
(1) Short-term lease and lease of low-value assets
Short-term lease refers to leases that do not exceed 12 months and exclude any
purchase option. Low-value asset lease refers to the lease of a single lease asset
with lower value when it is brand new.
(2) For the accounting policies of right-of-use assets and lease liabilities, please see
Note 3.25 and Note 3.32.
3.36.4 Accounting treatment of the Company as the lessor
(1) Classification of lease
Leases of the Company are classified as finance lease and operating lease on the
lease commence date. Lease under which all the risks and rewards related to the
ownership of assets are materially transferred is recognized as finance lease, the
ownership of such lease may be transferred finally or not transferred. Operating
lease refers to the leases other than finance lease.
A lease is normally classified as a finance lease when one or more of the
following circumstances exist:
1) The ownership of the leased asset is transferred to the lessee when the
term of lease expires;
2) The lessee has the option to purchase the leased asset, and the purchase
price agreed is far lower than the leased asset’s fair value when it is
expected to exercise the option, so it can be reasonably assured that the
lessee will exercise the option on the lease commencement data.
3) Even if the ownership of the asset is not transferred, the lease term covers
the majority of the leased asset's usable life.
4) On the lease commencement date, the present value of the lease receipt is
almost equal to the fair value of the leased assets.
5) The leased asset is of such a special nature that only the lessee can use it
without making major modifications.
Notes to the Financial Statements Page 42
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
The Company may classify it as a finance lease when one or more of the
following signs exist:
1) If the lessee revokes the lease, the loss to the lessor caused by the
revocation of lease is borne by the lessee.
2) Gains or losses arising from fluctuations in the fair value of the residual
value of the asset are attributed to the lessee.
3) The lessee has the ability to continue the lease to the next period at a rent
much lower than the market level.
(2) Accounting treatment of finance lease
On the lease commencement date, the Company recognizes the finance leases as
finance lease receivables and derecognizes assets under the finance lease.
At the initial measurement of the finance lease receivable, the sum of the
unguaranteed residual value and the present value of the lease receipts not yet
received at the commencement date of the lease, discounted at the interest rate
embedded in the lease, is used as the book value of the finance lease receivable.
Lease receipts include:
1) For fixed payments and substantial fixed payments after deducting the
relevant amount of the lease incentive;
2) Variable lease payments depending on the index or ratio;
3) Where it is reasonably certain that the lessee will exercise the option to
purchase, the lease receipts include the exercise price of the option to
purchase;
4) Where the lease term reflects that the lessee will exercise the option to
terminate the lease, the lease receipt includes the amount to be paid by
the lessee for exercising the option to terminate the lease;
5) The residual value of the guarantee provided to the lessor by the lessee, a
party related to the lessee, and an independent third party with the
financial ability to meet the guarantee obligation.
The Company calculates and recognizes the interest income for each period of
the lease term based on a fixed lease embedded interest rate. Variable lease
payments acquired that are not included in the net lease investment
measurement are recognized in the current profit or loss when they are actually
incurred.
(3) Accounting treatment of operating lease
The Company recognizes lease receipts from operating leases as lease revenue
on a straight-line basis or systematic and rational method over the respective
periods of the lease term. Initial direct costs relating to operating lease incurred
by the Company are capitalized, and shall be included in the current profit or
loss on the same basis as the recognition of lease revenue during the lease term.
The variable lease payable that is not included in the lease receivable shall be
included in the current profit or loss at the time of actual occurrence.
Notes to the Financial Statements Page 43
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.36.5 Sale-and-leaseback deals
(1) The Company as the seller and lessee
If the asset transfer in the sale-leaseback transaction belongs to sales, the
Company measures the right-of-use asset formed by the sale-leaseback
according to the part related to the use-right obtained from the leaseback in the
original book value of assets, and only recognizes the relevant gains and losses
only for the rights transferred to the lessor; If the fair value of the sales
consideration is different from the fair value of the asset, or if the lessor does not
collect rent at market price, the Company accounts for the sales consideration
below market price as prepaid rent and the amount above market price as
additional financing provided by the lessor to the lessee; and adjusts the related
gain or loss on sale at fair value.
If the asset transfer in the sale-and-leaseback transaction does not belong to the
sale, the Company continues to confirm the transferred assets and recognizes a
financial liability equivalent to the transfer income.
(2) The Company as the buyer and lessor
If the transfer of assets in a sale-and-leaseback transaction is a sale, the
Company accounts for the transfer accordingly in accordance with the purchase
of the asset and accounts for the lease of the asset in accordance with the leasing
standards. If the fair value of the sales consideration is different from the fair
value of the asset, or if the Company does not collect rentals at market price, the
Company accounts for the amount of the sales consideration that is lower than
the market price as rentals received in advance and accounts for the amount that
is higher than the market price as additional financing provided by the Company
to the lessee; and adjusts the rental income at market price.
If the transfer of assets in a sale-and-leaseback transaction is not a sale, the
Company recognizes a financial asset equal to the transfer proceeds.
3.37 Discontinued operation
The Company recognizes the component, meeting any of the following conditions that can be
separately distinguished and that has been disposed by the Company or classified as held for
sale by the Company, as the discontinued operation:
(1) the component represents a separate major business or a sole major business area;
(2) the component is a part of a related plan where an independent major business or a sole
major business area will be disposed as planned; or
(3) the component is a subsidiary acquired only for re-sale.
The impairment loss from discontinued operation, reversed amount and other profit or loss
from operation as well as profit or loss from disposal shall be presented as profit or loss from
discontinued operation in the income statement.
3.38 Work safety expenses
The Company withdraws the work safety expenses according to national provisions, include in
the cost of related products or the current profit or loss, and included in special reserves at the
same time. When withdrawn safe production costs are used belong to expenses, such costs
shall be directly deducted from special reserves. Where fixed assets form, incurred expenses
are accumulated under the item construction in progress and are recognized as fixed assets
when the safe project is completed and reaches the working conditions for its intended;
meanwhile, special reserves shall be offset according to the costs of fixed assets and the
accumulated depreciation of the same amount shall be recognized. Provision for depreciation
of fixed assets will be no longer made in subsequent periods.
Notes to the Financial Statements Page 44
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
3.39 Changes in significant accounting policies and accounting estimates
3.39.1 Adjustments for changes in accounting policies
(1) Implementation of the Interpretation No. 15 of the Accounting Standards for
Business Enterprises on the Company
On December 31,2021, the Ministry of Finance issued the Interpretation No.15
of Accounting Standards for Business Enterprises (CK [2021] No.35, the
"Interpretation No.15"), wherein the “accounting treatment of the external sales
of products or by-products produced by an enterprise before the fixed assets
reach their intended serviceable condition or in the research and development
process (‘trial operation sales’)”and “judgment on the loss contract”, shall be
implemented as of January 1, 2022.
Implementation of the Interpretation No. 15 of the Accounting Standards for
Business Enterprises has no impact on the Company.
(2) Implementation of the Interpretation No. 16 of the Accounting Standards for
Business Enterprises on the Company
On December 13,2022, the Ministry of Finance has issued the Interpretation
No.16 of Accounting Standards for Business Enterprises (CK [2022] No.31, the
"Interpretation No.16"). In the three accounting treatments, accounting for
deferred income taxes related to assets and liabilities arising from a single
transaction for which no exemption from initial recognition applies shall be
implemented as of January 1, 2023, which allowed to be implemented in
advance by the enterprise since the issue year; the Company has not
implemented the relevant accounting in advance in this year; “accounting
treatment for the income tax effects of dividends related to financial instruments
classified as equity instruments by the issuer and “accounting treatment for
modifying cash-settled share-based payment to equity-settled share-based
payment” shall be implemented as of the date of promulgation.
Implementation of the Interpretation No. 16 of the Accounting Standards for
Business Enterprises has no impact on the Company.
3.39.2 Adjustments for changes in accounting estimates
There were no changes in significant accounting estimates during the reporting period.
4 Taxation
4.1 Major tax types and tax rates applicable to the Company
Basis of tax assessment/
Tax type Tax rate Remark
Revenue type
Value added tax (VAT) Taxable income 13%, 9%, 6%
Urban maintenance and
construction tax Turnover tax payable 7%
Educational surtax Turnover tax payable 3%
Local educational surtax Turnover tax payable 2%
Enterprise income tax Taxable income 25% or 15%
Notes to the income tax rates for different taxpayers:
Name of taxpayer Income tax rate
Chongqing Jianshe Vehicle System Co., Ltd. 25%
Chongqing Jianshe Automobile A/C Co., Ltd. 15%
Chongqing Pingshan TK Carburetor Co., Ltd. 15%
Notes to the Financial Statements Page 45
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
4.2 Tax preference policies and their basis
1. Chongqing Jianshe Automobile A/C Co., Ltd., a subsidiary of the Company, was
certified as a high-tech enterprise on November 28, 2022 and obtained a high-tech
enterprise qualification certificate with certificate No. GR202251102508, which is valid
for three years and is subject to a reduced income tax rate of 15% for the calculation of
enterprise income tax from 2022 to 2024.
2. According to the Circular of the Ministry of Finance, the General Administration of
Customs and the State Taxation Administration on Issues concerning Tax Policies for
In-depth Implementation of Western Development Strategies (CS [2011] No.58), from
January 1, 2011 to December 31, 2020, the enterprise income tax on enterprises
established in western areas and engaging in industries encouraged by the State is
levied at a reduced tax rate of 15%; According to the Announcement on Continuing the
Western Development Enterprise Income Tax Policy (Announcement of the Ministry of
Finance, the State Taxation Administration and the National Development and Reform
Commission [2020] No.23), from January 1, 2021 to December 31, 2030, the
enterprise income tax on encouraged enterprises in western areas shall be levied at
15%. The enterprise income tax of the Company’s subsidiary Chongqing Pingshan TK
Carburetor Co., Ltd. was 15% in 2022.
3. The Company’s export tax refund applies to the policy for tax exemption, offset and
refund at tax refund rate of 13%.
4.3 Other notes
None.
5. Notes to the main items of the consolidated financial statements
(The following amounts are expressed in RMB unless otherwise stated, and the term "end of the
period" refers to the date of December 31, 2022, the term "beginning of the period" refers to the date
of January 1, 2022, the term "end of the previous period" refers to December 31, 2021.)
5.1 Monetary funds
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Cash on hand
Bank deposits 169,994,534.05 23,738,523.19
Other monetary funds 9,959,988.94 67,940,000.00
Total 179,954,522.99 91,678,523.19
Including: total deposits with finance
company 166,896,601.57 67,084,183.76
Remark: The Company participated in the centralized fund management plan of China South
Industries Group Corporation. As of December 31, 2022, total deposits with finance company
reached RMB166,896,601.57.
