2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
GUANGDONG RIEYS GROUP COMPANY LTD.
2014 Semi-annual Report
August 2014
1
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section I. Important Reminders, Contents & Definition
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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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Contents
2014 Semi-annual Report .................................................................................................................. 1
Section I. Important Reminders, Contents & Definition ............................................................... 2
Section II. Company Profile .............................................................................................................. 5
Section III. Highlights of Accounting Data & Financial Indicators .............................................. 7
Section IV. Report of the Board of Directors ................................................................................... 9
Section V. Significant Events ........................................................................................................... 15
Section VI. Change in Shares & Shareholders .............................................................................. 20
Section VII. Preferred Shares ......................................................................................................... 25
Section VIII. Directors, Supervisors & Senior Management Staff .............................................. 26
Section IX. Financial Report ...............................................................................................................
Section X. Documents Available for Reference ........................................................................... 105
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Definition
Refers
Term Definition
to
Refers
Company, the Company Guangdong Rieys Group Company Ltd.
to
Refers
Shenghengchang Huifu Shenzhen Shenghengchang Huifu Industrial Co., Ltd.
to
Refers
Risheng Chuangyuan Shenzhen Risheng Chuangyuan Asset Management Co., Ltd.
to
Refers
Lianhua Huiren Shenzhen Lianhua Huiren Industrial Co., Ltd.
to
Refers
Rieys Industrial Shenzhen Rieys Industrial Co., Ltd.
to
Refers Ya’an Zhengxing Marble Co., Ltd. and Sichuan Baoxing Zhengxing
Zhengxing Companies
to Marble Co., Ltd.
Refers
Huafengqiang Puning Huafengqiang Trading Co., Ltd.
to
Refers
CSRC China Securities Regulatory Commission
to
Refers
SZSE, the stock exchange Shenzhen Stock Exchange
to
Refers
Yuan RMB Yuan
to
Refers
Reporting period 1 Jan. 2014-30 Jun. 2014
to
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section 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 (if any)
English name of the Company
GUANG DONG 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. Contact information
Company Secretary Securities Affairs Representative
Name Xu Wei Luo Dandan
Room 4005-4006, 40/F International Room 4005-4006, 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
III. Other information
1. Ways to contact the Company
The registered address, office address and their postal codes, website address and email address of the Company did not change
during the reporting period. The said information can be found in the 2013 Annual Report.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
2. About information disclosure and where this report is placed
The newspapers designated by the Company for information disclosure, the website designated by CSRC for disclosing this report
and the location where this report is placed did not change during the reporting period. The said information can be found in the 2013
Annual Report.
3. Change of the registered information
The registration date and place of the Company, its business license No., taxation registration No. and organizational code did not
change during the reporting period. The said information can be found in the 2013 Annual Report.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section III. Highlights of Accounting Data & Financial Indicators
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of any accounting policy or
correction of any accounting error?
□ Yes √ No
Reporting period Same period of last year YoY +/- (%)
Operating revenues (RMB Yuan) 56,573,047.35 101,392,043.00 -44.20%
Net profit attributable to shareholders of
4,188,028.05 7,184,645.02 -41.71%
the Company (RMB Yuan)
Net profit attributable to shareholders of
the Company after extraordinary gains and 4,437,680.40 7,438,365.98 -40.34%
losses (RMB Yuan)
Net cash flows from operating activities
-52,127,961.90 3,875,417.21 -1,445.09%
(RMB Yuan)
Basic EPS (RMB Yuan/share) 0.0131 0.0225 -41.77%
Diluted EPS (RMB Yuan/share) 0.0131 0.0225 -41.77%
Weighted average ROE (%) 1.15% 2.00% -0.85%
As at the end of the
As at the end of last year +/- (%)
reporting period
Total assets (RMB Yuan) 448,815,289.63 487,217,084.43 -7.88%
Net assets attributable to shareholders of
366,688,203.71 362,500,175.66 1.16%
the Company (RMB Yuan)
II. Items and amounts of extraordinary gains and losses
√Applicable □ Inapplicable
Unit: RMB Yuan
Item Amount Explanation
Accounts receivable for which
Reversal of impairment provisions for the accounts receivable on
373,144.70 bad-debt provisions were made at
which the impairment test was carried out separately
full amount were recovered.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Fines, delay charges, donations,
Non-operating income and expenses other than the above -529,002.62
etc.
Less: Income tax effects 93,794.43
Total -249,652.35 --
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section IV. Report of the Board of Directors
I. Overview
In the first half of 2014, affected by the house purchase quota policy, the credit environment, etc., real estate trading was not as active
as last year. The floor space of new houses in building in the country, the floor space and the sales amount of commodity houses and
some other important indicators were not quite good, with the sharpest decline in the first-tier cities. Since rumors spread that some
real estate projects in cities such as Hangzhou and Changzhou would resort to price reduction, buyers became more hesitant and
more and more developers started sales promotion. Some second-tier cities and most of the third-tier and fourth-tier cities were under
a great pressure of de-stocking. For Jan.-May 2014, the floor space of new houses sold in the key cities under monitoring lingered at
a low level, accumulatively decreasing 18.1% year on year.
We expect that as the macro-control measure in the second half of 2014, the central government will uphold the principle of sorted
macro-control under general stability and balance supply and demand through the adjustment of the market itself. Meanwhile, the
central government’s economic expectation for the year, the recent pickup of major economic indicators and the signs of loosening
credit will help the real estate market become stable in the second half of the year.
For the reporting period, the Company achieved operating revenues of RMB 56.57 million, down 44.20% from RMB 101.39 million
in the same period of last year; operating profit of RMB 8.48 million, down 36.24% from RMB 13.30 million in the same period of
last year; and net profit attributable to the Company of RMB 4.19 million, down 41.64% from RMB 7.18 million in the same period
of last year. The aforesaid year-on-year changes of indicators were mainly because the sales income from the Shangdi Central project
developed by the Company deceased. Accounts receivable in the current period stood at RMB 3.91 million, down 68.19% from RMB
12.31 million at the period-beginning, mainly because the unsettled accounts in the sale of commodity houses decreased. Other
payables in the current period stood at RMB 7.15 million, down 58.29% from RMB 17.15 million at the period-beginning, mainly
because of the loan repayment. Prepayments in the current period stood at RMB 42.39 million, up 330.5% from RMB 9.85 million at
the period-beginning, mainly because the prepayments for construction were unsettled with invoices. Other receivables in the current
period stood at RMB 52.59 million, up 104.12% from RMB 25.76 million at the period-beginning, mainly because current accounts
increased. Accounts received in advance in the current period stood at RMB 28.40 million, down 47.65% from RMB 54.25 million at
the period-beginning, mainly because the pre-sale income from houses decreased.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
II. Main business analysis
YoY change of major financial data:
Unit: RMB Yuan
Reporting period Same period of last year YoY +/-% Main reasons for change
The house sales income
Operating revenues 56,573,047.35 101,392,043.00 -44.20%
decreased.
The house sales income
Operating costs 37,129,693.39 66,551,899.59 -44.21%
decreased.
The expenses on sale of
Selling expenses 204,936.34 364,306.74 -43.75% commodity houses
decreased.
Administrative expenses 7,661,332.06 9,675,497.18 -20.82%
Financial expenses 881,033.68 2,662,941.93 -66.92% Loan repayment
Income tax expenses 3,778,149.98 5,900,592.79 -35.97% Total profit decreased.
R&D inputs 0.00 0.00 0.00%
Other cash received
Net cash flows from
-52,127,961.90 3,875,417.21 -1,445.09% relating to operating
operating activities
activities decreased.
Net cash flows from No investing activity in
-364,642.71 -100.00%
investing activities the current period
Net cash flows from No financing activity in
-1,000,000.00 -100.00%
financing activities the current period
Net increase in cash and Prepayments for
-52,127,949.08 2,510,774.50 -2,176.17%
cash equivalents construction increased.
Review the progress of the previously disclosed business plan in the reporting period:
During the reporting period, the environmental impact of the market, leading to market wait-and-see atmosphere, the company
projects to achieve the sales area of 11550.66 square meters, the second half of the company will take effective measures to do a
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
good job in real estate sales and related development work. During the reporting period, the company by strengthening the control of
process and achieved certain results in the aspects of control production cost, decrease the cost of three to some extent, improve the
management quality, improve the profitability of the company. During the report period the company conducted a comprehensive
review of the internal control system, the internal control weakness rectification, internal control audit report preparation work has
been basically completed. In view of development of the company's industry and business, not made the obvious effect of financing,
the company will strengthen the business development efforts, do a good job of financing.
III. Breakdown of main business
Unit: RMB Yuan
Increase/decrease
Increase/decrease Increase/decrease
of operating
Operating of operating costs of gross profit
Operating costs Gross profit rate revenues over the
revenues over the same rate over the same
same period of
period of last year period of last year
last year
Classified by industry:
Real estate 52,379,119.00 33,325,155.69 36.38% -48.00% -50.00% 2.20%
Wholesale and
4,193,928.35 3,804,537.70 9.28% 0.00% 0.00% 9.28%
retail
Classified by product:
Commodity
52,379,119.00 33,325,155.69 36.38% -48.00% -50.00% 2.20%
houses
Rough stone
4,193,928.35 3,804,537.70 9.28% 0.00% 0.00% 9.28%
block
Classified by region:
Sales of domestic
52,379,119.00 33,325,155.69 36.38% -48.00% -50.00% 2.20%
real estate
Domestic
wholesale and 4,193,928.35 3,804,537.70 9.28% 0.00% 0.00% 9.28%
retail
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
IV. Investment analysis
1. Analysis to main subsidiaries and stock-participating companies
√ Applicable □ Inapplicable
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 47,408,082. 42,868,953. 4,193,928.3 -134,806.
Rieys
Subsidiary Trade and import 50,000,000 -134,806.12
Industrial 15 85 5 12
& export
Co., Ltd.
Production
Puning and sale of
Tianhe Manufactur garments, 65,100,000 254,807,06 235,778,90 1,285,708
Textile Subsidiary 0.00 713,492.83
Manufactor e knitted (HKD) 6.08 8.87 .55
y Co., Ltd. dyed cloth,
etc.
Tianrui 62,288,034. -28,478,257 -35,769.8
(HK)
Subsidiary Trade Trade 1 (USD) 0.00 -35,769.88
Trading
Co., Ltd. 77 .90 8
Real estate
developmen
Puning
t (operate
Hengda 349,322,86 202,634,76 52,379,119. 12,815,81
with the
Real Estate Subsidiary Real estate 26,000,000 9,611,703.76
valid 9.12 6.66 00 2.46
Developme
qualificatio
nt Co., Ltd.
n
certificate)
Shenzhen Real estate
Yingda developmen
Chuangyua t (operate
n with the
Subsidiary Real estate 1.00 791.17 -1,757.83 0.00 -399.40 -399.40
Constructio valid
n qualificatio
Investment n
Co., Ltd. certificate)
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
V. Implementation of profit allocation during the reporting period
The Company planed not to distribute cash dividends or bonus shares or turn capital reserve into share capital of the profits
distribution plan of last year.
