JIANGLING MOTORS CORPORATION, LTD.
FINANCIAL STATEMENTS AND
FOR THE SIX MONTHS ENDED 30 JUNE 2022
1
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY BALANCE SHEET AS AT 30 JUNE 2022
(All amounts in RMB Yuan unless otherwise stated)
30 June 2022 31 December 2021 30June2022 31December2021
Assets Note
Consolidated* Consolidated Company* Company
Current assets
Cash and cash
4(1) 7,799,258,684 9,569,051,314 6,223,403,676 7,706,280,711
equivalents
Financial assets held for
4(2) - 100,242,329 - -
trading
Notes receivable 4(3) 113,987,950 119,783,900 1,400,000,000 300,000,000
4(4)、
Accounts receivable 4,503,086,630 2,994,798,227 1,801,652,252 1,409,320,240
14(1)
Financing receivables 4(5) 286,259,584 201,511,670 11,267,542 13,725,275
Advances to suppliers 4(6) 428,129,558 497,302,198 428,129,558 496,546,531
4(7)、
Other receivables 292,100,216 399,983,736 282,656,320 400,787,837
14(2)
Inventories 4(8) 1,858,396,510 1,974,728,632 1,858,396,510 1,974,728,632
Current portion of non-
4(10) 13,540,397 13,236,153 13,540,397 13,236,153
current assets
Other current assets 4(9) 1,184,665,570 984,174,056 1,184,633,915 881,324,652
Total current assets 16,479,425,099 16,854,812,215 13,203,680,170 13,195,950,031
Non-current assets
Long-term receivables 4(11) 38,129,034 44,952,638 38,129,034 44,952,638
Long-term equity 4(12)、
253,099,622 257,251,255 1,150,650,612 1,103,802,245
investments 14(3)
Fixed assets 4(13) 5,637,147,225 6,029,302,031 5,132,299,354 5,497,170,652
Construction in progress 4(14) 518,054,501 448,338,672 518,054,501 448,112,420
Right-of-use assets 4(15) 266,522,623 306,225,810 265,156,154 304,449,400
Intangible assets 4(16) 1,072,766,835 1,073,881,961 846,403,758 844,988,965
Development
4(16) 187,167,065 111,004,350 187,167,065 111,004,350
expenditures
Deferred tax assets 4(17) 1,287,963,213 1,233,315,188 254,564,928 285,288,625
Other non-current assets 4(18) 129,021,097 - 129,021,097 -
Total non-current assets 9,389,871,215 9,504,271,905 8,521,446,503 8,639,769,295
TOTAL ASSETS 25,869,296,314 26,359,084,120 21,725,126,673 21,835,719,326
2
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY BALANCE SHEET AS AT 30 JUNE 2022(CONTINUED)
(All amounts in RMB Yuan unless otherwise stated)
30 June 2022 31 December 2021 30 June 2022 31 December 2021
Liabilities and equity Note
Consolidated* Consolidated Company* Company
Current liabilities
Short-term borrowings 4(20) 1,400,000,000 300,000,000 1,400,000,000 300,000,000
Derivative financial
4(21) 5,432,067 10,704,619 5,432,067 10,704,619
liabilities
Accounts payable 4(22) 7,924,733,465 9,702,584,830 7,924,733,465 9,702,584,830
Contract liabilities 4(23) 140,093,257 272,274,177 119,105,161 67,392,485
Employee benefits
4(24) 733,050,932 766,986,525 664,978,606 690,921,936
payable
Taxes payable 4(25) 137,510,198 287,171,720 92,117,740 111,626,950
Other payables 4(26) 5,584,079,719 5,253,800,805 2,342,693,694 1,985,838,271
Current portion of non-
4(27) 73,272,572 78,039,188 72,105,132 76,893,591
current liabilities
Other current liabilities 4(28) 412,095,216 420,456,813 45,178,845 35,663,765
Total current liabilities 16,410,267,426 17,092,018,677 12,666,344,710 12,981,626,447
Non-current liabilities
Long-term borrowings 4(29) 1,977,707 2,087,537 1,977,707 2,087,537
Lease liabilities 4(30) 194,073,403 263,409,414 193,269,923 262,016,700
Provisions 4(31) 208,203,479 197,587,164 - -
Deferred income 4(32) 61,322,115 49,074,545 61,322,115 49,074,545
Long-term employee
4(33) 53,747,263 55,684,000 53,433,263 55,370,000
benefits payable
Deferred tax liabilities 4(17) 23,652,989 24,000,545 - -
Other non-current
4(34) 119,298,885 119,777,649 - 108,673,373
liabilities
Total non-current
662,275,841 711,620,854 310,003,008 477,222,155
liabilities
Total liabilities 17,072,543,267 17,803,639,531 12,976,347,718 13,458,848,602
Equity
Share capital 4(35) 863,214,000 863,214,000 863,214,000 863,214,000
Capital surplus 4(36) 839,442,490 839,442,490 839,442,490 839,442,490
Other comprehensive
4(37) (16,422,750) (16,422,750) (16,684,500) (16,684,500)
income
Surplus reserve 4(38) 431,607,000 431,607,000 431,607,000 431,607,000
Retained earnings 4(39) 6,660,369,947 6,437,603,849 6,631,199,965 6,259,291,734
Total equity attributable
to shareholders of the 8,778,210,687 8,555,444,589 8,748,778,955 8,376,870,724
Company
Minority interests 4(40) 18,542,360 - - -
Total equity 8,796,753,047 8,555,444,589 8,748,778,955 8,376,870,724
TOTAL LIABILITIES AND
EQUITY
25,869,296,314 26,359,084,120 21,725,126,673 21,835,719,326
note：* Unaudited financial indexes
3
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY INCOME STATEMENTS FOR 2022 FIRST HALF-YEAR
(All amounts in RMB Yuan unless otherwise stated)
2022 First 2021 First 2022 First 2021 First
Item Note Half-year Half-year Half-year Half-year
Consolidated* Consolidated* Company* Company*
Revenue 4(41)、14(4) 14,222,759,384 17,675,621,088 13,389,364,818 16,423,558,481
4(41)、
Less: Cost of sales (12,331,101,754) (15,050,224,719) (11,909,476,970) (14,542,226,983)
4(47)、14(4)
Taxes and surcharges 4(42) (389,826,444) (479,241,514) (377,488,847) (457,195,578)
Selling and distribution
4(43)、4(47) (696,658,422) (949,514,418) (83,308,622) (137,982,658)
expenses
General and administrative
4(44)、4(47) (452,056,986) (529,817,540) (406,986,891) (446,001,303)
expenses
Research and development
4(45)、4(47) (666,994,373) (726,466,190) (666,994,373) (718,611,661)
expenses
Financial expenses 4(46) 80,197,351 145,442,287 54,389,966 116,227,293
Including: Interest
(28,127,051) (12,133,084) (28,081,558) (12,101,916)
expenses
Interest income 116,152,161 149,147,665 90,066,994 119,819,393
Add: Other income 4(49) 261,059,234 333,292,836 260,767,899 333,208,941
Investment income 4(50)、14(5) (21,941,623) (10,863,242) (21,583,903) (4,619,007)
Including: Share of profit of
associates and joint 4(50)、14(5) (4,151,633) (264,201) (4,151,633) (264,201)
ventures
Gains on changes in fair
4(51) 5,030,223 (5,130,493) 5,272,552 (7,246,932)
value
Credit impairment losses 4(48) 14,373,447 7,389,378 6,759,141 1,197,855
Gains on disposal of assets 4(52) 395,561,300 11,152,182 395,626,098 20,345,706
Operating profit 420,401,337 421,639,655 646,340,868 580,654,154
Add: Non-operating income 4(53) 2,019,528 2,510,277 152,468 1,052,244
Less: Non-operating
4(54) (506,418) (2,584,982) (501,138) (2,387,862)
expenses
Total profit 421,914,447 421,564,950 645,992,198 579,318,536
Less: Income tax expenses 4(55) 8,935 (16,350,895) (44,469,043) (38,064,142)
Net profit 421,923,382 405,214,055 601,523,155 541,254,394
Classified by continuity of
operations
Net profit from continuing
421,923,382 405,214,055 601,523,155 541,254,394
operations
Net profit from discontinued
- - - -
operations
Classified by ownership of
the equity
Minority interests (30,457,640) - - -
Attributable to shareholders
452,381,022 405,214,055 601,523,155 541,254,394
of the Company
Other comprehensive
income, net of tax
Attributable to shareholders
of the Company
Other comprehensive
income items which will not
be reclassified to profit or
loss
Changes arising from
remeasurement of defined 4(37) - - - -
benefit plan
Attributable to minority
- - - -
interests
Total comprehensive
421,923,382 405,214,055 601,523,155 541,254,394
income
4
Attributable to shareholders
452,381,022 405,214,055 601,523,155 541,254,394
of the Company
Attributable to minority
(30,457,640) - - -
interests
Earnings per share
Basic earnings per
4(56) 0.52 0.47 —— ——
share(RMB Yuan)
Diluted earnings per
4(56) 0.52 0.47 —— ——
share(RMB Yuan)
note：* Unaudited financial indexes
5
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS FOR 2022 FIRST HALF-
YEAR
(All amounts in RMB Yuan unless otherwise stated)
2022 First 2021 First 2022 First 2021 First
Item Note Half-year Half-year Half-year Half-year
Consolidated* Consolidated* Company* Company*
Cash flows (uesd in)/generated
from operating activities
Cash received from sales of goods
13,881,647,926 19,342,042,070 13,084,629,718 17,810,262,253
or rendering of services
Refunds of taxes 186,169,752 - 139,724,259 -
Cash received relating to other
4(57) 345,024,561 450,958,933 312,654,885 364,859,759
operating activities
Sub-total of cash inflows 14,412,842,239 19,793,001,003 13,537,008,862 18,175,122,012
Cash paid for goods and services (13,805,191,534) (15,712,429,064) (13,336,027,601) (15,292,180,904)
Cash paid to and on behalf of
(1,339,385,986) (1,504,023,988) (1,232,176,140) (1,400,304,399)
employees
Payments of taxes and surcharges (1,243,506,029) (1,271,259,251) (1,055,447,311) (1,022,744,168)
Cash paid relating to other
4(57) (1,356,305,165) (1,235,370,851) (736,258,757) (663,632,878)
operating activities
Sub-total of cash outflows (17,744,388,714) (19,723,083,154) (16,359,909,809) (18,378,862,349)
Net cash flows (uesd
in)/generated from operating 4(58) (3,331,546,475) 69,917,849 (2,822,900,947) (203,740,337)
activities
Cash flows generated from/(uesd
in) investing activities
Cash received from disposal of
200,000,000 1,850,000,000 - 2,142,000,000
investments
Cash received from returns on
1,523,836 10,204,593 - 3,894,456
investments
Net cash received from disposal of
fixed assets, intangible assets and 781,145,312 13,292,324 781,143,451 12,434,835
other long-term assets
Net cash received from disposal of
subsidiaries and other business 63,700,000 108,000,000 63,700,000 108,000,000
units
Cash received relating to other
4(57) 125,467,180 122,821,020 102,590,963 101,929,208
investing activities
Sub-total of cash inflows 1,171,836,328 2,104,317,937 947,434,414 2,368,258,499
Cash paid to acquire fixed assets,
intangible assets and other long- (619,241,914) (722,025,976) (615,965,224) (715,324,702)
term assets
Cash paid to acquire investments (100,000,000) (1,600,000,000) (51,938,730) (1,688,461,068)
Cash paid relating to other
(11,457,408) (7,829,410) (11,457,408) (7,829,408)
investing activities
Sub-total of cash outflows (730,699,322) (2,329,855,386) (679,361,362) (2,411,615,178)
Net cash flows generated
from/(uesd in) investing 441,137,006 (225,537,449) 268,073,052 (43,356,679)
activities
Cash flows generated from/(uesd
in) financing activities
Cash received from absorbing
49,000,000 - - -
investments
Including: cash received by the
subsidiary from absorbing minority 49,000,000 - - -
shareholders' investment
Cash received from borrowings 2,378,749,167 989,255,556 2,378,749,167 989,255,556
Sub-total of cash inflows 2,427,749,167 989,255,556 2,378,749,167 989,255,556
Cash repayments of borrowings (1,300,208,436) (1,000,214,487) (1,300,208,436) (1,000,214,487)
Cash payments for distribution of (168,968) (2,346,105) (168,968) (2,346,105)
6
dividends, profits or interest
expenses
Cash paid relating to other
4(57) (6,754,924) (4,409,423) (6,420,903) (4,409,424)
financing activities
Sub-total of cash outflows (1,307,132,328) (1,006,970,015) (1,306,798,307) (1,006,970,016)
Net cash flows generated
from/(uesd in) financing 1,120,616,839 (17,714,459) 1,071,950,860 (17,714,460)
activities
Effect of foreign exchange rate
changes on cash and cash - - - -
equivalents
Net decrease in cash and cash
4(58) (1,769,792,630) (173,334,059) (1,482,877,035) (264,811,476)
equivalents
Add: Cash and cash equivalents at
4(58) 9,569,051,314 11,121,955,129 7,706,280,711 8,473,562,045
beginning of year
Cash and cash equivalents at
4(58) 7,799,258,684 10,948,621,070 6,223,403,676 8,208,750,569
end of period
note：* Unaudited financial indexes
7
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2022
(All amounts in RMB Yuan unless otherwise stated)
Attributable to equity owners of the Company
Other Minority
Item Note Share Capital Surplus Retained Total equity
comprehensive interests
capital surplus reserves earnings
income
Balance at 1 January 2021 863,214,000 839,442,490 (11,759,250) 431,607,000 8,863,969,769 - 10,986,474,009
Movements for the six months ended
- - - - (2,595,317,809) - (2,595,317,809)
30 June 2021*
Total comprehensive income
Net profit - - - - 405,214,055 - 405,214,055
Other comprehensive income - - - - - - -
Total comprehensive income for the
- - - - 405,214,055 - 405,214,055
year
Profit distribution
Distribution to shareholders 4(39) - - - - (3,000,531,864) - (3,000,531,864)
Balance at 30 June 2021* 863,214,000 839,442,490 (11,759,250) 431,607,000 6,268,651,960 - 8,391,156,200
Balance at 1 January 2022 863,214,000 839,442,490 (16,422,750) 431,607,000 6,437,603,849 - 8,555,444,589
Movements for the six months ended
- - - - 222,766,098 18,542,360 241,308,458
30 June 2022*
Total comprehensive income
Net profit - - - - 452,381,022 (30,457,640) 421,923,382
Other comprehensive income - - - - - - -
Total comprehensive income for the
- - - - 452,381,022 (30,457,640) 421,923,382
year
Capital contributed by owners and
capital decreases
Capital invested by shareholders - - - - - 49,000,000 49,000,000
Profit distribution
Distribution to shareholders 4(39) - - - - (229,614,924) - (229,614,924)
Balance at 30 June 2022* 863,214,000 839,442,490 (16,422,750) 431,607,000 6,660,369,947 18,542,360 8,796,753,047
note：* Unaudited financial indexes
8
JIANGLING MOTORS CORPORATION, LTD.
COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2022
(All amounts in RMB Yuan unless otherwise stated)
Other
Share Capital Surplus Retained
Item Note comprehensive Total equity
capital surplus reserves earnings
income
Balance at 1 January 2021 863,214,000 839,442,490 (12,021,750) 431,607,000 10,032,100,709 12,154,342,449
Movements for the six months ended 30 June 2021* - - - - (2,459,277,470) (2,459,277,470)
Total comprehensive income
Net profit - - - - 541,254,394 541,254,394
Other comprehensive income - - - - - -
Total comprehensive income for the year - - - - 541,254,394 541,254,394
Profit distribution
Distribution to shareholders 4(39) - - - - (3,000,531,864) (3,000,531,864)
Balance at 30 June 2021* 863,214,000 839,442,490 (12,021,750) 431,607,000 7,572,823,239 9,695,064,979
Balance at 1 January 2022 863,214,000 839,442,490 (16,684,500) 431,607,000 6,259,291,734 8,376,870,724
Movements for the six months ended 30 June 2022* - - - - 371,908,231 371,908,231
Total comprehensive income
Net profit - - - - 601,523,155 601,523,155
Other comprehensive income - - - - - -
Total comprehensive income for the year - - - - 601,523,155 601,523,155
Profit distribution
Distribution to shareholders 4(39) - - - - (229,614,924) (229,614,924)
Balance at 30 June 2022* 863,214,000 839,442,490 (16,684,500) 431,607,000 6,631,199,965 8,748,778,955
note：* Unaudited financial indexes
9
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
1 General information
Jiangling Motors Corporation, Ltd. (hereinafter “the Company”) is a Sino-foreign joint stock
enterprise established under the approval of Hong ban (1992) No. 005 of Nanchang
Revolution and Authorisation Group of Company’s Joint Stock on the basis of Jiangxi
Motors Manufacturing Factory on 16 June 1992. The registration number of the enterprise
business license is No. 913600006124469438. The registered address of the Company
and the address of its headquarters are both Nanchang City, Jiangxi Province of the
People’s Republic of China (“the PRC”).
On 23 July 1993, with the approval of the China Securities Regulatory Commission
(hereinafter “CSRC”) (Zheng Jian Fa Shen Zi [1993] No. 22) and (Zheng Jian Han Zi
[1993] No. 86), the Company was listed on the Stock Exchange of Shenzhen on 1
December 1993, issuing 494,000,000 shares in total. On 8 April 1994, a total of
25,214,000 shares were distributed for the 1993 dividend distribution programme with the
approval of the shareholders’ meeting and Jiangxi Securities Management Leading Group
(Gan Securities [1994] No. 02). In 1995, with the approval of CSRC (Zheng Jian Fa Zi
[1995] No. 144) and the Shenzhen Securities Management Office (Shenzhen Office Fu
[1995] No. 92), the Company issued 174,000,000 ordinary shares (“B shares”). In 1998,
with the approval of CSRC (Zheng Jian Fa Zi [1998] No. 19), the Company issued
additional 170,000,000 B shares.
According to the resolution of the shareholders’ meeting regarding the split share structure
reform on 11 January 2006, the Company implemented the Scheme on Split Share
Structure Reform on 13 February 2006. After the implementation, the Company’s total
paid-in capital remains the same. Related details are disclosed in Note 4(35).
As at 30 June 2022, the Company’s paid-in capital totalled RMB863,214,000, with par
value of RMB1 per share.
The business scope of the Company and its subsidiaries (hereinafter “the Group”)
includes production and sales of automobile assemblies such as automobiles, special
(modified) vehicles, engines and chassis and other automobile parts, and provision of
related after-sales services; retail and wholesale of imported E series automobiles of Ford
Motor (China) Co., Ltd. (“FORD”) as the dealer; import and export of automobiles and
parts; dealership of used cars; provision enterprise management and consulting services
related to production and sales of automobiles.
Subsidiaries included in the consolidation scope for the current period are detailed in Note
6.
These financial statements were authorised for issue by the Company's Board of Directors
on 26th August 2022.
2 Summary of significant accounting policies and accounting estimates
The Group determines specific accounting policies and estimates based on the features of
its production and operation, which mainly comprise the measurement of expected credit
losses (“ECL”) on receivables (Note 2(8)), valuation of inventories (Note 2(9)),
depreciation of fixed assets and amortisation of intangible assets and right-of-use assets
(Note 2(11), (14), (22)), criteria for capitalisation of development expenditures (Note
2(14)), recognition and measurement of revenue (Note 2(19)), etc.
Key judgements and critical accounting estimates and key assumptions applied by the
Group on the determination of significant accounting policies are set out in Note 2(24).
10
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(1) Basis of preparation
The financial statements are prepared in accordance with the Accounting Standards for
Business Enterprises - Basic Standard, specific accounting standards and relevant
regulations issued by the Ministry of Finance on 15 February 2006 and in subsequent
periods (hereinafter collectively referred to as “the Accounting Standards for Business
Enterprises” or “CASs”) and the disclosure requirements in the Preparation Convention of
Information Disclosure by Companies Offering Securities to the Public No.15 - General
Rules on Financial Reporting issued by CSRC.
(2) Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements of the Company for the Six Months Ended 30 June 2022 are in
compliance with the Accounting Standards for Business Enterprises, and truly and
completely present the consolidated and company’s financial position of the Company. As
at 30 June 2022 and their financial performance, cash flows and other information for the
period then ended.
(3) Fiscal year
The Company’s fiscal year starts on 1 January and ends on 30 June.
(4) Recording currency
The recording currency is Renminbi (“RMB”). The financial statements are presented in
RMB.
(5) Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Company
and all of its subsidiaries.
Subsidiaries are consolidated from the date on which the Group obtains control and are
de-consolidated from the date that such control ceases. For a subsidiary that is acquired
in a business combination involving enterprises under common control, it is included in the
consolidated financial statements from the date when it, together with the Company,
comes under common control of the ultimate controlling party. The portion of the net
profits realised before the combination date is presented separately in the consolidated
income statement.
11
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(5) Preparation of consolidated financial statements (Cont'd)
In preparing the consolidated financial statements, where the accounting policies or the
accounting periods of the Company and subsidiaries are inconsistent, the financial
statements of the subsidiaries are adjusted in accordance with the accounting policies and
the accounting period of the Company. For subsidiaries acquired from business
combinations involving enterprises not under common control, the individual financial
statements of the subsidiaries are adjusted based on the fair value of the identifiable net
assets at the acquisition date.
All significant intra-group balances, transactions and unrealised profits are eliminated in
the consolidated financial statements. The portion of subsidiaries’ shareholders' equity
and the portion of subsidiaries’ net profits and losses and comprehensive income for the
period not attributable to the Company are recognised as minority interests, net profit
attributed to minority interests and total comprehensive income attributed to minority
interests, and presented separately in the consolidated financial statements under
shareholders' equity, net profits and total comprehensive income respectively. If the
subsidiaries’ loss for the current period attributed to the minority shareholders exceeds
their share in the opening shareholder’s equity, the excess will be deducted against the
minority interests. Unrealised profits and losses resulting from the sale of assets by the
Company to its subsidiaries are fully eliminated against net profit attributable to owners of
the parent. Unrealised profits and losses resulting from the sale of assets by a subsidiary
to the Company are eliminated and allocated between net profit attributable to owners of
the parent and net profit attributed to minority interests in accordance with the allocation
proportion of the parent in the subsidiary. Unrealised profits and losses resulting from the
sale of assets by one subsidiary to another are eliminated and allocated between net profit
attributable to owners of the parent and net profit attributed to minority interests in
accordance with the allocation proportion of the parent in the subsidiary.
If the accounting treatment of a transaction is inconsistent in the financial statements at
the Group level and at the Company or its subsidiary level, adjustment will be made from
the perspective of the Group.
The Group remeasure the remaining investment held at its fair value in the consolidated
statement of financial position when the control is lost because of the partially disposal of
the equity or other reasons. The difference between the consideration of the disposal as
well as the fair value of the remaining investment and the share of net assets of the former
subsidiary calculated based on the original share since the acquisition date as well as the
good will is recognised in investment income in the period of control lost. In addition, the
other comprehensive income and other changes in owner's equity related to the
investment of the former subsidiary, are reclassified to profit or loss when the control is
lost, except for the changes arising from remeasurement of net liabilities or net assets of
defined benefit, the accumulated changes in fair value from the equity instruments not
held for trading and designated as financial assets at fair value through other
comprehensive income by the investee.
(6) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on
demand, and short-term and highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in value.
12
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(7) Foreign currency translation
Foreign currency transactions
Foreign currency transactions are translated into recording currency using the exchange
rates prevailing at the dates of the transactions.
At the balance sheet date, monetary items denominated in foreign currencies are
translated into recording currency using the spot exchange rates on the balance sheet
date. Exchange differences arising from these translations are recognised in profit or loss
for the current period, except for those attributable to foreign currency borrowings that
have been taken out specifically for acquisition or construction of qualifying assets, which
are capitalised as part of the cost of those assets. Non-monetary items denominated in
foreign currencies that are measured at historical costs are translated at the balance sheet
date using the spot exchange rates at the date of the transactions. The effect of exchange
rate changes on cash is presented separately in the cash flow statement.
(8) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a
financial liability or equity instrument of another entity. A financial asset or a financial
liability is recognised when the Group becomes a party to the contractual provisions of the
instrument.
(a) Financial assets
(i) Classification and measurement
Based on the business model for managing the financial assets and the contractual cash
flow characteristics of the financial assets, financial assets are classified as: (1) financial
assets at amortised cost; (2) financial assets at fair value through other comprehensive
income; (3) financial assets at fair value through profit or loss.
The financial assets are measured at fair value at initial recognition. Related transaction
costs that are attributable to the acquisition of the financial assets are included in the
initially recognised amounts, except for the financial assets at fair value through profit or
loss, the related transaction costs of which are recognised directly in profit or loss for the
current period. Accounts receivable or notes receivable arising from sales of products or
rendering of services (excluding or without regard to significant financing components) are
initially recognised at the consideration that is entitled to be charged by the Group as
expected.
