2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
GUANGDONG RIEYS GROUP COMPANY LTD.
2013 Semi-annual Report
2013-031
August 2013
1
2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
I. Important Reminders, Contents & Explanation
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and senior
management staff of Guangdong Rieys Group Company Ltd. (hereinafter referred to as “the
Company”) warrant that this report is factual, accurate and complete without any false record,
misleading statement or material omission. And they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
The Company plans not to distribute cash dividends or bonus shares or turn capital reserve into
share capital.
Mr. Chen Hongcheng, company principal, Mr. Chen Jincai, chief of the accounting work, and Mr.
Zheng Guangde, chief of the accounting organ (chief of accounting), hereby confirm that the
Financial Report enclosed in this report is factual, accurate and complete.
English Translation for Reference Only. Should there be any discrepancy between the two versions,
the Chinese version shall prevail.
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Contents
2013 Semi-annual Report .................................................................................................................. 1
I. Important Reminders, Contents & Explanation ......................................................................... 1
II. Company Profile ........................................................................................................................... 4
III. Accouonting & Business Highlights ........................................................................................... 6
IV. Report of the Board of Directors ................................................................................................ 8
V. Significant Events ........................................................................................................................ 14
VI. Change in Shares & Shareholders ........................................................................................... 22
VII. Directors, Supervisors & Senior Management Staff ............................................................. 26
VIII. Financial Statements .............................................................................................................. 28
IX. Documents Available for Reference ......................................................................................... 56
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Explanation
Refers
Term Contents
to
Refers
Company, the Company Guangdong Rieys Group Company Ltd.
to
Refers
Shenghengchang Puning Shenghengchang Trade Development Co., Ltd.
to
Refers
Risheng Shenzhen Risheng Chuangyuan Asset Management Co., Ltd.
to
Refers A real estate project developed by Puning Hengda Real Estate
Shangdi Central
to Development Co., Ltd.
Refers
CSRC China Securities Regulatory Commission
to
Refers
SZSE, the stock exchange Shenzhen Stock Exchange
to
Refers
The Company Law The Company Law of the People’s Republic of China
to
Refers
The Securities Law The Securities Law of the People’s Republic of China
to
Refers
Yuan RMB
to
Refers
Reporting period 1 Jan. 2012-31 Dec. 2012
to
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
II. Company Profile
I. Basic information of the Company
Stock abbreviation LYB Stock code 200168
Stock exchange listed with Shenzhen Stock Exchange
Chinese name of the Company 广东雷伊（集团）股份有限公司
Abbr. of the Chinese name of
雷伊
the Company
English name of the Company
GUANGDONG RIEYS GROUP COMPANY LTD
(if any)
Abbr. of the English name of
Rieys
the Company (if any)
Legal representative of the
Chen Hongcheng
Company
II. For Contact
Company Secretary Securities Affairs Representative
Name Xu Wei Luo Dandan
Room 4003-4008, 40/F International Room 4003-4008, 40/F International
Contact address Chamber of Commerce Tower， No. 3 Chamber of Commerce Tower， No. 3
Fuhua Road, Futian District, Shenzhen Fuhua Road, Futian District, Shenzhen
Tel. 0755-82250045 0755-82250045
Fax 0755-82251182 0755-82251182
E-mail xw@200168.com xw@200168.com
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
III. Accounting & Business Highlights
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of the accounting policy or
correction of any accounting error?
□ Yes √ No
Reporting period Same period of last year YoY +/-（％）
Operating revenues (RMB Yuan) 101,392,043.00 7,617,917.19 1,230.97%
Net profit attributable to shareholders of
7,184,645.02 -13,570,192.44 -39.99%
the Company (RMB Yuan)
Net profit attributable to shareholders of
the Company after extraordinary gains and 7,438,365.98 -23,431,917.52 -131.74%
losses (RMB Yuan)
Net cash flows from operating activities
3,875,417.21 12,681,286.44 -69.44%
(RMB Yuan)
Basic EPS (RMB Yuan/share) 0.02 -0.04 -150%
Diluted EPS (RMB Yuan/share) 0.02 -0.04 -150%
Weighted average ROE (%) 2% -4.2% 6.2%
As at the end of the
As at the end of last year YoY +/-（％）
reporting period
Total assets (RMB Yuan) 482,216,077.18 526,645,545.47 -8.44%
Net assets attributable to shareholders of
362,798,149.10 355,613,504.08 2.02%
the Company (RMB Yuan)
II. Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
Item Amount Explanation
Gains/losses on the disposal of non-current assets (including the
-9,326.17 Gain/loss on fixed asset disposal
offset part of asset impairment provisions)
Other gain/loss items that meet the definition of an extraordinary Fines, delay charges, donations,
-244,815.78
gain/loss etc.
Less: Income tax effects 344.13
Minority interests effects (after tax) -765.12
Total -253,720.96 --
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
IV. Report of the Board of Directors
I. Overview
At the beginning of 2013, with house prices rising and social resources gathering in real estate, the government unveiled the “New
Five National Policies for Real Estate”, further demonstrating its determination to support the basic macro-control policy of
supporting residential needs and restraining house buying for speculative investment. The continuous real estate macro-control based
on “purchase, loan and price limitation”, the expanding real estate tax pilot coverage, the still tight policy environment and the
multiple macro-control policies will affect the real estate sector in the short run. Meanwhile, due to the European Debt Crisis, the
slow recovery of the U.S. economy, the slow forwarding of the global economy and other factors, China’s economy will face a series
of challenges such as a slower economic engine and a slowing-down growth.
However, along with development of the cities, the population size, layout and movement all have direct influence on the potential
capacity of the real estate market. In particular, “urbanization” has been positioned by the new government as one of the most
important engines for China’s economic growth in the future. The new urban population due to a higher urbanization rate and old
town renewal will create a huge housing demand. Besides, the “income increase plan” and “consumption upgrading” put forward by
the central government will also increase people’s purchasing power effectively. Therefore, considering the rigid demand and the
rational housing improvement needs, the Company still has a strong faith in the medium- and long-term development of the real
estate sector.
In the short run, due to various factors, the real estate market is regionalized, indicating a greater market risk. In the reporting period,
adhering to the operating philosophy of “growth in stability”, the Company proactively expanded subsequent projects, researched
many real estate markets and analyzed multiple projects. Subsequently, the Company will further optimize the internal management
structure, improve talent development, clarify its strategic position, improve the operating mode, abandon the outdated notions and
innovate itself to increase the core competitiveness and seize market opportunities.
For the reporting period, the Company achieved operating revenues of RMB 101.39 million, up 1230.97% when compared with
RMB 7.62 million of the same period of last year; operating profit of RMB 13.30 million, up -193.72% when compared with RMB
-14.19 million of the same period of last year; and net profit attributable to the Company (without subsidiaries) of RMB 7.18 million,
up -152.91% from RMB -13.57 million of the same period of last year. These changes were mainly due to the sales income from the
Shangdi Central project developed by the Company. Closing accounts receivable stood at RMB 12.71 million, down 56.98% over the
opening balance of RMB 29.54 million, which was mainly because commercial houses were sold and mortgages increased. Closing
other payables stood at RMB 7.53 million, down 77.05% over the opening balance of RMB 32.81 million, which was mainly because
some loans were paid off. Closing prepayments stood at RMB 30.91 million, up 2106.07% over the opening balance of RMB 1.40
million, which was mainly because the prepaid construction was not yet settled with invoices. Closing accounts payable stood at
RMB 16.02 million, down 48.09% over the opening balance of RMB 30.87 million, which was mainly because the credit purchases
were settled. Closing other payables stood at RMB 7.53 million, down 77.05% over the opening balance of RMB 32.81 million,
which was mainly because some loans were paid off.
To sum up, in the reporting period, according to the set objectives, the Company did a lot in sale of projects, solving overdue bank
loans, etc. All the plans were carried out excellently.
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
II. Main business analysis
Overview
In the reporting period, the operating revenues and profit came from the Shangdi Central project. During the reporting period, []
commercial houses and [] shops of the project were sold and [] commercial houses and [] shops were left. Except for the said project,
the Company currently has no other projects in process or land reserves.
YoY change of major financial data:
Unit: RMB Yuan
Reporting period Same period of last year YoY +/-% Main reasons for change
Recognized income from
Operating revenues 101,392,043.00 7,617,917.19 1,230.97% sale of commercial
houses
Costs due to sale of
Operating costs 66,551,899.59 5,242,728.04 1,169.41%
commercial houses
Withdrawal from the
Selling expenses 364,306.74 757,544.50 -51.91%
garment sector
Administrative expenses 9,675,497.18 9,118,311.22 6.11%
Some loans were paid off
Financial expenses 2,662,941.93 4,228,100.01 -37.02% and the interest expenses
decreased accordingly.
Profit from sale of
Income tax expenses 5,900,592.79 -618,301.50 1,054.32% commodity houses
increased.
R&D input 0.00 0.00 0%
Net cash flows from
3,875,417.21 12,681,286.44 -69.44%
operating activities
Net cash flows from
-364,642.71 -389,238.23 -6.31%
investing activities
Net cash flows from Some bank loans were
-1,000,000.00 -9,500,000.00 -89.47%
financing activities paid off.
Net increase in cash and
2,510,774.50 2,792,048.21 -10.07%
cash equivalents
Major changes to the profit structure or sources of the Company during the reporting period:
□ Applicable √ Inapplicable
No major changes occurred to the profit structure or sources of the Company during the reporting period.
Reporting period progress of the future development planning in the disclosed documents of the Company such as share-soliciting
prospectuses, offering prospectuses, asset reorganization reports, etc.:
□ Applicable √ Inapplicable
The Company did not mention any future planning for the reporting period in its disclosed documents such as share-soliciting
prospectuses, offering prospectuses, asset reorganization reports, etc.
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Review the progress of the previously disclosed business plan in the reporting period:
1. Continue to sell the Shangdi Central project to ensure earnings for 2013.
In the reporting period, the Shangdi Central project developed the Company helped achieve a sales of RMB 101.39 million and a net
profit of RMB 17.70 million.
2. Find subsequent development projects as soon as possible and prepare well and reserve some land properly.
In the reporting period, the relevant departments of the Company conducted a lot of research and analysis, trying to establish new
projects in compliance with the actual situation of the Company as soon as possible.
3. Properly handle the rest of the overdue loans, gradually recover its financing capability in the banking system and adopt various
financing channels and methods to further ensure its operation.
In the reporting period, the Company proactively talked with the Guangzhou branch of China Everbright Bank about loan repayment
and returned all the loan principals on 4 Jul. 2013. After the repayment, the Company currently has no bank loans.
4. Further improve the internal control mechanism and prepare well for the internal control audit report.
In the reporting period, the relevant departments of the Company proactively pushed forward improvement of internal control rules.
5. Continue to work on talent and brand development.
In the reporting period, the Company continued to work on talent development as planned and push forward brand development.
6. Considering that many companies with A-shares and/or B-shares have started to deal with the B-share issue, indicating the B-share
reform as the order of the day, the Company will continue to pay attention to and study the relevant developments and work out a
practical solution for B-shares.
In the reporting period, the relevant departments of the Company studied successful cases of B-share reform, paid close attention to
the implementation plans of companies similar to the Company and gradually improved its conditions to seize opportunities and
safeguard its sustainable development in the future.
III. Breakdown of main business
Unit: RMB Yuan
Increase/decrease Increase/decrease Increase/decrease
of operating of operating costs of gross profit
Operating Gross profit rate
Operating costs revenues over the over the same rate over the same
revenues (%)
same period of period of last year period of last year
last year (%) (%) (%)
Classified by industry:
Real estate 101,392,043.00 66,551,899.59 34.36%
Classified by product:
Commodity
101,392,043.00 66,551,899.59 34.36%
houses
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Classified by region:
Guangdong
101,392,043.00 66,551,899.59 34.36%
Province
IV. Investment analysis
1. Analysis to main subsidiaries and stock-participating companies
Main subsidiaries and stock-participating companies:
Unit: RMB Yuan
Main
Company Company Registered Operating Operating
Industry products/ser Total assets Net assets Net profit
name variety capital revenues profit
vices
Shenzhen
Investment
Rieys 44,906,636.
Subsidiary Trade and import 50,000,000
Industrial 07
& export
Co., Ltd.
Production
Puning
and sale of
Tianhe Manufactur 65,100,000 368,613,090
Textile Subsidiary garments,
Manufactor e （HKD） .59
knitted dyed
y Co., Ltd.
cloth, etc.
Tianrui
(HK) 63,971,476.
Subsidiary Trade Trade 1(USD）
Trading 86
Co., Ltd.
Real estate
developmen
Puning
t (operate
Hengda
with the
Real Estate Subsidiary Real estate 26,000,000
valid
Developme
qualificatio
nt Co., Ltd.
n
certificate)
Shenzhen Real estate
Yingda developmen
Chuangyua t (operate
n with the
Subsidiary Real estate 1 1.00 1.00 0.00 0.00 0.00
Constructio valid
n qualificatio
Investment n
Co., Ltd. certificate)
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
V. Particulars about researches, visits and interviews received in this reporting period
Main discussion and
Time of reception Place of reception Way of reception Visitor type Visitor materials provided by the
Company
Office of the Inquiring about the time for
10 Jan. 2013 By phone Individual Investor
Company resumption of share trading
Inquiring about the
implementation situation of
Office of the subsequent projects of the
14 Jan. 2013 By phone Individual Investor
Company Company and the direction
of the Company’s B-share
reforms
Office of the Inquiring about the main
24 Jan. 2013 By phone Individual Investor
Company business of the Company
Inquiring about the time of
shareholding increase plan
Office of the
30 Jan. 2013 By phone Individual Investor implemented by the
Company
principal shareholder of the
Company
Office of the Inquiring about changes in
31 Jan. 2013 By phone Individual Investor
Company industry of the Company
Proposing the advice on
Office of the
22 Feb. 2013 By phone Individual Investor B-share reform for the
Company
Company
Inquiring about the
development situation of
Office of the
22 Feb. 2013 By phone Individual Investor real estates and proposing
Company
the advice on B-share
reform for the Company
Office of the Inquiring about the sales of
28 Feb. 2013 By phone Individual Investor
Company real estates of the Company
Office of the Inquiring about the content
5 Mar. 2013 By phone Individual Investor
Company of the 2012 annual report
Office of the Inquiring about the issues
6 Mar. 2013 By phone Individual Investor
Company on B-share reform
Inquiring about the main
business in the first quarter
Office of the
6 Mar. 2013 By phone Individual Investor of 2013 for the Company
Company
and the approval of removal
from listing
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Office of the Proposing the advice of
18 Mar. 2013 By phone Individual Investor
Company B-share reform
Inquiring about the
Office of the
20 Mar. 2013 By phone Individual Investor approval of cancelling the
Company
risks warning
Office of the Inquiring about attending
11 Apr. 2013 By phone Individual Investor
Company the general meeting
Office of the Inquiring about attending
15 Apr. 2013 By phone Individual Investor
Company the general meeting
Inquiring when the actual
Office of the controller would perform
20 May 2013 By phone Individual Investor
Company the shareholding increase
commitment
Inquiring how the capital
increase by the actual
controller in the second
Office of the biggest corporate
14 Jun. 2013 By phone Individual Investor
Company shareholder would affect
the Company and whether
there’s any policy support
for B-share reform
Inquiring when the actual
Office of the controller would perform
20 Jun. 2013 By phone Individual Investor
Company the shareholding increase
commitment
Inquiring about the share
Office of the
21 Jun. 2013 By phone Individual Investor trading suspension of the
Company
Company
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
V. Significant Events
I. Corporate governance
The actual situation of the Company’s governance did not differ in principle from the Company Law and the relevant CSRC
requirement.
II. Significant contracts and their fulfillment
1. Guarantees provided by the Company
Unit: RMB Ten Thousand
Guarantees provided by the Company for external parties (excluding those for subsidiaries)
Disclosure
date of Guarante
Actual
relevant Actual e for a
Amount for occurrence date Type of Period of Executed
Guaranteed party announcem guarantee related
guarantee (date of guarantee guarantee or not
ent on the amount party or
agreement)
guarantee not
amount
Five years
from the
independent
Puning
12 Oct. contract
Huafengqiang Trade 3,000 8 Oct. 2012 2,500 Mortgage No No
2012 (loan
Co., Ltd.
contract)
coming into
effect
Total external guarantee line Total actual occurred amount
approved during the reporting 3,000 of external guarantee during 2,500
period (A1) the reporting period (A2)
Total external guarantee line that Total actual external guarantee
has been approved at the end of 3,000 balance at the end of the 2,500
the reporting period (A3) reporting period (A4)
Guarantees provided by the Company for its subsidiaries
Disclosure Guarante
Actual
date of Actual e for a
Amount for occurrence date Type of Period of Executed
Guaranteed party relevant guarantee related
guarantee (date of guarantee guarantee or not
announcem amount party or
agreement)
ent on the not
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
guarantee
amount
Total guarantee line approved for Total actual occurred amount
the subsidiaries during the of guarantee for the
0 0
reporting period subsidiaries during the
(B1) reporting period (B2)
Total guarantee line that has been
Total actual guarantee balance
approved for the subsidiaries at
0 for the subsidiaries at the end 0
the end of the reporting period
of the reporting period (B4)
(B3)
Total guarantee amount provided by the Company (total of the above-mentioned two kinds of guarantees)
Total guarantee line approved Total actual occurred amount
during the reporting period 3,000 of guarantee during the 2,500
(A1+B1) reporting period (A2+B2)
Total guarantee line that has been
Total actual guarantee balance
approved at the end of the
3,000 at the end of the reporting 2,500
reporting period
period (A4+B4)
(A3+B3)
Proportion of total guarantee amount (A4+B4) to the net assets
6.89%
of the Company (%)
Of which:
Amount of guarantee for shareholders, actual controller and
0
related parties (C)
Amount of debt guarantee provided for the guaranteed party
whose asset-liability ratio is not less than 70% directly or 0
indirectly (D)
Part of the amount of the total guarantee over 50% of net assets
0
(E)
Total amount of the above three guarantees (C+D+E) 0
Explanation on possible bearing joint responsibility of
N/A
liquidation due to immature guarantee (if any)
Explanation on provision of guarantees for external parties in
N/A
violation of the prescribed procedure (if any)
Explanation on particulars about the guarantees by compound ways:
III. Commitments made by the Company or shareholders holding over 5% of the Company’s
shares in the reporting period, or such commitments carried down into the reporting period
Commitment Time of making Period of
Commitment Contents Fulfillment
maker commitment commitment
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Commitment on share reform
Commitment in the acquisition report or
the report on equity changes
Commitments made upon the assets
reorganization
Commitments made upon IPO or
refinancing
The actual
controller made
a commitment to
increase the
shareholding in
the Company by
a controlled
account within Within 12
12 months since months since the
Other commitments made to minority The actual It has not yet
the first 14 Jan. 2013 first
shareholders controller executed.
shareholding shareholding
increase day, increase day
with an
increasing
proportion not
over 2% of the
total share
capital of the
Company.
