Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Bingshan Refrigeration & Heat Transfer
Technologies Co., Ltd.
2022 Semiannual Report
August, 2022
1
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 1 Important Notice, Table of Contents, and Definitions
The directors and the Board of Directors, the supervisors and the
Supervisory Board, and Senior staff members of Bingshan Refrigeration &
Heat Transfer Technologies Co., Ltd.(hereinafter referred to as the Company)
hereby confirm that there are not any important omissions, fictitious
statements or serious misleading carried in this report, and shall take all
responsibilities, individual and/or joint, for the reality, accuracy and
completeness of the whole contents.
All directors have attended this Board meeting of the Company.
There is no significant risk having adverse influence on attainment of the
Company's future development strategy and business targets. The
paragraph " Management discussion and analysis" in Section 3 of this
Semiannual Report describes major risks , including the risk of increasing
market competition risk, the market promotion for new product and new
technology slow and the accounts receivable is on the high side. See the
related sections for the countermeasures to be taken by the Company.
The Company plans to distribute no cash dividends, no bonus shares and
convert no reserve fund into capital stock.
Chairman of the Board of Directors of the Company Mr. Ji Zhijian,
Financial Majordomo Mrs. Wang Jinxiu, and the head of Accounting
Department Mr. Li Sheng hereby confirm that the financial report of the
semi-annual report is true and complete.
This report is written respectively in Chinese and in English. In the event of
any discrepancy between the two above-mentioned versions, the Chinese
version shall prevail.
2
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
CONTENTS
Section 1 Important Notice, Table of Contents, and Definitions ...................................................... 2
Section 2 About the Company and Main Financia Indicators ........................................................... 6
Section 3 Management Discussion and Analysis ................................................................................. 8
Section 4 Corporate Governance ....................................................................................................... 15
Section 5 Environmental and Social Responsibility .......................................................................... 16
Section 6 Important Items .................................................................................................................. 17
Section 7 Change in Share Capital and Shareholders' Information ................................................. 19
Section 8 Information on Preferred Stock .......................................................................................... 21
Section 9 Bond Related Information .................................................................................................. 22
Section 10 Financial Report ............................................................................................................... 23
3
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Reference Documents
1. The accounting statements bearing the signatures and seals of the legal representative, the financial
majordomo and the accountants in charge.
2. The original copies of all the Company's documents and the original copies of the bulletins published on the
newspapers designated by the China Securities Regulatory Commission in the report period.
3. Time for reference: from Monday to Friday 8:00 - 11:30 (am) 1:00 - 4:30 (pm)
Liaison persons: Mr. Song Wenbao, Ms Du Yu
Tel: 0086-411-87968130
Fax: 0086-411-87968125
4
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Definitions
Defined item Stands for Meaning
Reporting period Stands for From Jan. 1, 2022 to Jun. 30, 2022
The Company, this Company Stands for Bingshan Refrigeration & Heat Transfer Technologies Co.,Ltd.
Dalian Bingshan Group Engineering Co., Ltd.,one of the subsidiaries of the Company where
Bingshan Engineering Company Stands for
the Company holds 100% of its shares.
Wuhan New World Refrigeration Industry Co., Ltd., one of the subsidiaries of the Company
Wuxin Refrigeration Stands for
where the Company holds 100% of its shares.
Dalian Bingshan Guardian Automation Co., Ltd. one of the subsidiaries of the Company
Bingshan Guardian Stands for
where the Company holds 100% of its shares.
Panasonic Appliances Compressor (Dalian) Co., Ltd. one of the associated companies of the
Panasonic Compressor Stands for
Company, where the Company holds 40% of its shares.
Panasonic Appliances Cold-Chain (Dalian) Co., Ltd. one of the associated companies of the
Panasonic Cold-Chain Stands for
Company, where the Company holds 40% of its shares.
Panasonic Appliances Refrigerating System (Dalian) Co., Ltd., one of the
Panasonic Refrigerating System Stands for
associated company of the Company, where the Company holds 20% of its shares
Jiangsu Jingxue Insulation Technology Co., Ltd., one of the associated companies of the
Jingxue Insulation Stands for
Company, where the Company holds 21.91% of its shares.
5
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 2 About the Company and Main Financial Indicators
I. Company information
Short form of the stock Bingshan; Bingshan B
Stock code 000530; 200530
Listed stock exchange Shenzhen Stock Exchange
Legal name in Chinese 冰山冷热科技股份有限公司
Short form of legal name 冰山冷热
Legal English name Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd.
Abbreviation of legal English name Bingshan
Legal representative Ji Zhijian
II. Contact persons and information
Secretary of the Board of Directors Authorized representative for securities affairs
Name Song Wenbao Du Yu
No.106, Liaohe East Road, Dalian Economic and No.106, Liaohe East Road, Dalian Economic and
Address
Technological Development Zone Technological Development Zone
Tel. 0411-87968130 0411-87968822
Fax 0411-87968125 0411-87968125
E-mail 000530@bingshan.com 000530@bingshan.com
III. Other situations
1. Contact of company
If the registered address, office address and zip code, website, email box of the Company had any change in the
report period
□ Applicable √ Not applicable
2. Information disclosure and place of preparation
If the information disclosure and the place of preparation had any change in the report period
□ Applicable √ Not applicable
The name of newspaper for information disclosure selected by the Company, the address of the website designated
by China Securities Regulatory Commission for carrying semi-annual report, the place where the semi-annual
report of the Company is prepared had no change in the report period. Refer to the Annual Report for 2021 for
details.
IV. Main accounting data and financial indicators
Did the Company retroactively adjust or restate the accounting data of previous years due to change in the
accounting policy and correction of accounting mistakes?
□ Applicable √ Not applicable
6
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Unit: RMB Yuan
Increase/decrease compared with
2022.1-6 2021.1-6
the same period of last year
Operating revenue 1,291,858,908.71 1,094,285,620.97 18.06%
Net profit attributable to shareholders of listed companies 29,568,351.52 -14,584,210.01 302.74%
Net profit belonging to the shareholders of listed companies
10,705,118.35 -11,882,674.61 190.09%
after the deduction of non-recurring profit and loss
Net cash flow from operating activities -189,406,336.85 -28,887,836.28 -555.66%
Basic earnings per share 0.035 -0.017 305.88%
Diluted earnings per share 0.035 -0.017 305.88%
Weighted average return on net asset yield 0.98% -0.43% Increase 1.41 percentage points
Increase/decrease compared with
2022.6.30 2021.12.31
2021.12.31
Total assets 5,841,301,503.15 5,735,570,604.67 1.84%
Owner's equity attributable to shareholders of listed companies 3,023,642,891.92 3,002,842,837.47 0.69%
V.1.Difference of accounting data between as per Chinese accounting standards and as per
International Accounting Standards
□ Applicable √ Not applicable
2. Difference of accounting data between as per Chinese accounting standards and as per
Foreign Accounting Standards
The difference of accounting data between as per Chinese Accounting Standards and as per International
Accounting Standards was 0.
VI. Non-recurring profits and losses and their amounts
item Amount
Disposal gains and losses of non-current asset 67,260.20
Government subsidies included in current profit or loss 1,984,170.62
When the investment cost of a subsidiary, associate or joint venture is less than that
of the investment, an enterprise shall enjoy the income generated by the fair value 2,834,620.63
of the identifiable net assets of the invested entity
Disposal gains from investments on financial assets available for sale, and gains
13,870,603.52
from fair value change of other non-current financial assets
Other non-operating revenue or expense 1,278,039.78
Influence on income tax 992,883.13
Influence on minority shareholders 178,578.45
Total 18,863,233.17
7
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 3 Management discussion and analysis
I. The Company’s Main business during the reporting period
Focusing on the hot and cold industry, the Company is committed to the development of industrial
refrigeration and heating business, commercial refrigeration business, air conditioning and environment
business, engineering and service business and new business fields, covering the key areas of the hot and cold
industry chain and creating a complete hot and cold industry chain.
The Company's main products include piston and screw refrigeration compressors, pressure vessels, combined
warehouses, controlled atmosphere storage, quick freezer, etc., which are used in national defense, scientific
research, petroleum, chemical, textile, medicine, power generation, agriculture, animal husbandry, fishery and
catering service industries. The Company's product sales and comprehensive solutions provide both domestic
and international markets, with self-supporting sales as the main and channel sales as the auxiliary.
During the reporting period, rigid demands such as food safety, consumption upgrading, energy conservation
and carbon reduction will benefit the refrigeration and air conditioning industry. At the same time, the
refrigeration and air conditioning industry is also facing the problems of intensified market competition,
increased cost pressure, and difficulty in improving efficiency. Facing the opportunities and challenges,
focusing on the hot and cold industry, the Company continued to deeply cultivate the advantageous market
segments, and actively expanded and occupied the domestic market.
1. Industrial refrigeration and heating business
Industrial refrigeration is an important field reflecting the core technology of the Company. After years of
development, the Company has been close to the technical level of the main international competitors in the
field of industrial refrigeration, and has achieved catching up in some fields. Based on the traditional
refrigeration, the Company realizes the balance of cold and heat through the utilization of heat, which greatly
improves the energy utilization rate.
2. Commercial refrigeration business
Commercial refrigeration is the Company's core business. In China, the Company takes the lead in opening up
the green intelligent cold chain from the first kilometer of the field to the last 100 meters of the residential
community, which is the competitive advantage of the Company.
Focusing on food refrigeration, the Company has patented products pre-cooling from the field, all kinds of
quick freezing equipment and refrigeration facilities of various specifications, and China's leading experience
in the design and installation of large-scale ammonia and carbon dioxide refrigerators. On the basis of
absorbing the relevant experience of Japan, Europe and the United States, combined with China's new needs,
to provide newer products, better solutions and fresher experience for the field of food freezing and
refrigeration.
3. Air conditioning and environment business
In recent years, relying on the complete industrial chain, the Company has continuously carried out
transformation and upgrading in the field of air conditioning and environment, developed more energy-saving
and environmental protection products around the blue sky project, and accelerated the transformation and
upgrading from air treatment to environmental governance.
At present, the Company has developed a series of innovative products around the market segments of
commercial air conditioning, central air conditioning and special air conditioning, and provides corresponding
solutions in different segments around these innovative products. For hospitals, electronic factories, high-end
real estate, rail transit and other fields, provide targeted solutions.
4. Engineering and service business
8
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Cold and hot engineering and service are the Company's advantageous business fields. In recent years, the
Company has realized transformation and upgrading from the manufacturer of cold and hot equipment to the
service provider of comprehensive solution of cold and hot through the development of engineering and
service industry, and realized the dual wheel drive of the enterprise, and provided more professional and
accurate services to each segment market, and constantly created new value for customers and realized
common growth.
At present, the Company focuses on petrochemical technology, refrigeration, central air conditioning, ice and
snow engineering, artificial environment and other market segments. Relying on the enterprise's industrial
chain, value chain and ecosystem, the Company provides services from consulting, planning, design to
manufacturing, installation, commissioning and service in the whole process and life cycle. At the same time,
according to the needs of customers, promote the combination of industry and finance, and provide services for
customers through the form of project general contracting and financial leasing.
5. New business
With the deepening of China's economic transformation and upgrading, as well as the continuous introduction
of environmental governance policies, the domestic industrial energy conservation and environmental
protection industry is growing rapidly, the level of energy conservation and consumption reduction of
enterprises and the comprehensive utilization of resources is constantly improving, and the energy industrial
structure has changed. Strengthening the optimal utilization of energy has become a development trend. For
low-grade energy recycling, the Company provides customers with a series of energy-saving, environmental
protection, efficient new products, in line with the national strategic requirements of energy conservation,
carbon reduction and sustainable development, and contributes professional wisdom to the national carbon
peak and carbon neutral strategy.
During the reporting period, the Company made good progress in CCUS, ORC, photovoltaic and other new
undertakings.
II. Analysis of core competence
The Company focuses on main business of cold and heat; independent R&D and joint venture partnerships are
cooperate with each other effectively; capital resources integration and business model innovation are in a positive
interaction; the community of business and interest are being multi-storey created; the develop mode with
Bingshan characteristic are formed.
The Company has the integrated cold-heat industrial chain for offering kinds of comprehensive solution services,
including design, manufacture, installation and maintenance etc., and can satisfy individual requirements
preferably.
The Company possesses a mature and solid marketing networks and after-sale service network on/off-line, and
can offer high quality and high value-added services more initiative and faster for clients from around the city.
After overall relocation reform, the new factory of intelligence, environment protection, high efficiency and safety
are put into used, which produces a strong comparative advantage for creating higher value to the customers.
While move forward with transformation and upgrading for former business, the Company will implement the
cultivation for new business, thus the sustainable healthy development will come more and more feasible.
Core-competency of the Company further promoted in the reporting period.
III. Analysis of main business
In the first half of 2022, the Company focused on hot and cold industries, continued to cultivate advantageous
market segments, solidly improved its core competitiveness, and accelerated the improvement of its main
business. In the first half of 2022, the Company achieved an operating revenue of 1,291.86 million yuan, an
increase of 18.06% year-on-year; The net profit attributable to the shareholders of the listed company was
29.57million yuan, turning losses into profits year on year.
9
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
During the reporting period, the Company adhered to integrity, innovation and pragmatic reform. Enrich and
strengthen the operation and management team, adjust and optimize the organizational structure and business
processes. Multiple strategies should be taken simultaneously to effectively improve production capacity and
production efficiency. With green refrigerant and zero carbon as the center and market segmentation as the
goal, we will solidly improve technology. The "national high-end equipment manufacturing standardization
pilot" passed the acceptance smoothly. The screw refrigeration unit for large ocean fishing vessels of the
Company was selected as the "specialized and special new" product of Liaoning Province in 2022.
During the reporting period, Bingshan Engineering company, a subsidiary of the Company, continued to
cultivate advantageous market segments. In the field of product business, actively serve high-end customers,
and sign a number of projects with BASF, Yabao, etc; Join hands with leading enterprises to lead the
polysilicon market. In the field of engineering, Xinjiang central kitchen project, Shanghai Star indoor
comprehensive ice and snow venue project and other landmark projects were constructed in an orderly manner.
In the field of energy, the implementation of CCUS projects has been accelerated, and carbon neutralization
solutions have been strongly expanded.
During the reporting period, Wuhan New World Refrigeration, a subsidiary of the Company, further optimized
its products and solutions. Based on the existing traditional products, focus on expanding the energy, coal and
LNG segment markets. The marketing of the main models of energy products has achieved good results, and
the steam screw compressor unit has achieved a breakthrough in the sales of new products.
During the reporting period, Bingshan Guardian, a subsidiary of the Company, focused on energy-saving
control of cooling and heating systems and made efforts to become stronger and bigger. Absorb and merge
New Meica to realize resource integration, complementary advantages and efficient operation. Won the bid for
the distribution box project of Dalian Bay Subsea Tunnel project, and helped Dalian key projects.
Independently develop comprehensive energy-saving algorithm, and launch the centralized monitoring
energy-saving system of IOT supermarket convenience stores with obvious energy-saving effect.
Main financial data variations as compared to the same period of last year
Monetary unit: RMB Yuan
Increase or decrease
Same period of last
Report period from the same period Reason for variation
year
of last year
Operating revenue 1,291,858,908.71 1,094,285,620.97 18.06%
Operating cost 1,131,915,209.09 950,404,769.26 19.10%
Selling and
distribution 55,209,408.15 56,710,524.65 -2.65%
expenses
Administrative
70,074,155.71 71,726,497.78 -2.30%
expenses
Financial expenses 5,470,355.43 6,240,668.73 -12.34%
Income tax 2,774,153.99 2,514,997.49 10.30%
R&D expenses 31,564,520.91 30,738,151.60 2.69%
Net cash flow Due to the substantial increase in orders, the
coming from -189,406,336.85 -28,887,836.28 -555.66% purchase volume and engineering
operating activities installation volume increased, and the cash
10
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
paid for purchasing goods and accepting
labor services increased
Net cash flow Increase in cash received from dividends of
coming from 70,350,256.80 26,104,458.71 169.50% associates and decrease in cash paid for
investment activities investments
Net cash flow
coming from
30,185,223.89 -57,923,362.57 152.11% Decrease in cash paid for debt repayment
fund-raising
activities
Net increase in cash
-87,256,638.78 -60,589,772.47 -44.01%
and cash equivalents
Sales income and costs
Report period Same period of last year Increase or decrease
Proportion to the Proportion to the from the same period
Amount Amount
Sales costs Sales costs of last year
Total sales income 1,291,858,908.71 100% 1,094,285,620.97 100% 25.29%
By industry
Refrigeration and
air-conditioning 1,246,624,682.46 96.50% 1,069,601,775.40 97.74% 16.55%
equipment
Others 45,234,226.25 3.50% 24,683,845.57 2.26% 83.00%
By product
Industrial products 912,396,566.62 70.63% 864,579,358.55 79.01% 5.53%
Installation project 328,784,059.27 25.45% 196,759,744.53 17.98% 67.10%
Other products and
50,678,282.82 3.92% 32,946,517.89 3.01% 53.82%
services
By region
Domestic sales 1,215,091,356.98 94.06% 1,036,222,666.10 94.69% 17.26%
Foreign sales 76,767,551.73 5.94% 58,062,954.87 5.31% 32.21%
Main business structure
Monetary unit: RMB yuan
Increase/decreas
Increase/decrease of
e of operating
Gross operating revenues Increase/decrease of gross profit
Operating revenue Operating costs costs from the
profit from the same period from the same period of last year
same period of
of last year
last year
By industry
Refrigeration and
1,246,624,682.46 1,101,097,130.75 11.67% 16.55% 17.19% Decrease0.49 percentage points
air-conditioning
By product
Industrial products 912,396,566.62 784,509,505.43 14.02% 5.50% 6.00% Decrease 0.51 percentage points
Installation project 328,784,059.27 312,879,375.49 4.84% 67.10% 62.50% Increase 2.36 percentage points
Other products and
5,444,056.57 3,708,249.83 31.88% -34.10% -47.90% Increase 18.09 percentage points
services
By region
Domestic sales 1,169,857,130.73 1,031,667,083.53 11.81% 15.65% 16.22% Decrease0.43 percentage points
Foreign sales 76,767,551.73 69,430,047.22 9.56% 32.21% 33.92% Decrease1.15 percentage points
11
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
IV. Analysis of the non-main business
√Applicable □Not applicable
unit: RMB yuan
In addition to the investment income from
one-time equity transfer, the investment
income from investment 83,743,763.15
income of the Company to the associated
companies is sustainable.
V. Analysis of assets & liabilities
1. Remarkable change in assets
Monetary unit: RMB yuan
30-6-2022 31-12-2021
Proportion
Proportion to Proportion increase/decrease.
Amount to the total Amount
the total assets
assets
Monetary funds 402,662,001.86 6.89% 522,658,505.79 9.11% Decrease 2.22percentage points
Accounts receivable 982,008,651.89 16.81% 821,548,678.85 14.32% Increase 2.49 percentage points
Contract assets 126,164,442.94 2.16% 109,859,658.79 1.92% Increase 0.24 percentage points
Inventories 1,053,998,091.18 18.04% 1,014,527,127.82 17.69% Increase 0.35 percentage points
Investment property 117,379,096.16 2.01% 120,752,809.61 2.11% Decrease 0.01 percentage points
Long-term equity
1,207,390,848.39 20.67% 1,231,504,533.45 21.47% Decrease 0.08 percentage points
investment
Fixed assets 831,680,902.75 14.24% 855,395,405.85 14.91% Decrease 0.67 percentage points
Construction in progress 50,556,431.55 0.87% 38,974,478.45 0.68% Decrease 019 percentage points
Right of use assets 16,107,591.26 0.28% 23,934,703.37 0.42% Decrease 0.14 percentage points
Short-term loans 240,000,000.00 4.11% 245,937,091.72 4.29% Decrease 0.18 percentage points
Contract liabilities 445,660,584.96 7.63% 499,719,963.40 8.71% Decrease 1.08percentage point
Long-term loans 140,000,000.00 2.40% 150,000,000.00 2.62% Decrease 0.22 percentage points
Lease liabilities 5,631,101.48 0.10% 5,394,021.14 0.09% Increase 0.01 percentage points
2. The main overseas assets
□ Applicable √ Not applicable
3. Assets & liabilities which are measured by fair value
√ Applicable □ Not applicable
The beginning number is 261,410,664.61 yuan for other non-current financial assets measured by fair value.
Changes in the profit and loss of the fair value in this period is-29,425,921.52 yuan，The amount sold in the
current period is 107,495,400.00 yuan, the current sale amount is 0 yuan, and the final number is167,515,974.19
yuan.
3. Restrictions on asset rights at the end of reporting period
√ Applicable □ Not applicable
Items 2022.6.30 Reasons
Monetary fund 50,887,086.77 Guarantee money
Notes Receivable 4,810,536.65 Pledge
Inventories 88,294,179.79 Pledge
Fixed assets 38,433,002.00 Pledge
Intangible assets 6,209,834.23 Pledge
12
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
VI. Analysis of investments
1.The overall situation
√ Applicable □ Not applicable
Investment in the report period (yuan) Investment in the same period of last year (yuan) Amount of variation
1,207,390,848.39 1,606,295,377.43 -24.83%
2.The significant equity investment during the reporting period
□ Applicable √ Not applicable
3 The significant non-equity investment during the reporting period
□Applicable √Not applicable
4.The financial asset investment
(1) The securities investment
√ Applicable □ Not applicable
Changes in the Accumulativ
Initial Accounting profit and loss e change of
Stock Stock Book value at Current sale Report period Book value in the Accounting Source
investment measurement of the fair fair value
code abbreviation the beginning amount profit and loss ending subjects of funds
cost model value in this credited to
period equity
Other
Guotai fair value Own
601211 10,910,008.00 195,180,043.12 -29,425,921.52 5,289,000.00 -22,007,116.08 165,832,121.60 Non-current
Jun’an measurement funds
financial assets
total 10,910,008.00 -- 195,180,043.12 -29,425,921.52 5,289,000.00 -22,007,116.08 165,832,121.60 --
(2) Derivative investment
□Applicable √ Not applicable
During the reporting period, the Company does not exist derivative investment.
VII. The material assets and equity sale
1. The material assets sale
□Applicable √Not applicable
2. The material equity sale
√ Applicable □ Not applicable
The Company transferred 17.80 percent equity of Suzhou Thermoking which was held by the Company with price
of RMB 102.2064 million yuan to Trane Technologies European Holding Company B.V. After the above
mentioned equity transfer finished, the Company will not hold equity of Suzhou Thermoking.
VIII. Analysis of major subsidiary companies and mutual shareholding companies
√ Applicable □ Not applicable
Unit: ten thousand yuan (except for registered capital)
Company name Type The main business registered capital total assets net assets Operating income Net profit
mutual
Panasonic
shareholding Scroll Compressor JPY 6,200 million 149,014.00 111,476.00 58,677.00 4,843.00
Compressor
company
mutual New building
Jing Xue RMB108,000
shareholding energy-saving board, 158,759.00 77,728.00 27,483.00 1,423.00
Insulation thousand
company refrigerated storage door
Bingshan Metal mutual Pipe system connectors, USD 18.0645 39,119.00 33,394.00 24,038.00 2,981.00
13
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Technology shareholding high-speed rail million
company connectors, hydraulic
valve bodies, automotive
engine parts, etc.
Production and sales of
commercial refrigeration
mutual
Panasonic equipment, cold storage,
shareholding JPY 4,650 million 223,961.00 16,987.00 107,604.00 -4,485.00
Cold-chain stainless steel kitchen
company
equipment and electrical
products
Subsidiary companies obtained or disposed in the reporting period
√ Applicable □ Not applicable
The Company transferred 100 percent equity of Bingshan Service which was held by the Company with price of
RMB 25.8882 million yuan. During the reporting period ,the equity transfer has been finished, the Company not
hod equity of Bingshan Service.
IX. The structured corporate bodies which the Company controlled
□Applicable √Not applicable
X. Main risks the company faces and response measures
(1)Increasing market competition risk
Countermeasures: focus on the hot and cold industry, deeply cultivate the advantage market segmentation; rapidly
improve the engineering and manufacturing power; orderly improve the level of intelligent manufacturing and
service-oriented manufacturing; speed up the transformation and upgrading of inherent undertakings; accelerate
the implementation of new kinetic energy cultivation; continue to build Bingshan enterprise and interest
community.
(2)Risk of slow marketing of new products and technologies
Countermeasures: create differentiated competitiveness of new products and technologies; strengthen the
technology marketing and service marketing, and cultivate the market segmentation professionally; appropriate
use of financial leasing, contract energy management and other innovative models.
(3)Risk of high level of trade receivables
Countermeasures: strictly implement the project management system and further strengthen the management of
accounts receivable; enhance quality of contract through intensified customer credit assessment and contract
appraisal; effective control of increase in trade receivables by reduction of guarantee deposits, and taking bank
credit instruments as guarantee deposits; improve contract execution through stricter review on goods delivery,
intensified control on project construction and acceptance, and post-sale service; prepare special composition
solutions and incentive policy to accelerate settlement of trade receivables with relatively long aging.
(4)Risk of rising raw material prices
Countermeasures: the Company will actively respond to cost pressure by reducing material rates, centralized
procurement, expanding sales, adjusting selling prices, reducing expenses and other measures.
14
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 4 Corporate governance
I. Shareholders’ general meeting convened in the reporting period
The proportion of
Session number of meeting The type of the meeting date Disclosing date Disclosing index
participate investors
The first Extraordinary General Meeting of Extraordinary Shareholders’ Jan http://www.cnin
29.37% Jan 13,2022
shareholders in 2022 General Meeting 12,2022 fo.com.cn
Annual Shareholders’ General May http://www.cnin
2021Annual Shareholders’ General Meeting 29.74% May 19,2022
Meeting 18,2022 fo.com.cn
II. Changes of directors, supervisors, senior managers of the Company
Name Position held Type Date Reason
Fan Wen Director be elected Jan12, 2022 The Board of directors changes, gets elected
Song Wenbao Director be elected Jan12, 2022 The Board of directors changes, gets elected
Dono Shigeru Director be elected Jan12, 2022 The Board of directors changes, gets elected
Vice General
Lu Jun be appointed Jan12, 2022 Appointed by the Board of Directors
Manager
Vice General
Yang Fuhua be appointed Jan12, 2022 Appointed by the Board of Directors
Manager
Vice chairman of
Yin Xide the board of be elected Jan12, 2022 be elected
directors
Leave office after
Xu Junrao Director Jan12, 2022 General election, leave office
the end of term
Leave office after
Yokoo Sadaaki Director Jan12, 2022 General election, leave office
the end of term
Vice chairman of
Leave office after
Ding Jie the board of Jan12, 2022 General election, leave office
the end of term
directors
III. Profit distribution and dividend payment
□ Applicable √ Not applicable
IV．The implementation and effect of equity incentive
□ Applicable √ Not applicable
15
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 5 Environmental and social responsibility
I．Major environmental issues
The listed company and its subsidiaries whether belong to heavy pollution industry formulated by the state
environmental protection department
□Yes √ No
Administrative penalties imposed for environmental problems during the reporting period
□Yes √ No
Main Distribution Pollutant
Number of Total Excessiv
pollutant Way of of the Emission discharge Total
Enterprise or subsidiary discharge approved e
and discharge discharge concentration standard discharge
outlet emissions emission
features outlet implemented
Bingshan Refrigeration & Heat Unified DB21 Not over
COD sequence 1 129 ㎎/L 1.807tons None
Transfer Technologies Co., Ltd. discharged standard
1627-2008
Bingshan Refrigeration & Heat Ammonia Unified DB21 Not over
sequence 1 9.72 ㎎/L 0.127 tons None
Transfer Technologies Co., Ltd. nitrogen discharged standard
1627-2008
Bingshan Refrigeration & Heat Unified Not over
Dust sequence 1 2.2mg/m3 GB9078-1996 1.363 tons None
Transfer Technologies Co., Ltd. discharged standard
The Company received the new version of the "Sewage Discharge Permit" issued by the Dalian Ecological
Environment Bureau in July 2020. The Company discharges within the limit according to the required emission
concentration of the new version of "Sewage Discharge Permit".
Measures and effects taken by the Company to reduce carbon emissions
During the reporting period, the Company implemented the green, energy-saving and efficient lean production
mode in the production process, continuously improved the operation mode, improved the operation efficiency,
reduced the operation cost, and continued to move forward towards intelligent manufacturing and green
manufacturing.
During the reporting period, the phase I photovoltaic power generation project constructed by the Company using
the roofs of some plants in the new plant area operated smoothly as a whole. The installed power of the project is
3.4 MW, the annual power generation is about 4.08 million kwh, and the annual carbon dioxide emission is
reduced by about 4067 tons.
During the reporting period, based on energy-saving and carbon reduction technologies such as high-efficiency
energy-saving compressors, green refrigerants and CCUS, the Company completed a number of energy-saving
and carbon reduction projects with customers, creating good economic and social benefits.
II．Social responsibilities
During the reporting period, the Company continued to pay attention to the poverty alleviation and consolidation
of its counterpart, Songlin Village, Guangming Mountain Town, Zhuanghe City, visited and regularly maintained
the air conditioning equipment of the villagers' cultural activity center.
16
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 6 Important items
I. Commitments made by the actual controller, shareholders, related parties,
purchasers, the company and other relevant parties that have completed their
performance during the reporting period and have not completed their performance
as of the end of the reporting period
□ Applicable √ Not applicable
II. Non-operation capital occupation by holding shareholders and their related parties
in the listed company
□ Applicable √ Not applicable
III. Foreign guarantee in violation of regulations
□ Applicable √ Not applicable
IV. Engagement and dismissal of the accounting firm
□ Applicable √ Not applicable
V. Explain to the “non standard audit report” of this reporting period from the board
of directors, board of supervisors of the Company
□Applicable √Not applicable
VI. Explain to the “non standard audit report” last year from the board of directors of
the Company
□Applicable √Not applicable
VII. Bankruptcy restructuring related matters
□ Applicable √ Not applicable
VIII. Major lawsuit issues
□ Applicable √ Not applicable
The Company had no major lawsuit issues in the reporting period.
IX. Punishment and rectification
□ Applicable √ Not applicable
X. The credibility of Companies and its controlling shareholder, actual controller
√ Applicable □ Not applicable
The controlling shareholder of the Company and the Company don’t exist situation such as unfulfilled the
court’s effective judgments or failed to pay duly a large amount of debt during the reporting period.
XI. Important associated transactions
1. Important associated transactions
In the reporting period, the total amount of normal associated transactions between the Company and
associated parties was 262,660 thousand yuan, accounting for 34.27% of the budgeted amount for the
year 2022. This included 65,490 thousand yuan, accounting for 37.75% of the budgeted amount for the
year 2022, for purchasing supporting products for package projects from associated parties, and 197,170
thousand yuan, accounting for 33.24% of the budgeted amount for the year 2022, from selling supporting
parts and components to associated parties.
