Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
2021 Annual Report
April 2022
1
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section I. Important Notice, Contents and Paraphrase
Board of Directors, Board of Supervisory, all directors, supervisors and senior
executives of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred
to as The Company) hereby confirm that there are no any fictitious records,
misleading statements, or important omissions carried in this report, and shall
take all responsibilities, individual and/or joint, for the reality, accuracy and
completion of the whole contents.
Sun Xigang, principal of the Company, Wang Huilin, person in charger of
accounting works and Tang Yiqiao, head of accounting organization (accounting
principal) hereby confirm that the Financial Report of Annual Report 2021 is
authentic, accurate and complete.
All directors are attend the Meeting for Report deliberation.
The forward-looking statements such as operation programme involved in the
annual report do not constitute a substantial commitment of the Company to
investors. Investors and relevant persons should maintain sufficient risk
awareness and understand the differences between programme, forecasts and
commitments.
Possible risks that might be countered during the development have been
analyzed in Section III. Management Discussion and Analysis in the Report,
investors are kindly advised to check.
The Company has no plans of cash dividend distributed, no bonus shares and
has no share converted from capital reserve either.
2
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Contents
Section I Important Notice, Contents and Paraphrase ......................................................................... 2
Section II Company Profile and Main Financial Indexes .................................................................... 6
Section III Management Discussion and Analysis ............................................................................. 12
Section IV Corporate Governance ..................................................................................................... 32
Section V Enviornmetnal and Social Responsibility ....................................................................... 55
Section VI Important Events .............................................................................................................. 57
Section VII Changes in shares and particular about shareholders ..................................................... 91
Section VIII Preferred Stock..............................................................................................................98
Section IX Corporate Bonds .............................................................................................................. 99
Section X Financial Report .............................................................................................................. 100
3
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Documents Available for Reference
(i)The financial statement containing signature and seals of the person in charge of the Company, person in charge
of the accounting works and head of accounting organization (accounting principal);
(ii)The original audit report containing the seals of accounting firm and signature and seals of the CPA;
(iii)Original copies of documents and announcements The Company released publicly during the reporting period.
4
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Paraphrase
Items Refers to Contents
The Company, Company Refers to Nanjing Putian Telecommunications Co., Ltd.
CETC Refers to China Electronics Technology Group Corporation
Nanjing Southern Telecom Co., Ltd (controlling subsidiary of the
Southern Telecom Refers to
Company)
Nanjing Putian Telege Intelligent Building Ltd (controlling
Telege Company Refers to
subsidiary of the Company)
Nanjing Nanman Electric Co., Ltd. (wholly-owned subsidiary of
Nanman Company Refers to
the Company)
Nanjing Putian Datang Information Electronic Co., Ltd
Datang Company Refers to
(controlling subsidiary of the Company)
5
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section II Company Profile and Main FinancialIndexes
I Company information
Short form of the stock NJ TEL B Stock code 200468
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in
南京普天通信股份有限公司
Chinese)
Short form of the Company
南京普天
(in Chinese)
Foreign name of the
Nanjing Putian Telecommunications Co., Ltd.
Company(if applicable)
Legal representative Sun Xigang
Registrations add. No.8 Fenghui Avenue, Yuhua Economic Development Zone, Nanjing
Code for registrations add 210039
Registered address of the Company when established in 1997 was No.1 Block, west side of
Ericsson, Jiangning Economic and Technological Development Zone, Nanjing; in 2003, registered
Historical changes of
address changed to No.58, Qinhuai Road, Jiangning Economic and Technological Development
registered address
Zone, Nanjing; and in 2021 registered address changed as No.8 Fenghui Avenue, Yuhua Economic
Development Zone, Nanjing
Putian Technology Pioneer Park, No.8 Fenghui Avenue, Yuhuatai District, Nanjing, Jiangsu
Offices add.
Province
Codes for office add. 210039
Company’s Internet Web Site www.postel.com.cn
E-mail securities@postel.com.cn
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Li Jing Xiao Hong
Putian Technology Pioneer Park, No.8 Putian Technology Pioneer Park, No.8
Contact address Fenghui Avenue, Yuhuatai District, Fenghui Avenue, Yuhuatai District,
Nanjing, Jiangsu Province Nanjing, Jiangsu Province
Tel. 86-25-69675809 86-25-69675865
Fax. 86-25-52416518 86-25-52416518
E-mail lijing@postel.com.cn xiaohong@postel.com.cn
6
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
III. Information disclosure and preparation place
Website of the Stock Exchange where the annual
Shenzhen Stock Exchange (http://www.szse.cn)
report of the Company disclosed
Media and Website where the annual report of the Securities Times; Hong Kong Commercial Daily and Juchao Website
Company disclosed (www.cninfo.com.cn)
Preparation place for annual report Office of the BOD
IV. Registration changes of the Company
Organization code 91320000134878054G
Changes of main business since listing (if
No change
applicable)
When the Company established in 1997, the controlling shareholder was China Post
and Telecommunications Industry Corporation (later changed name to China Putian
Previous changes for controlling CorporationChina Putian Corporation). In 2005, the shares held by China Putian
shareholders (if applicable) CorporationChina Putian Corporation are transferred to China Potevio Company
Limited (China Potevio), the controlling shareholder of the Company comes to China
Potevio.
V. Other relevant information
CPA engaged by the Company
Name of CPA Pan-China Certified Public Accountants (LLP)
17/F, Tower B, Beijing International Building, No. 18, Nandajie Jia, ZOL, Haidian District,
Offices add. for CPA
Beijing
Signing accountant He Jiangxing, Zhang Jinghui
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
Financial adviser engaged by the Company for performing continuous supervision duties in reporting period
√ Applicable □ Not applicable
Office address of the financial
Financial adviser Financial adviser sponsor Continuous supervision period
adviser
North Block, Time Square
Excellence (Phase II), No.8
CITIC Securities Co., Ltd. Zhongxin 3rd Road, Futian Yang Xiao, Yang Zhenrui 2020.12.31-2021.12.31
District, Shenzhen, Guangdong
Province
7
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
VI. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data or not
√Yes □No
Retroactive adjustment or reasons of re-statement
Correction of accounting errors
Changes (+,-)
compared with
2020 2019
the previous
2021
year
Before After After Before After
adjustment adjustment adjustment adjustment adjustment
1,025,243,815. 1,025,243,815. 1,338,284,194. 1,156,771,262.
Operating revenue (RMB) 917,129,674.49 -10.55%
83 83 21 94
Net profit attributable to
-138,766,373.7 -169,088,516.6 -169,088,516.6
shareholders of the listed 21,964,552.84 21,964,552.84 -731.77%
0 9 9
Company (RMB)
Net profit attributable to
shareholders of the listed
-141,603,716.8 -154,393,042.7 -154,393,042.7 -171,904,933.4 -171,904,933.4
Company after deducting 8.28%
2 6 6 1 1
non-recurring gains and losses
(RMB)
Net cash flow arising from
-61,717,528.76 88,145,348.87 88,145,348.87 -170.02% 22,686,114.91 22,686,114.91
operating activities (RMB)
Basic earnings per
-0.65 0.1 0.1 -750.00% -0.79 -0.79
share(RMB/Share)
Diluted earnings per share
-0.65 0.1 0.1 -750.00% -0.79 -0.79
(RMB/Share)
Weighted average ROE -105.00% 12.29% 12.29% -117.29% -66.55% -66.55%
Changes (+,-)
compared with
Year-end of2020 Year-end of2019
Year-end the year-end of
of2021 previous year
Before After After Before After
adjustment adjustment adjustment adjustment adjustment
1,167,608,410. 1,167,608,410. 1,652,005,519. 1,652,005,519.
Total assets (RMB) 993,571,982.44 -14.91%
82 82 44 44
Net assets attributable to
shareholder of listed Company 65,187,412.69 189,624,160.92 189,624,160.92 -65.62% 169,543,106.29 169,543,106.29
(RMB)
8
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Reasons for changes in accounting policy and correction of accounting errors
According to relevant requirement of the Decision on Taking Corrective Regulatory Measures Against Nanjing Putian
Telecommunications Co., Ltd (Administrative Supervisory Measures Decision Letter of Jiangsu Securities Regulatory Bureau [2022]
No.10), and after deliberated and approved by 58th session of 7th BOD held on April 22, 2022, The Company adopted retrospective
restatement method to correct the accounting errors for the periodic reports of 2017, 2018 and 2019. For the impact with annual
operation results and financial status concerned, found more in the Notice on Correction of Prior Period Accounting Errors released
by the Company dated April 26, 2022 and ―15(1).Correction of Prior Period Accounting Errors‖ carried in Section X. of the Annual
Report.
The lower of the Company’s net profit before or after deduction of non-recurring profit (gain)/loss for the last three financial years is
negative, and the audit report for the latest year indicates that there is uncertainty about The Company’s ability to continue as a going
concern
□Yes √No
The lower of the net profit before or after deduction of non-recurring profit (gain)/loss is negative
√Yes □No
Item 2021 2020 Note
Operating revenue (RMB) 917,129,674.49 1,025,243,815.83 -
Deduction amount from
10,884,944.81 10,262,253.21 -
operating revenue (RMB)
Amount after deduction (RMB) 906,244,729.68 1,014,981,562.62 -
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International
Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or
Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VIII. Quarterly main financial index
Unit: RMB/CNY
Q1 Q2 Q3 Q4
9
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Operating revenue 190,510,440.63 261,368,169.80 230,970,269.55 234,280,794.51
Net profit attributable to
-15,982,760.06 -13,611,107.13 -6,957,585.43 -102,214,921.08
shareholders of the listed Company
Net profit attributable to
shareholders of the listed Company
-16,485,198.74 -13,381,259.75 -6,972,945.34 -104,764,312.99
after deducting non-recurring gains
and losses
Net cash flow arising from
-81,930,160.48 -34,792,112.67 11,355,021.94 43,649,722.45
operating activities
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in The Company’s quarterly report and semi-annual report
□Yes √ No
IX. Items and amounts of extraordinary profit (gains)/loss
√ Applicable □ Not applicable
Unit: RMB/CNY
Item 2021 2020 2019 Note
Gains/losses from the disposal of
non-current asset (including the write-off -134,892.35 171,454,257.57 119,033.08
that accrued for impairment of assets)
Governmental subsidy reckoned into current
gains/losses (except for those with normal
operation business concerned, and conform
to the national policies & regulations and are 660,727.46 6,456,622.79 4,265,247.47
continuously enjoyed at a fixed or
quantitative basis according to certain
standards)
Gains/losses from debt restructuring 2,456,389.38
Other non-operating revenue and
expenditure except for the aforementioned 328,880.05 1,135,543.03 -185,497.35
items
Payable unable to paid 362,546.35
Less: impact on income tax 108,335.97 122,246.44 154,871.99
Impact on minority shareholders’
365,425.45 2,566,581.35 1,590,040.84
equity (post-tax)
Total 2,837,343.12 176,357,595.60 2,816,416.72 --
Specific information on other items of profits/losses that qualified the definition of non-recurring profit(gain)/loss
□Applicable √Not applicable
The Company does not have other items of profits/losses that qualified the definition of non-recurring profit(gain)/loss
10
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Information on the definition of non-recurring profit(gain)/loss that listed in theQ&A Announcement No.1 on Information Disclosure
for Companies Offering Their Securities to the Public --- Extraordinary (non-recurring) Profit(gain)/loss as the recurring
profit(gain)/loss
□Applicable √Not applicable
The Company does not have any non-recurring profit(gain)/loss listed under theQ&A Announcement No.1 on Information Disclosure
for Companies Offering Their Securities to the Public --- Extraordinary (non-recurring) Profit(gain)/lossdefined as recurring
profit(gain)/loss
11
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section III. Management Discussion and Analysis
I. Industry of the Company during the reporting period
According to the information released by the Ministry of Industry and Information Technology, in 2021, China’s communication
industry actively promoted the construction of a network powerful nation and Digital China, andfully acceleratedthe construction and
application of new information infrastructure such as 5G and gigabit optical networks, which provided strong supports for creating
new advantages in the digital economy and enhancing economic development. The development quality and growth level of the
industry were further improved, achieving a good start in the ―14th Five-Year Plan‖. The network infrastructure continued to evolve
and upgrade, the investment in fixed assets was basically the same as the previous year, and the investment in 5G accounted for
nearly half; the network infrastructure was optimized and upgraded, and the construction of all-optical networks was further
advanced; 5G network construction was accelerated, and network coverage continued to advance.
The communication equipment manufacturing industry is the upstream industry of the communication industry and an important
foundation of the communication industry. Driven by national policies, the communication equipment manufacturing industry is
generally facing good development opportunities; at the same time, the communication equipment manufacturing industry is a fully
competitive industry with many enterprises and fiercecompetition, and the overall profit level is declining.
From the segmentationof the Company’s main products, in terms of integrated wiring products, with the implementation of cloud
computing and big data, the construction of domestic data centers has been steadily advanced, and the network architecture of the
military, government, and rail transit industries has been transformed and upgraded,as the data center infrastructure, integrated wiring
has been driven by them; in terms of video conferencing products, with the intensification of Sino-US trade frictions, the product
competitiveness of domestic brands in the industry has continued to increase; interms of low-voltage distribution products, the
market has formed a competition pattern with product technology, service ability and sales channel as the core, and the market
competition is fierce. The target market of wiring products mainly includes the private network markets such as operators, tower
companies, and governments, of which the product differentiation is small, and price competition is the main feature of the industrial
competition pattern of this product.
II. Main businesses of the Companyduring the reporting period
As one of the important product and solution providers in the domestic information and communication field, The Company adheres
to the "product + solution + service" strategy, and continuously accelerates product innovation, industrial structure adjustment,
transformation and upgrading. The main business of the Company and its subsidiaries involves optical communication networks,
wireless communication networks, data applications, industrial electric and other fields, including optical distribution networks and
communication supporting overall solutions (ODN overall solutions, optical network intelligent solutions, energy-saving data centre
solutions), multimedia communication and application solutions, building intelligent integrated solutions, industrial intelligent power
distribution systems, solar street light control systems, etc. Customers include domestic telecom operators, China Tower and industry
customers in government,finance, power, medical and other fields.
The Company’s optical distribution network and communication supporting overall solutions can be used for domestic
communication network construction, broadcasting and television network transformation, high-speed rail communication
construction, urban metro construction, e-commerce industry, etc.; and the data center products are widely used in data center
12
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
construction projects of operators, internet and other enterprises; the subsidiary Nanjing Southern Telecom Co., Ltd. can provide
multimedia communication and application solutions for the large and medium-sized industry customers in the fields of government,
finance, medical care, and education, and so on; the subsidiary Nanjing Putian Telege Intelligent Building Ltd. mainly provides
customers with mid-to-high-end integrated wiring and building intelligent system solutions; subsidiary Nanjing Nanman Electric Co.,
Ltd. is oriented towards rail transit, airports, ports and other industrial sites and provides industrial intelligent power distribution
products; the subsidiary Nanjing Putian Datang Information Electronic Co., Ltd. mainly provides customers with solar street lamp
controllers and Internet of Things street lamp monitoring systems, etc.
The Company mainly obtains business opportunities by participating in project bidding, designs plans, produces or purchases
equipment required by customers according to project requirements, and is responsible for installation and debugging, and realizes
profits after deducting costs in accordance with the contract price. The Company's operating results are mainly affected by factors
such as capital expenditures by telecom operators and industry customers, information input and bidding results, fluctuations in raw
material prices and other cost changes.
During the reporting period, The Company granted 14 new patents (including 4 patents for inventions and 10 utility models) , and
participated in the formulation of multiple industry standards such as Standards of the PoE System Engineering Technical for
Ethernet; Southern Telecom obtained the Information Technology Service Management System Certification and the participation of
building the ―isolation area remote visiting system‖ of Second Hospital of Shandong University won the 5G+Smart Medical
Innovation Application Awards; Telege Company obtained the certification of first batch ―Power Over Ethernet (PoE) Products‖ in
China.
III. Core Competitiveness Analysis
1. Marketing ability
The Company has mature market networks, servesthe operators and industry customers in the government, rail transit, finance,
medical, power, internet companies and others over a long period of time, and has rich industry experience.
2. Product competitiveness
The Company insists on being market-oriented, strengthening and optimizing its leading products, actively developing new products,
and constantly improving its innovation capabilities.
The Company has high technology and product advantages in wiring products. It has developed a series of optical network
connection products that have obtained a number of national invention patents, and is a supplier of strong brand influence in the field
of domestic optical fiber communication network connection products. Prefabricated steel structure data center products can quickly
build data center modules for use in the construction of data center computer rooms, and perform on-site integration of various
equipment in the production area to achieve integrated delivery. Access products have good performance in wired access networks,
optical transmission networks, wireless access networks, etc., and are ranked among the "Top Ten Most Competitive Enterprises in
China's Optical Transmission and Network Access Equipment" throughout the year. Focusing on video communication applications
for more than 20 years, the subsidiarySouthern Telecom has accumulated rich market channels and client resources, as well as
differentiated products and conceptual design capabilities, the self-developed products have been recognized by large industry clients.
The complete set of electrical products of the subsidiary, Nanman Company, are widely used in airports, wharves, rail transit and
other industries, and has accumulated rich customer resources and industry experience, and can provide customers with complete sets
of products and solutions for individual needs. Telege Building is positioned in the high-end market for cabling system, and its
products serve the Beijing Winter Olympics, domestically produced large aircraft and other key projects, and it is actively developing
new products such as a new generation of intelligent cabling systems and integrated cabling management platforms.
13
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
3. Brand influence
The Company is an information and communication enterprise under the central state-owned enterprise, and communication products
have a strong brand influence in the field of domestic optical fiber communication network connection products. The integrated
cabling products of Telege Building are well-known brand products in Jiangsu Province, a famous trademark of the province, and
have been ranked among the top ten domestic cabling system brands for more than ten consecutive years. The video conferencing
product series of Southern Telecom have a high reputation in China.
IV. Main business analysis
1.Overview
During the reporting period, The Company adhered to the general principle of seeking progress while maintaining stability, closely
focused on The Company’s annual business tasks, and continued to carry out industrial adjustment, deepen reform and innovation,
reduce redundant staff, and promote cost reduction and efficiency improvement under the enormous pressure from external shocks
such as the COVID-19 pandemic and rising raw material prices, as well as The Company’s cash flow and production cost.During the
reporting period, The Companyachieved an operating income of 917.13 million yuan, and net profit attributable to shareholders of
the listed company was -138.77 million yuan. The operating income decreased by 10.55% compared with the previous year, mainly
due to the intensifying market competition, repeated pandemics, industrial restructuring and other factors. The Company strived to
promote product transformation, reduce gross profit business, and improve sales order quality, thus the overall gross profit margin
increased, and the comprehensive gross profit margin increased by 3.83% on a year-on-year basis. The Company continued to
strengthen the control of general expenses, and expenses decreased by 28.65 million yuan compared with the previous year, however,
while the price of raw materials rose and the sales volume declined, The Company still needed to bear fixed costs and expenses, at
the same time, The Company made a provision for asset impairment of 107.32 million yuan in accordance with the accounting
standards this year, so the current net profit was negative.
Development situation of main business during the reporting period:
Base on the strategic positioning of the―National Team of Internet Information Business‖ of CETC’s civil products, The Company
returned to the original intention of the industry, focused on key market development, continuously increased new product research
and development, tapped product production potential, innovated cost control methods, adhered to the industry, focused on the main
business, and strived to make solid, professional and refined industry .
In terms of traditional products, we focused on key industries, and continued to explore the transformation of traditional wiring
industry to data center business while stabilizing the existing industry position. In 2021, the wiring products won the bids for the
centralized procurement of Zhongnanhai Special Communication Bureau, and won the bids for Nanchang Metro Line 4, Nanjing
Metro Line 5 and other system integration projects; successfully signed thecontracts for Jiangsu Unicom future city project, China
Telecom Wuxi Branch custom cabinet supporting project, etc.. Completed the optical cable intelligent transformation projects of
Beijing Metro Line 1 and Batong Line. The Company actively participated in the construction of data centers and other projects, and
successfully supplied projects such as Suzhou Telecom Taihu data center channel, Jiangsu Mobile Jiangbei data center, Wuxi
Telecom Dafu data center micromodule, Huawei Changzhou Telecom micromodule, Suzhou Baidu cabinet. Completed the
implementation of Tencent Huailai Dongyuanphase III T-block project, the maintenance of Dongtai big data room project, and the
completion acceptance of Nanjing Telecom Jishan data center project. The basic processing department took advantage ofthe
information platform to improve and continuously improved the manufacturing level; strived to improve the efficiency of production
operationsby continuously strengthening the on-site cost management.
14
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Southern Telecom successfully signed contracts for the renewal of insurance of the Postal Savings Bank of China and the upgrade
and expansion of the cloud videoconferencing platform of China Everbright Bank. In addition, The Company utilized its
accumulated resources in the videoconferencing industry to gradually integrate into the Huawei ecosystem, and Huaweibusiness
successfully won the bids for Minmetals, CCCC, PCOC and other large-scale projects. New businesses such as multimedia
integration and independent research and development continued to grow.
Telege Company became the first batch of manufacturers to obtain POE certification in China, and completed the supply of
integrated wiring products for many projects such as the weak current system engineering project of the Yanqing Winter Olympics
Village project, the Beijing Financial Court project, and the west district supporting project of Shanghai Hongqiao International
Airport. The Company actively dug deep into customers in medical, education and other industries, and supplied for the troops
stationed in Hong Kong and Macao, the National Defense University project, China Construction Bank Liaoning Branch and other
projects.
Nanman Company continued to deepen its development in the rail transitfield, and signed Beijing Metro Line 19, Hangzhou Metro
Line 9, Hefei Metro Airport Line, Shenzhen Urban Rail Transit Line 6 Branch Line and other projects, and maintained its leading
position in the industry. In terms of social projects, The Company signed Xiongan Pipe Gallery, Shenneng Environmental Protection
and other projects.
Datang Company quickly responded to market changes, launched new products such as integrated lamp panels and cruise terminal
positioning management systems, and formed a certain sales.
At the same time, The Company insisted on independent research and development and increased technological innovation. Telege
Company seized the opportunity of localization of high-end wiring, and completed the research and development of new six types of
distribution frames, new modular distribution frames and automated production lines, B1/B2-class high flame retardant cables, and
the data acquisition of a new generation of electronic distribution frame systemlocalizationsmart jumpers and domestic solutions;
Nanman Company completed the research and development of the second-generation socket box and successfully put it on the
market; Southern Telecom completed the full-featured Ruijing 13.3-inch conference guide all-in-one machine, and completed the
schematic diagram of the core board and PCB designwork etc.. Datang Company completed the lamp board development of the new
CPU platform and successfully launched it into the market.
In terms of operation and management, while doing a good job in the pandemic prevention and control, The Company continued to
focus on the four key tasks of ―saving expenditure, opening source, innovation, and assessment‖, deepened internal reform and
adjustment, improved operation quality, strengthened internal control, solidly promoted the governance of loss-making enterprises,
continued to promote the cost reduction, continuously consolidatedThe Company’s operating foundation, and enhanced
competitiveness.
2.Revenue and cost
(1)Composition of operating revenue
Unit: RMB/CNY
2021 2020 Y-o-y changes (+,-)
15
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Ratio in operating Ratio in operating
Amount Amount
revenue revenue
Total operating
917,129,674.49 100% 1,025,243,815.83 100% -10.55%
revenue
Industries
Communication
814,698,901.29 88.83% 926,487,735.23 90.37% -12.07%
industry
Electrical industry 102,430,773.20 11.17% 98,756,080.60 9.63% 3.72%
Products
Main business
revenue-Video
293,267,591.71 31.98% 314,877,571.26 30.71% -6.86%
conferencing
products
Main business
revenue-Integrated 381,243,880.13 41.57% 357,130,844.30 34.83% 6.75%
cabling products
Main business
revenue-Low-voltag
100,939,986.75 11.01% 96,477,794.59 9.41% 4.63%
e distribution
products
Main business
revenue-Wiring 153,488,446.15 16.74% 287,776,479.36 28.07% -46.66%
products and others
Interior offset -32,454,210.31 -3.54% -55,183,049.81 -5.38% 41.19%
Other business
20,643,980.06 2.25% 24,164,176.13 2.36% -14.57%
revenue
Regions
Domestic area 917,129,674.49 100.00% 1,025,243,815.83 100.00% -10.55%
Sales model
Direct sales 450,874,262.30 49.16% 514,895,185.71 50.22% -12.43%
Distribution 466,255,412.19 50.84% 510,348,630.12 49.78% -8.64%
(2) The industries, products,regions or sales model accounting for over 10% of the Company’s operating
revenue or operation profit
√Applicable □ Not applicable
Unit: RMB/CNY
Operating Increase/decrease Increase/decrease Increase/decrease
Operating cost Gross profit ratio
revenue of operating of operating cost of gross profit
16
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
revenue y-o-y y-o-y ratio y-o-y
Industries
Communication
814,698,901.29 645,422,053.11 20.78% -12.07% -16.59% 4.30%
industry
Electrical
102,430,773.20 77,075,597.57 24.75% 3.72% 5.41% -1.21%
industry
Products
Main business
revenue-Video
293,267,591.71 227,789,514.03 22.33% -6.86% -12.66% 5.16%
conferencing
products
Main business
revenue-Integrate
381,243,880.13 291,804,222.05 23.46% 6.75% 5.22% 1.11%
d cabling
products
Main business
revenue-Low-volt
100,939,986.75 76,275,464.34 24.43% 4.63% 6.82% -1.56%
age distribution
products
Main business
revenue-Wiring
153,488,446.15 141,952,065.67 7.52% -46.66% -47.17% 0.89%
products and
others
Interior offset -32,454,210.31 -32,454,210.31 0.00% 41.19% 40.05% -1.89%
Other business
20,643,980.06 17,130,594.90 17.02% -14.57% -24.91% 11.42%
revenue
Regions
Domestic area 917,129,674.49 722,497,650.68 21.22% -10.55% -14.69% 3.83%
Sales model
Direct sales 450,874,262.30 363,456,227.66 19.39% -12.43% -16.81% 4.24%
Distribution 466,255,412.19 359,041,423.02 22.99% -8.64% -12.43% 3.34%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main business based on
latest one year’s scope of period-end
□ Applicable √ Not applicable
(3) Whether The Company’s revenue from physical sales is greater than its revenue from labor services
√ Yes □ No
Industries Item Unit 2021 2020 Increase/decrease
17
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
y-o-y (+,-)
Sales volume RMB 814,698,901.29 926,487,735.23 -12.07%
Communication
Production volume RMB 793,048,409.88 911,308,352.71 -12.98%
industry
Inventory RMB 129,110,304.76 150,760,796.17 -14.36%
Sales volume RMB 102,430,773.2 98,756,080.6 3.72%
Electrical industry Production volume RMB 110,970,857.99 104,180,149.27 6.52%
Inventory RMB 57,421,260.94 48,881,176.15 17.47%
Note: due to the variety of products, the measurement unit is difficult to unify, the sales volume, production volume and inventory are
expressed by the amount.
Reasons for y-o-y relevant data with over 30% changes
□ Applicable √ Not applicable
(4) Performance of significant sales contracts, major procurement contract entered into by the Company
up to the current reporting period
□ Applicable √ Not applicable
(5) Constitute of operation cost
Industry classification
Unit: RMB/CNY
2021 2020
Increase/decrease
Industries Item Ratio in operation Ratio in operation
Amount Amount y-o-y (+,-)
cost cost
Main business
cost-Cost of raw
Communication
material 581,208,359.85 80.44% 694,748,624.13 82.03% -16.34%
industry
(procurement
cost)
Communication Main business
47,883,231.59 6.63% 57,941,348.33 6.84% -17.36%
industry cost- Other
Communication Other business
16,330,461.67 2.26% 21,097,941.35 2.49% -22.60%
industry cost
Main business
cost-Cost of raw
Electrical
material 65,532,247.28 9.07% 63,426,773.23 7.49% 3.32%
industry
(procurement
cost)
Electrical Main business 10,743,217.06 1.49% 7,977,089.73 0.94% 34.68%
18
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
industry cost- Other
Electrical Other business
800,133.23 0.11% 1,714,165.72 0.20% -53.32%
industry cost
Total Operation cost 722,497,650.68 100.00% 846,905,942.49 100.00% -14.69%
Explanation
-
(6) Whether the changes in the scope of consolidation in Reporting Period
√Yes □No
(7)Major changes or adjustment in business, product or service of the Company in Reporting Period
□ Applicable √ Not applicable
(8) Major sales and main suppliers
Major sales client of the Company
Total top five clients in sales (RMB) 98,123,338.53
Proportion in total annual sales volume for top five clients 10.70%
Sales of related parties in annual sales from top five
0.00%
clients
Information of top five clients of the Company
Serial Name Sales (RMB) Proportion in total annual sales
Shanghai Zhouluo Information Technology
1 24,092,637.29 2.63%
Co., Ltd.
2 China Telecom 23,766,709.80 2.59%
Shanghai Shengxia Intelligent Technology
3 22,805,441.71 2.49%
Co., Ltd.
Beijing Fuyuantong Digital Technical
4 15,309,592.32 1.67%
Development Co., Ltd.
Beijing RT Zhiyuan Science and Technology
5 12,148,957.41 1.32%
LLC
Total -- 98,123,338.53 10.70%
Other information on main clients
□ Applicable √ Not applicable
19
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 264,007,480.05
Proportion in total annual purchase amount for top five
33.48%
suppliers
Purchase of related parties in annual amount from top five
0.00%
suppliers
Information of top five suppliers of the Company
Serial Supplier Purchase amount(RMB) Proportion in total annual procurement
Jiangsu Kexin Optoelectronics Technology
1 62,146,490.68 7.88%
Co., Ltd.
2 Hongan Group Co., Ltd. 57,233,277.70 7.26%
Jiangsu Shuntian Internatinal Group
3 54,828,236.76 6.95%
Machinery Import & Export Co., Ltd.
4 Huawei Technologies 46,806,026.42 5.94%
POLYCOM Communication Technology
5 42,993,448.49 5.45%
(Beijing) Co., Ltd.
Total -- 264,007,480.05 33.48%
Other information on main suppliers of the Company
□ Applicable √ Not applicable
3. Expenses
Unit: RMB/CNY
Increase/decrease
2021 2020 Note of major changes
y-o-y (+,-)
Sales expense 91,425,098.10 101,208,835.79 -9.67%
Management expense 67,220,016.02 75,477,706.26 -10.94%
Mainly due to the decrease in debt
Financial expense 7,313,928.56 27,074,088.99 -72.99% financing in the period and the interest
expenses declined from a year earlier.
R&D expenses 55,472,535.49 46,319,505.38 19.76%
4. Investment in R&D
√ Applicable □ Not applicable
Expected impact on the future
Projects Purpose Progress Goals to be achieved
development of the Company
20
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
R& D of the new
Enrich the products categories
generation wiring Developing new products Push out new products with
Phase objects of the enterprises and
frame and and updating the product technical content and enhance
completed improving the technical
automatic lines the enterprise competitiveness
parameters for products
production line
Enrich the products categories Push out new products with
B1, B2 grade high Developing new products
of the enterprises and more technical content and
flame retardant and updating the product R&D completed
improving the technical enhance the enterprise
cable lines
parameters for products competitiveness
New generation Enrich the products categories Push out new products with
Developing new products
hybrid networking Phase objects of the enterprises and more technical content and
and updating the product
system for building completed improving the technical enhance the enterprise
lines
intelligence parameters for products competitiveness
Enrich the products categories Push out new products with
Fine pitch LED Developing new products
of the enterprises and more technical content and
display channel and updating the product R&D completed
improving the technical enhance the enterprise
product line lines
parameters for products competitiveness
Enrich the products categories Push out new products with
Developing new products Completed the
Second generation of the enterprises and more technical content and
and updating the product development and
socket boxes improving the technical enhance the enterprise
lines placing on the market
parameters for products competitiveness
R&D personnel
2021 2020 Change ratio (+,-)
Number of R&D personnel
286 332 -13.86%
(people)
Ratio of R&D personnel 27.63% 28.97% -1.34%
Educational background —— —— ——
Undergraduate 176 206 -14.56%
Master 4 5 -20.00%
Junior college 99 111 -10.81%
Secondary specialized school 7 10 -30.00%
Age composition —— —— ——
Under 30 76 83 -8.43%
30~40 138 167 -17.37%
40~50 51 55 -7.27%
Over 50 21 27 -22.22%
Investment of R&D
21
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2021 2020 Change ratio (+,-)
R&D investment (RMB) 55,472,535.49 46,319,505.38 19.76%
R&D investment/Operation
6.05% 4.52% 1.53%
revenue
Capitalization of R&D
0.00 0.00 0.00%
investment (RMB)
Capitalization of R&D
0.00% 0.00% 0.00%
investment/R&D investment
Reasons and effects of significant changes in composition of the R&D personnel
□Applicable √Not applicable
The reason of great changes in the proportion of total R&D investment accounted for operation income than last year
□ Applicable √ Not applicable
Reason for the great change in R&D investment capitalization rate and rational description
□ Applicable √ Not applicable
5. Cash flow
Unit: RMB/CNY
Item 2021 2020 Y-o-y changes (+,-)
Subtotal of cash in-flow from
1,039,198,794.59 1,207,247,116.07 -13.92%
operation activity
Subtotal of cash out-flow from
1,100,916,323.35 1,119,101,767.20 -1.63%
operation activity
Net cash flow arising from
-61,717,528.76 88,145,348.87 -170.02%
operating activities
Subtotal of cash in-flow from
490,953.92 360,865,263.81 -99.86%
investment activity
Subtotal of cash out-flow from
29,998,643.89 15,963,551.12 87.92%
investment activity
Net cash flow from investment
-29,507,689.97 344,901,712.69 -108.56%
activity
Subtotal of cash in-flow from
239,500,000.00 188,998,007.80 26.72%
financing activity
Subtotal of cash out-flow from
137,908,918.21 660,669,001.36 -79.13%
financing activity
Net cash flow from financing
101,591,081.79 -471,670,993.56 121.54%
activity
Net increased amount of cash
10,396,323.99 -38,721,119.73 126.85%
and cash equivalent
22
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Main reasons for y-o-y major changes in aspect of relevant data
√ Applicable □ Not applicable
Net cash flow arising from operating activities has declined on a y-o-y basis, mainly due to the decrease in sales return during the
reporting period.
Cash in-flow from investment activityhas declined on a y-o-y basis, mainly due to disposal of fixed assets and equity transfer in
previous year, which resulted in a large cash in-flow.
Cash out-flow from investment activityhas increased on a y-o-y basis, mainly due to the increase in cash paid for investment.
Net cash flow from investment activityhas declined on a y-o-y basis, mainly due to disposal of fixed assets and equity transfer in
previous year, which resulted in a large cash in-flow from investment activities.
Cash out-flow from financing activityhas declined on a y-o-y basis, mainly due to the decrease in loans returned during the reporting
period.
Net cash flow from financing activityhas increased on a y-o-y basis, mainly due to the decrease in loans returned during the reporting
period.
Net increased amount of cash and cash equivalenthas increased on a y-o-y basis, mainly due to the increase in net cash flow arising
from financing activities during the reporting period.
Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
□ Applicable √ Not applicable
III. Analysis of the non-main business
√ Applicable □ Not applicable
Unit: RMB/CNY
Amount Ratio in total profit Cause of formation Whether be sustainable (N/Y)
Assets impairment
-61,026,996.13 45.44% Loss on inventory valuation N
loss
Credit impairment
-46,296,202.37 34.47% Bad debt losses N
loss
VI. Analysis of assets and liability
1. Major changes of assets composition
Unit: RMB/CNY
Year-end of2021 Year-begin of 2021 Ratio
Ratio in total Ratio in total changes Notes of major changes
Amount Amount
assets assets (+,-)
188,665,530.3
Monetary fund 18.99% 209,849,710.96 17.97% 1.02%
7
Account 334,586,551.9 33.68% 493,992,403.49 42.31% -8.63%
23
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
receivable 3
Contract assets 0.00% 0.00% 0.00%
186,531,565.7
Inventory 18.77% 199,641,972.32 17.10% 1.67%
0
Investment real
6,854,891.51 0.69% 4,267,013.35 0.37% 0.32%
estate
Long-term equity
10,422,193.15 1.05% 10,422,056.96 0.89% 0.16%
investment
117,801,156.7
Fix assets 11.86% 100,158,063.58 8.58% 3.28%
1
Construction in
292,996.23 0.03% 22,454,792.27 1.92% -1.89%
process
Right-of-use
0.00% 0.00% 0.00%
assets
Short-term loans at end of the period
199,000,000.0
Short-term loans 20.03% 65,000,000.00 5.57% 14.46% increased compared with that of
0
beginning of the period
Contract liability 18,884,024.60 1.90% 28,518,252.40 2.44% -0.54%
Long-term loans 0.00% 0.00% 0.00%
Leasing liability 0.00% 0.00% 0.00%
Foreign assets account for a relatively high proportion
□Applicable √Not applicable
2. Assets and liability measured by fair value
√ Applicable □ Not applicable
Unit: RMB/CNY
Accumulated
Gains/losses
fair value Impairment Amount Sales amount
Opening of fair value Other Ending
Item changes accrued in purchased in in current
number changes in the changes number
included in current period current period period
period
equity
Financial
assets
1.Trading
financial
asset(excludin 20,000,000.0 20,000,000.
g derivative 0 00
financial
assets)
24
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
4.Other equity
instrument 741,953.00 741,953.00
investment
Subtotal
20,000,000.0 20,741,953.
financial 741,953.00
0 00
assets
Receivable 40,852,223.
32,594,702.60
financing 88
20,000,000.0 61,594,176.
Total above 33,336,655.60
0 88
Financial
0.00 0.00
liability
Other changes
Whether there are significant changes in the measurement attributes of the major assets during the reporting period
□Yes √No
3. The assets rights restricted till end of the period
Assets with ownership or usage rights restricted:
(1)detail information
Book value at period-end (Unit:
Item Restriction reason
RMB/CNY)
Monetary funds 8,205,628.07 Guarantee deposit
Monetary funds 831.44 Bank freeze involving litigation
Fixed assets 1,063,884.17 Financial leasing
Total 9,270,343.68
(2)other explanation
Saved as disclosed above, The Company pledged its stock rights of 4.8 million Yuan (40% equity in total) in the subsidiary Nanjing
Putian Telege Intelligent Building Ltd., stock rights of33.17 million Yuan (96.99% equity in total) in the subsidiary Nanjing
Southern Telecom Co., Ltd., stock rights of5.07 million Yuan (50.7% equity in total)in the subsidiary Nanjing Putian Changle
Telecommunication Equipment Co., Ltd., and stock rights of 7.8 million Yuan (78% equity in total) in Nanjing Putian Network Co.,
Ltd pledge to the parent Company for entrusting the loan from Bank,and handled The Company's equity registration respectively at
Market Supervision Administration in Jiangning District, Hi-Tech Industry District, Yuhuatai District and Qinghuai District of
Nanjing City. Transfer of the stock rights of the aforesaid subsidiaries arerestricted before the pledge being lifted.
VII. Investment analysis
1. Overall situation
√ Applicable □ Not applicable
25
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Investment in the same period of last year
Investment in the reporting (RMB) Changes
( RMB)
29,661,590.83 15,508,722.61 91.26%
2. The major equity investment obtained during the reporting period
□ Applicable √ Not applicable
3. The major non-equity investment in progress during the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
□ Applicable √ Not applicable
The Company had no securities investment during the reporting period.
(2) Derivative investment
□ Applicable √ Not applicable
The Company had no derivatives investment during the reporting period.
5. Application of raised proceeds
□ Applicable √ Not applicable
The Company had no application of raised proceeds during the reporting period.
VIII. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company had no major assets were sold during the reporting period.
2. Sales of major equity
□ Applicable √ Not applicable
IX. Analysis of main shareholding Company and joint stock companies
√ Applicable □ Not applicable
Main subsidiaries and joint stock companies with an impact of 10% or more on The Company’s net profit
Unit: RMB/CNY
26
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Company Main Register Operating Operating
Type Total assets Net assets Net profit
name business capital revenue profit
Multimedia
Nanjing
communicati
Southern 34.2 million 353,161,616. 96,010,589.0 293,669,517.
Subsidiary on and 9,532,540.11 8,555,394.52
Telecom Co., yuan 97 1 19
application
Ltd
solutions
General
cabling,
Nanjing development,
Putian Telege production 20 million 247,261,976. 97,200,964.3 385,394,574. 32,440,563.3 28,503,440.2
Subsidiary
Intelligent and sales of yuan 46 2 50 1 4
Building Ltd the building
intelligent
products
R&D,
manufacture
and sales of
Nanjing the software
Putian of 10 million 17,211,505.0 16,114,985.7 -7,018,823.7 -7,025,762.2
Subsidiary 672,409.76
Network Co., communicati yuan 1 6 4 7
Ltd. on, network
and
electronic
equipment
Out-door
patch,
sub-line
equipment,
Nanjing
network
Putian
box(cube)of
Changle
out-door and 10 million 29,462,685.3 17,813,747.8 -22,705,617. -22,705,617.
Telecommuni Subsidiary 9,256,880.01
machinery yuan 0 7 10 10
cations
office,
Equipment
manufacture
Co., Ltd.
and sales of
communicati
on electrical
products
Putian Export and
Telecommuni import of HKD 2 -18,312,002.
Subsidiary 324,090.80 0.00 -165,930.01 -165,930.01
cations telecommuni million 66
(H.K.) Co., cation
27
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Ltd. equipment,
Hi-tech R &
D and
transfer,
technology
trade
R & D and
sales of the
Nanjing electronic
Putian components
Telecommuni assembly, 5 million -3,803,100.2 -1,326,151.6 -1,326,151.6
Subsidiary 1,185,486.13 0.00
cation electronic yuan 7 7 7
Technology products and
Co., Ltd. telecommuni
cation
equipment
Manufacture
Nanjing and sales of
Nanman industrial 41.14 million 196,763,512. 52,388,602.5 102,430,773.
Subsidiary 970,170.81 538,866.82
Electric Co., intelligent yuan 42 0 20
Ltd. distribution
products
R&D,
manufacture
and sales of
Nanjing
solar
Putian
controller,
Datang 10 million 45,854,596.5 24,014,959.4 20,187,867.9 -5,805,057.8 -5,780,312.6
Subsidiary and
Information yuan 0 6 7 4 2
production &
Electronic
processing
Co., Ltd
business of
electronic
products
Information
system
integration
Chongqing
service,
Puhua
computer 50 million
Information Subsidiary 2,408,159.31 2,030,937.31 8,161,928.63 8,851.44 22,397.77
software and yuan
Technology
hardware and
Co., Ltd.
peripherals
manufacturin
g,
28
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
manufacture
of the cloud
computing
devices,
telecommuni
cation
equipment
and internet
devices, big
data services
and software
development
Particular about subsidiaries acquired or disposed during the reporting period
√ Applicable □ Not applicable
Method of acquisition and disposal during Impact on overall production operations
Name
the reporting period and results
Purchasing 25% equity of minority
Nanjing Nanman Electric Co., Ltd. shareholders, and shareholding ratio No significant impact
increased to 100% from 75%
Proposal with subsidiary liquidation and
Putian Telecommunications (H.K.) Co.,
close concerned has deliberated and No significant impact
Ltd.
approved by the Board
Explanation on main joint stock companies
X. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
XI. Future Development Prospects
The year 2022 is the year when the 20th National Congress of the Communist Party of China will be held, the year when the 14th
Five-Year Plan will be fully implemented and new development pattern will be arranged in an all-round way. Under the guidance of
long-term strategic planning for a ―dual circulation‖ development pattern, carbon peak and carbon neutralization goals, and common
prosperity, China is expected to start a round of comprehensive optimization for the demand structure and promote sustainable and
high-quality and stable economic growth. From an industry perspective, the industrial layout of the national ―Dong Shu Xi Suan‖
project has created new opportunities for the communication equipment manufacturing industry and brought a lasting and large-scale
market demand. At the same time, in the post-pandemic period, the market demand for online videoconferencing and remote
multimedia collaboration services remains strong, and The Company’s multimedia communication business still has continuous
market opportunities. According to the national ―carbon peak and carbon neutralization‖ strategy, China will increase investments in
the power industry, and the rail transit and weak current intelligent industries covered by new infrastructure strategy, and the
information technology application innovation industry will also usher in a period of development.
