China Fangda Group Co., Ltd. 2014 Annual Report
China Fangda Group Co., Ltd.
2014 Annual Report
March 2015
1
China Fangda Group Co., Ltd. 2014 Annual Report
I. Important Statement, Table of Contents and Definitions
The members of the Board and the Company guarantee that the
announcement is free from any false information, misleading statement or
material omission and are jointly and severally liable for the informations
truthfulness, accuracy and integrity.
All the Directors have attended the meeting of the board meeting at which
this report was examined.
The Board meeting reviewed and approved the profit distribution preplan:
distributing cash dividend of RMB0.3 for each ten shares to all shareholders on
the basis of all shares of the Company on December 31, 2014 and no dividend
share is issued to shareholders. No reserve is capitalized.
Mr. Xiong Jianming, the Chairman of Board, Mr. Lin Kebin, the Chief
Financial Officer, and Mr. Chen Yonggang, the manager of accounting
department declare: the Financial Report carried in this report is authentic and
completed.
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China Fangda Group Co., Ltd. 2014 Annual Report
Table of Contents
I. Important Statement, Table of Contents and Definitions .................................... 2
II. Company Profile ..................................................................................................... 7
III Financial Highlight .............................................................................................. 10
IV Board of Directors Report.................................................................................. 13
V Significant Events .................................................................................................. 37
VI Changes in Share Capital and Shareholders ..................................................... 42
VII Particulars about the Directors, Supervisors, Senior Management and
Employees ................................................................................................................... 48
VIII Corporation Governance ................................................................................. 56
IX Internal Control ................................................................................................... 61
X Financial Statements ............................................................................................. 63
XI Documents for Reference .................................................................................. 171
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China Fangda Group Co., Ltd. 2014 Annual Report
Definitions
Refers
Terms Description
to
Refers
Fangda Group, company, the Company China Fangda Group Co., Ltd.
to
Refers
Articles of Association Articles of Association of China Fangda Group Co., Ltd.
to
Refers
Meeting of shareholders Meetings of shareholders of China Fangda Group Co., Ltd.
to
Refers
Board of Directors Board of Directors of China Fangda Group Co., Ltd.
to
Refers
Supervisory Committee Supervisory Committee of China Fangda Group Co., Ltd.
to
Refers
Banglin Co. Shenzhen Banglin Technologies Development Co., Ltd.
to
Refers
Shilihe Co. Shenzhen Shilihe Investment Co., Ltd.
to
Refers
Shengjiu Co. Shengjiu Investment Ltd.
to
Refers Formerly Shenzhen Fangda Decoration Engineering Co., Ltd., now
Fangda Jianke, Fangda Decoration
to known as Shenzhen Fangda Jianke Group Co., Ltd.
Refers
Fangda Automatic Shenzhen Fangda Automation System Co., Ltd.
to
Refers
Fangda New Material Fangda New Materials (Jiangxi) Co., Ltd.
to
Refers
Fangda New Resource Shenzhen Fangda New Energy Co., Ltd.
to
Refers
Fang SOZN Guangdong Fangda SOZN Lighting Co., Ltd.
to
Refers
Shenyang Fangda Shenyang Fangda Semi-conductor Lighting Co., Ltd.
to
Refers
Shenzhen Woke Shenzhen Woke Semi-conductor Lighting Co., Ltd.
to
Hong Kong Junjia Refers Hong Kong Junjia Group Co., Ltd.
4
China Fangda Group Co., Ltd. 2014 Annual Report
to
Refers
Fangda Aluminium Jiangxi Fangda New Type Aluminum Co., Ltd.
to
Refers
Fangda Yide Co. Shenzhen Fangda Yide New Material Co., Ltd.
to
Refers
Dongguan Fangda New Material Dongguan Fangda New Material Co., Ltd.
to
Refers
Kexunda Co. Shenzhen Kexunda Software Co., Ltd.
to
Refers
Fangda Property Shenzhen Fangda Property Development Co., Ltd.
to
Refers Formerly Chengdu Fangda New Material Co., Ltd., now known as
Chengdu Fangda New Material
to Chengdu Fangda Construction Technology Co., Ltd.
Refers
Shenyang Decoration Fangda Decoration Engineering (Shenyang) Co., Ltd.
to
Refers
CSRC China Securities Regulatory Commission
to
Refers
SZSE Shenzhen Stock Exchange
to
Refers
Sponsor, Zhongshan Securities Zhongshan Securities Co., Ltd.
to
5
China Fangda Group Co., Ltd. 2014 Annual Report
Major Risk Statement
The Company has specified market, management and production and
operation risks in this report. Please review the potential risks and measures
mentioned in the discussion and analysis of future development in IV. Board of
Directors Report.
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China Fangda Group Co., Ltd. 2014 Annual Report
II. Company Profile
1. Company profiles
Stock ID Fangda Group, Fangda B Stock code 000055、200055
Modified stock ID (if any) None
Stock Exchange Shenzhen Stock Exchange
Chinese name China Fangda Group Co., Ltd.
Chinese abbreviation Fangda Group
English name (if any) CHINA FANGDA GROUP CO., LTD.
English abbreviation (if any) CFGC
Legal representative Xiong Jianming
Registered address Fangda Building, Kejinan 12th Avenue, High-tech Zone, Shenzhen, PR China.
Zip code 518057
Office address 20F, Fangda Building, Kejinan 12th Avenue, High-tech Zone, Shenzhen, PR China.
Zip code 518057
Website http://www.fangda.com
Email fd@fangda.com
2. Contacts and liaisons
Secretary of the Board Representative of Stock Affairs
Name Zhou Zhigang Guo Linchen
20F, Fangda Building, Kejinan 12th 20F, Fangda Building, Kejinan 12th
Address
Avenue, Hi-Tech Zone, Shenzhen Avenue, Hi-Tech Zone, Shenzhen
Tel. 86(755) 26788571 ext. 6622 86(755) 26788571 ext. 6622
Fax 86(755)26788353 86(755)26788353
Email zqb@fangda.com zqb@fangda.com
3. Information disclosure and inquiring
Information disclosure and inquiring Press medias China Securities Journal, Security Times, Shanghai Securities Daily, Hong
of information disclosure Kong Commercial Daily
Website assigned by CSRC to release the online
http://www.cninfo.com.cn
reports
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China Fangda Group Co., Ltd. 2014 Annual Report
Place for information inquiry Secretarial Office of the Board
4. Registration changes
Business license Tax registration
Registration date Registration place Organization code
number number
Shenzhen Bureau of
Industry &
First registration December 13, 1995 440301501124785 440301192448589 19244858-9
Commerce
Administration
Market Supervision
Registration at the
Administration of
end of the reporting June 20, 2013 440301501124785 440301192448589 19244858-9
Shenzhen
period
Municipality
Changes in main businesses since the
None
listing of the Company
In 1996, the Company listed it’s A and B shares and the controlling shareholder is
Shenzhen Fangda Group Co., Ltd. On August 25, 2000, the controlling shareholder
Changes in the controlling shareholders (if changed its name into Shenzhen Fangda Economic Development Co., Ltd. On July 5,
any) 2002, the controlling shareholder changed into Shenzhen Banglin Technologies
Development Co., Ltd. By the end of this reporting period, the controlling
shareholder remains the Shenzhen Banglin Technologies Development Co., Ltd..
5. Other information
Public accountants employed by the Company
Public accountants Grant Thornton (special general partner)
Address 5th Floor, Scitech Place, 22 Jianguomen Wai Avenue, Chaoyang District, Beijing, China
Signing accountant names Lin Kaiqin and Li Chunmei
Sponsor engaged by the Company to perform continued supervision and guide during the reporting period
√ Applicable □ Inapplicable
Sponsor name Office address Representatives Period of supervision and guide
The period started on July 15, 2010 and
ended on November 7, 2012. The
sponsor has submitted the sponsor report
29th Floor, New World Center,
to CSRC. Given that the fund raised
Zhongshan Securities Co., Ltd. 6009 Yitian Road, Futian He Lihui, Cui Lei
from non-public issue of the Company in
District, Shenzhen
2010 has not been fully used, the sponsor
will continue to perform supervision and
guide for the use of the fund.
Financial advisor engaged by the Company to perform continued supervision and guide during the reporting period
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China Fangda Group Co., Ltd. 2014 Annual Report
□ Applicable √ Inapplicable
9
China Fangda Group Co., Ltd. 2014 Annual Report
III Financial Highlight
1. Financial Highlight
The Company retroactively adjusts or restates financial statistics of the previous years because of changes in
account policies and correction of accounting errors.
□ Yes √ No
2014 2013 Increase/decrease 2012
Turnover (yuan) 1,938,324,435.51 1,747,620,845.74 10.91% 1,397,901,424.59
Net profit attributable to
shareholders of the listed company 96,998,429.76 85,676,863.78 13.21% 24,948,377.20
(yuan)
Net profit attributable to the
shareholders of the listed company
69,068,577.10 68,393,391.56 0.99% 7,361,274.38
and after deducting of
non-recurring gain/loss (RMB)
Net cash flow generated by
-557,893,929.44 156,544,620.31 -456.38% 59,262,071.37
business operation (RMB)
Basic earnings per share
0.13 0.11 18.18% 0.03
(yuan/share)
Diluted Earnings per share
0.13 0.11 18.18% 0.03
(yuan/share)
Weighted average net income/asset
8.14% 7.61% 0.53% 2.30%
ratio
End of 2014 End of 2013 Increase/decrease End of 2012
Total asset (RMB) 3,662,719,900.41 2,599,557,542.57 40.90% 2,327,802,889.51
Net profit attributable to the
shareholders of the listed company 1,234,930,863.46 1,160,639,730.85 6.40% 1,098,612,195.57
(RMB)
2. Differences in accounting data under domestic and foreign accounting standards
1. Differences in net profits and assets in financial statements disclosed according to the international and
Chinese account standards
√ Applicable □ Inapplicable
In RMB
Net profit attributable to the shareholders of the Net profit attributable to the shareholders of the
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China Fangda Group Co., Ltd. 2014 Annual Report
listed company listed company
This period Last period Closing amount Opening amount
On Chinese accounting
96,998,429.76 85,676,863.78 1,234,930,863.46 1,160,639,730.85
standards
Items and amounts adjusted according International Accounting Standards
On international accounting
96,998,429.76 85,676,863.78 1,239,694,261.70 1,165,403,129.09
standards
2. Differences in net profits and assets in financial statements disclosed according to the overseas and
Chinese account standards
□ Applicable √ Inapplicable
2. There is no difference in net profits and assets in financial statements disclosed according to the international
and Chinese account standards during the report period.
3. Explanation of the differences in accounting data under domestic and foreign accounting standards
√ Applicable □ Inapplicable
Net assets attributable to the listed company’s shareholders calculated according to the IAS is RMB4,763,398.24
higher than that calculated according to the domestic accounting standards, mainly attributable to the
capitalization of borrow expenses before the domestic Enterprise Accounting Standard was implemented on
January 1, 2007.
3. Accidental gain/loss item and amount
√ Applicable □ Inapplicable
In RMB
Items 2014 2013 2012 Notes
Non-current asset disposal gain/loss
(including the write-off part for which assets -24,398.43 -462,554.08 260,038.90
impairment provision is made)
Subsidies accounted into the current income
account (except the government subsidy
closely related to the enterprise’s business 2,340,175.75 1,815,855.07 6,275,756.00
and based on unified national standard
quota)
Capital using expense charged to
non-financial enterprises and accounted into 3,649,313.12 2,149,420.09 1,180,032.08
the current income account
Gain from entrusted investment or assets
2,144,844.80 306,301.37
management
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China Fangda Group Co., Ltd. 2014 Annual Report
Gain/loss from change of fair value of
transactional financial asset and liabilities,
and investment gains from disposal of
transactional financial assets and liabilities -2,852,885.00 3,448,207.99
and sellable financial assets, other than valid
period value instruments related to the
Company’s common businesses
Gain/loss from change of fair value of
investment property measured at fair value 34,897,632.10 16,647,859.74 12,290,834.22
in follow-up measurement
Other non-business income and expenditures
-3,671,724.03 1,929,934.59 917,890.35
other than the above
Less: Influenced amount of income tax 9,526,862.57 5,177,842.87 5,353,185.48
Influenced amount of minority
-973,756.92 -74,498.31 1,432,471.24
shareholders’ equity (after-tax)
Total 27,929,852.66 17,283,472.22 17,587,102.82 --
Explanation statement should be made for accidental gain/loss items defined and accidental gain/loss items
defined as regular gain/loss items according to the Explanation Announcement of Information Disclosure No. 1 -
Non-recurring gain/loss mentioned.
□ Applicable √ Inapplicable
No accidental gain/loss defined as recurrent gain/loss as defined in Explanation Announcement of Information
Disclosure No. 2
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China Fangda Group Co., Ltd. 2014 Annual Report
IV Board of Directors Report
1. Summary
In 2014, the growth of the Chinese economy continued slowing down, subdued by weak government
investment in fixed assets. Economic risks resurfaced, creating numerous difficulties for enterprises. To survive
the weak economy and increasingly fierce competition, the Company has continued improving the brand equity,
expertise and services, stabilizing the growth. In the report period, the Company recorded a sales income of
RMB1,938,324,400, up 10.91% year on year. The net profit attributed to owners of the parent reached
RMB96,998,400, up 13.21% year on year. The revenue from main businesses continued growing. In 2014, the
Company had secured new orders worth RMB2.816 billion with undelivered orders worth RMB3.268 billion,
which 172.04%, paving the way for the Company to complete the sales target for 2015. While developing existing
businesses, the Company has increased investment in new energy sector in the report period and focused on solar
power plants and LED lights as a development area.
1、 Curtain wall and material industry development trend
Currently, the curtain wall system and material sector remains the Company’s main source of sales revenue
and profit. The Company has further consolidated its brand advantages and visibility, making remarkable progress
in key sales regions. In the report period, the Company has won bids in a series of notable energy-saving and
green curtain wall and material projects. The curtain wall system used in Shenyu Shangcheng South project,
China Energy Storage Building, and Chongqing Tianhe Global Center is 300m high. The Company has sought to
expand the business size, improve field management, optimize design and engineering solutions, elevate
production and engineering efficiency, lower costs, consolidate profitability to boost the Company’s long-term
development.
The Company has adhered to the business philosophy of integrity, trust, cooperation and continuous
improvement and seeks to meet customers’ needs thanks to our customer-centered value, strong innovation and
high engineering quality, receiving wide recognition among customers. The Company won the title of
Outstanding Supplier in the report period.
2. New energy business
The Company established a new energy company to develop solar PV applications, PV construction and
LED industry. In the report period, the Company has entered into solar energy power plant construction
agreements of 900MWp in Jiangxi Pingxiang, Xinjian and Longnan and obtained government approval for solar
energy power plant construction of 100MWp. On December 23, 2014, the Board of Directors approved the
proposal of private A-share issuing. No more than 105 million shares (inclusive) will be issued to raise no more
than RMB1.008 billion. The fund will be used to support construction solar power plants and repay bank loans.
The private share issuing is now undergoing. Solar power generation business is a strategic business of the
Company and coincides with the national policy. The business enjoys a bright development lookout and will fuel
the Company’s long-term development.
In the report period, the Company acquired Fangda SOZN, which is specialized in LED lights. After the
acquisition, management teams are established to explore traditional channels and first- and second-tier markets in
China. The innovative direct sales mode is introduced and is high received among local customers and consumers.
Four modern production bases with new and outstanding equipment are set up, including more than 20 automatic
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China Fangda Group Co., Ltd. 2014 Annual Report
assembly lines and intelligent R&D and production devices. Fangda SOZN can produce more than 10 million
LED bulbs now with more than 100 patented technologies, more than 10,000 sales networks. The Company
continued to promote the online and office sales mode in order or tap on the advantages of e-business and
traditional sales channels, making Fangda SOZN the domestic leading LED bulb producer.
3. Metro screen door business
In the report period, several screen door orders entered design, production and engineering stage. Screen
doors for Shenzhen metro phase III line No.9 and 11, Xi’an metro line No.3, Wuhan metro phase II line No.4,
Nanchang metro line No.1, Fuzhou metro line No.1, Wuhan-Xiaogan railway, Singapore Dashi extension line
have been designed, produced and installed as scheduled. The screen door business's sales revenue increased
64.55% from the last year. During the report period, thanks to high reliability and stability, the Company’s
screen door systems made the record the zero failure in the one-million attempt service life test of the Singapore
Tuas expansion line and Nanchang No.1 line. The two projects have completed the one-million attempt service
life test and acceptance procedure and have been put into massive product.
The metro screen door maintenance business is high added-value service sector. As many screen doors enter
the maintenance cycle, the business enjoys a bright outlook. The Company has a natural advantage in this
high-end service industry. Our screen door system are independently developed by us, thus enabling us to provide
prompt, overall, effective and standard maintenance services for our customers without other third parties. In the
report period, the Company received maintenance orders in Tianjin, Nanjing and Shenzhen, showing the
Company’s leadership in the sector. The business will expand the Company’s rail transport industry line.
4. Fangda Town renovation
In the report period, Fangda Town renovation project has obtained construction permits. Since
commencement in 2014, various works have been performed as scheduled. The sales will start in the 4th quarter in
2015. To reach the sales target, the Company has launched promotion, business introduction, media development
and advertising in the report period.
5. Introducing talents and build the corporate culture
As orders increase rapidly over the past few year and five industry bases are put into operation, the Company
has further improved the management matrix, optimize the business process, aggressively introduced high-quality
and diligent management and technical professional to build a modern management led by engineers, technicians,
comprehensive management executives and technical sales representatives. The Company attaches great
importance to corporate culture and construction of a harmonious working environment. Various activities such as
health care lectures, speech competition, sports competitions are held for the staff, including birthday parties and
speed dating for single employees to refresh employees and get them ready for elevating the Company’s core
competitiveness.
6. Awards
In the report period, Fangda is selected by the national industry and commerce administration as a Chinese
well-known trademark and the Company is selected as one of the most promising listing company by Sina.
Fangda also won the title a Shenzhen well-known brand for 12 consecutive years.
Thanks to outstanding quality and brand equity, the Company has won a series of remarkable titles including
the 1994-2014 outstanding enterprise for sustained development, National Construction Engineering Award,
High-quality Construction Award, Guangdong Engineering Golden Award, Guangdong Construction Engineering
Quality Award, Shenzhen Golden Bull Engineering Award, National Construction Decoration Award, anmd QCC
silver and outstanding performance awards. Mr. Wei Yuexing, general manager of Fangda Jianke is given the title
as one of the Shenzhen 100 industry leaders in the curtain wall industry.
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China Fangda Group Co., Ltd. 2014 Annual Report
Fangda Automatic is given titles as the Xi’an metro construction outstanding supplier, advanced equipment
supplier, outstanding maintenance provider, Nanjing metro construction outstanding supplier, Dongguan railway
line R2 outstanding supplier, Wuhan metro line No.4 phase II outstanding supplier.
Jiangxi New Material was given the title as an outstanding company in the Nanchang Hi-tech Park, class-A
taxpayer.
2. Main business analysis
1. Summary
Implementation progress of development strategies and operating plans disclosed previously in the report period
In 2014, the growth of the Chinese economy continued slowing down, subdued by weak government
investment in fixed assets. Economic risks resurfaced, creating numerous difficulties for enterprises. To survive
the weak economy and increasingly fierce competition, the Company has continued improving the brand equity,
expertise and services, stabilizing the growth. In the report period, the Company recorded a sales income of
RMB1,938,324,400, up 10.91% year on year. The net profit attributed to owners of the parent reached
RMB96,998,400, up 13.21% year on year. The revenue from main businesses continued growing. In 2014, the
Company had secured new orders worth RMB2.816 billion with undelivered orders worth RMB3.268 billion,
which 172.04%, paving the way for the Company to complete the sales target for 2015. While developing existing
businesses, the Company has increased investment in new energy sector in the report period and focused on solar
power plants and LED lights as a development area.
The actual operating performance is over 20% lower or higher than the annual forecast result disclosed earlier.
□ Applicable √ Inapplicable
Change in the main business mode
□ Applicable √ Inapplicable
2. Revenue
The physical sales revenue is high the labor service revenue
√ Yes □ No
Industry Items Unit 2014 2013 YOY change (% )
Sales M2 2,479,915.61 2,472,558.74 0.30%
Curtain wall system
Output M2 2,593,192.46 2,403,890.85 7.87%
and materials
Inventory M2 220,123.14 106,846.3 106.02%
Explanation for a year-on-year change of over 30%
□ Applicable √ Inapplicable
Major orders on hand
√ Applicable □ Inapplicable
In the report period, the Company received orders worth RMB2.816 billion, of which 22.43% has realized output
value. By December 31, 2014, the order reserve amounted to RMB3.268 billion. All the orders have been fulfilled
as contracted.
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China Fangda Group Co., Ltd. 2014 Annual Report
Major changes or adjustment of products or services in the report period
√ Applicable □ Inapplicable
Fang SOZN was acquired in the repot period to add LED bulb into the Company’s product scope, creating a new
profit growth point.
Main customers
Total sales amount to top 5 customers (RMB) 379,625,604.60
Proportion of sales to top 5 customers in the annual sales 19.59%
Information of the Company's top 5 customers
□ Applicable √ Inapplicable
Other information about main customers
□ Applicable √ Inapplicable
3. Costs
Industry
In RMB
2014 2013
Industry Items Proportion in Proportion in YOY change (% )
Amount Amount
operating costs operating costs
Metal production Raw materials 929,436,079.36 67.40% 874,994,717.90 65.38% 6.22%
Metal production Labor 94,243,308.97 6.83% 76,722,963.79 5.73% 22.84%
Installation and
Metal production 299,337,209.27 21.71% 327,693,011.67 24.48% -8.65%
onsite expenses
Metal production Others 55,895,771.82 4.05% 59,002,837.42 4.41% -5.27%
Metal production Total 1,378,912,369.42 100.00% 1,338,413,530.78 100.00% 3.03%
Product
In RMB
2014 2013
Product Items Proportion in Proportion in YOY change (% )
Amount Amount
operating costs operating costs
Curtain wall
system and Raw materials 929,436,079.36 67.40% 874,994,717.90 65.38% 6.22%
materials
Curtain wall
system and Labor 94,243,308.97 6.83% 76,722,963.79 5.73% 22.84%
materials
Curtain wall
Installation and
system and 299,337,209.27 21.71% 327,693,011.67 24.48% -8.65%
onsite expenses
materials
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China Fangda Group Co., Ltd. 2014 Annual Report
Curtain wall
system and Others 55,895,771.82 4.05% 59,002,837.42 4.41% -5.27%
materials
Curtain wall
system and Total 1,378,912,369.42 100.00% 1,338,413,530.78 100.00% 3.03%
materials
Main suppliers
Purchase amount of top 5 suppliers (RMB) 431,310,596.92
Proportion of purchase amount of top 5 suppliers in the
26.44%
total annual purchase amount
Information of the Company’s top 5 suppliers
□ Applicable √ Inapplicable
Other information about main suppliers
□ Applicable √ Inapplicable
4. Expenses
None
5. R&D expenses
In the report period, Fangda Group has developed a series of new products and technology in low-carbon,
energy saving, environmental protection fields, including energy-saving and green curtain wall, solar power
curtain wall, aluminium-plastic composite panel, single-layer aluminium panel, honeycomb aluminum panel,
metro screen door system, LED lights, PV power plants. All the R&D projects have been reviewed and approved
by the Group’s technology committee. The products and technologies have independent intellectual property
rights and patents, which will give a strong booth to the Company’s long-term growth.
In the report period, the R&D expense totaled RMB86,772,900, accounting 4.48% of the operating revenue in
2014. It accounts for 7.02% of the interest attributed to owners of the parent on December 31, 2014
5. Cash flow
In RMB
Items 2014 2013 YOY change (% )
Sub-total of cash inflow from
1,684,047,696.92 1,806,435,338.47 -6.78%
business operations
Sub-total of cash outflow from
2,241,941,626.36 1,649,890,718.16 35.88%
business operations
Cash flow generated by
-557,893,929.44 156,544,620.31 -456.38%
business operations, net
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China Fangda Group Co., Ltd. 2014 Annual Report
Sub-total of cash inflow
302,123,140.16 120,915,060.37 149.86%
generated from investment
Subtotal of cash outflows 588,172,728.21 172,570,887.63 240.83%
Cash flow generated by
-286,049,588.05 -51,655,827.26 453.76%
investment activities, net
Subtotal of cash inflow from
1,303,817,100.01 529,000,000.00 146.47%
financing activities
Subtotal of cash outflow from
642,732,507.84 588,354,192.64 9.24%
financing activities
Net cash flow generated by
661,084,592.17 -59,354,192.64 -1,213.80%
financing activities
Net increase in cash and cash
-182,599,023.19 45,069,882.52 -505.15%
equivalents
Explanation for a year-on-year change of over 30%
Explanation of major difference between the cash flow generated by operating activities and the net profit in the
year.
3. Business composition
In RMB
Year-on-year Year-on-year Year-on-year
Turnover Operation cost Gross margin change in change in change in gross
operating revenue operating costs margin
Industry
Metal production 1,643,589,644.97 1,378,912,369.42 16.10% 2.71% 3.03% -0.26%
Product
Curtain wall
system and 1,643,589,644.97 1,378,912,369.42 16.10% 2.71% 3.03% -0.26%
materials
District
Domestic 1,856,320,639.39 1,546,696,308.96 16.68% 11.62% 11.23% 0.29%
Overseas 40,212,936.07 26,435,336.21 34.26% 16.27% 18.74% -1.37%
Main business statistics adjusted in the recent one year with the statistics criteria adjusted in the report period
□ Applicable √ Inapplicable
IV. Assets and Liabilities
1. Major changes in assets
In RMB
18
China Fangda Group Co., Ltd. 2014 Annual Report
End of 2014 End of 2013
Proportion in Proportion in Change Notes
Amount Amount
total assets total assets
212,430,798.8
Monetary capital 5.80% 333,876,921.97 12.84% -7.04%
7
Account 1,105,242,251.
30.18% 898,780,981.93 34.57% -4.39%
receivable 46
The inventory book value balance
at the end of the period increased
982,441,187.0 128.03% from the beginning. It is
Inventory 26.82% 428,537,851.82 16.49% 10.33%
5 because that the development cost of
Fangda Town renovation project
increased.
Investment real 226,279,523.3
6.18% 195,249,069.13 7.51% -1.33%
estate 9
Long-term share
11,048,660.43 0.30% 9,994,565.55 0.38% -0.08%
equity investment
489,714,684.6
Fixed assets 13.37% 462,930,269.98 17.81% -4.44%
3
Construction in
341,749.17 0.01% 940,841.00 0.04% -0.03%
process
2. Major changes in liabilities
In RMB
2014 2013
Proportio Proportion
Change Notes
Amount n in total Amount in total
assets assets
Short-term loans 1,100,000,000.00 30.03% 369,000,000.00 14.19% 15.84% Additional bank borrowing
3. Assets and liabilities measured at fair value
In RMB
Accumulative
Gain/loss changes in fair
Impairment Amount
Opening caused by value Amount sold in Closing
Items provided in the purchased in
amount changes in fair accounting into the period amount
period the period
value the income
account
19
China Fangda Group Co., Ltd. 2014 Annual Report
Financial assets
1. Financial
assets
measured at
fair value with
variations
accounted into
0.00 -2,852,885.00 16,263,675.00 13,410,790.00
current income
account
(excluding
derivative
financial
assets)
Investment real
174,778,756.62 34,897,632.10 91,831.63 198,513,586.15
estate
Total 174,778,756.62 32,044,747.10 91,831.63 16,263,675.00 211,924,376.15
Financial
0.00 0.00
liabilities
Major changes in the assets measurement property of the Company in the report period
□ Yes √ No
4. Main overseas capital
□ Applicable √ Inapplicable
5 Core Competitiveness Analysis
(1) Curtain wall system and material
1. Expertise and brand competitiveness
In response to the national call for energy saving and emission reduction, the Company has aggressively
develop solar electric and optimal and energy-saving curtain walls, developing a series of domestic and global
leading solar and energy-saving curtain wall products. The Company owns 372 curtain wall and material patents
(including 23 invention patents) and one software copyright, ranking top among domestic peers. It has achieved
many firsts in the industry and created incomparable brand equity, making it an optimal choice in the domestic
high-end curtain wall and material market. FANGDA is a nationwide well-known trademark in China.
2. Focusing on the high-end market to edge out competitors
Amid the fierce market competition, the Company has focused on the high-end energy-saving curtain wall
market and technical integration to improve high-end project quality. Moreover, it has focused resources on
high-end curtain wall engineering and won several Luban awards, Zhan Tianyou Civil Engineering awards and
Classic Construction for the 50th Anniversary of the Foundation of the People’s Republic of China, High-Quality
Construction, White Magnolia Prize and Customer Satisfactory Engineering and the title of “Top 10 Competitive
Chinese Curtain Wall Provider”. The Company has build a leading brand and created a clear edge in the
20
China Fangda Group Co., Ltd. 2014 Annual Report
high-end curtain wall market.
3. Well-developed industry base landscape
Thanks to continued investment in facilities, the Company has established a national business landscape with
Shenzhen as the headquarters, Dongguan Songshanhu as the base in the south, Beijing in the north, Chengdu in
the southwest and Shanghai and Nanchang in the east. The Dongguan Songshanhu and Nanchang bases are the
largest and most advanced curtain wall system and material production bases in China and across the world,
fueling the Company to increase its market share and competitiveness.
4. General supply advantage
The Company’s main business is design, production and engineering of curtain wall projects. The Company
has expanded into the entire industry chain. It improves the overall supply capability, reduces raw material cost;
and improves the engineering efficiency and engineering quality.
(2) New energy industry
In the report period, the Company set up the Shenzhen Fangda New Energy Co., Ltd. to develop solar energy
PV applications, PV construction and LED industry. The move will extend the Company’s energy-saving and
environment protection business, coincide with the national plan and industry policies as well as the development
trend of the industry.
1. Technical advantage
With more than ten years’ experience in developing solar energy PV power generating curtain wall
technology, the Company is the earliest company that masters the intelligent property right in the designing,
production and integration of solar energy PV curtain wall systems and is a pioneer in the application of PV
curtain wall technology. The Company built the first solar energy PV integrated building curtain wall system in
China – Shenzhen Fangda Building photoelectric curtain wall system.
2. Relation with other industries
Distributed solar PV industry is highly related to the Company’s business. It is closely related to construction.
Moreover, the Company has more than 10 years' experience in electrical product integration. The Company also
has more than 20 years’ experience in construction management and has the level-1 construction curtain wall
engineering qualification and electrical installation engineering qualification.
3. Strategic advantage
The Company is engaged in the upper, middle and downstream of the LED industry and is familiar with
industry policies in China. Currently, the Company is acquiring LED companies to realize fast expansion in the
LED business and seek to create a new profit source for the Company.
(3) Rail transport equipment business
1. Technical advantage
Through continued independent innovation, the Company has developed the global leading metro screen
door system with full intellectual property right and broken the monopoly of overseas competitors. The
Company has also compiled the Rail Transport Station Screen Door Standard, which is the first of its kind in
China. The standard was approved in April 2006 and was implemented on March 1, 2007. As the first standard
in the industry in China, the standard has played a key role in guiding the development of China’s rail transport
screen door industry and enabled the Company a dominant lead in the industry. Currently, the Company has 218
metro screen door patents, including 40 invention patents. The Company also has seven computer software
copyrights.
2. Brand equity
21
China Fangda Group Co., Ltd. 2014 Annual Report
So far, the Company has undertaken rail screen door projects in cities including Beijing, Shanghai, Tianjin,
Shenyang, Nanjing, Guangzhou, Shenzhen, Dongguan, Fuzhou, Nanchang, Wuhan, Xi’an, Dalian, Hong Kong,
Taipei and Singapore. It The Fangda screen door system has grasped a leading market share and established
incomparable brand influence thanks to its patents, standard and maintenance services. The Company has
emerged as the Chinese No.1 and global No.3 screen door provider, building a large competitive edge in the
global market.
(4) Real Estate
The Fangda Town renovation project is well-positioned and enjoys express transport, unique landscape
resources, preferential policies and moderate competition in the district. In additional industry buildings for
domestic use, the project comprises about 100,000 m2 of industry buildings for sales, 20,000 m2 of business
property and 70,000 m2 of industry buildings for lease. The project will be put into pre-sales in Q4 2015 and
sold out in 2017. The project will buoy the Company’s net assets and total assets, bring strong cash flows for the
Company, provide capital support for the development of businesses, and gain experience in the real-estate
development industry.