VI. Preplan for profit distribution and turning capital reserve into share capital for the
reporting period
The Company planed not to distribute cash dividends or bonus shares or turn capital reserve into share capital for the reporting
period.
VII. Researches, visits and interviews received in the reporting period
√ Applicable □ Inapplicable
Main discussion and
Time of reception Place of reception Way of reception Visitor type Visitor materials provided by the
Company
Inquire of the operation of
10 Jan. 2014 the Company By phone Individual Investor
the Company
Inquire of the operation of
the Company and put
23 Jan. 2014 the Company By phone Individual Investor
forward the reform
suggestion of the B share
Inquire of the operation of
the Company and put
12 May 2014 the Company By phone Individual Investor
forward the reform
suggestion of the B share
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2014 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 related-party transactions
1. Related-party transactions concerning routine operation
√ Applicable □ Inapplicable
Pricing Settlemen
Type of Contents
principle Transacti Proportio t method
the of the
Related of the on n in same of the
Relations related-pa related-pa Transacti Market Date of Index of
transactio related-pa amount kind of related-pa
hip rty rty on price price disclosure disclosure
n party rty (RMB transactio rty
transactio transactio
transactio 0,000) ns transactio
n n
n n
Rieys See
signed the details to
Purchase the
and Sale Regarded announce
Enterprise Agreeme the Executed ment
Zhengxin under the nt of the market the disclosed
Routine
g control of Waste price as market 337.03 100.00% on the
operation
Company the actual Materials the fair value Securities
controller with pricing price Times,
Zhengxin principle Hong
g Kong Ta
Company Kung Pao
and Rieys and
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Industrial www.cnin
worked fo.com.cn
on the , which
sales was
business No.2014-
of the 015
waste
materials
of
marbles
and the
products.
Total -- -- 337.03 -- -- -- -- --
Details about return of large-amount sales Naught
Explain why the transaction price is greatly
Naught
different from the market price
III. Occupation of the Company’s funds for non-operating purposes by the controlling
shareholder and its related parties
The controlling shareholder or its related parties did not occupy the Company’s funds for non-operating purposes during the reporting
period.
IV. Significant contracts and their fulfillment
1. Guarantees provided by the Company
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Guarantees provided by the Company for external parties (excluding those for subsidiaries)
Guaranteed party Disclosure Amount for Actual Actual Type of Period of Executed Guarante
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
date of guarantee occurrence date guarantee guarantee guarantee or not e for a
relevant (date of amount related
announcem agreement) party or
ent on the not
guarantee
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
Five years
from the
independent
Puning Yanlilai contract
8 Apr. 2014 2,400 14 Apr. 2014 2,400 Mortgage No No
Trade Co., Ltd. (loan
contract)
coming into
effect
Total external guarantee line Total actual occurred amount
approved during the reporting 5,400 of external guarantee during 4,900
period (A1) the reporting period (A2)
Total external guarantee line that Total actual external guarantee
has been approved at the end of 5,400 balance at the end of the 4,900
the reporting period (A3) reporting period (A4)
Guarantees provided by the Company for its 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
Total actual occurred amount
Total guarantee line approved for
of guarantee for the
the subsidiaries during the 0 0
subsidiaries during the
reporting period (B1)
reporting period (B2)
Total guarantee line that has been 0 Total actual guarantee balance 0
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
approved for the subsidiaries at for the subsidiaries at the end
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 5,400 of guarantee during the 4,900
(A1+B1) reporting period (A2+B2)
Total guarantee line that has been Total actual guarantee balance
approved at the end of the 5,400 at the end of the reporting 4,900
reporting period (A3+B3) period (A4+B4)
Proportion of total guarantee amount (A4+B4) to the net assets
13.36%
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
Naught
liquidation due to immature guarantee (if any)
Explanation on provision of guarantees for external parties in
Naught
violation of the prescribed procedure (if any)
Explanation on guarantee that adopts complex method
(1) Illegal provision of guarantees for external parties
There was no any illegal provision of guarantees for external parties of the Company of the reporting period.
V. Commitments made by the Company or any shareholder holding over 5% of the
Company’s shares in the reporting period or such commitments carried down into the
reporting period
There was no any commitment made by the Company or any shareholder holding over 5% of the Company’s shares in the reporting
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
period or such commitment carried down into the reporting period.
VI. Engagement and disengagement of the CPAs firm
Has the semi-annual financial report been audited?
□ Yes √ No
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section VI. Change in Shares & Shareholders
I. Change in shares
Unit: Share
Before the change Increase/decrease (+, -) After the change
Capitalizat
Percentag New Bonus ion of Percentag
Number Other Subtotal Number
e shares shares capital e
reserve
164,025,0 164,025,0
I. Shares subject to trading 51.48% 0 0 0 0 0 51.48%
moratorium 00 00
1. Shares held by the State 0 0.00% 0 0 0 0 0 0 0.00%
2. Share held by
0 0.00% 0 0 0 0 0 0 0.00%
state-owned corporations
164,025,0 164,025,0
3. Shares held by other 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 0.00% 0 0 0 0 0 0 0.00%
natural persons
4. Shares held by foreign
0 0.00% 0 0 0 0 0 0 0.00%
investors
Among which: Shares held
0 0.00% 0 0 0 0 0 0 0.00%
by foreign corporations
Shares held by foreign
0 0.00% 0 0 0 0 0 0 0.00%
natural persons
154,575,0 154,575,0
II. Shares not subject to 48.52% 0 0 0 0 0 48.52%
trading moratorium 00 00
1. Renminbi ordinary
0 0.00% 0 0 0 0 0 0 0.00%
shares
2. Domestically listed
154,575,0 48.52% 0 0 0 0 0 154,575,0 48.52%
foreign shares
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
00 00
3. Overseas listed foreign
0 0.00% 0 0 0 0 0 0 0.00%
shares
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
318,600,0 318,600,0
III. Total shares 100.00% 0 0 0 0 0 100.00%
00 00
II. Total number of shareholders and their shareholdings
Unit: Share
Total number of preferred share
Total number of common holders who had resumed their
shareholders at the end of the 12,517 voting right at the end of the 0
reporting period reporting period (if any) (see
note 8)
Shareholdings of shareholders holding more than 5% shares or top 10 shareholders
Increase Number Pledged or frozen shares
Number
/decreas of
Total shares of
Name of Nature of Shareholding e during non-trad
held at the tradable Number of
shareholder shareholder percentage the able Status of shares
period-end shares shares
reportin shares
held
g period held
Shenzhen
Domestic
Shenghengchang 117,855,
non-state-owned 36.99% 117,855,000 0 0 Pledged 117,855,000
Huifu Industrial 000
corporation
Co., Ltd.
Shenzhen
Risheng
Domestic 34,020,
Chuangyuan
non-state-owned 10.68% 34,020,000 0 0 Pledged 34,020,000
Asset 000
corporation
Management Co.,
Ltd.
GUOTAI Foreign corporation 8.01% 25,520,786 +1,050, 0 25,520,
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
JUNAN 694 786
SECURITIES
(HONGKONG)
LIMITED
Shenzhen
Domestic
Lianhua Huiren 12,150,
non-state-owned 3.81% 12,150,000 0 0 Pledged 12,150,000
Industrial Co., 000
corporation
Ltd.
China Everbright
+402,21 7,366,5
Securities (HK) Foreign corporation 2.31% 7,366,520
0 20
Limited
Domestic natural 7,217,2
Su Youhe 2.27% 7,217,210 0
person 10
Shanghai
Wanguo +322,41 3,833,3
Foreign corporation 1.20% 3,833,324
Securities (HK) 2 24
Limited
Domestic natural 2,396,6
Fan Jiongyang 0.75% 2,396,620 0
person 20
Wei Guobin
Foreign natural 1,145,8
(NGAI KWOK 0.36% 1,145,816 0
person 16
PAN)
Foreign natural 1,100,0
LUO DONG HUI 0.35% 1,100,000 0
person 00
Strategic investor or general
corporation becoming a top ten
Inapplicable
shareholder due to placing of new
shares (if any) (see note 3)
Shenzhen Shenghengchang Huifu Industrial Co., Ltd., Shenzhen Risheng Chuangyuan
Explanation on associated relationship
Asset Management Co., Ltd. and Shenzhen Lianhua Huiren Industrial Co., Ltd., which
or/and persons acting in concert among
belonged to action-in-concert promulgated by Measures for the Administration of
the above-mentioned shareholders:
Disclosure of Information on the Change of Shareholdings in Listed Companies. The
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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 year-end
Type Number
GUO TAI JUN AN SECURITIES Domestically
25,520,786 listed foreign 25,520,786
(HONGKONG) LIMITED shares
China Everbright Securities (HK) Domestically
7,366,520 listed foreign 7,366,520
Limited shares
Domestically
Su Youhe 7,217,210 listed foreign 7,217,210
shares
Domestically
Shanghai Wanguo Securities (HK)
3,833,324 listed foreign 3,833,324
Limited
shares
Domestically
Fan Jiongyang 2,396,620 listed foreign 2,396,620
shares
Domestically
Wei Guobin (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 768,864 listed foreign 768,864
shares
Domestically
Han Liang 711,458 listed foreign 711,458
shares
Domestically
Wang Yiping 707,213 listed foreign 707,213
shares
Explanation on associated relationship
or/and persons acting in concert among
the top ten tradable shareholders and Unknown
between the top ten tradable
shareholders and the top ten
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
shareholders
Explanation on the top 10 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?
The shareholder of the Company was not involved with any agreed buy-back in the reporting period.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section VII. Directors, Supervisors & Senior Management Staff
I. Change of shareholdings of directors, supervisors and senior management staff
There was no change in the shareholdings of directors, supervisors and senior management staff in the reporting period. For details,
please refer to the 2013 Annual Report.
