Shandong Zhonglu Oceanic Fisheries Co., Ltd.
Financial Report for half year 2022
1
Financial Report
I. Audit report
Whether the semi annual report is audited
□ Yes √ No
The company's semi annual financial report has not been audited
II. Financial Statement
Statement in Financial Notes are carried Unit: RMB/CNY
1. Consolidated Balance Sheet
Prepared by: Shandong Zhonglu Oceanic Fisheries Co., Ltd.
June 30, 2022
Unit: RMB/CNY
Item June 30, 2022 January 1, 2022
Current assets:
Monetary funds 212,936,131.11 210,573,782.49
Settlement provisions
Capital lent
Trading financial assets
Derivative financial assets
Note receivable
Account receivable 40,281,396.90 37,806,586.91
Receivable financing
Accounts paid in advance 41,563,462.07 18,683,750.61
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance
receivable
Other account receivable 1,749,343.28 3,596,759.88
Including: Interest receivable
Dividend receivable
Buying back the sale of financial
assets
Inventories 308,254,758.90 277,095,357.75
Contractual assets
Assets held for sale
Non-current asset due within one
year
Other current assets 4,272,136.20 20,633,592.23
Total current assets 609,057,228.46 568,389,829.87
Non-current assets:
Loans and payments on behalf
Debt investment
Other debt investment
Long-term account receivable
2
Long-term equity investment 2,382,345.00
Investment in other equity
instrument
Other non-current financial assets
Investment real estate 29,445,894.41 30,108,932.75
Fixed assets 527,708,946.38 476,894,877.56
Construction in progress 166,987,910.20 165,273,027.75
Productive biological asset
Oil and gas asset
Right-of-use assets 1,081,222.79 2,354,943.86
Intangible assets 63,469,063.71 12,110,397.72
Expense on Research and
Development
Goodwill
Long-term expenses to be
173,351.68 220,738.00
apportioned
Deferred income tax asset 1,601,290.53 1,644,945.96
Other non-current asset 52,180,917.76 143,137,267.24
Total non-current asset 845,030,942.46 831,745,130.84
Total assets 1,454,088,170.92 1,400,134,960.71
Current liabilities:
Short-term loans 4,006,041.65 10,013,291.67
Loan from central bank
Capital borrowed
Trading financial liability 96,000.00
Derivative financial liability
Note payable
Account payable 43,389,594.61 50,121,395.04
Accounts received in advance
Contractual liability 8,623,486.26 13,220,675.60
Selling financial asset of
repurchase
Absorbing deposit and interbank
deposit
Security trading of agency
Security sales of agency
Wage payable 25,576,335.27 45,410,711.06
Taxes payable 2,380,258.52 4,258,871.51
Other account payable 13,471,312.56 9,774,065.87
Including: Interest payable
Dividend payable
Commission charge and
commission payable
Reinsurance payable
Liability held for sale
Non-current liabilities due within
1,797,180.34 4,909,314.65
one year
Other current liabilities 61,937.73 14,100.55
Total current liabilities 99,402,146.94 137,722,425.95
Non-current liabilities:
Insurance contract reserve
Long-term loans 146,033,600.00 149,393,532.37
Bonds payable
Including: Preferred stock
Perpetual capital
securities
Lease liability
Long-term account payable
3
Long-term wages payable 1,018,222.58 1,026,222.58
Accrual liability
Deferred income 14,126,983.85 13,691,209.07
Deferred income tax liabilities 2,702,398.91 2,777,589.45
Other non-current liabilities
Total non-current liabilities 163,881,205.34 166,888,553.47
Total liabilities 263,283,352.28 304,610,979.42
Owner’s equity:
Share capital 266,071,320.00 266,071,320.00
Other equity instrument
Including: Preferred stock
Perpetual capital
securities
Capital public reserve 295,620,272.02 284,054,997.75
Less: Inventory shares
Other comprehensive income -10,621,931.27 -18,256,201.98
Reasonable reserve 416,108.75 232,783.00
Surplus public reserve 21,908,064.19 21,908,064.19
Provision of general risk
Retained profit 370,505,786.16 379,524,911.94
Total owner’ s equity attributable to
943,899,619.85 933,535,874.90
parent company
Minority interests 246,905,198.79 161,988,106.39
Total owner’ s equity 1,190,804,818.64 1,095,523,981.29
Total liabilities and owner’ s equity 1,454,088,170.92 1,400,134,960.71
Legal Representative: Lu Lianxing
Person in Charge of Accounting: Fu Chuanhai
Person in Charge of Accounting Department: Lei Lixin
2. Balance Sheet of Parent Company
Unit: RMB/CNY
Item June 30, 2022 January 1, 2022
Current assets:
Monetary funds 71,082,770.63 49,943,353.89
Trading financial assets
Derivative financial assets
Note receivable
Account receivable 3,832,118.66 8,731,060.84
Receivable financing
Accounts paid in advance 9,138,261.53 3,565,433.92
Other account receivable 120,001,584.85 119,015,186.36
Including: Interest receivable
Dividend receivable 70,637,061.83 85,085,303.70
Inventories 64,587,834.92 47,379,848.34
Contractual assets
Assets held for sale
Non-current assets maturing within
one year
Other current assets 641,736.63 8,240,901.15
Total current assets 269,284,307.22 236,875,784.50
4
Non-current assets:
Debt investment
Other debt investment
Long-term receivables 4,395,477.99 3,858,748.19
Long-term equity investments 232,189,455.23 232,189,455.23
Investment in other equity
instrument
Other non-current financial assets
Investment real estate 29,445,894.41 30,108,932.75
Fixed assets 44,788,382.97 47,561,985.28
Construction in progress 165,772,605.94 118,472,605.94
Productive biological assets
Oil and natural gas assets
Right-of-use assets 316,967.02 1,003,689.06
Intangible assets 338,250.19 488,798.76
Research and development costs
Goodwill
Long-term deferred expenses
Deferred income tax assets
Other non-current assets 49,563,019.59 89,675,267.24
Total non-current assets 526,810,053.34 523,359,482.45
Total assets 796,094,360.56 760,235,266.95
Current liabilities:
Short-term borrowings
Trading financial liability
Derivative financial liability
Notes payable
Account payable 12,463,177.76 12,713,180.90
Accounts received in advance
Contractual liability 2,789,110.92 1,930,695.41
Wage payable 9,365,057.96 13,477,985.59
Taxes payable 163,333.88 426,832.47
Other accounts payable 99,524,148.83 43,495,400.72
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within
1,023,695.92 3,840,573.17
one year
Other current liabilities
Total current liabilities 125,328,525.27 75,884,668.26
Non-current liabilities:
Long-term loans 146,033,600.00 149,393,532.37
Bonds payable
Including: Preferred stock
Perpetual capital
securities
Lease liability
Long-term account payable
Long term employee compensation
674,730.26 682,730.26
payable
Accrued liabilities
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 146,708,330.26 150,076,262.63
Total liabilities 272,036,855.53 225,960,930.89
Owners’ equity:
5
Share capital 266,071,320.00 266,071,320.00
Other equity instrument
Including: Preferred stock
Perpetual capital
securities
Capital public reserve 279,115,900.17 279,115,900.17
Less: Inventory shares
Other comprehensive income
Special reserve
Surplus reserve 19,184,672.34 19,184,672.34
Retained profit -40,314,387.48 -30,097,556.45
Total owner’s equity 524,057,505.03 534,274,336.06
Total liabilities and owner’s equity 796,094,360.56 760,235,266.95
3. Consolidated Profit Statement
Unit: RMB/CNY
Item Semi-annual of 2022 Semi-annual of 2021
I. Total operating income 370,548,994.76 356,353,923.85
Including: Operating income 370,548,994.76 356,353,923.85
Interest income
Insurance gained
Commission charge and
commission income
II. Total operating cost 392,178,058.04 372,043,521.19
Including: Operating cost 365,817,738.76 338,791,986.63
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of
compensation
Net amount of withdrawal of
insurance contract reserve
Bonus expense of guarantee
slip
Reinsurance expense
Tax and extras 1,574,981.39 1,108,386.08
Sales expense 1,445,349.37 1,469,652.94
Administrative expense 25,639,725.37 26,604,847.70
R&D expense 332,543.96
Financial expense -2,632,280.81 4,068,647.84
Including: Interest
1,350,577.27 908,617.14
expenses
Interest income 202,305.23 358,030.77
Add: Other income 688,100.25 835,918.84
Investment income (Loss is
1,076,034.24 49,972.60
listed with “-”)
Including: Investment income
on affiliated company and joint venture
The termination of income
recognition for financial assets measured
by amortized cost
Exchange income (Loss is
listed with “-”)
Net exposure hedging income
(Loss is listed with “-”)
Income from change of fair
-96,000.00
value (Loss is listed with “-”)
6
Loss of credit impairment
360,747.35 -188,375.87
(Loss is listed with “-”)
Losses of devaluation of asset
-241,910.58
(Loss is listed with “-”)
Income from assets disposal
5,105,581.41 -41,980.15
(Loss is listed with “-”)
III. Operating profit (Loss is listed with
-14,494,600.03 -15,275,972.50
“-”)
Add: Non-operating income 37,000.10 34,284.70
Less: Non-operating expense 1,337.00 7,221.58
IV. Total profit (Loss is listed with “-”) -14,458,936.93 -15,248,909.38
Less: Income tax expense 358,112.38 399,605.91
V. Net profit (Net loss is listed with “-”) -14,817,049.31 -15,648,515.29
(i) Classify by business continuity
1.continuous operating net profit
-14,817,049.31 -15,648,515.29
(net loss listed with ‘-”)
2.termination of net profit (net loss
listed with ‘-”)
(ii) Classify by ownership
1.Net profit attributable to owner’s
-9,019,125.78 -8,959,371.06
of parent company
2.Minority shareholders’ gains and
-5,797,923.53 -6,689,144.23
losses
VI. Net after-tax of other comprehensive
9,914,560.92 -3,120,290.45
income
Net after-tax of other comprehensive
income attributable to owners of parent 7,634,270.71 -2,466,775.62
company
(I) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined
benefit plans that re-measured
2.Other comprehensive
income under equity method that cannot
be transfer to gain/loss
3.Change of fair value of
investment in other equity instrument
4.Fair value change of
enterprise's credit risk
5. Other
(ii) Other comprehensive income
items which will be reclassified 7,634,270.71 -2,466,775.62
subsequently to profit or loss
1.Other comprehensive
income under equity method that can
transfer to gain/loss
2.Change of fair value of
other debt investment
3.Amount of financial assets
re-classify to other comprehensive
income
4.Credit impairment
provision for other debt investment
5.Cash flow hedging reserve
6.Translation differences
arising on translation of foreign currency 7,634,270.71 -2,466,775.62
financial statements
7.Other
Net after-tax of other comprehensive
income attributable to minority 2,280,290.21 -653,514.83
shareholders
VII. Total comprehensive income -4,902,488.39 -18,768,805.74
Total comprehensive income -1,384,855.07 -11,426,146.68
7
attributable to owners of parent Company
Total comprehensive income
-3,517,633.32 -7,342,659.06
attributable to minority shareholders
VIII. Earnings per share:
(i) Basic earnings per share -0.03 -0.03
(ii) Diluted earnings per share -0.03 -0.03
Enterprise combine under the same control in the Period, the combined party realized net profit of 0 Yuan
before combination, and realized 0 Yuan at last period for combined party
Legal Representative: Lu Lianxing
Person in Charge of Accounting: Fu Chuanhai
Person in Charge of Accounting Department: Lei Lixin
4. Profit Statement of Parent Company
Unit: RMB/CNY
Item Semi-annual of 2022 Semi-annual of 2021
I. Operating income 43,901,252.32 35,533,846.86
Less: Operating cost 43,006,535.77 31,789,528.69
Taxes and surcharge 630,255.58 305,349.92
Sales expenses 89,075.70 133,261.11
Administration expenses 14,332,990.11 13,922,396.19
R&D expenses 26,409.47
Financial expenses -2,310,031.96 293,432.07
Including: Interest
1,182,579.77 9,200.53
expenses
Interest income 104,634.80 59,885.45
Add: Other income 17,154.36 36,064.46
Investment income (Loss is
1,076,034.24 49,972.60
listed with “-”)
Including: Investment income
on affiliated Company and joint venture
The termination of
income recognition for financial assets
measured by amortized cost (Loss is
listed with “-”)
Net exposure hedging income
(Loss is listed with “-”)
Changing income of fair
value (Loss is listed with “-”)
Loss of credit impairment
542,539.78 -108,023.83
(Loss is listed with “-”)
Losses of devaluation of asset
(Loss is listed with “-”)
Income on disposal of assets
(Loss is listed with “-”)
II. Operating profit (Loss is listed with
-10,238,253.97 -10,932,107.89
“-”)
Add: Non-operating income 22,759.94 13,479.82
Less: Non-operating expense 1,337.00
III. Total Profit (Loss is listed with “-”) -10,216,831.03 -10,918,628.07
Less: Income tax
IV. Net profit (Net loss is listed with “-
-10,216,831.03 -10,918,628.07
”)
(i) continuous operating net profit -10,216,831.03 -10,918,628.07
8
(net loss listed with ‘-”)
(ii) termination of net profit (net
loss listed with ‘-”)
V. Net after-tax of other comprehensive
income
(i) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined
benefit plans that re-measured
2.Other comprehensive
income under equity method that cannot
be transfer to gain/loss
3.Change of fair value of
investment in other equity instrument
4.Fair value change of
enterprise's credit risk
5. Other
(ii) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1.Other comprehensive
income under equity method that can
transfer to gain/loss
2.Change of fair value of
other debt investment
3.Amount of financial
assets re-classify to other
comprehensive income
4.Credit impairment
provision for other debt investment
5.Cash flow hedging
reserve
6.Translation differences
arising on translation of foreign
currency financial statements
7.Other
VI. Total comprehensive income -10,216,831.03 -10,918,628.07
VII. Earnings per share:
(i) Basic earnings per share
(ii) Diluted earnings per share
5. Consolidated Cash Flow Statement
Unit: RMB/CNY
Item Semi-annual of 2022 Semi-annual of 2021
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 359,507,267.53 338,552,894.58
services
Net increase of customer deposit
and interbank deposit
Net increase of loan from central
bank
Net increase of capital borrowed
from other financial institution
Cash received from original
insurance contract fee
Net cash received from reinsurance
business
Net increase of insured savings
and investment
9
Cash received from interest,
commission charge and commission
Net increase of capital borrowed
Net increase of returned business
capital
Net cash received by agents in sale
and purchase of securities
Write-back of tax received 18,349,028.22 15,024,792.81
Other cash received concerning
11,729,762.30 5,331,315.56
operating activities
Subtotal of cash inflow arising from
389,586,058.05 358,909,002.95
operating activities
Cash paid for purchasing
commodities and receiving labor 352,360,139.26 310,180,699.31
service
Net increase of customer loans and
advances
Net increase of deposits in central
bank and interbank
Cash paid for original insurance
contract compensation
Net increase of capital lent
Cash paid for interest, commission
charge and commission
Cash paid for bonus of guarantee
slip
Cash paid to/for staff and workers 79,035,276.88 68,101,993.18
Taxes paid 8,668,847.08 6,066,756.95
Other cash paid concerning
18,239,881.04 25,470,154.01
operating activities
Subtotal of cash outflow arising from
458,304,144.26 409,819,603.45
operating activities
Net cash flows arising from operating
-68,718,086.21 -50,910,600.50
activities
II. Cash flows arising from investing
activities:
Cash received from recovering
260,000,000.00 5,000,000.00
investment
Cash received from investment
1,076,034.24 49,972.60
income
Net cash received from disposal of
fixed, intangible and other long-term 7,554,887.43 13,240.00
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investing activities
Subtotal of cash inflow from investing
268,630,921.67 5,063,212.60
activities
Cash paid for purchasing fixed,
15,815,569.94 10,253,125.39
intangible and other long-term assets
Cash paid for investment 262,382,345.00
Net increase of mortgaged loans
Net cash received from
subsidiaries and other units obtained
Other cash paid concerning
investing activities
Subtotal of cash outflow from investing
278,197,914.94 10,253,125.39
activities
Net cash flows arising from investing
-9,566,993.27 -5,189,912.79
activities
III. Cash flows arising from financing
activities:
Cash received from absorbing 100,000,000.00
10
investment
Including: Cash received from
absorbing minority shareholders’ 100,000,000.00
investment by subsidiaries
Cash received from loans 24,834,164.92
Other cash received concerning
financing activities
Subtotal of cash inflow from financing
100,000,000.00 24,834,164.92
activities
Cash paid for settling debts 16,100,000.00 33,670,136.15
Cash paid for dividend and profit
3,490,984.61 1,004,775.53
distributing or interest paying
Including: Dividend and profit of
minority shareholder paid by
subsidiaries
Other cash paid concerning
652,967.28
financing activities
Subtotal of cash outflow from financing
20,243,951.89 34,674,911.68
activities
Net cash flows arising from financing
79,756,048.11 -9,840,746.76
activities
IV. Influence on cash and cash
equivalents due to fluctuation in 1,815,856.49 -2,938,712.59
exchange rate
V. Net increase of cash and cash
3,286,825.12 -68,879,972.64
equivalents
Add: Balance of cash and cash
209,649,305.99 255,735,611.93
equivalents at the period -begin
VI. Balance of cash and cash
212,936,131.11 186,855,639.29
equivalents at the period -end
6. Cash Flow Statement of Parent Company
Unit: RMB/CNY
Item Semi-annual of 2022 Semi-annual of 2021
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 20,028,339.91 17,698,634.68
services
Write-back of tax received 31,858.29 1,073.19
Other cash received concerning
8,001,569.03 12,443,413.94
operating activities
Subtotal of cash inflow arising from
28,061,767.23 30,143,121.81
operating activities
Cash paid for purchasing
commodities and receiving labor 29,919,326.23 16,826,989.61
service
Cash paid to/for staff and workers 19,240,930.75 19,957,927.95
Taxes paid 722,945.09 519,464.48
Other cash paid concerning
4,432,049.90 15,275,625.75
operating activities
Subtotal of cash outflow arising from
54,315,251.97 52,580,007.79
operating activities
Net cash flows arising from operating
-26,253,484.74 -22,436,885.98
activities
II. Cash flows arising from investing
activities:
Cash received from recovering
260,000,000.00 5,000,000.00
investment
Cash received from investment
15,524,276.11 25,559,172.60
income
11
Net cash received from disposal of
fixed, intangible and other long-term
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
2,051,160.00
investing activities
Subtotal of cash inflow from investing
277,575,436.11 30,559,172.60
activities
Cash paid for purchasing fixed,
3,838,108.94 175,032.86
intangible and other long-term assets
Cash paid for investment 260,000,000.00
Net cash received from
subsidiaries and other units obtained
Other cash paid concerning
3,168,000.00
investing activities
Subtotal of cash outflow from investing
263,838,108.94 3,343,032.86
activities
Net cash flows arising from investing
13,737,327.17 27,216,139.74
activities
III. Cash flows arising from financing
activities:
Cash received from absorbing
investment
Cash received from loans 24,834,164.92
Other cash received concerning
47,002,998.02
financing activities
Subtotal of cash inflow from financing
47,002,998.02 24,834,164.92
activities
Cash paid for settling debts 10,100,000.00 24,834,164.92
Cash paid for dividend and profit
3,321,092.94
distributing or interest paying
Other cash paid concerning
14,575,643.25
financing activities
Subtotal of cash outflow from financing
13,421,092.94 39,409,808.17
activities
Net cash flows arising from financing
33,581,905.08 -14,575,643.25
activities
IV. Influence on cash and cash
equivalents due to fluctuation in 73,669.23 160,196.16
exchange rate
V. Net increase of cash and cash
21,139,416.74 -9,636,193.33
equivalents
Add: Balance of cash and cash
49,943,353.89 32,186,883.39
equivalents at the period -begin
VI. Balance of cash and cash
71,082,770.63 22,550,690.06
equivalents at the period -end
7. Statement of Changes in Owners’ Equity (Consolidated)
Current Amount
Unit: RMB/CNY
Semi-annual of 2022
Owners’ equity attributable to the parent Company
Other
equity instrument Other
Minori Total
Perpe Less: compr Provisi
Item Share Reaso Surplu Retain ty owners
tual Capital Invent ehensi on of Subtot
capita Prefe nable s ed Other interes ’
capit reserve ory ve genera al
l rred Other reserve reserve profit ts equity
al shares incom l risk
stock e
secur
ities
12
-
I. The ending 266,0 284,05 21,908 379,52 933,53 161,98 1,095,
18,256 232,78
balance of the 71,32 4,997. ,064.1 4,911. 5,874. 8,106. 523,98
previous year ,201.9 3.00
0.00 75 9 94 90 39 1.29
8
Add: Changes
of accounting
policy
Error correction
of the last
period
Enterprise
combine under
the same control
Other
II. The -
266,0 284,05 21,908 379,52 933,53 161,98 1,095,
beginning 18,256 232,78
71,32 4,997. ,064.1 4,911. 5,874. 8,106. 523,98
balance of the ,201.9 3.00
current year 0.00 75 9 94 90 39 1.29
8
III. Increase/
Decrease in the 11,565 - 10,363 84,917 95,280
7,634, 183,32
period ,274.2 9,019, ,744.9 ,092.4 ,837.3
(Decrease is 270.71 5.75
7 125.78 5 0 5
listed with “-”)
(i) Total - - 84,917 83,532
7,634,
comprehensive 9,019, 1,384, ,092.4 ,237.3
income 270.71
125.78 855.07 0 3
(ii) Owners’ 11,565 11,565 11,565
devoted and
,274.2 ,274.2 ,274.2
decreased
capital 7 7 7
1.Common
shares invested
by shareholders
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity
with share-
based payment
11,565 11,565 11,565
4. Other ,274.2 ,274.2 ,274.2
7 7 7
(iii) Profit
distribution
1. Withdrawal
of surplus
reserves
2. Withdrawal
of general risk
provisions
3. Distribution
for owners (or
shareholders)
4. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital
reserves
13
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
capital)
3. Remedying
loss with
surplus reserve
4. Carry-over
retained
earnings from
the defined
benefit plans
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(v) Reasonable 183,32 183,32 183,32
reserve 5.75 5.75 5.75
1. Withdrawal
494,30 494,30 494,30
in the report
period 2.97 2.97 2.97
2. Usage in the 310,97 310,97 310,97
report period 7.22 7.22 7.22
(vi) Others
-
VI. Balance at 266,0 295,62 21,908 370,50 943,89 246,90 1,190,
10,621 416,10
the end of the 71,32 0,272. ,064.1 5,786. 9,619. 5,198. 804,81
period ,931.2 8.75
0.00 02 9 16 85 79 8.64
7
Amount of the previous period
Unit: RMB/CNY
Semi-annual of 2021
Owners’ equity attributable to the parent Company
Other
equity instrument Other
Minorit
Perp Less: compr Provisi Total
Item Share Reaso Surplu Retain y
etual Capital Invent ehensi on of Subtot owners’
capita Prefe nable s ed Other interest
capit reserve ory ve genera al equity
l rred Other reserve reserve profit s
al shares incom l risk
stock e
secur
ities
-
I. The ending 266,0 284,05 21,908 343,99 903,24 1,065,5
12,783 162,274
balance of the 71,32 4,997. ,064.1 7,929. 8,772. 23,763.