2.Associated transactions related to purchases or sales of assets
□ Applicable √ Not applicable
3.Important associated transactions with joint external investments
□ Applicable √ Not applicable
4.Current associated rights of credit and liabilities
□ Applicable √ Not applicable
5. Current associated rights of credit and liabilities with related financial companies or
financial companies that the company holds
□ Applicable √ Not applicable
6. Other associated transactions
√ Applicable □ Not applicable
During the reporting period, the Company transferred 100% equity of its wholly-owned subsidiary
Bingshan Technology Services (Dalian) Co., Ltd. to Dalian Bingshan Group Co., Ltd., Dalian
Zhonghuida Refrigeration Technology Co., Ltd. and Dalian Zhixin Enterprise Management Partnership
(limited partnership) upon deliberation at the 2nd meeting of the 9th Board of Directors of the Company.
The above transactions constitute connected transactions and the equity transfer has been completed.
17
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
XII．Major contract and its performance
1. Hosting, contracting and leasing status
(1) the hosting status
□ Applicable √ Not applicable
(2) the contracting status
□ Applicable √ Not applicable
(3) the leasing status
√ Applicable □ Not applicable
The Company signed rental contract with MHI Bingshan Refrigeration (Dalian) Co., Ltd., and rent # 6
workshop building located on No. 106 Liaohe East Rd, Dalian Economic and Technology Development
Zone to MHI Bingshan Refrigeration (Dalian) Co., Ltd. The rental area is 15,259.04 square meters, and
the rental term till 16th July, 2029. The annual rent fee for 2022 is RMB 4 million Yuan.
The Company signed rental contract with Dalian Bingshan Wisdom Park Co., Ltd., and rent out the
whole land and house of the Company’s old plant locating at No. 888, Southwest Road, Shahekou
District, Dalian to Dalian Bingshan Wisdom Park Co., Ltd., with rental land area of 167,165.61 square
meters and housing area of 105,652.43 square meters. The lease term is from April 1, 2017 to December
31, 2036. The annual rent fee for 2022 is RMB 8.646 million Yuan.
On March 17, 2021, the Company signed a lease contract with Linde Hydrogenation Station Equipment
(Dalian) Co., LTD., which will lease the 8,700 square meters of plant and office located at No. 106, East
Liaohe Road, Dalian Development Zone to Linde Hydrogenation Station Equipment (Dalian) Co., LTD.
The lease term will be up to December 31, 2030, and the current rent is RMB 2,137,500.
2. Guaranteeing status
√ Applicable □ Not applicable
Resolution of 2nd meeting of 7th session of the Board of directors agreed to provide guarantee to Dalian
Bingshan Group Co., Ltd. for obtaining Development Fund of National Development Bank. Total amount
of the loan was RMB160 million with interest rate 1.2%, and the loan period was 10 years. The fund can
only be used for cold chain green intelligent equipment and the development of service industry. When
Dalian Bingshan Group Co., Ltd. receives the fund, it has transferred all the fund to the Company with
the same conditions. The above guarantee to Dalian Bingshan Group Co., Ltd. is to the Company itself
actually.
The guarantee provided by the Company to the customer Guizhou Waterfall Cold Chain Food Investment
Co., Ltd. based on the financial leasing business continued to the reporting period, with a guarantee
amount of 25.705 million yuan. The project is currently under normal performance. The shareholders of
the guaranteed party and relevant natural persons have provided the Company with full joint and several
liability guarantee counter guarantee, and the Company's guarantee risk is generally controllable.
The guarantee provided by the Company to the customer Liuyang Zhongjie Technology Investment Co.,
Ltd. based on the financial leasing business continued to the reporting period, with a guarantee amount of
9.831 million yuan. The project is currently under normal performance. The shareholders of the
guaranteed party and relevant natural persons have provided the Company with full joint and several
liability guarantee counter guarantee, and the Company's guarantee risk is generally controllable.
The above guarantee matters have been reviewed and disclosed by the board of directors.
3.Entrusted Financial Management
□ Applicable √ Not applicable
4. Major contract of daily operation
□ Applicable √ Not applicable
5. Other important contracts
□Applicable √Not applicable
XIII. Description of other important matters
□Applicable √Not applicable
XV. Major matters of the company's subsidiaries
□Applicable √Not applicable
18
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 7 Change in Share Capital and Shareholders'
Information
I. Change in share capital
1. Change in share capital
Shares Shares
（before change） （after change）
items Changes
number proportion number proportion
I. Non-circulating share capital with restricted
3,130,039 0.37% +387,789 3,517,828 0.42%
trade conditions
Other domestic shares 3,130,039 0.37% +387,789 3,517,828 0.42%
II. Circulating share capital 840,082,468 99.63% -387,789 839,694,679 99.58%
1. Domestically listed ordinary shares 598,582,468 70.99% -387,789 598,194,679 70.94%
2. Domestically listed foreign shares 241,500,000 28.64% 0 241,500,000 28.64%
III. Total shares 843,212,507 100% 0 843,212,507 100%
The reason for the Change in share capital
During the report period, the Company's new director Fan Wen, deputy general manager Lu Jun, the
Company's director Ding Jie, Xu Junrao expired term of office. The above changes in personnel lead to
changes in senior executives' locked-in shares, resulting in changes in share composition.The above
reasons cause changes in the composition of shares.
Approval of changes in shares
□ Applicable √ Not applicable
The influence of change in share capital on the recent year and recent issue for basic earnings per
share ,diluted earnings per share and net assets per share.
□ Applicable √ Not applicable
2. The restricted shares changes
√Applicable □ Not applicable
The beginning number of the restricted shares is 3,130,039, and the final number of the restricted shares
is 3,517,828, with an increase of 387,789.
II. Securities issuance and listing
1. Securities issuance in the report period
□ Applicable √ Not applicable
III. Shareholders and actual controller
1. Number of shareholders and their shareholding
Total number of shareholders at the end of the Total number of shareholders as of the last month
82,519 --
reporting period before disclosure of the annual report
Shareholding of top ten shareholders
Number of
Number of
pledged
shares
Name Nature Proportion Total number shares or
with sale
shares
restriction
frozen
Domestic non-state-owned
Dalian Bingshan Group Co., Ltd. 20.27% 170,916,934
legal person
Sanyo Electric Co., Ltd. Overseas legal person 8.72% 73,503,150
Lin Zhenming Foreign natural person 0.80% 6,730,000
Chen Yong Domestic natural person 0.54% 4,520,000
Wu An Domestic natural person 0.53% 4,500,000
Zhang Sufen Domestic natural person 0.51% 4,300,000
Xue Hong Domestic natural person 0.43% 3,600,000
Dalian industrial development investment Domestic non-state-owned
0.40% 3,406,725
Co., Ltd. legal person
Li Xiaohua Domestic natural person 0.37% 3,145,608
19
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Zhan Changcheng Domestic natural person 0.36% 3,013,927
Shareholding of top ten shareholders without sale restriction
Number of shares without
Name Type of shares
sale restriction
Dalian Bingshan Group Co., Ltd. 170,916,934 RMB denominated ordinary shares
Sanyo Electric Co., Ltd. 73,503,150 Domestically listed foreign shares
Lin Zhenming 6,730,000 Domestically listed foreign shares
Chen Yong 4,520,000 RMB denominated ordinary shares
Wu An 4,500,000 Domestically listed foreign shares
Zhang Sufen 4,300,000 RMB denominated ordinary shares
Xue Hong 3,600,000 Domestically listed foreign shares
Dalian industrial development investment Co., Ltd. 3,406,725 RMB denominated ordinary shares
Li Xiaohua 3,145,608 RMB denominated ordinary shares
Zhan Changcheng 3,013,927 Domestically listed foreign shares
Dalian Bingshan Group Co., Ltd. had the association relationship
Notes to the associated relationship and uniform actions of the with Sanyo Electric Co., Ltd. among the above shareholders.
above shareholders Sanyo Electric Co., Ltd. holds 26.6% of Dalian Bingshan Group
Co., Ltd.'s equity.
At the end of the reporting period, the total number of shareholders of the Company was 82,519,
including 75,178 A-share shareholders and 7,341 B-share shareholders.
If the Company shareholders had any agreed repurchase transaction in the report period
□ Yes √ No
IV. Changes in shareholding of directors, supervisors and senior managers
□ Applicable √ Not applicable
V. Variation in controlling shareholders or actual controllers
Variation in controlling shareholders in the report period
□ Applicable √ Not applicable
There were no changes in the controlling shareholder in the reporting period.
Variation in actual controllers in the report period
□ Applicable √ Not applicable
20
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 8 Information on Preferred Stock
□ Applicable √ Not applicable
In the reporting period, the Company didn’t own preferred stock.
21
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 9 Bond Related Information
□ Applicable √ Not applicable
In the reporting period, the Company didn’t own Bond.
22
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Section 10 Financial Report
I. The Company's semiannual financial report has not been audited.
23
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
BALANCE SHEET
Prepared by Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. June 30, 2022 Unit: RMB Yuan
30-June-2022 1-Jan-2022
Items
Consolidation Parent Company Consolidation Parent Company
Current assets:
Monetary funds 402,662,001.86 226,098,769.14 522,658,505.79 391,077,589.19
Financial assets which are measured by fair value and
which changes are recorded in current profit and loss
Derivative financial assets
Transaction financial assets
Notes receivable 181,955,093.07 54,171,528.95 166,430,365.74 61,036,803.62
Accounts receivable 982,008,651.89 640,566,516.75 821,548,678.85 408,719,275.78
Receivables financing 24,737,543.92 764,581.61 43,704,310.38 5,427,828.26
Accounts paid in advance 225,537,271.29 90,322,298.26 182,701,403.55 57,409,521.75
Other receivables 182,939,942.92 154,188,541.18 60,340,096.45 54,222,825.18
Interest receivables
Dividend receivable 12,864,770.89 16,321,464.90 1,003,568.75 25,100,920.84
Inventories 1,053,998,091.18 340,277,702.25 1,014,527,127.82 339,977,048.51
Contract assets 126,164,442.94 74,697,908.71 109,859,658.79 50,916,025.04
Assets held for sale
Non-current asset due within one year 14,990,989.30 13,281,553.63 14,990,989.30 13,281,553.63
Other current assets 17,677,299.20 262,875.32 24,525,076.71 8,871,387.69
Total current assets 3,212,671,327.57 1,594,632,275.80 2,961,286,213.38 1,390,939,858.65
Non-current assets:
Finance asset held available for sales
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 1,207,390,848.39 1,877,227,706.53 1,231,504,533.45 1,923,394,225.05
Other Non-current financial assets 167,515,974.19 166,200,831.69 261,410,664.61 260,095,522.11
Investment property 117,379,096.16 93,418,471.21 120,752,809.61 95,850,052.41
Fixed assets 831,680,902.75 654,070,032.03 855,395,405.85 680,392,162.13
Construction in progress 50,556,431.55 42,169,867.00 38,974,478.45 28,279,901.38
Right of use assets 16,107,591.26 14,980,609.23 23,934,703.37 15,636,361.47
Engineering material
Disposal of fixed asset
Productive biological asset
Oil and gas asset
Intangible assets 138,604,066.93 71,688,794.33 142,592,738.10 73,679,019.01
Expense on Research and Development
Goodwill 1,750,799.49 - 1,750,799.49 -
Long-term expenses to be apportioned 7,465,632.83 6,113,409.69 8,088,684.23 6,766,442.52
Deferred income tax asset 90,178,832.03 16,863,056.76 89,879,574.13 16,806,287.61
Other non-current asset
Total non-current asset 2,628,630,175.58 2,942,732,778.47 2,774,284,391.29 3,100,899,973.69
Total assets 5,841,301,503.15 4,537,365,054.27 5,735,570,604.67 4,491,839,832.34
Current liabilities:
24
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Short-term loans 240,000,000.00 229,000,000.00 245,937,091.72 230,373,666.72
Financial liabilities which are measured by fair value
and which changes are recorded in current profit and
loss
Derivative financial liabilities
Transaction financial liabilities
Notes payable 320,677,585.76 206,656,813.15 380,033,039.56 238,051,362.81
Accounts payable 1,157,541,083.28 373,435,894.60 919,871,927.53 318,798,749.33
Accounts received in advance
Contract liabilities 445,660,584.96 130,257,394.65 499,719,963.40 115,654,933.60
Wage payable 9,106,878.51 133,117.58 35,148,782.48 13,551,313.90
Taxes payable 32,022,968.12 17,912,457.32 13,514,847.82 2,667,309.95
Other accounts payable 47,679,599.23 26,296,775.31 55,284,140.21 23,508,139.39
Interest payable
Dividend payable 10,765,281.07 8,965,281.07 3,008,156.00 533,156.00
Liabilities held for sale
Non-current liabilities due within one year 22,899,439.44 1,918,874.53 24,175,388.12 1,918,874.53
Other current liabilities 201,328,280.32 70,763,171.64 195,213,206.91 68,871,944.99
Total current liabilities 2,476,916,419.62 1,056,374,498.78 2,368,898,387.75 1,013,396,295.22
Non-current liabilities:
Long-term loans 140,000,000.00 140,000,000.00 150,000,000.00 150,000,000.00
Bonds payable
Preferred stock
Perpetual bond
Lease liability 5,631,101.48 12,121,374.01 5,394,021.14 13,243,055.41
Long-term account payable 23,088,337.61 - 19,998,913.29 -
Long-term wage payable
Special Payable
Anticipation liabilities
Deferred income 103,009,836.92 64,389,334.92 106,185,323.82 66,992,823.82
Deferred income tax liabilities 23,238,317.04 23,238,317.04 35,596,349.70 35,596,349.70
Other non-current liabilities
Total non-current liabilities 294,967,593.05 239,749,025.97 317,174,607.95 265,832,228.93
Total liabilities 2,771,884,012.67 1,296,123,524.75 2,686,072,995.70 1,279,228,524.15
Shareholders’ equity
Share capital 843,212,507.00 843,212,507.00 843,212,507.00 843,212,507.00
Other equity instruments
Preferred stock
Perpetual bond
Capital public reserve 719,879,694.78 755,146,592.54 720,215,866.78 755,146,592.54
Less: Treasury stock
Other comprehensive income 2,178,681.73 1,216,581.06 2,178,681.73 1,216,581.06
Special preparation
Surplus public reserve 809,471,199.64 809,471,199.64 809,471,199.64 809,471,199.64
Generic risk reserve
Retained profit 648,900,808.77 832,194,649.28 627,764,582.32 803,564,427.95
Total owner’s equity attributable to parent company 3,023,642,891.92 3,241,241,529.52 3,002,842,837.47 3,212,611,308.19
Minority interests 45,774,598.56 - 46,654,771.50 -
25
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Total owner’s equity 3,069,417,490.48 3,241,241,529.52 3,049,497,608.97 3,212,611,308.19
Total liabilities and shareholder’s equity 5,841,301,503.15 4,537,365,054.27 5,735,570,604.67 4,491,839,832.34
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
26
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
INCOME STATEMENT
Prepared by Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. January-June, 2022 Unit: RMB Yuan
January-June, 2022 January-June, 2021
Items
Consolidation Parent Company Consolidation Parent Company
I. Total sales 1,291,858,908.71 468,001,628.25 1,094,285,620.97 406,481,436.30
II. Total operating cost 1,304,025,021.32 486,496,189.37 1,125,502,134.17 430,343,974.93
Including: Operating cost 1,131,915,209.09 407,577,362.51 950,404,769.26 350,403,193.45
Taxes and associate charges 9,791,372.03 5,558,409.19 9,681,522.15 6,384,124.77
Selling and distribution expenses 55,209,408.15 20,533,128.73 56,710,524.65 21,863,336.01
Administrative expenses 70,074,155.71 34,892,044.21 71,726,497.78 33,484,241.78
R&D expenses 31,564,520.91 14,040,048.85 30,738,151.60 13,801,193.69
Financial expense 5,470,355.43 3,863,954.55 6,240,668.73 4,407,885.23
Including: interest expense 7,533,477.17 4,561,734.35 8,685,937.28 6,705,229.51
interest income 2,004,850.77 1,542,821.77 3,144,366.44 3,042,414.46
Add: Other income 1,984,170.62 31,241.33 914,454.99 -
Gain/(loss) from investment 83,743,763.15 88,227,124.82 28,211,757.61 29,386,783.07
Including: income from investment on
16,955,402.09 16,926,568.63 21,085,751.39 22,157,178.59
affiliated enterprise and jointly enterprise
Gain/(loss) from change in fair value (loss as “-“) -29,425,921.52 -29,425,921.52 -5,034,903.12 -5,034,903.12
Credit impairment loss (loss as “-“) -12,091,879.71 -1,460,424.20 -7,635,425.72 -2,126,150.18
Assets impairment loss (loss as “-“) -775,665.61 -632,818.79 -1,016,603.72 -403,392.99
Gain/(loss) from asset disposal (loss as “-“) 67,260.20 1,451.76 8,393.93 -399.28
III. Operating profit 31,335,614.52 38,277,333.61 -15,768,839.23 -2,040,601.13
Add: non-business income 1,610,684.35 20,000.08 1,939,098.38 48.54
Less: non-business expense 332,644.57 561,689.05 373,198.48
IV. Total profit 32,613,654.30 38,297,333.69 -14,391,429.90 -2,413,751.07
Less: Income tax 2,774,153.99 1,234,987.29 2,514,997.49 -1,043,300.45
V. Net profit 29,839,500.31 37,062,346.40 -16,906,427.39 -1,370,450.62
(I) Net profit from continuous operation 29,839,500.31 37,062,346.40 -16,906,427.39 -1,370,450.62
(II)Net profit from discontinuing operation
Net profit attributable to parent company 29,568,351.52 37,062,346.40 -14,584,210.01 -1,370,450.62
Minority shareholders’ gains and losses 271,148.79 -2,322,217.38 -
VI. After-tax net amount of other comprehensive
incomes
After-tax net amount of other comprehensive incomes
attributable to owners of the Company
(I) Other comprehensive incomes that will not be
reclassified into gains and losses
1. Changes in net liabilities or assets with a defined
benefit plan upon re-measurement
2. Enjoyable shares in other comprehensive incomes in
invests that cannot be reclassified into gains and losses
under the equity method
(II) Other comprehensive incomes that will be
reclassified into gains and losses
1. Enjoyable shares in other comprehensive incomes in
invests that will be reclassified into gains and losses
under the equity method
2. Gains and losses on fair value changes of
available-for-sale financial assets
3. Gains and losses on reclassifying held-to-maturity
27
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
investments into available-for-sale financial assets
4. Effective hedging gains and losses on cash flows
5. Foreign-currency financial statement translation
difference
6、Others
……
After-tax net amount of other comprehensive incomes
attributable to minority shareholders
VII Total comprehensive income 29,839,500.31 37,062,346.40 -16,906,427.39 -1,370,450.62
Total comprehensive income attributable to parent
company 29,568,351.52 37,062,346.40 -14,584,210.01 -1,370,450.62
Total comprehensive income attributable to minority
shareholders 271,148.79 -2,322,217.38 -
VIII. Earnings per share
(I) basic earnings per share 0.035 -0.017 -
(II) diluted earnings per share 0.035 -0.017 -
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
28
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
CASH FLOW STATEMENT
Prepared by Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. January -June, 2022 Unit: RMB Yuan
January -June, 2022 January -June, 2021
Items
Consolidation Parent Company Consolidation Parent Company
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing
labor services 1,261,666,720.62 352,345,258.81 829,930,587.89 363,144,362.91
Write-back of tax received 11,560,593.20 4,006,659.69 13,785,959.06 -
Other cash received concerning operating activities 27,127,455.59 5,384,314.18 43,810,533.99 10,124,431.16
Subtotal of cash inflow arising from operating activities 1,300,354,769.41 361,736,232.68 887,527,080.94 373,268,794.07
Cash paid for purchasing commodities and receiving
labor service 1,193,219,986.59 496,371,451.85 611,357,308.87 250,713,151.99
Cash paid to/for staff and workers 188,402,543.12 62,633,591.91 180,167,491.49 57,127,778.83
Taxes paid 31,106,515.38 11,139,042.04 39,272,409.35 21,117,335.18
Other cash paid concerning operating activities 77,032,061.17 32,464,131.37 85,617,707.51 24,604,890.78
Subtotal of cash outflow arising from operating activities 1,489,761,106.26 602,608,217.17 916,414,917.22 353,563,156.78
Net cash flows arising from operating activities -189,406,336.85 -240,871,984.49 -28,887,836.28 19,705,637.29
II. Cash flows arising from investing activities:
Cash received from recovering investment 300,000.00 300,000.00 3,262.34
Cash received from investment income 76,499,887.00 76,474,242.00 40,106,533.49 40,106,533.49
Net cash received from disposal of fixed, intangible and
other long-term assets 361,191.28 5,000.00 79,228.00 5,000.00
Net cash received from disposal of subsidiaries and other
units 5,605,792.62 25,888,200.00 36,263,700.00 36,263,700.00
Other cash received concerning investing activities
Subtotal of cash inflow from investing activities 82,766,870.90 102,667,442.00 76,452,723.83 76,375,233.49
Cash paid for purchasing fixed, intangible and other
long-term assets 12,416,614.10 9,320,136.74 4,948,265.12 3,291,284.99
Cash paid for investment 45,400,000.00 45,400,000.00
Net cash paid for achievement of subsidiaries and other
business units
Other cash paid concerning investing activities
Subtotal of cash outflow from investing activities 12,416,614.10 9,320,136.74 50,348,265.12 48,691,284.99
Net cash flows arising from investing activities 70,350,256.80 93,347,305.26 26,104,458.71 27,683,948.50
III. Cash flows arising from financing activities
Cash received from absorbing investment
Including: Cash received from absorbing minority
shareholders' equity investment by subsidiaries
Cash received from loans 240,850,000.00 229,000,000.00 235,180,000.00 207,000,000.00
Cash received from issuing bonds
Other cash received concerning financing activities 95,778,131.09 21,144,709.02 60,343,934.67 23,123,472.43
Subtotal of cash inflow from financing activities 336,628,131.09 250,144,709.02 295,523,934.67 230,123,472.43
Cash paid for settling debts 237,845,000.00 237,845,000.00 284,622,721.99 266,011,600.00
Cash paid for dividend and profit distributing or interest
12,340,724.16 8,186,734.35 8,511,930.03 7,062,645.82
paying
Including: dividends or profit paid by subsidiaries to
minority shareholders
Other cash paid concerning financing activities 56,257,183.04 612,000.00 60,312,645.22 22,103,989.52
Subtotal of cash outflow from financing activities 306,442,907.20 246,643,734.35 353,447,297.24 295,178,235.34
Net cash flows arising from financing activities 30,185,223.89 3,500,974.67 -57,923,362.57 -65,054,762.91
IV. Influence on cash due to fluctuation in exchange rate 1,614,217.38 -15.49 116,967.67 -448.17
29
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
V. Net increase of cash and cash equivalents -87,256,638.78 -144,023,720.05 -60,589,772.47 -17,665,625.29
Add: Balance of cash and cash equivalents at the period
-begin 438,969,337.87 369,932,989.19 314,978,460.49 185,202,268.28
VI. Balance of cash and cash equivalents at the
period–end 351,712,699.09 225,909,269.14 254,388,688.02 167,536,642.99
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
30
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
CONSOLIDATED STATEMENT OF CHANGES IN OWNERS’ EQUITY
Prepared by Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd 2022.01-06 Unit: RMB Yuan
2022.01-06
Owners’ equity attributable to parent company
Items Lessen: Other Special Retained Minority Total of
Capital Surplus equity owners’ equity
share capital treasury comprehens preparatio profits
suplus reserve
stock ive income n
I. balance at the end of last
843,212,507.00 720,215,866.78 2,178,681.73 809,471,199.64 627,764,582.32 46,654,771.50 3,049,497,608.97
year
1. Change of accounting
policy
2. Correction of errors in
previous period
II. Balance at the beginning of
843,212,507.00 720,215,866.78 2,178,681.73 809,471,199.64 627,764,582.32 46,654,771.50 3,049,497,608.97
this year
III. Increase/ decrease of
amount in this year (“-” 336,172.00 21,136,226.45 -880,172.94 19,919,881.51
means decrease)
(I) Total comprehensive
29,568,351.52 271,148.79 29,839,500.31
incomes
(II) Capital increased and
648,678.27 648,678.27
reduced by owners
1. Common shares increased
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other 648,678.27 648,678.27
(III) Profit distribution -8,432,125.07 -1,800,000.00 -10,232,125.07
1. Withdrawing surplus
public reserve
2. Distribution to all owners
-8,432,125.07 -1,800,000.00 -10,232,125.07
(shareholders)
3. Others
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period
2. Used in the period
(VI) Other -336,172.00 -336,172.00
IV. Balance at the end of this
843,212,507.00 719,879,694.78 2,178,681.73 809,471,199.64 648,900,808.77 45,774,598.56 3,069,417,490.48
period
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
31
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
2021.01-06
Owners’ equity attributable to parent company
Items Total of
Lessen: Other Special Retained Minority
Capital Surplus owners’
share capital treasury comprehens preparatio profits equity
suplus reserve equity
stock ive income n
I. balance at the end of last
843,212,507.00 726,768,468.00 2,501,459.77 805,525,775.33 997,601,577.97 73,596,499.65 3,449,206,287.72
year
1. Change of accounting
policy
2. Correction of errors in
previous period
II. Balance at the beginning of
843,212,507.00 726,768,468.00 2,501,459.77 805,525,775.33 997,601,577.97 73,596,499.65 3,449,206,287.72
this year
III. Increase/ decrease of
amount in this year (“-” -16,123,970.29 12,785,383.91 -35,801,718.99 -2,322,217.38 -41,462,522.75
means decrease)
(I) Total comprehensive
-14,584,210.01 -2,322,217.38 -16,906,427.39
incomes
(II) Capital increased and
reduced by owners
1. Common shares increased
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other
(III) Profit distribution 12,785,383.91 -21,217,508.98 - -8,432,125.07
1. Withdrawing surplus
12,785,383.91 -12,785,383.91 -
public reserve
2. Distribution to all owners
-8,432,125.07 -8,432,125.07
(shareholders)
3. Others
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period 1,201,021.67 1,201,021.67
2. Used in the period -1,201,021.67 -1,201,021.67
(VI) Other -16,123,970.29 -16,123,970.29
IV. Balance at the end of this
843,212,507.00 710,644,497.71 2,501,459.77 818,311,159.24 961,799,858.98 71,274,282.27 3,407,743,764.97
period
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
32
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
STATEMENT OF CHANGES IN OWNERS’ EQUITY
Prepared by Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd 2022.01-06 Unit: RMB Yuan
2022.01-06
Owners’ equity attributable to parent company
Items Other Lessen: Other Total of owners’
Capital Special Surplus equity
share capital equity treasury comprehensive Retained profits
suplus preparation reserve
instrument stock income
I. balance at the end of last
843,212,507.00 755,146,592.54 1,216,581.06 809,471,199.64 803,564,427.95 3,212,611,308.19
year
1. Change of accounting
policy
2. Correction of errors in
previous period
II. Balance at the beginning of
843,212,507.00 755,146,592.54 1,216,581.06 809,471,199.64 803,564,427.95 3,212,611,308.19
this year
III. Increase/ decrease of
amount in this year (“-” 28,630,221.33 28,630,221.33
means decrease)
(I) Total comprehensive
37,062,346.40 37,062,346.40
incomes
(II) Capital increased and
reduced by owners
1. Common shares increased
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other
(III) Profit distribution -8,432,125.07 -8,432,125.07
1. Withdrawing surplus
public reserve
2. Distribution to all owners
-8,432,125.07 -8,432,125.07
(shareholders)
3. Others
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period 641,750.97 641,750.97
2. Used in the period -641,750.97 -641,750.97
(VI) Other
IV. Balance at the end of this
843,212,507.00 755,146,592.54 1,216,581.060 809,471,199.64 832,194,649.28 3,241,241,529.52
period
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
33
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
2021.01-06
Owners’ equity attributable to parent company
Items Other Lessen: Other Total of owners’
Capital Special Surplus Retained equity
share capital equity treasury comprehensive
suplus preparation reserve profits
instrument stock income
I. balance at the end of last
843,212,507.00 771,270,562.83 1,539,359.10 805,525,775.33 990,593,941.49 3,412,142,145.75
year
1. Change of accounting
policy
2. Correction of errors in
previous period
II. Balance at the beginning of
843,212,507.00 771,270,562.83 1,539,359.10 805,525,775.33 990,593,941.49 3,412,142,145.75
this year
III. Increase/ decrease of
amount in this year (“-” -16,123,970.29 12,785,383.91 -22,587,959.60 -25,926,545.98
means decrease)
(I) Total comprehensive
-1,370,450.62 -1,370,450.62
incomes
(II) Capital increased and
reduced by owners
1. Common shares increased
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other
(III) Profit distribution 12,785,383.91 -21,217,508.98 -8,432,125.07
1. Withdrawing surplus
12,785,383.91 -12,785,383.91 -
public reserve
2. Distribution to all owners
-8,432,125.07 -8,432,125.07
(shareholders)
3. Others
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period 1,201,021.67 1,201,021.67
2. Used in the period -1,201,021.67 -1,201,021.67
(VI) Other -16,123,970.29 -16,123,970.29
IV. Balance at the end of this
843,212,507.00 755,146,592.54 1,539,359.10 818,311,159.24 968,005,981.89 3,386,215,599.77
period
Legal Representative: Ji Zhijian Chief Financial Official: Wang Jinxiu Person in Charge of Accounting Organization: Li Sheng
34
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
II. Accounting statement
III. General Information
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd (the “Company”) was reorganized
and reformed from main part of former Dalian Refrigeration Factory. On December 8, 1993, the
Company went to the public as a listed Company at Shenzhen Stock Exchange Market. On
March 20, 1998, the company successfully went to the public at B share market and listed at
Shenzhen Stock Exchange Market with total share capital of RMB350,014,975Yuan.
According to the 13th meeting of the 6th generation of board, extraordinary general meeting for
2015 fiscal year and ' Restricted share incentive plan (draft)' , the Company planned to introduce
A ordinary shares to incentive objectives, which was 10,150,000 number of shares would be
granted to 41 share incentive objectives at granted price of RMB5.56Yuan per share. Up to March
12th ,2015, the Company received new added share capital of RMB10,150,000Yuan and the share
capital had been verified by DaHua Certified Public Accountants, and had been issued the capital
verification report Dahuayanzi [2015]000086 on March12th , 2015.
The general meeting for 2015 fiscal year held on 21st April 2016 approved the profit distribution
policy for the year of 2015, which agrees the profit distribution based on the total 360,164,975
number of shares as share capital, paid share dividend of 5 common shares for every 10 shares
through capital reserve. The policy stated above was fully implemented on 5th May 2016, and the
registered capital was altered to 540,247,462.00Yuan.
