Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wafangdian Bearing Company Limited
2023 Annual Report
2024-03
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter I. Important Prompts, Table of Contents, and Definitions
The board of directors, board of supervisors, directors, supervisors and senior managers of the company shall
guarantee that the contents of the annual report are true, accurate and complete without false records, misleading
statements or major omissions, and shall bear individual and joint legal liabilities.
Company responsible person Liu Jun, responsible person in charge of accounting work Sun Najuan and
responsible person in charge of accounting organization Sun Xinyan statement: ensure that the financial report in
this annual report is true, accurate and complete.
All directors have attended the Board meeting at which this report was considered.
The company describes in detail the possible risks and countermeasures in the operation of the company in
section III "Management Discussion and Analysis" and "XI, The Company's Future Development Outlook".
Please pay attention to the relevant contents.
The company plans not to distribute cash dividend, not to send bonus shares, not to increase capital by
provident fund
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Catalogue
Chapter I. Important Prompts, Table of Contents, and Definitions .......................................................... 2
Chapter II. Company Profile and Financial Highlights ............................................................................... 6
Chapter III. Management discussion and analysis .....................................................................................10
Chapter IV Corporate Governance .............................................................................................................. 23
Chapter V Environmental and social responsibility ................................................................................... 40
Chapter VI Important items ..........................................................................................................................45
Chapter VII Share changes and shareholders ............................................................................................. 49
Chapter ⅦI. About the Preferred Shares .................................................................................................. 53
Chapter IX. Related information of convertible bonds .............................................................................. 53
Chapter X Financial report .......................................................................................................................... 53
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
File directory for reference
1. Financial statements (bearing the stamp of the person in charge of the company, the person in charge of
accounting work and the person in charge of accounting institution)
2. Original audit report (containing seal of accounting firm and signature and seal of certified public accountant)
4
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Glossary
Terms Defined as Description
Company,the Company Defined as Wafangdian Bearing Company Limited
Wazhou Group Defined as Wafangdian Bearing Group Company
the report period, the current period, the
Defined as January 1,2023–December 31,2023
current year
Wazhou Liaoyang Bearing Manufacture
Liaozhou Co.,Ltd Defined as
Co.,Ltd
Dalian motor Defined as Dalian motor Bearing Co.,Ltd
Wazhou Precision spherical Roller Bearing
Spherical company Defined as
(Wafangdian) Co., LTD
Wafangdian Bearing Company Limited The
The Board of Directors Defined as
Board of Directors
Wafangdian Bearing Company Limited The
The Supervisory Committee Defined as
Supervisory Committee
Wafangdian Bearing Co., LTD. General
General meeting of shareholders Defined as
meeting
Shen Jiao Suo Defined as Shen Zhen Stock Exchange
SRC Defined as China Securities Regulatory Commission
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter II. Company Profile and Financial Highlights
I. Company Information
II.Contacts
Abbreviated name of the stock Wazhou B Stock code: 200706
Listing location of the
Shenzhen Stock Exchange
Company”s stock:
Chinese name of the
瓦房店轴承股份有限公司
Company
Abbreviation of Chinese
瓦轴股份公司
name
Legal representative of the
Liu Jun
Company
Registered address No. 1 Beigongji Street, Wafangdian City, Liaoning Province, China.
P.C 116300
Historical change of
registered address of the Did not change
company
office address No. 1 Beigongji Street, Wafangdian City, Liaoning Province, China.
office P.C 116300
Website http//www.zwz-200706.com
E-mail zwz2308@126.com
II.Contacts
Secretary of the Board Representative of Stock Affairs
Name Sun Najuan Ke Xin
No. 1 Beigongji Street, No. 1 Beigongji Street,
Correspondence address Wafangdian City, Liaoning Wafangdian City, Liaoning
Province, China. Province, China.
Consulting telephone 0411-62198008 0411-62198236
Fax 0411-62198333 0411-62198333
E-mail zwz2308＠126.com zwz2308＠126.com
III.Place for information disclosure
Web address for the annual report as
http://www.cninfo.com.cn
assigned by CSRC.
Information disclosure newspapers Securities Times Newspaper
Place for inquiry of the annual report Investment and Securities Department of the Company
IV.Change of Business Registration
No. of Taxation Registration 912102002423997128
Change of main business since listed None
Change of controlling shareholder all
None
previous(if any)
V. Other relevant information
The accounting firm employed by the company
Shu Lun Pan Certified Public Accountants (Special General
Name of accounting firm
Partnership)
Address of the CPA 4F, No.61 East Nanjing Road, Huangpu District, Shanghai
The name of accountants Cui Song, Guo Yaowu
Sponsoring institution hired by the Company, which is responsible to overseeing the Company’s operation on a
continuous basis:
□ Applicable Inapplicable
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Financial consultancy institution hired by the Company, which is responsible to overseeing the Company’s
operation on a continuous basis:
□ Applicable Inapplicable
VI.Main accounting data and financial indicators
Whether the company needs to retroactively adjust or restate the accounting data of previous years
□ Yes No
Compare with last
2023 2022 2021
year(+/-)
2,318,704,350.3
Operating income (Yuan) 2,193,273,682.20 2,348,330,561.57 -6.60%
5
Net profit attributable to
shareholders of listed -99,478,593.08 -139,897,498.87 28.89% -205,737,685.42
companies (Yuan)
Net profit attributable to
shareholders of listed
companies after deducting -129,316,113.23 -164,201,263.44 21.25% -218,739,881.32
non-recurring gains and
losses (Yuan)
Net cash flow from
84,322,692.15 84,265,549.90 0.07% 77,678,162.48
operating activities (Yuan)
Basic earnings per share
-0.2471 -0.3475 28.89% -0.5110
(RMB/share)
Diluted earnings per share
-0.2471 -0.3475 28.89% -0.5110
(RMB/share)
Weighted average return
-23.64% -25.99% 2.35% -28.93%
on equity
More or less at the
end of this year At the end
At the end of2023 At the end of2022
than at the end of of2021
the previous year
3,220,126,105.0
Total assets (Yuan) 3,180,391,222.98 3,324,777,599.86 -4.34%
1
Net assets attributable to
shareholders of listed 371,306,068.15 470,302,993.46 -21.05% 608,267,282.47
companies (Yuan)
The company's net profit before and after deducting non-recurring gains and losses in the last three fiscal years is
negative, and the audit report of the last year shows that the company's ability to continue operating is uncertain
□ Yes No
After the net profit before deducting the non-recurrent gains and losses and the net profit after deducting the non-
recurrent gains and losses are compared, who is low who is negative
Yes No
project 2023 2022 remark
Operating income (Yuan) 2,193,273,682.20 2,348,330,561.57 -
Deduct scrap income of
20443565.23 yuan, deduct material
Amount deducted from income of 7634502.64 yuan, deduct
99,691,310.82 242,611,882.14
operating income (Yuan) rental income of 20340623.37
yuan, deduct commission income
of 512,72619.58 yuan.
Amount after deduction of
2,093,582,371.38 2,105,718,679.43 -
operating income (Yuan)
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
VII. Differences in accounting information under IAS and domestic accounting standard
1. Differences in net profit and net asset under domestic and international accounting standards
□ Applicable Inapplicable
2. Differences in net profit and net asset under domestic and overseas accounting standards
□ Applicable Inapplicable
VIII. Financial Data Summary based on Quarters
In RMB Yuan
In the second
In the first quarter In the third quarter In the forth quarter
quarter
Operating revenue 605,154,931.63 646,884,417.97 520,405,589.54 420,828,743.06
Net profit attributable
to the
-22,736,404.65 -12,641,256.51 -5,327,783.82 -58,773,148.10
Company’s
shareholders
Net profit attributable
to the
Company’s
-27,072,214.12 -17,758,189.63 -10,141,352.34 -74,344,357.14
shareholders less
the non-recurring
profit and loss
Net cash flows
arising from -97,995,389.08 -125,243,261.60 88,757,751.54 218,803,591.29
operating activities
Does there exist significant difference in the foregoing financial data or their total sum from the relevant financial
data as disclosed in the quarterly reports and/or semi-annual report.
□ Yes No
IX. Non-recurring gain/loss items and amounts
Applicable Inapplicable
In RMB Yuan
Amount of Amount of
item Amount of 2023 instructions
2022 2021
Gain or loss on disposal of illiquid assets
(including the write-off of the asset 1,406,119.64 2,110,473.61 2,349,507.64
impairment provision)
Government subsidies included in the
profit and loss of the current period
(closely related to the normal operation of
the company, in line with national
policies and provisions, in accordance 10,623,570.13 7,068,347.57 8,117,365.44
with the defined standards, except
government subsidies that have a
continuous impact on the profit and loss
of the company)
In addition to the effective hedging
business related to the normal operation
of the company, the profit or loss of fair
value changes arising from the holding of
-29,276.17 -78,583.43 612,813.05
financial assets and financial liabilities by
non-financial enterprises and the loss or
gain arising from the disposal of financial
assets and financial liabilities
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Allowance for impairment reversal of
receivables tested separately for 10,243,668.21 9,541,570.95
impairment
Gains and losses on debt restructuring 10,935,641.78 6,892,627.00 1,808,922.83
Other non-operating income and
expenditure other than those mentioned 158,222.87 3,271,652.69 2,694,297.36
above
Other items of profit and loss that
2,000,000.00
conform to non-recurring profit and loss
Less: Income tax impact 5,500,426.31 4,502,323.82 2,580,710.42
total 29,837,520.15 24,303,764.57 13,002,195.90 --
Details of other profit and loss items that meet the definition of non-recurring profit and loss:
□ Applicable Inapplicable
The Company does not have any other profit and loss items that meet the definition of non-recurring profit and
loss.
Define the non-recurring profit and loss items listed in the Explanatory Notice of Information Disclosure of
Companies publicly issuing Securities No. 1 -- Non-recurring Profit and loss items as the statement of the current
profit and loss items
□ Applicable Inapplicable
The Company does not define the non-recurring profit and loss items listed in the Explanatory Notice of
Information Disclosure for Publicly Issued Securities No. 1 -- Non-recurring Profit and loss items as recurring
profit and loss items.
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter III. Management discussion and analysis
I. Industry situation of the Company during the reporting period
The company is a leading listed company in domestic bearing manufacturing and has participated in the
formulation of a number of standards in the industry.
At present, the domestic high-end bearing market is still occupied by foreign brands, overseas enterprises and
domestic advanced bearing enterprises are accelerating the investment layout, and the competition situation is
further heated. However, opportunities and challenges remain, China's economy continues to maintain a steady
growth trend, macroeconomic policies continue to remain positive and stable, and the long-term fundamentals of
the economy and the factors supporting high-quality development have not changed. Fiscal, monetary, industrial
and other policies will continue to exert their strength and strengthen coordination. Driven by factors such as
increasing domestic demand, slight improvement in external demand and export, and accelerated formation of
new quality productivity, the economy is expected to further stabilize and recover.
II. Main business of the Company during the reporting period
The business scope of the company is licensed items: inspection and testing services, import and export of goods,
import and export of technology (items subject to approval according to law, business activities can be carried out
only after approval by relevant departments, specific business items subject to approval results) general items:
Bearing manufacturing, bearings, gears and transmission components manufacturing, high speed precision heavy-
duty bearing sales, sales bearings, gears and transmission parts, bearing sales, general equipment manufacturing
(excluding special equipment manufacturing), high-speed rail equipment, parts manufacturing, machinery and
equipment sales, rail transportation equipment, key system and parts sales, sales of lubricating oil, high-speed rail
equipment and accessories sales, Wind generators and spare parts sales, machinery parts, spare parts sales, railway
locomotive vehicle accessories manufacturing, railway locomotive vehicle accessories sales, auto parts and
accessories manufacturing, auto parts wholesale and retail auto parts, metal products repair, sales metal materials,
metal products sales, metal surface treatment and heat treatment processing, quenching process, Mechanical parts
and spare parts processing, land use right leasing, housing leasing, non-residential real estate leasing, mechanical
equipment leasing, computer and communication equipment leasing, transportation equipment leasing service,
office equipment leasing service, storage equipment leasing service, special equipment leasing, labor service
(excluding labor dispatch), Technical services, technology development, technology consultation, technology
exchange, technology transfer and technology popularization (except for projects subject to approval according to
law, independently carry out business activities according to law with business license)
The company has strong manufacturing capacity and quality assurance ability, widely serve railway, metallurgy,
mining and other industries and fields.
III.Analysis of core competitiveness
As the largest bearing technology and product research and development and manufacturing base in China, the
company has accumulated many years of practical experience in bearings and related fields, established a sound
bearing technology innovation system, and maintains close cooperation with domestic research institutes and
universities. As the main drafter of several standards in the bearing industry, it has mastered the latest technical
trends in the development of the industry. It has established significant advantages in technology research and
development, product manufacturing, marketing and user service.
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
The company's personalized design and manufacturing process for customers can take into account cost, delivery
time and customer needs, improving the ability to respond to the market and customer personalized needs.
The company has a complete product service system, with all-weather dynamic service capabilities for product
operation site. And with the "ten value-added services" good image by the majority of customers praise. The
company has a strong manufacturing capacity and quality assurance capabilities, a wide range of services in
railway, metallurgy, mining and other industries and fields.
At present, the company has established strategic cooperative relations with key customers in the field of domestic
equipment application, and carried out in-depth marketing through the involvement of customer value engineering,
firmly established the company's brand and influence in the domestic bearing market. In the international market,
the company has obtained the certification qualification of important target markets, and the international
reputation has been preliminarily established.
IV. Analysis of main business
1.overview
2023 is the year of accelerating global economic divergence. The world economic recovery is sluggish, global
inflation remains high, the spillover effects of tight monetary policies of major economies are prominent,
geopolitical conflicts are intensifying, unilateralism and trade protectionism are on the rise, and the international
environment is becoming more complex and grim. The domestic economy has been developing in waves,
zigzagging forward, and recovering to the good at the same time, it also faces insufficient effective demand, weak
social expectations and some cyclical and structural problems. For the bearing industry, multiple risk factors such
as increased volume in the industry and insufficient consumption power continue to test the enterprise's anti-risk
ability, strategic focus and development resilience.
In the face of complex external environment and severe industry competition environment, during the reporting
period, the company continued to take the sustainable development of "seeking progress in stability and quality in
stability" as the core, adhere to the high-quality development of the enterprise in the overall situation of the
construction of a strong country and national rejuvenation, in the revitalization of Northeast China and industry-
led exploration, and adhere to high-quality development.
In 2023, the company's main production and operation indicators are achieved as follows:
During the reporting period, the company achieved annual operating income of 2.19 billion yuan, down 6.6%
year-on-year. Although it did not complete the annual operating income target, it maintained the resilience of
performance and better controlled operating risks and costs and expenses. Net profit was minus 99 million yuan, a
reduction of 40 million yuan over the previous year. Total assets of 3.18 billion yuan, down 4.3% year-on-year;
Net assets of 370 million yuan, down 21.0% year-on-year.
2. Revenue and cost
(1) Composition of operating revenue
Unit：yuan
2023 2022
Year-on-year
Proportion in the Proportion in the increase/decrease
Amount Amount
operating revenue operating revenue
Total operating
2,193,273,682.20 100% 2,348,330,561.57 100% -6.60%
revenue
Classified based on sectors
exit 180,093,365.40 8.21% 216,679,504.65 11.42% -16.88%
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Traffic bearing 390,584,082.35 17.81% 408,899,268.24 21.54% -4.48%
Special bearing 797,640,051.38 36.37% 766,000,221.77 40.36% 4.13%
Universal bearing 650,817,472.74 29.67% 654,108,114.83 34.46% -0.50%
Industrial
74,447,399.51 3.39% 60,031,569.94 3.16% 24.01%
operation
Other business 99,691,310.82 4.55% 242,611,882.14 12.78% -58.91%
Classified based on product
bearing 2,019,134,971.87 92.06% 2,045,687,109.49 107.79% -1.30%
Industrial
74,447,399.51 3.39% 60,031,569.94 3.16% 24.01%
operation
Other business 99,691,310.82 4.55% 242,611,882.14 12.78% -58.91%
Classified based on regions
domestic 2,013,180,316.80 91.79% 2,131,651,056.92 112.32% -5.56%
abroad 180,093,365.40 8.21% 216,679,504.65 11.42% -16.88%
Classified by sales model
(2) The industry, product, region and sales mode accounting for more than 10% of the company's
operating revenue or operating profit
Applicable Inapplicable
Unit:yuan
Operating
Operating costs
income was Gross margin
Operating Gross profit increased or
Operating cost up or down was up or down
income margin decreased from
from a year from a year ago
a year earlier
earlier
Classification by industry
exit 180,093,365.40 162,756,753.10 9.63% -16.88% -20.25% 3.82%
Traffic bearing 1,839,041,606.47 1,560,781,777.11 15.13% 0.55% 7.63% -5.58%
Special bearing 390,584,082.35 342,540,976.43 12.30% -4.48% 11.04% -12.25%
Universal
797,640,051.38 612,926,045.89 23.16% 4.13% 4.25% -0.08%
bearing
Industrial
650,817,472.74 605,314,754.79 6.99% -0.50% 9.32% -8.36%
operation
Other business 74,447,399.51 48,814,579.53 34.43% 24.01% -20.35% 36.51%
Classification by product
bearing 2,019,134,971.87 1,723,538,530.21 14.64% -1.30% 4.19% -4.49%
Industrial
74,447,399.51 48,814,579.53 34.43% 24.01% -20.35% 36.51%
operation
Other business 2,093,582,371.38 1,772,353,109.74 15.34% 762.93% 871.82% -9.49%
Classification by regions
domestic 1,913,489,005.98 1,609,596,356.64 15.88% -10.23% -4.97% -4.66%
abroad 180,093,365.40 162,756,753.10 9.63% -16.88% -20.25% 3.82%
Classified by sales model
If the statistical caliber of the company's main business data is adjusted during the reporting period, the company's
main business data in the recent year shall be adjusted according to the caliber at the end of the report
Applicable Inapplicable
(3) Whether the company's income from physical sales is greater than the income from labor service
yes no
Industry Compared with
item unit 2023 2022
classification last year(+/-)
sales Set 16,953,678 24,262,634 -30.12%
bearing production Set 17,047,588 16,105,384 5.85%
inventory Set 11,265,595 11,171,685 0.84%
Causes of the change in the year-on-year data by over 30%
Applicable Inapplicable
The structure of the type of bearings sold this year has changed
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
The current production of medium and large products than major, on the other hand, to reduce inventory
(4) Implementation of Important Sale Contracts Concluded at the End of the Reporting Period
□ Applicable Inapplicable
(5) Composition of Operating Costs
Classified based on sectors and products
Unit :yuan
2023 2022
Proportion
Product item Proportion in Year-on-year
in
classification Amount Amount operating (+/-)
operating
costs
costs
bearing 1,723,538,530.21 94.66% 1,654,249,908.29 87.16% 4.19%
Among them:
bearing 1,235,251,066.43 67.84% 1,185,963,973.00 62.49% 4.16%
raw materials
bearing Labor cost 204,515,259.44 11.23% 175,005,159.32 9.22% 16.86%
bearing depreciation 46,058,646.26 2.53% 50,331,285.07 2.65% -8.49%
Energy
bearing 60,160,451.99 3.30% 60,813,468.10 3.20% -1.07%
consumption
bearing other 177,553,106.09 9.75% 182,136,022.80 9.60% -2.52%
Industrial
48,814,579.53 2.68% 61,282,708.93 3.23% -20.35%
operation
Other business 48,356,855.55 2.66% 182,374,798.19 9.61% -73.48%
total 1,820,709,965.29 100.00% 1,897,907,415.41 100.00% -4.07%
Instructions
The main product of the company is bearings, whose cost accounts for 94.66% of operating costs. Bearing costs
are mainly composed of raw materials, labor costs, depreciation, energy consumption and other items, accounting
for 67.84%, 11.23%, 2.53%, 3.3%, 9.75%, respectively. The rising cost of bearings is mainly caused by the rising
cost of raw materials and labor costs.
(6) Is there any change in the consolidation scope in the reporting period
□ Yes No
(7) Is there any significant change or adjustment related situation take place in the Company’s business,
products or services in the reporting period
□ Applicable Inapplicable
(8) Major trade debtors and major suppliers
The company mainly sells customer information
Total sales amount of top five customers (Yuan) 735,492,940.02
The total sales amount of the top five customers accounts for the total annual sales 33.53%
Proportion of related party sales of top five customers in total annual sales 21.94%
Company's top 5 major customer information
Percentage of total
No. Customer name Sales (Yuan)
annual sales
Customer 1 (Consolidated list
1 of customers controlled by 417,489,620.09 19.03%
the same actual controller)
2 Customer 2 134,271,347.96 6.12%
3 Customer 3 80,909,262.72 3.69%
4 Customer 4 63,824,668.96 2.91%
5 Customer 5 38,998,040.29 1.78%
Total -- 735,492,940.02 33.53%
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Other information of major customers
□ Applicable Inapplicable
Company's major suppliers
Total Purchase Amount of Top 5 Suppliers (RMB) 1,123,121,914.81
The total purchase amount of the top five suppliers accounts for the
60.21%
proportion of the total annual purchase
The proportion of the purchase amount of related parties in the total annual
52.43%
purchase amount of the top five suppliers
Profiles of top 5 suppliers
Amount of Percentage in total
Serial number Supplier name
purchase(RMB) purchase of year(%)
Supplier 1 (Consolidated
list of customers
1 978,145,743.67 52.43%
controlled by the same
actual controller)
2 Supplier 2 41,976,906.99 2.25%
3 Supplier 3 40,204,925.31 2.16%
4 Supplier 4 36,575,290.00 1.96%
5 Supplier 5 26,219,048.84 1.41%
total -- 1,123,121,914.81 60.21%
Other information of major suppliers
□ Applicable Inapplicable
3. Expenses
In RMB Yuan
Year-on-year Note to significant
2023 2022
increase/decrease changes
Sales expenses 159,770,917.31 162,537,964.38 -1.70%
Administrative
127,607,078.59 115,099,647.00 10.87%
expenses
Financial expenses 36,140,344.21 31,407,471.87 15.07%
R&D expenses 157,836,380.65 231,245,330.98 -31.75%
4. Investment in R & D
Applicable Inapplicable
Expected
impact on the
Name of main Project
Project purpose The goal to be achieved company's
R&D project progress
future
development
Realize the structure and
performance design
The development of high
method of the main shaft
Technology power fan spindle tapered
Implement and bearing of more than 3
research and bearing is currently the
complete MW high-power fan,
manufacturing mainstream at home and Increase
according to break through the key
of large wind abroad, and it is necessary to market share
the project technologies of bearing
power spindle complete the domestic
plan machining, organization
bearings replacement as soon as
regulation and
possible.
performance testing, form
the design criteria and
14
Wafangdian Bearing Co., Ltd. 2023 annual report full text
manufacturing technical
specifications, greatly
improve the design and
manufacturing level of
China's fan main shaft
bearing, and promote the
localization of high-
power fan main shaft
bearing.
Steel hot rolling, cold rolling
bearing market demand, The service life of the
bearing capacity is large, main technical indicators
high precision requirements. can reach more than 7800
At present, the domestic Implement and hours; The product
Steel hot
bearing raceway is easy to complete accuracy is stable to P5
rolling, cold roll Increase
fatigue, roller fragmentation, according to level; The rolling line
system bearing market share
resulting in low service life, the project speed can reach
development
the need for technical plan 1000m/min; Product
research, increase research quality reliability
and development efforts, increased to more than
improve bearing quality, to 98%;
replace imported bearings.
The main bearing types of
Cement roller Key research directions:
roller bearing products are
bearing 1. Improve the position
spherical bearings and four- Implement and
technology and shape accuracy of the
row cylindrical bearings. In complete
quality raceway size to ensure the Increase
order to improve the service according to
improvement stability of the size; 2, market share
life and reliability of the project
and research improve the heat
bearings, the bearing plan
and treatment quality of the
development and key parts
manufacture working surface.
are improved and optimized.
Large high-end precision
machine tool bearings are
used with high-end machine
Large high-end The dimensional accuracy
tools, the processing control Implement and
precision of the product reaches P5
is strict, the shape and complete
machine tool level or above, and the Increase
position tolerance level is according to
bearing research reliability and rotation market share
high, the microscopic the project
and accuracy of the product
accuracy of the bearing is plan
development are improved.
strict, and high-precision
instruments are required to
detect.
Rolling mill four row
tapered bearings are mostly
used for rolling mill work
Development of Implement and
rolls, with high load bearing, 1, the required life of
four-row complete
high speed, fatigue more than 6000 hours; 2, Increase
tapered bearing according to
resistance, high reliability the product accuracy market share
for long life the project
requirements, long life, need reaches P5 level or above.
rolling mill plan
to improve the quality of
bearings, domestic
replacement
The use of advanced heat Through the control of
Research and Implement and
treatment technology, so that raceway curvature and
manufacture of complete
the product stability and life position in grinding Increase
precision according to
is reliable; Through the process, the sorting of market share
angular contact the project
grinding process technology sealing process, and the
ball bearings plan
research, master precision optimization of assembly
15
Wafangdian Bearing Co., Ltd. 2023 annual report full text
angular contact ball bearing process, the precision
raceway grinding angular contact ball
technology, super lapping bearing assembly
technology, curing technology is broken
processing technology; The through.
micro-geometric precision
control technology of
precision angular contact
ball bearing raceway is
studied. Solve the problem
of cleanliness in the
assembly process, and study
the non-destructive sealing
technology.
Through the research of
high-performance
insulation coating/locking
technology of insulated
bearings, the research of
bearing insulation
performance and life
acceleration test methods,
High power track traction and the research of
motor, wind turbine and high bearing insulation coating
power industrial motor low-damage and high-
insulation bearings in the precision manufacturing
High Implement and
domestic application blank, technology, the key
performance complete
bearing insulation technologies of high- Increase
motor insulated according to
coating/lock layer performance composite market share
bearing the project
preparation, grinding insulation coating, such as
technology plan
processing and insulation spraying, grinding,
performance test technology locking film and testing,
lack, need to fill the are broken through, and
domestic blank the high-performance
composite insulation
coating material is
applied to insulated
bearings. Meet the
application requirements
of insulated motor
bearing under complex
working conditions.
Reformulate the drawing
of the ring quench parts to
Optimize the oil groove Implement and ensure the stability of the
coordinates of bearing inner complete quench parts, and solve
Wind power Increase
ring, improve bearing according to the influence of the
gearbox bearing market share
bearing capacity and prolong the project uneven quench parts on
bearing life. plan the chamfer and the
coordinate size of the oil
groove.
Company r & D personnel
2023 2022 Changes in the proportion
Number of R&D personnel (people) 386 295 30.85%
The proportion of R&D personnel 15.27% 12.18% 3.09%
Educational structure of R&D personnel
16
Wafangdian Bearing Co., Ltd. 2023 annual report full text
undergraduate 82 34 141.18%
Master's degree 10 4 150.00%
Age composition of R&D personnel
Under 30 years old 57 30 90.00%
30 to 40 years old 115 93 23.66%
R&d investment of the company
2023 2022 Changes in the proportion
R&d investment amount (Yuan) 157,836,380.65 231,245,330.98 -31.75%
R&d investment as a percentage of
7.20% 9.85% -2.65%
revenue
Capitalized amount of R&D
0.00 0.00
investment (Yuan)
Capitalized R&D investment as a
0.00% 0.00%
percentage of R&D investment
Causes and impacts of major changes in the composition of r&d personnel
□ Applicable Inapplicable
The reason for the significant change in the proportion of total R&D investment to revenue over the previous year
□ Applicable Inapplicable
The reason of the large change of capitalization rate of R&D investment and its rationality explanation
□ Applicable Inapplicable
5.Cash flow
Unit:yuan
item 2023 2022 Year-on-year (+/_)
Subtotal of cash inflows from
1,047,810,865.53 1,277,527,933.41 -17.98%
operating activities
Subtotal of cash outflow from
963,488,173.38 1,193,262,383.51 -19.26%
operating activities
Net cash flow from operating
84,322,692.15 84,265,549.90 0.07%
activities
Subtotal of cash inflows from
2,471,723.34 1,796,661.89 37.57%
investment activities
Subtotal cash outflow from
5,430,485.57 12,861,168.20 -57.78%
investment activities
Net cash flow from investment
-2,958,762.23 -11,064,506.31 73.26%
activities
Subtotal of cash inflows from
1,362,194,933.95 1,166,898,875.78 16.74%
financing activities
Subtotal cash outflows from
1,563,267,998.54 1,225,043,749.57 27.61%
financing activities
Net cash flows from financing
-201,073,064.59 -58,144,873.79 -245.81%
activities
Net increase in cash and cash
-116,692,730.74 17,509,394.95 -766.46%
equivalents
Causes and impacts of major changes in the composition of r&d personnel
□ Applicable Inapplicable
The reason for the significant change in the proportion of total R&D investment to revenue over the previous year
17
Wafangdian Bearing Co., Ltd. 2023 annual report full text
□ Applicable Inapplicable
The reason of the large change of capitalization rate of R&D investment and its rationality explanation
□ Applicable Inapplicable
V.Analysis of Non-Core Business Operations
Unit:yuan
Proportion of Whether it is
Amount Causes of formation
total profits sustainable
Investment income 12,935,641.78 -13.00% Debt restructuring No
The impact of changes in the market
Gain or loss on
-29,276.17 0.03% price of Chongqing Iron and Steel No
changes in fair value
stocks held
Impairment of receivables,
-
Asset impairment 24.88% inventories, fixed assets, No
24,761,343.96
construction in progress, etc
Penalty income and unpayable
Non-operating income 603,316.44 -0.61% No
payments are written off
Expenditure on fines, losses from
Non-operating
445,093.57 -0.45% the scrapping of non-current assets, No
expenses
etc.
VI. Situation of assets and liabilities
1. Major change in asset items
Unit：yuan
At the end of the year 2023 At the beginning of the year 2023 The Notes on
Percentage of Percentage of total proportion Major
Amount Amount (+/_) Changes
total assets assets
Monetary funds 210,814,228.05 6.63% 330,746,706.88 9.95% -3.32%
Accounts
1,086,438,008.68 34.16% 1,136,295,329.59 34.18% -0.02%
receivable
Contract assets 5,565,143.57 0.17% 601,375.84 0.02% 0.15%
stock 651,494,088.99 20.48% 646,619,143.91 19.45% 1.03%
Investment real
68,614,653.76 2.16% 67,211,806.69 2.02% 0.14%
estate
Fixed assets 448,651,044.66 14.11% 391,769,315.64 11.78% 2.33%
Construction in
37,354,969.68 1.17% 81,891,139.54 2.46% -1.29%
progress
Short-term loan 598,000,000.00 18.80% 699,000,000.00 21.02% -2.22%
Contractual
30,546,735.85 0.96% 30,449,983.07 0.92% 0.04%
liability
Long-term loan 99,450,000.00 3.13% 3.13%
Foreign assets account for a relatively high proportion
Applicable Inapplicable
2.Assets and liabilities measured at fair value
Applicable Inapplicable
Unit：yuan
Current fair
Accumulated Impairme
value Current Current
Ending changes in nt of the Other The final
item change Purchase Sale
balance fair value of current changes number
profit and Amount Amount
equity period
loss
18
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Financial assets
1.
Transaction
al financial
assets
243,454.50 -29,276.17 -352,854.97 214,178.33
(excluding
derivative
financial
assets)
Subtotal of
financial 243,454.50 -29,276.17 -352,854.97 214,178.33
assets
Receivable 30,996,930. 24,549,544.2 55,546,474.
s financing 63 4 87
31,240,385. 24,549,544.2 55,760,653.
Above total -29,276.17 -352,854.97
13 4 20
Financial
0.00 0.00
liability
Other changes：the amount of receivables financing increase
Whether the measurement attribute of the company's main assets has changed significantly during the reporting
period
□ Yes No
3.Limitation of asset rights by the end of the report
End of term At the end of last year
item
Book Restricted Restricted Book Restricte Restricted
Book value Book value
balance type case balance d type case
Other Bank Other Bank
Monetary 42,939,82 75,389,415. 75,389,415.5
42,939,828.07 monetary acceptanc monetar acceptance
funds 8.07 51 1
funds e deposit y funds deposit
Other Letter of Other Letter of
Monetary 56,400,00 28,000,000. 28,000,000.0
56,400,000.00 monetary credit monetar credit
funds 0.00 00 0
funds deposit y funds deposit
Other
Monetary 809,839.3 Guarantee
809,839.35 monetary
funds 5 money
funds
Finance Commerci
Notes 2,982,604. company Pledge of 20,228,644. 20,228,644.0 Pledge al
2,982,604.41
receivable 41 acceptanc bill 00 0 of bill acceptance
e bill pledge
Commerc
Notes 14,770,61 ial Pledge of
14,770,614.03
receivable 4.03 acceptanc bill
e
Banker's
Financing of 10,000,00 Pledge of
10,000,000.00 acceptanc
receivables 0.00 bill
e
127,902,8 123,618,059 123,618,059.
total 127,902,885.86
85.86 .51 51
V. Investment
1. General situation
□ Applicable Inapplicable
2.Significant equity investments obtained during the reporting period3. Major ongoing non-equity
investments during the reporting period
□ Applicable Inapplicable
3.Significant non-equity investment in process in the reporting period
19
Wafangdian Bearing Co., Ltd. 2023 annual report full text
□ Applicable Inapplicable
4. Financial asset investment
(1) securities investment
Applicable Inapplicable
Unit :yuan
Accu
Curre Profit
mulat
The Accou nt fair Curre and
Initial ed Curre
Variet abbre nting value nt loss Endin Accou Sourc
Variet cost Initial chang nt
ies of viatio measu chang Purch during g nting es of
ies of of book es in Sale
securi n of remen e ase the book subjec fundin
code invest value fair Amou
ties securi t profit Amou report value t g
ment value nt
ties model and nt ing
of
loss period
equity
Dome
Chon Fair Tradi
stic
gqing value - - - ng debt-
and 60100 567,0 243,4 214,1
iron measu 29,27 352,8 0.00 0.00 29,27 financ for-
foreig 5 33.30 54.50 78.33
and remen 6.17 54.97 6.17 ial equity
n
steel t assets
stocks
- - -
567,0 243,4 214,1
total -- 29,27 352,8 0.00 0.00 29,27 -- --
33.30 54.50 78.33
6.17 54.97 6.17
(2)derivatives investment
□ Applicable Inapplicable
There is no derivative investment during the reporting period.
5.Use of the raised funds
□ Applicable Inapplicable
No use of the raised funds during the company's reporting period.
VIII. Sales of Significant Assets and Equity
1. Sales of Significant Assets
□ Applicable Inapplicable
2. Sales of Significant Equity
□ Applicable Inapplicable
IX. Analysis on Principal Subsidiaries and Mutual Shareholding Companies
□ Applicable Inapplicable
Particulars about the principal subsidiaries and mutual shareholding companies which may affect the Company’s
net profit by over 10%.
In RMB Yuan
Company Compa Principal registered Operating operating
total assets net asset net profit
name ny type business capital income profit
Product and Sale - - -
Liaoyang
Subsidi Bearing and 219,740,58 178,026,16
Bearing 19350000 68,235,4 2,929,792.6 2,939,839.6
ary machine-electrical 2.78 8.54
company 28.23 6 3
equipment
Product and Sale - - -
Dalian
Subsidi Bearing and 10,000,00 141,605,92 182,846,18
Electrical 72,171,3 25,186,767. 25,422,020.
ary machine-electrical 0.00 0.95 6.04
Equipment 52.97 91 09
equipment
Wzhou
precision
Product and Sale - -
spherical
Subsidi Bearing and 194,000,0 259,924,74 131,867, 260,463,55
roller 23,629,785. 23,638,429.
ary machine-electrical 00.00 2.18 563.88 3.42
bearing(Wa 58 33
equipment
fangdian)
Co.,Ltd.
20
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Acquisition and disposal of subsidiaries during the reporting period
□ Applicable Inapplicable
Description of the main holding and shareholding companies
X.A structured entity controlled by a company
□ Applicable Inapplicable
XI.The prospect of the company's future development
The company's future development strategy is: marketing pull, starting from product application, to achieve
design, application, price differentiation, product differentiation, to create a series of high-end brands, and
ultimately to achieve high-quality development of enterprises.
XII. Statement of Such Activities as Reception of Survey, Communications, Interview, etc.
Applicable Inapplicable
The main
contents of the Index of the
Reception Reception Reception
Reception time Reception place discussion and basic facts of
mode object type object
the information the survey
provided
Shenzhen Stock Shenzhen Stock
Production and
Exchange Individual Exchange
May 21, 2023 other Individual operation of the
interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
Exchange Individual Exchange
May 21, 2023 other Individual operation of the
interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
September 8th, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
November 10, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
November 13, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
November 13, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
November 14, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
November 15, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Shenzhen Stock Shenzhen Stock
Production and
December 11, Exchange Individual Exchange
other Individual operation of the
2023 interactive investor interactive
company
platform platform
Production and
January 3rd, Telephone Individual
office Individual operation of the none
2023 communication investor
company
Production and
February 06, Telephone Individual
office Individual operation of the none
2023 communication investor
company
February 8th, Telephone Individual Production and
office Individual none
2023 communication investor operation of the
21
Wafangdian Bearing Co., Ltd. 2023 annual report full text
company
Production and
February 15th, Telephone Individual
office Individual operation of the none
2023 communication investor
company
Production and
Telephone Individual
May 22, 2023 office Individual operation of the none
communication investor
company
Production and
Telephone Individual
July 28, 2023 office Individual operation of the none
communication investor
company
Production and
September Telephone Individual
office Individual operation of the none
14th, 2023 communication investor
company
Production and
November 27, Telephone Individual
office Individual operation of the none
2023 communication investor
company
XIII. the implementation of the "Quality return double improvement" action plan
Whether the company disclosed the "quality return double improvement" action plan.
□ Yes No
22
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter IV Corporate Governance
I. Basic situation of corporate governance
Company in accordance with the "company law", "securities law" and other related regulations established by the
general meeting of shareholders, board of directors, board of supervisors, and senior management personnel of the
company governance structure, formed the authority and decision-making body, watchdog and senior
management responsibilities clear, standardized operation mechanism of mutual coordination and mutual checks
and balances. It has established internal systems related to the operation of the "three associations", independent
directors, information disclosure, investor protection, related party transactions, and internal control. Through the
formulation of the Articles of Association and the implementation of various internal systems, the company has
clarified the responsibilities, powers, procedures and obligations of institutions at all levels in decision-making,
implementation and supervision.
Whether the actual situation of corporate governance is materially different from laws, administrative regulations
and regulations on listed company governance issued by CSRC
yes no
The actual situation of corporate governance is not significantly different from laws, administrative regulations
and regulations on listed company governance issued by the CSRC.
II. The company's independence from the controlling shareholders and actual controllers in ensuring the
company's assets, personnel, finance, institutions and business
In terms of business, personnel, assets, institutions and finance, the Company and the controlling shareholder are
independently accounting, undertaking responsibilities and risks independently. There is no situation in which the
company and the controlling shareholder cannot guarantee their independence and independent operation ability
in terms of business, personnel, assets, institutions and finance.
III. The situation of industry competition
Applicable Inapplicable
IV. Information about the annual and extraordinary general meetings of shareholders held during the
reporting period
1. General meeting of shareholders during the reporting period
Investor
The meeting The meeting Date of The meeting
participation At the date
time type disclosure resolution
ratio
Resolution of
2022 Annual
Annual general the 2022
General 80.35% May 31, 2023 June 01, 2023
meeting Annual General
meeting
Meeting
2. The reinstated preferred shareholders request an extraordinary general meeting of shareholders
Applicable Inapplicable
V.The situation of directors, supervisors and senior managers
1. Basic information
23
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Initial
Number of Number of
number Other
Expiry shares shares to be Ending
positio Status of of change Reason of
Name Age Starting Date Date of increased in sold at current shares
n Gender employm shares s change
of Tenure Tenure current period period (shares)
ent (shares (share)
(shares) (shares)
)
Incumben
Liu Jun male 54 president September 06, 2019
t
Incumben
Zhang Xinghai male 55 director September 16, 2015
t
Incumben
Chen Jiajun male 56 director June 26, 2013
t
Director, General Incumben
Wang Jiyuan male 57 May 19, 2021
manager t
Deputy general Incumben
Tan Jianguang male 59 September 06, 2019
manager t
Director, secretary Incumben
Sun Najuan female 55 June 26, 2013
of the board t
Incumben
Zhao Qingtao male 46 director May 19, 2022
t
Incumben
Fang Bo female 51 director June 26, 2013 1,500 0 0 1,500
t
Independent Incumben
Liu Yuping male 67 May 31, 2023
director t
Independent Incumben
Wen Bo male 60 May 19, 2022
director t
Independent Incumben
Sun Kun female 65 May 18, 2018
director t
Independent Incumben
Wang Yan female 60 May 19, 2021
director t
Chairman of the Incumben
Sun Shicheng male 59 September 16, 2015
supervisory Board t
Incumben
Wang Fuxing male 51 supervisor May 18, 2016
t
Zhang Incumben
female 46 supervisor May 31, 2023
Yinghua t
Incumben
Zhang Yihui male 51 supervisor January 8th, 2021
t
Luning male 38 supervisor Incumben September 28, 2022
24
Wafangdian Bearing Co., Ltd. 2023 annual report full text
t
Deputy general Incumben
Li Huawei male 49 December 18, 2019
manager t
Deputy general Incumben
Hu Kaiwei male 42 November 29, 2023
manager t
Independent Leave May 31,
Liang Shuang female 59 May 18, 2017
director office 2023
Leave April 10th,
Wang Lin female 42 supervisor May 19, 2022
office 2023
total -- -- -- -- -- -- 1,500 0 0 1,500 --
During the reporting period, whether any directors or supervisors leave office or senior managers are dismissed
yes no
Due to job changes, Ms. Wang Lin resigned as supervisor of the company
Changes of directors, supervisors and senior managers of the company
Applicable Inapplicable
Name post type Date Cause
Independent Leave office at the
Liang Shuang May 31, 2023 Leave office at the end of one's term
director end of one's term
Wang Lin supervisor Leave office April 10th, 2023 Job change
2. Position
The professional background, main work experience and main responsibilities of the current directors, supervisors and senior managers of the company
1. Resumes of non-independent directors
25
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Mr. Liu Jun, born in January 1970, university degree and owns a master’s degree, he jointed the
workforce in August 1992 and join the CPC in December 2000. Mr. Liu worked as the deputy GM of
DHIDCW Group Co., Ltd. , the deputy president of Dalian Huarui Heavy Industry Group Co., Ltd, the
president and Party Secretary of Dalian Rubber & Plastics Machinery Co., Ltd. Currently he is the Party
Secretary and President of Wafangdian Bearing Group Corp., Ltd.
Mr. Zhang Xinghai, born in October 1968, university degree and a senior accountant at researcher level,
he jointed the workforce in July 1991. Mr. Zhang worked as the deputy chief accountant and secretary of
the Board of Wafangdian Bearing Company Limited, the director, chief accountant and secretary of the
Board of Wafangdian Bearing Company Limited. Now he is the deputy secretary of the Party Committee
and GM of Wafangdian Bearing Group Corp., Ltd.
Mr. Chen Jiajun, born in December 1967, university degree and an economist and statistician, he jointed
the workforce in August 1990. Mr. Chen worked as the section chief, assistant director, deputy director,
director of economic operation department of Wafangdian Bearing Group Corp., Ltd., the assistant GM and
head of economic operation department of Wafangdian Bearing Group Corp., Ltd.; now he is the deputy
GM of Wafangdian Bearing Group Corp., Ltd.
Mr. Wang Jiyuan, born in December 1966. he graduated from Liaoning University with a university
degree major in industrial economics. Mr. Wang worked as the vice president of management department,
director of planning & finance department and vice GM of the Company, the assistant GM of ZWZ
Corporation. Now he is the Director and GM of the Company.
