China Fangda Group Co., Ltd. 2015 Annual Report
China Fangda Group Co., Ltd.
2015 Annual Report
April 2016
1
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 1 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.
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.
Directors other than the following ones have attended the Board meeting to
review the annual report.
Name of absent director Position of absent director Reason Name of proxy
Deng Lei Independent director Business engagement Guo Wanda
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.
Management Discussion and Analysis.
The Board meeting reviewed and approved the profit distribution preplan:
distributing cash dividend of RMB1 for each ten shares to all shareholders on
the basis of all shares of the Company on 31.12.15 and no dividend share is
issued to shareholders. No reserve is capitalized.
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China Fangda Group Co., Ltd. 2015 Annual Report
Table of Contents
Chapter 1 Important Statement, Table of Contents and Definitions.........................................................................................................2
Charter 2 About the Company and Financial Highlights .........................................................................................................................6
Chapter 3 Business Introduction ............................................................................................................................................................ 11
Chapter 4 Management Discussion and Analysis ..................................................................................................................................14
Chapter 5 Significant Events .................................................................................................................................................................29
Chapter 6 Changes in Share Capital and Shareholders ..........................................................................................................................41
Chapter 7 Preferred Shares ....................................................................................................................................................................47
Chapter 8 Particulars about the Directors, Supervisors, Senior Management and Employees ..............................................................48
Chapter 9 Corporate Governance ..........................................................................................................................................................54
Chapter 10 Financial Statements ...........................................................................................................................................................63
Chapter 11 Documents for Reference ..................................................................................................................................................180
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China Fangda Group Co., Ltd. 2015 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 Formally Shenzhen Fangda Decoration Engineering Co., Ltd., now
Fangda Jianke, Fangda Decoration
to renamed 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.
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China Fangda Group Co., Ltd. 2015 Annual Report
to
Refers
Fangda Aluminium Jiangxi Fangda New Type Aluminum 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 renamed as
Chengdu Fangda Jianke
to Chengdu Fangda Construction Technology Co., Ltd.
Refers
Shihui International Shihui International Holding Co., Ltd.
to
Refers
Shenyang Decoration Fangda Decoration Engineering (Shenyang) Co., Ltd.
to
Refers
CSRC China Securities Regulatory Commission
to
Refers
SZSE Shenzhen Stock Exchange
to
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China Fangda Group Co., Ltd. 2015 Annual Report
Charter 2 About the Company and Financial Highlights
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
China Securities Journal, Security Times, Shanghai Securities Daily, Hong
Press medias 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. 2015 Annual Report
Place for information inquiry Secretarial Office of the Board
4. Registration changes
Organization code 19244858-9
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 Xie Peiren, Hu Gaosheng
Sponsor engaged by the Company to perform continued supervision and guide during the reporting period
□ Applicable √ Inapplicable
Financial advisor engaged by the Company to perform continued supervision and guide during the reporting
period
□ Applicable √ Inapplicable
6. 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
2015 2014 Increase/decrease 2013
Turnover (yuan) 2,550,467,494.78 1,938,324,435.51 31.58% 1,747,620,845.74
Net profit attributable to
shareholders of the listed company 107,272,369.77 96,998,429.76 10.59% 85,676,863.78
(yuan)
Net profit attributable to the
shareholders of the listed company
29,070,293.64 69,068,577.10 -57.91% 68,393,391.56
and after deducting of
non-recurring gain/loss (RMB)
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China Fangda Group Co., Ltd. 2015 Annual Report
Net cash flow generated by
-360,115,114.04 -557,893,929.44 156,544,620.31
business operation (RMB)
Basic earnings per share
0.14 0.13 7.69% 0.11
(yuan/share)
Diluted Earnings per share
0.14 0.13 7.69% 0.11
(yuan/share)
Weighted average net income/asset
8.42% 8.14% 0.28% 7.61%
ratio
Increase/decrease from
End of 2015 End of 2014 End of 2013
the end of last year
Total asset (RMB) 4,464,147,811.40 3,662,719,900.41 21.88% 2,599,557,542.57
Net profit attributable to the
shareholders of the listed company 1,319,496,334.84 1,234,930,863.46 6.85% 1,160,639,730.85
(RMB)
7. 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
listed company listed company
This period Last period Closing amount Opening amount
On Chinese accounting
107,272,369.77 96,998,429.76 1,319,496,334.84 1,234,930,863.46
standards
Items and amounts adjusted according International Accounting Standards
On international accounting
107,272,369.77 96,998,429.76 1,324,259,733.08 1,239,694,261.70
standards
2. Differences in net profits and assets in financial statements disclosed according to the overseas and
Chinese account standards
□ Applicable √ Inapplicable
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
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China Fangda Group Co., Ltd. 2015 Annual Report
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.
8. Financial highlights by quarters
In RMB
Q1 Q2 Q3 Q4
Turnover 478,296,193.16 671,819,330.37 692,471,803.42 707,880,167.83
Net profit attributable to the
15,504,344.70 35,813,304.17 20,237,940.89 35,716,780.01
shareholders of the listed company
Net profit attributable to the
shareholders of the listed company
14,487,216.74 20,999,835.66 543,165.95 -6,959,924.71
and after deducting of
non-recurring gain/loss
Cash flow generated by business
-235,696,168.76 -39,015,902.43 -89,274,391.77 3,871,348.92
operations, net
Where there is difference between the above-mentioned financial data or sum and related financial data in quarter
report and interim report disclosed by the Company
□ Yes √ No
9. Accidental gain/loss item and amount
√ Applicable □ Inapplicable
In RMB
Items 2015 2014 2013 Notes
Non-current asset disposal gain/loss
(including the write-off part for which assets -522,948.72 -24,398.43 -462,554.08
impairment provision is made)
Subsidies accounted into the current income
account (except the government subsidy
closely related to the enterprise’s business 2,246,386.84 2,340,175.75 1,815,855.07
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
the current income account
Gain from entrusted investment or assets
250,897.54 2,144,844.80 306,301.37
management
Gain/loss from change of fair value of 4,341,316.92 -2,852,885.00
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China Fangda Group Co., Ltd. 2015 Annual Report
transactional financial asset and liabilities,
and investment gains from disposal of
transactional financial assets and liabilities
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 85,793,780.49 34,897,632.10 16,647,859.74
in follow-up measurement
Other non-business income and expenditures
7,624,429.39 -3,671,724.03 1,929,934.59
other than the above
Less: Influenced amount of income tax 20,963,417.56 9,526,862.57 5,177,842.87
Influenced amount of minority
568,368.77 -973,756.92 -74,498.31
shareholders’ equity (after-tax)
Total 78,202,076.13 27,929,852.66 17,283,472.22 --
No circumstance that should be defined as recurrent profit and loss according to Explanation Announcement of
Information Disclosure No. 1 - Non-recurring gain/loss occurs in the report period.
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China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 3 Business Introduction
1. Major businesses of the Company during the report period
Headquartered in Nanshan District, Shenzhen, the Company is the first private company listed in China. The
shares were firstly listed in Shenzhen Stock Exchange on November 29, 2015. Currently, three major business
subsidiaries of the Company are national high-tech enterprises with modern production bases in Shenzhen,
Beijing, Shanghai, Chengdu, Shengyang, Nanchang, Dongguan and Foshan. The Company was engaged in the
following businesses in the report period.
1. Curtain wall system and material industry: The Company is a pioneer and first listed company in this
industry. Over the past more than 20 years, the Company has undertaken hundreds of large projects and received
the highest award in the industry China Construction Luban Award and Zhan Tianyou Civil Engineering Award
for many times. The Company has also received nearly 100 provincial and above awards. The Company ranks
among the top 5 players in the globe in terms of the market share of high-end energy-saving curtain walls. The
Company has a strong technology lead in the industry with hundreds of patents. The Company also took part in
the preparation of more than 10 national or industry standards including the Public Construction Energy Saving
Design Standard, making 9 records among Chinese enterprises.
2. Rail transport equipment industry: The Company has developed rail transport screen door systems with
independent intellectual property rights. The Company also prepared the first Rail Transport Station Screen Door
Standard. Currently, the screen door systems have been used in 23 cities, ranking No.1 in China in terms of the
market share. The Company is also the largest supplier of screen doors in the world.
3. New Energy industry: The solar PV power generation industry is largely supported by the government.
The Company is one of the first enterprises that obtain the independent intellectual property rights in solar PV
system design, production and integration. In 2002, the Company built the first integrated solar PV building
project. Currently, the Company has signed solar PV power plant project agreement with an installation capacity
of 1.1GW.
4. Real estate industry: the Company has invested RMB2.5 billion to build the Fangda Town. As a high-end
industry R&D headquarters, the building integrates office, commercial and recreation functions and will become a
landmark in Shenzhen. The project has received the pre-sales certification in the report period.
Read Management Discussion and Analysis for details about the Company’s businesses.
2. Major assets change
1. Major assets change
Main assets Major change
Equity assets None
Fixed assets None
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China Fangda Group Co., Ltd. 2015 Annual Report
Intangible assets None
Construction in process Increased by RMB14.7927, due to the increased investment in PV power plants
Investment real estate Increased by 48.19%, due to increase in leased houses and change in the fair value
2. Major foreign assets
□ Applicable √ Inapplicable
3 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 low-carbon curtain walls, developing a series of domestic
and global leading solar and energy-saving curtain wall products. The Company owns 385 curtain wall and
material patents (including 25 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 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 solutions
The Company has integrated the design, production, management and engineering of curtain wall systems to
enjoy technological, cost, quality and service advantages.
(2) Rail transport equipment business
1. National development strategy
In 2015, the rail transport equipment is listed in the Made in China 2025 plan as a key industry. The 13th
Five-Year Plan specifies that the rail construction will be reinforced to promote the advanced railway equipment
manufacturing industry. The One-Belt-One-Road strategy has become a national development strategy. The
National Reform and Development Committee indicated that 50 cities will have rail transport in 2020 with a total
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China Fangda Group Co., Ltd. 2015 Annual Report
mileage of 6,000 km. The industry enjoys a rosy outlook under the background.
2. 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 223 metro screen
door patents, including 44 invention patents. The Company also has eight computer software copyrights.
3. Brand equity
So far, the Company has undertaken railway screen door projects in most domestic cities, Hong Kong, Taipei
and Singapore. 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.
(3) New energy industry
The new energy business mainly comprises solar power PV application, PV construction and LED 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 power PV power generation is closely related to the Company’s existing businesses. Most
distributed solar power PV systems are 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.
(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. 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.
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China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 4 Management Discussion and Analysis
1. Summary
In 2015, the recovery of the global economy remained weak and the Chinese economy faced a heavy
downward pressure. In front of the adverse economic environment, the Company has been able to overcome
difficulties and fulfill the annual operation target under the leadership of the Board of Directors and management
and joint efforts of all employees. In the report period, the Company secured orders of RMB3.284 billion, up 17%
year on year, recorded an operation turnover of RMB2.55 billion, up 31.58% year one year. The net profit
attributed to the owner of the parent reached RMB107 million, up 10.59% year one year. By the end of the report
period, the Company had secured new orders worth RMB2.944 billion, which 115% of the operating revenue in
2015, paving the way for the Company to complete the whole year’s sales target. The Fangda Town renovation
project is proceeding as scheduled. The pre-sales certificate has been received in the report period.
1. Continuing to make headway in curtain wall system and material market exploration
As the urbanization accelerates and more and more people realize the importance of energy saving, the
market demand for high-end energy-saving curtain walls is on the rise. Over the past more than 20 years, the
Company has been committed to the philosophy of building a leading company, products and services.
Underpinned by our advantages in technology, hardware, brand and services, we have taken different market
strategies to explore the high-end energy-saving curtain wall market. Currently, the Company’s curtain wall and
material products have emerged as a leading brand in the domestic market. In 2015, the Company won a series of
large-sized energy-saving curtain wall and aluminum material projects including the Shenzhen Hanjing Finance
Center, Shenzhen Kexing Hi-tech Park D Zone, Shanghai Hongqiao Commercial Area Office Building, Shanghai
Wuzhong Road shopping mall, Jinan Shangri-La Hotel, Chengdu Fuli Plaza and Lanzhou International Trade
Center. Projects including the Shenzhen Alibab/Ali Cloud Building, Chengdu Wanda Ruihua Hotel, Kunming
Wanda, Nanchang Wanda Mao, Shanghai Bund SOHO, Shanghai Vanke Jade Bank, Shanghai China Resource
Mix City are proceeding as scheduled. The business recorded a sales income of RMB2.1 billion in 2015, up 27.81%
year on year. The remaining orders at the end of the year reached RMB2.28 billion yuan, accounting for 108% of
the business’s sales income in 2015. Given our advantages, the business will continue growing rapidly over the
next few years.
The Company has optimized its organizational structure, management mode and management functions to
control safety risks, regulate the project management system, reinforce the payment collection system. These
measures will help build a solid foundation for the development and growth of the business.
2. A leader in the rail transport equipment market
In 2015, the rail transport equipment is listed in the Made in China 2025 Plan as a key field to development.
The 13th Five-Year Plan also highlights the construction of rail transport and development of the rail transport
equipment. In recent years, the Chinese economy has continued growing. Many domestic cities have accelerated
the construction of rail transport. By the end of 2015, 26 cities have put rail transport into use with a total mileage
of 3,612 km. The National Reform and Development Committee indicated that 50 cities will have rail transport in
2020 with a total mileage of 6,000 km. Therefore, the industry will enter its gold age of rapid growth. The
Company will benefit from this trend as a market leader.
With a decade’s innovation and development, the Company’s screen doors have been used in more than 20
domestic cities and other cities including Singapore, Hong Kong and Taiwan. In 2015, the market share, brand
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China Fangda Group Co., Ltd. 2015 Annual Report
equity, intellectual property rights, industry standard and engineering services of our products have won wide
applause from customers. We won screen door projects in Lanzhou, Xiamen, Wuhan, Hefei, Nanning, Nanchang
and Kunming, ranking No.1 in China in terms of the bidding amount. In the report period, Dalian subway line
No.1, Nanchang subway line No.1. Dongguan subway line No.2 and Wuhan subway line No.3 equipped with our
screen doors have been put into operation. In the report period, the business recorded a sales income of
RMB255,753,000, up 59.42% year on year. By the end of 2015, reserved orders reached RMB660 million,
accounting for 258% of the sales income in 2015. In the future, the Company will take advantage of the One Belt
One road strategy to explore overseas markets in Southeast Asia and West Asia. The Company is likely to make a
giant leap in the overseas screen door market.
In 2015, the maintenance market of the screen door business has largely improved. In the future, the
Company will expand the business scope to fields related to screen doors including advertisement and intelligent
systems underpinned by the solid quality, technology and service reputation.
3. Moving forward steadily in the new energy industry
Since the Company established the new energy company in July 2014, the Company has entered into
framework agreement for constructing distributed solar PV power plants in Jiangxi Nanchang, Pingxiang, Xinyu
and Longnan with a total installation capacity of 1.1 GWp. In 2015, the solar PV business was developed as
planned. The 2MWp distributed solar PV power plant in Dongguan Songshanhu was accepted by Guangdong and
Gongguan Power Supply Administration on October 1, 2015. The Company also signed the electricity purchase
and sales contract with the Guangdong Power Supply Company of China Southern Power Grid. By December 31,
2015, the project has generated 461,000 kilowatt-hours, reaching the estimated generation efficiency. The
Company raised RMB470 million through private share issuance to invest in three PV power plant project with a
total capacity of 39.3MWp. The issuance has been approved by CSRC. The three projects will be put into
operation in 2016. The business will bring stable income and profit for the Company in the future and become a
new profit source.
4. Fangda Town renovation project
In 2015, the Fangda Town renovation project has been proceeding as scheduled. The ceiling of the building
No.2 was finished. The pre-sales certification for Phase 1 is received. The phase 1 was put into sales in January
2016 and was largely welcomed in the market. The phase 1 is expected to be finished by the end of 2016 and put
into use between 2016 and 2017. The project will substantially increase the Company’s assets, bring stable cash
flow and lease income for the Company, supporting the Company’s future demand for capital.
5. Awards
In the report period, the Company received a series of awards and titles, including the Shenzhen Top 100
Enterprises, National Outstanding Foreign Investment Enterprise, Guangdong Innovation Leader, Shenzhen
Industry Award. Mr. Xiong Jianming was elected as one of the Top 35 Chinese Business Leaders in 35 Years. Mr.
Lin Kebin is elected as Shenzhen New-Generation Innovation Leader. Mr. Zheng Zheng, head of the Information
Management Department was elected as the Guangdong Outstanding Chief Information Officer. The Company
applied for 24 new patents, including 7 new invention patents.
A series of curtain wall projects undertaken by Jianke Group won the 2014-2015 China Construction Luban
Award, 2015 Guangdong High Quality Project Award. China Construction Curtain Wall Top 100 Enterprise,
Shenzhen Decoration Jinpeng Award, Chengdu Jinrong Cup Gold Award, and received titles including Reliable
Partner, Best Strategic Partner, High-Quality Supplier and Outstanding Project Team from customers.
Fangda Automatic received the Second Award of the Shenzhen Scientific Achievement, Fucai Cup QCC
Achievement Excellent Award, and received titles including Outstanding Management Team, Technological
Expert from the Tianjin Subway; a leading group by Nanchang rail transport group.
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China Fangda Group Co., Ltd. 2015 Annual Report
Jiangxi New Material received titles including Nanchang National High-Tech Industry Park Leading
Enterprise, and Leading Company in Standardization.
Fangda Town renovation project received the 2016 Highlighted Project Award and Annual High-Quality
Project Award
2. Main business analysis
1. Summary
For details see Management Discussion and Analysis – 1. Profile
2. Income and costs
(1) Turnover composition
In RMB
2015 2014
Proportion in Proportion in YOY change (% )
Amount Amount
operating costs (%) operating costs (%)
Total turnover 2,550,467,494.78 100% 1,938,324,435.51 100% 31.58%
Industry
Metal production 2,100,612,326.46 82.36% 1,643,589,644.97 84.79% 27.81%
Railroad industry 255,752,825.73 10.03% 160,427,755.09 8.28% 59.42%
New energy industry 136,270,215.79 5.34% 92,516,175.40 4.77% 47.29%
Others 57,832,126.80 2.27% 41,790,860.05 2.16% 38.38%
Product
Curtain wall system
2,100,612,326.46 82.36% 1,643,589,644.97 84.79% 27.81%
and materials
Subway screen door
255,752,825.73 10.03% 160,427,755.09 8.28% 59.42%
and service
LED products 136,014,530.20 5.33% 92,516,175.40 4.77% 47.02%
PV power generation 255,685.59 0.01%
Others 57,832,126.80 2.27% 41,790,860.05 2.16% 38.38%
District
Domestic 2,480,678,272.83 97.26% 1,898,111,499.44 97.93% 30.69%
Overseas 69,789,221.95 2.70% 40,212,936.07 2.07% 73.55%
(2) Industries, products or districts that take more than 10% of the Companys business turnover or profit
√ Applicable □ Inapplicable
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China Fangda Group Co., Ltd. 2015 Annual Report
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 2,100,612,326.46 1,769,172,547.22 15.78% 27.81% 28.30% -0.33%
Railroad industry 255,752,825.73 202,151,998.82 20.96% 59.42% 73.05% -6.23%
Product
Curtain wall
system and 2,100,612,326.46 1,769,172,547.22 15.78% 27.81% 28.30% -0.33%
materials
Subway screen
255,752,825.73 202,151,998.82 20.96% 59.42% 73.05% -6.23%
door and service
District
Domestic 2,480,678,272.83 2,127,455,729.07 14.24% 30.69% 35.99% -3.34%
Main business statistics adjusted in the recent one year with the statistics criteria adjusted in the report period
□ Applicable √ Inapplicable
(3) The physical sales revenue is high the labor service revenue
√ Yes □ No
Industry Items Unit 2015 2014 YOY change (% )
Sales M2 2,935,850.86 2,479,915.61 18.39%
Curtain wall system
Output M2 2,972,936.22 2,593,192.46 14.64%
and materials
Inventory M2 257,208.5 220,123.14 16.85%
Explanation for a year-on-year change of over 30%
□ Applicable √ Inapplicable
(4) Performance of signed major sales contracts in the report period
□ Applicable √ Inapplicable
(5) Operation cost composition
Product
In RMB
2015 2014
Product Items Proportion in Proportion in YOY change (% )
Amount Amount
operating costs operating costs
17
China Fangda Group Co., Ltd. 2015 Annual Report
(%) (%)
Curtain wall
system and Raw materials 1,181,842,856.96 66.80% 929,436,079.36 67.40% 27.16%
materials
(6) Change to the consolidation scope in the report period
√ Yes □ No
In the period, the Company expanded its direct or indirect control to another eight subsidiaries including Jiangxi
Fangda Property Development Co., Ltd., Shenzhen Fangda Property Management Co., Ltd., Shenzhen Qianhai
Kechuangyuan Software Co., Ltd., Ganzhou Longneng New Energy Co., Ltd., Pingxiang Fangda Luxin New
Energy Co., Ltd., Pingxiang Xiangdong Fangda New Energy Co., Ltd., Nanchang Xinjian Fangda New Energy
Co., Ltd. and Dongguan Fangda New Energy Co., Ltd.
In the period, the Company finished the liquidation of directly control subsidiary Hong Kong Junjia, which is
removed from the consolidated financial statements.
(7) Major changes or adjustment of business, products or services in the report period
□ Applicable √ Inapplicable
(8) Major sales customers and suppliers
Main customers
Total sales amount to top 5 customers (RMB) 552,235,358.77
Proportion of sales to top 5 customers in the annual sales 21.33%
Information of the Company's top 5 customers
No. Customer Sales (RMB) Percentage in the annual sales
1 No.1 142,066,212.50 5.49%
2 No.2 129,929,168.20 5.02%
3 No.3 96,872,963.97 3.74%
4 No.4 94,429,356.09 3.65%
5 No.5 88,937,658.01 3.43%
Total -- 552,235,358.77 21.33%
Other information about major customers
□ Applicable √ Inapplicable
Main suppliers
Purchase amount of top 5 suppliers (RMB) 482,934,163.51
Proportion of purchase amount of top 5 suppliers in the
26.90%
total annual purchase amount
Information of the Company’s top 5 suppliers
18
China Fangda Group Co., Ltd. 2015 Annual Report
No. Supplier Purchase amount (RMB) Percentage in the annual purchase amount
1 No.1 192,123,453.34 10.70%
2 No.2 113,958,182.88 6.35%
3 No.3 81,538,198.15 4.54%
4 No.4 48,318,649.24 2.69%
5 No.5 46,995,679.91 2.62%
Total -- 482,934,163.51 26.90%
Other information about major suppliers
□ Applicable √ Inapplicable
3. Expenses
In RMB
2015 2014 YOY change (% ) Notes
Mainly due to increase in
Sales expense 75,264,951.18 44,684,306.70 68.44%
advertisement and promotion expenses
Administrative expense 167,405,776.25 152,584,713.60 9.71%
Financial expenses 50,672,490.05 29,165,058.80 73.74% Mainly due to increase in average loan
4. R&D investment
√ Applicable □ Inapplicable
During the report period, the Group focused on low-carbon, energy saving, environmental protection and
sustainable development to develop new products, new processes and technologies. The Group has finished the
R&D of energy-saving curtain walls, solar PV curtain walls, aluminum compound plates, single-layer aluminum
sheets, aluminum honeycomb sheets, subway screen door systems, PV power plants with intellectual property
rights. The solid expertise elevates the Group’s core competitiveness and underpins the long-term solid
development of the Group.
R&D investment
2015 2014 Change
R&D staff number 351 344 2.03%
R&D staff percentage 15.08% 11.39% 3.69%
R&D investment amount
105,200,255.72 86,772,964.18 21.24%
(RMB)
Investment percentage in
4.12% 4.48% -0.36%
operation turnover
Capitalization of R&D
0.00 0.00
investment amount (RMB)
19
China Fangda Group Co., Ltd. 2015 Annual Report
Percentage of capitalization of
R&D investment in the R&D 0.00% 0.00%
investment
Reason for the increase in the percentage of R&D investment in the business turnover
□ Applicable √ Inapplicable
Explanation of the increase in the capitalization of R&D investment
□ Applicable √ Inapplicable
5. Cash flow
In RMB
Items 2015 2014 YOY change (% )
Sub-total of cash inflow from
2,219,602,450.52 1,684,047,696.92 31.80%
business operations
Sub-total of cash outflow from
2,579,717,564.56 2,241,941,626.36 15.07%
business operations
Cash flow generated by
-360,115,114.04 -557,893,929.44
business operations, net
Sub-total of cash inflow
397,636,935.30 302,123,140.16 31.61%
generated from investment
Subtotal of cash outflows 213,169,919.71 588,172,728.21 -63.76%
Cash flow generated by
184,467,015.59 -286,049,588.05
investment activities, net
Subtotal of cash inflow from
1,764,927,828.86 1,303,817,100.01 35.37%
financing activities
Subtotal of cash outflow from
1,444,458,573.58 642,732,507.84 124.74%
financing activities
Net cash flow generated by
320,469,255.28 661,084,592.17 -51.52%
financing activities
Net increase in cash and cash
145,101,011.59 -182,599,023.19 -179.46%
equivalents
Explanation of major changes in related data from the same period last year
√ Applicable □ Inapplicable
Increase in net cash flows from investment activities is mainly caused by the large cash flow-out for purchase of
financial products in the same period last year;
The increase in the net cash flow from financing activities is mainly caused by the increase in the capital flow-in
of bank loans in the same period last year.
Explanation of major difference between the cash flow generated by operating activities and the net profit in the
year
√ Applicable □ Inapplicable
20
China Fangda Group Co., Ltd. 2015 Annual Report
The net profit this year reached RMB6,812,151,400 with a new cash flow of RMB-360,115,100 from operation
activities, mainly the capital flow-out to the Fangda Town renovation project, which has not create cash flow-in
yet.
3. Non-core business analysis
√ Applicable □ Inapplicable
In RMB
Amount Profit percentage Reason Whether continuous
From transfer of
Investment income 280,949.87 0.27% No
transactional financial assets
Gain/loss caused by
Adjustment of fair value of
changes in fair 89,746,065.58 86.77% No
investment real estate
value
Bad debt provision,
inventory depreciation
Assets impairment 50,019,679.10 48.36% No
provision and goodwill
impairment provision
Share transfer payment that
Non-operating does not need to paid
29,668,110.25 28.69% No
revenue because the payment
condition is not met
Non-business
18,233,740.07 17.63% Estimated lawsuit indemnity No
expenses
4. Assets and liabilities
1. Major changes in assets composition
In RMB
End of 2015 End of 2014
Change
Proportion in Proportion in Notes
Amount Amount (% )
total assets total assets
400,953,337.3
Monetary capital 8.98% 212,430,798.87 5.80% 3.18%
2
Account 1,405,718,134. 1,105,242,251.
31.49% 30.18% 1.31%
receivable 89 46
Up 37.07 year on year, due to increase
1,346,591,303.
Inventory 30.16% 982,441,187.05 26.82% 3.34% in the investment in Fangda Town
53
project
Investment real 335,328,805.7 7.51% 226,279,523.39 6.18% 1.33% Increased by 48.19%, due to increase
21
China Fangda Group Co., Ltd. 2015 Annual Report
estate 4 in leased houses and change in the fair
value
Long-term share
10,489,680.93 0.23% 11,048,660.43 0.30% -0.07%
equity investment
462,648,998.5
Fixed assets 10.36% 489,714,684.63 13.37% -3.01%
1
Increased by RMB14.7927, due to the
Construction in
15,134,390.90 0.34% 341,749.17 0.01% 0.33% increased investment in PV power
process
plants
1,147,957,775. 1,100,000,000.
