东沣科技集团股份有限公司 2018 年年度报告全文
东沣科技集团股份有限公司
Dongfeng Sci-Tech Group CO., Ltd.
ANNUAL REPORT 2018
April 2019
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东沣科技集团股份有限公司 2018 年年度报告全文
Section I. Important Notice, Contents and Paraphrase
Board of Directors, Supervisory Committee, all directors, supervisors and senior
executives of Dongfeng Sci-Tech Group CO., Ltd. (hereinafter referred to as the
Company) hereby confirm that there are no any fictitious statements, misleading
statements, or important omissions carried in this report, and shall take legal
liability, individual and/or joint, for the whole contents.
Zhao Yongsheng, Principal of the Company, Zhao Yongsheng, person in charger
of accounting works and Liu Fengguo, person in charge of accounting organ
(accounting principal) hereby confirm that the Financial Report of 2018 Annual
Report is authentic, accurate and complete.
All directors are attended the Board Meeting for report deliberation.
The Company has no plan of cash dividends carried out, bonus issued and
capitalizing of common reserves either.
Note: The Report is prepared in bilingual versions of Chinese and English
respectively, in the event of any discrepancy in understanding the two
aforementioned versions, the Chinese version shall prevail.
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东沣科技集团股份有限公司 2018 年年度报告全文
Contents
Section I. Important Notice, Contents and Paraphrase ................................................................. 2
Section II. Company Profile and Main Financial Indexes ............................................................. 5
Section III. Summary of Company Business ................................................................................. 10
Section IV. Discussion and Analysis of the Business ..................................................................... 12
Section V. Important Event ............................................................................................................. 33
Section VI. Changes in Shares and Particulars about Shareholders .......................................... 45
Section VII. Preferred Stock ........................................................................................................... 52
Section VIII. Particulars about Directors, Supervisors, Senior Executives and Employees .... 53
Section IX. Corporate Governance ................................................................................................ 61
Section X. Corporation bonds ......................................................................................................... 71
Section XI. Financial Report ........................................................................................................... 72
Section XII. Documents available for reference .......................................................................... 201
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东沣科技集团股份有限公司 2018 年年度报告全文
Paraphrase
Items Refers to Contents
CSRC, SRC Refers to China Securities Regulatory Commission
SZ Stock Exchange, Exchange Refers to Shenzhen Stock Exchange
Company, The Company Refers to Dongfeng Sci-Tech Group CO., LTD.
Dongfeng Investment Refers to Chengde Dongfeng Investment Co., Ltd.
Kefeng Trading Refers to Chengde Kefeng Trading Co., Ltd.
Kefeng Engineering Refers to Chengde Kefeng Engineering Project Management Co. Ltd.
Nanjiang Trading Refers to Chengde Nanjiang Trading Co., Ltd.
Nanjiang Technology Refers to Chengde Nanjiang Technology Co. Ltd.
Ecological Agriculture Refers to Chengde Dongfeng Ecological Agriculture Co., Ltd.
Asia Investment, Nanjiang Asia Refers to Nanjiang Asia Investment Co., Ltd.
Runhua RW Refers to Runhua Rural Water (Tianjin) International Trade Co., Ltd.
Hangzhou Dongfeng Refers to Hangzhou Dongfeng Technology Co. Ltd.
Dongfeng Technology Development Refers to Dongguan Dongfeng Technology Development Co., Ltd.
Dongfeng Intelligent Refers to Dongguan Dongfeng Intelligent Technology Co., Ltd.
Zhongchuang New Energy Refers to Dongguan Zhongchuang New Energy Technology Co., Ltd.
Aolin New Materials Refers to Dongguan Aolin New Materials Co., Ltd.
Haizhuo Energy Refers to Dongguan Haizhuo Energy Technology Co., Ltd.
Huijing Property Refers to Chengde Huijing Property Services Co., Ltd.
Dongfeng Power Refers to Dongguan Dongfeng Power Tech. Co., Ltd.
Company Law Refers to Company Law of the People’s Republic of China
Securities Law Refers to Securities Law of the People’s Republic of China
Rules Governing the Listing of Securities on Shenzhen Stock
Listing Rules Refers to
Exchange
Yuan, 10 thousand Yuan Refers to RMB, RMB 10 thousand
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东沣科技集团股份有限公司 2018 年年度报告全文
Section II. Company Profile and Main Financial Indexes
I. Company information
Short form of the stock Dongfeng-B Stock code 200160
Short form of the Stock after
N/A
changed (if applicable)
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in
东沣科技集团股份有限公司
Chinese)
Short form of the Company
东沣 B
(in Chinese)
Foreign name of the
DongfengSci-Tech Group CO.,LTD
Company(if applicable)
Short form of foreign name of
DONGFENG-B
the Company(if applicable)
Legal representative Zhao Yongsheng
Registrations add. XiaBanCheng Town, Chengde County, Hebei Province, P.R.C
Codes for office add. 067400
Offices add. XiaBanCheng Town, Chengde County, Hebei Province, P.R.C
Codes for office add. 067400
Website --
E-mail dfjt@dftechgroup.com
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Li Wenying Wang Haijian
XiaBanCheng Town, Chengde County, XiaBanCheng Town, Chengde County,
Contact add.
Hebei Province Hebei Province
Tel. 0314-3115048 0314-3115048
Fax. 0314-3111475 0314-3111475
E-mail liwy@dftechgroup.com wanghj@dftechgroup.com
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东沣科技集团股份有限公司 2018 年年度报告全文
III. Information disclosure and preparation place
Media appointed for information disclosure In China: Securities Times; overseas: Hong Kong Commercial Daily
Website for annual report publish appointed by CSRC Juchao website: http://www.cninfo.com.cn
Preparation place for annual report Security department of the Company
IV. Registration changes of the Company
Organization code 911308001065768766
Changes of main business since listing (if
No changes
applicable)
Previous changes for controlling
No changes
shareholders (if applicable)
V. Other relevant information
CPA engaged by the Company
Name of CPA Dahua Certified Public Accountants (Limited Liability Partnership)
Offices add. for CPA No. 689, Tianhe Road (N), Guangzhou
Signing Accountants Hu Zhigang, Yan Lisheng
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
VI. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data
□ Yes √ No
2018 2017 Changes over last year 2016
Operating income (RMB) 123,508,083.90 250,071,863.07 -50.61% 367,898,631.53
Net profit attributable to
shareholders of the listed company 7,383,835.76 4,102,325.89 79.99% 3,760,806.51
(RMB)
Net profit attributable to
shareholders of the listed company
-12,564,268.78 -49,734,326.42 74.74% 553,720.92
after deducting non-recurring gains
and losses (RMB)
Net cash flow arising from
34,566,049.31 -84,551,574.28 140.88% 54,484,351.33
operating activities (RMB)
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东沣科技集团股份有限公司 2018 年年度报告全文
Basic earnings per share
0.01 0.01 0.00% 0.01
(RMB/Share)
Diluted earnings per share
0.01 0.01 0.00% 0.01
(RMB/Share)
Weighted average ROE 2.01% 1.13% 0.88% 1.06%
Changes over end of
End of2018 End of2017 End of2016
last year
Total assets (RMB) 624,370,817.40 503,762,445.04 23.94% 626,756,827.34
Net assets attributable to
shareholder of listed company 351,593,999.08 363,928,776.87 -3.39% 359,826,450.98
(RMB)
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International
Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or
Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VIII. Quarterly main financial index
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 57,256,600.57 22,559,268.21 15,883,771.67 27,808,443.45
Net profit attributable to
1,206,225.64 -6,416,983.86 8,356,632.89 4,237,961.09
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
-1,688,014.85 -6,527,892.79 -10,105,275.24 5,756,914.10
after deducting non-recurring gains
and losses
Net cash flow arising from
13,873,390.65 20,051,902.37 -9,019,953.54 9,660,709.83
operating activities
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东沣科技集团股份有限公司 2018 年年度报告全文
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in the company’s quarterly report and semi-annual report
□Yes √ No
IX. Items and amounts of extraordinary profit (gains)/loss
√Applicable □ Not applicable
In RMB
Item 2018 2017 2016 Note
Gains/losses from the disposal of
non-current asset (including the write-off 4,526,245.58 65,016,094.13 4,800,704.58 ---
that accrued for impairment of assets)
Tax return, reduction and exemption with
unauthorized approval or without formal
approval documents
Governmental subsidy reckoned into current
gains/losses (not including the subsidy
enjoyed in quota or ration according to 2,896,000.00 94,100.26
national standards, which are closely
relevant to enterprise’s business)
Held transaction financial asset, gains/losses
of changes of fair values from transaction
financial liabilities, and investment gains
from disposal of transaction financial asset, Income from financial
1,144,246.03
transaction financial liabilities and financial products
asset available for sales, exclude the
effective hedging business relevant with
normal operations of the Company
Custodial fee income from trusteeship
Other non-operating income and expenditure
-470,819.42 -754,839.79 -618,690.72
except for the aforementioned items
Gain/losses items qualified definition of the
18,501,800.54 2,482,382.07 Subsidiary disposal
extraordinary gains/losses
Less: Impact on income tax 6,649,368.19 12,906,984.10 1,069,028.53
Impact on minority shareholders’ equity
(post-tax)
Total 27,858,178.45 53,836,652.31 3,207,085.59 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
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东沣科技集团股份有限公司 2018 年年度报告全文
Securities to the Public --- Extraordinary Profit/loss, explain reasons
□ Applicable √ Not applicable
In reporting period, the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of
extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to
the Public --- Extraordinary Profit/loss
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东沣科技集团股份有限公司 2018 年年度报告全文
Section III. Summary of Company Business
I. Main businesses of the company in the reporting period
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
I. Main business operations during the reporting period
Real estate business: the real estate development business was the main operating business of the Company during
the reporting period, and the business model was the development and sales of commercial housing, and the
business scope was mainly located in Chengde area.The main products were residence and commerce. With
high-quality product quality and property services, the company’s real estate business had established a good
reputation in the local area.
On the basis of ensuring the steady development of real estate business, the company actively promoted the
strategic transformation of the hydrogen energy and new materials sectors. The progress of main business during
the reporting period was as follows:
Hydrogen fuel cell business: with Dongguan Zhongchuang New Energy as the business platform, the Company
mainly engaged in the R&D, production and sales of fuel cell core raw materials (membrane electrodes) and fuel
cell power systems, as well as providing integrated solutions for platforms such as fuel cell power systems in
automobiles, drones, electric forklifts, distributed power stations, and emergency power supplies. At present,
500W to 5000W series air-cooled fuel cell pile (graphite bipolar plates) have been finalized for production, and
the mass power density of the pile is above 500W/kg, which is in small batch production and sales.
For the hydrogen energy business, the company took Haizhuo Energy as its business platform, mainly engaged in
research and development, production and sales of real-time hydrogen production equipment. The real-time
hydrogen production equipment research by the Haizhuo Energy consists of on-board hydrogen generator and
hydrogen fuel cell. At present, the real-time hydrogen production equipment has been successfully tested on
hydrogen fuel cell buses and is undergoing road test.
New material business: with Aolin New Materials as its business platform, the Company mainly engaged in the
research & development, production and sales of high-performance ceramic fiber materials, its main products
were alumina fiber and zirconia fiber, which possess with excellent thermal insulation, energy saving, fire
resistance, and fireproof performance and can be widely used in industrial furnace wall lining, backing, lining,
pipe insulation, thermal insulation and sealing (automobile gasket), radiation and heat insulation of petrifaction,
metallurgy, non-ferrous metals, building materials, electric power, machinery, ceramics, glass, shipping and other
industries. At present, the initial production line of alumina short fiber, researched and developed by Aolin New
Materials was completed, and have entered the small batch production and sales.
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东沣科技集团股份有限公司 2018 年年度报告全文
II. Main performance drivers
During the reporting period, due to the tightening of regulatory policies, the tightening policies in the real estate
market such as purchase restrictions, limited loans, and price limits were frequent, and the real estate market in
Beijing-surrounded areas has stabilized. The Company’s real estate development has been mainly located in the
Chengde area, and the opening of the Beijing-Shenyang high-speed railway shall make Chengde enter the
―one-hour economic circle of the capital‖ and thus has better regional advantages. In recent years, the real estate
projects developed by the Company have established a good reputation and brand image in the local area with
excellent quality and perfect property management. In the future, under the background of Beijing-Tianjin-Hebei
integration, the Company will continue to improve service quality, build high-end boutique houses, and improve
market competitiveness. Meanwhile, we proactively promoted the strategy transformation and fostering new profit
growth points for the Company.
II. Major changes in main assets
1. Major changes in main assets
Major assets Note of major changes
Fixed assets Increased 78.85%, mainly because purchased fixed assets in the period
Construction in process Increased 4383.61%, mainly because new construction in process increased in the period
2. Main overseas assets
□ Applicable √ Not applicable
III. Core Competitiveness Analysis
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
1. Team advantages. The company has an excellent management team who has an acute sense of market judgment, efficient
decision-making and executive capacity, rich management experience, strong adaptability and innovation ability, and is strong
backing to protect the company's development and promote the company's strategic transformation.
2. Brand advantages. The company has strictly controlled the quality, built high-quality and high-level residences, established a good
corporate image and reputation by precisely positioning the market.
3. Location advantage. The Company locates in Chengde, and adjacent to Beijing and Tianjin, which has a favorable location under
the background of ―integration of Beijing-Tianjin-Hebei regions‖.
4. Technical advantage: the Company cooperate with the Dongguang Beihang Institution in respect of hydrogen energy and new
materials, and owes a technical advantage in field of hydrogen energy and new materials
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东沣科技集团股份有限公司 2018 年年度报告全文
Section IV. Discussion and Analysis of the Business
I. Introduction
The Company needs to comply with the disclosure requirement of Shenzhen Stock Exchange Industry Information Disclosure
Guidelines No.3- Listed Companies Engaging in Real Estate Business
(I) Analysis of the industry situation during the reporting period
During the reporting period, the real estate policy continued the main tone of ―housing is for residence instead of
vicious speculation‖, various control policies were mainly stable, and more emphasis was placed on urban policy,
rational policy and structural optimization. Under the guidance of classification and regulation, local policies
continued to be overweight and continue to implement differentiated regulation and control. At the same time, it
paid attention to the adjustment of housing supply structure, vigorously developed affordable housing such as
housing rental market and shared property housing, increased the proportion of effective supply, and established a
sound and stable long-term mechanism for industrial development. According to the statistics of the Hebei
Provincial Bureau of Statistics, in 2018, the investment in real estate development in Hebei Province was 447.64
billion yuan, declined by 7.2% on a year-on-year basis, the sales area of commercial housing was 52.519 million
square meters, a decline of 18.3% on a year-on-year basis, and the area of commercial housing for sale was 9.181
million square meters, a decline of 13.1% on a year-on-year basis, the real estate development and sales continued
to cool down, and the de-stocking was better.
(II) Operation of the company during the reporting period
During the reporting period, under the background of the downturn pressure on the international and domestic
economy and the strict regulation of real estate, the company adhered to the development idea of ―real estate +
strategic transformation‖ and utilized the company’s good reputation in the local area to develop the real estate
business, and meanwhile accelerated the process of the company’s strategic transformation business.
In terms of real estate, during the reporting period, the company responded to market changes on the one hand,
increased sales efforts, and accelerated the destocking of stocks; on the other hand, strictly controlled quality,
focused on the development of new real estate projects – Tianxi Project, covering an area of 25,128.90 square
meters, the construction period would continue until 2020.
In terms of hydrogen energy and new materials, we accelerated the construction of the Dongfeng New Energy
Equipment Industrialization Base project. During the reporting period, some businesses achieved breakthrough
progress. The first production line for alumina short fiber based on Aolin New Materials has been completed and
started to be put into production and sales in small batches. At present, the market is being vigorously developed,
and at the same time, product performance is upgraded according to customer demand, productivity is increased,
and cost is further reduced. The mass production of this product will effectively fill the market gap of domestic
high-end alumina fiber; the real-time hydrogenation equipment developed by Haizhuo Energy has been
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东沣科技集团股份有限公司 2018 年年度报告全文
successfully tested on hydrogen fuel cell buses, and road test experiments are being carried out, and the product
performance is further improved and upgraded. The successful experiment of real-time hydrogenation equipment
enables large vehicles such as hydrogen fuel cell bus, bus, and logistics vehicles not to carry high-pressure
hydrogen cylinders and can be operated without relying on hydrogenation at the hydrogen fueling station, you
only need to add water and solid hydrogen fuel rods to the real-time hydrogenation equipment at regular intervals
and the equipment supplies hydrogen according to the needs of fuel cell. And the real-time hydrogenation
equipment produces hydrogen as needed, it does not produce hydrogen at the idle hours, nor store hydrogen, and
the safety is improved significantly. The hydrogen fuel cell with Zhongchuang New Energy as the platform has
formed a 500W to 5000W series fuel cell stack (graphite bipolar plate) production, the power density of the stack
is above 500W/kg, and small batch production and sales are underway.
1. During the reporting period, the company’ real estate development was as follows:
Estimated
Actual
Calculated Completed investment
Project under invested
Area Equity ratio Start-up time Floor space building area building area amount
construction amount(hundre
(m2) (m2) (hundred
d million yuan)
million yuan)
Tianxi Chengde 100% 2018.10 25,128.9 43472 0 3.8 1.08
2. During the reporting period, the company’s real estate sales were as follows:
Saleable area
Gross
at the Pre-sale Settlement area
Project Type of Operating income Operating cost profit
Area beginning of area in current in current
name operation (RMB) (RMB) margin (%)
the period(m2) period(m2) period(m2)
Residence 11242.07 5971.82 17268.34 76538629.46 61453486.74 19.71%
Nanjiang
–Huijing Chengde Commerce 14190.11 12118.77 10819.78 42269090.47 42367762.05 -0.23%
Tiandi
Total 25432.18 18090.59 28088.12 118807719.93 103821248.79 12.61%
3. During the reporting period, the company did not have any new land reserves:
4. During the reporting period, the company provided guarantees to its commercial housing purchasers for bank
mortgage loans:
As of the end of the reporting period, the balance of guarantees provided by the company for commercial house
purchasers for bank mortgage loans was 70.74 million yuan. During the reporting period, there was no guarantee
for this guarantee and the amount involved accounting for 10% of the company’s latest audited net profit.
5. Progress of equipment industrialization base project of Dongfeng New Energy:
The No. 1-9 factory buildings of Dongfeng New Energy equipment industrialization base has been fully capped,
the interior and exterior wall decoration, floor, elevator, doors and windows, bathroom and other decorative
projects have been completed, and the outdoor pipelines in the factory have been pre-buried.
Scientific research building: The exterior wall tile, doors and windows of Zone A and Zone C have been
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东沣科技集团股份有限公司 2018 年年度报告全文
completed, and the stairwell decoration and elevator installation are being carried out; the masonry project in
Zone B has been completed and the interior and exterior walls are being plastered. The overall project is expected
to be completed and accepted in the third quarter of 2019.
6. During the reporting period, the company’s financing situation was as follows:
Credit amount (ten Financing balance
Financing category Financing cost Financing period
thousand yuan) (ten thousand yuan)
Bank loan 20000 20000 7.105% 5 years
7. Stock repurchase of the company
Due to the influence of multiple factors, the company’s share price fluctuated greatly and even dropped below the
face value during the reporting period. In order to boost investors’ confidence and safeguard the interests of the
company’s shareholders, especially the majority of small and medium shareholders, the company
comprehensively considered its operation, financial status and development strategy, at the same time, based on
the confidence in the company’s future stable development prospects and the recognition of the company’s
long-term investment value, the company held the second extraordinary shareholders meeting in 2018 on
November 7, 2018 to consider and approve the matter of repurchasing the company’s shares by means of
centralized bidding. As of the disclosure date of this report, the number of shares repurchased by the company
through the stock repurchase special securities accounts by centralized bidding was 28,307,783 shares, accounting
for 4.01% of the company’s total share capital, of which the highest transaction price was HK$1.18 per share, the
lowest transaction price was HK$1.09 per share, and the total amount paid was HK$32,095,614.32 (excluding
transaction fees). See the table below for details:
Proportion
Highest Repurchase
Repurcha Repurchase Lowest price in total
price amount Announcement index
se date quantity (HKD) share
(HKD) (HKD)
capital
Announcement on the
First Repurchase of
2018.12.6 6,586,658 1.14 1.11 7,449,626.48 0.93%
Company Shares
2018-070
Announcement on
Proportion of
Repurchase of
2018.12.2
12,864,055 1.14 1.09 14,529,142.54 1.82% Company Shares
0
Amounting to 2% of
the Total Share
Capital 2018-075
Announcement on
Proportion of
2018.12.2
4,994,970 1.18 1.12 5,697,753.10 0.71% Repurchase of
7
Company Shares
Amounting to 3% of
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东沣科技集团股份有限公司 2018 年年度报告全文
the Total Share
Capital ―2018-076‖
2018.12.2 Announcement on
532,100 1.14 1.14 606,594.00 0.08%
8 Proportion of
Repurchase of
Company Shares
2019.1.29 3,330,000 1,16 1.14 3,812,498.20 0.47% Amounting to 4% of
the Total Share
Capital 2019-006
Total 28,307,783 32,095,614.32 4.01%
II. Main business analysis
1. Introduction
See the ―I-Introduction‖ in ―Discussion and Analysis of the Business‖
2. Revenue and cost
(1) Constitute of operation revenue
In RMB
2018 2017
Ratio in operation Ratio in operation Y-o-y changes (+,-)
Amount Amount
revenue revenue
Total operation
123,508,083.90 100% 250,071,863.07 100% -50.61%
revenue
According to industries
Real estate 118,807,719.93 96.19% 244,805,702.13 97.89% -51.47%
Property
4,582,079.48 3.71% 3,855,595.87 1.54% 18.84%
management
Agriculture 118,284.49 0.10% 1,410,565.07 0.56% -91.61%
According to products
Sales of real estate 118,807,719.93 96.19% 244,805,702.13 97.89% -51.47%
Heating, property 4,582,079.48 3.71% 3,855,595.87 1.54% 18.84%
Agriculture 118,284.49 0.10% 1,410,565.07 0.56% -91.61%
According to region
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东沣科技集团股份有限公司 2018 年年度报告全文
Chengde 123,508,083.90 100.00% 250,071,863.07 100.00% -50.61%
(2) About the industries, products, or regions accounting for over 10% of the company’s operating income
or operating profit
√Applicable □ Not applicable
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
In RMB
Increase/decrease Increase/decrease Increase/decrease
Operating
Operating cost Gross profit ratio of operating of operating cost of gross profit
revenue
revenue y-o-y y-o-y ratio y-o-y
According to industries
Real estate 118,807,719.93 103,821,248.79 12.61% -51.47% -55.17% 7.20%
According to products
Sales of real
118,807,719.93 103,821,248.79 12.61% -51.47% -55.17% 7.20%
estate
According to region
Chengde 123,508,083.90 108,747,731.24 11.95% -50.61% -54.15% 6.80%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main business based on
latest one year’s scope of period-end
□ Applicable √ Not applicable
(3) Income from physical sales larger than income from labors
□Yes √No
(4) Fulfillment of the company’s signed significant sales contracts up to this reporting period
□ Applicable √ Not applicable
(5) Constitute of operation cost
Industry and Product classification
In RMB
2018 2017
Industry Increase/decrease
Item Ratio in operation Ratio in operation
classification Amount Amount y-o-y
cost cost
Real estate Real estate 103,821,248.79 95.47% 231,565,613.02 97.63% -55.17%
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东沣科技集团股份有限公司 2018 年年度报告全文
industry
Property Property
4,818,262.48 4.43% 4,964,668.31 2.09% -2.95%
management management
Agriculture and Agriculture and
108,219.97 0.10% 652,858.34 0.28% -83.42%
others others
In RMB
2018 2017
Product Increase/decrease
Item Ratio in operation Ratio in operation
classification Amount Amount y-o-y
cost cost
Sales of real Sales of real
103,821,248.79 95.47% 231,565,613.02 97.63% -55.17%
estate estate
Heating, property Heating, property 4,818,262.48 4.43% 4,964,668.31 2.09% -2.95%
Agriculture and Agriculture and
108,219.97 0.10% 652,858.34 0.28% -83.42%
others others
Other explanation
(6) Whether the changes in the scope of consolidation in Reporting Period
√ Yes □ No
1. Subsidiary newly included in consolidation scope
Name Causes
Dongfeng Power Enterprise combined under the same control
Haizhuo Energy Enterprise combined under the different control
2. Subsidiary excluded in the consolidation scope in the period
Name Causes
Nanjiang Trading Disposal
(1) The Company transferred its 100% equity of NanjiangTrading to Chengde Country Jinshangmao Co., Ltd on August 14, 2018,
therefore, Nanjiang Trading was no longer included in the consolidated balance sheet in the current period, but the Accounting
Standards for Business Enterprises No. 33 – Consolidated Financial Statements stipulates that if a parent company disposes of a
subsidiary during the reporting period, the income, expenses and profits of the subsidiary from the beginning of the period to the
disposal date should be included in the consolidated income statement, and the cash flows of the subsidiary from the beginning of the
period to the disposal date should be included in the consolidated cash flow statement. Therefore, the income, expenses and profits of
NanjiangTrading from the beginning of the current period to the date of cancellation were still included in the scope of consolidation.
(2) Dongguan Dongfeng Power Tech. Co., Ltd. is a holding sub-subsidiary acquired on August 28, 2018. On December 25, 2018,
Dongguan Dongfeng Tech. transferred it to the Company to become a holding subsidiary.
(3) Dongguan Haizhuo Energy Technology Co., Ltd. is a holding sub-subsidiary that increased its capital and shares on March 6,
2018.
17
东沣科技集团股份有限公司 2018 年年度报告全文
(7) Major changes or adjustment in business, product or service of the Company in Reporting Period
□ Applicable √ Not applicable
(8) Major sales and main suppliers
Major sales client of the Company
Total sales from top five clients (RMB) 42,920,866.61
Ratio of the total sales from top five clients in total
34.75%
annual sales
Ratio of the amount of related party’s sales in top five
0.00%
clients in total annual sales
Top five clients of the Company
Serial Name Sales (RMB) Proportion in total annual sales
1 Client I 34,443,952.34 27.89%
2 Client II 3,809,523.80 3.08%
3 Client III 1,828,571.43 1.48%
4 Client IV 1,646,057.14 1.33%
5 Client V 1,192,761.90 0.97%
total -- 42,920,866.61 34.75%
Other situation of main clients
□ Applicable √ Not applicable
Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 283,081,773.37
Ratio of the total purchase from top five suppliers in
96.73%
total annual purchase amount
Ratio of the amount of related party’s purchase in top
0.00%
five suppliers in total annual purchase amount
Top five suppliers of the Company
Serial Supplier Purchasing amount (RMB) Ratio in total annual purchasing amount
1 Supplier I 215,010,000.00 73.47%
2 Supplier II 60,038,761.00 20.52%
3 Supplier III 3,139,474.27 1.07%
18
东沣科技集团股份有限公司 2018 年年度报告全文
4 Supplier IV 2,661,689.10 0.91%
5 Supplier V 2,231,849.00 0.76%
Total -- 283,081,773.37 96.73%
Other notes of main suppliers of the Company
□ Applicable √ Not applicable
3. Expenses
In RMB
Increase/decrease
2018 2017 Note of major changes
y-o-y
Agency charges accrual in advance in
Sales expense 115,346.71 14,417,090.26 -99.20%
the period
Management expense 29,236,648.47 29,552,371.61 -1.07%
Interests expenses declined in the
Financial expense -385,552.98 1,346,177.29 -128.64%
period
Expenses from R&D increased in the
R&D expense 4,748,852.86 124,889.69
3702.44% period
4. R&D investment
√Applicable □ Not applicable
During the reporting period, the company continued to increase R&D investment in hydrogen energy and new materials related
projects, the main investment projects included hydrogenation equipment, ceramic short fiber and hydrogen fuel cell projects, with a
total investment of RMB 14,581,700. During the reporting period, the company’s hydrogen energy and new materials business made
great progress, and the first production line of alumina short fiber was completed and started to be put into production and sold in
small batches. The real-time hydrogenation equipment has been successfully tested on the hydrogen fuel cell bus, and further road
test experiments are underway. The hydrogen fuel cell has formed a 500W to 5000W series fuel cell stack (graphite bipolar plate)
production, the power density of stack is above 500W/kg, and small batch production is underway, which further promoted the
industrialization and marketization of the company’s hydrogen energy and new materials business.
Investment for R&D
2018 2017 Ratio of changes
Number of R&D personnel
47 21 123.81%
(person)
The proportion of R&D
25.97% 14.69% 11.28%
personnel
Funds invested for R&D
14,581,701.77 3,638,451.25 300.77%
(RMB)
The ratio of R&D investment to
11.81% 1.45% 10.36%
operation revenue
19
东沣科技集团股份有限公司 2018 年年度报告全文
Capitalization of the investment
13,346,410.47 3,513,561.56 279.85%
for R&D (RMB)
The ratio of capitalization of the
investment for R&D to R&D 91.53% 96.57% -5.04%
investment
As for the obvious changes of the ratio of total R&D amount to operation revenue over that of last year, explain the causes
√Applicable □ Not applicable
During the year, the company added R&D investment in hydrogenation equipment, and increased investment in the original R&D
projects, which significantly increased the R&D investment in the current period compared with the previous year, but the sales of
real estate development projects decreased in the current period compared with the previous year, resulting in a sharp decrease in the
operating income compared with the previous year, as a result, the proportion of total R&D investment in the operating income has
changed significantly compared with the previous year.
As for the major changes of capitalization rate of the R&D investment, explain the causes and reasonableness description
□ Applicable √Not applicable
5. Cash flow
In RMB
Item 2018 2017 Y-o-y changes (+,-)
Subtotal of cash in-flow from
208,693,860.24 108,491,780.86 92.36%
operation activity
Subtotal of cash out-flow from
174,127,810.93 193,043,355.14 -9.8%
operation activity
Net cash flow arising from
34566049.31 -84,551,574.28 140.88%
operating activities
Subtotal of cash in-flow from
77,398,996.88 194,516,247.27 -60.21%
investment activity
Subtotal of cash out-flow from
226,742,685.22 177,399,405.19 27.81%
investment activity
Net cash flow from investment
-149,343,688.34 17,116,842.08 -972.5%
activity
Subtotal of cash in-flow from
101,710,000.00 9,600,000.00 959.48%
financing activity
Subtotal of cash out-flow from
21,796,513.79 698,492.97 3,020.51%
financing activity
Net cash flow from financing 79,913,486.21 8,901,507.03 797.75%
20
东沣科技集团股份有限公司 2018 年年度报告全文
activity
Net increased amount of cash
-34,594,471.70 -58,863,446.14 41.23%
and cash equivalent
Main reasons for y-o-y major changes in aspect of relevant data
√Applicable □ Not applicable
1. Major changes in cash flow from operating activities: the intercourse funds received in the year growth;
2. Major changes in cash flow from investment activities: the amount paid for construction in process increased in the year;
3. Major changes in cash flow from financing activities: received loans from the bank in the year
Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
□ Applicable √ Not applicable
III. Analysis of the non-main business
√Applicable □ Not applicable
In RMB
Amount Ratio in total profit Causes Whether it is sustainable (Y/N)
Due to subsidiary disposal in
Investment income 19,646,046.57 263.95% N
the period
Due to the accrual of
Assets impairment 448,072.80 6.02% N
impairment in the period
Non-operating
3,125.00 0.04% N
revenue
Non-operating
473,944.42 6.37% Expenditure from donation N
expenditure
Subsidy for demonstration of
Other income 2,896,903.64 38.92% renewable energy buildings N
received
Income from assets Due to disposal of fixed
4,526,245.58 60.81% N
disposal assets in the period
IV. Assets and liability
1. Major changes of assets composition
In RMB
End of 2018 End of 2017
Ratio
Ratio in total Ratio in total Notes of major changes
Amount Amount changes
assets assets
The amount received in advance for
Monetary fund 36,306,825.10 5.81% 74,805,209.06 14.85% -9.04%
property declined
21
东沣科技集团股份有限公司 2018 年年度报告全文
Account
11,171.25 0.00% 17,608.00 0.00% 0.00%
receivable
151,585,557.5 Carry forward the development
Inventory 24.28% 234,653,825.84 46.58% -22.30%
0 products
Investment real
4,236,346.34 0.84% -0.84%
estate
Long-term equity
0.00%
investment
Fixed assets 17,302,279.65 2.77% 9,674,396.99 1.92% 0.85%
Construction in 101,650,833.1
16.28% 2,267,164.04 0.45% 15.83% New construction in process increased
process 6
Short-term loans 0.00%
101,710,000.0
Long-term loans 16.29% 16.29% New bank loans increased
0
2. Assets and liability measured by fair value
□ Applicable √ Not applicable
3. Limited assets rights ended as the reporting period
Limited monetary funds:
Item Closing balance Opening balance
Deposit for housing mortgage 2,793,908.11 6,697,820.37
Total 2,793,908.11 6,697,820.37
V. Investment
1. Overall situation
√Applicable □ Not applicable
Investment in the reporting (RMB) Investment in the same period of last year ( RMB) Changes
90,000,000.00 107,358,500.00 16.17%
2. The major equity investment obtained in the reporting period
√Applicable □ Not applicable
In RMB
Invested Principal Method Amount Sharehol Capital Partn Term Type of Status Expec Current Whet
company business of of ding sources ers of products as of the ted invest her Date Index of
22
东沣科技集团股份有限公司 2018 年年度报告全文
investm investme invest balance return ment litigat of disclosur
ent nt ment sheet profit ion
disclos e (if
date and
ure (if applicabl
loss
applica e
ble )
)
‖External
Investme
nt from
the
controllin
g
Donggua subsidiar
n R&D y‖ (No.:
Clean
Dongfen and 2018-014
energy Registra
g sales of Capital Self-ow 19 ) released
60,000,00 power tion
Intellige the Increas 100.00% ned N/A --- 0.00 0.00 N May on
0.00 plant complet
nt intellige e capital 2018 Securitie
and e
Technolo nt s Times,
carrier
gy Co., products Hong
Ltd. Kong
Commer
cial
Daily
and
Juchao
Website
‖Equity
Acquisiti
on and
Donggua Technica Technica
Related
n l l
Transacti
Dongfen develop develop
Registra ons‖
g ment of Self-ow ment of 20
Acquisi 30,000,00 tion (No.:
Technolo new 100.00% ned N/A --- new 0.00 0.00 N Dec.
tion 0.00 complet 2018-074
gy energy capital energy 2018
e ) released
Develop and and
on
ment material material
Securitie
Co., Ltd. s s
s Times,
Hong
Kong
Commer
23
东沣科技集团股份有限公司 2018 年年度报告全文
cial
Daily
and
Juchao
Website
90,000,00
Total -- -- -- -- -- -- -- -- 0.00 0.00 -- -- --
0.00
3. The major non-equity investment doing in the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
□ Applicable √ Not applicable
The company had no securities investment in the reporting period
(2) Derivative investment
□ Applicable √ Not applicable
The Company has no derivatives investment in the Period
5. Application of raised proceeds
□ Applicable √ Not applicable
The company had no application of raised proceeds in the reporting period.
(1) Overall utilization of the raised proceeds
□Applicable □Not applicable
(2) Situation of committed project of raised proceed
□Applicable □Not applicable
(3) The changed project of raised proceeds
□Applicable □Not applicable
24
东沣科技集团股份有限公司 2018 年年度报告全文
VI. Sales of major assets and equity
1. Sales of major assets
√Applicable □ Not applicable
Does
The net the plan
profits implem
contrib ented
The
uted to on
proporti
the schedul
on of
listed The e or
the net
compan owners not,
profits The
y by the hip of explain
that the associat Claims
Transac assets Related propert the
Impact assets- ion and
tion for sale transact y rights reasons Index
The on the for Pricing with debts Date of
Counte Assets price from ion that and of
date of Compa -sale principl the transfer disclos
rpart for sale (in 10 the confirm involve counter disclos
sale ny(note contrib e counter red in ure
thousan beginni ed d has measur ure
3) uted to party(if total
d Yuan) ng of (Y/N) transfer es the
the applica (Y/N)
current red Compa
listed ble)
period totally ny have
compan
to the (Y/N) taken
y in
date of for not
total
sale(in implem
profits
10 ented
thousan on
d Yuan) schedul
e
It has a ‖Sales
positive of the
impact Propert
Propert
on the y‖ (No.
y of the
Compa 2018-0
subsidi
ny’s 72)
Liu ary of Based
current Not release
Wei; the 12 Dec. on Comple 13 Dec.
480 371 financia 56.58% N applica Y Y d on
Xu Compa 2018 assessm ted 2018
l ble Securiti
Ranran ny ent
situatio es
-Kefen
n and Times,
g
operati Hong
Trading
on Kong
perform Comme
ance rcial
25
东沣科技集团股份有限公司 2018 年年度报告全文
Daily
and
Juchao
Website
2. Sales of major equity
√ Applicable □Not applicable
Implem
Net
ented on
profit Ratio of
schedul
contribu the net
e (Y/N),
ted by profit Owners
explaine
the sold from Whether hip
Trading Relation d the
equity Impact equity it was a transferr
price Pricing ship reasons Disclos
Counter Equity Sales from on the sales related ed Disclos
(10 principa with the and ure
part sold day period-b Compan in total transacti complet ure day
thousan l counter counter index
egin to y net on ely or
d Yuan) party measure
date for profit of (Y/N) not
for not
sales (in the (Y/N)
complet
10 Compan
ed on
thousan y
schedul
d Yuan)
e
‖Sales
of 100%
equity
It has a of
positive wholly-
impact owned
on the subsidia
Chengd Compan ry ‖
100%
e y’s (No.
equity Based
Country current 2018-02
of 14 Aug. 2,263.9 282.13 on Complet 15 Aug.
Jinshan 1850.18 financia N N/A Y 8)
Nanjian 2018 5 % assessm ed 2018
gmao l released
g ent
Co., situation on
Trading
Ltd. and Securiti
operatio es
n Times,
perform Hong
ance Kong
Comme
rcial
Daily
26
东沣科技集团股份有限公司 2018 年年度报告全文
and
Juchao
Website
VII. Analysis of main holding company and stock-jointly companies
√Applicable □ Not applicable
Particular about main subsidiaries and stock-jointly companies net profit over 10%
In RMB
Company Main Register Operating Operating
Type Total assets Net Assets Net profit
name business capital revenue profit
Engineering
Chengde
management
Kefeng
and
Engineering
Subsidiary consulting 500,000 46,587.79 -68,619.09 0.00 -180,858.53 -180,858.53
Project
service;
Management
house leasing
Co. Ltd.
service
Industrial
investment,
investment
Chengde
management,
Dongfeng 76,492,179.0 76,492,179.0
Subsidiary investment 90,000,000 0.00 -201,626.78 -201,626.78
Investment 5 5
consulting
Co., Ltd.
and import &
export
trading
International
Nanjiang investment
Asia and trading, US$ 20
Subsidiary 5,626,396.53 5,621,425.31 0.00 269,325.97 269,325.97
Investment ship sales million
Co., Ltd. and purchase
and lease
Sales of
machinery
Chengde
equipment
Kefeng 320,971,667. 258,199,129. -1,600,884.9
Subsidiary and 8,500,000 0.00 -525,611.82
Trading Co., 77 83 0
mechanical
Ltd.
& electrical
products
Hangzhou New energy, 17,571,349.1 17,463,923.5 -10,750,567. -10,750,567.
Subsidiary 30,000,000 0.00
Dongfeng new 0 0 71 71
27
东沣科技集团股份有限公司 2018 年年度报告全文
Technology materials and
Co. Ltd. applied
products
research and
development,
sales and
technical
promotion,
technical
services
Industrial
investment in
technology
Dongguan
field,
Dongfeng
investment 233,633,258. 99,180,086.9
Technology Subsidiary 200,000,000 0.00 -502,531.99 -502,531.99
consultant 98 5
Development
and
Co., Ltd.
management,
equity
investment
Cultivation
and sales of
field crop,
edible
Chengde mushrooms,
Dongfeng fruit and
-16,130,055.
Ecological Subsidiary vegetables as 10,000,000 1,395,559.77 37,731.96 -794,322.25 -839,879.93
22
Agriculture well as
Co., Ltd. Chinese
Herbs;
breeding and
sales of
livestock
Chengde
Huijing Property
-7,966,368.8 -1,238,643.1 -1,238,643.1
Property Subsidiary management 500,000 1,608,024.93 4,627,853.90
8 8 8
Services Co., service
Ltd.
Dongguan Development
Zhongchuang and transfer
24,573,220.4 24,278,297.0
New Energy Subsidiary of the new 24,600,000 0.00 -310,407.66 -310,407.66
3 3
Technology energy
Co., Ltd. technology,
28
东沣科技集团股份有限公司 2018 年年度报告全文
new-type
fuel battery
R&D and
sales of the
intelligent
products;
engaged in
the technical
development
and transfer
in field of
technology,
technical
consultant
Dongguan and services;
Dongfeng R&D of the
282,576,013. 114,171,129. -2,823,795.8 -2,824,029.6
Intelligent Subsidiary clean energy 120,000,000 0.00
00 27 6 0
Technology power
Co., Ltd. equipment as
well as the
sales,
technical
transfer and
consultant;
R&D of the
carrier with
clean energy
power,
technical
transfer and
consultant
Nano-fiber,
Dongguan
functional
Aolin New 23,221,720.7 22,976,448.9 -1,390,951.8 -1,390,951.8
Subsidiary ceramics and 25,000,000 0.00
Materials 2 0 1 1
clean energy
Co., Ltd.
materials
Development
Dongguan and
Haizhuo marketing of
25,032,158.2 24,868,222.8
Energy Subsidiary the hydrogen 25,000,000 0.00 -465,527.38 -465,527.38
0 6
Technology energy
Co., Ltd. products and
special
29
东沣科技集团股份有限公司 2018 年年度报告全文
energy
mechanical
equipment,
technical
consultation
and services
for hydrogen
energy and
power
Particular about subsidiaries obtained or disposed in report period
√Applicable □Not applicable
The method of obtaining and handling The influence to the whole production and
Company Name
subsidiaries during the report period performance
Acting as the platform for hydrogen energy
Dongguan Haizhuo Energy Technology production, has minor influence on
Capital increase
Co., Ltd. performance of the Company during the
period
Donggua Dongfeng Power Technology It has minor impact on performance of the
Equity acquisition
Co., Ltd. Company
It has a positive impact on performance of
Chengde Nanjiang Trading Co., Ltd. Selling 100% equity of Nanjiang Trading
the Company
Notes of holding and shareholding companies
VIII. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
IX. Future Development Prospects
(1) Industry pattern
The Central Economic Work Conference held at the end of 2018 proposed ―building a long-term mechanism for the healthy
development of the real estate market, insisting that the house is used for living but not for speculation, implementing different urban
policies, giving classification guidance, consolidating the main responsibility of the city government, and improving housing market
system and housing guarantee system‖, and combined with the requirements of ―stable land prices, stable housing prices, and stable
expectations‖ of the Ministry of Housing and Urban-Rural Development at the end of 2018, it’s expected that the overall real estate
control policy in 2019 will not change much, under the premise of continuing the existing regulation, and ―stable‖ will become the
main tone of the real estate market. In the future, more emphasis will be placed on the regulation and intervention to the market
through the regional policies of the city governments, the flexibility of regulation and control of local governments will increase, and
the control policies involving land, lease and guarantee will be further improved, and the control methods will be optimized.