previous year ,539.1 ,990.49
0.00 75 9 71 52 01
3
Add: Changes
of accounting
policy
Error correction
of the last
period
Enterprise
combine under
the same
control
Other
14
II. The -
266,0 284,05 21,908 343,99 903,24 1,065,5
beginning 12,783 162,274
71,32 4,997. ,064.1 7,929. 8,772. 23,763.
balance of the ,539.1 ,990.49
current year 0.00 75 9 71 52 01
3
III. Increase/ -
Decrease in the - - - -
181,14 11,245
period 2,466, 8,959, 7,342,6 18,587,
(Decrease is 4.49 ,002.1
775.62 371.06 59.06 661.25
listed with “-”) 9
-
(i) Total - - - -
11,426
comprehensive 2,466, 8,959, 7,342,6 18,768,
income ,146.6
775.62 371.06 59.06 805.74
8
(ii) Owners’
devoted and
decreased
capital
1.Common
shares invested
by shareholders
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity
with share-
based payment
4. Other
(iii) Profit
distribution
1. Withdrawal
of surplus
reserves
2. Withdrawal
of general risk
provisions
3. Distribution
for owners (or
shareholders)
4. Other
(iv) Carrying
forward
internal
owners’ equity
1. Capital
reserves
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
capital)
3. Remedying
loss with
surplus reserve
4. Carry-over
retained
earnings from
the defined
15
benefit plans
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(v) Reasonable 181,14 181,14 181,144
reserve 4.49 4.49 .49
1. Withdrawal
541,94 541,94 541,941
in the report
period 1.58 1.58 .58
2. Usage in the 360,79 360,79 360,797
report period 7.09 7.09 .09
(vi) Others
-
VI. Balance at 266,0 284,05 21,908 335,03 892,00 1,046,9
15,250 181,14 154,932
the end of the 71,32 4,997. ,064.1 8,558. 3,770. 36,101.
period ,314.7 4.49 ,331.43
0.00 75 9 65 33 76
5
8. Statement of Changes in Owners’ Equity (Parent Company)
Current Amount
Unit: RMB/CNY
Semi-annual of 2022
Other
equity instrument Other
Perpet Less: Reasona Total
Item Share Capital compreh Surplus Retaine
capital Preferr ual reserve
Inventor ble Other owners’
ed capital Other y shares ensive reserve reserve d profit equity
stock securiti income
es
I. The ending 266,07 -
279,115, 19,184,6 534,274,3
balance of the 1,320.0 30,097,
previous year 900.17 72.34 36.06
0 556.45
Add: Changes
of accounting
policy
Error
correction of the
last period
Other
II. The 266,07 -
beginning 279,115, 19,184,6 534,274,3
1,320.0 30,097,
balance of the 900.17 72.34 36.06
current year 0 556.45
III. Increase/ - -
Decrease in the
10,216, 10,216,83
period (Decrease
is listed with “-”) 831.03 1.03
(i) Total - -
comprehensive 10,216, 10,216,83
income 831.03 1.03
(ii) Owners’
devoted and
decreased capital
1.Common
shares invested
by shareholders
16
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity
with share-based
payment
4. Other
(iii) Profit
distribution
1. Withdrawal of
surplus reserves
2. Distribution
for owners (or
shareholders)
3. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital
reserves
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
capital)
3. Remedying
loss with surplus
reserve
4. Carry-over
retained earnings
from the defined
benefit plans
5. Carry-over
retained earnings
from other
comprehensive
income
6. Other
(v) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(vi) Others
VI. Balance at 266,07 -
279,115, 19,184,6 524,057,5
the end of the 1,320.0 40,314,
period 900.17 72.34 05.03
0 387.48
Amount of the previous period
Unit: RMB/CNY
Semi-annual of 2021
Other
Other
equity instrument Less: Total
Item Share Capital compre Reasonab Surplus Retained
capital
Preferr Perpet
reserve
Inventor Other owners’
ed ual Other y shares hensive le reserve reserve profit
equity
income
stock capital
17
securit
ies
I. The ending 266,07 -
279,115, 19,184, 526,916,01
balance of the 1,320. 37,455,87
previous year 900.17 672.34 8.26
00 4.25
Add:
Changes of
accounting
policy
Error
correction of
the last period
Other
II. The 266,07 -
beginning 279,115, 19,184, 526,916,01
1,320. 37,455,87
balance of the 900.17 672.34 8.26
current year 00 4.25
III. Increase/
Decrease in the - -
period 10,918,62 10,918,628.
(Decrease is 8.07 07
listed with “-”)
(i) Total - -
comprehensive 10,918,62 10,918,628.
income 8.07 07
(ii) Owners’
devoted and
decreased
capital
1.Common
shares invested
by shareholders
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity
with share-
based payment
4. Other
(iii) Profit
distribution
1. Withdrawal
of surplus
reserves
2. Distribution
for owners (or
shareholders)
3. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital
reserves
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
18
capital)
3. Remedying
loss with
surplus reserve
4. Carry-over
retained
earnings from
the defined
benefit plans
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(v) Reasonable
reserve
1. Withdrawal
in the report
period
2. Usage in the
report period
(vi) Others
VI. Balance at 266,07 -
279,115, 19,184, 515,997,39
the end of the 1,320. 48,374,50
period 900.17 672.34 0.19
00 2.32
III. Company profile
1. Registered capital, enterprise registration place, organization form and headquarters address
Shandong Zhonglu Oceanic Fisheries Co., Ltd. (hereinafter referred to as “Company” or “the Company”) with its
HQ address: 25/F, No.1 Building Conson Financial Center, No.31 Xianxialing Road, Laoshan District, Qingdao,
Shandong Province, was incorporated as a joint stock limited company in the People’s Republic of China on 30
July 1999 according to the documentation of Lu Ti Gai Zi [1999] No.85 issued by Shandong Development and
Reform Commission, and the holding company of the Company is Shandong Fisheries Enterprise Group General
Corporation, the main sponsor. On 26 June 2000, being approved by the documentation of Zheng Jian Fa Xing Zi
[2000] No.82 issued by the China Securities Regulatory Commission, the Company’s B-share, stock ID “Zhonglu
B”, stock code “200992” are listing for trading on Shenzhen Stock Exchange dated 24 July 2000.
Basic organization structure of the Company: Shareholder General Meeting, BOD, Supervisory Committee,
Office of the GM (Office of the Party Committee), Departments of HR(Organization Dept.), Financial
Management Dept. (Capital Operation Dept.), Enterprise Development Dept., Auditing Dept., Oceanic
Management Dept., Office of the Discipline Inspection Commission, Party-Masses Relationship Dept. and Risk
Control Dept. (Legal Affairs Dept.).
2. Business nature and main business activities of Enterprise
Corporate industry: ocean-going fisheries
Corporate major products: tuna and its products
Operating scope: general management projects: sales and processing of aquatic products; merchandise import and
19
export business within approved scope; ice machine manufacture and sale; refrigeration equipment manufacturing,
installation, maintenance; refrigeration; load and unload services; housing lease.
Pre-license operation: offshore fishing and pelagic fishing.
3. Parent Company and ultimate parent company of the Group
Shandong State-owned Assets Investment Holdings Co., Ltd.
4. Reporter approves the financial report for disclosed and date for report
The financial report has been approved for report by the Board dated 25 August 2022.
As of June 30, 2022, consolidation scope of the Company including 5 secondary enterprises, 4 three-tier
enterprises and one operation entity with controlling rights obtained through operating lease.
5 secondary enterprises:Shandong Zhonglu Fishery Shipping Co., Ltd., Shandong Zhonglu Oceanic (Yantai)
Foods Co., Ltd., HABITAT INTERNATIONAL CORPORATION, Shandong Zhonglu Haiyan Deep-sea Fishery
Co., Ltd and Zhonglu Oceanic (Qingdao) Industrial Investment Development Co., Ltd.; 4 three-tier
enterprises:LAIF FISHERIES COMPANY LIMITED, Shandong Zhonglu Ocean Refrigerated Co., Ltd, AFRICA
STAR FISHERIES LIMITED and ZHONG GHA FOODS COMPANY LIMITED; one operation entity with
controlling rights obtained through operating lease: YAW ADDO FISHERIES COMPANY LIMITED.
Consolidate scope of the financial report and its changes found more in Note “VIII. Change of Consolidate Scope”
and “IX. Equity in Other entity”
IV. Preparation basis of Financial Statements
1. Preparation basis
The Company prepares financial statements on a going concern basis and maintains the accounts on an accrual
basis. Generally, the Company measures accounting elements by historical costs and measuring with
replacement cost, net realizable value, present value and fair value to ensure that the amounts of the accounting
elements identified can be obtained and measured reliably.
2. Going concern
The Company have the ability to continue as a going concern within 12 months at least since end of the reporting
period, there are no major events that impact the ability to continue as a going concern
V. Important accounting policy and estimation
Notes on specific accounting policies and accounting estimation:
20
According to actual production and operation characteristics and regulation of relevant accounting standards for
enterprises, the Company and its subsidiaries, formulated a variety of specific accounting policies and estimations
in aspect of the transaction and events such as provision for bad debts of the receivable, valuation method of
inventory, depreciation of the fixed assets, amortization of intangible assets, revenue recognition etc.
1.Statement of compliance with the Accounting Standards for Business Enterprises (ASBE)
Financial statement and notes of the Company, have been prepared in accordance with the Accounting Standards
for Business Enterprises issued by Ministry of Finance, the Application Guidance, Interpretation of ASBE, the
Rules Governing the Preparation of Information Disclosure by Companies that Publicly Issuing Securities
No.15-Genral Provisions on Financial Report [Revised 2014] issued by CSRC and relevant supplementary
provisions, and presents a true and complete information of the Company in aspect of financial status, operation
results, shareholders’ equity and cash flows.
2. Accounting period
The Company’s accounting year is Gregorian calendar year, from 1st January to 31st December of every year.
3. Business cycle
The Company’s business cycle is one year (12 months) as a normal cycle, and the business cycle is the
determining criterion for the liquidity of assets and liabilities of the Company.
4. Bookkeeping standard currency
The Renminbi (RMB) is taken as the book-keeping standard currency
5. Accounting methods for consolidation of enterprises under the same control or otherwise
(1) In a business combination under the same control, if the company, as the acquirer, acquires control over other
participating enterprises, and pays cash, transfers non-cash assets or assumes debts as the consideration transferred,
the share of the book value of the owner's equity of the combined party in the consolidated financial statements of
the ultimate controlling party shall be deemed as the initial investment cost of long-term equity investment on the
combining date, and the difference between the initial investment cost of long-term equity investment and the
book value of cash paid, non-cash assets transferred and debts assumed shall adjust the capital reserve; if the
capital reserve is insufficient to offset, the retained earnings shall be adjusted. If the issuance of equity securities is
taken as the consideration transferred, the share of the book value of the owner's equity of the combined party in
the consolidated financial statements of the ultimate controlling party shall be deemed as the initial investment
cost of long-term equity investment on the combining date, and the total face value of the issued shares shall be
21
deemed as the share capital, the difference between the initial investment cost of long-term equity investment and
the total face value of the issued shares shall adjust the capital reserve; if the capital reserve is insufficient to offset,
the retained earnings shall be adjusted. In a business combination, expenses incurred for the services of
intermediaries such as auditing, legal services and valuation consultation as well as other related management fees
shall be included in the current profit and loss when they occur. The bonds issued for a business combination. or
the handling fees and commissions paid for assuming other debts shall be included in the initial measurement
amount of the issued bonds and other debts. The handling fees, commissions and other expenses from issuing
equity securities in a business combination shall be deducted from the premium income of equity securities, and if
the premium income is insufficient to offset, the retained earnings shall be offset.
(2) Where the external combination of the company is a business combination not under the same control, the
initial investment cost of long-term equity investment shall be determined according to the following conditions:
① For a business combination realized by an exchange transaction, the initial investment cost of long-term equity
investment is the fair value of the assets paid, the liabilities incurred or assumed, and the equity securities issued
by the purchaser to obtain the control right over the acquiree on the acquisition date;
② For a business combination realized step by step through multiple exchange transactions, the initial investment
cost of long-term equity investment is the sum of each single transaction cost;
③ In a business combination, expenses incurred for the services of intermediaries such as auditing, legal services
and valuation consultation as well as other related management fees shall be included in the current profit and loss
when they occur; transaction costs of equity securities or debt securities issued as consideration transferred shall
be included in the initial recognition amount of the equity securities or the debt securities;
④ Where the future events that may affect the combined cost are stipulated in the contract or agreement of
combination, if it is estimated that the future event is likely to occur on the acquisition date and the amount of the
impact on the combined cost can be reliably measured, it shall be included in the initial investment of long-term
equity investment
(3) Where the company's external combination is a business combination not under the same control, the amount
that the initial investment cost of the long-term equity investment is greater than the fair value share of the
acquiree's identifiable net assets obtained in the combination shall be recognized as goodwill.
The amount that the initial investment cost of the long-term equity investment is smaller than the fair value share
of the identifiable net assets of the acquiree obtained in the combination shall be handled according to the
following methods:
① Review the fair value of the acquired identifiable assets, liabilities and contingent liabilities of the acquiree and
the measurement of the combined cost;
② After the review, if the combined cost is still less than the fair value share of the identifiable net assets of the
acquiree obtained in the combination, the difference shall be included in the current profit and loss.
22
6. Preparation methods for consolidated financial statements
The scope of consolidation in the consolidated financial statements is determined on the basis of control. Control
means that the investor has power over the investee, enjoys variable returns by participating in the relevant
activities of the investee, and has the ability to use the power over the investee to affect the amount of its return.
The parent company shall include all its subsidiaries into the scope of consolidated financial statements. A
subsidiary refers to the subject controlled by the company (including the divisible part of the enterprise or the
invested unit, and the structured subject controlled by the enterprise, etc.).
If the parent company is an investment subject, the parent company should only incorporate subsidiaries (if any)
that provide relevant services for its investment activities into the scope of consolidation and prepare consolidated
financial statements; other subsidiaries should not be consolidated, and the parent company's investment in other
subsidiaries shall be measured at fair value and its changes shall be included in the current profit and loss. When
the parent company meets the following conditions at the same time, the parent company is an investment subject:
(1)
(2) the parent company obtains funds from one or more investors for the purpose of providing investment
management services to investors;
(3)
(2) the sole purpose of the parent company's business is to provide returns to investors through capital
appreciation, investment income, or both;
(3) the parent company measures and evaluates the performance of nearly all investments at fair value.
In preparing the consolidated statements, the company and the consolidated subsidiaries adopt unified accounting
policies and periods. The consolidated financial statements are based on the financial statements of the company
and its subsidiaries, and are prepared by the company after offsetting the impact of the internal transactions
between the company and its subsidiaries and among the subsidiaries on the consolidated financial statements. For
a subsidiary added due to the business combination under the same control during the reporting period, the
company shall adjust the opening balance of the consolidated balance sheet when preparing the consolidated
balance sheet. For a subsidiary added due to the a business combination not under the same control, the opening
balance of the consolidated balance sheet shall not be adjusted when preparing the consolidated balance sheet. For
a subsidiary added due to the business combination under the same control during the reporting period, the
company shall incorporate the income, expenses, profit and cash flow of the subsidiary from the beginning of the
consolidation period to the end of the reporting period into the consolidated income statement and cash flow
statement. For a subsidiary added due to the business combination not under the same control, the income,
expenses, profit and cash flow from the acquisition date of the subsidiary to the end of the reporting period shall
be incorporated in the consolidated income statement and cash flow statement. If the company disposed of a
subsidiary during the reporting period, it shall incorporate the subsidiary's income, expenses, profits and cash
flows from the beginning of the year to the disposal date into the consolidated income statement and cash flow
statement.
23
When the parent company acquires the equity of a subsidiary owned by the minority shareholders of the
subsidiary, in the consolidated financial statements, the difference between the newly acquired long-term equity
investment due to the acquisition of minority interest and the net assets shares entitled to the subsidiary’s
continuous calculation from the date of acquisition or the date of consolidation based on the newly added
shareholding ratio shall adjust the capital reserve (capital premium or share premium), and if the capital reserve is
insufficient to offset, the retained earnings shall be adjusted.
The parent company partially disposes of the long-term equity investment in the subsidiary without losing control,
in the consolidated financial statements, the difference between the disposal cost and the net assets shares entitled
to the subsidiary’s continuous calculation from the date of acquisition or the date of consolidation corresponding
to the disposal of long-term equity investment shall adjust the capital reserve (capital premium or share premium),
and if the capital reserve is insufficient to offset, the retained earnings shall be adjusted.
Where an enterprise loses control over the investee due to disposal of part of the equity investment, when
preparing the consolidated financial statements, the remaining equity shall be re-measured according to its fair
value on the date of loss of control. The sum of the consideration obtained from the disposal of the equity and the
fair value of the remaining equity, minus the net assets shares entitled to the original subsidiary’s continuous
calculation from the date of acquisition or the date of consolidation based on the original shareholding ratio, and
the difference shall be included in the investment income in the current period of loss of control, and shall write
down the goodwill at the same time. Other comprehensive income related to the original subsidiary's equity
investment shall be converted into investment income for the current period when the control is lost, except for
other comprehensive income arising from changes in net liabilities or net assets of defined benefit plans
remeasured by the investee.
7. Classification of joint arrangements and accounting treatment of joint ventures
Joint arrangements are classified as joint operations and joint ventures.
A joint operation refers to a joint arrangement in which the joint venture party enjoys the relevant assets of the
arrangement and assumes the relevant liabilities of the arrangement. The company recognizes the following items
related to its share of interests in the joint operation, and conducts accounting treatment in accordance with the
relevant provisions of the accounting standards for business enterprises:
(1) Recognize the assets held individually, and the assets held jointly by their shares;
(2) Recognize the liabilities borne individually, and the liabilities borne jointly by their shares;
(3) Recognize the income from the sale of their shares of the output of the joint operation;
(4) Recognize the income of the joint operation from the sale of output by their shares;
(5) Recognize the expenses incurred individually, and the expenses incurred by the joint operation by their shares.
24
A joint venture refers to a joint arrangement in which the joint venture party only has rights to the net assets of the
arrangement. The company conducts accounting treatment for the investments in the joint venture in accordance
with the equity method.
8. Determination criteria of cash and cash equivalent
Cash is defined as cash on hand and deposits readily available for disbursement. Cash equivalent are
investments held by the Company with short maturities and high liquidity, easily convertible to known amounts
of cash, and with minimal risk of changes in value.
9. Foreign currency exchange and the conversion of foreign currency statements
(1) On initial recognition, the foreign currency transactions are recorded in local currency using an exchange
rate approximating the spot rate on the date of transaction.
(2) On the balance sheet date, foreign currency monetary items and foreign currency non-monetary items are dealt
with according to the following methods:
① Foreign currency monetary items are converted at the spot exchange rate of the balance sheet. The exchange
difference arising from the difference between the spot exchange rate on the balance sheet date and the spot
exchange rate at the time of initial recognition or on the previous balance sheet date is included in the current
profit and loss.
② Foreign currency non-monetary items measured at historical cost are still converted at the spot exchange rate
on the date of the transaction, without changing the amount in the local reporting currency; foreign currency non-
monetary items measured at fair value are converted at the spot exchange rate on the date when the fair value is
determined, the difference between the amount in converted local reporting currency and the amount in original
functional currency is treated as a change in fair value (including exchange rate changes), and is included in the
current profit and loss or other comprehensive income according to the nature of non-monetary items.
Monetary items refer to the monetary funds held by the company and the assets to be collected or the liabilities to
be paid in fixed or determinable amounts.
Non-monetary items refer to items other than monetary items.
(3) Translation method of foreign currency financial statements of overseas operating entities:
① Assets and liabilities items in the balance sheet are translated at the spot exchange rate on the balance sheet
date, and except the "undistributed item, other items of the owner's equity items are translated at the spot
exchange rate at the time of occurrence;
25
② The income and expense items in the income statement are translated at the approximate exchange rate of the
spot exchange rate on the transaction date;
③ The translation difference of the foreign currency financial statements resulting from the above (3) ① and ②
translations shall be listed separately under the owner's equity item in the balance sheet.
(4) The company shall convert the financial statements of overseas operations in a hyperinflation according to the
following methods:
The balance sheet items are restated using the general price index, and the income statement items are restated
using the changes in the general price index, and then converted at the spot exchange rate on the most recent
balance sheet date.
When the overseas operation is no longer in a hyperinflation, the restatement shall be stopped, and the restated
financial statements shall be converted according to the price level on the date of cessation.
(5) When the company disposes of an overseas operation, it shall transfer the conversion difference in the foreign
currency financial statement, which is listed under the owner's equity item in the balance sheet and related to the
overseas operation, into the current profit and loss from the owner's equity item; Where the overseas operation is
partially disposed of, the translation difference of the foreign currency financial statements of the disposed part
shall be calculated according to the proportion of disposal, and transferred into the current profit and loss of
disposal.
10. Financial instruments
Financial instruments refer to contracts that form financial assets of one party and financial liabilities or equity
instruments of other parties. When a company becomes a party to a financial instrument contract, the related
financial assets or financial liabilities are recognized.
(1)Financial assets
① Classification and initial measurement
Based on the business model for managing the financial assets and the contractual cash flow characteristics of the
financial assets, the company divides financial assets into:
Financial assets measured at amortized cost;
Financial assets at fair value through other comprehensive income;
Financial assets at fair value through profit or loss.
Financial assets are measured at fair value on initial recognition. For financial assets at fair value through profit or
loss, relevant transaction costs are directly included in current profit and loss; for other types of financial assets,
relevant transaction costs are included in the initial recognition amount. For accounts receivable or notes
receivable arising from the sale of products or provision of labor services that do not include or consider
26
significant financing components, the amount of consideration that the company is expected to be entitled to
receive is taken as the initial recognition amount
1) Debt instruments
The debt instruments held by the company refer to the instruments that meet the definition of financial liabilities
from the perspective of the issuer, and are measured in the following three methods:
(1)Measured at amortized cost:
The company's business model for managing such financial assets is to collect contractual cash flows, and the
contractual cash flow characteristics of such financial assets are consistent with the basic lending arrangements,
that is, the cash flows generated on a specific date are only payments of principal and interest based on the amount
of outstanding principal amount. For such financial assets, the company recognizes interest income according to
the effective interest method. Such financial assets mainly include monetary funds, notes receivable and accounts
receivable, contract assets, other receivables, debt investments, lease receivables and long-term receivables. The
company lists debt investments and long-term receivables due within one year (including one year) from the
balance sheet date as non-current assets due within one year. Debt investments with a maturity within one year
(including one year) at the time of acquisition are listed as other current assets.
(2)Financial assets at fair value through other comprehensive income;
The company's business model for managing such financial assets is to collect contractual cash flows and sell
them, and the contractual cash flow characteristics of such financial assets are consistent with the basic lending
arrangements. Such financial assets are measured at fair value through other comprehensive income, but
impairment losses or gains, exchange gains and losses, and interest income calculated by the effective interest
method are included in current profit and loss. Such financial assets are listed as other debt investments, and the
other debt investments due within one year (including one year) from the balance sheet date are listed as non-
current assets due within one year; Other debt investments including one year) are listed as other current assets.
Other debt investments with a maturity within one year (including one year) at the time of acquisition are listed as
other current assets.
(3)Financial assets at fair value through profit or loss.