As of December 31, 2022, details of restricted monetary funds of the Company are as follows:
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Bank acceptance bill deposit 9,959,988.94 27,940,000.00
Time deposits or call deposits used for
guarantee - 40,000,000.00
Total 9,959,988.94 67,940,000.00
Notes to the Financial Statements Page 46
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.2 Notes receivable
5.2.1 Presentation of notes receivable by category
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Bank acceptance bills - 2,220,000.00
Commercial acceptance bills -
Total - 2,220,000.00
5.3 Accounts receivable
5.3.1 Disclosure of accounts receivables by aging
Balance as at Balance as at
Aging
December 31, 2022 January 1, 2022
1 - 6 months (inclusive) 112,999,606.01 140,550,094.23
Within 6 months -1 year 252,801.19 8,612,280.95
1 - 2 years 404,993.90 1,372,687.55
2 - 3 years 299,630.17 1,412,742.18
3 - 4 years 1,412,714.62 10,537,543.42
4 - 5 years 10,530,065.63 8,871,569.58
Over 5 years 22,394,794.03 13,560,196.39
Sub-total 148,294,605.55 184,917,114.30
Less: provision for bad debts 34,584,390.83 35,583,828.66
Total 113,710,214.72 149,333,285.64
5.3.2 Disclosure under the methods of provision for bad debts by category
Balance as at December 31, 2022
Book balance Provision for bad debts
Proportion
Category
Proportion of Book value
Amount Amount
(%) provision
(%)
Accounts
receivable with
provision for bad
debts accrued on
an individual
basis 28,054,549.77 18.92 28,054,549.77 100.00
Accounts
receivable with
provision for bad
debts accrued on
a portfolio basis 120,240,055.78 81.08 6,529,841.06 5.43 113,710,214.72
Including:
Portfolio 1:
Related parties
within the scope
of consolidation
Portfolio 2:
Aging portfolio 120,240,055.78 81.08 6,529,841.06 5.43 113,710,214.72
Total 148,294,605.55 100.00 34,584,390.83 23.32 113,710,214.72
Notes to the Financial Statements Page 47
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
(Continued)
Balance as at January 1, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Accounts
receivable
with
provision for
bad debts
accrued on
an individual
basis 28,666,222.39 15.50 28,666,222.39 100.00 -
Accounts
receivable
with
provision for
bad debts
accrued on a
portfolio
basis 156,250,891.91 84.50 6,917,606.27 4.43 149,333,285.64
Including:
Portfolio 1:
Related
parties
within the
scope of
consolidation
Portfolio 2:
Aging
portfolio 156,250,891.91 84.50 6,917,606.27 4.43 149,333,285.64
Total 184,917,114.30 100.00 35,583,828.66 19.24 149,333,285.64
5.3.3 Accounts receivable with provision for bad debts accrued on an individual basis
Balance as at December 31, 2022
Enterprise name Provision for Proportion of Reason for
Book balance
bad debts provision (%) provision
Chongqing
Hyosow Autopart Expected to be
Co., Ltd. 12,723,992.31 12,723,992.31 100.00 irrecoverable
Chongqing Bisu
Yunbo Power
Technology Co., Expected to be
Ltd. 5,217,475.35 5,217,475.35 100.00 irrecoverable
Hafei Motor Co., Expected to be
Ltd. 3,999,944.43 3,999,944.43 100.00 irrecoverable
Hangzhou
Fuyang
Instrument
General Factory Expected to be
Co., Ltd. 2,681,594.66 2,681,594.66 100.00 irrecoverable
Notes to the Financial Statements Page 48
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at December 31, 2022
Enterprise name Provision for Proportion of Reason for
Book balance
bad debts provision (%) provision
Chongqing Kaite
Engine
Technology Co., Expected to be
Ltd. 1,481,654.59 1,481,654.59 100.00 irrecoverable
Hubei Meiyang
Automobile Expected to be
Industry Co., Ltd. 1,408,811.40 1,408,811.40 100.00 irrecoverable
Dfsk Motor Co.,
Ltd. Chongqing Expected to be
Branch 102,720.66 102,720.66 100.00 irrecoverable
Jiangxi Zhicheng
Automobile Co.,
Ltd. Jingdezhen Expected to be
Company 182,777.11 182,777.11 100.00 irrecoverable
GAC GONOW
Automobile Co.,
Ltd. Luqiao Expected to be
Company 75,821.20 75,821.20 100.00 irrecoverable
GAC GONOW
Automobile Co., Expected to be
Ltd. 67,998.51 67,998.51 100.00 irrecoverable
BAIC Heibao
(Weihai)
Automobile Co., Expected to be
Ltd. 51,021.77 51,021.77 100.00 irrecoverable
Dongying Ji 'ao
Automobile Co., Expected to be
Ltd. 48,579.85 48,579.85 100.00 irrecoverable
Sichuan Yema
Automobile Co., Expected to be
Ltd. 12,157.93 12,157.93 100.00 irrecoverable
Total 28,054,549.77 28,054,549.77 100.00
5.3.4 Accounts receivable with provision for bad debts accrued on a portfolio basis
(1) Portfolio 1 Aging portfolio
Balance as at December 31, 2022
Aging Provision for Proportion of
Book balance
bad debts provision (%)
1 - 6 months (inclusive) 112,999,606.01 - -
Within 6 months -1 year 252,801.19 12,640.05 5.00
1 - 2 years 404,993.90 40,499.40 10.00
2 - 3 years 104,647.32 31,394.20 30.00
3 - 4 years 61,962.82 30,981.41 50.00
4 - 5 years 8,592.69 6,874.15 80.00
Over 5 years 6,407,451.85 6,407,451.85 100.00
Total 120,240,055.78 6,529,841.06 5.43
Notes to the Financial Statements Page 49
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.3.5 Provision, reversal or recovery of provision for bad debts in 2022
Balance as at Changes in 2022 Balance as at
Category January 1, Recovery Charge- Other December 31,
Provision
2022 or reversal off changes 2022
Accounts
receivable
with
provision for
bad debts
accrued on
an individual
basis
Accounts
receivable
with
provision for
bad debts
accrued on a
portfolio
basis 35,583,828.66 - 999,437.83 - - 34,584,390.83
Including:
Portfolio 1
Consolidated
related
parties -
Portfolio 2:
Aging
portfolio 35,583,828.66 - 999,437.83 - 34,584,390.83
Total 35,583,828.66 - 999,437.83 - 34,584,390.83
5.3.6 There were no accounts receivable actually charged off in 2022.
5.3.7 Top 5 of accounts receivable as at December 31, 2022, presented by debtor
Balance as at Proportion in the ending Accrued
Enterprise name December 31, balance of accounts provision for
2022 receivable (%) bad debts
PSA (Peugeot)
Company 58,752,034.55 39.62 -
Chongqing Hyosow
Autopart Co., Ltd. 12,723,992.31 8.58 12,723,992.31
Chongqing Changan
Automobile
Company Limited 7,072,474.53 4.77 -
Chongqing
Yongchuan Great
Wall Automobile
Parts Co., Ltd. 5,354,795.63 3.61 -
Chengdu Henggao
Mechanical
Electronics Co., Ltd. 5,250,156.85 3.54 -
Total 89,153,453.87 60.12 12,723,992.31
Notes to the Financial Statements Page 50
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.4 Receivables financing
5.4.1 Receivables financing
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Notes receivable 17,548,591.75 29,250,840.86
Total 17,548,591.75 29,250,840.86
5.4.2 Changes in receivables financing and fair values thereof in 2022
Balance as at Increase or decrease in Balance as at
January 1, 2022 2022 December 31, 2022
Item
Fair value Fair value Fair value
Costs Cost Cost
Changes Changes Changes
Notes
receivable 29,250,840.86 -11,702,249.11 17,548,591.75
Total 29,250,840.86 -11,702,249.11 17,548,591.75
The Company believes that the fair value of the receivables financing measured at fair
value through the other comprehensive income is similar to the book value thereof due
to the short remaining period.
5.4.3 Provision for bad debts
As of December 31, 2022, the Company believes that its receivables financing has no
significant credit risk, and no significant loss will cause due to default.