Ms. Sun Najuan, born in October 1968, University degree, Master degree, senior accountant at research
level,she joined the workforce in August 1990. she worked as the account of finance department and head
of inspection section of Wafangdian Bearing Group Corp., Ltd., assistant GM of material supply company
under the Wafangdian Bearing Company Limited, the assistant GM of sales head office of Wafangdian
Bearing Company Limited and the deputy chief accountant of Wafangdian Bearing Group Corp., Ltd.; now
she is the chief accountant, director and secretary of the Board of Wafangdian Bearing Company Limited.
Mr. Tan Jianguang, born in December 1964, an assistant engineer, he jointed the workforce in August
1986. he worked as the workshop director in cage branch factory, the sales man, director, vice president,
vice GM and GM of the marketing department of Wafangdian Bearing Company Limited.; the assistant
GM and GM of the railway division and railway bearing sales company under the Wafangdian Bearing
Company Limited.; now he is the Director and Deputy GM of Wafangdian Bearing Company Limited.
Mr. Zhao Qingtao, born in July 1977, master degree. In 1999, he joined Shanghai Hongzheng Law Firm
as a lawyer; in 2005, he joined Shanghai Xieli Management Consulting Co. , Ltd. as a legal consultant; in
2006, he joined eastby Industrial Minerals Co. , Ltd. as a legal officer in China since 2008; In 2010 joined
Bekaert Business Management (Shanghai) Co. , Ltd. , 2013 as North Asia legal director; 2015 joined Valeo
Business Management (Shanghai) Co. , Ltd. as deputy director of Legal Affairs in China; Joined skf (China)
Ltd. as director of legal affairs and compliance in 2019 and has been director of legal, compliance,
environment, health and safety for Skf China and northeast subregion since March 2022.
Ms. Fang Bo, born June 1972, undergraduate. Joined pricewaterhousecoopers as an auditor in 1994. He
26
Wafangdian Bearing Co., Ltd. 2023 annual report full text
joined skf (China) Co. , Ltd. in 1997. He was the finance manager of the subsidiary company of the
Investment Company. He is the finance manager of skf (China) Co. , Ltd. . Since January 2020, he has been
in charge of skf’s Northeast Asia Financial Operation Center.
2.Resumes of independent directors
Mr. Liu Yuping, born in August 1956, is a professor and has been teaching at the School of Law of
Dongbei University of Finance and Economics since graduation. He is currently the director of the
Teaching Department of the School of Law of Dongbei University of Finance and Economics, an arbitrator
of Dalian Arbitration Commission, a lawyer of Liaoning Zhonglin Law Firm, a legal consultant of
Dongbei University of Finance and Economics Development Corporation, and an independent director of
Dalian Thermoelectric Co., LTD. He is the vice president of the Constitution and Administrative Law
Society of Liaoning Province and has rich legal knowledge.
Ms. Sun Kun, born in 1958, Chinese nationality, doctoral degree and professor of accounting. Since 1982,
she worked in the Northeast University of Finance and Economics, she previously worked as the assistant
professor, lecturer, associate professor, professor of the School of Accounting in Northeast University of
Finance and Economics; she served as a member of the 9th People’s Congress of Liaoning Province, the
deputy secretary general of Liaoning Internal Audit Association, Director of Liaoning Provincial Audit
Society, the Liaoning Department of Finance CPA profession administrative penalty hearing committee
moderator and Director and Academic Committee Member of China Internal Audit Association. From May
2002 to March 2008, she served as an independent director of Dalian Dayang Trands Company.
Ms. Wang Yan, born in 1963, currently she is the professor at Northeast University of Fiance and
Economics, laws school and a master’s degree advisor. In 1981, she graduated from China University of
Political Science & Law with a bachelor’s degree in law; in 1988, Ms. Wang graduated from China
University of Political Science & Law with an LLM degree in economic law; and teaching at the law
school of Northeast University of Fiance and Economics since 1988. Ms. Wang Yan served as the
independent director (retirement) of China Dalian International Cooperation (Group) Holdings Ltd.,
independent director (retirement) of CGN Nuclear Technology Development Co., Ltd., independent
director (in office) of LINTON Technologies Group and independent director (in office) of Bingshan
Refrigeration & Heat Transfer Technologies Co., Ltd. Part-time job: Director of China Economic Law
Research Association, President of the Economic Law Research Society of Liaoning Law Society and
academic member of Liaoning Law Society; the executive director of the First Council of Dalian People’s
Mediation Association, member of the Expert Advisory Committee of Dalian Intermediate People’s Court,
the legal counsel of Dalian Consumers Association, Pulandian Municipal Government and Dalian
Municipal Government Office of Legal Governance; the arbitrator, part-time lawyer of Dalian, Anshan,
Benxi Arbitration Commission; She was the Director of Economic Law Teaching Department of Northeast
University of Fiance and Economics law school and vice dean of the Law School.
Mr. Wen Bo, born in 1963, he graduated from China University of Political Science and Law, majoring in
law. He worked at the Dalian Municipal Bureau of Justice and now he is the founding partner of Liaoning
27
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Huicheng Laws Firm and the expert advisor on local legislation to the Standing Committee of Dalian
People’s Congress.
3. Resume of supervisors
Mr. Sun Shicheng, born in December 1964, bachelor’s degree, participated in work in August 1987 and a
senior political engineer. He previously worked as head of the organization department section, Party
Organizer of Wafangdian Bearing Group, Party Branch Secretary of Northwest Sales Company, secretary
and vice GM of North China Sales Company, director of organization department, and part-time secretary
of the Party Committee and chairman of Labor Union of Wafangdian Bearing Co., Ltd.; currently he is the
deputy secretary of the Party Committee and Chairman of labor union of Wafangdian Bearing Group.
Mr. Wang Fuxing, born in June 1972, university degree and s senior accountant, he jointed the workforce
in August 1993. he previously worked as the head of accounting & finance department and director of the
general management department of Wafangdian Bearing Equipment Manufacturing Co., Ltd., the deputy
secretary, chairman of labor union and the finance manager and human resources director of Wafangdian
Bearing Precision Turntable Bearing Co., Ltd, the office director and secretary of Wafangdian Bearing
Group, head of financial management department and secretary of Wafangdian Bearing Group, and head of
strategic sourcing and secretary of Wafangdian Bearing Group. Now he is the head of the Party
Committee’s Publicity Department, head and secretary of the Corporate Culture Department of Wafangdian
Bearing Group.
Mr. Zhang Yihui, born in August 1972, started to work in August 1991, college degree, graduated from
Liaoning University in June 2000, majoring in business management. He used to be the deputy general
manager of the bearing parts branch of the company and the general manager of the Wafangdian branch of
the high-end automobile bearing company of the Waxiang Group. General manager of medium and large
bearing branch of the company.
Mr. Lu Ning, male, born in June 1985, Han nationality, started to work in July 2009, university degree,
assistant engineer, graduated from Liaoning Technical University engineering mechanics major, the current
position is the general manager of a logistics company.
Ms. Zhang Yinghua, born in February 1978, graduated from Hebei University of Science and Technology
in July 2002 with a college degree as an assistant engineer. In July 2002, he joined the work and served as
the director of human resources Department and Organization Department of Party Committee of Waxing
Group Company. He is currently the Minister of Audit Department, Discipline Inspection and Supervision
Department and Legal Affairs Department of Waxing Group Company
4.Resume of senior management
Mr. Li Huawei, born in June 1974. University degree, master degree, senior engineer. He started to work
in August 1996 and successively served as deputy director, executive deputy director, director, and deputy
chief engineer of the Group's Engineering Research Center. He is currently the vice president of the
company.
Mr. Hu Kaiwei, born in May 1981, Han nationality, bachelor degree, graduated from Lanzhou Jiaotong
28
Wafangdian Bearing Co., Ltd. 2023 annual report full text
University in July 2004, majoring in Mechanical Design, Manufacturing and automation, started to work in
July 2004, and joined the Communist Party of China in June 2003. He has worked in Dalian Locomotive
Depot of Shenyang Railway Bureau, General Electric Transportation Systems (China) Co., LTD., SKF
(China) Sales Co., LTD., and Beijing Shenzhou High-speed Rail Investment Management Co., LTD. He is
currently the deputy general manager of the company and the general manager of the rail transit bearing
Division.
Holding positions in shareholder units
Applicable Inapplicable
Whether to receive
Term Term
Name of A position held by a remuneration
Name of officer start end
shareholder unit shareholder allowance in the
Date Date
shareholder unit
Wafangdian
Group company Party
Liu Jun Bearing Group Co. Yes
secretary, chairman
LTD
Deputy Secretary,
Wafangdian General manager and
Zhang Xinghai Bearing Group Co. director of the Party Yes
LTD Committee of the Group
company
Wafangdian
Deputy General manager
Chen Jiajun Bearing Group Co. Yes
of the group company
LTD
Wafangdian
Sun Najuan Bearing Group Co. MANAGEMENT No
LTD
Deputy Secretary of the
Wafangdian Party Committee of the
Sun Shicheng Bearing Group Co. group company, Yes
LTD chairman of the trade
union and director
Minister and Secretary
Wafangdian of Corporate Culture
Wang Fuxing Bearing Group Co. Department (Propaganda Yes
LTD Department of Party
Committee)
Minister of Audit,
Wafangdian
Discipline Inspection
Zhang Yinghua Bearing Group Co. Yes
and Supervision, Legal
LTD
Affairs
Position in other units
Applicable Inapplicable
Whether you
A position held in Term receive
Name of
Name of other units another Term start Date end remuneration
officer
organization Date allowance in
other units
China Bearing Industry December 01,
Liu Jun Vice president No
Association 2020
Dalian Diyejikai Wazhou Chairman and September 1st,
Liu Jun No
Industry Co., LTD director 2019
Dalian Guangyang Chairman and September 1st,
Liu Jun No
wazhou automobile director 2019
29
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Bearing Co., LTD
Zhang Wazhou Group (Europe)
Managing director No
Xinghai Bearing Co., LTD
Chen Dalian Diyejikai Wazhou September 1st,
director No
Jiajun Industry Co., LTD 2019
Dalian Guangyang
Chen
wazhou automobile director June 01, 2014 No
Jiajun
Bearing Co., LTD
Chen Dalian Zhongcheng Asset
director January 1st, 2016 No
Jiajun Management Co. LTD
Wang China Bearing Industry President of a
April 1st, 2021 No
Jiyuan Association council
Shanghai Aaimuyi
Sun Electromechanical
director May 1st, 2019 No
Najuan Equipment chain Co.,
LTD
Wafangdian bearing
Sun
grinding wheel supervisor No
Najuan
manufacturing Co., LTD
The 7th Vehicle
Tan Committee December 01,
Committee of China No
Jianguang member 2018
Railway Society
Director/Director,
Zhao Legal, Compliance,
SKF (China) LTD Yes
Qingtao EH S, China &
Northeast Asia
Zhao SKF (China) Sales Co.
director No
Qingtao LTD
Zhao SKF Distribution
director No
Qingtao (Shanghai) Co., LTD
SKF Green Intelligent
Zhao
Technology (Shanghai) director No
Qingtao
Co., LTD
Zhao Beijing Nankou Skifu
director No
Qingtao Railway Bearing Co. LTD
SKF (Dalian) Bearing and
Zhao
Precision Technology director No
Qingtao
Products Co., LTD
SKF (Jinan) Bearing and
Zhao
Precision Technology director No
Qingtao
Products Co., LTD
SKF (Xinchang) Bearing
Zhao
and Precision Technology director No
Qingtao
Co., LTD
Zhao Changshan peal Bearing
director No
Qingtao Co., LTD
Zhao Ningbo General Bearing
director No
Qingtao Co., LTD
Zhao Ningbo Haiyat Roller Co.,
Vice chairman No
Qingtao LTD
Zhao SKF Sealing System
director No
Qingtao (Wuhu) Co., LTD
SKF (Shanghai)
Zhao
Automotive Technology director No
Qingtao
Co., LTD
Zhao SKF Sealing Technology
director No
Qingtao (Qingdao) Co., LTD
30
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Lincoln Lubrication
Zhao
Equipment (Changshu) director No
Qingtao
Co., LTD
Financial
manager,Finance
Operations
Fang Bo SKF (China) Co., LTD Yes
Manager, SKF
Northeast
Asia,supervisor
LG Hongkong Holding
Fang Bo director No
Ltd
Fang Bo SKF China Ltd. director No
SKF (China) Sales Co.
Fang Bo supervisor No
LTD
SKF Distribution
Fang Bo supervisor No
(Shanghai) Co., LTD
SKF Green Intelligent
Fang Bo Technology (Shanghai) supervisor No
Co., LTD
SKF (Dalian) Bearing and
Fang Bo Precision Technology supervisor No
Products Co., LTD
SKF (Jinan) Bearing and
Fang Bo Precision Technology supervisor No
Products Co., LTD
SKF (Xinchang) Bearing
Fang Bo and Precision Technology supervisor No
Co., LTD
Changshan Peal Bearing
Fang Bo supervisor No
Co., LTD
Ningbo General Bearing
Fang Bo supervisor No
Co., LTD
SKF Sealing System
Fang Bo supervisor No
(Wuhu) Co., LTD
SKF (Shanghai)
Fang Bo Automotive Technology supervisor No
Co., LTD
SKF Marine (Shanghai)
Fang Bo supervisor No
Co., LTD
SKF Sealing Technology
Fang Bo supervisor No
(Qingdao) Co., LTD
Lincoln Lubrication
Fang Bo Equipment (Changshu) supervisor No
Co., LTD
Liang Dongbei University of
Professor Yes
Shuang Finance and Economics
Dongbei University of
Sun Kun Professor Yes
Finance and Economics
Wang Dongbei University of
Professor Yes
Yan Finance and Economics
Wang Dalian Liancheng CNC Independent
Yes
Yan Machine Co., LTD director
Wang Iceberg Cold & Hot Independent
Yes
Yan Technology Co., LTD director
Liu Dongbei University of
Professor Yes
Yuping Finance and Economics
Liu Liaoning Zhonglin Law LAWYER Yes
31
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Yuping Firm
Liu Dalian Thermoelectric Independent
Yes
Yuping Co. LTD director
Liu Dalian Arbitration
arbitrator Yes
Yuping Commission
Dongbei University of
Finance and Economics
Liu
Economic and Legal adviser Yes
Yuping
Technological
Development Corporation
Liaoning Huaicheng Law
Wen Bo Founding partner Yes
Firm
Sun Dalian Zhongcheng Asset
director No
Shicheng Management Co., LTD
Wafangdian bearing
Zhang
Group precision forging supervisor No
Yinghua
Co., LTD
Zhang Wazhou Group (USA)
supervisor No
Yinghua Bearing Co., LTD
Wazhou precision
Li spherical roller bearing
Executive director No
Huawei (Wafangdian) limited
liability company
Punishment of current and outgoing directors, supervisors and senior managers by securities regulatory
authorities in the past three years during the reporting period
Applicable Inapplicable
3. Remuneration of directors, supervisors and senior managers
Decision-making procedures, basis for determination and actual payment of remuneration for directors,
supervisors and senior managers
The remuneration of independent directors of the company shall be calculated and paid according to the
standards determined by the board of directors and the general meeting of shareholders. Other directors
and supervisors shall not pay remuneration for their positions as directors and supervisors. The salary of
senior executives shall be determined according to the salary level of the heads of dalian state-owned
enterprises and the completion of the business objectives determined by the board of directors at the
beginning of the year, strictly following the company's salary assessment system.
Remuneration of directors, supervisors and senior managers during the reporting period
Unit:10000yuan
Whether to
Total pre-tax obtain
compensation remuneration
The name Gender Age Position As state
received from from related
the company parties of the
company
Liu jun male 54 President The current 0 yes
Director and General
Wang Jiyuan male 57 The current 82.03 no
Manager
Director, Chief
Sun Najuan female 55 accountant,Secretary The current 83.78 no
of the board
Zhang Xinghai male 55 Director The current 0 yes
Chen Jiajun male 56 Director The current 0 yes
Tan Jianguang male 59 Director The current 112.34 no
Sun Shicheng male 59 Chairman of the The current 0 yes
32
Wafangdian Bearing Co., Ltd. 2023 annual report full text
supervisory Board
Wang Fuxing male 51 supervisor The current 0 yes
Zhang Yihui male 51 supervisor The current 16.8 no
Zhang Yinghua female 46 supervisor The current 0 yes
Luning male 38 supervisor The current 31.7 no
Deputy general
Li Huawei male 49 The current 55.64 no
manager
Deputy general
Hu Kaiwei male 42 The current 18.1 no
manager
Zhao Qingtao male 46 Director The current 0 yes
Fang Bo female 51 Director The current 0 yes
Sun Kun female 65 Independent director The current 4 no
Wang Yan female 60 Independent director The current 4 no
Wen Bo male 60 Independent director The current 4 no
Liu Yuping male 67 Independent director The current 0 no
Leave one's
Liang Shuang female 59 Independent director 4 no
post
Total -- -- -- -- 416.39 --
Other information note
Applicable Not applicable
VI. Performance of directors' duties during the reporting period
1. The situation of the Board of Directors during this reporting period
The meeting time At the date Date of disclosure The meeting resolution
Resolution of the fourth meeting of the
Fourth meeting of the ninth Board of Directors 2023/04/26 2023/04/28
ninth Board of Directors
Resolution of the fifth meeting of the
Fifth meeting of the ninth Board of Directors 2023/07/12 2023/07/14
ninth Board of Directors
Resolution of the sixth meeting of the
Sixth meeting of the ninth Board of Directors 2023/08/18 2023/08/22
ninth Board of Directors
Seventh meeting of the ninth Board of Resolution of the seventh meeting of the
2023/10/20 2023/10/24
Directors ninth Board of Directors
Resolution of the eighth meeting of the
Eighth meeting of the ninth Board of Directors 2023/11/29 2023/12/01
ninth Board of Directors
2. The attendance of directors at the board of Directors and shareholders' meetings
Attendance of directors at the board of directors and general meetings of shareholders
The number Whether two
Number of
of board Number of Number of consecutive
board Attendance
meetings to board times Board of board
Director's meetings of
be attended meetings entrusted to Directors meetings
name attended by shareholders'
during the attended on attend board absence were not
communicati meetings
reporting site meetings attended in
on
period person
Liu jun 5 3 2 0 0 No 1
Sun Najuan 5 3 2 0 0 No 1
Wang Jiyuan 5 3 2 0 0 No 1
Zhang Xinghai 5 3 2 0 0 No 1
Chen Jiajun 5 3 2 0 0 No 1
Tan Jianguang 5 3 2 0 0 No 1
ZhaoQingTang 5 3 2 0 0 No 1
Fang Bo 5 3 2 0 0 No 1
Sun Kun 5 1 4 0 0 No 1
Wang Yan 5 1 4 0 0 No 1
33
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Liu Yuping 4 1 3 0 0 No 1
Wen bo 5 1 4 0 0 No 1
Liang Shuang 1 0 1 0 0 No 1
Two consecutive statements of failure to attend board meetings in person
None
3. Objections raised by directors to matters related to the company
Whether directors raise objections to matters related to the company
yes no
During the reporting period, the directors raised no objection to the company's related matters.
4. Other explanations of directors' performance of duties
Whether the directors' suggestions about the company have been adopted
yes no
A director's statement to the Company that a proposal has been or has not been adopted
During the reporting period, the directors of the Company carried out their work in strict accordance with
the Company Law, the Securities Law, the Governance Code for Listed Companies, the Self-Regulatory
Guidelines for Shenzhen Stock Exchange Listed Companies No. 1 -- Standardized Operation of Listed
Companies on the Main Board, the Articles of Association of the Company and the Rules of Procedure of
the Board of Directors, with diligence and diligence. I put forward relevant opinions on the major
governance and operation decisions of the company, reached a consensus through full communication and
discussion, and resolutely supervised and promoted the implementation of the resolutions of the board of
directors to ensure that the decisions were scientific, timely and efficient, and to safeguard the legitimate
rights and interests of the company and all shareholders.
VII. The situation of the special committees under the Board of Directors during the reporting
period
Important Other
Name Numbe Details
comments perfor
of Members of r of of
At the date The meeting content and mance
commit the situation Meetin objection
suggestion of
tee gs (if any)
s duties
To nominate Mr. Liu Yuping as a non-
Nomina Wang Yan， 2023.4.25 independent director candidate for the
ting Liu Jun， ninth Board of Directors
2
commit Wen Bo Recommend Mr. Hu Kaiwei as Deputy
tee 2023.11.29 General manager of Wafangdian
Bearing Co., LTD
Communicate with Lixin's accountant
2023.02.28
in the audit of the 2022 annual audit.
(1) Report on internal control and
financial audit work in 2022
Sun Kun， (2) The proposal on the forecast of
Liang related party transactions in 2023
Audit
Shuang， (3) Annual Financial Report for 2022
commit 5
tee Zhuang Xing (audited)
Hai 2023.04.17
(4) Final Financial Report for the first
quarter of 2023 (unaudited)
(5) Motion on the renewal of the
appointment of accounting firms for
the year 2023
(6) The Audit Committee's concluding
34
Wafangdian Bearing Co., Ltd. 2023 annual report full text
report on the audit work of accounting
firms in 2022
(7) Report on the performance of the
Audit Committee in 2022
(8) Summary of internal control and
internal audit work in 2022 and
arrangement in 2023
1.2023 semi-annual daily affiliated
transaction execution report
2.2023 Semi-annual Financial Report
(Unaudited)
2023.8.15
3. Summary of internal control and
internal audit work in the first half of
2023 and plan for the second half of
the year
(1) Financial Report for the third
Quarter of 2023 (unaudited)
2023.10.19 (2) Summary of internal control and
internal audit work in the third quarter
of 2023 and the fourth quarter plan
Pre-audit communication with Lixin's
2023.11.24
accountant on 2023 annual audit work
VIII. Work of the Board of Supervisors
The board of Supervisors shall find out whether the company has risks in its supervision activities during
the reporting period
yes no
The board of Supervisors has no objection to the matters supervised during the reporting period.
IX. Employee status
1. Number of employees, professional composition and education level
Number of working employees of parent company at
1,985
the end of reporting period (persons)
Number of employees in major subsidiaries at the end
543
of reporting period (persons)
Total number of in-service employees at the end of
2,528
reporting Period (persons)
Total number of salaried employees (persons) 2,809
Number of retired employees (persons) to be borne by
2,923
the parent company and its major subsidiaries
Professional composition
Specialty composition category Number of Majors (Persons)
Production personnel 1,705
The sales staff 185
Technical personnel 197
Financial personnel 55
Administrative personnel 386
A combined 2,528
The degree of education
Education Category Quantity (person)
Postgraduate and above 42
University degree 566
college 541
35
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Secondary school/high school and below 1,379
A combined 2,528
2. Salary policy
According to the relevant laws and regulations of the state and a series of relevant policies of the labor
department of the government, and combined with the actual situation of the company, the company
adheres to the principle of "pay according to the post, pay according to the performance, efficiency priority
and fairness", implements the "adaptive" organizational performance management system, and the
performance distribution is tilted to the strivers and value creators, giving full play to the incentive role of
salary. Stimulate the enthusiasm of employees.
3. Training plan
In 2024, the joint-stock company plans to carry out 127 training projects of various kinds, including 39
company-level trainings, 33 system-level trainings and 55 company-independent trainings. The training
cost is 1.9478 million yuan, more than 11,424 people are trained and 3,049 hours are trained. The training
coverage rate is 100%.
4. Labor outsourcing
Applicable Inapplicable
X.The company's profit distribution and the conversion of capital reserve fund into capital stock
Formulation, implementation or adjustment of profit distribution policies, especially cash dividend policies
during the reporting period
Applicable Not applicable
Corporate profit distribution policy
1. When formulating the profit distribution plan, the Company shall pay full attention to the reasonable
return of investors, while taking into account the long-term interests of the company, the overall interests
of all shareholders and the sustainable development of the company.
2. Adhere to the continuity and stability of the company's profit distribution. On the premise that the
company's profits and cash can meet the company's sustainable operation and long-term development, the
company's cumulative profit distributed in cash in the recent three years shall not be less than 30 percent of
the average annual distributable profit realized in the recent three years.
Special explanation of cash dividend policy
Whether it conforms to the provisions of the articles of association or the
YES
requirements of the resolution of the general meeting of shareholders:
Are dividend standards and ratios clear and clear: YES
The adequacy of relevant decision-making procedures and mechanisms: YES
Whether the independent directors have performed their duties and played
YES
their due roles:
If the company does not pay a cash dividend, it shall disclose the specific
YES
reasons and the next steps to enhance the return level of investors:
Whether minority shareholders have sufficient opportunities to express their
opinions and appeals, and whether their legitimate rights and interests are YES
fully protected:
If the cash dividend policy is adjusted or changed, the conditions and
YES
procedures are compliant and transparent:
The company's profit during the reporting period and the parent company's profit available for distribution
to shareholders are positive, but no cash dividend distribution plan has been put forward
Applicable Inapplicable
Profit distribution and conversion of capital reserve fund into capital stock during the reporting period
36
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Applicable Inapplicable
The company plans not to distribute cash dividend, bonus shares or increase capital stock by provident
fund.
XI. The implementation of the company's equity incentive plan, employee stock ownership plan or
other employee incentive measures
Applicable Inapplicable
The company has no equity incentive plan, employee stock ownership plan or other employee incentive
measures and their implementation during the reporting period.
XII. Internal control system construction and implementation during the reporting period
1. Internal control construction and implementation
In 2023, according to the requirements of the Articles of Association and other systems as well as the
needs of actual business adjustment, the company has formulated 4 new internal control systems and
revised 6 internal control systems, further clarifying the responsibilities, rights and business processes of
each organization, avoiding cross-functional, missing or overly concentrated powers and responsibilities,
and forming a working mechanism in which each has its own duties, responsibilities, mutual constraints
and coordination. The company has updated the system compilation, issued and promulgated the new
Internal Control System Compilation, which provides guidance and basis for the establishment, operation,
supervision, evaluation and maintenance of the internal control system, and ensures the unity of the
internal control system of the joint-stock company in terms of consciousness and behavior.
2. Details of major internal control defects found during the reporting period
□Yes No
XIII. Management and control of subsidiaries during the reporting period
Problems Solution
The name of Consolidatio Integration of To solve the Follow-up
encountered measures
the company n plan the progress progress Solution Plan
in integration taken
None None None None None None None
XIV.Internal control evaluation report or internal control audit report
1. Internal control report
Disclosure date of full internal control evaluation report 2024.04.30.
Index of full-text disclosure of internal control evaluation reports http//www.cninfo.com.cn
The proportion of total assets of units included in the evaluation
scope to total assets of the company in consolidated financial 100.00%
statements
The proportion of the operating income of units included in the
evaluation scope to the operating income of the company's 100.00%
consolidated financial statements
Defect identification standard
category Financial report Non-financial report
The following situations shall be The following situations are
identified as major defects of internal identified as non-major defects of
control of financial reporting, and internal control of financial
other situations shall be identified as reporting, and other situations are
The qualitative standard major defects or general defects identified as major defects or
according to the degree of impact. general defects according to the
(1) Senior management fraud, degree of impact.
including financial reporting fraud; (1) The enterprise lacks
Improper use of assets; False democratic decision-making
revenues, expenses and liabilities; procedure;
37
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Improper acquisition of assets; Tax (2) unscientific decision-making
evasion and high-level fraud; procedures;
(2) Restatement of the issued financial (3) Violation of national laws and
report for material misstatement to regulations, such as
reflect the correction of the wrong environmental pollution;
statement, and was punished by the (4) Frequent occurrence of
regulatory authorities for this matter; negative media news;
(3) Certified public accountants find (5) The results of internal control
that there is a material misstatement in evaluation, especially major or
the financial report of the current important defects, have not been
period, while internal control fails to corrected;
find the misstatement in the operation (6) Lack of institutional control
process; or systematic failure of important
(4) The audit committee of the business.
Company's internal control
supervision of the company's financial
reports is invalid, including the audit
committee is unable to effectively
supervise the internal control of the
company's financial reports or is not
qualified and capable of monitoring
the accuracy of financial reports;
(5) The defect that the total amount of
related transactions exceeds the
amount of related transactions
approved by the general meeting of
shareholders due to the failure of
internal decision-making procedures
in accordance with relevant
provisions.
Major defects: direct property
Major defect: direct property loss of losses of more than 500,000
more than 10 million yuan; yuan;
Major defects: direct property loss of Major defect: direct property loss
Quantitative standard 5 million yuan (inclusive)-10 million less than or equal to 500,000
yuan; yuan;
General defects: less than 5 million Defects other than major defects
yuan. and major defects shall be
identified as general defects.
Number of material defects in 0
financial reports (pieces)
Number of non-financial report 0
material defects (PCS)
Number of significant defects in 0
financial reports (pieces)
Number of non-financial report 0
significant defects (PCS)
2. Internal control audit report
Applicable Inapplicable
Review section of internal control audit report
In our opinion, Waxshaft Corporation maintained effective internal control over financial reporting in all
material respects as of December 31, 2023 in accordance with the Basic Practice for Internal Control of
Enterprises and relevant provisions.
Disclosure of internal control audit report Disclosure of the
Disclosure date of full internal control audit report April 30, 2024
Index of full-text disclosure of internal control audit reports http//www.cninfo.com.cn
Standard without
Opinion type of internal control audit report
reservation
Whether there are material deficiencies in the non-financial reports no
Whether the accounting firm issues the internal control audit report of non-standard opinion
yes no
Whether the internal control audit report issued by accounting firm is consistent with the self-evaluation
report of the board of directors
38
Wafangdian Bearing Co., Ltd. 2023 annual report full text
yes no
XV. Self-inspection and rectification of problems in the special action of governance of listed
companies
In response to the problems identified by the company, the company has implemented and rectified them
one by one.
39
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter V Environmental and social responsibility
I. Major environmental issues
Whether the listed company and its subsidiaries belong to the key pollutant discharging units announced
by the environmental protection authorities
yes no
Environmental protection related policies and industry standards
The comprehensive emission standard of air pollutants is GB16297-1996, and the unorganized emission
control standard of volatile organic compounds is GB37822-2019
Environmental protection administrative licensing situation
The existing discharge permit is valid for 5 years, from June 16, 2023 to June 15, 2028.
Industry emission standards and the specific situation of pollutant emissions involved in production and
business activities
Types of Name of Impleme
main major ntation
Emissio Excessiv
pollutant pollutant Discharg of Approve
Numbe n e
s and s and Discharge e outlet pollutant Total d total
Name r of concentr emission
character character mode distributi discharg emission emission
outfalls ation/int conditio
istic istic on e s
ensity n
pollutant pollutant standard
s s s
Without
Assembl
Exhaust 16.8mg/ 587.52K exceedin
NMHC organized 1 y work 1920KG
gas m3 G g
area
standard
Without
Assembl
Exhaust 22.6mg/ 487.68K exceedin
NMHC organized 1 y work 1920KG
gas m3 G g
area
standard
Compre
Dalian Without
Assembl hensive
wazhou Exhaust 8.76mg/ exceedin
NMHC organized 1 y work emission 288KG 1920KG
precision gas m3 g
area standard
motor standard
for air
car Without
Assembl pollutant
bearing Exhaust 14.1mg/ 660.48K exceedin
NMHC organized 1 y work s 1920KG
co., LTD gas m3 G g
area GB1629
standard
7-1996
Without
Hydroge
Exhaust Pickling 2.0mg/m 1.266K exceedin
n organized 1 78KG
gas chamber 3 G g
chloride
standard
Without
hydroxid Exhaust Pickling ＜ exceedin
organized 1 1.9 231KG
e gas chamber 3mg/m3 g
standard
Treatment of pollutants
After centralized collection of the collection system, four sets of oil mist purification devices are used for
processing by centrifugal and filtration separation technology.
The lathe is equipped with a mist absorber, and the filter element is replaced every six months, and the
workshop ventilation is strengthened.
40
Wafangdian Bearing Co., Ltd. 2023 annual report full text
The pickling operation is equipped with acid mist neutralization processor and enhanced indoor ventilation.
Environmental self-monitoring programme
The subsidiary has developed an environmental self-monitoring program, and the self-monitoring program
and monitoring data are uploaded to the "self-monitoring information release platform of key pollutant
discharge units in Liaoning Province, which is monitored in real time by the local environmental protection
department."
Emergency plan for environmental emergencies
The emergency plan for environmental emergencies shall be filed in the Ecological Environment Bureau of
Jinpu New District (Jinzhou) of Dalian City.
File No. 210213S2020003-L
Investment in environmental governance and protection and payment of environmental protection tax
No sewage charges are required for quarterly declarations
Measures taken to reduce its carbon emissions during the reporting period and their effects
Applicable Not applicable
The company is an enterprise with sustainable development as its core values, and has a worldwide
influence in the field of bearing manufacturing. Our company is committed to promoting the reduction of
carbon emissions and striving to adopt sustainable production methods to contribute to environmental
protection. By collecting detailed data and actionable recommendations on the company's carbon footprint
in 2023, combined with a comprehensive assessment of the level of carbon emissions, the aim is to identify
and drive potential opportunities to reduce the carbon footprint in order to achieve sustainable development
goals.
1.Energy consumption and carbon emissions
The company's annual energy consumption of 9090.90 tons of standard coal, equivalent to carbon
emissions of 22,300 tons of carbon emissions, an increase of 0.1%, while the energy consumption of
10,000 yuan of output value is 26.08 kg of standard coal, a year-on-year decrease of 37.29%, 10,000 yuan
of output value energy consumption decreased significantly, and energy conservation has achieved
excellent results.
2.Basic energy management work
Optimize the energy management system. The company has completed the external audit and certification
of energy management system, and has obtained the international and domestic certificates of energy
management system issued by Rheinland Company, and has obtained the international mutual recognition
qualification of IAF.
Cooperated with energy supply units to conduct energy training. Participated in green power training in
China Resources Jinzhou Power Plant, further deepened the cooperation between the joint stock company
and energy supply units, and laid the foundation for future green power acquisition
Conduct knowledge training on "cloud empowerment". Use the company's knowledge sharing platform to
release the fourth phase of energy management "Cloud empowerment".
3.Energy saving and carbon reduction technical reform measures project
To the national "carbon peak, carbon neutrality" as the goal, combined with new technology, new materials,
41
Wafangdian Bearing Co., Ltd. 2023 annual report full text
new processes, new equipment of the "four new" energy-saving means, innovative ideas, the development
of energy-saving project plans.
During the year, 18 new energy-saving and carbon reduction project measures were developed, and the
implementation of each project was tracked and implemented every quarter. By the end of the year, all 18
energy-saving measures were completed and implemented, and 205.88 tons of carbon emissions were
reduced throughout the year. Among them, energy-saving lighting mining lamps cover more than 85%,
and further increase the proportion of green lighting; Continue to implement the quota control of a single
high energy consumption equipment to improve the energy efficiency of thermal processing equipment;
The green area was expanded, more than 980 trees were planted, and carbon emissions were absorbed by
green plants, achieving a reduction of 17.93 tons.
4.We will optimize the energy mix and increase the utilization rate of clean energy
In 2023, using the opportunity of power reform, we obtained 10% of the total annual electricity
consumption of wind power and 20% of nuclear power in the power market, and achieved a clean energy
utilization rate of 30%, an increase of 25% over the same period last year, refreshing the record of clean
energy utilization. At the same time, the company obtained 3 million KWH of green electricity (with green
certificate), and the company obtained the green certificate for the first time, providing strong support for
green manufacturing.
5.Work measures for 2024
First of all, the team construction was strengthened to expand the scope of carbon footprint
verification of Waxing Co., LTD
Absorb college graduates from environmental protection and energy related majors, hire experts in carbon
emission and carbon trading, strengthen the energy management team, and improve the scale and
professionalism of the team. In order to cope with the future requirements of the country in terms of carbon
emission and carbon footprint for enterprises.
At the same time, we are doing a good job in the statistics of carbon footprint scope 2, continue to deepen
the statistics of scope 1, and will extend to scope 3 in the future.
Secondly, the company will optimize the efficiency of energy use through technological innovation
and process improvement.
The company will seek to reduce greenhouse gas emissions in the production process and achieve
reductions in energy consumption through the use of cleaner energy sources and improvements in
traditional processes.
By strengthening the annual "four new" energy-saving technical transformation project measures, the
supporting role of green and low-carbon technology continues to strengthen. In 2024, the joint-stock
company will introduce state-level energy-saving projects into the annual energy-saving technical
transformation measures, and use the favorable national policies to drive the in-depth implementation of
the joint-stock company's energy-saving transformation projects.
Among them, the green lighting work will be completed by 2024 to achieve full coverage of green lighting;
Continue to deepen the management of a single high energy consumption quota to achieve efficient
operation of thermal processing equipment; Promote single-unit lighting, single-unit circulating cooling,
single-unit compressed air, etc., to achieve energy-saving single-unit production.
Thirdly, the company will "break first and then stand" to improve the "green content" of energy
development.
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
To promote carbon peak carbon neutrality, the energy sector is the main battlefield. The joint Stock
Company will promote the development of new and clean energy in a more prominent position, and will
actively promote the development and utilization of renewable energy in the future. In the form of
investment or cooperation, the joint-stock company will develop renewable energy projects, such as solar
power and wind power, to reduce dependence on traditional fossil fuels and reduce carbon emissions.
Beginning in 2024, the joint stock Company will continue to carry out rooftop distributed photovoltaic
power generation projects in the North, South and old factory areas, the project is expected to be about 40
megawatts, is expected to achieve annual photovoltaic power generation of 50 million KWH or more,
clean energy consumption continues to improve, and non-fossil energy to achieve leap-forward
development.
In addition, the company will strengthen the monitoring and management of energy management
and carbon emission data.
The company will establish an efficient energy management system to further reduce carbon emissions by
regularly monitoring and evaluating energy consumption, timely adjusting and improving energy
efficiency.
The company will be guided by the national new infrastructure construction development strategy and
national energy security strategy, driven by the realization of the development goal of "carbon peak and
carbon neutrality", and establish a set of intelligent energy management information system integrating
"new management, new model and new guarantee" which is suitable for the production and operation of
joint stock companies. Comprehensively improve the intelligent, refined and intensive management level
of the company's energy use, and comply with the company's business philosophy of high-quality
development.
Administrative punishment for environmental problems during the reporting period
The impact on
Name of the production Corrective
company or Penalty reason non-compliance The penalty and operation of measures of the
subsidiary listed company
companies
None None None None None None
Other environmental information that should be disclosed
no
Other environmental related information
no
II. Social responsibility
In 2023, the company will earnestly fulfill its due social responsibilities. While pursuing corporate
economic benefits, it will actively undertake the responsibilities for the comprehensive development of the
country and society, the natural environment and resources, as well as stakeholders such as shareholders,
employees, customers, consumers, suppliers and communities, and realize the social value of the company.
It has better realized the win-win cooperation between the state, society and stakeholders, strengthened
environmental protection, improved resource efficiency, influenced and driven the development of local
economy through project construction and other ways, and effectively promoted the coordinated
development of the company with society, nature and other stakeholders.
In strict accordance with the relevant national and local laws and regulations and document requirements,
the company has handled pension insurance, unemployment insurance, medical insurance, work-related
injury insurance, maternity insurance, housing provident fund and large medical mutual insurance for
43
Wafangdian Bearing Co., Ltd. 2023 annual report full text
employees. Provide timely assistance to employees in need. The employment system, including the salary
system and incentive mechanism, has been established and improved to ensure that employees enjoy labor
rights and fulfill labor obligations according to law. The state has established and improved the system of
occupational safety and health, strictly implements the state regulations and standards on occupational
safety and health, conducts education on occupational safety and health, provides occupational protection
and health examination to employees, and provides them with a healthy and safe working and living
environment, so as to prevent accidents at work and reduce occupational disease hazards to the greatest
extent.
The company adheres to the principle of voluntariness, fairness, compensation of equivalent value, honesty
and credit in its business activities, strictly controls the quality target, and ensures the provision of
qualified products. The technical department of the company actively carries out the development of new
products and new materials, and ensures that the various products or services provided by the company
meet the relevant national quality standards or have been certified by the relevant national quality
inspection departments, and actively applies for various third-party certifications at home and abroad. The
company pays attention to customer after-sales service, and properly handles complaints and suggestions
made by customers and consumers. Strictly conduct third-party qualification review and site inspection on
suppliers, select qualified suppliers, carefully understand the needs of suppliers, and actively build a good
cooperation atmosphere.
III. Consolidating and expanding poverty alleviation efforts and rural revitalization
Send village cadres to the surrounding areas of Dalian City, support rural construction, assume social
responsibilities, and constantly build strong village party organizations and strengthen party building work.
Promote the work of strengthening villages and enriching people, implement projects benefiting
agriculture, and increase the collective income of villages. We will improve the appearance and appearance
of villages, raise the level of governance, do a good job in publicity and supervision, organize timely
cleanup of garbage sites, improve the living environment, and build beautiful villages. Carry out the
sunshine three affairs open, follow up to solve the problems left over by letters and visits, implement the
basic farmland rehabilitation work, holiday and village two committee team members, carry out the "three
prevention" work, care for the elderly, contact with hospitals and love organizations, health check-up for
the elderly and so on.
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter VI Important items
I. Performance of commitments
1. Commitments made by the company's actual controller, shareholders, related parties, acquirer and
related parties committed by the Company have been fulfilled during the reporting period or have not been
fulfilled by the end of the reporting period
Applicable Inapplicable
During the reporting period, the company does not have commitments that have been fulfilled by the actual
controller, shareholders, related parties, acquirers, the company and other committed parties within the
reporting period or have not been fulfilled by the end of the reporting period.
2. If there is a profit forecast for the assets or projects of the company and the reporting period is still in the
profit forecast period, the company shall explain why the assets or projects meet the original profit forecast
Applicable Inapplicable
II.Non-operational appropriation of funds by controlling shareholders and other related parties to
the listed company
Applicable Inapplicable
During the reporting period, there is no non-operational appropriation of funds by controlling shareholders
and other related parties to the listed company.
III. Violation of external guarantee
Applicable Inapplicable
The company has no violation of external guarantee during the reporting period.
IV. Explanation of the Board of Directors on the latest "Non-standard audit Report"
Applicable Inapplicable
V.Explanation of the Board of Directors, supervisory Board and independent directors (if any) to the
"non-standard audit report" of the accounting firm during the reporting period
Applicable Inapplicable
Ⅵ.Description of changes in accounting policies, accounting estimates or correction of significant
accounting errors compared with the previous year's financial report
Applicable Inapplicable
There is no change in accounting policies, accounting estimates or correction of major accounting errors
during the reporting period.
VII. Explanation of changes in the scope of consolidated statements as compared with the financial
statements of the previous year
Applicable Inapplicable
There is no change in the scope of consolidated statements during the reporting period.
VIII.Employment and dismissal of accounting firms
Now employed accounting firm
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
LiXin Certified Public Accountants
Name of domestic accounting firm
(Special General Partnership)
Remuneration of domestic accounting firm (ten thousand yuan) 70
The number of consecutive years of audit services provided by
2
domestic accounting firms
Name of certified public accountant of domestic accounting firm Cui Song Guo Yao Wu
The number of consecutive years of audit services provided by
1
certified public accountants of domestic accounting firms
Whether to hire an accounting firm for the current period
yes no
Internal control of audit and accounting firms, financial consultants or sponsors
Applicable Inapplicable
IX. Delisting after the disclosure of the annual report
Applicable Inapplicable
X. Matters related to bankruptcy reorganization
Applicable Inapplicable
No bankruptcy reorganization related matters occurred during the reporting period.
Ⅺ.Major litigation and arbitration matters
Applicable Inapplicable
Amount Progress Litigation
Whether an Execution
involved of (arbitration)
Litigation (arbitration) estimated of litigation Date of Disclosure
(Ten litigation adjudication
basic information liability is (arbitration) disclosure index
thousand (arbitratio result and
formed judgments
yuan) n) influence
Summary of other
litigation that occurred
during the reporting period At the end of
Completion
and was settled as of the Closed the reporting
51.7 none of
end of this reporting period case period
performance
and did not meet the Closed case
material litigation
disclosure standard
Summary of other
litigation that occurred
At the end of
during the reporting period
the reporting
that was not settled as of Closed
198.51 none period Up to report
the end of this reporting case
Outstanding
period and did not meet the
case
material litigation
disclosure standard
Ⅻ.Punishment and rectification
Applicable Inapplicable
There is no punishment or rectification during the reporting period.