29
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
In the face of new opportunities and new challenges, The Company will be based on the national needs, the industrytrends, and its
own capabilities, focus on the main responsibility and main business, identify its own positioning, clarify the direction of industrial
development, strengthen the development of new products, improve the system and mechanism, and actively integrate into the CETC
system, promote The Company to complete optimization and adjustment as soon as possible, and achieve stable and healthy
development of the Company.
Key work initiative in the new year:
1. Focus on key industry customers, pay close attention to key tasks. Advocate the ―big market‖ concept and share internal resources.
Based on the market of the Company’s existing competitive products such as integrated wiring, videoconferencing and industrial
electrical, deeply cultivate customers in rail transit, data center, finance, medical treatment and other industries, driven by system
solutions of ―product + technology + service‖, actively plan to develop new markets, internally coordinate market resources, dig deep
into customer needs, increase the stickiness with customers, and enhance The Company’s overall industry market competitiveness.
In terms oftraditional wiring products, we will pay close attention to the industry market, integrate resources, and explore new sales
methods. In terms of data center products,we will focus on customer projects of operators in advantageous regions. For production
and processing businesses, we will strengthen the control of production process, continuously improve capacity, and strive to reduce
cost and increase efficiency. Southern Telecom will take the Huawei videoconferencing business as an entry point, while maintaining
the original product positioning, expand functions such as IoT centralized control and videoconferencing network quality diagnosis,
extend to intelligence management of office space, making it the core of differentiated competitiveness of Nandian solutions. Telege
Company will improve sales system, regulate the market through innovative sales means and scientific managementmethods,
strengthen the development of industry customers, and promote The Company’s products. Nanman Company will continue to run
through therail transit field, comprehensively develop products from the socket box, distribution box to the switch cabinetfield, at
same time, focus on the development of airports, ports, petrochemical industry, data center, pipe gallery, hospitals, etc.. Datang
Company will reconstitute the sales system, refine product sales goals, and focus on three new product markets, i.e. smart power
supply, cruise system, and charger.
2. Strengthen the coordination of upstream and downstream industry chains to achieve win-win cooperation
Firmly seize the opportunity of China Potevio and CETC to achieve major strategic restructuring, strengthen business collaboration
with related units, and strive to integrate The Company’s products into the overall solution of cooperators, form multiple business
growth points, promote the transformation of Nanjing Potevio from a single product supplier to an overall solution supplier and
service provider,and achieve upstream and downstream complementarity in the industrial chain and win-win cooperation.
3. Strengthen new product research and development capabilities and enhance internal driving force for development
Further strengthen the scientific nature of the Company’s new product project approval, improve the success rate of new product
development, reduce the risk and cost of new product development, and strive to develop new products.
In terms of operation and management, The Company will strengthen the strategic guidance, identify the development orientation,
continuously optimize the operation structure, and improve the quality of operation; promote the asset disposal to reduce operation
risks; optimize performance assessment, build talent echelon; keep abreast with advanced enterprises, improve basic management;
accelerate transformation and upgrading, and promote high-quality development of the Company by deepening enterprise reform.
Risks The Company run in development:
1. Cycle risk of communication industry
30
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
The Company is mainly engaged in the manufacture and sales of communications products, customers include several major telecom
operators in China. The establishment and adjustment of network construction period and investment plan of the operators have a
significant impact on the operation of the Company and pose industry cycle risk.
Countermeasures: The Company will continue to further integrate quality resources, accelerate industry upgrade, expand industry
market and improve industry profitability.
2.Technology R&D risk
The telecommunication industry is experiencing rapid change of technology development and product upgrade. Therefore, The
Company’s business operation will be adversely affected if it cannot adapt to market change, lag behind in the technology reform or
the developed products do not satisfy market demands.
Countermeasures: The Company will actively follow up the latest development trend of industrial technology, develop and introduce
technology based on market requirements, focus on organization, planning and management of product development and expand
development of new products, aiming to maintaining the leading position in terms of technology.
3.Market competition risk
The industry in which The Company operates is highly competitive with substantial market players. Besides, customers, such as
various operators, continue to adopt centralized procurement policy which led to very furious market competition. Benefiting from
long-term operation, The Company has accumulated certain competitive advantages in terms of brand, technology, quality and
marketing. If our products fail to cater for the market variation in future, we may lose the existing advantages in market competition.
Countermeasures:The Company will continue to capitalize on the existing advantages to consolidate traditional market while
expanding special network and industry markets actively, and accelerate the transformation and upgrading of industries and foster
strategic emerging industries. Through continuous cost control and scientific innovation, it continues to improve production and
research capability, which leads to rapid development of the new products and enables The Company to maintain and improve
profitability.
4. Cash flow shortage risk
Products of the Company are used in operator network construction, subway construction and other projects. Affected by project
completion cycle and long approval process, collection cycle is long. The receivable cycle was extended and inventory liquidation
cycle becomes slower due to the impact of COVID-19, pressure from cash flow further increased.
Countermeasures: persist in the budget management on funds, proportion of fund payment and collection to ensure the dynamic
balance of cash flow; intensified cleanup efforts on housing provident fund and enterprise annuity, increasing assessment efforts,
urging the timely collection of payment for goods, reinforcing the inventory management and improving the liquidity; getting certain
working capital financing from the banking and financial institutions as required.
XII. Reception of research, communication, interview and other activities during the
reporting period
□ Applicable √ Not applicable
No reception of research, communication and interview occurred during the reporting period
31
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section IV Corporate Governance
I. Corporate governance of the Company
The Company has continuously improved the corporate governance structure in strict accordance with the requirements of the
Company Law, Securities Law, Guidelines for the Governance of Listed Companies, Stock Listing Rules of the Shenzhen Stock
Exchange, and other relevant laws and regulations, formed scientific and effective division of responsibilities and balance mechanism,
improve the Company’s internal control system, strengthen internal and external supervision, and improve the level of standardized
operation. During the reporting period, the Company adhered to the combination of party organization construction andlegal-person
governance, operated according to law, effectively safeguard the legitimate rights and interests of small and medium shareholders,
and promoted the Company’s sustainable and healthy development.
1. Shareholders and shareholders’ meeting
The Company formulated the articles of association in accordance with The Company Law, Guidelines for Articles of Association of
Listed Companies, and other laws and regulations, ensured that all shareholders have equal rights according to their share and bear
the corresponding obligations. The shareholders’ meetings were convened, held and voted according to the laws and regulations,
guaranteed that all shareholders have the right to know and make decisions on major issues, the decision-making procedures of
related transactions strictly abided by the laws and regulations and the provisions of theArticles of Association, did not damage
theinterests of the Company and non-related shareholders.
2. Directors and the board of directors(BOD)
The Company elected directors in strict accordance with the election procedures prescribed by laws and regulations and the Articles
of Association. There were 9 members of the Company’s board of directors, including 3 independent directors, and the number and
personnelcomposition of the board of directors met the requirements of laws and regulations. The board of directors, independent
directors, and specialized committees of the board of directors exercised powers in accordance with the laws and regulations and the
provisions of the Articles of Association, and safeguarded the legitimate rights and interests of the Companyand all shareholders.
3. Supervisors and the board of supervisors(BOS)
The Company elected supervisors in strict accordance with the election procedures prescribed by laws and regulations and the
Articles of Association. There were 3 members of the Company’s board of supervisors, including 1 employee supervisor, and the
number and personnelcomposition of the board of supervisors met the requirements of laws and regulations. The board of supervisors
performed their duties independently, inspectedthe Company’s financial affairs according to law, supervised the legality and
compliance of directors, senior management personnel in performing their duties, and exercised the functions and powersstipulated in
the articles of association, and safeguarded the legitimate rights and interests of the listed company and shareholders.
4. Senior executives and incentives
The Companyengaged senior executives in strict accordance with the legal procedures and the Company’s articles of association, and
there was no situation that the controlling shareholders, actual controllers and their related parties interfered with the
normalprocedures for recruitment and selection of senior executives, or directly appointed and dismissed senior executives by
bypassing the shareholders’ meetings. The Company has established a mechanism for linking remuneration with company
performance and personal performance, taking the performance evaluation of senior executives as an important basis for
32
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
remuneration and other incentives for senior executives.
5. Controlling shareholders and their related parties
The controlling shareholdersof the Company exercisedtheir rights and fulfilledtheir obligations to the Company in accordance with
the law, and there was no situation that the controlling shareholders and actual controllers used their control rights to damage the
legitimate rights and interests of the Company and other shareholders. The controlling shareholders nominated or recommended
candidates for directors and supervisors in accordance with the conditions and procedures stipulated by laws and regulations and The
Company’s articles of association. The Company’s major decisions were made by the shareholders’ meetings and the board of
directors in accordance with the law. The Companywas separated from the controlling shareholders and actual controllers in terms of
personnel, assets, and finance, andindependent in terms of organization and business, with independent accounting and independent
responsibility and risk. The related transactions strictly performed decision-making procedures and information disclosure
obligations in accordance with relevant provisions.
6. Stakeholders, environmental protection and social responsibility
The Company respected the legitimate rights of the bank and other creditors, employees, customers, suppliers, communities and
other stakeholders. While maintaining the Company’s development, striving to improve business performance, and safeguarding the
interests of shareholders, it actively fulfilled its social responsibilities and conducted effective exchanges and cooperation with
stakeholders to jointly promote the sustainable and steady development of the Company and the industry.
7. Information disclosure and transparency
In strict accordance with laws and regulations, self-regulation rules and the articles of association, the Company earnestly fulfilled its
information disclosure obligations, continuously strengthened the standardization of information disclosure, conducted investor
exchanges in accordance with regulations, fully guaranteed shareholders’ right to know, guaranteed the transparency of information
disclosure, and ensured that all shareholders of the Company have equal access to information.
Whether there are material differences between the actual condition of corporate governance and the laws, administrative regulations
and rules with corporate governance concerned issued by CSRC on listed companies
□Yes √No
The actual condition of corporate governance does not differ materially from the laws, administrative regulations and rules issued by
CSRC with corporate governance concern on listed companies
II. Independence of the Company relative to controlling shareholder and the actual controller
in ensuring The Company’s assets, personnel, finance, organization and businesses
The Company is independent and completely separate from its controlling shareholder, actual controller and other related parties, in
terms of assets, personnel, finance, organization and business.
1. Assets
The Company has independent and complete assets with clear property rights, and there are no occupancy or domination by directors,
supervisors, senior executives, controlling shareholders, actual controller and other related parties.
2.Personnel
The Company has independent labor & personnel system and workforce; senior executives are appointed in accordance with the
regulations and do not hold any administrative position other than directors, supervisors in enterprise of controlling shareholder or its
enterprise under the control.
33
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
3.Finance
The Company has an independent financial department and established a separate financial accounting system with its own; and has
a standardized financial accounting system and financing management mechanism for branches and subsidiaries, also, The Company
has ability to make independent financial decisions without intervention from the controlling shareholders on capital use.
4.Organization
The Company established an independent and completed corporate governance structure and internal management organization.
BOD, BOS and other internal organization are operates independently and there are no mixed operations with its controlling
shareholders.
5.Business
The Company has a completed business system including procurement, production, sales and R&D system, and made independent
decisions with its own; self-operated and no reliance on shareholders and other related parties for production and operation activities.
III. Horizontal competition
□ Applicable √ Not applicable
IV. Annual General Meeting(AGM) and extraordinary shareholders’ general meeting held
during the reporting period
1. Shareholders’ General Meeting in the report period
Ratio of investor Resolution of the
Session of meeting Type Meeting date Date of disclosure
participation Meeting
Proposals
deliberated and
approved including:
(1)Report on Work
of the BOD for year
of 2020; (2) Report
on Work of the BOS
for year of 2020;
(3)Financial
Statement
Annual General
AGM 53.93% May 26, 2021 May 27, 2021 Presentation for Year
Meeting of 2020
of 2020; (4) Profit
Distribution Plan for
year of 2020; (5)
Annual Report of
2020; (6)Provision
of Guarantee for
Subsidiaries;
(7)Expected Daily
Related Transactions
for year of 2021;
34
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(8)Amendment of
Article of
Association; and
(9)Application for
Entrusted Loans
from China Potevio
Company Limited.
Deliberated and
approved Proposal
First Extraordinary
Extraordinary on Application for
Shareholders
Shareholders 53.93% May 27, 2021 May 28, 2021 Entrusted Loans
General Meeting of
General Meeting from China Potevio
2021
Company Limited
Proposals
deliberated and
approved including:
(1)Signing of the
Second Financial Service
Extraordinary Extraordinary Agreement with
Shareholders Shareholders 54.12% December 27, 2021 December 28, 2021 China Electronics
General Meeting of General Meeting Technology Group
2021 Corporation; and
(2)Appointment of
the Auditing
Organization for
year of 2021
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
V. Directors, supervisors and senior executives
1. Basic information
Amount Amount Reasons
Shares Shares
Start of shares of shares for
End date held at Other held at
Working dated of increased decrease increase
Name Title Sex Age of office period-b changes period-e
status office in this d in this or
term egin (share) nd
term period period decrease
(Share) (Share)
(Share) (Share) of shares
Sun Director, Currentl Male 49 Feb. 14, 0 0 0 0 0
35
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Xigang President y in 2022
office
Currentl
Wang Jan. 21,
Director y in Male 47 0 0 0 0 0
Wenkui 2019
office
Currentl
Wang Deputy Apr. 19,
y in Male 47 0 0 0 0 0
Wenkui President 2019
office
Currentl
Aug. 27,
Li Tong Director y in Male 51 0 0 0 0 0
2019
office
Currentl
Aug. 27,
Liu Yun Director y in Female 48 0 0 0 0 0
2019
office
Currentl
Qin Aug. 23,
Director y in Male 53 0 0 0 0 0
Zhen 2017
office
Currentl
Wang Aug. 23,
Director y in Female 51 0 0 0 0 0
Jinfeng 2017
office
Independ Currentl
Tang Aug. 23,
ent y in Female 65 0 0 0 0 0
Fuxin 2017
Director office
Independ Currentl
Xie Aug. 23,
ent y in Male 58 0 0 0 0 0
Manlin 2017
Director office
Du Independ Currentl
Aug. 23,
Xiaoron ent y in Female 53 0 0 0 0 0
2017
g Director office
Currentl
Supervis Aug. 27,
Lv Dong y in Male 50 0 0 0 0 0
or 2019
office
Chairma
n of the
Currentl
Supervis Aug. 28,
Lv Dong y in Male 50 0 0 0 0 0
ory 2019
office
Committ
ee
Currentl
Supervis Aug. 27,
Wei Jie y in Female 44 0 0 0 0 0
or 2019
office
36
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Currentl
Qiu Supervis Aug. 23,
y in Female 48 0 0 0 0 0
Huizhen or 2017
office
Currentl
Wang Jan. 4,
GM y in Male 47 0 0 0 0 0
Wenkui 2019
office
Currentl
Qin Deputy Aug. 26,
y in Male 53 0 0 0 0 0
Zhen GM 2016
office
Currentl
Jia Deputy Jun. 29,
y in Female 41 0 0 0 0 0
Haowen GM 2018
office
Currentl
Deputy May 29,
Lei Xu y in Male 53 0 0 0 0 0
GM 2019
office
Chief Currentl
Wang Aug. 29,
Account y in Male 54 0 0 0 0 0
Huilin 2019
ant office
Liu Currentl
General Apr. 20,
Xiaodon y in Female 50 0 0 0 0 0
counsel 2018
g office
Secretary Currentl
Aug. 23,
Li Jing of the y in Female 46 0 0 0 0 0
2017
Board office
Director,
Office Aug. 23, Jan. 12,
Xu Qian President Male 59 0 0 0 0 0
leaving 2013 2022
(former)
Total -- -- -- -- -- -- 0 0 0 0 0 --
During the reporting period, whether there was any departure of directors and supervisors and dismissal of Senior Executives
□Yes √No
Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Title Type Date Reasons
Director, Elected by Shareholders’ general meeting to serves as
Sun Xigang Be elected Feb. 14, 2022
President Director and serves as president elected by the BOD
Director,
Xu Qian Office leaving Jan. 12, 2022 Resignation
President
37
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2. Post-holding
Professional background, major working experience and present main responsibilities in Company of directors, supervisors and
senior executive at the present
Director:
Sun Xigang (Male), born in 1972, owns a master of business administration. Mr. Sun worked as a technician and assistant engineer in
the First department of 28th Research Institute of China Electronics Technology Group Corporation (CETC), the project manager,
deputy director, director and secretary of Party Branch of science & technology division in CETC, director of planning management
division of CETC, the special assistant to the director and director of capital management office of CETC; he is currently the deputy
GM of CETC LES Information System Co., Ltd. and Party Secretary and President of Nanjing Putian Telecommunications Co., Ltd.
Wang Wenkui (Male), born in 1974, bachelor of engineering and joined the workforce in 1996. Mr. Wang served as the deputy
manager of WCDMA project dept., WCDMA project manager and manager of the WCDMA project of Network Communication
Research Institute of Eastcom Co.,Ltd, the deputy GM of Hangzhou Sanxing Eastcom Network Technology Co., Ltd., deputy GM of
the wireless trunking division of Eastcom Co., Ltd, GM of the manufacturing division of Eastcom Co., Ltd and deputy president and
GM of finance division of Eastcom Co., Ltd. Now he is the deputy president and GM of Nanjing Putian Telecommunications Co., Ltd.
Li Tong(Male), born in 1970, master of business administrationand joined the workforce in 1993. Mr. Li served as the director of
business planning division under the enterprise management dept. and deputy GM of China Putian Corporation; deputy director of
corporate restructuring office, deputy GM of corporate development division and manager of corporate operation division I of the
China Putian Corporation; deputy GM of corporate development division, manager of corporate operation division I and deputy GM
of corporate development division of the China Potevio; GM of the Nanjing Putian Communication Technology Industrial Park Co.,
Ltd; Deputy GM, deputy secretary of the Party Committee, secretary of Discipline Inspection Committee and secretary of the Party
Committee of Nanjing Putian Telecommunications Co., Ltd.; GM of the Audit/Inspection/Legal Affairs dept. of China Potevio;
deputy head of the Discipline Inspection Group of the Party and director of the GM office of China Putian Corporation; GM of the
general affairs dept., deputy head of the Discipline Inspection Group of the Party of China Potevio; office manager, director of office
of the GM (President) and director of the Office of the BOD of China Putian Corporation (China Potevio); GM of the integrated
management dept. of China Putian Corporation (China Potevio) and the assistant GM of China Putian Corporation; currently Mr. Li
is the Party Secretary and President of Beijing Putian Taili Communication Technology Co., Ltd., secretary of the Board of China
Putian Corporation (China Potevio) and Director of Nanjing Putian Telecommunications Co., Ltd.
Liu Yun (Female), born in 1973, master of economics and joined the workforce in 1997. She served as assistant general manager of
Investment Department of China National Textiles Import and Export Corporation; the assistant general manager of Chinatex
International Apparel Co., Ltd.; the financial director of the Preparation Office of the Infolex LLc Beijing Office; head of the
investment management of corporate development dept.,investment management manager, assistant GM of the corporate
development dept. and deputy GM of China Potevio; from October 2013 to October 2018, she successively served as the assistant
general manager and deputy general manager (October 2016) of Enterprise Development Department of China Potevio Information
Industry Co., Ltd.; from October 2018 to June 2019, she served as the deputy general manager of Putian Innovation and
Entrepreneurship Management Co., Ltd.; from June 2019 to the present, she has been the general manager of the Enterprise
Operation Department of China Putian Corporation; deputy GM of Putian Innovation and Entrepreneurship Management Co., Ltd,
and the GM of corporate operation dept. of China Putian Corporation. Now she is the senior manager of the Putian restructuring
promotion office of China Electronics Technology Group Corporation and Director of Nanjing Putian Telecommunications Co., Ltd.
Qin Zhen (Male), born in 1968, bachelor of engineeringand joined the workforce in 1990. Mr. Qin worked as the production office
38
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
scheduling and department assistant in Nanjing Communication Equipment Plant; the deputy GM and deputy secretary of the Party
branch in wiring Company of Nanjing Putian Telecommunication Co., Ltd.; deputy director of the enterprise development dept. and
enterprise management dept. and director of the enterprise management dept. in Nanjing Putian Telecommunication Co., Ltd. and
GM of the Putian Industrial Co., Ltd.; deputy GM in network cabinet division (Machinery) of the Company; GM in manufacturing
division, the Party Branch Secretary, director of Party Committee Work Department and vice president of Trade Union of Putian;
assistant GM of Nanjing Putian Telecommunication Co., Ltd; now he is the Director and Deputy GM of Nanjing Putian
Telecommunication Co., Ltd.
Wang Jinfeng (Female), born in 1970, bachelor of economicsand joined the workforce in 1993. Ms. Wang worked as the accounting
officer of the finance department and accounting supervisor of marketing center in theBeijing Posts and Telecommunications
Equipment Factory; the position of financial accounting manager of Beijing Capitek Co. Ltd.; the financial manager of terminal
services, agency services, agency and telecommunications services of China Potevio Company Limited; the assistant general
manager of financial department of China Potevio Company Limited, the deputy general manager of financial department of China
Potevio Company Limited; now she is the CFO of Potevio Information Technology (Chongqing) Co., Ltd. and Director of Nanjing
Putian Telecommunication Co., Ltd.
Tang Fuxin (Female), born in 1956, obtaining a master's degree, a senior accountant and joined the workforce in 1975. She served as
an accountant of financial division and the deputy director of inspection division of the original ministry of posts and
telecommunications; the manager of planning financial department of the original Guoxin Paging Co., Ltd.; the deputy general
manager of financial department of China United Communications Limited; the deputy general manger and general manager of
financial department, general manager and senior manager of auditing department of China United Communications Limited;Ms.
Tang currently is the Independent Director of Nanjing Putian Telecommunication Co., Ltd.
Xie Manlin (Male), born in 1963, Master of laws and joined the workforce in 1986. He worked in the Nanjing Second Laws and
Nanjing Jinling Laws Firm; and now Mr. Xie is the director of Jiangsu Xie Manlin Laws Firm and the Independent Director of
Nanjing Putian Telecommunication Co., Ltd.
Du Xiaorong (Female), born in 1968, doctor of management and joined the workforce in1989. Ms. Du worked as an assistant teacher
at the management department of Hohai University; a lecturer of International Business School of Hohai University; an associate
professor of Business School of Hohai University; assistant of the director of planning division of Taihu Basin Administration,
ministry of water resources(workplace attachment); an assistant professor of Business School and the deputy director of
Chrematistics Department of Hohai University; the director of Chrematistics Department of Hohai University; a professor of
Business School and director of Chrematistics Department of Hohai University; Ms. Du now is the professor of Business and head of
accounting department of the Hohai University and the Independent Director of Nanjing Putian Telecommunication Co., Ltd.
Supervisor:
Lv Dong (Male), born in 1971, master of managementand joined the workforce in 1995. Mr. Lv served as an accounting accountant
of the Finance Office of Beijing Power Equipment Group Co., Ltd.; the auditor of the Audit Branch of North China Power Bureau;
he was seconded to the 13th Office of the Board of Supervisors of the Central Enterprise Work Committee; the project manager of
Tianhua Certified Public Accountants; the auditor of the Audit Department of China Putian Corporation; the audit practice manager
of Audit & Inspection department and Auditing department, deputy manager of auditing department, manager of audit department,
audit inspection & legal affair department, deputy general manager of audit, inspecction & legal affair department and the audit
manager of China Potevio; the deputy general manager of the Audit Department of Chian Putian Corporation; now Mr. Lv is the
39
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
project manager of the assurance division under the Putian Restructuring Promotion Leadership Office of China Electronics
Technology Group Corporation and Chairman of the Supervisory Committee of Nanjing Putian Telecommunication Co., Ltd.
Wei Jie (Female), born in 1977, master of lawand joined the workforce in 2001. She served as a legal specialist of Beijing Urban
Construction First Construction Engineering Co., Ltd.; the lawyer and chief lawyer of the Legal Affairs Department of the
Comprehensive Management Department, and a supervisor lawyer, senior lawyer, legal manager of the Audit and Supervision Legal
Department of China Potevio.; the director of the Discipline Inspection Case Review Office of the Legal Risk Control Department of
China Putian Corporation; the legal manager of the Legal Risk Control Department ofChina Putian Corporation; now she is the
project manager, legal audit risk control department of China Electronics Technology Group Corporation and Supervisor of Nanjing
Putian Telecommunication Co., Ltd.
Qiu Huizhen (Female), born in 1973, bachelor of economics and joined the workforce in 1997. Ms. Qiu served as the female director
and secretary of the Youth League Committee in Shaokou Village Government, Wan’an County, Jiangxi Province; the cost
accountant and the CFO in the finance department of Nanjing Putian Telecommunications Co., Ltd; the deputy director of the HR
department and deputy director/director of the finance department of Nanjing Putian Telecommunications Co., Ltd; currently she is
the director of audit, supervision & legal affair department and employee representative supervisors of Nanjing Putian
Telecommunication Co., Ltd.
Senior Executives:
Main work experience of GM Mr. Wang Wenkui has been introduced in the above Directors.
Main work experience of deputy GM Mr. Qin Zhen has been introduced in the above Directors.
Jia Haowen (Female), born in 1980, bachelor of management andjoined the workforce in 2002. Mr. Jia worked on administrative
management and sales at Shanghai Xinhaoshi Real Estate Company; the president’s office secretaries and secretary, assistant director
of general management department, assistant director of human resources, president and vice president of the human resources and
the director of general management department of Nanjing Putian Telecommunications Co., Ltd; assistant GM and head of the
multimedia application industry division of Nanjing Putian Telecommunications Co., Ltd; currently she is the deputy GM of Nanjing
Putian Telecommunications Co., Ltd.
Lei Xu (Male), born in 1968,Doctor of Engineering andjoined the workforce in1989. Mr. Lei worked as a product quality inspector in
Wuhan Changjiang Transformer Factory; teaching and research at Harbin Institute of Technology; worked as the physical-layer
algorithm research engineer in the wireless access technology division of the 4G department of information technology research
institute of Putian; the manager of system planning department/wireless access technology department of the Potevio Institute
Technology Co., Ltd., the standards and national special director, product director of marketing department V (information security
product line) of the Potevio Information Technology Co., Ltd; and a assistant to the mayor (temporary job) of Yingtan, Jiangxi
Province ; currently he is the deputy GM and head of strategic science & technology department of the Nanjing Putian
Telecommunications Co., Ltd.
Wang Huailin (Male), born in 1967, master of engineering, senior accountantandjoined the workforce in 1991. He worked as a
teacher at Funan Normal College in Anhui Province; the employee of the Finance Department and financial manager of Electronic
Equipment Department ofEastcom Co., Ltd.; financial director of Hangzhou Lingtong Electronic Equipment Co., Ltd.; CFO of Hefei
Dongxin Real Estate Development Co., Ltd.; deputy general manager of the Financial Department of Putian Eastcom Group Co., Ltd.,
the committee member of Discipline Inspection Commission, deputy general manager and general manager of Finance Department
40
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
of Putian Eastcom Group Co., Ltd.; currently he is the chief accountant of Nanjing Putian Telecommunications Co., Ltd.
Liu Xiaodong (Female), born in 1971, bachelor of economics andjoined the workforce in 1995. Ms. Liu served as the accountant,
auditor, deputy director of the audit department, deputy director of the Audit and Supervision Department, head of the Audit and
Supervision Department, and the head of the Audit Law Department, and the head of the Audit and Supervision Law Department of
Nanjing Putian Telecommunications Co., Ltd.; the deputy secretary of the Disciplinary Inspection Committee and employee supervisor
of Nanjing Putian Telecommunications Co., Ltd.; currently she is the deputy secretary of the Party Committee, secretary of the
Discipline Inspection Committee, chairman of the labor union and General counsel of Nanjing Putian Telecommunications Co., Ltd.
Li Jing (Female), born in 1975, master of managementandjoined the workforce in 1996. Ms. Li worked as the secretary and customs
declaring in Nanjing Mennekes; the buyer and industrial officer of Nanjing Potevio Computer Co., Ltd; the investment management
officer, deputy director of the corporate development department and director of the strategic investment department of Nanjing
Putian Telecommunications Co., Ltd; currently she is the Assistant GM, secretary of the Board and director of corporate
development department of Nanjing Putian Telecommunications Co., Ltd.
Post-holding in shareholder’s unit
√ Applicable □ Not applicable
Received
Position in
Start dated of End date of remuneration from
Name Name of shareholder’s unit shareholder’s
office term office term shareholder’s unit
unit n
(Y/N)
Secretary of
Li Tong China Potevio Company Limited 2019-11-09 N
the Board
Explanation China Potevio is the controlling shareholder of the Company
Post-holding in other unit
√ Applicable □ Not applicable
Received
Position in Start dated of End date of office remuneration
Name Name of other units
other unit office term term from other unit
(Y/N)
Secretary of
Li Tong China Putian Corporation 2019-11-09 Y
the Board
Secretary of
Beijing Putian Taili Communication Party
Li Tong 2021-08-18 N
Technology Co., Ltd Committee,
President
senior
China Electronics Technology Group
Liu Yun manager of 2021-08-01 Y
Corporation
the Putian
41
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
restructuring
promotion
office
Liu Yun Putian Logistic Technology Co., Ltd. Director 2017-02-28 N
Liu Yun Potevio New Energy Co., Ltd. Director 2018-04-13 N
Puxing Mobile Communication Equipment
Wang Jinfeng Director 2015-12-21 N
Co., Ltd.
Potevio Information Technology
Wang Jinfeng CFO 2020-07-21 N
(Chongqing) Co., Ltd.
Xie Manlin Jiangsu XieManlin Laws Firm Director 1994-12-01 Y
Independent
Xie Manlin Saurer Intelligent Technology Co., Ltd. 2017-08-26 Y
Director
Professor,
head of
Du Xiaorong Business school of Hohai University 2013-06-15 Y
department of
accounting
Project
manager of
the assurance
division under
China Electronics Technology Group
Lv Dong the Putian 2021-08-01 Y
Corporation
Restructuring
Promotion
Leadership
Office
Lv Dong Wuhan Putian Power Co., Ltd. Supervisor 2016-05-24 N
Puxing Mobile Communication Equipment
Lv Dong Supervisor 2015-12-21 N
Co., Ltd.
Potevio Information Engineering Design
Lv Dong Supervisor 2016-08-04 N
Service Co., Ltd.
Lv Dong Potevio Information Trade Co., Ltd. Supervisor 2018-07-11 N
Project
manager,
China Electronics Technology Group
Wei Jie legal audit 2021-08-01 Y
Corporation
risk control
department
Wei Jie Potevio Guomai Networks Ltd. Supervisor 2016-12-02 N
Potevio Information Technology
Wei Jie Supervisor 2020-07-21 N
(Chongqing) Co., Ltd.
42
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Wang Huilin Eastcom Ventures Supervisor 2015-12-11 N
Explanation China Electronics Technology Group Corporation is the actual controller of the Company
Punishment of securities regulatory authority in recent three years to the Company’s current and outgoing directors, supervisors and
senior management during the reporting period
√ Applicable □ Not applicable
In 2019, as a current president of Shanghai Putian, Mr. Xu Qian was warned and fined 50,000 yuan by CSRC for the information
disclosure of Shanghai Putian.
3. Remuneration for directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
The Company has not paid directors and supervisors, the directors and supervisors get paid as The Company's administrative duties.
The independent directors receive the allowance in The Company, while subsidiary standard is determined by the general meeting of
shareholders. Senior management personnel salary standard and assessment methods are decided by the board of directors.
The Company implements performance salary system on senior management, making evaluation and paying compensation according
to the completion of the production and operation as well as performance of the senior management personnel.
Remuneration for directors, supervisors and senior executives during the reporting period
Unit: 10’000 yuan
Total Whether
remuneration remuneration
Post-holding
Name Title Sex (M/F) Age obtained from obtained from
status
The Company related party of
(before taxes) the Company
Currently in
Sun Xigang President Male 49 Y
office
Currently in
Wang Wenkui Deputy President Male 47 N
office
Currently in
Li Tong Director Male 51 Y
office
Currently in
Liu Yun Director Female 48 Y
office
Currently in
Qin Zhen Director Male 53 N
office
Currently in
Wang Jinfeng Director Female 51 Y
office
43
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Independent Currently in
Tang Fuxin Female 65 9N
Director office
Independent Currently in
Xie Manlin Male 58 9N
Director office
Independent Currently in
Du Xiaorong Female 53 9N
Director office
Chairman of the
Currently in
Lv Dong Supervisory Male 50 Y
office
Committee
Currently in
Wei Jie Supervisor Female 44 Y
office
Currently in
Qiu Huizhen Supervisor Female 48 22.17 N
office
Currently in
Wang Wenkui GM Male 47 80 N
office
Currently in
Qin Zhen Deputy GM Male 53 36.56 N
office
Currently in
Jia Haowen Deputy GM Female 41 41.88 N
office
Currently in
Lei Xu Deputy GM Male 53 34.12 N
office
Currently in
Wang Huilin Chief Accountant Male 54 54.35 N
office
Currently in
Liu Xiaodong General counsel Female 50 36.38 N
office
Secretary of the Currently in
Li Jing Female 46 34.4 N
Board office
Director,
Xu Qian Male 59 Office leaving Y
President(former)
Total -- -- -- -- 366.86 --
VI. Responsibility performance of directors during the reporting period
1. The board of directors during the reporting period
Session of meeting Date of meeting Disclosure date Meeting resolutions
Deliberated and approved the
th th
The 46 Session of 7 BOD 2021-01-21 2021-01-22 proposal on Acquisition of 25%
Equity of Nanjing Nanman
44
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Electric Co., Ltd.
Deliberated and approved the
proposal on Application for
The 47th Session of 7th BOD 2021-03-09 2021-03-10
Entrusted Loans from China
Potevio
Proposals deliberated and
approved including: (1)Report
on Work of the BOD for year of
2020; (2) Report on Work of the
GM for year of 2020;
(3)Financial Statement
Presentation for Year of 2020;
(4) Financial Budget Report for
year of 2021; (5) Profit
Distribution Plan for year of
2020; (6) Annual Report of
2020 and Summary of Annual
The 48th Session of 7th BOD 2021-04-16 2021-04-20
Report 2020; (7) Provision for
Assets Impairment in 2020; (8)
Internal Control Assessment
Report for year of 2020; (9)
Application for a Credit Line
From a Bank; (10)Provision of
Guarantee for Subsidiaries;
(11)Expected Daily Related
Transactions for year of 2021;
(12)Amendment of Article of
Association and (13)Convening
of the AGM of 2020
Deliberated and approved the
th th
The 49 Session of 7 BOD 2021-04-28 proposal on First Quarterly
Report of 2021
Proposals deliberated and
approved including:
(1)Application for Entrusted
Loans from China Potevio; and
The 50th Session of 7th BOD 2021-04-30 2021-05-07
(2)Convening of the First
Extraordinary Shareholders
General Meeting for year of
2021
Proposals deliberated and
st th
The 51 Session of 7 BOD 2021-08-25 2021-08-27 approved including: (1)Report
on Work of the GM for the first
45
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
half of 2021; (2) Budget
Performance Report for the first
half of 2021; (3)Semi-Annual
Report of 2021 and its
Summary; and (4) Provision for
Impairment of Assets in the first
half of 2021
Proposals deliberated and
approved including: (1)The
Third Quarterly Report of 2021;
(2) Increase the Forecast of
nd th
The 52 Session of 7 BOD 2021-10-28 2021-10-30 Daily Related Transactions for
year of 2021; and (3)
Liquidation and Closure of
Putian Telecommunication
(H.K.) Co., Ltd.
Proposals deliberated and
approved including: (1)Signing
the Financial Service
Agreement with CETC Finance
Co., Ltd.; (2) Risk Assessment
Report of CETC Finance Co.,
The 53rd Session of 7th BOD 2021-11-23 2021-11-24 Ltd.; (3) Risk Management Plan
for the Deposit and Loans
Business in CETC Finance Co.,
Ltd.; and (4) Convening of the
Second Extraordinary
Shareholders General Meeting
for year of 2021
Deliberated and approved the
proposal on Appointment of the
The 54th Session of 7th BOD 2021-12-08 2021-12-10
Auditing Institution for year of
2021
2. The attending of directors to Board meetings and shareholders general meeting
The attending of directors to Board Meeting and Shareholders General Meeting
Times of
Times of Absent the Times of
attending the
Board meeting Times of Meeting for attend the
Times of Board Meeting Times of
Director supposed to entrusted the second shareholders’
Presence by Absence
attend in the presence time in a row general
communicatio
report period (Y/N) meeting
n
46
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Xu Qian 9 0 9 0 0N 0
Wang Wenkui 9 0 9 0 0N 3
Li Tong 9 0 9 0 0N 0
Liu Yun 9 0 9 0 0N 0
Qin Zhen 9 0 9 0 0N 1
Wang Jinfeng 9 0 9 0 0N 0
Tang Fuxin 9 0 9 0 0N 0
Xie Manlin 9 0 9 0 0N 0
Du Xiaorong 9 0 9 0 0N 2
Explanation of absent the Board Meeting for the second time in a row
Not applicable
3. Objection for relevant events from directors
Directors come up with objection about Company’s relevant matters
□ Yes √ No
No directors come up with objection about Company’s relevant matters in the Period
4. Other explanation on responsibility performance of directors
The opinions from directors have been adopted
√ Yes □ No
Director's statement to the Company that a proposal has been or has not been adopted
During the reporting period, all directors are carrying out the works in strictly accordance with the legal regulations as Company Law,
Securities Law, Rules Governing the Stock of Listing on Shenzhen Stock Exchange, Guidelines on Standardized Operation of Listed
Companies on Shenzhen Stock Exchange and Article of Association of the Company. Attend the Board Meeting on time, and study
the proposals submitted to the Board according to actual condition of the Company, and making prudent decisions; supervise and
promote the implementation of proposals and safeguard the legitimate rights and interest of the Company and all shareholders.
VII. The special committees under the BOD during the reporting period
Important Specific
Other
Committee Number of Meeting comments and circumstances
Members Date of performance of
name meetings held content suggestions of the objection
meeting duties
made (if applicable)
Deliberated the The financial
Auditing Du Xiaorong, financial accounting
Committee of Tang Fuxin and 5 2021-04-06 accounting statement for
the Board Wang Jinfeng statement for year of 2020
year of 2020 that audited by
47
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
that audited by Pan-China
Pan-China Certified
Certified Public
Public Accountants
Accountants (LLP) was
(LLP) deliberated and
approved,
agreed to
submit the
statement to the
Board for
consideration.
Deliberated
Deliberated the and approved
2021-04-21 First Quarterly the First
Report of 2021 Quarterly
Report of 2021
Deliberated
Deliberated the and approved
Semi-Annual the
2021-08-12 Report of 2021 Semi-Annual
and its Report of 2021
Summary and its
Summary
Deliberated
Deliberated the and approved
2021-10-19 Third Quarterly the Third
Report of 2021 Quarterly
Report of 2021
Deliberated
and approved
the proposal on
appointment of
auditing
Deliberated the
institution for
appointment of
year of 2021,
2021-12-02 auditing
agreed to
institution for
propose to the
year of 2021
Board to
re-appoint
Pan-China
Certified
Public
48
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Accountants
(LLP) as the
financial and
internal control
auditor for
2021
VIII. Works from BOS
The Company has risks in reporting period that found in supervisory activity from BOS
□ Yes √ No
BOS has no objection to the supervision matters during the reporting period
IX. Particulars of workforce
1. Number of staff, professional composition and education background
Employee in-post of the parent Company at period-end(people) 319
Employee in-post of main Subsidiaries at period-end (people) 716
The total number ofcurrent employees at period-end(people) 1,035
The total number of current employees to receive pay (people) 1,217
Retired employee’ s expenses borne by the parent Company and
365
main Subsidiaries(people)
Professional composition
Category of professional composition Number of professional composition (people)
Production staff 268
Salesman 341
Technical staff 286
Financial staff 30
Administrative staff 110
Total 1,035
Education background
Category of education Number (people)
Master’s degree above 21
Bachelor 417
Junior college 377
High school and below 220
49
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Total 1,035
2. Remunerationpolicy
The Company strictly implements the national, provincial and municipal laws and regulations, andnormatively implemented the
distribution and payment of compensation and benefits. In order to further mobilize the enthusiasm, initiative and creativity of the
employees, The Company implements an efficiency-oriented, performance-based compensation distribution mechanism, and
formulates salary and performance appraisal methods for different positions according to their different characteristics, and at the same
time, pays five insurances and one housing fund and enterprise annuitiesaccording to relevant national regulations.
3. Training programs
The Company always adheres to the people-oriented development concept, continuously carries out employee training, and establishes
and continuously improves the matching training system according to the Company’s development needs, and improves the quality of
the staff. At the same time, The Company attaches great importance to the improvement of employees' comprehensive capabilities
and closely follows the development trend of the industry, we will continue to innovate talent training methods, pay attention to the
cultivation of compound talents, rationally arrange flexible learning methods, strengthen training in layers and grades, formulate annual
training plans, and do a good job in talent reserves and cultivation of young cadres for the Company to implement innovation
transformation.
4. Labor outsourcing
□ Applicable √ Not applicable
X. Profit distribution plan and capitalizing of common reserves plan
Formulation, Implementation and Adjustment of Profit Distribution Policy Especially Cash Dividend policy during the Reporting
Period
□ Applicable √ Not applicable
The Company earnings during the reporting period and profit available for distribution to shareholders from parent company is
negative, but no cash dividend distribution plan has been proposed
□ Applicable √ Not applicable
Profit distribution plan and capitalizing of common reserves plan for the Period
□ Applicable √ Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from capital reserve either for
the year.
50
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
XI. Implementation of the Company’s stock incentive scheme, employee stock ownership plan
or other employee incentives
□ Applicable √ Not applicable
The Company has no stock incentive scheme, employee stock ownership plan or other employee incentives during the reporting
period
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
The Company has established a complete set of internal control systems that run through all aspects of daily operation and
management activities in accordance with various national laws and regulations, as well as the industry, business mode and its own
business characteristics, and has continuously improved it to form a standardized management system. In terms of corporate
governance, the Company has formulated the Articles of Association, Rules of Procedure for Shareholders’ Meetings, Rules of
Procedure for Board of Directors, Rules of Procedure for Board ofSupervisors, Work Rules of General Manager, Work System of
Independent Director and other systems. In terms of the daily operation and management, the Company has formulated the Fixed
Assets Management Measures, Guarantee Management Measures, Investment Management System, Attendance Management
System, Employee Leave Management System, Recruitment Management System, Employee Resignation Management System,
Equipment Management Measures, Procurement Management Measures, etc., covering the Company’s human resources
management, financial asset management, legal affairs management, investment management, auditing, informatization, market,
technology, quality, procurement management and other work content involved in daily production and operation, so as to ensure the
orderly work of the Company. In addition, the Company has also implemented safety standardization and quality, environment, and
safety integrated management systems, and has formed a number of documents including safety standardization documents,
integrated management system manuals, and procedural documents.
The Company supervises and self-monitors the internal control system and its implementation through various methods such as
annual internal control self-evaluation, internal control external audit, inspection and acceptance of integrated management system,
and irregular special inspections.
At present, the Company has established a relatively complete internal control system which has been effectively implemented and
has achieved the goal of the Company’s internal control, and there are no major defects. With the development needs of the
Company’s business scale and business scope, the Company will continue to improve the internal control system, strengthen the
implementation of the internal control system, and promote the healthy development of the Company.