Executed timely or not? Yes
Detailed reason for failing to execute and
N/A
the next plan (if any)
IV. Explanation on other significant events
1. Explanation about pledge of the Company’s shares
Shenzhen Risheng Chuangyuan Asset Management Co., Ltd., one of the Company’s shareholders, pledged its shareholdings (34.02
million shares, equal to 10.68% of the Company’s total shares) to Shenzhen Pengcheng CCB Investment Fund on 23 Jul. 2013, with
the pledge period from 23 Jul. 2013 to the date when pawnee applies for unlocking. (For details, see the Announcement No.
2013-026 published on Securities Times, Ta Kung Pao and www.cninfo.com.cn on 25 Jul. 2013.)
2. Explanation about the share trading suspension from 21 Jun.-26 Jul.
The share trading of the Company was suspended from 21 Jun.-26 Jul. because it was planning a significant asset reorganization.
During the share trading suspension, the Company talked for multiple times with the other transaction party and its related parties in
this asset reorganization. In strict compliance with the relevant laws and regulations of CSRC and Shenzhen Stock Exchange, the
Company hired an intermediary agency to carry out thorough investigations on the target assets. During the suspension, the Company
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
seriously performed the duty of information disclosure by disclosing a progress announcement on the significant asset reorganization
every five trading days. And the Company made a commitment not to plan another significant asset reorganization within at least
three months. (For details, see the Announcement No. 2013-028 published on Securities Times, Ta Kung Pao and
www.cninfo.com.cn on 26 Jul. 2013.)
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
VI. Change in Shares & Shareholders
I. Change in shares
Before the change Increase/decrease (+, -) After the change
Capitalizat
Issuance ion of
Proportion Bonus Proportio
Amount of new public Others Subtotal Amount
(%) shares n (%)
shares reserve
fund
I. Shares subject to trading 164,025,0 164,025,0
51.48% 0 0 0 0 0 51.48%
moratorium 00 00
1. Shares held by the State 0 0% 0 0 0 0 0 0 0%
2. Share held by
0 0% 0 0 0 0 0 0 0%
state-owned corporations
3. Shares held by other 164,025,0 164,025,0
51.48% 0 0 0 0 0 51.48%
domestic corporations 00 00
Among which: shares held 164,025,0 164,025,0
51.48% 0 0 0 0 0 51.48%
by domestic corporations 00 00
Shares held by domestic
0 0% 0 0 0 0 0 0 0%
natural persons
4. Shares held by foreign
0 0% 0 0 0 0 0 0 0%
investors
Among which: Shares held
0 0% 0 0 0 0 0 0 0%
by foreign corporations
Shares held by foreign
0 0% 0 0 0 0 0 0 0%
natural persons
5. Share held by senior
0 0% 0 0 0 0 0 0 0%
management staff
II. Shares not subject to 154,575,0 154,575,0
48.52% 0 0 0 0 0 48.52%
trading moratorium 00 00
1. Renminbi ordinary
0 0% 0 0 0 0 0 0 0%
shares
2. Domestically listed 154,575,0 154,575,0
48.52% 0 0 0 0 0 48.52%
foreign shares 00 00
3. Overseas listed foreign
0 0% 0 0 0 0 0 0 0%
shares
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
4. Others 0 0% 0 0 0 0 0 0 0%
318,600,0 318,600,0
III. Total shares 100% 0 0 0 0 0 100%
00 00
Reason for the change in shares
□ Applicable √ Inapplicable
Approval of the change in shares
□ Applicable √ Inapplicable
Transfer of the change in shares
□ Applicable √ Inapplicable
Effects of the change in shares on the basic EPS, diluted EPS, net assets per share attributable to common shareholders of the
Company and other financial indexes over the last year and last period
□ Applicable √ Inapplicable
Other contents that the Company considered necessary or were required by the securities regulatory authorities to disclose
□ Applicable √ Inapplicable
Change of the total shares, shareholder structure, asset structure and liability structure
□ Applicable √ Inapplicable
II. Total number of shareholders and their shareholdings
Unit: share
Total number of shareholders at the
12,870
end of the reporting period
Particulars about shares held by shareholders with a shareholding percentage over 5%
Total Increase Number Pledged or frozen shares
Number
shares /decreas of
of
Name of Nature of Shareholding held at e during non-trad
tradable
shareholder shareholder percentage (%) the the able Status of shares Number of shares
shares
period-e reportin shares
held
nd g period held
Puning
Shenghengchang Domestic
117,855, 117,855,
Trade non-state-owned 36.99% 0 0 0
000 000
Development corporation
Co., Ltd
Shenzhen
Risheng
Domestic
Chuangyuan 34,020, 34,020,
non-state-owned 10.68% 0 0 0
Asset 000 000
corporation
Management Co.,
Ltd.
Guotai Junan Foreign 18,398, +18,398 18,398,
5.77% 0 0
Securities(Hong corporation 834 ,834 834
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2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Kong) Limited
Puning Lianhua Domestic
12,150, 12,150,
Industrial Co., non-state-owned 3.81% 0 0 0
000 000
Ltd. corporation
China Everbright
Foreign 7,264,3 +7,264, 7,264,3
Securities (HK) 2.28% 0 0
corporation 10 310 10
Limited
Domestic natural 7,235,2 7,235,2
Su Youhe 2.27% +88,952 0 0
person 07 07
Shanghai Wanguo
Foreign 3,146,61 +105,18 3,146,61
Securities (HK) 0.99% 0
corporation 1 42 1
Limited
Domestic natural 2,272,4 +1,811, 2,272,4
Fan Jiongyang 0.71% 0
person 00 515 00
Domestic natural 2,077,3 +2,077, 2,077,3
Xie Qingjun 0.65% 0
person 00 300 00
Domestic natural 1,300,0 -406,50 1,300,0
Zheng Suxian 0.41% 0
person 00 0 00
Strategic investor or general
corporation becoming a top ten
N/A
shareholder due to placing of new
shares (if any) (see Note 3)
There existed related relationship among Puning Shenghengchang Trade Development Co.,
Ltd., Shenzhen Risheng Chuangyuan Asset Management Co., Ltd. and Puning Lianhua
Explanation on associated
Industrial Co., Ltd. (name changed from “Shantou Lianhua Industrial Co., Ltd.” to “Puning
relationship or/and persons acting in
Lianhua Industrial Co., Ltd. due to relocation), which belonged to action-in-concert
concert among the above-mentioned
promulgated by Measures for the Administration of Disclosure of Information on the Change
shareholders:
of Shareholdings in Listed Companies. The Company did not know whether there existed
related relationship among other shareholders.
Particulars about shares held by the top ten shareholders holding shares not subject to trading moratorium
Type of shares
Name of shareholder Number of tradable shares held at the period-end
Type Number
Domestically
Guotai Junan Securities(Hong Kong)
18,398,834 listed foreign 18,398,834
Limited
shares
Domestically
China Everbright Securities (HK)
12,150,000 listed foreign 12,150,000
Limited
shares
Domestically
Su Youhe 7,235,207 7,235,207
listed foreign
19
2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
shares
Domestically
Shanghai Wanguo Securities (HK)
3,146,611 listed foreign 3,146,611
Limited
shares
Domestically
Fan Jiongyang 2,272,400 listed foreign 2,272,400
shares
Domestically
Xie Qingjun 2,077,300 listed foreign 2,077,300
shares
Domestically
Zheng Suxian 1,300,000 listed foreign 1,300,000
shares
Domestically
NGAI KWOK PAN 1,145,816 listed foreign 1,145,816
shares
Domestically
LUO DONG HUI 1,100,000 listed foreign 1,100,000
shares
Domestically
Ke Zhongfeng 714,164 listed foreign 714,164
shares
Explanation on associated
relationship or/and persons acting in
concert among the top ten tradable
Unknown
shareholders and between the top ten
tradable shareholders and the top ten
shareholders
Explanation on shareholders
participating in the margin trading Naught
business (if any) (see Note 4)
Did any shareholder of the Company carry out an agreed buy-back in the reporting period?
□ Yes √ No
20
2013 Semi-annual Report of Guangdong Rieys Group Company Ltd.
VII. Directors, Supervisors & Senior Management Staff
I. Directors, supervisors and senior management staff who left their posts
Name Position Type Date Reason
Feng Zhuokui Vice president Employment 22 Apr. 2013 Newly employed
21
VIII. Financial Statements
I. Audit report
Have these financial statements been audited?
□ Yes √ No
These financial statements for the first half of 2013 have not been audited.
II. Financial statements
Currency unit for the statements in the notes to these financial statements: RMB Yuan
1. Consolidated balance sheet
Prepared by Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 24,066,267.29 21,555,492.79
Settlement reserves
Intra-group lendings
Transactional financial assets
Notes receivable
Accounts receivable 12,708,648.18 29,542,060.33
Accounts paid in advance 30,909,821.90 1,401,124.90
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract
reserves
Interest receivable
Dividend receivable
Other accounts receivable 17,855,582.60 8,712,918.25
Financial assets purchased under
agreements to resell
Inventories 274,250,611.88 340,802,511.47
Non-current assets due within 1 year
22
Other current assets
Total current assets 359,790,931.85 402,014,107.74
Non-current assets:
Loans by mandate and advances
granted
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment
Investing property
Fixed assets 85,975,473.31 87,845,171.59
Construction in progress
Engineering materials 54,526.00 54,526.00
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 27,383,583.21 27,720,177.33
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 8,577,402.81 8,577,402.81
Other non-current assets 434,160.00 434,160.00
Total of non-current assets 122,425,145.33 124,631,437.73
Total assets 482,216,077.18 526,645,545.47
Current liabilities:
Short-term borrowings 14,099,960.00 15,099,960.00
Borrowings from Central Bank
Customer bank deposits and due to
banks and other financial institutions
Intra-group borrowings
Transactional financial liabilities
Notes payable
Accounts payable 16,028,613.75 30,877,322.71
Accounts received in advance 21,913,975.01 28,576,119.48
Financial assets sold for repurchase
23
Handling charges and commissions
payable
Employee’s compensation payable 626,654.91 730,461.85
Tax payable 39,280,369.08 44,779,973.52
Interest payable 15,576,401.18 13,756,401.18
Dividend payable
Other accounts payable 7,532,445.56 32,816,218.09
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting underwriting of
securities
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 115,058,419.49 166,636,456.83
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Estimated liabilities
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 115,058,419.49 166,636,456.83
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 318,600,000.00 318,600,000.00
Capital reserves 52,129,496.58 52,129,496.58
Less: Treasury stock
Specific reserves
Surplus reserves 86,036,260.20 86,036,260.20
Provisions for general risks
24
Retained profits -93,967,607.68 -101,152,252.70
Foreign exchange difference
Total equity attributable to owners of
362,798,149.10 355,613,504.08
the Company
Minority interests 4,359,508.59 4,395,584.56
Total owners’ (or shareholders’) equity 367,157,657.69 360,009,088.64
Total liabilities and owners’ (or
482,216,077.18 526,645,545.47
shareholders’) equity
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
2. Balance sheet of the Company
Prepared by Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 4,619,037.40 7,628,811.81
Transactional financial assets
Notes receivable
Accounts receivable
Accounts paid in advance
Interest receivable
Dividend receivable
Other accounts receivable 74,731,541.84 94,265,296.12
Inventories
Non-current assets due within 1 year
Other current assets
Total current assets 79,350,579.24 101,894,107.93
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 243,312,509.68 243,312,508.68
Investing property
Fixed assets 81,874,830.89 83,619,246.08
25
Construction in progress
Engineering materials 54,526.00 54,526.00
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 27,383,583.21 27,720,177.33
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 2,466,835.50 2,466,835.50
Other non-current assets
Total of non-current assets 355,092,285.28 357,173,293.59
Total assets 434,442,864.52 459,067,401.52
Current liabilities:
Short-term borrowings 14,099,960.00 15,099,960.00
Transactional financial liabilities
Notes payable
Accounts payable 19,442.64 19,442.64
Accounts received in advance
Employee’s compensation payable 278,828.04 159,511.60
Tax payable 1,060,772.27 2,686,106.07
Interest payable 15,576,401.18 13,756,401.18
Dividend payable
Other accounts payable 169,505,519.31 186,273,159.74
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 200,540,923.44 217,994,581.23
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Estimated liabilities
26
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 200,540,923.44 217,994,581.23
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 318,600,000.00 318,600,000.00
Capital reserves 52,129,496.58 52,129,496.58
Less: Treasury stock
Specific reserves
Surplus reserves 86,036,260.20 86,036,260.20
Provisions for general risks
Retained profits -222,863,815.70 -215,692,936.49
Foreign exchange difference
Total owners’ (or shareholders’) equity
233,901,941.08 241,072,820.29
Total liabilities and owners’ (or
434,442,864.52 459,067,401.52
shareholders’) equity
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
3. Consolidated income statement
Prepared by Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Total operating revenues 101,392,043.00 7,617,917.19
Including: Sales income 101,392,043.00 7,617,917.19
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 88,088,739.21 21,813,148.94
Including: Cost of sales 66,551,899.59 5,242,728.04
Interest expenses
Handling charge and
commission expenses
27
Surrenders
Net claims paid
Net amount withdrawn for the
insurance contract reserve
Expenditure on policy dividends
Reinsurance premium
Taxes and associate charges 8,926,286.36
Selling and distribution expenses 364,306.74 757,544.50
Administrative expenses 9,675,497.18 9,118,311.22
Financial expenses 2,662,941.93 4,228,100.01
Asset impairment loss -92,192.59 2,466,465.17
Add: Gain/(loss) from change in fair
3,404.00
value (“-” means loss)
Gain/(loss) from investment (“-”
means loss)
Including: share of profits in associates
and joint ventures
Foreign exchange gains (“-” means
loss)
III. Business profit (“-” means loss) 13,303,303.79 -14,191,827.75
Add: non-operating income 6,875.00 1,401.20
Less: non-operating expense 261,016.95 58,179.50
Including: loss from non-current asset
disposal
IV. Total profit (“-” means loss) 13,049,161.84 -14,248,606.05
Less: Income tax expense 5,900,592.79 -618,301.50
V. Net profit (“-” means loss) 7,148,569.05 -13,630,304.55
Including: Net profit achieved by
combined parties before the
combinations
Attributable to owners of the
7,184,645.02 -13,570,192.44
Company
Minority shareholders’ income -36,075.97 -60,112.11
VI. Earnings per share -- --
(I) Basic earnings per share 0.02 -0.04
(II) Diluted earnings per share 0.02 -0.04
28
Ⅶ. Other comprehensive incomes
Ⅷ. Total comprehensive incomes 7,148,569.05 -13,630,304.55
Attributable to owners of the
7,184,645.02 -13,570,192.44
Company
Attributable to minority
-36,075.97 -60,112.11
shareholders
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
4. Income statement of the Company
Prepared by Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Total sales 0.00 0.00
Less: cost of sales 0.00 0.00
Business taxes and surcharges
Distribution expenses
Administrative expenses 4,348,507.92 4,249,607.81
Financial costs 2,719,246.06 3,293,889.61
Impairment loss 136,310.38
Add: gain/(loss) from change in fair
3,404.00
value (“-” means loss)
Gain/(loss) from investment (“-” means
loss)
Including: income form investment on
associates and joint ventures
II. Business profit (“-” means loss) -7,067,753.98 -7,676,403.80
Add: non-business income 496.92
Less: non-business expense 103,125.23 40,000.00
Including: loss from non-current asset
disposal
III. Total profit (“-” means loss) -7,170,879.21 -7,715,906.88
Less: income tax expense -34,077.60
IV. Net profit (“-” means loss) -7,170,879.21 -7,681,829.28
V. Earnings per share -- --
(I) Basic earnings per share -0.02 -0.02
29
(II) Diluted earnings per share -0.02 -0.02
VI. Other comprehensive income
VII. Total comprehensive income -7,170,879.21 -7,681,829.28
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
5. Consolidated cash flow statement
Prepared by Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Cash flows from operating activities:
Cash received from sale of
111,655,503.27 140,845,788.66
commodities and rendering of service
Net increase of deposits from
customers and dues from banks
Net increase of loans from the central
bank
Net increase of funds borrowed from
other financial institutions
Cash received from premium of
original insurance contracts
Net cash received from reinsurance
business
Net increase of deposits of policy
holders and investment fund
Net increase of disposal of tradable
financial assets
Cash received from interest, handling
charges and commissions
Net increase of intra-group
borrowings
Net increase of funds in repurchase
business
Tax refunds received 36,687.67 3,000,000.00
Other cash received relating to
41,306,885.03 8,071,501.00
operating activities
Subtotal of cash inflows from operating
152,999,075.97 151,917,289.66
activities
30
Cash paid for goods and services 43,911,805.96 68,389,373.16
Net increase of customer lendings
and advances
Net increase of funds deposited in the
central bank and amount due from
banks
Cash for paying claims of the original
insurance contracts
Cash for paying interest, handling
charges and commissions
Cash for paying policy dividends
Cash paid to and for employees 3,649,191.48 3,853,324.47
Various taxes paid 20,055,088.25 1,656,666.51
Other cash payment relating to
81,507,573.07 65,336,639.08
operating activities
Subtotal of cash outflows from
149,123,658.76 139,236,003.22
operating activities
Net cash flows from operating activities 3,875,417.21 12,681,286.44
II. Cash flows from investing activities:
Cash received from withdrawal of
investments
Cash received from return on
investments
Net cash received from disposal of
fixed assets, intangible assets and other 120,000.00 143,130.00
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
investing activities
Subtotal of cash inflows from
120,000.00 143,130.00
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 484,642.71 532,368.23
assets
Cash paid for investment
Net increase of pledged loans
Net cash paid to acquire subsidiaries
31
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
484,642.71 532,368.23
investing activities
Net cash flows from investing activities -364,642.71 -389,238.23
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Including: Cash received from
minority shareholder investments by
subsidiaries
Cash received from borrowings
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
activities
Repayment of borrowings 1,000,000.00 9,500,000.00
Cash paid for interest expenses and
distribution of dividends or profit
Including: dividends or profit paid
by subsidiaries to minority shareholders
Other cash payments relating to
financing activities
Sub-total of cash outflows from
1,000,000.00 9,500,000.00
financing activities
Net cash flows from financing activities -1,000,000.00 -9,500,000.00
IV. Effect of foreign exchange rate
changes on cash and cash equivalents
V. Net increase in cash and cash
2,510,774.50 2,792,048.21
equivalents
Add: Opening balance of cash and
21,555,492.79 1,600,749.63
cash equivalents
VI. Closing balance of cash and cash
24,066,267.29 4,392,797.84
equivalents
32
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
6. Cash flow statement of the Company
Prepared by Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Cash flows from operating activities:
Cash received from sale of
commodities and rendering of service
Tax refunds received
Other cash received relating to
117,036,546.54 19,581,502.09
operating activities
Subtotal of cash inflows from operating
117,036,546.54 19,581,502.09
activities
Cash paid for goods and services
Cash paid to and for employees 769,035.01 782,113.11
Various taxes paid 1,745,041.25 845,890.48
Other cash payment relating to
116,523,743.69 9,085,239.76
operating activities
Subtotal of cash outflows from
119,037,819.95 10,713,243.35
operating activities
Net cash flows from operating activities -2,001,273.41 8,868,258.74
II. Cash flows from investing activities:
Cash received from retraction of
investments
Cash received from return on
investments
Net cash received from disposal of
fixed assets, intangible assets and other
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
investing activities
Subtotal of cash inflows from
investing activities
Cash paid to acquire fixed assets, 8,500.00
33
intangible assets and other long-term
assets
Cash paid for investment
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
1.00
investing activities
Subtotal of cash outflows from
8,501.00
investing activities
Net cash flows from investing activities -8,501.00 0.00
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Cash received from borrowings
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
activities
Repayment of borrowings 1,000,000.00 9,500,000.00
Cash paid for interest expenses and
distribution of dividends or profit
Other cash payments relating to
financing activities
Sub-total of cash outflows from
1,000,000.00 9,500,000.00
financing activities
Net cash flows from financing activities -1,000,000.00 -9,500,000.00
IV. Effect of foreign exchange rate
changes on cash and cash equivalents
V. Net increase in cash and cash
-3,009,774.41 -631,741.26
equivalents
Add: Opening balance of cash and
7,628,811.81 1,338,922.68
cash equivalents
VI. Closing balance of cash and cash
4,619,037.40 707,181.42
equivalents
34
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
7. Consolidated Statement of Changes in Owners’ Equity
Prepared by Guangdong Rieys Group Company Ltd.