XIII. Integrity status of the Company and its controlling shareholders and actual controllers
□ Applicable Not applicable
XIV. Major connected transactions
1. Related transactions related to daily operations
□ Applicable Not applicable
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
During the reporting period, there were no related transactions related to the company's daily operations.
2. Related transactions arising from the acquisition or sale of assets or equity
□ Applicable Not applicable
During the reporting period, there were no related transactions involving the acquisition or sale of assets or
equity.
3. Related transactions for joint foreign investment
□ Applicable Not applicable
No related transactions of joint foreign investment occurred during the reporting period.
4. Related creditor's rights and debts
Applicable □ Not applicable
Whether there are non-operational related creditor and debt transactions
□ Yes No
The company does not have non-operational related debt transactions during the reporting period.
5. Dealings with related financial companies
□ Applicable Not applicable
There is no deposit, loan, credit granting or other financial business between the Company and the finance
company and the related parties.
6. Transactions between the financial company controlled by the company and related parties
□ Applicable Not applicable
There is no deposit, loan, credit or other financial business between the finance company controlled by the
Company and the related parties.
7. Other significant connected transactions
Applicable Not applicable
For the routine related party transactions, please refer to "Wafangdian Bearing Co., LTD. 's Announcement
on the Expected Routine Related Party Transactions in 2024" disclosed by the Company on Juchao
Information Website on April 30, 2024 and Section 10, Section 12, "Related Parties and Related
Transactions" 5 "Related Party Transactions" of this report.
Major related transaction interim report disclosure website related inquiries
XV.Major contracts and their performance
1. Trusteeship, contracting and leasing
(1) Custody
Applicable Inapplicable
There is no custody during the reporting period.
(2) Contracting situation
Applicable Inapplicable
There is no contracting during the reporting period.
(3) Lease situation
Applicable Inapplicable
Lease Information
The Company does not have any major lease contracts.
Projects that bring profit and loss for the company to reach more than 10% of the total profit of the
company during the reporting period
Applicable Inapplicable
47
Wafangdian Bearing Co., Ltd. 2023 annual report full text
During the reporting period, there is no leasing project whose profit and loss of the company reaches more
than 10% of the total profit of the company during the reporting period.
2. Major Guarantee
Applicable Inapplicable
There is no material guarantee during the reporting period.
3. Cash asset management by entrusting others
(1) Entrusted financial management
Applicable Inapplicable
There is no entrusted financial management during the reporting period.
(2) Entrusted loans
Applicable Inapplicable
There is no entrusted loan during the reporting period.
4. Other major contracts
Applicable Inapplicable
There are no other major contracts during the reporting period.
XVI.Explanation of other important matters
Applicable Inapplicable
There is no other major event that needs to be explained during the reporting period.
Xvii. Major events of the company's subsidiaries
Applicable Inapplicable
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Chapter VII Share changes and shareholders
I. Changes in shares
1. Changes in shares
Unit：stocks
Prior to this change This change is more or less (+, -) After this change
Convers
Issuing
Send ion of
number ratio new other total number ratio
shares provide
shares
nt fund
I.Unlisted and tradable 244,000,0 244,000
60.61% 60.61%
shares 00 ,000
244,000,0 244,000
1. Shares of sponsors 60.61% 60.61%
00 ,000
Among them: the state 244,000,0 244,000
60.61% 60.61%
holds shares 00 ,000
Domestic legal persons
hold shares
Overseas legal persons
hold shares
other
2. Raise corporate
shares
3. Internal work unit
4. Preferred stock or
otherwise
II.Shares already listed 158,600,0 158,600
39.39% 39.39%
and circulating 00 ,000
1. Renminbi common
stock
2. Domestically listed 158,600,0 158,600
39.39% 39.39%
foreign capital stocks 00 ,000
3. Foreign capital stocks
listed abroad
4, other
III.Total number of 402,600,0 100.00 402,600 100.00
shares 00 % ,000 %
Reasons for changes in shares
Applicable Inapplicable
Approval of changes in shares
Applicable Inapplicable
Transfer of shares
Applicable Inapplicable
The impact of share changes on basic and diluted earnings per share, net asset per share attributable to
common shareholders of the company and other financial indicators in the latest year and the latest period
Applicable Inapplicable
Other contents that the company deems necessary or required by the securities regulatory authority
Applicable Inapplicable
2. Changes in the shares limited for sale
Applicable Inapplicable
II. Securities issuance and listing
1. Securities issuance (excluding preferred stock) during the reporting period
49
Wafangdian Bearing Co., Ltd. 2023 annual report full text
□ Applicable Inapplicable
2. Description of the changes in the total number of shares and the structure of shareholders, and the
structure of assets and liabilities of the company
□ Applicable Inapplicable
3. Existing internal job shares
□ Applicable Inapplicable
III. Shareholders and Actual Controlling Shareholder
1. Number of Shareholders and Shares
Unit: Share
Total common 5,20 Total common 5,196 Total preference 0 Total preference shareholders with 0
shareholders 0 shareholders at the end of shareholders with the the voting power not recovered at
in the month voting power recovered the end of the month before the day
the reporting before the date of at the end of the of disclosing the annual report(if
period disclosing the annual reporting period (if any)(See Note 8)
report any)(See Note 8)
Shares held by the shareholders holding over 5% shares or the top ten shareholders(excluding shares lent through refinancing)
The number Pledge or freeze
Number of
The Changes in The number of
holdings at
Shareholder Nature of the number of the of unlisted outstanding The
the end of Shares
names shareholders shares in reporting outstanding shares held number
reporting in state
proportion period shares held on the of
period
market
Wafangdian
State-owned 244,000,00 inapplic
Bearing Group 60.61% 0 244,000,000 0 0
shareholder 0 ability
Corporation
AKTIEBOLAGE Foreign inapplic
19.70% 79,300,000 0 0 79,300,000 0
T SKF shareholder ability
China merchants
Foreign inapplic
securities Hong 2.23% 8,995,895 0 0 8,995,895 0
shareholder ability
Kong limited
Domestic inapplic
Huang Junyue 1.81% 7,302,709 0 0 7,302,709 0
shareholder ability
Domestic inapplic
Hu Xiaofeng 0.47% 1,879,277 0 0 1,879,277 0
shareholder ability
BOCI
Foreign inapplic
SECURITIES 0.33% 1,310,000 0 0 1,310,000 0
shareholder ability
LIMITED
GUOTAI JUNAN
SECURITIES(HO Foreign inapplic
0.26% 1,037,111 0 0 1,037,111 0
NGKONG) shareholder ability
LIMITED
Domestic inapplic
Meng Qingliang 0.24% 966,048 0 0 966,048 0
shareholder ability
Domestic inapplic
Jin Yunhua 0.18% 727,900 0 0 727,900 0
shareholder ability
MAN,KWAI Foreign inapplic
0.18% 713,101 0 0 713,101 0
WING 文贵荣 shareholder ability
Where a strategic investor or general legal person
becomes a top 10 shareholder as a result of the none
placement of new shares (if any) (see Note 3)
Among the top ten shareholders of the company, there is no correlation
relationship or concerted action between the largest shareholder and other
A description of such shareholder association or shareholders, or between the top ten shareholders of tradable shares, while the
concerted action correlation relationship and concerted action between other shareholders,
between the top ten shareholders of tradable shares, or between the top ten
shareholders of tradable shares and other shareholders are unknown.
50
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Explanation of the aforesaid shareholders'
involvement in entrustment /fiduciary voting rights none
and abandonment of voting rights
Special notes for the repo account among the top 10
none
shareholders (see Note 10)
Shareholding of top 10 shareholders of unrestricted shares
Quantity of unrestricted shares Share type
Shareholder’s Name held
Share type Quantity
at the end of there porting period
AKTIEBOLAGET SKF 79,300,000 B-shares 79,300,000
China merchants securities Hong Kong limited 8,995,895 B-shares 8,995,895
Huang Junyue 7,302,709 B-shares 7,302,709
Hu Xiaofeng 1,879,277 B-shares 1,879,277
BOCI SECURITIES LIMITED 1,310,000 B-shares 1,310,000
GUOTAI JUNAN SECURITIES(HONG KONG) LIMITED 1,037,111 B-shares 1,037,111
Meng Qingliang 966,048 B-shares 966,048
Jin Yunhua 727,900 B-shares 727,900
MAN,KWAI WING 文贵荣 713,101 B-shares 713,101
Jiang Guangsen 687,900 B-shares 687,900
There was no relationship and consistent activities between the
Explanation to the associated relationship or consistent action among
first big shareholder and other shareholders or the top ten
the top 10 shareholders of non-restricted negotiable shares and that
common stock holders; The relationship among other
between the top 10 shareholders of non-restricted negotiable shares
shareholders, top ten circulation shareholders, top ten
and top 10 shareholders.
circulation shareholders and other shareholders was not clear.
Description of Top 10 Common Shareholders' Participation in Margin
none
and Short Selling Business (if any) (see Note 4)
The lending of shares by the top ten shareholders in the refinancing business
Applicable Not applicable
The top ten shareholders changed from the previous period
Applicable Not applicable
Whether the top 10 common shareholders of the Company and the top 10 common shareholders with
unlimited conditions conducted agreed repurchase transactions during the reporting period
□Yes No
The top 10 common shareholders of the Company and the top 10 common shareholders with unlimited
conditions did not enter into agreed repurchase transactions during the reporting period.
2. Controlling Shareholder
Nature of the controlling shareholder: State-owned holding directly under the Dalian government
Legal Date of
Name of the Represen incorporati Organizati
Main Business
Controlling tative/Le on on code
Shareholder ader
Bearing, bearing spare parts, bearing special tools, tooling,
equipment, mechanical equipment, abrasives, abrasives, casting,
Wafangdian 91210200 auto parts, locomotive parts and related industrial products
Bearing Group Liu Jun 1995.10.22 24238666 manufacturing and sales; Bearing design, repair, maintenance
Corporation 3D and technical services; Procurement and sales of bearing raw
materials and auxiliary materials; House leasing and equipment
leasing.
The shareholding of the
controlling shareholder of
other listed companies at none
home and abroad during the
reporting period
51
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Type of the controlling shareholder: corporate Legal Person
Change of Controlling Shareholder in the Report Period
□ Applicable Inapplicable
The controlling shareholder of the company has not changed during the reporting period.
3. Actual Controller
Nature of the actual controller: State-owned assets regulatory agency directly under the Dalian government
Type of the actual controller: corporate
Legal Establishing Organization Register
Name of the actual controller
Representative Date Code Capital
On behalf of the people's government of Dalian, the
Dalian Municipal Government State-
people's government shall perform the functions and
owned Assets Supervising and Cao De Jun 2004.09.30 No
responsibilities of the state-owned assets, and supervise
Managing committee
and administer the state-owned assets.
Equity in other domestic and foreign
listed companies held by the actual
Other domestic and foreign listed companies controlled by the actual controller during the reporting
controller by means of control and
period include: Dalian Heavy Industry (002204)
mutual shareholding in the reporting
period
Actual controller changes during the reporting period
Applicable Inapplicable
The actual controller of the company has not changed during the reporting period.
A block diagram of the property rights and control relationship between the company and the actual
controller
Actual Controller controlled the Company by trust or other asset management method.
□ Applicable Inapplicable
4. The total amount of shares pledged by the controlling shareholder or the largest shareholder and
the person acting in concert accounts for 80% of the company's shares held by them
Applicable Inapplicable
5.Other shareholders with more than 10% shares
52
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Applicable Inapplicable
Legal Date of
Name Capital Main Business
Representative establishment
Bearings, seals and
AKTIEBOLAGET 1,138,000,000 relative products,
Rickard Gustafson 1907.01.01
SKF （SKR） and relative
services
6. Shareholding Reduction Restriction on the Controlling Shareholder, the Actual Controller, the
Reorganizing Party and other Commiting Party
□ Applicable Inapplicable
Iv. Specific implementation of share repurchase during the reporting period
The implementation progress of share repurchase
Applicable Inapplicable
The implementation progress of reducing repurchased shares by means of centralized bidding
Applicable Inapplicable
Chapter VIII. About the Preferred Shares
□ Applicable Inapplicable
Chapter IX. Related information of convertible bonds
□ Applicable Inapplicable
Chapter X Financial report
I.Financial report
Types of Audit opinions Standard unreserved opinion
Date of audit report signing April 26, 2024
Lipan Certified Public Accountants (Special General
Name of audit institution
Partnership)
Audit report number Xin Kuai Shi Bao Zi [2024] No. ZE10289
Name of auditor Cui Song,Guo Yaowu
Auditor's Report
To the Shareholders of Wafangdian Bearing Company Limited:
Opinion
We have audited the accompanying financial statements of Wafangdian Bearing Company Limited
(“Wafangdian Bearing Company”), which comprise the consolidated and company's balance sheets as
at 31 December 2023, the consolidated and company's income statements, the consolidated and
company's statements of cash flows, and the consolidated and company's statements of changes in
owners' equity for the year then ended, and notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects, the
consolidated and company's financial position as at 31 December 2023 and the consolidated and
company's financial performance and cash flows for the year then ended in accordance with the
requirements of Accounting Standards for Business Enterprises.
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Basis for Opinion
We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Our
responsibilities under those standards are further described in the Auditor's Responsibilities for the
Audit of the Financial Statements section of our report. We are independent of Wafangdian Bearing
Company in accordance with the Code of Ethics for Professional Accountants of the Chinese Institute
of Certified Public Accountants (“CICPA Code”), and we have fulfilled our other ethical
responsibilities in accordance with the CICPA Code. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
We identified the following key audit matters in our audit:
1. [Revenue recognition]
2. [Recoverability of accounts receivable]
How these matters were addressed in the audit
Key Audit Matters
process
1. [Revenue recognition]
The audit procedures we performed on revenue
recognition consisted primarily of:
1. Pnderstanding, evaluating and testing the
effectiveness of the design and implementation
of management's key internal controls related to
revenue recognition;
2. Performing analytical review procedures to
For details of the accounting policy for revenue analyze the reasonableness of changes in revenue
recognition and analysis of revenue, please refer and gross profit margin;
to the accounting policy described in Note (22) of 3. Select a sample to examine sales contracts,
the Notes to Consolidated Financial Statements identify contractual provisions related to the
"III. Significant Accounting Policies and transfer of control of goods, and evaluate
Accounting Estimates" and Note (36) of the Notes whether the revenue recognition point of
to Consolidated Financial Statements. Wafangdian Bearing Company Corporation
meets the requirements of the Enterprise
Revenue from sales of various types of bearings in Accounting Standards;
the consolidated statements of operations of 4. Selecting samples of revenue transactions
Wafangdian Bearing Company for fiscal 2023 recorded during the year, verifying whether the
amounted to CNY 2,093,582,371.38. book revenue, sales invoices and customer
confirmation sheets are consistent, and
Since revenues and profits from bearing sales evaluating whether the relevant revenue
have a significant impact on the Company's recognition is in accordance with the revenue
results, the recognition of revenues depends on the recognition accounting policy of Wafangdian
ability to properly assess whether the product Bearing Company;
sales satisfy the agreement on the conditions for 5. Implementing correspondence to customers.
the transfer of control in the sales contract. The The correspondence procedure includes
complexity of the commercial agreements, correspondence on the balance of accounts
however, requires separate judgment. For this receivable at the end of the customer's period as
reason, we identified revenue as a key audit well as sales during the reporting period;
matter. 6. For shipment records around the balance sheet
54
Wafangdian Bearing Co., Ltd. 2023 annual report full text
How these matters were addressed in the audit
Key Audit Matters
process
date, select samples and check the supporting
documents such as shipment records and
customer acknowledgement slips to evaluate
whether revenues are included in the appropriate
period.
2. [Recoverability of accounts receivable]
For details of the accounting policies and analysis
of accounts receivable, please refer to the
accounting policies described in Note (ix) to the
consolidated financial statements under "III. The audit procedures we performed on the
Significant Accounting Policies and Estimates" collectability of accounts receivable consisted
and Note (iv) to the consolidated financial primarily of:
statements under "V. Notes to Consolidated 1. understanding, evaluating and testing the
Financial Statements". effectiveness of management's design and
implementation of internal controls related to the
The balance of accounts receivable in the aging analysis of accounts receivable and the
consolidated financial statements as of December determination of the allowance for bad debts on
31, 2023 was CNY 1,217,457,042.95 and the accounts receivable;
allowance for bad debts was CNY 2. reviewing management's consideration and
131,019,034.27, net of CNY objective evidence related to the impairment
1,086,438,008.68.The balance of contractual testing of accounts receivable and focusing on
assets was CNY 5,858,045.86, provision for whether management has adequately identified
impairment of contract assets was CNY items that have been impaired;
292,902.29, net of contractual assets was CNY 3. for accounts receivable for which management
5,565,143.57. has provided for bad debts according to a
combination of credit risk characteristics,
We identified the collectability of accounts evaluating whether the percentage of provision
receivable as a key audit matter because for bad debts determined by management is
estimating the collectability of accounts receivable reasonable;
and testing for impairment involves significant 4. Implemented the correspondence procedure
accounting estimates and judgments by and reconciled the results of the correspondence
management, and the impact on the financial with the amounts recorded by management;
statements if the accounts receivable is not 5. Evaluating the reasonableness of the provision
collected on time or are uncollectible is more for bad debts reserves by management in
significant. conjunction with the post-period payback
examination.
Other Information
Management of Wafangdian Bearing Company (“Management”) is responsible for the other
information. The other information comprises all of the information included in the 2023 annual report
of Wafangdian Bearing Company, other than the financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated.
55
Wafangdian Bearing Co., Ltd. 2023 annual report full text
If, based on the work we have performed, we conclude that there is a material misstatement of the
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with the requirements of Accounting Standards for Business Enterprises, and for such
internal control as management determines is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing Wafangdian Bearing
Company's ability to continue as a going concern, disclosing, if applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to liquidate
Wafangdian Bearing Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing Wafangdian Bearing Company’s
financial reporting process.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with CSAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
As part of an audit in accordance with CSAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
(2) Obtain an understand of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
56
Wafangdian Bearing Co., Ltd. 2023 annual report full text
(4) Conclude on the appropriateness of management's use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists related
to events or conditions that may cast significant doubt on Wafangdian Bearing Company's ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related disclosures in the financial statements or, if
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor's report. However, future events or conditions may
cause Wafangdian Bearing Company to cease to continue as a going concern.
(5) Evaluate the overall presentation (including the disclosures), structure and contents of the
financial statements, and whether the financial statements represent the underlying transactions
and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within Wafangdian Bearing Company to express an opinion on the
consolidated financial statements. We are responsible for the direction, supervision and
performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence and, where applicable, related
safeguards.
From the matters communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor's report unless law or
regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences
of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
II. Financial statements
The unit of the statements in the financial notes is: yuan
1. Consolidate balance sheets
Compiled by: Wafangdian Bearing Co., LTD
26 April 2024
Unit：yuan
project 2023.12.31 2023.1.1
Current assets:
57
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Monetary funds 210,814,228.05 330,746,706.88
Settlement of provisions
Loan funds
Trading financial assets 214,178.33 243,454.50
Derivative financial assets
Notes receivable 450,721,512.23 469,784,593.61
Accounts receivable 1,086,438,008.68 1,136,295,329.59
Financing of receivables 55,546,474.87 30,996,930.63
prepayment 16,939,892.67 52,901,066.01
Premium receivable
Reinsurance accounts receivable
Reserves receivable for reinsurance contracts
Other receivables 9,403,175.09 10,555,282.33
Among them: interest receivable
Dividends receivable
Buy and resell financial assets
inventory 651,494,088.99 646,619,143.91
Contractual assets 5,565,143.57 601,375.84
Holding assets for sale
Non-current assets due within one year
Other current assets 47,560,917.19 15,681,599.83
Total current assets 2,534,697,619.67 2,694,425,483.13
Non-current assets:
Make loans and advances
Debt investment
Other debt investments
Long-term receivables
Long-term equity investment
Investment in other equity instruments 11,910,077.43 11,926,856.64
Other non-current financial assets
Investment real estate 68,614,653.76 67,211,806.69
Fixed assets 448,651,044.66 391,769,315.64
Construction in progress 37,354,969.68 81,891,139.54
Productive biological assets
Oil and gas assets
Use right assets
Intangible assets 74,319,876.46 77,438,618.71
Development expenditure
goodwill
Long-term deferred expenses 4,842,981.32 114,379.51
Deferred tax assets
Other non-current assets
58
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Total non-current assets 645,693,603.31 630,352,116.73
Total assets 3,180,391,222.98 3,324,777,599.86
Current liabilities:
Short-term loan 598,000,000.00 699,000,000.00
Borrow from the central bank
Borrowed funds
Trading financial liabilities
Derivative financial liability
Notes payable 460,840,218.52 462,446,562.00
Accounts payable 1,269,200,269.48 1,300,975,034.72
Advances received
Contractual liability 30,546,735.85 30,449,983.07
Selling repurchase funds of financial assets
Deposit-taking and interbank deposits
Agent to buy and sell securities
Agent underwrites securities
Employee compensation payable 47,130,138.90 46,797,303.83
Taxes payable 20,327,848.00 26,467,193.95
Other payables 185,396,158.28 180,459,153.26
Among them: interest payable
Dividends payable
Commissions and commissions payable
Reinsurance accounts payable
Holding liabilities held for sale
Non-current liabilities due within one year
Other current liabilities 4,574,730.79 4,294,078.63
Total current liabilities 2,616,016,099.82 2,750,889,309.46
Non-current liabilities:
Insurance contract reserve
Long-term loan 99,450,000.00
Bonds payable
Among them: preferred stock
Perpetual debt
Lease liability
Long-term payables 344,974.84 344,974.84
Long-term employee compensation payable
Projected liability 49,598,202.66 54,288,933.94
Deferred income 43,100,180.40 48,324,479.14
Deferred income tax liabilities 575,697.11 626,909.02
Other non-current liabilities
Total non-current liabilities 193,069,055.01 103,585,296.94
Total liabilities 2,809,085,154.83 2,854,474,606.40
Owner's equity:
59
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Capital stock 402,600,000.00 402,600,000.00
Other equity instruments
Among them: preferred stock
Perpetual debt
Capital reserve 485,691,050.47 485,691,050.47
Minus: Treasury stocks
Other comprehensive income
Special reserve 2,414,877.63 1,933,209.86
Surplus reserve 136,770,391.01 136,770,391.01
General risk reserve
Undistributed profit -656,170,250.96 -556,691,657.88
Total owner's equity attributable to parent company 371,306,068.15 470,302,993.46
Minority shareholders' interests
Total owners' equity 371,306,068.15 470,302,993.46
Total liabilities and equity 3,180,391,222.98 3,324,777,599.86
Chairman: Liu Jun General Accountant : Sun Najuan Accounting charger:Sun Xinyan
2. Balance Sheet Of Parent Company
Unit:yuan
project 2023.12.31 2023.1.1
Current assets:
Monetary funds 202,953,597.29 318,183,659.51
Trading financial assets 214,178.33 243,454.50
Derivative financial assets
Notes receivable 448,340,987.89 364,368,224.60
Accounts receivable 1,083,227,562.84 1,091,791,757.46
Financing of receivables 55,246,474.87 29,782,015.63
prepayment 16,088,770.08 50,382,150.52
Other receivables 302,051,507.57 326,487,410.20
Among them: interest receivable
Dividends receivable 11,843,105.36 11,843,105.36
inventory 409,679,963.66 372,399,880.38
Contractual assets 5,565,143.57 601,375.84
Holding assets for sale
Non-current assets due within one year
Other current assets 47,560,917.19 15,681,599.83
Total current assets 2,570,929,103.29 2,569,921,528.47
Non-current assets:
Debt investment
Other debt investments
Long-term receivables
Long-term equity investment 226,488,897.67 225,693,897.67
Investment in other equity instruments 11,910,077.43 11,926,856.64
Other non-current financial assets
Investment real estate 62,796,748.61 61,104,869.06
Fixed assets 284,111,056.47 246,219,058.48
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Construction in progress 37,233,550.11 50,350,325.78
Productive biological assets
Oil and gas assets
Use right assets
Intangible assets 59,940,265.41 62,341,050.02
Development expenditure
goodwill
Long-term deferred expenses 4,842,981.32 114,379.51
Deferred tax assets
Other non-current assets
Total non-current assets 687,323,577.02 657,750,437.16
Total assets 3,258,252,680.31 3,227,671,965.63
Current liabilities:
Short-term loan 598,000,000.00 699,000,000.00
Trading financial liabilities
Derivative financial liability
Notes payable 460,840,218.52 462,446,562.00
Accounts payable 1,173,929,299.34 1,086,746,790.62
Advances received
Contractual liability 30,499,770.66 30,055,311.74
Employee compensation payable 39,558,601.86 39,688,497.98
Taxes payable 14,791,557.01 17,639,022.52
Other payables 168,205,349.94 162,798,263.19
Among them: interest payable
Dividends payable
Holding liabilities held for sale
Non-current liabilities due within one year
Other current liabilities 4,568,625.32 4,244,919.76
Total current liabilities 2,490,393,422.65 2,502,619,367.81
Non-current liabilities:
Long-term loan 99,450,000.00
Bonds payable
Among them: preferred stock
Perpetual debt
Lease liability
Long-term payables 244,974.84 244,974.84
Long-term employee compensation payable
Projected liability 49,566,496.84 54,260,539.91
Deferred income 15,525,886.47 19,864,106.94
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 164,787,358.15 74,369,621.69
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Total liabilities 2,655,180,780.80 2,576,988,989.50
Owner's equity:
Capital stock 402,600,000.00 402,600,000.00
Other equity instruments
Among them: preferred stock
Perpetual debt
Capital reserve 485,678,443.26 485,678,443.26
Minus: Treasury stocks
Other comprehensive income
Special reserve 441,390.04
Surplus reserve 136,770,391.01 136,770,391.01
Undistributed profit -421,976,934.76 -374,807,248.18
Total owners' equity 603,071,899.51 650,682,976.13
Total liabilities and equity 3,258,252,680.31 3,227,671,965.63
3. Consolidated income statement
Unit:yuan
project 2023 2022
I. Gross operating income 2,193,273,682.20 2,348,330,561.57
Among them: operating income 2,193,273,682.20 2,348,330,561.57
Interest income
Earned premium
Fee and commission income
Ii. Total operating costs 2,316,003,617.97 2,450,935,364.34
Among them: operating cost 1,820,709,965.29 1,897,907,415.41
Interest expense
Commission and commission expenses
Surrender premium
Net claims disbursement
Net reserve for insurance liability contracts
Policy dividend payout
Reinsurance expense
Taxes and surcharges 13,938,931.92 12,737,534.70
Selling expense 159,770,917.31 162,537,964.38
Administrative expenses 127,607,078.59 115,099,647.00
Research and development expenses 157,836,380.65 231,245,330.98
Financial expense 36,140,344.21 31,407,471.87
Among them: interest expense 40,071,255.06 36,216,652.32
Interest income 1,532,778.11 1,197,047.65
Plus: Other earnings 33,490,766.62 7,068,347.57
Investment income (loss marked with "-") 12,935,641.78 6,892,627.00
Among them: income from investment in joint
venture and joint venture
Financial assets measured at amortized
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
cost cease to recognize income
Exchange gain (loss marked with "-")
Net exposure hedge gain (loss marked with "-")
Gain on changes in fair value (loss marked with "-") -29,276.17 -78,583.43
Credit impairment loss (loss marked with "-") -8,190,595.50 14,149,185.05
Asset impairment loss (marked with "-") -16,570,748.46 -70,762,726.02
Gain on disposal of assets (loss marked with "-") 1,406,119.64 2,110,473.61
Iii. Operating profit (loss marked with "-") -99,688,027.86 -143,225,478.99
Plus: non-operating income 603,316.44 3,927,967.83
Less: non-operating expenses 445,093.57 656,315.14
Iv. Total Profit (total loss marked with "-") -99,529,804.99 -139,953,826.30
Less: Income tax expense -51,211.91 -56,327.43
V. Net profit (marked with "-" for net loss) -99,478,593.08 -139,897,498.87
(1) Classification by business continuity
1. Net profit from continuing operations (marked with "-"
-99,478,593.08 -139,897,498.87
for net loss)
2. Net profit of discontinued operations (marked with "-"
for net loss)
(2) Classification according to ownership
1. Net profit attributable to shareholders of parent
-99,478,593.08 -139,897,498.87
company
2. Profit and loss of minority shareholders
Vi. Net of other comprehensive income after tax
Net of other comprehensive income attributable to the
owner of the parent company after tax
(1) Other comprehensive income that cannot be
reclassified into profit or loss
1. Remeasure and set the variation of benefit plan
2. Other comprehensive income that cannot be
transferred to profit or loss under the equity method
3. Changes in fair value of investments in other equity
instruments
4. Changes in the fair value of the enterprise's own
credit risk
5. Others
(2) Other comprehensive income reclassified into profit or
loss
1. Other comprehensive income that can be
transferred to profit or loss under the equity method
2. Changes in the fair value of other creditor's rights
investments
3. The amount of financial assets reclassified into other
comprehensive income
4. Reserve for credit impairment of other creditor's
rights investments
5. Cash flow hedge reserve
6. Difference in translation of foreign currency financial
statements
7. Others
Net of other comprehensive income attributable to minority
shareholders after tax
Vii. Total comprehensive income -99,478,593.08 -139,897,498.87
Total comprehensive income attributable to the owner of -99,478,593.08 -139,897,498.87
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
the parent company
Total comprehensive income attributable to minority
shareholders
Viii. Earnings per share
(1) Basic earnings per share -0.2471 -0.3475
(2) Diluted earnings per share -0.2471 -0.3475
Chairman: Liu Jun General Accountant : Sun Najuan Accounting charger:Sun Xinyan
4. Income Sheet of Parent Company.
Unit: RMB Yuan
item 2023 2022
I. Operating income 2,220,459,530.92 2,391,189,210.72
Less: operating costs 1,839,008,209.00 1,938,358,741.32
Taxes and surcharges 10,941,033.02 10,972,553.48
Selling expense 150,633,675.33 153,124,248.33
Administrative expenses 101,958,194.37 91,238,538.03
Research and development expenses 152,103,642.61 225,860,513.24
Financial expense 36,168,494.80 31,180,257.00
Among them: interest expense
Interest income
Plus: Other earnings 32,292,962.05 5,641,327.34
Investment income (loss marked with "-") 10,260,371.82 4,115,928.61
Among them: income from investment in joint
venture and joint venture
Financial assets measured at amortized cost cease to
recognize income (loss marked with "-")
Net exposure hedge gain (loss marked with "-")
Gain on changes in fair value (loss marked with "-") -29,276.17 -78,583.43
Credit impairment loss (loss marked with "-") -8,280,898.36 14,020,645.51
Asset impairment loss (marked with "-") -12,436,058.16 -47,759,299.50
Gain on disposal of assets (loss marked with "-") 964,764.68 2,110,473.61
II. Operating profit (loss marked with "-") -47,581,852.35 -81,495,148.54
Plus: non-operating income 577,544.94 3,172,630.58
Less: non-operating expenses 165,379.17 620,179.18
III. Total Profit (total loss marked with "-") -47,169,686.58 -78,942,697.14
Less: Income tax expense
Iv. Net Profit (marked with "-" for net loss) -47,169,686.58 -78,942,697.14
(1) Net profit from continuing operations (marked with "-
-47,169,686.58 -78,942,697.14
" for net loss)
(2) Net profit from discontinued operations (marked with
"-" for net loss)
V.Net of other comprehensive income after tax
(1) Other comprehensive income that cannot be
reclassified into profit or loss
1. Remeasure and set the variation of benefit plan
2. Other comprehensive income that cannot be
transferred to profit or loss under the equity method
3. Changes in fair value of investments in other
equity instruments
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
4. Changes in the fair value of the enterprise's own
credit risk
5. Others
(2) Other comprehensive income reclassified into
profit or loss
1. Other comprehensive income that can be
transferred to profit or loss under the equity method
2. Changes in the fair value of other creditor's rights
investments
3. The amount of financial assets reclassified into
other comprehensive income
4. Reserve for credit impairment of other creditor's
rights investments
5. Cash flow hedge reserve
6. Difference in translation of foreign currency
financial statements
7. Others
VI. Total comprehensive income -47,169,686.58 -78,942,697.14
VII. Earnings per share
(1) Basic earnings per share -0.1172 -0.1961
(2) Diluted earnings per share -0.1172 -0.1961
5. Consolidated Cash Flow Statement.
Unit:yuan
Item 2023 2022
I. Cash flows generated from operating activities:
Cash received from sales of goods and services
984,173,942.11 1,209,679,135.22
provided
Net increase in customer deposits and interbank
deposits
Net increase in borrowing from the Central bank
Net increase of funds borrowed from other financial
institutions
Cash from receipt of premiums from the original
insurance contract
Net cash received from reinsurance operations
Net increase of depository and investment funds
Cash for interest, charges and commissions
Net increase in borrowed funds
Net increase in repurchase funds
Net cash received from agents buying and selling
securities
Tax refunds received 28,855,027.41 23,491,073.28
Other cash received in connection with operating
34,781,896.01 44,357,724.91
activities
Subtotal of cash inflow from operating activities 1,047,810,865.53 1,277,527,933.41
Cash paid for goods purchased or services received 368,564,412.78 622,977,120.31
Net increase in customer loans and advances
Net increase in central bank and interbank deposits
Cash payable on the original insurance contract
Net increase of funds sold out
Cash to pay interest, fees and commissions
Cash to pay dividends on policies
65
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Cash paid to and for employees 379,563,765.00 380,144,468.90
All taxes paid 75,682,959.24 47,043,087.07
Disburse other cash in connection with operating
139,677,036.36 143,097,707.23
activities
Subtotal of cash outflow from operating activities 963,488,173.38 1,193,262,383.51
Net cash flow from operating activities 84,322,692.15 84,265,549.90
Ii. Cash Flows generated from investment activities:
Recovery of cash received from investment
Cash received from investment income 2,003,723.34 23,851.89
Net cash recovered from disposal of fixed assets,
468,000.00 1,772,810.00
intangible assets and other long-term assets
Net cash received on disposal of subsidiaries and other
operating units
Other cash received in connection with investment
activities
Subtotal of cash inflows from investing activities 2,471,723.34 1,796,661.89
Cash paid for the purchase and construction of fixed
5,430,485.57 12,861,168.20
assets, intangible assets and other long-term assets
Cash paid by investment
Net increase in pledged loans
Obtain net cash paid by subsidiaries and other business
units
Disburse cash in connection with other investment
activities
Subtotal cash outflow from investment activities 5,430,485.57 12,861,168.20
Net cash flow from investing activities -2,958,762.23 -11,064,506.31
Iii. Cash Flows generated by financing Activities:
Absorb cash received from investments
Among them: subsidiaries absorb minority shareholders
investment received cash
Obtain cash received on loan 848,000,000.00 1,018,000,000.00
Other cash received in connection with fund-raising
514,194,933.95 148,898,875.78
activities
Subtotal cash inflow from financing activities 1,362,194,933.95 1,166,898,875.78
Cash to pay off debts 849,550,000.00 996,000,000.00
Cash disbursed to distribute dividends, profits, or
34,675,404.85 29,831,754.10
interest payments
Among them: dividends and profits paid by subsidiaries
to minority shareholders
Disburse cash in connection with other fundraising
679,042,593.69 199,211,995.47
activities
Subtotal cash outflow from financing activities 1,563,267,998.54 1,225,043,749.57
Net cash flows from financing activities -201,073,064.59 -58,144,873.79
IV. The impact of exchange rate changes on cash and
3,016,403.93 2,453,225.15
cash equivalents
V. Net increase in cash and cash equivalents -116,692,730.74 17,509,394.95
Plus: Starting cash and cash equivalents balance 227,357,291.37 209,847,896.42
Vi. Balance of cash and cash equivalents at the end of the
110,664,560.63 227,357,291.37
period
6. Cash Flow Statement Of Parent Company.
Unit: RMB yuan
ITEM 2023 2022
I. Cash flows generated from operating activities:
Cash received from sales of goods and services
966,994,345.88 1,174,553,672.55
provided
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Tax refunds received 28,851,520.11 19,041,056.13
Other cash received in connection with operating
31,636,985.03 52,254,951.21
activities
Subtotal of cash inflow from operating activities 1,027,482,851.02 1,245,849,679.89
Cash paid for goods purchased or services received 467,383,945.58 625,427,237.31
Cash paid to and for employees 307,534,709.71 300,379,827.56
All taxes paid 55,656,359.99 36,122,880.68
Disburse other cash in connection with operating
107,140,110.20 114,758,167.09
activities
Subtotal of cash outflow from operating activities 937,715,125.48 1,076,688,112.64
Net cash flow from operating activities 89,767,725.54 169,161,567.25
Ii. Cash Flows generated from investment activities:
Recovery of cash received from investment
Cash received from investment income 2,003,723.34 23,851.89
Net cash recovered from disposal of fixed assets,
468,000.00 1,772,810.00
intangible assets and other long-term assets
Net cash received on disposal of subsidiaries and other
operating units
Other cash received in connection with investment
activities
Subtotal of cash inflows from investing activities 2,471,723.34 1,796,661.89
Cash paid for the purchase and construction of fixed
5,378,102.35 7,104,306.36
assets, intangible assets and other long-term assets
Cash paid by investment 795,000.00 4,110,000.00
Obtain net cash paid by subsidiaries and other business
units
Disburse cash in connection with other investment
activities
Subtotal cash outflow from investment activities 6,173,102.35 11,214,306.36
Net cash flow from investing activities -3,701,379.01 -9,417,644.47
Iii. Cash Flows generated by financing Activities:
Absorb cash received from investments
Obtain cash received on loan 848,000,000.00 1,018,000,000.00
Other cash received in connection with fund-raising
514,047,683.95 69,878,631.34
activities
Subtotal cash inflow from financing activities 1,362,047,683.95 1,087,878,631.34
Cash to pay off debts 849,550,000.00 996,000,000.00
Cash disbursed to distribute dividends, profits, or interest
34,675,404.85 29,831,754.10
payments
Disburse cash in connection with other fundraising
678,895,343.69 199,211,995.47
activities
Subtotal cash outflow from financing activities 1,563,120,748.54 1,225,043,749.57
Net cash flows from financing activities -201,073,064.59 -137,165,118.23
IV. The impact of exchange rate changes on cash and
3,016,403.93 2,453,225.15
cash equivalents
V. Net increase in cash and cash equivalents -111,990,314.13 25,032,029.70
Plus: Starting cash and cash equivalents balance 214,794,244.00 189,762,214.30
Vi. Balance of cash and cash equivalents at the end of the
102,803,929.87 214,794,244.00
period
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
7. Consolidated Sheet Of Changes In Shareholder’s Equity
This amount
Unit: RMB yuan
The year in2023
Owner’s equity attributable to parent company
Other equity instruments Less: Other Genera
Item The Minority Total owners'
Prefer Sustai Capital invento comprehe Surplus l risk Undistribute oth
Capital stock special subtotal equity equity
red nable other reserves ry nsive reserves provisi d profit er
reserve
stock debt stocks income on
I.Ending -
402,600,000. 1,933,20 136,770,3 470,302,993.
balance of last 485,691,050.47 556,691,657 470,302,993.46
year 00 9.86 91.01 46
.88
Plus: changes
in accounting
policies
Advance error
correction
Merger of
enterprises
under the same
control
other
II.Balance at
-
the beginning 402,600,000. 1,933,20 136,770,3 470,302,993.
485,691,050.47 556,691,657 470,302,993.46
of the current 00 9.86 91.01 46
.88
year
III. Amount of
increase or
- -
decrease in 481,667.
99,478,593. 98,996,925.3 -98,996,925.31
current period 77
08 1
(marked with "-
" for decrease)
(1) Total - -
comprehensive 99,478,593. 99,478,593.0 -99,478,593.08
income 08 8
(2) capital input
or reduction by
the owner
1. Common
68
Wafangdian Bearing Co., Ltd. 2023 annual report full text
stock invested
by the owner
2. Capital
invested by
holders of other
equity
instruments
3. Amount of
share payments
credited to
owners' equity
4. Other
(3) Profit
distribution
1. Withdraw
surplus reserve
2. Extract
general risk
provisions
3. Distribution
to owners (or
shareholders)
4. Other
(4)Internal
carryover of
owners' equity
1. Conversion
of capital
reserves to
increased
capital (or
capital stock)
2. Conversion
of surplus
reserves to
increased
capital (or
equity)
3. The surplus
69
Wafangdian Bearing Co., Ltd. 2023 annual report full text
reserves make
up the losses
4. Set changes
in benefit plan
to carry
forward
retained
earnings
5. Carry-over
of other
comprehensive
income to
retained
earnings
6. Other
(5) Special 481,667.