5.4.4 Notes receivable of the Company as at December 31, 2020 that have been endorsed
or discounted but not matured on the balance sheet date
Amount Amount not
Item derecognized as at derecognized as at
December 31, 2022 December 31, 2022
Bank acceptance bills 75,751,516.19
Commercial acceptance bills
Total 75,751,516.19
5.5 Advances to suppliers
5.5.1 Presentation of advances to suppliers by aging
Balance as at December 31, Balance as at January 1,
2022 2022
Aging
Proportion Proportion
Amount Amount
(%) (%)
Within 1 year 3,577,455.19 88.89 6,871,577.60 95.06
1 - 2 years 90,007.50 2.24 127,554.40 1.76
2 - 3 years 127,554.40 3.17
Over 3 years 229,348.93 5.70 229,348.93 3.18
Total 4,024,366.02 100.00 7,228,480.93 100.00
5.5.2 Top 5 of advances to suppliers as at December 31, 2022 presented by supplier
Balance as at Proportion in total
Name of entity
December 31, 2022 advances to suppliers (%)
Chongqing Jiantao Aluminum
Co., Ltd. 1,647,870.00 40.95
Asahi Trading (Shanghai) Co.,
Ltd. 353,404.85 8.78
Chongqing Bangzhou Import
and Export Trade Co., Ltd. 265,000.00 6.58
Notes to the Financial Statements Page 51
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at Proportion in total
Name of entity
December 31, 2022 advances to suppliers (%)
Chongqing Kanghongsheng
Industry Co., Ltd. 172,800.00 4.29
Suzhou Bearing Factory Co.,
Ltd. 169,785.97 4.22
Total 2,608,860.82 64.82
5.6 Other receivables
5.6.1 Disclosure by aging
Balance as at Balance as at
Aging
December 31, 2022 January 1, 2022
1 - 6 months (inclusive) 1,530,044.17 1,431,664.33
Within 6 months -1 year 200,000.00 -
1 - 2 years - 1,223,146.45
2 - 3 years 1,223,146.45 255,723.62
3 - 4 years 255,723.62 -
4 - 5 years - -
Over 5 years 4,774,182.33 4,774,182.33
Sub-total 7,983,096.57 7,684,716.73
Less: provision for bad debts 6,263,052.40 6,253,052.40
Total 1,720,044.17 1,431,664.33
5.6.2 Classification of other receivables by the nature of payment
Balance as at Balance as at
Nature of payment
December 31, 2022 January 1, 2022
Reserves, security deposits,
advance payment for social
insurance premiums for
employees, etc. 284,542.01 1,431,664.33
Current accounts 7,698,554.56 6,253,052.40
Total 7,983,096.57 7,684,716.73
5.6.3 Disclosure of impairment of financial assets by three stages
Balance as at December 31, 2022 Balance as at January 1, 2022
Item Book Provision for Provision for
Book value Book balance Book value
balance bad debts bad debts
Stage I 5,451,917.33 3,731,873.16 1,720,044.17 5,319,771.74 3,888,107.41 1,431,664.33
Stage II - - - -
Stage III 2,531,179.24 2,531,179.24 - 2,364,944.99 2,364,944.99 -
Total 7,983,096.57 6,263,052.40 1,720,044.17 7,684,716.73 6,253,052.40 1,431,664.33
5.6.4 Disclosure under the methods of provision for bad debts by category
Balance as at December 31, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables
with provision for
bad debts accrued
on an individual
basis 2,531,179.24 31.71 2,531,179.24 100.00 -
Notes to the Financial Statements Page 52
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at December 31, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables
with provision for
bad debts accrued
on a portfolio basis 5,451,917.33 68.29 3,731,873.16 68.45 1,720,044.17
Including:
Portfolio 1
Consolidated
related parties
Portfolio 2: Aging
portfolio 5,451,917.33 68.29 3,731,873.16 68.45 1,720,044.17
Total 7,983,096.57 100.00 6,263,052.40 78.45 1,720,044.17
(Continued)
Balance as at January 1, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables
with provision for
bad debts accrued
on an individual
basis 2,364,944.99 30.77 2,364,944.99 37.82 -
Other receivables
with provision for
bad debts accrued
on a portfolio
basis 5,319,771.74 69.23 3,888,107.41 73.09 1,431,664.33
Including:
Portfolio 1
Consolidated
related parties
Portfolio 2: Aging
portfolio 5,319,771.74 69.23 3,888,107.41 73.09 1,431,664.33
Total 7,684,716.73 100.00 6,253,052.40 81.37 1,431,664.33
5.6.5 Other receivables with provision for bad debts accrued on an individual basis
Balance as at December 31, 2022
Enterprise name Book Provision for Proportion of Reason for
balance bad debts provision (%) provision
Chongqing Jianshe
Lijue Industrial Expected to be
Co., Ltd. 1,478,870.07 1,478,870.07 100.00 irrecoverable
Expected to be
Temporary supplier 390,655.08 390,655.08 100.00 irrecoverable
Ningbo Jianshe
Motorcycle Co., Expected to be
Ltd 329,628.73 329,628.73 100.00 irrecoverable
Chongqing Yiqun
Industry and Trade Expected to be
Co., Ltd. 91,900.00 91,900.00 100.00 irrecoverable
Notes to the Financial Statements Page 53
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at December 31, 2022
Enterprise name Book Provision for Proportion of Reason for
balance bad debts provision (%) provision
Wage security
deposit for migrant
workers in
Chongqing
Huachuang
Science and
Technology Expected to be
Complex Project 88,000.00 88,000.00 100.00 irrecoverable
Chongqing Expected to be
Customs 78,825.36 78,825.36 100.00 irrecoverable
Yangzhou
Qionghua Coating
Engineering
Equipment Co., Expected to be
Ltd. 56,500.00 56,500.00 100.00 irrecoverable
Chongqing
Jinxiang Lifting
Equipment
Manufacturing Expected to be
Co., Ltd. 16,800.00 16,800.00 100.00 irrecoverable
Total 2,531,179.24 2,531,179.24 100.00
5.5.6 Other receivables with provision for bad debts made by portfolio
(1) Portfolio 2 Aging portfolio
Balance as at December 31, 2022
Aging Book Provision for Proportion of
balance bad debts provision (%)
1 - 6 months (inclusive) 1,530,044.17 - -
Within 6 months -1 year 200,000.00 10,000.00 5.00
1 - 2 years
2 - 3 years
3 - 4 years
4 - 5 years
Over 5 years 3,721,873.16 3,721,873.16 100.00
Total 5,451,917.33 3,731,873.16 68.45
5.6.7 Provision for bad debts of other receivables
Stage I Stage II Stage III
Lifetime Lifetime
Expected
Provision for bad expected credit expected credit
credit loss in Total
debts loss (without loss (with
future 12
credit credit
months
impairment) impairment)
Balance as at
January 1, 2022 3,888,107.41 - 2,364,944.99 6,253,052.40
In 2022, balance as
at January 1, 2022 —— —— —— ——
— Transferred in
Stage II
— Transferred in
Stage III
Notes to the Financial Statements Page 54
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Stage I Stage II Stage III
Lifetime Lifetime
Expected
Provision for bad expected credit expected credit
credit loss in Total
debts loss (without loss (with
future 12
credit credit
months
impairment) impairment)
— Reversal from
Stage II
— Reversal from
Stage I
Provision in the
current period 166,234.25 166,234.25
Reversal in the
current period 156,234.25 156,234.25
Write-off in the
current period - - - -
Charge-off in the
current period - - - -
Other changes - - - -
Balance as at
December 31, 2022 3,731,873.16 - 2,531,179.24 6,263,052.40
5.6.8 There was no actual charge-off of other receivables in 2022
5.6.9 Top 5 of other receivables as at December 31, 2022 presented by debtor
Proportion in Provision for
Balance as the ending bad debts
Name of Nature of
at December Aging balance of Balance as
entity payment
31, 2022 other at December
receivables (%) 31, 2022
Shenzhen
Jianshe
Motorcycle Current Over 5
Co., Ltd. accounts 3,013,664.00 years 37.75 3,013,664.00
Chongqing
Jianshe
Lijue
Industrial Current Over 5
Co., Ltd. accounts 1,478,870.07 years 18.53 1,478,870.07
Chongqing
Jianshe
Industry 1-6
(Group) Current months
Co., Ltd. accounts 1,294,150.66 (inclusive) 16.21 -
Ningbo
Jianshe
Chongqing Current Over 5
Office accounts 692,035.31 years 8.67 692,035.31
Temporary Current Over 5
supplier accounts 390,655.08 years 4.89 390,655.08
Total / 6,869,375.12 / 86.05 5,575,224.46
Notes to the Financial Statements Page 55
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.7 Inventories
5.7.1 Classification of inventories
Balance as at December 31, 2022 Balance as at January 1, 2022
Provision for Provision for
Item
Book balance inventory Book value Book balance inventory Book value
depreciation depreciation
Raw
materials 23,279,997.14 - 23,279,997.14 24,131,134.23 24,131,134.23
Goods in
progress 9,357,445.63 42,930.77 9,314,514.86 8,477,431.32 42,930.77 8,434,500.55
Stock
commodities 98,610,353.14 2,170,864.12 96,439,489.02 173,420,234.47 2,170,864.12 171,249,370.35
Revolving
materials 4,120,591.96 1,294,020.05 2,826,571.91 4,198,620.71 1,294,020.05 2,904,600.66
Total 135,368,387.87 3,507,814.94 131,860,572.93 210,227,420.73 3,507,814.94 206,719,605.79
5.7.2 Provision for inventory depreciation
Balance as Increase in 2022 Decrease in 2022 Balance as
Item at January 1, Write- at December
Provision Others Reversal Others
2022 off 31, 2022
Goods in
progress 42,930.77 - - - - 42,930.77
Stock
commodities 2,170,864.12 - - - - 2,170,864.12
Revolving
materials 1,294,020.05 - - - - 1,294,020.05
Total 3,507,814.94 - - - - 3,507,814.94
5.8 Assets held for sale
Balance as at December 31, 2022 Balance as at January 1, 2022
Item Book Provision for Provision for
Book value Book balance Book value
balance impairment impairment
Fixed
assets 91,236,342.06 91,236,342.06
Land use
right 13,746,654.05 13,746,654.05
Total 104,982,996.11 104,982,996.11
5.9 Other current assets
5.9.1 Presentation of other current assets by item
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Input VAT to be deducted 1,468,399.16 4,585,170.16
Total 1,468,399.16 4,585,170.16
Notes to the Financial Statements Page 56
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.10 Long-term equity investments
Increase/decrease in 2022 Balance
Profit or of
Cash
loss on provisio
Other dividen
investme Adjustmen Balance as n for
Balance as Increas Decrea chan ds or Provisio
Investe nts t to other at impair
at January e in se in ges profits n for Oth
e recogniz comprehe December ment as
1, 2022 investm investm in declare impair ers
ed under nsive 31, 2022 at
ent ent equit d to be ment
the income Decemb
y distribu
equity er 31,
ted
method 2022
I. Joint
venture
s
Chongq
ing
Hanon
Jianshe
Therma
l
System
s Co., 201,984,26 8,128,05 210,112,32
Ltd. 8.72 2.32 1.04
201,984,26 8,128,05 210,112,32
Total 8.72 2.32 1.04
Notes to the Financial Statements Page 57
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.11 Other non-current financial assets
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Financial assets measured at fair value
through the current profit or loss
Including: investment in Ningbo Jianshe
Investment Company 1,140,915.04 1,140,915.04
Provision for impairment 1,140,915.04 1,140,915.04
Total - -
5.12 Fixed assets
5.12.1 Breakdown of fixed assets
Buildings and Machinery Transportation Other
Item Total
constructions equipment facilities equipment
I. Original
book value
1. Balance as
at January 1,
2022 102,695,978.18 627,433,921.06 6,068,851.89 19,676,929.41 755,875,680.54
2. Increase
in 2022 1,148,095.62 13,461,783.87 61,746.04 776,810.03 15,448,435.56
- Purchase 1,148,095.62 13,461,783.87 61,746.04 776,810.03 15,448,435.56
3. Decrease
in 2022 - 15,760,464.59 232,502.90 - 15,992,967.49
- Disposal or
scrapping - 15,760,464.59 232,502.90 - 15,992,967.49
4. Balance as
at December
31, 2022 103,844,073.80 625,135,240.34 5,898,095.03 20,453,739.44 755,331,148.61
II.
