2020 Annual Report of Songcheng Performance Development Co., Ltd
Songcheng Performance Development Co., Ltd
2020 Annual Report
April 2021
1
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section I Important Notes, Contents And Definitions
The Board of Directors, the Board of Supervisors, directors, supervisors and senior management members of the Company
hereby guarantee that the information presented in this annual report is authentic, accurate, complete and free of any false records,
misleading statements or material omissions, and they will bear liabilities regarding this report.
Zhang Xian, Chief Executive Officer (CEO), Chen Shengmin, chief accountant, and Zhu Shana, head of accounting department
(Accounting Officer) hereby declare and warrant that the financial statements in the annual report are authentic, accurate, a nd
complete.
All directors attended the meeting of the Board of Directors for deliberation of this annual report.
There are specific reasons for the sharp decline in the Company’s performance during the reporting period. Risk factors that
may exist in the production and operation of the Company and countermeasures, have been detailed in the sections "I. Overview "
and "IX. Prospects for Future Development of the Company" of Section IV "Discussion and Analysis on Business Situation" of this
report. Investors should be mindful to investment risks.
The content concerning the future plan and performance forecast, if any, in this report shall not constitute the Company's
commitment to investors and relevant persons. Investors should maintain adequate risk awareness and must understand the
differences between the plans, forecasts and commitments.
1. Risks of Natural Factors and Social Factors
The natural and social factors such as major natural disasters, public health emergencies and large social activities will affect
the number of tourists received. The outbreak of COVID-19 in 2020 was a global public health event, which resulted in stagnation of
tourist and cultural consumption on the site, thereby affecting the business performances of the Company. The Company may
diffuse such risks through its strategic layout, but such periodical and local risk factors are generally irresistib le once they occur.
2. Risks of Macroeconomic Fluctuation
In 2020, COVID-19 epidemic swept the world, and accelerated the change of the world political and economic situation unseen
in a century. This presented the risk of change and anxiety to China's economy which was in and will remain in an important period
of strategic transformation and development for an extended period. The complicated and changeable domestic and international
macroeconomic environments may affect the level of national income and further, the consumer demands, thereby affecting the
operating performance of the Company.
3. Competition Risks
The competition risks include those from the same industry and those from the substitutes. The current high -quality
development of China's economy and the increasing cultural consumption demands from the general public drive the rapid
development of the live performance industry, particularly the tourist performance. Seeing the enormous business opportunitie s, a
large amount of social capital swarmed into the tourist performance industry. This, on the one hand, promotes the development of
the entire live performance industry, but on the other hand, inevitably intensifies the industry competition and affects the
operation of the Company. Meanwhile, the performance industry in the first-tier cities has developed to a certain level, presenting a
small but scattered development pattern. The Company, starting as a newcomer and integrator, shall undergo market adjustment
and adaptation at the initial stage.
With continuous technological progress, people have more choices for their cultural consumption from the emerging market of
digital cultural consumption such as short videos, movies, games, TV shows, live broadcasts and VR/AR. Despite the irreplacea ble
2
2020 Annual Report of Songcheng Performance Development Co., Ltd
role of live experience, digital entertainment will attract some tourists and impact the live experience to a certain extent, affecting
the operation of the Company.
4. Risks in Safety Accidents
Live performances being a key component in the Company’s operation, may be occasionally hindered by safety accidents.
Personal safety of visitors remains a major importance to the reputation of the Company.
The profit distribution proposal approved by the Board of Directors is: Taking 2,614,694,040 as the basis, RMB 0.5 (tax included)
of cash dividend and 0 bonus share (tax included) for every 10 shares will be distributed to all shareholders, and 0 share ca pitalized
from the capital reserves will be distributed to all the shareholders for every 10 shares.
Note:
This document is a translated version of the Chinese version 2020 Annual Report ( “2020 年年度报告”), and the published annual
report in the Chinese version shall prevail. The complete published Chinese 2020 Annual Report may be obtained at
www.cninfo.com.cn.
3
2020 Annual Report of Songcheng Performance Development Co., Ltd
Table of Contents
Section I Important Notes, Contents And Definitions .......................................................................................................................2
Section II Company Profile and Key Financial Indicators ...................................................................................................................7
Section III Corporate Business Overview ........................................................................................................................................ 12
Section IV Discussion and Analysis on Business Circumstance ........................................................................................................ 15
Section V Significant Events........................................................................................................................................................... 39
Section VI Changes in Shares and Information about Shareholders................................................................................................. 62
Section VII Information of Preferred Shares ................................................................................................................................... 70
Section VIII Convertible Corporate Bonds ...................................................................................................................................... 71
Section IX Directors, Supervisors, Senior Managers and Employees ................................................................................................ 72
Section X Corporate Governance ................................................................................................................................................... 80
Section XI Corporate Bonds........................................................................................................................................................... 87
Section XII Financial Report........................................................................................................................................................... 88
Section XIII Documents Available for Reference ........................................................................................................................... 254
4
2020 Annual Report of Songcheng Performance Development Co., Ltd
Definitions
Refers
Item Definitions
To
Company, the Company, Refers
Songcheng Performance Development Co., Ltd
Songcheng Performance To
Refers
Songcheng Holdings Hangzhou Songcheng Group Holdings Co., Ltd, the controlling shareholder of the Company
To
Songcheng Performance Refers Hangzhou Songcheng performance Valley technology and Culture Development Co., Ltd, a
Valley Company To wholly-owned subsidiary of the Company
Refers
Hangzhou Paradise Company Hangzhou Paradise Co., Ltd, a wholly-owned subsidiary of the Company
To
Refers
Songcheng Art Troupe Songcheng Performance Management Co., Ltd, a wholly-owned subsidiary of the Company
To
Refers
Songcheng Tourism Songcheng Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company
To
Sanya Romance Show Refers
Sanya Romance Tourism Performance Co., Ltd, a wholly-owned subsidiary of the Company
Company To
Lijiang Chama Ancient City Refers Lijiang Chama Ancient City Tourism Development Co., Ltd, a wholly-owned subsidiary of the
Company To Company
Jiuzhai Romance Show Refers Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd, a wholly-owned subsidiary of the
Company To Company
Refers Shanghai Songcheng World Expo Performance Development Co., Ltd, a holding subsidiary of
Shanghai Songcheng Company
To the Company
Guilin Romance Show Refers Guilin Lijiang Romance Performance Development Co., Ltd, a holding subsidiary of the
Company To Company
Zhangjiajie Romance Show Refers Zhangjiajie Romance Performance Development Co., Ltd, a wholly-owned subsidiary of the
Company To Company
Xi'an Romance Show Refers
Xi'an Romance Performance Development Co., Ltd, a holding subsidiary of the Company
Company To
Foshan Romance Show Refers Foshan South Sea Qiao Mountain Cultural Tourism Development Co., Ltd, a wholly-owned
Company To subsidiary of the Company
Xitang Songcheng Refers Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd, a
Performance Valley Company To wholly-owned subsidiary of the Company
Zhuhai Songcheng Company Refers Zhuhai Songcheng Performance Kingdom Co., Ltd, a wholly-owned subsidiary of the
5
2020 Annual Report of Songcheng Performance Development Co., Ltd
To Company
Refers Songcheng Performance International Development Co., Ltd, a wholly-owned subsidiary of
Songcheng International
To the Company
Refers Hangzhou Songcheng Technology Development Co., Ltd, a wholly-owned subsidiary of the
Songcheng Technology
To Company
Refers Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd, a wholly-owned subsidiary of
Dumuqiao Travel Agency
To Songcheng Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company
Songcheng (Australia) Entertainment Pty Ltd., a wholly-owned subsidiary of Songcheng
Songcheng Entertainment Refers
Performance International Development Co., Ltd, a wholly-owned subsidiary of the
Company (Australia) To
Company
Jiuzhai Tibetan Mystery Refers
Jiuzhaigou Tibetan Mystery Culture Co., Ltd, a holding subsidiary of the Company
Company To
Refers
Huafang Technology Beijing Huafang Technology Co., Ltd, a joint stock company of the Company
To
China Securities Regulatory Refers
China Securities Regulatory Commission
Commission (CSRC) To
Shenzhen Stock Exchange Refers
Shenzhen Stock Exchange
(SZSE) To
Refers
yuan, ten thousand yuan RMB, RMB Ten Thousand
To
6
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section II Company Profile and Key Financial Indicators
I. Company Information
Stock Abbreviation Songcheng Performance Stock Code 300144
Company Name in Chinese 宋城演艺发展股份有限公司
Company Abbreviation in Chinese 宋城演艺
Company Name in Foreign Language (If
Songcheng Performance Development Co., Ltd
any)
Abbreviation of Company Name in Foreign
Songcheng Performance
Language (If any)
Legal Representative Zhang Xian
Registered Address 148 Zhijiang Road, Hangzhou City, Zhejiang Province
Post Code of Registered Address 310008
Office Address 148 Zhijiang Road, Hangzhou City, Zhejiang Province
Post Code of Office Address 310008
Internet Website of the Company https://www.songcn.com/Shares/
E-mail zqb@chinascyy.com
II. Contact Person and Contact Information
Secretary of the Board Representative of Securities Affairs
Name Hou Li Hou Li
Contact Address 148 Zhijiang Road, Hangzhou City, Zhejiang Province 148 Zhijiang Road, Hangzhou City, Zhejiang Province
Tel. 0571-87091255 0571-87091255
Fax 0571-87091233 0571-87091233
E-mail hl@songcn.com hl@songcn.com
III. Information Disclosure and Location
The Media Selected by the Company for Disclosure Securities Times, Securities Daily
Website Designated by CSRC for Publishing Annual Report http://www.cninfo.com.cn
Location for Annual Report of the Company Securities Investment Department of the Company
7
2020 Annual Report of Songcheng Performance Development Co., Ltd
IV. Other Related Information
Accounting Firm Hired by the Company
Name of the Accounting Firm BDO China Shu Lun Pan CPAs (special general partnership)
Office Address of the Accounting Firm No. 61 Nanjing East Road, Shanghai
Name of Certified Public Accountant Ni Yilin, Jiang Xuelian
The sponsor institution hired by the company to perform the continuous supervision in the reporting period
□ Applicable √ Not applicable
The financial adviser hired by the company to perform the continuous supervision in the reporting period
□ Applicable √ Not applicable
V. Key Accounting Data and Financial Indicators
Whether the Company needs performed retroactive adjustment or restatement of accounting data in prior years or not
□ Yes √ No
Increase/decrease compared with
2020 2019 2018
previous year
Operating income (RMB) 902,586,125.63 2,611,753,208.86 -65.44% 3,211,192,814.48
Net profit attributable to
shareholders of the listed Company -1,752,398,009.60 1,339,790,994.94 -230.80% 1,287,186,547.41
(RMB)
Net profit attributable to
shareholders of the listed company
-1,767,861,638.68 1,222,100,617.31 -244.66% 1,279,733,108.31
after deducting non-recurring gains
and losses (RMB)
Net cash flow generated by
393,941,899.94 1,571,451,499.51 -74.93% 1,647,243,748.01
operational activities (RMB)
Basic Earnings per Share
-0.6702 0.5124 -230.80% 0.8861
(RMB/Share)
Diluted Earnings per Share
-0.6702 0.5124 -230.80% 0.8861
(RMB/Share)
Weighted Average ROE -20.50% 14.52% -35.02% 16.38%
Increase/Decrease at the end of
End of 2020 End of 2019 the current year compared with the End of 2018
end of the previous year
Total assets (RMB) 9,195,342,831.06 11,041,076,933.58 -16.72% 10,817,160,458.62
Net assets attributable to
shareholders of the listed company 7,412,287,432.06 9,614,069,166.64 -22.90% 8,471,075,013.49
(RMB)
8
2020 Annual Report of Songcheng Performance Development Co., Ltd
The lower of the Company's net profit before and after deduction of non-recurring profit and loss for the last three fiscal years is
negative, and the audit report for the latest year shows that there is uncertainty about the Company's ability to continue operating
□ Yes √ No
The lower of net profit before and after deduction of non-recurring profit and loss is negative
√ Yes □ No
Item 2020 2019 Notes
Operating income (RMB) 902,586,125.63 / Total Operating Income
Amount deducted from operating income Income from personnel dispatch management and other
6,381,032.95 /
(RMB) miscellaneous businesses
Amount of operating income after
896,205,092.68 / Operating income of main business
deduction (RMB)
Total share capital of the Company as at the trading date preceding the disclosure:
Total share capital of the Company as at the trading date
2,614,694,040
preceding the disclosure (share)
Whether the share capital has been changed for issuance of new shares, addition, allotment, exercise of equity incentives and
buy-back, and whether the amount of the owners' equity is influenced from the end of the reporting period of the Company to the
disclosure date of the annual report
□ Yes √ No
Preferred stock dividends paid 0.00
Fully diluted earnings per share calculated with the latest
-0.6702
share capital (RMB/share)
VI. Key Financial Indicators by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating income 134,352,197.80 148,522,407.15 335,646,114.92 284,065,405.76
Net profit attributable to -1,886,149,806.07
49,960,280.55 -10,112,011.86 93,903,527.78
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
18,467,729.86 1,512,334.57 91,357,882.55 -1,879,199,585.66
after deducting non-recurring gains
and losses
Net cash flow generated by
-20,444,426.81 -103,304,029.48 282,447,994.96 235,242,361.27
operating activities
Whether the above financial indicators or their totals are significantly different from the financial indicators disclosed in the
Company’s quarterly and semi-annual reports
□ Yes √ No
9
2020 Annual Report of Songcheng Performance Development Co., Ltd
VII. Differences in Accounting Data Under Domestic and Foreign Accounting Standards
1. Differences of net profits and net assets in the financial reports disclosed according to the international
accounting standards and Chinese accounting standards
□ Applicable √ Not applicable
During the reporting period of the company, there is no difference between the net profits and net assets in the financial re ports
disclosed according to international accounting standards and Chinese accounting standards.
(2) Differences between the net profits and net assets in the financial reports disclosed according to the
overseas accounting standards and Chinese accounting standards
□ Applicable √ Not applicable
During the reporting period of the company, there is no difference between the net profits and net assets in the financial re ports
disclosed according to overseas accounting standards and Chinese accounting standards.
3. Reasons for differences in accounting data under domestic and overseas accounting standards
□ Applicable √ Not applicable
VIII. Non-recurring Gains and Losses Items and Their Amounts
√ Applicable □ Not applicable
Unit: RMB
Item Amount in 2020 Amount in 2019 Amount in 2018 Note
Profits or losses from disposal of
non-current assets (including the write-off -37,625,882.13 70,970,952.64 -30,333,257.21
for the accrued impairment of assets)
The government subsidies included in the
current profits and losses (excluding the
government subsidies closely related to
35,618,594.19 5,629,978.38 12,326,627.98
regular businesses of the Company and
issued in the quota or quantity based on the
national standards)
Gains or losses from investment or asset
25,795,007.28
management entrusted to others
Profits and losses resulting from the
changes in fair value for holding trading
financial assets, derivative financial assets
and trading financial liabilities, derivative 19,619,586.83 52,061,383.80 21,276,486.89
financial liabilities and investment income
from disposal of trading financial assets,
derivative financial assets, trading financial
10
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item Amount in 2020 Amount in 2019 Amount in 2018 Note
liabilities, derivative financial liabilities, and
other obligatory right investment, excluding
the effective hedging businesses related to
the regular business operation of the
Company
Non-Operating Revenue and expenses other
-509,618.20 -19,029,327.85 -21,969,795.85
than the above
Less: Impact of income tax 2,230,795.39 -7,184,125.78 556,654.96
Impact of minority equity (after tax) -591,743.78 -873,264.88 -915,024.97
Total 15,463,629.08 117,690,377.63 7,453,439.10 --
For items defined as non-recurring gains and losses according to the No. 1 Explanatory Announcement on Information Disclosure
for Companies Offering Their Securities to Public - Non-recurring Gains and Losses, or non-recurring gains and losses items listed in
the said document defined as recurring ones, please specify the reasons.
□ Applicable √ Not applicable
In the reporting period, the Company did not define any non-recurring gains and losses items defined and listed in the No. 1
Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to Public - Non-recurring Gains and
Losses, as recurring gains and losses items.
11
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section III Corporate Business Overview
I. The Principal Business of the Company during the Reporting Period
1. Vision and mission
The Company upholds the philosophy of "a drop of water in need, shall be returned with a spring in deed", to provide
customers with warm on-site entertainment experiences. It is dedicated to telling global stories of Chinese culture, promoting
confidence of the nation, and striving to become the world's premier company in cultural performing arts.
2. Main business and products
During the reporting period, the Company was mainly engaged in cultural performance business. On -site performance and
tourism and recreation are the Company's main businesses.
Live performance is the Company's core business and main source of incomes and profits. Based on the Company's two
major brands of "Songcheng" and "Romantic Show", the original business mode of "theme park + cultural performance" provides
customers with theme park amusement and a variety of shows. Business income mainly comes from sales of tickets. Projects under
operation include "Romantic Show of Songcheng", "Romantic Show of Sanya", "Romantic Show of Lijiang", "Romantic Show of
Jiuzhai", "Romantic Show of Guilin", "Romantic Show of Zhangjiajie", and "Romantic Show of Xi'an". The So ngcheng project in
Shanghai will be unveiled on April 29, 2021, and projects under construction in Foshan, Xitang, and Zhuhai will also be intro duced to
the market.
Tourism and recreation mainly refer to light-asset output business and online sales of tickets. Based on the Company's
business capabilities and brand accumulation over the years, the light-asset output business provides partners with brand
authorization, planning and design, director and creation, entrusted operation and other services, and realizes business income by a
package of service fees and entrusted operation management fees. The light-asset output projects in operation include "Romantic
Show of Tanhe", "Romantic Show of Mingyue (Moon)" and "Romantic Show of Huangdi (Yellow Emperor)". On line sales of tickets
refer to online direct sales and distribution of tickets of performances and projects operated by the Company, and sales of j oint
tickets and ticket packages with third-party tourist attractions.
II. Material Changes to Major Assets
1. Major changes in main assets
Major Assets Explanation Of Material Changes
At the end of the reporting period, the long-term equity investment decreased by RMB 1,934,056,500 compared
Equity assets with the beginning of the period, which was mainly due to the impairment of the long-term equity investment of
Huafang Technology held by the Company during the reporting period.
By the end of the reporting period, the fixed assets increased by RMB 197,503,700 compared with the beginning
Fixed Assets of the period, which was mainly due to conversion of the Company's projects in construction to fixed assets
during the reporting period.
At the end of the reporting period, the intangible assets increased by RMB 381,541,800 compared with the
Intangible
beginning of the period, mainly due to the acquisition of land use rights by Zhuhai Songcheng Performance
Assets
Kingdom during the reporting period.
12
2020 Annual Report of Songcheng Performance Development Co., Ltd
By the end of the reporting period, projects in construction increased by RMB 401,871,300 compared with the
Projects under
beginning of the period, which was mainly due to the increased investment in construction by the Company
Construction
during the reporting period.
2. Major overseas assets
√ Applicable □ Not applicable
Control Proportion of
Incom Significant
Details of the Operation Measures to Foreign Assets in
Causes Asset Size Location e Risk of
Assets Mode Ensure Asset Company's Net
Status Impairment
Safety Assets
Theme
448,900 Gold Coast,
park + Art Suspe
Land Purchase square Queensland, 3.80% No
performanc nded
meters Australia
e
Other
N/A
Information
III. Core Competitiveness Analysis
Through continuous efforts, the Company has established a nationwide chain operation, with more than 40 million regular
audiences per year. Our market share ranks among the top and continues to increase, with rising efficiency in resource allocation
and brand influence. As a leading enterprise in China's performing arts industry, the Company's core competitiveness is mainl y
reflected in the following aspects:
1. Advantages of business mode
Centering on performing arts in theme parks with creativity, the Company is different from traditional companies in
performing arts and tourism. The business mode of "theme park + cultural performance" helps solve high performance costs, high
traffic attraction costs, and low frequency of audience replacement faced by common performing arts enterprises without
self-owned venues. For the tourism industry, the mode has overcome shortcomings of insufficient core competitiveness, poor
reproducibility, excessive reliance on large-scale and costly amusement equipment, low marginal effect, homogeneous services, and
weak profitability experienced by more traditional enterprises. From the Romantic Show model of "one show, one park", the
Company is transforming to the performing arts kingdom of "multiple theaters, shows, activities, and tickets", a move to expa nd its
business content by enriching the performing art experience for stronger competitiveness.
2. Advantages in creation and design
The Company has an experienced, professional and independent team in planning, design, creation and performance. In the
planning and design of theme parks and creation of performance products, team members can fully i ntegrate their own innovative
ideas through a deep understanding of local culture. During operation, new elements can be included in a timely manner according
to changes in the industry and the market. Simultaneously, inspiration and creativity are encouraged to constantly upgrade products
and services for better tourist experiences. The advantages in creation and design are an important guarantee for the Company to
advance through exciting innovation and breakthroughs.
3. Professional advantages
After years of development in the performing arts industry, the Company has accumulated and trained a large number of
professional talents, and established a standardized operation and management system, with a strong understanding of
13
2020 Annual Report of Songcheng Performance Development Co., Ltd
development laws and features of the industry. The Company has become highly skilled in project site selection, investment control,
performing arts creativity and design, stage presentation, costume props, scenic spot operation, viewing experience, and daily
management.
4. Marketing advantages
As internet, mobile internet, and new media are on the rise, the Company took advantage of its creative capabilities, and
conducted online and offline creative marketing. Topics were made to promote spontaneous media dissemination to realize
low-cost coverage of consumers, therefore providing market expansion and income growth in the process. In a time when
Generation Z has gradually become the main consumer force, the Company's flexible marketing strategies ensure s target groups to
be covered through online short videos, in-depth offline promotion and on-site activities.
5. Advantages in on-site experience
Internet and mobile internet have changed the business models of many traditional industries, and have brought a number
of existing industries considerable impacts and challenges. However, they cannot replace the enrichment gained through on-site
experience and participation to meet people's spiritual and cultural needs at higher levels. In an era with changing technolo gical
innovation, the Company's advantages in outstanding on-site experiences are becoming more obvious.
6. Closed-loop advantages
The Company has closed-loop teams covering the entire industry chain from site selection, planning and design, investment
and construction, direction and creation, opening planning, operation management, continuous improvement, event planning,
ticket price system setting, and marketing. The closed-loop coverage of the entire industry chain contributes in controlling costs,
improving efficiency, and enhancing profitability of the Company.
7. Platform advantages
Thanks to continuous development and expansion, the Company has a leading position in the number of projects, theaters
and seats, performances, and audiences. It has initially established a cultural performance platform covering first-tier tourism and
leisure destinations and urban clusters across the country. The large scale and huge tourist base will help the Company expand its
business boundaries, reduce marginal costs, improve operational efficiency, enhance brand influence and create performance
products with brand and its exclusive and innovative features.
8. Brand advantages
As the largest performing arts group in China, Songcheng Performance's "Songcheng" and "Romantic Show" have become
representative brands in live performing arts and creative industries. Our good market reputation and strong brand influence have
benefited the Company in project expansion, resource control, talent attraction, and market development.
9. Advantages in locations
The Company took the lead in businesses in important cities and first-tier tourism and leisure destinations in the country, and
has advantages in locations. As urban performing arts continue to advance, the Company will gradually move into mega and larg e
cities, and continue to strengthen and consolidate its position.
14
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section IV Discussion and Analysis on Business Circumstance
I. Overview
2020 is an extraordinary year in the history of the world, a year of ups and downs. The spread of COVID-19 in more than 199
countries and regions has taken a toll on human life safety and global economic development, and significantly raised the ris k of
economic recession and uncertainties through out the world. The disrupted supply chains, shrinking consumption and investment
demand, weakened economic activities, and impaired market confidence have brought unprecedented challenges to the resilience
and governance of countries and economic entities. The year of 2020 is also full of critical challenges for the cultural and travel
industry. The industry was in a standstill the first half of the year yet managed to recover in the second half of the year when the
epidemic receded. The road was a bumpy one, yet in recovery, new opportunities arose.
As the last year for China to build a moderately prosperous society in an all-round way and the "13th Five-Year Plan", 2020 is a
historical transition period from the "13th Five-Year Plan" to the "14th Five-Year Plan". It is also a time for China to strive for
high-quality economic development with an optimized industrial structure by weighing the modern service industry more. To
answer the strategic call for high-quality development, the cultural and tourist industries have entered a new stage for better quality,
efficiency, and will become the new powerhouse for further economic growth.
During the reporting period, the Company's scenic spots suspended operations from January 24, 2020, and resumed
operations on June 12, 2020. The Company has fully prepared itself to turn crises into opportunities through well balanced
epidemic controls and strong corporate oversight. With effective epidemic prevention in place, the Company has optimized and
upgraded the hardware, software, marketing, and organizational structure during park closure. Meanwhile, improvement of various
projects was also implemented. Hangzhou Songcheng, as a test field, was rebuilt into a new Hangzhou Songcheng Performing
Kingdom. The mode of "one show, one park, one ticket" was transformed and upgraded to a performing arts platform with multiple
shows and combination of a variety of tickets. Since resumption of business, the Company has been fully prepared to actively
promote its market recovery of tourists and revenue through online new media, short videos, offline promotion, special markets
and activities and other marketing methods. In terms of new projects, Xi'an and the light-asset project in Zhengzhou successfully
presented first shows, projects in Shanghai, Foshan, and Xitang were progressing, the Zhuhai project started construction, and the
contracgt for the light-asset project in Yan'an project was signed, providing significant momentum for the Company's future growth.
During the reporting period, the Company achieved operating income of RMB 902,586,10 0, a year-on-year decrease of 65.44%;
net profit attributable to shareholders of the listed company was -1,752,398,000, a year-on-year decrease of 230.80%; net profit
attributable to shareholders of the listed company after deducting non-recurring profit and loss was -1,767,861,600 yuan, a
year-on-year decrease of 244.66%.
Excluding the financial data of the digital entertainment platform and the increase or decrease in the long-term equity
investment of Huafang Technology, the Company's pro forma profit statement is as follows:
During the reporting period, the Company achieved operating income of RMB 902,586,100, a year-on-year decrease of 59.50%;
net profit attributable to shareholders of the listed company was 113,724,700 yuan, a year-on-year decrease of 89.11%; net profit
attributable to shareholders of the listed company after deducting non-recurring profit and loss was 98,261,100 yuan, a
year-on-year decrease of 90.86%.
The key tasks carried out by the Company during the reporting period are as follows:
15
2020 Annual Report of Songcheng Performance Development Co., Ltd
(I) Hardware expansion
1. Increase the type and number of theaters
With Hangzhou Songcheng as a model, the Company deeply explored existing resources of scenic spots to introduce different
types of indoor and outdoor performance venues with varied experiences. It built upgraded standard theaters, walk-around
theaters, cliff theaters, forest theaters, floating theater and other new theaters, delivering new and extraordinary experiences to its
guests.No. 2 and No.3 Romantic Show Theater is an upgraded version of the Company's standard theaters. The combination of the
cliff theater and elegant music, and the forest theater and popular fashion provide visitors with more choices. During the reporting
period, 10 indoor and outdoor theaters and more than 10,000 seats were added in the Hangzhou Songcheng scenic spot during
business suspension in response to the epidemic. No.2 and other types of theaters were added to existing or new projects to
further expand the capacity. The continuous increase in the number of theaters and seats is conducive to diversified performa nces,
larger reception capacity, and better tourist experiences. It also makes it possible in hardware to provide products, content, and
tickets on many different levels.
2. Extend touring routes
Taking Sanya as an example, the original touring route was only a few hundred meters long. With diversion and aggregation,
the route length was extended by 3 to 4 times by combining underutilized space. Another example is the restructuring of Hangzhou
Songcheng. Without expanding the area, the play route was redesigned, and indoor and outdoor small theaters, and interactive
spaces were added with a series of new performances. These measures have improved the tourist experience and effectively
extended park visitor duration.
3. New popular sites
The Generation Z loves recommending and sharing. Growing up in the internet era, their consumption is trendier and more
individual. To meet the needs of young people, the Company's scenic spots have created many popular sites, including "Glass
Skywalk", Setting of Marionette, Sky Tree, Setting of Ayue out of Bath, interactive amusement park of oiled paper umbrellas, love
like device, sound post office, and 3D printing wall. The introduction of the role play hall is also favored by young people, enhancing
their experience and atmosphere of the scenic spot.
4. Improved supporting facilities
Supporting facilities were further improved in scenic spots. Landscape design and presentation were enhanced with more large
entrance halls and rest areas. While increasing the proportion of self-operated businesses, the Company will continue to build
all-weather, comfortable, convenient and safe scenic spots for all. Hangzhou Songcheng for example, two newly built large food
courts can accommodate 1,500 people at the same time, bringing a variety of deli cious foods to meet guests expectations. At the
same time, the proportion of self-operated shops was also expanded in projects in other parks to upgrade product types, quality
control, and hardware.
(II) Content upgrade
With continuous expansion of our commercial landscape, the Company, centering on "Romantic Show" and supplemented by
"Love in" and "Color" series, has gradually formed a content matrix in outfield performances, cooperation, customization,
introduction, and procurement of shows.
1. "Romantic Show" series
Led by the chief director under the new organizational structure and creation mode l, the Company's art team work hard with
an innovative spirit. Romantic Show of Xi'an and Romantic Show of Huangdi have opened, and Romantic Show of Shanghai and
16
2020 Annual Report of Songcheng Performance Development Co., Ltd
Romantic Show of Foshan are proceeding in an orderly manner. During the reporting period, "Romantic Show of Xi'an and Romanti c
Show of Huangdi have opened. The Company expanded operation in northern areas, with rising market and brand value and a
consolidated position as China's top performing arts brand and industry leader.