Short-term loans 25.72% 30.03% -4.31%
82 00
Increased by RMB300 million, due to
300,395,582.0
Long-term loans 6.73% 0.00% 6.73% long-term borrowing from banks for
6
Fangda Town project
2. Assets and liabilities measured at fair value
√ Applicable □ Inapplicable
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
Financial assets
1. Financial
assets measured
at fair value
with variations
accounted into 14,546,206.5
13,410,790.00 3,952,285.09 2,416,792.96
current income 8
account
(excluding
derivative
financial assets)
14,546,206.5
Subtotal 13,410,790.00 3,952,285.09 2,416,792.96
8
Investment real 304,615,212.
198,513,586.15 85,793,780.49 91,831.63 20,307,845.89
estate 53
Total 211,924,376.15 89,746,065.58 91,831.63 20,307,845.89 2,416,792.96 319,161,419.
22
China Fangda Group Co., Ltd. 2015 Annual Report
11
Financial
0.00 0.00 0.00 0.00 0.00 0.00 0.00
liabilities
Major changes in the assets measurement property of the Company in the report period
□ Yes √ No
5. Investment
1. General situation
□ Applicable √ Inapplicable
2. Major equity investment in the report period
□ Applicable √ Inapplicable
3. Major non-equity investment in the report period
□ Applicable √ Inapplicable
4. Financial assets investment
(1) Securities investment
√ Applicable □ Inapplicable
In RMB
Accumu
lative
Gain/los changes
s caused in fair Amount Amount
Initial Account Opening Closing
Securiti Abbrevi by value purchas sold in Gain/los Account Capital
Code investm ing book book
es ation changes accounti ed in the the s ing item source
ent cost method value value
in fair ng into period period
value the
income
account
Domesti Sino Oil Measure Transact
c and Gas 16,263, ment at 13,410, 3,952,2 2,416,7 4,341,3 14,546, ional Self-ow
00702 0.00 0.00
overseas Holding 675.00 fair 790.00 85.09 92.96 16.92 206.58 financia ned fund
shares s Ltd value l assets
16,263, 13,410, 3,952,2 2,416,7 4,341,3 14,546,
Total -- 0.00 0.00 -- --
675.00 790.00 85.09 92.96 16.92 206.58
23
China Fangda Group Co., Ltd. 2015 Annual Report
Disclosure date of approval
by the Board of Directors 11.03.14
of securities investment
Disclosure date of approval
by the Board of Directors None
of securities investment
(2) Derivative investment
√ Applicable □ Inapplicable
In RMB10,000
Proporti
on of
closing
investm Actua
Derivati Amount Impairm ent l
Initial Amount Closing
ve Related purchas ent amount gain/l
Relation Initial Start investm sold in investm
investm transacti Type End date ed in provisio in the oss in
ship amount date ent this ent
ent on this n (if closing the
amount period amount
operator period any) net report
assets in period
the
report
period
Shangha
Shanghai
i Futures -293.3
None No aluminu 8,512.72 05.01.15 28.09.15 0 8,512.72 8,512.72 0 0 0.00%
Exchang 5
m
e
-293.3
Total 8,512.72 -- -- 0 8,512.72 8,512.72 0 0 0.00%
5
Capital source Self-owned fund
Lawsuit involved None
Disclosure date of derivative
investment approval by the Board of
Directors (if any)
Disclosure date of derivative
investment approval by the
Shareholders’ Meeting (if any)
Risk analysis and control measures To prevent the risk of fluctuation of raw material prices, the Company adopted the
for the derivative holding in the report aluminum futures exchanged at the domestic futures exchange to provide hedging for
period (including without limitation aluminum as a raw material for the Company. The Company has set up and implemented the
24
China Fangda Group Co., Ltd. 2015 Annual Report
market, liquidity, credit, operation and Provincial Regulations on China Fangda Group Domestic Futures Hedging to prevent risks.
legal risks)
Changes in the market price or fair
value of the derivative in the report
period, the analysis of the derivative’s The fair value of the derivative should be calculated with the open quotation of the futures
fair value should disclose the method market and should be reviewed regularly to ensure effective hedging.
used and related assumptions and
parameters.
Material changes in the accounting
policies and rules related to the
No
derivative in the report period
compared to last period
Opinions of independent directors on
the Company’s derivative investment None
and risk controlling
5. Use of raised capital
□ Applicable √ Inapplicable
The Company used no raised capital in the report period.
6. Major assets and equity sales
1. Major assets sales
□ Applicable √ Inapplicable
The Company sold no assets in the report period.
2. Major equity sales
□ Applicable √ Inapplicable
7. Analysis of major joint stock companies
√ Applicable □ Inapplicable
Major subsidiaries and joint stock companies affecting more than 10% of the Company’s net profit
In RMB
Main Registered Operation
Company Type Total assets Net assets Turnover Net profit
business capital profit
Fangda Curtain wall 500,000,000. 2,936,047,11 772,966,316. 1,953,103,18 95,850,803.1 67,645,946.1
Subsidiary
Jianke system 00 6.42 65 8.89 2 8
Fangda Subsidiary Subway 105,000,000. 446,214,437. 224,286,077. 258,278,535. 30,644,833.5 26,511,078.2
25
China Fangda Group Co., Ltd. 2015 Annual Report
Automatic screen door 00 49 17 47 0 1
and service
Acquisition and disposal of subsidiaries in the report period
□ Applicable √ Inapplicable
Acquisition and disposal of subsidiaries in Impacts on business operation and
Company
the report period performance
Hong Kong Junjia Liquidation None
Major joint-stock companies
8. Structural entities controlled by the Company
□ Applicable √ Inapplicable
9. Future Prospect
(1) Competition map and development trend
1. Curtain wall and material system industry
As China continues urbanizing, the demand for construction curtain walls will grow rapidly, fueling the
development of the curtain wall industry. Over recent years, a series of industry policies will be issued to push
forward the industry, providing a gold opportunity for the development of energy-saving curtain wall and solar
power generation curtain wall business.
2. Rail transport equipment business
In 2015, the rail transport equipment is listed in the Made in China 2025 plan as a key industry. The 13th
Five-Year Plan specifies that the rail construction will be reinforced to promote the advanced railway equipment
manufacturing industry. The National Reform and Development Committee indicated that 50 cities will have rail
transport in 2020 with a total mileage of 6,000 km. By the end of 2015, 26 cities have put rail transport into use
with a total mileage of 3,612 km. Therefore, the industry will turn on to a fast track. City rail transport projects are
mainly subway projects, for which screen doors are must-have. The screen door market will expand rapidly in the
future.
3. New energy industry
The solar PV power generation industry is supported by the government. By the end of 2015, the total
installation capacity of PV power generation in China reached 43,180MW, making China the largest country in
term of the PV power generation capacity. In the 13th Five-Year Plan period, the capacity will increase by
15-20MW. Over the past few years, the government has issued a series of policies to support the development of
the industry, from distributed PV power generation plant pilot zone to subsidies for construction of distributed PV
power plants and streamlining related grid connection policies. Although centralized power plants remain the
mainstay in terms of the connection power capacity in China currently, it is estimated that distributed power plants
will grow faster than the average speed of the industry and become the main mode in the future.
4. Real estate
As the land resource in cities becomes increase scarce, city renovation will become a common task for all
major cities. The limited land resource has also become a bottleneck for the development of Shenzhen. City
26
China Fangda Group Co., Ltd. 2015 Annual Report
renovation provides a low-cost solution for this problem and is largely supported by the government.
(2) Company development strategy and business plan
The year 2016 is a beginning year of the 13th Five-Year Plan period with a lot of uncertainties in the
domestic and overseas economy and financial environments. The Company will take advantage of the deepening
reform and opening up process to improve management efficiency, continue innovation and fulfill the annual
business target, making a solid foundation for the long-term development.
In 2016, the curtain wall and material industry will continue exploring the South China region with Shenzhen
as the center and also pay attention to high-quality projects in Shanghai, Beijing, Chengdu and Chongqing.
Adhering to the high-end market position, the Company will explore the overseas market. As the market leader in
the rail transport equipment industry, the Company will stick to the One Road One Belt strategy and seek to
explore overseas markets in Southeast Asia and West Asia. The Company will seek to finish the private share
issuance to support the development of the solar PV power generation business. The Company will guarantee the
quality and schedule of the Fangda Town renovation project to ensure delivery as scheduled.
(3) Capital demand and source for projects in progress
To realize the business target in 2016, the Company will develop suitable financial and capital plans,
accelerate the collection of accounts receivable, sales payment from sales of Fangda Town, expand financing
channels, and use share issuance, bank loans and other financing products to meet the demand for capital.
(4) Risks and solutions
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 five 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
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, strengthen staff training to improve working efficiency.
4. Solar PV power plant risks and measures
The industry is closely related to policies of the local government. Changes in policies will have large
impacts on the industry. The Company will continue paying attentions to the development of the industry. The
Company will conduct adequate verification on project feasibility, control costs, quality and schedules strictly,
27
China Fangda Group Co., Ltd. 2015 Annual Report
and improve its development, construction and maintenance capabilities.
X. Acceptance of investigations, communications, or interviews
1. Reception of investigations, communications, or interviews in the reporting period
√ Applicable □ Inapplicable
Time/date Way Visitor Disclosure of information
Investor Relationship Record Form on
21.01.15 Onsite investigation Institution
www.cninfo.com.cn
Investor Relationship Record Form on
28.04.15 Onsite investigation Institution
www.cninfo.com.cn
Investor Relationship Record Form on
26.05.15 Onsite investigation Institution
www.cninfo.com.cn
Investor Relationship Record Form on
24.07.15 Onsite investigation Institution
www.cninfo.com.cn
Investor Relationship Record Form on
26.11.15 Onsite investigation Institution
www.cninfo.com.cn
Time 5
Number of institutes 7
Number of individuals 8
Number of other visitors 0
Disclosure of any non-public information No
28
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 5 Significant Events
1. Profit distribution and reserve capitalization plan
Establishment, implementation or adjustment of profit distribution policies especially the cash dividend policy
during the report period
√ Applicable □ Inapplicable
During the report period, the Company implemented the profit distribution plan for 2014. Approved at the
Shareholders' Meeting 2014 held on 17.04.15, the Company's profit distribution plan for 2014 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 31.12.14. The plan was implemented on 05.06.15 (see the 2014 Share Equity Distribution
Implementation Announce 2015-18).
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)
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 31.12.14. No dividend share or capitalization
share is issued in the year.
2015: A cash dividend of RMB1 (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 75,690,990.50, on 31.12.15. No dividend share or capitalization
share is issued in the year.
Distribution of cash dividend over the recent three years (including this period)
In RMB
Year Cash dividend Net profit Proportion in the net Cash dividend paid Proportion of cash
29
China Fangda Group Co., Ltd. 2015 Annual Report
(including tax) attributable to project attributable in other manners dividend paid in
shareholders in the to shareholders in other manners
consolidated the consolidated
financial statements financial statements
2015 75,690,990.50 107,272,369.77 70.56% 0.00 0.00%
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%
Cash dividend proposed despite the Company records profits in the report period and a positive undistributed
profit
□ Applicable √ Inapplicable
2. 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,
1
tax-included)
Shares capitalized for every 10 shares 0
A total number of shares as the distribution basis 756,909,905
Total cash dividend (yuan, including tax) 75,690,990.50
Distributable profit (yuan) 402,148,728.12
Proportion of cash dividend in the distributable
100.00%
profit
Cash dividend
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 RMB1 (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 31.12.15. No dividend share or capitalization share is issued
in the year. The plan needs to be reviewed and approved at the General Shareholders' Meeting 2015.
3. Performance of promises
1. Promises fulfilled and not fulfilled by the Company, shareholders, actual controller, acquirer, directors,
supervisors, senior management or other associates in the report period
□ Applicable √ Inapplicable
There are no promises fulfilled and not fulfilled by the Company, shareholders, actual controller, acquirer,
directors, supervisors, senior management or other associates in the report period.
30
China Fangda Group Co., Ltd. 2015 Annual Report
2. Explanation and reason of profit forecasts on assets or projects that remain in the report period
□ Applicable √ Inapplicable
4. Non-operating capital use by the controlling shareholder or related parties in the reporting
term
□ Applicable √ Inapplicable
The controlling shareholder and its affiliates occupied no capital for non-operating purpose of the Company
during the report period.
5. Statement of the Board of Directors, Supervisory Committee and Independent Directors (if
applicable) on the “non-standard auditors report” issued by the CPA on the current report
period
□ Applicable √ Inapplicable
6. Statement of changes to accounting policies, estimates and audit methods compared with
the financial report of the previous year
□ Applicable √ Inapplicable
No change in accounting policies, assumptions and auditing methods in the report period.
7. Statement of retrospective restatement of major accounting errors in the report period
□ Applicable √ Inapplicable
No retrospective restatement of major accounting errors in the report period
8. Statement of change in the financial statement consolidation scope compared with the
previous financial report
√ Applicable □ Inapplicable
In the period, the Company expanded its direct or indirect control to another eight subsidiaryies including Jiangxi
Fangda Property Development Co., Ltd., Shenzhen Fangda Property Management Co., Ltd., Shenzhen Qianhai
Kechuangyuan Software Co., Ltd., Ganzhou Longneng New Energy Co., Ltd., Pingxiang Fangda Luxin New
Energy Co., Ltd., Pingxiang Xiangdong Fangda New Energy Co., Ltd., Nanchang Xinjian Fangda New Energy
Co., Ltd. and Dongguan Fangda New Energy Co., Ltd.
In the period, the Company finished the liquidation of directly control subsidiary Hong Kong Junjia, which is
removed from the consolidated financial statements.
9. Engaging and dismissing of CPA
CPA engaged currently
31
China Fangda Group Co., Ltd. 2015 Annual Report
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
4
accountants
Name of certified accountants of the domestic public
Xie Peiren, Hu Gaosheng
accountants
Overseas public accountants name (if any) 0
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)
Whether the CPA is replaced
□ Yes √ No
Engaging of internal control audit CPA, financial advisor and sponsor
√ Applicable □ Inapplicable
This year, the Company engaged Grand Thornton China (limited liability partnership) as the financial
statement and internal control auditing CPA with a fee of RMB1.3 million.
This year, the Company engaged China Merchants Securities as the sponsor with a sponsoring fee of
RMB500,000 for the private share issuance issue.
10. Trade suspension and termination after the disclose of the annual report
□ Applicable √ Inapplicable
11. Bankruptcy and capital reorganizing
□ Applicable √ Inapplicable
The Company has no bankruptcy or reorganization events in the report period.
12. Significant lawsuit and arbitration
□ Applicable √ Inapplicable
The Company has no significant lawsuit or arbitration affair in the report period.
13. Punishment and rectification
□ Applicable √ Inapplicable
The Company received no penalty and made no correction in the report period.
32
China Fangda Group Co., Ltd. 2015 Annual Report
14. Credibility of the Company, controlling shareholder and actual controller
□ Applicable √ Inapplicable
15. Share incentive schemes, staff shareholding program or other incentive plans
□ Applicable √ Inapplicable
There are no share incentive schemes, staff shareholding program or other incentive plans in the report period
16. Material related transactions
1. Related transactions related to routine operation
□ Applicable √ Inapplicable
The Company made no related transaction related to daily operating in the report period.
2. Related transactions related to assets or equity transactions
□ Applicable √ Inapplicable
The Company made no related transaction of assets or equity requisition and sales in the report period.
3. Related transactions related to joint external investment
□ Applicable √ Inapplicable
The Company made no related transaction of joint external investment in the report period.
4. Related credits and debts
□ Applicable √ Inapplicable
The Company had no related debt in the report period.
(5) Other major related transactions
□ Applicable √ Inapplicable
The Company has no other significant related transaction in the report period.
17. Significant contracts and performance
1. Asset entrusting, leasing, contracting
(1) Asset entrusting
□ Applicable √ Inapplicable
The Company made no custody in the report period.
33
China Fangda Group Co., Ltd. 2015 Annual Report
(2) Contracting
□ Applicable √ Inapplicable
The Company made no contract in the report period
(3) Leasing
√ Applicable □ Inapplicable
Leasing
The annual lease income of investment real estate is RMB26,452,881.94.
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. Significant guarantee
√ Applicable □ Inapplicable
(1) Guarantee
In RMB10,000
External guarantees made by the Company and subsidiaries (exclude those made for subsidiaries)
Actual date of
Actual
Date of Guarantee occurring Type of Complete Related
Guarantee provided to amount of Term
disclosure amount (signing date of guarantee d or not party
guarantee
agreements)
Guarantee between the Company and its subsidiaries
Actual date of
Actual
Date of Guarantee occurring Type of Complete Related
Guarantee provided to amount of Term
disclosure amount (signing date of guarantee d or not party
guarantee
agreements)
since engage
of contract to
Fangda Jianke 27.03.15 71,000 19.06.15 39,789.43 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Jianke 27.03.15 26,000 10.10.15 13,487.71 Joint liability No No
2 years upon
due of debt
since engage
Fangda Jianke 27.03.15 40,000 17.09.15 23,280.08 Joint liability No No
of contract to
34
China Fangda Group Co., Ltd. 2015 Annual Report
2 years upon
due of debt
since engage
of contract to
Fangda Jianke 01.07.15 20,000 22.07.15 20,000 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Jianke 01.07.15 15,000 22.09.15 3,547.18 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Jianke 29.08.15 15,000 11.11.15 3,150 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Jianke 11.03.14 15,000 31.12.14 6,489.15 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Automatic 27.03.15 20,000 24.09.15 15,346.77 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Automatic 29.08.15 5,000 11.11.15 195.58 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda Automatic 27.03.15 5,000 21.10.15 1,463.59 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda New Material 27.03.15 6,200 27.09.15 2,781.95 Joint liability No No
2 years upon
due of debt
since engage
of contract to
Fangda New Material 27.03.15 8,000 27.05.15 7,456.25 Joint liability No No
2 years upon
due of debt
since engage
Fangda Property 23.03.13 130,000 03.02.15 30,039.56 Joint liability of contract to No No
2 years upon
35
China Fangda Group Co., Ltd. 2015 Annual Report
due of debt
since engage
Guangdong Fangda of contract to
27.03.15 2,000 29.01.15 2,000 Joint liability No No
SOZN 2 years upon
due of debt
Total of guarantee to
Total of guarantee to subsidiaries subsidiaries actually
256,000 152,293.65
approved in the report term (B1) occurred in the report term
(B2)
Total of balance of
Total of guarantee to subsidiaries guarantee actually provided
386,000 169,027.26
approved as of the report term (B3) to the subsidiaries as of end
of report term (B4)
Guarantee provided to subsidiaries
Actual date of
Actual
Date of Guarantee occurring Type of Complete Related
Guarantee provided to amount of Term
disclosure amount (signing date of guarantee d or not party
guarantee
agreements)
Total of guarantee provided by the Company (total of the above three)
Total of guarantee occurred
Total of guarantee approved in the
256,000 in the report term 152,293.65
report term (A1+B1+C1)
(A2+B2+C2)
Total of guarantee occurred
Total of guarantee approved as of
386,000 as of the end of report term 169,027.26
end of report term (A3+B3+C3)
(A4+B4+C4)
Percentage of the total guarantee occurred (A4+B4+C4) on net
128.10%
asset of the Company
Including:
(2) Incompliant external guarantee
□ Applicable √ Inapplicable
The Company made no incompliant external guarantee in the report period.
3. Entrusted cash capital management
(1) Wealth management
√ Applicable □ Inapplicable
In RMB10,000
Trustee Related Type of Amount Start date End date Earning Principal Impairme Estimate Actual Actual
36
China Fangda Group Co., Ltd. 2015 Annual Report
transactio product recognitio recovered nt return gain/loss recover
n n method actually provision in the of gain
(if any) report and
period loss in
the
report
period
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,000 31.12.14 07.01.15 yield 1,000 0.61 0.61
floating red
Branch 3.12%
earning
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,000 31.12.14 15.01.15 yield 1,000 1.34 1.34
floating red
Branch 3.12%
earning
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,000 31.12.14 10.02.15 yield 1,000 3.65 3.65
floating red
Branch 3.12%
earning
Non-prote
BOC, Annual
cted Recove
Shenzhen No 6,800 31.12.14 04.01.15 yield 6,800 2.33 2.33
floating red
Branch 3.12%
earning
Non-prote
BOC, Annual
cted Recove
Shenzhen No 4,000 08.01.15 22.01.15 yield 4,000 4.99 4.99
floating red
Branch 3.25%
earning
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,000 08.01.15 13.01.15 yield 1,000 0.43 0.43
floating red
Branch 3.12%
earning
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,500 16.02.15 16.03.15 yield 1,500 5.35 5.35
floating red
Branch 4.65%
earning
Non-prote
Annual
Bank of cted Recove
No 3,000 26.12.14 04.01.15 yield 3,000 2.07 2.07
China floating red
2.5%
earning
Principal
Bank of Annual Recove
No and 1,000 08.01.15 23.01.15 1,000 1.81 1.81
China yield red
interest
37
China Fangda Group Co., Ltd. 2015 Annual Report
protected 4.4%
Principal
Annual
Bank of and Recove
No 850 12.02.15 02.03.15 yield 850 1.97 1.97
China interest red
4.7%
protected
Annual
Bank of Earning-pr Recove
No 3,000 31.12.14 04.01.15 yield 3,000 0.92 0.92
China otected red
2.8%
Non-prote
BOC, Annual
cted Recove
Shenzhen No 6,000 31.12.14 04.01.15 yield 6,000 2.05 2.05
floating red
Branch 3.12%
earning
Principal
Annual
Bank of protected Recove
No 1,800 02.09.15 08.09.15 yield 1,800 0.77 0.77
China financial red
2.6%
product
Principal
Annual
Bank of protected Recove
No 3,000 29.09.15 08.10.15 yield 3,000 1.85 1.85
China financial red
2.5%
product
Principal
Annual
Bank of protected Recove
No 1,000 30.09.15 09.10.15 yield 1,000 0.47 0.47
China financial red
1.9%
product
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,000 17.06.15 23.06.15 yield 1,000 0.51 0.51
floating red
Branch 3.12%
earning
BOC, Annual
Treasury Recove
Shenzhen No 1,000 18.06.15 30.06.15 yield 1,000 0.74 0.74
bond red
Branch 2.246%
Non-prote
BOC, Annual
cted Recove
Shenzhen No 1,000 26.12.14 03.01.15 yield 1,000 0.34 0.34
floating red
Branch 3.12%
earning
Total 38,950 -- -- -- 38,950 32.2 32.2 --
Source of fund Self-owned fund
Principal and return due but not
0
covered
Lawsuit (if any) None
38
China Fangda Group Co., Ltd. 2015 Annual Report
Disclosure date of approval
11.03.14
announcement (if any)
Disclosure date of Shareholders'
Meeting approval announcement
(if any)
Whether there will be entrusted
No
wealth management plan
(2) Trusted loans
□ Applicable √ Inapplicable
The Company borrowed no trust loan in the report period.
4. Other significant contract
□ Applicable √ Inapplicable
The Company entered into no other significant contract in the report.
18. Other material events
□ Applicable √ Inapplicable
The Company had no other significant event to be explained in the report period.
19. Material events of subsidiaries
√ Applicable □ Inapplicable
Fangda SOZN fails to meet the performance target in 2015 with an operation loss of about RMB90.9991 million.
The Company has taken measures and signed the Share Repurchasing and Debt Payment Agreement, which will
be reviewed at the Shareholders’ Meeting in 2015. After the agreement comes into effect, the Company will no
longer hold shares of Fangda SOZN, which will no longer be incorporated in the consolidation scope. The share
repurchasing and debt payment issue will create an impact of RMB-1.44 million on the net profit in 2016. No
further impact will be created.
20. Social responsibilities
√ Applicable □ Inapplicable
In the reporting period , the Company has positively assumed social responsibilities by: paying taxes RMB128
million, up 22% year-on-year; donating RMB103,000 and investing RMB198,900 in environment protection,
create nearly 10,000 jobs; inputting RMB1.8823 million in employee knowledge and skill training. The company
has invested RMB105,200,000 to promote development of new draft, technology, product structure and patent
according to clean, safety and efficient production to make contribution for environmental protection.
39
China Fangda Group Co., Ltd. 2015 Annual Report
Are the listed company and subsidiaries involved in a heavy-pollution industry defined by the national
environment protection department?
□ Yes √ No □ N/A
21. Information about the Companys securities
Bonds publicly issued and listed in a securities exchange, immature or not fully paid by the approval date of the
annual report
No
40
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 6 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
Proportio Bonus Proportio
Amount new d from Others Subtotal Amount
n shares n
shares reserves
I. Shares with trade
779,292 0.10% 192,750 192,750 972,042 0.13%
restriction conditions
3. Other domestic shares 779,292 0.10% 192,750 192,750 972,042 0.13%
Including: Shares held by
779,292 0.10% 192,750 192,750 972,042 0.13%
domestic natural persons
II. Shares without trading 756,130,6 755,937,8
99.90% -192,750 -192,750 99.87%
limited conditions 13 63
420,179,4 419,986,6
1. Common shares in RMB 55.51% -192,750 -192,750 99.87%
25 75
2. Foreign shares in domestic 335,951,1 335,951,1
44.39% 0 0 44.39%
market 88 88
756,909,9 756,909,9
III. Total of capital shares 100.00% 0 0 100.00%
05 05
Reasons
√ Applicable □ Inapplicable
In July 2015, Mr. Xiong Jianming, the chairman and CEO, increased his shareholding in the secondary market.
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
41
China Fangda Group Co., Ltd. 2015 Annual Report
2. Changes in conditional shares
√ Applicable □ Inapplicable
In share
Conditional
Conditional
shares at Released this Increased this Reason of
Shareholder shares at end of Date of releasing
beginning of the period period condition
the period
period
Senior
Xiong Jianming 752,078 0 192,750 944,828 management None
share
Total 752,078 0 192,750 944,828 -- --
2. Share placing and listing
1. Securities issuance (excluding preference shares) during the report period
□ 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
Total number of
Total number of shareholders of
Number of Number of
ordinary share preference shares
shareholders of shareholders of
shareholders at of which voting
common shares preferred stocks of
47,030 the end of the 40,846 0 rights resumed at 0
at the end of which voting rights
month before the the end of the
the report recovered in the
disclosure date of month before the
period report period
the annual report disclosure date of
the annual report
Shareholders holding 5% of the Company's shares or top-10 shareholders
42
China Fangda Group Co., Ltd. 2015 Annual Report
Number of Pledging or freezing
shares held Change in
Conditi Amount of
Properties of Sharehold at the end the
Shareholder onal shares without
shareholder ing of the reporting Share status Amount
shares sales restriction
reporting period
period
Shenzhen Banglin
Domestic
Technologies
non-state legal 9.09% 68,774,273 0 68,774,273 Pledged 39,000,000
Development Co.,
person
Ltd.
Shengjiu Foreign legal 10,016,13
6.32% 47,861,730 47,861,730
Investment Ltd. person 9
GUOTAI JUNAN
SECURITIES(HO Foreign legal 31,910,03
4.44% 33,634,890 33,634,890
NGKONG) person 9
LIMITED
China Foreign
Economic and
Trade Trust Co.,
Ltd. – Foreign
Trade 18,433,42
Others 2.44% 18,433,428 18,433,428
TrustAnying 8
Jinpeng Phase 1
Securities
Investment
Collective Program
Shenzhen Shilihe Domestic
Investment Co., non-state legal 2.36% 17,860,992 0 17,860,992
Ltd. person
Huabao Trust Co.,
Ltd. – Tiangao 17,782,78
Others 2.35% 17,782,782 17,782,782
Capital No.1 Trust 2
Program
Domestic natural
Zhou Shijian 2.14% 16,213,500 -4,909,981 16,213,500
person
Haitong
International
Securities Foreign legal 12,267,96
1.62% 12,267,968 12,267,968
Company person 8
Limited-Account
Client
43
China Fangda Group Co., Ltd. 2015 Annual Report
Domestic natural -19,321,20
Huang Jupei 1.41% 10,679,800 10,679,800
person 0
Shenwan
Hongyuan Foreign legal
1.13% 8,533,186 8,533,186 8,533,186
Securities (Hong person
Kong) Co., Ltd.
