Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Tsann Kuen (China) Enterprise Co., Ltd.
Report for the First Quarter of 2019
April 2019
1
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Section I Important Statements
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and
senior management staff of Tsann Kuen (China) Enterprise Co., Ltd. (hereinafter referred to
as “the Company”) warrant that this report is factual, accurate and complete without any
false record, misleading statement or material omission. And they shall be jointly and
severally liable for that.
All directors attended the board session for reviewing this report.
Mr. Pan Zhirong, company principal, and Mr. Wu Jianhua, head of the accounting work &
the accounting division (head of accounting) jointly declare that the financial statements
carried in this report are factual, accurate and complete.
This Report is prepared in both Chinese and English. Should there be any discrepancy
between the two versions, the Chinese version shall prevail.
2
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Section II Company Profile
I Key financial results
Whether the Company performed any retroactive adjustments to or restatement of its accounting data due to changes of accounting
policies or correction of accounting errors
√Yes □ No
Reason for retroactive adjustments or restatement
Changes of accounting policies
Unit: RMB
January-March January-March 2018 +/-%
Item
2019
Before After After
Operating revenues 414,109,550.74 319,364,654.64 319,364,654.64 29.67
Net profit attributable to shareholders of the Company 34,325,162.34 -21,878,234.79 -21,878,234.79 256.89
Net profit attributable to shareholders of the Company
-3,740,527.91 -27,785,628.47 -27,785,628.47 86.54
before exceptional profit and loss
Net operating cash flow 12,516,737.69 -8,842,593.74 -8,842,593.74 241.55
Basic earnings per share (RMB/share) 0.19 -0.12 -0.12 258.33
Diluted earnings per share (RMB/share) 0.19 -0.12 -0.12 258.33
Weighted average return on equity (%) 5.15% -3.65% -3.42% 8.57
31 December 2018 +/-%
Item 31 March 2019
Before After After
Total assets 1,819,660,315.84 1,842,514,750.64 1,843,714,884.35 -1.30
Net assets attributable to shareholders of the Company 682,534,140.64 648,801,684.35 649,617,105.07 5.07
Total share capital up to the former trading date before the disclosure:
Total share capital up to the former trading date before the disclosure (share) 185,391,680
Fully diluted EPS calculated by the newest share capital (RMB/share) 0.19
Reason for changes of accounting policies:
The Ministry of Finance issued the Accounting Standards for Business Enterprises No. 22-Recognition and Measurement of
Financial Instruments, Accounting Standards for Business Enterprises No. 23-Transfer of Financial Assets, Accounting Standards for
Business Enterprises No. 24-Hedge Accounting, Accounting Standards for Business Enterprises No. 37-Presentation of Financial
Instruments revised and printed in 2017 and required all companies listed domestically to implement the revised accounting
standards since 1 January 2019.
The standards state that, on the date of the standards implementation, enterprises shall classify and measure financial instruments in
accordance with regulations, and when the data of previous comparative financial statements are inconsistent with the stipulations of
the revised standards, no adjustment is necessary. The difference of financial instruments between its original book value and the new
book value after the new standards are implemented shall be recorded into the opening retained earnings for the year that the
standards are carried out, other composite income and other items of financial statements.
The Company changes the method of impairment provision for accounts receivable into “expected credit loss method” from
“incurred loss method” so as to withdraw the impairment provision for financial assets more timely and in full, reveal and control
credit risks of financial assets.
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Exceptional profit and loss
√ Applicable □ Not applicable
Unit: RMB
Item January-March 2019 Note
Profit/loss on disposal of non-current assets (including offset amount of asset
63,163,013.64
impairment provisions)
Tax rebates, reductions and exemptions due to approval beyond authority or
the lack of official approval documents
Government grants charged to the profit/loss for the Reporting Period
(except for the government grants closely related to the business of the
Company and given at a fixed quota or amount in accordance with the
2,617,767.00
State’s uniform standards)
Capital occupation charges on non-financial enterprises that are charged to
the profit/loss for the Reporting Period
Profit due to the situation where investment costs for the Company to obtain
subsidiaries, associates and joint ventures are lower than the enjoyable fair
value of identifiable net assets of investees when making investments
Profit/loss on non-monetary asset swap
Profit/loss on entrusting others with investments or asset management
Asset impairment provisions due to acts of God such as natural disasters
Profit/loss on debt restructuring
Restructuring costs in staff arrangement, integration, etc.