Accumulated
depreciation
1. Balance as
at January 1,
2022 54,137,550.62 449,376,981.60 5,235,853.68 17,955,642.53 526,706,028.43
2. Increase
in 2022 3,173,808.99 22,204,440.53 137,189.59 705,529.70 26,220,968.81
Provision in
2022 3,173,808.99 22,204,440.53 137,189.59 705,529.70 26,220,968.81
3. Decrease
in 2022 9,455,541.13 225,013.41 - 9,680,554.54
- Disposal or
scrapping 9,455,541.13 225,013.41 - 9,680,554.54
4. Balance as
at December
31, 2022 57,311,359.61 462,125,881.00 5,148,029.86 18,661,172.24 543,246,442.71
III. Provision
for
impairment
1. Balance as
at January 1,
2022 - 12,628,170.13 - - 12,628,170.13
2. Increase
in 2022
3. Decrease
in 2022 2,582,608.02 2,582,608.02
Notes to the Financial Statements Page58
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Buildings and Machinery Transportation Other
Item Total
constructions equipment facilities equipment
- Disposal or
scrapping 2,582,608.02 2,582,608.02
4. Balance as
at December
31, 2022 10,045,562.11 10,045,562.11
IV. Book
value
1. Book
value as at
December
31, 2022 46,532,714.19 152,963,797.23 750,065.17 1,792,567.21 202,039,143.80
2. Book
value as at
January 1,
2022 48,558,427.56 165,428,769.33 832,998.21 1,721,286.88 216,541,481.98
5.13 Construction in progress
5.13.1 Breakdown of construction in progress
Balance as at December 31, 2022 Balance as at January 1, 2022
Provision Provision
Item Book Book Book
for for Book value
balance value balance
impairment impairment
Science and
Technology
Complex
Project - - - 615,980.77 615,980.77
Production line
project 524,783.95 - 524,783.95 645,678.17 645,678.17
Mold to be
fixed 395,619.46 - 395,619.46 371,283.18 371,283.18
PDM system
upgrading
project - - - 53,935.55 53,935.55
Comprehensive
performance
test-bed 69,026.55 - 69,026.55 69,026.55 69,026.55
Workstation
project - - - 55,221.24 55,221.24
Total 989,429.96 - 989,429.96 1,811,125.46 - 1,811,125.46
5.14 Intangible assets
5.14.1 Intangible assets
Item Land use right Patent right Software Total
I. Original book value
1. Balance as at January
1, 2022 21,224,143.33 2,691,549.96 3,933,749.40 27,849,442.69
2. Increase in 2022
3. Decrease in 2022
4. Balance as at
December 31, 2022 21,224,143.33 2,691,549.96 3,933,749.40 27,849,442.69
II. Accumulated
amortization
1. Balance as at January
1, 2022 12,162,117.02 633,305.88 1,473,380.75 14,268,803.65
Notes to the Financial Statements Page59
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Item Land use right Patent right Software Total
2. Increase in 2022 701,418.80 474,979.41 602,735.88 1,779,134.09
Provision in 2022 701,418.80 474,979.41 602,735.88 1,779,134.09
3. Decrease in 2022
4. Balance as at
December 31, 2022 12,863,535.82 1,108,285.29 2,076,116.63 16,047,937.74
III. Provision for
impairment
1. Balance as at January
1, 2022
2. Increase in 2022
3. Decrease in 2022
4. Balance as at
December 31, 2022
IV. Book value
1. Book value as at
December 31, 2022 8,360,607.51 1,583,264.67 1,857,632.77 11,801,504.95
2. Book value as at
January 1, 2022 9,062,026.31 2,058,244.08 2,460,368.65 13,580,639.04
5.15 Long-term deferred expenses
Balance as at Balance as at
Increase in Amortization Other
Item January 1, December 31,
2022 in 2022 decreases
2022 2022
SlidDworks2018
three-year
service charges 116,978.77 - 46,698.12 - 70,280.65
Total 116,978.77 - 46,698.12 - 70,280.65
5.16 Deferred income tax assets and deferred income tax liabilities
5.16.1 Deferred income tax assets before offset
Balance as at December 31, 2022 Balance as at January 1, 2022
Deductible Deferred Deductible Deferred
Item
temporary income tax temporary income tax
differences assets differences assets
Losses from
credit impairment 33,873,448.97 5,073,630.93 34,862,886.80 5,229,979.37
Losses from asset
impairment 4,522,840.65 678,426.10 4,522,840.65 830,638.62
Total 38,396,289.62 5,752,057.03 39,385,727.45 6,060,617.99
5.16.2 Deferred income tax liabilities before offsetting
Balance as at December 31, 2022 Balance as at January 1, 2022
Taxable Deferred Taxable Deferred
Item
temporary income tax temporary income tax
differences liabilities differences liabilities
Asset evaluation
increment from
business
combination not
under common
control 3,281,012.83 820,253.21 4,682,036.67 1,170,509.17
Notes to the Financial Statements Page60
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at December 31, 2022 Balance as at January 1, 2022
Taxable Deferred Taxable Deferred
Item
temporary income tax temporary income tax
differences liabilities differences liabilities
One-time before-
tax deduction of
the depreciation
of fixed assets 1,276,898.41 191,534.76 1,411,238.58 352,809.65
Total 4,557,911.24 1,011,787.97 6,093,275.25 1,523,318.82
5.17 Other non-current assets
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Payment in advance for purchase of long-
term assets 15,860,120.00 3,810,800.00
Total 15,860,120.00 3,810,800.00
5.18 Short-term borrowings
5.18.1 Classification of short-term borrowings
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Credit borrowings 411,500,000.00 273,250,000.00
Guaranteed borrowings 135,103,500.00 220,210,000.00
Total 546,603,500.00 493,460,000.00
5.19 Notes payable
Balance as at Balance as at
Category
December 31, 2022 January 1, 2022
Bank acceptance bill 30,379,988.94 160,670,000.00
Commercial acceptance bills
Total 30,379,988.94 160,670,000.00
5.20 Accounts payable
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Within 1 year 167,925,916.80 186,738,613.09
1 - 2 years 1,002,926.50 1,219,209.52
2 - 3 years 936,903.59 530,450.87
Over 3 years 1,324,729.21 1,804,170.65
Total 171,190,476.10 190,292,444.13
5.21 Contract liabilities
5.21.1 Breakdown of contract liabilities
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Goods payment 3,441,205.38 2,868,604.98
Total 3,441,205.38 2,868,604.98
Notes to the Financial Statements Page61
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.22 Employee compensation payable
5.22.1 Presentation of employee compensation payable
Balance as at Balance as at
Increase in Decrease in
Item January December
2022 2022
1, 2022 31, 2022
Short-term
compensation 5,807,614.49 97,053,901.76 97,418,113.84 5,443,402.41
Post-employment
benefits - defined
contribution plans 3,019,024.94 10,746,282.54 10,679,317.11 3,085,990.37
-
Dismissal benefits 12,117,883.46 12,117,883.46 - -
Total 20,944,522.89 95,682,300.84 108,097,430.95 8,529,392.78
5.22.2 Presentation of short-term compensation
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2022 2022
2022 2022
Wages, bonuses,
allowances and
subsidies 2,953,489.88 72,968,782.48 73,657,754.48 2,264,517.88
Employee
welfare expenses - 4,751,825.24 4,751,825.24 -
Social insurance
premiums 1,249,255.33 9,879,846.72 9,895,326.25 1,233,775.80
Including:
medical
insurance
premiums 1,197,807.52 9,155,040.77 9,187,935.98 1,164,912.31
Work-related
injury insurance
premiums 51,447.81 724,805.95 707,390.27 68,863.49
Maternity
insurance
premiums
Housing
provident funds 350,718.46 7,725,545.00 7,599,126.00 477,137.46
Labor union
expenditures and
employee
education funds 1,059,150.82 1,727,902.32 1,319,081.87 1,467,971.27
Accumulated
short-term
compensated
absences
Short-term profit
(bonus) sharing
plan
Cash-settled
share-based
payment
Other short-term
compensation 195,000.00 - 195,000.00 -
Total 5,807,614.49 97,053,901.76 97,418,113.84 5,443,402.41
Notes to the Financial Statements Page62
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.22.3 Presentation of defined contribution plan
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2022 2022
2022 2022
Basic endowment
insurance 2,844,522.14 10,252,024.90 10,358,227.30 2,738,319.74
Unemployment
insurance
premium 174,502.80 494,257.64 321,089.81 347,670.63
Enterprise annuity
payment
Total 3,019,024.94 10,746,282.54 10,679,317.11 3,085,990.37
5.23 Taxes and surcharges payable
Balance as at Balance as at
Taxes and surcharges
December 31, 2022 January 1, 2022
Value-added tax 896,389.23
Individual income tax 969,485.81 455,942.81
Urban maintenance and construction tax 3,182,393.81 3,120,764.65
House property tax 3,727,900.64 3,727,900.64
Land use tax 1,808,215.20 1,808,215.20
Educational surtax 2,035,831.03 1,991,810.18
Others 4,029,488.35 4,029,488.35
Total 16,649,704.07 15,134,121.83
5.24 Other payables
Balance as at Balance as at
Nature
December 31, 2022 January 1, 2022
Deposit and security deposit 863,901.85 883,595.14
Employee-related expenses 3,806,031.38 182,224.40
Other current accounts 2,896,939.39 5,701,135.29
Total 7,566,872.62 6,766,954.83
5.25 Other current liabilities
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
Output tax to be carried forward 447,356.63 372,918.65
Total 447,356.63 372,918.65
5.26 Share capital
Changes in 2022 ("+" for increase and "-" for
decrease)
Balance as at Balance as at
Conversion
Item January 1, New December 31,
Share of capital
2022 shares Others Sub-total 2022
donation reserves into
issued
share capital
Total
shares 119,375,000.00 119,375,000.00
Notes to the Financial Statements Page63
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.27 Capital reserves
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2022 2022
2022 2022
Capital premium
(share 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
Notes to the Financial Statements Page64
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.28 Other comprehensive income
Year 2022
Less:
Less:
Less: financial
amount
amount assets Less:
previously
previously included in Less: carry-
Amou Amount included in
Balanc included in other hedging Amount forward of Balance
nt Less: after tax other
e as at other comprehensi reserves after tax changes in as at
before income attributabl comprehensi
Item Januar comprehensi ve income in transferr attributab re- Decemb
incom tax e to ve income
y 1, ve income prior period ed to le to the measureme er 31,
e tax expens minority and
2022 and and re- related parent nt of the 2022
in es shareholde currently
currently measured at assets or company defined
2022 rs transferred
transferred amortized liabilities benefit
to the
to the profit cost in the plan
retained
or loss current
earnings
period
I. Other
comprehensi
ve income
that cannot
be
reclassified
into profit or 9,800.0
loss 0 9,800.00
1. Other
comprehensi
ve income
that cannot
be
transferred
to profit or
loss under
the equity 9,800.0
method 0 9,800.00
II. Other
comprehensi
ve income
that will be
reclassified
into profit or
loss
Total of
other
comprehensi 9,800.0
ve income 0 9,800.00
Notes to the Financial Statements Page65
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.29 Special reserves
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2022 2022
2022 2022
Work safety expenses 1,713,882.50 2,673,873.52 1,153,086.99 3,234,669.03
Total 1,713,882.50 2,673,873.52 1,153,086.99 3,234,669.03
5.30 Surplus reserves
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2022 2022
2022 2022
Statutory surplus
reserves 56,724,000.00 56,724,000.00
Discretionary surplus
reserves 68,962,000.00 68,962,000.00
Total 125,686,000.00 - - 125,686,000.00
5.31 Undistributed profits
Item Year 2022 Year 2021
Undistributed profits at the end of prior period before - -
adjustment 1,056,046,383.95 1,030,047,421.23
Total adjustment to undistributed profits at the
beginning of the period ("+" for increase and "-" for
decrease)
Undistributed profits at the beginning of the period - -
after adjustment 1,056,046,383.95 1,030,047,421.23
Plus: net profit attributable to owners of the parent
company in the current period -39,733,094.69 -25,998,962.72
Less: withdrawal of statutory surplus reserves