For debt instruments held by the company, which are neither classified to be measured at amortized cost and nor
classified to be measured at fair value and with changes included in other comprehensive income, are measured at
fair value and whose changes are included in current profits and losses, and are listed as trading financial assets.
At initial recognition, in order to eliminate or significantly reduce accounting mismatch, the company designates
some financial assets as financial assets measured at fair value and whose changes are included in current profit
and loss. Those that are due more than one year from the balance sheet date and are expected to be held for more
than one year are listed as other non-current financial assets.
27
2) Equity instruments
The company measures the equity instrument investments which have no control, joint control over it nor
significant influence on it at fair value and the changes are included in the current profit and loss, and list as
trading financial assets; the equity instrument investments expected to be held for more than one year from the
balance sheet date are listed as other non-current financial assets.
In addition, the company designates some non-trading equity instrument investments as financial assets measured
at fair value through other comprehensive income, and lists them as other equity instrument investments. The
relevant dividend income of such financial assets is included in the current profit and loss. Once made, the
designation cannot be revoked. Where the contingent consideration recognized by the Company in a business
combination not under the same control constitutes a financial asset, the financial asset is classified as a financial
asset measured at fair value and whose changes are included in the current profit and loss.
For non-trading equity instrument investments, the company may irrevocably designate it as financial assets at fair
value through other comprehensive income at initial recognition. The designation is made on an individual
investment basis, and the relevant investment meets the definition of an equity instrument from the issuer's
perspective.
② Impairment
For financial assets measured at amortized cost, debt instrument investments measured at fair value through other
comprehensive income, lease receivables, contract assets and financial guarantee contracts, etc., the company
recognizes loss provision based on expected credit losses. The company considers reasonable and evidence-based
information about past events, current conditions, and forecasts of future economic conditions, and takes the risk
of default as the weight to calculate the probability-weighted amount of the present value of the difference
between the cash flows receivable from the contract and the cash flows expected to be received, and recognizes
expected credit losses.
On each balance sheet date, the company separately measures the expected credit losses of financial instruments
in different stages. Where the credit risk of a financial instrument has not increased significantly since the initial
recognition, the financial instrument is in the first stage, and the company measures the loss provision based on
the expected credit loss in the next 12 months; where the credit risk of a financial instrument has increased
significantly since the initial recognition but no credit impairment has occurred yet, the financial instrument is in
the second stage, and the company measures the loss provision based on the expected credit loss of the entire
duration of the instrument; where a financial instrument has suffered credit impairment since the initial
recognition, it is in the third stage, and the company measures the loss provision based on the expected credit loss
of the entire duration of the instrument.
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For a financial instrument with low credit risk on the balance sheet date, the company assumes that its credit risk
has not increased significantly since the initial recognition, and measures the loss provision based on the expected
credit loss in the next 12 months.
For financial instruments in the first and second stages and with relatively low credit risk, the company calculates
interest income based on its book balance before deduction of provisions for impairment and the actual interest
rate. For a financial instrument in the third stage, interest income is calculated based on the amortized cost after
deducting the accrued provision for impairment from its book balance and the effective interest rate.
For notes receivable and accounts receivable, lease receivables and contract assets, regardless of whether there is a
significant financing component, the company can measure the loss provision based on the expected credit loss of
the entire duration.
1) Judgment criteria for a significant increase in credit risk
On each balance sheet date, the company evaluates whether the credit risk of relevant financial instruments has
increased significantly since initial recognition.
In determining whether credit risk has increased significantly since initial recognition, the company considers
reasonable and evidence-based information that can be obtained without unnecessary additional cost or effort,
including qualitative and quantitative analysis based on the company's historical data, external credit risk ratings
and forward-looking information. Based on a single financial instrument or a financial instruments portfolio with
similar credit risk characteristics, the company compares the risk of default of financial instruments on the balance
sheet date with the risk of default on the date of initial recognition to determine the change in the risk of default
during the expected duration of of financial instruments.
The company believes that a significant increase in the credit risk of a financial instrument has occurred when one
or more of the following quantitative or qualitative criteria are triggered:
(1) The quantitative criteria are mainly that the probability of default of the remaining duration on the reporting
date increases by more than a certain proportion compared with the initial recognition.
(2) The qualitative criteria are mainly the significant adverse changes in the debtor's business or financial situation,
the list of early warning customers, etc.
(3) The upper limit indicator is that the debtor's contractual payment (including principal and interest) is generally
overdue for more than 90 days, and the longest is not more than 180 days.
2) Definition of credit-impaired assets
In order to determine whether there is credit impairment, the company adopts definition standards that are
consistent with the internal credit risk management objectives for relevant financial instruments, and considers
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quantitative and qualitative indicators. When assessing whether the debtor has suffered credit impairment, the
company mainly considers the following factors:
(1) Significant financial difficulty of the issuer or debtor
(2) Breach of contract of the debtor, such as default or overdue payment of interest or principal;
(3) Concessions that the creditor would not have made under any other circumstances out of economic or
contractual considerations related to the debtor's financial hardship;
(4) The debtor is likely to go bankrupt or carry out other financial restructuring;
(5) The financial difficulties of the issuer or debtor lead to the disappearance of the active market for the financial
asset;
(6) Purchase or originate a financial asset at a substantial discount that reflects the fact that a credit loss has
occurred.
Credit-impaired financial assets may be caused by the combined action of multiple events, not necessarily by a
individually identifiable event.
3) Parameters of expected credit loss measurement
Based on whether there has been a significant increase in credit risk and whether credit impairment has occurred,
the company measures the impairment provision for different assets with the expected credit loss of 12 months or
the entire duration. Key parameters for expected credit loss measurement include probability of default, loss given
default and exposure at default. The company considers quantitative analysis and forward-looking information of
historical statistical data (such as counterparty ratings, guarantee methods, types of collateral and pledges,
repayment methods, etc.) to establish models for probability of default, loss given default and exposure at default.
Relevant definitions are as follows:
(1) Probability of default refers to the possibility that the debtor will not be able to perform its repayment
obligations in the next 12 months or throughout the remaining duration. The company's probability of default is
adjusted based on the historical credit loss model results, and forward-looking information is added to reflect the
debtor's probability of default in the current macroeconomic environment;
(2) Loss given default refers to the company's expectation on the loss degree of exposure at default. Loss given
default varies depending on the type of counterparty, method and priority of recourse, and the difference in
collateral. Loss given default is the percentage of loss of the exposure at default, which is calculated on the basis
of the next 12 months or the entire duration;
(3) Exposure at default refers to the amount that the company should be paid when a default occurs in the next 12
months or the entire remaining duration.
4) Forward-looking information
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Both the assessment of a significant increase in credit risk and the calculation of expected credit losses involve
forward-looking information. Through historical data analysis, the company identifies key economic indicators
that affect the credit risk and expected credit loss of various business types.
When a single financial asset cannot assess the expected credit loss information at a reasonable cost, the company
divides the receivables into several portfolios according to the credit risk characteristics, and calculates the
expected credit loss on the basis of the portfolios. The basis for determining the portfolios is as follows:
Item Basis for determining portfolio Measurement of expected credit losses
Calculate the expected credit losses by referring to
historical credit loss experience, combining current
Bank acceptance receivable Note acceptor conditions and forecasts of the future economic
conditions, through default exposures and expected
credit loss rates over the entire duration
Commercial acceptance
Note acceptor Age analysis
receivable
Bad debt provision measured by referring to
Account receivable—Related historical credit loss experience and in relation to
Enterprises in consolidate scope
party portfolio current conditions and expectations of future
economic conditions
Account receivable—External
Enterprises out of the consolidate scope and Accrual based on the comparison table of aging of
client portfolio
the third party clients the account and expected credit loss rate of the entire
Leasing receivable—External
duration
client portfolio
Accrual based on the comparison table of aging of
Contract assets—External client Enterprises out of the consolidate scope and
the account and expected credit loss rate of the entire
portfolio the third party clients
duration
Bad debt provision measured by referring to
Other receivable—Related party historical credit loss experience and in relation to
Enterprises in consolidate scope
portfolio current conditions and expectations of future
economic conditions
Other receivable—External Enterprises out of the consolidate scope and Provision for losses is measured in line with the
client portfolio the third party clients general approach, namely “three-stage” model
Long-term receivable —External Enterprises out of the consolidate scope and Provision for losses is measured in line with the
client portfolio the third party clients general approach, namely “three-stage” model
Comparison table of aging of the account and expected credit loss rate (Portfolio of account receivable and
leasing receivable)
Account age Expected credit loss rate (%)
Within 6 months 5.00
6 months to one year 10.00
1-2 years 30.00
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2-3 years 50.00
over 3 years 100.00
For other receivables divided into portfolios, the company refers to historical credit loss experience, combines
with current conditions and forecasts of future economic conditions, and calculate the expected credit loss from
exposure at default and expected credit loss rate within the next 12 months or the entire duration.
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the company
and its subsidiaries re-measure the expected credit losses on each balance sheet date, and the resulting increase in
loss provision or amount transferred back shall be regarded as impairment losses or gains and included in the
current profit and loss. For a financial asset measured at amortized cost, the loss provision offsets the book value
of the financial asset listed in the balance sheet; for a debt investment measured at fair value through other
comprehensive income, the company and its subsidiaries recognize its loss provision in other comprehensive
income without offsetting the book value of the financial asset.
③ Derecognition
A financial asset that meets one of the following conditions shall be derecognized:
1) The contractual right to receive the cash flow of the financial asset is terminated;
2) The financial asset has been transferred, and the company has transferred almost all the risks and rewards of
ownership of the financial asset to the transferee;
3) The financial asset has been transferred, the company neither transfers nor retains almost all the risks and
rewards of ownership of the financial asset, but has given up the control over the financial asset.
When other equity instrument investments are derecognized, the difference between their book value and the sum
of the consideration received and the cumulative amount of changes in fair value originally included in other
comprehensive income is included in the retained earnings; when the other financial assets are derecognized, the
difference between their book value and the sum of the consideration received and the accumulated amount of
changes in fair value originally included in other comprehensive income is included in the current profit and loss.
④Write-off
Where the company and its subsidiaries no longer reasonably expect that the contractual cash flow of the financial
asset can be recovered in whole or in part, the book balance of the financial asset will be written down directly.
This write-down constitutes derecognition of the underlying financial asset. This usually occurs when the
company and its subsidiaries determine that the debtor has no assets or sources of income to generate sufficient
cash flow to repay the amount that will be written down. However, the written-down financial asset may still be
affected by enforcement activities in accordance with the company and its subsidiaries' procedures for recovering
amounts due.
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Where the written-down financial asset is recovered later, it shall be included in the current profit and loss as the
reversal of impairment loss.
(2) Financial liabilities
Financial liabilities are classified into financial liabilities measured at amortized cost and financial liabilities at
fair value through profit or loss at initial recognition.
Except for the following items, the company classifies financial liabilities as financial liabilities measured at
amortized cost:
① Financial liabilities measured at fair value through profit or loss for the current period, including financial
liabilities held for trading (including derivatives that are financial liabilities) and financial liabilities designated as
measured at fair value through profit or loss for the current period.
② Financial liabilities of which the transfer of financial assets does not meet the conditions for derecognition or
continuing to be involved in the transferred financial assets.
③ Financial guarantee contracts that do not fall under the conditions of item ① or ② of the present article, and
loan commitments that do not fall under the conditions of item ① of the present article and make loans at a lower-
than-market interest rate. In a business combination not under the same control, if the contingent consideration
recognized by the company as the acquirer forms a financial liability, the financial liability shall be measured at
fair value and its changes shall be included in the current profit and loss for accounting treatment.
At the time of initial recognition, in order to provide more relevant accounting information, the company can
designate a financial liability as the financial liability measured at fair value through profit or loss for the current
period, and the designation meets one of the following conditions:
1) Accounting mismatches can be eliminated or significantly reduced.
2) According to the enterprise risk management or investment strategy stated in official written document, manage
and evaluate the financial liabilities portfolio or financial assets and financial liabilities portfolio on the basis of
fair value, and report to key management personnel on this basis within the company. Once made, the designation
cannot be revoked.
The company's financial liabilities are mainly financial liabilities measured at amortized cost, including notes
payable and accounts payable, other payables, loans and bonds payable. Such financial liabilities are initially
measured at their fair value after deducting transaction costs, and are subsequently measured using the effective
interest method. Those with a term of less than one year (including one year) are listed as current liabilities; those
with a term of more than one year but due within one year (including one year) from the balance sheet date are
listed as non-current liabilities due within one year; the rest are listed as non-current liabilities.
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When all or part of the current obligations of a financial liability have been discharged, the company derecognizes
the financial liability or the part of which the obligation has been discharged. The difference between the book
value of the derecognized part and the consideration paid is included in the current profit and loss.
Where the current obligation of a financial liability (or a part of it) has been discharged, the company shall
derecognizes the financial liability (or financial liability of this part).
(3) Determination of fair value of financial instruments
Where there is an active market for a financial instrument, the quoted price in the active market are used to
establish its fair values. Where there is no active market for a financial instrument, valuation techniques are used
to establish its fair value. When valuing, the company adopts valuation techniques that are applicable under the
current conditions and that there are sufficient available data and other information to support, and selects input
values that are consistent with the characteristics of the asset or liability considered by market participants in the
transaction of the relevant asset or liability, and use relevant observable input values preferentially whenever
possible. Unobservable input values are used when the relevant observable input values are unavailable or
impractical to obtain.
(4) Subsequent measurement
After the initial recognition, the company conducts subsequent measurement for different types of financial assets
at amortized cost, at fair value through other comprehensive income, or at fair value through profit or loss.
After the initial recognition, the company conducts subsequent measurement for different types of financial
liabilities at amortized cost, at fair value through other comprehensive income, or at fair value through profit or
loss.
The amortized cost of a financial asset or financial liability is determined by the initial recognition amount of the
financial asset or financial liability after the following adjustments:
①Deduct the repaid principal.
②Add or subtract the accumulated amortization amount formed by amortizing the difference between the initially
recognized amount and the amount on the maturity date using the effective interest method.
③ Deduct the accumulated loss provision (applicable only to financial assets).
The company recognizes interest income by the effective interest method. Interest income is calculated by
multiplying the book balance of financial assets by the actual interest rate, except in the following cases:
1) For the acquired or originated credit-impaired financial assets, the company shall calculate its interest income
based on the amortized cost of the financial assets and the credit-adjusted effective interest rate since the initial
recognition.
2) For the acquired or originated financial assets that have not incurred credit impairment but become credit
impaired in the subsequent period, the company shall calculate and determine the interest income based on the
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amortized cost and effective interest rate of the financial assets in the subsequent period. Where the company
calculates and determines the interest income by using the effective interest method on the amortized cost of
financial assets in accordance with the above policies, if the financial instrument is no longer credit-impaired due
to an improvement in its credit risk in the subsequent period, and the improvement can be objectively linked to an
event that occurred after the application of the above policy (such as an upgrade of the debtor's credit rating), the
company shall calculate and determine the interest income by multiplying the actual interest rate by the book
balance of the financial asset.
11. Note receivable
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
12. Account receivable
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
13. Receivable financing
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
14. Other account receivable
Method of determining the expected credit loss and accounting treatment
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
15. Inventory
(1)Classification of inventory
The inventory include raw materials, work-in-process, semi-finished products, finished goods, merchandise in
stock, working capital materials, low value consumables and contract performance costs, etc.
The “contract performance costs” found in “17. Contract cost”.
(2) Valuation of issued inventories
Inventory is valued on a weighted average basis upon issuance
(3) The basis for determining the net realizable value of inventories and the method for accruing inventory write-
down
On the balance sheet date, inventories are measured at the lower of cost and net realizable value. Where the cost
of inventory is higher than its net realizable value, provision for inventory write down shall be made and included
in the current profit and loss. Net realizable value refers to the amount after subtracting the estimated costs to be
35
incurred upon completion, estimated selling expenses and related taxes from the estimated selling price of
inventories in daily activities.
The basis for determining the net realizable value of various inventories is as follows:
①In the normal production and operation, the net realizable value of inventory directly used for sale, such as
finished products, commodities and materials for sale, etc. , is determined by the amount after deducting the
estimated selling expenses and relevant taxes from the estimated selling price of the inventory.
②In the normal production and operation, the net realizable value of material inventory to be processed shall be
determined by the amount after deducting the estimated cost to be incurred upon completion, estimated sales
expenses and relevant taxes and fees from the estimated selling price of the finished products.
③ On the balance sheet date, where a part of the inventory has contract price agreement and other parts of the
same inventory have no contract price, its net realizable value shall be determined separately, and compared with
its corresponding cost, and the provision for inventory write down and the the amount transferred back shall be
determined separately.
Inventory write-down are accrued based on a single inventory item (or inventory category), where the inventory is
related to product series produced and sold in the same area, has the same or similar end use or purpose, and is
difficult to measure separately from other items, it shall be combined to make provisions for inventory write-down.
(4)Inventory stocking system
The Company adopts perpetual inventory system for stocking.
(5)Amortization of low value consumables and packing materials
The Company adopts fifty amortization method for low value consumables and packing materials.
Note: description of the inventory categories, valuation method of issued inventory, the basis for determining the
net realizable value of different categories of inventories, the inventory system for inventory and the amortization
method for low-value consumable items and packaging.
(1)Classification of inventory
The inventory include raw materials, work-in-process, semi-finished products, finished goods, merchandise in
stock, working capital materials, low value consumables and contract performance costs, etc.
The “contract performance costs” found in “17. Contract cost”.
(2) Valuation of issued inventories
Inventory is valued on a weighted average basis upon issuance
(3) The basis for determining the net realizable value of inventories and the method for accruing inventory write-
down
On the balance sheet date, inventories are measured at the lower of cost and net realizable value. Where the cost
of inventory is higher than its net realizable value, provision for inventory write down shall be made and included
in the current profit and loss. Net realizable value refers to the amount after subtracting the estimated costs to be
36
incurred upon completion, estimated selling expenses and related taxes from the estimated selling price of
inventories in daily activities.
The basis for determining the net realizable value of various inventories is as follows:
①In the normal production and operation, the net realizable value of inventory directly used for sale, such as
finished products, commodities and materials for sale, etc. , is determined by the amount after deducting the
estimated selling expenses and relevant taxes from the estimated selling price of the inventory.
②In the normal production and operation, the net realizable value of material inventory to be processed shall be
determined by the amount after deducting the estimated cost to be incurred upon completion, estimated sales
expenses and relevant taxes and fees from the estimated selling price of the finished products.
③ On the balance sheet date, where a part of the inventory has contract price agreement and other parts of the
same inventory have no contract price, its net realizable value shall be determined separately, and compared with
its corresponding cost, and the provision for inventory write down and the the amount transferred back shall be
determined separately.
Inventory write-down are accrued based on a single inventory item (or inventory category), where the inventory is
related to product series produced and sold in the same area, has the same or similar end use or purpose, and is
difficult to measure separately from other items, it shall be combined to make provisions for inventory write-down.
(4)Inventory stocking system
The Company adopts perpetual inventory system for stocking.
(5)Amortization of low value consumables and packing materials
The Company adopts fifty amortization method for low value consumables and packing materials.
16. Contract assets
(1) Methods and criteria for recognition of contract assets
A contract asset is a right to receive consideration for the commodity that has been transferred to a customer, and
that right depends on factors other than the passage of time. Contract assets and contract liabilities under the same
contract shall be presented on a net basis, and contract assets and contract liabilities under different contracts shall
not be offset.
(2) Determination method and accounting treatment method of expected credit loss of contract assets
The provision for impairment of contract assets shall be made with reference to the expected credit loss method of
financial instruments. For contract assets that do not contain significant financing components, the Company
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adopts the simplified method to measure the loss provision. For contract assets that contain significant financing
components, the company measures the loss provision in accordance with the general method.
In the event of an impairment loss on a contract asset, the “asset impairment loss” shall be debited according to
the amount to be written down, and the provision for impairment of contract asset shall be credited; the reverse
entry shall be made when the accrued allowance for asset devaluation is transferred back.
17. Contract cost
(1)Method of determining the amount of assets that related to contract costs
Assets related to contract costs including the contract performance costs and contract acquisition costs.
The contract performance costs refers to the costs incurred for performance of the contract. As assets is
recognized as a contract performance cost if it does not fall within the scope of other ASBE specifications other
than Accounting Standards for Business Enterprise No.14- Revenue (Revised 2017) and the following
conditions are also met:
①the costs is directly related to a current or anticipated contract, including directly labors, directly materials,
manufacturing costs (or similar costs), costs explicitly borne by the customer, and other costs incurred solely as
a results of the contract;
②the cost increases the future resources available to the enterprise to meet its performance obligations;
③the cost is expected to be recovered.
The contract acquisition cost, where the incremental cost for acquiring the contract is expected to be recovered, it
shall be recognized as an asset as the contract acquisition cost. Incremental costs are costs that would not have
occurred without a contract. Where the amortization period of the asset does not exceed one year, it can be
included in the current profit and loss when it occurs.
Other expenses incurred to acquire the contract, except for the incremental costs that are expected to be recovered,
shall be included in the current profit and loss when they incur, unless these expenses are clearly borne by the
customer.
(2) Amortization of assets related to contract costs
Assets related to contract costs are amortized on the same basis as the commodity revenue recognition related to
the assets, and are included in the current profit and loss.
(3) Impairment of assets related to contract costs
When determining the impairment of assets related to contract costs, first determine the impairment loss for other
assets related to the contract and recognized in accordance with other relevant accounting standards for business
enterprises; if its book value is higher than the difference between the following item ① and item ②, the excess
shall be accrued as an impairment provision and recognized as an asset impairment loss:
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① The remaining consideration that is expected to be acquired from the transfer of goods related to the asset.
②And the estimated cost to be incurred for the transfer of the relevant goods.
If there is a change in the factors of impairment in the previous period, making the difference between the above
item ① and item ② higher than the book value of the asset, the original allowance for asset devaluation shall be
reversed and included in the current profit and loss. However, the book value of the asset after the reversal shall
not exceed the book value of the asset on the date of reversal under the assumption that no provision for
impairment is made.
18. Assets held-for-sale
(1) Recognition criteria for non-current assets held for sale and disposal groups
If the company recovers its book value mainly through sale (including non-monetary assets exchange with
commercial substance, the same below) rather than continuous use of a non-current asset or disposal group, it will
be classified as held for sale. The specific standards are to meet the following conditions at the same time:
①According to the practice of selling such assets or disposal groups in similar transactions, they can be sold
immediately under the current conditions.
② The sale is very likely to occur, that is, the enterprise has made a resolution on a sale plan and obtained a firm
purchase commitment, and the sale is expected to be completed within one year.
Among them, the disposal group refers to a group of assets that are disposed of as a whole in a transaction through
sale or other means, and the liabilities directly related to these assets transferred in the transaction. Where the asset
group or portfolio of asset groups to which the disposal group belongs has apportioned the goodwill obtained in
the business combination in accordance with the Accounting Standards for Business Enterprises No. 8—Asset
Impairment, the disposal group shall include the goodwill apportioned to the disposal group.