Jan.-Jun. 2013
Unit: RMB Yuan
Jan.-Jun. 2013
Equity attributable to owners of the Company
Paid-up
Total
Item Minority
capital Less: General
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 318,600 52,129,4 86,036, -101,15 4,395,584 360,009,08
previous year ,000.00 96.58 260.20 2,252.70 .56 8.64
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 318,600 52,129,4 86,036, -101,15 4,395,584 360,009,08
the year ,000.00 96.58 260.20 2,252.70 .56 8.64
III. Increase/ decrease in the 7,184,64 -36,075.9 7,148,569.
period (“-” means decrease) 5.02 7 05
7,184,64 -36,075.9 7,148,569.
(I) Net profit
5.02 7 05
(II) Other comprehensive
incomes
7,184,64 -36,075.9 7,148,569.
Subtotal of (I) and (II)
5.02 7 05
(III) Capital paid in and
reduced by owners
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
3. Others
35
(IV) Profit distribution
1. Appropriations to
surplus reserves
2. Appropriations to
general risk provisions
3. Appropriations to
owners (or shareholders)
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(Ⅶ) Other
318,600 52,129,4 86,036, -93,967, 4,359,508 367,157,65
IV. Closing balance
,000.00 96.58 260.20 607.68 .59 7.69
Jan.-Jun. 2012
Unit: RMB Yuan
Jan.-Jun. 2013
Equity attributable to owners of the Company
Paid-up
Total
Item capital Minority
Less: General
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 318,600 52,129,4 86,036, -127,21 4,495,708 334,041,78
previous year ,000.00 96.58 260.20 9,679.36 .04 5.46
Add: retrospective
36
adjustment due to business
combination under the same
control
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 318,600 52,129,4 86,036, -127,21 4,495,708 334,041,78
the year ,000.00 96.58 260.20 9,679.36 .04 5.46
III. Increase/ decrease in the 26,067,4 -100,123. 25,967,303
period (“-” means decrease) 26.66 48 .18
26,067,4 -100,123. 25,967,303
(I) Net profit
26.66 48 .18
(II) Other comprehensive
incomes
26,067,4 -100,123. 25,967,303
Subtotal of (I) and (II)
26.66 48 .18
(III) Capital paid in and
reduced by owners
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
3. Others
(IV) Profit distribution
1. Appropriations to
surplus reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. New increase of capital
(or share capital) from capital
public reserves
37
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(Ⅶ) Other
318,600 52,129,4 86,036, -101,15 4,395,584 360,009,08
IV. Closing balance
,000.00 96.58 260.20 2,252.70 .56 8.64
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
8. Statement of Changes in Owners’ Equity of the Company
Prepared by Guangdong Rieys Group Company Ltd.
Jan.-Jun. 2013
Unit: RMB Yuan
Jan.-Jun. 2013
Paid-up
Less: General Total
Item capital (or Capital Specific Surplus Retained
treasury risk owners’
share reserve reserve reserve profit
stock reserve equity
capital)
I. Balance at the end of the 318,600,00 52,129,496 86,036,260 -215,692,9 241,072,82
previous year 0.00 .58 .20 36.49 0.29
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 318,600,00 52,129,496 86,036,260 -215,692,9 241,072,82
the year 0.00 .58 .20 36.49 0.29
III. Increase/ decrease in the -7,170,879. -7,170,879.
period (“-” means decrease) 21 21
-7,170,879. -7,170,879.
(I) Net profit
21 21
38
(II) Other comprehensive
incomes
-7,170,879. -7,170,879.
Subtotal of (I) and (II)
21 21
(III) Capital paid in and
reduced by owners
1. Capital paid in by owners
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
(IV) Profit distribution
1. Appropriations to surplus
reserves
2. Appropriations to general
risk provisions
3. Appropriations to owners
(or shareholders)
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the period
2. Used in the period
(Ⅶ) Other
318,600,00 52,129,496 86,036,260 -222,863,8 233,901,94
IV. Closing balance
0.00 .58 .20 15.70 1.08
Jan.-Jun. 2012
Unit: RMB Yuan
39
Jan.-Jun. 2012
Paid-up
Less: General Total
Item capital (or Capital Specific Surplus Retained
treasury risk owners’
share reserve reserve reserve profit
stock reserve equity
capital)
I. Balance at the end of the 318,600,00 52,129,496 86,036,260 -216,677,2 240,088,47
previous year 0.00 .58 .20 81.87 4.91
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 318,600,00 52,129,496 86,036,260 -216,677,2 240,088,47
the year 0.00 .58 .20 81.87 4.91
III. Increase/ decrease in the
984,345.38 984,345.38
period (“-” means decrease)
(I) Net profit 984,345.38 984,345.38
(II) Other comprehensive
incomes
Subtotal of (I) and (II) 984,345.38 984,345.38
(III) Capital paid in and
reduced by owners
1. Capital paid in by owners
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
(IV) Profit distribution
1. Appropriations to surplus
reserves
2. Appropriations to general
risk provisions
3. Appropriations to owners
(or shareholders)
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
40
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the period
2. Used in the period
(Ⅶ) Other
318,600,00 52,129,496 86,036,260 -215,692,9 241,072,82
IV. Closing balance
0.00 .58 .20 36.49 0.29
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
(III) Company profile
Guangdong Rieys Group Company Ltd. (hereinafter referred to as “the Company”) is a listed company established by five enterprises
including Puning Haicheng Industrial Co., Ltd (this company changed its name to Shenzhen Shenghengchang Industrial Co., Ltd.
after relocating in Shenzhen; in 2007 this company was renamed as Guangzhou Shenghengchang Investment Co., Ltd.; in 2008 this
company was renamed as Guangzhou Shenghengchang Trade and Development Co., Ltd.; in January 28, 2010 this company was
renamed as Puning Shenghengchang Trade Development Co., Ltd.), an original sino-foreign cooperated enterprise of Hongxing
Company. Under approval of Guangdong Economic System Reform Committee (1997) No. 113 on November 17, 1997 after joint stock
system restructure based on Puning Hongxing Textile and Apparel Production Factory Co., Ltd., which originally was a sino-foreign
joint venture. The registered capital of the Company is RMB 80,000,000 when established, which was divided into 80,000,000 shares
of RMB1.00 each.
In March 1999, with the approval of the Shareholders’ General Meeting, the Company declared a Bonus Issue of 3.5 shares per 10
shares based on the total number of shares accrued in the register as at December 31, 1998 (80 million shares), making the registered
capital increased to 108,000,000 shares.
The Company issued 60,000,000 shares of foreign invested stock domestically listed (“Stock B”) for foreign investors on October 17,
2000, and issued 9,000,000 shares of Stock B for exercise of over-allotment options during the period from October 27 to November
22, 2000 in accordance with approval of ZJFXZ (2000) No. 133 issued by China Securities Regulatory Commission on September 29,
2000. The registered capital of the Company increased to RMB 177,000,000 after issuance of Stock B, which was divided into
177,000,000 shares of RMB1.00 each. The registered capital of the Company increased to 318,600,000 after years of bonus distribution
and transfer increase in paid-in capital, which was divided into 318,600,000 shares of RMB1.00 each.
As at 31 June 2013, the Company’s total share capital was 318,600,000 shares, including 164,025,000 non-tradable legal shares
(representing 51.48% of total shares and 154,575,000 domestic listed foreign shares (stock B) (representing 48.52% of total shares).
The Company and its subsidiaries (hereinafter referred to as “the Group”)’s main scopes of business are real estates development and
management and other investments.
(IV) Principal accounting policies and estimates and previous error
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1. Basis for the preparation
The Company and its subsidiaries are prepared based on assumption of the Company’s continuing operations, according to transactions
and events actually occurred, and based on “Basic Accounting Standard for Business Enterprises” and other rules of accounting
standards to recognize, measure and prepare financial statement.
2. Statement of complying with Accounting Standards for Business Enterprises
The financial statements prepared by the Company meet the requirements of "Accounting Standards for Business Enterprises - Basic
Standards" issued by the Ministry of Finance on February 15, 2006 and 38 special accounting standards, as well as application guidance
of the accounting standards for business enterprise, interpretation of the accounting standards for business enterprise and other relevant
regulations (hereafter referred as “Accounting Standard for Business Enterprise”), and truly and completely reflect the financial
conditions, operation results and cash flow of the Company.
In addition, the Group's financial statements also comply with the disclosure requirements on financial statements and notes thereof in
“Compilation Rules for Information Disclosures by Companies That Offer Securities to the Public No.15 - General Provisions for
Financial Reports” (hereinafter referred to as "the No. 15 ") amended by China Securities Regulatory Commission (hereinafter referred
to as "SFC") in 2010.
3. Fiscal year
The fiscal year of the Company is the solar calendar year, which is from January 1 to June 31.
4. Recording currency
Recording currency is RMB.
5. Accounting treatment for business combinations under the common control and not under the common control
1. Business combination under the common control
Business combination under the common control refers to that parties involved in the merger are subject to the ultimate control of the
same party or same multi-parties before & after the merger and such control is not temporary.
Assets and liabilities acquired by merging parties in a business combination are measured at the book value of the combined parties at
the merge date. Upon any difference between book value of net assets obtained by merging parties and book value the merging price
they pay (or the aggregate nominal amount of issued shares), it should adjust the capital surplus (share premium), and if capital surplus
(share premium) isn’t sufficient to dilute, then adjust retained earnings. Merger date refers the date that the merging parties actually gain
the control of the combined parties.
2. Business combination not under the common control
Business combination not under the common control refers to that parties involved in the merger are not subject to the ultimate control
of the same party or same multi-parties before & after the merger.
Costs of the combination paid by the purchasers are the sum of assets paid to obtain the control of the combined parties, liabilities
incurred or assumed, the fair value of equity securities issued at the purchase date, and various direct costs occurred in the business
combination. The difference between the fair value of its assets paid and the book value thereof is accrued to current profit or loss.
Purchase date refers to the date that the purchasers actually gain the control of the purchased parties.
The purchasers allocate the costs of combination on the purchase date, and confirm the fair values of identifiable assets, liabilities and
contingent liabilities of the purchased parties they obtain. The difference that costs of combination exceed the fair value of identifiable
assets of the purchased parties obtained in the merger will be recognized as goodwill; the difference that costs of combination are less
than the fair value of identifiable assets of the purchased parties obtained in the merger will be accrued in current profit or loss.
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6. Preparation of the consolidated financial statements
(1) Preparation of the consolidated financial statements
The combined scope of consolidated financial statements includes the Company and its subsidiaries. Subsidiary’s operating results and
financial position are included in the consolidated financial statements from the controlled date until the end date.
As for subsidiary obtained by the Company through business combination under the common control, in the preparation of current
consolidated financial statements, it will be deemed that the combined subsidiary is incorporated into the consolidation scope when the
ultimate controlling party of the Company implements the control right, and the beginning balance of consolidated financial statements
and comparative statements will be adjusted accordantly.
As for subsidiary obtained by the Company through business combination not under the common control, in the preparation of current
consolidated financial statements, the financial statements of such subsidiary will be adjusted based on the fair value of the identifiable
assets and liabilities determined at the purchase date, and since the purchase date, the consolidated subsidiary will be incorporated into
the consolidation scope.
If the accounting period or accounting policy adopted by subsidiary and parent company are not consistent, a necessary adjustment
shall be made to the financial statements of subsidiary in accordance with the accounting period or accounting policy of parent
company when the consolidated financial statements are prepared. All major transactions, balances and unrealized profit or loss among
enterprises within the consolidation scope will be offset in the preparation of consolidated financial statements.
Interests and income attributable to minority shareholders of subsidiary will be listed separately respectively under the Shareholders’
Equity in the Consolidated Balance Sheet and under the Net Profit in the Consolidated Income Statement.
If the losses attributable to the minority shareholders exceed the share of minority shareholders enjoyed in the ownership interest of the
subsidiary, in addition to the part that the minority shareholders have the obligation and the ability to take, the balance will offset against
the shareholders’ equity of parent company. If the subsidiary makes a profit subsequently, before making up the loss attributed to
relevant minority shareholders beard by shareholders’ equity of parent company, all the profits are attributable to shareholders’ equity
of parent company.
(2) The subsidiary whose stock right is purchased and then sold in two continuing fiscal years or sold and then bought need to
disclose its relating accountant management method.
Inapplicable.
7. Confirmation standard for cash and cash equivalent
In preparing the cash flow statement, the cash equivalents of the Company include the investments with short period (it usually expires
within three months from the purchase date), characteristics of high liquidity, easy conversion to certain amount of cash and little risk
of value change.
8. Transactions of foreign currencies and conversion of financial statements in foreign currencies
(1) Foreign currency transactions
Foreign currency transactions are converted into RMB for recording purpose at the exchange rate on the first day of the period when the
transaction occurs..
(2) Conversion of financial statement in foreign currencies
① Adjustments are made to foreign currency accounts in accordance with the exchange rate prevailing on the balance sheet date. Value
of non currency item accrued at fair value by foreign currency is adjusted in accordance with the exchange rate prevailing on fair value
confirm date. Conversion differences arising from those specific borrowings are to be capitalized as part of the cost of the construction
in progress in the period before the fixed assets being acquired and constructed has not yet reached working condition for its intended
43
use. Conversion differences arising from other accounts are charged to financial expenses
② In balance sheet, assets and liabilities items are converted into RMB at the exchange rate prevailing on the consolidated balance
sheet date. Owner’s equity items (excluding undistributed profit item) are converted into RMB at the exchange rate when the
transaction occurs. In income statement, revenue and expenses items are accrued by the proper method and the approximate rate when
the transaction occurs. Translation difference occurred for above reason is disclosed in the consolidated balance sheet as a separate
item.
9. Financial instruments
(1) Classification of financial instruments
Based on the purposes of obtaining the financial assets and assuming the liabilities, the Company’s management classifies the financial
instruments into: the financial assets or financial liabilities that are calculated in the fair values and whose changes are accrued to
current profit or loss, including trading financial assets or financial liabilities, and those directly designated to be calculated in the fair
values and whose changes are accrued to current profit or loss; the held-to-maturity investments; loans and receivables;
available-for-sale financial assets; and other financial liabilities, etc.
(2) Confirmation basis and measurement of financial instruments
①The financial assets (or financial liabilities) that are calculated in the fair values and whose changes are accrued to current profit or
loss
The fair values (excluding cash dividends that have been declared but have not been distributed and bond interests that have exceeded
the expiry dates but have not been drawn) are deemed as the initial confirmation amount on acquisition. Relevant transaction expenses
are charged to profit or loss of the period.
The interests or cash dividends obtained during the holding period are recognized as investment income. Change of fair values is
charged to profit or loss of the period at the year end.
Difference between the fair value and initial book value is recognized as investment income upon disposal. Adjustment is made to gain
or loss from changes in fair values.
② Held-to-maturity investments
The sum of fair values (excluding bond interests that have exceeded the expiry dates and have not been drawn) and relevant transaction
expenses are deemed as the initial confirmation amount.
During the holding period, interest income is recognized as investment income based on the amortized cost and actual interest rate (if
the difference between the actual interest rate and the nominal interest rate is tiny, calculation is based on the nominal interest rate). The
actual interest rates are determined upon acquisition and remain unchanged during the expected holding period or a shorter period
applicable.
Difference between the amount received and book value of the investment is charged to investment income upon disposal.
If the Company sells or re-classifies a large amount of held to maturity investments prior to maturity (large amount refers to the total
amount relative to such investments prior to the sale or re-classification), then the Company will re-classify the rest of such type of
investment as financial assets available for sale, and the Company will not re-classify any financial assets as held to maturity in the
current accounting period or following two full fiscal years, but the following is excepted: the sale date or re-classification date is near
to the maturity or redemption date of such investment (such as three months before maturity), and the market interest rate changes have
no significant effect on the fair value of the investment; all the initial principal of such investment is nearly recovered according to the
periodic payments or early repayment under the contract, resell or re-classify the remaining; sale or re-classification is caused by
independent matters the Company can’t control, not expected to recur and difficult to predict reasonably.