Debt instruments
The debt instruments held by the Group refer to the instruments that meet the definition of
financial liabilities from the perspective of the issuer, and are measured in the following
three ways:
Measured at amortised cost:
The objective of the Group’s business model is to hold the financial assets to collect the
contractual cash flows, and the contractual cash flow characteristics are consistent with a
basic lending arrangement, which gives rise on specified dates to the contractual cash
flows that are solely payments of principal and interest on the principal amount
outstanding. The interest income of such financial assets is recognised using the effective
interest method. Such financial assets mainly include cash at bank and on hand, notes
receivable, accounts receivable, other receivables and long-term receivables, etc.
13
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
Measured at fair value through other comprehensive income:
The objective of the Group’s business model is to hold the financial assets to both collect
the contractual cash flows and sell such financial assets, and the contractual cash flow
characteristics are consistent with a basic lending arrangement. Such financial assets are
measured at fair value through other comprehensive income, except for the impairment
gains or losses, foreign exchange gains and losses, and interest income calculated using
the effective interest method which are recognised in profit or loss for the current period.
Such financial assets mainly include financing receivables, etc.
Measured at fair value through profit or loss:
Debt instruments held by the Group that are not divided into those at amortised cost, or
those measured at fair value through other comprehensive income, are measured at fair
value through profit or loss. At initial recognition, the Group does not designate a portion
of financial assets as at fair value through profit or loss to eliminate or significantly reduce
an accounting mismatch. Financial assets that are due in more than one year as from the
balance sheet date and are expected to be held for over one year are included in other
non-current financial assets, and the others are included in financial assets held for
trading.
14
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(ii) Impairment
Loss provision for financial assets at amortised cost and investments in debt instruments
at fair value through other comprehensive income is recognised on the basis of ECL.
Giving consideration to reasonable and supportable information on past events, current
conditions and forecasts of future economic conditions, as well as the default risk weight,
the Group recognises the ECL as the probability-weighted amount of the present value of
the difference between the cash flows receivable from the contract and the cash flows
expected to collect.
As at each balance sheet date, the ECL of financial instruments at different stages are
measured respectively. 12-month ECL provision is recognised for financial instruments in
Stage 1 that have not had a significant increase in credit risk since initial recognition;
lifetime ECL provision is recognised for financial instruments in Stage 2 that have had a
significant increase in credit risk yet without credit impairment since initial recognition; and
lifetime ECL provision is recognised for financial instruments in Stage 3 that have had
credit impairment since initial recognition.
For the financial instruments with low credit risk on the balance sheet date, the Group
assumes there is no significant increase in credit risk since initial recognition and
recognises the 12-month ECL provision.
For the financial instruments in Stage 1, Stage 2 and with low credit risk, the Group
calculates the interest income by applying the effective interest rate to the gross carrying
amount (before deduction of the impairment provision). For the financial instrument in
Stage 3, the interest income is calculated by applying the effective interest rate to the
amortised cost (after deduction of the impairment provision from the gross carrying
amount).
For notes receivable, accounts receivable and financing receivables arising from sales of
goods and rendering of services in the ordinary course of operating activities, the Group
measures the lifetime ECL provision regardless of whether there is a significant financing
component.
15
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(a) Financial assets (Cont’d)
(ii) Impairment (Cont’d)
In case the ECL of an individually assessed financial asset can be evaluated with reasonable
cost, the Group determines the ECL based on impairment assessment of an individual financial
asset. In case the ECL of an individually assessed financial asset cannot be evaluated with
reasonable cost, the Group divides the receivables into certain groupings based on credit risk
characteristics, and calculates the ECL for the groupings. Basis for determining groupings and
related provision method are as follows:
Grouping - Bank acceptance notes State-owned banks and joint stock banks
Grouping - Trade acceptance notes Customers purchasing using Trade acceptance
Grouping - Sales of general automobiles: Customers of general automobiles
Grouping - Sales of new energy automobiles Customers of new energy automobiles
Grouping - Sales of automobile parts Customers of automobile parts
Grouping - operating advances and
guarantees Operating advances and guarantees
Grouping – Others Accrued interest on cash at bank
For accounts receivable that are classified into groupings and notes receivable and financing
receivables arising from sales of goods and rendering of services in the ordinary course of
operating activities, the Group calculates the ECL with reference to historical credit losses
experience, current conditions and forecasts of future economic conditions, and based on the
exposure at default and the lifetime ECL rate. For other notes receivable, financing receivables
and other receivables classified into groupings, the Group calculates the ECL with reference to
the historical credit loss experience, current conditions and forecasts of future economic
conditions, and based on the exposure at default and the 12-month or lifetime ECL rate.
The Group recognises the loss provision made or reversed into profit or loss for the current
period. For debt instruments held at fair value through other comprehensive income, the Group
adjusts other comprehensive income while the impairment loss or gain is recognised in profit or
loss for the current period.
16
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(a) Financial assets (Cont’d)
(iii) Derecognition
A financial asset is derecognised when: (i) the contractual rights to the cash flows from the
financial asset expire, (ii) the financial asset has been transferred and the Group transfers
substantially all the risks and rewards of ownership of the financial asset to the transferee,
or (iii) the financial asset has been transferred and the Group has not retained control of
the financial asset, although the Group neither transfers nor retains substantially all the
risks and rewards of ownership of the financial asset.
When a financial asset is derecognised, the difference between the carrying amount and
the sum of the consideration received and the cumulative changes in fair value that are
previously recognised directly in other comprehensive income is recognised in profit or
loss for the current period.
(b) Financial liabilities
Financial liabilities are classified as financial liabilities at amortised cost and financial
liabilities at fair value through profit or loss at initial recognition.
Financial liabilities of the Group mainly comprise financial liabilities at amortised cost,
including notes payable, accounts payable, other payables, borrowings, etc. Such
financial liabilities are initially recognised at fair value, net of transaction costs incurred,
and subsequently measured using the effective interest method. Financial liabilities that
are due within one year (inclusive) are classified as current liabilities; those with maturities
over one year but are due within one year (inclusive) as from the balance sheet date are
classified as current portion of non-current liabilities. Others are classified as non-current
liabilities.
A financial liability is derecognised or partly derecognised when the underlying present
obligation is discharged or partly discharged. The difference between the carrying amount
of the derecognised part of the financial liability and the consideration paid is recognised
in profit or loss for the current period.
17
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont’d)
(c) Determination of fair value of financial instruments
The fair value of a financial instrument that is traded in an active market is determined at
the quoted price in the active market. The fair value of a financial instrument that is not
traded in an active market is determined by using a valuation technique. In valuation, the
Group adopts valuation techniques applicable in the current situation and supported by
adequate available data and other information, selects inputs with the same characteristics
as those of assets or liabilities considered in relevant transactions of assets or liabilities by
market participants, and gives priority to the use of relevant observable inputs. When
relevant observable inputs are not available or feasible, unobservable inputs are adopted.
(9) Inventories
(a) Classification
Inventories include raw materials, work in progress products, finished goods, materials in
transit, low value consumables, materials consigned for processing, etc., and are
measured at the lower of cost and net realisable value.
(b) Costing of inventories
Cost is determined using the weighted average method. The cost of finished goods and
work in progress comprise raw materials, direct labour and systematically allocated
production overhead based on the normal production capacity.
(c) Basis for determining net realisable value of inventories and method for making provision
for inventories
Provision for inventories is determined at the excess amount of the carrying amounts of
the inventories over their net realisable value. Net realisable value is determined based on
the estimated selling price in the ordinary course of business, less the estimated costs to
completion and estimated costs necessary to make the sale and related taxes.
(d) The Group adopts the perpetual inventory system.
(e) Amortisation methods of low-value consumables
Low-value consumables are amortised into expenses in full when issued for use.
18
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(10) Long-term equity investments
Long-term equity investments comprise the Company’s long-term equity investments in its
subsidiaries, and the Group’s long-term equity investments in its associates.
Subsidiaries are the investees over which the Company is able to exercise control.
Associates are the investees that the Group has a significant influence on their financial
and operating decisions.
Investments in subsidiaries are presented using the cost method in the Company’s
financial statements, and adjusted to the equity method when preparing the consolidated
financial statements. Investments in associates are accounted for using the equity
method.
(a) Determination of investment cost
For long-term equity investments acquired through a business combination involving
enterprises under common control, the investment cost shall be the absorbing party’s
share of the carrying amount of owners’ equity of the party being absorbed in the
consolidated financial statements of the ultimate controlling party at the combination date;
for long-term equity investments acquired through a business combination not involving
enterprises under common control, the investment cost shall be the combination cost.
For long-term equity investments acquired not through a business combination, such as
long-term equity investments acquired by payment in cash, the initial investment cost shall
be the purchase price actually paid; for long-term equity investments acquired by issuing
equity securities, the initial investment cost shall be the fair value of the equity securities
issued.
(b) Subsequent measurement and recognition of profit or loss
Long-term equity investments accounted for using the cost method are measured at the
initial investment cost. Cash dividend or profit distribution declared by an investee is
recognised as investment income into profit or loss for the current period.
Where the initial investment cost exceeds the Group’s share of the fair value of the
investee’s identifiable net assets at the time of acquisition, the investment is initially
measured at that cost. Where the initial investment cost is less than the Group’s share of
the fair value of the investee’s identifiable net assets at the time of acquisition, the
difference is included in profit or loss for the current period and the cost of the long-term
equity investment is adjusted upwards accordingly.
19
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(10) Long-term equity investments (Cont’d)
(b) Subsequent measurement and recognition of profit or loss (Cont’d)
For long-term equity investments accounted for using the equity method, the Group
recognises the investment income or losses according to its share of net profit or loss of
the investee. The Group does not recognise further losses when the carrying amounts of
the long-term equity investment together with any long-term interests that, in substance,
form part of the Group’s net investment in investees are reduced to zero. However, if the
Group has obligations for additional losses and the criteria with respect to recognition of
provisions are satisfied, the Group continues recognising the investment losses and the
provisions at the amount it expects to undertake. The Group’s share of the changes in
investee’s owner's equity other than those arising from the net profit or loss, other
comprehensive income and profit distribution is recognised in capital surplus with a
corresponding adjustment to the carrying amounts of the long-term equity investment. The
carrying amount of the investment is reduced by the Group’s share of the profit distribution
or cash dividends declared by the investees. Unrealised gains or losses on transactions
between the Group and its investees are eliminated to the extent of the Group’s equity
interest in the investees, based on which the investment income or losses are recognised.
Any losses resulting from transactions between the Group and its investees, which are
attributable to asset impairment losses are not eliminated.
(c) Basis for determining existence of control and significant influence over investees
Control is the power over investees that can bring variable returns through involvement in
related activities of investees and the ability to influence the returns by using such power
over investees.
Significant influence is the power to participate in making decisions on financial and
operating policies of the investee but is not control or joint control over making those
policies.
(d) Impairment of long-term equity investments
The carrying amounts of long-term equity investments in subsidiaries and associates is
reduced to the recoverable amounts when the recoverable amounts are below their
carrying amount (Note 2(15)).
(11) Fixed assets
(a) Recognition and initial measurement of fixed assets
Fixed assets comprise buildings, machinery and equipment, Vehicles, moulds, and
electronic and other equipment.
Fixed assets are recognised when it is probable that the related economic benefits will
flow to the Group and the costs can be reliably measured. Fixed assets purchased or
constructed by the Group are initially measured at cost at the time of acquisition. The fixed
assets contributed by the state-owned shareholders upon the restructuring of the
Company are recorded at the valued amount determined by the state-owned asset
administration department.
20
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11) Fixed assets (Cont’d)
(a) Recognition and initial measurement of fixed assets (Cont’d)
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed
asset when it is probable that the associated economic benefits will flow to the Group and
the related cost can be reliably measured. The carrying amount of the replaced part is
derecognised. All the other subsequent expenditures are recognised in profit or loss for
the period in which they are incurred.
(b) Depreciation methods of fixed assets
Fixed assets are depreciated using the straight-line method to allocate the cost of the
assets to their estimated net residual values over their estimated useful lives. For the fixed
assets that have been provided for impairment loss, the related depreciation charge is
prospectively determined based upon the adjusted carrying amounts over their remaining
useful lives.
The estimated useful lives, the estimated net residual values expressed as a percentage
of cost and the annual depreciation rates of fixed assets are as follows:
Estimated useful Estimated net Annual depreciation
lives residual values rates
Buildings 35 to 40 years 4% 2.4% to 2.7%
Machinery and equipment 10 to 15 years 4% 6.4% to 9.6%
Vehicles 5 to 10 years 4% 9.6% to 19.2%
Moulds 5 years - 20%
Electronic and other
equipment 5 to 7 years 4% 13.7% to 19.2%
The estimated useful life and the estimated net residual value of a fixed asset and the
depreciation method applied to the asset are reviewed and adjusted as appropriate at
each year-end.
(c) The carrying amount of a fixed asset is reduced to the recoverable amount when the
recoverable amount is below the carrying amount (Note 2(15)).
(d) Disposal of fixed assets
A fixed asset is derecognised on disposal or when no future economic benefits are
expected from its use or disposal. The amount of proceeds from disposals on sale,
transfer, retirement or damage of a fixed asset net of its carrying amount and related taxes
and expenses is recognised in profit or loss for the current period.
21
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(12) Construction in progress
Construction in progress is measured at actual cost. Actual cost comprises construction
costs, installation costs, borrowing costs that are eligible for capitalisation and other costs
necessary to bring the construction in progress ready for their intended use. Construction
in progress is transferred to fixed assets when the assets are ready for their intended use,
and depreciation is charged starting from the following month. The carrying amount of
construction in progress is reduced to the recoverable amount when the recoverable
amount is below the carrying amount (Note 2(15)).
(13) Borrowing costs
The borrowing costs that are directly attributable to acquisition and construction of an
asset that needs a substantially long period of time for its intended use commence to be
capitalised and recorded as part of the cost of the asset when expenditures for the asset
and borrowing costs have been incurred, and the activities relating to the acquisition and
construction that are necessary to prepare the asset for its intended use have
commenced. The capitalisation of borrowing costs ceases when the asset under
acquisition or construction becomes ready for its intended use and the borrowing costs
incurred thereafter are recognised in profit or loss for the current period. Capitalisation of
borrowing costs is suspended during periods in which the acquisition or construction of an
asset is interrupted abnormally and the interruption lasts for more than 3 months, until the
acquisition or construction is resumed.
The capitalised amount of specific borrowings intended to be used for the acquisition and
construction of qualifying assets is determined by the interest expenses incurred in the
current period less interest income of the unused borrowings deposited at banks or
investment income from temporary investments.
The capitalised amount of general borrowings intended to be used for the acquisition or
construction of qualifying assets is determined by the weighted average of the excess of
accumulated capital expenditure over capital expenditure of the special borrowings
multiplied by the weighted average effective interest rate of the utilised general
borrowings. The effective interest rate is the rate at which the future cash flows of the
borrowings over the expected lifetime or a shorter applicable period are discounted into
the initial recognised amount of the borrowings.
(14) Intangible assets
Intangible assets include land use rights, software use fees, non-patent technologies and
after-sales service management mode, and are measured at cost.
(a) Land use rights
Land use rights are amortised on the straight-line basis over their approved use period of
50 years. If the acquisition costs of the land use rights and the buildings located thereon
cannot be reasonably allocated between the land use rights and the buildings, all of the
acquisition costs are recognised as fixed assets.
22
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(14) Intangible assets (Cont’d)
(b) Software use fees
Software use fees are amortised on a straight-line basis over the estimated useful life of 5
years.
(c) Non-patent technologies
Non-patent technologies are amortised on the straight-line basis over the estimated useful
life of 5 years.
(d) Periodical review of useful life and amortisation method
For an intangible asset with a finite useful life, review of its useful life and amortisation
method is performed at each year-end, with adjustment made appropriately.
(e) Research and development
The expenditure on an internal research and development project is classified into
expenditure on the research phase and expenditure on the development phase based on
its nature and whether there is material uncertainty that the research and development
activities can form an intangible asset at the end of the project.
Expenditure on the research phase related to planned survey, evaluation and selection for
research on manufacturing technique of automobile products is recognised in profit or loss
in the period in which it is incurred. Prior to mass production, expenditure on the
development phase related to the design and testing phase in regard to the final
application of manufacturing technique of automobile products is capitalised only if all of
the following conditions are satisfied:
the development of manufacturing technique of automobile products has been fully
demonstrated by technical team;
management intends to complete the development of manufacturing technique of
automobile products, and use or sell it;
the research and analysis of preliminary market survey indicate that products
manufactured with manufacturing technique of automobile products are marketable;
adequate technical and financial supports are available for development of
manufacturing techniques of automobile products and subsequent mass production;
and
expenditure on development of manufacturing techniques of automobile products can
be reliably collected.
Other expenditures on the development phase that do not meet the conditions above are
recognised in profit or loss in the period in which they are incurred. Development
expenditures previously recognised as expenses are not recognised as an asset in a
subsequent period. Capitalised expenditure on the development phase is presented as
development expenditures in the balance sheet and transferred to intangible assets at the
date that the asset is ready for its intended use.
(f) Impairment of intangible assets
The carrying amounts of intangible assets are reduced to the recoverable amounts when
the recoverable amounts are below their carrying amounts (Note 2(15)).
23
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(15) Impairment of long-term assets
Fixed assets, construction in progress, right-of-use assets, intangible assets with finite
useful lives and long-term equity investments in subsidiaries and associates are tested for
impairment if there is any indication that the assets may be impaired at the balance sheet
date; intangible assets that are not yet available for their intended use are tested for
impairment at least once a year, irrespective of whether there is any indication of
impairment. If the result of the impairment test indicates that the recoverable amount of an
asset is less than its carrying amount, a provision for impairment and an asset impairment
loss are recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair value less
disposal costs and the present value of the future cash flows expected to be derived from
the asset. Provision for asset impairment is determined and recognised on the individual
asset basis. If it is not possible to estimate the recoverable amount of an individual asset,
the recoverable amount of a group of assets to which the asset belongs is determined. A
group of assets is the smallest group of assets that is able to generate independent cash
inflows.
Goodwill that is separately presented in the financial statements is tested at least once a
year for impairment, irrespective of whether there is any indication that it may be impaired.
In conducting the test, the carrying amount of goodwill is allocated to the related asset
group or groups of asset groups which are expected to benefit from the synergies of the
business combination. If the result of the test indicates that the recoverable amount of an
asset group or a group of asset groups, including the allocated goodwill, is lower than its
carrying amount, the corresponding impairment loss is recognised. The impairment loss is
first deducted from the carrying amount of goodwill that is allocated to the asset group or
group of asset groups, and then deducted from the carrying amounts of other assets
within the asset group or group of asset groups in proportion to the carrying amounts of
assets other than goodwill.
Once the above asset impairment loss is recognised, it will not be reversed for the value
recovered in the subsequent periods.
(16) Employee benefits
Employee benefits refer to all forms of consideration or compensation given by the Group
in exchange for service rendered by employees or for termination of employment
relationship, which include short-term employee benefits, post-employment benefits,
termination benefits, etc.
(a) Short-term employee benefits
Short-term employee benefits include wages or salaries, bonus, allowances and
subsidies, staff welfare, premiums or contributions on medical insurance, work injury
insurance and maternity insurance, housing funds, union running costs and employee
education costs, short-term paid absences, etc. The short-term employee benefits actually
occurred are recognised as a liability in the accounting period in which the service is
rendered by the employees, with a corresponding charge to the profit or loss for the
current period or the cost of relevant assets. Non-monetary benefits are measured at fair
value.
24
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Employee benefits (Cont'd)
(b) Post-employment benefits
The Group classifies post-employment benefit plans as either defined contribution plans or
defined benefit plans. Defined contribution plans are post-employment benefit plans under
which the Group pays fixed contributions into a separate fund and will have no obligation
to pay further contributions; and defined benefit plans are post-employment benefit plans
other than defined contribution plans. During the reporting period, premiums or
contributions on basic pensions and unemployment insurance paid for employees belong
to defined contribution plans; supplementary retirement benefits for employees are defined
benefit plans.
(i) Defined contribution plans
Basic pensions
The Group’s employees participate in the basic pension plan set up and administered by
local authorities of Ministry of Human Resources and Social Security. Monthly payments of
premiums on the basic pensions are calculated according to the bases and percentage
prescribed by the relevant local authorities. When employees retire, the relevant local
authorities are obliged to pay the basic pensions to them. The amounts based on the
above calculations are recognised as liabilities in the accounting period in which the
service has been rendered by the employees, with a corresponding charge to the profit or
loss for the current period or the cost of relevant assets.
(ii) Defined benefit plans
The Group also provides employees with supplementary retirement benefits in addition to
the insurance system prescribed by the State. Such supplementary retirement benefits
belong to defined benefit plans. The defined benefit liabilities recognised on the balance
sheet represent the present value of defined benefit obligations less the fair value of the
plan assets. The defined benefit obligations are calculated annually by an independent
actuary using projected unit credit method at the interest rate of treasury bonds with similar
obligation term and currency. Service costs related to supplementary retirement benefits
(including current service costs, historical service costs and settled gains or losses) and
net interest are recognised in profit or loss for the current period or the cost of related
assets, and changes arising from remeasurement of net liabilities or net assets of defined
benefit plans are recognised in other comprehensive income.
(c) Termination benefits
The Group provides compensation for terminating the employment relationship with
employees before the end of the employment contracts or as an offer to encourage
employees to accept voluntary redundancy before the end of the employment contracts.
The Group recognises a liability arising from compensation for termination of the
employment relationship with employees, with a corresponding charge to profit or loss for
the current period at the earlier of the following dates: 1) when the Group cannot
unilaterally withdraw an employment termination plan or a curtailment proposal; 2) when
the Group recognises costs or expenses for a restructuring that involves the payment of
termination benefits.
25
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Employee benefits (Cont'd)
(c) Termination benefits (Cont’d)
Early retirement benefits
The Group offers early retirement benefits to those employees who accept early
retirement arrangements. The early retirement benefits refer to the salaries and social
security contributions to be paid to and for the employees who accept voluntary retirement
before the normal retirement date prescribed by the State, as approved by the
management. The Group pays early retirement benefits to those early retired employees
from the early retirement date until the normal retirement date. The Group accounts for the
early retirement benefits in accordance with the treatment for termination benefits, in
which the salaries and social security contributions to be paid to and for the early retired
employees from the off-duty date to the normal retirement date are recognised as
liabilities with a corresponding charge to the profit or loss for the current period. The
differences arising from the changes in the respective actuarial assumptions of the early
retirement benefits and the adjustments of benefit standards are recognised in profit or
loss in the period in which they occur.
The termination benefits expected to be settled within one year since the balance sheet
date are classified as employee benefits payable.
(17) Dividend distribution
Cash dividends are recognised as liabilities in the period in which the dividends are
approved at the shareholders’ meeting.
(18) Provisions
Provisions for product warranties, compensation to suppliers, etc. are recognised when
the Group has a present obligation, it is probable that an outflow of economic benefits will
be required to settle the obligation, and the amount of the obligation can be measured
reliably.
A provision is initially measured at the best estimate of the expenditure required to settle
the related present obligation. Factors on a contingency, such as the risks, uncertainties
and the time value of money, are taken into account as a whole in reaching the best
estimate of a provision. Where the effect of the time value of money is material, the best
estimate is determined by discounting the related future cash outflows. The increase in the
discounted amount of the provision arising from passage of time is recognised as interest
expense.
The carrying amount of provisions is reviewed at each balance sheet date and adjusted to
reflect the current best estimate.
The provisions expected to be settled within one year since the balance sheet date are
classified as current liabilities.
26
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(19) Revenue
The Group manufactures automobiles and automobile parts and sells them to distributors
and end customers. In addition, the Group also provides customers with auto maintenance
and additional quality warranty services. The Group recognises revenue at the amount of
the consideration that is entitled to be charged by the Group as expected when the
customer obtains control over relevant goods or services.
(a) Selling automobiles and automobile parts to distributors and end customers
The Group manufactures automobiles and automobile parts and sells such products to
distributors and end customers. The Group recognises revenue from sales of automobiles
after they are delivered as prescribed in the contract, customers have accepted the
products and the delivery documents have been signed by both parties. The Group
recognises revenue from sales of parts after they are delivered to the designated location
as prescribed in the contract, customers have accepted the products and the delivery
documents have been signed by both parties.
Where two or more obligations are included in a contract between the Group and the
customers, at the beginning date of the contract, the Group allocates the transaction price
to individual obligation in the relative proportion to the individual selling prices of products
or services committed in each individual obligation. When the individual selling price is
unobservable, the Group makes reasonable estimates on the individual selling price with
comprehensive consideration to all available information, and by using market adjustment
method, cost plus method, etc.
The credit periods granted by the Group to distributors and end customers are generally
within one year, which is consistent with the industry practice, and there is no significant
financing component. The Group provides product warranties for automobiles and
automobile parts as required by laws and regulations, and recognises the corresponding
provisions (Note 2(18)).