II. Change of directors, supervisors and senior management staff
There was no change of the directors, supervisors and senior management staff. For details, please refer to the 2013 Annual Report.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section VIII. Financial Report
I. Audit report
The semi-annual financial report has 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 4,202,691.14 56,330,640.22
Settlement reserves
Intra-group lendings
Transactional financial assets
Notes receivable
Accounts receivable 3,914,869.14 12,308,091.34
Accounts paid in advance 42,393,769.30 9,847,534.50
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract
reserves
Interest receivable
Dividend receivable
Other accounts receivable 52,585,140.20 25,762,037.12
25
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Financial assets purchased under
agreements to resell
Inventories 230,518,850.98 264,767,911.02
Non-current assets due within 1 year
Other current assets
Total current assets 333,615,320.76 369,016,214.20
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 81,728,723.39 83,747,681.91
Construction in progress
Engineering materials 54,526.00 54,526.00
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 26,710,394.97 27,046,989.09
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 6,465,124.51 7,110,473.23
Other non-current assets 241,200.00 241,200.00
26
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Total of non-current assets 115,199,968.87 118,200,870.23
Total assets 448,815,289.63 487,217,084.43
Current liabilities:
Short-term borrowings
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 14,670,041.72 12,910,472.20
Accounts received in advance 28,397,566.14 54,245,815.90
Financial assets sold for repurchase
Handling charges and commissions
payable
Employee’s compensation payable 534,091.52 570,074.38
Tax payable 27,086,492.12 35,541,585.46
Interest payable
Dividend payable
Other accounts payable 7,151,999.03 17,148,584.83
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
27
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Other current liabilities
Total current liabilities 77,840,190.53 120,416,532.77
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 77,840,190.53 120,416,532.77
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 -90,077,553.07 -94,265,581.12
Foreign exchange difference
Total equity attributable to owners of
366,688,203.71 362,500,175.66
the Company
Minority interests 4,286,895.39 4,300,376.00
Total owners’ (or shareholders’) equity 370,975,099.10 366,800,551.66
28
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Total liabilities and owners’ (or
448,815,289.63 487,217,084.43
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 3,168,838.86 5,484,282.30
Transactional financial assets
Notes receivable
Accounts receivable
Accounts paid in advance
Interest receivable
Dividend receivable
Other accounts receivable 85,736,787.75 67,379,868.41
Inventories
Non-current assets due within 1 year
Other current assets
Total current assets 88,905,626.61 72,864,150.71
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 243,312,509.68 243,312,509.68
29
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Investing property
Fixed assets 78,514,020.84 80,117,954.04
Construction in progress
Engineering materials 54,526.00 54,526.00
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 26,710,394.97 27,046,989.09
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 2,503,495.16 2,503,495.16
Other non-current assets
Total of non-current assets 351,094,946.65 353,035,473.97
Total assets 440,000,573.26 425,899,624.68
Current liabilities:
Short-term borrowings
Transactional financial liabilities
Notes payable
Accounts payable 19,442.64 19,442.64
Accounts received in advance
Employee’s compensation payable 211,472.42 209,326.67
Tax payable 1,057,864.73 1,888,089.52
Interest payable
30
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Dividend payable
Other accounts payable 218,282,071.12 197,551,742.96
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 219,570,850.91 199,668,601.79
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 219,570,850.91 199,668,601.79
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 -236,336,034.43 -230,534,733.89
Foreign exchange difference
31
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Total owners’ (or shareholders’) equity 220,429,722.35 226,231,022.89
Total liabilities and owners’ (or
440,000,573.26 425,899,624.68
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. 2014 Jan.-Jun 2013
I. Total operating revenues 56,573,047.35 101,392,043.00
Including: Sales income 56,573,047.35 101,392,043.00
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 48,091,347.31 88,088,739.21
Including: Cost of sales 37,129,693.39 66,551,899.59
Interest expenses
Handling charge and
commission expenses
Surrenders
Net claims paid
Net amount withdrawn for the
insurance contract reserve
Expenditure on policy dividends
Reinsurance premium
Taxes and associate charges 4,747,492.34 8,926,286.36
Selling and distribution expenses 204,936.34 364,306.74
32
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Administrative expenses 7,661,332.06 9,675,497.18
Financial expenses 881,033.68 2,662,941.93
Asset impairment loss -2,533,140.50 -92,192.59
Add: Gain/(loss) from change in fair
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) 8,481,700.04 13,303,303.79
Add: non-operating income 2,033.00 6,875.00
Less: non-operating expense 531,035.62 261,016.95
Including: loss from non-current asset
disposal
IV. Total profit (“-” means loss) 7,952,697.42 13,049,161.84
Less: Income tax expense 3,778,149.98 5,900,592.79
V. Net profit (“-” means loss) 4,174,547.44 7,148,569.05
Including: Net profit achieved by
combined parties before the
combinations
Attributable to owners of the
4,188,028.05 7,184,645.02
Company
Minority shareholders’ income -13,480.61 -36,075.97
VI. Earnings per share -- --
(I) Basic earnings per share 0.010 0.020
(II) Diluted earnings per share 0.010 0.020
VII. Other comprehensive incomes
VIII. Total comprehensive incomes 4,174,547.44 7,148,569.05
33
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Attributable to owners of the
4,188,028.05 7,184,645.02
Company
Attributable to minority
-13,480.61 -36,075.97
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. 2014 Jan.-Jun 2013
I. Total sales 0.00 0.00
Less: cost of sales 0.00 0.00
Business taxes and surcharges
Distribution expenses
Administrative expenses 4,434,865.74 4,348,507.92
Financial costs 835,606.62 2,719,246.06
Impairment loss
Add: gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-” means
loss)
Including: income form investment on
associates and joint ventures
II. Business profit (“-” means loss) -5,270,472.36 -7,067,753.98
Add: non-business income
Less: non-business expense 530,828.18 103,125.23
Including: loss from non-current asset
disposal
III. Total profit (“-” means loss) -5,801,300.54 -7,170,879.21
34
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Less: income tax expense
IV. Net profit (“-” means loss) -5,801,300.54 -7,170,879.21
V. Earnings per share -- --
(I) Basic earnings per share -0.020 -0.020
(II) Diluted earnings per share -0.020 -0.020
VI. Other comprehensive income
VII. Total comprehensive income -5,801,300.54 -7,170,879.21
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. 2014 Jan.-Jun 2013
I. Cash flows from operating activities:
Cash received from sale of
40,246,188.00 111,655,503.27
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
35
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
Other cash received relating to
16,716,093.88 41,306,885.03
operating activities
Subtotal of cash inflows from operating
56,962,281.88 152,999,075.97
activities
Cash paid for goods and services 28,894,988.00 43,911,805.96
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 2,564,090.18 3,649,191.48
Various taxes paid 16,634,181.92 20,055,088.25
Other cash payment relating to
60,996,983.68 81,507,573.07
operating activities
Subtotal of cash outflows from
109,090,243.78 149,123,658.76
operating activities
Net cash flows from operating activities -52,127,961.90 3,875,417.21
II. Cash flows from investing activities:
Cash received from withdrawal of
investments
Cash received from return on
investments
36
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Net cash received from disposal of
fixed assets, intangible assets and other 120,000.00
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
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 484,642.71
assets
Cash paid for investment
Net increase of pledged loans
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
484,642.71
investing activities
Net cash flows from investing activities -364,642.71
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
37
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
financing activities
Net cash flows from financing activities -1,000,000.00
IV. Effect of foreign exchange rate
12.82
changes on cash and cash equivalents
V. Net increase in cash and cash
-52,127,949.08 2,510,774.50
equivalents
Add: Opening balance of cash and
56,330,640.22 21,555,492.79
cash equivalents
VI. Closing balance of cash and cash
4,202,691.14 24,066,267.29
equivalents
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. 2014 Jan.-Jun 2013
I. Cash flows from operating activities:
Cash received from sale of
commodities and rendering of service
Tax refunds received
Other cash received relating to
62,009,792.11 117,036,546.54
operating activities
Subtotal of cash inflows from operating
62,009,792.11 117,036,546.54
activities
Cash paid for goods and services
Cash paid to and for employees 883,627.87 769,035.01
38
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Various taxes paid 841,608.71 1,745,041.25
Other cash payment relating to
62,599,998.97 116,523,743.69
operating activities
Subtotal of cash outflows from
64,325,235.55 119,037,819.95
operating activities
Net cash flows from operating activities -2,315,443.44 -2,001,273.41
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,
intangible assets and other long-term 8,500.00
assets
Cash paid for investment
Net cash paid to acquire subsidiaries
1.00
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
8,501.00
investing activities
Net cash flows from investing activities -8,501.00
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
39
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
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
financing activities
Net cash flows from financing activities -1,000,000.00
IV. Effect of foreign exchange rate
changes on cash and cash equivalents
V. Net increase in cash and cash
-2,315,443.44 -3,009,774.41
equivalents
Add: Opening balance of cash and
5,484,282.30 7,628,811.81
cash equivalents
VI. Closing balance of cash and cash
3,168,838.86 4,619,037.40
equivalents
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. 2014
Unit: RMB Yuan
Jan.-Jun. 2014
Equity attributable to owners of the Company Total
Item Minority
Paid-up Capital Less: Specific Surplus General Retaine owners’
Others interests
capital reserve treasury reserve reserve risk d profit equity
40
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(or stock reserve
share
capital)
I. Balance at the end of the 318,600 52,129,4 86,036, -94,265, 4,300,376 366,800,55
previous year ,000.00 96.58 260.20 581.12 .00 1.66
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, -94,265, 4,300,376 366,800,55
the year ,000.00 96.58 260.20 581.12 .00 1.66
III. Increase/ decrease in the 4,188,02 -13,480.6 4,174,547.
period (“-” means decrease) 8.05 1 44
4,188,02 -13,480.6 4,174,547.
(I) Net profit
8.05 1 44
(II) Other comprehensive
incomes
4,188,02 -13,480.6 4,174,547.
Subtotal of (I) and (II)
8.05 1 44
(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
41
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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, -90,077, 4,286,895 370,975,09
IV. Closing balance
,000.00 96.58 260.20 553.07 .39 9.10
Jan.-Jun. 2013
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, -101,15 4,395,584 360,009,08
previous year ,000.00 96.58 260.20 2,252.70 .56 8.64
Add: retrospective
adjustment due to business
42
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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, -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 6,886,67 -95,208.5 6,791,463.
period (“-” means decrease) 1.58 6 02
6,886,67 -95,208.5 6,791,463.
(I) Net profit
1.58 6 02
(II) Other comprehensive
incomes
6,886,67 -95,208.5 6,791,463.
Subtotal of (I) and (II)
1.58 6 02
(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
43
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
4. Other
(Ⅵ) Specific reserve
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, -94,265, 4,300,376 366,800,55
IV. Closing balance
,000.00 96.58 260.20 581.12 .00 1.66
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. 2014
Unit: RMB Yuan
Jan.-Jun. 2014
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 -230,534,7 226,231,02
previous year
44
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
0.00 .58 .20 33.89 2.89
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 -230,534,7 226,231,02
the year 0.00 .58 .20 33.89 2.89
III. Increase/ decrease in the -5,801,300. -5,801,300.
period (“-” means decrease) 54 54
-5,801,300. -5,801,300.
(I) Net profit
54 54
(II) Other comprehensive
incomes
-5,801,300. -5,801,300.
Subtotal of (I) and (II)
54 54
(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
45
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(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 -236,336,0 220,429,72
IV. Closing balance
0.00 .58 .20 34.43 2.35
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
46
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
0.00 .58 .20 36.49 0.29
III. Increase/ decrease in the -14,841,79 -14,841,79
period (“-” means decrease) 7.40 7.40
-14,841,79 -14,841,79
(I) Net profit
7.40 7.40
(II) Other comprehensive
incomes
-14,841,79 -14,841,79
Subtotal of (I) and (II)
7.40 7.40
(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
47
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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 -230,534,7 226,231,02
IV. Closing balance
0.00 .58 .20 33.89 2.89
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 30 Jun. 2014, 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 a general terms of “the Group”) mainly engaged in production of various
kinds of garment such as western-style clothes, fashionable dress and knitwear, processing and sales as well as the sales such as industry
means of production, hardware and electrical equipment, chemical products, general merchandise, furniture, arts and crafts and
subsidiary agricultural products (not including the franchised, exclusive control and monopolized commodities), real estates
development and management and other investments.