2. "Love in" and "Color" series
Currently, the Company is stepping up preparations for the "Love in" and "Color" series. The "Love in" series focuses on the
original ecological folk culture to present local customs; the "Color" series is a boutique performing arts for tourists, whi ch is a grand
interactive show filled with fashion, culture, technology, light and shadow, dreams, surprises, suspense, and elements favored by
young people. The Company has also enabled new and young director teams from the headquarters and affiliated art troupes on
these shows, cultivating a younger director team.
3. Indoor small and medium drama
In addition to the original 5D real-life drama "The Earthquake" and the holographic show "Phantom", the Company launched a
new parent-child show "Beware-Dinosaurs!", nostalgic drama "Katyusha", and walk-around performance "Shangganling" and
"'Ahoy' Captain Cook!" during the reporting period. These new performances greatly enhanced its performing arts portfolio.
4. Outdoor series
In terms of outfield performance, the Company has resumed the classic traditional dramas, including the martial arts drama
"Yanqing on Stage Contest" and the interactive drama "The Case of Chen Shimei", and added trendy content like cliff concerts,
forest and water concerts, and electronic music parties for tourists, providing tourists with more entertainment options.
(III) Marketing optimization
During the reporting period, the Company achieved excellent results in marketing through online short videos and new media,
offline field promotion and penetration into special markets.
1. Online
Build up new space in network communication and strengthen the diversified development of We media and short video
platforms. The Company has closely integrated brand promotion with marketing through content marketing, online gifts and
coupons, and offline diversion, to maintain continuous growth of its followers and increasing their retention rate. In addition,
employees were encouraged to post contents on Tik Tok to increase exposure of various scenic spots on network communication
platforms.
2. Offline
In recent years, consumption of young people in small towns is on the rise. In line with local conditions, the Company starte d
first round marketing in lower-level regions, especially towns contributing more customers. Flyers, wall paintings, and promotion
materials were used to effectively expose the brand to potential customers.
3. Activities
Since resumption of business, the Company has launched different seasonal and holiday themed activities according to various
festivals and timings such as surrounding tours, summer night tours, National Day, Halloween, Christmas Day and New Year's Day,
and Spring Festival. Different ticket prices and product combinations have been tested in the market, and subsequently, a diverse
price system for the it’s performing arts venues has been instituted.
17
2020 Annual Report of Songcheng Performance Development Co., Ltd
(IV) Optimized organizational structure
1. Optimizing vertical management
The Company's vertical management conducts all-around, refined and standardized management of performance quality,
equipment uses, safety, and scenic spot operation, and has instituted a regular meeting system. The management system has been
running effectively now for 3 years. With the rapid increase of projects, everything, from lighting, sound, dance, props,
management, to guest reception, must have strict oversight. Standards and vertical management can reduce levels to ensure
accuracy of management points.
2. Optimizing creation team
The continuous development of the Company and the epidemic prompted the optimization, adjustment and integration of the
creation team. The original direction and creation team cultivated from actors has limitation in overall quality, which affects the
speed and quality of product creation. During the reporting period, the Company adjusted the original team, some were transferred
to the management of the art troupe, and others remained in the creation team. At the same time, professional talents with
experiences in large-scale performances, and outstanding talents of Beijing Dance Academy and other colleges were absorbed. The
current staff structure as a result is more diverse and efficient.
3. Establishing an innovation department
The Company established the Innovation Department, which is mainly responsible for creation of popular conte nt on internet
and introduction of creative devices. The department shall introduce relevant fresh information within and beyond the industr y to
the Company in a timely manner, and add, supplement, and improve new business patterns, experience projects, an d landscape
atmosphere to various scenic spots. At the same time, it will collect information for tourism and urban performance potentials. The
department shall help solve the deficiencies of original internet applications and popular contents, and serve as the Company's
front runner to reach leading projects.
(V) Preparation of Shanghai project
The Shanghai project is located in the city's permanent green space Expo Park near Huangpu River. It combines elements of
Shanghai-style culture, old industrial base, and fashion vitality with an outstanding location, convenient transportation and good
supporting facilities. In the post-epidemic era, the Shanghai government has put forward a call to "build a performing arts center of
Asia". Firmly grasping this opportunity, the Company will spare no effort to create a “jewel” of performing arts in Shanghai.
After more than two years of construction, especially the in-depth development and model testing of the Performing Arts
Kingdom since the epidemic, the Shanghai project will open with rich program content.
Rooted in the magnificent history of Shanghai, the main show "Romantic Show of Shanghai" tells the great chapters of the city
with profound culture, passion, and high-tech international stage means. The performance is divided into chapters of "The Origin of
Shenhu", "1921", "Modern Years", "Shanghai Family", and "Wind from the Sea". On the stage, the audience will experience the
Songze archaeological site dating back 6000 years, Sir Chunshen's manor estate granted by the emperor in the Warring States
Period, the glorious history of 1st National Congress of CPC, the ups and downs of the Shili Yangchang in the 1920s and 1930s , the
grand atmosphere of the World Expo in the new century. On stage, the core culture of the 30-year development and opening of
Pudong is proudly presented. The vivid presentation of Shanghai’s red culture, Shanghai-style culture, and Jiangnan culture will
bring the audience a visual and spiritual feast.
At the same time, the Performing Park also launched 4 special performances for different groups with different styles, including
18
2020 Annual Report of Songcheng Performance Development Co., Ltd
hundreds of actors from more than ten countries. The High Show "Color" centers on the performing arts complex of Songcheng in
Shanghai, and sets up multiple performance spaces with different styles on each floor. Each performance space is uniquely set up
with an independent plot in movie-level scenes, which highly restores the real texture under different themes. Walking in the
performance space of "Color", the audience will encounter different characters and trigger different stories at every corner. As a
high-tech stage production, the parent-child show "Beware-Dinosaurs!" is a collision of art and science filled with knowledge. The
large-scale dinner show "Samba Passion" brings together top dancers from Argentina, Cuba, Russia, and Ukraine, presenting the
purest South American flavor and beat to the audience. The brilliant show "S" will bring an electric spark to all.
This venue is a brand new performance park designed to shock your imagination. "Battle of Shanghai", "The Earthquake",
"Ghost Ship", "Liaozhai Ghost House", "Storm Eye", naked-eye 3D and other large-scale interactive experience projects will impress
every tourist. It is like a world away while walking on Crossing Street, Magic Street, Market in Heaven, and Romantic Street; every
stop is a scene in the music square. There will also be “the colorful forest”, the “fairy valley”, the “sky city”, the glass platform and
the rattan bridge as splendid shows are staged every day at more than 20 theaters and performance venues, including the standard
theater, the bird show theater, the forest theater, and the cliff theater. As an open art district, Songcheng Downtown has multiple
variable spaces and a performance square that can accommodate tens of thousands of people, which is a comprehensive art
performance platform. The performance park welcomes people of all ages with daily shows and trendy activities each week.
Through customized hardware, diversified content creation and a circle-based pricing system, the Shanghai project will cover
the overall population and with precise penetration. With rich contents and different customer groups, the Shanghai project w ill
have a diversified ticket pricing system, including single tickets, a package ticket of Romantic Show, combined tickets, discounted
group tickets, children's tickets, and night party tickets.
(VI) Live broadcast platform
In recent years, the internet performance/digital entertainment industry has entered a stage of steady development with
intensified competition. The PC market continues to be eroded by the mobile market. During the reporting period, people stayed
more at home due to the epidemic. As a result, they spent more time on internet, bringing a new wave of benefits to digital
entertainment platforms; live broadcast technology empowered offline industries, live education, live consultation, and "Clou d
Concerts" , "Cloud Wedding" and "Cloud Recruitment" have emerged. These have integrated into all aspects of people's daily life. In
the current market environment, the digital entertainment industry faces both opportunities and challenges. During the report ing
period, the overall business of Huafang Technology developed well, with increasing paying users, con sumption users, operating
income and operating profit. In terms of segments, the performance of Six Rooms has shown fluctuation as it has entered the s tage
of business optimization and operation improvement; while Huajiao Live has shown a growth trend with a leading position in the
industry in terms of user usage time and penetration among active users.
(VII) Other
In 2020, the global outbreak of COVID-19 brought the cultural travel industry almost to a halt. During this period, the Company
did not stop in strategic development thinking and new project expansion, and conducted a comprehensive evaluation of existing
projects and businesses. Given that the main business of Zhejiang Songcheng Longquanshan Tourism Development Co., Ltd. is
different from the Company's future strategic development plan, the Company signed a contract with Longquan Tourism Investment
Development Co., Ltd. under the People's Government of Longquan, Zhejiang Province in April 2021 to transfer all the equity o f
Zhejiang Songcheng Longquanshan Tourism Development Co., Ltd. at a total consideration of 276 million yuan. The implementation
of this equity transfer is conducive to a stable operation transfer of Longquanshan project, and also helps the Company optim ize
capital, resource allocation and asset structure, and improve asset operation efficiency to focus on its main business.
19
2020 Annual Report of Songcheng Performance Development Co., Ltd
II. Main Business Analysis
1. Overview
See "I. Overview" in "Discussion and Analysis on Business Circumstance".
2. Income and Costs
(1) Operating income structure
Overall operating income
Unit: RMB
2020 2019
Year-on-year
Proportion in Proportion in
Amount Amount increase or decrease
Operating Revenue Operating Revenue
Total Revenue 902,586,125.63 100% 2,611,753,208.86 100% -65.44%
By Industry
I. Culture and Art
Industry - Live 675,872,865.35 74.88% 1,871,167,934.09 71.64% -63.88%
Performance
II. Culture and Art
Industry -
383,412,284.25 14.68% -100.00%
Performance on
Internet
III. Tourism Service
226,713,260.28 25.12% 357,172,990.52 13.68% -36.53%
Industry
By Product
1. Songcheng in
286,877,405.89 31.78% 918,884,614.29 35.18% -68.78%
Hangzhou
2. Songcheng in
127,098,246.23 14.08% 392,729,155.06 15.04% -67.64%
Sanya
3. Songcheng in
136,520,949.23 15.13% 333,433,832.57 12.77% -59.06%
Lijiang
4. Songcheng in
25,667,095.21 2.84%
Jiuzhai
5. Songcheng in
56,586,027.07 6.27% 160,649,726.51 6.15% -64.78%
Guilin
6. Songcheng in
18,120,963.58 2.01% 65,470,605.66 2.51% -72.32%
Zhangjiajie
7. Songcheng in 25,002,178.14 2.77%
20
2020 Annual Report of Songcheng Performance Development Co., Ltd
2020 2019
Year-on-year
Proportion in Proportion in
Amount Amount increase or decrease
Operating Revenue Operating Revenue
Xi'an
8. Digital
entertainment 383,412,284.25 14.68% -100.00%
platform
9. E-commerce
43,316,562.23 4.80% 180,426,687.71 6.91% -75.99%
service charge
10. Design and
183,396,698.05 20.32% 173,281,416.46 6.63% 5.84%
planning fees
11. Supporting
facilities and
transportation 3,464,886.35 0.13% -100.00%
services for scenic
spots
By Region
1. Zhejiang Province 513,590,666.17 56.90% 1,276,057,604.81 48.86% -59.75%
2. Sanya, Hainan
127,098,246.23 14.08% 392,729,155.06 15.04% -67.64%
Province
3. Lijiang, Yunnan
136,520,949.23 15.13% 333,433,832.57 12.77% -59.06%
Province
4. Sichuan Province 25,667,095.21 2.84%
5. Beijing 383,412,284.25 14.68% -100.00%
6. Guilin, Guangxi
56,586,027.07 6.27% 160,649,726.51 6.15% -64.78%
Province
7. Zhangjiajie, Hunan
18,120,963.58 2.01% 65,470,605.66 2.50% -72.32%
Province
8. Xi'an, Shaanxi
25,002,178.14 2.77%
Province
(2) Industry, product, or region accounting for more than 10% of the company's operating revenue or profit
√ Applicable □ Not applicable
Unit: RMB
21
2020 Annual Report of Songcheng Performance Development Co., Ltd
Increase or Increase and Increase or
decrease of decrease of decrease of gross
operating income operating cost profit compared
Operating income Operating Cost Gross margin
compared with over the same with the same
the same period period of last period of last
of last year year year
By Industry
I. Culture and Art
Industry - Live 675,872,865.35 341,549,955.68 49.47% -63.88% -28.09% -25.15%
Performance
II. Tourism
226,713,260.28 11,120,517.74 95.09% -36.53% -89.09% 23.64%
Service Industry
By Product
1. Songcheng in
286,877,405.89 186,752,833.49 34.90% -68.78% -35.30% -33.69%
Hangzhou
2. Songcheng in
127,098,246.23 29,293,691.27 76.95% -67.64% -50.29% -8.04%
Sanya
3. Songcheng in
136,520,949.23 34,341,329.43 74.85% -59.06% -42.14% -7.35%
Lijiang
4. Design and
183,396,698.05 8,113,082.55 95.58% 5.84% 100.08% -2.08%
planning fees
By Region
1. Zhejiang
513,590,666.17 197,873,351.23 61.47% -59.75% -49.34% -7.92%
Province
2. Sanya, Hainan
127,098,246.23 29,293,691.27 76.95% -67.64% -50.29% -8.04%
Province
3. Lijiang, Yunnan
136,520,949.23 34,341,329.43 74.85% -59.06% -42.14% -7.35%
Province
When the statistical caliber of the company's main business data is adjusted in the reporting period, the company's main busi ness
data should be subject to the one after the statistical caliber at the end of the reporting period is adjusted in the most recent year.
□ Applicable √ Not applicable
(3) Is the company's physical sales income greater than the labor income?
□ Yes √ No
(4) Performance of major sales contracts signed by the Company as of the reporting period
□ Applicable √ Not applicable
22
2020 Annual Report of Songcheng Performance Development Co., Ltd
(5) Operating Cost Structure
Industry Classification
Unit: RMB
2020 2019 Year-on-year
Industry
Item Proportion to Proportion to increase or
Classification Amount Amount
Operating Cost Operating Cost decrease
I. Culture and Art
Cost of live
Industry - Live 341,549,955.68 96.85% 474,975,419.72 63.57% -28.09%
performance
Performance
II. Culture and Art
Industry - Performance cost
170,265,034.42 22.79% -100.00%
Performance on on internet
Internet
III. Tourism Cost of tourism
11,120,517.74 3.15% 101,948,847.10 13.64% -89.09%
Service Industry service industry
Note
N/A
(6) Has the scope of consolidation changed during the reporting period?
√ Yes □ No
There are 5 newly merged units in this period, the reasons are:
New Merged Units This Year Investment Ratio Notes
Zhuhai Songcheng Performance Kingdom Co., Ltd 100% New in 2020
Zhuhai Southern Film and Television Cultural 100% Acquire 100% equity in 2020
Industry Co., Ltd.
Zhuhai Huayin Landscaping Co., Ltd. 55% 55% holding subsidiary affiliated
Zhuhai Southern Film and Television Cultural Industry
Co., Ltd. acquired in 2020
Songcheng Brand Management Co., Ltd. 100% New in 2020
Romance Show Management Co., Ltd. 100% New in 2020
In the current period, the number of merged units was reduced by 2 due to:
Reduced Merged Units This Year Investment Ratio Notes
Hangzhou Songcheng Art Troupe Co., Ltd. 100% Canceled in 2020
Zhejiang Songcheng Entertainment Culture Co., 100% Canceled in 2020
Ltd.
23
2020 Annual Report of Songcheng Performance Development Co., Ltd
(7) Major changes or adjustments to the company's business, products, or services during the reporting period
□ Applicable √ Not applicable
(8) Major Clients and Suppliers
The Company's Major Clients
Total sales amount of the top five customers 295,250,820.97
Proportion of the total sales amount of the top five
32.71%
customers to the total annual sales
Proportion of the total sales amount of the related
0.00%
parties in the top five customers to the total annual sales
Profiles of the Company's top five customers
No. Name of customer Sales amount (yuan) Proportion to the annual sales
1 Customer I 128,933,962.27 14.28%
2 Customer II 50,414,308.38 5.59%
3 Customer III 39,108,962.22 4.33%
4 Customer IV 38,845,104.50 4.31%
5 Customer V 37,948,483.60 4.20%
Total -- 295,250,820.97 32.71%
Other Information Notes for Major Clients
□ Applicable √ Not applicable
(8) Major suppliers
Total Purchase Amount of Top Five Suppliers (yuan) 397,247,387.85
Proportion of the total purchase amount of top five
34.73%
suppliers to the total annual purchase amount
Proportion of the total purchase amount of the related
parties in top five suppliers to the total annual purchase 0.00%
amount
Profiles of the Company's top five suppliers
Proportion to the total annual purchase
No. Supplier Name Purchase amount (yuan)
amount
1 Supplier I 147,103,879.82 12.86%
2 Supplier II 106,202,799.73 9.28%
3 Supplier III 57,800,000.00 5.05%
4 Supplier IV 49,683,318.00 4.34%
5 Supplier V 36,457,390.30 3.19%
24
2020 Annual Report of Songcheng Performance Development Co., Ltd
Total -- 397,247,387.85 34.73%
Other Information Notes for Major Suppliers
□ Applicable √ Not applicable
3. Expenses
Unit: RMB
Year-on-year
2020 2019 increase or Statement on Significant Changes
decrease
Mainly due to the impact of the
epidemic and Huafang Technology is
Sales Expenses 63,649,750.30 145,503,636.64 -56.26%
no longer included in the scope of
consolidation
Mainly due to the closure of various
scenic spots of the Company during
Administration expenses 288,084,167.74 188,215,121.23 53.06% the epidemic, and the adjustment of
operating costs during the closed
period to this item
Mainly due to the increase in bank
Financial Expenses -12,843,438.15 -17,743,898.84 27.62% loan interest and exchange gains and
losses
Mainly due to the fact that Huafang
Research and
37,487,964.00 48,424,520.54 -22.58% Technology is no longer included in the
development expense
scope of consolidation
4. R&D Investment
√ Applicable □ Not applicable
During the reporting period, the Company invested RMB 37,488,000 in research and development, mainly input in new
technologies to improve the stage effect, the background control system, the production of VR content, and upgrade of the ticketing
system. In the light of consistency and prudence, the Company's R&D investment is fully included in the current profit and loss
without capitalization.
The Company's R&D investment in the past three years and its percentage in operating income
2020 2019 2018
Number of R&D personnel 253 252 326
Percentage of R&D personnel 17.56% 17.37% 19.09%
R&D investment (yuan) 37,487,964.00 48,424,520.54 70,567,576.48
The proportion of R&D
4.15% 1.85% 2.20%
investment to operating income
25
2020 Annual Report of Songcheng Performance Development Co., Ltd
Capitalized amount of R&D
0.00 0.00 0.00
expenditure (yuan)
Percentage of capitalized R&D
0.00% 0.00% 0.00%
expenditure in R&D investment
Percentage of capitalized R&D
expenditure in current net 0.00% 0.00% 0.00%
profit
The reason for the significant change in the proportion of the total amount of R&D investment to operating income compared with
last year
□ Applicable √ Not applicable
Reasons and rational explanations on the substantial change in capitalization rate of R&D investment
□ Applicable √ Not applicable
5. Cash Flow
Unit: RMB
Year-on-year increase or
Item 2020 2019
decrease
Subtotal of cash inflow from
943,790,117.88 3,146,681,409.32 -70.01%
operational activities
Subtotal of cash outflow from
549,848,217.94 1,575,229,909.81 -65.09%
operational activities
Net cash flow generated by
393,941,899.94 1,571,451,499.51 -74.93%
operating activities
Subtotal of cash inflow from
1,351,939,517.27 1,939,481,747.40 -30.29%
investment activities
Subtotal of Cash Outflow from
2,292,941,086.10 3,120,852,903.60 -26.53%
Investment Activities
Net amount of cash flow
generated by investment -941,001,568.83 -1,181,371,156.20 20.35%
activities
Subtotal of cash inflow from
420,000,000.00 13,500,000.00 3,011.11%
financing activities
Subtotal of cash outflow from
306,917,837.81 174,312,936.00 76.07%
financing activities
Net cash flow generated by
113,082,162.19 -160,812,936.00 170.32%
financing activities
Net additions to balance of
-443,933,773.37 231,761,674.88 -291.55%
equivalents
Description of the main factors affecting the significant changes in related data over the same period of last year
26
2020 Annual Report of Songcheng Performance Development Co., Ltd
√ Applicable □ Not applicable
During the reporting period, the subtotals of cash inflows and outflows from operating activities, and the net cash flows fro m
operating activities decreased by 70.01%, 65.09%, and 74.93% respectively year-on-year, mainly due to the impact of the epidemic
and the fact that Huafang Technology is no longer incorporated into the scope of the Company's consolidation.
During the reporting period, the subtotals of cash inflow and outflow from investment activities decreased by 30.29% and
26.53% respectively year-on-year, mainly due to the year-on-year decrease in the Company's purchase and redemption of financial
products.
During the reporting period, the subtotal of cash inflow from financing activities increased by 3011.11% year-on-year, mainly
due to the increase in the Company's bank loans and the receipt of capital contributions from shareholders by Xi'an Romance S how
Company.
During the reporting period, the subtotal of cash outflows from financing activities increased by 76.07% year-on-year, mainly
due to the year-on-year increase in the Company's repayment of bank loans and dividend distribution.
Reasons for the significant difference between the net cash flow generated by the company's operating activities in the
reporting period and the net profit in the current year
√ Applicable □ Not applicable
Supplementary information Amount of this period
1. Reconciliation of net profit to cash flows from operational
activities:
Net Profit -1,766,945,878.00
Plus: Credit impairment loss 32,739,976.91
Provision for Impairment of Assets 1,877,720,155.72
Depreciation of fixed assets 201,385,250.67
Amortization of Intangible Assets 56,669,812.67
Amortization of long-term prepaid expenses 35,034,022.89
Losses on disposal of fixed assets, intangible assets and other -676,435.92
long-term assets (mark "-" for incomes)
Losses on scrapping of fixed assets (mark "-" for incomes) 38,302,318.05
Losses on fair value changes (mark "-" for incomes) -247,726.31
Financial expenses (mark "-" for incomes) 17,775,739.48
Losses on investment (mark "-" for incomes) -14,014,892.30
Decrease on deferred income tax assets (mark "-" for increases) -9,318,905.44
Increase on deferred income tax liabilities (mark "-" for -3,137,428.24
decreases)
Decrease on inventories (mark "-" for increases) -1,993,817.28
Decrease on operational receivables (mark "-" for increases) -44,275,900.28
Increase on operational payables (mark "-" for decreases) -25,074,392.68
Others
Net cash flow generated by operating activities 393,941,899.94
27
2020 Annual Report of Songcheng Performance Development Co., Ltd
III. Non-Core Business
√ Applicable □ Not applicable
Unit: RMB
Percentage of Total
Amount Reason Sustainability
Profit
Mainly due to long-term
equity investment and
Investment Income 14,014,892.30 -0.81% Yes
financial income calculated
by the equity method
Changes in fair
value gains and 247,726.31 -0.01% No
losses
Mainly due to the
impairment of the long-term
Asset Impairment -1,910,460,132.63 109.98% equity investment of No
Huafang Technology held by
the Company
Non-operating
3,242,377.14 -0.19% No
Revenue
Mainly due to the
Non-Operating
41,007,879.43 -2.36% Company's scenic upgrades No
Expenses
and renovations
IV. Analysis of Assets and Liabilities
1. Significant changes in assets composition
Since 2020, the Company implemented new revenue standards and new leasing standards for the first time, and adjusted the items
related to financial statements at the beginning of the year.
Applicable
Unit: RMB
End of 2020 Early 2020 Proportion
Statement on Significant
Proportion To Proportion To increase and
Amount Amount Changes
Total Assets Total Assets decrease
Cash and Bank
1,337,776,253.98 14.55% 1,785,124,821.87 16.17% -1.62%
Balances
Accounts
5,887,012.36 0.06% 5,337,855.43 0.05% 0.01%
receivable
Inventory 13,424,146.50 0.15% 6,110,221.56 0.06% 0.09%
28
2020 Annual Report of Songcheng Performance Development Co., Ltd
Mainly due to the impairment
Long-term of the long-term equity
Equity 1,534,539,625.11 16.69% 3,468,596,165.08 31.42% -14.73% investment of Huafang
Investment Technology held by the
Company
Mainly due to the transfer of
Fixed Assets 2,508,754,929.16 27.28% 2,311,251,277.89 20.93% 6.35% the Company's project in
construction into fixed assets
Mainly due to increased input in
Projects under
771,871,563.73 8.39% 370,000,233.10 3.35% 5.04% the Company's projects in
Construction
construction
Mainly due to increase in the
Long-term loan 282,000,000.00 3.07% 0.00% 3.07%
Company's bank loans
2. Assets and liabilities measured at fair value
√ Applicable □ Not applicable
Unit: RMB
Changes in
At the fair value Cumulative Impairment Purchase
Sales amount At the end of
beginning of gains and fair value loss of the amount of Other
Item of the reporting the reporting
the reporting losses in the changes in reporting the reporting variations
period period
period current equity period period
period
Financial Assets
1. Trading
financial
assets
(excluding 854,108,086.54 -4,999,569.16 814,776,184.30 1,354,628,734.60 19,371,860.52 328,627,827.60
derivative
financial
assets)
2. Derivative
financial 6,589,730.08 6,589,730.08
assets
3. Other
credit
investments
4.
Investment 300,959,931.64 -76,693,334.90 224,266,596.74
in other
29
2020 Annual Report of Songcheng Performance Development Co., Ltd
equity
instruments
Subtotal of
financial 1,155,068,018.18 1,590,160.92 -76,693,334.90 814,776,184.30 1,354,628,734.60 19,371,860.52 559,484,154.42
assets
Total 1,155,068,018.18 1,590,160.92 -76,693,334.90 814,776,184.30 1,354,628,734.60 19,371,860.52 559,484,154.42
Financial
0.00 0.00 0.00 0.00 0.00 0.00
liabilities
Note: ① Changes in fair value recognized in profit or loss for the current period are 1,590,160.92 yuan, which is composed of
changes in fair value recognized in profit or loss of 247,726.31 yuan and converted difference in foreign currency statements
of 1,342,434.61 yuan; ② Other changes are accumulated investment income.
Are there any significant changes in the measurement attributes of the company's main assets during the reporting period?
□ Yes √ No
3. Restrictions on asset rights as of the end of the reporting period
As of the end of the reporting period, the Company's main assets were not seized, frozen, mortgaged or pledged.
V. Investment analysis
1. Overview
√ Applicable □ Not applicable
Investment Over The Corresponding
Investment In The Reporting Period (RMB) Rate Of Change
Period Of Last Year
2,159,030,550.7 2,680,647,888.78 -19.46%
2. Significant equity investments acquired during the reporting period
√ Applicable □ Not applicable
Unit: RMB
Progress
Invested Current Involved Disclosing Disclosing
Main Investment Investment Shareholding Capital Investment Product as of Anticipated
Company Partner Investment in a Date (If Index (If
businesses Mode Amount Percentage Source Period type Balance Income
Name Profit and Loss Lawsuit Any) Any)
Sheet Date
Zhuhai Project
Southern development,
Film and operation and Film and
Equity
Television management Acquisition 378,000,000.00 100.00% N/A Long-term television Completed 0.00 -16,469,469.80 No
Fund
Cultural of film and culture
Industry television
Co., Ltd. industry;
30
2020 Annual Report of Songcheng Performance Development Co., Ltd
Progress
Invested Current Involved Disclosing Disclosing
Main Investment Investment Shareholding Capital Investment Product as of Anticipated
Company Partner Investment in a Date (If Index (If
businesses Mode Amount Percentage Source Period type Balance Income
Name Profit and Loss Lawsuit Any) Any)
Sheet Date
development,
operation and
management
of tourism
projects; real
estate
development;
business
services and
commercial
wholesale and
retail
Total -- -- 378,000,000.00 -- -- -- -- -- -- 0.00 -16,469,469.80 -- -- --
3. Major non-equity investments underway during the reporting period
□ Applicable √ Not applicable
4. Financial assets at fair value
√ Applicable □ Not applicable
Unit: RMB
Changes in fair Cumulative Amount
Initial Amount sold Cumulative Amount at the
value gains and fair value purchased during Capital
Asset Class Investment during the investment end of the
losses in the changes in the reporting Source
Cost reporting period income period
current period equity period
Temporarily
Fund 110,024,148.79 -538,080.75 103,776,184.30 40,362,625.24 -454,248.84 172,445,378.26 idle own
funds
Temporarily
Financial
6,589,730.08 6,589,730.08 idle own
Derivatives
funds
Other (Bank Temporarily
Financial 744,083,937.75 -4,461,488.41 711,000,000.00 1,314,266,109.36 19,826,109.36 156,182,449.34 idle own
Products) funds
Total 854,108,086.54 1,590,160.92 0.00 814,776,184.30 1,354,628,734.60 19,371,860.52 335,217,557.68 --
Note: The current fair value change in profit and loss in the table is 1,590,160.92 yuan, which is composed of the fair value change
in profit and loss of 247,726.31 yuan and the converted difference in foreign currency statements of 1,342,434.61 yuan.
31
2020 Annual Report of Songcheng Performance Development Co., Ltd
5. Utilization of raised funds
□ Applicable √ Not applicable
No use of funds in the reporting period of the Company
VI. Major Assets and Equity Sales
1. Major assets sales
□ Applicable √ Not applicable
No major assets sales in the reporting period of the Company
2. Major equity sales
□ Applicable √ Not applicable
VII. Analysis of Major Subsidiaries and Investees
√ Applicable □ Not applicable
Major subsidiaries and joint-stock companies with a net profit impact of over 10%.
Unit: RMB
Company Registered Operating
Company Name Main businesses Total Assets Net Assets Operating Profit Net Profit
Type Capital income
Sanya Romance
Tourism Subsidiary Theme park + Art
490,000,000.00 934,587,240.66 898,931,442.88 127,098,246.23 79,054,679.57 69,002,874.47
Performance Co., Company performance
Ltd.