VI. Investment
1. External equity investment
(1) External investment: None
(2) Financial enterprise share held: None
(3) Securities investment
Number
Number
of shares
of shares Closing
Initial held at Opening Closing
Abbreviat held at book Gain/loss Accounti
Securities Code investmen beginning sharehold sharehold Source
ion end of the value (RMB) ng item
t cost of the ing ing
period (RMB)
period
(share)
(share)
Sino Oil Transacti
and Gas 16,263,67 100,000,0 13,410,79 -2,852,88 onal
Stock 00702 0 0.00% 0.56% Purchase
Holdings 5.00 00 0.00 5.00 financial
Ltd assets
16,263,67 100,000,0 13,410,79 -2,852,88
Total 0 -- -- -- --
5.00 00 0.00 5.00
Disclosure date of approval by
the Board of Directors of March 11, 2014
securities investment
Disclosure date of securities
None
investment approval by the
22
China Fangda Group Co., Ltd. 2014 Annual Report
Shareholders’ Meeting (if any)
(4) Shareholding in other listed companies: None
2. Trust wealth management, investment in derivatives and entrustment loan
(1) Wealth management
In RMB10,000
Actual
Impairme
Related Earning Principal gain/loss
Relations Type of nt Estimate
Trustee transactio Amount Start date End date recognitio recovered in the
hip product provision return
n n method actually report
(if any)
period
Estimated
Break-eve
Bank of Non-affili July 4, August annual
No n, fixed 2,000 2,000 0 8.54 8.54
China ated party 2014 11, 2014 yield
earning
4.1%
CMB Not
Estimated
Shenzhen earning-pr
Non-affili July 9, Septembe annual
Nanshan No otected 4,000 4,000 0 33.75 33.75
ated party 2014 r 3, 2014 yield
Sub-branc floating
5.5%
h earning
CMB Not
Estimated
Shenzhen earning-pr
Non-affili July 10, August annual
Nanshan No otected 4,000 4,000 0 20.71 20.71
ated party 2014 14, 2014 yield
Sub-branc floating
5.4%
h earning
CMB Not
Estimated
Shenzhen earning-pr
Non-affili October October annual
Nanshan No otected 3,000 3,000 0 0.59 0.59
ated party 17, 2014 20, 2014 yield
Sub-branc floating
2.4%
h earning
CMB
Estimated
Shenzhen Break-eve
Non-affili October October annual
Nanshan No n, floating 6,695 6,695 0 1.32 1.32
ated party 17, 2014 20, 2014 yield
Sub-branc earning
2.4%
h
CMB Not Estimated
Shenzhen Non-affili earning-pr October October annual
No 4,695 4,695 0 3.09 3.09
Nanshan ated party otected 21, 2014 31, 2014 yield
Sub-branc floating 2.4%
23
China Fangda Group Co., Ltd. 2014 Annual Report
h earning
Estimated
Bank of Non-affili Earning-p December January 4, annual
No 3,000 0 0.92
China ated party rotected 31, 2014 2015 yield
2.8%
CMB Not
Estimated
Shenzhen earning-pr
Non-affili October October annual
Nanshan No otected 10 10 0 0.01 0.01
ated party 10, 2014 17, 2014 yield
Sub-branc floating
5.21%
h earning
CMB Not
Estimated
Shenzhen earning-pr
Non-affili October October annual
Nanshan No otected 5,000 5,000 0 5.67 5.67
ated party 21, 2014 29, 2014 yield
Sub-branc floating
5.17%
h earning
Not
Actual
CCB earning-pr
Non-affili December January 4, annual
Shenzhen No otected 6,000 0 0 2.05
ated party 31, 2014 2015 yield
Branch floating
3.12%
earning
CCB Not
Shenzhen earning-pr Estimated
Non-affili December January 3,
OCT No otected 1,000 yield 0 0 0.34 0
ated party 31, 2014 2015
Sub-branc floating 3.12%
h earning
Not
Estimated
CCB earning-pr
Non-affili December January 4, annual
Shenzhen No otected 6,800 0 0 2.33 0
ated party 31, 2014 2015 yield
Branch floating
3.12%
earning
Not
earning-pr Estimated
Bank of Non-affili December January 4,
No otected 3,000 yield 0 0 2.07 0
China ated party 26, 2014 2015
floating 2.5%
earning
Not
Estimated
CCB earning-pr
Non-affili December January 3, annual
Shenzhen No otected 3,000 0 0 1.83 0
ated party 31, 2014 2015 yield
Branch floating
3.1%
earning
Total 52,200 -- -- -- 29,400 0 83.22 73.68
24
China Fangda Group Co., Ltd. 2014 Annual Report
Source of fund Self-owned fund
Principal and return due but not covered 0
Lawsuit (if any) None
Disclosure date of approval announcement
March 11, 2014
(if any)
Disclosure date of Shareholders' Meeting
None
approval announcement (if any)
(2) Derivative investment
In RMB10,000
Proportio
n of
closing
investmen Actual
Derivativ Impairme
Related Initial Closing t amount gain/loss
e Relations Initial nt
transactio Type Start date End date investmen investmen in the in the
investmen hip amount provision
n t amount t amount closing report
t operator (if any)
net assets period
in the
report
period
Shanghai
Shanghai May 5, July 23,
Futures None No 1,459.21 0 0 0 0.00% 21.94
aluminum 2014 2014
Exchange
Total 1,459.21 -- -- 0 0 0 0.00% 21.94
Capital source Self-owned fund
Lawsuit (if any) Inapplicable
Disclosure date of derivative investment
approval by the Board of Directors (if any)
Disclosure date of derivative investment
approval by the Shareholders’ Meeting (if None
any)
To prevent the risk of fluctuation of raw material prices, the Company adopted the
Risk analysis and control measures for the
aluminum futures exchanged at the domestic futures exchange to provide hedging for
derivative holding in the report period
aluminum as a raw material for the Company. The Company has set up and
(including without limitation market,
implemented the Provincial Regulations on China Fangda Group Domestic Futures
liquidity, credit, operation and legal risks)
Hedging to prevent risks.
Changes in the market price or fair value of The fair value of the derivative should be calculated with the open quotation of the
the derivative in the report period, the futures market and should be reviewed regularly to ensure effective hedging.
25
China Fangda Group Co., Ltd. 2014 Annual Report
analysis of the derivative’s fair value
should disclose the method used and
related assumptions and parameters.
Material changes in the accounting policies
and rules related to the derivative in the No
report period compared to last period
Opinions of independent directors on the
Company’s derivative investment and risk None
controlling
(3) Trusted loans: None
3. Use of raised capital
(1) Overview
In RMB10,000
Total amount of the raised capital 33,658.69
Total raised capital invested in the report period 760.64
Total accumulative raised capital invested 31,431.04
Amount of raised capital of which the purpose was
0
changed in the report period
Accumulative amount of raised capital of which the
6,000
purpose has been changed
Proportion of raised capital of which the purpose has
17.83%
been changed
Notes to use of raised capital
By the end of the report period, the Company has strictly comply with the Instruction on Standard Operation of PLCs on the Main
Board of Shenzhen Stock Exchange and provisions for use and management of raised capital of the Company to deposit and use the
raised capital.. The raised capital totaled RMB314,31 million.
(2) Promised raised-capital-based projects
In RMB10,000
If Investme Date
Promised Accumul
Project promised to be investme nt when the Whether Any
total Adjusted Investme ative Profit
invested with the raised nt project progress project the major
investme total nt in the investme realized
capital and investment is by the become estimate change in
nt of the investme report nt by the in the
of the excessive raised changed end of the useable profit is the
raised nt (1) period end of the period
capital (includin period (3) as realized feasibility
capital period (2)
g partial ＝(2)/(1) proposed
26
China Fangda Group Co., Ltd. 2014 Annual Report
change)
Promised investment projects
Energy-saving and PV
June 30,
curtain wall production Yes 21,000 27,000 631.15 25,370.21 93.96% 6,270.22 Yes No
2013
expansion project
Decembe
PSD production
Yes 12,658.69 6,658.69 129.49 6,060.83 91.02% r 31, 1,227.83 No No
expansion project
2012
Subtotal of promised
-- 33,658.69 33,658.69 760.64 31,431.04 -- -- 7,498.05 -- --
investment projects
Investment of excessive raised capital
Total -- 33,658.69 33,658.69 760.64 31,431.04 -- -- 7,498.05 -- --
Reason or situation that
not on schedule (on None
specific project)
Notes to major changes
None
in project feasibility
Amount, purpose and Inapplicable
use of excessive raised
capital
Applicable
Occurred in previous years
Changes in
implementation place To improve the Company's industry landscape, simplify the Company’s management and reduce
of investment funded management costs, the 24th meeting of the 5th term of the Board of the Company approved the proposal of
by raised capital changing the implementation place of the energy-saving and photo-electric curtain wall production
expansion project and increasing the implementation entities and changed the implementation place to
Dongguan, Guangdong.
Applicable
Adjustment of the
Occurred in previous years
implementation way of
investment funded by On March 9, 2012, the 1st provisional shareholders’ meeting of the Company approved the adjustment
raised capital proposal to put the RMB60 million for the metro screen door production expansion to the energy-saving
and photo-electric curtain wall production expansion project.
Applicable
On September 30, 2010, it was decided to use the raised capital of RMB4,347,753.09 to replace the
Initial use of raised investment made previously by Fangda Automatic RMB1,403,503.00 and Fangda Decoration
fund in projects and RMB2,944,250.09. This has been verified by CPA with report 天健正信审（2010）专字第 020722 号. The
replacement exchange of a self-financed capital of RMB4,347,753.09 using the raised capital has been verified by
Ascenda Certified Public Accountants with 天健正信审（2010）专字第 020722 号 and Self-Raised
Capital Investment Project Verification Report issued.
27
China Fangda Group Co., Ltd. 2014 Annual Report
Applicable
On September 30, 2010, payment of RMB20 million was made from idle proceeds to Fangda Decoration;
and RMB10 million was made to Fangda Automatic. On March 22, 2011, the returned idle capital RMB30
million was transferred to raise capital account. On March 28, 2011, payment of RMB20 million was made
from idle proceeds to Fangda Decoration; and RMB10 million was made to Fangda Automatic. On August
19, 2011, the returned idle capital RMB30 million was transferred to raise capital account. On August 23,
2011, payment of RMB20 million was made from idle raised capital to Fangda jianke; and RMB10 million
Idle raised capital used was made to Fangda Automatic. On February 16, 2012, the returned idle capital RMB30 million into the
as working capital raised capital account. On February 22, 2012, payment of RMB20 million was made from idle proceeds to
Fangda Decoration; and RMB10 million was made to Fangda Automatic. On August 15, 2012, the returned
idle capital RMB30 million was transferred to raise capital account. On August 17, 2012, payment of
RMB20 million was made from idle proceeds to Fangda Decoration; and RMB10 million was made to
Fangda Automatic. On February 4, 2013 the returned idle capital RMB30 million was transferred to raise
capital account. On February 25, 2013, payment of RMB22 million was made from idle proceeds to
Fangda Decoration; and RMB8 million was made to Fangda Automatic. On July 15, 2013, the returned
idle capital RMB30 million was transferred to raise capital account.
Applicable
On July 15, 2013, the surplus raised capital (including interest income RMB was transferred to permanent
working capital. On August 22, 2014, raised capital (including interest) 5,150,302.35 was transferred to
permanent working capital of the Company. The remaining raise capital was due to: 1. the Company
Surplus of investment
strictly implements multi-supply purchase system and project tendering and bidding regulations, thus
and cause
trimming the engineering and equipment purchase costs. 2. in the process of engineering and
construction, the Company has taken effective measures to control, supervise and manage engineering
costs. 3. the Company has taken effective measures to improve utilization of its resources and optimize
its processes to cut the project investment.
Use plan of retained
Inapplicable
fund from financing
Problem or situation in
using of raised capital None
and disclosing
(3) Altering of projects financed by raised capital
In RMB10,000
Total Accumulati Any major
Investment Date when
investment Actual ve actual Whether the change in
Correspondi progress by the project Profit
Altered of raised investment investment estimate the
ng promised the end of become realized in
project capital in in the report by the end profit is feasibility
project the period useable as the period
the altered period of the realized after the
(3)＝(2)/(1) proposed
project (1) period (2) alteration
Energy-savi Energy-savi June 30,
27,000 631.15 25,370.21 93.96% 6,270.22 Yes No
ng and PV ng and PV 2013
28
China Fangda Group Co., Ltd. 2014 Annual Report
curtain wall curtain wall
production production
expansion expansion
project project
2. PSD 2. PSD
production production December
6,658.69 129.49 6,060.83 91.02% 1,227.83 No No
expansion expansion 31, 2012
project project
Total -- 33,658.69 760.64 31,431.04 -- -- 7,498.05 -- --
The screen door project in Nanchang aimed to use a plant in Dafang Jiangxi new material
industry zone as the production base. This can reduce the investment of RMB60 million for
new plant, office and facilities. According to the resolution of the 24th meeting of the 5th
term of the Board, the proposal of changing the implementation place of the energy-saving
Alteration reason, decision-making
and photo-electric curtain wall production expansion project and increasing the
process and information disclosure (by
implementation entities was approved to change the implementation place to Dongguan,
project)
Guangdong. As a new factory and part of the office and facilities must be built in
Dongguan, the investment is forecast to increase to RMB75 million. Given the alteration
of the two projects, the capital RMB 60 million for the screen door project is transferred to
the curtain wall project, while the insufficient part made up by the self-owned capital.
The delivery process of metro screen door takes a long period of time. The Company
Reason or situation that not on received orders of RMB613 million from 2013 to 2014, accounting for nearly 70% of the
schedule (on specific project) national aggregate. Orders to be delivered by the end of 2014 are worth RMB468 million.
The screen door production expansion will support the sales and order delivery.
Notes to major changes in project
None
feasibility after the alteration
4. Analysis of major subsidiaries and joint-stock companies
Major subsidiaries and joint-stock companies
In RMB
Main
Compan products Registered Operation
Type Industry Total assets Net assets Turnover Net profit
y or capital profit
services
Curtain
Fangda Subsidia Decorati 1,499,837,7 81,813,917. 70,755,15
wall 500,000,000 2,297,588,580.12 749,684,129.22
Jianke ry on 03.29 19 6.37
system
Fangda Metro
Subsidia Railroad 163,158,433 9,060,690.9 8,973,274.
Automat screen 105,000,000 396,147,819.22 192,209,221.13
ry industry .01 9 56
ic door
Kexunda Subsidia Railroad Software 1,000,000.00 57,361,368.99 2,774,714.13 13,472,393. 10,975,280. 12,861,41
29
China Fangda Group Co., Ltd. 2014 Annual Report
Co. ry industry develop 23 62 5.59
ment
and
system
integrati
on
Major subsidiaries and joint-stock companies
None
Acquisition and disposal of subsidiaries in the report period
√ Applicable □ Inapplicable
Acquisition and disposal Acquisition and disposal
Impact on production and
Company purpose of subsidiaries in the method of subsidiaries in the
performance
report period report period
Guangdong Fangda SOZN Speed up expansion to LED
Purchase Create new profit growth
Lighting Co., Ltd. business
5. Major projects of non-raised capital: None
VII. Forecast of operating performance between January and March in 2015
Warning and reasons of possible net loss or substantial change from the last period between the beginning of the
year and the end of the next report period
□ Applicable √ Inapplicable
VIII. Entities on which the Company has control power: None
IX. Future Prospect
(1) Industry competition map and development trend
Curtain wall and material system industry
According to the Chinese Building Decoration Industry 12th Five-year Plan, the domestic building curtain
wall industry is worth RMB400 million in 2015. The urbanization will accelerate the market demand and give a
strong booth to the development of the industry. The government also released a series of policies to support the
development of the industry.
(2) New energy industry
1. Solar power industry
The solar power generation industry is supported by the Chinese government. Since late 2012, the state
council, finance minister, energy administration and state grid have issued a series of policies to regulate various
issues related to PV power generation and subsidies for distributed power plants. Despite that most on-grid power
generation is centralized power plants, accounting for 84% in 2013, distributed power plants will develop rapidly
with the government support.
(2) LED light
30
China Fangda Group Co., Ltd. 2014 Annual Report
LED as the new lighting technology has won support in many countries and organizations, which issued
many policies to support the development of the industry. The retirement of incandescent light bulbs will explode
the development of LED lights. In November 2011, China released the incandescent light bulb retirement
roadmap. All incandescent light bulbs will be retired in China by 2016. Recently, National Development and
Reform Committee and tax administration released the announcement on subsidies for EMC project enterprise.
The government concern for energy conservation will boost the development of the LED industry.
(3) Rail transport equipment business
In the 12th Five-year period, the urban metro and railway construction mileage will reach2,600km, with a
total investment of RMB1.27 trillion. Screen door is a key device for metro. Therefore, the demand will remain
strong.
(4) Real estate
As the land resource becomes increasingly rare, the urban renovation has become a common issue for many
large cities. Shenzhen government has released a series of policies to encourage renovation projects. Fangda
Town renovation project is located into the crossroad of Dashahe Innovation Corridor and OCT cultural
innovation ring.
(2) Corporate development strategy and operating plan
2015 will witness remarkable innovation and development, as well as business, concept transformation of
the Company. A series of internal reforms will be launched to improve the comprehensive competitiveness and
operation efficiency, fueling the Company’s long-term development. The development of the new energy business
is a strategic part in the Company’s development plan. The Company will grasp the gold opportunities to blend
industry, financial and business innovation and blaze a new trail in developing the new energy industry. The
Company will further consolidate its position as the domestic leading supplier of metro screen doors and expand
into the global market. The Company will ensure the quality of the Fangda Town renovation project and meet the
sales target.
(3) Capital demand for support existing business and construction in progress
The development of the Company’s main business and Fangda Town renovation project increase the capital
demand. Therefore, the Company has approved the proposal of private A-share issuing to raise RMB1.008 billion,
which will be used to fund construction of solar power plants. To realize the operating target in 2015, the
Company will formulate reasonable financial and capital plans to add more financing channels and self-owned
fund and bank loans to meet the capital demand.
(4) Potential risks and measures
1. Market risks and measures
As the overall designing and engineering quality continues improving in the domestic construction curtain
wall industry, curtain wall products will become increasingly standard, intensifying the market competition. The
Company will continue implementing a prudent operation strategy, fine management and technical innovation to
lower the management costs and accelerate the recovery of receivables. Through new technologies and
processes, we will improve product quality, lower costs and elevate earnings. While consolidating the domestic
market, the Company will step up the efforts in exploring overseas markets, thus elevating our competitiveness in
global markets and improving our resistance to risks.
2. Management risks and measures
With an increase in orders in recent years and operation of six industry bases, the Company has continued
expanding rapidly in terms of capitalization, business and teams. The organizational structure and management
system have become more complicated, leading to management risks in industry expansion. The Company will
31
China Fangda Group Co., Ltd. 2014 Annual Report
continue to improve the matrix management mode, integrate business management, optimize the business flow,
seeking to build a high-efficient and solid management team. We will introduce high-quality, professional
technical and management talents in different fields to strengthen the Company's core competitiveness.
3. Production and operation risks and measures
The macro-economy and market demand have added to the fluctuation in prices of main raw materials such
as aluminum and steel and labor, affecting the Company’s profitability and creating additional production and
operation risks for the Company. The Company has sought to lower the purchase and production costs, pay
attention to technical R&D, reduce consumption of raw materials, introduce automatic and intelligent production
equipment, and strengthen staff training to improve working efficiency.
4. Management and implementation risks in Fangda Town renovation project and measures
As the first real-estate project undertaken by the Company, the Fangda Town renovation project may lead to
risks for the company in project management and implementation. The Company has recruited a professional
and experienced team and a solid internal control system to manage and implement the project.
X Statement of the Board on the “non-standard auditors report” issued by the CPA on the
current report period
□ Applicable √ Inapplicable
XI The Companys accounting policies, estimates and calculation methods have remained
unchanged from the last annual report.
XII. Retrospective restatement of major accounting errors in the report period
13. Statement of change in the financial statement consolidation scope compared with the
previous financial report
√ Applicable □ Inapplicable
Acquire Guangdong Fangda SOZN Lighting Co., Ltd. under different control in the report period.
Fangda New Energy and Shihui International Holding were established and consolidated in the period.
Fangda Yi was liquidated in the period and removed from consolidate statements.
XIV Profit distribution and dividend payment of the Company
Formulation, execution or adjustment of profit distribution policy in the report period
√ Applicable □ Inapplicable
To regulate cash dividend distribution and improve distribution transparency, according to CSRC [2013]
No.43 Cash Dividend of Listed Companies, the Company revised profit distribution policies and terms in the
Articles of Associations and formulated the Shareholder Return Plan for 2015-2017, which were approved at the
8th meeting of the 7th Board of Directors and 1st extraordinary shareholders’ meeting in 2015.
During the report period, the Company implemented the profit distribution plan for 2013. Approved at the
Shareholders' Meeting 2013 held on March 31, 2014, the Company's profit distribution plan for 2013 is
distributing a cash dividend of RMB0.30 (tax-included) for every ten shares of all the shareholders based on a
32
China Fangda Group Co., Ltd. 2014 Annual Report
total of 756,909,905 shares on December 31, 2013. The plan was implemented on April 15, 2014 (see the 2013
Share Equity Distribution Implementation Announce 2014-29).
Explanation of Cash Dividend Distribution Policies
Comply with the Articles of Association or resolution made at
Yes
the General Shareholders' Meeting
Clear and definite distribution standard and proportion Yes
Decision-making procedure and mechanism Yes
Independent directors fulfill their duties Yes
Middle and small shareholders express their opinions and claims.
Yes
There rights are well protected.
Cash dividend distribution policies are adjusted or revised
Yes
according to law
Profit distribution and reserve capitalizing pre-plans or plans over the recent three years (including the reporting
period)
2012: A cash dividend of RMB0.30 (including tax) for each ten shares is issued to all shareholders on the basis of
756,909,905 shares with a total amount of RMB 22,540,512.87, on December 31, 2012. No dividend share or
capitalization share is issued in the year.
2013: A cash dividend of RMB0.30 (including tax) for each ten shares is issued to all shareholders on the basis of
756,909,905 shares with a total amount of RMB 22,707,297.15, on December 31, 2013. No dividend share or
capitalization share is issued in the year.
2014: A cash dividend of RMB0.30 (including tax) for each ten shares is issued to all shareholders on the basis of
756,909,905 shares with a total amount of RMB 22,707,297.15, on December 31, 2014. No dividend share or
capitalization share is issued in the year.
Cash dividends for the recent three years
In RMB
Proportion of the
Net profit Proportion in the net Amount of
amount of
attributable to project attributable repurchased share
Cash dividend repurchased share
Year shareholders in the to shareholders in capital in cash
(including tax) capital in cash
consolidated the consolidated included in cash
included in cash
financial statements financial statements dividend
dividend
2014 22,707,297.15 96,998,429.76 23.41% 0.00 0.00%
2013 22,707,297.15 85,676,863.78 26.50% 0.00 0.00%
2012 22,540,512.87 24,948,377.20 90.35% 0.00 0.00%
No cash dividend is proposed despite the Company records profits in the report period and a positive undistributed
profit/
□ Applicable √ Inapplicable
33
China Fangda Group Co., Ltd. 2014 Annual Report
XV Profit Distribution and Reserve Capitalization Plan in the Report Period
√ Applicable □ Inapplicable
Bonus shares for every ten shares 0
Cash dividend for every ten shares (yuan,
0.30
tax-included)
Share dividend for each ten shares (share) 0
A total number of shares as the distribution basis 756,909,905
Total cash dividend (yuan, including tax) 22,707,297.15
Distributable profit (yuan) 404,322,761.53
Proportion of cash dividend in the distributable
100.00%
profit
Cash dividend distribution policy
The Company is in a fast growth stage. Therefore, the cash dividend will reach 20% of the profit distribution at least.
Details of profit distribution or reserve capitalization plan
The Company plans to distribute a cash dividend of RMB0.30 (including tax) for each ten shares issued to all shareholders on
the basis of 756,909,905 shares with a total amount of RMB22,707,297.15, on December 31, 2014. No dividend share or
capitalization share is issued in the year.
The plan needs to be reviewed and approved at the General Shareholders' Meeting 2014.
XVI Social responsibilities
√ Applicable □ Inapplicable
In the reporting period, the Company has positively assumed social responsibilities by: paying taxes
RMB105 million, up 13.20% year-on-year; donating RMB958,000 and investing RMB771,800 in environment
protection, create nearly 10,000 jobs; inputting RMB2.1421 million in employee knowledge and skill training.
The company has invested RMB86.77 million to promote development of new draft, technology, product
structure and patent according to clean, safety and efficient production to make contribution for environmental
protection.
Are the listed company and subsidiaries involved in a heavy-pollution industry defined by the national
environment protection department?
□ Yes √ No □ N/A
Do the listed and subsidiaries cause any material security problems to the society?
□ Yes √ No □ N/A
Did the listed and subsidiaries receive any administration penalty in the report period?
□ Yes √ No □ N/A
34
China Fangda Group Co., Ltd. 2014 Annual Report
XVII Reception of investigations, communications, or interviews in the reporting period
√ Applicable □ Inapplicable
Main content involved and
Time/date Place Way Visitor Visitor
materials provided
Industrial
Securities,
Onsite Business and future
March 13, 2014 Shenzhen Institution Goldstate
investigation development
Securities and
Guosen Securities
Onsite Goldstate Business and future
March 18, 2014 Shenzhen Institution
investigation Securities development
Onsite Business and future
March 19, 2014 Shenzhen Institution Essences Securities
investigation development
Onsite Dongxing Business and future
April 23, 2014 Shenzhen Institution
investigation Securities development
Onsite Business and future
May 14, 2014 Shenzhen Institution Minsen Investment
investigation development
Industrial
Securities,
Citic-Prudential
Fund, CCFund,
Onsite Fortune SG Fund, Business and future
May 21, 2014 Shenzhen Institution
investigation Bosera Fund, development
Essence Fund,
Galaxy AMC,
Qianhai QianBaBa
Fund
Onsite Business and future
June 26, 2014 Shenzhen Institution China Post Fund
investigation development
Onsite Business and future
July 4, 2014 Shenzhen Institution Fullgoal Fund
investigation development
CMS, Shenyin &
Onsite Business and future
July 8, 2014 Shenzhen Institution Wanguo, Southern
investigation development
Fund
GF Securities,
Invesco Great Wall
Onsite fund, QHKY Fund, Business and future
July 14, 2014 Shenzhen Institution
investigation Industrial development
Securities,
Prudential Fund
35
China Fangda Group Co., Ltd. 2014 Annual Report
Shenzhen,
Onsite Business and future
July 24, 2014 Dongguan Institution Shenyin & Wanguo
investigation development
Songshanhu
Onsite Hong Yuan Business and future
September 3, 2014 Shenzhen Institution
investigation Securities development
Onsite Business and future
November 3, 2014 Shenzhen Institution Shenyin & Wanguo
investigation development
Onsite Business and future
November 13, 2014 Shenzhen Institution Yuanta Funds
investigation development
Shenyin &
Wanguo, China
Investment
Securities, Invesco
Onsite Great Wall fund, Business and future
December 2, 2014 Shenzhen Institution
investigation Yintai Securities, development
Qianhai Anzhou
Capital, Rongyao
Investment, Daoyi
Assets
Number of reception 15
Number of institutions 34
Disclosed or leaked uncovered material
No
information
36
China Fangda Group Co., Ltd. 2014 Annual Report
V Significant Events
I. The Company has no significant lawsuit or arbitration affair in the report period.
II. The Company has no significant affair that arouses media questioning.
III. The controlling shareholder and its affiliates occupied no capital for non-operating
purpose of the Company during the report period.
IV. The Company has no bankruptcy or reorganization events in the report period.
V. Assets trade
1. The Company required no assets in the report period.
2. The Company sold no assets in the report period.
3. Enterprise merger
√ Applicable □ Inapplicable
On July 18, 2014, the Company entered into an agreement with natural person Luo Huichi to acquire 60%
stake in the Guangdong Fangda SOZN Lighting Co., Ltd (“New Company”) set upo with the fixed assets,
intangible assets, sales networks and teams of three LED lighting companies controlled by Luo. The investment
does not exceed RMB48 million in cash. The payment includes conditional stock transfer to Luo and conditional
investment to the New Company. The Announcement on Acquiring Zhongshan SOZN Lighting Co., Ltd. and LED
Lighting Business of Its Affiliates was published on China Securities Journal, Shanghai Securities Daily,
Securities Times, HKCD and www.cninfo.com.cn on July 22, 2014. The acquisition will accelerate the
Company’s LED business expansion and create new profit growth opportunities. As part of the Company’s new
energy development strategy, it coincides with the Company’s development shift onto energy-saving industries
and will optimize the Company’s business structure, thus propelling the Company’s long-term growth. The
acquisition has completed as scheduled. Fangda SOZN recorded a tax-included income of RMB136,832,908.41
between July and December 2014.
37
China Fangda Group Co., Ltd. 2014 Annual Report
VI. The Company made or implemented no option incentive scheme in the report period.
VII. Material related transactions
1. The Company made no related transaction related to daily operating in the report period.
2. The Company made no related transaction of assets requisition and sales in the report period.
3. The Company made no related transaction of joint external investment in the report period.
4. The Company had no related debt in the report period.
5. The Company has no other related transaction in the report period.
VIII. Significant contracts and performance
1. Asset entrusting, leasing, contracting
(1) The Company made no custody in the report period
(2) The Company made no contract in the report period
(3) Leasing
Leasing
The Company leases investment real estates and obtained a lease income of RMB25,160,000 in the report period.
Projects that create gains accounting for over 10% of the Company’s total profit in the report period
□ Applicable √ Inapplicable
The Company leased no projects that create gains accounting for over 10% of the Company’s total profit in the
report period.
2. Guarantee
The Company made no external guarantee (excluding for subsidiaries)
In RMB10,000
Guarantee provided to subsidiaries
Actual date of
Guarantee provided Date of Guarantee occurring Actual amount Type of Complete Related
Term
to disclosure amount (signing date of of guarantee guarantee d or not party
agreements)
since engage
March 11, September 3,
Fangda Jianke 36,000 22,823.38 Joint liability of contract to No No
2014 2014
2 years upon
38
China Fangda Group Co., Ltd. 2014 Annual Report
due of debt
since engage
March 11, October 20, of contract to
Fangda Jianke 20,000 19,945.62 Joint liability No No
2014 2014 2 years upon
due of debt
since engage
March 11, September 9, of contract to
Fangda Jianke 25,000 14,613.72 Joint liability No No
2014 2014 2 years upon
due of debt
since engage
March 11, of contract to
Fangda Jianke 20,000 June 16, 2014 19,822.97 Joint liability No No
2014 2 years upon
due of debt
since engage
March 11, September 30, of contract to
Fangda Jianke 21,428 9,683.29 Joint liability No No
2014 2014 2 years upon
due of debt
since engage
November November 11, of contract to
Fangda Jianke 15,000 3,850 Joint liability No No
8, 2014 2015 2 years upon
due of debt
since engage
March 11, September 3, of contract to
Fangda Automatic 20,000 13,266.57 Joint liability No No
2014 2015 2 years upon
due of debt
since engage
November November 11, of contract to
Fangda Automatic 5,000 2,660 Joint liability No No
8, 2014 2015 2 years upon
due of debt
since engage
Fangda New March 11, of contract to
7,080 April 11, 2015 2,977.68 Joint liability No No
Material 2014 2 years upon
due of debt
since engage
Fangda New March 11, of contract to
8,000 May 5, 2015 5,573.29 Joint liability No No
Material 2014 2 years upon
due of debt
since engage
January 4, January 29, of contract to
Fangda Property 21,000 11,000 Joint liability No No
2014 2014 2 years upon
due of debt
39
China Fangda Group Co., Ltd. 2014 Annual Report
Total of guarantee to
Total of guarantee to subsidiaries
264,000 subsidiaries actually occurred 148,787.48
approved in the report term (B1)
in the report term (B2)
Total of balance of guarantee
Total of guarantee to subsidiaries
actually provided to the
approved as of the report term 264,000 126,216.53
subsidiaries as of end of
(B3)
report term (B4)
Total of guarantee provided by the Company (total of the above two)
Total of guarantee approved in the Total of guarantee occurred in
264,000 148,787.48
report term (A1+B1) the report term (A2+B2)
Total of guarantee occurred as
Total of guarantee approved as of
264,000 of the end of report term 126,216.53
end of report term (A3+B3)
(A4+B4)
Percentage of the total guarantee occurred (A4+B4) on net asset
102.21%
of the Company
The Company made no incompliant external guarantee in the report period.
3. The Company entered into no other significant contract in the report.
4. The Company entered into no other significant contract in the report period.
IX. Performance of promises
1. The Company and shareholders with more than 5% stakes in the Company made no guarantee in the
report period or before report period but remaining effective in the report period.
2. Explanation and reason of profit forecasts on assets or projects that remain in the report period
□ Applicable √ Inapplicable
10. Engaging and dismissing of CPA
CPA engaged currently
Domestic public accountants name Grant Thornton (special general partner)
Remuneration for the domestic public accountants
130
(in RMB10,000)
Consecutive years of service by the domestic public
3
accountants
Name of certified accountants of the domestic public
Lin Kaiqin and Li Chunmei
accountants
40
China Fangda Group Co., Ltd. 2014 Annual Report
Overseas public accountants name (if any) None
Remuneration for the overseas public accountants
0
(in RMB10,000)
Consecutive years of service by the overseas public
None
accountants (if any)
Name of certified accountants of the overseas public
None
accountants (if any)
The CPA is not replaced
□ Yes √ No
Engaging of internal control audit CPA, financial advisor and sponsor
√ Applicable □ Inapplicable
This year, the Company continued engaging Grant Thornton (special general partner) as the internal control CPA.
The financial statement review fee is RMB1.3 million.
11. Statement of the Supervisory Committee and Independent Directors (if applicable) on the
“non-standard auditors report” issued by the CPA on the current report period
□ Applicable √ Inapplicable
XII. The Company received no penalty and made no correction in the report period.
XIII. Trade suspension and termination after the disclose of the annual report
XIV. The Company had no other significant event to be explained in the report period.
XV. Material events of subsidiaries
XVI. The Company issued no corporate bonds in the period.
41
China Fangda Group Co., Ltd. 2014 Annual Report
VI Changes in Share Capital and Shareholders
1. Changes in shares
1. Changes in shares
In share
Before the change Change (+,-) After the change
Issued Transferre
Bonus Subtot
Amount Proportion new d from Others Amount Proportion
shares al
shares reserves
I. Shares with trade
779,292 0.10% 779,292 0.10%
restriction conditions
3. Other domestic shares 779,292 0.10% 779,292 0.10%
Domestic natural
779,292 0.10% 779,292 0.10%
person shares
II. Shares without trading
756,130,613 99.90% 756,130,613 99.90%
limited conditions
1. Common shares in RMB 420,179,425 55.51% 420,179,425 55.51%
2. Foreign shares in
335,951,188 44.39% 335,951,188 44.39%
domestic market
III. Total of capital shares 756,909,905 100.00% 756,909,905 100.00%
Reasons
□ Applicable √ Inapplicable
Approval of the change
□ Applicable √ Inapplicable
Share transfer
□ Applicable √ Inapplicable
Impacts on financial indicators including basic and diluted earnings per share, net assets per share attributable to
common shareholders of the company in the most recent year and period
□ Applicable √ Inapplicable
Others that need to be disclosed as required by the securities supervisor
□ Applicable √ Inapplicable
42
China Fangda Group Co., Ltd. 2014 Annual Report
2. No change in shares with sales restriction
2. Share placing and listing
1. The Company issued no securities in the recent three years
□ Applicable √ Inapplicable
2. Statement of changes in share number and shareholder structure, assets and liabilities structure
□ Applicable √ Inapplicable
3. Current employees shares
□ Applicable √ Inapplicable
3. Shareholders and the substantial controller of the Company
1. Shareholders and shareholding
In share
Number of
Number of ordinary
Number of shareholders of
shareholders by the
shareholders of preferred stocks of
end of the 5th date
common shares at 46,209 52,741 which voting rights 0
day before the
the end of the report recovered in the
disclosure date of the
period report period (if any,
annual report
see Note VIII)
Shareholders holding 5% of the Company's shares or top-10 shareholders
Number of Pledging or freezing
Amount of
shares held at Change in the Conditio
Properties of Shareholdi shares without
Shareholder the end of the reporting nal Share
shareholder ng sales Amount
reporting period shares status
restriction
period
Shenzhen Banglin
Domestic
Technologies
non-state legal 9.09% 68,774,273 0 68,774,273 Pledged 14,150,000
Development Co.,
person
Ltd.