481,667.77 481,667.77
reserve 77
1. Current 14,207,6 14,207,667.8
14,207,667.88
extraction 67.88 8
13,726,0 13,726,000.1
2. Current use 13,726,000.11
00.11 1
(6) Others
4. Ending -
402,600,000. 2,414,87 136,770,3 371,306,068.
balance of 0.00 0.00 0.00 485,691,050.47 0.00 656,170,250 371,306,068.15
00 7.63 91.01 15
current period .96
The amount of the previous
Unit: RMB yuan
The year in2022
Owner’s equity attributable to parent company
Other equity
Less: Other Gener
Item instruments The Minority Total owners'
Capital Capital invent compreh Surplus al risk Undistribut oth
Prefe Susta special subtotal equity equity
stock reserves ory ensive reserves provis ed profit er
rred inable other reserve
stocks income ion
stock debt
I.Ending -
402,600,00 485,691,050. 136,770, 608,267,28
balance of last 0.00 416,794,15 608,267,282.47
0.00 47 391.01 2.47
year 9.01
Plus: changes
in accounting
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
policies
Advance error
correction
Merger of
enterprises
under the
same control
other
II.Balance at
-
the beginning 402,600,00 485,691,050. 136,770, 608,267,28
416,794,15 608,267,282.47
of the current 0.00 47 391.01 2.47
9.01
year
III. Amount of
increase or
decrease in - -
1,933,2
current period 139,897,49 137,964,28 -137,964,289.01
09.86
(marked with 8.87 9.01
"-" for
decrease)
(1) Total - -
comprehensiv 139,897,49 139,897,49 -139,897,498.87
e income 8.87 8.87
(2) capital
input or
reduction by
the owner
1. Common
stock invested
by the owner
2. Capital
invested by
holders of
other equity
instruments
3. Amount of
share
payments
credited to
owners' equity
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
4. Other
(3) Profit
distribution
1. Withdraw
surplus
reserve
2. Extract
general risk
provisions
3. Distribution
to owners (or
shareholders)
4. Other
(4)Internal
carryover of
owners' equity
1. Conversion
of capital
reserves to
increased
capital (or
capital stock)
2. Conversion
of surplus
reserves to
increased
capital (or
equity)
3. The surplus
reserves
make up the
losses
4. Set
changes in
benefit plan to
carry forward
retained
earnings
5. Carry-over
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
of other
comprehensiv
e income to
retained
earnings
6. Other
(5) Special 1,933,2 1,933,209.8
1,933,209.86
reserve 09.86 6
1. Current 11,704, 11,704,037.
11,704,037.42
extraction 037.42 42
9,770,8 9,770,827.5
2. Current use 9,770,827.56
27.56 6
(6) Others
4. Ending -
402,600,00 485,691,050. 1,933,2 136,770, 470,302,99
balance of 556,691,65 470,302,993.46
0.00 47 09.86 391.01 3.46
current period 7.88
8. Sheet Of Changes In Shareholder’s Equity Of Parent Company.
This amount
Unit: RMB yuan
2023
Other equity instruments The
Less: Other speci
Item Capital Capital Surplus Undistributed Total owners'
Preferred Sustainab othe inventor comprehensi al other
stock reserves reserves profit equity
stock le debt r y stocks ve income reserv
e
402,600,000. 485,678,443.2 441,39 136,770,391.0 -
I.Ending balance of last year 650,682,976.13
00 6 0.04 1 374,807,248.18
Plus: changes in accounting
policies
Advance error correction
other
II.Balance at the beginning 402,600,000. 485,678,443.2 441,39 136,770,391.0 -
650,682,976.13
of the current year 00 6 0.04 1 374,807,248.18
III. Amount of increase or
-
decrease in current period
441,39 -47,169,686.58 -47,611,076.62
(marked with "-" for
0.04
decrease)
(1) Total comprehensive -47,169,686.58 -47,169,686.58
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
income
(2) capital input or reduction
by the owner
1. Common stock invested
by the owner
2. Capital invested by
holders of other equity
instruments
3. Amount of share
payments credited to
owners' equity
4. Other
(3) Profit distribution
1. Withdraw surplus reserve
2. Distribution to owners (or
shareholders)
3. The other
(4)Internal carryover of
owners' equity
1. Conversion of capital
reserves to increased capital
(or capital stock)
2. Conversion of surplus
reserves to increased capital
(or equity)
3. Surplus reserves to cover
losses
4. Set changes in benefit
plan to carry forward
retained earnings
5. Carry-over of other
comprehensive income to
retained earnings
6. Other
-
(5) Special reserve 441,39 -441,390.04
0.04
1. Current extraction 9,573, 9,573,422.66
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
422.66
10,014
2. Current use ,812.7 10,014,812.70
0
(6) Others
IV. Ending balance of 402,600,000. 485,678,443.2 136,770,391.0 -
603,071,899.51
current period 00 6 1 421,976,934.76
The amount of the previous
Unit:yuan
2022
Other equity instruments The
Less: Other speci
Item Capital Capital Surplus Undistributed Total owners'
Preferred Sustainab othe inventor comprehensi al other
stock reserves reserves profit equity
stock le debt r y stocks ve income reserv
e
-
402,600,00 485,678,443. 136,770,391. 729,184,283.2
I.Ending balance of last year 0.00 295,864,551.0
0.00 26 01 3
4
Plus: changes in accounting
policies
Advance error correction
other
-
II.Balance at the beginning 402,600,00 485,678,443. 136,770,391. 729,184,283.2
0.00 295,864,551.0
of the current year 0.00 26 01 3
4
III. Amount of increase or
decrease in current period 441,3 - -
(marked with "-" for 90.04 78,942,697.14 78,501,307.10
decrease)
(1) Total comprehensive - -
income 78,942,697.14 78,942,697.14
(2) capital input or reduction
by the owner
1. Common stock invested
by the owner
2. Capital invested by
holders of other equity
instruments
3. Amount of share
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
payments credited to
owners' equity
4. Other
(3) Profit distribution
1. Withdraw surplus reserve
2. Distribution to owners (or
shareholders)
3. The other
(4)Internal carryover of
owners' equity
1. Conversion of capital
reserves to increased capital
(or capital stock)
2. Conversion of surplus
reserves to increased capital
(or equity)
3. Surplus reserves to cover
losses
4. Set changes in benefit
plan to carry forward
retained earnings
5. Carry-over of other
comprehensive income to
retained earnings
6. Other
441,3
(5) Special reserve 441,390.04
90.04
7,186,
1. Current extraction 265.2 7,186,265.21
1
6,744,
2. Current use 875.1 6,744,875.17
7
(6) Others
-
IV. Ending balance of 402,600,00 485,678,443. 441,3 136,770,391. 650,682,976.1
374,807,248.1
current period 0.00 26 90.04 01 3
8
76
Wafangdian Bearing Co., Ltd. 2023 annual report full text
III.The basic information of company
Wafangdian Bearing Company Limited (the “Company”, the “Group” is referred to
“Company” together with its subsidiaries) is a joint stock limited company established in the
People’s Republic of China (the “PRC”) on 16 July, 1996. In the opinion of the directors, its
parent and ultimate holding company is Wafangdian Bearing Group Company Limited
(“Wazhou Group”).
The Company’s B shares have been listed on the Shenzhen Stock Exchange since 19 February,
1997.
The Company’s founding meeting and the first meeting of the first board of directors decided
that the effective date of the shareholding system reorganization in the accounting of the
Company (that is, the date of the establishment of the Company's accounts) was determined as
April 1, 1997 on March 19, 1997.
The Company has obtained the business license of the enterprise legal person on March 20,
1997, and the registration number is DaGongShangQiFaZi24239971-2. The business scope
includes the manufacture and sale of bearings, mechanical equipment, auto parts and related
products.
The Company's B shares were officially listed on the Shenzhen Stock Exchange on March 25,
1 997, raising funds of CNY406.58 million. After the issuance, the Company's registered
capital was CNY330 million.
In accordance with the Supplementary Notice on Issues Concerning the Equity Distribution of
Listed Companies under the Rules Governing the Listing of Stocks of the Shenzhen Stock
Exchange ( hereinafter referred to as the “ Supplementary Notice” ) issued by the Shenzhen
Stock Exchange on August 30, 2006, based on the audited financial report on September 30,
2006, the Company implemented the conversion of capital reserve into share capital, giving 2.2
shares for every 10 shares, and the total share capital increased from 330 million shares to 402.6
million shares, of which Wazhou Group owned the legal person shares increased from 200
million shares to 244 million shares, accounting for 60.6% of the total share capital; the Swedish
SKF Company increased from 65 million shares to 79.3 million shares, accounting for 19.7%
of the total share capital; public shares increased from 65 million shares to 79.3 million shares,
accounting for 19.7% of the total share capital. After the implementation of this plan, the
Company's shareholding structure meets the requirements of the "Supplementary Notice" of the
Shenzhen Stock Exchange.
The parent company is Wazhou Group. General shareholders meeting is the company’s
authority and have the resolution power over company’s business policy, financing,
investment and profit appropriation etc. significant events in accordance with relevant law.
Board of directors is responsible for general meeting and has the power over the company’s
decision making. Management is in charge of implementation of resolution made by general
77
Wafangdian Bearing Co., Ltd. 2023 annual report full text
meeting and board meeting and is responsible for operation management.
The company belongs to the bearing manufacturing industry, mainly engaged in the production
and sales of various types of bearings. The addresses of the registered office and principal place
of business of the Company are No. 1, Phrase 1, North Gongji Street, Wafangdian, Liaoning
Province, and the PRC Legal representative is Liu Jun. Registered according to law, the
business scope of the company is as follows: Licensed items: inspection and testing services,
import and export of goods, import and export of technologies (for items subject to approval
according to law, business activities can only be carried out after approval by relevant
departments, and the specific business items shall be subject to the approval result)Bearing
manufacturing, bearings, gears and transmission components manufacturing, high speed
precision heavy-duty bearing sales, sales bearings, gears and transmission parts, bearing sales,
general equipment manufacturing (excluding special equipment manufacturing), high- speed rail
equipment, parts manufacturing, machinery and equipment sales, rail transportation equipment,
key system and parts sales, sales of lubricating oil, high-speed rail equipment and accessories
sales, Wind generators and spare parts sales, machinery parts, spare parts sales, railway
locomotive vehicle accessories manufacturing, railway locomotive vehicle accessories sales,
auto parts and accessories manufacturing, auto parts wholesale and retail auto parts, metal
products repair, sales metal materials, metal products sales, metal surface treatment and heat
treatment processing, quenching process, machinery parts and spare parts processing, land
use right leasing, housing leasing, non- residential real estate leasing, mechanical equipment
leasing, computer and communication equipment leasing, transportation equipment leasing
service, office equipment leasing service, storage equipment leasing service, special equipment
leasing, labor services (excluding labor dispatch), Technology service, technology development,
technology consultation, technology exchange, technology transfer, technology popularization
(with the exception of the projects subject to approval according to law, independently carry out
business activities according to law with the business license).
These financial statements were approved by the Company's Board of Directors on April 26,
2024.
IV.The basis for the preparation of financial statements
(1) Basis of preparation
The financial statements have been prepared in accordance with the "Accounting Standards for
Business Enterprises - Basic Standards" and various specific accounting standards, guidelines
for the application of accounting standards for business enterprises, interpretations of
accounting standards for business enterprises and other related regulations (hereinafter
collectively referred to as "Accounting Standards for Business Enterprises") issued by the
Ministry of Finance, as well as the relevant provisions of the "General Provisions on Financial
Reporting, No. 15 of the Rules Governing the Preparation of Information Disclosures by
Companies Issuing Public Securities" of the China Securities Regulatory Commission.
78
Wafangdian Bearing Co., Ltd. 2023 annual report full text
(2) Going concern
This financial statements are prepared on the assumption of going concern.
V. Significant Accounting Policies and Accounting Estimates
The group established the accounting policy and estimate, such as operation cycle, bad debt
recognition and measurement, dispatched inventory measurement and classification of fixed
assets and FA’ s depreciation, intangible asset’s amortization, capitalization condition of
research and development expenses, revenue recognition and measurement based on the actual
characters of business operation.
（1）Declaration for compliance with Accounting Standards for Business Enterprises
The financial statements are prepared by the Group according to the requirements of Accounting
Standards for Business Enterprises, and reflect the relative information for the financial
position, operating performance, cash flow of the Group truly and fully.
（2）Accounting period
The Group adopts the Gregorian calendar year as accounting period, i.e. from Jan 1 to Dec 31.
（3）Operating cycle
Normal operating cycle refers to the duration starting from purchasing the assets for manufactuing
up to cash or realization of cash equivalents. The group sets twelve months for one operating
cycle and as the liquidity criterion for assets and liability.
（4）Funcitonal currency
The Group adopts CNY as functional currency.
（5）Accounting for business combination under same control and not under same control
Business combinations under common control: Assets and liabilities acquired by the consolidating
party in a business combination (including goodwill resulting from the acquisition of the
consolidated party by the ultimate controlling party) are measured at the carrying value of the
consolidated party's assets and liabilities in the consolidated financial statements of the ultimate
controlling party at the date of the combination. The difference between the book value of the net
assets acquired in the merger and the book value of the merger consideration paid (or the total
nominal value of shares issued) is adjusted against the equity premium in capital surplus, and if
the equity premium in capital surplus is not sufficient for elimination, retained earnings are
adjusted.
Business combinations not under common control: The cost of the combination is the fair value of
the assets paid, liabilities incurred or assumed and equity securities issued by the purchaser to
obtain control of the acquiree at the date of acquisition. The difference between the cost of the
79
Wafangdian Bearing Co., Ltd. 2023 annual report full text
combination and the share of the fair value of the acquiree's identifiable net assets acquired in the
combination is recognized as goodwill; the difference between the cost of the combination and the
share of the fair value of the acquiree's identifiable net assets acquired in the combination is
recognized in profit or loss for the period. Each identifiable asset, liability and contingent liability
of the acquiree acquired in a merger that meets the recognition criteria is measured at fair value at
the date of acquisition.
Directly related costs incurred for a business combination are recognized in profit or loss as
incurred; transaction costs for issuing equity securities or debt securities for a business
combination are included in the initial recognition amount of the equity securities or debt
securities.
（ 6 ） Criteria for determining control and Method of preparation of consolidated financial
statements
1. Criteria for determining control
The scope of consolidation in the consolidated financial statements is determined on the basis of
control, and the scope of consolidation includes the Company and all of its subsidiaries. Control
means that the Company has power over the investee, enjoys variable returns through its
participation in the investee's related activities, and has the ability to use its power over the
investee to influence the amount of its returns.
2. Consolidation procedures
The Company considers the entire enterprise group as one accounting entity and prepares
consolidated financial statements in accordance with uniform accounting policies to reflect the
financial position, results of operations and cash flows of the enterprise group as a whole. The
effects of internal transactions that occur between the Company and its subsidiaries and between
subsidiaries are eliminated. If an internal transaction indicates an impairment loss on the related
asset, the full amount of such loss is recognized. If the accounting policies and accounting periods
adopted by a subsidiary are not consistent with those of the Company, the necessary adjustments
are made in accordance with the Company's accounting policies and accounting periods when
preparing the consolidated financial statements.
The share of ownership equity, net profit or loss for the period and comprehensive income for the
period attributable to minority shareholders of the subsidiaries are presented separately in the
consolidated balance sheet under the item of ownership equity, in the consolidated income
statement under the item of net profit and in the consolidated statement of total comprehensive
income, respectively. The balance resulting from the subsidiary's minority share of current loss
exceeding the minority's share of the subsidiary's opening ownership interest is eliminated to
reduce shareholders' equity.
80
Wafangdian Bearing Co., Ltd. 2023 annual report full text
(1) Increase number of subsidiaries or operations
During the reporting period, if a subsidiary or business is added as a result of a business
combination under the same control, the operating results and cash flows of the subsidiary or
business from the beginning of the period in which the subsidiary or business is combined to the
end of the reporting period are included in the consolidated financial statements, while the
opening balance of the consolidated financial statements and the relevant items in the comparative
statements are adjusted as if the consolidated reporting entity had existed since the point when the
ultimate controlling party began to control it.
If control over an investee under the same control can be exercised due to additional investment,
equity investments held prior to the acquisition of control over the investee are eliminated from
the opening retained earnings or current profit or loss for the comparative statement period,
respectively, for the relevant gains or losses, other comprehensive income and other changes in
net assets recognized between the later of the date of acquisition of the original equity interest and
the date when the consolidated party and the investee are under the same control and the date of
consolidation.
During the reporting period, the addition of subsidiaries or operations as a result of a business
combination not under common control is included in the consolidated financial statements from
the date of acquisition based on the fair value of each identifiable asset, liability and contingent
liability determined at the date of acquisition.
If, for example, additional investments enable the exercise of control over an investee not under
common control, the equity interest in the investee held prior to the date of acquisition is
remeasured at the fair value of that equity interest at the date of acquisition, and the difference
between the fair value and its carrying amount is recognized as investment income for the current
period. The difference between the fair value and its carrying amount is recognized as investment
income for the period. The equity interest in the investee held prior to the date of acquisition is
transferred to investment income for the period to which the equity interest is transferred under
the equity method.
(2) Disposal of subsidiaries
①General treatment
When control over an investee is lost due to disposal of part of the equity investment or other
reasons, the remaining equity investment after disposal is remeasured at its fair value at the date of
loss of control. The difference between the sum of the consideration received for the disposal of
the equity interest and the fair value of the remaining equity interest, less the sum of the share of
81
Wafangdian Bearing Co., Ltd. 2023 annual report full text
the net assets of the original subsidiary calculated on a continuing basis from the date of
acquisition or the date of consolidation in proportion to the original shareholding and goodwill, is
recognized as investment income in the period in which control is lost. Other comprehensive
income and other changes in owners' equity under the equity method of accounting related to the
equity investment in the original subsidiary that can be reclassified to profit or loss in the future
are transferred to investment income in the current period when control is lost.
②Step-by-step disposal of subsidiaries
Disposal of equity investments in subsidiaries through multiple transactions in steps until the loss
of control, the terms and conditions of the disposal of equity investments in subsidiaries and the
economic impact of each transaction is consistent with one or more of the following, usually
indicating that the multiple transactions are a package deal:
i. The transactions are entered into simultaneously or after taking into account their mutual effects;
ⅱ. These transactions as a whole to achieve a complete business result;
ⅲ. The occurrence of one transaction depends on the occurrence of at least one other transaction;
ⅳ. A transaction is not economical when viewed alone, but is economical when considered
together with other transactions.
If each transaction is a package transaction, each transaction is accounted for as a disposal of a
subsidiary and loss of control; the difference between the disposal price and the share of the net
assets of the subsidiary corresponding to the disposal of the investment before the loss of control
is recognized in the consolidated financial statements as other comprehensive income and is
transferred to profit or loss in the period is lost when control is lost.
If each transaction is not a package transaction, the accounting treatment is based on partial
disposal of the equity investment in the subsidiary without loss of control before the loss of
control; upon the loss of control, the accounting treatment is based on the general treatment of
disposal of subsidiaries.
(3) Purchase of minority interests in subsidiaries
The difference between the newly acquired long-term equity investment due to the purchase of
minority interest and the share of net assets of the subsidiary calculated in proportion to the newly
acquired shareholding on an ongoing basis from the date of acquisition or the date of
consolidation is adjusted to the equity premium in capital surplus in the consolidated balance
sheet; if the equity premium in capital surplus is not sufficient for elimination, it is adjusted to
82
Wafangdian Bearing Co., Ltd. 2023 annual report full text
retained earnings.
(4) Partial disposal of equity investments in subsidiaries without loss of control
The difference between the disposal price and the share of net assets of the subsidiary calculated
on a continuing basis from the date of acquisition or the date of consolidation corresponding to the
disposal of the long-term equity investment is adjusted to the equity premium in capital surplus in
the consolidated balance sheet, and if the equity premium in capital surplus is not sufficient to
offset it, retained earnings are adjusted.
（7）Cash and cash equivalent
The cash listed on the cash flow statements of the Group refers to cash on hand and bank deposit.
The cash equivalents refer to short-term (normally with original maturities of three months or less)
and liquid investments which are readily convertible to known amounts of cash and subject to an
insignificant risk of changes in value.
（8）Translation of foreign currency
1.Foreign currency transaction
Foreign currency transactions are translated at the spot exchange rate issued by People’s Bank of
China (“PBOC”) when the transaction incurs. Monetary assets and liabilities in foreign currencies
are translated into RMB at the exchange rate prevailing at the balance sheet day. Exchange
differences arising from the settlement of monetary items are charged as in profit or loss for the
period. Exchange differences of specific borrowings related to the acquisition or construction of a
fixed asset should be capitalized as occurred, before the relevant fixed asset being acquired or
constructed is ready for its intended uses.
2.Translation of foreign currency financial statements
Assets and liabilities in the balance sheet are translated using the spot rate of exchange at the
balance sheet date; items in owners' equity, except for "undistributed earnings", are translated
using the spot rate of exchange at the time of occurrence. Income and expense items in the income
statement are translated using the spot exchange rate at the date of the transaction.
Upon disposal of a foreign operation, the difference in translation of the foreign currency financial
statements relating to the foreign operation is transferred from owners' equity to profit or loss in
the period of disposal.
（9）Financial instrument
The Company recognizes a financial asset, a financial liability or an equity instrument when it
becomes a party to a financial instrument contract.
83
Wafangdian Bearing Co., Ltd. 2023 annual report full text
1. Classification of financial instruments
Based on the Company's business model for managing financial assets and the contractual cash
flow characteristics of financial assets, financial assets are classified at initial recognition as
financial assets carried at amortized cost, financial assets at fair value through other
comprehensive income, and financial assets at fair value through profit or loss.
The Company classifies financial assets at amortized cost that are not designated as financial
assets at fair value through profit or loss if they both meet the following criteria:
- (a) The business model is to collect the contractual cash flows;
- The contractual cash flows are only payments of principal and interest based on the outstanding
principal amount.
The Company classifies financial assets as financial assets at fair value through other
comprehensive income (debt instruments) that are not designated as at fair value through profit or
loss if they also meet the following criteria:
- Operating model with the objective of both collecting the contractual cash flows and selling the
financial asset;
- The contractual cash flows are only payments on the principal and interest based on the
outstanding principal amount.
For investments in non-trading equity instruments, the Company may irrevocably designate them
at initial recognition as financial assets at fair value through other comprehensive income (equity
instruments). This designation is made on an individual investment basis and the related
investment meets the definition of an equity instrument from the perspective of the issuer.
Except for the above-mentioned financial assets measured at amortized cost and financial assets at
fair value through other comprehensive income, the Company classifies all remaining financial
assets as financial assets at fair value through profit or loss. On initial recognition, the Company
may irrevocably designate financial assets that would otherwise be classified as financial assets at
amortized cost or at fair value through other comprehensive income as financial assets at fair
value through profit or loss if it can eliminate or significantly reduce the accounting mismatch.
Financial liabilities are classified at initial recognition as financial liabilities at fair value through
profit or loss and financial liabilities at amortized cost.
A financial liability may be designated as a financial liability at fair value through profit or loss at
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initial measurement if one of the following conditions is met:
(1) The designation eliminates or significantly reduces an accounting mismatch.
2) The management and performance evaluation of a portfolio of financial liabilities or a portfolio
of financial assets and financial liabilities is performed on a fair value basis in accordance with the
enterprise's risk management or investment strategy as set out in formal written documentation
and reported to key management personnel on this basis within the enterprise.
(3) The financial liability contains embedded derivatives that are subject to separate splitting.
2. Recognition basis and measurement method of financial instruments
(1) Financial assets measured at amortized cost
Financial assets measured at amortized cost, including notes receivable, accounts receivable, other
receivables, long-term receivables and debt investments, are initially measured at fair value, with
related transaction costs included in the initial recognition amount; accounts receivable that do not
contain significant financing components and those that the Company has decided not to consider
financing components that do not exceed one year are initially measured at contractual transaction
prices.
Interest calculated using the effective interest rate method during the holding period is recognized
in profit or loss.
On recovery or disposal, the difference between the acquisition price and the carrying amount of
the financial asset is recognized in profit or loss for the current period.
(2) Financial assets at fair value through other comprehensive income (debt instruments)
Financial assets (debt instruments) at fair value through other comprehensive income include
receivables financing and other debt investments, which are initially measured at fair value, with
related transaction costs recognized in the initial recognition amount. The financial assets are
subsequently measured at fair value, and changes in fair value are recognized in other
comprehensive income, except for interest, impairment loss or gain and exchange gain or loss
calculated using the effective interest rate method.
Upon derecognition, the cumulative gain or loss previously recognized in other comprehensive
income is transferred from other comprehensive income and recognized in profit or loss for the
current period.
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(3) Financial assets at fair value through other comprehensive income (equity instruments)
Financial assets (equity instruments) at fair value through other comprehensive income, including
investments in other equity instruments, are initially measured at fair value, with related
transaction costs recognized in the initial recognition amount. The financial assets are
subsequently measured at fair value, with changes in fair value recognized in other comprehensive
income. Dividends received are recognized in current profit or loss.
Upon derecognition, the cumulative gain or loss previously recognized in other comprehensive
income is transferred from other comprehensive income and recognized in retained earnings.
(4) Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for trading,
derivative financial assets and other non-current financial assets, which are initially measured at
fair value, with related transaction costs recognized in profit or loss. The financial assets are
subsequently measured at fair value, with changes in fair value recognized in profit or loss for the
period.
(5) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading
and derivative financial liabilities, which are initially measured at fair value, with related
transaction costs recognized in profit or loss. The financial liabilities are subsequently measured at
fair value, with changes in fair value recognized in profit or loss for the period.
Upon derecognition, the difference between the carrying amount and the consideration paid is
recognized in profit or loss for the current period.
(6) Financial liabilities measured at amortized cost
Financial liabilities measured at amortized cost include short-term borrowings, notes payable,
accounts payable, other payables, long-term borrowings, bonds payable and long-term payables,
which are initially measured at fair value, with related transaction costs included in the initial
recognition amount.
Interest calculated using the effective interest rate method during the holding period is recognized
in profit or loss.
Upon derecognition, the difference between the consideration paid and the carrying amount of the
financial liability is recognized in profit or loss for the current period.
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3. Basis of recognition and measurement of financial asset derecognition and financial asset
transfers
The Company derecognizes a financial asset when one of the following conditions is met:
- The contractual rights to receive cash flows from the financial asset are terminated;
- The financial asset has been transferred and substantially all the risks and rewards of ownership
of the financial asset have been transferred to the transferring party;
- A financial asset has been transferred and control over the financial asset is not retained,
although the Company neither transfers nor retains substantially all the risks and rewards of
ownership of the financial asset.
When the Company modifies or renegotiates a contract with a counterparty and the modification
constitutes a material change, the original financial asset is derecognized and a new financial asset
is recognized in accordance with the modified terms.
A financial asset is not derecognized if substantially all the risks and rewards of ownership of the
financial asset are retained when a transfer of the financial asset occurs.
In determining whether a transfer of financial assets meets the above conditions for derecognition
of financial assets, the principle of substance over form is applied.
The Company distinguishes between transfers of financial assets as a whole and partial transfers
of financial assets. If the transfer of a financial asset as a whole meets the derecognition condition,
the difference between the following two amounts is recognized in profit or loss for the current
period:
(1) The carrying amount of the financial asset transferred;
(2) The sum of the consideration received for the transfer and the cumulative amount of changes
in fair value previously recognized directly in owners' equity (in the case where the transferred
financial asset is a financial asset (debt instrument) measured at fair value through other
comprehensive income).
If a partial transfer of a financial asset satisfies the derecognition condition, the carrying amount
of the financial asset transferred as a whole is apportioned between the derecognized portion and
the unrecognized portion according to their respective relative fair values, and the difference
between the following two amounts is recognized in profit or loss:
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(1) The carrying amount of the derecognized portion;
(2) The sum of the consideration for the derecognized portion and the amount corresponding to
the derecognized portion of the cumulative amount of changes in fair value previously recognized
directly in owners' equity (in the case where the financial asset involved in the transfer is a
financial asset (debt instrument) measured at fair value through other comprehensive income).
If the transfer of a financial asset does not meet the derecognition condition, the financial asset
continues to be recognized and the consideration received is recognized as a financial liability.
4. Derecognition of financial liabilities
A financial liability or a portion thereof is derecognized when the present obligation of the
financial liability is discharged in whole or in part. If the Company enters into an agreement with
a creditor to replace an existing financial liability by assuming a new financial liability, and the
contractual terms of the new financial liability are materially different from those of the existing
financial liability, the existing financial liability is derecognized and a new financial liability is
recognized at the same time.
If all or part of the contractual terms of an existing financial liability are substantially modified,
the existing financial liability or part of it is derecognized, and the modified financial liability is
recognized as a new financial liability at the same time.
When a financial liability is derecognized in whole or in part, the difference between the carrying
amount of the derecognized financial liability and the consideration paid (including non-cash
assets transferred or new financial liabilities assumed) is recognized in profit or loss for the period.
If the Company repurchases a portion of a financial liability, the carrying amount of the financial
liability as a whole is allocated on the repurchase date based on the relative fair values of the
portion that continues to be recognized and the portion that is derecognized. The difference
between the carrying amount allocated to the derecognized portion and the consideration paid
(including non-cash assets transferred or new financial liabilities assumed) is recognized in profit
or loss for the period.
5. Methods to determine the fair value of financial assets and financial liabilities
The fair value of financial instruments for which there is an active market is determined by quoted
prices in an active market. The fair value of financial instruments for which no active market
exists is determined using valuation techniques. In valuation, the Company uses valuation
techniques that are applicable in the current circumstances and supported by sufficient available
data and other information, selects inputs that are consistent with the characteristics of the asset or
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liability considered by market participants in transactions for the relevant asset or liability, and
gives preference to the use of relevant observable inputs. Unobservable inputs are used only if the
relevant observable inputs are not available or not practicable to obtain.
6. Methods of testing and accounting for impairment of financial instrument
The Company estimates the expected credit losses on financial assets measured at amortized cost,
financial assets at fair value through other comprehensive income (debt instruments) and financial
guarantee contracts, etc.
The Company recognizes expected credit losses by calculating the probability-weighted amount
of the present value of the difference between the cash flows receivable under the contract and the
cash flows expected to be received, taking into account reasonable and substantiated information
about past events, current conditions and forecasts of future economic conditions, weighted by the
risk of default.
For receivables and contract assets resulting from transactions governed by ASBE No. 14,
Revenue, the Company always measures its allowance for losses at an amount equal to the
expected credit losses over the entire duration, regardless of whether or not there is a significant
financing component.
For lease receivables resulting from transactions regulated by ASBE No. 21, "Leases," the
Company has elected to always measure its allowance for losses at an amount equal to the
expected credit losses over the entire duration.
For other financial instruments, the Company assesses at each balance sheet date the change in
credit risk of the related financial instruments since initial recognition.
The Company assesses whether the credit risk of a financial instrument has increased significantly
since initial recognition by comparing the risk of default of the financial instrument at the balance
sheet date with the risk of default at the date of initial recognition to determine the relative change
in the risk of default over the expected life of the financial instrument. The Company generally
considers that the credit risk of a financial instrument has increased significantly if it is more than
30 days past due, unless there is conclusive evidence that the credit risk of the financial instrument
has not increased significantly since initial recognition.
If the credit risk of a financial instrument is low at the balance sheet date, the Company considers
that the credit risk of the financial instrument has not increased significantly since initial
recognition.
If the credit risk of a financial instrument has increased significantly since initial recognition, the
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Company measures the allowance for losses at an amount equal to the expected credit losses over
the entire life of the financial instrument; if the credit risk of a financial instrument has not
increased significantly since initial recognition, the Company measures the allowance for losses at
an amount equal to the expected credit losses of the financial instrument in the next 12 months.
The resulting increase or reversal amount of the loss allowance is recognized as an impairment
loss or gain in profit or loss. For financial assets (debt instruments) that are measured at fair value
through other comprehensive income, the allowance for losses is recognized in other
comprehensive income and the impairment loss or gain is recognized in profit or loss for the
current period and does not reduce the carrying amount of the financial asset as stated in the
balance sheet.
If there is objective evidence that a accounts receivable is credit impaired, the Company provides
for impairment of that accounts receivable on a stand-alone basis.
For receivables and contract assets resulting from transactions governed by ASBE No. 14 -
Revenue (2017), the Company consistently measures its allowance for losses at an amount equal
to the expected credit loss over the entire life of the asset, regardless of whether it contains a
significant financing component.
For lease receivables, the Company has elected to always measure the allowance for losses at an
amount equal to the expected credit loss over the entire life of the receivables.
In addition to certain financial assets that are assessed for past due credit losses on an individual
basis, the Group also assesses expected credit losses on financial assets measured at amortized
cost on the basis of an aging portfolio.
In addition to the above receivables that are individually provided for bad debts, the Company
classifies the remaining financial instruments into portfolios based on credit risk characteristics
and determines expected credit losses on a portfolio basis. The categories of portfolio and the
basis for determining expected credit losses for notes receivable, accounts receivable, accounts
receivable financing, and other receivables are described below:
Items Portfolio Type Basis of determination
Expected credit losses are
calculated by referring to historical
credit loss experience and preparing
a table of accounts receivable aging
Receivable 1 Ageing portfolio against the expected credit loss rate
over the entire life of the accounts
receivable, taking into account
current conditions and forecasts of
future economic conditions.
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Provision for bad debts is not made
in principle, unless there is clear
Receivable 2 Related party portfolio
evidence of a genuine impossibility
of recovery in whole or in part
Note receivable 1 Bank acceptance
Note receivable 2 Trade acceptance
Note receivable 3 Finance company acceptance
Financing receivable Bank acceptance
Provision for bad debts is not made
in principle, unless there is clear
Other receivable 1 Related party portfolio
evidence of a genuine impossibility
of recovery in whole or in part
Other receivable 2 Aging portfolio Expected credit losses are
calculated by reference to historical
credit loss experience, taking into
Risk free portfolio (according to account current conditions as well
couterparty ’ s credit, nature of the as forecasts of future economic
Other receivable 3
payment and transactions secure conditions through default
facility) exposures and expected credit loss
rates over the entire duration.
If the Company no longer has a reasonable expectation that the contractual cash flows from a
financial asset will be fully or partially recovered, the carrying amount of the financial asset is
written down directly.
(10) Inventory
1.Category and cost of inventory
Inventories are classified as: raw materials, packaging, low-value consumables, work in process,
and finished goods.
Inventory is initially measured at cost, and the cost of inventory includes the cost of purchase,
processing costs and other expenses incurred in bringing the inventory to its current location and
condition.
2.Valuation method of issued inventory
Inventories are valued on a real-time moving weighted-average basis when they are issued.
3. inventory system
Adoption of perpetual inventory system
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4.Amortization method of low-value consumables and packaging
(1) Low-value consumables are amortized using the one-time reversal method;
(2) The one-time reversal method is used for packaging.
5. Recognition criteria and accrual method for provision for decline in value of inventories
At the balance sheet date, inventories should be measured at the lower of cost or net realizable
value. When the cost of inventories is higher than their net realizable value, a provision for the
impairment of inventory should be made. Net realizable value is the estimated selling price of
inventories in the ordinary course of activities, less the estimated costs to be incurred to
completion, estimated selling expenses and related taxes.
The net realizable value of finished goods, inventory and materials for sale, which are directly
used for sale, is determined in the normal course of production and operation as the estimated
selling price of the inventory, less estimated selling expenses and related taxes; the net realizable
value of materials subject to processing is determined in the normal course of production and
operation as the estimated selling price of the finished goods produced, less estimated costs to be
incurred to completion, estimated selling expenses and related taxes, The net realizable value of
inventories held for the execution of sales contracts or labor contracts is calculated on the basis of
the contract price, and if the quantity of inventories held exceeds the quantity ordered in the sales
contract, the net realizable value of the excess inventories is calculated on the basis of the general
sales price.
After the provision for the impairment of inventory, if the factors affecting the previous write-
down of inventory value have disappeared, resulting in the net realizable value of inventory higher
than its book value, the amount of the provision for the impairment of inventory is reversed
within the original provision, and the reversed amount is included in the current profit and loss.
(11) Contract assets
1. Methods and criteria for recognition of contract assets
The Company presents contract assets or contract liabilities in the balance sheet based on the
relationship between the performance obligations and payments from customers. The right to
receive consideration for goods transferred or services provided by the Company to the customer
(and which is dependent on factors other than the passage of time) is presented as a contract asset.
Contract assets and contract liabilities under the same contract are shown on a net basis. The
Company's unconditional (depending only on the passage of time) right to receive consideration
from customers is shown separately as receivables.
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2. Method of determining expected credit losses on contract assets and accounting treatment
The methods of determining expected credit losses on contract assets and the accounting
treatment are described in detail in Note "(ix) 6. Methods of testing and accounting treatment for
impairment of Financial instrument" in this Note.
(12) Long-term equity investments
1. Criteria for determining joint control and significant influence
Joint control refers to the control shared by an arrangement in accordance with the relevant
agreement, and the relevant activities of the arrangement can only be decided with the unanimous
consent of the participants sharing the control. If the Company exercises joint control over an
investee together with other joint venture parties and has rights to the investee's net assets, the
investee is a joint venture of the Company.
Significant influence means having the power to participate in the financial and operating
decisions of the investee, but not being able to control or exercise joint control with other parties
over the formulation of those policies. Where the Company is able to exercise significant
influence over an investee, the investee is an associate of the Company.
2. Determination of initial investment
(1) Long-term equity investments resulting from business combinations
For long-term equity investments in subsidiaries formed by business combinations under common
control, the initial investment of long-term equity investments is determined at the date of
consolidation based on the acquisition of the share of the ownership interest of the consolidated
party in the book value of the consolidated financial statements of the ultimate controlling party.
The difference between the initial investment cost of the long-term equity investment and the
carrying value of the consideration paid is adjusted against the equity premium in capital surplus;
if the equity premium in capital surplus is not sufficient for elimination, retained earnings are
adjusted. If the Company is able to exercise control over an investee under the same control due to
additional investment, the difference between the initial investment cost of the long-term equity
investment recognized in accordance with the above principle and the sum of the book value of
the long-term equity investment before reaching the consolidation plus the book value of the
consideration paid for further acquisition of shares at the date of consolidation is adjusted against
equity premium, and if the equity premium is not sufficient for elimination, it is reduced against
retained earnings.
For long-term equity investments in subsidiaries formed through business combinations not under
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common control, the initial investment cost of the long-term equity investment is based on the
cost of the combination determined at the date of acquisition. If it is possible to exercise control
over the investee under non-same control due to additional investment, the sum of the book value
of the equity investment originally held plus the cost of the additional investment is used as the
initial investment cost.
(2) Long-term equity investments acquired through other means instead of business combination
Long-term equity investments acquired by cash payment are recorded at initial investment cost
based on the actual purchase price paid.
Long-term equity investments acquired by issuing equity securities are recorded at the initial
investment cost based on the fair value of the equity securities issued.
3. Subsequent measurement and profit or loss recognition methods
(1) Long-term equity investments accounted for under the cost method
The Company accounts for its long-term equity investments in subsidiaries using the cost method
unless the investments meet the conditions of being held for sale. Except for the declared but
unpaid cash dividends or profits included in the actual price or consideration paid for the
investment, the Company recognizes investment income for the current period based on the
Company's entitlement to the declared cash dividends or profits of the investee.
(2) Long-term equity investments accounted for under the equity method
Long-term equity investments in associates and joint ventures are accounted for using the equity
method. The difference between the initial investment cost and the share of the fair value of the
identifiable net assets of the investee at the time of investment is not adjusted to the initial
investment cost of the long-term equity investment; the difference between the initial investment
cost and the share of the fair value of the identifiable net assets of the investee at the time of
investment is recognized in profit or loss for the current period and the cost of the long-term
equity investment is also adjusted.
The Company recognizes investment income and other comprehensive income according to the
share of net profit or loss and other comprehensive income realized by the investee, respectively,
and adjusts the carrying value of the long-term equity investment at the same time; the portion to
which the Company is entitled according to the profit or cash dividends declared by the investee is
calculated, and the carrying value of the long-term equity investment is reduced accordingly; for
the investee's ownership interest other than net profit or loss, other comprehensive income and
profit distribution For changes in the equity of the investee other than net profit or loss, other
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comprehensive income and profit distribution ("changes in other owners' equity"), the carrying
amount of the long-term equity investment is adjusted and recognized in owners' equity.
In recognizing the share of the investee's net profit or loss, other comprehensive income and other
changes in owners' equity, the fair value of the investee's identifiable net assets at the time of
acquisition is used as the basis for recognition, and the net profit and other comprehensive income
of the investee are adjusted in accordance with the Company's accounting policies and accounting
periods.
Unrealized gains or losses on internal transactions between the company and associate and joint
ventures that are attributable to the Company on the basis of their proportionate share are offset
and investment income is recognized on this basis, except when the assets invested or sold
constitute a business. Unrealized losses on internal transactions with investees are recognized in
full if there are impairment losses on assets.
The net loss incurred by the company in a joint venture or an associate, except for the obligation
to assume additional losses, is limited to a write-down to zero of the carrying amount of the long-
term equity investment and other long-term interests that substantially constitute the net
investment in the joint venture or associate. If the joint venture or associate subsequently realizes
net profit, the Company resumes recognition of revenue sharing after the revenue sharing amount
makes up for the unrecognized loss sharing amount.
(3) Disposal of long-term equity investments
The difference between the carrying amount and the actual acquisition price of a long-term equity
investment is recognized in profit or loss for the current period.
If a long-term equity investment accounted for under the equity method is partially disposed of
and the remaining equity interest is still accounted for under the equity method, the other
comprehensive income recognized under the former equity method is carried forward in
proportion to the corresponding percentage using the same basis as the direct disposal of the
related assets or liabilities by the investee, and other changes in owners' equity are carried forward
in proportion to the current profit or loss.
If the common control or significant influence over the investee is lost due to the disposal of
equity investments, etc., other comprehensive income recognized as a result of the adoption of the
equity method of accounting for the original equity investment is accounted for on the same basis
as the direct disposal of the related assets or liabilities of the investee upon the termination of the
adoption of the equity method of accounting, and all changes in other owners' equity are
transferred to current profit or loss upon the termination of the adoption of the equity method of
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accounting.
If control over the investee is lost due to disposal of part of the equity investment, the remaining
equity interest that can exercise joint control or significant influence over the investee is
accounted for under the equity method in the preparation of individual financial statements, and
the remaining equity interest is adjusted as if it had been accounted for under the equity method
from the time of acquisition, and other comprehensive income recognized prior to the acquisition
of control over the investee is accounted for on the same basis as if the investee had directly
disposed of the related assets or liabilities. If the remaining equity interest cannot exercise joint
control or significant influence over the investee, it is recognized as a financial asset, and the
difference between its fair value and its carrying amount at the date of loss of control is
recognized in profit or loss for the current period, and for other comprehensive income and other
owner's equity recognized prior to the acquisition of control of the investee, the remaining equity
interest is recognized in profit or loss for the current period. All other comprehensive income and
other changes in owners' equity recognized prior to the acquisition of control of the investee are
carried forward.
If the disposal of an equity investment in a subsidiary through multiple transactions until the loss
of control is a package transaction, each transaction is accounted for as a disposal of an equity
investment in a subsidiary and the loss of control; the difference between the disposal price and
the carrying value of the long-term equity investment corresponding to the equity interest
disposed of before the loss of control is recognized as other comprehensive income in the
individual financial statements, and then recognized as other comprehensive income when control
is lost. The difference between the disposal price and the carrying amount of the long-term equity
investment before the loss of control is recognized as other comprehensive income in the
individual financial statements, and then transferred to profit or loss in the period in which control
is lost. If it is not a package transaction, each transaction is accounted for separately.
(13) Investment properties
Investment properties are real estate held to earn rentals or for capital appreciation, or both, and
include land use rights that have been leased out, land use rights that are held and intended to be
transferred after appreciation, and buildings that have been leased out (including buildings that are
used for leasing after completion of self-construction or development activities and buildings that
are under construction or development that will be used for leasing in the future).
Subsequent expenditures related to investment properties are included in the cost of investment
properties when the inflow of related economic benefits is probable and their costs can be
measured reliably; otherwise, they are recognized in current profit or loss when incurred.
The Company uses the cost model to measure existing investment properties. The same
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depreciation policy as that for the Company's fixed assets is applied to investment properties -
buildings for lease that are measured under the cost model, and land use rights for lease are
subject to the same amortization policy as that for intangible assets.
(14) Fixed assets
1. Recognition and initial measurement of fixed assets
Fixed assets are tangible assets held for the production of goods, provision of services, rental or
management, and with a useful life of more than one fiscal year and a unit value of more than
CNY2,000. A fixed asset is recognized when both of the following conditions are met:
(1) It is probable that the economic benefits associated with the fixed asset will flow to the
enterprise;
(2) The cost of the fixed asset can be measured reliably.
Fixed assets are initially measured at cost (taking into account the effect of expected disposal
costs).
Subsequent expenditures related to fixed assets are included in the cost of fixed assets when it is
probable that the economic benefits associated with them will flow to the enterprise and their cost
can be measured reliably; for the replaced part, the carrying amount is derecognized; all other
subsequent expenditures are charged to current profit or loss when incurred.
2.Depreciation Method
Depreciation of fixed assets is provided using the average annual method, and the depreciation
rate is determined based on the category of fixed assets, estimated useful life and estimated net
residual value rate. For fixed assets with provision for impairment, the depreciation amount is
determined in future periods based on the carrying amount after deducting the provision for
impairment and based on the remaining useful life. If each component of fixed assets has different
useful lives or provides economic benefits to the enterprise in different ways, different
depreciation rates or depreciation methods are selected and depreciated separately.
The depreciation methods, useful lifes, residual value rate and annual depreciation rates of various
types of fixed assets are as follows:
Annual
Estimated net residual
Category Useful life (years) depreciation
value rate (%)
rate (%)
Housing and Buildings
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Including: Houses, factories, cubicles,
30 3 3.23
pipelines, roads
Waste storage 20 3 4.85
Machinery equipment 10 3 9.7
Transportation equipment 5 3 19.4
Electronic equipment
Including: Computer 5 3 19.4
Instrumentation 10 3 9.7
Others equipment
Including：Transmission equipment 10 3 9.7
Specialized equipment 10 3 9.7
Office equipment 5 3 19.4
Other Ffixed assets 5 3 19.4
3. Disposal of fixed assets
Fixed assets are derecognized when they are disposed of, or when no economic benefits are
expected to arise from their use or disposal. The disposal proceeds from the sale, transfer,
scrapping or destruction of fixed assets, net of their book value and related taxes and fees, are
recognized in profit or loss for the current period.
(15) Construction in progress
Construction in progress is measured at the actual cost incurred. Actual costs include construction
costs, installation costs, borrowing costs eligible for capitalization and other necessary
expenditures incurred to bring the construction in progress to its intended useable condition.