The Group provides distributors and end customers with sales discounts based on sales
volume, and related revenue is recognised at contract consideration net of the discount
amount estimated based on historical experience and using the expected value method.
(b) Rendering of services
The Group provides customers with car maintenance and additional quality warranty
services, and the revenue is recognised based on the progress of service provision within
a certain period. According to the nature of the service provided, the performance
progress is determined in accordance with the value of the labour provided to the
customer.
When the Group recognises revenue based on the stage of completion, the amount with
unconditional collection right obtained by the Group is recognised as accounts receivable,
and the rest is recognised as contract assets. Meanwhile, loss provision for accounts
receivable and contract assets are recognised on the basis of ECL (Note 2(8)). If the
contract price received or receivable exceeds the amount for the completed service, the
excess portion will be recognised as contract liabilities. Contract assets and contract
liabilities under the same contract are presented on a net basis.
27
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(20) Government grants
Government grants refer to the monetary or non-monetary assets obtained by the Group
from the government, including support funds for enterprise development, financial
subsidies, etc.
Government grants are recognised when the grants can be received and the Group can
comply with all attached conditions. If a government grant is a monetary asset, it will be
measured at the amount received or receivable. If a government grant is a non-monetary
asset, it will be measured at its fair value. If it is unable to obtain its fair value reliably, it will
be measured at its nominal amount.
Government grants related to assets refer to government grants which are obtained by the
Group for the purposes of purchase, construction or acquisition of the long-term assets.
Government grants related to income refer to the government grants other than those
related to assets.
Government grants related to assets are recorded as deferred income and recognised in
profit or loss on a reasonable and systemic basis over the useful lives of the assets.
Government grants related to income that compensate future costs, expenses or losses
are recorded as deferred income and recognised in profit or loss in reporting the related
expenses; government grants related to income that compensate incurred costs, expenses
or losses are recognised in profit or loss directly in the current period.
The Group applies the presentation method consistently to the similar government grants
in the financial statements.
Government grants that are related to ordinary activities are included in operating profit,
otherwise, they are recorded in non-operating income.
The interest subsidies directly received from government are recorded as a reduction of
interest expenses.
28
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(21) Deferred tax assets and deferred tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognised based on the
differences arising between the tax bases of assets and liabilities and their carrying
amounts (temporary differences). Deferred tax asset is recognised for the deductible
losses that can be carried forward to subsequent years for deduction of the taxable profit
in accordance with the tax laws. No deferred tax liability is recognised for a temporary
difference arising from the initial recognition of goodwill. No deferred tax asset or deferred
tax liability is recognised for the temporary differences resulting from the initial recognition
of assets or liabilities due to a transaction other than a business combination, which
affects neither accounting profit nor taxable profit (or deductible 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 realised or the liability is settled.
Deferred tax assets are only recognised for deductible temporary differences, deductible
losses and tax credits to the extent that it is probable that taxable profit will be available in
the future against which the deductible temporary differences, deductible losses and tax
credits can be utilised.
Deferred tax liabilities are recognised for taxable temporary differences arising from
investments in subsidiaries and associates, except where the Group is able to control the
timing of reversal of such temporary differences, and it is probable that the temporary
differences will not reverse in the foreseeable future. When it is probable that the
deductible temporary differences arising from investments in subsidiaries and associates
will be reversed in the foreseeable future and that the taxable profit will be available in the
future against which the deductible temporary differences can be utilised, the
corresponding deferred tax assets are recognised.
Deferred tax assets and deferred tax liabilities are offset when:
the deferred tax assets and deferred tax liabilities are related to the same tax payer
within the Group and the same taxation authority; and
that tax payer within the Group has a legally enforceable right to offset current tax
assets against current tax liabilities.
29
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(22) Leases
A contract is, or contains, a lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for consideration.
The Group as the lessee:
At the commencement date, the Group shall recognise the right-of-use asset and measure
the lease liabilities at the present value of the lease payments that are not paid at that
date. Lease payments include fixed payments, the exercise price of a purchase option if
the lessee is reasonably certain to exercise that option, and payments of penalties for
terminating the lease if the lessee exercises an option to terminate the lease. Variable
lease payments in proportion to sales are excluded from lease payments and recognised
in profit or loss as incurred. Lease liabilities that are due within one year (inclusive) as
from the balance sheet date are included in the current portion of non-current liabilities.
The Group's right-of-use assets represent leased buildings. Right-of-use assets are
measured initially at cost which comprises the amount of the initial measurement of lease
liabilities, any lease payments made at or before the commencement date and any initially
direct costs, less any lease incentives received. If it is reasonably probable that the Group
will obtain ownership of the underlying asset by the end of the lease term, the asset is
depreciated over its remaining useful life; otherwise the asset is depreciated over the
shorter of the lease term and its remaining useful life. The carrying amounts of the right-of-
use assets are reduced to the recoverable amounts when the recoverable amounts are
below their carrying amounts (Note 2(15)).
For short-term leases with a term of 12 months or less and leases of an individual asset
(when new) of low value, the Group may, instead of recognising right-of-use assets and
lease liabilities, recognise the lease payments in the cost of the underlying assets or in
profit or loss for the current period on a straight-line basis over the lease term.
The Group shall account for a lease modification as a separate lease if both: (1) the
modification extends the scope of the lease by adding the right to use one or more
underlying assets; (2) the increased consideration is equivalent to the amount of the
individual price of the expanded part of the lease scope adjusted according to the contract
conditions.
For a lease modification that is not accounted for as a separate lease, the Group shall
redetermine the lease term at the effective date of the lease modification, and remeasure
the lease liability by discounting the revised lease payments using a revised discount rate,
except for the simplified method for contract changes directly caused by COVID-19. For a
lease modification which narrows the scope of the lease or shortens the lease term, the
Group decreases the carrying amount of the right-of-use asset, and recognises in profit or
loss any gain or loss relating to the partial or full termination of the lease. For other
changes which lead to the remeasurement of lease liabilities, the Group correspondingly
adjusts the carrying amount of the right-of-use asset.
For the rental waivers due to COVID-19 and for the period ended before 30 June 2022
only, the Group applies the simplified method, records the undiscounted waivers in profit
or loss and adjusts lease liability when the agreement is reached to dismiss the original
payment obligation.
30
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(22) Leases (Cont'd)
The Group as the lessor
A lease is classified as a finance lease if it transfers substantially all the risks and rewards
incidental to ownership of an underlying asset. An operating lease is a lease other than a
finance lease.
As the lessor, the Group does not hold any finance lease. Where the Group leases out
self-owned buildings under operating leases, rental income therefrom is recognised on a
straight-line basis over the lease term.
(23) Segment information
The Group identifies operating segments based on the internal organisation structure,
management requirements and internal reporting system, and discloses segment
information of reportable segments which is determined on the basis of operating
segments.
An operating segment is a component of the Group that satisfies all of the following
conditions: (1) the component is able to earn revenues and incur expenses from its
ordinary activities; (2) whose operating results are regularly reviewed by the Group’s
management to make decisions about resources to be allocated to the segment and to
assess its performance, and (3) for which the information on financial position, operating
results and cash flows is available to the Group. Two or more operating segments that
have similar economic characteristics and satisfy certain conditions can be aggregated
into one single operating segment.
31
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements
The Group continually evaluates the critical accounting estimates and key judgements
applied based on historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.
(a) Critical judgements in applying the accounting policies
(i) Classification of financial assets
Significant judgements made by the Group in the classification of financial assets include
business models and analysis on contractual cash flow characteristics.
The Group determines the business model for financial assets management on the group
basis, and factors to be considered include the methods for evaluating the financial assets
performance and reporting such performance to key management personnel, the risks
relating to the financial assets performance and corresponding management methods, the
ways in which related business management personnel are remunerated, etc.
When assessing whether contractual cash flow characteristics of financial assets are
consistent with basic lending arrangement, key judgements made by the Group include:
the possibility of changes in time schedule or amount of the principal during the lifetime
due to reasons such as repayment in advance; whether interest only includes time value
of money, credit risks, other basic lending risks and considerations for costs and profits.
For example, whether the repayment in advance only reflects the principal outstanding
and corresponding interest and reasonable compensation paid for early termination of the
contract.
(ii) Judgement on significant increase in credit risk and occurrence of credit impairment
Judgement made by the Group for significant increase in credit risk is mainly based on
whether the overdue days exceed 30 days, or whether one or more of the following
indicators change significantly: business environment of the debtor, internal and external
credit rating, significant changes in actual or expected operating results, significant
decrease in value of collateral or credit rate of guarantor, etc.
Judgement made by the Group for the occurrence of credit impairment is mainly based on
whether the overdue days exceed 90 days (i.e., a default has occurred), or whether one or
more of the following conditions is/are satisfied: the debtor is suffering significant financial
difficulties, the debtor is undergoing other debt restructuring, or the debtor probably goes
bankrupt, etc.
32
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(a) Critical judgements in applying the accounting policies (Cont’d)
(iii) Judgement on capitalisation of development expenditures
Development expenditures are capitalised when the criteria in Note 2(14)(e) are fulfilled.
The assessments on whether the criteria for capitalisation of development expenditures
have been met involve judgements of the Group, including the technical feasibility of the
project, the likelihood of the project generating sufficient future economic benefits and the
timing to start capitalisation particularly. The Group makes the judgements on the
capitalisation of development expenditures and records the process in meeting minutes
based on feasibility analysis, regular review on the development project phase, etc.
(iv) Timing of revenue recognition
The Group sells automobiles and automobile parts to distributors or end customers. The
Group recognises revenue from sales of automobiles after they are delivered as prescribed
in the contract, distributors or end customers have accepted the products and the delivery
documents have been signed by both parties. The Group recognises revenue from sales of
parts after they are delivered to the designated location as prescribed in the contract,
distributors or end customers have accepted the products and the delivery documents are
signed by both parties. Thereafter, the distributors or end customers own the products, have
the right to set prices independently, and bear the risks from price fluctuation or damage of
the products. The distributors or end customers have obtained the control of the products
after accepting the products. Therefore, the Group recognises the sales revenue of the
products at the time when the delivery documents have been signed.
(v) Sales with product warranties
The Group provides statutory warranty for automobiles and automobile parts, and the
periods and terms of such warranty comply with the requirements of laws and regulations
related to the products. The Group does not provide any significant additional service or
additional warranty for this purpose, thus this kind of warranty cannot be identified as a
separate performance obligation. In addition, the Group also offers additional warranty other
than the requirements of laws and regulations, which is identified as a separate
performance obligation. The Group recognises the revenue of the additional warranty over
time during the period when services are rendered.
33
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions
The critical accounting estimates and key assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within the next fiscal
year are outlined below:
(i) Measurement of ECL
The Group calculates ECL through default risk exposure and ECL rate and determines the
ECL rate based on default probability and default loss rate. In determining the ECL rate, the
Group uses data such as internal historical credit loss experience, etc., and adjusts historical
data based on current conditions and forward-looking information.
When considering forward-looking information, the Group takes different macroeconomic
scenarios into consideration. In the first half of 2022, the weights of “base”, “bad” and “good”
are 68%, 16% and 16% (In the first half of 2021: 68%, 16% and 16%) under three economic
scenarios respectively for the consideration of forward-looking information. The Group
regularly monitors, and reviews important macroeconomic assumptions and parameters
related to the calculation of ECL rate, including the risks of economic downturn, external
market environment, changes of technological environment and customer, gross domestic
product, consumer price index and broad money supply. In the first half of 2022, the Group
has considered the uncertainty caused by COVID-19 and updated relevant assumptions and
parameters accordingly. The key macroeconomic parameters used in each scenario are
listed as follows:
Scenarios
Base Bad Good
Gross domestic product 7.81% 4.74% 10.89%
Consumer price index 1.82% -1.38% 5.02%
34
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions (Cont’d)
(ii) Impairment of long-term asset
The Group assesses whether there is any indication that non-current assets other than
financial assets may be impaired at the balance sheet date. When there are indications
showing the carrying amounts of such assets cannot be recovered, an impairment test will
be performed.
When the carrying amount of non-current assets or asset groups other than financial assets
is higher than the recoverable amount, which is the higher of an asset’s fair value less
disposal costs and the present value of the future cash flows expected to be derived from
the asset, it shows non-current assets or asset groups are impaired.
The amount of an asset’s fair value less disposal costs was determined by the price of a
sale agreement in a fair trade, less the costs that are directly attributable to the disposal of
the asset. Where there is no sales agreement but there is an active market of assets, the
amount is determined by the market price less the costs that are directly attributable to the
disposal of the asset. The market price of assets is determined by the considerations
provided by the buyer. Where there is no sales agreement or active market of assets, the
amount of an asset’s fair value less disposal costs was determined based on the best
information available, with reference to the latest transaction price or results of similar assets
of the same industry.
Disposal costs include legal cost, taxes and handling fee related to asset disposal, and
direct costs incurred to bring the assets to a saleable state.
(iii) Income tax and deferred income tax
The Group is subject to enterprise income tax in multiple regions. There are some
transactions and events for which the ultimate tax treatment is uncertain during the ordinary
course of business. Significant judgement is required from the Group in determining the
provision for income taxes in each of these regions. Where the final tax outcome of these
matters is different from the amounts that were initially recorded, such differences will impact
the income tax and deferred tax provisions in the period in which such determination is
made.
35
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions (Cont’d)
(iii) Income tax and deferred income tax (Cont’d)
As stated in Note 3(2), the Company is a high-tech enterprise. The “High-Tech Enterprise
Certificate” is effective for three years. Upon expiration, application for high-tech enterprise
assessment should be submitted again to the relevant government authorities. Based on
the past experience of reassessment for high-tech enterprise upon expiration and its
actual conditions, the Company considers that it is able to obtain the qualification for high-
tech enterprises in the next 3 years, and therefore a preferential tax rate of 15% is used to
calculate the corresponding deferred income tax. If the Company cannot obtain the
qualification for high-tech enterprise upon expiration, then the Company is subject to a
statutory tax rate of 25% for the calculation of income tax, which further influences the
recognised deferred tax assets, deferred tax liabilities and income tax expenses.
Deferred tax assets are recognised for the deductible tax losses that can be carried
forward to subsequent years to the extent that it is probable that taxable profit will be
available in the future against which the deductible tax losses can be utilised. Taxable
profit that will be available in the future includes the taxable profit that will be realised
through ordinary course of business and the taxable profit that will be increased upon the
future reversal of taxable temporary differences incurred in prior periods. Judgements and
estimates are required to determine the time and amounts of taxable profit in the future.
Any difference between the reality and the estimate may result in adjustment to the
carrying amount of deferred tax assets.
(iv) Provisions
The Group undertakes after-sales repair or replacement obligations for automobiles sold
based on the after-sales service agreement. Management estimates related provisions
based on historical after-sales service data, including the repair and replacement provided
as well as current trends.
Factors that may impact the estimation of warranty costs include improvement of the
Group’s productivity and production quality, as well as changes in related parts and labour
costs. Any increase or decrease in provisions will have impact on profit or loss of the
Group in the future.
36
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions (Cont’d)
(v) Provision for decline in the value of inventories
The Group's inventories are stated at the lower of cost and net realisable value. Net
realisable value of inventories is the amount of the estimated selling price in the ordinary
course of business, less the estimated costs to completion and estimated costs necessary
to make the sales and related taxes.
If the management revises the estimated selling price of the inventory, the estimated costs
to be incurred by the time of completion, and the estimated selling expenses and related
taxes, the revised estimated selling price is lower than the currently adopted estimated
selling price, or the revised until The estimated costs, estimated sales expenses, and
related taxes and fees at the completion of the project are higher than the currently
adopted estimates, the Group needs to make provision for inventory.
If the actual selling prices, costs to completion, selling and distribution expenses and
related taxes are higher or lower than management’s estimates, the Group shall recognise
the relevant differences in the consolidated income statement during the corresponding
accounting period.
(25) Significant changes in accounting policies
The Ministry of Finance released the Notice on Adjusting the Application Scope of the
Provisions on the Accounting Treatment Regarding COVID-19-Related Rent Concessions
(Cai Kuai [2021] No. 9), the Circular on Issuing Interpretation No. 14 of Accounting
Standards for Business Enterprises (Cai Kuai [2021] No. 1) and Q&A on Implementation
of Accounting Standards for Business Enterprises in 2021. The financial statements for
the Six Months Ended 30 June 2022 have been prepared in accordance with the above
standard, circular and Q&A, and the impacts on the financial statements of the Group and
the Company are as follows:
(a) Accounting treatment regards COVID-19-related rent concession
For the part of the rent concession that is caused directly by COVID-19, which is
respectively made with the lessee and the lessor and happened before 30 June 2022, the
Group and the Company has taken simplified methods in the above Notice when
preparing the financial statement for the Six Months Ended 30 June 2022. The notice
listed above has no impact on the accounting treatment of the Group and the Company as
the lessor.
37
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(25) Significant changes in accounting policies (Cont’d)
(b) Accounting treatment for changes on the basis of determining the contractual cash flows of
financial assets or financial liabilities due to the reform in the benchmark interest rate
Reform towards benchmark interest rate, specified in Interpretation No. 14 of Accounting
Standards for Business Enterprises, has no significant influence towards the basis of
determining the contractual cash flows of financial assets and financial liabilities when
preparing the Group and Company’s financial statements for the Six Months Ended 30 June
2022.
3 Taxation
(1) The main categories and rates of taxes applicable to the Group are set out below:
Category Taxation basis Tax rate
Enterprise income tax (a) Taxable income 15% and 25%
Value-added tax (“VAT”) Taxable value-added amount (Tax payable 13%, 9% and 6%
(b) is calculated using the taxable sales
amount multiplied by the applicable tax
rate less deductible input VAT of the
current period)
Consumption tax (c) Taxable sales amount 3%, 5% and 9%
City maintenance and The payment amount of VAT and 5% and 7%
construction tax (d) consumption tax
(a) Pursuant to the Circular on Enterprise Income Tax Policy Concerning Deductions for
Equipment and Appliances (Cai Shui [2018] No. 54) and the Announcement on Extending the
Implementation Period of Certain Preferential Tax Policies (Cai Shui [2021] No. 6) issued by
the State Taxation Administration and relevant regulations, during the period from 1 January
2018 to 31 December 2023, the cost of newly purchased equipment with the original cost less
than RMB5 million can be fully deducted against taxable profit in the next month after the
asset is put into use, instead of being depreciated annually for tax filing.
Pursuant to the Circular on Further Improving Pre-tax additional deduction for Research and
Development Expenses (Cai Shui [2021] No. 13) issued by the Ministry of Finance and the
State Taxation Administration, from 1 January 2021, the Group’s actual research and
development expenses that are not recognised as intangible assets but included in profit or
loss, are allowed to 100% pre-tax additional deduction; those expenses recognised as
intangible assets can be amortised before tax at 200% of the costs of intangible assets.
(b) Pursuant to the Announcement on Relevant Policies for Deepening Value-Added Tax Reform
(Announcement [2019] No. 39) and relevant regulations jointly issued by the Ministry of
Finance, the State Taxation Administration and the General Administration of Customs, the
Group’s taxable products sales revenue is subject to the VAT at the rate of 13%. The Group's
real estate leasing business is subject to the VAT at the rate of 9%. Revenue from provision of
technical service to external parties is subject to VAT at the rate of 6%.
38
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
3 Taxation (Cont’d)
(1) The main categories and rates of taxes applicable to the Group are set out below (Cont’d):
(c) Pursuant to the Interim Regulations of the People's Republic of China on Consumption Tax
promulgated by the State Council (Order No. 539 of the State Council of the People's
Republic of China) and the Notice of Ministry of Finance and State Taxation Administration on
Adjusting Consumption Tax Policies for Passenger Cars (Cai Shui [2008] No. 105), the
consumption tax rates of the Group's taxable products are 3%, 5% and 9%.
(d) Pursuant to the Circular of the State Council on Unifying the Collection of City Construction
and Maintenance Tax and Educational Surcharge on Domestic and Foreign-Owned
Enterprises and Individuals (Guo Fa [2010] No. 35) issued by the State Council, the Group is
subject to city construction and maintenance tax at the rates of 5% and 7%.
(2) Tax preference
Pursuant to the Circular on the Announcement of the First Batch of High-Tech Enterprises of
Jiangxi Province for the year 2021 (Gan Gao Qi Ren Ban [2021] No. 8), the Company is
certified as a high-tech enterprise, and the valid term is three years. During the period from 1
January 2021 to 31 December 2023, the Company is subject to enterprise income tax at the
rate of 15%.
In 2022, except for the Company, the Company’s wholly-owned companies, including JMC
Heavy Duty Vehicle Co., Ltd. (“JMCH”), Jiangling Motor Sales Co., Ltd. (“JMCS”), Shenzhen
Fujiang New Energy Automobile Sales Co., Ltd. (“SZFJ”), and Guangzhou Fujiang New
Energy Automobile Sales Co., Ltd. (“GZFJ”), were subject to the enterprise income tax at the
rate of 25%. The company’s holding subsidiary Jiangling Ford Motor Technology (Shanghai) Co., Ltd.
（“Jiangling Ford Technology”） was subject to the enterprise income tax at the rate of 25%
39
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements
(1) Cash at bank and on hand
30 June 2022 31 December 2021
Cash at bank (a) 7,799,258,684 9,569,051,314
(a) As at 30 June 2022, cash at bank of the Group deposited with Jiangling Motor Group
Finance Company (“JMCF”) was RMB741,784,787 (31 December 2021:
RMB1,059,580,980) (Note 8(6)), and interest was calculated at the bank annual interest
rate for RMB deposit of 1.725% to 2.25% over the same period (2021: 1.725% to
2.25%)(Note 8(5)).
JMCF, a holding subsidiary of Jiangling Motors Group Co., Ltd (“JMCG”), is a non-banking
financial institution. JMCG holds 50% equity capital of Nanchang Jiangling Investment
Co., Ltd. (“JIC”), a main shareholder of the Company.
(2) Financial assets held for trading
30 June 2022 31 December 2021
Structural deposits - 100,242,329
(3) Notes receivable
30 June 2022 31 December 2021
Trade acceptance notes 113,987,950 119,783,900
Less: Provision for bad debts - -
113,987,950 119,783,900
(a) As at 30 June 2022, there were no notes receivable pledged.
(b) As at 30 June 2022, there was no notes receivable that have been endorsed or discounted
but not yet matured.
(c) Provision for bad debts
For notes receivable arising from sales of goods and rendering of services in the ordinary
course of operating activities, the Group measures the loss provision based on the lifetime
ECL regardless of whether there is a significant financing component. As at 30 June 2022,
the acceptors of the notes receivable held by the Group were dealers with good credit and
the Group therefore believed that the relevant notes receivable would not result in material
losses due to their defaults.
40
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable
30 June 2022 31 December 2021
Accounts receivable 4,707,595,902 3,213,330,895
Less: Provision for bad debts (204,509,272) (218,532,668)
4,503,086,630 2,994,798,227
(a) The ageing of accounts receivable is analysed as follows:
30 June 2022 31 December 2021
Within 1 year 4,370,867,407 2,713,109,300
1 to 2 years 2,875,838 128,900,600
Over 2 years 333,852,657 371,320,995
4,707,595,902 3,213,330,895
(b) As at 30 June 2022, the top five accounts receivable ranked by remaining balances are
analysed as follows:
Amount of provision % of total
Balance for bad debts balance
Company 1 1,515,593,940 (1,737,398) 32.19%
Company 2 111,812,079 (41,801) 2.38%
Company 3 101,717,442 (37,978) 2.16%
Company 4 88,989,702 (36,084) 1.89%
Company 5 84,790,397 (695,802) 1.80%
1,902,903,560 (2,549,063) 40.42%
(c) Provision for bad debts
For accounts receivable, the Group measures the loss provision based on the lifetime ECL
regardless of whether there is a significant financing component.
(i) Accounts receivable for which provision for bad debts is made on the individual basis are
analysed as follows:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
New energy subsidies
receivable i) 103,180,418 100% (103,180,418)
Receivables for
automobiles ii) 80,752,812 100% (80,752,812)
183,933,230 (183,933,230)
41
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(i) Accounts receivable for which provision for bad debts is made on the individual basis are
analysed as follows (Cont’d):
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
New energy subsidies
receivable i) 103,180,418 100% (103,180,418)
Receivables for
automobiles ii) 80,862,880 100% (80,862,880)
184,043,298 (184,043,298)
i) As at 30 June 2022 and 31 December 2021, government subsidies receivable for new
energy automobiles amounted to RMB103,180,418, as the corresponding new energy
vehicles may not meet the corresponding subsidy policy standards, the Group considered
the receivables cannot be collected, therefore, full provision was made for those
receivables.
ii) As at 30 June 2022 and 31 December 2021, since aforesaid companies in debts had
difficulties in operation and were involved in several legal proceedings, the Group
considered that it was difficult to recover such receivables, therefore, full provision was
made for those receivables.