At present, the world’s new energy technologies are engaged in research and development competition in the fields of alternative
energy, environmental protection, storage, etc., and automobile manufacturing is also rapidly transforming in power and alternative
energy technologies. The hydrogen energy is regarded as ―the ultimate energy source for human beings‖ because it only generates
water when burned and is characterized by clean and efficient, energy storable, transportable, and rich application scenarios.
30
东沣科技集团股份有限公司 2018 年年度报告全文
According to the Hydrogen Energy Future Development Report released by the International Association for Hydrogen Energy, by
2050, the global hydrogen energy industry will create 30 million jobs, reduce 6 billion tons of carbon dioxide, and create a market
value of 2.5 trillion US dollars, the hydrogen automobile will account for 20%-25% of vehicles worldwide. China is paying more and
more attention to the development of hydrogen energy, the Government Work Report of 2019 has mentioned ―promoting the
construction of facilities such as charging and hydrogenation‖, which indicates that the development of hydrogen energy will be
raised to a new height in the future. As an important guarantee for the national economy leading industry and high-end
manufacturing and defense industry, the new materials will become the focus of strategic competition in various industries due to its
excellent performance, high tolerance and wide application.
(II) The company’s development strategy and business plan
In 2019, the company will continue to develop its real estate business with a steady pace while promoting strategic transformation so
as to foster new profit growth points for the company. At the same time, we will explore new financing channels, continue to try
multi-channel financing, increase project financing, actively supplement high-quality funding sources, and provide solid financial
support for the project development of the company’s various sectors.
(III) Possible risks and responses
1. Policy risk
The real estate industry is greatly affected by macroeconomic policies, land policies, real estate tax policies, and financial policies for
the real estate industry will have direct impacts on real estate companies. The company will pay close attention to the macro situation,
strengthen the research and tracking of policies, rationally analyze the market, adapt to market adjustments and changes, and improve
the company’s ability to resist risks.
2. Market risk
Under the background of slowing economic growth, the real estate market has become more differentiated and the market
competition has become increasingly fierce, the company will continue to strengthen its own construction, improve its management
capabilities, and continuously enhance its competitive strength.
3. Management risks brought about by strategic transformation
Through the strategic layout of the company, the company will enter a new business field, the company will face the risks brought by
uncertain factors in the market, technology, operation and management in the preparation and operation of new projects. The
company will further strengthen the management team building, improve management level and management capabilities,
continuously improve corporate governance and management mechanisms, and form a more scientific and effective decision-making
mechanism and control and supervision mechanism. At the same time, guided by technological innovation, the company will
strengthen technical research and development capabilities, build technological advantages with core competitiveness, improve the
company’s overall competitiveness, and promote the company’s sustainable development.
X. Reception of research, communication and interview
1. In the report period, reception of research, communication and interview
√Applicable □ Not applicable
Time Way Type Basic situation index of investigation
Operation of the Company, no materials
26 Feb. 2018 Telephone communication Individual
required
Current condition of the Company, no
22 Mar. 2018 Telephone communication Individual
materials required
2 Aug. 2018 Telephone communication Individual Operation of the Company, no materials
31
东沣科技集团股份有限公司 2018 年年度报告全文
required
Current condition of the Company, no
28 Sept. 2018 Telephone communication Individual
materials required
Current condition of the Company, no
13 Nov. 2018 Telephone communication Individual
materials required
Reception (times) 5
Number of hospitality 0
Number of individual reception 5
Number of other reception 0
Disclosed, released or let out major undisclosed
N
information
32
东沣科技集团股份有限公司 2018 年年度报告全文
Section V. Important Event
I. Profit distribution plan of common stock and capitalizing of common reserves plan
Formulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially Cash Dividend policy during
the Reporting Period
□Applicable √Not applicable
Profit distribution plan (pre-plan) of common stock and capitalizing of common reserves plan (pre-plan) in latest three years
(including the reporting period)
In latest three years, net profit of the Company after making up the annual losses of previous years, retained profit at end of the
Period still negative, being deliberated and approved by the Board and General Meeting, the Company has no profit distributed
carried out. The Company has no plan of cash dividend distributed, bonus shares and capitalizing from common shares conducted
either for year of 2018.According to the Detailed Rules for the Share Repurchase of Listed Companies of the Shenzhen Stock
Exchange, ―when the listed company uses cash as the consideration, and adopts the offer method or centralized bidding to buy back
the shares, the amount of money used for share repurchase in the current year is regarded as the cash dividends amount and is
calculated by the relevant proportion of annual cash dividends‖. In 2018, the amount of the shares that the company repurchased by
centralized bidding was RMB 19,718,613.55, which was regarded as the cash dividends of 2018.
Cash dividend of common stock in latest three years (including the reporting period)
In RMB
Ratio of the
Ratio of the
Ratio of the total cash
Net profit cash bonus by
cash bonus in bonus (other
attributable to other ways in
net profit ways included)
common stock Proportion for net profit
attributable to Total cash in net profit
Amount for shareholders of cash bonus by attributable to
Year for bonus common stock bonus attributable to
cash bonus (tax listed company other ways(i.e. common stock
shares shareholders of (including common stock
included) in share shareholders of
listed company other ways) shareholders of
consolidation buy-backs) listed company
contained in listed company
statement for contained in
consolidation contained in
bonus year consolidation
statement consolidation
statement
statement
2018 0.00 7,383,835.76 0.00% 19,718,613.55 267.05% 19,718,613.55 267.05%
2017 0.00 4,102,325.89 0.00% 0.00 0.00% 0.00 0.00%
2016 0.00 3,760,806.51 0.00% 0.00 0.00% 0.00 0.00%
The Company gains profits in reporting period and the retained profit of common stock shareholders provided by parent company is
positive but no plan of cash dividend proposed of common stock
□ Applicable √ Not applicable
33
东沣科技集团股份有限公司 2018 年年度报告全文
II. Profit distribution plan and capitalizing of common reserves plan for the Period
□ Applicable √ Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from capital reserve either for
the year
III. Implementation of commitment
1. Commitments completed in Period and those without completed till end of the Period from actual
controller, shareholders, related parties, purchaser and companies
√Applicable □ Not applicable
Type of
Commitmen Commitmen Implementa
Commitments Promise commitment Content of commitments
t date t term tion
s
Commitments for Share
Merger Reform
1. Commitments in aspect of
independence of listed company:
For the equity changes, that is
208,324,800 shares of Chengde
Dalu Co., Ltd held by Chen Rong
was transfer, Wang Dong
guarantee there are no influence
on the independent of employee,
financial, institution, business and
Commitmen integrity of assets of Chengde
ts in Dalu Co., Ltd. After transaction,
horizontal Chengde Dalu Co., Ltd still has
In duration Normal
Commitments in report of Controlling competition, the ability of independent 24 April
of the performanc
acquisition or equity change shareholder related operation and owes independent 2012
Company e
transactions, legal person, and continues to
and capital owes the independence of
occupying institution, assets, employees,
production and financial. 2.
Commitments for horizontal
competition: after 208,324,800
shares of Chengde Dalu Co., Ltd
held by Chen Rong was transfer,
Wang Dong guarantee there are
no or potential horizontal
competition between the Chengde
Dalu Co., Ltd and Wang Dong
34
东沣科技集团股份有限公司 2018 年年度报告全文
and related parties of Wang Dong
Commitments in assets
reorganization
Commitments in initial
public offering or
re-financing
Commitments in stock
option incentive plan
Because the company’s share On 29
price fell below the face value, in December
order to safeguard the interests of 2018, the
all investors and express closing
confidence in the company’s price of the
long-term development, Mr. Wang stock was
Dong made solemn commitment HK$ 1.14,
that from October 22, 2018 to and no
October 31, 2018, when the book loss
company’s stock price was lower occurs
than or equal to HK$1.13/share, when the
all employees of the company and investors
the shareholders who held the buy (buy
company’s shares on the equity the stock
registration date of October 24, when share
Commitmen 2018 (the last trading day of B price is
Other commitments for t for shares was October 19, 2018) and 22 Oct. 2018 below or
Controlling
medium and small initiative to their immediate family members 19 Oct. 2018 to 28 Dec. equal to
shareholder
shareholders increase the that bought the company’s shares 2018 HK$ 1.13/S
holdings could take the delivery list at the hare) on the
time of purchase to register and initiative’s
verify at the company’s securities commitmen
affairs department, if they could t to
continue to hold the company’s increase
shares until December 28, 2018, their
the shares of the company held by holdings,
them would be calculated based thus, there
on the closing price on December is no
28, 2018, if there were book compensati
losses of investment, Mr. Wang on for this
Dong would compensate 100% of commitmen
the losses of the investors. Mr. t.
Wang Dong took all restricted Commitme
shares of the Company he held as nt has been
the performance guarantee of this fulfilled.
35
东沣科技集团股份有限公司 2018 年年度报告全文
commitment, namely 208,324,800
shares of the company’s stock or
cash equivalents of 100 million
Yuan.
Completed.
After
confirming
with Mr.
Yang
Chengshe
and Ms.
Zhou
Haihong,
Mr. Yang
Chengshe
Based on the confidence in the
did not
company’s long-term
reduce his
development, I am willing to
holding of
actively respond to the proposal of
the
the major shareholder Mr. Wang
company’s
Dong and voluntarily promise not
stock
to reduce my holding of the
during the
company’s stock when the
Yang period of
No company’s share price is lower 22 Oct. 2018
Chengshe, his
reduction than HK$1.13 before December 22 Oct. 2018 to 31 Dec.
Zhou commitmen
commitment 31, 2018. During the above 2018
Haihong t; Ms. Zhou
commitment period, if I violate
Haihong
the above-mentioned commitment
made a
and reduce my holding of the
written
shares of the listed company, the
reply that
income from the reduction of the
she reduced
shares of the listed company will
her holding
be owned by the listed company.
of the
company’s
stock of
5,627,873
shares
during the
commitmen
t period,
and the
reduced-hol
ding share
price per
36
东沣科技集团股份有限公司 2018 年年度报告全文
share was
HK$1.14,
there was
no reducing
of shares
lower than
HK$1.13,
and there
was no
violation of
this
commitmen
t.
Based on the confidence in the
company’s long-term
development, I voluntarily
promise the following: 1. From
January 28, 2019 to December 31,
2019, I will not reduce my
No holding of the company’s stock. 2. 28 Jan. 2019
Yang Implementi
reduction During the above commitment 28 Jan. 2019 to 31 Dec.
Chengshe ng
commitment period, if I violate the 2019
above-mentioned commitment to
reduce my holding of the
company’s stock, the income from
the reduction of the shares of the
listed company will be owned by
the listed company.
Completed on time Yes
If the commitments is not
fulfilled on time, shall
N/A
explain the specify reason
and the next work plan
2. Concerning assets or project of the Company, which has profit forecast, and reporting period still in
forecasting period, explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
IV. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
37
东沣科技集团股份有限公司 2018 年年度报告全文
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable √ Not applicable
VI. Particulars about the changes in aspect of accounting policy, estimates and calculation
method compared with the financial report of last year
√Applicable □ Not applicable
Found more in the 33. of V. Important accounting policy and estimation carried in the Section XI Financial Report in the full text of
Annual Report 2018
VII. Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in the period.
VIII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
√Applicable □ Not applicable
1. Subsidiary newly included in consolidation scope
Name Causes
Dongfeng Power Enterprise combined under the same control
Haizhuo Energy Enterprise combined under the different control
2.Subsidiary excluded in the consolidation scope in the period
Name Causes
Nanjiang Trading Disposal
(1) The Company transferred its 100% equity of NanjiangTrading to Chengde Country Jinshangmao Co., Ltd on August 14, 2018,
therefore, Nanjiang Trading was no longer included in the consolidated balance sheet in the current period, but the Accounting
Standards for Business Enterprises No. 33 – Consolidated Financial Statements stipulates that if a parent company disposes of a
subsidiary during the reporting period, the income, expenses and profits of the subsidiary from the beginning of the period to the
disposal date should be included in the consolidated income statement, and the cash flows of the subsidiary from the beginning of the
period to the disposal date should be included in the consolidated cash flow statement. Therefore, the income, expenses and profits of
NanjiangTrading from the beginning of the current period to the date of cancellation were still included in the scope of consolidation.
(2) Dongguan Dongfeng Power Tech. Co., Ltd. is a holding sub-subsidiary acquired on August 28, 2018. On December 25, 2018,
Dongguan Dongfeng Tech. transferred it to the Company to become a holding subsidiary.
(3) Dongguan Haizhuo Energy Technology Co., Ltd. is a holding sub-subsidiary that increased its capital and shares on March 6,
2018.
38
东沣科技集团股份有限公司 2018 年年度报告全文
IX. Appointment and non-reappointment (dismissal) of CPA
Accounting firm appointed
Dahua Certified Public Accountants (Limited Liability
Name of domestic accounting firm
Partnership)
Remuneration for domestic accounting firm (10 thousand Yuan) 50
Continuous life of auditing service for domestic accounting firm 7
Name of domestic CPA Hu Zhigang, Yan Lisheng
Continuous life of auditing service for domestic CPA 1
Name of foreign accounting firm (if applicable) N/A
Continuous life of auditing service for foreign accounting firm (if
N/A
applicable)
Name of foreign CPA (if applicable) N/A
Whether re-appointed accounting firms in this period or not
□Yes √No
Appointment of internal control auditing accounting firm, financial consultant or sponsor
√Applicable □Not applicable
The Company engaged Dahua CPA (LLP) as the internal control auditing organ in the Year; the auditing costs paid amounting to
250,000 Yuan in reporting period.
X. Particular about suspended and delisting after annual report disclosed
□ Applicable √ Not applicable
XI. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period
XII. Significant lawsuits and arbitration of the Company
□Applicable √Not applicable
No significant lawsuits and arbitration occurred in the reporting period
XIII. Penalty and rectification
□ Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.
XIV. Integrity of the company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
39
东沣科技集团股份有限公司 2018 年年度报告全文
XV. Implementation of the company’s stock incentive plan, employee stock ownership plan or
other employee incentives
□ Applicable √ Not applicable
During the reporting period, the company has no stock incentive plan, employee stock ownership plan or other employee incentives
that have not been implemented.
XVI. Major related transaction
1. Related transaction with routine operation concerned
□ Applicable √ Not applicable
No related transaction with routine operation concerned occurred in the period
2. Related transactions by assets acquisition and sold
□ Applicable √ Not applicable
No related transactions by assets acquisition and sold for the Company in reporting period
3. Main related transactions of mutual investment outside
□ Applicable √ Not applicable
No main related transactions of mutual investment outside for the Company in reporting period.
4. Contact of related credit and debt
□ Applicable √ Not applicable
The Company had no contact of related credit and debt in the reporting period.
5. Other related transactions
√Applicable □Not applicable
(1) The company’s controlling subsidiary Dongfeng Technology Development signed an Equity Transfer Agreement with Tibet
Dongfeng Investment Co., Ltd. that Dongfeng Technology Development purchases 100% stock equity of Dongguan Dongfeng
Power Technology Co., Ltd. held by Tibet Dongfeng with 0 yuan. After the stake purchase, Dongfeng Technology Development will
hold 100% stock equity of Dongfeng Power.
Because Tibet Dongfeng and the company are controlled by Mr. Wang Dong, the company’s controlling shareholder and actual
controller, and the director of the company, Mr. Chen Weihuan, serves as a director of Tibet Dongfeng, according to the relevant
regulations ofRules Governing the Listing of Securities on Shenzhen Stock Exchangeand Articles of Association, Tibet Dongfeng is a
related legal person of the company, and the stake purchase matters constitute a related transaction.
(2) The company signed an Equity Transfer Agreement with Mr. Wu Zhe that the company purchases 30% stock equity of Dongfeng
Technology held by Mr. Wu Zhe with 0 yuan. After the stake purchase, the company will hold 100% stock equity of Dongfeng
Technology Development.
40
东沣科技集团股份有限公司 2018 年年度报告全文
As Mr. Wu Zhe is a director of the seventh board of directors of the company, according to the relevant regulations of Stock Listing
Rules of Shenzhen Stock Exchange and Articles of Association, Mr. Wu Zhe is a related natural person of the company, and the stake
purchase matters constitute a related transaction.
Relevant website for information disclosure
Temporary notice Dated disclosed Website for disclosure
Equity Acquisition and Related Transaction
30 Aug. 2018 Juchao website
No. 2018-032
Equity Acquisition and Related Transaction
20 Dec. 2018 Juchao website
No. 2018-074
XVII. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
No trusteeship for the Company in reporting period
(2) Contract
□ Applicable √ Not applicable
No contract for the Company in reporting period
(3) Leasing
□ Applicable √ Not applicable
No leasing for the Company in reporting period
2. Major guarantees
√Applicable □Not applicable
(1) Guarantee
In 10 thousand Yuan
Particulars about the external guarantee of the Company and its subsidiary (Barring the guarantee for subsidiaries)
Related Guarante
Announce Actual e for
Name of the Company Guarantee Actual date of Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit happening type term ted (Y/N)
disclosure limit party
date (Y/N)
41
东沣科技集团股份有限公司 2018 年年度报告全文
Guarantee of the Company for subsidiaries
Related Guarante
Announce Actual e for
Name of the Company Guarantee Actual date of Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit happening type term ted (Y/N)
disclosure limit party
date (Y/N)
Joint liability
Dongguan Dongfeng
14 June guaranty;
Intelligent Technology 20,000 2 July 2018 5 years N N
2018 mortgage;
Co., Ltd.
pledge
Total amount of actual
Total amount of approving
occurred guarantee for
guarantee for subsidiaries in report 20,000 10,171
subsidiaries in report period
period (B1)
(B2)
Total balance of actual
Total amount of approved
guarantee for subsidiaries at
guarantee for subsidiaries at the 20,000 20,000
the end of reporting period
end of reporting period (B3)
(B4)
Guarantee of the subsidiaries for subsidiaries
Related Guarante
Announce Actual e for
Name of the Company Guarantee Actual date of Guarantee Guarantee Implemen
ment guarantee related
guaranteed limit happening type term ted (Y/N)
disclosure limit party
date (Y/N)
Total amount of guarantee of the Company (total of three abovementioned guarantee)
Total amount of approving Total amount of actual
guarantee in report period 20,000 occurred guarantee in report 10,171
(A1+B1+C1) period (A2+B2+C2)
Total amount of approved Total balance of actual
guarantee at the end of report 20,000 guarantee at the end of 20,000
period (A3+B3+C3) report period (A4+B4+C4)
The proportion of the total amount of actually guarantee in the net
56.88%
assets of the Company (that is A4+ B4+C4)
Including:
Amount of guarantee for shareholders, actual controller and its
0
related parties (D)
The debts guarantee amount provided for the guaranteed parties
0
whose assets-liability ratio exceed 70% directly or indirectly (E)
Explanations on possibly bearing joint and several liquidating
N/A
responsibilities for undue guarantees (if applicable)
Explanations on external guarantee against regulated procedures
N/A
(if applicable)
Explanation on guarantee with composite way
42
东沣科技集团股份有限公司 2018 年年度报告全文
In order to meet the operation and development needs of the company’s holding sub-subsidiary Dongfeng Intelligent, Dongfeng
Intelligent planned to apply for comprehensive credit line of no more than RMB 200 million to Bank of Dongguan, Songshan Lake
Technology Sub-branch, the credit period is two years, and the single-use period should not be more than 5 years, it is specially used
to build the Dongfeng New Energy Equipment Industrialization Project located at the east side of Fuxing Road, Ecological Park,
Dongguan City, and the company’s holding subsidiary, Dongguan Dongfeng Technology Development Co., Ltd., takes its 100%
equity of Dongfeng Intelligent as a pledge guarantee, and Dongfeng Intelligent uses its own land and above-ground buildings as
security guarantees, and Dongfeng Technology Group, Dongfeng Technology Development, Zhongchuang New Energy, Haizhuo
Energy and Aolin New Materials are jointly and severally liable for it, and the guarantee period is 5 years. For details, please refer to
the Announcement on the Provision of Mortgage Guarantee for Subsidiary’s Application for Bank Credit Announcement No.
2018-018 published on June 14, 2018 by Juchao Website.
(2) Guarantee outside against the regulation
□Applicable √Not applicable
No guarantee outside against the regulation in Period.
3. Entrust others to cash asset management
(1) Trust financing
√Applicable □ Not applicable
Entrust financing in the period
In 10 thousand Yuan
Type Capital resources Amount for entrust Balance un-expired Overdue amount
Bank financing product Self-owned capital 3,380 2,400 0
Total 3,380 2,400 0
Details of the single major amount, or high-risk trust investment with low security, poor fluidity and non-guaranteed
□ Applicable √ Not applicable
Entrust financial expected to be unable to recover the principal or impairment might be occurred
□ Applicable √ Not applicable
(2) Entrusted loans
□ Applicable √ Not applicable
The company had no entrusted loans in the reporting period.
4. Other material contracts
□ Applicable √ Not applicable
No other material contracts for the Company in reporting period.
43
东沣科技集团股份有限公司 2018 年年度报告全文
XVIII. Social responsibility
1. Fulfill social responsibility
Not applicable
2. Execution of social responsibility of targeted poverty alleviation
The Company has no execution of targeted poverty alleviation and no follow-up plan either.
3. Environmental protection
Listed company and its subsidiary belongs to the key pollution enterprise listed by Department of Environmental Protection
No
Not applicable
XIX. Explanation on other significant events
√Applicable □Not applicable
(1) On August 14, 2018, the second session of the seventh board of directors of the company reviewed and approved the Proposal on
Disposal 100% Equity of a Wholly-owned Subsidiary, and agreed the company to transfer its 100% stake in Chengde Nanjiang
Trading Co., Ltd. (hereinafter referred to as ―Nanjiang Trading‖) to Chengde Country Jinshangmao Co., Ltd. According to the Equity
Transfer Agreement signed on the same day, Nanjiang Trading allocated the profits according to the Shareholders’ Meeting
Resolution issued by its 100% controlling shareholder (i.e. the company) on April 28, 2018, and still owed the company’s profit
distribution amounting to 23.36 million yuan. For details, please refer to the Announcement on the Disposal of 100% Equity of a
Wholly-owned Subsidiary (No.:2018-028) disclosed by the company on www.cninfo.com.cn.
As of November 9, 2018, the company has received a total of 23.36 million yuan of profit distribution from Nanjiang Commercial
and Trading.
(2) On March 12, 2019, the company signed an Equity Transfer Agreement with Ms. Yu Jie, a natural person, that the company
transfers 100% stock equity of its wholly-owned subsidiary Nanjiang Asia Investment Co., Ltd. to Ms. Yu Jie at a transfer price of
RMB 5.55 million.
XX. Significant event of subsidiary of the Company
√Applicable □Not applicable
On December 25, 2018, the company signed an Equity Transfer Agreement with its wholly-owned subsidiary Dongfeng Technology
Development that the company purchases 100% stock equity of Dongfeng Power held by Dongfeng Technology Development with 0
Yuan. Dongfeng Power comes to the wholly-owned subsidiary of the Company from wholly-owned sub-subsidiary.
44
东沣科技集团股份有限公司 2018 年年度报告全文
Section VI. Changes in Shares and Particulars about Shareholders
I. Changes in Share Capital
1. Changes in Share Capital
In Share
Before the Change Increase/Decrease in the Change (+, -) After the Change
Capitaliza
New
Bonus tion of Proportio
Amount Proportion shares Others Subtotal Amount
shares public n
issued
reserve
244,800,0 244,800,0
I. Unlisted shares 34.66% 34.66%
00 00
244,800,0 244,800,0
1. Sponsor’s shares 34.66% 34.66%
00 00
Domestic legal 23,147,30 23,147,30
3.28% 3.28%
person’s shares 9 9
221,652,6 221,652,6
Other 31.38% 31.38%
91 91
461,520,0 461,520,0
II. Listed shares 65.34% 65.34%
00 00
2. Domestically listed 461,520,0 461,520,0
65.34% 65.34%
foreign shares 00 00
706,320,0 706,320,0
III. Total shares 100.00% 100.00%
00 00
Reasons for share changed
□ Applicable √ Not applicable
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Progress of shares buy-back
√Applicable □Not applicable
On October 22, 2018, the company held the 4thsession of the seventh board of directors which reviewed and approved the Proposal
on the Repurchase of Company Shares by Centralized Bidding, and the second extraordinary shareholders meeting of 2018 held on
November 7, 2018 reviewed and approved the above proposal. On November 14, 2018, the company disclosed the Repurchase
Report on the Repurchase of Company Shares by Centralized Bidding (Announcement No.: 2018-062). The company implemented
the repurchase for the first time on December 6, 2018, and disclosed the Announcement on the First Repurchase of the Company’s
Shares (Announcement No.: 2018-070) on December 7, 2018. For details of the above, please refer to the relevant announcements
45
东沣科技集团股份有限公司 2018 年年度报告全文
disclosed by the company on Securities Times, Hong Kong Commercial Daily and http://www.cninfo.com.cn. The progress of the
company’s share repurchase was as follows:
Ended as the reporting period, the company repurchased the company’s shares of 28,307,783 shares through a stock repurchase
special security account by centralized bidding transactions, accounting for 4.01% of the company’s total share capital, of which the
highest transaction price was HK$1.18/share, the lowest transaction price was HK$1.09/share, and the total amount paid was
HK$32,095,614.32 (excluding transaction fees). Found more as:
Ceiling Ratio in
Repurcha Amount Bottom price Price repurchased
price (HKD) total share Announcement index
sed date repurchased (HKD) (HKD)
capital
Notice on the First
Repurchase of
2018.12.6 6,586,658 1.14 1.11 7,449,626.48 0.93%
Company’s Shares
(No.:2018-070)
Notice on the
Repurchase of 2% of
2018.12.2
12,864,055 1.14 1.09 14,529,142.54 1.82% the Company’s Shares
0
Capital
(No.:2018-075)
Notice on the
Repurchase of 3% of
2018.12.2
4,994,970 1.18 1.12 5,697,753.10 0.71% the Company’s Shares
7
Capital
(No.:2018-076)
2018.12.2 Notice on the
532,100 1.14 1.14 606,594.00 0.08%
8 Repurchase of 4% of
the Company’s Shares
2019.1.29 3,330,000 1,16 1.14 3,812,498.20 0.47% Capital
(No.:2019-006)
Total 28,307,783 32,095,614.32 4.01%
Implementation progress of the reduction of repurchases shares by centralized bidding
□Applicable √Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
√ Applicable □ Not applicable
EPS and diluted ESP for year of 2018 was 0.0105, if the Company did not implemented the share repurchased, the EPS and diluted
EPS comes to 0.0105; the net assets per share for year of 2018 was 0.498 Yuan, if the whole repurchased shares are canceled, the net
assets per share amounted as 0.512 Yuan.
Other information necessary to disclose for the Company or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
46
东沣科技集团股份有限公司 2018 年年度报告全文
2. Changes of restricted shares
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Security offering (without preferred stock) in reporting Period
□ Applicable √ Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and
liability structure
□ Applicable √ Not applicable
3. Existing internal staff shares
□ Applicable √ Not applicable
III. Particulars about shareholder and actual controller of the Company
1. Amount of shareholders of the Company and particulars about shares holding
In Share
Total preference
Total preference shareholders
Total common shareholders with voting
Total common
stock with voting rights recovered
stock
shareholders at rights recovered at end of last
shareholders in 17,519 17,698 0 0
end of last month at end of month before
reporting
before annual reporting period annual report
period-end
report disclosed (if applicable) disclosed (if
(found in note8) applicable)
(found in note8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Total Number of share pledged/frozen
Amount
sharehol Amount
Proportio Changes of
Full name of Nature of n of ders at of listed
in report un-listed
Shareholders shareholder shares the end shares State of share Amount
held period shares
of report held
held
period
Domestic nature 208,324, 208,324,
Wang Dong 29.49% 0 0
person 800 800
47
东沣科技集团股份有限公司 2018 年年度报告全文
Everbright
Overseas legal 61,644,4 -37,634,3 61,644,46
Securities (H.K.) 8.73% 0
person 67 89 7
Co., Ltd.
GUOTAI JUNAN
SECURITIES(H Overseas legal 47,253,8 -1,584,61 47,253,82
6.69% 0
ONGKONG) person 26 8 6
LIMITED
Haitong
International
Securities Overseas legal 19,694,9 19,694,9 19,694,95
2.79% 0
Company person 59 59 9
Limited-Account
Client
Chengde North Domestic
18,517,6 18,517,6
Industrial non-state owned 2.62% 0 0
51 51
Corporation legal person
Shenwan
HongYuan Overseas legal 14,181,7 14,181,76
2.01% 884,214 0
Securities (Hong person 61 1
Kong) Co., Ltd.
Domestic nature 13,327,8 13,327,8
Wag Zhengsong 1.89% 0 0
person 91 91
Domestic nature 7,750,94 6,945,73
Su Youhe 1.10% 0 7,750,947
person 78
Domestic nature 7,258,00
Wang Wensheng 1.03% 0 0 7,258,007
person 7
CORE
PACIFIC-YAMAI
CHI Overseas legal 6,882,24 6,882,24
0.97% 0 6,882,243
INTERNATIONA person 33
L (H.K.)
LIMITED
Strategy investors or general legal
person becomes top 10 shareholders
N/A
due to rights issued (if applicable)
(see note 3)
Explanation on associated The Company is unknown whether there exists associated relationship or belongs to
relationship among the aforesaid consistent actor regulated by ―management method for acquisition of listed company‖ among
shareholders the above said shareholders.
Particular about top ten circulated shareholders
48
东沣科技集团股份有限公司 2018 年年度报告全文
Type of shares
Shareholders’ name Amount of listed shares held at period-end
Type Amount
Domestically
Everbright Securities (H.K.) Co.,
61,644,467 listed foreign 61,644,467
Ltd.
shares
GUOTAI JUNAN Domestically
SECURITIES(HONGKONG) 47,253,826 listed foreign 47,253,826
LIMITED shares
Domestically
Haitong International Securities
19,694,959 listed foreign 19,694,959
Company Limited-Account Client
shares
Domestically
Shenwan HongYuan Securities
14,181,761 listed foreign 14,181,761
(Hong Kong) Co., Ltd.
shares
Domestically
Su Youhe 7,750,947 listed foreign 7,750,947
shares
Domestically
Wang Wensheng 7,258,007 listed foreign 7,258,007
shares
CORE PACIFIC-YAMAICHI Domestically
INTERNATIONAL (H.K.) 6,882,243 listed foreign 6,882,243
LIMITED shares
Domestically
Zhou Haihong 6,711,600 listed foreign 6,711,600
shares
Domestically
Tang Haiming 3,990,000 listed foreign 3,990,000
shares
Domestically
Peng Wei 2,978,525 listed foreign 2,978,525
shares
Expiation on associated relationship
or consistent actors within the top 10 The Company is unknown whether there exists associated relationship or belongs to
un-restrict shareholders and between consistent actor regulated by ―management method for acquisition of listed company‖ among
top 10 un-restrict shareholders and the above said shareholders.
top 10 shareholders
Explanation on shareholders
involving margin business about top N/A
ten common shareholders with
49
东沣科技集团股份有限公司 2018 年年度报告全文
un-restrict shares held (if applicable)
(see Note 4)
Whether top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held have a buy-back
agreement dealing in reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held of the Company have no
buy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: natural person holding
Type of controlling shareholders: natural person
Enjoy the residence power in the other country or area
Controlling shareholder Nationality
(Y/N)
Wang Dong P.R.C N
He served as executive director respectively in Guangzhou Lianzhengda
Communication Technology Co., Ltd., Shanghai Nanjiang Investment Co., Ltd.,
Chengdu Nanjiang Engineering Technology Co., Ltd., Ningbo Morsh Technology
Co., Ltd., Shanghai Nanjiang (Group) Co., Ltd., Chongqing Nanjiang Investment
Main occupation or position
Co., Ltd. and Beijing Morsh Holding Group Co., Ltd. from September 2009 to July
2016. and he served as executive director and GM of Tibet Dongfeng Investment
Co., Ltd. He serves as executive director and GM of Shenzhen Dongfeng Group
Co., Ltd. since March 2015
Equity of listed Company in and out of China
N/A
control and hold in the Period
Changes of controlling shareholders in reporting period
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period
3. Actual controller of the Company and persons acting in concert
Nature of actual controller:Domestic nature person
Type of actual controller: natural person
Relationship with Enjoy the residence power in the other country
Actual controlling shareholders Nationality
actual controller or area (Y/N)
Wang Dong Mr. Wang himself P.R.C N
He served as executive director respectively in Guangzhou Lianzhengda Communication
Technology Co., Ltd., Shanghai Nanjiang Investment Co., Ltd., Chengdu Nanjiang
Main occupation or position Engineering Technology Co., Ltd., Ningbo Morsh Technology Co., Ltd., Shanghai Nanjiang
(Group) Co., Ltd., Chongqing Nanjiang Investment Co., Ltd. and Beijing Morsh Holding
Group Co., Ltd. from September 2009 to July 2016. and he served as executive director and
50
东沣科技集团股份有限公司 2018 年年度报告全文
GM of Tibet Dongfeng Investment Co., Ltd. He serves as executive director and GM of
Shenzhen Dongfeng Group Co., Ltd. since March 2015
Listed companies in and out of
N/A
China that controlled in last 10 years
Changes of actual controller in reporting period
□ Applicable √ Not applicable
No changes of actual controllers for the Company in reporting period.
Property right and controlling relationship between the actual controller and the Company is as follow:
Wang Dong
29.49%
Dongfeng Sci-Tech Group CO., LTD.
Actual controller controlling the Company by entrust or other assets management
□ Applicable √ Not applicable
4. Particulars about other legal person shareholders with over 10% shares held
□ Applicable √ Not applicable
5. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,
restructuring side and other commitment subjects
□ Applicable √ Not applicable
51
东沣科技集团股份有限公司 2018 年年度报告全文
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period.
52
东沣科技集团股份有限公司 2018 年年度报告全文
Section VIII. Particulars about Directors, Supervisors, Senior
Executives and Employees
I. Changes of shares held by directors, supervisors and senior executives
Amount Amount
Shares Shares
of shares of shares
Start held at Other held at
Working End date increased decreased
dated of
Title Sex Age of office period-be changes period-en
Name status office in this in this
term
term gin (share) d
period period
(Share) (Share)
(Share) (Share)
Zhao
Currently 11 June 12 June
Yongshen Chairman M 42 0 0 0 0
in office 2015 2021
g
Zhao
Currently 9 Nov. 12 June
Yongshen GM M 42 0 0 0 0
in office 2018 2021
g
Zhao
Currently 11 June 12 June
Yongshen CFO M 42 0 0 0 0
in office 2015 2021
g
Li Vice Currently 11 June 12 June
M 56 0 0 0 0
Weimin Chairman in office 2015 2021
Chen Currently 11 June 12 June
Director M 44 0 0 0 0
Weihuan in office 2015 2021
Wang Currently 13 June 12 June
Director M 44 0 0 0 0
Liang in office 2018 2021
Independ
Zhai Currently 13 June 12 June
ent M 40 0 0 0 0
Hongtao in office 2018 2021
director
Independ
Currently 13 June 12 June
Li Jianhui ent M 51 0 0 0 0
in office 2018 2021
director
Independ
Currently 13 June 12 June
Zhou Jian ent M 47 0 0 0 0
in office 2018 2021
director
Currently 27 Nov. 12 June
Wu Zhe Director M 62 0 0 0 0
in office 2018 2021
53
东沣科技集团股份有限公司 2018 年年度报告全文
Currently 27 Nov. 12 June
Lin Lixin Director M 57 0 0 0 0
in office 2018 2021
Shen Director, Office 11 June 9 Nov.
M 55 0 0 0 0
Linxiang GM leaving 2015 2018
Cui Office 26 May 9 Nov.
Director M 49 0 0 0 0
Huating leaving 2016 2018
Independ
Guo Office 31 July 13 June
ent M 48 0 0 0 0
Huibin leaving 2012 2018
director
Independ
Zhang Office 31 July 13 June
ent M 65 0 0 0 0
Zhiyong leaving 2012 2018
director
Independ
Cao Office 27 April 13 June
ent M 52 0 0 0 0
Guohua leaving 2012 2018
director
Chairman
of
Superviso
ry
Hao Currently 27 April 12 June
Committe M 43 5,900 0 0 5,900
Guangxin in office 2012 2021
e,
Employee
superviso
r
Xiao Superviso Currently 26 May 12 June
M 52 0 0 0 0
Yongfu r in office 2016 2021
Ma Superviso Currently 26 May 12 June
M 53 0 0 0 0
Haipeng r in office 2016 2021
Sun Deputy Currently 11 June 12 June
M 55 0 0 0 0
Hongwei GM in office 2015 2021
Secretary
Li Currently 4 July 12 June
of the F 34 0 0 0 0
Wenying in office 2014 2021
Board
Total -- -- -- -- -- -- 5,900 0 0 5,900
II. Changes of directors, supervisors and senior executives
√Applicable □ Not applicable
Name Title Type Date Reasons
Shen Linxiang Director, GM Office leaving 9 Nov. 2018 Voluntary turnover
54
东沣科技集团股份有限公司 2018 年年度报告全文
Cui Huating Director Office leaving 9 Nov. 2018 Voluntary turnover
Leave the office
Independent
Guo Huibin while office term 13 June 2018 Leave the office while office term ends
director
ends
Leave the office
Independent
Zhang Zhiyong while office term 13 June 2018 Leave the office while office term ends
director
ends
Leave the office
Independent
Cao Guohua while office term 13 June 2018 Leave the office while office term ends
director
ends
III. Post-holding
Professional background, major working experience and present main responsibilities in Company of directors, supervisors and
senior executive
Zhao Yongsheng, male, born in January 1977, he owes a master of business administration. He served as GM for WholeWise Sci. &
Tech. Co., Ltd and Netcom division from 1999 to 2006; and served as GM of Shenzhen XinJinDa Investment Co., Ltd. from 2006 to
2012. He serves as director, GM of the Company from 2012 to June 2015; he serves as deputy president of Eagles Men Aeronautic
Science and Technology Group Co., Ltd. since August 2015 and now he is the president, GM and CFO of the Company.
Li Weimin: male, born in 1963 and has a graduate diploma. He worked in 1st section of Ministry of Metallurgical Industry and
Zhongjian Law Practice Center; he works in China Kejian Co., Ltd. since October 2001 to May 2014; hold secretary of the Board for
China Kejian Co., Ltd. since April 2003 to July 2013; hold director for China Kejian Co., Ltd. since April 2003 to May 2014; and he
successively serves as Director, chairman and deputy chairman of the Company since July 2012, he is the deputy chairman of the
Company right now.
Chen Weihuan, male, born in December 1975, an accountant with university degree. He successively served as manager of financial
dept. of WholeWise Sci.& Tech. Co., Ltd, as CFO of China Kejian Co., ltd., CFO of the Shanghai Nanjiang Group Co.,Ltd., deputy
GM of Shenzhen Dongfeng Group Co., Ltd., Director of the Beijing Morsh Holding Group Co., Ltd. He is work in Scenery Culture
Culture Industry Co., Ltd. Now he is the Director of the Company.
Wang Liang, male, born in June 1975, holds a college degree. From 2011 to 2014, he served as a deputy general manager and the
chairman of Ningbo Morsh Tech. Co., Ltd.; from 2014 to 2016, he served as a deputy general manager of Hangzhou Nanjiang
Robotics Co., Ltd.; since 2016, he has been serving as the chief financial officer of Hangzhou Dongfeng Cloaking Technology Co.,
Ltd. and Hangzhou Dongfeng Technology Co., Ltd., and since June 2018, he has been serving as a director of the company.
Lin Lixin, male, born in September 1962, is a master of engineering and a senior engineer. He served as the director of China
Huaneng Group Co., Ltd., the executive deputy general manager of China Unicom Chongqing Branch, the chairman and general
manager of Beijing Shidai Hongzhi Software Co., Ltd.; the director and general manager of Beijing Langxin Information System Co.,
Ltd.; the director and general manager of Sichuan Direction Optoelectronics Co., Ltd., the chairman and general manager of Beijing
Huawei Langxin Technology Co., Ltd., and the chairman of Deluxe Family Holdings Limited. He currently serves as the chairman of
Beijing Xizhou Group Co., Ltd. Since December 2018, he has been serving as a director of Chian Dive Company Limited. Since
November 2018, he has been serving as a director of the company.
55
东沣科技集团股份有限公司 2018 年年度报告全文
Wu Zhe, male, born on February 10, 1957, Han nationality, Taiyuan City, Shanxi Province, a member of the Communist Party of
China. He was the former vice-president of Beijing University of Aeronautics and Astronautics, a professor of aircraft design major,
a doctoral tutor, and a specially-appointed professor for the Cheung Kong Scholar of Ministry of Education, and is currently the dean
of Institute of Beihang University in Dongguan. Since November 2018, he has been serving as a director of the company.
Li Jianhui, born in 1968, holds a master’s degree, and is a certified public accountant and a senior accountant. He has served as an
accountant of Yangcheng Evening News, the assistant general manager of Guangzhou Lingnan Certified Public Accountants Co.,
Ltd., the director of Guangzhou GuangLing Certified Public Accountants Co., Ltd., the deputy chief accountant of Guangzhou
Construction Group Co., Ltd., the chief financial officer of Guangzhou Construction Co., Ltd., an independent director of Guangdong
Anjubao Digital Technology Co., Ltd.. He currently serves as a consultant of Guangzhou Guangling Certified Public Accountants
Co., Ltd., an independent director of Guangdong Xiongsu Technology Group Co., Ltd., a supervisor of Guanhao Biotech Co., Ltd.,
an independent director of Qiaoyin Environmental Protection Technology Co., Ltd., and an independent director of Guangdong
Huate Gas Co., Ltd. Since June 2018, he has been serving as a director of the company.
Zhou Jian, male, born in 1972, graduate degree. From July 1996 to October 2013, he served as the sales director of China for RC Air
Conditioning Beijing Office and the chairman of Beijing Shiji Shengtong Environmental Engineering Technology Co., Ltd. Since
April 2014, he has been the general manager of Beijing Guoding Kechuang Capital Management Co., Ltd. and the general manager
of Beijing Gongdao Innovation Investment Co., Ltd. Since June 2018, he has been serving as a director of the company.