③ Receivables and loans
Receivables primarily are the amount receivable formed from sales of goods or service provision of the Company and other claims,
44
which initial recognition amount will be confirmed according to the contract or agreement price receivable from the purchasers. For
recovery or disposal of loans and receivables, the difference between the price obtained and the book value of loans and receivables is
charged to current profit or loss.
Loans are mainly loans issued by financial companies. For loans issued by financial institutions according to the current market
conditions, the initial recognition amount will be confirmed according to the principal of loans issued and related transaction expenses.
Interest income recognized during the holding period of the loan will be calculated at the actual rate. Real interest rate will be
determined upon obtaining loans, and will be unchanged within the expected duration of the loan or applicable shorter period. If the
difference between real interest rate and the contract interest rate is small, then the income will be calculated at the contract interest rate.
④ Available-for-sale financial assets
The sum of fair values (excluding cash dividends that have been declared but have not been distributed and bond interests that have
exceeded the expiry dates but have not been drawn) and relevant transaction expenses is deemed as the initial confirmation amount.
The interests and cash dividends generated during the holding period are accrued to investment income. At year end, available-for-sale
financial assets are calculated in the fair values and the changes in fair values are accrued to the capital reserves (other capital reserves).
Difference between the amount received and the book value of the financial assets is recognized as investment gain or loss upon
disposal. At the same time, the accumulated changes in fair value previously recognized in the owners’ equity are transferred into
investment gain or loss.
⑤ Other financial liabilities
The sum of fair values and relevant transaction expenses is deemed as the initial confirmation amount. The subsequent calculation
adopts the amortized cost method. Method for determining fair value: directly refer to quotations in active markets (or using valuation
techniques, etc.).(For using valuation techniques, it should disclose relevant valuation assumptions in accordance with various types of
financial assets or financial liabilities, including prepayment rates, expected credit loss rate, interest rate or discount rate.)
(3) Confirmation and measurement of transform of financial assets
The Company should terminate recognizing these financial assets when the transform occurs and almost all risk and return of the
financial assets ownership have been transferred to the transferee; The Company should not terminate recognizing this financial assets
if almost all risk and return of the financial assets ownership have been remained.
Essence is more important than form when judging whether the transform meets the requirements of the financial assets termination
recognition conditions mentioned above. The Company divides the transform of financial assets into entire transfer and partial transfer.
(1) If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the difference between the amounts of the
following two items shall be recorded in current profit or loss:
①The book value of the transferred financial asset;
②The sum of consideration received from the transfer, and the accumulative amount of the changes in the fair values originally
recorded in the owners’ equities (in the case that the financial asset involved in the transfer is an available-for-sale financial asset).
(2) For partial transfers of financial assets that meet the recognition conditions of termination in recognition, the book value of the
whole financial assets are spitted into the derecognized portion and the recognised portion according to their respective relative fair
values (under this situation, the retained service assets are deemed as a part of the exterminated financial assets), and the difference
between the following two items shall be recorded in the current profit or loss:
①Book value of the derecognized portion;
②The sum of the consideration of the derecognized portion and the accumulated changes in fair value previously recognized in the
owners’ equity related to the derecognized portion (in the case that the assets transferred are available-for-sale financial assets).
For transfers of financial assets that do not meet the conditions of termination in recognition, the financial assets remain recognition and
the consideration received is recognized as financial liabilities.
(4) Derecognized financial liabilities
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If the existing obligations of financial liabilities have been discharged in whole or in part, then the Company will derecognize such
financial liability or part thereof.
If all or part of the financial liabilities is derecognized, the difference between the book value of the derecognized financial liabilities
and payment will be charged into current profit or loss.
(5) Confirmation of fair values of financial assets and financial liabilities
For financial assets or financial liabilities measured at fair value by the Company, the Company will use all or part of the quotations in
the market (or use valuation techniques) as their fair values.
(6) Testing and withdrawing method for impairment of financial assets(excluding account receivable)
① Impairment of available-for-sale financial assets:
If at the year end the fair values of the available-for-sale financial assets decline significantly, or the trend of the decline is expected to
be non-temporary after consideration of all relevant factors, the assets are deemed impaired and impairment loss is recognized together
with the amount transferred from the accumulated decreases in fair values previously recognized in the owners’ equity.
② Impairment of held-to-maturity financial assets and loans:
For held-to-maturity investments and loans, if there is objective evidence on the incidence of impairment, then the impairment loss will
be calculated and recognized according to the difference between the book value and the present value of estimated future cash flows.
(7) As for undue financial assets which can be reclassified as available-for-sale financial assets, descriptions of holding
intention or ability to change are needed
Inapplicable.
10. Standard and withdrawing method of provision for bad debts of receivables
If there is objective evidence at the year end to indicate that impairment exists in accounts receivable (including accounts receivable,
notes receivable, other receivables, long-term receivables, etc.), their carrying amount should be decreasingly recorded as recoverable
amount. The decreased amount should be recognized as impairment loss of assets and be recorded into current profit or loss.
Prepayment’s risk characteristics are subject to the nature of prepayment, if the prepayment is for the purchase of goods or equipment,
then before the agreed delivery date, or not settled but delivered, no provision for bad debts; if the other party of the contract fails to
deliver and overdue more than one year after the contract data, provision for bad debts will be made according to the risk characteristics
of receivables. For prepayment paid for the construction project, if not fully pay the whole price and the ownership of the construction
project is expected to be obtained, no provision for bad debts.
For intra-group receivables, provision for bad debts will be made according to expected bad debt losses may occur.
Conduct impairment testing separately on accounts receivable with relatively higher individual price at end of the period. If there is
objective evidence to indicate that impairment exists, recognize impairment loss and provide for bad and doubtful debts in accordance
with the difference between its future cash flow and carrying amount.
(1) Provision for bad debts of individual material receivables
Individual material receivables are the top five largest
receivables or sum of receivables which account for 10% of
ending balance of accounts receivable. For individual
receivables not material at end of the period, the Company can
Standard of significant single amounts conduct impairment testing separately; for receivables without
impairment through separate testing (including receivables
material and not material), the Company will categorize them
into the receivables groups with similar risk factors, and
assigns a certain percentage of the end of the period balance of
46
the receivable groups to determine the impairment loss and
make provision for bad debts.
Conduct impairment testing separately on accounts receivable
with relatively higher individual price at end of the period. If
there is objective evidence to indicate that impairment exists,
recognize impairment loss and provide for bad and doubtful
Withdrawing method of provision for bad debts of significant
debts in accordance with the difference between its future cash
single amounts
flow and carrying amount.
Individual material receivables are the top five largest
receivables or sum of receivables which account for 10% of
ending balance of accounts receivable.
(2) Withdrawing receivables of provision for bad debts according to group
Provision for bad debts
Name Basis to confirm group
according to group
Withdrawing provision for bad debts according to aging of accounts in group
√ Applicable □ Inapplicable
Appropriation proportion of receivables Appropriation proportion of other
Age
(%) receivables (%)
1year (including 1 year) 2%
1－2 years 10%
Over 3 years 50%
4－5 years 80%
Over 5 years 100%
Withdrawing provision for bad debts according to balance percentage in group
□ Applicable √ Inapplicable
Withdrawing provision for bad debts according to other methods in group
□ Applicable √ Inapplicable
(3) Single amounts not significant but individually withdrawing provision of bad debts of receivables
11. Inventory
(1) Inventory classification
Inventory is classified to:
① Real estate development products: completed development products, development products in construction, and products to be
developed.
② Non-real estate products: raw materials, products in production, stock merchandise, delivery commodity, commission processing
materials, etc.
(2) Method for inventory valuation
Method: weighted average method
Inventories are valued at the lower of cost and net realizable value.
47
Real estate development product costs include land cost, construction costs and other costs. Borrowing costs meet the capitalization
conditions are also included in real estate development product costs.
Non-real estate development product costs include purchase cost, process cost and other costs.
The inventory is calculated using weighted average method when delivered.
(3) Confirmation of net realizable value of inventory and Recording method of provision for inventory devaluation
At the end of the year, after overall check of the inventory, draw or adjust provision for inventory devaluation according to the lower
of the cost of inventory and net realizable values of inventory.
In normal operation process, net realizable values of commodities inventories for direct sales including finished goods, commodities
and materials for sales are determined by the estimated selling prices minus the estimated selling expenses and relevant taxes and fees;
In normal operation process, net realizable values of materials that need further processing are determined by the estimated selling
prices of the finished goods minus estimated cost to completion, estimated selling expenses and relevant taxes. For the inventory held
to implement sales contract or work contract, its net realizable value is calculated on the basis of contract price. For the balance of
inventory beyond the amount of the sales contract, its net realizable value is calculated on the basis of general selling price.
Provision for inventory devaluation is provided for based on individual inventory item at end of the period. For inventory that has large
quantity and low unit price, the provision for inventory devaluation is provided for based on categories of the inventory. For inventory
related to the products manufactured and sold in the same district, with same or similar use or purpose, and difficult to account for
separately from other items, the provision for inventory devaluation is provided for on a consolidated basis.
When the factors that influence the decreased bookkeeping of inventory value have disappeared, switch back from the provision for
inventory devaluation amount that previously appropriated and the amount that switched back is charged to profit or loss of current
period.
(4) System of stock inventories
Perpetual inventory system is applied.
(5) Amortization for low cost and short lived articles and package materials
For low cost and short lived articles, use step-amortization method；
For package materials, use step-amortization method.
12. Long-term Equity Investment
(1) Confirmation of initial investment cost
① Long-term equity investment caused by the enterprise merger
In case the long-term equity investment are made to obtain the equities of the enterprises under the common control and the Company
pays the cash, transfers the non-cash assets or bears the liabilities as the consideration for the merger, the book value share on the
merging date to obtain the owners’ equities of the merging party will be deemed as the initial investment cost of long-term equity
investment. The difference between the initial investment cost of long-term equity investment and paid cash, transferred non-cash
assets and book values of liabilities will be supplemented by the capital reserve; in case the capital reserve is not enough, the remaining
gains will be adjusted. In case the Company issues the equity securities as the merger consideration, the book value share on the
merging date to obtain the owners’ equities of the merging party will be deemed as the initial investment cost of long-term equity
investment. If the book value amount of the issued shares is deemed as the capital, the difference between the initial investment cost of
long-term equity investment and the book value amount of the issued shares will be supplemented by the capital reserve; in case the
capital reserve is not enough, the remaining gains will be adjusted. All direct expenses related to the enterprise merger, including the
auditing expense, evaluation expense, legal service expense, etc will be accrued to the current profit or loss.
In case the long-term equity investment are made to obtain the equities of the merging enterprises which are not under the common
control, the consolidation cost determined according to ‘Accounting Standard for Business Enterprises No. 20 – Business
48
Combinations’ on the purchase date will be deemed as the initial investment cost.
② Other types of long-term equity investment
In case the long-term equity investment is made by cash payment, the actual payment amount will be deemed as the initial investment
cost.
In case the long-term equity investment is made by issuing the equity securities, the fair values of issued equity securities will be
deemed as the initial investment cost.
For the long-term equity investment made by the investors, the values agreed in the investment contracts or agreements (deducting the
cash dividends or profits that have been declared but have not been dismissed) will be deemed as the initial investment cost, except that
the contracts or agreements provide that the values are not fair.
In case the long-term equity investment is made by exchanging the non-currency assets, and this exchange has the commercial
substance and the fair values of exchanged assets can be reliably calculated, the fair values of assets surrendered will be deemed as the
initial investment cost, unless there is conclusive evidence that the fair values of assets received are more reliable; for exchange of
non-currency assets that do not satisfy the above conditions, the sum of book value of assets surrendered and relevant taxes payable will
be deemed as the initial investment cost.
In case the long-term equity investment is made by the mode of liability restructure, the fair values of the obtained equities will be
deemed as the initial investment cost.
(2) Subsequent measurement and profit & loss recognition
When the Company is able to exercise significant influence or joint control, the difference of cost of initial investment in excess of the
proportion of the fair value of the net identifiable assets in the invested companies is not adjusted against the initial cost of long-term
equity investment. The difference of cost of initial investment in short of the proportion of the fair value of the net identifiable assets in
the invested companies is charged into the current profit or loss statement. .
The Company’s long-term equity investments in subsidiaries are accounted for by the cost method and adjusted according to the equity
method when preparing consolidated financial statements. When the Company has neither joint control nor significant influence in the
invested companies, there is no quotation available on the active market, and the fair value of the investment cannot be reliably
measured, the long-term equity investment is accounted for under the cost method.
When the Company has joint control or significant influence over the invested companies, the long-term equity investment is accounted
for under the equity method.
For profit or loss of internal transactions occurred among the Company and joint ventures, the proportion attributable to the Company
will be calculated according to shareholdings and offset in the application of equity method.
Recognition of share of losses of the invested companies under the equity method is treated in the following steps: First, reduce the
book value of the long-term equity investment. Second, when the book value is insufficient to cover the share of losses, investment
losses are recognized up to a limit of book values of other long-term equity which form net investment in substance by reducing the
book value of long term receivables, etc. Finally, after all the above treatments, if the Company is still responsible for any additional
liabilities in accordance with the provisions stipulated in the investment contracts or agreements, estimated liabilities are recognized
and charged into current investment loss according to the liabilities estimated.
If the invested company achieve profit in subsequent periods, the treatment is in the reversed steps described above after deduction of
any unrecognized investment losses, i.e., reduce book value of estimated liabilities recognized, restore book values of other long-term
equity which form net investment in substance, and in long-term equity investment, and recognize investment income at the same time.
Treatment of other equity changes except for net profit or loss in the invested companies: For other equity changes except for net profit
or loss in the invested companies, if the proportion of investments remain unchanged, the Company calculates the proportion it shall
enjoy or bear and adjust book value of long-term equity investment, and increase or decrease capital reserves – other capital reserves
at the same time.
49
(3) Judgment criteria of joint control and significant influence in the invested companies
If, in accordance with provisions in the contracts, the Company enjoys joint control over certain economic activities only when taking
part in significant financial and operational decisions with investors in need of share of control who unanimously agree, the Company
is deemed to enjoy joint control with other parties over the invested companies. If the Company is authorized to take part in decision
making with regard to the financial and operational policies, but is unable to control or control jointly with other parties over the
invested company, the Company is deemed to be able to exercise significant influence over the invested companies.
(4) Impairment testing and impairment provision methods
(1) In case the cost method is used to calculate the long-term equity investments which are not quoted in the active market or whose fair
values cannot be reliably calculated, the depreciation loss will be determined based on the difference between the book values and
current values determined by the discounting of future cash flow in line with the current market return rate of similar financial assets.
(2) For other long-term equity investments, in case the calculation results of receivable amounts indicate that the receivable amount of
this long-term equity investment is less than their book values, the difference will be confirmed as the asset depreciation losses. Once
the depreciation loss of long-term equity investment is confirmed, they will not be reversed
13. Investment properties
Investment properties refer to properties held to earn rentals or for capital appreciation, or both, including leased land use right and
those held and ready to transfer after value added, and leased buildings.
The Company uses the cost model to measure existing investment properties. For investment properties and rental assets measured at
the cost model, they will be implemented the same depreciation policy similar to fixed assets, land use right for rental will be
implemented the same amortization policy to intangible assets; for those with the indication of impairment, the recoverable amount can
only be estimated, and if recoverable amount is lower than its book value, the corresponding impairment loss should be confirmed.
14. Fixed assets
(1) Recognition standard of fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of services, for rental to others, or for administrative
purposes; they have useful lives over one fiscal year. And they shall be recognized only when both of the following conditions are
satisfied:
① It is probable that economic benefits associated with the assets will flow to the enterprise; and
② The cost of the fixed assets can be measured reliably.
(2) Basis and valuation method of fixed assets by financing leasehold
Recording value of financing leasehold should be recognized as fair value of leasing assets and present value of lowest leasing payment
when leasing occurs whichever is lower. For fixed assets leased through finance lease, if it can reasonably determine that the ownership
of the leased assets will be obtained when the lease period expires, provision for depreciation will be made in useful life of leased assets;
if it can’t reasonably determine that the ownership of the leased assets will be obtained when the lease period expires, provision for
depreciation will be made in the lease period and useful life of leased assets, whichever is shorter.
Fixed assets renovations expenses that meet the criteria of capitalization are averagely amortized according to the period between the
two renovations, remaining lease period and the useful life of fixed assets, whichever is short.
(3) Depreciation method of fixed assets
Depreciation of fixed assets is provided for on a straight-line basis, the depreciation rate is recognized in accordance with category,
estimated useful life and estimated residual rate of fixed assets.
Fixed assets renovations expenses that meet the criteria of capitalization are depreciated on an individual basis over the interval of two
renovations or remaining useful life of the fixed assets, whichever is shorter (2-5 years). Individual depreciation by age average
50
method is adopted, as following:
Estimated net residual value
Category Estimated useful life (year) Annual depreciation rate (%)
rate (%)
Buildings and constructions 35 5% 2.71%
Machinery equipment 10 5% 9.5%
Electronics 8 5% 11.88%
Transportation equipment 5 5% 19%
(4) Impairment testing method and withdrawal of impairment provision for fixed assets
As for fixed assets, judgment is made to discern whether relating assets possibly encounter impairment at the period-end. If the assets
have sign of impairment, valuation is made to estimate its account receivables
① If assets have sign of impairment, the Company estimates its account receivables on the base of a single asset.
② If account receivables of a single asset are unable to be estimated, the Company confirms account receivables of asset group on
the base of the asset group to which the assets belong.
③ Account receivables are affirmed by the higher one of net amount of assets fair value deducting disposal costs and present value
of assets expected cash flow.
If amount receivables of assets are lower than book value, book value of assets shall be deductive to amount receivables among
which the deductive amounts are referred to as loss of assets impairment and marked into current loss with withdrawal of impairment
provision for relating assets.
Assets which is confirmed impairment would occur corresponding adjustment of depreciation of impairment assets or amortization
costs in a bid to make the assets methodically amortize and adjust book value (deducted expected net residual value) in the remaining
useful life.
Once assets impairment of fixed assets confirmed, there is not reversion in the future accounting period.
(5) Other notes
15. Construction in progress
(1) Classification of construction in progress
The Construction in progress will be calculated based on the classification of proposed projects.