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows:
Grouping - Sales of general automobiles:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 3,461,261,005 0.04% (1,294,211)
Overdue for 1 to 30 days 323,846,206 0.04% (121,218)
Overdue for 31 to 60 days 154,548,824 0.86% (1,331,630)
Overdue for 61 to 90 days 36,070,131 2.39% (863,486)
Overdue over 90 days 36,848,589 3.95% (1,457,231)
4,012,574,755 (5,067,776)
42
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - Sales of general automobiles(Cont’d):
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Not overdue 2,279,044,623 0.08% (1,829,856)
Overdue for 1 to 30 days 182,608,365 0.08% (146,245)
Overdue for 31 to 60 days 48,703,203 2.44% (1,186,068)
Overdue for 61 to 90 days 25,563,462 4.15% (1,061,263)
Overdue over 90 days 37,478,374 5.01% (1,876,531)
2,573,398,027 (6,099,963)
Grouping - Sales of new energy automobiles:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Overdue over 90 days 65,245,565 21.06% (13,742,299)
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Overdue over 90 days 187,009,300 14.67% (27,438,915)
43
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - Automobile parts:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Not overdue 359,092,293 0.30% (1,088,180)
Overdue for 1 to 30 days 66,611,013 0.30% (199,833)
Overdue for 31 to 60 days 5,111,057 0.50% (25,555)
Overdue for 61 to 90 days 2,627,848 0.60% (15,767)
Overdue over 90 days 12,400,141 3.52% (436,632)
445,842,352 (1,765,967)
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Not overdue 236,210,964 0.30% (708,633)
Overdue for 1 to 30 days 10,782,728 0.30% (32,348)
Overdue for 31 to 60 days 14,692,940 0.50% (73,465)
Overdue for 61 to 90 days 3,469,461 0.60% (20,817)
Overdue over 90 days 3,724,177 3.09% (115,229)
268,880,270 (950,492)
(iii) The provision for bad debts in the current period amounted to RMB14,023,396 was
reversed, because the accrued bad debts were received in 2022. Among them, RMB
110,068 of accounts receivable for which provision for bad debts was made on the
individual basis in the previous period were recovered in the current period, and the
corresponding book balance was RMB 110,068. The significant amounts reversed or
recovered were as follows:
Basis and justification for
Reasons for determining the provision for Amount of Recovery
reversal/recovery bad debts reversal/recovery method
The aforesaid companies in
debts had difficulties in
The actual receipt operation and were involved in
of account several legal proceedings, the
receivables relating Group considered the
to the provision for receivables cannot be collected,
Accounts bad debts made in therefore, full provision was
receivable 1 the prior period. made for those receivables. 110,068 Received
(d) As at 30 June 2022 and 31 December 2021, there were no accounts receivable pledged.
44
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(5) Financing receivables
30 June 2022 31 December 2021
Bank acceptance notes 286,259,584 201,511,670
The Group endorses the bank acceptance notes as required by daily fund management,
which also met the criteria for derecognition, and therefore classified those the bank
acceptance notes as financial assets at fair value through other comprehensive income.
The Group had no bank acceptance notes for which the provision for impairment was
made on the individual basis. As at 30 June 2022, the Group measures the loss provision
of financing receivables based on the lifetime ECL . As at 30 June 2022, the acceptors of
the Groups’ notes receivable were mainly major state-owned banks or large and medium-
sized banks with good reputation and credit ranking. Therefore, the Group expected there
was no significant loss on related bank acceptance notes arising from bank default.
As at 30 June 2022, the Group had no pledged bank acceptance notes receivable
presented in financing receivables.
As at 30 June 2022, the Group's notes receivable had been endorsed or discounted but
not yet matured were as follows:
Derecognised Not derecognised
Bank acceptance notes 1,275,480,753 -
(6) Advances to suppliers
(a) The ageing of advances to suppliers is analysed as below:
30 June 2022 31 December 2021
% of total % of total
Amount balance Amount balance
Within 1 year 428,129,558 100% 497,302,198 100%
(b) As at 30 June 2022, the top five advances to suppliers ranked by remaining balances are
analysed as follows:
Amount % of total balance
Company 1 328,060,152 76.63%
Company 2 52,873,991 12.35%
Company 3 27,075,537 6.32%
Company 4 10,893,548 2.54%
Company 5 6,421,133 1.50%
425,324,361 99.34%
45
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(7) Other receivables
30 June 2022 31 December 2021
Receivable for subsidiary
disposal(Note 5) 188,300,000 252,000,000
Advances for gas fee 13,866,643 7,409,989
Import working capital advances 10,000,000 25,000,000
Disposal of assets 4,930,445 17,668,457
Others 75,713,157 98,941,850
292,810,245 401,020,296
Less: Provision for bad debts (710,029) (1,036,560)
292,100,216 399,983,736
(a) The ageing of other receivables is analysed as follows:
30 June 2022 31 December 2021
Within 1 year 288,500,177 398,699,129
Over 1 year 4,310,068 2,321,167
292,810,245 401,020,296
(b) Provision for losses and changes in book balance statements:
Stage 1 Stage 3
Lifetime ECL
12-month ECL (grouping) (credit-impaired) Total
Provisi
on for Provision
Provision for Book bad for bad
Book balance bad debts balance debts debts
31 December 2021 401,020,296 (1,036,560) - - (1,036,560)
Increase/(decrease) in
the current period (108,262,989) - 52,938 - -
Reversal in the current
period - - - (2,118) (2,118)
Write-off in the current
period - 328,649 - - 328,649
30 June 2022 292,757,307 (707,911) 52,938 (2,118) (710,029)
As at 30 June 2022 and 31 December 2021, the Group had no other receivables at Stage
2. The analysis of other receivables at Stage 1 and Stage 3 is stated below:
(i) As at 30 June 2022 and 31 December 2021, the Group had no other receivables with
provision for bad debts on the individual basis.
46
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(7) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d):
(ii) As at 30 June 2022 and 31 December 2021, the Group’s other receivables with provision
for bad debts on the grouping basis were analysed below:
Other receivables with provision on the grouping basis at Stage 1:
30 June 2022 31 December 2021
Book balance Provision for losses Book balance Provision for losses
Provision Provision
Amount ratio Amount Amount ratio Amount
Grouping of operating
advances and
guarantees:
Within 1 year 231,988,892 0.30% (695,140) 343,446,354 0.30% (1,029,601)
Over 1 year 4,257,130 0.30% (12,771) 2,321,167 0.30% (6,959)
Grouping of others i):
Within 1 year 56,511,285 - - 55,252,775 - -
292,757,307 (707,911) 401,020,296 (1,036,560)
i) As at 30 June 2022 and 31 December 2021, the grouping of others are mainly interest
receivables from the Group's bank deposits. the Group’s interest receivable from cash at
bank mainly came from major state-owned banks or other large and medium sized banks
with good reputation and credit ranking. Therefore, the Group expected that there was no
material credit risk associated with related interest receivable and thus there was no
significant losses on related interest receivable from bank default.
Other receivables with provision on the grouping basis at Stage 3:：
30 June 2022 31 December 2021
Book balance Provision for losses Book balance Provision for losses
Provisio Provisio
Amount n ratio Amount Amount n ratio Amount
Grouping of operating
advances and
guarantees:
Over 1 year 52,938 4.00% (2,118) - - -
47
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(c) For the six months ended 30 June 2022, The amount of bad debt provision was RMB2,118.,
The provision for bad debts amounted to RMB328,649 was reversed.
(d) As at 30 June 2022, the top five other receivables by the balance of the debtors are listed as
follows:
% of
total Provision for
Nature Balance Ageing balance bad debts
Receivable for
subsidiary
Company 1 disposal 188,300,000 Within 1 year 64.31% (564,900)
Advances
classified as
Company 2 expenses 13,853,696 Within 1 year 4.73% (41,561)
Advances
classified as
Company 3 expenses 10,000,000 Within 1 year 3.42% (30,000)
Disposal of
Company 4 assets 4,604,745 Within 1 year 1.57% (13,814)
Advances
classified as
Company 5 expenses 4,535,834 Within 1 year 1.55% (13,608)
221,294,275 75.58% (663,883)
48
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(8) Inventories
(a) Inventories are summarised by categories as follows:
30 June 2022 31 December 2021
Provision for Carrying Provision for Carrying
Book balance inventories amount Book balance inventories amount
Raw materials 1,055,501,759 (66,180,981) 989,320,778 875,837,414 (70,998,768) 804,838,646
Finished goods 454,372,320 - 454,372,320 740,881,390 - 740,881,390
Work in progress 213,331,412 (1,008,410) 212,323,002 205,597,637 (1,297,098) 204,300,539
Materials in
transit 86,701,332 - 86,701,332 94,075,651 - 94,075,651
Low-cost
consumables 91,046,008 (185,448) 90,860,560 93,028,528 (4,443,955) 88,584,573
Materials
processed on
commission 24,818,518 - 24,818,518 42,047,833 - 42,047,833
1,925,771,349 (67,374,839) 1,858,396,510 2,051,468,453 (76,739,821) 1,974,728,632
(b) Provision for inventories is analysed as follows:
Increase in the
31 December current period Decrease in the current period 30 June
2021 Provision Reversal Write-off 2022
Raw materials (70,998,768) - - 4,817,787 (66,180,981)
Low-cost
consumables (4,443,955) - - 4,258,507 (185,448)
Work in progress (1,297,098) - - 288,688 (1,008,410)
(76,739,821) - - 9,364,982 (67,374,839)
(c) Provision for decline in the value of inventories is as follows:
Reason for current year reversal or
Specific basis for determining net write-off of provision for decline in
realisable value the value of inventories
Raw materials/Work in Based on the estimated selling price, Increase in the net realisable value of
progress/Low value less the estimated costs to completion, the inventories of which a provision
consumables estimated selling and distribution for decline in the value had been
expenses and related taxes made in prior years or sales
realised
49
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(9) Other current assets
30 June 2022 31 December 2021
Taxes prepaid, input VAT to be
deducted and to be verified 1,184,665,570 984,174,056
(10) Current portion of long-term receivables
30 June 2022 31 December 2021
Current portion of long-term
receivables(Note 4(11)) 13,540,397 13,236,153
(11) Long-term receivables
30 June 2022 31 December 2021
Long-term receivables 56,535,507 64,375,548
Less: Unearned financing income (4,696,469) (5,993,630)
Provision for bad debts (169,607) (193,127)
Current portion of long-term
receivables (13,540,397) (13,236,153)
38,129,034 44,952,638
As at 30 June 2022, the Group's long-term receivables were generated by instalment collections
from disposal of fixed assets, which will be recovered from 2022 to 2026.
50
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(12) Long-term equity investments
30 June 2022 31 December 2021
Associate
- Shanxi Yunnei Power Co., Ltd. (“The Power Company”) 216,835,692 220,842,615
- Hanon Systems (Nanchang) Co., Ltd. (“Hanon Systems”) 36,263,930 36,408,640
Less: Provision for impairment of long-term equity investments - -
253,099,622 257,251,255
Associate
Movements for the current period
Cash
Share of net dividends Ending
31 profit/(loss) declared balance of
December Increase in the under equity by joint Provision for 30 June Shareholding Voting rights provision for
2021 current period method ventures impairment 2022 (%) (%) impairment
The Power Company 220,842,615 - (4,006,923) - - 216,835,692 40% 40% -
Hanon Systems 36,408,640 - (144,710) - - 36,263,930 19.15% 33.33% -
Total 257,251,255 - (4,151,633) - - 253,099,622
Related information of equity in associates is set forth in Note 6(2).
51
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Fixed assets
30 June 2022 31 December 2021
Fixed assets (a) 5,637,036,553 6,027,890,644
Fixed assets pending for disposal (b) 110,672 1,411,387
5,637,147,225 6,029,302,031
(a) Fixed assets
Machinery and Electronic and
. Buildings equipment Vehicles Moulds other equipment Total
Cost
31 December 2021 2,745,069,082 3,491,849,012 376,797,673 3,235,951,735 3,882,390,000 13,732,057,502
Increase in the
current period
Transfer from
construction in
progress - 55,598,316 8,266,550 225,797,315 75,242,634 364,904,815
Decrease in the
current period
Disposal or
retirement (545,490,834) (4,776,830) (5,890,934) (77,546,897) (19,506,588) (653,212,083)
Others - (71,073,989) - - (51,017,227) (122,091,216)
30 June 2022 2,199,578,248 3,471,596,509 379,173,289 3,384,202,153 3,887,108,819 13,321,659,018
Accumulated
depreciation
31 December 2021 (623,685,758) (1,675,100,705) (231,571,055) (2,486,558,453) (2,318,281,178) (7,335,197,149)
Increase in the
current period
Provision (29,270,265) (132,169,374) (18,700,043) (79,166,122) (175,811,583) (435,117,387)
Decrease in the
current period
Disposal or
retirement 261,824,676 3,187,768 4,653,611 63,906,167 17,838,464 351,410,686
Others - 46,231,843 - - 44,120,419 90,352,262
30 June 2022 (391,131,347) (1,757,850,468) (245,617,487) (2,501,818,408) (2,432,133,878) (7,328,551,588)
Provision for
impairment
31 December 2021 - (12,564,527) (2,833,467) (336,857,072) (16,714,643) (368,969,709)
Increase in the
current period
Provision - - - - - -
Decrease in the
current period
Disposal or
retirement - 737,384 259,118 10,545,025 1,357,305 12,898,832
30 June 2022 - (11,827,143) (2,574,349) (326,312,047) (15,357,338) (356,070,877)
Carrying amount
30 June 2022 1,808,446,901 1,701,918,898 130,981,453 556,071,698 1,439,617,603 5,637,036,553
31 December 2021 2,121,383,324 1,804,183,780 142,393,151 412,536,210 1,547,394,179 6,027,890,644
For the six months ended 30 June 2022, depreciation charged to fixed assets amounted to
RMB435,117,387 (the six months ended 30 June 2021: RMB433,395,705), of which the
depreciation expenses charged in the cost of sales, selling and distribution expenses, general and
administrative expenses and research and development expenses were RMB353,653,366,
RMB1,141,073, RMB47,510,686 and RMB32,812,262 (the six months ended 30 June 2021:
RMB336,443,335, RMB1,008,818, RMB63,916,100 and RMB32,027,452), respectively.
52
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Fixed assets (Cont’d)
(a) Fixed assets (Cont’d)
The costs of fixed assets transferred from construction in progress amounted to
RMB364,904,815( the six months ended 30 June 2021: RMB129,605,207).
(i) Temporarily idle fixed assets
As at 30 June 2022, the fixed assets with a carrying amount of approximately
RMB544,197,433 (a cost of RMB1,523,873,635) (31 December 2021: a carrying amount of
approximately RMB862,054,869 and a cost of RMB2,081,185,910) were temporarily idle due
to the reorganization plan of JMCH and the change of business development, product
strategies, product process, etc. The analysis is as follows:
Accumulated Provision for Carrying
Cost depreciation impairment amount
Buildings 409,240,038 (91,246,226) - 317,993,812
Machinery and
equipment 169,905,796 (94,798,073) (5,077,105) 70,030,618
Vehicles 74,967,830 (52,299,737) (2,477,224) 20,190,869
Moulds 476,542,160 (162,770,288) (312,658,359) 1,113,513
Electronic and
other equipment 393,217,811 (246,671,786) (11,677,404) 134,868,621
1,523,873,635 (647,786,110) (331,890,092) 544,197,433
(ii) Fixed assets with pending certificates of ownership:
Reasons for not obtaining
Carrying amount certificates of ownership
Buildings 680,482,049 Pending procedures
53
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Fixed assets (Cont’d)
(b) Fixed assets pending for disposal
30 June 2022 31 December 2021
Electronic and other
equipment 85,891 1,096,021
Machinery and equipment 24,781 280,051
Vehicles - 35,315
110,672 1,411,387
(14) Construction in progress
30 June 2022 31 December 2021
Provision Provision
for Carrying for Carrying
Book balance impairment amount Book balance impairment amount
V363C project 132,735,336 - 132,735,336 29,320,960 - 29,320,960
N822 project 69,884,750 - 69,884,750 92,903,791 - 92,903,791
JP360 57,810,850 - 57,810,850 2,615,448 - 2,615,448
CX743 conversion 44,064,311 44,064,311 62,473,608 62,473,608
project - -
P789 project 37,377,865 - 37,377,865 122,400 - 122,400
Fushan new plant 34,118,177 34,118,177 56,875,765 56,875,765
investment project - -
CX756 project 32,101,575 - 32,101,575 50,714,716 - 50,714,716
Capacity optimisation 20,640,798 20,640,798 18,120,130 18,120,130
project - -
L536 13,179,838 - 13,179,838 - - -
V362 MCA project 6,896,254 - 6,896,254 4,666,773 - 4,666,773
JF8/CX743 project 3,622,051 - 3,622,051 3,622,051 - 3,622,051
Coating VOC treatment 2,264,071 2,264,071 59,811,593 59,811,593
project - -
Construction of Xiaolan 1,899,942 1,899,942 1,858,797 1,858,797
600 mu Phase 3 plan - -
Other miscellaneous
and pending
installation projects 62,150,329 (691,646) 61,458,683 65,924,286 (691,646) 65,232,640
518,746,147 (691,646) 518,054,501 449,030,318 (691,646) 448,338,672
54
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Construction in progress (Cont’d)
(a) Movement of significant projects of construction in progress
% of Accumulative Including:
Transfer to fixed project capitalised Borrowing costs
Budget 31 December Increase in the assets in the Decrease in the investment Progress borrowing capitalised in the
Project name (In RMB 0’000) 2021 current period current period current period 30 June 2022 in budget of project costs current period Source of fund
V363C project 54,300 29,320,960 104,764,788 (1,350,412) - 132,735,336 25% 25% - - Self-owned funds
N822 project 20,700 92,903,791 68,352,088 (91,371,129) - 69,884,750 86% 86% - - Self-owned funds
JP360 26,823 2,615,448 55,195,402 - - 57,810,850 24% 24% - - Self-owned funds
CX743 conversion
project 11,349 62,473,608 29,014,612 (47,423,909) - 44,064,311 83% 83% - - Self-owned funds
P789 project 27,688 122,400 37,255,465 - - 37,377,865 13% 13% - - Self-owned funds
Fushan new plant
investment project 205,200 56,875,765 21,955,628 (44,713,216) - 34,118,177 96% 96% - - Self-owned funds
CX756 project 17,768 50,714,716 16,872,349 (35,485,490) - 32,101,575 85% 85% - - Self-owned funds
Capacity optimisation
project 133,990 18,120,130 19,309,767 (16,459,099) (330,000) 20,640,798 75% 75% - - Self-owned funds
L536 7,735 - 13,179,838 - - 13,179,838 17% 17% - - Self-owned funds
V362 MCA project 3,966 4,666,773 4,030,206 (1,800,725) - 6,896,254 22% 22% - - Self-owned funds
JF8/CX743 project 13,690 3,622,051 - - - 3,622,051 96% 96% - - Self-owned funds
Coating VOC treatment
project 7,730 59,811,593 22,829,334 (80,376,856) - 2,264,071 93% 93% - - Self-owned funds
Construction of Xiaolan
600 mu Phase 3 plan 20,977 1,858,797 1,174,549 (1,133,404) - 1,899,942 80% 80% - - Self-owned funds
Other miscellaneous
and pending
installation projects 65,924,286 42,909,345 (44,790,575) (1,892,727) 62,150,329 292,897 - Self-owned funds
449,030,318 436,843,371 (364,904,815) (2,222,727) 518,746,147 292,897
55
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Construction in progress (Cont’d)
(b) Provision for impairment of construction in progress
Increase in the Decrease in the
31 December 2021 current period current period 30 June 2022 Reason for provision
Other miscellaneous
and pending The recoverable amount is lower
installation projects (691,646) - - (691,646) than the book value
56
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(15) Right-of-use assets
Buildings
Cost
31 December 2021 362,092,645
Increase in the current period
New lease contracts -
Decrease in the current period
Expiration of lease contract (9,795,685)
30 June 2022 352,296,960
Accumulated depreciation
31 December 2021 (55,866,835)
Increase in the current period
Provision (35,233,057)
Decrease in the current period
Expiration of lease contract 5,325,555
30 June 2022 (85,774,337)
Provision for impairment
31 December 2021 -
Increase in the current period -
Decrease in the current period -
30 June 2022 -
Carrying amount
30 June 2022 266,522,623
31 December 2021 306,225,810
For the six months ended 30 June 2022, depreciation of right-of-use assets amounted to
RMB35,233,057 (the six months ended 30 June 2021: RMB7,354,220), of which
RMB31,995,045, RMB409,941, RMB2,398,822 and RMB429,249 were included in cost of
sales, selling and distribution expenses and administrative expenses and research and
development expenses, respectively (the six months ended 30 June 2021:
RMB3,554,214, RMB1,685,693, RMB1,599,215 and RMB515,098 were included in cost
of sales, selling and distribution expenses and administrative expenses and research and
development expenses, respectively).
57
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(16) Intangible assets
After-sales
services
Land use Software Non-patent management
rights licenses technologies mode Others Total
Cost
31 December 2021 755,093,373 255,342,587 779,747,498 36,979,184 1,599,516 1,828,762,158
Increase in the current
period
Transfer from - 2,222,727 - - - 2,222,727
construction in
progress
Internal research - - 153,791,760 - - 153,791,760
and development
Decrease in the
current period
Disposal (126,129,216) - - - - (126,129,216)
30 June 2022 628,964,157 257,565,314 933,539,258 36,979,184 1,599,516 1,858,647,429
Accumulated amortisation
31 December 2021 (186,339,168) (157,597,674) (333,557,694) (36,979,184) (1,599,516) (716,073,236)
Increase in the current
period
Provision (6,843,480) (16,006,277) (68,017,620) - - (90,867,377)
Decrease in the
current period
Disposal 59,866,980 - - - - 59,866,980
30 June 2022 (133,315,668) (173,603,951) (401,575,314) (36,979,184) (1,599,516) (747,073,633)
Provision for impairment
31 December 2021 - - (38,806,961) - - (38,806,961)
Increase in the current
period - - - - - -
Provision - - - - - -
30 June 2022 - - (38,806,961) - - (38,806,961)
Carrying amount
30 June 2022 495,648,489 83,961,363 493,156,983 - - 1,072,766,835
31 December 2021 568,754,205 97,744,913 407,382,843 - - 1,073,881,961
For the six months ended 30 June 2022, amortization charged to intangible assets amounted to
RMB90,867,377 (the six months ended 30 June 2021: RMB77,362,902), of which RMB24,071,
RMB223,566, RMB21,185,313 and RMB 69,434,427 were included in cost of sales, selling and
distribution expenses and administrative expenses and research and development expenses,
respectively(the six months ended 30 June 2021: RMB273,069, RMB 223,108,
RMB19,015,855, RMB57,850,870 were included in cost of sales, selling and distribution
expenses and administrative expenses and research and development expenses, respectively).
58
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(16) Intangible assets (Cont’d)
The Group's development expenditures are set out below:
Decrease in the current period
31 December Increase in the Recognised as
2021 current period intangible assets Write-off 30 June 2022
Automobile products
development project 111,004,350 229,954,476 - (153,791,761) 187,167,065
Expenditures on research and development of the Group incurred in the six months ended
30 June 2022 amounted to RMB896,948,849 (the six months ended 30 June 2021: RMB
776,879,828) in total, of which RMB666,994,373 (the six months ended 30 June 2021:
RMB726,466,190) was recognised in profit or loss for the current period, RMB62,429,052
(the six months ended 30 June 2021: RMB21,350,253) was recognised as intangible
assets for the current period and RMB167,525,424 (the six months ended 30 June 2021:
RMB29,063,385) was included in the ending balance of development expenditures. As at
30 June 2022, the intangible assets developed by the Group accounted for 46% (31
December 2021: 38%) of the carrying amount of intangible assets.