Profit/loss on the part over the fair value due to transactions with distinctly
unfair prices
Reporting Period net profit/loss of subsidiaries acquired through business
mergers under the same control from period-beginnings to merger dates
Profit/loss on contingencies irrelevant to the Company’s normal business
activities
Mainly the investment income
Profit/loss on fair value changes of transactional financial assets and of sales of forward foreign
liabilities & investment profit on disposal of transactional financial assets exchange contract, income
and liabilities as well as financial assets available for sale, except for 6,161,084.91 from changes in fair value, and
effectively hedging business related to normal business operations of the other current assets income
Company from wealth management
products
Impairment provision reversal for accounts receivable on which the
impairment test is carried out separately
Profit/loss on entrusted loans
Profit/loss on fair value changes in investing properties of which the
subsequent measurement is carried out adopting the fair value method
Effect on Reporting Period profit/loss when a one-off adjustment is made to
Reporting Period profit/Loss according to requirements of taxation,
accounting and other relevant laws and regulations
Custody fee income when entrusted with operations
Non-operating income and expense other than the above 25,429,312.58
Other profit/loss that meet the definition of exceptional profit/loss
Less: Income tax effects 23,023,063.59
Minority interests effects (after tax) 36,282,424.29
Total 38,065,690.25
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Explanation of why the Company classified an item as exceptional profit/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Profit and Loss,
or reclassified any exceptional profit/loss item given as an example in the said explanatory announcement to recurrent profit/loss
□ Applicable √ Not applicable
II Total number of shareholders at the period-end and shareholdings of top ten shareholders
1. Numbers of common shareholders and preference shareholders with resumed voting rights as well as
shareholdings of top ten shareholders
Unit: share
Total number of preference
Total number of common shareholders at the
15,972 shareholders with resumed voting 0
period-end
rights at the period-end
Shareholdings of top ten shareholders
Shareholding Number of Pledged or frozen shares
Nature of Number of
Name of shareholder percentage restricted shares Status of Number of
shareholder shares held
(%) held shares shares
Foreign
FORDCHEE DEVELOPMENT LIMITED 29.10% 53,940,530 0 N/A 0
corporation
Foreign
EUPA INDUSTRY CORPORATION LIMITED 13.09% 24,268,840 0 N/A 0
corporation
GUOTAI JUNAN SECURITIES(HONGKONG) Foreign
4.95% 9,181,449 0 N/A 0
LIMITED corporation
Foreign
FILLMAN INVESTMENTS LIMITED 2.49% 4,621,596 0 N/A 0
corporation
SHENWAN HONGYUAN SECURITIES (HK) Foreign
1.09% 2,016,752 0 N/A 0
CO., LTD. corporation
Domestic
CHEN YONGQUAN 1.03% 1,900,776 0 N/A 0
individual
Foreign
CHEN YONGQING 0.83% 1,538,949 0 N/A 0
individual
Foreign
CHEN LIJUAN 0.75% 1,381,334 0 N/A 0
individual
Domestic
DING XIAOLUN 0.62% 1,148,000 0 N/A 0
individual
Domestic
XU QIANMING 0.33% 618,259 0 N/A 0
individual
Shareholdings of top ten non-restricted shareholders
Number of Variety of shares
Name of shareholder unrestricted
shares held Variety Number
FORDCHEE DEVELOPMENT LIMITED 53,940,530 Domestically listed foreign shares 53,940,530
EUPA INDUSTRY CORPORATION LIMITED 24,268,840 Domestically listed foreign shares 24,268,840
GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED 9,181,449 Domestically listed foreign shares 9,181,449
FILLMAN INVESTMENTS LIMITED 4,621,596 Domestically listed foreign shares 4,621,596
SHENWAN HONGYUAN SECURITIES (HK) CO., LTD. 2,016,752 Domestically listed foreign shares 2,016,752
CHEN YONGQUAN 1,900,776 Domestically listed foreign shares 1,900,776
CHEN YONGQING 1,538,949 Domestically listed foreign shares 1,538,949
CHEN LIJUAN 1,381,334 Domestically listed foreign shares 1,381,334
DING XIAOLUN 1,148,000 Domestically listed foreign shares 1,148,000
XU QIANMING 618,259 Domestically listed foreign shares 618,259
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
The first, the second and the fourth largest shareholders are the Company’s
corporate controlling shareholders. It is unknown to the Company whether
Related or acting-in-concert parties among the above there exists associated relationship among the shareholders above or they
shareholders are acting-in-concert entities as stipulated in the Administrative Measures
on Information Disclosure of Changes in Shareholding of Listed
Companies.
Did any of the top ten common shareholders or the top ten non-restricted common shareholders of the Company conduct any
promissory repo during the Reporting Period?
□ Yea √ No
No such cases in the Reporting Period.
2. Total number of preference shareholders and shareholdings of the top ten of them
□ Applicable √ Not applicable
Section III Significant Events
I Changes in major accounting statement items and financial indicators for the Reporting
Period, as well as reasons for such changes
√ Applicable □ Not applicable
Unit: RMB
Item 31 March 2019 31 December 2018 +/-% Main reason for change
Financial assets measured at fair
value with fair value changes Evaluated gains on forward foreign exchange
2,896,800.00 1,440,700.00 101.07
included in the profit and loss contracts purchased at the end of 2018
for the Reporting Period
Completion of asset disposal for policy plant
Assets held for sale 0.00 4,311,436.92 -100.00
demolition Phase II in current period
Financial liabilities measured at
fair value with fair value
Evaluated losses on forward foreign exchange
changes included in the profit 215,100.00 0.00 100.00
contracts in current period
and loss for the Reporting
Period
Increase in corporate income tax and output tax
Taxes and fares payable 6,464,892.77 3,768,531.07 71.55
withdrawn in current period
Recognition of deferred income tax liabilities
Deferred income tax liabilities 48,731,708.89 27,505,224.10 77.17 from asset disposal for policy plant demolition
Phase II in current period
Item January-March 2019 January-March 2018 +/-% Main reason for change
Decrease in unrealized, evaluated foreign
Finance costs 4,612,813.65 11,665,399.89 -60.46
exchange loss in current period
Reversal of allowance for doubtful accounts
Asset impairment loss 100,325.01 -1,776,486.26 105.65 resulted from collection of payments from
customers in same period of last year
Increase in government subsidies in current
Other income 2,617,767.00 1,255,697.00 108.47
period
Gains on asset disposal for policy plant
Asset disposal income 63,163,013.64 327,372.40 19,193.93
demolition Phase II in current period
Gains on asset disposal for policy plant
Non-operating revenue 25,441,381.14 281,354.88 8,942.45
demolition Phase II in current period
Recognition of deferred income tax liabilities
Income tax expense 23,231,649.72 348,766.94 6,561.08 from asset disposal for policy plant demolition
Phase II in current period
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Item January-March 2019 January-March 2018 +/-% Main reason for change
Receipt of compensation for policy plant
Net operating cash flow 12,516,737.69 -8,842,593.74 241.55
demolition Phase II in current period
Increase in outflow of restricted fixed time
Net investing cash flow -89,510,560.55 -301,809,247.49 70.34
deposit of same period of last year
Decrease in distribution outflow for dividend
Net financing cash flow -1,589,694.76 -6,164,673.70 74.21
payment by TKL in current period
II Progress of significant events and analysis & explanations on their influence and solutions
√ Applicable □ Not applicable
1. Contingencies
As MTN Products, Inc. / Water Solutions (Hong Kong) Ltd. ("MTN / WSL") did not pay the relevant payment in time and fulfill
the order according to the contract, the subsidiary of the Company, TsannKuen (Zhangzhou) Enterprise Co., Ltd. submitted the
indictment to the SUPERIOR COURT OF CALIFORNIA COUNTY OF LOS ANGELES on 23 November 2016 to sue MTN / WSL
for payment of USD707,522.92 and USD1,402,940 for reserve losses, totaling USD2,110,462.92. As of the reporting date, the case is
still pending.