Zhai Hongtao, male, born in 1979, a Master of Laws of Peking University, and aMaster of Business Administration for Senior
Management at Cheung Kong GraduateSchool of Business. Since 2009, he has been serving as a partner of Grandall Law Firm
(Beijing). Since August 2016, he has been serving as an independent director ofLangfang Development Co., Ltd. Since June 2018, he
has been serving as a director ofthe company.
Hao Guangxin, male, born in 1976, has a secondary school education. In 1996, he joined the former Dixian Co., Ltd., and served as
the factory director, the business supervisor and the section chief of the integrated business department, and the office director of
Chengde Dalu Co., Ltd. He is currently the chairman of the board of supervisors of the company and the employee supervisor.
Xiao Yongfu, male, born in July 1967, has a college degree, and is a member of the Communist Party of China. In 1988, he joined
Chengde Dixian Textile Co., Ltd., and served as the factory director of the dyeing factory, the manager of the weaving and dyeing
branch, the manager of the weaving factory, the general manager of Hanhe Company, and the project manager of Chengde Nanjiang
Co., Ltd., since March 2012, he has been serving as the manager of the sales department. He is currently a supervisor of the
company.
Ma Haipeng, male, born in October 1965, has a high school education. In 1990, he joined Chengde Dixian Textile Co., Ltd., and
served as the section chief of the mechanical and electrical department and the manager of the power department. Since May 2013,
he has been serving as the deputy manager of the Integrated Affairs Department of Chengde Nanjiang Co., Ltd. He is currently a
supervisor of the company.
Sun Hongwei, male, born in 1964, a high school background, worked in Chengde Dixian Knitting Co., Ltd. in 1986, and successively
served as chief of electrical and mechanical department of Dye Plant, GM of infrastructure division for electromechanical device,
person in charge of the preparatory office of Xingye Paper Making, manager of Xingye Paper Making Company and manager of
engineering department of Chengde Nanjiang Co., Ltd. He served as GM assistant of the Company from October 2013 to June 2015;
and served as the deputy GM of the Company since June 2015.
56
东沣科技集团股份有限公司 2018 年年度报告全文
Li Wenying, female, was born in 1985, a university degree. She served as planning specialist and system support administrator of the
Joyoung Co., Ltd. from July 2008 to October 2010; and worked in security department of Chengde Nanjiang Co., Ltd. in November
2010; she serves as GM of the security department of Chengde Nanjiang Co., Ltd. from April 2012 to July 2014; and serves as
Secretary of the Board of the Company since July 2014.
Post-holding in shareholder’s unit
□ Applicable √ Not applicable
Post-holding in other unit
√Applicable □ Not applicable
Received
Position in Start dated of End date of office remuneration
Name Name of other units
other unit n office term term from other unit
(Y/N)
Chen Weihuan Shenzhen Dongfeng Group Co., Ltd. CFO 19 April 2011 y
Chen Weihuan Scenery Culture Culture Industry Co., Ltd. Director 19 Sept. 2017 N
Dongguan Dongfeng New Energy Tech.
Chen Weihuan Chairman 13 Nov. 2015 N
Co., Ltd.
Zhao Eagles Men Aeronautic Science and Vice
31 Aug. 2015 N
Yongsheng Technology Group Co., Ltd Chairman
Lin Lixin China Dive Company Limited Director 17 Dec. 2018 2 Dec. 2019 Y
Lin Lixin Beijing Xizhou Group Co., Ltd. Director 2 Dec. 2015 N
Punishment of securities regulatory authority in recent three years to the company’s current and outgoing directors, supervisors and
senior management during the reporting period
□ Applicable √ Not applicable
IV. Remuneration for directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
Decision-making procedures: remuneration & appraisal committee proposed remuneration plan, and being approved after
deliberation by the Board, submitted for approval to shareholders’ general meeting.
Recognition basis: based on the industry and scales of the remuneration standards, formulate remuneration combine with actual
operation status of the Company.
Payment: distribute monthly according to remuneration plan
In reporting period, the in-post directors, supervisors and senior executives received remuneration from the Company totally
approximately as RMB 2,125,600
Remuneration for directors, supervisors and senior executives in reporting period
In 10 thousand Yuan
Post-holding Total Whether
Name Title Sex Age
status remuneration remuneration
57
东沣科技集团股份有限公司 2018 年年度报告全文
obtained from the obtained from
Company (before related party of
taxes) the Company
Chairman, GM Currently in
Zhao Yongsheng M 42 26.42 N
and CFO office
Currently in
Li Weimin Vice Chairman M 56 11.76 N
office
Currently in
Chen Weihuan Director M 44 14.56 Y
office
Currently in
Wang Liang Director M 44 22.85 N
office
Independent Currently in
Zhai Hongtao M 40 5.34 N
director office
Independent Currently in
Li Jianhui M 51 5.34 N
director office
Independent Currently in
Zhou Jian M 47 5.34 N
director office
Currently in
Wu Zhe Director M 62 0.83 N
office
Currently in
Lin Lixin Director M 57 0.83 N
office
Shen Linxiang Director, GM M 55 Office leaving 28.88 N
Cui Huating Director M 49 Office leaving 10.93 N
Independent
Guo Huibin M 48 Office leaving 4.98 N
director
Independent
Zhang Zhiyong M 65 Office leaving 4.98 N
director
Independent
Cao Guohua M 52 Office leaving 4.98 N
director
Chairman of
Supervisory
Currently in
Hao Guangxin Committee, M 43 13.57 N
office
Employee
supervisor
Currently in
Xiao Yongfu Supervisor M 52 11.89 N
office
Currently in
Ma Haipeng Supervisor M 53 11.89 N
office
Sun Hongwei Deputy GM M 55 Currently in 13.57 N
58
东沣科技集团股份有限公司 2018 年年度报告全文
office
Secretary of the Currently in
Li Wenying F 34 13.62 N
Board office
Total -- -- -- -- 212.56 --
Delegated equity incentive for directors, supervisors and senior executives in reporting period
□ Applicable √ Not applicable
V. Particulars of workforce
1.Number of Employees, Professional composition, Education background
Employee in-post of the parent Company(people) 56
Employee in-post of main Subsidiaries (people) 125
The total number ofcurrent employees(people) 181
The total number of current employees to receive pay (people) 181
Retired employee’ s expenses borne by the parent Company and
0
main Subsidiaries(people)
Professional composition
Category of professional composition Numbers of professional composition (people)
Production personnel 36
Sales personnel 10
Technical personnel 77
Financial personnel 22
Administrative personnel 36
Total 181
Education background
Category of education background Numbers (people)
Doctor 6
Master 19
Bachelor degree 44
College 52
High school or below 60
Total 181
2. RemunerationPolicy
In accordance with national labor laws and policies and combining the company’s actual situation, the company has established the
salary management system, and pays the salary according to the assessment of salary management system. The employees’
59
东沣科技集团股份有限公司 2018 年年度报告全文
remuneration and benefit level are adjusted appropriately according to the company's operating conditions, and the local living
standards, and the changes in the price index.
The company strictly obeys the "Labor Law" and the relevant national and local labor laws and regulations; signs labor contracts
with employees, and pays the employee insurances by rule.
3. Training programs
The company focuses on staff training and career planning, actively carries out staff training, and organizes various business skill
training from time to time.
4. Labor outsourcing
□ Applicable√ Not applicable
60
东沣科技集团股份有限公司 2018 年年度报告全文
Section IX. Corporate Governance
I. Corporate governance of the Company
In reporting period, the Company complied to laws and rules such as the Company Law, the Security Law, the
Governance Rules of Listed Companies, related regulations of CSRC and the Rules Governing the Listing of
Securities on Shenzhen Stock Exchange, the Internal Control Guidelines of Listed Companies as well as relevant
laws and regulations, standardized the operation, continues to improved and perfected the structure for corporate
governance. Actual condition of the corporate governance almost consistent with requirement and regulations of
normative documents of relevant laws and statute
1. Shareholders and the Shareholders’ General Meeting:
The Company set up Rules of Procedure of Shareholders’ General Meeting and was able to convene and hold the
Shareholders’ General Meeting strictly according to the requirement of normative opinions of the Shareholders’
General Meeting and the procedure of the meeting was legal. The Company ensures that all shareholders share the
actual information of the Company equally and guarantee the legal rights of medium and small shareholders.
2. Relation of the controlling shareholder and the listed company:
The Company is completely independent from the controlling shareholder in terms of personnel; assets, finance,
organization and business, there are no decision-making and operation activities of the Company that being
interfered directly or indirectly by controlling shareholder over the shareholders’ general meeting, and no
condition of capital and assets of the Company occupied by controlling shareholder and its related parties either.
3. Directors and the Board of Directors:
The Company elected directors strictly according to the procedure stated in the Articles of Association and
engaged independent directors according to relevant requirements. All directors can take the responsibilities in a
diligent attitude on behalf of the maximum interests of the Company and the shareholders. The Board of Directors
established Rules of procedure of the Board of Directors, implemented patiently the regulations of the laws,
regulations and the Articles of Association of the Company, treated all shareholders fairly and concentrated on the
interest of relevant beneficial parties.
Specialized commissions were set up in the board of directors such as audit commission, remuneration and
appraisal commission, strategy commission and nomination commission. They respectively take over function of
discussion and determination of significant events according to corresponding working details.
4. Supervisors and the Supervisory Committee:
The population and constitution of the board of supervisors conform to requirements of the Articles of Association,
including one staff representative among the three members. The supervisors could carefully exert duties, take
necessary check and supervision on finance, directors, general managers and other senior managerial personnel,
thus maintain lawful interests of the Company. The procedure of assembling and holding of the board of
61
东沣科技集团股份有限公司 2018 年年度报告全文
supervisors conform to relevant rules of the Listing Rules, the Articles of Association and the Parliamentary
Procedures of the Board of Supervisor.
5. In aspect of relevant beneficial parties
The company fully respects and safeguards the legitimate rights and interests of stakeholders, achieves the
coordination and balance of the interests of shareholders, employees, and community, jointly promotes the
sustainable and healthy development of the company.
6. In aspect of information disclosure and transparency:
The Company authorized the secretary of the Board of Directors to be responsible for information disclosure,
reception of the shareholders’ interviewing and consultation. The Company could disclose relevant information in
a true, accurate, complete and timely manner strictly according to provisions of laws, regulations and the Articles
of Association so as to ensure equal chances for all shareholders to obtain information.
Is there any difference between the actual condition of corporate governance and relevant regulations about
corporate governance for listed company from CSRC?
□Yes √ No
There are no differences between the actual condition of corporate governance and relevant regulations about
corporate governance for listed company from CSRC.
II. Independence of the Company relative to controlling shareholders’ in aspect of businesses,
personnel, assets, organization and finance
The company is completely independent from the controlling shareholder in terms of personnel, assets, finance,
organization and business for independent responsibility and risks undertake, owes an independent business and
ability of self operation.
1. In aspect of personnel: The Company has an independent management of labor force, human resources and
salary. Senior executive of the Company did not take double position in the listed company and controlling
shareholders and with no remuneration received either.
2. In aspect of assets: the Company has clear property relations with its controlling shareholder, and assets of the
Company are totally independent of controlling shareholder. The Company holds completely control and
disposition over the assets, there are no assets or capital occupied by controlling shareholders with interest of the
Company damaged.
3. In aspect of finance: The Company has independent financial department, whole, independent and normatively
operated business accounting system and financial administration system and independent bank account.
4. In aspect of organization independence: The Company’s organizations are wholly independent and the offices
of the Company are wholly separated from the controlling shareholder.
5. In aspect of business: The Company is independent from the controlling shareholder in terms of businesses and
has independent and whole business and operating ability.
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东沣科技集团股份有限公司 2018 年年度报告全文
III. Horizontal competition
□ Applicable √ Not applicable
IV. In the report period, the Company held annual shareholders’ general meeting and
extraordinary shareholders’ general meeting
1. Annual Shareholders’ General Meeting in the report period
Ratio of investor
Session of meeting Type Date Date of disclosure Index of disclosure
participation
Securities Times,
Hong Kong
Annual general Commercial Daily
AGM 13.84% 13 June 2018 14 June 2018
meeting of2017 and Juchao Website
http://www.cninfo.co
m.cn
Securities Times,
Hong Kong
First extraordinary Extraordinary
Commercial Daily
shareholders general shareholders general 13.98% 29 June 2018 30 June 2018
and Juchao Website
meeting of 2018 meeting
http://www.cninfo.co
m.cn
Securities Times,
Second Hong Kong
Extraordinary
extraordinary Commercial Daily
shareholders general 10.30% 7 Nov. 2018 8 Nov. 2018
shareholders general and Juchao Website
meeting
meeting of 2018 http://www.cninfo.co
m.cn
Securities Times,
The Third Hong Kong
Extraordinary
extraordinary Commercial Daily
shareholders general 10.41% 27 Nov. 2018 28 Nov. 2018
shareholders general and Juchao Website
meeting
meeting of 2018 http://www.cninfo.co
m.cn
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
63
东沣科技集团股份有限公司 2018 年年度报告全文
V. Responsibility performance of independent directors
1.The attending of independent directors to Board meetings and shareholders general meeting
The attending of independent directors to Board meetings and shareholders general meeting
Times of Absent the Times
Times of
Board meeting Times of Times of Meeting for presented in
Independent attending by Times of
supposed to present in entrusted the second shareholders’
director communicatio Absence
attend in the person presence time in a row general
n
report period (Y/N) meeting
Cao Guohua 2 0 2 0 0N 1
Zhang Zhiyong 2 0 2 0 0N 1
Guo Huibin 2 0 2 0 0N 1
Zhou Jian 9 1 8 0 0N 1
Zhai Hongtao 9 1 8 0 0N 3
Li Jianhui 9 1 8 0 0N 1
Explanation of absent the Board Meeting for the second time in a row
2. Objection for relevant events from independent directors
Independent directors come up with objection about Company’s relevant matters
□Yes √No
Independent directors has no objections for relevant events in reporting period
3. Other explanation about responsibility performance of independent directors
The opinions from independent directors have been adopted
√ Yes □ No
Explanation on advice that accepted/not accepted from independent directors
According to the requirement of Company Law, Security Laws, Rules for Stock Listing, Article of Association and
Working Mechanism for Independent Directors, independent directors of the Company pay attention to operation
of the Company, performing vary responsibility of independent directors seriously; furthermore, they proactively
investigate and studied operation status, business development and financial status of the Company, strictly
supervise standard operation of the Company. Concerning the engagement of accounting firm, external guarantee,
profit distribution plan and self-evaluation report of internal control, they carry out specific explanation and
independent opinions; and fulfill responsibility to propose scientific and reasonable opinions and recommendation
for operation and development of the Company base on their own professional knowledge, which protect all
interest of the shareholders for the Company. In the report period, independent directors have no objections on
relevant issues of the Company.
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东沣科技集团股份有限公司 2018 年年度报告全文
VI. Duty performance of the special committees under the board during the reporting period
1. Responsibility performance of Auditing Committee
In the report period, auditing committee followed related regulation of Annual Report Work Regulations of Audit
Committee, seriously fulfilled their duties: examine accounting policy, financial system and financial status of eth
Company for year of 2016 as well as the improvement and implementation of internal control; auditing company’s
periodic report and financial report; during the preparation, they cooperated with auditing institution to ensure the
reality, accuracy and completeness of periodic report, and summary the annual work of auditing institution
2. Responsibility performance of Nomination Committee
In the reporting period, nomination committee in line with related regulation of CSRC and Shenzhen Stock
Exchange, conscientiously performed their duties, reviewed the appointment qualification and competency-based
for the Board, supervisory committee and senior executives: the person shall required relevant professional
knowledge and ability of decision-making, supervision and cooperation, and be qualified for relevant positions,
the qualification meets regulations from the Company Law, Governance Rules for Listed Companies and Article
of Association.
3. Responsibility performance of Remuneration and Appraisal Committee
In reporting period, in strict accordance with Working Rules of Remuneration and Appraisal Committee, the
committee earnestly perform their duties, mainly in charge of the formulation of assessment standards for
directors and senior executives, and carried out evaluations; formulated and reviewed the remuneration policy and
plan for directors and managers and directing the Board to improve remuneration system of the Company.
4. Responsibility performance of Strategy Committee
In the reporting period, strategy committee in line with related regulation of CSRC and Shenzhen Stock Exchange,
conscientiously performed their duties, carried on research and proposed advice on the development strategy plans
of the Company as well as the major events that may impact on the Company’s development in the future; they
broadly responsible for the strategic macro management of the Company, strategy formulation, planning approval
and supervision implementation, and study the annual strategy development needs of the Company, development
planning, strengthen scientific of decision-making, improved the decision-making efficiency for major investment
and decision-making quality, perfected the structure of corporate governance.
VII. Works from Supervisory Committee
Whether the Company has risks or not in reporting period that found in supervisory activity from supervisory
committee
□ Yes √ No
Supervisory committee has no objection about supervision events in reporting period
In 2018, all supervisor of the supervisory committee in a responsible manner for general meeting and whole
shareholders, conscientiously abide by the State Laws, regulations and Article of Association, diligent and
responsible, forge ahead, giver full play to the due role of supervisory committee in the Company.
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东沣科技集团股份有限公司 2018 年年度报告全文
(I) Meeting of the supervisory committee and resolutions in Period
Supervisory committee held three meetings in the Period with contents as:
1. On 24 April 2018, the 13th session of 6th supervisory committee was held on way of communication. Proposals
below are been deliberated and approved:
(1) Deliberated and passed theWorking Report of Supervisory Committee for year of 2017;
(2) Deliberated and passed the Financial Report of 2017;
(3) Deliberated and passed the Annual Report of 2017 and Summary;
(4) Deliberated and passed theGeneral Election of Supervisory Committee;
(5) Deliberated and passed the ―Appraisal Report of Internal Control for year of 2017‖
(6) Deliberated and passed the proposal of Accrual of the Assets impairment provision for year of 2017;
(7) Deliberated and passed the First Quarterly Report of 2018 and its Summary
The resolution notices were released on Hong Kong Commercial Daily, Securities Times and Juchao Website
http://www.cninfo.com.cn dated 26 April 2018.
2. On June 13, 2018, the first meeting of the seventh board of supervisors of the company was held at Dahongpao
Mountain Villa Hotel, Mount Wuyi, No. 22, Shuangmen Road, Xingtian Town, Wuyishan City, Nanping City,
Fujian Province. The meeting reviewed and approved the Proposal on the Election of the Chairman of the Seventh
Board of Supervisors of the Company.
The resolution notice was released on Hong Kong Commercial Daily, Securities Times and Juchao Website
http://www.cninfo.com.cn dated 14 June 2018.
3. On 28 August 2018, the 2nd session of 7th supervisory committee was held on conference room in 2/F.
Deliberated and approved the Semi-Annual Report of 2018 and Summary. The resolution was submitted for a
record in Shenzhen Stock Exchange on 29 August 2018.
4. On 29 October 2018, the 3rd session of 7thsupervisory committee was held on conference room in 2/F
Deliberated and approved the Full Text/Text of 3Q Report of 2018. The resolution was submitted for a record in
Shenzhen Stock Exchange on 30 October 2018.
(II) Independent opinion on relevant events of the Company for year of 2018
1. Independent opinion on operate according to law regulations
In accordance with relevant laws and regulations of the State, supervisory committee supervised the convening
procedures of the Board Meeting and resolutions, execution of general meeting’s resolution by the Board, duty
performance of senior executives and management system of the Company. They considered that as for the work
for year of 2018, the Board carried out standard operations in strict accordance with the Company Law, Securities
Law, Listing Rules, Article of Association as well as other regulations and mechanism, responsible and
conscientious, making operation decisions scientifically and reasonably, further to improved the internal
management system and internal control mechanism, established a favorable IC mechanism; no interest of the
Company was violated and behavior against the laws, regulations, article of associations in way of duty
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东沣科技集团股份有限公司 2018 年年度报告全文
performance from the directors and managers been found.
2. Independent opinion on financial condition of the Company
Supervisory committee exercise carefully and diligent examination on the financial system and financial status of
the Company, they considered that real financial status and operation results of the Company have been reflected
in the financial report of 2018.
3. Independent opinion on latest actual investment of raised fund
The Company has no fund raised in the reporting period.
4. Independent opinion on related transaction
Related transactions occurred in the Period:
(1) The company’s controlling subsidiary Dongfeng Technology Development signed an Equity Transfer
Agreement with Tibet Dongfeng Investment Co., Ltd. that Dongfeng Technology Development purchases 100%
stock equity of Dongguan Dongfeng Power Technology Co., Ltd. held by Tibet Dongfeng with 0 yuan. After the
stake purchase, Dongfeng Technology Development will hold 100% stock equity of Dongfeng Power.
Because Tibet Dongfeng and the company are controlled by Mr. Wang Dong, the company’s controlling
shareholder and actual controller, and the director of the company, Mr. Chen Weihuan, serves as a director of
Tibet Dongfeng, according to the relevant regulations ofRules Governing the Listing of Securities on Shenzhen
Stock Exchangeand Articles of Association, Tibet Dongfeng is a related legal person of the company, and the stake
purchase matters constitute a related transaction.
This equity acquisition will help the company to expand new business, foster new profit growth points for the
company and enhance its sustainable development capability. This matter conforms to the long-term interests of
the company.
(2) The company signed an Equity Transfer Agreement with Mr. Wu Zhe that the company purchases 30% stock
equity of Dongfeng Technology held by Mr. Wu Zhe with 0 yuan. After the stake purchase, the company will
hold 100% stock equity of Dongfeng Technology Development.
As Mr. Wu Zhe is a director of the seventh board of directors of the company, according to the relevant
regulations of Stock Listing Rules of Shenzhen Stock Exchange and Articles of Association, Mr. Wu Zhe is a
related natural person of the company, and the stake purchase matters constitute a related transaction.
This equity acquisition and related transactions do not affect the company’s normal production and operation, and
is in line with the company’s future development needs. The equity acquisition is conducive to the structural
integration of the company’s hydrogen energy and new materials industry, can enhance the company’s core
competitiveness and sustainable development capabilities, and is in line with the company’s long-term interests.
5. Independent opinion on acquisition of assets sold
Acquisition and sales of the assets are runs in a reasonable price, no interest of part of the shareholders been
violated or assets of the Company loss been found.
6. Self-appraisal of internal control
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东沣科技集团股份有限公司 2018 年年度报告全文
In line with relevant regulation of CSRC and Shenzhen Stock Exchange, the Company follow basic principle of
internal control, according to actual condition, established and improved an internal control system that covers all
aspects of the Company, guarantee business activities operates normally, protect the safety and completion of
assets. In the reporting period, no situation of violation of Guideline of Internal Control for Listed Companies and
IC system of the Company been found. In conclusion, the supervisory committee considered that the
self-appraisal report of the internal control reflects a real, accurate condition of the Company in aspect of internal
control, therefore, supervisory show no objections.
VIII. Examination and incentives of senior management
Senior executives’ annual remuneration is paid monthly. They based on rules of salary management and level standard made by the
company. They made the remuneration case for senior manager based on the annual examination of their work ability, performance
and accomplishment of duty goals.
IX. Internal Control
1. Details of major defects in IC appraisal report that found in reporting period
□Yes √ No
2. Appraisal Report of Internal Control
Disclosure date of full internal control
13 April 2019
evaluation report
Disclosure index of full internal control
Juchao Website (www.cninfo.com.cn)
evaluation report
The ratio of the total assets of units
included in the scope of evaluation
accounting for the total assets on the 100.00%
company's consolidated financial
statements
The ratio of the operating income of units
included in the scope of evaluation
accounting for the operating income on the 100.00%
company's consolidated financial
statements
Defects Evaluation Standards
Category Financial Reports Non-financial Reports
(1) Major deficiencies: major violations (1) Major deficiencies: the company's
Qualitative criteria found in the company's financial statements, important businesses are lack of system
financial reports and information disclosure, control or have system failure, the
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东沣科技集团股份有限公司 2018 年年度报告全文
the company's audit committee and internal security of information systems has
audit service failed to effectively play their significant risks, and major deficiencies
supervision functions, the CPA issued there of internal control assessment are not
kinds of opinion reports to the company's rectified and reformed completely. (2)
financial statements except for clean Significant deficiencies: the company's
opinion. (2) Significant deficiencies: the general businesses are lack of system
establishment of the company's accounting control or have system failure, and the
statements and financial reports does not security of information systems has risks.
fully comply with the accounting standards (3) General deficiencies: other internal
for business enterprises and disclosure control deficiencies do not constitute
requirements, resulting in the material major or significant deficiencies.
misstatements of financial statements, the
company's financial reports declared in
previous years have material misstatements
and need to be retrospect and adjusted. (3)
General deficiencies: other internal control
deficiencies do not constitute major or
significant deficiencies.
(1) Amount of potential mistakes and
omissions in operating income: major
deficiencies: amount of mistakes and
omissions ≥ 3% of total operating income or
10 million Yuan; significant deficiencies: 1%
of total operating income or 5 million Yuan ≤
mistakes and omissions < 3% of total
operating income or 10 million Yuan;
general deficiencies: mistakes and omissions (1) Major deficiencies: direct property
< 1% of total operating income or 5 million loss ≥ 10 million Yuan, and punished by
Yuan. national authorities; (2) Significant
(2) Amount of potential mistakes and deficiencies: 5 million Yuan ≤ direct
omissions in expenses: major deficiencies: property loss < 10 million Yuan, and
Quantitative standard
amount of mistakes and omissions ≥ 3% of punished by the provincial government;
total expenses or 5 million Yuan; significant (3) General deficiencies: direct property
deficiencies: 2% of total expenses or 3 loss < 5 million Yuan, and punished by
million Yuan ≤ mistakes and omissions < 3% the municipal or below government.
of total expenses or 5 million Yuan; general
deficiencies: mistakes and omissions < 2%
of total expenses or 3 million Yuan.
(3) Amount of potential mistakes and
omissions in total assets: major deficiencies:
amount of mistakes and omissions ≥ 1% of
total assets or 30 million Yuan; significant
deficiencies: 0.5% of total assets or 20
million Yuan ≤ mistakes and omissions < 1%
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东沣科技集团股份有限公司 2018 年年度报告全文
of total assets or 30 million Yuan; general
deficiencies: mistakes and omissions < 0.5%
of total assets or 20 million Yuan.
Amount of significant defects in financial
0
reports
Amount of significant defects in
0
non-financial reports
Amount of important defects in financial
0
reports
Amount of important defects in
0
non-financial reports
X. Auditing report of internal control
√Applicable □ Not applicable
Deliberations in Audit Report of Internal Control
We consider that, according to relevant regulations and Basic Rules of Internal Control for Enterprise, Dongfeng Sic-Tech
maintained an efficiency internal control of financial report dated 31 December 2018, in all material aspects.
Disclosure details of audit report of
Disclosed
internal control
Disclosure date of audit report of
13 April 2019
internal control (full-text)
Index of audit report of internal
Juchao Website (www.cninfo.com.cn)
control (full-text)
Opinion type of auditing report of
Standard unqualified
IC
Whether the non-financial report
No
had major defects
Carried out modified opinion for internal control audit report from CPA
□Yes √ No
The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued from the Board
√ Yes □ No
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东沣科技集团股份有限公司 2018 年年度报告全文
Section X. Corporation bonds
Whether or not the Company public offering corporation bonds in stock exchange, which undue or without payment in full at
maturity on the approval date for annual report disclosed
No
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东沣科技集团股份有限公司 2018 年年度报告全文
Section XI. Financial Report
I. Audit report
Type of audit opinion Standard unqualified opinion
Signing date of audit report 11 April 2019
Name of audit institute Da Hua Certified Public Accountants (LLP)
Serial No. of audit report Da Hua Shen Zi[2019] No.: 004503
Name of CPA Hu Zhigang, Yan Lisheng
Text of Auditor’s Report
Auditor’s Report
Da Hua Shen Zi[2019] No.: 004503
To Shareholders of Dongfeng Sci-Tech Group CO., LTD.:
I. Auditor’s opinion
We, as the auditors, audited the financial statements of Dongfeng Sci-Tech Group CO., LTD. (the ―Company‖), which included the
consolidated balance sheet as of 31 December 2018, the consolidated statement of income, the consolidated statement of cash flow
and the consolidated statement of changes in equity of the Company for the year ended 31 December 2018, together with the relevant
notes thereto.
In our opinion, the Company’s financial statements have been prepared in accordance with the Enterprises Accounting Standards and
Enterprises Accounting System, and they fairly present the financial status of the Company and of its parent company as of 31
December 2018 and its operation results and cash flows for the year ended.
II. Basis of opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants of China. Our responsibilities
under those standards are further described in the ―Auditor’s Responsibilities for the Audit of the Financial Statements‖ section of the
auditor’s report. We are independent of the Company in accordance with the Certified Public Accountants of China’s Code of Ethics
for Professional Accountants, and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
III. Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial
statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and
in forming our opinion thereon, and we do not provide a separate opinion on these matters. The key audit matter we identified is as
follows:
We determine the following matters to be the key audit matters which require discussion in our audit report:
1. Confirmation of construction in progress;
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东沣科技集团股份有限公司 2018 年年度报告全文
2. Confirmation of real estate sales income.
(II) Confirmation of construction in progress
1. Description of the matter
Please refer to Note IV (16) and Note VI, Annotation 11 of the consolidated financial statements. As of December 31, 2018, the
balance of construction in progress in the consolidated financial statements of Dongfeng Technology Group was RMB
101,650,833.16, accounting for 16.26% of the total assets. The original value of new construction in progress during the period was
RMB 99,383,669.12.
Due to the importance of the construction in progress to the financial statements of Dongfeng Technology Group, and the
management of Dongfeng Technology Group has invested heavily in the construction in progress this year, we identified the
recognition and measurement of the construction in progress as a key audit matter.
2. Audit response
Our important audit procedures for the confirmation of construction in progress include:
(1) Understand and test the design and implementation of the internal control system and financial accounting system of Dongfeng
Technology Group related to the construction in progress.
(2) Obtain or prepare a detailed statement of construction in progress and impairment provision, check whether the statement is
correct, and whether it is consistent with the number of general account and the detailed account, and check whether it is consistent
with the impairment provision of the construction in progress and the number of statements.
(3) Consider the source, comparability, nature and relevance of the information available and the controls related to the compilation
of the information, and evaluate the reliability of the data used in anticipating the recording amount or rate.
(4) Calculate the capitalization amount of borrowing costs based on the borrowing and project construction, and compare it with the
actual capitalization of borrowing costs of the audited entity. Check if the interest capitalization is correct. Review the borrowing
costs, capitalization rate, and actual expenditures for calculating capitalized interest, and the start and stop time of capitalization
(5) Inquire the management about the increase in the construction in progress in the current year and check with the acquired or
compiled list of the construction in progress.
(6) Consult the company’s capital expenditure budget, company-related meeting resolutions, etc., and check whether all the
constructions in progress increased during the year are recorded.
(7) Check whether the original documents of the construction in progress increased during the year are complete, such as the
application for project approval, the project loan contract, the construction contract, the invoices, the application for purchase
requisition of engineering materials, the bills of payment, the construction contract, the waybill, the acceptance reports, etc., and
whether the valuation is right or not.
(8) Implement the on-site inspection procedures for construction in progress.
Based on the audit work performed, we have obtained the audit conclusion that the confirmation of the construction in progress of the
management of Dongfeng Technology Group is reasonable.
(ii) Recognition of property sales revenue
1. Description
Please refer to Note IV (26) and Note VI (30) of the consolidated financial statement. In 2018, the sales revenue for the period shown
in the consolidated financial statement of Dongfeng Sci-Tech Group is 123,508,083.90 Yuan, among which, 118,807,719.93 Yuan is
attributable to property development revenue accounting for 96.19%of the total revenue.
Since property development revenue is essential to the financial statements of Dongfeng Sci-Tech Group, we deem realization of
property development revenue as key audit matter.
2.Audit actions
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东沣科技集团股份有限公司 2018 年年度报告全文
(1)understand and test design and implementation of the internal control system and financial accounting system of Dongfeng
Sci-Tech Group relating to sales and collection.
(2)select property purchase and sale contract samples and have an interview with the management to evaluate whether the revenue
realization policies adopted by Dongfeng Sci-Tech Group for property development projects is in compliance with relevant
accounting standards.
(3)select property sales sample, review sales contract and other supporting documents which may serve as an evidence to prove the
property has met delivery conditions, so as to evaluate whether the property sales revenue has been realized under the revenue
realization policy of Dongfeng Sci-Tech Group.
(4)obtain from the relevant departments sales progress control sheet, sales record, filing with competent property management
authority, sales collection record and property hand-over procedures, so as to make a judgment on the actual sales and that whether
the sales complies with financial data.
(5)with respect to the property sales revenue realized from property development projects during the year, we selected samples and
compared its average selling price per square meter and the selling price per square meter available to us based on public information;
analyze the reasonableness of change in gross profit margin of the respective property projects.
(6)make cut-off test for revenue realization of property development projects; cross-check the sales revenue realized around the
balance sheet date and the supporting documents relating to delivery procedures, in order to assess whether revenue is realized during
the right periods.
Based on our audit works done and the audit evidence acquired, we made the audit conclusion that realization of sales revenue by the
management of Dongfeng Sci-Tech Group is in compliance with the accounting policies of the Company.
IV. Other information
The management of Dongfeng Sci-Tech Group CO., LTD. (the ―Management‖) is responsible for other information which includes
the information covered in the Company’s 2017 annual report excluding the financial statement and our audit report.
The audit opinion issued by us for the financial statement has not covered other information, for which we do not issue any form of
assurance opinions.
Considering our audit on financial statements, we are liable to read other information, during which, we shall consider whether other
information differs materially from the financial statements or that we understand during our audit, or whether there is any material
misstatement.
Based on the works executed by us, we should report the fact if we find any material misstatement in other information. In t his
regards, we have nothing to report.
V. Responsibilities of management and those charged with governance for the financial statements
The management is responsible for the preparation of the financial statements in accordance with the Accounting Standards for
Enterprise to secure a fair presentation, and for the design, establishment and maintenance of the internal control necessary to enable
the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company’s ability to continue as a going
concern, disclosing matters related to going concern and using the going concern assumption unless the management either intends to
liquidate the Company or to cease operations, or has no realistic alternative but to do so.
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东沣科技集团股份有限公司 2018 年年度报告全文
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
VI. Responsibilities of the auditor for the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an audit report that includes our audit opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit conducted in accordance with the CAS will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial
statements.
As part of an audit in accordance with the CAS, we exercise professional judgment and maintain professional skepticism throughout
the audit. We also:
(1)identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for audit
opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by the management.
(4) Conclude on the appropriateness of the management’s use of the going concern assumption and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s
ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required by the CAS to draw users’
attention in audit report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify audit
opinion. Our conclusions are based on the information obtained up to the date of audit report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the
financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the
Company to express audit opinion on the financial statements. We are responsible for the direction, supervision and performance of
the group audit. We remain solely responsible for audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our
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东沣科技集团股份有限公司 2018 年年度报告全文
independence, and where applicable, related safeguard measures.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in
the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in the
auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in the auditor’s report because of the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
(There is no text in this page, and it is the signature page of Dahua CPA (LLP) for auditing report 2018 under the name of Dongfeng
Sci-Tech Group Co., Ltd.)
DaHua CPA (LLP) Certified Public Accountant of China: Yan
Lisheng
(engagement partner)
Beijing, China Certified Public Accountant of China: Hu
Zhigang
11 April 2019
II. Financial Statement
Statement in Financial Notes are carried in RMB/CNY
1. Consolidated Balance Sheet
Prepared by Dongfeng Sci-Tech Group CO., LTD.