The 17thmeeting of the 6th generation of board was held on 4th June 2015 and the 2nd interim
shareholders’ meeting was held on 24th June 2015, meeting deliberated and passed the proposal
of non-public offering of ‘A shares’. China’s Securities Regulatory Commission issued SFC
license [2015]3137 on 30th December, 2015, approving that new non-public offering cannot
exceeded 38,821,954 number of shares. The company implemented the post meeting procedures
for China’s Securities Regulatory Commission, which is regarding adjustment of bottom price and
the number of the shares issued after the implementation of profit distribution policy of 2015 in
May, 2016, and accordingly revised the upper limit of non-public offering of share to58,645,096
number of new ‘A shares’. The company issued the non-public offering of 58,645,096 number of
‘A shares’ to 7 investors, and as a result, the total number of shares of the company is changed to
598,892,558 shares, and the par value is 1yuan per share and the total share capital is
598,892,558.00Yuan. The share capital stated above has been verified by DaHua Certified Public
Accountants, and has been issued the capital verification report Dahuayanzi [2016]000457 on 31st
May 2016.
According to the ‘Restricted Share Incentive Plan(draft) of Dalian Refrigeration Company
Limited for the year of 2016’ and the ‘Proposal regarding the shareholders’ meeting authorized the
board of directors to implement the Restricted Share Incentive Plan’ approved on the
3rdprovisional general meeting held on 13th September 2016, the 9th meeting of the 7th generation
of board deliberated and passed the ‘Proposal about granting the restricted shares to incentive
targets’ on September 20th, 2016 and set 20th September 2016 as share granted date, and granted
35
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
12,884,000 number of restricted shares to 188 incentive targets at granted price of 5.62Yuan per
share. By 22ndNovember, 2016, the company has actually received the newly subscribed
registered share capital of 12,884,000Yuan subscribed by incentive targets. The share capital
stated above has been verified by DaHua Certified Public Accountants, and has been issued the
capital verification report Dahuayanzi [2016]001138 on 23rdNovember, 2016.
On May 20th, 2017, the general meeting for 2016 fiscal year was held and profit appropriation
scheme for 2016 FY was approved, which was every 10 shares will be increased by 4 shares
through capital reserve based on the total 611,776,558 number of shares. After the profit
appropriation scheme, the registered capital was changed to RMB856,478,181.00Yuan.
On December 18, 2017, the Company held the third extraordinary shareholders’ meeting of 2017
which reviewed and approved the Proposal on Repurchasing and Cancelling Part Restricted
Stocks of the 2016 Restricted Stock Incentive Plan”. On March 8, 2018, after the completion of
repurchase and cancellation, the Company implemented the corresponding capital reduction
procedures according to law, and the registered capital of the Company was changed from
856,487,181 Yuan to 855,908,981 Yuan.
On May 4, 2018, the Company held the 21st meeting of the seventh board of directors which
reviewed and approved the Proposal on Repurchasing and Cancelling Party Restricted Stocks of
the 2015 Restricted Stock Incentive Plan. On June 29, 2018, after the completion of repurchase
and cancellation, the Company implemented the corresponding capital reduction procedures
according to law, and the registered capital of the Company was changed from 855,908,981 Yuan
to 855,434,087 Yuan.
On January 17,2019, the Company held the first extraordinary shareholders’ meeting of 2019
which reviewed and approved the Proposal on terminating the implementation of 2016 Restricted
Stock Incentive Plan of the Company and logouting the restricted stock. On March 4,2019, the
Company has completed the capital reduction process, and the registered capital of the Company
was changed from 855,434,087 Yuan to 843,212,507 Yuan.
On December 20th, 2019, the Company held the 7th meeting of the 8th Board of Directors and
approved to change the Company’s name from Dalian Refrigeration Company Limited to
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd.
The old address of the Company’s registered office as same as head office is No.888 Xinan Road,
Shahekou District, Dalian, China. In 2017, the Company relocated to new factory and changed its
address to No.16 Liaohe East RD, Dalian Economic&Technology Development Zone(‘DDZ’),
Dalian China as same as HQ’s address. The parent company of the Company is Dalian Bingshan
Group Co., Ltd., and there is no ultimate controller regulated by the relevant law, regulations and
rules.
The Company is in industrial manufacturing sector, mainly engaged in industrial refrigeration,
refrigerated and frozen food storage, and manufacture and installation of central air-conditioning
and refrigeration equipment. The scope of business includes research and development, design,
36
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
manufacture, sale, lease, installation and repair of refrigeration and heat equipment, accessories,
spare parts, and energy-saving and environmental protection products; Technical services,
technical consultation, technical promotion; Design, construction, installation repair and
maintenance of complete sets of refrigeration and air conditioning projects, mechanical and
electrical installation projects, steel structure projects, anti-corrosion and heat preservation works;
Rental of premises; Transport of ordinary goods; Property management; Low temperature storage;
Import and export of goods and technologies. (With the exception of projects subject to approval
according to law, independently carry out business activities according to law with the business
license).
During this reporting period, entities within the consolidation scope has change comparing to last
year, decreasing 2 entities (Bingshan Technology Services (Dalian) Co., Ltd. and Ningbo
Bingshan Refrigeration and Air Conditioning Engineering Co., Ltd.).
IV. Financial Statements Preparation Basis
（1） Preparing basis
The Company’s financial statements are prepared on the basis of going concern assumption,
according to the actual occurred transactions and events and in accordance with ‘Accounting
Standards for Business Enterprises’ and relevant regulations, and also based on the note V
“Significant Accounting Policies, Accounting Estimates”.
（2） Going concern
The Company has the capacity to continually operate within 12 months at least since the end of
report period, and hasn‘t the major issues impacting on the sustainable operation ability.
V. Significant Accounting Policies and Accounting Estimates
1. Declaration for compliance with accounting standards for business enterprises
The financial statements are prepared by the Group according to the requirements of Accounting
Standard for Business Enterprise, and reflect the relative information for the financial position,
operating performance, cash flow of the Group truly and fully.
2. Accounting period
The Group adopts the Gregorian calendar year as accounting period from Jan 1 to Dec 31.
3. Operating cycle
Normal operating cycle refers to the duration starting from purchasing the assets for
manufacturing up to cash or cash equivalent realization. The group sets twelve months for one
operating cycle and as the liquidity criterion for assets and liability.
4. Functional currency
The Group adopts RMB as functional currency.
5. Accounting for business combination under same control and not under same control
37
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
As an acquirer, the assets and liabilities that The Group obtained in a business combination under
the same control should be measured on the basis of their carrying amount in the consolidated
financial statements on the combining date. As for the balance between the carrying amount of the
net assets obtained by the combining party and the carrying amount of the consideration paid by it,
the capital surplus shall be adjusted. If the capital surplus is not sufficient to be offset, the retained
earnings shall be adjusted.
For a business combination not under same control, the asset, liability and contingent liability
obtained from the acquirer shall be measured at the fair value on the acquisition date. The
combination cost shall be the fair value, on the acquisition date, of the assets paid, the liabilities
incurred or assumed and equity securities issued by the acquirer in exchange for the control of the
acquire, and sum of all direct expenses(if the combination is achieved in stages, the combination
cost shall be the sum of individual transaction). The difference when combination cost exceeds
proportionate share of the fair value of identifiable net assets of acquire should be recognized as
goodwill. If the combination cost is less than proportionate share of the fair value of identifiable
net assets of acquiree, firstly, fair value of identifiable asset, liability or contingent liability shall
be reviewed, and so the fair value of non-monetary assets or equity instruments issued in the
combination consideration , after review, still the combination cost is less than proportionate
share of the fair value of identifiable net assets of acquire, the difference should be recognized as
non-operating income.
6. Method of preparation of consolidated financial statements
All subsidiaries controlled by the Group and structured entities are within the consolidation scope.
If subsidiaries adopt different accounting policy or have different accounting period from the
parent company, appropriated adjustments shall be made in accordance with the Group policy in
preparation of the consolidated financial statements.
All significant intergroup transactions, outstanding balances and unrealized profit shall be
eliminated in full when preparing the consolidated financial statements. Portion of the subsidiary’s
equity not belonging to the parent, profit, loss for the current period, portion of other
comprehensive income and total comprehensive belonging to minority interest, shall be
presented separately in the consolidated financial statements under “minority interest of
equity”, ”minority interest of profit and loss”, “other comprehensive income attributed to minority
interest” and “total comprehensive income attributed to minority interest” title.
If a subsidiary is acquired under common control, its operation results and cash flow shall be
consolidated since the beginning of the consolidation period. When preparing the comparative
consolidated financial statements, adjustments shall be made to relevant items of comparative
figures as regarded that reporting entity established through consolidation has been always there
since the point when the ultimate controlling party starts to have the control.
If a business consolidation under common control is finally achieved in stages, consolidation
accounting method shall be disclosed additionally for the period in which the control is obtained.
38
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
For example, if a business consolidation under common control is finally achieved in stages, when
preparing the consolidated financial statements, adjustments shall be made for the current
consolidation status as if consolidation has always been there since the point when the ultimate
controlling party starts to control. In preparation of comparative figures, asset and liability of the
acquiree shall be consolidated into the Group’s comparative financial statements, but to the extent
no earlier than the point when the Group and acquiree are both under ultimate control and relevant
items under equity in comparative financial statements shall be adjusted for net asset increased in
combination. To avoid the duplicated computation of net asset of acquiree, for long-term equity
investment held by the Group before the consolidation, relevant profit and loss, other
comprehensive income and movement in other net asset, recognized for the period between the
combination date and later date when original shareholding is obtained and when the Group and
the acquiree are under common control of same ultimate controlling party, shall be respectively
used for writing down the opening balance of retained earnings of comparative financial
statements and profit and loss for the current period.
If a subsidiary is acquired not under common control, its operation results and cash flow shall be
consolidated since the beginning of the consolidation period. In preparation of the consolidated
financial statements, adjustments shall be made to subsidiary’s financial statements based on the
fair value of its all identifiable assets, liability or contingent liability on the acquisition date.
If a business consolidation under non-common control is finally achieved in stages, consolidation
accounting method shall be disclosed additionally for the period in which the control is obtained.
For example, if a business consolidation not under common control is finally achieved in stages,
when preparing the consolidated financial statements, the acquirer shall remeasure its previously
held equity interest in the acquiree at its acquisition-date fair value and recognize the resulting
gain or loss as investment income for the current period. Other comprehensive income, under
equity method accounting rising from the interest held in acquiree in relation to the period before
the acquisition, and changes in the value of its other equity other than net profit or loss, other
comprehensive income and profit appropriation shall be transferred to investment gain or loss
for the period in which the acquisition incurs, excluding the other comprehensive income from
the movement on the remeasurement of ne asset or liability of defined benefit plan.
When the Group partially disposes of the long –term equity investment in subsidiary without
losing the control over it, in the consolidated financial statements, the difference, between
disposals price and respective disposed value of share of net assets in the subsidiary since the
acquisition date or combination date, shall be adjusted for capital surplus or share premium, no
enough capital surplus, then adjusted for retained earnings.
When the Group partially disposes of the long –term equity investment in subsidiary and lose the
control over it, in preparation of consolidated financial statements, remaining share of interest in
the subsidiary shall be remeasured on the date of losing control. Sum of the share disposal
consideration and fair value of remaining portion of shareholding minus the share of the net assets
in the subsidiary held based on the previous shareholding percentage since the acquisition date or
39
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
combination date, the balance of above is recognized as investment gain/loss for the period and
goodwill shall be written off accordingly. Other comprehensive income relevant to share
investment in subsidiary shall be transferred to investment gain /loss for the period on the date of
losing control.
When the Group partially disposes of the long –term equity investment in subsidiary and lose the
control over it by stages, if all disposing transactions are bundled, each individual transaction shall
be seen as a transaction of disposal of a subsidiary by losing control. The difference between the
disposal price and the share of the net assets in the subsidiary held before the date of losing
control, shall be recognize as other comprehensive income until the date of losing control where it
is transferred into investment gain/ loss for the current period.
7. Joint arrangement classification and joint operation accounting
The Group’s joint arrangement includes joint operation and joint venture. For joint operation, the
Group as a joint operator shall recognize its own assets and its share of any assets held jointly, its
liabilities and its share of any liabilities incurred jointly, its revenue from the sale of its share of
the output arising from the joint operation, its share of the revenue from the sale of the output by
the joint operation; and its expenses, including its share of any expenses incurred jointly. When an
entity enters into a transaction with a joint operation in which it is a joint operator, such as a sale
or contribution of assets, it is conducting the transaction with the other parties to the joint
operation and, as such, the joint operator shall recognize gains and losses resulting from such a
transaction only to the extent of the other parties’ interests in the joint operation.
8. Cash and cash equivalent
The cash listed on the cash flow statements of the Group refers to cash on hand and bank deposit.
The cash equivalents refer to short-term (normally with original maturities of three months or less)
and liquid investments which are readily convertible to known amounts of cash and subject to an
insignificant risk of changes in value.
9. Translation of foreign currency
(1) Foreign currency transaction
Foreign currency transactions are translated at the spot exchange rate issued by People’s Bank of
China (“PBOC”) on the 1st day of the month when the transactions incurred. Monetary assets and
liabilities in foreign currencies are translated into RMB at the exchange rate prevailing at the
balance sheet day. Exchange differences arising from the settlement of monetary items are charged
as in profit or loss for the period. Exchange differences of specific borrowings related to the
acquisition or construction of a fixed asset should be capitalized as occurred, before the relevant
fixed asset being acquired or constructed is ready for its intended uses.
(2) Translation of foreign currency financial statements
The asset and liability items in the foreign currency balance sheet should be translated at a spot
exchange rate at the balance sheet date. Among the owner’s equity items except “undistributed
40
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
profit”, others should be translated at the spot exchange rate when they are incurred. The income
and expense should be translated at spot exchange rate when the transaction incurs. Translation
difference of foreign currency financial statements should be presented separately under the other
comprehensive income title. Foreign currency cash flows are translated at the spot exchange rate
on the day when the cash flows incur. The amounts resulted from change of exchange rate are
presented separately in the cash flow statement.
10. Financial assets and financial liabilities
The company shall recognize a financial asset or a financial liability when the company becomes
party to the contractual provisions of the instrument.
(1) Financial assets
1) Classification, recognition and measurement
The company shall classify financial assets as measured at amortized cost, fair value through other
comprehensive income or fair value through profit or loss on the basis of both the company’s
business model for managing the financial assets and the contractual cash flow characteristics of
the financial asset.
A financial asset shall be measured at amortized cost if both of the following conditions are met:
①the financial asset is held within a business model whose objective is to hold financial assets in
order to collect contractual cash flows;②the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding. At initial recognition, the company shall measure the financial asset at its fair
value and take any transaction costs that are directly attributable to the financial asset into account.
After initial recognition, the company shall measure the financial asset at amortized cost. A gain or
loss on a financial asset that is measured at amortized cost and is not a hedged item shall be
recognized in profit or loss when the financial asset is derecognized, impaired, involved in foreign
exchange or amortized for any difference arising between the initial recognized amount and due
amount by applying effective interest method.
A financial asset shall be measured at fair value through other comprehensive income if both of
the following conditions are met: ①the financial asset is held within a business model whose
objective is achieved by both collecting contractual cash flows and selling financial assets and
②the contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding. At initial
recognition, the company shall measure this financial asset at its fair value and take any
transaction costs that are directly attributable to the financial asset into account. A gain or loss on a
financial asset that is measured at fair value through other comprehensive income and is not a
hedged item shall be recognized in other comprehensive income apart from a gain or loss on credit
loss, foreign exchange and interest of the financial asset calculated by effective interest method.
Accumulated gain or loss previously in the other comprehensive income shall be out of it and
accounted in the profit or loss account when the financial asset is derecognized.
41
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
The company recognized interest revenue based on effective interest method. Interest revenue
shall be calculated by applying the effective interest rate to the gross carrying amount of a
financial asset, except for: ①purchased or originated credit-impaired financial assets. For those
financial assets, the company shall apply the credit-adjusted effective interest rate to the amortized
cost of the financial asset from initial recognition. ②financial assets that are not purchased or
originated credit-impaired financial assets but subsequently have become credit-impaired financial
assets. For those financial assets, the company shall apply the effective interest rate to the
amortized cost of the financial asset in subsequent reporting periods.
The company designates an investment as fair value measured through other comprehensive
income if an equity instrument held is not for trading. Once the decision is made, it is an
irrevocable election. At initial recognition, the company shall measure the equity instrument
investment not for trading at its fair value and take any transaction costs that are directly
attributable to the financial asset into account. Any other gain or loss (including foreign exchange
gain or loss) shall be accounted in other comprehensive income and shall not be subsequently
transferred to profit or loss, unless the dividend received is accounted in profit or loss( excluding
the recovered investment cost). Accumulated gain or loss previously in the other comprehensive
income shall be out of it and into retained earnings when the financial asset is derecognized.
Apart from classified as the amortized cost financial assets and as fair value through other
comprehensive income financial assets, a financial asset is classified as fair value through profit or
loss. At initial recognition, the company shall measure this financial asset at its fair value and take
any transaction costs that are directly attributable to the financial asset into account.
A financial asset shall be classified as fair value through profit or loss if it is recognized contingent
consideration through business combination, which is not under same control situation.
2) Recognition and measurement of transfer of financial assets
A financial asset is derecognized when any one of the following conditions is satisfied: ①the
rights to receive cash flows from the asset is terminated, ②the financial asset has been transferred
and the company transfers substantially all risks and rewards relating to the financial assets to the
transferee, ③the financial asset has been transferred to the transferee, the company has given up
its control of the financial asset although the company neither transfers nor retains all risks and
rewards of the financial asset.
In the case where the financial asset as a whole qualifies for the derecognition conditions, the
difference between the carrying value of transferred financial asset and the sum of the
consideration received for transfer and the accumulated amount of changes in fair value in respect
of the amount of partial derecognition (the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding) , that was previously recorded under other comprehensive income is
transferred into profit or loss for the period.
In the case where only part of the financial asset qualifies for derecognition, the carrying amount
42
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
of financial asset being transferred is allocated between the portions that to be derecognised and
the portion that continued to be recognised according to their relative fair value. The difference
between the amount of consideration received for the transfer and the accumulated amount of
changes in fair value that was previously recorded in other comprehensive income for the asset
partially qualified for derecognition (the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding) and the above-mentioned allocated carrying amount is charged to profit or
loss for the period.
(2) Financial liabilities
1) Classification, basis for recognition and measurement
Financial liabilities of the company are classified at initial recognition as “financial liabilities at
fair value through profit or loss” and “other financial liabilities” on initial recognition.
Financial liabilities at fair value through profit or loss include financial liabilities held for trading
and those designated as fair value through profit or loss on initial recognition. They are
subsequently measured at fair value. The net gain or loss arising from changes in fair value,
dividends and interest paid related to such financial liabilities are recorded in profit or loss for the
period in which they are incurred.
Other financial liabilities shall be subsequently measured at amortized cost by applying effective
interest method. The company shall classify a financial liability as a liability measured at
amortized cost except the followings: ①financial liability measured at fair value through profit or
loss including tradable financial liability (derivative instrument of financial liability included) and
designated as financial liability measured at fair value through profit or loss ② financial assets
transfers that do not qualify for derecognition or financial liability is formed from continuing
involvement in transferred assets ③ financial guarantee contract not in the above category of ①or
② and loan commitment which is not in the category ① at the below the market loan rate.
The company shall account the financial liability as it measured at fair value through profit or loss
if the financial liability is formed by contingent consideration recognized by the buyer through
business combination that is not under common control.
2) Financial liability derecognition
A financial liability is derecognized when the underlying present obligations or part of it are
discharged. Existing financial liability shall be derecognized and new financial liability shall be
recognized when the company signs the agreement with creditor to undertake the new financial
liability in replacement of existing financial liability, and the terms of agreement are different in
substance. Any significant amendment to the agreement as a whole or part o it is made, then the
existing liabilities or part of it shall be derecognized and financial liability after terms amendment
shall be recognized as a new financial liability. The difference between the carrying amount of the
financial liability derecognized and the consideration paid is recognized in profit or loss for the
period.
43
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
(3) Fair value measurement of financial asset and financial liability
The company uses the price in the primary market for financial assets and liability fair value
measurement, if no primary market exists, the price in the most advantageous market shall be used
for fair value measurement and applicable valuation techniques which enough data is available for
and supported by other information shall be adopted. Input for fair value measurement has 3 levels:
level 1 input is the unadjusted quoted price for identical asset or liability available at the active
market on the measurement date; level 2 input is the directly or indirectly observable input for
relevant asset or liability apart from level 1 input; level 3 input is the unobservable input for
relevant asset or liability.
(4) Financial asset and financial liability offset
Financial asset and financial liability shall be presented in the balance sheet separately and cannot
be offset, unless the following conditions are all met: ①the company has the legal right to
recognized offset amount and the right is enforceable. ②the company plans to receive or a legal
obligation to pay cash at net amount.
(5) Distinguishment between financial liability and equity instrument and accounting
financial liability and equity instrument shall be distinguished in accordance with the following
standards: ① if the company cannot unconditionally avoid paying cash or financial asset to fulfil a
contractual obligation, the contractual obligation is qualified or financial liability. For certain
financial instrument, although there are no clear terms and conditions to include obligation of
paying cash or other financial liability, contractual obligation may indirectly be formed through
other terms and conditions. ② the company’s own equity instrument shall also be considered
whether it is the substitute of cash, financial asset or it is the remaining equity, after the issuer
deducts liability, enjoyed by the equity holder , if it must or can be used to settle a financial asset.
If the former, the instrument is a financial liability of the issuer, otherwise it is an equity
instrument of the issuer. In certain circumstances, financial instrument contract is classified as
financial liability, if financial instrument contract specifies the company must or can use its own
equity to settle the financial instrument, the contractual amount of right or obligation equals to that
of the numbers of own equity instrument available or to be paid multiplied by fair value when
settling, nevertheless the amount is fixed, or varied partially or fully based on the its own equity’s
market price(such as interest rate, certain commodity’s or financial instrument’s price variance).
When classifying a financial instrument (or its component) in the consolidated statements, the
company takes all terms and conditions agreed by the group member and instrument holder into
consideration. If the group due to the instrument, as a whole, bears settlement obligation by
paying cash, other financial asset or other means resulted in financial liability, the instrument shall
be classified as financial liability.
If a financial instrument or its component is financial liability, any gain or loss, interest, dividend,
and any gain or loss from buy back or refinancing shall be accounted in profit or loss.
If a financial instrument or its component is an equity instrument, when it was issued(including
44
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
refinancing), bought back, sold or withdrawn, any change shall be regarded as equity change and
no fair value change shall be recognized.
(6) Financial asset impairment
Based on expected credit loss, a financial asset measured at amortized cost, a debt instrument
investment measured at FVTOCI and a contractual asset shall all be subject to impairment
accounting and be recognized for impairment loss allowance if any impairment.
Expected credit loss is the weighted average of credit losses with the respective risks of a default
occurring as the weights. A credit loss herein is referred to as the present value, at original
effective rate, of the difference between the contractual cash flows that are due to the company
under the contract; and the cash flows that the company expects to receive, that's the present value
of the total cash shortage. A financial asset shall be the present value, at credit adjusted effective
rate, if it is a purchased or originated credit -impaired asset.
The company adopts simplified approach for trade receivables, contract assets that do not contain
a significant financing component, and shall always measure the loss allowance at an amount
equal to lifetime expected credit losses.
Impairment requirements is to assess whether credit risk has been significantly increased since
initial recognition at each reporting date, if there have been significant increases in credit risk, the
company shall measure the loss allowance for a financial instrument at an amount equal to the
lifetime expected credit losses, at the reporting date, if the credit risk on a financial instrument has
not increased significantly since initial recognition, the company shall measure the loss allowance
for that financial instrument at an amount equal to 12month expected credit losses.
When assessing expected credit losses, the company considers all reasonable and supportable
information, including that which is forward-looking.
The company shall measure expected credit losses of a financial instrument in a way that reflects:
an unbiased and probabilityweighted amount that is determined by evaluating a range of possible
outcomes; The time value of money; and reasonable and supportable information that is available
without undue cost or effort at the reporting date about past events, current conditions and
forecasts of future economic conditions.
The company directly lowers the book value of the financial asset when contractual cash flow
cannot be fully or partially recollected within rational expectation any longer.
The company also assesses the expected credit loss of financial asset measured at amortized cost
based on aging portfolio, other than pastdue credit loss assessment based on individual item.
11. Notes receivable
（1） Recognition of provision for impairment
On the basis of expected credit loss, the company always measures the loss allowance at an
amount equal to lifetime expected credit losses for notes receivables which do not contain a
45
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
significant financing component and are generated in accordance with Revenue Standard- No 14
of Accounting Standard for Business Enterprise.
(2) Expected credit loss risk portfolio assessment method based on portfolio
The company separately assesses the credit risk of financial assets which have significantly
different the credit risk, such as receivable with dispute or involved in litigation and arbitration;
There are clear signs indicating the debtor is unlikely to fulfill the repayment obligations of the
receivables, etc.
Apart from the financial asset to be assessed for credit risk separately, the company divides the
financial assets into different group based on common characteristics of risk and assesses the risk
based on the portfolio.
Based on the acceptor credit risk of notes receivable as the common risk characteristics, it is
divided into different categories and determined for expected credit loss accounting estimate
policy.
Portfolio category Expected credit loss accounting estimate policy
Bank acceptance note portfolio Lower credit risk assessed by the management
Commercial acceptance note Same as receivables and provided for excepted credit loss
portfolio allowance
Referring to the experience of historical credit losses, the company prepares a table comparing the
aging of notes receivable with the fixed reserve rate to calculate the expected credit losses on this
basis.
The Company prepares the comparison table between receivables aging and expected credit loss
rate within lifetime and work out the expected credit loss by reference to historical credit loss
experience in combination with current situation and future forecast of economy condition.
The company shall measure expected credit losses of a financial instrument in a way that reflects:
an unbiased and probabilityweighted amount that is determined by evaluating a range of possible
outcomes; The time value of money; and reasonable and supportable information that is available
without undue cost or effort at the reporting date about past events, current conditions and
forecasts of future economic conditions.
The company prepares the comparison table between receivables aging and fixed provision rate
and work out the expected credit loss by reference to historical credit loss experience.
On the balance sheet date, expected credit loss of receivable shall be calculated. If the expected
credit loss is larger than the book value of the provision of receivable impairment, the difference
shall be recognized as receivable impairment loss, debit to “credit impairment loss”, credit to
“provision for bad debt”. Alternatively, the difference is recognized as impairment gain and
reversed journal entry shall be made.
Actually incurred credit loss shall be debit to “provision for bad debt”, credit to “notes receivable”,
based on the approved amount to be written off as it is assured as uncollectible receivable. If the
46
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
amount to be written off is bigger than the provision for impairment loss, the difference is debit to
“credit impairment loss”.
12. Accounts receivable
(1) Recognition of provision for impairment
On the basis of expected credit loss, the company always measures the loss allowance at an
amount equal to lifetime expected credit losses for trade receivables which do not contain a
significant financing component and are generated in accordance with Revenue Standard- No 14
of Accounting Standard for Business Enterprise. For trade receivables which do contain a
significant financing component, the company chooses as its accounting policy to measure the
loss allowance at an amount equal to lifetime expected credit losses.
(2) Expected credit loss risk portfolio assessment method based on portfolio
The company separately assesses the credit risk of financial assets which have significantly
different the credit risk, such as receivable with dispute or involved in litigation and arbitration;
There are clear signs indicating the debtor is unlikely to fulfill the repayment obligations of the
receivables, etc.
Apart from the financial asset to be assessed for credit risk separately, the company divides the
financial assets into different group based on common characteristics of risk and assesses the risk
based on the portfolio.
Apart from the trade receivables and other receivables to be assessed for credit risk separately,
based on the counterparty as the common risk characteristics, it is divided into different categories
and determined for expected credit loss accounting estimate policy.
Portfolio category Expected credit loss accounting estimate policy
Related parties portfolio within the
Lower credit risk assessed by the management
consolidation
Other related parties and non-related
Provided for excepted credit loss allowance
parties portfolio
Referring to the experience of historical credit losses, the company prepares a table comparing the
aging of accounts receivable with the fixed reserve rate to calculate the expected credit losses on
this basis.
On the balance sheet date, expected credit loss of receivable shall be calculated. If the expected
credit loss is larger than the book value of the provision of receivable impairment, the difference
shall be recognized as receivable impairment loss, debit to “credit impairment loss”, credit to
“provision for bad debt”. Alternatively, the difference is recognized as impairment gain and
reversed journal entry shall be made.
Actually incurred credit loss shall be debit to “provision for bad debt”, credit to “receivable”,
based on the approved amount to be written off as it is assured as uncollectible receivable. If the
47
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
amount to be written off is bigger than the provision for impairment loss, the difference is debit to
“credit impairment loss”
13. Receivables financing
In the process of managing enterprise liquidity, the Company carries out endorsement transfer or
discount of most of the notes receivable before maturity, and terminates the confirmation of the
discounted or endorsed notes receivable based on the fact that the Company has transferred almost
all the risks and rewards of the relevant notes receivable to the relevant counterparty. The
company's business model of managing notes receivable is aimed at both collecting the contract
cash flow and selling the financial asset, so it is classified as the financial asset measured at fair
value and its changes are included in other comprehensive income, and listed in the receivables
financing.
14.Other receivable
(1) Recognition of provision for impairment
On the basis of expected credit loss, the company always measures the loss allowance at an
amount equal to lifetime expected credit losses for trade receivables which do not contain a
significant financing component and are generated in accordance with Revenue Standard- No 14
of Accounting Standard for Business Enterprise. For trade receivables which do contain a
significant financing component, the company chooses as its accounting policy to measure the
loss allowance at an amount equal to lifetime expected credit losses.
(2) Expected credit loss risk portfolio assessment method based on portfolio
The company separately assesses the credit risk of financial assets which have significantly
different the credit risk, such as receivable with dispute or involved in litigation and arbitration;
There are clear signs indicating the debtor is unlikely to fulfill the repayment obligations of the
receivables, etc.
Apart from the financial asset to be assessed for credit risk separately, the company divides the
financial assets into different group based on common characteristics of risk and assesses the risk
based on the portfolio.
Apart from the trade receivables and other receivables to be assessed for credit risk separately,
based on the counterparty as the common risk characteristics, it is divided into different categories
and determined for expected credit loss accounting estimate policy.
Portfolio category Expected credit loss accounting estimate policy
Related parties portfolio within the
Lower credit risk assessed by the management
consolidation
Other related parties and non-related Same as receivables and provided for excepted credit loss
parties portfolio allowance
48
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Referring to the experience of historical credit losses, the company prepares a table comparing the
aging of other receivable with the fixed reserve rate to calculate the expected credit losses on
this basis.
The company prepares the comparison table between receivables aging and expected credit loss
rate within lifetime and work out the expected credit loss by reference to historical credit loss
experience in combination with current situation and future forecast of economy condition.