Shengjiu Investment Foreign legal
5.00% 37,845,591 +11,199,085 37,845,591
Ltd. person
Domestic
Huang Jupei 3.96% 30,001,000 +5,083,800 30,001,000
natural person
43
China Fangda Group Co., Ltd. 2014 Annual Report
Domestic
Zhou Shijian 2.79% 21,123,481 +21,123,481 21,123,481
natural person
Domestic
Shenzhen Shilihe
non-state legal 2.36% 17,860,992 0 17,860,992
Investment Co., Ltd.
person
Domestic
Yu Liandi 1.34% 10,121,923 +10,121,923 10,121,923
natural person
National Social
Insurance Portfolio Others 1.32% 9,999,832 +9,999,832 9,999,832
No.109
Domestic
Jiang Jing 1.19% 9,029,914 -1,605,526 9,029,914
natural person
ICBC-Lion Fund
Stock Investment Others 1.12% 8,513,474 +8,513,474 8,513,474
Fund
Bank of
Communication –
Huaan Chuangxin Others 0.79% 5,995,718 +5,995,718 5,995,718
Securities
Investment Fund
A strategic investor or ordinary
legal person becomes the Top10 None
shareholder due a stock issue.
Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu
Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology
Notes to top ten shareholder
Development Co., Ltd. and Shenzhen Shilihe Investment Co., Ltd. are related parties. The
relationship or "action in concert"
Company is not notified of other action-in-concert or related parties among the other holders
of current shares.
Top 10 holders of unconditional shares
Category of shares
Shareholder Amount of shares without sales restriction Category of
Amount
shares
Shenzhen Banglin Technologies RMB common
68,774,273 68,774,273
Development Co., Ltd. shares
Foreign shares
Shengjiu Investment Ltd. 37,845,591 listed in domestic 37,845,591
exchanges
RMB common
Huang Jupei 30,001,000 30,001,000
shares
Zhou Shijian 21,123,481 RMB common 21,123,481
44
China Fangda Group Co., Ltd. 2014 Annual Report
shares
Shenzhen Shilihe Investment Co., RMB common
17,860,992 17,860,992
Ltd. shares
RMB common
Yu Liandi 10,121,923 10,121,923
shares
National Social Insurance Portfolio RMB common
9,999,832 9,999,832
No.109 shares
RMB common
Jiang Jing 9,029,914 9,029,914
shares
ICBC-Lion Fund Stock Investment RMB common
8,513,474 8,513,474
Fund shares
Bank of Communication – Huaan
RMB common
Chuangxin Securities Investment 5,995,718 5,995,718
shares
Fund
No action-in-concert or related
Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and
parties among the top10
Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology
unconditional shareholders and
Development Co., Ltd. and Shenzhen Shilihe Investment Co., Ltd. are related parties. The
between the top10 unconditional
Company is not notified of other action-in-concert or related parties among the other holders
shareholders and the top10
of current shares.
shareholders
Huang Jupei holds 30,000,000 shares of the Company through GF Securities customer credit
transaction guarantee securities account; Zhou Shijian holds 21,123,481 shares of the
Participation by top-10 ordinary
Company through GF Securities customer credit transaction guarantee securities account, Yu
shareholders in financing bonds (if
Liandi holds 10,121,923 shares of the Company through GF Securities customer credit
any)
transaction guarantee securities account; Jiang Jing holds 9,024,914 shares of the Company
through Everbright Securities customer credit transaction guarantee securities account.
Agreed re-purchasing by the Company’s top 10 shareholders of common shares and top 10 shareholders of
unconditional common shares in the report period
2. Profile of the controlling shareholders
Legal person
Legal
Name of controlling Date of
representative/resp Organization code Registered capital Main business
shareholder establishment
onsible person
Industrial investment,
developing of electronic
Shenzhen Banglin
products, technical
Technologies Chen Jinwu June 7, 2001 72984005-5 RMB 30 million
consulting, domestic
Development Co., Ltd.
commerce, material
trading
45
China Fangda Group Co., Ltd. 2014 Annual Report
Future development
The Company will continue investment.
strategy
Operating result,
financial status and cash Banglin Technology's 2014 financial statements are not audited.
flow
Stock ownership of
other domestic and
overseas listed company
None
controlled or whose
shares are held by
controlling shareholders
No change in the controlling shareholder in the report period
3. Substantial controller of the Company
Natural person
Name of substantial controller Nationality Right of residence in another country or region
Xiong Jianming Chinese Yes
Occupation and position over the last five
Chair of the Board and president of the Company
years
Profiles of domestic and overseas listed
The controller held no share in other listed companies in the last ten years.
companies in which the controller held shares
No change in the actual shareholder in the report period
7. Chart of the controlling relationship
No controlling over the Company by the substantial controller through trust or other asset management
46
China Fangda Group Co., Ltd. 2014 Annual Report
4. The Company has no other legal person shareholders with over 10% of total shares
4. Statement on share increasing proposal raised by the shareholders or their
action-in-concert parties in the reporting period
Disclosure date of
Name of
Number of Proportion of Actual proportion Initial disclosure the share increase
shareholder/ Actual number of
shares to be shares to be of shares date of the share plan
action-in-concert shares increased
increased increased increased increase plan implementation
parties
completion
Shengjiu Investment
11,199,085 1.48%
Ltd.
47
China Fangda Group Co., Ltd. 2014 Annual Report
VII Particulars about the Directors, Supervisors, Senior Management
and Employees
1. Changes in shareholding of Directors, Supervisors and Senior Management
Number of
shares held Increased Decreased Number of
Starting
End date at shares in shares in shares held
Name Position Job status Sex Age date of the
of the term beginning this period this period at end of
term
of the (share) (share) the period
period
Xiong Chairman, March 31, March 31,
In office M 57 1,002,771 0 0 1,002,771
Jianming president 2014 2017
Director,
Wang March 31, March 31,
vice In office M 57 36,286 0 0 36,286
Shengguo 2014 2017
president
Xiong March 31, March 31,
Director In office M 46
Jianwei 2014 2017
Director,
Zhou secretary March 31, March 31,
In office M 52
Zhigang of the 2014 2017
Board
Huang Independe March 31, March 31,
In office M 52
Yaying nt director 2014 2017
Guo Independe March 31, March 31,
In office M 49
Wanda nt director 2014 2017
Independe March 31, March 31,
Lin Bin In office M 52
nt director 2014 2017
Supervisor
y
March 31, March 31,
Zhen Hua Committee In office F 55
2014 2017
meeting
convener
Yin March 31, March 31,
Supervisor In office M 46
Changjian 2014 2017
Zen March 31, March 31,
Supervisor In office M 45
Xiaowu 2014 2017
48
China Fangda Group Co., Ltd. 2014 Annual Report
Vice
March 31, March 31,
Lin Kebin president In office M 37
2014 2017
and CFO
Wei Vice March 31, March 31,
In office M 46
Yuexing president 2014 2017
Guo Independe March 25, March 25,
Resigned M 53
Jinlong nt director 2011 2014
Shao Independe March 25, March 25,
Resigned F 76
Hanqing nt director 2011 2014
March 25, March 25,
Yu Guoan Supervisor Resigned M 55
2011 2014
March 25, March 25,
Cao Naisi Supervisor Resigned F 36
2011 2014
Yang Vice March 25, March 25,
Resigned M 61
Xioazhuan president 2011 2014
Total -- -- -- -- -- -- 1,039,057 0 0 1,039,057
2. Office Description
Working experiences of current directors, supervisors and senior management in recent five years
Mr. Xiong Jianming: PHD Management; senior engineer; part-time professor of Beijing Institute of Civil
Engineering and Architecture and Nanchang University. He was once employed by Jiangxi Provincial
Machinery Design Academe, Administration Bureau of Shekou District of Shenzhen government, etc, deputy to
the 10th People’s Congress of Guangdong Province, deputy to the 2nd and 3rd People’s Congress of Shenzhen City.
He’s now assuming Chairman of the Board and President of the Company, member of the 5th Shenzhen
Committee of CPPCC, standing member of the 5th Nanshan Committee of CPPCC, founder and president of the
Shenzhen Semiconductor Lighting Association, vice president of the Federation of Shenzhen Industries, vice
president of the SGCC, president of the Nanshan Industry and Commerce Association and Honorary Chairman of
Shenzhen Nanshan Charity Society.
Mr. Wang Shengguo: Master degree; Visiting Scholar from University of Essen, senior engineer. He once
held such positions as Chief Engineer of Design Institute of the 2nd Heavy Machinery factory of Machinery
Industrial Ministry. Mr. Wang is now a Director and Vice President of the Company.
Mr. Xiong Jianwei: MBA. He is now a director of the Company.
Mr. Zhou Zhigang, bachelor’s degree. He is currently a Director, Secretary of Board, and head of the
Securities Dept and HR Dept.
Mr. Huang Yaying, is a master of China University of Political Science and Law, a law professor and
licensed lawyer. He is a senior visiting scholar of the Law School of UNSW and Hong Kong University. He is
now the president of the Law School and a member of the Diploma Appraisal Committee of Shenzhen University,
standing director of the China Academy of Arbitration Law and Institute of China Private International Law,
lawyer of the Guangdong Guoxin Law Firm and independent director of the Company.
Guo Wanda: Economic PH.D, research. As the executive deputy president of China Development Institute,
he has studied in macro-economy, industry policies and enterprise development strategies for years and provided
49
China Fangda Group Co., Ltd. 2014 Annual Report
consulting services. He is an independent director of the Company.
Lin Bin: economics (accounting) doctor. He is a professor of the Accounting Department of the Management
School of Sun Yat-Sen University, director of the Enterprise and Non-Profit Organization Research Center of Sun
Yat-Sen University, and was once the director of the Accounting Department of Sun Yat-Sen University and
MPACC Education Center. He is a member of the consultant panel of the enterprise internal control standard
committee of the Ministry of Finance, deputy president of Guangdong Auditor Society, vice president of the
Guangdong Internal Auditor Association.
Ms. Zhen Hua: Bachelor degree. She is now Supervisory Committee meeting convener, Chairwoman of
Trade Union, Director of President Office and head of the administration department of the Company.
Yin Changjian, bachelor's degree, is a CPA. He was only deputy general manager of Beijing branch of
Fangda Jianke and is now the deputy director of the audit and supervision dept. He is a staff supervisor.
Zeng Xiaowu, master's degree, is a senior engineer. He was once chief engineer, president of the design
institution and is now the vide technical supervisor
Mr. Lin Kebin, bachelor’s degree. At present he’s the Vice President and CFO of the Company.
Wei Yuexing, bachelor's degree, is an engineer. He is now vice president of the Company and general
manager of Fangda Jianke
Offices held at shareholders entities
Whether any
Starting date of End date of the remuneration is paid
Name Shareholder entity Office
the term term at the shareholder
entity
Xiong October 6,
Shengjiu Investment Ltd. Chairman No
Jianming 2011
Wang October 19,
Shenzhen Shilihe Investment Co., Ltd. Chairman No
Shengguo 2006
Wang General September 29,
Shenzhen Shilihe Investment Co., Ltd. No
Shengguo manager 2003
Xiong Jianwei Shenzhen Shilihe Investment Co., Ltd. Director June 12, 2001 No
October 19,
Zhou Zhigang Shenzhen Shilihe Investment Co., Ltd. Director No
2006
October 19,
Zhen Hua Shenzhen Shilihe Investment Co., Ltd. Supervisor No
2006
Office
None
description
Offices held at other entities
Whether any
Starting date of End date of the remuneration is paid
Name Entity name Office
the term term at the shareholder
entity
Huang Yaying Law School of Shenzhen University Dean July 1, 2009 Yes
50
China Fangda Group Co., Ltd. 2014 Annual Report
Huang Yaying Guangdong Guoxin Law Firm Lawyer May 1, 2009 No
Shenzhen Zhongzhuang Construction Independent
Huang Yaying May 1, 2013 Yes
Group Stock Co., Ltd. director
Independent October 1,
Huang Yaying Han's Laser Technology Co., Ltd. Yes
director 2013
Independent December 1,
Huang Yaying Shenzhen Airport Stock Co., Ltd. Yes
director 2014
Standing
General Development Research Institute
Guo Wanda deputy July 1, 2007 Yes
(China Shenzhen)
president
Shenzhen Baode Technology Group Stock Independent
Guo Wanda June 6, 2008 Yes
Co., Ltd. director
Shenzhen Meiyingseng Environmental Independent September 21, September 22,
Guo Wanda Yes
Protection Technology Co., Ltd. director 2010 2016
Sun Yat-Sen University Management October 1,
Lin Bin Professor Yes
Academy 1998
Guangzhou Baiyun International Airport Independent
Lin Bin June 27, 2013 June 26, 2016 Yes
Co., Ltd. director
Independent
Lin Bin Guangzhou Pearl River Beer Co., Ltd. June 19, 2012 Yes
director
Office
The above-mentioned three are independent directors of the Company.
description
3. Annual Remunerations of the Directors, Supervisors and Senior Executives
Decision making procedures, basis and actual payment of remunerations of the Directors, Supervisors and Senior
Executives
1. Remuneration schemes for directors and supervisors are proposed by the Remuneration and Assessment
Committee of the Board, and implemented upon approval of the Board and the Shareholders’ Meetings; the
remuneration schemes for executives are approved and implemented by the Board.
Remuneration for directors and supervisors are decided by the shareholders’ meeting. Remunerations for
executives are composed of wages and performance bonus as decided by the Board.
Payment on monthly basis
Remunerations of the Directors, Supervisors and Senior Executives of the Company During the reporting period
In RMB10,000
Total Unpaid
Total remuneration remuneration
Name Position Sex Age Job status
remuneration from the during the
shareholding reporting
51
China Fangda Group Co., Ltd. 2014 Annual Report
party period
Xiong Chairman,
M 57 In office 176.33 0 176.33
Jianming president
Wang Director, vice
M 57 In office 90.92 0 90.92
Shengguo president
Xiong Jianwei Director M 46 In office 78.55 0 78.55
Director,
Zhou Zhigang secretary of the M 52 In office 63.84 0 63.84
Board
Independent
Huang Yaying M 52 In office 8 0 8
director
Independent
Guo Wanda M 49 In office 6 0 6
director
Independent
Lin Bin M 52 In office 6 0 6
director
Supervisory
Committee
Zhen Hua F 55 In office 53.9 0 53.9
meeting
convener
Yin Changjian Supervisor M 46 In office 31.54 0 31.54
Zen Xiaowu Supervisor M 45 In office 66.46 0 66.46
Vice president
Lin Kebin M 37 In office 78.76 0 78.76
and CFO
Wei Yuexing Vice president M 46 In office 75.56 0 75.56
Independent
Guo Jinlong M 53 Resigned 2 0 2
director
Independent
Shao Hanqing F 76 Resigned 2 0 2
director
Cao Naisi Supervisor F 36 Resigned 41.61 0 41.61
Yu Guoan Supervisor M 55 Resigned 0.75 0 0.75
Yang
Vice president M 61 Resigned 43.75 0 43.75
Xioazhuan
Total -- -- -- -- 825.97 0 825.97
Equity incentive programs provided for the Directors, Supervisors and Senior Executives of the Company during
the reporting period
52
China Fangda Group Co., Ltd. 2014 Annual Report
4. Changes in the Directors, Supervisors and Senior Executives
Name Job Type Date Reason
Xiong Jianming Chairman, president Elected March 31, 2014 Expired
Wang Shengguo Director, vice president Elected March 31, 2014 Expired
Xiong Jianwei Director Elected March 31, 2014 Expired
Director, secretary of the
Zhou Zhigang Elected March 31, 2014 Expired
Board
Huang Yaying Independent director Elected March 31, 2014 Expired
Guo Wanda Independent director Elected March 31, 2014 Expired
Lin Bin Independent director Elected March 31, 2014 Expired
Supervisory Committee
Zhen Hua Elected March 31, 2014 Expired
meeting convener
Yin Changjian Supervisor Elected March 31, 2014 Expired
Zen Xiaowu Supervisor Elected March 31, 2014 Expired
Lin Kebin Vice president and CFO Engaged March 31, 2014 Expired
Wei Yuexing Vice president Engaged March 31, 2014 Expired
Guo Jinlong Independent director Leaving office March 31, 2014 Expired
Shao Hanqing Independent director Leaving office March 31, 2014 Expired
Yu Guoan Supervisor Leaving office March 31, 2014 Expired
Cao Naisi Supervisor Leaving office March 31, 2014 Expired
Yang Xioazhuan Vice president Leaving office March 31, 2014 Expired
5. Core technical team or personnel have remained unchanged in the report period.
6. Employees
Employees (by December 31, 2014)
Fangda Group (parent) Fangda Jianke Other Total
(main subsidiary) subsidiaries
Number of employees 72 1,588 1359 3,019
in position
Retired employees on 0 0 0 0
the Company’s expense
Categories of Fangda Group (parent) Fangda Jianke Other Total
professions (main subsidiary) subsidiaries
Production 0 552 824 1376
Sales & Marketing 0 63 99 162
53
China Fangda Group Co., Ltd. 2014 Annual Report
Technicians 0 258 137 395
Finance & Accounting 8 42 28 78
Executive 64 673 271 1008
Categories of education Fangda Group (parent) Fangda Jianke Other Total
(main subsidiary) subsidiaries
High school or below 22 677 1040 1739
College diploma 9 299 146 454
Bachelor 32 597 164 793
Master’s degree 8 14 9 31
Doctor’s degree 1 1 0 2
Staff remuneration policy: The Company’s staff remuneration comprises post wage, performance wage, allowance
54
China Fangda Group Co., Ltd. 2014 Annual Report
and annual bonus. The Company has set up an economic responsibility assessment system according to the
annual operation target and responsibility indicators for all departments. The performance wage is determined by
the economic indicators, management indicators, optimization indicators and internal control. The annual bonus
is determined by the Company's annual profit and fulfillment of targets set for various departments. The staff
remuneration and welfare will be adjusted according to the Company’s business operation and changes in the
local standard of living and price index.
Staff training plan: The Company has paid continuous attention to training and development of the staff and
introduces innovative learning as part of the long-term strategy. We provide training programs through different
channels and in different fields for different employees will help them fulfill their works, including new staff
training, on-the-job training, operation and management training programs. These programs have largely elevated
capabilities of the staff and underpin the success of the Company.
In the report period, the total of outsourced labor services amounted to 8.56 million hours, with a total income of
RMB256.69 million.
55
China Fangda Group Co., Ltd. 2014 Annual Report
VIII Corporation Governance
1. Overview
During the report period, the Company strictly complied with the Company Law, Securities Law,
Governance Standards for Listed Companies, Shenzhen Stock Exchange Share Listing Rules, Operation
Regulations for Listed Companies in the Main Board of Shenzhen Stock Exchange, continued to improve the
legal person governance structure and has formulated a series of internal management systems covering various
aspects. The Company has set up a comprehensive and effective internal control system in important decision
making, related transaction decision making, financial management, HR management, administration, purchase,
production and sales management, confidentiality and information disclosure.
By the end of the reporting period, the corporate governance complies with the Chinese laws and
requirements regarding corporate governance of listed companies issued by CSRC. The corporate governance
complies with the Company Law and related requirements of CSRC.
Implementation of corporate governance activities and establishment and implementation of insider registration
and management system
1. Revision of corporate governance
(1) According to the Company Law (2014 Revised), Guidelines for Articles of Association for Listed
Companies (2014 Revised), the Company revised the Articles of Associations, Shareholders’ Meeting Criteria,
Working Regulations of the Board of Directors and Regulations on External Investment, which were approved at
the 2nd extraordinary shareholders’ meeting in 2014 and 1st extraordinary shareholders’ meeting in 2015. The
announcements were published on China Securities Journal, Shanghai Securities Daily, Securities Times, HKCD
and www.cninfo.com.cn on September 12, 2014 and January 14, 2015.
(2) To regulate cash dividend distribution and improve distribution transparency, according to CSRC [2013]
No.43 Cash Dividend of Listed Companies, the Company revised profit distribution policies and terms in the
Articles of Associations and formulated the Shareholder Return Plan for 2015-2017, which were approved at the
8th meeting of the 7th Board of Directors and 1st extraordinary shareholders’ meeting in 2015.
2. Implementing cash dividend distribution plan
Approved at the Shareholders' Meeting 2013 held on March 31, 2014, the Company's profit distribution plan
for 2013 is distributing a cash dividend of RMB0.30 (tax-included) for every ten shares of all the shareholders
based on a total of 756,909,905 shares on December 31, 2013. The 2013 Share Equity Distribution
Implementation Announcement was published on China Securities Journal, Shanghai Securities Daily, Securities
Times, HKCD and www.cninfo.com.cn on April 8, 2014. 3. Establishing and implementing insider registration
management system
The Company has revised the “Information Insider Registration Scheme” according to the requirement of
CSRC in February 2012. The revised Information Insider Registration Scheme is published on
www.cninfo.com.cn.
No situation was found in the report period that any of the insiders had been trading the Company’s shares
taking advantages of the material information they could get access to, neither informed by the supervisory
56
China Fangda Group Co., Ltd. 2014 Annual Report
authorities regarding inspection or correction notice.
2. Annual and extraordinary shareholder meetings held during the report period
1. Annual shareholder meeting during the report period
Resoluti Date of Index for information
Meeting Date Proposal
on disclosure disclosure
(1) Review The Board of Directors’ Work Report
2013; (2) review the Supervisory Committee’s Work
Report 2013; (3) review the Annual Report 2013 and
the Summary; (4) review the Financial Settlement
The announcement of
Report 2013; (5) review the proposal of dividend
The Resolutions of
distribution for year 2013; (6) review the proposal
Shareholders’ Annual
about applying for integrated bank credit; (special All the
Meeting 2013 was
2013 Annual resolution); (7) review the proposal of providing proposal
March 31, April 1, published on China
Shareholder guarantee for the company’s fully-owned subsidiary; s are
2014 2014 Securities Journal,
Meeting (special resolution); (8) review the proposal of approve
Shanghai Securities
engaging the auditor for 2014; (9) review the d
Daily, Securities
remuneration plan for the 7th Board of Directors
Times, HKCD and
(including independent directors) and supervisory
www.cninfo.com.cn
committee; (10) review the proposal of re-electing the
Board of Directors of the Company; (11) review the
proposal of re-electing the Supervisory Committee of
the Company
2. Extraordinary shareholder meetings during the report period
Resoluti Date of Index for information
Meeting Date Proposal
on disclosure disclosure
1. Proposal on providing guarantee for the Company’s The announcement of 1st
1st fully-owned subsidiaries.(special resolution) 2. The All the Provisional Shareholders’
Provisional proposal of approving Shenzhen Fangda Property proposal Meeting 2014 was published
January January
Shareholder Development Co., Ltd.’s application for integrated s are on China Securities Journal,
24, 2014 25, 2014
s’ Meeting bank credit and providing of guarantee. (Special approve Shanghai Securities Daily,
2014 resolution) 3. Proposal of Investment in Fangda Town d Securities Times, HKCD and
renovation project. www.cninfo.com.cn.
1. The proposal about applying for integrated bank The announcement of 2nd
2nd All the
credit; (special resolution) 2. The proposal of Provisional Shareholders’
Provisional proposal
September providing guarantee for controlled company; (special September Meeting 2014 was published
Shareholder s are
11, 2014 resolution) 3. The proposal on revising the Articles of 12, 2014 on China Securities Journal,
s’ Meeting approve
Association (special resolution); 4. The proposal of Shanghai Securities Daily,
2014 d
Revising Shareholders' Meeting Criteria 5. The Securities Times, HKCD and
57
China Fangda Group Co., Ltd. 2014 Annual Report
proposal of Revising Working Regulations of the www.cninfo.com.cn.
Board of Directors.
3. No shareholder of preferred shares with recovered votes convened extraordinary shareholders meeting
3. Performance of independent directors during the report period
1. Independent directors presenting of board meetings and shareholders meetings in the report period
Independent directors’ presenting of board meetings
Time of board Absent for two
Name of independent Presented Presented by Presented by
meetings should Absent consecutive
director personally telecom proxy
have attended meetings
Huang Yaying 12 9 3 0 0 No
Guo Wanda 8 4 2 2 0 No
Lin Bin 8 5 2 1 0 No
Shao Hanqing 4 2 1 1 0 No
Guo Jinlong 4 2 1 1 0 No
Time of presence by independent
5
directors at shareholders’ meetings
No independent director was absent from two consecutive meetings of the Board of Director in the report period.
2. Independent directors made no objection on related issued of the Company in the report period.
3. Other statement for performance of independent directors
Adoption of suggestion proposed by independent directors
√ Yes □ No
Statement for suggestion adopted or not by the Company
(1) During the report period, the Company’s independent directors have paid attention to the Company’s
operation and performed their duties independent in accordance with applicable laws, regulations and Articles of
Association of the Company and have proposed many professional suggestions for improving the Company’s
system and routine operation decision-making. During the report period, independent directors have made
independent and just opinion on issues that need independent directors’ opinions, playing positive roles in
improving the Company’s supervisory system and protecting the rights and interests of the Company and
shareholders.
(2) Independent opinions issued in 2014
Type of Disclosure of
Time of independent
Name Issue involved independent the independent
opinion
opinion opinion
Shao March 7, 2014 Use of the Company’s fund by controlling shareholder In favor Yes
58
China Fangda Group Co., Ltd. 2014 Annual Report
Hanqing and other affiliates and guarantee made by the Company
Guo Internal control self evaluation report
Jinlong Independent opinion on the profit distribution plan for
Huang 2013
Yaying Independent opinion of engaging the auditor for 2014
Independent opinion on remuneration of directors and
senior executives in 2013
Announcement on Using Self-Owned Idle Fund for
Securities Investment
Independent opinions on re-election of the Board of
Directors and annual remuneration for directors and
supervisors
March 31, 2014 Independent opinions on employing senior management
Use of fund and external guarantees made controlling
August 21, 2014
shareholder and other affiliates in the first half of 2014
Independent opinions on private share issuance
Huang
Independent opinions on Related Transactions of Private
Yaying,
Share Issuance.
Guo
Opinions on the utilization report of previously raised
Wanda, Lin
December 23, 2014 capital
Bin
Opinions on revising the Articles of Association of
China Fangda Group Co., Ltd.
Independent opinions on the Shareholders’ Rewarding
Plan for the next three years
4. Performance of specific committees under the Board
(1) Performance of the Development Strategy Committee
During the report period, the Development Strategy Committee of the Company has performed its duties in
accordance with the Working Regulations for Development Strategy Committee and played its role in the
decision-making process of the Company. Two meetings were convened and details are disclosed as follows:
1. On March 7, 2014, the Company held the 6th meeting of the 6th Development Strategy Commission to
listen to the report on production and operation and production and operation plan for 2013 and 2014.
2. On August 22, 2014, the 1st meeting of the Development Strategy Committee of the 7th term of the Board
was held to view the Company’s production and operation in the first half of 2014 and studied the fulfillment of
the business plan in the first half of the year and places to be improved in the second half.
(2) Performance of the Auditing Committee
During the report period, five Auditing Committee meetings are held to review issues including the
arrangement of audit, regular financial reports, engaging the CFA, and use of the fund raised. Details of the
meetings are disclosed as follows:
1. On March 3, 2014, the 15th meeting of the Auditing Committee of the 6th term of the Board was held to
review the financial statements with the initial opinion issued by the CFA for 2013 and approved the auditor
report issued by the CFA. After the CFA issued to final auditor’s opinion, the Auditing Committee submitted the
59
China Fangda Group Co., Ltd. 2014 Annual Report
resolution on the annual financial statements to the Board and issued the summary report on the auditing of the
CFA for this year.
5. Performance of Supervisory Committee
Risks for the Company discovered by the Supervisory Committee
□ Yes √ No
No disagreement with supervisory issues by the Supervisory Committee during the report period.
6. Independence of the Company from the controlling shareholder in aspects of businesses,
personnel, assets, organizations, and accounting
The Company is completely separated from the controlling shareholder in aspects of businesses, personnel,
assets, organizations and accounting. The Company has its own completed businesses and capacity of independent
business operation.
In the aspect of business: the Company has its own purchasing, production, sales, and customer service system
which performing independently. There is not any material related transactions occurred with the controlling
shareholders.
In personnel: The labor management, personnel and salary management are operated independently from the
controlling shareholder. The senior managements take salaries from the Company and none of them takes senior
management position in the controlling party.
In assets: The Company owns its production, supplementary production system and accessory equipments
independently, and possesses its own industrial properties, non-patent technologies, and trademark.
In organization: The production and business operation, executive management, and department setting are
completely independent from the controlling shareholder. No situation of combined office exists. The Company
adjusts its organizing structure only for its own practical requirement of development and management.
In accounting: The company has its own independent accounting and auditing division, established
independent and completed accounting system and management rules, has its own bank account, and exercise its
liability of taxation independently.
7. No horizontal competition
8. Assessment and motivation of senior executives
The Company has implemented a remuneration system that combines post wage and performance bonus. The
wages and bonus are determined by on the assessment of senior executives’ innovation capabilities, general
quality, performance, fulfillment of profit and payment collection targets in the Implementation Regulations for
2014 Supervisory and Management Department Target Management and Assessment and Implementation
Regulations for 2014 Subordinate Unit Assessment.
60
China Fangda Group Co., Ltd. 2014 Annual Report
IX Internal Control
1. Internal Control Construction
In 2014, the Company has established a solid internal control system and examine key control activities in
accordance with the Enterprise Internal Control Regulations and Guidelines and Internal Control Evaluation
Guide issued by the Ministry of Finance. Moreover, the Company has urged subsidiaries and branches to establish
and improve the internal control system. The Company has inspected the internal control on business
management, capital management, assets management, investment management, information management and
HR management and make correction on key internal control points to ensure implementation of the internal
control system. Moreover, the Company has accelerated establishment and improvement of internal control
system among its subsidiaries and branches to formulate relate documents. In the report period, the Company
has established internal control system to cover related business and affairs. The existing system is complete,
reasonable and effective with enforceable documents, which will help the Company prevent risks in decision
making and management.
2. Boards statement on internal control responsibility
The Company has established a comprehensive and effective internal control system and reviews its
effectiveness. It is the responsibility of the Board of Directors to disclose the internal control evaluation report.
3. Basis for establishment of the internal financial statement control
The financial report internal control system is built based on the Company Law, Enterprise Accounting
Principles, Operation Regulations for Listed Companies in the Main Board of Shenzhen Stock Exchange and
Basic Regulations on Enterprise Internal Control and other applicable laws and regulations.
4. Internal control valuation report
Major internal control defects discovered in the report period in the internal control evaluation report
No major defect is found in the report period
Date of disclosure of the internal
March 27, 2015
control evaluation report
Disclosure of the internal control
The 2014 Internal Control Evaluation Report will be disclosed on www.cninfo.com.cn.
evaluation report
5. Internal Control Audit or Verification Report
Comments in the internal control audit report
We believe that China Fangda Group has maintained effective internal control on financial reports according to Basic Regulations
61
China Fangda Group Co., Ltd. 2014 Annual Report
on Enterprise Internal Control and related regulations on December 31, 2014.
Date of disclosure of the internal
March 27, 2015
control audit report
Source of disclosure of the internal
The 2014 Internal Control Audit Report will be disclosed on www.cninfo.com.cn.
control audit report
Non-standard internal control audit report by the CFA
Consistency between the internal control audit report and self-evaluation report
6. Establishment and implementation of the Retrospective Rules of Material False
Information in Annual Report
The Company has adopted the Retrospective Rules of Material False Information in Annual Report. It will
contribute to recognize and process material false in the procedures. The Company has been implementing the
regulations diligently and no such material false or omission was found in the report period.
62
China Fangda Group Co., Ltd. 2014 Annual Report
X Financial Statements
1. Auditors report
Type Standard opinion auditor’s report
Issued on March 25, 2015
Auditor Grant Thornton (special general partner)
Report No. 致同审字（2015）第 350ZA0071 号
CPA names Lin Kaiqin and Li Chunmei
Auditors report
致同审字（2015）第350ZA0071号
To the shareholders of China Fangda Group Co., Ltd.:
We have audited the Financial Statements of China Fangda Group Co., Ltd. (“Fangda Group”) attached
hereafter, including the Balance Sheet and Consolidated Balance Sheet ended December 31, 2014 and the Income
Statement, Consolidated Income Statement, Cash Flow Statement, Consolidated Cash Flow Statement, Statement
on Change of Shareholders’ Equity, Consolidated Statement on Change of Shareholders’ Equity of the year 2014,
as well as the Notes to the Financial Statements.
1. Executives responsibilities on the Financial Statements
Preparing of the Financial Statements according to Enterprise Accounting Standard is the responsibility of
the management of the Company. This responsibility includes: (1) to prepare the financial statements according to
the accounting standard, and ensure its fair reflection of business position; (2) to design, implement and maintain
the internal control system related to producing of the Financial Statements, to prevent the Financial Statements
from major false presentation due to cheating or error.