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IV. Principal accounting policies and estimates and previous error
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 31 December.
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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
than the fair value of identifiable assets of the purchased parties obtained in the merger will be accrued in current profit or loss.
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.
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
Business transactions are settled by foreign currencies
(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
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
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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
(1) The 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,
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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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:
1. The book value of the transferred financial asset;
2. The 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 recognized 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:
1. Book value of the derecognized portion;
2. The 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
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.
(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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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.
(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.
Each reorganization standard for each available-for-sale impairment financial asset
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 are 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
conduct impairment testing separately; for receivables without
Standard of significant single amounts 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
the receivable groups to determine the impairment loss and
make provision for bad debts.
Conduct impairment testing separately on accounts receivable
Withdrawing method of provision for bad debts of significant
with relatively higher individual price at end of the period. If
single amounts
there is objective evidence to indicate that impairment exists,
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
recognize impairment loss and provide for bad and doubtful
debts in accordance with the difference between its future cash
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) Single amounts not significant but individually withdrawing provision of bad debts of receivables
Reason of individually withdrawing bad debt
There is objective evidence indicates the impairment.
provision:
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
Withdrawal method for bad debt provision:
in accordance with the difference between its future cash 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.
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.
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.
(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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
Low cost and short lived articles
Amortization method: step-amortization
Package materials
Amortization method: step-amortization
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
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.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(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.
(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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
The fixed assets should have the initial measurement according to the actual cost when received.
(1) The cost of outsourcing the fixed assets should be recognized according to the transport charge, handling charge, installation
charge and service charge of professional personnel that attributed to the assets occurred for purchasing prices and relevant taxes
before leading the fixed assets reach the expected serviceable condition.
(2) If the prices for purchasing the fixed assets over the normal credit conditions and delayed for payment which were the financing
assets in nature, the cost of the fixed assets should recognized based on the current price of the purchasing price. The cost of
voluntary building the fixed assets is formed by the necessary expenses occurred before the assets reach the expected serviceable
condition.
(3) The fixed assets gained by the creditors when having debt restructuring for debt, should recognize its entry value based on the fair
value of the fixed assets, and at the same time calculate the difference between the book value of debt restructuring and the fair value
of the fixed assets for debt into the current gains and losses;
(4) Under the premise when non-monetary assets exchange possesses the commercial essence as well as the fair value of the swap-in
or swap-out assets could be reliable calculated, the entry value of the swap-in fixed assets should be recognized based on the fair
value of the swap-out assets, unless there is concrete evidence indicates the fair value of the swap-in assets are more reliable; if the
non-monetary assets not met with the above premises, should recognized the cost of the fixed assets based on the book value of the
swap-out assets and the relevant taxes payable that not recognized its gains and losses.
(5) The fixed assets gained by the enterprise absorption merger way under the same control, should recognized its entry value
according to the book value of the combined party; the fixed assets gained by the enterprise absorption merger way not under the
same control, should recognized its entry value according to the fair value.
(6) The fixed assets gained from financing leasing, should recognized its entry value according to the lower price between the fair
value of the leasing assets on the Lease commencement date and the current value of the minimum leasing payment.
(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
method is adopted, as following:
The fixed assets gained from financing leasing, if could ensure reasonable to gain the ownership of the leasing assets when the term
expired, should withdraw the depreciation during the service period of the leasing assets; if could not ensure reasonable to gain the
ownership of the leasing assets when the term expired, should withdraw the depreciation during the shorter period between the
leasing period and the service period of the leasing assets.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
If the fixed assets gained from the financing leasing method met with the capitalization condition of the remodeling expense, should
average amortized according to the shortest period among the period between the two decorations, the rest leasing period and the
service period of the fixed assets.
Estimated net residual value
Category Estimated useful life (year) Annual depreciation rate
rate
Buildings and constructions 35 years 5.00% 2.71%
Machinery equipment 10 years 5.00% 9.50%
Transportation equipment 8 years 5.00% 11.88%
Office equipment and others 5 years 5.00% 19.00%
(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 are confirmed impairment would cause 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.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(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 are confirmed impairment would cause 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:
1. 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;
2. The borrowing expenses have occurred;
3. The necessary construction or production activities to make the assets ready for use or sales have been launched.
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.
(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) 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.
17. Intangible assets
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(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.
(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.
Impairment loss on intangibles shall not be reversed once recognized.
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.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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.
19. Estimated liabilities
(1) Criteria of estimated liabilities
Only if the obligation pertinent to a contingencies such as external guarantee, unsettled lawsuits or arbitrations, quality guarantee of
the products, losses contracts, restructuring obligations, retirement obligations of fixed assets shall be recognized as an estimated
debts when the following conditions are satisfied simultaneously:
(1) That obligation is a current obligation of the Company;
(2) It is likely to cause any economic benefit to flow out of the Company as a result of performance of the obligation; and
(3) The amount of the obligation can be measured in a reliable way.
(2) Measurement of estimated liabilities
The Company shall measure the estimated debts in accordance with the best estimate of the necessary expenses for the performance
of the current obligation.
When recognizing the current best estimate, the Company should comprehensive consider the elements such as the risks, uncertainty
and currency time and value of the contingencies.
The best estimate should be respectively disposed according to the following situations:
(1) If there is a sequent range (or section) for the necessary expenses and if all the outcomes within this range are equally likely to
occur, the best estimate shall be determined in accordance with the middle estimate which is equaled to the average amount of the
bound amount within the range.
(2) When there is not a sequent range (or section) for the necessary expenses, or there is a sequent range but the possibility of various
kinds of results happed would be different within the range, so if the contingencies concern a single item, the best estimate shall be
determined in the light of the most likely outcome; and if the contingencies concern two or more items, the best estimate should be
calculated and determined in accordance with all possible outcomes and the relevant probabilities.
When all or some of the expenses necessary for the liquidation of an estimated debts of an enterprise is expected to be compensated
by a third party, the compensation should be separately recognized as an asset when it is virtually certain that the reimbursement will
be obtained and the amount recognized for the reimbursement should not exceed the book value of the estimated debts.
20. 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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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:
(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.
21. 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 policy
The government grants should be recognized when simultaneously met with the following conditions:
(1) The Company can meet the conditions for the government subsidies;
(2) The enterprise can obtain the government subsidies.
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.
22. 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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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.
23. 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 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
1. the Company as the leaser
In 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.
For rent in operating leases, the Company will use the straight-line method to recognize the current gains and losses. The initial direct
costs occurred will be through current profit or loss.
2. the Company as the leasee
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.
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 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.
24. Changes in main accounting policies and estimates
There was no change in main accounting policies and estimates.
(1) Changes of main accounting policies
Whether there were changes of main accounting policies of the reporting period
□ Yes √ No
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(2) Change of accounting estimates
Whether there were changes of accounting estimates
□ Yes √ No
25. Correction of previous accounting errors
Whether there was correction of previous accounting errors
□ Yes √ No
There was no error.
(1) Retrospective restatement method
Was any previous accounting error adopting retrospective restatement method discovered in the report period?
□Yes √No
(2) Prospective application method
Was any previous accounting error adopting prospective application method discovered in the report period?
□Yes √No
V. Taxation
1. Main taxes and tax rate of the Company
Type of tax Tax rate Taxable basis
VAT Revenue of product 17%
Business tax Revenue of sales of real estate 5%
Enterprise income tax Taxable income 25%
Income tax rate of the company and branches
2. Other explanation
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 Hong Kong SAR are entitled to a profits tax rate of 16.5%.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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 RMB 10,000.
(1) Subsidiaries obtained through the establishment or investment
Unit: RMB Yuan
Balance
of the
owner's
equity
of
parent
compan
Balance y after
of net deductin
Actual Minorit Gains &
investm g the
Place of Register investm Shareho Consoli y losses of
Scope of ent in Voting share of
Name Type Registra Nature ed ent as at ldings dated or sharehol minority
business subsidia current
tion capital period not ders’ sharehol
ries in losses of
end equity ders
substanc minority
e sharehol
ders
over the
share of
owner’s
equity
enjoyed
by such
65
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
minority
sharehol
ders in
the
subsidia
ry in the
period
beginni
ng
Investm
Shenzhe
ent and
n Rieys 45,000, 4,286,8 -13,480.
Co., Shenzhe 50,000, import
Industri Trading 90.00% 90.00% Yes 0.00
Ltd. n 000 & 000.00 95.39 61
al Co.,
export
Ltd.
trading
Producti
on and
Puning
Tianhe sales of
65,100,
Garmen clothes 65,100, 100.00 100.00
Co., Manufa
t Puning 000 Yes 0.00 0.00 0.00
Ltd. cture and 000.00 % %
Manufa
(HKD)
cturing knitting
Factory
colorize
d cloth
Shenzhe
n
Yingdac Municip
haungyu al public
an project 100.00 100.00
Shenzhe Real
construc Co., Ltd 1 and real 1.00 Yes 0.00 0.00 0.00
n estate % %
ting and estate
Manufa develop
cturing ment
Co.,
Ltd.
(2) Subsidiaries obtained through business consolidation under common control
Unit: RMB Yuan
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Balance
of the
owner's
equity
of
parent
compan
y after
deductin
g the
share of
current
Balance
losses of
of net
Actual Minorit Gains & minority
investm
Place of Register investm Shareho Consoli y losses of sharehol
Scope of ent in Voting
Name Type Registra Nature ed ent as at ldings dated or sharehol minority ders
business subsidia
tion capital period not ders’ sharehol over the
ries in
end equity ders share of
substanc
owner’s
e
equity
enjoyed
by such
minority
sharehol
ders in
the
subsidia
ry in the
period
beginni
ng
Tianrui
(HK) 100.00 100.00
Co., Hong
Trading Trading 1 (USD) Trading 1.00 Yes 0.00 0.00 0.00
Ltd. Kong % %
Co.,
Ltd.
Puning Property
Hengda develop
Real ment
Property 26,000,
Estate Co., (operate 146,600 100.00 100.00
Puning develop Yes 0.00 0.00 0.00
Develop Ltd. 000 with ,000.00 % %
ment
ment valid
Co., qualific
Ltd. ation
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
certifica
te)
2. Notes about change in scope of consolidation
Notes about change in scope of consolidated statement
1. 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 of the reporting period
There was no any subsidiary, subject with special purposes and business entity which controlling right is formed by entrusted
operation or lease newly included in current scope of consolidation of the reporting period.