(2) Accounting treatment method
When the initial measurement or the remeasurement on the balance sheet date is divided into non-current assets
held for sale and disposal groups, if the book value is higher than the net amount after deducting the selling
expenses from the fair value, the book value shall be written down to the net amount after deducting the selling
expenses from the fair value, the written-down amount shall be recognized as the asset impairment loss and
included in the current profit and loss, and at the same time, the provision for impairment of the assets held for
sale shall be made. For a disposal group, the recognized asset impairment loss is first deducted from the book
value of the goodwill in the disposal group, and then proportionally deducted from the book value of each non-
current asset within the disposal group applicable to the measurement provisions of "Accounting Standards for
Business Enterprises No. 42 - Non-current Assets Held for Sale, Disposal Groups and Discontinued Operations"
39
(hereinafter referred to as "Hold-for-sale Standards"). If the net amount of the disposal group held for sale on the
subsequent balance sheet date increases after deducting the selling expenses from the fair value, the previously
written down amount shall be recovered, and shall be reversed within the amount of assets impairment loss
recognized for non-current assets subject to the measurement provisions of the held-for-sale standard after being
classified as held-for-sale category, and the reversed amount shall be included in the current profit and loss, and
proportionally increase its book value according to the proportion of the book value of each non-current asset in
the disposal group that is measured by the held-for-sale standard except goodwill. The book value of goodwill that
has been written off, and the non-current assets that are subject to the measurement requirements of the held-for-
sale standard shall not be reversed before they are classified as held-for-sale category.
Non-current assets held for sale or non-current assets in disposal groups shall not be depreciated or amortized, and
the interest and other expenses of the liabilities in the disposal group held for sale continue to be recognized.
When the non-current assets or disposal groups no longer meet the classification conditions of the held-for-sale
category, they shall no longer be classified as held-for-sale categories or the non-current assets shall be removed
from the held-for-sale disposal groups, and shall be measured by the lower of the following :
①The book value before being classified as held-for-sale category, the amount adjusted according to the
depreciation, amortization or impairment that should have been recognized under the assumption that it was not
classified as held-for-sale category;
②Amount recoverable.
19. Debt investment
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
20.Other debt investment
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
21.Long-term receivable
Method of determining the expected credit loss and accounting treatment found in Note 10.Financial Instrument
22. Long-term equity investment
Long-term equity investment refers to the equity investment in which the company controls over and has
significant influence on the investee, as well as the investment in its joint ventures.
(1) Determination of investment cost
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Except for the long-term equity investment formed by external combination, the initial investment cost of long-
term equity investment acquired by other means shall be determined in accordance with the following provisions:
① For long-term equity investment acquired by cash payment, the initial investment cost shall be the acquisition
price actually paid. The initial investment cost includes expenses, taxes and other necessary expenses directly
related to the acquisition of long-term equity investment;
② For long-term equity investment acquired by issuing equity securities, the fair value of the equity securities
issued shall be taken as the initial investment cost;
③ For long-term equity investment acquired through non-monetary asset exchange, the initial investment cost
shall be determined in accordance with the Accounting Standards for Business Enterprises No. 7 - Non-monetary
Asset Exchange;
④ For long-term equity investment acquired through debt restructuring, the initial investment cost shall be
determined in accordance with the Accounting Standards for Business Enterprises No. 12 - Debt Restructuring.
(2)Method for subsequent measurement and profit and loss recognition
①The following long-term equity investments are accounted for using the cost method:
Long-term equity investment in which the company can exercise control over the investee.
Long-term equity investments accounted for using the cost method are priced at the initial investment cost.
Additional or recovered investment should adjust the cost of long-term equity investment. Cash dividends or
profits announced to be distributed by the investee are recognized as investment income for the current period.
② Long-term equity investments with joint control (referring to joint ventures) or significant influence over the
investee shall be accounted for using the equity method.
When the long-term equity investment is accounted for using the equity method, if the investment cost of the
long-term equity investment is greater than the share of the fair value of the identifiable net assets of the investee
at the time of investment, the investment cost of the long-term equity investment shall not be adjusted; if the
investment cost of the long-term equity investment is less than the share of the fair value of the identifiable net
assets of the investee at the time of investment, the book value of the long-term equity investment shall be
adjusted, and the difference shall be included in the current profit and loss of the investment.
In equity method accounting, when long-term equity investment is acquired, the profit and loss from investment
and other comprehensive income shall be recognized according to the share of net profit and loss and other
comprehensive income realized by the investee to be enjoyed or shared, and the book value of long-term equity
investment shall be adjusted. The investing enterprise shall calculate the portion that should be distributed
according to the profits or cash dividends declared and distributed by the investee, and correspondingly reduce the
book value of the long-term equity investment. The investor shall adjust the book value of the long-term equity
investment and include it in the owner's equity for other changes in the owner's equity other than the net profit and
loss, other comprehensive income and profit distribution of the investee.
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To confirm the net loss of the investee, the book value of the long-term equity investment and other long-term
equity that substantially constitutes the net investment in the investee shall be written down to zero, unless the
company is obliged to bear additional losses to the investee. If the investee realizes a net profit in the future, the
investing enterprise shall resume the recognition of the profit-sharing amount after its profit-sharing amount
makes up for the unrecognized loss-sharing amount.
For other changes in the owner's equity of the investee other than net profit or loss, other comprehensive income
and profit distribution, the book value of the long-term equity investment shall be adjusted and included in the
owner's equity.
Long-term equity investments are accounted for using the equity method, when recognizing the profit and loss
from investment, first adjust the fair value, accounting policy and accounting period of various identifiable assets
of the investee when the net profit of the investee is acquired, and then recognize the profit and loss from
investment for the current period according to the share of the net profit and loss of the investee to be enjoyed or
shared.
For the unrealized profit and loss from internal transactions with associates and joint ventures, the part attributable
to the company shall be calculated according to the shareholding ratio, and the profit and loss from investment
shall be recognized on the basis of offset.
(3) Basis for determining joint control and significant influence over the investee
Joint control refers to the common control of an arrangement in accordance with relevant agreements, and the
relevant activities of the arrangement must be decided by the unanimous consent of the participants sharing the
control rights. When judging whether there is joint control, first determine whether all participants or participants
portfolios collectively control the arrangement, if all participants or a portfolio of participants must act in concert
to decide the relevant activities of an arrangement, it is considered that all participants or a portfolio of
participants collectively control the arrangement, next, judge whether the decision-making of the relevant
activities of the arrangement must be unanimously agreed by the participants who collectively control the
arrangement. If there are two or more participants portfolios collectively controlling an arrangement, it does not
constitute a joint control. When judging whether there is a joint control, the protective rights enjoyed are not
considered.
Significant influence refers to the powers to participate in the decision-making of an enterprise's financial and
operating policies, but not to control or jointly control the formulation of these policies with other parties. When
determining whether it can exert significant influence on the investee, consider the influence of the investor's
direct or indirect holding of the voting shares of the investee and the current executable potential voting rights
held by the investor and other parties after the assumed conversion into the equity of the investee, including the
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influence of convertible warrants, share options and convertible corporate bonds issued by the investee in the
current period
23. Investment real estate
Measurement for investment real estate
Cost method
Depreciation or amortization method
Refer to real estate held for rent or capital appreciation, or both, including leased land use rights, land use rights
held and ready to be transferred after appreciation, and leased buildings. Investment real estate should be initially
measured at cost, and cost model should be used for subsequent measurement of investment real estate or fair
value model on the balance sheet date.
(1) Measured by cost method
Depreciation or amortization is provided on a straight-line basis over the following service life and estimated
net residual value ratio:
Estimated net Annual depreciation or
Name Service life
residual value ratio (%) amortization rate (%)
Houses and
20-40 0-10 2.25-5.00
buildings
(2) Measured by fair value
No depreciation or amortization is made for investment real estate, and its book value is adjusted based on the fair
value of the investment real estate on the balance sheet date, and the difference between the fair value and the
original book value is included in the current profit and loss.
24. Fixed assets
(1) Recognition
Fixed assets are tangible assets that are held for production of goods, provision of labor service, rental or
operation management and have a useful life of more than one fiscal year. Fixed assets are recognized while the
following conditions are simultaneously meet:
①The economic interest related to the fixed assets probably flow into the Company;
②Cost of the fixed assets can be measured reliably.
(2) Depreciation
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Annual depreciation
Category Depreciation method Depreciation life Salvage rate
rate
Straight-line
House and building 20-40 years 0%-10% 2.25%-5.00%
depreciation
Straight-line
Vessel and netting gear 5-30 years 3%-5% 3.17%-19.40%
depreciation
Straight-line
Machine equipment 8-20 years 0%-10% 4.50%-12.50%
depreciation
Transportation Straight-line
5 years 0%-10% 18.00%-20.00%
equipment depreciation
Furniture and office Straight-line
5 years 0%-10% 18.00%-20.00%
equipment depreciation
(3) Determination basis, valuation and depreciation method of fixed assets under financing lease
Determination basis of fixed assets under financing lease
A lease is usually classified as a financial leasing if one or more of the following conditions exist:
① At the expiration of the lease term, the ownership of the leased asset is transferred to the lessee.
② The lessee has the option to purchase the leased asset, and the purchase price entered into is sufficiently low
compared with the expected fair value of the leased asset at the time the option is exercised, so it can be
reasonably determined that the lessee will exercise the option on the lease commencement date.
③ Although the ownership of the asset is not transferred, the lease term accounts for most of the useful life of the
leased asset.
④ On the lease commencement date, the present value of the lease receipts is almost equal to the fair value of the
leased assets.
⑤ The leased assets are of a special nature, if no major renovations are made, only the lessee can use them.
A lease may also be classified as a financial leasing if there is one or more of the following indications:
① If the lessee cancels the lease, the lessee shall bear the loss caused by the cancellation of the lease to the lessor.
② Gains or losses arising from fluctuations in the fair value of the residual value of assets are attributed to the
lessee.
③ The lessee has the ability to continue the lease to the next period at a rent far below the market level.
Valuation and depreciation method of fixed assets under financing lease:
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The leased assets are mainly office buildings and cold storage.
① Initial measurement
On the commencement date of the lease term, the right to use the leased asset during the lease term is recognized
as a right-of-use asset, and the present value of the unpaid lease payments is recognized as a lease liability (except
for short-term leases and leases of low-value assets). When calculating the present value of lease payments, the
interest rate implicit in the lease is used as the discount rate; if the interest rate implicit in the lease cannot be
determined, the incremental borrowing rate of the lessee is used as the discount rate.
② Subsequent measurement
With reference to the relevant depreciation provisions of Accounting Standards for Business Enterprises No. 4 -
Fixed Assets, provision for depreciation is made for right-of-use assets. If it can be reasonably determined that the
ownership of the leased asset will be acquired at the expiration of the lease term, provision for depreciation will be
made within the remaining useful life of the leased asset. If it cannot be reasonably determined that the ownership
of the leased asset can be acquired at the expiration of the lease term, provision for depreciation will be made
within the shorter of the lease term and the remaining useful life of the leased asset.
For lease liabilities, the interest expenses in each period of the lease term shall be calculated at a fixed periodic
interest rate, and shall be included in the current profit and loss or included in the related asset cost. Variable lease
payments not included in the measurement of lease liabilities shall be included in the current profit and loss or the
related asset cost when they are actually incurred.
③After the commencement date of the lease term, when there are changes in the actual fixed payment, changes in
the estimated payable amount of the guaranteed residual value, changes in the index or ratio used to determine the
lease payment, and changes in the evaluation results or the actual exercise of purchase option, renewal option or
termination option, the Group re-measures the lease liability based on the present value of the changed lease
payment, and adjusts the book value of the right-of-use asset accordingly. Where the book value of the right-of-
use asset has been reduced to zero, but the lease liability still needs to be further reduced, the remaining amount
shall be included in the current profit and loss.
25. Construction in progress
Construction in progress of the Company divided as self-run construction and out-bag construction. The
Construction in progress of the Company carried forward as fixed assets while the construction is ready for the
intended use. Criteria of the expected condition for use should apply one of the follow conditions: The substance
construction (installation included) of the fixed assets has completed all or basically; As the projects have been in
test production or operation, and the results show that the assets can operate properly and produce the qualified
products stably, or the test operation result shows the assets can operate or open properly. The expenditure of the
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fixed assets on the construction, is a little or little. The fixed assets of the project constructed have been up to the
requirements of the design or contract, or basically up to.
26. Borrowing costs
(1)As for the Company’s actual Borrowing costs directly attributable to the assets construction or production, it is
capitalized and reckoned into the relevant assets cost. The assets eligible for capitalization are assets as fixed
assets, investment real estate and inventories that require a significant period of time (usually one year or more)
for their acquisition or production activities to reach their scheduled availability and saleable status. Other
borrowing costs shall be recognized as expenses according to the amount incurred and included in the current
profit and loss. Borrowing costs include borrowing interest, amortization of discount or premium, auxiliary
expenses, and foreign exchange difference arising from foreign currency borrowings.
(2) Borrowing costs shall be capitalized if they meet the following conditions at the same time:
①The asset expenditure has occurred, and the asset expenditure includes the cash paid for acquisition and
construction or production of assets eligible for capitalization, and expenses incurred in the form of transferring
non-cash assets or assuming interest-bearing debt.
②The borrowing costs have already occurred;
③ Acquisition and construction or production activities necessary to make the asset ready for its intended use or
sale have started.
The capitalization of borrowing costs shall cease when acquisition and construction or production of assets
eligible for capitalization are ready for intended use or sale.
Where the assets eligible for capitalization are abnormally interrupted in the process of acquisition, construction
or production, and the interruption lasts for more than 3 months, the capitalization of borrowing costs shall be
suspended. The borrowing costs incurred during the interruption period shall be recognized as expenses and
included in the current profit and loss until the acquisition, construction or production of the asset resumes. If the
interruption is a necessary procedure for the acquired, constructed or produced assets eligible for capitalization to
be ready for their intended use or sale, the capitalization of borrowing costs will continue.
(3) During the capitalization period, the capitalized amount of interest (including the amortization of discount or
premium) in each accounting period shall be determined in accordance with the following provisions:
① If a special loan is borrowed for the acquisition, construction or production of assets eligible for capitalization,
the interest expenses actually incurred in the current period of the special loan shall be determined by the amount
after deducting the interest income obtained by depositing the unused loan funds in the bank or the income from
investment obtained from temporary investment.
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② If general borrowings are occupied for the acquisition, construction or production of assets eligible for
capitalization, the amount of interest to be capitalized on general borrowings shall be calculated and determined
by multiplying the weighted average of asset expenditures for which cumulative asset expenditures exceed
specific borrowings and the capitalization rate of the occupied general borrowings. The capitalization rate is
determined based on the weighted average interest rate of general borrowings.
If there is a discount or premium on the borrowings, the amount of the discount or premium amortized in each
accounting period shall be determined according to the effective interest method, and the interest amount of each
period shall be adjusted.
During the capitalization period, the capitalized amount of interest in each accounting period shall not exceed the
amount of interest actually incurred on the relevant borrowings in the current period.
(4) Auxiliary expenses incurred in special borrowings, which are incurred before the acquired, constructed or
produced assets eligible for capitalization reach the intended use or sale state, shall be capitalized according to the
amount incurred and included in the cost of the assets eligible for capitalization, if they are incurred after the
acquired, constructed or produced assets eligible for capitalization reach the intended use or sale state, they shall
be recognized as expenses according to the amount incurred and included in the current profit and loss. Auxiliary
expenses incurred in general borrowings are recognized as expenses according to the amount incurred when they
are incurred, and are included in the current profit and loss.
27. Right-of-use assets
Category of the right-of-use assets including houses and buildings.
(1)Recognition condition
The right-of-use asset refers to the right of the company as the lessee to use the leased asset during the lease term.
The company recognizes the right-of-use asset for the lease on the commencement date of the lease term. The
right-of-use asset is recognized when it is probable that economic benefits will flow in and the cost can be
measured reliably.
(2) Initial measurement of right-of-use assets
Right-of-use assets are initially measured at cost, which includes:
①The initial measurement amount of the lease liability.
②For the lease payment paid on or before the start date of the lease period, if there is a lease incentive, deduct the
relevant amount of the lease incentive already enjoyed.
③ Initial direct expenses incurred by the lessee.
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④ The lessee's estimated costs to dismantle and remove the leased asset, restore the site where the leased asset is
located, or restore the leased asset to the condition agreed upon in the lease terms.
(3) Subsequent measurement of right-of-use assets
① Use cost model for subsequent measurement of right-of-use assets
② Provision for depreciation of right-of-use asset is made. If it can be reasonably determined that the ownership
of the leased asset will be acquired at the expiration of the lease term, the company shall accrue depreciation over
the remaining useful life of the leased asset. If it cannot be reasonably determined that the ownership of the leased
asset can be acquired at the expiration of the lease term, the company shall accrue depreciation within the shorter
of the lease term and the remaining useful life of the leased asset. The specific depreciation methods for each type
of right-of-use asset are as follows.
(4) Depreciation methods for various right-of-use assets
Various fixed assets adopt the straight-line method for accrual of depreciation according to the following service
life, estimated net residual value rate and depreciation rate:
Estimated net salvage Annual depreciation rate
Category Depreciation method Service life
value rate (%) (%)
Houses and buildings Straight-line method 1.5-3 years 0 33.33-66.67
(5) Change of lease
When the lease liability is re-measured at the present value of the changed lease payment and the book value of
the right-of-use asset is adjusted accordingly, if the book value of the right-of-use asset has been reduced to zero,
but the lease liability still needs to be further reduced, the remaining amount shall be included in the current profit
and loss.
(6) Methods for impairment test and provision for impairment of right-of-use assets
On the balance sheet date, if there is evidence that the right-of-use asset is impaired, the corresponding
impairment provision shall be made according to the difference between the book value and the recoverable
amount.
28. Intangible assets
(1) Valuation methods, service life and impairment testing
Intangible assets refer to identifiable non-monetary assets without physical form owned or controlled by an
enterprise. Intangible assets are initially measured at cost. When acquiring intangible assets, analyze and judge
their useful life.
Factors that the company usually considers when determining the useful life of intangible assets:
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① The usual life cycle of the product produced using the asset, and available information on the useful life of
similar assets;
②The current situation of technology, process and other aspects and the estimation of future development trend;
③ The market demand for products produced or services provided by the asset;
④ Actions expected to be taken by current or potential competitors;
⑤ The expected maintenance expenses for maintaining the ability of the asset to bring economic benefits, and the
company's expected ability to pay the relevant expenses;
⑥ Relevant legal provisions or similar restrictions on the control period of the asset, such as license period, lease
term, etc.;
⑦Relationship with the service life of other assets held by the enterprise, etc.
If it is impossible to foresee the period in which an intangible asset brings economic benefits to the company, it
shall be regarded as an intangible asset with an indefinite useful life.
For an intangible asset with limited useful life, systematically and reasonably (or straight-line method) amortize in
the useful life. At the end of each year, the company reviews the useful life and amortization method of intangible
assets with limited useful life. If the useful life and amortization method of intangible assets are different from
previous estimates, the amortization period and amortization method will be changed.
For intangible assets with limited useful life, when calculating the amortization amount using the straight-line
method, the useful lives and estimated net residual value ratios of various intangible assets are as follows:
Name Service life Estimated net salvage value rate (%)
Land use rights 42-50 years 0
Software 5-10 years 0
(2) Accounting policy of the internal R&D expenditure
① Expenditures for internal research and development projects, including research phase expenditure and
development phase expenditure,of which:
1) Research means original and planned investigations to acquire and understand new scientific or technological
knowledge.
2) Development refers to the application of research results or other knowledge to a plan or design before
commercial production or use, so as to produce new or substantially improved materials, devices, products, etc. .
② Expenditures on internal research and development projects in the research stage are included in the current
profit and loss when incurred; expenditures in the development stage are recognized as intangible assets when
meet the following conditions at the same time:
1)Completing the intangible asset so that it can be used or sold and has technical feasibility;
2)With the intention to complete the intangible asset and use or sell it;
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3)The method of intangible asset generating economic benefits, including the ability to prove that the product
produced by the intangible asset exists in the market or the intangible asset itself exists in the market, if the
intangible asset will be used internally, its usefulness can be proved;
4)Sufficient technical, financial resources and other resource support are available to complete the development of
the intangible asset and have the ability to use or sell the intangible asset;
5)The expenditures vested in the development stage of this intangible asset can be reliably measured.
29. Long-term assets impairment
For non-current non-financial assets such as fixed assets, construction in progress, intangible assets with limited
useful lives, investment real estate measured at cost, and long-term equity investments in subsidiaries, joint
ventures, and associates, the company determine whether there is any sign of impairment on the balance sheet
date. Where there are signs of impairment, estimate the recoverable amount and conduct an impairment test. For
intangible assets with indefinite goodwill and useful lives and intangible assets that have not yet reached a usable
state are subject to an annual impairment test regardless of whether there is any sign of impairment.
Where the result of the impairment test indicates that the recoverable amount of the asset is lower than its book
value, provision for impairment shall be made according to the difference and included in the impairment loss.
The recoverable amount is the higher of net amount of asset’s the fair value less disposal costs and the present
value of the asset's expected future cash flows. The fair value of the asset is determined based on the price of the
sales agreement in the fair transaction; where there is no sales agreement but there is an active market for the asset,
the fair value is determined based on the buying offer for the asset; where there is neither sales agreement nor
active market, the fair value of the asset is estimated based on the best information available. Disposal costs
include legal fees, related taxes, and removal fees related to the assets disposal, as well as direct expenses incurred
in bringing the assets to marketable condition. The present value of the expected future cash flow of the asset is
determined according to the expected future cash flow generated during the continuous use and final disposal of
the asset, and the discounted amount is determined by selecting an appropriate discount rate. The 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 shall be determined based on
the asset group to which the asset belongs. An asset group is the smallest asset portfolio that can independently
generate cash inflows.
As far as the impairment test of goodwill is concerned, the book value of the goodwill formed by a business
combination shall be apportioned to the relevant asset group in a reasonable manner from the date of acquisition;
where it is difficult to apportion it to the relevant asset group, it shall be apportioned to the related asset group
portfolio. The relevant asset group or asset group portfolio is an asset group or asset group portfolio that can
benefit from the synergistic effect of the business combination, and is not larger than the reporting segment
determined by the Company.
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When conducting an impairment test on the relevant asset group or asset group portfolio that contains goodwill, if
there is any sign of impairment of the asset group or asset group portfolio related to goodwill, first make
impairment test on the asset group or asset group portfolio without goodwill, calculate the recoverable amount,
and recognize the corresponding impairment loss. Then carry out an impairment test on the asset group or asset
group portfolio with goodwill, and compare its book value with the recoverable amount. Where the recoverable
amount is lower than the book value, the amount of impairment loss shall first deduct the book value of goodwill
apportioned to the asset group or asset group portfolio, and then proportionally deduct the book value of other
assets according to the proportion of the book value of other assets other than goodwill in the asset group or asset
group portfolio, but the book value of each asset after offsetting shall not be lower than the higher of the net
amount (if determinable) of the asset's fair value less disposal costs and the present value of the asset's expected
future cash flow (if determinable), and at the same time not less than zero.
Once the impairment loss of such assets is recognized, it is not be reversed in any subsequent period.
30. Long-term deferred expenditure
Long-term deferred expenditure is an expenses that has been incurred but should be borne by the Company in
current and future period and is apportioned over a period of one year or more (exclusive). the long-term
deferred expenditure is amortized evenly over the benefit period, if the long-term deferred expenditure does not
benefit subsequent accounting periods, the entire unamortized value amortized should be transferred to current
gain/losses.