2. Details of major defects in IC appraisal report that found during reporting period
□Yes √No
XIII. Management and controls on the subsidiary during reporting period
The Company implements management control over its subsidiaries in accordance with the Company Law and other laws and
regulations and the requirements of the competent authorities. The Company appoints directors, supervisors, managers, chief
financial officers, etc. to the subsidiaries to participate in the decision-making and supervision of major events of the subsidiaries;
51
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
assigns economic and management assessment indicators to the Company, and conducts regular assessments; the Company’s
functional departments implement corresponding control and internal supervision on important matters such as operations
managementand financial management of subsidiaries, so as to carry out multi-level, continuous and effective supervision and
control over subsidiaries to ensure that the operation direction of subsidiaries is in line with the Company’s overall strategy and
business management objectives. New subsidiaries increased for the acquisition during the reporting period:
Problems
Integration Measures taken to Progress in Follow-up
Name Integration plans encountered in
progress resolve solution solution plan
integration
N/A Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable
XIV. Internal control self-assessment report or internal control audit report
1. Self-assessment Report of Internal Control
Disclosure date of full internal control
2022-04-26
assessment report
Disclosure index of full internal control Assessment report of internal control for year of 2021 of Nanjing Putian
assessment report Telecommunications Co., Ltd. published on Juchao Website (www.cninfo.com.cn)
The ratio of the total assets of units
included in the scope of evaluation
accounting for the total assets on The 100.00%
Company's consolidated financial
statements
The ratio of the operating income of units
included in the scope of evaluation
accounting for the operating income on 100.00%
The Company's consolidated financial
statements
Defects Recognition Standards
Category Financial Reports Non-financial Reports
Indicators for material defect of internal Indicators for material defect of internal
control in financial report: invalid control control in non-financial report:
environment; fraud by our directors, decision-making procedures lead to
supervisors and senior management, which material faults; lack of system control or
brings significant loss and negative system void for major business, and lack
influences to the Company; external auditor of effective compensation control;
Qualitative criteria
finds material misstatement which is not first serious loss of senior management and
found by the Company; the board of senior technicians; assessment results of
directors or the authorized body and internal internal control, especially material
audit department conduct invalid supervision defects, are not rectified; other situations
over our internal control. Indicators for that would materially and adversely
major defect of internal control in financial affect The Company. Indicators for major
52
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
report: not select and apply accounting defect of internal control in non-financial
policies under the generally accepted report: decision-making procedures lead
accounting principles; not establish to general fault; defects exist in major
anti-fraud procedures and controlling business systems; serous loss of key
measures; not establish corresponding staff; assessment results of internal
controlling system or not implement control, especially major defects, are not
corresponding compensation control in rectified; other situations that would
connection with accounting for abnormal or relatively materially and adversely affect
special transactions; one or more defects The Company. Indicators for general
exist in control of ending financial reports defect of internal control in non-financial
and there is no assurance that financial report: low efficiency of
statement prepared correspondingly is decision-making procedures; defects
truthful and accurate. General defect: other exist in general business systems; serious
internal control defects that do not constitute loss of general staff; general defects are
material or major defects. not rectified.
Any of the following situations may be
viewed as material defect: potential
misstatement of total profit ≥ 5% of total
profit; potential misstatement of total assets
≥ 1% of total assets; potential misstatement
of operating income ≥ 1% of total operating
income. Any of the following situation may
Major deficiencies:the amount of direct
be viewed as major defect: 3% of total profit
property loss is or more than 10 million
≤ potential misstatement of total profit＜
Yuan; Significant deficiencies: the
5% of total profit; 0.5% of total assets ≤
amount of direct property loss is between
Quantitative standard potential misstatement of total assets＜ 1%
5 million Yuan and 10 million Yuan (5
of total assets; :0.5% of total operating
million Yuan included); Common
income ≤ potential misstatement of operating
deficiencies:the amount of direct
income ＜ 1% of total operating income.
property loss is less than 5 million Yuan.
Any of the following situation may be
viewed as general defect: potential
misstatement of total profit＜3% of total
profit; potential misstatement of total assets
＜ 0.5% of total assets; potential
misstatement of operating income ＜ 0.5%
of total operating income.
Amount of significant defects in financial
0
reports
Amount of significant defects in
0
non-financial reports
Amount of important defects in financial
0
reports
Amount of important defects in 0
53
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
non-financial reports
2. Auditing report of internal control
√ Applicable □ Not applicable
Deliberations in Internal Control Audit Report
We believe that according to relevant regulations and Basic Norms of Internal Control, The Company maintained an efficiency
internal control of financial report dated 31st December 2021, in all material aspects.
Disclosure details of audit report of
Disclosed
internal control
Disclosure date of audit report of
2022-04-26
internal control (full-text)
Index of audit report of internal Audit report of internal control for year of 2021 of Nanjing Putian Telecommunications Co.,
control (full-text) Ltd. published on Juchao Website (www.cninfo.com.cn)
Opinion type of auditing report of
Standard unqualified
IC
whether the non-financial report
No
had major defects
Carried out modified opinion for internal control audit report from CPA
□Yes √ No
The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued from the Board
√ Yes □ No
XV. Rectification of Self-examination Problems in Special Governance Actions in Listed
Company
During the reporting period, in accordance with the requirements of the China Securities Regulatory Commission and the CSRC
Jiangsu Bureau,the Companycarefully carried outspecial self-examination and problem rectification work of list
companiescomparing with the special self-examinationlist of listed Company governance. By self-examination, it was found that the
Company did not timely change the term of office of the seventh board of directors. The term of office of the seventh board of
directors expired in August 2020, due to the reorganization between the actual controller China PotevioandCETC, the term of office
has not been changed yet.
Rectification: The Company is actively communicating with China PotevioandCETC about the change of term of office of the board
of directors, and strives to complete the change as soon as possible. Before the completion of the change of term of office, all
directors, supervisorsand senior executives will continue to perform their duties in accordance with laws and regulations and the
provisions of articles of association. At a later period of time, theCompany will strictly abide by laws and regulations such as the
Company Law and the provisions of Articles of Association, standardize the work procedure for the change of term of office of the
board of directors, communicate in advance, do a good job in the selection of directors candidates, and appoint them strictly on
schedule.
54
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section V. Environmental and Social Responsibility
I. Major environmental
The listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection department
□Yes √ No
Administrative punishment for environmental problems during the reporting period
The impact on the
The Company's
Name of company or Reason for production and
Violation Punishment result rectification
subsidiary punishment operation of listed
measures
companies
- - - - - -
Other environmental information disclosed refer to key polluters
-
Measures taken to reduce carbon emissions during the reporting period and their effects
□ Applicable √ Not applicable
Reasons for not disclosing other environmental information
The Company and its subsidiaries do not belong to the key emission enterprises announced by the environmental protection
authorities. During the reporting period, The Company stringently implementing the relevant laws and regulations on national
environmental protection, and there is no violation of environmental laws and regulations, no administrative penalties by
environmental protection authorities for violating the environmental regulations.
II. Social responsibility
Based on the communications industry, The Company adheres to independent innovation, continuously promotes the sustainable
development of itself, and fulfills its responsibilities and obligations to the interested parties, and strive to achieve the harmonious
and win-win development of the enterprises, staff, society and environment.
The Company continuously improves and optimizes corporate governance, earnestly fulfills its obligation of information disclosure,
ensures shareholders’ right to know, right to participate and right to vote on major matters of the Company, and guarantees the
legitimate rights and interests of all shareholders.
The Company attaches great importance to quality, environment and occupational safety and health management. It has passed
GB/T19001-2016/ISO9001:2015 quality management system certification, GB/T24001-2016/ISO14001:2015environmental
management system certification, and GB/T45001-2020/ISO45001:2018 occupational health and safety management system
certification, and constantly strives to promote environmental protection and sustainable development.
The Company strictly abides by the Labor Law, Labor Contract Law and other laws and regulations, always adheres to the
people-oriented core values, attaches great importance to the value of employees, cares about the work, life, health and safety of
employees, effectively protects the rights and interests of employees, enhances the cohesion of the Company, devotes to the
55
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
realization of the joint development vision of the Company and its employees.
The Company has always kept in mind the mission and responsibility of a central enterprise, enthusiastically devoted itself to social
public welfare undertakings, and actively participated in various love assistance activities. In 2021, the Company carried out
consumption poverty alleviation work and purchased Qinghai local specialties from impoverished areas in Qinghai; participated in
the donation activities of Spring Bud Dreams of Jiangsu Women and Children’s Welfare Foundation, the volunteer service of Youth
Volunteering to the Party’s Beautiful Jiangsu, Love Angels in Action, volunteer service in the fight against the pandemic and many
other public welfare activities.
Based on the principles of honesty and trustworthiness and operating in accordance with the law, the Company actively builds
partnerships with suppliers, customers, banks and other relevant stakeholders, respects the legitimate rights and interests of
stakeholders, achieves a win-win situation between the Company and relevant stakeholders, and promotes the Company’s sustainable
and steady development.
III. Consolidating and expanding the achievements of poverty alleviation and rural
revitalization
During the reporting period, The Company carried out works of consumer poverty alleviation and purchased 59700 yuan local
specialties from poverty-stricken zone of Qinghai Province, and relevant works will continue to be carried out in later period.
56
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section VI. Important Events
I. Implementation of commitment
1. Commitments that the actual controller, shareholders, related party, buyer and The Company have
fulfilled during the reporting period and have not yet fulfilled by the end of reporting period
√ Applicable □ Not applicable
Commitments Type of Content of Date of Term of Implementatio
Commitments
party commitments commitments commitments commitments n
Commitments for share merger
reform
Content of
Commitments commitments
China
on horizontal see ―2.
Electronics
competition, Specific August 31, In normal
Technology Long-term
related commitments‖ 2021 performance
Group
transactions . See
Corporation
and fund ―Commitment
occupation 1‖
Commitments
China
on horizontal
Electronics See
Commitments in report of competition, August 31, In normal
Technology ―Commitment Long-term
acquisition or equity change related 2021 performance
Group 2‖
transactions
Corporation
and fund
occupation
Commitments
China
on horizontal
Electronics See
competition, August 31, In normal
Technology ―Commitment Long-term
related 2021 performance
Group 3‖
transactions
Corporation
and fund
occupation
China
Commitments See
Potevio; October 13, In normal
Commitments in assets reorganization on horizontal ―Commitment Long-term
China Putian 2020 performance
competition, 4‖
Corporation
related
57
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
transactions
and fund
occupation
Commitments
China on horizontal
See
Potevio; competition, October 13, In normal
―Commitment Long-term
China Putian related 2020 performance
5‖
Corporation transactions
and fund
occupation
China
See
Potevio; Other October 13, In normal
―Commitment Long-term
China Putian commitment 2020 performance
6‖
Corporation
Xu Qian;
Wang Wenkui;
Li Tong; Liu
Yun; Wang
Jinfeng; Qin
Zhen; Tang
See
Fuxin; Xie Other November 25, In normal
―Commitment Long-term
Manlin; Du commitment 2020 performance
7‖
Xiaorong; Jia
Haowen; Lei
Xu; Liu
Xiaodong;
Wang Huailin;
Li Jing
China
See
Potevio; Other November 25, In normal
―Commitment Long-term
China Putian commitment 2020 performance
8‖
Corporation
Commitments make in initial public
offering or re-financing
Equity incentive commitment
Commitments
See
Other commitments for medium and on horizontal In normal
China Potevio ―Commitment April 8, 2018 Long-term
small shareholders competition, performance
9‖
related
transactions
58
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
and fund
occupation
Commitments
on horizontal
See
competition, In normal
China Potevio ―Commitment April 8, 2018 Long-term
related performance
10‖
transactions
and fund
occupation
Commitments
on horizontal
See
competition, In normal
China Potevio ―Commitment April 8, 2018 Long-term
related performance
11‖
transactions
and fund
occupation
Commitments
on horizontal
See
China Putian competition, In normal
―Commitment April 8, 2018 Long-term
Corporation related performance
12‖
transactions
and fund
occupation
Commitments
on horizontal
See
China Putian competition, In normal
―Commitment April 8, 2018 Long-term
Corporation related performance
13‖
transactions
and fund
occupation
Commitments
on horizontal
See
China Putian competition, In normal
―Commitment April 8, 2018 Long-term
Corporation related performance
14‖
transactions
and fund
occupation
59
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
See
China Putian Other In normal
―Commitment June 19, 2018 Long-term
Corporation commitment performance
15‖
Completed on time (Y/N) Y
If the commitment is overdue and not
fully fulfilled, it shall explain the
specific reasons for the incomplete Not applicable
performance and the work plan for the
next step
2. Specific commitments
Commitment 1:
Committed party: China Electronics Technology Group Corporation
Content of commitments:
After being studied by the State-owned Assets Supervision and Administration Commission of the State Council and approved by the
State Council, China Potevio Information Industry Group Co., Ltd. (hereinafter referred to as ―China Potevio‖) shall be transferred to
China Electronics Technology Group Co., Ltd. (hereinafter referred to as ―the Company‖) for free as a whole and become a
wholly-owned subsidiary of the Company (hereinafter referred to as ―this reorganization‖). This reorganization will result in the
Company becoming the indirect controlling shareholder of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as
―the listed Company‖), a listed Company affiliated to China Potevio. As the acquirer of the listed Company, in order to ensure the
independence of the listed Company in terms of assets, personnel, finance, business and organization, the Company hereby makes the
following commitments:
1. Personnel independence
(1) To guarantee that the general manager, deputy general manager, financial controller and secretary of the boardof the listed
Company and other senior executives shallneither serve as administrative posts other than directors and supervisorsin the Company
and other enterprises and institutions controlled by the Company (hereinafter referred to as ―subsidiary enterprises and institutions‖),
nor receive salaries from the Company and the subsidiary enterprises and institutions of the Company.
(2) The financial personnel of the listed Companyshall not take part-time jobs in the Company and the subsidiary enterprises and
institutions of the Company.
2. Financial independence
(1) To guarantee that the listed Company sets an independent financial accounting department and has an independent financial
accounting system and financial management system, and independently makes financial decisions.
(2) To guarantee that the listed Company maintains independence in financial decision-making, the Company and the Company’s
subsidiary enterprises and institutions shall not get involved in the fund use of the listed Company.
(3) To guarantee that the listed Companyshall independently open bank accountsfor settlement of income and expenditure, and
independently declare tax and fulfill tax obligations in accordance with the law.
3. Institutional independence
(1) To guarantee that the listed Company and its their subsidiaries establish and improve corporate governance structurein
accordance with the law, and can operate independently; guaranteethat the office and site for business operation of the
listedCompany are separated from the Company andthe subsidiary enterprises and institutions of the Company.
(2) To guarantee that the listed Company and its subsidiaries operate independently, there is no affiliation with functional
departments of the Company.
60
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
4. Asset independence
(1) To guaranteethat the listed Company has independent and complete assets.
(2) To guarantee that the Company andthe subsidiary enterprises and institutions of the Company shall not illegally occupy assets,
funds and other resources of the listedCompany.
5. Business independence
(1) To guarantee that the listed Company shall have independent business, and carry out business activities independently.
(2) To guarantee that the listed Company shall contracts and carry out businessindependently, form an independent and complete
business system, implement independent accounting for operation and management, independently assume responsibility and risk,
and have the ability for independent and sustainable operationin the market.
This commitment shall continue to be effective during the period when the Company has control over the listed Company. If the
Company fails to fulfill the above commitment and causes losses to the listed Company, the Company shall bear the corresponding
compensation liabilities.
Commitment 2:
Committed party: China Electronics Technology Group Corporation
Content of commitments:
After being studied by the State-owned Assets Supervision and Administration Commission of the State Council and approved by the
State Council,China Potevio Information Industry Group Co., Ltd. (hereinafter referred to as ―China Potevio‖) shall be transferred to
China Electronics Technology Group Co., Ltd. (hereinafter referred to as ―the Company‖) for free as a whole and become
awholly-owned subsidiary of the Company (hereinafter referred to as ―this reorganization‖). This reorganization will result in the
Company becoming the indirect controlling shareholder of Nanjing PutianTelecommunications Co., Ltd. (hereinafter referred to as
―the listed Company‖), a listed Company affiliated to China Potevio.As the acquirer of the listed Company, in order to avoid
competition in the same industry and to protect the interests of public shareholders, we hereby makes the following commitments:
From the date of issuance of this letter, the Companyshall further investigate whether there is any business in competition with the
listed Company. If there is business competition in the same industry, the Company will strengthen internal coordination and control
management to ensure the healthy and sustainable development of the listed Company, there will be no harm to the interests of the
listed Company and its public investors; if there is no business competition in the same industry, the Company will strictly abide by
the relevant rules formulated by the China Securities Regulatory Commission and the stock exchange and the articles of association
of the listed Company and other relevant provisionsduring the period when the Company directly or indirectly maintains a substantial
equity control relationship with the listed Company, and shall not use its controlling position in the listed Company to engage in
horizontal competition that damages the legitimate rights and interests of the listed Company and its minority shareholders.
The above commitments will take effect from the date of issuance of the letter of commitment, and will continue to be effective as
long as the listed Company legally and effectively exists and the Company acts as the actual controller of the listed Company.
Commitment 3:
Committed party: China Electronics Technology Group Corporation
Content of commitments:
After being studied by the State-owned Assets Supervision and Administration Commission of the State Council and approved by the
State Council, China Potevio Information Industry Group Co., Ltd. (hereinafter referred to as ―China Potevio‖) shall be transferred to
China Electronics Technology Group Co., Ltd. (hereinafter referred to as ―the Company‖) for free as a whole and become a
wholly-owned subsidiary of the Company (hereinafter referred to as ―this reorganization‖). This reorganization will result in the
Company becoming the indirect controlling shareholder of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as
61
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
―the listed Company‖), a listed Company affiliated to China Potevio. As the acquirer of the listed Company, in order to ensure the
legitimate rights and interest of the listed company and its small & medium shareholders, we make the follow commitments to
regulate the related transaction with listed company:
1. The Company and the subsidiaries controlled by the Company will try to avoid or reduce unnecessary related transactions with the
listed Company and its subsidiaries; related business dealings or transactions that occur due to unavoidable or reasonable reasonswill
be carried out on an equal and voluntary basis in accordance with the principles of fairness, justice and openness, and the transaction
price will be reasonably determined in accordance with the principles of marketization. For related transactions where it is difficult to
compare market prices or whose pricing is restricted, the relevant cost and profit standards should be definedin the contracts, and
decision-making procedures should be performed in accordance with relevant laws and regulations, normative documents and the
Articles of Association of the listed Company,it shall be guaranteed that the legitimate rights and interests of the listed Company and
other shareholders are not damaged through related transactions, and the information disclosure obligations are fulfilled according to
relevant provisions at the same time.
2. Any agreements and arrangements made by the Company and its controlled subsidiaries with the listed Company on mutual
related affairs and related transactions shall not prevent the other party from conducting business dealings or transactions with any
third party for its own interests and under the same market competition conditions.
This letter of commitment will continue to be effective as long as the listed Company legally and effectively exists and the Company
acts as the actual controller of the listed Company.If the listed Company suffers losses due to the Company’s violation of the
commitments under this letter of commitment, the Company will be liable for compensation according to law.
Commitment 4:
Committed party: China Potevio; China Putian Corporation
Content of commitments:
1. The Company or the companies controlled by the Company will try to minimize the related transactions with Nanjing Putian
Telecommunications Co., Ltd. (hereinafter referred to as "Nanjing Putian") and its subsidiaries and branches.
2. Related transactions that cannot be avoided or exist with reasonable grounds will be conducted on an equal and voluntary basis and
in accordance with the principles of fairness, justice, and compensation of equal value. The Company or the companies controlled by
the Company will sign standardized related transaction agreements with Nanjing Putian or its subsidiaries in accordance with the law,
and the transaction prices will be determined at a reasonable price recognized in the market to ensure that the related transaction price
is fair; and perform fair procedures such as related transaction decision-making, vote avoidance, and disclose information in a timely
manner in accordance with relevant laws, rules, regulations, other normative documents and the articles of association of Nanjing
Putian or its subsidiaries, so as to ensure that the legitimate rights and interests of Nanjing Putian or its subsidiaries and other
shareholders of Nanjing Putian will not be harmed through related transactions. .
3. It is guaranteed that it will not require or accept Nanjing Putian or its subsidiaries or branches in any fair market transaction to
provide The Company or the companies controlled by the Company with better conditions than third parties.
4. It is guaranteed that it will exercise corresponding rights and assume corresponding obligations in accordance with the articles of
association of Nanjing Putian and its subsidiaries, and will not use the identity of the controlling shareholder/actual controller to seek
illegitimate interests, or use related transactions to illegally transfer funds and profits of Nanjing Putian or its subsidiaries, and
guarantee not to damage the legitimate rights and interests of other shareholders of Nanjing Putian.
5. If The Company violates the above commitments, it will be willing to assume all the responsibilities arising therefrom, and fully
compensate for all direct or indirect losses caused to Nanjing Putian.
62
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Commitment 5:
Committed party: China Potevio; China Putian Corporation
Content of commitments:
1. During the period when The Company directly or indirectly holds shares of Nanjing Putian Telecommunications Co., Ltd.
(hereinafter referred to as "Nanjing Putian"), it guarantees that it will not use its control relationship over Nanjing Putian to engage in
or participate in activities that harm the interests of Nanjing Putian and its small and medium shareholders.
2. In addition to the above disclosures, in the future, The Company and other companies controlled by the Company will not directly
or indirectly own, manage, control, invest, or engage in any other businesses or projects that are the same as or similar to those
currently carried out or planned in the future by Nanjing Putian and its subsidiaries and branches at home and abroad, nor participate
in the ownership, management, control, or investment of any businesses or projects that are the same as or similar to those currently
carried out or planned in the future by Nanjing Putian and its subsidiaries and branches, nor seek to directly or indirectly engage in
any businesses constitute competition to the businesses currently carried out or planned in the future by Nanjing Putian and its
subsidiaries and branches through joint ventures, cooperation, joint operations with any third party, or lease operations, contract
operations, entrusted management, etc., nor have interests in the above activities. If The Company and other companies controlled by
the Company discover any new business opportunities that constitute or may constitute a direct or indirect competitive relationship
with Nanjing Putian or its holding company’s main business, it will immediately notify Nanjing Putian in writing and urge the
business opportunity to be first provided to Nanjing Putian or its holding company on reasonable and fair terms and conditions.
3. If Nanjing Putian or its holding companies abandon such competitive new business opportunities and The Company and other
companies controlled by the Company engage in such competitive business, Nanjing Putian or its holding companies will have the
right to acquire any equity, assets and other rights and interests in the above-mentioned competitive business from the
above-mentioned entities at any time at one time or in multiples.
4.When The Company and other companies controlled by the Company intend to transfer, sell, lease, license or otherwise transfer or
allow the use of assets and businesses that constitute or may constitute a direct or indirect competitive relationship with the main
business of Nanjing Putian or its holding companies, The Company and other companies controlled by the Company will provide
Nanjing Putian or its holding companies with the right of first refusal, and promise to do its utmost to urge The Company’s
shareholding companies to provide Nanjing Putian or its holding company with the right of first refusal under the above-mentioned
circumstances.
5. If The Company violates the above commitments, it shall make a total, timely and full compensation for the losses suffered by
Nanjing Putian; all the benefits obtained by the Company due to the violation of the above commitments shall be attributed to
Nanjing Putian.
6. The above commitments will continue to be valid during the period when The Company is the controlling shareholder/actual
controller of the listed company.
Commitment 6:
Committed party: China Potevio; China Putian Corporation
After the completion of this transaction, The Company will strictly abide by the "Company Law", "Securities Law", and relevant
regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange and the articles of association to
ensure that Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as the "listed company") ") shall continue to be
63
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
completely separated from The Company and other companies that The Company controls or exerts significant influence in terms of
personnel, assets, finance, organization and business, and maintain the independence of the listed company in terms of personnel,
assets, finance, organization and business. In particular, after the completion of this transaction, The Company will comply with the
regulations of the "Notice on Regulating Fund Transactions between Listed Companies and Related Parties and Issues Concerning
the External Guarantees of Listed Companies" (ZJF (2003) No. 56) and the "Notice of China Securities Regulatory Commission and
China Banking Regulatory Commission on Regulating the External Guarantee Behavior of Listed Companies (ZJF [2005] No. 120),
standardize the external guarantee behavior of the listed company and its subsidiaries, and do not illegally occupy the funds of the
listed company and its subsidiaries.
The Company guarantees to strictly fulfill the above-mentioned commitments. In the event that The Company or other companies
that The Company controls or exerts significant influence violate the above-mentioned commitments and cause damage to the rights
and interests of the listed company, The Company will bear the corresponding compensation liabilities in accordance with the law.
Commitment 7:
Committed party: Xu Qian; Wang Wenkui; Li Tong; Liu Yun; Wang Jinfeng; Qin Zhen; Tang Fuxin; Xie Manlin; Du Xiaorong; Jia
Haowen; Lei Xu; Liu Xiaodong; Wang Huailin; Li Jing
Content of commitments:
In order to ensure that The Company's measures to fill the diluted immediate returns can be effectively implemented, all directors and
senior managers of the Company have made the following commitments:
(i) I promise not to convey benefits to other units or individuals without compensation or on unfair terms, nor to harm the interests of
the listed company by other means;
(ii) I promise to restrain my position-related consumption behavior;
(iii) I promise not to use the assets of the listed company to engage in investment and consumption activities that have nothing to do
with the performance of my duties;
(iv) I promise to make every effort to urge the remuneration system formulated by the board of directors or the remuneration
committee to be linked to the implementation of the listed company's compensation measures within the scope of my own duties and
powers;
(v) If the listed company plans to implement equity incentives in the future, I promise to make every effort to urge the listed
company's planned equity incentive vesting conditions to be linked to the implementation of the compensation measures within the
scope of my own duties and powers;
(vi) From the time when this commitment is issued to the time before the completion of the transaction, if the China Securities
Regulatory Commission makes other new regulatory requirements on the replenishment measures and its commitments, and the
above commitments cannot meet the requirements of the China Securities Regulatory Commission, I promise that the supplementary
commitments will be issued in accordance with the latest regulations of the China Securities Regulatory Commission;
(vii) I promise to fulfill the relevant fill-up and return measures formulated by the listed company and any promises made by me
regarding the fill-up and return measures. If I violate these promises and cause losses to the listed company or investors, I am willing
to bear the liability of indemnity in accordance with the law to the listed company or investors.
Commitment 8:
Committed party: China Potevio; China Putian Corporation
Content of commitments:
1. The Company promises not to exceed its authority to interfere with the operation and management activities of Nanjing Putian
64
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Telecommunications Co., Ltd. (hereinafter referred to as "Nanjing Putian"), nor infringe on the interests of Nanjing Putian;
2. From the issuance date of this commitment to the time before the completion of the transaction, if the China Securities Regulatory
Commission makes clear provisions on the fill-up and return measures and its commitments, and the above commitments cannot
meet the requirements of the China Securities Regulatory Commission, The Company promises to issue a supplementary
commitment in accordance with the regulations of the China Securities Regulatory Commission;
The Company promises to strictly perform the above-mentioned commitments made by it to ensure that the measures for fill-up and
return can be effectively implemented. If The Company violates the above commitments and causes losses to Nanjing Putian or
investors, The Company is willing to bear the compensation responsibilities for Nanjing Putian or investors and the corresponding
penalties imposed by the regulatory authorities in accordance with the law.
Commitment 9:
Committed party: China Potevio
Content of commitments: In view of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as ―Nanjing Putian‖)
intended to apply for resumption of listing to the Shenzhen Stock Exchange, The Company, as a controlling shareholder of Nanjing
Putian, made the following commitments:
I. Ensure the personnel independence of Nanjing Putian
(i) Ensure that the production and management and public administration (including labour, personnel and wage management, etc.)
of Nanjing Putian are completely independent of the Company and other subordinate companies and enterprises of the Company.
(ii) Ensure that the general manager, deputy general manager, chief financial officer, secretary of the board and other senior
management staff of Nanjing Putian work full time in Nanjing Putian and get remuneration from Nanjing Putian, and don’t take part
time jobs in other positions other than directors and supervisors in The Company or other companies and enterprises of the Company,
nor get remuneration from The Company or other companies and enterprises of the Company, and ensure that thefinancial staff of
Nanjing Putian don’t take part time jobs or get remuneration from The Company or other companies and enterprises of the Company.
(iii) Ensure that the candidates recommended by the Company to take up the posts of directors, supervisors and senior management
in Nanjing Putian are checked by legal procedures, The Company does not interfere with the personnel appointment and dismissal
decision made by the board of directors and the general meeting of shareholders of Nanjing Putian.
II. Ensure the assets independence and integrity of Nanjing Putian
(i) Ensure the independence and integrity of the assets of Nanjing Putian and its subsidiaries, and all of these assets are under the
control of Nanjing Putian and its subsidiaries, and are independently owned and operated by Nanjing Putian and its subsidiaries.
(ii) Ensure that The Company and the subordinate companies and enterprises of the Company do not illegally occupy the assets,
funds and other resources of Nanjing Putian.
III. Ensure the business independence of Nanjing Putian
(i) Ensure that Nanjing Putian has independent procurement and sales systems, and has the assets, personnel, qualifications to carry
out independent business activities and the ability to operate independently in the market.
(ii) Ensure that The Company and other companies and enterprises affiliated to the Company avoid horizontal competition with
Nanjing Putian and its subsidiaries.
(iii) Ensure strict control of related transactions, and minimize the continuous related transactions between Nanjing Putian and its
subsidiaries with The Company and other companies and enterprises under The Company. Eliminate the illegal occupation of funds
and assets of Nanjing Putian, and don’t require Nanjing Putian and its subsidiaries to provide any form of guarantee to the Company
and other companies and enterprises affiliated to the Company. For the unavoidable related transactions, insist on the principle of
65
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
―fairness, justice and openness‖, andkeep the transaction prices same as the non-related enterprises, and carry out the information
disclosure in a timely manner.
(iv) Ensure not to interfere with the major decision-making matters of Nanjing Putian in any way other than the exercise of
shareholders’ rights in accordance with the law through a separate or concerted action, nor affect the independence of Nanjing
Putian’s assets, personnel, finance, organization and business.
IV. Ensure the institution independence of Nanjing Putian
(i) Ensure that Nanjing Putian and its subsidiaries establish and improve the corporate governance structure according to law, and
completely separate from The Company and other companies and enterprises under The Company; ensure that the office facilities
and production and operation sites of Nanjing Putian and its subsidiaries are completely separated from The Company and other
companies and enterprises affiliated to the Company, and there is no situation in which institutions are mixed.
(ii) Ensure that Nanjing Putian and its subsidiaries operate independently, and The Company will not directly or indirectly interfere
with the decision-making and operation of Nanjing Putian by surpassing the board of directors and shareholders’ meeting of Nanjing
Putian.
(iii) Ensure that the shareholders’ meeting, board of directors, independent directors, board of supervisors, and senior management
personnel of Nanjing Putian independently exercise their official powers in accordance with laws, regulations, and articles of
association.
V. Ensure the financial independence of Nanjing Putian
(i) Ensure that Nanjing Putian sets up an independent financial accounting department and has an independent financial accounting
system, and has a standardized and independent financial accounting system and financial management system.
(ii) Ensure that Nanjing Putian maintains independence in financial decision-making, The Company and other companies and
enterprises affiliated to the Company do not interfere with the use and dispatch of funds by Nanjing Putian.
(iii) Ensure that Nanjing Putian maintains its own independent bank account and does not share a bank account with The Company
and other companies and enterprises under The Company.
(iv) Ensure that Nanjing Putian shall pay taxes independently according to law.
The above commitments are valid and cannot be changed or revoked while The Company is a shareholder of Nanjing Putian. If the
above commitments are violated and economic losses are caused to Nanjing Putian, The Company will compensate Nanjing Putian
Commitment 10:
Committed party: China Potevio
Content of commitments:
In view of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as ―Nanjing Putian‖) intended to apply for
resumption of listing to the Shenzhen Stock Exchange, The Company, as a controlling shareholder of Nanjing Putian, made the
following commitments:
I. Do not influence and require Nanjing Putian and its subsidiaries to give rights superior to the third parties in the market in business
cooperation, nor engage in any acts to damage the interests of Nanjing Putian and its subsidiaries by using its controlling shareholder
status at Nanjing Putian.
II. Do not influence and require preferential rights to make deals with Nanjing Putian and its subsidiaries by using its controlling
shareholder status at Nanjing Putian.
III. When conducting necessary and inevitable related transactions, guarantee to conduct according to the principle of marketization
and fair price, and perform the transaction procedures and information disclosure obligations in strict accordance with the relevant
laws, regulations, regulatory documents and the relevant provisions of the articles of association of listed companies, and guarantee
66
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
not to damage the legitimate rights and interests of Nanjing Putian and other shareholders through related transactions.
The above commitments are valid and cannot be changed or revoked while The Company is a shareholder of Nanjing Putian. If the
above commitments are violated and economic losses are caused to Nanjing Putian, The Company will compensate Nanjing Putian.
Commitment 11:
Committed party: China Potevio
Content of commitments: In view of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as ―Nanjing Putian‖)
intended to apply for resumption of listing to the Shenzhen Stock Exchange, The Company, as a controlling shareholder of Nanjing
Putian, made the following commitments:
I. The Company and other related enterprise controlled by the Company have not engaged in any production and business operations
or activities that directly or indirectly compete with Nanjing Putian; and guarantee that they will not engage in any production and
business operations or activities that directly or indirectly compete with Nanjing Putian in the future.
II. The Company does not own, manage, control, invest or engage in any business or project that is the same or similar to the
business of Nanjing Putian.
III. If The Company or any related enterprise obtains any business opportunity from any third party that has substantial competition
with the business of Nanjing Putian or may have substantial competition in the future, The Company will immediately notify Nanjing
Putian, and transfers the business opportunity to Nanjing Putian after obtaining the promise from the third party.
IV. The Company will supervise and restrict the production and operation activities of itself and other related enterprises. If The
Company and other related enterprises have products or business the same or similar to those of Nanjing Putian, The Company
promises to take the following measures to resolve:
(i) When Nanjing Putian considers it necessary, The Company and other related enterprises will reduce the holdings until all the
relevant assets and businesses held by the Company and related enterprises are transferred;
(ii) When Nanjing Putian considers it necessary, the relevant assets and businesses held by the Company and other related enterprises
may be preferentially acquired through appropriate means;
(iii) If The Company and related enterprises have conflicts of interest with Nanjing Putian due to horizontal competition, give priority
to the interests of Nanjing Putian;
(iv) Other measures that help avoid horizontal competition.
The above commitments are valid and cannot be changed or revoked while The Company is a shareholder of Nanjing Putian. If the
above commitments are violated and the economic losses are caused to Nanjing Putian, The Company will compensate Nanjing
Putian.
Commitment 12:
Committed party: China Putian Corporation
Content of commitments: In view of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as ―Nanjing Putian‖)
intended to apply for resumption of listing to the Shenzhen Stock Exchange, The Company, as an actual controller of Nanjing Putian,
made the following commitments:
I. Ensure the personnel independence of Nanjing Putian
(i) Ensure that the production and management and public administration (including labour, personnel and wage management, etc.)
of Nanjing Putian are completely independent of the Company and other subordinate companies and enterprises of the Company.
(ii) Ensure that the general manager, deputy general manager, chief financial officer, secretary of the board and other senior
management staff of Nanjing Putian work full time in Nanjing Putian and get remuneration from Nanjing Putian, and don’t take part
time jobs in other positions other than directors and supervisors in The Company or other companies and enterprises of the Company,
67
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
nor get remuneration from The Company or other companies and enterprises of the Company, and ensure that the financial staff of
Nanjing Putian don’t take part time jobs or get remuneration from The Company or other companies and enterprises of the Company.
(iii) Ensure that the candidates recommended by the Company to take up the posts of directors, supervisors and senior management
in Nanjing Putian are checked by legal procedures, The Company does not interfere with the personnel appointment and dismissal
decision made by the board of directors and the general meeting of shareholders of Nanjing Putian.
II. Ensure the assets independence and integrity of Nanjing Putian
(i) Ensure the independence and integrity of the assets of Nanjing Putian and its subsidiaries, and all of these assets are under the
control of Nanjing Putian and its subsidiaries, and are independently owned and operated by Nanjing Putian and its subsidiaries.
(ii) Ensure that The Company and the subordinate companies and enterprises of the Company do not illegally occupy the assets,
funds and other resources of Nanjing Putian.
III. Ensure the business independence of Nanjing Putian.
(i) Ensure that Nanjing Putian has independent procurement and sales systems, and has the assets, personnel, qualifications to carry
out independent business activities and the ability to operate independently in the market.
(ii) Ensure that The Company and other companies and enterprises affiliated to the Company avoid horizontal competition with
Nanjing Putian and its subsidiaries.
(iii) Ensure strict control of related transactions, and minimize the continuous related transactions between Nanjing Putian and its
subsidiaries with The Company and other companies and enterprises under The Company. Eliminate the illegal occupation of funds
and assets of Nanjing Putian, and don’t require Nanjing Putian and its subsidiaries to provide any form of guarantee to the Company
and other companies and enterprises affiliated to the Company. For the unavoidable related transactions, insist on the principle of
―fairness, justice and openness‖, and keep the transaction prices same as the non-related enterprises, and carry out the information
disclosure in a timely manner.
(iv) Ensure not to interfere with the major decision-making matters of Nanjing Putian in any way other than the exercise of
shareholders’ rights in accordance with the law through a separate or concerted action, nor affect the independence of Nanjing
Putian’s assets, personnel, finance, organization and business.
IV. Ensure the institution independence of Nanjing Putian.
(i) Ensure that Nanjing Putian and its subsidiaries establish and improve the corporate governance structure according to law, and
completely separate from The Company and other companies and enterprises under The Company; ensure that the office facilities
and production and operation sites of Nanjing Putian and its subsidiaries are completely separated from The Company and other
companies and enterprises affiliated to the Company, and there is no situation in which institutions are mixed.
(ii) Ensure that Nanjing Putian and its subsidiaries operate independently, and The Company will not directly or indirectly interfere
with the decision-making and operation of Nanjing Putian by surpassing the board of directors and shareholders’ meeting of Nanjing
Putian.
(iii) Ensure that the shareholders’ meeting, board of directors, independent directors, board of supervisors, and senior management
personnel of Nanjing Putian independently exercise their official powers in accordance with laws, regulations, and articles of
association.
V. Ensure the financial independence of Nanjing Putian
(i) Ensure that Nanjing Putian sets up an independent financial accounting department and has an independent financial accounting
system, and has a standardized and independent financial accounting system and financial management system.
(ii) Ensure that Nanjing Putian maintains independence in financial decision-making, The Company and other companies and
enterprises affiliated to the Company do not interfere with the use and dispatch of funds by Nanjing Putian.
68
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(iii) Ensure that Nanjing Putian maintains its own independent bank account and does not share a bank account with The Company
and other companies and enterprises under The Company.
(iv) Ensure that Nanjing Putian shall pay taxes independently according to law.
The above commitments are valid and cannot be changed or revoked while The Company is a shareholder of Nanjing Putian. If the
above commitments are violated and economic losses are caused to Nanjing Putian, The Company will compensate Nanjing Putian.
Commitment 13:
Committed party: China Putian Corporation
Content of commitments:
In view of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as ―Nanjing Putian‖) intended to apply for
resumption of listing to the Shenzhen Stock Exchange, The Company, as a actual controller of Nanjing Putian, made the following
commitments:
1.Do not influence and require Nanjing Putian and its subsidiaries to give rights superior to the third parties in the market in business
cooperation, nor engage in any acts to damage the interests of Nanjing Putian and its subsidiaries by using its actual controller status
at Nanjing Putian;
2. Do not influence and require preferential rights to make deals with Nanjing Putian and its subsidiaries by using its actual controller
status at Nanjing Putian;
3. When conducting necessary and inevitable related transactions, guarantee to conduct according to the principle of marketization
and fair price, and perform the transaction procedures and information disclosure obligations in strict accordance with the relevant
laws, regulations, regulatory documents and the relevant provisions of the articles of association of listed companies, and guarantee
not to damage the legitimate rights and interests of Nanjing Putian and other shareholders through related transactions.
The above commitments are valid and cannot be changed or revoked while The Company is a actual controller of Nanjing Putian. If
the above commitments are violated and economic losses are caused to Nanjing Putian, The Company will compensate Nanjing
Putian.
Commitment 14:
Committed party: China Putian Corporation
Content of commitments: In view of Nanjing Putian Telecommunications Co., Ltd. (hereinafter referred to as ―Nanjing Putian‖)
intended to apply for resumption of listing to the Shenzhen Stock Exchange, The Company, as a actual controller of Nanjing Putian,
made the following commitments:
1. The Company and other related enterprise controlled by the Company have not engaged in any production and business operations
or activities that directly or indirectly compete with Nanjing Putian; and guarantee that they will not engage in any production and
business operations or activities that directly or indirectly compete with Nanjing Putian in the future.
2. The Company does not own, manage, control, invest or engage in any business or project that is the same or similar to the business
of Nanjing Putian.
3. If The Company or any related enterprise obtains any business opportunity from any third party that has substantial competition
with the business of Nanjing Putian or may have substantial competition in the future, The Company will immediately notify Nanjing
Putian, and transfers the business opportunity to Nanjing Putian after obtaining the promise from the third party.
4. The Company will supervise and restrict the production and operation activities of itself and other related enterprises. If The
Company and other related enterprises have products or business the same or similar to those of Nanjing Putian, The Company
promises to take the following measures to resolve:
(1) When Nanjing Putian considers it necessary, The Company and other related enterprises will reduce the holdings until all the
69
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
relevant assets and businesses held by the Company and related enterprises are transferred;
(2) When Nanjing Putian considers it necessary, the relevant assets and businesses held by the Company and other related enterprises
may be preferentially acquired through appropriate means;
(3) If The Company and related enterprises have conflicts of interest with Nanjing Putian due to horizontal competition, give priority
to the interests of Nanjing Putian;
(4) Other measures that help avoid horizontal competition.
The above commitments are valid and cannot be changed or revoked while The Company is a shareholder of Nanjing Putian. If the
above commitments are violated and the economic losses are caused to Nanjing Putian, The Company will compensate Nanjing
Putian.
Commitment 15:
Committed party: China Putian Corporation
Content of commitments: The Group makes statements and commitments regarding the business condition and future development
planning of the private network communications business of Nanjing Putian, and the operations of the Group and other enterprises
controlled by the Group (other than Nanjing Putian and its controlled enterprises) as follows:
In order to optimize the internal resources allocation of the group, make full use of the business capability of Nanjing Putian, starting
from 2016, the Group will convert the private network communication products originally purchased by China Potevio (hereinafter
referred to as ―Potevio‖), a wholly-owned subsidiary of the Group, into commissioning Nanjing Putian for production. The Group’s
private network communication business which was originally a trade-oriented business and was purchased by Potevio from external
suppliers to sell has successfully transformed into an independent processing and production business in 2016, and the current
business model is that Potevio obtains orders from customers, and then signs entrusted production contracts with Nanjing Putian and
its subsidiary Nanfang branch, and Nanjing Putian is responsible for the specific production. At present, the customer of Potevio is
Fushen Industrial Co., Ltd., and the annual order amount of the existing model products remains above 500 million Yuan, and it is
predicted that there will be a stable demand period of 3 to 5 years.
The Group promises to take Nanjing Putian as the business entity of the private network communication services, including but not
limited to:
1. Nanjing Putian is the military-civilian integration industrial base of the Group, and is the only production entity of the existing
product multi-mesh cloud data processing communication equipment and related military-civilian integration project (i.e. the private
network communication service signified in this commitment), which is exclusive;
2. The Group promises to gradually integrate the complete business processes and related resources of the private network
communication business, including the sales link, into Nanjing Putian within three years; if relevant business resources cannot be
integrated into Nanjing Putian due to external factors, for example, downstream customers have special requirements for the direct
partner’s subject qualification (for example, must be non-foreign-invested enterprises), the Group will cooperate with Nanjing Putian
to carry out related business in accordance with the requirements of relevant laws and regulations, that is, to undertake related
business in the name of the Group or its subsidiaries, and Nanjing Putian is responsible for the actual operation.