2. Responsibilities of the CPA
Our responsibility is to express an auditing opinion on the financial statements basing on our audit. We
carried out the auditing works with compliance to Chinese CPA Auditing Standard, which requires us to plan
and implement our works on the basis of professional ethic standards, and obtain reasonable guarantee that the
Financial Statements are free of major false statements.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the
risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, we consider the internal control relevant to the entity’s preparation of financial statements in order to
design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the
appropriateness of the accounting polices used and the reasonableness of the accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
63
China Fangda Group Co., Ltd. 2014 Annual Report
audit opinion.
3. Auditors Opinions
We believe that Fangda Group has been following with the Enterprise Accounting Standard in preparing of
the Financial Statements. The Financial Statements is reflecting, in all important aspects, the financial situation of
Fangda Group as of December 31, 2014, and the business performance and cash flow of year 2014.
Grand Thornton CPA CPA China Lin Kaiqin
(limited liability partnership)
CPA China Li Chunmei
Beijing, China March 25, 2015
2. Financial statements
Unit for statements in notes to financial statements: RMB yuan
1. Consolidated Balance Sheet
Prepared by: China Fangda Group Co., Ltd.
In RMB
Items Closing balance Ending balance
Current asset:
Monetary capital 212,430,798.87 333,876,921.97
Settlement provision
Outgoing call loan
Financial assets measured at fair
value with variations accounted into 13,410,790.00
current income account
Derivative financial assets
Notes receivable 83,325,725.70 21,898,770.43
Account receivable 1,105,242,251.46 898,780,981.93
Prepayment 29,234,231.49 28,364,016.21
64
China Fangda Group Co., Ltd. 2014 Annual Report
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance
contracts receivable
Interest receivable 36,387.50
Dividend receivable
Other receivables at the end of
48,950,647.67 66,298,730.17
the period
Repurchasing of financial assets
Inventory 982,441,187.05 428,537,851.82
Assets held for sales
Non-current assets due in 1 year
Other current assets 234,986,107.72
Total current assets 2,710,021,739.96 1,777,793,660.03
Non-current assets:
Disburse of loans
Sellable financial assets
Investment held until mature
Long-term receivable
Long-term share equity
11,048,660.43 9,994,565.55
investment
Investment real estate 226,279,523.39 195,249,069.13
Fixed assets 489,714,684.63 462,930,269.98
Construction in process 341,749.17 940,841.00
Engineering materials
Disposal of fixed assets 26,918.21 177,298.11
Productive biological assets
Gas & petrol
Intangible assets 98,947,331.09 91,527,650.52
R&D expense
Goodwill 26,279,395.89
Long-term amortizable expenses 4,119,362.63 3,799,354.79
Deferred income tax assets 52,616,656.38 41,166,043.56
Other non-current assets 43,323,878.63 15,978,789.90
Total of non-current assets 952,698,160.45 821,763,882.54
65
China Fangda Group Co., Ltd. 2014 Annual Report
Total of assets 3,662,719,900.41 2,599,557,542.57
Current liabilities
Short-term loans 1,100,000,000.00 369,000,000.00
Loans from Central Bank
Deposit received and held for
others
Call loan received
Financial liabilities measured at
fair value with variations accounted into
current income account
Derivative financial liabilities
Notes payable 227,266,485.57 188,570,850.63
Account payable 685,108,346.73 489,216,140.32
Prepayment received 122,285,231.14 168,386,251.94
Selling of repurchased financial
assets
Fees and commissions payable
Employees’ wage payable 41,703,314.26 30,182,851.80
Taxes payable 58,696,926.25 44,839,947.77
Interest payable 2,055,911.11 689,153.75
Dividend payable
Other payables 47,425,682.44 41,687,580.72
Reinsurance fee payable
Insurance contract provision
Entrusted trading of securities
Entrusted selling of securities
Liabilities held for sales
Non-current liabilities due in 1
6,000,000.00
year
Other current liabilities
Total current liabilities 2,290,541,897.50 1,332,572,776.93
Non-current liabilities:
Long-term loans
Bond payable
Including: preferred share
66
China Fangda Group Co., Ltd. 2014 Annual Report
Perpetual capital
securities
Long-term payable 6,000,000.00
Employees’ wage payable
Special payables
Anticipated liabilities 5,859,045.98
Deferred earning 10,049,892.04 10,255,823.93
Deferred income tax liabilities 49,734,436.90 40,656,763.97
Other non-current liabilities
Total of non-current liabilities 71,643,374.92 50,912,587.90
Total liabilities 2,362,185,272.42 1,383,485,364.83
Owner’s equity:
Share capital 756,909,905.00 756,909,905.00
Other interest tools
Including: preferred share
Perpetual capital
securities
Capital reserves 79,099,220.38 79,099,220.38
Less: Shares in stock
Other miscellaneous income 91,831.63 91,831.63
Special reserves
Surplus reserves 48,842,080.76 46,389,142.21
Common risk provisions
Retained profit 349,987,825.69 278,149,631.63
Total of owner’s equity belong to the
1,234,930,863.46 1,160,639,730.85
parent company
Minor shareholders’ equity 65,603,764.53 55,432,446.89
Total of owners’ equity 1,300,534,627.99 1,216,072,177.74
Total liabilities and shareholders’ equity 3,662,719,900.41 2,599,557,542.57
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Chen Yonggang
2. Balance Sheet of the Parent Company
In RMB
Items Closing balance Ending balance
67
China Fangda Group Co., Ltd. 2014 Annual Report
Current asset:
Monetary capital 22,256,065.49 68,223,808.76
Financial assets measured at fair
value with variations accounted into
current income account
Derivative financial assets
Notes receivable
Account receivable 511,660.60 604,459.49
Prepayment 50,903.86 218,984.07
Interest receivable
Dividend receivable 28,639,627.17 39,356,000.00
Other receivables at the end of
254,604,163.79 571,620,659.73
the period
Inventory
Assets held for sales
Non-current assets due in 1 year
Other current assets 31,005,620.01
Total current assets 337,068,040.92 680,023,912.05
Non-current assets:
Sellable financial assets
Investment held until mature
Long-term receivable
Long-term share equity
1,130,674,559.01 719,728,311.13
investment
Investment real estate 198,513,586.15 174,778,756.62
Fixed assets 60,145,112.89 48,117,849.19
Construction in process 914,126.00
Engineering materials
Disposal of fixed assets
Productive biological assets
Gas & petrol
Intangible assets 2,256,575.64 1,351,845.98
R&D expense
Goodwill
Long-term amortizable expenses 81,367.47 50,314.43
68
China Fangda Group Co., Ltd. 2014 Annual Report
Deferred income tax assets 22,623,560.72 12,342,430.37
Other non-current assets 220,000,000.00
Total of non-current assets 1,634,294,761.88 957,283,633.72
Total of assets 1,971,362,802.80 1,637,307,545.77
Current liabilities
Short-term loans 350,000,000.00 104,000,000.00
Financial liabilities measured at
fair value with variations accounted into
current income account
Derivative financial liabilities
Notes payable
Account payable 606,941.85 1,849,090.36
Prepayment received 832,772.45 798,586.70
Employees’ wage payable 1,956,875.76 1,881,681.86
Taxes payable 567,424.56 260,761.30
Interest payable 659,266.67 193,930.00
Dividend payable
Other payables 270,281,330.40 192,765,065.68
Liabilities held for sales
Non-current liabilities due in 1
year
Other current liabilities
Total current liabilities 624,904,611.69 301,749,115.90
Non-current liabilities:
Long-term loans
Bond payable
Including: preferred share
Perpetual capital
securities
Long-term payable
Employees’ wage payable
Special payables
Anticipated liabilities
Deferred earning
Deferred income tax liabilities 97,693,047.19 88,615,374.26
69
China Fangda Group Co., Ltd. 2014 Annual Report
Other non-current liabilities
Total of non-current liabilities 97,693,047.19 88,615,374.26
Total liabilities 722,597,658.88 390,364,490.16
Owner’s equity:
Share capital 756,909,905.00 756,909,905.00
Other interest tools
Including: preferred share
Perpetual capital
securities
Capital reserves 38,598,565.00 38,598,565.00
Less: Shares in stock
Other miscellaneous income 91,831.63 91,831.63
Special reserves
Surplus reserves 48,842,080.76 46,389,142.21
Retained profit 404,322,761.53 404,953,611.77
Total of owners’ equity 1,248,765,143.92 1,246,943,055.61
Total liabilities and shareholders’ equity 1,971,362,802.80 1,637,307,545.77
3. Consolidated Income Statement
In RMB
Items Amount occurred in the current period Occurred in previous period
1. Total revenue 1,938,324,435.51 1,747,620,845.74
Incl. Business income 1,938,324,435.51 1,747,620,845.74
Interest income
Insurance fee earned
Fee and commission
received
2. Total business cost 1,867,564,531.44 1,670,170,512.18
Incl. Business cost 1,590,836,786.02 1,425,369,204.42
Interest expense
Fee and commission paid
Insurance discharge
payment
Net claim amount paid
Net insurance policy
70
China Fangda Group Co., Ltd. 2014 Annual Report
reserves provided
Insurance policy dividend
paid
Reinsurance expenses
Business tax and surcharge 22,855,639.99 23,272,313.84
Sales expense 44,684,306.70 37,383,041.60
Administrative expense 152,584,713.60 127,254,247.26
Financial expenses 29,165,058.80 23,108,586.39
Asset impairment loss 27,438,026.33 33,783,118.67
Plus: gains from change of fair
32,044,747.10 16,647,859.74
value (“-“ for loss)
Investment gains (“-“ for loss) 1,720,693.98 300,866.92
Incl. Investment gains from
1,054,094.88 -5,434.45
affiliates and joint ventures
Exchange gains (“-“ for loss)
3. Operational profit (“-“ for loss) 104,525,345.15 94,399,060.22
Plus: non-operational income 16,281,459.18 7,595,856.24
Including: Gain/loss of
3,162,999.40 154,552.62
non-current assets
Less: non-operational expenditure 10,623,712.10 1,344,375.30
Incl. Loss from disposal of
1,709,152.13 617,106.70
non-current assets
4. Gross profit (“-“ for loss) 110,183,092.23 100,650,541.16
Less: Income tax expenses 17,493,747.57 19,249,761.60
5. Net profit (“-“ for net loss) 92,689,344.66 81,400,779.56
Net profit attributable to the
96,998,429.76 85,676,863.78
owners of parent company
Minor shareholders’ equity -4,309,085.10 -4,276,084.22
6. After-tax net of other miscellaneous
-1,108,815.63
income
After-tax net of other miscellaneous
-1,108,815.63
income attributed to parent owner
(1) Other comprehensive gain
cannot be classified into gain/loss
1. Changes in net liabilities
or net assets of re-measured defined
benefit program
71
China Fangda Group Co., Ltd. 2014 Annual Report
2. Share enjoyed in other
miscellaneous income cannot be
classified into gain/loss under the equity
method
(2) Other comprehensive gain that
-1,108,815.63
will be classified into gain/loss
1. Share enjoyed in other
miscellaneous income that will be
classified into gain/loss under the equity
method
2. Gain/loss caused by
changes in the fair value of financial asset
for sales
3 Gain/loss caused by
reclassification of held-to-maturity
investment to financial asset for sales
4. Effective part of cash flow
hedging gain/loss
(5) Translation difference of
foreign exchange statement
6. Others -1,108,815.63
After-tax net of other miscellaneous
income attributed to minority
shareholders
7. Total of misc. incomes 92,689,344.66 80,291,963.93
Total of misc. incomes attributable
96,998,429.76 84,568,048.15
to the owners of the parent company
Total misc gains attributable to the
-4,309,085.10 -4,276,084.22
minor shareholders
8. Earnings per share:
(1) Basic earnings per share 0.13 0.11
(2) Diluted earnings per share 0.13 0.11
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Chen Yonggang
4. Income Statement of the Parent Company
In RMB
Items Amount occurred in the current period Occurred in previous period
72
China Fangda Group Co., Ltd. 2014 Annual Report
1. Turnover 29,609,371.13 45,659,921.07
Less: Operation cost 5,669,281.13 10,980,932.52
Business tax and surcharge 2,420,213.38 3,415,837.54
Sales expense
Administrative expense 24,285,538.55 22,773,847.97
Financial expenses 13,398,214.90 10,054,285.40
Asset impairment loss 27,045,993.77 -3,228,252.95
Plus: gains from change of fair
34,897,632.10 16,647,859.74
value (“-“ for loss)
Investment gains (“-“ for
29,805,392.25 -5,434.45
loss)
Incl. Investment gains from
1,054,094.88 -5,434.45
affiliates and joint ventures
2. Operational profit (“-“ for loss) 21,493,153.75 18,305,695.88
Plus: non-operational income 2,441,486.71 193,478,232.51
Incl. Gain from disposal of
22,719.41 4,918.81
non-current assets
Less: non-operational expenditure 608,712.42 442,064.12
Incl. Loss from disposal of
207,212.42 37,992.07
non-current assets
3. Gross profit (“-“ for loss) 23,325,928.04 211,341,864.27
Less: Income tax expenses -1,203,457.42 52,395,871.61
4. Net profit (“-“ for net loss) 24,529,385.46 158,945,992.66
5. After-tax net of other miscellaneous
-1,108,815.63
income
(1) Other comprehensive gain
cannot be classified into gain/loss
1. Changes in net liabilities
or net assets of re-measured defined
benefit program
2. Share enjoyed in other
miscellaneous income cannot be
classified into gain/loss under the equity
method
(2) Other comprehensive gain that
-1,108,815.63
will be classified into gain/loss
1. Share enjoyed in other
73
China Fangda Group Co., Ltd. 2014 Annual Report
miscellaneous income that will be
classified into gain/loss under the equity
method
2. Gain/loss caused by
changes in the fair value of financial
asset for sale
(3) Gain/loss caused by
reclassification of held-to-maturity
investment to financial asset for sales
(4) Effective part of cash
flow hedging gain/loss
(5) Translation difference
of foreign exchange statement
6. Others -1,108,815.63
(6) Total of misc. incomes 24,529,385.46 157,837,177.03
(7) Earnings per share:
(1) Basic earnings per share
(2) Diluted earnings per share
5. Consolidated Cash Flow Statement
In RMB
Items Amount occurred in the current period Occurred in previous period
1. Net cash flow from business
operations:
Cash received from sales of
1,651,025,342.09 1,763,447,209.35
products and providing of services
Net increase of customer deposits
and capital kept for brother company
Net increase of loans from central
bank
Net increase of inter-bank loans
from other financial bodies
Cash received against original
insurance contract
Net cash received from
reinsurance business
Net increase of client deposit and
investment
74
China Fangda Group Co., Ltd. 2014 Annual Report
Net increase in financial assets
measured at fair value with variations
accounted into current income account
Cash received as interest,
processing fee, and commission
Net increase of inter-bank fund
received
Net increase of repurchasing
business
Tax refunded 1,735,709.16 1,935,388.44
Other cash received from
31,286,645.67 41,052,740.68
business operation
Sub-total of cash inflow from business
1,684,047,696.92 1,806,435,338.47
operations
Cash paid for purchasing
1,796,240,670.15 1,313,329,311.49
products and services
Net increase of client trade and
advance
Net increase of savings in central
bank and brother company
Cash paid for original contract
claim
Cash paid for interest, processing
fee and commission
Cash paid for policy dividend
Cash paid to and for the staff 225,245,085.75 167,796,650.09
Taxes paid 86,882,633.93 78,014,776.44
Other cash paid for business
133,573,236.53 90,749,980.14
activities
Sub-total of cash outflow from business
2,241,941,626.36 1,649,890,718.16
operations
Cash flow generated by business
-557,893,929.44 156,544,620.31
operations, net
2. Cash flow generated by investment:
Cash received from investment
294,000,000.00 120,000,000.00
recovery
Cash received as investment profit 2,144,844.81 306,301.37
Net cash retrieved from disposal 5,912,795.35 179,704.00
75
China Fangda Group Co., Ltd. 2014 Annual Report
of fixed assets, intangible assets, and
other long-term assets
Net cash received from disposal
of subsidiaries or other operational units
Other investment-related cash
65,500.00 429,055.00
received
Sub-total of cash inflow generated from
302,123,140.16 120,915,060.37
investment
Cash paid for construction of
fixed assets, intangible assets and other 33,875,128.34 40,911,829.63
long-term assets
Cash paid as investment 538,263,675.00 130,000,000.00
Net increase of loan against
pledge
Net cash paid for acquiring
15,702,424.87
subsidiaries and other operational units
Other cash paid for investment 331,500.00 1,659,058.00
Subtotal of cash outflows 588,172,728.21 172,570,887.63
Cash flow generated by investment
-286,049,588.05 -51,655,827.26
activities, net
3. Cash flow generated by financing
activities:
Cash received from investment
Incl. Cash received from
investment attracted by subsidiaries
from minority shareholders
Cash received from borrowed
1,303,817,100.01 529,000,000.00
loans
Cash received from bond placing
Other cash received from
financing activities
Subtotal of cash inflow from financing
1,303,817,100.01 529,000,000.00
activities
Cash paid to repay debts 575,000,000.00 540,000,000.00
Cash paid as dividend, profit, or
67,732,507.84 48,354,192.64
interests
Incl. Dividend and profit paid by
subsidiaries to minority shareholders
76
China Fangda Group Co., Ltd. 2014 Annual Report
Other cash paid for financing
activities
Subtotal of cash outflow from financing
642,732,507.84 588,354,192.64
activities
Net cash flow generated by financing
661,084,592.17 -59,354,192.64
activities
4. Influence of exchange rate changes
259,902.13 -464,717.89
on cash and cash equivalents
5. Net increase in cash and cash
-182,599,023.19 45,069,882.52
equivalents
Plus: Balance of cash and cash
285,237,255.38 240,167,372.86
equivalents at the beginning of term
6. Balance of cash and cash equivalents
102,638,232.19 285,237,255.38
at the end of the period
6. Cash Flow Statement of the Parent Company
In RMB
Items Amount occurred in the current period Occurred in previous period
1. Net cash flow from business
operations:
Cash received from sales of
25,532,652.79 44,496,139.39
products and providing of services
Tax refunded
Other cash received from
535,560,936.32 580,085,321.10
business operation
Sub-total of cash inflow from business
561,093,589.11 624,581,460.49
operations
Cash paid for purchasing
6,265,876.89 12,790,698.85
products and services
Cash paid to and for the staff 12,900,103.54 10,045,800.12
Taxes paid 2,806,998.73 4,659,170.87
Other cash paid for business
144,910,876.80 217,012,897.35
activities
Sub-total of cash outflow from business
166,883,855.96 244,508,567.19
operations
Cash flow generated by business
394,209,733.15 380,072,893.30
operations, net
77
China Fangda Group Co., Ltd. 2014 Annual Report
2. Cash flow generated by investment:
Cash received from investment
20,000,000.00
recovery
Cash received as investment profit 39,860,211.87
Net cash retrieved from disposal
of fixed assets, intangible assets, and 66,000.00 33,241,974.20
other long-term assets
Net cash received from disposal
of subsidiaries or other operational units
Other investment-related cash
received
Sub-total of cash inflow generated from
59,926,211.87 33,241,974.20
investment
Cash paid for construction of
fixed assets, intangible assets and other 3,257,461.79 1,359,102.96
long-term assets
Cash paid as investment 707,011,633.00 50,000,000.00
Net cash paid for acquiring
subsidiaries and other operational units
Other cash paid for investment
Subtotal of cash outflows 710,269,094.79 51,359,102.96
Cash flow generated by investment
-650,342,882.92 -18,117,128.76
activities, net
3. Cash flow generated by financing
activities:
Cash received from investment
Cash received from borrowed
446,000,000.00 194,000,000.00
loans
Cash received from bond placing
Other cash received from
financing activities
Subtotal of cash inflow from financing
446,000,000.00 194,000,000.00
activities
Cash paid to repay debts 200,000,000.00 470,000,000.00
Cash paid as dividend, profit, or
35,741,367.15 43,525,867.31
interests
Other cash paid for financing
activities
78
China Fangda Group Co., Ltd. 2014 Annual Report
Subtotal of cash outflow from financing
235,741,367.15 513,525,867.31
activities
Net cash flow generated by financing
210,258,632.85 -319,525,867.31
activities
4. Influence of exchange rate changes
-93,226.35 3,306.69
on cash and cash equivalents
5. Net increase in cash and cash
-45,967,743.27 42,433,203.92
equivalents
Plus: Balance of cash and cash
67,973,808.76 25,540,604.84
equivalents at the beginning of term
6. Balance of cash and cash equivalents
22,006,065.49 67,973,808.76
at the end of the period
7. Statement of Change in Owners Equity (Consolidated)
Amount of the Current Term
In RMB
Current period
Owners’ Equity Attributable to the Parent Company
Other interest tools
Minor
Perpet Total of
Items Other Commo
ual Less: shareho
Share Prefer Capital miscella Special Surplus n risk Retaine owners’
capita Other Shares lders’
capital red reserves neous reserves reserves provisio d profit equity
l s in stock equity
shares income ns
securi
ties
756,90 1,216,0
1. Balance at the 79,099, 91,831. 46,389, 278,149 55,432,
9,905. 72,177.
end of last period 220.38 63 142.21 ,631.63 446.89
00 74
Plus:
Changes in
accounting
policies
Correction of
previous errors
Under
common control
Others
79
China Fangda Group Co., Ltd. 2014 Annual Report
2. Balance at the 756,90 1,216,0
79,099, 91,831. 46,389, 278,149 55,432,
beginning of 9,905. 72,177.
220.38 63 142.21 ,631.63 446.89
current period 00 74
3. Amount of
change in current 2,452,9 71,838, 10,171, 84,462,
term (“-“ for 38.55 194.06 317.64 450.25
decrease)
(1) Total of misc. 96,998, -4,309,0 92,689,
incomes 429.76 85.10 344.66
(2) Investment or
16,000, 16,000,
decreasing of
000.00 000.00
capital by owners
1. Common shares
16,000, 16,000,
invested by
000.00 000.00
shareholders
2. Capital invested
by other equity
tool holders
3. Amount of
shares paid and
accounted as
owners’ equity
4. Others
(3) Profit 2,452,9 -25,160, -22,707,
allotment 38.55 235.70 297.15
1. Providing of 2,452,9 -2,452,9
surplus reserves 38.55 38.55
2. Common risk
provision
3. Allotment to the
-22,707, -22,707,
owners (or
297.15 297.15
shareholders)
4. Others
(4) Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
80
China Fangda Group Co., Ltd. 2014 Annual Report
surplus reserves
(or to capital
shares)
3. Making up
losses by surplus
reserves
4. Others
(5) Special
reserves
1. Provided this
year
2. Used this term
-1,519,5 -1,519,5
(6) Others
97.26 97.26
756,90 1,300,5
4. Balance at the 79,099, 91,831. 48,842, 349,987 65,603,
9,905. 34,627.
end of this period 220.38 63 080.76 ,825.69 764.53
00 99
Amount of the Previous Term
In RMB
Last period
Owners’ Equity Attributable to the Parent Company
Other interest tools
Perpet Minor
Other Commo Total of
Items Less: shareho
ual owners’
Share Prefer Capital miscella Special Surplus n risk Retaine
Shares lders’
capita Other equity
capital red reserves neous reserves reserves provisio d profit
in stock equity
l s
shares income ns
securi
ties
756,90 1,158,3
1. Balance at the 79,099, 1,200,6 30,494, 230,907 59,708,
9,905. 20,726.
end of last period 220.38 47.26 542.94 ,879.99 531.11
00 68
Plus:
Changes in
accounting
policies
Correction of
previous errors
Under
81
China Fangda Group Co., Ltd. 2014 Annual Report
common control
Others
2. Balance at the 756,90 1,158,3
79,099, 1,200,6 30,494, 230,907 59,708,
beginning of 9,905. 20,726.
220.38 47.26 542.94 ,879.99 531.11
current period 00 68
3. Amount of
change in current -1,108,8 15,894, 47,241, -4,276, 57,751,
term (“-“ for 15.63 599.27 751.64 084.22 451.06
decrease)
(1) Total of misc. -1,108,8 85,676, -4,276, 80,291,
incomes 15.63 863.78 084.22 963.93
(2) Investment or
decreasing of
capital by owners
1. Common shares
invested by
shareholders
2. Capital invested
by other equity
tool holders
3. Amount of
shares paid and
accounted as
owners’ equity
4. Others
(3) Profit 15,894, -38,435, -22,540,
allotment 599.27 112.14 512.87
1. Providing of 15,894, -15,894,
surplus reserves 599.27 599.27
2. Common risk -22,540, -22,540,
provision 512.87 512.87
3. Allotment to the
owners (or
shareholders)
4. Others
(4) Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
82
China Fangda Group Co., Ltd. 2014 Annual Report
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
shares)
3. Making up
losses by surplus
reserves
4. Others
(5) Special
reserves
1. Provided this
year
2. Used this term
(6) Others
756,90 1,216,0
4. Balance at the 79,099, 91,831. 46,389, 278,149 55,432,
9,905. 72,177.
end of this period 220.38 63 142.21 ,631.63 446.89
00 74
8. Statement of Change in Owners Equity (Parent Company)
Amount of the Current Term
In RMB
Current period
Other interest tools
Perpetu Other
Less: Total of
Items Share al Capital miscellan Special Surplus Retaine
Preferre Shares in owners’
capital capital Others reserves eous reserves reserves d profit
d shares stock equity
securiti income
es
1. Balance at the 756,909, 38,598,56 46,389,14 404,953 1,246,943
91,831.63
end of last period 905.00 5.00 2.21 ,611.77 ,055.61
Plus:
Changes in
accounting
policies
Correction of
previous errors
Others
83
China Fangda Group Co., Ltd. 2014 Annual Report
2. Balance at the
756,909, 38,598,56 46,389,14 404,953 1,246,943
beginning of 91,831.63
905.00 5.00 2.21 ,611.77 ,055.61
current period
3. Amount of
change in current 2,452,938 -630,85 1,822,088
term (“-“ for .55 0.24 .31
decrease)
(1) Total of misc. 24,529, 24,529,38
incomes 385.46 5.46
(2) Investment or
decreasing of
capital by owners
1. Common shares
invested by
shareholders
2. Capital invested
by other equity
tool holders
3. Amount of
shares paid and
accounted as
owners’ equity
4. Others
(3) Profit 2,452,938 -25,160, -22,707,2
allotment .55 235.70 97.15
1. Providing of 2,452,938 -2,452,9
surplus reserves .55 38.55
2. Allotment to the
-22,707, -22,707,2
owners (or
297.15 97.15
shareholders)
3. Others
(4) Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
84
China Fangda Group Co., Ltd. 2014 Annual Report
shares)
3. Making up
losses by surplus
reserves
4. Others
(5) Special
reserves
1. Provided this
year
2. Used this term
(6) Others
4. Balance at the 756,909, 38,598,56 48,842,08 404,322 1,248,765
91,831.63
end of this period 905.00 5.00 0.76 ,761.53 ,143.92
Amount of the Previous Term
In RMB
Last period
Other interest tools
Perpetu Other
Less: Total of
Items Share al Capital miscellan Special Surplus Retaine
Preferre Shares in owners’
capital capital Others reserves eous reserves reserves d profit
d shares stock equity
securiti income
es
1. Balance at the 756,909, 38,598,56 1,200,647 30,494,54 284,442 1,111,646
end of last period 905.00 5.00 .26 2.94 ,731.25 ,391.45
Plus:
Changes in
accounting
policies
Correction of
previous errors
Others
2. Balance at the
756,909, 38,598,56 1,200,647 30,494,54 284,442 1,111,646
beginning of
905.00 5.00 .26 2.94 ,731.25 ,391.45
current period
3. Amount of
change in current -1,108,81 15,894,59 120,510 135,296,6
term (“-“ for 5.63 9.27 ,880.52 64.16
decrease)
85
China Fangda Group Co., Ltd. 2014 Annual Report
(1) Total of misc. -1,108,81 158,945 157,837,1
incomes 5.63 ,992.66 77.03
(2) Investment or
decreasing of
capital by owners
1. Common shares
invested by
shareholders
2. Capital invested
by other equity
tool holders
3. Amount of
shares paid and
accounted as
owners’ equity
4. Others
(3) Profit 15,894,59 -38,435, -22,540,5
allotment 9.27 112.14 12.87
1. Providing of 15,894,59 -15,894,
surplus reserves 9.27 599.27
2. Allotment to the
-22,540, -22,540,5
owners (or
512.87 12.87
shareholders)
3. Others
(4) Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
shares)
3. Making up
losses by surplus
reserves
4. Others
(5) Special
reserves
86
China Fangda Group Co., Ltd. 2014 Annual Report
1. Provided this
year
2. Used this term
(6) Others
4. Balance at the 756,909, 38,598,56 46,389,14 404,953 1,246,943
91,831.63
end of this period 905.00 5.00 2.21 ,611.77 ,055.61
III. General Information
China Fangda Group Co., Ltd. (hereinafter referred to as “the Company” or "Fangda") was established by
restructuring Shenzhen Fangda Construction Material Co., Ltd. with the approval Shenzhen Government Office
Doc. No. (1995) in October 1995. The Registration No. of the Company’s business license is:
440301501124785; with a registered capital of RMB756,909,905; registered address: Fangda Building, Kejinan
Road 12, High-tech Zone, Shenzhen. Mr. Xiong Jianming is the legal representative.
The Company issued foreign currency shares (B shares) and local currency shares (A shares) and listed in
November 1995 and April 1996 respectively in Shenzhen Stock Exchange.
The Company has established a corporate governance structure that comprises shareholders’ meeting, board of
directors and supervisory committee. Currently, the Company sets up the President Office, Administrative
Department, HR Department, Enterprise Management Department, Financial Department, Audit and Supervisory
Department, Securities Department, Technology Department and IT Department and has established subsidiaries
including Fangda Decoration, Fangda Automatic, Fangda New Material, Shenyang Fangda and Fangda Property.
Business nature and main business activities of the Company and its subsidiaries (collectively referred to "the
Group") include (1) curtain wall segment, production and sales of curtain wall materials, construction curtain wall
design, production and installation; (2) rail transport segment, assembly and processing of metro screen doors; (3)
real estate development segment, develop and operate real estate projects on land with legal land use rights;
property management; (4) new energy segment, R&D, installation and sales of PV devices, design and
construction of PV power plants; R&D, design, production, sales and installation of lighting electric accessories
and other lighting devices, LED products and hardware products.
The financial statements and notes are approved at the 9th meeting of the 7th term of the Board held on March 25,
2015.
The consolidation scope of financial statements in this report period includes the Company and all subsidiaries.
New entities incorporated in this report period include Shenzhen Fangda New Energy Co., Ltd., Guangdong
Fangda SOZN Lighting Co., Ltd., Shihui International Holding Co., Ltd. During the report period, subsidiary
Shenzhen Fangda Yide New Material Co., Ltd. was de-registered. See Note VIII. Changes to the Consolidation
Scope and Note IX. Disclosure of Interest in Other Entities for details.
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IV Basis for the preparation of financial statements
1. Preparation basis
The financial report is prepared based on enterprise accounting standards issued by the Ministry of Finance and
application guide, interpretation and other related provision (collectively “Enterprise Accounting Standards”). The
Group has also disclosed related financial information according to the requirement of the Regulations of
Information Disclosure No.15 – General Provisions for Financial Statements (Revised in 2014) issued by the
CSRC.
2. Continuous operation
The Company is capable of continuous operation. The financial statement is prepared based on continuous
operation.
The Group's audit is based on the accrual basis. Except for some financial instruments and property held for
investment, the financial statements are prepared based on historical costs. In case of any asset impairment, the
impairment provision will be made as required.
V Significant Accounting Policies and Estimates
Specific accounting policy and assumption prompt:
1. Statement of compliance to the Accounting Standards for Business Enterprises
The financial report and statements are prepared with compliance to the requirement of the Enterprise Accounting
Standards. They reflect the financial position as of December 31, 2014, and business performance and cash flow
situation in Year 2014 of the Company frankly and completely.
2. Fiscal period
The fiscal year of the Group is the solar calendar year, that is from January 1 to December 31.
3. Operating period
The operating period of the Group is 12 months.
4. Bookkeeping standard money
The Group takes RMB as the standard currency for bookkeeping.
4. Accounting treatment of the entities under common and different control
(1) Consolidation of entities under common control
Assets and liabilities obtained by the merging party are calculated at their book value with the merged parties at
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the merger day in the final controller’s consolidated financial statements in addition to the adjustment made given
the difference in accounting policies. The differences between the book value of net assets and the book value of
consideration price (or the total of face value of share issued) are adjusted to the capital reserve (share capital
premium). If the share capital premium is not enough to offset the difference, it will be adjusted to the retained
gains.
(2) Consolidation of entities under different control
For merger of entities under different control, the merger cost is the fair value of the asset paid, liability
undertaken, and equity securities issued for exchanging of control power over the entities at the day of acquisition.
On the acquisition day, the assets and liabilities (if any) acquired by the Company from the acquired party are
recognized on the fair value.
If the merger costs exceed the fair value of the recognizable net assets of the acquired party in the merger, it is
recognized as goodwill and measured based the costs after the accumulative impairment provision is deducted; if
the fair value exceeds the costs, it is included in the income statement for the period after being re-examined.
Involved amount or consideration is included in consolidated cost at the fair value on the day of acquisition.
Where the value needs to be adjusted based on the amount on the date of acquisition 12 months later, the
consolidated goodwill should be adjusted accordingly.
(3) Treatment of transaction fees in merger
Agency expenses and other administrative expenses such as auditing, legal consulting, or appraisal services
occurred relating to the merger of entities are accounted into current income account when occurred. The
transaction fees of equity certificates or liability certificates issued by the purchaser for payment for the
acquisition are accounted at the initial amount of the certificates.