A strategic investor or ordinary legal
person becomes the Top10 shareholder None
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. 47,861,730 listed in domestic 47,861,730
exchanges
GUOTAI JUNAN Foreign shares
SECURITIES(HONGKONG) 33,634,890 listed in domestic 33,634,890
LIMITED exchanges
China Foreign Economic and Trade
Trust Co., Ltd. – Foreign Trade
RMB common
TrustAnying Jinpeng Phase 1 18,433,428 18,433,428
shares
Securities Investment Collective
Program
RMB common
Shenzhen Shilihe Investment Co., Ltd. 17,860,992 17,860,992
shares
Huabao Trust Co., Ltd. – Tiangao RMB common
17,782,782 17,782,782
Capital No.1 Trust Program shares
RMB common
Zhou Shijian 16,213,500 16,213,500
shares
Foreign shares
Haitong International Securities
12,267,968 listed in domestic 12,267,968
Company Limited-Account Client
exchanges
44
China Fangda Group Co., Ltd. 2015 Annual Report
RMB common
Huang Jupei 10,679,800 10,679,800
shares
Foreign shares
Shenwan Hongyuan Securities (Hong
8,533,186 listed in domestic 8,533,186
Kong) Co., Ltd.
exchanges
No action-in-concert or related parties Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and
among the top10 unconditional Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology
shareholders and between the top10 Development Co., Ltd. and Shenzhen Shilihe Investment Co., Ltd. are related parties. The
unconditional shareholders and the Company is not notified of other action-in-concert or related parties among the other
top10 shareholders holders of current shares.
Zhou Shijian holds 16,213,500 shares of the Company through the client credit trade
Top-10 common share shareholders
securities account of GF Securities; Huang Jupei holds 10,678,800 shares of the Company
participating in margin trade
through the client credit trade securities account of GF Securities;
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
□ Yes √ No
No 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
Shareholder nature: natural person holding
Type of shareholder: legal person
Legal
Name of controlling
representative/respon Date of establishment Organization code Main business
shareholder
sible person
Industrial investment,
Shenzhen Banglin developing of electronic
Technologies Development Chen Jinwu 07.06.01 914403007298400552 products, technical
Co., Ltd. consulting, domestic
commerce, material trading
Stock ownership of other
domestic and overseas listed
company controlled or whose None
shares are held by controlling
shareholders
Changes in the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
No change in the controlling shareholder in the report period
45
China Fangda Group Co., Ltd. 2015 Annual Report
3. Substantial controller of the Company
Nature of actual controller: domestic natural person
Type of actual controller: natural person
Name of substantial controller Nationality Right of residence in another country or region
Xiong Jianming Chinese Yes
Job and position Chair of the Board and president of the Company
Profiles of domestic and overseas listed
companies in which the controller held The controller held no share in other listed companies in the last ten years.
shares
Change in the actual controller in the report period
□ Applicable √ Inapplicable
No change in the actual shareholder in the report period
Chart of the controlling relationship
Controlling over the Company by the substantial controller through trust or other asset management
□ Applicable √ Inapplicable
4. Other legal person shareholders with over 10% of total shares
□ Applicable √ Inapplicable
5. Conditional decrease of shareholding by controlling shareholder, actual controller, reorganizer and
other entities
□ Applicable √ Inapplicable
46
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 7 Preferred Shares
□ Applicable √ Inapplicable
The Company had no preferred share in the report period.
47
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 8 Particulars about the Directors, Supervisors, Senior
Management and Employees
1. Changes in shareholding of Directors, Supervisors and Senior Management
Number
Increased Decrease Other Number
of shares
Starting End date shares in d shares increase of shares
held at
Name Position Job status Sex Age date of of the this in this and held at
beginning
the term term period period decrease end of the
of the
(share) (share) (share) period
period
Chairman
Xiong
, In office M 58 20.11.95 31.03.17 1,002,771 257,000 0 0 1,259,771
Jianming
president
Director,
Wang
vice In office M 58 20.11.95 31.03.17 36,286 0 0 0 36,286
Shengguo
president
Xiong
Director In office M 47 16.04.99 31.03.17
Jianwei
Zhou
Director In office M 53 09.04.07 31.03.17
Zhigang
Secretary
Zhou
of the In office M 53 22.10.03 31.03.17
Zhigang
Board
Independ
Guo
ent In office M 50 31.03.14 31.03.17
Wanda
director
Independ
Lin Bin ent In office M 53 31.03.14 31.03.17
director
Senior
Deng Lei In office M 37 16.02.16 31.03.17
partner
Superviso
ry
Zhen Hua Committe In office F 56 27.05.05 31.03.17
e meeting
convener
48
China Fangda Group Co., Ltd. 2015 Annual Report
Yin Superviso
In office M 47 31.03.14 31.03.17
Changjian r
Zen Superviso
In office M 46 31.03.14 31.03.17
Xiaowu r
Vice
Lin Kebin president In office M 38 06.06.08 31.03.17
and CFO
Wei Vice
In office M 47 29.07.11 31.03.17
Yuexing president
Independ
Huang
ent Resigned M 53 25.03.11 16.02.16
Yaying
director
Total -- -- -- -- -- -- 1,039,057 257,000 0 0 1,296,057
2. Changes in the Directors, Supervisors and Senior Executives
Name Job Type Date Reason
Independent
Huang Yaying Resigned 16.02.16 Huang Yaying has resigned due to person reasons
director
3. Office Description
Professional background, work experience and main duties in the Company of existing directors, supervisors and
senior management
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 is
now the chairman and CEO of the Company, representative of the 6th Shenzhen People's Congress, president of
the Shenzhen Semi-conductor Lighting Industry Promotion Association, chairman of Shenzhen Jiangxi
Commerce Chamber, chairman of Shenzhen Nanshan District Industry and Commerce Association and honorary
chairman of Shenzhen Nanshan District Charity.
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 a director of the Company and chairman of the board of directors of Fangda
Jianke.
Mr. Zhou Zhigang, bachelor’s degree. He is currently a Director, Secretary of Board, and head of the
Securities Dept and HR Dept.
Mr. Guo Wanda: He is an Economics Ph. D and researcher. 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 consulting services. He is an independent director of the Company.
49
China Fangda Group Co., Ltd. 2015 Annual Report
Lin Bin is an economics (accounting) Ph. D. 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, and independent director of the company.
Mr. Deng Lei is a law Ph. D and post-doctor in the financial securities law of Shenzhen Stock Exchange. He
was once the vice director of Corporate Law Affair Commission of Shenzhen Lawyer Association and a senior
partner of Guangdong China Commercial Law Firm.
Ms. Zhenghua holds a bachelor’s degree and is the convener of supervisory meetings of the Company.
Yin Changjian holds bachelor's degree and is a CPA. He was once the vice general manager of the Beijing
branch of Fangda Jianke and is the deputy director of the Company’s Supervisory Dept and staff representative
supervisor.
Zeng Xiaowu holds a master's degree and is a senior engineer. He was once the vice general manager of
Fangda Jianke, president of the design institute. He is now the chief engineer of Fangda Jianke and supervisor of
the Company.
Mr. Lin Kebin holds a bachelor’s degree. At present he’s the Vice President and CFO of the Company.
Mr. Wei Yuexing holds a Bachelor degree and is a senior engineer. He is the vice president of the Company
and general manager of Fangda Jianke.
Offices held at shareholders entities
√ Applicable □ Inapplicable
Whether any
Starting date of End date of the remuneration is
Name Shareholder entity Office
the term term paid at the
shareholder entity
Xiong Jianming Shengjiu Investment Ltd. Chairman 06.10.11 No
Wang
Shenzhen Shilihe Investment Co., Ltd. Chairman 19.10.06 No
Shengguo
Wang General
Shenzhen Shilihe Investment Co., Ltd. 29.09.03 No
Shengguo manager
Xiong Jianwei Shenzhen Shilihe Investment Co., Ltd. Director 12.06.01 No
Zhou Zhigang Shenzhen Shilihe Investment Co., Ltd. Director 19.10.06 No
Zhen Hua Shenzhen Shilihe Investment Co., Ltd. Supervisor 19.10.06 No
Office
None
description
Offices held at other entities
√ Applicable □ Inapplicable
Whether any
Starting date of End date of the remuneration is
Name Entity name Office
the term term paid at the
shareholder entity
50
China Fangda Group Co., Ltd. 2015 Annual Report
General development research institute Standing vice
Guo Wanda 01.07.07 Yes
(Shenzhen, China) president
Shenzhen Baode Technology Group Co., Independent
Guo Wanda 06.06.08 Yes
Ltd. director
Management School of Sun Yat-Sen
Lin Bin Professor 01.10.98 Yes
University
Guangzhou Baiyun International Airport Independent
Lin Bin 27.06.13 Yes
Company Limited director
Independent
Lin Bin Guangzhou Pearl River Beer Co., Ltd. 19.06.12 Yes
director
Deng Lei Guangdong China Commercial Law Firm Senior partner 01.11.15 Yes
Independent
Deng Lei Guangdong Chaohua Technology Co., Ltd. 11.11.15 Yes
director
Independent
Deng Lei Wuhan Gaode Infrared Co., Ltd. 23.04.15 Yes
director
Independent
Deng Lei Shenzhen Haimingrun Industrial Co., Ltd. 18.11.14 Yes
director
Office
The above-mentioned three are independent directors of the Company.
description
Penalties given by existing securities regulators on directors, supervisors and senior management and those who
have resigned in the report period
□ Applicable √ Inapplicable
4. Remunerations of the Directors, Supervisors and Senior Executives
Decision making procedures, basis and actual payment of remunerations of the Directors, Supervisors and Senior
Executives
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
Remuneration
Total
Name Position Sex Age Job status from related
remuneration
parties
Xiong Jianming Chairman, M 58 In office 176.7 No
51
China Fangda Group Co., Ltd. 2015 Annual Report
president
Director, vice
Wang Shengguo M 58 In office 92.65 No
president
Xiong Jianwei Director M 47 In office 93.17 No
Director,
Zhou Zhigang secretary of the M 53 In office 67.81 No
Board
Independent
Huang Yaying M 53 Resigned 8 No
director
Independent
Guo Wanda M 50 In office 8 No
director
Independent
Lin Bin M 53 In office 8 No
director
Supervisory
Zhen Hua Committee F 56 In office 26.38 No
meeting convener
Yin Changjian Supervisor M 47 In office 35 No
Zen Xiaowu Supervisor M 46 In office 60.24 No
Vice president
Lin Kebin M 38 In office 77.09 No
and CFO
Wei Yuexing Vice president M 47 In office 94.84 No
Total -- -- -- -- 747.88 --
Equity incentive programs provided for the Directors, Supervisors and Senior Executives of the Company during
the reporting period
□ Applicable √ Inapplicable
5. Employees
1. Staff number, professional composition and education
Staff number of the parent 65
Staff number of major subsidiaries 1,531
Total staff number 2,327
Number of employees receiving remuneration in the period 2,327
Resigned and retired staff number to whom the parent and major
0
subsidiaries need to pay remuneration
Professional composition
Categories of professions Number of people
52
China Fangda Group Co., Ltd. 2015 Annual Report
Production 840
Sales & Marketing 110
Technicians 1,267
Finance & Accounting 66
Executive 44
Total 2,327
Education
Categories of education Number of people
High school or below 1,124
College diploma 412
Bachelor 766
Master’s degree 23
Doctor’s degree 2
Total 2,327
2. Remuneration policy
Staff remuneration policy: The Company’s staff remuneration comprises post wage, performance wage, allowance
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.
3. Training program
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.
4. Labor outsourcing
√ Applicable □ Inapplicable
Total number of hours of labor outsourcing 10,051,369
Total remuneration paid for labor outsourcing (RMB) 301,541,074.02
53
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 9 Corporate 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.
Major difference between the actual corporate governance and regulations on corporate governance of listed
companies issued by CSRC
□ Yes √ No
There is no major difference between the actual corporate governance and regulations on corporate governance of
listed companies issued by CSRC.
2. 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.
54
China Fangda Group Co., Ltd. 2015 Annual Report
3. Competition
□ Applicable √ Inapplicable
4. Annual and extraordinary shareholder meetings held during the report period
1. Annual shareholder meeting during the report period
Index for
Participation of
Meeting Type Date of meeting Date of disclosure information
investors
disclosure
Notice on
st
1 Extraordinary Extraordinary Resolutions of the 1st
Shareholders’ shareholders’ 0.18% 13.01.15 14.01.15 Extraordinary
Meeting 2015 meeting Shareholders’
Meeting in 2015
Notice on
2014 Annual Resolutions of the
Annual shareholders’
Shareholders’ 0.01% 17.04.15 18.04.15 Annual
meeting
Meeting Shareholders’
Meeting in 2014
Notice on
Resolutions of the
2nd Extraordinary Extraordinary
2nd Extraordinary
Shareholders’ shareholders’ 0.02% 17.07.15 18.07.15
Shareholders’
Meeting 2015 meeting
Meeting in 2015
(2015-34)
Notice on
Resolutions of the
3rd Extraordinary Extraordinary
3rd Extraordinary
Shareholders’ shareholders’ 0.02% 23.11.15 24.11.15
Shareholders’
Meeting 2015 meeting
Meeting in 2015
(2015-56)
Notice on
Resolutions of the
4th Extraordinary Extraordinary
4th Extraordinary
Shareholders’ shareholders’ 0.04% 10.12.15 11.12.15
Shareholders’
Meeting 2015 meeting
Meeting in 2015
(2015-62)
55
China Fangda Group Co., Ltd. 2015 Annual Report
The participation percentage by investors means the percentage of investors in total shareholder number. Investors
mean natural person taking no office in the Company.
2. Shareholders of preference shares of which voting right resume convening an extraordinary
shareholders meeting
□ Applicable √ Inapplicable
5. 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 personnally telecom proxy
have attended meetings
Huang Yaying 10 4 4 2 0 No
Guo Wanda 10 4 5 1 0 No
Lin Bin 10 5 4 1 0 No
Time of presence by independent
10
directors at shareholders’ meetings
2. Objection raised by independent directors
Any objection raised by independent directors against the Company’s related issues
□ Yes √ No
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 2015
Date Issue Opinion
56
China Fangda Group Co., Ltd. 2015 Annual Report
type
Use of working capital by controlling shareholder and other associates
in 2014, conditions about guarantees made by the Company,
25.03.15 self-evaluation report of internal control in 2014, profit distribution
pre-plan in 2014, engagement of auditor in 2015, remuneration of
directors and senior management in 2014
Proposal of reducing investment of capital raised from private share
03.04.15 In favor
issuing in projects
Cancelling the private A-share issuance plan in 2014, accounts between
26.08.15 controlling shareholder and other associates in the first half of 2015 and
conditions about external guarantees
About 2015 private share issuance pre-plan and report on the use of
23.11.15
fund raised previously
6. 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 25.03.15, the Company held the 2nd meeting of the 7th Development Strategy Commission to listen to
the report on production and operation and production and operation plan for 2015.
2. On 27.08.15, the 3rd 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 2015 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 23.03.15, the 4th meeting of the Auditing Committee of the 7th term of the Board was held to review
the financial statements with the initial opinion issued by the CFA for 2014 and approve the auditor report issued
by the CFA. After the CFA issued to final auditor’s opinion, the Auditing Committee submitted the resolution on
the annual financial statements to the Board and issued the summary report on the auditing of the CFA for this
year.
2. On March 25, 2015, the Company held the 5th audit committee meeting of the 7th Board of Directors to
listen to the 2014 financial and internal audit report and approved (1) audited 2014 financial statements; (2)
proposal of engaging the auditor in 2015; (3) 2015 internal audit plan; (4) internal control self-evaluation report in
2014
The audit committee suggests that the internal audit body should increase communication with the audit
committee to help the committee better under the Company's condition and make higher requirements on the audit
quality.
3. On 17.04.15, the 6th meeting of the Auditing Committee of the 7th term of the Board approved the
unaudited Q1 financial statements.
4. On 26.08.15, the 7th meeting of the Auditing Committee of the 7th term of the Board on which the
57
China Fangda Group Co., Ltd. 2015 Annual Report
unaudited interim financial statements were approved.
5. On 26.08.15, the 8th meeting of the Auditing Committee of the 7th term of the Board on which the
unaudited Q3 financial statements were approved.
(3) Performance of the Remuneration and Assessment Committee
During the report period, the Remuneration and Assessment Committee issued the Working Regulations for
Remuneration and Assessment Committee. On the 2nd meeting of the Remuneration and Assessment Committee
of the 6th term of the Board held on 25.03.15, the committee reviewed the main financial indicators and business
performance in 2014 and reviewed performance of duties by the Company’s directors and senior executives. The
committee believes that the directors and senior executives have worked diligently and fulfilled the business target
and other tasks in 2014. The remunerations for directors, supervisors and senior executives disclosed in the 2012
annual report comply with the Company’s remuneration policy.
7. Performance of Supervisory Committee
(1) Risks for the Company discovered by the Supervisory Committee
□ Yes √ No
No disagreement with supervisory issues by the Supervisory Committee during the report period.
(2) The Supervisory Committee’ Work Report 2015
In 2015, the Supervisory Committee performed its duties and obligations in supervision and protect
shareholders’ and the Company’s interests in accordance with the Company Law, Share Listing Rules, Articles of
Association and Rules of the Procedure of the Supervisory Committee. The 2015 supervisory committee's work
plan is as follows:
1. Opinions
(1) Legal compliance
In the report period, the Company has been operated in accordance with law. The convening of meeting of
the Board and the decision-making process are compliant with law, regulations and Articles of Association; the
internal control system is solid. Directors and senior management have performed their obligations. No violation
against law, regulations, Articles of Association and interests of the Company and shareholders was discovered.
(2) Financial condition
During the period, the accounting management has been compliant with the Accounting Law, Enterprise
Accounting Standard. No false, misleading statement or significant omission was found in financial statements.
The financial reports of the Company reflect the Company’s financial position, operation performance, cash flows
and major risks truthfully, accurately and completely. The CPA has issued the standard auditor’s report in 2015,
which is objective, fair and truthful. It reflects the Company’s financial position and operation performance.
(3) Implementation of internal control
The design and operation of the internal control is effective and meets the Company’s management and
development requirements. It can ensure the truthfulness, lawfulness, completeness of the financial materials and
ensure the safety and completeness of the Company’s property. In 2015, there was no violation by the Company
against the Operation Regulations for Listed Companies in the Main Board of Shenzhen Stock Exchange and the
Company’s internal control system. The 2015 Internal Control Self-evaluation Report truthfully and objectively
reflects the establishment, implementation and improvement of the Company’s internal control system. There are
no significant or important problems in the financial and non-financial reports in the report period.
2. Meetings and resolutions of the supervisory meeting in the report period:
Six meetings were held in 2015, all of which are on-site meetings. All proposal were approved and disclosed
58
China Fangda Group Co., Ltd. 2015 Annual Report
as required:
Convening
No. Meeting Date Topic
method
1. Reviewing the Company’s 2014 Supervisory Committee’s
Work Report;
2. Reviewing the Company’s 2014 Annual Report and Summary;
3. Reviewing the Company’s 2014 Financial Settlement Report;
th
6 meeting of 4. Reviewing the Company’s Proposal of Profit Distribution in
th
the 7 2014;
1 25.03.15 On-site
Supervisory 5. Reviewing the Company’s Proposal of Engaging Auditor for
Committee 2015;
6. Reviewing the Company’s 2014 Internal Control
Self-evaluation Report;
7. Reviewing the Company’s Report on Deposit and Use of
Raised Fund in 2014;
1. Reviewing the Company’s Proposal of Decreasing the Fund to
be Raised by the Private Share Issuance Plan;
7th meeting of 2. Reviewing the Company’s Proposal of Private A-share
the 7th Issuance Plan (adjusted);
2 03.04.15 On-site
Supervisory 3. Reviewing the Company’s Proposal of Feasibility Report of the
Committee Private A-share Issuance Fund Usage;
4. Reviewing the Company's Proposal of Private A-share Issuance
Pre-plan (adjusted in April 2015)
8th meeting of
the 7th
3 17.04.15 On-site Reviewing the 2015 Q1 Report and Text;
Supervisory
Committee
9th meeting of
1. Reviewing the 2015 Interim Report and Summary;
the 7th
4 27.08.15 On-site 2. Reviewing the Proposal of Cancelling the Private A-share
Supervisory
Issuance Pre-plan for 2014
Committee
10th meeting
of the 7th
5 22.10.15 On-site Reviewing the 2015 Q3 Report and Text;
Supervisory
Committee
59
China Fangda Group Co., Ltd. 2015 Annual Report
1. Reviewing Proposal of Compliance with Private Share
Issuance Conditions;
2. Reviewing the Proposal of Private A-share Issuance Plan;
3. Reviewing the Proposal of Feasibility Report of the Private
11th meeting
A-share Issuance Fund Usage;
of the 7th
6 23.11.15 On-site 4. Reviewing the Proposal of Private A-share Issuance Pre-plan in
Supervisory
2015;
Committee
5. Reviewing the Proposal of Authorizing the Board of Directors
to Handle All Issues Related to the Private Share Issuance;
6. Reviewing the Proposal of Usage Report of Previously Raised
Fund
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
2015 Supervisory and Management Department Target Management and Assessment and Implementation
Regulations for 2015 Subordinate Unit Assessment.
9. Internal control
1. Major problems in internal control discovered in the report period
□ Yes √ No
2. Internal control self-evaluation report
Date of disclosure of the internal control
26.04.16
evaluation report
Disclosure of the internal control
www.cninfo.com.cn
evaluation report
Percentage of assets in the evaluation
scope in the total assets in the consolidated 98.95%
financial statements
Percentage of operation income in the
evaluation scope in the total operation
100.00%
income in the consolidated financial
statements
Standard
Type Financial report Non-financial report
60
China Fangda Group Co., Ltd. 2015 Annual Report
I. The following condition indicates
1. The following problems are considered significant problems in the internal
major problems: 1. Non-effective control control of non-financial reports 1.
environment; 2. corrupt practice by directors, Serious violation against national laws,
supervisor and senior management, causing regulations or specifications; 2. Serious
substantial loss and impacts for the business system problems and system
Company; 3. Substantial mistakes in the ineffectiveness; 3. Major or important
financial statements in the period discovered problems cannot be corrected; 4. Lack of
by the CPA, which are not discovered by the internal control and poor management; 5.
internal control; 4. Ineffective supervision of Loss of management personnel or key
the internal control by the Company’s employees; 6. Safety and environmental
auditing department2. The following accidents that cause major adverse
problems are considered significant impacts; 7. Other situations that cause
Standard problems: 1 accounting policies are selected major adverse impacts on the Company.
and used without complying to widely II. The following situations indicate that
accepted accounting standards; 2. No there may be significant problems with
anti-corrupt and important balance system the internal control: 1. business system
and control measures are taken; 3. Separate problems and system ineffectiveness; 2.
or multiple problems in the preparation of Major or important problems cannot be
financial reports, which are serious enough corrected; 3. Other situations that cause
to affecting the truthfulness and accuracy of major adverse impacts on the
the reports; no control system is established Companies. The following situation
and no related compensation system is indicate likely normal problems in the
implemented for accounts of irregular or internal control: 1. Problems in the
special transactions3. Other problems are general business system; 2. Normal
considered normal problems. problems in the internal control
supervision cannot be correctly promptly.
1. Significant problem: 1. Mistakes affecting
5% and more of the pre-tax profit and more
than RMB5 million in the consolidated
statements; 2. Mistakes affecting 5% and
more of the consolidated assets and more
See the recognition standard of the
than RMB5 million2. Important problem: 1.
Standard internal control problems for financial
Mistakes affecting 1%-5% of the pre-tax
statements
profit in the consolidated statements; 2.
Mistakes affecting 1%-5% the consolidated
assets.III. Normal problem: 1. Mistakes
affecting less than 1% of the pre-tax profit
and total assets of the consolidate statements.
Significant problems in financial
0
statements
Significant problems in non-financial
0
statements
61
China Fangda Group Co., Ltd. 2015 Annual Report
Important problems in financial statements 0
Important problems in non-financial
0
statements
10. Internal control audit report
√ Applicable □ Inapplicable
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
on Enterprise Internal Control and related regulations on 31.12.15.
Disclosure of internal auditor’s
Disclosed
report
Date of disclosure of the internal
26.04.16
control audit report
Source of disclosure of the internal
www.cninfo.com.cn
control audit report
Opinion type Standard opinion auditor’s report
Problems in non-financial
No
statements
Non-standard internal control audit report by the CFA
□ Yes √ No
Consistency between the internal control audit report and self-evaluation report
√ Yes □ No
62
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 10 Financial Statements
I. Auditors report
Type Standard opinion auditor’s report
Issued on 22.04.16
Auditor Grant Thornton (special general partner)
Report No. Grant Thornton (2016) No.350ZA0156
CPA names Xie Peiren, Hu Gaosheng
Auditors’ Report
Auditors report
Grant Thornton (2016) No.350ZA0156
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 31.12.15 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 2015, 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
63
China Fangda Group Co., Ltd. 2015 Annual Report
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
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 31.12.15, and the business performance and cash flow of year 2015.
Grand Thornton CPA CPA China Xie Peiren
(limited liability partnership)
CPA China Hu Gaosheng
Beijing, China April 22, 2016
II. Financial statements
Unit for statements in notes to financial statements: RMB yuan
1. Consolidated Balance Sheet
Prepared by: China Fangda Group Co., Ltd.