Construction in progress is transferred to fixed assets and depreciated from the following month
when it reaches its intended useable state.
(16) Intangible assets
1.Valuation method of intangible assets
(1) The company initially measures intangible assets at cost when they are acquired;
The cost of an externally acquired intangible asset includes the purchase price, related taxes and
other expenses directly attributable to bringing the asset to its intended use.
(2)Subsequent measurement
The useful life of an intangible asset is analyzed and determined at the time of acquisition.
For intangible assets with finite useful lives, they are amortized over the period in which they
bring economic benefits to the enterprise; if the period in which the intangible assets bring
economic benefits to the enterprise cannot be foreseen, they are considered to be intangible assets
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with indefinite useful lives and are not amortized.
2.Estimation of useful lives of intangible assets with finite useful lives
For intangible assets with finite useful lives, they are amortized over the period that they will
bring economic benefits to the enterprise; if it is not possible to foresee the period that the
intangible assets will bring economic benefits to the enterprise, they are regarded as intangible
assets with indefinite useful lives and are not amortized.
Land use rights are amortized equally over their useful lives from the date of grant; ERP software
and other intangible assets are amortized equally over the shortest of their estimated useful lives,
contractual beneficial lives and effective lives as prescribed by law. The amortization amount is
charged to the cost of the related assets and to current profit or loss according to the target
beneficiary. The estimated useful lives and amortization methods for intangible assets with finite
useful lives are reviewed at the end of each year, and any changes are treated as changes in
accounting estimates.
3.Scope of Research and Development Expenditures
The Company's expenses incurred in the process of conducting research and development include
related staff salaries, materials consumed, related depreciation and amortization expenses and
other related expenses of the personnel engaged in research and development activities, and are
summarized as follows:
The relevant employee compensation of the personnel engaged in R&D activities mainly refers to
the relevant employee compensation of the personnel directly engaged in R&D activities, the
management personnel closely related to R&D activities and the direct service personnel.
Depreciation expense refers to the expense of depreciation of instruments, equipment and
buildings in use for research and development activities. Long-term deferred expenses refer to
long-term deferred expenses incurred in the course of alteration, modification, renovation and
repair of research and development facilities.
Direct input expense refers to the related expenditure actually incurred by enterprises for the
implementation of research and development activities. Including direct consumption of materials,
fuel and power costs; Expenses for the operation, maintenance, adjustment, inspection, inspection
and repair of instruments and equipment used in research and development activities, as well as
lease fees for fixed assets rented through business leasing for research and development activities.
4.Specific criteria for classifying research and development phases
Expenditures on in-house research and development projects are categorized into research stage
expenditures and development stage expenditures.
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Research stage: the stage of original and planned investigation and research activities for the
purpose of acquiring and understanding new scientific or technological knowledge.
Development phase: the stage of applying research results or other knowledge to a plan or design
to produce new or substantially improved materials, devices, products and other activities before
commercial production or use.
5.The specific conditions for capitalization of development stage expenditures
Expenditures in the research stage are recognized in profit or loss when they are incurred.
Expenditures in the development phase are recognized as intangible assets if the following
conditions are met. Expenditures in the development phase that do not meet the following
conditions are recognized in the current period's profit or loss:
(1) It is technically feasible to complete the intangible asset so that it can be used or sold;
(2) There is an intention to complete the intangible asset for use or sale;
(3) The manner in which the intangible asset will generate economic benefits, including the ability
to demonstrate the existence of a market for the products produced by applying the intangible
asset or the existence of a market for the intangible asset itself, and the usefulness of the
intangible asset if it will be used internally;
(4) The availability of sufficient technical, financial and other resources to support the completion
of the development of the intangible asset and the ability to use or sell the intangible asset;
(5) Expenditures attributable to the development phase of the intangible asset can be measured
reliably.
If it is not possible to distinguish between research-phase expenditures and development-phase
expenditures, all research and development expenditures incurred are recognized in the current
period's profit or loss.
(17) Impairment of long term assets
Long-term equity investments, investment properties measured using the cost model, fixed assets,
construction in progress, right-of-use assets, intangible assets with finite useful lifes, oil and gas
assets and other long-term assets are tested for impairment if there is an indication of impairment
at the balance sheet date. 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 is made for the difference
and an impairment loss is recorded. The recoverable amount is the higher of the asset's fair value
less costs of disposal and the present value of estimated future cash flows of the asset. The
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provision for asset impairment is calculated and recognized on an individual asset basis. If it is
difficult to estimate the recoverable amount of an individual asset, the recoverable amount of the
asset group is determined using the asset group to which the asset belongs. An asset group is the
smallest combination of assets that can generate cash inflows independently.
For goodwill resulting from business combinations, intangible assets with indefinite useful lives,
and intangible assets that have not yet reached a serviceable status, impairment tests are
performed once a year at the end of each year, regardless of whether there is an indication of
impairment.
The Company conducts goodwill impairment tests and apportions the carrying value of goodwill
formed as a result of a business combination to the relevant asset group from the date of purchase
in accordance with a reasonable method; if it is difficult to apportion to the relevant asset group, it
is apportioned to the relevant asset group combination. A relevant asset group or a combination of
asset groups is an asset group or a combination of asset groups that can benefit from the
synergistic effect of a business combination.
When impairment test of the relevant asset group or combination of asset groups that contain
goodwill, if there is an indication of impairment of the asset group or combination of asset groups
related to goodwill, the asset group or combination of asset groups that do not contain goodwill is
first tested for impairment, the recoverable amount is calculated and compared with the relevant
carrying amount, and a corresponding impairment loss is recognized. If the recoverable amount is
less than the carrying amount, the impairment loss is first reduced by the carrying amount of
goodwill apportioned to the asset group or group of assets, and then reduced by the carrying
amount of each asset group or group of assets other than goodwill in proportion to its
proportionate share of the carrying amount of the other assets. The carrying value of each asset is
then reduced by the carrying value of each asset other than goodwill.
Once the above impairment loss is recognized, it will not be reversed in subsequent accounting
periods.
(18) Long-term amortization
Long-term amortization is an expense that has been incurred but should be borne by the current
and future periods and is apportioned over a period of more than one year. These costs are
amortized evenly over the period of benefit. If an item of long-term amortization does not benefit
subsequent accounting periods, the unamortized amortized value of the item is transferred to
current profit or loss.
(19) Contract liability
An entity’s obligation to transfer goods or services to a customer for which the entity has received
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consideration (or the amount is due) from the customer. Contract asset and contract liability
originate from same contact shall be listed at net amount.
(20) Employee compensation
1.Accounting for short-term compensation
The Company recognizes actual short-term compensation incurred by employees as a liability in
the accounting period in which the employees provide services to the Company, and recognizes it
in the current profit or loss or the cost of related assets.
The social insurance premiums and housing fund paid by the Company for its employees, as well
as the labor union funds and employee education funds withdrawn in accordance with regulations,
are used to determine the corresponding amount of employee compensation in accordance with
the prescribed accrual basis and accrual ratio during the accounting period in which the employees
provide services to the Company.
Employee benefit expenses incurred by the Company are charged to current profit or loss or the
cost of related assets based on the actual amount incurred when incurred, of which non-monetary
benefits are measured at fair value.
2.Accounting for post-employment benefits
(1) Defined contribution plan
The Company contributes to basic pension and unemployment insurance for employees in
accordance with the relevant local government regulations. During the accounting period in which
the employees provide services to the Company, the amount payable is calculated based on the
contribution base and ratio set by the local regulations, recognized as a liability, and charged to
current profit or loss or cost of related assets. In addition, the Company participates in an
enterprise annuity plan/supplemental pension fund approved by the relevant state authorities. The
Company contributes a certain percentage of the employees' total salaries to the annuity
plans/local social insurance agencies, and the corresponding expenses are recognized in the
current profit or loss or cost of related assets.
(2) Defined benefit plans
The Company attributes the benefit obligations arising from the defined benefit plans to the period
in which the employees render services in accordance with the formula determined by the
expected accumulated benefit unit method, and recognizes them in current profit or loss or cost of
related assets.
The deficit or surplus resulting from the present value of the defined benefit plan obligation less
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the fair value of the defined benefit plan assets is recognized as a net defined benefit plan liability
or net asset. If a defined benefit plan has a surplus, the Company measures the net defined benefit
plan asset at the lower of the surplus or asset limit of the defined benefit plan.
All defined benefit plan obligations, including those expected to be paid within twelve months
after the end of the annual reporting period in which employees render services, are discounted
based on market yields on treasury bonds or high-quality corporate bonds in active markets that
match the maturity and currency of the defined benefit plan obligations as of the balance sheet
date.
The service cost incurred by the defined benefit plan and the net interest on the net liabilities or
net assets of the defined benefit plan are recognized in profit or loss or the cost of the related
assets; changes resulting from the remeasurement of the net liabilities or net assets of the defined
benefit plan are recognized in other comprehensive income and are not reversed to profit or loss in
subsequent accounting periods, and the entire portion previously recognized in other
comprehensive income is carried forward to unrecognized earnings to the extent of equity upon
termination of the original defined benefit plan. The portion of other comprehensive income
within equity is transferred to unappropriated earnings upon termination of the defined benefit
plan.
Upon settlement of a defined benefit plan, a gain or loss on settlement is recognized as the
difference between the present value of the defined benefit plan obligation and the settlement
price determined at the settlement date.
3.Accounting for termination benefits
If the Company provides termination benefits to employees, it recognizes employee compensation
liabilities arising from termination benefits and recognizes them in profit or loss at the earlier of:
when the Company cannot unilaterally withdraw termination benefits provided as a result of a
termination plan or a proposed reduction in force; and when the Company recognizes costs or
expenses related to a restructuring involving the payment of termination benefits.
(21) Accrued liabilities
The Company recognizes an obligation related to a contingent event as an accrued liabilities when
the following conditions are simultaneously mets:
(1) The obligation is a present obligation assumed by the Company;
(2) It is probable that the performance of the obligation will result in an outflow of economic
benefits to the Company;
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(3) 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.
In determining the best estimate, the risks associated with the contingency, uncertainty and the
time value of money are considered. Where the effect of the time value of money is material, the
best estimate is determined by discounting the related future cash outflows.
Where a continuous range of expenditures required exists and it is equally probable that various
outcomes will occur within that range, the best estimate is determined at the mid-point of the
range; in other cases, the best estimate is treated separately as follows:
- Where the contingency relates to a single item, the best estimate is determined in accordance
with the most probable occurrence amount.
- If the contingency involves multiple items, it is determined on the basis of various possible
outcomes and related probabilities.
If all or part of the expenditure required to settle the estimated liability is expected to be
reimbursed by a third party, the amount of reimbursement is recognized separately as an asset
when it is substantially certain that it will be received, and the amount of reimbursement
recognized does not exceed the carrying amount of the estimated liability.
The Company reviews the carrying amount of the estimated liability at the balance sheet date, and
if there is conclusive evidence that the carrying amount does not reflect the current best estimate,
the carrying amount is adjusted in accordance with the current best estimate.
(22) Revenue
1.Accounting policies used for revenue recognition and measurement
The Company recognizes revenue when it has fulfilled its performance obligations under a
contract, i.e., when the customer obtains control of the relevant goods or services. The acquisition
of control of the relevant goods or services is defined as the ability to dominate the use of the
goods or services and derive substantially all of the economic benefits therefrom.
If a contract contains two or more performance obligations, the Company apportions the
transaction price to each individual performance obligation on the contract commencement date in
proportion to the relative share of the individual selling price of the goods or services promised by
each individual performance obligation. The Company measures revenue based on the transaction
price apportioned to each individual performance obligation.
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The transaction price is the amount of consideration to which the Company expects to be entitled
as a result of the transfer of goods or services to the customer, excluding amounts collected on
behalf of third parties and amounts expected to be refunded to the customer. The Company
determines the transaction price in accordance with the terms of the contract, taking into account
its past customary practices, and considers the impact of variable consideration, the existence of
significant financing components in the contract, non-cash consideration, and consideration
payable to the customer in determining the transaction price. The Company determines the
transaction price that includes variable consideration by an amount that does not exceed the
amount for which it is highly probable that there will be no material reversal of the cumulative
recognized revenue at the time the relevant uncertainty is removed. If there is a significant
financing component in the contract, the Company determines the transaction price based on the
amount payable in cash assuming that the customer will pay for the goods or services as soon as
control is obtained, and amortizes the difference between this transaction price and the contract
consideration using the effective interest rate method over the term of the contract. Performance
obligations are fulfilled within a certain period of time if one of the following conditions is met,
otherwise, performance obligations are fulfilled at a certain point in time:
- The customer obtains and consumes the economic benefits resulting from the Company's
performance at the same time as the Company's performance.
- The customer is able to control the goods under construction in the course of the Company's
performance.
- The goods produced in the course of the Company's performance have irreplaceable use and the
Company is entitled to receive payment for the portion of the performance that has been
completed to date in the aggregate throughout the term of the contract.
For performance obligations performed within a certain period of time, the Company recognizes
revenue in accordance with the progress of performance during that period, except when the
progress of performance cannot be reasonably determined. The Company uses the output method
or input method to determine the progress of performance, taking into account the nature of the
goods or services. When the progress of performance cannot be reasonably determined, the
Company recognizes revenue in the amount of costs already incurred until the progress of
performance can be reasonably determined, if the costs already incurred are expected to be
reimbursed.
For performance obligations performed at a point in time, the Company recognizes revenue at the
point in time when the customer obtains control of the related goods or services. In determining
whether the customer has acquired control of the goods or services, the Company considers the
following indications:
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- The Company has a present right to receive payment for the goods or services, i.e., the customer
has a present obligation to pay for the goods or services.
- The Company has transferred legal title to the goods to the customer, i.e., the customer has legal
title to the goods.
- The Company has transferred physical possession of the goods to the customer, i.e. the customer
has taken physical possession of the goods.
- The Company has transferred the principal risks and rewards of ownership of the goods to the
customer, i.e., the customer has acquired the principal risks and rewards of ownership of the
goods.
- The customer has accepted the goods or services, etc.
The Company determines whether its status is that of a principally liable person or an agent at the
time of engaging in a transaction based on whether it has control over the goods or services prior
to transferring them to the customer. If the Company is able to control the goods or services prior
to transferring them to the customer, the Company is the principal and recognizes revenue based
on the total consideration received or receivable; otherwise, the Company is the agent and
recognizes revenue based on the amount of commissions or fees it expects to be entitled to receive.
2.Disclosure of specific revenue recognition and measurement methods by business type
Revenue from the sale of goods: The Group recognizes revenue from the sale of goods when the
major risks and rewards of ownership of the goods have been transferred to the purchaser, the
Group has neither retained the right of continued management normally associated with
ownership nor exercised effective control over the goods sold, the amount of revenue can be
measured reliably, it is probable that the related economic benefits will flow to the enterprise, and
the related costs incurred or to be incurred can be measured reliably. Revenue from the sale of
goods is realized.
Revenue from the transfer of assets: Revenue from the transfer of the right to use assets is
recognized when it is probable that the economic benefits associated with the transaction will flow
to the Group and the amount of revenue can be measured reliably.
(23) Contract Costs
Contract costs include contract performance costs and contract acquisition costs.
Costs incurred by the Company to perform a contract that are not regulated by the relevant
standards, such as inventories, fixed assets or intangible assets, are recognized as contract
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performance costs as an asset when the following conditions are met:
- The cost is directly related to a contract that is currently or expected to be acquired.
- The cost increases the Company's resources available to meet future performance obligations.
- The cost is expected to be recovered.
Incremental costs incurred by the Company to acquire a contract that are expected to be recovered
are recognized as a contract acquisition cost as an asset.
Assets related to contract costs are amortized using the same basis as revenue recognition for the
goods or services to which the asset relates; however, for contract acquisition costs that are
amortized over a period of less than one year, the Company recognizes them in profit or loss as
incurred. If the carrying value of an asset related to the contract cost is higher than the difference
between the following two items, the Company provides for impairment of the excess and
recognizes an impairment loss on the asset:
1. the remaining consideration expected to be received for the transfer of the goods or services
related to the asset
2. the estimated costs to be incurred for the transfer of such related goods or services.
If there is a subsequent change in the factors impaired in prior periods that causes the
aforementioned difference to be higher than the carrying amount of the asset, the Company
reverses the original provision for impairment and recognizes it in profit or loss, provided that the
carrying amount of the asset after the reversal does not exceed the carrying amount of the asset at
the date of reversal assuming no provision for impairment was made.
(24) Government grants
1. Types
Government grants, which are monetary or non-monetary assets acquired by the Company from
the government without compensation, are classified as asset-related government grants and
revenue-related government grants.
Government grants related to assets are obtained by the Company for the acquisition and
construction or otherwise forming long-term assets. Revenue-related government grants refer to
government grants other than asset-related government grants.
The specific criteria for the Company to classify government grants as asset-related are:
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government grants obtained by the Group and used for the acquisition and construction or
otherwise forming long-term assets
The Company's specific criteria for classifying government grants as revenue-related are:
government grants other than those related to assets
For those government grants for which the government documents do not specify the objects of
the grants, the Company classifies the government grants as asset-related or revenue-related based
on the following judgment: the Group makes judgment in accordance with the above-mentioned
principles of differentiation, and if it is difficult to differentiate, the whole is classified as revenue-
related government grants.
2. Recognition point
Government grants are recognized when the Company is able to meet the conditions attached to
them and when they can be received.
3、Accounting treatment
Government grants related to assets are reduced to the carrying amount of the relevant assets or
recognized as deferred income. If recognized as deferred income, it is recognized in profit or loss
in accordance with a reasonable and systematic method in installments over the useful life of the
relevant assets (if it is related to the Company's daily activities, it is recognized in other income; if
it is not related to the Company's daily activities, it is recognized in non-operating income);
Government grants related to revenue, which are used to compensate the Company for relevant
costs and expenses or losses in subsequent periods, are recognized as deferred revenue and
charged to current profit or loss (to other income if they are related to the Company's ordinary
activities; to non-operating income if they are not related to the Company's ordinary activities) or
offset against relevant costs and expenses or losses in the period in which the relevant costs and
expenses or losses are recognized; to compensate the Company for If it is used to compensate the
Company for the related costs or losses incurred, it is directly recognized in profit or loss (other
income if it is related to the Company's daily activities; non-operating income if it is not related to
the Company's daily activities) or reduced by the related costs or losses.
(25) Deferred income tax assets and deferred income tax liabilities
Income taxes consist of current income taxes and deferred income taxes. The Company
recognizes current income tax and deferred income tax in profit or loss, except for income tax
arising from business combinations and transactions or events directly recognized in owners'
equity (including other comprehensive income).
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Deferred income tax assets and deferred income tax liabilities are recognized based on the
difference between the tax basis of assets and liabilities and their carrying amounts (temporary
differences).
Deferred tax assets are recognized for deductible temporary differences to the extent that it is
probable that taxable income will be available in future periods against which the deductible
temporary differences can be utilized. For deductible losses and tax credits that can be carried
forward to future years, deferred tax assets are recognized to the extent that it is probable that
future taxable income will be available against which the deductible losses and tax credits can be
utilized.
Deferred income tax liabilities are recognized for taxable temporary differences, except under
special circumstances.
The special circumstances under which deferred tax assets or deferred tax liabilities are not
recognized include
- Initial recognition of goodwill;
- Transactions or events that are neither business combinations nor, at the time of their occurrence,
affect accounting profit and taxable income (or deductible losses), and for which the initial
recognition of assets and liabilities does not result in taxable temporary differences and deductible
temporary differences of an equivalent amount.
Deferred income tax liabilities are recognized for taxable temporary differences associated with
investments in subsidiaries, associates and joint ventures, unless the Company is able to control
the timing of the reversal of the temporary difference and it is probable that the temporary
difference will not reverse in the foreseeable future. Deferred income tax assets are recognized for
deductible temporary differences associated with investments in subsidiaries, associates and joint
ventures when it is probable that the temporary differences will reverse in the foreseeable future
and it is probable that future taxable income will be available against which the deductible
temporary differences can be utilized.
At the balance sheet date, deferred income tax assets and deferred income tax liabilities are
measured at the tax rates applicable to the periods when the related assets are expected to be
recovered or the related liabilities settled, in accordance with the tax laws.
At the balance sheet date, the Company reviews the carrying amount of deferred tax assets. The
carrying amount of deferred tax assets is written down if it is more likely than not that sufficient
taxable income will not be available in future periods to offset the benefit of the deferred tax
assets. To the extent that it is probable that sufficient taxable income will be available, the written
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down amount is reversed.
When there is a legal right to settle on a net basis and the intention is to settle on a net basis or to
acquire assets and settle liabilities simultaneously, current income tax assets and current income
tax liabilities are stated at the net amount after offsetting.
At the balance sheet date, deferred income tax assets and deferred income tax liabilities are
presented on a net basis after offsetting when both of the following conditions are met:
- The taxable entity has the legal right to settle current income tax assets and current income tax
liabilities on a net basis;
- Deferred income tax assets and deferred income tax liabilities relate to income taxes levied by
the same tax authority on the same taxable entity or to different taxable entities, but in each future
period in which it is significant that the deferred income tax assets and liabilities reverse, the
taxable entities involved intend to settle the current income tax assets and liabilities on a net basis
or to acquire the assets and The reversal of deferred income tax assets and liabilities is a
significant transaction.
(26) Lease
A lease is a contract in which the lessor cedes the right to use an asset to the lessee for a certain
period of time for consideration. At the inception date of the contract, the Company assesses
whether the contract is a lease or contains a lease. A contract is a lease or contains a lease if one
party to the contract cedes the right to control the use of one or more identified assets for a certain
period of time in exchange for consideration.
If a contract contains several separate leases, the Company splits the contract and accounts for
each separate lease separately. If a contract contains both lease and non-lease components, the
lessee and the lessor split the lease and non-lease components.
1. The Company as lessee
(1) Right-of-use assets
At the commencement date of the lease term, the Company recognizes right-of-use assets for
leases other than short-term leases and leases of low-value assets. Right-of-use assets are initially
measured at cost. This cost includes:
- the initial measurement amount of the lease liability;
- the amount of lease payments made on or before the commencement date of the lease term, net
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of amounts related to lease incentives taken if lease incentives exist;
- the initial direct costs incurred by the Company;
- costs that the Company expects to incur to disassemble and remove the leased asset, restore the
site where the leased asset is located, or restore the leased asset to the condition agreed upon
under the terms of the lease, excluding costs that are part of the costs incurred to produce the
inventory.
The Company subsequently depreciates right-of-use assets using the straight-line method. If it is
reasonably certain that ownership of the leased asset will be obtained at the end of the lease term,
the Company depreciates the leased asset over its remaining useful life; otherwise, the leased asset
is depreciated over the shorter of the lease term or the remaining useful life of the leased asset.
The Company determines whether a right-of-use asset is impaired and accounts for the identified
impairment loss in accordance with the principles described in Note 3(17), "Impairment of Long-
lived Assets".
(2) Lease liabilities
The Company recognizes a lease liability for leases other than short-term leases and leases of low-
value assets at the commencement date of the lease term. Lease liabilities are initially measured at
the present value of the outstanding lease payments. Lease payments consist of
- fixed payments (including material fixed payments), net of amounts related to lease incentives, if
lease incentives exist;
- variable lease payments that are dependent on an index or rate;
- payments expected to be payable based on the residual value of the guarantee provided by the
company;
- the exercise price of the purchase option, provided that the company reasonably determines that
it will exercise the option;
- the amount to be paid upon exercise of the option to terminate the lease, provided that the lease
term reflects that the Company will exercise the option to terminate the lease.
The Company uses the interest rate embedded in the lease as the discount rate, but if the interest
rate embedded in the lease cannot be reasonably determined, the Company's incremental
borrowing rate is used as the discount rate.
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The Company calculates the interest expense on the lease liability for each period of the lease
term based on a fixed periodic interest rate, which is included in the current profit or loss or the
cost of the related asset.
Variable lease payments that are not included in the measurement of the lease liability are charged
to current profit or loss or the cost of the related assets when they are actually incurred.
After the commencement date of the lease term, the Company remeasures the lease liability and
adjusts the corresponding right-of-use asset if the carrying value of the right-of-use asset has been
reduced to zero, but the lease liability still needs to be further reduced, the difference is
recognized in profit or loss for the current period:
- When there is a change in the valuation of the purchase option, lease renewal option or
termination option, or when the actual exercise of the aforementioned options is not consistent
with the original valuation, the Company remeasures the lease liability at the present value
calculated by the changed lease payments and the revised discount rate;
- When there is a change in the substantive fixed payment amount, a change in the amount
expected to be payable for the guaranteed residual value, or a change in the index or rate used to
determine the lease payment amount, the Company remeasures the lease liability at the present
value calculated from the changed lease payment amount and the original discount rate. However,
if the change in the lease payment amount results from a change in the floating interest rate, the
present value is calculated using the revised discount rate.
(3) Short-term leases and leases of low-value assets
The Company has elected not to recognize right-of-use assets and lease liabilities for short-term
leases and leases of low-value assets, and to recognize the related lease payments in current profit
or loss or the cost of the related assets on a straight-line basis over each period of the lease term.
Short-term leases, which are leases with a lease term of not more than 12 months at the
commencement date of the lease term and do not include a purchase option. Low-value asset
leases, which are leases with a lower value when the single leased asset is a brand-new asset. If
the company subleases or expects to sublease the leased assets, the original lease is not a low-
value asset lease.
(4) Change of lease
If a lease is changed and the following conditions are met at the same time, the company will
account for the lease change as a separate lease:
- the lease modification expands the scope of the lease by adding the right to use one or more
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leased assets;
- The increased consideration is equivalent to the separate price of the expanded portion of the
lease adjusted for the circumstances of that contract.
If a lease modification is not accounted for as a separate lease, at the effective date of the lease
modification, the company reapportioned the consideration of the modified contract, redetermined
the lease term, and remeasured the lease liability based on the present value of the modified lease
payments and the revised discount rate.
If a lease change results in a reduction in the scope of the lease or a shortening of the lease term,
the Company reduces the carrying value of the right-of-use asset accordingly and recognizes the
gain or loss related to partial termination or complete termination of the lease in profit or loss for
the current period. If other lease changes result in the remeasurement of the lease liability, the
Company adjusts the carrying value of the right-of-use asset accordingly.
2. The Company as lessor
At the commencement date of the lease, the Company classifies leases into finance leases and
operating leases. A finance lease is a lease that transfers substantially all the risks and rewards
associated with ownership of the leased asset, regardless of whether ownership is ultimately
transferred. Operating leases refer to leases other than finance leases. When the Company acts as a
sublease lessor, it classifies the sublease based on the right-to-use assets arising from the original
lease.
(1) Accounting for operating leases
Lease receipts under operating leases are recognized as rental income on a straight-line basis over
each period of the lease term. The Company capitalizes the initial direct costs incurred in
connection with operating leases and apportions them to current profit or loss over the lease term
on the same basis as rental income is recognized. Variable lease payments that are not included in
the lease receipts are recognized in current profit or loss when they are actually incurred. If a
change in an operating lease occurs, the Company accounts for it as a new lease from the effective
date of the change, and the amount of lease payments received in advance or receivable in
connection with the lease before the change is regarded as the amount of payments received under
the new lease.
(2) Accounting for finance leases
On the commencement date of the lease, the Company recognizes finance lease receivables for
finance leases and derecognizes finance lease assets. When the Company makes initial
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measurement of the finance lease receivable, the net lease investment is used as the recorded
value of the finance lease receivable. The net lease investment is the sum of the unguaranteed
residual value and the present value of the lease receipts not yet received at the commencement
date of the lease term discounted at the interest rate embedded in the lease.
The Company calculates and recognizes interest income for each period of the lease term based
on a fixed periodic interest rate. Derecognition and impairment of finance lease receivables are
accounted for in accordance with Note 3 (ix) "Financial Instruments" of this note.
Variable lease payments that are not included in the net lease investment measurement are
recognized in profit or loss when they are actually incurred.
If a change in a finance lease occurs and the following conditions are met, the Company accounts
for the change as a separate lease:
- the change expands the scope of the lease by adding the right to use one or more leased assets;
- the increased consideration is equivalent to the separate price of the expanded portion of the
lease adjusted for the circumstances of that contract.
If a change in a finance lease is not accounted for as a separate lease, the Company treats the
changed lease separately in the following circumstances:
- If the change becomes effective on the lease commencement date and the lease would be
classified as an operating lease, the Company accounts for it as a new lease from the effective date
of the lease change and uses the net investment in the lease prior to the effective date of the lease
change as the carrying amount of the leased asset;
- If the change becomes effective on the lease commencement date and the lease is classified as a
finance lease, the Company accounts for the lease in accordance with the policy on modification
or renegotiation of contracts as described in Note 3 (ix) Financial Instruments.
3. Sale and leaseback transactions
The Company assesses whether the transfer of assets in sale-and-leaseback transactions is a sale in
accordance with the principles described in Note 3(22) "Revenue".
(1) As a lessee
If the transfer of assets in a sale-and-leaseback transaction is a sale, the Company, as the lessee,
measures the right-of-use asset resulting from the sale-and-leaseback at the portion of the carrying
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
value of the original asset that relates to the right-of-use acquired by the leaseback and recognizes
a gain or loss only for the right transferred to the lessor; if the transfer of assets in a sale-and-
leaseback transaction is not a sale, the Company, as the lessee, continues to recognize the
transferred asset and at the same time recognizes a financial liability equal to the transfer proceeds.
The company continues to recognize the transferred asset as a lessee and at the same time
recognizes a financial liability equal to the transferred revenue. For details of the accounting
treatment of financial liabilities, please refer to Note 3 (9) "Financial Instruments".
(2) As lessor
If the transfer of assets in a sale-and-leaseback transaction is a sale, the Company accounts for the
purchase of the assets as a lessor and accounts for the lease of the assets in accordance with the
aforementioned policy "2. If the transfer of assets in a leaseback transaction is not a sale, the
Company, as the lessor, does not recognize the transferred asset, but recognizes a financial asset
equal to the transferred revenue. For details of the accounting treatment of financial assets, please
refer to Note 3 (9) "Financial Instruments".
(27) Debt restructuring
1. The Company as a creditor
The Company derecognizes a claim when the contractual right to receive cash flows from the
claim is terminated. If a debt restructuring is carried out by settling the debt with assets or
converting the debt into an equity instrument, the Company recognizes the related assets when
they meet the definition and recognition criteria.
For debt restructuring by means of settlement of debts with assets, the Company initially
recognizes the transferred non-financial assets at cost. The cost of inventories includes the fair
value of the relinquished claims and other costs directly attributable to bringing the asset to its
present location and condition, such as taxes, transportation, handling and insurance. The cost of
an investment in an associate or joint venture includes the fair value of the relinquished claim and
other costs such as taxes directly attributable to the asset. The cost of investment property,
including the fair value of the relinquished claims and other costs such as taxes directly
attributable to the asset. The cost of property, plant and equipment includes the fair value of the
relinquished claim and other costs directly attributable to the asset, such as taxes, transportation,
loading and unloading, installation, and professional services, incurred before the asset is brought
to its intended useable condition. The cost of biological assets, including the fair value of the
relinquished claim and other costs directly attributable to the asset, such as taxes, transportation,
and insurance. The cost of intangible assets, including the fair value of the relinquished claims and
other costs directly attributable to taxes incurred in bringing the asset to its intended use. If a debt
restructuring by way of conversion of debt into an equity instrument results in the creditor
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
converting the claim to an equity investment in an associate or a joint venture, the Company
measures the initial investment cost of the claim at the fair value of the relinquished claim and
other costs, such as taxes, that are directly attributable to the asset. The difference between the fair
value of the relinquished claim and its carrying amount is recognized in profit or loss.
If debt restructuring is carried out by modifying other terms, the Company recognizes and
measures the restructured claims in accordance with "III. (IX) Financial Instruments" in this note.
For debt restructuring using multiple assets or a combination of assets, the Company first
recognizes and measures the transferred financial assets and restructuring claims in accordance
with "III. (IX) Financial instruments" in this note, and then, in proportion to the fair value of each
asset other than the transferred financial assets, recognizes a net gain or loss on the fair value of
the claims net of the amount recognized for the transferred financial assets and restructuring
claims. The fair value of each asset other than the transferred financial assets is then allocated to
the net amount after deducting the recognized amount of the transferred financial assets and the
restructuring claim in proportion to the fair value of each asset, and the cost of each asset is
determined separately on this basis in accordance with the aforementioned method. The difference
between the fair value and the carrying amount of the abandoned claims shall be recognized in
profit or loss for the current period.
2. The Company as debtor
The Company derecognizes a debt when the present obligation of the debt is discharged.
For debt restructuring by way of settlement of debts with assets, the Company derecognizes the
relevant assets and debts settled when the conditions for derecognition are met, and the difference
between the carrying amount of the debts settled and the carrying amount of the assets transferred
is recognized in profit or loss for the current period.
For debt restructuring by converting debt to equity instruments, the Company derecognizes the
debt when the debt settled meets the conditions for derecognition. The Company initially
recognizes an equity instrument at the fair value of the equity instrument. If the fair value of the
equity instrument cannot be reliably measured, it is measured at the fair value of the debt settled.
The difference between the carrying amount of the debt settled and the amount recognized for the
equity instrument shall be recognized in profit or loss for the current period.
If debt restructuring is carried out by modifying other terms, the Company recognizes and
measures the restructured debt in accordance with "III (IX) Financial Instruments" in this note.
When debt restructuring is carried out by using multiple assets to settle debts or by combining
them, the Company recognizes and measures equity instruments and restructured debts in
116
Wafangdian Bearing Co., Ltd. 2023 annual report full text
accordance with the aforementioned method, and the difference between the carrying amount of
the debt settled and the sum of the carrying amount of the transferred assets and the amounts
recognized for equity instruments and restructured debts is recognized in profit or loss for the
current period.
(28) Methodology for determining materiality criteria and basis for selection
Items Materiality criterion
Where there is solid evidence that a credit impairment has
occurred on an account receivable, the amount is not
Significant single provision for bad debt accounts
expected to be recovered or is unlikely to be recovered, a
receivable
single provision is made for doubtful debts and expected
credit losses are recognized
If there is solid evidence that the credit risk of the accounts
receivable separately accrued in the previous period has
Accounts receivable The amount of provision for decreased significantly, the future cash flow of the accounts
recovery or repatriation of current doubtful receivable shall be predicted according to the reassessed
accounts is significant credit risk, and the increased cash flow difference shall be
reversed, and the amount of the reversal shall be included
in the current profit or loss.
For receivables which have solid evidence that they cannot
be recovered in whole or in part, the portion which cannot
be recovered shall be regarded as bad debt loss and the
Write off significant receivables for the period provision for bad debts already drawn shall be written off;
If the provision for bad debts is insufficient to be written
off, the difference in bad debt losses shall be included in the
current profit or loss.
(29) Changes in significant accounting policies and accounting estimates
1. Changes in significant accounting policies
Implementation of ASBE Interpretation No. 16, "Accounting for Deferred Taxes on Assets and
Liabilities Arising from a Single Transaction to Which the Initial Recognition Exemption Does
Not Apply".
The Ministry of Finance issued "Interpretation No. 16 of the Accounting Standards for Business
Enterprises" ("Interpretation No. 16") on November 30, 2022 (Caijing [2022] No. 31, hereinafter
referred to as "Interpretation No. 16"), which stipulates that the "Accounting treatment of deferred
income taxes related to assets and liabilities arising from a single transaction that are not exempt
from initial recognition" shall be implemented from November 30, 2022 onwards. The
"Accounting Treatment for Deferred Taxes on Assets and Liabilities Arising from Individual
Transactions that are not Subject to the Initial Recognition Exemption" is effective from January 1,
2023 onwards.
Interpretation No. 16 stipulates that for a single transaction that is not a business combination and
does not affect either accounting profit or taxable income (or deductible losses) at the time the
transaction occurs, and for which the initial recognition of assets and liabilities results in the
117
Wafangdian Bearing Co., Ltd. 2023 annual report full text
creation of taxable temporary differences and deductible temporary differences in equal amounts
(including lease transactions in which the lessee initially recognizes a lease liability on the
commencement date of the lease term and includes it in the assets with the right of use, and
transactions in which the lessee initially recognizes a lease liability for a fixed asset or other asset
and includes it in the assets with the right of use), and in which there is an abandonment
obligation for a fixed asset or other asset, the initial recognition of an asset or a liability is
excluded. The exemption from initial recognition of deferred tax liabilities and deferred tax assets
does not apply to individual transactions (including lease transactions in which the lessee initially
recognizes a lease liability and credits it to the right-of-use asset on the commencement date of the
lease term, as well as individual transactions in which the lessee recognizes a projected liability
and credits it to the cost of the relevant asset due to the existence of an abandonment obligation
for a fixed asset, etc.), and the enterprise shall recognize the corresponding When the transaction
occurs, the enterprise should recognize the corresponding deferred tax liabilities and deferred tax
assets in accordance with the relevant provisions of "ASBE No. 18 - Income Taxes" and other
relevant regulations.
If taxable temporary differences and deductible temporary differences arise from a single
transaction to which this provision applies that occurs between the beginning of the earliest period
for which the financial statements are presented for the first time and the date of its application, as
well as lease liabilities and right-of-use assets recognized at the beginning of the earliest period
for which the financial statements are presented as a result of a single transaction to which the
provision applies and the recognition of projected liabilities related to abandonment obligations
and the corresponding related assets, enterprises shall make adjustments in accordance with this
provision. companies should make adjustments in accordance with this provision.
The Company implemented this provision from January 1, 2023, and the implementation of this
provision did not have a significant impact on the Company's financial position and results of
operations.
2. Changes in significant accounting estimates
There were no changes in the Company's significant accounting estimates during the reporting
period.
VI.Taxation
1. The main applicable tax and rate to the Group as follows:
Tax Tax base Tax rate
The output tax is calculated on the basis of the income from the
sale of goods and taxable services calculated in accordance with
Value-added tax (VAT) the provisions of the tax law, and after deducting the input tax 13%,9%,6%,5%
allowed to be deducted in the current period, the difference is the
value-added tax payable
City construction tax Value-added tax payables 7%
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Tax Tax base Tax rate
Education surcharge Value-added tax payables 3%
Local education surcharge Value-added tax payables 2%
Enterprise income tax (EIT) Current period taxable profit 15% or 25%
Real estate tax 70% of cost of own property or revenue from leasing property 1.2% or 12%
CNY 6 per
Land use tax Land using right area
square meter
Notes: EIT rate for different tax payer
Tax principles EIT rate
Wafangdian Bearing Co., Ltd 15%
Wazhou Liaoyang Bearing construction Co., Ltd 15%
Dalian Wazhou Precision Motor Car Bearing Company Limited 25%
Wazhou Precision of Spherical Roller Bearings (Wafangdian) Co., Ltd 25%
2.Tax preference
On December 3, 2020, the Company obtained the qualification of high-tech enterprise
certification, high-tech enterprise certification certificate number is GR202021200656, valid for 3
years, according to the tax law, can enjoy the preferential tax policy of enterprise income tax
levied at a tax rate of 15% within 3 years.
The subsidiary Waxiang Liaoyang Bearing Manufacturing Co., Ltd. obtained the qualification of
high-tech enterprise identification on December 20, 2023, and the high-tech enterprise
identification certificate number is GR202321002020, valid for 3 years, and can enjoy the
preferential tax policy of levying enterprise income tax at a tax rate of 15% within 3 years
according to the tax law.