The company shall measure expected credit losses of a financial instrument in a way that reflects:
an unbiased and probabilityweighted amount that is determined by evaluating a range of possible
outcomes; The time value of money; and reasonable and supportable information that is available
without undue cost or effort at the reporting date about past events, current conditions and
forecasts of future economic conditions.
The company prepares the comparison table between receivables aging and fixed provision rate
and work out the expected credit loss by reference to historical credit loss experience.
On the balance sheet date, expected credit loss of receivable shall be calculated. If the expected
credit loss is larger than the book value of the provision of receivable impairment, the difference
shall be recognized as receivable impairment loss, debit to “credit impairment loss”, credit to
“provision for bad debt”. Alternatively, the difference is recognized as impairment gain and
reversed journal entry shall be made.
Actually incurred credit loss shall be debit to “provision for bad debt”, credit to “notes receivable”,
“receivable”, “other receivable” based on the approved amount to be written off as it is assured as
uncollectible receivable. If the amount to be written off is bigger than the provision for
impairment loss, the difference is debit to “credit impairment loss”
15. Inventories
Inventories are materials purchasing, raw material, variance of cost materials, low-valuable
consumable, materials processed on commission, working-in-progress, semi-finished goods,
variance of semi-finished goods, and finished goods, engineering construction etc.
The inventories are processed on perpetual inventory system, and are measured at their actual
cost on acquisition. Weighted average cost method is taken for measuring the inventory
dispatched or used. Low value consumables and packaging materials is recognized in the income
statement by one-off method.
After yearend thorough inventory check, at the balance sheet date inventory impairment should be
provided or adjusted according to inventory category. For the finished goods, raw material held
for sale etc which shall be sold directly, the net realizable value should be confirmed at the
estimated selling price less estimated selling expenses and related tax and expenses. The raw
material held for production, its realizable value should be confirmed at the estimated selling price
of finished goods less estimated cost of completion, estimated selling expenses and related tax.
The net realizable value of inventories held for execution of sale contracts or labor contracts shall
49
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
be calculated based on the contract price. If the quantities of inventories in the Group are more
than quantities if inventories subscribed in the sales contracts, the net realizable value of the
excessive part of the inventories should be calculated based on the general selling price. When the
impairment indicators disappear, impairment provision shall be reversed and
16. Contract assets
Contract assets are the rights of the Company to receive consideration for the goods it has
transferred to the customer, and such rights are subject to factors other than the passage of time. If
the Company sells two clearly distinguishable goods to a customer and is entitled to receive
payment for the delivery of one of the goods, but the payment is contingent on the delivery of the
other goods, the Company regards the right to receive payment as a contract asset.
The method for determining the expected credit loss of the contract assets shall refer to the
description of notes receivable and accounts receivable in notes 11 and 12 above.
Accounting method: the Company calculates the expected credit loss of the contract assets on the
balance sheet date. If the expected credit loss is greater than the carrying amount of the current
contract assets impairment provision, the Company will recognize the difference as an impairment
loss and debit "credit impairment loss" and credit "Contract assets impairment provision". On the
contrary, the Company recognizes the difference as impairment gain and makes opposite
accounting records.
If the Company actually suffers a credit loss and determines that the relevant contract assets
cannot be recalled, and the write-off is approved, the Company shall debit "impairment provisions
of contract assets" and credit "contract assets" according to the approved amount of write-off. If
the amount of write-off is greater than the allowance for loss accrued, the difference shall be
debited as "credit impairment loss".
17. Contract Cost
(1) The method for determining the amount of assets related to the contract cost
The Company's assets related to contract cost include contract performance cost and contract
acquisition cost.
Contract performance cost, that is, the cost of the Company to the contract, do not belong to other
accounting standards for enterprises the scope of the specification, and satisfy the following
conditions at the same time, as the performance contract cost recognized as an asset: the cost and
a current or expected is directly related to the contract, including direct materials, direct labor,
manufacturing cost (or similar fee), specific cost borne by the customer and only other cost arising
from this contract; this cost increases the Company's future resources for performance obligations;
the cost is expected to be recovered.
Contract acquisition cost, that is, the incremental cost incurred by the Company to acquire the
contract is expected to be recovered, shall be recognized as an asset as the contract acquisition
cost; if the amortization period of the asset does not exceed one year, it shall be recorded into the
50
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
current profit and loss at the time of occurrence. Incremental cost is cost (such as sales
commissions, etc.) that the Company would not incur without obtaining a contract. Expenses
incurred by the Company for the acquisition of the contract, in addition to the incremental cost
expected to be recovered (such as travel expenses incurred whether the contract is acquired or not,
etc.), shall be recorded into the current profit and loss when incurred, except those clearly borne
by the customer.
(2) Amortization of assets related to contract cost
The assets related to the contract cost of the Company shall be amortized on the same basis as the
commodity income recognition related to the assets and shall be recorded into the current profit
and loss.
(3) Impairment of assets related to the contract cost
When determining the impairment loss of assets related to the contract cost, the Company shall
first determine the impairment loss of other assets related to the contract recognized in accordance
with accounting standards for other relevant enterprises. If the carrying value is higher than the
residual consideration expected to be obtained by the Company due to the transfer of the
commodity related to the asset and the estimated cost to be incurred for the transfer of the
commodity, the excess part shall be set aside for impairment loss and recognized as an asset
impairment loss.
If the foregoing difference is higher than the carrying amount of the asset, the carrying amount of
the asset shall be converted back to the original provision for impairment of the asset and recorded
into the current profit and loss. However, the carrying amount of the asset after conversion shall
not exceed the carrying amount of the asset under the circumstance of no provision for
impairment of the asset.
18. Long-term receivables
(1) Confirmation method of impairment provisio
On the basis of expected credit losses, the Company will always measure its loss provision in
accordance with the amount equivalent to the expected credit losses in the entire duration for
long-term receivables formed by transactions regulated by the Accounting Standards for
Enterprises No. 14 - Income Standards that do not contain significant financing components.
Measurement of expected credit losses. Expected credit loss refers to the weighted average of the
credit loss of a financial instrument weighted by the risk of default. The credit loss herein refers to
the difference between all contractual cash flows receivable under the contract and all cash flows
expected to be received by the Company discounted at the original effective interest rate, i.e. the
present value of all cash shortfalls.
(2) A portfolio method to evaluate expected credit risk on the basis of portfolio
The Company evaluates the credit risk of financial assets with significantly different credit risks,
such as: long-term receivables that have disputes with the other party or involve litigation or
51
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
arbitration; Other receivables where there is a clear indication that the debtor is likely to be unable
to meet its obligations, etc.
Except for financial assets for which credit risk is assessed individually, the Company divides
financial assets into different groups based on common risk characteristics and evaluates credit
risk on a portfolio basis.
In addition to long-term receivables with single credit risk assessment, it is divided into different
combinations based on the relationship between long-term receivables transaction objects as the
common risk characteristics, and the expected credit loss accounting estimation policy is
determined:
Accounting policy for expected credit loss of portfolio classification
The related party portfolio management within the scope of the merger evaluates that such
projects have low credit risk
Other related parties and combinations of non-related parties shall draw impairment provisions in
accordance with the expected loss rate
With reference to historical credit loss experience and combined with the current situation and
forecast of future economic conditions, the company prepares a comparison table between the age
of long-term receivables and the expected credit loss rate of the entire duration to calculate the
expected credit loss.
The Company's method of measuring expected credit losses on financial instruments reflects
factors such as: an unbiased probability weighted average amount determined by evaluating a
range of possible outcomes; Time value of money; Reasonable and evidence-based information
about past events, current conditions, and projections of future economic conditions that are
available at no unnecessary additional cost or effort at the balance sheet date.
The Company calculates the expected credit loss of long-term receivables on the balance sheet
date. If the expected credit loss is greater than the carrying amount of the current impairment
provision for long-term receivables, the Company recognizes the difference as the impairment
loss for long-term receivables, debits the "credit impairment loss" and credits the "bad debt
provision". Instead, the company recognizes the difference as an impairment gain and makes the
opposite accounting record.
If the company decides that the related long-term receivables cannot be collected due to the actual
credit loss and is approved to cancel, the "bad debt reserve" and the "long-term receivables" shall
be debited and credited according to the approved amount of write-off. If the write-off amount is
greater than the loss provision already drawn, the difference will be debited to "credit impairment
loss" on a regular basis.
19. Long-term equity investment
Long term equity investments are the investment in subsidiary, in associated company and in joint
venture.
52
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Joint control is the contractual agreement sharing of control over an economic activity by all
participants or participants’ combination and decisions or policies relating to the operating activity
of the entity require the unanimous consent of the parties sharing the control.
Significant influence exists when the entity directly or indirectly owned 20% or more but less than
50% shares with voting rights in the investee company. If holding less than 20% voting rights, the
entity shall also take other facts or circumstances into accounts when judging any significant
influences. Factors and circumstances include: representation on the board of directors or
equivalent governing body of the investee, participation in financial or operating activities
policy-making processes, material transactions between the investor and the investee, interchange
of managerial personnel or provision of essential technical information.
When control exists over an investee, the investee is a subsidiary of an entity. The initial
investment cost for long-term equity investment acquired through business combination under
common control, is the carrying amount presented in the consolidated financial statements of the
share of net assets at the combination date in the acquired company. If the carrying amount of net
assets at the combination date in the acquired company is negative, investment shall be recognized
at zero.
If the equity of investee under common control is acquired by stages and business combination
incurs in the end, an entity shall disclose the accounting method for long-term equity investment
in the parent financial statement as a supplemental. For example, if the equity of investee under
common control is acquired by stages and business combination incurs in the end, and it’s a
bundled transaction, the entity shall regard all transactions as a one for accounting. If it’s not a
bundled transaction, the carrying amount presented in the consolidated financial statements of the
share of net assets at the combination date in the acquired company since acquisition is
determined as for the initial cost of long-term equity investment. The difference between the cost
initially recognized and carrying amount of long-term equity investment prior to the business
combination plus the newly paid consideration for further share acquired, and capital reserve shall
be adjusted accordingly. If no enough capital reserve is available for adjustment, retain earnings
shall be adjusted.
If long-term equity investment is acquired through business combination not under common
control, initial investment cost shall be the combination cost.
If the equity of investee not under common control is acquired by stages and business
combination incursion the end, an entity shall disclose the accounting method for long-term equity
investment in the parent financial statement as a supplemental. If the equity investment of investee
not under common control is acquired by stages and business combination incursion the end, and
it’s a bundled transaction, the entity shall regard all transactions as a one for accounting. If it’s not
a bundled transaction, the carrying amount of the equity investment held previously plus newly
increased investment cost are taken as the initial investment cost under cost model. If equity
investment is held under equity method before the acquisition date, other comprehensive income
under equity method previously shall not be adjusted accordingly. When disposing of the
53
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
investment, the entity shall adopt the same basis as the investee directly disposing of related assets
or liability for accounting treatment. Equity held prior to acquisition date as available for sale
financial assets under fair value model, accumulated change on fair value previously recorded in
other comprehensive shall be transferred into investment gain/loss for the period.
Apart from the long-term equity investments acquired through business combination mentioned
above, the cost of investment for the long-term equity investments acquired by cash payment is
the amount of cash paid. For long-term equity investment acquired by issuing equity instruments,
the cost of investment is the fair value of the equity instrument issued. For long-term equity
investment injected to the entity by the investor, the investment cost is the consideration as
specified in the relevant contract or agreement.
The Group adopts cost method to account for investment in subsidiary and equity method for
investment in joint venture and affiliate.
Long-term equity investment subsequently measured under cost model shall increase the carrying
amount of investment by adjusting the fair value of additional investment and relevant transaction
expenses. Cash dividend or profit declared by investee shall be recognized as investment gain/loss
for the period based on the proportion share in the investee.
Long-term equity investment subsequently measured under equity method shall be adjusted for its
carrying amount according to the share of equity increase or decrease in the investee. The entity
shall recognize its share of the investee’s net profits or losses based on the fair value of the
investee’s individual identifiable assets at the acquisition date, after making appropriate
adjustments thereto in conformity with the accounting policies and accounting period, and
offsetting the unrealized profit or loss from internal transactions entered into between the entity
and its associates and joint ventures according to the shareholding attributable to the entity and
accounted for as investment income and loss based on such basis.
On disposal of a long-term equity investment, the difference between the carrying value and the
consideration actually received is recognized as investment income for the period. For long-term
investments accounted for under equity method, the movements of shareholder’s equity, other than
the net profit or loss, of the investee company, previously recorded in the shareholder’s equity of
the Company are recycled to investment income for the period on disposal.
Where the entity has no longer joint control or significant influence in the investee company as a
result of partially disposal of the investment, the remaining investment will be changed to be
accounted for as available for sale financial assets, and the difference between the fair value of
remaining investment at the date of losing joint control or significant influence and its carrying
amount shall be recognized in the profit or loss for the year. Other comprehensive income
recognized from previous equity investment under equity model shall be accounted for on the
same basis as the investee directly disposing of related assets or liability when stopping using
under equity model.
Where the entity has no longer control over the investee company as a result of partially disposal
54
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
of the investment, the remaining investment will be changed to be accounted for using equity
method providing remaining joint control or significant influence over the investee company. The
difference between carrying amount of disposed investment and consideration received actually
shall be recognized in the profit and loss for the period as investment gain or loss, and investment
shall be adjusted accordingly as if it was accounted for under equity model since acquisition.
Where the entity has on longer joint control or significant influence in the investee as a result of
disposal, the investment shall be changed to be accounted for as available for sale financial assets,
and difference between the carrying amount and disposal consideration shall be recognized in
profit and loss for the period, and the difference between the fair value of remaining investment at
the date of losing control and its carrying amount shall be recognized in the profit or loss for the
year as investment gain or loss.
If the entity loses its control through partially disposal of investment by stages and it’s not a
bundled transaction, the entity shall account for all transactions separately. If it’s a bundled
transaction, the entity shall regard all transactions as one disposal of subsidiary by losing control,
but the difference between disposal consideration and carrying amount of the equity investment
disposed prior to losing control, which arises from each individual transaction shall be recognized
as other comprehensive income until being transferred into profit and loss for the period by the
time of losing control.
20. Investment property
The investment property includes property and building and measured at cost model
Useful life Estimated net
Category Annual depreciation rate
(years) residual value rate
Housing and Buildings 40 3% 2.43%
21. Fixed assets
Recognition criteria of fixed assets: defined as the tangible assets which are held for the purpose
of producing goods, rendering services, leasing or for operation & management, and have more
than one year of useful life.
Fixed assets shall be recognized when the economic benefit probably flows into the Group and its
cost can be measured reliably. Fixed assets include: building, machinery, transportation equipment,
electronic equipment and others.
All fixed assets shall be depreciated unless the fixed assets had been fully depreciated and are still
being used and land is separately measured. Straight-line depreciation method is adopted by the
Group. Estimated net residual value rate, useful life, depreciation rate as follows:
Useful life Estimated net Annual
No Category
(years) residual value rate depreciation rate
1 Housing and Buildings 20-40 3%,5%,10% 2.25-4.85%
55
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
2 Machinery equipment 10-22 3%,5%,10% 4.09-9.7%
3 Transportation equipment 4-15 3%,5%,10% 6-24.25%
4 Electronic equipment 5 3%,5%,10% 18-19.4%
5 Others equipment 10-15 3%,5%,10% 6-9.7%
The Group should review the estimated useful life, estimated net residual value and depreciation
method at the end of each year. If any change has occurred, it shall be regarded as a change in the
accounting estimates.
Finance lease shall be recognized when one of the conditions are met, (1) the ownership of the
asset belongs to the company when the lease term is due , (2) the company has the option to buy
the asset and buy price is far lower than the fair value when exercising the option. (3) lease term is
most of the asset life (4) no significant difference between the present value of minimum lease
premium and fair value on the lease commencement date.
On commencement date, leased asset shall be recognized at the lower of fair value and the PV of
minimum lease payment, long term payable shall be recognized at the minimum lease payment
and the difference is unrecognized financing expense.
The depreciation policy of the leased fixed assets shall be consistent with that of the self-owned
fixed assets. If the ownership of asset can be reliably acquired by the lease term due date, leased
asset shall be depreciated through the expected service life, otherwise, it shall be depreciated
within the lower of the lease term and expected service life of the asset.
22. Construction in progress
The criteria and time spot of constructions in progress’s being transferred to fixed assets:
Constructions in progress are carried down to fixed assets on their actual costs when completing
and achieving estimated usable status. The fixed assets that have been completed and reached
estimated usable status but have not yet been through completion and settlement procedures are
charged to an account according to their estimate values; adjustment will be conducted upon
confirmation of their actual values. The Group should withdraw depreciation in the next month
after completion.
23. Borrowing costs
The borrowing cost includes the interest expenses of the borrowing, amortization of underflow or
overflow from borrowings, additional expenses and the foreign exchange profit and loss because
of foreign currency borrowings. The borrowing costs incurred which can be directly attribute to
the fixed assets, investments properties, inventories requesting over 1 year purchasing or
manufacturing so to come into the expected condition of use or available for sale shall start to be
capitalized when expenditure for the assets is being occurred, borrowing cost has occurred,
necessary construction for bringing the assets into expected condition for use is in progress. The
borrowing costs shall stop to be capitalized when the assets come into the expected condition of
use or available for sale. The borrowing costs subsequently incurred should be recorded into profit
56
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
and loss when occurred. The borrowing costs should temporarily stop being capitalized when
there is an unusual stoppage of over consecutive 3 months during the purchase or produce of the
capitalized assets, until the purchase or produce of the asset restart.
The borrowing costs of special borrowings, deducting the interest revenue of unused borrowings
kept in the bank or the investment income from transient investment should be capitalized. The
capitalized amount of common borrowings should be calculated as follows: average assets
expenditure of the accumulated assets expenditure excess the special borrowing, multiplied by the
capital rate. The capital rate is the weighted average rate of the common borrowings.
24. Right of use assets
The right to use assets refers to the right of the Company as the lessee to use the leased assets
during the lease term.
(1) Initial measurement
On the commencement date of the lease term, the Company shall make an initial measurement of
the right to use assets at the cost. The cost includes the following four items: (1) The initial
measurement amount of lease liabilities; (2) The amount of the lease payment paid on or before
the commencement date of the lease term, if there is a lease incentive, will be deducted from the
amount of the lease incentive already enjoyed; (3) The initial direct costs incurred, namely the
incremental costs incurred to achieve the lease; (4) The cost expected to be incurred for the
demolition and removal of the leased asset, the restoration of the leased asset site or the restoration
of the leased asset to the state agreed in the lease terms, except those incurred for the production
of inventory.
(2) Follow-up measurement
After the commencement of the lease term, the Company shall adopt the cost model to carry out
subsequent measurement of the right to use assets, that is, to measure the right to use assets at the
cost minus accumulated depreciation and accumulated impairment losses. If the Company
re-measures the lease liabilities in accordance with the relevant provisions of the lease standards,
the book value of the right to use assets shall be adjusted accordingly.
Depreciation of usufruct assets
From the commencement date of the lease term, the Company shall make depreciation of the
usufruct. The usuary-use asset is usually depreciated in the month in which the lease begins (if the
enterprise chooses to depreciate in the month in which the lease begins, it needs to be depreciated
according to the specific situation described). The amount of depreciation deducted shall,
according to the use of the usufruct, be included in the cost of the relevant asset or the current
profit and loss.
When determining the depreciation method of the right to use assets, the Company shall make a
decision based on the expected consumption mode of the economic benefits related to the right to
use assets, and shall calculate and deduct the depreciation of the right to use assets by the straight
57
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
line method.
In determining the depreciable life of the use-right assets, the Company shall follow the following
principles: Where the ownership of the leased assets is reasonably determined at the end of the
lease term, depreciation shall be accrued during the remaining service life of the leased assets;
Where it is not reasonably certain that ownership of the leased asset will be acquired at the end of
the lease term, depreciation shall be accrued within the shorter period of the lease term or the
remaining useful life of the leased asset.
Impairment of the right to use assets
In case of impairment of the right to use assets, the Company shall carry out subsequent
depreciation according to the book value of the right to use assets after deducting the impairment
loss.
25. Intangible assets
The intangible assets of the Group refer to land use right and software. For acquired intangible
assets, the actual cost are measured at actual price paid and relevant other expenses. The cost
invested into intangible assets by investors shall be determined according to the stated value in the
investment contract or agreement, except for those of unfair value in the contract or agreement.
Land use right shall be amortized evenly within the amortization period since the remised
date.ERP system software and other intangible assets are amortized over the shortest of their
estimated useful life, contractual beneficial period and useful life specified in the law.
Amortization charge is included in the cost of assets or expenses, as appropriate, for the period
according to the usage of the assets. At the end of the year, for definite life of intangible assets,
their estimated useful life and amortization method shall be assessed. Any change shall be treated
as change on accounting estimate.
26. Impairment of long-term assets
The Group assesses at each balance sheet date whether there is any indication that long-term
equity investments, investment property, fixed assets, construction in progress and intangible
assets with definite useful life may be impaired. If there is any indication that an asset may be
impaired, the asset will be tested for impairment. Goodwill arising in a business combination
and intangible asset with infinite useful life are tested for impairment annually no matter there is
any indication of impairment or not.
Estimate of recoverable amount is the higher of its fair value less costs to sell and the present
value of the future cash flows expected to be derived from the asset.
If the recoverable amount of an asset is less than its carrying amount, the carrying amount shall be
impaired and the difference is recognised as an impairment loss and charged to profit or loss for
the period. Once an impairment loss on the assets is recognised, it is not reversed in a subsequent
period.
After assets impairment loss is recognized, depreciation and amortisation of the impaired asset
58
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
shall be adjusted in the following period so that the adjusted carrying amount(less expected
residual value) can be depreciated and amortised systematically within the remaining life.
When assessing goodwill for impairment, the carrying amount of goodwill shall be allocated
evenly to the assets group or assets portfolio. When testing the assets group or assets portfolio
including goodwill, if there is any indication of impairment , ignoring the goodwill and testing
the assets group or assets portfolio alone so to work out the recoverable amount and comparing to
its carrying amount and recognize the impairment loss. After that, testing the assets group or assets
portfolio with goodwill together, comparing the carrying amount of the assets group or assets
portfolio(including goodwill allocation) with recoverable amount , goodwill impairment shall be
recognized when the recoverable amount is lower than its carrying amount.
27. Long-term deferred expenses
Long-term deferred expenses of the Group refer to leasing expenses, redecoration expense and
others. The expenses should be amortized evenly over the beneficial period. If the deferred
expense cannot take benefit for the future accounting period, the unamortized balance of the
deferred expenses should be transferred into the current profit or loss. Leasing expenses will be
amortized within 10 years and 30years; redecoration expense and others will be amortized
within 3 years.
28. Contract liabilities
Contract liabilities reflect the Company's obligation to transfer the goods to the customer on
consideration received or receivable from the customer. Where the customer has paid the contract
consideration or the Company has obtained the right to receive the contract consideration
unconditionally before the transfer of the goods to the customer, the liability of the contract shall be
recognized in accordance with the amount received or receivable at the earlier point between the
actual payment made by the customer and the due payment.
29. Employee benefits
Employee’s benefit comprises short-term benefit, post-employment benefit, termination benefit
and other long-term employee’s benefit.
Short-term benefit includes salary, bonus, allowance, welfare, social insurance, housing funds,
labour union expense, staff training expense, during the period in which the service rendered by
the employees, the actually incurred short term employee benefits shall be recognized as liability
and shall be recognized in P&L or related cost of assets based on benefit objective allocated from
the service rendered by employees.
Post-employment benefits include the basic pension scheme and unemployment insurance etc.
Based on the risk and obligation borne by the Group, post-employment benefits are classified into
defined contribution plan and defined benefit plan. For defined contribution plan, liability shall be
recognized based on the contributed amount made by the Group to separate entity at the balance
sheet date in exchange of employee service for the period and it shall be recorded into current
59
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
profit and loss account or relevant cost of assets in accordance with beneficial objective.
Termination benefits are employee’s benefit payable as a result of either an entity’s decision to
terminate an employee’s employment before the contract due date or an employee’s decision to
accept voluntary redundancy in exchange for those benefits. An entity shall recognize the
termination benefits as a liability and an expense at the earlier date when the entity cannot
unilateral withdraw the termination benefits due to employment termination plan or due to
redundancy suggestion, or when the entity can recognize the restructuring cost or expense arising
from paying termination benefits.
Other long-term employee’s benefit refers to all other employee benefits other than short-term
benefit, post-employment benefit and termination benefit.
If other long-term employee’s benefit is qualified as defined contribution plan, contribution made
shall be recognized as liabilities accordingly for the period in which the service are rendered by
the employee and recognized in the profit or loss for the current period or relevant cost of assets.
Except other long-term employee’s benefit mentioned above, obligation arising from defined
benefit plan shall be recognized in the profit or loss for the current period or relevant cost of assets
in accordance with the period when the service are rendered by the employee.
30. Lease liability
(1) Initial measurement
The company shall initially measure the liabilities of the lease according to the present value of
the outstanding lease payments on the commencement date of the lease term.
1) Lease payment
The lease payment amount refers to the amount paid by the Company to the Lessor in connection
with the right to use the leased assets during the lease term, including: (1) Fixed payment amount
and substantial fixed payment amount, less the amount related to the lease incentive where there is a
lease incentive; (ii) variable lease payments dependent on indices or ratios, which are determined at
the initial measurement on the basis of the indices or ratios on the commencement date of the lease;
(3) The exercise price of the purchase option when the Company reasonably determines that the
purchase option will be exercised; (4) The term of the lease reflects the amount of money to be paid
for the termination of the lease option when the Company will exercise it; (5) The amount expected
to be paid based on the residual value of the guarantee provided by the Company.
2) Discount rate
When calculating the present value of the lease payments, the Company shall use the interest rate
embedded in the lease as the discount rate, which is the interest rate at which the sum of the present
value of the lease receipts and the present value of the unsecured residual value of the lessor is equal
to the sum of the fair value of the leased asset and the initial direct expenses of the Lessor. If the
company is unable to determine the inherent interest rate of the lease, the incremental borrowing rate
shall be used as the discount rate. Such incremental borrowing rate shall mean the interest rate
60
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
payable by the Company during a similar period under similar mortgage conditions in order to
acquire assets with a value similar to that of the usuable-use assets under similar economic
circumstances. The interest rate is related to: (1) the company's own situation, i.e., the company's
solvency and credit standing; ② The term of the "loan", i.e. the lease term; (3) The amount of
"borrowed" funds, that is, the amount of lease liabilities; (4) "collateral conditions", that is, the
nature and quality of the underlying assets; (5) Economic environment, including the jurisdiction
where the lessee is located, the valuation currency, the signing time of the contract, etc. The
company's bank loan interest rate/related lease contract interest rate/the company's latest similar
asset mortgage interest rate/the interest rate of bonds issued by the enterprise in the same period......
Based on the above adjustment factors to obtain the incremental borrowing rate.
(2) Follow-up measurement
On the commencement date of the lease term, the Company shall carry out subsequent
measurement of the lease liabilities according to the following principles: (1) Increase the carrying
amount of the lease liabilities when recognizing the interest of the lease liabilities; (2) Reduce the
carrying amount of lease liabilities when paying the lease payment; (3) When the lease payment
changes due to revaluation or lease change, the book value of the lease liability shall be measured
again.
The Company shall calculate the interest expense of the lease liability in each period of the lease
term at a fixed periodic interest rate and record it into the current profit and loss, except for those
that should be capitalized. The periodic interest rate refers to the discount rate used by the Company
for the initial measurement of lease liabilities, or the revised discount rate used by the Company for
the remeasurement of lease liabilities due to changes in lease payments or changes in lease.
(3) Re-measurement
After the commencement of the lease term, in the event of any of the following circumstances, the
Company shall re-measure the lease liabilities according to the present value of the lease payments
after the change and adjust the book value of the usufruct accordingly. If the book value of the right
to use assets has been reduced to zero, but the lease liabilities still need to be further reduced, the
company shall record the remaining amount into the profits and losses of the current period. (1)
Changes in the substantial fixed payment amount (in this case, the original discount rate is used to
discount); (2) The estimated amount payable of the residual value changes (in this case, the original
discount rate is used to discount); (3) Any change in the index or rate used to determine the lease
payment (in which case the revised discount rate is used); (4) The evaluation result of the call option
changes (in this case, the revised discount rate is used to discount); (5) Changes in the assessment
result or actual exercise of the lease option to renew or terminate the lease option (in which case, the
revised discount rate is used to discount the option).
31. Contingent liabilities
When the Company has transactions such as commitment to externals, discounting the trade
acceptance, unsettled litigation or arbitration which meets the following criterion, provision
61
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
should be recognized: It is the Company's present obligation; carrying out the obligation will
probably cause the Company's economic benefit outflow; the obligation can be reliably measured.
Provision is originally measured on the best estimate of outflow for paying off the present
obligations, and to consider the risk, uncertainty, time value of monetary relevant to contingent
items. If the time value of monetary is significant, the best estimate will be determined by
discounted cash outflow in the future. At each balance sheet date, the book value of provision is
reviewed and adjustment will be made on the book value if there is any change, in order to reflect
the current best estimate.
When compensation from the 3rd party is expected for full or partial contingent liability
settlement, the compensation shall be recognized as an asset separately and measured at no more
than the book value of contingent liability.
32. Share based payment
An equity-settled share-based payment in exchange for the employee’s services is measured at the
fair value at the date when the equity instruments are granted to the employee. Such fair value
during the vesting period of service or before the prescribed exercisable conditions are achieved is
recognised as relevant cost or expense on a straight-line during the vesting period based on the
best estimated quantity of exercisable equity instruments, accordingly increase capital reserve.
A cash-settled share-based payment is measured at the fair value at the date at which the Group
incurred liabilities that are determined based on the price of the shares or other equity instruments.
If it is immediately vested, the fair value of the liabilities at the date of grant is recognised as
relevant cost or expense, and corresponding liabilities. If it is exercisable only when the vesting
period of service is expired or the prescribed conditions are achieve, the fair value of liabilities
undertaken by the Group are re-measured at each balance sheet date based on the best estimate of
exercisable situation.
The fair value of the liabilities is re-measured at each balance sheet date. Any changes are
recognised in the profit or loss for the year.
If the granted equity instruments are cancelled within the vesting period, the equity instrument
shall be treated as accelerated vesting and the balance linked to the remaining vesting period shall
be recognized in the profit or loss account, accordingly be recognized in the capital reserve. If
employees or other parties can choose but fail to satisfy non-vesting conditions during the vesting
period, the Company sees this as cancellation of granted equity instruments.
33. Revenue
The revenue of the Company is mainly from sales of complete sets of equipment, engineering
installation.
The Company has performed the performance obligations in the contract, that is, when the
customer obtains the control right of the relevant goods or services, the revenue is recognized.
If the contract contains two or more performance obligations, the Company shall, at the beginning
62
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
of the contract, allocate the transaction price to each individual performance obligation according
to the relative proportion of the individual selling price of the commodities or services committed
by each individual performance obligation, and measure the income according to the transaction
price allocated to each individual performance obligation.