Withdrawal of discretionary surplus reserves
Withdrawal of general risk reserves
Common stock dividends payable
Common stock dividends transferred to share capital
Plus: Surplus reserves offsetting losses
Carry-forward of changes in the defined benefit plan
for retained earnings
Carry-forward of other comprehensive income for
retained earnings
Internal carry-forward of owners' equity
- -
Undistributed profits at the end of the period 1,095,779,478.64 1,056,046,383.95
5.32 Operating revenue and operating cost
5.32.1 Operating revenue and operating cost
Year 2022 Year 2021
Item
Revenue Cost Revenue Cost
Primary business 470,261,936.64 448,590,807.18 663,904,859.33 573,770,883.14
Other business 3,852,161.44 1,804,628.12 16,214,107.75 13,130,939.66
Total 474,114,098.08 450,395,435.30 680,118,967.08 586,901,822.80
Notes to the Financial Statements Page66
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.32.2 Revenue from contracts
Item Year 2022 Year 2021
Domestic income 282,202,231.11 430,287,161.74
Overseas income 188,059,705.53 233,617,697.59
Total 470,261,936.64 663,904,859.33
5.33 Taxes and surcharges
Item Year 2022 Year 2021
Urban maintenance and construction tax 533,840.42 1,412,323.01
Educational surcharge 381,314.61 1,008,802.12
House property tax 860,544.46 1,982,928.97
Land use right 1,076,365.20 1,832,315.20
Stamp duty 323,275.85 453,795.40
Others 579,484.03 17,210.55
Total 3,754,824.57 6,707,375.25
5.34 Selling and distribution expenses
Item Year 2022 Year 2021
Employee compensation 6,827,653.20 7,229,332.62
Depreciation expenses 31,742.65 60,736.39
Office expenses 66,973.88 230,302.33
Advertising expenses - 184,158.41
Expenses for business trips 566,078.58 722,762.61
Handling charges for agency sale 199,885.56 177,584.81
Sales and service fees 157,067.52 555,856.21
Repair charge 5,629,736.77 5,439,785.83
Warehousing and custodian fees 1,000,193.68 1,546,418.12
Other fees 759,983.28 648,840.87
Total 15,239,315.12 16,795,778.20
5.35 General and administrative expenses
Item Year 2022 Year 2021
Employee compensation 26,516,905.13 31,007,429.20
Depreciation and amortization 5,117,551.67 10,036,582.19
Repair charge 4,416,563.67 9,505,068.66
Office expenses 714,345.12 811,164.13
Agency fee 912,850.26 865,439.58
Expenses for business trips 300,230.25 411,827.43
Membership fees of board of directors 392,640.06 427,465.56
Entertainment expenses 400,888.58 396,970.60
Insurance premiums and others 8,949,135.93 8,585,681.82
Total 47,721,110.67 62,047,629.17
5.36 Research and development expenses
Item Year 2022 Year 2021
Employee compensation 23,830,773.15 22,932,480.67
Materials expenses 760,693.67 1,650,738.65
Expenses for business trips 241,075.43 383,873.74
Depreciation expenses 2,143,128.61 2,278,310.53
Amortization of intangible assets 268,527.48 226,138.10
Others 3,354,670.35 2,289,231.77
Total 30,598,868.69 29,760,773.46
Notes to the Financial Statements Page67
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.37 Financial expenses
Item Year 2022 Year 2021
Interest expenses 20,216,911.43 24,231,685.81
Less: interest income 1,640,888.48 1,562,787.46
Gains or losses on foreign exchange 139,891.22 -21,267.77
Cash discount -1,314,322.50 -61,693.29
Bank charges and others 70,654.21 428,908.36
Total 17,472,245.88 23,014,845.65
5.38 Other income
5.38.1 Breakdown of investment income
Source of other income Year 2022 Year 2021
Government grants 205,826.00 1,583,305.16
Reduction or exemption of value-
added tax, residual insurance fund,
etc. 999,863.22
Total 1,205,689.22 1,583,305.16
5.38.2 Government grants included in other income
Asset-related/
Item Year 2022 Year 2021 Income-
related
Subsidy for technological
innovation and industrial Income-
application projects in 2021 80,000.00 related
District-level portion of major
new product research and Income-
development costs in 2020 24,100.00 related
Research and development Income-
investment subsidy in 2020 50,400.00 related
Subsidy for employment and Income-
talent center in Banan District 51,326.00 related
Income-
Subsidy for emergency supply 50,000.00 related
Income-
Funds granted for patents 58,200.00 related
Income-
Recruitment subsidy 8,400.00 related
Subsidy for Qianghua
scientific and technological Income-
projects 75,000.00 related
Special project funds for
technological innovation and Income-
application development 200,000.00 related
"Three Agency" handling Income-
charges 20,680.11 related
Subsidy for "Creating
Innovation Platform" in Banan Income-
District 300,000.00 related
Enterprise Subsidy Fund of
Banan District Commercial Income-
Committee 40,000.00 related
Notes to the Financial Statements Page68
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Asset-related/
Item Year 2022 Year 2021 Income-
related
Bonus of the Group's award- Income-
winning projects 50,000.00 related
Income-
Tax deduction and exemption 21,425.05 related
Subsidy for ecological Income-
environment 124,700.00 related
Subsidy for research and Income-
development 234,900.00 related
Incentives for steady growth Income-
of industrial enterprises 100,000.00 related
Special fund for
industrialization and Income-
informatization 300,000.00 related
Total 205,826.00 1,583,305.16
5.39 Investment income
5.39.1 Breakdown of investment income
Item Year 2022 Year 2021
Long-term equity
investment income under
the equity method 8,128,052.32 15,770,549.70
Total 8,128,052.32 15,770,549.70
5.40 Losses from credit impairment
Item Year 2022 Year 2021
Losses from bad debts 989,437.83 -318,331.09
Total 989,437.83 -318,331.09
5.41 Losses from asset impairment
Item Year 2022 Year 2021
Losses from inventory depreciation - 17,064.89
Total - 17,064.89
5.42 Gains from disposal of assets
Item Year 2022 Year 2021
Gains or losses from disposal of
non-current assets 40,420,431.93 1,566,473.14
Total 40,420,431.93 1,566,473.14
5.43 Non-operating revenue
Amount included in non-
Item Year 2022 Year 2021 recurring profit or loss in the
current period
Others 170,256.15 319,658.55 170,256.15
Total 170,256.15 319,658.55 170,256.15
5.44 Non-operating expenses
Notes to the Financial Statements Page69
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Amount included in non-
Item Year 2022 Year 2021 recurring profit or loss in the
current period
Others 3,112.43 198.18 3,112.43
Total 3,112.43 198.18 3,112.43
Notes to the Financial Statements Page70
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.45 Income tax expenses
5.45.1 Table of income tax expenses
Item Year 2022 Year 2021
Current income tax expenses -220,882.55
Deferred income tax
expenses -202,969.89 -171,772.56
Total -423,852.44 -171,772.56
5.45.2 Adjustment process of accounting profit and income tax expenses
Item Year 2022
Total profits -40,156,947.13
Income tax expenses calculated at the statutory [or
applicable] tax rate -10,039,236.78
Effect of different tax rates applicable to subsidiaries 5,736,627.39
Effect of adjustments to the income tax for the prior years -220,882.55
Effect of non-taxable income -2,032,013.08
Effect of non-deductible costs, expenses and losses 35,607.77
Effect of deductible losses from using the deferred
income tax assets unrecognized in prior periods -3,285,732.64
Effect of deductible temporary differences or losses from
deferred income tax assets unrecognized in the current
period 12,807,589.43
Others -3,425,811.98
Income tax expenses -423,852.44
5.46 Notes to the statement of cash flows
5.46.1 Cash received from other operating activities
Item Year 2022 Year 2021
Interest income 1,640,888.48 1,113,277.82
Government grants 205,826.00 1,583,305.16
Margin and deposit etc. 10,527,527.06 7,145,658.84
Total 12,374,241.54 9,842,241.82
5.46.2 Cash paid for other operating activities
Item Year 2022 Year 2021
Expenses from cash
payment in the period 10,673,279.12 23,270,903.78
Margin and deposit etc. 11,305,170.76 1,255,698.63
Total 21,978,449.88 24,526,602.41
5.46.3 Cash received from other financing activities
Item Year 2022 Year 2021
Bills, deposits and other
related funds received 81,688,328.08 43,814,318.47
Total 81,688,328.08 43,814,318.47
5.46.4 Cash paid for other investing activities
Item Year 2022 Year 2021
Bills, deposits and other
related funds paid 108,137,271.47 25,795,639.32
Total 108,137,271.47 25,795,639.32
Notes to the Financial Statements Page71
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.47 Supplementary information to the statement of cash flows
5.47.1 Supplementary information to the statement of cash flows
Item Year 2022 Year 2021
1. Net profit adjusted to cash flows from
operating activities
Net profit -39,733,094.69 -25,998,962.72
Plus: losses from credit impairment -989,437.83 318,331.09
Provision for asset impairment - -17,064.89
Depreciation of fixed assets, oil and gas
assets and productive biological assets 26,220,968.81 33,781,956.81
Depreciation of right-of-use assets
Amortization of intangible assets 1,779,134.09 2,109,555.59
Amortization of long-term deferred
expenses 46,698.12 47,865.57
Losses from disposal of fixed assets,
intangible assets and other long-term
assets ("-" for gains) -40,420,431.93 -1,566,473.14
Losses from write-off of fixed assets ("-"
for gains) 169.23
Losses from changes in fair value ("-"
for gains)
Financial expenses ("-" for gains) 20,216,911.43 24,231,685.81
Investment loss ("-" for income) -8,128,052.32 -15,770,549.70
Decreases in deferred income tax assets
("-" for increases) 308,560.96 213,460.13
Increases in deferred income tax
liabilities ("-" for decreases) -511,530.85 -385,232.69
Decreases in inventories ("-" for
increases) 74,859,032.86 -37,573,619.01
Decreases in operating receivables ("-"
for increases) 48,007,274.99 2,091,660.99
Increases in operating payables ("-" for
decreases) -69,246,434.55 39,949,584.40
Others
Net cash flows from operating activities 12,409,599.09 21,432,367.47
2. Significant investing and financing
activities not involving cash receipts and
payments
Conversion of debt into capital
Convertible corporate bonds maturing
within one year
New right-of-use assets
3. Net changes in cash and cash
equivalents
Ending balance of cash 169,994,534.05 23,738,523.19
Less: beginning balance of cash 23,738,523.19 79,310,253.55
Plus: ending balance of cash equivalents -
Less: beginning balance of cash
equivalents -
Net increase in cash and cash equivalents 146,256,010.86 -55,571,730.36
Notes to the Financial Statements Page72
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
5.47.2 Breakdown of cash and cash equivalents
Balance as at Balance as at
Item
December 31, 2022 January 1, 2022
I. Cash 169,994,534.05 23,738,523.19
Including: cash on hand -
Unrestricted bank deposit 169,994,534.05 23,738,523.19
Other unrestricted monetary funds
II. Cash equivalents
Including: bond investments maturing
within three months
III. Ending balance of cash and cash
equivalents 169,994,534.05 23,738,523.19
Including: cash and cash equivalents
restricted for use by the parent company or
subsidiaries of the group
5.48 Assets with restrictions on the ownership or use right
Item Balance Reason for restriction
Monetary funds 9,959,988.94 Margin of bank acceptance bills
Receivables financing 7,820,000.00 Pledge
Total 17,779,988.94
5.49 Government grants
1. Basic information on government grants
Category of government Amount included in the
Year 2022 Remark
grants current profit or loss
Government grants See the Note
included in other income 205,826.00 205,826.00 5.38 for details
Total 205,826.00 205,826.00
6 Changes in the consolidation scope
There was no change in the consolidation scope of the Company during the reporting period.