(17) Deferred tax assets and deferred tax liabilities
(a) Deferred tax assets before offsetting
30 June 2022 31 December 2021
Deductible temporary Deductible temporary
differences and Deferred tax differences and Deferred tax
deductible losses assets deductible losses assets
Accrued expenses and
provisions 4,894,124,853 1,105,178,720 4,820,934,400 1,096,537,713
Recoverable losses 2,250,486,206 375,006,112 1,878,611,797 282,043,452
Provision for asset
impairment 1,172,846,324 180,281,330 1,209,522,802 186,548,154
Non-patent technology 179,436,949 41,955,003 155,010,935 34,890,219
Employee education
funds unpaid 80,722,320 12,506,352 67,882,259 10,494,123
Retirement benefits plan 58,004,263 13,856,839 59,941,000 14,147,350
Deferred income 61,322,115 9,198,317 49,074,545 7,361,182
Others 168,432,008 28,023,500 138,426,727 23,420,738
8,865,375,038 1,766,006,173 8,379,404,465 1,655,442,931
Including:
Expected to be recovered
within 1 year (inclusive) 1,424,304,462 1,320,586,445
Expected to be
recovered after 1 year 341,701,711 334,856,486
1,766,006,173 1,655,442,931
59
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(17) Deferred tax assets and deferred tax liabilities (Cont’d)
(b) Deferred tax liabilities before offsetting
30 June 2022 31 December 2021
Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Depreciation of fixed assets 1,862,188,994 407,158,349 1,685,457,873 353,019,830
Net losses related to debt
exemption and equity
transactions between
parent and subsidiary 408,000,000 61,200,000 408,000,000 61,200,000
Differences between the fair
value of the identifiable net
assets and carrying
amount arising from
business combinations not
under common control 94,611,956 23,652,989 96,002,180 24,000,545
Amortisation of intangible
assets 49,812,059 9,684,611 45,631,805 7,847,331
Others - - 242,329 60,582
2,414,613,009 501,695,949 2,235,334,187 446,128,288
Including:
Expected to be recovered
within 1 year (inclusive) 123,934,808 116,988,634
Expected to be recovered
after 1 year 377,761,141 329,139,654
501,695,949 446,128,288
(c) Deductible temporary differences and deductible losses for which no deferred tax asset
was recognised are analysed as follows:
30 June 2022 31 December 2021
Deductible temporary differences 1,380,407,877 1,380,010,739
Deductible losses 156,106,747 108,539,538
1,536,514,624 1,488,550,277
(d) Deductible losses for which no deferred tax asset was recognised will be expired in
following years:
30 June 2022 31 December 2021
2024 109,336,011 108,539,538
2025 - -
2026 - -
2027 46,770,736 -
156,106,747 108,539,538
(e) The net balances of deferred tax assets and deferred tax liabilities after offsetting are as
follows:
30 June 2022 31 December 2021
Offsetting Balance after Offsetting Balance after
amount offsetting amount offsetting
Deferred tax assets (478,042,960) 1,287,963,213 (422,127,743) 1,233,315,188
Deferred tax liabilities (478,042,960) 23,652,989 (422,127,743) 24,000,545
60
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
(18) Other non-current assets
30 June 2022 31 December 2021
Long-term technology development
license fee 129,021,097 -
61
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(19) Provision for asset impairment and losses
31 December Increase in the Decrease in the current period 30 June 2022
2021 current period Reversal Write-off
Provision for bad debts of
accounts receivable 218,532,668 - (14,023,396) - 204,509,272
Including: Provision for bad
debts on the
individual basis 184,043,298 - (110,068) - 183,933,230
Provision for bad
debts on the
grouping basis 34,489,370 - (13,913,328) - 20,576,042
Provision for bad debts of other
receivables 1,036,560 2,118 (328,649) - 710,029
Provision for impairment of
long-term receivables 193,127 - (23,520) - 169,607
Sub-total 219,762,355 2,118 (14,375,565) - 205,388,908
Provision for inventories 76,739,821 - - (9,364,982) 67,374,839
Provision for impairment of
fixed assets 368,969,709 - - (12,898,832) 356,070,877
Provision for impairment of
construction in progress 691,646 - - - 691,646
Provision for impairment of
goodwill 89,028,412 - - - 89,028,412
Provision for impairment of
intangible assets 38,806,961 - - - 38,806,961
Sub-total 574,236,549 - - (22,263,814) 551,972,735
793,998,904 2,118 (14,375,565) (22,263,814) 757,361,643
62
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(20) Short-term borrowings
30 June 2022 31 December 2021
Credit loan 1,400,000,000 300,000,000
As at 30 June 2022, the interest rate for the short-term borrowings is between 2.05%-
2.85%(31 December 2021: 2.85%).
(21) Derivative financial liabilities
30 June 2022 31 December 2021
Derivative financial liabilities -
Forward exchange contracts 5,432,067 10,704,619
As at 30 June 2022 and 31 December 2021, derivative financial liabilities mainly
represented forward exchange contracts.
(22) Accounts payable
30 June 2022 31 December 2021
Payable for automobile parts 7,640,512,798 9,377,900,014
Payable for raw and auxiliary
materials 284,220,667 324,684,816
7,924,733,465 9,702,584,830
As at 30 June 2022, accounts payable with ageing over 1 year amounted to
RMB926,067,916 (31 December 2021: RMB747,156,926), which mainly represented
materials payable for which a settlement price had not yet been determined, and such
payables had not been finally settled yet.
63
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(23) Contract liabilities
30 June 2022 31 December 2021
Advances for automobiles and
automobile parts 82,088,388 223,779,674
Advances for maintenance and
warranty services 177,303,754 168,272,152
259,392,142 392,051,826
Less: Contract liabilities carried
forward to revenue after 1
year (Note 4(34)) (119,298,885) (119,777,649)
140,093,257 272,274,177
(24) Employee benefits payable
30 June 2022 31 December 2021
Short-term employee benefits
payable (a) 544,810,327 593,229,732
Defined contribution plans payable (b) 182,645,429 168,161,617
Defined benefit plans payable (c) 2,930,000 2,930,000
Termination benefits payable (d) 2,665,176 2,665,176
733,050,932 766,986,525
(a) Short-term employee benefits
31 December Increase in the Decrease in the
2021 current period current period 30 June 2022
Wages and salaries,
bonus, allowances,
and subsidies 465,474,414 915,767,461 (973,431,264) 407,810,611
Staff welfare 39,317,102 43,976,481 (44,610,876) 38,682,707
Social security
contributions 17,331,862 68,414,528 (72,052,242) 13,694,148
Including: Medical
insurance 13,375,711 63,555,055 (68,167,896) 8,762,870
Work injury
insurance 3,956,151 4,859,473 (3,884,346) 4,931,278
Housing funds 192,461 85,426,328 (85,231,010) 387,779
Labor union and
employee education
costs 70,913,893 33,606,817 (20,285,628) 84,235,082
Other short-term
employee benefits - 3,459,500 (3,459,500) -
593,229,732 1,150,651,115 (1,199,070,520) 544,810,327
64
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(24) Employee benefits payable (Cont'd)
(b) Defined contribution plans
Increase in Decrease in
31 December the current the current
2021 period period 30 June 2022
Basic pensions 163,081,887 136,653,545 (132,693,786) 167,041,646
Supplementary
pensions - 10,400,000 - 10,400,000
Unemployment
insurance 5,079,730 4,270,806 (4,146,753) 5,203,783
168,161,617 151,324,351 (136,840,539) 182,645,429
(c) Defined benefit plans
Increase in Decrease in
31 December the current the current
2021 period period 30 June 2022
Post-retirement
benefits
payable (Note
4(33)) 2,930,000 1,272,237 (1,272,237) 2,930,000
(d) Termination benefits payable
30 June 2022 31 December 2021
Early retirement benefits payable
(Note 4(33)) 1,327,000 1,327,000
Other termination benefits (i) 1,338,176 1,338,176
2,665,176 2,665,176
(i) For the six months ended 30 June 2022, other termination benefits paid by the Group for
termination of the employment relationship were RMB1,123,392.
(25) Taxes payable
30 June 2022 31 December 2021
Consumption tax payable 58,593,251 85,326,751
Enterprise income tax payable 54,447,546 170,084,881
Land use tax payable 4,589,474 6,174,129
Unpaid VAT 3,491,036 434,482
Others 16,388,891 25,151,477 19,278,5
137,510,198 287,171,720
65
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(26) Other payables
30 June 2022 31 December 2021
Promotion expenses 2,638,663,954 2,620,282,716
Research and development project
expenses 995,306,694 877,392,808
Construction payment 427,126,860 541,897,265
Ordinary share dividends payable 236,453,715 6,463,836
Transportation expenses 167,571,547 273,386,502
Advertising and new product
planning fees 149,506,863 138,500,269
Guarantees payable 124,949,518 131,123,402
Technological transformation project
expenses 55,894,428 61,104,696
Trademark license fee 14,692,296 15,572,521
Consulting fees 13,913,424 14,322,912
Others 760,000,420 573,753,878
5,584,079,719 5,253,800,805
As at 30 June 2022, other payables with ageing over 1 year of RMB1,378,347,472 (31
December 2021: RMB1,433,335,159) mainly comprised guarantees collected from logistics
companies, distributors and repair stations, payables for construction projects and
payables for research and development expenses. Such payables have not been finally
settled yet in view of the continuing business transactions with distributors and service
providers, and engineering projects and research and development projects that had not
yet been accepted and completed.
(27) Current portion of non-current liabilities
30 June 2022 31 December 2021
Current portion of lease liabilities
(Note 4(30)) 72,833,082 77,621,681
Current portion of long-term
borrowings (Note 4(29)) 439,490 417,507
73,272,572 78,039,188
(28) Other current liabilities
30 June 2022 31 December 2021
Provisions expected to be settled
within 1 year (Note 4(31)) 401,423,725 391,365,455
Others 10,671,491 29,091,358
412,095,216 420,456,813
66
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(29) Long-term borrowings
30 June 2022 31 December 2021
Guaranteed loans 2,417,197 2,505,044
Less: Current portion of long-term
borrowings (Note 4(27)) (439,490) (417,507)
1,977,707 2,087,537
The above guaranteed loans were long-term borrowings amounting to USD360,163
guaranteed by JMCF, borrowed from Industrial and Commercial Bank of China (“ICBC”),
Nanchang Ganjiang Sub-branch with interests paid every half year and the principal was
paid in instalments between 10 December 2007 and 27 October 2027. For the six months
ended 30 June 2022, the interest rate of long-term borrowings was 1.5% (For the Six
Months Ended 30 June 2021: 1.5%).
30 June 2022 31 December 2021
Amount in Amount in
Starting Maturity Interest foreign RMB foreign RMB
date date Currency rate (%) currency equivalent currency equivalent
ICBC Nanchang
Ganjiang Sub- 27 February 27 October
branch 1998 2027 USD 1.5% 360,163 2,417,197 392,905 2,505,044
(30) Lease liabilities
30 June 2022 31 December 2021
Lease liabilities 266,906,485 341,031,095
Less: Current portion of non-
current liabilities (Note
4(27)) (72,833,082) (77,621,681)
194,073,403 263,409,414
(a) As at 30 June 2022, the Group has no leases that are not included in lease liabilities but will
result in potential future cash outflows.
(b) As at 30 June 2022, Group has no signed short-term lease and low-value asset lease
contracts that are simplified in accordance with the new lease standards..
67
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(31) Provisions
Increase in Decrease in
31 December the current the current
2021 period period 30 June 2022
Product warranties i) 569,247,478 195,277,051 (173,771,731) 590,752,798
Provision for contracts 19,705,141 - (830,735) 18,874,406
588,952,619 195,277,051 (174,602,466) 609,627,204
Less: Provisions
expected to
be settled
within 1 year
(Note 4(28)) (391,365,455) (401,423,725)
197,587,164 208,203,479
i) Product warranties are expenses expected to be incurred during the warranty period from free
after-sales services, product warranty and other services for the vehicles sold.
(32) Deferred income
Increase in Decrease in
31 December the current the current 30 June
2021 period period 2022 Reason
Government Subsidy for
grants (a) 49,074,545 12,475,000 (227,430) 61,322,115 projects
(a) Government grants
31 Increase in Recognised in
December the current other income in 30 June Asset related/
2021 period the current period 2022 Income related
Research and
development-
related
subsidies 48,170,026 1,000,000 (93,204) 49,076,822 Income related
Assets -related
subsidies - 11,275,000 (134,226) 11,140,774 assets -related
Others 904,519 200,000 - 1,104,519 Income related
49,074,545 12,475,000 (227,430) 61,322,115
68
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(33) Long-term employee benefits payable
30 June 2022 31 December 2021
Supplementary retirement benefits
and early-retirement benefits
eligible for recognition of provisions 58,004,263 59,941,000
Less: Payable within 1 year (4,257,000) (4,257,000)
53,747,263 55,684,000
The retirement and early-retirement benefits payable within one year are included in
employee benefits payable (Note 4(24)(c), (d)).
For retired and early-retired employees, the Group provides them with a certain amount of
supplementary benefits during their retirement or early-retirement period. The amount of
benefits depends on the employee's position, length of service and salary at the time of
retirement or early-retirement, and is adjusted in accordance with inflation rate and other
factors. The Group's obligations for supplementary retirement and early-retirement benefits
as at the balance sheet date were calculated using projected unit credit method and were
reviewed by an external independent actuary.
(a) Movements of retirement and early-retirement benefits of the Group are as follows:
Present value of the obligations of the defined
benefit plan
30 June 2022 31 December 2021
Opening balance 59,941,000 67,587,000
Cost of defined benefit plans
recognised in profit or loss for the
current period
- Current service cost - 1,346,000
- Past service cost - (14,664,000)
- Actuarial losses/(gains) recognised -
immediately 800,000
- Net interest - 2,463,000
Remeasurement of net liabilities for
defined benefit plans
- Actuarial losses - 6,218,000
Other movements
- Benefits paid (1,936,737) (3,809,000)
Ending balance 58,004,263 59,941,000
69
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(33) Long-term employee benefits payable (Cont'd)
(b) The actuarial assumptions used to determine the present value of defined benefit plan
obligations
30 June 2022 31 December 2021
Discount rate 3.00% 3.00%
Inflation rate 2.00% 2.00%
Salaries and benefits growth
rates 0%-6% 0%-6%
Future mortality assumptions were determined based on the China Life Insurance Mortality
Table (2010-2013), which is publicly available statistical information for the Chinese region.
(34) Other non-current liabilities
30 June 2022 31 December 2021
Contract liabilities carried forward to
revenue after one year (Note
4(23)) 119,298,885 119,777,649
70
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Share capital
Movements for the current period
31 December Shares Transfer
30 June 2022
2021 newly Bonus from capital
issued share surplus Others Sub-total
Shares subject to trading
restriction -
Other domestic shares
Including: Shares held by
domestic non-state-
owned legal
persons 745,140 - - - - - 745,140
Shares held by domestic
natural persons 5,700 - - - 20 - 5,720
750,840 - - - 20 - 750,860
Shares not subject to trading
restriction -
Ordinary shares denominated in
RMB 518,463,160 - - - (20) - 518,463,140
Domestically listed foreign
shares 344,000,000 - - - - - 344,000,000
862,463,160 - - - (20) - 862,463,140
863,214,000 - - - - - 863,214,000
Since the implementation of the Company's Scheme on Share Split Reform on 13 February 2006, As at 30 June 2022, there were 750,860 shares
currently unavailable for trading. During the reporting period, there was no shares with trading restrictions were released from the restricted
conditions.
71
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Share capital (Cont’d)
Movements for the current year
31 December Shares Transfer 31 December
2020 newly Bonus from capital 2021
issued share surplus Others Sub-total
Shares subject to trading
restriction -
Other domestic shares
Including: Shares held by
domestic non-state-
owned legal
persons 745,140 - - - - - 745,140
Shares held by domestic
natural persons 5,700 - - - - - 5,700
750,840 - - - - - 750,840
Shares not subject to trading
restriction -
Ordinary shares denominated in
RMB 518,463,160 - - - - - 518,463,160
Domestically listed foreign
shares 344,000,000 - - - - - 344,000,000
862,463,160 - - - - - 862,463,160
863,214,000 - - - - - 863,214,000
72
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(36) Capital surplus
Increase in Decrease in
31 December the current the current
2021 period period 30 June 2022
Share premium 816,609,422 - - 816,609,422
Other capital surplus 22,833,068 - - 22,833,068
839,442,490 - - 839,442,490
Increase in Decrease in
31 December the current the current 31 December
2020 year year 2021
Share premium 816,609,422 - - 816,609,422
Other capital surplus 22,833,068 - - 22,833,068
839,442,490 - - 839,442,490
73
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(37) Other comprehensive income
Other comprehensive income in the Other comprehensive income in the income statement for
balance sheet the six months ended 30 June 2022
Amount
incurred Less: Transfer-
before out of previous
Attributable income tax other Attributable
31 to the parent for the comprehensive Less: to the parent
December company 30 June current income in the Income tax company
2021 after tax 2022 period current period expenses after tax
Other comprehensive income items which
will not be reclassified to profit or loss
Actuarial gains on defined benefit plans (16,422,750) - (16,422,750) - - - -
Other comprehensive income in the Other comprehensive income in the income statement for
balance sheet the year ended 31 December 2021
Amount Less: Transfer-
incurred out of previous
Attributable before other Attributable
31 to the parent 31 income tax comprehensive Less: to the parent
December company December for the income in the Income tax company
2020 after tax 2021 current year current year expenses after tax
Other comprehensive income items which
will not be reclassified to profit or loss
Actuarial gains on defined benefit plans (11,759,250) (4,663,500) (16,422,750) (6,218,000) - 1,554,500 (4,663,500)
74
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(38) Surplus reserve
31 December Increase in the Decrease in the
2021 current period current period 30 June 2022
Statutory surplus reserve 431,607,000 - - 431,607,000
31 December Increase in the Decrease in the 31 December
2020 current year current year 2021
Statutory surplus reserve 431,607,000 - - 431,607,000
In accordance with the Company Law of the People's Republic of China, the Company’s
Articles of Association and the resolution of the Board of Directors, the Company should
appropriate 10% of net profit for the year to the statutory surplus reserve, and the Company
can cease appropriation when the statutory surplus reserve accumulated to more than 50%
of the registered capital. The statutory surplus reserve can be used to make up for the loss
or increase the share capital upon approval from the appropriate authorities. As the
accumulated appropriation to the statuary surplus reserve exceeded 50% of the registered
capital, no appropriation was made in the current period (2021: Nil).
The Company reserves the discretionary surplus reserve after the shareholders’ meeting
approves the proposal from the Board of Directors. The discretionary surplus reserve can
be used to compensate for the losses incurred in prior years or increase the share capital
upon approval from appropriate authorities.
(39) Retained earnings
Six months ended 30 June
2022 2021
Retained earnings at the beginning of the
year 6,437,603,849 8,863,969,769
Add: Net profit attributable to
shareholders of the parent
company for the current period 452,381,022 405,214,055
Less: Ordinary share dividends payable
(a) (229,614,924) (3,000,531,864)
Retained earnings at the end of the year 6,660,369,947 6,268,651,960
(a) According to the resolution of the meeting of board of directors on 28 March 2022, the
board of directors propose to distribute cash dividends of RMB0.266 per share to all
shareholders, calculated on the basis of 863,214,000 issued shares, for a total of
RMB229,614,924，and the proposal was approved by the shareholders' meeting on June
24, 2022
.
(40) Minority interests
30 June 2022 31 December 2021
Minority shareholders' equity attributable
to minority shareholders of
subsidiary Jiangling Ford Technology 18,542,360 -
75
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(41) Revenue and cost of sales
Six months ended 30 June
2022 2021
Revenue from main operations 13,987,205,046 17,360,624,109
Revenue from other operations 235,554,338 314,996,979
14,222,759,384 17,675,621,088
Six months ended 30 June
2022 2021
Cost of sales from main operations 12,109,195,653 14,756,422,659
Cost of sales from other operations 221,906,101 293,802,060
12,331,101,754 15,050,224,719
(a) Revenue and cost of sales from main operations
Six months ended 30 June
2022 2021
Revenue from Cost of revenue Revenue from Cost of revenue
main operations from main main operations from main
operations operations
Sales of
automobiles 12,865,705,605 11,244,951,198 16,283,174,183 13,950,596,206
Sales of
automobile
parts 1,060,688,066 803,494,300 1,023,854,381 747,849,973
Automobile
maintenance
services,etc. 60,811,375 60,750,155 53,595,545 57,976,480
13,987,205,046 12,109,195,653 17,360,624,109 14,756,422,659
(b) Revenue and cost of sales from other operations
Six months ended 30 June
2022 2021
Revenue from Cost of sales from Revenue from Cost of sales from
other operations other operations other operations other operations
Sales of
materials 191,061,332 178,388,921 257,593,313 238,590,185
Others 44,493,006 43,517,180 57,403,666 55,211,875
235,554,338 221,906,101 314,996,979 293,802,060
76
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(41) Revenue and cost of sales (Cont’d)
(c) The Group's revenue is broken down as follows:
Six months ended 30 June 2022
Automobiles Automobile parts Automobile Materials and Total
maintenance others
services
Revenue from main
operations 12,865,705,605 1,060,688,066 50,406,375 10,405,000 13,987,205,046
Including: Recognised at
a time point 12,865,705,605 1,060,688,066 - 10,405,000 13,936,798,671
Recognised
within a
certain
period - - 50,406,375 - 50,406,375
Revenue from other
operations - - - 235,554,338 235,554,338
12,865,705,605 1,060,688,066 50,406,375 245,959,338 14,222,759,384
Six months ended 30 June 2021
Automobiles Automobile parts Automobile Materials and Total
maintenance others
services
Revenue from main
operations 16,283,174,183 1,023,854,381 53,595,545 - 17,360,624,109
Including: Recognised at
a time point 16,283,174,183 1,023,854,381 - - 17,307,028,564
Recognised
within a
certain
period - - 53,595,545 - 53,595,545
Revenue from other
operations - - - 314,996,979 314,996,979
16,283,174,183 1,023,854,381 53,595,545 314,996,979 17,675,621,088
(i) As at 30 June 2022, the amount of revenue corresponding to the performance obligations that
the Group has signed but has not performed or has not yet performed is RMB259,392,142,
which was expected to be recognised between 2022 and 2027.
(42) Taxes and surcharges
Six months ended 30 June
2022 2021
Consumption tax 287,322,632 366,921,695
City construction and maintenance tax 36,012,229 46,652,034
Educational surcharge 34,946,861 42,987,981
Land use tax 11,981,547 9,534,267
Real estate tax 11,253,617 8,736,554
Stamp duty 8,049,599 4,155,789
Others 259,959 253,194
389,826,444 479,241,514
77
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(43) Selling and distribution expenses
Six months ended 30 June
2022 2021
Promotion expenses 206,589,048 241,079,452
Warranties 195,277,051 238,355,518
Employee benefits 106,274,641 96,986,506
Advertising and
new product planning fees 89,719,606 139,947,287
Storage expenses 24,386,326 30,124,253
Packaging material expenses 16,349,345 18,318,542
Sales network
construction expenses 2,089,221 122,520,260
Depreciation and amortisation
expenses 1,774,580 2,917,619
Others 54,198,604 59,264,981
696,658,422 949,514,418
(44) General and administrative expenses
Six months ended 30 June
2022 2021
Employee benefits 262,789,333 303,656,754
Depreciation and amortisation
expenses 71,094,821 84,531,170
Trademark license fee 29,184,964 22,232,060
Repair expenses 13,075,304 6,143,557
Consulting expenses 8,748,003 13,339,805
General office expenses 7,077,300 10,744,528
Cartage fee 5,001,516 20,427,458
Others 55,085,745 68,742,208
452,056,986 529,817,540
(45) Research and development expenses
Six months ended 30 June
2022 2021
Employee benefits 250,946,160 273,546,646
Design fee 107,366,166 93,888,283
Depreciation and amortisation
expenses 102,675,938 90,393,420
Technology development expenses 96,028,487 123,421,584
Materials expenses 61,555,048 72,889,999
Others 48,422,574 72,326,258
666,994,373 726,466,190
78
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(46) Financial expenses
Six months ended 30 June
2022 2021
Interest costs 21,269,478 13,014,765
Add: Interest costs on lease
liabilities 6,857,573 878,444
Less: Government grants - (1,760,125)
Interest expenses 28,127,051 12,133,084
Less: Interest income from cash at
bank (107,825,929) (142,004,807)
Fund occupation fee (a) (1,297,161) (7,142,858)
Other interest income (7,029,072) -
Interest income (116,152,161) (149,147,665)
Exchange gains or losses 7,477,127 (8,772,108)
Others 350,632 344,402
(80,197,351) (145,442,287)
(a) The fund occupation fee is the fee paid to the Group at the rate agreed by both parties
when the distributors delay payment or settle with a bill of exchange.
(47) Expenses by nature
The cost of sales, selling and distribution expenses, general and administrative expenses
and research and development expenses in the income statement are listed as follows by
nature:
Six months ended 30 June
2022 2021
Changes in inventories of finished
goods and work in progress 278,486,607 201,864,808
Consumed raw materials, low value
consumables, etc. 10,797,906,093 13,230,742,782
Employee benefits 1,303,098,857 1,370,346,825
Depreciation of fixed assets 435,117,387 433,395,705
Amortisation of intangible assets 90,867,377 77,362,902
Depreciation of right-of-use assets 35,233,057 7,354,220
Transportation expenses 316,638,202 424,338,871
Warranties 195,277,051 238,355,518
Promotion expenses 206,589,048 241,079,452
Advertising and new product
planning fees 89,719,606 139,947,287
Design fee 107,366,166 93,888,283
Research and development
expenses 96,028,487 123,421,584
Fixed asset repair and maintenance
expenses (a) 20,438,204 63,661,306
Others 174,045,393 610,263,324
14,146,811,535 17,256,022,867
79
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(47) Expenses by nature (Cont’d)
(a) The Group includes daily maintenance expenses ineligible for the capitalisation of fixed
assets regarding the production and processing of inventories into cost of inventories,
which will be carried forward to cost of sales, and those regarding the R&D Department,
Administrative Department, and Sales Department are included in research and
development expenses, management expenses and selling and distribution expenses
respectively.