Lijiang Chama
Ancient City
Subsidiary Theme park + Art
Tourism 250,000,000.00 606,265,695.91 579,980,699.81 136,520,949.23 74,962,536.68 62,836,710.80
Company performance
Development
Co., Ltd.
Tourism resource
development,
Songcheng
tourism planning
Tourism Subsidiary
and design, artistic 50,000,000.00 709,296,365.59 416,014,324.88 168,821,226.38 163,040,087.48 162,911,596.90
Development Company
creation, brand and
Co., Ltd.
marketing planning
of tourist attractions
Beijing Huafang Internet information
Technology Co., Joint stock service, 1,882,542,983.2 1,503,710,234.6 3,777,442,691.4
53,333,333.00 9,844,199.94 -10,799,124.63
Ltd. (formerly company performance 7 5 1
known as Beijing brokerage business,
32
2020 Annual Report of Songcheng Performance Development Co., Ltd
Six Rooms business on music
Technology Co., entertainment
Ltd.) products through
information
network,
competition
activities
Major holding companies and joint stock companies;
1. The report data of Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) is
presented on the basis of the fair value of the investee's identifiable assets and liabilities when the investment is obtained.
2. This year, the Company made 1,861,297,284.90 yuan of impairment provision for the long-term equity investment in Beijing
Huafang Technology Co., Ltd.
Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □ Not applicable
Method of acquisition and disposal of Impact on overall production management
Company Name
subsidiaries during the reporting period and performance
Zhuhai Songcheng Performance Kingdom
New in 2020
Co., Ltd
Zhuhai Southern Film and Television
Acquire 100% equity in 2020
Cultural Industry Co., Ltd.
A 55% holding subsidiary of Zhuhai
Zhuhai Huayin Landscaping Co., Ltd. Southern Film and Television Culture
Industry Co., Ltd. acquired in 2020
Songcheng Brand Management Co., Ltd. New in 2020
Romance Show Management Co., Ltd. New in 2020
Hangzhou Songcheng Art Troupe Co., Ltd. Canceled in 2020
Zhejiang Songcheng Entertainment Culture
Canceled in 2020
Co., Ltd.
VIII. The structured entity controlled by the Company
□ Applicable √ Not applicable
IX. Prospects for the Future Development of the Company
At the beginning of 2020, the COVID-19 pandemic swept across the world, taking a considerable toll on the social order and
economic operation of all the countries, especially the entertainment and service industries. As a pioneer in the nation's cu ltural
and tourism industry, the Company closed all the scenic spots since January 24 under the call the CPC and government. Until the full
resumption on June 12, financial impact is inevitable due to business suspension and recovering of the industry chain.
After 20 years of development, the Company has experienced difficult times such as the Southeast Asian financial crisis, SARS ,
and the 2008 financial crisis. The history shows that every crisis is a rare development opportunity, especially for companies that are
33
2020 Annual Report of Songcheng Performance Development Co., Ltd
prepared. After this epidemic, competitors with weak financial strength will fail, those lacking creative ability will lose more shares,
and new comers will become more cautious. As a subsequent result, the competition pattern in the industry will be more favorable
to the Company.
As the downward trends of the cultural and travel industry slid as a result of the epidemic, the Company is more aware of its
own position and weak links in the industry. During the epidemic, the Company upgraded hardware against the difficult time, tried
the performing arts kingdom model, and achieved initial results. In the future, the Company will unswervingly transform and
upgrade itself to a performance platform company, and think from the perspective of social communication, internet, and users.
Connecting upstream and downstream sectors, it will build a new value ecology and industry order, and absorb more diversified
professional talents. Meanwhile, a variety of economic components will be developed to constantly acti vate the creativity and
vitality of the Company, making it a more vibrant and imaginative company.
(I) Overview of industry background
In 2020, the entire cultural and tourism industry was hit hard by the COVID-19 epidemic, and many were pushed on the verge
of bankruptcy. According to the National Bureau of Statistics, there were 2.88 billion domestic tourists in 2020, a decrease of 52.1%
from the previous year. Domestic tourism revenue was 2,228.6 billion yuan, down by 61.1%. The Blue Book of Chinese Tourism
Economics (NO.13), issued by the China Tourism Academy (Data Center of the Ministry of Culture and Tourism), estimated that t he
number of domestic tourists in 2021 will recover to 68.3% of 2019 and the revenue of domestic tourism will recover to 57.6% of
2019.
As the epidemic is gradually under control with expanding vaccination, the cultural and tourism industry is slowly recovering ,
and market data is increasing, especially that on domestic tourism. Being the epidemic is still prevalent in other countries, outbound
travel will continue to be restricted. It is expected that the internal circulation of tourism and the return of tourism consumption will
continue to be the main trend of the industry in the future. In the post-epidemic era, demand-side trends of the industry are as
follows:
1. Rising consumption of Generation Z
Generation Z refers to the "indigenous people" of internet born between 1995 and 2009. They grew up with computers,
smartphones, and instant messaging software, carrying features of circle cultures, ACG, and niche preference. According to the
National Bureau of Statistics, the total population of Generation Z in the Chinese mainland is about 260 million, accounting for
about 20% of the total population. The generation is the main group of consumption upgrades with frequent consumption in
tourism. According to the survey data of Mafengwo, 45.3% of Generation Z people travel 2-3 times a year, and 12.4% travel more
than 4 times. The proportions are much higher than those of other age groups, and nearly half of the respondents said that the
epidemic has a small impact on tourism consumption and will maintain their previous level of consumption in tourism after the
epidemic.
The rise of Generation Z is an iterative update of new consumer demand and group culture, and it also brings new economic
trends. In 2021, for the cultural and tourism industry hit by the COVID-19, seizing Generation Z is to grasp the incremental market
for new cultural and tourism consumption in the post-epidemic era. The ability to accurately capture the travel consumption
preferences of Generation Z is the key to success.
2. Rising popularity of surrounding travel
Long-distance travel is relatively restricted during the recovery period of the epidemic, the popularity of travel around the
cities will continue to increase and exist for a long time. Overlapped with the demand back from outbound travel, the surrounding
tourism markets of the Yangtze River Delta, Pearl River Delta, Beijing-Tianjin-Hebei and other core tourist source areas are
expanding significantly. According to the research report of the China Tourism Academy, in the post-epidemic era, tourists of various
34
2020 Annual Report of Songcheng Performance Development Co., Ltd
scenic spots mainly come from within the province. Urban one-day trips and suburban tours have recovered and the proportion of
self-driving trips has increased. Self-guided family tours have become the main market contributor. The in-depth exploration and
repeated consumption of the population in the core cities around the scenic spot will become one of the i mportant tasks of the
market.
3. Tourism consumption from lower-level regions
According to data from the National Bureau of Statistics, in recent years, the growth rate of per capita consumption
expenditure in rural areas was higher than that of urban residents, indicating that rural residents also begun to have more potential
for consumption. The growth rate of domestic tourist arrivals and consumption of rural residents has shown an upward trend in
recent years, while that of urban residents has declined. The decline of domestic cultural and tourism consumption to third-tier and
fourth-tier cities and towns is also related to the more balanced development of the economic level, which will become a long -term
trend.
The Company’s performing arts kingdom model caters to the current consumption needs of Generation Z from the content
side; special events such as summer night tours to meet the surrounding tourism market; the high, medium and low product system
to cope with cultural and tourism consumption from lower-level regions, and the work done during the reporting period closely
focused on the current changes in market trends.
(II) Development strategy planning of the Company
After more than 20 years of development, the Company has established a relatively large competitive advantage in scale,
market, marketing, technology, brand and industry status. In the future, tourism and cultural industries will face unpreceden ted
development opportunities in consumption upgrades. To meet market challenges and seize industry development opportunities,
the Company will adhere to the differentiated and centralized development strategy, give full play to its creative and innova tive
capabilities, strengthen development and application of new technologies, continue to make bre akthroughs in innovative business
forms, and maintain integrated development. While consolidating its foundation in the performing arts, the Company will seek
another leapfrog development to bring its value to a new level.
1. Adhere to differentiation and centralized development
The Company will adhere to the differentiated competition strategy, uphold the banner of "performing arts", and strengthen
the development mode of "theme park + cultural performance", to avoid homogenous competition with other type s of theme parks;
value application of technological innovation to cater to the needs of young people; give full play to creativity to increase attraction
and improve experiences of performance content.
It will remain committed to the strategy of centralized development, and focus on the layout in first-line tourism destinations
and live entertainment fields related to performing arts; remian within its ability circle to avoid excessive development, and stay
cautious in diversification.
2. Attention to creativity and innovation
Innovation is the lifeblood of the Company and only internal creativity can build a century-old Songcheng. The Company, based
on market direction, will adhere to performing arts as the core, and focus on experience. Starting from planning, it will continue to
strengthen the core competitiveness of "performance", and integrate innovation into planning and design, interactive experien ce,
theater matrix, performance content and market planning.
3. Drive innovation in live performance with technology
Technological innovation is a powerful tool to promote the transformation and by upgrading the cultural industry and achieve
35
2020 Annual Report of Songcheng Performance Development Co., Ltd
high-quality development. Technology is playing an increasingly important role in performance effects and the audience experience.
The combination of cutting-edge stage machinery, lighting, sound, and smart equipment will realize the coexistence of the real and
virtual worlds on the same stage/scene, and enhance visitors/audience's experience of the real world while br inging them
unperceivable feelings. In addition, live entertainment with a strong sense of immersion will innovate the overall entertainment
experience.
4. Breakthroughs in business forms
The Company has become an industry leader in tourism and performing arts. That is not enough, it is actively exploring
innovative models, thereby enhancing social contributions. "Tourism performance + urban performance" is advancing, and the
construction of a performing arts kingdom will make it to penetrate from mass tourism to segmented population markets. The
Company will constantly challenge itself to seek a broader market scale and greater development segment. In the construction of
the Shanghai project, multiple shows and diversified ticket combinations will be introduced based on the Romantic Show, extending
its services to tourist groups, locals and those from close regional markets.
5. Committed to integrated development
The current corporate governance has created greater possibilities for the Company's resource integration and group
operations. Integrated development is a powerful weapon to improve combat capabilities and achieve strategic goals. In the fu ture,
the Company will be committed to integration of tourism and cultures, cultures and technology, independent investment and light
assets, entertainment and vacation, marketing and planning, products and markets, contents and platforms, consumers and
producers, theme scenic spots and performing arts kingdom, as well as internet and the capital market.
6. Platform-based strategy for performance
The epidemic has resulted in negative impact to the industrial chain and structure, but also gave birth to new opportunities.
The Company is considering to become a platform for industry accumulation, to gather the industrial chain shattered by the
epidemic and that squeezed out by urbanization on the Company's platform. That includes, for example, professional equipment,
various studios, performing talents and drama platforms, performance management and output, ticketing and international art
exchange platform. The Company will be built into a platform for social communication of young people, family gatherings, the
elderly, and relaxing for business people. It is also a communication platform for various artists and art categories.
(III) Work plan in 2021
Since the outbreak of the epidemic, the Company has focused on recovery strategy and economy. After years of development,
the Company has formed strong capital strength and brand influence, rich intellectual resources and significant competitive
advantages. It has stronger anti-risk capabilities and a better development foundation than ever before. Through systematic review,
consideration and preparation, the Company is full of confidence and enthusiasm, and is ready for t he market repair and further
development after the epidemic is over.
1. Development of Shanghai project
2021 is the first year of the nation's 14th Five-Year Plan and also the 25th anniversary of the establishment of Songcheng
Group, an important milestone for the Company's development. The Shanghai project is a key node to link the past and present.,
and is also an important stage for Songcheng to further consolidate and establish its top position in performance in the worl d. The
Company will be more tolerant and open while leveraging its closed-loop advantages. Songcheng in Shanghai will become a rich
platform for exchanges of various art forms and a platform for live entertainment. In the future, the Shanghai project, with its
location advantages, will carry out various activities like performances, festivals, exhibitions, and IP exhibitions through self-made
shows, customization, introduction, cooperation, and sharing. It will continuously expand circles and influence, and complete the
36
2020 Annual Report of Songcheng Performance Development Co., Ltd
three-dimensional concept of the performance kingdom, while laying a solid foundation for its replication.
2. Upgrade of existing projects
The continuous improvement of existing projects is conducive to better product quality and user experience. The Company will
continue to renovate and upgrade existing projects by expanding and renewing travel routes, adding various types of indoor and
outdoor theaters and shows, and adding popular sites and rest areas. The new changes will increase return visitor attendance
potential.
3. Establish a hierarchical system for high-end, medium-end and low-end products
For the core projects of "Romantic show", some adjustments were made to the "Romantic Show" in Sanya, Xi'an and other
places to extract in-depth new cultural elements, and integrate more stage expressions; the introduction of "Love in" and "Color",
different from the "Romantic Show" series, presents culture in a newer and purer form; the existing outfield performances wer e
also improved, and the features of the scenic spot were ful ly used to make a point-line-field presentation layout of outfield
performances, namely a system in which tourists can watch the shows and participate in immersive interactions. The differenti ation
in the market will not only deepen the type and quality of Songcheng's performance product line, but also further consolidate its
the core position in the local tourism and performance market.
4. Promotion of projects in Foshan, Xitang and Zhuhai
The projects in Foshan and Xitang are the continuation of the Romantic Show product line in the Yangtze River Delta and the
Pearl River Delta. The Company will ensure the steady progress of various projects and accelerate the construction. As a flag ship
product in the future, the Zhuhai project has generated high expectations for the Company, and it will invest accordingly to the
planning and design, engineering construction, and artistic creation to ensure that the Zhuhai project will become a world-class
entertainment destination for performing arts.
5. Continue to strengthen marketing
The Company will penetrate into low-level regions to consider local cultural and market features, and establish a differentiated
market mechanism according to different tourist destinations; strengthen overall layout of channels in each sce nic spot market
based on the introduction of visitor flow, and build an intensive marketing network through online and offline marketing chan nels in
combination with point, line and field; Combine reshaping of the brand, event marketing and precise placeme nt, to make a good
job in the promotion and comprehensive marketing of each project; innovate the promotion mode and find suitable partners and
internet celebrities, strengthen the use of short videos and We media, and activate the promotion of young peopl e on We media.
6. Improve mechanism and talent structure
The Company will focus on three key points in building a talent system in 2021:
(1) Introduction: Fully research the talents required by the post, and identify the features of talents required by different posts.
Introduce high-level talents and establishment a talent pool of Songcheng through external introduction and internal exploration;
expand contacts for professional posts to provide talent support for the Company's innovation strategy.
(2) Use of talents: Today, realizing self-value has become the demand of most young employees. Based on this, the Company
will combine the situation of talents and posts to set up jobs that meet employees' ability development and expectations, and
enable them to achieve self-satisfaction and self-realization while gaining sufficient growth. In addition, a variety of incentive
channels such as joint systems and performance, as well as warm and effective communication will bind talents to promote thei r
sustainable development.
(3) Cultivation: Build a stage for outstanding talents to display their skills and expand their horizons, help them go beyond
37
2020 Annual Report of Songcheng Performance Development Co., Ltd
limitations of the original work and give full play to their ability. The Company will implement a training plan for Songcheng's
high-potential talents, integrate and upgrade the existing talent training system, putting talent and the Company on the same page
in transformation and development.
X. Registration Form for Reception of Research, Communication, Interviews and Other Activities
1. Registration Form for reception of research, communication, interviews and other activities during the
reporting period
√ Applicable □ Not applicable
Main content of
the discussion
Reception Reception Reception Reception Reception
and the Index of the basic information of research
Time location Method target type objects
information
provided
For details, please refer to the "Record of
Brokerage Business
Company Investor Relations Activities on August 8,
August 8, Field researcher and introduction in
meeting Institution 2020" announced by the Company on
2020 Investigation fund company first half of the
room http://www.cninfo.com.cn on August 10,
manager year and Q&A
2020.
For details, please refer to the "Record of
Brokerage
Company Business Investor Relations Activities on Thursday,
October Field researcher and
meeting Institution introduction in October 29, 2020" announced by the
29, 2020 Investigation fund company
room Q3 and Q&A Company on http://www.cninfo.com.cn on
manager
Sunday, November 1, 2020.
38
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section V Significant Events
I. Distribution of Common Stock Profits of the Company and Capitalization of Capital Reserves
Distribution policies of the common stock profits during the reporting period, especially the formulation, implementation or
adjustment of the cash dividend policies
√ Applicable □ Not applicable
Reviewed and approved at the 6th meeting of the 7th Board of Directors held on April 27, 2020 and at the annual
shareholders' meeting for 2019 held on May 18, 2020, the company's plan for profit distribution in 2019 was: Taking the total share
capital of 1,452,607,800 shares of 2019 as the basis, RMB 2.00 (tax included) of dividend for every 10 shares was distributed to all
the shareholders, with a total amount of cash dividend of RMB 290,521,560 and 8 shares capitalized from the capital reserves were
distributed to all the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. After capitalization, t he total
share capital amounted to 2,614,694,040 shares. During the reporting period, the Company has completed the equity distribution.
The equity registration date: May 28, 2020 and the date of exclude right (XR) and exclude dividend (DR): May 29, 2020.
Special notes on cash dividend policies
Whether they comply with the requirements of the Company's
articles of incorporation or the resolutions of the General Yes
Meeting of Shareholders:
Whether the dividend standards and proportions are distinct
Yes
and clear:
Whether the relevant decision-making procedures and
Yes
mechanisms are complete:
Whether the independent directors performed their duties and
Yes
played their due role:
Whether the minority shareholders have the opportunity to fully
express their opinions and appeals, and whether their legitimate Yes
rights and interests have been fully protected:
Whether relevant conditions and procedures are compliant and
transparent when the cash dividend policies are being adjusted Not applicable.
or changed:
The plan for profit distribution and capitalization of capital reserves during the reporting period is consistent with relevant
provisions in the articles of association and dividend management measures of the Company
√ Yes □ No □ Not applicable
The plan for profit distribution and capitalization of capital reserves during the reporting period is in compliance with relevant
provisions in the articles of association of the Company.
Profit distribution and capitalization of capital reserves in the current year
Number of bonus shares per 10 shares (shares) 0
Number of dividend payout per 10 shares (RMB) (tax included) 0.5
39
2020 Annual Report of Songcheng Performance Development Co., Ltd
Number of capitalized shares per 10 shares (shares) 0
Equity base in the distribution preplan (shares) 2,614,694,040
The amount of cash dividends (yuan) (including tax) 130,734,702.00
The amount of cash dividends (yuan) in other ways (such as
0.00
share repurchase)
The total amount of cash dividends (including in other ways)
130,734,702.00
(yuan)
Distributable profits (RMB) 3,132,049,591.95
The ratio of the total amount of cash dividends (including in
100.00%
other ways) to the total amount of profit distribution
Latest cash dividend
If the Company's development stage is not easy to define but there are significant capital expenditure arrangements, when the
profits are being distributed, the proportion of the cash dividends in this profit distribution should be at least 20%
Details of the preplans on profit distribution or capitalization of capital reserves
Audited by BDO China Shu Lun Pan CPAs (special general partnership), the net profit attributable to the shareholders of the listed
company in 2020 was RMB -1,752,398,000. Based on the total share capital of 2,614,694,040 shares as at December 31, 2020, the
Company distributed RMB 0.50 (tax included) of dividend for every 10 shares to all the shareholders, with a total cash dividend of
RMB 130,734,702.
The Company's common stock dividends distribution plan (preplan) and capital reserve capitalization plan (preplan) in the pas t
three years (including this reporting period)
The 2018 profit distribution plan: according to the resolution of 2018 annual shareholders' meeting, the Company
implemented the 2018 profit distribution plan on May 15, 2019, which was: based on the total share capital of 1,452,607,800
shares as at December 31, 2018, the Company distributed RMB 1.2 (tax included) of dividend for every 10 shares to all the
shareholders, with a total cash dividend of RMB 174,312,900.
The plan for profit distribution and capitalization of capital reserves of the Company in 2019: according to the resolution of
2019 annual shareholders' meeting, the Company implemented the 2019 profit distribution plan on May 28, 2020, which was:
Taking the total share capital of 1,452,607,800 shares as at December 31, 2019 as the basis, RMB 2.00 (tax included) of dividend for
every 10 shares was distributed to all the shareholders, with a total cash dividend of RMB 290,521,560 and 8 shares capitalized from
the capital reserves were distributed to all the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. Upon
such capitalization, the total share capital amounted to 2,614,694,040 shares.
The 2020 profit distribution preplan: the 10th meeting of the 7th Board of Dire ctors and the 8th meeting of the 7th Board of
Supervisors held by the Company on April 22, 2021 reviewed and approved the 2020 Profit Distribution Preplan. According to the
Audit Report issued by BDO China Shu Lun Pan CPAs Co., Ltd (Xin Kuai Shi Bao Zi [2021] No. ZA11461), the Company achieved a net
profit attributable to the shareholders of listed companies in the amount of RMB -1,752,398,009.60 in 2020, plus the undistributed
profits at the end of the previous year in the amount of RMB 5,176,157,180.79, deduct the distributed dividends for 2019 in the
amount of RMB 290,521,560.00 and add the retained earnings carried forward from other comprehensive income in the amount of
RMB -1,356,586.59, the actual distributable profit for shareholders in 2020 was RMB 3131881024.60. As at December 31, 2020, the
balance of capital reserves of the Company was RMB 1,211,364,214.86.
Based on the total share capital of 2,614,694,040 shares at the end of 2020, the Company planned to distribute RMB 0.50 (tax
included) of dividend for every 10 shares to all the shareholders, with a total cash dividend of RMB 130,734,702 in 2020.
It is held by the Board of the Directors of the Company that although the epidemic impacted the performances of the Company,
40
2020 Annual Report of Songcheng Performance Development Co., Ltd
the 2020 profit distribution plan proposed by the Company was consistent with the provisions concerning profit distribution in the
Company Law, the Circular of the CSRC on Further Implementation of the Matters Concerning Cash Dividends of the Listed
Companies, the Guideline No. 3 of the CSRC on Regulation of the Listed Companies - Cash Dividends of the Listed Companies, the
Articles of Association, and other laws and regulations, and was legal ,compliant and reasonable in view of the Company's
confidence for long-term development, for better consideration of both the immediate interests and long-term interests, in
accordance with the relevant provisions of the CSRC which encourage distribution of dividends and on the condition that the
healthy, sustainable development of the Company was guaranteed. The Company needs to submit the above plan to 2020 annual
shareholders' meeting of the Company for review.
The Company's cash dividends for common stocks in the past three years (including this reporting period)
Unit: RMB
The ratio of total
Net profit The proportion of
The ratio of cash amount of cash
attributable to cash dividends in
dividends to the dividends
common stock other ways to the
net profit (including other
shareholders of The amount of net profit
attributable to Total amount of ways) to the net
Cash dividend listed companies cash dividends in attributable to
ordinary cash dividends profit attributable
Year amount (tax in the other ways (such ordinary
shareholders of (including other to ordinary
included) consolidated as share shareholders of
listed companies ways) shareholders of
financial repurchase) listed companies
in the listed companies
statement of the in the
consolidated in the
year for dividend consolidated
statements consolidated
distribution statements
statements
2020 130,734,702.00 -1,752,398,009.60 -7.46% 130,734,702.00 -7.46%
2019 290,521,560.00 1,339,790,994.94 21.68% 290,521,560.00 21.68%
2018 174,312,936.00 1,287,186,547.41 13.54% 174,312,936.00 13.54%
The Company's profits during the reporting period and the parent company's distribution of common stock shareholders' profits are
positive but a cash dividend distribution preplan for common stock is not proposed.
□ Applicable √ Not applicable
II. Performance of Commitments
1. Commitments made by the Company's controlling shareholders’, shareholders, related parties, purchasers
and purchasing companies and have been fulfilled during the reporting period and those that have not been
fulfilled by the end of the reporting period
□ Applicable √ Not applicable
There are no commitments which should be fulfilled during the reporting period as promised by the Company's actual
controller, shareholders, related parties, purchasers and purchasing companies and those that have not been fulfilled by the end of
the reporting period.
41
2020 Annual Report of Songcheng Performance Development Co., Ltd
2. If there is a profit forecast for the Company's assets or projects, and the reporting period is still within the
profit forecast period, the Company shall make an explanation on the fulfillment and its reasons
□ Applicable √ Not applicable
III. Occupation of the Capital of Listed Companies by Controlling Shareholders and Their Related
Parties for Non-operational Purposes
□ Applicable √ Not applicable
During the reporting period, there is no non-operational capital occupation over listed companies by controlling shareholders
and their related parties.
IV. Explanations Made by the Board of Directors on the Latest "Non-standard Audit Report"
□ Applicable √ Not applicable
V. Explanations Made by the Board of Directors, the Board of Supervisors and Independent
Directors (If Any) on the "Non-standard Audit Report" from the Accounting Firm during the
Reporting Period
□ Applicable √ Not applicable
VI. Explanations Made by the Board of Directors on the Changes to the Accounting Polices and
Accounting Estimates or the Corrections of Significant Accounting Error during the Reporting
Period
√ Applicable □ Not applicable
1、 Changes in significant accounting policies
1) Implementation of "Accounting Standards for Business Enterprises No. 14 - Revenue" (revised in 2017) (hereinafter referred
to as "New Revenue Standards")
The Ministry of Finance revised the "Accounting Standards for Business Enterprises No. 14 - Revenue" in 2017 The revised
standards stipulate that for the first implementation of the standards, the amount of retained earnings and other related items in
the financial statements at the beginning of the year should be adjusted according to the cumulative effects, and the informa tion
for the comparable period should not be adjusted.
This Company implemented the new revenue standards since January 1, 2020. According to the standards, the company only
adjusted the retained earnings and other related items in the financial statements at the beginning of the year 2020 for the
cumulative effects of contracts that have not been completed on the date of first implementation, and the comparative financial
statements were not adjusted. These standards have the following major effects:
Content and Reasons for Change in Accounting Approval process Statements Affected Amount of Balance on
Policies Affected January 1, 2020
Consolidated Parent
Subsidiaries company
(1) The advance payments related to the The 6th meeting of the Received
-311,838,903.34 -731,628.89
contractual income are reclassified into the 7th Board of Directors Prepayments
42
2020 Annual Report of Songcheng Performance Development Co., Ltd
contractual liabilities. Contract
294,302,487.38 710,319.31
liabilities
Other Current
17,536,415.96 21,309.58
Liabilities
Compared with the original revenue standards, implementation of the new revenue standards has the following effects on the
relevant items of the financial statements in 2020 (increase/(decrease)):
Balance Sheets Items Affected Affected Amount of Balance on Thursday, December 31, 2020
Consolidated Subsidiaries Parent company
Contract liabilities 188,550,237.52
Received Prepayments -192,064,139.60
Other Current Liabilities 3,513,902.08
2) Implementation of "Accounting Standards for Business Enterprises Interpretation No. 13"
The Ministry of Finance issued the "Accounting Standards Interpretation for Business Enterprises No. 13" (CaiKuai [2019] No.
21, hereinafter referred to as "Interpretation No. 13") on December 10, 2019, which came into force on January 1, 2020.
Retrospective adjustment was not required.
① Identification of Related Parties
Interpretation No. 13 clarifies that the following circumstances constitute a related party: a joint venture or affiliated bu siness
between an enterprise and other member units (including parent companies and subsidiaries) of the enterprise group to which it
belongs; a joint venture of the enterprise and other joint ventures or affiliated business. In addition, Interpretation No. 1 3 also
clarifies that only two or more companies that are only significantly affected by one party do not constitute a related party. It also
adds that affiliated business includes affiliated business and their subsidiaries, and joint ventures include joint ventures and their
subsidiaries.
② Definition of Business
Interpretation No. 13 completes the three elements of business composition, refines the judgment conditions of business
composition, and at the same time introduces the "concentration ratio test" option to simplify to a certain extent the proble ms
such as judgment of whether a combination obtained under the same control constitutes a business, etc.
The company implemented Interpretation No. 13 since January 1, 2020, and the comparative financial statements were not
adjusted. The implementation of Interpretation No. 13 did not have significant impact on the company’s financial status and
operating results.
3) Implementation of the "Interim Provisions on Accounting Treatment of Carbon Emission Rights Trading"
On December 16, 2019, the Ministry of Finance issued the "Interim Provisions on Accoun ting Treatment of Carbon Emission
Rights Trading" (CaiKuai [2019] No. 22), which is applicable to related companies in the key emission units (hereinafter refe rred to
as key emission companies) which operate carbon emission rights trading business in accordance with the "Interim Measures for
the Management of Carbon emission Rights Trading”. This provision came into effect on January 1, 2020, and key emission
companies should adopt prospective application to apply this provision.
The company implemented this provision since January 1, 2020, and the comparative financial statements were adjusted. The
implementation of this provision did not have significant impact on the company’s financial status and operating results.
4) Implementation of the "Provisions on accounting treatment of rent concessions related to COVID-19"
On June 19, 2020, the Ministry of Finance issued the "Provisions on accounting treatment of rent concessions related to
COVID-19" (CaiKuai (2020) No. 10), which came into effect on June 19, 2020, allowing companies to adjust related rent concessions
that occurred between January 1, 2020 and the implementation date of this provision. According to this provision, for rent
concessions directly caused by COVID-19 that meet the conditions, for example, rent remission and deferred payment of rent,
43
2020 Annual Report of Songcheng Performance Development Co., Ltd
companies can choose to adopt simplified methods for accounting treatment.
The company adopts the simplified method for accounting all rent concessions within the scope the provision, and adjusted
the relevant rent concessions from January 1, 2020 to the date of implementation of the provision accordingly.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down the
operating costs, management expenses and sales expenses for the current period in the total amount of RMB 13,042,042.83.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down the
operating costs for the current period, such rent simplification had no significant impact on the Compan y.