6. Preparation of Consolidated Financial Statements
(1) Consolidation scope
The consolidation scope of consolidated financial statements is determined based on control. Control refers to a
power possessed by the Group on invested entities, the power of enjoying variable return by participating in
activities conducted by invested entities, and capabilities of using the power to change the returns. Subsidiaries are
enterprises controlled by the Company.
(2) Preparation of Consolidated Financial Statements
Consolidated financial statements are prepared by the Company based on financial statements of the Company
and subsidiaries and according to other related information. During preparation of consolidated financial
statements, the accounting policies and period of the Company and subsidiaries must be the same. Major
transactions and balances between companies are offset.
Subsidiaries and businesses newly incorporated under the same control during the report period are considered
incorporated in the consolidation scope since the date on which they are controlled. Business results and cash
flows are consolidated in the consolidated income and cash flow statements since the same date.
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Incomes, expenses and profits of subsidiaries and businesses newly incorporated under different control and their
businesses are consolidated from the date of acquisition and end of the report period in the consolidated income
statement, with cash flows consolidated in the consolidated cash flow statement.
The part of the shareholders’ equity in subsidiaries not owned the Company are separately listed under the
shareholders’ equity as minority shareholders’ equity in the consolidated balance sheet. The part of the
subsidiaries’ net profits and losses for the current period that belongs to minority shareholders is listed as minority
shareholders’ profits and losses under net profit in the consolidated income statement. If the losses of
subsidiaries shared by the minority shareholders exceed the part of the owners’ equity of the subsidiaries at the
beginning of the period, the excessive part will offset the minority shareholders’ equity.
7. Recognition of cash and cash equivalents
Cash refers to cash on hand and deposits that can be used at any time for payment. Cash equivalent refers to the
investments with short term, strong liquidity and small risk of value fluctuation that are held by the Group and
easily converted into cash with known amount.
8. Foreign exchange business and foreign exchange statement translation
Trades of the Group made in foreign currencies are translated into RMB basing on the spot exchange rate on the
date when the trade is conducted.
At the balance sheet date, foreign currency items are translated on the spot exchange rate of the balance sheet date.
The exchange differences caused by the difference in exchange rates on the balance sheet date and initial
recognizing date or previous balance sheet date are included in the current profits and losses. Non-monetary items
accounted in foreign currency and on historical costs are exchanged with the spot exchange rate on the transaction
date. Non-monetary items accounted in foreign currency and on fair value are exchanged with the spot exchange
rate on the determination date of the fair value. The exchange difference between the accounting
standard-currency amount and the original accounting standard-currency amount are included in the current
profits and losses.
9. Financial instrument
Financial instrument refers to a company’s financial assets and contracts that form other units of financial
liabilities or equity instruments.
(1) Recognition and derecognition of financial instrument
The Group recognizes a financial asset or liability when it becomes one party in the financial instrument contract.
Financial asset is derecognized when:
(1) The contractual right to receive the cash flows of the financial assets is terminated;
(2) The financial asset is transferred and meets the following derecognition condition.
When partial or all of the current responsibilities attached to such financial liabilities, the partial or all of the
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financial liabilities are derecognized. When the Group (debtor) and creditor enter into an agreement to replace
the existing financial liabilities by undertaking new financial liabilities and the contract terms for the new
financial liabilities are essentially different from those for the existing one, the existing financial liabilities will be
derecognized and new financial liabilities will be recognized.
Financial asset transactions in regular ways are recognized and de-recognized on the transaction date.
(2) Classification and measurement of financial assets
Financial assets of the Group are categorized as: financial assets measured at fair value with variations accounted
into current income account and account receivables. Financial assets are measured at the fair value at the initial
recognition. For financial assets measured at fair value with variations accounted into current income
account, related transaction expenses are accounted into the current income. For other financial assets,
the related transaction expenses are accounted into the initial recognized amounts.
Financial assets measured at fair value with variations accounted into current income account
It includes transactional financial assets and financial assets measured by fair value and with variations accounted
into current gain/loss account at initial recognition. The financial assets are further measured by fair value with the
gain/loss created by variations in fair value and related dividends and interest accounted into the current gain/loss
account.
Receivables
Receivables refer to non-derivative financial assets without quotations but with fixed recoverable amount or can
be confirmed, including receivable accounts and other receivables (Note V. 10). Receivables adopt the effective
interest method and are further measured by amortized cost. Gain/loss generated at final recognition, impairment
or amortization is accounted into the current gain/loss account.
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(3) Classification and measurement of financial liabilities
The Group’s financial liabilities are mainly other financial liabilities
Other financial liabilities adopt the effective interest method and are further measured by amortized cost.
Gain/loss generated at final recognition or amortization is accounted into the current gain/loss account.
(4) Fair value of financial instrument
See Note V 29 for the method of determining fair value of financial assets and liabilities.
(5) Impairment of financial assets
Financial assets measured at fair value with variations accounted into current income account. The Group checks
the book value of financial assets on the balance sheet date. Impairment provision will be made in case of
objective evidence proving impairment to the financial assets. Objective evidence proving impairment to the
financial assets refers to events actually occur after the initial recognition of financial assets, with influence on the
estimated future cash flows of the financial assets and can be reliably measured by the Company.
Objective evidence providing impairment to financial assets includes:
① Severe financial difficulties for the issuer or debtor;
② The debtor violates a contract, for example delaying in paying interest or principal;
③ The Group makes concessions for the debtor with financial difficulties for economic or legal reasons;
④ The debtor is likely to go into liquidation or other financial reorganization;
⑤ The financial assets cannot be traded in an active market due to severe financial difficulties of the issuer;
⑥ It is un-recognizable whether the cash flow of an asset in a group of financial assets decreases, but the
estimated future cash flow has decreased since the first recognition of the group of financial assets based on
general evaluation of open data and the decrease can be measured, including:
- The repaying capability of the debtor of the group of financial assets continues worsening;
- The group of financial assets may not be settled due to economic status of the country or district whether
the debtor is located;
⑦ The equity instrument may not be recovered due to material adverse changes to technical, market, economic or
legal status of the debtor;
⑧ Other objective evidence proving impairment to financial assets
Financial assets measured at amortized cost
If there is objective evidence proving impairment to the financial assets, the book value of the financial assets will
be written down to the present value of the estimated future cash flow (excluding undiscovered future credit loss).
The write-down amount is accounted into the current gain/loss account. The present value of the estimated
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future cash flow is determined by the original effective discount rate with the value of the guarantee considered.
Conduct impairment test separately for major financial assets. If there is objective evidence suggesting
impairment, determine the impairment loss and account it into the current gain/loss account. Conduct
impairment test for other financial assets including financial assets combination with similar credit risk features.
Test financial assets without impairment separately (including major and minor financial assets) and conduct
impairment test in the financial assets combination with similar credit risk features. Conduct impairment test for
financial assets separately recognized as impaired excluding financial assets combination with similar credit risk
features.
After the Group recognizes impair loss to financial assets measured by amortized cost, if there is object evidence
suggesting that the value of the financial assets is restored objectively due to an event after the loss, the
recognized impairment loss can be reversed and accounted into the current gain/loss account. The book value
after the reversal must not exceed the amortized cost of the financial assets on the reversal date assuming that no
impairment provision was made.
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(6) Transfer of financial assets
The transfer of financial assets refers to transferring or delivering the financial assets to another party (receiver)
other than the issuing party of the financial assets.
Recognition of the financial asset is terminated as soon as all of the risks and rewards attached to the financial
asset have been transferred to the receiver. Whereas if all of the risks and rewards attached to the financial assets
are reserved, recognition of the financial asset shall not be terminated.
When the Group neither transfers nor reserve almost all risks and rewards attached to the financial assets, it will
be handled as: When the controlling power over the financial asset is given up, the financial assets will be
derecognized and the generated assets and liabilities will be recognized; when the controlling power is not given
up, financial asset and related liability shall be recognized according to the extend the Group is involving in the
financial asset.
(7) Offsetting of financial assets and liabilities
When the Group has the legal right to offset recognized financial assets and liabilities and can exercise the right,
and the Group plans to set them in net value or realize the financial assets or repay the financial liabilities, the
financial assets and liabilities are presented in the balance sheet by their amounts after offsetting. Financial
assets and liabilities other than the above-mentioned circumstance are presented in the balance sheet separately
and are not offset.
10. Receivables
(1) Receivables with major individual amount and bad debt provision provided individually
For the current year, the Company recognizes project receivables
over RMB8 million (inclusive) as “individual receivable with
large amount” while recognizes product receivables over RMB2
Judging basis or standard of major individual amount
million (included) as “individual receivable with large amount”
and other receivables over RMB1 million (included) as
“individual receivable with large amount”.
The Company performs impairment examination individually on
each large amount receivables, and recognizes impairment and
Provision method for account receivable with major individual provides bad debt provision when the impairment is recognized
amount and bad debt provision provided individually based on objective evidence. Those not impaired are accounted
along with the minor amount receivables and recognized in risk
groups.
(2) Recognition and providing of bad debt provisions on groups
Group Method of bad debt provision
Account age Aging method
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Receivable accounts consolidated Other method
Receivables adopting the aging method in the group
√ Applicable □ Inapplicable
Age Providing rate for receivable account Providing rate for other receivables
Within 1 year (inclusive) 3.00% 3.00%
1-2 years 10.00% 10.00%
2-3 years 30.00% 30.00%
Over 3 years 50.00% 50.00%
Receivables adopting the balance percentage method in the group
□ Applicable √ Inapplicable
Receivables adopting other methods in the group
□ Applicable √ Inapplicable
(3) Receivables with minor individual amount and bad debt provision provided individually
Reasons for separate bad debt provision Long account age or deterioration of customer creditability
According to the difference between the present value of future
Method of bad debt provision
cash flow and the book value
11. Inventories
(1) Classification of inventories
The Group’s inventories include purchased materials, raw materials, low-value consumables, OEM materials,
products in process, semi-finished goods, finished goods, inventory, development cost, and construction in
process.
(2) Pricing of inventory
Inventories are measured at cost when procured. Raw materials, products in process, commodity stocks and goods
shipped in transit are measured by the weighted average method.
Construction contracts are measured by the effective cost, including direct and indirect expenses generated before
the contracts are fulfilled. Costs generated and recognized accumulatively by construction in process and settled
payment are listed in the balance sheet as offset net amounts. The excessive part of the sum of the generated costs
and recognized gross profit (loss) over the settled payment is listed inventories; the excessive part of the settled
payment over the sum of the generated costs and recognized gross profit (loss) is listed as the prepayment
received.
Travel and bidding expenses generated by execution of contracts, if they can be separated and reliably measured
and it is likely to enter into contracts, are accounted as the contract cost when the contracts are entered into; or
into the current gain/loss account if the conditions are not met.
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The actual costs of development include land transfer payment, infrastructure and facility costs, installation
engineering costs, borrows before completion of the development and other costs during the development process.
(3) Recognition of inventory realizable value and providing of impairment provision
12. Assets held for sales
13. Long-term share equity investment
(1) Recognition of initial investment costs
The investment cost of long-term share equity investment formed by entities under common control is the share of the book value of
the owner's equity of the merged party on the date of the merger. The investment cost of long-term share equity investment formed by
entities under different control is the merger cost on the date of the merger.
For other long-term investment: for those obtained with cash, the initial investment cost is the purchase price.
2. Subsequent measurement and recognition of gain/loss
Long-term equity investments in which the Group can control invested entities are accounted using the cost
method; investment in affiliates is accounted using the equity method.
For the long-term equity investment measured on the cost basis, the profit distributed by the invested entity is
recognized as investment gains in the current gain/loss account.
When the equity method is used, the current investment gain is the share of the net gain realized in the current
year that can be shared or borne.
(3) Basis for recognition of major influence on invested entities
Major influence refers to the power to participate in decision-making of financial and operation policies of a
company, but cannot control or jointly control the making of the policies. When determining whether major
influence can be added on the invested entity, it should be considered whether the investor directly or indirectly
holds voting shares of the invested entity and the investor and the impacts that can be created by switching
potential votes held by the investor and other parties into shares of the invested entity, including exchangeable
warrants, share options, exchangeable corporate bonds issued by the invested entity.
If the Company directly or through subsidiaries holds more than 20% (inclusive) but less than 50%
of the shares with voting rights of the invested entity, unless there is clear evidence proving that the
Company cannot participate the decision-making of production and operation of the invested entity,
the Company has major influence on the invested entity; If the Group directly or through
subsidiaries holds less than 20% (exclusive) of the shares with voting rights of the invested entity,
unless there is clear evidence proving that the Group participates the decision-making of production
and operation of the invested entity, the Group does not have major influence on the invested entity.
(4) Impairment examination and providing of impairment provision
See Note V, 19 for the assets impairment provision method for investment in subsidiaries and joint
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ventures.
14. Investment real estates
Measuring method for investment real estate
Measured at fair value
Measuring basis
Investment real estates of the Company are buildings leased.
For investment real estate with an active real estate transaction market and the Company can obtain market price
and other information of same or similar real estate to reasonably estimate the investment real estates’ fair value,
the Company will use the fair value mode to measure the investment real estate subsequently. Variations in fair
value are accounted into the current gain/loss account.
The fair value of investment real estate is determined with reference to the current market prices of same or
similar real estates in active markets; when no such price is available, with reference to the recent transaction
prices and consideration of factors including transaction background, date and district to reasonably estimate the
fair value; or based on the estimated lease gains and present value of related cash flows.
For an investment real estate whose fair value is proven unable to be obtained continuously and reliably by
objective evidence, the real estate will be measured at cost basis until it is disposed and no residual value remains
as assumed.
The difference of the proceeds from sales, transfer, retirement or destruction of investment real estate with book
value and related taxes deducted is accounted into the current gain/loss account.
See Note V 19 for the assets impairment provision method for the investment real estate that is subsequently
measured using the cost model.
15. Fixed assets
(1) Recognition conditions
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing
services, lease or for operation & management, and have more than one accounting year of service life. The fixed
assets can only be recognized hen economic interests related to the fixed assets are very likely to flow into the
company and the costs of the fixed assets can be reliably measured. The Group measures fixed assets at the
actual costs when the fixed assets are obtained
(2) Depreciation method
Annual depreciation
Type Depreciation method Service year Residual rate
rate %
Houses & buildings Average age 35-45 10.00% 2-2.57
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Mechanical
Average age 10 10.00% 9
equipment
Transportation
Average age 5 10.00% 18
facilities
Electronics and other
Average age 5 10.00% 18
devices
16. Construction in process
The Group recognizes the cost of construction in process according to the actual construction expense, including
necessary engineering expenses, borrowing costs to be capitalized before the engineering reaches the preset
service condition and other related costs.
Construction in process will be transferred to fixed assets when it reaches the preset service condition.
See Note V, 19 for the provision method for construction in process.
17. Borrowing expenses
(1) Recognition principles for capitalization of borrowing expenses
Borrowing expenses occurred to the Group that can be accounted as purchasing or production of asset satisfying
the conditions of capitalizing, are capitalized and accounted as cost of related asset. Borrowing expenses start to
be capitalized when all of the followings are satisfied:
(1) Asset expense has already occurred. Asset expenses include cash payment, non-cash asset transferring, or
undertaking of debt with interest done for purchasing or producing of assets;
(2) The borrowing expense has already occurred;
(3) Purchasing or production activity, which is necessary for the asset to reach the useful status, has already
started.
(2) During borrowing expense capitalization
When the asset satisfying the capitalizing conditions has reached its usable or sellable status, capitalizing of
borrowing expenses shall be terminated. Borrowing expenses incurred after assets that meet capitalization
conditions reach the service or sales conditions are accounted into the current gain/loss account according to the
actual amounts.
If the construction or production of assets satisfying the capitalizing conditions is suspended abnormally for over
3 months, capitalizing of borrowing expenses shall be suspended. During the normal suspension period,
borrowing expenses will be capitalized continuously.
(3) Calculation of the capitalization rate and amount of borrowing expense
The interest expense incurred actually from special borrowing in the current period is capitalized after deducting
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the interest income obtained from the borrowing that has not been used or investment gain obtained from
temporary investment; the capitalization amount of general borrow should be determined according to the
weighted average of the excessive part of the accumulative asset expense over the special borrowing multiple the
percentage of the special borrowing in general borrowing. The capitalization ratio is calculated according to the
weighted average interest rate of general borrowing.
During the capitalization period, the exchange difference of foreign currency special borrowing is fully capitalized;
the exchange difference of foreign currency general borrowing is included in the current gain/loss.
18. Intangible assets
(1) Pricing method, service life and impairment test
The Group’s intangible assets include land using rights, trademarks, patents, proprietary technologies, and
software.
Intangible assets are initially measured at costs and the useful life will be determined when obtained. Where the
useful life is limited, the intangible assets will be amortized within the predicted useful life by using the
amortization method that can reflect predicted realization way of the economic benefit of the assets; whether the
realization way cannot be reliably confirmed, use the straight-line method. If the useful life is uncertain, the
intangible assets are not amortized.
Intangible assets with limited useful life are amortized as followings:
Type Useful life Basis of amortization Notes
Land using right Beneficial age Average age
Trademarks and patents 10 Average age
Proprietary technology 10 Average age
Software 5, 10 years Average age
Other intangible assets 10 years or beneficial Average age
age
At the end of each year, the Group will reexamine the useful life and amortization basis of intangible assets with
limited useful life. If they change, adjust the prediction and handle it according to accounting estimate changes.
On the balance sheet day, if the intangible assets become unlikely to bring future economic benefits for the
Company, transfer all the intangible assets’ book value into the current gain/loss account.
See Note II, 20 for the impairment provision method for intangible assets.
(2) Internal research development expense accounting policy
The Group divides internal R&D project expenses into research and development expenses.
The research expenses are accounted the current gain/loss account.
Development expenses can only be capitalized when the following conditions are satisfied: the technology is
feasible for use or sales; there is the intention to use or sell the intangible assets; it can be proven that the product
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generated by the intangible assets is demanded or the intangible assets in demanded; if the intangible is used
internally, it can be proven that it is useful; with necessary technical and financial resources and other resources to
complete the development of the intangible assets and the intangible assets can be used or sold; the development
expense can be reliably measured. If not, the development expense is accounted into the current gain/loss
account.
If a research project meets the above-mentioned conditions and passes the technical and economic feasibility
study, the project will enter the development stage.
Expenses in the development stage capitalized are listed as development expense on the balance sheet and
transferred to intangible assets when the project reaches the useful condition.
19. Long-term assets impairment
The Group uses the cost mode to continue measuring the assets impairment to investment real estate, fixed assets
construction in progress, intangible assets and goodwill (except for the inventories, investment real estate
measured by the fair value mode, deferred income tax assets and financial assets). The method is determined as
follows:
The Group judges whether there is a sign of impairment to assets on the balance sheet day. If such sign exists, the
Group estimates the recoverable amount and conducts the impairment test. Impairment test is conducted
annually for goodwill generated by mergers and intangible assets whose service life is uncertain and that have not
reached the useful condition no matter whether the impairment sign exists.
The recoverable amount is determined by the higher of the net of fair value minus disposal expense and the
present value of the predicted future cash flow. The Group estimates the recoverable amount on the individual
asset item basis; whether it is hard to estimate the recoverable amount on the individual asset item basis,
determine the recoverable amount based on the asset group that the assets belong to. The assets group is
determined by whether the main cash flow generated by the group is independent from those generated by other
assets or assets groups.
When the recoverable amount of the assets or assets group is lower than its book value, the Group writes down the
book value to the recoverable amount, the write-down amount is accounted into the current income account and
the assets impairment provision is made.
For goodwill impairment test, the book value of goodwill generated by mergers is amortized through reasonable
measures since the purchase day to related asset groups; those cannot be amortized to related assets groups are
amortized to related combination of asset groups. The related asset groups or combination of asset groups refer to
those that can benefit from the synergistic effect of mergers and must not exceed to the reporting range
determined by the Group.
When the impairment test is conducted, if there is sign of impairment to the asset group or combination of asset
groups related to goodwill, first perform impair test for asset group or combination of asset groups without
goodwill and calculate the recoverable amount and recognize the related impairment loss. Then conduct
impairment test on those with goodwill, compare the book value with recoverable amount. If the recoverable
amount is lower than the book value, recognize the impairment loss of the goodwill.
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Once recognized, the asset impairment loss cannot be written back in subsequent accounting period.
20. Long-term amortizable expenses
The Group’s long-term amortizable expenses are measured at the actual costs and amortized averagely based on
the beneficial term. For long-term amortizable expenses that are not beneficial in the subsequent account periods,
the residual value is fully accounted into the current gain/loss account.
21. Staff remuneration
(1) Accounting method of short-term remuneration
In the accounting period, the Group pays medical insurance, employment injury insurance and birth insurance
based on their salaries, bonus, and the required ratio. The insurance cost is recognized as liability and included in
the gain/loss or related asset cost of the current period. If the liability will not be paid in 12 months after the report
period ends and the financial impact is material, the liability is measured at the discounted amount.
(2) Accounting method of post-employment benefit
The Group's post employment welfare scheme is the defined contribution plan. After making fixed
payment to an independent fund, the Company will not make further payment to the
post-employment welfare scheme, including basic retirement pension and unemployment insurance.
In the fiscal period, the payable to the defined contribution plan is recognized as liability and
included in the gain/loss or related asset cost of the current period.
22. Anticipated liabilities
When responsibilities occurred in connection to contingent issues, and all of the following conditions are satisfied,
they are recognized as expectable liability in the balance sheet:
(1) This responsibility is a current responsibility undertaken by the Group;
(2) Execution of this responsibility may cause financial benefit outflow from the Group;
(3) Amount of the liability can be reliably measured.
The anticipated liabilities are measured at the best estimated expense necessary for fulfilling the liabilities. The
book value of expected liability is revised at balance sheet day, and adjustment will be made to reflect current best
estimation.
23. Revenue
(1) General principles
1. Sales of goods
When all of the following conditions are satisfied, the sales of goods are recognized as sales income according to
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the contract amount received or receivable from the buyer: (1) Main risks and rewards attached to the ownership
of the goods have been transferred to the buyer; (2) No succeeding power of administration or effective control is
reserved which are usually attached to ownership; (3) Amount received can be reliably measured; (4) Related
financial benefit may inflow to the Company; (5) Relative costs, occurred or will occur, can be reliably measured.
2. Providing of labor service
If they are not in the same year, then use the estimation on percentage basis when it is possible.
The completion percentage is the costs occurred on the total cost.
The reliable estimation of the result of providing of labor service must meet the following conditions: A. the
revenue can be reliably measured; B. the economic benefit is very likely to flow into the company; C. the
completion can be determined reliably; D. costs incurred or will be incurred can be reliably measured.
If the result cannot be reliably estimated, use the service cost amount of the compensation obtained or will be
obtained to recognize the revenue of the providing of labor service and recognize the incurred labor service cost as
the current expense. If no compensation can be obtained for incurred labor service cost, no revenue can be
recognized.
3. Demising of asset using rights
The revenue is recognized when the financial benefit in connection with the demising of asset using right was
received and the amount can be reliably measured.
4. Construction contracts
On the balance sheet day, the Group recognizes the contract income and costs using the completion percentage
method if the result of the construction contract can be reliably estimated. If not, such contracts are treated
differently. If the contract cost can be recovered, the revenue is recognized according to the actual contract costs
that can be recovered and the contract cost is recognized as the current expense; if not, the contract cost is
recognized as the current expense and no revenue is recognized.
If the estimated total costs exceed the total revenue, the Group recognizes the estimated loss as the current
expense.
The competition percentage is determined by the share of the costs incurred in the total cost.
The reliable estimation of the result of a construction contract must meet the following conditions: A. the revenue
can be reliably measured; B. the economic benefit is very likely to flow into the company; C. the completion cost
can be clearly distinguished and determined reliably; D. the completion and costs that will be incurred for
completion of the contract can be reliably recognized.
(2) Specific revenue recognition method
Metro screen door projects of the Company and Shenzhen Fangda Automatic System, and curtain wall project of
Fangda Jianke are individual construction contracts. They are accounted by the following means:
Construction contracts completed within a fiscal year are recognized for their income and cost upon completion.
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China Fangda Group Co., Ltd. 2014 Annual Report
Income and expenses of the construction contracts carried over-year are recognized on percentage basis at balance
sheet day when all of the following conditions are satisfied: contract income can be reliably measured, relative
financial benefit can inflow to the Company; progress of the project and costs to complete the contract can be
reliably recognized; cost occurred to complete the contract can be clearly distinguished and reliably measured,
which enables comparing of actual cost with predicted cost.
Contract costs are direct and indirect expenses occurred since the date when the contract is engaged till the
completion day. The competition percentage is determined by the share of the costs incurred in the total cost.
Construction contracts completed in current term are recognized for income according to the actual total income
of the contract less income recognized in previous terms; meanwhile, the total costs of the contract less costs
recognized in previous terms are recognized as current contract costs. If the total contract cost is predicted to be
greater than the predicted total income, the predicted loss shall be recognized as current cost instantly.
Parts of the curtain wall project under Fangda Jianke are outsourced, and administrative fees are collected at the
agreed rate. For these construction contracts, income will be recognized when ongoing payment for the project is
received and corresponding costs are transferred.
Revenue of products for domestic sales is recognized when the Group delivers the products and receives the sales
payment or obtains the payment voucher; revenue for products for overseas sales is recognized at departure of the
products.
24. Government subsidy
(1) Judgment basis and accounting method of governmental subsidies related to assets
Government subsidy is only recognized when the required conditions are met and the subsidy is received.
When a government subsidy is monetary capital, it is measured at the received or receivable amount. When
there is no clear evidence indicating compliance with related conditions for governmental support and it is
estimated that the Company can receive a government subsidy, it will be measured at the receivable amount.
Otherwise, it is measured at the amount actually received.
Government subsidies related to assets are obtained by the Group to purchase, build or formulate in other manners
long-term assets; or subsidies related to benefits.
For subsidies that can formulate long-term assets without clear government regulations, the part of the subsidies
corresponding to the asset value will be measured as assets-related government subsidies, while the rest of them
will be measured as benefit-related government subsidies. Where it is difficult to distinguish them from each other,
the whole subsidies will be measured as benefit-related government subsidies.
Government subsidies in connection with capital are recognized as differed income, and amortized straight to its
useful life, and accounted into current income account.
(2) Judgment basis and accounting method of governmental subsidies related to profit
Government subsidies in connection with gains, which are used to cover current expenses or losses, are
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China Fangda Group Co., Ltd. 2014 Annual Report
recognized as current gain/loss, if used to cover future expenses or losses, recognized as differed gains, and
recorded to current income account to the period when the expenses are recognized. Government subsidy
measured at the nominal amount is accounted into current income account.
If a recognized government subsidy needs to be returned, if there are relative differed gains, the balance of
differed gains will be setoff, the exceeded part shall be recorded into current income account; if there is no relative
differed gain, record to current income account directly.
25. Deferred income tax assets and deferred income tax liabilities
Income tax includes current and deferred income tax Except for the adjustment goodwill generated by mergers or
deferred income tax related to transactions or events directly accounted into the owners’ equity, income tax is
accounted as income tax expense into the current gain/loss account.
The Group uses the temporary difference between the book value of the assets and liabilities on the balance sheet
day and the tax base and the liabilities method to recognize the deferred income tax.
The taxable temporary difference recognizes the related deferred income tax liabilities, unless the taxable
temporary difference is created by the following transactions:
(1) Initial recognition of goodwill, or of assets or liabilities generated in transactions with the following features:
the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;
(2) For taxable temporary difference related to investment in subsidiaries and affiliates, the reversal timing for the
temporary difference can be controlled and the difference is unlikely to be reversed in the foreseeable future.
For deductable temporary difference, deductible loss and tax deduction that can be accounted in subsequent years,
the Group recognizes the incurred deferred income tax assets to the extent to the future income tax proceeds that
is very likely to be received for deducting deductable temporary difference, deductable loss and tax deduction,
unless the deductable temporary difference is generated in following transactions:
(1) the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;
(2) for the taxable temporary difference related to investment in subsidiaries and affiliates, the corresponding
deferred income tax assets are recognized when the following condition is met: the temporary difference is very
likely to be reversed in the foreseeable future and it is very likely to receive the taxable proceeds that can be used
to deduct the deductable temporary difference.
On the balance sheet day, the Group measures the deferred income tax assets and liabilities with the tax rate
applicable during the predicted period during which the assets are recovered or the liabilities are paid off and
reflects the income tax influence of the assets recovery and liabilities repayment way on the balance sheet day.
On the balance sheet day, the Group re-examines the book value of the deferred income tax assets. If it is
unlikely to have adequate taxable proceeds to reduce the benefits of the deferred income tax assets, less the
deferred income tax assets’ book value. When there is adequate taxable proceeds, the lessened amount will be
reversed.
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26. Leasing
(1) Accounting of operational leasing
Rentals from operational leasing are recognized as current gains on straight basis to the periods of leasing. Initial
direct expenses are recorded to current income account.
Rentals in operational leasing are recorded to relative capital cost or current income account on straight basis to
the periods of leasing. Initial direct expenses are recorded to current income account.
(2) Accounting of financing leasing
The Company as the leasor: In leasing, the book value of financial rental is the sum of lowest amount of the rent
and the initial expenses since the date when the lease is started. The difference between the sum of lowest rental,
initial direct expense and unsecured balance and the current value is recognized as the unrealized financial income.
Unrealized financial income is recognized as financial income at actual interest basis to the periods of the leasing
period.
The Company as the leasee: The Company measures the leased assets as the lower of the fair value and the
present value of minimum lease payment of the leased assets on the starting date of the lease and records the
minimum lease payment as long-term payable and the difference between the two as unrecognized financing
expense. The initial direct expense is accounted into asset value. Unrecognized financial cost is recognized as
financial cost at actual interest basis to the periods of the leasing period. The Company adopts the depreciation
policy same as the self-owned fixed assets to made provision for depreciation of leased assets.
27 Other significant accounting policies and assumptions
Significant accounting judgment and estimate
The Company continuously reviews significant accounting judgment and estimate adopted for the reasonable
forecast of future events based on its historical experience and other factors.
Significant accounting judgment and assumptions that may lead to major adjustment of the book value of assets
and liabilities in the next accounting year are listed as follows:
(1) Goodwill impairment
The Company judges whether there is impairment to goodwill at least annually. This required valuation of the use
value of the asset groups with goodwill. While estimating the use value, the Company needs to estimate the cash
flow from the asset group in the future and choose the proper discount rate to calculate the present value of the
future cash flow.
(2) Estimate of fair value
The Company uses fair value to measure investment real estate and needs to estimate the fair value of investment
real estate at least quarterly. This requires the management to reasonably estimate the fair value of the investment
real estate with the half of valuation experts.
(3) Deferred income tax assets
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China Fangda Group Co., Ltd. 2014 Annual Report
If there is adequate taxable profit to deduct the loss, the deferred income tax assets should be recognized by all the
unused tax loss. This requires the management to make a lot of judgment to forecast the time and amount of
future taxable profit and determine the amount of the deferred tax assets based on the taxation strategy.
(4) Construction contracts
The Group recognizes gains of construction contracts according to the completion percentage of separated
contracts. The management estimates the completion percentage of construction projects according to the actual
cost in the total budget and estimates the contract gain. The activity date and completion date are usually included
in different accounting periods. The Group will review and revise contract gain and cost estimates in the budget
along the progress (if the actual contract gain is smaller than the estimated or actual contract cost, contract
estimate loss provision will be made).
28. Major changes in accounting policies and estimates
(1) Changes in accounting policies
√ Applicable □ Inapplicable
Change and reason Approval procedure Notes
On January 7, 2014, the Ministry of
Finance released three standards
including the Enterprise Accounting The standards became effective on
Standard No.39-Fair Value July 1, 2014 other than Enterprise
Measurement and revised four Accounting Standard No.37, which
standards including the Enterprise will be effective for 2014 and later
Accounting Standard fiscal periods.
No.2-Long-term Share Equity
Investment.
In the changes to the accounting policies, no impact is caused by accounting policies other than the following
ones.
According to the review Enterprise Accounting Standard No.30 – Financial Statement Presentation, the Group
adjusts the definition and presentation of other general gain. The part of the original capital reserve that belongs to
other general gain is adjusted. Other general gain items that cannot be reclassified into gain/loss and those that can
be classified into gain/loss when the conditions are met are distinguished from each other. The Group classifies
the opening and end balance of other general gain in capital reserve RMB91,831.63 into other general gain.
According to the revised Enterprise Accounting Standard No.30 – Financial Statement Presentation, the Group
adjusts the presentation of deferred gain. The deferred gain in other non-current liabilities is adjusted into deferred
gain. By December 31, 2014, the end balance of other non-current liabilities of RMB10,049,892.04 is classified
into deferred gain. The opening balance of 10,255,823.93 is adjusted accordingly.
(2) Changes in accounting estimates
□ Applicable √ Inapplicable
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China Fangda Group Co., Ltd. 2014 Annual Report
29. Others
Measured at fair value
Fair value is the price that the market participant needs to pay for acquiring an asset or transfer liability in an
orderly transaction on the measurement date.
For assets or liability of the Group measured at fair value, the orderly transaction in which assets are sold or
liability is transferred is conducted in the primary market of the related assets or liability; if there is no such
primary market, the Group assumes that the transaction is conducted in the most favorable market for the related
assets or liability. Primary market (or the most favorable market) is the transaction market that the Group can
enter on the measurement date. The Group uses the assumption under which the market participant can maximize
the economic benefit when the assets or liability is priced.
For financial assets or liability with an active market, the Group uses the price in the active market to recognize
the fair value. If there is no active market, the Company uses evaluation techniques to determine the fair value.
Where non-financial assets are measured by fair value, the capability of the assets is the maximum economic
benefit of the assets can be realized in the best use of it or other market participant who can make the best use of
it.
The Group adopts appropriate and sufficient data and other information-supporting evaluation techniques. Related
observable inputs are used firstly. Non-observable inputs are only used when observable inputs cannot be obtained
or are infeasible.