7 Rights and interests in other entities
7.1 Equity in the subsidiaries
7.1.1 Structure of the enterprise group
Principal Business Shareholding
Name of Registered Acquisition
place of nature ratio (%)
subsidiaries place method
business Direct Indirect
Chongqing Production
Jianshe and sales of
Automobile automobile
A/C Co., air Establishment
Ltd. Chongqing Chongqing conditioners 100.00 by investment
Chongqing
Pingshan Production Combination
TK and sales of not under
Carburetor motorcycle common
Co., Ltd. Chongqing Chongqing accessories 100.00 control
Notes to the Financial Statements Page73
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
7.2 Equity in joint venture arrangements or associates
7.2.1 Significant joint ventures or associates
Name of Shareholding
Principal Business Method for
joint Registered ratio (%)
place of nature accounting
venture or place
business Direct Indirect treatment
associate
Assembly of
variable
Chongqing displacement
Hanon compressor
Jianshe and
Thermal production
Systems of core Equity
Co., Ltd. Chongqing Chongqing components 50.00 method
7.2.2 Major financial information on significant joint ventures
Chongqing Hanon Jianshe Thermal Systems
Co., Ltd.
Item
Balance as at December Balance as at January
31, 2022 / Year 2022 1, 2022/ Year 2021
Current assets 166,787,138.08 172,069,804.29
Including: cash and cash
equivalents 55,135,317.36 52,373,714.91
Non-current assets 355,276,389.82 380,490,597.33
Total assets 522,063,527.90 552,560,401.62
Current liabilities 95,641,912.16 90,246,513.99
Non-current liabilities 9,313,692.45 61,462,068.98
Total liabilities 104,955,604.61 151,708,582.97
Minority equity
Equity attributable to the
shareholders of parent company 417,107,923.29 400,851,818.65
Share of net assets calculated at the
shareholding ratio 208,553,961.65 200,425,909.33
Adjusted items
- Goodwill
- Unrealized profits of internal
transactions
- Others
Book value of the equity
investment in joint ventures 210,112,321.04 201,984,268.72
Fair value of equity investment
with public offer
Operating revenue 254,562,100.17 306,636,095.98
Financial expenses 4,586,867.43 8,227,807.42
Income tax expenses 1,799,442.01
Net profit 16,256,104.64 31,541,099.39
Net profit of discontinued
operation
Other comprehensive income
Total comprehensive income 16,256,104.64 31,541,099.39
Dividends received from joint
ventures in current period
Notes to the Financial Statements Page74
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
8 Related parties and related transactions
8.1 Parent company of the Company
Registered Shareholding Voting
Registered Business capital ratio in the ratio in the
Parent company
place nature (RMB Company Company
0'000) (%) (%)
China South State-owned
Industries Group assets
Corporation Beijing investment 3,530,000.00 71.13 71.13
8.2 See the Note 7.1"Equity in subsidiaries" for details about the Company's subsidiaries
8.3 Joint ventures and associates of the Company
See the Note 7.2 "Equity in joint venture arrangement or associates" for details about major
joint ventures and associates of the Company.
8.4 Other related parties
Other related party Relationship with the Company
Chongqing Jianshe Mechanical & Electrical
Equipment Co., Ltd. Controlled by the same party
Chongqing Jianshe Industry (Group) Co., Ltd. Controlled by the same party
China South Industries Group Finance Co., Ltd. Controlled by the same party
Chongqing Changan Automobile Co., Ltd. Controlled by the same party
Beijing Changan Automobile Company under
Chongqing Changan Automobile Co., Ltd. Controlled by the same party
Chongqing Lingyao Automobile Co., Ltd. Joint venture of subsidiaries of CSGC
Hebei Changan Automobile Co., Ltd. Controlled by the same party
Nanjing Changan Automobile Co., Ltd. Controlled by the same party
Baoding Changan Bus Manufacturing Co., Ltd. Controlled by the same party
Hefei Changan Automobile Co., Ltd. Controlled by the same party
Chongqing Changan Automobile Customer
Service Co., Ltd. Controlled by the same party
Chongqing North Jianshe IMP. & EXP. Trade
Co., Ltd. Controlled by the same party
Hafei Motor Co., Ltd. Controlled by the same party
South Air International Conditioning Co., Ltd. Controlled by the same party
Southwest Ordnance Chongqing Environmental
Protection Research Institute Co., Ltd. Controlled by the same party
China Ordnance Equipment Group Commercial
Factoring Co., Ltd. Controlled by the same party
Chongqing Jianshe Yamaha Motorcycle Co., Ltd. Joint venture of subsidiaries of CSGC
Changan Minsheng APLL Logistics Co., Ltd. Joint venture of subsidiaries of CSGC
Chongqing Jianshe Lijue Industrial Co., Ltd. Associates of subsidiaries of CSGC
Changan Minsheng APLL Logistics Co., Ltd.
and its affiliates Controlled by the same party
Chongqing Changan Automobile Co., Ltd. and
its affiliates Controlled by the same party
Luoyang North Enterprises Group Co., Ltd. Controlled by the same party
Norendar International Co., Ltd. Controlled by the same party
Zhuzhou Jianshe Yamaha Motorcycle Co., Ltd. Associates of subsidiaries of CSGC
Yan Xuechuan Chairman
Fan Aijun Director and General Manager
Notes to the Financial Statements Page75
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Other related party Relationship with the Company
Secretary of the Discipline Inspection
Xu Wanming Commission
Dong Qihong Director
Shi Qinggong Director
Zhou Yongqiang Deputy General Manager
Hao Ling Director
Li Jiaming Independent Director
Xie Fei Independent Director
Song Weiwei Independent Director
Liu Wei Independent Director
Lu Xianyun Chairman of the Board of Supervisors
Zhang Lungang Supervisor
Qiao Guoan Supervisor
Liao Jian Employee Supervisors
Su Qiang Employee Supervisors
Deputy General Manager (resigned on 23
Yu Wenbiao May 2022)
Tan Mingxian Chief Accountant
Li Yongjiang Deputy General Manager
Zhang Hushan Secretary of the Board of Directors
8.5 Related transactions
8.5.1 For the subsidiaries under the control of the Company and included in the scope
of consolidated financial statements, their mutual transactions and the parent-
subsidiary corporation transactions have already been offset.
8.5.2 Related transactions on purchase of goods and receiving of services
Contents of related
Related-party Year 2022 Year 2021
transaction
Chongqing Jianshe
Industry (Group) Co., Inspection of parts
Ltd. and accessories 441,640.30 699,441.80
Changan Minsheng
APLL Logistics Co.,
Ltd. and its affiliated
enterprises Warehousing services 448,659.50 3,735,472.46
Southwest Ordnance
Chongqing
Environmental
Protection Research Inspection of parts
Institute Co., Ltd. and accessories 1,512,267.38 1,736,605.88
Chongqing Jianshe
Industry (Group) Co.,
Ltd. Materials 837,856.39 1,567,203.06
Chongqing Changan
Automobile Co., Ltd.
and its affiliated
enterprises Maintenance 841,944.49 1,163,939.02
Total 4,082,368.06 8,902,662.22
Notes to the Financial Statements Page76
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
8.5.3 Related transactions on sale of goods and rendering of services
Contents of related
Related party Year 2022 Year 2021
transaction
Chongqing Changan Auto and parts and
Automobile Co., Ltd. accessories 43,720,572.99 131,973,718.97
Chongqing Lingyao Auto and parts and
Automobile Co., Ltd. accessories 4,636,556.72 5,615,743.47
Hefei Changan Auto and parts and
Automobile Co., Ltd. accessories 11,134,628.84 16,194,939.56
Nanjing Changan Auto and parts and
Automobile Co., Ltd. accessories 2,161,621.42 1,820,143.06
Baoding Changan Bus
Manufacturing Co., Auto and parts and
Ltd. accessories 150,622.08 1,324,434.08
Hebei Changan Auto and parts and
Automobile Co., Ltd. accessories 121,469.92
Chongqing Changan
Automobile Customer Auto and parts and
Service Co., Ltd. accessories 6,851.20
South Air International Auto and parts and
Co., Ltd. accessories 144,000.00
Chongqing Jianshe
Yamaha Motorcycle
Co., Ltd. Motorcycle parts 12,974,854.46 11,944,592.17
Chongqing Jianshe
Industry (Group) Co.,
Ltd. Materials 21,617.53 427,878.59
Chongqing Jianshe
Mechanical &
Electrical Equipment
Co., Ltd. Materials 88,671.74 207,747.94
Chongqing Hanon
Jianshe Thermal
Systems Co., Ltd. Materials 15,848.42 4,829,474.48
Chongqing Hanon
Jianshe Thermal Auto parts and
Systems Co., Ltd. accessories 1,780,532.11 9,339,577.80
Total 76,806,996.23 183,829,101.32
8.5.4 Remuneration of key senior officers
Item Year 2022 Year 2021
Remuneration of key senior officers 3,780,412.68 3,574,756.20
8.5.5 Other related-party transactions
(1) Related-party deposits
Balance as at Balance as at
Name of related
January 1, Increase in 2022 Decrease in 2022 December 31,
parties
2022 2022
China South
Industries Group
Finance Co., Ltd 67,084,183.76 1,668,030,973.74 1,568,218,555.93 166,896,601.57
Remark: the interest of related-party deposits received in 2022 totaled RMB
Notes to the Financial Statements Page77
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
1,129,480.52.