VII. Notes to Consolidated Financial Statements
i. Monetary Funds
Items Closing balance Opening balance
Cash on hand 292.91
Cash in bank 110,664,560.63 227,356,998.46
Other cash and cash equivalents 100,149,667.42 103,389,415.51
Total 210,814,228.05 330,746,706.88
ii. Transactional financial assets
Items Closing balance Opening balance
1. Financial asset measured at fair value through
214,178.33 243,454.50
P&L
Among them: Debt instrument investment -
Equity instrument investment 214,178.33 243,454.50
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Items Closing balance Opening balance
Others -
Total 214,178.33 243,454.50
iii. Note receivable
1. Types of notes
Items Closing balance Opening balance
Bank acceptance 354,777,692.67 445,227,090.19
Finance company acceptance 16,933,056.95
Trade acceptance 83,169,223.80 65,722,577.37
Total 454,879,973.42 510,949,667.56
Less: Provision for impairment 4,158,461.19 2,978,533.87
Total 450,721,512.23 507,971,133.69
2. Category of note receivable
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Notes receivable with bad debt
provision based on the characters of 454,879,973.42 100 4,158,461.19 0.91 450,721,512.23
credit risk portfolio
including:
Bank acceptance 354,777,692.67 77.99 354,777,692.67
Finance company acceptance 16,933,056.95 3.72
Trade acceptance 83,169,223.80 18.28 4,158,461.19 5 79,010,762.61
Total 454,879,973.42 100 4,158,461.19 450,721,512.23
(Continued)
Opening balance
Items Booking balance Provision
Booking value
Amount % Amount %
Notes receivable with bad debt
provision based on the characters of 474,064,980.02 100 4,280,386.41 0.9 469,784,593.61
credit risk portfolio
including:
Bank acceptance 415,924,381.54 87.74 415,924,381.54
Finance company acceptance
Trade acceptance 58,140,598.48 12.26 4,280,386.41 7.36 53,860,212.07
Total 474,064,980.02 100 4,280,386.41 469,784,593.61
Notes receivable with bad debt provision based on the characters of credit risk portfolio:
Closing Balance
Items
Booking balance Amount %
Bank acceptance 354,777,692.67
120
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Finance company acceptance 16,933,056.95
Trade acceptance 83,169,223.80 4,158,461.19 5
Total 454,879,973.42 4,158,461.19
3. Provision for bad debts charged off, reversed or recovered during the period：
Change during the year Closing
Category Opening balance
Accrued Collect/carry over Written-off Balance
Provision for bad debt 4,280,386.41 2,021,131.95 2,143,057.17 4,158,461.19
Total 4,280,386.41 2,021,131.95 2,143,057.17 - 4,158,461.19
4. Pledged notes receivable up to the end of year:
Items Closing amount of pledged
Finance company acceptance 2,982,604.41
Trade acceptance 14,770,614.03
Total 17,753,218.44
5. Notes receivable endorsed or discounted but not mature at the end of year
Closing amount no more Closing amount still
Items
recognized recognized
Bank acceptance 302,155,516.10
Finance company acceptance 12,011,143.08
Trade acceptance 43,099,544.33
Total 357,266,203.51
iv. Account receivable
1. Category of accounts receivable listed by age
Aging Closing Balance Opening balance
Within1 year 962,345,577.17 1,007,255,429.21
1-2 years 80,034,862.45 169,054,402.12
2-3 years 96,451,169.89 36,587,357.00
3-4years 32,592,645.89 8,448,563.73
4-5years 6,535,792.15 14,065,231.25
Over 5 years 39,496,995.40 36,192,353.92
Total 1,217,457,042.95 1,271,603,337.23
Less: Provision for bad debt 131,019,034.27 135,308,007.64
Total 1,086,438,008.68 1,136,295,329.59
2. Category of accounts receivable
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Closing Balance
Items Booking balance Provision
Amount % Amount % Booking value
Accounts receivable with
72,346,024.97 5.94 72,346,024.97 100.00
individual bad debt provision
Accounts receivable with bad
debt provision based on the 1,145,111,017.98 94.06 58,673,009.30 5.12 1,086,438,008.68
characters of credit risk portfolio
Including:
-Aging portfolio 889,317,987.55 73.05 58,673,009.30 6.60 830,644,978.25
-Related party portfolio 255,793,030.43 21.01 255,793,030.43
Total 1,217,457,042.95 100.00 131,019,034.27 1,086,438,008.68
(Continued)
Opening Balance
Items Booking balance Provision
Amount % Amount % Booking value
Accounts receivable with
77,765,538.08 6.12 77,765,538.08 100.00
individual bad debt provision
Accounts receivable with bad
debt provision based on the 1,193,837,799.15 93.88 57,542,469.56 4.82 1,136,295,329.59
characters of credit risk portfolio
Including:
-Aging portfolio 937,128,769.48 73.70 57,542,469.56 6.14 879,586,299.92
-Related party portfolio 256,709,029.67 20.18 256,709,029.67
Total 1,271,603,337.23 100.00 135,308,007.64 1,136,295,329.59
122
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Bad debt provision for accounts receivable at the end of year based on individual：
Closing Balance Opening balance
Debtors name Accounts Provision for bad Reasons for Accounts Provision for
%
receivable debts provision receivable bad debts
Heilongjiang Longmei Logistics Co., Ltd 11,277,327.79 11,277,327.79 100 uncollectable 2,134,140.98 2,134,140.98
Liaoning Yinheng Galvanized Colored Coated Steel Sheet Co. Ltd 3,213,308.67 3,213,308.67 100 uncollectable 3,213,308.67 3,213,308.67
Shenzhen Geesun Intelligent Technology Co., Ltd. 2,296,400.00 2,296,400.00 100 uncollectable 133,560.00 133,560.00
Shandong Yuanda Board Technology Co., Ltd 1,804,722.77 1,804,722.77 100 uncollectable 1,804,722.77 1,804,722.77
Yingkou Iron & Steel Co. Ltd 1,696,318.44 1,696,318.44 100 uncollectable 1,696,318.44 1,696,318.44
Liaoning Wazhou Bearing Sales Co.,Ltd 1,611,795.99 1,611,795.99 100 uncollectable
HBIS Company Limited Handan Branch 1,608,611.42 1,608,611.42 100 uncollectable 1,608,611.42 1,608,611.42
An Gang steel Co.,Ltd 1,595,050.69 1,595,050.69 100 uncollectable 1,595,050.69 1,595,050.69
Bazhou Tianli Tube Co., Ltd 1,325,600.76 1,325,600.76 100 uncollectable 1,325,600.76 1,325,600.76
Zhejiang Yesheng New Material Co. Ltd 1,301,760.00 1,301,760.00 100 uncollectable 1,301,760.00 1,301,760.00
CITIC Heavy Industries Co.,Ltd 1,126,828.28 1,126,828.28 100 uncollectable 1,128,791.54 1,128,791.54
Donghai New Material Co. Ltd 942,558.20 942,558.20 100 uncollectable 942,558.20 942,558.20
Shanghai Jieru Heavy Industry Mechanical Equipment Co., Ltd 923,603.80 923,603.80 100 uncollectable 923,603.80 923,603.80
Tangshan Guofeng Iron and Steel Co. LTD 883,297.41 883,297.41 100 uncollectable 883,297.41 883,297.41
Tongling Nonferrous Metals Group Co., Ltd 877,123.18 877,123.18 100 uncollectable 59,329.56 59,329.56
Jilin Chengzhong Auto Parts Co., Ltd 872,874.22 872,874.22 100 uncollectable 872,874.22 872,874.22
Wanxin(Deyang) Engineering & Equipment Co., Ltd. of China National Erzhong Group 795,887.92 795,887.92 100 uncollectable 795,887.92 795,887.92
Benxi Beiying Steel (Group) Co. Ltd 775,804.98 775,804.98 100 uncollectable 775,804.98 775,804.98
Zhongguang Keji(Fujian)Co.,Ltd. 761,374.62 761,374.62 100 uncollectable 761,374.62 761,374.62
Shandong Yuntong New Material Technology Co. Ltd 711,438.94 711,438.94 100 uncollectable 711,438.94 711,438.94
Dongfeng Transmission Co.,Ltd 704,098.23 704,098.23 100 uncollectable 704,098.23 704,098.23
Shanghai Weiqiang Heavy Industry Mechanic Co.,Ltd 673,595.42 673,595.42 100 uncollectable 673,595.42 673,595.42
Dalian Tianyuan Motor Co.,Ltd 666,383.31 666,383.31 100 uncollectable 666,383.31 666,383.31
Shanxi Hongda Iron&Steel Co.,Ltd 657,373.00 657,373.00 100 uncollectable 657,373.00 657,373.00
Dandong Shuguang Heavy Axle Co., Ltd 642,833.42 642,833.42 100 uncollectable 642,833.42 642,833.42
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Hangzhou Advance Gearbox Group Co., Ltd 626,952.30 626,952.30 100 uncollectable 634,135.80 634,135.80
Wolong Electric Huai 'an Qingjiang Motor Co. Ltd 601,859.03 601,859.03 100 uncollectable 601,859.03 601,859.03
Xingtai Iron and Steel Co., Ltd 590,148.98 590,148.98 100 uncollectable 590,148.98 590,148.98
Qinghai Lufeng New Material Co., Ltd 525,743.44 525,743.44 100 uncollectable 525,743.44 525,743.44
Jiangsu Leche Heavy Industry Machinery Co. LTD 506,477.77 506,477.77 100 uncollectable 506,477.77 506,477.77
Bengang Steel Plates Co., Ltd 487,064.68 487,064.68 100 uncollectable 487,064.68 487,064.68
Dongfeng Commercial Vehicle Co., Ltd 486,019.87 486,019.87 100 uncollectable 486,019.87 486,019.87
Mudanjiang Reduction Gears Factory 467,905.65 467,905.65 100 uncollectable 467,905.65 467,905.65
Shandong Zhangqiu Blower Co.,Ltd. 461,708.13 461,708.13 100 uncollectable 461,708.13 461,708.13
07-256 Factory 460,854.77 460,854.77 100 uncollectable 460,854.77 460,854.77
Hunan Chaoyang Mechanic & Electric Co.,Ltd 446,627.60 446,627.60 100 uncollectable 446,627.60 446,627.60
Liaoyang Sudong Trade Co.,Ltd 444,946.96 444,946.96 100 uncollectable 444,946.96 444,946.96
XEMC 416,549.65 416,549.65 100 uncollectable 416,549.65 416,549.65
Shanxi Taigang Stainless Steel Co.,Ltd. 402,332.21 402,332.21 100 uncollectable 402,332.21 402,332.21
Chengdu Gaoyuan Electromechanical Equipment Co.,Ltd. 383,615.52 383,615.52 100 uncollectable 383,615.52 383,615.52
Ningbo Netjia Machinery Manufacturing Co.,Ltd 383,370.79 383,370.79 100 uncollectable
Boshan Motor Group Co.,Ltd 373,700.65 373,700.65 100 uncollectable 373,700.65 373,700.65
Xuzhou Xugong Material Supply Co., Ltd 373,237.55 373,237.55 100 uncollectable 373,237.55 373,237.55
Tai'an Tianhua Economic and Trade Co., Ltd 364,189.79 364,189.79 100 uncollectable 346,554.01 346,554.01
Liaohe Mechanic Co.,Ltd 362,280.30 362,280.30 100 uncollectable 362,280.30 362,280.30
Min Metals Yingkou Medium Plate Co.,Ltd. 351,890.29 351,890.29 100 uncollectable 351,890.29 351,890.29
Northeast Special Steel Group Beiman Special Steel Co. Ltd 315,004.72 315,004.72 100 uncollectable 315,004.72 315,004.72
Taicang Hu Tai Chang’e Paper Equipment Co. Ltd 310,361.32 310,361.32 100 uncollectable 310,361.32 310,361.32
Pangang Group Chengdu Iron&Steel Co.,Ltd. 303,305.45 303,305.45 100 uncollectable 303,305.45 303,305.45
Hebei Jinxi Iron & Steel Group Co. Ltd 301,978.67 301,978.67 100 uncollectable 301,978.67 301,978.67
Harbin Hakuo Electric Power Technology Co. Ltd 297,905.32 297,905.32 100 uncollectable 297,905.32 297,905.32
Zhongcai Zibo Heavy Machinery Co.,Ltd 293,817.58 293,817.58 100 uncollectable
ZHUZHOU GEAR CO.,LTD. 290,587.00 290,587.00 100 uncollectable 270,087.40 270,087.40
NINGBO FAN CO.,Ltd 287,783.07 287,783.07 100 uncollectable
Jiangsu Xinrui Gear System Co. Ltd 286,949.88 286,949.88 100 uncollectable 286,949.88 286,949.88
124
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China erzhong group (deyang)jingheng driving equipment co.ltd 286,935.03 286,935.03 100 uncollectable 286,935.03 286,935.03
Siemens Electric Motor (China) Co., Ltd 284,110.82 284,110.82 100 uncollectable 284,110.82 284,110.82
Baofeng Xianglong Stainless Steel Co.,Ltd 273,900.00 273,900.00 100 uncollectable
Baotou Tianli Huanfa Mechanical & Electrical Co.,Ltd 273,597.27 273,597.27 100 uncollectable
Hengfengtai Precision Machinery Co., Ltd 270,886.98 270,886.98 100 uncollectable 318,948.38 318,948.38
Anhui Jianghuai Automobile Group Co., Ltd. Light Commercial Vehicle Branch 264,521.67 264,521.67 100 uncollectable 264,521.67 264,521.67
Baoji Zhongyi Industry and Trade Co. Ltd 256,372.12 256,372.12 100 uncollectable 256,372.12 256,372.12
Taiyuan Heavy Industry Co., Ltd 254,016.66 254,016.66 100 uncollectable 275,596.93 275,596.93
Baoji Huawei Mine Machinery Co.,Ltd. 248,758.75 248,758.75 100 uncollectable 200,000.00 200,000.00
Yanggu Dangyu Sheet Co., Ltd 243,280.00 243,280.00 100 uncollectable 243,280.00 243,280.00
Tonghua Iron & Steel Co. Ltd 240,568.39 240,568.39 100 uncollectable 240,568.39 240,568.39
Shijiazhuang Qiangda Slurry Pump Co.,Ltd 238,749.98 238,749.98 100 uncollectable 238,749.98 238,749.98
Inner Mongolia Hongji Technology New Energy Co., Ltd 231,610.81 231,610.81 100 uncollectable 231,610.81 231,610.81
Taizhong Coal Machine Co.,Ltd 215,142.12 215,142.12 100 uncollectable 215,142.12 215,142.12
Qinhuangdao Shouqin Metal Material Co. Ltd 213,911.48 213,911.48 100 uncollectable 213,911.48 213,911.48
Chongqing Iron Horse Industry Group Co., Ltd 211,196.98 211,196.98 100 uncollectable 211,196.98 211,196.98
SAIC IVECO Hongyan Commercial Vehicle Co., Ltd 210,860.60 210,860.60 100 uncollectable 210,860.60 210,860.60
Hubei Tongfang High-tech Pump Co., Ltd 207,567.06 207,567.06 100 uncollectable 121,727.00 121,727.00
Panzhihua Steel Group Panzhihua Steel Vanadium Co.,Ltd. 203,004.70 203,004.70 100 uncollectable 2,652.78 2,652.78
Tianjin Rongtai Advanced Composite Material Co.,Ltd 200,000.00 200,000.00 100 uncollectable 200,000.00 200,000.00
Hebei Wenfeng Iron & Steel Co. Ltd 197,979.65 197,979.65 100 uncollectable 197,979.65 197,979.65
Suzhou Zhanwang Mechanic & Electric Co.,Ltd 192,173.26 192,173.26 100 uncollectable 192,173.26 192,173.26
Guangzhou Motor Co.,Ltd 189,128.68 189,128.68 100 uncollectable 189,128.68 189,128.68
Jiangsu Xuzhou Forging Machine Tool Factory Group Co., Ltd 188,906.34 188,906.34 100 uncollectable 188,906.34 188,906.34
Hubei Wazhou Xinsheng Technology Co., Ltd 188,136.00 188,136.00 100 uncollectable 188,136.00 188,136.00
Handan Sida Electric Co., Ltd 186,191.80 186,191.80 100 uncollectable 186,191.80 186,191.80
Nanjing Light Industry Machinery Factory 185,079.54 185,079.54 100 uncollectable 185,079.54 185,079.54
Shanghai Sule Textile Machinery Co., Ltd 176,984.10 176,984.10 100 uncollectable 176,984.10 176,984.10
Taiyuan Tongze Heavy Industry Co., Ltd 170,178.79 170,178.79 100 uncollectable 170,178.79 170,178.79
Beijing Jingcheng Star Technology Development Co., Ltd 170,010.00 170,010.00 100 uncollectable 450,000.00 450,000.00
125
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Shandong Huali Motor Group Suzhou Manufacturing Co., Ltd 164,801.28 164,801.28 100 uncollectable 244,801.28 244,801.28
Xuzhou Meichi Vehicle and Bridge Co., Ltd 163,037.45 163,037.45 100 uncollectable 163,037.45 163,037.45
Siping Blower Co., Ltd 160,053.21 160,053.21 100 uncollectable 160,053.21 160,053.21
Anyang Coal Mine Electrical Machinery Factory 159,537.60 159,537.60 100 uncollectable 159,537.60 159,537.60
Xiangdian Heavy Equipment Co., Ltd 158,854.17 158,854.17 100 uncollectable 158,854.17 158,854.17
Shanxi Electric Machinery Factory 158,021.97 158,021.97 100 uncollectable 158,021.97 158,021.97
Hubei Quanli Machinery Group Co. Ltd 152,489.82 152,489.82 100 uncollectable 152,489.82 152,489.82
Steel Butler (Shanghai) Technology Co.,Ltd 151,927.34 151,927.34 100 uncollectable
Shandong Kerui Steel Plate Co.,Ltd. 151,411.57 151,411.57 100 uncollectable 156,702.16 156,702.16
Anshan Iron and Steel Co., Ltd. 150,734.55 150,734.55 100 uncollectable 150,734.55 150,734.55
Wafangdian Hongda Constant Velocity Joint Manufacturing Co., Ltd 148,466.32 148,466.32 100 uncollectable 148,466.32 148,466.32
Bei Shang Guang (Guangzhou) Machinery Equipment Co.,Ltd 135,345.75 135,345.75 100 uncollectable
J.S. Corrugating Machinery Co.,Ltd 132,087.65 132,087.65 100 uncollectable
Anhui Anfeng Fan Co., Ltd 131,355.36 131,355.36 100 uncollectable 131,355.36 131,355.36
Shanghai Sule Textile Machinery Co., Ltd 126,752.70 126,752.70 100 uncollectable 176,984.10 176,984.10
Zhejiang Zhonghong Motor Co. 126,348.05 126,348.05 100 uncollectable 126,348.05 126,348.05
Shenyang Qunding Machinery Equipment Co., Ltd 126,286.35 126,286.35 100 uncollectable 126,286.35 126,286.35
Tangshan Dunshi Machinery Manufacturing Co. Ltd 124,474.60 124,474.60 100 uncollectable 124,474.60 124,474.60
Guangxi Tianyang Huamei Paper Co. Ltd 122,629.00 122,629.00 100 uncollectable 122,629.00 122,629.00
NFC Shenyang Metallurgical Machinery Co.,Ltd. 121,909.54 121,909.54 100 uncollectable 121,909.54 121,909.54
Harbin First Machinery Manufacturing Group Co., Ltd 121,033.33 121,033.33 100 uncollectable 121,033.33 121,033.33
Anhui Foma Auto Parts Group Co.,Ltd 119,386.14 119,386.14 100 uncollectable
ANSHAN ANZHONG MINING MACHINERY CO. LTD 116,819.89 116,819.89 100 uncollectable 83,746.30 83,746.30
Nantong Electric Machinery Factory 113,634.74 113,634.74 100 uncollectable 113,634.74 113,634.74
Shanghai Yaotai Engineering Technology Co., Ltd 113,054.61 113,054.61 100 uncollectable 113,054.61 113,054.61
Qinhuangdao Huaye Motor Co., Ltd 111,564.44 111,564.44 100 uncollectable 111,564.44 111,564.44
Beijing Research Institute of Automation for Machinery Industry Co., Ltd. 111,484.00 111,484.00 100 uncollectable
Shandong Baoding Coal Coking Co. Ltd 110,528.29 110,528.29 100 uncollectable 110,528.29 110,528.29
Dalian Dalma Motor Co., Ltd 109,553.86 109,553.86 100 uncollectable 109,553.86 109,553.86
Wuhan Autopilot Motor Co.,Ltd 109,112.60 109,112.60 100 uncollectable
126
Wafangdian Bearing Co., Ltd. 2023 annual report full text
TISCO Group Dongfang Steel Co. 108,997.44 108,997.44 100 uncollectable 108,997.44 108,997.44
YINGKOU JIACHEN COKING & CHEMICAL INCORPORATION 108,451.55 108,451.55 100 uncollectable 108,451.55 108,451.55
Lingyuan Iron&Steel Co.,Ltd. 108,446.16 108,446.16 100 uncollectable 110,000.00 110,000.00
SHOUGANG CHANGZHISTEEL&IRON CO.,LTD 107,819.72 107,819.72 100 uncollectable
Tianma Automobile Group Co.,Ltd. 107,121.10 107,121.10 100 uncollectable 107,121.10 107,121.10
Shenyang Sanming Heavy Industry Machinery Co., Ltd 105,807.39 105,807.39 100 uncollectable 105,807.39 105,807.39
Tongchuan Explosion-Proof Electric Machine Factory 105,476.07 105,476.07 100 uncollectable 105,476.07 105,476.07
Weichai Medium-Sized Diesel Engine (Weifang) Co., Ltd 104,548.21 104,548.21 100 uncollectable 104,548.21 104,548.21
Jiangsu Aerospace Power Co., Ltd 104,257.06 104,257.06 100 uncollectable 82,187.55 82,187.55
DBI USA, Inc. 102,568.64 102,568.64 100 uncollectable 102,568.64 102,568.64
Datong Risheng Jingrui Bearing Co.,Ltd 100,520.79 100,520.79 100 uncollectable
Yangmei Xinzhou General Machinery Co., Ltd 100,447.88 100,447.88 100 uncollectable 100,447.88 100,447.88
Others 8,453,966.80 8,453,966.80 100 uncollectable 30,021,623.98 30,021,623.98
Total 72,346,024.97 72,346,024.97 77,765,538.08 77,765,538.08
127
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Notes receivable with bad debt provision based on the characters of credit risk portfolio:
Combined accrual items:
Closing Balance
Aging
Accounts receivable Provision for bad debts Proportion (%)
Within 1 year 784,002,240.34 39,234,462.24 5.00
1-2 years 69,545,383.46 6,954,538.35 10.00
2-3 years 23,076,562.45 4,615,312.49 20.00
3-4years 9,116,525.49 4,558,262.75 50.00
4-5years 1,334,211.66 1,067,369.33 80.00
Over 5 years 2,243,064.15 2,243,064.15 100.00
Related Party Portfolio 255,793,030.43
Total 1,145,111,017.98 58,673,009.30
3. Provision for bad debts charged off, reversed or recovered during the period：
Change during the year
Category Opening balance Collect/carry Closing Balance
Accrued Written-off
over
Provision for
135,308,007.64 7,732,014.97 1,249,854.25 10,771,134.09 131,019,034.27
bad debt
Total 135,308,007.64 7,732,014.97 1,249,854.25 10,771,134.09 131,019,034.27
4. Accounts receivable written off in current period:
Item Written-off Amount
Accounts receivable written off 10,771,134.09
Significant amount written off:
Nature of Procedure to Related
Company name Amount Reason
receivable be performed party
Wafangdian Bearing Group Special Unable to Internal
Trade payment 5,092,669.00 N
Steel Co.,Ltd recover approval
Shandong Hengji New Material Unable to Internal
Trade payment 2,284,666.96 N
Co.,Ltd recover approval
Henan Taihang Vibration Unable to Internal
Trade payment 989,207.41 N
Machinery Co.,Ltd recover approval
Unable to Internal
Shaanxi Hande Axle Co.,Ltd Trade payment 309,157.59 N
recover approval
Shandong Guanpeng Sheet Metal Unable to Internal
Trade payment 273,748.84 N
Co.,Ltd recover approval
Unable to Internal
Shaanxi Hande Axle Co.,Ltd Trade payment 261,036.63 N
recover approval
Zibo Boshan Qianjin Reducer Unable to Internal
Trade payment 244,579.32 N
Factory Co.,Ltd recover approval
Taizhou Luqiao Meitian Motorcycle Unable to Internal
Trade payment 200,562.00 N
Co.,Ltd recover approval
128
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Shijiazhuang Electric Machinery Unable to Internal
Trade payment 172,543.31 N
Co.,Ltd recover approval
Shenyang SAIC Jinbei Automobile Unable to Internal
Trade payment 109,908.15 N
Transmission Co.,Ltd recover approval
Total 9,938,079.21
5、The top five significant accounts receivable categorized by debtors:
Closing Balance Proportion Receivable
of total bad debts &
Debtors name Contractu closing contractual
Receivable Total balance assets
al assets
(%) impairment
Wafangdian Bearing Group
255,377,958.78 255,377,958.78 20.98
Corporation and subsidiaries
China National Railway Group
65,328,867.27 65,328,867.27 5.37 3,315,586.02
Corporation and subsidiaries
China Railway Group
Corporation (CRGC)and 46,806,964.33 46,806,964.33 3.84 2,640,533.11
subsidiaries
Dalian Heavy Industry Crane
Group Corporation and 38,058,776.35 38,058,776.35 3.13 2,022,930.49
subsidiaries
China Shipbuilding Industry
23,949,683.21 23,949,683.21 1.97 1,276,968.12
Materials Southwest Co.,Ltd
Total 429,522,249.94 429,522,249.94 35.29 9,256,017.74
v. Financing receivable
1.Receivables financing
Items Closing Balance Opening Balance
Bank acceptance 55,546,474.87 30,996,930.63
Total 55,546,474.87 30,996,930.63
2.Changes in receivables financing during the period and changes in fair value
Accumulated
provision for
Derecognition losses
Opening New in this Closing
Items during the recognized in
Balance period Balance
period other
comprehensive
income
Bank acceptance 30,996,930.63 45,546,474.87 30,996,930.63 45,546,474.87
Total 30,996,930.63 45,546,474.87 30,996,930.63 45,546,474.87
3.Pledged receivable financing up to the end of year
Items Amount
Bank acceptance 10,000,000.00
Total 10,000,000.00
4.Receivable financing endorsed or discounted but not mature at the end of year
Amount derecognized at end Amounts not derecognized at
Items
of period the end of the period
129
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Amount derecognized at end Amounts not derecognized at
Items
of period the end of the period
Bank acceptance 356,497,666.90
Total 356,497,666.90
vi. Prepayment
1.Aging of advances to suppliers
Closing Balance Opening Balance
Items
Amount Percentage (%) Amount Percentage (%)
Within 1 year 14,347,294.97 84.70 52,055,924.36 98.40
1 to 2 years 2,423,315.53 14.30 543,392.56 1.03
2 to 3 years 169,282.17 1.00 301,749.09 0.57
More than 3 years
Total 16,939,892.67 100.00 52,901,066.01 100.00
2.The top five significant advances to suppliers categorized by debtors
Company name Closing Balance Proportion of receivable (%)
Daye Special Steel co.,Ltd 7,130,802.81 42.09
Fushun Special Steel Co., Ltd 3,039,178.58 17.94
Wafangdian Bearing Power Co., Ltd 1,367,700.54 8.07
Ben Steel Plate Co., Ltd 1,058,384.41 6.25
Northeast Special Steel Group Co., Ltd 1,010,862.63 5.97
Total 13,606,928.97 80.32
vii. Other receivables
Items Closing Balance Opening Balance
Interest receivable - -
Dividend receivable - -
Other receivable 9,403,175.09 10,555,282.33
Total 9,403,175.09 10,555,282.33
1.Other receivables
(1) Disclosure by aging：
Aging Closing Balance Opening Balance
Within 1 year (including 1year) 5,467,667.70 8,149,792.09
1-2 years 3,088,808.31 3,131,360.53
2-3 years 2,110,239.68 520,211.96
3-4years 302,195.88 254,121.72
4-5years 89,830.61 119,264.25
130
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Over 5 years 6,046,915.80 5,508,712.55
Total 17,105,657.98 17,683,463.10
7,702,482.89 7,128,180.77
Less:Provision for bad debt
9,403,175.09 10,555,282.33
Total
(2) Categories of other receivable
Closing Balance
Items
Booking balance Provision Booking
balance
Amount % Amount %
Provision for bad debts is 5,558,491.59 32.50 5,558,491.59 100.00
made on an individual basis
Provision for bad debts by
11,547,166.39 67.50 2,143,991.30 18.57 9,403,175.09
portfolio
Including:
Account receivable 9,385,366.49 54.87 2,143,991.30 18.62 7,241,375.19
aging portfolio
Risk-free portfolio 912,254.08 5.33 912,254.08
Related party portfolio 1,249,545.82 7.30 1,249,545.82
Total 17,105,657.98 100.00 7,702,482.89 9,403,175.09
(Continued)
Opening Balance
Booking balance Provision Booking
Items balance
Amount % Amount %
Provision for bad debts is 4,667,065.27 26.39 4,667,065.27 100.00
made on an individual basis -
Provision for bad debts by 13,016,397.83 73.61 2,461,115.50 18.91 10,555,282.33
portfolio
Including:
Account receivable 11,512,069.85 65.10 2,461,115.50 11,512,069.85 65.10
aging portfolio
Risk-free portfolio 1,450,322.45 8.20
- -
Related party portfolio 54,005.53 0.31
- -
Total 17,683,463.10 100.00 7,128,180.77 10,555,282.33
Provision for bad debts is made on an individual basis:
Closing Balance Opening Balance
Items Booking Accrual Reason for Booking
Bad debts bad debts
balance rate(%) accrual balance
Other
receivables
with 5,558,491.59 5,558,491.59 100.00 uncollectable 4,667,065.27 4,667,065.27
individual
bad debt
131
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Closing Balance Opening Balance
Items Booking Accrual Reason for Booking
Bad debts bad debts
balance rate(%) accrual balance
provision
Total 5,558,491.59 5,558,491.59 4,667,065.27 4,667,065.27
Provision for bad debts by portfolio:
Combined accrual items:
Closing Balance
Items
Other receivables Bad debts Accrual rate(%）
Within 1 year 3,885,989.47 194,299.47 5.00
(including 1year)
1-2 years 3,023,808.31 302,380.83 10.00
2-3 years 841,853.86 168,370.77 20.00
3-4years 281,014.09 140,507.05 50.00
4-5years 71,337.90 57,070.32 80.00
Over 5 years 1,281,362.86 1,281,362.86 100.00
Risk-free portfolio 912,254.08
Provision for bad debts
is made on an 1,249,545.82
individual basis
Total 11,547,166.39 2,143,991.30
（3） Categories of other receivable：
1 st stage 2 nd stage 3 rd stage
Expected Expected Expected
credit loss credit loss credit loss
Provision for bad debt Total
within within life within life
following time time
12 months (unimpaired) (impaired)
Balance on January 1, 2022 7,128,180.77 - - 7,128,180.77
On January 1, 2022
Other receivable carrying
amount on the book
--transfer to 2nd stage
-- transfer to 3rd stage
--reverse to 2nd stage
--reverse to 1st stage
Accrued 580,505.75 580,505.75
Reversed
Recollected
Written off 6,203.63 -6,203.63
Others
132
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Closing Balance 7,702,482.89 7,702,482.89
（4） Provision for bad debts charged off, reversed or recovered during the period
Change during the year
Opening Closing
Category Collected/
balance Accrued Written-off Balance
reversed
Bad debts 7,128,180.77 580,505.75 6,203.63 7,702,482.89
Total 7,128,180.77 580,505.75 6,203.63 7,702,482.89
（5） Other receivable written off in current period
Items written off
Other receivable written off in current period 6,203.63
（6） The categories of other receivable by nature
Nature Closing Balance Opening Balance
Security deposit 7,020,101.19 7,570,216.18
Personal petty cash 1,329,521.48 1,464,007.16
Others 8,756,035.31 8,649,239.76
Total 17,105,657.98 17,683,463.10
（7) Other receivables from the top 5 debtors
closing Rate of other
Company name Category Againg Bad debts
balance receivables
Anhui Conch Cement Co Guarantee 1,300,000.00 within 2 year 7.6 130,000.00
Materials Procurement Office
Guarantee 1,118,900.00 within 2 year 6.54 63,395.00
of Daqin Railway Co.
China Railway Logistics Co. Guarantee 800,000.00 within 2 year 4.68 80,000.00
Wafangdian Bearing Precision Quality
794,027.00 within 1 year 4.64
Forging Co. claims
China Coal Pingshuo Group
Guarantee 557,000.00 within 1 year 3.26 27,850.00
Co.
Total 4,569,927.00 26.72 301,245.00
viii. Inventories
1、Categories of inventories
Closing Balance
Provision for decline in value of
Items inventories / provision for Net book
Book value
impairment of contract performance value
costs
Raw materials 90,477,315.78 11,998,678.48 78,478,637.30
133
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Closing Balance
Provision for decline in value of
Items inventories / provision for Net book
Book value
impairment of contract performance value
costs
Low-value
536,891.65 536,891.65
consumable
Finished goods 972,398.14 972,398.14
Goods on transit 496,719,489.87 77,903,530.66 418,815,959.21
Semi-finished goods 3,041,708.28 3,041,708.28
Total 159,190,692.02 9,542,197.61 149,648,494.41
(Continued)
Closing Balance
Provision for decline in value of
Items inventories / provision for Net book
Book value
impairment of contract performance value
costs
Raw materials 65,513,831.20 14,443,357.39 51,070,473.81
Low-value
507,593.55 507,593.55
consumable
Finished goods
Goods on transit 554,976,127.46 121,372,831.96 433,603,295.50
Semi-finished goods 476,795.20 476,795.20
Total 189,136,443.02 28,175,457.17 160,960,985.85
2 、 Provision for decline in value of inventories and provision for impairment of contract
performance costs
Increase Decrease
Opening Others Closing
Items Reverse/Written
Balance Accrual Other transferr
-off Balance
ed
Raw
14,443,357.39 639,258.73 3,083,937.64 11,998,678.48
materials
Finished
121,372,831.96 14,416,285.49 57,885,586.79 77,903,530.66
goods
Semi-
finished 28,175,457.17 1,062,726.27 19,695,985.83 9,542,197.61
goods
Total 163,991,646.52 16,118,270.49 80,665,510.26 99,444,406.75
134
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ix. Contract assets
1.Contract assets detail
Closing Balance Opening balance
Items Provision Net book Book Provision Net book
Book value
for decline value value for decline value
contract to be
5,858,045.86 292,902.29 5,565,143.57 633,027.20 31,651.36 601,375.84
performed
Total 5,858,045.86 292,902.29 5,565,143.57 633,027.20 31,651.36 601,375.84
2.Disclosure of contract assets categorized by impairment methodology
Closing Balance
Items Booking balance bad debts
Amount Rate (%) Amount Rate Booking value
(%)
Notes receivable with bad debt
provision based on the characters of 5,858,045.86 100 292,902.29 5 5,565,143.57
credit risk portfolio
including:
Contract performance payments 5,858,045.86 100 292,902.29 5 5,565,143.57
Total 5,858,045.86 100 292,902.29 5,565,143.57
(Continued)
Opening Balance
Items Booking balance bad debts Booking
Amount Rate (%) Amount Rate(%) value
Notes receivable with bad debt
provision based on the characters of 633,027.20 100 31,651.36 5 601,375.84
credit risk portfolio
including:
Contract performance payments 633,027.20 100 31,651.36 5 601,375.84
Total 633,027.20 100 31,651.36 601,375.84
Contract assets with bad debt provision based on the characters of credit risk portfolio:
Closing balance
Items
Contract assets Provision for decline Rate (%)
Contract performance payments 5,858,045.86 292,902.29
Total 5,858,045.86 292,902.29
3.Provision for decline of contract assets of current period
Opening Closing
Items Accrual Reverse Written-off
balance Balance
contract to be performed 31,651.36 292,902.29 31,651.36 292,902.29
Total 31,651.36 292,902.29 31,651.36 292,902.29
x. Other current assets
Items Closing Balance Opening Balance
VAT to be verified 29,702,672.39 12,418,324.43
VAT to be deducted 14,421,412.35 3,257,445.02
Advance income tax 3,436,832.45 5,830.38
Total 47,560,917.19 15,681,599.83
135
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xi. Other equity instrument investment
Investments in other equity instruments
Items Closing Balance Opening Balance
Shanghai ME Mechanical & Electrical 2,000,000.00 2,000,000.00
Equipment Chain Co., Ltd
Qian’an Zhayi Iron & Steel Group Co. Ltd 2,486,987.74 2,503,766.95
Dalian Huilong Industry& Trade Company’s share 7,423,089.69 7,423,089.69
Total 11,910,077.43 11,926,856.64
xii. Investment property
Investment property measured as cost method
Land use
Item Property
right Total
1．Initial Cost
（1）Opening Balance 84,454,019.02 52,861,118.81 137,315,137.83
（2） Increase 14,268,584.28 14,268,584.28
—Purchase
—Transferred from FA 14,268,584.28 14,268,584.28
—Increase in business combinations
（3）Decrease 1,795,076.49 1,795,076.49
—Disposal 247,757.37 247,757.37
—Transfer to others 1,547,319.12 1,547,319.12
（4）Closing Balance 96,927,526.81 52,861,118.81 149,788,645.62
2．Accumulated Depreciation
（1）Opening Balance 48,860,526.58 21,242,804.56 70,103,331.14
（2）Opening Balance 11,016,031.61 1,321,511.87 12,337,543.48
—Accrued 11,016,031.61 1,321,511.87 12,337,543.48
—Transfer from others
（3）Decrease 1,266,882.76 1,266,882.76
—Disposal 244,528.27 244,528.27
—Transfer to others 1,022,354.49 1,022,354.49
（4）Closing Balance 58,609,675.43 22,564,316.43 81,173,991.86
3．Impairment Reserve
（1）Opening Balance
（2） Increase
—Accrued
（3）Decrease
—Decrease
（4）Closing Balance
4．Book Value
（1）Closing book value 38,317,851.38 30,296,802.38 68,614,653.76
（2）Opening book value 35,593,492.44 31,618,314.25 67,211,806.69
xiii. Fixed assets
1.1.Fixed assets and fixed assets liquidation
Item Closing Balance Opening Balance
Fixed assets 448,651,044.66 391,769,315.64
Total 448,651,044.66 391,769,315.64
2.Fixed assets detail
136
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Machinery Transportation
Item Property Electronic Device Other Equipment Total
Equipment Equipment
1．Initial Cost
（1）Opening Balance 277,999,210.75 1,005,957,103.34 21,403,612.37 48,062,629.71 220,675,446.76 1,574,098,002.93
（2）Increase 19,108,634.02 85,101,340.59 1,216,629.08 11,775,080.12 47,994,471.57 165,196,155.38
—Purchase 342,693.34 4,353,264.06 395,227.33 2,173,245.78 482,888.07 7,747,318.58
—Transferred from
construction- in-progress 17,218,621.56 43,952,467.31 821,401.75 2,245,170.45 47,511,583.50 111,749,244.57
— Investment real estate
transfer 1,547,319.12 1,547,319.12
— Changes in fixed asset
classes
36,795,609.22 7,356,663.89 44,152,273.11
（3）Decrease 10,336,065.63 29,827,913.96 6,339,558.41 3,526,152.29 38,341,734.79 88,371,425.08
—Disposal 432,323.64 29,827,913.96 146,426.05 3,526,152.29 1,026,119.77 34,958,935.71
—Transfer out to investment 9,260,216.26 9,260,216.26
property
— Changes in fixed asset
643,525.73 6,193,132.36 6,193,132.36 6,193,132.36
classes
（4）Closing Balance 286,771,779.14 1,061,230,529.97 16,280,683.04 56,311,557.54 230,328,183.54 1,650,922,733.23
2.Accumulated
Depreciation
（1）Opening Balance 198,847,353.39 732,582,937.65 16,693,054.45 37,304,780.10 163,740,773.04 1,149,168,898.63
（2）Increase 8,458,612.64 78,263,695.10 857,314.12 8,374,759.92 8,878,148.28 104,832,530.07
—Accrued 7,436,258.15 41,468,085.88 786,210.59 3,027,934.44 8,878,148.28 61,596,637.35
—Transferred from 1,022,354.49
construction- in-progress
— Changes in fixed asset 36,795,609.22 71,103.53 5,346,825.48 42,213,538.23
classes
（3）Decrease 9,192,169.31 29,630,447.70 4,489,678.42 3,411,098.36 38,304,048.13 85,027,441.92
—Disposal 233,280.32 29,630,447.70 142,034.05 3,411,098.36 988,433.11 34,405,293.54
—Transfer out to investment
property
8,408,610.15 8,408,610.15
— Changes in fixed asset
classes
550,278.84 4,347,644.37 37,315,615.02 42,213,538.23
（4）Closing Balance 198,113,796.72 781,216,185.05 13,060,690.15 42,268,441.66 134,314,873.19 1,168,973,986.77
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3．Impairment Reserve
（1） Opening Balance 1,063,718.18 31,389,664.20 17,101.18 575,038.53 114,266.57 33,159,788.66
（2） Increase 51,769.24 12,160.69 7,925.82 54,093.59 33,626.34 159,575.68
—Accrued 51,769.24 12,160.69 7,925.82 54,093.59 33,626.34 159,575.68
（3）Decrease 12,313.11 288.12 9,061.31 21,662.54
—Disposal 12,313.11 288.12 9,061.31 21,662.54
（4）Closing Balance 1,115,487.42 31,389,511.78 25,027.00 628,844.00 138,831.60 33,297,701.80
4．Book value
（1）Closing book value 87,542,495.00 248,624,833.14 3,194,965.89 13,414,271.88 95,874,478.75 448,651,044.66
（ 2 ） Opening book
78,088,139.18 241,984,501.49 4,693,456.74 10,182,811.08 56,820,407.15 391,769,315.64
value
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3.Temporary idle fixed assets
Items Initial Cost Accumulated Provision Book Value
Deprecation
Property 34,491,553.06 30,671,406.90 3,820,146.16
Machinery euipment 84,394,401.55 57,213,587.40 23,119,767.18 4,061,046.97
Transportation equipment 784,016.69 741,428.79 17,101.18 25,486.72
Electronic device 805,541.56 697,921.99 84,825.01 22,794.56
Others equipment 2,186,842.90 1,728,085.80 234,820.61 223,936.49
Total 122,662,355.76 91,052,430.88 23,456,513.98 8,153,410.90
4.Fixed assets lease out under operating lease
Machinery Transportation Electronic Other
Item Property Total
Device Equipment
Equipment Equipment
1．Initial Cost
（ 1 ） Opening
105,564,237.77 227,002,531.20 1,499,980.60 5,942,876.86 2,033,551.36 342,043,177.79
Balance
（2）Increase
—Purchase
—Transferred
from
construction- in-
progress
（3）Decrease
—Disposal 8,636,710.95 75,698,769.76 235,415.19 426,080.81 818,897.91 85,815,874.62
—Others
（ 4 ） Closing
96,927,526.82 151,303,761.44 1,264,565.41 5,516,796.05 1,214,653.45 256,227,303.17
Balance
2.Accumulat
ed
Depreciation
（ 1 ） Opening
63,989,258.85 147,359,119.50 1,298,139.37 4,598,660.07 1,135,688.48 218,380,866.27
Balance
（2）Increase 298,299.83 298,299.83
—Accrued 298,299.83 298,299.83
（3）Decrease 5,379,583.42 43,840,280.75 71,510.95 461,052.17 49,752,427.29
—Disposal
—Other
5,379,583.42 43,840,280.75 71,510.95 461,052.17 49,752,427.29
transfer
（ 4 ） Closing
58,609,675.43 103,518,838.75 1,226,628.42 4,896,959.90 674,636.31 168,926,738.81
Balance
3 ． Impair
ment
Reserve
（ 1 ） Opening
818,737.82 24,687,643.98 17,101.18 202,623.20 5,072.99 25,731,179.17
Balance
（2） Increase
—Accrued
（3）Decrease 818,737.82 19,079,284.32 17,101.18 81,608.38 5,072.99 20,001,804.69
—Disposal
—For personal
818,737.82 19,079,284.32 17,101.18 81,608.38 5,072.99 20,001,804.69
use
（ 4 ） Closing
5,608,359.66 121,014.82 5,729,374.48
Balance
4．Book value
（ 1 ） Closing 38,317,851.39 42,176,563.03 37,936.99 498,821.33 540,017.14 81,571,189.88
book value
（ 2 ） 40,756,241.10 54,955,767.72 184,740.05 1,141,593.59 892,789.89 97,931,132.35
Opening book
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value
5.Fixed assets as pending certificate of ownership
Items Book value Reason
Dalian Wazhou Precision Electric Motor Car Bearing factory 24,886,879.85 In process
WaZhou Liaoyang Bearing Co. New Precision Plant 7,544,705.80 In process
Seven finished products car loading plant 1,993,611.71 In process
xiv. Construction-in-progress
1.Construction in progress and construction materials
Closing Balance Opening Balance
Items Booking provision for Net book Booking provision for Net book
balance impairment value balance impairment value
Construction
44,446,291.93 7,091,322.25 37,354,969.68 88,985,374.41 7,094,234.87 81,891,139.54
in progress
Engineering
materials
Total 44,446,291.93 7,091,322.25 37,354,969.68 88,985,374.41 7,094,234.87 81,891,139.54
2.Construction in progress details
Closing Balance
Item
Book Balance Provision Book Value
Dalian precision automatic assembly line
Precision Bearing Factory Remodeling 1,763,716.80 1,763,716.80
1250 salt bath martensitic heat treatment production
line pressure bed investment transformation
Angular contact ball bearing production line
Bearing Parts Manufacturing Branch Plant Remodeling
Newly built factory building project
Seven finished products remodeling 3,555,799.28 3,453,144.41 102,654.87
Tirenhaus Super Precision Machine
Second finished product remodeling
Plant remodeling project
Liaoyang Remodeling Project
Spherical roller bearing assembly line 1,198,862.55 1,110,842.55 88,020.00
Grinding and machining production line repair and
741,000.00 741,000.00
remodeling
Double push plate type railroad bearing carburizing
production line
Railroad renovation 665,647.85 24,854.40 640,793.45
Super Finishing Machine Installation Project 456,878.68 456,878.68
Overhaul Sub-plant Rehabilitation
Passage II construction project 256,249.27 222,849.70 33,399.57
Crane project
Precision Rolling Body Remodeling 13,091.45 13,091.45
Grinding production line 38,957.26 38,957.26
Computer project 25,623.93 25,623.93
Dalian Industrial Park Project 5,590.45 5,590.45
Equipment to be installed 18,647,555.39 1,081,752.51 17,565,802.88
Workshop Plant Remodeling Project 8,310,795.48 8,310,795.48
Overhaul of very large equipment 5,594,399.60 5,594,399.60
Railroad Bearing Overhaul Branch Railway Bearing
1,035,398.25 1,035,398.25
Automatic Assembly Line and Supporting Project
Medium and Large Branch Component CNC
2,136,725.69 2,136,725.69
Production Line Renewal Project
Total 44,446,291.93 7,091,322.25 37,354,969.68
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(continued)
Opening Balance
Item
Book Balance Provision Book Value
Dalian precision automatic assembly line 12,179,730.00 12,179,730.00
Precision Bearing Factory Remodeling 9,962,216.12 9,962,216.12
1250 salt bath martensitic heat treatment production
9,601,769.92 9,601,769.92
line pressure bed investment transformation
Angular contact ball bearing production line 8,849,557.51 8,849,557.51
Bearing Parts Manufacturing Branch Plant Remodeling 7,835,712.44 7,835,712.44
Newly built factory building project 6,717,773.55 6,717,773.55
Seven finished products remodeling 4,190,539.28 3,735,902.11 454,637.17
Tirenhaus Super Precision Machine 2,123,893.74 2,123,893.74
Second finished product remodeling 1,847,681.42 1,847,681.42
Plant remodeling project 1,470,077.93 1,470,077.93
Liaoyang Remodeling Project 1,426,189.39 1,426,189.39
Spherical roller bearing assembly line 1,321,112.55 1,110,842.55 210,270.00
Grinding and machining production line repair and
741,000.00 741,000.00
remodeling
Double push plate type railroad bearing carburizing
712,389.38 712,389.38
production line
Railroad renovation 625,647.85 24,854.40 600,793.45
Super Finishing Machine Installation Project 456,878.68 456,878.68
Overhaul Sub-plant Rehabilitation 348,672.56 348,672.56
Passage II construction project 259,161.89 225,762.32 33,399.57
Crane project 255,382.52 255,382.52
Precision Rolling Body Remodeling 166,937.61 166,937.61
Grinding production line 38,957.26 38,957.26
Computer project 25,623.93 25,623.93
Dalian Industrial Park Project 5,590.45 5,590.45
Equipment to be installed 9,000,426.10 1,255,873.49 7,744,552.61
Workshop Plant Remodeling Project 8,024,222.21 8,024,222.21
Overhaul of very large equipment
Railroad Bearing Overhaul Branch Railway Bearing
798,230.12 798,230.12
Automatic Assembly Line and Supporting Project
Medium and Large Branch Component CNC
12,179,730.00 12,179,730.00
Production Line Renewal Project
Total
88,985,374.41 7,094,234.87 81,891,139.54
3、Significant construction in progress
Opening Transfer to Other Closing
Items Budget Increase
Balance fixed assets decrease Balance
New Plant Project 7,358,120.12 6,717,773.55 1,638,831.62 8,356,605.17
Dalian Precision
Automatic 14,539,900.00 12,179,730.00 70,796.46 12,250,526.46
Assembly Line
Angular contact ball
bearing production 10,000,000.00 8,849,557.51 1,972,769.50 10,822,327.01
line
1250 heat treatment
salt bath martensitic
production line 15,500,000.00 9,601,769.92 9,601,769.92
investment
remodeling
Precision Bearing
9,962,216.12 4,175,817.99 9,468,368.45 2,905,948.86 1,763,716.80
Factory Remodeling
Equipment to be
9,000,426.10 35,597,704.77 23,953,449.43 1,997,126.05 18,647,555.39
installed
Workshop plant
8,024,222.21 17,058,093.76 9,260,762.34 7,510,758.15 8,310,795.48
remodeling project
Extra large
5,594,399.60 5,594,399.60
equipment overhaul
Total 64,335,695.41 66,108,413.70 83,713,808.78 12,413,833.06 34,316,467.27
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4、Provision for impairment of construction in progress during the period
Opening Change during the year Closing
Items Reason
Balance Accrued transfer out Others Balance
Provision for impairment of
7,094,234.87 2,912.62 7,091,322.25
construction in progress
Total 7,094,234.87 2,912.62 7,091,322.25
xv. Intangible assets
Items Land use right ERP software Total
1．Initial cost
（1）Opening balance 123,328,608.93 11,842,255.70 135,170,864.63
（2）Increase 1,246,641.42 34,905.66 1,281,547.08
— Purchase 1,246,641.42 34,905.66 1,281,547.08
（3） Decrease
—Disposal
（4） Closing balance 124,575,250.35 11,877,161.36 136,452,411.71
2．Amortization
（1）Opening balance 50,856,731.62 6,875,514.30 57,732,245.92
（2）Increase 3,129,037.86 1,271,251.47 4,400,289.33
—Accrual 3,129,037.86 1,271,251.47 4,400,289.33
（3）Decrease
—Disposal
（4）Closing balance 53,985,769.48 8,146,765.77 62,132,535.25
3．Provision for impairment
（1）Opening balance
（2）Increase
—Accrual
（3）Decrease
—Disposal
（4）Closing balance
4．Book value
（1） Closing Book value 70,589,480.87 3,730,395.59 74,319,876.46
（2）Opening Book value 72,471,877.31 4,966,741.40 77,438,618.71
xvi. Long-term unamortized expense
Opening Other Closing
Items Increase Amortization
Balance Decrease Balance
Building improvement 114,379.51 67,830.36 46,549.15
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expenses
Fixed asset improvement
3,570,339.37 268,284.96 3,302,054.41
expenses
Building maintenance
1,542,762.04 48,384.28 1,494,377.76
expenses
Total 114,379.51 5,113,101.41 384,499.60 4,842,981.32
xvii. Deferred tax assets and deferred tax liabilities
1、Deferred tax assets before offsetting
Closing Balance Opening Balance
Items Deferred
Taxable temporary Deferred income Taxable temporary
income tax
differences tax liabilities differences
liabilities
Asset evaluation increment in
business combination without 3,837,980.74 575,697.11 4,179,393.43 626,909.02
the same control
Total 3,837,980.74 575,697.11 4,179,393.43 626,909.02
2、Unrecognized deferred tax assets details
Items Closing Balance Opening Balance
430,976,118.37 406,214,774.41
Deductible temporary difference
805,391,478.16 838,843,796.79
Deductible loss
1,236,367,596.53 1,245,058,571.20
Total
3、Unrecognized deductible loss of deferred tax assets expired next period
Year Closing Balance Opening Balance Memo
2023 96,027,224.19 —
2024 14,645,709.83 14,645,709.83 —
2025 82,495,762.79 82,495,762.79 —
2026 14,116,432.63 14,116,432.63 —
2027 75,136,503.79 75,136,503.79 —
2028 103,469,846.02 103,469,846.02 —
2029 82,648,926.07 82,648,926.07
2030 150,374,473.29 150,374,473.29
2031 127,716,833.64 127,716,833.64
2032 92,212,084.54 92,212,084.54
2033 62,574,905.56
Total 805,391,478.16 838,843,796.79
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xviii. Assets with restricted ownership or use
Closing Balance Opening Balance
Items Book Restricted
Book Balance Book Value Restricted assets Restrictions Book Value Restrictions
Balance assets
Other monetary Bank acceptance Other monetary Bank acceptance
Monetary funds 42,939,828.07 42,939,828.07 75,389,415.51 75,389,415.51
funds deposit funds deposit
Other monetary Letter of Credit Other monetary Letter of Credit
Monetary funds 56,400,000.00 56,400,000.00 28,000,000.00 28,000,000.00
funds Deposit funds Deposit
Other monetary Letter of
Monetary funds 809,839.35 809,839.35
funds Guarantee Deposit
Finance company Trade
Note receivable 2,982,604.41 2,982,604.41 Pledge of notes 20,228,644.00 20,228,644.00 Pledge of notes
acceptance acceptance
Note receivable 14,770,614.03 14,770,614.03 Trade acceptance Pledge of notes
Financing receivable 10,000,000.00 10,000,000.00 Bank acceptance Pledge of notes
Total 127,902,885.86 127,902,885.86 123,618,059.51 123,618,059.51
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xix. Short-term loan
1. Short-term borrowing situation:
Classification Closing balance Opening banalce
Credit loan 598,000,000.00 699,000,000.00
Total 598,000,000.00 699,000,000.00
xx. Note payable
Classification Closing balance Opening balance
Bank acceptance notes 178,010,089.72 322,446,562.00
Bank letter of credit 282,218,015.20 140,000,000.00
Trade acceptancenotes 612,113.60
Total 460,840,218.52 462,446,562.00
xxi. Accounts payable
1. Accounts payable
Items Closing balance Opening balance
Goods payments 1,203,819,196.29 1,266,080,898.13
Project payments 61,341,461.77 30,528,086.00
Others 4,039,611.42 4,366,050.59
Total 1,269,200,269.48 1,300,975,034.72
xxii. Contract liability
1. Details
Items Closing balance Opening balance
Contract obligation to be fulfilled 30,546,735.85 30,449,983.07
Total 30,546,735.85 30,449,983.07
xxiii. Employee’s payable
1. Category of employee’s payables
Opening
Items Increase Decrease Closing balance
balance
1. Short-term employee’s
40,889,276.33 346,106,630.93 344,617,432.03 42,378,475.23
payable
2.Post-employment benefit
5,431,700.50 37,572,539.05 38,288,461.88 4,715,777.67
–defined contribution plan
3. Redundancy pay 476,327.00 707,248.00 1,147,689.00 35,886.00
Total 46,797,303.83 384,386,417.98 384,053,582.91 47,130,138.90
2. Short-term employee’s payables
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Opening
Items Increase Decrease Closing balance
balance
1.Salaries,bonus, allowance, and
35,350,531.29 267,844,487.05 265,639,542.49 37,555,475.85
subsidy
2. Welfare 1,698,260.88 22,503,415.26 22,512,308.03 1,689,368.11
3. Social insurance 510.00 24,070,104.29 24,049,139.71 21,474.58
Include: Medical insurance 510.00 18,951,225.91 18,930,881.41 20,854.50
On-duty injury insurance 2,941,476.95 2,940,856.87 620.08
Maternity insurance 2,177,401.43 2,177,401.43
4. Housing funds 2,723,387.67 28,733,167.44 28,808,651.12 2,647,903.99
5. Labour union and training
1,116,586.49 2,955,456.89 3,607,790.68 464,252.70
expense
Total 40,889,276.33 346,106,630.93 344,617,432.03 42,378,475.23
3. Defined contribution plan
Opening Closing
Items Increase Decrease
balance balance
1. Pension 5,361,841.68 36,437,339.06 37,154,322.19 4,644,858.55
2. Unemployment insurance 69,858.82 1,135,199.99 1,134,139.69 70,919.12
Total 5,431,700.50 37,572,539.05 38,288,461.88 4,715,777.67
xxiv. Tax payables
Item Closing balance Opening balance
Value-added tax 17,442,505.31 22,583,213.56
Vehicle and vessel tax 523.35 277.11
Individual income tax 179,264.27 151,164.11
City maintenance and construction tax 380,958.28 905,007.18
Real estate tax 729,276.40 761,554.52
Land Value Added Tax 79,628.63
Education surcharge 144,555.47 611,185.48
Land use tax 533,535.19 608,428.81
local education surcharge 125,323.46 23,861.56
Stamp duty 712,277.64 822,501.62
Total 20,327,848.00 26,467,193.95
xxv. Other payables
Items Closing balance Opening balance
Other payables 185,396,158.28 180,459,153.26
Total 185,396,158.28 180,459,153.26
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1. Other accounts payable
（1）Other payables categorized by payments nature
Payments nature Closing balance Opening balance
Bid security deposits 2,180,298.75 744,408.75
Trademark fees and lease premium to
35,122,060.78 29,201,965.04
Group
Authorization deposit of seller 95,780,977.48 85,246,975.76
Others 52,312,821.27 65,265,803.71
Total 185,396,158.28 180,459,153.26
xxvi. Other current liabilities
Items Closing balance Opening balance
Output VAT to be transferred 4,574,730.79 4,294,078.63
Total 4,574,730.79 4,294,078.63
xxvii. Long-term Borrowings
Items Closing balance Opening balance
Credit borrowing 99,450,000.00
Total 99,450,000.00
xxviii. Long-term payables
Type Closing balance Opening balance
Long-term payables 100,000.00 100,000.00
Special payables 244,974.84 244,974.84
Total 344,974.84 344,974.84
1. Long-term payables
Payments nature Closing balance Opening balance
Equipment payments 100,000.00 100,000.00
Total 100,000.00 100,000.00
2. Special payables
Opening Closing
Items Increase Decrease Formation Basis
Balance Balance
Granted by Wafangdian Bureau of
Special pollution Finance and Wafangdian Bureau of
169,974.84 169,974.84
treatment Environment Protection with approval
with “WaCaiZhiQi No.[2004]217”
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Dalian Financial Bureau and
Municipal Office of Economic and
Informatization Information Technology Committee
75,000.00 75,000.00
construction with approval with “Da CaiZhiQi No.