2018-12-31
In RMB
Item Closing balance Opening balance
Current assets:
Monetary fund 36,306,825.10 74,805,209.06
Settlement provisions
Capital lent
Financial assets measured by fair value and
with variation reckoned into current gains/losses
Derivative financial assets
Note receivable and account receivable 11,171.25 17,608.00
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东沣科技集团股份有限公司 2018 年年度报告全文
Including: Note receivable
Account receivable 11,171.25 17,608.00
Accounts paid in advance 61099009.67 183,595.06
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance receivable
Other account receivable 8,588,597.44 58,740,204.94
Including: Interest receivable
Dividend receivable
Buying back the sale of financial assets
Inventory 151,585,557.50 234,653,825.84
Assets held for sale
Non-current asset due within one year
Other current assets 37,786,874.66 34,559,505.29
Total current assets 295378035.62 402,959,948.19
Non-current assets:
Loans and payments on behalf
Finance asset available for sales 16,331,037.08 16,670,403.13
Held-to-maturity investment
Long-term account receivable
Long-term equity investment
Investment real estate 4,236,346.34
Fixed assets 17,302,279.65 9,674,396.99
Construction in process 101,650,833.16 2,267,164.04
Productive biological asset 121,437.50 17,971.39
Oil and gas asset
Intangible assets 56,686,960.59 51,705,311.04
Expense on Research and Development 13,346,410.47 3,513,561.56
Goodwill 1,543,786.41 1,294,711.56
Long-term expenses to be apportioned 266,884.56 219,963.84
Deferred income tax asset 775,645.41
Other non-current asset 121743152.36 10,427,021.55
Total non-current asset 328992781.78 100,802,496.85
Total assets 624,370,817.40 503,762,445.04
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东沣科技集团股份有限公司 2018 年年度报告全文
Current liabilities:
Short-term loans
Loan from central bank
Absorbing deposit and interbank deposit
Capital borrowed
Financial liability measured by fair value and
with variation reckoned into current gains/losses
Derivative financial liability
Note payable and account payable 6,668,789.67 15,487,833.06
Accounts received in advance 16,269,319.99 64,165,709.37
Selling financial asset of repurchase
Commission charge and commission payable
Wage payable 981,089.59 2,201,668.93
Taxes payable 921,967.58 13,171,059.13
Other account payable 118,570,218.85 25,952,193.34
Including: Interest payable 193,333.41
Dividend payable
Reinsurance payable
Insurance contract reserve
Security trading of agency
Security sales of agency
Liability held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 143,411,385.68 120,978,463.83
Non-current liabilities:
Long-term loans 101,710,000.00
Bonds payable
Including: preferred stock
Perpetual capital securities
Long-term account payable
Long-term wages payable
Accrual liability
Deferred income
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东沣科技集团股份有限公司 2018 年年度报告全文
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 101,710,000.00
Total liabilities 245,121,385.68 120,978,463.83
Owner’s equity:
Share capital 706,320,000.00 706,320,000.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital public reserve 463,681,309.55 463,681,309.55
Less: Inventory shares 19,718,613.55
Other comprehensive income
Reasonable reserve
Surplus public reserve 76,791,550.17 76,791,550.17
Provision of general risk
Retained profit -875,480,247.09 -882,864,082.85
Total owner’s equity attributable to parent company 351,593,999.08 363,928,776.87
Minority interests 27,655,432.64 18,855,204.34
Total owner’s equity 379,249,431.72 382,783,981.21
Total liabilities and owner’s equity 624,370,817.40 503,762,445.04
Legal Representative:Zhao Yongsheng
Person in charge of accounting works:Zhao Yongsheng
Person in charge of accounting institute: Liu Fengguo
2. Balance Sheet of Parent Company
In RMB
Item Closing balance Opening balance
Current assets:
Monetary fund 28,933,135.09 12,091,839.66
Financial assets measured by fair value and with
variation reckoned into current gains/losses
Derivative financial assets
Note receivable and account receivable
79
东沣科技集团股份有限公司 2018 年年度报告全文
Including: Note receivable
Account receivable
Accounts paid in advance 60,821,190.73 5,000.33
Other account receivable 80,991,042.06 27,954,251.88
Including: Interest receivable
Dividend receivable
Inventory 150,581,753.98 234,077,374.89
Assets held for sale
Non-current asset due within one year
Other current assets 24,163,071.63 1,709,204.34
Total current assets 345,490,193.49 275,837,671.10
Non-current assets:
Finance asset available for sales 16,331,037.08 16,670,403.13
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 272,803,036.40 248,114,466.37
Investment real estate
Fixed assets 1,551,517.36 1,826,078.88
Construction in process
Productive biological asset
Oil and gas asset
Intangible assets
Expense on Research and Development
Goodwill
Long-term expenses to be apportioned
Deferred income tax asset 750.00
Other non-current asset
Total non-current asset 290,685,590.84 266,611,698.38
Total assets 636,175,784.33 542,449,369.48
Current liabilities:
Short-term loans
Financial liability measured by fair value and
with variation reckoned into current gains/losses
Derivative financial liability
80
东沣科技集团股份有限公司 2018 年年度报告全文
Note payable and account payable 6,263,184.67 15,157,800.54
Accounts received in advance 14,427,450.03 62,427,764.58
Wage payable 257,362.42 596,118.22
Taxes payable 125,482.71 43,262.13
Other account payable 432,985,336.27 325,994,266.48
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 454,058,816.10 404,219,211.95
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred stock
Perpetual capital securities
Long-term account payable
Long-term wages payable
Accrual liability
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 454,058,816.10 404,219,211.95
Owner’s equity:
Share capital 706,320,000.00 706,320,000.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital public reserve 456,569,124.55 456,569,124.55
Less: Inventory shares 19,718,613.55
Other comprehensive income
Reasonable reserve
Surplus public reserve 76,791,550.17 76,791,550.17
81
东沣科技集团股份有限公司 2018 年年度报告全文
Retained profit -1,037,845,092.94 -1,101,450,517.19
Total owner’s equity 182,116,968.23 138,230,157.53
Total liabilities and owner’s equity 636,175,784.33 542,449,369.48
3. Consolidated Profit Statement
In RMB
Item Current period Last period
I. Total operating income 123,508,083.90 250,071,863.07
Including: Operating income 123,508,083.90 250,071,863.07
Interest income
Insurance gained
Commission charge and
commission income
II. Total operating cost 142,663,266.21 298,891,792.83
Including: Operating cost 108,747,731.24 237,183,139.67
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of compensation
Net amount of withdrawal of insurance
contract reserve
Bonus expense of guarantee slip
Reinsurance expense
Tax and extras -247,832.89 9,791,294.48
Sales expense 115,346.71 14,417,090.26
Management expense 29,236,648.47 29,552,371.61
R&D expense 4,748,852.86 124,889.69
Financial expense -385,552.98 1,346,177.29
Including: Interest expenses
Interest income 175,090.92 645,550.99
Losses of devaluation of asset 448,072.80 6,476,829.83
Add: Other income 2,896,903.64
Investment income (Loss is listed
19,646,046.57 1,501,873.01
with ―-‖
82
东沣科技集团股份有限公司 2018 年年度报告全文
Including: Investment income on
affiliated company and joint venture
Income from change of fair value
(Loss is listed with ―-‖)
Exchange income (Loss is listed with
―-‖)
Income from assets disposal (Loss is
4,526,245.58 65,059,983.64
listed with ―-‖)
III. Operating profit (Loss is listed with ―-‖) 7,914,013.48 17,741,926.89
Add: Non-operating revenue 3,125.00 24,633.24
Less: Non-operating expenditure 473,944.42 823,362.54
IV. Total Profit (Loss is listed with ―-‖) 7,443,194.06 16,943,197.59
Less:Income tax expense 885,955.09 12,906,984.10
V. Net profit (Net loss is listed with ―-‖) 6,557,238.97 4,036,213.49
(i) net profit from continuous operation
10,617,300.84 4,124,362.74
(Net loss is listed with ―-‖)
(ii) net profit from discontinued operation
-4,060,061.87 -88,149.25
(Net loss is listed with ―-‖)
Net profit attributable to owner’s of parent
7,383,835.76 4,102,325.89
company
Minority shareholders’ gains and losses -826,596.79 -66,112.40
VI. Net amount of other comprehensive income
after-tax
Net after-tax of other comprehensive income
attributable to owners of parent company
(i) Other comprehensive income items
which will not be reclassified subsequently to
gain/loss
1.Re-measurement of the change of
defined benefit plan
2.Other comprehensive income
unable transfer to gain/loss under equity method
(II) Other comprehensive income items
which will be reclassified subsequently to profit
or loss
1.Other comprehensive income
able to transfer to gain/loss under equity method
2.Gains or losses arising from
83
东沣科技集团股份有限公司 2018 年年度报告全文
changes in fair value of available-for-sale
financial assets
3.Gains or losses arising from
reclassification of held-to-maturity investment
as available-for-sale financial assets
4.The effect hedging portion of
gains or losses arising from cash flow hedging
instruments
5.Translation differences arising on
translation of foreign currency financial
statements
6. Other
Net amount of other comprehensive income
after-tax attributable to minority shareholders
VII. Total comprehensive income 6,557,238.97 4,036,213.49
Total comprehensive income attributable to
7,383,835.76 4,102,325.89
owners of parent Company
Total comprehensive income attributable to
-826,596.79 -66,112.40
minority shareholders
VIII. Earnings per share:
(i) Basic earnings per share 0.01 0.01
(ii) Diluted earnings per share 0.01 0.01
As for the enterprise combined under the same control, net profit of Yuan achieved by the merged party before combination while Yuan achieved last period
Legal Representative:Zhao Yongsheng
Person in charge of accounting works:Zhao Yongsheng
Person in charge of accounting institute: Liu Fengguo
4. Profit Statement of Parent Company
In RMB
Item Current period Last period
I. Operation income 121,071,870.89 252,808,109.87
Less: Operating cost 103,821,248.79 231,621,565.96
Tax and extras -1,521,613.57 8,783,840.21
Sales expense 110,444.59 14,255,025.45
84
东沣科技集团股份有限公司 2018 年年度报告全文
Management expense 12,121,942.53 14,477,838.05
R&D expense
Financial expense 2,590.40 -23,760.83
Including: Interest expenses
Interest income
Losses of devaluation of asset -530,281.37 24,023,352.93
Add: Other income 2,890,000.00
Investment income (Loss is listed
53,773,285.06
with ―-‖
Including: Investment income on
affiliated company and joint venture
Income from change of fair value
(Loss is listed with ―-‖)
Income from assets disposal (Loss is
listed with ―-‖)
II. Operating profit (Loss is listed with ―-‖) 63,730,824.58 -40,329,751.90
Add: Non-operating revenue 0.04
Less: Non-operating expenditure 124,650.33 75,323.27
III. Total Profit (Loss is listed with ―-‖) 63,606,174.25 -40,405,075.13
Less:Income tax expense 750.00
IV. Net profit (Net loss is listed with ―-‖) 63,605,424.25 -40,405,075.13
(i) net profit from continuous operation
63,605,424.25 -40,405,075.13
(Net loss is listed with ―-‖)
(ii) net profit from discontinued operation
(Net loss is listed with ―-‖)
V. Net amount of other comprehensive income
after-tax
(i) Other comprehensive income items
which will not be reclassified subsequently to
gain/loss
1.Re-measurement of the change of
defined benefit plan
2.Other comprehensive income
unable transfer to gain/loss under equity method
(II) Other comprehensive income items
which will be reclassified subsequently to profit
or loss
85
东沣科技集团股份有限公司 2018 年年度报告全文
1.Other comprehensive income
able to transfer to gain/loss under equity method
2.Gains or losses arising from
changes in fair value of available-for-sale
financial assets
3.Gains or losses arising from
reclassification of held-to-maturity investment
as available-for-sale financial assets
4.The effect hedging portion of
gains or losses arising from cash flow hedging
instruments
5.Translation differences arising on
translation of foreign currency financial
statements
7. Other
VI. Total comprehensive income 63,605,424.25 -40,405,075.13
VII. Earnings per share:
(i) Basic earnings per share
(ii) Diluted earnings per share
5. Consolidated Cash Flow Statement
In RMB
Item Current period Last period
I. Cash flows arising from operating activities:
Cash received from selling commodities
84,460,974.01 77,634,880.19
and providing labor services
Net increase of customer deposit and
interbank deposit
Net increase of loan from central bank
Net increase of capital borrowed from
other financial institution
Cash received from original insurance
contract fee
Net cash received from reinsurance business
Net increase of insured savings and
investment
Net increase of amount from disposal
86
东沣科技集团股份有限公司 2018 年年度报告全文
financial assets that measured by fair value and
with variation reckoned into current
gains/losses
Cash received from interest, commission
charge and commission
Net increase of capital borrowed
Net increase of returned business capital
Write-back of tax received 8,101,715.65 7,012,138.87
Other cash received concerning operating
116131170.58 23,844,761.80
activities
Subtotal of cash in-flow from operation activity 208693860.24 108,491,780.86
Cash paid for purchasing commodities and
123728104.36 126,145,604.98
receiving labor service
Net increase of customer loans and
advances
Net increase of deposits in central bank
and interbank
Cash paid for original insurance contract
compensation
Cash paid for interest, commission charge
and commission
Cash paid for bonus of guarantee slip
Cash paid to/for staff and workers 16697226.16 16,357,414.95
Taxes paid 32,848,901.70 8,733,973.58
Other cash paid concerning operating
853,578.71 41,806,361.63
activities
Subtotal of cash out-flow from operation
174,127,810.93 193,043,355.14
activity
Net cash flow arising from operating activities 34,566,049.31 -84,551,574.28
II. Cash flows arising from investing activities:
Cash received from recovering investment 31,230,000.00 105,000,000.00
Cash received from investment income 680926.85 2,490,847.27
Net cash received from disposal of fixed,
28,160,000.00 87,025,400.00
intangible and other long-term assets
Net cash received from disposal of
17,328,070.03
subsidiaries and other units
Other cash received concerning investing
87
东沣科技集团股份有限公司 2018 年年度报告全文
activities
Subtotal of cash in-flow from investment
77,398,996.88 194,516,247.27
activity
Cash paid for purchasing fixed, intangible
231847353.86 53,549,390.18
and other long-term assets
Cash paid for investment 1500000 130,030,000.00
Net increase of mortgaged loans
Net cash received from subsidiaries and
-6,604,668.64 -6,179,984.99
other units obtained
Other cash paid concerning investing
-----
activities
Subtotal of cash out-flow from investment
226,742,685.22 177,399,405.19
activity
Net cash flow from investment activity -149,343,688.34 17,116,842.08
III. Cash flows arising from financing activities
Cash received from absorbing investment 9,600,000.00
Including: Cash received from absorbing
minority shareholders’ investment by 9,600,000.00
subsidiaries
Cash received from loans 101,710,000.00
Cash received from issuing bonds
Other cash received concerning financing
activities
Subtotal of cash in-flow from financing activity 101,710,000.00 9,600,000.00
Cash paid for settling debts
Cash paid for dividend and profit
2,077,900.24
distributing or interest paying
Including: Dividend and profit of minority
shareholder paid by subsidiaries
Other cash paid concerning financing
19,718,613.55 698,492.97
activities
Subtotal of cash out-flow from financing
21,796,513.79 698,492.97
activity
Net cash flow from financing activity 79,913,486.21 8,901,507.03
IV. Influence on cash and cash equivalents due
269,681.12 -330,220.97
to fluctuation in exchange rate
V. Net increased amount of cash and cash -34,594,471.70 -58,863,446.14
88
东沣科技集团股份有限公司 2018 年年度报告全文
equivalent
Add: Balance of cash and cash equivalents
68,107,388.69 126,970,834.83
at the period -begin
VI. Balance of cash and cash equivalents at the
33,512,916.99 68,107,388.69
period -end
6. Cash Flow Statement of Parent Company
In RMB
Item Current period Last period
I. Cash flows arising from operating activities:
Cash received from selling commodities
79,011,942.34 72,881,435.81
and providing labor services
Write-back of tax received 86,715.65 7,012,138.87
Other cash received concerning operating
124344882.32 217,554,262.24
activities
Subtotal of cash in-flow from operation activity 203,443,540.31 297,447,836.92
Cash paid for purchasing commodities and
106,587,804.23 121,926,111.90
receiving labor service
Cash paid to/for staff and workers 5,445,538.85 6,029,524.99
Taxes paid 9,232,241.12 7,703,760.87
Other cash paid concerning operating
65,454,115.32 152,397,541.00
activities
Subtotal of cash out-flow from operation
186,719,699.52 288,056,938.76
activity
Net cash flow arising from operating activities 16,723,840.79 9,390,898.16
II. Cash flows arising from investing activities:
Cash received from recovering investment
Cash received from investment income 36445215.03
Net cash received from disposal of fixed,
3,678,200.00
intangible and other long-term assets
Net cash received from disposal of
17,328,070.03
subsidiaries and other units
Other cash received concerning investing
activities
Subtotal of cash in-flow from investment
53,773,285.06 3,678,200.00
activity
Cash paid for purchasing fixed, intangible 33,304.61 358,389.88
89
东沣科技集团股份有限公司 2018 年年度报告全文
and other long-term assets
Cash paid for investment 30,000,000.00 70,000,000.00
Net cash received from subsidiaries and
other units obtained
Other cash paid concerning investing
activities
Subtotal of cash out-flow from investment
30,033,304.61 70,358,389.88
activity
Net cash flow from investment activity 23,739,980.45 -66,680,189.88
III. Cash flows arising from financing activities
Cash received from absorbing investment
Cash received from loans
Cash received from issuing bonds
Other cash received concerning financing
activities
Subtotal of cash in-flow from financing activity
Cash paid for settling debts
Cash paid for dividend and profit
distributing or interest paying
Other cash paid concerning financing
19,718,613.55 698,492.97
activities
Subtotal of cash out-flow from financing
19,718,613.55 698,492.97
activity
Net cash flow from financing activity -19,718,613.55 -698,492.97
IV. Influence on cash and cash equivalents due
to fluctuation in exchange rate
V. Net increased amount of cash and cash
20,745,207.69 -57,987,784.69
equivalent
Add: Balance of cash and cash equivalents
5,394,019.29 63,381,803.98
at the period -begin
VI. Balance of cash and cash equivalents at the
26,139,226.98 5,394,019.29
period -end
7. Statement of Changes in Owners’ Equity (Consolidated)
Current period
In RMB
Item Current period
90
东沣科技集团股份有限公司 2018 年年度报告全文
Owners’ equity attributable to parent company
Other equity instrument
Other Total
Perpetu Minority
Capital Less: Surplus Provision
Share comprehe Reasonab Retained owner’s
Preferr al interests
public Inventory public of general
capital nsive le reserve profit equity
ed capital Other
reserve shares reserve risk
stock securiti income
es
I. Balance at the end 706,320 463,681,3 76,791,55 -882,864, 18,855,20 382,783,9
of the last year ,000.00 09.55 0.17 082.85 4.34 81.21
Add: Changes of
accounting policy
Error
correction of the last
period
Enterprise
combined under the
same control
Other
II. Balance at the 706,320 463,681,3 76,791,55 -882,864, 18,855,20 382,783,9
beginning of this year ,000.00 09.55 0.17 082.85 4.34 81.21
III. Increase/ Decrease
19,718,61 7,383,835 8,800,228 -3,534,54
in this year (Decrease
3.55 .76 .30 9.49
is listed with ―-‖)
(i) Total
7,383,835 -826,596. 6,557,238
comprehensive
.76 79 .97
income
(ii) Owners’ devoted 19,718,61 9,626,825 -10,091,7
and decreased capital 3.55 .09 88.46
1. Common shares
invested by owners
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity
with share-based
payment
19,718,61 9,626,825 -10,091,7
4. Other
3.55 .09 88.46
91
东沣科技集团股份有限公司 2018 年年度报告全文
(III) Profit distribution
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk provisions
3. Distribution for
owners (or
shareholders)
4. Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4. Change amount of
defined benefit plans
that carry forward
retained earnings
5. Other
(v) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(vi) Other
IV. Balance at the end 706,320 463,681,3 19,718,61 76,791,55 -875,480, 27,655,43 379,249,4
of the report period ,000.00 09.55 3.55 0.17 247.09 2.64 31.72
Last period
In RMB
Last period
Owners’ equity attributable to parent company
Total
Item Minority
Share Other equity instrument Capital Less: Other Reasonab Surplus Provision Retained owner’s
interests
capital Preferr Perpetu Other public Inventory comprehe le reserve public of general profit equity
92
东沣科技集团股份有限公司 2018 年年度报告全文
ed al reserve shares nsive reserve risk
stock capital income
securiti
es
I. Balance at the end 706,320 463,681,3 76,791,55 -886,966, 2,349,55 362,176,0
of the last year ,000.00 09.55 0.17 408.74 8.95 09.93
Add: Changes of
accounting policy
Error
correction of the last
period
Enterprise
combined under the
same control
Other
II. Balance at the 706,320 463,681,3 76,791,55 -886,966, 2,349,55 362,176,0
beginning of this year ,000.00 09.55 0.17 408.74 8.95 09.93
III. Increase/ Decrease
4,102,325 16,505,6 20,607,97
in this year (Decrease
.89 45.39 1.28
is listed with ―-‖)
(i) Total
4,102,325 -66,112.4 4,036,213
comprehensive
.89 0 .49
income
(ii) Owners’ devoted 16,571,7 16,571,75
and decreased capital 57.79 7.79
1. Common shares 16,571,7 16,571,75
invested by owners 57.79 7.79
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity
with share-based
payment
4．Other
(III) Profit distribution
1. Withdrawal of
surplus reserves
2. Withdrawal of
93
东沣科技集团股份有限公司 2018 年年度报告全文
general risk provisions
3. Distribution for
owners (or
shareholders)
4．Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4. Change amount of
defined benefit plans
that carry forward
retained earnings
5．Other
(v) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(vi) Other
IV. Balance at the end 706,320 463,681,3 76,791,55 -882,864, 18,855,2 382,783,9
of the report period ,000.00 09.55 0.17 082.85 04.34 81.21
8. Statement of Changes in Owners’ Equity (Parent Company)
Current period
In RMB
Current period
Other equity instrument
Capital Less: Other Surplus Total
Item Share Reasonable Retained
Perpetual
Preferred public Inventory comprehens public owner’s
capital capital Other reserve profit
stock reserve shares ive income reserve equity
securities
I. Balance at the end 706,320,0 456,569,12 76,791,550. -1,101,45 138,230,15
94
东沣科技集团股份有限公司 2018 年年度报告全文
of the last year 00.00 4.55 17 0,517.19 7.53
Add: Changes of
accounting policy
Error
correction of the last
period
Other
II. Balance at the 706,320,0 456,569,12 76,791,550. -1,101,45 138,230,15
beginning of this year 00.00 4.55 17 0,517.19 7.53
III. Increase/ Decrease
19,718,613. 63,605,42 43,886,810.
in this year (Decrease
55 4.25 70
is listed with ―-‖)
(i) Total
63,605,42 63,605,424.
comprehensive
4.25 25
income
(ii) Owners’ devoted 19,718,613. -19,718,613
and decreased capital 55 .55
1. Common shares
invested by owners
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity
with share-based
payment
19,718,613. -19,718,613
4．Other
55 .55
(III) Profit distribution
1. Withdrawal of
surplus reserves
2．Distribution for
owners (or
shareholders)
3．Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
95
东沣科技集团股份有限公司 2018 年年度报告全文
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4. Change amount of
defined benefit plans
that carry forward
retained earnings
5．Other
(v) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(vi) Other
IV. Balance at the end 706,320,0 456,569,12 19,718,613. 76,791,550. -1,037,84 182,116,96
of the report period 00.00 4.55 55 17 5,092.94 8.23
Last period
In RMB
Last period
Other equity instrument
Capital Less: Other Surplus Total
Item Share Reasonable Retained
Perpetual
Preferred public Inventory comprehens public owner’s
capital capital Other reserve profit
stock reserve shares ive income reserve equity
securities
I. Balance at the end 706,320,0 456,569,12 76,791,550. -1,061,04 178,635,23
of the last year 00.00 4.55 17 5,442.06 2.66
Add: Changes of
accounting policy
Error
correction of the last
period
Other
II. Balance at the 706,320,0 456,569,12 76,791,550. -1,061,04 178,635,23
beginning of this year 00.00 4.55 17 5,442.06 2.66
III. Increase/ Decrease -40,405,0 -40,405,075
in this year (Decrease 75.13 .13
96
东沣科技集团股份有限公司 2018 年年度报告全文
is listed with ―-‖)
(i) Total
-40,405,0 -40,405,075
comprehensive
75.13 .13
income
(ii) Owners’ devoted
and decreased capital
1. Common shares
invested by owners
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity
with share-based
payment
4．Other
(III) Profit distribution
1. Withdrawal of
surplus reserves
2．Distribution for
owners (or
shareholders)
3．Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4. Change amount of
defined benefit plans
that carry forward
retained earnings
5．Other
(v) Reasonable reserve
97
东沣科技集团股份有限公司 2018 年年度报告全文
1. Withdrawal in the
report period
2. Usage in the report
period
(vi) Other
IV. Balance at the end 706,320,0 456,569,12 76,791,550. -1,101,45 138,230,15
of the report period 00.00 4.55 17 0,517.19 7.53
III. Company profile
(i) Registered place, organization structure and head office of the Company
Dongfeng Sci-Tech. Group Co., Ltd. (Hereinafter referred to as Dongfeng Sci-Tech. Group or the Company) was formerly known as
Chengde Dixian Knitting Co., Ltd., and was reorganized on 3 November 1999 by sponsorship, approved by the People's Government
of Hebei Province with the issue of Ji Gu Ban [1999] No.: 36 with license of the business corporation obtained from Hebei
Administration for Industry & Commerce; registered capital while established amounting as RMB 100,000,000, and RMB 1.00 per
share. Among the abovementioned, RMB 85.10 million contributed by Wang Shuxian, representing 7.56 percent of the registered
capital; Wang Zhengsong invested RMB 5.4444 million with 5.44 percent in total registered capital presented; Chengde Longfeng
Cosmetics Co., Ltd. contributed RMB 0.9456 million, a 0.95 percent in registered capital and RMB 0.9456 million contributed by
Chengde Xiabancheng Hongxing Plastics Products Plant with 0.95 percent in registered capital presented.
On 29 August 2000, according to the Zheng Jian Fa Xing Zi [2000] No.: 121 issued by the China Securities Regulatory Commission,
the Company issued 100,000,000 domestically listed foreign shares in Shenzhen Stock Exchange dated 19 September 2000; and
excised the over-allotment option to increase issuing 15,000,000 B shares from September 29, 2000 to October 29, 2000. The
registered capital of the Company after the issuance of B shares was RMB 215,000,000 with one Yuan of face value per share.
According to the resolution of the shareholder’s general meeting on March 12, 2002, the Company allotted 43,000,000 bonus shares
to all of the shareholders according to the proportion of 2 free shares for every 10 shares, and meanwhile increased 107,500,000
shares to all of the shareholding by transferring from capital reserve according to 5 shares free for every 10 shares. The registered
capital of the company was changed to RMB 365,500,000 after it allotted bonus shares and increased by transferring.
According to the resolution of the shareholder’s general meeting on July 22, 2003, the Company allotted 73,100,000 bonus shares to
all of the shareholders according to the proportion of 2 free shares for every 10 shares, and the registered capital of the company was
changed to RMB 438,600,000 after such bonus shares were allotted.
On March 11, 2004, approved by the Ministry of Commerce of the People's Republic of China, the Company was allowed to be
changed as a foreign investment limited liability company.
In July 2004, the Company increased 150,000,000 B shares directionally, during which 91,300,000 shares were subscribed in HK$,
and another 58,700,000 shares were subscribed in RMB, upon check by China Securities Regulatory Commission with the issue
[2004] No.101.
According to the resolution of the shareholder’s general meeting on June 8, 2006, the Company allotted 117,720,000 bonus shares to
all of the shareholders according to the proportion of 2 free shares for every 10 shares,
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On August 4, 2008, according to the judgment ruled by Shenzhen Intermediate People's Court, 112,324,800 sponsor shares held by
Wang Shuxian was compensated to Chen Rong for 45,491,544 Yuan, and on August 15, 2008, 96,000,000 sponsor shares held by
Wang Shuxian was compensated to Chen Rong for 38,880,000 Yuan according to the judgment ruled by Dalian Intermediate
People's Court.
On November 11, 2009, according to ―reply to the approval of capital increase, and change of share as well as name of Chengde
Dixian Knitting Co., Ltd‖ with No.143 [2009] by Bureau of Commerce of Hebei Province, it agreed that the Company increased
150,000,000 domestically listed foreign shares in 2004 and allotted 2 bonus shares free for every 10 shares in 2006; and it agreed that
208,324,800 shares of Dixian stock held by Wang Shuxian was changed to Chen Rong ; as well as the name of the Company changed
to Chengde Dalu Co., Ltd. Total share capital of the Company was 706,320,000 shares and the registered capital of the Company was
706,320,000 Yuan after the Company’s share increased and allotted,
On 23 August 2011, the Company received the enterprise corporate business license issued from Chengde Administration for
Industry and Commerce, register serial was No.: 130000400001225; registered capital and paid-up capital was 706.32 million Yuan
with corporate type of limited liability company (Sino-foreign joint venture, listed)
On April 6, 2012, Chen Rong, shareholder of Company, signed a share transfer agreement with Mr. Wang Dong for transferred all of
the 208,324,800 shares held by himself (accounting for 29.49% of total capital of the Company) to Mr. Wang Dong; After equity
transfer the above mentioned, capital contribution proportion of the shareholders of the Company were: 208.3248 million Yuan
invested by Wang Dong, representing 29.49 percent of the register capital; 18517651 Yuan contributed by Hebei Chengde Northern
Industrial Corporation, representing 2.62 percent of the register capital; 13327891 Yuan invested by Wang Zhengsong, a 0.33 percent
in register capital; 2314829 Yuan invested by Chengde Xiabancheng Hongxing Plastics Products Plant, a 0.33 percent in register
capital and 461.52 million Yuan contributed by shareholders of domestically listed foreign shares, representing 65.34 percent of the
register capital.
On 19 September 2012, being verified and approved by Chengde Administration for Industry and Commerce, the Company’s name
changed as Chengde Nanjiang Co., Ltd.
On 15 May 2017, being verified and approved by Chengde Administration for Industry and Commerce, the Company’s name
changed as Dongfeng Sci-Tech Group Co., Ltd
Over the years of bonus issue, rights issue and capitalization, up to 31st December 2017, the issued shares totally amounting to
706.32 million shares, registered capital of the Company was 706.32 million Yuan; registered address: Xiabancheng Town, Chengde
County, Hebei Province; HQ: Xiabancheng Town, Chengde County, Hebei Province. The Company has no parent company and Mr.
Wang Dong is the first largest shareholder of the Company and also is the controller of the Company.
(ii) Business scope
R&D and sales of new energy, and new material products as well as technology promotion and technical service; scientific research
of modern ecological agriculture and technology promotion service, wholesales of ecological agriculture products; import and export
trade of goods and technology; Engage in the real estate development and management in the scope approved by the qualification
certificates; property management.
(iii) Business nature and main operating activities of the Company
Dongfeng Sci-Tech Group belongs to the development operation of real estate business, subsidy engaged in new energy, new
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materials,property management and agricultural farming and breeding
(iv) Report approval for the financial statement
The statement has been approved by all Directors of the Company dated 11 April 2019 for reporting.
(v) Consolidation scope for the financial statement
Totally 17 subjects are included in consolidate financial statement, mainly including the follow except the Company:
Shareholding ratio
Subsidiaries Type Level Voting rights ratio (%)
(%)
Chengde Nanjiang Trading Co., Ltd.(hereinafter referred to as Wholly-owned 1 100.00 100.00
―Nanjiang Trading‖) subsidiary
Chengde Kefeng Engineering Project Management Co. Wholly-owned 1 100.00 100.00
Ltd.(hereinafter referred to as―Kefeng Engineering‖) subsidiary
Chengde Dongfeng Investment Co., Ltd.(hereinafter referred Wholly-owned 1 100.00 100.00
to as―Dongfeng Investment ‖) subsidiary
Nanjiang Asia Investment Co., Ltd.(hereinafter referred to Wholly-owned 1 100.00 100.00
as―Nanjiang Asia ‖) subsidiary
Chengde Kefeng Trading Co., Ltd.(hereinafter referred to Wholly-owned 1 100.00 100.00
as―Kefeng Trading‖) subsidiary
Hangzhou Dongfeng Technology Co. Ltd.(hereinafter referred Wholly-owned 1 100.00 100.00
to as―Hangzhou Dongfeng‖) subsidiary
Dongguan Dongfeng Technology Development Co., Controlling 1 100.00 100.00
Ltd.(hereinafter referred to as―Dongguan Dongfeng subsidiary
Technology‖)
Chengde Kefeng Aerospace Technology Development Co. Wholly-owned 1 100.00 100.00
Ltd(hereinafter referred to as―Kefeng Aerospace‖) subsidiary
Dongguan Dongfeng Power Tech. Co., Ltd. (hereinafter Controlling 1 100.00 100.00
referred to as―Dongfeng Power ‖) subsidiary
Chengde Dongfeng Ecological Agriculture Co., Wholly-owned 2 100.00 100.00
Ltd.(hereinafter referred to as―Ecological Agriculture ‖) sub-subsidiary
Chengde Nanjiang Technology Co. Ltd.(hereinafter referred to Wholly-owned 2 100.00 100.00
as―Nanjiang Technology‖) sub-subsidiary
Chengde Huijing Property Services Co., Ltd.(hereinafter Wholly-owned 2 100.00 100.00
referred to as―Huijing Property‖) sub-subsidiary
Dongguan Zhongchuang New Energy Technology Co., Controlling 2 60.98 60.98
Ltd.(hereinafter referred to as―Zhongchuang New Energy‖) sub-subsidiary
Dongguan Dongfeng Intelligent Technology Co., Wholly-owned 2 100.00 100.00
Ltd.(hereinafter referred to as―Dongguan Dongfeng sub-subsidiary
Intelligent‖)
Dongguan Aolin New Materials Co., Ltd.(hereinafter referred Controlling 2 62.00 62.00
to as―Aolin New Materials ‖) sub-subsidiary
Dongguan Haizhuo Energy Technology Co., Ltd.(hereinafter Controlling 2 62.00 62.00
referred to as―Haizhuo Energy‖) sub-subsidiary
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(1) The Company transferred its 100% equity of NanjiangTrading to Chengde Country Jinshangmao Co., Ltd on August 14, 2018,
therefore, Nanjiang Trading was no longer included in the consolidated balance sheet in the current period, but the Accounting
Standards for Business Enterprises No. 33 – Consolidated Financial Statements stipulates that if a parent company disposes of a
subsidiary during the reporting period, the income, expenses and profits of the subsidiary from the beginning of the period to the
disposal date should be included in the consolidated income statement, and the cash flows of the subsidiary from the beginning of the
period to the disposal date should be included in the consolidated cash flow statement. Therefore, the income, expenses and profits of
NanjiangTrading from the beginning of the current period to the date of cancellation were still included in the scope of consolidation.
(2) Dongguan Dongfeng Power Tech. Co., Ltd. is a holding sub-subsidiary acquired on August 28, 2018. On December 25, 2018,
Dongguan Dongfeng Tech. transferred it to the Company to become a holding subsidiary.
(3) Dongguan Haizhuo Energy Technology Co., Ltd. is a holding sub-subsidiary that increased its capital and shares on March 6,
2018.
1. Subsidiary newly included in consolidation scope in the period
Name Causes
Dongfeng Power Enterprise combined under the same control
Haizhuo Energy Enterprise combined under the different control
2. In the period, there were no new special purpose entity and operation entity that with control resulted through entrust operation or
leasing newly included in consolidation scope
3. Subsidiary excluded in the consolidation scope in the period
Name Causes
Nanjiang Trading Disposal
4. In the period, there were no special purpose entity and operation entity that with control resulted through entrust operation or
leasing not included in consolidation scope any more
5. Specific change of the entity in consolidation scope found more in Change of Consolation Scope in Note VIII
IV. Basis of preparation of financial statements
1. Preparation basis
The Company conducts recognition and measurement according to actual occurrence of transactions and issues, pursuant to the
Accounting Standards for Business Enterprises- Basic Standard and specific accounting principle as well as the application guidance
for the accounting principles for enterprise, interpretation to the accounting principles for enterprise and other related requirements
(hereinafter referred to as Enterprise Accounting Principles) issued by the ministry of finance, on that basis, combining the
Information Disclosure Preparation Rules for Company Public Issuing Securities No.15-General Rules for Financial Report
(amended in 2014) of the CSRC for statement preparation.
2. Going concern
We evaluated the sustainable management ability for 12 months since end of the period, and found out that there was a significant
doubt on sustainable management ability of the Runhua RW, listed in Note XII, while no impact on other entity in consolidation
scope. Therefore, the financial statement is prepared based on the continuing operation assumption
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V. Major accounting policy and accounting estimation
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
Notice of specific accounting policy and estimation:
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company meet the requirements of the Accounting Standards for Business Enterprises;
truthfully and completely reflect the financial status, operation results and cash flow etc. of the Company.
2. Fiscal period
The fiscal year of the Company is from 1 January to 31 December on basis of Gregorian calendar.
3. Operating cycle
One operating cycle for the Company is from 1 January to 31 December in Gregorian calendar
4. Standard currency
The Company and its subsidiaries take RMB as the standard currency for bookkeeping.
5. Accounting treatment for business combinations under the same control and those not under the same
control
1. If the terms, conditions, and economic impact of each transaction involved in business combination achieved in stages fall
within one or more of the following situations, such transactions will be accounted for as a package deal:
(1) Such transactions are entered into simultaneously or in the case of considering the impact of each other;
(2) Such transactions as a whole in order to reach a complete business results;
(3) The occurrence of a transaction subject to that of at least one other transaction;
(4) One transaction alone is not economic, but otherwise when considered with other transactions.
2. Business combination under the same control
The Company’s assets and liabilities acquired in a business combination are measured by the book value in the consolidated financial
statements of ultimate controlling party in accordance with the assets and liabilities (including the goodwill formed by the ultimate
controlling party’s acquisition to the combined party) of combined party on combining date. If there is balance between the book
value of net assets obtained in merger and the book value of paid merger consideration (or total face value of issued shares), adjust
the stock premium in capital reserve, and adjust the retained earnings if the stock premium in capital reserve is not enough for writing
down.
If there is a contingent consideration needs to confirm the expected liabilities or assets, and there is balance between the expected
liabilities or assets amount and the settlement amount of follow-up contingent consideration, adjust the capital reserve (capital
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premium or stock premium), and adjust the retained earnings if the capital reserve is not enough.
As for business combination realized through numbers of transactions, and if these transactions belong to a bundle of transactions,
then each of them shall be accounted as a transaction to acquire controlling right; and if not belong to a bundle of transactions, then
the difference between the initial investment cost of the long term equity investment as of the date on which the Company obtains
controlling right and the carrying value of the long term equity investment prior to combination plus the carrying value of the new
consideration paid for further acquisition of shares as of the combination date shall be used to adjust capital reserve; in case of
insufficient capital reserve, adjust retained earnings. For equity investment held prior to the combination date, the other
comprehensive income recognized due to calculation by equity method or based on recognition and measurement principles for
financial instruments would not be accounted for temporarily until the Company disposes of this investment on the same basis as the
invested enterprise directly disposes of relevant assets or liabilities; other changes of owners’ equity in the net assets of invested
enterprise as recognized under equity method, except for net profit or loss, other comprehensive income and profit distribution, shall
not be accounted for until being transferred to current profit or loss when this investment is disposed of.
3. Business combination not under the same control
An acquisition date represents the date when the Company obtains the actual control of the acquiree, which means the date when the
net assets or the right of control in relation to production or operation decisions of the acquiree transfer to the Company. In general,
the Company will be deemed to materialize transfer of right of control upon satisfaction of the following conditions:
①the contracts or agreements relating to business combination has been approved by the internal authority of the Company.
②consent from the national competent authorities relating to business combination, if required, has been obtained.
③necessary property transfer procedure has been completed.
④the Company has paid a majority of the consolidated consideration, and it is capable of and scheduled to pay the outstanding
balance.
⑤the Company has actually controlled the financing and operating policies of the acquiree, and is entitled to share relevant benefits
and assume relevant risks.
The assets paid and liabilities occurred or assumed by the Company on the acquisition data as the consideration of the business
combination shall be measured at fair value, and the difference between the fair value and its carrying value shall be included in
profit or loss for the period.
The Company confirms the balance that the combined cost is greater than the fair value shares of acquiree’s recognizable net assets
obtained in the combination as the goodwill; the balance that the combined cost is less than the fair value shares of acquiree’s net
identifiable assets obtained in the combination is included in the currentprofit and loss after re-checking.
As for the business combination not under the same control realized through several exchange transactions step by step, part of the
package deal, than carrying accounting treatment on transactions with controlling rights obtained through vary transactions; for
equity investment held prior to combination date which is calculated under equity method, the sum between carrying value of the
equity investment prior to acquisition date and cost of additional investment made on the acquisition date is deemed to be the initial
investment cost of this investment. Other comprehensive income recognized for equity investment held prior to combination date
under equity method shall be accounted for when the Company disposes of this investment on the same basis as the invested
enterprise directly disposes of relevant assets or liabilities. In case that equity investment held prior to combination date is calculated
based on recognition and measurement principles for financial instruments, then the fair value of this equity investment as of
combination date plus new investment cost shall be deemed as initial investment cost. The difference between fair value and carrying
value of the originally held equity interests and the accumulated fair value movements as originally recorded in other comprehensive
income shall be all transferred to investment income of the period in which the combination date falls.
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4. Relevant expenses from combination
The intermediate expenses occurred for business combination such as audit, legal service and appraisal consultation expenses and
other related expenses shall be recorded in current gains and losses when occurred; the trading expenses for equity securities offering
shall be excluded while reckoned into equity transaction directly.
6. Methods for preparation of consolidated financial statements
1. Consolidated scope
The consolidation scope of the consolidated financial statements of the Company is fixed on the basis of control, and all subsidiaries
(including the independent subject control by the Company) have been consolidated.
2. Consolidated procedure
Based on financial statements of its own and the subsidiaries, the Company establishes the consolidated financial statements
according to other relevant data. The consolidated financial statements established by the Company regard the whole enterprise group
as an accounting subject, and reflect the overall financial situation, operating results and cash flow of the enterprise group by the
uniform accounting policies in accordance with the relevant confirmation, measurement and presentation requirements of accounting
standards.
The accounting policies and accounting period adopted by the subsidiaries taken into account of the consolidation scope are in line
with the Company. If it is not the same as the Company, necessary adjustments will be made when preparing consolidated financial
statements according to the accounting policy and accounting period of the Company.
When consolidating financial statements, the Company shall offset all effects upon consolidated balance sheet, consolidated profit
statement, consolidated cash flow statement and consolidated statement of changes in equity arising from the internal transactions
between the Company and each subsidiary and between various subsidiaries. If there is difference between the point of view of
consolidated financial statements ofenterprise group and the affirmation to the same transaction by taking the Company or its
subsidiaries as the accounting subject, adjust the transaction from the enterprise group’s point of view.
The ownership interests of subsidiaries, current net profits or losses and shares of current comprehensive income belonging to
minority shareholders are respectively and separately listed under the ownership interest item of consolidated balance sheet, the net
profit item of consolidated profit statement and the total comprehensive income item. The balance that the current losses shared by
the subsidiary's minority shareholders is greater than the shares in the ownership interests held by the minority shareholders in the
beginning period of this subsidiary offsets against the minority stockholders' interests.
For the subsidiaries acquired through business combination under the same control, take the fair value of its assets and liabilities
(including the goodwill formed by the ultimate controlling party’s acquisition to the combined party) in the financial statements of
ultimate controlling party as a basis to adjust its financial statements.
For the subsidiaries acquired through business combination not under the same control, take the fair value of net identifiable assets
on acquisition date to adjust its financial statements.
(1) Increase subsidiaries or businesses
During the reporting period, if there are subsidiaries or businesses increased by the business combination under the same control,
adjust the opening balance of consolidated balance sheet; include the income, expenses and profits of the subsidiaries or business
combination from the beginning of the period to the end of the reporting period into the consolidated profit statement; include the
cash flow of the subsidiaries or business combination from the beginning of the period to the end of the reporting period into the
consolidated statement of cash flows, adjust the relevant items of comparative statements at the same time, and regard that the
reporting entity after combination has been exiting since the ultimate controller starts controlling.
If the control can be implemented to the invested enterprises under the same control due to the additional investment, it can be
regarded that all partied in the combination can be adjusted when the ultimate controller starts controlling, i.e. by the current status
and existence. For the equity investment held before obtaining thecontrol power of combined party, the relevant profit and loss, other
comprehensive income and other changes in net assets from the later date between the acquisition date of original stock right and the
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date when the combining party and combined party are under the same control to the combination date respectively offset against the
retained earnings at the beginning of the period or the current profit and loss in the comparative statement period.
During the reporting period, if there are subsidiaries or businesses increased by the business combination not under the same control,
don’t adjust the opening balance of consolidated balance sheet; include the income, expenses and profits of the subsidiaries or
business combination from the purchase date to the end of the reporting period into the consolidated profit statement; include the
cash flow of the subsidiaries or business combination from the purchase date to the end of the reporting period into the consolidated
statement of cash flows.
If the control can be implemented to the invested enterprises not under the same control due to the additional investment, the
Company re-measures the stock right of acquiree held before the purchase date according to the fair value of this stock right on the
purchase date, the balance between fair value and its book value is included in the current investment income. Other comprehensive
income that the stock right of acquiree held before the purchase date involving in equity methodbusiness accounting and
otherchanges in ownership interest except for net profit or loss, other comprehensive income andprofits distribution, together with its
relevant other comprehensive income and other changes in ownership interest are transferred into the current investment income
attributable to the purchase date, besides the other comprehensive income generated by the changes in thenet indebtedness and net
assets re-measured and defined benefit plans by invested enterprises.
(2) Disposal of subsidiaries or businesses
1) General approaches
During the reporting period, if the Company disposes a subsidiary or business, the income, expense and profit of this subsidiary or
business from the beginning of the period to the disposal date are included in the consolidated income statement; the cash flow of this
subsidiary or business from the beginning of the period to the disposal date are included in theconsolidated statement of cash flows.
When control power over invested enterprises are lost due to disposal of some equity investment or other reasons, the Company
re-measure the remaining equity investment after disposal in accordance with its fair value on the date to lose the control power. The
balance by subtracting the sum of consideration obtained by disposing stock right and fair value of residual equity from the sum of
the shares of net assets continuously calculated according to the original shareholding ratio since the purchase date or combination
date of the original subsidiary and the goodwill are included in the investment income of the current period of losing control power.
Other comprehensive income related to the equity investment of original subsidiary and other changes in ownership interest except
for other net profit and loss, other comprehensive income and profits distribution are transferred into current investment income
when losing the control power, besides the other comprehensive income generated by the changes in thenet indebtedness and net
assets re-measured and defined benefit plans by invested enterprises.
2) Dispose subsidiaries step by step
Dispose a subsidiary'sequity investment until losing the control power step by step through multiple transactions, if the terms,
conditions and economic impact of the disposal to various transactions of the subsidiary's equity investment conform to following
one or various conditions, it means that the multiple transactions should have accounting treatment as a package deal:
A. These transactions are made by considering each other’s impacts;
B. These transactions can only reach a complete business result as a whole;
C. The occurrence of one transaction depends on the occurrence of at least one other transaction;
D. One transaction alone is not economical, but it is economical when it is considered together with other transactions.
The various transactions that dispose a subsidiary'sequity investment until losing the control power belong to a package deal, the
Company handles accounting treatment to various transactions by taking them as a transaction disposing a subsidiary'sequity
investment and losing the control power; however, the balance between every disposal price before losing control power and net
asset shares of the subsidiary corresponding to disposal of investment should be confirmed as other comprehensive income in the
consolidated financial statements and transferred into the profit and loss of the current period of losing control power when losing the
control power.
The various transactions that dispose a subsidiary'sequity investment until losing the control power and don’t belong to a package
deal, before losing control power, are handled with accounting treatment according to relevant policies which used to partly dispose
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the subsidiary'sequity investment on the condition of not losing the control power; when losing the control power, they are handled
with accounting treatment according to the general handling methods used to dispose the subsidiary.
(3) Purchase the minority shareholding of a subsidiary
If there is balance between the Company’s long-term equity investment newly obtained by purchasing the minority shareholding and
the net asset shares of the subsidiary continuously calculated from the acquisition date (or combination date) according to thenewly
increasedshareholding ratio, adjust the capital stock premium in capital reserve onconsolidated balance sheet, if the capital stock
premium in capital reserve is not enough for offset, adjust the retained earnings.
(4) The partial disposal of equity investments in subsidiaries without losing the control power
If there is balance between the disposal price obtained by the partial disposal of long-term equity investments in subsidiaries without
losing the control power and the net asset shares of the subsidiary continuously calculated from the acquisition date or combination
datecorresponding to the disposal of long-term equity investments, adjust the capital stock premium in capital reserve onconsolidated
balance sheet, if the capital stock premium in capital reserve is not enough for offset, adjust the retained earnings.
7. Classification of joint arrangement and accounting for joint operations
1. Classification of joint arrangement
The Company classifies joint venture arrangement into joint operations and joint ventures based on the structure, legal form, agreed
terms of the arrangement and other related facts and conditions.
Joint venture arrangement not concluded through separate entity is classified as joint operation; and those concluded through separate
entity are generally classified as joint ventures. However, joint venture arrangement which meets any of the following conditions as
proven by obvious evidence and satisfies relevant laws and rules is grouped as joint operation:
1. The legal form of the arrangement shows that parties to the arrangement are entitled to and assume rights and obligations in
respect of the relevant assets and liabilities.