The fair value level of assets and liability measured or disclosed at fair value in financial statement are determined
according to the lowest input significant for the fair value as a howl: first-level input is the non-adjusted price of
the same assets or liability that can be obtained in an active market; second-level input is observable inputs with
direct or indirect impact on related assets or liability other than the first-level inputs; third-level inputs are
non-observable inputs of related assets and liability.
On each balance sheet day, the Group re-evaluates the assets and liability measured at the fair value and
recognized in the financial statements to confirm if any change happens to the fair value measurement level.
VI. Taxation
1. Major taxes and tax rates
Tax Tax basis Tax rate
VAT Taxable income 6、13、17
Business tax Taxable income 3、5
City maintenance and construction tax Taxable turnover 1、5、7
Enterprise income tax Taxable income See the following table
Education surtax Taxable turnover 3
Tax payers vary in the corporate income tax rate are listed as follows
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China Fangda Group Co., Ltd. 2014 Annual Report
Tax payer Tax rate
The Company 25%
Shenzhen Fangda Jianke Group Co., Ltd. (hereinafter Fangda
15%
Jianke)
Shenzhen Fangda Automatic System Co., Ltd. (hereinafter
15%
Fangda Automatic)
Shenzhen Fangda Yide New Material Co., Ltd. (hereinafter
25%
Fangda Yide)
Shenzhen Woke Semi-conductor Lighting Co., Ltd. (hereinafter
25%
Shenzhen Woke)
Fangda New Material (Jiangxi) Co., Ltd. (hereinafter Fangda
15%
New Material)
Jiangxi Fangda New Type Aluminum Co., Ltd. (hereinafter
25%
Fangda Aluminum)
Shenyang Fangda Semi-conductor Lighting Co., Ltd. (hereinafter
25%
Shenyang Fangda)
Dongguan Fangda New Material Co., Ltd. (hereinafter
25%
Dongguan New Material)
Shenzhen Kexunda Software Co., Ltd. (hereinafter Kexunda) 25%
Chengdu Fangda Construction Technology Co., Ltd. (hereinafter
15%
Chengdu Fangda)
Fangda Decoration Engineering (Shenyang) Co., Ltd.
25%
(hereinafter Shenyang Decoration)
Shenzhen Fangda Property Development Co., Ltd. (hereinafter
25%
Fangda Property Development)
Shenzhen Fangda New Energy Co., Ltd. (hereinafter Fangda
25%
New Energy)
Guangdong Fangda SOZN Lighting Co., Ltd. (hereinafter
25%
Fangda SOZN)
2. Tax preference
(1) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological
Innovation, Shenzhen Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau
on September 12, 2012, Fangda Jianke was entitled to enjoy a tax preference of enterprise income tax of 15% for
three years (2012-2014) since the qualifications were awarded.
(2) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological
Innovation, Shenzhen Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau
on September 12, 2012, Fangda Automatic was entitled to enjoy a tax preference of enterprise income tax of 15%
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China Fangda Group Co., Ltd. 2014 Annual Report
for three years (2012-2014) since the qualifications were awarded.
(3) According to the Certification of High-tech Enterprise issued by Jiangxi Ministry of Science and Technology,
Jiangxi Ministry of Finance, Jiangxi National Tax Bureau, and Jiangxi Local Tax Bureau on November 7, 2012,
Fangda New Material was entitled to enjoy a tax preference of enterprise income tax of 15% for three years
(2012-2014) since the qualifications were awarded.
(4) On December 25, 2013, Kexunda was certified by Shenzhen Nanshan National Tax Bureau as a software and
integrated circuit designer according to the Shenzhen National Tax Reduction Registration [2013] No.739 and
will enjoy exemption from the enterprise income tax for two years and 50% reduction of the same tax for another
three years from the year that the company starts making a net profit. Kexunda started making profits in 2013 and
therefore starts to enjoy the exemption.
(5) On November 7, 2014, Chengdu Fangda was certified by the Sichuan Xinjin National Tax Bureau as an
encouraged business in the west according to the Xinjin National Tax Doc. [zzy024] and will enjoy a preferential
corporate income tax rate of 15% from January 1, 2014.
V. Notes to the consolidated financial statements
1. Monetary capital
In RMB
Items Closing balance Ending balance
Cash on hand 40,733.33 33,975.32
Bank deposits 114,515,874.25 297,145,634.33
Other monetary capital 97,874,191.29 36,697,312.32
Total 212,430,798.87 333,876,921.97
Including: Overseas deposit 2,370,695.75 65,446.08
Notes
1. RMB12 million among the balance of bank deposit at end of year was frozen by the court for the lawsuit
involved by Fangda Jianke. For details of the case please see Note XIII, 1.
2. Balance of RMB97,874,191.29 under other monetary capital was mainly deposit for bank accepted notes and
letter of guarantee, including deposit of RMB97,792,566.68 for accepted notes and guarantee letter which are
not regarded as cash equivalent at preparing of cash flow statement.
3. The 36.37% decrease of the closing balance from the opening balance is mainly attributed to increase in
investment in the renovation of Fangda Town in the period and purchase of short-term financial products late
this report period.
2. Financial assets measured at fair value with variations accounted into current income account
In RMB
Items Closing balance Ending balance
109
China Fangda Group Co., Ltd. 2014 Annual Report
Transactional financial assets 13,410,790.00
Investment in equity tools 13,410,790.00
Total 13,410,790.00
Notes
The Group holds 100 million shares in Sino Oil and Gas Holdings Limited.
3. Derivative financial assets
□ Applicable √ Inapplicable
4. Notes receivable
(1) Classification of notes receivable
In RMB
Items Closing balance Ending balance
Bank acceptance bill 2,697,145.86 21,898,770.43
Commercial acceptance bill 80,628,579.84
Total 83,325,725.70 21,898,770.43
(2) Receivable notes endorsed or discounted but not mature at the end of the period
In RMB
Items De-recognized amount Not de-recognized amount
Bank acceptance bill 75,895,357.71
Commercial acceptance bill 14,125,500.00
Total 90,020,857.71
5. Account receivable
(1) Account receivable are disclosed by categories
In RMB
Closing balance Ending balance
Bad debt provision Bad debt provision
Remaining book Remaining book
balance at the end balance at the end of
Type value Book value
of the period the period Book value
value
Proportio Provision Proportio Provision
Amount Amount Amount Amount
n rate n rate
Recognition and 1,280,50 98.68% 175,879, 13.74% 1,104,625 1,059,9 98.00% 161,204,9 15.21% 898,730,98
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China Fangda Group Co., Ltd. 2014 Annual Report
providing of bad debt 4,982.91 731.45 ,251.46 35,942. 60.82 1.93
provisions on groups 75
Account receivable
with minor individual
17,154,2 16,537,2 617,000.0 21,620, 21,570,47
amount and bad debt 1.32% 96.40% 2.00% 99.77% 50,000.00
85.41 85.41 0 471.60 1.60
provision provided
individually
1,081,5
1,297,65 192,417, 1,105,242 182,775,4 898,780,98
Total 100.00% 14.83% 56,414. 100.00% 16.90%
9,268.32 016.86 ,251.46 32.42 1.93
35
Account receivable with major individual amount and bad debt provision provided individually at the end of the
period:
□ Applicable √ Inapplicable
In the group, the account receivable of which bad debt provision is made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Closing balance
Age Bad debt provision balance at
Account receivable Provision rate
the end of the period
Items less than 1 year
Less than 1 year 712,092,320.08 21,362,769.59 3.00%
Subtotal for less than 1 year 712,092,320.08 21,362,769.59 3.00%
1-2 years 262,647,258.23 26,264,725.84 10.00%
2-3 years 123,152,331.43 36,945,699.43 30.00%
Over 3 years 182,613,073.17 91,306,536.59 50.00%
Total 1,280,504,982.91 175,879,731.45 13.74%
Note:
Account receivable adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
Account receivable adopting other methods in the group:
None
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB21,710,901.08 were made in this period; none was recovered or reversed in this
period.
Important bad debt write-back or recovery:
In RMB
Entity Written-back or recovered amount Method
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China Fangda Group Co., Ltd. 2014 Annual Report
(3) Written-off account receivable during the period
In RMB
Items Amount
Actually written-off account receivable 12,440,143.04
Important write-off of account receivable
In RMB
Entity Nature Amount Reason Write-off procedure Related transaction
Notes to written-off account receivable:
Fangda Yide completed liquidation in this period, Accounts receivable of RMB12,058,685.51 were written off.
(4) Top 5 account receivable entities at the end of the period
The total balance of accounts receivable due from top 5 account receivable entities at the end of the period is
RMB146,062,403.09, accounting for 11.26% of the aggregate. Bad debt provisions made totaled
RMB27,719,198.96 at the end of the period.
6. Prepayment
(1) Account age of prepayments
In RMB
Closing balance Ending balance
Age
Amount Proportion Amount Proportion
Less than 1 year 24,526,989.72 83.90% 24,086,301.50 84.92%
1-2 years 2,991,743.88 10.23% 2,582,202.92 9.10%
2-3 years 163,672.10 0.56% 486,463.33 1.72%
Over 3 years 1,551,825.79 5.31% 1,209,048.46 4.26%
Total 29,234,231.49 -- 28,364,016.21 --
(2) Top 5 prepayment entities at the end of the period
The total balance prepayment made by top 5 prepayment entities at the end of the period is RMB7,819,029.20,
accounting for 25.71% of the aggregate at the end of the period.
7. Receivable interest
(1) Receivable interest classification
In RMB
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China Fangda Group Co., Ltd. 2014 Annual Report
Items Closing balance Ending balance
Time deposit 36,387.50
Total 36,387.50
8. Other receivables
(1) Other receivables are disclosed by categories
In RMB
Closing balance Ending balance
Bad debt provision Bad debt provision
Remaining book Remaining book
balance at the end balance at the end of
Type value Book value
of the period the period Book value
value
Proportio Provision Proportio Provision
Amount Amount Amount Amount
n rate n rate
Other receivables
with major individual
1,220,3 1,220,316
amount and bad debt 1.47% 100.00%
16.84 .84
provision provided
individually
Recognition and
62,085,1 13,134,5 48,950,64 79,642, 13,343,55 66,298,730.
providing of bad debt 99.64% 21.16% 96.15% 16.75%
55.66 07.99 7.67 281.33 1.16 17
provisions on groups
Account receivable
with minor individual
223,146. 223,146. 1,971,8 1,971,822
amount and bad debt 0.36% 100.00% 2.38% 100.00%
95 95 22.77 .77
provision provided
individually
62,308,3 13,357,6 48,950,64 82,834, 16,535,69 66,298,730.
Total 100.00% 21.44% 100.00% 19.96%
02.61 54.94 7.67 420.94 0.77 17
Other receivables with major individual amount and bad debt provision provided individually at the end of the
period:
□ Applicable √ Inapplicable
In the group, the other receivables of which bad debt provision are made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Closing balance
Age Other receivables at the end of Bad debt provision balance at
Provision rate
the period the end of the period
Items less than 1 year
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China Fangda Group Co., Ltd. 2014 Annual Report
Subtotal for less than 1 year 23,951,028.17 718,521.63 3.00%
1-2 years 12,221,834.10 1,222,183.42 10.00%
2-3 years 8,811,718.34 2,643,515.50 30.00%
Over 3 years 17,100,575.05 8,550,287.44 50.00%
Total 62,085,155.66 13,134,507.99 21.16%
Note:
Other receivables adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
Other receivables adopting other methods in the group:
□ Applicable √ Inapplicable
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB1,575,546.4 were made in this period; none was recovered or reversed in this period.
(3) Other receivable actually written off in the current period.
In RMB
Items Amount
Actually written-off other receivable 4,771,216.93
Notes to written-off other receivables:
Fangda Yide completed liquidation in this period, Other receivables of RMB3,391,658.26 were written off.
(4) Other receivables disclosed by nature
In RMB
By account Closing balance of book value Opening balance of book value
Deposit 37,088,745.12 55,316,690.93
Engineering project borrowing and
14,869,519.46 10,722,385.63
advance
House disposal receivable 2,136,200.00
Staff borrowing and petty cash 1,410,387.87 2,260,157.64
VAT refund receivable 576,297.37 278,416.96
Others 6,227,152.79 14,256,769.78
Total 62,308,302.61 82,834,420.94
(5) Top 5 other receivable entities at the end of the period
In RMB
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China Fangda Group Co., Ltd. 2014 Annual Report
Bad debt provision
Percentage in the
Entity By account Closing balance Age balance at the end of
aggregate
the period
Hainan Green Town
Deposit 4,346,000.00 1-2 years 6.97% 434,600.00
Investment Co., Ltd.
Advanced
Wang Weihong 695.00 Less than 1 year 0.00% 20.85
engineering cost
Advanced
Wang Weihong 352,178.17 1-2 years 0.57% 35,217.82
engineering cost
Advanced
Wang Weihong 564,963.00 2-3 years 0.91% 169,488.90
engineering cost
Advanced
Wang Weihong 3,337,246.98 Over 3 years 5.36% 1,668,623.49
engineering cost
Zhejiang Jiayue
Deposit 500,000.00 1-2 years 0.80% 50,000.00
Industrial Co., Ltd.
Zhejiang Jiayue
Deposit 3,199,100.00 2-3 years 5.13% 959,730.00
Industrial Co., Ltd.
Advanced
Xin Song 2,653,327.61 Over 3 years 4.26% 1,326,663.81
engineering cost
Chen Jian Zhong Ji
(Zhejiang) Business
Deposit 1,907,624.65 1-2 years 3.06% 190,762.47
Development Co.,
Ltd.
Total -- 16,861,135.41 -- 27.06% 4,835,107.34
9. Inventories
(1) Classification of inventories
In RMB
Closing balance Ending balance
Items Remaining book Depreciation Remaining book Depreciation
Book value Book value
value provision value provision
Raw materials 101,814,705.80 2,551,138.82 99,263,566.98 47,592,162.78 1,492,798.29 46,099,364.49
Product in
6,682,625.91 2,277.73 6,680,348.18 5,992,333.49 5,992,333.49
process
Finished goods in
22,999,746.67 2,470,651.68 20,529,094.99 10,246,627.50 1,984,145.11 8,262,482.39
stock
Completed but 251,262,257.58 1,830,742.67 249,431,514.91 229,499,318.33 1,830,742.67 227,668,575.66
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China Fangda Group Co., Ltd. 2014 Annual Report
not settled assets
formulated by
construction
contracts
Low price
59,672.66 59,672.66 51,278.67 51,278.67
consumable
OEM materials 3,358,174.63 3,358,174.63 873,790.05 873,790.05
Development cost 603,118,814.70 603,118,814.70 139,590,027.07 139,590,027.07
Total 989,295,997.95 6,854,810.90 982,441,187.05 433,845,537.89 5,307,686.07 428,537,851.82
(2) Inventory depreciation provision
In RMB
Increase in this period Decrease in this period
Items Ending balance Reversed or Closing balance
Provision Others Others
written off
Raw materials 1,492,798.29 1,098,377.42 40,036.89 2,551,138.82
Product in
2,277.73 2,277.73
process
Finished goods in
1,984,145.11 486,506.57 2,470,651.68
stock
Completed but
not settled assets
formulated by 1,830,742.67 1,830,742.67
construction
contracts
Total 5,307,686.07 1,587,161.72 40,036.89 6,854,810.90
(3) Note
Development cost in the balance at the end of the inventory period includes the capitalization amount of the
borrowing cost of RMB15,466,418.47.
(4) Development cost
Project Start time Estimate Estimated total Closing amount Opening Depreciatio
complete time investment amount n provision
Investment at the end of
the period
Fangda Town May. 2014 Dec. 2016 2,421,911,100 603,118,814.70 139,590,027.07
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China Fangda Group Co., Ltd. 2014 Annual Report
(5) Completed but not settled assets formulated by construction contracts
In RMB
Items Amount
Accumulative occurred costs 4,827,856,677.82
Accumulative recognized gross margin 767,911,779.61
Less: estimated loss 1,830,742.67
Settled amount 5,344,506,199.85
Completed but not settled assets formulated by construction
249,431,514.91
contracts
10. Other current assets
In RMB
Items Closing balance Ending balance
Deductible tax input 6,986,107.72
Bank financial products 228,000,000.00
Total 234,986,107.72
Notes
Bank financial product in other current assets refers to CCB Qian Yuan – Fu Shun Ying open asset portfolio RMB
financial products purchased by the Group and BOC Monthly Plan GSRJYL01 financial product. The financial
products are not principal-guaranteed with floating returns.
11. Long-term share equity investment
In RMB
Invested entity Opening amount Increase Decrease Closing amount
Affiliate
Shenzhen Ganshang
Joint Investment Co., 9,994,565.55 1,054,094.88 11,048,660.43
Ltd.
12. Investment real estates
(1) Investment real estate measured at costs
√ Applicable □ Inapplicable
Items Houses & buildings Land using right Construction in process Total
I. Book value
1. Opening balance 26,150,933.45 26,150,933.45
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China Fangda Group Co., Ltd. 2014 Annual Report
2. Increased amount in this
20,674,244.77 20,674,244.77
period
(1) Transferred from fixed
20,674,244.77 20,674,244.77
assets
3. Decreased amount in this
14,743,910.08 14,743,910.08
period
(2) Transfer-out for self-use 14,743,910.08 14,743,910.08
4. Closing balance 32,081,268.14 32,081,268.14
II. Accumulative total
depreciation and
amortization
1. Opening balance 5,680,620.94 5,680,620.94
2. Increased amount in this
1,922,459.18 1,922,459.18
period
(1) Provision or amortization 768,601.33 768,601.33
(2) Transferred from fixed
1,153,857.85 1,153,857.85
assets
3. Decreased amount in this
3,287,749.22 3,287,749.22
period
(2) Transfer-out for self-use 3,287,749.22 3,287,749.22
4. Closing balance 4,315,330.9 4,315,330.90
III. Book value
1. Closing book value 27,765,937.24 27,765,937.24
2. Opening book value 20,470,312.51 20,470,312.51
(2) Investment real estate measured at fair value
√ Applicable □ Inapplicable
In RMB
Items Houses & buildings Land using right Construction in process Total
I. Opening balance 174,778,756.62 174,778,756.62
II. Change in the period 23,734,829.53 23,734,829.53
Transfer-in
from inventory/fixed
assets/construction in
progress
Other 11,162,802.57 11,162,802.57
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China Fangda Group Co., Ltd. 2014 Annual Report
transfer-out
Change in fair
34,897,632.10 34,897,632.10
value
III. Closing balance 198,513,586.15 198,513,586.15
(3) Investment real estate without ownership certificate
By December 31, 2014, no property ownership certificate has been applied for any of the investment real
estate.
13. Fixed assets
(1) Fixed assets
In RMB
Houses & Mechanical Electronic Transport
Items Others Total
buildings equipment equipment equipment
1. Opening balance 393,946,389.09 233,769,225.30 40,817,091.98 17,163,113.28 685,695,819.65
2. Increased amount in
49,617,440.25 11,489,620.93 16,914,554.37 6,723,382.99 84,744,998.54
this period
(1) Purchase 22,617,056.78 9,615,264.77 12,332,649.64 6,293,372.50 50,858,343.69
(2) Transfer-in of
1,093,670.82 1,926,646.77 3,020,317.59
construction in progress
(3) Merger 1,874,356.16 2,655,257.96 430,010.49 4,959,624.61
(4) Transfer-in of investment
25,906,712.65 25,906,712.65
real estates
3. Decreased amount in
28,887,622.15 738,729.07 1,944,205.02 534,222.55 32,104,778.79
this period
(1) Disposed or
8,213,377.38 738,729.07 1,944,205.02 534,222.55 11,430,534.02
retired
(2) Other decrease 20,674,244.77 20,674,244.77
4. Closing balance 414,676,207.19 244,520,117.16 55,787,441.33 23,352,273.72 738,336,039.40
1. Opening balance 26,604,093.45 150,791,998.23 21,055,152.64 9,179,557.42 207,630,801.74
2. Increased amount in
13,723,613.32 9,312,492.67 3,928,791.53 1,768,471.31 28,733,368.83
this period
(1) Provision 10,435,864.10 9,279,732.35 3,884,506.10 1,762,483.11 25,362,585.66
(2) Merger 32,760.32 44,285.43 5,988.20 83,033.95
(3) Transfer-in of investment
3,287,749.22 3,287,749.22
real estates
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China Fangda Group Co., Ltd. 2014 Annual Report
3. Decreased amount in
1,854,629.52 183,304.92 1,736,870.15 900,277.55 4,675,082.14
this period
(1) Disposed or
700,771.67 183,304.92 1,736,870.15 900,277.55 3,521,224.29
retired
(2) Other decrease 1,153,857.85 1,153,857.85
4. Closing balance 38,473,077.25 159,921,185.98 23,247,074.02 10,047,751.18 231,689,088.43
1. Opening balance 1,131,563.50 14,003,184.43 15,134,747.93
2. Increased amount in
2,651,337.41 2,651,337.41
this period
(1) Provision 2,651,337.41 2,651,337.41
3. Decreased amount in
853,819.00 853,819.00
this period
(1) Disposed or
853,819.00 853,819.00
retired
4. Closing balance 277,744.50 16,654,521.84 16,932,266.34
1. Closing book value 375,925,385.44 67,944,409.34 32,540,367.31 13,304,522.54 489,714,684.63
2. Opening book value 366,210,732.14 68,974,042.64 19,761,939.34 7,983,555.86 462,930,269.98
(2) Temporary idle fixed assets
In RMB
Accumulative Impairment
Items Book value Book value Notes
depreciation provision
Houses & buildings 46,833,628.81 5,086,265.30 277,744.50 41,469,619.01
Mechanical
105,591,939.34 67,175,395.78 15,300,132.34 23,116,411.22
equipment
Transportation
358,087.84 335,658.73 22,429.11
facilities
Electronics and other
7,822,284.94 7,317,787.20 504,497.74
devices
Total 160,605,940.93 79,915,107.01 15,577,876.84 65,112,957.08
(3) Fixed assets without ownership certificate
In RMB
Items Book value Reason
Houses in Urumuqi for offsetting debt 580,196.93 Applying for
Yuehai Office Building C 502 161,032.14 Historical reasons
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Houses in Dalian of Fangda Jianke for
20,228,382.98 Applying for
offsetting debt
Shenyang Fangda extension workshop 17,582,204.34 Entering into liquidation
Shenyang Fangda dorm and workshop 2# 8,145,332.66 Entering into liquidation
Dining hall and power station of Shenyang
3,913,314.22 Entering into liquidation
Fangda
14. Construction in process
(1) Construction in progress
In RMB
Closing balance Ending balance
Items Remaining book Impairment Remaining book Impairment
Book value Book value
value provision value provision
Xinjin energy
saving and green
341,749.17 341,749.17 26,715.00 26,715.00
curtain wall
project
Decoration of
Fangda Building 914,126.00 914,126.00
5F and 20F
Total 341,749.17 341,749.17 940,841.00 940,841.00
(2) No impairment provision is made for construction in progress.
15. Disposal of fixed assets
In RMB
Items Closing balance Ending balance
Mechanical equipment 26,918.21 144,421.47
Tools and apparatus 3,761.50
Transport equipment 2,829.75
Other equipment 26,285.39
Total 26,918.21 177,298.11
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16. Intangible assets
(1) Intangible assets
In RMB
Non-patent
Items Land using right Patent Others Total
technology
1. Opening balance 93,144,805.39 1,266,728.37 24,330,413.42 9,024,654.00 127,766,601.18
2. Increased amount in this
4,870,594.02 4,339,236.09 2,003,730.99 11,213,561.10
period
(1) Purchase 4,870,594.02 69,861.70 2,003,730.99 6,944,186.71
(3) Merger 4,269,374.39 4,269,374.39
3. Decreased amount in this
40,160.00 40,160.00
period
(2) Other decrease 40,160.00 40,160.00
4. Closing balance 98,015,399.41 5,565,804.46 24,330,413.42 11,028,384.99 138,940,002.28
1. Opening balance 9,476,058.26 832,698.67 15,463,344.49 4,940,985.47 30,713,086.89
2. Increased amount in this
1,889,109.92 491,682.20 571,988.88 824,825.75 3,777,606.75
period
(1) Provision 1,889,109.92 384,947.84 571,988.88 824,825.75 3,670,872.39
(2) Merger 106,734.36 106,734.36
3. Decreased amount in this
23,886.22 23,886.22
period
(2) Other decrease 23,886.22 23,886.22
4. Closing balance 11,365,168.18 1,300,494.65 16,035,333.37 5,765,811.22 34,466,807.42
1. Opening balance 5,525,863.77 5,525,863.77
4. Closing balance 5,525,863.77 5,525,863.77
1. Closing book value 86,650,231.23 4,265,309.81 2,769,216.28 5,262,573.77 98,947,331.09
2. Opening book value 83,668,747.13 434,029.70 3,341,205.16 4,083,668.53 91,527,650.52
Intangible asset formed by internal R&D of the period accounts for 2.8% of the balance of intangible assets.
(2) Failure to obtain the land use right
In RMB
Items Book value Reason
Chengdu Fangda land use right 4,855,744.50 Applying for
Notes
Shenyang Fangda, a subsidiary of the Company, entered the liquidation procedure in the period. The amortizable
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China Fangda Group Co., Ltd. 2014 Annual Report
value RMB5,525,863.77 of non-patent technology without realizable value is fully provided for intangible assets
impairment.
17. Goodwill
(1) Original goodwill book value
In RMB
Invested entity or Increase Decrease
Ending balance Closing balance
item of goodwill Merger Others Disposal Others
Shenzhen Woke 8,197,817.29 8,197,817.29
Fangda Yide 746,519.62 746,519.62
Fangda SOZN 26,279,395.89 26,279,395.89
Total 8,944,336.91 26,279,395.89 746,519.62 34,477,213.18
(2) Goodwill impairment provision
In RMB
Invested entity or Increase Decrease
Ending balance Closing balance
item of goodwill Provision Others Disposal Others
Shenzhen Woke 8,197,817.29 8,197,817.29
Fangda Yide 746,519.62 746,519.62
Fangda SOZN
Total 8,944,336.91 746,519.62 8,197,817.29
Goodwill impairment test process, parameter and impairment loss recognition method:
1. The Company acquired the 100% control power over Shenzhen Woke Co. by merger of enterprise under
common control in May 2007. The difference between the initial investment cost and recognizable fair value
of the investee has formed the goodwill of RMB8,197,817.29. For Shenzhen Woke was not in good business
operation for successive years, impairment provision has been provided fully upon the goodwill.
2. The Company acquired the minority share equities of Fangda Yide Co. in August 2007. The difference
between the initial investment cost and recognizable fair value of the investee has formed the goodwill of
RMB746,519.62. For Fangda Yide was not in good business operation for successive years, impairment
provision has been provided fully upon the goodwill. Given that Fangda Yide was liquidated in 2014,
goodwill and goodwill impairment provision of RMB746,519.62 was transferred out.
18. Long-term amortizable expenses
In RMB
Items Ending balance Increase in this Amortized in this Other decrease Closing balance
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period period
Epoxy floor 1,120,531.13 162,004.50 958,526.63
Plant and dormitory
1,482,723.37 443,246.64 1,039,476.73
decoration
Upgrading of
workshop rented by
284,336.02 41,108.82 243,227.20
Fangda Jianke
Nanchang Branch
Upgrading of
workshop rented by 207,303.07 138,636.40 68,666.67
Fangda Jianke
Lifting fee for the
Anhui SASAC 12,000.00 12,000.00
project
Renovation of office
and plants rented by 120,243.95 15,621.55 126,752.90 9,112.60
Chengdu Fangda
Jinshan factory
renovation of
521,902.82 109,874.16 412,028.66
Fangda Jianke
Shanghai Branch
Renovation of fixed
385,810.80 51,387.63 334,423.17
assets leased
Dongguan isolation
389,086.57 77,817.36 311,269.21
project
Upgrading of
workshop rented by 664,974.60 102,930.29 562,044.31
Fangda SOZN
Anti junk email
49,519.66 16,506.60 33,013.06
module service fee
General wiring
project of the office
91,257.00 22,814.28 68,442.72
on 5th floor of
Fangda Building
Others 50,314.43 60,690.98 31,873.74 79,131.67
Total 3,799,354.79 1,656,961.16 1,336,953.32 4,119,362.63
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19. Deferred income tax assets and deferred income tax liabilities
(1) Not deducted deferred income tax assets
In RMB
Closing balance Ending balance
Items Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Assets impairment
215,379,455.02 33,823,708.10 216,510,309.81 35,815,369.06
provision
Unrealized profit of
11,839,968.61 2,579,827.55 6,715,484.36 1,636,018.35
internal transactions
Deductible loss 56,605,182.29 13,897,641.41 9,460,002.94 2,365,000.74
Reserved expense 3,055,220.98 458,283.15 2,361,521.89 354,228.28
Reserved wage 3,087,427.61 463,114.14 3,063,966.18 459,594.93
Deferred earning 2,161,818.23 515,225.13 2,261,103.48 535,832.20
Anticipated liabilities 5,859,045.98 878,856.90
Total 297,988,118.72 52,616,656.38 240,372,388.66 41,166,043.56
(2) Not deducted deferred income tax liabilities
In RMB
Closing balance Ending balance
Items Taxable temporary Deferred income tax Taxable temporary Deferred income tax
difference liabilities difference liabilities
Gain/loss caused by
198,937,747.60 49,734,436.90 162,627,055.88 40,656,763.97
changes in fair value
Total 198,937,747.60 49,734,436.90 162,627,055.88 40,656,763.97
(3) Details of unrecognized deferred income tax assets
In RMB
Items Closing balance Ending balance
Deductible temporary difference 40,015,820.28 58,902,435.47
Deductible loss 70,274,405.85 69,150,558.57
Total 110,290,226.13 128,052,994.04
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China Fangda Group Co., Ltd. 2014 Annual Report
(4) Deductible losses of the un-recognized deferred income tax asset will expire in the following years
In RMB
Year Closing amount Opening amount Notes
2014 7,864,870.78
2015 7,240,577.12 7,695,652.54
2016 19,999,060.04 22,158,289.57
2017 20,241,373.78 20,241,373.78
2018 11,130,985.83 11,190,371.90
2019 11,662,409.08
Total 70,274,405.85 69,150,558.57 --
20. Other non-current assets
In RMB
Items Closing balance Ending balance
Prepaid house and equipment amount 41,684,590.97 15,978,789.90
Deductible tax input 1,639,287.66
Total 43,323,878.63 15,978,789.90
(1) The increase in the other non-current assets is the house purchase payment made by Fangda Jianke to Dalian
Gaoxin Wanda Plaza Investment Co., Ltd., Tianjin Wanda Center Investment Co., Ltd. and Zixi Greentown
Investment Co., Ltd.
(2) The deductible tax input increased in the period because Shenyang Fangda and Shenzhen Woke stopped
operation and cannot obtain sufficient sales tax deduction in the short term.
21. Short-term borrowings
(1) Classification of short-term borrowings
In RMB
Items Closing balance Ending balance
Loan by pledge 200,000,000.00 104,000,000.00
Guarantee loan 900,000,000.00 265,000,000.00
Total 1,100,000,000.00 369,000,000.00
Notes to classification of short-term borrowings
By December 31, 2014, the Group's pledged borrowings are using buildings as pledge.
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22. Notes payable
In RMB
Type Closing balance Ending balance
Commercial acceptance 12,106,210.45 9,356,905.04
Bank acceptance 215,160,275.12 179,213,945.59
Total 227,266,485.57 188,570,850.63
23. Account payable
(1) Account payable
In RMB
Items Closing balance Ending balance
Account repayable and engineering
558,886,064.80 366,465,573.67
payables
Construction payable 21,675,087.66 10,418,557.07
Payable installation and
102,780,295.76 107,489,398.01
implementation fees
Others 1,766,898.51 4,842,611.57
Total 685,108,346.73 489,216,140.32
24. Prepayment received
(A) Prepayment
In RMB
Items Closing balance Ending balance
Curtain wall and screen door
115,346,105.96 163,602,896.86
engineering payment
Material loan 6,106,352.73 1,970,928.42
Others 832,772.45 2,812,426.66
Total 122,285,231.14 168,386,251.94
(2) Major prepayment aged over 1 year
In RMB
Items Closing balance Reason
Fuzhou Metro Co., Ltd. 3,234,553.34 Engineering prepayment
127
China Fangda Group Co., Ltd. 2014 Annual Report
Xi'an Metro Co., Ltd. 3,143,967.62 Engineering prepayment
Total 6,378,520.96 --
25. Employees wage payable
(1) Employees wage payable
In RMB
Items Ending balance Increase Decrease Closing balance
1. Short-term
30,102,357.84 225,699,515.08 214,150,801.41 41,651,071.51
remuneration
2. Post employment
welfare scheme - defined 80,493.96 11,359,604.66 11,387,855.87 52,242.75
contribution plan
Total 30,182,851.80 237,059,119.74 225,538,657.28 41,703,314.26
(2) Short-term remuneration
In RMB
Items Ending balance Increase Decrease Closing balance
1. Wage, bonus,
allowance and 27,807,395.20 206,363,308.89 194,651,151.04 39,519,553.05
subsidies
2. Employee welfare 32,064.56 9,295,212.85 9,327,277.41
3. Social insurance 56,233.99 5,242,822.78 5,259,444.02 39,612.75
Including: medical
51,062.33 4,285,469.08 4,302,961.41 33,570.00
insurance
Labor injury
3,429.18 684,771.38 684,843.56 3,357.00
insurance
Breeding insurance 1,742.48 272,582.32 271,639.05 2,685.75
4. Housing fund 99,607.50 4,176,672.82 4,233,695.12 42,585.20
5. Labor union
budget and staff 2,107,056.59 621,497.74 679,233.82 2,049,320.51
education fund
Total 30,102,357.84 225,699,515.08 214,150,801.41 41,651,071.51
(3) Defined contribution plan
In RMB
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China Fangda Group Co., Ltd. 2014 Annual Report
Items Ending balance Increase Decrease Closing balance
1. Basic pension 73,842.08 10,611,654.97 10,635,742.05 49,755.00
2. Unemployment
6,651.88 747,949.69 752,113.82 2,487.75
insurance
Total 80,493.96 11,359,604.66 11,387,855.87 52,242.75
26. Taxes payable
In RMB
Items Closing balance Ending balance
VAT 6,739,115.69 -1,250,348.83
Business tax 25,489,264.49 23,221,596.65
Enterprise income tax 16,071,901.30 15,884,641.78
Personal income tax 1,228,564.47 902,435.66
City maintenance and construction tax 2,329,212.21 1,895,518.80
Land using tax 2,534,674.36 1,515,989.53
Property tax 2,287,765.04 1,477,538.33
Education surtax 1,123,167.45 907,151.22
Local education surtax 298,064.57 148,031.74
Others 595,196.67 137,392.89
Total 58,696,926.25 44,839,947.77
27. Interest payable
In RMB
Items Closing balance Ending balance
Short-term borrowing interests payable 2,055,911.11 689,153.75
Total 2,055,911.11 689,153.75
Notes
The interest payable at the end of the period increased 198.32% from the beginning because the Group’s bank
borrowing increased.