The transaction price is the amount of consideration to which the Company is expected to be
entitled as a result of the transfer of goods or services to the customer, excluding payments
received on behalf of third parties. The trading price recognized by the Company shall not exceed
the amount of accumulated recognized revenue that is highly unlikely to be materially reversed
when the relevant uncertainties are eliminated. Refunds to customers are expected to be excluded
from the transaction price as liabilities. Where there is a significant financing element in the
contract, the Company shall determine the transaction price based on the amount payable by the
assumed customer in cash upon acquisition of control over the goods or services. The difference
between the transaction price and the contract consideration shall be amortized over the term of
the contract using the effective interest rate method. On the commencement date of the contract,
the Company expects that the interval between the customer's acquisition of control of the goods
or services and the customer's payment shall not exceed one year, regardless of the significant
financing element existing in the contract.
If one of the following conditions is met, the Company shall perform its performance obligations
within a certain period of time; otherwise, the performance obligation shall be performed at a
certain point:
(1) When the customer performs the performance of the Company, it will obtain and consume the
economic benefits brought by the performance of the Company.
(2) The customer can control the commodities under construction during the performance of the
Company.
(3) The commodities produced by the Company during the performance of the contract shall have
irreplaceable uses, and the Company shall have the right to receive payment for the accumulated
performance part which has been completed so far during the entire contract period.
For the performance obligations performed within a certain period of time, the Company shall
recognize the income according to the performance progress within that period. If the performance
schedule cannot be reasonably determined and the Company is expected to be compensated for
the costs incurred, the revenue shall be recognized according to the amount of the cost incurred
until the performance schedule can be reasonably determined.
For performance obligations performed at a certain point, the Company recognizes revenue at the
point when the customer acquires control over the relevant goods or services. In determining
whether the customer has acquired control over the goods or services, the Company considers the
following indications:
(1). The Company shall have the right to receive the present payment for the goods or services.
63
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
(2) The Company has transferred the legal ownership of the goods to the customer.
(3) The Company has transferred the physical goods to the customer.
(4) The Company has transferred to the customer the major risks and rewards in the ownership of
the goods.
(5) The customer has accepted the goods or services, etc.
The Company determines whether it is the principal responsible person or the agent at the time of
the transaction based on whether it has control over the commodity before transferring it to the
customer. If the Company is able to control the commodity before transferring the commodity to
the customer, the Company shall be the main person responsible and shall recognize the income
according to the total amount received or the consideration; otherwise, the Company shall
recognize the income according to the amount of the commission or handling charge to be entitled
to be collected, which shall be the net amount after the total amount of consideration received or
receivable is deducted from the price paid to other relevant parties, or determined according to the
proportion of the established commission amount. The circumstances under which the Company
judges that it can control the goods before transferring them to the customer include:
(1) The Company shall transfer the control right of commodities or other assets to the customer
after the third party obtains the control right.
(2) The Company can lead a third party to provide services to customers on behalf of the
Company.
(3) After the Company acquires the control of the commodity by a third party, it transfers the
commodity to the customer by integrating it with other products into a group of outputs by
providing significant services.
In the specific determination of the ownership of a commodity prior to its transfer to a customer, it
is not limited to the legal form of the contract, but takes into account all relevant facts and
circumstances, including:
(1) The Company undertakes the main responsibility of transferring the goods to the customers.
(2) The Company shall bear the inventory risk of the goods before or after the transfer of the
goods.
(3) The Company shall have the right to determine the prices of the commodities to be traded.
(4) Other relevant facts and circumstances.
The Company's right to receive consideration for the goods or services it has transferred to the
customer (and such right is subject to factors other than the passage of time) is shown as a contract
asset, and the impairment of the contract asset is calculated on the basis of the expected credit loss.
The Company has the right to collect the consideration unconditionally from the customer as an
account receivable. The obligation of the Company to transfer the goods or services to the
customer upon receipt of the consideration receivable by the customer is shown as a contract
64
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
liability.
34. Government grants
A government grant shall be recognized when the Company complies with the conditions
attaching to the grant and when the Company is able to receive the grant.
Assets-related government grant is the government fund obtained by the Company for the
purpose of long-term assets purchase and construction or establishment in the other forms.
Income-related grants are the grant given by the government apart from the assets-related grants.
If no grant objective indicated clearly in the government documents, the Company shall judge it
according to the principle mentioned above.
Where a government grant is in the form of a transfer of monetary asset, it is measured at the
amount received. Where a government grant is made on the basis of fixed amount or conclusive
evidence indicates relevant conditions for financial support are met and expect to probably
receive the fund, it is measured at the amount receivable. Where a government grant is in the
form of a transfer of non-monetary asset, it is measured at fair value. If fair value cannot be
determined reliably, it is measured at a nominal amount of RMB1 Yuan.
Assets-related government grants are recognized as deferred income ore directly offsetting the
book value of the asset, and Assets-related government grants recognized as deferred income
shall be evenly amortized to profit or loss over the useful life of the related asset.
Any assets are sold, transferred, disposed off or impaired earlier than their useful life expired
date, the remaining balance of deferred income which hasn’t been allocated shall be carried
forward to the income statement when the assets are disposed off.
Income-related government grants that is a compensation for related expenses or losses to be
incurred in subsequent periods are recognized as deferred income and credited to the relevant
period when the related expense are incurred. Government grants relating to compensation for
related expenses or losses already incurred are charged directly to the profit or loss for the period.
Government grants related to daily business, shall be recognized as other income in accordance
with business nature, otherwise, shall be recognized as non-operating expenses.
If any government grant already recognized needs to be returned to the government, the
accounting shall be differed according to the following circumstances:
1) originally recognized as offsetting of related assets' book value, assets book value shall be
adjusted
2) if any deferred income, book value of deferred income shall be offset, excessive portion
shall be accounted into income statement
3) Other situation, it shall be accounted into income statement directly.
35. Deferred tax assets and deferred tax liabilities
The deferred income tax assets or the deferred income tax liabilities should be recognized
65
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
according to the differences (temporary difference) between the carrying amount of the assets or
liabilities and its tax base. Deferred tax assets shall be respectively recognized for deductible tax
losses that can be carried forward in accordance with tax law requirements for deduction of
taxable income in subsequent years. No deferred tax liabilities shall be recognized for any
temporary difference arising from goodwill initially recognition. No deferred tax assets or
liabilities shall be recognized for any difference arising from assets or liabilities initial recognition
on non-business combination with no effect on either accounting profit or taxable profit (or
deductible tax loss). At the balance sheet date, deferred tax assets and deferred tax liabilities are
measured at the tax rates that are expected to apply to the period when the asset is realized or
liability is settled.
Deferred tax assets are recognized to the extent that it is probable that future taxable profit will be
available to offset the deductible temporary difference, deductible loss and tax reduction.
36. Lease
(1) Accounting treatment of operating leases
(1) Identification of lease
A lease is a contract whereby the lessor assigns the right to the use of an asset to the lessee for a
certain period of time in exchange for consideration. On the commencement date of the contract,
the Company evaluates whether the contract is a lease or includes a lease. A contract is a lease or
includes a lease if a party assigns the right to control the use of one or more identified assets for a
certain period of time in exchange for consideration. To determine whether the contract
relinquishes the right to control the use of the identified assets for a given period, the Company
assesses whether the client under the contract is entitled to receive virtually all the economic
benefits arising from the use of the identified assets during the use period and is entitled to
dominate the use of the identified assets during the use period.
If the contract contains multiple separate leases at the same time, the company will divide the
contract and make accounting treatment for each separate lease. If the contract contains both
leasing and non-leasing parts, the company shall split the leasing and non-leasing parts for
accounting treatment.
(2) The Company acts as the lessee
On the commencement date of the lease term, the Company shall recognize the right to use assets
and liabilities of the lease. The recognition and measurement of right to use assets and lease
liabilities are shown in "27. Right to use Assets" and "33. Lease liabilities ".
2) Lease change
Lease change refers to the change of lease scope, lease consideration and lease term beyond the
terms of the original contract, including the increase or termination of the right to use one or more
leased assets, the extension or shortening of the lease term stipulated in the contract, etc. The
effective date of the lease change means the date on which the parties agree on the lease change.
66
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
If the lease changes and the following conditions are met at the same time, the Company will treat
the lease change as a separate lease for accounting: (1) The lease change expands the lease scope
or the lease term by increasing the right to use one or more leased assets; (2) The increased
consideration shall be equivalent to the amount of the individual price for the extended portion of
the lease scope or the extended lease term adjusted for the circumstances of the contract.
If the change of lease is not accounted for as a separate lease, the Company shall, on the effective
date of the change of lease, apportion the consideration of the contract after the change in
accordance with relevant provisions of the lease standards and redefine the lease period after the
change; The revised discount rate is used to discount the changed lease payment amount to
re-measure the lease liabilities. When calculating the present value of the lease payment after the
change, the Company shall use the lease embedded interest rate during the remaining lease period
as the discount rate; If it is not possible to determine the leasehold interest rate for the remaining
lease term, the Company shall use the lessee's incremental borrowing rate on the effective date of
the lease change as the discount rate. With respect to the impact of the above adjustment of lease
liabilities, the Company will make accounting treatment according to the following circumstances:
(1) If the change of lease results in the reduction of the scope of lease or the shortening of lease
term, the lessee shall reduce the book value of the right to use assets and record the profits or
losses related to partial or complete termination of lease into the current profit and loss. (2) If the
lease liabilities are remeasured due to other lease changes, the lessee shall adjust the book value of
the right to use assets accordingly.
3) Short-term leases and leases of low-value assets
For short-term leases with a lease term of no more than 12 months and low-value asset leases with
a lower value when each leased asset is a new asset, the Company chooses not to recognize the
right to use assets and lease liabilities. The Company will include the lease payments for
short-term leases and leases of low-value assets into the cost of the relevant assets or current
profits and losses during each period of the lease term in accordance with the straight-line method
or other systematically reasonable method.
(3) Our company is the lessor
On the basis that this Contract is or includes a lease as assessed in (1), the Company, as the lessor,
on the commencement date of the lease, divides the lease into a finance lease and an operating
lease.
If a lease substantially transfers almost all of the risks and rewards associated with ownership of
the leased asset, the lessor classifies the lease as a finance lease and any lease other than finance
lease as an operating lease.
The Company generally classifies a lease as a finance lease if it has one or more of the following
conditions: (1) At the end of the lease term, the ownership of the leased asset passes to the lessee;
(2) The lessee has the option to purchase the leased asset, and the purchase price entered into is
67
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
sufficiently low compared with the fair value of the leased asset at the time the option is expected
to be exercised, so that it can be reasonably determined on the commencement date that the lessee
will exercise the option; (3) Although the ownership of the asset is not transferred, the lease period
accounts for most of the service life of the leased asset (no less than 75% of the service life of the
leased asset); (4) On the lease commencement date, the present value of the lease receipts is
almost equivalent to the fair value of the leased asset (not less than 90% of the fair value of the
leased asset). ; ⑤ The leased assets are special in nature, and only the lessee can use them if
there is no major transformation. The Company may also classify a lease as a finance lease if it
has one or more of the following signs: (1) If the lessee cancels the lease, the lessee shall bear the
loss caused to the lessor by the cancellation; (2) the profit or loss generated by the fluctuation of
the fair value of the residual asset belongs to the lessee; (3) The lessee has the ability to continue
the lease at a rent far below the market level until the next period.
2) Accounting treatment of operating lease
Disposal of rent
During each period of the lease term, the Company will use the straight-line method/other
systematic and reasonable methods to recognize lease receipts from operating leases as rental
income.
Incentives offered
If the rent-free period is provided, the Company shall allocate the total rent by the straight line
method/other reasonable method throughout the lease period without deducting the rent-free
period, and shall recognize the rental income during the rent-free period. If the Company bears
certain expenses of the Lessee, such expenses shall be deducted from the total rental income and
distributed according to the balance of the rental income after deduction.
Initial direct cost
The initial direct expenses incurred by the Company in connection with the operating lease shall
be capitalized to the cost of the underlying assets under lease and shall be booked into the current
profits and losses in stages during the lease term on the same recognition basis as the rental
income.
Depreciation
For the fixed assets in the operating leased assets, the Company shall adopt the depreciation policy
for similar assets. Other operating leased assets shall be amortized in a systematic and reasonable
manner.
Variable lease payments
The variable lease payments obtained by the Company in connection with the operating lease and
not included in the lease receipts shall be recorded into the current profit and loss when actually
incurred.
68
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Changes in operating leases
If an operating lease changes, the Company will treat it as a new lease as of the effective date of
the change, and the amount received in advance or receivable for the lease related to the lease
before the change is regarded as the amount received for the new lease.
(2) Accounting treatment of finance lease
Initial measurement
On the commencement date of the lease term, the Company shall recognize the finance lease
receivable and terminate the recognition of the finance lease assets. In the initial measurement of
the finance lease receivables, the Group shall take the net lease investment as the recorded value
of the finance lease receivables.
The net lease investment is the sum of the present value of the unsecured residual value and the
lease receipts not yet received at the commencement of the lease period, discounted at the interest
rate contained in the lease. Lease revenue refers to the amount of money that the lessor should
collect from the lessee for the assignment of the right to use the leased assets during the lease term,
including: (1) the fixed amount and substantial fixed amount payable by the lessee; If there is a
lease incentive, the amount related to the lease incentive will be deducted; (ii) variable lease
payments dependent on indices or ratios, which are initially measured according to the indices or
ratios on the commencement date of the lease; (3) the exercise price of the option to buy, provided
that it is reasonably determined that the lessee will exercise the option; (4) the amount to be paid
by the lessee to exercise the termination option, provided that the lease term reflects that the lessee
will exercise the termination option; (5) Guarantee residual value provided to the lessor by the
lessee, the party related to the lessee and an independent third party who has the economic ability
to perform the guarantee obligation.
Subsequent measurement
The Company calculates and recognizes the interest income for each period of the lease term at a
fixed periodic interest rate. The periodic interest rate, it is to point to determine the net investment
in the lease use contains the discount rate (if relet, sublet's interest rate implicit in the lease cannot
be determined, using the original leasing of the discount rate (adjustments according to the initial
direct costs related to sublease)), or change in the financing lease is not as a separate lease
accounting treatment, and meet if changes to take effect on the lease beginning date, The lease
will be classified as a financial lease at the revised discount rate determined in accordance with
the relevant provisions.
Accounting treatment of lease changes
If the finance lease changes and meets the following conditions at the same time, the Company
will treat the change as a separate lease for accounting: (1) The change expands the scope of lease
by increasing the right to use one or more leased assets; (2) The increased consideration shall be
equivalent to the amount of the individual price of the expanded lease area adjusted for the
69
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
circumstances of the contract.
If the change of financing lease is not as a single lease accounting treatment, and meet if changes
to take effect on the lease beginning date, the lease will be classified as an operating lease terms,
the group since the day of the effect of the change of it as a new lease accounting treatment, and
prior to the effect of the change of the net investment in the lease as the book value of the leased
asset.
37. Other significant accounting policies, accounting Estimates
When preparing the financial statements, the management needs to use accounting estimate and
assumption, which will have effect on the application of accounting policy and amount of asset,
liability, income and expense. The actual circumstance maybe differs from the estimates. The
management needs to continuously assess the key assumption involved by estimate and the
judgment on uncertainty. Effect on the accounting estimate shall be recognized during the period
when estimate is changed and in future.
The following accounting estimate and key assumption will trigger the significant risk of
significant adjustment on the book value of asset and liability during the period of future.
（1） Impairment of receivable
Receivable is measured at amortized cost at the balance sheet date and assessed for any
impairment indicator and the acutely amount of impairment. Objective evidence for impairment
includes judgmental data of indicating significant decline of future cash flow of individual or
group of receivable, indicating significant negative financial performance of debtors. Had
receivable is recovered with certain proof, and in fact, it is relevant to the the matters subsequent
to the the loss recognition, the impairment recognized before shall be reversed.
（2） Provision of inventory impairment
Inventory is periodically evaluated at the net realizable value and any cost higher than NRV shall
be recognized as inventory impairment loss. When evaluating the NRV, net realizable value is
determined by deducting the expected selling expense and relative tax from the estimated selling
price. When actual selling price or cost differs from the previous estimates, management will
make adjustment on NRV. Therefore, the results based on the present experience may differ from
the actual results, which caused the adjustment on the carrying amount of inventory in the book.
Provision for inventory impairment may vary with the above reasons. Any adjustment on
provision for inventory impairment will affect the income statement.
（3） Provision of goodwill impairment
Each year, goodwill shall be assessed for any impairment. Recoverable amount of assets group
or asset portfolio including goodwill shall be the present value of future cash flow, which needs
estimates for calculation.
If management adjust the gross profit margin adopted by the present value of future cash flow
calculation of assets group or asset portfolio, adjusted gross profit margin is lower than the margin
70
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
applied, the impairment is required.
If management adjust the discounting rate before tax applied by the present value of future cash
flow calculation of assets group or asset portfolio, adjusted discounting rate before tax is higher
than the rate applied, the impairment is required.
If actual profit margin or discounting rate before tax is higher or lower than management’s
estimate, any impairment recognized before can not be reversed.
（4） Provision of fixed asset impairment
At the balance sheet date, the management shall implement impairment test on buildings, plant
and machinery etc which has any impairment indicator. The recoverable amount of FA is the
higher of PV of future cash flow and net value of fair value after disposal cost, the calculation
needs accounting estimate.
If management adjust the gross profit margin adopted by the present value of future cash flow
calculation of assets group or asset portfolio, adjusted gross profit margin is lower than the margin
applied, the impairment is required.
If management adjust the discounting rate before tax applied by the present value of future cash
flow calculation of assets group or asset portfolio, adjusted discounting rate before tax is higher
than the rate applied, the impairment is required.
If actual profit margin or discounting rate before tax is higher or lower than management’s
estimate, any impairment recognized before can not be reversed.
（5） Recognition of deferred tax assets
Estimate on deferred tax assets needs making estimation of taxable income and applied tax rate in
the following years in future. Whether deferred tax asset can be realized depends on the enough
probable taxable profit obtained in future. Tax rate change in future and the timing of temporary
difference reverse may also affect the income tax expense(income)and the balance of deferred tax.
Any change of estimate described here will cause the deferred tax adjustment.
（6） Useful life span of fixed assets and intangible assets
At least every year end, the management shall review the useful life of FA and intangible assets.
Expected useful life is based on the management’s experience on the same class of assets, with
reference to the estimate applied in the industry in conjunction with expected technology
development. When previous estimate significantly changed, depreciation and amortization in the
future shall be adjusted accordingly.
38. Changes in Accounting Policies, Accounting Estimates
None
VI. Taxation
1. The main applicable tax and rate to the Group as follows:
71
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Tax Tax base Tax rate
Value-added tax Sales revenue or Purchase 6%、9%、10%、13%、16%
(VAT)
City construction Value-added tax payables 7%
tax
Education surcharge Value-added tax payables 3%
Local education Value-added tax payables 2%
surcharge
Enterprise income Current period taxable profit 15% or 25%
tax(EIT)
70% of cost of own property or
Real estate tax 1.2% or 12%
revenue from leasing property
Land use tax Land using right area Fixed amount per square meter
Other tax According to the relevant
provisions of the state and local
Notes for tax entities with different EIT rate
Tax entities EIT rate
Bingshan Refrigeration & Heat Transfer Technologies Co.,Ltd 15%
Dalian Bingshan Group Engineering Co., Ltd. 25%
Dalian Bingshan Group Sales Co., Ltd. 25%
Dalian Bingshan Air-conditioning Equipment Co., Ltd. 15%
Dalian Bingshan Guardian Automation Co., Ltd. 15%
Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. 25%
Wuhan New World Refrigeration Industrial Co., Ltd. 15%
Bingshan Technology Service （Dalian） Co.,Ltd. 15%
Dalian Bingshan Engineering&Trading Co.,Ltd 25%
Dalian Universe Thermal Technology Co., Ltd. 15%
Dalian New Meica Electronics Technology Co., Ltd 15%
2. Tax preference
The Company obtained the qualification of high and new technology enterprises on 3rd December,
2020 approved by Dalian Science Technology Bureau, Dalian Finance Bureau, Dalian State Tax
Bureau and Local tax Bureau. The Certificate No. is GR202021200646, and the validity duration is
three years. According to the tax law, the Company can be granted for the preferential tax policy of
enterprise income tax rate of 15% in three years.
The Company’s subsidiary, Dalian Bingshan Air-conditioning Equipment Co., Ltd. obtained the
qualification of high and new technology enterprises on 3rd December, 2020 approved by Dalian
Science Technology Bureau, Dalian Finance Bureau, Dalian State Tax Bureau and Local tax
Bureau. The Certificate No. is GR202021200672, and the validity duration is three years.
72
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
According to the tax law, Bingshan Air-conditioning can be granted for the preferential tax policy
of enterprise income tax rate of 15% in three years.
The Company’s subsidiary, Dalian Bingshan Guardian Automation Co., Ltd. obtained the
qualification of high and new technology enterprises on 16th November, 2018 approved by Dalian
Science Technology Bureau, Dalian Finance Bureau, Dalian State Tax Bureau and Local tax
Bureau. The Certificate No. is GR20181200562, and the validity duration is three years. According
to the tax law, Bingshan Guardian can be granted for the preferential tax policy of enterprise
income tax rate of 15% in three years.
The Company’s subsidiary, Wuhan New World Refrigeration Industrial Co., Ltd obtained the
qualification of high and new technology enterprises on 15th November, 2018 approved by Hubei
Science Technology Bureau, Hubei Finance Bureau, Hubei State Tax Bureau and Hubei Local tax
Bureau. The Certificate No. is GR201842000605, and the validity duration is three years.
According to the tax law, Wuhan New World Refrigeration can be granted for the preferential tax
policy of enterprise income tax rate of 15% in three years.
The Company’s subsidiary, Dalian Universe Thermal Technology Co., Ltd. obtained the
qualification of high and new technology enterprises on 3rd December, 2020 approved by Dalian
Science Technology Bureau, Dalian Finance Bureau, Dalian State Tax Bureau and Local tax
Bureau. The Certificate No. is GR202021200570, and the validity duration is three years.
According to the tax law, Universe can be granted for the preferential tax policy of enterprise
income tax rate of 15% in three years.
The Company’s subsidiary, Dalian New Meica Electronics Technology Co., Ltd obtained the
qualification of high and new technology enterprises on 3rd December, 2020 approved by Dalian
Science Technology Bureau, Dalian Finance Bureau, Dalian State Tax Bureau and Local tax
Bureau. The Certificate No. is GR202021200699, and the validity duration is three years.
According to the tax law, New Meica can be granted for the preferential tax policy of enterprise
income tax rate of 15% in three years.
VII. Notes to Consolidated Financial Statements
1. Cash and cash in bank
Item Closing Balance Opening Balance
Cash on hand 37,599.67 99,580.64
Cash in bank 351,737,315.42 443,177,237.30
Other cash and cash equivalents 50,887,086.77 79,381,687.85
Total 402,662,001.86 522,658,505.79
Note: The total amount of restricted monetary funds at the end of the period was 50,887,086.77 Yuan,
including 30,671,478.54 Yuan for bank acceptance, 5,987,639.95 Yuan for letter of credit, 7,793,072.96
Yuan for letter of guarantee, 1,000,000.00 Yuan for migrant workers, and 5,434,895.32 Yuan for bank
accounts frozen due to litigation.
73
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
2. Notes receivable
(1) Category of notes receivable
Items Closing Balance Opening Balance
Bank acceptance notes 174,585,498.27 163,956,682.86
Commercial acceptance notes 7,369,594.80 2,473,682.88
Total 181,955,093.07 166,430,365.74
Closing Balance Opening Balance
Booking Provision for Provision for
Items Book Booking balance Book
balance bad debts bad debts
value value
Amount % Amount % Amount % Amount %
Including:
Notes
receivable with
181,955,093 166,430,365.
182,511,498.27 100.00 556,405.20 0.30 166,617,129.06 100.00 186,763.32 0.11
provision for .07 74
bad debts by
combination
Including:
Bank 174,585,498.
174,585,498.27 95.66 163,956,682.86 98.40 163,956,682.86
27
acceptance bill
trade
7,926,000.00 43.34 556,405.20 7.02 7,369,594.80 2,660,446.20 1.60 186,763.32 7.02 2,473,682.88
acceptance
draft
181,955,093.
Total 182,511,498.27 100.00 556,405.20 0.30
07
166,617,129.06 100.00 186,763.32 0.11 166,430,365.74
Provision for bad debts by combination:
Closing Balance
Items
Booking balance Bad debt provision Provision ratio
Trade acceptance
7,926,000.00 556,405.20 7.02%
draft
Instructions for determining the basis for this combination:
If the bad debt provision for bills receivable is accrued according to the general model of expected
credit loss, please refer to the disclosure method of other receivables to disclose the relevant
information of bad debt provision:
Applicable RNot applicable
(2) Provision for bad debts for the current period:
Provision for bad debts in the current period:
74
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Opening Change during the year Closing
Category
balance Accrued Collected/reversed Written-off Others Balance
Bad debt
provision for 186,763.32 369,641.88 556,405.20
notes receivable
Total 186,763.32 369,641.88 556,405.20
Among them, the amount of bad debt provision recovered or reversed in the current period is
important:
Applicable RNot applicable
(3)Notes receivable pledged by the company at the end of the period
Items Closing pledged amount
Bank acceptance notes 4,810,536.65
Total 4,810,536.65
(4) Notes receivable endorsed or discounted but not mature at the end of year:
Item Closing amount no more Closing amount still
recognized recognized
Bank acceptance notes 142,918,849.10
Total 142,918,849.10
3. Accounts receivable
(1) Category of accounts receivable
Closing Balance Opening Balance
Booking Provision for Provision for
Items Book Booking balance Book
balance bad debts bad debts
value value
Amount % Amount % Amount % Amount %
Accounts
receivable with
100.0 982,008,651. 371,763,867.6 821,548,67
1,355,303,774.28 373,295,122.39 27.54 1,193,312,546.52 100.00 31.15
provision for 0 89 7 8.85
bad debts by
combination
100.0 982,008,651. 371,763,867.6 821,548,67
Total 1,355,303,774.28
0
373,295,122.39 27.54
89
1,193,312,546.52 100.00
7
31.15
8.85
Provision for bad debts by combination:
Closing Balance
Items
Booking balance Provision %
within 1 year 749,445,703.10 52,611,088.36 7.02
1-2 years 150,287,415.03 25,158,113.28 16.74
2-3 years 63,997,681.96 19,730,485.35 30.83
3-4 years 159,385,816.51 78,625,023.28 49.33
4-5 years 125,733,377.22 90,716,631.66 72.15
more than 5 years 106,453,780.46 106,453,780.46 100.00
Total 1,355,303,774.28 373,295,122.39
75
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Instructions for determining the basis for this combination:
If the bad debt provision for accounts receivable is accrued according to the general model of
expected credit loss, please refer to the disclosure method of other receivables to disclose the
relevant information of bad debt provision:
Applicable RNot applicable
Disclosure by age
Aging Closing Balance
Within1 year 749,445,703.10
1to 2 years 150,287,415.03
2 to 3 years 63,997,681.96
More than 3 years 391,572,974.19
3 to 4 years 159,385,816.51
4 to 5 years 125,733,377.22
More than 5 years 106,453,780.46
Total 1,355,303,774.28
2) Bad debt provision accrued and written-off (withdraw)
Provision for bad debts in the current period:
Opening Change during the period Closing
Category
balance Accrued Collected/reversed Written-off Others Balance
Bad debt
provision
for 371,763,867.67 11,270,943.86 46,564.77 9,693,124.37 373,295,122.39
accounts
receivable
3) Accounts receivable written off in current period
Item Written off amount
Receivable actually written off 9,693,124.37
Among them, the important accounts receivable write-off situation:
Whether the
The nature Written off payment is
Written off Reason for
Company of accounts procedures caused by a
amount written off
receivable performed related
transaction
Tianjin Jitai
Quality Board
Technology payment 574,259.50 No
issues Resolution
Co., Ltd.
76
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Anyang
Client has
Zhongpin Board
payment 1,520,000.00 been No
Food Co., Resolution
bankrupted
Ltd.
Sanhui Food
Logistics Board
payment 1,189,926.00 Agreement No
(Tianjin) Co., Resolution
Ltd.
Qingdao
Haihe
Engineering Client has
Board
Group Co., payment 903,000.00 been No
Resolution
Ltd. bankrupted
(Shandong
Yurui)
Hebei
Client has no
Hongdao Board
payment 1,257,965.20 executable No
Technology Resolution
assets
Co., Ltd.
Total 5,445,150.70
4) The top five significant accounts receivable categorized by debtors
Closing % of the Closing Balance
Company
Balance total AR of Provision
Xinjiang Silk Road Tianshan International Food City
41,310,655.23 3.05 2,900,008.00
Investment Co., Ltd.
Hualu Engineering Technology Co., Ltd. 40,138,250.00 2.96 2,817,705.15
Panasonic Cold Chain (Dalian) Co., Ltd. 38,098,054.10 2.81 2,674,483.40
Xinyi Yuanda Construction and Installation
32,748,744.00 2.42 25,281,907.38
Engineering Co., Ltd.
Dalian Xinghaiwan Management and Development
24,020,836.00 1.77 18,577,302.85
Center
Total 176,316,539.33 13.01
4. Receivables financing
Items Closing Balance Opening Balance
Notes receivable 24,737,543.92 43,704,310.38
Total 24,737,543.92 43,704,310.38
Increase and decrease of receivables in financing capital period and changes in fair value
Applicable RNot applicable
77
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
If the provision for impairment of receivable financing is accrued according to the general model of
expected credit loss, please refer to the disclosure method of other receivables to disclose the
relevant information of impairment provision:
Applicable RNot applicable
5. Accounts paid in advance
(1) Aging of accounts paid in advance
Closing Balance Opening Balance
Items
Amount Percentage Amount Percentage
Within 1 year 151,577,102.96 67.21% 146,457,045.63 80.16%
1 to 2 years 42,665,123.96 18.92% 16,304,629.82 8.92%
2 to 3 years 16,412,801.81 7.28% 12,765,104.33 6.99%
Over 3 years 14,882,242.56 6.59% 7,174,623.77 3.93%
Total 225,537,271.29 182,701,403.55
Significant prepayment over 1 year
Closing Unsettled Reasons
Company Aging
Balance
Dalian Hengtong Refrigeration Equipment 5,720,000.00 2-3years
Contract is not fully implemented
engineering Co., Ltd 3-4years
3,878,617.15 Within 1 year
Dalian Shengda Construction Engineering Co., Ltd. 1-2 years Contract is not fully implemented
2,537,821.33 Within 1 year
PT MULTI SUKSES ENGINEERING Indonesia 1-2 years Contract is not fully implemented
1,960,914.00 Within 1 year
Ningbo Qianghao Mould Co., Ltd. 1-2 years Contract is not fully implemented
Nanjing Bingshan Electromechanical Equipment Co., 1,785,408.00
1-2 years Contract is not fully implemented
Ltd.