2. Progress of significant events
Website where the relevant
Overview of significant event Disclosure date
current announcement is disclosed
The controlling subsidiary company, Tsann Kuen China (Shanghai)
Enterprise Co., Ltd signed the Expropriation Compensation
16 January 2019 www.cninfo.com.cn
Agreement (second phase of the factory) and received the first
installment of expropriation compensation of RMB44,172,066.5.
The controlling subsidiary company, Tsann Kuen China (Shanghai)
Enterprise Co., Ltd signed the Expropriation Compensation
26 January 2019 www.cninfo.com.cn
Agreement (second phase of the factory) and received the final
installment of expropriation compensation of RMB44,172,066.5
III Commitments of the Company’s actual controller, shareholders, related parties and
acquirer, as well as the Company and other commitment makers, unfulfilled in this reporting
period
√ Applicable □ Not applicable
Time of
Commitment Commitment Period of
Commitment Contents making Fulfillment
maker type commitment
commitment
Commitment on share
reform
Commitment in the
acquisition report or
the report on equity
changes
Commitments made
upon the assets
replacement
Commitments made
upon first issuance or
refinance
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Time of
Commitment Commitment Period of
Commitment Contents making Fulfillment
maker type commitment
commitment
Commitment on
equity incentive
The Company’s
Based on the confidence on the
stocks resumed
continuous and stable development of
trading on
the Company, it committed to increase
December 31,
the shareholding if the Company’s stock
2012, but the
price lower than HKD2.40 per share
Company’s stock
after the implementation of the shares
price hasn’t met
contraction and trading resumption, and
the condition for
it would increase no more than 2%
shareholding
Commitment shares (i.e. 3.7078 million shares) of the
Other commitments FILLMAN increase (closing
on total shares issued by the Company December
made to minority INVESTMEN Longstanding price was lower
shareholding within one year since the date of initial 28, 2012
shareholders TS LIMITED than HKD2.40)
increase shareholding increase. If the plan on
since the date of
increasing holding 2% shares of the
trading
total shares is completed, if the stock
resumption,
price hasn’t reached the target price, it
FILLMAN
will perform relevant approval
Investment
procedures, and propose to CSRC on
Limited hasn’t
continuous implementation of
implemented the
shareholding increase by exemption of
shareholding
offering.
increase plan.
Commitment on share
Yes
reform
No such cases in the reporting period.
IV Operating result forecast for January-June 2019
Forecast of a possible deficit or considerable YoY change in the accumulative net profit made during the period from the beginning
of the year to the end of the next reporting period, as well as explanation of why:
□Applicable √ Not applicable
V Securities investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
VI Investments in derivative financial instruments
√ Applicable □ Not applicable
Unit: RMB’0,000
Ratio of
investment
amount at
Type of Investment Investment the end of
investment amount at Pursed in Sold in Amount amount Actual
Related-party Initial the period
Operating in Commencement Termination the this this provided profit/loss
Relation transaction investment at the end to the
party derivative date date beginning reporting reporting for for the
or not amount of the Company's
financial of the period period impairment period
period net asset at
instruments period
the end of
the period
(%)
Forward January 1, 201 March 31,
Bank Non-related No 36,894.16 22,778.24 14,115.92 13,794.50 23,099.66 33.84 438.75
forex 9 2019
Total 36,894.16 22,778.24 14,115.92 13,794.50 23,099.66 33.84 438.75
Source of investment funds All from the Company's own funds
Lawsuits No lawsuits
Disclosure date of the announcement about the board’s
2013-03-12
consent for the investment
Disclosure date of the announcement about the general
2013-05-18
meeting’s consent for the investment
1. Analysis on risks from holding of derivative products: gains or losses from difference between contracted exchange rate and market exchange
rate on value date.
2. Control measures:
(1) Principle: The purpose of the financial derivative operation is to avoid risks. The Company shall not conduct transactional operation for
other purposes than risk avoidance. The Company shall not conduct complex derivative trading above the actual operation needs and shall not
speculate in derivative trading with hedging as an excuse. The overall contractual amount for risk avoidance of the Company shall not exceed
Risk analysis and risk control measures for positions held the summation of the net risk exposure of the existing assets and liabilities and the net risk exposure of assets and liabilities arising from the
in derivatives in this reporting period (including but not operation of the Company in the coming year.
limited to market risk, liquidity risk, credit risk, (2) Staff requirements: Personnel taking part in the investment shall all fully understand the risks of derivative investment and strictly execute
operational risk, legal risk, etc.) the business operation and risk management mechanisms for derivative investment.
(3) Operation standardization: Before making a derivative investment, the Company shall rationally equip itself with professional personnel for
investment decision-making, business operation, risk control, etc. It shall also inquire and compare among various markets and products.
Besides, it shall strictly control the variety and size of derivative investment and try to choose derivative trading on exchange as much as
possible.
(4) Periodic evaluation: Derivative investments shall be evaluated at least twice for a month and the evaluation report shall be sent to a
high-ranking executive authorized by the Board of Directors. And a derivative investment report shall be sent to the Board of Directors annually.
The Company and its subsidiaries only need to submit to the Board of Directors of the subsidiaries.
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
(5) Loss limit: The investment loss on a single derivative and all the investment loss shall not exceed 20% of the total investment amount.
(6) Audit system: The audit department audits derivative product trading periodically and submits audit reports to relevant units.