2. Changes in Significant Accounting Estimates
There were no changes in significant accounting estimates during the reporting period.
3. First implementation of the new revenue standards, and adjustment of related items of the financial
statements at the beginning of the year
Consolidated Balance Sheet
Item Balance at the end of Balance at the Adjusted amount
the previous year beginning of the year Re-classification Re-measurement Total
Current Assets:
Cash and Bank Balances 1,785,124,821.87 1,785,124,821.87
Deposit Reservation for
Balance
Loans to Banks and Other
Financial Institutions
Trading Financial Assets 854,108,086.54 854,108,086.54
Derivative Financial Assets
Note’s receivable
Accounts receivable 5,337,855.43 5,337,855.43
Receivables Financing
Prepayments 17,221,603.54 17,221,603.54
Premium Receivable
Reinsurance Accounts
Receivable
Reinsurance Contract
Reserves Receivable
Other Receivables 125,573,266.78 125,573,266.78
Buying Back the Sale of
Financial Assets
Inventory 6,110,221.56 6,110,221.56
Contract Assets Not applicable.
Holding for-sale assets
Non-current Assets Due
within 1 Year
Other Current Assets 127,570,975.96 127,570,975.96
Subtotal of Current Assets 2,921,046,831.68 2,921,046,831.68
Non-current Assets:
44
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item Balance at the end of Balance at the Adjusted amount
the previous year beginning of the year Re-classification Re-measurement Total
Granting of loans and
advances
Investment in Creditor's
Rights
Investment in Other
Creditor's Rights
Long-term Receivables
Long-term Equity Investment 3,468,596,165.08 3,468,596,165.08
Investment in Other Equity 300,959,931.64 300,959,931.64
Instruments
Other Non-current Financial
Assets
Investment Property
Fixed Assets 2,311,251,277.89 2,311,251,277.89
Projects under Construction 370,000,233.10 370,000,233.10
Productive Biological Assets
Oil and gas assets
Intangible Assets 1,498,490,129.82 1,498,490,129.82
Development Expenditure
Goodwill 28,078,665.69 28,078,665.69
Long-term unamortized 112,440,627.02 112,440,627.02
expenses
Deferred Income Tax Assets 9,148,452.39 9,148,452.39
Other Non-current Assets 21,064,619.27 21,064,619.27
Subtotal of Non-current 8,120,030,101.90 8,120,030,101.90
Assets
Total Assets 11,041,076,933.58 11,041,076,933.58 -
Current Liabilities:
Short-term loan
Borrowings from the Central
Bank
Borrowings from Banks and
Other Financial Institutions
Transactional financial
liabilities
Derivative Financial Liabilities
Notes Payable
Accounts Payable 300,656,879.62 300,656,879.62
Received Prepayments 351,733,456.28 39,894,552.94 -311,838,903.34 -311,838,903.34
45
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item Balance at the end of Balance at the Adjusted amount
the previous year beginning of the year Re-classification Re-measurement Total
Contract liabilities Not applicable. 294,302,487.38 294,302,487.38 294,302,487.38
Financial Assets Sold for
Repurchase
Deposit Taking and Interbank
Deposit
Receiving from Vicariously
Traded Securities
Receiving from Vicariously
Sold Securities
Payroll payable 26,737,888.43 26,737,888.43
Tax Payable 22,614,171.64 22,614,171.64
Other Payables 63,299,348.02 63,299,348.02
Service Charge and
Commission Payable
Reinsurance Accounts Payable
Holding for-sale liabilities
Non-current Liabilities Due
within 1 Year
Other Current Liabilities 17,536,415.96 17,536,415.96 17,536,415.96
Subtotal of Current Liabilities 765,041,743.99 765,041,743.99
Non-current Liabilities:
Insurance Contract Reserves
Long-term loan
Bonds Payable
Including: Preferred Stocks
Perpetual Bonds
Long-term Payables
Long-term payroll payable
Expected Liabilities
Deferred Income 382,872,318.90 382,872,318.90
Deferred Income Tax 10,771,548.18 10,771,548.18
Liabilities
Other Non-current Liabilities
Subtotal of Non-current 393,643,867.08 393,643,867.08
Liabilities
Total Liabilities 1,158,685,611.07 1,158,685,611.07
Shareholders' Equity:
Share Capital 1,452,607,800.00 1,452,607,800.00
Other Equity Instruments
46
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item Balance at the end of Balance at the Adjusted amount
the previous year beginning of the year Re-classification Re-measurement Total
Including: Preferred Stocks
Perpetual Bonds
Capital Reserves 2,476,312,069.09 2,476,312,069.09
Less: Treasury Share
Other Comprehensive -8,681,151.59 -8,681,151.59
Incomes
Special Reserves
Surplus Reserves 517,673,268.35 517,673,268.35
General Risk Reserves
Undistributed Profits 5,176,157,180.79 5,176,157,180.79
Total Shareholders' Equity 9,614,069,166.64 9,614,069,166.64
Attributable to the Parent
Company
Minority Shareholders' Equity 268,322,155.87 268,322,155.87
Total Shareholders' Equity 9,882,391,322.51 9,882,391,322.51
Total Liabilities and 11,041,076,933.58 11,041,076,933.58
Shareholders' Equity
Balance Sheet of the Parent Company
Item Balance at the end of the Balance at the beginning Adjusted amount
previous year of the year Re-classification Re-measurement Total
Current Assets:
Cash and Bank Balances 645,534,966.84 645,534,966.84
Trading Financial Assets 351,492,520.54 351,492,520.54
Derivative Financial Assets
Note’s receivable
Accounts receivable 1,269,835.09 1,269,835.09
Receivables Financing
Prepayments 2,458,855.65 2,458,855.65
Other Receivables 1,100,294,815.74 1,100,294,815.74
Inventory 2,465,844.42 2,465,844.42
Contract Assets Not applicable
Holding for-sale assets
Non-current Assets Due
within 1 Year
Other Current Assets 1,671,867.65 1,671,867.65
Subtotal of Current Assets 2,105,188,705.93 2,105,188,705.93
Non-current Assets:
Investment in Creditor's
47
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item Balance at the end of the Balance at the beginning Adjusted amount
previous year of the year Re-classification Re-measurement Total
Rights
Investment in Other
Creditor's Rights
Long-term Receivables
Long-term Equity 6,941,849,814.49 6,941,849,814.49
Investment
Investment in Other Equity 294,665,442.88 294,665,442.88
Instruments
Other Non-current
Financial Assets
Investment Property
Fixed Assets 503,463,063.75 503,463,063.75
Projects under 59,331,122.60 59,331,122.60
Construction
Productive Biological Assets
Oil and gas assets
Intangible Assets 145,128,033.35 145,128,033.35
Development Expenditure
Goodwill
Long-term unamortized 10,183,821.75 10,183,821.75
expenses
Deferred Income Tax Assets 7,476,137.89 7,476,137.89
Other Non-current Assets 9,838,928.50 9,838,928.50
Subtotal of Non-current 7,971,936,365.21 7,971,936,365.21
Assets
Total Assets 10,077,125,071.14 10,077,125,071.14
Current Liabilities:
Short-term loan
Transactional financial
liabilities
Derivative Financial
Liabilities
Notes Payable
Accounts Payable 44,171,004.81 44,171,004.81
Received Prepayments 22,214,761.65 21,483,132.76 -731,628.89 -731,628.89
Contract liabilities Not applicable 710,319.31 710,319.31 710,319.31
Payroll payable 12,673,534.31 12,673,534.31
Tax Payable 4,818,330.21 4,818,330.21
Other Payables 1,953,433,149.11 1,953,433,149.11
48
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item Balance at the end of the Balance at the beginning Adjusted amount
previous year of the year Re-classification Re-measurement Total
Holding for-sale liabilities
Non-current Liabilities Due
within 1 Year
Other Current Liabilities 21,309.58 21,309.58 21,309.58
Subtotal of Current 2,037,310,780.09 2,037,310,780.09
Liabilities
Non-current Liabilities:
Long-term loan
Bonds Payable
Including: Preferred Stocks
Perpetual Bonds
Long-term Payables
Long-term payroll payable
Expected Liabilities
Deferred Income 5,620,598.89 5,620,598.89
Deferred Income Tax 9,983,693.86 9,983,693.86
Liabilities
Other Non-current
Liabilities
Subtotal of Non-current 15,604,292.75 15,604,292.75
Liabilities
Total Liabilities 2,052,915,072.84 2,052,915,072.84
Shareholders' Equity:
Share Capital 1,452,607,800.00 1,452,607,800.00
Other Equity Instruments
Including: Preferred Stocks
Perpetual Bonds
Capital Reserves 2,478,350,525.70 2,478,350,525.70
Less: Treasury Share
Other Comprehensive 31,870,051.79 31,870,051.79
Incomes
Special Reserves
Surplus Reserves 517,673,268.35 517,673,268.35
Undistributed Profits 3,543,708,352.46 3,543,708,352.46
Total Shareholders' Equity 8,024,209,998.30 8,024,209,998.30
Total Liabilities and 10,077,125,071.14 10,077,125,071.14
Shareholders' Equity
49
2020 Annual Report of Songcheng Performance Development Co., Ltd
VII. Changes in the Scope of Consolidated Financial Statements Compared with the Financial
Report of Previous Year
√ Applicable □ Not applicable
There are 5 newly merged units in this period, the reasons are:
New Merged Units This Year Investment Ratio Notes
Zhuhai Songcheng Performance Kingdom Co., Ltd 100% New in 2020
Zhuhai Southern Film and Television Cultural 100% Acquire 100% equity in 2020
Industry Co., Ltd.
Zhuhai Huayin Landscaping Co., Ltd. 55% 55% holding subsidiary affiliated
Zhuhai Southern Film and Television Cultural Industry
Co., Ltd. acquired in 2020
Songcheng Brand Management Co., Ltd. 100% New in 2020
Romance Show Management Co., Ltd. 100% New in 2020
In the current period, the number of merged units was reduced by 2 due to:
Reduced Merged Units This Year Investment Ratio Notes
Hangzhou Songcheng Art Troupe Co., Ltd. 100% Canceled in 2020
Zhejiang Songcheng Entertainment Culture Co., 100% Canceled in 2020
Ltd.
VIII. Appointment and Dismissal of Accounting Firms
Currently appointed accounting firms
Names of domestic accounting firms BDO China Shu Lun Pan CPAs (special general partnership)
Remuneration to domestic accounting firms (Unit: ten thousand
130
yuan)
Years of continuous audit service of domestic accounting firms 20 years
Names of Certified Public Accountants from domestic
Ni Yilin, Jiang Xuelian
accounting firms
The continuous period of audit service for certified public
2 years, 2 years
accountants in domestic accounting firms
Whether to employ another accounting firm
□ Yes √ No
Appointment of accounting firms, financial advisers or sponsors for internal control auditing
□ Applicable √ Not applicable
IX. Delisting after Disclosure of Annual Report
□ Applicable √ Not applicable
50
2020 Annual Report of Songcheng Performance Development Co., Ltd
X. Bankruptcy and Restructuring
□ Applicable √ Not applicable
No such case as bankruptcy and reorganization related event during the reporting period.
XI. Major Lawsuits and Arbitrations
□ Applicable √ Not applicable
There is no major lawsuit or arbitration in this year.
XII. Penalties and Rectification
□ Applicable √ Not applicable
No such case as penalty and rectification during the reporting period.
XIII. Integrity of the Company, Its Controlling Shareholder and Actual Controller
√ Applicable □ Not applicable
The Company, its controlling shareholder and actual controller are in good standing during the reporting period.
XIV. Implementation of the Company's Equity Incentive Plan, Employee Stock Ownership Plan or
Other Employee Incentive Measures
□ Applicable √ Not applicable
During the reporting period, the Company has no equity incentive plan, employee stock ownership plan or other employee
incentive measures and their implementation.
51
2020 Annual Report of Songcheng Performance Development Co., Ltd
XV. Significant Related-party Transactions
1. Related transactions relevant to daily operations
√ Applicable □ Not applicable
Amount of Proportion Approved Whether
Relation Content of Principle Available
Type of Price of related in the transaction the Settlement
Related with the related - for pricing market price Date of
related related transaction number of limit (RMB approved of related Disclosure Index
transaction related party of related for similar Disclosure
transaction transaction (RMB Ten similar Ten limit is transaction
party transaction transaction transactions
Thousand) transactions Thousand) exceeded
Hangzhou On-line
Affiliated Recurring Refer to Cash and Thursday,
First World procurement
legal related the market 282.04 282.04 1.32% 37,062.23 No Bank 282.04 March 28, http://www.cninfo.com.cn
Hotel Co., of hotel
person transactions price Balances 2019
Ltd. products
Hangzhou On-line
Affiliated Recurring Refer to Cash and Thursday,
Songcheng procurement
legal related the market 634.3 634.3 2.96% 37,062.23 No Bank 634.3 March 28, http://www.cninfo.com.cn
Industry Co., of hotel
person transactions price Balances 2019
Ltd products
Beijing Beite
Delegation of
Shengdi Contingent Refer to Cash and
the scenic
Technology Affiliate related the market 2915.6 2,915.60 3.02% 2,915.60 No Bank 2915.6
spot-related
Development transactions price Balances
projects
Co., Ltd.
Hangzhou
Affiliated Recurring Refer to Cash and Thursday,
First World
legal related Ticket sales the market 143.58 143.58 0.67% 37,062.23 No Bank 143.58 March 28, http://www.cninfo.com.cn
Hotel Co.,
person transactions price Balances 2019
Ltd.
52
2020 Annual Report of Songcheng Performance Development Co., Ltd
Amount of Proportion Approved Whether
Relation Content of Principle Available
Type of Price of related in the transaction the Settlement
Related with the related - for pricing market price Date of
related related transaction number of limit (RMB approved of related Disclosure Index
transaction related party of related for similar Disclosure
transaction transaction (RMB Ten similar Ten limit is transaction
party transaction transaction transactions
Thousand) transactions Thousand) exceeded
Hangzhou
Affiliated Recurring Refer to Cash and Thursday,
Songcheng
legal related Ticket sales the market 242.57 242.57 1.13% 37,062.23 No Bank 242.57 March 28, http://www.cninfo.com.cn
Industry Co.,
person transactions price Balances 2019
Ltd
No (The
rent of 4.5
Hangzhou months is
Affiliated Recurring Leasing of Refer to Cash and Thursday,
Songcheng reduced
legal related the office the market 251.62 251.62 9.75% 402.59 Bank 251.62 March 28, http://www.cninfo.com.cn
Industry Co., for related
person transactions space price Balances 2019
Ltd parties
due to the
epidemic)
No (The
rent of 4.5
Hangzhou months is
Affiliated Recurring Leasing of Refer to Cash and Saturday,
Songcheng reduced
legal related the parking the market 622.51 622.51 24.11% 996.01 Bank 622.51 December http://www.cninfo.com.cn
Industry Co., for related
person transactions lot price Balances 17, 2016
Ltd parties
due to the
epidemic)
Hangzhou Leasing of No (The
Affiliated Recurring Refer to Cash and Thursday,
Songcheng the rent of 4.5
legal related the market 149.49 149.49 5.79% 239.18 Bank 149.49 March 28, http://www.cninfo.com.cn
Industry Co., operating months is
person transactions price Balances 2019
Ltd room in the reduced
53
2020 Annual Report of Songcheng Performance Development Co., Ltd
Amount of Proportion Approved Whether
Relation Content of Principle Available
Type of Price of related in the transaction the Settlement
Related with the related - for pricing market price Date of
related related transaction number of limit (RMB approved of related Disclosure Index
transaction related party of related for similar Disclosure
transaction transaction (RMB Ten similar Ten limit is transaction
party transaction transaction transactions
Thousand) transactions Thousand) exceeded
scenic spot for related
parties
due to the
epidemic)
No (The
rent of 4.5
Hangzhou months is
Affiliated Recurring Leasing of Refer to Cash and Thursday,
Songcheng reduced
legal related the the market 160.06 160.06 6.20% 256.1 Bank 160.06 March 28, http://www.cninfo.com.cn
Industry Co., for related
person transactions dormitory price Balances 2019
Ltd parties
due to the
epidemic)
No (The
rent of 4.5
Hangzhou months is
Affiliated Recurring Leasing of Refer to Cash and Thursday,
Songcheng reduced
legal related the parking the market 296.66 296.66 11.49% 474.66 Bank 296.66 March 28, http://www.cninfo.com.cn
Industry Co., for related
person transactions lot price Balances 2019
Ltd parties
due to the
epidemic)
Hangzhou Leasing of No (The
Affiliated Recurring Refer to Cash and Thursday,
Songcheng the rent of 4.5
legal related the market 173.93 173.93 6.74% 278.28 Bank 173.93 March 28, http://www.cninfo.com.cn
Industry Co., operating months is
person transactions price Balances 2019
Ltd room in the reduced
54
2020 Annual Report of Songcheng Performance Development Co., Ltd
Amount of Proportion Approved Whether
Relation Content of Principle Available
Type of Price of related in the transaction the Settlement
Related with the related - for pricing market price Date of
related related transaction number of limit (RMB approved of related Disclosure Index
transaction related party of related for similar Disclosure
transaction transaction (RMB Ten similar Ten limit is transaction
party transaction transaction transactions
Thousand) transactions Thousand) exceeded
scenic spot for related
parties
due to the
epidemic)
No (The
rent of 4.5
Leasing of
Hangzhou months is
Affiliated Recurring the Refer to Cash and Monday,
First World reduced
legal related operating the market 47.25 47.25 1.83% 75.6 Bank 47.25 February http://www.cninfo.com.cn
Hotel Co., for related
person transactions room in the price Balances 29, 2016
Ltd. parties
scenic spot
due to the
epidemic)
No (The
rent of 4.5
Hangzhou months is
Affiliated Recurring Leasing of Refer to Cash and Thursday,
World Leisure reduced
legal related the parking the market 431.82 431.82 16.73% 690.91 Bank 431.82 March 28, http://www.cninfo.com.cn
Expo Park for related
person transactions lot price Balances 2019
Co., Ltd parties
due to the
epidemic)
Hangzhou No (The
Affiliated Recurring Leasing of Refer to Cash and Thursday,
World Leisure rent of 4.5
legal related the the market 67.73 67.73 2.62% 108.36 Bank 67.73 March 28, http://www.cninfo.com.cn
Expo Park months is
person transactions dormitory price Balances 2019
Co., Ltd reduced
55
2020 Annual Report of Songcheng Performance Development Co., Ltd
Amount of Proportion Approved Whether
Relation Content of Principle Available
Type of Price of related in the transaction the Settlement
Related with the related - for pricing market price Date of
related related transaction number of limit (RMB approved of related Disclosure Index
transaction related party of related for similar Disclosure
transaction transaction (RMB Ten similar Ten limit is transaction
party transaction transaction transactions
Thousand) transactions Thousand) exceeded
for related
parties
due to the
epidemic)
Total -- -- 6,419.16 -- 154,686.21 -- -- -- -- --
Details of major sales returned N/A
Actual performance during the reporting period
where the total amount of daily related party
N/A
transactions in the current period is estimated by
category (if any)
Reasons for the big difference between the
transaction price and the reference market price, if Not applicable.
applicable
56
2020 Annual Report of Songcheng Performance Development Co., Ltd
2. Related transactions in acquisition or sale of assets or equities
□ Applicable √ Not applicable
No such case as related-party transactions arising from the acquisition or sale of assets or equity.
3. Significant related-party transactions arising from joint investments on external parties
√ Applicable □ Not applicable
Total assets
Net asset of Net profit of
Registered of the
the invested the invested
Relation with Name of the Main business of the capital of invested
Co-investor enterprise enterprise
related party invested enterprise invested enterprise the invested enterprise
(RMB Ten (RMB Ten
enterprise (RMB Ten
Thousand) Thousand)
Thousand)
Equity investment,
Ningno Songcheng
project investment,
Ningbo Performance Live
investment
Songcheng Qixian Entertainment
management, RMB 300
Investment Affiliate Investment 17,550.96 17,550.96 -102.44
enterprise million
Management Co., Partnership
management and
Ltd. (limited
investment
partnership)
consultation
Project investment,
Hangzhou
Ningno Songcheng investment
Songcheng Group
Internet management,
Holdings Co., Ltd,
Controlling Entertainment enterprise
Ningbo Qixian RMB 125
shareholder, Investment management 7,180.58 7,100.58 -1,914.45
Internet million
affiliate Partnership consultation,
Investment
(limited investment
Management Co.,
partnership) consultation and
Ltd.
equity investment
Entertainment project
investment, industrial
Ningno Meishan
Shenzhen CGS investment, project
Bonded Port Area
Fund investment,
Qixian Innovation
Management Co., Affiliated investment
Entertainment RMB 155
Ltd., Qixian Equity legal person, management, 7,334.14 7,331.64 -212.43
Investment million
Investment affiliate enterprise
Partnership
Management Co., management
(limited
Ltd. consultation and
partnership)
investment
management
57
2020 Annual Report of Songcheng Performance Development Co., Ltd
Progress of major projects
under construction of the N/A
invested enterprise, if any
Other notes: in September 2019, Songcheng Holdings (Thailand) Co., Ltd., a wholly -owned subsidiary of the Company, and
Qiyun Holdings (Thailand) Co., Ltd., a related person, jointly established Songcheng (Pattaya) International Culture Co., Ltd. with the
registered capital of THB 5 million, for which the parties paid THB 3.25 million and THB 750 thousand respectively, accountin g for
65.00% and 15.00%. As at December 31, 2020, neither the Company nor the related persons have completed the contribution.
4. Related-party creditor's rights and debts
□ Applicable √ Not applicable
No such case as related credits and debts during the reporting period.
5. Other major related transactions
□ Applicable √ Not applicable
XVI. Major Contracts and Their Performance
1. Matters on trusteeship, contracting, and leasehold
(1) Matters on trusteeship
□ Applicable √ Not applicable
No such case as custody during the reporting period.
(2) Contracting
□ Applicable √ Not applicable
No such case as contracting during the reporting period.
(3) Leasing
□ Applicable √ Not applicable
2. Significant guarantees
□ Applicable √ Not applicable
There is no guarantee during the reporting period.
58
2020 Annual Report of Songcheng Performance Development Co., Ltd
3. Entrusting Others to Manage Cash Assets
(1) Entrusted Financing
□ Applicable √ Not applicable
No such case as entrusted financing during the reporting period.
(2) Entrusted Loans
□ Applicable √ Not applicable
No such case as entrusted loan during the reporting period.
4. Other Significant Contracts
□ Applicable √ Not applicable
No such case as other significant contract during the reporting period.
XVII. Social Responsibilities
1. Fulfillment of Social Responsibilities
Since establishment, he Company, has been exploring in the cultural and tourist industry with the spirit of craftsmanship, and
been devoted to cultivating the traditional culture and art of China with the idea of industry innovation, which formed a uni que
business model and made contributions to the dissemination of Chinese culture. In the past years, the Company stayed true to its
mission, and insisted on fulfilling its corporate social responsibilities with the support from its operating performances su ch as
continued expansion of businesses, year-on-year increase of visitors and stable profit growth. The company always adheres to the
practice of corporate social responsibility, and promotes the prosperity and development of the Chinese culture and art in an
all-round, three-dimensional and multi-angle manner through featured theme activities, public charity and other methods, so as to
make its contribution to promotion of the Chinese traditional culture.
The Company brought magnificent art feasts for thousands of masses in the mountainous areas through "Songcheng Travel of
Poverty Alleviation in Cultural Caravans", donated RMB 10 million to the areas ravaged by catastrophic floods in Ningxiang Ci ty,
Hunan Province, helped Guilin, Zhangjiajie and Xi'an in poverty alleviation in the field of culture and art through its local projects,
established "Culture and Art Poverty Alleviation Fund" by donation, and supported the development of the local culture. What
traditional culture gives Songcheng is not only the inexhaustible source of creation, but also the special cultural feeling.
In September 2018, the Company initiated and established Zhejiang Songcheng Performance Art Development Foundation to
"support the development of the national art and performance and the poverty alleviation in art". It was a new attempt of the
Company in the field of public charity to better achieve the goal of "contributing to the society". The Foundation will promo te the
prosperous development of the Chinese culture and art in an all -round, three-dimensional and multi-angle manner through poverty
alleviation in art, industry-university-research cooperation, funding of excellent projects and talents, driving of public culture
activities and external exchange in art, making new efforts to carry forward the traditional culture of China.
59
2020 Annual Report of Songcheng Performance Development Co., Ltd
2. Social responsibility fulfillment regarding targeted poverty alleviation
(1) Plan for Targeted Poverty Alleviation
The Company earnestly responds to the call of the national, provincial and municipal authorities for poverty alleviation by
fully displaying its own advantages and the advantages in industry, and by actively carrying out targeted poverty alleviation work.
(2) Overview of Annual Targeted Poverty Alleviation
During the reporting period, the Company actively responded to the call of the Central Government “to win the battle against
poverty” by carrying out the poverty alleviation work in the field of culture and art. During the reporting period, the Compa ny and
its subsidiaries also participated in public welfare activities such as donation to schools and donation for poverty alleviation.
(3) Result of Targeted Poverty Alleviation
Indicator Measurement Unit Quantity/Implementation
I. Overview —— ——
II. Itemized investment —— ——
1. Poverty alleviation by industry
—— ——
development
2. Poverty alleviation by transfer and
—— ——
employment
3. Poverty alleviation by relocation —— ——
4. Educational poverty alleviation —— ——
5. Health poverty alleviation —— ——
6. Ecological poverty alleviation —— ——
7. Minimum guarantee —— ——
8. Social poverty alleviation —— ——
9. Others —— ——
III. Awards (content and level) —— ——
(4) Plan for Subsequent Targeted Poverty Alleviation
In 2021, the Company will actively respond to the call of the national, provincial and municipal authorities about poverty
alleviation by cooperating with the government departments at all levels to win the battle against poverty alleviation and fu lfilling
the social responsibilities and obligations.
3.Environmental Protection-related Matters
Whether the listed company and its subsidiaries belong to the key pollutant discharging units announced by the environmental
60
2020 Annual Report of Songcheng Performance Development Co., Ltd
protection department
□ Yes √ No
The listed company and its subsidiaries are not the key pollutant discharging units announced by the environmental protection
department.
XVIII. Explanations to Other Significant Matters
□ Applicable √ Not applicable
There were no other significant matters for explanation during the reporting period.
XIX. Major Events of the Company's Subsidiaries
□ Applicable √ Not applicable
61
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section VI Changes in Shares and Information about Shareholders
I. Changes in Shares
1. Changes in shares
Unit: share
Before the change Increase or decrease in the change (+, -) After the change
Shares Shares
Bonus
Number Percentage newly converted from Others Subtotal Number Percentage
shares
issued capital reserves
I. Shares with
limited sales 263,918,107 18.17% 0 0 180,437,715 -38,370,962 142,066,753 405,984,860 15.53%
condition
1.
State-owned 0 0.00% 0 0 0 0 0 0 0.00%
shares
2. Shares
held by
0 0.00% 0 0 0 0 0 0 0.00%
state-owned
legal persons
3. Other
domestic 263,918,107 18.17% 0 0 180,437,715 -38,370,962 142,066,753 405,984,860 15.53%
shares
Including:
Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
domestic legal
persons
Shares held by
263,918,107 18.17% 0 0 180,437,715 -38,370,962 142,066,753 405,984,860 15.53%
domestic
natural persons
4. Foreign
0 0.00% 0 0 0 0 0 0 0.00%
shares
Including:
Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
overseas legal
persons
0 0.00% 0 0 0 0 0 0 0.00%
62
2020 Annual Report of Songcheng Performance Development Co., Ltd
Shares held by
foreign natural
persons
II. Shares
without 1,188,689,693 81.83% 0 0 981,648,525 38,370,962 1,020,019,487 2,208,709,180 84.47%
restrictions
1. RMB
1,188,689,693 81.83% 0 0 981,648,525 38,370,962 1,020,019,487 2,208,709,180 84.47%
ordinary shares
2. Foreign
shares list in 0 0.00% 0 0 0 0 0 0 0.00%
China
3. Foreign
shares listed in 0 0.00% 0 0 0 0 0 0 0.00%
overseas
4. Other 0 0.00% 0 0 0 0 0 0 0.00%
III. Total 1,452,607,800 100.00% 0 0 1,162,086,240 0 1,162,086,240 2,614,694,040 100.00%
Reasons for changes in shares
√ Applicable □ Not applicable
(1) During the reporting period, 38,830,789 shares locked by executives were unlocked, and 459,827 shares locked by
executives were added.
(2) During the reporting period, the Company implemented 2019 equity distribution plan: Taking the total share capital of
1,452,607,800 shares of 2019 as the basis, RMB 2.00 (tax included) of dividend for every 10 shares was distrib uted to all the
shareholders, with a total cash dividend of RMB 290,521,560 and 8 shares capitalized from the capital reserves were distributed to
all the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. Upon such capitalizati on, the total share
capital after conversion amounted to 2,614,694,040 shares.
Approval for changes in shares
√ Applicable □ Not applicable
(1) On April 27, 2020, the 6th meeting of the 7th Board of Directors and the 5th meeting of the 7th Board of Superv isors were
held by the Company, which reviewed and approved the 2019 Proposal on Profit Distribution and Capital Reserve Capitalization. The
proposal on profit distribution and capital reserve capitalization of the Company in 2019 was: Taking the total share capital of
1,452,607,800 shares of 2019 as the basis, RMB 2.00 (tax included) of dividend for every 10 shares was distributed to all the
shareholders, with a total cash dividend of RMB 290,521,560 and 8 shares capitalized from the capital reserves were distributed to
all the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. Upon such capitalization, the total sh are
capital amounted to 2,614,694,040 shares.