28. Other payables
(1) Other payables by nature
In RMB
Items Closing balance Ending balance
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China Fangda Group Co., Ltd. 2014 Annual Report
Performance and quality deposit 22,806,218.88 20,142,316.44
Deposit 6,264,664.14 6,931,340.61
Reserved expense 9,369,196.08 6,587,792.11
Others 8,985,603.34 8,026,131.56
Total 47,425,682.44 41,687,580.72
(2) Other major payables aged over 1 year
In RMB
Items Closing balance Reason
Guangzhou Nanjiang Civil Engineering Performance deposit, the engineering
8,289,683.50
Co., Ltd. payment is unsettled
Guangzhou Nanjian Civil Engineering Co., Performance deposit, the engineering
3,000,000.00
Ltd. payment is unsettled
Ningbo Lailai Energy-Saving Door &
2,060,000.00 Deposit
Windows Development Co., Ltd.
Total 13,349,683.50 --
29. Non-current liabilities due within 1 year
In RMB
Items Closing balance Ending balance
Long-term payables due within 1 year 6,000,000.00
Total 6,000,000.00
Notes
Long-term payable due within 1 year is the share transfer payable within one year according to investment
agreement and share transfer agreement for acquisition of 60% shares in Fangda SOZN by Fangda New Energy.
30. Long-term payables
(1) Long-term payables by nature
In RMB
Items Closing balance Ending balance
Share transfer payable 12,000,000.00
Subtotal 12,000,000.00
Less: Long-term payables due within 1
6,000,000.00
year
Total 6,000,000.00
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China Fangda Group Co., Ltd. 2014 Annual Report
Notes
The share transfer payable is the transfer payment due within more than 1 year according to investment agreement
and share transfer agreement for acquisition of 60% shares in Fangda SOZN by Fangda New Energy.
31. Anticipated liabilities
In RMB
Items Closing balance Ending balance Reason
Pending lawsuit 5,039,045.98 See Note XIII, 1
Others 820,000.00
Total 5,859,045.98 --
32. Deferred earning
In RMB
Items Ending balance Increase Decrease Closing balance Reason
Government subsidy 10,255,823.93 205,931.89 10,049,892.04 Assets-related
Total 10,255,823.93 205,931.89 10,049,892.04 --
In RMB
Amount included
Amount of new Related to
Liabilities Ending balance in non-operating Other change Closing balance
subsidy assets/earning
revenue
Major investment
project prize from
Industry and
Trade
1,966,666.70 57,142.80 1,909,523.90 Assets-related
Development
Division of
Dongguan
Finance Bureau
Massive
production
project of
air-breathing
7,994,720.45 106,646.64 7,888,073.81 Assets-related
double-layer
hollow glass
energy-saving
curtain call
Railway transport 294,436.78 42,142.45 252,294.33 Assets-related
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China Fangda Group Co., Ltd. 2014 Annual Report
screen door
controlling
system and
information
transmission
technology
Total 10,255,823.93 205,931.89 10,049,892.04 --
Notes
(1) The Dongguan Finance Bureau Industry and Trade Development Division major subsidy project is a
subsidized project not stipulated in Dongguan Financial Circular [2013] No.779. As the project has formed into
long-term assets, the Company treats it as an assets-related government subsidy.
(2) The massive production project of air-breathing double-layer hollow glass energy-saving curtain wall is a
subsidized project stipulated in Guangdong Financial Doc [2013] No.183. As the project has formed into
long-term assets, the Company treats it as an assets-related government subsidy.
(3) The railway transport screen door controlling system and information transmission technology is a subsidized
project stipulated in Shenzhen Tech Innovation [2013] No.242. RMB300,000 is used to purchase equipment and
RMB900,000 is used to purchase materials and for travel fees. As the project has formed into long-term assets, the
Company treats RMB300,000 as assets-related government subsidy and RMB900,000 as earning-related
government subsidy.
33. Capital share
In RMB
Change (+,-)
Closing
Ending balance Issued new Transferred
Bonus shares Others Subtotal balance
shares from reserves
Total of capital
756,909,905.00 756,909,905.00
shares
34. Capital reserve
In RMB
Items Ending balance Increase Decrease Closing balance
Capital premium (share
38,238,222.48 38,238,222.48
capital premium)
Other capital reserves 40,860,997.90 40,860,997.90
Total 79,099,220.38 79,099,220.38
132
China Fangda Group Co., Ltd. 2014 Annual Report
35. Other miscellaneous income
In RMB
Amount occurred in the current period
Less: amount
written into
After-tax After-tax
Ending Before tax other gains Less: Closing
Items attributable attributable
balance in current and transferred Income tax balance
to parent to minority
period into gain/loss expenses
company shareholder
in previous
terms
(2) Other comprehensive gain that
91,831.63 91,831.63
will be classified into gain/loss
Investment real estate measured at
91,831.63 91,831.63
fair value
Total of other miscellaneous income 91,831.63 91,831.63
36. Surplus reserves
In RMB
Items Ending balance Increase Decrease Closing balance
Statutory surplus
46,389,142.21 2,452,938.55 48,842,080.76
reserves
Total 46,389,142.21 2,452,938.55 48,842,080.76
Note:
The increase in the surplus reserve is attributable to the 10% provision on the after-tax net profit of the parent
according to Articles of Association of the Company.
37. Retained profit
In RMB
Items Current period Last period
Adjustment on retained profit of previous period 278,149,631.63 230,907,879.99
Retained profit adjusted at beginning of year 278,149,631.63 230,907,879.99
Plus: Net profit attributable to owners of the
96,998,429.76 85,676,863.78
parent
Less: Statutory surplus reserves 2,452,938.55 15,894,599.27
Common share dividend payable 22,707,297.15 22,540,512.87
Closing retained profit 349,987,825.69 278,149,631.63
133
China Fangda Group Co., Ltd. 2014 Annual Report
Details of retained profit adjusted at beginning of the period
1) Retrospective adjustment due to adopting of the Enterprise Accounting Standard and related regulations,
included the retained profit by RMB0.
2) Variation of accounting policies, influenced the retained profit by RMB0.
3) Correction of material accounting errors, influenced the retained profit by RMB0.
4) Change of consolidation range caused by merger of entities under common control, influenced the retained
profit by RMB0.
5) Other adjustment influenced the retained profit by RMB0.
38. Operational revenue and costs
In RMB
Amount occurred in the current period Occurred in previous period
Items
Income Cost Income Cost
Main business 1,896,533,575.46 1,573,131,645.17 1,697,728,577.19 1,412,825,229.71
Other business 41,790,860.05 17,705,140.85 49,892,268.55 12,543,974.71
Total 1,938,324,435.51 1,590,836,786.02 1,747,620,845.74 1,425,369,204.42
39. Business tax and surcharge
In RMB
Items Amount occurred in the current period Occurred in previous period
Business tax 14,227,005.22 13,788,191.30
City maintenance and construction tax 4,077,936.61 4,071,880.14
Education surtax 2,163,665.87 1,921,563.67
Property tax 1,019,630.24 1,232,548.46
Land using tax 107,681.50 150,753.68
Others 1,259,720.55 2,107,376.59
Total 22,855,639.99 23,272,313.84
Notes
See VI. Tax for the calculation standard of business tax and surcharges.
40. Sales expense
In RMB
Items Amount occurred in the current period Occurred in previous period
Labor costs 23,748,948.40 20,594,907.02
Freight and miscellaneous charges 6,207,886.36 6,061,750.15
134
China Fangda Group Co., Ltd. 2014 Annual Report
Travel expense 5,067,027.92 3,211,228.05
Entertainment expense 2,204,861.40 1,956,831.61
Material consumption 1,449,539.85 911,912.24
Office costs 1,246,910.58 1,856,349.96
Rental 1,295,860.13 975,957.59
Advertisement and business promotion
2,041,379.42 523,282.43
cost
Others 1,421,892.64 1,290,822.55
Total 44,684,306.70 37,383,041.60
41. Management expenses
In RMB
Items Amount occurred in the current period Occurred in previous period
Labor costs 75,477,871.56 61,712,341.07
Depreciation and amortization 18,501,963.63 20,496,282.99
Agencies 3,603,925.17 1,934,253.99
Tax 6,689,450.36 5,462,000.30
Maintenance costs 4,055,124.83 2,775,338.16
Water and electricity 1,594,371.07 1,552,664.57
Office expense 3,010,166.04 3,588,714.66
Travel expense 2,577,863.90 2,357,134.52
R&D 16,901,351.15 9,671,242.90
Entertainment expense 2,024,918.27 1,653,162.04
Rental 2,334,921.30 3,591,131.18
Lawsuit 1,950,459.20 2,411,335.91
Material consumption 1,754,537.01 470,234.11
Property management fee 2,386,763.59 2,357,853.90
Others 9,721,026.52 7,220,556.96
Total 152,584,713.60 127,254,247.26
42. Financial expenses
In RMB
Items Amount occurred in the current period Occurred in previous period
Interest expense 46,439,424.36 24,548,276.25
135
China Fangda Group Co., Ltd. 2014 Annual Report
Less: Interest capitalization 15,466,418.47
Less: Interest income 3,193,733.32 3,054,605.10
Acceptant discount 248,232.09
Exchange gain/loss -383,218.13 861,872.66
Less: exchange gain/loss capitalization
Commission charges and others 1,520,772.27 753,042.58
Total 29,165,058.80 23,108,586.39
43. Assets impairment loss
In RMB
Items Amount occurred in the current period Occurred in previous period
1. Bad debt loss 23,199,527.20 33,742,863.78
2. Inventory depreciation loss 1,587,161.72 40,254.89
7. Fixed assets impairment loss 2,651,337.41
Total 27,438,026.33 33,783,118.67
44. Income from fair value fluctuation
In RMB
Source of income from fluctuation of fair
Amount occurred in the current period Occurred in previous period
value
Financial assets measured at fair value
with variations accounted into current -2,852,885.00
income account
Investment real estate measured at fair
34,897,632.10 16,647,859.74
value
Total 32,044,747.10 16,647,859.74
45. Investment income
In RMB
Items Amount occurred in the current period Occurred in previous period
Gains from long-term equity investment
1,054,094.88 -5,434.45
measured by equity
Investment income from disposal of long-term
-1,478,245.70
equity share investment
Other investment gains 2,144,844.80 306,301.37
136
China Fangda Group Co., Ltd. 2014 Annual Report
Total 1,720,693.98 300,866.92
46. Non-business income
In RMB
Amount occurred in the current Amount accounted into the
Items Occurred in previous period
period current accidental gain/loss
Total of gains from disposal of
3,162,999.40 154,552.62 3,162,999.40
non-current assets
Including: Gains from disposal
3,162,999.40 154,552.62 3,162,999.40
of fixed assets
Government subsidy 2,340,175.75 1,815,855.07 2,340,175.75
Penalty income 217,749.21 228,295.79 217,749.21
Compensation received 41,826.64 190,428.00 41,826.64
VAT rebated into revenue 1,886,134.97 818,825.27
Payable account not able to be
1,447,458.99 250,648.50 1,447,458.99
paid
Others 7,185,114.22 4,137,250.99 7,185,114.22
Total 16,281,459.18 7,595,856.24 14,395,324.21
Government subsidies accounted into current profit or loss:
In RMB
Item Occurred in current period Occurred in previous period Related to assets/earning
Railway transport screen door
controlling system and
42,142.45 935,563.22 Assets-related
information transmission
technology
Major investment project prize
from Industry and Trade
57,142.80 33,333.30 Assets-related
Development Division of
Dongguan Finance Bureau
Massive production project of
air-breathing double-layer
106,646.64 25,279.55 Assets-related
hollow glass energy-saving
curtain call
Shenzhen hi-tech project
1,011,800.00 Earning-related
subsidy
Chinese famous brand,
Guangdong famous brand and 200,000.00 Earning-related
Guangdong famous product
137
China Fangda Group Co., Ltd. 2014 Annual Report
subsidies
Nanchang Industry Information
Committee and Financial
200,000.00 Earning-related
Department subsidies for
formulating industry standards
Nanchang hi-tech industry part
management committee subsidy
100,000.00 Earning-related
for technological development
projects
Chengdu new material
100,000.00 Earning-related
company award
Nanchang high-tech zone
management committee subsidy
150,000.00 Earning-related
for formulating industry
standards
Nanchang hi-tech industry
development zone management
141,100.00 Earning-related
committee subsidy for hi-tech
industries
Jiangxi Financial Ministry
136,700.00 Earning-related
export exhibition subsidy
Private enterprise and SME
development fund IT 570,000.00 Earning-related
construction project subsidy
2012 High-quality foreign trade
export subsidy granted by 188,179.00 Earning-related
Shenzhen Finance Commission
Nanchang Quality and
Technology Supervision Bureau 50,000.00 Earning-related
well-known brand product prize
Others 94,643.86 13,500.00 Earning-related
Total 2,340,175.75 1,815,855.07 --
Notes
Major projects are disclosed as follows:
1. Fangda Jianke recovered the revenue of RMB4,893,062.86 related to the Dalian Yunshan engineering
project.
2. Waste income RMB1,446,492.20
138
China Fangda Group Co., Ltd. 2014 Annual Report
47. Non-business expenses
In RMB
Amount occurred in the current Amount accounted into the
Items Occurred in previous period
period current accidental gain/loss
Total of losses from disposal of
1,709,152.13 617,106.70 1,709,152.13
non-current assets
Including: Losses from disposal
1,709,152.13 446,022.67 1,709,152.13
of fixed assets
Donation 958,000.00 367,000.00 958,000.00
Penalty and overdue fine 364,256.62 173,744.23 364,256.62
Estimated lawsuit compensation 5,039,045.98 5,039,045.98
Others 2,553,257.37 186,524.37 2,553,257.37
Total 10,623,712.10 1,344,375.30 10,623,712.10
Notes
(1) See Note XIII, 1 for estimated lawsuit compensation.
(2) Major amounts are disclosed as follows:
Shenyang Fangda made a provision of RMB411,590.52 according to the judgment of the semi-conductor industry
park phase I chip packaging plant construction contract; Shenyang Fangda made a provision of RMB354,119.76
according to the judgment of the semi-conductor industry park phase I dormitory and plant #2 construction
contract; Shenyang Fangda made a provision of RMB100,306.06 for the semi-conductor purchase and sales
contract with Dongguan Enrui Precision Equipment Co., Ltd. Shenyang Fangda made a provision of
RMB1,034,158.33 for the payable engineering amount according to the judgment of the P16 full-color LED
display engineering contract with Shenyang Xingmoer.
48. Income tax expenses
(1) Income tax expenses
In RMB
Items Amount occurred in the current period Occurred in previous period
Income tax expenses 18,618,875.30 19,777,942.50
Deferred income tax expenses -1,125,127.73 -528,180.90
Total 17,493,747.57 19,249,761.60
(2) Accounting profit and income tax expense adjustment
In RMB
139
China Fangda Group Co., Ltd. 2014 Annual Report
Items Amount occurred in the current period
Total profit 110,183,092.23
Income tax expense calculated by lawful/applicable tax rate 27,545,773.06
Impacts of different tax rates on subsidiaries -13,527,919.55
Impacts of income tax in periods before adjustment -1,537,060.30
Impacts of non-taxable income -290,185.38
Impacts of non-deductible costs, expenses and losses 1,541,210.73
Impacts of using deductible loss with recognizing deferred
-764,290.33
income tax assets
Deductible temporary difference and deductable loss of
4,321,849.71
unrecognized deferred income tax assets
Others 204,369.63
Income tax expenses 17,493,747.57
49. Other miscellaneous income
See Note VII, 35.
50. Cash flow statement items
(1) Other cash inflow related to operation
In RMB
Items Amount occurred in the current period Occurred in previous period
Interest income 3,230,120.82 3,091,050.93
Subsidy income 2,134,243.86 12,041,679.00
Retrieving of deposits for exchange bills 174,858.62
Retrieving of bidding deposits 9,893,934.66 4,508,546.79
Other operating accounts 16,028,346.33 21,236,605.34
Total 31,286,645.67 41,052,740.68
(2) Other cash paid related to operation
In RMB
Items Amount occurred in the current period Occurred in previous period
Sales expense 17,958,181.41 16,096,357.83
Administrative expense 38,615,205.18 39,553,659.77
Bidding deposit paid 868,076.30 9,952,466.34
140
China Fangda Group Co., Ltd. 2014 Annual Report
Net draft deposit net paid 61,152,900.09 10,697,929.46
Other trades 14,978,873.55 14,449,566.74
Total 133,573,236.53 90,749,980.14
(3) Other cash received related to investment activities
In RMB
Items Amount occurred in the current period Occurred in previous period
Bidding and contract deposit related to
65,500.00 429,055.00
construction projects
Total 65,500.00 429,055.00
(4) Other cash paid related to investment activities
In RMB
Items Amount occurred in the current period Occurred in previous period
Bidding deposit paid related to
331,500.00 1,659,058.00
construction projects
Total 331,500.00 1,659,058.00
(5) Other cash received related to financing: None
(6) Other cash paid related to financing: None
51. Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
In RMB
Supplementary information Amount of the Current Term Amount of the Previous Term
1. Net profit adjusted to cash flow of
-- --
business operation
Net profit 92,689,344.66 81,400,779.56
Plus: Asset impairment provision 27,438,026.33 33,783,118.67
Fixed asset depreciation, gas and petrol
26,131,186.99 23,877,998.21
depreciation, production goods depreciation
Amortization of intangible assets 3,670,872.39 3,920,173.92
Amortization of long-term amortizable
1,336,953.32 1,362,450.83
expenses
141
China Fangda Group Co., Ltd. 2014 Annual Report
Loss from disposal of fixed assets, intangible
assets, and other long-term assets (“-“ for -1,453,847.27 410,730.16
gains)
Loss from fixed asset discard (“-“ for gains) 51,823.92
Loss from fair value fluctuation (“-“ for
-32,044,747.10 -16,647,859.74
gains)
Financial expenses (“-“ for gains) 30,961,335.85 25,012,994.14
Investment losses (“-“ for gains) -1,720,693.98 -300,866.92
Decrease of deferred income tax asset
-10,202,800.67 -4,974,658.47
(“-“ for increase)
Increase of deferred income tax asset (“-“ for
9,077,672.93 4,446,477.57
increase)
Decrease of inventory (“-“ for increase) -523,064,898.18 -22,336,480.28
Decrease of operational receivable items
-292,111,913.10 -198,931,167.94
(“-“ for increase)
Increase of operational receivable items
172,552,478.48 235,992,177.52
(“-“ for decrease)
Others -61,152,900.09 -10,523,070.84
Cash flow generated by business operations,
-557,893,929.44 156,544,620.31
net
2. Major investment and financing operation
-- --
not involving with cash
3. Net change of cash and cash equivalents -- --
Balance of cash at period end 102,638,232.19 285,237,255.38
Less: Initial balance of cash 285,237,255.38 240,167,372.86
Net increase in cash and cash equivalents -182,599,023.19 45,069,882.52
(2) Net cash obtained from subsidiaries in the period
In RMB
Amount
Related company and consolidated in paid cash or cash equivalent
36,000,000.00
in the period
Including: --
Fangda SOZN 36,000,000.00
Less: Cash and cash equivalent held by the subsidiary on the
20,297,575.13
acquisition date
142
China Fangda Group Co., Ltd. 2014 Annual Report
Including: --
Fangda SOZN 20,297,575.13
Including: --
Net cash obtained from the subsidiary 15,702,424.87
(3) Net cash received from subsidiaries in the period: None
(4) Composition of cash and cash equivalents
In RMB
Items Closing balance Ending balance
I. Cash 102,638,232.19 285,237,255.38
Including: Cash in stock 40,733.33 33,975.32
Bank savings can be used at any time 102,515,874.25 285,145,634.33
Other monetary capital can be used at any
81,624.61 57,645.73
time
3. Balance of cash and cash equivalents at
102,638,232.19 285,237,255.38
end of term
52. Ownership or use right restricted assets
In RMB
Items Closing book value Reason
Monetary capital 109,792,566.68 Frozen deposit and cash deposit
Fixed assets 54,390,783.41 Loan by pledge
Investment real estate 198,513,586.15 Loan by pledge
Total 362,696,936.24 --
Notes
(1) The above-mentioned monetary capital cannot be used at anytime and is not included in cash and cash
equivalent in the cash flow statement.
(2) The restricted investment real estate is the Fangda Technology Building pledged to CCB Shenzhen OCT
sub-branch.
53. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
143
China Fangda Group Co., Ltd. 2014 Annual Report
Exchanged RMB balance at the
Items Foreign currency balance Exchange rate
end of the period
Monetary capital -- --
Including: USB 386,114.22 6.1190 2,362,632.92
HK Dollar 9,876.04 0.78887 7,790.92
SGD 208,054.76 4.6396 965,290.86
Account receivable -- --
Including: USB 6,150,218.83 6.1190 37,633,189.02
EUR 2,039,722.10 0.78887 1,609,075.57
SGD 17,312.18 4.6396 80,321.59
Financial assets measured at fair
value with variations accounted
into current income account
Including: HK dollar 17,000,000.00 0.78887 13,410,790.00
Other receivables at the end of
the period
Including: USB 156,327.54 6.1190 956,568.22
(2) No overseas operating entity
54. Hedging
Qualitative and quantitative information about hedging projects, tools and risks: None
VIII. Changes to consolidation scope
1. Consolidation of entities under common control
(1) Merger of companies not under the common control during the report period
In RMB
Acquisition Income of Net profit of
Acquired Acquisition Acquisition Acquisition date acquired acquired
Cost Percentage
party date method date determination party during party during
basis the period the period
Monetary Control
Fangda August 4, capital September 1, power 95,761,317.8
48,000,000.00 60.00% 4,320,158.67
SOZN 2014 acquisition 2014 acquisition 4
and injection date
Notes
144
China Fangda Group Co., Ltd. 2014 Annual Report
(2) Consolidation cost and goodwill
Items Fangda SOZN
Consolidation cost:
Cash 6,000,000.00
Or fair value with consideration 42,000,000.00
Total consolidation cost 48,000,000.00
Less: recognizable net asset fair value can be obtained 21,720,604.11
Goodwill 26,279,395.89
Notes:
Fangda New Energy and Shenzhen Jinma Yinke entered into a share transfer agreement. Fangda New Energy
acquires 60% of Fangda SOZN’s shares at RMB6 million to RMB48 million. The final amount depends on
Fangda SOZN’s performance over the next three years (July-December 2014, 2015 and 2016). The stock transfer
amount is up to RMB18 million. The Company shall pay the amount to Luo Huichi in three installments: The first
installment of RMB 6million shall be paid after both parties sign the stock transfer agreement, complete the
transfer and registration procedures, and the Company holds 60% of the Target Company’s stocks. The second
installment of RMB 6million shall be paid after the Target Company realizes 90% or higher of the sales or net
profit target for 2014 (between July and December); the first installment of RMB6 million will be paid after the
Target Company realizes 90% or higher of the sales or net profit target for 2015. If the conditions for the second
and third installments are not met, the Company does not need to pay the stock transfer amounts to the
Counterpart and the 60% shareholding of the Target Company by the Company remains unchanged.
The Company will provide interest-free loans of RMB30 million to the Target Company with a mature date of
December 31, 2016 after the share transfer agreement is signed, both parties complete the commercial and
industrial registration, the Company holds 60% of the Target Company’s shares. If the Target Company
completes 90% of the sales target or accumulative net profit target between July 2014 and December 2016, the
loans will be transferred to the acquisition payment of 60% of the Target Company and the Target Company does
not need to repay the loans. Otherwise, Luo Huichi shall transfer 30% of the Target Company’s shares held by her
to the Company at the price of RMB1/share.
The Group forecasts that Fangda SOZN will fulfill the performance target over the next three years. Therefore, the
acquisition cost may reach RMB42 million.
Reason for large-amount goodwill:
See (2) Consolidation cost and goodwill
Notes
None
(3) Recognizable assets and liabilities of acquired party on acquisition date
Fair value and book value of Fangda SOZN’s recognizable assets and liabilities on the acquisition date:
145
China Fangda Group Co., Ltd. 2014 Annual Report
Items Fangda SOZN
Fair value on the acquisition Book value on the acquisition
date date
Current asset 53,943,847.00 53,943,847.00
Non-current assets 14,516,977.74 14,516,977.74
Including: other intangible assets 4,162,640.03 4,162,640.03
Including: fixed assets 4,876,590.66 4,876,590.66
Current liabilities 32,259,817.89 62,259,817.89
Non-current liabilities
Net assets 36,201,006.85 6,201,006.85
Less: minor shareholders’ equity 14,480,402.74 2,480,402.74
Net assets obtained from consolidation 21,720,604.11 3,720,604.11
Determination method of the fair value of recognizable assets and liabilities
None
Notes
None
2. Changes to the consolidation scope with other reasons
Other reasons that cause changes to the consolidation scope and related information
Fangda New Energy and Shihui International Holding were established and consolidated in the period.
Fangda Yi was liquidated in the period and removed from consolidate statements.
IX. Interests in Other Entities
1. Interest in subsidiaries
(1) Composition of the group
Operating Registered Shareholding Acquisition
Company Business
location address Direct Indirect method
Designing,
manufacturing,
Fangda Jianke Shenzhen Shenzhen 98.39% 1.61% Established
and installation of
curtain walls
Installation and
Fangda
Shenzhen Shenzhen processing of 94.08% 5.92% Established
Automatic
metro screen door
Fangda New Production and
Nanchang Nanchang 75.00% 25.00% Established
Material sales of new-type
146
China Fangda Group Co., Ltd. 2014 Annual Report
materials
composite
materials and
production of
curtain walls
Design,
production, sales
and installation of
curtain wall
Fangda
Nanchang Nanchang aluminum 100.00% Established
Aluminium
materials, doors,
windows and
sectional
materials
HK Junjia Hong Kong Hong Kong Investment 100.00% Established
Manufacturing of
semiconductor
lighting material
and chips;
lighting source
encapsulation;
developing,
Shenyang Fangda Shenyang Shenyang 64.58% Established
designing,
manufacturing,
engineering,
installation and
trading of
semiconductor
lighting system
Developing of
hardware and
software, system
Kexunda Shenzhen Shenzhen 100.00% Established
integration,
technical
consulting
Real-estate
development and
Fangda Property Shenzhen Shenzhen operation; 100.00% Established
property
management
Fangda New Design and
Shenzhen Shenzhen 100.00% Established
Energy construction of
147
China Fangda Group Co., Ltd. 2014 Annual Report
PV power plants
Trusted
processing of
Chengdu Fangda Chengdu Chengdu 100.00% Established
building curtain
wall materials
Shihui
International Virgin Islands Virgin Islands Investment 100.00% Established
Holding Co., Ltd.
Installation and
Dongguan New
Dongguan Dongguan sales of building 100.00% Established
Material
curtain walls
Designing,
Shenyang manufacturing,
Shenyang Shenyang 100.00% Established
Decoration and installation of
curtain walls
Installation of
LED color curtain Under different
Shenzhen Woke Shenzhen Shenzhen 64.58%
wall, city and control
road lamps
Production and
Under different
Fangda SOZN Zhongshan Zhongshan sales of lights and 60.00%
control
LED products
R&D, design and
production of
Fangda Yide Shenzhen Shenzhen new-type 75.00% 25.00% Established
composite
materials
(2) Important partially-owned subsidiaries
In RMB
Minority shareholder
Minority shareholding Gain/loss attributed to Dividends distributable
Company equity balance at the end
percentage minority shareholders to minority shareholders
of the period
Shenyang Fangda 35.42% -5,803,503.04 0.00 52,387,418.95
Fangda SOZN 40.00% 1,728,063.47 0.00 16,208,466.21
(3) Financial information of important partially-owned subsidiaries
In RMB
Compan Closing balance Ending balance
148
China Fangda Group Co., Ltd. 2014 Annual Report
y Non-curr Non-curr Non-curr Non-curr
Current Total of Current Total Current Total of Current Total
ent ent ent ent
asset assets liabilities liabilities asset assets liabilities liabilities
assets liabilities assets liabilities
Shenyan 11,169,3 102,807, 113,977, 25,118,9 25,118,9 13,573,8 110,103, 123,677, 18,434,2 18,434,2
g Fangda 16.98 842.68 159.66 35.62 35.62 15.84 435.92 251.76 08.29 08.29
Fangda 98,422,1 24,060,4 122,482, 111,961, 111,961,
SOZN 61.21 01.24 562.45 396.93 396.93
In RMB
Amount occurred in the current period Occurred in previous period
Cash flow Cash flow
Company Total of misc. from Total of misc. from
Turnover Net profit Turnover Net profit
incomes operating incomes operating
activities activities
Shenyang -16,384,819.4 -16,384,819.4 -11,845,430.1 -11,845,430.1
-95,859.16 -850,952.79 -285,099.80
Fangda 3 3 4 4
Fangda 95,761,317.8 -13,259,799.7
4,320,158.67 4,320,158.67
SOZN 4 3
2. Interest in joint venture arrangement or affiliates
Financial information of no longer important affiliate
Closing amount/this Opening amount/last
Item
period period
Affiliate
Total book value of investment 11,048,660.43 9,994,565.55
Total of the shareholding of the following
items
Net profit 1,058,094.88 -5,434.45
Other misc. income
Total misc. income 1,058,094.88 -5,434.45
X. Financial Tools and Risk Management
Details about the Group's financial instruments are disclosed in related notes. The following
explains risks related to the financial instruments and risk management policies adopted by the
Group to lower the risks. The management of the Group manages and monitor the risks to ensure
that the risks are within the acceptable range.
1. Risk management target and policy
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The taget of the risk management is to balance between risk and benefit and lower financial risks’
impacts on the Group’s financial performance. Based on the target, the Group has formulated risk
management policy to identify and analyze risks facing the Group and set an appropriate acceptable
level and internal control procedures to monitor the risks. The Group regularly reviews the risk
management policies and related internal control system to suit the market status and changes in the
Group’s operating activities. The internal auditing department of the Group will regularly or
randomly check the implementation of the internal control system.
Risks caused by the Group’s financial instruments are interest risk, exchange rate risk, credit risk
and liquidity risk.
(1) Market risk
Market risk of financial instrument is caused by changes in the fair value of financial instruments or
future cash flow, including interest risk, exchange rate and other price risks.
Interest rate risk
Interest rate risk is caused by fluctuation of the fair value or future cash flow of financial
instruments caused by changes in the market interest rate. The interest rate risk can be caused by
recognized interest-bearing financial instruments and unrecognized financial instruments.
The Group's interest rate risk is mainly caused by short-term borrowings. Financial liabilities with
floating interest rate cause cash flow interest rate risk for the Group. Financial liabilities with fixed
interest rate cause fair value interest rate risk for the Group. The Group decides the proportion
between fixed interest rate and floating interest rate according to the market environment and
regularly reviews and monitors the combination of fixed and floating interest rate instruments.
On December 31, 2014, if the interest rate of borrowings with floating interest rates rises or drops
50 base points, the net profit of the Group and shareholders’ interest will decrease or increase about
RMB30,694.44.
Exchange rate risk
Exchange rate risk is caused by fluctuation of the fair value or future cash flow of financial
instruments caused by changes in the foreign exchange rates. The exchange rate risk can be caused
by financial instruments priced in foreign currencies.
The Group mainly operates in China and use RMB as the settlement currency. Therefore, the
exchange rate risk facing the Group is minor.
See foreign currency item note for the Group’s financial assets and liabilities priced in foreign
currencies.
(2) Credit risk
Credit risk is caused by the failure of one party of a financial instrument in performing its
obligations, causing the risk of financial loss for the other party.
The Group manages credit risks through classification. The credit risk is mainly caused by bank
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China Fangda Group Co., Ltd. 2014 Annual Report
deposit and receivables.
The Group’s bank deposit is mainly deposited in state-owned banks and large-sized listed banks.
The credit risk caused by bank deposited is minor.
For receivables, the Group sets up related policies to control the credit risk. The Group set the credit
line and term for debtors according to their financial status, external rating, and possibility of
getting third-party guarantee, credit record and other factors. The Group regularly monitors debtors’
credit record. For those with poor credit record, the Group will send written payment reminders,
shorten or cancel credit term to lower the general credit risk.
The largest credit risk facing the Group is the book value of each financial asset on the balance
sheet. The Group makes no guarantee that may cause the Group credit risks.
Among the Group’s receivables, accounts receivable from top 5 customers account for 11.26% of
the total accounts receivable (2013: 15%); among other receivables, other receivables from top 5
customers account for 27.06% of the total other receivables (2013: 23.49%).
(3) Liquidity risk
Liquidity risk is the risk of capital shortage when the Group needs to pay cash or settled with other
financial assets.
The Group keeps adequate cash and cash equivalent, and monitors the level to ensure that the cash
and cash equivalent can meet the operation needs. The management of the Group monitors the use
of bank loans and ensures that they are used as agreed. The Group also obtains guarantee from
financial institutions for adequate standby fund to meet short-term and long-term capital demand.