31.12.15
In RMB
Items Closing balance Opening balance
Current asset:
Monetary capital 400,953,337.32 212,430,798.87
Settlement provision
Outgoing call loan
Financial assets measured at fair
value with variations accounted into 14,546,206.58 13,410,790.00
current income account
64
China Fangda Group Co., Ltd. 2015 Annual Report
Derivative financial assets
Notes receivable 97,247,660.56 83,325,725.70
Account receivable 1,405,718,134.89 1,105,242,251.46
Prepayment 30,057,063.90 29,234,231.49
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance
contracts receivable
Interest receivable
Dividend receivable
Other receivables 53,095,948.46 48,950,647.67
Repurchasing of financial assets
Inventory 1,346,591,303.53 982,441,187.05
Assets held for sales
Non-current assets due in 1 year
Other current assets 11,395,718.05 234,986,107.72
Total current assets 3,359,605,373.29 2,710,021,739.96
Non-current assets:
Loan and advancement provided
Sellable financial assets
Investment held until mature
Long-term receivable
Long-term share equity investment 10,489,680.93 11,048,660.43
Investment real estate 335,328,805.74 226,279,523.39
Fixed assets 462,648,998.51 489,714,684.63
Construction in process 15,134,390.90 341,749.17
Engineering materials
Disposal of fixed assets 5,326.79 26,918.21
Productive biological assets
Gas & petrol
Intangible assets 95,062,982.48 98,947,331.09
R&D expense
Goodwill 19,826,696.97 26,279,395.89
Long-term amortizable expenses 6,614,788.88 4,119,362.63
65
China Fangda Group Co., Ltd. 2015 Annual Report
Deferred income tax assets 65,926,810.52 52,616,656.38
Other non-current assets 93,503,956.39 43,323,878.63
Total of non-current assets 1,104,542,438.11 952,698,160.45
Total of assets 4,464,147,811.40 3,662,719,900.41
Current liabilities
Short-term loans 1,147,957,775.82 1,100,000,000.00
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 303,527,639.63 227,266,485.57
Account payable 867,628,355.65 685,108,346.73
Prepayment received 130,574,319.85 122,285,231.14
Selling of repurchased financial
assets
Fees and commissions payable
Employees’ wage payable 40,942,428.05 41,703,314.26
Taxes payable 67,533,433.70 58,696,926.25
Interest payable 3,241,834.43 2,055,911.11
Dividend payable
Other payables 82,677,346.81 47,425,682.44
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 98,425,600.00
Total current liabilities 2,742,508,733.94 2,290,541,897.50
Non-current liabilities:
66
China Fangda Group Co., Ltd. 2015 Annual Report
Long-term loans 300,395,582.06
Bond payable
Including: preferred stock
Perpetual bond
Long-term payable 6,000,000.00
Long-term employees’ wage
payable
Special payables
Anticipated liabilities 1,921,446.51 5,859,045.98
Deferred earning 12,284,195.68 10,049,892.04
Deferred income tax liabilities 72,994,768.34 49,734,436.90
Other non-current liabilities
Total of non-current liabilities 387,595,992.59 71,643,374.92
Total liabilities 3,130,104,726.53 2,362,185,272.42
Owner’s equity:
Share capital 756,909,905.00 756,909,905.00
Other equity tools
Including: preferred stock
Perpetual bond
Capital reserves 79,099,619.14 79,099,220.38
Less: Shares in stock
Other miscellaneous income 91,831.63 91,831.63
Special reserves
Surplus reserves 51,123,554.51 48,842,080.76
Common risk provisions
Retained profit 432,271,424.56 349,987,825.69
Total of owner’s equity belong to the
1,319,496,334.84 1,234,930,863.46
parent company
Minor shareholders’ equity 14,546,750.03 65,603,764.53
Total of owners’ equity 1,334,043,084.87 1,300,534,627.99
Total of liabilities and owner’s interest 4,464,147,811.40 3,662,719,900.41
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Chen Yonggang
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China Fangda Group Co., Ltd. 2015 Annual Report
2. Balance Sheet of the Parent Company
In RMB
Items Closing balance Opening balance
Current asset:
Monetary capital 25,833,130.83 22,256,065.49
Financial assets measured at fair
value with variations accounted into
current income account
Derivative financial assets
Notes receivable
Account receivable 345,960.74 511,660.60
Prepayment 67,893.61 50,903.86
Interest receivable
Dividend receivable 28,639,627.17
Other receivables 375,591,349.76 254,604,163.79
Inventory
Assets held for sales
Non-current assets due in 1 year
Other current assets 990,624.25 31,005,620.01
Total current assets 402,828,959.19 337,068,040.92
Non-current assets:
Sellable financial assets
Investment held until mature
Long-term receivable
Long-term share equity investment 967,700,649.13 1,130,674,559.01
Investment real estate 290,288,531.53 198,513,586.15
Fixed assets 57,647,245.73 60,145,112.89
Construction in process
Engineering materials
Disposal of fixed assets
Productive biological assets
Gas & petrol
Intangible assets 1,907,601.33 2,256,575.64
R&D expense
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China Fangda Group Co., Ltd. 2015 Annual Report
Goodwill
Long-term amortizable expenses 403,800.10 81,367.47
Deferred income tax assets 37,948,384.39 22,623,560.72
Other non-current assets 220,000,000.00 220,000,000.00
Total of non-current assets 1,575,896,212.21 1,634,294,761.88
Total of assets 1,978,725,171.40 1,971,362,802.80
Current liabilities
Short-term loans 350,000,000.00 350,000,000.00
Financial liabilities measured at
fair value with variations accounted into
current income account
Derivative financial liabilities
Notes payable
Account payable 606,941.85 606,941.85
Prepayment received 748,421.47 832,772.45
Employees’ wage payable 1,868,710.30 1,956,875.76
Taxes payable 1,338,421.09 567,424.56
Interest payable 726,993.55 659,266.67
Dividend payable
Other payables 155,183,721.49 270,281,330.40
Liabilities held for sales
Non-current liabilities due in 1
year
Other current liabilities 98,425,600.00
Total current liabilities 608,898,809.75 624,904,611.69
Non-current liabilities:
Long-term loans
Bond payable
Including: preferred stock
Perpetual bond
Long-term payable
Long-term employees’ wage
payable
Special payables
Anticipated liabilities
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China Fangda Group Co., Ltd. 2015 Annual Report
Deferred earning
Deferred income tax liabilities 120,953,378.63 97,693,047.19
Other non-current liabilities
Total of non-current liabilities 120,953,378.63 97,693,047.19
Total liabilities 729,852,188.38 722,597,658.88
Owner’s equity:
Share capital 756,909,905.00 756,909,905.00
Other equity tools
Including: preferred stock
Perpetual bond
Capital reserves 38,598,963.76 38,598,565.00
Less: Shares in stock
Other miscellaneous income 91,831.63 91,831.63
Special reserves
Surplus reserves 51,123,554.51 48,842,080.76
Retained profit 402,148,728.12 404,322,761.53
Total of owners’ equity 1,248,872,983.02 1,248,765,143.92
Total of liabilities and owner’s interest 1,978,725,171.40 1,971,362,802.80
3. Consolidated Income Statement
In RMB
Items Amount occurred in the current period Occurred in previous period
1. Total revenue 2,550,467,494.78 1,938,324,435.51
Incl. Business income 2,550,467,494.78 1,938,324,435.51
Interest income
Insurance fee earned
Fee and commission
received
2. Total business cost 2,548,503,653.53 1,867,564,531.44
Incl. Business cost 2,171,524,200.35 1,590,836,786.02
Interest expense
Fee and commission paid
Insurance discharge payment
Net claim amount paid
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China Fangda Group Co., Ltd. 2015 Annual Report
Net insurance policy
reserves provided
Insurance policy dividend
paid
Reinsurance expenses
Business tax and surcharge 33,616,556.60 22,855,639.99
Sales expense 75,264,951.18 44,684,306.70
Administrative expense 167,405,776.25 152,584,713.60
Financial expenses 50,672,490.05 29,165,058.80
Asset impairment loss 50,019,679.10 27,438,026.33
Plus: gains from change of fair value
89,746,065.58 32,044,747.10
(“-“ for loss)
Investment gains (“-“ for loss) 280,949.87 1,720,693.98
Incl. Investment gains from
-358,979.50 1,054,094.88
affiliates and joint ventures
Exchange gains (“-“ for loss)
3. Operational profit (“-“ for loss) 91,990,856.70 104,525,345.15
Plus: non-operational income 29,668,110.25 16,281,459.18
Incl. Loss from disposal of
51,130.66 3,162,999.40
non-current assets
Less: non-operational expenditure 18,233,740.07 10,623,712.10
Incl. Loss from disposal of
574,079.38 1,709,152.13
non-current assets
4. Gross profit (“-“ for loss) 103,425,226.88 110,183,092.23
Less: Income tax expenses 35,209,871.61 17,493,747.57
5. Net profit (“-“ for net loss) 68,215,355.27 92,689,344.66
Net profit attributable to the owners
107,272,369.77 96,998,429.76
of parent company
Minor shareholders’ equity -39,057,014.50 -4,309,085.10
6. After-tax net amount of other misc.
incomes
After-tax net amount of other misc.
incomes attributed to parent's owner
(1) Other misc. incomes that cannot
be re-classified into gain and loss
1. Change in net liabilities or
assets due to re-measurement set benefit
71
China Fangda Group Co., Ltd. 2015 Annual Report
program
2. Shares enjoyed in other
misc. incomes that cannot be reclassified
into gain and loss by the invested entity
under the equity law
(2) Other misc. incomes that will be
re-classified into gain and loss
1. Shares enjoyed in other
misc. incomes that cannot be reclassified
into gain and loss by the invested entity
under the equity law
2．Change in the fair value of
financial asset for sale
3 Held-to-mature investment
reclassified as gain and loss in the
financial assets for sales
4. Effective part in the gain
and loss of arbitrage of cash flow
5. Translation difference of
foreign exchange statement
6. Others
After-tax net of other misc. income
attributed to minority shareholders
7. Total of misc. incomes 68,215,355.27 92,689,344.66
Total of misc. incomes attributable
107,272,369.77 96,998,429.76
to the owners of the parent company
Total misc gains attributable to the
-39,057,014.50 -4,309,085.10
minor shareholders
8. Earnings per share:
(1) Basic earnings per share 0.14 0.13
(2) Diluted earnings per share 0.14 0.13
Net profit contributed by entities merged under common control in the report period was RMB0.00, net profit realized by parties
merged during the previous period is RMB0.00.
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Chen Yonggang
4. Income Statement of the Parent Company
In RMB
72
China Fangda Group Co., Ltd. 2015 Annual Report
Items Amount occurred in the current period Occurred in previous period
1. Turnover 29,977,446.65 29,609,371.13
Less: Operation cost 3,788,422.31 5,669,281.13
Business tax and surcharge 3,182,704.86 2,420,213.38
Sales expense
Administrative expense 25,503,319.50 24,285,538.55
Financial expenses 10,990,269.77 13,398,214.90
Asset impairment loss 50,302,743.84 27,045,993.77
Plus: gains from change of fair
91,774,945.38 34,897,632.10
value (“-“ for loss)
Investment gains (“-“ for loss) -292,417.86 29,805,392.25
Incl. Investment gains from
-358,979.50 1,054,094.88
affiliates and joint ventures
2. Operational profit (“-“ for loss) 27,692,513.89 21,493,153.75
Plus: non-operational income 3,063,312.33 2,441,486.71
Incl. Loss from disposal of
3,581.20 22,719.41
non-current assets
Less: non-operational expenditure 5,580.96 608,712.42
Incl. Loss from disposal of
3,675.31 207,212.42
non-current assets
3. Gross profit (“-“ for loss) 30,750,245.26 23,325,928.04
Less: Income tax expenses 7,935,507.77 -1,203,457.42
4. Net profit (“-“ for net loss) 22,814,737.49 24,529,385.46
5. After-tax net amount of other misc.
incomes
(1) Other misc. incomes that
cannot be re-classified into gain and
loss
1. Change in net liabilities
or assets due to re-measurement set
benefit program
2. Shares enjoyed in other
misc. incomes that cannot be
reclassified into gain and loss by the
invested entity under the equity law
(2) Other misc. incomes that will
be re-classified into gain and loss
73
China Fangda Group Co., Ltd. 2015 Annual Report
1. Shares enjoyed in other
misc. incomes that cannot be
reclassified into gain and loss by the
invested entity under the equity law
2．Change in the fair value
of financial asset for sale
3 Held-to-mature
investment reclassified as gain and loss
in the financial assets for sales
4. Effective part in the gain
and loss of arbitrage of cash flow
5. Translation difference of
foreign exchange statement
6. Others
6. Total of misc. incomes 22,814,737.49 24,529,385.46
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
2,136,257,004.69 1,651,025,342.09
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. 2015 Annual Report
Increase in proposal of 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 2,935,298.45 1,735,709.16
Other cash received from business
80,410,147.38 31,286,645.67
operation
Sub-total of cash inflow from business
2,219,602,450.52 1,684,047,696.92
operations
Cash paid for purchasing products
2,044,378,497.19 1,796,240,670.15
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 274,034,752.64 225,245,085.75
Taxes paid 103,333,723.21 86,882,633.93
Other cash paid for business
157,970,591.52 133,573,236.53
activities
Sub-total of cash outflow from business
2,579,717,564.56 2,241,941,626.36
operations
Cash flow generated by business
-360,115,114.04 -557,893,929.44
operations, net
2. Cash flow generated by investment:
Cash received from investment
392,316,868.51 294,000,000.00
recovery
Cash received as investment profit 2,839,929.37 2,144,844.81
75
China Fangda Group Co., Ltd. 2015 Annual Report
Net cash retrieved from disposal of
fixed assets, intangible assets, and other 2,480,137.42 5,912,795.35
long-term assets
Net cash received from disposal of
subsidiaries or other operational units
Other investment-related cash
65,500.00
received
Sub-total of cash inflow generated from
397,636,935.30 302,123,140.16
investment
Cash paid for construction of fixed
assets, intangible assets and other 43,406,919.71 33,875,128.34
long-term assets
Cash paid as investment 169,500,000.00 538,263,675.00
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 263,000.00 331,500.00
Subtotal of cash outflows 213,169,919.71 588,172,728.21
Cash flow generated by investment
184,467,015.59 -286,049,588.05
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
1,764,927,430.10 1,303,817,100.01
loans
Cash received from bond placing
Other cash received from financing
398.76
activities
Subtotal of cash inflow from financing
1,764,927,828.86 1,303,817,100.01
activities
Cash paid to repay debts 1,286,786,500.00 575,000,000.00
Cash paid as dividend, profit, or
103,109,040.79 67,732,507.84
interests
Incl. Dividend and profit paid by
subsidiaries to minority shareholders
76
China Fangda Group Co., Ltd. 2015 Annual Report
Other cash paid for financing
54,563,032.79
activities
Subtotal of cash outflow from financing
1,444,458,573.58 642,732,507.84
activities
Net cash flow generated by financing
320,469,255.28 661,084,592.17
activities
4. Influence of exchange rate changes
279,854.76 259,902.13
on cash and cash equivalents
5. Net increase in cash and cash
145,101,011.59 -182,599,023.19
equivalents
Plus: Balance of cash and cash
102,638,232.19 285,237,255.38
equivalents at the beginning of term
6. Balance of cash and cash equivalents
247,739,243.78 102,638,232.19
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
26,164,484.77 25,532,652.79
products and providing of services
Tax refunded
Other cash received from business
755,679,626.68 535,560,936.32
operation
Sub-total of cash inflow from business
781,844,111.45 561,093,589.11
operations
Cash paid for purchasing products
4,416,622.18 6,265,876.89
and services
Cash paid to and for the staff 13,896,383.34 12,900,103.54
Taxes paid 2,788,279.54 2,806,998.73
Other cash paid for business
879,561,369.67 144,910,876.80
activities
Sub-total of cash outflow from business
900,662,654.73 166,883,855.96
operations
Cash flow generated by business
-118,818,543.28 394,209,733.15
operations, net
77
China Fangda Group Co., Ltd. 2015 Annual Report
2. Cash flow generated by investment:
Cash received from investment
30,000,000.00 20,000,000.00
recovery
Cash received as investment profit 44,373,922.22 39,860,211.87
Net cash retrieved from disposal of
fixed assets, intangible assets, and other 4,190.00 66,000.00
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
74,378,112.22 59,926,211.87
investment
Cash paid for construction of fixed
assets, intangible assets and other 772,927.30 3,257,461.79
long-term assets
Cash paid as investment 2,000,000.00 707,011,633.00
Net cash paid for acquiring
subsidiaries and other operational units
Other cash paid for investment
Subtotal of cash outflows 2,772,927.30 710,269,094.79
Cash flow generated by investment
71,605,184.92 -650,342,882.92
activities, net
3. Cash flow generated by financing
activities:
Cash received from investment
Cash received from borrowed
448,425,600.00 446,000,000.00
loans
Cash received from bond placing
Other cash received from financing
398.76
activities
Subtotal of cash inflow from financing
448,425,998.76 446,000,000.00
activities
Cash paid to repay debts 350,000,000.00 200,000,000.00
Cash paid as dividend, profit, or
47,001,477.37 35,741,367.15
interests
Other cash paid for financing
624,032.79
activities
78
China Fangda Group Co., Ltd. 2015 Annual Report
Subtotal of cash outflow from financing
397,625,510.16 235,741,367.15
activities
Net cash flow generated by financing
50,800,488.60 210,258,632.85
activities
4. Influence of exchange rate changes
-10,064.90 -93,226.35
on cash and cash equivalents
5. Net increase in cash and cash
3,577,065.34 -45,967,743.27
equivalents
Plus: Balance of cash and cash
22,006,065.49 67,973,808.76
equivalents at the beginning of term
6. Balance of cash and cash equivalents
25,583,130.83 22,006,065.49
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
Minor
Other equity tools Other Commo Total of
Items Less: shareho
Share Prefer Perpet Capital miscella Special Surplus n risk Retaine owners’
Shares lders’
Other equity
capital red ual reserves neous reserves reserves provisio d profit
in stock equity
s
share bond income ns
756,90 1,300,5
1. Balance at the 79,099, 91,831. 48,842, 349,987 65,603,
9,905. 34,627.
end of last year 220.38 63 080.76 ,825.69 764.53
00 99
Plus:
Changes in
accounting
policies
Correction of
previous errors
Consolidation of
entities under
common control
Others
2. Balance at the 756,90 1,300,5
79,099, 91,831. 48,842, 349,987 65,603,
beginning of 9,905. 34,627.
79
China Fangda Group Co., Ltd. 2015 Annual Report
current year 00 220.38 63 080.76 ,825.69 764.53 99
3. Amount of
change in current 2,281,4 82,283, -51,057, 33,508,
398.76
term (“-“ for 73.75 598.87 014.50 456.88
decrease)
(1) Total of misc. 107,272 -39,057, 68,215,
incomes ,369.77 014.50 355.27
(2) Investment or
-12,000, -11,999,
decreasing of 398.76
000.00 601.24
capital by owners
1. Common shares
contributed by
shareholders
2. Capital
contributed by
other equity
instrument holders
3. Amount of
shares paid and
accounted as
owners’ equity
-12,000, -11,999,
4. Others 398.76
000.00 601.24
(3) Profit 2,281,4 -24,988, -22,707,
allotment 73.75 770.90 297.15
1. Providing of 2,281,4 -2,281,4
surplus reserves 73.75 73.75
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. 2015 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
(6) Others
756,90 1,334,0
4. Balance at the 79,099, 91,831. 51,123, 432,271 14,546,
9,905. 43,084.
end of this period 619.14 63 554.51 ,424.56 750.03
00 87
Amount of the Previous Term
In RMB
Last period
Owners’ Equity Attributable to the Parent Company
Minor
Other equity tools Other Commo Total of
Items Less: shareho
Share Prefer Perpet Capital miscella Special Surplus n risk Retaine owners’
Shares lders’
Other equity
capital red ual reserves neous reserves reserves provisio d profit
in stock equity
s
share bond income ns
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 year 220.38 63 142.21 ,631.63 446.89
00 74
Plus:
Changes in
accounting
policies
Correction of
previous errors
Consolidation of
entities under
common control
Others
81
China Fangda Group Co., Ltd. 2015 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 year 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, 92,689,
incomes 429.76 085.10 344.66
(2) Investment or
16,000, 16,000,
decreasing of
000.00 000.00
capital by owners
1. Common shares
16,000, 16,000,
contributed by
000.00 000.00
shareholders
2. Capital
contributed by
other equity
instrument 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)
82
China Fangda Group Co., Ltd. 2015 Annual Report
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
-1,519, -1,519,5
(6) Others
597.26 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
8. Statement of Change in Owners Equity (Parent Company)
Amount of the Current Term
In RMB
Current period
Other equity tools Other
Less: Total of
Items Share Capital miscellan Special Surplus Retaine
Preferre Perpetu Shares in owners’
capital Others reserves eous reserves reserves d profit
d share al bond stock equity
income
1. Balance at the 756,909, 38,598,56 48,842,08 404,322 1,248,765
91,831.63
end of last year 905.00 5.00 0.76 ,761.53 ,143.92
Plus:
Changes in
accounting
policies
Correction of
previous errors
Others
2. Balance at the 756,909, 38,598,56 48,842,08 404,322 1,248,765
91,831.63
beginning of 905.00 5.00 0.76 ,761.53 ,143.92
83
China Fangda Group Co., Ltd. 2015 Annual Report
current year
3. Amount of
change in current 2,281,473 -2,174,0 107,839.1
398.76
term (“-“ for .75 33.41 0
decrease)
(1) Total of misc. 22,814, 22,814,73
incomes 737.49 7.49
(2) Investment or
decreasing of 398.76 398.76
capital by owners
1. Common shares
contributed by
shareholders
2. Capital
contributed by
other equity
instrument holders
3. Amount of
shares paid and
accounted as
owners’ equity
4. Others 398.76 398.76
(3) Profit
2,281,473 -24,988, -22,707,2
allotment
.75 770.90 97.15
1. Providing of 2,281,473 -2,281,4
surplus reserves .75 73.75
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. 2015 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, 38,598,96 51,123,55 402,148 1,248,872
91,831.63
end of this period 905.00 3.76 4.51 ,728.12 ,983.02
Amount of the Previous Term
In RMB
Last period
Other equity tools Other
Less: Total of
Items Share Capital miscellan Special Surplus Retaine
Preferre Perpetu Shares in owners’
capital Others reserves eous reserves reserves d profit
d share al bond stock equity
income
1. Balance at the 756,909, 38,598,56 46,389,14 404,953 1,246,943
91,831.63
end of last year 905.00 5.00 2.21 ,611.77 ,055.61
Plus:
Changes in
accounting
policies
Correction of
previous errors
Others
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 year
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
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China Fangda Group Co., Ltd. 2015 Annual Report
(2) Investment or
decreasing of
capital by owners
1. Common shares
contributed by
shareholders
2. Capital
contributed by
other equity
instrument 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
shares)
3. Making up
losses by surplus
reserves
4. Others
(5) Special
reserves
1. Provided this
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China Fangda Group Co., Ltd. 2015 Annual Report
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
III. General Information
China Fangda Group Co., Ltd. (the “Company” or the “Group”) is a joint stock company registered in Shenzhen,
Guangdong and was approved by the Government of Shenzhen with Document 深府办函 (1995) 194号, and
was founded, on the basis of Shenzhen Fangda Construction Material Co., Ltd., by way of share issuing 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, Fangda Property and
Fangda New Energy.
The business nature and main business operations of the Company and subsidiaries (“the Group”) include (1)
production and sales of curtain wall materials, design, production and installation of construction curtain walls; (2)
assembly and production of subway screen doors; (3) development and operation of real estate projects on land, of
which rights have been obtained lawfully; (4) R&D, installation and sales of PV devices, design and installation
of PV power plants, R&D, design, production, sales and installation of lights, electric auxiliaries and other
equipment, LED products and metal products.
The financial statements and notes are approved at the 20th meeting of the 7th term of the Board held on 22.04.16.
The consolidation scope for the consolidated financial statements includes the Company and all subsidiaries. The
entities newly consolidated this period include eight subsidiaries. Hong Kong Junjia Group Co., Ltd. is written off
this period. See Note VI. Change to the Consolidation Scope and Note 7. Disclosure of Interest in Other Entities
for details.
IV. Basis for the preparation of financial statements
1. Preparation basis
The financial statements are prepared according to the enterprise financial standard and guidelines, interpretation
and other related regulations (“the Standard”) issued by the Ministry of Finance. The Group has also disclosed
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China Fangda Group Co., Ltd. 2015 Annual Report
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.
The Group prepares the financial statements based on continuous operation.
The Group's auditing 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 Account Policies and Estimates
Specific accounting policy and estimate prompt:
The Group determines the accounting policies and income recognition policies for investment real estate
according to the production and business features. For details, see Note V. 13 and Note V. 22.
1. Statement of compliance to the Enterprise Accounting Standard
The financial report and statements are prepared with compliance to the requirement of the Enterprise Accounting
Standard. They reflect the financial position as of 31.12.15, and business performance and cash flow situation in
Year 2015 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. Operation period
The operation period of the Group is 12 months.
4. Bookkeeping standard money
The Group takes RMB as the standard currency for bookkeeping.
5. 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
the merger day in the consolidated financial statement of the merging party 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.
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China Fangda Group Co., Ltd. 2015 Annual Report
Enterprise merger under common control through multiple transactions
In separate financial statements, the initial investment cost is the book value of the merged party’s net assets that
can be shared by the merging party in the consolidate financial statements of the final controlling party according
to the shareholding percentage on the merging date; adjust the capital surplus (share premium) according to the
difference between the initial investment cost and the book value of the held investment before merger plus the
book value of the consideration paid on the merger date. Where the capital surplus falls short, the retained income
should be adjusted.
In consolidated financial statements, assets and liabilities obtained by the merging party from the merged party
should be measured at the book value in the final controlling party’s consolidated financial statements other than
the adjustment made due to differences in accounting policies; adjust the capital surplus (share premium)
according to the difference between the initial investment cost and the book value of the held investment before
merger plus the book value of the consideration paid on the merger date. Where the capital surplus falls short, the
retained income should be adjusted. Changes in recognized related profit and loss, other misc. incomes and other
owner's equity between the later one of the date when the original stock equity was obtained and the date when the
merged party and merging party become under the common control should respectively write down the retained
profit in beginning of the report period or current period’s profit or loss.
(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 Group 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.
Where there is new or further evidence on the condition existing on the acquisition date 12 months later and
adjustment needs to be made, the good will should be adjusted and merged.
(3) Treatment of related transaction fee in enterprise 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 consolidate scope of consolidated financial statements is determined based on control. Control means the
power possessed by the Group on invested entities to share variable returns by participating in related activities of
the invested entities and to impact the amount of the returns by using the power. Subsidiaries are enterprises
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China Fangda Group Co., Ltd. 2015 Annual Report
controlled by the Company.
(2) Preparation of Consolidated Financial Statements
The 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 increased because of merger of enterprises under the common control during the
report period are deemed consolidated into the consolidate scope from the date of becoming controlled by the
final party. The operating result and cash flows of the subsidiaries and businesses from the date of becoming
controlled by the final party should be incorporated into the consolidate income statement and consolidate cash
flow statement.
For subsidiaries and businesses increased because of merger of enterprises not under the common control, their
incomes, expenses and profits between the date of acquisition and end of the report period should be incorporated
into the consolidated income statement, and the cash flows should be incorporated into 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.
(3) Acquisition of subsidiary minority interests
The difference between the investment cost of the long-term equity obtained from acquisition of minority interests
and the share of net assets in the subsidiary calculated continuously based on the increased shareholding
percentage, and the difference between the disposal income obtained from the partial disposal of the subsidiary’s
equity investment without losing the control power and the share of net assets in the subsidiary calculated
continuously based on the increased shareholding percentage should be adjusted and consolidated in the capital
surplus in the consolidated balance sheet. Where the capital surplus falls short, the retained income should be
adjusted.
(4) Treatment of loss of subsidiaries’ control power
For loss of control over subsidiaries due to disposal of partial equity investment or other reasons, the remaining
equity should be re-measured at the fair value on the date of loss of the control power; the sum of the
consideration obtained from the disposal of stock equity and the fair value of the remaining equity, minus the sum
of the share of the net assets’ book value calculated continuously from the acquisition date according to the
original shareholding percentage and the goodwill should be recorded in the investment gain of the current period
of the loss of control power.
Other misc. incomes related to the equity investment in the original subsidiary is transferred to the current
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China Fangda Group Co., Ltd. 2015 Annual Report
period’s profit and loss when the control power is lost, except for the other misc. incomes generated by
re-measurement and resetting of earning plan or change in the net assets by the invested party.
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
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
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China Fangda Group Co., Ltd. 2015 Annual Report
Financial assets of the Group are categorized as: financial assets measured at fair value with variations accounted
into current income account, loans 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.
(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 III. 10 for the recognition of 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 Group.
Objective evidence proving impairment to the financial assets includes the following observable situations:
Severe financial difficulties in the issuer or debtor;
② The debtor violates the contract or defaults or delays the payment of the interest or principal;
③ The Group makes compromise to the debtor with financial difficulties due to economic or legal consideration;
④ The debtor may go bankruptcy or conduct other financial reorganization;
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China Fangda Group Co., Ltd. 2015 Annual Report
⑤ The financial assets can no longer be traded in an active market due to material financial difficulties in the
issuer;
⑥ It cannot be recognized whether the cash flow of an asset in a group of financial assets has decreased.