(48) Credit impairment losses
Six months ended 30 June
2022 2021
Losses on bad debts of accounts
receivable (14,023,396) (7,566,557)
Losses on bad debts of other
receivables (326,531) 177,179
Losses on bad debts of long-term
receivables (23,520) -
(14,373,447) (7,389,378)
(49) Other income
Six months ended 30 June
Assets related/
2022 2021 Income related
Equipment
procurement
related subsidies 134,226 - Assets related
Research and
development
activities related
subsidies 93,204 9,227,727 Income related
Subsidy for operating
activities 260,831,804 324,065,109 Income related
261,059,234 333,292,836
80
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(50) Investment income
Six months ended 30 June
2022 2021
Investment income from financial assets
held for trading 1,523,836 10,204,592
Losses on discount of financing receivables
eligible for derecognition (8,585,648) (13,053,249)
Losses on long-term equity investments
under equity method (4,151,633) (264,201)
Investment loss from forward exchange
settlement (10,728,178) (7,750,384)
(21,941,623) (10,863,242)
There is no significant restriction on the remittance of investment income of the Group.
(51) Gains on changes in fair value
Six months ended 30 June
2022 2021
Financial assets at fair value through profit or loss -
Structural deposits (242,329) (681,478)
Derivative financial assets and derivative financial
liabilities -
Forward exchange contracts 5,272,552 (4,449,015)
5,030,223 (5,130,493)
(52) Gains on disposal of assets
Six months ended 30 June Amount recognised in
non-recurring profit or
loss for the six months
2022 2021 ended 30 June 2022
Income from disposal of
land and above ground
buildings of Qingyunpu
factory 394,117,791 - 394,117,791
Gains on disposal of other
assets 1,443,509 11,152,182 1,443,509
395,561,300 11,152,182 395,561,300
81
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(53) Non-operating income
Six months ended 30 June
Amount recognised in
non-recurring profit or
loss for the six
months ended 30
2022 2021 June 2022
Compensation and 1,933,841 1,520,395 1,933,841
penalty income
Others 85,687 989,882 85,687
2,019,528 2,510,277 2,019,528
(54) Non-operating expenses
Six months ended 30 June
Amount recognised
in non-recurring profit
or loss for the six
months ended 30
2022 2021 June 2022
Losses on scrapping and
disposal of assets 249,038 143,574 249,038
Donations 5,280 1,995,000 5,280
Others 252,100 446,408 252,100
506,418 2,584,982 506,418
(55) Income tax expenses
Six months ended 30 June
2022 2021
Current income tax calculated based
on tax law and related regulations (37,967,101) 165,333,174
Deferred income tax 37,958,166 (148,982,279)
(8,935) 16,350,895
82
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(55) Income tax expenses (Cont’d)
The reconciliation from income tax calculated based on the applicable tax rates and total
profit presented in the consolidated income statement to the income tax expenses is listed
below:
Six months ended 30 June
2022 2021
Total profit 421,914,447 421,564,950
Income tax calculated at applicable tax rates 40,560,200 49,035,811
Effect of change in the tax rates 25,295,893 14,052,432
Tax credit (1,487,861) -
Additional deductions (76,963,987) (73,910,521)
Non-taxable loss 622,745 39,630
Equity transactions and debt exemption
between parent and subsidiary - 25,985,873
Costs, expenses and losses not deductible
for tax purposes 161,737 15,530,448
Utilisation of previously unrecognised
deductible temporary differences - (663,003)
Deductible temporary differences of
unrecognized deferred income tax assets
in the current period 109,654 -
Utilisation of the deductible loss of the
unrecognized deferred tax asset in the
previous period - (13,719,775)
Deductible losses for which no deferred tax
asset was recognised in the current
period 11,692,684 -
Income tax expenses (8,935) 16,350,895
(56) Earnings per share
(a) Basic earnings per share
Basic earnings per share are calculated by dividing consolidated net profit attributable to
ordinary shareholders of the parent company by the weighted average number of
outstanding ordinary shares of the parent company:
Six months ended 30 June
2022 2021
Consolidated net profit attributable to ordinary
shareholders of the parent company 452,381,022 405,214,055
Weighted average number of ordinary shares
outstanding issued by the Company 863,214,000 863,214,000
Basic earnings per share 0.52 0.47
(b) Diluted earnings per share
Diluted earnings per share are calculated by dividing consolidated net profit attributable to
ordinary shareholders of the parent company adjusted based on the dilutive potential
ordinary shares by the adjusted weighted average number of outstanding ordinary shares
of the Company. As there were no dilutive potential ordinary shares For the six months
ended 30 June 2022 (six months ended 30 June 2021: Nil), diluted earnings per share
equalled to basic earnings per share.
83
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(57) Notes to the cash flow statement
(a) Cash received relating to other operating activities
Six months ended 30 June
2022 2021
Government grants 273,306,804 334,382,070
Guarantees from distributors 32,972,688 78,002,972
Others 38,745,069 38,573,891
345,024,561 450,958,933
(b) Cash paid relating to other operating activities
Six months ended 30 June
2022 2021
Research and development
expenses 425,248,558 271,562,707
Promotion expenses 304,676,243 185,146,657
Warranties 193,444,885 216,744,709
Advertising expenses 83,599,440 113,004,161
Guarantees 38,337,255 49,908,699
Maintenance expenses 34,587,032 44,654,150
Travelling expenses 12,680,227 17,919,914
Others 263,731,525 336,429,854
1,356,305,165 1,235,370,851
(c) Cash received relating to other investing activities
Six months ended 30 June
2022 2021
Interest from cash at bank 115,825,204 116,825,862
Interest from credit sales 4,941,671 1,020,809
Interest from acceptance notes 3,971,074 4,895,325
Investment income from forward
exchange settlement 729,231 79,024
125,467,180 122,821,020
84
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(57) Notes to the cash flow statement (Cont’d)
(d) Cash paid relating to other financing activities
Six months ended 30 June
2022 2021
Payments of lease liabilities 6,754,924 4,409,423
(58) Supplementary information to the cash flow statement
(a) Supplementary information to the cash flow statement
Reconciliation from net profit to cash flows from operating activities
Six months ended 30 June
2022 2021
Net profit 421,923,382 405,214,055
Add: Provision for credit impairment
(Note 4(48)) (14,373,447) (7,389,378)
Depreciation of fixed assets (Note
4(13)) 435,117,387 433,395,705
Amortisation of intangible assets
(Note 4(16)) 90,867,377 77,362,902
Depreciation of right-of-use assets
(Note 4(15)) 35,233,057 7,354,220
Increase in provisions (Note 4(31)) 20,674,585 36,150,011
Gain on disposal of long-term
assets (395,312,262) (11,008,608)
Financial expenses (80,553,800) (145,788,789)
Investment income (Note 4(50)) 21,941,623 10,863,242
Losses /(Gains) on changes in fair
value (Note 4(51)) (5,030,223) 5,130,493
Increase in deferred tax assets (54,648,025) (164,226,685)
(Decrease)/Increase in deferred tax
liabilities (347,556) 15,244,406
Decrease/(Increase) in inventories 47,455,534 (139,999,996)
Increase in other cash and cash
equivalents - (1,565,665)
Increase in operating receivables (1,823,060,996) (279,516,996)
Decrease in operating payables (2,031,433,111) (171,301,068)
Net cash flows from operating activities (3,331,546,475) 69,917,849
85
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(58) Supplementary information to the cash flow statement (Cont’d)
(a) Supplementary information to the cash flow statement (Cont’d)
Net increase/(decrease) in cash and cash equivalents
Six months ended 30 June
2022 2021
Cash and cash equivalents
at the end of the year 7,799,258,684 10,948,621,070
Less: Cash and cash equivalents at the
beginning of the year (9,569,051,314) (11,121,955,129)
Net increase in cash
and cash equivalents (1,769,792,630) (173,334,059)
(b) Cash and cash equivalents
30 June 2022 31 December 2021
Cash at bank available for payment at any
time 7,799,258,684 9,569,051,314
86
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(59) Foreign currency monetary items
30 June 2022
Amounts foreign Translation
currencies exchange rate Amounts in RMB
Long-term borrowings -
USD 360,163 6.7114 2,417,197
Other payables -
USD 27,846,205 6.7114 186,887,018
EUR 33,288 7.0084 233,296
187,120,314
5 Changes in the scope of consolidation (Cont’d)
(1) Set up of subsidiaries
In 2021, the Company and Ford Motor Company (“Ford”) subscribed to the capital
contribution of RMB102,000,000 and 98,000,000 respectively to set up Jiangling Ford
Technology, the total registered capital subscribed amount to RMB200,000,000. The
Company holds 51% of the shares of Jiangling Ford Technology and got the control of
Jiangling Ford Technology’s Board of Shareholders and Directors. Jiangling Ford Technology
is the holding subsidiary of the Company.
As of June 30, 2022 the industrial and commercial registration of Jiangling Ford Technology
has been completed and has been put into operation; The paid in capital of the company
and Ford is RMB51,000,000 and RMB49,000,000 respectively.
(2) Disposal of subsidiaries
In 2021, the company transferred 60% of the 100% equity of the power company to Yunnei
group, and the date of loss of control is November 5, 2021. As of June 30, 2022, the group
has received RMB171,700,000 of equity purchase payment from Yunnei group, and the
remaining receivables of RMB188,300,000 are listed in other receivables (note 4 (7)).
87
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
6 Equity in other entities
(1) Equity in subsidiaries
(a) Structure of the Group
Subsidiaries Main place of Place of Nature of business Shareholding (%) Method of acquisition
business registration Direct Indirect
Nanchang, Nanchang, Retail, wholesale and lease of
JMCS Jiangxi Jiangxi automobiles 100% - Set up by investment
Business combinations
Taiyuan, Taiyuan, involving enterprises not
JMCH(i) Shanxi Shanxi Manufacture and sales of automobiles 100% - under common control
Shenzhen, Shenzhen,
SZFJ Guangdong Guangdong Retail, wholesale and lease of automobiles 100% - Set up by investment
Guangzhou, Guangzhou,
GZFJ Guangdong Guangdong Retail, wholesale and lease of automobiles 100% - Set up by investment
Jiangling Ford Technology Sales of automobiles, technical and
(Note 5(1)) Shanghai Shanghai business information consultation 51% - Set up by investment
(i)According to the resolution of Board of Directors held from April 30 to May 6, 2021, the Company sold 100% equity of JMCH held by the Company through
Shanxi Property Rights Exchange at a price of not less than RMB764,069,207. On August 9, 2021, the listing announcement period has expired and Volvo
Lastvagnar Aktiebolag became the intended transferee for the equity transaction. On August 23, 2021, the Company and Volvo Lastvagnar Aktiebolag
reached an agreement through negotiation and signed the "Equity Transaction Agreement on 100% Equity of Jiangling Heavy Duty Truck Co., Ltd.". The
benchmark price for equity transfer is RMB781,400,000. As of June 30, 2022, the equity transaction is still under approval by the relevant state departments.
88
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
6 Equity in other entities (Cont’d)
(1) Equity in subsidiaries (Cont’d)
(b) Subsidiaries with significant minority interests
Six months ended 30 June 2022
Minority shareholders Gains/(losses) attributable to Dividends distributed to minority June 30 2022
Shareholding (%) minority shareholders shareholders Minority interests
Name of subsidiary
Jiangling Ford Technology 49% (30,457,640) - 18,542,360
The main financial information of the above important non wholly owned subsidiaries is listed below：
June 30 2022
Current assets Non-current assets Total assets Current liabilities Non-current liabilities Total liabilities
Jiangling
Ford
Technology 287,695,590 63,021,800 350,717,390 312,875,838 - 312,875,838
Six months ended 30 June 2022
Revenue Net profit Total comprehensive income Operating activities cash flow
Jiangling
Ford
Technology 216,918,799 (62,158,449) (62,158,449) 52,740,308
89
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
6 Equity in other entities (Cont’d)
(2) Equity in associates
(a) General information of significant associates
Shareholding (%)
Place of registration Direct Indirect
Associates -
The Power Company Taiyuan City, Shanxi Province 40% -
The above equity investments are accounted for using the equity method by the Group.
(b) Summarised financial information for significant associates
30 June 2022
The Power Company
Current assets 174,628,241
Non-current assets 417,797,052
Total assets 592,425,293
Current liabilities 63,389,614
Non-current liabilities 60,855
Total liabilities 63,450,469
Minority interests 211,589,930
Attributable to shareholders of the parent company 317,384,894
Shares of net assets based on shareholding (i) 211,589,930
Adjustments
- Unrealised profits arising from internal
transactions (15,607,561)
- Others (ii) 20,853,323
Carrying amount of equity investments in
associates 216,835,692
Six months ended 30 June 2022
The Power Company
Revenue 40,592,217
Net loss (11,009,189)
Other comprehensive
income -
Total comprehensive loss (11,009,189)
Dividends received from
associates by the Group -
90
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
6 Equity in other entities (Cont’d)
(2) Equity in associates (Cont’d)
(b) Summarised financial information for significant associates(Cont’d)
(i) The Group calculated the shares of assets in proportion of the shareholdings and based on the
amount attributable to the parent company of the associates in their consolidated financial
statements. The amount in the consolidated financial statements of associates considers the
impacts of fair value of identifiable assets and liabilities of associates at the time of acquisition and
the unification of accounting policies. None of the assets involved in transactions between the Group
and associates contribute to business.
(ii) Other adjustments were mainly the remeasurement for fair value of remaining equity in the
consolidated financial statements, which resulted from the loss of control over the original subsidiary
due to the disposal of part of the equity investment.
(c) Summarised information of insignificant associates
Six months ended 30 June
2022 2021
Aggregated carrying amount of investments 36,263,930 39,232,347
Aggregate of the following items in proportion
Net profit (i) (144,710) (264,201)
Other comprehensive income (i) - -
Total comprehensive income (144,710) (264,201)
(i) The net profit and other comprehensive income have taken into account the impacts of both the
fair value of the identifiable assets and liabilities upon the acquisition of investment in joint ventures
and associates and the unification of accounting policies adopted by the joint ventures and the
associates to those adopted by the Group.
91
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Segment information
Revenue and profits of the Company mainly arise from production and domestic sales of
automobiles, and the primary assets of the Group are all located in China. Management of the
Group assesses the operating performance of the Group as a whole. Therefore, no segment
report is prepared for the current period.
8 Related parties and related party transactions
(1) Information of major shareholders
(a) General information of major shareholders
Type of Place of Legal Code of
enterprise registration representative Nature of business organisation
State-
owned Nanchang, Investment and 91360125MA38LU
JIC enterprise China Qiu Tiangao asset management R91F
Foreign United William Clay Manufacture and
Ford enterprise States Ford, Jr. sales of automobiles N/A
(b) Registered capital and changes in major shareholders
31 December Increase in the Decrease in the 30 June
2021 current period current period 2022
JIC 1,000,000,000 - - 1,000,000,000
Ford USD 41,000,000 - - USD 41,000,000
(c) The percentages of shareholding and voting rights in the Company held by major
shareholders
30 June 2022 31 December 2021
Shareholding Voting rights Shareholding Voting rights
(%) (%) (%) (%)
JIC 41.03% 41.03% 41.03% 41.03%
Ford 32% 32% 32% 32%
(2) Information of subsidiaries
The general information and other related information of subsidiaries are set out in Note
6(1).
(3) Information of associates
The information of associates is set out in Note 4(12).
92
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(4) Information of other related parties
Relationship with the Group
JMCG Shareholder of JIC
Chongqing Changan Automobile Co., Ltd. Shareholder of JIC
JMCG Jingma Motors Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi Lingrui Recycling Resources Development
Wholly-owned subsidiary of JMCG
Corporation
Nanchang Gear Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangling Material Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi JMCG Industry Co., Ltd. Wholly-owned subsidiary of JMCG
JMCG Property Management Co. Wholly-owned subsidiary of JMCG
Jiangxi Jiangling Chassis Co., Ltd. Holding subsidiary of JMCG
Nanchang JMCG Shishun Logistics Co., Ltd. Holding subsidiary of JMCG
JMCF Holding subsidiary of JMCG
Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. Holding subsidiary of JMCG
Nanchang JMCG Xinchen Auto Component Co., Ltd. Holding subsidiary of JMCG
Jingdezhen Shishun Logistics Co., Ltd. Holding subsidiary of JMCG
Jiangxi Jiangling group Fuxin Auto Parts Co., Ltd Holding subsidiary of JMCG
Jiangxi Mingfang Auto Parts Industry Co., Ltd Holding subsidiary of JMCG
Ford Global Technologies,LLC Wholly-owned subsidiary of Ford
Ford Trading Company LLC Wholly-owned subsidiary of Ford
Ford Motor (China) Co., Ltd. Wholly-owned subsidiary of Ford
Ford Motor Research & Engineering (Nanjing) Co., Ltd. Wholly-owned subsidiary of Ford
Ford Motor Co. Thailand Ltd. Wholly-owned subsidiary of Ford
Ford Otomotiv Sanayi A.S. Holding subsidiary of Ford
Auto Alliance (Thailand) Co., Ltd. Holding subsidiary of Ford
Ford Vietnam Limited Holding subsidiary of Ford
Changan Ford Automobile Co., Ltd. Joint venture of Ford
Nanchang JMCG Frame Co., Ltd Subsidiary under indirect control of JMCG
Nanchang JMCG Liancheng Auto Component Co., Ltd. Subsidiary under indirect control of JMCG
Nanchang Lianda Machinery Co., Ltd. Subsidiary under indirect control of JMCG
Jiangling Aowei Automobile Spare Part Co., Ltd. Subsidiary under indirect control of JMCG
Jiangxi JMCG Boya brake system Co., Ltd Subsidiary under indirect control of JMCG
Jiangxi JMCG Shangrao Industrial Co., Ltd. Subsidiary under indirect control of JMCG
JMCG Jiangxi Engineering Construction Co., Ltd. Subsidiary under indirect control of JMCG
Nanchang Gear Forging Co.,Ltd. (i) Subsidiary under indirect control of JMCG
Jiangxi ISUZU Automobile Sales service Co., Ltd. Subsidiary under indirect control of JMCG
Guizhou Wanfu Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
Chongqing Anfu Vehicle Marketing Co., Ltd. Group subsidiary of JIC’s shareholder
Chengdu Wanxing Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
Chongqing Anbo Vehicle Sales Co., Ltd. Group subsidiary of JIC’s shareholder
Yunan Wanfu Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
Dali Wanfu Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
93
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(4) Information of other related parties (Cont'd)
Relationship with the Group
Beijing Beifang Changfu Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
China Changan Group Hefei Investing Co., Ltd. Group subsidiary of JIC’s shareholder
Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
China Changan Group Tianjin Sales Co., Ltd. Group subsidiary of JIC’s shareholder
Guizhou Wanjia Automobile Sales and Service Co. LTD Group subsidiary of JIC’s shareholder
Anhui Wanyou Automobile Sales service Co. LTD Group subsidiary of JIC’s shareholder
Honghe Wanfu Vehicle Sales & Service Co., Ltd. Group subsidiary of JIC’s shareholder
Jiangxi Jiangling Lear Interior System Co., Ltd. Joint venture of JMCG
Jiangxi ISUZU Co., Ltd. Joint venture of JMCG
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Joint venture of JMCG
Nanchang Unistar Electric & Electronics Co., Ltd. Joint venture of JMCG
Nanchang Yinlun Heat-exchanger Co., Ltd. Joint venture of JMCG
Jiangxi ISUZU Engine Co., Ltd. Joint venture of JMCG
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Associate of JMCG
Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. Associate of JMCG
Jiangxi JMCG Specialty Vehicles Co., Ltd. Associate of JMCG
Jiangxi Jiangling Group Special Vehicle Co., Ltd. Associate of JMCG
Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. (ii) Associate of JMCG
Nanchang Baojiang Steel Processing Distribution Co., Ltd. Associate of JMCG
Magna PT Powertrain (Jiangxi) Co., Ltd. Associate of JMCG
Faurecia Emissions Control Technologies (Nanchang) Co.,
Associate of JMCG
Ltd.
Jiangling Motor Holdings Co., Ltd. Associate of JMCG
Jiangxi Lingyun Automobile Industry Technology Co.,Ltd Associate of JMCG
Nanchang Hengou Industry Co., Ltd. Associate of JMCG
Jiujiang Fuwantong Vehicle Co., Ltd. Associate of JMCG
Jiangxi Fuxiang Vehicle Co., Ltd. Associate of JMCG
Jiangxi Jiangling Overseas Automobile Sales and Service
Associate of JMCG
Co., Ltd.
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Associate of JMCG
Jiangling Motor Electricity Vehicle Co., Ltd. Associate of JMCG
Dibao transportation equipment (Nanchang) Co., Ltd Associate of JMCG
Jiangxi Yizhizhihang automobile operation Service Co., Ltd Associate of JMCG
Jiangxi JMCG Motorhome Co.,Ltd. Associate of JMCG
Ji'an Qingyuan District Yongfuda Vehicle Co., Ltd. Associate of JMCG
(i) In March 2022, NC.Gear Forging Factory was renamed to Nanchang Gear Forging
Co.,Ltd.
(ii) In November 2021, Nanchang JMCG Mekra-Lang Vehicle Mirror Co., Ltd. was
renamed to Nanchang JMCG SMR Huaxiang Mirror Co., Ltd.
94
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions
(a) Purchase and sales of goods, provision and receipt of services
Purchase of goods:
Six months ended 30 June
Nature of related party
Related parties transactions 2022 2021
Nanchang Baojiang Steel Processing Distribution Co., Ltd. Purchase of raw materials 403,267,450 487,650,466
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Purchase of automobile parts 382,320,934 386,207,282
Jiangxi Jiangling Chassis Co., Ltd. Purchase of automobile parts 339,792,672 454,821,789
Magna PT Powertrain (Jiangxi) Co., Ltd. Purchase of automobile parts 333,486,963 416,304,253
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Purchase of automobile parts 266,851,205 179,718,350
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. Purchase of automobile parts 266,044,891 559,640,678
Jiangxi Jiangling Lear Interior System Co., Ltd. Purchase of automobile parts 242,153,680 253,713,165
Faurecia Emissions Control Technologies (Nanchang) Co., 214,626,269 204,996,379
Purchase of automobile parts
Ltd.
Nanchang JMCG Liancheng Auto Component Co., Ltd. Purchase of automobile parts 189,110,774 192,440,537
Nanchang Unistar Electric & Electronics Co., Ltd. Purchase of automobile parts 166,933,947 157,062,782
Ford Purchase of automobile parts 149,947,751 406,714,749
Nanchang JMCG Shishun Logistics Co., Ltd. Purchase of automobile parts 93,079,273 186,331,354
Hanon Systems Purchase of automobile parts 76,171,447 113,038,226
JMCG Purchase of automobile parts 56,308,360 95,172,791
Nanchang Yinlun Heat-exchanger Co., Ltd. Purchase of automobile parts 50,988,587 57,322,498
Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. (i) Purchase of automobile parts 46,100,961 51,246,461
Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. Purchase of automobile parts 40,574,487 40,864,845
Dibao transportation equipment (Nanchang) Co., Ltd Purchase of automobile parts 37,004,698 -
Changan Ford Automobile Co., Ltd. Purchase of automobile parts 27,868,811 22,322,571
Jiangxi Lingyun Automobile Industry Technology Co.,Ltd Purchase of automobile parts 27,863,903 16,903,992
Nanchang Lianda Machinery Co., Ltd. Purchase of automobile parts 22,528,774 39,419,200
95
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Purchase of goods (Cont'd):
Six months ended 30 June
Nature of related party
Related parties transactions 2022 2021
Jiangling Motor Holdings Co., Ltd. Purchase of automobile parts 22,122,273 20,348,183
Jiangxi Jiangling Group Special Vehicle Co., Ltd. Purchase of automobile parts 20,702,602 14,710,069
Auto Alliance (Thailand) Co., Ltd. Purchase of automobile parts 19,826,351 22,108,469
Jiangxi ISUZU Engine Co., Ltd. Purchase of automobile parts 14,990,491 5,385,785
Purchase of raw materials and 14,261,806 14,381,157
Jiangling Material Co., Ltd.
automobile parts
Shanxi Yunnei Power Group Co., Ltd. Purchase of automobile parts 12,307,701 -
Jiangxi JMCG Specialty Vehicles Co., Ltd. Purchase of automobile parts 12,189,849 24,377,547
Jiangxi JMCG Boya brake system Co., Ltd Purchase of automobile parts 9,985,963 17,753,794
Jiangxi Lingrui Recycling Resources Development Corporation Purchase of automobile parts 6,687,750 3,603,406
Jiangxi Jiangling group Fuxin Auto Parts Co., Ltd Purchase of automobile parts 6,121,107 -
Jiangling Aowei Automobile Spare Part Co., Ltd. Purchase of automobile parts 5,589,279 12,432,709
Ford Otomotiv Sanayi A.S. Purchase of automobile parts 4,123,733 14,985,072
Nanchang JMCG Xinchen Auto Component Co., Ltd. Purchase of automobile parts 3,521,896 8,531,947
Jiangxi Mingfang Auto Parts Industry Co., Ltd Purchase of automobile parts 2,068,147 -
Nanchang Gear Forging Co.,Ltd. Purchase of automobile parts 2,029,108 4,600,012
Ford Motor Co. Thailand Ltd. Purchase of automobile parts 1,980,663 1,761,533
Nanchang Hengou Industry Co., Ltd. Purchase of automobile parts 1,781,318 378,277
Jiangxi JMCG Industry Co., Ltd. Purchase of automobile parts 120,194 5,555,782
Jiangxi JMCG Shangrao Industrial Co., Ltd. Purchase of automobile parts 495,840 1,532,713
Other related parties Purchase of automobile parts 586,389 75,752
3,594,518,297 4,494,414,575
The products purchased by the Group from related parties are divided into two categories: purchase of imported parts and purchase of domestic
parts.