2. Subsidiaries, subjects with special purposes and business entities which controlling right is formed by entrusted operation or lease
no longer included in current scope of consolidation of the reporting period
There was no any subsidiary, subject with special purposes and business entity which controlling right is formed by entrusted
operation or lease no longer included in current scope of consolidation of the reporting period.
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
Cash -- -- 833,603.23 -- -- 800,582.60
RMB -- -- 833,498.81 -- -- 800,400.54
USD 1.00 6.1528 6.15 1.00 6.0969 6.10
HKD 123.80 0.7938 98.27 223.80 0.7862 175.96
Bank deposits -- -- 3,369,087.91 -- -- 55,530,057.62
RMB -- -- 3,366,176.19 -- -- 55,529,534.71
USD 24.66 6.1528 151.73 24.67 6.0969 150.42
HKD 3,477.16 0.7938 2,759.99 474.19 0.7862 372.49
Total -- -- 4,202,691.14 -- -- 56,330,640.22
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
2. Accounts receivable
(1) Disclosure of accounts receivable by category
Unit: RMB Yuan
Closing balance Opening balance
Category Book value Provision for bad debts Book value Provision for bad debts
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Accounts receivable with
significant individual 12,080,547. 12,080,547. 12,032,29 12,032,292.6
59.40% 100.00% 41.53% 100.00%
amount which individually 05 05 2.69 9
assessed for bad debts
Accounts receivable of provision for bad debts withdrawing by groups
Accounts receivable with
insignificant individual 5,499,087.8 2,688,161.2 14,196,43
amount but in high risk 27.03% 48.88% 49.00% 2,972,561.25 20.94%
portfolio after grouping by 3 5 5.01
credit risk characteristics
Accounts receivable with
significant individual 2,171,089.2 1,067,146.6 2,151,364
amount in high risk 10.67% 49.15% 7.43% 1,067,146.69 49.60%
portfolio after grouping by 5 9 .27
credit risk characteristics
7,670,177.0 3,755,307.9 16,347,79
Subtotal 37.70% 48.96% 56.43% 4,039,707.94 24.71%
8 4 9.28
Accounts receivable with
insignificant individual 590,329.9
amount but withdrawing 590,329.99 2.90% 590,329.99 100.00% 2.04% 590,329.99 100.00%
by individual for provision 9
for bad debts
20,341,054. 16,426,184. 28,970,42 16,662,330.6
Total -- -- -- --
12 98 1.96 2
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
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Unit: RMB Yuan
Provision for bad Withdrawing
Contents of accounts receivable Book value Reason of provision
debts Proportion
Because the
significant client
Victoria International
(USA) INC had filed
for bankruptcy and
had significant
influence on it. It’s
likely to have bad
debts after analysis
Victoria International(USA) INC 5,311,259.82 5,311,259.82 100.00%
and evaluation, the
Company withdrawn
the bad debt of 100%
of the closing
balance which was of
RMB 5,311,259.82
based on
conservatism
principle.
Estimated to be
Hong Kong Jinhua Trading Company 4,224,304.63 4,224,304.63 100.00% irrecoverable for long
age
Estimated to be
Jinjing International Co., Ltd. 2,544,982.60 2,544,982.60 100.00% irrecoverable for long
age
Total 12,080,547.05 12,080,547.05 -- --
Accounts receivable with insignificant individual amount but withdrawing by individual for provision for bad debts at the end of
period
√ Applicable □ Inapplicable
Unit: RMB Yuan
Contents of accounts
Book value Provision for bad debts Withdrawing proportion Withdrawing reason
receivable
Shenzhen ITAT Estimated to be
206,357.74 206,357.74 100.00%
International Premier irrecoverable for long
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Brand Garment Co., Ltd. age
Estimated to be
Guangzhou Chen
335,904.80 335,904.80 100.00% irrecoverable for long
Shunqin
age
Estimated to be
Ningbo Industrial and
26,354.45 26,354.45 100.00% irrecoverable for long
Commercial Bureau
age
Estimated to be
Capital Airport 21,713.00 21,713.00 100.00% irrecoverable for long
age
Total 590,329.99 590,329.99 -- --
(2) Top 5 units in outstanding amount of accounts receivable
Unit: RMB Yuan
Percent in total accounts
Name of unit Relationship Amount Age limit
receivable
Victoria International
Customer 5,311,259.82 Over 3 years 26.11%
(USA) INC
Hong Kong Jinhua
Customer 4,224,304.63 Over 3 years 20.77%
Trading Company
Jinjing International Co.,
Customer 2,544,982.60 Over 3 years 12.51%
Ltd.
Chen Dantao Customer 2,479,757.46 Within 1 year 12.19%
Brendwood International
Customer 2,171,089.25 1 to 3 years 10.67%
Corp.
Total -- 16,731,393.76 -- 82.25%
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(3) Accounts receivable with insignificant individual amount but in high risk portfolio after grouping by
credit risk characteristics
Aging Closing balance Opening balance
Book value Provision for bad debts Book value Provision for bad
Amount Proportion Amount Proportion debts
Within 1 year 2,762,652.82 50.24 10,770,000.00 75.86% 215,400.00
1 to 2 years 1,800.53 0.03 180.05 691,800.53 4.87% 69,180.05
2 to 3 years
over 3 years 2,734,634.48 49.73 2,687,981.20 2,734,634.48 19.27% 2,687,981.20
Total 5,499,087.83 100.00 2,688,161.25 14,196,435.01 100.00% 2,972,561.25
3. Other receivables
(1) Disclosure of other receivables by category
Unit: RMB 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 2,331,608.20 3.11% 2,331,608.20 100.00% 2,331,608.20 4.62% 2,331,608.20 100.00%
individually assessed for
bad debts
Other accounts receivable of provision for bad debts withdrawing by groups
Other receivables with
insignificant individual 22,616,120.1 16,879,629.9 26,324,466.1
30.17% 74.64% 52.20% 18,692,429.02 71.01%
amount but in high risk 0 0 4
portfolio after grouping
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
by credit risk
characteristics
Other receivables with
significant individual 47,218,650.0 18,500,000.0
62.99% 370,000.00 0.78% 36.68% 370,000.00 2.00%
amount and grouping by 0 0
credit risk characteristics
69,834,770.1 17,249,629.9 44,824,466.1
Subtotal 93.16% 24.70% 88.88% 19,062,429.02 42.53%
0 0 4
Other receivables with
insignificant individual
amount but individually 2,793,731.62 3.73% 2,793,731.62 100.00% 3,277,927.36 6.50% 3,277,927.36 100.00%
withdrawing bad debt
provision.
74,960,109.9 22,374,969.7 50,434,001.7
Total -- -- -- 24,671,964.58 --
2 2 0
Other accounts receivable with significant individual amount which individually assessed for bad debts at the end
of the period
√ Applicable □ Inapplicable
Unit: RMB Yuan
Withdrawing proportion
Contents Book value Amount of bad debts Reason
(%)
Retained balance has not
Export drawback
2,331,608.20 2,331,608.20 100.00% been processing in
receivable
previous year.
Total 2,331,608.20 2,331,608.20 -- --
(2) Other accounts receivable returned or collected during the reporting period
Unit: RMB Yuan
Note to other receivables with insignificant individual amount but in high risk portfolio after grouping by credit risk characteristics
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Aging Closing balance Opening balance
Book value Provision for bad Book value Provision for bad
Amount Proportion (%) debts Amount Proportion (%) debts
Within 1 year 3,041,193.12 13.45% 95,238.25 4,761,912.60 18.09% 95,238.25
1 to 2 years 467,908.86 2.07% 23,764.46 237,644.62 0.90% 23,764.46
2 to 3 years 535,174.31 2.37% 428,360.13 856,720.25 3.25% 428,360.13
over 3 years 18,571,843.81 82.11% 16,332,267.06 20,468,188.67 77.76% 18,145,066.18
Total 22,616,120.10 100.00% 16,879,629.90 26,324,466.14 100.00% 18,692,429.02
(3) Other accounts receivable due to the top five entities
Unit: RMB Yuan
Proportion in the total
Relationship with the
Name of entity Amount Years other accounts receivable
Company
(%)
Puning Huafengqiang
Supplier 19,758,650.00 Within 1 year 26.36%
Trade Co., Ltd.
Puning Yanglilai Trading
Supplier 13,800,000.00 Within 1 year 18.41%
Co., Ltd.
Shenzhen Zhili
Yongheng Trading Co., Supplier 8,500,000.00 Within 1 year 11.34%
Ltd.
Shenzhen Julian
Shangmao Trading Co., Supplier 5,160,000.00 Within 1 year 6.88%
Ltd.
Export drawback The competent tax
2,331,608.20 Over 3 years 3.11%
receivable offices
Total -- 49,550,258.20 -- 66.10%
4. Prepayment
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(1) List by aging analysis
Unit: RMB Yuan
Closing balance Opening balance
Aging Proportion Proportion
Amount Amount
(%) (%)
Within 1 year 41,673,185.30 98.30% 9,126,950.50 92.68%
2-3 years 720,584.00 1.70% 720,584.00 7.32%
Total 42,393,769.30 -- 9,847,534.50 --
(2) Information of the top 5 prepayment
Unit: RMB Yuan
Relationship with the
Name of entity Amount Aging Reason for unsettled
Company
Shenzhen Zhongjian
In the period of contract
Hongji Construction & Builder 14,100,000.00 2013
execution
Engineering Co., Ltd.
Puning Lailisheng In the period of contract
Supplier 13,600,000.00 2013
Trading Co., Ltd. execution
Puning Xingsong In the period of contract
Builder 5,000,000.00 2013
Trading Co., Ltd. execution
Guangzhou Guansheng
In the period of contract
Steel Structure Supplier 4,000,000.00 2013
execution
Engineering Co., Ltd.