(1) Gains on delivered derivatives in the Reporting Period were RMB 3.1465 million, and assessed gains on those undelivered were RMB 1.241
Changes in market price or fair value of derivatives million, of which, the rotation of forwards assessed gains on undelivered derivatives in the last year was RMB 1.4407 million.
invested in this reporting period (specific methods used (2) The former contracted bank provided monthly sheets of estimated exchange rates for the undue contracted forward exchanges on the last
and relevant assumption and parameter settings shall be trading day of the month.
disclosed for analysis of fair value of derivatives) (3) The profit and loss from fair value changes of the derivative was confirmed according to the difference between the contracted amount
undue by the month*the estimated exchange rate and the currency amount when bought in.
Significant changes in the Company’s accounting policies
and specific accounting principles for derivatives in this No significant changes
reporting period as compared to the prior period
Special opinions expressed by independent directors The Company has carried out a strict internal assessment for the financial derivative business and has established a corresponding supervision
concerning the Company’s derivatives investment and mechanism. We are of the opinion that the financial derivative business conducted by the Company is fairly necessary in its routine operation
risk control and is in compliance with relevant laws and regulations, with the risks controllable.
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
VII Visits paid to the Company in the Reporting Period for purposes of research,
communication, interview, etc.
√ Applicable □ Not applicable
Date of visit Way of visit Type of visitor Index to main inquiry information
Inquired of the operation of the
2019-02-27 Telephone communication Individual
Company, and the reform of B-share
Inquired of the operation and operating
2019-03-22 Telephone communication Individual
result forecast of the Company
VIII Illegal provision of guarantees for external parties
□ Applicable √ Not applicable
IX Occupation of the Company’s funds by the controlling shareholder or its related parties
for non-operating purposes
□ Applicable √ Not applicable
11
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Section IV Financial Statements
I Financial statements
1. Consolidated balance sheet
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB
Item 31 March 2019 31 December 2018
Current assets:
Monetary funds 460,577,475.15 469,692,295.47
Financial assets measured at fair value with fair value changes
2,896,800.00 1,440,700.00
included in the profit and loss for the Reporting Period
Derivative financial assets
Notes and accounts receivable 226,804,782.38 280,796,130.89
Of which: Notes receivable 150,000.00 200,000.00
Accounts receivable 226,654,782.38 280,596,130.89
Accounts paid in advance 2,270,686.20 2,668,796.33
Other accounts receivable 27,374,076.76 29,944,042.47
Of which: Interest receivable 577,196.15
Dividends receivable
Inventories 230,073,417.06 243,262,500.58
Assets held for sale 4,311,436.92
Non-current assets due within one year
Other current assets 593,824,357.99 527,497,484.82
Total current assets 1,543,821,595.54 1,559,613,387.48
Non-current assets:
Available-for-sale financial assets 40,000.00 40,000.00
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investments
Investment property 24,607,201.75 25,014,648.31
Fixed assets 186,262,040.67 191,073,302.46
Construction in progress 1,144,144.32 895,756.17
Productive living assets
Oil-gas assets
Intangible assets 27,434,685.33 27,771,236.03
R&D expense
Goodwill
Long-term deferred expenses 7,387,372.56 8,058,867.12
Deferred income tax assets 25,606,275.55 26,552,328.43
Other non-current assets 3,357,000.12 3,495,224.64
Total non-current assets 275,838,720.30 282,901,363.16
Total assets 1,819,660,315.84 1,842,514,750.64
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Item 31 March 2019 31 December 2018
Current liabilities:
Short-term borrowings 10,234,889.51 10,432,044.21
Financial liabilities measured at fair value with fair value
215,100.00
changes included in the profit and loss for the Reporting Period
Derivative financial liabilities
Notes and accounts payable 573,179,629.03 672,895,647.66
Accounts received in advance 11,712,883.38 9,747,158.90
Payroll payable 37,305,402.03 48,587,140.78
Taxes and fares payable 6,464,892.77 3,768,531.07
Other accounts payable 55,127,771.61 52,818,204.91
Of which: Interest payable 23,919.09
Dividends payable
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of securities
Payables for acting underwriting of securities
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 694,240,568.33 798,248,727.53
Non-current liabilities:
Long-term borrowings
Bonds payable
Of which: Preference shares
Perpetual bonds
Long-term accounts payable
Long-term payroll payable 367,193.38 361,923.23
Estimated liabilities
Deferred income
Deferred income tax liabilities 48,731,708.89 27,505,224.10
Other non-current liabilities
Total non-current liabilities 49,098,902.27 27,867,147.33
Total liabilities 743,339,470.60 826,115,874.86
Shareholders’ equity:
Share capital 185,391,680.00 185,391,680.00
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 296,808,965.79 296,808,965.79
Less: Treasury stock
Other composite income 4,525,603.04 5,924,132.67
Special reserves
Surplus reserves 37,770,482.76 37,804,354.59
Provisions for general risks
Retained profit 158,037,409.05 122,872,551.30
Total equity attributable to shareholders of the Company 682,534,140.64 648,801,684.35
Minority interests 393,786,704.60 367,597,191.43
Total shareholders’ equity 1,076,320,845.24 1,016,398,875.78
Total liabilities and shareholders’ equity 1,819,660,315.84 1,842,514,750.64
Legal representative: Pan Zhirong Chief of the accounting work: Wu Jianhua Chief of the accounting organ: Wu Jianhua
13
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
2. Balance sheet of the Company
Unit: RMB
Item 31 March 2019 31 December 2018
Current Assets:
Monetary funds 13,555,765.00 6,985,345.44
Financial assets measured at fair value with fair value changes
included in the profit and loss for the Reporting Period