Amortized on a straight-line basis over the following years:
Name Amortization period
Decoration costs 2-10 years
31. Contract liability
Contract liability reflects the obligation to transfer goods to a customer for consideration received or receivable
from the customer. Before transferring the goods to the customer, where the customer has already paid the
contract consideration or has acquired the right to unconditionally receive the contract consideration, the contract
liability shall be recognized according to the amount received or receivable at the earlier point of time of the
actual payment amount and the amount due and payable. Contract assets and contract liabilities under the same
contract are listed as net amount, and contract assets and contract liabilities under different contracts are not offset.
32. Employees benefits
(1) Accounting for short-term remuneration
Short-term remuneration refers to the employee remuneration that the company needs to pay in full within 12
months after the end of the annual reporting period in which the employees provide relevant services.
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Short-term remuneration includes employee wages, bonuses, allowances and subsidies, employee welfare,
medical insurance, work-related injury insurance and maternity insurance and other social insurance premiums,
housing provident fund, labor union funds and employee education funds, short-term paid absences, short-term
profit sharing plans, non-monetary benefits, and other short-term compensation.
Short-term remuneration is during the accounting period in which employees provide services to the company, the
actual short-term remuneration is recognized as a liability and included in the current profit and loss or related
asset costs.
(2) Accounting for post-employment benefits
Post-employment benefits refer to various forms of remuneration and benefits provided by the company in order
to obtain the services provided by the employees after the employees retire or terminate the labor relationship with
the company, except for short-term remuneration and dismissal benefits.
Post-employment benefit plans shall be classified as defined contribution plans and defined benefit plans. Among
them, a defined contribution plan refers to a post-employment benefit plan in which the company no longer
undertakes further payment obligations after paying a fixed fee to an independent fund; a defined benefit plan
refers to a post-employment benefit plan other than the defined contribution plan.
The defined contribution plan includes basic pension insurance, unemployment insurance, etc. During the
accounting period in which the employee provides services, the amount to be paid calculated according to the
defined contribution plan is recognized as a liability and included in the current profit and loss or related asset
costs.
At the end of the reporting period, the employee remuneration costs arising from the defined benefit plan are
recognized as the following components:
①Service costs, including current service costs, past service costs and settlement gains or losses.
②The net interest of net liabilities or net assets of the defined benefit plan, including the interest income of the
plan assets, the interest expenses of the obligations of the defined benefit plan, and the interest affected by the
asset limit.
③ Changes arising from re-measurement of net liabilities or net assets of other long-term employee benefits.
Unless other accounting standards require or allow the cost of employee benefits to be included in the cost of
assets, the above items ① and ② shall be included in the current profit and loss; item ③ shall be included in other
comprehensive income, and it is not allowed to be transferred back to profit or loss in subsequent accounting
periods, but the amounts recognized in other comprehensive income may be transferred within equity.
Under a defined benefit plan, past service costs are recognized as current expenses on the earlier of the following
dates:
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1) When revising the defined benefit plan.
2) When the enterprise confirms relevant restructuring expenses or dismissal benefits.
When a defined benefit plan is settled, a settlement gain or loss is recognized.
(3) Accounting for termination benefits
The termination benefits are compensation given by the Company to an employee to terminate the employment
relationship before the expiration of the employment contract, or to encourage the employee to voluntarily
accept redundancy.
The Company recognizes a liability and expenses in the current profit or loss for termination benefits at the
earlier of the following dates: when the Company can no longer withdraw the offer of those benefits; and when
the Company recognizes costs for restructuring involving the payment of termination costs.
(4) Accounting for other long-term employee benefits.
Other long-term employee benefits refer to all employee remuneration except short-term remuneration, post-
employment benefits, and dismissal benefits, including long-term paid absences, long-term disability benefits, and
long-term profit-sharing plans.
Other long-term employee benefits provided by the enterprise to employees that meet the conditions of the
defined contribution plans shall be dealt with in accordance with the relevant provisions of the above defined
contribution plans.
Except for the situations that meet the conditions of the defined contribution plans, the net liabilities or net assets
of other long-term employee benefits shall be recognized and measured in accordance with the relevant provisions
of the defined benefit plans. At the end of the reporting period, the enterprise shall recognize the cost of employee
remuneration arising from other long-term employee benefits as the following components:
① Service costs.
② Net interest on net liabilities or net assets of other long-term employee benefits.
③ Changes arising from re-measurement of net liabilities or net assets of other long-term employee benefits.
In order to simplify the relevant accounting treatment, the total net amount of the above items is included in the
current profit and loss or the related asset costs.
33. Leasing liability
On the commencement date of the lease term, except for short-term leases and leases of low-value assets, the
present value of unpaid lease payments is recognized as a lease liability. When calculating the present value of
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lease payments, the interest rate implicit in the lease is used as the discount rate; where the interest rate implicit in
the lease cannot be determined, the incremental borrowing rate of the lessee is used as the discount rate. The
interest expenses of the lease liability in each period of the lease term are calculated at a fixed periodic interest
rate and included in the current profit and loss, except for those included in the asset costs. Variable lease
payments that are not included in the measurement of lease liabilities are included in the current profit and loss
when they are actually incurred, unless otherwise stipulated to be included in the related asset costs.
After the commencement date of the lease term, when there are changes in the actual fixed payment amount,
changes in the estimated payable amount of the guaranteed residual value, changes in the index or ratio used to
determine the lease payments, as well as changes in the assessment results of a purchase option, a lease renewal
option or a termination option or changes in the actual exercise situation, the lease liability is remeasured at the
present value of the changed lease payments.
34. Accrual liability
the contingent obligation is recognized as an accrual liability if both of the following conditions are met:
(1) the obligation is a present obligation of the enterprise;
(2) performance of the obligation is likely to result in an outflow of economic benefits from the enterprise;
(3) amount of the obligation can be measured reliably.
The accrual liability should be initially measured at the best estimate of the expenditure required to settle the
related present obligations.
35.Share-based payment
(1) Types of share-based payment
Share-based payment is classified as equity-settled share-based payment and cash-settled share-based payment.
Equity-settled share-based payment refers to a transaction in which an enterprise uses shares or other equity
instruments as consideration to acquire services. The equity instruments referred here are the enterprise's own
equity instruments.
Cash-settled share-based payment refers to a transaction in which an enterprise undertakes the obligation to
deliver cash or other assets calculated and determined on the basis of shares or other equity instruments in order to
acquire services.
(2) Methods of determining the fair value of equity instruments.
Where there is an active market for equity instruments, it shall be determined according to the quotation in the
active market.
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Where there is no active market for equity instruments, use valuation techniques for determination, including
reference to prices used in recent market transactions among parties who are familiar with the situation and
willing to trade, reference to the current fair value of other financial instruments that are substantially the same,
discounted cash flow method and option pricing model.
(3) Basis for confirming the best estimate of the exercisable equity instruments.
On each balance sheet date, according to the latest follow-up information such as the change in the number of
exercisable people and the completion of performance indicators, the number of stock options that are expected to
be exercisable is revised, and the expenses to be apportioned in each period are confirmed on this basis. For an
option cost spanning multiple accounting periods, it can generally be apportioned according to the proportion of
the waiting period length of the option to the entire waiting period length in a certain accounting period.
(4) Accounting treatment related to implementation, modification and termination of share-based payment plan
① The equity-settled share-based payment that is exercisable immediately after the grant in exchange for
employee services shall be included in the relevant costs or expenses according to the fair value of the equity
instrument on the grant date, and the capital reserve shall be increased accordingly.
Equity-settled share-based payment that can be exercised in exchange for employee services after the completion
of the service during the waiting period or satisfying the specified performance conditions, on each balance sheet
date during the waiting period, based on the best estimate of the number of exercisable equity instruments, the
services obtained in the current period are included in the relevant costs or expenses and capital reserves
according to the fair value of the equity instruments on the grant date,.
On the balance sheet date, where the subsequent information indicates that the number of exercisable equity
instruments is different from the previous estimate, adjustments shall be made and adjusted to the actual number
of exercisable equity instruments on the exercise date.
For equity-settled share-based payment, no adjustment will be made to the confirmed cost and total owner's equity
after the vesting date. On the exercise date, the share capital and share premium will be confirmed according to
the exercise situation, and the capital reserves (other capital reserves) confirmed during the waiting period will be
carried forward.
For the granted equity instruments such as options in an active market, the fair value shall be determined
according to the quotation in the active market. For granted equity instruments such as options not in an active
market, the option pricing model should be used to determine their fair value, and the option pricing model
selected should at least consider the following factors:
1) the exercise price of the option;
2) the validity period of the option;
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3) the current price of the underlying shares;
4) the expected volatility of the stock price;
5) estimated dividends on the shares;
6) the risk-free interest rate during the validity period of the option.
② The cash-settled share-based payment that can be exercised immediately after the grant shall be included in the
relevant cost or expenses at the fair value of the liabilities assumed by the enterprise on the grant date, and the
liabilities shall be increased accordingly.
For the cash-settled share-based payment that can only be exercised after completing the service during the
waiting period or meeting the specified performance conditions, on each balance sheet date during the waiting
period, based on the best estimate of the exercise situation, the services acquired in the current period are included
in the cost or expenses and the corresponding liability according to the fair value of the liabilities assumed by the
enterprise.
On each balance sheet date and settlement date before the settlement of the relevant liabilities, the fair value of the
liabilities is re-measured, and the changes are included in the current profit and loss.
36. Revenue
Accounting policies for recognition and measurement of revenue
(1) Principles of revenue recognition
When the contract with the customer meets the following conditions at the same time, the revenue is recognized
when the customer obtains the control of the relevant commodity:
① The parties to the contract have approved the contract and promised to perform their respective obligations;
②The contract has specified the rights and obligations of the parties to the contract in relation to the transferred
commodity or the provision of labor services;
③ The contract has clear payment terms related to the transferred commodity;
④ The contract has commercial substance, that is, the performance of the contract will change the risk, time
distribution or amount of future cash flows of the Group;
⑤ The consideration entitled to the transfer of commodity to the customer is likely to be recovered.
Evaluate the contract on the contract start date, identify each individual performance obligation contained in the
contract, and allocate the transaction price to each individual performance obligation according to the relative
proportion of the stand-alone selling price of the commodities promised by each individual performance
obligation. In determining the transaction price, the influence of factors such as variable consideration, significant
financing components in the contract, non-cash consideration, and consideration payable to customers are
considered. Then determine whether each individual performance obligation is performed within a certain period
56
of time or at a certain point in time, and recognize revenue separately when each individual performance
obligation is performed.
If one of the following conditions is met, the performance obligation is fulfilled within a certain period of time;
otherwise, the performance obligation is fulfilled at a certain point in time:
1) The customer obtains and consumes the economic benefits brought by the performance when the enterprise
fulfills the contract;
2) The customer can control the commodities under construction in the process of contract performance;
3) The commodities produced by the enterprise during the contract performance have irreplaceable uses, and the
enterprise has the right to receive payment for the performance part that has been completed so far during the
entire contract period.
For performance obligations performed within a certain period of time, revenue is recognized according to the
progress of performance within that period. The progress of contract performance is determined by the input
method or output method according to the nature of the transferred commodities. When the progress of contract
performance cannot be reasonably determined, and the costs incurred are expected to be compensated, revenue
shall be recognized according to the amount of cost incurred until the progress of contract performance can be
reasonably determined.
If one of the above conditions is not met, revenue will be recognized at the transaction price allocated to the single
performance obligation when the customer acquired control over the relevant commodity. The following signs
should be considered when judging whether a customer has acquired control of a commodity:
(1) The enterprise has the current right to receive payment for the commodity, that is, the customer has the current
payment obligation for the commodity;
(2)The enterprise has transferred the legal ownership of the commodity to the customer, that is, the customer
already owns the legal ownership of the commodity;
(3)The enterprise has transferred the commodity in kind to the customer, that is, the customer has physically
possessed the commodity;
(4)The enterprise has transferred the main risks and rewards of the ownership of the commodity to the customer,
that is, the customer has obtained the main risks and rewards of the ownership of the commodity;
(5)The customer has accepted the commodity;
(6) Other signs that the customer has acquired control over the commodity.
(2)Recognition of the revenue in the Company
①Revenue recognized by the Company at a point in time when the Company has control of the related assets:
For the Company's purse seine fish sold at overseas bases, generally, the revenue is recognized upon delivery of
fishing goods to customers and obtaining the right to receive payment; in the case of export sales by the local
country, the income is recognized when the shipping order and bill of lading are obtained.
57
Most of the Company's longline fishing goods are shipped back to domestic sales, and based on the sales contract
and value statements signed by both parties, the change in the right of goods is recognize on the date of the value
statement, and recognized the sales revenue.
Domestic sales of the Company's aquatic products processing: Shandong Zhonglu Oceanic (Yantai) Foods Co.,
Ltd. issues a delivery confirmation according to the fax or mail order from domestic customers, and the Company
ships the goods according to the delivery order issued by the sale department and signed by the warehouse
management department, recognized the sales revenue after the customer signs for it.
Foreign sales of the Company's aquatic products processing: After the international trade department obtains the
purchase orders of foreign customers, it issues an export delivery confirmation form and arranges the storage and
transportation department to stock up. The Company recognized the sales revenue based on shipping documents
and export documents such as packing slips and customs declarations.
②Revenue recognized by the Company in the performance period:
The Company's refrigerating fee income: After the warehousing department obtains the customer's orders, it shall
issue the warehouse-in receipt to the customer to confirm the specific name, specifications, number of pieces,
weight and warehouse-in date of the goods, both the warehouse supervisor and the customer sign to confirm, and
the revenue is recognized monthly based on the actual storage days of the goods.
37. Government subsidy
The government subsidy is the monetary and non-monetary asset acquired by the Company from the
government without compensation. They classified as asset-related government subsidy and income/revenue-
related government subsidy.
(1) Judgment basis and accounting treatment method of government subsidy related to assets
government subsidy related to assets refer to government subsidy acquired by enterprises and used for acquisition
and construction or to form long-term assets in other ways.
Government subsidy related to assets are recognized as deferred income by the Company, and are included in the
profit and loss in stages according to a reasonable and systematic method within the useful life of the relevant
assets. government subsidy measured at the nominal amount are directly included in the current profit and loss.
Where relevant assets are sold, transferred, scrapped or damaged before the end of their useful life, the
undistributed balance of relevant deferred income shall be transferred to the current profit and loss of asset
disposal.
58
Government subsidy related to the company's daily activities are included in other income by the Company
according to the economic business. government subsidy unrelated to the company's daily activities shall be
included in non-operating revenue.
(2) Judgment basis and accounting treatment method of government subsidy related to income
government subsidy related to income refer to government subsidy other than government subsidy related to
assets.
With regard to government subsidy for comprehensive projects, the Company needs to decompose them into
asset-related parts and income-related parts for separate accounting treatment; if it is difficult to distinguish, they
shall be classified as income-related government subsidy as a whole.
Government subsidy related to income, which are used to compensate the relevant expenses or losses of the
enterprise in the future period, are recognized as deferred income when acquired, and are included in the current
profit and loss during the period in which the relevant cost or loss is recognized; those used to compensate the
related expenses or losses incurred by the enterprise shall be directly included in the current profit and loss.
government subsidy related to the company's daily activities shall be included in other income according to the
economic business. Government subsidies unrelated to the company's daily activities shall be included in non-
operating revenue.
If the Company obtains policy preferential loan interest discount, it shall distinguish two situations in which the
finance allocates the discounted interest funds to the lending bank and the finance allocates the discounted interest
funds directly to the enterprise:
Where the finance allocates the discounted interest funds to the lending bank, and the lending bank provides loans
to the enterprise at the policy-based preferential interest rate, the Company shall take the actual amount of the loan
received as the entry value of the loan, and calculate the relevant borrowing costs based on the loan principal and
the policy-based preferential interest rate.
Where the finance allocates the discounted interest funds to the enterprise, the Company shall offset the relevant
borrowing costs with the corresponding discounted interest.
(3) Time-point for confirming the government subsidy
Where the government grant is a monetary asset, the Company will recognize it when it is actually received and
meets the conditions attached to the government subsidy; Where the government grant is a non-monetary asset,
the Company will recognize it when obtaining the control right of the non-monetary asset. Among them, non-
monetary asset is measured at fair value; if the fair value cannot be acquired reliably, it is measured at the nominal
amount.
59
When the confirmed government grant needs to be returned, if there is a balance of relevant deferred income, the
book balance of the relevant deferred income shall be offset, and the excess shall be included in the current profit
and loss; if there is no relevant deferred income, it shall be directly included in the current profit and loss.
38. Deferred income tax asset and deferred income tax liability
Income tax is accounted for using the balance sheet liability method. On the balance sheet date, analyze and
compare the book value of assets and liabilities and their tax bases. Where there is a difference between the two,
recognize deferred income tax assets, deferred income tax liabilities and corresponding deferred income tax
expenses (or gains). On the basis of calculating and determining the current income tax (that is, the income tax
payable in the current period) and the deferred income tax expenses (or gains), the sum of the two is recognized as
the income tax expenses (or gains) in the income statement, but does not include a transaction directly included in
the ownership interest or the income tax effect of an event.
At the balance sheet date, review the book value of deferred tax assets. If it is probable that sufficient taxable
income cannot be obtained in the future to offset the benefits of deferred tax assets, the book value of deferred tax
assets should be written down.
39. Leasing
(1) Accounting of operating leases
Not applicable
(2) Accounting of finance lease
A lease is a contract that transfers or acquires the right to control the use of one or more identified assets for a
specified period in exchange for or payment of consideration. At the commencement date of a contract, assess
whether the contract is or contains a lease.
1) The company as the lessee
The leased assets are mainly office buildings and cold storage.
①Initial measurement
At the commencement date of the lease term, the right to use the leased asset during the lease term is recognized
as a right-of-use asset, and the present value of the unpaid lease payments is recognized as a lease liability (except
for short-term leases and leases of low-value assets). When calculating the present value of lease payments, the
60
interest rate implicit in the lease is used as the discount rate; if the interest rate implicit in the lease cannot be
determined, the incremental borrowing rate of the lessee is used as the discount rate.
② Subsequent measurement
With reference to the relevant depreciation provisions of Accounting Standards for Business Enterprises No. 4 -
Fixed Assets to conduct depreciation on the right-of-use assets (see Note IV. 27 Right-of-use assets), where it can
be reasonably determined that the ownership of the leased assets will be obtained at the expiration of the lease
term, depreciation shall be accrued within the remaining useful life of the leased asset. Where it cannot be
reasonably determined that the ownership of the leased asset can be obtained at the expiration of the lease term,
depreciation shall be accrued within the shorter of the lease term and the remaining useful life of the leased asset.
For lease liabilities, the interest expenses in each period of the lease term is calculated at a fixed periodic interest
rate, and is included in the current profit and loss or included in the related asset cost. Variable lease payments not
included in the measurement of lease liabilities are included in the current profit and loss or the related asset cost
when they are actually incurred.
③After the commencement date of the lease term, when there are changes in the actual fixed payment, changes in
the estimated payable amount of the guaranteed residual value, changes in the index or ratio used to determine the
lease payment, and changes in the evaluation results or the actual exercise of purchase option, renewal option or
termination option, the Group re-measures the lease liability based on the present value of the changed lease
payment, and adjusts the book value of the right-of-use asset accordingly. Where the book value of the right-of-
use asset has been reduced to zero, but the lease liability still needs to be further reduced, the remaining amount
shall be included in the current profit and loss.
④ Short-term leases and low-value asset leases
For short-term leases (leases with a lease term of not more than 12 months on the lease commencement date) and
low-value asset leases, a simplified approach is adopted, no right-of-use assets and lease liabilities are recognized,
and lease payments are included in the relevant asset cost or in the current profit and loss by the straight-line
method or other systematic and reasonable methods during each period of the lease term.
2) The company as the lessor
At the commencement date, leases are classified into financial leases and operating leases based on the transaction.
A financial lease is a lease that substantially transfers all the risks and rewards associated with ownership of the
leased asset. Operating leases refer to leases other than financial leases.
①Operating lease
The Company adopts the straight-line method to recognize lease receipts from operating leases as rental income
for each period of the lease term. Variable lease payments related to operating leases that are not included in lease
receipts are included in the current profit or loss when they are actually incurred.
② Financial lease
61
At the commencement date of the lease term, the financial lease receivables are recognized and the financial
leasing assets are derecognized. The financial lease receivables are initially measured as the net lease investment
(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 implicit in the lease), and the interest income
is calculated and recognized at a fixed periodic interest rate calculation during the lease term. The variable lease
payments not included in the measurement of net lease investment are included in the current profit and loss
when they are actually incurred.
③ The Company's income to which the lease standards apply
The Company's income from ship leasing: Shandong Zhonglu Aquatic Shipping Co., Ltd. and HABITAT
INTERNATIONAL CORPORATION adopt time charter for the leasing of transport ships. The company leases
the ships equipped with operating personnel to others for a certain period of time, and waits for the lessee to
dispatch during the lease term, the lease fee is charged to the lessee on a daily basis regardless of whether the ship
is operating or not, and the company is responsible for the fixed costs (such as personnel wages, maintenance
costs, etc.). Periodic settlement is made with the customer during the lease term, and the income is recognized
according to the number of lease days determined together with the customer.
The Company's housing and other rental income: after signing a lease contract with the customer, the company
will collect the rental fee from the lessee based on the leased area and the contract unit price, and the fixed costs
(such as staff wages, maintenance costs, etc.) are all borne by the company. Periodic settlement is made with the
customer during the lease term, and the income is recognized according to the customer’s lease period.
40. Changes of other important accounting policy and estimation
(1) Changes in important accounting policies
√Applicable □Not applicable
Contents and reasons of changes in
Approval procedures Note
accounting policies
On December 30, 2021, the Ministry of
Finance issued the Interpretation No. 15
of the Accounting Standards for Business
Enterprises (Cai Kuai [2021] No. 35),
which regulates the accounting treatment Found more in relevant Notice released
for the external sales of products or by- Released by announcement on Juchao Website
products produced by enterprises before (http://www.cninfo.com.cn)
the fixed assets are ready for their
intended use or during the research and
development process, the presentation of
centralized management of funds, and
62
the judgment on loss-making contracts.
The company made changes to the
corresponding accounting policies in
accordance with the above-mentioned
notice of the Ministry of Finance.
In the Interpretation No. 15 of the Accounting Standards for Business Enterprises Interpretation No. 15, the
contents of the "accounting treatment for the external sales of products or by-products produced by enterprises
before the fixed assets are ready for their intended use or during the research and development process" and
"judgment on loss-making contracts" have come into force on January 1, 2022; the contents of " presentation of
centralized management of funds" have come into force on the date of promulgation. The company has made
changes to the corresponding accounting policies in accordance with the regulations mentioned above.
The changes in accounting policies are corresponding changes made by the company according to the latest
interpretation of accounting standards amended by the Ministry of Finance, which does not involve retrospective
adjustments to the previous years of the company, and will not have any significant impact on the company's
financial conditions and operating results, such as owner's equity, net profit, etc..