(2) On May 18, 2020, the annual shareholders' meeting was held by the Company in 2019, which reviewed and approved the
2019 Proposal on Profit Distribution and Capital Reserve Capitalization.
Transfer for changes in shares
√ Applicable □ Not applicable
During the reporting period, the appropriate procedures for the capitali zed share capital have been completed at Shenzhen
Branch, China Securities Depository and Clearing Corporation Limited.
The progress on share repurchases
63
2020 Annual Report of Songcheng Performance Development Co., Ltd
□ Applicable √ Not applicable
The progress on reduction of re-purchase shares by means of centralized competitive bidding
□ Applicable √ Not applicable
Effects of changes in shares on the basic earnings per share ("EPS"), diluted EPS, net assets per share, attributable to comm on
shareholders of the Company, and other financial indexes over the last year and last period
□ Applicable √ Not applicable
Other contents that the Company considers necessary or are required by the securities regulatory authorities to disclose
□ Applicable √ Not applicable
2. Changes in restricted stocks
√ Applicable □ Not applicable
Unit: share
Number Of Number of Number of Number of
Shares With increased shares unlocked shares with
Name of Limited Sales with limited shares with limited sales Reasons for Proposed date of lifting sales
Shareholder Condition At sales condition limited sales condition at the limited sales restriction
The Beginning in current condition in end of the
Of The Period period current period period
In respect of the shares locked
Huang Shares locked by executives, 75% of the total
163,913,427 131,130,742 295,044,169
Qiaoling by executives shares will be locked at the
beginning of each year
Huang Shares locked
41,181,934 32,945,547 74,127,481 Ibid
Qiaolong by executives
Shares locked
Liu Ping 17,879,482 15,131,274 33,010,756 Ibid
by executives
It shall be executed as per the
Resignation of
Liu Yan 38,741,884 38,741,884 0 regulations on management of
the director
executive shares
Shares locked
Zhang Xian 902,767 722,214 1,624,981 Ibid
by executives
Zhang Shares locked
686,103 548,882 1,234,985 Ibid
Jiankun by executives
Shang Shares locked
343,051 274,440 617,491 Ibid
Lingxia by executives
Chen Shares locked
180,554 144,443 324,997 Ibid
Shengmin by executives
Resignation of It shall be executed as per the
Dong Xin 88,905 88,905
the secretary regulations on management of
64
2020 Annual Report of Songcheng Performance Development Co., Ltd
to the Board executive shares
of Directors
Total 263,918,107 180,897,542 38,830,789 405,984,860 -- --
II. Issuance and listing of securities
1. Securities (excluding preferred share) issued in reporting period
□ Applicable √ Not applicable
2. Explanation on changes in total number of the Company's shares & the structure of shareholders and the
structure of assets and liabilities
□ Applicable √ Not applicable
3. Existing shares held by internal staff of the Company
□ Applicable √ Not applicable
III. Particulars about the shareholders and actual controller
1. Total number of shareholders and their shareholdings
Unit: share
Total number
of preferred
Total number
shareholders Total number of
of common
Total Number (if any) (refer preferred shareholders
shareholders
Of Common to Note 9) (if any) (refer to Note 9)
at the end of
Shareholders whose voting with resumed voting
39,572 previous 53,817 0 0
At The End Of rights have rights at the end of
month before
The Reporting been previous month before
the disclosure
Period recovered at the disclosure date of
date of the
the end of the the annual report
annual report
reporting
period
Shareholding list of shareholders with over 5% shares or top ten shareholders
Number of Pledges or freezings
Number of Number of
shares held
Changes in the shares held shares held
Name of Nature Of Shareholding at the end of
reporting with limited without State Of
Shareholder Shareholder Percentage the Number
period sales limited sales Shares
reporting
conditions condition
period
65
2020 Annual Report of Songcheng Performance Development Co., Ltd
Hangzhou
Songcheng Domestic
Group Non-state-owned 29.48% 770,835,254 342,593,446 0 770,835,254 Pledge 122,400,000
Holdings Co., Legal Person
Ltd
Huang Domestic Natural
11.83% 309,192,225 90,640,989 295,044,169 14,148,056
Qiaoling Person
Hong Kong
Securities Overseas Legal
3.74% 97,849,470 66,514,862 0 97,849,470
Clearing Person
Company Ltd.
Huang Domestic Natural
3.28% 85,836,643 30,927,397 74,127,481 11,709,162
Qiaolong Person
Industrial Bank
Co., Ltd. -
Xingquan
Trend
Investment Others 2.21% 57,764,086 32,388,617 0 57,764,086
Hybrid Type
Securities
Investment
Fund
Domestic Natural
Liu Yan 1.70% 44,553,289 2,897,395 0 44,553,289
Person
One One Two
Combination
of National Others 1.53% 39,889,483 39,889,483 0 39,889,483
Social Security
Fund
Domestic Natural
Liu Ping 1.37% 35,910,758 12,071,448 33,010,756 2,900,002
Person
One Zero Eight
Combination
of National Others 1.22% 32,000,000 32,000,000 0 32,000,000
Social Security
Fund
Puxin
Investment
Overseas Legal
Company - 1.16% 30,416,249 30,416,249 0 30,416,249
Person
Customer
Fund
66
2020 Annual Report of Songcheng Performance Development Co., Ltd
Description of the association Hangzhou Songcheng Group Holdings Co., Ltd and Huang Qiaoling are the controlling
relationship or concerted action shareholder and actual controller of the Company, respectively; Huang Qiaolong and Liu Ping are
of above-mentioned shareholders the related natural persons of the actual controller Mr. Huang Qiaoling.
Shareholding list of top ten shareholders without limited sales condition
Type of shares
Number of shares held without limited sales condition at the end of the
Name of Shareholder Type of
reporting period Number
shares
RMB
Hangzhou Songcheng Group
770,835,254 common 770,835,254
Holdings Co., Ltd
stock
RMB
Hong Kong Securities Clearing
97,849,470 common 97,849,470
Company Ltd.
stock
Industrial Bank Co., Ltd. -
RMB
Xingquan Trend Investment
57,764,086 common 57,764,086
Hybrid Type Securities Investment
stock
Fund
RMB
Liu Yan 44,553,289 common 44,553,289
stock
RMB
One One Two Combination of
39,889,483 common 39,889,483
National Social Security Fund
stock
RMB
One Zero Eight Combination of
32,000,000 common 32,000,000
National Social Security Fund
stock
RMB
Puxin Investment Company -
30,416,249 common 30,416,249
Customer Fund
stock
Industrial Bank Co., Ltd. -
Xingquan New Vision Hybrid Type RMB
Initiated Securities Investment 26,279,865 common 26,279,865
Fund with Flexible Setting and stock
Regular Availability
Industrial and Commercial Bank
RMB
of China - Huitianfu Growth Focus
25,500,081 common 25,500,081
Hybrid Type Securities Investment
stock
Fund
Industrial and Commercial Bank RMB
23,500,000 23,500,000
of China Company Limited - common
67
2020 Annual Report of Songcheng Performance Development Co., Ltd
Huitianfu Blue-chip Hybrid Type stock
Securities Investment Fund with
Stable, Flexible Setting
Explanation on associated
relationship or persons acting in
concert among top ten Hangzhou Songcheng Group Holdings Co., Ltd and Huang Qiaoling are the controlling
shareholders without limited shareholder and the actual controller of the Company, respectively; Huang Qiaolong and Liu Ping
shares, and between top ten are the related natural persons of the actual controller Mr. Huang Qiaoling.
shareholders without limited
shares and top ten shareholders
Whether the Company's top ten common shareholders or top ten common shareholders without limited shares agree on any
repurchase transaction in the reporting period
□ Yes √ No
None of the Company's top ten common shareholders or top ten common shareholders without limited shares agreed on
repurchase in the reporting period.
2. Particulars about the controlling shareholder
Nature of the controlling shareholder: Natural person-owned
Type of the controlling shareholder: legal person
Legal
Name of the controlling Date of
representative/unit Organization Code Main businesses
shareholder establishment
head
Hangzhou Songcheng Group
Wang Pengyu November 21, 1997 91330109255712632Y Industrial investment
Holdings Co., Ltd
Equity interest of other listed
companies, at home and
abroad, controlled and
N/A
jointly controlled by
controlling shareholders
during the reporting period
Change of the controlling shareholders in the reporting period
□ Applicable √ Not applicable
No change has happened to the controlling shareholder in the reporting period of the Company
3. The actual controller of the Company and persons acting in concert
Nature of the actual controller: Domestic natural person
Type of the actual controller: Natural person
Name of the actual Relationship with the actual Whether he/she has obtained the right
Nationality
controller controller of residence in another country or
68
2020 Annual Report of Songcheng Performance Development Co., Ltd
region
Huang Qiaoling Himself China No
Mr. Huang Qiaoling served as the chairman and president of Songcheng Tourism Development Co.,
Ltd from February 1999 to December 2000. He served as the chairman of Hangzhou Songcheng
Main occupation and title Group Holdings Co., Ltd from November 1997 to March 2013. He served as the chairman of
Hangzhou World Leisure Expo Park Co., Ltd from August 2001 to March 2013. He has been serving as
the chairman of this Company since December 2000.
Information about other
listed companies at home
N/A
and abroad controlled in
the last ten years
Change of the actual controller in the reporting period
□ Applicable √ Not applicable
No change has happened to the actual controller in the reporting period
Block Digram for Property Right and Control Relationship between the Company and Actual Controllers
The actual controller controls the Company via trust or other ways of asset management
□ Applicable √ Not applicable
4. Particulars about other corporate shareholders with shareholding proportion over 10%
□ Applicable √ Not applicable
5. Particulars on share reduction restricted for controlling shareholders, actual controller, restructuring party
or other commitment entities
□ Applicable √ Not applicable
69
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section VII Information of Preferred Shares
□ Applicable √ Not applicable
There are no preferred shares in the reporting period.
70
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section VIII Convertible Corporate Bonds
□ Applicable √ Not applicable
There are no convertible corporate bonds in the reporting period.
71
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section IX Directors, Supervisors, Senior Managers and Employees
I. Shareholding Changes of Directors, Supervisors and Senior Management
Number of
Number of Number of
shares Number of
Starting Termination shares held at shares Other
Position increased shares held at
Name Post Gender Age date of Date of the beginning decreased in changes
status in the the end of the
tenure tenure of the period the period (share)
period period
(share) (share)
(share)
Huang June 6, August 8,
Chairman Incumbent Male 63 218,551,236 84,200,000 174,840,989 309,192,225
Qiaoling 2010 2022
Huang June 6, August 8,
Director Incumbent Male 61 54,909,246 13,000,000 43,927,397 85,836,643
Qiaolong 2010 2022
Zhang Director, June 6, August 8,
Incumbent Female 47 1,203,690 962,952 2,166,642
Xian President 2010 2022
Director,
Zhang March August 8,
Executive Incumbent Male 57 914,804 731,843 1,646,647
Jiankun 20, 2013 2022
President
Huang April 26, August 8,
Director Incumbent Male 49
Hongming 2019 2022
Director,
Shang August August 8,
Executive Vice Incumbent Female 46 457,402 365,921 823,323
Lingxia 12, 2013 2022
President
Independent August August 8,
Lanke Incumbent Male 71
Director 21, 2015 2022
Independent August August 8,
Liu Shuzhe Incumbent Male 64
Director 8, 2019 2022
Independent March August 8,
Yu Qinyi Incumbent Female 41
Director 24, 2017 2022
June 6, August 8,
Zhu Hualu Supervisor Incumbent Female 66
2010 2022
Staff August August 8,
Yu Feng Incumbent Female 45
Supervisor 12, 2013 2022
August August 8,
Xu Jie Supervisor Incumbent Female 53 200 160 360
9, 2016 2022
October August 8,
Zheng Qi Vice President Incumbent Male 44
26, 2018 2022
72
2020 Annual Report of Songcheng Performance Development Co., Ltd
Secretary to
the Board of
Chen May 21, August 8,
Directors and Incumbent Male 50 240,739 192,591 433,330
Shengmin 2010 2022
Chief Financial
Officer
Total -- -- -- -- -- -- 276,277,317 0 97,200,000 221,021,853 400,099,170
II. Changes of Directors, Supervisors and Senior Management
□ Applicable √ Not applicable
III. Positions
Professional backgrounds, major work experiences and current main responsibilities in the Company for incumbent directors,
supervisors and senior management of the Company
1. Mr. Huang Qiaoling: 63 years old, senior economist, Chinese nationality, without permanent residency abroad. Mr. Huang
Qiaoling served as Chairman and President of Songcheng Tourism Development Co., Ltd. from February 1999 to December 2000;
From November 1997 to March 2013, he served as Chairman of Songcheng Holdings; From August 2001 to March 2013, he se rved
as Chairman of Hangzhou World Leisure Expo Park Co., Ltd. He has been serving as the chairman of this Company since December
2000.
2. Mr. Huang Qiaolong: 61 years old, college degree, economist, Chinese nationality, without permanent residency abroad. Mr.
Huang Qiaolong served as Vice President and Chairman of Songcheng Holdings from March 2003 to November 2009. He has served
as a director of the Company since December 2000.
3. Ms. Zhang Xian: 47 years old, master degree, a famous person in national publicity and cultural system, with the prestigious
title of "Four Excellency" talent. Chinese nationality, without permanent residency abroad. Ms. Zhang Xian taught initially English
and advanced to become Deputy Director of Nanhu Revolutionary Memorial Hall. In December 2000, she joined Songcheng Group
as Deputy General Manager of Songcheng Holdings; From February 2002 to July 2003, she served as the General Manager of
Songcheng Tourism Management Branch; From August 2003 to February 2007, she served as Vice President of Songcheng Holdings;
From March 2007 to February 2009, she served as Vice President of the Company; From March 2009 to December 2010, she served
as Executive President of the Company; She has served as a director of the Company since June 201 0 and as President of the
Company since December 2010.
4. Mr. Zhang Jiankun: 57 years old, college degree, Chinese nationality, without permanent residency abroad. From October
1994 to April 1999, Mr. Zhang Jiankun served as the director of Songcheng Real Estate Engineering Department; From May 1999 to
February 2002, he served as the Engineering Department Manager of Hangzhou Huamei Science and Technology Education
Investment Co., Ltd.; From March 2002 to February 2004, he served as Deputy General Manager of Songcheng Holding Engineering
Construction Department; From March 2004 to February 2005, he served as Deputy General Manager of Landscape Real Estate;
From March 2005 to February 2006, he served as General Manager of Songcheng Holdings Engineering Department; From March
2006 to February 2009, he served as Vice President of Landscape Real Estate; From March 2009 to February 2012, he served as V ice
President of the Company; From March 2012 to December 2013, he served as Executive Vice President of the Company; He has
been the Executive President of the Company since January 2013 and the director of the Company since February 2013.
5. Mr. Huang Hongming: 49 years old, bachelor degree, senior economist, Chinese nationality, without permanent residency
abroad. Mr. Huang Hongming has been the Deputy General Manager of Songcheng Real Estate Company; Vice Chairman and
President of Hong Kong Jinhui International Investment Group; Since September 2013, he has served as Executive President of
Songcheng Holdings Company, and has served as a director of the Company since April 2019.
73
2020 Annual Report of Songcheng Performance Development Co., Ltd
6. Ms. Shang Lingxia: 46 years old, bachelor degree, Chinese nationality, without permanent residency abroad. Ms. Shang
Lingxia served as the secretary of Chairman of Songcheng Holdings from March 2001 to July 2003; From August 2003 to September
2005, she served as General Manager of Songcheng Tourism Management Subsidiary; From October 2005 to April 2008, she served
as General Manager of Hangzhou World Leisure Expo Park Co., Ltd.; From May 2008 to November 2010, she served as General
Manager of First World Hotel; From December 2010 to December 2017, she served as Vice President of the Company; She has
served as a director of the Company since August 2013 and as Executive Vice President of the Company since January 2018.
7. Mr. Lanke: 71 years old, bachelor degree, professor, Chinese nationality, without permanent residency abroad. Mr. Lanke ha s
been engaged in the research and teaching of Chinese folk culture for fourteen years. In 1989, he wen t to Shenzhen Overseas
Chinese Town to participate in the planning and construction management of the Splendid China Folk Culture Village, and serve d as
General Manager of Happy Valley and the Group's Tourism Development Department; from 2000 to 2003, he w as President of
Songcheng Group; later, he was Vice Chairman and senior advisor of Haichang Group, and has been an independent director of th e
Company since August 2015.
8. Mr. Liu Shuzhe: 64 years old, master degree, senior economist, Chinese nationality, without permanent residency abroad. Mr.
Liu Shuzhe has served as loan officer of Jiande Sub-branch of People's Bank of China, Deputy Head of Xiaoshan Sub-branch of
Industrial and Commercial Bank of China, Chief, Deputy Director and Vice President of Hangzhou Branch of Industrial and
Commercial Bank of China, and has been an independent director of the Company since August 2019.
9. Ms. Yu Qinyi: 41 years old, master degree, Chinese nationality, without permanent residency abroad. From July 2005 to
December 2009, she served as strategic investment consultant of Zhongxin Zhongliang Lianxing Co.,Ltd.; Since January 2010, she
has been a certified public accountant of Zhejiang Herui Certified Public Accountants Co., Ltd., and has been an independent
director of the Company since March 2017.
10. Ms. Zhu Hualu: 66 years old, college degree, Chinese nationality, without permanent residency abroad. From January 1995
to January 2005, Ms. Zhu Hualu served as Art Department Manager, General Manager Assistant and Executive Deputy General
Manager of Hangzhou World City Songcheng Real Estate Co., Ltd., and Vice President of Hangzhou Songcheng Group Holdings Co.,
Ltd.; She has served as Chairman of the Board of Supervisors of the Company since December 2000.
11. Ms. Yu Feng: 45 years old, bachelor degree, Chinese nationality, without permanent residency abroad. Ms. Yu Feng served
as Deputy Manager of Xiaoshan International Hotel from October 1995 to June 2003; From August 2003 to July 2004, she served a s
Deputy Manager of Human Resources Department of Hangzhou Paradise; From August 2004 to November 2006, she served as HR
Manager of Hangzhou Landscape Real Estate Co., Ltd. and HR Manager of Hangzhou World Leisure Expo Park Co., Ltd.; From
December 2006 to April 2011, she served as Director of Human Resources Department and Deputy General Manager of general
manager office of Hangzhou First World Hotel Co., Ltd.; From April 2011 to December 2012, she served as Deputy Director of
Human Resources Department of Hangzhou Songcheng Group Holdings Co., Ltd.; From January 2013 to December 2015, she served
as Director of Hangzhou First World Hotel Co., Ltd. and Deputy General Manager of the administrative office; From January 201 6 to
December 2017, she served as General Manager of Hangzhou Songcheng Tourism Development Co., Ltd.; She has served as
President Assistant of the Company since January 2018, and has served as supervisor of the Company since August 2013.
12. Ms. Xu Jie, 53 years old, assistant ideological and political worker, Chine se nationality, without permanent residency abroad.
From June 1999 to February 2002, Ms. Xu Jie served as Deputy Manager of Real Estate Marketing Department of Hangzhou Xianghu
Green Valley Tourism Development Co., Ltd. From March 2002 to June 2002, she se rved as Deputy Manager of Early Stage
Department of Hangzhou Nandu Songcheng Real Estate Co., Ltd.; From July 2002 to May 2006, she served as Property Manager of
Hangzhou World Leisure Expo Park Co., Ltd.; From June 2006 to December 2008, she served as Pro perty Manager of Hangzhou
Songcheng Landscape Real Estate Co., Ltd.; From February 2009 to December 2010, she served as General Manager Assistant of
Hangzhou Songcheng Group Property Services Co., Ltd.; Since January 2010, she has served as Deputy General Manager of
Hangzhou World Leisure Expo Park Co., Ltd., and since August 2016, she has served as supervisor of the Company.
13. Mr. Zheng Qi: 44 years old, college degree, Chinese nationality, has served as Sales Manager of the mobile phone business
unit of the Market Development Department of China Putian Hangzhou Subsidiary; Manager of Jiangsu and Hubei Regions of
74
2020 Annual Report of Songcheng Performance Development Co., Ltd
Mobile Communications Division of East China Representative Office of Ericsson China Investment Co., Ltd.; General Manager of
Energy Division of Aerospace Communications Holding Group Co., Ltd.; Deputy general manager of Zhejiang Aerospace Electronic
Information Industry Co., Ltd. Since December 2013, he has served as Executive Director and General Manager of Lijiang Chama
Ancient City Tourism Development Co., Ltd, Chairman and General Manager of Aba Zhou Jiuzhai Romance Tourism Development Co.,
Ltd, Director and General Manager of Guilin Lijiang Romance Performance Development Co., Ltd, Director and General Manager of
Jiuzhaigou Tibetan Mystery Culture Co., Ltd and President Assistant of Songcheng Performance Development Co., Ltd, and has
served as Vice President of the Company since October 2018.
14. Mr. Chen Shengmin: 50 years old, college degree, accountant, Chinese nationality, without permanen t residency abroad.
From March 2002 to March 2004, Mr. Chen Shengmin served as the lead accountant of Finance Department of the Leyuan Tourism;
From April 2004 to February 2005, he served as the Finance Manager of the Leyuan Tourism; From March 2005 to Jul y 2007, he
served as Finance Manager of Landscape Real Estate; He has been Chief Financial Officer of the Company since July 2007 and th e
Secretary of the board of directors of the Company since May 2017.
Position held in shareholders entities
√ Applicable □ Not applicable
Remuneration and allowance
Name of shareholder Position held in Starting date Termination Date
Name received from a shareholder entity
entity shareholders entities of tenure of tenure
or not?
Huang Hangzhou Songcheng
Executive Director No
Qiaoling Group Holdings Co., Ltd
Huang Hangzhou Songcheng
Supervisor No
Qiaolong Group Holdings Co., Ltd
Huang Hangzhou Songcheng
Executive President Yes
Hongming Group Holdings Co., Ltd
Position held in other entities
√ Applicable □ Not applicable
Position held in other Starting date Termination Renumeration received
Name Name of other entity
entities of tenure Date of tenure from other entity or not
Zhejiang Herui Certified Public Certified Public
Yu Qinyi Yes
Accountants Co., Ltd. Accountant
Bank of Hangzhou, CHINT Electrics Co.,
Liu
Ltd., Hangzhou GREENDA Electronic Independent Director Yes
Shuzhe
Materials Co., Ltd.
Deputy General
Hangzhou World Leisure Expo Park Co.,
Xu Jie Manager and Yes
Ltd
Supervisor
Incumbent or outgoing directors, supervisors and senior management in the reporting period that have been imposed
administrative penalties by CSRC in the last three years
□ Applicable √ Not applicable
75
2020 Annual Report of Songcheng Performance Development Co., Ltd
IV. Remuneration of Directors, Supervisors and Senior Management
The following describes the decision-making program, determination basis and actual payment of remuneration for directors,
supervisors and senior management.
Procedures for making decisions on the remuneration of directors, supervisors and senior management personnel:
remuneration of directors and supervisors is determined by the general meeting of shareholders, while remuneration of senior
managers is determined by Board of Directors. Directors, supervisors and senior management personnel who perform their duties
in the Company receive remuneration according to specific positions.
Basis for determining the remuneration of directors, supervisors and senior management personnel: The remuneration of
directors, supervisors and senior management personnel shall be determined and distributed according to the Working Rules of
Remuneration and Appraisal Committee of the Board of Directors of the Company, and based on the Company's operating
performance, their own performance, work ability, post responsibilities and other assessments.
Actual payment of the remuneration of directors, supervisors and senior management personnel: RMB 3,808,500
Remuneration of directors, supervisors and senior management in the reporting period of the Company
Unit: ten thousand RMB
Position Total remuneration from the Whether to receive remuneration
Name Post Gender Age
status Company before tax from related parties or not
Huang
Chairman Male 63 Incumbent 62.85 No
Qiaoling
Huang
Director Male 61 Incumbent Yes
Qiaolong
Zhang Xian Director, President Female 48 Incumbent 62.85 No
Zhang Director, Executive
Male 57 Incumbent 56.81 No
Jiankun President
Huang
Director Male 49 Incumbent Yes
Hongming
Director, Executive Vice
Shang Lingxia Female 46 Incumbent 53.25 No
President
Lanke Independent Director Male 71 Incumbent 5 No
Liu Shuzhe Independent Director Male 64 Incumbent 5 No
Yu Qinyi Independent Director Female 41 Incumbent 5 No
Chairman of the Board
Zhu Hualu Female 66 Incumbent 5 No
of Supervisors
Yu Feng Staff Supervisor Female 45 Incumbent 33.23 No
Xu Jie Supervisor Female 53 Incumbent Yes
Zheng Qi Vice President Male 44 Incumbent 48.96 No
Chen CFO and Secretary of
Male 50 Incumbent 42.9 No
Shengmin the Board
Total -- -- -- -- 380.85 --
76
2020 Annual Report of Songcheng Performance Development Co., Ltd
Share incentives for the Company's directors, supervisors and senior executives in the reporting period
□ Applicable √ Not applicable
V. Employees in the Company
1. Number, profession composition and educational background of the employees
Number of incumbent employees in the parent company
143
(person)
Number of incumbent employees in major subsidiaries (person) 1,298
Total number of incumbent employees (person) 1,441
Number of employees receiving salaries in current period
1,441
(person)
Number of retired employees requiring the parent company and
0
major subsidiaries to bear their costs
Profession composition
Type of profession composition Number of employees for profession composition (person)
Production personnel 451
Salesperson 94
Technical personnel 253
Financial personnel 85
Administrative personnel 75
Executive personnel 192
Service personnel 291
Total 1,441
Educational background
Type of educational background Number of employees (person)
Junior high school and below 110
High school/technical secondary school 313
Junior college 556
Bachelor 437
Master and above 25
Total 1,441
2. Remuneration policies
The Company set up an extensive "H" broadband salary system, which not only provides a promotion channel and platform
for management positions, but also encourages employees to get salary rises through improvement of their skills and
77
2020 Annual Report of Songcheng Performance Development Co., Ltd
professionalism. We evaluate and adjust employees’ salaries based on the Company's operating performance, employees’ appraisal
results, work performance, social and economic developments, price level and regional differences, and advocate a salary
confidentiality system.
Salary is composed of post salary, various subsidies, benefits and bonuses. The salary of management personnel consists of
basic salary, post salary, performance salary and allowance; the salary of employee-level positions consists of basic salary,
performance salary and allowance. Among them, the basic salary and performance salary are verified according to the management
level and performance appraisal scheme, and the performance salary of employees is closely linked with the Company's operatin g
performance. The post salaries for the management personnel at supervisor level or above are determined according to their
management level.
3. Training plan
(1) The Company is committed to building a comprehensive talent training system and a scientific talent promotion
mechanism to help the Company achieve its strategic goals and continuously improve the all-round ability of its employees. The
Company provides employees with professional development opportunities, and continuously provides key employees and middle
and senior managers who conform to Songcheng's corporate culture and possess excellent professional skills and management
talents for new projects, which not only provides a platform for talent growth, but also facilitates the healthy development of the
Company. The cultivation and promotion of talents are the main components of the annual KPI for each manager of the Company
and also an important part in assessing the responsibility system of annual business objectives of the company. The Company
attaches great importance to the cultivation of talents, and gives notices of praise and material rewards to subsidiaries that have
made outstanding contributions to the cultivation of talents.
(2) The Company has established a sound staff training system and internal trainer training system, and has formulated
targeted training programs such as "Induction Training", "Job Skills Training", "General Skills Training" , "Professional Skills Upgrading
Training", "Professional Skills Upgrading Training", "Management Skills Training", "Internal Trainer Training (TTT)", "Songcheng Star
Training Class ", "Artistic Performance and Management", and intensive training classes within each vertical management syste m.
Especially, the "Songcheng Star Training Class" focuses on training excellent managers and outstanding backbone personnel for the
Company, and a number of management backbone personnel have taken up important management positions. The Company has
established ten vertical management systems, held vertical management meetings regularly, and carried out various forms of
training every year to improve the business and management skills of their employees within the system. Each vertical departm ent
of the Group regularly visits each subordinate company for work inspection every year. In addition to such inspections, the excellent
work experience and cases of each company are also shared within the system. The Company continued to carry out various forms
of talent selection examinations and training programs in 2020 to reserve vari ous types of management-oriented talents for the
Company's strategic objectives.
(3) The Company helps the growth of talents through a combination of internal and external trainings. We have cooperated
with many external professional training institutions to constantly update and strengthen the professional knowledge and practical
skills of our talents in administration, human resources, finance and taxation, marketing, planning, business and management.
Moreover, the Company has set up "Songcheng Group Network College" to create a good learning atmosphere for internal
employees to attend online training anytime and anywhere, and the Company also encourages each department to use the
excellent courses broadcast live on the Internet for internal trainings. The Company also encourages employees to improve their
academic qualifications and participate in professional title and qualification examinations.
(4) The Company has held a variety of theme activities such as "Skills Competition", "Excellent Staff and Man agement Travel
Inspection", "Employee Outward Bound", "Staff Four Seasons Theme Activities" and "Internal Trainer Salon Activities" to enric h its
78
2020 Annual Report of Songcheng Performance Development Co., Ltd
training programs. All skill competition programs, especially the annual skill competition, serve to improve t he business skills and
comprehensive skills of employees. Through business skills competition, debate competition, host competition, poetry competition,
work innovation and other projects, the Company cultivates talents who can "do, speak, write and innovate".
(5) The Company registered an official corporate culture publicity account named "Songcheng people" on WeChat, so as to
display various corporate culture activities organized by the Company to employees, and strengthen the publicity of award -winning
employees such as "the Most Beautiful Songcheng people", "Star Employees" and "Excellent Interns", thus creating an excellent
corporate culture atmosphere and advocating all employees to achieve excellence. Employees can also leave messages on WeChat,
and any suggestions and opinions about the Company can be sent to the chairman's mailbox. In addition, the Company shall
strengthen the interaction and communication between its management and the employees, and implement excellent and feasible
suggestions put forward by employees. The WeChat account also has the function of points exchange, employees who have signed
in may redeem the corresponding prizes, enabling the employees to focus on and recognize the Company's corporate culture.