Derivative financial assets
Notes and accounts receivable 11,422,448.23 16,443,882.91
Of which: Notes receivable 150,000.00 200,000.00
Accounts receivable 11,272,448.23 16,243,882.91
Accounts paid in advance 3,669.11 260,472.55
Other accounts receivable 2,404,308.19 2,213,373.51
Of which: Interest receivable
Dividends receivable
Inventories 7,989,068.43 9,339,180.06
Assets held for sale
Non-current assets due within one year
Other current assets 469,134.42 381,431.15
Total current assets 35,844,393.38 35,623,685.62
Non-current assets:
Available-for-sale financial assets 40,000.00 40,000.00
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investments 921,914,701.56 921,914,701.56
Investment property 29,280,670.55 29,863,349.12
Fixed assets 1,199,363.16 1,189,309.65
Construction in progress
Productive living assets
Oil-gas assets
Intangible assets 22,499.99 29,249.99
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 11,276,471.06 10,946,860.01
Other non-current assets 53,879.31
Total non-current assets 963,733,706.32 964,037,349.64
Total assets 999,578,099.70 999,661,035.26
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Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Item 31 March 2019 31 December 2018
Current liabilities:
Short-term borrowings
Financial liabilities measured at fair value with fair value
changes included in the profit and loss for the Reporting Period
Derivative financial liabilities
Notes and accounts payable 46,551,447.34 58,463,830.39
Accounts received in advance 1,434,164.96 1,708,795.17
Payroll payable 3,430,526.62 5,338,618.00
Taxes and fares payable 528,378.58 666,695.14
Other accounts payable 251,548,856.89 262,786,311.87
Of which: Interest payable
Dividends payable
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 303,493,374.39 328,964,250.57
Non-current liabilities:
Long-term borrowings
Bonds payable
Of which: Preference shares
Perpetual bonds
Long-term accounts payable
Long-term payroll payable
Estimated liabilities
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 303,493,374.39 328,964,250.57
Shareholders’ equity:
Share capital 185,391,680.00 185,391,680.00
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 271,490,289.82 271,490,289.82
Less: Treasury stock
Other composite income
Special reserves
Surplus reserves 37,770,482.76 37,804,354.59
Provisions for general risks
Retained profit 201,432,272.73 176,010,460.28
Total shareholders’ equity 696,084,725.31 670,696,784.69
Total liabilities and shareholders’ equity 999,578,099.70 999,661,035.26
Legal representative: Pan Zhirong Chief of the accounting work: Wu Jianhua Chief of the accounting organ: Wu Jianhua
15
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
3. Consolidated income statement
Unit: RMB
Item January-March 2019 January-March 2018
1. Operating revenues 414,109,550.74 319,364,654.64
Including: Sales revenue 414,109,550.74 319,364,654.64
2. Total operating costs 419,168,621.41 358,168,095.81
Including: Cost of sales 361,136,922.92 293,239,451.95
Taxes and surtaxes 3,171,428.43 3,143,568.77
Selling expenses 13,587,124.77 13,638,807.57
Administrative expenses 19,337,403.42 21,715,402.71
R&D expenses 17,222,603.21 16,541,951.18
Finance costs 4,612,813.65 11,665,399.89
Of which: Interest expenses 106,348.89 121,230.66
Interest revenue 2,046,820.39 2,727,723.26
Asset impairment loss 100,325.01 -1,776,486.26
Add: other income 2,617,767.00 1,255,697.00
Profit/loss on investment (“-” means loss) 4,920,084.91 5,902,804.29
Including: Share of profit in associates and joint ventures
Profit/loss on fair value changes (“-” means loss) 1,241,000.00 1,523,700.00
Income arising from disposal of assets (“-” means loss) 63,163,013.64 327,372.40
3. Operating profit (“-” means loss) 66,882,794.88 -29,793,867.48
Add: Non-operating revenue 25,441,381.14 281,354.88
Less: Non-operating expense 12,068.56 29,831.46
4. Total profit (“-” means loss) 92,312,107.46 -29,542,344.06
Less: Corporate income tax 23,231,649.72 348,766.94
5. Net profit (“-” means loss) 69,080,457.74 -29,891,111.00
5.1 Classified by operating continuity
5.1.1 Net profit from going concern (“-” means net loss) 69,080,457.74 -29,891,111.00
5.1.2 Net profit from discontinued operations (“-” means net loss)
5.2 Classified by ownership
5.2.1 Minority shareholders’ income (“-” means net loss) 34,755,295.40 -8,012,876.21
5.2.2 Net profit attributable to owners of the Company (“-” means
34,325,162.34 -21,878,234.79
net loss)
6. After-tax net amount of other composite income -1,877,502.36 -3,351,759.83
After-tax net amount of other composite income attributable to
-1,408,126.77 -2,513,819.87
shareholders of the Company
6.1 Other composite income that will not be reclassified to profit
or loss
6.1.1 Changes caused by remeasurements on defined benefit
pension schemes
6.1.2 Share of other comprehensive income of investees that will
not be reclassified to profit or loss under equity method
6.2 Other composite income that will be reclassified to profit or
-1,408,126.77 -2,513,819.87
loss
16
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Item January-March 2019 January-March 2018
6.2.1 Share of other comprehensive income of investees that will
be reclassified to profit or loss under equity method
6.2.2 Gain/Loss on changes in fair value of available-for-sale
financial assets
6.2.3 Gain/Loss arising from reclassification of held-to-maturity
investments to available-for-sale financial assets
6.2.4 Effective gain/loss on cash flow hedges
6.2.5 Differences arising from translation of foreign
-1,408,126.77 -2,513,819.87
currency-denominated financial statements
6.2.6 Other
After-tax net amount of other composite income attributable to
-469,375.59 -837,939.96
minority shareholders
7. Total composite income 67,202,955.38 -33,242,870.83
Attributable to shareholders of the Company 32,917,035.57 -24,392,054.66
Attributable to minority shareholders 34,285,919.81 -8,850,816.17
8. Earnings per share
8.1 Basic earnings per share 0.19 -0.12
8.2 Diluted earnings per share 0.19 -0.12
Where business mergers under the same control occurred in the Reporting Period, net profit achieved by the merged parties before
the business mergers was RMB 0.00, with the corresponding amount for the same period of last year being RMB0.00.