The above commitments shall take effect on the date of signing this commitment, and shall remain in force and irrevocable during
the period of existence of Nanjing Putian and during the period that the Group is deemed to be a related person whom is not allowed
to engage in the same or similar business with the private network communication business of Nanjing Putian in accordance with
relevant regulations. If the above commitment proved to be untrue or not complied with, all the benefits obtained by the Group in
violation of the commitment shall be owned by Nanjing Putian, and the Group will compensate Nanjing Putian for all direct and
indirect losses and bear corresponding legal liabilities.
70
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
3. Concerning assets or project of the Company, which has profit forecast, and reporting period still in
forecasting period, explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
II. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
III. External guarantee out of the regulations
□ Applicable √ Not applicable
No external guarantee out of the regulations occurred in the period.
IV. Statement on the latest “modified audit report” by BOD
□ Applicable √ Not applicable
V. Explanation from BOD, BOS and Independent Directors (if applicable) for “Modified
Audit Report” that issued by CPA
□ Applicable √ Not applicable
VI. Explanation of the changes in accounting polices, accounting estimates or correction of
significant accounting errors compared with the financial report of the previous year
√ Applicable □ Not applicable
According to relevant requirement of the Decision on Taking Corrective Regulatory Measures Against Nanjing Putian
Telecommunications Co., Ltd (Administrative Supervisory Measures Decision Letter of Jiangsu Securities Regulatory Bureau [2022]
No.10), and after deliberated and approved by 58th session of 7th BOD held on April 22, 2022, The Company adopted retrospective
restatement method to correct the accounting errors for the periodic reports of 2017, 2018 and 2019. For the impact with annual
operation results and financial status concerned, found more in the Notice on Correction of Prior Period Accounting Errors released
by the Company dated April 26, 2022 and ―15(1).Correction of Prior Period Accounting Errors‖ carried in Section X. of the Annual
Report.
VII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
□ Applicable √ Not applicable
No changes in consolidation statement’s scope of the Company in Period.
71
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
VIII. Appointment and non-reappointment (dismissal) of CPA
Accounting firm appointed
Name of domestic accounting firm Pan-China Certified Public Accountants (LLP)
Remuneration for domestic accounting firm (in 10 thousand
82
Yuan)
Continuous life of auditing service for domestic accounting firm 8
Name of domestic CPA He Jiangxing, Zhang Jinghui
Continuous service years from domestic CPA 1year, 3 years
Re-appointed accounting firms in this period
□ Yes √ No
Appointment of internal control auditing accounting firm, financial consultant or sponsor
√ Applicable □ Not applicable
Pan-China Certified Public Accountants (LLP) was engaged as audit institute of internal control for the Company of 2021, auditing
fee for internal control was 0.28 million Yuan.
IX. Particular about delisting after annual report disclosed
□ Applicable √ Not applicable
X. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization for the Companyduring the reporting period
XI. Significant litigation and arbitration of the Company
√ Applicable □ Not applicable
Amount Outcome and
Whether a
Litigation(arbitratio involved (10 impact of Judgment Disclosure Disclosure
accrual liability Progress
n) thousand litigation enforcement date index
resulted (Y/N)
Yuan) (arbitration)
1. No single
significant litigation
during the reporting
period. Cumulative
litigation meeting
the disclosure
standards are as:
Case of sale and Court No significant Execution October 29, Juchao
59.22 No
purchase contract Mediation impact on the completed 2021 website
72
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
dispute- Zhejiang current profit or ―Notice on
Post and profit after the Cumulative
Telecommunications period Litigation‖ of
Engineering the Company
Construction Co.,
Ltd. bring a suit
against Nanjing
Putian
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
Juchao
dispute- Nanjing No significant
website
Hengshidan Electric impact on the
Settlement October 29, ―Notice on
Equipment Co., Ltd. 110.92 No current profit or -
withdrawal 2021 Cumulative
bring a suit against profit after the
Litigation‖ of
Nanjing Putian period
the Company
Telecommunications
Co., Ltd.
Case of construction
contract dispute -
Zhejiang Post and
Juchao
Telecommunications No significant
website
Engineering impact on the
Court Execution October 29, ―Notice on
Construction Co., 50.23 No current profit or
Mediation completed 2021 Cumulative
Ltd. bring a suit profit after the
Litigation‖ of
against Nanjing period
the Company
Putian
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
dispute- Nanjing Juchao
No significant
Hikvision Digital website
impact on the
Technology Co., Settlement October 29, ―Notice on
7.95 No current profit or -
Ltd. bring a suit withdrawal 2021 Cumulative
profit after the
against Nanjing Litigation‖ of
period
Putian the Company
Telecommunications
Co., Ltd.
Case of sale and No significant Juchao
Court Execution October 29,
purchase contract 30 No impact on the website
Mediation completed 2021
dispute- Nanjing current profit or ―Notice on
73
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Yonggao Electric profit after the Cumulative
Co., Ltd. bring a suit period Litigation‖ of
against Nanjing the Company
Putian
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
dispute- Shaanxi Juchao
No significant
Guolian Information website
impact on the
Technology Co., Final October 29, ―Notice on
2.04 No current profit or -
Ltd. bring a suit rejection 2021 Cumulative
profit after the
against Nanjing Litigation‖ of
period
Putian the Company
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
dispute- Nanjing
Putian Juchao
No significant
Communications website
impact on the
Technology Co., Settlement October 29, ―Notice on
306.96 No current profit or -
Ltd. bring a suit withdrawal 2021 Cumulative
profit after the
against Nanjing Litigation‖ of
period
Supply and the Company
Marketing Trade
Development Co.,
Ltd.
Case of sale and
purchase contract
dispute- Xinjiang
Juchao
Tianan Electric
website
Complete
Trial in October 29, ―Notice on
Equipment Co., Ltd. 24.7 No Pending -
progress 2021 Cumulative
bring a suit against
Litigation‖ of
Nanjing Putian
the Company
Communications
Technology Co.,
Ltd.
Case of sale and No significant Juchao
purchase contract impact on the Execution October 29, website
12.56 No Judged
dispute- Shenzhen current profit or completed 2021 ―Notice on
Zhongpeng New profit after the Cumulative
74
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Electric Technology period Litigation‖ of
Co., Ltd. bring a suit the Company
against Nanjing
Putian
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
dispute- Chengdu Juchao
No significant
Qianhong website
impact on the
Communication Pre-litigatio Execution October 29, ―Notice on
21.35 No current profit or
Co., Ltd. bring a suit n mediation completed 2021 Cumulative
profit after the
against Nanjing Litigation‖ of
period
Putian the Company
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
dispute- Chengdu Juchao
No significant
Qianhong website
impact on the
Communication Pre-litigatio Execution October 29, ―Notice on
25.33 No current profit or
Co., Ltd. bring a suit n mediation completed 2021 Cumulative
profit after the
against Nanjing Litigation‖ of
period
Putian the Company
Telecommunications
Co., Ltd.
Case of sale and
purchase contract
dispute- Nanjing Juchao
No significant
Putian website
impact on the
Telecommunications Settlement October 29, ―Notice on
1,238.17 No current profit or -
Co., Ltd. bring a suit withdrawal 2021 Cumulative
profit after the
against Nanjing Litigation‖ of
period
Yuanzun the Company
Electromechanical
Equipment Co., Ltd.
Case of sale and
Juchao
purchase contract No significant
website
dispute- Nanjing impact on the
Court Under October 29, ―Notice on
Putian 497.05 No current profit or
Mediation implementation 2021 Cumulative
Telecommunications profit after the
Litigation‖ of
Co., Ltd. bring a suit period
the Company
against Nanjing
75
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Aierte
Optoelectronics Co.,
Ltd.
Case of sale and
purchase contract
dispute- Nanjing
Juchao
Putian No significant
website
Telecommunications impact on the
Settlement October 29, ―Notice on
Co., Ltd. bring a suit 193.51 No current profit or -
withdrawal 2021 Cumulative
against Nanjing profit after the
Litigation‖ of
Hehao period
the Company
Communication
Technology Co.,
Ltd.
Case of sale and
purchase contract
dispute- Nanjing
Juchao
Putian No significant
website
Telecommunications impact on the
Settlement October 29, ―Notice on
Co., Ltd. bring a suit 686.44 No current profit or -
withdrawal 2021 Cumulative
against Nanjing profit after the
Litigation‖ of
Zhengqian period
the Company
Communication
Technology Co.,
Ltd.
2.Other litigation
that did not meet the
disclosure standards 936.52 No - - - -
during the reporting
period
XII. Penalty and rectification
□ Applicable √ Not applicable
There are no penalty and rectification in the reporting period
XIII. Integrityof the Company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
76
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
XIV. Major related transaction
1. Related transaction with routine operation concerned
√ Applicable □ Not applicable
Approv
Proporti Whethe Market
ed
Trading on in the r to price of
Related Related transacti Means
Related Related Pricing amount amount exceed similar Disclos
transacti transacti Dealing on of Disclos
transactio relations principl (in 10 of the the transacti ure
on on price amount paymen ure date
n parties hip e thousan same approve on index
type content (in 10 ts
d Yuan) transacti d availabl
thousan
on amount e
d Yuan)
Notice
on
Forecas
Purchas t of
e of Daily
Controll
products April Related
China ing Telecom Market Bank
and 37.17 37.17 0.05% 5,000 No 37.17 20, Transac
Potevio sharehol product price transfer
receipt 2021 tion for
der
of 2021
services publish
ed on
Juchao
Website
Other
enterpri
ses Purchas Notice
Potevio
under e of on
Informat
the products Forecas
ion Telecom Market Bank
same and 23.93 23.93 0.03% No 23.93 t of
Technol product price transfer
control receipt Daily
ogy Co.,
of the of April Related
Ltd.
actual services 500 20, Transac
controll 2021 tion for
er 2021
Other Purchas publish
Potevio ed on
enterpri e of
Hi-tech Juchao
ses products Labor Market Bank
Industry 25.81 25.81 0.03% No 25.81
Website
under and fee price transfer
Co.,
the receipt
Ltd.
same of
77
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
control services
of the
actual
controll
er
Other
enterpri
Nanjing
ses Purchas
Potevio
under e of
Honyar
the products
Electric Telecom Market Bank
same and 45.64 45.64 0.06% No 45.64
al product price transfer
control receipt
Technol
of the of
ogy Co.,
actual services
Ltd.
controll
er
Other
enterpri
ses Purchas
Nanjing Notice
under e of
Hikvision on
the products
Digital Telecom Market Bank Increas
same and 1.44 1.44 0.00% No 1.44
Technolo product price transfer e the
control receipt
gy Co., Forecas
of the of
Ltd. t of
actual services
Daily
controll
October Related
er
100 30, Transac
The 23rd Other
2021 tions
Research enterpri
for year
Institute ses Purchas
of
of China under e of
2021pu
Electronic the products
Inspecti Market Bank blished
s same and 2.3 2.3 0.00% No 2.3
on fees price transfer on
Technolo control receipt
Juchao
gy Group of the of
Website
Corporati actual services
on controll
(CETC) er
Selling Notice
Controll
goods April on
China ing Telecom Market Bank
and 51.71 51.71 0.06% 1,000 No 51.71 20, Forecas
Potevio sharehol product price transfer
providin 2021 t of
der
g Daily
78
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
services Related
Transac
tion for
2021
publish
ed on
Juchao
Website
Notice
Other on
enterpri Forecas
ses t of
Potevio Selling
under Daily
Informat goods
the April Related
ion and Telecom Market Bank
same 6.68 6.68 0.01% 500 No 6.68 20, Transac
Technol providin product price transfer
control 2021 tion for
ogy Co., g
of the 2021
Ltd. services
actual publish
controll ed on
er Juchao
Website
Notice
Other on
enterpri Forecas
Beijing ses t of
Selling
Putian under Daily
goods
Desheng the April Related
and Telecom Market Bank
Technolo same 0 0 0.00% 500 No 0 20, Transac
providin product price transfer
gy control 2021 tion for
g
Incubator of the 2021
services
Co., Ltd. actual publish
controll ed on
er Juchao
Website
Other Notice
enterpri on
Selling
ses Forecas
Putian goods
under April t of
Communi and Telecom Market Bank
the 0 0 0.00% 2,000 No 0 20, Daily
cation providin product price transfer
same 2021 Related
Co., Ltd. g
control Transac
services
of the tion for
actual 2021
79
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
controll publish
er ed on
Juchao
Website
Other
Beijing enterpri
Potevio ses
Selling
Taili under
goods
Commu the
and Telecom Market Bank
nication same 0.79 0.79 0.00% No 0.79
providin product price transfer
s control
g
Technol of the
services
ogy Co., actual
Ltd. controll
er
Other
enterpri
ses Notice
Selling
under on
Eastern goods
the Forecas
Commu and Telecom Market Bank
same 129.59 129.59 0.14% No 129.59 t of
nication providin product price transfer
control Daily
s Inc. g
of the April Related
services
actual 1,400 20, Transac
controll 2021 tion for
er 2021
Other publish
enterpri ed on
ses Juchao
Potevio Selling
Website
under
Eastern goods
the
Commu and Telecom Market Bank
same 2.36 2.36 0.00% No 2.36
nication providin product price transfer
control
s g
of the
Co.,Ltd. services
actual
controll
er
Other Selling
Wuhan
enterpri goods
Putian
ses and Telecom Market Bank
New 1.61 1.61 0.00% No 1.61
under providin product price transfer
Energy
the g
Co., Ltd.
same services
80
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
control
of the
actual
controll
er
Other
Chengdu enterpri
Weishiton ses
Selling
g under
goods
Informati the October
and Telecom Market Bank
on same 309.47 309.47 0.34% No 309.47 30,
providin product price transfer
Security control 2021
g
Technolo of the
services
gy Co., actual
Ltd. controll
er
Other Notice
enterpri on
Hebei
ses Increas
Far East Selling
under e the
Commu goods
the Forecas
nication and Telecom Market Bank
same 460.63 460.63 0.50% No 460.63 t of
System providin product price transfer
control Daily
Enginee g
of the Related
ring Co., services 1,700
actual Transac
Ltd
controll tions
er for year
Other of 2021
enterpri publish
Nanjing ses ed on
Selling
Rail under Juchao
goods
Transit the Website
and Telecom Market Bank
System same 132.8 132.8 0.14% No 132.8
providin product price transfer
Engineeri control
g
ng Co., of the
services
Ltd. actual
controll
er
Nanjing Other Selling
Laisi enterpri goods
Telecom Market Bank
Informati ses and 16.28 16.28 0.02% No 16.28
product price transfer
on under providin
Technolo the g
81
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
gy Co., same services
Ltd. control
of the
actual
controll
er
Other
enterpri
ses
Shangha Selling
under
i goods
the
Huaxun and Telecom Market Bank
same 5.93 5.93 0.01% No 5.93
Network providin product price transfer
control
System g
of the
Co., Ltd services
actual
controll
er
Other
enterpri
ses
Selling
under
Sichuang goods
the
Electronic and Telecom Market Bank
same 8.87 8.87 0.01% No 8.87
s Co., providin product price transfer
control
Ltd. g
of the
services
actual
controll
er
Other
enterpri
Zhongk
ses
exin Selling
under
integrate goods
the OEM
d circuit and Market Bank
same processi 7.42 7.42 0.01% No 7.42
Co., providin price transfer
control ng
Ltd. g
of the
Nanjing services
actual
Branch
controll
er
Potevio Other Notice
Rent and April
Hi-tech enterpri Leased Market Bank on
property 83.97 83.97 21.30% 100 No 83.97 20,
Industry ses property price transfer Forecas
fees 2021
Co., under t of
82
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Ltd. the Daily
same Related
control Transac
of the tion for
actual 2021
controll publish
er ed on
Juchao
Website
Nanjing Notice
lop Co., on
Ltd Increas
Other
e the
enterpri
Forecas
ses
t of
under
Daily
the October
Rental Market Bank Related
same Rent 39.52 39.52 14.77% 100 No 39.52 30,
property price transfer Transac
control 2021
tions
of the
for year
actual
of 2021
controll
publish
er
ed on
Juchao
Website
Notice
on
Applica
tion for
March
Controll Entrust
Entruste Borrowi 10,
China ing Market Bank ed
d loan ng 447.75 447.75 54.61% 506.3 No 447.75 2021,
Potevio sharehol price transfer Loans
interest interest May 10,
der from
2021
Control
ling
Shareh
older
1,841.6 13,406.
Total -- -- -- -- -- -- -- --
6 3
Details of major sold-out order sent
Not applicable
back
The actual implementation of Daily Total routing related transactions incurred during the reporting period did not exceed the
Related Transactions that is about to estimated total amount
83
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
occurred in the Period with total
amount estimated by category (if
applicable)
Reason for the great difference
between trade price and market Not applicable
reference price (if applicable)
2. Related transactions by assets acquisition and sold
□ Applicable √ Not applicable
No related party transactions by assets acquisition and sold for the Company in Period.
3. Main related transactions of mutual investment outside
□ Applicable √ Not applicable
No main related transactions of mutual investment outside for the Companyduring the reporting period
4. Contact of related credit and debt
√ Applicable □ Not applicable
Whether The Company had non-operating contact of related credit and debt
□ Yes √ No
The Company had no non-operating contact of related credit and debtduring the reporting period.
5. Contact with the related finance companies
√ Applicable □ Not applicable
Deposit business
Amount for the Period
The total
Maximum
Opening Total deposit amount Ending
daily deposit Deposit interest
Related party Relationship balance (in 10 amount for the withdrawn in Balance (10
limit (in 10 rate range
thousand yuan) Period (10 the Period thousand yuan)
thousand yuan)
thousand yuan) (10 thousand
yuan)
China Other
Electronic enterprises
Technology controlled by 81,732.59 0.3%-1.1% 0 9,512.78 8,797.62 715.16
Finance Co., the actual
Ltd controller
Loan business
Related party Relationship Loan amount Loan interest Opening Amount for the Period Ending
84
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(in 10 thousand rate range balance (in 10 The total Balance (10
yuan) thousand yuan) Total deposit amount thousand yuan)
amount for the withdrawn in
Period (10 the Period
thousand yuan) (10 thousand
yuan)
Credit extension or other financial business
Total amount ( 10 Actual amount ( 10
Related party Relationship Type of business
thousand yuan) thousand yuan)
China Electronic Other enterprises
Technology Finance Co., controlled by the actual Credit 20,000 0
Ltd controller
6. Transactions between the finance company controlled by the Company and related parties
□ Applicable √ Not applicable
There are no deposits, loans, credits or other financial business between the finance companies controlled by the Company and
related parties
7. Other related transactions
√ Applicable □ Not applicable
The Company entered into a financial service agreement with China Electronics Technology Finance Co., Ltd during the reporting
period, found more in relevant interim announcement. As of period-end, balance of the bank savings in China Electronics Technology
Finance Co., Ltd amounted to 7.1516 million yuan, interest of the deposit amounted to 17,800 yuan.
Website for temporary disclosure of the major connected transaction
Announcement Date of disclosure Website for disclosure
Notice on Related Transaction of Signing the
Financial Service Agreement with China November 24, 2021 Juchao Website
Electronic Technology Finance Co., Ltd
XV. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
No trusteeship for the Companyduring reporting period
85
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(2) Contract
□ Applicable √ Not applicable
No contract for the Companyduring reporting period
(3) Leasing
√ Applicable □ Not applicable
Explanation on leasing
During the reporting period, the Company incurred rent and property expenses of 3.9415 million yuan, and rent income of 2.675
million yuan.
Items that bringing gain/loss to the Company more than 10% of the total profits in reporting period
□ Applicable √ Not applicable
No items generated over 10% gains/losses in total profit in reporting period for the Company
2. Major guarantees
√ Applicable □ Not applicable
In 10 thousand Yuan
Particulars about the external guarantee of the Company and the subsidiaries (Barring the guarantee for subsidiaries)
Counter
Related -guarant Guarante
Name of
Announce Actual date Actual Collateral ee e for
the Guarantee Guarantee Guarantee Implemen
ment of guarantee (if situatio related
Company limit type term ted (Y/N)
disclosure happening limit applicable) n (if party
guaranteed
date applica (Y/N)
ble)
Guarantee between The Company and the subsidiaries
Counter
Related -guarant Guarante
Name of
Announce Actual date Actual Collateral ee e for
the Guarantee Guarantee Guarantee Implemen
ment of guarantee (if situatio related
Company limit type term ted (Y/N)
disclosure happening limit applicable) n (if party
guaranteed
date applica (Y/N)
ble)
Nanjing
Jointly 2021.6.23
Southern April 20, June 23,
5,000 1,000 liability -2022.3.2 N N
Telecom 2021 2021
guaranty 2
Co., Ltd
Nanjing April 20, October 28, Jointly 2021.10.2
5,000 2,000 N N
Southern 2021 2021 liability 8-2022.7.
86
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Telecom guaranty 22
Co., Ltd
Total amount of Total amount of actual
approving guarantee for occurred guarantee for
10,500 3,000
subsidiaries in report subsidiaries in report
period (B1) period (B2)
Total amount of Total balance of actual
approved guarantee for guarantee for
10,500 3,000
subsidiaries at the end of subsidiaries at the end of
reporting period (B3) reporting period (B4)
Guarantees of subsidiaries to subsidiaries
Counter
Related -guarant Guarante
Name of
Announce Actual date Actual Collateral ee e for
the Guarantee Guarantee Guarantee Implemen
ment of guarantee (if situatio related
Company limit type term ted (Y/N)
disclosure happening limit applicable) n (if party
guaranteed
date applica (Y/N)
ble)
Total amount of guarantee of the Company (total of three above mentioned guarantee)
Total amount of actual
Total amount of approving
occurred guarantee in
guarantee in report period 10,500 3,000
report period
(A1+B1+C1)
(A2+B2+C2)
Total balance of actual
Total amount of approved
guarantee at the end of
guarantee at the end of report 10,500 3,000
report period
period (A3+B3+C3)
(A4+B4+C4)
The proportion of the total amount of actually
guarantee in the net assets of the Company (that is 46.02%
A4+ B4+C4)
Including:
Amount of guarantee for shareholders, actual
0
controller and its related parties (D)
The debts guarantee amount provided for the
guaranteed parties whose assets-liability ratio 0
exceed 70% directly or indirectly (E)
Proportion of total amount of guarantee in net
0
assets of the Company exceed 50% (F)
Total amount of the aforesaid three guarantees
0
(D+E+F)
87
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Explanations on possibly bearing joint and several
liquidating responsibilities for undue guarantees N/A
(if applicable)
Explanations on external guarantee against
N/A
regulated procedures (if applicable)
Explanation on guarantee with composite way
3. Entrust others to cash asset management
(1) Trust financing
□ Applicable √ Not applicable
The Company had no trust financing during the reporting period.
(2) Entrusted loans
□ Applicable √ Not applicable
The Company had no entrusted loans during the reporting period.
4. Other material contracts
□ Applicable √ Not applicable
No other material contracts for the Companyduringthe reporting period
XVI. Explanation on other significant events
√ Applicable □ Not applicable
Index of the material events that disclosed in reporting period:
Event Disclosure date Index of information on appointed website
Notice on the completion of the transfer of the underlying 2021.1.5 Juchao Website (www.cninfo.com.cn)
assets of major asset sales and related-party transactions
Report on the implementation of major asset sales and 2021.1.5 Juchao Website (www.cninfo.com.cn)
related-party transactions
Notice on Major Asset Sales and Related Party Transactions 2021.1.5 Juchao Website (www.cninfo.com.cn)
Commitments
Notice on the progress of the transfer of Subsidiary's equity 2021.1.5 Juchao Website (www.cninfo.com.cn)
Notice on the progress of the acquisition of the equity of 2021.1.7 Juchao Website (www.cninfo.com.cn)
Subsidiary and the merger of Subsidiary
Notice on Resolution of 46th Session of 7th BOD 2021.1.22 Juchao Website (www.cninfo.com.cn)
2020 annual performance forecast 2021.1.30 Juchao Website (www.cninfo.com.cn)
Announcement of abnormal fluctuations in stock trading 2021.2.24 Juchao Website (www.cninfo.com.cn)
Indicative Notice on the proposed free transfer of the overall 2021.2.25 Juchao Website (www.cninfo.com.cn)
88
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
property rights of the actual controller
Notice on the response to the Shenzhen Stock Exchange's 2021.3.3 Juchao Website (www.cninfo.com.cn)
letter of concern
Notice on Resolution of 47th Session of 7th BOD 2021.3.10 Juchao Website (www.cninfo.com.cn)
Notice on Related Transaction of Applying for Entrust 2021.3.10 Juchao Website (www.cninfo.com.cn)
Loans to Controlling Shareholder
Preliminary Earnings Estimate for 2020 2021.4.15 Juchao Website (www.cninfo.com.cn)
Performance Forecast for Q1 of 2021 2021.4.15 Juchao Website (www.cninfo.com.cn)
th th
Notice on Resolution of 48 Session of 7 BOD 2021.4.20 Juchao Website (www.cninfo.com.cn)
Notice on Resolution of 20th Session of 7th Supervisory 2021.4.20 Juchao Website (www.cninfo.com.cn)
Committee
Summary of Annual Report 2020 2021.4.20 Juchao Website (www.cninfo.com.cn)
Notice on Provision for Impairment of Assets for 2020 2021.4.20 Juchao Website (www.cninfo.com.cn)
Notice on Guarantee for Controlling Subsidiary 2021.4.20 Juchao Website (www.cninfo.com.cn)
Notice of the Forecast for Daily Related Transaction for 2021.4.20 Juchao Website (www.cninfo.com.cn)
year of 2021
Notice on Convening the AGM of 2020 2021.4.20 Juchao Website (www.cninfo.com.cn)
Text of First Quarterly Report 2021 2021.4.29 Juchao Website (www.cninfo.com.cn)
CITIC Securities Co., Ltd.'s 2020 continuous supervision 2021.4.30 Juchao Website (www.cninfo.com.cn)
report on major asset sales and related transactions of
Nanjing Putian Telecommunications Co., Ltd.
Notice on Resolution of 50th Session of 7th BOD 2021.5.7 Juchao Website (www.cninfo.com.cn)
Notice on Related Transaction of Applying for Entrust 2021.5.7 Juchao Website (www.cninfo.com.cn)
Loans to Controlling Shareholder
Notice on Convening the First Extraordinary General 2021.5.7 Juchao Website (www.cninfo.com.cn)
Meeting of Shareholders of 2021
Notice on convening the 2020 annual performance online 2021.5.10 Juchao Website (www.cninfo.com.cn)
briefing
Notice on Resolution of AGM of 2020 2021.5.27 Juchao Website (www.cninfo.com.cn)
st
Notice on Convening the 1 Extraordinary Shareholders 2021.5.28 Juchao Website (www.cninfo.com.cn)
General Meeting of 2021
Notice on Reply to Inquiry Letter of Shenzhen Stock 2021.6.22 Juchao Website (www.cninfo.com.cn)
Exchange Annual Report
Notice on the approval of the reorganization of China Putian 2021.6.24 Juchao Website (www.cninfo.com.cn)
and China Electric Technology
Notice on the progress of guarantee for Subsidiary 2021.6.30 Juchao Website (www.cninfo.com.cn)
Performance Forecast for Semi-Annual of 2021 2021.7.15 Juchao Website (www.cninfo.com.cn)
Notice on Completion of the Filing of Article of Association 2021.7.21 Juchao Website (www.cninfo.com.cn)
and Registration Changes of the Registered Address for
Industry and Commerce
Notice on Resolution of 51th Session of 7th BOD 2021.8.27 Juchao Website (www.cninfo.com.cn)
89
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Notice on Resolution of 22th Session of 7th Supervisory 2021.8.27 Juchao Website (www.cninfo.com.cn)
Committee
Summary of Semi-Annual Report of 2021 2021.8.27 Juchao Website (www.cninfo.com.cn)
Notice on Provision for Assets Impairment in First Half of 2021.8.27 Juchao Website (www.cninfo.com.cn)
2021
Notice on Change of Accounting Policy 2021.8.27 Juchao Website (www.cninfo.com.cn)
Suggestive Announcement on the Equity Transfer Without 2021.9.1 Juchao Website (www.cninfo.com.cn)
Compensation of China Putian Corporation
Summary of Acquisition Report of Nanjing Putian 2021.9.1 Juchao Website (www.cninfo.com.cn)
Telecommunications Co., Ltd.
Acquisition Report of Nanjing Putian Telecommunications 2021.9.7 Juchao Website (www.cninfo.com.cn)
Co., Ltd.
Completion of Industrial & Commercial Change 2021.9.24 Juchao Website (www.cninfo.com.cn)
Registration on the Equity Transfer Without Compensation
of China Putian Corporation
Performance Forecast of 3Q of 2021 2021.10.15 Juchao Website (www.cninfo.com.cn)
Notice on cumulative lawsuits 2021.10.29 Juchao Website (www.cninfo.com.cn)
th th
Notice on Resolution of 52 Session of 7 BOD 2021.10.30 Juchao Website (www.cninfo.com.cn)
Text of 3Q report of 2021 2021.10.30 Juchao Website (www.cninfo.com.cn)
Increase the Forecast of Daily Related Transactions for year 2021.10.30 Juchao Website (www.cninfo.com.cn)
of 2021
Liquidation and Closure of Subsidiaries 2021.10.30 Juchao Website (www.cninfo.com.cn)
Progress of Guarantees for Subsidiaries 2021.11.2 Juchao Website (www.cninfo.com.cn)
Notice on Resolution of 53th Session of 7th BOD 2021.11.24 Juchao Website (www.cninfo.com.cn)
Notice on Related Transaction of Signing the Financial 2021.11.24 Juchao Website (www.cninfo.com.cn)
Service Agreement with China Electronic Technology
Finance Co., Ltd
Notice on Resolution of 54th Session of 7th BOD 2021.12.10 Juchao Website (www.cninfo.com.cn)
Appointment of the Audit Institution for Year of 2021 2021.12.10 Juchao Website (www.cninfo.com.cn)
nd
Notice on Convening the 2 Extraordinary Shareholders 2021.12.10 Juchao Website (www.cninfo.com.cn)
General Meeting of 2021
Notice on Convening the 2nd Extraordinary Shareholders 2021.12.28 Juchao Website (www.cninfo.com.cn)
General Meeting of 2021
XVII. Significant event of subsidiary of the Company
□ Applicable √ Not applicable
90
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section VII. Changes in Shares and Particular about Shareholders
I. Changes in shares
1. Changes in shares
Unit: Share
Before the Change Increase/Decrease in the Change (+, -) After the Change
Capitaliza
New
Bonus tion of Proportio
Amount Proportion shares Others Subtotal Amount
shares public n
issued
reserve
115,000,0 115,000,0
I. Unlisted shares 53.49% 53.49%
00 00
115,000,0 115,000,0
1. Sponsor’s shares 53.49% 53.49%
00 00
Including: state-owned 115,000,0 115,000,0
53.49% 53.49%
shares 00 00
Domestic legal
person’s shares
Overseas legal
person’s shares
Others
2. Recruitment
corporation shares
3. Internal employee
shares
4. Preferred shares or
others
100,000,0 100,000,0
II. Listed tradable shares 46.51% 46.51%
00 00
1. RMB ordinary shares
2. Domestically listed 100,000,0 100,000,0
46.51% 46.51%
foreign shares 00 00
3. Overseas listed foreign
shares
4. Others
III. Total shares 215,000,0 100.00% 215,000,0 100.00%
91
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
00 00
Reasons for share changed
□ Applicable √ Not applicable
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changes
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of restricted shares
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□ Applicable √ Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and
liability structure
□ Applicable √ Not applicable
3. Current internal staff shares
□ Applicable √ Not applicable
III. Shareholder and actual controller of the Company
1. Amount of shareholders of the Company and particulars about shares holding
Unit: Share
Total common Total preference Total preference
Total common
stock shareholders shareholders
stock
shareholders at with voting with voting
shareholders in 8,100 7,949 0 0
end of last month rights recovered rights recovered
reporting
before annual at end of at end of last
period-end
report disclosed reporting period month before
92
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(if applicable) annual report
(see note 8) disclosed (if
applicable) (see
note 8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Total Information of shares pledged, tagged or
Amount
sharehol Amount frozen
Proportio Changes of
Full name of Nature of n of ders at of listed
in report unlisted
Shareholders shareholder shares the end shares
held period shares State of share Amount
of report held
held
period
State-owned 115,000, 115,000,
China Potevio 53.49% 0 0
corporation 000 000
Shenwan
Foreign 6,416,82
HongYuan (H.K.) 2.98% 30,000 0 6,416,820
corporation 0
Limited
GUOTAI JUNAN
SECURITIES(H Foreign 2,794,90 -2,584,20
1.30% 0 2,794,906
ONGKONG) corporation 68
LIMITED
Domestic nature 2,449,73
Zheng Enyue 1.14% 0 0 2,449,739
person 9
Domestic nature 2,000,00
Sun Huiming 0.93% -7,110 0 2,000,000
person 0
Domestic nature 1,871,37
Gu Jinhua 0.87% 0 0 1,871,371
person 1
Guosen Securities
Foreign 1,828,68
(H.K.) Broker 0.85% 0 0 1,828,682
corporation 2
Co., Ltd.
BOCI
Foreign 1,266,94
SECURITIES 0.59% 0 0 1,266,945
corporation 5
LIMITED
Domestic nature
Zhen Hongquan 0.46% 991,900 86,300 0 991,900
person
Domestic nature
Xiang Yan 0.42% 905,602 0 0 905,602
person
Strategy investors or general legal
person becomes top 10 shareholders
N/A
due to rights issued (if applicable)
(see note3)
93
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Explanation on associated Among the top ten shareholders, China Potevio is neither a related party nor a person acting
relationship or concerted action in concert with the others. It’s unknown by the Company whether there are related parties or
among the aforesaid shareholders persons acting in concert among the other shareholders.
Description of the above
shareholders in relation to
delegate/entrusted voting rights and Not involved
abstention from voting rights.
Special note on the repurchase
account among the top 10 N/A
shareholders (See note 10)
Top 10 shareholders with circulation shares held
Type of shares
Shareholders’ name Amount of listed shares held at end of the Period
Type Amount
Domestically
Shenwan HongYuan (H.K.) Limited 6,416,820 listed foreign 6,416,820
shares
GUOTAI JUNAN Domestically
SECURITIES(HONGKONG) 2,794,906 listed foreign 2,794,906
LIMITED shares
Domestically
Zheng Enyue 2,449,739 listed foreign 2,449,739
shares
Domestically
Sun Huiming 2,000,000 listed foreign 2,000,000
shares
Domestically
Gu Jinhua 1,871,371 listed foreign 1,871,371
shares
Domestically
Guosen Securities (H.K.) Broker
1,828,682 listed foreign 1,828,682
Co., Ltd.
shares
Domestically
BOCI SECURITIES LIMITED 1,266,945 listed foreign 1,266,945
shares
Domestically
Zhen Hongquan 991,900 listed foreign 991,900
shares
Domestically
Xiang Yan 905,602 listed foreign 905,602
shares
94
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Domestically
Liang Wei 772,800 listed foreign 772,800
shares
Expiation on associated relationship
or consistent actors within the top 10
It’s unknown by the Company whether there are related parties or persons acting in concert
un-restrict shareholders and between
among the above mentioned shareholders.
top 10 un-restrict shareholders and
top 10 shareholders
Explanation on shareholders
involving margin business about top
ten common stock shareholders with N/A
un-restrict shares held(if applicable)
(see note4)
Whether top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held have a buy-back
agreement dealing in reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held of the Company have no
buy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: central state-owned holding
Type of controlling shareholders: legal person
Legal person/person
Controlling shareholder Date of foundation Organization code Main operation business
in charge of the unit
Focusing on manufacture
and trading of information
telecommunication
products, relevant
technology research and
China Potevio Lv Weiping July 23, 2003 91110000710931555N services. The operation
scope covers information
telecommunication,
broadcasting, industrial
information, financial
electrics and new energy.
Equity of other
domestic/oversea listed Other listed companies directly controlled at the beginning of the reporting period include Chengdu
Company control by Putian Cable Co., Ltd., and indirectly controlled listed companies include Oriental communication
controlling shareholder as co., ltd. and Eastcom Peace Smart Card Co., Ltd.; there are no other listed companies under control
well as stock-joint in report at end of the reporting period.
period
95
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Changes of controlling shareholders in reporting period
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period
3. Actual controller and person acting in concert of the Company
Nature of actual controller: central state-owned assets management
Type of actual controller: legal person
Legal
Actual controlling shareholders person/person in Date of foundation Organization code Main operation business
charge of the unit
Mainly engaged in the
engineering construction of
large electronic information
system for national important
Unified social credit
China Electronics Technology military and civilian use,
Chen Zhaoxiong February 25, 2002 code
Group Corporation research and production of the
91110000710929498G
major equipment,
communication & electronic
equipment, software and key
components
Other domestic and overseas listed companies actually controlled include: Hangzhou Hikvision
Digital Technology Co., Ltd., Taiji Computer Co., Ltd., China Electronics Technology Co., Ltd.,
Equity of domestic/oversea Chengdu Weishitong Information Industry Co., Ltd., Guorui Technology Co., Ltd., Sichuang
listed Company control by Electronics Co., Ltd., Chengdu Tian’ao Electronics Co., Ltd., Guangzhou Jiesai Technology Co.,
actual controller in report period Ltd., Phoenix Optical Co., Ltd., Zhongdian Kesheng Optoelectronics Technology Co., Ltd., Hebei
Zhongci Electronic Technology Co., Ltd., Oriental communication co., Ltd., Eastcom Peace Smart
Card Co., Ltd., Chengdu Putian Cable Co., Ltd.
Changes of actual controller in reporting period
√ Applicable □ Not applicable
The name of the original actual controller China Potevio Information Industry Group Co., Ltd.
The name of the new actual controller China Electronics Technology Group Corporation
Date of change September 1, 2021
Summary of Acquisition Report of Nanjing Putian
Specify the website query index
Telecommunications Co., Ltd. released on Juchao Website
Designated website disclosure date September 1, 2021
Property right and controlling relationship between the actual controller and The Company is as follow
96
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
State-owned Assets Supervision and Administration Commission of the State Council
100%
China Electronics Technology Group Corporation
100%
ChinaPutian Corporation
100%
China Potevio Company Limited.
53.49%
Nanjing Putian Telecommunications Co., Ltd.
Actual controller controlling the Company by entrust or other assets management
□ Applicable √ Not applicable
4.The total number of shares pledged by controlling shareholders or the first majority shareholder and its
persons acting in concert accounts for 80% of the shares held by them
□ Applicable √ Not applicable
5. Particulars about other legal person shareholders with over 10% shares held
□ Applicable √ Not applicable
6. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,
restructuring side and other commitment subjects
□ Applicable √ Not applicable
IV. The specific implementation of shares buy-back during the reporting period
Implementation progress of shares buy-back
□ Applicable √ Not applicable
Implementation progress of the reduction of repurchases shares by centralized bidding
□ Applicable √ Not applicable
97
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section VIII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock during the reporting period
98
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section IX. Corporate Bonds
□ Applicable √ Not applicable
99
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Section X. Financial Report
I. Audit report
Type of audit opinion Standard unqualified
Signing date of audit report April 22, 2022
Name of audit institute Pan-China Certified Public Accountants (LLP)
Serial of Auditing Report Pan-China Shen (2022) No.1-489
Name of CPA He Jiangxing, Zhang Jinghui
100
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Auditor’s Report
PCCPAAR [2022] No. 1-489
To the Shareholders of Nanjing Putian Telecommunications Co., Ltd.:
I. Audit Opinion
We have audited the accompanying financial statements of Nanjing Putian
Telecommunications Co., Ltd. (the ―Nanjing Putian Company‖), which comprise the
consolidated and parent company balance sheets as at December 31, 2021, the
consolidated and parent company income statements, the consolidated and parent
company cash flow statements, and the consolidated and parent company statements
of changes in equity for the year then ended, as well as notes to financial statements.
In our opinion, the attached financial statements present fairly, in all material respects,
the financial position of the Nanjing Putian Company as at December 31, 2021, and of
its financial performance and its cash flows for the year then ended in accordance
with China Accounting Standards for Business Enterprises.
II. Basis for Audit Opinion
We conducted our audit in accordance with CICPA Standards on Auditing (“CSAs”). ‘IV.
Certified Public Accountant’s Responsibility for the Financial Statements’ audit’ in this
report describes our responsibility under these standards. Those standards require that
we comply with ethical requirements, that we are independent from Nanjing Putian
Company and fulfilled all other ethical obligation. We believe that we have obtained
Complete and Just audit evidence as basis of audit opinion.
101
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters were
addressed in the context of our audit of the financial statements as a whole, and in forming
our opinion thereon, and we do not express a separate opinion on these matters.
(I) Impairment of accounts receivable
1. Key audit matters
Please refer to section III(X) and V(I) of the notes to the financial statements for details.
As of December 31, 2021, the book balance of accounts receivable amounted to
531,421,798.94 yuan, with provision for bad debts of 196,835,247.01 yuan, and the carrying
amount amounted to 334,586,551.93 yuan.
Based on credit risk features of accounts receivable, the Management measures the provision
for bad debts at the amount of expected credit losses during the whole life, either on an
individual basis or on a collective basis. For accounts receivable with expected credit losses
measured on an individual basis, the Management estimates the expected cash flows, so as to
identify the provision for bad debts to be accrued, based on a comprehensive consideration of
information with reasonableness and evidence, which is related to the past events, the current
situation and the forecast of future economic conditions. For accounts receivable with
expected credit losses measured on a collective basis, the Management classifies portfolios
on the basis of ages, adjusts them based on historical credit risk loss experience and
forward-looking estimations, prepares the comparison table of ages and expected credit loss
rate of accounts receivable, so as to calculate the provision for bad debts to be accrued.
As the amount of accounts receivable is significant and the impairment involves significant
judgment of the Management, we have identified impairment of accounts receivable as a key
audit matter.
2. Responsive audit procedures
Our main audit procedures for impairment of accounts receivable are as follows:
(1) We obtained understandings of key internal controls related to impairment of accounts
receivable, assessed the design of these controls, determined whether they had been executed,
102
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
and tested the effectiveness of their operation;
(2) We reviewed the accounts receivable with provision for bad debts made in previous
periods for their subsequent write-off or reversal, and assessed the accuracy of historical
estimations made by the Management;
(3) We reviewed the consideration of the Management on credit risk assessment and objective
evidence, and assessed whether the credit risk features of accounts receivable had been
appropriately identified by the Management;
(4) For accounts receivable with expected credit losses measured on an individual basis, we
obtained and checked the Management’s estimations on the expected future cash flows,
assessed the reasonableness of key assumptions and the accuracy of data adopted in the
estimations and checked them with acquired external evidence;
(5) For accounts receivable with expected credit losses measured on a collective basis, we
assessed the reasonableness of portfolio classification on the basis of credit risk features; we
assessed the reasonableness of the comparison table of ages and expected credit loss rate of
accounts receivable prepared by the Management based on the historical credit loss
experience of portfolios with similar credit risk features and forward-looking estimations; we
tested the accuracy and completeness of data used by the Management (including ages,
historical loss rate, migration rate, etc.) and whether the calculation of provision for bad debts
was accurate;
(6) We checked the subsequent collection of accounts receivable and assessed the
reasonableness of provision for bad debts made by the Management;
(7) We checked whether information related to impairment of accounts receivable had been
presented appropriately in the financial statements.
(II) Net realizable value of inventories
1. Key audit matters
Please refer to section III(XI) and V(I)VIII of the notes to the financial statements for details.
As of December 31, 2021, the book balance of inventories amounted to 298,253,196.96 yuan,
with provision for bad debts of 111,721,631.26 yuan, and the carrying amount amounted to
103
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
186,531,565.70 yuan.
At the balance sheet date, inventories are measured at the lower of cost and net realizable
value, with provisions for inventory write-down made on the excess of its cost over the net
realizable value on a collective basis/on an individual basis. Based on the Management’s
consideration over purposes that the inventories were held for, the estimated selling price is
determined based on historical selling price, actual selling price, contractual selling price,
market price of identical or similar products, future market trend, etc., and the net realizable
value of these inventories is determined based on the amount of the estimated selling price
less the cost to be incurred upon completion, estimated selling expenses and relevant taxes
and surcharges.
As the amount of inventories is significant and determination of net realizable value involves
significant judgment of the Management, we have identified net realizable value of
inventories as a key audit matter.