4. Labor outsourcing
√ Applicable □ Not applicable
Total hours of labor outsourcing (hours) 1,210,380
Total remuneration paid for labor outsourcing (RMB) 23,844,490.08
79
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section X Corporate Governance
I. Basic Situation on Corporate Governance
During the reporting period, the Company further improved its corporate governance structure, standardized its operations
and enhanced its corporate governance in strict compliance with the requirements of the Company Law, the Securities Law, the
Code of Corporate Governance of Listed Companies, the Stock Listing Rules of the Shenzhen Stock Exchange, the Rules Governing the
Listing of Stocks on the Growth Enterprise Market of the Shenzhen Stock Exchange and the Requirements of CSRC on relevant laws
and regulations. As at the end of the reporting period, the actual situation of the Company's governance was basically in
compliance with the normative documents issued by the CSRC on the governance of listed companies.
1. About Shareholders and Shareholders’ Meetings
The Company convenes and holds shareholders' meetings in strict accordance with the provisions and requirements of the
Rules for General Meetings of Listed Companies, the Articles of Association and the Rules of Procedure for General Meetings, so as
to ensure that all shareholders, in particular the minority shareholders are treated fairly, and fully exercise their rights.
2. About the Company and the Controlling Shareholders
The Company has independent business and operation ability, and is independent of the controlling shareholder in terms of
business, personnel, assets, institutions and finance, and the Company's Board of Directors, Board of Supervisors and interna l
institutions operate independently. The controlling shareholders of the Company can strictly regulate their own conduct and have
not interfered directly or indirectly with the decision-making and operation activities of the Company beyond the shareholders’
meetings or the Board of Directors of the Company.
3. About the Directors and the Board of Directors
The Company elects directors in strict accordance with the selection and appointment procedures stipulated in the Articles of
Association; the Board of Directors of the Company has nine directors, including three independent directors, accounting for
one-third of all directors, and the number and composition of the Board of Directors are in compliance with laws and regulations
and the requirements of the Articles of Association. All directors of the Company shall carry out their work in accordance with the
Rules of Procedure of the Board of Directors and the Management System of Independent Directors, attend the board meetings and
shareholders' meetings timely, actively participate in relevant professional training and familiarize themselves with relevant laws
and regulations.
4. About the Supervisors and Board of Supervisors
The Company shall select supervisors in strict accordance with the relevant provisions of the Company Law and the Articles of
Association, etc. The Board of Supervisors of the Company has three supervisors, including one staff supervisor, and the number
and composition of the Board of Supervisors are in compliance with the requirements of laws and regulations. The supervisors of
the Company are able to perform their duties conscientiously in accordance with the requirements of the Rules of Procedure of the
Board of Supervisors, etc., and effectively supervise and express independent opinions on the Company’s major matters, connec ted
transactions, financial position, performance of duties of directors and managers.
5. Performance Evaluation & Incentive and Restraint Mechanism
The Company has gradually established a fair and transparent performance evaluation standards and incentive and restraint
80
2020 Annual Report of Songcheng Performance Development Co., Ltd
mechanisms for directors, supervisors and senior management (managers), and the appointment of senior management (managers)
of the Company is open and transparent and in compliance with the laws and regulations.
6. Relevant stakeholders
The Company fully respects and safeguards the legitimate rights and interests of relevant stakeholders and achieves a
coordinated balance of the interests of society, shareholders, the Company and employees to jointly promote the sustainable a nd
sound development of the Company.
7. Information Disclosure and Transparency
The Company has designated the Secretary of the Board of Directors as the person in charge of investor relations management
of the Company, who is responsible for management of information disclosure and investor relations of the Compa ny and reception
of visits and inquiries from shareholders; designated Securities Times, Securities Daily and Cninfo as the newspapers and website for
information disclosure of the Company, disclosing information truthfully, accurately and timely in strict accordance with the relevant
laws and regulations and ensuring that all shareholders have fair opportunities access to information.
Whether the actual status of corporate governance significantly deviates from the regulatory documents issued by the China
Securities Regulatory Commission regarding the governance of listed companies.
□ Yes √ No
There is no significant difference between the actual situation of corporate governance and the regulatory documents on the
governance of listed companies issued by China Securities Regulatory Commission.
II. The company's independence from the controlling shareholders in business, personnel, assets,
organization, finance, etc.
Since establishment, the Company has been operating in strict accordance with the requirements of the Company Law, the
Securities Law and other relevant laws and regulations and Articles of Association, and is independent of each other in terms of
business, assets, personnel, organization and finance, and there is no situation in which the Company cannot guarantee its
independence and maintain its ability to operate independently from its controlling shareholder in terms of business, personnel,
assets, organization and finance.
III Horizontal competition
□ Applicable √ Not applicable
IV. Relevant Situation of the Annual General Meeting of Shareholders and the Extraordinary
General Meeting of Shareholders Held in the Reporting Period
1. The shareholders' meetings for this reporting period
Percentage of Date of Date of
Conference Session Conference Type Disclosure Index
Investors Involved Conference Disclosure
Shareholders' General Annual General Monday, May Monday, May
58.04% http://www.cninfo.com.cn/
Meeting in 2019 Meeting 18, 2020 18, 2020
81
2020 Annual Report of Songcheng Performance Development Co., Ltd
2. Convening of the interim shareholders' general meetings upon request of the preferred stockholders whose
voting rights are restored
□ Applicable √ Not applicable
V. The performance of the duties of independent directors during the reporting period
1. Attendance of independent directors in the board of directors and shareholders' meeting
Attendance of independent directors at the BOD meeting and shareholders' general meetings
Number of Whether absent
Number of Number of Number of
board Number of attendance Number of from board
Name of on-site attendance of attendance of
meetings to of board meetings by absence at meetings in
independent attendance of board shareholders'
attend during means of board person for two
director board meetings by general
the reporting telecommunications meetings consecutive
meetings entrusts meetings
period times
Lanke 5 5 No 1
Liu Shuzhe 5 5 No 1
Yu Qinyi 5 5 No 1
2. Objections of independent directors to related issues of the company
Whether the independent directors challenge the company's related issues?
□ Yes √ No
During the reporting period, independent directors did not raise objections to the company's related matters.
3. Other information on independent directors' performance of duties
Whether independent director's proposals on the company issues are accepted
√ Yes □ No
Note on the acceptance or rejection of independent director's proposals on company issues.
During the reporting period, all reasonable suggestions put forward by the independent directors to the Company have been
adopted.
VI. Performance of duties of the special committee under the board of directors during the
reporting period
1. Performance of Duties by the Audit Committee
According to the Rules of Work of the Audit Committee of the Board of Directors of the Company, the Audit Committee has
given full play to its role of audit and supervision and is mainly responsible for financial supervision and verification wor k of the
Company, as well as the communication and coordination with external auditors. The Audit Committee verified the internal control
of the Company in 2020 and considered that the internal control system already established by the Company is in compliance wi th
82
2020 Annual Report of Songcheng Performance Development Co., Ltd
the relevant regulations and can effectively control the relevant risks. In 2020, the Audit Committee focused on the Company's
periodic financial reports, production and operation control, use of funds raised, and capital appropriation by controlling
shareholders and related parties. The Audit Committee conducted a summary and evaluation of the work of the accounting firm
engaged in the annual audit of the Company, and put forward the suggestion of renewing the employment of the accounting firm.
2. Performance of Duties of the Remuneration and Appraisal Committee
During the reporting period, the Remuneration and Appraisal Committee of the Board of Directors of the Company diligently
performed its duties in accordance with relevant regulations and the provisions of the Articles of Association and the Rules of
Procedure of the Remuneration and Appraisal Committee of the Board of Directors, and reviewed matters such as the remuneratio n
of directors and senior management in 2020.
3. Performance of Duties by the Nomination Committee
During the reporting period, the Nomination Committee of the Board of Directors actively performed its duties in accordance
with relevant regulations and the provisions of Articles of Association and Rules of Procedure of the Nomination Committee of the
Board of Directors, and put forward feasible guidance and requirements for construction of a talent team for sustainable
development of the Company.
4. Performance of Duties by the Strategy Committee
During the reporting period, the Strategy Committee of the Board of Directors reviewed and summarized the implementation
of the Company's strategy in accordance with relevant regulations and the provisions of Articles of Association and Rules of
Procedure of the Strategy Committee of the Board of Directors, and timely conducted a study on strategic planning according to the
market situation and the industry in which the Company is engaged in, and put forward reasonable suggestions on implementatio n
of the development strategy according to the actual situation of the Company.
VII. Work of the Board of Supervisors
Has Board of Supervisors discovered any risk in the company during the supervision in the reporting period
□ Yes √ No
The Board of Supervisors of the Company has no objection to the supervision matters during the reporting period.
VIII. Evaluation and Incentive Mechanisms for Senior Management
In accordance with Remuneration Management System for Directors, Supervisors and Senior Management, the Company has
established a performance appraisal and incentive and restraint mechanism linking the remuneration of senior management with
the Company's performance, and the Company has implemented a remuneration system combining basic annual salary and
year-end performance appraisal for senior management.
Based on the achievement of the Company's annual operating objectives and the performance of senior management, the
Remuneration and Appraisal Committee of the Board of Directors conducts annual performance appraisal of senior management
and supervises the implementation of the remuneration system. The Company, in turn, pays their annual performance salary and
provides rewards and punishments based on the results of the performance appraisal. The Remuneration and Appraisal Committee
of the Board of Directors of the Company, after assessing the senior management of the Company based on the actual situation,
unanimously agreed that the remuneration plan of the senior management of the Company for the year 2020 has strictly
implemented the remuneration management system of the Company.
83
2020 Annual Report of Songcheng Performance Development Co., Ltd
IX. Internal Control Assessment Report
1. Details of material weakness in internal control found during the reporting period
□ Yes √ No
2. Internal control self-evaluation report
Date of full-text disclosure for
internal control assessment Thursday, April 22, 2021
report
Full-text disclosure index for
For details, see 2020 Annual Internal Control Self-Evaluation Report published by the company on
internal control assessment
http://www.cninfo.com.cn on April 22, 2021
report
Percentage of total asset from
units included in the
assessment out of the total
63.24%
asset from the company's
consolidated financial
statements
The proportion of operating
income of parties included in
the assessment to the
79.38%
operating income from the
Company's consolidated
financial statements
Defect identification criteria
Category Financial Report Non-financial reports
A material deficiency in internal control The Company is deemed to have a material deficiency
over financial reporting is considered to in internal control not related to financial reporting if
exist if: the following circumstances occur:
(1) The Company's control environment is (1) The Company's operating activities seriously violate
ineffective; national laws and regulations;
(2) Fraud by any of the directors, (2) Unscientific decision-making procedures, resulting
supervisors and senior management; in major mistake in decision-making, which causes
Qualitative standards
(3) The Certified Public Accountant finds significant property losses to the Company;
that there is a material misstatement in (3) Significant loss of key management personnel or
the current financial report, however, the technical personnel;
Company's internal control fails to detect (4) Frequent occurrence of negative news or reports,
such misstatement in the course of which aroused great concern of regulatory authorities
operation; and cannot be eliminated in a long period of time.
(4) Ineffective supervision of internal Significant deficiency: A deficiency that, alone or in
84
2020 Annual Report of Songcheng Performance Development Co., Ltd
control by the Company's Audit combination with other deficiencies, is less serious
Committee and internal audit department. than a material deficiency but may still cause the
Significant deficiency: A deficiency that, Company to deviate from its control objectives.
alone or in combination with other General deficiency: Other internal control deficiencies
deficiencies, is less serious than a material that do not constitute a material deficiency or a
deficiency but may still cause the significant deficiency.
Company to deviate from its control
objectives.
General deficiency: Other internal control
deficiencies that do not constitute a
material deficiency or a significant
deficiency.
Potential misstatement of total profits, Property losses caused by deficiencies, material
material deficiency: misstatement ≥ 5% of deficiency: property losses caused by deficiencies ≥ 5%
total profits; significant deficiency: 2% of of total profits; significant deficiency: 2% of total
Quantitative standards
total profits ≤ misstatement < 5% of total profits ≤ property losses caused by deficiencies < 5% of
profits; general deficiency: misstatement < total profits; general deficiency: property losses caused
2% of total profits by deficiencies < 2% of total profits
Number of material weakness
0
in financial reports
Number of material weakness
0
in non-financial reports
Number of significant
0
deficiency in financial reports
Number of significant
deficiency in non-financial 0
report
X. Internal Control Audit Report or Assurance Report
Internal Control Assurance Report
Deliberations Paragraph in the Internal Control Assurance Report
In our opinion, your company has maintained effective internal control related to financial statements in all major aspects i n
accordance with the Basic Norms of Enterprise Internal Control and relevant regulations promulgated by the five ministries
including the Ministry of Finance as at December 31, 2020. This conclusion was formed under the inherent limitations indicate d in
the assurance report.
Disclosure in the Internal Control
Disclosure
Assurance Report
Date of full-text disclosure for the
Thursday, April 22, 2021
internal control assurance report
Full-text disclosure index for the For details, please refer to the Internal Control Assurance Report of Songcheng Performance
85
2020 Annual Report of Songcheng Performance Development Co., Ltd
internal control assurance report Development Co., Ltd published by the company on http://www.cninfo.com.cn on April 22,
2021
Opinion type in the internal control
Standard unqualified opinion
assurance report
Whether there are material
deficiencies in the non-financial No
reports
Whether the accounting firm has issued an internal control assurance report with modified opinions
□ Yes √ No
Whether the opinions in the internal control assurance report issued by the accounting firm are consistent with those in the
self-evaluation report issued by the board of directors
√ Yes □ No
86
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section XI Corporate Bonds
Whether the Company has corporate bonds which have been publicly issued and listed on the stock exchange and have not
matured or are not fully redeemed at the approval date of annual report
No
87
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section XII Financial Report
I. Audit Reports
Audit opinion type Standard Unqualified Opinion
Signature Date of audit report Thursday, April 22, 2021
Name of audit institution BDO China Shu Lun Pan CPAs (special general partnership)
Audit report ref. Xin Kuai Shi Bao Zi [2021] No.ZA11461
Name of Certified Public Accountant Ni Yilin, Jiang Xuelian
Audit Report Text
Xin Kuai Shi Bao Zi [2021] No.ZA11461
To the shareholders of Songcheng Performance Development Co., Ltd：
I Opinion
We audited the financial statements of Songcheng Performance Development Co., Ltd. (hereinafter referred to as
Songcheng Performance), including the consolidated and parent company Balance Sheet as of December 31, 2020, as well as the
consolidated and parent company income Statement, consolidated and parent company Cash Flow Statement, consolidated and
parent company Statement of Shareholder's Equity Changes, and notes to relevant financial statements in 2020.
In our opinion, the attached financial statements are prepared in accordance with "Accounting Standards for Business
Enterprises" in all major aspects, and fairly reflect the financial situation of the merger and the parent company of Songche ng
Performance as of December 31, 2020, as well as the operating situation and cash flow of Songcheng Performance and its parent
company in 2020.
II Basis for Our Opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants in China. The section of
“CPA's Responsibility for Auditing Financial Statements” in the audit report further elaborates on our responsibilities under these
standards. In accordance with "Code of Professional Ethics for Certified Public Accountants in China", we are independent of
Songcheng Performance and have fulfilled other responsibilities of professional ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our audit opinions.
III Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial stateme nts as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
The key audit matters identified during the audit are summarized as follows:
Key Audit Matters How the matter was addressed in the audit
(I) Recognition of revenue
Since January 1, 2020, the company has implemented the The main audit procedures we performed for revenue
"Accounting Standards for Business Enterprises No. recognition include:
14-Revenue" (hereinafter referred to as the "New Revenue 1. Understand and evaluate the design and operation
Standards") revised by the Ministry of Finance in 2017. The effectiveness of internal control related to revenue recognition
Operating Income of Songcheng Performance is mainly from of the company;
88
2020 Annual Report of Songcheng Performance Development Co., Ltd
cultural and artistic live performances. 2. Check the contracts of the company, identify the contract
terms and conditions related to the recognition of Operating
According to Note 5 (27) of the financial report, the specific Revenue, and evaluate if revenue recognition of the company
principles for recognition of revenue from cultural and meets the requirements of the new revenue standards;
artistic live performances are as follows: The company 3. Perform letter verification procedures to verify the Account
provides scenic spots and live performance services. Receivable balance and Sales Revenue amount for authenticity
Different ticket prices are set according to the types of and completeness;
tourists. Tourists have right to watch live performances at 4. Verify the company revenue for accuracy and completeness by
the scenic spot after purchasing tickets and entering the checking the records of the business system or order records
scenic spots. When the ticket amount has been collected or from third-party platform;
the right to receive payment has been obtained, the revenue 5. Perform analysis on Operating Revenue, and ensure logical
should be generated. rationality of revenue recognition based on the amount of
Operating Revenue, cash flow, and taxes. Analyze reasons for
In 2020, the revenue of cultural and artistic live abnormal changes by comparing revenue over the same period.
performances was RMB 636,915,500, accounting for 70.57% 6. Check the supporting documents related to revenue
of the consolidated total income. Since revenue is one of key confirmation by sampling, including: system orders, admission
performance indicators of the company, there may be orders, receipts, gate records, ticketing records and other
inherent risks of the management manipulating revenue documents to evaluate the occurrence, authenticity and
recognition in order to achieve specific goals or targets. For deadline of Operating Revenue.
this reason, we take revenue recognition as a key issue for
audit.
(2) Long-term Equity Investment Impairment test of Beijing Huafang Technology Co., Ltd.
Our audit procedures for testing of Long-term Equity
As listed in Note 7 (8) of the consolidated financial Investments Impairment mainly include:
statements, as of December 31, 2020, the company's 1. Understand and evaluate the effectiveness of the company
Long-term Equity Investment in Beijing Huafang Technology internal control design and implementation related to Long-term
Co., Ltd. was originally valued at RMB 3,354,224,700, and Equity Investments Impairment;
provision for Long-term Equity Investment Impairment of 2. Understand and evaluate the operating result and financial
RMB 1,861,297,300 was made in the current period, with position of the invested company, discuss with the management
book value of RMB 1,492,927,400. to understand and evaluate the methods used in the testing of
In our opinion, the amount of Long-term Equity Long-term Equity Investments Impairment, including the
Investments Impairment has a significant impact on the reasonableness of the assumptions such as future revenue
financial statements. The management is required to make forecast and cash flow discount rate , judgment and evaluation
significant judgments based on evaluation and testing. of profitability of the components;
Therefore, we recognize the impairment assessment of this 3. Understand and evaluate the assessment specialists, hired by
asset as a key issue for audit. the management, for their competence, professionalism and
objectivity;
89
2020 Annual Report of Songcheng Performance Development Co., Ltd
4. We hired external assessment specialists to assist us to review
impairment testing. We have considered their competence,
professionalism and objectivity;
5. We evaluated whether the evaluation method of Long-term
Equity Investments Impairment test was reasonable;
6. We evaluated whether the key assumptions of Long-term
Equity Investments Impairment test were appropriate;
7. We evaluated whether the calculation process of forecasting
future net cash flow and the selection of discount rate
calculation model were reasonable during Long-term Equity
Investment Impairment test.
IV Other Information
The management of Songcheng Performance (hereinafter referred to as "the management") is responsible for other
information. Other information includes the information covered in annual report of Songcheng Performance of Year 2020, but the
financial statements and our audit report are excluded.
Our opinion on the financial statements does not cover the other information and we do not and will not express any form
of assurance conclusion thereon.
In combination with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the
audit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
V Responsibilities of Management and Those Charged with Governance for the Financial Statements
The Management is responsible for preparing the financial statements in accordance with the requirements of Accounting
Standards for Business Enterprises to achieve a fair presentation, and for designing, implementing and maintaining necessary
internal control to ensure that the financial statements are free from material misstatements, whether due to frauds or errors.
In preparing the financial statements, the management is responsibl e for evaluating the ability of going concern of
Songcheng Performance, disclosing the matters related to going concern (if applicable), and applying the going concern
assumptions, unless there is a plan for liquidation, operations are terminated or there is no other realistic option .
The management is responsible for monitoring the financial reporting process of Songcheng Performance
VI CPA's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an audit report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with the audit standards will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individuall y or in
the aggregate, they could reasonably be expected to influence the economic decisions of users made on the basis of these financial
statements.
As part of an audit in accordance with the audit standards, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provi de a
basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from err or,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design appropriate audit procedures, but
not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
90
2020 Annual Report of Songcheng Performance Development Co., Ltd
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by the Management.
(4) Conclude on the appropriateness of using the going concern assumption by the Management. At the same time, based
on the obtained audit evidence, a conclusion can be drawn on whether there are material uncertainties in matters or circumstances
that may cause significant doubt on going concern ability of Songcheng Performance. If we conclude that a material uncertaint y
exists, we are required to draw attention in our audit report to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the information available up to the date of o ur
audit report. However, future events or circumstances may cause Songcheng Performance unable to continue its operations.
(5) Evaluate the overall presentation (including the disclosures), structure and content of the financial statements, and
whether the financial statements fairly reflect the relevant transactions and events.
(6) Obtain sufficient and appropriate audit evidence on financial information of entities or business activities of Songcheng
Performance, and issue an audit opinion on consolidated financial statements . We are responsible for guiding, supervising and
implementing the group audit, and remain solely responsible for our audit opinion.
We have communicated with those charged with governance on such matters as the scope of audit as planned, the
schedule and material audit findings, including the defects in the internal control that are worth paying attention to found in this
audit.
We have also provided those charged with governance with a statement on observing the professional ethics related to
independence, and communicated with those charged with governance on all the relationships and other matters that might be
reasonably deemed to affect our independence, and relevant preventative measures.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We descr ibe
these matters in our audit report unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public interest benefits of such communication.
(No text below)
BDO China Shu Lun Pan CPAs
Certified Public Accountant:
(Special general partnership) (Project partner)
Certified Public Accountant:
Shanghai, China April 22, 2021
91
2020 Annual Report of Songcheng Performance Development Co., Ltd
II. Financial Statements
Units of financial reports in the notes: yuan
1. Consolidated Balance Sheet
Prepared by: Songcheng Performance Development Co., Ltd.
December 31, 2020
Unit: RMB
Item December 31, 2020 December 31, 2019
Current Assets:
Cash and Bank Balances 1,337,776,253.98 1,785,124,821.87
Deposit Reservation for Balance
Loans to Banks and Other
Financial Institutions
Trading Financial Assets 335,217,557.68 854,108,086.54
Derivative Financial Assets
Note’s receivable
Accounts receivable 5,887,012.36 5,337,855.43
Receivables Financing
Prepayments 21,934,226.54 17,221,603.54
Premium Receivable
Reinsurance Accounts Receivable
Reinsurance Contract Reserves
Receivable
Other Receivables 50,524,990.69 125,573,266.78
Including: interest receivable
Dividends Receivable
Buying Back the Sale of Financial
Assets
Inventory 13,424,146.50 6,110,221.56
Contract Assets
Holding for-sale assets
Non-current Assets Due within 1
Year
Other Current Assets 148,641,404.47 127,570,975.96
Subtotal of Current Assets 1,913,405,592.22 2,921,046,831.68
92
2020 Annual Report of Songcheng Performance Development Co., Ltd
Non-current Assets:
Granting of loans and advances
Investment in Creditor's Rights
Investment in Other Creditor's
Rights
Long-term Receivables
Long-term Equity Investment 1,534,539,625.11 3,468,596,165.08
Investment in Other Equity
224,266,596.74 300,959,931.64
Instruments
Other Non-current Financial
Assets
Investment Property
Fixed Assets 2,508,754,929.16 2,311,251,277.89
Projects under Construction 771,871,563.73 370,000,233.10
Productive Biological Assets
Oil and gas assets
Right-of-use Assets
Intangible Assets 1,880,031,922.56 1,498,490,129.82
Development Expenditure
Goodwill 11,655,794.87 28,078,665.69
Long-term unamortized expenses 323,741,176.89 112,440,627.02
Deferred Income Tax Assets 18,485,803.52 9,148,452.39
Other Non-current Assets 8,589,826.26 21,064,619.27
Subtotal of Non-current Assets 7,281,937,238.84 8,120,030,101.90
Total Assets 9,195,342,831.06 11,041,076,933.58
Current Liabilities:
Short-term loan
Borrowings from the Central Bank
Borrowings from Banks and Other
Financial Institutions
Transactional financial liabilities
Derivative Financial Liabilities
Notes Payable
Accounts Payable 372,476,464.69 300,656,879.62
Received Prepayments 12,888,689.05 351,733,456.28
93
2020 Annual Report of Songcheng Performance Development Co., Ltd
Contract liabilities 188,550,237.52
Financial Assets Sold for
Repurchase
Deposit Taking and Interbank
Deposit
Receiving from Vicariously Traded
Securities
Receiving from Vicariously Sold
Securities
Payroll payable 18,817,804.74 26,737,888.43
Tax Payable 19,869,808.49 22,614,171.64
Other Payables 65,149,971.79 63,299,348.02
Including: interest payable
Dividends Payable
Service Charge and Commission
Payable
Reinsurance Accounts Payable
Holding for-sale liabilities
Non-current Liabilities Due within
12,426,708.33
1 Year
Other Current Liabilities 3,513,902.08
Subtotal of Current Liabilities 693,693,586.69 765,041,743.99
Non-current Liabilities:
Insurance Contract Reserves
Long-term loan 282,000,000.00
Bonds Payable
Including: Preferred Stocks
Perpetual Bonds
Lease Liabilities
Long-term Payables
Long-term payroll payable
Expected Liabilities
Deferred Income 387,619,860.41 382,872,318.90
Deferred Income Tax Liabilities 96,769,220.18 10,771,548.18
Other Non-current Liabilities
Subtotal of Non-current Liabilities 766,389,080.59 393,643,867.08
94
2020 Annual Report of Songcheng Performance Development Co., Ltd
Total Liabilities 1,460,082,667.28 1,158,685,611.07
Shareholders' Equity:
Share Capital 2,614,694,040.00 1,452,607,800.00
Other Equity Instruments
Including: Preferred Stocks
Perpetual Bonds
Capital Reserves 1,211,364,214.86 2,476,312,069.09
Less: Treasury Share
Other Comprehensive Incomes -63,325,115.75 -8,681,151.59
Special Reserves
Surplus Reserves 517,673,268.35 517,673,268.35
General Risk Reserves
Undistributed Profits 3,131,881,024.60 5,176,157,180.79
Total Shareholders' Equity Attributable
7,412,287,432.06 9,614,069,166.64
to the Parent Company
Minority Shareholders' Equity 322,972,731.72 268,322,155.87
Total Shareholders' Equity 7,735,260,163.78 9,882,391,322.51
Total Liabilities and Shareholders'
9,195,342,831.06 11,041,076,933.58
Equity
Legal representative: Zhang Xian
Person in charge of accounting work: Chen Shengming
Person in charge of accounting department: Zhu Shana
2. Balance Sheet of the Parent Company
Unit: RMB
Item December 31, 2020 December 31, 2019
Current Assets:
Cash and Bank Balances 788,724,841.16 645,534,966.84
Trading Financial Assets 351,492,520.54
Derivative Financial Assets
Note’s receivable
Accounts receivable 38,224.90 1,269,835.09
Receivables Financing
95
2020 Annual Report of Songcheng Performance Development Co., Ltd
Prepayments 2,031,894.01 2,458,855.65
Other Receivables 1,046,160,763.74 1,100,294,815.74
Including: interest receivable
Dividends Receivable
Inventory 651,042.56 2,465,844.42
Contract Assets
Holding for-sale assets
Non-current Assets Due within 1
Year
Other Current Assets 1,240,658.07 1,671,867.65
Subtotal of Current Assets 1,838,847,424.44 2,105,188,705.93
Non-current Assets:
Investment in Creditor's Rights
Investment in Other Creditor's
Rights
Long-term Receivables
Long-term Equity Investment 6,433,238,270.32 6,941,849,814.49
Investment in Other Equity
214,975,166.42 294,665,442.88
Instruments
Other Non-current Financial
Assets
Investment Property
Fixed Assets 1,912,986.88 503,463,063.75
Projects under Construction 59,331,122.60
Productive Biological Assets
Oil and gas assets
Right-of-use Assets
Intangible Assets 3,418,590.95 145,128,033.35
Development Expenditure
Goodwill
Long-term unamortized expenses 2,600,000.20 10,183,821.75
Deferred Income Tax Assets 15,581,293.31 7,476,137.89
Other Non-current Assets 9,838,928.50
Subtotal of Non-current Assets 6,671,726,308.08 7,971,936,365.21
Total Assets 8,510,573,732.52 10,077,125,071.14
96
2020 Annual Report of Songcheng Performance Development Co., Ltd
Current Liabilities:
Short-term loan
Transactional financial liabilities
Derivative Financial Liabilities
Notes Payable
Accounts Payable 1,154,036.06 44,171,004.81
Received Prepayments 22,214,761.65
Contract liabilities
Payroll payable 7,873,282.52 12,673,534.31
Tax Payable 1,394,799.62 4,818,330.21
Other Payables 2,056,738,130.14 1,953,433,149.11
Including: interest payable
Dividends Payable
Holding for-sale liabilities
Non-current Liabilities Due within
12,426,708.33
1 Year
Other Current Liabilities
Subtotal of Current Liabilities 2,079,586,956.67 2,037,310,780.09
Non-current Liabilities:
Long-term loan 282,000,000.00
Bonds Payable
Including: Preferred Stocks
Perpetual Bonds
Lease Liabilities
Long-term Payables
Long-term payroll payable
Expected Liabilities
Deferred Income 5,620,598.89
Deferred Income Tax Liabilities 9,983,693.86
Other Non-current Liabilities
Subtotal of Non-current Liabilities 282,000,000.00 15,604,292.75
Total Liabilities 2,361,586,956.67 2,052,915,072.84
Shareholders' Equity:
Share Capital 2,614,694,040.00 1,452,607,800.00
97
2020 Annual Report of Songcheng Performance Development Co., Ltd
Other Equity Instruments
Including: Preferred Stocks
Perpetual Bonds
Capital Reserves 1,248,861,998.85 2,478,350,525.70
Less: Treasury Share
Other Comprehensive Incomes -38,171,990.42 31,870,051.79
Special Reserves
Surplus Reserves 517,673,268.35 517,673,268.35
Undistributed Profits 1,805,929,459.07 3,543,708,352.46
Total Shareholders' Equity 6,148,986,775.85 8,024,209,998.30
Total Liabilities and Shareholders'
8,510,573,732.52 10,077,125,071.14
Equity
3. Consolidated Income Statement
Unit: RMB
Item 2020 The Year Of 2019
I. Total Operating Revenue 902,586,125.63 2,611,753,208.86
Including: Operating Revenue 902,586,125.63 2,611,753,208.86
Interest Income
Earned Premiums
Service Charge and
Commission Income
II. Total Operating Cost 740,982,414.36 1,147,753,469.26
Including: Operating Cost 352,670,473.42 747,189,301.24
Interest Expenditures
Service Charge and
Commission Expenses
Surrender Value
Net Claims Paid
Net Amount of Withdrawn
Reserve for Insurance Liability Contract
Policyholder Dividend
Expense
Reinsurance Cost
Taxes and Surcharges 11,933,497.05 36,164,788.45
98
2020 Annual Report of Songcheng Performance Development Co., Ltd
Sales Expenses 63,649,750.30 145,503,636.64
Administration expenses 288,084,167.74 188,215,121.23
Research and development
37,487,964.00 48,424,520.54
expense
Financial Expenses -12,843,438.15 -17,743,898.84
Including: interest
7,822,986.14
expenses
Interest Income 32,572,127.48 22,648,412.21
Add: Other income 34,572,160.23 4,285,224.19
Investment Income (Mark "-"
14,014,892.30 273,166,244.68
for Loss)
Including: Investment Income
-5,356,968.22 72,523,327.47
from Affiliates and Joint Ventures
Profits from recognition
Termination of Financial Assets at
Amortized Cost
Exchange Gains (Mark "-" for
Losses)
Profit of Net Exposure Hedging
(Mark "-" for Loss)
Incomes from changes in fair
247,726.31 991,859.52
value (losses marked with "-")
Credit Impairment Losses
-32,739,976.91 1,325,984.52
(Mark "-" for Loss)
Asset Impairment Losses (Mark
-1,877,720,155.72 -17,425,960.27
"-" for Loss)
Asset Disposal Income (Mark
676,435.92 -767,848.08
"-" for Loss)
III. Operating Profit (Mark "-" for Loss) -1,699,345,206.60 1,725,575,244.16
Add: Non-operating Revenues 3,242,377.14 5,997,838.03
Less: Non-operating Expenses 41,007,879.43 101,517,003.90
IV. Total Profit (Mark "-" for Total Loss) -1,737,110,708.89 1,630,056,078.29
Less: Income Tax Expense 29,835,169.11 265,152,567.09
V. Net Profit (Mark "-" for Net Loss) -1,766,945,878.00 1,364,903,511.20
i. Classified by operation continuity
1. Net Profit as a Going Concern
-1,766,945,878.00 1,364,903,511.20
(Mark "-" for Net Loss)
99
2020 Annual Report of Songcheng Performance Development Co., Ltd
2. Net Profit of Discontinued
Operation (Mark "-" for Net Loss)
ii. Classified by the attribution of
ownership
1. Net Profit Attributable to
-1,752,398,009.60 1,339,790,994.94
Shareholders of Parent Company
2. Minority Shareholders' Profit and
-14,547,868.40 25,112,516.26
Loss
VI. Net Amount of Other Comprehensive
-54,643,377.96 -436,587,617.54
Incomes after Tax
Net Amount of Other Comprehensive
Incomes after Tax Attributable to the -54,643,964.16 -436,587,615.65
Parent Company's Owner
(1) Other comprehensive income
-65,726,184.59 -390,940,031.83
that cannot be reclassified as P/L
1. Re-measure the variation
of the defined benefit plan
2. Other comprehensive
income that cannot be transferred to P/L 1,356,586.59 -1,356,586.59
under the equity method
3. Changes in the fair value
of investment in other equity -67,082,771.18 -389,583,445.24
instruments
4. Changes in the fair value
of the credit risk of the enterprise
5. Others
(2) Other comprehensive income
11,082,220.43 -45,647,583.82
that will be reclassified as P/L
1. Other comprehensive
income that can be transferred to P/L
under the equity method
2. Changes in the fair value
of investment in other creditor's rights
3. Financial assets
reclassified into other comprehensive
income
4. Provisions for the credit
impairment of investment in other
creditor's rights
100
2020 Annual Report of Songcheng Performance Development Co., Ltd
5. Cash flow hedge reserves
6. Currency translation
11,082,220.43 7,332,056.43
difference
7. Others -52,979,640.25
Net Amount of Other Comprehensive
Incomes After Tax Attributable to 586.20 -1.89
Minority Shareholders
VII. Total Comprehensive Income -1,821,589,255.96 928,315,893.66
Total Comprehensive Income
Attributable to the Parent Company's -1,807,041,973.76 903,203,379.29
Owner
Total Comprehensive Income
-14,547,282.20 25,112,514.37
Attributable to Minority Shareholders
VIII. Earnings per Share:
(I) Basic Earnings per Share -0.6702 0.5124
(II) Diluted Earnings per Share -0.6702 0.5124
In case of business combination under the same control during this period, the net profit realized by the consolidated party before
consolidation is: RMB 0, and the net profit realized by consolidated party in the previous period: RMB 0.