(2) Transfer time of construction in progress to fixed assets
For the construction in progress, all expenses occurring before they are ready for the use will be the book values as the fixed assets. In
case the construction in progress has been ready for use but the final accounts for completion have not been handled, from the date
when such projects has been ready for use, the Company will evaluate the values and determine the costs based on the project budgets,
prices or actual costs of projects, etc and the depreciation amount will also be withdrawn; when the final accounts for completion are
handled, the Company will adjust the originally evaluated values subject to the actual costs, but will not adjust the withdrawn
depreciation amount.
(3) Impairment testing method and withdrawal of impairment provision for construction in progress
As for construction in progress, judgment is made to discern whether relating assets possibly encounter impairment at the period-end.
If the assets have sign of impairment, valuation is made to estimate its account receivables
① If assets have sign of impairment, the Company estimates its account receivables on the base of a single asset.
② If account receivables of a single asset are unable to be estimated, the Company confirms account receivables of asset group on
the base of the asset group to which the assets belong.
③ Account receivables are affirmed by the higher one of net amount of assets fair value deducting disposal costs and present value
51
of assets expected cash flow.
If amount receivables of assets are lower than book value, book value of assets shall be deductive to amount receivables among
which the deductive amounts are referred to as loss of assets impairment and marked into current loss with withdrawal of impairment
provision for relating assets.
Assets which is confirmed impairment would occur corresponding adjustment of depreciation of impairment assets or amortization
costs in a bid to make the assets methodically amortize and adjust book value (deducted expected net residual value) in the remaining
useful life.
Once assets impairment of fixed assets confirmed, there is not reversion in the future accounting period.
16. Borrowing expenses
(1) Confirmation principle of capitalization of borrowing expenses
In case the borrowing expenses occurring in the Company may directly be attributable to the construction and productions of assets
complying with the capitalization conditions, they will be capitalized and accrued to the relevant capital costs; other borrowing
expenses will be confirmed as the expenses based on the actual amount at the time of occurrence and accrued to the current profit or
loss.
The assets complying with the capitalization conditions mean the assets such as fixed assets, investment real estates and inventory, etc
that need a long time of construction and production activities before they are ready for use or for sales.
The borrowing expenses begin to be capitalized under the following circumstances:
The asset payment have been made which include the payment such as the paid cashes, transferred non-currency assets or borne
liabilities with the interests to construct or produce the assets complying with the capitalization conditions;
The borrowing expenses have occurred;
The necessary construction or production activities to make the assets ready for use or sales have been launched.
(2) Capitalization period of borrowing expenses
The capitalization period means the period from the moment that the borrowing expenses start to be capitalized to the moment that the
capitalization is stopped, which does not include the period that the capitalization of borrowing expenses is suspended.
(3) Suspending period of capitalization
In case during the construction or production period the assets complying with the capitalization conditions are abnormally suspended
and the suspension period exceeds 3 months continuously, the capitalization of borrowing expenses will also be suspended.
The capitalization of borrowing expenses for the assets that have been constructed or produced and are ready for use or sales will be
stopped.
When parts of the purchased assets or assets whose production satisfies the capitalization conditions are completed respectively and can
be used individually, the capitalization of the borrowing expenses of these parts will be stopped.
(4) Calculation method about capitalization amount of borrowing expenses
The interest expenses for special loans (after the deduction of interest income generated by the unused loan capitals or the investment
return obtained from the temporary investments) and auxiliary expenses will be capitalized before the assets complying with the
capitalization conditions are ready for the expected use or sales.
The interest amount of general loans to be capitalized will be determined by multiplying the weighted average amount of the asset
payment by which the accumulated assets exceed the special loans with the capitalization rate of general loans. The capitalization rate
will be determined based on the weighted average interest rate of general loans.
In case the loans have the discounts or premiums, the Company will adjust the interest amount in each period based on the amortized
discount and premium amount in each accounting period in accordance with the actual interest rate method.
52
17. Intangible assets
(1) Accounting method of intangible assets
When acquiring, the intangible assets are generally recorded according to actual cost.
① For those the price of intangible assets deferred paid exceed normal credit condition so substantively has financing character, the
cost of intangible assets is confirmed on the basis of present value of purchasing price.
② For fixed assets formed through obtaining them by the debtor paying for debt in debt restructure, recognize its recording value as
fair value of the fixed assets, and record the difference between the carrying amounts of debt restructure and the fixed assets used for
paying debt into current profit or loss; in the circumstance of the non monetary assets exchange has commercial nature and fair value
of surrendered or received assets can be measured reliably, recording value of received assets should be recognized as fair value of
surrendered assets unless there is clear evidence to indicate that fair value of received assets is more reliable; for non monetary assets
exchange which doesn’t meet the requirement of premise mentioned above, cost of received assets should be recognized as carrying
amount and related tax expenses payable of surrendered assets and should not be recognized as profit or loss.
③ Recording value of fixed assets obtained by absorbing and consolidated by enterprise under the common control should be
recognized as carrying amount of the consolidated party; recording value of fixed assets obtained by absorbing and consolidated by
enterprise under different control should be recognized as fair value.
(2) Estimation of useful life for intangible assets with finite useful life
At end of each year, the Company will recheck the useful life of intangible assets with the definite useful life and amortization method
will be rechecked.
According to the re-check, the useful life and amortization method of the intangible assets at the end of the year are not different from
those estimated before.
Item Expected useful life Foundation
(3) Judging foundation for intangible assets with infinite useful life
In case their useful life is limited, the intangible assets are amortized evenly over the period in which they produce economic profit for
the Company; in case it is impossible to evaluate the useful life when the intangible assets bring the benefits to enterprises, it will be
deemed that the useful life of such intangible assets is uncertain and amortization is not applicable.
(4) Withdrawal of impairment provision for intangible assets
For intangibles, the Company assesses whether signs of possible impairment exist at end of each year. Impairment tests are performed
on goodwill arises from business combinations and intangibles with uncertain useful life regardless of whether signs of possible
impairment exist.
For assets with signs of impairment, recoverable amounts are estimated:
① When there are signs of possible impairment on assets, the Company estimates the recoverable amount of the assets on an
individual basis.
② If it is not possible to estimate the recoverable amount of the individual asset, the Company shall determine the recoverable amount
of the asset group to which the asset belongs.
③ Recoverable amounts are determined as the fair value of the assets after netting off costs of disposal, and the current value of
projected future cash flows generated by the assets, whichever is higher.
When the recoverable amount of an asset is lower than the book value of the asset, the book value of the asset is reduced to its
recoverable amount. The amount reduced is recognized as impairment loss on assets in the current profit or loss statement, and
provision for impairment loss on assets is recorded at the same time.
Future depreciation or amortization of assets is adjusted after recognition of impairment loss so that the adjusted book value of the
assets (less estimated residual value) is amortized systematically over their remaining useful life.
53
Impairment loss on intangibles shall not be reversed once recognized.
(5) Specific standard of discerning researching stage and developing stage of development&research projects of the company
Inapplicable
(6) Expenses accounting of internal research&development project
Inapplicable
18. Long-term expenses to be amortized
Long-term expenses to be amortized will be averagely amortized in the benefit period, including:
(1) Prepaid rentals for operating leased fixed assets will be averagely amortized according to the term stipulated in the lease contract.
(2) Fixed assets improvement expenses for operating leased fixed assets will be averagely amortized according to the remaining lease
period and the useful life of leased assets, whichever is shorter.
21. Income
(1) Specific standard for the time of income from sale of goods
Revenue from the sale of goods is recognized when the enterprise has transferred to the buyer the significant risks and rewards of
ownership of the goods; the enterprise retains neither continuing managerial involvement to the degree usually associated with
ownership nor effective control over the goods sold; it is probable that the economic benefits associated with the transaction will flow
to the enterprise; and the relevant amount of revenue and costs can be measured reliably.
Real estate sales will be confirmed the realization of revenue thereof upon the complete and acceptance of real estate, meeting the
delivery terms of sales contract, and obtaining the proof of payment made by the purchasers according to the agreement under the
contract on delivering real estate (usually after receiving the first phase of sales contract payment and confirming the payment
arrangements of the remaining).
(2) Standard for income from use right of transferred assets
In case the economic benefits related to the transaction will probably flow into the enterprise and the income amounts can be reliably
calculated, the Company will determine the income amount about use right of transferred assets by the following means:
① The interest income amount will be calculated and determined based on the use time of currency capital from the Company by
others and actual interest rate.
② The income amount of use expenses will be calculated and determined subject to the charging time and method agreed in the
relevant contracts and agreements.
(3) Standard for income from rendering of service
In case on the preparation date of balance sheet the results about service transaction can be reliably evaluated, the labor income will be
confirmed by the completion percentage method. The completed percentage of service transactions is determined by the measurement
of finished work (or the proportion of services performed to date to the total services to be performed, or the proportion of costs
incurred to date to the estimated total costs).
The Company will determine the total amount of rendering of service based on the prices in contracts and agreements that have been
received or will be receivable, except that such prices are not fair. On the balance sheet date, the current labor incomes will be
determined based on the amount after the total labor income amount multiplied by the completion progress deducts the accumulated
labors in the past accounting periods. At the same time, the current labor incomes will be carried forward based on the amount after the
estimated total labor cost multiplied by the completion progress deducts the accumulated labors in the past accounting periods.
In case the service transaction results on the preparation date of balance sheet cannot be reliably evaluated, they will be determined in
the following methods:
54
① In case the service costs that have occurred can be compensated, the service income will be confirmed based on such service costs
and the same amounts will be settled as the service costs.
② In case the service costs that have occurred cannot be compensated, such service costs will be accrued to the current profit or loss
and will not be confirmed as the service costs.
(4) When confirming income from rending services and constructing contracts according to completion percentage, confirm the
methods and progresses of completion of contract
Inapplicable
20. Government grants
(1) Categories
Government grants refer to monetary assets or non-monetary assets obtained free by a company from the government, but not include
the capital invested by government as a business owner. Government grants are classified to government grants related to assets and
government grants related to income.
(2) Accounting methods
Government grants related to assets are recognized as deferred income and are averagely distributed in the life of relevant assets, and
recorded to current profit or loss. Government grants related to income are handled under the following circumstances:
① If such grants are used to compensate for relevant costs and losses of the company during later periods, they will be recognized as
deferred income and recorded to current profit or loss upon recognizing related costs;
② If such grants are used to compensate for relevant costs and losses occurred of the company, they will be directly through current
profit or loss.
21. Deferred income tax assets / deferred income tax liabilities
(1) Foundation of affirmation of deferred income tax assets
Corporate income tax will be calculated by liability method of the balance sheet.
The company’s tax base will be determined upon the company obtains the assets or liabilities; on the balance sheet date, take the
balance sheet as the basis, and if the book value of related assets or liabilities are different to the tax bases provided by tax laws, it will
calculate and confirm the deferred income tax assets or deferred income tax liabilities occurred in accordance with the provisions of tax
laws, which effect will be included in current income tax expense.
The company is subject to the limit of the amount of taxable income likely to be used to offset temporary difference, thus confirms the
deferred income tax asset produced by the deductible temporary difference.
(2) Foundation of affirmation of deferred income tax liabilities
In addition to the cases specified under income guidelines that no need to confirm the deferred income tax liabilities, the company
should recognize related deferred income tax liabilities for all taxable temporary differences.
22. Operating lease and finance lease
(1) Accounting treatment of operating lease
If the terms of the lease will be transferred to the lessee substantially together with all the risks and rewards related to the ownership of
leased assets, then the lease is a finance lease, and other lease is operating lease.
For rent in operating lease, the Company will use the straight-line method to recognize profit or loss in each period during the lease term.
Initial direct costs occurred will be through current profit or loss.
For rent in operating leases, the Company will use the straight-line method to record it into the cost of relevant assets or current profit
55
or loss in each period during the lease term; and initial direct costs occurred will be through current profit or loss.
Rent in operating leases will be recorded into the cost of relevant assets or current profit or loss in each period during the lease term.
(2) Accounting treatment of finance lease
n finance lease, at the lease beginning date, the Company takes the minimum lease receipt and the initial direct costs as the entry value
of finance lease receivable, and records the unguaranteed residual value; and the difference between the sum of minimum lease receipt,
initial direct costs and unguaranteed residual value and its present value is recognized as unrealized finance income. For unrealized
finance income each period during the lease term, it will use the effective interest method to confirm the current financing income.
In finance lease, at the lease beginning date, the Company will take the lower of the fair value of the leased assets and the present value
of minimum lease payment as the entry value of leased assets, and take the minimum lease payment as the entry value of long-term
payables, and their difference will be as unrecognized finance cost. Initial direct costs are included in the value of leased assets. For
unrecognized finance income each period during the lease term, it will use the effective interest method to confirm the current financing
cost.
The Company uses depreciation policy consistent with its own fixed assets to make provision for depreciation of leased assets.
(3) Accounting treatment of leaseback
Inapplicable
(V) Taxation
1. Main type of tax and tax rate of the Company
Type of tax Tax rate Taxable basis
VAT 17% Revenue of product
Business tax 5% Rental income
City construction and maintainance tax 7% 5% VAT, business tax
Enterprise income tax 25% Taxable income
[incrementtaxonlandvalue 3.5% Income in advance
Income tax rate of the company and branches
(1) The Company implements the uniform tax rebate policy of export, i.e. the export is exempt from VAT and the input-VAT of goods
is refunded with refund rate according to relevant rules before export in accordance with the requirements of tax law.
(2) Since 1 Jan. 2008, other subsidiaries of the Company has adopted the applicable income tax rate of 25%, except for those company
established in the below-mentioned districts.
Companies established in Shenzhen Special Economic Zone are entitled to preferential enterprise income tax policy during five-year
transitional period, i.e. since 1 Jan. 2008, applicable enterprise income tax rate of 18%, 20%, 22%, 24% and 25% are adopted from
2008 to 2012 respectively.
Companies established in Hong Kong SAR are entitled to a profits tax rate of 16.5%.
2. Tax preference and official document
Inapplicable
3. Other notes
56
(VI) Business combination and the consolidated financial statements
1. Status of subsidiaries
The Company adopts the Accounting Policies for Business Enterprises No. 33 – Consolidated Financial Statements issued in Feb. 2006.
All subsidiaries under the Company’s control and main body with special objectives are included in the scope of consolidation.
The consolidated financial statements are prepared by the parent company based on the individual financial statements of the parent
company as well as the subsidiaries included in the scope of consolidation, with reference made to other relevant information and after
adjustment to the long-term investments in subsidiaries’ equity under equity method. The internal equity investment and the owner’s
equity of subsidiaries, internal investment income and profit distribution of subsidiaries, internal transactions, internal claims and
liabilities will be offset upon consolidation.
The accounting policies adopted by subsidiary and parent company are consistent. (If they are not consistent, a necessary adjustment
shall be made to the financial statements of subsidiary in accordance with the accounting policy of parent company when the
consolidated financial statements are prepared.)
Unless otherwise specified, the unit of data listed in this section is RMB10,000
(1) Subsidiaries obtained through the establishment or investment
Unit: RMB Yuan
Balance
of the
owner's
equity
of
parent
compan
y after
deductin
g the
Balance share of
Register of net current
Actual Minorit Gains &
ed investm losses of
Place of investm Shareho Consoli y losses of
capital Scope of ent in Voting minority
Name Type Registra Nature ent as at ldings dated or sharehol minority
(10 business subsidia (%) sharehol
tion period (%) not ders’ sharehol
thousan ries in ders
end equity ders
d) substanc over the
e share of
owner’s
equity
enjoyed
by such
minority
sharehol
ders in
the
subsidia
ry in the
57
period
beginni
ng
Investm
Shenzhe
ent and
n Rieys
Co., Shenzhe import 45,000, 4,359,5 36,075.
Industri Trading 5000 0.00 90 90 Yes
Ltd. n & 000.00 08.59 97
al Co.,
export
Ltd.
trading
Puning Producti
Tianhe on and
Garmen sales of
65,100,
t Co., Manufa 6510(H clothes
Puning 000.00( 0.00 100 100 Yes
Manufa Ltd. cture KD) and
HKD)
cturing knitting
Factory colorize
. d cloth
Shenzhe
n
Municip
Yingdac
al public
haungyu
project
an Shenzhe Real
Co., Ltd 1.00 and real 1.00 0.00 100% 100% Yes
construc n estate
estate
ting and
develop
Manufa
ment
cturing
Co., Ltd
Other notes about subsidiaries obtained through the establishment or investment
(2) Subsidiaries obtained through business consolidation under common control
Unit: RMB Yuan
Balance
of the
owner's
Balance
Register equity of
Actual of net Gains &
ed parent
Place of investm investmen Sharehold Minority losses of
capital Scope of Voting Consolida company
Name Type Registra Nature ent as at t in ings sharehold minority
(10 business (%) ted or not after
tion period subsidiari (%) ers’ equity sharehold
thousan deducting
end es in ers
d) the share
substance
of current
losses of
minority
58
sharehold
ers over
the share
of
owner’s
equity
enjoyed
by such
minority
sharehold
ers in the
subsidiary
in the
period
beginning
Tianrui
(HK) Hong
Co., Ltd. Trading 1(USD) Trading 1(USD) 0.00 100 100 Yes
Trading Kong
Co., Ltd.