2. It is agreed by the terms of the arrangement that parties to the arrangement are entitled to and assume rights and obligations in
respect of the relevant assets and liabilities.
3. Other related facts and conditions show that parties to the arrangement are entitled to and assume rights and obligations in respect
of the relevant assets and liabilities. For instance, joint parties are entitled to almost all the output related to joint venture
arrangement and settlement of the liabilities under the arrangement continues to rely on supports from the joint parties.
2. Accounting for joint operations
The Company recognizes its proportion of interests in joint operation as related to the Company, and accounts for under relevant
business accounting principles:
1. To recognize separately-assumed liabilities and jointly-assumed liabilities under its proportion;
2. To recognize revenue from disposal of the output which the Company is entitled to under the proportion;
3. To recognize separately-held assets and jointly-held assets under its proportion;
4. To recognize revenue from disposal of the output under the proportion;
5. To recognize separately occurred expenses, and to recognize expenses occurred for joint operations under its proportion.
For injection to or disposal of assets of joint operations (other than those assets constituting business operation), gain or loss arising
from the transaction is only recognized to the extent it is attributable to other parties to the joint operation before the joint operation is
sold to any third party. In case those assets injected or disposed satisfy the condition for asset impairment loss under Business
Accounting Principle No.8-Assets Impairment, the Company recognizes this loss in full.
For acquisition of assets from joint operations (other than those assets constituting business operation), gain or loss arising from the
transaction is only recognized to the extent it is attributable to other parties to the joint operation before the relevant assets are sold to
any third party. In case that the acquired assets satisfy the condition for asset impairment loss under Business Accounting Principle
No.8-Assets Impairment, the Company recognizes relevant loss according to the proportion it assumes.
The Company exercises no common control over joint operations. If the Company is entitled to relevant assets of the joint operation
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and assure relevant liabilities, it shall be accounted for under the above principle, otherwise it would be accounted for under the
relevant business accounting principles.
8. Recognition standards for cash and cash equivalents
When preparing cash flow statement, the Company recognized the stock cash and deposits available for payment at any time as cash,
and investments featuring with the following four characters at the same time as cash equivalents: short term (expire within 3 months
commencing from purchase day), active liquidity, easy to convert to already-known cash, and small value change risks.
9. Foreign currency business and conversion of foreign currency statement
1. Foreign currency business
For the foreign currency business, the Company converts the foreign currency into RMB for book-keeping based on spot exchange
rate at date of trading occurred while initially recognized.
On balance sheet date, balance of foreign currency monetary items shall be converted based on the spot rate as at the balance sheet
date, and the arising exchange difference shall be recorded in current gains and losses other than those arising from the special
foreign currency borrowings related to purchasing assets qualifying for capitalization which is treated under the principle of
borrowing expense capitalization. As for the foreign currency non-monetary items measured in historical cost, conversion is still
conducted with the spot rate as at the transaction date, without any change to its functional currency.
As for the foreign currency non-monetary items measured in fair value, conversion is conducted with the spot rate as at the date for
determination of fair value, and the arising exchange difference shall be recorded in current gains and losses as the changes of fair
value. if the foreign currency non-monetary items belong to foreign currency available for sale, the arising exchange difference shall
be recorded in other comprehensive income.
2. Translation of foreign currency financial statement
Assets and liabilities in balance sheet are translated at the spot exchange rate at the balance sheet date. Equity items, excluding
―undistributed profit‖, are translated at the spot exchange rates at the transaction dates. As for those translated at the spot exchange
rates at the transaction dates or those recognized in line with the reasonable method in system, translated at the similar exchange rate
as at the transaction date. The resulting translation differences are recognized in other comprehensive income.
When disposing overseas operations, the foreign currency financial statement translation differences listed under items of other
comprehensive income in balance sheet and which are directly related to the overseas operations are transferred to profit or loss in
the period when the overseas operation is disposed; In case of partial disposal or the overseas business, which has lower operation
ratio overseas without operation controlling loss due to other reason, the translation differences related to disposal part shall
including in equity of minority shareholders, no need to transfer into current gains/losses. In case of partial disposal of associated or
joint venture, foreign currency translation differences shall be calculated in respect of the disposed part under disposal proportion and
transferred to profit or loss in the period when the overseas operation is disposed.
10. Financial instruments
Financial instruments include financial assets, financial liabilities and equities instruments.
1. Categories of financial instruments
According to the contract terms of the financial instrument issued and economic substance reflects by such instrument, not only in
form of law, combine with purposes held for financial assets and liabilities, the management categorizes financial assets and liability
into different types at the time of initial confirmation: financial assets (or financial liabilities) at fair value through current gains and
losses; accounts receivable; financial assets available for sale; other financial liabilities, etc.
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2. Recognition and measurement for financial instrument
(1) Financial assets or liabilities at fair value through profit or loss
Financial assets or liabilities at fair value through profit or loss include transaction financial assets or financial liabilities and financial
assets or liabilities directly designated at fair value through profit or loss.
Transaction financial assets or financial liabilities refer to those meeting any of the following conditions:
1) Purpose for holding the assets or liabilities are to disposal, repurchase or redemption in a short time;
2) Constitute part of the identifiable financial instrument group for central management, and there is objective evidence proving that
the Company manages this group in a short-time-return way recently;
3) Belong to derivative financial instrument, other than those derivatives designated as effective hedge instruments, belonging to
financial guarantee contracts and those linked to equity instrument investment which is not quoted in an active market and whose
fair cannot be measured reliably and the settlement of which is conditional upon delivery of the equity instrument.
Subject to satisfaction of any of the following conditions, financial assets or liabilities can be designated as financial assets or
liabilities at fair value through profit or loss upon initial measurement:
1) The designation can eliminate or substantially eliminate the inconsistencies between profit or loss from the financial assets arising
from different measurement basis;
2) The portfolio of financial assets and liabilities in which the financial asset belongs to are designated as measured at fair value in
the risk management report or investment strategic report handed in to key management personnel;
3) Hybrid instruments which contains one or more embedded derivatives, unless the containing of embedded derivatives does not
have substantial effect on the cash flows of the hybrid instruments, or the embedded derivatives obviously should not be separated
from relevant hybrid instruments;
4) Hybrid instruments which contains embedded derivatives that should split, but cannot be measured separately when acquired or on
the subsequent balance sheet date.
Amount is initially measured by the sum of fair value (deducted bond interest expired without received) while obtained and relevant
transaction expenses.
Interest or cash dividend in period of holding shall be recognized as investment income, and reckoned into current gains/losses with
the variation of fair value at period-end.
In case of disposal, the difference between the amount while obtained and book value of the investment shall reckon into investment
income, and gains/loses of variation of the fair value shall be adjusted correspondingly.
(2) Account receivables
Account receivables refers to the non-derivative financial assets in active market, which has no quoted but has fixed amount or
amount can be determined in collection.
The contract price charged to the buyers shall be recognized as initial value for those account receivables which mainly comprise the
receivable creditor’s right caused by the sale of goods and providing of labor service to external customers by the Company, and
receivables in other companies excluding debt instruments priced in active markets, includes but not limited to trade receivables,
notes receivables, account paid in advance and other receivables. If characterized as of financing nature, the initial recognition shall
be priced at the present value.
Upon disposal, the difference between the sale value and the book value of the receivables shall be accounted into current profit or
loss on its recovery or disposal.
(3) Held-to-maturity investment
The non-derivative financial assets with maturity date, fix return amount or amount able to determined, and the Company held with
specific intention and ability.
The Company takes the sum of fair value (after deducting bond interests which is due for interest payment but not received) and
related transaction fee as initial recognition amount in respect of held-to-maturity investment upon acquisition of the investment.
During the holding period, the Company recognizes interest income at amortized cost and effective interest rate which is included in
investment income. The effective interest rate is determined upon acquisition of the investment and remains unchanged for the
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expected continuous period or appropriate shorter period. Difference between sale price and carrying value of the investment is
included in investment income.
If held-to-maturity investment is disposed or reclassified as other types of financial asset, and the relevant amount is relatively bigger
than the total amount of our all held-to-maturity investments prior to disposal or reclassification, the remaining held-to-maturity
investments shall be reclassified as available-for-sale financial assets immediately following such disposal or reclassification. On the
reclassification date, difference between the carrying value and fair value of the investment is included in other comprehensive
income and is transferred out into current profit or loss when the available-for-sale financial assets experience impairment or
derecognition. However, the followings are exceptions:
1) The date of disposal or reclassification is approaching to the date of expiration or redemption of the investment (such as three
months prior to expiration), and change of market rate has no material influences over the fair value of the investment.
2) Company has already recovered nearly all initial principal under the repayment means as agreed in contract.
3) Disposal or reclassification is arising from separate matters which are out of our control, which are expected not to occur
repeatedly and which are difficult to predict reasonably.
(4) Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are designated as available-for-sale upon initial recognition
and financial assets other than other categories of financial assets.
The Company initially measures available-for-sale financial assets at the sum between their fair values when acquiring the assets or
liabilities (after deducting cash dividend already declared but not paid or bond interests which is due for interest payment but not
received) and the relevant transaction fee.
Interest or cash dividend acquired during the holding period shall be recognized as investment income. Gains or losses arising from
movement of fair value is directly included in other comprehensive income except for impairment loss and exchange difference
arising from foreign currency monetary financial assets.
When disposing available-for-sale financial assets, the Company includes the difference between the acquired price and carrying
value of the financial assets into investment profit or loss. Meanwhile, accumulated fair value movement attributable to the disposed
part which is originally directly included in other comprehensive income is transferred out and included investment profit or loss.
For equity instrument investment which is not quoted in an active market and whose fair value cannot be reliably measured, and
derivative financial assets which are linked to the equity instrument and whose settlement is conditional upon delivery of the equity
instrument, they are stated at cost by the Company.
(5) Other financial liabilities
Initial recognition amount is determined at the sum of fair value and relevant transaction fee. Subsequent measurement is conducted
at amortized cost.
(6) Held-to-maturity investment for sales or reclassify as financial assets available for sale:
In case that the amount of held-to-maturity investments disposed or reclassified into other categories of financial assets is greater
than the total amount of all the held-to-maturity investment of the Company before the disposal or reclassification, the remaining
held-to-maturity investment shall be recorded as financial assets available for sale immediately after such disposal or reclassification,
unless:
1) The date of disposal or reclassification is relatively close to the maturity date or redemption date of the investment (such as three
months before expiration), and change of market rate has no material affects on the fair value of the investment.
2) The enterprise has nearly recovers the entire initial principal under the payment method as agreed by contract.
3) The disposal or reclassification is due to such independent matter that the enterprise is not able to control, will not happen again as
expected and can not predicted reasonably.
3. Confirmation evidence and measurement methods for transfer of financial assets
When transfer of financial assets occurs, the Company shall stop recognition of such financial assets if all risks and remunerations
related to ownership of such financial assets have almost been transferred to the receiver; while shall continue to recognize such
financial assets if all risks and remunerations related to ownership of such financial assets have almost been retained.
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When judging whether or not the aforesaid terminal recognition condition for financial assets is arrived at for transfer of financial
assets, the Company generally adopts the principle that substance overweighs format. The Company divides such transfer into entire
transfer and part transfer. As for the entire transfer meeting condition for discontinued recognition, balance between the following
two items is recorded in current gains and losses:
(1) Carrying value of financial assets in transfer;
(2) Aggregate of the consideration received from transfer and accumulative movements of fair value originally recorded in owners’
equity directly (applicable when financial assets involved in transfer belong to financial assets available for sale).
As for the part transfer meeting condition for discontinued recognition, entire carrying value of financial assets in transfer is shared
by discontinued recognition part and continued recognition part, in light of their respective fair value. Balance between the following
two items is recorded in current gains and losses:
(1) Carrying value of discontinued recognition part;
(2) Aggregate of the consideration of discontinued recognition part and amount of such part attributable to accumulative movements
of fair value originally recorded in owners’ equity directly (applicable when financial assets involved in transfer belong to financial
assets available for sale).
Financial assets are still subject to recognition if transfer of such assets doesn’t satisfy the condition for discontinued recognition.
And consideration received is recognized as financial liability.
4. De-recognition condition for financial liability
As for the financial liabilities with its whole or part present obligations released, the company shall de-realize such financial
liabilities or part of it. if the company enters into agreement with its creditor to substitute for the existing financial liabilities by
means of assuming new financial liabilities, then the company shall de-realize the existing financial liabilities and realize the new
financial liabilities provided that the contract clauses of the new and the existing financial liabilities are different in substance.
If the company makes substantial amendment to the whole or part contract clauses of the existing financial liabilities, it shall
de-realize the existing financial liabilities or part of it. Meanwhile, the financial liabilities with amendment to its clauses shall be
realized as new financial liabilities.
In case of derecognizing of financial liabilities in whole or part, the difference between the carrying value of such de-realized
financial liabilities and consideration paid (including the non-cash assets exchanged or new financial liabilities assumed) shall be
recorded in current gains and losses.
In case that the company repurchases part of financial liabilities, based on the comparative fair value of the continuing recognition
part and the derecognizing part, the company shall allocate the carrying value of the financial liabilities in whole on the repurchase
date. Difference between the carrying value allocated to the derecognizing part and the consideration paid (including the non-cash
assets exchanged or new financial liabilities assumed) shall be recorded in current gains and losses.
5. Determination method for fair value of financial assets and financial liabilities
As for the financial assets or financial liability for which there is an active market, the quoted prices in the active market shall be
used to determine the fair value thereof; the quoted prices in the active market refers to the prices, which are easily available from the
stock exchanges, brokers, industry associations, pricing service institutions and etc. at a fixed term, and which represent the prices at
which actually occurred market transactions are made under fair conditions.
As for the financial assets and financial liabilities measured by fair value and in case that there are active market for those assets and
liabilities, then the fair value shall be determined based on the quotation on active market; as for the financial assets initially acquired
or financial liabilities assumed, their fair value are determined based on the market transaction prices; in case that there are no such
active market for financial assets and financial liabilities, the fair value shall be determined by evaluation technology. At time of
evaluation, the applicable evaluation technology, in the prevailing circumstance, and those have available date and other information
supporting shall be adopted, choose the input value, same with the assets or liability features that consider in transaction by market
participants, and use the relevant observable input values as far as possible. Use the un-observable input values when relevant
observable input values unable to obtained or obtained without feasible.
6. Provision of impairment reserve for impairment of financial assets (excluding account receivables)
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The company reviews the carrying value of the financial assets (excluding those measured by fair value and the change thereof is
recorded in current gains and losses) on the balance sheet date, if there is objective evidence showing impairment of the financial
assets, it shall provide impairment reserve.
Objective evidence that a financial asset is impaired includes the following observable events:
1.Significant financial difficulty of the issuer or debtor;
2.A breach of contract by the borrower, such as a default or delinquency in interest or principal payments;
3.The creditor, for economic or legal reasons relating to the borrower’s financial difficulty, granting a concession to the borrower;
4.It becoming probable that the borrower will enter bankruptcy or other financial reorganizations;
5.The disappearance of an active market for that financial asset because of financial difficulties of the issuer;
6.Observable data indicating that there is a measurable decrease in the estimated future cash flows from a group of financial assets
since the initial recognition of those assets, although the decrease cannot yet be identified with the individual financial assets in the
group, including: adverse changes in the payment status of borrowers in the group, an increase in the unemployment rate in the
country or geographical area of the borrowers, a decrease in property prices for mortgages in the relevant area, or adverse changes in
industry conditions that affect the borrowers in the group;
7.Significant adverse changes in the technological, market, economic or legal environment in which the issuer operates, indicating
that the cost of the investment in the equity instrument may not be recovered by the investor;
8.A significant or prolonged decline in the fair value of an investment in an equity instrument below its cost;
Details for impairment of financial assets are set out below:
(1) Impairment provision for available-for-sale financial assets
The Group has separately tested various available-for-sale equity instruments at the balance sheet date. It will be defined as
impairment if the fair value is lower than the initial investment cost by more than 50% (including 50%) or the low state has lasted for
no less than 1 year. While the lower proportion is between 20% and 50%, the Group will take other factors such as price fluctuation
into consideration to estimate whether the equity instrument has impaired or not.
Cost stated in the above paragraph is determined based on the initial acquisition cost of available for sale equity instrument
investment less recovered principal and amortized amount as well as impairment loss originally included in profit or loss; fair value
is determined at the closing price quoted on stock exchange at period end, unless the available for sale equity instrument investment
is limited for sale for certain periods. For available for sale equity instrument investment which is limited for sale for certain periods,
fair value is determined at the closing price quoted on stock exchange at period end less the compensation required by market
participator who would otherwise assume risks due to impossibility of selling the equity instrument on open market in designated
period.
When an available-for-sale financial asset is impaired, the cumulative loss arising from decline in fair value that had been recognized
in other comprehensive income is reclassified to the profit or loss even though the financial asset has not been derecognized. The
amount of the cumulative loss that is removed from equity is the difference between the acquisition cost (net of any principal
repayment and amortization) and current fair value, less any impairment loss on that financial asset previously recognized in profit or
loss.
If there are objective evidences showing that the value of available-for-sale debt instrument is recovered and it relates to the matters
happened after the impairment loss recognition, the impairment loss recognized shall be reversed and accounted in current profit or
loss. Impairment losses recognized for equity instrument investments classified as available-for-sale are reversed through equity.
However, impairment loss occurred by equity instrument investment which is not quoted in an active market and whose fair value
cannot be measured reliably and derivative financial assets which are linked to the equity instrument and whose settlement is
conditional upon delivery of the equity instrument, shall not be reversed.
(2) Impairment provision for held-to-maturity investment
For held-to-maturity investment, if there is object evidence showing the investment is impaired, then impairment loss is determined
based on the difference between its fair value and present value of predicted future cash flow. After provision, if there is evidence
showing its value has been restored, the originally recognized impairment loss can be reversed and included in current profit or loss,
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provided that the reversed carrying value shall not exceed the amortized cost of the financial asset as at reversal date assuming no
impairment provision had been made.
7. Offset of financial assets and financial liabilities
Financial assets and financial liabilities are stated in balance sheet separately without inner-offset. However, the net amount after
inner offset is stated in balance sheet date when the following conditions are all met:
(1) The Company has legal right to offset recognized amount and the right is enforceable;
(2) The Company plans to settle on a net basis, or simultaneously realize the financial assets and settle the financial liabilities.
11. Note receivable and account receivable
(1) Account receivable with single significant amount and withdrawal single item bad debt provision
Determine basis or amount standards for single significant
Account with single significant amount not less than RMB one million
amount
Conducted impairment testing separately, balance between the
present value of future cash flow and its carrying value, bad debt
Withdrawal method for bad debt provision of account receivable
provision withdrawal and reckoned into current gains/losses.As
with single significant amount:
for the receivable without impairment being out in test, accrual
bad debt provision in corresponding group
(2) Accounts receivable whose bad debts provision was accrued by combination of credit risk
characteristics portfolio
Portfolio Methods on withdrawal of bad debt provision
Aging analysis Age analysis method
Related parties within the consolidation scope Other method
Risk-less Other method
Accrued for provision of bad debt by aging analysis method in portfolio:
√Applicable □ Not-applicable
Account age Accrual ratio for account receivable Accrual ratio for other account receivable
Within one year (one year included) 5.00% 5.00%
1－2 years 20.00% 20.00%
2－3 years 50.00% 50.00%
Over 3 years 100.00% 100.00%
Accrued for provision of bad debt by balance proportion method in portfolio:
□Applicable √ Not-applicable
Accrued for provision of bad debt by other method in portfolio:
√Applicable □ Not-applicable
Combination Accrual ratio for account receivable Accrual ratio for other account receivable
Related parties within the consolidation 0.00% 0.00%
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scope
Risk-less 0.00% 0.00%
(3) Accounts receivable with single significant amount and bad debts provision accrued individually
There is an objective evidence of impairment which is probably
about to occurred, such as revocation from the debtor,
Reasons for withdrawal single item bad debt provision bankruptcy or dead, and still able to recover after liquidated by
the bankruptcy property or heritage as well as serious insufficient
cash flow etc.
For those account receivable with objective evidence of
impairment been found, separated them from the relevant groups
for impairment testing independently, and impairment losses
Withdrawal method for bad debt provision
shall recognized and withdrawal bad debt reserves on the
difference between the present values of estimated future cash
flow which is lower than its carrying value,
12. Inventory
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
1. Classification of inventories
Inventories are categorized into development cost, development products, relocation housing animals & plants aquaculture plant
products, finished goods of polyethylene and low value consumables etc.
2. Valuing of inventory
The Company adopts the historical cost for obtaining or the planned cost to value the inventory according to its actual situation, and
specific identification method for the development projects.
Specific valuation method for consumptive biological assets found more in the biological assets listed in Note IV(18)
3. Confirmation of net realizable value for the inventory and provision for inventory impairment
The ending inventory is measured at the lower of cost and net realizable value. Provision for impairment of inventory is determined
at the excess amount of the single cost of the inventory over its net realizable value. Net realizable value is determined based on the
estimated selling price in the ordinary course of business, less the estimated costs to completion and estimated costs necessary to
make the sale and related taxes.
In case the influencing factor for write-down of the inventory values has disappeared, the amount which has been written down can
be recover, and shall switch back within the inventory falling price reserves which has been accrual originally, the amount switch
back shall reckoned into current gains/losses.
4. Inventory System
Perpetual inventory system
5. Amortization method for low-value consumables and wrappage
(1) Low-value consumables are amortized on one-off amortization method
6. Relocation housing refers to the house for turnover purpose to arrange for relocation of residents, and amortized evenly in
50 years.
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7. Calculation method of the lands for development purpose
As for the pure land development project, the costs constitute costs of the land development; the project develops along with the real
estate, costs with clear burden of objects shall split into commercial house costs with actual area.
8. Calculation method of the expenses of public supporting facilities
Public supporting facilities cannot be transfer with compensation: reckoned into commercial house costs by the benefit ratio;
Public supporting facilities can transfer with compensation: take all supporting facilities as the cost calculation subject, summarize
the costs occurred.
9.Accounting for maintenance funds
According to the relevant provisions at the location of the developed projects, the maintenance funds should be collected from the
house buyer or withdrawn and stated by the Company as development costs of relevant developed projects at the time of sale (presale)
of the developed projects and uniformly turned in to the maintenance fund management department.
10.Accounting for quality assurance funds
The quality assurance funds should be deducted from the project payment for the construction unit according to the construction
contracts. Maintenance expense incurred in the warranty period of the developed projects should be written down by the quality
assurance funds. The balance of the quality assurance funds should be returned to the construction unit upon expiry of the specified
warranty period of the developed projects.
13. Assets held for sale
1. Recognition criteria of assets held for sale
The non-current asset will recognize as held-for-sale while satisfied the followed conditions simultaneously:
(1)immediate sale is available under the existing status based on the conventional practice for sale of such kind of assets or disposal
group in similar transaction;
(2)The sale is likely to occur, that is, the Company has made resolution on the selling plan and obtained approval from regulatory
department (if applicable) and obtained definite purchase commitment, the selling is estimated to be completed within one year.
Definite purchase commitment means a binding purchase agreement entered into by the Company and other parties, which contains
transaction price, time and adequately strict punishments for breach of contract provisions, which renders the possibility of material
adjustment or revocation of the agreement is extremely minor.
2. Accounting for assets held for sale
The Company makes no provision for depreciation or amortization for non-current assets or disposal group held for sale. For
non-current asset or disposal group held for sale, for which it is found that the carrying value is higher than its fair value less disposal
expense, the carrying value shall be deducted to the net amount of fair value less disposal expense, and the reduced amount shall be
recognized as impairment loss in profit or loss for the period, and provision of impairment of assets held for sale shall be provided for
accordingly.
As for non-current asset or disposal group classified as held for sale on the acquisition data, they are measured at the lower of their
initial measurement amount and the net amount after their fair value less the selling expenses based on the assumption that such
non-current assets or disposal group are not classified as held for sale at the time of initial measurement.
The above principle applies to all the non-current assets, other than investment property subsequently measured at fair value,
biological assets measured at the net amount of fair value less selling expense, assets formed from staff remuneration, deferred
income tax assets, financial assets regulated by financial instrument related accounting standards and right arising from insurance
contract regulated by insurance contract related accounting standards.
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14. Long-term equity investment
1. Recognition of investment cost
(1) As for the long-term equity investment formed from business combination under the same control, accounting policy found in (IV)
Accounting method for business combination (not) under the same control of Note IV
(2) Long-term equity investment obtained by other means
For long-term equity investments obtained through payment with cash, then the actual payment shall be viewed as initial investment
cost. Initial investment cost including the expenses, taxes and other necessary costs that directly concerned with the long-term equity
investment that acquired.
For long-term equity investments obtained through issuance of equity securities, then the fair value of such securities shall be viewed
as initial investment cost; for transaction expenses from issuing or own equity instrument acquired, it can be deducted from the
equity when such expenses attributable directly to equity transaction.
Under the precedent condition that non-monetary assets exchanges are featured with commercial nature and fair values of
exchange-in or exchange-out assets can be reliably measured, long-term equity investment exchange-in through non-monetary assets
exchange shall be recognized with initial investment cost on the basis of the fair value of the assets exchange-out, unless there is
obvious evidence showing that fair value of exchange-in assets is more reliable; as for non-monetary assets exchanges not satisfying
such precedent condition, initial investment cost of exchange-in long-term equity investment falls to the carrying value of
exchange-out assets and relevant taxes payable.
For long-term equity investments obtained through debt reorganization, its initial investment cost is recognized based on fair value.
2. Subsequent measurement and recognition of gains and losses
(1) Cost method
The long-term equity investment control by invested entity shall counted by cost method, and pricing on initial investment cost, cost
of the long-term equity investment shall be adjusted while additional investment or dis-investment.
Other than payment actually paid for obtaining investment or cash dividend or profit included in consideration which has been
declared while not granted yet, the Company recognizes investment income according to its share in the cash dividend or profit
declared for grant by the invested unit.
(2) Equity method
The Company calculates long term equity investment in associates and joint ventures under equity method. For certain equity
investments in associates indirectly held through risk investment institutions, joint funds, trust companies or similar entities including
investment linked insurance fund, the Company measures the investment at fair value through profit or loss.
Where the initial investment cost of a long-term equityinvestment exceeds the Group’s share of the fair value of the invested
enterprise’sidentifiable net assets at the time of acquisition, no adjustment is made to theinitial investment cost. Where the initial
investment cost is less than the Group’sshare of the fair value of the invested enterprise’s identifiable net assets at the time
ofacquisition, the difference is recognized in profit or loss for the period.
Return on investments and other comprehensive income is recognized respectively by shares of net gains and losses realized by the
invested company and other comprehensive income after acquisition of long-term equity, and book value of such investment is
adjusted accordingly. Profit or cash dividends pro rata distributed by the invested company are to minus book value of the relative
long-term investment.Book value of long-term investment is adjusted when changes occur other than net gains and losses, other
comprehensive income and profit distribution of the invested company, and is to reported in owners’ equity accordingly
The Company should recognized net profit of invested unit after adjustment, based on fair value of vary identifiable assets of
invested unit while obtained investment, while recognized net profit or net losses of invested units that should be enjoy by investment
enterprise. the un-realized transaction gains/losses attributable to investment enterprise, internally occurred between the Company,
affiliated units and joint-ventures should calculated by proportion of shares-holding which should be offset, than recognized
investment gains/losses.
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When the Company is confirmed to share losses of the invested units, the following order shall prevail for disposal: first of all, offset
carrying value of long-term equity investment. Second, for long-term equity investment whose carrying value is not enough for offset,
investment loss should be continued to recognize within the limit of carrying value of other long-term equity which substantially
forms net investment to invested units, to offset carrying value of long-term items receivable. At last, after the aforesaid treatment, if
enterprise still bears additional duties according to investment contract or agreement, projected liabilities are recognized in
accordance to the obligations which are expected to undertake, and then recorded in current gains and losses.
In the event that the invested unit realizes profit in later periods, the Company will adopt disposal adverse to the above order after
deduction the unrecognized share of loss, i.e. write off the carrying value of the recognized projected liabilities, recover carrying
value of long-term equity which substantially forms net investment to invested unit and long-term equity investment, and recognize
investment income at the same time.
3. Transfer of calculation for long term equity investment
(1) Measure at fair value transfer to equity method
For the equity investment originally held by the Company in which it has no control, common control or significant influence over
the invested enterprise and which is accounted for under recognition and measurement principle as financial assets, in case that the
Company becomes able to exercise significant influence or common control upon the invested enterprise due to additional
investment while no control is reached, the sum of fair value of the originally held equity investment as determined under Accounting
Standards for Business Enterprise No.22- Recognition and Measurement of Financial Instrument plus cost of the new investment
shall be deemed as the initial investment cost upon calculation under equity method.
If the originally held equity investment is classified as available for sale financial assets, the difference between its fair value and
carrying value and the accumulated fair value movement which is originally included in other comprehensive income shall be
transferred to current period gains and losses under equity method.
In case that the initial investment cost under equity method is lesser than share of fair value of the invested enterprise’s net
identifiable assets as of the date when additional investment is made as calculated based on the latest shareholding proportion upon
additional investment, carrying value of the long term equity investment shall be adjusted against such difference which is included
in current period non-operating income.
(2) Measure at fair value or calculation under equity method transfer to calculation under cost method
For the equity investment originally held by the Company in which it has no control, common control or significant influence over
the invested enterprise and which is accounted for under recognition and measurement principle as financial instrument, or for long
term equity investment originally held in associates or joint ventures, in case that the Company becomes able to exercise control over
invested enterprise not under common control due to additional investment, the sum of fair value of the originally held equity
investment plus cost of the new investment shall be deemed as the initial investment cost upon calculation under cost method when
preparing separate financial statement.
For other comprehensive income as recognized under equity method in respect of equity investment held prior to acquisition date,
when the Company disposes this investment, the aforesaid income shall be accounted for on the same basis as the invested enterprise
would otherwise adopt when it directly disposes relevant assets or liabilities.
For equity investment held prior to acquisition date which is accounted for under Business Accounting Principles No.22- Recognition
and Measurement of Financial Assets, the accumulated fair value movement which originally included in other comprehensive
income shall be transferred to current period gains and losses upon calculation under cost method.
(3) Calculation under equity method transfer to fair value measurement
In case that the Company lost common control or significant influence upon invested enterprise due to disposal of part equity
investment, the remaining equity investment shall be calculated under Accounting Standards for Business Enterprise No.22-
Recognition and Measurement of Financial Instrument, and the difference between its fair value and carrying value as of the date
when the Company lost common control or significant influence shall be included in current period gains and losses.
For other comprehensive income as recognized under equity method in respect of the original equity investment, when the Company
ceases calculation under equity method, the aforesaid income shall be accounted for on the same basis as the invested enterprise
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would otherwise adopt when it directly disposes relevant assets or liabilities.
(4) Cost method transfer to equity method
In case that the Company lost control upon invested enterprise due to disposal of part equity investment, and if the remaining equity
investment can exercise common control or significant influence over the invested enterprise, equity method shall be adopted when
preparing separate financial statement, and the remaining equity investment shall be adjusted as if it had been stated under equity
method since the acquisition.
(5) Cost method transfer to fair value measure
In case that the Company lost control upon invested enterprise due to disposal of part equity investment, and if the remaining equity
investment cannot exercise common control or significant influence over the invested enterprise, Accounting Standards for Business
Enterprise No.22- Recognition and Measurement of Financial Instrument shall be adopted for accounting treatment when preparing
separate financial statement, and the fair value and carrying value as of the date when control is lost shall be included in current
period gains and losses.
4. Disposal of long term equity investment
Difference between carrying value and actual acquisition price in respect of disposal of long term equity investment shall be included
in current period gains and losses. For long term equity investment under equity method, the Company shall adopt the same basis as
the invested enterprise directly disposes relevant assets or liabilities when disposing this investment, and account for the part
originally included in other comprehensive income under appropriate proportion.
If the terms, conditions and economic impact of each transaction involved in the disposal by steps of investment in subsidiaries fall
into one or more of the following situations, such transactions will be accounted for as a package deal:
1. Such transactions are entered into simultaneously or in the case of considering the impact of each other;
2. Such transactions as a whole in order to reach complete commercial results;
3. The occurrence of one transaction is subject to that of at least one other transaction;
4. A transaction alone is not economic, but otherwise when considered with other transactions.
Enterprises that lose control of their original subsidiaries due to the disposal of partial equity investment or otherwise, and therefore
disqualify a package deal, should prepare the relevant accounting treatment in differentiation with individual financial statements and
consolidated financial statement:
(1) In separate financial statement, as for disposal of equity interest, difference between carrying value and actual acquisition price
shall be included in current period gains and losses. In case that the remaining equity interests can exercise common control or
significant influence over invested enterprise, it shall be stated under equity method in stead, and shall be adjusted as if the remaining
equity interests had been stated under equity method since the acquisition. In case that the remaining equity interests cannot exercise
common control or significant influence over invested enterprise, it shall be accounted for under Business Accounting Principles
No.22- Recognition and Measurement Principle of Financial Instruments, and the difference between its fair value and carrying value
as of the date then the Company lost control shall be included in current period gains and losses.
(2) In consolidated financial statement, for those transactions occurred before lost of control in subsidiaries, the difference between
disposal price and share of net assets of subsidiaries since purchase date or combination date shall be used to adjust capital reserve
(equity premium), and if capital reserve is insufficient to offset, then it shall adjust retained earnings; when the Company lost control
in a subsidiary, the remaining equity interests would be re-measured at the fair value as of the control-lost date. The sum of
consideration gained from the disposal of equity and the fair value of remaining equity minus the share of net assets of original
subsidiaries since the day of purchase and based on its original shareholding ratio is credited into investment gain for the current
period, and off-set the goodwill at the same time. Other comprehensive income in relation to equity investments of original
subsidiaries should be transferred to investment gain for the period at the time of loss of control.
Each transaction involved in the disposal of equity investments of subsidiaries until loss of control falls into a package deal, carrying
accounting treatment on transaction of losing control rights and disposing the company, and should be accounted for accordingly in
differentiation with individual financial statements and consolidated financial statements:
(1) In consolidated financial statements, difference between each payment from disposal of an equity and the book value of such
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long-term equity investment before the loss of control should be recognized as other comprehensive income and at the time of loss of
control, transferred to profit or loss for the current period.
(2) In consolidated financial statements, difference between each payment from disposal of a subsidiary and the share of its net assets
through investment before the loss of control should be recognized as other comprehensive income and at the time of loss of control,
transferred to profit or loss for the current period.
5. Criteria for common control and significant influence
Where the Company jointly controls an arrangement with other participators under agreed terms, and decisions which materially
affect return of such arrangement can only exist when other participators unanimously agree on the decisions, the Company is
deemed to jointly control this arrangement with other participators, and the arrangement belongs to joint venture arrangement.
In case of a joint venture arrangement concluded through separate entity, when the Company is judged to be entitled to the net assets
of the separate entity under relevant agreements, the entity shall be viewed as a joint venture under equity method. However, when
the Company is judged to be not entitled to the net assets of the separate entity under relevant agreements, the entity shall be viewed
as a joint operation, in which case, the Company recognizes items relating to its share of interests from the joint operation and
accounts for according to relevant business accounting rules.
Significant influence refers to that investor has right to participate in making decisions relating to the financial and operational
policies of the invested enterprise, while not able to control or jointly control (with others) establishment of these policies. The
following one or more conditions are based to judge whether the Company has significant influence over invested enterprise with
consideration of all facts and situations: (1) Has delegate in the board of directors or similar authority organs of invested enterprise;
(2) Participate in establishing financial and operational policies of the invested enterprise; (3) Occur material transactions with the
invested enterprise; (4) Delegate management to the invested enterprise; (5) Provide key technical data to the invested enterprise.
15. Investment real estate
Measurement model of investment real estate
Measure by cost
Depreciation or amortization method
Investment real estate is defined as the real estate with the purpose to earn rent or capital appreciation or both, including the rented
land use rights and the land use rights which are held and prepared for transfer after appreciation, the rented buildings. Besides, in
respect of any vacant building held by the Company ready for operation lease, if the Board passed a written resolution to expressly
indicate that the building will be used for operation lease and the intention of such hold will not change in a short run, the building
shall be presented as investment property either.
The investment property of the Company is accounted at its cost. Cost of investment property purchased from the external sources
includes purchase payment, related taxes and other expenditures which can be directly attributable to such assets; Cost of investment
property constructed by the Company comprise of the necessary expenditure occurred during the construction for reaching the
condition of planned use.
Consequent measurement of investment estate shall be measured by cost method. Depreciation and amortization are provided to the
buildings and land use right pursuant to the predicted service life and net rate of salvage value. The predicted service life and net rate
of salvage value and annual depreciation (amortization) are listed as follows:
Type Expected operating life Predicted rate of net salvage Yearly depreciation
(year) value (amortization)
Land Use Right 50 0%-10% 1.80%-2.00%
House and buildings 20-28 0%-10% 3.56%-4.50%
When investment real estate turns to be used by holders, it shall switch to fixed assets or intangible assets commencing from the date
of such turning. And when self-used real estate turns to be leased out for rental or additional capital, the fixed assets or intangible
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assets shall switch to investment real estate commencing from the date of such turning. In situation of switch, the carrying value
before the switch shall be deemed as the credit value after the switch.
Indication of impairment is assessed, the recoverable amount shall be estimated and the impairment shall be recognizing while the
recoverable amount lower than its book value.
Impairment loss once recognized shall not be reversed.
When investment is disposed, or out of utilization forever and no economic benefit would be predicted to obtain through the disposal,
the Company shall terminate recognition of such investment real estate. The amount of income from disposal, transfer, discarding as
scrap or damage of investment real estate after deducting the asset’ s carrying value and relevant taxation shall be written into current
gains and losses.
16. Fixed asset
(1) Recognition
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 year of service life. Fixed assets should be recognized for qualified the followed
conditions at the same time:
(1) It is probable that the economic benefits associated with the assets will flow into the Company; and
(2) The cost of the assets can be measured reliably.
2. Initial measurement of fixed assets
Fixed assets of the Company are initially measured at cost.
(1) The cost of purchased fixed assets includes the purchase price, import duties and other related taxes, and other expenses directly
attributable to the assets before the fixed assets are ready for their intended use.
(2) The cost of self-constructed fixed assets consists of the necessary expenses incurred before the construction of the asset reaches
its intended usable condition.
(3) The fixed assets invested by investors shall be recorded at the value agreed in the investment contract or agreement, but if the
value agreed in the contract or agreement is not fair, it will be recorded at fair value.
(4) If the purchase price of the fixed assets has a delay in payment beyond the normal credit conditions and is of financing nature, the
cost of the fixed assets shall be determined on the basis of the present value of the purchase price. The difference between the
actually paid price and the present value of the purchase price shall be included in the current profit and loss during the credit period,
except for the capitalization.
3. Subsequent measurement and disposal of fixed assets
(1) Depreciation of fixed assets
Depreciation of fixed assets is accrued based on the recorded valueminus the estimated net residual value within the expected useful
lives. For fixed assets with impairment provision, the depreciation amount will be determined based on the book value after
deducting the impairment provision in the future period and the remaining useful life.
For fixed assets formed by special reserve expenses, the special reserve is offset by the cost of forming fixed assets, and the
accumulated depreciation of the same amount is confirmed, the fixed assets are no longer depreciated in the future period; the fixed
assets that have been fully depreciated and continue to be used shall not be depreciated.
The company determines the service life and estimated net residual value of fixed assets based on the nature and use of fixed assets.
At the end of the year, the service life of the fixed assets, the estimated net residual value and the depreciation method are reviewed.
If there is a difference from the original estimate, the corresponding adjustments are made.
(2) Subsequent expenditure on fixed assets
Subsequent expenditures related to fixed assets that meet the conditions for recognition of fixed assets are included in the fixed assets
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cost; and those do not meet the conditions for recognition of fixed assets are included in current profit or loss when occurred.
(3) Disposal of fixed assets
When a fixed asset is disposed of, or cannot generate economic benefits through use or disposal, derecognize the fixed asset. The
amount of the disposal income from the sale, transfer, retirement or damage of fixed assets after taking away its book value and
related taxes and expenses is included in current profit or loss.
(2) Depreciation method
Category Depreciation method Estimated useful life Estimated residual rate Annual depreciation rate
Houses and buildings Straight-line depreciation 20.00-28.00 5.00 3.39%-4.75%
Machinery equipment Straight-line depreciation 4.00-5.00 5.00 19.00%-23.75%
Transportation
Straight-line depreciation 5.00-20.00 5.00 4.75%-19.00%
equipment
Other equipment Straight-line depreciation 3.00-5.00 5.00 19.00-31.67%
(3) Basis of asserting, pricing and depreciation method on fixed assets under financing lease
A fixed asset leased by the Company is recognized as the fixed asset held under finance lease if one or more of the following criteria
are met: (1) Upon the expiry of the lease term, the ownership is transferred to the Company. (2) The Company has the option to
purchase the leased asset at a predetermined price that is expected to be much lower than the fair value of the leased assets when the
option is exercised. Therefore, it can be reasonably determine that the company will exercise this option on the lease start date. (3)
The lease term approximates the useful life of the relevant asset even if the ownership is not transferred. (4) At the inception of the
lease, the present value of the minimum lease payments is substantially equivalent to the fair value of the leased asset. (5) The leased
assets are of such a specialized nature that only the Company can use them without major modification. A fixed asset held under
finance lease is initially recognized at the lower of fair value of the leased asset and the present value of the minimum lease payments,
while the amount of the minimum lease payments will be recognized as the entry value of long-term account payable, the difference
between them will be recognized as unrecognized financing costs. The initial direct costs such as commissions, attorney’s fees, and
travelling expenses, stamp duties attributable to the leased item incurred during the process of lease negotiating and signing the
leasing agreement shall be recorded in the asset value. Unrealized finance costs will be amortized using actual interest rate method
over each period during the lease terms. The Company adopts depreciation policies for leased assets consistent with those of
self-owned fixed assets for the purpose of calculating the depreciation of a leased asset. If it is reasonable to be certain that the lessee
will obtain the ownership of the leased asset when the lease term expires, the leased asset shall be fully depreciated over its useful life.
If it is not reasonable to be certain that the lessee will obtain the ownership of the leased asset at the expiry of the lease term, the
leased asset shall be fully depreciated over the shorter one of the lease term or its useful life.
17. Construction in process
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
1. Classification of constructions under progress
The construction in progress constructed by the Company on its own shall be measured at the actual cost which comprises of all the
necessary expenses occurred to enable the asset to meet such conditions as required for expected purpose, including engineering
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materials cost, labor cost, relevant tax payment, loan expenses which should be capitalized and indirect expenses which should be
amortized, etc.