However, according to open data, it can be evaluated that the estimated future cash flow of the group of financial
assets has decreased and the decrease can be measured, including:
- The payment capacity of the debtor of the financial assets continues weakening;
- Situations that may lead to the payment failure of the financial assets happen in the country or region where
the debtor is located;
⑦ Significant adverse changes occurs to the technical, market, economic or legal environment of the debtor,
leading to that the equity instrument investor may not be able to recover the investment;
⑧ Other objective evidence that can prove the impairment of the 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 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.
(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
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China Fangda Group Co., Ltd. 2015 Annual Report
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 Company is involving in
the financial asset.
(7) Deduction of financial assets and liabilities
When the Group has the legal right to deduct recognized financial assets and liabilities, can exercise the legal right,
and the Group plans to settle them in net, liquidate and repay the financial assets and liabilities, the amount after
the deduction will be presented in the balance sheet. Exception for the deducted part, other financial assets and
liabilities are separately presented in the balance sheet.
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
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
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China Fangda Group Co., Ltd. 2015 Annual Report
□ Applicable √ Inapplicable
(3) Receivables with not major 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 Company’s inventories include purchased materials, raw materials, low-value consumables, OEM materials,
products in process, semi-finished goods, finished goods, inventory, development products, and construction in
process.
(2) Pricing of delivering 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.
The development costs 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
The realizable net value of inventory is the estimated sales prices of the inventory less costs to be incurred until
the completion, estimated sales expense and taxes. The realizable net value of inventory should be recognized
based on solid evidence with the purpose of the inventory and after-balance-sheet-date events taken into
consideration.
If the inventory cost is higher than the realizable net value on the balance sheet date, the inventory depreciation
provision should be made. The Group makes inventory depreciation provision for separate or a type of inventory.
If factors affecting the inventory value disappear on the balance sheet date, the depreciation provision made
should be reversed to the original value.
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China Fangda Group Co., Ltd. 2015 Annual Report
(4) Inventory system
The Group uses perpetual inventory system.
(5) Amortizing of low-value consumables and packaging materials
Low-value consumables are amortized on on-off amortization basis at using.
12. Long-term share equity investment
The Group's long-term equity investment includes control on invested entities and significant impacts on equity
investment. Invested entities on which the Group has significant impacts are associates of the Group.
(1) Recognition of initial investment costs
Long-term equity investment generated by enterprise merger: for long-term equity investment obtained by merger
of enterprises under common control, the obtained share of book value of the interests of the merged party’s
owner in the consolidate financial statements on the merger date is the investment costs; for long-term equity
investment obtained by merger of enterprises not under common control, the merger cost is the investment cost.
For long-term equity investment obtained by cash, the actually paid consideration is the initial investment cost.
(2) Subsequent measurement and recognition of gain/loss
Investments by the Company in subsidiaries are calculated using the cost method; in joint ventures are calculated
using the equity method.
For the long-term equity investment measured on the cost basis, except for the announced cash dividend or profit
included in the practical cost or price when the investment was made, the cash dividends or profit distributed by
the invested entity are recognized as investment gains in the current gain/loss account.
When the equity method is used to measure long-term equity investment, the investment cost will not be adjusted
if the investment cost of the long-term equity investment is larger than the share of fair value of the recognizable
assets of the invested entity. When it is smaller than the share of fair value of the recognizable assets of the
invested entity, the book value will be adjusted and the difference is included in the current gains of the
investment.
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, recognized as investment gain and other misc. income. The book value of the
long-term equity investment is adjusted accordingly. The book value of the long-term equity investment should be
accordingly decreased based on the share of profit or cash dividend announced by the invested entity; according to
other changes in the owner’s equity except for net profit and loss, other misc income and profit distribution of the
invested entity, adjust the book value of the long-term equity investment and record it in the capital surplus (other
capital surplus). When the share of the net gains that can be enjoyed is recognized, it is recognized after the net
profit of the invested entity is adjusted based on the fair value of the recognizable assets of the invested entity
according to the Company's accounting policies and accounting period.
Where substantial influence on invested entities is imposed or joint control is implemented due to increase in
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China Fangda Group Co., Ltd. 2015 Annual Report
investment, the sum of the fair value of the original equity and increased investment on the conversion date is the
initial investment cost under the equity method. The difference between the fair value and book value of the
original equity on the conversion date and the accumulative change in the fair value originally accounted in other
misc. income should be transferred into the profit and loss of the current period using the equity method.
Where joint control or substantial influence on invested entities is lost due to disposal of part of investment, the
remaining equity after the disposal should be treated according to the Enterprise Accounting Standard No.22 –
Recognition and Measurement of Financial Instruments from the date of losing the joint control or substantial
influence. The difference between the fair value and book value should be accounted the profit and loss of the
current period. For other misc. income recognized due to the calculation of original equity investment using the
equity method, when the equity method is no longer used, the accounting treatment should be based on the same
principle of disposing related assets or liabilities of the invested entity. Other owner’s interests related to the
original investment should be transferred to the profit and loss of this period.
Where the disposal of part of the equity investment leads to loss of control on the invested entity, and the
remaining equity after the disposal can impose common control or significant impacts on the invested entity, use
the equity method and make adjustment as if the equity method was used when the remaining equity was acquired.
If not, perform accounting treatment according to provisions in the Enterprise Accounting Standard No.22 –
Recognition and Measurement of Financial Tools. The difference between the fair value and book value on the
date of losing control should be transferred into the profit and loss of this period.
Where the Company’s shareholding decreases and the Company loses the control due to increased investment by
another investor, but the Company can still impose common control or significant impacts on the invested entity,
the share of increased net assets of the invested entity that can be shared by the Company should be calculated
based on the new shareholding, the difference between the net assets and original book value of the original
long-term equity investment should be recorded in the profit and loss of this period and adjusted as if equity
method was when it was acquired according to the new shareholding proportion.
Internal transaction gain not realized between the Company and affiliates is measured according to the
shareholding proportion and the investment gains is recognized after deduction. The unrealized internal
transaction loss between the Company and the invested entity is the impairment loss of transferred assets and
should not be written off.
(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 considering whether the
Company can impose significant impacts on the invested entity, impacts of conversion of shares with voting rights
held directly or indirectly by the investor and voting rights that can be executed in this period held by the investor
and other party into shares of the invested entity should be considered.
When Company directly or indirectly holds 20% (inclusive) but less than 50% of the shares with voting rights of
the invested entity, it is generally considered that the Company can impose significant impacts unless there is
clear evidence proving that the Company shall not participate in the production and business decision making of
the company; when the Company holds less than 20% of the shares with voting rights, it is generally not
considered that the Company has significant impacts on the invested entity, unless there is clear evidence proving
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China Fangda Group Co., Ltd. 2015 Annual Report
the contrary.
(4) Impairment examination and providing of impairment provision
See Note V. 18 for the assets impairment provision method for investment in subsidiaries and joint ventures.
13. Investment real estate
Measuring mode of investment real estate
Measurement at fair value
Basis of choosing the measurement at fair value
Investment real estates of the Group are buildings leased.
For investment real estates with an active real estate transaction market and the Group can obtain market price and
other information of same or similar real estates to reasonably estimate the investment real estates’ fair value, the
Group will use the fair value mode to measure the investment real estates subsequently. Variations in fair value
are accounted into the current gain/loss account.
The fair value of investment real estates 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 estates with book
value and related taxes deducted is accounted into the current gain/loss account.
See Note V. 18 for the assets impairment provision method for the investment real estates that are subsequently
measured using the cost model.
14. 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
Type Depreciation method Service year Residual rate Annual depreciation
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China Fangda Group Co., Ltd. 2015 Annual Report
rate %
Houses & buildings Average age 35-45 10 2-2.57
Mechanical equipment Average age 10 10 9
Transportation facilities Average age 5 10 18
Electronics and other
Average age 5 10 18
devices
PV power plants Average age 20 5 4.75
The Group adopts the straight age average basis to make depreciation provision. The Company will start to make
the depreciation provision when the fixed assets reach the preset serviceable condition and stop to make the
depreciation provision when it is derecognized or categorized as non-current assets held for sales. Without
considering depreciation provision, the Group determines annual depreciation rates for various fixed assets
according to types, predicted service life and residual value:
For fixed assets for which depreciation provision is made, the depreciation rate will be determined after the
accumulative depreciation provision amount is deducted.
(3) See Note V. 18 for the depreciation testing and provision method for fixed assets.
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(4) At end of each fiscal year, verification will be made on the useful life, predicted retained value, and
depreciation basis.
The useful life will be adjusted if the useful life is different from the predicted one; the net residual value will be
adjusted if the net residual value is different from the predicted one.
(5) Overhaul cost
Overhaul cost generated by regular examination on fixed assets is recognized as fixed assets costs when there is
evidence proving that it meets fix assets recognition conditions. If not, it will be accounted into the current
gain/loss account. Depreciation provision will be made for fixed assets between two regular overhauls.
15. 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. 18 for the provision method for construction in process.
16. 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.
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(3) Calculation of the capitalization amount of borrowing expense
Interest expenses generated by special borrowings less the interests income obtained from the deposit of unused
borrowings or investment gains from temporary investment is capitalized; the capitalization amount for general
borrowing is determined based on the capitalization rate which is the exceeding part of the accumulative assets
expense over weighted average of the assets expense of the special borrowing/used general borrowing. The
capitalization ratio is the weighted average interest rate of general borrowings.
In the capitalization period, the exchange difference of special borrowings in foreign currencies should be fully
capitalized. The exchange difference should be recorded in the profit and loss of this period.
17. Intangible assets
(1) Pricing method, service life and depreciation test
The Group’s intangible assets include land using rights, trademarks, patent, special 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
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 Group,
transfer all the intangible assets’ book value into the current gain/loss account.
See Note V. 18 for the impairment provision method for intangible assets.
(2) Accounting policies for internal R&D expenses
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.
18. 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 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.
Once recognized, the asset impairment loss cannot be written back in subsequent accounting period.
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19. 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.
20. Staff remuneration
(1) Accounting of short-term remuneration
Staff remuneration is the compensation paid by the employer to the staff for the services they provide or for
termination of the working relationship. Staff remuneration includes short-term remuneration and
post-employment welfare.
The Group pays for the medical insurance, job injury insurance and breeding insurance and housing fund
according to employees’ wages and bonus and recognizes them as liabilities, which are recorded into the profit
and loss or related assets costs in the current period. If the liabilities cannot be fully paid within 12 months upon
the end of the report period in which the employees provide service, and the financial impacts are substantial, the
liabilities should be measured at the discounted amount.
(2) Accounting of post-employment welfare
The post-employment welfare of the Group is a defined plan, which means that the Company does not need to
assume any responsibility after making fixed contribution to an independent fund. The defined plan includes basic
pension and unemployment insurance. The contribution of the plan is recognized as liabilities and recorded in the
profit and loss of this period or related assets costs.
(3) Accounting of dismiss welfare
Where the Group provides dismiss welfare for employees, the staff remuneration liabilities is recognized on the
earlier one of the following two date: when the Group cannot cancel the dismiss welfare provided for termination
of employment or layoff; when the Group recognizes the costs or expenses of reorganization related to the
payment of dismiss welfare.
21. 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.
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Expected liabilities are initially measured at the best estimation on the expenses to exercise the current
responsibility. The book value of expected liability is revised at balance sheet day, and adjustment will be made to
reflect current best estimation.
22. 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
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.
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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.
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.
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.
23. Government subsidy
(1) Judgment basis and accounting treatment of assets-related government subsidy
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 them,
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.
If a recognized government subsidy needs to be returned, if there are relative differed gains, the balance of
differed gains will be set off, the exceeded part shall be recorded into current income account; if there is no
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relative differed gain, record to current income account directly.
(2) Judgment basis and accounting treatment of return-related government subsidy
Government subsidies in connection with gains, which are used to cover current expenses or losses, are
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 set off, the exceeded part shall be recorded into current income account; if there is no
relative differed gain, record to current income account directly.
24. 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, joint ventures 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, joint ventures 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.
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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.
25. Leasing
(1) Accounting of operational leasing
(1) The Group is the leasor
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.
(1) The Group is the leasee
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 Group transfers all the risks and rewards attached to the asset at substantially transferred to the lessee, it is
recognized as financial leasing, and the others are operational leasing.
(1) The Group is the leasor
In financial 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.
(1) The Group is the leasee
The Group 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 Group adopts the depreciation policy same as the self-owned fixed assets to
made provision for depreciation of leased assets.
26. Other significant accounting policies and estimates
Accounting of hedging
Significant accounting judgment and estimate
The Group continuously reviews significant accounting judgment and estimate adopted for the reasonable forecast
of future events based on its historical experience and other factors.
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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 Group 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 Group 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 Group 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
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 the income according to the completion percentage of each construction contract. The
management estimates the completion percentage according to the actual costs in the total budget. Given the
nature of activities in construction contracts, activity and completion dates are usually in different accounting
periods. The Group will revise the estimated contract incomes and costs (if the actual contract income is smaller
than the actual cost, impairment loss provision will be made).
27. Major changes in accounting policies and estimates
(1) Changes in accounting policies
□ Applicable √ Inapplicable
(2) Changes in major accounting estimates
□ Applicable √ Inapplicable
VI. Taxation
1. Major taxes and tax rates
Tax Tax basis Tax rate
VAT Taxable income 6%、13%、17%
Business tax Taxable turnover 3%、5%
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City maintenance and construction tax Taxable turnover 1%、5%、7%
Enterprise income tax Taxable income 15%、25%
Education surtax 3%
Tax rates applicable for different tax payers
Tax payer Income tax rate
The Company 25%
Shenzhen Fangda Jianke Group Co., Ltd. 15%
Shenzhen Fangda Automation System Co., Ltd. 15%
Shenzhen Woke Semi-conductor Lighting Co., Ltd. 25%
Fangda New Materials (Jiangxi) Co., Ltd. 15%
Jiangxi Fangda New Type Aluminum Co., Ltd. 25%
Shenyang Fangda Semi-conductor Lighting Co., Ltd. 25%
Dongguan Fangda New Material Co., Ltd. 25%
Shenzhen Kexunda Software Co., Ltd. 25%
Chengda Fangda Construction Technology Co., Ltd. 15%
Fangda Decoration Engineering (Shenyang) Co., Ltd. 25%
Shenzhen Fangda Property Development Co., Ltd. 25%
Shenzhen Fangda New Energy Co., Ltd. 25%
Guangdong Fangda SOZN Lighting Co., Ltd. 25%
Shenzhen Fangda Property Management Co., Ltd. 25%
Shenzhen Qianhai Kechuangyuan Software Co., Ltd. 15%
Jiangxi Fangda Property Development Co., Ltd. 25%
Ganzhou Longneng New Energy Co., Ltd. 25%
Pingxiang Fangda Luxin New Energy Co., Ltd. 25%
Pingxiang Xiangdong Fangda New Energy Co., Ltd. 25%
Nanchang Xinjian Fangda New Energy Co., Ltd. 25%
Dongguan Fangda New Energy Co., Ltd. 25%
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 19.06.15, Fangda Jianke was entitled to enjoy a tax preference of enterprise income tax of 15% for three years
(2015-2017) 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
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China Fangda Group Co., Ltd. 2015 Annual Report
on 19.06.15, Fangda Decoration was entitled to enjoy a tax preference of enterprise income tax of 15% for three
years (2015-2017) 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 25.09.15, Fangda
New Material was entitled to enjoy a tax preference of enterprise income tax of 15% for three years (2015-2017)
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. Kexunda entered the semi-exemption period in 2015.
(5) On November 7, 2014, Chengdu Fangda was certified by Sichuan Xinjin National Tax Bureau as an encourage
industry company in the west China (Xin Jin National Tax Doc. [zzy024]) and started to enjoy a tax rate of 15%.
(6) On November 2, 2015, Dongguan New Energy was certified by Dongguan National Tax Bureau Songshanhu
branch as the national supported public infrastructure project according to the Song Shan Hu Tax Doc [2015]
3305. The company is exempted from enterprise income tax for three years and halfly exempted for another three
years. In 2015, the company entered the exemption period.
(7) According the Notice of Providing Guangdong Hengqing New District, Fujian Pingtan Pilot
Zone and Shenzhen Qianhai Shenzhen-Hong Kong Modern Service Cooperation Zone with Tax
Preference Policies, Kechuangyuan Software enjoys an income tax rate of 15%.
VII. Notes to the consolidated financial statements
1. Monetary capital
In RMB
Items Closing balance Opening balance
Inventory cash 28,072.46 40,733.33
Bank deposits 266,315,876.39 114,515,874.25
Other monetary capital 134,609,388.47 97,874,191.29
Total 400,953,337.32 212,430,798.87
Including: total amount deposited in
5,722,165.37 2,370,695.75
overseas
(3) Others
(1) The balance of the bank deposit at the end of the period includes the bank deposit of RMB23 million of
Fangda Jianke frozen by the court (see Note XIII.1 for details) and the bank deposit of RMB538,264.14 of Fangda
SOZN.
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China Fangda Group Co., Ltd. 2015 Annual Report
(2) The closing balance of the book value of the other monetary capital is mainly the futures, bank acceptance bill
and guarantee deposit and investment, including a deposit of RMB129,675,829.40. The deposit and frozen deposit
shall not be treated as cash and cash equivalent in the preparation of cash flow statements.
(3) The closing monetary capital increased by 88.75% from the beginning of the year. It is mainly due to that no
more bank financial products were purchased at the end of the year.
2. Financial assets measured at fair value with variations accounted into current income account
In RMB
Items Closing balance Opening balance
Transactional financial assets 14,546,206.58 13,410,790.00
Investment in equity tools 14,546,206.58 13,410,790.00
Total 14,546,206.58 13,410,790.00
Others:
The closing balance is the fair value of the shares of SINO OIL & GAS acquired by Shihui International Holding
Co., Ltd.
3. Derivative financial assets
□ Applicable √ Inapplicable
4. Notes receivable
(1) Classification of notes receivable
In RMB
Items Closing balance Opening balance
Bank acceptance 10,289,884.74 2,697,145.86
Commercial acceptance 86,957,775.82 80,628,579.84
Total 97,247,660.56 83,325,725.70
(2) The Group has no endorsed or discounted immature receivable notes at the end of the period.
In RMB
Items De-recognized amount Not de-recognized amount
Bank acceptance 104,701,283.62
Commercial acceptance 1,056,126.00 4,957,775.82
Total 105,757,409.62 4,957,775.82
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China Fangda Group Co., Ltd. 2015 Annual Report
(3) Notes transferred to accounts receivable due to default of the issue at the end of period
In RMB
Amount transferred to accounts receivable at the end of the
Items
period
Commercial acceptance 19,846,579.84
Total 19,846,579.84
5. Account receivable
(1) Account receivable disclosed by categories
In RMB
Closing balance Opening balance
Remaining book Remaining book
Bad debt provision Bad debt provision
Type value Book value
Book value
Proportio Provision value Proportio Provision
Amount Amount Amount Amount
n rate n rate
Recognition and 1,280,5
1,611,97 206,824, 1,405,151 175,879,7 1,104,625,2
providing of bad debt 99.41% 12.83% 04,982. 98.68% 13.74%
5,331.93 197.04 ,134.89 31.45 51.46
provisions on groups 91
Account receivable
with minor individual
9,541,65 8,974,65 567,000.0 17,154, 16,537,28
amount and bad debt 0.59% 94.06% 1.32% 96.40% 617,000.00
5.45 5.45 0 285.41 5.41
provision provided
individually
1,297,6
1,621,51 215,798, 1,405,718 192,417,0 1,105,242,2
Total 100.00% 13.31% 59,268. 100.00% 14.83%
6,987.38 852.49 ,134.89 16.86 51.46
32
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
Account receivable Bad debt provision Provision rate
Sub-item of within 1 year
Subtotal for less than 1 year 988,440,956.29 29,353,228.69 2.98%
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China Fangda Group Co., Ltd. 2015 Annual Report
1-2 years 252,343,963.99 25,321,425.23 10.00%
2-3 years 167,228,313.66 50,168,494.10 30.00 %
Over 3 years 203,962,097.99 101,981,049.02 50.00 %
Total 1,611,975,331.93 206,824,197.04 12.83%
Group recognition basis:
Account receivable adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
Account receivable adopting other methods in the group:
(2) Bad debt provision made, returned or recovered in the period
A bad debt provision of RMB34,811,396.51 was made in the period. RMB0.00 was recovered or reversed.
(3) Written-off account receivable during the period
In RMB
Items Amount
Account receivable written off 11,429,560.88
Including significant account receivable:
In RMB
Writing-off
Entity Nature Amount Reason Related transaction
procedure
Guodu Real Estate
Engineering
Development 803,340.45 Unrecoverable Management No
payment
(Shenzhen) Co., Ltd.
Shenzhen Zaoyunda Engineering
660,625.41 Unrecoverable Management No
Machinery Co., Ltd. payment
Total -- 1,463,965.86 -- -- --
(4) Balance of top 5 accounts receivable at the end of the period
The total balance of top-five accounts receivable at the end of the period is RMB209,543,439.19, accounting for
12.92% of the total remaining balance of all accounts receivable. The bad debt provision made at the end of the
period is RMB6,766,281.58.
6. Prepayment
(1) Account age of prepayments
In RMB
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China Fangda Group Co., Ltd. 2015 Annual Report
Closing balance Opening balance
Age
Amount Proportion Amount Proportion
Less than 1 year 23,448,649.55 73.89% 24,526,989.72 83.90%
1-2 years 3,490,224.16 12.05% 2,991,743.88 10.23%
2-3 years 1,418,149.13 5.15% 163,672.10 0.56%
Over 3 years 1,700,041.06 8.91% 1,551,825.79 5.31%
Total 30,057,063.90 -- 29,234,231.49 --
(2) Balance of top 5 prepayments at the end of the period
The total balance of top-five prepayments at the end of the period is RMB11,614,739.09, accounting for 36.60%
of the total remaining balance of all accounts receivable. The bad debt provision made at the end of the period is
RMB587,828.51.
7. Other receivables
(1) Other receivables disclosed by categories
In RMB
Closing balance Opening balance
Remaining book Remaining book
Bad debt provision Bad debt provision
Type value Book value
Book value
Proportio Provision value Proportio Provision
Amount Amount Amount Amount
n rate n rate
Recognition and
65,503,5 12,407,6 53,095,94 62,085, 13,134,50 48,950,647.
providing of bad debt 99.78% 18.94% 99.64% 21.16%
87.52 39.06 8.46 155.66 7.99 67
provisions on groups
Other receivables
with minor individual
146,100. 146,100. 223,146 223,146.9
amount and bad debt 0.22% 100.00% 0.00 0.36% 100.00% 0.00
95 95 .95 5
provision provided
individually
65,649,6 12,553,7 53,095,94 62,308, 13,357,65 48,950,647.
Total 100.00% 19.12% 100.00% 21.44%
88.47 40.01 8.46 302.61 4.94 67
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
114
China Fangda Group Co., Ltd. 2015 Annual Report
Closing balance
Age
Other receivables Bad debt provision Provision rate
Sub-item of within 1 year
Subtotal for less than 1 year 35,506,425.19 1,063,824.56 3.00%
1-2 years 6,535,574.83 653,557.50 10.00%
2-3 years 5,202,683.55 1,560,805.07 30.00%
Over 3 years 18,258,903.95 9,129,451.93 50.00%
Total 65,503,587.52 12,407,639.06 18.94%
Group recognition basis:
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 provision made, returned or recovered in the period
A bad debt provision of RMB-722,264.33 was made in the period. RMB0.00 was recovered or reversed.
(3) Other receivable written off in the current period
In RMB
Items Amount
Other receivable written off 81,650.60
(4) Other receivables are disclosed by nature
In RMB
By nature Closing balance of book value Opening balance of book value
Deposit 36,529,862.27 37,088,745.12
Construction borrowing and advanced
17,242,358.04 14,869,519.46
payment
House disposal receivable 2,136,200.00
Staff borrowing and petty cash 3,062,219.75 1,410,387.87
Receivable refund of VAT 80,888.90 576,297.37
Others 8,734,359.51 6,227,152.79
Total 65,649,688.47 62,308,302.61
115
China Fangda Group Co., Ltd. 2015 Annual Report
(5) Balance of top 5 other receivables at the end of the period
In RMB
Percentage in the Balance of bad debt
Entity By nature Closing balance Age closing balance of provision at the end
other receivables(%) of the period
Advanced
Wang Weihong 695.00 1-2 years 0.00% 69.50
construction fee
Advanced
Wang Weihong 352,178.17 2-3 years 0.54% 105,653.45
construction fee
Advanced
Wang Weihong 4,591,514.98 Over 3 years 6.99% 2,295,757.49
construction fee
Advanced
Xin Song 2,620,327.61 Over 3 years 3.99% 1,310,163.81
construction fee
Advanced
Zeng Liang 2,360,324.74 Less than 1 year 3.60% 70,809.74
construction fee
Hainan GreenTown
Deposit 1,746,000.00 2-3 years 2.66% 523,800.00
Investment Co., Ltd.
Cixi Fanshi Property
Development Co., Deposit 1,222,473.75 Over 3 years 1.86% 611,236.88
Ltd.
Total -- 12,893,514.25 -- 19.64% 4,917,490.87
8. Inventories
(1) Classification of inventories
In RMB
Closing balance Opening balance
Items Remaining book Depreciation Remaining book Depreciation
Book value Book value
value provision value provision
Raw materials 85,916,458.16 7,069,471.61 78,846,986.55 101,814,705.80 2,551,138.82 99,263,566.98
Product in
6,971,619.92 6,971,619.92 6,682,625.91 2,277.73 6,680,348.18
process
Finished goods in
18,325,455.59 5,513,219.11 12,812,236.48 22,999,746.67 2,470,651.68 20,529,094.99
stock
Assets unsettled
for finished
226,526,505.83 1,830,742.67 224,695,763.16 251,262,257.58 1,830,742.67 249,431,514.91
construction
contracts
116
China Fangda Group Co., Ltd. 2015 Annual Report
Low price
69,223.68 69,223.68 59,672.66 59,672.66
consumable
OEM materials 8,791,959.78 1,218,716.77 7,573,243.01 3,358,174.63 3,358,174.63
Development cost 986,708,925.20 986,708,925.20 603,118,814.70 603,118,814.70
Goods delivered 28,913,305.53 28,913,305.53
Total 1,362,223,453.69 15,632,150.16 1,346,591,303.53 989,295,997.95 6,854,810.90 982,441,187.05
(2) Inventory depreciation provision
In RMB
Increase in this period Decrease in this period
Items Opening balance Recover or Closing balance
Provision Others Others
write-off
Raw materials 2,551,138.82 4,623,290.48 104,957.69 7,069,471.61
Product in
2,277.73 2,277.73
process
Finished goods in
2,470,651.68 3,143,105.85 100,538.42 5,513,219.11
stock
Assets unsettled
for finished
1,830,742.67 1,830,742.67
construction
contracts
OEM materials 1,218,716.77 1,218,716.77
Total 6,854,810.90 8,985,113.10 207,773.84 15,632,150.16
(3) Balance at the end of the period includes capitalization of borrowing expense
The balance at the end of the period includes capitalization of borrowing expense of RMB44,371,221.40.