Property
Puning developm
Hengda ent
Real Property (operate
146,600,0
Estate Co., Ltd. Puning developm 2600 with valid 0.00 100 100 Yes
00.00
Developm ent qualificati
ent Co., on
Ltd. certificate
)
Other notes about subsidiaries obtained through business consolidation under common control
(3) Subsidiaries obtained through business consolidation not under common control
Unit: RMB Yuan
Balance
of the
owner's
Balance
equity of
Actual of net Gains &
Registere parent
Place of investmen investmen Sharehold Minority losses of
d capital Scope of Voting Consolida company
Name Type Registrati Nature t as at t in ings sharehold minority
(10 business (%) ted or not after
on period subsidiari (%) ers’ equity sharehold
thousand) deducting
end es in ers
the share
substance
of current
losses of
minority
59
sharehold
ers over
the share
of
owner’s
equity
enjoyed
by such
minority
sharehold
ers in the
subsidiary
in the
period
beginning
Other notes about subsidiaries obtained through business consolidation not under common control
2. Notes about change in scope of consolidation
Notes about change in scope of consolidated statement
Shenzhen Yingdachuangyuan Construction and Investment Co., Ltd. was established through investment with registered capital of
1.00 RMB and ratio of investments of 100%.
√ Applicable □ Inapplicable
Compared to last year, this year increased one consolidated unit, for
Establishing Shenzhen Yingdachuangyuan Construction and Investment Co., Ltd. through investment
Compared to last year, this year decreased consolidated unit, for
3. Subjects newly included in current scope of consolidation and subjects no longer included in current scope of consolidation
Subsidiaries, subjects with special purposes and business entities which controlling right is formed by entrusted operation or lease
newly included in current scope of consolidation
Unit: RMB Yuan
Name Net assets at the period-end Net profit in current period
Shenzhen Yingdachuangyuan Construction and
1 0
Investment Co., Ltd
(VII) Notes to the items of consolidated financial statement
1. Monetary funds
Unit: RMB Yuan
Closing balance Opening balance
Item Exchange Exchange
Foreign currency Equivalent to RMB Foreign currency Equivalent to RMB
rate rate
60
Cash -- -- 881,012.77 -- -- 693,705.81
RMB -- -- 880,947.80 -- -- 693,639.60
USD 1.00 6.1787 6.18 1.00 6.2855 6.29
HKD 73.80 0.7965 58.79 73.80 0.8109 59.84
Bank deposits -- -- 23,167,363.53 -- -- 20,841,826.88
RMB -- -- 23,096,008.69 -- -- 20,746,442.44
USD 4,041.88 6.1787 24,973.50 10,044.64 6.2855 63,135.59
HKD 58,228.19 0.7965 46,381.27 39,771.66 0.8109 32,248.85
Other currency -- -- 17,890.99 -- -- 19,960.10
RMB -- -- 17,890.99 -- -- 19,960.10
Subtotal -- -- 24,066,267.29 -- -- 21,555,492.79
If there is any item which is restricted, outbound and has potential risks to withdraw because of mortgage, pledge and freeze,
individual note is needed.
Note: The number of monetary funds at period-end is more than the period-begin by RMB2,510,774.50, representing a change ratio of
11.65%, the reasons for the change is due to receiving the prepayment of houses from Puning Hengda Real Estate Company in this
period.
2. Accounts receivable
(1) Disclosure of accounts receivable by category
Unit: yuan
Closing balance Opening balance
Book value Provision for bad debts Book value Provision for bad debts
Category
Proportion( Proportion( Proportion( Proportion(%
Amount Amount Amount Amount
%) %) %) )
Accounts receivable with
significant individual 12,102,904. 12,102,904. 12,195,09 12,195,097.2
35.89% 100% 24.08% 100%
amount which individually 62 62 7.21 1
assessed for bad debts
Accounts receivable of provision for bad debts withdrawing by groups
Accounts receivable with
insignificant individual
15,750,977. 8,362,533.8 31,755,09
amount but in high risk 46.71% 53.09% 62.71% 8,362,533.80 26.33%
38 0 5.07
portfolio after grouping by
credit risk characteristics
Accounts receivable with 5,655,033.3 6,484,327
16.77% 334,828.73 5.92% 12.8% 334,828.73 5.16%
significant individual 3 .79
61
amount in high risk
portfolio after grouping by
credit risk characteristics
21,406,010. 8,697,362.5 38,239,42
Subtotal 63.49% 40.63% 75.51% 8,697,362.53 22.74%
71 3 2.86
Accounts receivable with
insignificant individual
206,357.7
amount but withdrawing 206,357.74 0.61% 206,357.74 100% 0.41% 206,357.74 100%
4
by individual for provision
for bad debts
33,715,273. 21,006,624. 50,640,87 21,098,817.4
Total -- -- -- --
07 89 7.81 8
Notes of the category of accounts receivable
Accounts receivable with significant individual amount which individually assessed for bad debts at the end of the period
√ Applicable □ Inapplicable
Unit: yuan
Withdrawing
Contents of accounts receivable Book value Provision for bad debts Proportion Reason of provision
(%)
The significant client ha
d filed for bankruptcy a
nd had significant influe
Victoria International(USA) INC 5,333,617.39 5,333,617.39 100%
nce on it. It’ likely to
have bad debts after ana
lysis and evaluation
Payment for a long time
Hongkong Jinhua Trading Company 4,224,304.63 4,224,304.63 100% with final payment
disputable
Payment for a long time
Jinjing International Co., Ltd. 2,544,982.60 2,544,982.60 100% with final payment
disputable
Total 12,102,904.62 12,102,904.62 -- --
In the groups, the accounts receivable of provision for bad debts withdrawing by aging analysis
√ Applicable □ Inapplicable
Unit: yuan
Closing balance Opening balance
Aging
Book value Provision for bad Book value Provision for bad
62
Proportion( debts Proportion( debts
Amount Amount
%) %)
Within 1 year
Including -- -- -- -- -- --
Subtotal 9,722,495.44 45.42% 549,753.04 27,487,652.14 71.88% 549,753.04
1 to 2 years 1,259,589.88 5.88% 256,427.72 2,564,277.18 6.71% 256,427.72
2 to 3 years 2,395,147.54 11.19% 197,567.97 395,135.93 1.03% 197,567.97
over 3 years 7,792,357.61 20.38% 7,693,613.80
3 to 4 years 236,420.24 1.1%
over 5 years 7,792,357.61 36.4% 7,693,613.80
Total 21,406,010.71 8,697,362.53 38,239,422.86 -- 8,697,362.53
In the groups, the accounts receivable of provision for bad debts withdrawing by the balance percentage method
□ Applicable √ Inapplicable
In the groups, the accounts receivable of provision for bad debts withdrawing by other methods
□ Applicable √ Inapplicable
Accounts receivable with insignificant individual amount but withdrawing by individual for provision for bad debts at the
end of period
√ Applicable □ Inapplicable
Unit: yuan
Contents of accounts Withdrawing proportion
Book value Provision for bad debts Withdrawing reason
receivable (%)
Shenzhen ITAT Estimated to be
International Premier 206,357.74 206,357.74 100% irrecoverable for long
Brand Membership Store age
Total 206,357.74 206,357.74 -- --
(2) Accounts receivable with insignificant individual amount but in high risk portfolio after grouping by
credit risk characteristics
Aging Closing balance Opening balance
Provision for bad debts Provision for bad
debts
Total 15,750,977.38 100.00% 8,362,533.80 31,755,095.07 100.00% 8,362,533.80
63
(3) Top 5 units in outstanding amount of accounts receivable
Unit: yuan
Percent in total accounts
Name of unit Relationship Amount Age limit
receivable (%)
Victoria
Customer 5,333,617.39 over 3 years 15.82%
International(USA) INC
Hongkong Jinhua
Customer 4,224,304.63 over 3 years 12.53%
Trading Company
Huang Donglai Customer 3,298,712.00 1 to 2 years 9.78%
Jinjing International Co.,
Customer 2,544,982.60 over 3 years 7.55%
Ltd.
Brendwood International
Customer 2,356,321.33 1 to 2 years 6.99%
Corp.
Total -- 17,757,937.95 -- 52.67%
3. Other receivables
(1) Disclosure of other receivables by category
Unit: yuan
Closing balance Opening balance
Book value Provision for bad debts Book value Provision for bad debts
Category
Proportio Proportio Proportion( Proportio
Amount Amount Amount Amount
n(%) n(%) %) n(%)
Accounts receivable with
significant individual
amount which 1,000,000.00 100% 1,000,000.00 100% 1,000,000.00 3.16% 1,000,000.00 100%
individually assessed for
bad debts
Other accounts receivable of provision for bad debts withdrawing by groups
Other receivables with
insignificant individual
amount but in high risk 26,496,734.7 19,389,821.7 25,432,987.0
80.45% 80.45% 19,389,821.78 76.24%
portfolio after grouping 1 8 3
by credit risk
characteristics
Other accounts
20,500.00 0.06% 20,500.00 20,500.00 0.06% 20,500.00 100%
receivable not significant
Accounts receivable with 13,242,022.6 16.33% 2,493,353.00 100% 5,163,106.00 16.33% 2,493,353.00 48.29%
64
significant individual 7
amount in high risk
portfolio after grouping
by credit risk
characteristics
39,759,257.3 21,903,674.7 30,616,593.0
Subtotal 21,903,674.78
8 8 3
40,759,257.3 22,903,674.7 31,616,593.0
Total -- -- -- 22,903,674.78 --
8 8 3
Notes of the category of other receivables
Other accounts receivable with significant individual amount which individually assessed for bad debts at the end of the
period
√ Applicable □ Inapplicable
Unit: yuan
Withdrawing proportion
Contents Book value Amount of bad debts Reason
(%)
STRICKWELT
INTERNATIONAL Estimated to be
TRADING 1,000,000.00 1,000,000.00 100% irrecoverable for long
(SHANGHAI) CO., age
LTD.
Total 1,000,000.00 1,000,000.00 -- --
In the groups, the other accounts receivable of provision for bad debts withdrawing by aging analysis
√ Applicable □ Inapplicable
Unit: yuan
Closing balance Opening balance
Book value Book value
Aging Provision for bad Provision for bad
Proporti Proporti
Amount debts Amount debts
on(%) on(%)
Within 1 year
Including:
Subtotal
Within 1 year 10,856,106.26 27.32% 19,747.95 987,397.85 3.23% 19,747.95
1 to 2 years 1,185,070.79 2.98% 167,402.45 2,772,024.53 9.05% 277,202.45
2 to 3 years 4,850,289.11 12.21% 1,502,321.32 5,899,748.64 19.27% 2,949,874.32
over 3 years 20,957,422.01 68.45% 18,656,850.06
3 to 4 years 6,226,601.14 15.67% 4,045,280.91
4 to 5 years 5,397,346.96 13.58% 4,317,877.57
65
over 5years 11,223,343.12 28.24% 9,337,191.58
Total 39,738,757.38 -- 19,389,821.78 30,616,593.03 -- 21,903,674.78
In the groups, other accounts receivable of provision for bad debts withdrawing by the balance percentage method
□ Applicable √ Inapplicable
In the groups, other accounts receivable of provision for bad debts withdrawing by other methods
□ Applicable √ Inapplicable
Other accounts receivable with insignificant individual amount but withdrawing by individual for provision for bad debts in
the end of period
√ Applicable □ Inapplicable
Aging Closing balance Opening balance
Provision for bad Provision for bad
debts debts
Total 26,496,734.71 100.00% 19,389,821.78 25,432,987.03 100.00% 19,389,821.78
(2) Notes of Top 5 in outstanding amount of other receivables
Unit: yuan
Percent in total other
Name of unit Relationship Amount Age limit
accounts receivable (%)
Puning Huafengqiang
Customer 9,354,916.67 Within 1 year 22.95%
Trade Co., Ltd.
Puning Shenglilai Sewing
Customer 1,717,106.00 2 to 3 years 4.21%
Machine Co., Ltd.
Puning Zhongxinglian
Supplier 1,170,000.00 over 3 years 2.87%
Textile Co., Ltd.
Puning Lixiangcheng
Supplier 1,000,000.00 over 3 years 2.45%
Clothing Co., Ltd.
STRICKWELT
INTERNATIONAL
Supplier 1,000,000.00 over 3 years 2.45%
TRADING
(SHANGHAI) CO.,
66
LTD.
Total -- 14,242,022.67 -- 34.93%
Prepayment
(1) Prepayment presented
Unit: yuan
Closing balance Opening balance
Aging Proportion Proportion
Amount Amount
(%) (%)
Within 1 year 30,909,821.90 100% 330,540.90 23.59%
1 to 2 years 1,070,584.00 76.41%
Total 30,909,821.90 -- 1,401,124.90 --
Notes of prepayment by aging
(2) Top 5 in prepayment
Unit: yuan
Name of unit Relationship Amount Years Pending reasons
Guangsha Construction
In the period of contract
Group Co., Ltd. Builder 16,961,681.00 2013
execution
(Shenzhen Branch)
Puning Lailisheng Trade In the period of contract
Supplier 13,200,000.00 2013
Co., Ltd. execution
Jiangmen Quantai
In the period of contract
Optoelectronics Supplier 300,000.00 2013
execution
Technology Co., Ltd.
Guangzhou Runhong In the period of contract
Supplier 250,000.00 2013
Construction Co., Ltd. execution
Shenzhen Baoan District
Songgang In the period of contract
Supplier 180,750.00 2013
Wenchangshun execution
glass business
Total -- 30,892,431.00 -- --
Notes of prepayment of the major units
67
(3) Notes of prepayment
5. Inventories
(1) Category
Unit: yuan
Closing balance Opening balance
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Completed
development 274,250,611.88 274,250,611.88 340,802,511.47 340,802,511.47
products
Total 274,250,611.88 274,250,611.88 340,802,511.47 340,802,511.47
6. Fixed assets
(1) Notes of fixed assets
Unit: yuan
Opening book Decrease in the
Item Increase in the period Closing book value
value period
1. Total of book value: 128,124,055.35 484,642.71 1,562,867.00 127,045,831.06
Including: Buildings and
119,088,227.16 119,088,227.16
constructions
Machinery
1,579,481.00 1,412,800.00 166,681.00
equipment
Transportation
5,916,535.33 462,768.15 129,367.00 6,249,936.48
equipment
Office equipment and others 1,539,811.86 21,874.56 20,700.00 1,540,986.42
Newly increase
Opening book Withdrawing in the Decrease in the Ending balance in
-- in the period
value period period the period
2 Total of accumulated
39,802,370.08 2,289,996.49 1,022,008.82 41,070,357.75
depreciation:
Including: Buildings and
35,494,687.18 1,753,976.40 7,521.42 37,241,142.16
constructions
Machinery
925,300.74 56,155.38 924,246.26 57,209.86
equipment
Transportation 2,668,105.49 338,690.60 72,970.83 2,933,825.26
68
equipment
Office equipment and others 714,276.67 141,174.11 17,270.31 838,180.47
Opening book Ending balance in
-- --
value the period
3. Total of carrying amount
88,321,685.27 -- 85,975,473.31
of fixed assets
Including: Buildings and
83,593,539.98 -- 81,847,085.00
constructions
Machinery
654,180.26 -- 109,471.14
equipment
Transportation
3,248,429.84 -- 3,316,111.22
equipment
Office equipment and others 825,535.19 -- 702,805.95
4. Total of Depreciation
476,513.68 -- 0.00
reserves
Machinery
473,301.24 -- 0.00
equipment
Office equipment and others 3,212.44 -- 0.00
--
5. Total of carrying amount
-- 85,975,473.31
of fixed assets
Including: Buildings and
83,593,539.98 -- 81,847,085.00
constructions
Machinery
180,879.02 -- 109,471.14
equipment
Transportation
3,248,429.84 -- 3,316,111.22
equipment
Office equipment and others 822,322.75 -- 702,805.95
The current depreciation is RMB 1,753,976.40; the cost price of the fixed assets transferred from construction in progress is
yuan.
(2) Fully depreciated fixed assets still in use
Category Book value accumulated net book value
depreciation
Transportation equipment 620,000.00 589,000.00 31,000.00
Office equipment and others 23,512.00 22,336.40 1,175.60
643,512.00 611,336.40 32,175.60
69
(3) Office equipment and others
Category Book value accumulated depreciation net book value
Buildings and constructions 49,454,692.66 13,069,831.59 36,384,861.07
Machinery equipment 19,588,012.10 18,608,611.49 979,400.61
Total 69,042,704.76 31,678,443.08 37,364,261.68
7. Project materials
Unit: yuan
Increase in the Decrease in the
Item Opening balance Closing balance
period period
Gravel and others 54,526.00 54,260.00
Total 54,526.00 54,526.00
Notes of Project materials
8. Intangible assets
(1) Notes of intangible assets
Unit: yuan
Item Opening Book value Increase in the period Decrease in the period Closing book value
1. Total of book value 34,032,531.00 34,032,531.00
Land use right 33,659,416.00 33,659,416.00
Computer software 373,115.00 373,115.00
2. Total of accumulated
6,312,353.67 336,594.12 6,648,947.79
amortization
Land use right 5,939,238.67 336,594.12 6,275,832.79
Computer software 373,115.00 373,115.00
3. Total of carrying amount
27,720,177.33 -336,594.12 27,383,583.21
of intangible assets
Land use right 27,720,177.33 -336,594.12 27,383,583.21
Computer software 0.00 0.00
Fourth. Total of depreciation
0.00 0.00 0.00
reserves
70
Land use right 0.00 0.00
Computer software 0.00 0.00
Total of carrying amount of
27,720,177.33 -336,594.12 27,383,583.21
intangible assets
Land use right 27,720,177.33 -336,594.12 27,383,583.21
Computer software
Amortization of the period is yuan.
9. Deferred income tax assets and deferred income tax liabilities
(1) Presentation of the net value not to offset of the deferred income tax assets and the deferred income tax
liabilities
Recognized deferred income tax assets and deferred income tax liabilities
Unit: yuan
Item Closing balance Opening balance
Deferred income tax assets:
Provision for impairment of assets 8,577,402.80 8,577,402.80
Subtotal 8,577,402.81 8,577,402.81
Deferred income tax liabilities:
Notes of unrecognized deferred income tax assets
Unit: yuan
Item Closing balance Opening balance
Deductible temporary difference 1,094,388.32 1,094,388.32
Total 1,094,388.32 1,094,388.32
The deductible losses of the unrecognized deferred income tax assets due to the following years
Unit: yuan
Years Closing balance Opening balance Notes
List of Taxable differences and deductible differences projects
Unit: yuan
Amounts of temporary differences
Item
Ending Opening
Items of taxable differences
Items of deductible differences
71
(2) Presentation of the net value offset of the deferred income tax assets and the deferred income tax
liabilities
Components items of deferred income tax assets and liabilities after mutual set-off
Unit: yuan
Deductible or taxabl Deferred income tax Deductible or taxable
Deferred income tax
e temporary differen assets or liabilities temporary
assets or liabilities
Item ces after mutual set after mutual set-off at differences after
after mutual set-off at
-off at the end of t the opening of the mutual set-off at the
the end of the period
he period period opening of the period
Deferred income tax assets 8,577,402.81 8,577,402.81
Notes of deferred income tax assets and the deferred income tax liabilities
Unit: yuan
Item Amounts of the mutual set-off in the period
Notes of deferred income tax assets and the deferred income tax liabilities
(3) Temporary differences corresponding to assets or liabilities causing temporary differences
Item Amounts of temporary differences
Provision for impairment 34,309,611.24
Loss remediable
Total 34,309,611.24
10. Notes of impairment assets
Unit: yuan
Opening book Increase in the Decrease in the period Closing book
Item
balance period Reversal Written off balance
1. Provision for bad debts 44,002,492.26 92,192.59 43,910,299.67
2. Fixed assets depreciation
476,513.68 476,513.68 0.00
reserves
3. Intangible assets
0.00 0.00 0.00
depreciation reserves
Total 44,479,005.94 92,192.59 476,513.68 43,910,299.67
Notes of asset impairment details
72
11. Short-term loan
(1) Category
Unit: yuan
Item Closing balance Opening balance
Mortgaged loan 14,099,960.00 15,099,960.00
Total 14,099,960.00 15,099,960.00
Notes of the category of short-term loan
Guarantor Guarantee Debit bank Loan balance Warranty due Guarantee has
(ten thousand date been fulfilled
yuan)
Chen Hongcheng, Chen Xuewen, Guangdong Rieys China Everbright Bank, 1409.996 27 Sep 2009 No
Ding Lihong,Dongguan Jingjing Group Company Guangzhou Branch
Weaving Co., Ltd., Puning Ltd.