Legal representative: Zhang Xian
Person in charge of accounting work: Chen Shengming
Person in charge of accounting department: Zhu Shana
4. Income Statement of the Parent Company
Unit: RMB
Item 2020 The Year Of 2019
I. Operating Revenue 22,892,751.38 792,535,463.92
Less: Operating Cost 19,532,790.64 389,275,037.47
Taxes and Surcharges 1,295,426.42 7,397,252.10
Sales Expenses 7,343,898.62 25,286,850.07
Administration expenses 37,997,214.49 60,424,870.69
Research and development
4,741,111.89 9,017,859.90
expense
Financial Expenses -13,459,704.23 -8,196,303.54
Including: interest
7,822,986.14
expenses
101
2020 Annual Report of Songcheng Performance Development Co., Ltd
Interest Income 21,565,816.00 10,263,021.42
Add: Other income 15,285,586.12 2,319,386.38
Investment Income (Mark "-"
424,960,373.38 1,244,836,304.78
for Loss)
Including: Investment Income
-2,931,524.95 110,867,013.28
from Affiliates and Joint Ventures
Profits from
Derecognition of Financial Assets at
Amortized Cost (Mark "-" for Loss)
Profit of Net Exposure
Hedging (Mark "-" for Loss)
Incomes from changes in fair
-1,492,520.54 1,492,520.54
value (losses marked with "-")
Credit Impairment Losses
-32,526,876.92 -498,499.60
(Mark "-" for Loss)
Asset Impairment Losses
-1,814,682,876.81
(Mark "-" for Loss)
Asset Disposal Income (Mark
17,156.67 4,943.75
"-" for Loss)
II. Operating Profit (Mark "-" for Loss) -1,442,997,144.55 1,557,484,553.08
Add: Non-operating Revenues 1,103,676.45 2,115,939.32
Less: Non-operating Expenses 2,213,333.49 58,195,427.29
III. Total Profit (Mark "-" for Total Loss) -1,444,106,801.59 1,501,405,065.11
Less: Income Tax Expense 3,112,861.27 72,308,087.18
IV. Net Profit (Mark "-" for Net Loss) -1,447,219,662.86 1,429,096,977.93
(I) Net Profit as a Going Concern
-1,447,219,662.86 1,429,096,977.93
(Mark "-" for Net Loss)
(II) Net Profit of Discontinued
Operation (Mark "-" for Net Loss)
V. Net Amount of Other Comprehensive
-70,042,042.21 -374,558,803.16
Incomes After Tax
(1) Other comprehensive income
-70,042,042.21 -374,558,803.16
that cannot be reclassified as P/L
1. Re-measure the
variation of the defined benefit plan
2. Other comprehensive
income that cannot be transferred to 37,670.53 -1,372,268.11
P/L under the equity method
102
2020 Annual Report of Songcheng Performance Development Co., Ltd
3. Changes in the fair value
of investment in other equity -70,079,712.74 -373,186,535.05
instruments
4. Changes in the fair value
of the credit risk of the enterprise
5. Others
(2) Other comprehensive income
that will be reclassified as P/L
1. Other comprehensive
income that can be transferred to P/L
under the equity method
2. Changes in the fair value
of investment in other creditor's rights
3. Financial assets
reclassified into other comprehensive
income
4. Provisions for the credit
impairment of investment in other
creditor's rights
5. Cash flow hedge
reserves
6. Currency translation
difference
7. Others
VI. Total Comprehensive Income -1,517,261,705.07 1,054,538,174.77
VII. Earnings per Share:
(I) Basic Earnings per Share
(II) Diluted Earnings per Share
5. Consolidated Cash Flow Statement
Unit: RMB
Item 2020 The Year Of 2019
I. Cash Flow Generated by Operational
Activities:
Cash from Sales of Merchandise
807,841,498.50 2,667,025,005.20
and Provision of Services
Net Increase in Customer's Bank
Deposits and Interbank Deposits
103
2020 Annual Report of Songcheng Performance Development Co., Ltd
Net Increase in Borrowings from
the Central Bank
Net Increase in Borrowings from
Other Financial Institutions
Cash Arising from Receiving
Premiums for the Original Insurance
Contract
Net Amount Arising from
Reinsurance Business
Net Increase in Deposits and
Investments from Policyholders
Cash Arising from Interests,
Service Charges and Commissions
Net Increase in Borrowings from
Banks and Other Financial Institutions
Net Increase in Repurchase
Business Funds
Net Amount of Cash Received
from the Vicariously Traded Securities
Tax Refund 32,176,543.78
Other Received Cashes Related to
103,772,075.60 479,656,404.12
Operational Activities
Subtotal of cash inflow from
943,790,117.88 3,146,681,409.32
operational activities
Cash Paid for Merchandise and
144,882,412.49 589,412,294.52
Services
Net Increase in Loans and
Advances to Customers
Net Increase in Deposits with
Central Bank and Other Financial
Institutions
Cash Paid for Original Insurance
Contract Claims
Net increase of funds lent
Cash Paid for Interests, Service
Charges and Commissions
Cash Paid for Policy Dividends
Cash Paid to and for Employees 183,145,317.90 240,420,521.04
104
2020 Annual Report of Songcheng Performance Development Co., Ltd
Cash Paid for Taxes and Surcharges 64,685,320.62 414,326,350.84
Other Paid Cashes Related to
157,135,166.93 331,070,743.41
Operational Activities
Subtotal of cash outflow from
549,848,217.94 1,575,229,909.81
operational activities
Net cash flow generated by operating
393,941,899.94 1,571,451,499.51
activities
II. Cash Flow from Investment
Activities:
Cash Arising from Disposal of
1,349,803,239.12 1,937,501,358.58
Investments
Cash Arising from Investment
Incomes
Net Cash Arising from Disposal of
Fixed Assets, Intangible Assets and 2,136,278.15 1,980,388.82
Other Long-term Assets
Net Cash Arising from Disposal of
Subsidiaries and Other Business Units
Other Received Cashes Related to
Investment Activities
Subtotal of cash inflow from
1,351,939,517.27 1,939,481,747.40
investment activities
Cash Paid for Purchase and
Construction of Fixed Assets, Intangible 1,017,897,394.85 813,257,636.27
Assets and Other Long-term Assets
Cash Paid for Investments 897,276,184.30 1,962,519,693.46
Net Increase in Pledge Loans
Net Cash Paid for Acquisition of
377,767,506.95
Subsidiaries and Other Business Units
Other Paid Cashes Related to
345,075,573.87
Investment Activities
Subtotal of Cash Outflow from
2,292,941,086.10 3,120,852,903.60
Investment Activities
Net amount of cash flow generated by
-941,001,568.83 -1,181,371,156.20
investment activities
III. Cash Flow from Financing Activities:
Cash Arising from Absorbing
120,000,000.00 13,500,000.00
Investments
105
2020 Annual Report of Songcheng Performance Development Co., Ltd
Including: Cash Arising from
Subsidiaries Absorbing Investments by 120,000,000.00 13,500,000.00
Minority Shareholders
Cash Arising from Borrowings 300,000,000.00
Other Received Cashes Related to
Financing Activities
Subtotal of cash inflow from financing
420,000,000.00 13,500,000.00
activities
Cash Paid for Debts Repayment 6,000,000.00
Cash Paid for Distribution of
Dividends and Profits or Payment of 300,917,837.81 174,312,936.00
Interests
Including: Dividends and Profits
Paid to Minority Shareholders by 3,000,000.00
Subsidiaries
Other Paid Cashes Related to
Financing Activities
Subtotal of cash outflow from financing
306,917,837.81 174,312,936.00
activities
Net cash flow generated by financing
113,082,162.19 -160,812,936.00
activities
IV. Impact of Fluctuation in Exchange
-9,956,266.67 2,494,267.57
Rate on Cash and Cash Equivalents
V. Net Increase in Cash and Cash
-443,933,773.37 231,761,674.88
Equivalents
Add: Cash and Cash Equivalents at
1,781,710,027.35 1,549,948,352.47
the Commencement of the Period
VI. Cash and Cash Equivalents at the
1,337,776,253.98 1,781,710,027.35
End of the Period
6. Cash Flow Statement of the Parent Company
Unit: RMB
Item 2020 The Year Of 2019
I. Cash Flow Generated by Operational
Activities:
Cash from Sales of Merchandise
21,146,321.04 818,461,484.19
and Provision of Services
Tax Refund
106
2020 Annual Report of Songcheng Performance Development Co., Ltd
Other Received Cashes Related to
796,910,713.36 741,502,483.61
Operational Activities
Subtotal of cash inflow from
818,057,034.40 1,559,963,967.80
operational activities
Cash Paid for Merchandise and
4,428,163.75 322,258,340.90
Services
Cash Paid to and for Employees 29,084,333.46 53,896,350.21
Cash Paid for Taxes and Surcharges 16,523,204.31 109,688,330.05
Other Paid Cashes Related to
655,676,151.74 1,041,403,424.51
Operational Activities
Subtotal of cash outflow from
705,711,853.26 1,527,246,445.67
operational activities
Net cash flow generated by operating
112,345,181.14 32,717,522.13
activities
II. Cash Flow from Investment
Activities:
Cash Arising from Disposal of
702,850,832.94 854,379,652.38
Investments
Cash Arising from Investment
432,000,000.00 618,000,000.00
Incomes
Net Cash Arising from Disposal of
Fixed Assets, Intangible Assets and 36,281.55 234,135.90
Other Long-term Assets
Net Cash Arising from Disposal of
Subsidiaries and Other Business Units
Other Received Cashes Related to
Investment Activities
Subtotal of cash inflow from
1,134,887,114.49 1,472,613,788.28
investment activities
Cash Paid for Purchase and
Construction of Fixed Assets, Intangible 29,624,583.50 103,874,516.62
Assets and Other Long-term Assets
Cash Paid for Investments 692,500,000.00 1,130,396,000.00
Net Cash Paid for Acquisition of
378,000,000.00 190,850,000.00
Subsidiaries and Other Business Units
Other Paid Cashes Related to
Investment Activities
Subtotal of Cash Outflow from 1,100,124,583.50 1,425,120,516.62
107
2020 Annual Report of Songcheng Performance Development Co., Ltd
Investment Activities
Net amount of cash flow generated by
34,762,530.99 47,493,271.66
investment activities
III. Cash Flow from Financing Activities:
Cash Arising from Absorbing
Investments
Cash Arising from Borrowings 300,000,000.00
Other Received Cashes Related to
Financing Activities
Subtotal of cash inflow from financing
300,000,000.00
activities
Cash Paid for Debts Repayment 6,000,000.00
Cash Paid for Distribution of
Dividends and Profits or Payment of 297,917,837.81 174,312,936.00
Interests
Other Paid Cashes Related to
Financing Activities
Subtotal of cash outflow from financing
303,917,837.81 174,312,936.00
activities
Net cash flow generated by financing
-3,917,837.81 -174,312,936.00
activities
IV. Impact of Fluctuation in Exchange
Rate on Cash and Cash Equivalents
V. Net Increase in Cash and Cash
143,189,874.32 -94,102,142.21
Equivalents
Add: Cash and Cash Equivalents at
645,534,966.84 739,637,109.05
the Commencement of the Period
VI. Cash and Cash Equivalents at the
788,724,841.16 645,534,966.84
End of the Period
7. Consolidated Statement of Changes in Owners' Equity
Amount of this period
Unit: RMB
2020
Shareholders' Equity Attributable to the Parent Company's Owner Minority Total
Item
Share Other Equity Capital Less Other Spec Surplus Gen Undistrib Oth Shareho Sharehold
Subtotal
Capital Instruments Reserves : Compre ial Reserve eral uted ers lders' ers'
108
2020 Annual Report of Songcheng Performance Development Co., Ltd
Prefe Perp Trea hensive Rese s Risk Profits Equity Equity
rred etual Oth sury Incomes rves Rese
Stoc Bond ers Shar rves
ks s e
I. Balance
at the End 1,452,60 2,476,312 -8,681,1 517,673 5,176,157 9,614,069 268,322 9,882,391
of Last 7,800.00 ,069.09 51.59 ,268.35 ,180.79 ,166.64 ,155.87 ,322.51
Year
Add:
Changes
in
Accountin
g Policies
Correction
of Errors
in the
Previous
Period
Consolidat
ed under
the Same
Control
Others
II. Balance
at the 1,452,60 2,476,312 -8,681,1 517,673 5,176,157 9,614,069 268,322 9,882,391
Start of 7,800.00 ,069.09 51.59 ,268.35 ,180.79 ,166.64 ,155.87 ,322.51
This Year
III.
Increases
or
Decreases
in This 1,162,08 -1,264,94 -54,643, -2,044,27 -2,201,78 54,650, -2,147,13
Period 6,240.00 7,854.23 964.16 6,156.19 1,734.58 575.85 1,158.73
(Mark "-"
for
Decreases
)
(I) Total -56,000, -1,752,39 -1,808,39 -14,547, -1,822,94
Comprehe 550.75 8,009.60 8,560.35 282.20 5,842.55
109
2020 Annual Report of Songcheng Performance Development Co., Ltd
nsive
Income
(II)
Sharehold
ers'
-35,459,3 -35,459,3 72,197, 36,738,53
Contributi
27.38 27.38 858.05 0.67
on and
Reduction
in Capital
1． Com
mon stock
72,959, 72,959,32
invested
327.38 7.38
by the
owner
2． Capit
al
Invested
by
Holders of
Other
Equity
Instrumen
ts
3． Num
ber of
Share-bas
ed
Payments
Recorded
into
Sharehold
ers' Equity
-35,459,3 -35,459,3 -761,46 -36,220,7
4．Others
27.38 27.38 9.33 96.71
(III) Profit
-290,521, -290,521, -3,000,0 -293,521,
Distributio
560.00 560.00 00.00 560.00
n
1． Appr
opriation
of Surplus
Reserves
2． Appr
110
2020 Annual Report of Songcheng Performance Development Co., Ltd
opriation
of General
Risk
Reserves
3． Distri
bution to
Owners -290,521, -290,521, -3,000,0 -293,521,
(or 560.00 560.00 00.00 560.00
Sharehold
ers)
4．Others
(IV)
Internal
Carry-for 1,162,08 -1,162,08 1,356,5 -1,356,58
ward of 6,240.00 6,240.00 86.59 6.59
Sharehold
ers' Equity
1． Capit
al
Reserves
Transferre 1,162,08 -1,162,08
d into 6,240.00 6,240.00
Capital (or
Share
Capital)
2． Surpl
us
Reserves
Transferre
d into
Capital (or
Share
Capital)
3． Surpl
us
Reserves
Covering
Losses
4． Carry
-forward
retained
earnings
111
2020 Annual Report of Songcheng Performance Development Co., Ltd
of the
variation
of the
defined
benefit
plan
5． Other
Carry-for
ward
Retained
1,356,5 -1,356,58
Earnings
86.59 6.59
of the
Comprehe
nsive
Income
6. Others
(V) Special
Reserves
1． With
drawal in
this
period
2． Used
in This
Period
(VI) -67,402,2 -67,402,2 -67,402,2
Others 86.85 86.85 86.85
IV.
Balance at
2,614,69 1,211,364 -63,325, 517,673 3,131,881 7,412,287 322,972 7,735,260
the End of
4,040.00 ,214.86 115.75 ,268.35 ,024.60 ,432.06 ,731.72 ,163.78
This
Period
Amount of Previous Period
Unit: RMB
2019
Shareholders' Equity Attributable to the Parent Company's Owner
Other Equity Less Gen Minority
Other Spec Total
Item Instruments Surplus eral Undistrib Sharehol
:
Share Capital Compre ial Oth Sharehold
Trea Reserve Risk uted Subtotal ders'
Prefe Perp hensive Rese ers' Equity
Capital Oth Reserves ers
sury s Rese Profits Equity
rred etual
ers Incomes rves
Stoc Bond Shar rves
112
2020 Annual Report of Songcheng Performance Development Co., Ltd
ks s e
I. Balance
at the End 1,452,60 2,476,31 20,405,9 351,171 4,170,57 8,471,07 1,217,35 9,688,428
of Last 7,800.00 2,069.09 65.33 ,582.73 7,596.34 5,013.49 3,199.38 ,212.87
Year
Add:
Changes
407,500, -386,86 3,653,57 410,767, 1,390,39 412,157,6
in
498.73 2.17 9.35 215.91 6.57 12.48
Accountin
g Policies
Correction
of Errors
in the
Previous
Period
Consolidat
ed under
the Same
Control
Others
II. Balance
at the 1,452,60 2,476,31 427,906, 350,784 4,174,23 8,881,84 1,218,74 10,100,58
Start of 7,800.00 2,069.09 464.06 ,720.56 1,175.69 2,229.40 3,595.95 5,825.35
This Year
III.
Increases
or
Decreases
in This -436,587 166,888 1,001,92 732,226, -950,421, -218,194,
Period ,615.65 ,547.79 6,005.10 937.24 440.08 502.84
(Mark "-"
for
Decreases
)
(I) Total
Comprehe -433,251 1,339,79 906,539, 25,112,5 931,652,3
nsive ,121.70 0,994.94 873.24 14.37 87.61
Income
113
2020 Annual Report of Songcheng Performance Development Co., Ltd
(II)
Sharehold
ers'
-975,533, -975,533,
Contributi
954.45 954.45
on and
Reduction
in Capital
1． Com
mon stock
13,500,0 13,500,00
invested
00.00 0.00
by the
owner
2． Capit
al
Invested
by
Holders of
Other
Equity
Instrumen
ts
3． Num
ber of
Share-bas
ed
Payments
Recorded
into
Sharehold
ers' Equity
-989,033, -989,033,
4．Others
954.45 954.45
(III) Profit
166,888 -341,201, -174,312, -174,312,
Distributio
,547.79 483.79 936.00 936.00
n
1． Appr
opriation 166,888 -166,888,
of Surplus ,547.79 547.79
Reserves
2． Appr
opriation
of General
114
2020 Annual Report of Songcheng Performance Development Co., Ltd
Risk
Reserves
3． Distri
bution to
Owners -174,312, -174,312, -174,312,
(or 936.00 936.00 936.00
Sharehold
ers)
4．Others
(IV)
Internal
Carry-for -3,336,4 3,336,49
ward of 93.95 3.95
Sharehold
ers' Equity
1． Capit
al
Reserves
Transferre
d into
Capital (or
Share
Capital)
2． Surpl
us
Reserves
Transferre
d into
Capital (or
Share
Capital)
3． Surpl
us
Reserves
Covering
Losses
4． Carry
-forward
retained
earnings
of the
variation
115
2020 Annual Report of Songcheng Performance Development Co., Ltd
of the
defined
benefit
plan
5． Other
Carry-for
ward
Retained
-3,336,4 3,336,49
Earnings
93.95 3.95
of the
Comprehe
nsive
Income
6. Others
(V) Special
Reserves
1． With
drawal in
this
period
2． Used
in This
Period
(VI)
Others
IV.
Balance at
1,452,60 2,476,31 -8,681,1 517,673 5,176,15 9,614,06 268,322, 9,882,391
the End of
7,800.00 2,069.09 51.59 ,268.35 7,180.79 9,166.64 155.87 ,322.51
This
Period
8. Statement of Changes in Owners' Equity of the Parent Company
Amount of this period
Unit: RMB
2020
Other Equity
Less: Other Speci
Instruments Total
Item Share Capital Treas Comprehe al Surplus Undistribute Oth
Prefer Perpet Shareholder
Capital Oth Reserves ury nsive Reser Reserves d Profits ers
red ual s' Equity
ers Share Incomes ves
Stocks Bonds
116
2020 Annual Report of Songcheng Performance Development Co., Ltd
I. Balance at
1,452,607,8 2,478,350,5 31,870,05 517,673,2 3,543,708,3 8,024,209,9
the End of
00.00 25.70 1.79 68.35 52.46 98.30
Last Year
Add:
Changes in
Accounting
Policies
Correction of
Errors in the
Previous
Period
Others
II. Balance at
1,452,607,8 2,478,350,5 31,870,05 517,673,2 3,543,708,3 8,024,209,9
the Start of
00.00 25.70 1.79 68.35 52.46 98.30
This Year
III. Increases
or Decreases
in This 1,162,086,2 -1,229,488,5 -70,042,04 -1,737,778,8 -1,875,223,2
Period (Mark 40.00 26.85 2.21 93.39 22.45
"-" for
Decreases)
(I) Total
-70,079,71 -1,447,219,6 -1,517,299,3
Comprehensi
2.74 62.86 75.60
ve Income
(II)
Shareholders
'
Contribution
and
Reduction in
Capital
1． Common
stock
invested by
the owner
2． Capital
Invested by
Holders of
Other Equity
117
2020 Annual Report of Songcheng Performance Development Co., Ltd
Instruments
3． Number
of
Share-based
Payments
Recorded
into
Shareholders
' Equity
4． Others
(III) Profit -290,521,56 -290,521,56
Distribution 0.00 0.00
1． Appropr
iation of
Surplus
Reserves
2． Distribu
tion to
-290,521,56 -290,521,56
Owners (or
0.00 0.00
Shareholders
)
3． Others
(IV) Internal
Carry-forwar
1,162,086,2 -1,162,086,2
d of 37,670.53 -37,670.53
40.00 40.00
Shareholders
' Equity
1． Capital
Reserves
Transferred 1,162,086,2 -1,162,086,2
into Capital 40.00 40.00
(or Share
Capital)
2． Surplus
Reserves
Transferred
into Capital
(or Share
Capital)
3． Surplus
Reserves
118
2020 Annual Report of Songcheng Performance Development Co., Ltd
Covering
Losses
4． Carry-fo
rward
retained
earnings of
the variation
of the
defined
benefit plan
5． Other
Carry-forwar
d Retained
Earnings of 37,670.53 -37,670.53
the
Comprehensi
ve Income
6. Others
(V) Special
Reserves
1． Withdra
wal in this
period
2． Used in
This Period
-67,402,286. -67,402,286.
(VI) Others
85 85
IV. Balance at
2,614,694,0 1,248,861,9 -38,171,99 517,673,2 1,805,929,4 6,148,986,7
the End of
40.00 98.85 0.42 68.35 59.07 75.85
This Period
Amount of Previous Period
Unit: RMB
2019
Other Equity
Other
Instruments Capital Less: Surplus Undistrib Total
Item Share Compre Special
Preferr Perpet Reserve Treasury Reserve uted Others Shareholde
Capital hensive Reserves
ed ual Others s Share s Profits rs' Equity
Incomes
Stocks Bonds
I. Balance at the 1,452, 2,478,3 351,171 2,219,490 6,501,620,3
End of Last Year 607,80 50,525. ,582.73 ,436.39 44.82
119
2020 Annual Report of Songcheng Performance Development Co., Ltd
0.00 70
Add:
Changes in 405,094 -386,86 -3,481,75 401,225,63
Accounting ,257.37 2.17 9.53 5.67
Policies
Correction of
Errors in the
Previous Period
1,334,5 23,978, 215,809,6 241,123,09
Others 97.58 850.00 49.94 7.52
II. Balance at 1,452, 2,478,3
406,428 374,763 2,431,818 7,143,969,0
the Start of This 607,80 50,525.
,854.95 ,570.56 ,326.80 78.01
Year 0.00 70
III. Increases or
Decreases in -374,55
142,909 1,111,890 880,240,92
This Period 8,803.1
,697.79 ,025.66 0.29
(Mark "-" for 6
Decreases)
(I) Total -374,54
1,429,096 1,054,553,8
Comprehensive 3,121.6
,977.93 56.29
Income 4
(II)
Shareholders'
Contribution
and Reduction
in Capital
1． Common
stock invested
by the owner
2． Capital
Invested by
Holders of
Other Equity
Instruments
3． Number of
Share-based
Payments
Recorded into
Shareholders'
Equity
120
2020 Annual Report of Songcheng Performance Development Co., Ltd
4． Others
(III) Profit 142,909 -317,222, -174,312,9
Distribution ,697.79 633.79 36.00
1． Appropriat
142,909 -142,909,
ion of Surplus
,697.79 697.79
Reserves
2． Distribution
-174,312, -174,312,9
to Owners (or
936.00 36.00
Shareholders)
3． Others
(IV) Internal
Carry-forward
-15,681.
of 15,681.52
52
Shareholders'
Equity
1． Capital
Reserves
Transferred into
Capital (or
Share Capital)
2． Surplus
Reserves
Transferred into
Capital (or
Share Capital)
3． Surplus
Reserves
Covering Losses
4． Carry-forw
ard retained
earnings of the
variation of the
defined benefit
plan
5． Other
Carry-forward
Retained -15,681.