2. Standard and point of time for construction in process carrying forward to fixed assets
Fixed asset is booked with the entire expenditures occurred in the construction in process till it arrives at predicted state for use. For
those constructions in process of fixed assets which have already arrived at the predicted state for use, while still with absence of
completion settlement, they shall be carried forward to fixed assets at the estimated value based on engineering budget, construction
cost or actual cost commencing from the date of arrival of the predicted state for use. Meanwhile, they shall be also subject to the
depreciation policies applicable to fixed assets of the Company for provision of depreciation. Once completion settlement is made,
the original temporary estimated value shall be adjusted at the effective cost. However, the original provision of depreciation remains
unchanged.
3. Impairment test and impairment provision for construction in process
The Company determines whether there is evidence of impairment that may occur upon construction in progress at end of each
period.
If there is indication of impairment of construction in progress, the Company shall estimate its recoverable amount. The recoverable
amount is to be determined by the higher between the net price of the fair value of construction in progress after subtracting costs of
disposal and the present value of expected future cash flow from construction in progress.
When the recoverable amount of construction in progress is below their book value, the book value of construction in progress shall
be written down to its recoverable amount, and the amount of write-down shall recognized as impairment loss of construction in
progress, and included into current profits and losses. At the same time, the provision for depreciation of construction in progress
shall be accrued.
After the recognition, the impairment loss of construction in progress shall not be reversed in subsequent accounting period.
If there are indications showing that impairment of certain construction in progress is possible, the Company shall estimate its
recoverable amount based on individual construction. If difficult to do so, the Company shall determine the recoverable amount of
the assets group on basis of the asset groups to which the construction in progress belongs.
18. Borrowing expenses
1. Recognition of the borrowing expenses capitalization
Borrowing expenses that attributed for purchasing or construction of assets that are complying with capitalizing conditions start to be
capitalized and counted as relevant assets cost; other borrowing expenses, reckoned into current gains and losses after expenses
recognized while occurred.
Assets satisfying the conditions of capitalization are those assets of fixed, investment real estate etc. which need a long period of time
to purchase, construct, or manufacturing before becoming usable.
Capitalizing for borrowing expenses by satisfying the followed at same time:
(1) Assets expense occurred, and paid as expenses in way of cash, non-cash assets transfer or debt with interest taken for purchasing,
constructing or manufacturing assets that complying with capitalizing condition;
(2) Borrowing expenses have occurred;
(3) Necessary activities occurred for reaching predicted usable statues or sale-able status for assets purchased, constructed or
manufactured.
2. Period of capitalization
Capitalizing period was from the time star capitalizing until the time of suspended capitalization. The period for borrowing expenses
suspended excluded in the period.
If purchasing, construction, or manufacturing process of an asset satisfying the conditions of capitalization reached its predicted
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usable status or sale-able status, capitalization suspended for borrowing expenses.
If purchasing, construction, or manufacturing process of an asset satisfying the conditions of capitalization completed projects and
usable independently for part of the projects, borrowing expenses for this kind of assets shall suspended capitalization.
If the assets have been completed in every part, but can be reached the useful status or sale-able status while completed entirely, the
borrowing expense shall be suspended for capitalization while the assets completely finished in whole.
3. Period of suspended
If purchasing, construction, or manufacturing process of an asset satisfying the conditions of capitalization is suspended abnormally
for over 3 months, capitalizing of borrowing expenses shall be suspended; the suspended assets that satisfying the conditions of
capitalization meets the necessary procedure of reaching predicted usable status or saleable status, capitalizing of borrowing expenses
shall be resumed. The borrowing expenses occurred during the period of suspended shall reckon into current gains and losses until
the purchasing, construction, or manufacturing process is resumed for capitalizing.
4. Calculation for capitalization amount
Interest expenses practically occurred at the current term of a special borrowing are capitalized after deducting of the bank saving
interest of unused borrowed fund or provisional investment gains
Capitalization amounts of common borrowings are decided by the weighted average of exceeding part of accumulated asset expenses
over the special borrowing assets multiply the capitalizing rate of common borrowings adopted. Capitalization rates are decided by
the weighted average of common borrowings.
For those expenses with discount or premium, determined the amortizable discount or premium in every fiscal year by effective
interest method, than adjusted interest amount in every period
19. Biological assets
1. Classification
The biological assets of the Company refer to consumptive biological assets and productive biological assets. The consumptive
biological assets including young and livestock etc., productive biological assets including eggs etc.
Biological assets are recognized upon satisfaction of the following conditions:
(1) The company owns or controls the biological asset due to the past transaction or proceeding;
(2) The economic benefits or service potential related to the biological assets are likely to flow into the company;
(3) Cost of the biological assets can be measured reliably.
2.Initial measurement of biological assets
Biological assets acquired by the Company is initially measured at the acquired cost. Cost of purchasing biological assets comprises
of purchase price, relevant tax, delivery expense, insurance premium and other expenditure directly attributable to purchase of such
asset. Biological assets injected by investors are accounted for with the value set out in the investment contract or agreement plus tax
payable as the carrying value of the assets. However, if the value set out in the contract or agreement is not fair, the actual cost shall
be determined at fair value.
3.Subsequent measurement of biological assets
(1)Subsequent expenditure
The cost of a consumptive biological asset that is propagated or bred by the Company itself is determined according to the necessary
expenses, such as the feed fee, the labor cost and the indirect cost that should be allocated before the sale. Cost of the self
propagating productive biological assets is determined according to the necessary expenses, such as the feed fee, the labor cost and
the indirect cost that should be allocated before the asset satisfies the expected production and operation purposes. The subsequent
expenditures of biological assets occurred after the asset satisfies the expected production and operation purposes, such as
management and maintenance, raising expenses, etc, are recorded in current profits and losses.
(2)Depreciation of productive biological assets
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For such productive biological assets as satisfy their expected production and operation purposes, the Company makes provision of
depreciation over their periods on an average basis. The Company determines its service life and anticipated net residual value
according to the nature and service condition of the productive biological assets and the anticipated implementation way of the
related economic interests. At the end of the year, the Company re-checks the service life, anticipated net residual value and
depreciation method of the productive biological assets, and adjusts correspondingly if it differs from the original assessment.
The expected service life, anticipated net residual value and yearly depreciation of the productive biological assets of the Company
are as follows:
Category Estimated useful life (Year) Estimated residual rate Yearly depreciation rate
Eggs 1 5% 95%
Sheep and pigs 3 5% 31.67%
(3)Disposal of biological assets
The Company adopts weighted average method to carry forward cost of consumptive biological assets when acquiring or disposing
such asset; cost of a biological asset after change of purpose is determined based on the carrying value as of such change; for sale,
destroy or deficit of a biological asset, the balance between the disposal income less carrying value and relevant taxes should be
recorded in current profit or loss.
4. Impairment of biological assets
The Company conducts inspection of consumptive and productive biological assets at least once at the end of each year. If there is
any evidence proving that the net realizable value of consumptive biological assets or recoverable amount of productive biological
assets is less than carrying value due to natural disaster, disease or insect pests, animal epidemic disease invasion or market demand
change, the assets shall be measured at net realizable value or recoverable amount.For any difference lower than the carrying value,
the Company makes devaluation provision or impairment provision for biological assets and records in current profit or loss.
In case that the factors affecting impairment of consumptive biological assets disappear, the reduced amount shall be restored and
reverted from the devaluation provision previously made with the amount reverted recorded in current profit or loss. However,
impairment provision for productive biological assets, once made, will be reverted in no way.
20. Oil and gas asset
21. Intangible assets
(1) Pricing method, service life and impairment test
An intangible asset is an identifiable non-monetary asset without physical substance owned or controlled by the Company, including
land use right and non-patented technology etc.
1. Initial measurement of intangible assets
For those intangible assets purchased from outside, the purchase value, relevant taxes and other payments attributable to predicted
purpose obtained should recognized as cost for this assets. For those purchased amount that paid overdue exceeded the normal credit
condition, owns financing natures actually, the cost should be recognized based on the current value while purchased
As for the intangible assets acquired from the debtor in debt restructuring for the purpose of settlement of debt, the fair value of the
intangible assets shall be based to determine the accounting value. The difference between the carrying value of restructured debt and
the fair value of the intangible assets use for settlement of debt shall be recorded in current gains and losses.
With the preceding conditions that non-monetary assets exchange has commerce nature and the fair value of the assets exchanged in
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or out can be measured reliably, the intangible assets exchanged in through non-monetary assets exchange are accounted at the value
based on the fair value of assets exchanged out, unless there is obvious evidence showing the fair value of assets exchanged in is
more reliable; for non-monetary assets exchange not qualifying for the preceding conditions, the carrying value of assets exchanged
out and related taxes payable shall be viewed as the cost of intangible assets exchanged in, without recognition of gains and losses.
Intangible assets obtained by means of enterprise combined under common control, recognized book-keeping value by the book
value of combined party; Intangible assets obtained by means of enterprise combined under different control, recognized
book-keeping value by the its fair value.
For those cost of intangible assets development internally including: the used materials, labor cost and register charge for
development; amortization for other patent and concession used and interest expense satisfying the capitalization condition during
process of development; other directly expense before reached its predated useful purpose.
2.Subsequent measurement
Analysis and determined the service life for intangible assets while obtained. And classified into intangible assets with limited useful
life and assets without certain service life
(1) Intangible assets with limited useful life
Those intangible assets with limited useful life are evenly amortized on straight basis from the date when they become useful to the
end of expected useful life. Particular about the estimation on intangible assets with limited service life:
Item Predicted useful life Basis
Patent right, trademark right, non-patents 5-year Within the terms of contractual rights or other
and outsourcing software statutory rights
Land Use Right 50-year Within the terms of contractual rights or other
statutory rights
At end of year, revising will be performed on the useful life of intangible assets with limited useful life and the methods of
amortizing, if there is a difference with the original estimation, adjustment shall be implemented correspondingly
Being revised, the useful life of intangible assets and amortization method at period-end shows the same as previous
(2) Judgment basis of criterion for intangible assets without certain service life
Intangible assets for which it is impossible to predict the term during which the assets can bring in economic benefits are viewed as
intangible assets with indefinite life.
Intangible assets with indefinite life are not amortized during the holding period, and useful life is re-reviewed at the end of each
accounting period. In case that it is still determined as indefinite after such re-review, then impairment test will be conducted
continuously in every accounting period.
At end of year, revising will be performed on the useful life of intangible assets with uncertain life.
The Company has no such intangible assets without certain service life after review.
(2) Accounting policy for expenditure of internal R&D
1. Detail standard for classification on research stage and exploitation stage
Research stage: stage of a planned investigation or research activity designed to acquire and understand new scientific or
technological knowledge.
Exploitation stage: stage of the activities that produced new or material advance materials, devices and products that by research
results or other knowledge adoption in certain plan or design before the commercial production or usage.
The expenditure of the research stage in R&D project internally shall reckon into current gains and losses while occurred.
2. Standards for capitalization satisfaction of expenditure in exploitation state
Intangible assets recognized for expenditure in exploitation stage by satisfying the followed at same time:
(1) Owes feasibility in technology and completed the intangible assets for useful or for sale;
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(2) Owes the intention for completed the intangible assets and for sale purpose;
(3) The way in which intangible assets generate economic benefits include proving that the products produced by the intangible
assets exist in the market or that the intangible assets them selves exist in the market, that the intangible assets will be used internally
and that their usefulness can be proved;
(4) Possess sufficient technique, financial resources and other resources for the development of kind of intangible assets and has the
ability for used or for sale;
(5) The expenditure attributable to the exploitation stage for intangible assets could be measured reliably.
22. Impairment of long term assets
Long term asset is judged whether for which there is indication of impairment on balance sheet date. If there is indication of
impairment, the Company would estimate its recoverable amount based on single asset; if it is difficult to estimate the recoverable
amount of single asset, then the assets group which the single asset belongs to is based to determine the recoverable amount of the
assets group.
Recoverable amount of an asset is determined at the higher of its fair value less disposal fee and present value of its predicted future
cash flow.
If measurement of recoverable amount shows that the recoverable amount of long term asset is lower than carrying value, and then
the carrying value shall be deducted to recoverable amount, with the deducted amount recognized as impairment loss which is
included in current period gains and losses, meanwhile, asset impairment provision shall be made accordingly. Once recognized,
asset impairment loss would not be reversed in future accounting period.
Once an asset is recognized for impairment loss, its depreciation or amortization expense would be adjusted in future periods, so as to
systematically allocate the adjusted asset carrying value (after deduction of predicted net residual value) during the remaining useful
life.
Goodwill arising from business combination and intangible assets with indefinite useful life shall be tested annually for impairment
whether or not there is indication of impairment.
Goodwill is tested for impairment with the related assets group. When conducting impairment test for relevant asset group with
inclusion of goodwill, in case that there is indication of impairment for such asset group, impairment test would be firstly conducted
in respect of the asset groups without inclusion of goodwill. Then, it shall calculate the recoverable amount and determine the
corresponding impairment loss as compared to its carrying value. Second, asset group with inclusion of goodwill would be tested for
impairment. If it is found after comparison between the carrying value and recoverable amount of the asset group that the recoverable
amount is less than carrying value, the Company would recognize impairment loss for goodwill.
23. Long-term expenses to be apportioned
1. Amortization method
Long term prepaid expense represents the expense which the Company has occurred and shall be amortized in the current and later
periods with amortization period exceeding one year. Long term prepaid expense amortized on straight-line method by stages in
benefit period.
2. Amortization term
Amortized equally during the benefit period for those long-term expenses whose has a defined benefit period, for those without a
defined benefit period, amortized equally within 5 years.
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24. Staff remuneration
(1) Accounting treatment of short-term remuneration
Staff remuneration refers to various forms of remuneration or compensation provided by the Company for services provided by
employees or termination of employment relations. Staff remuneration includes short-term payoff, post employment benefits,
dismissal benefits and other long-term employee benefits.
Short term remuneration refers to all the staff remuneration payable by the Company to its staff within 12 months after the end of
annual reporting period in which staff provides relevant services, other than post office benefit and dismissal benefits. The Company
recognizes short term remuneration payable as liabilities during the accounting period during which staff provides services, and
includes in cost and expense of relevant asset according to the beneficial parties of such services.
(2) Accounting treatment of post office benefits
Post office benefits refer to kinds of remuneration or benefits granted by the Company to staff for their provision of service upon
retirement or release of employment, other than short term remuneration and dismissal benefits. Post benefit plan is categorized as
defined withdraw plan and defined benefit plan.
Defined withdraw plan under post office benefit mainly represents participation into social basic pension insurance and
unemployment insurance operated by labor and social security authorities. During the accounting period when employee provides
services for the Company, the contribution calculated under defined withdraw plan would be recognized as liabilities and included in
current gains and losses or relevant asset cost.
Defined benefit plans for post-employment benefits are primarily clear and standard outside-plan welfareto pay the retirees and pay
theliving expenses for the deceased employees’ family members. For the obligation assumed in the defined benefit plans, the
independent actuaries will accurately calculate by using the expected cumulative actuarial unit credit method on the balance sheet
date, attribute the benefit obligations arising from defined benefit plan to the period of employee providing services, and include in
the current profit or loss or associatedasset cost, thereinto, unless other accounting standards require or allow the employee benefits
costs to be included in the asset cost, the service costs of defined benefit plans and the net interest of net indebtedness and net assets
of defined benefit plans should be included in the current profit and loss in the current occurrence period; changes in the net
indebtedness and net assets of re-measured defined benefit plans should be included in theother comprehensive income in the current
occurrence period, and are not allowed to switch back to profit and loss in the follow-up accounting period.
(3) Accounting treatment of dismissal benefit
Dismissal benefit represents compensation paid to employees for release of employment before expiration or as compensation for
their willing of cut, if the Company cannot recall the dismissal unilaterally or re-organization-related costs with dismissal benefit
involved in cutting down, the liability arising from compensation for recognition of labor relationship released, reckoned into current
gains/losses at the same time.
(4) Accounting treatment of other long term staff benefits
25. Accrual liability
When the Company is involved in proceedings, debt guarantees, onerous contracts and reorganization events, if such events may
require delivery of assets or rendering of services in the future and the amounts of such events can be reliably measured, accrued
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liabilities are recognized.
1. Recognition criteria of accrued liability
The Company recognizes the accrued liabilities when obligations related to contingencies satisfy all the following conditions:
This obligation is a present obligation of the Company;
The performance of such obligation is likely to result in outflow of economic benefits from the Company; and
The amount of the obligation can be measured reliably.
2. Method of measuring of accrued liabilities
Accrued liabilities shall be initially measured at the best estimate of the expenditure required to settle the related present obligation.
The Company, when determining the best estimate, has had a comprehensive consideration of risks with respect to contingencies,
uncertainties and the time value of money. If the time value of money is significant, the best estimate shall be determined after
discounting the relevant future outflow of cash.
The best estimate will be dealt with separately in the following circumstances:
The expenses required have a successive range (or band), in which the possibilities of occurrence of each result are the same, and the
best estimate should be determined as the middle value for the range, i.e. the average of the upper and lower limit.
The expenses required does not have a successive range (or band), or although there is a successive range (or band), the possibilities
of occurrence of each result are not the same, if the contingency is related to individual item, the best estimate should be determined
as the most likely amount; where the contingency is related to a number of items, the best estimate should be calculated and
determined according to the possible results and the relevant possibilities.
When all or part of the expenses necessary for the settlement of an estimated liability of the Company is expected to be compensated
by a third party, the compensation should be separately recognized as an asset only when it is virtually certain that the compensation
will be received. The amount recognized for the compensation should not exceed the book value of the estimated liability.
26. Share-based payment
1. Category of share-based payment
Share-based payment of the Company divided into share-based payment settled by equity and by cash
2. Determination of fair value of equity instruments
If there is an active market for an equity instrument granted such as share option, the quoted price in the active market is used to
establish the fair value of the equity instrument. If there is no active market for the equity instrument granted such as share option,
the option pricing model is used to determine the fair value. Option pricing model is elected after taking into account the following
factors: (1) Exercise price of the option; (2) Effective period of the option; (3) Prevailing price of the subject shares; (4) Predicted
fluctuation rate of share prices; (5) Predicted dividend of shares; (6) Risk-free interest rate of the option in effective period.
When determining fair value of equity instruments on the date of grant, influences from market conditions among conditions
available for exercising rights and those not available for exercising rights as provided in share-based payment agreement should be
considered. If there is condition not available for exercising rights in respect of share-based payment, cost expenses attributable to
services received can be recognized provided that employees or other parties satisfy all the non-market conditions among conditions
available for exercising rights (such as service term).
3. Bases for determining the best estimate for equity instruments with feasible rights
On each balance sheet date during the vesting period, best estimate shall be made based on the latest available information on change
of employees who are entitled to exercise right, and number of equity instruments of the feasible rights shall be amended accordingly.
On the feasible date, the number of instruments of the feasible rights and interests is eventually predicted to be the same as the actual
number of feasible rights.
4. Accounting treatment method
Equity-settled share-based payment is measured at fair value of equity instruments granted to staff. For equity instruments which are
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exercise immediately upon grant, they are included in relevant costs or expenses at fair value of the instruments as of the date of
grant, with increase of capital reserve accordingly. For instruments for which exercise is conditional upon completion of service in
vesting period or satisfaction of required results, services received in current period are included in relevant costs or expenses and
capital reserve at the fair value of the equity instrument as of the date of grant based on the best estimate of the feasible rights of
equity instruments on each balance sheet date during the vesting period. Recognized relevant costs or expense and total owners’
equity will not be adjusted after the exercise date.
The cash-settled share-based payment shall be measured at the fair value of liabilities identified on the basis of shares or other equity
instruments undertaken by the Group. For the instruments that may be exercised immediately after the grant, the fair value shall, on
the date of the grant, be recognized in relevant costs or expenses and the liabilities shall be increased accordingly. For instruments
that cannot be exercised until the services are fully provided during vesting period or specified performance targets are met, on each
balance sheet date within the vesting period, the services acquired in the current period shall, based on the best estimate of the
feasible rights, be recognized in relevant costs or expenses and the corresponding liabilities at the fair value of the liability incurred
by the Group. The Group shall, on each balance sheet date and on each account date prior to the settlement of the relevant liabilities,
re-measure the fair values of the liabilities and include the changes in the profit or loss for the period.
5. Amendment and relevant accounting treatment for those with amendment clauses and condition concerned
During the vesting period, where an equity instrument award is canceled, it is treated as if it had vested on the date of cancellation,
and any expense not yet recognized for the award is included immediately into the profit or loss for the period and capital reserve is
recognized. Where employees or other parties are permitted to choose to fulfill non-vesting conditions but have not fulfilled during
the vesting period, equity instrument award are deemed canceled.
27. Other financial instrument as preferred stock and perpetual capital securities
28. Revenue
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
Real estate industry
Revenue of the Company mainly including revenue from goods selling, sale of real estate, and revenue from property rent-out and
labor service revenue etc.
1. Recognition standards of income from commodity sales:
When main risks and rewards attached to the ownership of goods have been transferred to the buyer, reserved neither continuous
management power nor effective control over the goods, incoming payment can be measured reliably, relative financial benefit
possibly inflow to the company, cost occurred or will occur can be reliably measured, sales income of goods is recognized.
2. Sales revenue recognition for property industry:
(1) Construction completion and qualified acceptance of properties;
(2) Commercial property pre-sale license granted by relevant state resources and housing bureau;
(3) Enter into sales contract;
(4) Sales contract has been certified and confirmed by property exchange center;
(5) Receive property price or obtain payment certificate from buyers;
(6) Complete deliver procedure for commercial properties.
Upon satisfaction of all the above conditions, the Company recognizes sales revenue
3. Recognition of property leasing revenue:
Property leasing revenue is recognized when the Company receives rental or obtain payment certificate from buyers based on the
payment date and rental amount to be paid by lessee as provided in the contract or agreement entered into between the Company and
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the lessee.
4. Labor service revenue
(1) Income of the contract can be measured reliably
(2) Financial benefit attached to the contract is possibly inflow to the company
(3) Schedule of the contracted project can be determined reliably;
(4) And the relevant amount of cost incurred or to be incurred can be measured reliably
5. Recognition basis of revenue from transferring the use right of assets
The economic benefits related to transactions are probable to flow into the Company; and amount of revenue can be measured
reliably.
29. Government grants
1.Type
Government grant represents the monetary and non-monetary assets of the Company obtained from government agencies for free.
Depending on the grantees under relevant government documents, government grant is classified into grant related to assets and
income, respectively.
For such government grant under which no specific grantee is defined, it is classified as grant related to assets or income depending
on the actual grantee. The details relating to relevant judgment reference is set out in note VI to this financial statement - deferred
income/non-operating income.
Government grant related to assets refers to that obtained by the Company for the purpose of acquiring or otherwise forming long
term assets. Government grant related to income refers to that other than that related to assets.
2.Realization of government grant
Where there are evidences showing that the Company meets the requirements of the financial supporting policies and it is expected
that the financial supporting funds will be received, the government grant is recognized on the receivables. Otherwise, the
government grant is recognized when actually received.
The grant is measured as the amount received or receivable where it takes the form of a cash asset, or at fair value where it is not a
cash asset. Where the fair value cannot be reliably obtained, it should be measured at the nominal value (RMB1.00). government
grants measured at nominal value will be recorded in profit or loss for the period directly.
3.Accounting treatment
Government grant related to assets constructed or purchased is realized as deferred income, and included in profit or loss by stages
over the assets’ useful life in a reasonable and systematic manner;
Government grant related to income, if it is used to compensate relevant expense or loss of a company to be occurred in future
periods, shall be recognized as deferred income and included in profit or loss during the period in which the above expense or loss is
recognized; if it is used to compensate relevant expense or loss of a company incurred, it shall be included in profit or loss upon
acquisition.
Government grant related to a company’s normal operation is recognized as other income, and otherwise, as non-operating income or
expense.
Borrowing expense shall be reduced against the government grant received by a company provided that the grant is related to policy
preferential loan discount. If the Company is granted by lending bank with policy preferential loan interest, the amount of borrowing
actually received shall be taken as the carrying value of the borrowing with borrowing expense calculated based on principal of the
borrowing and such policy preferential loan interest.
If a government grant recognized is required to return, carrying value of the asset shall be adjusted if the carrying value is written
down at initial recognition; balance of carrying value of deferred income shall be written down if there such balance exists with the
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amount of excess included in current profit or loss; it shall be directly included in current profit or loss if no relevant deferred income
exists.
30. Deferred income tax assets / Deferred income tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognized according to the balance between the tax base and the
book value of assets and liabilities (temporary differences). At the balance sheet date, the deferred tax assets and deferred tax
liabilities are measured by theapplicable tax rate during the period of expected recovery of assets or clearing off the liability.
1. The basis for confirming deferred tax assets
The Company takes the taxable income which is likely to be obtained for deducting the deductible temporary differences and can
carry over the deductible loss and tax credits as the limit to confirm the deferred income tax assets generated by deductible temporary
differences. However, the deferred income tax assets generated by the initial recognition of assets or liabilities in the transactions
with following characteristics shall not be recognized: (1) The transaction is not a business combination; (2) The occurrence of
transaction affects neither the accounting profit nor the taxable income or deductible loss.
For the deductible temporary differences associated with investments in associated enterprises and satisfying the following
conditions, confirm the corresponding deferred income tax assets: temporary difference is likely to be reversed back in the
foreseeable future, and it is likely to obtain the taxable income used for deducting the deductible temporary differences in the future.
2. The basis for confirming deferred tax liabilities
The company recognizes the currently and previously payable but not paid taxable temporary differences as the deferred income tax
liabilities. But not including:
(1) The temporary differences formed in the initial recognition of goodwill;
(2) Transactions or events formed by non-business combination, and it affects neither the accounting profit nor the temporary
differences formed by taxable income (or deductible loss) when the transactions or events occur;
(3) For the taxable temporary differences related to the subsidiary companies and investments in associated enterprises, the reversal
time of this temporary difference can be controlled and this temporary difference is unlikely to be reversed back in the foreseeable
future.
3. Deferred tax assets and liabilities are offset if all the following conditions are met
(1) An enterprise has the legal rights to settle the income tax assets and income tax liabilities for the current period by net amount;
(2) They relate to income taxes levied by the same tax authority on either the taxable entity has a legally enforceable right or set off
current income tax assets against current income tax liabilities, and different taxable entities which either intend to settle the current
income tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in
which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.
31. Lease
(1) Accounting treatment of operation lease
If a lease contains such clause that substantially transfers to the lessee all the risks and reward related to the ownership of the leased
asset, this lease is accounted for as financial leasing, and others are operating leases.
(1) Assets under operation lease-in
The lease payment paid for leasing assets is amortized under straight line method in the entire lease period without deduction of
lease-for-free period, and is recorded in current expenses. The initial direct expenses paid by the Company related to lease
transactions shall be recorded in current expenses.
If asset leaser assumes the lease related expenses which shall be assumed by the Company, the Company shall deduct such expenses
from the total rental and amortize based on the deducted rental expenses during the lease period and record in current expenses.
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(2) Assets under operation rent-out
The lease fee collected by the Company for assets lease is amortized under straight line method in the entire lease period without
deduction of lease-for-free period, and is realize as lease income. The initial direct expenses paid by the Company related to lease
transactions shall be recorded in current expenses; for significant amount, it shall be capitalized and recorded in current income in
phases under the same basis as realization of lease income in the entire lease period.
If the Company assumes the lease related expenses which shall be assumed by the lessee, the Company shall deduct such expenses
from the total rental income and allocate based on the deducted rental expenses during the lease period.
(2) Accounting treatment of financing lease
(1) Assets leased by financing lease: the Company accounts the leased assets at the lower of the fair value of leased assets and
present value of the minimum lease payment on the inception date of the lease, and the minimum lease payment is deemed as the
accounting value of long term account payable, and the difference is taken as unrealized financing expenses. The identification basis,
evaluation and depreciation method for assets leased by financing lease found more in the Fixed assets in Note IV (15)
The Company amortizes the unrealized financing expenses at effective interest rate method in the asset lease period and records in
finance expenses.
(2) Assets leased out by financing lease: at the beginning of the lease, the Company recognizes the difference between the sum of
financial lease receivable and the unsecured residual value and its present value as unrealized financing income, and recognized as
rental income during the period of rents accepted; the initial direct expenses incurred by the Company in connection with the lease
transaction are included in the initial measurement of financial lease receivable and the amount of revenue recognized during the
lease period is reduced.
32. Other important accounting policies and accounting estimates
Discontinued operation
The Company recognizes a component as discontinued operation component if it meets any of the following conditions, it has been
treated or classified as held for sale and can be distinguished from others:
(1)the component represents an independent major business or a separate major operation region.
(2)the component is a part of a related plan proposed for the purpose of treatment of an independent major business or a separate
major operation region.
(3)the component is a subsidiary particularly acquired for resale.
Impairment loss, reverted amount and other operating gains and losses or disposal gains and losses of discontinued operation are
presented in profit statement as profit or loss from discontinued operation.
33. Changes of main accounting policy and estimate
(1) Changes of accounting policies
√Applicable □ Not-applicable
Content and reasons for accounting policy
Approval procedure Note
changed
Explanation on change of items in financial statement
On June 15, 2018, the Ministry of Finance issued the Notice on Amending the Format of Financial Statements of General Enterprises
in 2018 (CK No. [2018] 15), revised the financial statements format of general enterprises, merged some of the balance sheet items,
and split some of the income statement items; and issued the Interpretation of the Issues Concerning the Format of Financial
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Statements of General Enterprises in 2018 on September 7, 2018, clearly requiring that the handling charge of withholding the
personal income tax be returned to the ―other income‖ presentation, and the actually received government subsidies whether related
to assets or related to income were presented as cash flows from operating activities when preparing the cash flow statement.
The Company prepared financial statements in accordance with the requirements of the new enterprise financial statement format,
and the presentation items of the financial statements changed, and the comparative data during the comparable period were adjusted
in accordance with the relevant provisions of the Accounting Standards for Business Enterprises No. 30 – Presentation of Financial
Statements.
The impacts on the items and amounts of the presentation of financial statements during the comparable periods were as follows:
31st Dec. 2017/Items for 2017 Before adjustment Amount affected After adjustment
Note receivable --- --- ---
Account receivable 17,608.00 -17,608.00 ---
Note receivable and account --- 17,608.00 17,608.00
receivable
Interest receivable --- --- ---
Dividend receivable --- --- ---
Other account receivable 58,740,204.94 --- 58,740,204.94
Note payable --- --- ---
Account payable 15,487,833.06 -15,487,833.06 ---
Note payable and account --- 15,487,833.06 15,487,833.06
payable
Interest payable --- --- ---
Dividend payable --- --- ---
Other account payable 25,952,193.34 --- 25,952,193.34
Management expense 29,677,261.30 -124,889.69 29,552,371.61
R&D expense --- 124,889.69 124,889.69
(2) Changes in important accounting estimates
□Applicable √ Not-applicable
34. Other
VI. Taxes
1. Main tax category and tax rate
Taxes Basis Rate
Sales of goods, taxable sales service
VAT 5%-16%
income, intangible assets or real property
Urban maintenance and construction tax Turnover tax payable 5%
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Enterprise income tax Taxable income 25%, 16.5%(Hong Kong, China)
Land appreciation tax Appreciation value or prerequisitioned Progressive rates
Educational surtax Turnover tax payable 3%
Local educational surtax Turnover tax payable 2%
Rental income or original value of the
Property tax 12% or 1.2%
property
As for the taxpaying body with different tax rate for enterprise income tax, disclosed explanations:
Taxpaying body Rate for income tax
Dongfeng Sci-Tech Group 25%
Nanjiang Trading 25%
Kefeng Engineering 25%
Dongfeng Investment 25%
Nanjiang Asia 16.5%
Kefeng Trading 25%
Hangzhou Dongfeng 25%
Dongguan Dongfeng Technology 25%
Kefeng Aerospace 25%
Dongfeng Power 25%
Ecological Agriculture 25%
Nanjiang Technology 25%
Huijing Property 25%
Zhongchuang New Energy 25%
Dongguan Dongfeng Intelligent 25%
Aolin New Materials 25%
Haizhuo Energy 25%
2. Tax preference
3. Other
In accordance with the provisions of the Notice on Adjusting the Value-Added Tax Rate (CS No. [2018] 32) of the Ministry of
Finance and the State Administration of Taxation, the tax rate of the Company’s VAT taxable sales or imported goods which was
previously applicable for 17% and 11% has been respectively adjusted to 16% and 10% since May 1, 2018.
Nanjiang Asia paying taxes in Hong Kong Special Administrative Region (HKSAR) with income tax rate of 16.5%
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VII. Notes to the main items of consolidate financial statements
1. Monetary fund
In RMB
Item Ending balance Opening balance
Cash in stock 368,614.69 61,945.60
Bank deposit 12,986,115.85 68,045,443.09
Other monetary funds 22,952,094.56 6,697,820.37
Total 36,306,825.10 74,805,209.06
Including: total amount deposit aboard 5,626,045.88 5,356,719.91
Other explanation
Monetary fund with restrictions:
Item Ending balance Opening balance
Margin of housing mortgage 2,793,908.11 6,697,820.37
Total 2,793,908.11 6,697,820.37
2. Derivative financial assets
□Applicable √ Not-applicable
3. Note receivable and account receivable
In RMB
Item Ending balance Opening balance
Account receivable 11,171.25 17,608.00
Total 11,171.25 17,608.00
(1)Account receivable
1)Account receivable by types
In RMB
Ending balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Type Book
Proportio Provision Proportio Provision Book value
Amount value Amount
Amount Amount
ratio ratio
n n
Accounts receivable 2,320,04 2,320,04 2,320,0 2,320,047
94.84% 100.00% 94.84% 100.00%
with large single 7.40 7.40 47.40 .40
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东沣科技集团股份有限公司 2018 年年度报告全文
amount and accrued
for provision of bad
debt on a single basis
Accounts receivable
accrued for provision 82,138.8 70,967.6 82,138.
3.36% 86.40% 11,171.25 3.36% 64,530.85 78.56% 17,608.00
of bad debt by 5 0 85
portfolio
Accounts receivable
with minor single
44,172.0 44,172.0 44,172.
amount but accrued 1.81% 100.00% 1.80% 44,172.00 100.00%
0 0 00
for provision of bad
debt on a single basis
2,446,35 2,435,18 2,446,3 2,428,750
Total 100.00% 99.54% 11,171.25 100.00% 99.28% 17,608.00
8.25 7.00 58.25 .25
Accounts receivable with large single amount and accrued for provision of bad debt on a single basis at period-end
√Applicable □ Not-applicable
In RMB
Ending balance
Account receivable(unit)
Account receivable Bad debt provision Provision ratio Reasons of accrual
Beijing Xiangeqing
Industrial & Trade Co., 2,320,047.40 2,320,047.40 100.00% Uncollectible
Ltd.
Total 2,320,047.40 2,320,047.40 -- --
Accounts receivable accrued for provision of bad debt by aging analysis method in portfolio
√Applicable □ Not-applicable
In RMB
Ending balance
Account age
Account receivable Bad debt provision Provision ratio
Within 1 year
1-2 years 10,150.00 2,030.00 20.00%
2-3 years 6,102.50 3,051.25 50.00%
Over 3 years 65,886.35 65,886.35 100.00%
Total 82,138.85 70,967.60 86.40%
Portfolio recognized:
Accrued for bad debt provision of account receivable by balance proportion method in portfolio :
□Applicable √ Not-applicable
Accrued for bad debt provision of account receivable by other method in portfolio :
2)Provision for bad debts accrued, regain or switch back in the period
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In the Period, RMB 6,436.75 accrued for provision of bad debts; RMB 0.00 provision for bad debts regains or switch back in the
Period.
Including major amount of bad debt provision regain or switch back in the Period:
In RMB
Unit Amount regain or switch back Way of regain
3)Account receivable actual charge off in the Period
In RMB
Item Amount charge off
Charge-off for the major receivable:
In RMB
Arising from related
Unit Nature Amount charge off Reasons Procedures
transaction (Y/N)
Explanation on:
4)Top five account receivables collected by arrears party at ending balance
Unit Ending balance Ratio in account Bad debt provision
receivable at accrued
period-end(%)
Beijing Xiangeqing Industrial & Trade 2,320,047.40 94.84 2,320,047.40
Co., Ltd.
Electricity Authority of Chengde 82,138.85 3.36 70,967.60
County
Inner Mongolia Ajinnai Horse Culture 44,172.00 1.80 44,172.00
Development Co., Ltd.
Total 2,446,358.25 100.00 2,435,187.00
(5) Account receivable de-recognition due to financial assets transfer
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Other explanation :
4. Accounts paid in advance
(1)Accounts paid in advance by account age
In RMB
Ending balance Opening balance
Account age
Amount Proportion Amount Proportion
Within one year 61,088,678.72 99.98% 171,695.28 93.52%
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东沣科技集团股份有限公司 2018 年年度报告全文
1-2 years 3,431.50 0.01% 11,899.78 6.48%
2-3 years 6,899.45 0.01%
Total 61,099,009.67 -- 183,595.06 --
Reasons for significant repayment with over one year age without settle:
(2)Top five prepayment collected by objects at ending balance
Unit Ratio in
Time of
Ending amount prepaymen Un-settle reasons
repayment
t (%)
Chengde Wanxuan Construction Engineering Co., 60,038,761.00 Within one Not in settlement
98.26
Ltd. year period
Beijing Jianyan Lianhe Architectural Design 600,000.00 Within one Not in settlement
0.98
Consulting Co., Ltd. year period
Elfa International Supply Chain Management Co., Within one Not in settlement
205,784.00 0.34
Ltd. year period
Within one Not in settlement
Wu Xiaojie 122,400.00 0.20
year period
Within one Not in settlement
Shenzhen Sinmary Technology Co., Ltd. 11,500.00 0.02
year period
Total 61,742,761.00 99.80 --- ---
Other explanation :
5. Other account receivable
In RMB
Item Ending balance Opening balance
Other account receivable 8,588,597.44 58,740,204.94
Total 8,588,597.44 58,740,204.94
(1)Other account receivable
1)Other account receivable by types
In RMB
Ending balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Type Book
Proportio Provision Proportio Provision Book value
Amount value Amount
Amount Amount
ratio ratio
n n
Other receivables 2,709,27 19.47% 2,709,27 100.00% 2,709,2 4.24% 2,709,273 100.00%
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东沣科技集团股份有限公司 2018 年年度报告全文
with large single 3.00 3.00 73.00 .00
amount and accrued
for provision of bad
debt on a single basis
Other receivables
accrued for provision 9,117,72 544,864. 8,572,855 59,168, 442,594.6 58,725,942.
65.53% 5.98% 92.50% 0.75%
of bad debt by 0.05 61 .44 537.55 1 94
portfolio
Other receivables
with minor single
2,087,07 2,071,33 2,085,5 2,071,332
amount but accrued 15.00% 99.25% 15,742.00 3.26% 99.32% 14,262.00
4.08 2.08 94.08 .08
for provision of bad
debt on a single basis
13,914,0 5,325,46 8,588,597 63,963, 5,223,199 58,740,204.
Total 100.00% 38.27% 100.00% 8.17%
67.13 9.69 .44 404.63 .69 94
Other receivables with large single amount and accrued for provision of bad debt on a single basis at period-end:
√Applicable □ Not-applicable
In RMB
Other account Ending balance
receivable(unit) Other account receivable Bad debt provision Provision ratio Reasons of accrual
Non-Taxable Revenue
Authority of Chengde 1,500,000.00 1,500,000.00 100.00% Uncollectible
County
Claims obtained from
1,209,273.00 1,209,273.00 100.00% Uncollectible
auction
Total 2,709,273.00 2,709,273.00 -- --
Other receivables accrued for provision of bad debt by aging analysis method in portfolio :
√Applicable □ Not-applicable
In RMB
Ending balance
Account age
Other account receivable Bad debt provision Provision ratio
Within 1 year
Subtotal within one year 3,581,860.41 179,929.56 5.00%
1-2 years 67,447.43 13,489.49 20.00%
2-3 years 48,200.00 24,100.00 50.00%
Over 3 years 327,345.66 327,345.56 100.00%
Total 4,024,853.50 544,864.61 13.54%
Portfolio recognized:
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Other accounts receivable accrued for provision of bad debt by percentage of balance in portfolio :
□Applicable √ Not-applicable
Other accounts receivable accrued for provision of bad debt by other methods in portfolio :
√Applicable □ Not-applicable
Combination Ending balance
Other account receivable Bad debt provision Provision ratio (%)
Tax Bureau of Chengde County 4,942,346.42 --- ---
Chengde Nanjiang Trading Co., Ltd. 135,241.42 --- ---
Social insurance 14,928.06 --- ---
LIMITED 350.65 --- ---
Total 5,092,866.55 --- ---
2)Bad debt provision accrual collected or switch back
There is 102,270.00Yuan provision for bad debts accrued in the Period; and Yuan regains or switch back in the Period.