(2)Change of important accounting estimates
□Applicable √Not applicable
VI. Taxes
1. Major tax and tax rate
Taxes Taxation basis Tax rate
VAT Output tax minor the deductible input tax 13%, 9%, 6%, 5%, tax-free
Urban maintenance and construction tax Turnover taxes payable 7%
Corporate income ax Taxable amount Exemption, 25%, 8%
Explain the different taxation entity of the enterprise income tax
Taxation entity Income tax rate
Imposing no tax on distant fishing, and 25% for the houses
Shandong Zhonglu Oceanic Fisheries Company Limited
leasing
Shandong Zhonglu Haiyan Deep-sea Fishery Co., Ltd Exemption
AFRICA Based on regulation of Ghana: 8% for export parts, 25% for
STAR FISHERIES LIMITED domestic sales
HABITAT
INTERNATIONAL Exemption
CORPORATION
63
LAIF
25%
FISHERIES CO.LTD
ZHONG
25%
GHA FOODS COMPANY LIMITED
Shandong Zhonglu Fishery Shipping Co., Ltd. 25%
Imposing no tax on aquatic product processing, and 25% for
Shandong Zhonglu Ocean Refrigerated Co., Ltd
refrigeration service
Imposing no tax on aquatic product processing, and 25% for
Shandong Zhonglu Oceanic (Yantai) Foods Co., Ltd.
refrigeration service
Zhonglu Oceanic (Qingdao) Industrial Investment
25%
Development Co., Ltd
2. Preferential tax
(1) VAT tax preference:
According to the relevant provisions of the Circular About the Provisional Management Method of Not Levying
the Tax on the Aquatic Products Directly Caught by Ocean Fishery Enterprises (SS No. [2000] 260), China's
ocean fishery enterprises stipulate on the high seas or in accordance with the relevant agreements that the aquatic
products caught in foreign sea areas and sent back for domestic sales should be regarded as the domestic products
and should not be levied the import duties and import VAT. If the corresponding domestic sales business is the
primary agricultural products sales, exempt from the VAT according to the provisions of VAT rules. The
Company's sales revenue from ocean-going fishing operations is exempt from VAT.
According to the stipulations of the Notice on Comprehensively Implementing the Pilot Program of Replacing
Business Tax with Value-Added Tax" (No. 36 of 2016), the direct or indirect international freight forwarding
services provided by taxpayers are exempt from value-added tax. The relevant sales income obtained by
Shandong Zhonglu Fishery Shipping Co., Ltd., a subsidiary of the Company, is exempt from value-added tax.
(2) Income tax preference:
In accordance with relevant regulation of the Law of the People’s Republic of China on Enterprise Income Tax,
Implementation Regulations of the Corporate Income Tax Law of the People’s Republic of China, Ministry of
Finance, Sate Taxation Administration on Notice on the Release of Scope of Enterprise Income Tax Preferential
Policies to Enjoy the Primary Processing of Agricultural Products (Trial)(Cai Shui [2008]No.149, Ministry of
Finance, Sate Taxation Administration on Supplementary Notice on Scope of Enterprise Income Tax Incentive for
Primary Processing of Agricultural Products (Cai Shui [2011]No.26) and State Taxation Administration on Notice
on Issues Concerning the Implementation of Enterprise Income Tax Preferences for Agricultural, Forestry,
Husbandry and Fishery Projects (Announcement No.48 [2011] of the State Taxation Administration ), as for the
processing charge acquired from primary processing of agricultural products or the entrusted primary processing
business can be treated as a duty-free items. The income obtained from offshore fishing business and primary
64
processing of agricultural products are exempt from enterprise income tax. The income obtained except from
offshore fishing business and primary processing of agricultural products are tax at a rate of 25% for enterprise
income tax.
VII. Notes to main items in consolidated financial statement
1. Monetary fund
Unit: RMB/CNY
Item Closing balance Opening balance
Cash on hand 2,499,175.46 1,975,275.82
Bank deposit 210,436,955.65 207,674,030.17
Other monetary fund 924,476.50
Total 212,936,131.11 210,573,782.49
Including: Total amount save aboard 15,093,239.91 56,468,228.09
The total amount of money
that has restrictions on use due to 924,476.50
mortgage, pledge or freezing
2. Account receivable
(1) Category
Unit: RMB/CNY
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Including:
Account receivable
with bad debt 48,765,1 8,483,76 40,281,39 46,647,61 8,841,029 37,806,586.
100.00% 18.95%
provision accrual by 66.84 9.94 6.90 6.30 .39 91
portfolio
Including:
48,765,1 8,483,76 40,281,39 46,647,61 8,841,029 37,806,586.
Total 100.00% 18.95%
66.84 9.94 6.90 6.30 .39 91
Accrual of bad debt provision on portfolio: 8,483,769.94
Unit: RMB/CNY
Closing balance
Name
Book balance Bad debt provision Accrual ratio
Provision for bad debts by
48,765,166.84 8,483,769.94 17.40%
combination
Total 48,765,166.84 8,483,769.94
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected
credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-
debt provisions:
□Applicable √Not applicable
By account age
Unit: RMB/CNY
Account age Closing balance
Within one year (one year included) 41,716,632.63
65
1-2 years 920,010.37
2-3 years 6,993.87
Over three years 6,121,529.97
3-4 years 524,742.53
Over five years 5,596,787.44
Total 48,765,166.84
(2) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening Closing
Category Collected or
balance Accrual Charge-off Other balance
reversal
Provision for
bad debts by 8,841,029.39 401,377.91 759,905.99 -1,268.63 8,483,769.94
combination
Total 8,841,029.39 401,377.91 759,905.99 -1,268.63 8,483,769.94
(3) Top five account receivables collected by arrears party at ending balance
Unit: RMB/CNY
Ending balance of accounts Proportion in total receivables Bad debt preparation ending
Enterprise
receivable at ending balance balance
WEC CO.,LTD 8,139,905.08 16.69% 406,995.25
NOTOS CO.,LTD 5,788,702.20 11.87% 289,435.11
PANDA CO.,LTD 3,600,962.12 7.38% 3,600,962.12
Shenzhen SZY Trading
3,371,310.04 6.91% 168,565.50
Co., Ltd.
FCF CO.,LTD 2,294,638.15 4.71% 114,731.91
Total 23,195,517.59 47.56%
3. Accounts paid in advance
(1) By account age
Unit: RMB/CNY
Closing balance Opening balance
Account age
Amount Ratio Amount Ratio
Within one year 41,451,953.67 99.73% 18,422,346.91 98.62%
1-2 years 35,000.00 0.08% 31,878.50 0.17%
2-3 years 76,508.40 0.18% 229,525.20 1.21%
Total 41,563,462.07 18,683,750.61
(2) Top 5 account paid in advance collected by objects at ending balance
Name Closing balance Ratio in total account paid in
advance at period-end
Dongyi Sea Transportation 8,558,615.78 20.59%
Personal Company
Qingdao Jiyang Trading Co., Ltd. 4,536,309.07 10.91%
Somali fishing fees 4,443,603.99 10.69%
66
ECONOMIC AND ORGANISED 3,150,242.54 7.58%
CRIME OFFICE
Rongcheng Ocean Fishery Co., 3,118,961.03 7.50%
Ltd.
Total 23,807,732.41 57.28%
4. Other account receivable
Unit: RMB/CNY
Item Closing balance Opening balance
Other account receivable 1,749,343.28 3,596,759.88
Total 1,749,343.28 3,596,759.88
(1) Other account receivable
1) By nature
Unit: RMB/CNY
Nature Closing book balance Opening book balance
Margin 312,971.33 974,758.29
Intercourse funds and other 6,273,372.70 7,416,277.35
Total 6,586,344.03 8,391,035.64
2) Accrual of bad debt provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit Expected credit losses for Expected credit losses for
Bad debt provision Total
losses over next 12 the entire duration (without the entire duration (with
months credit impairment occurred) credit impairment occurred)
Balance on Jan. 1, 2022 407,478.95 4,386,796.81 4,794,275.76
Balance of Jan. 1, 2022
in the period
Current accrual 66,084.99 66,084.99
Current reversal 21,871.90 21,871.90
Other change 1,488.10 1,488.10
Balance on Jun. 30, 2022 450,203.94 4,386,796.81 4,837,000.75
Change of book balance of loss provision with amount has major changes in the period
□Applicable √Not applicable
By account age
Unit: RMB/CNY
Account age Closing balance
Within one year (one year included) 1,574,778.10
Within 6 months 99,083.67
6 months to 1 year 1,475,694.43
1-2 years 405,363.61
2-3 years 61,394.73
Over three years 4,544,807.59
3-4 years 7,729.71
4-5 years 213,128.09
Over 5 years 4,323,949.79
Total 6,586,344.03
67
3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening Closing
Category Collected or
balance Accrual Written off Other balance
reversal
Provision for
bad debts based 4,794,275.76 66,084.99 21,871.90 1,488.10 4,837,000.75
on age
Total 4,794,275.76 66,084.99 21,871.90 1,488.10 4,837,000.75
4) Top 5 other account receivable collected by arrears party at ending balance
Unit: RMB/CNY
Proportion in total
other account Ending balance of
Enterprise Nature Closing balance Account age
receivables at bad debt provision
period-end
Shandong
Tianzong Culture Margin 299,000.00 1-2 years 4.54% 89,700.00
Media Co., Ltd.
Japan Daihatsu
Intercourse funds 288,896.39 Over 5 years 4.39% 288,896.39
Co., Ltd.
China Merchants
Bank Co., Ltd. Margin 245,100.00 2-3 years 3.72% 122,550.00
Qingdao Branch
DIVING-
Intercourse funds 207,072.50 Over 5 years 3.14% 207,072.50
SEAGULL
Wende Ship
Intercourse funds 200,000.00 Over 5 years 3.04% 200,000.00
Repair Company
Total 1,240,068.89 18.83% 908,218.89
5. Inventories
Whether implemented the new revenue standards
No
(1) Category
Unit: RMB/CNY
Closing balance Opening balance
Provision for Provision for
inventory inventory
depreciation or depreciation or
Item contract contract
Book balance Book value Book balance Book value
performance performance
cost cost
impairment impairment
provision provision
97,887,231.8 96,801,419.7 82,776,760.7 81,557,613.5
Raw materials 1,085,812.08 1,219,147.19
7 9 1 2
212,273,002. 209,609,621. 195,084,739. 189,773,954.
Inventory 2,663,381.28 5,310,785.27
55 27 68 41
Revolving
1,141,908.36 1,141,908.36 714,207.27 714,207.27
materials
68
Contract
performance 668,796.62 668,796.62
cost
Goods in transit 4,714,393.22 969,516.29 3,744,876.93
Low value
701,809.48 701,809.48 635,909.00 635,909.00
consumables
312,003,952. 308,254,758. 284,594,806. 277,095,357.
Total 3,749,193.36 7,499,448.75
26 90 50 75
(2) Provision for inventory depreciation or contract performance cost impairment provision
Unit: RMB/CNY
Current increased Current decreased
Item Opening balance Switch back or Closing balance
Accrual Other Other
charge-off
Raw materials 1,219,147.19 133,335.11 1,085,812.08
Inventory 5,310,785.27 2,647,403.99 2,663,381.28
Goods in transit 969,516.29 969,516.29
Total 7,499,448.75 3,750,255.39 3,749,193.36
6. Other current assets
Unit: RMB/CNY
Item Closing balance Opening balance
Input VAT ready for deduction 4,057,052.02 20,462,827.93
Income tax prepaid 103,543.07 104,950.69
Prepay other taxes 111,541.11 65,813.61
Total 4,272,136.20 20,633,592.23
7. Long-term equity investment
Unit: RMB/CNY
Current changes (+, -)
Ending
Investm Cash
Openin Other Accrual balance
ent dividen Ending
The g Additio compre of of
Capital gains Other d or balance
investe balance nal hensive impair impair
reducti recogni equity profit Other (book
d entity (book investm income ment ment
on zed change announ value)
value) ent adjustm provisi provisi
under ced to
ent on on
equity issued
I. Joint venture
II. Associated enterprise
Jinan
Qinyu
Food
2,382,3 2,382,3
Technol
45.00 45.00
ogy
Co.,
Ltd.
Subtota 2,382,3 2,382,3
l 45.00 45.00
Total 2,382,3 2,382,3
69
45.00 45.00
8. Investment real estate
(1) Measured at cost
√Applicable □Not applicable
Unit: RMB/CNY
Construction in
Item House and building Land use rights Total
progress
I. Original book value
1.Opening balance 51,308,578.35 51,308,578.35
2.Current increased
(1) Outsourcing
(2) Inventory\fixed
assets\construction in
process transfer-in
(3) Increased by
combination
3.Current decreased
(1) Disposal
(2) Other transfer-out
4.Closing balance 51,308,578.35 51,308,578.35
II. Accumulated
depreciation and
accumulated
amortization
1.Opening balance 20,313,133.54 20,313,133.54
2.Current increased 663,038.34 663,038.34
(1) Accrual or
663,038.34 663,038.34
amortization
3.Current decreased
(1) Disposal
(2) Other transfer-out
4.Closing balance 20,976,171.88 20,976,171.88
III. Impairment
provision
1.Opening balance 886,512.06 886,512.06
2.Current increased
(1) Accrual
3. Current decreased
(1) Disposal
(2) Other transfer-out
4.Closing balance 886,512.06 886,512.06
IV. Book value
1.Ending book value 29,445,894.41 29,445,894.41
2.Opening book value 30,108,932.75 30,108,932.75
70
(2) Measure on fair value
□Applicable √Not applicable
(3) Investment real estate without property certificate completed
Unit: RMB/CNY
Item Book value Reasons
Zhonglu Oceanic Building, No.43
29,361,375.76 See the notes
Heping Road, Jinan City
Other explanation
Pursuant to the Debt Compensation Opinion entered into between the Company and Shandong Aquatic Products Enterprise Group in
April 2006 and the civil verdict issued by People Court of Lixia district of Jinan city (2005 LZZDi-1299), Shandong Aquatic
Products Enterprise Group Co., Ltd. compensates for the debts of Shandong Zhonglu Oceanic Fisheries Co., Ltd. with its office
building located at No. 43, Heping Road, Lixia District, Jinan City and the office supplies, the originally determined book value of
the office building is 54,223,132.40 yuan, the book value is 31,807,244.79 yuan (the self-use part is included in the fixed assets, and
the rental part is included in the investment real estate), the property site was originally allocated and the property title certificate is
on hold.
9. Fixed assets
Unit: RMB/CNY
Item Closing balance Opening balance
Fixed assets 527,708,946.38 476,894,877.56
Total 527,708,946.38 476,894,877.56
(1) Fixed assets
Unit: RMB/CNY
House and Vessel and netting Machine Transportation Furniture and
Item Total
building gear equipment equipment office equipment
I. Original book
value：
1.Opening
123,131,088.57 635,972,457.95 62,092,102.73 9,211,315.93 11,082,537.05 841,489,502.23
balance
2.Current
48,714.75 84,402,311.70 539,384.23 195,850.75 165,782.88 85,352,044.31
increased
(1)
8,984.92 532,334.40 138,212.30 679,531.62
Purchasing
(2)
Construction in
58,727,101.87 58,727,101.87
progress transfer-
in
(3) Increased
by combination
(4) Fluctuations
48,714.75 25,666,224.91 7,049.83 195,850.75 27,570.58 25,945,410.82
in exchange
3.Current
32,691,026.26 9,159.50 32,700,185.76
decreased
(1) Disposal
32,691,026.26 9,159.50 32,700,185.76
or scrapping
4.Closing
123,179,803.32 687,683,743.39 62,631,486.96 9,407,166.68 11,239,160.43 894,141,360.78
balance
71
II. Accumulative
depreciation
1.Opening
37,829,371.76 282,378,158.59 29,198,385.63 6,143,680.84 8,887,454.35 364,437,051.17
balance
2.Current
1,328,251.04 28,144,826.38 1,870,914.71 850,604.87 708,827.18 32,903,424.18
increased
(1) Accrual 1,320,730.86 20,412,486.39 1,867,657.88 697,540.06 685,997.85 24,984,413.04
(2) Fluctuations
7,520.18 7,732,339.99 3,256.83 153,064.81 22,829.33 7,919,011.14
in exchange
3.Current
31,056,474.95 9,159.50 31,065,634.45
decreased
(1) Disposal
31,056,474.95 31,056,474.95
or scrapping
4.Closing
39,157,622.80 279,466,510.02 31,069,300.34 6,994,285.71 9,587,122.03 366,274,840.90
balance
III. Impairment
provision
1.Opening
157,573.50 157,573.50
balance
2.Current
increased
(1) Accrual
3.Current
decreased
(1) Disposal
or scrapping
4.Closing
157,573.50 157,573.50
balance
IV. Book value
1.Ending book
84,022,180.52 408,059,659.87 31,562,186.62 2,412,880.97 1,652,038.40 527,708,946.38
value
2.Opening
85,301,716.81 353,436,725.86 32,893,717.10 3,067,635.09 2,195,082.70 476,894,877.56
book value
(2) Fixed assets without property certificate obtained
Unit: RMB/CNY
Item Book value Causes
Zhonglu Oceanic Building, No.43
1,716,925.97 See the notes
Heping Road, Jinan City
Other explanation
Pursuant to the Debt Compensation Opinion entered into between the Company and Shandong Aquatic Products Enterprise Group in
April 2006 and the civil verdict issued by People Court of Lixia district of Jinan city (2005 LZZDi-1299), Shandong Aquatic
Products Enterprise Group Co., Ltd. compensates for the debts of Shandong Zhonglu Oceanic Fisheries Co., Ltd. with its office
building located at No. 43, Heping Road, Lixia District, Jinan City and the office supplies, the originally determined book value of
the office building is 54,223,132.40 yuan, the book value is 31,807,244.79 yuan (the self-use part is included in the fixed assets, and
the rental part is included in the investment real estate), the property site was originally allocated and the property title certificate is
on hold.