[2012]917” and “DaJing XinFa No.
[2012]199”
Total 244,974.84 244,974.84
xxix. Projected liability
Opening Closing
Items Increase Decrease Reason
balance balance
Accrual for wind
Accrued warranty 829,233.94 5,821,814.18 5,042,042.88 1,609,005.24 power product
quality claim
Customer claimed
Wind power product
53,459,700.00 3,505,223.17 13,212,885.40 43,752,037.77 compensation for
quality claim
quality problem
Railroad Bearing Bearing Overhaul
Overhaul Business Compensates
4,237,159.65 4,237,159.65
Compensates Customers for
Customers for Losses Losses
Total 54,288,933.94 13,564,197.00 18,254,928.28 49,598,202.66
xxx. Deferred income
Opening Closing
Items Increase Decrease Formation Basis
balance balance
Government
23,668,478.95 205,869.15 4,476,942.29 19,397,405.80
Grant from government
subsidy
Old factory removal and
new factory and land
Compensation for
24,656,000.19 953,225.60 23,702,774.60
compensation for Liaoyang
land removal
Bearing Construction
Co.,Ltd
48,324,479.14 205,869.15 5,430,167.89 43,100,180.40
Total
xxxi. Share capital
Change forcurrent period
Transferring
Shareholders’ Opening Issuing Closing
Distributing capital
name/category Balance new Others Subtotal Balance
shares reservesto
shares
sharecapital
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Shares under
restriction for
sale
Domestically
legal person 244,000,000.00 244,000,000.00
shares
Total shares
under
244,000,000.00 244,000,000.00
restriction for
sale
Shares without
restriction for
sale
Domestically
listed foreign 158,600,000.00 158,600,000.00
shares
Total shares
without
158,600,000.00 158,600,000.00
restriction for
sale
Total shares 402,600,000.00 - 402,600,000.00
xxxii. Capital Reserve
Items Opening balance Increase Decrease Closing balance
Share premium 201,956,446.52 201,956,446.52
Other capital reserves 283,734,603.95 283,734,603.95
Total 485,691,050.47 485,691,050.47
xxxiii. Special reserve
Items Opening balance Increase Decrease Closing balance
Safety production fee 1,933,209.86 14,207,667.88 13,726,000.11 2,414,877.63
Total 1,933,209.86 14,207,667.88 13,726,000.11 2,414,877.63
xxxiv. Surplus reserves
Items Opening balance Increase Decrease Closing balance
Statutory surplus
116,179,772. 10 116,179,772. 10
reserve
Discretionary surplus
20,590,618.91 20,590,618.91
reserve
Total 136,770,391.01 136,770,391.01
xxxv. Undistributed profits
Item Current year Prior year
Closing balance of prior year -416,794,159.01 -211,056,473.59
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Add: Adjustments to the opening balance of
-
undistributed profits
Including: additional retrospective adjustments according
to the new accounting standards -
Change on accounting policy -
Correction of prior period significant errors -
Change on combination scope under same control -
Other factors -
Opening balance of current year -416,794,159.01 -211,056,473.59
Add: net profit attributable to shareholders of parent
-139,897,498.87 -205,737,685.42
company in the year
Less: Provision for statutory surplus reserves -
Provision for any surplus reservesC -
Provision of general risk -
Dividends payable for common shares -
Share dividends -
Closing balance of current year -556,691,657.88 -416,794,159.01
xxxvi. Operating revenue and cost
1. Operating revenue and cost
Current year Prior year
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Revenue from principle 2,093,582,371.38 1,772,353,109.74 2,105,718,679.43 1,715,532,617.22
operation
Revenue from other 99,691,310.82 48,356,855.55 242,611,882.14 182,374,798.19
operation
Total 2,193,273,682.20 1,820,709,965.29 2,348,330,561.57 1,897,907,415.41
2. Revenue from principle operation details
Current year Prior year
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
Items Sales revenue Cost of sales Sales revenue Cost of sales
Export 180,093,365.40 162,756,753.10 216,679,504.65 204,095,685.61
Domestic 1,839,041,606.47 1,560,781,777.11 1,829,007,604.84 1,450,154,222.68
Including:
Transportation vehicle 390,584,082.35 342,540,976.43 408,899,268.24 308,496,639.53
bearings
Special use bearings 797,640,051.38 612,926,045.89 766,000,221.77 587,952,935.71
General use bearings 650,817,472.74 605,314,754.79 654,108,114.83 553,704,647.44
Industrial Operations 74,447,399.51 48,814,579.53 60,031,569.94 61,282,708.93
Total 2,093,582,371.38 1,772,353,109.74 2,105,718,679.43 1,715,532,617.22
xxxvii. Taxes and surcharges
Items Current year Prior year
City construction tax 2,971,995.83 2,295,223.89
Education surcharge 1,250,772.70 975,487.12
Local Education surcharge 852,244.05 650,324.75
Stamp duty 2,913,780.62 2,986,079.48
Property tax 3,186,145.79 3,234,052.32
Tax on land use 2,750,658.28 2,592,538.39
Others 13,334.65 3,828.75
Total 13,938,931.92 12,737,534.70
xxxviii. Selling expenses
Items Current period Previous period
Employee benefit 75,860,278.63 80,232,961.93
Compensation for quality default 6,177,806.01 15,147,919.63
Transportation expense 3,709,993.80 3,861,365.52
Travel expense 19,759,828.73 19,576,148.62
Trademark use fee 19,540,783.38 19,059,025.84
Business activity 21,253,511.98 10,559,616.69
Leasing 665,324.40 2,534,638.96
Conference expense 1,786,663.26 434,107.43
Others 11,016,727.12 11,132,179.76
Total 159,770,917.31 162,537,964.38
xxxix. Administrative expenses
Items Current year Prior year
Employee benefit 104,663,763.07 92,568,569.30
Intangible assets amortization 4,436,782.70 5,184,998.40
Guide and fire fighting expense 2,776,700.02 2,064,799.94
151
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Depreciation expense 3,976,081.49 5,647,387.71
Travel expense 3,737,729.34 1,694,654.96
Business entertaining expense 410,823.18 86,907.86
Other expense 7,605,198.79 7,852,328.83
Total 127,607,078.59 115,099,647.00
xl. R&D expenses
Items Current year Prior year
Materials input 112,308,644.43 182,464,582.97
Design, new process development fee 21,227,451.57 17,068,312.85
Labor cost 16,158,279.14 7,860,803.17
Depreciation and amortization of long term expense 2,116,871.69 13,837,137.30
Fuel power 2,845,982.54 2,795,182.25
R&D equipment repair and leasing fee 830,561.34 1,728,751.60
Processing fee 71,405.34 4,156,235.94
Testing fee 1,284,691.44 150,000.00
Others fee 992,493.16 1,184,324.90
Total 157,836,380.65 231,245,330.98
xli. Financial expenses
Items Current year Prior year
Interest expenses 40,071,255.06 36,216,652.32
Less: Interest income 1,532,778.11 1,197,047.65
Exchange losses -2,879,743.90 -4,577,289.79
Add: Others expenditure 481,611.16 965,156.99
Total 36,140,344.21 31,407,471.87
xlii. Other income
Items Current year Prior year
Government grant 10,623,570.13 7,068,347.57
Input tax credits 22,781,130.77
Withholding of personal income tax handling fee 86,065.72
Total 33,490,766.62 7,068,347.57
xliii. Investment income
Items Current year Prior year
Dividend income from other equity instrument
2,000,000.00
investments during the holding period
Debt restructuring 10,935,641.78 6,892,627.00
Total 12,935,641.78 6,892,627.00
xliv. Gain on FV movement
Source of Gain on FV change Current year Prior year
Tradable financial asset -29,276.17 -78,583.43
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Total -29,276.17 -78,583.43
xlv. Loss on credit impairment (loss listed as “-”)
Items Current year Prior year
Bad debt loss of notes receivable 121,925.22 -1,301,852.54
Bad debt loss of receivable -7,732,014.97 13,483,629.05
Bad debt loss of other receivable -580,505.75 1,967,408 54
Total -8,190,595.50 14,149,185.05
xlvi. Loss on asset impairment (loss listed as “-”)
Items Current year Prior year
Inventory impairment loss & Impairment loss on -16,118,270.49 -54,398,890.99
contract performance costs
Contract asset impairment loss -292,902.29 -31,651.36
Fixed asset impairment loss -159,575.68 -14,019,262.53
Construction in progress loss -2,312,921.14
Total -16,570,748.46 -70,762,726.02
xlvii. Gain on assets disposal
Amounts recognized into current
Item Current year Prior year
non-recurring profit or loss
Gain on non-current assets disposal 1,406,119.64 2,110,473.61 1,406,119.64
Total 1,406,119.64 2,110,473.61 1,406,119.64
xlviii. Non-operating income
1. Non-operating income list
Amounts recognized into current
Item Current year Prior year
non-recurring profit or loss
Penalty income 303,323.42 2,877,785.15 303,323.42
Written off unsettled payable 236,575.70 1,023,075.78 236,575.70
Gains on destruction and retirement
512.39 512.39
of non-current assets
Others 62,904.93 27,106.90 62,904.93
Total 603,316.44 3,927,967.83 603,316.44
xlix. Non-operating expenses
Amounts recognized into current
Item Current year Prior year non-recurring profit or loss
244,960.00
Public beneficial donation
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Wafangdian Bearing Co., Ltd. 2023 annual report full text
291,140.93 279,322.28 291,140.93
Loss on disposal of non- current
asset scrapped
129,153.50 123,972.75 129,153.50
Penalty loss
24,799.14 8,060.11 24,799.14
Others
445,093.57 656,315.14 445,093.57
Total
l. Income tax expense
1. Income tax expense breakdown
Items Current year Prior year
Current income tax expenses
Deferred income tax expenses -51,211.91 -56,327.43
Total -51,211.91 -56,327.43
2.Accounting profit and income tax expense adjustment process
Items Current year
-99,529,804.99
Total profit
-14,929,470.75
Income tax expense at the statutory [or applicable] tax rate
-4,852,070.53
Effect of different tax rates applied to subsidiaries
Effect of adjustments to income taxes of prior periods
-344,943.45
Impact of non-taxable income
209,998.35
Effect of non-deductible costs, expenses and losses
Effect of deductible losses on the use of deferred income tax assets not recognized
in prior periods
Effect of deductible temporary differences or deductible losses on deferred income 25,569,673.10
tax assets not recognized in the period
-5,704,398.63
Other (additive deductions)
-51,211.91
Income tax expense
li. Earnings per share
1.Basic earnings per share
Basic earnings per share is calculated by dividing consolidated net income attributable to
ordinary shareholders of the parent by the weighted average number of ordinary shares of
the Company in issue:
Items Current period Previous period
Consolidated net income attributable to
-99,478,593.08 -139,897,498.87
ordinary shareholders of the parent
Weighted average number of common shares
402,600,000.00 402,600,000.00
of the Company issued and outstanding
154
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Basic earnings per share -0.25 -0.35
Include: Basic earnings per share from
-0.25 -0.35
continuing operations
Basic earnings per share from discontinued
operations
2.Diluted earnings per share
Diluted earnings per share is calculated by dividing the consolidated net income
attributable to ordinary shareholders of the parent (diluted) by the weighted average
number of ordinary shares of the Company in issue (diluted)
Current Previous
Items
period period
Consolidated net income attributable to ordinary shareholders of the
-99,478,593.08 -139,897,498.87
parent (diluted)
Weighted average number of common shares of the Company issued and
402,600,000.00 402,600,000.00
outstanding (diluted)
Diluted earnings per share -0.25 -0.35
Include: Diluted earnings per share from continuing operations -0.25 -0.35
Diluted earnings per share from discontinued operations
lii. Notes on Cash Flow
1. Cash related to operating activities
(1) . Other cash received in connection with operating activities
Items Current period Previous period
Interest income 930,938.31 160,520.69
Government Grants 4,502,681.93 1,135,700.85
Current payments 19,680,468.66 25,104,985.62
Refund of deposits and reserve funds 31,095.23 1,526,175.87
Others 9,636,711.88 16,430,341.88
Total 34,781,896.01 44,357,724.91
(2) Other cash paid in connection with operating activities
Items Current period Previous period
Selling expenses 42,765,692.93 43,467,830.64
Administrative costs 40,560,213.64 38,974,117.03
Financial expenses 5,726,394.12 2,239,823.14
Others 50,624,735.67 58,415,936.42
Total 139,677,036.36 143,097,707.23
2. Cash related to financing activities
(1) Other cash received in connection with financing activities
Items Current period Previous period
Note Discounting 499,694,933.95 148,898,875.78
Recovery of deposits due 14,500,000.00
Total 514,194,933.95 148,898,875.78
(2) Other cash paid in connection with financing activities
Items Current period Previous period
Notes due for payment 432,726,848.20
155
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Deposit 246,315,745.49 199,211,995.47
Total 679,042,593.69 199,211,995.47
(3) Changes in liabilities arising from financing activities
Increase Decrease
Items Opening balance Non-cash Non-cash Closing balance
Cash movements Cash movements
movements movements
Short term
699,000,000.00 748,000,000.00 849,000,000.00 598,000,000.00
loan
Long term
100,000,000.00 550,000.00 99,450,000.00
loan
liii. Notes on Cash Flow Statement Items
1. Supplementary Information on Cash Flow Statement
additional materials Current period Previous period
1. Adjust net profit to cash flow from operating
activities:
Net profit -99,478,593.08 -139,897,498.87
Add: Provision for asset impairment 8,190,595.50 -14,149,185.05
Credit asset impairment loss 16,570,748.46 70,762,726.02
Depreciation of fixed assets 61,747,539.66 82,180,235.85
Amortization of intangible assets 4,400,289.33 3,863,486.53
Amortization of long-term deferred expenses
Losses on disposal of fixed assets, intangible assets and
-1,406,119.64 -2,110,473.61
other long-term assets
Loss from scrapped fixed assets 291,140.93 279,322.28
Loss from changes in fair value 29,276.17 78,583.43
Financial expenses 36,140,344.21 31,407,471.87
Investment loss -12,935,641.78 -6,892,627.00
Decrease in deferred income tax assets
Increase in deferred income tax liabilities -51,211.91 -56,327.43
Inventory reduction 59,672,294.69 59,703,097.70
Decrease in operating receivables 80,095,716.44 -88,903,900.28
Increase in operating payables -68,943,686.83 88,000,638.46
Other
Net cash flow from operating activities 84,322,692.15 84,265,549.90
2. Major investment and financing activities that do
not involve cash receipts and expenditures:
Conversion of debt into capital
Convertible corporate bonds due within one year
Financing lease of fixed assets
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additional materials Current period Previous period
3. Net changes in cash and cash equivalents:
Year-end balance of cash 110,664,560.63 227,357,291.37
Less: cash balance at the beginning of the year 227,357,291.37 209,847,896.42
Plus: the year-end balance of cash equivalents
Less: the beginning balance of cash equivalents
Net increase in cash and cash equivalents -116,692,730.74 17,509,394.95
2.Cash and cash equivalents
Items Closing balance Opening balance
1. Cash 110,664,560.63 227,357,291.37
Including: cash on hand 292.91
Bank deposits that can be used for payment at any time
Other currency funds that can be used for payment at any time 110,664,560.63 227,356,998.46
2. Cash equivalents
Of which: bond investments due within three months
3. Balance of cash and cash equivalents at the end of the year 110,664,560.63 227,357,291.37
Among them: the restricted use of cash and cash equivalents
by the parent company or subsidiary within the group
liv. Foreign currency monetary items
Converted Closing balance
Items Closing balance
exchange rate converted CNY
Money funds 41,500,073.57
Include：USD 3,592,075.05 7.0827 25,441,589.96
Euro 2,043,272.04 7.8592 16,058,483.62
Accounts Receivable 14,070,748.81
Include：USD 1,649,693.46 7.0827 11,684,283.87
Euro 303,652.40 7.8592 2,386,464.94
lv. Leases
1. As lessee
Items Current period Previous period
Simplified treatment of short-term lease charges
recognized in the cost of the related asset or in current 18,503,295.33 18,573,716.43
profit or loss
2. As lessor
(1) Operating lease
Items Current period Previous period
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Items Current period Previous period
Operating lease income 20,273,010.89 25,755,096.14
Of which: Income related to variable lease payments
not included in lease receipts
VIII. Research and development expenditure
Items Current period Previous period
Material inputs 112,308,644.43 182,464,582.97
Technical service fee, design fee, new process protocol
development fee (equipment commissioning fee and 21,227,451.57 17,068,312.85
new product tooling)
Labor costs 16,158,279.14 7,860,803.17
Depreciation and amortization of long-term expenses 2,116,871.69 13,837,137.30
Fuel and power 2,845,982.54 2,795,182.25
R&D equipment repair and rental fees 830,561.34 1,728,751.60
Processing costs 71,405.34 4,156,235.94
Testing costs 1,284,691.44 150,000.00
Other expenses 992,493.16 1,184,324.90
Total 157,836,380.65 231,245,330.98
Of which: Expensed R&D expenditures 157,836,380.65 231,245,330.98
Capitalized R&D expenses
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IX. Interest in other entity
1. Equity of subsidiaries
(1) Organization structure of group company
Principal place of Shareholding (%)
Name of Subsidiary Registered capital Place of Registration Business Nature Acquisition method
business
Direct Indirect
Wangshuitai Street, Manufacture and sale
Wazhou Liaoyang Bearing 19.35 million Liaoyang City,
Taizihe District, of bearings and 100 Business Merger
Manufacturing Co. dollars Liaoning Province
Liaoyang City, China machinery
No.12, Yongsheng
Manufacture and sale
Dalian Wazhou Precision Dalian, Liaoning Street, Thirteen Mile, Investment and
10 million dollars of bearings and 100
Motor Bearing Co. Province Dalian Free Trade establishment
machinery
Zone
Wazhou Precision Spherical No.1, Section 1, North Manufacture and sale
Wafangdian, Liaoning
Roller Bearing (Wafangdian) 194 million dollars Gongji Street, of bearings and 100 Business combination
Province
Co. Wafangdian machinery
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X. Government Grants
i. Government grants recognized in profit or loss
(1) Asset-related government grants
Balance sheet Amounts recognized in profit or loss Items recognized
Amount
presentation Current period Previous period in profit or loss
Deferred income 109,604,063.31 5,430,167.88 5,809,136.96 Other gains
Total 109,604,063.31 5,430,167.88 5,809,136.96
(2) Revenue-related government grants
Amounts recognized in profit or loss
Items Amount
Current period Previous period
Subsidies for stabilizing jobs 1,254,878.14 182,460.53 1,072,417.61
Project Funding for Special Funds for Dalian
2,420,000.00 2,420,000.00
Manufacturing Innovation Center
Dalian Science and Technology Bureau Key
R&D 2022 Interim Acceptance Subsidy 1,134,700.00 1,134,700.00
Funding
Dalian Allocation of R&D Post-subsidy
1,000,000.00 1,000,000.00
Funds
Dalian Bureau of Commerce allocated 2021
295,106.03 295,106.03
open fund allocation
Special Funds for Digital Liaoning and Smart
200,000.00 200,000.00
Manufacturing Province
Subsidies for work-based training 47,690.00 47,690.00
Others 151,128.98 12,026.04 139,102.94
Total 6,503,503.15 5,244,292.60 1,259,210.55
160
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ii. Liability items involving government grants
Recognized
Asset-
Liability Opening in non- Transferred to Charged Other Closing
New grants related/revenue-
items Balance operating other gains to costs changes Balance
related
income
Deferred
48,324,479.14 205,869.15 5,430,167.89 43,100,180.40 Asset-related
income
XI. Risk Related to Financial Instruments
i. Types of risks arising from financial instruments
The Company is exposed to a variety of financial risks in the course of its operations:
credit risk, liquidity risk and market risk (including exchange rate risk, interest rate risk
and other price risks).
1. Credit risk
Credit risk is the risk that the counterparty will fail to fulfill its contractual obligations and
cause the Company to incur a financial loss.
The carrying amount of recognized financial assets in the consolidated balance sheet; for
financial instruments measured at fair value, the carrying amount reflects the risk exposure,
but not the maximum risk exposure, which will change with future changes in fair value.
In order to reduce credit risk, the Group has set up a special department to determine credit
limits, conduct credit approvals and perform other
The Group has established a special department to determine credit limits, conduct credit
approvals and implement other monitoring procedures to ensure that necessary measures
are taken to recover overdue claims. In addition, the Group reviews the collection status of
each individual receivable at each balance sheet date to ensure that adequate provision for
bad debts is made for uncollectible amounts. As a result, the management of the Group
considers that the Group's exposure to credit risk is significantly reduced.
The Group's liquidity is placed with banks with high credit ratings, therefore, the credit risk
of liquidity is low.
The Group has adopted necessary policies to ensure that all sales customers have good
credit history. Except for the accounts receivable amount
The Group has no other significant credit concentration risk except for the top five
amounts of accounts receivable.
161
Wafangdian Bearing Co., Ltd. 2023 annual report full text
The total amount of the top five accounts receivable: RMB314 million.IX. Fair value
disclosures.
2. Liquidity risk
Liquidity risk is the risk that an enterprise will experience a shortage of funds to meet its
obligations that are settled by delivery of cash or other financial assets.
The Group manages liquidity risk by ensuring that there is sufficient liquidity to meet
obligations as they fall due without incurring unacceptable losses or causing damage to the
enterprise's reputation. The Group regularly analyzes the structure and maturity of its
liabilities to ensure adequate funding. The management of the Group monitors the
utilization of bank borrowings and ensures compliance with the borrowing agreements. It
also negotiates with financial institutions for financing in order to maintain a certain credit
line and minimize liquidity risk.
The undiscounted contractual cash flows of each of the Company's financial liabilities by
maturity date are set out below:
Closing Balance
Total
items Over
Immediate 2-5 undiscounted
Within1 year 1-2 years 5 Book value
reimbursement years contract
years
amount
Short-term
598,000,000.00 598,000,000.00 598,000,000.00
loans
Notes payable 460,840,218.52 460,840,218.52 460,840,218.52
Long-term
99,450,000.00 99,450,000.00 99,450,000.00
loans
Total 1,058,840,218.52 99,450,000.00 1,158,290,218.52 1,158,290,218.52
Opening Balance
items 1-2 2-5 Over Total
Immediate
reimbursement
Within1 year years years 5 undiscounted Book value
years contract amount
Short-
term 699,000,000.00 699,000,000.00 699,000,000.00
loans
Notes
462,446,562.00 462,446,562.00 462,446,562.00
payable
Total 1,161,446,562.00 1,161,446,562.00 1,161,446,562.00
3. Market risk
Market risk of a financial instrument is the risk that the fair value or future cash flows of
the financial instrument will fluctuate because of changes in market prices, including
exchange rate risk, interest rate risk and other price risks.
162
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(1) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument
will fluctuate because of changes in market interest rates.
The Group's risk of changes in cash flows from financial instruments due to changes in
interest rates relates mainly to variable-rate bank borrowings. The Group's policy is to
maintain floating interest rates on these borrowings.
(2) Exchange rate risk
Exchange rate risk is the risk that the fair value or future cash flows of a financial
instrument will fluctuate because of changes in foreign exchange rates.
The Group's exposure to foreign exchange risk relates primarily to the U.S. dollar, and the
Group's major export operations are settled in U.S. dollars. As at December 31, 2023,
except for the balances of monetary items in foreign currencies in this Note V. (54), the
Group's assets and liabilities were in RMB. The foreign exchange risk arising from these
assets and liabilities with foreign currency balances may have an impact on the Group's
results of operations.
The Company's exposure to exchange rate risk mainly arises from financial assets and
financial liabilities denominated in U.S. dollars, and the amounts of foreign-currency
financial assets and foreign-currency financial liabilities translated into Renminbi are set
out below:
Closing Balance Opening Balance
Other Other
items
US dollar foreign Total US dollar foreign Total
currency currency
Currency funds 25,441,589.96 16,058,483.62 41,500,073.57 40,360,595.18 16,970,554.13 57,331,149.31
Accounts
11,684,283.87 2,386,464.94 14,070,748.81 6,119,680.29 1,346,740.61 7,466,420.90
receivable
Total 37,125,873.83 18,444,948.56 55,570,822.38 46,480,275.47 18,317,294.74 64,797,570.20
(3) Other price risks
As of December 31, 2023, the Group's purchased bearing components may be subject to
price fluctuations.
Other price risk is the risk that the fair value or future cash flows of a financial instrument
will fluctuate because of changes in market prices other than exchange rate risk and
163
Wafangdian Bearing Co., Ltd. 2023 annual report full text
interest rate risk.
ii. Transfer of financial assets
1.ransfers of financial assets
Method of transferring Transferred financial assets Basis of
Status
financial assets Nature Amount judgment
Notes endorsed and outstanding Bank acceptance 302,155,516.10 Non-derecognition
Finance company
Notes endorsed and outstanding 12,011,143.08 Non-derecognition
acceptance
Notes endorsed and outstanding Trade acceptance 43,099,544.33 Non-derecognition
Total 357,266,203.51
2.Financial assets derecognized due to transfers
Modalities for the transfer Associated gains or
items Amount
of financial assets losses
Receivables financing 356,497,666.90
Total 356,497,666.90
XII. Fair value disclosures
The inputs used in fair value measurements are divided into three levels:
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or
liabilities that are available at the measurement date.
Level 2 inputs are inputs other than Level 1 inputs that are directly or indirectly observable
for the related asset or liability.
Level 3 inputs are unobservable inputs for the relevant asset or liability.
The level to which the fair value measurement results belong is determined by the lowest
level to which the inputs that are significant to the fair value measurement as a whole
belong.
i. Closing fair value of assets and liabilities measured at fair value
F V at the year end
items 1st Level FV 2nd Level FV 3rd Level FV
Total
Measurement Measurement Measurement
I. Continuously measured at FV
◆Tradable financial asset 214,178.33 214,178.33
1.Financial assets at fair value through profit
214,178.33 214,178.33
or loss
（1）Equity instrument investment 214,178.33 214,178.33
◆Receivables financing 55,546,474.87 55,546,474.87
Total assets measured at fair value on an
214,178.33 55,546,474.87 55,760,653.20
ongoing basis
164
Wafangdian Bearing Co., Ltd. 2023 annual report full text
ii. Basis for determining the market value of continuing and discontinued Level 1
fair value measurement items
The Group obtains the unadjusted closing price on the public stock exchange at December
31, 2023 for its investment in certain equity instruments included in financial assets held
for trading.
XIII .Related Parties Relationship and Transactions
i. Status of the Wafangdian Bearing Company Limited's parent company
Registered Registered
Parent Shareholding Voting power
Business nature
company address
capital percentage percentage
No. 1 North Manufacture and
Wazhou Gongji Street, sales of bearing
519,869,400. 60.61 60.61
Group Wafangdian 00
and other
City, Dalian
equipment
ii. Status of the Company's subsidiaries
For details of the Company's subsidiaries, please refer to "VIII. Interests in other entities"
in this note.
iii. Other related parties
Name of related party Related party relationship
Dalian Wazhou Bearing Manufacturing Equipment Co., Ltd Other entity controlled by the same parent
company and ultimate controlling party
Other entity controlled by the same parent
Wazhou Exact Forge Co., Ltd
company and ultimate controlling party
Wazhou Group Precision Turnplate Bearing Co., Ltd Other entity controlled by the same parent
company and ultimate controlling party
Wazhou Group Exact Transmission Bearing Co., Ltd Other entity controlled by the same parent
company and ultimate controlling party
Wazhou Group Special Precision Bearing Co. , Ltd. Other entity controlled by the same parent
company and ultimate controlling party
Liaoning North Metal Materials Supply Chain Co., Ltd Other entity controlled by the same parent
company and ultimate controlling party
Other entity controlled by the same parent
Wazhou Group (USA) Bearing Co., Ltd.
company and ultimate controlling party
165
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Other entity controlled by the same parent
Wazhou Group High-End Auto Bearing Co.,Ltd
company and ultimate controlling party
Other entity controlled by the same parent
Wazhou Group Precision Roller Co.,Ltd
company and ultimate controlling party
Other entity controlled by the same parent
Wazhou Group Precision Retainer Co.,Ltd
company and ultimate controlling party
Other entity controlled by the same parent
Kugel- und Rollenlagerwerk Leipzig GmbH
company and ultimate controlling party
Wafangdian Bearing Power Co.,Ltd Other entity controlled by the same parent
Wazhou Group National Bearing Engineering Technology Other entity controlled by the same parent
Research Centre Co.,Ltd
Wafangdian Bearing Group Dalian Wind Power Spindle Other entity controlled by the same parent
Bearing Co.
Wafangdian Bearing Group Shanghai R&D Center Co. Other entity controlled by the same parent
Waxaxhaft Group (Europe) Bearing Co. Other entity controlled by the same parent
Dalian Wazhou Jinzhou Machinery Co., Ltd Ceases to be a related party in 2023
Wafangdian Tongda Bearing Manufacturing Co., Ltd
Other related party
Dalian WazhouFengyuan Machinery Co., Ltd Cease to be an associated party after September
2023
ZWZ Bearing Europe GmbH Other related party
Dalian koyo Wazhou shaft auto bearing co., Ltd
Other related party
Wafangdian Bearing Education and Training Center
Other related party
Dalian Tiye Gikai Wax Shaft Industry Co., Ltd
Other related party
Wafangdian Bearing Hospital Cease to be an associated party after November
2023
Dalian Heavy Industries Crane Group Co.
Other related party
iv. Related party transactions
1. Purchase and sale of goods, provision and acceptance of labor related transactions
(1) Purchase of goods, provide, and receive labour services
Contents of related
Related Party current year prior year
transactions
Purchase of goods and
Wafangdian Bearing Group Co. equipment and lease of 212,860,871.10 393,790,502.66
tangible assets
Wafangdian Bearing Precision Forging Purchase of goods and
431,442,008.76 267,204,511.61
Co. equipment
Wafangdian Bearing Group Precision
Purchase of goods 32,332,151.84 41,439,350.46
Rolling Body Co.
166
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wafangdian Bearing Group High-end
Purchase of goods 262,590.26 70,167,080.09
Automobile Bearing Co.
Wafangdian Bearing Group Precision
Purchase of goods 143,138,262.93 167,849,331.81
Retainer Co.
Dalian Wazhou Jinzhou Machinery Co.. Purchase of goods.
19,408,857.28
Ltd
Dalian Wazhou Group Bearing
Purchase of goods 1,827,042.37 17,863,540.42
Equipment Manufacturing Co.
Dalian Wazhou Group Bearing
Purchase of equipment 2,197,787.61
Equipment Manufacturing Co.
Wafangdian Bearing Power Co. Remodeling 5,046,278.07 1,410,483.03
Wafangdian Bearing Power Co. Purchase of land 1,208,571.43
Wazhou Group Precision Transmission
Purchase of goods 500,314.63 210,946.05
Bearings Co.
Dalian Wazhou Fengyuan Machinery
Purchase of goods 18,731,852.51 5,575,226.43
Co.
Purchase of power,
Wafangdian Bearing Power Co. 55,333,523.93 50,025,218.68
acceptance of labor
Wafangdian Bearing Group National
Bearing Engineering Technology Acceptance of labor 19,186,671.38 19,005,108.68
Research Center Co.
Wafangdian Bearing Hospital Acceptance of labor 295,063.19
Wafangdian Bearing Education and
Acceptance of labor 5,000.00
Training Center
Dalian Wazhou Group Bearing
Acceptance of labor 7,082,869.93 5,952,915.64
Equipment Manufacturing Co.
Wafangdian Tongda Bearing
Acceptance of labor 3,494,085.67 4,477,173.00
Manufacturing Co.
Wafangdian Bearing Power Co. Acceptance of labor 14,222,406.31
Wafangdian Bearing Group Co. Accepting Labor 4,244,881.79 5,416,319.71
Wafangdian Bearing Group Equipment
Purchase of equipment 145,299.15
Technology Engineering Co.
Dalian Heavy Industry Crane Group Co. Accepting Labor 396,756.21
(2) Sales of goods/provide labour services
Related Party Contents of related current year prior year
transactions
Wafangdian Bearing Precision Forging Co. Sales of goods 291,292.20 101,061,836.66
Wazhou Group (USA) Bearing Co. Sales of goods 56,813,588.09
Wafangdian Bearing Group Precision Rolling
Sales of goods 79,095.60 81,168.58
Body Co.
Wafangdian Bearing Group Wind Power Bearing
Sales of goods 164,397,468.93 91,883,093.95
Co.
Wafangdian Bearing Group Co. Products for sale 116,104,897.25 143,574,285.73
Wafangdian Bearing Group High-end Automobile
Products for sale 3,836,824.53 8,980,219.56
Bearing Co.