Shenghengchang Trade
Development Co., Ltd., Puning
Tianhe Knitting Garment Co.,
LTD., Shantou Lianhua Industiral
Ltd., Shenzhen Rieys Group
Company Ltd., Shenzhen Risheng
Chuanghuan Asset Management
Co., Ltd., Shanghai Hongyi
Properties Co., Ltd..(Notes)
(2) Notes of expired but unpaid short-term loans
Unit: yuan
Unit Amount Interest rate Purpose Overdue reason Expected repay date
China Everbright
Borrow the new to
Bank, Guangzhou 14,099,960.00 12.33% Financial difficulty
pay the old
Branch
Total 14,099,960.00 -- -- -- --
Amount of the balance sheet which has been repaid in future is yuan.
Notes of short-term loan, including expired short-term loan which had been allowed for extension, and notes of the extension
requirements and the new due date.
The Company had repaid the entire principal amount of overdue loans about RMB 15,600,000 to China Everbright Bank,
Guangzhou Branch in 4th July, 2013. As of the date hereof, the Company had no other bank loan.
73
12. Accounts payable
(1) Notes of accounts payable
Unit: yuan
Item Closing balance Opening balance
Within 1 year 15,538,828.76 30,387,537.73
1 to 2 years 330.00 8,326.90
2 to 3 years 24,331.30 363,281.74
over 3 years 465,123.69 118,176.34
Total 16,028,613.75 30,877,322.71
13. Deposit received
(1) Notes of deposit received
Unit: yuan
Item Closing balance Opening balance
Within 1 year 9,936,245.00 28,451,015.24
1 to 2 years 11,852,625.77 85,283.00
2 to 3 years 85,283.00
over 3 years 39,821.24 39,821.24
Total 21,913,975.01 28,576,119.48
14. Payroll payable
Unit: yuan
Item Opening book value Increase in the period Decrease in the period Closing book value
1. Salaries and
wages, bonus,
645,621.09 2,638,595.88 2,727,663.42 556,553.55
allowance and
subsidies
2. Employee welfare 84,840.76 14,739.40 70,101.36
3. Social insurance 176,082.02 176,082.02
4. Housing welfare
30,192.80 30,192.80
fund
Total 730,461.85 2,844,870.70 2,948,677.64 626,654.91
In payroll payable, the amount in arrears is RMB 0.
74
The amount of the labour union expenditure and the personnel education fund is RMB 0. The
amount of compensation for termination of labor relations is RMB 0.
The Expected issue time and the amount of payroll payable has not been decided.
15. Taxes payable
Unit: yuan
Item Closing balance Opening balance
VAT -18,460.17 562,009.27
Business Tax 14,568,487.79 14,906,947.44
Enterprise Income Tax 11,880,090.31 15,267,403.16
Land Appreciation Tax 10,038,196.47 10,456,652.35
Others 2,812,054.68 3,586,961.30
Total 39,280,369.08 44,779,973.52
Notes of taxes payable, if local tax authorities allowed that, the income tax payable between each
branch office and branch plant could supplement each other, should state the tax calculation
process
16. Interest payable
Unit: yuan
Item Closing balance Opening balance
Short-term loan interest 15,576,401.18 13,756,401.18
Total 15,576,401.18 13,756,401.18
Notes
1）Interest payable is loan interest overdue to financial institutions, the amount of the closing balance increase RMB
1,820,000.00 than the that of the opening balance , representing an increase ratio of 13.23% , the reason for the change is: the
interest that should be paid to the China Everbright Bank, Guangzhou Branch between Jan and Jun in 2013 had been
withdrew.
17. Other payables
(1) Notes
Unit: yuan
Item Closing balance Opening balance
Within 1 year 3,095,519.95 27,168,158.64
1 to 2 years 550,051.52 3,813,448.99
2 to 3 years 3,303,471.14 790,825.00
over 3 years 583,402.95 1,043,785.46
75
Total 7,532,445.56 32,816,218.09
(2) Notes of large amount of other payable
18. Non-current liability due within one year
19. Share capital
Unit: yuan
Increase(+) decrease(－)
Opening Closing
New issue of Accumulation
balance Present shares Others Subtotal balance
shares fund turn
Sum of shares 318,600,000.00 0.00 0.00 0.00 0.00 0.00 318,600,000.00
20. Capital reserve
Unit: yuan
Item Opening balance Increase in the period Decrease in the period Closing balance
Share capital premium 52,129,496.58 52,129,496.58
Total 52,129,496.58 52,129,496.58
Notes
21. Surplus reserve
Unit: yuan
Item Opening balance Increase in the period Decrease in the period Closing balance
Statutory Surplus Reserves 49,036,260.20 0 0 49,036,260.20
Discretionary surplus reserves 37,000,000.00 0 37,000,000.00
Total 86,036,260.20 0 0 86,036,260.20
Notes of surplus reserve, if converted the surplus reserve into equity, or to use to cover the deficit, and to distribut
e dividends, should state the relevant agreement.
22. Generic risk reserve
Notes
23. Retained profit
Unit: yuan
Proportion of extract or
Item Amount
distribution
76
Undistributed profit at the end of previous year
-101,152,252.70 --
before adjustment
Total undistributed profit at beginning of
-101,152,252.70 --
adjustment year
Increase：Net profit attributable to owner of parent
7,184,645.02 --
company this year
Undistributed profit at the end of the period -93,967,607.68 --
Notes of undistributed profit at the opening of the year before adjustment:
1). Because of the retroactive adjustment of Accounting Standards for Enterprises and its relevant new regulations,
the undistributed profit at beginning of the year is RMB 0.
2). Because of the changes in accounting policies, the undistributed profit at beginning of the year is RMB 0.
3). Because of the correction of big accounting errors, the undistributed profit at beginning of the year is RMB 0.
4). Because of the changes in consolidation scope led by the same control, the undistributed profit at beginning of t
he year is RMB 0.
5). Because of the total of other adjustments, the undistributed profit at beginning of the year is RMB 0.
Notes of retained profit, for those companies which offered securities in public for the first time, if the pre-released
accumulated profits had been decided to be shared by the new and old shareholders through the general meeting of
stockholders, should state clear; if the pre-released accumulated profits had been decided to be distributed before issue
and to be shared by the old shareholders through the general meeting of stockholders, the Company should clearly
disclose the audited profit number of the dividends payable held by the old shareholders.
24. Operating revenue and operating cost
(1) Operating revenue and operating cost
Unit: yuan
Item Occurred in current period Occurred in previous period
Income from main operations 101,392,043.00 7,617,917.19
Cost of operations 66,551,899.59 5,242,728.04
(2) Main operations (by industry)
Unit: yuan
Occurred in current period Occurred in previous period
Industry
Operating revenue Operating cost Operating revenue Operating cost
Real estate 101,392,043.00 66,551,899.59 0.00 0.00
Fashion industry 0.00 7,617,917.19 5,242,728.04
Total 101,392,043.00 66,551,899.59 7,617,917.19 5,242,728.04
77
(3) Main operations (by product)
Unit: yuan
Occurred in current period Occurred in previous period
Product
Operating revenue Operating cost Operating revenue Operating cost
Real estate 101,392,043.00 66,551,899.59
Fashion industry 7,617,917.19 5,242,728.04
Total 101,392,043.00 66,551,899.59 7,617,917.19 5,242,728.04
(4) Main operations (by region)
Unit: yuan
Occurred in current period Occurred in previous period
Region
Operating revenue Operating cost Operating revenue Operating cost
Export sales of clothes 2,815,199.68 3,001,269.15
Domestic sales of clothes 4,802,717.51 2,241,458.89
Domestic sales of real estate 101,392,043.00 66,551,899.59
Total 101,392,043.00 66,551,899.59 7,617,917.19 5,242,728.04
(5) Notes of TOP 5 Customers of the operating revenue
Unit: yuan
Name of customer Operating revenue Percent in total operating revenue of the Company (%)
Chen Ronghai 2,175,646.00 2.15%
Li Songxian 1,904,025.00 1.88%
Chen Jiajie 1,673,494.00 1.65%
Li Hong 1,544,418.00 1.52%
The fifth customer 1,444,861.00 1.42%
Chen Chunfu
Total 8,742,444.00 8.62%
Notes of operating revenue
25. Operating revenue and surcharges
Unit: yuan
Occurred in previous
Item Occurred in current period 计缴标准
period
Business tax 5,069,602.15 5%
78
City maintenance and construction
354,872.15 7%、5%
tax
Education expenses and surcharges 253,480.11 3%、2%
Land value increment tax 3,248,331.95 3.5%
Total 8,926,286.36 --
Notes of operating revenue and surcharges
26. Selling expenses
Unit: yuan
Item Occurred in current period Occurred in previous period
Selling expenses 364,306.74 757,544.50
Total 364,306.74 757,544.50
27. Administration expense
Unit: yuan
Item Occurred in current period Occurred in previous period
Administration expense 9,675,497.18 9,118,311.22
Total 9,675,497.18 9,118,311.22
28. Financial expense
Unit: yuan
Item Occurred in current period Occurred in previous period
Interest expenses 2,717,458.33 4,262,566.02
Less: Interest income 6,885.03 2,927.43
Exchange loss
Less: Exchange gain 64,493.26 54,799.14
Service fee expense 16,861.89 23,260.56
Total 2,662,941.93 4,228,100.01
29. Non-operating revenue
(1) Notes
Unit: yuan
79
Amount of the included
Occurred in current
Item Occurred in previous period non-recurring gains and
period
losses of the current period
Total gains on disposal of non-current assets 869.85
Including: gains on disposal of fixed assets 869.85
Others 6,875.00 531.35
Total 6,875.00 1,401.20
30. Non-operating expenses
Unit: yuan
Amount of the included
Occurred in previous non-recurring gains and
Item Occurred in current period
period losses of the current
period
Including: loss on disposal of fixed assets 9,326.17 9,326.17
Donation expenses 150,000.00 40,000.00 150,000.00
Surcharge expenditures 101,690.78 18,179.50 94,815.78
Total 261,016.95 58,179.50
Notes of non-operating expenses
31. Income tax expenses
Unit: RMB Yuan
Items Occurred in current period Occurred in previous period
Income tax for current period calculated by tax law and
5,900,592.79
relevant regulations
Deferred income tax adjustment -618,301.50
Total 5,900,592.79 -618,301.50
32 Basic earnings per share and diluted earnings per share
Profit of the reporting period Weighted average ROE EPS
Net profit attributable to ordinary 0.0207 0.02 0.02
80
shareholders of the Company after
deducting non-recurring gain or loss
The above data is calculated using the following formulae:
Weighted average return on net asset
Weighted average return on net asset = P0/(E0＋NP÷2＋Ei×Mi÷M0– Ej×Mj÷M0±Ek×Mk÷M0)
Where: P0 is net profit attributable to ordinary shareholders of the Company or net profit attributable to ordinary shareholders of the
Company after deducting non-recurring gain or loss; E0 is the year beginning equity attributable to ordinary shareholders of the
Company; Ei is increased equity attributable to ordinary shareholders of the Company which arises from new issuance of shares or
conversion of debt instruments to stocks in the reporting period; Ej is reduced equity attributable to ordinary shareholders of the
Company due to stock repurchase or cash dividend in the reporting period; M0 is the number of months of the reporting period; Mi is
the number of accumulative months from the next month that equity is increased to the end of the reporting period; Mj is the number
of months from the next month that equity is decreased to the end of the reporting period; Ek is the change of equity resulting from
other transactions or events and attributable to ordinary shareholders; Mk is the number of accumulative months from the next month
that other change of equity occurs to the end of the reporting period.
Basic earnings per share
Basic earnings per share = P0÷S
S= S0＋S1＋Si×Mi÷M0– Sj×Mj÷M0-Sk
Where: P0 is net profit attributable to ordinary shareholders of the Company or net profit attributable to ordinary shareholders of the
Company after deducting non-recurring gain or loss; S is weighted average number of ordinary shares outstanding; S0 is the total
number of shares at the beginning of the year; S1 is the number of increased shares as a result of capitalization of reserves or scrip
dividend during the reporting period; Si is the number of increased shares as a result of new issuance of shares or conversion of debt
instruments to stocks during the reporting period; Sj is the number of reduced shares as a result of stock repurchase; Sk is the number
of consolidated shares in the reporting period; M0 is the number of months of the reporting period; Mi is the number of accumulative
months from the next month that the number of shares is increased to the end of the reporting period; Mj is the number of
accumulative months from the next month that the number of shares is decreased to the end of the reporting period.
(If the Company have any dilutive potential ordinary shares , they should be adjusted respectively and attributable to net profit of reporting period of ordinary
shareholders and weighted average common shares outstanding, and by which calculate the diluted earnings per share)
Diluted earnings per share = P1/(S0＋S1＋Si×Mi÷M0–Sj×Mj÷M0–Sk+weighted average number of increased ordinary shares
arising from warrants, stock options and convertible debts)
Where: P1 is net profit attributable to ordinary shareholders of the Company or net profit attributable to ordinary shareholders of the
Company after deducting non-recurring gain or loss, and after the consideration of the effects of dilutive potential ordinary shares,
make adjustment according to relevant provisions of “Accounting Standards of Enterprises”.
In calculating the diluted earnings per share, the Company has taken into consideration the effects of all dilutive potential ordinary
shares on net profit attributable to the Company's common shareholders or net profit attributable to the Company's common
shareholders after deducting non-recurring profit or loss as well as weighted average number of shares, until the diluted earnings per
share reach the lowest amount.
(1) During period from balance sheet date to the date approved to issue the financial report, if the occurred stock dividend, reserve
capitalization, share split or share consolidation impact the number of outstanding ordinary shares or potential common shares but
without influent the amount of owner's equity, it should recalculate the earnings per share each comparative period at adjusted
number of shares.
81
(2) If business combination under the common control occurred during the reporting period, and the merging parties issue new shares
as the price in the merger date, when calculate basic earnings per share for the reporting period, such new shares should be treated as
outstanding common shares issued at the beginning of merge (weight average by weight of 1).When calculating of basic earnings per
share during the comparison period, such shares should be treated as outstanding common shares issued at the beginning of
comparison period. When calculating the earnings per share after deducting non-recurring profit or loss at the end of reporting period,
the new shares issued by the merging parties on the merger date will be weighted from the month next to the combined date. When
calculating the earnings per share after deducting non-recurring profit or loss during the comparison period, the new shares issued by
the merging parties on the merger date will not be weighted (the weight is 0).For the occurrence of business combination under the
common control at the reporting period, and the merging parties issue new shares as the price in the merger date, when calculating
the diluted earnings per share in the reporting period and comparison period, it should be treated according to the principles on
calculation of basic earnings per share.
(3) In the reporting period, if the company realizes the unlisted companies to list indirectly through share issue to purchase assets or
other means and which composing a reverse purchase, then when calculating earnings per share of the reporting period:
Weighted average number of ordinary shares in reporting period ＝ weighted average number in the month from reporting period
beginning to purchase date ＋ weighted average number from the next month to purchase date to the end of the reporting period
Weighted average number in the month from reporting period beginning to purchase date ＝ weighted average number of purchaser
(subsidiary in law) × exchange ratio in Purchase Agreement × number of cumulative months from year beginning to purchase
date ÷ number of months of reporting period
Weighted average number in the next month to purchase date to reporting period end ＝ weighted average number of acquiree
(parent company in law) × number of cumulative months from the next month to purchase date to reporting period end ÷ number
of months of reporting period
In the reporting period, if the company realizes the unlisted companies to list indirectly through share issue to purchase assets or
other means, then when calculating earnings per share of the comparison period:
Weighted average number of common shares in comparison period ＝ Purchaser (subsidiary in law) × exchange ratio in Purchase
Agreement
33 Notes to cash flow statement
(1). Other cash received relevant to operating activities
Unit: RMB Yuan
Item Amount
Other loans received 2,700,000.00
Other received relevant to operating activities 38,606,885.03
Total 41,306,885.03
Explanation on other cash received relevant to operating activities
(2). Other cash paid relevant to operating activities
Unit: RMB Yuan
Item Amount
82
Other current payments paid 2,700,000.00
Audit and other intermediary fees paid 444,690.00
Fees relevant to operating activities paid 78,362,883.07
Total 81,507,573.07
Explanation on other cash paid relevant to operating activities
34. Supplementary information for cash flow statement
(1). Supplementary information for cash flow statement
Unit: RMB Yuan
Supplemental information Amount in current period Amount in previous period
1. Reconciliation of net profit to net cash flows generated
-- --
from operating activities
Net profit 7,148,569.05 -13,630,304.55
Add: Provision for assets impairment -92,192.59 2,466,465.17
Depreciation of fixed assets, of oil-gas assets, of productive
2,223,117.85 2,517,371.53
biological assets
Amortization of intangible assets 336,594.12 336,594.12
Losses on disposal of property, plant and equipment,
intangible assets and other long-term assets (gains: 9,326.17 -869.85
negative)
Losses from variation of fair value (gains: negative) -3,404.00
Financial cost (gains: negative) 2,652,965.07 4,262,566.02
Decrease in deferred income tax assets (gains: negative) -848,574.63
Decrease in inventory (gains: negative) 66,551,899.59 -50,911,052.00
Decrease in accounts receivable from operating activities
-21,725,756.61 2,095,747.00
(gains: negative)
Increase in payables from operating activities (decrease:
-53,295,495.67 66,396,747.63
negative)
Other 30,314.26
Net cash flows generated from operating activities 3,875,417.21 12,681,286.44
2. Significant investing and financing activities that do not
-- --
involving cash receipts and payment:
3.Change on cash and cash equivalents: -- --
Closing balance of cash 24,066,267.29 4,392,797.84
Less: Opening balance of cash 21,555,492.79 1,600,749.63
83
Net increase in cash and cash equivalents 2,510,774.50 2,792,048.21
(2). Relevant information on acquiring or disposing subsidiaries and other business entities
Unit: RMB Yuan
Supplemental information Amount in current period Amount in previous period
I. Acquisition of subsidiaries and other business entities -- --
II. Disposal of subsidiaries and other business entities： -- --
3. Net cash received from disposal of subsidiaries and other
120,000.00 143,130.00
business entities
(3). Composition of cash and cash equivalents
Unit: RMB Yuan
Items Amount in current period Amount in previous period
I. Cash 24,066,267.29 21,555,492.79
Of which: Cash in hand 881,012.77 693,705.81
Bank deposit available to pay at any time 23,167,363.53 20,841,826.88
Other money funds available to pay at any time 17,890.99 19,960.10
III. Ending balance of cash and cash equivalents 24,066,267.29 21,555,492.79
Explanation on supplementary information for cash flow statement
VIII. Related parties and related parties transaction
1. Parent company of the Company
Proportion
Proportion
of parent
s of parent
company’ Ultimate
Legal company’
Relationsh Registered Business Registered s controller Organizati
Name Type representat s voting
ip address Nature Capital shareholdi of the on Code
ive right to the
ng to the Company
Company
Company
（%）
（%）
No. 212,
Puning
Build 46,
Shengheng
Controllin Qiao Guan
chang Chen
g Limited Village, Ma 74122232-
Trade Trading 9800 36.99% 36.99% Hongchen
shareholde liability Liu Sha Chanying 1
Developm g
r North
ent Co.,
Street,
Ltd.