Legal representative: Pan Zhirong Chief of the accounting work: Wu Jianhua Chief of the accounting organ: Wu Jianhua
17
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
4. Income statement of the Company
Unit: RMB
Item January-March 2019 January-March 2018
1. Operating revenues 22,032,609.07 25,078,057.17
Less: Operating costs 18,531,455.88 20,332,971.17
Taxes and surtaxes 489,640.35 605,071.88
Selling expenses 1,301,565.65 1,754,858.63
Administrative expenses 1,523,173.90 1,433,363.89
R&D expenses
Finance costs -19,731.29 -1,065.19
Of which: Interest expenses
Interest revenue 22,891.31 4,646.80
Asset impairment loss 289,922.04 -251,973.27
Add: other income
Profit/loss on investment (“-” means loss) 25,443,358.87 33,547,555.83
Including: Share of profit in associates and joint ventures
Profit/loss on fair value changes (“-” means loss)
Income arising from disposal of assets (“-” means loss)
2. Operating profit (“-” means loss) 25,359,941.41 34,752,385.89
Add: Non-operating revenue 150,012.50 18,469.97
Less: Non-operating expense 4,632.00
3. Total profit (“-” means loss) 25,509,953.91 34,766,223.86
Less: Corporate income tax -216,704.97 16,826.32
4. Net profit (“-” means loss) 25,726,658.88 34,749,397.54
4.1 Net profit from going concern (“-” means net loss) 25,726,658.88 34,749,397.54
4.2 Net profit from discontinued operation (“-” means net loss)
5. After-tax net amount of other composite income
5.1 Other composite income that will not be reclassified to profit
or loss
5.1.1 Changes caused by remeasurements on defined benefit
pension schemes
5.1.2 Share of other comprehensive income of investees that
will not be reclassified to profit or loss under equity method
5.2 Other composite income that will be reclassified to profit or
loss
5.2.1 Share of other comprehensive income of investees that
will be reclassified to profit or loss under equity method
5.2.2 Gain/Loss on changes in fair value of available-for-sale
financial assets
5.2.3 Gain/Loss arising from reclassification of
held-to-maturity investments to available-for-sale financial assets
5.2.4 Effective gain/loss on cash flow hedges
5.2.5 Differences arising from translation of foreign
currency-denominated financial statements
5.2.6 Other
6. Total composite income 25,726,658.88 34,749,397.54
Legal representative: Pan Zhirong Chief of the accounting work: Wu Jianhua Chief of the accounting organ: Wu Jianhua
18
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
5. Consolidated cash flow statement
Unit: RMB
Item January-March 2019 January-March 2018
1. Operating cash flow:
Cash received from sale of commodities and rendering of service 470,292,109.02 421,714,037.46
Net increase in money deposits from customers and inter-bank placements
Net increase in loans from the Central Bank
Net increase in funds borrowed from other financial institutions
Cash received from premium of original insurance contracts
Net cash received from reinsurance business
Net increase in deposits of policy holders and investment fund
Net increase in disposal of financial assets measured at fair value with fair
value changes included in the profit and loss for the Reporting Period
Cash received from interest, handling charges and commissions
Net increase in loans from banks and other financial institutions
Net increase in funds in repurchase business
Tax refunds received 45,294,291.73 54,253,887.28
Other operating cash received 40,299,144.22 8,917,968.49
Subtotal of operating cash inflow 555,885,544.97 484,885,893.23
Cash paid for goods and services 423,416,730.73 388,927,995.77
Net increase in loans and advances to customers
Net increase in funds deposited in the Central Bank and inter-bank
placements
Cash for paying claims of original insurance contracts
Cash for paying interest, handling charges and commissions
Cash for paying policy dividends
Cash paid to and for employees 70,899,203.15 66,421,877.12
Taxes and fares paid 4,374,193.52 3,866,015.63
Other cash payment relating to operating activities 44,678,679.88 34,512,598.45
Subtotal of operating cash outflow 543,368,807.28 493,728,486.97
Net operating cash flow 12,516,737.69 -8,842,593.74
2. Investment cash flow:
Cash received from retraction of investments 97,734,524.30 46,450,800.00
Cash received from return on investments 2,037,009.88 1,396,650.10
Net cash received from disposal of fixed assets, intangible assets and other
67,196,727.16 287,716.15
long-term assets
Net cash received from disposal of subsidiaries or other business units
Other cash received relating to investment activities 34,369,502.82 62,300,000.00
Subtotal of investment cash inflow 201,337,764.16 110,435,166.25
Cash paid to acquire fixed assets, intangible assets and other long-term
16,968,527.22 13,979,813.74
assets
Cash paid for investment 160,681,186.08 40,000,000.00
Net increase in pledged loans
Net cash paid to acquire subsidiaries and other business units
Other cash payments relating to investment activities 113,198,611.41 358,264,600.00
Subtotal of investment cash outflow 290,848,324.71 412,244,413.74
Net investment cash flow -89,510,560.55 -301,809,247.49
19
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Item January-March 2019 January-March 2018
3. Financing cash flow:
Cash received from capital contributions
Including: Cash received from minority shareholder investments by
subsidiaries
Cash received as borrowings 5,108,330.63
Cash received from issuance of bonds
Other financing cash received 7,000,000.00
Subtotal of financing cash inflow 7,000,000.00 5,108,330.63
Repayment of borrowings
Cash paid for interest expenses and distribution of dividends or profit 8,589,694.76 11,273,004.33
Including: dividends or profit paid by subsidiaries to minority
8,481,119.62 11,182,518.61
shareholders
Other cash payments relating to financing activities
Sub-total of financing cash outflow 8,589,694.76 11,273,004.33
Net financing cash flow -1,589,694.76 -6,164,673.70
4. Effect of foreign exchange rate changes on cash and cash equivalents -2,236,584.61 -7,687,492.59
5. Net increase in cash and cash equivalents -80,820,102.23 -324,504,007.52
Add: Opening balance of cash and cash equivalents 448,492,295.47 564,381,960.88
6. Closing balance of cash and cash equivalents 367,672,193.24 239,877,953.36
Legal representative: Pan Zhirong Chief of the accounting work: Wu Jianhua Chief of the accounting organ: Wu Jianhua
20
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
6. Cash flow statement of the Company
Unit: RMB
Item January-March 2019 January-March 2018
1. Operating cash flow:
Cash received from sale of commodities and rendering of service 16,891,797.09 22,858,389.74