2. Responsive audit procedures
Our main audit procedures for net realizable value of inventories are as follows:
(1) We obtained understandings of key internal controls related to net realizable value of
inventories, assessed the design of these controls, determined whether they had been executed,
and tested the effectiveness of their operation;
(2) We reviewed the net realizable value estimated by the Management in previous years and
the actual operating results, and assessed the accuracy of the Management’s historical
estimations;
(3) We reviewed the estimation on selling price made by the Management by sampling
method and compared the estimated selling price with historical data, subsequent situation,
market information, etc.;
(4) We assessed the reasonableness of estimation on cost to be incurred upon completion,
selling expenses and relevant taxes and surcharges made by the Management;
(5) We tested whether the calculation of net realizable value of inventories made by the
Management was accurate;
104
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(6) We checked whether there existed situations such as inventories with long stock age and
obsolete model, decline in production, fluctuation of production cost or selling price, change
in technology or market needs, etc. in combination with stocktaking, and assessed whether
the net realizable value of inventories was reasonably estimated by the Management;
(7) We checked whether information related to net realizable value of inventories had been
presented appropriately in the financial statements.
IV. Other Information
The Nanjing Putian Company’s management (the ―Management‖) is responsible for the other
information. The other information comprises the information included in the Nanjing Putian
Company’s annual report, but does not include the financial statements and our auditor’s
report thereon.
Our opinion on the financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained in the audit or otherwise
appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement
of the other information, we are required to report that fact. We have nothing to report in this
regard.
V. Responsibilities of the Management and Those Charged with Governance for the
Financial Statements
Management of Nanjing Putian Company is responsible for the preparation and present these
financial statements fairly in accordance with the requirements of Accounting Standards for
Business Enterprises, and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error.
105
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Management of Nanjing Putian Company is also responsible for evaluate Nanjing
Putian Company’s corporate sustainability, disclose events related to its sustainability
(if applicable), and complying going concern assumption, unless the management is
arranging either liquidation, termination or no realistic option to comply.
Those charged with governance are responsible for overseeing the Nanjing Putian
Company’s financial reporting process.
VI. Certified Public Accountant’s Responsibilities for the Audit of the Financial
Statements
Our objectives are to obtain reasonable assurance about whether the Financial
Statements as a whole are free from material misstatements, whether due to fraud or
error, and to issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with CSAs will always detect a material misstatement when
it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the
economic decisions the users taken on the basis of these Financial Statements.
As part of an audit in accordance with CSAs, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
(I) Identify and assess the risks of material misstatements of the Financial Statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and appropriate to provide a basis of
our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, intentional
omissions, misrepresentations, or the override of internal control.
(II) Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances.
(III) Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by the Management.
(IV) Conclude on the appropriateness of the Management’s use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on the
Nanjing Putian Company’s ability to continue as a going concern. If we conclude that
106
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
(V) Evaluate the overall presentation, structure and content of the financial statements,
and whether the financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.
(VI) Obtain sufficient and appropriate audit evidence regarding the financial
information of the entities or business activities within the Company to express an
opinion on the financial statements. We are responsible for the direction, supervision
and performance of the group audit. We remain sole responsibility for our audit
opinion.
We communicate with those charged with governance regarding the planned audit
scope, time schedule and significant audit findings, including any deficiencies in
internal control of concern that we identify during our audit.
We also provide those charged with governance with a statement that we have
complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine
those matters that were of most significance in the audit of the financial statements of
the current period and are therefore the key audit matters. We describe these matters
in our auditor’s report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so
would reasonably be expected to outweigh the public interest benefits of such
communication.
Pan-China Certified Public Accountants LLP Chinese Certified Public Accountant
(Engagement Partner)
107
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Hangzhou China Chinese Certified Public Accountant
Date of Report: April 22 , 2022
The auditor’s report and the accompanying financial statements are English translations of the Chinese auditor’s
report and statutory financial statements prepared under accounting principles and practices generally accepted
in the People’s Republic of China. These financial statements are not intended to present the financial position and
results of operations and cash flows in accordance with accounting principles and practices generally accepted in
other countries and jurisdictions. In case the English version does not conform to the Chinese version, the Chinese
version prevails.
108
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Consolidated balance sheet as at December 31, 2021
(Expressed in Renminbi Yuan)
Note
Assets Closing balance Opening balance
No.
Current assets:
Cash and bank balances 1 188,665,530.37 209,849,710.96
Settlement funds
Loans to other banks
Held-for-trading financial assets 2 20,000,000.00
Derivative financial assets
Notes receivable 3 13,703,192.38 17,029,051.04
Accounts receivable 4 334,586,551.93 493,992,403.49
Receivables financing 5 40,852,223.88 32,594,702.60
Advances paid 6 22,645,816.66 19,616,348.65
Premiums receivable
Reinsurance accounts receivable
Reinsurance reserve receivable
Other receivables 7 16,628,195.17 16,911,790.31
Financial assets under reverse repo
Inventories 8 186,531,565.70 199,641,972.32
Contract assets
Assets classified as held for sale
Non-current assets due within one year
Other current assets 9 7,763,000.07 13,126,022.08
Total current assets 831,376,076.16 1,002,762,001.45
Non-current assets:
Loans and advances paid
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 10 10,422,193.15 10,422,056.96
Other equity instrument investments 11 741,953.00 741,953.00
Other non-current financial assets
Investment property 12 6,854,891.51 4,267,013.35
Fixed assets 13 117,801,156.71 100,158,063.58
Construction in progress 14 292,996.23 22,454,792.27
Productive biological assets
Oil & gas assets
Right-of-use assets
Intangible assets 15 21,108,747.48 21,261,119.40
Development expenditures
Goodwill
Long-term prepayments 16 4,973,968.20 5,541,410.81
109
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Deferred tax assets 17
Other non-current assets
Total non-current assets 162,195,906.28 164,846,409.37
Total assets 993,571,982.44 1,167,608,410.82
110
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Consolidated balance sheet as at December 31, 2021(continued)
(Expressed in Renminbi Yuan)
Note
Liabilities & Equity Closing balance Opening balance
No.
Current liabilities:
Short-term borrowings 18 199,000,000.00 65,000,000.00
Central bank loans
Loans from other banks
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 19 1,251,741.17 76,135,010.10
Accounts payable 20 538,363,742.94 604,765,586.00
Advances received 21
Contract liabilities 22 18,884,024.60 28,518,252.40
Financial liabilities under repo
Absorbing deposit and interbank deposit
Deposit for agency security transaction
Deposit for agency security underwriting
Employee benefits payable 23 19,445,171.68 17,362,878.28
Taxes and rates payable 24 2,881,067.35 8,707,248.67
Other payables 25 64,006,795.08 53,759,120.63
Handling fee and commission payable
Reinsurance accounts payable
Liabilities classified as held for sale
Non-current liabilities due within one year 25 2,656,474.95 9,181,720.08
Other current liabilities 26 2,454,923.31 3,707,372.81
Total current liabilities 848,943,941.08 867,137,188.97
Non-current liabilities:
Insurance policy reserve
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables 27 4,036,160.05
Long-term employee benefits payable
Provisions
Deferred income
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities 4,036,160.05
Total liabilities 848,943,941.08 871,173,349.02
Equity:
Share capital/Paid-in capital 28 215,000,000.00 215,000,000.00
Other equity instruments
111
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Including: Preferred shares
Perpetual bonds
Capital reserve 29 197,864,174.08 183,568,842.44
Less: Treasury shares
Other comprehensive income 30 -6,819,637.82 -6,853,931.65
Special reserve
Surplus reserve 31 589,559.77 589,559.77
General risk reserve
Undistributed profit 32 -341,446,683.34 -202,680,309.64
Total equity attributable to the parent company 65,187,412.69 189,624,160.92
Non-controlling interest 79,440,628.67 106,810,900.88
Total equity 144,628,041.36 296,435,061.80
Total liabilities & equity 993,571,982.44 1,167,608,410.82
112
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Parent company balance sheet as at December 31, 2021
(Expressed in Renminbi Yuan)
Note
Assets Closing balance Opening balance
No.
Current assets:
Cash and bank balances 36,485,015.68 57,345,349.24
Held-for-trading financial assets
Derivative financial assets
Notes receivable 390,277.10 1,190,734.45
Accounts receivable 1 124,745,572.67 218,887,318.18
Receivables financing 2,756,775.53
Advances paid 15,353,338.77 10,138,293.79
Other receivables 2 28,544,036.00 50,275,151.96
Inventories 48,126,590.30 80,454,321.56
Contract assets
Assets classified as held for sale
Non-current assets due within one year
Other current assets 379,332.63 7,516,579.06
Total current assets 256,780,938.68 425,807,748.24
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 3 123,831,261.79 123,831,124.60
Other equity instrument investments 741,953.00 741,953.00
Other non-current financial assets
Investment property
Fixed assets 43,878,403.96 45,117,637.57
Construction in progress
Productive biological assets
Oil & gas assets
Right-of-use assets
Intangible assets 4,644,068.97 5,006,099.13
Development expenditures
Goodwill
Long-term prepayments 4,192,313.07 4,461,404.63
Deferred tax assets
Other non-current assets
Total non-current assets 177,288,000.79 179,158,218.93
Total assets 434,068,939.47 604,965,967.17
113
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Parent company balance sheet as at December 31, 20201(continued)
(Expressed in Renminbi Yuan)
Note
Liabilities & Equity Closing balance Opening balance
No.
Current liabilities:
Short-term borrowings 145,000,000.00 30,000,000.00
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 1,251,741.17 76,135,010.10
Accounts payable 170,302,775.78 214,453,536.53
Advances received
Contract liabilities 7,311,902.06 14,109,283.43
Employee benefits payable 9,250,482.99 7,931,673.97
Taxes and rates payable 57,506.75 115,233.85
Other payables 141,386,167.51 164,586,605.64
Liabilities classified as held for sale
Non-current liabilities due within one year 2,656,474.95 9,181,720.08
Other current liabilities 950,547.38 1,834,206.85
Total current liabilities 478,167,598.59 518,347,270.45
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables 4,036,160.05
Long-term employee benefits payable
Provisions
Deferred income
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities 4,036,160.05
Total liabilities 478,167,598.59 522,383,430.50
Equity:
Share capital/Paid-in capital 215,000,000.00 215,000,000.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserve 158,864,042.34 158,864,042.34
Less: Treasury shares
Other comprehensive income -1,854,910.00 -1,854,910.00
Special reserve
114
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Surplus reserve 589,559.76 589,559.76
Undistributed profit -416,697,351.22 -290,016,155.43
Total equity -44,098,659.12 82,582,536.67
Total liabilities & equity 434,068,939.47 604,965,967.17
115
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Consolidated income statement for the year ended December 31, 2021
(Expressed in Renminbi Yuan)
Note Current period Preceding period
Items
No. cumulative comparative
I. Total operating revenue 917,129,674.49 1,025,243,815.83
Including: Operating revenue 1 917,129,674.49 1,025,243,815.83
Interest income
Premium earned
Revenue from handling charges and commission
II. Total operating cost 949,166,725.55 1,099,375,113.92
Including: Operating cost 1 722,497,650.68 846,905,942.49
Interest expenses
Handling charges and commission expenditures
Surrender value
Net payment of insurance claims
Net provision of insurance policy reserve
Premium bonus expenditures
Reinsurance expenses
Taxes and surcharges 2 5,237,496.70 5,849,160.81
Selling expenses 3 91,425,098.10 101,208,835.79
Administrative expenses 4 67,220,016.02 75,477,706.26
R&D expenses 5 55,472,535.49 46,319,505.38
Financial expenses 6 7,313,928.56 27,074,088.99
Including: Interest expenses 8,198,913.03 28,568,012.81
Interest income 1,231,541.18 1,758,180.41
Add: Other income 7 2,431,022.05 10,988,973.73
Investment income (or less: losses) 8 2,434,520.91 93,175,109.94
Including: Investment income from associates and joint ventures 136.19 -4,769,983.62
Gains from derecognition of financial assets at amortized cost 2,434,384.72 -952,176.00
Gains on foreign exchange (or less: losses)
Gains on net exposure to hedging risk (or less: losses)
Gains on changes in fair value (or less: losses)
Credit impairment loss 9 -46,296,202.37 -41,615,815.85
Assets impairment loss 10 -61,026,996.13 -14,421,937.22
Gains on asset disposal (or less: losses) 11 -134,892.35 72,556,988.01
III. Operating profit (or less: losses) -134,629,598.95 43,091,894.72
Add: Non-operating revenue 12 485,555.18 4,301,614.63
Less: Non-operating expenditures 13 160,675.13 2,213,895.60
IV. Profit before tax (or less: total loss) -134,304,718.90 45,179,613.75
Less: Income tax 14 5,789,994.37 7,504,586.94
V. Net profit (or less: net loss) -140,094,713.27 37,675,026.81
(I) Categorized by the continuity of operations
1. Net profit from continuing operations (or less: net loss) -140,094,713.27 37,675,026.81
116
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2. Net profit from discontinued operations (or less: net loss)
(II) Categorized by the portion of equity ownership
1. Net profit attributable to owners of parent company (or less: net loss) -138,766,373.70 21,964,552.84
2. Net profit attributable to non-controlling shareholders (or less: net loss) -1,328,339.57 15,710,473.97
VI. Other comprehensive income after tax 34,293.83 -77,806.80
Items attributable to the owners of the parent company 34,293.83 -77,806.80
(I) Not to be reclassified subsequently to profit or loss
1. Changes in remeasurement on the net defined benefit plan
2. Items under equity method that will not be reclassified to profit or loss
3. Changes in fair value of other equity instrument investments
4. Changes in fair value of own credit risk
5. Others
(II) To be reclassified subsequently to profit or loss 34,293.83 -77,806.80
1. Items under equity method that may be reclassified to profit or loss
2. Changes in fair value of other debt investments
3. Profit or loss from reclassification of financial assets into other comprehensive income
4. Provision for credit impairment of other debt investments
5. Cash flow hedging reserve
6. Translation reserve 34,293.83 -77,806.80
7. Others
Items attributable to non-controlling shareholders
VII. Total comprehensive income -140,060,419.44 37,597,220.01
Items attributable to the owners of the parent company -138,732,079.87 21,886,746.04
Items attributable to non-controlling shareholders -1,328,339.57 15,710,473.97
VIII. Earnings per share (EPS):
(I) Basic EPS (yuan per share) -0.65 0.10
(II) Diluted EPS (yuan per share) -0.65 0.10
117
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Parent company income statement for the year ended December 31, 2021
(Expressed in Renminbi Yuan)
Note Current period Preceding period
Items
No. cumulative comparative
I. Operating revenue 1 121,253,065.68 204,317,900.56
Less: Operating cost 1 108,698,958.12 199,201,858.68
Taxes and surcharges 887,582.51 902,601.86
Selling expenses 26,650,179.27 39,753,159.16
Administrative expenses 35,111,905.62 44,093,681.35
R&D expenses 6,217,458.99 6,647,759.39
Financial expenses 4,971,349.45 29,762,090.06
Including: Interest expenses 6,021,877.48 31,156,701.57
Interest income 1,102,616.10 1,497,839.93
Add: Other income 234,500.00 2,360,474.80
Investment income (or less: losses) 2 12,187,920.91 156,256,067.52
Including: Investment income from associates and joint ventures 136.19 -4,769,983.62
Gains from derecognition of financial assets at amortized cost 2,434,384.72 -952,176.00
Gains on net exposure to hedging risk (or less: losses)
Gains on changes in fair value (or less: losses)
Credit impairment loss -33,748,185.70 -35,754,696.75
Assets impairment loss -43,730,325.27 -13,427,856.98
Gains on asset disposal (or less: losses) -189,842.76 72,730,654.86
II. Operating profit (or less: losses) -126,530,301.10 66,121,393.51
Add: Non-operating revenue 100,621.81
Less: Non-operating expenditures 150,894.69 2,180,198.43
III. Profit before tax (or less: total loss) -126,681,195.79 64,041,816.89
Less: Income tax
IV. Net profit (or less: net loss) -126,681,195.79 64,041,816.89
(I) Net profit from continuing operations (or less: net loss) -126,681,195.79 64,041,816.89
(II) Net profit from discontinued operations (or less: net loss)
V. Other comprehensive income after tax
(I) Not to be reclassified subsequently to profit or loss
1. Changes in remeasurement on the net defined benefit plan
2. Items under equity method that will not be reclassified to profit or loss
3. Changes in fair value of other equity instrument investments
4. Changes in fair value of own credit risk
5. Others
(II) To be reclassified subsequently to profit or loss
1. Items under equity method that may be reclassified to profit or loss
2. Changes in fair value of other debt investments
3. Profit or loss from reclassification of financial assets into other
comprehensive income
4. Provision for credit impairment of other debt investments
5. Cash flow hedging reserve
6. Translation reserve
7. Others
VI. Total comprehensive income -126,681,195.79 64,041,816.89
VII. Earnings per share (EPS):
(I) Basic EPS (yuan per share)
118
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(II) Diluted EPS (yuan per share)
119
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Consolidated cash flow statement for the year ended December 31, 2021
(Expressed in Renminbi Yuan)
Note Current period Preceding period
Items
No. cumulative comparative
I. Cash flows from operating activities:
Cash receipts from sale of goods or rendering of services 1,012,793,323.59 1,186,849,798.95
Net increase of client deposit and interbank deposit
Net increase of central bank loans
Net increase of loans from other financial institutions
Cash receipts from original insurance contract premium
Net cash receipts from reinsurance
Net increase of policy-holder deposit and investment
Cash receipts from interest, handling charges and commission
Net increase of loans from others
Net increase of repurchase
Net cash receipts from agency security transaction
Receipts of tax refund 7,426,691.80 4,611,350.90
Other cash receipts related to operating activities 1 18,978,779.20 15,785,966.22
Subtotal of cash inflows from operating activities 1,039,198,794.59 1,207,247,116.07
Cash payments for goods purchased and services received 812,607,602.97 819,268,501.77
Net increase of loans and advances to clients
Net increase of central bank deposit and interbank deposit
Cash payments for insurance indemnities of original insurance contracts
Net increase of loans to others
Cash payments for interest, handling charges and commission
Cash payments for policy bonus
Cash paid to and on behalf of employees 193,602,468.59 177,936,827.34
Cash payments for taxes and rates 41,109,567.34 44,630,285.36
Other cash payments related to operating activities 2 53,596,684.45 77,266,152.73
Subtotal of cash outflows from operating activities 1,100,916,323.35 1,119,101,767.20
Net cash flows from operating activities -61,717,528.76 88,145,348.87
II. Cash flows from investing activities:
Cash receipts from withdrawal of investments 227,492,228.00
Cash receipts from investment income
Net cash receipts from the disposal of fixed assets, intangible assets and other
490,953.92 90,389,036.16
long-term assets
Net cash receipts from the disposal of subsidiaries & other business units 42,983,999.65
Other cash receipts related to investing activities
Subtotal of cash inflows from investing activities 490,953.92 360,865,263.81
Cash payments for the acquisition of fixed assets, intangible assets and other
9,998,642.89 15,963,551.12
long-term assets
Cash payments for investments 20,000,001.00
120
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Note Current period Preceding period
Items
No. cumulative comparative
Net increase of pledged borrowings
Net cash payments for the acquisition of subsidiaries & other business units
Other cash payments related to investing activities
Subtotal of cash outflows from investing activities 29,998,643.89 15,963,551.12
Net cash flows from investing activities -29,507,689.97 344,901,712.69
III. Cash flows from financing activities:
Cash receipts from absorbing investments
Including: Cash received by subsidiaries from non-controlling shareholders as
investments
Cash receipts from borrowings 239,500,000.00 184,998,007.80
Other cash receipts related to financing activities 3 4,000,000.00
Subtotal of cash inflows from financing activities 239,500,000.00 188,998,007.80
Cash payments for the repayment of borrowings 105,500,000.00 571,395,742.19
Cash payments for distribution of dividends or profits and for interest expenses 21,847,513.03 78,843,126.92
Including: Cash paid by subsidiaries to non-controlling shareholders as dividend
13,648,600.00 49,756,900.00
or profit
Other cash payments related to financing activities 4 10,561,405.18 10,430,132.25
Subtotal of cash outflows from financing activities 137,908,918.21 660,669,001.36
Net cash flows from financing activities 101,591,081.79 -471,670,993.56
IV. Effect of foreign exchange rate changes on cash & cash equivalents 30,460.93 -97,187.73
V. Net increase in cash and cash equivalents 10,396,323.99 -38,721,119.73
Add: Opening balance of cash and cash equivalents 170,062,746.87 208,783,866.60
VI. Closing balance of cash and cash equivalents 180,459,070.86 170,062,746.87
121
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Parent company cash flow statement for the year ended December 31, 2021
(Expressed in Renminbi Yuan)
Note Current period Preceding period
Items
No. cumulative comparative
I. Cash flows from operating activities:
Cash receipts from sale of goods and rendering of services 201,338,916.81 354,206,107.38
Receipts of tax refund 5,677,842.21 97,559.18
Other cash receipts related to operating activities 21,347,210.38 21,367,785.41
Subtotal of cash inflows from operating activities 228,363,969.40 375,671,451.97
Cash payments for goods purchased and services received 213,480,897.14 244,301,702.01
Cash paid to and on behalf of employees 61,786,970.13 61,739,154.02
Cash payments for taxes and rates 1,908,031.65 7,181,904.61
Other cash payments related to operating activities 37,275,425.19 118,640,184.23
Subtotal of cash outflows from operating activities 314,451,324.11 431,862,944.88
Net cash flows from operating activities -86,087,354.71 -56,191,492.91
II. Cash flows from investing activities:
Cash receipts from withdrawal of investments 266,658,637.16
Cash receipts from investment income 9,153,400.00 82,727,700.00
Net cash receipts from the disposal of fixed assets, intangible
489,903.92 90,196,791.73
assets and other long-term assets
Net cash receipts from the disposal of subsidiaries & other
business units
Other cash receipts related to investing activities
Subtotal of cash inflows from investing activities 9,643,303.92 439,583,128.89
Cash payments for the acquisition of fixed assets, intangible assets
3,080,531.04 3,437,576.27
and other long-term assets
Cash payments for investments 1.00 2,000,000.00
Net cash payments for the acquisition of subsidiaries & other
business units
Other cash payments related to investing activities
Subtotal of cash outflows from investing activities 3,080,532.04 5,437,576.27
Net cash flows from investing activities 6,562,771.88 434,145,552.62
III. Cash flows from financing activities:
Cash receipts from absorbing investments
Cash receipts from borrowings 145,000,000.00 109,998,007.80
Other cash receipts related to financing activities 13,300,000.00 4,000,000.00
Subtotal of cash inflows from financing activities 158,300,000.00 113,998,007.80
Cash payments for the repayment of borrowings 30,000,000.00 451,335,325.52
Cash payments for distribution of dividends or profits and for
6,021,877.48 31,632,011.57
interest expenses
Other cash payments related to financing activities 33,561,405.18 10,430,132.25
Subtotal of cash outflows from financing activities 69,583,282.66 493,397,469.34
Net cash flows from financing activities 88,716,717.34 -379,399,461.54
IV. Effect of foreign exchange rate changes on cash and cash
equivalents
V. Net increase in cash and cash equivalents 9,192,134.51 -1,445,401.83
122
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Note Current period Preceding period
Items
No. cumulative comparative
Add: Opening balance of cash and cash equivalents 24,349,341.34 25,794,743.17
VI. Closing balance of cash and cash equivalents 33,541,475.85 24,349,341.34
123
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Consolidated statement of changes in equity for the year ended December 31, 2021
(Expressed in Renminbi Yuan)
Current period cumulative
Equity attributable to parent company
Items Other equity instruments Non-controlling
Less: Other Total equity
Share capital/ Special Surplus General risk Undistributed interest
Preferred Perpetual
Capital reserve Treasury comprehensive reserve reserve profit
Paid-in capital Others income reserve
shares bonds shares
I. Balance at the end of prior year 215,000,000.00 183,568,842.44 -6,853,931.65 589,559.77 -202,680,309.64 106,810,900.88 296,435,061.80
Add: Cumulative changes of accounting
policies
Error correction of prior period
Business combination under common
control
Others
II. Balance at the beginning of current year 215,000,000.00 183,568,842.44 -6,853,931.65 589,559.77 -202,680,309.64 106,810,900.88 296,435,061.80
III. Current period increase (or less: decrease) 14,295,331.64 34,293.83 -138,766,373.70 -27,370,272.21 -151,807,020.44
(I) Total comprehensive income 34,293.83 -138,766,373.70 -1,328,339.57 -140,060,419.44
(II) Capital contributed or withdrawn by -14,295,332.64 -1.00
14,295,331.64
owners
1. Ordinary shares contributed by owners
2. Capital contributed by holders of other
equity instruments
3. Amount of share-based payment included
in equity
4. Others 14,295,331.64 -14,295,332.64 -1.00
(III) Profit distribution -11,746,600.00 -11,746,600.00
1. Appropriation of surplus reserve
2. Appropriation of general risk reserve
3. Appropriation of profit to owners -11,746,600.00 -11,746,600.00
4. Others
124
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Current period cumulative
Equity attributable to parent company
Items Other equity instruments Non-controlling
Less: Other Total equity
Share capital/ Special Surplus General risk Undistributed interest
Capital reserve Treasury comprehensive reserve
Paid-in capital Preferred Perpetual Others reserve reserve profit
shares income
shares bonds
(IV) Internal carry-over within equity
1. Transfer of capital reserve to capital
2. Transfer of surplus reserve to capital
3. Surplus reserve to cover losses
4. Changes in defined benefit plan carried
over to retained earnings
5. Other comprehensive income carried over
to retained earnings
6. Others
(V) Special reserve
1. Appropriation of current period
2. Application of current period
(VI) Others
IV. Balance at the end of current period 215,000,000.00 197,864,174.08 -6,819,637.82 589,559.77 -341,446,683.34 79,440,628.67 144,628,041.36
125
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Consolidated statement of changes in equity for the year ended December 31, 2021 (continued)
(Expressed in Renminbi Yuan)
Preceding period comparative
Equity attributable to parent company
Items Other equity instruments Non-controlling
Less: Other General Total equity
Share capital/ Special Surplus Undistributed interest
Preferred Perpetual
Capital reserve Treasury comprehensive reserve risk
profit
Paid-in capital Others income reserve reserve
shares bonds shares
I. Balance at the end of prior year 215,000,000.00 185,374,533.85 -6,776,124.85 589,559.77 -224,644,862.48 130,557,035.50 300,100,141.79
Add: Cumulative changes of accounting policies
Error correction of prior period
Business combination under common control
Others
II. Balance at the beginning of current year 215,000,000.00 185,374,533.85 -6,776,124.85 589,559.77 -224,644,862.48 130,557,035.50 300,100,141.79
III. Current period increase (or less: decrease) -1,805,691.41 -77,806.80 21,964,552.84 -23,746,134.62 -3,665,079.99
(I) Total comprehensive income -77,806.80 21,964,552.84 15,710,473.97 37,597,220.01
(II) Capital contributed or withdrawn by owners -1,805,691.41 1,805,691.41
1. Ordinary shares contributed by owners
2. Capital contributed by holders of other equity
instruments
3. Amount of share-based payment included in equity
4. Others -1,805,691.41 1,805,691.41
(III) Profit distribution -41,262,300.00 -41,262,300.00
1. Appropriation of surplus reserve
2. Appropriation of general risk reserve
3. Appropriation of profit to owners -41,262,300.00 -41,262,300.00
4. Others
(IV) Internal carry-over within equity
1. Transfer of capital reserve to capital
2. Transfer of surplus reserve to capital
3. Surplus reserve to cover losses
4. Changes in defined benefit plan carried over to
126
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Preceding period comparative
Equity attributable to parent company
Items Other equity instruments Non-controlling
Less: Other General Total equity
Share capital/ Special Surplus Undistributed interest
Capital reserve Treasury comprehensive reserve risk
Paid-in capital Preferred Perpetual Others reserve profit
shares income reserve
shares bonds
retained earnings
5. Other comprehensive income carried over to
retained earnings
6. Others
(V) Special reserve
1. Appropriation of current period
2. Application of current period
(VI) Others
IV. Balance at the end of current period 215,000,000.00 183,568,842.44 -6,853,931.65 589,559.77 -202,680,309.64 106,810,900.88 296,435,061.80
127
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Parent company statement of changes in equity for the year ended December 31, 2021
(Expressed in Renminbi Yuan)
Current period cumulative
Other equity instruments Less: Other
Items Share capital/ Special Undistributed
Preferred Perpetual Capital reserve Treasury comprehensive Surplus reserve Total equity
Paid-in capital Others reserve profit
shares bonds shares income
I. Balance at the end of prior year 215,000,000.00 158,864,042.34 -1,854,910.00 589,559.76 -290,016,155.43 82,582,536.67
Add: Cumulative changes of accounting policies
Error correction of prior period
Others
II. Balance at the beginning of current year 215,000,000.00 158,864,042.34 -1,854,910.00 589,559.76 -290,016,155.43 82,582,536.67
III. Current period increase (or less: decrease)
-126,681,195.79 -126,681,195.79
(I) Total comprehensive income
-126,681,195.79 -126,681,195.79
(II) Capital contributed or withdrawn by owners
1. Ordinary shares contributed by owners
2. Capital contributed by holders of other equity
instruments
3. Amount of share-based payment included in equity
4. Others
(III) Profit distribution
1. Appropriation of surplus reserve
2. Appropriation of profit to owners
3. Others
(IV) Internal carry-over within equity
1. Transfer of capital reserve to capital
2. Transfer of surplus reserve to capital
3. Surplus reserve to cover losses
4. Changes in defined benefit plan carried over to
retained earnings
5. Other comprehensive income carried over to retained
earnings
128
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
6. Others
(V) Special reserve
1. Appropriation of current period
2. Application of current period
(VI) Others
IV. Balance at the end of current period 215,000,000.00 158,864,042.34 -1,854,910.00 589,559.76 -416,697,351.22 -44,098,659.12
129
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Parent company statement of changes in equity for the year ended December 31, 2021 (continued)
(Expressed in Renminbi Yuan)
Preceding period comparative
Other equity instruments Less: Other
Items Share capital/ Undistributed
Preferred Perpetual Capital reserve Treasury comprehensive Special reserve Surplus reserve Total equity
Paid-in capital Others profit
shares bonds shares income
I. Balance at the end of prior year 215,000,000.00 172,417,299.81 -1,854,910.00 589,559.76 -354,057,972.32 32,093,977.25
Add: Cumulative changes of accounting policies
Error correction of prior period
Others
II. Balance at the beginning of current year 215,000,000.00 172,417,299.81 -1,854,910.00 589,559.76 -354,057,972.32 32,093,977.25
III. Current period increase (or less: decrease) -13,553,257.47 64,041,816.89 50,488,559.42
(I) Total comprehensive income 64,041,816.89 64,041,816.89
(II) Capital contributed or withdrawn by owners -13,553,257.47 -13,553,257.47
1. Ordinary shares contributed by owners
2. Capital contributed by holders of other equity
instruments
3. Amount of share-based payment included in equity
4. Others -13,553,257.47 -13,553,257.47
(III) Profit distribution
1. Appropriation of surplus reserve
2. Appropriation of profit to owners
3. Others
(IV) Internal carry-over within equity
1. Transfer of capital reserve to capital
2. Transfer of surplus reserve to capital
3. Surplus reserve to cover losses
4. Changes in defined benefit plan carried over to
retained earnings
5. Other comprehensive income carried over to retained
earnings
130
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
6. Others
(V) Special reserve
1. Appropriation of current period
2. Application of current period
(VI) Others
IV. Balance at the end of current period 215,000,000.00 158,864,042.34 -1,854,910.00 589,559.76 -290,016,155.43 82,582,536.67
[Sun Xigang] [Wang Huailin] [Tang Yiqiao]
[Legal representative] [Officer in charge of accounting] [Head of accounting department]
(Signature and stamp) (Signature and stamp) (Signature and stamp)
131
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Nanjing Putian Telecommunications Co., Ltd.
Notes to Financial Statements
For the year ended December 31, 2021
Monetary unit: RMB Yuan
I. Company profile
Nanjing Putian Telecommunications Co., Ltd. (the ―Company‖), whose predecessor is Nanjing
Telecommunication Facility Factory, was established as a limited liability company through financing under the
approval of National Economic Institutional Reform Commission with document of approval numbered TGS
[1997] 28 dated March 21, 1997. It was registered in Nanjing Administration for Industry and Commerce on May
18, 1997, and its headquartered in Nanjing City, Jiangsu Province. Currently it holds a business license with
unified social credit code of 91320000134878054G, with registered capital of 215,000,000.00 yuan, total share of
215,000,000 shares, with par value of 1 yuan per share. Among them, 115,000,000 shares are state-owned legal
person shares, and 100,000,000 shares are B shares. The Company was listed on the Shenzhen Stock Exchange on
May 22, 1997.
The Company belongs to telecommunication equipment manufacture industry and is mainly engaged in R&D,
production, and sale of data, wire and wireless telecommunication equipment, distribution and allocation of layout
of telecommunication product, multimedia computer, digital television, vehicle electronics and conference video
system. R & D, manufacturing and sales of new energy vehicle charging products and their accessories (including
electric vehicle charger charging module, charging station system, split charging cabinet, outdoor integrated pile,
various AC and DC charging piles and other accessories); Design and sales of new energy charging and
discharging overall solutions; Electric vehicle charging operation and maintenance. R & D and sales of software
and intelligent software platform. Smart city, smart elderly care and other industry information services. R & D,
manufacturing, sales, installation and service of video equipment and video conference system. Agent sales of
communication modified vehicles (excluding wholesale), and provide corresponding after-sales service. Design,
system integration and related consulting services of communication information network engineering and
computer information system engineering. Design, construction, installation and service of building intelligent
system engineering. Lease of self owned assets such as houses and equipment.
The financial statements have been deliberated and approved for issue by the Board of Directors dated April 22,
2022.
The Company has brought 9 subsidiaries including Nanjing South Telecommunications Co., Ltd., and Nanjing
Putian Telege Intelligent Building Co., Ltd. etc. into the consolidated scope. Please refer to notes of VII for details.
II. Preparation basis of the financial statements
(I) Preparation basis
The financial statements have been prepared on the basis of going concern.
(II) Assessment of the ability to continue as a going concern
132
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
The Company has no events or conditions that may cast significant doubts upon the Company’s ability to continue
as a going concern within the 12 months after the balance sheet date.
III. Significant accounting policies and estimates
Important note:
The Company has set up accounting policies and estimates on transactions or events such as impairment of
financial instruments, depreciation of fixed assets, depreciation of right-of-use assets, amortization of intangible
assets, and revenue recognition, etc. based on the Company’s actual production and operation features.
(I) Statement of compliance
The financial statements have been prepared in accordance with the requirements of China Accounting Standards
for Business Enterprises (CASBEs), and present truly and completely the financial position, results of operations
and cash flows of the Company.
(II) Accounting period
The accounting year of the Company runs from January 1 to December 31 under the Gregorian calendar.
(III) Operating cycle
The Company has a relatively short operating cycle for its business, an asset or a liability is classified as current if
it is expected to be realized or due within 12 months.
(IV) Functional currency
The Company’s functional currency is Renminbi (RMB) Yuan.
(V) Accounting treatments of business combination under and not under common control
1. Accounting treatment of business combination under common control
Assets and liabilities arising from business combination are measured at carrying amount of the combined party
included in the consolidated financial statements of the ultimate controlling party at the combination date.
Difference between carrying amount of the equity of the combined party included in the consolidated financial
statements of the ultimate controlling party and that of the combination consideration or total par value of shares
issued is adjusted to capital reserve, if the balance of capital reserve is insufficient to offset, any excess is adjusted
to retained earnings.
2. Accounting treatment of business combination not under common control
When combination cost is in excess of the fair value of identifiable net assets obtained from the acquiree at the
acquisition date, the excess is recognized as goodwill; otherwise, the fair value of identifiable assets, liabilities and
contingent liabilities, and the measurement of the combination cost are reviewed, then the difference is recognized
in profit or loss.
(VI) Compilation method of consolidated financial statements
The parent company brings all its controlled subsidiaries into the consolidation scope. The
consolidated financial statements are compiled by the parent company according to ―CASBE 33 –
Consolidated Financial Statements‖, based on relevant information and the financial statements of
the parent company and its subsidiaries.
(VII) Classification of joint arrangements and accounting treatment of joint operations
1. Joint arrangements include joint operations and joint ventures.
133
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2. When the Company is a joint operator of a joint operation, it recognizes the following items in
relation to its interest in a joint operation:
(1) its assets, including its share of any assets held jointly;
(2) its liabilities, including its share of any liabilities incurred jointly;
(3) its revenue from the sale of its share of the output arising from the joint operation;
(4) its share of the revenue from the sales of the assets by the joint operation; and
(5) its expenses, including its share of any expenses incurred jointly.
(VIII) Recognition criteria of cash and cash equivalents
Cash as presented in cash flow statement refers to cash on hand and deposit on demand for
payment. Cash equivalents refer to short-term, highly liquid investments that can be readily
converted to cash and that are subject to an insignificant risk of changes in value.
(IX) Foreign currency translation
1. Translation of transactions denominated in foreign currency
Transactions denominated in foreign currency are translated into RMB yuan at the spot exchange
rate at the transaction date at initial recognition. At the balance sheet date, monetary items
denominated in foreign currency are translated at the spot exchange rate at the balance sheet date
with difference, except for those arising from the principal and interest of exclusive borrowings
eligible for capitalization, included in profit or loss; non-cash items carried at historical costs are
translated at the spot exchange rate at the transaction date, with the RMB amounts unchanged;
non-cash items carried at fair value in foreign currency are translated at the spot exchange rate at
the date when the fair value was determined, with difference included in profit or loss or other
comprehensive income.
2. Translation of financial statements measured in foreign currency
The assets and liabilities in the balance sheet are translated into RMB at the spot rate at the
balance sheet date; the equity items, other than undistributed profit, are translated at the spot rate
at the transaction date; the revenues and expenses in the income statement are translated into RMB
at the spot exchange rate at the transaction date. The difference arising from the aforementioned
foreign currency translation is included in other comprehensive income.
(X) Financial instruments
1. Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories when initially recognized: (1)
financial assets at amortized cost; (2) financial assets at fair value through other comprehensive
income; (3) financial assets at fair value through profit or loss.
Financial liabilities are classified into the following four categories when initially recognized: (1)
financial liabilities at fair value through profit or loss; (2) financial liabilities that arise when a
134
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
transfer of a financial asset does not qualify for derecognition or when the continuing involvement
approach applies; (3) financial guarantee contracts not fall within the above categories (1) and (2),
and commitments to provide a loan at a below-market interest rate, which do not fall within the
above category (1); (4) financial liabilities at amortized cost.
2. Recognition criteria, measurement method and derecognition condition of financial assets and financial
liabilities
(1) Recognition criteria and measurement method of financial assets and financial liabilities
When the Company becomes a party to a financial instrument, it is recognized as a financial asset
or financial liability. The financial assets and financial liabilities initially recognized by the
Company are measured at fair value; for the financial assets and liabilities at fair value through
profit or loss, the transaction expenses thereof are directly included in profit or loss; for other
categories of financial assets and financial liabilities, the transaction expenses thereof are included
into the initially recognized amount. However, at initial recognition, for accounts receivable that
do not contain a significant financing component or contracts in which the financing components
with associated period less than one year are not considered, the Company measures at their
transaction price in accordance with ―CASBE 14 – Revenues‖.
(2) Subsequent measurement of financial assets
1) Financial assets measured at amortized cost
The Company measures its financial assets at the amortized costs using effective interest method.
Gains or losses on financial assets that are measured at amortized cost and are not part of hedging
relationships shall be included into profit or loss when the financial assets are derecognized,
reclassified, amortized using effective interest method or recognized with impairment loss.
2) Debt instrument investments at fair value through other comprehensive income
The Company measures its debt instrument investments at fair value. Interests, impairment gains
or losses, and gains and losses on foreign exchange that calculated using effective interest method
shall be included into profit or loss, while other gains or losses are included into other
comprehensive income. Accumulated gains or losses that initially recognized as other
comprehensive income should be transferred out into profit or loss when the financial assets are
derecognized.
3) Equity instrument investments at fair value through other comprehensive income
The Company measures its equity instrument investments at fair value. Dividends obtained (other
than those as part of investment cost recovery) shall be included into profit or loss, while other
gains or losses are included into other comprehensive income. Accumulated gains or losses that
initially recognized as other comprehensive income should be transferred out into retained
earnings when the financial assets are derecognized.
4) Financial assets at fair value through profit or loss
135
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
The Company measures its financial assets at fair value. Gains or losses arising from changes in
fair value (including interests and dividends) shall be included into profit or loss, except for
financial assets that are part of hedging relationships.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include held-for-trading financial liabilities
(including derivatives that are liabilities) and financial liabilities designated as at fair value
through profit or loss. The Company measures such kind of liabilities at fair value. The amount of
changes in the fair value of the financial liabilities that are attributable to changes in the
Company’s own credit risk shall be included into other comprehensive income, unless such
treatment would create or enlarge accounting mismatches in profit or loss. Other gains or losses on
those financial liabilities (including interests, changes in fair value that are attributable to reasons
other than changes in the Company’s own credit risk) shall be included into profit or loss, except
for financial liabilities that are part of hedging relationships. Accumulated gains or losses that
originally recognized as other comprehensive income should be transferred out into retained
earnings when the financial liabilities are derecognized.
2) Financial liabilities that arise when a transfer of a financial asset does not qualify for
derecognition or when the continuing involvement approach applies
The Company measures its financial liabilities in accordance with ―CASBE 23 – Transfer of
Financial Assets‖.
3) Financial guarantee contracts not fall within the above categories 1) and 2), and commitments
to provide a loan at a below-market interest rate, which do not fall within the above category 1)
The Company measures its financial liabilities at the higher of: a. the amount of loss allowances in
accordance with impairment requirements of financial instruments; b. the amount initially
recognized less the amount of accumulated amortization recognized in accordance with ―CASBE
14 – Revenues‖.
4) Financial liabilities at amortized cost
The Company measures its financial liabilities at amortized cost using effective interest method.
Gains or losses on financial liabilities that are measured at amortized cost and are not part of
hedging relationships shall be included into profit or loss when the financial liabilities are
derecognized and amortized using effective interest method.
(4) Derecognition of financial assets and financial liabilities
1) Financial assets are derecognized when:
a. the contractual rights to the cash flows from the financial assets expire; or
b. the financial assets have been transferred and the transfer qualifies for derecognition in accordance with
―CASBE 23 – Transfer of Financial Assets‖.
136
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2) Only when the underlying present obligations of a financial liability are relieved totally or partly may the
financial liability be derecognized accordingly.
3. Recognition criteria and measurement method of financial assets transfer
Where the Company has transferred substantially all of the risks and rewards related to the
ownership of the financial asset, it derecognizes the financial asset, and any right or liability
arising from such transfer is recognized independently as an asset or a liability. If it retained
substantially all of the risks and rewards related to the ownership of the financial asset, it
continues recognizing the financial asset. Where the Company does not transfer or retain
substantially all of the risks and rewards related to the ownership of a financial asset, it is dealt
with according to the circumstances as follows respectively: (1) if the Company does not retain its
control over the financial asset, it derecognizes the financial asset, and any right or liability arising
from such transfer is recognized independently as an asset or a liability; (2) if the Company retains
its control over the financial asset, according to the extent of its continuing involvement in the
transferred financial asset, it recognizes the related financial asset and recognizes the relevant
liability accordingly.
If the transfer of an entire financial asset satisfies the conditions for derecognition, the difference
between the amounts of the following two items are included in profit or loss: (1) the carrying
amount of the transferred financial asset as of the date of derecognition; (2) the sum of
consideration received from the transfer of the financial asset, and the accumulative amount of the
changes of the fair value originally included in other comprehensive income proportionate to the
transferred financial asset (financial assets transferred refer to debt instrument investments at fair
value through other comprehensive income). If the transfer of financial asset partially satisfies the
conditions to derecognition, the entire carrying amount of the transferred financial asset is,
between the portion which is derecognized and the portion which is not, apportioned according to
their respective relative fair value, and the difference between the amounts of the following two
items are included into profit or loss: (1) the carrying amount of the portion which is derecognized;
(2) the sum of consideration of the portion which is derecognized, and the portion of the
accumulative amount of the changes in the fair value originally included in other comprehensive
income which is corresponding to the portion which is derecognized (financial assets transferred
refer to debt instrument investments at fair value through other comprehensive income).