Puning Yuxing Trading In the period of contract
Supplier 4,000,000.00 2014
Co., Ltd. execution
Total -- 40,700,000.00 -- --
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
5. Inventory
(1) Category
Unit: RMB Yuan
Closing balance Opening balance
Item Impairment of Impairment of
Book balance Book value Book balance Book value
inventories inventories
Inventory goods 813,803.51 813,803.51 1,737,707.86 1,737,707.86
Completed
development 229,705,047.47 229,705,047.47 263,030,203.16 263,030,203.16
products
Total 230,518,850.98 230,518,850.98 264,767,911.02 264,767,911.02
6. Fixed assets
(1) Notes of fixed assets
Unit: RMB Yuan
Opening book Decrease in the
Item Increase in the period Closing book value
value period
1. Total of book value: 127,041,031.06 127,041,031.06
Including: Buildings and
119,088,227.16 119,088,227.16
constructions
Machinery
165,411.00 165,411.00
equipment
Transportation
6,249,936.48 6,249,936.48
equipment
Office equipment and others 1,537,456.42 1,537,456.42
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
43,293,349.15 2,018,958.52 45,312,307.67
depreciation:
Including: Buildings and
38,993,729.74 1,601,098.68 40,594,828.42
constructions
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Machinery
69,141.50 7,857.02 76,998.52
equipment
Transportation
3,269,206.22 327,281.82 3,596,488.04
equipment
Office equipment and others 961,271.69 82,721.00 1,043,992.69
Opening book Ending balance in
-- --
value the period
3. Total of carrying amount
83,747,681.91 -- 81,728,723.39
of fixed assets
Including: Buildings and
80,094,497.42 -- 78,493,398.74
constructions
Machinery
96,269.50 -- 88,412.48
equipment
Transportation
2,980,730.26 -- 2,653,448.44
equipment
Office equipment and others 576,184.73 -- 493,463.73
4. Total of Depreciation reserves --
Machinery
83,747,681.91 -- 81,728,723.39
equipment
Office equipment and others 80,094,497.42 -- 78,493,398.74
96,269.50 -- 88,412.48
5. Total of carrying amount
2,980,730.26 -- 2,653,448.44
of fixed assets
Including: Buildings and
576,184.73 -- 493,463.73
constructions
The current depreciation is RMB 2,018,958.52; the cost price of the fixed assets transferred from construction in
progress is RMB 0.00
7. Project materials
Unit: RMB Yuan
Increase in the Decrease in the
Item Opening balance Closing balance
period period
Gravel and others 54,526.00 0.00 0.00 54,526.00
Total 54,526.00 54,526.00
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
8. Intangible assets
(1) Notes of intangible assets
Unit: RMB 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
6,985,541.91 336,594.12 7,322,136.03
amortization
Land use right 6,612,426.91 336,594.12 6,949,021.03
Computer software 373,115.00 373,115.00
3. Total of carrying amount
27,046,989.09 -336,594.12 26,710,394.97
of intangible assets
Land use right 27,046,989.09 -336,594.12 26,710,394.97
Computer software 0.00 0.00 0.00
Fourth. Total of depreciation
0.00 0.00 0.00
reserves
Land use right 0.00 0.00 0.00
Computer software 0.00 0.00 0.00
Total of carrying amount of
27,046,989.09 -336,594.12 26,710,394.97
intangible assets
Land use right 27,046,989.09 -336,594.12 26,710,394.97
Computer software 0.00 0.00 0.00
Amortization of the period is RMB 336,594.12.
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: RMB Yuan
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Item Closing balance Opening balance
Deferred income tax assets:
Provision for impairment of assets 6,465,124.51 7,110,473.23
Subtotal 6,465,124.51 7,110,473.23
Deferred income tax liabilities:
Notes of unrecognized deferred income tax assets
Unit: RMB Yuan
Item Closing balance Opening balance
Deductible temporary difference 1,637,841.05 1,637,841.05
Total 1,637,841.05 1,637,841.05
(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: RMB 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 6,465,124.51 7,110,473.23
10. Notes of impairment assets
Unit: RMB Yuan
Opening book Increase in the Decrease in the period Closing book
Item
balance period balance
Reversal Written off
I. Provision for bad debts 41,334,295.20 2,533,140.50 38,801,154.70
XII. Intangible assets depreciation reserves 0.00 0.00 0.00
Total 41,334,295.20 2,533,140.50 38,801,154.70
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
11. Short-term borrowing
12. Accounts payable
(1) Notes of accounts payable
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 3,917,117.00 590,656.60
1 to 2 years 10,263,139.73 11,830,030.61
2 to 3 years 8,326.90 8,326.90
over 3 years 481,458.09 481,458.09
Total 14,670,041.72 12,910,472.20
13. Deposit received
(1) Notes of deposit received
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 10,641,500.00 33,871,647.00
1 to 2 years 5,820,000.00 20,249,064.66
2 to 3 years 11,810,961.90 85,283.00
over 3 years 125,104.24 39,821.24
Total 28,397,566.14 54,245,815.90
14. Payroll payable
Unit: RMB Yuan
Item Opening book value Increase in the period Decrease in the period Closing book value
1. Salaries and
wages, bonus,
509,288.02 2,149,082.02 2,169,019.26 489,350.78
allowance and
subsidies
2. Employee welfare 60,786.36 16,045.62 44,740.74
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
3. Social insurance 149,547.67 149,547.67
4. Housing welfare
24,115.40 24,115.40
fund
Total 570,074.38 2,322,745.09 2,358,727.95 534,091.52
In payroll payable, the amount in arrears is RMB 0.
The amount of the labour union expenditure and the personnel education fund is RMB 0. The amount o-f compensation for
termination of labor relations is RMB 0.
The Expected issue time and the amount of payroll payable have not been decided.
According to the regulations of local governments pay social insurance policy, the Company combing with its own actual situation,
gradually perfected the implementation of actual policy and payment standards of paying employee’s social security.
15. Taxes payable
Unit: RMB Yuan
Item Closing balance Opening balance
VAT -111,281.12 -317,870.51
Business Tax 9,207,490.67 10,481,731.69
Enterprise Income Tax 9,044,769.75 14,572,976.86
Land Appreciation Tax 6,888,824.46 7,525,367.72
Others 2,056,688.36 3,279,379.70
Total 27,086,492.12 35,541,585.46
16. Other payables
(1) Notes
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 1,871,945.04 11,918,259.76
1 to 2 years 865,012.08 838,101.18
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
2 to 3 years 380,523.28 3,209,200.39
over 3 years 4,034,518.63 1,183,023.50
Total 7,151,999.03 17,148,584.83
17. Share capital
Unit: RMB 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
18. Capital reserve
Unit: RMB Yuan
Item Opening balance Increase in the period Decrease in the period Closing balance
Share capital premium 52,129,496.58 0.00 0.00 52,129,496.58
Other capital reserve 0.00 0.00 0.00 0.00
Total 52,129,496.58 52,129,496.58
19. Surplus reserve
Unit: RMB Yuan
Item Opening balance Increase in the period Decrease in the period Closing balance
Statutory Surplus Reserves 49,036,260.20 0.00 0.00 49,036,260.20
Discretionary surplus reserves 37,000,000.00 0.00 0.00 37,000,000.00
Reserve funds 0.00 0.00 0.00 0.00
Enterprise development fund 0.00 0.00 0.00 0.00
Other 0.00 0.00 0.00 0.00
Total 86,036,260.20 86,036,260.20
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
20. Retained profit
Unit: RMB Yuan
Proportion of extract or
Item Amount
distribution
Undistributed profit at the end of previous year
-94,265,581.12 --
before adjustment
Total undistributed profit at beginning of
-94,265,581.12 --
adjustment year
Increase：Net profit attributable to owner of parent
4,188,028.05 --
company this year
Undistributed profit at the end of the period -90,077,553.07 --
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 und
istributed 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 the ye
ar 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.
21. Operating revenue and operating cost
(1) Operating revenue and operating cost
Unit: RMB Yuan
Item Reporting period Same period of last year
Income from main operations 56,573,047.35 101,392,043.00
Cost of operations 37,129,693.39 66,551,899.59
(2) Main operations (by industry)
Unit: RMB Yuan
Industry Reporting period Same period of last year
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Operating revenue Operating cost Operating revenue Operating cost
Real estate 52,379,119.00 33,325,155.69 101,392,043.00 66,551,899.59
Wholesale and retail industry 4,193,928.35 3,804,537.70
Total 56,573,047.35 37,129,693.39 101,392,043.00 66,551,899.59
(3) Main operations (by product)
Unit: RMB Yuan
Reporting period Same period of last year
Product
Operating revenue Operating cost Operating revenue Operating cost
Commercial residential building 52,379,119.00 33,325,155.69 101,392,043.00 66,551,899.59
Rough stone block 4,193,928.35 3,804,537.70
Total 56,573,047.35 37,129,693.39 101,392,043.00 66,551,899.59
(4) Main operations (by region)
Unit: RMB Yuan
Reporting period Same period of last year
Region
Operating revenue Operating cost Operating revenue Operating cost
Domestic wholesale and retail 4,193,928.35 3,804,537.70
Domestic sales of real estate 52,379,119.00 33,325,155.69 101,392,043.00 66,551,899.59
Total 56,573,047.35 37,129,693.39 101,392,043.00 66,551,899.59
(5) Notes of TOP 5 Customers of the operating revenue
Unit: RMB Yuan
Name of customer Operating revenue Percent in total operating revenue of the Company (%)
Customer 1 9,764,557.00 17.26%
Customer 2 2,375,861.08 4.20%
Customer 3 1,085,660.00 1.92%
Customer 4 1,005,242.00 1.78%
Customer 5 1,000,000.00 1.77%
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Total 15,231,320.08 26.93%
Note:
22. Operating revenue and surcharges
Unit: RMB Yuan
Item Reporting period Same period of last year Standard (%)
Business tax 2,618,955.95 5,069,602.15 5%
City maintenance and construction
183,326.92 354,872.15 7%、5%
tax
Education expenses and surcharges 133,074.17 253,480.11 3%、2%
Ordinary curtilage at 3% of the income,
Land value increment tax 1,812,135.30 3,248,331.95 non-ordinary curtilage at 3.5% of the
income to prepay.
Total 4,747,492.34 8,926,286.36 --
23. Selling expenses
Unit: RMB Yuan
Item Reporting period Same period of last year
Selling expenses 204,936.34 364,306.74
Total 204,936.34 364,306.74
24. Administration expense
Unit: RMB Yuan
Item Reporting period Same period of last year
Administration expense 7,661,332.06 9,675,497.18
Total 7,661,332.06 9,675,497.18
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
25. Financial expense
Unit: RMB Yuan
Item Reporting period Same period of last year
Interest expenses 832,600.00 2,717,458.33
Less: Interest income -5,376.38 6,885.03
Exchange loss 42,486.74
Less: Exchange gain 64,493.26
Service fee expense 11,323.32 16,861.89
Total 881,033.68 2,662,941.93
26. Asset impairment loss
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Bad debt loss -2,533,140.50 -92,192.59
Total -2,533,140.50 -92,192.59
27. Non-operating revenue
(1) Notes
Unit: RMB Yuan
Amount of the included
Item Reporting period Same period of last year non-recurring gains and
losses of the current period
Others 2,033.00 6,875.00 2,033.00
Total 2,033.00 6,875.00 2,033.00
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
28. Non-operating expenses
Unit: RMB Yuan
Amount o included in
non-recurring gains and
Item Reporting period Same period of last year
losses of the current
period
Including: loss on disposal of fixed assets 9,326.17
Donation expenses 530,000.00 150,000.00 530,000.00
Surcharge expenditures 1,035.62 101,690.78 1,035.62
Total 531,035.62 261,016.95 531,035.62
Note:
29. Income tax expenses
Unit: RMB Yuan
Item Reporting period Same period of last year
Income tax for current period calculated by tax law and
3,203,901.26 5,900,592.79
relevant regulations
Deferred income tax adjustment 574,248.72
Total 3,778,149.98 5,900,592.79
30. Basic earnings per share and diluted earnings per share
Profit of the reporting period Weighted average ROE EPS
Basic EPS Diluted EPS
Net profit attributable to ordinary 1.15% 0.013 0.013
shareholders of the Company
Net profit attributable to ordinary 1.22% 0.0139 0.0139
shareholders of the Company after
deducting non-recurring gain or loss
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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.