Total 15,882,760.48 — —
(2) The top five significant accounts paid in advance categorized by debtors
% of the total
Company Closing Balance Aging
advances to suppliers
Shenyang Baosteel Northeast Trading Co., Ltd. 19,521,694.79 Within 1 year 8.66
Dalian Shentong Electric Co., Ltd. 12,843,114.98 Within 1 yea 5.69
Shanghai Qingneng Cold Chain Equipment Engineering Co., Ltd. 11,969,675.07 Within 1 yea 5.31
Shanghai Daleng Refrigeration and Air Conditioning Equipment Co.,
9,226,800.00 Within 1 yea 4.09
Ltd.
Dalian Jindi Construction Labor Service Co., Ltd. 7,789,238.00 Within 1 yea 3.45
Total 61,350,522.84 27.2
6. Other receivables
78
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Items Closing Balance Opening Balance
Dividends receivable 12,864,770.89 1,003,568.75
Other receivable 170,075,172.03 59,336,527.70
Total 182,939,942.92 60,340,096.45
(1) Dividends receivable
1) Classification of Dividends Receivable
Items(or Investee) Closing Balance Opening Balance
Guotai Junan
Securities Co., Ltd. 7,418,805.44 952,000.00
Wuhan Iron and Steel
Co., Ltd. 25,923.75 51,568.75
Jiangsu Jingxue
Energy Saving 4,732,344.00
Technology Co., Ltd.
Dalian Bingshan
Group Huahuida
Financial Leasing Co., 687,697.70
Ltd.
Total 12,864,770.89 1,003,568.75
2)Provision for bad debts
Applicable RNot applicable
(2). Other receivables
1) Other receivables categorized by nature
Nature Closing Balance Opening Balance
Guarantee deposits 31,668,280.89 26,933,345.60
Petty cash 7,048,388.82 5,654,074.94
Receivables and Payables 37,746,399.88 36,138,235.04
Others 2,855,483.79 1,609,350.55
Thermoking Share Transfer 102,206,391.05
Total 181,524,944.43 70,335,006.13
2) Provision for bad debts
The first phase The second phase The third phase
Provision for bad debts Expected Credit Loss Expected Credit Loss for Total
Expected credit losses in the
for the duration (No the duration (Credit
next 12 months
Credit Devaluation) impairment has occurred)
Balance on January 1, 2022 6,828,531.31 4,169,947.12 10,998,478.43
The balance of January 1, 2022in
the current period
transfer to the third phase 4,169,947.12 4,169,947.12
Provision for bad debts 451,293.97 451,293.97
Balance on June 30, 2022 6,828,531.31 4,621,241.09 11,449,772.40
79
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Changes in book balances with significant changes in loss provisions in the current period
Applicable RNot applicable
Disclosure by age
Aging Closing Balance
Within 1 year 164,068,369.35
1-2 years 3,627,649.31
2-3 years 4,110,018.69
Over 3 years 9,718,907.08
3-4 years 3,461,616.39
4-5 years 1,961,060.69
Over 5 years 4,296,230.00
Total 181,524,944.43
3) Provisions for bad debts accrued, recovered or reversed in the current period
Provision for bad debts in the current period:
Opening Change during the year Closing
Category
balance Accrued Collected/reversed Written-off Others Balance
Provision for
bad debts of
10,998,478.43 451,293.97 11,449,772.40
other
receivables
Total 10,998,478.43 451,293.97 11,449,772.40
4) Other receivables from the top 5 debtors
% of
Closing Closing Balance
Name Category Aging the total
Balance of Provision
OR
Stock Within 1
Trane Technologies Europe Holdings 102,206,391.05 56.30
transfer year
Hangzhou Zhonghong New Energy Return Within 1
24,595,000.00 13.55 1,025,611.50
Technology Co., Ltd. payment year
Compensa
The People's Insurance Company of China Within 1
tion 5,000,000.00 2.75 208,500.00
Dalian Branch year
payments
Cangzhou Lingang Renguo Chemical Co., Within 1
Margin 2,000,000.00 1.10 83,400.00
Ltd. year
Moyu County Agricultural Bureau XC19-034 1-2 years
Margin 1,892,400.00 1.04 503,189.16
Contract Warranty Fund 2-3 years
Total 135,693,791.05 74.75 1,820,700.66
80
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
7. Inventories
(1) Categories of inventories
Closing Balance
Item
Book value Provision for decline Net book value
Raw materials 183,487,513.10 4,570,316.95 178,917,196.15
Working in progress 171,173,955.58 1,929,842.21 169,244,113.37
Finished goods 318,968,688.09 28,665,326.94 290,303,361.15
Contract performance cost 358,969,740.68 7,604,743.83 351,364,996.85
goods shipped in transit 29,557,522.14 29,557,522.14
Commissioned processing
1,723,151.16 1,723,151.16
materials
Low-value consumable 200,593.46 200,593.46
Self-manufactured
28,607,876.30 28,607,876.30
semi-finished products
House acquired as payment
9,282,384.10 5,203,103.50 4,079,280.60
for a debt
Total 1,101,971,424.61 47,973,333.43 1,053,998,091.18
(Continue)
Opening Balance
Item
Book value Provision for decline Net book value
Raw materials 166,815,875.73 4,570,316.95 162,245,558.78
Working in progress 171,554,710.97 1,929,842.21 169,624,868.76
Finished goods 300,140,274.98 29,448,083.12 270,692,191.86
Contract performance
295,750,380.56 11,185,200.11 284,565,180.45
cost
goods shipped in transit 86,049,156.11 86,049,156.11
Commissioned
887,585.94 887,585.94
processing materials
Low-value consumable 51,817.59 51,817.59
Self-manufactured
30,747,861.83 30,747,861.83
semi-finished products
House acquired as
14,866,010.00 5,203,103.50 9,662,906.50
payment for a debt
Total 1,066,863,673.71 52,336,545.89 1,014,527,127.82
(2) Provision for impairment of inventories and provision for impairment of contract
performance costs
Increase Decrease
Opening Closing
Item Reverse/ Others
Balance Accrual Other Balance
Written- off transferred
Raw materials 4,570,316.95 4,570,316.95
Working in progress 1,929,842.21 1,929,842.21
Finished goods 29,448,083.12 782,756.18 28,665,326.94
81
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Increase Decrease
Opening Closing
Item Reverse/ Others
Balance Accrual Other Balance
Written- off transferred
Contract performance cost 11,185,200.11 3,580,456.28 7,604,743.83
House acquired as payment
5,203,103.50 5,203,103.50
for a debt
Total 52,336,545.89 0.00 0.00 4,363,212.46 47,973,333.43
8. Contract assets
Closing Balance Opening Balance
Item Provision for Net book Provision for Net book
Book value Book value
decline value decline value
Unexpired
142,784,708.83 16,620,265.89 126,164,442.94 125,891,499.90 16,031,841.11 109,859,658.79
warranty money
Total 142,784,708.83 16,620,265.89 126,164,442.94 125,891,499.90 16,031,841.11 109,859,658.79
If the provision for impairment of contract assets is accrued according to the general model of
expected credit loss, please refer to the disclosure method of other receivables to disclose the
relevant information of impairment provision:
Applicable RNot applicable
Provision for bad debt
Item Accrued Collected/reversed Written-off reason
Unexpired warranty money 588,424.79
Total 588,424.79 --
9. Non-current assets maturing within one year
Item Closing Balance Opening Balance
Long-term receivables due within one year 14,990,989.30 14,990,989.30
Total 14,990,989.30 14,990,989.30
10. Other current assets
Item Closing Balance Opening Balance
Prepaid income tax presented
18,348.62 380,483.32
at net amount after offsetting
Input VAT to be deducted 11,631,457.88 23,989,939.28
Prepaid expenses 375,752.93 154,654.11
Prepaid turnover tax 5,651,739.77
Total 17,677,299.20 24,525,076.71
82
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
11.Long-term equity investments
Increase/Decrease
Gains and Provision
Adjustmen
Beginning losses Cash bonus for Provision for
Investee t of other Change of Ending balance
balance recognized or profits impairment impairment
Increased Decreased comprehen other Others
under the announced of the
sive equity
equity to issue current
income
method period
Panasonic Cold Chain (Dalian) Co.,
90,330,037.43 -17,939,591.19 72,390,446.24
Ltd.
Panasonic Compressor (Dalian) Co.,
460,060,249.49 18,414,454.28 34,122,000.00 444,352,703.77
Ltd.
Dalian Benzhuang Chemical Co., Ltd. 8,926,266.52 384,787.54 9,311,054.06
Songzhi Dayang Cooling and Heating
58,799,068.28 1,211,480.90 60,010,549.18
Technology (Dalian) Co., Ltd.
Beijing Huashang Bingshan
Refrigeration and Air Conditioning 2,139,942.18 3,596.55 2,143,538.73
Equipment Co., Ltd.
Dalian Fuji Bingshan Vending Machine
148,656,014.75 -5,441,140.87 143,214,873.88
Co., Ltd.
Lingzhong Bingshan Refrigeration
14,923,803.87 401,999.21 15,325,803.08
(Dalian) Co., Ltd.
Dalian Bingshan Group Huahuida
44,789,319.55 511,557.51 687,697.70 44,613,179.36
Financial Leasing Co., Ltd.
Jiangsu Jingxue Energy Saving
201,731,528.04 3,255,908.10 4,732,560.00 200,255,092.14
Technology Co., Ltd.
Panasonic Refrigeration System
28,480,784.93 1,517,604.68 1,527,045.45 28,471,344.16
(Dalian) Co., Ltd.
Dalian Bingshan Metal Technology
168,294,942.93 14,605,911.92 182,900,854.85
Co., Ltd.
Wuhan Scaf Power Control Equipment
4,372,575.48 28,833.46 4,401,408.94
Co., Ltd.
Total 1,231,504,533.45 16,955,402.09 41,069,087.15 1,207,390,848.39
83
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
12. Other non-current financial assets
Item Closing Balance Opening Balance
Financial assets classified as fair value through
167,515,974.19 261,410,664.61
profit or loss
Total 167,515,974.19 261,410,664.61
13. Investment property
Property& Construction in
Item Land-use-rights Total
Building progress
I. Initial Cost
1. Opening Balance 230,594,490.07 26,094,438.38 256,688,928.45
2. Increase
(1) Outsourcing
(2)Inventory\fixed
assets\construction-in-progress
transfer
(3)Business combination
increase
3. Decrease
(1) Disposal
(2)Transferred to other
4. Closing Balance 230,594,490.07 26,094,438.38 256,688,928.45
II. Accumulated Depreciation
and Accumulated
Amortization
1. Opening Balance 123,629,414.79 12,306,704.05 135,936,118.84
2. Increase 3,112,769.07 260,944.38 3,373,713.45
(1)Provision or amortization 3,112,769.07 260,944.38 3,373,713.45
3. Decrease
(1) Disposal
(2) Transferred to other
4. Closing Balance 126,742,183.86 12,567,648.43 139,309,832.29
III. Impairment Reserve
1. Opening Balance
2. Increase
(1)Provision
3. Decrease
(1) Disposal
(2) Transferred to other
4. Closing Balance
IV. Book Value
1. Closing book value 103,852,306.21 13,526,789.95 117,379,096.16
2. Opening book value 106,965,075.28 13,787,734.33 120,752,809.61
84
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
14. Fixed assets
Items Closing Book Value Opening Book Value
Fixed asset 831,680,902.75 855,395,405.85
Total 831,680,902.75 855,395,405.85
(1) Fixed assets detail
Property& Machinery Transportation Other
Item Equipment Total
buildings Equipment Equipment
I. Initial Cost 695,343,883.14 617,253,312.03 12,914,199.47 61,535,741.18 1,387,047,135.82
1. Opening Balance 695,343,883.14 617,253,312.03 12,914,199.47 61,535,741.18 1,387,047,135.82
2. Increase 987,072.39 13,435,837.39 374,178.83 2,253,699.10 17,050,787.71
(1) Purchase 13,064,489.32 374,178.83 417,413.39 13,856,081.54
(2) Transferred
from
987,072.39 371,348.07 1,836,285.71 3,194,706.17
construction-in-pro
gress
(3) Acquired from
business
combination
3. Decrease 6,996,198.69 1,411,501.40 1,629,825.83 10,037,525.92
(1) Dispose or
6,996,198.69 1,411,501.40 1,629,825.83 10,037,525.92
scrap
4. Closing Balance 696,330,955.53 623,692,950.73 11,876,876.90 61,770,034.45 1,393,670,817.61
II. Accumulated
131,345,400.98 341,061,738.95 8,806,440.56 50,162,389.94 531,375,970.43
Depreciation
1. Opening Balance 131,345,400.98 341,061,738.95 8,806,440.56 50,162,389.94 531,375,970.43
2. Increase 9,040,322.97 24,787,137.13 339,270.31 2,578,191.73 36,744,922.14
(1)Accrued 9,040,322.97 24,787,137.13 339,270.31 2,578,191.73 36,744,922.14
3. Decrease 73,881.24 3,175,366.69 911,486.07 1,466,843.25 5,627,577.25
(1) Disposal or
73,881.24 3,175,366.69 911,486.07 1,466,843.25 5,627,577.25
scrap
4. Closing Balance 140,311,842.71 362,673,509.39 8,234,224.80 50,494,578.42 561,714,155.32
III. Impairment
Reserve
1. Opening Balance 275,759.54 275,759.54
2. Increase
(1)Accrued
3. Decrease
(1) Disposal or
85
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Property& Machinery Transportation Other
Item Equipment Total
buildings Equipment Equipment
scrap
4. Closing Balance 275,759.54 275,759.54
IV. Book Value
1. Closing book
556,019,112.82 260,743,681.80 3,642,652.10 11,275,456.03 831,680,902.75
value
2. Opening book
563,998,482.16 275,915,813.54 4,107,758.91 11,373,351.24 855,395,405.85
value
15. Construction-in-progress
Item Closing book value Opening book value
Construction-in-progress 50,556,431.55 38,974,478.45
Total 50,556,431.55 38,974,478.45
(1) Construction in progress details
Closing Balance Opening Balance
Item
Book Balance Provision Book Value Book Balance Provision Book Value
Renovation of
buildings and
3,067,968.64 3,067,968.64 4,330,904.06 4,330,904.06
ancillary
facilities
Installation and
renovation of
machine tools 38,206,637.12 38,206,637.12 24,409,028.60 24,409,028.60
and mechanical
equipment
Smart
Manufacturing 1,087,160.60 1,087,160.60 1,069,880.60 1,069,880.60
Software
Equipment
Financial 9,164,665.19 970,000.00 8,194,665.19 9,164,665.19 9,164,665.19
Leasing Project
Total 51,526,431.55 970,000.00 50,556,431.55 38,974,478.45 38,974,478.45
(2) Change in the significant construction in progress
Includi
ng:
Amou Percen Accum Interes
Progre Accum
Openi nt Closin t of ulated t
Other ss ulated Source
ng Increa transfe g invest capital capital
Name Budget reducti of capital of
Balanc se rred to Balanc ment ized ization
ons constr ized funds
e fixed e against interes rate(%
uction interes
assets budget t )
t of the
year
86
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Renovatio
n of
buildings 15,241,000.0
4,330,904.06 317,367.29 1,580,302.71 3,067,968.64 30.00% 30%
0
and
ancillary
facilities
Installation
and
renovation
50,358,032.0 24,409,028.6 13,826,812.0 38,206,637.1
of machine 0 0 6
29,203.54
2
76.00% 76%
tools and
mechanical
equipment
Smart
Manufactu 3,330,750.00 1,069,880.60 17,280.00 1,087,160.60 33.00% 33%
ring
Software
Equipment
Financial 15,020,000.0
9,164,665.19 9,164,665.19 61.00% 61%
0
Leasing
Project
83,949,782.0 38,974,478.4 14,161,459.3 51,526,431.5
1,609,506.25
Total 0 5 5 5
16. Right of use assets
Mechanical Transportatio Electronic
Item Buildings Total
equipment n Equipment equipment
I. Initial Cost
1. Opening Balance 4,827,598.49 28,234,690.39 334,540.86 526,894.11 33,923,723.85
2. Increase
3. Decrease 9,575,952.95 9,575,952.95
4. Closing Balance 4,827,598.49 18,658,737.44 334,540.86 526,894.11 24,347,770.90
II.Accumulated
depreciation
1. Opening Balance 1,654,921.59 8,078,883.59 111,513.62 143,701.68 9,989,020.48
2. Increase 1,901,829.31 1,311,829.19 3,213,658.50
(1)Accrued 1,901,829.31 1,311,829.19 3,213,658.50
3. Decrease
(1) Disposal 4,962,499.34 4,962,499.34
4. Closing Balance 3,556,750.90 9,390,712.78 111,513.62 143,701.68 8,240,179.64
III. Impairment Reserve
1. Opening Balance
2. Increase
(1)Accrued
3. Decrease
(1) Disposal
87
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Mechanical Transportatio Electronic
Item Buildings Total
equipment n Equipment equipment
4. Closing Balance
IV. Book Value
1. Closing book value 1,270,847.59 9,268,024.66 223,027.24 383,192.43 16,107,591.26
2. Opening book value 3,172,676.90 20,155,806.80 223,027.24 383,192.43 23,934,703.37
17. Intangible assets
(1) Intangible assets list
Land use Patent Non Patent
Item Others Total
right technology technology
I. Initial Cost
1. Opening Balance 151,187,270.24 17,630,188.82 5,000,000.00 34,007,344.48 207,824,803.54
2. Increase 674,988.09 674,988.09
(1) Purchase 674,988.09 674,988.09
(2) Internal R&D
(3)Acquired from business
combination
3. Decrease
(1) Disposal
4. Closing Balance 151,187,270.24 17,630,188.82 5,000,000.00 34,682,332.57 208,499,791.63
II.Accumulated
amortization
1. Opening Balance 39,273,017.51 7,611,159.85 3,000,004.00 15,347,884.08 65,232,065.44
2. Increase 1,523,216.67 791,799.14 214,480.34 2,324,010.61 4,663,659.26
(1)Accrued 1,523,216.67 791,799.14 2,324,010.61 4,663,659.26
3. Decrease
(1) Disposal
4. Closing Balance 40,820,867.02 8,402,958.99 3,000,004.00 17,671,894.69 69,895,724.70
III. Impairment Reserve
1. Opening Balance
2. Increase
(1)Accrued
3. Decrease
4. Closing Balance
IV. Book Value
1. Closing book value 110,366,403.22 9,227,229.83 1,999,996.00 17,010,437.88 138,604,066.93
2. Opening book value 111,914,252.73 10,019,028.97 1,999,996.00 18,659,460.40 142,592,738.10
88
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
18. Goodwill
(1) Original cost of goodwill
Increased during Decreased during
current year current year
Opening Closing
Name Enterprise
Balance Balance
s merger Other Disposal Other
increase
Dalian Nevis Cooling and
Heating Technology Co., 1,440,347.92 1,440,347.92
Ltd.
Dalian Bingshan Group
310,451.57 310,451.57
Engineering Co., Ltd.
Total 1,750,799.49 1,750,799.49
19. Long-term unamortized expense
Opening Other Closing
Item Increase Amortization
Balance Decrease Balance
Employee’s dormitory use right 1,735,213.74 69,239.16 1,665,974.58
Renovation and rebuilding 1,020,822.14 53,145.00 701,952.14 265,725.00
Membership fee 407,000.00 8,250.00 398,750.00
Entry fee for the use of hot and
93,356.25 93,356.25 0.00
cold machine technology
New plant greening fee 4,832,292.10 490,847.60 4,386,234.34
Accounts Receivable Factoring 598,200.40 598,200.40
Amortization of jigs and molds 195,538.35 150,748.51
Total 8,088,684.23 793,738.75 714,838.01 701,952.14 7,465,632.83
20. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets without offsetting
Item Closing Balance Opening Balance
Deductible Deferred tax Deductible temporary Deferred tax
temporary assets difference assets
difference
Provision for
385,301,299.99 77,369,493.54 367,572,645.45 77,433,815.32
impairment of assets
Unrealized profit from
63,838,006.28 10,533,271.04 55,608,764.16 10,412,376.27
internal transaction
Deductible loss 15,173,783.01 2,276,067.45 13,555,883.61 2,033,382.54
Total 464,313,089.28 90,178,832.03 436,737,293.22 89,879,574.13
(2) Deferred tax liabilities without offsetting
Item Closing Balance Opening Balance
Taxable temporary Deferred tax Taxable temporary Deferred tax
difference liabilities difference liabilities
Changes in the fair value
154,922,113.60 23,238,317.04 237,308,998.02 35,596,349.70
of other non-current
89
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
financial assets
Total 154,922,113.60 23,238,317.04 237,308,998.02 35,596,349.70
(2) Deferred income tax assets or liabilities shown net of offset
The amount of deferred
Deferred tax assets and The ending balance of a The beginning balance of
tax assets and liabilities
Item liabilities at the end of deferred tax asset or a deferred tax asset or
offset at the beginning of
the balance liability after offset liability after offset
the period
Deferred tax assets 90,178,832.03 89,879,574.13
Deferred tax liabilities 23,238,317.04 35,596,349.70
(4) Unrecognized deferred tax assets details
Item Closing Balance Opening Balance
Deductible temporary difference 17,516,837.42 7,106,167.83
Deductible loss 118,270,112.74 111,303,027.15
Total 135,786,950.16 118,409,194.98
(5) Unrecognized deductible loss of deferred tax assets expired years
Year Closing Balance Opening Balance Notes
2022 716,158.09
2023 16,458,262.38 16,458,262.38
2024 61,554,422.97 61,554,422.97
2025 21,436,832.18 21,436,832.18
2026 124,607,476.02 124,607,476.02
32,599,505.16
Total 256,656,498.71 224,773,151.64
21. Short-term loan
(1) Category of short term loan
Loan category Closing Balance Opening Balance
Pledge loan 6,538,425.00
Mortgage loan 9,025,000.00
Credit loan 240,000,000.00 230,373,666.72
Total 240,000,000.00 245,937,091.72
22. Notes payable
Notes category Closing Balance Opening Balance
Commercial acceptance notes 310,250,185.76 372,141,300.89
Bank acceptance notes 10,427,400.00 7,891,738.67
Total 320,677,585.76 380,033,039.56
23. Accounts payable
(1) Accounts payable
90
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Item Closing Balance Opening Balance
Material payments 591,663,389.64 558,353,834.37
Project payments 437,029,205.69 328,569,617.62
Equipment payments 75,044,432.33 31,092,321.64
Others 53,804,055.62 1,856,153.90
Total 1,157,541,083.28 919,871,927.53
(2) Accounts payable with age over 1 year
Reason of unpaid or not
Name of company Closing Balance
carried forward
Shaanxi Changrun Environmental Engineering Co., Ltd. 5,207,759.44 Not due for payment
Haoxing Energy Investment (Beijing) Asset Management
4,878,499.00 Not due for payment
Co., Ltd.