4. Fair value determination method of financial assets and liabilities
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value. The inputs to valuation techniques used to measure fair value are arranged in the
following hierarchy and used accordingly:
(1) Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company
can access at the measurement date.
(2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly or indirectly. Level 2 inputs include: quoted prices for similar assets or liabilities in active
137
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than
quoted prices that are observable for the asset or liability, for example, interest rates and yield curves observable at
commonly quoted intervals; market-corroborated inputs;
(3) Level 3 inputs are unobservable inputs for the asset or liability. Level 3 inputs include interest rate that is not
observable and cannot be corroborated by observable market data at commonly quoted intervals, historical
volatility, future cash flows to be paid to fulfill the disposal obligation assumed in business combination, and
financial forecast developed using the Company’s own data, etc.
5. Impairment of financial instruments
(1) Measurement and accounting treatment
The Company, on the basis of expected credit loss, recognizes loss allowances of financial assets at amortized cost,
debt instrument investments, contract assets or leases receivable at fair value through other comprehensive income,
loan commitments other than financial liabilities at fair value through profit or loss, financial guarantee contracts
not belong to financial liabilities at fair value through profit or loss or financial liabilities that arise when a transfer
of a financial asset does not qualify for derecognition or when the continuing involvement approach applies.
Expected credit losses refer to the weighted average of credit losses with the respective risks of a default occurring
as the weights. Credit loss refers to the difference between all contractual cash flows that are due to the Company
in accordance with the contract and all the cash flows that the Company expects to receive (i.e. all cash shortfalls),
discounted at the original effective interest rate. Among which, purchased or originated credit-impaired financial
assets are discounted at the credit-adjusted effective interest rate.
At the balance sheet date, the Company shall only recognize the cumulative changes in the lifetime expected credit
losses since initial recognition as a loss allowance for purchased or originated credit-impaired financial assets.
For accounts receivable and contract assets that do not contain a significant financing component or financing
components in contracts with associated period less than one year that are not considered by the Company, which
result from transactions as regulated in ―CASBE 14 – Revenues‖, the Company chooses simplified approach to
measure the loss allowance at an amount equal to lifetime expected credit losses.
For lease receivables, accounts receivable and contract assets that result from transactions as regulated in ―CASBE
14 – Revenues‖ and contain a significant financing component, the Company chooses simplified approach to
measure the loss allowance at an amount equal to lifetime expected credit losses.
For financial assets other than the above, on each balance sheet date, the Company shall assess whether the credit
risk on the financial instrument has increased significantly since initial recognition. The Company shall measure
the loss allowance for the financial instrument at an amount equal to the lifetime expected credit losses if the credit
risk on that financial instrument has increased significantly since initial recognition; otherwise, the Company shall
measure the loss allowance for that financial instrument at an amount equal to 12-month expected credit loss.
Considering reasonable and supportable forward-looking information, the Company compares the risk of a default
occurring on the financial instrument as at the balance sheet date with the risk of a default occurring on the
financial instrument as at the date of initial recognition, so as to assess whether the credit risk on the financial
instrument has increased significantly since initial recognition.
The Company may assume that the credit risk on a financial instrument has not increased significantly since initial
recognition if the financial instrument is determined to have relatively low credit risk at the balance sheet date.
The Company shall estimate expected credit risk and measure expected credit losses on an individual or a
138
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
collective basis. When the Company adopts the collective basis, financial instruments are grouped with similar
credit risk features.
The Company shall remeasure expected credit loss on each balance sheet date, and increased or reversed amounts
of loss allowance arising therefrom shall be included into profit or loss as impairment losses or gains. For a
financial asset measured at amortized cost, the loss allowance reduces the carrying amount of such financial asset
presented in the balance sheet; for a debt investment measured at fair value through other comprehensive income,
the loss allowance shall be recognized in other comprehensive income and shall not reduce the carrying amount of
such financial asset.
(2) Financial instruments with expected credit risk assessed and expected credit losses measured on a collective
basis
Items Basis for determination of Method for measuring expected
portfolio credit loss
Other receivables – Portfolio grouped with Based on historical credit loss
consolidated related parties experience, the current situation
Other receivables – Portfolio grouped with and the forecast of future
deposit receivables Nature of receivables economic conditions, calculate
expected credit loss through
Other receivables – Portfolio grouped with
exposure at default and 12-month
export tax rebate
or lifetime expected credit loss
Other receivables – Other portfolio rate.
(3) Accounts receivable and contract assets with expected credit losses measured on a collective basis
1) Specific portfolios and method for measuring expected credit loss
Items Basis for determination of Method for measuring expected credit loss
portfolio
Bank acceptance receivable Based on historical credit loss experience,
the current situation and the forecast of
Type of notes future economic conditions, calculate
Trade acceptance receivable expected credit loss through exposure at
default and lifetime expected credit loss
rate.
Based on historical credit loss experience,
Accounts receivable –Portfolio the current situation and the forecast of
future economic conditions, prepare the
grouped with consolidated related Consolidated related parties comparison table of overdue ages and
parties lifetime expected credit loss rate of accounts
receivable, so as to calculate expected credit
loss.
Based on historical credit loss experience,
the current situation and the forecast of
Accounts receivable – Portfolio
Aging future economic conditions, calculate
Aging expected credit loss through aging of
receivables and lifetime expected credit loss
rate.
2) Accounts receivable – comparison table of ages and lifetime expected credit loss rate of portfolio grouped with
ages
Ages Expected credit loss rate (%)
Within 1 year (inclusive, the same hereinafter) 1.00
1-2 years 5.00
2-3 years 10.00
139
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
3-4 years 30.00
4-5 years 50.00
Over 5 years 100.00
6. Offsetting financial assets and financial liabilities
Financial assets and financial liabilities are presented separately in the balance sheet and are not offset. However,
the Company offsets a financial asset and a financial liability and presents the net amount in the balance sheet
when, and only when, the Company: (a) currently has a legally enforceable right to set off the recognized amounts;
and (b) intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.
For a transfer of a financial asset that does not qualify for derecognition, the Company does not offset the
transferred asset and the associated liability.
(XI) Inventories
1. Classification of inventories
Inventories include finished goods or goods held for sale in the ordinary course of business, work in process in the
process of production, and materials or supplies etc. to be consumed in the production process or in the rendering
of services.
2. Accounting method for dispatching inventories:
Inventories dispatched from storage are accounted for with weighted average method.
3. Basis for determining net realizable value
At the balance sheet date, inventories are measured at the lower of cost and net realizable value; provisions for
inventory write-down are made on the excess of its cost over the net realizable value. The net realizable value of
inventories held for sale is determined based on the amount of the estimated selling price less the estimated selling
expenses and relevant taxes and surcharges in the ordinary course of business; the net realizable value of materials
to be processed is determined based on the amount of the estimated selling price less the estimated costs of
completion, selling expenses and relevant taxes and surcharges in the ordinary course of business; at the balance
sheet date, when only part of the same item of inventories have agreed price, their net realizable value is
determined separately and is compared with their costs to set the provision for inventory write-down to be made or
reversed.
4. Inventory system
Perpetual inventory method is adopted.
5. Amortization method of low-value consumables and packages
(1) Low-value consumables
Low-value consumables are amortized with one-off method.
(2) Packages
Packages are amortized with one-off method.
(XII) Contract costs
Assets related to contract costs including costs of obtaining a contract and costs to fulfil a contract.
The Company recognizes as an asset the incremental costs of obtaining a contract if those costs are expected to be
recovered.
140
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
If the costs incurred in fulfilling a contract are not within the scope of standards related to inventories, fixed assets
or intangible assets, etc., the Company shall recognize the costs to fulfil a contract as an asset if all the following
criteria are satisfied:
1. The costs relate directly to a contract or to an anticipated contract, including direct labor, direct materials,
manufacturing overhead cost (or similar cost), cost that are explicitly chargeable to the customer under the contract,
and other costs that are only related to the contract;
2. The costs enhance resources of the Company that will be used in satisfying performance obligations in the future;
and
3. The costs are expected to be recovered.
An asset related to contract costs shall be amortized on a systematic basis that is consistent with related goods or
services, with amortization included into profit or loss.
The Company shall make provision for impairment and recognize an impairment loss to the extent that the
carrying amount of an asset related to contract costs exceeds the remaining amount of consideration that the
Company expects to receive in exchange for the goods or services to which the asset relates less the costs expected
to be incurred. The Company shall recognize a reversal of an impairment loss previously recognized in profit or
loss when the impairment conditions no longer exist or have improved. The carrying amount of the asset after the
reversal shall not exceed the amount that would have been determined on the reversal date if no provision for
impairment had been made previously.
(XIII) Non-current assets or disposal groups classified as held for sale
1. Classification of non-current assets or disposal groups as held for sale
Non-current assets or disposal groups are accounted for as held for sale when the following conditions are all met:
a. the asset must be available for immediate sale in its present condition subject to terms that are usual and
customary for sales of such assets or disposal groups; b. its sales must be highly probable, i.e., the Company has
made a decision on the sale plan and has obtained a firm purchase commitment, and the sale is expected to be
completed within one year.
When the Company acquires a non-current asset or disposal group with a view to resale, it shall classify the
non-current asset or disposal group as held for sale at the acquisition date only if the requirement of ―expected to
be completed within one year‖ is met at that date and it is highly probable that other criteria for held for sale will
be met within a short period (usually within three months).
An asset or a disposal group is still accounted for as held for sale when the Company remains committed to its plan
to sell the asset or disposal group in the circumstance that non-related party transactions fail to be completed
within one year due to one of the following reasons: a. a buyer or others unexpectedly set conditions that will
extend the sale period, while the Company has taken timely actions to respond to the conditions and expects a
favorable resolution of the delaying factors within one year since the setting; (2) a non-current asset or disposal
group classified as held for sale fails to be sold within one year due to rare cases, and the Company has taken
action necessary to respond to the circumstances during the initial one-year period and the criteria for held for sale
are met.
2. Measurement of non-current assets or disposal groups as held for sale
(1) Initial measurement and subsequent measurement
For initial measurement and subsequent measurement as at the balance sheet date of a non-current asset or disposal
141
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
group as held for sale, where the carrying amount is higher than the fair value less costs to sell, the carrying
amount is written down to the fair value less costs to sell, and the write-down is recognized in profit or loss as
assets impairment loss, meanwhile, provision for impairment of assets as held for sale shall be made.
For a non-current asset or disposal group classified as held for sale at the acquisition date, the asset or disposal
group is measured on initial recognition at the lower of its initial measurement amount had it not been so classified
and fair value less costs to sell. Apart from the non-current asset or disposal group acquired through business
combination, the difference arising from the initial recognition of a non-current asset or disposal group at the fair
value less costs to sell shall be included into profit or loss.
The assets impairment loss recognized for a disposal group as held for sale shall reduce the carrying amount of
goodwill in the disposal group first, and then reduce its carrying amount based on the proportion of each
non-current asset’s carrying amount in the disposal group.
No provision for depreciation or amortization shall be made on non-current assets as held for sale or non-current
assets in disposal groups as held for sale, while interest and other expenses attributable to the liabilities of a
disposal group as held for sale shall continue to be recognized.
(2) Reversal of assets impairment loss
When there is a subsequent increase in fair value less costs to sell of a non-current asset as held for sale at the
balance sheet date, the write-down shall be recovered, and shall be reversed not in excess of the impairment loss
that has been recognized after the non-current asset was classified as held for sale. The reversal shall be included
into profit or loss. Assets impairment loss that has been recognized before the classification is not reversed.
When there is a subsequent increase in fair value less costs to sell of a disposal group as held for sale at the balance
sheet date, the write-down shall be recovered, and shall be reversed not in excess of the non-current assets
impairment loss that has been recognized after the disposal group was classified as held for sale. The reversal shall
be included into profit or loss. The reduced carrying amount of goodwill and non-current assets impairment loss
that has been recognized before the classification is not reversed.
For the subsequent reversal of the impairment loss that has been recognized in a disposal group as held for sale, the
carrying amount is increased based on the proportion of carrying amount of each non-current asset (excluding
goodwill) in the disposal group.
(3) Non-current asset or disposal group that is no longer classified as held for sale and derecognized
A non-current asset or disposal group that does not met criteria for held for sale and no longer classified as held for
sale, or a non-current asset that removed from a disposal group as held for sale shall be measured at the lower of: a.
its carrying amount before it was classified as held for sale, adjusted for any depreciation, amortization or
impairment that would have been recognized had it not been classified as held for sale; and b. its recoverable
amount.
When a non-current asset or disposal group classified as held for sale is derecognized, unrecognized gains or losses
shall be included into profit or loss.
(XIV) Long-term equity investments
1. Judgment of joint control and significant influence
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions
about the relevant activities require the unanimous consent of the parties sharing control. Significant influence is
the power to participate in the financial and operating policy decisions of the investee but is not control or joint
142
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
control of these policies.
2. Determination of investment cost
(1) For business combination under common control, if the consideration of the combining party is that it makes
payment in cash, transfers non-cash assets, assumes its liabilities or issues equity securities, on the date of
combination, it regards the share of the carrying amount of the equity of the combined party included in the
consolidated financial statements of the ultimate controlling party as the initial cost of the investment. The
difference between the initial cost of the long-term equity investments and the carrying amount of the combination
consideration paid or the par value of shares issued offsets capital reserve; if the balance of capital reserve is
insufficient to offset, any excess is adjusted to retained earnings.
When long-term equity investments are obtained through business combination under common control achieved in
stages, the Company determines whether it is a ―bundled transaction‖. If it is a ―bundled transaction‖, stages as a
whole are considered as one transaction in accounting treatment. If it is not a ―bundled transaction‖, on the date of
combination, investment cost is initially recognized at the share of the carrying amount of net assets of the
combined party included the consolidated financial statements of the ultimate controlling party. The difference
between the initial investment cost of long-term equity investments at the acquisition date and the carrying amount
of the previously held long-term equity investments plus the carrying amount of the consideration paid for the
newly acquired equity is adjusted to capital reserve; if the balance of capital reserve is insufficient to offset, any
excess is adjusted to retained earnings.
(2) For business combination not under common control, investment cost is initially recognized at the
acquisition-date fair value of considerations paid.
When long-term equity investments are obtained through business combination not under common control
achieved in stages, the Company determined whether they are stand-alone financial statements or consolidated
financial statements in accounting treatment:
1) In the case of stand-alone financial statements, investment cost is initially recognized at the carrying amount of
the previously held long-term equity investments plus the carrying amount of the consideration paid for the newly
acquired equity.
2) In the case of consolidated financial statements, the Company determines whether it is a ―bundled transaction‖.
If it is a ―bundled transaction‖, stages as a whole are considered as one transaction in accounting treatment. If it is
not a ―bundled transaction‖, the carrying amount of the acquirer’s previously held equity interest in the acquiree is
remeasured at the acquisition-date fair value, and the difference between the fair value and the carrying amount is
recognized in investment income; when the acquirer’s previously held equity interest in the acquiree involves other
comprehensive income under equity method, the related other comprehensive income is reclassified as income for
the acquisition period, excluding other comprehensive income arising from changes in net liabilities or assets from
remeasurement of defined benefit plan of the acquiree.
(3) Long-term equity investments obtained through ways other than business combination: the initial cost of a
long-term equity investment obtained by making payment in cash is the purchase cost which is actually paid; that
obtained on the basis of issuing equity securities is the fair value of the equity securities issued; that obtained
through debt restructuring is determined according to ―CASBE 12 – Debt Restructuring‖; and that obtained
through non-cash assets exchange is determined according to ―CASBE 7 – Non-cash Assets Exchange‖.
3. Subsequent measurement and recognition method of profit or loss
For long-term equity investments with control relationship, it is accounted for with cost method; for long-term
143
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
equity investments with joint control or significant influence relationship, it is accounted for with equity method.
4. Disposal of a subsidiary in stages resulting in the Company’s loss of control
(1) Stand-alone financial statements
The difference between the carrying amount of the disposed equity and the consideration obtained thereof is
recognized in profit or loss. If the disposal does not result in the Company’s loss of significant influence or joint
control, the remained equity is accounted for with equity method; however, if the disposal results in the Company’s
loss of control, joint control, or significant influence, the remained equity is accounted for according to ―CASBE
22 – Financial Instruments: Recognition and Measurement‖.
(2) Consolidated financial statements
1) Disposal of a subsidiary in stages not qualified as ―bundled transaction‖ resulting in the Company’s loss of
control
Before the Company’s loss of control, the difference between the disposal consideration and the proportionate
share of net assets in the disposed subsidiary from acquisition date or combination date to the disposal date is
adjusted to capital reserve (capital premium), if the balance of capital reserve is insufficient to offset, any excess is
adjusted to retained earnings.
When the Company loses control, the remained equity is remeasured at the loss-of-control-date fair value. The
aggregated value of disposal consideration and the fair value of the remained equity, less the share of net assets in
the disposed subsidiary held before the disposal from the acquisition date or combination date to the disposal date
is recognized in investment income in the period when the Company loses control over such subsidiary, and
meanwhile goodwill is offset correspondingly. Other comprehensive income related to equity investments in
former subsidiary is reclassified as investment income upon the Company’s loss of control.
2) Disposal of a subsidiary in stages qualified as ―bundled transaction‖ resulting in the Company’s loss of control
In case of ―bundled transaction‖, stages as a whole are considered as one transaction resulting in loss of control in
accounting treatment. However, before the Company loses control, the difference between the disposal
consideration at each stage and the proportionate share of net assets in the disposed subsidiary is recognized as
other comprehensive income at the consolidated financial statements and reclassified as profit or loss in the period
when the Company loses control over such subsidiary.
(XV) Investment property
1. Investment property includes land use right of leased-out property and of property held for capital appreciation
and buildings that have been leased out.
2. The initial measurement of investment property is based on its cost, and subsequent measurement is made using
the cost model, the depreciation or amortization method is the same as that of fixed assets and intangible assets.
(XVI) Fixed assets
1. Recognition principles of fixed assets
Fixed assets are tangible assets held for use in the production of goods or rendering of services, for rental to others,
or for administrative purposes, and expected to be used during more than one accounting year. Fixed assets are
recognized if, and only if, it is probable that future economic benefits associated with the assets will flow to the
Company and the cost of the assets can be measured reliably.
2. Depreciation method of different categories of fixed assets
144
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Estimated residual Annual
Categories Useful life
Depreciation method value proportion depreciation
(years)
(%) rate (%)
Buildings and structures Straight-line method 15-35 3.00 2.77-6.47
Machinery Straight-line method 10-15 3.00 6.47-9.70
Transport facilities Straight-line method 6-8 3.00 12.13-16.17
Electronic equipment Straight-line method 4-11 3.00 8.82-24.25
Other equipment Straight-line method 4-11 3.00 8.82-24.25
3. Initial recognition, measurement and depreciation of finance leases
If any of five tests are meet, the lease is considered as a finance lease:1）Ownership of the asset is transferred to the
lessee at the end of the lease term；2）The lease contains a bargain purchase option to buy the equipment at less
than fair market value；3）The lease term is for a major part of the economic life of the asset even if title is not
transferred; 4）At the inception of the lease the present value of the minimum lease payments amounts to at least
substantially all of the fair value of the leased asset；5）The leased assets are of a specialized nature such that only
the lessee can use them without major modifications being made.
At the commencement of the lease term, lessees shall recognize finance leases as assets in their statements of
financial position at amounts equal to the fair value of the leased property or, if lower, the present value of the
minimum lease payments, each determined at the inception of the lease. The minimum lease payments recognize
as long-term liability, the variance shall be recognized as unrecognized financing charges. Initial direct costs are
often incurred in connection with specific leasing activities, such as negotiating and securing leasing arrangements.
The costs identified as directly attributable to activities performed by the lessee for a finance lease are added to the
amount recognized as an asset. Unrecognized financing charges are amortized using effective interest rate in each
accounting period during the lease term.
The depreciation policy for depreciable leased assets of the Company is consistent with that for depreciable assets
that are owned. If there is no reasonable certainty that the lessee will obtain ownership by the end of the lease term,
the asset shall be fully depreciated over the shorter of the lease term and its useful life.
(XVII) Construction in progress
1. Construction in progress is recognized if, and only if, it is probable that future economic benefits associated with
the item will flow to the Company, and the cost of the item can be measured reliably. Construction in progress is
measured at the actual cost incurred to reach its designed usable conditions.
2. Construction in progress is transferred into fixed assets at its actual cost when it reaches the designed usable
conditions. When the auditing of the construction in progress was not finished while reaching the designed usable
conditions, it is transferred to fixed assets using estimated value first, and then adjusted accordingly when the
actual cost is settled, but the accumulated depreciation is not to be adjusted retrospectively.
(XVIII) Intangible assets
1. Intangible assets include land use right, patent right and non-patented technology etc. The initial measurement of
intangible assets is based on its cost.
2. For intangible assets with finite useful lives, their amortization amounts are amortized within their useful lives
systematically and reasonably, if it is unable to determine the expected realization pattern reliably, intangible assets
145
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
are amortized by the straight-line method with details as follows:
Items Amortization period (years)
Software 3-10
patent right and non-patented technology 5-10
land use right 40-50
3. Expenditures on the research phase of an internal project are recognized as profit or loss when they are incurred.
An intangible asset arising from the development phase of an internal project is recognized if the Company can
demonstrate all of the followings: (1) the technical feasibility of completing the intangible asset so that it will be
available for use or sale; (2) its intention to complete the intangible asset and use or sell it; (3) how the intangible
asset will generate probable future economic benefits, among other things, the Company can demonstrate the
existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used
internally, the usefulness of the intangible asset; (4) the availability of adequate technical, financial and other
resources to complete the development and to use or sell the intangible asset; and (5) its ability to measure reliably
the expenditure attributable to the intangible asset during its development.
(XIX) Impairment of part of long-term assets
For long-term assets such as long-term equity investments, investment property at cost model,
fixed assets, construction in progress, productive biological assets at cost model, oil and gas assets,
right-of-use assets, intangible assets with finite useful lives, etc., if at the balance sheet date there
is indication of impairment, the recoverable amount is to be estimated. For goodwill recognized in
business combination and intangible assets with indefinite useful lives, no matter whether there is
indication of impairment, impairment test is performed annually. Impairment test on goodwill is
performed on related asset group or asset group portfolio.
When the recoverable amount of such long-term assets is lower than their carrying amount, the difference is
recognized as provision for assets impairment through profit or loss.
(XX) Long-term prepayments
Long-term prepayments are expenses that have been recognized but with amortization period over one year
(excluding one year). They are recorded with actual cost, and evenly amortized within the beneficiary period or
stipulated period. If items of long-term prepayments fail to be beneficial to the following accounting periods,
residual values of such items are included in profit or loss.
(XXI) Employee benefits
1.Employee benefits include short-term employee benefits, post-employment benefits, termination benefits and
other long-term employee benefits.
2. Short-term employee benefits
The Company recognizes, in the accounting period in which an employee provides service, short-term employee
benefits actually incurred as liabilities, with a corresponding charge to profit or loss or the cost of a relevant asset.
3. Post-employment benefits
The Company classifies post-employment benefit plans as either defined contribution plans or defined benefit
plans.
146
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(1) The Company recognizes in the accounting period in which an employee provides service the contribution
payable to a defined contribution plan as a liability, with a corresponding charge to profit or loss or the cost of a
relevant asset.
(2) Accounting treatment by the Company for defined benefit plan usually involves the following steps:
1) In accordance with the projected unit credit method, using unbiased and mutually compatible actuarial
assumptions to estimate related demographic variables and financial variables, measure the obligations under the
defined benefit plan, and determine the periods to which the obligations are attributed. Meanwhile, the Company
discounts obligations under the defined benefit plan to determine the present value of the defined benefit plan
obligations and the current service cost;
2) When a defined benefit plan has assets, the Company recognizes the deficit or surplus by deducting the fair
value of defined benefit plan assets from the present value of the defined benefit plan obligation as a net defined
benefit plan liability or net defined benefit plan asset. When a defined benefit plan has a surplus, the Company
measures the net defined benefit plan asset at the lower of the surplus in the defined benefit plan and the asset
ceiling;
3) At the end of the period, the Company recognizes the following components of employee benefits cost arising
from defined benefit plan: a. service cost; b. net interest on the net defined benefit plan liability (asset); and c.
changes as a result of remeasurement of the net defined benefit liability (asset). Item a and item b are recognized in
profit or loss or the cost of a relevant asset. Item c is recognized in other comprehensive income and is not to be
reclassified subsequently to profit or loss. However, the Company may transfer those amounts recognized in other
comprehensive income within equity.
4. Termination benefits
Termination benefits provided to employees are recognized as an employee benefit liability for termination
benefits, with a corresponding charge to profit or loss at the earlier of the following dates: a. when the Company
cannot unilaterally withdraw the offer of termination benefits because of an employment termination plan or a
curtailment proposal; or b. when the Company recognizes cost or expenses related to a restructuring that involves
the payment of termination benefits.
5. Other long-term employee benefits
When other long-term employee benefits provided to the employees satisfied the conditions for classifying as a
defined contribution plan, those benefits are accounted for in accordance with the requirements relating to defined
contribution plan, while other benefits are accounted for in accordance with the requirements relating to defined
benefit plan. The Company recognizes the cost of employee benefits arising from other long-term employee
benefits as the followings: a. service cost; b. net interest on the net liability or net assets of other long-term
employee benefits; and c. changes as a result of remeasurement of the net liability or net assets of other long-term
employee benefits. As a practical expedient, the net total of the aforesaid amounts is recognized in profit or loss or
included in the cost of a relevant asset.
(XXII) Provisions
1. Provisions are recognized when fulfilling the present obligations arising from contingencies
such as providing guarantee for other parties, litigation, products quality guarantee, onerous
contract, etc., may cause the outflow of the economic benefit and such obligations can be reliably
measured.
147
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2. The initial measurement of provisions is based on the best estimated expenditures required in
fulfilling the present obligations, and its carrying amount is reviewed at the balance sheet date.
(XXIII) Revenue
1. Revenue recognition principles
At contract inception, the Company shall assess the contracts and shall identify each performance
obligation in the contracts, and determine whether the performance obligation should be satisfied
over time or at a point in time.
The Company satisfies a performance obligation over time if one of the following criteria is met,
otherwise, the performance obligation is satisfied at a point in time: (1) the customer
simultaneously receives and consumes the economic benefits provided by the Company’s
performance as the Company performs; (2) the customer can control goods as they are created by
the Company’s performance; (3) goods created during the Company’s performance have
irreplaceable uses and the Company has an enforceable right to receive the payments for
performance completed to date during the whole contract period.
For each performance obligation satisfied over time, the Company shall recognize revenue over
time by measuring the progress towards complete satisfaction of that performance obligation. In
the circumstance that the progress cannot be measured reasonably, but the costs incurred in
satisfying the performance obligation are expected to be recovered, the Company shall recognize
revenue only to the extent of the costs incurred until it can reasonably measure the progress. For
each performance obligation satisfied at a point in time, the Company shall recognize revenue at
the time point that the client obtains control of relevant goods or services. To determine whether
the customer has obtained control of goods, the Company shall consider the following indications:
(1) the Company has a present right to payment for the goods, i.e., the customer is presently
obliged to pay for the goods; (2) the Company has transferred the legal title of the goods to the
customer, i.e., the customer has legal title to the goods; (3) the Company has transferred physical
possession of the goods to the client, i.e., the customer has physically possessed the goods; (4) the
Company has transferred significant risks and rewards of ownership of the goods to the client, i.e.,
the customer has obtained significant risks and rewards of ownership of the goods; (5) the
customer has accepted the goods; (6) other evidence indicating the customer has obtained control
over the goods.
2. Revenue measurement principle
(1) Revenue is measured at the amount of the transaction price that is allocated to each
performance obligation. The transaction price is the amount of consideration to which the
Company expects to be entitled in exchange for transferring goods or services to a customer,
excluding amounts collected on behalf of third parties and those expected to be refunded to the
customer.
148
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(2) If the consideration promised in a contract includes a variable amount, the Company shall
confirm the best estimate of variable consideration at expected value or the most likely amount.
However, the transaction price that includes the amount of variable consideration only to the
extent that it is high probable that a significant reversal in the amount of cumulative revenue
recognized will not occur when the uncertainty associated with the variable consideration is
subsequently resolved.
(3) In the circumstance that the contract contains a significant financing component, the Company
shall determine the transaction price based on the price that a customer would have paid for if the
customer had paid cash for obtaining control over those goods or services. The difference between
the transaction price and the amount of promised consideration is amortized under effective
interest method over contractual period. The effects of a significant financing component shall not
be considered if the Company expects, at the contract inception, that the period between when the
customer obtains control over goods or services and when the customer pays consideration will be
one year or less.
(4) For contracts containing two or more performance obligations, the Company shall determine
the stand-alone selling price at contract inception of the distinct good underlying each
performance obligation and allocate the transaction price to each performance obligation on a
relative stand-alone selling price basis.
3. Revenue recognition method
The Company’s main product is the Video conference products, integrated wiring products, low
voltage distribution products, wiring products and other products. The above-mentioned product
sales business of the company belongs to the performance obligation performed at a certain time
point, and the revenue is recognized when the customer collects, has collected the price or
obtained the right to collect and the relevant economic benefits are likely to flow in.
(XXIV) Government grants
1. Government grants shall be recognized if, and only if, the following conditions are all met: (1) the Company
will comply with the conditions attaching to the grants; (2) the grants will be received. Monetary government
grants are measured at the amount received or receivable. Non-monetary government grants are measured at fair
value, and can be measured at nominal amount in the circumstance that fair value cannot be assessed.
2. Government grants related to assets
Government grants related to assets are government grants with which the Company constructs or otherwise
acquires long-term assets under requirements of government. In the circumstances that there is no specific
government requirement, the Company shall determine based on the primary condition to acquire the grants, and
government grants related to assets are government grants whose primary condition is to construct or otherwise
acquire long-term assets. They offset carrying amount of relevant assets, or they are recognized as deferred income.
If recognized as deferred income, they are included in profit or loss on a systematic basis over the useful lives of
the relevant assets. Those measured at notional amount are directly included into profit or loss. For assets sold,
transferred, disposed or damaged within the useful lives, balance of unamortized deferred income is transferred
149
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
into profit or loss of the period in which the disposal occurred.
3. Government grants related to income
Government grants related to income are government grants other than those related to assets. For government
grants that contain both parts related to assets and parts related to income, in which those two parts are blurred,
they are thus collectively classified as government grants related to income. For government grants related to
income used for compensating the related future cost, expenses or losses, they are recognized as deferred income
and included in profit or loss or used to offset relevant cost during the period in which the relevant cost, expenses
or losses are recognized; for government grants related to income used for compensating the related cost, expenses
or losses incurred to the Company, they are directly included in profit or loss or used to offset relevant cost.
4. Government grants related to the ordinary course of business shall be included into other
income or used to offset relevant cost based on business nature, while those not related to the
ordinary course of business shall be included into non-operating revenue or expenditures.
(XXV) Contract assets, contract liabilities
The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between
its performance obligations and customers’ payments. Contract assets and contract liabilities under the same
contract shall offset each other and be presented on a net basis.
The Company presents an unconditional right to consideration (i.e., only the passage of time is required before the
consideration is due) as a receivable, and presents a right to consideration in exchange for goods that it has
transferred to a customer (which is conditional on something other than the passage of time) as a contract asset.
The Company presents an obligation to transfer goods to a customer for which the Company has received
consideration (or the amount is due) from the customer as a contract liability.
(XXVI) Deferred income tax assets and liabilities
1. Deferred tax assets or deferred tax liabilities are calculated and recognized based on the
difference between the carrying amount and tax base of assets and liabilities (and the difference of
the carrying amount and tax base of items not recognized as assets and liabilities but with their tax
base being able to be determined according to tax laws) and in accordance with the tax rate
applicable to the period during which the assets are expected to be recovered or the liabilities are
expected to be settled.
2. A deferred tax asset is recognized to the extent of the amount of the taxable income, which it is
most likely to obtain and which can be deducted from the deductible temporary difference. At the
balance sheet date, if there is any exact evidence that it is probable that future taxable income will
be available against which deductible temporary differences can be utilized, the deferred tax assets
unrecognized in prior periods are recognized.
3. At the balance sheet date, the carrying amount of deferred tax assets is reviewed. The carrying
amount of a deferred tax asset is reduced to the extent that it is no longer probable that sufficient
taxable income will be available to allow the benefit of the deferred tax asset to be utilized. Such
reduction is subsequently reversed to the extent that it becomes probable that sufficient taxable
150
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
income will be available.
4. The income tax and deferred tax for the period are treated as income tax expenses or income
through profit or loss, excluding those arising from the following circumstances: (a) business
combination; and (b) the transactions or items directly recognized in equity.
(XXVII) Leases
1. Company as lessee
On the start date of the lease period, the company recognizes leases with a lease term not
exceeding 12 months and no purchase option as short-term leases; leases with lower value when a
single leased asset is a brand-new asset is recognized as a low-value asset lease. If the company
subleases or expects to sublease the leased assets, the original lease is not recognized as a
low-value asset lease.
For all short-term leases and leases of low-value assets, the company charges the lease payments
to the cost of the relevant asset or current profit and loss on a straight-line basis over each period
of the lease term.
Except for the above-mentioned short-term leases and low-value asset leases that adopt simplified
treatment, on the commencement date of the lease period, the company recognizes the right-of-use
assets and lease liabilities for the leases.
(1) Right-of-use asset
The right-of-use asset is initially measured at cost, which includes: 1) the initial measurement
amount of the lease liability; 2) the lease payments made on or before the start date of the lease
term, if there is a lease incentive, deduct the amount of the lease incentive already enjoyed ; 3)
Initial direct costs incurred by the lessee; 4) The lessee is expected to incur costs to dismantle and
remove the leased asset, restore the site where the leased asset is located, or restore the leased
asset to the state agreed upon in the lease terms.
The company depreciates right-of-use assets on a straight-line basis. If it can be reasonably
determined that the ownership of the leased asset will be obtained at the expiration of the lease
term, the company shall accrue depreciation over the remaining useful life of the leased asset. If it
cannot be reasonably determined that the ownership of the leased asset can be obtained when the
lease term expires, the company shall accrue depreciation within the shorter of the lease term and
the remaining useful life of the leased asset.
(2) Lease liability
On the lease commencement date, the company recognizes the present value of the outstanding
lease payments as a lease liability. When calculating the present value of lease payments, the
interest rate implicit in the lease is used as the discount rate. If the interest rate implicit in the lease
cannot be determined, the company's incremental borrowing rate is used as the discount rate. The
difference between the lease payment and its present value is regarded as the unrecognized
financing expense, and the interest expense is recognized in each period of the lease term
according to the discount rate of the present value of the confirmed lease payment, and is included
151
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
in the current profit and loss. Variable lease payments that are not included in the measurement of
lease liabilities are included in the current profit and loss when they are actually incurred.
After the commencement date of the lease term, when there is a change in the actual fixed
payment amount, a change in the estimated payable amount of the guaranteed residual value, a
change in the index or ratio used to determine the lease payment amount, the evaluation of a
purchase option, a lease renewal option or a termination option When the result or the actual
exercise situation changes, the company re-measures the lease liability according to the present
value of the changed lease payments, and adjusts the book value of the right-of-use asset
accordingly. If the book value of the right-of-use asset has been reduced to zero, but the lease If
the liabilities still need to be further reduced, the remaining amount shall be included in the current
profit and loss.
2. Company as lessor
On the lease commencement date, the company classifies leases that substantially transfer almost
all the risks and rewards related to the ownership of the leased assets as financial leases, and other
leases are operating leases.
1) Operating leases
During each period of the lease term, the company recognizes the lease receipts as rental income
on a straight-line basis. The initial direct expenses incurred are capitalized and amortized on the
same basis as the rental income recognition, and are included in the current profit and loss in
installments. The variable lease payments obtained by the company related to operating leases that
are not included in the lease receipts are included in the current profit and loss when they actually
occur.
2) Finance leases
On the commencement date of the lease period, the company shall recognize the financial lease
receivables based on the net investment in the lease (unguaranteed residual value and the lease
receipts not yet received on the commencement date of the lease term shall be based on the
interest rate(sum of discounted present value) embedded in the lease), and terminate the
recognition of financial lease assets. During each period of the lease term, the company calculates
and recognizes interest income based on the interest rate implicit in the lease.
The variable lease payments obtained by the company that are not included in the net lease
investment measurement are included in the current profit and loss when actually incurred.
3. Sale and leaseback
(1) Company as lessee
According to the "Accounting Standards for Business Enterprises No. 14 - Revenue", the company
evaluates and determines whether the asset transfer in the sale and leaseback transaction belongs
to sales.
152
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
If the asset transfer in the sale and leaseback transaction is a sale, the company shall measure the
right-of-use asset formed by the sale and leaseback based on the portion of the original book value
of the asset that is related to the use right obtained by leaseback, and shall only measure the
right-of-use asset formed by the sale and leaseback. Recognition of related gains or losses.
If the asset transfer in the sale and leaseback transaction does not belong to sales, the company
shall continue to recognize the transferred asset, recognize a financial liability equal to the transfer
income, and conduct accounting treatment for the financial liability in accordance with the
accounting standards for Business Enterprises No. 22 - recognition and measurement of financial
instruments.
(2) Company as lessor
According to the accounting standards for Business Enterprises No. 14 - income, the company
evaluates and determines whether the asset transfer in the sale and leaseback transaction belongs
to sales.
If the asset transfer in the sale and leaseback transaction belongs to sales, the company shall
conduct accounting treatment for asset purchase in accordance with other applicable accounting
standards for business enterprises, and accounting treatment for asset lease in accordance with
accounting standards for Business Enterprises No. 21 - leasing.
If the asset transfer in the sale and leaseback transaction does not belong to sales, the company
does not recognize the transferred asset, but recognizes a financial asset equal to the transfer
income, and carries out accounting treatment for the financial asset in accordance with the
accounting standards for Business Enterprises No. 22 - recognition and measurement of financial
instruments.
(XXVIII) Segment reporting
Operating segments are determined based on the structure of the Company’s internal organization, management
requirements and internal reporting system. An operating segment is a component of the Company:
(1) that engages in business activities from which it may earn revenues and incur expenses;
(2) whose financial performance is regularly reviewed by the Management to make decisions about resource to be
allocated to the segment and to assess its performance; and
(3) for which accounting information regarding financial position, financial performance and cash flows is
available through analysis.
(XXIX) Significant changes in accounting policies and estimates
Changes in accounting policies arising from changes in CASBEs
1. The company has adopted the accounting standards for Business Enterprises No. 21 - Leases (hereinafter
referred to as the new leases standards) revised by the Ministry of finance from January 1, 2021. According to the
relevant provisions on the connection between the new and old standards, the information of the comparable
period will not be adjusted, and the cumulative impact of the implementation of the new standards on the first
153
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
implementation date will retroactively adjust the amount of retained earnings and other related items in the
financial statements at the beginning of the reporting period.
(1) For contracts that existed prior to the date of initial application, the company chose not to reassess whether it
was a lease or contained a lease.
(2) For lease contracts in which the company is the lessee, the company adjusts the amount of retained earnings at
the beginning of the reporting period and other relevant items in the financial statements according to the
cumulative impact of the implementation of the new lease standards and the original standards on the date of initial
implementation, and does not adjust the information for comparable periods. The specific processing is as follows:
1) Simplified treatment of operating leases prior to the date of initial application.
2) For lease contracts completed within 12 months after the date of initial execution, the company adopts a
simplified method and does not recognize right-of-use assets and lease liabilities.
The above simplified treatment has no significant impact on the company's financial statements.
(3) For the operating lease contracts for low-value assets that existed before the date of initial application, the
company adopts a simplified method, does not recognize right-of-use assets and lease liabilities, and conducts
accounting treatment in accordance with the new lease standards from the date of initial application.
(4) For lease contracts in which the company is the lessor, accounting treatment will be carried out in accordance
with the new lease standards from the date of initial execution.
2. From January 26, 2021, the company will implement the "Interpretation of Accounting Standards for Business
Enterprises No. 14" issued by the Ministry of Finance in 2021. This accounting policy change has no impact on the
company's financial statements.
3. From December 31, 2021, the company will implement the "Accounting Standards for Business Interpretation
No. 15" "Related Presentation of Centralized Management of Funds" promulgated by the Ministry of Finance. This
accounting policy change has no impact on the company's financial statements.
IV. Taxes
(I) Main taxes and tax rates
Taxes Tax bases Tax rates
Value-added tax (VAT) The taxable revenue from sales of goods or
13%、6%、5%、3%
rendering of services
For housing property levied on the basis of price,
housing property tax is levied at the rate of 1.2% of
Housing property tax the balance after deducting 30% of the cost; for
1.2%、12%
housing property levied on the basis of rent, housing
property tax is levied at the rate of 12% of rent
revenue.
Urban maintenance and Turnover tax payable 7%
construction tax
Education surcharge Turnover tax payable 3%
Local education surcharge Turnover tax payable 2%
Enterprise income tax Taxable income 15%、16.5%、25%
Different enterprise income tax rates applicable to different taxpayers:
Taxpayers Income tax rate
The Company 25%
154
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Taxpayers Income tax rate
Nanjing Putian Changle Telecommunications 15%
Equipment Co., Ltd.
Nanjing Putian Datang Information Electronic 15%
Co., Ltd.
Putian Telecommunications (H.K.) Co., Ltd. 16.5%
Taxpayers other than the above-mentioned 25%
(II) Tax preferential policies
1. Nanjing Putian Telege Intelligent Building Ltd., obtained high-tech enterprise certificate in
November, 2021, valid for 3 years.From 2021 to 2023, the enterprise income tax shall be paid at
the reduced tax rate of 15%.
2. The subsidiary, Nanjing Putian Datang Information Electronic Co., Ltd., obtained high-tech
enterprise certificate in November, 2021, valid for 3 years. From 2021 to 2023, the enterprise
income tax shall be paid at the reduced tax rate of 15%.
3. The seventh branch of the subsidiary Nanjing communication equipment factory is a social
welfare enterprise, which complies with the provisions of Guo Shui Fa [2007] No. 067 and enjoys
the preferential tax policies of immediate collection and refund of value-added tax and plus
deduction of wages of the disabled.
4. The subsidiaries, Nanjing Putian Datang Information Electronic Co., Ltd. awere certified as
software enterprises, and some of the software products produced by Nanjing South
Telecommunications Company Limited and Nanjing Putian Network Co., Ltd. are entitled to
enjoy the preferential tax policy of VAT refund upon collection in accordance with the provisions
of Cai Shui [2011] No.100.
V. Notes to items of consolidated financial statements
Remarks: ―Opening balance‖ in the report refers to the data on January 1, 2021 after the year-end
balance of the financial statements is adjusted according to the new income standard.
(I) Notes to items of the consolidated balance sheet
1. Cash and bank balances
(1) Details
Items Closing balance Opening balance
Cash on hand 343.39 2,229.39
Cash in bank 180,458,727.47 170,060,517.48
Other cash and bank balances 8,206,459.51 39,786,964.09
Total 188,665,530.37 209,849,710.96
(2) Centralized management of funds
155
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
1) The company implements centralized and unified management of the funds of the parent
company and member units through the internal financial company.
2) Amounts and Circumstances Listed as "Money Funds"
Items Closing balance Opening balance
Funds listed as "monetary funds"
7,151,551.17
and deposited in the finance company
(3) Details of other cash and bank balances
Items Closing balance Opening balance
Bank acceptance deposit 29,219,480.00
deposit for L/G 8,205,628.07 10,428,199.34
Others 831.44 139,284.75
Total 8,206,459.51 39,786,964.09
Other cash and bank balances are restricted funds.