Tax refunds received
Other operating cash received 12,140,390.98 10,659,931.71
Subtotal of operating cash inflow 29,032,188.07 33,518,321.45
Cash paid for goods and services 20,998,592.16 35,107,058.89
Cash paid to and for employees 773,062.49 704,419.01
Taxes and fares paid 1,818,111.09 1,021,402.40
Other operating cash payments 24,252,801.23 13,419,027.17
Subtotal of operating cash outflow 47,842,566.97 50,251,907.47
Net operating cash flow -18,810,378.90 -16,733,586.02
2. Investment cash flow:
Cash received from retraction of investments
Cash received from return on investments 25,443,358.87 33,547,555.83
Net cash received from disposal of fixed assets, intangible assets and other
long-term assets
Net cash received from disposal of subsidiaries or other business units
Other cash received relating to investment activities
Subtotal of investment cash inflow 25,443,358.87 33,547,555.83
Cash paid to acquire fixed assets, intangible assets and other long-term
62,500.00
assets
Cash paid for investment
Net cash paid to acquire subsidiaries and other business units
Other investment cash payments
Subtotal of investment cash outflow 62,500.00 0.00
Net investment cash flow 25,380,858.87 33,547,555.83
3. Financing cash flow:
Cash received from capital contributions
Cash received as borrowings
Cash received from issuance of bonds
Other financing cash received
Subtotal of financing cash inflow
Repayment of borrowings
Cash paid for interest expenses and distribution of dividends or profit
Other cash payments relating to financing activities
Sub-total of financing cash outflow
Net financing cash flow
4. Effect of foreign exchange rate changes on cash and cash equivalents -60.41 -76.06
5. Net increase in cash and cash equivalents 6,570,419.56 16,813,893.75
Add: Opening balance of cash and cash equivalents 6,985,345.44 5,342,389.95
6. Closing balance of cash and cash equivalents 13,555,765.00 22,156,283.70
Legal representative: Pan Zhirong Chief of the accounting work: Wu Jianhua Chief of the accounting organ: Wu Jianhua
21
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
II Adjustments to the Financial Statements
1. Adjustments to the financial statements at the beginning of the first execution year of any New Standards
Governing Financial Instruments, Revenue or Leases
√ Applicable □ Not applicable
Retroactive restatement of consolidated balance sheet
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD. Unit: RMB
Item 1 January 2019 31 December 2018 Adjusted
Current assets:
Monetary funds 469,692,295.47 469,692,295.47
Financial assets measured at fair value with fair value
1,440,700.00 1,440,700.00
changes included in the profit and loss for the Reporting Period
Derivative financial assets
Notes and accounts receivable 282,087,350.72 280,796,130.89 1,291,219.83
Of which: Notes receivable 200,000.00 200,000.00
Accounts receivable 281,887,350.72 280,596,130.89 1,291,219.83
Accounts paid in advance 2,668,796.33 2,668,796.33
Other accounts receivable 29,944,042.47 29,944,042.47
Of which: Interest receivable
Dividends receivable
Inventories 243,262,500.58 243,262,500.58
Assets held for sale 4,311,436.92 4,311,436.92
Non-current assets due within one year
Other current assets 527,497,484.82 527,497,484.82
Total current assets 1,560,904,607.31 1,559,613,387.48 1,291,219.83
Non-current assets:
Available-for-sale financial assets 40,000.00 40,000.00
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investments
Investment property 25,014,648.31 25,014,648.31
Fixed assets 191,073,302.46 191,073,302.46
Construction in progress 895,756.17 895,756.17
Productive living assets
Oil-gas assets
Intangible assets 27,771,236.03 27,771,236.03
R&D expense
Goodwill
Long-term deferred expenses 8,058,867.12 8,058,867.12
Deferred income tax assets 26,461,242.31 26,552,328.43 -91,086.12
Other non-current assets 3,495,224.64 3,495,224.64
Total non-current assets 282,810,277.04 282,901,363.16 -91,086.12
Total assets 1,843,714,884.35 1,842,514,750.64 1,200,133.71
22
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Retroactive restatement of consolidated balance sheet (Continued)
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD. Unit: RMB
Item 1 January 2019 31 December 2018 Adjusted
Current liabilities:
Short-term borrowings 10,432,044.21 10,432,044.21
Financial liabilities measured at fair value with fair value
changes included in the profit and loss for the Reporting Period
Derivative financial liabilities
Notes and accounts payable 672,895,647.66 672,895,647.66
Accounts received in advance 9,747,158.90 9,747,158.90
Payroll payable 48,587,140.78 48,587,140.78
Taxes and fares payable 3,768,531.07 3,768,531.07
Other accounts payable 52,818,204.91 52,818,204.91
Of which: Interest payable 23,919.09 23,919.09
Dividends payable
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 798,248,727.53 798,248,727.53
Non-current liabilities:
Long-term borrowings
Bonds payable
Of which: Preference shares
Perpetual bonds
Long-term accounts payable
Long-term payroll payable 361,923.23 361,923.23
Estimated liabilities
Deferred income
Deferred income tax liabilities 27,505,224.10 27,505,224.10
Other non-current liabilities
Total non-current liabilities 27,867,147.33 27,867,147.33
Total liabilities 826,115,874.86 826,115,874.86
Shareholders’ equity:
Share capital 185,391,680.00 185,391,680.00
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 296,808,965.79 296,808,965.79
Less: Treasury stock
Other composite income 5,933,729.81 5,924,132.67 9,597.14
Special reserves
Surplus reserves 37,770,482.76 37,804,354.59 -33,871.83
Provisions for general risks
Retained profit 123,712,246.71 122,872,551.30 839,695.41
Total equity attributable to shareholders of the Company 649,617,105.07 648,801,684.35 815,420.72
Minority interests 367,981,904.42 367,597,191.43 384,712.99
Total shareholders’ equity 1,017,599,009.49 1,016,398,875.78 1,200,133.71
Total liabilities and shareholders’ equity 1,843,714,884.35 1,842,514,750.64 1,200,133.71
23
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Explanation of adjustments
According to the revised and printed Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of
Financial Instruments, Accounting Standards for Business Enterprises No. 23 – Transfer of Financial Assets, Accounting Standards
for Business Enterprises No. 24 – Hedging Accounting, and Accounting Standards for Business Enterprises No. 37 – Presentation of
Financial Instruments issued by Ministry of Finance in 2017, enterprises listed domestically shall implement it from 1 January 2019.