(4) Assets unsettled for finished construction contracts at the end of the period
In RMB
Items Amount
Accumulative occurred costs 5,458,293,985.56
Accumulative recognized gross margin 923,989,118.87
Less: estimated loss 1,830,742.67
Settled amount 6,155,756,598.60
Assets unsettled for finished construction contracts 224,695,763.16
Others:
117
China Fangda Group Co., Ltd. 2015 Annual Report
(5) Development cost
Project Starting Estimated Estimated Closing Opening Closing
time finish time total amount amount depreciation
investment provision
Fangda May. 2014 December RMB2,421,911, 886,932,360.20 603,118,814.70
Town 2016 100
Jiangxi 99,776,565.00
Property
project
Total 986,708,925.20 603,118,814.70
9. Other current assets
In RMB
Items Closing balance Opening balance
Input tax to be deducted 11,083,687.96 6,986,107.72
Bank financial products 228,000,000.00
Prepaid income tax 312,030.09
Total 11,395,718.05 234,986,107.72
Others:
10. Long-term share equity investment
In RMB
Change (+,-) Balance
Investme of
Other
nt gain Cash impairme
Decrease miscellan
Invested Opening Increased and loss Other dividend Impairme Closing nt
d eous
entity balance investmen recognize equity or profit nt Others balance provision
investmen income
t d using change announce provision at the end
t adjustmen
the equity d of the
t
method period
1. Joint venture
2. Associate
Shenzhen
Ganshang
Joint 11,048,66 -337,462. 2,200,000 8,511,197
Investme 0.43 45 .00 .98
nt Co.,
Ltd.
118
China Fangda Group Co., Ltd. 2015 Annual Report
Shenzhen
Huihai
Yirong 2,000,000 -21,517.0 1,978,482
Internet .00 5 .95
Service
Co., Ltd.
11,048,66 2,000,000 -358,979. 2,200,000 10,489,68
Subtotal
0.43 .00 50 .00 0.93
11,048,66 2,000,000 -358,979. 2,200,000 10,489,68
Total
0.43 .00 50 .00 0.93
Others:
Note: A new associate Shenzhen Huihai Yirong Internet Service Co., Ltd. was increased this year.
The Company contributed RMB2 million, holds 10% in its stake and designated a director in its
board of directors.
Investment real estate
(1) Investment real estate measured at costs
√ Applicable □ Inapplicable
In RMB
Items Houses & buildings Land using right Construction in process Total
I. Book value
1. Opening balance 32,081,268.14 32,081,268.14
2. Increase in this
period
(1) External
purchase
(2) Transfer-in from
inventory\fixed
5,095,047.32 5,095,047.32
assets\construction in
progress
(3) Increase due to
enterprise merger
3. Decrease in this
period
(1) Purchase
(2) Other
transfer-out
119
China Fangda Group Co., Ltd. 2015 Annual Report
4. Closing balance 37,176,315.46 37,176,315.46
II. Accumulative
depreciation and
amortization
1. Opening balance 4,315,330.90 4,315,330.90
2. Increase in this
2,147,391.35 2,147,391.35
period
(1) Provision or
888,212.55 888,212.55
amortization
(2) Other
1,259,178.80 1,259,178.80
increases
3. Decrease in this
period
(1) Purchase
Other transfer-out
4. Closing balance 6,462,722.25 6,462,722.25
III. Impairment provision
1. Opening balance
2. Increase in this
period
(1) Provision
3. Decrease in this
period
(1) Purchase
Other transfer-out
4. Closing balance
IV. Book value
1. Closing book
30,713,593.21 30,713,593.21
value
2. Opening book
27,765,937.24 27,765,937.24
value
120
China Fangda Group Co., Ltd. 2015 Annual Report
(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 198,513,586.15 198,513,586.15
II. Change in this period
Add: external
purchase
Transfer-in
from inventory\fixed
20,307,845.89 20,307,845.89
assets\construction in
progress
Increase due to
enterprise merger
Less: disposal
Other
transfer-out
Change in fair value 85,793,780.49 85,793,780.49
III. Closing balance 304,615,212.53 304,615,212.53
(3) Investment real estate without ownership certificate
In RMB
Items Book value Reason
Houses in Dalian of Fangda Jianke for
9,306,570.00 Applying for
offsetting debt
(3) Others
The fair value of the investment real estate is determined based on 深同诚评字(2,016A)01YQC 第
025 号 Real Estate Valuation Report issued by TOUCHSTONE.
12. Fixed assets
(1) Fixed assets
In RMB
121
China Fangda Group Co., Ltd. 2015 Annual Report
Houses & Mechanical Transport Electronics and
Items PV power plants Total
buildings equipment equipment other devices
I. Original book
value:
1. Opening
414,676,207.19 244,520,117.16 23,352,273.72 55,787,441.33 738,336,039.40
balance
2. Increase in
44,302.29 11,976,788.22 7,798,151.92 639,637.24 6,456,437.81 26,915,317.48
this period
(1) Purchase 30,000.00 7,798,151.92 639,637.24 6,456,437.81 14,924,226.97
(2)
Transfer-in of
14,302.29 11,976,788.22 11,991,090.51
construction in
progress
(3) Increase
due to enterprise
merger
3. Decrease in
28,872,867.11 4,981,945.53 532,448.20 34,387,260.88
this period
(1) Disposal
4,981,945.53 532,448.20 5,514,393.77
or retirement
(2) Other
28,872,867.11 28,872,867.11
decrease
4. Closing
385,847,642.37 11,976,788.22 247,336,323.55 23,991,910.96 61,711,430.90 730,864,096.00
balance
II. Accumulative
depreciation
1. Opening
38,473,077.25 159,921,185.98 10,047,751.18 23,247,074.02 231,689,088.43
balance
2. Increase in
10,785,178.07 142,224.36 8,968,629.26 2,694,364.56 6,188,860.87 28,779,257.12
this period
(1) Provision 10,785,178.07 142,224.36 8,968,629.26 2,694,364.56 6,188,860.87 28,779,257.12
3. Decrease in
4,729,152.70 4,066,991.78 389,369.92 9,185,514.40
this period
(1) Disposal
4,066,991.78 389,369.92 4,456,361.70
or retirement
(2) Other 4,729,152.70 4,729,152.70
122
China Fangda Group Co., Ltd. 2015 Annual Report
decrease
4. Closing
44,529,102.62 142,224.36 164,822,823.46 12,742,115.74 29,046,564.97 251,282,831.15
balance
III. Impairment
provision
1. Opening
277,744.50 16,654,521.84 16,932,266.34
balance
2. Increase in
this period
(1) Provision
3. Decrease in
this period
(1) Disposal
or retirement
4. Closing
277,744.50 16,654,521.84 16,932,266.34
balance
IV. Book value
1. Closing
341,040,795.25 11,834,563.86 65,858,978.25 11,249,795.22 32,664,865.93 462,648,998.51
book value
2. Opening
375,925,385.44 67,944,409.34 13,304,522.54 32,540,367.31 489,714,684.63
book value
(2) Temporary idle fixed assets
In RMB
Accumulative Impairment
Items Book value Book value Notes
depreciation provision
Houses & buildings 46,833,628.81 6,428,790.74 277,744.50 40,127,093.57
Mechanical
105,591,939.34 70,551,467.09 15,300,132.34 19,740,339.91
equipment
Transportation
358,087.84 336,344.98 21,742.86
facilities
Electronics and other
7,822,284.94 7,591,621.38 230,663.56
devices
Total 160,605,940.93 84,908,224.19 15,577,876.84 60,119,839.90
123
China Fangda Group Co., Ltd. 2015 Annual Report
(3) Fixed assets without ownership certificate
In RMB
Items Book value Reason
Houses in Urumuqi for offsetting debt 566,436.05 Applying for
Yuehai Office Building C 502 154,944.66 Historical reasons
Houses in Dalian of Fangda Jianke for
5,013,253.78 Applying for
offsetting debt
Shenyang Fangda extension workshop 17,093,244.13 Entering into liquidation
Shenyang Fangda dorm and workshop 2# 7,919,804.71 Entering into liquidation
Dining hall and power station of Shenyang
3,804,945.60 Entering into liquidation
Fangda
(3) Others
On December 31, 2015, the original value of house and buildings of the Group of RMB58,834,355.09 with an
accumulative depreciation of RMB5,883,107.64 and a net value of RMB52,951,247.45 was pledged to China
Construction Bank Shenzhen OCT Branch.
By December 31, 2015, the original value of equipment of RMB19,890,185.65, with an accumulative depreciation
of RMB834,314.60 and a net value of RMB19,055,871.05 was frozen by the court due to the sales contract
lawsuit of Fangda SOZN.
Other decreases in the fixed assets are part of plants in Jiangxi Nanchang Fangda High-Tech Park and pledged houses in Dalian,
Chongqing and Ningbo, which were transferred from self-use to leases, from fixed assets to investment real estate.
13. Construction in process
(1) Construction in progress
In RMB
Closing balance Opening balance
Items Remaining book Impairment Remaining book Impairment
Book value Book value
value provision value provision
Xinjin energy
saving
environmental 816,356.71 816,356.71 341,749.17 341,749.17
protection curtain
wall project
Xuanfeng
20MWp PV
10,257,959.91 10,257,959.91
power plant
project
Xiabu 20MWp 1,657,715.18 1,657,715.18
124
China Fangda Group Co., Ltd. 2015 Annual Report
PV power plant
project
Isuzu part place
PV power plant 1,093,343.24 1,093,343.24
project
Engineering
project
761,792.44 761,792.44
management
platform
Dongguan
Songshanhu
531,689.44 531,689.44
showroom No.1
display
Shangbu 18MWp
PV power plant 15,533.98 15,533.98
project
Total 15,134,390.90 15,134,390.90 341,749.17 341,749.17
(2) Changes in major construction in process in this period
In RMB
Proporti
Includin
Amount on of
g:
transfer-i accumul Accumul
Other capitaliz
Increase n to ative ative Interest
Opening decrease Closing Project ed Capital
Project Budget in this fixed engineeri capitaliz capitaliz
balance in this balance progress interest source
period assets in ng ed ation rate
period for the
this investme interest
current
period nt in the
period
budget
Xuanfen
g
Equipme
20MWp
93,103,1 10,257,9 10,257,9 nt
PV 11.02% Others
00.00 59.91 59.91 installati
power
on
plant
project
Fangda
Songsha
13,162,4 11,976,7 11,976,7 Complet
nhu 90.99% Others
00.00 88.22 88.22 ed
industria
l part
125
China Fangda Group Co., Ltd. 2015 Annual Report
106,265, 22,234,7 11,976,7 10,257,9
Total -- -- --
500.00 48.13 88.22 59.91
14. Disposal of fixed assets
In RMB
Items Closing balance Opening balance
Mechanical equipment 5,326.79 26,918.21
Total 5,326.79 26,918.21
Others:
15. Intangible assets
(1) Intangible assets
In RMB
Unpatented
Items Land using right Patent Computer software Total
technologies
I. Book value
1. Opening
98,015,399.41 9,448,727.46 24,019,238.42 7,456,636.99 138,940,002.28
balance
2. Increase in
36,388.39 490,714.53 527,102.92
this period
(1) Purchase 36,388.39 490,714.53 527,102.92
(2) Internal
R&D
(3) Increase
due to enterprise
merger
3. Decrease in this
87,820.00 143,726.50 231,546.50
period
(1) Purchase 87,820.00 143,726.50 231,546.50
4. Closing
98,015,399.41 9,397,295.85 24,019,238.42 7,803,625.02 139,235,558.70
balance
II. Accumulative
0.00
amortization
1. Opening 11,365,168.18 3,542,247.06 15,724,158.37 3,835,233.81 34,466,807.42
126
China Fangda Group Co., Ltd. 2015 Annual Report
balance
2. Increase in
1,971,700.04 1,492,038.48 767,930.15 4,231,668.67
this period
(1) Provision 1,971,700.04 920,049.60 571,988.88 767,930.15 4,231,668.67
3. Decrease in
32,815.35 18,948.29 51,763.64
this period
(1) Purchase 32,815.35 18,948.29 51,763.64
4. Closing
13,336,868.22 4,429,481.31 16,296,147.25 4,584,215.67 38,646,712.45
balance
III. Impairment
provision
1. Opening
5,525,863.77 5,525,863.77
balance
2. Increase in
this period
(1) Provision
3. Decrease in
this period
(1) Purchase
4. Closing
5,525,863.77 5,525,863.77
balance
IV. Book value
1. Closing book
84,678,531.19 4,967,814.54 2,197,227.40 3,219,409.35 95,062,982.48
value
2. Opening
86,650,231.23 5,906,480.40 2,769,216.28 3,621,403.18 98,947,331.09
book value
Intangible asset formed by internal R&D of the period takes up 3.39% in the closing total book value of intangible assets.
(2) Failure to obtain the land use right certificates
In RMB
Items Book value Reason
Xinjin Jinhua Hongyan Village Group 1
4,758,304.86 Applying for
industrial land 33,314.58 m2
127
China Fangda Group Co., Ltd. 2015 Annual Report
Others:
Shenyang Fangda, a subsidiary of the Company, entered the liquidation procedure in the period. The
amortizable value RMB5,525,863.77 of non-patent technology without realizable value is fully
provided for intangible assets impairment.
16. Goodwill
(1) Original book value of goodwill
In RMB
Invested entity or
Opening balance Increase Decrease Closing balance
item of goodwill
Shenzhen Woke 8,197,817.29 8,197,817.29
Fangda SOZN 26,279,395.89 26,279,395.89
Total 34,477,213.18 34,477,213.18
(2) Goodwill impairment provision
In RMB
Invested entity or
Opening balance Increase Decrease Closing balance
item of goodwill
Shenzhen Woke 8,197,817.29 8,197,817.29
Fangda SOZN 6,452,698.92 6,452,698.92
Total 8,197,817.29 6,452,698.92 14,650,516.21
Test process of goodwill impairment, parameters and recognition method of goodwill impairment loss:
Notes:
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.
The Company acquired the 60% control power over Fangda SOZN by merger of enterprise under common
control in August 2014. The difference between the initial investment cost of RMB48 million and recognizable
fair value of the investee has formed the goodwill of RMB26,279,395.89. The Company performed impairment
test on the goodwill of the investment and made impairment provision of RMB6,452,698.92 based on the current
value of future cash flows.
(3) Others
17. Long-term amortizable expenses
In RMB
Items Opening balance Increase in this Amortized amount Other decrease Closing balance
128
China Fangda Group Co., Ltd. 2015 Annual Report
period in this period
Epoxy floor 958,526.63 162,004.50 796,522.13
Plant and dormitory
1,039,476.73 443,246.64 596,230.09
decoration
Upgrading of
workshop rented by
243,227.20 41,108.82 202,118.38
Fangda Jianke
Nanchang Branch
Upgrading of
workshop rented by 68,666.67 68,666.67 0.00
Fangda Jianke
Renovation of office
and plants rented by 9,112.60 7,810.80 1,301.80
Chengdu Fangda
Jinshan factory
renovation of
412,028.66 109,874.16 302,154.50
Fangda Jianke
Shanghai Branch
Expense of
renovation of leased
fixed assets by 334,423.17 111,474.36 222,948.81
Fangda Property
Development
Dongguan separation
311,269.21 77,817.36 233,451.85
project
Upgrading of
workshop rented by 562,044.31 2,872,375.28 940,109.51 2,494,310.08
Fangda SOZN
Anti-junk email
33,013.06 16,506.60 16,506.46
module service fee
Fangda Building
Floor #5 wiring 68,442.72 30,419.04 38,023.68
project
Xuanfeng Chayuan
village and Zhuyuan
1,340,062.50 35,735.04 1,304,327.46
village land transfer
compensation
Membership fee 300,000.00 300,000.00
Others 79,131.67 95,071.70 67,309.73 106,893.64
Total 4,119,362.63 4,607,509.48 2,112,083.23 6,614,788.88
129
China Fangda Group Co., Ltd. 2015 Annual Report
(3) Others
18. Differed income tax assets and differed income tax liabilities
(1) Non-deducted deferred income tax assets
In RMB
Closing balance Opening balance
Items Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Assets impairment
216,918,204.09 37,575,529.18 215,379,455.02 33,823,708.10
provision
Unrealized profit of
23,008,088.13 3,788,898.02 11,839,968.61 2,579,827.55
internal transactions
Deductible loss 85,665,697.71 20,944,182.55 56,605,182.29 13,897,641.41
Reserved expense 2,153,753.44 323,063.02 3,055,220.98 458,283.15
Reserved wage 3,519,976.72 527,996.51 3,087,427.61 463,114.14
Deferred earning 2,563,904.83 619,823.84 2,161,818.23 515,225.13
Anticipated liabilities 1,921,446.51 288,216.98 5,859,045.98 878,856.90
Advertisement fee 3,847,702.76 961,925.69
Adjustment of fair value
5,981,164.89 897,174.73
of investment real estate
Total 345,579,939.08 65,926,810.52 297,988,118.72 52,616,656.38
(2) Non-deducted deferred income tax liabilities
In RMB
Closing balance Opening balance
Items Taxable temporary Deferred income tax Taxable temporary Deferred income tax
difference liabilities difference liabilities
Gain/loss caused by
291,979,073.34 72,994,768.34 198,937,747.60 49,734,436.90
changes in fair value
Total 291,979,073.34 72,994,768.34 198,937,747.60 49,734,436.90
(3) Details of unrecognized deferred income tax assets
In RMB
Items Closing balance Opening balance
Deductible temporary difference 51,201,110.67 40,015,820.28
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China Fangda Group Co., Ltd. 2015 Annual Report
Deductible loss 151,155,750.92 70,274,405.85
Total 202,356,861.59 110,290,226.13
(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
2015 7,240,577.12
2016 19,999,060.04 19,999,060.04
2017 20,241,373.78 20,241,373.78
2018 11,130,985.83 11,130,985.83
2019 11,662,409.08 11,662,409.08
2020 88,121,922.19
Total 151,155,750.92 70,274,405.85 --
Others:
The form does not include suspension of subsidiaries in advance.
19. Other non-current assets
In RMB
Items Closing balance Opening balance
Prepaid house and equipment amount 91,863,898.92 41,684,590.97
Input tax to be deducted 1,640,057.47 1,639,287.66
Total 93,503,956.39 43,323,878.63
Others:
Notes:
(1) The closing balance of other non-current assets is mainly the prepaid house payment of Fangda Jianke.
(2) The closing balance of input tax to be deducted is mainly due to the suspension of operations of Shenyang
Fangda and Shenzhen Woke.
20. Short-term borrowings
(1) Classification of short-term borrowings
In RMB
Items Closing balance Opening balance
Loan by pledge 200,000,000.00 200,000,000.00
Guarantee loan 943,000,000.00 900,000,000.00
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China Fangda Group Co., Ltd. 2015 Annual Report
Discount borrowing of commercial
4,957,775.82
acceptance bills
Total 1,147,957,775.82 1,100,000,000.00
Notes to classification of short-term borrowings:
Note: By December 31, 2015, the Group’s pledge borrowing is mainly obtained by pledging buildings. For details,
please see Note VII. 52.
21. Notes payable
In RMB
Type Closing balance Opening balance
Commercial acceptance 78,934,714.94 12,106,210.45
Bank acceptance 224,592,924.69 215,160,275.12
Total 303,527,639.63 227,266,485.57
At the end of period, the amount of payable bills mature but not paid is RMB218,971.93.
22. Account payable
(1) Account payable
In RMB
Items Closing balance Opening balance
Account repayable and engineering
611,292,302.23 558,886,064.80
repayable
Construction payable 27,529,577.05 21,675,087.66
Payable installation and implementation
225,793,206.11 102,780,295.76
fees
Others 3,013,270.26 1,766,898.51
Total 867,628,355.65 685,108,346.73
(2) Significant payables aging more than 1 year
In RMB
Items Closing balance Reason
Due from Shenzhen Fangda, unable to
Liaoning Jindi 2nd Construction Co., Ltd. 3,819,140.02
repay
Shenzhen Gongkan Geotechnical Group
2,393,148.65 Immature
Co., Ltd.
Total 6,212,288.67 --
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China Fangda Group Co., Ltd. 2015 Annual Report
Others:
23. Prepayment received
(1) Prepayment received
In RMB
Items Closing balance Opening balance
Curtain wall and screen door engineering
123,894,561.69 115,346,105.96
payment
Material loan 5,515,676.69 6,106,352.73
Others 1,164,081.47 832,772.45
Total 130,574,319.85 122,285,231.14
Others:
No significant prepayment aged more than 1 year at the end of the year
24. Employees wage payable
(1) Employees wage payable
In RMB
Items Opening balance Increase Decrease Closing balance
1. Short-term
41,651,071.51 267,413,651.10 268,259,252.77 40,805,469.84
remuneration
2. Retirement pension
program-defined 52,242.75 14,628,993.82 14,674,278.36 6,958.21
contribution plan
3. Dismiss compensation 714,187.67 584,187.67 130,000.00
Total 41,703,314.26 282,756,832.59 283,517,718.80 40,942,428.05
(2) Short-term remuneration
In RMB
Items Opening balance Increase Decrease Closing balance
1. Wage, bonus,
39,519,553.05 248,931,185.07 249,822,808.61 38,627,929.51
allowance and subsidies
2. Employee welfare 7,577,825.03 7,577,825.03 0.00
3. Social insurance 39,612.75 4,710,163.33 4,681,775.81 68,000.27
Including: 33,570.00 3,569,804.99 3,535,891.94 67,483.05
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China Fangda Group Co., Ltd. 2015 Annual Report
medical insurance
Labor injury
3,357.00 707,423.27 710,264.75 515.52
insurance
Breeding
2,685.75 432,935.07 435,619.12 1.70
insurance
4. Housing fund 42,585.20 4,866,929.95 4,812,433.15 97,082.00
5. Labor union budget
2,049,320.51 1,327,547.72 1,364,410.17 2,012,458.06
and staff education fund
Total 41,651,071.51 267,413,651.10 268,259,252.77 40,805,469.84
(3) Defined contribution plan
In RMB
Items Opening balance Increase Decrease Closing balance
1. Basic pension 49,755.00 13,672,689.58 13,716,007.83 6,436.75
2. Unemployment
2,487.75 956,304.24 958,270.53 521.46
insurance
Total 52,242.75 14,628,993.82 14,674,278.36 6,958.21
Others:
25. Taxes payable
In RMB
Items Closing balance Opening balance
VAT 6,981,753.65 6,739,115.69
Business tax 32,136,293.62 25,489,264.49
Enterprise income tax 16,555,365.28 16,071,901.30
Personal income tax 1,201,365.12 1,228,564.47
City maintenance and construction tax 2,824,794.21 2,329,212.21
Land using tax 3,683,884.01 2,534,674.36
Property tax 2,083,844.87 2,287,765.04
Education surtax 1,315,453.14 1,123,167.45
Local education surtax 489,642.89 298,064.57
Others 261,036.91 595,196.67
Total 67,533,433.70 58,696,926.25
Others:
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China Fangda Group Co., Ltd. 2015 Annual Report
26. Interest payable
In RMB
Items Closing balance Opening balance
Long-term borrowing with interest
installment and repayment of principal 510,166.05
upon maturity
Short-term borrowing interests payable 2,578,576.91 2,055,911.11
Others 153,091.47
Total 3,241,834.43 2,055,911.11
Significant interest overdue but not paid
In RMB
Borrower Overdue amount Reason
Note:
27. Other payables
(1) Other payables presented by nature
In RMB
Items Closing balance Opening balance
Performance and quality deposit 21,697,760.34 22,806,218.88
Deposit 9,027,418.36 6,264,664.14
Reserved expense 11,714,478.57 9,369,196.08
Fangda Town pledge 2,900,000.00
Lawsuit indemnity 23,456,765.40
Others 13,880,924.14 8,985,603.34
Total 82,677,346.81 47,425,682.44
Note: The lawsuit indemnity is the engineering, deposit and interest payable to Wang Weihong provided according to the second
instance. See Note XIII, 1 for details.
(2) Significant payables aging more than 1 year
In RMB
Items Closing balance Reason
Guangzhou Nanjian Civil Engineering Co.,
11,289,683.50 Performance deposit immature
Ltd.
135
China Fangda Group Co., Ltd. 2015 Annual Report
Total 11,289,683.50 --
(3) Others
28. Non-current liabilities due within 1 year
In RMB
Items Closing balance Opening balance
Long-term payables due within 1 year 6,000,000.00
Total 6,000,000.00
Others:
29. Other current liabilities
In RMB
Items Closing balance Opening balance
Loan financing of precious metal 98,425,600.00
Total 98,425,600.00
Others:
Note: The Company and Industrial Bank Shenzhen Branch signed the noble metal leasing contract on September
25, 2015. The Company borrowed gold from Industrial Bank Shenzhen Branch and entrusted the bank to provide
noble metal quotation service. The transaction amount is RMB98,425,600.00. The transaction date is September
28, 2015. The maturity date is September 19, 2016. The Company irrevocably authorizes the bank to provide
noble metal returning service upon maturity.
30. Long-term borrowings
(1) Classification of long-term borrowings
In RMB
Items Closing balance Opening balance
Loan by pledge 300,395,582.06
Total 300,395,582.06
Notes to classification of long-term borrowings:
Note: The above-mentioned borrowing is the 100% stock pledging of Fangda Property Development held by the
Company. The interest rate is between 5.39-6.785%.
31. Long-term payables
Item Closing amount Opening amount
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China Fangda Group Co., Ltd. 2015 Annual Report
Stock transfer payment payable 12,000,000.00
Less: Long-term payables due within 1 year 6,000,000.00
Total 6,000,000.00
32. Anticipated liabilities
In RMB
Items Closing balance Opening balance Reason
Pending lawsuit 5,039,045.98
Others 1,921,446.51 820,000.00
Total 1,921,446.51 5,859,045.98 --
Note: including related significant assumptions and estimates for anticipated liabilities
33. Deferred earning
In RMB
Items Opening balance Increase Decrease Closing balance Reason
Government subsidy 10,049,892.04 2,487,600.00 253,296.36 12,284,195.68 Assets-related
Total 10,049,892.04 2,487,600.00 253,296.36 12,284,195.68 --
Items involving government subsidies:
In RMB
Amount included
Amount of new Related to
Liabilities Opening balance in non-operating Other change Closing balance
subsidy assets/earning
revenue
Major investment
project prize from
Industry and
Trade
1,909,523.90 57,142.80 1,852,381.10 Assets-related
Development
Division of
Dongguan
Finance Bureau
Massive
production
project of
air-breathing 7,888,073.81 122,256.30 7,765,817.51 Assets-related
double-layer
hollow glass
energy-saving
137
China Fangda Group Co., Ltd. 2015 Annual Report
curtain call
Railway transport
screen door
controlling
system and 252,294.33 40,770.60 211,523.73 Assets-related
information
transmission
technology
LED production
expansion
technology 1,906,100.00 31,768.33 1,874,331.67 Assets-related
renovation
project
Scientific
achievement
purchase and
81,500.00 1,358.33 80,141.67 Assets-related
technological
innovation
service subsidy
Nanshan District
micro-business 500,000.00 500,000.00 Assets-related
loan discount
Total 10,049,892.04 2,487,600.00 253,296.36 12,284,195.68 --
Others:
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.
资助内容：It provides subsidy on the interest of loans obtained by registered small and micro businesses in
Nanshan District from any banks in Shenzhen. Small and micro businesses registered in Nanshan District without
default records can apply for 5% of the loan amount at the highest to the Nanshan special fund management team.
A single subsidy is no more than RMB500,000. It provides subsidy on the interest of loans obtained by registered
small and micro businesses in Nanshan District from any banks in Shenzhen. Small and micro businesses
registered in Nanshan District without default records can apply for 5% of the loan amount at the highest to the
138
China Fangda Group Co., Ltd. 2015 Annual Report
Nanshan special fund management team. A single subsidy is no more than RMB500,000.The item will become a
long-term assets. The Company treats it as assets-related government subsidy.