The pricing on imported parts purchased from Ford or its suppliers is based on the agreed price by both parties.
The pricing on domestic accessories purchased from other related parties is determined through quotation, cost accounting, and negotiation
between the two parties, and is adjusted regularly.
96
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Receipt of services:
Six months ended 30 June
Related parties Nature of related party transactions 2022 2021
Nanchang JMCG Shishun Logistics Co., Ltd. Transportation 193,566,015 183,101,437
Trademark management fees, 117,920,247 137,193,141
Ford Global Technologies,LLC
technology development
Ford Technical services and personnel costs 84,615,500 45,133,925
Jiangxi JMCG Industry Co., Ltd. Meals 10,006,592 10,818,912
Ford Motor (China) Co., Ltd. Personnel costs, etc. 8,952,383 6,622,070
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Agency fee, advertising fee, etc. 8,769,093 4,734,392
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Transportation fee, rental fee, etc. 8,736,909 7,759,524
Technical services and technical 7,397,330 9,025,906
Ford Otomotiv Sanayi A.S.
development, personnel costs
Ford Motor Research & Engineering (Nanjing) 7,304,257 3,698,207
Personnel costs
Co., Ltd.
Changan Ford Automobile Co., Ltd. Service fee, labor costs, etc. 5,099,373 16,626,550
Shanxi Yunnei Power Group Co., Ltd. Consulting fee 4,109,652 -
Magna PT Powertrain (Jiangxi) Co., Ltd. Design fee, experimental costs 4,036,036 44,000
Chongqing Changan Automobile Co., Ltd. Personnel costs 1,229,023 840,139
Jiangling Motor Holdings Co., Ltd. Labor fee, rental fee, personnel fee 1,165,365 5,041,950
Jiangxi JMCG Specialty Vehicles Co., Ltd. Promotion 1,143,651 1,139,648
JMCG Jiangxi Engineering Construction Co., Ltd. Engineering construction - 91,462,137
Nanchang Jiangling HuaXiang Auto Components - 2,175,305
Design fee, experimental costs
Co., Ltd.
Other related parties 5,737,232 3,706,823
469,788,658 529,124,066
The Group’s pricing on services received from related parties is based on the agreed price by both parties.
97
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Sales of goods:
Six months ended 30 June
Nature of related party
Related parties transactions 2022 2021
Sales of vehicles and accessories, 2,209,977,113 1,448,104,620
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd.
utilities, etc.
Jiangxi JMCG Specialty Vehicles Sales Corporation, 282,115,147 116,350,946
Sale of vehicles
Ltd.
Jiangxi JMCG Specialty Vehicles Co., Ltd. Sales of vehicles and accessories 44,907,062 29,087,061
Sales of vehicles, accessories, 42,637,998 3,429,676
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd.
utilities
Jiangxi Jiangling Chassis Co., Ltd. Sales of accessories 42,234,955 35,912,126
Jiangxi Lingrui Recycling Resources Development 34,140,746 46,091,112
Waste materials, utilities
Corporation
Jiangxi Jiangling Group Special Vehicle Co., Ltd. Sales of vehicles and accessories 32,393,211 22,609,914
Chongqing Anfu Vehicle Marketing Co., Ltd. Sales of vehicles and accessories 29,103,852 19,801,630
JMCG Jingma Motors Co., Ltd. Sales of vehicles and accessories 24,715,398 28,334,162
Chengdu Wanxing Vehicle Sales & Service Co., Ltd. Sales of vehicles and accessories 24,018,999 20,425,695
Guizhou Wanfu Vehicle Sales & Service Co., Ltd. Sales of vehicles and accessories 22,480,856 7,888,813
China Changan Group Tianjin Sales Co., Ltd. Sales of vehicles and accessories 21,636,708 5,932,997
Chongqing Anbo Vehicle Sales Co., Ltd. Sales of vehicles and accessories 18,711,495 18,291,943
Dali Wanfu Vehicle Sales & Service Co., Ltd. Sales of vehicles and accessories 18,290,574 21,352,956
Jiangxi ISUZU Co., Ltd. Sales of accessories 12,091,000 2,382,506
Beijing Beifang Changfu Vehicle Sales & Service Co., 8,851,241 3,394,918
Sales of vehicles and accessories
Ltd.
Guizhou Wanjia Automobile Sales and Service Co. 7,915,724 3,745,325
Sales of vehicles and accessories
LTD
Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. Sales of accessories 6,383,323 4,950,891
Nanchang Hengou Industry Co., Ltd. Sales of accessories 4,123,832 4,575,689
98
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Sales of goods (Cont'd):
Six months ended 30 June
Related parties Nature of related party transactions 2022 2021
Jiangxi Jiangling Lear Interior System Co., Ltd. Sales of accessories 3,840,532 2,376,736
Nanchang JMCG Liancheng Auto Component Co., 3,283,574 4,850,081
Sales of accessories
Ltd.
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Sales of accessories 2,338,248 24,575,547
Nanchang Jiangling HuaXiang Auto Components 1,657,502 1,620,115
Sales of accessories
Co., Ltd.
Sales of accessories, utilities and 1,649,088 1,265,886
Jiangxi JMCG Industry Co., Ltd.
waste materials, etc.
Sales of vehicles, accessories, 1,057,296 12,279,634
Nanchang JMCG Shishun Logistics Co., Ltd.
utilities
Jiujiang Fuwantong Vehicle Co., Ltd. Sales of vehicles and accessories 388,555 6,759,745
Anhui Wanyou Automobile Sales service Co. LTD Sales of vehicles and accessories 166,674 1,425,731
Jiangxi Yizhizhihang automobile operation Service - 1,302,655
Sale of vehicles
Co., Ltd
Nanchang Lianda Machinery Co., Ltd. Sales of accessories 966,735 1,236,605
Other related parties 1,247,958 3,099,955
2,903,325,396 1,903,455,670
The Group’s pricing on goods sold to related parties is based on the agreed price by both parties.
99
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(b) Leases
(i) The lease income recognised in the current period with the Group as the lessor:
Six months ended 30 June
Name of the lessee Type of the leased asset 2022 2021
Jiangxi JMCG Motorhome Co.,Ltd. Buildings 2,945 -
Jiangling Material Co., Ltd. Buildings - 60,550
Jiangxi ISUZU Co., Ltd. Buildings - 31,371
2,945 91,921
(ii) Increase of right-of-use assets in the current period with the Group as the lessee
Six months ended 30 June
Name of the lessor Type of the leased asset 2022 2021
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Buildings - 16,852,582
JMCG Buildings - 182,766
- 17,035,348
100
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(b) Leases (Cont'd)
(iii) Interest expenses on lease liabilities in the current period with the Group as the lessee:
Six months ended 30 June
2022 2021
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 311,702 213,557
JMCG 169,421 221,943
481,123 435,500
(c) Guarantee received
Guaranteed
Guarantor amount Starting date Ending date Fully performed or not
JMCF 2,417,197 5 March 2001 30 October 2029 Not fully performed
For the six months ended 30 June 2022, JMCF provided guarantees for some bank borrowings of the Group, with a maximum guarantee limit of
USD2,282,123. As at 30 June 2022, JMCF provided borrowing guarantee to the bank borrowing of USD360,163, equivalent to RMB2,417,197 (31
December 2021: USD392,905, equivalent to RMB2,505,044) for the Group.
101
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(d) Transfer of assets
Six months ended 30 June
Nature of related party
Related parties transactions 2022 2021
JMCG Jingma Motors Co., Ltd. Sales of fixed assets 4,527,773 -
The pricing on transfer of assets between the Group and related parties is based on the agreed price by both parties.
102
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(e) Purchase of assets
Six months ended 30 June
Nature of related party
Related parties transactions 2022 2021
Nanchang Jiangling HuaXiang Auto Components
14,279,803 444,600
Co., Ltd. Purchase of fixed assets
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. Purchase of fixed assets 6,988,280 4,946,744
Nanchang JMCG Liancheng Auto Component Co., Purchase of fixed assets
5,520,000 -
Ltd.
Jiangxi JMCG Specialty Vehicles Co., Ltd. Purchase of fixed assets 456,637 -
Magna PT Powertrain (Jiangxi) Co., Ltd. Purchase of fixed assets - 2,480,000
27,244,720 7,871,344
The pricing on purchase of assets between the Group and related parties is based on the agreed price by both parties.
(f) Provision of technology sharing and distribution services
Six months ended 30 June
Nature of related party
Related parties transactions 2022 2021
Ford Motor Research & Engineering (Nanjing)
13,494,000 24,740,000
Co., Ltd. Technical service
Ford Motor (China) Co., Ltd. Distribution services 10,405,000 -
Ford Technical service 9,350,000 3,230,000
Ford Vietnam Limited Technical service 7,890,000 12,780,000
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Technical service 4,630,000 -
Jiangxi ISUZU Co., Ltd. Technical service 710,000 4,615,000
Ford Trading Company LLC Technical service - 2,350,000
Ford Otomotiv Sanayi A.S. Technical service - 340,000
46,479,000 48,055,000
The Group’s pricing on technology sharing provided to related parties is based on the agreed price by both parties.
103
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(g) Purchase of CAFC credit and NEV credit
Six months ended 30 June
Related parties 2022 2021
Jiangling Motor Electricity Vehicle Co., Ltd. 64,474,060 11,186,318
Jiangling Motor Holdings Co., Ltd. - 177,528,259
64,474,060 188,714,577
The Group’s pricing on CAFC credit and NEV credit purchased from related parties is based
on the agreed price by both parties.
(h) Remuneration of key management
Six months ended 30 June
2022 2021
Remuneration of key management 6,880,167 11,096,700
(i) Interest income
Six months ended 30 June
2022 2021
JMCF 8,304,462 9,065,202
Cash at bank of the Group deposited with JMCF was calculated based on the bank annual
interest rate for RMB deposit of 1.725% to 2.25% over the same period (2021: 1.725% to
2.25%).
(j) Interest expenses
Six months ended 30 June
2022 2021
Jiangxi Zhonglian Intelligent Logistics Co.,
- 60,000
Ltd.
Nanchang JMCG Shishun Logistics Co., Ltd. - 15,000
- 75,000
104
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties
Receivables from related parties:
30 June 2022 31 December 2021
Provision for bad Provision for bad
Amount debts Amount debts
Accounts receivable
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 1,515,593,940 (1,737,398) 1,055,206,739 (2,469,956)
Jiangxi JMCG Specialty Vehicles Sales
84,790,397 (695,802) 70,709,214 (56,476)
Corporation, Ltd.
Jiangxi Jiangling Special Purpose Vehicle Co.,
40,841,323 (17,569) 4,511,078 (7,003)
Ltd.
Jiangxi ISUZU Co., Ltd. 12,097,610 (36,544) 534,623 (1,890)
Ford Motor (China) Co., Ltd. 11,029,300 (38,989) - -
JMCG Jingma Motors Co., Ltd. 10,891,970 (32,676) 16,858,567 (59,595)
Ford 9,350,000 (33,052) - -
Jiangxi Jiangling Group Special Vehicle Co.,
8,164,252 (43,730) - -
Ltd.
Jiangxi Jiangling Lear Interior System Co., Ltd. 2,974,189 (8,923) 1,430,746 (5,058)
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. 1,202,362 (3,607) 4,113,754 (14,542)
Nanchang Jiangling HuaXiang Auto
1,047,964 (3,144) 622,667 (2,201)
Components Co., Ltd.
Nanchang JMCG Liancheng Auto Component
1,022,204 (3,067) 1,655,446 (5,852)
Co., Ltd.
Jiangxi JMCG Specialty Vehicles Co., Ltd. 546,246 (1,639) 10,889,510 (9,689)
Nanchang JMCG SMR Huaxiang Mirror Co.,
576,649 (1,730) 3,253,009 (11,499)
Ltd. (i)
Nanchang Hengou Industry Co., Ltd. 23,566 (71) 1,189,979 (4,207)
Magna PT Powertrain (Jiangxi) Co., Ltd. 212,440 (637) 1,102,564 (3,898)
Nanchang JMCG Frame Co., Ltd - - 1,094,172 (3,868)
Other related parties 2,050,630 (6,243) 1,130,228 (3,996)
1,702,415,042 (2,664,821) 1,174,302,296 (2,659,730)
105
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Receivables from related parties (Cont'd):
30 June 2022 31 December 2021
Provision for bad Provision for bad
Amount debts Amount debts
Other receivables
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 10,082,646 (30,248) 25,000,000 (75,000)
JMCG Jingma Motors Co., Ltd. 4,614,745 (13,844) - -
Jiangling Motor Electricity Vehicle Co., Ltd. - - 31,266,512 (93,800)
Jiangxi Lingrui Recycling Resources
- - 17,668,457 (53,005)
Development Corporation
Other related parties 15,783 (47) 121,141 (364)
14,713,174 (44,139) 74,056,110 (222,169)
106
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Receivables from related parties (Cont'd):
30 June 31 December
2022 2021
Other non-current
assets Ford 129,021,097 -
Advances to Nanchang Baojiang Steel
suppliers Processing Distribution Co., Ltd. 328,060,152 399,394,083
Financing Jiangxi JMCG Specialty Vehicles 30,000,000 -
receivables Sales Corporation, Ltd.
Jiangxi JMCG Specialty Vehicles 20,000,000 -
Co., Ltd.
JMCG Jingma Motors Co., Ltd. 4,540,310 2,357,022
Jiangxi ISUZU Co., Ltd. 700,000 -
Nanchang JMCG Frame Co., Ltd 500,000 2,000,000
55,740,310 4,357,022
Cash at bank JMCF 741,784,787 1,059,580,980
For the six months ended 30 June 2022, the sales amount settled by JMCF was
RMB6,037,852,983 (2021 half year: RMB10,429,291,680).
107
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Payables to related parties:
30 June 31 December
2022 2021
Accounts Nanchang Jiangling HuaXiang Auto
481,305,119 476,070,536
payable Components Co., Ltd.
Jiangxi Jiangling Lear Interior System Co., Ltd. 247,329,820 251,892,398
Jiangxi Jiangling Special Purpose Vehicle Co.,
221,813,473 405,329,856
Ltd.
Jiangxi Jiangling Chassis Co., Ltd. 209,886,841 314,370,464
Magna PT Powertrain (Jiangxi) Co., Ltd. 201,777,407 224,125,697
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. 188,603,956 188,395,117
Nanchang JMCG Liancheng Auto Component
152,465,033 162,044,531
Co., Ltd.
Faurecia Emissions Control Technologies
152,155,139 181,015,647
(Nanchang) Co., Ltd.
Hanon Systems 85,873,706 51,492,058
Nanchang Unistar Electric & Electronics Co.,
83,218,532 118,507,723
Ltd.
Ford 69,690,303 112,369,950
JMCG 53,036,999 68,694,580
Nanchang JMCG Shishun Logistics Co., Ltd. 46,352,928 99,211,184
Nanchang Yinlun Heat-exchanger Co., Ltd. 34,763,472 38,501,505
Jiangxi JMCG Specialty Vehicles Co., Ltd. 30,013,729 46,385,916
Jiangxi Lingge Non-ferrous Metal Die-casting
29,142,506 38,128,081
Co., Ltd.
Nanchang JMCG SMR Huaxiang Mirror Co.,
27,270,852 61,887,021
Ltd. (i)
Jiangling Motor Holdings Co., Ltd. 25,342,991 15,315,388
Jiangxi Lingyun Automobile Industry
21,028,675 9,533,560
Technology Co.,Ltd
Dibao transportation equipment (Nanchang)
20,296,534 29,226,123
Co., Ltd
Jiangxi ISUZU Engine Co., Ltd. 16,951,045 7,167,608
Changan Ford Automobile Co., Ltd. 16,804,284 10,017,548
Jiangxi Jiangling Group Special Vehicle Co.,
12,924,682 16,813,329
Ltd.
Nanchang Lianda Machinery Co., Ltd. 10,500,231 19,653,964
Jiangxi Lingrui Recycling Resources
6,151,467 5,669,023
Development Corporation
Auto Alliance (Thailand) Co., Ltd. 4,403,234 3,986,161
Jiangxi JMCG Boya brake system Co., Ltd 4,266,801 14,172,332
Jiangling Aowei Automobile Spare Part Co.,
4,096,771 4,402,913
Ltd.
Nanchang JMCG Xinchen Auto Component
3,251,203 6,542,386
Co., Ltd.
Jiangxi Jiangling group Fuxin Auto Parts Co.,
2,951,938 5,126,842
Ltd
Jiangxi Mingfang Auto Parts Industry Co., Ltd 2,392,091 1,920,999
Nanchang Hengou Industry Co., Ltd. 1,923,147 1,537,861
Ford Otomotiv Sanayi A.S. 1,639,114 2,224,130
Nanchang Gear Forging Co.,Ltd. 1,614,819 3,008,017
Jiangling Material Co., Ltd. 1,172,117 2,143,099
Jiangxi JMCG Industry Co., Ltd. 140,532 2,995,670
Other related parties 769,585 2,190,179
2,473,321,076 3,002,069,396
108
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Payables to related parties (Cont'd):
30 June 31 December
2022 2021
Other
payables Ford 122,282,789 61,135,567
JMCG Jiangxi Engineering Construction Co.,
Ltd. 73,335,270 112,247,451
Ford Global Technologies,LLC 61,172,428 65,331,412
Jiangxi JMCG Specialty Vehicles Sales
Corporation, Ltd. 19,816,247 24,120,434
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 13,451,240 3,209,698
Magna PT Powertrain (Jiangxi) Co., Ltd. 9,809,987 8,783,237
Ford Motor (China) Co., Ltd. 9,229,099 4,670,514
Nanchang JMCG Shishun Logistics Co., Ltd. 8,415,989 7,302,639
Jiangxi Jiangling Group Special Vehicle Co.,
Ltd. 4,957,979 11,035,849
Jiangxi JMCG Specialty Vehicles Co., Ltd. 4,590,958 4,590,958
Ford Motor Research & Engineering (Nanjing)
Co., Ltd. 3,708,366 2,229,384
Ford Otomotiv Sanayi A.S. 3,659,139 4,578,953
Jiangxi Jiangling Special Purpose Vehicle Co.,
Ltd. 3,115,248 5,719,260
Chongqing Changan Automobile Co., Ltd. 2,909,302 1,680,278
Nanchang Unistar Electric & Electronics Co.,
Ltd. 2,160,429 966,018
Faurecia Emissions Control Technologies
(Nanchang) Co., Ltd. 2,033,555 4,111,935
Jiangxi JMCG Industry Co., Ltd. 1,884,570 1,753,181
Nanchang Baojiang Steel Processing
Distribution Co., Ltd. 1,763,051 2,722,060
Nanchang Jiangling HuaXiang Auto
Components Co., Ltd. 1,475,283 1,438,427
Hanon Systems 1,475,000 1,475,000
Jiangxi Jiangling Lear Interior System Co., Ltd. 1,077,000 1,007,000
JMCG Property Management Co. 1,012,500 1,265,900
Other related parties 4,493,750 4,521,160
357,829,179 335,896,315
Contract Guizhou Wanfu Vehicle Sales & Service Co.,
liabilities Ltd. 1,157,351 376,671
Chongqing Anbo Vehicle Sales Co., Ltd. 1,129,807 357,767
Jiangxi JMCG Specialty Vehicles Co., Ltd. 1,048,240 38,335
Jiangxi Jiangling Group Special Vehicle Co.,
Ltd. - 1,790,486
Other related parties 1,174,187 2,020,555
4,509,585 4,583,814
Lease
liabilities Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 13,504,023 17,391,559
JMCG 5,894,009 7,027,932
19,398,032 24,419,491
109
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
8 Related parties and related party transactions (Cont'd)
(7) Commitments in relation to related parties
Capital commitments 30 June 2022 31 December 2021
JMCG Jiangxi Engineering
Construction Co., Ltd. - 270,278,911
Guarantee of commitments in relation to related parties is set out in Note 8(5)(c).
9 Contingencies
As at 30 June 2022, the Group had no contingencies that needed to be disclosed in the
notes to the financial statements.
10 Commitments
Capital expenditure commitments
Capital expenditures contracted for by the Group but are not yet necessary to be recognised
on the balance sheet as at the balance sheet date were as follows:
30 June 2022 31 December 2021
Buildings, machinery and equipment 721,650,000 1,040,550,000
110
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk
The Group's activities expose it to a variety of financial risks, which mainly comprise
market risk (primarily including foreign exchange risk and interest rate risk), credit risk and
liquidity risk. The above financial risks and the Group's risk management policies to
mitigate the risks are as follows:
The Board of Directors is responsible for planning and establishing the Group's risk
management framework, formulating the Group's risk management policies and related
guidelines, and supervising the implementation of risk management measures. The Group
has established risk management policies to identify and analyse the risks faced by the
Group. These risk management policies specify the risks such as market risk, credit risk
and liquidity risk management. The Group regularly evaluates the market environment and
changes in the Group's operating activities to determine whether to update the risk
management policies and systems or not. The Group’s risk management is carried out by
the Risk Management Committee under policies approved by the Board of Directors. The
Risk Management Committee works closely with other business departments of the Group
to identify, evaluate and avoid relevant risks. The internal audit department of the Group
conducts periodical audit to the controls and procedures for risk management and reports
the audit results to the Risk Management Committee of the Group.
(1) Market risk
(a) Foreign exchange risk
The Group’s major operational activities are carried out in Mainland China and a majority
of the transactions are denominated in RMB. The Group is exposed to foreign exchange
risk arising from the recognised assets and liabilities, and future transactions denominated
in foreign currencies, primarily with respect to USD. The Group monitors the amount of
assets and liabilities, and transactions denominated in foreign currencies to minimise the
foreign exchange risk. Therefore, the Group signed forward exchange contracts to
mitigate the foreign exchange risk (Note 4(21)).
The financial assets and financial liabilities denominated in foreign currencies, which were
held by the Group and the subsidiaries of the Group, were expressed in RMB As at 30
June 2022 and 31 December 2021 as follows:
30 June 2022
USD EUR Total
Financial liabilities
denominated in foreign
currency -
Derivative financial liabilities 5,432,067 - 5,432,067
Current portion of long-term 439,490 439,490
borrowings -
Long-term borrowings 1,977,707 - 1,977,707
Other payables 186,887,018 233,296 187,120,314
194,736,282 233,296 194,969,578
111
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Cont’d)
(1) Market risk (Cont’d)
(a) Foreign exchange risk (Cont’d)
31 December 2021
USD EUR Total
Financial liabilities
denominated in foreign
currency -
Derivative financial liabilities 10,704,619 - 10,704,619
Current portion of long-term
borrowings 417,507 - 417,507
Long-term borrowings 2,087,537 - 2,087,537
Other payables 130,811,883 240,329 131,052,212
144,021,546 240,329 144,261,875
As at 30 June 2022, for the financial assets and liabilities dominated in foreign currencies,
if the RMB had strengthened/weakened by 10% against the USD while all other variables
had been held constant, the Group’s net profit would have been approximately
RMB15,600,408 (31 December 2021: approximately RMB10,422,046) higher/lower; if the
RMB had strengthened/weakened by 10% against the EUR while all other variables had
been held constant, the Group’s net profit would have been approximately RMB19,830 (31
December 2021: approximately RMB20,428) higher/lower.
(b) Interest rate risk
The Group's interest rate risk mainly arises from interest-bearing debts such as short-term
borrowings and long-term borrowings. The financial liabilities of floating interest rate
expose the Group to cash flow interest rate risk, and the financial liabilities of fixed
interest rate expose the Group to fair value interest rate risk. The Group determines the
relative proportions of fixed-rate and floating-rate contracts based on the prevailing
market environment. As at 30 June 2022, the Group’s short-term borrowings of RMB
1,400,000,000 (31 December 2021: RMB300,000,000) were fixed-rate borrowings, and
long-term borrowings of USD360,163 (31 December 2021: USD392,905) were fixed-rate
contracts, therefore there was no significant cash flow interest rate risk.
As at 30 June 2022 and 31 December 2021, there was no significant difference between
the fair value and the carrying amount of the Group’s bank borrowings with fixed rates.