2. Held-for-trading financial assets
Items Closing balance Opening balance
Financial assets classified as financial assets
measured at fair value and whose changes are 20,000,000.00
included in current profits and losses
Including: Debt Instrument Investment
Debt Instrument Investment
Derivative financial assets
Others 20,000,000.00
Financial assets designated to be measured at fair
value and whose changes are included in current
profits and losses
Including: Debt Instrument Investment
Others
Total 20,000,000.00
3. Notes receivable
(1) Details
1) Details on categories
Categories Closing balance
156
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Provision for bad
Book balance
debts
Carrying
Provision
amount
Amount % to total Amount proportion
(%)
Receivables with provision
for bad debts made on a 14,424,413.04 100.00 721,220.66 5.00 13,703,192.38
collective basis
Including: Bank acceptance
Trade acceptance 14,424,413.04 100.00 721,220.66 5.00 13,703,192.38
Total 14,424,413.04 100.00 721,220.66 5.00 13,703,192.38
(Continued)
Opening balance
Provision for bad
Book balance
debts
Categories Carrying
Provision
amount
Amount % to total Amount proportion
(%)
Receivables with provision for bad
17,714,790.57 100.00 685,739.53 3.87 17,029,051.04
debts made on a collective basis
Including: Bank acceptance 4,000,000.00 22.58 4,000,000.00
Trade acceptance 13,714,790.57 77.42 685,739.53 5.00 13,029,051.04
Total 17,714,790.57 100.00 685,739.53 3.87 17,029,051.04
2)Notes receivable with bad debt provision in combination
Closing balance
Items
Book balance Provision for bad debts Provision proportion (%)
bank acceptance
combination
Trade acceptance
14,424,413.04 721,220.66 5.00
combination
Total 14,424,413.04 721,220.66 5.00
(2) Changes in provision for bad debts
1) Details
Increase Decrease
Items Opening Closing
balance Accrual Recovery Others Reversal Write-off Others balance
individual
basis
157
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
collective 685,739.53 35,481.13 721,220.66
basis
Subtotal 685,739.53 35,481.13 721,220.66
(3) Endorsed or discounted but undue notes at the balance sheet date
Items Closing balance derecognized Closing balance not yet derecognized
Bank acceptance 40,892,846.08
Trade acceptance 7,563,925.38
Subtotal 48,456,771.46
Due to the fact that the acceptor of bank acceptance is commercial bank, which is of high credit level, there is very
little possibility of failure in recoverability when it is due. Based on this fact, the Company derecognized the
endorsed or discounted bank acceptance. However, if any bank acceptance is not recoverable when it is due, the
Company still holds joint liability on such acceptance, according to the China Commercial Instrument Law.
4. Accounts receivable
(1) Details
1) Details on categories
Closing balance
Categories Book balance Provision for bad debts
Carrying
Amount % to total Amount Provision amount
proportion (%)
Receivables with provision 78,379,779.60 14.75 78,379,779.60 100.00 -
made on an individual basis
453,042,019.3 334,586,551.9
Receivables with provision 85.25 118,455,467.41 26.15
made on a collective basis 4 3
531,421,798.9 196,835,247.0 334,586,551.9
Total 100.00 37.04
4 1 3
(Continued)
Opening balance
Categories Book balance Provision for bad debts
Carrying amount
Amount % to total Amount Provision
proportion (%)
Receivables with provision 59,944,074.91 9.14 59,944,074.91 100.00
made on an individual basis
595,708,348.2 101,715,944.7 493,992,403.4
Receivables with provision 90.86 17.07
made on a collective basis 4 5 9
655,652,423.1 161,660,019.6 493,992,403.4
Total 100.00 24.66
5 6 9
2) Accounts receivable with provision made on an individual basis
Provision
Debtors Book balance Provision for Reasons
proportion
bad debts
(%)
Dongpo Xi Laos Co., Ltd. 19,708,086.54 19,708,086.54 100.00 Unable to recover
158
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Provision
Debtors Book balance Provision for Reasons
proportion
bad debts
(%)
Mr. Xu 17,591,683.74 17,591,683.74 100.00 Unable to recover
China Tower Corporation Ltd. 13,819,926.92 13,819,926.92 100.00 Unable to recover
Jilin Lidi Information Technology Co., 5,999,750.00 5,999,750.00 100.00 Unable to recover
Ltd
China Railway Communication Signal 5,241,400.50 5,241,400.50 100.00 Unable to recover
Shanghai Engineering Group Co., Ltd
Others 16,018,931.90 16,018,931.90 100.00 Unable to recover
Subtotal 78,379,779.60 78,379,779.60 100.00
3) Accounts receivable with provision for bad debts made on age analysis
Closing balance
Ages
Book balance Provision for bad debts Provision proportion (%)
Within 1 year 174,417,246.90 1,744,172.48 1.00
1-2 years 64,013,020.08 3,200,651.00 5.00
2-3 years 56,234,363.04 5,623,436.30 10.00
3-4 years 54,651,481.02 16,395,444.32 30.00
4-5 years 24,468,289.98 12,234,144.99 50.00
Over 5 years 79,257,618.32 79,257,618.32 100.00
Subtotal 453,042,019.34 118,455,467.41 26.15
(2) Changes in provision for bad debts
Increase
Items Opening
balance Accrual Recovery Others
Receivables with provision made 59,944,074.91 27,260,082.40
on an individual basis
Receivables with provision 101,715,944.75 16,884,011.20
made on a collective basis
Subtotal 161,660,019.66 44,144,093.60
(Continued)
Decrease
Items Closing balance
Reversal Write-off Others
Receivables with provision
8,824,377.71 78,379,779.60
made on an individual basis
Receivables with provision
- 144,488.54 118,455,467.41
made on a collective basis
Subtotal 8,824,377.71 144,488.54 196,835,247.01
(3) Details of the top 5 debtors with largest balances
159
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Proportion to the total
Debtors Book balance Provision for bad
balance of accounts
debts
receivable (%)
Dongpo Xi Laos Co., Ltd. 19,708,086.54 3.71 19,708,086.54
Mr. Xu 17,591,683.74 3.31 17,591,683.74
Hegang branch of China Tower
13,819,926.92 2.60 13,819,926.92
Co., Ltd
China United Network
Communication Co., Ltd. Henan 8,828,589.22 1.66 4,836,072.87
Branch
Potevio Science & Technology
8,755,534.00 1.65 8,755,534.00
Industrial Co., Ltd.
Subtotal 68,703,820.42 12.93 64,711,304.07
5. Receivables financing
(1) Details
Closing balance Opening balance
Accumulated recognized Accumulated recognized
Items Carrying Carrying
credit impairment credit impairment
amount amount
allowance allowance
Bank
40,852,223.88 32,594,702.60
acceptance
Total 40,852,223.88 32,594,702.60
(2) Endorsed or discounted but undue notes at the balance sheet date
Items Closing balance derecognized
Bank acceptance 40,778,433.08
Subtotal 40,778,433.08
Due to the fact that the acceptor of bank acceptance is commercial bank, which is of high credit level, there is very
little possibility of failure in recoverability when it is due. Based on this fact, the Company derecognized the
endorsed or discounted bank acceptance. However, if any bank acceptance is not recoverable when it is due, the
Company still holds joint liability on such acceptance, according to the China Commercial Instrument Law.
6. Advances paid
(1) Age analysis
1) Details
Closing balance Opening balance
Ages
% to Provision for % to Provision for
Book balance Carrying amount Book balance Carrying amount
total impairment total impairment
Within 1 year 18,003,886.43 79.50 18,003,886.43 12,509,089.32 63.77 12,509,089.32
1-2 years 804,044.95 3.55 804,044.95 3,743,667.83 19.08 3,743,667.83
2-3 years 1,446,243.44 6.39 1,446,243.44 2,247,435.21 11.46 2,247,435.21
160
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Closing balance Opening balance
Ages
% to Provision for % to Provision for
Book balance Carrying amount Book balance Carrying amount
total impairment total impairment
Over 3 years 2,391,641.84 10.56 2,391,641.84 1,116,156.29 5.69 1,116,156.29
100.0 100.0
Total 22,645,816.66 22,645,816.66 19,616,348.65 19,616,348.65
0 0
(2) Details of the top 5 debtors with largest balances
Proportion to the total
Debtors Book balance balance of advances
paid (%)
Huawei Technology Co., Ltd 9,877,049.63 43.62
Guizhou Tianguang Shian Technology Co., Ltd 750,000.00 3.31
Nanjing Rongwei electric control equipment Co., Ltd 655,832.00 2.90
Shenzhen abison optoelectronics Co., Ltd 541,000.00 2.39
Dingjie Automation Technology Co., Ltd 475,000.00 2.10
Subtotal 12,298,881.63 54.31
7. Other receivables
(1) Details
1) Details on categories
Closing balance
Book balance Provision for bad debts
Categories
Carrying
Provision
Amount % to Amount amount
proportion
total
(%)
Receivables with provision made
28,912,122.71 50.23 28,912,122.71 100.00 -
on an individual basis
Receivables with provision made
28,650,270.24 49.77 12,022,075.07 41.96 16,628,195.17
on a collective basis
Total 57,562,392.95 100.00 40,934,197.78 71.11 16,628,195.17
(Continued)
Opening balance
Book balance Provision for bad debts
Categories
Carrying
Provision
Amount % to Amount amount
proportion
total
(%)
Receivables with provision made
28,912,122.71 51.88 28,912,122.71 100.00
on an individual basis
Receivables with provision made
26,817,237.74 48.12 9,905,447.43 36.94 16,911,790.31
on a collective basis
Total 55,729,360.45 100.00 38,817,570.14 69.65 16,911,790.31
161
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2) Other receivables with provision made on an individual basis
Debtors Book balance Provision for bad Provision Reasons for
debts proportion (%) provision made
Beijing Likangpu
Communication 28,912,122.71 28,912,122.71 100.00 Unable to recover
Equipment Co., Ltd.
Subtotal 28,912,122.71 28,912,122.71
3) Other receivables with provision made on a collective basis
Closing balance
Portfolios
Book balance Provision for bad debts Provision proportion (%)
Aging combination 27,071,322.87 12,022,075.07 44.41
Portfolio-Financing margin 1,578,947.37
Subtotal 28,650,270.24 12,022,075.07 41.96
(2) Age analysis
Ages Closing book balance Opening book balance
Within 1 year 7,008,502.69 6,470,106.41
1-2 years 2,850,719.97 6,515,139.65
2-3 years 5,231,249.14 4,733,535.99
3-4 years 4,606,299.15 3,610,856.13
4-5 years 3,549,119.02 1,448,923.00
Over 5 years 34,316,502.98 32,950,799.27
Subtotal 57,562,392.95 55,729,360.45
(3) Changes in provision for bad debts
1) Details
Phase I Phase II Phase III
Items 12 month Lifetime expected Lifetime expected Subtotal
expected credit losses (credit credit losses (credit
credit losses not impaired) impaired)
Opening balance 806,991.74 38,010,578.40 38,817,570.14
Opening balance in the
current period
--Transferred to phase II
--Transferred to phase III -3,454,965.50 - 3,454,965.50
--Reversed to phase II
--Reversed to phase I
162
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Phase I Phase II Phase III
Items 12 month Lifetime expected Lifetime expected Subtotal
expected credit losses (credit credit losses (credit
credit losses not impaired) impaired)
Provision made in the
3,296,400.11 - -1,179,772.47 2,116,627.64
current period
Provision recovered in
current period
Provision reversed in
current period
Provision written off in
current period
Retranslation
Decrease due to business
combination
Closing balance 648,426.35 - 40,285,771.43 40,934,197.78
(4) Other receivables categorized by nature
Nature of receivables Closing balance Opening balance
Temporary payment receivable 40,950,602.33 35,152,407.81
Security deposit 12,054,412.80 16,515,511.45
Imprest 905,189.12 1,471,813.99
Others 3,652,188.70 2,589,627.20
Total 57,562,392.95 55,729,360.45
(5) Details of the top 5 debtors with largest balances
Proportion to the
Debtors Nature of Ages Provision for
Book balance total balance of other
receivables bad debts
receivables (%)
Beijing Likangpu Temporary Over
Communication payment 28,912,122.71 5 50.23 28,912,122.71
Equipment Co., Ltd. receivable years
China Potevio Company Over3
Security deposit 1,938,000.00 3.37 1,938,000.00
Limited years
Far East International 2-3
Security deposit 1,578,947.37 2.74
Leasing Co.,Ltd. years
Construction headquarters
2-3
of Shenzhen Metro Group Security deposit 1,490,768.10 2.59 74,538.41
years
Co., Ltd
Temporary
Nanjing dingnuo
payment 4-5
Intelligent Technology 483,867.85 0.84 483,867.85
years
Co., Ltd receivable
Subtotal 34,403,706.03 59.77 31,408,528.97
8. Inventories
(1) Details
Items Closing balance Opening balance
163
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Provision for Provision for
Book balance Carrying amount Book balance Carrying amount
write-down write-down
Raw
31,234,604.53 9,134,918.13 22,099,686.40 32,804,463.00 5,678,761.14 27,125,701.86
materials
Work in
13,606,311.30 2,797,339.41 10,808,971.89 13,266,680.85 13,266,680.85
process
Goods on
79,928,818.55 40,226,500.64 39,702,317.91 86,350,107.31 18,772,268.10 67,577,839.21
hand
Goods
172,240,715.25 58,758,181.09 113,482,534.16 118,443,146.03 29,157,593.24 89,285,552.79
dispatched
Products on
consignment 1,242,747.33 804,691.99 438,055.34 3,190,889.60 804,691.99 2,386,197.61
for sales
Total 298,253,196.96 111,721,631.26 186,531,565.70 254,055,286.79 54,413,314.47 199,641,972.32
(2) Provision for inventory write-down
1) Details
Increase Decrease
Items Opening
Reversal or Closing balance
balance Accrual Others Others
write-off
Raw materials 5,678,761.14 3,960,223.37 504,066.38 9,134,918.13
Work in process 2,797,339.41 2,797,339.41
Goods on hand 18,772,268.10 24,116,300.88 2,662,068.34 40,226,500.64
Goods dispatched 29,157,593.24 30,153,132.47 552,544.62 58,758,181.09
Products on
804,691.99 804,691.99
consignment for sales
Subtotal 54,413,314.47 61,026,996.13 3,718,679.34 111,721,631.26
2) Specific basis for determining net realizable value and reversal or write off of inventory depreciation reserves in
the current period
Reasons for write off of
Items Specific basis for determining net Reasons for reversal of inventory
inventory depreciation
realizable value depreciation reserves
reserves
The estimated selling price of relevant
The NRV of inventory with provision The inventory with
Raw finished products minus the estimated
for inventory depreciation in the provision has been sold
materials cost to completion, estimated selling
previous period increased in the current period
expenses and relevant taxes
In the normal production and operation
process, the net realizable value of the The NRV of inventory with provision The inventory with
Goods
inventory is determined by the estimated for inventory depreciation in the provision has been sold
dispatched
selling price minus the estimated selling previous period increased in the current period
expenses and relevant taxes
Goods on In the normal production and operation The NRV of inventory with provision The inventory with
164
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Reasons for write off of
Items Specific basis for determining net Reasons for reversal of inventory
inventory depreciation
realizable value depreciation reserves
reserves
hand process, the net realizable value of the for inventory depreciation in the provision has been sold
inventory is determined by the estimated previous period increased in the current period
selling price minus the estimated selling
expenses and relevant taxes
9. Other current assets
Items Closing balance Opening balance
Input VAT to be credited 5,526,501.01 11,568,247.65
Prepaid income tax 2,236,499.06 1,557,774.43
Total 7,763,000.07 13,126,022.08
10. Long-term equity investments
(1) Categories
Closing balance Opening balance
Items
Provision for Carrying Provision for Carrying
Book balance Book balance
impairment amount impairment amount
Investments
10,422,193.15 10,422,193.15 10,422,056.96 10,422,056.96
in associates
Investments
in joint
ventures
Total 10,422,193.15 10,422,193.15 10,422,056.96 10,422,056.96
(2) Details
Increase/Decrease
Investees Opening
Investment income
balance Investments Investments Adjustment in other
recognized under
increased decreased comprehensive income
equity method
Joint ventures
SEI-Nanjing
Potevio Optical
10,422,056.96 136.19
Network Co.,
Ltd.
Total 10,422,056.96 136.19
(Continued)
Increase/Decrease Closing
Investees balance of
Closing balance
Changes in Cash dividend/Profit Provision for Others provision for
other equity declared for distribution impairment impairment
Joint ventures
SEI-Nanjing 10,422,193.15
165
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Increase/Decrease Closing
Investees balance of
Closing balance
Changes in Cash dividend/Profit Provision for Others provision for
other equity declared for distribution impairment impairment
Potevio Optical
Network Co.,
Ltd.
Total 10,422,193.15
11. Other equity instrument investments
Accumulated amount of gains
or losses transferred from other
Items Closing Opening Dividend comprehensive income to
balance balance income retained earnings
Amount Reasons
Nanjing Yuhua Electroplating Factory 420,915.00 420,915.00
Hangzhou Honyar Electrical Co.,Ltd. 321,038.00 321,038.00
Beijing Likangpu Communication
Equipment Co., Ltd.
Subtotal 741,953.00 741,953.00
Note: The investment in Nanjing Yuhua Electroplating Factory, Hangzhou Honyar Electrical Co.,Ltd. and Beijing
Likong Communication Equipment Co., Ltd. are classified as other equity instrument investments, the Company
measured it at fair value through other comprehensive income.
12. Investment property
(1) Details
Items Buildings and structures Total
Cost
Opening balance 12,256,127.93 12,256,127.93
Increase 6,363,023.04 6,363,023.04
1) Acquisition 6,363,023.04 6,363,023.04
Decrease
1) Disposal
Closing balance 18,619,150.97 18,619,150.97
Accumulated depreciation and amortization
Opening balance 7,989,114.58 7,989,114.58
Increase 3,775,144.88 3,775,144.88
1) Accrual or amortization 488,849.91 488,849.91
2）Transfer in of fixed assets 3,086,066.33 3,086,066.33
166
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Buildings and structures Total
3）Others 200,228.64 200,228.64
Decrease
1) Disposal
Closing balance 11,764,259.46 11,764,259.46
Provision for impairment
Opening balance
Increase
1) Accrual
Decrease
1) Disposal
Carrying amount
Closing balance 6,854,891.51 6,854,891.51
Opening balance 4,267,013.35 4,267,013.35
13. Fixed assets
(1) Details
Items Buildings and General Transport Electronic
Other equipment Total
structures equipment facilities equipment
Cost
Opening balance 134,663,363.37 34,132,418.65 7,887,148.60 2,299,878.54 44,835,592.91 223,818,402.07
Increase 24,285,656.35 2,044,909.44 2,832,399.37 978,934.98 30,141,900.14
1) Acquisition 634,235.63 361,835.55 2,832,399.37 978,934.98 4,807,405.53
2) Transferred in from
23,651,420.72 1,683,073.89 25,334,494.61
construction in progress
Decrease 6,748,332.83 6,061,772.39 2,471,940.33 3,717,405.82 202,940.00 19,202,391.37
1) Disposal/Scrapping 385,309.79 6,061,772.39 2,471,940.33 3,717,098.11 202,940.00 12,839,060.62
2) Business combination 6,363,023.04 6,363,023.04
3) others 307.71 307.71
Closing balance 152,200,686.89 30,115,555.70 5,415,208.27 1,414,872.09 45,611,587.89 234,757,910.84
Accumulated depreciation
Opening balance 47,849,478.31 24,943,137.29 7,154,206.68 2,114,915.83 40,872,637.82 122,934,375.93
Increase 5,494,398.02 1,431,909.97 201,161.51 1,313,520.35 155,014.18 8,596,004.03
1) Accrual 5,494,398.02 1,431,909.97 201,161.51 1,313,520.35 155,014.18 8,596,004.03
Decrease 3,290,122.23 6,043,748.48 2,347,425.35 3,421,440.53 196,851.80 15,299,588.39
1) Disposal/Scrapping 204,055.90 6,043,748.48 2,347,425.35 3,421,132.82 196,851.80 12,213,214.35
167
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Buildings and General Transport Electronic
Other equipment Total
structures equipment facilities equipment
2) Business combination 3,086,066.33 3,086,066.33
3) others 307.71 307.71
Closing balance 50,053,754.10 20,331,298.78 5,007,942.84 6,995.65 40,830,800.20 116,230,791.57
Provision for impairment
Opening balance 539,124.00 11,048.35 175,790.21 725,962.56
Increase
Decrease
Closing balance 539,124.00 11,048.35 175,790.21 725,962.56
Carrying amount
Closing balance 101,607,808.79 9,784,256.92 407,265.43 1,396,828.09 4,604,997.48 117,801,156.71
Opening balance 86,274,761.06 9,189,281.36 732,941.92 173,914.36 3,787,164.88 100,158,063.58
2) Fixed assets temporarily idle
Items Cost Accumulated Provision for
Carrying amount Remarks
depreciation impairment
General equipment 191,485.00 176,039.10 15,445.90
Electronic equipment 331,100.00 330,020.00 1,080.00
Other equipment 665,985.18 479,449.93 175,410.00 11,125.25
Subtotal 1,188,570.18 985,509.03 175,410.00 27,651.15
3) Fixed assets with certificate of titles being unsettled
Items Carrying amount Reasons for unsettlement
Buildings and structures 48,695,259.22 Unable to handle
Subtotal 48,695,259.22
14. Construction in progress
(1) Details
Closing balance Opening balance
Projects Provision Provision
Carrying for Carrying
Book balance for Book balance
amount impairme amount
impairment
Nanjing Putian nt
Datang Information
Electronics Co.,
21,300,309.31 21,300,309.31
Ltd. Product
Development
Center
Others 292,996.23 292,996.23 1,154,482.96 1,154,482.96
168
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Closing balance Opening balance
Projects Provision Provision
Carrying for Carrying
Book balance for Book balance
amount impairme amount
impairment
nt
Total 292,996.23 292,996.23 22,454,792.27 22,454,792.27
2) Changes in significant projects
Projects Budgets Increase Transferred to Closing balance
Opening balance
fixed assets
Nanjing Putian Datang
Information Electronics
30,000,000.00 21,300,309.31 4,034,185.30 25,334,494.61
Co., Ltd. Product
Development Center
Subtotal 30,000,000.00 21,300,309.31 4,034,185.30 25,334,494.61
(Continued)
Completio Accumulated Amount of
Accumulate n Annual
Projects amount of borrowing cost Fund
d input to percentage capitalization
borrowing cost capitalization in source
budget (%) rate (%)
(%) capitalization current period
Nanjing Putian
Datang Information
Electronics Co., Self-owned
84.45 100.00%
Ltd. Product fund
Development
Center
Subtotal - -
15. Intangible assets
(1) Details
Items Land use right Software Total
Cost
Opening balance 26,656,046.83 10,920,157.40 37,576,204.23
Increase 820,000.00 820,000.00
1) Acquisition 820,000.00 820,000.00
Decrease
1) Disposal
Closing balance 26,656,046.83 11,740,157.40 38,396,204.23
Accumulated amortization
Opening balance 6,512,813.57 9,802,271.26 16,315,084.83
Increase 634,289.66 338,082.26 972,371.92
169
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Land use right Software Total
1) Accrual 634,289.66 338,082.26 972,371.92
Decrease
1) Disposal
Closing balance 7,147,103.23 10,140,353.52 17,287,456.75
Carrying amount
Closing balance 19,508,943.60 1,599,803.88 21,108,747.48
Opening balance 20,143,233.26 1,117,886.14 21,261,119.40
16. Long-term prepayments
(1) Details
Items Opening balance Increase Amortization Closing balance
Renovation expenditure 5,541,410.81 1,183,302.34 1,750,744.95 4,973,968.20
Total 5,541,410.81 1,183,302.34 1,750,744.95 4,973,968.20
17. Deferred tax assets and deferred tax liabilities
(1) Details of unrecognized deferred tax assets
Items Closing balance Opening balance
Deductible temporary difference 350,212,296.71 259,762,732.16
Deductible losses 247,021,502.77 145,604,016.49
Subtotal 597,233,799.48 405,366,748.65
(2) Maturity years of deductible losses of unrecognized deferred tax assets
Maturity years Closing balance Opening balance Remarks
Year 2021 3,321,233.55 5,554,380.47
Year 2022 6,340,354.15 4,443,610.43
Year 2023 6,538,713.94 18,084,226.36
Year 2024 110,600,873.27 113,996,079.49
Year 2025 5,019,673.59 3,525,719.74
Year 2026 115,200,654.27
Subtotal 247,021,502.77 145,604,016.49
18. Short-term borrowings
(1) Details
170
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Closing balance Opening balance
Mortgaged borrowings 24,000,000.00 15,000,000.00
Secured borrowings 175,000,000.00 50,000,000.00
Total 199,000,000.00 65,000,000.00
19. Notes payable
(1) Details
Items Closing balance Opening balance
Bank acceptance 57,636,900.00
Trade acceptance 1,251,741.17 18,498,110.10
Total 1,251,741.17 76,135,010.10
20. Accounts payable
(1) Details
Items Closing balance Opening balance
Procurement of materials 536,734,286.45 603,045,038.32
Project payment 1,629,456.49 1,720,547.68
Total 538,363,742.94 604,765,586.00
(2) Significant accounts payable with age over one year
Items Closing balance Reasons for unsettlement
SEI-Nanjing Potevio Optical Network Co., Ltd. 18,589,974.96 Not yet settled
China Potevio Company Limited 16,314,294.20 Not yet settled
Nanjing Xingping Industrial Co., Ltd 7,368,248.11 Not yet settled
Jiangsu Lexi Technology Co., Ltd 6,045,068.82 Not yet settled
Xi'an Huasheng Communication Co., Ltd 6,028,815.75 Not yet settled
Subtotal 54,346,401.84
21. Contract liabilities
(1) Details
Items Closing balance Opening balance[Note]
Payment for goods 18,884,024.60 28,518,252.40
Total 18,884,024.60 28,518,252.40
22. Employee benefits payable
171
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(1) Details
Items Opening Increase Decrease Closing balance
balance
Short-term employee benefits 17,362,878.28 170,830,227.10 168,747,933.70 19,445,171.68
Post-employment benefits -
24,985,603.27 24,985,603.27
defined contribution plan
Total 17,362,878.28 195,815,830.37 193,733,536.97 19,445,171.68
(2) Details of short-term employee benefits
Items Opening Increase Decrease Closing balance
balance
Wage, bonus, allowance and
4,673,800.25 122,774,641.22 123,823,092.22 3,625,349.25
subsidy
Employee welfare fund 8,142,215.29 8,142,215.29
Social insurance premium 11,234,622.83 11,234,622.83
Including: Medicare premium 9,880,634.06 9,880,634.06
Occupational injuries
622,017.37 622,017.37
premium
Maternity premium 731,971.40 731,971.40
Housing provident fund 3,294,555.74 10,855,919.87 10,855,955.87 3,294,519.74
Trade union fund and employee
9,379,525.76 2,694,712.67 1,086,883.27 10,987,355.16
education fund
Compensation for termination of
4,557,451.50 3,034,500.50 1,522,951.00
labor relations
Others 14,996.53 10,570,663.72 10,570,663.72 14,996.53
Subtotal 17,362,878.28 170,830,227.10 168,747,933.70 19,445,171.68
(3) Details of defined contribution plan
Items Opening Increase Decrease Closing balance
balance
Basic endowment insurance
20,018,656.63 20,018,656.63
premium
Unemployment insurance
901,380.10 901,380.10
premium
Company annuity payment 4,065,566.54 4,065,566.54
Subtotal 24,985,603.27 24,985,603.27
23. Taxes and rates payable
Items Closing balance Opening balance
VAT 1,007,843.11 2,356,409.61
Enterprise income tax 774,605.96 5,300,903.29
Individual income tax 298,962.05 167,893.85
Urban maintenance and construction tax 166,309.25 336,089.22
172
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Closing balance Opening balance
Housing property tax 409,138.78 207,909.01
Land use tax 83,316.67 83,316.67
Education surcharge&local education
116,649.03 237,921.18
surcharge
Other tax 24,242.50 16,805.84
Total 2,881,067.35 8,707,248.67
24. Other payables
(1) Details
Items Closing balance Opening balance
Dividend payable 2,142,213.38 4,044,213.38
Other payables 61,864,581.70 49,714,907.25
Total 64,006,795.08 53,759,120.63
(2) Dividend payable
Items Closing balance Opening balance
Dividend of ordinary shares 2,142,213.38 4,044,213.38
Subtotal 2,142,213.38 4,044,213.38
(3) Other payables
Items Closing balance Opening balance
Temporary receipts payable 42,582,100.22 25,326,626.30
Unsettled installation cost 7,085,494.06 6,106,864.43
Deposits 4,797,260.63 6,497,152.88
Operating expenses 4,643,277.05 9,314,827.00
Others 2,756,449.74 2,469,436.64
Subtotal/Total 61,864,581.70 49,714,907.25
25. Non-current liabilities due within one year
Items Closing balance Opening balance
Long-term payables due within one year 2,656,474.95 9,181,720.08
Total 2,656,474.95 9,181,720.08
26. Other current liabilities
Items Closing balance Opening balance[Note]
VAT collected in advance 2,454,923.31 3,707,372.81
173
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Closing balance Opening balance[Note]
Total 2,454,923.31 3,707,372.81
27. Long-term payables
Items Closing balance Opening balance
Finance lease 4,036,160.05
Total 4,036,160.05
28. Share capital
Movements
Items Opening
Issue of Reserve Closing balance
balance Bonus Others Subtotal
new transferred
shares
shares to shares
Total shares 215,000,000 215,000,000
29. Capital reserve
Items Opening balance Increase Decrease Closing balance
Share premium 137,786,640.63 137,786,640.63
Other capital reserve 45,782,201.81 14,295,331.64 60,077,533.45
Total 183,568,842.44 14,295,331.64 197,864,174.08
Note: In this year, the company purchased the minority shareholders' equity of the subsidiary Nanman Electric Co.,
Ltd. The difference between the purchase price and the share of net assets enjoyed by the minority shareholders
accrued the capital reserve of 14,295,331.64 yuan.
30. Other comprehensive income (OCI)
Current period cumulative Closing
balance
Items Opening Current period
balance Less: Attributable Attributable to
cumulative
Income to parent non-controllin
before income
tax company g shareholders
tax
Items not to be reclassified
-6,853,931.65 34,293.83 34,293.83 -6,819,637.82
subsequently to profit or loss
Including: Translation reserves -4,999,021.65 34,293.83 34,293.83 -4,964,727.82
Reclassified financial assets to
-1,854,910.00 -1,854,910.00
OCI
Total -6,853,931.65 34,293.83 34,293.83 -6,819,637.82
31. Surplus reserve
Items Opening balance Increase Decrease Closing balance
Statutory surplus reserve 589,559.77 589,559.77
174
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Opening balance Increase Decrease Closing balance
Total 589,559.77 589,559.77
32. Undistributed profit
(1) Details
Items Current period Preceding period
cumulative comparative
Balance before adjustment at the end of preceding period -202,680,309.64 -224,644,862.48
Add: Increase due to adjustment (or less: decrease)
Opening balance after adjustment -202,680,309.64 -224,644,862.48
Add: Net profit attributable to owners of the parent
-138,766,373.70 21,964,552.84
company
Less: Appropriation of statutory surplus reserve
Dividend payable on ordinary shares
Closing balance -341,446,683.34 -202,680,309.64
(II) Notes to items of the consolidated income statement
1. Operating revenue/Operating cost
（1）Details
Current period cumulative Preceding period comparative
Items
Revenue Cost Revenue Cost
Main operations 896,485,694.43 705,367,055.78 1,001,079,639.70 824,093,835.42
Other operations 20,643,980.06 17,130,594.90 24,164,176.13 22,812,107.07
Total 917,129,674.49 722,497,650.68 1,025,243,815.83 846,905,942.49
（2）Breakdown of revenue from contracts with customers by major category
1）Revenue broken down by type of goods or services
For information on the breakdown of revenue by product or service type, please refer to Note XIII (II) to the
financial statements.
2）Revenue broken down by time of transfer of goods or services
Current period Preceding period
Items
cumulative comparative
Recognize revenue at a point in time 917,129,674.49 1,025,243,815.83
Total 917,129,674.49 1,025,243,815.83
（3）The revenue recognized in the current period and included in the opening book value of contract liabilities is
RMB 14,959,097.54.
2. Taxes and surcharges
175
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Current period cumulative Preceding period comparative
Urban maintenance and
1,646,043.10 1,809,453.62
construction tax
Education surcharge&local
1,175,291.31 1,276,393.76
education surcharge
Housing property tax 1,515,792.33 1,546,447.85
Land use tax 498,237.90 568,336.87
Other tax 402,132.06 648,528.71
Total 5,237,496.70 5,849,160.81
3. Selling expenses
Items Current period cumulative Preceding period comparative
Employee benefits 59,605,079.90 57,079,555.56
Business entertainment 11,019,689.73 14,810,790.03
Travelling expenses 6,418,642.09 8,320,143.23
Office expenses 5,363,559.72 4,918,392.62
Sales service charges 2,926,661.81 8,246,112.93
Conference expenses 889,635.62 459,420.68
Promotion expenses 804,186.18 446,883.59
Equipment maintain fees 57,709.51 626,909.61
Others 4,339,933.54 6,300,627.54
Total 91,425,098.10 101,208,835.79
4. Administrative expenses
Items Current period cumulative Preceding period comparative
Employee benefits 48,553,979.21 48,670,243.18
Depreciation and amortization 6,228,837.26 6,774,510.66
Consulting, intermediary and legal
2,489,981.97 5,956,557.06
fees
Office expenses 2,216,172.51 3,264,199.44
Lease expenses 1,436,824.81 2,365,498.74
Business entertainment 1,371,565.12 1,395,310.80
Travelling expense 980,357.83 750,329.40
Funding for Party Building 500,644.92 608,575.64
Loss from shutdown 1,903,415.67
Others 3,441,652.39 3,789,065.67
176
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Current period cumulative Preceding period comparative
Total 67,220,016.02 75,477,706.26
5. R&D expenses
Items Current period cumulative Preceding period comparative
Employee benefits 44,723,969.01 36,932,589.17
Travelling expenses 1,741,927.99 1,764,237.57
Depreciation and amortization 1,597,958.93 1,427,264.34
Material use 2,299,851.88 1,277,981.90
Intermediate test fee 131,608.52 224,424.47
Others 4,977,219.16 4,693,007.93
Total 55,472,535.49 46,319,505.38
6. Financial expenses
Items Current period cumulative Preceding period comparative
Interest expenditures 8,198,913.03 28,568,012.81
Less: Interest income 1,231,541.18 1,758,180.41
Losses on foreign exchange 3,832.90 19,380.93
Financial institution fees 184,069.24 216,787.73
Others 158,654.57 28,087.93
Total 7,313,928.56 27,074,088.99
7. Other income
Items Current period Preceding period Amount included in
cumulative comparative non-recurring profit or loss
Government grants
2,409,577.05 10,953,444.48 660,727.46
related to income [Note]
Service charge of
17,445.00 35,529.25
personal income tax
Others 4,000.00 4,000.00
Total 2,431,022.05 10,988,973.73 664,727.46
Note: Please refer to section V (IV) 3 of the notes to financial statements for details on government grants included
into other income.
8. Investment income
Current period Preceding period
Items
cumulative comparative
Investment income from disposal of long-term equity 98,897,269.56
177
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Current period Preceding period
Items
cumulative comparative
investments
Investment income from long-term equity investments under
136.19 -4,769,983.62
equity method
Investment income from derecognition of financial assets at
2,434,384.72 -952,176.00
amortized cost
Total 2,434,520.91 93,175,109.94
9. Credit impairment loss
Items Current period cumulative Preceding period comparative
Bad debt loss of notes receivable -35,481.13 -361,969.01
Bad debt loss of accounts receivable -44,144,093.60 -36,758,177.42
Bad debt loss of other receivables -2,116,627.64 -4,495,669.42
Total -46,296,202.37 -41,615,815.85
10. Assets impairment loss
Items Current period cumulative Preceding period comparative
Inventory write-down loss -61,026,996.13 -14,421,937.22
Total -61,026,996.13 -14,421,937.22
11. Gains on asset disposal
Amount included in
Items Current period Preceding period
non-recurring profit or
cumulative comparative
loss
Gains on disposal of fixed assets -134,892.35 78,480,698.99 -134,892.35
Gains on disposal of intangible
-5,923,710.98
assets
Total -134,892.35 72,556,988.01 -134,892.35
12. Non-operating revenue
Amount included in
Items Current period Preceding period
non-recurring profit or
cumulative comparative loss
Unpaid employee benefits 3,337,422.56
Unpaid payables 436,331.11
Penalty income 6,600.00 164,707.10 6,600.00
Others 478,955.18 363,153.86 478,955.18
Total 485,555.18 4,301,614.63 485,555.18
13. Non-operating expenditures
178
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Amount included in
Items Current period Preceding period
non-recurring profit or
cumulative comparative loss
Penalty expenditures 51,075.65 2,161,289.87 51,075.65
Donation expenditures 2,000.00 2,000.00 2,000.00
Overdue expenditure 10,353.90 10,353.90
Others 97,245.58 50,605.73 97,245.58
Total 160,675.13 2,213,895.60 160,675.13
14. Income tax expenses
(1) Details
Items Current period cumulative Preceding period comparative
Current period income tax
5,789,994.37 7,504,586.94
expenses
Total 5,789,994.37 7,504,586.94
(2) Reconciliation of accounting profit to income tax expenses
Items Current period Preceding period
cumulative comparative
Profit before tax -134,304,718.90 45,179,613.75
Income tax expenses based on tax rate applicable
-33,576,179.73 6,776,942.06
to the parent company
Effect of different tax rate applicable to
-2,712,078.06 4,607,902.23
subsidiaries
Effect of prior income tax reconciliation 415,195.75 -707,905.89
Effect of non-deductible costs, expenses and
-5,986,568.59 -6,363,766.98
losses
Utilization of deductible losses not previously
1,467,158.61 3,650,934.31
recognized as deferred tax assets
Effect of deducible temporary differences or
deductible losses not recognized as deferred tax -9,844,171.65
assets
Effect of deducible temporary differences or
184,062.99 110,437.79
deductible losses not recognized
Deduction of R&D expenditures 45,998,403.40 9,274,215.07
Income tax expenses 5,789,994.37 7,504,586.94
(III) Notes to items of the consolidated cash flow statement
1. Other cash receipts related to operating activities
Items Current period cumulative Preceding period comparative
Government grants 682,172.46 4,248,205.97
Interest income 1,231,541.18 1,758,180.41
Intercourse 11,457,279.40 3,166,427.19
179
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Current period cumulative Preceding period comparative
Others 5,607,786.16 6,613,152.65
Total 18,978,779.20 15,785,966.22
2. Other cash payments related to operating activities
Items Current period cumulative Preceding period comparative
Selling and Administrative
52,821,136.05 67,899,682.41
expenses paid in cash
Intercourse 9,235,390.47
Others 775,548.40 131,079.85
Total 53,596,684.45 77,266,152.73
3. Other cash receipts related to financing activities
Items Current period cumulative Preceding period comparative
Security of finance lease
4,000,000.00
recovered
Total 4,000,000.00
4. Other cash payments related to financing activities
Items Current period cumulative Preceding period comparative
Installment financing lease
10,561,405.18 10,430,132.25
payments
Total 10,561,405.18 10,430,132.25
5. Supplement information to the cash flow statement
(1) Supplement information to the cash flow statement
Supplement information Current period Preceding period
cumulative comparative
(1) Reconciliation of net profit to cash flow from operating
activities:
Net profit -140,094,713.27 37,675,026.81
Add: Provision for assets impairment loss 57,308,316.79 13,888,011.56
Provision for credit impairment loss 46,296,202.37 41,615,815.85
Depreciation of fixed assets, oil and gas assets,
9,285,082.58 8,846,872.58
productive biological assets
Amortization of intangible assets 972,371.92 1,356,243.79
Amortization of long-term prepayments 1,750,744.95 1,802,964.46
Loss on disposal of fixed assets, intangible assets and
134,892.35 -72,556,988.01
other long-term assets (Less: gains)
Fixed assets retirement loss (Less: gains)
180
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Supplement information Current period Preceding period
cumulative comparative
Gains from derecognition of financial assets at
-2,434,384.72 952,176.00
amortized cost
Losses on changes in fair value (Less: gains)
Financial expenses (Less: gains) 8,202,745.93 28,587,393.74
Investment losses (Less: gains) -136.19 -94,127,285.94
Decrease of deferred tax assets (Less: increase)
Increase of deferred tax liabilities (Less: decrease)
Decrease of inventories (Less: increase) -44,197,910.17 -4,132,697.71
Decrease of operating receivables (Less: increase) 139,371,979.70 205,597,222.73
Increase of operating payables (Less: decrease) -138,312,721.00 -79,053,430.99
Others -2,305,976.00
Net cash flows from operating activities -61,717,528.76 88,145,348.87
(2) Significant investing and financing activities not related
to cash receipts and payments:
Conversion of debt into capital
Convertible bonds due within one year
Fixed assets leased in under finance leases
(3) Net changes in cash and cash equivalents:
Cash at the end of the period 180,459,070.86 170,062,746.87
Less: Cash at the beginning of the period 170,062,746.87 208,783,866.60
Add: Cash equivalents at the end of the period
Less: Cash equivalents at the beginning of the period
Net increase of cash and cash equivalents 10,396,323.99 -38,721,119.73
(2) Composition of cash and cash equivalents
Items Closing balance Opening balance
1) Cash 180,459,070.86 170,062,746.87
Including: Cash on hand 343.39 2,229.39
Cash in bank on demand for payment 180,458,727.47 170,060,517.48
2) Cash equivalents
3) Cash and cash equivalents at the end of the period 180,459,070.86 170,062,746.87
(3) Amount of endorsed commercial acceptance not involving cash receipts and payments
Items Current period cumulative Preceding period comparative
Amount of endorsed commercial
92,233,814.07 159,593,293.14
acceptance
Including: Payment for goods 92,233,814.07 159,443,293.14
181
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Current period cumulative Preceding period comparative
Payment for acquisition of
long-term assets, such as 150,000.00
fixed-assets
(IV) Others
1. Assets with title or use right restrictions
Items Closing carrying amount Reasons for restrictions
Cash and bank balances 8,205,628.07 deposit for L/G
Cash and bank balances 831.44 Bank freeze due to litigation
Fixed assets 1,063,884.17 Mortgaged borrowings
Total 9,270,343.68
(2) Other remarks
We remind users of financial statements that, apart from the above assets with title or use right restrictions, in order
to entrust the parent company to apply for loans from Bank of Beijing, Jiangning Sub-branch, the Company
pledged its holding equities to the parent company, which include equity of Nanjing South Telecommunications Co
Ltd. 33.17 million yuan, equity of Nanjing Putian Telege Intelligent Building Co., Ltd. 4.80 million yuan, equity of
Nanjing Putian Changle Telecommunications Equipment Co., Ltd. 5.07 million yuan, equity of Nanjing Putian
Wangzhi Electronic Co., Ltd. 60.43 million yuan, equity of Nanjing Putian Network Co., Ltd. 7.80 million yuan.
The Company has registered the equity pledge at Nanjing Jiangning Market Supervision Administration. Those
equities are with use restrictions before released.
2. Monetary items in foreign currencies
Items Closing balance in Exchange rate RMB equivalent at the
foreign currencies end of the period
Cash and bank balances 107,718.57 6.3637 685,488.66
Including: USD 107,718.57 6.3637 685,488.66
3. Government grants
1) Government grants related to income and used to compensate incurred relevant costs, expenses or losses
Items Amounts Presented under Remarks
VAT refund 1,748,849.59 Other income Cai Shui [2011] No.100
Stable subsidy 466,620.88 Other income Nanjing social insurance management center
The State Administration of Taxation on Issuing
Performance award of
Other income ―Measures for the Administration of
employment service for 80,000.00
Preferential Value-Added Tax Policies for
resettling disabled persons
Promoting Employment of Disabled Persons‖
Other income National Treasury of the People's Republic of
unreported budget revenue 105,986.58
China Nanjing Central Branch
Others 8,120.00 Other income
Subtotal 2,409,577.05
182
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
The amount of government subsidies included in the current profits and losses is 2,409,577.05yuan.