(5) The technological achievement or innovative service purchase subsidy is the subsidy obtained by Fangda
SOZN according to the Notice on Applying for 2015 Zhongshan Scientific and Technological Development Fund
and Patent Fund (Zhong Shan Ke Fa [2015] No.104), Notice on Temporary Regulations on Zhongshan Scientific
and Technological Development Fund and Notice on Temporary Regulations on Zhongshan Special Patent Fund.
As the item is related to assets, the Company treats it as assets-related government subsidy.
(6) The Nanshan District Micro-Business Development Load Discount is provided to promote the development
small and micro businesses and solve financing problems for small and micro businesses. It provides subsidy on
the interest of loans obtained by registered small and micro businesses in Nanshan District from any banks in
Shenzhen. Small and micro businesses registered in Nanshan District without default records can apply for 5% of
the loan amount at the highest to the Nanshan special fund management team. A single subsidy is no more than
RMB500,000.As the interest is capitalized in unsold inventory, the Company treats it as assets-related gonverment
subsidy.
34. Capital share
In RMB
Change (+,-)
Opening Closing
Issued new Transferred
balance Bonus shares Others Subtotal balance
shares from reserves
Total of capital
756,909,905.00 756,909,905.00
shares
Others:
(1) There is no change in the Company’s capital shares in the period.
(2) By 31.12.15, the Company has 972,042 restricted shares, all of which are held by senior management natural
person.
34. Capital reserve
In RMB
Items Opening balance Increase Decrease Closing balance
Capital premium (share
38,238,222.48 38,238,222.48
capital premium)
Other capital reserves 40,860,997.90 398.76 40,861,396.66
Total 79,099,220.38 398.76 79,099,619.14
Other note, including explanation about the reason of the change:
The other capital reserves increased by RMB3.9876 million, which is the historical dividend refunded by the
Shenzhen branch of China Securities Depository and Clearing Company Limited.
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China Fangda Group Co., Ltd. 2015 Annual Report
35. Other miscellaneous income
In RMB
Amount occurred in the current period
Less: amount
After-tax
written into
After-tax amount
Opening Amount other gains Less: Closing
Items amount attributed to
balance before and transferred Income tax balance
attributed to minority
income tax into gain/loss expenses
the parent shareholder
in previous
s
terms
2. Other misc. incomes that will be
91,831.63 91,831.63
re-classified into gain and loss
Investment real estate
91,831.63 91,831.63
measured at fair value
Other miscellaneous income 91,831.63 91,831.63
Other note, including the adjustment of the initial recognition amount of the effective part of the cash flow
hedging profit and loss transferred to the hedged item:
36. Surplus reserves
In RMB
Items Opening balance Increase Decrease Closing balance
Statutory surplus
48,842,080.76 2,281,473.75 51,123,554.51
reserves
Total 48,842,080.76 2,281,473.75 51,123,554.51
Note, including explanation about the reason of the change:
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 349,987,825.69 278,149,631.63
Retained profit adjusted at beginning of year 349,987,825.69 278,149,631.63
Plus: Net profit attributable to owners of the
107,272,369.77 96,998,429.76
parent
Less: Statutory surplus reserves 2,281,473.75 2,452,938.55
Common share dividend payable 22,707,297.15 22,707,297.15
140
China Fangda Group Co., Ltd. 2015 Annual Report
Closing retained profit 432,271,424.56 349,987,825.69
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 2,492,635,367.98 2,135,389,422.03 1,896,533,575.46 1,573,131,645.17
Other businesses 57,832,126.80 36,134,778.32 41,790,860.05 17,705,140.85
Total 2,550,467,494.78 2,171,524,200.35 1,938,324,435.51 1,590,836,786.02
39. Business tax and surcharge
In RMB
Items Amount occurred in the current period Occurred in previous period
Business tax 23,143,208.47 14,227,005.22
City maintenance and construction tax 5,128,049.65 4,077,936.61
Education surtax 3,704,749.51 2,163,665.87
Property tax 1,024,088.16 1,019,630.24
Land using tax 125,624.48 107,681.50
Others 490,836.33 1,259,720.55
Total 33,616,556.60 22,855,639.99
Others:
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 28,418,273.77 23,748,948.40
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China Fangda Group Co., Ltd. 2015 Annual Report
Freight and miscellaneous charges 6,900,391.34 6,207,886.36
Travel expense 5,536,009.56 5,067,027.92
Entertainment expense 2,068,156.06 2,204,861.40
Material consumption 1,693,577.61 1,449,539.85
Office costs 1,440,412.04 1,246,910.58
Rental 1,572,252.20 1,295,860.13
Advertisement and promotion fee 25,047,722.73 2,041,379.42
Others 2,588,155.87 1,421,892.64
Total 75,264,951.18 44,684,306.70
Others:
The increase from last year is mainly because that Fangda SOZN increased its advertisement and promotion
expense to expand its business.
41. Management expenses
In RMB
Items Amount occurred in the current period Occurred in previous period
Labor costs 83,667,856.48 75,477,871.56
Depreciation and amortization 20,481,357.98 18,501,963.63
Agencies 2,656,463.76 3,603,925.17
Tax 6,751,421.27 6,689,450.36
Maintenance costs 3,412,131.84 4,055,124.83
Water and electricity 1,184,279.09 1,594,371.07
Office expense 3,571,187.92 3,010,166.04
Travel expense 4,045,460.27 2,577,863.90
R&D 15,984,404.14 16,901,351.15
Entertainment expense 2,645,057.19 2,024,918.27
Rental 4,785,932.74 2,334,921.30
Lawsuit 649,572.33 1,950,459.20
Material consumption 778,422.18 1,754,537.01
Property management fee 2,516,885.44 2,386,763.59
Waste loss 4,691,551.61
Others 9,583,792.01 9,721,026.52
Total 167,405,776.25 152,584,713.60
Others:
The waste loss is the loss of waste of poor-quality products of Fangda SOZN.
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China Fangda Group Co., Ltd. 2015 Annual Report
42. Financial expenses
In RMB
Items Amount occurred in the current period Occurred in previous period
Interest expense 80,931,355.63 46,439,424.36
Less: interest capitalization 28,904,802.93 15,466,418.47
Less: Interest income 3,457,387.56 3,193,733.32
Acceptant discount 65,135.33 248,232.09
Exchange gain/loss -1,714,534.78 -383,218.13
Commission charges and others 3,752,724.36 1,520,772.27
Total 50,672,490.05 29,165,058.80
Others:
43. Assets impairment loss
In RMB
Items Amount occurred in the current period Occurred in previous period
1. Bad debt loss 34,581,867.08 23,199,527.20
2. Inventory depreciation loss 8,985,113.10 1,587,161.72
7. Fixed assets impairment loss 2,651,337.41
13. Goodwill impairment loss 6,452,698.92
Total 50,019,679.10 27,438,026.33
Others:
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 3,952,285.09 -2,852,885.00
income account
Investment real estate measured at fair
85,793,780.49 34,897,632.10
value
Total 89,746,065.58 32,044,747.10
Others:
143
China Fangda Group Co., Ltd. 2015 Annual Report
45. Investment income
In RMB
Items Amount occurred in the current period Occurred in previous period
Gains from long-term equity investment
-358,979.50 1,054,094.88
measured by equity
Investment gain obtained from disposal of
-1,478,245.70
long-term equity investment
Investment gain obtained from disposal of
financial assets measured at fair value with
389,031.83
variations accounted into current income
account
Other investment gains 250,897.54 2,144,844.80
Total 280,949.87 1,720,693.98
Others:
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
51,130.66 3,162,999.40
non-current assets
Including: Gains from disposal
51,130.66 3,162,999.40
of fixed assets
Government subsidy 2,246,386.84 2,340,175.75
Penalty income 1,339,217.86 217,749.21
Payable account not able to be
2,269,833.14 1,447,458.99
paid
Compensation received 51,499.74 41,826.64
VAT rebated into revenue 2,086,502.67 1,886,134.97
Others 21,623,539.34 7,185,114.22
Total 29,668,110.25 16,281,459.18
Government subsidies accounted into current profit or loss:
In RMB
Whether Amount
Whether it is Occurred in Related to
affecting gain occurred in
Item Issuer Reason Nature a special previous assets/earnin
and loss in the current
subsidy period g
this year period
144
China Fangda Group Co., Ltd. 2015 Annual Report
Railway
transport Subsidy for
screen door Shenzhen research
controlling Technology development, Assets-relate
Subsidy No No 40,770.60 42,142.45
system and Innovation technology d
information Committee upgrade and
transmission improvement
technology
Major
investment
project prize
from Industry Gongguan Local subsidy
and Trade Trade and for Assets-relate
Subsidy No No 57,142.80 57,142.80
Development Industry encouraging d
Division of Bureau investment
Dongguan
Finance
Bureau
Massive
production Subsidy for
project of Guangdong research
air-breathing Development development, Assets-relate
Subsidy No No 122,256.30 106,646.64
double-layer and Reform technology d
hollow glass Commission upgrade and
energy-savin improvement
g curtain call
LED Subsidy for
production Zhongshan research
expansion Reform and development, Assets-relate
Subsidy No No 31,768.33
technology Development technology d
renovation Bureau upgrade and
project improvement
Scientific
Subsidy for
achievement
Zhongshan research
purchase or
Reform and development, Assets-relate
technological Subsidy No No 1,358.33
Development technology d
innovation
Bureau upgrade and
service
improvement
subsidy
Subsidy for
Shenzhen Shenzhen
research Earning-relat
hi-tech National Tax Subsidy No No 1,011,800.00
development, ed
technology Bureau
technology
145
China Fangda Group Co., Ltd. 2015 Annual Report
subsidy upgrade and
improvement
China
well-known
trademark, Subsidy for
Guangdong National research
well-known Trademark development, Earning-relat
Subsidy No No 200,000.00
trademark Administratio technology ed
and n upgrade and
Guangdong improvement
well-known
brand subsidy
Nanchang
Nanchang
Industrial and Subsidy for
Industrial and
Information research
Information
Commission, development, Earning-relat
Commission, Subsidy No No 200,000.00
Finance technology ed
Finance
Bureau upgrade and
Bureau
industry improvement
industry
subsidy
Nanchang
hi-tech
Nanchang
industrial Subsidy for
Hi-tech
park research
Industry Park
management development, Earning-relat
management Subsidy No No 100,000.00
committee technology ed
committee,
and finance upgrade and
Finance
bureau improvement
Bureau
project
subsidy
Subsidy for
Xinjin research
Chengdu
Economy and development, Earning-relat
New Material Award No No 100,000.00
Development technology ed
subsidy
Bureau upgrade and
improvement
Nanchang Subsidy for
hi-tech area Nanchang research
management Hi-tech Area development, Earning-relat
Subsidy No No 150,000.00
committee management technology ed
industry committee upgrade and
subsidy improvement
146
China Fangda Group Co., Ltd. 2015 Annual Report
Nanchang
hi-tech
Nanchang
finance
Hi-tech
bureau
Industry Park
industry Earning-relat
management Subsidy No No 162,900.00 141,100.00
development ed
committee,
zone
Finance
committee
Bureau
exhibition
subsidy
Jiangxi
Finance
Jiangxi
Department Earning-relat
Finance Subsidy No No 136,700.00
export ed
Department
exhibition
subsidy
Zhongshan
Finance Zhongshan
Earning-relat
Bureau Dubai Finance Subsidy No No 403,590.48
ed
exhibition Bureau
subsidy
Shenzhen
Market and
Quality Shenzhen
Supervisory Market and
Committee, Quality
Subsidy for
Nanshan Supervisory
research
Market Administratio
development, Earning-relat
Supervisory n, Nanshan Award No No 1,000,000.00
technology ed
Management Market and
upgrade and
Bureau, 2014 Quality
improvement
Nanshan Supervisory
People’s Administratio
Government n
high quality
award
Xinjin Xinjin
Technology Economic
Earning-relat
Commission and Subsidy No No 173,200.00
ed
2015 plant Technology
lease subsidy Committee
Dongguan Gongguan
Subsidy No No 100,000.00 Earning-relat
Economic Economy and
147
China Fangda Group Co., Ltd. 2015 Annual Report
and Information ed
Information Bureau
Bureau
enterprise
development
training
subsidy
Micro-busine
Earning-relat
ss load Subsidy No No 100,000.00
ed
discount
Earning-relat
Others No No 53,400.00 94,643.86
ed
Total -- -- -- -- -- 2,246,386.84 2,340,175.75 --
Others:
(1) Major projects are disclosed as follows:
1. A total of RMB18 million does not need to be paid as the share transfer payment and reduced as minority interests because the
promised performance condition was not met. See Note XV.3 for details.
2. The waste income is RMB2,919,631.00.
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
574,079.38 1,709,152.13
non-current assets
Including: Losses from disposal
572,147.30 1,709,152.13
of fixed assets
Intangible asset disposal
1,932.08
loss
Donation 103,000.00 958,000.00
Penalty and overdue fine 745,502.42 364,256.62
Lawsuit indemnity 16,072,719.43 5,039,045.98
Others 738,438.84 2,553,257.37
Total 18,233,740.07 10,623,712.10
Others:
Note: The lawsuit indemnity is the engineering, deposit and interest payable to Wang Weihong provided
according to the second instance. See Note XIII. 1 for details.
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China Fangda Group Co., Ltd. 2015 Annual Report
48. Income tax expenses
(1) Details about income tax expense
In RMB
Items Amount occurred in the current period Occurred in previous period
Income tax expenses in this period 25,259,694.31 18,618,875.30
Deferred income tax expenses 9,950,177.30 -1,125,127.73
Total 35,209,871.61 17,493,747.57
(2) Adjustment process of accounting profit and income tax expense
In RMB
Items Amount occurred in the current period
Total profit 103,425,226.88
Income tax expenses calculated based on the legal (or applicable)
25,856,306.73
tax rates
Impacts of different tax rates applicable for some subsidiaries -15,524,249.92
Impacts of income tax before adjustment -891,669.66
Impacts of non-deductible cost, expense and loss 3,177,009.40
Impacts of using deductible loss of unrecognized deferred
-124,836.15
income tax assets
Deductable temporary difference and deductable loss of
24,823,213.25
unrecognized deferred income tax assets
Taxation impact of R&D expense and (presented with “-”) -769,745.00
Non-taxable income -4,158,274.96
Others 2,732,373.04
Income tax expenses 35,209,871.61
Other note
Others mainly include the provided income tax of RMB1,119,198.31 paid for liquidation of Hong Kong Junjia
and income tax not provided for goodwill impairment loss in this period.
49. Other miscellaneous income
See Note 35
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China Fangda Group Co., Ltd. 2015 Annual Report
50. Notes to the cash flow statement
(1) Other cash inflow related to operation
In RMB
Items Amount occurred in the current period Occurred in previous period
Interest income 3,457,387.56 3,230,120.82
Subsidy income 4,424,840.91 2,134,243.86
Retrieving of deposits for exchange bills 21,616,730.24
Retrieving of bidding deposits 32,627,388.88 9,893,934.66
Other operating accounts 18,283,799.79 16,028,346.33
Total 80,410,147.38 31,286,645.67
Notes to other cash inflow related to operation:
(2) Other cash paid related to operation
In RMB
Items Amount occurred in the current period Occurred in previous period
Sales expense 45,847,988.68 17,958,181.41
Administrative expense 47,475,924.55 38,615,205.18
Bidding deposit paid 20,962,337.79 868,076.30
Net draft deposit net paid 61,152,900.09
Other trades 43,684,340.50 14,978,873.55
Total 157,970,591.52 133,573,236.53
Notes to other cash paid related to operation:
(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
construction projects
Total 65,500.00
Notes to other cash received related to investment activities:
(4) Other cash paid related to investment activities
In RMB
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China Fangda Group Co., Ltd. 2015 Annual Report
Items Amount occurred in the current period Occurred in previous period
Bidding deposit paid related to
263,000.00 331,500.00
construction projects
Total 263,000.00 331,500.00
Notes to other cash paid related to investment activities:
(5) Other cash received related to financing
In RMB
Items Amount occurred in the current period Occurred in previous period
Fractional historical dividend 398.76
Total 398.76
Notes to other cash received related to financing:
(6) Other cash paid related to financing
In RMB
Items Amount occurred in the current period Occurred in previous period
Financing commissioning 1,063,032.79
Financing deposit 53,500,000.00
Total 54,563,032.79
Notes to other cash paid related to financing:
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 68,215,355.27 92,689,344.66
Plus: Asset impairment provision 50,019,679.10 27,438,026.33
Fixed asset depreciation, gas and petrol
29,667,469.67 26,131,186.99
depreciation, production goods depreciation
Amortization of intangible assets 4,231,668.67 3,670,872.39
Amortization of long-term amortizable
2,112,083.23 1,336,953.32
expenses
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China Fangda Group Co., Ltd. 2015 Annual Report
Loss from disposal of fixed assets, intangible
assets, and other long-term assets (“-“ for 467,841.04 -1,453,847.27
gains)
Loss from fixed asset discard (“-“ for gains) 55,107.68
Loss from fair value fluctuation (“-“ for
-89,746,065.58 -32,044,747.10
gains)
Financial expenses (“-“ for gains) 53,288,131.52 30,961,335.85
Investment losses (“-“ for gains) -280,949.87 -1,720,693.98
Decrease of deferred income tax asset
-13,310,154.14 -10,202,800.67
(“-“ for increase)
Increase of deferred income tax asset (“-“ for
23,260,331.44 9,077,672.93
increase)
Decrease of inventory (“-“ for increase) -344,116,557.17 -523,064,898.18
Decrease of operational receivable items
-382,966,262.27 -292,111,913.10
(“-“ for increase)
Increase of operational receivable items
296,786,891.68 172,552,478.48
(“-“ for decrease)
Others -58,424,681.46 -61,152,900.09
Cash flow generated by business operations,
-360,115,114.04 -557,893,929.44
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 247,739,243.78 102,638,232.19
Less: Initial balance of cash 102,638,232.19 285,237,255.38
Net increase in cash and cash equivalents 145,101,011.59 -182,599,023.19
(2) Composition of cash and cash equivalents
In RMB
Items Closing balance Opening balance
I. Cash 247,739,243.78 102,638,232.19
Including: Cash in stock 28,072.46 40,733.33
Bank savings can be used at any time 242,777,612.25 102,515,874.25
Other monetary capital can be used at
4,933,559.07 81,624.61
any time
3. Balance of cash and cash equivalents at 247,739,243.78 102,638,232.19
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China Fangda Group Co., Ltd. 2015 Annual Report
end of term
Others:
The amount of endorsed and transferred bank acceptance bills received from sales of products is
RMB201,753,470.87.
52. Ownership- or use-right-restricted assets
In RMB
Items Closing book value Reason
Monetary capital 153,214,093.54 Frozen deposit and pledge
Notes receivable 0.00 Loan by pledge
Fixed assets 72,007,118.50 Borrowing pledge or frozen by a court
Investment real estate 285,817,691.53 Loan by pledge
100% stake in Fangda Property
200,000,000.00 Loan by pledge
Development held by the Company
Total 711,038,903.57 --
Others:
53. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
Closing foreign currency
Items Exchange rate Closing RMB balance
balance
Monetary capital
Including: USD 386,078.46 6.4936 2,506,998.05
HK Dollar 3,837,788.15 0.83778 3,215,222.42
SGD 158,228.36 4.5875 725,872.60
Including: USD 7,867,710.91 6.4936 51,089,767.53
HK Dollar -28,385,668.25 0.83778 -23,780,958.22
SGD 2,710,000.00 4.5875 12,432,125.00
AUD -40,000.00 4.7276 -189,104.00
Other receivables
Including: SGD 74,235.00 4.5875 340,553.06
Account payable
Including: SGD 225,000.00 4.5875 1,032,187.50
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China Fangda Group Co., Ltd. 2015 Annual Report
Other payables
Including: USD 6,120.00 6.4936 39,740.83
HK Dollar 100.00 0.83778 78.89
Others:
54. Hedging
Hedging items and related tools, qualitative and quantitative information about hedging risks:
VIII. Change to Consolidation Scope
1. Change to the consolidation scope for other reasons
In the period, the Company expanded its direct or indirect control to another eight subsidiaryies including Jiangxi
Fangda Property Development Co., Ltd., Shenzhen Fangda Property Management Co., Ltd., Shenzhen Qianhai
Kechuangyuan Software Co., Ltd., Ganzhou Longneng New Energy Co., Ltd., Pingxiang Fangda Luxin New
Energy Co., Ltd., Pingxiang Xiangdong Fangda New Energy Co., Ltd., Nanchang Xinjian Fangda New Energy
Co., Ltd. and Dongguan Fangda New Energy Co., Ltd.
In the period, the Company finished the liquidation of directly control subsidiary Hong Kong Junjia, which is
removed from the consolidated financial statements.
IX. Equity in Other Entities
1. Interests in subsidiaries
(1) Group Composition
Registered Shareholding
Company Place of business Business Obtaining method
address Direct Indirect
Designing,
manufacturing,
Fangda Jianke Shenzhen Shenzhen 98.39% 1.61% Incorporation
and installation of
curtain walls
Production,
processing and
Fangda
Shenzhen Shenzhen installation of 14.00% 86.00% Incorporation
Automatic
subway screen
doors
Production and
Fangda New sales of new-type
Nanchang Nanchang 75.00% 25.00% Incorporation
Material materials
composite
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China Fangda Group Co., Ltd. 2015 Annual Report
materials and
production of
curtain walls
Design,
production, sales
Fangda and installation of
Nanchang Nanchang 99.00% 1.00% Incorporation
Aluminium aluminum
materials, doors
and windows
Manufacturing of
semiconductor
lighting material
and chips;
lighting source
encapsulation;
developing,
Shenyang Fangda Shenyang Shenyang 64.58% Incorporation
designing,
manufacturing,
engineering,
installation and
trading of
semiconductor
lighting system
Computer
Kexunda Shenzhen Shenzhen software 100.00% Incorporation
development
Real estate
Fangda Property Shenzhen Shenzhen development and 100.00% Incorporation
operation
Design and
Fangda New
Shenzhen Shenzhen construction of 100.00% Incorporation
Energy
PV power plants
Trusted
processing of
Chengdu Fangda Chengdu Chengdu 100.00% Incorporation
building curtain
wall materials
Shihui
International Virgin Islands Virgin Islands Investment 100.00% Incorporation
Holding Co., Ltd.
Installation and
Dongguan New
Dongguan Dongguan sales of building 100.00% Incorporation
Material
curtain walls
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China Fangda Group Co., Ltd. 2015 Annual Report
Designing,
Shenyang manufacturing,
Shenyang Shenyang 100.00% Incorporation
Decoration and installation of
curtain walls
Installation of
Consolidation of
LED color curtain
Shenzhen Woke Shenzhen Shenzhen 64.58% entities not under
wall, city and
common control
road lamps
Production and Consolidation of
Fangda SOZN Zhongshan Zhongshan sales of light 60.00% entities not under
products common control
Shenzhen Fangda
Property Property
Shenzhen Shenzhen 100.00% Incorporation
Management Co., management
Ltd.
Jiangxi Fangda
Real estate
Property
Nanchang Nanchang development and 100.00% Incorporation
Development Co.,
operation
Ltd.
Ganzhou Design and
Longneng New Ganzhou Ganzhou construction of 100.00% Incorporation
Energy Co., Ltd. PV power plants
Pingxiang Fangda Design and
Luxin New Pingxiang Pingxiang construction of 100.00% Incorporation
Energy Co., Ltd. PV power plants
Pingxiang
Design and
Xiangdong
Pingxiang Pingxiang construction of 100.00% Incorporation
Fangda New
PV power plants
Energy Co., Ltd.
Nanchang Xinjian Design and
Fangda New Nanchang Nanchang construction of 100.00% Incorporation
Energy Co., Ltd. PV power plants
Dongguan Design and
Fangda New Dongguan Dongguan construction of 100.00% Incorporation
Energy Co., Ltd. PV power plants
HK Junjia Hong Kong Hong Kong Investment 100.00% Incorporation
Kechuangyuan Software
Shenzhen Shenzhen 100.00% Incorporation
Software development
Others:
Hong Kong Junjia was liquidated in 2015.
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(2) Major non wholly-owned subsidiaries
In RMB
Dividend to be Interest balance of
Shareholding of minority Profit and loss attributed
Company distributed to minority minority shareholders in
shareholders to minority shareholders
shareholders the end of the period
Shenyang Fangda 35.42% -2,655,608.29 49,731,810.66
Fangda SOZN 40.00% -36,399,621.90 -32,191,155.69
Note to the difference between shareholdings of minority shareholders in subsidiaries and percentage of votes:
Others:
(3) Financial highlights of major non wholly owned subsidiaries
In RMB
Closing balance Opening balance
Compan Non-curr Non-curr Non-curr Non-curr
Current Total of Current Total Current Total of Current Total
y ent ent ent ent
asset assets liabilities liabilities asset assets liabilities liabilities
assets liabilities assets liabilities
Shenyan 11,015,3 96,973,8 107,989, 26,628,4 26,628,4 11,169,3 102,807, 113,977, 25,118,9 25,118,9
g Fangda 01.41 89.70 191.11 49.55 49.55 16.98 842.68 159.66 35.62 35.62
Fangda 86,090,1 17,680,8 103,771, 182,294, 1,954,47 184,248, 98,422,1 24,060,4 122,482, 111,961, 111,961,
SOZN 53.63 88.58 042.21 458.10 3.34 931.44 61.21 01.24 562.45 396.93 396.93
In RMB
Amount occurred in the current period Occurred in previous period
Business Business
Company Total of misc. Total of misc.
Turnover Net profit operation Turnover Net profit operation
incomes incomes
cash flows cash flows
Shenyang -16,384,819.4 -16,384,819.4
-7,497,482.48 -7,497,482.48 -95,859.16
Fangda 3 3
Fangda 148,759,807. -90,999,054.7 -90,999,054.7 95,761,317.8 -13,259,799.7
-6,183,507.98 4,320,158.67 4,320,158.67
SOZN 01 5 5 4 3
Others:
2. Interests in joint ventures or associates
(1) Financial summary of insignificant joint ventures and associates
In RMB
Closing balance/amount occurred in this Opening balance/amount occurred in
period previous period
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China Fangda Group Co., Ltd. 2015 Annual Report
Joint venture: -- --
Total shareholding -- --
Associate: -- --
Total book value of investment 10,489,680.93 11,048,660.43
Total shareholding -- --
Net profit -358,979.50 1,058,094.88
Total of misc. incomes -358,979.50 1,058,094.88
Other note
X. Risks of Financial Tools
Major financial tools of the Group include monetary fund, accounts receivable, receivable bills, other receivables,
other current assets, financial assets measured at fair value and whose change recorded in the profit and loss of
this period, accounts payable, interest payable, payable bills, other payables, short-term borrowings, other current
liabilities, non current liabilities due within one year and long-term borrowings. 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
The target 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 credit risk, liquidity risk and market risk (including interest,
exchange rate and product price/equity tool price risks).
(1) 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 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
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China Fangda Group Co., Ltd. 2015 Annual Report
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 12.92% of the total accounts receivable (2014:
11.26%); among other receivables, other receivables from top 5 customers account for 19.64% of the total other receivables (2014:
27.06%).
(2) 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, 2015,
bank loan credit that the Group has not used was RMB2,493,301,800 (December 31, 2014: 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 114,795.78 114,795.78
Notes payable 30,352.76 30,352.76
Account payable 86,262.17 500.67 86,762.84
Interest payable 324.18 324.18
Other payables 8,267.73 8,267.73
Other current liabilities 9,842.56 9,842.56
Long-term loans 30,039.56 30,039.56
Total liabilities 249,845.18 500.67 30,039.56 280,385.41
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 110,000.00 110,000.00
Notes payable 22,726.65 22,726.65
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China Fangda Group Co., Ltd. 2015 Annual Report
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 1 600.00 600.00
year
Long-term payable 600.00 600.00
Total liabilities 206,427.81 832.30 125.53 207,385.64
(3) 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 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, other current liabilities and long-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. All financial liabilities of the
Group at the end of the period bear fixed interest rates.