The Group can also use fund generated by operating activities and bank and other loans. On
December 31, 2014, bank loan credit that the Group has not used was RMB1,046,395,900.
Financial liabilities and excluded guarantees held by the Group by undiscounted residual contract cash flow (in
RMB10,000) at the end of the period:
Closing amount
Assets
Less than 1 year Within 1-3 years Over 3 years Total
Financial liabilities:
Short-term loans 110,000.00 110,000.00
Notes payable 22,726.65 22,726.65
Account payable 68,359.80 25.50 125.53 68,510.83
Interest payable 205.59 205.59
Other payables 4,535.77 206.80 4,742.57
Non-current liabilities due in 1 year 600.00 600.00
Long-term payable 600.00 600.00
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Total liabilities 206,427.81 832.30 125.53 207,385.64
Financial liabilities and excluded guarantees held by the Group by undiscounted residual contract cash flow (in RMB10,000) at the
beginning of the period:
Opening amount
Assets
Less than 1 year Within 1-3 years Over 3 years Total
Financial liabilities: -
Short-term loans 36,900.00 36,900.00
Notes payable 18,857.09 18,857.09
Account payable 48,921.61 48,921.61
Interest payable 68.92 68.92
Other payables 2,815.24 1,353.52 4,168.76
Total liabilities 107,562.86 1,353.52 108,916.38
2. Capital management
The Group’s capital management aims to ensure continuous operation of the Group, provide returns for
shareholders, help other interested parties make benefit, and maintain the best capital structure and lower capital
cost.
The Group may adjust the dividend distributed to shareholders, issue new shares or sell assets to maintain or
adjust the capital structure.
The Group monitors the capital structure based on the assets/liability ratio. On December 31, 2014, the Group’s
assets/liability ratio is 64.49% (December 31, 2013: 53.22%).
XI. Disclosure of fair value
1. Closing fair value of assets and liabilities measured at fair value
In RMB
Closing fair value
Items
First level fair value Second level fair value Third level fair value Total
1. Continuous fair value
-- -- -- --
measurement
(2) Investment in equity
13,410,790.00 13,410,790.00
tools
2. Leased building 198,513,586.15 198,513,586.15
Total assets measured at
13,410,790.00 198,513,586.15 211,924,376.15
fair value continuously
2. Discontinuous fair
-- -- -- --
value measurement
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China Fangda Group Co., Ltd. 2014 Annual Report
2. Determination basis for continuous and discontinuous first level fair value measurement
The Group determines the fair value using quotation in an active market for financial instruments traded in an
active market;
3. Continuous and discontinuous second level fair value measurement items, valuation techniques,
important qualitative and quantitative information
For investment in real estate similar with real estate transaction, the Group uses valuation techniques to determine
its fair value. The technique is comparison method. Inputs include transaction date, status, region and other
factors.
4. Continuous fair value measurement items, switch between different levels, reason and switching policies
In the period, there is no switch in the financial assets measured at fair value between the first and second level or
transfer in or out of the third level.
5. Change in valuation technique and reason
None
6. Fair value of financial assets and liabilities not measured at fair value
The difference between book value and fair value of financial assets and liabilities not measured at fair value is
small.
7. Others
None
XII. Related parties and transactions
1. Parent of the Company
Share of the parent Voting power of the
Parent Registered address Business Registered capital
co. in the Company parent company
Shenzhen Banglin
Technologies
Shenzhen Industrial investment RMB30 million 9.09% 9.09%
Development Co.,
Ltd.
Shenzhen Shilihe
Shenzhen Industrial investment 19,780,992 2.36% 2.36%
Investment Co., Ltd.
Shengjiu Investment
Hong Kong Industrial investment HKD1.00 5.00% 5.00%
Ltd.
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China Fangda Group Co., Ltd. 2014 Annual Report
Particulars about the parent of the Company
1. All of the investors of Shenzhen Banglin Technology Development Co., Ltd. – the holding shareholder of the
Company, are natural persons. Among them, Chairman Xiong Jianming is holding 85% of the shares, and Mr.
Xiong Xi – son of Mr. Xiong Jianming, is holding 15% of the shares.
2. Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu
Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and
Shenzhen Shilihe Investment Co., Ltd. are related parties. The Company is not notified of other
action-in-concert or related parties among the other holders of current shares.
The final controller is Xiong Jianming.
2. Subsidiaries of the Company
See Note IX, 1 for the details.
XIII. Contingent events
1. Contingencies
(1) Contingencies on the balance sheet date
(1) Contingent liabilities formed by material lawsuit or arbitration, and their influences on the financial position
Plaintiff Defender Case Court Target Progress
amount
st
Wang Weihong Fangda Jianke Engineering The 1 Middle RMB17.07 Trial of second
dispute Court of million and its instance
Chongqing interest
In 2010, Wang Weihong filed a lawsuit to the 1st Middle Court of Chongqing against Fangda Jianke, demanding
engineering payment and loss of RMB17.07 million and interest. On June 19, 2014, the court made the
first-instance judgment (201) Yu 1st Court No.00128. Fangda Jianke is required to pay RMB14,015,908.19 and
interest to Wang Weihong in 10 days upon the effectiveness of the judgment and refund deposit of
RMB1,655,000.00 and interest to Wang Weihong. Fangda Jianke appeal to Chongqing Senior People’s Court.
The second trial is in progress on the report date. Fangda Jianke has made liability provision of RMB5.039 million
according to the judgment of the first trial. Fangda Jianke also filed a lawsuit against Wang Weihong and
demanded an engineering payment and compensation of RMB18 million An amount of RMB12 million in the
bank account of Fangda Jianke has been frozen by the court.
(2) Important contingencies that dont need to be disclosed but need to be explained
None
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China Fangda Group Co., Ltd. 2014 Annual Report
2. Others: None
XIV. Post-balance-sheet events
1. Important non-adjustment item: None
2. Profit distribution
In RMB
Profit or dividend to be distributed 22,707,297.10
Profit or dividend approved to be distributed
3. Sales return: None
4. Notes to other issues in post balance sheet period: None
XV. Other material events
1. Suspended business
In RMB
Net profit
Income tax attributable to the
Items Income Expense Total profit Net profit
expenses owners of parent
company
Suspend business
3,195,855.07 17,153,885.09 -13,958,030.02 -13,958,030.02 -7,920,881.45
revenue
Notes
(1) Shenyang Fangda has been suspended from operating since 2012 and is in the liquidation process. Shenzhen
Woke has been liquidated according to the resolution of the Shareholders’ Meeting, the company's business has
been suspended. Fangda Yide was liquidated in 2014. Fangda Aluminium has been suspended from operating
since 2011 and is in the liquidation process.
(2) The net profit from suspended business in 2014 includes: the net project of RMB-17,044,462.38 of Shenyang
Fangda and its subsidiaries, RMB158,530.86 of Fangda Yide and RMB2,927,901.50 of Fangda Aluminium.
(3) The net profit from suspended business in 2013 includes: the net project of RMB-12,072,513.31 of Shenyang
Fangda and its subsidiaries, RMB158,530.86 of Fangda Yide and RMB2,927,901.50 of Fangda Aluminium.
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2. Segment information
(1) Reporting segment determination basis and accounting policy
The Group divides its businesses into five reporting segments. The reporting segments are determined based on
financial information required by routine internal management. The Group’s management regularly review the
operating results of the reporting segments to determine resource distribution and evaluate their performance.
The reporting segments are:
(1) Curtain wall segment, production and sales of curtain wall materials, construction curtain wall design,
production and installation;
(2) Rail transport segment, assembly and processing of metro screen doors;
(3) Real estate segment, development and operating of real estate on land of which land use right is legally
obtained by the Company; property management;
(4) New energy segment, R&D, installation and sales of PV devices, design and construction of PV power plants;
R&D, design, production, sales and installation of light accessories, and other lights, LED products and hardware.
(5) Others
The segment report information is disclosed based on the accounting policies and measurement standards used by
the segments when reporting to the management. The policies and standards should be consistent with those used
in preparing the financial statement.
(2) Financial information of reporting segments
(1) Segment profit or loss, assets and liabilities
This period or end of this Curtain wall Rail transport Real estate New energy Others Offset Total
period
Turnover 1,661,248,718.96 164,055,611.07 2,013,839.96 95,761,317.84 29,609,371.13 14,364,423.45 1,938,324,435.51
Including: external 1,656,916,307.20 163,281,339.00 95,761,317.84 22,365,471.47 1,938,324,435.51
transaction income
Inter-segment 4,332,411.76 774,272.07 2,013,839.96 7,243,899.66 14,364,423.45 -
transaction income
Including: major 1,647,897,816.63 160,427,755.07 92,516,175.40 4,308,171.64 1,896,533,575.46
business turnover
Operation cost 1,391,336,171.77 118,320,893.63 - 80,611,629.14 5,669,281.13 5,101,189.65 1,590,836,786.02
Including: major 1,384,070,778.59 116,907,821.10 77,403,664.46 5,250,618.98 1,573,131,645.17
business cost
Business expense 188,366,206.12 26,148,333.72 5,023,251.58 10,224,044.08 -15,730,365.23 -28,930,834.07 242,962,304.34
Operating profit/(loss) 81,546,341.07 19,586,383.72 -3,009,411.62 4,925,644.62 39,670,455.23 38,194,067.87 104,525,345.15
Total assets 2,696,787,412.01 403,424,853.36 875,469,981.13 212,477,809.8 2,012,145,066.90 2,537,585,222.82 3,662,719,900.41
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China Fangda Group Co., Ltd. 2014 Annual Report
3
Total liabilities 1,828,471,033.63 213,625,244.55 678,400,713.51 94,316,598.44 771,716,371.36 1,224,344,689.07 2,362,185,272.42
Last period or end of last Curtain wall Rail transport Real estate New energy Others Offset Total
period
Turnover 1,615,770,830.70 109,386,493.23 686,160.04 44,439,832.54 22,662,470.77 1,747,620,845.74
Including: external 1,614,569,290.76 98,493,487.64 34,558,067.34 1,747,620,845.74
transaction income
Inter-segment 1,201,539.94 10,893,005.59 686,160.04 9,881,765.20 22,662,470.77
transaction income
Including: major 1,602,159,942.22 97,497,470.54 1,928,835.57 1,697,728,577.19
business turnover
Operation cost 1,345,014,568.09 84,836,442.32 10,834,093.34 15,315,899.33 1,425,369,204.42
Including: major 1,339,429,169.22 74,237,530.43 841,469.94 1,412,825,229.71
business cost
Business expense 189,120,439.96 15,672,530.75 1,245,190.31 24,421,736.04 2,607,315.96 227,852,581.10
Operating profit/(loss) 81,635,822.65 8,877,520.16 -559,030.27 9,184,003.16 4,739,255.48 94,399,060.22
Total assets 2,093,240,742.30 355,159,698.99 360,666,929.02 1,660,494,495.61 1,870,004,323.35 2,599,557,542.57
Total liabilities 1,486,596,070.19 154,191,112.44 311,112,848.14 433,684,819.46 1,002,099,485.40 1,383,485,364.83
(2) Others
① Product and external labor transaction income
Items Amount occurred in the current Occurred in previous period
period
Metal production 1,643,589,644.97 1,600,231,106.65
Railroad industry 160,427,755.09 97,497,470.54
Light production 92,516,175.40
Total 1,896,533,575.46 1,697,728,577.19
②Regional information
Since more than 90% of the Group’s revenue comes from Chinese customer and 90% of the Group’s assets are in
China, no detailed regional information is needed.
3. Other significant transaction and items with impacts on investors
1. Acquisition of shares of Fangda SOZN
(1) About the acquisition
Fangda New Energy entered into an investment agreement with Luo Huichi on July 18, 2014. According to the
agreement, Fangda Energy and Shenzhen Jinma Yinke entered into a share transfer agreement on July 29, 2014.
The transaction does not constitute a related transaction or material asset restructuring. Therefore, the transaction
157
China Fangda Group Co., Ltd. 2014 Annual Report
does not need to be submitted to the Board of Directors for discussion according to the Company’s Articles of
Association.
Content of the investment and share transfer agreement:
1. Terms of the transaction
Luo Huichi makes contribution to a newly established company with limited liability using fixed assets, intangible
assets, sales network and teams in three companies under her actual control: Zhongshan SOZN Lighting,
Zhongshan Henglan Tengding Lighting Factory, Shenzhen Jinma Yinke. The new company is named as
Guangdong Fangda SOZN Lighting Co., Ltd. (hereinafter referred to as Target Company). After confirming the
Target Company’s assets, both parties entered into the stock transfer and capital increment agreement, under
which the Company acquires 60% stack in the Target Company by acquiring stocks and injecting capital.
2. Transaction amount
The acquisition amount does not exceed RMB48 million, including a conditional payment to Luo Huichi of
RMB18 million and a conditional capital injection to the Target Company of RMB30 million.
3. Payment term
The stock transfer amount is up to RMB18 million. The Company shall pay the amount to Luo Huichi in three
installments: The first installment of RMB 6million shall be paid after both parties sign the stock transfer
agreement, complete the transfer and registration procedures, and the Company holds 60% of the Target
Company’s stocks. The second installment of RMB 6million shall be paid after the Target Company realizes 90%
or higher of the sales or net profit target for 2014 (between July and December); the first installment of RMB6
million will be paid after the Target Company realizes 90% or higher of the sales or net profit target for 2015. If
the conditions for the second and third installments are not met, the Company does not need to pay the stock
transfer amounts to the Counterpart and the 60% shareholding of the Target Company by the Company remains
unchanged.
The Company will provide interest-free loans of RMB30 million to the Target Company with a mature date of
December 31, 2016 after the share transfer agreement is signed, both parties complete the commercial and
industrial registration, the Company holds 60% of the Target Company’s shares. If the Target Company
completes 90% of the sales target or accumulative net profit target between July 2014 and December 2016, the
loans will be transferred to the acquisition payment of 60% of the Target Company and the Target Company does
not need to repay the loans. Otherwise, Luo Huichi shall transfer 30% of the Target Company’s shares held by her
to the Company at the price of RMB1/share.
4. Result guaranty
Period Target sales (tax-inclusive) Target net profit
July to December, 2014 RMB150 million RMB3 million
July to December, 2015 RMB600 million RMB36 million
July to December, 2016 RMB1 billion RMB60 million
Total RMB1.75 billion RMB99 million
5. Special agreement
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China Fangda Group Co., Ltd. 2014 Annual Report
Luo Huichi agrees to sign a three-year labor contract, non-disclosure agreement and non-competition agreement
with the Target Company and agrees not to be involved in the same or similar business directly, indirectly, paid or
not paid, full-time or part-time, by starting a company or cooperating with others. If Luo fails to honor the
guaranty, the Company has the right to terminate the agreement and require Luo to return the stock transfer
amount and bear the liability of the breach.
Both parties agree that the Target Company will not distribute profit between July 2014 and December 2016,
which will be fully used to push the development of the Target Company.
(2) Performance in 2014
Between July and December 2014, Fangda SOZN recorded a tax-included income of RMB136,832,908.41 and net
profit of RMB521,165.52, reaching 90% of the sales target for 2014. Fangda New Energy made the second
installment of RMB6 million to Shenzhen Jinma Yinke.
2. Private share issuance
The Group’s private share issuance proposal was approved at the 8th meeting of the 7th Board of Directors held on
December 23, 2014. The shares will be issued privately to specific subscribers. The Company will issue shares to
no more than 10 specific subscribers including the Company’s largest shareholder Shenzhen Banglin
Technologies Development Co., Ltd. (Banglin Technology) when appropriate within 6 months upon approval by
CSRC. RMB common shares (A-shares) will be issued this time with a par value of RMB1.00. A-shares issued
this time will not be more than 105,000,000 million shares (inclusive). In case ex-dividend or ex-interest events
happened during the period from pricing ex-day to issuing day, such as dividend distribution, bonus shares, or
capitalizing of common reserves, the amount shall be adjusted correspondingly. The finally issued amount will
be determined by the Board of Directors authorized by the Shareholders’ Meeting and the sponsor (major
underwriter) according to regulations and actual conditions. The shares will be issued to no more than 10 specific
subscribers including the Company’s largest shareholder Banglin Technology, which will subscribe for the shares
with RMB201,600,000 (accounting for 20% of the maximum raised amount of RMB1,008,000,000 of the private
issuing). The subscribers shall subscribe for the shares in cash. The other subscribers are no more than nine
specific investors including eligible securities investment fund management companies, securities companies,
trust investment companies, financial companies, insurance institutional investors, eligible overseas institutional
investors, other domestic corporate investors and natural persons according to CSRC. Two or more fund
subscribers managed by one securities investment fund management company are one subscriber. A trust
company subscriber shall subscribe the shares with its own fund.
The pricing ex-date will be the day when the announcement of resolutions of the 8 th meeting of the 7th
Board of Directors. The price will be 90% of the average price in 20 days prior to the pricing ex-date,
namely RMB9.85 per share. The average price in 20 days prior to the pricing ex-date = total dealing
amount in the days prior to the pricing ex-date/total number of shares dealt in the 20 days prior to the
pricing ex-date. In case ex-dividend or ex-interest events happened during the period from pricing ex-day to
issuing day, such as dividend distribution, bonus shares, or capitalizing of common reserves, the price shall be
adjusted according to the following formula:
Assume that the base issuing price before adjustment is P0, N share(s) is distributed for each share, D is
distributed as cash dividend for each share, the base issuing price after adjustment is P1 (the figure is rounded to
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China Fangda Group Co., Ltd. 2014 Annual Report
two decimal places when the number is larger than 4):
Cash dividend: P1=P0－D
Share dividend or transfer of capital to shares: P1=P0/(1+N)
Both: P1=(P0-D)/(1+N)
The final issuing price is to be determined by the Board of Directors and sponsor (principal underwriter)
according to the price priority principle based on the investor subscription price after the Board of Directors
receives approval of the issuance from CSRC with the authorization by the Shareholders’ Meeting. Banglin
Technology does not participate in the market enquiry process and agrees to accept the bidding result and
subscribe for the shares with other investors at the same price. Where no other investors bid, the subscription
price for Banglin Technology will be the base issuing price.
Shares subscribed by Banglin Technology at this private issuing are not allowed to be transferred in 36 months
since the closing day of this private issuing. Shares subscribed by other investors at this private issuing are not
allowed to be transferred in 12 months since the closing day of this private issuing.
Upon accomplishing of the issuing, the new shareholders will share the retained profit in the previous years along
with the existing shareholders.
3. Assets and liabilities measured at fair value
(1) Assets of the Group measured at fair value are investment real estate and financial assets
measured at fair value and change including the gain of the current period. Investment real estate's
fair value is adjusted when necessary using quotation of similar asset in an active market or same or
similar asset in an inactive market. The closing value is RMB198,513,586.15; financial assets
measured at fair value and of which changes are including in gain/loss in the current period, the fair
value is determined by quotation in an active market. The closing value is RMB13,410,790.00.
(2) Assets measured at fair value
Accumulative
changes in fair
Gain/loss
value Provision
caused by
Items Opening amount accounting Closing amount
changes in Impairment
into the
fair value
income
account
34,897,632.1 91,831.6 198,513,586.1
Investment real estate 174,778,756.62
0 3 5
Financial assets
measured at fair
value with
variations -2,852,885.00 13,410,790.00
accounted into
current income
account
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China Fangda Group Co., Ltd. 2014 Annual Report
XVI. Notes to Financial Statements of the Parent
1. Account receivable
(1) Account receivable are disclosed by categories
In RMB
Closing balance Ending balance
Bad debt provision Bad debt provision
Remaining book Remaining book
balance at the end balance at the end of
Type value Book value
of the period the period Book value
value
Proportio Provision Proportio Provision
Amount Amount Amount Amount
n rate n rate
Recognition and
527,485. 15,824.5 511,660.6 623,154
providing of bad debt 100.00% 3.00% 100.00% 18,694.62 3.00% 604,459.49
15 5 0 .11
provisions on groups
527,485. 15,824.5 511,660.6 623,154
Total 100.00% 3.00% 100.00% 18,694.62 3.00% 604,459.49
15 5 0 .11
Account receivable with major individual amount and bad debt provision provided individually at the end of the
period:
□ Applicable √ Inapplicable
In the group, the account receivable of which bad debt provision is made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Closing balance
Age Bad debt provision balance at
Account receivable Provision rate
the end of the period
Items less than 1 year
Less than 1 year 527,485.15 15,824.55 3.00%
Subtotal for less than 1 year 527,485.15 15,824.55 3.00%
Total 527,485.15 15,824.55 3.00%
Note:
Account receivable adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB-2,870.07 were made in this period; none was recovered or reversed in this period.
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China Fangda Group Co., Ltd. 2014 Annual Report
(3) Top 5 account receivable entities at the end of the period
The total balance of accounts receivable due from top 5 account receivable entities at the end of the period is
RMB348,543.92, accounting for 66.08% of the aggregate. Bad debt provisions made totaled RMB10,456.32 at the
end of the period.
2. Other receivables
(1) Other receivables are disclosed by categories
In RMB
Closing balance Ending balance
Bad debt provision Bad debt provision
Remaining book Remaining book
balance at the end balance at the end of
Type value Book value
of the period the period Book value
value
Proportio Provision Proportio Provision
Amount Amount Amount Amount
n rate n rate
Recognition and
255,152, 548,475. 254,604,1 572,239 619,111.5 571,620,65
providing of bad debt 99.97% 0.21% 99.99% 0.11%
639.18 39 63.79 ,771.28 5 9.73
provisions on groups
Account receivable
with minor individual
77,046.0 77,046.0 77,046.
amount and bad debt 0.03% 100.00% 0.01% 77,046.00 100.00%
0 0 00
provision provided
individually
255,229, 625,521. 254,604,1 572,316 696,157.5 571,620,65
Total
685.18 39 63.79 ,817.28 5 9.73
Other receivables with major individual amount and bad debt provision provided individually at the end of the
period:
□ Applicable √ Inapplicable
In the group, the other receivables of which bad debt provision are made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Closing balance
Age Other receivables at the end of Bad debt provision balance at
Provision rate
the period the end of the period
Items less than 1 year
Less than 1 year 68,253.65 2,047.61 3.00%
Subtotal for less than 1 year 68,253.65 2,047.61 3.00%
1-2 years 35,000.00 3,500.00 10.00%
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China Fangda Group Co., Ltd. 2014 Annual Report
2-3 years 46,753.35 14,026.01 30.00%
Over 3 years 1,057,803.54 528,901.77 50.00%
Total 1,207,810.54 548,475.39 45.41%
Note:
Other receivables adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
Other receivables adopting other methods in the group:
□ Applicable √ Inapplicable
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB-70,636.16 were made in this period; none was recovered or reversed in this period.
(3) Other receivables disclosed by nature
In RMB
By account Closing balance of book value Opening balance of book value
Payments between counterparts 253,944,828.64 570,338,916.39
Lent to employee 20,152.00
Deposit 100,699.54 100,699.54
Other trades 1,184,157.00 1,857,049.35
Total 255,229,685.18 572,316,817.28
(4) Top 5 other receivable entities at the end of the period
In RMB
Bad debt provision
Percentage in the
Entity By account Closing balance Age balance at the end of
aggregate
the period
Shenzhen Fangda
Property
Trades 133,179,160.80 Less than 1 year 52.18%
Development Co.,
Ltd.
Shenzhen Fangda
Jianke Group Co., Trades 82,615,134.19 Less than 1 year 32.37%
Ltd.
HK Junjia Trades 83,183.13 Less than 1 year 0.03%
HK Junjia Trades 3,230.36 1-2 years
HK Junjia Trades 6,529.28 2-3 years
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China Fangda Group Co., Ltd. 2014 Annual Report
HK Junjia Trades 30,380,251.73 Over 3 years 11.90%
Shenyang Fangda
Semi-conductor Trades 6,906,771.58 Over 3 years 2.71%
Lighting Co., Ltd.
Shenzhen Woke
Semi-conductor Trades 630,000.00 Less than 1 year 0.25%
Lighting Co., Ltd.
Shenzhen Woke
Semi-conductor Trades 2,342.08 2-3 years
Lighting Co., Ltd.
Shenzhen Woke
Semi-conductor Trades 106,411.33 Over 3 years 0.04%
Lighting Co., Ltd.
Total -- 253,913,014.48 -- 99.48%
3. Long-term share equity investment
In RMB
Closing balance Ending balance
Items Remaining book Impairment Remaining book Impairment
Book value Book value
value provision value provision
Investment in
1,166,555,998.58 46,930,100.00 1,119,625,898.58 749,452,105.58 39,718,360.00 709,733,745.58
subsidiaries
Investment in
11,048,660.43 11,048,660.43 9,994,565.55 9,994,565.55
affiliates
Total 1,177,604,659.01 46,930,100.00 1,130,674,559.01 759,446,671.13 39,718,360.00 719,728,311.13
(1) Investment in subsidiaries
In RMB
Impairment
Provision made in provision balance
Invested entity Ending balance Increase Decrease Closing balance
this period at the end of the
period
Fangda Jianke 305,000,000.00 186,950,000.00 491,950,000.00
Fangda
19,800,000.00 19,800,000.00 19,800,000.00
Aluminium
Fangda Yide 19,907,760.00 19,907,760.00
HK Junjia 10,600.00 10,600.00 10,600.00
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China Fangda Group Co., Ltd. 2014 Annual Report
Fangda Automatic 170,385,071.73 170,385,071.73
Fangda New
74,496,600.00 74,496,600.00
Material
Shenyang Fangda 108,852,073.85 108,852,073.85 27,119,500.00 27,119,500.00
Kexunda 1,000,000.00 1,000,000.00
Fangda Property 50,000,000.00 150,000,000.00 200,000,000.00
Shihui
International 61,653.00 61,653.00
Holding Co., Ltd.
Fangda New
100,000,000.00 100,000,000.00
Energy
Total 749,452,105.58 437,011,653.00 19,907,760.00 1,166,555,998.58 27,119,500.00 46,930,100.00
(2) Investment in affiliate
Invested entity Opening amount Increase Decrease Closing amount
Affiliate:
Shenzhen Ganshang
Joint Investment Co., 9,994,565.55 1,054,094.88 11,048,660.43
Ltd.
(3) Others
4. Operational revenue and costs
In RMB
Amount occurred in the current period Occurred in previous period
Items
Income Cost Income Cost
Other business 29,609,371.13 5,669,281.13 45,659,921.07 10,980,932.52
Total 29,609,371.13 5,669,281.13 45,659,921.07 10,980,932.52
5. Investment income
In RMB
Items Amount occurred in the current period Occurred in previous period
Gains from long-term equity investment
28,639,627.17
measured by costs
Gains from long-term equity investment
1,054,094.88 -5,434.45
measured by equity
Other investment gains 111,670.20
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China Fangda Group Co., Ltd. 2014 Annual Report
Total 29,805,392.25 -5,434.45
6. Others
XVII. Supplementary Materials
1. Detailed accidental gain/loss
In RMB
Items Amount Notes
Gain/loss of non-current assets -24,398.43
Subsidies accounted into the current income
account (except the government subsidy
closely related to the enterprise’s business 2,340,175.75
and based on unified national standard
quota)
Capital using expense charged to
non-financial enterprises and accounted into 3,649,313.12
the current income account
Gain from entrusted investment or assets
2,144,844.80
management
Gain/loss from change of fair value of
transactional financial asset and liabilities,
and investment gains from disposal of
transactional financial assets and liabilities -2,852,885.00
and sellable financial assets, other than valid
period value instruments related to the
Company’s common businesses
Gain/loss from change of fair value of
investment property measured at fair value 34,897,632.10
in follow-up measurement
Other non-business income and expenditures
-3,671,724.03
other than the above
Less: Influenced amount of income tax 9,526,862.57
Influenced amount of minority shareholders’
-973,756.92
equity
Total 27,929,852.66 --
Explanation statement should be made for accidental gain/loss items defined and accidental
gain/loss items defined as regular gain/loss items according to the Explanation Announcement of
Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable √ Inapplicable
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China Fangda Group Co., Ltd. 2014 Annual Report
2. Net income on asset ratio and earning per share
Earning per share
Profit of the report period Weighted average net income/asset ratio Basic earnings per share Diluted Earnings per
(yuan/share) share (yuan/share)
Net profit attributable to common
8.14% 0.13 0.13
shareholders of the Company
Net profit attributable to the
common owners of the PLC after
5.79% 0.09 0.09
deducting of non-recurring
gains/losses
3. Differences in accounting data under domestic and foreign accounting standards
(1) Differences in net profits and assets in financial statements disclosed according to the international and
Chinese account standards
In RMB
Net profit Net assets
Amount occurred in the Occurred in previous
Closing balance Ending balance
current period period
On Chinese accounting
96,998,429.76 85,676,863.78 1,234,930,863.46 1,160,639,730.85
standards
Items and amounts adjusted according International Accounting Standards
On international
96,998,429.76 85,676,863.78 1,239,694,261.70 1,165,403,129.09
accounting standards
(2) Differences in net profits and assets in financial statements disclosed according to the international and
Chinese account standards
□ Applicable √ Inapplicable
(3) Where the data audited by overseas auditor has been adjusted, the name of the overseas auditor should
be specified.
Net assets attributable to the listed company’s shareholders calculated according to the IAS is RMB4,763,398.24
higher than that calculated according to the domestic accounting standards, mainly attributable to the
capitalization of borrow expenses before the domestic Enterprise Accounting Standard was implemented on
January 1, 2007.
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China Fangda Group Co., Ltd. 2014 Annual Report
4. Supplementary material related to changes to accounting policies
√ Applicable □ Inapplicable
According to the eight modified accounting standards including Enterprise Accounting Standard No.2 –
Long-term Equity Investment, balance sheet from January 1, 2013 to December 31, 2013 is restated as follows:
In RMB
Items January 1, 2013 December 31, 2013 December 31, 2014
Current asset:
Monetary capital 278,283,968.61 333,876,921.97 212,430,798.87
Financial assets measured at
fair value with variations
13,410,790.00
accounted into current
income account
Notes receivable 7,638,780.88 21,898,770.43 83,325,725.70
Account receivable 774,890,805.30 898,780,981.93 1,105,242,251.46
Prepayment 22,006,159.22 28,364,016.21 29,234,231.49
Interest receivable 72,833.33 36,387.50
Other receivables at the end
57,339,556.28 66,298,730.17 48,950,647.67
of the period
Inventory 269,120,191.36 428,537,851.82 982,441,187.05
Other current assets 234,986,107.72
Total current assets 1,409,352,294.98 1,777,793,660.03 2,710,021,739.96
Non-current assets:
Long-term share equity
9,994,565.55 11,048,660.43
investment
Investment real estate 258,405,762.09 195,249,069.13 226,279,523.39
Fixed assets 341,555,810.21 462,930,269.98 489,714,684.63
Construction in process 175,138,694.28 940,841.00 341,749.17
Disposal of fixed assets 177,298.11 26,918.21
Intangible assets 102,380,382.21 91,527,650.52 98,947,331.09
R&D expense 67,700.00
Goodwill 26,279,395.89
Long-term amortizable
4,710,860.65 3,799,354.79 4,119,362.63
expenses
Deferred income tax assets 36,191,385.09 41,166,043.56 52,616,656.38
Other non-current assets 15,978,789.90 43,323,878.63
Total of non-current assets 918,450,594.53 821,763,882.54 952,698,160.45
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China Fangda Group Co., Ltd. 2014 Annual Report
Total of assets 2,327,802,889.51 2,599,557,542.57 3,662,719,900.41
Current liabilities
Short-term loans 181,970,000.00 369,000,000.00 1,100,000,000.00
Notes payable 160,779,777.03 188,570,850.63 227,266,485.57
Account payable 411,846,031.72 489,216,140.32 685,108,346.73
Prepayment received 77,741,903.02 168,386,251.94 122,285,231.14
Employees’ wage payable 23,945,272.55 30,182,851.80 41,703,314.26
Taxes payable 33,686,577.98 44,839,947.77 58,696,926.25
Interest payable 1,954,557.27 689,153.75 2,055,911.11
Other payables 41,340,056.86 41,687,580.72 47,425,682.44
Non-current liabilities due in
6,000,000.00
1 year
Other current liabilities 200,000,000.00
Total current liabilities 1,133,264,176.43 1,332,572,776.93 2,290,541,897.50
Non-current liabilities:
Long-term payable 7,700.00 6,000,000.00
Anticipated liabilities 5,859,045.98
Deferred earning 10,255,823.93 10,049,892.04
Deferred income tax
36,210,286.40 40,656,763.97 49,734,436.90
liabilities
Total of non-current
36,217,986.40 50,912,587.90 71,643,374.92
liabilities
Total liabilities 1,169,482,162.83 1,383,485,364.83 2,362,185,272.42
Owner’s equity:
Share capital 756,909,905.00 756,909,905.00 756,909,905.00
Capital reserves 79,099,220.38 79,099,220.38 79,099,220.38
Other miscellaneous income 1,200,647.26 91,831.63 91,831.63
Surplus reserves 30,494,542.94 46,389,142.21 48,842,080.76
Retained profit 230,907,879.99 278,149,631.63 349,987,825.69
Total of owner’s equity
1,098,612,195.57 1,160,639,730.85 1,234,930,863.46
belong to the parent company
Minor shareholders’ equity 59,708,531.11 55,432,446.89 65,603,764.53
Total of owners’ equity 1,158,320,726.68 1,216,072,177.74 1,300,534,627.99
Total liabilities and
2,327,802,889.51 2,599,557,542.57 3,662,719,900.41
shareholders’ equity
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China Fangda Group Co., Ltd. 2014 Annual Report
5. Others
None
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China Fangda Group Co., Ltd. 2014 Annual Report
XI Documents for Reference
1. The Annual Report 2014 and the Summary with signature of the legal representative (Chinese and English);
2. Accounting Statements with signatures and seals of the legal representative and financial principal and chief of
accounting department;
3. Original copy of the Auditors’ Report under the seal of the CPA and signed by and under the seal of certified
accountants.
4. Originals of all documents and manuscripts of Public Notices of the Company disclosed in public in the
newspapers as designated by China Securities Regulatory Commission.
171