Puning
Note to Parent company of the Company:
Puning Shenghengchang Trade Development Co., Ltd., Shenzhen Rishen Investment Co., Ltd. and Shantou Lianhua Industrial Co.,
Ltd. are controlled by the same family, which belong to action-in-concert promulgated by Measures for the Administration of
Disclosure of Information on the Change of Shareholdings in Listed Companies.
84
2. Status of subsidiaries
Legal
Type of Place of Registered Shareholdings Voting code of
Name Type representati Nature
subsidiaries Registration capital (%) (%) organization
ve
Shenzhen
Rieys Holding
Co., Ltd. Shenzhen Xu Wei Trading 50,000,000 90% 90% 72615364-7
Industrial Co., Subsidiary
Ltd.
Puning Tianhe Production
Garment and sales of
Holding Wang 65,100,000( 73412802-
Manufacturing Co., Ltd. Puning clothes and 100% 100%
Subsidiary Shaolun HKD) X
Factory Co., knitting
Ltd. colorized cloth
Tianrui (HK)
Holding Li 35181491-0
Trading Co., Co., Ltd. Hong Kong Trading 1(USD) 100% 100%
Subsidiary GuoQiang 00-11-12-8
Ltd.
Puning
Hengda Real
Holding Property
Estate Co., Ltd. Puning Chen Yuyi 26,000,000 100% 100% 69479921-5
Subsidiary development
Development
Co., Ltd.
Shenzhen
Yingda
Chuangyua
n Holding Property
Co., Ltd. Shenzhen Xu Wei 1 100% 100%
Constructio Subsidiary development
n
Investment
Co., Ltd.
3. Other related parties of the Company
Name of entities Relationship with the Company organization code
Shareholder holding 10.68% stake of the
Shenzhen Rishen Investment Co., Ltd. Company, affiliate controlled under Chen 72470265-7
Hongcheng’s family
Shareholder holding 3.81% stake of the
Puning Lianhua Industrial Co., Ltd. Company, affiliate controlled under Chen 23175521-6
Hongcheng’s family
Affiliate controlled under Chen
Shanghai Hong Yi Property Limited 729359800
Hongcheng’s family
85
Direct relatives of Cheng Hongcheng,and
Ma Chanying is the legal representative of
Chen Xuewen, Ma Chanying ——
parent company and Shenzhen Rishen
Investment Co., Ltd.
Chen Meixiang Direct relatives of Cheng Hongcheng ——
Vice-Board chairman of the Company,
Ding Lihong ——
relative of Cheng Hongcheng
Note to other related parties of the Company
4. Related parties transactions
（1）Guarantee of related parties Unit: RMB Yuan
Guarantee has been
Staring date of Maturity date of
Guarantee Secured party Security amount fully performed or
guarantee guarantee
not
Chen Hongcheng,
Chen Xuewen, Ding
Lihong, Dongguan
Jinjing Textile Co.,
Ltd., Puning
Shenghengchang
Trade Development
Co., Ltd., Puning
Tianhe Garment Guangdong Rieys
Manufacturing (Group) Company 14,099,960.00 Sep. 27, 2008 Sep. 27, 2009 No
Factory Co., Ltd., Limited
Shantou Lianhua
Industrial Co., Ltd.,
Shenzhen Rieys
Industrial Co., Ltd.,
Shenzhen Rishen
Investment Co., Ltd.,
Shanghai Hong Yi
Property Limited
Note to related parties transactions: the Company took factory dormitory, machinery & equipment and land use right as collateral,
meanwhile Ma Chanying took the two sets of properties in its name as collateral, in order to obtain the above bank loans for the
Company. The company has fully returned the principal and interest of GuangDa’s bank loans on July 4, 2013.
5. Accounts receivable and payable among related parties
Accounts receivable and payable among related parties of listed companies
Unit: RMB Yuan
86
Closing Opening
Name of project related parties
Book balance Bad debt reserves Book balance Bad debt reserves
Ding Lihong 300,000.00 0.00 0.00 0.00
300,000.00 0.00 0.00 0.00
Accounts payable among related parties of listed companies Unit: RMB Yuan
Name of project related parties Closing amount Opening amount
IX. Contingencies
1. Influences from offering debt guarantee or debt and finance for other organizations.
X. Commitments
1. Significant Commitments
2. The performance of commitments in previous period
Assets mortgage and Guarantee
1.In current period, the Company mortgaged its real estate for Huafengqiang trade co., LTD and the Jieyang
RongCheng sub-branch of The industrial and commercial bank of China co., LTD signing Maximum amount
mortgage contract, the Maximum amount mortgage contract was: Maximum amount mortgage in2012 NO. 5013
of RongCheng sub-branch.
The secured principle credit was from Oct 8, 2012 to Oct 8, offering collateral assessment value RMB 50,130,000.00;
besides, Huafengqiang trade co., LTD obtained RMB 25,000,000.00 from Jieyang RongCheng sub-branch of The industrial
and commercial bank of China co., LTD which was the guarantee for the company.
2. The Company mortgaged its dormitory, machinery and equipment as well as land use right, in order to obtain RMB40 million
borrowing from China Everbright Bank, Guangzhou Branch. The maturity date is September 27, 2009. Please see Note 6 (4) 2 for
details.
The original carrying value of the fixed assets and intangible assets mentioned in the aforesaid 1-2 points was RMB 93,003,211.78，
net amounts: RMB 56,390,618.53；and the second point was overdue.
XI. Post-balance-sheet events
1. Note to other Post-balance-sheet events
(1). Payment of the company
The company has fully returned the principal and interest of CEB loans on July 4, 2013; and the relevant guarantee and
mortgages have been lifted on July 24, 2013.
(2) Commitments of the company
From July 26, 2013 to the followed three month, there is no longer a plan for significant assets reorganization.
87
XII. Other significant events
1. Others
XIII. Notes to financial statements of parent company
1. Accounts receivable
(1) Accounts receivable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Provision for bad debts Book balance Provision for bad debts
Category Propo Proporti Proporti Proporti
Amount rtion Amount on Amount on Amount on
(%) (%) (%) (%)
Accounts receivable with
significant individual 4,608,276.88 100% 4,608,276.88 100% 4,608,276.88 100% 4,608,276.88 100%
amount
Accounts receivable according to the combination of provision for bad debts
Total 4,608,276.88 -- 4,608,276.88 -- 4,608,276.88 -- 4,608,276.88 --
Note to the category of accounts receivable
Accounts receivable with significant individual amount and single provision for bad debts
√ Applicable □ Inapplicable
Unit: RMB Yuan
Provision for bad
Content of accounts receivable Book balance Provision ratio Reasons
debts
Long-term credit, the
Hongkong Jinhua Trading Company 4,224,304.63 4,224,304.63 100% balance is
controversial
Long-term credit, the
Guangzhou Chen Shunqin 335,904.80 335,904.80 100% balance is
controversial
Long-term credit, the
Ningbo Industrial and Commercial
26,354.45 26,354.45 100% balance is
Bureau
controversial
Long-term credit, the
Content of accounts receivable 21,713.00 21,713.00 100%
balance is
88
controversial
Total 4,608,276.88 4,608,276.88 -- --
Portfolio accounts receivable of provision for bad debts preparation with the method of aging analysis
□ Applicable√ Inapplicable
Portfolio accounts receivable of balance the percentage method is used to provision for bad debts
□ Applicable√ Inapplicable
Portfolio accounts receivable of other method is used to provision for bad debts
□ Applicable√ Inapplicable
Closing accounts receivable that is of individually insignificant but single provision for bad debts.
□ Applicable√ Inapplicable
（2）Top 5 units in outstanding amount of accounts receivable
Unit: RMB Yuan
Relationship with the Proportion in total
Name of unit Amount Aging
Company accounts receivable
Hongkong Jinhua
Client 4,224,304.63 Over 3 years 91.67%
Trading Company
Guangzhou Chen
Client 335,904.80 Over 3 years 7.29%
Shunqin
Ningbo Industrial and
Client 26,354.45 Over 3 years 0.57%
Commercial Bureau
Beijing Capital Airport Client 21,713.00 Over 3 years 0.47%
Total -- 4,608,276.88 -- 100%
（3）
The transfer of accounts receivable amount not meeting derecognized conditions was RMB 0.00.
2. Other receivables
（1）Other receivables
Unit: RMB Yuan
Closing balance Opening balance
Provision for bad
Book balance Provision for bad debts Book balance
Category debts
Propo Propo Propo Propo
Amount rtion Amount rtion Amount rtion Amount rtion
(%) (%) (%) (%)
Accounts receivable with 2,331,608.20 2.91% 2,331,608.20 100% 2,331,608.20 2.34% 2,331,608.20 100%
89
significant individual
amount
Accounts receivable according to the combination of provision for bad debts
Other individually
insignificant accounts
81.12 85.45
receivable but in high risk 3,376,521.01 4.22% 2,740,358.59 2,538,015.43 2.55% 2,168,656.92
% %
portfolio after grouping by
credit risk characteristics
Added other insignificant
accounts receivable
Significant individual
accounts receivable but
according to the 92.86 95.11
74,282,477.75 187,098.33 0.25% 94,654,737.00 758,800.00 0.80%
characteristics of credit % %
provision
97.09 2,927,456.92 97.66
Combination subtotal 77,658,998.76 3.77% 97,192,752.43 2,927,456.92 3.01%
% %
Total 79,990,606.96 -- 5,259,065.12 -- 99,524,361.24 -- 5,259,065.12 --
Other accounts receivable with significant individual amount which individually assessed for bad debts at the end of the
period
√ Applicable □ Inapplicable
Unit: yuan
Withdrawing proportion
Contents Book value Amount of bad debts Reason
(%)
In previous years,
.The export tax rebate
2,331,608.20 2,331,608.20 100% retained balance has not
receivables
been processed
Total 2,331,608.20 2,331,608.20 -- --
In the groups, the other accounts receivable of provision for bad debts withdrawing by aging analysis
√ Applicable □ Inapplicable
Unit: yuan
Closing balance Opening balance
Book value Book value
Aging Provision for bad Provision for bad
Proport Proport
Amount debts Amount debts
ion(%) ion(%)
Within 1 year
90
Including:
Subtotal
Within 1 year 9,516,832.97 12.25% 190,336.66 27,762,694.25 28.74% 230.35
1 to 2 years 312,211.92 0.4% 31,221.19 1,438,424.80 1.49% 143,842.48
2 to 3 years 48,738.96 0.06% 24,369.48 211,732.36 0.22% 105,866.18
3 to 4 years 17,626.56 0.02% 14,101.25 19,246.86 0.02% 15,397.49
4 to 5 years 906,337.84 1.17% 656,138.91 954,466.33 0.99% 683,893.06
over 5years 66,857,250.51 86.09% 2,011,289.43 66,206,188.44 68.54% 1,378,227.36
2,927,456.92
Total 77,658,998.76 -- 96,592,753.04 -- 2,327,456.92
mount of other receivables in period-end
Unit: RMB Yuan
Relationship with the Proportion in total other
Name of unit Amount Aging
Company receivable (%)
Puning Rieys Paper
Client 9,354,916.67 Within 1 year 11.7%
Industrial Co., Ltd.
Guangdong Yuanfeng
trade development co., supplier 700,000.00 Over 3 years 0.88%
LTD
Shenzhen Zhao Tong
supplier 600,000.00 Over 3 years 0.75%
Investment Co., Ltd.
Guangzhou Nanxiang
construction engineering supplier 500,000.00 Over 3 years 0.63%
company
Huang Donglai Client 300,000.00 1~2years 0.38%
Total -- 11,454,916.67 -- 14.34%
（3）
Aging Closing balance Opening balance
Provision for bad Provision for bad
debts debts
91
2 to 3 years 48,738.96 1.44.00% 24,369.48 33,732.36 1.33% 16,866.18
Total 3,376,521.01 100.00% 2,740,358.59 2,538,015.43 100.00% 2,168,656.92
3. Long-term equity investments
Unit: RMB Yuan
Provision The
Change Stake in Voting in current
for
Initial Balance Differenc Depreciat
Audit Opening (increase the the impairme cash
Investee investmen at year e ion
method balance or investee investee nt loss in dividend
t end statement reserves
decrease) (%) (%) current s
period
Shenzhen
Rieys Cost 45,000,00 45,000,00 45,000,00
90% 90%
Industrial method 0.00 0.00 0.00
Co., Ltd.
Puning
Tianhe
Garment Subsidiar
Cost 51,712,50 51,712,50 51,712,50
Manufact 75% 100% y holds
method 0.42 0.42 0.42
uring 25%
Factory
Co., Ltd.
Shenzhen
Yingda
Chuangy
uan
Cost
constructi 1.00 0.00 1.00 1.00 100% 100%
method
on
investme
nt co.,
LTD
Tianrui
(HK) Cost
8.26 8.26 8.26 100% 100%
Trading method
Co., Ltd.
Puning
Hengda
Cost 146,600,0 146,600,0 146,600,0
Real 100% 100%
method 00.00 00.00 00.00
Estate
Develop
92
ment Co.,
Ltd.
243,312,5 243,312,5 243,312,5
Total -- 1.00 -- -- --
09.68 08.68 09.68
Note to Long-term equity investments
4. Supplementary information for cash flow statement
Unit: RMB Yuan
Supplementary information Amount in current period Amount in previous period
1. Reconciliation of net profit to net cash flows generated from
-- --
operating activities:
Net profit -7,170,879.21 -7,681,829.28
Add: Provision for impairment of assets 136,310.38
Depreciation of fixed assets, of oil-gas assets, of productive
1,752,915.19 1,751,726.58
biological assets
Amortization of intangible assets 336,594.12 336,594.12
Losses from variation of fair value (gains: negative) -3,404.00
Financial cost (gains: negative) 2,717,458.33 3,285,552.27
Decrease in deferred income tax assets (gains: negative) -1,597,704.71
Decrease in accounts receivable from operating activities (gains:
19,533,754.28 19,331,971.00
negative)
Increase in payables from operating activities (decrease: negative) -19,171,116.12 -6,690,957.62
Net cash flows generated from operating activities -2,001,273.41 8,868,258.74
2. Investing and financing activities that do not involving cash
-- --
receipts and payment:
3. Net increase in cash and cash equivalents: -- --
Closing balance of cash 4,619,037.40 707,181.42
Less: Opening balance of cash 7,628,811.81 1,338,922.68
Net increase in cash and cash equivalents -3,009,774.41 -631,741.26
XIV. Supplementary information
1. List of current non-recurring gains or losses
Unit: RMB Yuan
Items of non-recurring gains or losses Amount Remark
1. Profit or loss from disposal of non-current assets, (including The profit or loss of the disposal
-9,326.17
written-off parts made the provision for asset impairment ;) of fixed assets
93
Other profit or loss items meet the definition of non-recurring Various penalty, overdue fine,
-244,815.78
gains and losses. donation, etc.
Less：The affected amount of income tax 344.13
The affected amount of minority equity shareholders( after taxes) -765.12
Total -253,720.96 --
Explanation should be made, when the no-recurring profit or loss defined according to Company information disclosure of securities
for public issuance of explanatory announcement no. 1 non-recurring profit and loss, or listed from it was defined as current profit or
loss.
□ Applicable√ Inapplicable
2. Return on net assets and earnings per share
Unit: RMB Yuan
Weighted average return on EPS
Profit in reporting period
net assets Basic EPS Diluted EPS
Net profit attributable to common shareholders
0.02% 0.02 0.02
of the Company
Net profit attributable to common shareholders
of the Company after deducting non-recurring 0.02% 0.02 0.02
gains and losses
3. The anomalies in the Company’s financial statements and the reasons
Item Variation amount Variation rate（%） Remark
Monetary capital 2,510,774.50 11.65 Receive accounts from the sales of commercial housing
Accounts receivable -16,833,412.15 -56.98 The accounts receivable reduced because of the money of sales
of commercial housing coming to the account
Short-term loans -1,000,000.00 -6.62 Returned the everbright bank loan capital 1 million
yuan
Accounts payable -14,848,708.96 -48.09 Returned the credit payment for goods
Advance payment -6,662,144.47 -23.31 Deposit in advance of the sales of commercial housing
Interest payable 1,820,000.00 13.23 Provision for everbright bank interest
Other payables -25,283,772.53 -77.05 Repay loan
Operating revenue 93,774,125.81 1,230.97 Recognized revenue of the sale of commercial housing
Operating cost 61,309,171.55 1,169.41 Transaction cost of the sale of commercial housing
Operating expenses -393,237.76 -51.91 The reduction of export business
Assets impairment -2.558,657.76 -103.74 Less amount of the written off as bad debt
loss
94
Income tax expense 6,518,894.29 1,054.32 Increased profits of the sale of commercial housing
95
IX. Reference file directory
I. Semi-annual report text with legal representative signature;
II. Financial report text with signature and seal of legal representative of the financial director;
III. Public disclosure of all the original file and the announcement of the manuscript on the
newspapers and periodicals designated by the China securities regulatory commission during the
reporting period.
96