The Group pays close attention to the risks of changing interest rates. The Group adopts no hedging policies
currently. The management is responsible for monitoring the interest risks. As fixed deposits are short-term
borrowing, the interest rate risk of the fair value of bank deposit is minor.
On December 31, 2015, 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 RMB25,000.00 (December
31, 2014: 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 Note VII. 53 Foreign Currency Item Note for the Group’s financial assets and liabilities priced in foreign
currencies.
Other price risks
Other price risks refer to risks of fluctuations caused by changes to market prices, regardless of whether the
changes are caused by factors related to a single financial tool or issuer, or factors related to all similar financial
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China Fangda Group Co., Ltd. 2015 Annual Report
tools traded in the market. Other price risks come from changes in product prices or equity tool prices.
Investment in financial assets held by the Group, classified as measured at fair value and whose changes recorded
into the gain and loss in this period is measured at its fair value on the balance sheet date. Therefore, the Group
bears risks of changes in the securities market.
The Group closely follows impacts of price changes to the Company’s securities investment price risks. The
Group takes no measure to prevent other price risks currently.The management is responsible for monitoring the
other price risks.
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, 2015, the Group’s
assets/liability ratio is 70.12% (December 31, 2014: 64.49%).
XI. 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
14,546,206.58 14,546,206.58
tools
2. Leased building 304,615,212.53 304,615,212.53
Total assets measured at
14,546,206.58 304,615,212.53 319,161,419.11
fair value continuously
2. Discontinuous fair
-- -- -- --
value measurement
2. Recognition basis of market value of continuous and discontinuous items measured at first level fair
value
The Group determines the fair value using quotation in an active market for financial instruments traded in an
active market;
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China Fangda Group Co., Ltd. 2015 Annual Report
Valuation technique and qualitative and quantitative information for key parameters of continuous and
discontinuous second level fair value items
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. Switch between different levels, switch reason and switching time policy
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. Fair value of financial assets and liabilities not measured at fair value
Financial assets and liabilities measured at amortized cost include: monetary capital, bills receivable, accounts
receivable, other receivables, short-term borrowings, notes payable, accounts payables, other payables, and
long-term payables.
The difference between book value and fair value of financial assets and liabilities not measured at fair value is
small.
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 3,000.00 9.09% 9.09%
Development Co.,
Ltd.
Shenzhen Shilihe
Shenzhen Industrial investment 1,978.0992 2.36% 2.36%
Investment Co., Ltd.
Shengjiu Investment
Hong Kong Industrial investment HKD1.00 5.00% 5.00%
Ltd.
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.
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China Fangda Group Co., Ltd. 2015 Annual Report
The final controller of the Company is Xiong Jianming.
Others:
2. Subsidiaries of the Company
See Note IX. (1).
3. Joint ventures and associates
Information about other joint ventures or associates with related transactions in this period or with balance
generated by related transactions in previous period:
Joint venture or associate Relationship with the Company
Shenzhen Ganshang Joint Investment Co., Ltd. Associate
Shenzhen Huihai Yirong Internet Service Co., Ltd. Associate
Other note
4. Other associates
Other related parties Relationship with the Company
Directors, manager, CFO and secretary of the Board of Directors Key management
Other note
5. Related transactions
(1) Related leasing
The Company is the leasor:
In RMB
Rental recognized in previous
Name of the leasee Category of asset for lease Rental recognized in the period
period
Shenzhen Ganshang Joint
Houses & buildings 125,213.36 77,354.20
Investment Co., Ltd.
Note to related leasing
(2) Related guarantees
The Company is the guarantor:
In RMB
Beneficiary party Amount guaranteed Start date Due date Completed or not
Fangda New Material 62,000,000.00 27.09.15 27.09.16 No
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China Fangda Group Co., Ltd. 2015 Annual Report
Fangda New Material 80,000,000.00 27.05.15 24.05.16 No
Fangda Automatic 200,000,000.00 24.09.15 23.09.16 No
Fangda Automatic 50,000,000.00 21.10.15 17.09.16 No
Fangda Jianke 710,000,000.00 19.06.15 18.06.16 No
Fangda Jianke 400,000,000.00 17.09.15 16.09.16 No
Fangda Jianke 260,000,000.00 10.10.15 17.09.16 No
Fangda Jianke 200,000,000.00 22.07.15 21.07.16 No
Fangda Jianke 150,000,000.00 22.09.15 22.09.16 No
Fangda Jianke 150,000,000.00 01.01.15 01.01.16 No
Fangda Jianke 45,000,000.00 21.04.15 13.04.16 No
Fangda Property 1,300,000,000.00 03.02.15 02.02.23 No
Fangda SOZN 20,000,000.00 29.01.15 30.01.16 No
The Company is the guarantied party:
In RMB
Guarantor Amount guaranteed Start date Due date Completed or not
Fangda Jianke, Fangda
15,000,000.00 22.09.15 22.09.16 No
Automatic
Fangda Jianke 20,000,000.00 29.10.15 28.10.16 No
Fangda Jianke, Fangda
20,000,000.00 08.09.15 08.09.16 No
New Energy
Note to related guarantees
Note: The above-mentioned guarantees are all associated guarantees within interested entities of the
Group.
(3) Remuneration of key management
In RMB
Items Amount occurred in the current period Occurred in previous period
Directors, supervisors and senior
6,801,794.99 7,089,310.00
management
XIII. Contingent events
1. Contingencies
(1) Significant contingencies on the balance sheet date
1) Contingent liabilities formed by material lawsuit or arbitration, and their influences on the financial position
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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. In June 2015, the court made the first-instance
judgment (2014) Yu 1st Court No.00322. Fangda Jianke is required to pay RMB14,020,443.99 and interest to
Wang Weihong in 10 days upon the effectiveness of the judgment and refund deposit of RMB2,345,000.00 and
interest to Wang Weihong. Fangda Jianke appeal to Supreme People's Court in October 2015. By the report date,
Fangda Jian ke has made the provision of the construction payable, deposit and interest of RMB23,456,800 with
RMB23 million Frozen by the court. In June 2015, Fangda Jianke filed a lawsuit against Wang Weihong,
requiring an indemnity of RMB23 million and de-freezing of the amount RMB23 million by the bank. By the
report date, the lawsuit remains pending.
In 2013, Fangda Jianke filed a lawsuit to Shenyang Middle People’s Court again Shenyang Lidu Commerce Co.,
Ltd., requiring construction payment and loss of RMB9,375,483.47 and the interest. By the report, the
construction quality certificate is in application and the second trial remains pending.
(2) Pending major lawsuits
On January 2, 2003, Guangzhou Middle Court issued a civil case conciliation statement (2002) 穗中法民三初字
No. 00596 to rule that the Guangzhou Yi An Square Real Estate Development Co., Ltd. to make the engineering
payment of RMB5,621,329.63 to Fangda Jianke within 15 days of the effectiveness of the conciliation statement.
By December 31, 2014 , Fangda Jianke has recovered RMB1,950,000.00.
On December 23, 2015, Zhongshan Guzhen People’s Court judged according to 中二法古民二初字第1040号
that Fangda SOZN make the payment of RMB10,331,348.20, interest and the lawsuit fee to Foshan Youfeng
Trading Co., Ltd. within 15 days. By the report date, Fangda SOZN has not made the payment.
(3) Contingent liabilities formed by providing of guarantee to other companies’ debts and their influences on
financial situation
By December 31, 2015, the Group has provided loan guarantees for the following entities:
Name of guaranteed Amount Amount Start date End date Notes
entity
Fangda New Material Guarantee 100.00 2015-5-30 2016-5-30
Fangda New Material Guarantee 2,000.00 2015-11-5 2016-9-27
Fangda New Material Guarantee 10,000.00 2015-6-1 2016-5-27
Fangda Automatic Guarantee 2,000.00 2015-8-28 2016-3-1
Fangda Jianke Guarantee 5,600.00 2015-12-3 2016-12-2
Fangda Jianke Guarantee 2,500.00 2015-2-11 2016-2-11
Fangda Jianke Guarantee 5,000.00 2015-6-29 2016-6-28
Fangda Jianke Guarantee 5,000.00 2015-8-3 2016-8-2
Fangda Jianke Guarantee 5,000.00 2015-8-28 2016-8-27
Fangda Jianke Guarantee 5,000.00 2015-1-16 2016-1-16
Fangda Jianke Guarantee 5,000.00 2015-11-20 2016-11-20
Fangda Jianke Guarantee 5,000.00 2015-7-28 2016-7-28
Fangda Jianke Guarantee 5,000.00 2015-7-30 2016-7-30
Fangda Jianke Guarantee 2,000.00 2015-9-23 2016-9-20
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China Fangda Group Co., Ltd. 2015 Annual Report
Fangda Jianke Guarantee 2,100.00 2015-7-21 2016-1-21
Fangda Jianke Guarantee 5,000.00 2015-8-21 2016-8-20
Fangda Jianke Guarantee 5,000.00 2015-10-30 2016-10-29
Fangda Jianke Guarantee 4,500.00 2015-4-21 2016-4-13
Fangda Property Pledge 2,761.20 2015-2-12 2023-2-11
guarantee
Fangda Property Pledge 7,009.77 2015-4-23 2023-2-11
guarantee
Fangda Property Pledge 4,334.40 2015-6-8 2023-2-11
guarantee
Fangda Property Pledge 426.63 2015-8-11 2023-2-11
guarantee
Fangda Property Pledge 3,525.73 2015-9-11 2023-2-11
guarantee
Fangda Property Pledge 518.82 2015-9-23 2023-2-11
guarantee
Fangda Property Pledge 480.00 2015-10-14 2023-2-11
guarantee
Fangda Property Pledge 3,433.95 2015-11-6 2023-2-11
guarantee
Fangda Property Pledge 545.76 2015-11-20 2023-2-11
guarantee
Fangda Property Pledge 2,388.91 2015-12-9 2023-2-11
guarantee
Fangda Property Pledge 4,614.39 2015-12-28 2023-2-2
guarantee
Fangda SOZN Guarantee 2,000.00 2015-1-29 2016-1-30
Total 107,839.56
Note: Contingent liabilities caused by guarantees provided for other entities are all related guarantees between
interested entities in the Group.
On December 31, 2015, the Company has no other contingent events that should be disclosed.
XIV. Post-balance-sheet events
1. Profit distribution
In RMB
Profit or dividend to be distributed 75,690,990.50
Profit or dividend approved to be distributed 75,690,990.50
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2. Notes to other issues in post balance sheet period
On April 14, 2016, the Company, Fangda New Energy, Fangda SOZN, Shenzhen Jinma Yinke Electronics Co.,
Ltd., Luo Huichi and Jin Yaping (sponse of Luo Huichi) signed the Stock Repurchasing and Debt Pyament
Agreement. For details, see Note XIII.3.
On January 27, 2016, the Company paid RMB20 million to the Henglan branch of BOC to repay the bank loan
borrowed by Fangda SOZN.
On 22.04.16, the Company has no other contingent events that should be disclosed.
XV. Other material events
1. Suspension of operations
In RMB
Suspended
operation profit
Income tax
Items Income Expense Total profit Net profit attributable to the
expenses
owners of parent
company
Suspension of
285,943.62 8,346,179.91 -8,060,236.29 1,119,198.31 -9,179,434.60 -6,522,042.00
operations
Other note
(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 in 2012, the company's
business has been suspended. Fangda Aluminium has been suspended from operating since 2011 and is in the
liquidation process. Hong Kong Junjia was liquidated in 2015.
(2) The net profit from suspended business in 2015 includes: the net profit of RMB-7,502,520.05 of Shenyang
Fangda and its subsidiaries, RMB-1,568,260.36 of Hong Kong Jiajun and RMB-108,654.19 of Fangda
Aluminium.
2. Segment information
(1) Recognition basis and accounting policy for segment report
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;
167
China Fangda Group Co., Ltd. 2015 Annual Report
(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
In RMB
Offset between
Items Curtain wall Rail transport Real estate New energy Others Total
segments
Operation 2,125,881,648. 2,550,467,494.
258,278,535.47 149,151,356.13 29,977,446.65 12,821,491.75
income 28 78
Including:
external 2,121,525,966. 2,550,467,494.
258,246,785.73 149,015,492.60 21,679,249.94
transaction 51 78
income
Inter-segment
transaction 4,355,681.77 31,749.74 135,863.53 8,298,196.71 12,821,491.75
income
Including:
2,104,936,397. 2,492,635,367.
major business 255,752,825.73 136,406,079.32 4,459,934.33
26 98
turnover
1,789,359,293. 2,171,524,200.
Operation cost 202,658,617.93 180,736,929.14 3,788,422.31 5,019,062.15
12 35
Including:
1,773,677,797. 2,135,389,422.
major business 202,170,744.76 164,200,739.52 4,659,859.34
09 03
cost
Operation cost 242,786,794.78 14,389,183.48 9,931,426.21 65,261,777.77 -670,394.04 44,746,350.47 286,952,437.73
Operating
93,735,560.38 41,230,734.06 -9,931,426.21 -96,847,350.78 26,859,418.38 -36,943,920.87 91,990,856.70
profit/(loss)
3,321,292,070. 1,246,929,440. 2,686,258,901. 4,464,147,811.
Total assets 438,339,346.47 180,085,472.66 1,963,760,383.48
11 20 52 40
Total liabilities 2,170,642,731. 210,440,175.37 1,057,358,475. 164,107,950.67 738,414,314.45 1,210,858,920. 3,130,104,726.
168
China Fangda Group Co., Ltd. 2015 Annual Report
15 01 12 53
3. 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. 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.
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. Fangda New Energy shall pay the amount to
Luo Huichi in three installments: The first installment of RMB 6 million shall be paid after both
parties sign the stock transfer agreement, complete the transfer and registration procedures, and
Fangda New Energy 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, Fangda New Energy does not need to
pay the stock transfer amounts to the Counterpart and the 60% shareholding of the Target Company
by Fangda New Energy remains unchanged.
Fangda New Energy will provide loans of RMB30 million to the Fangda SOZN with a mature date
of December 31, 2016 after the share transfer agreement is signed, both parties complete the
commercial and industrial registration, Fangda New Energy holds 60% of Fangda SOZN’s shares.
If Fangda SOZN 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 Fangda SOZN’s shares held by her to the Company at the price of
RMB1/share.
4. Result guaranty
Period Target sales Target net profit
(tax-inclusive)
169
China Fangda Group Co., Ltd. 2015 Annual Report
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
Luo Huichi agrees to sign a three-year labor contract, non-disclosure agreement and
non-competition agreement with Fangda SOZN 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 Fangda SOZN will not distribute profit between July 2014 and December
2016, which will be fully used to push the development of Fangda SOZN.
(2) Performance
Between July and December 2014, Fangda SOZN recorded a tax-included income of
RMB136,832,900 and net profit of RMB521,200, reaching 90% of the sales target for 2014. Fangda
New Energy made the second installment of RMB6 million to Shenzhen Jinma Yinke.
In 2015, Fangda SOZN recorded a tax-included income of RMB174,049,000 and a net profit of
RMB-90,999,100, which does not reach 90% of the sales target or net profit target for 2015.
Therefore, Fangda New Energy does not need to pay the third installment of RMB6 million to
Shenzhen Jinma Yinke. The amount is recognized as non-business income. The interest-free loan
provided to Fangda SOZN of RMB30 million does not need to be transferred to the acquisition
payment. Fangda SOZN shall repay the load to Fangda New Energy upon maturity. Therefore, the
Group transfers RMB12 million back to the minority interest and recognized a non-business income
of RMB12 million.
(3) Share repurchasing and debt payment agreement
On 22.04.16, the Company, Fangda New Energy, Fangda SOZN, Shenzhen Jinma Yinke
Electronics Co., Ltd., Luo Huichi and Jin Yaping (sponse of Luo Huichi) signed the Stock
Repurchasing and Debt Pyament Agreement. According to the agreement, Shenzhen Jinma Yinke
shall pay RMB12 million to repurchase the 60% stake in Fangda SOZN held by Fangda New
Energy and all parties are released from all rights and obligations under the Investment Agreement.
All parties agree, if Fangda SOZN repays the debt of RMB23 million within the agreed period, the
Company and Fangda New Energy shall give up all remaining debt on Fangda SOZN. The
agreement was approved at the 20th meeting of the 7th Board of Directors held on April 22, 2016
and comes into effect after being approved at the Shareholders’ Meeting.
4. Private share issuance
The Group’s private share issuance proposal was approved at the 18th meeting of the 7th Board of
Directors held on November 23, 2015. The Proposal of Private A-share Issuance in 2015 was
approved at the 4th extraordinary shareholders’ meeting held on December 10, 2015. No more than
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China Fangda Group Co., Ltd. 2015 Annual Report
48,000,000 shares will be issued (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 correspondingly.) to raise no more than
RMB469,900,000.
The pricing ex-day is the announcement day of the resolutions of the 18th 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
RMB9.79 per share. The raised fund will be fully used to invest in the Jiangxi Pingxiang Luxi 13
MWp, Jiangxi Pingxiang Xiangdong District 20Mwp and Jiangxi Nanchang Isuzu parking place
roof 6.3MWp distributed PV power generation project and working capital.
On March 9, 2016, the CSRC’s issuance committee reviewed and approved the issuance application.
By the report date, the Company has not received the approval document from CSRC.
XVI. Notes to Financial Statements of the Parent
1. Account receivable
(1) Account receivable disclosed by categories
In RMB
Closing balance Opening balance
Remaining book Remaining book
Bad debt provision Bad debt provision
Type value Book value
Book value
Proportio Provision value Proportio Provision
Amount Amount Amount Amount
n rate n rate
(2) Recognition and
356,660. 10,699.8 345,960.7 527,485
providing of bad debt 100.00% 3.00% 100.00% 15,824.55 3.00% 511,660.60
56 2 4 .15
provisions on groups
356,660. 10,699.8 345,960.7 527,485
Total 100.00% 3.00% 100.00% 15,824.55 3.00% 511,660.60
56 2 4 .15
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
Account receivable Bad debt provision Provision rate
Sub-item of within 1 year
171
China Fangda Group Co., Ltd. 2015 Annual Report
Subtotal for less than 1 year 356,660.56 10,699.82 3.00%
Total 356,660.56 10,699.82 3.00%
Group recognition basis:
Account receivable adopting the balance percentage method in the group
□ Applicable √ Inapplicable
Account receivable adopting other methods in the group:
(2) Bad debt provision made, returned or recovered in the period
A bad debt provision of RMB-5,124.73 was made in the period. RMB0.00 was recovered or reversed.
(3) Balance of top 5 accounts receivable at the end of the period
The total balance of top-five accounts receivable at the end of the period is RMB342,415.38, accounting for 96.01%
of the total remaining balance of all accounts receivable. The bad debt provision made at the end of the period is
RMB10,272.46.
2. Other receivables
(1) Other receivables disclosed by categories
In RMB
Closing balance Opening balance
Remaining book Remaining book
Bad debt provision Bad debt provision
Type value Book value
Book value
Proportio Provision value Proportio Provision
Amount Amount Amount Amount
n rate n rate
Other receivables
with major individual
57,108,4 40,452,1 16,656,29
amount and bad debt 13.71% 70.83%
20.31 27.75 2.56
provision provided
individually
(2) Recognition and
359,478, 543,116. 358,935,0 255,152 548,475.3 254,604,16
providing of bad debt 86.29% 0.15% 99.97% 0.21%
173.41 21 57.20 ,639.18 9 3.79
provisions on groups
Other receivables
with minor individual
77,046.
amount and bad debt 0.03% 77,046.00 100.00%
00
provision provided
individually
172
China Fangda Group Co., Ltd. 2015 Annual Report
416,586, 40,995,2 375,591,3 255,229 625,521.3 254,604,16
Total 100.00% 9.84% 100.00% 0.25%
593.72 43.96 49.76 ,685.18 9 3.79
Other receivables with major individual amount and bad debt provision provided individually at the end of the
period:
√ Applicable □ Inapplicable
In RMB
Other receivables (by Closing balance
entity) Other receivables Bad debt provision Provision rate Reason
Unrecoverable according
Fangda SOZN 57,108,420.31 40,452,127.75 70.83%
to the agreement
Total 57,108,420.31 40,452,127.75 -- --
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 Bad debt provision Provision rate
Sub-item of within 1 year
98,416.60 2,952.50 3.00%
Subtotal for less than 1 year 98,416.60 2,952.50 3.00%
1-2 years 2,619.35 261.94 10.00%
2-3 years 20,000.00 6,000.00 30.00%
Over 3 years 1,067,803.54 533,901.77 50.00%
Total 1,188,839.49 543,116.21 45.68%
Group recognition basis:
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 provision made, returned or recovered in the period
A bad debt provision of RMB40,446,768.57 was made in the period. RMB0.00 was recovered or reversed.
(3) Other receivables are disclosed by nature
In RMB
By nature Closing balance of book value Opening balance of book value
Associate accounts 415,397,754.23 253,944,828.64
173
China Fangda Group Co., Ltd. 2015 Annual Report
Deposit 100,699.54 100,699.54
Other trades 1,088,139.95 1,184,157.00
Total 416,586,593.72 255,229,685.18
(4) Balance of top 5 other receivables at the end of the period
In RMB
Balance of bad debt
Entity By nature Closing balance Age Percentage (%) provision at the end
of the period
Shenzhen Fangda
Property
Associate accounts 216,721,332.99 Less than 1 year 52.02%
Development Co.,
Ltd.
Fangda (Jiangxi)
Property
Associate accounts 99,776,565.00 Less than 1 year 23.95%
Development Co.,
Ltd.
Shihui International
Associate accounts 30,430,197.80 Less than 1 year 7.31%
Holding Co., Ltd.
Shihui International
Associate accounts 20,271.90 1-2 years 0.00%
Holding Co., Ltd.
Guangdong Fangda
SOZN Lighting Co., Associate accounts 57,096,878.05 Less than 1 year 13.71% 40,440,585.49
Ltd.
Guangdong Fangda
SOZN Lighting Co., Associate accounts 11,542.26 1-2 years 0.00% 11,542.26
Ltd.
Shenyang Fangda
Semi-conductor Associate accounts 36,000.00 Less than 1 year 0.01%
Lighting Co., Ltd.
Shenyang Fangda
Semi-conductor Associate accounts 6,906,771.58 1-2 years 1.66%
Lighting Co., Ltd.
Total -- 410,999,559.58 -- 98.66% 40,452,127.75
3. Long-term share equity investment
In RMB
Items Closing balance Opening balance
174
China Fangda Group Co., Ltd. 2015 Annual Report
Remaining book Impairment Remaining book Impairment
Book value Book value
value provision value provision
Investment in
1,013,991,568.20 56,780,600.00 957,210,968.20 1,166,555,998.58 46,930,100.00 1,119,625,898.58
subsidiaries
Investment in
associates and 10,489,680.93 10,489,680.93 11,048,660.43 11,048,660.43
joint ventures
Total 1,024,481,249.13 56,780,600.00 967,700,649.13 1,177,604,659.01 46,930,100.00 1,130,674,559.01
(1) Investment in subsidiaries
In RMB
Balance of
Provision made in impairment
Invested entity Opening balance Increase Decrease Closing balance
this period provision at the
end of the period
Fangda Jianke 491,950,000.00 491,950,000.00
Fangda
19,800,000.00 19,800,000.00 19,800,000.00
Aluminium
HK Junjia 10,600.00 10,600.00
Fangda Automatic 170,385,071.73 151,553,830.38 18,831,241.35
Fangda New
74,496,600.00 74,496,600.00
Material
Shenyang Fangda 108,852,073.85 108,852,073.85 9,861,100.00 36,980,600.00
Kexunda 1,000,000.00 1,000,000.00 0.00
Fangda Property 200,000,000.00 200,000,000.00
Shihui
International 61,653.00 61,653.00
Holding Co., Ltd.
Fangda New
100,000,000.00 100,000,000.00
Energy
Total 1,166,555,998.58 152,564,430.38 1,013,991,568.20 9,861,100.00 56,780,600.00
(2) Investment in associates and joint ventures
In RMB
Change (+,-) Balance
Invested Opening Closing
Increased Decrease Investme Other Other Cash Impairme of
entity balance Others balance
investmen d nt gain miscellan equity dividend nt impairme
175
China Fangda Group Co., Ltd. 2015 Annual Report
t investmen and loss eous change or profit provision nt
t recognize income announce provision
d using adjustmen d at the end
the equity t of the
method period
1. Joint venture
2. Associate
Shenzhen
Ganshang
Joint 11,048,66 -337,462. 2,200,000 8,511,197
Investme 0.43 45 .00 .98
nt Co.,
Ltd.
Shenzhen
Huihai
Yirong 2,000,000 -21,517.0 1,978,482
Internet .00 5 .95
Service
Co., Ltd.
11,048,66 2,000,000 -358,979. 2,200,000 10,489,68
Subtotal
0.43 .00 50 .00 0.93
11,048,66 2,000,000 -358,979. 2,200,000 10,489,68
Total
0.43 .00 50 .00 0.93
4. Operational revenue and costs
In RMB
Amount occurred in the current period Occurred in previous period
Items
Income Cost Income Cost
Other businesses 29,977,446.65 3,788,422.31 29,609,371.13 5,669,281.13
Total 29,977,446.65 3,788,422.31 29,609,371.13 5,669,281.13
Others:
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 -358,979.50 1,054,094.88
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China Fangda Group Co., Ltd. 2015 Annual Report
measured by equity
Investment gain obtained from disposal of
10,600.00
long-term equity investment
Others 55,961.64 111,670.20
Total -292,417.86 29,805,392.25
XVII. Supplementary Materials
1. Detailed accidental gain/loss
√ Applicable □ Inapplicable
In RMB
Items Amount Notes
Gain/loss of non-current assets -522,948.72
Subsidies accounted into the current income
account (except the government subsidy
closely related to the enterprise’s business 2,246,386.84
and based on unified national standard
quota)
Gain from entrusted investment or assets
250,897.54
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 4,341,316.92
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 85,793,780.49
in follow-up measurement
Other non-business income and expenditures
7,624,429.39
other than the above
Less: Influenced amount of income tax 20,963,417.56
Influenced amount of minority
568,368.77
shareholders’ equity
Total 78,202,076.13 --
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.
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China Fangda Group Co., Ltd. 2015 Annual Report
□ Applicable √ Inapplicable
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
8.42% 0.14 0.14
shareholders of the Company
Net profit attributable to the
common owners of the PLC after
2.28% 0.04 0.04
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
√ Applicable □ Inapplicable
In RMB
Net profit Net assets
Amount occurred in the Occurred in previous
Closing balance Opening balance
current period period
On Chinese accounting
107,272,369.77 96,998,429.76 1,319,496,334.84 1,234,930,863.46
standards
Items and amounts adjusted according International Accounting Standards:
On international
107,272,369.77 96,998,429.76 1,324,259,733.08 1,239,694,261.70
accounting standards
(2) Differences in net profits and assets in financial statements disclosed according to the international and
Chinese account standards
□ Applicable √ Inapplicable
(3) Differences in financial data using domestic and foreign accounting standards, the overseas institution
name should be specified if the difference in data audited by an overseas auditor is adjusted
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.
178
China Fangda Group Co., Ltd. 2015 Annual Report
179
China Fangda Group Co., Ltd. 2015 Annual Report
Chapter 11 Documents for Reference
1. The Annual Report 2015 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.
China Fangda Group Co., Ltd.
Legal representative: Xiong Jianming
April 26, 2016
180