(2) Related-party loans
Annual Balance as at
Name of related Ending
Start date interest Guarantor December
parties date
rate 31, 2022
China South
Industries Group
Finance Co., Ltd 2022/1/13 2023/1/13 4.35% None 17,500,000.00
China South
Industries Group
Finance Co., Ltd 2022/1/13 2023/1/13 4.35% None 17,710,000.00
China South
Industries Group
Finance Co., Ltd 2022/6/21 2023/6/21 3.92% None 20,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/7/12 2023/7/12 4.35% None 30,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/7/18 2023/7/18 4.35% None 10,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/9/6 2023/9/6 4.35% None 15,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/9/8 2023/9/8 4.35% None 15,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/9/13 2023/9/13 4.35% None 20,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/10/24 2023/10/24 4.35% None 10,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/10/26 2023/10/26 4.35% None 58,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/10/26 2023/10/26 4.35% None 30,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/10/28 2023/10/28 4.35% None 60,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/10/28 2023/10/28 4.35% None 19,290,000.00
China South
Industries Group
Finance Co., Ltd 2022/12/26 2023/12/26 3.92% None 18,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/12/27 2023/12/27 3.92% None 32,000,000.00
China South
Industries Group
Finance Co., Ltd 2022/12/28 2023/3/28 4.35% None 39,000,000.00
Notes to the Financial Statements Page78
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
8.6 Receivables from and payables to related parties
(1) Receivables from related parties
Balance as at December 31, Balance as at January 1,
2022 2022
Item name Related party
Provision for Provision for
Book balance Book balance
bad debts bad debts
Accounts
receivable
Chongqing
Changan
Automobile Co.,
Ltd. 7,072,474.53 - 15,225,677.65 -
Hafei Motor
Co., Ltd. 3,999,944.43 3,999,944.43 3,999,944.43 3,999,944.43
Hefei Changan
Automobile Co.,
Ltd. 2,846,630.18 - 4,584,439.91 -
Chongqing
Hanon Jianshe
Thermal
Systems Co.,
Ltd. 2,290,479.22 - 2,062,836.40 -
Chongqing
Jianshe Yamaha
Motorcycle Co.,
Ltd. 769,838.66 - 978,730.60 -
Hebei Changan
Automobile Co.,
Ltd. 189,172.54 22,436.51 51,911.53 -
Nanjing
Changan
Automobile Co.,
Ltd. 132,101.39 - 779,950.94 -
Chongqing
Lingyao
Automobile Co.,
Ltd. 413,084.63 -
Baoding
Changan Bus
Manufacturing
Co., Ltd. 178,907.37 -
Chongqing
Changan
Automobile
Customer
Service Co.,
Ltd. 3,870.93 -
Notes
receivable
Chongqing
Changan
Automobile Co.,
Ltd. 5,340,000.00
Notes to the Financial Statements Page79
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at December 31, Balance as at January 1,
2022 2022
Item name Related party
Provision for Provision for
Book balance Book balance
bad debts bad debts
Hefei Changan
Automobile Co.,
Ltd. 1,781,515.49
Nanjing
Changan
Automobile Co.,
Ltd. 200,000.00
Receivables
financing
Chongqing
Changan
Automobile Co.,
Ltd. 12,320,000.00
Chongqing
Jianshe Yamaha
Motorcycle Co.,
Ltd. 267,000.00
Other
receivables
Chongqing
Jianshe Lijue
Industrial Co.,
Ltd. 1,478,870.07 1,478,870.07 1,478,870.07 1,478,870.07
Chongqing
Jianshe Industry
(Group) Co.,
Ltd. 1,294,150.66 -
(2) Payables to related parties
Balance as at Balance as at
Item name Related party
December 31, 2022 January 1, 2022
Accounts
payable
China Ordnance
Equipment Group
Commercial Factoring
Co., Ltd. 18,250,000.00 23,610,000.00
Chongqing Hanon
Jianshe Thermal
Systems Co., Ltd. 526,575.70 497,923.20
Chongqing Jianshe
Yamaha Motorcycle
Co., Ltd. 23,210.00 23210
Changan Minsheng
APLL Logistics Co.,
Ltd. 20,895.96
Notes
payable
Notes to the Financial Statements Page80
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at Balance as at
Item name Related party
December 31, 2022 January 1, 2022
China South Industries
Group Finance Co., Ltd 14,000,000.00 75,800,000.00
Other
payables
Chongqing Jianshe
Industry (Group) Co.,
Ltd. 341,525.92 233,241.12
Luoyang North
Enterprises Group Co.,
Ltd. 142,730.00
Southwest Ordnance
Chongqing
Environmental
Protection Research
Institute Co., Ltd. 100,000.00
Chongqing Jianshe
Lijue Industrial Co.,
Ltd. 57,200.00
Norendar International
Co., Ltd. 25,000.00
Chongqing Hanon
Jianshe Thermal
Systems Co., Ltd. 20,470.00
Contract
liabilities
Chongqing Lingyao
Automobile Co., Ltd. 223,940.62
Chongqing Hanon
Jianshe Thermal
Systems Co., Ltd. 14,617.55
Chongqing Changan
Automobile Co., Ltd.,
Changan Automobile
(Beijing) Company 2,799.75
Chongqing North
Jianshe IMP. & EXP.
Trade Co., Ltd. 698.20 788.97
Zhuzhou Jianshe
Yamaha Motorcycle
Co., Ltd. 553.11 625.01
9 Commitments and contingencies
9.1 Significant commitments
The Company has no significant commitments to be disclosed.
9.2 Significant contingencies existing on balance sheet date
The Company has no significant contingencies required to be disclosed.
10 Post balance sheet events
As at the reporting date of financial report, the Company has no major post balance sheet events
required to be disclosed.
Notes to the Financial Statements Page81
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
11 Other significant events
11.1 Segment information
The Company has a single business, mainly the manufacture and sale of automotive air
conditioners and their parts and carburetors, and the repair of automotive air conditioners and
their parts. The management manages this business as a whole and evaluates the operating
results, therefore, no segment information is presented in the financial statements.
12 Notes to main items of financial statements of the parent company
12.1 Accounts receivable
12.1.1 Accounts receivable disclosed by aging
Balance as at Balance as at
Aging
December 31, 2022 January 1, 2022
1 - 6 months (inclusive) 3,266,890.00 3,152,475.45
6 months - 1 year - -
1 - 3 years - -
2 - 3 years - -
3 - 4 years - -
4 - 5 years - -
Over 5 years 1,291,496.94 1,291,496.94
Sub-total 4,558,386.94 4,443,972.39
Less: provision for bad debts 1,291,496.94 1,291,496.94
Total 3,266,890.00 3,152,475.45
12.1.2 Disclosure under the methods of provision for bad debts by category
Balance as at December 31, 2022
Book balance Provision for bad debts
Proportion Proportion of Book value
Amount Amount
Category (%) provision (%)
Accounts
receivable
with provision
for bad debts
accrued on an
individual
basis
Accounts
receivable
with provision
for bad debts
accrued on a
portfolio basis 4,558,386.94 100.00 1,291,496.94 28.33 3,266,890.00
Including:
Portfolio 1
Consolidated
related parties
Portfolio 2
Aging
portfolio 4,558,386.94 100.00 1,291,496.94 28.33 3,266,890.00
Total 4,558,386.94 100.00 1,291,496.94 28.33 3,266,890.00
Notes to the Financial Statements Page82
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Continued:
Balance as at January 1, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Accounts
receivable
with provision
for bad debts
accrued on an
individual
basis
Accounts
receivable
with provision
for bad debts
accrued on a
portfolio basis 4,443,972.39 100.00 1,291,496.94 29.06 3,152,475.45
Including:
Portfolio 1
Consolidated
related parties
Portfolio 2
Aging
portfolio 4,443,972.39 100.00 1,291,496.94 29.06 3,152,475.45
Total 4,443,972.39 100.00 1,291,496.94 29.06 3,152,475.45
12.1.3 Accounts receivable with provision for bad debts accrued on a portfolio basis
(1) Portfolio 2 Aging portfolio
Balance as at December 31, 2022
Aging Book Provision for Proportion of
balance bad debts provision (%)
1 - 6 months (inclusive) 3,266,890.00 - -
6 months - 1 year
1 - 2 years
2 - 3 years
3 - 4 years
4 - 5 years
Over 5 years 1,291,496.94 1,291,496.94 100.00
Total 4,558,386.94 1,291,496.94 28.33
12.1.4 Provision, reversal or recovery of provision for bad debts in 2022
Balance as at Changes in 2022 Balance as at
Category January 1, Recovery Other December 31,
Provision Charge-off
2022 or reversal changes 2022
Accounts
receivable
with
provision for
bad debts
accrued on
an individual
basis
Notes to the Financial Statements Page83
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at Changes in 2022 Balance as at
Category January 1, Recovery Other December 31,
Provision Charge-off
2022 or reversal changes 2022
Accounts
receivable
with
provision for
bad debts
accrued on a
portfolio
basis 1,291,496.94 - - 1,291,496.94
Including:
Portfolio 1
Consolidated
related
parties
Portfolio 2
Aging
portfolio 1,291,496.94 - - 1,291,496.94
Total 1,291,496.94 - - 1,291,496.94
12.1.5 No actual charge-off of accounts receivable in 2022
6. Top 5 of accounts receivable as at December 31, 2022, presented by debtor
Balance as at Proportion in the ending
Provision for
Enterprise name December 31, balance of accounts
bad debts
2022 receivable (%)
Chongqing Hanon Jianshe
Thermal Systems Co., Ltd. 2,290,479.22 50.25 -
Chongqing Jianshe Yamaha
Motorcycle Co., Ltd. 769,838.66 16.89 -
Wuhan Longchang Company
Wujiao Marketing Department 473,539.96 10.39 473,539.96
Changzheng Machinery Factory
of China Aerospace Science and
Technology Corporation 395,296.04 8.67 395,296.04
Chongqing Chihai Machinery
Manufacturing Co., Ltd. 145,999.35 3.20 145,999.35
Total 4,075,153.23 89.40 1,014,835.35
12.2 Other receivables
12.2.1 Disclosure of other receivables by aging
Balance as at Balance as at
Aging
December 31, 2022 January 1, 2022
1 - 6 months (inclusive) 1,345,740.08 1,153,592.45
6 months - 1 year -
1 - 2 years - 1,223,146.45
2 - 3 years 1,223,146.45 255,723.62
3 - 4 years 255,723.62
4 - 5 years -
Over 5 years 4,203,627.25 4,203,627.25
Sub-total 7,028,237.40 6,836,089.77
Less: provision for bad debts 5,682,497.32 5,682,497.32
Notes to the Financial Statements Page84
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at Balance as at
Aging
December 31, 2022 January 1, 2022
Total 1,345,740.08 1,153,592.45
12.2.2 Classification by nature
Book balance as at Book balance as at
Nature
December 31, 2022 January 1, 2022
Petty cash, security deposit and
advances of employee social insurance
premium 51,589.42
Current accounts 6,976,647.98 6,836,089.77
Total 7,028,237.40 6,836,089.77
12.2.3 Disclosure of three-stage by impairment of financial assets
Balance as at December 31, 2022 Balance as at January 1, 2022
Item Book Provision for Book Provision for
Book value Book value
balance bad debts balance bad debts
Stage I 5,067,613.24 3,721,873.16 1,345,740.08 5,041,699.86 3,888,107.41 1,153,592.45
Stage II - - - - - -
Stage
III 1,960,624.16 1,960,624.16 - 1,794,389.91 1,794,389.91 -