(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
88
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
31. Notes to cash flow statement
(1) Other cash received relevant to operating activities
Unit: RMB Yuan
Item Amount
Other loans received 14,470,000.00
Other received relevant to operating activities 2,246,093.88
Total 16,716,093.88
(2) Other cash paid relevant to operating activities
Unit: RMB Yuan
Item Amount
Other current payments paid 53,580,000.00
Audit and other intermediary fees paid 350,149.72
Fees relevant to operating activities paid 7,066,833.96
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Total 60,996,983.68
32. Supplementary information for cash flow statement
(1) Supplementary information for cash flow statement
Unit: RMB Yuan
Supplemental information Reporting period Same period of last year
1. Reconciliation of net profit to net cash flows generated
-- --
from operating activities
Net profit 4,174,547.44 7,148,569.05
Add: Provision for assets impairment -92,192.59
Depreciation of fixed assets, of oil-gas assets, of productive
2,018,958.52 2,223,117.85
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
negative)
Financial cost (gains: negative) 2,652,965.07
Decrease in deferred income tax assets (gains: negative) 645,348.72
Decrease in inventory (gains: negative) 34,249,060.04 66,551,899.59
Decrease in accounts receivable from operating activities
366,880,177.03 -21,725,756.61
(gains: negative)
Increase in payables from operating activities (decrease:
-460,432,647.77 -53,295,495.67
negative)
Other 66,390.23
Net cash flows generated from operating activities -52,127,961.90 3,875,417.21
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 4,202,691.14 24,066,267.29
Less: Opening balance of cash 56,330,640.22 21,555,492.79
Net increase in cash and cash equivalents -52,127,949.08 2,510,774.50
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
(2) The composition of cash and cash equivalents
Unit: RMB Yuan
Item Closing amount Opening amount
I. Cash 4,202,691.14 56,330,640.22
Of which: cash in hand 833,603.23 800,582.60
Other monetary capital available for payment at any
3,369,087.91 55,530,057.62
time
III. Balance of cash and cash equivalents at the period-end 4,202,691.14 56,330,640.22
VIII. Related party and related Transaction
1. Information related to parent company of the Company
Proportion
Proportion
of voting
of share
rights The
held by
Name of Legal Name of owned by ultimate
Relationsh Registratio Business parent Organizati
parent Type representat parent parent controller
ip n of place scope company on code
company ive company company of the
against the
against the Company
Company
Company
(%)
(%)
A 403,
Floor 4 of
Light
Shenzhen
industrial
Shengheng Controllin
factory Chen
chang g Limited Ding 74122232-
building, Trade 98000000 36.99% 36.99% Hongchen
Huifu shareholde liability Ligong 1
Nanshan g
Industrial r
Avenue,
Co., Ltd.
Nanshan
District,
Shenzhen
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
2. Information of subsidiaries
Legal Shareholdin
Type of Place of Registered Voting Code of
Name Type representati Nature gs
subsidiaries Registration capital (%) organization
ve (%)
Shenzhen
Rieys Holding
Co., Ltd. Shenzhen Xu Wei Trading 50,000,000 90.00% 90.00% 72615364-7
Industrial Subsidiary
Co., Ltd.
Puning Production
Tianhe and sales of
Garment Holding Wang clothes and 65,100,000( 73412802-
Co., Ltd. Puning 100.00% 100.00%
Manufacturi Subsidiary Shaolun knitting HKD) X
ng Factory colorized
Co., Ltd. cloth
Tianrui
(HK) Holding Li 35181491-0
Co., Ltd. Hong Kong Trading 1(USD) 100.00% 100.00%
Trading Subsidiary GuoQiang 00-11-12-8
Co., Ltd.
Puning
Hengda Property
Holding
Real Estate Co., Ltd. Puning Chen Yuyi developmen 26,000,000 100.00% 100.00% 69479921-5
Subsidiary
Developme t
nt Co., Ltd.
Shenzhen
Yingda
Chuangyua Municipal public
n Holding
engineering, real
Co., Ltd. Shenzhen Xu Wei １ 100.00% 100.00% 07036496-9
Constructio Subsidiary estate
n development etc.
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. 72470265-7
Company, affiliate controlled under Chen
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Hongcheng’s family
Shareholder holding 3.81% stake of the
Shenzhen Lianhua Huiren Industrial Co.,
Company, affiliate controlled under Chen 23175521-6
Ltd.
Hongcheng’s family
Chen Xuewen Direct relatives of Cheng Hongcheng,
Vice-Board chairman of the Company,
relative of Cheng Hongcheng, and Ding
Ding Lihong Lihong is the legal representative of parent
company and Shenzhen Rishen Investment
Co., Ltd.
Affiliate controlled under Chen
Ya’an Zhengxing Marble Co., Ltd. 21130529-3
Hongcheng
4. Related parties transactions
(1) Information sheet of purchasing goods and receiving services
Unit: RMB Yuan
Reporting period Same period of last year
Proportio Proportio
Content of related Pricing principle n in n in
Name of company
transaction of related parties Amount transactio Amount transactio
ns of the ns of the
same kind same kind
Conducted
corresponding
This period, the
decision process
Company was
according to
Ya’an Zhengxing purchasing stone
transaction 3,370,341.00 100.00% 0.00 0.00%
Marble Co., Ltd. material from Ya’an
amount and using
Zhengxing Marble
the market price
Co., Ltd.
of Ya’an
Zhengxing
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Marble Co., Ltd.
5. Accounts receivable of related parties
Accounts receivable of listed company
Unit: RMB Yuan
Item Related party Closing amount Opening amount
Ya’an Zhengxing Marble Co.,
Amount of purchasing stone material 3,095,135.00 224,794.00
Ltd.
IX. Commitments
1. Significant commitments
(1) Assets mortgage and guarantee
1.In current period, the Company continued to mortgage its real estate(The mortgaged property assessment value was RMB 50.13
million) 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, 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.
The book value of aforesaid fixed assets and intangible assets was RMB 40,233,548.69, net value was RMB 30,874,418.44.
On 14 Apr. 2014 the Company mortgaged its real estate (the mortgaged property assessment value was RMB 39.43 million), for
Puning Yanlilai Trading Co., Ltd. and 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 in 2014
NO. 3943 of RongCheng sub-branch. The secured principle credit was from 14Apr. 2014 to 14Apr. 2019. Puning Yanlilai Trading
Co., Ltd. obtained RMB 24 million from Jieyang RongCheng sub-branch of The Industrial and Commercial Bank of China Co., Ltd.
which was the guarantee for the Company.
The book value of aforesaid fixed assets and intangible assets was RMB 29,975,650.99, net value was RMB 20,438,520.82.
X. Other significant events
1. Sustainable operation ability of the Company
[ Since 30 years of the reform and opening up, the urbanization construction achievements of the Country was
obvious. According to the spirit of the Eighteenth National Congress of the Communist Party of China, the
government proposed the development plan of building a well-off society in an all-round way in China in 2020,
good news such as speeding up the establishment of a new type of urbanization,; the next six years, real estate
industry still has a huge development space and opportunities.
However, as the changes of economic environment changes, the real estate market supply entered a relative supply
surplus environment of buyer's market. Facing higher and higher quality and service requirement of the house and
the increasingly normative legal environment of the national regulation, and the influence of factors such as
limited capital crunch, land supply, buyers lower expectations, the development of small and medium-sized real
estate enterprises will face more and more challenges.
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
In, 2013, the government did not change the controlling keynote of real estate, the market direction of maintain it
in some areas while reducing it in others. The central economic work conference was held in 2013, the
government ensured the idea of economic control, which was “Steady growth and restructuring” and paying more
attention to promote the long-term health of the real estate market development through the establishment of a
long-term mechanism. In 2013, the Company continued to grasp management concept of “seeking improvement
in stability” actively response to market regulations, on the basis of good performance in products sale, actively
expand a number of real estate projects and discussed the subsequent project. But due to comprehensive
consideration of factors such as the relevant risks and benefits cycle by the Company, the subsequent project was
failed to determine in the end. At the same time, the Company planed a major asset reorganization matters and
discusses the diversified development direction during delisting from 22 Jun. 2013 to 26 Jul.
In 2014, facing the increasingly market-oriented and external situation of fierce competition, the Company will set
out actually from itself, give play to their own advantages, ensure the correct market orientation, constantly blaze
new trails, from the financing strategy, talent strategy, brand culture strategy, personalized service strategy,
moderate land reserve strategy, etc Set up development direction in accordance with the characteristics of the
company, and gradually improve competitiveness. In the follow-up, the Company will make greater efforts to
expand the intensity of development, on the premise of risk control, carry out the follow-up project as soon as
possible, at same tine, on the premise of doing well in real estate follow-up project development work, the
Company also will continue to explore appropriate diversified operation, look for other profit growth point, to
ensure the sustainable development of the Company. ]
XI. 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 100.00
Proportion Amou Proportion Proportion Proportion
significant individual Amount Amount
(%) nt (%) (%) (%) %
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 --
Accounts receivable with significant individual amount and single provision for bad debts
√ Applicable □ Inapplicable
Unit: RMB Yuan
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Provision for bad
Content of accounts receivable Book balance Provision ratio Reasons
debts
Long-term credit, the
Hong Kong Jinhua Trading Company 4,224,304.63 4,224,304.63 100.00% balance is
controversial
Long-term credit, the
Guangzhou Chen Shunqin 335,904.80 335,904.80 100.00% balance is
controversial
Long-term credit, the
Ningbo Industrial and Commercial
26,354.45 26,354.45 100.00% balance is
Bureau
controversial
Long-term credit, the
Content of accounts receivable 21,713.00 21,713.00 100.00% balance is
controversial
Total 4,608,276.88 4,608,276.88 -- --
(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
Content of accounts
Client 21,713.00 Over 3 years 0.47%
receivable
Total -- 4,608,276.88 -- 100.00%
2. Other receivables
（1）Other receivables
Unit: RMB Yuan
Closing balance Opening balance
Category Provision for bad
Book balance Provision for bad debts Book balance
debts
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Propo Propo Propo Propo
rtion rtion rtion rtion
Amount Amount Amount Amount
(%) (%) (%) (%)
Accounts receivable with
Proportion Amou Proportion Amou Proportion Amou Proportion
significant individual 4.32%
(%) nt (%) nt (%) nt (%)
amount
Accounts receivable according to the combination of provision for bad debts
Other individually
insignificant accounts
48.72 28.90
receivable but in high risk 2,043,895.85 2.24% 995,868.18 3,445,625.51 4.73% 995,868.18
% %
portfolio after grouping by
credit risk characteristics
Accounts receivable with
significant individual 21.68
19,758,650.00 0.00 0.00%
amount and withdrawing by %
credit risk characteristics
23.93 48.72 28.90
Subtotal of the group 21,802,545.85 995,868.18 3,445,625.51 4.73% 995,868.18
% % %
Other individually
insignificant accounts
99.83 99.83
receivable but individually 1,480,776.36 1.62% 1,478,227.36 1,480,777.36 2.04% 1,478,227.36
% %
withdrawing bad debt
provision
Total 91,142,491.49 -- 5,405,703.74 -- 72,785,572.15 -- 5,405,703.74 --
Other individually significant accounts receivable and individually withdrawing bad debt provision
√Applicable □Inapplicable
Unit: RMB Yuan
Content of other
Book balance Bad debts Provision ratio Reasons
receivables
Shenzhen Zhao Tong Payment of long-term,
600,000.00 600,000.00 100.00%
Investment Co., Ltd. the Company estimated it
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
was irrecoverable
Subsidiary, did not
Tianrui (HK) Trading
64,927,561.08 0.00 0.00% withdraw bad debt
Co., Ltd.
provision
Retained balance in
Receivables of export
2,331,608.20 2,331,608.20 100.00% previous years not yet
rebates
been deal with.