Including the followed significant amount:
In RMB
Unit Regains or switch back Way of regain
3)Other receivables actually written-off during the reporting period
In RMB
Item Amount charge off
Major other account receivables written-off:
In RMB
Arising from related
Unit Nature Amount charge off Reasons Procedures
transaction (Y/N)
Explanation on other account receivable:
4)Other account receivable by nature of money
In RMB
Nature of money Ending book balance Opening book balance
Margin 1,520,000.00 1,762,154.50
Petty cash 1,485,155.23 872,244.72
Debt auction 1,209,273.00 1,209,273.00
Land acquisition account 51,360,000.00
Tax rebate 4,942,346.42
Other 4,757,292.48 8,759,732.41
Total 13,914,067.13 63,963,404.63
5) Top five other account receivables collected by arrears party at ending balance
139
东沣科技集团股份有限公司 2018 年年度报告全文
In RMB
Proportion in total
Ending balance of
Unit Nature Ending balance Account age Ending balance of
bad debt provision
other receivables
Tax Bureau of
VAT for lands rebate 4,942,346.42 Within one year 1.04%
Chengde County
Non-Taxable
Revenue Authority Margin 1,500,000.00 Over 3 years 0.32% 1,500,000.00
of Chengde County
Auction claims Debt auction 1,209,273.00 Over 5 years 0.26% 1,209,273.00
Zhou Haihong Other 642,689.25 4-5 years 0.14% 642,689.25
Bao Degang Other 356,838.00 Over 5 years 0.08% 356,838.00
Total -- 8,651,146.67 -- 1.84% 3,708,800.25
6)Account receivables related to government grant
In RMB
Account age at Time and amount
Unit Government grant Ending balance
period-end collected and basis
7) Other receivable for termination of confirmation due to the transfer of financial assets
8)The amount of assets and liabilities that are transferred other receivable and continued to be involved
Other explanation :
6. Inventory
Whether the company needs to comply with the disclosure requirements of the particular industry
Yes
(1)Classification of inventories
The Company needs to comply with the disclosure requirement of Information Disclosure Guidelines of Shenzhen Stock Exchange
No.3-engaged in real estate business for the listed companies
By nature:
In RMB
Ending balance Opening balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserve reserve
Development cost 107,073,123.28 107,073,123.28 86,747,495.40 86,747,495.40
Development
42,082,664.49 42,082,664.49 145,903,913.28 145,903,913.28
products
Raw materials 53,653.93 53,653.93 71,640.85 71,640.85
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东沣科技集团股份有限公司 2018 年年度报告全文
Production costs 1,442,179.44 1,442,179.44 1,749,205.68 1,749,205.68
Stock products 933,817.53 933,817.53 150,484.25 150,484.25
Revolving
118.83 118.83 28,170.33 28,170.33
materials
Consumptive
2,916.05 2,916.05
biological assets
Total 151,585,557.50 151,585,557.50 234,653,825.84 234,653,825.84
Disclose of ―development cost‖ and interest capitalization rate:
In RMB
Cumulati Including:
Increase
Estimated Switch to ve amount of
Estimated Other in Period
Name of Time to total Opening developm Ending amount of interest Source of
completio decrease (develop
project start investmen balance ent balance interest capitalizat funds
n time in Period ment
t products capitalize ion in
costs)
d Period
Tian Xi 1 Dec. 31 Dec. 380,000,0 86,747,49 20,325,62 107,073,1 543,616.4 543,616.4
Other
project 2018 2020 00.00 5.40 7.88 23.28 4 4
380,000,0 86,747,49 20,325,62 107,073,1 543,616.4 543,616.4
Total -- -- --
00.00 5.40 7.88 23.28 4 4
Disclose of ―Development products‖:
In RMB
Including: amount
Cumulative
Name of Time of Opening Current Current of interest
Ending balance amount of interest
project completion balance increased decreased capitalization in
capitalized
Period
Huijing 30 Sept. 145,903,913.2 103,821,248.7
42,082,664.49
Tiandi 2016 8 9
145,903,913.2 103,821,248.7
Total -- 42,082,664.49
8 9
Disclosed the ―installment development products‖, ―rental development products‖ and ―relocation housing‖:
In RMB
Name of project Opening balance Current increased Current decreased Ending balance
The Company needs to comply with the disclosure requirement of Information Disclosure Guidelines of Shenzhen Stock Exchange
No.11- Listed Companies Engaged in Related Business of Jewelry
(2)Inventory Depreciation reserve
Accrual for inventory depreciation reserves:
By nature:
141
东沣科技集团股份有限公司 2018 年年度报告全文
In RMB
Current increased Current decreased
Opening
Item Reversing or Ending balance Note
balance Accrual Other Other
write-off
By project:
In RMB
Current increased Current decreased
Opening
Name of project Reversing or Ending balance Note
balance Accrual Other Other
write-off
(3)Rate of capitalization of interest for inventory at period-end
(4) Inventory constrained
Disclosure by items:
In RMB
Name of project Opening balance Ending balance Reasons of restricted
(5)Assets completed without settlement from construction contract at period-end
In RMB
Item Amount
Other explanation :
Balance of inventory at period-end decreased 83,068,268.34 Yuan over that of period beginning with 35.40% declined, mainly
because the Huijing Tiandi project has completed the settlement last period, the development products are transfer to cost for sale
Does the Company comply with the disclosure requirement ofInformation Disclosure Guidelines of Shenzhen Stock Exchange No.4 –
Listed Companies Engaged in Seed Industry and Planting Business or not
No
7.Other current assets
In RMB
Item Ending balance Opening balance
Taxes paid in advance 10,986,874.66 2,029,505.29
Financial products 26,800,000.00 32,530,000.00
Total 37,786,874.66 34,559,505.29
Other explanation :
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东沣科技集团股份有限公司 2018 年年度报告全文
8. Finance asset available for sales
(1)Finance asset available for sales
In RMB
Ending balance Opening balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserves reserves
Equity instrument
25,000,000.00 8,668,962.92 16,331,037.08 25,000,000.00 8,329,596.87 16,670,403.13
available for sale:
Measured by cost 25,000,000.00 8,668,962.92 16,331,037.08 25,000,000.00 8,329,596.87 16,670,403.13
Total 25,000,000.00 8,668,962.92 16,331,037.08 25,000,000.00 8,329,596.87 16,670,403.13
(2)Financial assets available for sale measured by fair value at period-end
In RMB
Classification of finance Equity instrument Debt instrument
Total
asset available for sales available for sale available for sales
(3)Financial assets available for sale measured by cost at period-end
In RMB
Book balance Depreciation reserves Ratio of
share-holdi Current
Invested
Period-beg Current Current Period-beg Current Current ng in cash
company Period-end Period-end
in increased decreased in increased decreased invested dividend
entity
Dongguan
Dongfeng
New 25,000,000 25,000,000 8,329,596. 8,668,962.
339,366.05 2.56%
Energy .00 .00 87 92
Technolog
y Co. Ltd.
25,000,000 25,000,000 8,329,596. 8,668,962.
Total 339,366.05 --
.00 .00 87 92
(4)Change of financial assets depreciation for sale during reporting period
In RMB
Classification of finance Equity instrument Debt instrument
Total
asset available for sales available for sale available for sales
143
东沣科技集团股份有限公司 2018 年年度报告全文
Balance of accrual at
8,329,596.87 8,329,596.87
period-begin
Accrual in the period 339,366.05 339,366.05
Balance of accrual at
8,668,962.92 8,668,962.92
period-end
(5)Fair value of the available-for-sale equity instrument drops significantly or not contemporarily without
depreciation reserves accrued
In RMB
Decline range of
Times continued
Equity instrument fair value Amount accrual Reasons for
Investment cost Ending fair value to declined
available for sale compare with the for impairment un-accrual
(Month)
cost
Other explanation
9. Long-term equity investment
In RMB
Changes in Period
Investme
Ending
nt Adjustme
Cash balance
Additiona gains/loss nt of Provision
Invested Opening Other dividend Ending of
l Capital es other for
company balance equity or profit Other balance impairme
investmen reduction recognize comprehe impairme
changes declare to nt
t d by nsive nt losses
issue provision
equity income
method
I. Joint venture
II. Associated enterprise
Runhua
Rural
Water
9,170,370 9,170,370 9,170,370
(Tianjin)
.00 .00 .00
Internatio
nal Trade
Co., Ltd.
9,170,370 9,170,370 9,170,370
Subtotal
.00 .00 .00
9,170,370 9,170,370 9,170,370
Total
.00 .00 .00
144
东沣科技集团股份有限公司 2018 年年度报告全文
Other explanation
10. Investment real estate
(1)Investment real estate measured at cost
√Applicable □ Not-applicable
In RMB
Item Houses, buildings Land Use Right Construction in process Total
I. Original book value
1.Opening balance 5,051,773.92 5,051,773.92
2.Current increased
(1)Outsourcing
(2)Transfer-in from
inventory/fixed
assets/construction in
process
(3) Increased by
enterprise combination
3.Current decreased 5,051,773.92 5,051,773.92
(1) Disposal 5,051,773.92 5,051,773.92
(2) Other
transfer-out
4.Ending balance
II. Accumulated
depreciation and
accumulated
amortization
1.Opening balance 815,427.58 815,427.58
2.Current increased 69,256.00 69,256.00
(1) Provision or
69,256.00 69,256.00
amortization
3.Current decreased 884,683.58 884,683.58
(1) Disposal 884,683.58 884,683.58
(2) Other
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东沣科技集团股份有限公司 2018 年年度报告全文
transfer-out
4.Ending balance
III. Depreciation reserves
1.Opening balance
2.Current increased
(1) Accrual
3.Current decreased
(1) Disposal
(2) Other
transfer-out
4.Ending balance
IV. Book value
1.Ending book value
2.Opening book
4,236,346.34 4,236,346.34
value
(2)Investment real estate measured by fair value
□Applicable √ Not-applicable
The Company needs to comply with the disclosure requirement of Information Disclosure Guidelines of Shenzhen Stock Exchange
No.3-engaged in real estate business for the listed companies
Investment real estate measured by fair value disclosed by items:
In RMB
Fair value
Revenue Reasons for fair
Geographi Covered at Change of fair
Name of project rent-in in Ending fair value value changed and
c position area period-begi value
period report index
n
Whether the Company has new investment real estate measured by fair value in the period
□Yes √No
(3) Investment real estate without property rights certificate held
In RMB
Reasons for failure to handle the property
Item Book value
right certificate
146
东沣科技集团股份有限公司 2018 年年度报告全文
Other explanation
Decrease of the investment real estate in the period refers to the transfer-out from disposal of Nanjiang Trading
11. Fixed assets
In RMB
Item Ending balance Opening balance
Fixed assets 17,302,279.65 9,674,396.99
Total 17,302,279.65 9,674,396.99
(1)fixed assets
In RMB
Houses and Machinery Transportation
Item Other equipment Total
buildings equipment equipment
I. Original book
value:
1.Opening balance 5,259,168.09 2,220,348.20 5,204,758.70 1,393,816.06 14,078,091.05
2.Current
9,860,208.19 65,384.62 151,489.66 1,853,991.82 11,931,074.29
increased
(1) Purchase 8,203,689.11 65,384.62 151,489.66 1,844,661.82 10,265,225.21
(2) Transferred
from construction in
process
(3) Increased by
enterprise 9,330.00 9,330.00
combination
(4) Other transfer-in 1,656,519.08 1,656,519.08
3.Current
2,076,831.05 189,796.00 2,266,627.05
decreased
(1) Disposal or
1,784,350.35 5,200.00 1,789,550.35
scrap
(2) Other
292,480.70 184,596.00 477,076.70
transfer-out
4.Ending balance 13,042,545.23 2,285,732.82 5,356,248.36 3,058,011.88 23,742,538.29
II. Accumulated
depreciation
1.Opening balance 249,808.69 1,262,321.81 1,884,384.94 1,007,178.62 4,403,694.06
2.Current 1,187,270.83 101,736.04 600,669.65 378,084.09 2,267,760.61
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东沣科技集团股份有限公司 2018 年年度报告全文
increased
(1) Accrual 1,187,270.83 101,736.04 600,669.65 371,832.01 2,261,508.53
(2) Increased by
enterprise 6,252.08 6,252.08
combination
3.Current
38,411.97 3,248.04 189,536.02 231,196.03
decreased
(1) Disposal or
38,411.97 3,248.04 4,940.02 46,600.03
scrap
(2) Other
184,596.00 184,596.00
transfer-out
4.Ending balance 1,398,667.55 1,365,589.69 2,482,839.71 1,193,161.69 6,440,258.64
III. Depreciation
reserves
1.Opening balance
2.Current
increased
(1) Accrual
3.Current
decreased
(1) Disposal or
scrap
4.Ending balance
IV. Book value
1.Ending book
11,643,877.68 920,143.13 2,873,408.65 1,864,850.19 17,302,279.65
value
2.Opening book
5,009,359.40 958,026.39 3,320,373.76 386,637.44 9,674,396.99
value
(2)Temporarily idle fixed assets
In RMB
Cumulative Depreciation
Item Original book value Book value Note
depreciation reserves
148
东沣科技集团股份有限公司 2018 年年度报告全文
(3)Fixed assets acquired by financing lease
In RMB
Item Original book value Cumulative depreciation Depreciation reserves Book value
(4)Fixed assets acquired by operating lease
In RMB
Item Ending book value
(5)Fixed assets without property certificates
In RMB
Reasons for failure to handle the property
Item Book value
right certificate
Other explanation
(6) Disposal of fixed assets
In RMB
Item Ending balance Opening balance
Other explanation
12. Construction in process
In RMB
Item Ending balance Opening balance
Construction in process 101,650,833.16 2,267,164.04
Total 101,650,833.16 2,267,164.04
(1)Construction in process
In RMB
Ending balance Opening balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserves reserves
Industrialization
of equipment of
101,650,833.16 101,650,833.16 2,267,164.04 2,267,164.04
the Dongfeng
New Energy
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东沣科技集团股份有限公司 2018 年年度报告全文
Total 101,650,833.16 101,650,833.16 2,267,164.04 2,267,164.04
(2)Changes of major projects under construction
In RMB
Includin
Cumulati
Proporti g:
Fixed ve Interest
on of amount
assets Other amount capitaliz
Name of Opening Current Ending project of Source
Budget transfer-i decrease Progress of ation rate
project balance increased balance investme interest of funds
n in the in Period interest of the
nt in capitaliz
Period capitaliz year (%)
budget ation in
ed
Period
Industria
lization
of
equipme 380,000, 2,267,16 99,383,6 101,650, 2,271,23 2,271,23
87.00% 87.00% 100.00% Other
nt of the 000.00 4.04 69.12 833.16 3.65 3.65
Dongfen
g New
Energy
380,000, 2,267,16 99,383,6 101,650, 2,271,23 2,271,23
Total -- -- 100.00% --
000.00 4.04 69.12 833.16 3.65 3.65
(3)provision for impairment of construction in process in the period
In RMB
Item Accrual in the period Accrual reasons
Other explanation
(4) Engineering material
In RMB
Ending balance Opening balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserves reserves
Other explanation :
150
东沣科技集团股份有限公司 2018 年年度报告全文
13. Productive biological asset
(1)Productive biological assetmeasured by cost
√Applicable □ Not-applicable
In RMB
Item Plantation Livestock Forestry Aquaculture Total
I. Original book
value
1.Opening balance 40,121.80 40,121.80
2.Current
218,050.20 218,050.20
increased
(1)Outsourcing 183,000.00 183,000.00
(2)
35,050.20 35,050.20
Self-cultivation
3.Current
57,172.00 57,172.00
decreased
(1) Disposal 57,172.00 57,172.00
(2)Other
4.Ending balance 201,000.00 201,000.00
II. Accumulated
depreciation
1.Opening balance 22,150.41 22,150.41
2.Current
78,469.81 78,469.81
increased
(1) Accrual 78,469.81 78,469.81
3.Current
21,057.72 21,057.72
decreased
(1) Disposal 21,057.72 21,057.72
(2)Other
4.Ending balance 79,562.50 79,562.50
III. Depreciation
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东沣科技集团股份有限公司 2018 年年度报告全文
reserves
1.Opening balance
2.Current
increased
(1) Accrual
3.Current
decreased
(1) Disposal
(2)Other
4.Ending balance
IV. Book value
1.Ending book
121,437.50 121,437.50
value
2.Opening book
17,971.39 17,971.39
value
(2)Productive biological asset measured by fair value
□Applicable √ Not-applicable
14. Intangible assets
(1)Intangible assets
In RMB
Non-patent
Item Land Use Right Patent right Total
technology
I. Original book
value
1.Opening
52,406,400.00 52,406,400.00
balance
2.Current
6,951,748.89 6,951,748.89
increased
(1) Purchase 6,951,748.89 6,951,748.89
(2) Internal
R&D
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东沣科技集团股份有限公司 2018 年年度报告全文
(3) Increased
by enterprise
combination
3.Current
decreased
(1) Disposal
4.Ending
59,358,148.89 59,358,148.89
balance
II. Accumulated
amortization
1.Opening
701,088.96 701,088.96
balance
2.Current
1,970,099.34 1,970,099.34
increased
(1) Accrual 1,970,099.34 1,970,099.34
3.Current
decreased
(1) Disposal
4.Ending
2,671,188.30 2,671,188.30
balance
III. Depreciation
reserves
1.Opening
balance
2.Current
increased
(1) Accrual
3.Current
decreased
(1) Disposal
4.Ending
153
东沣科技集团股份有限公司 2018 年年度报告全文
balance
IV. Book value
1.Ending book
56,686,960.59 56,686,960.59
value
2.Opening book
51,705,311.04 51,705,311.04
value
Ratio of the intangible assets resulted by internal R&D in balance of the intangible assets at period
(2) Failure to handle the property right certificate
In RMB
Reasons for failure to handle the property
Item Book value
right certificate
Other explanation :
15. Expense on Research and Development
In RMB
Opening Ending
Item Current increased Current decreased
balance balance
Airship 2,543,414.10 881,531.28 3,424,945.38
Air-cooled
hydrogen fuel
cell power 31,847.46 3,333,663.53 269,385.86 3,096,125.13
system for
vehicle used
ZS01
938,300.00 4,547,118.05 645,862.23 4,839,555.82
alumina fiber
Real-time
hydrogen
5,819,388.91 408,659.39 5,410,729.52
production
equipment
14,581,701.7 13,346,410.4
Total 3,513,561.56 4,748,852.86
7 7
Other explanation
The capitalization start point of air-cooled hydrogen fuel cell power system for vehicle used was September 26, 2017, the project has
a total of four stages, by the end of the period, the research and development phase has been completed to the third stage; the
capitalization start point of real-time hydrogenation equipment was September 26, 2017, the project has a total of four stages, as of
the end of the period, the research and development phase has been completed to the third stage; the capitalization start point of ZS01
alumina fiber was September 26, 2017, the project has a total of three stages, as of the end of the period, the research and
development phase has been completed to the third stage, and the specific basis for its capitalization include: 1. The intangible assets
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东沣科技集团股份有限公司 2018 年年度报告全文
have been completed to enable them to be used or sold and technically possess feasibility; 2. The intangible assets have been
completed to enable them to be used or sold and technically possess feasibility; 3. The way in which intangible assets generate
economic benefits, including the proof that the products produced by using the intangible assets have markets or the intangible assets
have markets themselves; if intangible assets are to be used internally, it should prove its usefulness; 4. There are enough technical
and financial resources and other resources to support to complete the development of the intangible assets, and have ability to use or
sell the intangible assets; 5. The expenditure attributable to the development phase of the intangible assets can be reliably measured.
16. Goodwill
(1)Original book value of goodwill
In RMB
Name of invested
company or items Opening balance Current increased Current decreased Ending balance
formed goodwill
Aolin New
1,294,711.56 1,294,711.56
Materials
Haizhuo Energy 249,074.85 249,074.85
Total 1,294,711.56 249,074.85 1,543,786.41
(2)Depreciation reserves of goodwill
In RMB
Name of invested
company or items Opening balance Current increased Current decreased Ending balance
formed goodwill
Assets group with the goodwill involved or portfolio information
Aolin New Materials, the subsidiary operates as an independent economic entity after the merger, and the cash inflow generated by it
is basically independent of other assets or asset groups, so it is regarded as an asset group during the impairment test, and the
carrying amount (including goodwill) is 22,976,448.90 Yuan and the asset group or asset group combination is consistent with the
asset group or asset group combination determined on the date of purchase.
Haizhuo Energy, the subsidiary operates as an independent economic entity after the merger, and the cash inflow generated by it is
basically independent of other assets or asset groups, so it is regarded as an asset group during the impairment test, and the carrying
amount (including goodwill) is 24,868,222.86 Yuan and the asset group or asset group combination is consistent with the asset group
or asset group combination determined on the date of purchase.
Instructions for goodwill impairments test process and key parameters (such as the forecast period growth rate, stable period growth
rate, profit rate, discount rate, and forecast period when estimating the present value of the future cash flow), and the method of
confirming the impairment loss of goodwill:
The company conducted impairment test for the asset group related to goodwill at the end of the period, when conducting the
155
东沣科技集团股份有限公司 2018 年年度报告全文
impairment test, the book value of goodwill was apportioned to the asset group or asset group combination expected to benefit from
the synergy of business combination, and then compared the book value of the asset group with the recoverable amount so as to
determine whether the asset group (including goodwill) had been impaired. The test results showed that the recoverable amount of
the asset group including the apportioned goodwill was lower than the book value, and the corresponding impairment loss was
confirmed.
The specific test process was as follows:
The recoverable amount of the asset group was a five-year forecast prepared by the company’s management based on the future
development trend and business plan, which was calculated by using the future cash flow to convert into the present value. After
testing, the recoverable amount of Aolin New Materials was 35,341,494.01 Yuan, which was greater than the book value (including
goodwill) of 22,976,448.90 Yuan, and the recoverable amount of Haizhuo Energy was 34,721,467.79 Yuan, which was greater than
the book value (including goodwill) of 24,868,222.86 Yuan. Asset groups including goodwill predicted by the management were not
impaired and no impairment provision was required.
Impact of goodwill impairment test
Other explanation
The goodwill formed due to the consideration paid by Haizhuo Energy for the capital increase and share expansion in current period
being higher than the share of the book value of the net assets on the purchase date had no indication of impairment as the formation
time of goodwill was relatively short.
The appreciation in the goodwill which formed due to the consideration paid by Aolin New Materials for the capital increase and
share expansion on December 29, 2017 being higher than the share of the book value of the net assets of Aolin New Materials on the
purchase date was mainly fixed assets and development expenditure, the recoverable amount of the fixed assets of 649,584.80 yuan
was higher than the book value of 348,638.70 yuan, the development expenditure has been patented in 2018 and obtained the patent
certificate, the recoverable amount of both was higher than the book value, so there was no indication of impairment.
17. Long-term expenses to be apportioned
In RMB
Amortized in current
Item Opening balance Current increased Other decrease Ending balance
period
Office remodeling
149,963.84 129,408.36 20,555.48
costs
Fire protection
70,000.00 60,000.00 10,000.00
engineering
Plant decoration 154,847.48 13,786.17 141,061.31
Floor pain
engineering of the 99,496.91 4,229.14 95,267.77
plant in Eco-Park
Total 219,963.84 254,344.39 207,423.67 266,884.56
Other explanation
156
东沣科技集团股份有限公司 2018 年年度报告全文
18. Deferred income tax assets and deferred income tax liabilities
(1)Deferred income tax assets without offset
In RMB
Ending balance Opening balance
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Preparations of assets
3,102,581.64 775,645.41
depreciation
Total 3,102,581.64 775,645.41
(2)Deferred income tax liabilities without offset
In RMB
Ending balance Opening balance
Item Taxable temporary Deferred income tax Taxable temporary Deferred income tax
differences liabilities differences liabilities
(3)Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB
Ending balance of Trade-off between the Opening balance of
Trade-off between the
deferred income tax deferred income tax deferred income tax
Item deferred income tax
assets or liabilities after assets and liabilities at assets or liabilities after
assets and liabilities
off-set period-begin off-set
Deferred income tax
775,645.41
assets
(4)Details of unrecognized deferred income tax assets
In RMB
Item Ending balance Opening balance
Deductible temporary difference 25,599,989.61 22,049,335.17
Deductible losses 144,594,924.49 135,919,643.05
Total 170,194,914.10 157,968,978.22
(5)Deductible losses of un-recognized deferred income tax assets expired on the followed year
In RMB
157
东沣科技集团股份有限公司 2018 年年度报告全文
Year Period-end Period-begin Note
2019 30,576,125.82 30,576,125.82 2014
2020 33,429,382.84 33,429,382.84 2015
2021 19,481,015.78 19,481,015.78 2016
2022 52,327,940.32 52,433,118.61 2017
2023 8,780,459.73 2018
Total 144,594,924.49 135,919,643.05 --
Other explanation :
19. Other non-current assets
In RMB
Item Ending balance Opening balance
Engineering amount paid in advance 120,392,369.00
Account paid in advance for lands 10,427,021.55
Equipment amount paid in advance 1,350,783.36
Total 121,743,152.36 10,427,021.55
Other explanation :
20. Note payable and account payable
In RMB
Item Ending balance Opening balance
Account payable 6,668,789.67 15,487,833.06
Total 6,668,789.67 15,487,833.06
(1)Category of note payable
In RMB
Category Ending balance Opening balance
Total due note payable without payment at end of the period was Yuan
(2)Account payable
In RMB
Item Ending balance Opening balance
Account payable for materials 33,996.00
Account payable for engineering 6,596,413.67 15,406,565.98
158
东沣科技集团股份有限公司 2018 年年度报告全文
Account payable for goods 7,994.50
Account payable for equipment 20,200.00 8,700.00
Other 18,180.00 64,572.58
Total 6,668,789.67 15,487,833.06
(3) Important account payable with over one year account age
In RMB
Item Ending balance Reasons for non-repayment or carry-over
Chengde County Xingcheng Construction
1,474,499.03 Engineering amount
& Installation Company
Chengde Great Wall Construction Group
1,353,100.46 Engineering amount
Co., Ltd.
Chengde Licheng Construction &
1,276,900.24 Engineering amount
Installation Engineering Co., Ltd.
Chengde Yongwang Construction
867,887.22 Engineering amount
Engineering Co., Ltd.
Handan Hanyi Construction Engineering
400,000.00 Engineering amount
Co., Ltd.
Total 5,372,386.95 --
Other explanation :
21. Accounts received in advance
(1)Accounts received in advance
In RMB
Item Ending balance Opening balance
Account received in advance for
14,427,450.03 62,427,764.58
property-Huijing Tiandi
Account received in advance for goods 64,400.00
Resident heating fees received in advance 1,561,464.19 1,530,016.02
Other 216,005.77 207,928.77
Total 16,269,319.99 64,165,709.37
(2)Major account received in advance for over one year age
In RMB
Item Ending balance Reasons for non-repayment or carry-over
159
东沣科技集团股份有限公司 2018 年年度报告全文
(3)Project closed for account without complete in construction from construction contract at period-end
In RMB
Item Amount
Other explanation :
The Company needs to comply with the disclosure requirement of Information Disclosure Guidelines of Shenzhen Stock Exchange
No.3-engaged in real estate business for the listed companies
Top 5 accounts received in advance:
In RMB
Estimated Ratio for sales in
Serial Name of project Opening balance Ending balance
completion time advance
1 Huijing Tiandi 62,427,764.58 14,427,450.03 31 Dec. 2016 95.89%
22. Wage payable
(1)Wage payable
In RMB
Item Opening balance Current increased Current decreased Ending balance
I. Short-term employee
2,177,237.35 19,230,912.96 20,456,998.72 951,151.59
benefits
II. Post-employment
benefits - defined 24,431.58 1,738,973.07 1,733,466.65 29,938.00
contribution plans
III. Dismission welfare 350,910.00 350,910.00
Total 2,201,668.93 21,320,796.03 22,541,375.37 981,089.59
(2)Short-term employee benefits
In RMB
Item Opening balance Current increased Current decreased Ending balance
1. Salary, bonus,
2,159,954.12 16,584,879.67 17,820,532.20 924,301.59
allowance and subsidy
2. Employee welfare 1,048,726.37 1,048,726.37
3. Social insurance 16,390.01 800,082.26 799,002.27 17,470.00
Including: medical
14,341.26 660,767.95 659,634.21 15,475.00
insurance expenses
Work 682.92 67,528.45 67,774.37 437.00
160
东沣科技集团股份有限公司 2018 年年度报告全文
injury insurance
expenses
Maternity
1,365.83 71,785.86 71,593.69 1,558.00
insurance
4. Housing provident
495.00 793,613.40 784,728.40 9,380.00
funds
5. Labor union
expenditures and
398.22 3,611.26 4,009.48
employee education
expenses
Total 2,177,237.35 19,230,912.96 20,456,998.72 951,151.59
(3)Defined contribution plans
In RMB
Item Opening balance Current increased Current decreased Ending balance
1.Basic endowment
23,646.10 1,694,363.43 1,688,889.53 29,120.00
insurance expenses
2.Unemployment
785.48 44,609.64 44,577.12 818.00
insurance expenses
Total 24,431.58 1,738,973.07 1,733,466.65 29,938.00
Other explanation :
23. Taxes payable
In RMB
Item Ending balance Opening balance
VAT 364,882.08 41,473.25
Enterprise income tax 12,906,984.10
Individual income tax 12,830.10 47,250.06
Urban maintenance and construction tax 20,216.47 432.35
Land appreciation tax 468,597.56
Land use tax 136,349.73
Educational surtax 12,129.88 354.44
Stamp tax 35,224.90 37,978.90
Local educational surtax 8,086.59 236.30
161
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Total 921,967.58 13,171,059.13
Other explanation :
24. Other account payable
In RMB
Item Ending balance Opening balance
Interest payable 193,333.41
Other account payable 118,376,885.44 25,952,193.34
Total 118,570,218.85 25,952,193.34
(1)Interest payable
In RMB
Item Ending balance Opening balance
Interest of the long-term loans which has
interest paid by installment and repayment 193,333.41
of principal at maturity
Total 193,333.41
Important interest overdue without payment:
In RMB
Borrower Amount overdue Overdue causes
Other explanation :
(2)Other account payable
1)Other account payable by nature
In RMB
Item Ending balance Opening balance
Deposit and margin 971,041.20 712,541.20
Agency fee 309,178.00 1,525,800.00
Intercourse current 19,580,486.66 22,953,440.32
Withhold and remit tax 10,679.28 22,061.90
Other 97,505,500.30 738,349.92
Total 118,376,885.44 25,952,193.34
2)Other account payablewith large amount and aging of over one year
In RMB
Item Ending balance Reasons for non-repayment or carry-over
162
东沣科技集团股份有限公司 2018 年年度报告全文
Other explanation
25. Long-term loans
(1)Category of long-term loans
In RMB
Item Ending balance Opening balance
Mortgage loan 101,710,000.00
Total 101,710,000.00
Explanation on category of long-term loans:
Other explanation, including the section of the rate:
As of December 31, 2018, the company’s long-term loan balance of Bank of Dongguan Co., Ltd. Songshan Lake Technology
Sub-branch was 1,017,100 millionYuan, and the loan was limited to the follow-up construction of the equipment industrialization
project of Dongfeng New Energy. Dongfeng Technology Group Co., Ltd., Dongguan Dongfeng Technology Development Co., Ltd.,
Dongguan Zhongchuang New Energy Technology Co., Ltd., Dongguan Aolin New Materials Co., Ltd., and Dongguan Haizhuo
Energy Technology Co., Ltd. guaranteed with the joint liability warranty; and the collaterals were the land use rights and
above-ground buildings of Yue ( 2017) Dongguan Real Property No. 0121786; the pledge was 100% equity of Dongguan Dongfeng
Intelligent Technology Co., Ltd. held by Dongguan Dongfeng Technology Development Co., Ltd.
26. Share capital
In RMB
Increased (decreased) in Period
Opening Shares
New shares Ending balance
balance Bonus shares converted from Other Sub-total
issued
public reserve
Total shares 706,320,000.00 706,320,000.00
Other explanation :
27. Capital public reserve
In RMB
Item Opening balance Current increased Current decreased Ending balance
Capital premium (share
397,808,090.32 397,808,090.32
premium)
Other capital reserves 65,873,219.23 65,873,219.23
Total 463,681,309.55 463,681,309.55
163
东沣科技集团股份有限公司 2018 年年度报告全文
Other explanation, including changed in Period as well as reasons for changes:
28. Treasury stock
In RMB
Item Opening balance Current increased Current decreased Ending balance
Equity repurchase 19,718,613.55 19,718,613.55
Total 19,718,613.55 19,718,613.55
Other explanation, including changed in Period as well as reasons for changes:
29. Surplus public reserve
In RMB
Item Opening balance Current increased Current decreased Ending balance
Statutory surplus
76,791,550.17 76,791,550.17
reserves
Total 76,791,550.17 76,791,550.17
Explanation on surplus reserve, including changed in Period as well as reasons for changes:
30. Retained profit
In RMB
Item Current period Last period
Retained profits at the end of last period before
-882,864,082.85 -886,966,408.74
adjustment
Retained profits at the beginning of the period
-882,864,082.85 -886,966,408.74
after adjustment
Add: The net profits belong to owners of patent
7,383,835.76 4,102,325.89
company of this period
Retained profits at the end of the period -875,480,247.09 -882,864,082.85
Details about adjusting the retained profits at the beginning of the year:
1) The retroactive adjustments to Accounting Standards for Business Enterprises and its relevant new regulations affect the
undistributed profits at the beginning of the year amounting to Yuan.
2) The changes in accounting policies affect the undistributed profits at the beginning of the year amounting to Yuan.
3) The major accounting error correction affects the undistributed profits at the beginning of the year amounting to Yuan.
4) Merge scope changes caused by the same control affect the undistributed profits at the beginning of the year amounting to Yuan.
5) Other adjustments affect the undistributed profits at the beginning of the year amounting to Yuan.
164
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31. Operating income and operating cost
In RMB
Current period Last period
Item
Income Cost Income Cost
Main business 123,462,309.48 108,747,731.24 248,704,998.16 236,724,015.73
Other business 45,774.42 1,366,864.91 459,123.94
Total 123,508,083.90 108,747,731.24 250,071,863.07 237,183,139.67
The Company needs to comply with the disclosure requirement of Information Disclosure Guidelines of Shenzhen Stock Exchange
No.3-engaged in real estate business for the listed companies
Top 5 account with revenue recognized in the period:
In RMB
Serial Name of project Revenue
1 Huijing TiandiItem 118,807,719.93
32. Tax and extras
In RMB
Item Current period Last period
Urban maintenance and construction tax 207,179.94 607,169.86
Educational surtax 129,234.81 364,301.93
Property tax 109,230.51 90,831.37
Business tax 547,780.45 9,120,014.46
Local educational surtax 77,945.15 242,867.96
Land appreciation tax -2,214,613.09 -1,865,748.43
Other 895,409.34 1,231,857.33
Total -247,832.89 9,791,294.48
Other explanation :
33. Sales expense
In RMB
Item Current period Last period
Repair charge 196,990.00
Salary 89,350.00
Advertising fees 1,200.00 148,130.00
Production costs 61,286.00
165
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Packaging fee 4,902.12 162,064.81
Agency fee 13,848,419.45
Other 19,894.59 200.00
Total 115,346.71 14,417,090.26
Other explanation :
34. Management expense
In RMB
Item Current period Last period
Remuneration 11,289,704.54 13,255,871.45
Agency fee 2,712,227.89 3,684,947.19
Business entertainment 4,503,880.70 4,067,254.25
Depreciation and amortization 3,993,026.12 2,160,421.40
Business-travel expense 1,299,616.63 1,615,666.00
Office allowance 723,349.13 928,976.58
Travelling expenses 47,218.03 199,479.05
Amortization of low value consumables 111,693.84 35,015.42
Long-term deferred expenses 41,682.82 153,935.87
Repair charge 415,429.92 245,340.37
Material consumption 390,272.71 354,911.66
Rental fee 5,700.00 201,720.00
Premium 129,447.86 117,794.81
Residual premium 8,746.67 169,852.55
Other 3,564,651.61 2,361,185.01
Total 29,236,648.47 29,552,371.61
Other explanation :
35. R&D expense
In RMB
Item Current period Last period
Staff salary 2,989,415.84 120,080.00
Cost of fuel and power 15,191.25
Material expenses 305,017.96 4,809.69
Depreciation expenses 131,417.67
166
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Other 1,307,810.14
Total 4,748,852.86 124,889.69
Other explanation :
36. Financial expense
In RMB
Item Current period Last period
Interest expense 1,617,172.91
Less: Interest income 175,090.92 645,550.99
Profit/loss on exchange -269,681.12 330,220.97
Bank handling charges 59,219.06 44,334.40
Total -385,552.98 1,346,177.29
Other explanation :
37. Asset impairment loss
In RMB
Item Current period Last period
I. Bad debt loss 108,706.75 367,061.18
II. Loss on inventory valuation -3,960.15
III. Impairment loss of financial assets
339,366.05 6,113,728.80
available for sale
Total 448,072.80 6,476,829.83
Other explanation :
38. Other income
In RMB
Sources of other income Current period Last period
Government grant 2,896,903.64
39. Investment income
In RMB
Item Current period Last period
Long-term equity investment income
-980,509.06
calculated on equity method
167
东沣科技集团股份有限公司 2018 年年度报告全文
Investment income from disposal of long-term
18,501,800.54
equity investment
Investment income from financial products in
1,144,246.03 2,482,382.07
the Year
Total 19,646,046.57 1,501,873.01
Other explanation :
40. Income from assets disposal
In RMB
Income from assets disposal Current period Last period
Gains/losses from biological assets
-18,684.68 -304,370.98
disposal
Gains/losses from intangible assets
17,692,850.63
disposal
Gains/losses from fixed assets disposal 4,544,930.26 47,671,503.99
Total 4,526,245.58 65,059,983.64
41. Non-operating revenue
In RMB
Amount reckoned into current
Item Current period Last period
non-recurring gains/losses
Other 3,125.00 24,633.24 3,125.00
Total 3,125.00 24,633.24
Government grants reckoned into current gains/losses:
In RMB
Impact on Assets-relate
Distributed current Special Current d
Item Reasons Nature Last Period
by gains/losses grants (Y/N) Period /income-relat
(Y/N) ed
Other explanation :
42. Non-operating expenditure
In RMB
Amount reckoned into current
Item Current period Last period
non-recurring gains/losses
Donating 384,980.00 700,000.00 384,980.00
168
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Total losses on disposal of
259.98 43,889.51 259.98
non-current assets
Penalty and fine 2,373.71 32,943.78 2,373.71
Compensation 30,000.00
Other 86,330.73 16,529.25 86,330.73
Total 473,944.42 823,362.54
Other explanation :
43. Income tax expense
(1) Statement of income tax expenses
In RMB
Item Current period Last period
Current income tax 110,309.68 12,906,984.10
Deferred income tax expenses 775,645.41
Total 885,955.09 12,906,984.10
(2)Adjustment on accounting profit and income tax expenses
In RMB
Item Current period
Total profit 7,443,194.06
Income tax measured by statutory/applicable tax rate 1,860,798.52
Impact on different tax rate for subsidiary -44,438.79
Impact from adjustment for previous period’s income tax 110,309.68
Impact of cost, expenses or losses unable to deductible 659,772.96
Impact on deductible losses for deferred income tax recognized
-4,756,971.25
at period-end before adjustment
The deductible temporary differences or deductible losses of the
3,056,483.97
un-recognized deferred income tax assets in the Period
Income tax expenses 885,955.09
Other explanation
44. Other comprehensive income
Found in Note
169
东沣科技集团股份有限公司 2018 年年度报告全文
45. Notes to statement of cash flow
(1) Other cash received in relation to operation activities
In RMB
Item Current period Last period
Interest income 175,090.92 645,550.99
Intercourse current 47,378,409.76 20,201,421.06
Subsidy income 2,896,000.00
Other 65,681,669.90 2,997,789.75
Total 116,131,170.58 23,844,761.80
Explanation on other cash received in relation to operation activities:
(2)Other cash paid in relation to operation activities
In RMB
Item Current period Last period
Disbursement costs 264,339.21 17,015,616.01
Donation costs 384,980.00 700,000.00
Intercourse current 163,483.99 20,683,332.74
Penalty and overdue fine 2,373.71 32,943.78
Other 38,401.80 3,374,469.10
Total 853,578.71 41,806,361.63
Explanation on other cash paid in relation to operation activities:
(3)Cash received from other investment activities
In RMB
Item Current period Last period
Explanation on cash received from other investment activities:
(4)Cash paid related with other investment activities
In RMB
Item Current period Last period
----- -----
Total ----
Explanation on cash paid related with other investment activities:
170
东沣科技集团股份有限公司 2018 年年度报告全文
(5)Cash received from other financing activities
In RMB
Item Current period Last period
Explanation on cash received from financing activities:
(6) Cash paid related with other financing activities
In RMB
Item Current period Last period
Change in restricted currency funds 698,492.97
Stock repurchase 19,718,613.55
Total 19,718,613.55 698,492.97
Explanation on cash paid related with otherfinancing activities:
46. Supplementary information to statement of cash flow
(1)Supplementary information to statement of cash flow
In RMB
Supplementary information Current Period Last Period
1. Net profit adjusted to cash flow of
-- --
operation activities:
Net profit 6,557,238.97 4,036,213.49
Add: Preparations of assets depreciation 448,072.80 6,476,829.83
Depreciation of fixed assets, consumption of
oil assets and depreciation of productive 2,261,508.53 1,751,789.36
biology assets
Amortization of intangible assets 1,970,099.34 747,346.80
Amortization of long-term deferred expenses 207,423.67 153,935.87
Loss from disposal of fixed assets, intangible
assets and other long-term assets(gain is -4,526,245.58 -66,313,983.64
listed with ―-‖)
Loss of fixed assets scrapping (gain is listed
259.98 43,889.51
with ―-‖)
Financial expenses (gain is listed with ―-‖) -----
Investment losses(gain is listed with ―-‖) -19,646,046.57 -1,501,873.01
Decrease of deferred income tax assets(gain
775,645.41
is listed with ―-‖)
171
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Decrease of inventory (gain is listed with
83,068,268.34 107,315,235.57
―-‖)
Decrease of operating receivable accounts
-58,983,097.43 6,341,395.52
(gain is listed with ―-‖)
Increase of operating payable accounts (loss
22,432,921.85 -143,602,353.58
is listed with ―-‖)
Net cash flow arising from operating
34,566,049.31 -84,551,574.28
activities
2. Material investment and financing not
-- --
involved in cash flow
3. Net change of cash and cash equivalents: -- --
Balance of cash at period end 33,512,916.99 68,107,388.69
Less: Balance of cash equivalent at
68,107,388.69 126,970,834.83
year-begin
Net increase of cash and cash equivalents -34,594,471.70 -58,863,446.14
(2) Net cash payment for the acquisition of a subsidiary of the current period
In RMB
Amount
Including: --
Including: --
Including: --
Other explanation :
(3)Net cash received from the disposal of subsidiaries
In RMB
Amount
Including: --
Including: --
Including: --
Other explanation :
(4)Constitution of cash and cash equivalent
In RMB
Item Ending balance Opening balance
172
东沣科技集团股份有限公司 2018 年年度报告全文
Ⅰ. Cash 33,512,916.99 68,107,388.69
Including: Cash in stock 368,614.69 61,945.60
Bank deposit available for payment at
33,144,302.30 68,045,443.09
any time
Ⅲ. Balance of cash and cash equivalent at
33,512,916.99 68,107,388.69
period-end
Other explanation :
Balance of cash and cash equivalent dated 31 December 2018 amounted as 33,512,916.99 Yuan, monetary fund has 36,306,825.10
Yuan at end of the period, which has 2,793,908.11 Yuan in difference, mainly because among the ending balance of monetary fund,
there is a margin of housing mortgage that can not be free in three months, and same as the year for 2017
47. Notes on items of changes of owner’s equity
Name and adjusted amount on ―Other‖ at balance of year-end of last year:
48. Assets with ownership or right-to-use restricted
In RMB
Item Ending book value Reasons of restricted
Monetary fund 2,793,908.11 Margin of housing mortgage
Total 2,793,908.11 --
Other explanation :
49. Foreign currency monetary items
(1) Foreign currency monetary
In RMB
Balance of foreign currency at
Item Converted exchange rate RMB concert at Period-end
period-end
Monetary fund -- --
Including: USD 819,740.92 6.8632 5,626,045.88
Euro
HKD 23,006,375.77 0.8762 20,158,186.45
Account receivable -- --
Including: USD
Euro
173
东沣科技集团股份有限公司 2018 年年度报告全文
HKD
Long-term loans -- --
Including: USD
Euro
HKD
Other explanation :
(2) Explanation on foreign operational entity, as for major foreign operational entity, disclosed foreign
main operation land, book-keeping currency and basis; and disclosed reasons if the book-keeping currency
changed
□Applicable √ Not-applicable
50. Government grants
(1) Government grants
In RMB
Amount reckoned into current
Category Amount Item listed
gain/loss
Subsidy for demonstration of Subsidy for demonstration of
2,890,000.00 2,890,000.00
the renewable energy building the renewable energy building
Subsidy from entrepreneurship Subsidy from entrepreneurship
6,000.00 6,000.00
drives employment drives employment
VAT reduction 903.64 VAT reduction 903.64
Total 2,896,903.64 2,896,903.64
(2) Government grants refund
□Applicable √ Not-applicable
Other explanation :
174
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51. Other
VIII. Changes of consolidation range
1. Enterprise combined not under the same control
(1)Enterprise combined not under the same control in the period
In RMB
Revenue of Net profit of
the purchaser the purchaser
Time for Cost for Ratio of Basis of the
The Way to Purchasing from from
equity equity equity purchasing
purchaser obtained date purchasing purchasing
obtained obtained obtained date
date to date to
period-end period-end
Enterprise
Haizhuo 6 March 15,956,000.0 combined not
62.00% 2018-3-6 0.00 -465,527.38
Energy 2018 0 under the *1
same control
*1 The investment agreement has been approved by the Board and completed the changes in industry and commerce. The equity
investment amount has paid in full, the financial and operation policy of the combined party has been control
Other explanation :
Haizhuo Energy established on 15 September 2015 with registered capital of 25 million Yuan.Registered capital comes to 25 million
Yuan from 9.5 million Yuan.Dongguan Hangda Venture Investment Co., ltd. and Dongfeng Technology Development entered into an
equity transfer agreement, that is increasing capital of 15.956 million Yuan to Haizhuo Energy from Dongguan Technology,
including registered capital of 15.5 million Yuan and 456000 Yuan reckoned into the capital reserves of Haizhuo Energy. On 6
March 2018, Dongguan Dongfeng Technology invested 15.5 million Yuan, a 62% in total registered capital.