The Company shall classify and measure financial instruments on implementation date of the standards in accordance with the
regulations. No adjustment is needed if the previous comparative data of financial statements are inconsistent with the requirements
of the standards. The balance between the original carrying value of financial instruments and the new carrying value on
implementation date of the standards shall recorded into the items of beginning retained earnings, other comprehensive income and
other items of financial statements during the reporting period of implementation date of the standards.
The Company shall change withdrawal method of accounts receivable impairment from “incurred loss method” to “expected credit
loss method” in order to make provision for financial assets impairment more timely and sufficiently, revealing and controlling credit
risks of financial assets.
24
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Retroactive restatement of balance sheet
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD. Unit: RMB
Item 1 January 2019 31 December 2018 Adjusted
Current assets:
Monetary funds 6,985,345.44 6,985,345.44
Financial assets measured at fair value with fair value
changes included in the profit and loss for the Reporting Period
Derivative financial assets
Notes and accounts receivable 15,992,258.57 16,443,882.91 -451,624.34
Of which: Notes receivable 200,000.00 200,000.00
Accounts receivable 15,792,258.57 16,243,882.91 -451,624.34
Accounts paid in advance 260,472.55 260,472.55
Other accounts receivable 2,213,373.51 2,213,373.51
Of which: Interest receivable
Dividends receivable
Inventories 9,339,180.06 9,339,180.06
Assets held for sale
Non-current assets due within one year
Other current assets 381,431.15 381,431.15
Total current assets 35,172,061.28 35,623,685.62 -451,624.34
Non-current assets:
Available-for-sale financial assets 40,000.00 40,000.00
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investments 921,914,701.56 921,914,701.56
Investment property 29,863,349.12 29,863,349.12
Fixed assets 1,189,309.65 1,189,309.65
Construction in progress
Productive living assets
Oil-gas assets
Intangible assets 29,249.99 29,249.99
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 11,059,766.09 10,946,860.01 112,906.08
Other non-current assets 53,879.31 53,879.31
Total non-current assets 964,150,255.72 964,037,349.64 112,906.08
Total assets 999,322,317.00 999,661,035.26 -338,718.26
25
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Retroactive restatement of balance sheet (Continued)
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD. Unit: RMB
Item 1 January 2019 31 December 2018 Adjusted
Current liabilities:
Short-term borrowings
Financial liabilities measured at fair value with fair value
changes included in the profit and loss for the Reporting Period
Derivative financial liabilities
Notes and accounts payable 58,463,830.39 58,463,830.39
Accounts received in advance 1,708,795.17 1,708,795.17
Payroll payable 5,338,618.00 5,338,618.00
Taxes and fares payable 666,695.14 666,695.14
Other accounts payable 262,786,311.87 262,786,311.87
Of which: Interest payable
Dividends payable
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 328,964,250.57 328,964,250.57
Non-current liabilities:
Long-term borrowings
Bonds payable
Of which: Preference shares
Perpetual bonds
Long-term accounts payable
Long-term payroll payable
Estimated liabilities
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 328,964,250.57 328,964,250.57
Shareholders’ equity:
Share capital 185,391,680.00 185,391,680.00
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 271,490,289.82 271,490,289.82
Less: Treasury stock
Other composite income
Special reserves
Surplus reserves 37,770,482.76 37,804,354.59 -33,871.83
Provisions for general risks
Retained profit 175,705,613.85 176,010,460.28 -304,846.43
Total shareholders’ equity 670,358,066.43 670,696,784.69 -338,718.26
Total liabilities and shareholders’ equity 999,322,317.00 999,661,035.26 -338,718.26
Explanation of adjustments
According to the revised and printed Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of
Financial Instruments, Accounting Standards for Business Enterprises No. 23 – Transfer of Financial Assets, Accounting Standards
for Business Enterprises No. 24 – Hedging Accounting, and Accounting Standards for Business Enterprises No. 37 – Presentation of
26
Report for the First Quarter of 2019 of Tsann Kuen (China) Enterprise Co., Ltd.
Financial Instruments issued by Ministry of Finance in 2017, enterprises listed domestically shall implement it from 1 January 2019.
The Company shall classify and measure financial instruments on implementation date of the standards in accordance with the
regulations. No adjustment is needed if the previous comparative data of financial statements are inconsistent with the requirements
of the standards. The balance between the original carrying value of financial instruments and the new carrying value on
implementation date of the standards shall recorded into the items of beginning retained earnings, other comprehensive income and
other items of financial statements during the reporting period of implementation date of the standards.
The Company shall change withdrawal method of accounts receivable impairment from “incurred loss method” to “expected credit
loss method” in order to make provision for financial assets impairment more timely and sufficiently, revealing and controlling credit
risks of financial assets.
2. Retrospective restatement of previous comparative data due to the first execution of any New Standards
Governing Financial Instruments or Leases
□ Applicable √ Not applicable
III Auditor’s report
Is this Report audited?
□ Yes √ No
This Report is not audited.
27