10. Construction in progress
Unit: RMB/CNY
Item Ending balance Opening balance
72
Construction in progress 166,987,910.20 165,273,027.75
Total 166,987,910.20 165,273,027.75
(1) Construction in progress
Unit: RMB/CNY
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Atlantic Seine
4,077,658.55 4,077,658.55 4,077,658.55 4,077,658.55
Item
Luqing Fishing
161 squid 7,112,575.38 7,112,575.38
fishing boat
Luqing Fishing
162 squid 7,346,386.83 7,346,386.83
fishing boat
Tailong 7 seine
49,525,000.00 49,525,000.00 25,875,000.00 25,875,000.00
boats
Tailong 9 seine
49,525,000.00 49,525,000.00 25,875,000.00 25,875,000.00
boats
Xinmaorong
transport 32,341,459.60 32,341,459.60
vessels
Business
66,722,605.94 66,722,605.94 66,722,605.94 66,722,605.94
premises
Zhonglu
Marine
1,215,304.26 1,215,304.26
Innovation
Industrial Park
Total 171,065,568.75 4,077,658.55 166,987,910.20 169,350,686.30 4,077,658.55 165,273,027.75
(2) Changes of major Construction in progress
Unit: RMB/CNY
Accum Includi
Propor
ulative ng:
tion of
Openi Curren Transf Closin amoun interes
Other project Work Capital Capital
Item ng t er to g t of t
Budget decrea invest progre izing resour
Name balanc increas fixed balanc interes capital
sing ment ss rate ces
e ed assets e t ization
in
capital in
budget
ization Period
Financ
Tailon
207,00 25,875 24,755 49,525 ial
g7 1,105, 28.30 28.30 950,00 950,00 100.00
0,000. ,000.0 ,089.1 ,000.0 Institut
seine 089.10 % % 0.00 0.00 %
00 0 0 0 ion
boats
Loans
Financ
Tailon
207,00 25,875 24,755 49,525 ial
g9 1,105, 28.30 28.30 950,00 950,00 100.00
0,000. ,000.0 ,089.1 ,000.0 Institut
seine 089.10 % % 0.00 0.00 %
00 0 0 0 ion
boats
Loans
Busine Financ
79,000 66,722 66,722
ss 84.46 84.46 ial
,000.0 ,605.9 ,605.9
premis % % Institut
0 4 4
es ion
73
Loans
49,51
493,0 118,4 2,210 165,7
0,178 1,900, 1,900,
Total 00,00 72,60 ,178. 72,60
.20 000.00 000.00
0.00 5.94 20 5.94
11. Right-of-use assets
Unit: RMB/CNY
Item House and building Total
I. Original book value
1.Opening balance 5,498,108.96 5,498,108.96
2.Current increased 57,482.40 57,482.40
3.Current decreased 1,848,775.14 1,848,775.14
4.Closing balance 3,706,816.22 3,706,816.22
II. Accumulative depreciation
1.Opening balance 3,143,165.10 3,143,165.10
2.Current increased 1,331,203.47 1,331,203.47
(1) Accrual 1,302,948.62 1,331,203.47
(2) Exchange impact 28,254.85
3.Current decreased 1,848,775.14 1,848,775.14
(1) Accrual 1,848,775.14 1,848,775.14
4.Closing balance 2,625,593.43 2,625,593.43
III. Impairment provision
1.Opening balance
2.Current increased
(1) Accrual
3.Current decreased
(1) Disposal
4.Closing balance
IV. Book value
1.Ending book value 1,081,222.79 1,081,222.79
2.Opening book value 2,354,943.86 2,354,943.86
12. Intangible assets
(1) Intangible assets
Unit: RMB/CNY
Non-patented
Item Land use rights Patent right Computer software Total
technology
I. Original book
value
1.Opening
17,154,729.00 2,331,484.03 19,486,213.03
balance
2.Current
52,255,113.26 52,255,113.26
increased
(1)
52,255,113.26 52,255,113.26
Purchasing
(2) Internal
R&D
74
(3) Increased
by combination
3.Current
decreased
(1) Disposal
4.Closing
69,409,842.26 2,331,484.03 71,741,326.29
balance
II. Accumulated
amortization
1.Opening
5,991,515.08 1,384,300.23 7,375,815.31
balance
2.Current
714,486.24 181,961.03 896,447.27
increased
(1) Accrual 714,486.24 181,961.03 896,447.27
3.Current
decreased
(1) Disposal
4.Closing
6,706,001.32 1,566,261.26 8,272,262.58
balance
III. Impairment
provision
1.Opening
balance
2.Current
increased
(1) Accrual
3.Current
decreased
(1) Disposal
4.Closing
balance
IV. Book value
1.Ending book
62,703,840.94 765,222.77 63,469,063.71
value
2.Opening book
11,163,213.92 947,183.80 12,110,397.72
value
13. Long-term prepaid expenses
Unit: RMB/CNY
Amortized in
Item Opening balance Current increased Other decreased Closing balance
Period
Renovation costs 220,738.00 4,288,012.48 4,335,398.80 0.00 173,351.68
Total 220,738.00 4,288,012.48 4,335,398.80 0.00 173,351.68
14. Deferred income tax asset /Deferred income tax liabilities
(1) Deferred income tax assets without offset
Unit: RMB/CNY
Closing balance Opening balance
Item
Deductible temporary Deferred income tax Deductible temporary Deferred income tax
75
differences asset differences asset
Asset impairment
891,919.22 222,979.80 891,919.22 222,979.80
provision
Deferred income 5,513,242.90 1,378,310.73 5,687,864.64 1,421,966.16
Total 6,405,162.12 1,601,290.53 6,579,783.86 1,644,945.96
(2) Deferred income tax liability without offset
Unit: RMB/CNY
Ending balance Opening balance
Item Taxable temporary Deferred income tax Taxable temporary Deferred income tax
differences liabilities differences liabilities
Fixed assets accelerated
10,809,595.68 2,702,398.91 11,110,357.81 2,777,589.45
depreciation
Total 10,809,595.68 2,702,398.91 11,110,357.81 2,777,589.45
(3) Amount of deferred income tax asset and deferred income tax liability after trade-off
Unit: RMB/CNY
Ending balance of Trade-off between the Opening balance of
Trade-off between the
deferred income tax deferred income tax deferred income tax
Item deferred income tax
assets or liabilities after assets and liabilities at assets or liabilities after
assets and liabilities
off-set period-begin off-set
Deferred income tax
1,601,290.53 1,644,945.96
asset
Deferred income tax
2,702,398.91 2,777,589.45
liabilities
(4) Deferred income tax asset without recognized
Unit: RMB/CNY
Item Closing balance Opening balance
Deductible temporary differences - bad
13,320,770.69 12,743,385.93
debt provision
Deductible Temporary Difference -
3,749,193.36 7,499,448.75
Inventory Impairment Reserve
Deductible Temporary Differences -
16,328,215.40
Deductible Losses
Deductible temporary differences-
Construction in progress provision for 4,077,658.55 4,077,658.55
impairment
Total 21,147,622.60 40,648,708.63
15. Other non-current asset
Unit: RMB/CNY
Closing balance Opening balance
Item Book Impairment Book Impairment
Book value Book value
balance provision balance provision
2,000,000. 2,000,000. 52,050,000 52,050,000
Account for lands paid in advance
00 00 .00 .00
Advance payment for construction in 50,180,917 50,180,917 91,087,267 91,087,267
progress and equipment .76 .76 .24 .24
52,180,917 52,180,917 143,137,26 143,137,26
Total
.76 .76 7.24 7.24
76
16. Short-term loans
(1) Category
Unit: RMB/CNY
Item Closing balance Opening balance
Mortgage loan 4,006,041.65 10,013,291.67
Total 4,006,041.65 10,013,291.67
17. Trading financial liabilities
Unit: RMB/CNY
Item Closing balance Opening balance
Trading financial liabilities 96,000.00
Including:
Including:
Total 96,000.00
18. Accounts payable
(1) Accounts payable
Unit: RMB/CNY
Item Closing balance Opening balance
Within one year (one year included) 38,858,179.48 45,582,797.03
Over one year 4,531,415.13 4,538,598.01
Total 43,389,594.61 50,121,395.04
19. Contract liability
Unit: RMB/CNY
Item Closing balance Opening balance
Advance payment 8,623,486.26 13,220,675.60
Total 8,623,486.26 13,220,675.60
20. Wage payable
(1) Wage payable
Unit: RMB/CNY
Increase during the Decrease during this
Item Opening balance Closing balance
period period
I. Short-term
42,756,190.82 74,016,618.41 91,399,294.98 25,373,514.25
compensation
II. Post-employment
welfare- defined 2,616,616.32 5,595,949.87 8,001,227.21 211,338.98
contribution plans
III. Dismissal welfare 30,578.89 46,421.88 -15,842.99
IV. Other welfare due
7,325.03 7,325.03
within one year
Total 45,410,711.06 79,612,568.28 99,446,944.07 25,576,335.27
77
(2) Short-term compensation
Unit: RMB/CNY
Increase during the Decrease during this
Item Opening balance Closing balance
period period
1. Wages,bonuses,allowances
41,313,575.06 66,738,935.81 84,039,252.77 24,013,258.10
and subsidies
2. Welfare for workers
1,718,704.81 1,718,704.81
and staff
3. Social insurance 2,665,949.39 2,665,949.39
Including: Medical
2,432,187.05 2,432,187.05
insurance
Work injury
225,897.42 225,897.42
insurance
Medical insurance
7,864.92 7,864.92
premiums (health care)
4. Housing accumulation
2,591,079.06 2,591,079.06
fund
5. Labor union
expenditure and
1,442,615.76 301,949.34 384,308.95 1,360,256.15
personnel education
expense
Total 42,756,190.82 74,016,618.41 91,399,294.98 25,373,514.25
(3) Defined contribution plans
Unit: RMB/CNY
Increase during the Decrease during this
Item Opening balance Closing balance
period period
1. Basic endowment
5,022,748.14 5,022,748.14
insurance
2. Unemployment
217,568.89 217,568.89
insurance
3. Enterprise annuity 2,616,616.32 176,615.30 2,581,892.64 211,338.98
Social security and
subsidies for retired 179,017.54 179,017.54
employees
Total 2,616,616.32 5,595,949.87 8,001,227.21 211,338.98
21. Taxes payable
Unit: RMB/CNY
Item Closing balance Opening balance
VAT 309,876.35 201,859.84
Corporate income ax 409,736.83 2,149,052.53
Individual income tax 83,061.21 329,417.86
Urban maintenance and construction tax 11,551.71 8,435.55
House property tax 193,153.61 242,944.78
Land use tax 277,121.04 121,326.11
Educational additional 5,117.37 3,797.96
Other tax 1,090,640.40 1,202,036.88
Total 2,380,258.52 4,258,871.51
22. Other accounts payable
Unit: RMB/CNY
78
Item Closing balance Opening balance
Other accounts payable 13,471,312.56 9,774,065.87
Total 13,471,312.56 9,774,065.87
(1) Other accounts payable
1) By nature
Unit: RMB/CNY
Item Closing balance Opening balance
Cash deposit 629,280.39 2,591,521.16
Employee cost 1,800,612.01 1,922,570.29
Other 11,041,420.16 5,259,974.42
Total 13,471,312.56 9,774,065.87
23. Non-current liabilities due within one year
Unit: RMB/CNY
Item Closing balance Opening balance
Long-term loans due within one year 700,000.00 3,200,000.00
Lease liabilities due within one year 1,097,180.34 1,709,314.65
Total 1,797,180.34 4,909,314.65
24. Other current liabilities
Unit: RMB/CNY
Item Ending balance Opening balance
Sales tax on advance receipts 61,937.73 14,100.55
Total 61,937.73 14,100.55
25、Long-term loans
(1) Category
Unit: RMB/CNY
Item Closing balance Opening balance
Mortgage loan 146,033,600.00 141,780,997.66
Loan in credit 7,612,534.71
Total 146,033,600.00 149,393,532.37
26. Long-term wages payable
(1) Long-term wages payable
Unit: RMB/CNY
Item Closing balance Opening balance
I. Post-employment welfare- net liability of
138,461.29 138,461.29
defined contribution plans
II. Dismissed welfare 245,879.19 245,879.19
III. Other long-term benefits 633,882.10 641,882.10
Total 1,018,222.58 1,026,222.58
79
27. Deferred income
Unit: RMB/CNY
Increase during Decrease during
Item Opening balance Closing balance Causes
the period this period
Government
Government
13,691,209.07 1,048,150.00 612,375.22 14,126,983.85 Grants Related to
subsidy
Assets
Total 13,691,209.07 1,048,150.00 612,375.22 14,126,983.85
Item with government subsidy concerned:
Unit: RMB/CNY
Amount Amount
Subsidy reckoned reckoned Cost Assets-
Opening increase into non- into non- reduction Other Closing related/
Liability
balance during this operation operation in the changes balance Income-
period revenue in revenue in period related
the Period the period
Constructio
7,929,748. 1,048,150. 8,473,150. Assets-
n special 504,748.20
40 00 20 related
fund
Financial
ship-
5,761,460. 5,653,833. Assets-
building 107,627.02
67 65 related
subsidy
funds
28. Share capital
Unit: RMB/CNY
Changes in the Period (+,-)
Opening Shares transfer Closing
Issuing new
balance Bonus shares from public Other Subtotal balance
shares
reserves
Total shares 266,071,320.00 266,071,320.00
29. Capital reserve
Unit: RMB/CNY
Increase during the Decrease during this
Item Opening balance Closing balance
period period
Capital premium (equity
189,093,492.79 11,565,274.27 200,658,767.06
premium)
Other capital reserve 94,961,504.96 94,961,504.96
Total 284,054,997.75 11,565,274.27 295,620,272.02
Other notes, including the current increase or decrease changes, changes in the reasons for the statement:In January 2022, the
company increased capital by 100 million yuan to its subsidiary, Shandong Province Zhonglu Yuanyang (Yantai) Food Co. , Ltd. ,
the company's direct shareholding ratio fell from 74.23% to 53.79% , while its indirect shareholding ratio fell from 25.77% to
18.67% . The minority shareholder, zhongtai Prudential Asset Management Co. , Ltd. , held 27.54% . This applies to the provisions
of article forty-nine of the accounting standards for enterprises 33-consolidated financial statements (2014 revision) , the Capital
Reserve shall be adjusted by the difference between the net assets enjoyed before the change in the share ratio and the net assets
enjoyed after the change in the share ratio.
30. Other comprehensive income
Unit: RMB/CNY
80
Current Period
Less:
Less: written written in
in other other
comprehensi comprehe
ve income in nsive Belong to Belong to
Account
previous income in
Opening before Less : income parent minority Closing
Item period and previous
balance income tax balance
carried period and tax expense company aftershareholders
in the
forward to carried
period tax after tax
gains and forward to
losses in retained
current earnings in
period current
period
II. Other comprehensive income - -
9,914,560. 7,634,270. 2,280,290.
items which will be reclassified 18,256,201. 10,621,9
subsequently to profit or loss 92 71 21
98 31.27
Differences of conversion - -
9,914,560. 7,634,270. 2,280,290.
of foreign currency financial 18,256,201. 10,621,9
statements 92 71 21
98 31.27
- -
9,914,560. 7,634,270. 2,280,290.
Total other comprehensive income 18,256,201. 10,621,9
92 71 21
98 31.27
31. Reasonable reserve
Unit: RMB/CNY
Increase during the Decrease during this
Item Opening balance Closing balance
period period
Safety production fee 232,783.00 494,302.97 310,977.22 416,108.75
Total 232,783.00 494,302.97 310,977.22 416,108.75
32. Surplus reserve
Unit: RMB/CNY
Increase during the Decrease during this
Item Opening balance Closing balance
period period
Statutory surplus
21,908,064.19 21,908,064.19
reserves
Total 21,908,064.19 21,908,064.19
33. Retained profit
Unit: RMB/CNY
Item Current period Last period
Retained profits at the end of last period before
379,524,911.94 343,997,929.71
adjustment
Retained profits at the beginning of the period
379,524,911.94 343,997,929.71
after adjustment
Add: net profit attributable to owners of parent
-9,019,125.78 35,526,982.23
company
Retained profit at period-end 370,505,786.16 379,524,911.94
81
34. Operating income and cost
Unit: RMB/CNY
Current Period Last Period
Item
Income Cost Income Cost
Main operating 365,737,998.47 364,824,763.13 352,484,940.52 337,994,874.52
Other operating 4,810,996.29 992,975.63 3,868,983.33 797,112.11
Total 370,548,994.76 365,817,738.76 356,353,923.85 338,791,986.63
Information relating to performance obligations:
The company handled the payment, transfer of goods and other business activities related to the performance obligations in
accordance with the contract, and the performance obligations related to the current operating income have been completed.
Information related to the transaction price apportioned to the remaining performance obligations:
The amount of income corresponding to the performance obligations that have been signed at the end of this reporting period but
have not yet been fulfilled or have not done with fulfillment is 0.00 yuan, among them, yuan of revenue is expected to be
recognized in YEAR, yuan of revenue is expected to be recognized in YEAR, and yuan of revenue is expected to be recognized
in YEAR.
Information related to the transaction price apportioned to the remaining performance obligations:
The amount of income corresponding to the performance obligations that have been signed at the end of this reporting period but
have not yet been fulfilled or have not done with fulfillment is 0.00 yuan, among them, yuan of revenue is expected to be
recognized in YEAR, yuan of revenue is expected to be recognized in YEAR, and yuan of revenue is expected to be recognized
in YEAR.
Other explanation
Revenue from contracts
(1) Operating revenue by time of recognition
Item Product sales OEM income Cold storage fee Other business
revenue income income
Recognized at a point in time 307,353,954.94 3,492,728.20 - 2,452,797.78
Recognized within a certain time period - - 6,077,831.30 -
Total 307,353,954.94 3,492,728.20 6,077,831.30 2,452,797.78
(2) Revenue from application leasing standards
Item
Boat rental House rental and other
Main business income 48,813,484.03 -
Other business income - 2,358,198.51
Total 48,813,484.03 2,358,198.51
35. Tax and surcharges
Unit: RMB/CNY
Item Current Period Last Period
Urban maintenance and construction tax 23,456.65 69,894.87
Educational surtax 10,017.56 29,954.77
House property tax 911,202.45 602,517.82
Land use tax 505,100.21 300,483.73
Vehicle and vessel tax 1,636.68 25,607.68
82
Stamp tax 116,889.48 60,258.99
Local education surcharge 6,678.36 19,969.85
Local water conservancy construction
-301.63
fund
Total 1,574,981.39 1,108,386.08
36. Sales expenses
Unit: RMB/CNY
Item Current Period Last Period
Employee's salary 953,992.32 844,104.45
Business promotion fee 238,660.36 261,033.13
Travel expenses 7,817.80 57,769.04
Depreciation 56,918.60 62,116.87
Other 187,960.29 244,629.45
Total 1,445,349.37 1,469,652.94
37. Administrative expenses
Unit: RMB/CNY
Item Current Period Last Period
Payroll payable 15,642,222.75 17,768,595.10
Accumulated depreciation and
944,275.86 903,685.35
amortization
Travelling charge 830,012.14 453,304.98
Business entertainment 222,761.89 302,739.27
Vehicles charge 445,322.50 378,499.79
Intermediary service fee 164,535.87 205,838.15
Office allowance 219,585.23 169,196.61
Property water and electricity 759,509.61 525,692.59
Depreciation of right-of-use assets 928,672.60
Other 5,482,826.92 5,897,295.86
Total 25,639,725.37 26,604,847.70
38. R&D expenses
Unit: RMB/CNY
Item Current Period Last Period
Employee's salary 293,851.00
Material 9,626.24
Other 29,066.72
Total 332,543.96
39. Financial expenses
Unit: RMB/CNY
Item Current Period Last Period
Interest costs 1,350,577.27 908,617.14
Less: interest income 179,373.83 358,030.77
Exchange loss -4,218,361.31 3,058,828.97
Handing expense 366,973.75 408,469.21
Interest expense on lease liability 8,128.89
83
Other expense 39,774.42 50,763.29
Total -2,632,280.81 4,068,647.84
Other note: Exchange gains in the current period due to exchange rate fluctuations are larger than the exchange losses in the
previous period.
40. Other income
Unit: RMB/CNY
Sources Current Period Last Period
Shipbuilding financial discount 107,627.02 99,688.00
Financial subsidies for special
construction funds of the Blue Economic 349,243.44 369,133.74
Zone
Special funds for cold chain logistics 141,211.80 157,297.65
Tax rebate on individual 22,928.75 18,799.45
Job stabilization subsidy 590.93
Ammonia refrigeration media retrofit
14,292.96
support subsidy
Other 52,205.35 191,000.00
Total 688,100.25 835,918.84
41. Investment income
Unit: RMB/CNY
Item Current Period Last Period
Investment income of trading financial assets
1,076,034.24 49,972.60
during the holding period
Total 1,076,034.24 49,972.60
42. Income of fair value changes
Unit: RMB/CNY
Sources Current Period Last Period
Trading financial liabilities -96,000.00
Total -96,000.00
43. Credit impairment loss
Unit: RMB/CNY
Item Current Period Last Period
Credit impairment losses on accounts
369,577.28 -304,060.94
receivable
Credit impairment losses on other
-8,829.93 115,685.07
receivables
Total 360,747.35 -188,375.87
44. Assets impairment loss
Unit: RMB/CNY
Item Current Period Last Period
84
II. Loss of inventory depreciation and loss
-241,910.58
of contract performance cost impairment
Total -241,910.58
45. Income from assets disposal
Unit: RMB/CNY
Sources Current Period Last Period
Gains/losses of fixed assets disposal 5,105,581.41 -41,980.15
46. Non-operating income
Unit: RMB/CNY
Amount reckoned in current
Item Current Period Last Period
non-recurring gains/losses
Indemnity income 17,073.10 34,284.70 17,073.10
Other 19,927.00 19,927.00
Total 37,000.10 34,284.70
47. Non-operating expenses
Unit: RMB/CNY
Amount reckoned in current
Item Current Period Last Period
non-recurring gains/losses
Loss from scrapped fixed
438.61
assets
Late payment fee 108.69
Other 1,337.00 6,674.28 1,337.00
Total 1,337.00 7,221.58
48. Income tax expenses
(1) Statement of income tax expense
Unit: RMB/CNY
Item Current Period Last Period
Current income tax expense 314,456.95 399,605.91
Deferred income tax expenses 43,655.43
Total 358,112.38 399,605.91
(2) Adjustment on accounting profit and income tax expenses
Unit: RMB/CNY
Item Current Period
Total profit -14,458,936.93
Income tax based on statutory/applicable rate
Impact on different tax rate applicable for subsidiary 314,456.95
Effect of unrecognised deductible temporary differences and
43,655.43
deductible losses in current period
Income tax expense 358,112.38
85
49. Other comprehensive income
See Note X (VII) 30.
50. Items of cash flow statement
(1) Other cash received in relation to operation activities
Unit: RMB/CNY
Item Current Period Last Period
Financial expenses-interest income 209,168.93 171,947.83
Government subsidy and other non-
1,082,566.91 190,980.31
operating income
Cash deposit for L/C 76,370.28
Intercourse funds and other 10,438,026.46 4,892,017.14
Total 11,729,762.30 5,331,315.56
(2) Other cash paid in relation to operation activities
Unit: RMB/CNY
Item Current Period Last Period
Sales expenses paid in cash 7,836,790.46 6,027,526.39
Expenses of management cash paid 7,463,756.44 9,840,133.10
Pay cash for R&D expenses 4,039.00
Cash deposit for L/C 233,800.00
Intercourse funds and other 2,935,295.14 9,368,694.52
Total 18,239,881.04 25,470,154.01
(3) Other cash paid related with financing activities
Unit: RMB/CNY
Item Current Period Last Period
Pay the lease payment 652,967.28
Total 652,967.28
51. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
Unit: RMB/CNY
Supplementary information Current period Last period
1. Net profit adjusted to cash flow of
operation activities:
Net profit -14,817,049.31 -15,648,515.29
Add: Impairment provision for assets -360,747.35 430,286.45
Depreciation of fixed assets, consumption of
oil assets and depreciation of productive 24,984,413.04 23,040,577.46
biology assets
Depreciation of right-of-use assets 1,104,702.78
Amortization of intangible assets 896,447.27 371,758.62
Amortization of long-term pending expenses 4,822,591.49 149,284.89
86
Loss from disposal of fixed assets, intangible
assets and other long-term assets (income is 5,105,581.41 41,980.15
listed with “-”)
Losses on scrapping of fixed assets (income
438.61
is listed with “-“)
Loss from change of fair value (income is
96,000.00
listed with “-“)
Financial expenses (income is listed with “-
-2,632,280.81 3,967,446.10
”)
Investment loss (income is listed with “-”) -1,076,034.24 -49,972.60
Decrease of deferred income tax assets
43,655.43 65,978.11
(increase is listed with “-”)
Decrease of deferred income tax asset
-75,190.54 -39,692.97
((increase is listed with “-”)
Decrease of inventory (increase is listed with
-31,159,401.15 -2,245,435.29
“-”)
Decrease of operating receivable accounts
-26,306,042.37 -11,912,557.39
(increase is listed with “-”)
Increase of operating payable accounts
-29,344,731.86 -49,082,177.35
(decrease is listed with “-”)
Other
Net cash flow arising from operating
-68,718,086.21 -50,910,600.50
activities
2. Material investment and financing not
involved in cash flow
Conversion of debt into capital
Switching Company bonds due within one
year
financing lease of fixed assets
3. Net change of cash and cash equivalents:
Balance of cash at period end 212,936,131.11 186,855,639.29
Less: Balance of cash at year-begin 209,649,305.99 255,735,611.93
Add: Balance at year-end of cash equivalents
Less: Balance at year-begin of cash
equivalents
Net increasing of cash and cash equivalents 3,286,825.12 -68,879,972.64
(2) Constitution of cash and cash equivalent
Unit: RMB/CNY
Item Closing balance Opening balance
I. Cash 212,936,131.11 209,649,305.99
Including: Cash on hand 2,499,175.46 1,975,275.82
Bank deposit available for payment
210,436,955.65 207,674,030.17
at any time
III. Balance of cash and cash equivalent at
212,936,131.11 209,649,305.99
period-end
52. Assets with ownership or use right restricted
Unit: RMB/CNY
Item Ending book value Restriction reasons
Fixed assets 30,433,094.38 Mortgage loan
Intangible assets 4,915,678.15 Mortgage loan
Construction in progress 66,722,605.94 Mortgage loan
Total 102,071,378.47
87
53. Item of foreign currency
(1) Item of foreign currency
Unit: RMB/CNY
Closing balance of foreign Ending RMB balance
Item Rate of conversion
currency converted
Monetary fund 116,974,656.40
Including: USD 12,223,180.78 6.685 81,711,963.51
EUR 75,648.22 7.0643 534,401.72
HKD
JPY 620,051,745.00 0.0495 30,692,561.38
CEDI 4,115,163.50 0.9265 3,812,698.98
XOF 20,651,000.00 0.0108 223,030.80
Account receivable 28,356,137.96
Including: USD 2,935,457.37 6.685 19,623,532.52
EUR
HKD
JPY 168,907,831.80 0.0495 8,360,937.67
CEDI 401,152.48 0.9265 371,667.77
Long-term loans 97,333,600.00
Including: USD 14,560,000.00 6.685 97,333,600.00
EUR
HKD
(2) Explanation on foreign operational entity, including as for the major foreign operational entity,
disclosed main operation place, book-keeping currency and basis for selection; if the book-keeping
currency changed, explain reasons
√Applicable □Not applicable
Foreign main operation Book-keeping
Major foreign operation entity Basis
place currency
HABITAT INTERNATIONAL CORPORATION Panama USD The economic environment
in the operation sites
LAIF FISHERIES COMPANY LIMITED Ghana USD The economic environment
in the operation sites
YAW ADDO FISHERIES COMPANY LIMITED Ghana USD The economic environment
in the operation sites
ZHONG GHA FOODS COMPANY LIMITED Ghana USD The economic environment
in the operation sites
AFRICA STAR FISHERIES LIMITED Ghana USD The economic environment
in the operation sites
54. Government subsidy
(1) Government subsidy
Unit: RMB/CNY
Amount reckoned into current
Category Amount Item presented
gain/loss
Individual tax procedure
23,425.21 Other income 23,425.21
refund
88
Job Stabilization Subsidy 590.93 Other income 590.93
Ammonia refrigeration media
1,048,150.00 Deferred income 14,292.96
retrofit support subsidy
VIII. Changes of consolidation scope
There was no change in the company's consolidation scope during the reporting period.
IX. Equity in Other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Main operation Registered Share-holding ratio
Subsidiary Business nature Acquired way
place place Directly Indirectly
Shandong
Zhonglu
Qingdao Qingdao Refrigerated
Fishery 100.00% Investment
Shandong Shandong transport
Shipping Co.,
Ltd.
Shandong
Zhonglu
Yantai Yantai Food
Oceanic 53.79% 18.67% Investment
Shandong Shandong processing
(Yantai) Foods
Co., Ltd.