Lixingkai (Beijing) Energy System Technology Co., Ltd. 4,772,705.82 Not due for payment
Wuhan Kaixing Economic Development Co., Ltd. 4,386,808.45 Not due for payment
Heilongjiang Longcold Technology Co., Ltd. 3,209,930.00 Not due for payment
Total 22,455,702.71
24. Contract Liabilities
Item Closing Balance Opening Balance
Received in advance due from
445,660,584.96 499,719,963.40
unrealized revenue
Total 445,660,584.96 499,719,963.40
Significant change on the book value
Item Change amount Change reason
According to the agreement,
Advance payment -54,059,378.44
advance payment for goods
Total -54,059,378.44
25. Employee’s payable
(1) Category of employee’s payable
Item Opening Increase Decrease Closing
Balance Balance
Short-term employee’s
35,148,570.37 141,270,325.52 167,621,861.96 8,797,033.93
payable
Post-employment benefit
212.11 16,040,552.59 15,730,920.12 309,844.58
–defined contribution plan
Termination benefits 188,952.39 188,952.39
Total 35,148,782.48 157,499,830.50 183,541,734.47 9,106,878.51
(2) Short-term employee’s payables
91
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Item Opening Balance Increase Decrease Closing Balance
Salaries, bonus,
allowance, and 31,199,563.29 111,873,626.70 136,828,539.75 6,244,650.24
subsidy
Welfare 1,849,331.65 6,663,733.51 7,298,948.77 1,214,116.39
Social insurance 305,854.01 11,001,269.00 11,298,118.34 9,004.67
Include: Medical
7,348,601.30 7,348,601.30
insurance
On-duty
injury 661.20 1,107,549.62 1,099,206.15 9,004.67
insurance
Maternity
942,078.31 942,078.31
insurance
Housing funds 9,275,257.05 9,312,894.12 -37,637.07
Labor union and
1,793,821.42 2,115,305.81 2,542,227.53 1,366,899.70
training expenses
Others 341,133.45 341,133.45
Total 35,148,570.37 141,270,325.52 167,621,861.96 8,797,033.93
(3) List of setting withdrawal plans
Item Opening Increase Decrease Closing
Balance Balance
Basic retirement insurance 15,696,918.47 15,400,264.71 296,653.76
Unemployment Insurance
212.11 343,634.12 330,655.41 13,190.82
Premium
Total 212.11 16,040,552.59 15,730,920.12 309,844.58
26. Tax payable
Item Closing Balance Opening Balance
Value-added tax 11,307,723.35 8,428,289.41
Enterprise income tax 15,283,505.24 825,185.23
Individual income tax 2,226,166.67 471,053.12
City maintenance and construction tax 1,095,832.62 178,955.65
Real estate tax 468,885.10 1,910,131.37
Land use tax 531,073.94 1,094,769.07
Stamp duty 646,889.47 477,653.78
Education surcharge 461,852.08 127,825.46
Green tax 1,039.65 984.73
Total 32,022,968.12 13,514,847.82
27. Other accounts payable
92
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Item Closing Balance Opening Balance
Dividend payable 10,765,281.07 3,008,156.00
Other accounts payable 36,914,318.16 52,275,984.21
Total 47,679,599.23 55,284,140.21
(1). Dividend payable
Item Closing Balance Opening Balance
Ordinary share dividend 10,765,281.07 3,008,156.00
Total 10,765,281.07 3,008,156.00
（2）Other accounts payable
Other payables categorized by payments nature
Payments nature Closing Balance Opening Balance
Deposit and security deposit 9,796,962.19 11,879,889.59
Reimbursed but not paid 7,770,141.86 10,784,375.08
Collection 7,288,574.15 2,449,487.90
Others 12,058,639.96 27,162,231.64
Total 36,914,318.16 52,275,984.21
28. Non-current liabilities due within one year
Item Closing Balance Opening Balance
Long-term payables due within one year 13,755,120.00 13,876,415.99
Lease liabilities due within one year 9,144,319.44 10,298,972.13
Total 22,899,439.44 24,175,388.12
29. Other current liabilities
Item Closing balance Opening balance
Notes payable endorsed not derecognized 153,147,054.19 143,288,366.08
Output Vat to be carried forward 48,181,226.13 51,924,840.83
Total 201,328,280.32 195,213,206.91
30. Long-term loan
(1) Category of long-term loan
Category Closing Balance Opening Balance
Guarantee loan 140,000,000.00 150,000,000.00
Total 140,000,000.00 150,000,000.00
31. Lease liabilities
Item Closing Balance Opening Balance
Lease liabilities 15,761,961.12 16,861,280.02
Less: Unrecognized financing
-986,540.20 -1,168,286.75
charges
Reclassified to non-current liabilities
-9,144,319.44 -10,298,972.13
due within one year
Total 5,631,101.48 5,394,021.14
93
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
32. Long term accounts payable
Item Closing Balance Opening Balance
Long term accounts payable 23,088,337.61 19,998,913.29
Total 23,088,337.61 19,998,913.29
(1) Category by nature
Item Closing Balance Opening Balance
Loans from financial leasing companies 23,088,337.61 19,998,913.29
33. Deferred income
(1) Category of deferred income
Item Opening Increase Decrease Format
Closing
Balance ion
Balance
Basis
Government
106,185,323.82 458,000.00 3,633,486.90 103,009,836.92
subsidy
Total 106,185,323.82 458,000.00 3,633,486.90 103,009,836.92 —
(2) Government subsidy project
Amount
Related
Opening Recorded into included Offset cost Other Closing with
Government
Increase
subsidy item Balance Non-operating in other or expense changes Balance asset/
income income equity
Asset
Relocation
38,990,000.00 556,998.00 38,433,002.00
compensation related
The Application
of Using NH3
and CO2 to
Replace the R22 Asset
Screw 22,505,971.44 999,766.56 2,150,620,488.00
related
Refrigerator
Combined
Compression
Condensing Unit
Refrigeration
Compressor Asset
Intelligent 3,538,360.27 184,384.86 3,353,975.41
related
Manufacturing
System Fund
94
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
Ultrasonic
intelligent Asset
3,421,177.42 15,000.00 192,412.20 3,213,765.22
defrosting related
technology
Environmental
protection and
energy-saving
refrigeration
and Asset
19,975,471.49 1,276,925.28 18,698,546.21
conditioning related
compressor
technology
industrialization
project
R290 replaces
R22 large Asset
13,006,663.20 13,006,663.20
industrial screw related
unit
R290 replaces
R22 in Asset
industrial 4,747,680.00 4,747,680.00
related
twin-stage
screw unit
Equity
High-tech
458,000.00 408,000.00 50,000.00
enterprises related
34. Share capital
Increase/decrease（+、-）
New
Opening Transfer Closing
Item share Share Subtotal
balance from capital others balance
issued dividend
reserve
Total
843,212,507.00 843,212,507.00
shares
35. Capital reserves
Items Opening Increase Decrease Closing Balance
Balance
Capital premium 669,193,413.27 669,193,413.27
95
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
(equity premium)
Other capital reserves 51,022,453.51 336,172.00 50,686,281.51
Total 720,215,866.78 336,172.00 719,879,694.78
96
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022 Semiannual Report
6. Other comprehensive income
2022.1-6
Less: included
in other
Less: included in comprehensive
Opening other comprehensive Closing
Items Amount before income in the After-tax
Balance income in the After-tax attribute Balance
income tax for previous Less： income attribute to
previous period and to the parent
the current period and tax expense minority
transferred to profit company
period transferred to shareholder
or loss in the current
period retained
earnings in the
current period
II.Other comprehensive income to be
2,178,681.73 2,178,681.73
reclassified to profit or loss
Including: other comprehensive income
that can be transferred to profit or loss 2,178,681.73 2,178,681.73
under the equity method
Other comprehensive income total 2,178,681.73 2,178,681.73
97
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
37. Surplus reserves
Item Opening Closing
Increase Decrease
Balance Balance
Statutory surplus reserve 347,216,790.47 347,216,790.47
Discretionary surplus reserve 462,254,409.17 462,254,409.17
Total 809,471,199.64 809,471,199.64
38. Undistributed profits
Item 2022-06-30 2021-06-30
Closing balance of 2021 627,764,582.32 997,601,577.97
Adjustment of the total amount of undistributed
profits at the beginning of the period (increase +, -79,559,636.71
decrease -)
Opening balance of 2022 627,764,582.32 918,041,941.26
Add: net profit attributable to shareholders of
29,568,351.52 -269,059,849.96
parent company in the year
Provision for any surplus reserves 12,785,383.91
Dividends payable for common shares 8,432,125.07 8,432,125.07
Closing balance of the current period 648,900,808.77 627,764,582.32
39. Operating revenue and cost
Items 2022.01-06 2021.01-06
Sales revenue Cost of sales Sales revenue Cost of sales
Revenue from
1,246,624,682.46 1,101,097,130.75 1,069,601,775.40 939,531,941.76
principle operation
Revenue from
45,234,226.25 30,818,078.34 24,683,845.57 10,872,827.50
other operation
Total 1,291,858,908.71 1,131,915,209.09 1,094,285,620.97 950,404,769.26
Income related information:
Items Division 1 Total
Classified at products type 1,246,624,682.46 1,246,624,682.46
Manufacture products 912,396,566.62 912,396,566.62
Installation work 328,784,059.27 328,784,059.27
Other products and service 5,444,056.57 5,444,056.57
Classified at geography location
domestic 1,169,857,130.73 1,169,857,130.73
76,767,551.73 76,767,551.73
40. Operating taxes and surcharges
98
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Items 2022.01-06 2021.01-06
City construction tax 1,300,268.55 1,446,546.32
Education surcharge 897,379.28 962,826.14
Resource tax
Property tax 4,341,262.13 4,035,908.73
Land use tax 2,192,079.15 2,450,307.46
Vehicle and vessel tax 4,923.36 8,942.04
Stamp duty 925,221.28 657,768.65
Others 130,238.28 119,222.81
Total 9,791,372.03 9,681,522.15
41. Selling expenses
Items 2022.01-06 2021.01-06
Employee's salary 36,733,989.97 33,826,230.13
Official business expense 2,682,974.83 4,348,750.49
Travel expense 3,786,682.25 4,114,863.50
Business entertaining expense 2,049,748.87 2,525,127.61
Maintenance and repair expense 6,395,816.83 2,873,319.38
Advertisement and bids expense 351,149.45 1,044,426.89
Depreciation expense 209,483.82 98,213.00
Transportation expense 1,311,116.86 6,509,108.10
Other expense 1,688,445.27 1,370,485.55
Total 55,209,408.15 56,710,524.65
42. Administrative expenses
Items 2022.01-06 2021.01-06
Employee benefit 42,406,947.67 44,697,319.27
Official expense 5,163,653.61 6,540,910.41
Depreciation expense 6,926,148.25 5,684,128.55
Long-term assets amortization 3,734,356.74 3,926,562.28
Maintenance and repair expense 2,564,900.40 2,769,914.26
Design consultant and test service expense 4,264,322.84 3,154,130.36
Safety production cost 864,579.34 1,201,021.67
Travel expense 1,593,342.93 1,783,780.25
Business entertaining expense 599,513.97 814,439.73
Insurance expense 426,810.11 364,092.63
Advertisement expense 57,277.06 66,647.41
Other tax 18,601.23
Other expense 1,472,302.79 704,949.73
Total 70,074,155.71 71,726,497.78
99
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
43. R&D expenses
Items 2022.01-06 2021.01-06
Employee benefit 25,441,289.49 28,422,612.24
Depreciation and amortization expense 705,540.38 441,407.58
Raw material 4,384,577.60 1,367,252.76
Entrust external R&D investment 227,644.82
Other expense 1,033,113.44 279,234.20
Total 31,564,520.91 30,738,151.60
44. Financial expenses
Items 2022.01-06 2021.01-06
Interest expenses 7,533,477.17 8,711,437.07
Less: Interest income 2,004,850.77 3,200,439.42
Add: Exchange loss -2,344,388.03 -471,153.98
Others expenditure 2,286,117.06 1,200,825.06
Total 5,470,355.43 6,240,668.73
45. Other income
Items 2022.01-06 2021.01-06
Government subsidy 741,847.00 907,398.00
Personal income tax handling fee refund 15,928.19 7,056.99
Stable job subsidy 98,244.00
Others 1,128,151.43
Total 1,984,170.62 914,454.99
46. Investment income
Items 2022.01-06 2021.01-06
Long-term equity investment income accounted for by the
16,955,402.09 21,085,751.39
equity method
Debt Restructuring Proceeds 2,834,620.63 -6,860.60
Investment income from disposal of other non-current
43,296,525.04 -96,737.66
financial assets
Investment income of other non-current financial assets
20,657,215.39 7,229,604.48
during the holding period
Total 83,743,763.15 28,211,757.61
47. Income from changes in fair value (loss listed as“-“)
100
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Items 2022.01-06 2021.01-06
Other non-current financial assets -29,425,921.52 -5,034,903.12
Total -29,425,921.52 -5,034,903.12
48. Credit impairment losses (loss listed as“-“)
Items 2022.01-06 2021.01-06
Bad debt losses of other receivables -451,293.97 2,435,152.34
Long-term receivables bad debt losses 280,800.00
Bad debt loss on notes receivable -369,641.88 1,108,930.41
Bad debt loss of accounts receivable -11,270,943.86 -11,460,308.47
Total -12,091,879.71 -7,635,425.72
49. Assets impairment losses (loss listed as“-“)
Items 2022.01-06 2021.01-06
Inventory depreciation loss and contract performance
782,759.18
cost impairment loss
Impairment loss of construction in progress -970,000.00
Impairment loss on contract assets -588,424.79 -1,016,603.72
Total -775,665.61 -1,016,603.72
50. Gain on assets disposal
Item 2022.01-06 2021.01-06
Gains on disposal of non-current assets 67,260.20 59,272.29
Including: gains on disposal of non-current assets not
67,260.20 59,272.29
classified as held for sale
Including: income from disposal of fixed assets 67,260.20 59,272.29
Total 67,260.20 59,272.29
51. Non-operating income
Amounts recognized into
Item 2022.01-06 2021.01-06 non-recurring profit or loss for
the year
Debt restructuring gains 369,165.58 531,903.00 369,165.58
Others 1,209,983.77 1,407,195.38 1,209,983.77
Quality compensation 31,535.00 31,535.00
Total 1,610,684.35 1,939,098.38 1,610,684.35
52. Non-operating expenses
101
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Amounts recognized into
Item 2022.01-06 2021.01-06 non-recurring profit or loss for the
year
Loss of non-current assets
23,028.50 395,122.52 23,028.50
damaged and scrapped
Estimated Loss from Pending
227,145.65 227,145.65
Litigation
Others 82,470.42 166,566.53 82,470.42
Total 332,644.57 561,689.05 332,644.57
53. Income tax expenses
(1) Income tax expenses
Items 2022.01-06 2021.01-06
Current income tax expenses 15,431,444.55 2,143,118.35
Deferred income tax expenses -12,657,290.56 371,879.14
Total 2,774,153.99 2,514,997.49
(2) Adjustment process of accounting profit and income tax expense
Items 2022.01-06
Total profits 32,613,654.30
Income tax expense at statutory/applicable rates 4,892,048.15
The impact of different tax rates applied to subsidiaries -2,141,757.75
Effects of non-deductible costs, expenses and losses 7,337,225.33
Effect of using deductible losses of deferred tax assets not
158,995.77
recognized in prior periods
Effect of deductible temporary differences or deductible losses of
-7,472,357.51
deferred tax assets not recognized in the current period
Income tax expenses 2,774,153.99
54. Other comprehensive income(Refer to the note VII.38 other comprehensive income for details)
55. Notes to cash flow statement
(1) Other cash received related to operating activities
Items 2022.01-06 2021.01-06
Government grants 383,420.00 1,367,721.83
Received travel expense refund 128,547.91 449,912.15
Deposit given back 12,691,025.06 27,180,320.58
Interest income 2,363,150.90 1,910,435.81
Others 11,561,311.72 3,356,161.51
Receivable from the related party 9,545,982.11
Total 52,310,721.23 43,810,533.99
102
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
(2) Other cash paid in connection with operating activities
Items 2022.01-06 2021.01-06
Business travel borrowing 3,338,694.72 5,217,215.20
Deposit paid 17,291,456.00 18,941,721.30
Expenditure 52,744,549.03 40,969,033.35
Pay related parties 3,074,818.29
Bank handling charges 2,105,772.59 1,155,480.12
Others 1,551,588.83 16,259,439.25
Total 77,032,061.17 85,617,707.51
(3) Other cash received in connection with fundraising activities
Items 2022.01-06 2021.01-06
At the end of the year, the deposit not used as
75,003,788.58 58,467,271.18
cash is due and recovered
Sale and leaseback financial lease sales 12,000,000.00 1,876,663.49
Other cash received in connection with
8,774,342.51
fundraising activities
Total 95,778,131.09 60,343,934.67
(4) Other cash paid in connection with fundraising activities
Items 2022.01-06 2021.01-06
At the end of the year, the deposit not used as
50,887,086.77 58,425,355.47
cash is due and recovered
Sale and leaseback financial lease sales 5,370,096.27 1,887,289.75
Total 56,257,183.04 60,312,645.22
56. Supplementary Information to the Statement of Cash Flows
(1)Supplementary Information to the Statement of Cash Flows
Items 2022.01-06 2021.01-06
1. Adjusting net profit into cash flows of operating
activities:
Net profit 29,839,500.31 -16,906,427.39
Add: Provision for impairment of assets 12,867,545.32 8,652,029.44
Depreciation of fixed assets, Amortization of mineral
36,744,922.14 34,378,919.44
resources, and biological assets
Depreciation of right of use assets 3,213,658.50 1,473,155.41
Amortization of intangible assets 4,663,658.96 3,356,402.92
Amortization of long-term deferred expenses 714,838.01 786,205.59
Losses on disposal of fixed assets, intangible assets, and
67,260.20 -8,393.93
long-term assets (income listed with”-”)
Losses on write-off of fixed assets (income listed with”-”) 23,028.50 395,122.52
103
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Change of fair value profit or loss 29,425,921.52 5,034,903.12
Financial expense (income listed with”-”) 7,533,477.17 8,711,437.07
Investment loss (income listed with”-”) -83,743,763.15 -28,211,757.61
Decrease of deferred tax assets(increase listed
-299,257.90 -854,627.34
with”-”)
Increase of deferred tax liabilities(decrease
-12,358,032.66 -755,235.46
listed with”-”)
Decrease of inventories (increase listed with”-”) -39,470,963.36 -125,888,007.53
Decrease of operating receivables (increase listed
-363,642,152.27 -152,568,485.04
with”-”)
Increase in operating payable items (decreases are listed with
185,105,808.47 233,516,922.51
"-")
Others
Net cash flows arising from operating activities -189,406,336.85 -28,887,836.28
2. Significant investment and financing activities
unrelated to cash income and expenses
Liabilities transferred to capital
Convertible bonds within 1 year 25,000,034.00
Financing leased fixed assets
3. Net increase (decrease) of cash and cash equivalent
Closing balance of cash 351,712,699.09 254,388,688.02
Less: Opening balance of cash 438,969,337.87 314,978,460.49
Add: Closing balance of cash equivalents
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents -87,256,638.78 -60,589,772.47
57. The assets with the ownership or use right restricted
Items 2022.6.30 Reasons
Monetary fund 50,887,086.77 Margin, bank account frozen funds
Notes Receivable 4,810,536.65 Pledge
Fixed assets 88,294,179.79 Mortgage
Intangible assets 6,209,834.23 Mortgage
Investment real estate 38,433,002.00 Mortgage
Total 188,634,639.44
Note: Dalian Bingshan Group Sales Co., Ltd., a subsidiary of the Company, has frozen funds of 5,434,895.32
Yuan in its bank deposit account due to litigation.
Dalian Universe Thermal Technology Co., Ltd., a subsidiary of the Company, pledged the bank acceptance
bill receivable to China Merchants Bank Co., Ltd. Dalian Branch as a deposit for issuing bank acceptance
bills.
104
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Dalian New Meica Electronic Technology Co., Ltd., a subsidiary of the company, pledged the bank
acceptance bill receivable to China Merchants Bank Co., Ltd. Dalian Jinpu New District Sub-branch as a
deposit for issuing bank acceptance bills.
Wuhan New World Refrigeration Industry Co., Ltd., a subsidiary of the company, pledged fixed assets,
intangible assets and investment real estate to Wuhan Branch of China Everbright Bank Co., Ltd. as a
comprehensive credit line for domestic and foreign currency loans, trade financing, discount, acceptance,
credit Specific credit business such as certificates, letters of guarantee, factoring, and guarantees.
58. Monetary category of foreign currency
(1) Monetary category of foreign currency
Item Closing Balance Exchange Closing Balance
(foreign currency) Rate (RMB)
Cash
Including：USD 525,170.11 6.7114 3,524,626.68
Euro
HKD
JPY 21,318,402.00 0.049136 1,047,501.00
Accounts receivable
Including: USD 5,341,761.14 6.7114 35,850,695.71
Euro
HKD
JPY 18,727,231.00 0.049136 920,181.22
VIII. Change of Consolidation Scope
1、Disposal of a subsidiary
Whether there is a situation in which the control right is lost after a single disposal of the investment in the
subsidiary
RYes No
105
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
The difference
between the
disposal price
and the share of
Determination the subsidiary's
Equity Equity Equity Point of
basis for the net assets at the
Company disposal disposal disposal loss of
point of loss of consolidated
price ratio method control
control financial
statement level
corresponding to
the disposal
investment
Bingshan Completion of
Technical industrial and
March
Service 25,888,200.00 100.00% Transferred commercial 3,864,200.00
1, 2022
(Dalian) Co., change
Ltd. registration
Ningbo
Bingshan Completion of
Refrigeration industrial and
June 9,
and Air 0.00 51.00% Transferred commercial 675,154.94
2022
Conditioning change
Engineering registration
Co., Ltd.
Whether there is a situation in which the investment in the subsidiary is disposed of in stages through
multiple transactions and the control is lost in the current period
Yes R No
IX. Interest in other entity
1. Equity of subsidiaries
(1) Organization structure of group company
Main Shareholding (%)
Registered Obtaining
Name of subsidiaries business Business nature
address Direct Indirect method
address
Dalian Bingshan Group
Dalian Dalian Installation 100 Establish
Engineering Co., Ltd.
Dalian Bingshan Group Sales
Dalian Dalian Trading 100 Establish
Co., Ltd.
Dalian Bingshan Air-conditioning Dalian Dalian Manufacturing 70 Establish
106
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Name of subsidiaries Main Registered Business nature Shareholding (%) Obtaining
business address method
Equipment Co., Ltd.
Dalian Bingshan Guardian
Dalian Dalian Manufacturing 100 Establish
Automation Co., Ltd.
Dalian Bingshan Ryosetsu Quick
Dalian Dalian Manufacturing 100 Establish
Freezing Equipment Co., Ltd.
Dalian New Meica Electronics
Dalian Dalian Electronic 100 Acquisition
Technology Co., Ltd
Dalian Nevis Cooling and Heating
Dalian Dalian Manufacturing 55 Acquisition
Technology Co., Ltd.
Dalian Bingshan International
Dalian Dalian Services 100 Acquisition
Trade Co., Ltd.
Wuhan New World Refrigeration
Wuhan Wuhan Manufacturing 100 Acquisition
Industry Co., Ltd.
Wuhan New World Refrigeration
and Air Conditioning Engineering Wuhan Wuhan Install 100 Establish
Co., Ltd.
Wuhan Lanning Energy 54.55
Wuhan Wuhan Trading Acquisition
Technology Co., Ltd.
Chengdu Bingshan Refrigeration
Chengdu Chengdu Services 51.00 Establish
Engineering Co., Ltd.
1) The company's shareholding ratio in subsidiaries is consistent with the voting rights ratio;
2) The company holds more than half of the voting rights in its subsidiaries;
3) The company holds more than half of the voting rights in its subsidiaries and can control the invested
units.
2. Equity in joint venture arrangement or associated enterprise
(1) The important of joint ventures or affiliated companies
Shareholding
(%)
Main
Name of joint ventures or Registered Business Accounting
business
affiliated companies address nature methods
address
Direct Indirect
Equity
Panasonic Compressor Dalian Dalian Manufacturing 40
method
107
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Shareholding
(%)
Main
Name of joint ventures or Registered Business Accounting
business
affiliated companies address nature methods
address
Direct Indirect
Equity
Jing Xue Insulation Changzhou Changzhou Manufacturing 21.91
method
Equity
Bingshan Metal Technology Dalian Dalian Manufacturing 49
method
The investment income from the investee recognized by the company this year accounted for 10% of the net profit
attributable to the owner of the parent company or the company's share of the net assets of the investee calculated
according to the shareholding ratio accounted for attributable to the parent company at the end of the year. Associates
with more than 10% of shareholders' equity are significant associates.
1) The shareholding ratio of the company in the joint venture is the same as the voting rights ratio;
2) The company does not have an associated enterprise that holds less than 20% of the voting rights but has
significant influence;
3) The company has no associates that hold 20% or more of the voting rights but do not have significant
influence.
（2） The key financial information of affiliated companies
108
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
30-06-2022/2022.01-06
Items Panasonic Jing Xue Bingshan Metal
Compressor Insulation Technology
Current assets 1,190,712,160.57 1,321,264,561.19 354,531,888.69
Non-current
assets 299,425,380.33 266,328,229.90 36,660,268.44
Total assets 1,490,137,540.90 1,587,592,791.09 391,192,157.13
Current
liabilities 349,314,421.18 776,901,404.57 57,251,169.54
Non-current
liabilities 26,066,950.91 32,963,341.25
Total liabilities 375,381,372.09 809,864,745.82 57,251,169.54
Minority
interests 451,122.19
Equity to the
parent 1,114,756,168.81 777,276,923.08 333,940,987.59
company
Proportions of
net assets
according to
the 445,902,467.52 170,287,246.68 163,631,083.91
shareholding
percentage
Adjusting
events
—Goodwill 29,961,491.06 19,269,770.94
—Unrealized
profits of
insider trading
--Others -1,549,763.76
Book value of
equity
investment of 444,352,703.77 200,248,737.74 182,900,854.85
affiliated
companies
Fair value of
equity
investment of
affiliated
companies
Operating
586,769,217.28 274,830,181.17 240,379,163.49
income
Net profit 48,430,117.37 14,233,453.36 29,807,983.52
Net profit from
closing
Other
comprehensive
income
Total
48,430,117.37 14,233,453.36 29,807,983.52
comprehensive
109
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
30-06-2022/2022.01-06
Items Panasonic Jing Xue Bingshan Metal
Compressor Insulation Technology
income
The current
dividends
34,122,000.00
received from
joint ventures
Continued：
31-12-2021/2021.01-06
Items Panasonic Jing Xue Bingshan Metal
Compressor Insulation Technology
Current assets 1,277,834,286.47 1,288,722,048.45 330,379,711.49
Non-current
307,229,051.83 235,300,482.93 39,596,544.29
assets
Total assets 1,585,063,338.30 1,524,022,531.38 369,976,255.78
Current
396,672,114.65 709,690,258.17 65,843,251.71
liabilities
Non-current
29,936,172.21 29,832,096.59
liabilities
Total liabilities 426,608,286.86 739,522,354.76 65,843,251.71
Minority
484,306.52
interests
Equity to the
1,156,846,384.28 784,015,870.10 304,133,004.07
parent company
Net assets
calculated
according to the 462,738,553.71 171,770,036.98 149,025,171.99
shareholding
proportions
Adjusting
events
—Goodwill 29,961,491.06 19,269,770.94
—Unrealized
profits of insider
trading
--Others -2,678,304.22
Book value of
equity
investment of 460,060,249.49 201,731,528.04 168,294,942.93
affiliated
companies
Fair value of
equity
investment of
affiliated
companies
Operating 579,289,602.09 277,028,549.54 231,889,705.55
110
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
31-12-2021/2021.01-06
Items Panasonic Jing Xue Bingshan Metal
Compressor Insulation Technology
income
Net profit 66,514,772.97 16,637,748.36 23,361,750.71
Net profit from
closing
Other
comprehensive
income
Total
comprehensive 66,514,772.97 16,637,748.36 23,361,750.71
income
The current
dividends
32,773,200.00 28,648,633.78
received from
joint ventures
111
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
(3) Summary financial information of insignificant affiliated companies
Items 30-06-2022/2022.01-06 31-12-2021/2021.01-06
Associates:
Total book value of investments 307,002,623.96 158,059,185.33
The total number of the following items based on
shareholding ratio
Net profit 11,494,152.42 2,067,871.70
Total comprehensive income 11,494,152.42 2,067,871.70
IX. Risk Related to Financial Instruments
一、Risks associated with financial instruments
The main financial instruments of the Company include borrowings, accounts receivable, accounts
payable, other non-current financial assets, etc. Please refer to Note VI for the detailed description of each
financial instrument. The risks associated with these financial instruments and the risk management policies
adopted by the Company to reduce these risks are described below. The management of the company
manages and monitors these risk exposures to ensure that the above risks are controlled within a limited
range.
1. Various risk management objectives and policies
The company's goal in risk management is to achieve an appropriate balance between risks and benefits,
minimize the negative impact of risks on the company's operating performance, and maximize the interests
of shareholders and other equity investors. Based on this risk management objective, the basic strategy of the
company's risk management is to identify and analyze the various risks faced by the company, establish an
appropriate risk tolerance bottom line and carry out risk management, and monitor various risks in a timely
and reliable manner. controlled within a limited range.
(1) Market risk
1.The main business of the company is located in China, and the main business is settled in RMB. However,
the foreign currency assets and liabilities recognized by the company and future foreign currency
transactions (foreign currency assets and liabilities and foreign currency transactions are mainly denominated
in USD, JPY, EUR, HKD and GBP) still have foreign exchange risks. The company's financial department is
responsible for monitoring the company's foreign currency transactions and the scale of foreign currency
assets and liabilities to minimize foreign exchange risks. The company did not sign any forward foreign
exchange contracts or currency swap contracts during the year. As of June 30, 2022, the foreign currency
financial assets and foreign currency financial liabilities held by the company converted into RMB are listed
as follows:
112
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Items Closing Balance Opening balance
Monetary fund-USD 3,524,626.68 7,966,454.17
Monetary fund-JPY 1,047,501.00 152,139.56
Monetary fund-EURO 6,048.12
Monetary fund- GBP 62,609.89
Receivable - GBP 1,332,493.86
Receivable- USD 35,850,695.71 35,847,300.59
Receivable - EURO
920,181.22
Receivable - JPY
5,414,277.32 6,120,681.44
Payables -USD
Payables -EURO 141,791.17
1,938,707.73 705,557.54
Payables - JPY
Payables -GBP 334,163.44
The Company paid close attention to the effect on FX risk.
2) Interest rate risk
The company's interest rate risk mainly arises from bank borrowings. Financial liabilities with floating interest rates
expose the Company to cash flow interest rate risk, while financial liabilities with fixed interest rates expose the
Company to fair value interest rate risk. The company determines the relative proportion of fixed-rate and
floating-rate contracts based on the prevailing market conditions. The company borrowed a long-term loan of RMB
140 million from the controlling shareholder Dalian Bingshan Group Co., Ltd. at a fixed interest rate.
The company's finance department continuously monitors the company's interest rate levels. Rising interest
rates will increase the cost of new interest-bearing debt and the company's unpaid interest on floating-rate
interest-bearing debt, and adversely affect the company's financial performance. The management will make
timely adjustments based on the latest market conditions. Adjustments to reduce interest rate risk.
The sensitive analysis：
As of June 30, 2022, if the borrowing rate were to rise or fall by 50 basis points, while other factors remained
constant, the company's net profit would decrease or increase by approximately RMB 1.9 million.
3) Price risk
The price risk faced by the Company is mainly commodity price risk. The company sells products at
market prices. As the national economy enters the "new normal", the manufacturing industry is under greater
economic downward pressure, and the sharp fluctuations in the prices of bulk materials have a certain impact
on the company's operations.
(2)Credit risk
The company's credit risk mainly comes from monetary funds, notes receivable, accounts receivable, and
113
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
other receivables. Management has established appropriate credit policies and continuously monitors
exposure to these credit risks.
The monetary funds held by the company are mainly deposited in financial institutions such as commercial
banks. The management believes that these commercial banks have high reputation and asset status and have
low credit risk. The company adopts a limit policy to avoid credit risk to any financial institution.
For accounts receivable, other receivables and notes receivable, the company sets relevant policies to control
credit risk exposure. The company evaluates the customer's credit qualification and sets the corresponding
credit period based on the customer's financial situation, the possibility of obtaining guarantees from third
parties, credit history and other factors such as current market conditions. The company will regularly
monitor the credit records of customers. For customers with bad credit records, the company will use written
reminders, shorten the credit period or cancel the credit period, etc., to ensure that the company's overall
credit risk is within a controllable range.
As of June 30, 2022, the total amount of the top five accounts receivable of the company: 176,316,539.33
yuan.
(3) Liquidity risk
Liquidity risk is the risk that the company will not be able to meet its financial obligations on the due date. The
Company's approach to managing liquidity risk is to ensure that there is sufficient liquidity to meet obligations when
they fall due without causing unacceptable losses or damage to corporate reputation. The company regularly analyzes
the liability structure and term to ensure sufficient funds. The management of the Company monitors the use of bank
borrowings and ensures compliance with loan agreements. At the same time, it conducts financing consultations with
financial institutions to maintain a certain credit line and reduce liquidity risks.
The Company uses bank borrowings as its main source of funds. As of June 30, 2022, the Company's unused bank
borrowings amounted to RMB 700 million, of which the Company's unused short-term bank borrowings amounted to
RMB 700 million.
The financial assets and financial liabilities held by the Company are analyzed according to the maturity period of the
undiscounted remaining contractual obligations as follows:
Closing balance
Within 1 1-2 2-5 Over 5
Items Total
year years years years
Financial Assets
Cash and cash in bank 40,266.20 40,266.20
Notes receivable 18,195.51 18,195.51
Accounts receivable 98,200.87 98,200.87
114
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Closing balance
Within 1 1-2 2-5 Over 5
Items Total
year years years years
Receivables financing 2,473.75 2,473.75
Other receivable 18,293.99 18,293.99
Contract asset 12,616.44 12,616.44
Non-current assets maturing within one
1,499.10 1,499.10
year
Other non-current financial assets 16,751.60 16,751.60
Financial Liabilities 0 -
Short-term loan 24,000.00 24,000.00
Notes Payable 32,067.76 32,067.76
Accounts payable 115,754.11 115,754.11
Other payable 4,767.96 4,767.96
Employee’s payable 910.69 910.69
Tax payable 910.69 910.69
Non-current liabilities due within one
2,289.94 2,289.94
year
Long-term loan 14000 14,000.00
Lease liability 23.71 333.39 169.12 36.89 563.11
Long-term payables 308.94 1,999.89 2,308.83
XI. Disclosure of Fair Value
1. Closing fair value of assets and liabilities measured at fair value
Fair value at the year end
Items First level Second level Third level
measurement of fair measurement of measurement Total
value fair value of fair value
Financial assets Continuously
-- -- -- --
measured at FV available for sale
Receivables Financing 24,737,543.92 24,737,543.92
Other non-current financial assets 165,832,121.60 1,683,852.59 167,515,974.19
Non-continuous fair value
-- -- -- --
measurement
2. Determination basis for the market price of continuous and non-continuous first-level fair value
measurement items
The company's investment in some equity instruments in other non-current financial assets is the unadjusted
closing price on the stock public trading market on June 30, 2022.
115
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
3. Continuing and non-continuing Level 2 fair value measurement items, valuation techniques used and
qualitative and quantitative information on important parameters
The financial instruments included in the second level of fair value measurement by the company are the
bank acceptance bills (accounts receivable financing) held at fair value and whose changes are included
in other comprehensive income. They are mainly large commercial banks with high credit ratings. Due to
the short remaining maturity period and extremely low credit risk, the book value of bank acceptance
bills receivable is close to the fair value on the balance sheet date.
4. Continuing and non-continuing Level 3 fair value measurement items, the valuation techniques used
and qualitative and quantitative information on important parameters
Continuous and non-continuous third-level fair value measurement items are mainly equity investments
in unlisted companies held by the company. There is no active market for the equity of the investee
involved, and there is no market transaction price for reference. The relevant observable input If it is not
practical to obtain the value, the company uses the third-level input value, that is, the unobservable input
value. The fair value measurement mainly adopts the price-to-book ratio method of comparable
companies, and considers the liquidity discount.
5. Continuous third-level fair value measurement items, adjustment information between the opening
and closing book values and sensitivity analysis of unobservable parameters
Continued third-level fair value measurement items, reconciliation information between the book value
at the beginning of the year and the end of the year, and sensitivity analysis of unobservable parameters
6. Continued fair value measurement items, if there is a transfer between different levels in the current
period, the reason for the transfer and the policy for determining the time point of the transfer
None
7. Changes in valuation techniques during the period and reasons for the changes
None
8. Fair value of financial assets and financial liabilities not measured at fair value
None
116
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
XII. Related Parties Relationship and Transactions
1. The parent company of the company
Parent company Registered Business Registered Shareholding Voting power
address nature capital percentage (%) percentage
(%)
Dalian Bingshan
Dalian Manufacture 158,580,000.00 20.27 20.27
Group Co., Ltd.
The registered address of Dalian Bingshan Group Co., Ltd. is located at No. 106, Liaohe East Road, Dalian
Economic and Technological Development Zone. It is a Sino-foreign joint venture limited liability company.
Its legal representative is Ji Zhijian. July 2nd. The company's business scope: research, development,
manufacturing, sales, service and installation of products in the fields of industrial refrigeration products,
refrigeration and refrigeration products, large, medium and small air-conditioning products, petrochemical
equipment products, electronic and electronic control products, household appliances products,
environmental protection equipment products (involving Administrative licenses must be operated with a
license).
l Registered capital of controlling shareholder and its changes
Controlling Initial balance Increase decrease end of year
shareholder balance
Dalian Bingshan
158,580,000.00 - - 158,580,000.00
Group Co., Ltd.
l Controlling shareholders' holdings or interests and their changes
Controlling Shareholding amount Shareholding ratio (%)
shareholder End of year Initial balance Year-end ratio Ratio at the
balance beginning of the
year
Dalian Bingshan
Group Co., Ltd. 170,916,934.00 170,916,934.00 20.27 20.27
2. Subsidiaries
117
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Please refer to Note IX, 1. (1) Composition of the enterprise group for the details of the subsidiaries of the
Company.
3. Affiliated company and joint venture
For the important joint ventures or associates of the company, please refer to Note IX. 3. (1) Important
associates.