Total 67,859,169.28 2,931,608.20 -- --
Other individually insignificant accounts receivable but individually withdrawing bad debt provision at period-end
√Applicable □Inapplicable
Unit: RMB Yuan
Content of other
Book balance Bad debts Provision ratio Reasons
receivables
Payment of long-term,
Lin Jialin 300,000.00 300,000.00 100.00% the Company estimated it
was irrecoverable
Payment of long-term,
Cai Weixian 9,500.00 9,500.00 100.00% the Company estimated it
was irrecoverable
Payment of long-term,
Cash deposit 3,000.00 3,000.00 100.00% the Company estimated it
was irrecoverable
Payment of long-term,
Puning Weililai Textile
50,000.00 50,000.00 100.00% the Company estimated it
Co., Ltd.
was irrecoverable
Shenzhen Jinmingren Payment of long-term,
Information Consultation 200,000.00 200,000.00 100.00% the Company estimated it
Company was irrecoverable
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Payment of long-term,
Zong Lvquan 100,000.00 100,000.00 100.00% the Company estimated it
was irrecoverable
Payment of long-term,
Shenzhen Youtianda
205.00 205.00 100.00% the Company estimated it
Industrial Co., Ltd.
was irrecoverable
Shenzhen Yingda
Subsidiary, did not
Chuangyuan
2,549.00 0.00 0.00% withdraw bad debt
Construction Investment
provision
Co., Ltd.
Payment of long-term,
Changsha hatting factory 10,542.95 10,542.95 100.00% the Company estimated it
was irrecoverable
Shenzhen Baoan
Payment of long-term,
Gongming Qixing Jianye
200,000.00 200,000.00 100.00% the Company estimated it
Building Materials Sales
was irrecoverable
Department
Guangzhou Nanxiang Payment of long-term,
Building Engineering 500,000.00 500,000.00 100.00% the Company estimated it
Company was irrecoverable
Payment of long-term,
Chen Hanbiao 3,600.00 3,600.00 100.00% the Company estimated it
was irrecoverable
Payment of long-term,
Chengde Xingye Paper
89,229.41 89,229.41 100.00% the Company estimated it
Co., Ltd.
was irrecoverable
Changsha Guanyuan Payment of long-term,
12,150.00 12,150.00 100.00%
Closing Co., Ltd. the Company estimated it
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
was irrecoverable
Total 1,480,776.36 1,478,227.36 -- --
(2) Provision for bad debt provision of other individually insignificant accounts receivable but individually
impairment testing
Content of other receivables Book balance Bad debts Provision ratio Reasons
Receivable of export drawback 2,331,608.20 2,331,608.20 100.00% Retained balance did not
been processing in
previous years
Guangzhou Nanxiang Building Engineering 500,000.00 500,000.00 100.00% Payment of long-term,
Company the Company estimated
it was irrecoverable
Shenzhen Zhaotong Investment Co., Ltd. 600,000.00 600,000.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Lin Jialin 300,000.00 300,000.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Shenzhen Baoan Gongming Qixing Jianye 200,000.00 200,000.00 100.00% Payment of long-term,
Building Materials Sales Department the Company estimated
it was irrecoverable
Shenzhen Jinmingren Information 200,000.00 200,000.00 100.00% Payment of long-term,
Consultation Company the Company estimated
it was irrecoverable
Zong Lvquan 100,000.00 100,000.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Chengde Xingye Paper Co., Ltd. 89,229.41 89,229.41 100.00% Payment of long-term,
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
the Company estimated
it was irrecoverable
Puning Weililai Textile Co., Ltd. 50,000.00 50,000.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Changsha Guanyuan Closing Co., Ltd. 12,150.00 12,150.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Changsha hatting factory 10,542.95 10,542.95 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Cai Weixian 9,500.00 9,500.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Chen Hanbiao 3,600.00 3,600.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Cash deposit 3,000.00 3,000.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Shenzhen Youtianda Industrial Co., Ltd. 205.00 205.00 100.00% Payment of long-term,
the Company estimated
it was irrecoverable
Total 4,409,835.56 4,409,835.56
(3) Top 5 in outstanding amount of other receivables in period-end
Unit: RMB Yuan
Relationship with the Proportion in total other
Name of unit Amount Aging
Company receivable (%)
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Tianrui (HK) Trading
Subsidiary 64,927,561.08 Over 3 years 73.52%
Co., Ltd.
Puning Rieys Paper
Client 19,758,650.00 Within 1 year 22.37%
Industrial Co., Ltd.
Receivable of export tax The competent tax
2,331,608.20 Over 3 years 2.64%
rebates offices
Guangdong Yuanfeng
Supplier 700,000.00 Over 3 years 0.79%
Trade Co., Ltd.
Shenzhen Zhaotong
Supplier 600,000.00 Over 3 years 0.68%
Investment Co., Ltd.
Total -- 89,150,419.28 -- 96.90%
(4) Other individually insignificant accounts receivable but in high risk portfolio after grouping by credit
risk characteristics
Aging Closing amount Opening amount
Book balance Bad provision Book balance Bad provision
Amount % Amount %
Within 1 year 924,202.23 45.22% 46,219.86 2,310,993.04 67.07% 46,219.86
1-2 years 12,728.94 0.62% 986.21 9,862.12 0.29% 986.21
2-3 years 319,467.60 15.63% 168,212.40 336,424.80 9.76% 168,212.40
Over 3 years 787,497.08 38.53% 780,449.71 788,345.55 22.88% 780,449.71
Total 2,043,895.85 100.00% 995,868.18 3,445,625.51 100.00% 995,868.18
3. Long-term equity investments
Unit: RMB Yuan
Provision
The
Change Stake in Voting in for
Initial Balance Differenc Depreciat current
Audit Opening (increase the the impairme
Investee investmen at year e ion cash
method balance or investee investee nt loss in
t end statement reserves dividends
decrease) (%) (%) current
period
102
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Shenzhen
Rieys Cost 45,000,00 45,000,00 45,000,00
90.00% 90.00%
Industrial method 0.00 0.00 0.00
Co., Ltd.
Puning
Tianhe
Subsidiar
Garment 51,712,50 51,712,50 51,712,50
Cost
Manufact 75.00% 100.00% y holds
method 0.42 0.42 0.42
uring
25%
Factory
Co., Ltd.
Tianrui
(HK) Cost
8.26 8.26
Trading method
Co., Ltd.
Puning
Hengda
Real 146,600,0 146,600,0 146,600,0
Cost
Estate 100.00% 100.00%
method 00.00 00.00 00.00
Develop
ment Co.,
Ltd.
Shenzhen
Yingda
Chuangy
uan
Cost
Construct 1.00 1.00 1.00 100.00% 100.00%
method
ion
Investme
nt Co.,
Ltd.
243,312,5 243,312,5 243,312,5
Total -- 1.00 -- -- --
09.68 08.68 01.42
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 -5,801,300.54 -7,170,879.21
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Depreciation of fixed assets, of oil-gas assets, of productive
1,603,933.20 1,752,915.19
biological assets
Amortization of intangible assets 336,594.12 336,594.12
Financial cost (gains: negative) 2,717,458.33
Decrease in accounts receivable from operating activities (gains:
-19,189,371.39 19,533,754.28
negative)
Increase in payables from operating activities (decrease: negative) 20,734,701.17 -19,171,116.12
Net cash flows generated from operating activities -2,315,443.44 -2,001,273.41
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 3,168,838.86 4,619,037.40
Less: Opening balance of cash 5,484,282.30 7,628,811.81
Net increase in cash and cash equivalents -2,315,443.44 -3,009,774.41
XII. Supplementary information
1. List of current non-recurring gains or losses
Unit: RMB Yuan
Item of non-recurring gains or losses Amount Remark
Received account receivable of
Impairment reverse of account receivable individually
373,144.70 100% withdrawing bad debt
impairment testing
provision
The fine, delaying payment,
Other non-operating income and expense except the above -529,002.62
donations, etc
Less: the affected amount of income tax 93,794.43
Total -249,652.35 --
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2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
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
1.15% 0.0131 0.0131
of the Company
Net profit attributable to common shareholders
of the Company after deducting non-recurring 1.22% 0.0139 0.0139
gains and losses
3. The anomalies in the Company’s financial statements and the reasons
Item Variation amount Variation rate% Remark
Monetary capital -52,127,949.08 -92.54% Due to the increase of prepayment
Account receivable -8,393,222.20 -68.19% Sale of commercial housing, Uncollected receivable was less
than that in last period
Prepayment 32,546,234.80 330.50% Prepayment of engineering did not obtained the invoice and
settlement so far
Other account payable 26,823,103.08 104.12% The increase of current amount
Customer in advance -25,848,249.76 -47.65% The decrease of the pre-sale of housing
Other account -9,996,585.80 -58.29% Paid the loan
receivable
Operating revenue -44,818,995.65 -44.20% The decrease of housing selling amount
Operating cost -29,422,206.20 -44.21% Due to the decrease of housing selling amount
Business tax and -4,178,794.02 -46.81% Due to the decrease of housing selling amount
surcharges
Sale expense -159,370.40 -43.75% The decrease of commercial housing sale expense
Assets impairment loss -2,440,947.91 2,647.66% The subsidiary received the account receivable, rushed back to
the amount of bad debts
Non-operating expense 270,018.67 -103.45% The increase of donation expense
Income tax expense -2,122,442.81 35.97% Due to the decrease of total profits
105
2014 Semi-annual Report of Guangdong Rieys Group Company Ltd.
Section X. Documents Available for Reference
I. Financial report text with signature and seal of legal representative of the financial director;
II. 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.( The report
was compiled by Chinese and English respectively, if the understanding of Chinese and foreign text ambiguity
occur, the Chinese version shall be prevail.)
106