(2)Combined cost and goodwill
In RMB
Combined cost Haizhuo Energy
--Cash 15,956,000.00
Total combined costs 15,956,000.00
Less: ratio of the recognizable fair value of the net assets
15,500,000.00
obtained
Amount of the goodwill/combined cost less than the 456,000.00
175
东沣科技集团股份有限公司 2018 年年度报告全文
recognizable fair value of the net assets
Explanation on determination method for fair value of combine cost, contingent consideration and its changes:
Reason of major goodwill resulted:
Other explanation :
(4) The purchaser's identifiable assets and liabilities on purchasing date
In RMB
Fair value on purchasing date Book value on purchasing date
Net assets 25,333,750.24 25,338,723.00
Less: Minority interests 9,626,825.09 9,628,714.74
Net assets acquired 15,706,925.15 15,710,008.26
Determination method for fair value of the identifiable assets and liabilities:
Contingent liability of the purchaser taken during enterprise merger:
Other explanation :
(4) Gains/losses arising from re-calculation on fair value for the equity held before purchasing date
Whether the enterprise combine through multiple transaction by steps or not and obtained controlling rights during the reporting
period
□Y √N
(5)Explanation on the combination consideration, which is unable to confirm rationally on purchasing date
or combination date or on the fair value of identifiable assets and liabilities for the purchaser
(6)Other explanation
2.Enterprise combined under the same control
(1)Enterprise combined under the same control in the period
In RMB
Revenue of Net profit of
the combined the combined Revenue of Net profit of
Basis for
Equity ratio Basis of party from party from the combined the combined
Combined merger under Combination
in combination period of period of party during party during
party the same date
combination date combined to combined to comparative comparative
control
combination combination period period
date date
176
东沣科技集团股份有限公司 2018 年年度报告全文
Dongfeng
100.00% 7 April 2016 0.00 0.00 0.00 0.00
Power
Other explanation :
Gist of transaction constituting the business merger under the same control and instructions for the basis of determination on the
merger date
Dongfeng Power was invested and established by Tibet Dongfeng Investment Co., Ltd. on April 7, 2016, and its ultimate owner was
Mr. Wang Dong who is the company’s largest shareholder.
(2)Combine cost
In RMB
Combine cost
Explanation on contingent consideration and its changes:
Other explanation :
Dongfeng Power was established on April 7, 2016 with a registered capital of RMB 70 million. On August 28, 2018, Dongguan
Dongfeng Technology Development and Tibet Dongfeng Investment Co., Ltd. signed an equity transfer agreement to transfer 100%
equity at RMB 0.00. On December 25, 2018, Dongguan Dongfeng Technology Development signed a shareholder transfer agreement
with the Company to assign 100% equity at RMB0.00.
(3)Book value of the combined party's assets and liabilities on combine date
In RMB
Combination date End of last period
Other account payable 500.00 500.00
Net assets -500.00 -500.00
Net assets acquired -500.00 -500.00
Contingent liability of the combined party taken in combination:
Other explanation :
3. Subsidiary disposal
Whether there is a single disposal of the investment in subsidiaries that is the loss of control
√ Yes □No
In RMB
Basis for The Proporti Book Fair Gain/los The The
Ratio of Disposal The time
Price of determin differenc on of value of value of s of the method amount
Subsidia the method when
equity ing the e residual the the residual and main of other
ry equity for controlli
disposed time between equity on residual residual equity hypothes compreh
disposed equity ng right
when the the date equity equity re-measu is of ensive
177
东沣科技集团股份有限公司 2018 年年度报告全文
lose controlli disposal when on the on the red by determin income
ng right price and controlli date date fair ing the transferr
lose the net ng right when when value fair ed into
assets lose controlli controlli value of investme
share of ng right ng right residual nt
the lose lose equity on gain/loss
subsidiar the date related to
y at the when equity
level of controlli investme
consolid ng right nt of
ated lose original
financial subsidiar
statemen ies
ts
correspo
nding to
the
disposal
investme
nt
30 Controlli
Nanjiang 22,639,5 18,328,0
100.00% On sale August ng rights 0.00% 0.00 0.00 0.00 - 0.00
Trading 00.00 70.03
2018 transfer
Other explanation :
The Company transferred its 100% stake in Chengde NanjiangTrading Co., Ltd. to Chengde Chengjin Commercial and Trading Co.,
Ltd. on August 14, 2018, therefore, Chengde Nanjiang Trading Co., Ltd. was no longer included in the consolidation scope of the
balance sheet in current period. However, the Accounting Standards for Business Enterprises No. 33 – Consolidated Financial
Statements stipulates that if a parent company disposes of a subsidiary during the reporting period, the income, expenses and profits
of the subsidiary from the beginning of the period to the disposal date should be included in the consolidated income statement, and
the cash flows of the subsidiary from the beginning of the period to the disposal date should be included in the consolidated cash
flow statement. Therefore, the income, expenses and profits of Chengde Nanjiang Trading Co., Ltd. from the beginning of the current
period to the date of cancellation were still included in the scope of consolidation.
Whether there is disposal of the investment in subsidiaries through multiple transactions step by step and loss of control in the current
period
□ Yes √ No
178
东沣科技集团股份有限公司 2018 年年度报告全文
4. Other reasons for consolidation range changed
Reasons for changed on consolidation range (such as new subsidiary established, subsidiary liquidated
etc.)And relevant information: 5. Other
IX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Main operation Share-holding ratio
Subsidiary Registered place Business nature Acquired way
place Directly Indirectly
Management and
Kefeng consultant of
Chengde Chengde 100.00% Establishment
Engineering engineering
project
Dongfeng Industrial
Chengde Chengde 100.00% Establishment
Investment investment
International
Nanjiang Asia Chengde Chengde 100.00% Establishment
investment
Kefeng Trading Chengde Chengde Commercial trade 100.00% Establishment
Hangzhou High-tech
Hangzhou Hangzhou 100.00% Establishment
Dongfeng development
Dongguan Technology
Dongfeng Dongguan Dongguan Development of 100.00% Establishment
Technology new materials
Technology
Kefeng Development of
Chengde Chengde 100.00% Establishment
Aerospace aerospace
products
Technology Enterprise
Dongfeng Power Dongguan Dongguan Development of 100.00% combined under
clean energy the same control
Ecological Animal
Chengde Chengde 100.00% Establishment
Agriculture husbandry
Inflatable
Nanjiang capsule,
Chengde Chengde 100.00% Establishment
Technology production and
sale of Grapheme
Huijing Property Chengde Chengde Property 100.00% Establishment
179
东沣科技集团股份有限公司 2018 年年度报告全文
management
Enterprise
Technology
Zhongchuang combined not
Dongguan Dongguan Development of 60.98%
New Energy under the same
new energy
control
Technology
Dongguan Enterprise
Development in
Dongfeng Dongguan Dongguan 100.00% combined under
field of
Intelligent the same control
technology
Enterprise
Nano metric
Aolin New combined not
Dongguan Dongguan technology 62.00%
Materials under the same
material
control
Enterprise
Technology
combined not
Haizhuo Energy Dongguan Dongguan Development of 62.00%
under the same
new materials
control
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
Basis for controlling the invested entity with half or below voting rights held and without controlling invested entity but with over
half and over voting rights:
Controlling basis for the structuring entity included in consolidated range:
Basis on determining to be an agent or consignor:
Other explanation :
*1Nanjiang Investment was established by Nanjiang Real Estate dated 9 October 2012, original registered capital was 50 million
Yuan, shareholder Nanjiang Real Estate contribute 50 million Yuan, presenting 100 percent of the registered capital; on 21 December
2012, the 100 percent equity held by Nanjiang Real Estate are transferred to Nanjiang Company with 50 million Yuan, after
transferred, Dongfeng Sci-Tech Group holds total equity of the Nanjiang Investment; on 6 January 2013, Dongfeng Sci-Tech Group
increase capital 40 million Yuan to Nanjiang Investment, and registered capital comes to 90 million Yuan after capital increased.
*2 Ecological Agriculture was established by Nanjiang Investment on 24 October 2012, original registered capital was 5 million
Yuan, shareholder Nanjiang Investment contributes 5 million Yuan with 100 percent held in total registered capital. On 18 April
2013, Nanjiang Investment increase 5 million Yuan to Ecological Agriculture and the registered capital turns to 10 million Yuan after
increased.
*3Nanjiang Asia was founded by Dongfeng Sci-Tech Group on 14th Nov. 2013, located in Hong Kong, with register capital of
US$ 20 million, the paid-up was US$ 797, 583.34.
*4Nanjiang Technologywas founded jointly by Nanjiang Investment and Ningbo Morsh Technology on 24 th Jan. 2013 with register
capital of 50 million Yuan, including Nanjiang Investment invested 45 million Yuan taking up 90% of the total investment; Ningbo
Morsh Technology invested 5 million Yuan taking up 10%.
*5 Huijing Property was founded by Nanjiang Investment on 18th Nov. 2013 with register capital of 500,000 Yuan. Shareholder
Nanjiang Investment invested 500, 000 Yuan wholly owning it.
180
东沣科技集团股份有限公司 2018 年年度报告全文
*6Dongfeng Power was established by Tibet Dongfeng Investment Co., Ltd. on April 7, 2016 with a registered capital of RMB 70
million and an actual capital contribution of RMB 0. On August 28, 2018, it signed an equity transfer agreement with Dongguan
Dongfeng Technology to transfer the 100% equity to Dongguan Dongfeng Technology at 0 yuan. On December 25, 2018, Dongguan
Dongfeng Technology transferred its 100% equity to the Company at 0.00 yuan. As of December 31, 2018, it has not actually
invested.
*7 Hangzhou Dongfeng established on 21 September 2016 by Dongfeng Sci-Tech Group, registered capital was 50 million Yuan;
actually paid-in capital was 30 million Yuan.
*8Kefeng Aerospace established on 12 December 2016 by Dongfeng Sci-Tech Group, registered capital was 30 million Yuan, no
funds actually paid-up ended as 31st December 2018.
*9 Kefeng Engineering and Kefeng Trading are the new enterprise derivative split from Dongfen Trade and Business on 6 March
2017, registered capital amounted as 0.5 million Yuan and 8.5 million Yuan respectively. Totally 100% of the registered capital are
taken by Dongfeng Sci-Tech Group.
*10 DongguanDongfengTechnology established on 17 August 2017 with registered capital of 100 million Yuan. Dongfeng Sci-Tech
Group invested 100 million Yuan on 20 September 2017, a 100% of the registered capital takes.
*11Zhongchuang New Energy established on 4 July 2017 with registered capital of 24.6 million Yuan. On 5 September 2017, the
Dongguang Dongfeng Technology Development entered into a capital increase agreement with Dongguang Hangda Venture
Investment, registered capital goes to 24.6 million Yuan from one million Yuan. Among them, Dongguang Dongfeng Technology
Development contributes 15 million Yuan in monetary, a 60.98% in total shares. Dongguang Dongfeng Technology contributed 15
million Yuan on 24 October 2017
*12Dongguan Dongfeng Intelligent established on 14 February 2017 with registered capital of 60 million Yuan. On 5 December 2017,
Dongfeng Technology Development entered into an equity transfer agreement with Dongguan Dongfeng New Energy with
consideration of 15 million Yuan. Registered capital of 45 million are paid on 27 December 2017 with totally 100% holds in shares
*13 Aolin New Material established on 23 October 2015 with registered capital of 25 million Yuan. On 4 December 2017, Aolin
entered into a capital increase agreement with Dongguang Dongfeng Technology, registered capital comes to 25 million Yuan from
9.5 million Yuan. In line with the agreement between Dongguang Hangda Venture Investment Co., ltd. and Dongfeng Technology
Development, increasing capital of 16.4025 million Yuan to Aolin New Material, among which, 15.5 million Yuan will increased for
registered capital, the 902,500 Yuan will reckoned into the capital reserves of Aolin New Material. On 29 December 2017,
Dongguang Dongfeng Technology invested 15.5 million Yuan, a 62% in total registered capital.
*14Haizhuo Energy established on 15 September 2015 with registered capital of 25 million Yuan. On 28 December 2017, Haizhuo
Energy entered into a capital increase agreement with Dongguan Dongfeng Technology, registered capital comes to 25 million Yuan
from 9.5 million Yuan. In line with the agreement between Dongguan Hangda Venture Investment Co., ltd. and Dongfeng
Technology Development, increasing capital of 15.956 million Yuan to Haizhuo Energy, among which, 15.5 million Yuan will
increased for registered capital, the 456,000 Yuan will reckoned into the capital reserves of Haizhuo Energy. On 6 March 2018,
Dongguan Dongfeng Technology invested 15.5 million Yuan, a 62% in total registered capital.
181
东沣科技集团股份有限公司 2018 年年度报告全文
(2)Important non-wholly-owned subsidiary
In RMB
Dividend announced to
Share-holding ratio of Gains/losses attributable Ending equity of
Subsidiary distribute for minority in
minority to minority in the Period minority
the Period
Zhongchuang New
39.02% -121,134.70 0.00 9,474,457.38
Energy
Aolin New Materials 38.00% -528,561.69 8,731,050.58
Haizhuo Energy 38.00% -176,900.40 9,449,924.69
Explanation on share-holding ratio of minority different from ratio of voting right:
Other explanation :
(3)Main finance of the important non-wholly-owned subsidiary
In RMB
Ending balance Opening balance
Subsidia Non-curr Non-curr Non-curr Non-curr
Current Total Current Total Current Total Current Total
ry ent ent ent ent
assets assets liability liabilities assets assets liability liabilities
assets liability assets liability
Zhongch
uang 21,246,0 3,327,16 24,573,2 294,923. 294,923. 24,491,4 123,791. 24,615,2 26,515.0 26,515.0
0.00 0.00
New 51.26 9.17 20.43 40 40 28.69 00 19.69 0 0
Energy
Aolin
16,870,1 6,351,54 23,221,7 245,271. 245,271. 22,602,5 1,808,53 24,411,1 43,720.7 43,720.7
New 0.00 0.00
73.43 7.29 20.72 82 82 84.99 6.43 21.42 1 1
Materials
Haizhuo 18,877,6 6,154,48 25,032,1 163,935. 163,935.
0.00 0.00 0.00 0.00 0.00 0.00 0.00
Energy 69.29 8.91 58.20 34 34
In RMB
Current period Last period
Total Cash flow of Total Cash flow of
Subsidiary Operating Operating
Net profit comprehensi operation Net profit comprehensi operation
revenue revenue
ve income activity ve income activity
Aolin New -24,286,641.7
0.00 -310,407.66 -310,407.66 0.00 -11,295.31 -11,295.31 -14,295.31
Materials 1
Zhongchuang -20,514,416.3
0.00 -1,390,951.81 -1,390,951.81 0.00 0.00 0.00 0.00
New Energy 8
Haizhuo 0.00 -465,527.38 -465,527.38 -21,762,749.1 0.00 0.00 0.00 0.00
182
东沣科技集团股份有限公司 2018 年年度报告全文
Energy 7
Other explanation :
(4) Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise group
(5)Financial or other supporting offer to structuring body included in consolidate statement scope
Other explanation :
2. Transaction that has owners equity shares changed in subsidiary but still with controlling rights
(1) Explanation on changes in owner's equity in subsidiaries
(2) Impact on minority interest and owner's equity attributable to parent company from transaction
In RMB
Other explanation
3. Equity in joint venture and associated enterprise
(1) Important joint venture and associated enterprise
Share-holding ratio Accounting
treatment on
Joint venture and
Main operation investment for
associated Registered place Business nature
place Directly Indirectly joint venture and
enterprise
associated
enterprise
Runhua Rural
Water (Tianjin) International
Tianjin Tianjin 30.00% Equity method
International Trading
Trade Co., Ltd.
Share-holding ratio or shares enjoyed different from voting right ratio:
Basis of the voting rights with 20% below but with major influence, or without major influence but with over 20% (20% included)
voting rights hold:
(2)Main financial information of the important joint venture
In RMB
Ending balance/Current period Opening balance/Last period
183
东沣科技集团股份有限公司 2018 年年度报告全文
Other explanation
(3)Main financial information of the important associated business
In RMB
Ending balance/Current period Opening balance/Last period
Other explanation
(4)Financial summary for non-important Joint venture and associated enterprise
In RMB
Ending balance/Current period Opening balance/Last period
Joint venture: -- --
Total on below item by shareholding ratio -- --
Associated enterprise: -- --
Total on below item by shareholding ratio -- --
Other explanation
(5) Major limitation on capital transfer ability to the Company from joint venture or affiliates
(6) Excess loss occurred in joint venture or associated
In RMB
Losses un-determined in the
Associated enterprise and joint Accumulated previous losses Accumulated losses
Period(net profit share in the
venture determined un-determined at period-end
Period)
Other explanation
(7) Unconfirmed commitment with joint venture investment concerned
(8) Intangible liability with joint venture or affiliates investment concerned
4. Major conduct joint operation
Shareholding ratio/quota enjoy
Joint operation Main operation site Register place Business nature
Directly Indirectly
Explanation on shareholding ratio or quota enjoy in joint operation different from voting rights:
If the joint operation was the independent body, basis of classification of joint operation:
Other explanation
184
东沣科技集团股份有限公司 2018 年年度报告全文
5. Structured body excluding in consolidate financial statement
Relevant explanation:
6. Other
X. Risk related with financial instrument
XI. Related party and related transactions
1. Parent company of the enterprise
Share-holding ratio
Voting right ratio on
Parent company Registration place Business nature Registered capital on the enterprise for
the enterprise
parent company
Explanation on parent company of the enterprise
The Company has no parent company; controller refers to the first largest shareholder Mr. Wang Dong, who holds 29.49% equity of
the Company.
Ultimate controller of the Company is Mr. Wang Dong
Other explanation :
2. Subsidiary of the Enterprise
Found more in Note IX (i) Equity in subsidiary .
3. Associated enterprise and joint venture
Found more in Note IX .
Other associated enterprise and joint venture that have related transaction with the Company in the Period or occurred in previous
period:
Associated enterprise and joint venture Relationship with the Enterprise
Runhua Rural Water (Tianjin) International Trade Co., Ltd. Joint venture
Other explanation
4. Other related party
Other related party Relationship with the Enterprise
Runhua RW Industrial Development Company Controller of the associated enterprise of the Company
Shanxi Products Minfeng Chemical Co., Ltd. Controller of the associated enterprise of the Company
Dongguan Hangda Venture Investment Co., Ltd. Non-controlling shareholder of the subsidiary of the Company
185
东沣科技集团股份有限公司 2018 年年度报告全文
Other explanation
5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
Whether over the
Related party Content Current period Amount approved Last period
transaction limit
Goods sold/labor service providing
In RMB
Related party Content Current period Last period
Explanation on goods purchasing, labor service providing and receiving
(2) Related trusteeship management/contract & entrust management/ outsourcing
Trusteeship management/contract:
In RMB
Termination date Trusteeship/contr
Entrusting Type of Starting date of Pricing basis of
Trustee/ of acting income
party/outsourcing trusteeship/contra trusteeship/contra trusteeship/contra
Contractor trusteeship/contra recognized in the
party cted assets ct cting income
ct period
Explanation on related entrust/contract
Entrust management/ outsourcing:
In RMB
Termination date Entrusted/outsour
Entrusting Type of Starting date of Pricing basis of
Trustee/ of cing expenses
party/outsourcing entrusted/outsour entrusted/outsour entrusted/outsour
Contractor entrusted/outsour recognized in the
party cing assets cing cing expenses
cing period
Explanation on related management/outsourcing
(3) Related leasing
As a lessor for the Company:
In RMB
Lease income recognized in the Lease income recognized in last
Lessee Assets type
Period Period
As a lessee for the Company:
186
东沣科技集团股份有限公司 2018 年年度报告全文
In RMB
Rental fee recognized in the Rental fee recognized in last
Lessor Assets type
Period Period
Dongguan Hangda Venture Warehouse and dormitory 1,268,486.50 ---
Investment Co., Ltd.
Total --- 1,268,486.50 ---
Explanation on related lease
Leasing factory: The factory that Dongguan Hangda Venture Capital Co., Ltd. rented out to Dongguan Aolin New Materials Co., Ltd.,
Dongguan Haizhuo Energy Technology Co., Ltd., and Dongguan Zhongchuang New Energy Technology Co., Ltd. is located at Room
101—102, Building No. 6, Modern Enterprise Accelerator No. 24, Gongye East Road, Songshan Lake High-tech Industrial
Development Zone, Dongguan with total building area of 6,399.60 square meters, of which Dongguan Aolin New Materials Co., Ltd.
leased building area of 3,226.95 square meters, Dongguan Haizhuo Energy Technology Co., Ltd. leased building area of 2,008.20
square meters, and Dongguan Zhongchuang New Energy Technology Co., Ltd. leased building area of 1,164.45 square meters; of
which the factory rent standard (including property management fee) was 36.00 yuan / ㎡/ month (including tax).
Leasing dormitory: The dormitory that Dongguan Hangda Venture Capital Co., Ltd. rented out to Dongguan Aolin New Materials
Co., Ltd., Dongguan Haizhuo Energy Technology Co., Ltd., and Dongguan Zhongchuang New Energy Technology Co., Ltd. is
located at the 7th Floor, Dormitory No. 8, Modern Enterprise Accelerator No. 24, Gongye East Road, Songshan Lake High-tech
Industrial Development Zone, Dongguan, a total of 19 suites of single suite. Among them, Dongguan Aolin New Materials Co., Ltd.
leased 8 suites of dormitory including Room 706, 707, 708, 709, 710, 711, 712, 713; Dongguan Haizhuo Energy Technology Co., Ltd.
leased 8 suites of dormitory, including Room 714, 715, 717, 718, 719, 720, Dongguan Zhongchuang New Energy Technology Co.,
Ltd. leased 5 suites of dormitory, including Room 701, 702, 703, 704, 705, the dormitory rental standard (including property
management fees) for a single suite was 620 yuan / suite / month (including tax).
(4) Related guarantee
The Company acts as a secured party
In RMB
Whether the guarantee
Secured party Guarantee amount Start date Expiry date
implemented or not
Dongguan Dongfeng
Intelligent Technology 20,000.00 2018-7-2 2023-7-2 N
Co., Ltd.
Total 20,000.00 --- --- ---
As a secured party by the Company
In RMB
Whether the guarantee
Guarantor Guarantee amount Start date Expiry date
implemented or not
Explanation on related guarantee
In order to meet the operation and development needs of Dongguan Dongfeng Intelligent Technology Co., Ltd. (hereinafter referred
to as ―Dongfeng Intelligent‖), which is the holding sub-subcompany of Dongfeng Technology Group, Dongfeng Intelligent intended
to apply for a comprehensive credit of the amount of not more than 200 million Yuan from Dongguan Bank Songshan Lake
Technology Sub-branch, with a credit period of two years and a single-use period of no more than five years, the special project was
187
东沣科技集团股份有限公司 2018 年年度报告全文
dedicated to the construction of the equipment industrialization project of Dongfeng New Energy located at the east side of Fuxing
Road, Dongguan Ecological Park, which took the 100% equity of Dongfeng Intelligent held by Dongguan Dongfeng Technology
Development Co., Ltd. (hereinafter referred to as ―Technology Development‖), a holding subsidiary of the company, as the pledge
guarantee, and Dongfeng Intelligent used its own land and above-ground buildings as collateral guarantee, Dongfeng Technology
Group, Technology Development, Dongguan Zhongchuang New Energy Technology Co., Ltd., Dongguan Haizhuo Energy
Technology Co., Ltd., and Dongguan Aolin New Materials Co., Ltd. guaranteed with the joint liability warranty; and the guarantee
period was 5 years
As of December 31, 2018, Dongfeng Intelligent obtained the long-term loan balance from Bank of Dongguan Co., Ltd. Songshan
Lake Technology Sub-branch of 1,017,100 million Yuan, the borrowing was limited to the follow-up construction of the equipment
industrialization project of Dongfeng New Energy. Dongfeng Technology Group Co., Ltd., Dongguan Dongfeng Technology
Development Co., Ltd., Dongguan Zhongchuang New Energy Technology Co., Ltd., Dongguan Aolin New Materials Co., Ltd., and
Dongguan Haizhuo Energy Technology Co., Ltd. guaranteed with the joint liability warranty; and the collaterals were the land use
rights and above-ground buildings of Yue ( 2017) Dongguan Real Property No. 0121786; the pledge was 100% equity of Dongguan
Dongfeng Intelligent Technology Co., Ltd. held by Dongguan Dongfeng Technology Development Co., Ltd.
(5)Borrowed funds from related party
In RMB
Related party Borrowing amount Start date Expiry date Note
Borrowing funds
Funds lent
(6)Related party’s assets transfer and debt reorganization
In RMB
Related party Content Current period Last period
(7) Remuneration of key management personnel
In RMB
Item Current period Last period
Remuneration of key management
2,215,600.00 1,816,000.00
personnel
(8) Other related transaction
6. Account receivable/payable from/to related party
(1)Account receivables
In RMB
188
东沣科技集团股份有限公司 2018 年年度报告全文
Ending balance Opening balance
Name of project Related party
Book balance Bad debt provision Book balance Bad debt provision
(2)Account payable
In RMB
Name of project Related party Ending book balance Opening book balance
7. Commitment of related party
8.Other
XII. Share-based payment
1. Share-based payment
□Applicable √ Not-applicable
2. Share-based payment settled by equity
□Applicable √ Not-applicable
3. Share-based payment settled by cash
□Applicable √ Not-applicable
4. Modification and termination of the share-based payment
5.Other
XIII. Commitment and contingency
1. Important commitment
Important commitment on balance sheet date
2. Contingency
(1) Important contingency on balance sheet date
As of 31 December 2018, as for the mortgage loans from the owner of commercial property, balance for guarantee
providing amounted as 70.74 million Yuan.
Except for the above mentioned contingency, the Company has no other important contingency that need to
released up to 31st December 2018
189
东沣科技集团股份有限公司 2018 年年度报告全文
(2) If the Company has no important contingency need to disclosed, explain reasons
The Company has no important contingency that need to disclose.
3. Other
XIV. Events after balance sheet date
1. Important non adjustment matters
In RMB
Impact on financial status and Reasons of fails to estimate the
Item Content
operation results impact
2. Profit distribution
In RMB
3. Sales return
4. Other events after balance sheet date
On March 13, 2019, the 10th session of the seventh board of directors reviewed and approved the Company to increase the capital of
100 million yuan to Dongguan Dongfeng Technology Development Co., Ltd., and increased the registered capital of Dongguan
Dongfeng Technology from 100 million yuan to 200 million yuan, and the Company still holds 100% equity. As of the approval date
of the financial report, the Company has actually increased the capital. Ended as 31st December 2018, the equity pledge has not been
occurred by the controlling shareholder.
Except for the above mentioned events, till end of the date when financial report released, the Company has no other events after
major balance sheet date need to disclosed.
XV. Other important events
1. Previous accounting errors collection
(1)Retrospective restatement
In RMB
Items impact during vary
Content Treatment procedure Accumulated impact
comparative period
(2) Prospective application
Content Approval procedure Reasons
190
东沣科技集团股份有限公司 2018 年年度报告全文
2. Debt restructuring
3. Assets exchange
(1) Exchange of non-monetary assets
(2)Other assets exchange
4. Pension plan
5. Discontinuing operation
In RMB
Profit of
discontinuing
Income tax operation
Item Revenue Expenses Total profit Net profit
expenses attributable to
owners of parent
company
Other explanation
6. Segment
(1) Recognition basis and accounting policy for reportable segment
(2) Financial information for reportable segment
In RMB
Item Offset between segment Total
(3)The Company has no segment, or unable to disclose total assets and liability of the segment, explain
reasons
(4)Other explanation
7.Other major transaction and events makes influence on investor’s decision
8.Other
Discontinuing operation
Item Discontinuing operation items of Nanjiang Trading
Current period Last period
191
东沣科技集团股份有限公司 2018 年年度报告全文
Revenue of discontinuing operation --- 66,640,312.36
Expenses of discontinuing operation 3,949,752.19 13,970,394.00
Total profit of discontinuing operation -3,949,752.19 52,669,918.36
Income tax expenses of discontinuing 110,309.68 12,906,984.10
operation
Profit of discontinuing operation -4,060,061.87 39,762,934.26
Including: Profit of discontinuing operation -4,060,061.87 39,762,934.26
attributable to owners of parent company
Total disposal income of discontinuing --- ---
operation
Income tax expenses (gains) of --- ---
discontinuing operation
Net gain/loss of disposal of discontinuing --- ---
operation
Including: Net gain/loss of disposal of --- ---
discontinuing operation attributable to owners
of parent company
Net cash flow of discontinuing operation -96,600.88 -2,253,430.86
Including: Net cash flow from operation 12,784,053.62 -14,558,880.64
activity
Net cash flow from investment activity --- 21,305,449.78
Net cash flow from financing activity -12,880,654.50 -9,000,000.00
XVI. Principle notes of financial statements of parent company
1. Other account receivable
In RMB
Item Ending balance Opening balance
Other account receivable 80,991,042.06 27,954,251.88
Total 80,991,042.06 27,954,251.88
(1)Other account receivable
1) Category of other account receivable
In RMB
Ending balance Opening balance
Category
Book balance Bad debt provision Book Book balance Bad debt provision Book value
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东沣科技集团股份有限公司 2018 年年度报告全文
value
Proportio Provision Proportio Provision
Amount Amount Amount Amount
ratio ratio
n n
Other receivables
with large single
16,668,1 16,665,1 17,782, 17,686,90
amount and accrued 16.98% 99.98% 3,082.00 38.66% 99.46% 95,533.00
86.90 04.90 439.90 6.90
for provision of bad
debt on a single basis
Other receivables
accrued for provision 81,270,9 282,989. 80,987,96 27,989, 130,835.2 27,858,718.
82.79% 0.35% 60.84% 0.47%
of bad debt by 49.93 87 0.06 554.17 9 88
portfolio
Other receivables
with minor single
229,787. 229,787. 229,787 229,787.7
amount but accrued 0.23% 100.00% 0.50% 100.00%
72 72 .72 2
for provision of bad
debt on a single basis
98,168,9 17,177,8 80,991,04 46,001, 18,047,52 27,954,251.
Total 100.00% 17.50% 100.00% 39.23%
24.55 82.49 2.06 781.79 9.91 88
Other receivables with large single amount and accrued for provision of bad debt on a single basis at period-end:
√Applicable □ Not-applicable
In RMB
Ending balance
Other account
Other account
receivable(unit) Bad debt provision Provision ratio Reasons of accrual
receivable
Dongfeng Ecological
16,668,186.90 16,665,104.90 99.98% Uncollectible
Agriculture
Total 16,668,186.90 16,665,104.90 -- --
Other receivables accrued for provision of bad debt by aging analysis method in portfolio :
√Applicable □ Not-applicable
In RMB
Ending balance
Account age
Other account receivable Bad debt provision Provision ratio
Within 1 year
Subtotal within one year 3,499,589.52 174,979.48 5.00%
1-2 years 17,447.43 3,489.49 20.00%
2-3 years 28,200.00 14,100.00 50.00%
Over 3 years 90,421.00 90,421.00 100.00%
Total 3,635,657.95 282,989.97 7.78%
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东沣科技集团股份有限公司 2018 年年度报告全文
Portfolio recognized:
Other accounts receivable accrued for provision of bad debt by percentage of balance in portfolio :
□Applicable √ Not-applicable
Other accounts receivable accrued for provision of bad debt by other methods in portfolio :
√Applicable □ Not-applicable
Other accounts receivable accrued for provision of bad debt by other methods in portfolio
Combination Ending balance
Other account receivable Bad debt provision Provision ratio (%)
Nanjiang Trading 135,241.42 --- ---
Tax Bureau of Chengde County 4,942,346.42 --- ---
Nanjiang Asia 4,971.22 --- ---
Kefeng Engineering 112,000.00 --- ---
Huijing Property 7,380,732.92 --- ---
Kefeng Aerospace 60,000.00
Dongguan Dongfeng Technology 65,000,000.00 --- ---
Total 77,635,291.98 --- ---
Portfolio recognized:
In portfolio, the accrual of bad debt in way of other method was 0.00 Yuan, mainly because there is minor estimated recoverable risk.
2)Bad debt provision accrual collected or switch back
There is152,154.58 Yuan provision for bad debts accrued in the Period; and 1,021,802.00 Yuan regains or switch back in the Period.
Including the followed significant amount:
In RMB
Unit Regains or switch back Way of regain
3)Other receivables actually written-off during the reporting period
In RMB
Item Amount charge off
Major other account receivables written-off:
In RMB
Nature of other Reasons of Arising from related
Unit Amount charge off Procedures
account receivable written-off transaction (Y/N)
Explanation on other account receivable:
4)Other account receivables category by nature of money
In RMB
Nature of money Ending book balance Opening book balance
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东沣科技集团股份有限公司 2018 年年度报告全文
Intercourse fund 89,225,891.04 44,963,887.31
Petty cash 1,399,398.05 800,332.72
Land appreciation tax rebate 4,942,346.42
Other 2,601,289.04 237,561.76
Total 98,168,924.55 46,001,781.79
5)Top five other account receivables collected by arrears party at ending balance
In RMB
Proportion in total
Ending balance of
Unit Nature Ending balance Account age Ending balance of
bad debt provision
other receivables
Dongguan Kefeng
Intercourse fund 65,000,000.00 Within one year 66.21%
Technology
Ecological Within one year, 1-2
Intercourse fund 16,668,186.90 16.98% 16,665,104.90
Agriculture years and 2-3 years
Within one year, 1-2
Huijing Property Intercourse fund 7,380,732.92 7.52%
years and 2-3 years
Tax Bureau of
Intercourse fund 4,942,346.42 Within one year 5.03%
Chengde County
Chengde Liyuan
Investment Intercourse fund 1,776,513.60 Within one year 1.81%
Consulting Company
Total -- 95,767,779.84 -- 97.56% 16,665,104.90
6)Account receivables related to government subsidies
In RMB
Account age at Time and amount
Unit Government grant Ending balance
period-end collected and basis
7)Other receivable for termination of confirmation due to the transfer of financial assets
8)The amount of assets and liabilities that are transferred other receivable and continued to be involved
Other explanation :
2. Long-term equity investment
In RMB
Ending balance Opening balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserves reserves
Investment for
272,803,036.40 272,803,036.40 248,114,466.37 248,114,466.37
subsidiary
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东沣科技集团股份有限公司 2018 年年度报告全文
Investment for
joint venture and
9,170,370.00 9,170,370.00 9,170,370.00 9,170,370.00
associated
enterprises
Total 281,973,406.40 9,170,370.00 272,803,036.40 257,284,836.37 9,170,370.00 248,114,466.37
(1)Investment for subsidiary
In RMB
Accrual in the
Ending balance of
Current period
Invested company Opening balance Current increased Ending balance impairment
decreased Depreciation
provision
reserves
Nanjiang Trading 5,311,429.97 5,311,429.97
Nanjiang
90,000,000.00 90,000,000.00
Investment
Nanjiang Asia 5,000,166.64 5,000,166.64
Hangzhou
30,000,000.00 30,000,000.00
Dongfeng
Kefeng Trading 45,147,154.77 45,147,154.77
Kefeng
2,655,714.99 2,655,714.99
Engineering
Dongguan
Dongfeng 70,000,000.00 30,000,000.00 100,000,000.00
Technology
Dongfeng Power
Total 248,114,466.37 30,000,000.00 5,311,429.97 272,803,036.40
(2) Investment for joint venture and associated enterprise
In RMB
Changes in Period
Investme
Ending
nt Adjustme
Cash balance
Additiona gains/loss nt of Provision
Invested Opening Other dividend Ending of
l Capital es other for
company balance equity or profit Other balance impairme
investmen reduction recognize comprehe impairme
changes declare to nt
t d by nsive nt losses
issue provision
equity income
method
196
东沣科技集团股份有限公司 2018 年年度报告全文
I. Joint venture
II. Associated enterprise
Runhua 9,170,370 9,170,370 9,170,370
RW .00 .00 .00
9,170,370 9,170,370 9,170,370
Subtotal
.00 .00 .00
9,170,370 9,170,370 9,170,370
Total
.00 .00 .00
(3)Other explanation
3. Operation income and operation cost
In RMB
Current period Last period
Item
Income Cost Income Cost
Main business 118,807,719.93 103,821,248.79 244,805,702.13 231,565,613.02
Other business 2,264,150.96 8,002,407.74 55,952.94
Total 121,071,870.89 103,821,248.79 252,808,109.87 231,621,565.96
Other explanation :
4. Investment income
In RMB
Item Current period Last period
Long-term equity investment measured by
36,240,654.50
cost
Investment income from disposal of
17,328,070.03
long-term equity investment
Investment income from holding the
204,560.53
financial products
Total 53,773,285.06
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东沣科技集团股份有限公司 2018 年年度报告全文
5. Other
XVII. Supplementary information
1. Details of current non-recurring profits/gains and losses
√Applicable □ Not-applicable
In RMB
Item Amount Remark
Gains/losses from the disposal of
4,526,245.58 ---
non-current asset
Government grant reckoned into current
gain/loss (not including the subsidy
enjoyed in quota or ration according to 2,896,000.00
national standards, which are closely
relevant to enterprise’s business)
Held transaction financial asset, gains/losses
of changes of fair values from transaction
financial liabilities, and investment gains
from disposal of transaction financial asset,
1,144,246.03 Income from financial products
transaction financial liabilities and financial
asset available for sales, exclude the
effective hedging business relevant with
normal operations of the Company
Other non-operating income and expense
-470,819.42
other than the abovementioned ones
Gains/losses satisfied definition of the
18,501,800.54 Subsidiary disposal
non-recurring gains/losses
Less: Impact on income tax -6,649,368.19
Total 33,246,840.92 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss, explain reasons
□Applicable √ Not-applicable
2. ROE and earnings per share
Profits during report period Weighted average ROE Earnings per share
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东沣科技集团股份有限公司 2018 年年度报告全文
Diluted EPS
Basic EPS (Yuan/share)
(Yuan/share)
Net profits belong to common stock
2.01% 0.01 0.01
stockholders of the Company
Net profits belong to common stock
stockholders of the Company after
-3.24% -0.02 -0.02
deducting nonrecurring gains and
losses
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable √ Not-applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable √ Not-applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for the
differences adjustment audited by foreign auditing institute, listed name of the institute
4.Other
Explanation on abnormal condition and reasons for the items of account statement
Item Ending balance Opening balance (or Rate of Reasons
(or current amount) last amount) changes(%)
Monetary fund 36,306,825.10 74,805,209.06 -51.47 Account received in advance for property
declined in the period
Accounts paid in 62,449,793.03 183,595.06 33,914.96 Account paid in advance for new project in the
advance period
Other account 8,588,597.44 58,740,204.94 -85.38 The intercourse funds declined in the period
receivable
Inventory 151,585,557.50 234,653,825.84 -35.40 Development products carried forward in the
period
Fixed assets 17,302,279.65 9,674,396.99 78.85 Purchased fixed assets in the period
Construction in 101,650,833.16 2,267,164.04 43.84 New construction in process increased in the
process period
Productive biological 121,437.50 17,971.39 575.73 Purchased productive biological asset in the
asset period
Expense on Research 13,346,410.47 3,513,561.56 279.85 New project developed in the period
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东沣科技集团股份有限公司 2018 年年度报告全文
and Development
Other non-current 120,392,369.00 10,427,021.55 105.46 Engineering amount paid in advance increased
assets
Note payable and 6,668,789.67 15,487,833.06 -56.94 The amount payable for engineering decreased
account payable in the period
Accounts received in 16,269,319.99 64,165,709.37 -74.65 Sales of property declined in the period
advance
Wage payable 981,089.59 2,201,668.93 -55.44 Staff declined in the period
Taxes payable 921,967.58 13,171,059.13 -93.00 Income taxes paid for land disposal in the period
Other account payable 118,570,218.85 25,952,193.34 356.88 The intercourse funds increased in the period
Operating revenue 123,508,083.90 250,071,863.07 -50.61 Sales of property declined in the period
Tax and extras -247,832.89 9,791,294.48 -102.53 Rebate of the land appreciation tax in the period
Sales expense 115,346.71 14,417,090.26 -99.20 No sale agency fee withdrawal in the period
Financial expense -385,552.98 1,346,177.29 -128.64 Capitalization of interest in the period
Investment income 19,646,046.57 1,501,873.01 120.81 Bonus received in the period and subsidiary
disposed
Income from assets 4,526,245.58 65,059,983.64 -93.04 Disposal of fixed assets and intangible assets are
disposal declined in the period
Income tax expenses 110,309.68 12,906,984.10 -99.15 Income tax paid for assets disposal last period
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Section XII. Documents available for reference
1. Financial statement carried with the signature and seal of the Person in charge of the Company, person in charge
of the accounting works and accountant in charge.
2. Original audit report seal with accounting firms and signature and seal from CPA.
3. Text and original draft of the notice that disclosed in reporting period on newspapers appointed by CSRC.
201