Leipzig Roller Ball Bearing Co. Products for sale 13,762,885.32
Wafangdian Bearing Group Precision
Products for sale 1,631,936.17 2,288,278.55
Transmission Bearing Co.
167
Wafangdian Bearing Co., Ltd. 2023 annual report full text
ZWZBearingEuropeGmbH Products for sale
Wafangdian Bearing Group Special Precision
Products for sale 1,432,219.75 2,173,637.95
Bearing Co.
Wafangdian Tongda Bearing Manufacturing Co. Products for sale 52,686.32 160,129.79
Dalian Waxial Group Bearing Equipment
Products for sale 110,611.87 147,844.82
Manufacturing Co.
Wafangdian Bearing Group Precision Retainer Co. Products for sale 67,199.03 329,011.91
Wafangdian Bearing Group Dalian Wind Power
Products for sale 3,846,722.70
Spindle Bearing Co.
Wafangdian Bearing Group National Bearing
Products for sale 17,440.66
Engineering Technology Research Center Co.
Dalian Heavy Industry Crane Group Co. Sales of goods 63,824,668.96
Wafangdian Bearing Group Precision Rolling
Provision of labor 3,911,509.61 2,996,939.24
Bodies Co.
Wafangdian Bearing Group High-end Automobile
Provide labor 6,912,599.42 6,077,422.19
Bearing Co.
Wafangdian Bearing Group Precision
Provision of labor 50,689,051.70 42,787,233.68
Transmission Bearing Co.
Wafangdian Bearing Group Special Precision
Provision of labor 709,523.90 565,061.65
Bearing Co.
Dalian Wazhou Jinzhou Machinery Co.. Provision of labore 45,757.32
Wafangdian Bearing Precision Forging Co. Provision of labor 6,627,657.25 298,456.28
Dalian Waxial Group Bearing Equipment
Provide labor 576,038.71 471,453.81
Manufacturing Co.
Wafangdian Tongda Bearing Manufacturing Co. Provide labor 4,629,258.25 4,776,402.46
Wafangdian Bearing Group Precision Retainer Co. Provide labor 109,425.26
Wafangdian Bearing Group Co. Provide labor 32,238,366.30 23,569,290.84
Wafangdian Bearing Group Wind Power Bearing
Provide labor 3,968,017.62 2,686,114.36
Co.
Wafangdian Bearing Group National Bearing
Provide labor 169,018.87
Engineering Technology Research Center Co.
168
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wafangdian Bearing Group Dalian Wind Power
Provision of labor 847,320.36
Spindle Bearing Co.
Wafangdian Bearing Group Co. Sales of equipment 3,552.51
Wafangdian Bearing Group Precision Retainer Co. Selling equipment 132,000.00 2,609,505.52
Wafangdian Bearing Group High-end Automobile
Selling equipment 335,000.00 35,482.35
Bearing Co.
2. Related Leases
1) As a lessor
Contents of
Related Party related current year prior year
transactions
Wafangdian Bearing Precision Forging Co. Factory for rent 1,173,050.00 1,173,050.00
Waxaxial Group High-end Automobile Bearing Co. Rent factory 1,557,509.06 1,019,845.20
Wafangdian Bearing Group Precision Retainer Co. Rent factory 919,956.60 885,456.60
Dalian Wazhou Fengyuan Machinery Co. Plant for rent 313,573.20 128,520.00
Wafangdian Bearing Group Precision Transmission
Plant for rent 277,764.00
Bearings Co.
Wafangdian Bearing Group Co. Plant for rent 1,736,191.66 1,168,056.00
Wafangdian Bearing Group National Bearing
Plant for rent 18,000.00
Engineering Technology Research Center Co.
Waxaxial Group High-end Automobile Bearing Co. Rental equipment 2,688,319.27 9,374,624.30
Wafangdian Bearing Group Precision Retainer Co. Rental equipment 504,098.12 561,318.25
Wafangdian Bearing Precision Forging Limited
Rental equipment 852,805.09 1,111,341.52
Liability Company
Wafangdian Bearing Group Co. Rental equipment 7,661,238.12
Wafangdian Bearing Group Precision Rolling Body
Rental equipment 342,483.12 359,088.14
Co.
Wafangdian Bearing Group Co. Rental equipment 7,880,951.13
Wafangdian Bearing Precision Steel Ball
Land for rent 58,677.65
Manufacturing Co.
Wafangdian Bearing Group Limited Liability
Company Precision Roller Manufacturing Branch Land for rent 197,565.00
Company
Wafangdian Bearing Precision Forging Limited
Land for rent 1,328,730.00 1,328,730.00
Liability Company
Wafangdian Bearing Group Co. Land for rent 395,595.00 480,660.00
Wafangdian Bearing Group Precision Retainer Co. Land for rent 265,455.00 265,455.00
169
Wafangdian Bearing Co., Ltd. 2023 annual report full text
2) Assets under lease
current year prior year
Rental costs Variable Rental costs Variable
for short-term lease for short-term lease
Category Interest
leases and payments not leases and payments not Interest
Lessor of assets expense on
low-value included in Increased right- low-value included in expense on Increased right-
rent in Rent paid lease Rent paid
asset leases the to-use assets asset leases the lease liabilities to-use assets
liabilities
with measuremen with measuremen assumed
assumed
simplified t of lease simplified t of lease
processing liabilities processing liabilities
Wafangdian
Bearing Group Land 287,930.24 287,930.24
Co.,Ltd
Wafangdian
Bearing Group Houses 1,537,692.55 1,537,692.55 1,645,770.40 1,645,770.40
Co.,Ltd
Wafangdian
Bearing Group Land 261,199.78 261,199.78 159,618.06 159,618.06
Co.,Ltd
Wafangdian
Bearing Group House 913,426.07 913,426.07
Co.,Ltd
Wafangdian
Bearing Group Equipment 250,370.00 250,370.00
Co.,Ltd
Wafangdian
Bearing Group Land 574,350.00 574,350.00 169,350.00 169,350.00
Co.,Ltd
Wafangdian
Bearing Group House 2,111,133.60 2,111,133.60 783,720.00 783,720.00
Co.,Ltd
Wafangdian
Bearing Group Equipment 457,777.66 457,777.66 107,095.50 107,095.50
Co.,Ltd
170
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wafangdian
Bearing Group Land 31,305.95 31,305.95
Co.,Ltd
Wafangdian
Bearing Group Houses 181,081.60 181,081.60
Co.,Ltd
Wafangdian
Bearing Group Houses 543,360.00 543,360.00 475,860.00 475,860.00
Co.,Ltd
Wafangdian
Bearing Group Land 174,555.00 174,555.00 174,555.00 174,555.00
Co.,Ltd
Wafangdian
Bearing Group Houses 54,000.00 54,000.00
Co.,Ltd
Wafangdian
Bearing Group Land 13,500.00 13,500.00
Co.,Ltd
Wafangdian
Bearing Group Land 441,900.00 441,900.00 441,900.00 441,900.00
Co.,Ltd
Wafangdian
Bearing Group House 389,470.80 389,470.80 389,470.80 389,470.80
Co.,Ltd
Wafangdian
Bearing Group Land 84,150.00 84,150.00 84,150.00 84,150.00
Co.,Ltd
Wafangdian
Bearing Group House 2,346,098.40 2,346,098.40 2,346,098.40 2,346,098.40
Co.,Ltd
171
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wafangdian
Bearing Group Equipment 917,077.75 917,077.75 917,241.91 917,241.91
Co.,Ltd
Wafangdian
Bearing Group Houses 1,646,677.20 1,646,677.20 1,646,677.20 1,646,677.20
Co.,Ltd
Wafangdian
Bearing Group Land 311,646.43 311,646.43 311,646.43 311,646.43
Co.,Ltd
Wafangdian
Bearing Group Equipment 88,891.46 88,891.46 148,641.28 148,641.28
Co.,Ltd
Wafangdian
Bearing Group Land 455,700.00 455,700.00 455,700.00 455,700.00
Co.,Ltd
Wafangdian
Bearing Group Houses 2,426,992.80 2,426,992.80 2,426,992.80 2,426,992.80
Co.,Ltd
Wafangdian
Bearing Group Land 2,802,400.80 2,802,400.80 2,802,400.80 2,802,400.80
Co.,Ltd
Wafangdian
Bearing Group Land 380,835.00 380,835.00
Co.,Ltd
Wafangdian
Bearing Group Equipment 932,221.10 932,221.10 932,221.10 932,221.10
Co.,Ltd
Wafangdian
Bearing Group Houses 40,565.00 40,565.00
Co.,Ltd
Wafangdian
Bearing Group Land 1,592.89 1,592.89
Co.,Ltd
172
Wafangdian Bearing Co., Ltd. 2023 annual report full text
3. Related party assets transfer and debt structure reconstruction
Related party Type of transaction current year prior year
Dalian Wazhou Group Bearing
Gain on debt restructuring 68,850.00
Equipment Manufacturing Co.
Wafangdian Bearing Group High-end
Gain on debt restructuring 10,000.00
Automobile Bearing Co.
Wafangdian Bearing Group National
Bearing Engineering Technology Gain on debt restructuring 325,981.60
Research Center Co.
Wafangdian Bearing Group Precision
Gain on debt restructuring 179,764.26 58,202.03
Retainer Co.
Wafangdian Bearing Group Precision
Gain on debt restructuring 216,494.85
Transmission Bearings Co.
Wafangdian Bearing Group Precision
Gain on debt restructuring 40,204.08 80,808.08
Rolling Body Co.
Wafangdian Bearing Group Co. Gain on debt restructuring 41,619.58
Wafangdian Bearing Group Co. Gain on debt restructuring 28,840.00
Wafangdian Bearing Group Equipment
Gain on debt restructuring 13,517.58
Technology Engineering Co.
Wafangdian Bearing Precision Forging
Gain on debt restructuring 1,521,938.73 177,962.26
& Pressing Co.
4. Management remuneration
Item current year prior year
Management remuneration 3,049,300.64 2,116,355.84
v. Unsettled receivables and payables from related parties
1) Items receivable
Closing Balance Opening balance
Items Related party
Book Book
Provision Provision
balance balance
Receivable
Wafangdian Bearing Group
38,930,017.91 51,601,405.24
Wind Power Bearing Co.
Wafangdian Bearing Group
93,090,154.73 84,978,681.79
Precision Rolling Bodies Co.
Wazhou Group (USA) Bearing
17,975,305.27 16,834,162.48
Co.
Wafangdian Bearing Group Co. 418,776.87
173
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wafangdian Bearing Group
Precision Transmission Bearing 28,758,673.80 30,335,154.70
Co.
Wafangdian Bearing Group
Special Precision Bearing Co.
Leipzig Roller Ball Bearing
2,319,865.06 274,528.41
Manufacturing Co.
Wafangdian Bearing Group
Dalian Wind Power Spindle 4,221,822.96
Bearing Co.
Wafangdian Bearing Precision
70,082,119.05 38,999,730.40
Forging & Pressing Co.
Prepayments
Wafangdian Bearing Precision
Forging Limited Liability 702,000.00
Company
Wafangdian Bearing Power Co. 1,367,700.54 149,056.71
Dalian Waxial Group Bearing
223,806.65 99,477.71
Equipment Manufacturing Co.
Other
receivables
Wafangdian Bearing Group Co. 26,445.41 54,005.53
Wafangdian Bearing Precision
794,027.00
Forging & Pressing Co.
2) Items payable
Closing Opening
Item Related party
Balance balance
Accounts
payable
Wafangdian Bearing Group Co. 158,795,885.06 132,706,895.33
Dalian Wazhou Group Bearing Equipment
4,163,412.40 10,821,238.70
Manufacturing Co.
Wafangdian Tongda Bearing Manufacturing Co. 3,346,653.01 80,793.56
Dalian Wazhou Jinzhou Machinery Co., Ltd 8,868,481.13
Dalian Wazhou Fengyuan Machinery Co. 8,834,110.73
Wafangdian Bearing Group National Bearing
Engineering Technology Research Center 13,557,749.01 12,560,399.01
Wafangdian Bearing Group
Wafangdian Bearing Group Precision Retainer Co. 27,598,313.78 27,868,567.48
Wafangdian Bearing Power Co. 6,870,562.45 3,061,174.63
Wafangdian Bearing Group High-end Automobile
47,640,882.48 32,490,015.05
Bearing Co.
Wafangdian Bearing Group Special Precision Bearing
1,944,242.12 2,972,132.13
Co.
Contractual
liabilities
174
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Wazhou Bearing Group (USA) Bearing Co. 40,651.15
Leipzig Roller Ball Bearing Production Co. 946.44
Wafangdian Bearing Precision Forging Co. 323,075.21
Other
accounts
payable
Wafangdian Bearing Group Co. 33,381,575.49 29,201,965.04
Wafangdian Bearing Power Co. 1,542,455.15 1,027,263.84
XIV. Commitments and contingencies
As of December 31, 2023, the Group has significant commitments or material
contingencies that do not require disclosure.
XV. Events after the Balance Sheet Date
Until the financial report date, there is no significant post balance sheet event for
disclosure.
XVI.Other Significant Events
i. Major impact of the implementation of the "Rules Governing the Preparation
of Information Disclosure by Publicly Offered Securities Companies No. 15 - General
Provisions on Financial Reporting (Revised in 2023
In preparing these financial statements, the Company disclosed the relevant financial
information in accordance with the requirements of "No. 15 Rules for Information
Disclosure Preparation and Reporting of Companies with Publicly Issued Securities -
General Provisions on Financial Reporting (Revised in 2023)" issued by the China
Securities Regulatory Commission on December 22, 2023, except for financial instruments,
inventories, operating income, cash flow, research and development expenditure,
government grants and other items, the implementation of this provision did not have a
significant impact on the format of disclosure of key financial data for comparable
accounting periods for other items.
ii. Others
In addition to the above matters, as of December 31, 2023, there are other important
matters that the Group is not required to disclose.
XVII.Notes to the Main Items of the Financial Statements of Parent Company
175
Wafangdian Bearing Co., Ltd. 2023 annual report full text
i. Accounts receivable
(1). Accounts receivable with the bad debt provisions under accounting aging analysis
method
Aging Closing Balance Opening balance
Within1 year 951,468,006.08 976,123,178.58
1-2 years 89,650,544.04 155,623,006.95
2-3 years 94,460,492.42 36,568,253.07
3-4years 32,573,541.99 8,448,563.73
4-5years 6,535,792.15 14,050,235.17
Over 5 years 35,455,349.81 26,190,802.12
Total 1,210,143,726.49 1,217,004,039.62
Less: Provision for bad debt 126,916,163.65 125,212,282.16
Total 1,083,227,562.84 1,091,791,757.46
(1) .Category of accounts receivable
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Accounts receivable
with individual bad 68,299,555.07 5.64 68,299,555.07 100.00
debt provision
Accounts receivable
with bad debt
provision based on the 1,141,844,171.42 94.36 58,616,608.58 5.13 1,083,227,562.84
characters of credit
risk portfolio
-Aging portfolio
-Related party
888,360,748.35 73.41 58,616,608.58 6.60 829,744,139.77
portfolio
Total 253,483,423.07 20.95 253,483,423.07
(continued)
Opening Balance
Items Booking Provision
balance Booking
% value
Amount % Amount
Accounts receivable with individual bad
debt provision 68,147,261.25 5.60 68,147,261.25 100.00
176
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Accounts receivable with bad debt
provision based on the characters of
credit risk portfolio 1,148,856,778.37 94.40 57,065,020.91 4.97 1,091,791,757.46
-Aging portfolio
-Related party
935,284,105.16 76.85 57,065,020.91 6.10 878,219,084.25
portfolio
Total 213,572,673.21 17.55 213,572,673.21
177
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Bad debt provision for accounts receivable at the end of year based on individual
Closing Balance Opening Balance
Debtors name Provision Provision
Accounts Proportion Accounts
for bad Reasons for bad
receivable (%) receivable
debts debts
Heilongjiang Dragon Coal Logistics Co. 11,277,327.79 11,277,327.79 100 uncollectable 2,134,140.98 2,134,140.98
Liaoning Yinheng Galvanized Color Coated Steel Sheet Co. 3,213,308.67 3,213,308.67 100 uncollectable 3,213,308.67 3,213,308.67
Shenzhen Jiyang Intelligent Technology Co. 2,296,400.00 2,296,400.00 100 uncollectable 133,560.00 133,560.00
Shandong Yuanda Plate Technology Co. 1,804,722.77 1,804,722.77 100 uncollectable 1,804,722.77 1,804,722.77
Yingkou Steel Co. 1,696,318.44 1,696,318.44 100 uncollectable 1,696,318.44 1,696,318.44
Liaoning Waxaxial Bearing Sales Co. 1,611,795.99 1,611,795.99 100 uncollectable
Handan Branch of Hesteel Co. 1,608,611.42 1,608,611.42 100 uncollectable 1,608,611.42 1,608,611.42
Anshan Steel Co. 1,595,050.69 1,595,050.69 100 uncollectable 1,595,050.69 1,595,050.69
Bazhou Tianli Tube Manufacturing Co. 1,325,600.76 1,325,600.76 100 uncollectable 1,325,600.76 1,325,600.76
Zhejiang Yesheng New Material Co. 1,301,760.00 1,301,760.00 100 uncollectable 1,301,760.00 1,301,760.00
CITIC Heavy Industry Machinery Co. 1,126,828.28 1,126,828.28 100 uncollectable 1,128,791.54 1,128,791.54
Donghai New Material Co. 942,558.20 942,558.20 100 uncollectable 942,558.20 942,558.20
Shanghai Jieru Heavy Industry Mechanical & Electrical Equipment Co. 923,603.80 923,603.80 100 uncollectable 923,603.80 923,603.80
Tangshan Guofeng Iron & Steel Co. 883,297.41 883,297.41 100 uncollectable 883,297.41 883,297.41
Tongling Nonferrous Metals Group Co. 877,123.18 877,123.18 100 uncollectable 59,329.56 59,329.56
Jilin Chengzhong Auto Parts Co. 872,874.22 872,874.22 100 uncollectable 872,874.22 872,874.22
China Second Heavy Machinery Group (Deyang) Wanxin Engineering
795,887.92 795,887.92 100 uncollectable 795,887.92 795,887.92
Equipment
Benxi Beiyang Iron & Steel (Group) Co. 775,804.98 775,804.98 100 uncollectable 775,804.98 775,804.98
Fujian Zhongguang Environmental Protection Technology Co. 761,374.62 761,374.62 100 uncollectable 761,374.62 761,374.62
Shandong Yuntong New Material Technology Co. 711,438.94 711,438.94 100 uncollectable 711,438.94 711,438.94
Dongfeng Motor Gearbox Co. 704,098.23 704,098.23 100 uncollectable 704,098.23 704,098.23
Shanghai Weiqiang Heavy Industry Machinery Co. 673,595.42 673,595.42 100 uncollectable 673,595.42 673,595.42
178
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Dalian Tianyuan Electric Co. 666,383.31 666,383.31 100 uncollectable 666,383.31 666,383.31
Shanxi Hongda Steel Co. 657,373.00 657,373.00 100 uncollectable 657,373.00 657,373.00
Dandong Shuguang Heavy Duty Axle Co. 642,833.42 642,833.42 100 uncollectable 642,833.42 642,833.42
Hangzhou Qianjin Gearbox Group Co. 626,952.30 626,952.30 100 uncollectable 634,135.80 634,135.80
Wolong Electric Huaian Qingjiang Motor Co. 601,859.03 601,859.03 100 uncollectable 601,859.03 601,859.03
Xingtai Iron & Steel Co. 590,148.98 590,148.98 100 uncollectable 590,148.98 590,148.98
Qinghai Lufeng New Material Co. 525,743.44 525,743.44 100 uncollectable 525,743.44 525,743.44
Jiangsu Loesche Heavy Industry Machinery Co. 506,477.77 506,477.77 100 uncollectable 506,477.77 506,477.77
Bensteel Plate Co. 487,064.68 487,064.68 100 uncollectable 487,064.68 487,064.68
Dongfeng Commercial Vehicle Co. 486,019.87 486,019.87 100 uncollectable 486,019.87 486,019.87
Mudanjiang Reducer Factory 467,905.65 467,905.65 100 uncollectable 467,905.65 467,905.65
Shandong Province Zhangqiu Blower Co. 461,708.13 461,708.13 100 uncollectable 461,708.13 461,708.13
07-256 Factory 460,854.77 460,854.77 100 uncollectable 460,854.77 460,854.77
Hunan Chaoyang Electromechanical Co. 446,627.60 446,627.60 100 uncollectable 446,627.60 446,627.60
Xiangtan Electric Machinery Co. 416,549.65 416,549.65 100 uncollectable 416,549.65 416,549.65
Shanxi TISCO Stainless Steel Co. 402,332.21 402,332.21 100 uncollectable 402,332.21 402,332.21
Chengdu Gaoyuan Mechanical & Electrical Equipment Co. 383,615.52 383,615.52 100 uncollectable 383,615.52 383,615.52
Ningbo Naitjia Machinery Manufacturing Co. 383,370.79 383,370.79 100 uncollectable
Xuzhou Xugong Material Supply Co. 373,237.55 373,237.55 100 uncollectable 373,237.55 373,237.55
Taian Tianhua Economic and Trade Co. 364,189.79 364,189.79 100 uncollectable 346,554.01 346,554.01
Nippon Steel Yingkou Medium Plate Co. 351,890.29 351,890.29 100 uncollectable 351,890.29 351,890.29
Northeast Special Steel Group Beiman Special Steel Co. 315,004.72 315,004.72 100 uncollectable 315,004.72 315,004.72
Taicang Hutai Chang'e Paper Equipment Co. 310,361.32 310,361.32 100 uncollectable 310,361.32 310,361.32
Pangang Group Chengdu Iron & Steel Co. 303,305.45 303,305.45 100 uncollectable 303,305.45 303,305.45
Hebei Jinxi Iron and Steel Group Co. 301,978.67 301,978.67 100 uncollectable 301,978.67 301,978.67
Harbin Harbin Power Technology Co. 297,905.32 297,905.32 100 uncollectable 297,905.32 297,905.32
Sinoma Zibo Heavy Machinery Co. 293,817.58 293,817.58 100 uncollectable
179
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Zhuzhou Gear Co. 290,587.00 290,587.00 100 uncollectable 270,087.40 270,087.40
Ningbo Fan Co. 287,783.07 287,783.07 100 uncollectable
Jiangsu Xinrui Gear System Co. 286,949.88 286,949.88 100 uncollectable 286,949.88 286,949.88
Erzhong Group (Deyang) Jingheng Transmission Equipment Co. 286,935.03 286,935.03 100 uncollectable 286,935.03 286,935.03
Siemens Electric (China) Co. 284,110.82 284,110.82 100 uncollectable 284,110.82 284,110.82
Baofeng Xianglong Stainless Steel Co. 273,900.00 273,900.00 100 uncollectable
Baotou Tianli Huanfa Mechanical & Electrical Co. 273,597.27 273,597.27 100 uncollectable
Hengfengtai Precision Machinery Co. 270,886.98 270,886.98 100 uncollectable 318,948.38 318,948.38
Anhui Jianghuai Automobile Group Co. 264,521.67 264,521.67 100 uncollectable 264,521.67 264,521.67
Baoji Loyalty Industry & Trade Co. 256,372.12 256,372.12 100 uncollectable 256,372.12 256,372.12
Taiyuan Heavy Industry Co. 254,016.66 254,016.66 100 uncollectable 275,596.93 275,596.93
Baoji Huawei Mining Machinery Co. 248,758.75 248,758.75 100 uncollectable 200,000.00 200,000.00
Yanggu Danyu Sheet Co. 243,280.00 243,280.00 100 uncollectable 243,280.00 243,280.00
Tonghua Iron and Steel Co. 240,568.39 240,568.39 100 uncollectable 240,568.39 240,568.39
Shijiazhuang Mighty Slurry Pump Co. 238,749.98 238,749.98 100 uncollectable 238,749.98 238,749.98
Inner Mongolia Hongji Technology New Energy Co. 231,610.81 231,610.81 100 uncollectable 231,610.81 231,610.81
Tai Heavy Coal Machinery Co. 215,142.12 215,142.12 100 uncollectable 215,142.12 215,142.12
Qinhuangdao Shouqin Metal Materials Co. 213,911.48 213,911.48 100 uncollectable 213,911.48 213,911.48
Chongqing Tiema Industrial Group Co. 211,196.98 211,196.98 100 uncollectable 211,196.98 211,196.98
SAIC Iveco Hongyan Commercial Vehicle Co. 210,860.60 210,860.60 100 uncollectable 210,860.60 210,860.60
Hubei Tongfang Gaoke Pump Industry Co. 207,567.06 207,567.06 100 uncollectable 121,727.00 121,727.00
Chengdu Sales Center (Panzhihua Steel & Vanadium Co., Ltd., Pangangang
203,004.70 203,004.70 100 uncollectable
Group)
Tianjin Rongtai New Composite Material Co. 200,000.00 200,000.00 100 uncollectable 200,000.00 200,000.00
Hebei Wenfeng Steel Co. 197,979.65 197,979.65 100 uncollectable 197,979.65 197,979.65
Jiangsu Xuzhou Forging & Pressing Machine Tool Factory Group Co. 188,906.34 188,906.34 100 uncollectable 188,906.34 188,906.34
Hubei Waxaxial Xinsheng Technology Co. 188,136.00 188,136.00 100 uncollectable 188,136.00 188,136.00
Nanjing Light Industry Machinery Factory Co. 185,079.54 185,079.54 100 uncollectable 185,079.54 185,079.54
180
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Taiyuan Tongze Heavy Industry Co. 170,178.79 170,178.79 100 uncollectable 170,178.79 170,178.79
Beijing Jingcheng Star Technology Development Co. 170,010.00 170,010.00 100 uncollectable 450,000.00 450,000.00
Shandong Huali Motor Group Suzhou Manufacturing Co. 164,801.28 164,801.28 100 uncollectable 244,801.28 244,801.28
Xuzhou Meritor Axle Co. 163,037.45 163,037.45 100 uncollectable 163,037.45 163,037.45
Siping Blower Co. 160,053.21 160,053.21 100 uncollectable 160,053.21 160,053.21
Xiangdian Heavy Equipment Co. 158,854.17 158,854.17 100 uncollectable 158,854.17 158,854.17
Hubei Quanli Machinery Group Co. 152,489.82 152,489.82 100 uncollectable 152,489.82 152,489.82
Steel Butler (Shanghai) Technology Co. 151,927.34 151,927.34 100 uncollectable
Shandong Kerui Steel Plate Co. 151,411.57 151,411.57 100 uncollectable 156,702.16 156,702.16
Anshan Steel Machinery Development Metallurgical Electric Repair Factory 150,734.55 150,734.55 100 uncollectable 150,734.55 150,734.55
Wafangdian Hongda Constant Velocity Universal Joint Manufacturing Co. 148,466.32 148,466.32 100 uncollectable 148,466.32 148,466.32
Beishangguang (Guangzhou) Machinery Equipment Co. 135,345.75 135,345.75 100 uncollectable
Hubei Jingshan Light Industry Machinery Co. 132,087.65 132,087.65 100 uncollectable
Anhui Anfeng Fan Co. 131,355.36 131,355.36 100 uncollectable 131,355.36 131,355.36
Zhejiang Zhonghong Motor Co. 126,348.05 126,348.05 100 uncollectable 126,348.05 126,348.05
Shenyang Qunding Machinery Equipment Co. 126,286.35 126,286.35 100 uncollectable 126,286.35 126,286.35
Tangshan Dunshi Machinery Manufacturing Co. 124,474.60 124,474.60 100 uncollectable 124,474.60 124,474.60
Guangxi Tianyang Huamei Paper Co. 122,629.00 122,629.00 100 uncollectable 122,629.00 122,629.00
Shenye Heavy Equipment (Shenyang) Co. 121,909.54 121,909.54 100 uncollectable 121,909.54 121,909.54
Harbin First Machine Manufacturing Group Co. 121,033.33 121,033.33 100 uncollectable 121,033.33 121,033.33
Anhui Foma Auto Parts Group Co. 119,386.14 119,386.14 100 uncollectable
Anshan Anzhong Mining Machinery Co. 116,819.89 116,819.89 100 uncollectable 83,746.30 83,746.30
Shanghai Yaotai Engineering Technology Co. 113,054.61 113,054.61 100 uncollectable 113,054.61 113,054.61
Beijing Machinery Industry Automation Research Institute Co. 111,484.00 111,484.00 100 uncollectable
Shandong Baoding Coal Coking Co. 110,528.29 110,528.29 100 uncollectable 110,528.29 110,528.29
Wuhan Autopilot Motor Co. 109,112.60 109,112.60 100 uncollectable
TISCO Group Dongfang Iron & Steel Co. 108,997.44 108,997.44 100 uncollectable 108,997.44 108,997.44
181
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Yingkou Jiachen Fuel Chemical Co. 108,451.55 108,451.55 100 uncollectable 108,451.55 108,451.55
Lingyuan Iron and Steel Co. 108,446.16 108,446.16 100 uncollectable 110,000.00 110,000.00
Shougang Changzhi Iron & Steel Co. 107,819.72 107,819.72 100 uncollectable
Tianma Automobile Group Co. 107,121.10 107,121.10 100 uncollectable 107,121.10 107,121.10
Shenyang Sanming Heavy Industry Machinery Co. 105,807.39 105,807.39 100 uncollectable 105,807.39 105,807.39
Weichai (Weifang) Medium Diesel Engine Co. 104,548.21 104,548.21 100 uncollectable 104,548.21 104,548.21
Jiangsu Aerospace Power Electromechanical Co. 104,257.06 104,257.06 100 uncollectable 82,187.55 82,187.55
DBI Corporation 102,568.64 102,568.64 100 uncollectable 102,568.64 102,568.64
Yang Coal Xinzhou General Machinery Co. 100,447.88 100,447.88 100 uncollectable 100,447.88 100,447.88
Other individual accruals 7,317,964.82 7,317,964.82 100 uncollectable 23,266,178.46 23,266,178.46
Total 68,299,555.07 68,299,555.07 68,147,261.25 68,147,261.25
182
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Provision for bad debts by portfolio
Portfolio accruals items
Closing Balance
Name Provision for bad
Accounts Receivable Proportion (%)
debts
Within 1 year 783,068,065.44 39,187,753.50 5.00
1-2 years 69,540,783.04 6,954,078.30 10.00
2-3 years 23,076,562.45 4,615,312.49 20.00
3-4years 9,098,061.61 4,549,030.81 50.00
4-5years 1,334,211.66 1,067,369.33 80.00
Over 5 years 2,243,064.15 2,243,064.15 100.00
Related Party
253,483,423.07
Portfolio
Total 1,141,844,171.42 58,616,608.58
(2) Provision for bad debts charged off, reversed or recovered during the
period Related party portfolio
Opening Amount during the period Closing
Category
Balance Accrued Received Charge off balance
Provision for
125,212,282.16 7,777,293.68 1,257,209.05 4,816,203.14 126,916,163.65
bad debts
Total 125,212,282.16 7,777,293.68 1,257,209.05 4,816,203.14 126,916,163.65
(3) Accounts receivable written off in current period
Item Written-off Amount
Accounts receivable written off 4,816,203.14
183
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Significant amount written off
Whether arising from
Debtors name Nature Amounts Reasons Write-off procedures connected
transactions
Shandong Hengji New Material Co. payment for goods 2,284,666.96 uncollectable Internal approvals N
Henan Taihang Vibration Machinery Co. payment for goods 989,207.41 uncollectable Internal approvals N
Shaanxi Hande Axle Co. payment for goods 309,157.59 uncollectable Internal approvals N
Shandong Guanpeng Sheet Metal Co. payment for goods 273,748.84 uncollectable Internal approvals N
Shaanxi Hande Axle Co. payment for goods 261,036.63 uncollectable Internal approvals N
Zibo Boshan Advance Reducer Factory Co. payment for goods 244,579.32 uncollectable Internal approvals N
Total 4,362,396.75
184
Wafangdian Bearing Co., Ltd. 2023 annual report full text
(4) The top five significant accounts receivable categorized by debtors
Closing Balance Proportion Receivable
of total bad debts &
Debtors name Contractual closing contractual
Receivable Total balance assets
assets
(%) impairment
Wafangdian Bearing Group
253,088,686.58 253,088,686.58 20.91
Corporation and subsidiaries
China National Railway Group
65,328,867.27 65,328,867.27 5.40 3,315,586.02
Corporation and subsidiaries
China Railway Group
Corporation (CRGC)and 46,806,964.33 46,806,964.33 3.87 2,640,533.11
subsidiaries
Dalian Heavy Industry Crane
Group Corporation and 38,058,776.35 38,058,776.35 3.14 2,022,930.49
subsidiaries
China Shipbuilding Industry
23,949,683.21 23,949,683.21 1.98 1,276,968.12
Materials Southwest Co.,Ltd
Total 427,232,977.74 427,232,977.74 35.30 9,256,017.75
ii. Other receivables
Items Closing Balance Opening Balance
Interest receivable
Dividends receivable 11,843,105.36 11,843,105.36
Other receivables 290,208,402.21 314,644,304.84
Total 302,051,507.57 326,487,410.20
(1) Dividend receivable
Investee Closing Balance Opening Balance
Wazhou Precision of Spherical Roller Bearings
11,843,105.36 11,843,105.36
(Wafangdian) Co., Ltd
Subtotal 11,843,105.36 11,843,105.36
Less: provision for bad debts
Total 11,843,105.36 11,843,105.36
(2) Other receivable
1) Other receivable based on aging
Aging Closing Balance Opening Balance
Within 1 year 286,347,894.82 312,488,558.21
1-2 years 3,028,808.31 2,909,616.92
2-3 years 2,110,239.68 504,211.96
3-4years 287,195.88 254,121.72
4-5years 89,830.61 119,264.25
Over 5 years 4,914,986.54 4,363,179.66
Subtotal 296,778,955.84 320,638,952.72
Related Party Portfolio 6,570,553.63 5,994,647.88
Total 290,208,402.21 314,644,304.84
185
Wafangdian Bearing Co., Ltd. 2023 annual report full text
2) The categories of other receivable
Closing Balance
Items
Booking balance Provision
Booking balance
Amount % Amount %
Other receivables with
individual bad debt 4,605,722.33 1.55 4,605,722.33 100.00
provision
Other receivables identified
bad debt provision based 292,173,233.51 98.45 1,964,831.30 0.67 290,208,402.21
on the characters of credit
risk portfolio
-Aging combination 9,206,206.49 3.10 1,964,831.30 21.34 7,241,375.19
-Risk-free portfolio 505,121.61 0.17 505,121.61
-Related party portfolio 282,461,905.41 95.18 282,461,905.41
Total 296,778,955.84 100.00 6,570,553.63 290,208,402.21
(Continued)
Opening Balance
Items
Booking balance Provision
Booking balance
Amount % Amount %
Other receivables with
individual bad debt 4,047,178.65 1.26 4,047,178.65 100.00
provision
Other receivables identified
bad debt provision based 316,591,774.07 98.74 1,947,469.23 0.62 314,644,304.84
on the characters of credit
risk portfolio
-Aging combination 10,998,423.58 3.43 1,947,469.23 17.71 9,050,954.35
-Risk-free portfolio 1,160,078.82 0.36 1,160,078.82
-Related party portfolio 304,433,271.67 94.95 304,433,271.67
Total 320,638,952.72 100.00 5,994,647.88 314,644,304.84
Other receivables with individual bad debt provision
Closing Balance Opening Balance
Items Book Rate Book
bad debts Reasons bad debts
balance (%) balance
186
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Closing Balance Opening Balance
Items Book Rate Book
bad debts Reasons bad debts
balance (%) balance
Other
receivables
with
4,605,722.33 4,605,722.33 100.00 uncollectable 4,047,178.65 4,047,178.65
individual
bad debt
provision
Total 4,605,722.33 4,605,722.33 4,047,178.65 4,047,178.65
Provision for bad debts by portfolio
Closing Balance
Items
Other receivables bad debts Proportion (%)
Within 1 year 3,885,989.47 194,299.47 5.00
1-2 years 3,023,808.31 302,380.83 10.00
2-3 years 841,853.86 168,370.77 20.00
3-4years 281,014.09 140,507.05 50.00
4-5years 71,337.90 57,070.32 80.00
Over 5 years 1,102,202.86 1,102,202.86 100.00
-Risk-free portfolio 505,121.61
282,461,905.41
-Related partyportfolio
Total 292,173,233.51 1,964,831.30
3) Bad debt provision of other receivable
1 st stage 2 nd stage 3 rd stage
Expected
Provision for bad credit loss Expected credit Expected credit
Total
debt within loss within life loss within life
following 12 time(unimpaired) time(impaired)
months
Balance on January 1st,
2023 5,994,647.88 5,994,647.88
On January 1, 2023 Other
receivable carrying - - - -
amount on the book
--get into 2nd stage - - - -
--get into 3rd stage - - - -
nd
--reverse into 2 stage
- - - -
-reverse into 1st stage - - - -
Accrual for the period 575,905.75 575,905.75
Reversal
Write-offs during the
period
Write-offs during the
period
187
Wafangdian Bearing Co., Ltd. 2023 annual report full text
Other changes
Closing balance 6,570,553.63 6,570,553.63
4) Provision for bad debts charged off, reversed or recovered during the period
Opening Amount during the period Closing
Category
Balance Accrued Received Charge off Balance
bad debt 5,994,647.88 575,905.75 6,570,553.63
Total 5,994,647.88 575,905.75 6,570,553.63
5) No other receivables were actually written off during the period
6) The categories of other receivable by nature
Nature Closing Balance Opening Balance
Loans from related parties 281,651,433.00 304,433,271.67
Secured fund & Deposit 7,005,101.19 7,260,746.37
Petty cash 1,279,521.48 1,464,007.16
Electricity bill 495,121.67 1,155,078.82
Others 6,347,778.50 6,325,848.70
Total 296,778,955.84 320,638,952.72
7) The top significant other receivable categorized by debtors
Rate of
closing
Company name Category Againg other Bad debts
balance
receivables
Dalian Waxial Precision Motor Related Within 4
133,593,120.52 45.01
Automobile Bearing Co. Party Loans years
Waxaxial Liaoyang Bearing Related Within 4
102,381,156.58 34.50
Manufacturing Co. Party Loans years
Waxaxial Precision Spherical
Related Within 4
Roller Bearing (Wafangdian) 45,677,155.90 15.39
Party Loans years
Co.
Within 2
Anhui Conch Cement Co. Margin 1,300,000.00 0.44 130,000.00
years
Within 2
Daqin Railway Co. Margin 1,118,900.00 0.38 63,395.00
years
Total 284,070,333.00 95.72 193,395.00
iii. Long-term equity investments
Closing Balance Opening Balance
Item
Book Provision Book Value Book Provision Book Value
balance balance
Investment in
226,488,897.67 226,488,897.67 225,693,897.67 225,693,897.67
subsidiaries
Investment in JV,
associates
226,488,897.67 226,488,897.67 225,693,897.67 225,693,897.67
Total
188
Wafangdian Bearing Co., Ltd. 2023 annual report full text
1) Investment in subsidiaries
Changes during the period
Provision for Closing
Investee Opening Balance Provision Provision
Additional Reduced impairment for Others Balance
the period
Wazhou Liaoyang Bearing
31,447,259.95 795,000.00 32,242,259.95
Manufacturing Co.
Dalian Wazhou Precision Motorized
45,478,956.37 45,478,956.37
Automotive Bearing Co.
Wazhou Precision Spherical Roller
148,767,681.35 148,767,681.35
Bearing (Wafangdian) Co.
Total 225,693,897.67 795,000.00 226,488,897.67
189
Wafangdian Bearing Co., Ltd. 2023 annual report full text ( The currency is in RMB Yuan except otherwise indicated)
iv. Operating revenue and cost
1. Situation of operating revenue and cost
current year prior year
Item
Revenue Cost Revenue Cost
Revenue from main operation 2,078,051,298.96 1,788,578,899.29 2,103,804,100.56 1,759,630,657.07
Revenue from other operation 142,408,231.96 50,429,309.71 287,385,110.16 178,728,084.25
Total 2,220,459,530.92 1,839,008,209.00 2,391,189,210.72 1,938,358,741.32
Principle operation - classified according to Industries
current year prior year
Industries
Sales revenue Cost of sales Sales revenue Cost of sales
Export 180,093,365.40 168,510,025.21 216,679,504.65 204,095,685.61
Domestic 1,806,168,825.45 1,558,520,183.89 1,809,614,890.05 1,478,420,717.56
Including:
Transportation 357,711,301.33 340,912,594.57 389,506,553.45 336,763,134.41
vehicle bearings
Special use
797,640,051.38 612,926,045.89 766,000,221.77 587,952,935.71
bearings
General use
650,817,472.74 604,681,543.43 654,108,114.83 553,704,647.44
bearings
Industrial
91,789,108.11 61,548,690.19 77,509,705.86 77,114,253.90
Operations
142,408,231.96 50,429,309.71 287,385,110.16 178,728,084.25
Other operating income
Total 2,220,459,530.92 1,839,008,209.00 2,391,189,210.72 1,938,358,741.32
2. Breakdown information of operating revenues and operating costs
Revenues generated from customer contracts during the period were as follows:
Current year
Items
Sales revenue Cost of sales
Export 180,093,365.40 168,510,025.21
Domestic 1,806,168,825.45 1,558,520,183.89
Including:
357,711,301.33 340,912,594.57
Transportation vehicle bearings
190
Wafangdian Bearing Co., Ltd. 2023 annual report full text ( The currency is in RMB Yuan except otherwise indicated)
Special use bearings 797,640,051.38 612,926,045.89
General use bearings 650,817,472.74 604,681,543.43
Industrial Operations 91,789,108.11 61,548,690.19
Total 2,078,051,298.96 1,788,578,899.29
v. Investment income
Items Current year Prior year
Dividend income earned during the holding period of investments in other
2,000,000.00
equity instruments
Investment income from debt restructuring 8,260,371.82 4,115,928.61
Total 10,260,371.82 4,115,928.61
XVIII. Supplementary Information
i. Non-operating profit or loss in current year
Items Amounts Instruction
Gains and losses on disposal of non-current assets, including the offsetting portion of
1,406,119.64
the provision for asset impairment already made
Government grants recognized in profit or loss for the current period, except for
government grants that are closely related to the Company's normal business
10,623,570.13
operations, in compliance with national policies and in accordance with defined
criteria, and that have a sustainable impact on the Company's profit or loss
Gains and losses arising from changes in fair value of financial assets and financial
liabilities held by non-financial enterprises and gains and losses arising from the
-29,276.17
disposal of financial assets and financial liabilities, except for effective hedging
business related to the Company's normal business operations
Reversal of provision for impairment of receivables individually tested for
10,243,668.21
impairment
Gains and losses on debt restructuring 10,935,641.78
Non-operating income and expenses other than those listed above 158,222.87
Other equity
Others 2,000,000.00 instruments
investment dividends
Subtotal 35,337,946.46
Income tax effect 5,500,426.31
Minority interests impact amount (after tax)
Total 29,837,520.15
ii. Return on equity and earnings per share
191
Wafangdian Bearing Co., Ltd. 2023 annual report full text ( The currency is in RMB Yuan except otherwise indicated)
Weighted average Earnings per share (EPS)
Profit of report period return on net
assets (%) Basic EPS Diluted EPS
Net profit attributable to shareholders of parent company -23.65 -0.2471 -0.2471
Net profit after deducting non-recurring gains and losses -30.70 -0.2471 -0.2471
attributable to shareholders of parent company
iii. Differences in accounting data under domestic and foreign accounting standards
(1) The difference between net profit and net assets in financial reports disclosed under both international
accounting standards and Chinese accounting standards
□ Applicable Not applicable
(2) The difference between net profit and net assets in financial reports disclosed under both foreign accounting
standards and Chinese accounting standards
Applicable Not applicable
(3) Explanation of the reasons for the difference of accounting data under domestic and foreign accounting
standards, the name of the overseas audit institution should be indicated if the difference adjustment is made to
the data audited by the overseas audit institution
4. Others
192