VI. Changes in the consolidation scope
(I) Disposal of subsidiaries
None.
(II) Changes in the consolidation scope due to other reasons
None.
VII. Interest in other entities
(I) Interest in subsidiaries
1. Composition of subsidiaries
(1) Basis information
Main Holding
Subsidiaries Place of Business proportion (%) Acquisition
operating
registration nature Direct Indirect method
place
Nanjing Putian Changle
Nanjing Nanjing Manufacture 50.70
Telecommunications Set up
City City
Equipment Co., Ltd.
Nanjing Putian Telege Nanjing Nanjing Manufacture 45.77 Set up
Intelligent Building Ltd. City City
Nanjing South
Nanjing Nanjing Manufacture 96.99 3.01
Telecommunications Set up
City City
Company Limited
not under
Nanjing Nanman Nanjing Nanjing Manufacture 100.00 the same
Electrics Co., Ltd. City City
control
Nanjing Putian Nanjing Nanjing Manufacture 78.00 Set up
Network Co., Ltd. City City
Nanjing Putian Datang not under
Nanjing Nanjing Manufacture 40.00
Information Electronic the same
City City
Co., Ltd. control
Nanjing Putian
Nanjing Nanjing Manufacture 70.00
Communication Set up
City City
Technology Co., Ltd.
Putian Communications Hong Hong Trading 100.00 Set up
(Hong Kong) Co., Ltd. Kong Kong
Chongqing Puhua
Chongqi Chongqin Manufacture 100.00
Information Set up
ng City g City
Technology Co., Ltd
(2) Other remarks
Remarks on inconsistency between holding proportion owned and voting rights proportion owned
in subsidiaries
a. The Company holds 45.767% of voting rights in Nanjing Putian Telege Intelligent Building Ltd.,
the other voting rights are decentralized. The Company has over half member of the Board of
Directors, and it not only controls this company but also has a privileged variable return by taking
part in Nanjing Putian Telege Intelligent Building Ltd’s related activity. The Company has the
ability to impact the amount of return and control over Nanjing Putian Telege Intelligent Building
183
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Ltd.
b. The Company holds 40% equity of Nanjing Putian Datang Information Electronic Co., Ltd. The
Company signed the agreement with Yan yaoming, a shareholder of Nanjing Putian Datang
Information Electronic Co., Ltd., to exercise his 21% right to vote. The agreement is valid during
the period of the existence of Nanjing Putian Datang Information Electronic Co., Ltd. The
Company has 61% of the voting right during the existence period of Nanjing Putian Datang
Information Electronic Co., Ltd.
2. Significant not wholly-owned subsidiaries
(1) Details
Holding proportion Non-controlling Dividend declared Closing balance of
Subsidiaries of non-controlling shareholders’ profit to non-controlling non-controlling
shareholders or loss shareholders interest
Nanjing Putian
Telege 54.23% 15,457,415.64 10,846,600.00 52,712,082.95
Intelligent
Building Ltd.
3. Main financial information of significant not wholly-owned subsidiaries
(1) Assets and liabilities
Closing balance
Subsidiaries
Current Non-current Total assets Non-current
Current liabilities Total liabilities
assets assets liabilities
Nanjing Putian
Telege Intelligent 211,702,890.62 35,559,085.84 247,261,976.46 150,061,012.14 150,061,012.14
Building Ltd.
(Continued)
Opening balance
Subsidiaries
Current Non-current Total assets Current Non-current
Total liabilities
assets assets liabilities liabilities
Nanjing Putian
Telege Intelligent 222,552,329.22 35,936,096.57 258,488,425.79 169,790,901.71 169,790,901.71
Building Ltd.
(2) Profit or loss and cash flows
Current period cumulative Preceding period comparative
Cash flows
Total Cash flows Total
Subsidiaries
Operating from
Operating revenue Net profit comprehens from operating Net profit comprehensiv
revenue operating
ive income activities e income
activities
Nanjing Putian
Telege 28,503,440.
385,394,574.50 28,503,440.24 33,974,403.22 360,582,564.08 22,815,831.90 22,815,831.90 72,157,846.79
Intelligent 24
Building Ltd.
(II) Interest in joint venture or associates
184
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
1. Aggregated financial information of insignificant joint ventures and associates
Items Closing balance/Current Opening balance/Preceding
period cumulative period comparative
Joint ventures
Total carrying amount of investments 10,422,193.15 10,422,056.96
Proportionate shares in the following
items
Net profit 136.19 -10.65
Total comprehensive income 136.19 -10.65
VIII. Risks related to financial instruments
The Company aims to seek the appropriate balance between the risks and benefits from its use of financial
instruments and to mitigate the adverse effects that the risks of financial instruments have on the Company’s
financial performance. Based on such objectives, the Company’s risk management policies are established to
identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor
risks and adherence to limits.
The Company has exposure to the following risks from its use of financial instruments, which mainly include:
credit risk, liquidity risk, and market risk. Management have deliberated and approved policies concerning such
risks, and details are:
(I) Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by
failing to discharge an obligation.
1. Credit risk management practice
(1) Evaluation method of credit risk
At each reporting date, the Company assesses whether the credit risk on a financial instrument has increased
significantly since initial recognition. When assessing whether the credit risk has increased significantly since
initial recognition, the Company takes into account reasonable and supportable information, which is available
without undue cost or effort, including qualitative and quantitative analysis based on historical data, external credit
risk rating, and forward-looking information. The Company determines the changes in default risk of financial
instruments during the estimated lifetime through comparison of the default risk at the balance sheet date and the
initial recognition date, on an individual basis or a collective basis.
The Company considers the credit risk on a financial instrument has increased significantly when one or more of
the following qualitative and quantitative standards are met:
1) Quantitative standard mainly relates to the scenario in which, on the balance sheet date, the probability of
default in the remaining lifetime has risen by more than a certain percentage compared with the initial recognition;
2) Qualitative standard mainly relates to significant adverse changes in the debtor’s operation or financial position,
present or expected changes in technology, market, economy or legal environment that will have significant
adverse impact on the debtor’s repayment ability;
(2) Definition of default and credit-impaired asset
185
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
A financial asset is credit-impaired when one or more following events have occurred:
1) significant financial difficulty of the debtor;
2) a breach of binding clause of contract;
3) it is very likely that the debtor will enter bankruptcy or other financial reorganization;
4) the creditor of the debtor, for economic or contractual reasons relating to the debtor’s financial difficulty, having
granted to the debtor a concession(s) that the creditor would not otherwise consider.
2. Measurement of expected credit losses
The key factors in the measurement of expected credit loss include the probability of default, loss rate of default,
and exposure to default risk.
3. Please refer to note V(I)3；V(I)4; V(I)5；V(I)7 on the reconciliation table of opening balance and closing balance
of provision for losses of financial instrument.
4. Exposure to credit risk and concentration of credit risk
The Company’s credit risk is primarily attributable to cash and bank balances and receivables. In order to control
such risks, the Company has taken the following measures:
(1) Cash and bank balances
The Company deposits its bank balances and other cash and bank balances in financial institutions with relatively
high credit levels, hence, its credit risk is relatively low.
(2) Receivables
The Company performs credit assessment on customers who uses credit settlement on a regular/continuous basis.
The Company selects credible and well-reputed customers based on credit assessment result, and conducts ongoing
monitoring on receivables, to avoid significant risks in bad debts.
As the Company only conducts business with credible and well-reputed third parties, normally, does not obtain
collateral from customers. Normally, the Group does not obtain collateral from customers. The Company manages
credit risk aggregated by customers. As of December 31, 2021, the Company has certain concentration of credit
risk, and 12.93% (December 31, 2020: 11.90%) of the total accounts receivable was due from the five largest
customers of the Company. The Company held no collateral or other credit enhancement on balance of receivables.
The maximum amount of exposure to credit risk of the Company is the carrying amount of each financial asset on
the balance sheet.
(II) Liquidity risk
Liquidity risk is the risk that the Company may encounter deficiency of funds in meeting obligations associated
with cash or other financial assets settlement, which is possibly attributable to failure in selling financial assets at
fair value on a timely basis, or failure in collecting liabilities from counterparts of contracts, or early redemption of
debts, or failure in achieving estimated cash flows.
In order to control such risk, the Company utilized financing tools such as notes settlement, bank borrowings, etc.
and adopts long and short financing methods to optimizing financing structures, and finally maintains a balance
between financing sustainability and flexibility. The Company has obtained credit limit from several commercial
186
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
banks to meet working capital requirements and expenditures.
Financial instruments classified based on remaining time period till maturity
Closing balance
Items
Contract amount 1-3 years Over 3
Carrying amount Within 1 year
not yet discounted years
Short-term
199,000,000.00 203,055,109.72 203,055,109.72
borrowings
Notes payable 1,251,741.17 1,251,741.17 1,251,741.17
Accounts payable 538,363,742.94 538,363,742.94 538,363,742.94
Other payable 64,006,795.08 64,006,795.08 64,006,795.08
Long-term payable
Non-current liabilities
2,656,474.95 2,717,664.49 2,717,664.49
due within one year
Subtotal 805,278,754.14 809,395,053.40 809,395,053.40
(Continued)
Opening balance
Items
Contract amount 1-3 years Over 3
Carrying amount Within 1 year
not yet discounted years
Short-term
65,000,000.00 66,950,000.00 66,950,000.00
borrowings
Notes payable 76,135,010.10 76,135,010.10 76,135,010.10
Accounts payable 604,765,586.00 604,765,586.00 604,765,586.00
Other payable 53,759,120.63 53,759,120.63 53,759,120.63
Long-term payable 4,036,160.05 4,157,244.85 4,157,244.85
Non-current
liabilities due within 9,181,720.08 9,457,171.68 9,457,171.68
one year
Subtotal 812,877,596.86 815,224,133.26 811,066,888.41 4,157,244.85
(III) Market risk
Market risk is the risk that the Company may encounter fluctuation in fair value of financial
instruments or future cash flows due to changes in market price.
1. Interest risk
Interest risk is the risk that an enterprise may encounter fluctuation in fair value of financial instruments or future
cash flows due to changes in market interest. The Company’s fair value interest risks arise from fixed-rate financial
instruments, while the cash flow interest risks arise from floating interest financial instruments. The Company
determines the proportion of fixed-rate financial instruments and floating interest rate financial instruments based
on the market environment, and maintains a proper financial instruments portfolio through regular review and
monitoring. The Company’s interest risk relates mainly to bank borrowings with floating interest rate.
2. Foreign currency risk
187
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Foreign currency risk is the risk arising from changes in fair value or future cash flows of financial instrument
resulted from changes in exchange rate. The Company’s foreign currency risk relates mainly to foreign currency
monetary assets and liabilities.
Please refer to notes to financial statements for details in foreign currency financial assets and liabilities at the end
of the period.
IX. Fair value disclosure
(I) Details of fair value of assets and liabilities at fair value at the balance sheet date
Fair value as of the balance sheet date
Items Level 1 fair Level 2 fair Level 3 fair
value value value Total
measurement measurement measurement
Recurring fair value measurement
1. Held-for-trading financial
20,000,000.00 20,000,000.00
assets
2. Receivables financing 40,852,223.88 40,852,223.88
3. Other equity instrument 741,953.00 741,953.00
investments
Total assets at recurring fair value 61,594,176.88 61,594,176.88
measurement
(II) Valuation technique(s) and key input(s) for level 3 fair value at recurring and non-recurring
fair measurement
1. For notes receivable, measured at par value.
2. For other equity instrument investments including Nanjing Yuhua Electroplating Factory and
Hangzhou Honyar Electrical Co.,Ltd., due to no changes of operating environment and conditions
and financial conditions of the invested enterprises, the Company measured at investment cost.
3. For other equity instrument investments including Beijing Likangpu Communication
Equipment Co., Ltd., due to deterioration of operating environment and conditions and financial
conditions of the invested enterprises, the Company measured at zero value.
X. Related party relationships and transactions
(I) Related party relationships
1. Parent company
(1) Details
Holding
Parent Voting right
Business proportion
Place of registration Registered capital proportion over
company nature over the
the Company (%)
Company (%)
No.2 Tudi 2 Road,
China Potevio
Zhongguan Village Information
Company 1,903,050,000.00 53.49 53.49
Economy Zone, Haidian industry
Limited
District, Beijing
The Company’s ultimate controlling party is China Electronics Technology Group Corporation
(CETC).
188
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
2. Please refer to section VII of notes to financial statements for details on the Company’s
subsidiaries.
3. Joint ventures and associates of the Company
(1) Joint ventures and associates of the Company
Please refer to section VII of notes to financial statements for details on the Company’s significant
joint ventures and associates. Details of other joint ventures or associates carrying out related party
transactions with the Company in current period or in preceding period but with balance in current
period are as follows:
Joint ventures or associates Relationships with the Company
SEI-Nanjing Potevio Optical Network Co., Joint ventures
Ltd.
4. Other related parties of the Company
(1) Details
Related parties Relationships with the Company
An affiliated company of the ultimate
Nanjing Honyar Electrical Technology Co., Ltd.
controlling party
An affiliated company of the ultimate
Potevio Hi-tech Industry Co., Ltd.
controlling party
An affiliated company of the ultimate
Nanjing Putian Information Technology Co., Ltd.
controlling party
Beijing Potevio Taili Communications An affiliated company of the ultimate
Technology Co., Ltd. controlling party
An affiliated company of the ultimate
Nanjing Honyar Electrical Co., Ltd.
controlling party
An affiliated company of the ultimate
Eastern Communications Inc.
controlling party
An affiliated company of the ultimate
Potevio Eastern Communications Co.,Ltd.
controlling party
An affiliated company of the ultimate
Potevio Science & Technology Industrial Co., Ltd.
controlling party
An affiliated company of the ultimate
POTEVIO Telecommunications Co., Ltd.
controlling party
Beijing Potevio Desheng Technology Incubator An affiliated company of the ultimate
Co., Ltd controlling party
An affiliated company of the ultimate
Wuhan Putian New Energy Co., Ltd
controlling party
An affiliated company of the ultimate
Shanghai Potevio Network Technology Co., Ltd.
controlling party
Shanghai Potevio Post and Telecommunications An affiliated company of the ultimate
Technology Co., Ltd. controlling party
Tianjin Potevio Innovation and Entrepreneur An affiliated company of the ultimate
189
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Related parties Relationships with the Company
Technology Co., Ltd. controlling party
An affiliated company of the ultimate
Nanjing Putian Information Technology Co., Ltd.
controlling party
Beijing Likangpu Communication Equipment Co., An affiliated company of the ultimate
Ltd. controlling party
Nanjing Hikvision Digital Technology Co., Ltd An affiliated company of the ultimate controlling party
China Electronic Technology Finance Co., Ltd An affiliated company of the ultimate controlling party
The 23rd Research Institute of China Electronics
An affiliated company of the ultimate controlling party
Technology Group Corporation (CETC)
Chengdu Weishitong Information Security An affiliated company of the ultimate
Technology Co., Ltd controlling party
Hebei Far East Communication System An affiliated company of the ultimate
Engineering Co., Ltd controlling party
An affiliated company of the ultimate
Nanjing Rail Transit System Engineering Co., Ltd
controlling party
An affiliated company of the ultimate
Nanjing Laisi Information Technology Co., Ltd
controlling party
An affiliated company of the ultimate
Shanghai Huaxun Network System Co., Ltd
controlling party
Nanjing lop Co., Ltd An affiliated company of the ultimate controlling party
Sichuang Electronics Co., Ltd An affiliated company of the ultimate controlling party
Zhongkexin integrated circuit Co., Ltd. Nanjing
An affiliated company of the ultimate controlling party
Branch
Beijing Taiji Information System Technology Co.,
An affiliated company of the ultimate controlling party
Ltd
An affiliated company of the ultimate controlling
Hangzhou Hikvision Technology Co., Ltd
party、The company's shareholding company
China Putian Information Industry Group Co., Ltd Indirect controlling shareholder
(II) Related party transactions
1. Purchase and sale of goods, rendering and receiving of services
(1) Details
1) Purchase of goods and receiving of services
Related parties Content of transaction Preceding period
Current period cumulative
comparative
Nanjing Potevio
Telecommunication
Honyar Electrical 456,378.05 1,651,259.37
products
Technology Co., Ltd.
Nanjing Hikvision
Telecommunication
Digital Technology products
14,410.33
Co., Ltd
Telecommunication
China Potevio Company 371,681.42
products
190
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Related parties Content of transaction Preceding period
Current period cumulative
comparative
Limited
The 23rd Research
Institute of China
Electronics Testing fee 23,018.87
Technology Group
Corporation (CETC)
Potevio Information Telecommunication
239,336.28 68,584.07
Technology Co., Ltd. products
Potevio Hi-tech
service fee 258,113.16
Industry Co., Ltd.
2) Sale of goods and rendering of services
Related parties Content of transaction Current period Preceding period
cumulative comparative
Potevio Information Technology Telecommunication
66,796.46 331,975.44
Co., Ltd. products
Telecommunication
China Potevio Company Limited 517,067.86 1,759,578.23
products
Beijing Potevio Taili
Telecommunication
Communications Technology Co., 7,867.42 1,725.66
products
Ltd.
Telecommunication
Eastern Communications Inc. 1,295,903.33 273,476.12
products
Potevio Eastern Communications Telecommunication
23,588.42 22,641.51
Co.,Ltd. products
Potevio Science & Technology Telecommunication
41,299.97
Industrial Co., Ltd. products
Potevio Telecommunications Co., Telecommunication
1,040,734.52
Ltd. products
Beijing Potevio Desheng Telecommunication
1,923,178.85
Technology Incubator Co., Ltd products
Chengdu Weishitong Information Telecommunication
3,094,690.26
Security Technology Co., Ltd products
Hebei Far East Communication System Telecommunication
4,606,252.16
Engineering Co., Ltd products
Nanjing Rail Transit System Telecommunication
1,328,017.68
Engineering Co., Ltd products
Nanjing Laisi Information Technology Telecommunication
162,831.85
Co., Ltd products
Shanghai Huaxun Network System Co., Telecommunication
59,320.35
Ltd products
Telecommunication
Sichuang Electronics Co., Ltd 88,685.84
products
Zhongkexin integrated circuit Co., Ltd.
Nanjing Branch
Processing 74,165.34
Wuhan Putian New Energy Co., Telecommunication
16,088.49 297,203.55
Ltd products
2. Related party leases
(1) Details
1) The Company as the lessee
191
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Lessors Lease expenses for Lease expenses for the
Types of asset leased
current period preceding period
Potevio Hi-tech
Land and buildings 839,675.19 796,113.90
Industry Co., Ltd.
2) The Company as the lessor
Lease incomes for current Lease incomes for the
Lessee Types of asset leased
period preceding period
Nanjing lop Co., Ltd Land and buildings 395,238.10
3. Related party guarantees
(1) Details
1) The Company and its subsidiaries as guaranteed parties
Guarantors Amount Commencement Maturity date Whether the guarantee is
guaranteed date mature
China Potevio
25,000,000.00 2021/2/8 2022/2/7 No
Company Limited
China Potevio No
25,000,000.00 2021/3/25 2022/3/24
Company Limited
China Potevio No
45,000,000.00 2021/4/12 2022/4/11
Company Limited
China Potevio No
50,000,000.00 2021/10/27 2022/10/26
Company Limited
4. Call loans between related parties
Entrusted loans and interest expenses
Current period cumulative Preceding period comparative
with parent company
Entrusted loans 145,000,000.00
Entrusted interest expenses 4,477,491.67 12,867,202.78
5. Key management’s emoluments
Items Current period cumulative Preceding period comparative
Key management’s emoluments 3,668,506.00 2,430,976.00
6.Other related party transactions
On December 31, 2021, the balance of the company's funds deposited in China Electronics Technology Finance
Co., Ltd. was 7,151,551.17 yuan, which were all bank deposits. During the reporting period, the deposit interest
income was 17,793.85 yuan.
(III) Balance due to or from related parties
1. Balance due from related parties
Closing balance Opening balance
Items Related parties
Book balance Provision for Book balance Provision for
bad debts bad debts
192
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Closing balance Opening balance
Items Related parties
Book balance Provision for Book balance Provision for
bad debts bad debts
Cash and
bank
balances
China Electronic
Technology Finance Co., 7,151,551.17
Ltd
Accounts
receivable
China Potevio Company
5,519,204.83 3,339,327.20 5,890,775.42 2,761,564.47
Limited
Potevio Information
6,065,598.36 1,321,517.31 6,900,298.36 536,650.66
Technology Co., Ltd.
Shanghai Potevio
Network Technology Co., 536,319.70 132,831.97
Ltd.
Shanghai Potevio Post
8,755,534.00 8,755,534.00 8,755,534.00 8,755,534.00
and Technology Co., Ltd.
Eastern Communications
19,100.00 315.00 20,659.60 206.60
Inc.
Potevio
Telecommunications Co., 4,317,924.00 372,990.90 4,317,924.00 168,855.00
Ltd.
Tianjin Potevio
Innovation and
4,546.26 1,363.88 4,546.26 454.63
Entrepreneur Technology
Co., Ltd.
Beijing Potevio Desheng
Technology Incubator 107,164.50 1,071.65
Co., Ltd
Beijing Taiji Information
System Technology Co., 182,680.00 18,268.00
Ltd
Hebei Far East
Communication System 7,954,628.78 210,528.84
Engineering Co., Ltd
Nanjing Rail Transit
System Engineering Co., 905,040.41 9,050.40
Ltd
Sichuang Electronics Co.,
183,262.43 8,388.89
Ltd
Zhongkexin integrated
circuit Co., Ltd. Nanjing 26,373.10 263.73
Branch
Subtotal 41,085,443.34 14,037,548.15 26,533,221.84 12,357,168.98
Advances
paid
China Potevio Company
420,000.00
Limited
Hangzhou Hikvision
6,850.00
Technology Co., Ltd
Subtotal 6,850.00 420,000.00
Other
receivables
China Potevio Company
2,245,100.00 1,953,355.00 2,245,100.00 1,062,255.00
Limited
Potevio Information
367,800.00 367,800.00 1,203,052.00 60,152.60
Technology Co., Ltd.
193
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Closing balance Opening balance
Items Related parties
Book balance Provision for Book balance Provision for
bad debts bad debts
Beijing Likangpu
Communication 28,912,122.71 28,912,122.71 28,912,122.71 28,912,122.71
Equipment Co., Ltd.
Nanjing Hikvision Digital
80,000.00 4,000.00
Technology Co., Ltd
The 23rd Research
Institute of China
Electronics Technology 67,400.00 3,370.00
Group Corporation
(CETC)
Subtotal 31,672,422.71 31,240,647.71 32,360,274.71 30,034,530.31
2. Balance due to related parties
Items Related parties Closing balance Opening balance
Accounts
payable
SEI-Nanjing Potevio Optical Network
20,220,725.66
Co., Ltd.
China Potevio Company Limited 18,016,137.43 18,332,258.02
Shanghai Potevio Network Technology
11,685.00
Co., Ltd.
Potevio Hi-tech Industry Co., Ltd. 25,000.00 25,000.00
Nanjing Honyar Electrical Technology
19,580.00 126,806.40
Co., Ltd.
Subtotal 18,060,717.43 38,716,475.08
Advances
received
China Potevio Company Limited 4,703,127.30 4,690,537.30
Potevio Company Limited. 13,239.48
Wuhan Putian New Energy Co., Ltd 12,120.00
Subtotal 4,703,127.30 4,715,896.78
Other
payables
Potevio Hi-tech Industry Co., Ltd. 3,805,596.06 3,588,281.58
Potevio Information Technology Co.,
400,000.00 555,000.00
Ltd.
Potevio Telecommunications Co., Ltd. 200,000.00 200,000.00
Potevio Company Limited. 9,580,000.00 9,580,000.00
China Potevio Company Limited 231,015.28
Nanjing Putian Information Technology
3,042,825.53
Co., Ltd.
Subtotal 17,259,436.87 13,923,281.58
Short-term
borrowings
China Potevio Company Limited 145,000,000.00
Subtotal 145,000,000.00
194
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
XI. Commitments and contingencies
(I) Significant commitments
None.
(II) Contingencies
None.
XII. Events after the balance sheet date
None.
XIII. Other significant events
(一) Correction of previous accounting errors
1. Important previous errors and corrections
（1）Reasons for prior error corrections
he Company has received the Administrative Regulatory Measures Decision ([2022] No. 10) issued by the
Jiangsu Regulatory Bureau of the China Securities Regulatory Commission on January 23, 2022.According to the
decision on administrative supervision measures, it is determined that the company has the following violation
facts: During the period from 2017 to 2019, the private network communication business carried out by your
company is essentially to provide customers with entrusted processing business, and it does not bear the inventory
risk and price risk of commodities. The entrusted processing service fee income is recognized according to the net
method, but your company has always used the gross method to recognize the income. According to "Accounting
Standards for Business Enterprises No. 28 - Accounting Policies, Changes in Accounting Estimates and Correction
of Errors" and "Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No.
19 - Correction of Financial Information and Related Disclosures (Revised in 2020)" (Announcement [2020] No.
20 of the China Securities Regulatory Commission), the company will correct relevant errors.
（2）Accounting treatment of previous error correction
After receiving the decision on administrative supervision measures, the company conducted self-examination
and self-correction in 2017, 2018 and 2019, corrected the aforementioned errors by retrospective restatement, and
made retrospective adjustments to the financial statements of each year accordingly.
This statement has been approved for publication at the fifty-eight meeting of the seven Board of Directors of
the Company on April 22, 2022.
2. Influence of important prior error corrections on the company's financial position, operating results and
195
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
cash flow
(1) Impact on the consolidated income statement
1) 2017
Amount before
Items Adjustment amount Adjusted amount
adjustment
Operating revenue 2,254,399,406.04 -484,090,085.50 1,770,309,320.54
Operating cost 1,880,588,070.75 -484,090,085.50 1,396,497,985.25
2) 2018
Amount before
Items Adjustment amount Adjusted amount
adjustment
Operating revenue 1,995,627,772.60 -360,477,056.67 1,635,150,715.93
Operating cost 1,643,115,522.38 -360,477,056.67 1,282,638,465.71
3) 2019
Amount before
Items Adjustment amount Adjusted amount
adjustment
Operating revenue 1,338,284,194.21 -181,512,931.27 1,156,771,262.94
Operating cost 1,087,774,366.66 -181,512,931.27 906,261,435.39
(2) Impact on the parent company's income statement
1) 2017
Amount before
Items Adjustment amount Adjusted amount
adjustment
Operating revenue 1,149,882,076.74 -484,090,085.50 665,791,991.24
Operating cost 1,009,471,690.52 -484,090,085.50 525,381,605.02
2) 2018
Amount before
Items Adjustment amount Adjusted amount
adjustment
Operating revenue 1,005,618,954.77 -360,477,056.67 645,141,898.10
Operating cost 879,422,579.08 -360,477,056.67 518,945,522.41
3) 2019
Amount before
Items Adjustment amount Adjusted amount
adjustment
196
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Amount before
Items Adjustment amount Adjusted amount
adjustment
Operating revenue 433,903,979.88 -181,512,931.27 252,391,048.61
Operating cost 397,437,511.55 -181,512,931.27 215,924,580.28
(II) Segment information
1. Identification basis for reportable segments
Reportable segments are identified based on operating segments which are determined based on the structure of the
Company’s internal organization, management requirements and internal reporting system. The Company
identified reportable segments based on products, which include video conferencing products, generic cable
products, electrical products, wiring products, and other products. Assets and liabilities shared by different
segments are allocated pro rata among segments.
The Company identified reportable segments based on products, assets and liabilities of each segment are the
actual amount of its proportion in assets and liabilities, and revenue from main operations and cost of main
operations are those generated or incurred by each product segment.
2. Financial information of reportable segments
Products segment
Video
Items Generic cable Electrical Wiring products Inter-segment Total
conferencing
products products offsetting
products
Revenue from
293,267,591.71 381,243,880.13 100,939,986.75 153,488,446.15 -32,454,210.31 896,485,694.43
main operations
Cost of main
227,789,514.03 291,804,222.05 76,275,464.34 141,952,065.67 -32,454,210.31 705,367,055.78
operations
Total assets 251,531,380.06 247,261,976.46 196,763,512.42 530,515,462.52 -232,500,349.02 993,571,982.44
Total liabilities 155,520,791.05 150,061,012.14 144,374,909.92 545,311,462.03 -146,324,234.06 848,943,941.08
XIV. Notes to items of parent company financial statements
(I) Notes to items of parent company balance sheet
1. Accounts receivable
(1) Details
1) Details on categories
Closing balance
Categories Book balance Provision for bad debts
Carrying amount
Amount % to total Amount Provision
proportion (%)
Receivables with provision
70,076,309.09 25.59 70,076,309.09 100.00 -
made on an individual basis
Receivables with provision
203,781,201.65 74.41 79,035,628.98 38.78 124,745,572.67
made on a collective basis
Total 273,857,510.74 100.00 149,111,938.07 54.45 124,745,572.67
(Continued)
197
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Opening balance
Categories Book balance Provision for bad debts
Carrying amount
Amount % to total Amount Provision
proportion (%)
Receivables with provision
59,944,074.91 17.44 59,944,074.91 100.00
made on an individual basis
Receivables with provision
283,799,350.56 82.56 64,912,032.38 22.87 218,887,318.18
made on a collective basis
Total 343,743,425.47 100.00 124,856,107.29 36.32 218,887,318.18
2) Accounts receivable with provision made on an individual basis
Debtors Book balance Provision for bad Provision Reasons for
debts proportion (%) provision made
Dongpo Xi Laos Co., Ltd. 19,708,086.54 19,708,086.54 100.00 Unable to collect
Mr. Xu 17,591,683.74 17,591,683.74 100.00 Unable to collect
China Tower Corporation Unable to collect
13,819,926.92 13,819,926.92 100.00
Ltd.
China Railway
Communication Signal Unable to collect
5,241,400.50 5,241,400.50 100.00
Shanghai Engineering
Group Co., Ltd
Others 13,715,211.39 13,715,211.39 100.00 Unable to collect
Subtotal 70,076,309.09 70,076,309.09 100.00
3) Accounts receivable with provision for bad debts made on an age analysis
Closing balance
Ages
Provision proportion
Book balance Provision for bad debts
(%)
Within 1 year 51,326,203.63 513,262.04 1.00
1-2 years 19,790,631.45 989,531.57 5.00
2-3 years 22,670,878.34 2,267,087.83 10.00
3-4 years 39,529,690.55 11,858,907.17 30.00
4-5 years 10,779,217.30 5,389,608.65 50.00
Over 5 years 58,017,231.72 58,017,231.72 100.00
Subtotal 202,113,852.99 79,035,628.98 39.10
(2) Changes in provision for bad debts
Increase Decrease
Items Opening Closing
balance Accrual Recovery Others Reversal Write-off Others balance
Receivables
with provision
59,944,074.91 18,956,611.89 8,824,377.71 70,076,309.09
made on an
individual basis
Receivables
with provision
64,912,032.38 14,123,596.60 79,035,628.98
made on a
collective basis
198
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Increase Decrease
Items Opening Closing
balance Accrual Recovery Others Reversal Write-off Others balance
Subtotal 124,856,107.29 33,080,208.49 8,824,377.71 149,111,938.07
(3) Details of the top 5 debtors with largest balances
Proportion to the total
Debtors Book balance Provision for bad
balance of accounts
debts
receivable (%)
Dongpo Xi Laos Co., Ltd. 19,708,086.54 7.20 19,708,086.54
Mr. Xu 17,591,683.74 6.42 17,591,683.74
Hegang branch of China Tower Co.,
13,819,926.92 5.05 13,819,926.92
Ltd
China United Network
Communication Co., Ltd. Henan 8,828,589.22 3.22 4,836,072.87
Branch
Potevio Science & Technology
8,755,534.00 3.20 8,755,534.00
Industrial Co., Ltd.
Subtotal 68,703,820.42 25.09 64,711,304.07
2. Other receivables
(1) Details
Items Closing balance Opening balance
Interest receivable
Dividends receivable 600,000.00
Other receivables 27,944,036.00 50,275,151.96
Total 28,544,036.00 50,275,151.96
(2)Dividends receivable
1）Details
Items Closing balance Opening balance
common stock dividends 600,000.00
Total 600,000.00
（3） Other receivables
1）Details
① Details on categories
Closing balance
Categories Book balance Provision for bad debts
Carrying
Amount % to total Amount Provision amount
proportion (%)
Receivables with provision made
31,098,272.43 45.48 31,098,272.43 100.00
on an individual basis
199
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Closing balance
Categories Book balance Provision for bad debts
Carrying
Amount % to total Amount Provision amount
proportion (%)
Receivables with provision
37,273,951.38 54.52 9,329,915.38 25.03 27,944,036.00
made on a collective basis
Total 68,372,223.81 100.00 40,428,187.81 59.13 27,944,036.00
(Continued)
Opening balance
Categories Book balance Provision for bad debts
Carrying
Amount % to total Amount Provision amount
proportion (%)
Receivables with provision made
33,010,009.04 36.68 33,010,009.04 100.00
on an individual basis
Receivables with provision
56,983,224.19 63.32 6,708,072.23 11.77 50,275,151.96
made on a collective basis
Total 89,993,233.23 100.00 39,718,081.27 44.13 50,275,151.96
2) Other receivables with provision made on an individual basis
Provision
Debtors Book balance Provision for bad Reasons for
proportion
debts provision made
(%)
Beijing Likangpu
Communication Equipment 28,912,122.71 28,912,122.71 100.00 Unable to collect
Co., Ltd.
Putian Communications Unable to collect
2,186,149.72 2,186,149.72 100.00
(Hong Kong) Co., Ltd.
Subtotal 31,098,272.43 31,098,272.43
3) Other receivables with provision made on a collective basis
Closing balance
Portfolios
Book balance Provision for bad debts Provision proportion (%)
Aging combination 14,094,253.50 9,329,915.38 66.20
Portfolio-Financing
1,578,947.37
margin
Portfolio-Other 21,600,750.51
Subtotal 37,273,951.38 9,329,915.38 25.03
(2) Ages
Items Closing book balance Opening book balance
Within 1 year 21,361,891.68 38,298,614.15
1-2 years 2,121,917.36 5,217,214.31
2-3 years 4,335,634.46 7,373,694.63
3-4 years 3,821,379.29 1,648,262.87
200
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
4-5 years 1,493,262.87 1,321,643.00
Over 5 years 35,238,138.15 36,133,804.27
Subtotal/Total 68,372,223.81 89,993,233.23
(3) Changes in provision for bad debts
Phase I Phase II Phase III
Lifetime
Items 12 month expected Lifetime expected Subtotal
expected credit credit losses credit losses (credit
losses (credit not impaired)
impaired)
Opening balance 480,904.58 39,237,176.69 39,718,081.27
Opening balance in
—— —— ——
current period
--Transferred to phase II
--Transferred to phase III -3,446,032.15 3,446,032.15 -
--Reversed to phase II
--Reversed to phase I
Provision made in current
3,215,882.21 -2,505,775.67 710,106.54
period
Provision recovered in
current period
Provision reversed in
current period
Provision written off in
current period
Other changes
Closing balance 250,754.64 - 40,177,433.17 40,428,187.81
(4) Other receivables categorized by nature
Nature of receivables Closing balance Opening balance
Temporary advance payment receivable 58,684,606.32 76,617,770.01
Deposit as security 6,554,054.67 10,992,593.44
Travel reserve fund 691,088.20 796,798.91
Others 2,442,474.62 1,586,070.87
Total 68,372,223.81 89,993,233.23
(5) Details of the top 5 debtors with largest balances
Proportion to the
Debtors Nature of Book balance Ages Provision for
total balance of other
receivables bad debts
receivables (%)
Temporary
Beijing Likangpu
advance Over 5 years
Communication 28,912,122.71 42.29 28,912,122.71
payment
Equipment Co., Ltd.
receivable
Nanjing Nanman Temporary
advance 18,867,500.00 Over 1 years 27.60
Electric Co., Ltd
payment
201
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Proportion to the
Debtors Nature of Book balance Ages Provision for
total balance of other
receivables bad debts
receivables (%)
receivable
Nanjing Putian Temporary
Communication advance 1-4years
2,733,250.51 4.00
Technology Co., payment
Ltd receivable
Putian
Communication Over 5 years
Rent, utilities 2,186,149.72 3.20 2,186,149.72
(Hong Kong) Co.,
Ltd
Far East
Deposit as 2-3 years
International 1,578,947.37 2.31
security
Leasing Co.,Ltd.
Subtotal 54,277,970.31 79.39 31,098,272.43
3. Long-term equity investments
(1) Details
Closing balance Opening balance
Items
Provision for Carrying Provision for Carrying
Book balance Book balance
impairment amount impairment amount
Investments in
115,319,588.64 1,910,520.00 113,409,068.64 115,319,587.64 1,910,520.00 113,409,067.64
subsidiaries
Investments in
associates and 10,422,193.15 10,422,193.15 10,422,056.96 10,422,056.96
joint ventures
Total 125,741,781.79 1,910,520.00 123,831,261.79 125,741,644.60 1,910,520.00 123,831,124.60
(2) Investments in subsidiaries
Provision for
Closing balance
Investees Opening balance Increase Decrease Closing balance impairment
of provision for
made in current
impairment
period
Nanjing Putian Changle
Telecommunications 2,610,457.00 2,610,457.00
Equipment Co., Ltd.
Nanjing Putian Telege
3,320,003.45 3,320,003.45
Intelligent Building Ltd.
Nanjing South
Telecommunications Company 33,175,148.00 33,175,148.00
Limited
Nanjing Nanman Electrics Co.,
57,831,011.71 1.00 57,831,012.71
Ltd.
Nanjing Putian Network Co.,
7,741,140.41 7,741,140.41
Ltd.
Nanjing Putian Datang
Information Electronic Co., 5,436,797.07 5,436,797.07
Ltd.
Nanjing Putian
Telecommunication 1,294,510.00 1,294,510.00
Technology Co., Ltd.
Putian Telecommunications
1,910,520.00 1,910,520.00 1,910,520.00
(H.K.) Co., Ltd.
Chongqing Puhua Information
2,000,000.00 2,000,000.00
Technology Co., Ltd
202
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Provision for
Closing balance
Investees Opening balance Increase Decrease Closing balance impairment
of provision for
made in current
impairment
period
Subtotal 115,319,587.64 1.00 115,319,588.64 1,910,520.00
(3) Investments in associates and joint ventures
Increase/Decrease
Investees Opening balance Investment income Adjustment in other
Investments Investments
recognized under comprehensive
increased decreased
equity method income
Joint ventures
SEI-Nanjing Potevio
Optical Network Co., 10,422,056.96 136.19
Ltd.
Subtotal 10,422,056.96 136.19
Total 10,422,056.96 136.19
(Continued)
Increase/Decrease
Closing
Investees Cash balance of
Closing balance
Changes in dividend/Profit Provision for provision for
Others impairment
other equity declared for impairment
distribution
Joint ventures
SEI-Nanjing
Potevio Optical 10,422,193.15
Network Co., Ltd.
Subtotal 10,422,193.15
Total 10,422,193.15
(II) Notes to items of the parent company income statement
1. Operating revenue/Operating cost
Current period cumulative Preceding period comparative
Items
Revenue Cost Revenue Cost
Main operations 109,762,989.18 98,939,817.40 189,850,952.52 182,844,309.33
Other operations 11,490,076.50 9,759,140.72 14,466,948.04 16,357,549.35
Total 121,253,065.68 108,698,958.12 204,317,900.56 199,201,858.68
(2) Breakdown of revenue by main categories
Video Low voltage
Reportable Generic
conference distribution Others Subtotal
segments products
products products
Revenue
recognition time
203
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Goods
(transferred at a 121,253,065.68 121,253,065.68
point in time)
Services
(rendered over
time)
Total 121,253,065.68 121,253,065.68
（3） The revenue recognized in the current period included in the book value of contract liabilities at the
beginning of the period is 7,483,448.32 yuan.
2. Investment income
Items Current period cumulative Preceding period comparative
Investment income from long-term
equity investments under cost 9,753,400.00 82,727,700.00
method
Investment income from long-term
equity investments under equity 136.19 -4,769,983.62
method
Gains on disposal of long-term
79,250,527.14
equity investments
Gains from derecognition of
2,434,384.72 -952,176.00
financial assets at amortized cost
Total 12,187,920.91 156,256,067.52
XV. Other supplementary information
(I) Non-recurring profit or loss
1. Schedule of non-recurring profit or loss
(1) Details
Items Amount Remarks
Gains on disposal of non-current assets, including write-off -134,892.35
of provision for impairment
Government grants included in profit or loss (excluding
those closely related to operating activities of the
Company, satisfying government policies and 660,727.46
regulations, and continuously enjoyed with certain
quantity/quota based on certain standards)
Profit and loss from debt restructuring 2,456,389.38
Other non-operating revenue or expenditures 328,880.05
Subtotal 3,311,104.54
Less: Enterprise income tax affected 108,335.97
Non-controlling interest affected (after tax) 365,425.45
Net non-recurring profit or loss attributable to shareholders 2,837,343.12
of the parent company
204
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
(II) RONA and EPS
1. Details
EPS (yuan/share)
Profit of the reporting period Weighted average
RONA (%) Basic EPS Diluted EPS
Net profit attributable to shareholders
-105.00 -0.65 -0.65
of ordinary shares
Net profit attributable to shareholders
of ordinary shares after deducting -107.15 -0.66 -0.66
non-recurring profit or loss
2. Calculation process of weighted average RONA
Items Symbols Current period
cumulative
Net profit attributable to shareholders of ordinary shares A -138,766,373.70
Non-recurring profit or loss B 2,837,343.12
Net profit attributable to shareholders of ordinary shares after C=A-B -141,603,716.82
deducting non-recurring profit or loss
Opening balance of net assets attributable to shareholders of D 189,624,160.92
ordinary shares
Net assets attributable to shareholders of ordinary shares
increased due to offering of new shares or conversion of E
debts into shares
Number of months counting from the next month when the F
net assets were increased to the end of the reporting period
Net assets attributable to shareholders of ordinary shares
decreased due to share repurchase or cash dividends G
appropriation
Number of months counting from the next month when the H
net assets were decreased to the end of the reporting period
Retranslation I 34,293.83
Increase in purchase of minority interests in
14,295,331.64
the current period
Others Number of months counting from the next
month when other net assets were increased
J 10
or decreased to the end of the reporting
period
Number of months in the reporting period K 12
Weighted average net assets L= D+A/2+
132,153,750.44
E×F/K-G×H/K±I×J/K
Weighted average RONA M=A/L -105.00%
Weighted average return on net assets after deducting non
N=C/L -107.15%
recurring profits and losses (%)
3. Calculation process of basic EPS and diluted EPS
(1) Calculation process of basic EPS
Items Symbols Current period
cumulative
205
Nanjing Putian Telecommunications Co., Ltd. 2021 Annual Report
Items Symbols Current period
cumulative
Net profit attributable to shareholders of ordinary shares A -138,766,373.70
Non-recurring profit or loss B 2,837,343.12
Net profit attributable to shareholders of ordinary shares after C=A-B -141,603,716.82
deducting non-recurring profit or loss
Opening balance of total shares D 215,000,000.00
Number of shares increased due to conversion of reserve to E
share capital or share dividend appropriation
Number of shares increased due to offering of new shares or F
conversion of debts into shares
Number of months counting from the next month when the G
share was increased to the end of the reporting period
Number of shares decreased due to share repurchase H
Number of months counting from the next month when the I
share was decreased to the end of the reporting period
Number of shares decreased in the reporting period J
Number of months in the reporting period K 12
Weighted average of outstanding ordinary shares L=D+E+F×G/K-H×I/
215,000,000.00
K-J
Basic EPS M=A/L -0.65
Basic EPS after deducting non-recurring profit or loss N=C/L -0.66
Calculation process of diluted EPS is the same as calculation process of basic EPS.
Board of Directors of
Nanjing Putian Telecommunications Co., Ltd.
26 April 2022
206