Shandong
Zhonglu
Qingdao Qingdao
Haiyan Deep- Pelagic fishing 59.05% Investment
Shandong Shandong
sea Fishery Co.,
Ltd
Zhonglu
Oceanic
(Qingdao)
Qingdao Qingdao
Industrial 51.00% 49.00% Investment
Shandong Shandong
Investment
Development
Co., Ltd
HABITAT
INTERNATIO
Refrigerated
NAL Panama Panama 100.00% Investment
transport
CORPORATIO
N
LAIF
FISHERIES
Ghana Ghana Pelagic fishing 100.00% Investment
COMPANY
LIMITED
AFRICA
STAR
Ghana Ghana Pelagic fishing 100.00% Investment
FISHERIES
LIMITED
ZHONG
GHA FOODS Ghana Ghana Pelagic fishing 100.00% Investment
COMPANY
89
LIMITED
Shandong
Zhonglu Ocean Yantai Yantai Refrigeration
100.00% Investment
Refrigerated Shandong Shandong service
Co., Ltd
YAW
ADDO
FISHERIES Ghana Ghana Pelagic fishing Operating lease
COMPANY
LIMITED
(2) Important non-wholly-owned subsidiary
Unit: RMB/CNY
Gains/losses Dividend announced to
Share-holding ratio of Ending equity of
Subsidiary attributable to minority distribute for minority
minority minority
in the Period in the Period
Shandong Zhonglu
Haiyan Deep-sea 40.95% -8,209,058.13 156,054,951.36
Fishery Co., Ltd
Shandong Zhonglu
Oceanic (Yantai) 27.54% 2,411,134.60 90,845,860.33
Foods Co., Ltd.
(3) Main finance of the important non-wholly-owned subsidiary
Unit: RMB/CNY
Closing balance Opening balance
Curren Non- Curren Non-
Subsid Non- Total Non- Total
Curren Total t current Curren Total t current
iary current liabilit current liabiliti
t assets assets liabilit liabilit t assets assets liabilit liabilit
assets ies assets es
y y y y
Shand
ong
Zhongl
u
218,48 233,18 451,67 64,930 70,584 230,07 228,55 458,63 57,308 63,069
Haiyan 5,653, 5,761,
6,503. 4,756. 1,260. ,854.0 ,687.7 8,254. 6,206. 4,460. ,361.8 ,822.5
Deep- 833.65 460.67
17 87 04 8 3 48 12 60 6 3
sea
Fisher
y Co.,
Ltd
Shand
ong
Zhongl
u
Oceani 261,92 130,69 392,62 51,576 11,175 62,752 174,44 131,69 306,14 74,321 10,707 85,029
c 4,569. 6,243. 0,812. ,489.6 ,549.1 ,038.7 4,432. 8,553. 2,986. ,902.6 ,337.8 ,240.4
(Yanta 41 27 68 8 1 9 90 85 75 1 5 6
i)
Foods
Co.,
Ltd.
Unit: RMB/CNY
Subsidiary Current Period Last Period
90
Total Cash flow Total Cash flow
Operation comprehen from Operation comprehen from
Net profit Net profit
Income sive operation Income sive operation
income activity income activity
Shandong
Zhonglu
- - - - - -
Haiyan 70,960,103 54,095,017
20,046,540 14,478,065 63,483,126 16,334,906 17,930,791 29,073,713
Deep-sea .41 .11
.01 .76 .67 .54 .36 .65
Fishery
Co., Ltd
Shandong
Zhonglu
Oceanic 247,788,33 8,755,027. 8,755,027. 38,520,754 232,762,46 8,679,009. 8,679,009. 22,960,472
(Yantai) 5.98 60 60 .41 8.89 21 21 .12
Foods Co.,
Ltd.
2. Transaction that has owners equity shares changed in subsidiary but still with controlling rights
(1) Owners equity shares changed in subsidiary
In January 2022, Zhongtai Xincheng Asset Management Co., Ltd. increased capital to the company's subsidiary, Shandong
Zhonglu Oceanic (Yantai) Foods Co., Ltd with 100 million yuan. After capital increased, ratio of the shareholding directly down
to 53.79% from 74.23%, ratio of shareholding in-directly down to 18.67% from 25.77%. among the minority shareholders,
shareholding of Zhongtai Xincheng Asset Management Co., Ltd was 27.54%.
(2) Impact on minority’s interest and owners’ equity attributable to parent company
Unit: RMB/CNY
Purchase cost/disposal consideration 0.00
--Cash
--Fair value of non-cash assets
Purchase cost/total disposal consideration 0.00
Less: Subsidiary's share of net assets calculated based on the
11,565,274.27
proportion of acquired/disposed equity
Difference -11,565,274.27
Including: Adjust the capital reserve 11,565,274.27
Adjusted surplus reserve
Adjusted undistributed profit
Other explanation
In January 2022, Zhongtai Xincheng Asset Management Co., Ltd. increased capital to the company's subsidiary, Shandong Zhonglu
Oceanic (Yantai) Foods Co., Ltd., resulting in a decrease in the Company's shareholding ratio, but without losing the control. The
Company includes the changes in the share of net assets it enjoyed according to the shareholding ratio before and after the capital
increase in the capital reserve.
91
3. Equity in joint venture and associated enterprise
(1) Financial summary for non-important Joint venture and associated enterprise
Unit: RMB/CNY
Closing balance /Current Period Opening balance /Last Period
Joint venture:
Amount based on share-holding ratio
Associated enterprise:
Total book value of investment 2,382,345.00
Amount based on share-holding ratio
X. Risks related to financial instruments
The financial assets of the Company include accounts receivable and other receivables. The financial liabilities of
the Company include accounts payable, other account payable and short-term loans. For details of each financial
instrument, please refer to the relevant items in Note VI. The Company is faced with the risks of various financial
instruments in its daily activities, mainly including credit risk, liquidity risk and market risk. The board of
directors is responsible for establishing and supervising the risk management structure of the Company and
developing and monitoring the Company's risk management policies.
Risk management objectives and policies: the Company's goal of risk management is to strike a proper balance
between risks and profits, minimize the negative impacts of the risks on the Company's operating results and
maximize the benefits of shareholders and other equity investors.
1. Credit risk
If the customer or the other party involving in the financial instruments cannot fulfill the obligations under the
contract and cause financial losses to the Company, that is credit risk. Credit risk is mainly from the customer
receivables. The book value of account receivables and notes receivable and other receivables is the maximum
credit risk of the Company for financial assets.
2. Liquidity risk
Liquidity risk is the risk of the shortage of funds when the Company is fulfilling its obligations related to financial
liabilities. In the case of normal and tense funds, the Company needs to ensure that there is sufficient liquidity to
meet its due debts and negotiate with financial institutions for financing so as to maintain a certain level of reserve
credit line to reduce the liquidity risk.
3. Market risk
(1) Foreign exchange risk
Foreign exchange risk refers to the risk that the fair value of financial instruments or the future cash flows
fluctuate due to changes in foreign exchange rates. The foreign exchange risk faced by the Company mainly
comes from the financial assets valued in US dollars, and the amount of foreign currency financial assets
converted into RMB is listed as described in X-(vii)-53 foreign currency monetary items.
(2) Interest rate risk
92
Interest rate risk refers to the risk that the fair value of financial instruments or future cash flows fluctuate due to
changes in market interest rates. The interest rate risk faced by the Company mainly comes from the long-term
bank loans, the Company’s loans are floating interest rate, and there is risk of RMB benchmark interest rate
change.
XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
Unit: RMB/CNY
Ending fair value
Item
First-order Second-order Third-order Total
I. Sustaining measured
-- -- -- --
by fair value
(vi) Trading financial
96,000.00 96,000.00
liabilities
Derivative
96,000.00 96,000.00
financial liabilities
II. Non-persistent
-- -- -- --
measure
2. Recognized basis for the market price sustaining and non-persistent measured by fair value on first-
order
The unadjusted quoted prices in active markets for identical assets or liabilities
3. Valuation technique and qualitative and quantitative information on major parameters for the fair
value measure sustaining and non-persistent on second-order
Inputs other than level 1 inputs that are directly or indirectly observable for the related assets and liabilities
4. Valuation technique and qualitative and quantitative information on major parameters for the fair
value measure sustaining and non-persistent on third-order
Unobservable inputs for the related asses or liabilities
5. Sustaining items measured by fair value, as for the conversion between at all levels, reasons for
conversion and policy for conversion time point
There were no conversion between levels of the above items that are measured at fair value on an ongoing basis
during the reporting period
6. Changes of valuation technique in the Period
No changes in valuation technique occurred during the reporting period.
93
XII. Related party and related transactions
1. Parent company of the enterprise
Share-holding
ratio on the Voting right ratio
Parent company Registered place Business nature Registered capital
enterprise for on the enterprise
parent company
Investment and
management,
Shandong State-
management and
owned Assets
operation of
Investment Jinan Shandong 4500 million Yuan 47.25% 47.25%
assets, managed
Holding Company
operations,
Limited
investment
advisory
Ultimate controller of the Company is Shandong State-owned Assets Investment Holdings Co., Ltd.
2. Subsidiary of the Enterprise
Found more in Note IX. Equity in subsidiary
3. Joint venture and associated enterprise
Important joint venture and associated enterprise of the Company found more in the in Note IX-Interest in Other Entity.
4. Other related party
Other related party Relationship with the Enterprise
Inspur General Software Co., Ltd. Control by same parent company
Bank of Dezhou Co., Ltd. Control by same parent company
Zhongtai Xincheng Asset Management Co., Ltd. Control by same parent company
Qingdao Qingyu Fishing Boat Repair Co. , Ltd. Control by same parent company
5. Related transaction
(1) Related trusteeship management/contract & entrust management/ outsourcing
Trusteeship management/contract:
Unit: RMB/CNY
Managed
Managed
earnings
Entrusting earnings
Client/Contract Trustee/assets confirmed in
party/Contracto Trustee /start Trustee /ends /pricing of the
-out party contract the period /
r contract
contract
earnings
earnings
Shandong Shandong
State-owned Zhonglu Ocean Delegated
2022-04-14 Flat fee 0.00
Assets Fishery Co., management
Investment Ltd.
94
Holding Co.,
Ltd.
(2) Related lease
As lessee:
Unit: RMB/CNY
rental cost for
Variable lease
short-term leases
payment not
and low-value Interest expenses
included in the Right-of-use assets
assets leases with Rental paid assumed on lease
Assets measurement of increased
Lessor simplified liability
type leasing liability (if
processing (if
applicable)
applicable)
Current Last Current Last Current Last Current Last Current Last
Period Period Period Period Period Period Period Period Period Period
Zhongt
ai
Xinche
ng Office
195,000 195,000 8,128.8
Asset buildin
.00 .00 9
Manage g
ment
Co.,
Ltd.
Qingda
o
Qingyu
Fishing
Vessel
28,700. 16,000.
Repair Vehicle
00 00
&
Manufa
cture
Co.,
Ltd.
(3) Remuneration of key manager
Unit: RMB/CNY
Item Current Period Last Period
Remuneration of key manager 855,189.00 845,236.00
(4) Other related transactions
Interest income
Name Related party Current Period Last Period
Deposit interest income Bank of Dezhou Co., Ltd 1329.03 751.00
Total 1329.03 751.00
95
6. Receivable/payable items of related parties
(1) Receivable item
Unit: RMB/CNY
Closing balance Opening balance
Item Name Related party
Book balance Bad debt provision Book balance Bad debt provision
Inspur General
Prepayments 394,857.06 394,857.06
Software Co., Ltd.
XIII. Commitment or contingency
1. Important commitment
Important commitment on balance sheet date
No commitments that need to released ended as the reporting period
2. Contingency
(1) If the Company has no important contingency need to disclosed, explain reasons
The Company has no important contingency that need to disclose.
XIV. Event occurring after balance sheet date
1. Other explanation on events after balance sheet date
No events after balance sheet date need to released up to reporting period
XV. Other important event
1. Pension plan
In accordance with relevant laws, regulations and policies, the Company has established an enterprise annuity
system, and on the basis of participating in basic pension insurance in accordance with the law, it pays
supplementary pension insurance (i.e., enterprise annuity) for employees. Each year, according to the actual
operating conditions, the operating efficiency coefficient is set, and the total amount of corporate contributions is
calculated according to the operating efficiency coefficient; the expenses to be assumed by the company in the
enterprise annuity have been disclosed in the employee compensation payable - defined contribution plans, and
the individual payment of employees is withheld and paid from employee wages by the company. 176,600 yuan
enterprise annuity are accrual in the year. For relevant disclosures, please refer to "Note X. (vii) 20 Wages
Payable".
96
2. Segment information
(1) Determination basis and accounting policy for segment
Main operation of the Company including pelagic fishing, cold storage processing trade of aquatic products,
vessel leasing and other operations. Segment disclosure is released by the business nature.
(2) Financial information of the segment
Unit: RMB/CNY
Cold storage
processing Offset between
Item Pelagic fishing Vessel leasing Other Total
trade of aquatic segment
products
I. Main
operating 111,100,654.53 48,813,484.03 245,335,538.20 96,422.69 -39,608,100.98 365,737,998.47
income
II. Main
126,148,503.07 45,672,777.17 232,539,807.35 71,776.52 -39,608,100.98 364,824,763.13
operating cost
III. Credit
-756,592.63 14,222.71 381,622.57 -360,747.35
impairment loss
IV.
Depreciation
21,832,511.37 5,616,390.64 3,893,940.63 1,199,138.67 32,541,981.31
and
amortization
V. Total profit -21,621,680.82 8,395,385.01 8,793,978.46 -10,026,619.58 -14,458,936.93
VI. Income tax 49,206.95 308,905.43 358,112.38
VII. Net profit -21,621,680.82 8,346,178.06 8,485,073.03 -10,026,619.58 -14,817,049.31
VIII. Total - 1,454,088,170.
734,868,343.54 220,672,561.70 456,731,448.61 199,632,380.07
assets 157,816,563.00 92
IX. Total
101,478,720.57 15,774,362.64 63,260,068.71 173,493,206.83 -90,723,006.47 263,283,352.28
liability
XVI. Principle notes of financial statements of parent company
1. Account receivable
(1) Category
Unit: RMB/CNY
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Including:
Account receivable
with bad debt 9,428,90 5,596,78 3,832,118 14,879,60 6,148,547 8,731,060.8
100.00% 59.36% 100.00% 41.32%
provision accrual by 6.10 7.44 .66 8.37 .53 4
portfolio
Including:
Unrelated party 9,428,90 5,596,78 3,832,118 14,879,60 6,148,547 8,731,060.8
100.00% 59.36% 100.00% 41.32%
portfolio 6.10 7.44 .66 8.37 .53 4
9,428,90 5,596,78 3,832,118 14,879,60 6,148,547 8,731,060.8
Total 100.00% 59.36% 100.00% 41.32%
6.10 7.44 .66 8.37 .53 4
Accrual bad debt provision on portfolio: 5,596,787.44
97
Unit: RMB/CNY
Closing balance
Name
Book balance Bad debt provision Accrual ratio
Account receivable with
provision for bad debts based
9,428,906.10 5,596,787.44 59.36%
on a portfolio of non-related
parties
Total 9,428,906.10 5,596,787.44
If the provision for bad debts of account receivable is made in accordance with the general model of expected
credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-
debt provisions:
□Applicable √Not applicable
By account age
Unit: RMB/CNY
Account age Closing balance
Within one year (one year included) 3,832,118.66
Within 6 months 3,832,118.66
Over three years 5,596,787.44
Over 5 years 5,596,787.44
Total 9,428,906.10
(2) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening Closing
Category Collected or
balance Accrual Charge-off Other balance
reversal
Account
6,148,547.53 551,760.09 5,596,787.44
receivable
Total 6,148,547.53 551,760.09 5,596,787.44
(3) Top five account receivables collected by arrears party at ending balance
Ending balance of accounts Proportion in total receivables Bad debt preparation ending
Enterprise
receivable at ending balance (%) balance
Shandong Zhonglu Oceanic
3,832,118.66 40.64% 0.00
(Yantai) Foods Co., Ltd.
PANDA CO.LTD 3,600,962.12 38.19% 3,600,962.12
Haifeng co., ltd. 430,625.10 4.57% 430,625.10
Han Xue 293,209.20 3.11% 293,209.20
Lv Ming 158,154.98 1.68% 158,154.98
Total 8,315,070.06 88.19%
2. Other account receivable
Unit: RMB/CNY
Item Closing balance Opening balance
Dividend receivable 70,637,061.83 85,085,303.70
Other account receivable 49,364,523.02 33,929,882.66
98
Total 120,001,584.85 119,015,186.36
(1) Dividend receivable
1) Category
Unit: RMB/CNY
Item (or invested company) Closing balance Opening balance
Subsidiary Dividends Receivable 70,637,061.83 85,085,303.70
Total 70,637,061.83 85,085,303.70
2) Major dividend receivable with over one year aged
Unit: RMB/CNY
Whether has
Item (or invested Causes of failure for impairment occurred
Closing balance Account age
company) collection and determination
basis
Considering the
production and
HABITAT
operation of subsidiary,
INTERNATIONAL 70,637,061.83 Within 1-3 years No impairment
payment is not
CORPORATION
required for the time
being
Total 70,637,061.83
(2) Other account receivable
1) By nature
Unit: RMB/CNY
Nature Closing book balance Opening book balance
Internal contacts 50,629,115.02 33,377,123.62
Petty cash and other 2,340,560.70 4,148,691.43
Less: Provision for bad debts -3,605,152.70 -3,595,932.39
Total 49,364,523.02 33,929,882.66
2) Accrual of bad debt provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit Expected credit losses for Expected credit losses for
Bad debt provision Total
losses over next 12 the entire duration (without the entire duration (with
months credit impairment occurred) credit impairment occurred)
Balance on Jan. 1, 2022 3,595,932.39 3,595,932.39
Balance of Jan. 1, 2022
in the period
Current accrual 9,220.31 9,220.31
Balance on Jun. 30, 2022 3,605,152.70 3,605,152.70
Change of book balance of loss provision with amount has major changes in the period
□Applicable √Not applicable
99
By account age
Unit: RMB/CNY
Account age Closing balance
Within one year (one year included) 16,476,727.34
1-2 years 1,329,215.82
2-3 years 15,504.31
Over three years 35,148,228.25
3-4 years 3,553,211.05
4-5 years 12,343,655.62
Over 5 years 19,251,361.58
Total 52,969,675.72
3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening Closing
Category Collected or
balance Accrual Written off Other balance
reversal
Other
3,595,932.39 9,220.31 3,605,152.70
Receivables
Total 3,595,932.39 9,220.31 3,605,152.70
4) Top 5 other account receivable collected by arrears party at ending balance
Unit: RMB/CNY
Proportion in total
other account Ending balance of
Enterprise Nature Closing balance Account age
receivables at bad debt provision
period-end
LAIF
FISHERIES
Intercourse funds 15,417,912.67 0-3 years or more 29.11%
COMPANY
LIMITED
Shandong Zhonglu
Fishery Shipping Intercourse funds 7,951,473.53 0-3 years or more 15.01%
Co., Ltd.
YAW ADDO
FISHERIES
Intercourse funds 7,341,932.34 0-3 years or more 13.86%
COMPANY
LIMITED
AFRICA STAR
FISHERIES Intercourse funds 6,272,764.44 0-3 years or more 11.84%
LIMITED
ZHONG GHA
FOODS
Intercourse funds 3,314,349.48 0-3 years or more 6.26%
COMPANY
LIMITED
Total 40,298,432.46 76.08%
100
3. Long-term equity investments
Unit: RMB/CNY
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Investment for
232,189,455.23 232,189,455.23 232,189,455.23 232,189,455.23
subsidiary
Total 232,189,455.23 232,189,455.23 232,189,455.23 232,189,455.23
(1) Investment for subsidiary
Unit: RMB/CNY
Changes in the period (+,-) Ending
Opening Closing
The invested Accrual of balance of
balance Additional Capital balance
entity impairment Other impairment
(Book value) investment reduction (Book value)
provision provision
HABITAT
INTERNATI 12,476,145.6 12,476,145.6
ONAL 0 0
CORP.
Shandong
Zhonglu
22,869,513.3 22,869,513.3
Fishery
8 8
Shipping Co.,
Ltd.
Shandong
Zhonglu
Oceanic 55,448,185.2 55,448,185.2
(Yantai) 4 4
Foods Co.,
Ltd.
Shandong
Zhonglu
141,395,611. 141,395,611.
Haiyan Deep-
01 01
sea Fishery
Co., Ltd
232,189,455. 232,189,455.
Total
23 23
4. Operating income and cost
Unit: RMB/CNY
Current Period Last Period
Item
Income Cost Income Cost
Main operating 41,543,053.81 42,013,560.14 33,468,179.96 30,992,416.58
Other operating 2,358,198.51 992,975.63 2,065,666.90 797,112.11
Total 43,901,252.32 43,006,535.77 35,533,846.86 31,789,528.69
Information relating to revenue:
Unit: RMB/CNY
Category Branch 1 Branch 2 Total
Product Types 41,446,631.12 2,454,621.20 43,901,252.32
101
Including:
Main business income 41,446,631.12 96,422.69 41,543,053.81
Other business income 2,358,198.51 2,358,198.51
Classification by
business area
Including:
Market or customer
type
Including:
Contract Types
Including:
Classification by time
of goods transfer
Including:
Classification by
contract duration
Including:
Classification by sales
channel
Including:
Total 41,446,631.12 2,454,621.20 43,901,252.32
Information relating to performance obligations:
There are no outstanding performance obligations
Information related to the transaction price allocated to the remaining performance obligations:
At the end of the reporting period, the amount of revenue corresponding to the performance obligations that have been signed but not
yet performed or not yet completed is 0.00 yuan, of which, yuan is expected to be recognized as revenue in , yuan is expected to be
recognized as revenue in , and yuan is expected to be recognized as revenue in .
5. Investment income
Unit: RMB/CNY
Item Current Period Last Period
Investment income of trading financial assets
1,076,034.24 49,972.60
during the holding period
Total 1,076,034.24 49,972.60
102
XVII. Supplementary Information
1. Current non-recurring gains/losses
√Applicable □Not applicable
Unit: RMB/CNY
Item Amount Note
Gains and losses on disposal of non-
5,105,581.41
current assets
Governmental subsidy reckoned into
current gains/losses (except for those
with normal operation business
concerned, and conform to the national
688,100.25
policies & regulations and are
continuously enjoyed at a fixed or
quantitative basis according to certain
standards)
Except for the effective hedging
operations related to normal business
operation of the Company, the
gains/losses of fair value changes from
holding the trading financial assets and 980,034.24
trading financial liabilities, and the
investment earnings obtained from
disposing the trading financial asset,
trading financial liability
Other non-operating income and
expenditure except for the 35,663.10
aforementioned items
Less: Impact on income tax 164,765.20
Impact on minority interests 146,469.38
Total 6,498,144.42 --
Details of other gains/losses items that meets the definition of non-recurring gains/losses:
□ Applicable √ Not applicable
There are no other gains/losses items that meet the definition of non-recurring gains/losses in the Company.
Explain the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss
in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --
- Extraordinary Profit/loss
□ Applicable √ Not applicable
2. REO and earnings per share
Earnings per share
Profits during report period Weighted average ROE Diluted EPS
Basic EPS (RMB/Share)
(RMB/Share)
Net profits attributable to common
-0.96% -0.03 -0.03
stock stockholders of the Company
Net profits attributable to common
-1.52% -0.05 -0.05
stock stockholders of the Company
103
after deducting nonrecurring gains
and losses
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable √Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable √Not applicable
104