Other joint ventures or associates that have related party transactions with the company in the current period,
or have related party transactions with the company in the previous period and formed a balance are as
follows:
Names of the joint ventures or affiliated company Relationships with the Company
Panasonic Cold Chain (Dalian) Co., Ltd. Affiliated company of the Company
Panasonic Compressor (Dalian) Co., Ltd. Affiliated company of the Company
Dalian Benzhuang Chemical Co., Ltd. Affiliated company of the Company
Songzhi Dayang Cooling and Heating Technology (Dalian)
Affiliated company of the Company
Co., Ltd.
Beijing Huashang Bingshan Refrigeration and Air
Affiliated company of the Company
Conditioning Equipment Co., Ltd.
Dalian Fuji Bingshan Vending Machine Co., Ltd. Affiliated company of the Company
Lingzhong Bingshan Refrigeration (Dalian) Co., Ltd. Affiliated company of the Company
Dalian Fuji Bingshan Vending Machine Sales Co., Ltd. Affiliated company of the Company
Jiangsu Jingxue Energy Saving Technology Co., Ltd. Affiliated company of the Company
Dalian Jingxue Energy Saving Technology Co., Ltd. Subsidiaries of the Company's Associates
Shanghai Jingxue Energy Saving Technology Co., Ltd. Subsidiaries of the Company's Associates
Panasonic Refrigeration System (Dalian) Co., Ltd. Affiliated company of the Company
Dalian Bingshan Metal Technology Co., Ltd. Affiliated company of the Company
Dalian Bingshan Group Huahuida Financial Leasing Co.,
Affiliated company of the Company
Ltd.
The Company's wholly-owned subsidiary
Wuhan Scaf Power Control Equipment Co., Ltd.
associates
4. Other related parties
Name of related party Related party relationship
Affiliated company of Dalian Bingshan
Dalian Spindle Environmental Facilities Co., Ltd.
Group
Affiliated company of Dalian Bingshan
BAC Dalian Co., Ltd.
Group
Linde Hydrogen Refueling Station Equipment (Dalian) Co., Affiliated company of Dalian Bingshan
Ltd. Group
Dalian Bingshan Pat Technology Co., Ltd. Subsidiary of Dalian Bingshan Group
118
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Bingshan Songyang Biotechnology (Dalian) Co., Ltd. Subsidiary of Dalian Bingshan Group
Bingshan Technical Service (Dalian) Co., Ltd. Subsidiary of Dalian Bingshan Group
Affiliated company of Subsidiary of
Dalian Fuji Bingshan Intelligent Control System Co., Ltd.
Dalian Bingshan Group
Dalian Kelvin Technology Co., Ltd. Subsidiary of Dalian Bingshan Group
Dalian Bingshan Huigu Development Co., Ltd. Subsidiary of Dalian Bingshan Group
5. Related Party transactions
1. Purchase of goods, offer and receive labour services etc inter-group transactions
1) Purchase of goods/receive labour services
Content 2022.1-6 Approved Whether 2021.1-6
Transaction the
Limit transacti
Related party on limit
is
exceede
d
Panasonic Refrigeration (Dalian) Co., Ltd. 15,000,000.00 No 14,283,046.33
BAC Dalian Co., Ltd. 21,233,858.40 45,000,000.00 No 14,119,984.98
Panasonic Cold Chain (Dalian) Co., Ltd. 2,058,376.71 15,000,000.00 No 4,418,110.43
Jiangsu Jingxue Energy Saving Technology
364,716.81 35,000,000.00 No 15,144,300.86
Co., Ltd.
Bingshan Technical Service (Dalian) Co.,
1,253,534.59 40,000,000.00 No
Ltd.
Dalian Bingshan Huigu Development Co.,
147,219.63 1,000,000.00 No
Ltd.
Dalian Bingshan Pat Technology Co., Ltd. 2,981,051.00 11,000,000.00 No 1,100,719.55
Dalian Spinde Environmental Equipment
815,097.34 8,000,000.00 No 562,428.33
Co., Ltd.
Panasonic Compressor (Dalian) Co., Ltd. 2,352,071.11 3,000,000.00 No 1,913,993.12
Dalian Bingshan Metal Technology Co.,
28,460.16 500,000.00 No
Ltd.
Dalian Fuji Bingshan Vending Machine
1,003,270.93 5,500,000.00 No 1,351,425.38
Co., Ltd.
Dalian Fuji Bingshan Vending Machine
16,814.16 500,000.00 No 330,309.73
Sales Co., Ltd.
Dalian Bingshan Group Huahuida
330.19 50,000,000.00 No 476,917.71
Financial Leasing Co., Ltd.
Dalian Bingshan Group Co., Ltd. 4,528.30 500,000.00 No
Songyang Biotechnology Co., Ltd. 933,799.10 500,000.00 No
Beijing Huashang Bingshan Refrigeration
500,000.00 No
and Air Conditioning Equipment Co., Ltd.
Dalian Kelvin Technology Co., Ltd. 500,000.00 No
Dalian Fuji Bingshan Intelligent Control
1,000,000.00 No
System Co., Ltd.
Total 65,488,523.25 85,511,898.87
2) Sales of goods/ labour services provision
119
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Conte 2022.1-6 2021.1-6
Related party
nt
Panasonic Cold Chain (Dalian) Co., Ltd. 66,262,077.88 71,690,961.56
Dalian Fuji Bingshan Vending Machine Co., Ltd. 14,518,618.12 8,397,453.07
Panasonic Refrigeration System (Dalian) Co., Ltd. 11,925,729.23 19,990,779.80
Lingzhong Bingshan Refrigeration (Dalian) Co., Ltd. 5,075,605.89 12,830,587.15
Panasonic Compressor (Dalian) Co., Ltd. 26,604,561.52 7,600,809.54
Dalian Bingshan Pat Technology Co., Ltd. 624,768.48 143,269.75
Songzhi Dayang Cooling and Heating Technology (Dalian) Co.,
0.00 0.00
Ltd.
Dalian Fuji Bingshan Vending Machine Sales Co., Ltd. 0.00 31,989.61
Jiangsu Jingxue Energy Saving Technology Co., Ltd. 3,035,091.30 0.00
BAC Dalian Co., Ltd. Sales 21,364,166.08 17,129,169.19
Bingshan Technical Service (Dalian) Co., Ltd. of 19,222,103.24
Dalian Bingshan Huigu Development Co., Ltd. goods 4,003,216.37 4,281,358.92
Dalian Bingshan Group Huahuida Financial Leasing Co., Ltd. 8,700,007.96 0.00
Dalian Spinde Environmental Equipment Co., Ltd. 2,315,455.64 3,073,360.72
Wuhan Scaf Power Control Equipment Co., Ltd. 256,431.86
Dalian Fuji Bingshan Intelligent Control System Co., Ltd. 305,206.80
Dalian Benzhuang Chemical Co., Ltd. 91,981.13
Songyang Biotechnology (Dalian) Co., Ltd. 7,771,926.75 1,290,650.45
Linde Hydrogen Refueling Station Equipment (Dalian) Co., Ltd. 5,095,635.29
Dalian Bingshan Group Refrigeration Equipment Co., Ltd. 2,498,729.42
Dalian Fuji Bingshan Intelligent Control System Co., Ltd. 285,694.57
Total 197,172,583.54 184,774,478.17
(2)Assets Lease
Assets rent out
Category of assets 2022.1-6 Lease 2021.1-6 Lease
Lessee
rent out Income Income
Dalian Bingshan Group Co., Ltd. Office 66,055.05
Lingzhong Bingshan
Factory 1,904,761.90 1,904,761.90
Refrigeration (Dalian) Co., Ltd.
Dalian Bingshan Huigu
Land, house 4,095,151.07 4,095,276.18
Development Co., Ltd.
Panasonic Cold Chain (Dalian)
Staff domitory 18,788.99
Co., Ltd.
Panasonic Compressor (Dalian)
Staff domitory 45,714.28 22,857.14
Co., Ltd.
Dalian Jingxue Energy Saving Factory, office 502,555.72 502,555.72
120
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Category of assets 2022.1-6 Lease 2021.1-6 Lease
Lessee
rent out Income Income
Technology Co., Ltd.
Wuhan Skafe Power Equipment
Factory 330,415.59 97,732.86
Control Co., Ltd.
Linde Hydrogen Refueling
Station Equipment (Dalian) Co., Land, house 1,961,055.05
Ltd.
Description of related leases
Category of assets rent Current year Last year Lease
Lessor
in Lease fees fees
Dalian Bingshan Group Huahuida
FA 10,971,589.76 397,771.84
Financial Leasing Co.
(3) Related guarantees.
CDB Development Fund supports the company's cold chain green intelligent equipment and service
industrialization base project, and provides special funds to the company's controlling shareholder, Bingshan
Group. For details, see "VII. 33 Long-term Loans".
(4) Funds borrow from /lent to related party
Name of the related party Amount Starting date Ending date Explanation
Project fund
Dalian Bingshan Group Co., Ltd. 140,000,000.00 2016.03.14 2026.03.13 investment
Dalian Bingshan Group Huahuida
Financial Leasing Co., Ltd. 1,348.67 2022.04.28 2023.04.27
Dalian Bingshan Group Huahuida
Financial Leasing Co., Ltd. 600,000.00 2022.05.20 2023.05.19
Dalian Bingshan Group Huahuida
Financial Leasing Co., Ltd. 5,481,000.00 2022.06.20 2024.06.19
Dalian Bingshan Group Huahuida
Financial Leasing Co., Ltd. 12,000,000.00 2022.01.07 2025.01.06
6. Receivables and payables of related parties
(1) Receivables
121
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Closing Balance Opening Balance
Item Related party Book Bad debt Book Bad debt
Balance Provision Balance Provision
Accounts BAC Dalian Co.,
Ltd. 13,358,280.43 937,751.29 12,548,585.90 880,910.73
receivable
Beijing Huashang
Bingshan
Accounts Refrigeration and
Air Conditioning 8,225,260.53 4,210,824.22 10,125,260.53 6,110,824.22
receivable
Equipment Co.,
Ltd.
Bingshan
Accounts Songyang
Biotechnology 4,389,586.01 308,148.94 1,164,159.66 81,724.01
receivable
(Dalian) Co., Ltd.
Accounts Dalian Fuji
Bingshan Vending 10,805,596.11 839,529.71 5,656,023.33 398,096.17
receivable Machine Co., Ltd.
Dalian Bingshan
Accounts Huigu
Development Co., 1,232,268.00 97,126.06 439,268.00 63,813.46
receivable
Ltd.
Dalian Spinde
Accounts Environmental
Equipment Co., 1,140,050.76 94,473.19 1,942,559.40 136,367.67
receivable
Ltd.
Lingzhong
Accounts Bingshan
Refrigeration 2,814,406.81 197,571.36 1,803,184.94 126,583.58
receivable
(Dalian) Co., Ltd.
Panasonic
Accounts Refrigeration
System (Dalian) 7,689,479.92 539,801.49 4,963,341.40 348,426.57
receivable
Co., Ltd.
Accounts Panasonic Cold
Chain (Dalian) 38,098,054.10 2,674,483.40 37,390,849.92 2,624,837.66
receivable Co., Ltd.
Accounts Panasonic
Compressor 4,072,906.71 285,918.05 4,021,698.75 282,323.25
receivable (Dalian) Co., Ltd.
Dalian Fuji
Accounts Bingshan
Intelligent Control 405,200.00 40,614.48 175,200.00 12,299.04
receivable
System Co., Ltd.
Accounts Bingshan
Technical Service 14,341,077.49 1,032,307.24
receivable (Dalian) Co., Ltd.
Dalian Dabing
Contract Refrigeration
Equipment Co., 75,000.00 12,555.00
assets
Ltd.
Panasonic
Contract Refrigeration
assets System (Dalian) 166,000.00 27,788.40
Co., Ltd.
122
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Panasonic
Refrigeration
Prepayment 223,101.70 2,225,656.57
System (Dalian)
Co., Ltd.
Dalian Bingshan
Prepayment 49,600.00
Group Co., Ltd.
Dalian Spinde
Environmental
Prepayment 36,455.00 341,215.00
Equipment Co.,
Ltd.
Dalian Bingshan
Group Huahuida
Prepayment 618,163.06 951,659.80
Financial Leasing
Co., Ltd.
BAC Dalian Co.,
Prepayment 1,003,142.00 1,607,378.00
Ltd.
Dalian Bingshan
Prepayment Technical Service 183,292.00
Co., Ltd.
Dalian Dabing
Refrigeration
Prepayment 157,531.70
Equipment Co.,
Ltd.
Panasonic
Receivable Refrigeration
financing System (Dalian) 148,563.00 4,197,610.38
Co., Ltd.
Panasonic Cold
Receivable
Chain (Dalian) 659,308.15 18,720,000.00
financing
Co., Ltd.
Receivable BAC Dalian Co.,
financing Ltd. 19,659,614.15 7,341,688.27
Dalian Fuji
Receivable
Bingshan Vending 2,060,929.41
financing
Machine Co., Ltd.
Dalian Bingshan
Other Group Huahuida
Financial Leasing 1,348.67 56.24
receivable
Co., Ltd.
Other Bingshan
Technical Service 100,000.00 69,460.00
receivable (Dalian) Co., Ltd.
Other Wuhan Scaf Power
Control Equipment 148,423.28 6,189.25
receivable Co., Ltd.
Other Panasonic Cold
Chain (Dalian) 18,079.63 753.92
receivable Co., Ltd.
(2) Accounts Payable due from Related Party
Item Related party Closing Balance Opening Balance
Accounts Payable BAC Dalian Co., Ltd. 24,745,595.67 11,326,144.36
Dalian Bingshan Pat Technology Co.,
Accounts Payable 2,189,826.04 3,921,294.33
Ltd.
Dalian Spinde Environmental
Accounts Payable 1,507,515.00 1,160,849.00
Equipment Co., Ltd.
123
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Jiangsu Jingxue Energy Saving
Accounts Payable 947,328.00 4,512,235.92
Technology Co., Ltd.
Dalian Fuji Bingshan Vending
Accounts Payable 0.00 145,500.00
Machine Sales Co., Ltd.
Panasonic Refrigeration System
Accounts Payable 27,108,641.54 17,401,521.28
(Dalian) Co., Ltd.
Panasonic Cold Chain (Dalian) Co.,
Accounts Payable 319,317.09 187,071.99
Ltd.
Panasonic Compressor (Dalian) Co.,
Accounts Payable 151,222.04 1,785,651.94
Ltd.
Dalian Bingshan Metal Technology
Accounts Payable 32,173.27 70,047.29
Co., Ltd.
Accounts Payable Dalian Kelvin Technology Co., Ltd. 173,125.00 128,750.00
Bingshan Technical Service (Dalian)
Accounts Payable 120,562.40
Co., Ltd.
Other accounts Dalian Bingshan Group Huahuida
payable Financial Leasing Co., Ltd. 576,142.31
Other accounts Dalian Fuji Bingshan Vending
payable Machine Sales Co., Ltd. 268,500.00
Other accounts Lingzhong Bingshan Refrigeration
payable (Dalian) Co., Ltd. 170,000.00
Other accounts Jiangsu Jingxue Energy Saving
payable Technology Co., Ltd. 70,000.00 70,000.00
Other accounts Bingshan Technical Service (Dalian)
payable Co., Ltd. 1,301.13
Panasonic Refrigeration System
Contract liability 1,410,975.05
(Dalian) Co., Ltd.
Panasonic Refrigeration System
Contract liability 1,819,735.06
(Dalian) Co., Ltd.
Wuhan Scaf Power Control Equipment
Contract liability 76,228.67
Co., Ltd.
Notes Payable BAC Dalian Co., Ltd. 7,770,000.00 3,932,858.40
Notes Payable Dalian Benzhuang Chemical Co., Ltd. 172,800.00
Dalian Bingshan Pat Technology Co.,
Notes Payable 900,000.00 880,000.00
Ltd.
Jiangsu Jingxue Energy Saving
Notes Payable 66,600.00 492,450.00
Technology Co., Ltd.
Panasonic Cold Chain (Dalian) Co.,
Notes Payable 1,657,321.00 1,657,321.00
Ltd.
Dalian Spinde Environmental
Notes Payable 1,307,900.00 1,517,200.00
Equipment Co., Ltd.
Panasonic Refrigeration System
Notes Payable 1,594,169.08
(Dalian) Co., Ltd.
Dalian Bingshan Group Huahuida
Lease liability 6,393,153.42 4,055,686.70
Financial Leasing Co., Ltd.
Non-current Dalian Bingshan Group Huahuida
liabilities due Financial Leasing Co., Ltd. 20,278,311.26 25,727,284.78
within one year
Long-term Dalian Bingshan Group Huahuida
payables Financial Leasing Co., Ltd. 3,246,400.10 23,543,375.62
(I) Related Party Commitment
None
124
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
XIII. Commitments and Contingencies
1. Important Commitments
As of June 30, 2022, the company has no commitments that need to be disclosed.
2. Contingencies
(1) As of June 30, 2022, the guarantee obligations undertaken by the company's financial leasing.
The company sells cold storage equipment to Guizhou Waterfall Cold Chain Food Investment Co., Ltd.
("Waterfall Cold Chain") in the form of financial leasing. The three parties sign a purchase contract and a financial
lease contract. The company is the seller and Huahuida is the buyer. and the lessor, Waterfall Cold Chain is the
lessee, and the total contract price is RMB 25.705 million. If the lessee delays in paying the rent, the company
shall assume the responsibility for advance rent payment and repurchase. The shareholders of Waterfall Cold
Chain issued an unconditional and irrevocable counter-guarantee with the company as the beneficiary to the
company. The scope of guarantee is based on all the debts guaranteed by the company for the financial lease sales
business.
As of June 30, 2022, the balance of the company's financial leasing guarantee obligations was 24,210,316.00 yuan,
and there was no situation where the company was required to assume the guarantee responsibility due to the
default of waterfall cold chain.
As of June 30, 2022, except for the above-mentioned matters, the Company has no material contingent events that
need to be disclosed.
(2) The company has no important contingencies that need to be disclosed, which should also be explained
The company has no material contingencies that need to be disclosed.
XIV.. Events after the Balance Sheet Date
(1)Sales return
The company did not have any significant sales returns after the balance sheet date.
(2)Other event
Except for the above-mentioned post-balance sheet events disclosed, the Company has no other significant
post-balance sheet events.
XV. Other Significant Events
Segment Information
The management of the Company divided the Company into 3 segments based on the geographic area:
Northeast China, Central China, and East China. The Northeast is the Company’s general headquarters and
the registered address. The Central is the subsidiary of the Company, Wuhan New World Refrigeration
Industrial Co., Ltd, Wuhan Lanning Energy Technology Co., Ltd, and Chengdu Bingshan Refrigeration
Engineering Co., Ltd. The East is the subsidiary of the Company, Ningbo Bingshan Air-conditioning
Refrigeration Engineering Co., Ltd.
(1) The basis and accounting policies of reporting segments
The internal organization structure, management requirements and internal report scheme are the
determination basis for the Company to set the operating segments. The segments are those satisfied
the following requirements.
1).The segment can generates revenue and incur expenses.
2).The management personnel can regularly evaluate the operation results of segments and allocate
resource ,assess its performance .
3).The financial situation, operation results, cash flow and other accounting information of segments
125
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
can be acquired.
The Company confirms the report segments based on the operating segments. The transfer price among
segments is set base on the market price. The assets and related expenses in common use are allocated to
different segments based on their proportion of revenue.
(2)The financial information of reporting segments
Amount unit ：Ten thousand yuan
30-06-2021/2021.01-06
Items Northeast Central East
Offset Total
China China China
1 Operating income 149,856.46 15,286.12 106.28 -36,062.97 129,185.89
2 Cost 136,260.29 13,135.82 124.33 -35,970.87 113,549.57
Impairment loss on
-73.12 -4.45 -77.57
assets
Impairment loss on
-1,009.97 -199.21 -1,209.19
credit
Depreciation and
3,401.92 612.34 4,014.26
amortization
3 Investment income from
1,692.66 2.88 1,695.54
associates and joint venture
4 Operating profits(loss) 4,551.99 -675.04 -96.85 -518.74 3,261.37
5 Income tax 306.66 -29.25 277.42
6 Net profit(loss) 4,245.32 -645.79 -96.85 -518.74 2,983.95
7 Total assets 664,678.45 51,572.32 0.00 -132,120.62 584,130.15
8 Total liabilities 302,169.74 38,613.90 0.00 -63,595.23 277,188.40
XVI. Notes to the Main Items of the Financial Statements of Parent Company
1. Accounts receivable
(1) Accounts receivable category
Closing Balance
Item Booking balance Provision Booking
Amount % Amount % balance
Accounts
receivable with
significant
721,590,402.25 100.00 81,023,885.50 11.23 640,566,516.75
individual amount
and separate bad
debt provision
Accounts
receivable with bad
debt provision
based on the
characters of credit
risk portfolio
126
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Closing Balance
Item Booking balance Provision Booking
Amount % Amount % balance
Accounting age as
245,888,703.74 34.08 81,023,885.50 32.95 164,864,818.24
characters
Related party
within
475,701,698.51 65.92 475,701,698.51
consolidation
scope
Accounts
receivable with
insignificant
individual amount
and separate bad
debt provision
Total 721,590,402.25 100.00 81,023,885.50 11.23 640,566,516.75
(Continued)
Opening Balance
Item Booking balance Provision Booking
Amount % Amount % balance
Accounts receivable
with significant
individual amount 490,329,366.12 100.00 81,610,090.34 16.64 408,719,275.78
and separate bad
debt provision
Accounts receivable
with bad debt
provision based on
the characters of
credit risk portfolio
Accounting age as
279,002,384.85 56.90 81,610,090.34 29.25 197,392,294.51
characters
Related party within
211,326,981.27 43.10 211,326,981.27
consolidation scope
Accounts receivable
with insignificant
individual amount
and separate bad
debt provision
Total 490,329,366.12 100.00 81,610,090.34 16.64 408,719,275.78
127
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
(1)The bad debt provisions of accounts receivable in the portfolio is accrued under accounting aging
analysis method:
Aging Closing Balance
Within1 year 597,054,751.12
1 to 2 years 43,853,934.70
2 to 3 years 9,741,450.50
More than 3 years 70,940,265.93
3 to 4 years 22,786,105.52
4 to 5 years 14,535,594.76
More than 5 years 33,618,565.65
Total 721,590,402.25
(2) Bad debt provision accrued and reversed (withdraw)
Change during the year
Category Opening balance Closing Balance
Accrued Collected/ reversed Written-off
Bad debt provision 81,610,090.34 1,128,577.16 1,714,782.00 81,023,885.50
Total 81,610,090.34 1,128,577.16 1,714,782.00 81,023,885.50
(3) No accounts receivable written off in current period.
Item Written off amount
Receivable actually written off 1,714,782.00
(4) The top five significant accounts receivable categorized by debtors
Closing
Closing % of the
Company Balance of
Balance total AR
Provision
Hualu Engineering Technology Co.,
40,138,250.00 5.56 2,817,705.15
Ltd.
Xinyi Yuanda Construction and
32,748,744.00 4.54 25,281,907.38
Installation Engineering Co., Ltd.
Qingcheng Zhongyi Energy Co., Ltd 23,475,000.00 3.25 1,142,271.49
Inner Mongolia Xinyuan silicon
13,527,900.00 1.87 949,658.58
material technology Co., Ltd.
Dalian Branch of China Kunlun
11,290,000.00 1.56 792,558.00
Engineering Co., Ltd.
Total 121,179,894.00 16.78
2. Other Receivables
Item Closing Balance Opening Balance
Dividend receivable 16,321,464.90 25,100,920.84
Other receivable 137,867,078.28 29,121,904.34
Total 154,188,541.18 54,222,825.18
128
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
2.1 Dividend receivable
Item Closing Balance Opening Balance
Bingshan Technology Services (Dalian) Co., Ltd. 24,148,920.84
Guotai Junan Securities Co., Ltd. 7,418,805.44 952,000.00
Dalian Universe Thermal Technology Co., Ltd. 2,200,000.00
Dalian Bingshan Engineering & Trading Co., Ltd. 1,282,615.76
Jiangsu Jingxue Insulation Technology Co., Ltd. 4,732,344.00
Dalian Bingshan Group Huahuida Financial Leasing
687,697.70
Co., Ltd.
Total 16,321,464.90 25,100,920.84
2.2 Other receivable
(1) Other receivables categorized by nature
Nature Closing Balance Opening Balance
Equity transfer fund 102,206,391.05
Deposits 11,020.70 20,112,243.72
Petty cash 162,264.99 344,848.03
Guarantee deposits 37,600,456.04 10,466,237.65
Total 139,980,132.78 30,923,329.40
(2) Provision for bad debts
The first phase The second phase The third phase
Provision for bad debts Expected Credit Loss Expected Credit Loss for Total
Expected credit losses in the
for the duration (No the duration (Credit
next 12 months
Credit Devaluation) impairment has occurred)
Balance on January 1, 2022 602,860.06 1,198,565.00 1,801,425.06
The balance of January 1, 2022 in
—— —— —— ——
the current period
Provision for bad debts 311,629.44 311,629.44
Balance on June 30, 2022 1,801,425.06 311,629.44 2,113,054.50
The bad debt provisions of other receivables in the portfolio is accrued under accounting aging analysis
method
Aging Closing Balance
Within 1 year 630,906.59
1 to 2 years 98,373.13
2 to 3 years 114,293.16
More than 3 years 1,269,481.63
3 to 4 years 70,916.63
More than 5 years 1,198,565.00
Total 2,113,054.51
(3) Bad debt provision accrued and reversed (withdraw) in the period.
129
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Opening Change during the year Closing
.Category
balance Accrued Collected/reversed Written-off Balance
Bad debt
1,801,425.06 311,629.44 2,113,054.50
provision
Total 1,801,425.06 311,629.44 2,113,054.50
(4) Other receivables from the top 5 debtors
Closing
Closing % of the
Name Category Aging Balance of
Balance total OR
Provision
Trane Technology Europe holding Within 1
Share transfer 102,206,391.05 74.13
company year
Cangzhou Lingang Renguo Chemical Within 1
Security deposit 2,000,000.00 1.45 83,400.00
Co., Ltd. year
Over 5
Dalian Delta HK China gas Co., Ltd. Security deposit 1,100,000.00
years
0.80 1,100,000.00
Xinjiang Oriental Hope New Energy Within 1
Security deposit 1,000,000.00 0.73 41,700.00
Co., LTD year
Ningxia Crystal New Energy Mate Within 1
Security deposit 1,000,000.00 0.73 41,700.00
rials Co., Ltd. year
Total 107,306,391.05 77.84 1,266,800.00
130
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
3. Long-term equity investments
Category of long-term equity investments
Closing Balance Opening Balance
Item
Closing Balance Provision Book Value Opening Balance Provision Book
tment of subsidiaries 674,238,267.08 674,238,267.08 696,262,267.08 696,2
ment of affiliates and JV 1,202,989,223.45 1,202,989,223.45 1,227,131,957.97 1,227,1
Total 1,877,227,706.53 1,877,227,706.53 1,923,394,225.05 1,923,3
(1) Investments of subsidiaries
Subsidiaries names Opening Balance Increase Decrease Closing Bal
Bingshan Group Construction Co., Ltd 193,749,675.77 193,749,6
Bingshan Group Sales Co., Ltd 20,722,428.15 20,722,4
Bingshan Air-Conditioning Equipment Co., Ltd 45,272,185.00 45,272,1
Bingshan Guardian Automation Co., Ltd. 6,872,117.80 6,872,1
Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. 59,356,051.19 59,356,0
Universe Thermal Technology Co., Ltd. 48,287,589.78 48,287,5
n New World Refrigeration Industrial Co., Ltd 184,674,910.81 184,674,9
han Technical Service （Dalian） Co., Ltd. 22,024,000.00 22,024,000.00
New Meica Electronics Co., Ltd. 43,766,243.72 43,766,2
Bingshan Engineering & Trading Co., Ltd. 71,537,064.86 71,537,0
696,262,267.08 22,024,000.00 674,238,2
(2) Joint ventures& affiliated companies
131
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
Increase/Decrease
Gains and losses Adjustment of
Beginning balance Changes Cash bonus or Provision for Ending ba
recognized other
Increased Decreased of other profits impairment of the Others
under the equity comprehensive
equity announced current period
method income
ppliances -17,939,591.1
90,330,037.43 72,390,4
o., Ltd 9
ppliances
460,060,249.49 17,822,283.19 34,122,000.00 443,760,5
Co., Ltd
ical Co.,
8,926,266.52 358,699.51 9,284,9
Thermal
58,799,068.28 1,112,724.55 59,911,7
o., Ltd
Bingshan
and
2,139,942.18 3,596.55 2,143,5
Machinery
Vending
148,656,014.75 -5,230,752.85 143,425,2
rigeration
14,923,803.87 1,119,014.68 16,042,8
Group
asing Co. 44,789,319.55 511,557.51 687,697.70 44,613,1
Insulation
201,731,528.04 3,118,549.63 4,732,560.00 200,117,5
rigeration
28,480,784.93 1,517,604.68 1,527,045.45 28,471,3
Technical
168,294,942.93 14,532,882.37 182,827,8
Co.,Ltd.
1,227,131,957.97 16,926,568.63 41,069,303.15 1,202,989,2
132
Bingshan Refrigeration & Heat Transfer Technologies Co., Ltd. 2022Semiannual Report
4. Operating revenue and cost
Item 2022.01-06 2021.01-06
Revenue Cost Revenue Cost
Revenue from main operation 435,297,378.67 385,618,374.95 385,929,620.18 336,469,117.09
Revenue from other operation 32,704,249.58 21,958,987.56 20,551,816.12 13,934,076.36
Total 468,001,628.25 407,577,362.51 406,481,436.30 350,403,193.45
5. Investment income
Items 2022.01-06 2021.01-06
Income from long-term equity investments under cost method 3,482,615.76
Income from long-term equity investments under equity method 16,926,568.63 22,157,178.59
Investment income from disposal of long-term equity investment 3,864,200.00
Income from holding and disposing of other non-current financial
63,953,740.43 7,229,604.48
assets
Total 88,227,124.82 29,386,783.07
XVII. Supplementary Information to the Financial Statements
1. Non-operating profit or loss
item Amount
Disposal gains and losses of non-current asset 67,260.20
Government subsidies included in current profit or loss 1,984,170.62
Income from the investment cost of the subsidiary acquired by the enterprise is
less than the fair value of the identifiable net assets of the investee when the 2,834,620.63
investment is acquired
Income from changes in fair value during the period of holding financial assets
13,870,603.52
available for sale and income from disposal of financial assets available for sale
Other non-operating revenue or expense 1,278,039.78
Influence on income tax 992,883.13
Influence on minority shareholders 178,578.45
Total 18,863,233.17
2. Return on equity and earnings per share
Weighted Earnings per share
average (EPS)
Profit of report period return on Basic Diluted
net assets EPS EPS
(%)
Net profit attributable to shareholders of parent company 0.98 0.035 0.035
Net profit after deducting non-recurring gains and losses
0.36 0.013 0.013
attributable to shareholders of parent company
133