Total 7,028,237.40 5,682,497.32 1,345,740.08 6,836,089.77 5,682,497.32 1,153,592.45
12.2.4 Disclosure under the methods of provision for bad debts by category
Balance as at December 31, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables
with provision for
bad debts accrued
on an individual
basis 1,960,624.16 27.90 1,960,624.16 100.00 -
Other receivables
with provision for
bad debts accrued
on a portfolio basis 5,067,613.24 72.10 3,721,873.16 73.44 1,345,740.08
Including: Portfolio
1 Consolidated
related parties
Portfolio 2 Aging
portfolio 5,067,613.24 72.10 3,721,873.16 73.44 1,345,740.08
Total 7,028,237.40 100.00 5,682,497.32 80.85 1,345,740.08
Continued:
Balance as at January 1, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables
with provision for
bad debts accrued
on an individual
basis 1,794,389.91 26.25 1,794,389.91 100.00 -
Notes to the Financial Statements Page85
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Balance as at January 1, 2022
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables
with provision for
bad debts made by
portfolio 5,041,699.86 73.75 3,888,107.41 77.12 1,153,592.45
Including:
Portfolio 1
Consolidated
related parties
Portfolio 2 Aging
portfolio 5,041,699.86 73.75 3,888,107.41 77.12 1,153,592.45
Total 6,836,089.77 100.00 5,682,497.32 83.13 1,153,592.45
12.2.5 Other receivables with provision for bad debts accrued on an individual basis
Balance as at December 31, 2022
Enterprise name Book Provision for Proportion of Reason for
balance bad debts provision (%) provision
Chongqing Jianshe
Lijue Industrial Expected to be
Co., Ltd. 1,478,870.07 1,478,870.07 100.00 irrecoverable
Ningbo Jianshe
Motorcycle Co. Expected to be
Ltd. 329,628.73 329,628.73 100.00 irrecoverable
Chongqing
Jinxiang Lifting
Equipment
Manufacturing Expected to be
Co., Ltd. 16,800.00 16,800.00 100.00 irrecoverable
Yangzhou
Qionghua Coating
Engineering
Equipment Co., Expected to be
Ltd. 56,500.00 56,500.00 100.00 irrecoverable
Chongqing Expected to be
Customs 78,825.36 78,825.36 100.00 irrecoverable
Total 1,960,624.16 1,960,624.16
12.2.6 Other receivables with provision for bad debts accrued on a portfolio basis
(1) Portfolio 2 Aging portfolio
Balance as at December 31, 2022
Aging Book Provision for Proportion of
balance bad debts provision (%)
1 - 6 months (inclusive) 1,345,740.08 - -
6 months - 1 year
1 - 2 years
2 - 3 years
3 - 4 years
4 - 5 years
Over 5 years 3,721,873.16 3,721,873.16 100.00
Total 5,067,613.24 3,721,873.16 73.44
Notes to the Financial Statements Page86
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
12.2.7 Provision for bad debts of other receivables
Stage I Stage II Stage III
Expected Expected
credit loss in credit loss in
Provision for bad 12-month
the whole the whole Total
debts expected
duration duration
credit loss
(without credit (with credit
impairment) impairment)
Balance as at January
1, 2022 3,888,107.41 - 1,794,389.91 5,682,497.32
In 2022, balance as at
January 1, 2022 -
-Transfer to Stage II -
-Transfer to Stage III -
-Reversal from Stage
II -
-Reversal from Stage I -
Provision in 2022 - 166,234.25 166,234.25
Reversal in 2022 166,234.25 - 166,234.25
Write-off in 2022 -
Charge-off in 2022 -
Other changes -
Balance as at
December 31, 2022 3,721,873.16 - 1,960,624.16 5,682,497.32
12.2.8 No actual charge-off of other receivables in 2022
12.2.9 Top 5 of other receivables as at December 31, 2022, presented by debtor
Proportion in Provision for
Balance as at the ending bad debts
Nature of
Name of entity December 31, Aging balance of Balance as at
payment
2022 other December 31,
receivables (%) 2022
Shenzhen
Jianshe
Motorcycle Current
Co., Ltd. accounts 3,013,664.00 Over 5 years 42.88 3,013,664.00
Chongqing
Jianshe Lijue
Industrial Co., Current
Ltd. accounts 1,478,870.07 2 -4 years 21.04 1,478,870.07
Chongqing
Jianshe
Industry
(Group) Co., Current 1 - 6 months
Ltd. accounts 1,294,150.66 (inclusive) 18.41 -
Ningbo Jianshe
Chongqing Current
Office accounts 692,035.31 Over 5 years 9.85 692,035.31
Ningbo Jianshe
Motorcycle Current
Co., Ltd. accounts 329,628.73 Over 5 years 4.69 329,628.73
Total 6,808,348.77 96.87 5,514,198.11
Notes to the Financial Statements Page87
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
12.3 Long- term equity investments
Balance as at December 31, 2022 Balance as at January 1, 2022
Provision Book value Provision Book value
Nature
Book balance for Book balance for
impairment impairment
Investment in
subsidiaries 199,045,443.95 - 199,045,443.95 199,045,443.95 199,045,443.95
Investments in
associates and
joint ventures 210,112,321.04 - 210,112,321.04 201,984,268.72 201,984,268.72
Total 409,157,764.99 - 409,157,764.99 401,029,712.67 - 401,029,712.67
12.3.1 Investments in subsidiaries
Balance of
provision
Provision
Initial Balance as at Balance as at for
Increase Decrease for
Investee Investment January 1, December 31, impairment
in 2022 in 2022 impairment
cost 2022 2022 as at
in 2022
December
31, 2022
Chongqing
Jianshe
Automobile
A/C Co., Ltd. 160,000,000.00 160,000,000.00 160,000,000.00
Chongqing
Pingshan TK
Carburetor
Co., Ltd. 39,045,443.95 39,045,443.95 39,045,443.95
Total 199,045,443.95 199,045,443.95 199,045,443.95
12.3.2 Investments in associates and joint ventures
Increase or decrease in 2022
Profit or loss
Balance as at on Adjustment to
Investee January 1, Additional Reduced investments other
2022 investment investment recognized comprehensive
by the equity income
method
I. Joint venture
Chongqing Hanon
Jianshe Thermal 201,984,268.72 8,128,052.32
Systems Co., Ltd.
Total 201,984,268.72 8,128,052.32
Continued:
Increase/decrease in 2022 Balance of
Cash provision
Other dividends Balance as at for
Provision
Investee changes or profits December 31, impairment
for Others
in declared 2022 as at
impairment
equities to be December
distributed 31, 2022
I. Joint venture
Chongqing Hanon
Jianshe Thermal
Systems Co., Ltd. 210,112,321.04
Notes to the Financial Statements Page88
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Increase/decrease in 2022 Balance of
Cash provision
Other dividends Balance as at for
Provision
Investee changes or profits December 31, impairment
for Others
in declared 2022 as at
impairment
equities to be December
distributed 31, 2022
Total 210,112,321.04
12.4 Operating revenue and operating costs
12.4.1 Operating revenue and operating costs
Year 2022 Year 2021
Item
Revenue Costs Revenue Costs
Primary
business 255,276,559.90 259,099,923.72 493,566,986.58 499,200,539.40
Other
business 474,716.54 12,774.84 11,820,268.31 10,319,273.71
Total 255,751,276.44 259,112,698.56 505,387,254.89 509,519,813.11
12.4.2 Revenue generated from contracts
Item Year 2022 Year 2021
Domestic revenue 255,276,559.90 493,566,986.58
Overseas revenue
Total 255,276,559.90 493,566,986.58
12.5 Investment income
Item Year 2022 Year 2021
Income from long-term equity
investments calculated under the
equity method 8,128,052.32 15,770,549.70
Total 8,128,052.32 15,770,549.70
13 Supplementary information
13.1 Breakdown of non-recurring profit or loss in 2022
Item Amount Remark
Profit or loss from disposal of non-current assets 40,420,431.93
Tax return or relief under unauthorized approval or
without official approval document
Government grants included in current profits or
losses (except for government grants closely related
to the enterprise business, obtained by quota or
quantity at unified state standards) 205,826.00
Expenses for using funds charged from non-financial
enterprises and included in the current profit or loss -
Gains from the difference between the investment
costs of acquisition of subsidiaries, associates and
joint ventures and share in the net fair value of the
identifiable assets of the investee when investing -
Profit or loss from exchange of non-monetary assets -
Profit or loss from entrusting others to invest in or
manage assets -
Provisions for impairment of various assets due to any
force majeure, such as the natural disaster -
Notes to the Financial Statements Page89
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Item Amount Remark
Profits or losses from debt restructuring -
Enterprise restructuring expenses, such as employee
accommodation costs and integration expenses -
Profit or loss from the part generating in the
transaction where the transaction price is not fair and
exceeding the fair value -
Net profit or loss of the subsidiary from the business
combination under common control for the period
from the beginning of the period to the combination
date -
Profit or loss from contingencies irrelevant to the
company's normal business -
Profit or loss on changes in fair values of financial
assets held for trading and financial liabilities held for
trading and investment income obtained from disposal
of financial assets held for trading, financial liabilities
held for trading, creditor's right investment and other
creditor's rights investment, except for effective
hedging operations associated with the company's
normal operations -
Reversal of provision for impairment of receivables
under single impairment test 714,393.28
Profit or loss from outward entrusted loans -
Profit or loss from changes in fair value of investment
property subsequently measured by adopting the fair
value model -
Impact on the current profit or loss of the one-time
adjustment to the current profit or loss made as
required by the laws and regulations on tax and
accounting -
Revenue from trustee fee from the entrusted
management -
Non-operating revenue and expenses other than the
above-mentioned items 167,143.72
Other items of profit or loss subject to the definition
of non-recurring profit or loss 999,863.22
Sub-total 42,507,658.15
Less: affected amount of income tax -
Affected minority equity (after tax) -
Total 42,507,658.15
13.2 Rate of return on net assets and earnings per share
Weighted average Earnings per share
Profit in the reporting period Net return on Basic earnings Diluted earnings
assets (%) per share per share
Net profit attributable to ordinary
shareholders of the Company -30.88 -0.33 -0.33
Net profit attributable to common
shareholders of the Company after
deducting the non-recurring profit
or loss -63.91 -0.69 -0.69
Notes to the Financial Statements Page90
CHONGQING JIANSHE VEHICLE SYSTEM CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Chongqing Jianshe Vehicle System Co., Ltd.
(Official seal)
April 27, 2023
Notes to the Financial Statements Page91