(2) Credit risk
The Group’s credit risk mainly arises from cash at bank and on hand, notes receivable,
accounts receivable, financing receivables, other receivables, long-term receivables and
derivative financial assets at fair value through profit or loss that are not included in the
impairment assessment scope. The carrying amount of the Group’s financial assets
reflects its maximum credit exposure on the balance sheet date.
The Group expects that there is no significant credit risk associated with cash at bank and
on hand since they are deposited at state-owned banks and other medium or large size
banks with good reputation and high credit rating. The Group does not expect that there
will be significant losses from non-performance by these banks.
112
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Cont’d)
(2) Credit risk (Cont’d)
In addition, the Group has policies to limit the credit exposure on notes receivable, accounts
receivable, financing receivables, other receivables and long-term receivables. The Group
assesses the credit quality of and sets credit limits on its customers by taking into account
their financial position, the availability of guarantee from third parties, their credit history and
other factors such as current market conditions. The credit history of the customers is
regularly monitored by the Group. In respect of customers with a poor credit history, the
Group will use written payment reminders, or shorten or cancel credit periods, to ensure the
overall credit risk of the Group is limited to a controllable extent.
As at 30 June 2022, the Group had no significant collateral or other credit enhancements
held as a result of the debtor’s mortgage (31 December 2021: Nil).
(3) Liquidity risk
Cash flow forecasting is performed by each subsidiary of the Group and aggregated by the
Group. The Group monitors rolling forecasts of the Group's short-term and long-term
liquidity requirements to ensure it has sufficient cash and securities that are readily
convertible to cash to meet operational needs, while maintaining sufficient headroom on its
undrawn committed borrowing facilities from major financial institutions so that the Group
does not breach borrowing limits or covenants on any of its borrowing facilities to meet the
short-term and long-term liquidity requirements.
The financial liabilities of the Group at the balance sheet date are analysed by their maturity
date below at their undiscounted contractual cash flows:
30 June 2022
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Short-term
borrowings 1,400,000,000 - - - 1,400,000,000
Derivative
financial
liabilities 5,432,067 - - - 5,432,067
Accounts payable 7,924,733,465 - - - 7,924,733,465
Other payables 5,584,079,719 - - - 5,584,079,719
Lease liabilities 84,093,674 75,409,646 134,042,175 - 293,545,495
Long-term
borrowings 439,490 439,490 1,318,471 219,746 2,417,197
14,998,778,415 75,849,136 135,360,646 219,746 15,210,207,943
113
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Cont’d)
(3) Liquidity risk (Cont’d)
The financial liabilities of the Group at the balance sheet date are analysed by their maturity
date below at their undiscounted contractual cash flows (Cont'd):
31 December 2021
Within 1 1 to 2 2 to 5 Over 5
year years years years Total
Short-term
borrowings 300,000,000 - - - 300,000,000
Derivative
financial
liabilities 10,704,619 - - - 10,704,619
Accounts
payable 9,702,584,830 - - - 9,702,584,830
Other
payables 5,253,800,805 - - - 5,253,800,805
Lease
liabilities 90,602,618 80,927,296 203,090,850 - 374,620,764
Long-term
borrowings 453,517 447,254 1,304,189 422,205 2,627,165
15,358,146,389 81,374,550 204,395,039 422,205 15,644,338,183
(i) As at 30 June 2022, the Group did not have lease contracts that had been signed but had not
yet been implemented.
114
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates
The level in which fair value measurement is categorised is determined by the level of the
fair value hierarchy of the lowest level input that is significant to the entire fair value
measurement:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
(1) Assets and liabilities measured at fair value on a recurring basis
As at 30 June 2022, the assets measured at fair value on a recurring basis by the above
three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financing receivables -
Notes receivable - - 286,259,584 286,259,584
As at 30 June 2022, the liabilities measured at fair value on a recurring basis by the above
three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financial liabilities -
Derivative financial
liabilities -
Forward foreign
exchange contracts - 5,432,067 - 5,432,067
115
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis (Cont'd)
As at 31 December 2021, the assets measured at fair value on a recurring basis by the
above three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financial assets -
Financial assets held for
trading -
Structural deposits - 100,242,329 - 100,242,329
Financing receivables -
Notes receivable - - 201,511,670 201,511,670
- 100,242,329 201,511,670 301,753,999
As at 31 December 2021, the liabilities measured at fair value on a recurring basis by the
above three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financial liabilities -
Derivative financial
liabilities -
Forward foreign
exchange contracts --- 10,704,619 -- 10,704,619
The Group takes the date on which events causing the transfers between the levels take
place as the timing specific for recognising the transfers. There was no transfer between
Level 1 and Level 2 for the six months ended 30 June 2022.
The fair value of financial instruments traded in an active market is determined at the
quoted market price; and the fair value of those not traded in an active market is
determined by the Group using valuation technique. The valuation models used mainly
comprise discounted cash flow model and market comparable corporate model. The inputs
of valuation technique mainly include risk-free interest rate, benchmark rate, exchange rate,
etc.
116
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis (Cont'd)
The changes in Level 3 financial assets are analysed below:
Changes in unrealised gains
or losses included in profit
or loss For the six months
ended 30 June 2022 with
Gains respect to assets still held
recognised in As at 30 June 2022 - gains
31 December 30 June profit or loss or losses on changes in fair
2021 Increase Decrease 2022 (a) value
Financing
receivables -
Notes receivable 201,511,670 1,726,846,085 (1,642,098,171) 286,259,584 - -
(a) Gains recognised in profit or loss are recognised in investment income in the income statement.
117
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis (Cont'd)
The changes in Level 3 financial assets are analysed below (Cont'd):
Changes in unrealised gains
or losses included in profit
or loss in 2021 with respect
Gains to assets still held As at 31
recognised in December 2021 - gains or
31 December 31 December profit or loss losses on changes in fair
2020 Increase Decrease 2021 (a) value
Financial assets
Financial assets
held for trading -
Monetary fund - 500,000,000 (500,000,000) - 198,623 -
Financing
receivables -
Notes receivable 815,583,669 3,073,998,320 (3,688,070,319) 201,511,670 - -
Total assets 815,583,669 3,573,998,320 (4,188,070,319) 201,511,670 198,623 -
(a) Gains recognised in profit or loss are recognised in investment income in the income statement.
118
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(2) Assets measured at fair value on a non-recurring basis
As at 30 June 2022 and 31 December 2021, the Group had no assets measured at fair
value on a non-recurring basis.
(3) Assets and liabilities not measured at fair value but for which the fair value is disclosed
The Group’s financial assets and liabilities measured at amortised cost mainly comprise
notes receivable, accounts receivable, other receivables, long-term receivables, short-term
borrowings, payables, lease liabilities and long-term borrowings, etc.
The carrying amount of the Group's financial assets and liabilities not measured at fair
value is a reasonable approximation of their fair value.
The fair value of long-term borrowings is the present value of the contractually determined
stream of future cash flows discounted at the rate of interest applied at that time by the
market to instruments of comparable credit status and providing substantially the same
cash flows on the same terms, and categorised within Level 3 of the fair value hierarchy.
13 Capital management
The Group’s capital management policies aim to safeguard the Group’s ability to continue
as a going concern in order to provide returns for shareholders and benefits for other
stakeholders, and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of
dividends paid to shareholders, refund capital to shareholders, issue new shares or sell
assets to reduce debts.
The Group's total capital is calculated as “shareholders’ equity” as shown in the
consolidated balance sheet. The Group is not subject to external mandatory capital
requirements, and monitors capital on the basis of equity ratio.
As at 30 June 2022 and 31 December 2021, the Group's equity ratio was as follows:
30 June 2022 31 December 2021
Total borrowings 1,402,417,197 302,505,044
Total shareholders’ equity 8,796,753,047 8,555,444,589
Equity ratio 16% 4%
119
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements
(1) Accounts receivable
30 June 2022 31 December 2021
Accounts receivable 1,962,586,751 1,576,660,469
Less: Provision for bad debts (160,934,499) (167,340,229)
1,801,652,252 1,409,320,240
(a) The ageing of accounts receivable is analysed as follows:
30 June 2022 31 December 2021
Within 1 year 1,722,889,665 1,231,549,719
Over 1 years 239,697,086 345,110,750
1,962,586,751 1,576,660,469
(b) As at 30 June 2022, the top five accounts receivable ranked by remaining balances are
analysed as follows:
Amount of
provision for bad % of total
Balance debts balance
Company 1 1,502,387,308 (1,635,029) 76.55%
Company 2 74,668,369 - 3.80%
Company 3 72,230,000 (72,230,000) 3.68%
Company 4 53,472,491 (160,417) 2.72%
Company 5 29,707,434 (89,122) 1.51%
1,732,465,602 (74,114,568) 88.26%
120
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts
(i) Accounts receivable for which provision for bad debts is made on the individual basis are
analysed as follows:
30 June 2022
Book balance Provision for bad debts
Provision for
Amount Lifetime ECL (%) bad debts
Receivables from related
parties within the
Group i) 74,668,369 - -
New energy subsidies
receivable ii) 84,903,126 100% (84,903,126)
Receivables for
automobiles iii) 72,230,000 100% (72,230,000)
231,801,495 (157,133,126)
31 December 2021
Book balance Provision for bad debts
Provision for
Amount Lifetime ECL (%) bad debts
Receivables from related
parties within the
Group i) 74,668,369 - -
New energy subsidies
receivable ii) 84,903,126 100% (84,903,126)
Receivables for
automobiles iii) 72,230,000 100% (72,230,000)
231,801,495 (157,133,126)
i) As at 30 June 2022 and 31 December 2021, the Company's accounts receivable from
subsidiaries SZFJ was RMB74,668,369. The Company carried out individual assessment on
receivables from subsidiaries. Based on the judgement of credit risk, there is no significant
credit risk on receivables from subsidiaries, no overdue or impairment.
ii) As at 30 June 2022 and 31 December 2021, state subsidies receivable for new energy
automobiles amounted to RMB84,903,126, as the corresponding new energy vehicles may
not meet the corresponding subsidy policy standards, the Company considered that the state
subsidies cannot be collected, therefore, full provision was made.
iii) As at 30 June 2022 and 31 December 2021, since aforesaid companies in debts had
difficulties in operation and were involved in several legal proceedings, the Company
considered that it was difficult to recover such receivables, so related provision for bad debts
was made in full amount RMB72,230,000.
121
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows:
Grouping - Sales of general automobiles:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Not overdue 1,165,315,142 0.04% (436,969)
Overdue for 1 to 30 days 112,761,821 0.04% (42,405)
Overdue for 31 to 60 days 76,767,277 0.86% (663,275)
Overdue for 61 to 90 days 3,822,500 2.91% (111,240)
Overdue over 90 days 2,737,000 4.84% (132,592)
1,361,403,740 (1,386,481)
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Not overdue 833,314,688 0.08% (675,142)
Overdue for 1 to 30 days 149,950,389 0.08% (120,161)
Overdue for 31 to 60 days 29,645,955 2.44% (721,967)
Overdue for 61 to 90 days 17,638,503 4.15% (732,260)
Overdue over 90 days 114,035 5.01% (5,710)
1,030,663,570 (2,255,240)
Grouping - Sales of new energy automobiles:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Overdue over 90 days 6,690,591 16.53% (1,106,268)
122
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - Sales of new energy automobiles (Cont’d):
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Overdue over 90 days 111,207,654 6.51% (7,234,301)
Grouping - Automobile parts:
30 June 2022
Book balance Provision for bad debts
Amount Lifetime ECL(%) Amount
Not overdue 285,342,275 0.30% (861,029)
Overdue for 1 to 30 days 63,756,212 0.30% (191,269)
Overdue for 31 to 60 days 3,047,530 0.50% (15,238)
Overdue for 61 to 90 days 880,854 0.60% (5,285)
Overdue over 90 days 9,664,054 2.44% (235,803)
362,690,925 (1,308,624)
123
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - Automobile parts (Cont’d):
31 December 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 171,058,119 0.30% (513,174)
Overdue for 1 to 30 days 10,595,578 0.30% (31,787)
Overdue for 31 to 60 days 14,644,585 0.50% (73,223)
Overdue for 61 to 90 days 3,464,188 0.60% (20,785)
Overdue over 90 days 3,225,280 2.44% (78,593)
202,987,750 (717,562)
(iii) The provision for bad debts in the current period amounted to RMB6,405,730 was
reversed, because of the actual receipt of account receivables relating to the provision for
bad debts made in the prior period.
(d) For the six months ended 30 June 2022, no accounts receivable were written off.
(e) As at 30 June 2022 and 31 December 2021, the Company did not have accounts
receivable that were pledged.
124
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables
30 June 2022 31 December 2021
Receivable for subsidiary
disposal(Note 5) 188,300,000 252,000,000
Receivable within the group
related parties 14,892,254 9,679,410
Import working capital advances 10,000,000 25,000,000
Disposal of assets 4,930,445 17,668,457
Others 65,235,014 97,471,253
283,357,713 401,819,120
Less: Provision for bad debts (701,393) (1,031,283)
282,656,320 400,787,837
(a) The ageing of other receivables is analysed as follows:
30 June 2022 31 December 2021
Within 1 year 269,448,234 399,577,953
Over 1 year 13,909,479 2,241,167
283,357,713 401,819,120
125
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements
Stage 1 Stage 3
Expected credit losses in Expected credit losses in the
the following 12 months following 12 months (individual) Lifetime ECL (Credit
(grouping) Sub-total impaired) Total
Provision Provision
Book for bad Provision for for bad Book Provision for Provision for
balance debts Book balance bad debts debts balance bad debts bad debts
31 December 2021 392,139,710 (1,031,283) 9,679,410 - (1,031,283) - - (1,031,283)
Net increase/(decrease)
(123,727,189) - 5,212,844 - - 52,938 (2,118) (2,118)
in the current period
Reversal in the
- 332,008 - - 332,008 - - 332,008
current period
Write-off in the current
- - - - - - - -
period
30 June 2022 268,412,521 (699,275) 14,892,254 - (699,275) 52,938 (2,118) (701,393)
126
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d)
As at 30 June 2022 and 31 December 2021, the Company did not have any other receivables
at Stage 2. Other receivables at Stage 1 were analysed below:
(i) As at 30 June 2022 and 31 December 2021, provision for bad debts of other receivables on
the individual basis was analysed as follows:
30 June 2022
12-month ECL Provision for
Stage 1 Book balance (%) bad debts Reason
Receivable within the
group related parties 14,892,254 - - i)
i) As at 30 June 2022, the Company’s other receivables from subsidiary JMCH were
RMB9,679,410 and from holding subsidiary Jiangling Ford Technology were RMB5,212,844.
The Company carried out an individual assessment on receivables from subsidiaries. Based on
the judgement of credit risk, there is no significant credit risk on receivables from subsidiaries
that were overdue and impaired.
As at 31 December 2021, the Company’s other receivables from subsidiary JMCH were
RMB9,679,410. The Company carried out an individual assessment on receivables from
subsidiaries. Based on the judgement of credit risk, there is no significant credit risk on
receivables from subsidiaries that were overdue and impaired.
(ii) As at 30 June 2022 and 31 December 2021, the Company’s other receivables with provision
for bad debts on the grouping basis were analysed below:
Other receivables with provision on the grouping basis at Stage 1:
30 June 2022 31 December 2021
Book
balance Provision for losses Book balance Provision for losses
Provision Provision
Amount ratio Amount Amount ratio Amount
Grouping of
operating
advances and
guarantees
Within 1 year 229,190,144 0.30% (686,744) 341,767,579 0.30% (1,024,521)
Over 1 year 4,177,131 0.30% (12,531) 2,241,167 0.30% (6,762)
Grouping of others i):
Within 1 year 35,045,246 - - 48,130,964 - -
268,412,521 (699,275) 392,139,710 (1,031,283)
i)As at 30 June 2022 and 31 December 2021, the grouping of others are mainly interest
receivables from the Company's bank deposits. the Company’s interest receivable from cash
at bank mainly came state-owned banks and other medium or large size listed banks with
good reputation and high credit rating. Therefore, the Company expected there was no
significant loss on related interest receivable from non-performance by these banks.
Other receivables with provision on the grouping basis at Stage 3:：
127
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont’d)
30 June 2022 31 December 2021
Book Book
balance Provision for losses balance Provision for losses
Provision Provision
Amount ratio Amount Amount ratio Amount
Grouping of operating advances
and guarantees:
Over 1 year 52,938 4.00% (2,118) - - -
(c) For the six months ended 30 June 2022, The amount of bad debt provision was RMB2,118.,
The provision for bad debts amounted to RMB332,008 was reversed. because of the actual
receipt of Other receivables relating to the provision for bad debts made in the prior period.
(d) For the six months ended 30 June 2022, no other receivables were written off.
(e) As at 30 June 2022, the top five other receivables ranked by remaining balances are analysed
as follows:
Provision
% of total for bad
Nature Balance Ageing balance debts
Receivable for
subsidiary Within 1
Company 1 disposal 188,300,000 year 66.45% (564,900)
Advances
classified as Within 1
Company 2 expenses 13,853,696 year 4.89% (41,561)
Advances
classified as Within 1
Company 3 expenses 10,000,000 year 3.53% (30,000)
Current
accounts
receivable from
Company 4 subsidiaries 9,679,410 Over 1 year 3.42% -
Current
accounts
receivable from Within 1
Company 5 subsidiaries 5,212,844 year 1.84% -
227,045,950 80.13% (636,461)
128
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(3) Long-term equity investments
30 June 2022 31 December 2021
Subsidiaries (a) 2,807,943,493 2,756,943,493
Associates (b) 248,250,612 252,402,245
3,056,194,105 3,009,345,738
Less: Provision for impairment of long-term equity investments for subsidiaries (1,905,543,493) (1,905,543,493)
Provision for impairment of long-term equity investments for associates - -
(1,905,543,493) (1,905,543,493)
1,150,650,612 1,103,802,245
(a) Subsidiaries
Changes in the current period
Balance of
Other provision Cash
additions for impairment dividends
31 December Debt Provision for and 30 June in June 30 declared this
2021 Addition exemption impairment subtractions 2022 2022 period
JMCH 781,400,000 - - - - 781,400,000 (1,905,543,493) -
JMCS 50,000,000 - - - - 50,000,000 - -
SZFJ 10,000,000 - - - - 10,000,000 - -
GZFJ 10,000,000 - - - - 10,000,000 - -
Jiangling Ford
Technology (i) - 51,000,000 - - - 51,000,000 - -
851,400,000 51,000,000 - - - 902,400,000 (1,905,543,493) -
129
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(3) Long-term equity investments(Cont’d)
(a) Subsidiaries(Cont’d)
(i) In 2021, the Company and Ford Motor Company (“Ford”) subscribed to the capital contribution of RMB102,000,000 and 98,000,000 respectively to set up Jiangling
Ford Technology, the total registered capital subscribed amount to RMB200,000,000. The Company holds 51% of the shares of Jiangling Ford Technology and got the
control of Jiangling Ford Technology’s Board of Shareholders and Directors. Jiangling Ford Technology is the holding subsidiary of the Company.
As of June 30, 2022 , the industrial and commercial registration of Jiangling Ford Technology has been completed and has been put into operation; The paid in capital
of the company and Ford is RMB51,000,000 and RMB49,000,000 respectively.
(b) Associate
Movements for the current period
Cash
Share of net dividends Ending
31 profit/(loss) declared by balance of
December Increase in the under equity joint Provision for 30 June Shareholding Voting rights provision for
2021 current period method ventures impairment 2022 (%) (%) impairment
The Power Company 215,993,605 - (4,006,923) - - 211,986,682 40% 40% -
Hanon Systems 36,408,640 - (144,710) - - 36,263,930 19.15% 33.33% -
Total 252,402,245 - (4,151,633) - - 248,250,612
130
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(4) Revenue and cost of sales
Six months ended 30 June
2022 2021
Revenue from main operations 13,153,777,616 16,109,269,826
Revenue from other operations 235,587,202 314,288,655
13,389,364,818 16,423,558,481
Six months ended 30 June
2022 2021
Cost of revenue from main operations 11,688,319,077 14,248,936,203
Cost of sales from other operations 221,157,893 293,290,780
11,909,476,970 14,542,226,983
(a) Revenue and cost of sales from main operations
Six months ended 30 June
2022 2021
Cost of
Revenue from revenue from Cost of revenue
main main Revenue from from main
operations operations main operations operations s
Sales of
automobiles 12,104,498,465 10,873,199,856 15,039,210,401 13,448,227,943
Sales of
automobile
parts 1,024,913,088 803,494,300 983,532,314 742,735,696
Automobile
maintenance
services 24,366,063 11,624,921 86,527,111 57,972,564
13,153,777,616 11,688,319,077 16,109,269,826 14,248,936,203
(b) Revenue and cost of sales from other operations
Six months ended 30 June
2022 2021
Revenue from Cost of sales Cost of sales
other from other Revenue from from other
operations operations other operations operations
Sales of
materials 191,377,317 178,704,400 257,777,393 238,667,848
Others 44,209,885 42,453,493 56,511,262 54,622,932
235,587,202 221,157,893 314,288,655 293,290,780
131
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(4) Revenue and cost of sales (Cont’d)
(c) The breakdown of revenue earned For the six months ended 30 June 2022 was as follows:
Six months ended 30 June 2022
Automobile
maintenance Materials
Automobiles Automobile parts services and others Total
Revenue from main
operations 12,104,498,465 1,024,913,088 24,366,063 - 13,153,777,616
Including: Recognised at a
time point 12,104,498,465 1,024,913,088 - - 13,129,411,553
Recognised within
a certain period - - 24,366,063 - 24,366,063
Revenue from other
operations - - - 235,587,202 235,587,202
12,104,498,465 1,024,913,088 24,366,063 235,587,202 13,389,364,818
Six months ended 30 June 2021
Automobile Total
Automobile maintenance Materials
Automobiles parts services and others
Revenue from main 15,039,210,401 983,532,314 86,527,111 - 16,109,269,826
operations
Including: Recognised at a
time point 15,039,210,401 983,532,314 - - 16,022,742,715
Recognised
within a
certain period - - 86,527,111 - 86,527,111
Revenue from other
operations - - - 314,288,655 314,288,655
15,039,210,401 983,532,314 86,527,111 314,288,655 16,423,558,481
(i) As at 30 June 2022, the amount of revenue corresponding to the performance obligations
that the Group has signed but has not performed or has not yet performed is
RMB119,105,161, which the company will be recognized as revenue from the sale of
automobiles and parts in 2022.
(5) Investment income
Six months ended 30 June
2022 2021
Investment income from financial assets held for trading - 3,894,457
Investment loss from forward exchange settlement (10,728,178) (7,750,384)
Losses on discount of financing receivables eligible for
derecognition (6,704,092) (498,879)
Losses on long-term equity investments under equity
method (4,151,633) (264,201)
(21,583,903) (4,619,007)
There is no significant restriction on the remittance of investment income to the Company.
132
JIANGLING MOTORS CORPORATION, LTD.
SUPPLEMENTARY INFORMATION THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2022
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
1 Statement of non-recurring profit or loss
Six months ended 30 June
2022 2021
Government grants recognised in profit or
loss for the current period 261,059,234 335,052,961
Gains and losses arising from changes in
fair value of financial assets and liabilities
held at fair value through profit or loss,
and investment losses on disposal of
related financial assets and liabilities (4,174,119) (2,676,284)
Fund occupation fee received from non-
financial institutions 7,029,072 7,142,859
Gains/Losses on disposal of non-current
assets 395,312,262 11,008,608
Reversal of provision for impairment of
receivables tested individually 110,068 2,000,000
Net amount of other non-operating
income and expenses 1,762,148 68,869
Other items of profit or loss conforming to
the definition of non-recurring profit or
loss - (5,423,293)
661,098,665 347,173,720
Effect of income tax (100,191,259) (55,801,540)
Effect of gains and losses on minority
interests (net of tax) (91,808) -
560,815,598 291,372,180
Basis for preparation of statement of non-recurring profit or loss
Under the requirements in the Explanatory Announcement No. 1 on Information
Disclosure by Companies Offering Securities to the Public - Non-recurring Profit or Loss
[2008] from CSRC, non-recurring profit or loss refers to that arises from transactions and
events that are not directly relevant to ordinary activities, or that are relevant to ordinary
activities, but are extraordinary and not expected to recur frequently that would have an
influence on users of financial statements making economic decisions on the financial
performance and profitability of an enterprise.
2 Return on net assets and earnings per share
Weighted average Earnings per share
return on net assets Basic earnings per Diluted earnings
(%) share per share
Six months ended 30 June
2022 2021 2022 2021 2022 2021
Net profit attributable to
ordinary shareholders
of the Company 5.02% 3.62% 0.52 0.47 0.52 0.47
Net profit attributable to
ordinary shareholders
of the Company, net of
non-recurring profit or
loss -1.20% 1.02% (0.13) 0.13 (0.13) 0.13
133