15,681.52
Earnings of the 52
Comprehensive
Income
6. Others
121
2020 Annual Report of Songcheng Performance Development Co., Ltd
(V) Special
Reserves
1． Withdrawal
in this period
2． Used in This
Period
(VI) Others
IV. Balance at 1,452, 2,478,3
31,870, 517,673 3,543,708 8,024,209,9
the End of This 607,80 50,525.
051.79 ,268.35 ,352.46 98.30
Period 0.00 70
III. Basic Information about the Company
Songcheng Performance Development Co., Ltd. (it was previously named as Hangzhou Songcheng Tourism Development Co.,
Ltd., hereinafter referred to as the "Company"), formerly known as Hangzhou Songcheng Group Co., Ltd. (before the change, it was
Hangzhou WorldlandSongcheng Real Estate Co., Ltd). On December 27, 2000, with the approval document of Zhejiang [2000] No.
69 "Official Reply on the Approval for Alteration and Establishment of Hangzhou Song Cheng Tourism De velopment Co., Ltd.", which
was issued by Leading Group for Enterprise Listing of Zhejiang Provincial People's Government, Hangzhou Songcheng Group Co., Ltd.
approved and contributed net assets of RMB 60 million (audited on November 30, 2000) which was con verted into a total of 60
million shares at the ratio of 1:1, to alter and establish Hangzhou Songcheng Tourism Development Co., Ltd. (The company chan ged
its name as Songcheng Performance Development Co., Ltd on April 18, 2014). The company registered cap ital was RMB 60 million.
This overall change was verified by Shu Lun Pan Changjiang CPAs Co. Ltd. (now renamed as BDO China Shu Lun Pan CPAs (special
general partnership)) and No. 20370 [2000] Xinchang kuaishibaozi "Capital Verification Report"was issued a ccordingly. On
December 28, 2000, the company obtained the "Corporate Legal Person Business License" with the registration number
3301002004635 issued by the Hangzhou Administration for Industry and Commerce. The registered capital was RMB 60 million and
the legal representative was Huang Qiaoling. In 2001, the company changed its industry and commerce registration authority to
Zhejiang Administration for Industry and Commerce, and obtained the updated business license with registration number of
3300001008413. In 2008, Zhejiang Administration for Industry and Commerce changed the numbers uniformly, for which the
company business license registration number was changed to 330000000019888. In 2015, under the official policy "Five
certificates into one", the company business license registration number was changed to "Unified Social Credit Code
91330000143102311G (1/1).
On October 10, 2004, shareholder Zeng Yingjiu transferred 2 million shares to Huang Qiaoling and the company went through
the procedures for industrial and commercial registration change on October 20, 2004. On December 31, 2004, shareholder Cai
Jianxi transferred 1.65 million shares to Huang Qiaoling, and the company went through the procedures for industrial and
commercial registration change on April 11, 2005. On February 22, 2008, shareholder Cai Jianxi transferred 1.65 million shares to
Zhang Huibing, and the company went through the procedures for industrial and commercial registration change on March 26, 200 8.
On June 18, 2009, new shareholder East Sky Venture Capital Co., Ltd (formerly named as East Sky Culture Communication
122
2020 Annual Report of Songcheng Performance Development Co., Ltd
Investment Co., Ltd.), at 10 times of diluted price-earnings ratio based on the net profit attributed to the parent company after
deducting non-recurring gains & losses as of December 31, 2008, invested total of RMB 30,977,421.35, of which RMB 3 million of
registered capital paid and RMB 27,977,421.35 of share premium paid. The registered capital of the company after change was R MB
63 million. On June 23, 2009, the company completed industrial and commercial registration change.
On December 21, 2009, the company, in accordance with amended Articles of Association and the resolution of the Fifth
Extraordinary General Meeting of Shareholders of Year 2009, applied 63 million shares at the end of the third quarter of Year 2009
and distributed the Undistributed Profits to all shareholders at the rate of 10 bonus shares (excluding tax) for every 10 sha res. Total
of 63 million additional shares of capital were added. After the conversion, the company Registered Capital was RMB 126 million
The company completed the industrial and commercial registration change on December 24, 2009.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2009, and the approval document No.
1632 [2010]"Official Reply on Approval of Hangzhou Songcheng Tourism Development Co., Ltd. Initial Public Offering and Listin g on
the Growth Enterprise Market” issued by China Securities Regulatory Commission (CSRC), 42 million new shares were issued to
public. The issue price per share was RMB 53, and the total amount of funds raised was RMB 2,226 million. After deducting the
payment of RMB 97,579,000 for issuance costs, the net amount of funds raised was RMB 2,128,421,000, of which t he Share Capital
was RMB 42 million and the Capital Premium was RMB 2,086,421,000. After the change, the registered capital of the company was
RMB 168 million. The company completed the procedure for industrial and commercial registration change on Decembe r 15, 2010.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2010 and the revised Articles of
Association, the company, based on its total capital of 168 million shares at the end of 2010, transferred 12 additional shar es per 10
shares from the Capital Reserves to all shareholders. Total of 201.6 million additional shares were added. The company registered
capital was RMB 369.6 million after change. The company completed the industrial and commercial registration change on Thursday,
June 2, 2011.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2011 and the revised Articles of
Association, the company, based on its total capital of 369.6 million shares at the end of 2011, transferred 5 additional shares for
every 10 shares from the capital reserves to all shareholders. Total of 184.8 million additional shares were added. The compa ny
registered capital was RMB 554.4 million after change. The company completed the industrial and commercial registration change
on Tuesday, May 29, 2012.
According to "Restricted Stock Incentive Plan of Hangzhou Songcheng Tourism Development Co., Ltd. Revision (Draft)" which
was reviewed and approved in the Resolution of First Extraordinary General Meeting of Shareholders of Year 2013 held on April 10,
2013, "Proposal on Adjusting the Company Restricted Stock Incentive Plan" and "Proposal on Granting Restricted Stock to Incen tive
Objects" which was reviewed and approved in the 32nd Meeting of Company Fourth Board of Directors held on May 2, 2013, the
company granted 3,816,000 restricted shares to 144 senior management personnel and technical (business) backbone for the firs t
time. The first date of restricted shares granted was on May 2, 2013, with a grant price of RMB 6.28, adjusted to RMB 6.13 per share
after deducting RMB 0.15 (distribution of dividends). The company received RMB 23,392,080 contributions by 144 people. The
registered capital increased by RMB 3,816,000 and capital reserves increased by RMB 195, 760,800. The registered capital of the
company was RMB 558,216,000 after change. The company completed the industrial and commercial registration change on
123
2020 Annual Report of Songcheng Performance Development Co., Ltd
Monday, June 3, 2013.
According to the Resolution of the Third Meeting of Fifth Company Board of Directors held on November 14, 2013, and
Resolution of the First Extraordinary General Meeting of Shareholders of Year 2013 held on December 2, 2013, the company appl ied
for repurchase and cancellation of the first-granted shares to 7 employees who had resigned. The registered capital decreased by
RMB 401,000, and the capital reserves decreased by RMB 2,057,130. The registered capital was RMB 557,815 thousand after
change. The company completed the industrial and commercial registration change on Monday, December 30, 2013.
According to the Resolution of the Eight Meeting of Fifth Company Board of Directors held on April 10, 2014 and the Second
Extraordinary General Meeting of Shareholders of Year 2014 held on April 25, 2014, the company applied share repurchase and
cancellation for the first shares granted of 3 employees who had resigned The registered capital decreased by RMB 40 thousand ,
and the capital reserves decreased by RMB 205.2 thousand. The registered capital was RMB 557,775 thousand after change. The
company completed the industrial and commercial registration change on Thursday, June 26, 2014.
According to the Resolution of the 17th Meeting of Fifth Company Board of Directors held on February 26, 2015 and the
Resolution of General Meeting of Shareholders of Year 2014 held on April 3, 2015, the company applied share repurchase and
cancellation for the first shares granted of 6 employees who had resigned. The registered capital decreased by RMB 84,800, an d the
capital reserves decreased by RMB 426,544. The registered capital was RMB 557,690.2 thousand after change. The company
completed the industrial and commercial registration change on Friday, May 22, 2015.
According to the Resolution of the 18th Meeting of Fifth Company Board of Directors held on March 17, 2015, and the
Resolution of the First Extraordinary General Meeting of Shareholders of Year 2015 held on April 2, 2015, and the approval
document” Official Reply on Approval of Songcheng Performance Development Co., Ltd to Issue Shares to Liu Yan and Others to
Purchase Assets and Raise Funds"(NO.1725 Securities License (2015)) which approved by CSRC on July 20, 2015, the company
issued non-public offering of 36,701,332 ordinary shares to 8 natural persons including Liu Yan, in order to purchase 38% eq uity of
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) held by the above -mentioned
natural persons. The par value per share was RMB 1.00, and the issue price was RMB 26.92 per share. The total amount of fund s
raised was RMB 988 million. The registered capital increased by RMB 36,701.332 thousand, and the capital reserves was increas ed
by RMB 951,298,668.00. The registered capital was RMB 594,391,532 after change. The company completed the industrial and
commercial registration change on Monday, August 10, 2015.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2015 and the revised Articles of
Association, the company, based on its total capital of 594,391,532 shares, transfe rred 14.073809 additional shares for every 10
shares from the capital reserves to all shareholders. Total of 836,535,289 additional shares were added. The registered capit al was
RMB 1,430,926,821 after change. The company completed the industrial and comme rcial registration change on Thursday,
September 17, 2015.
According to the Resolution of the 18th Meeting of Fifth Company Board of Directors held on March 17, 2015, and the
Resolution of the First Extraordinary General Meeting of Shareholders of Year 201 5 held on April 2, 2015, and the 28th Meeting of
Fifth Board of Directors held on Sept. 24, 2015. with the approval document "Official Reply on Approval of Songcheng Performa nce
124
2020 Annual Report of Songcheng Performance Development Co., Ltd
Development Co., Ltd to Issue Shares to Liu Yan and Others to Purchase Assets and Raise Funds"(NO.1725 Securities License (2015))
issued by CSRC on July 20, 2015 , the company issued shares to no more than 5 specific investors in private to raise funds, a nd the
total amount of funds raised should not exceed RMB 650 million. The company actually issued 21,753,681 ordinary shares (A shares)
to three institutional investors at RMB 29.88 per share. After deducting the underwriting expenses and various issuance expen ses of
the underwriters, the actual net funds raised was RMB 632,949,988.28, of which registered capital increased by RMB 21,753,681.00,
and the capital premium was RMB 611,196,307.28. The registered capital was RMB 1,452,680,502 after change. The company
completed the industrial and commercial registration change on Thursday, December 31, 2015.
According to the Resolution of the 31st Meeting of Fifth Board of Directors held on February 26, 2016 and the resolution of
Annual General Meeting of Shareholders of Year 2015 held on March 22, 2016, the company applied for share repurch ase and
cancellation for the first-granted shares to 4 employees who had resigned. The registered capital decreased by RMB 66,925, and the
capital reserves decreased by RMB 96,539. The registered capital was RMB 1,452,613,577 after change. The company comp leted
the industrial and commercial registration change on Thursday, May 5, 2016.
According to the Resolution of the Eighth meeting of Company Sixth Board of Directors held on February 27, 2017 and the
Annual General Meeting of Shareholders of Year 2016 held on March 24, 2017, the company applied for repurchase and
cancellation of the first-granted shares to one employee who had resigned. The registered capital decreased by RMB 5,777, and the
capital reserves decreased by RMB 7,914.49. The registered capital was RMB 1,452,607.8 thousand after change. The company
completed the industrial and commercial registration change on Tuesday, June 6, 2017.
According to the Resolution of the Eighth Meeting of Sixth Board of Directors held on April 27, 2020 and the Annu al General
Meeting of Shareholders of Year 2019 held on May 18 2020, the company, based on its total capital of 1,430,926,821 shares,
transferred 8 additional shares for every 10 shares from the Capital Reserves to all shareholders. Total of 1,162,086,240 additional
shares were added. The registered capital was RMB 2,614,694,040 after change. The company completed the industrial and
commercial registration change on Friday, August 14, 2020.
As of December 31, 2020, the company had issued a total of 2,614,694,000 shares, and the registered capital was RMB
2,614,694,040. The unified social credit code for Business License of Corporate Legal Person: 91330000143102311G, Registered
address: No. 148 Zhijiang Road, Hangzhou, Headquarter Address: No. 148 Zhijiang Road, Hangzhou. The business scope includes:
singing and dancing performance, acrobatics performance, opera performance, music performance, comprehensive artistic
performance (operated within the scope of "Business Performance License"), performance and brok erage business (operated within
the scope of "Business Performance License"), catering service (See "Catering Service License" for details), and parking serv ice.
Tourism services, theme park development and management, planning and organization of cultural activities, cultural
communication planning, animation design, exhibition organization, investment in and development of leisure industry, industrial
investment, tourism e-business, design, production, agency, and release of various domestic advertisements, film and television
projects Investment and management, tourism products and arts &crafts (excluding gold jewelry), general merchandise, native
products (excluding food) sales, publication wholesale and retail (operating with a license); the business scope of subsidiaries
included. (For items subject to approval according to law, business activities can only be carried out after approval by rele vant
125
2020 Annual Report of Songcheng Performance Development Co., Ltd
departments)
The company currently hasSongcheng tourist areas in 7 different regions, including Hangzhou Songcheng Tourist Area
(operated by Hangzhou Songcheng), Hangzhou Paradise, three Crazy Apple Land Tourist Area; Sanya Romance Park (operated by
Sanya Songcheng); Lijiang Romance Park (operated by Lijiang Songcheng); Jiuzhai Romance Park and the Tibetan Mystery
Theater(operated by Jiuzhai Songcheng); Guilin Romance Park (operated by Guilin Songcheng); Zhangjiajie Romance Park (operate d
by Zhangjiajie Songcheng); Xian Romance Park (operated by Xian Songcheng). The current business of the company also extends to
the planning and design of scenic parks, scenic cable car transportation, and Internet video industry. The registered address of the
company and headquarters office address: No. 148, Zhijiang Road, Hangzhou City.
The basic organizational structure of the company: the highest authority of the company is the General Meeting of
Shareholders, with implementation of the president responsibility system under the leadership of the Board of Directors. Some
functional departments are set up to meet the needs of business development, such as the Administration Department, Audit
Department, Human Resources Department, Securities Investment Department, Financial Management Department, Design
Department, Brand Planning Department, Engineering Management Department, Cost Management Department, Purchasing
Department, Project Development Department, Innovation Department, Outdoors Advertising Department, Art Troupe,
Commercial Development Management Center, Office of Chairman, and Marketing Department.
The parent company of the company is Hangzhou Songcheng Group Holdings Co., Ltd, and the actual controller of the company
is Huang Qiaoling.
This financial statement has been approved by Board of Directors on April 22, 2021.
As of the subsidiaries listed in the consolidated financial statements of the company are as follows:
Name of Subsidiaries
Hangzhou Paradise Co., Ltd.
Sanya Romance Tourism Performance Co., Ltd.
Lijiang Chama Ancient City Tourism Development Co., Ltd
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd
Hangzhou Songcheng Tourism Development Co., Ltd
Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd
Jiuzhaigou Tibetan Mystery Culture Co., Ltd
Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd
Hangzhou Songcheng Technology Development Co., Ltd.
Songcheng Performance International Development Co., Ltd.
Songcheng (Australia) Holdings Pty Ltd
126
2020 Annual Report of Songcheng Performance Development Co., Ltd
Name of Subsidiaries
Songcheng (Australia) Entertainment Pty Ltd.
Shanghai Songcheng World Expo Performance Development Co., Ltd
Songcheng Performance Development (Shanghai) Co., Ltd.
Guilin Lijiang Romance Performance Development Co., Ltd
Ningxiang Songcheng Tourism Development Co., Ltd.
Zhangjiajie Romance Performance Development Co., Ltd
Songcheng Technology Development Co.,Ltd.
Songcheng Tourism Development Co., Ltd.
Songcheng Performance Management Co., Ltd.
Songcheng Dumuqiao Network Co., Ltd.
Xi'an Romance Performance Development Co., Ltd
Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd
Foshan South Sea Qiao Mountain Cultural Tourism Development Co., Ltd
Hangzhou Songguo Cultural Creative Co., Ltd.
Hangzhou Songcheng performance Valley technology and Culture Development Co., Ltd
Songcheng Holdings (Thailand) Co., Ltd.
Songcheng (Pattaya) International Culture Co., Ltd.
Zhuhai Songcheng Performance Kingdom Co., Ltd
Zhuhai Southern Film and Television Cultural Industry Co., Ltd.
Zhuhai Huayin Landscaping Co., Ltd.
Songcheng Brand Management Co., Ltd.
Romance Show Management Co., Ltd.
For details of the scope and changes of the consolidated financial statements of the current period, please refer to Notes VI II
"Changes in the Scope of Consolidation" and Notes IX "Equity in Other Entities.
IV. Basis for Preparing the Financial Statement
1. Basis for the preparation
The financial statements are prepared in accordance with the "Accounting Standards for Business Enterprises-Basic Standards"
127
2020 Annual Report of Songcheng Performance Development Co., Ltd
and related specific accounting standards issued by the Ministry of Finance, Guidelines for Application of Accounting Standards for
Business Enterprises", “Interpretation of Accounting Standards for Business Enterprises and other relevant provisions" (herei nafter
collectively referred to as the "Accounting Standards for Business Enterprises"), and "No. 15 of the Rules on Information Disclosure
and Reporting of the Companies Issuing Securities Publicly" issued by CSRC.
2. Going concern
There is no matter or circumstance that would cause material doubt about the company ability of going concern in future 12
months since the end of the reporting period.
V. Significant Accounting Polices and Accounting Estimates
1. Statement on compliance with Accounting Standards for Business Enterprises
This financial statement is in compliance with the requirements in the Accounting Standards for Business Enterprises
promulgated by the Ministry of Finance and presents truly and completely the financial position of the merged companies and t he
parent company as at December 31, 2020 and the operating results and cash flows of the merger and the parent company in 2020.
2. Accounting period
An accounting year commences on January 1 and ends on December 31 of the Gregorian calendar.
3. Operating cycle
The Company's operating cycle is 12 months.
4. Functional currency
The company uses RMB as the standard currency for bookkeeping.
5. The accounting treatment of business combinations involving enterprises under common control and
business combinations not involving enterprises under common control
The assets and liabilities acquired by the combining party from the business combination (including the goodwill generated by
the ultimate controlling party's acquisition of the combined party) shall be measured on the basis of the book value of the assets
and liabilities of the combined party in the consolidated financial statements of ultimate controlling party on the combinati on date.
The difference between the book value of the net assets obtained and the book value of the consideration paid for the combination
(or total nominal value of the issued shares) is adjusted to capital premium in capital reserve. Adjustments shall be made to
retained earnings in the event that the share premiums in the capital reserves are not sufficient for write-down.
Business combination under different control: The cost of combination is the fair value of the assets, liabilities incurred o r
assumed, and equity securities issued by the acquiring party to obtain the control right of the acquired party on the acquisition date.
Where the cost of combination is higher than the fair value of the identifiable net assets acquired from the merging party in
business combination, such difference shall be recognized as goodwill; where the cost of combinatio n is less than the fair value of
the identifiable net assets acquired from the merging party in business combination, such difference shall be charged to the profit
or loss for the period. The identifiable assets, liabilities and contingent liabilities obtained by the acquiring party that meet the
128
2020 Annual Report of Songcheng Performance Development Co., Ltd
recognition conditions should be measured at fair value of the acquisition date.
The fees which are directly related to the business combination shall be recognized as the profit or loss in the period when the
costs are incurred; the transaction expenses of issuing equity securities or debt securities for business merger shall be initia lly
capitalized for equity securities or debt securities.
6. Preparation method of consolidated financial statements
(1) Scope of Consolidation
The consolidation scope of consolidated financial statements is determined on the basis of control, which includes the
company and all of its subsidiaries. Control means that the Company has the rights over the investee, enjoys variable return s
through participating in relevant activities of the investee, and has the ability to influence the amount of returns by exercising its
rights over the investee.
(2) Procedures of Consolidation
The company regards the whole group as an accounting entity and prepares consolidated financial statements in accordance
with unified accounting policies, in order to reflect the overall financial position, operating results and cash flow of the group. The
influence of internal transactions between the Company and the Subsidiaries and between the Subsidiaries shall be offset. Where
internal transaction indicates the occurrence of impairment loss to relevant assets, such loss shall be recognized in full. I n preparing
the consolidated financial statements, where the accounting policies and the accounting periods are inconsistent between the
Company and subsidiaries, the financial statements of subsidiaries are adjusted in accordance with the accounting policies an d
accounting period of the Company.
The owner's equity, the net profit or loss and the comprehensive income attributable to minority shareholders of a subsidiary
of the current period are presented separately under the owners' equity in the consolidated balance sheet, the net profit and the
total comprehensive income in the consolidated income statement respectively. Where losses attributable to the minority
shareholders of a subsidiary of the current period exceed the minority shareholders' interest entitled in the shareholders' e quity of
the subsidiary at the beginning of the period, the excess is allocated against the minority shareholders’ interest.
(1) Acquisition of subsidiaries or business
For acquisition of subsidiaries or business due to business combination involving entities under common control during the
reporting period, the operating results and cash flows of such subsidiaries or business from the beginning to the end of the
reporting period when the acquisition occurs shall be included in the consolidated financial statements. Adjustments shall be made
to the opening balance of the consolidated financial statements and the related items in the comparative statements
simultaneously as if the consolidated reporting entity has been in existence since the beginning of the control by the ultima te
controlling party.
For acquisition of subsidiaries or business due to business combination involving entities not under common control during th e
reporting period, the identifiable assets, liabilities and contingent liabilities shall be included in the consolidate d financial
statements based on the fair value determined on the date of the acquisition.
(2) Disposal of the subsidiaries
①General method
When losing control of the investee due to partial disposal of the equity investment, or any other reasons, the remaining
equity investment is remeasured at fair value at the date in which control is lost. The sum of consideration received from di sposal of
equity investment and the fair value of the remaining equity investment, net of the difference between the sum of the Company 's
previous share of the subsidiary's net assets recorded from the acquisition date or combination date and the sum of goodwill, is
recognized in investment income in the period in which control is lost. Other comprehensive income related to the equity
investment of the original subsidiary that can be reclassified into future profit or loss, and other changes of owners’ equit y
129
2020 Annual Report of Songcheng Performance Development Co., Ltd
accounted for under equity method shall be recognized in investment income in the period in which control is lost.
②Disposal of the subsidiaries step by step
When disposal of equity interests of subsidiaries through multiple transaction until the control is lo st, generally transactions in
stages are treatment as a package deal in accounting if the transaction terms, conditions, and economic impact of disposal of the
subsidiary's equity interests comply with one or more of the following:
i. These transactions are achieved at the same time or the mutual effects on each other are considered;
ii. A complete set of commercial results can be achieved with reference to the series of transactions as a whole;
iii. Achieving a transaction depends on at least achieving of one of the other transaction;
iv. One transaction recognized separately is not economical, but it is economical when considered together with other
transactions.
When losing control of a subsidiary in disposal of equity interests through multiple transacti ons is recognized as a package
deals, these transactions shall be in accounting treated as loss control of a subsidiary in disposal of equity interests achi eved.
However, the differences between price on each disposal and disposal of investment on the subsidiary's net assets shall be
recognized in other comprehensive income in the consolidated financial statements, and included in profit or loss for the period
when the control is lost.
If all transactions in disposal of equity interests of subsidiaries until losing control are not a package deals, accounting
treatment for partial disposal of equity investments of subsidiary without losing control shall be applied before control is lost. When
the control is lost, general accounting treatment for disposal of a subsidiary shall be used.
(3) Acquisition of minority interest of subsidiaries
The Company shall adjust the share premium in the capital reserve of the consolidated balance sheet with respect to any
difference between the long-term equity investment arising from the purchase of minority interest and the net assets attributing to
the parent company continuously calculated on the basis of the newly increased share proportion as of the acquisition date (o r date
of combination) or, adjust the retained earnings if the share premium in the capital reserve is insufficient for write -down.
(4) Partial disposal of equity investment in subsidiaries without losing control
The difference between disposal consideration of long-term equity investment in subsidiaries partially disposed without losing
control and the share of net assets calculated from the date of acquisition or combination date shall be adjusted to share pr emium
in the capital reserve in the consolidated balance sheet. Adjustments shall be made to retained earnings in the event that the share
premiums in the capital reserves are not sufficient for write-down.
7. Joint arrangement classification and accounting treatment
Joint arrangement can be divided into joint operation and joint venture.
Where the company, as a joint venture party of a joint arrangement, enjoys related assets of the arrangement and bears
related liabilities thereof, it is a joint operation.
The company confirms the following items related to the share of interests in joint operations, and conducts accounting
treatment in accordance with related enterprise accounting standards:
(1) Recognize the assets held separately by the Company and the assets jointly held in accordance with the share of the
Company;
(2) Recognize the liabilities assumed separately by the Company and the liabilities jointly assumed in accordance with the
share of the Company;
(3) Recognize the income generated through the sale of the Company’s share of the output of the joint operation;
(4) Recognize the income generated through the sale of the output of the joint operation in accordance with the share of the
130
2020 Annual Report of Songcheng Performance Development Co., Ltd
Company.
(5) Recognize the expenses incurred separately, and the expenses incurred in joint operation in accordance with the share of
the Company .
8. Recognition criteria of cash and cash equivalents
Cash refers to the cash on hand and deposits that are available for payment at any time of the Company. Cash equivalents refe r
to investments held by the Company featuring short duration, strong liquidity, easy conversion into cash of known amount and low
risk of changes in value.
9. Conversion of transactions and financial statements denominated in foreign currencies
(1) Foreign currency transactions
Foreign currency transactions shall be translated into RMB at the spot exchange rate on the day when the transactions
occurred.
Balance sheet date foreign currency monetary items shall be translated using the spot exchange rate at the balance sheet date.
The resulting exchange differences are recognized in profit or loss for the current period, except for those differences related to the
principal and interest on a specific-purpose borrowing denominated in foreign currency for acquisitions, construction or production
of the qualified assets, which should be capitalized as cost of the assets.
(2). Translation of foreign currency financial statements
All assets and liabilities items in balance sheet are translated based on spot exchange rate on the balance sheet date; owners'
equity items other than "undistributed profit" are translated at a spot exchange rate when accrued. The revenue and expense items
in the income statement are converted using the weighted average exchange rate which is determined on the date of the
transaction by using systematic and reasonable method.
For disposal of overseas operation, the translation difference as stated in the foreign currency financial statements relatin g to
overseas operation, is accounted for in the profit and loss account in the current period from owners' equity items.
10. Financial instruments
The Company recognizes a financial asset, financial liability or equity instrument when it becomes a party to a financial
instrument contract.
(1) Classification of the financial instruments
According to the company's business model for managing financial assets and the contractual cash flow features of financial
assets, financial assets at initial recognition are classified into: financial assets measured at amortized cost, financial assets
measured at fair value with changes recognized in other comprehensive income and financial assets measured at fair value with
changes recognized in profits and losses of the current period.
For financial assets that meet the following conditions and are not designated to be measured at fair value through the current
profit or loss, the Company classifies them as financial assets at amortized cost:
－ The business model is aimed at collecting contract cash flow;
－ Contract cash flow is the payment of principal and interest based on the outstanding pri ncipal amount.
For financial assets that meet the following conditions and are not designated to be measured at fair value through current
profit or loss, the Company classifies them as financial assets at fair value through other comprehensive income (deb t instruments).
－ The business model is aimed at both collecting contract cash flows and selling financial asset;
131
2020 Annual Report of Songcheng Performance Development Co., Ltd
－ Contract cash flow is the payment of principal and interest based on the outstanding principal amount.
The Company will, at the time of initial recognition, irrevocably designate non-trading investments in equity instruments as
financial assets measured at fair value and the change shall be included in other comprehensive income (equity instrument). T he
designation is made on the basis of independent investment, and the related investments fit the definition of an equity instrument
from an issuer’s perspective.
In addition to the aforementioned financial assets at amortized cost and at fair value through other comprehensive income,
the Company classifies all other financial assets as financial assets at fair value through current profit or loss.
The financial liabilities, when initially recognized, are classified as: financial liabilities at fair value through profit o r loss and
financial liabilities at amortized cost.
(2) Recognition and measurement of financial instruments
1) Financial assets measured at amortized cost
Financial assets at amortized cost include notes receivable, accounts receivable, other receivables, long-term receivables and
creditors investment, which shall be initially measured at fair value, and the relevant transaction expenses should be initia lly
capitalized; The accounts receivable that do not contain material financing compositions and those for which the Company decides
to not take into account the financing compositions of no more than one year shall be initially measured at the contract tran saction
price.
The interest calculated by effective interest method during the holding period is recorded into the curre nt profit and loss.
At the time of recovery or disposal, the difference between the price obtained and the book value shall be included in the
current profit or loss.
2) Financial assets (debt instruments) measured at fair value and whose changes included in other comprehensive income
Financial assets measured at fair value and its changes are included in other comprehensive income (debt instruments) include
receivables financing and investments in other creditor's rights. They are initially measured at fair value, and the relevant
transaction expenses should be initially capitalized. These financial assets are subsequently measured at fair value, and the cha nge
in fair value, other than the interest, the impairment loss or profit and the profit or loss on foreign exchange, shall be in cluded in
other comprehensive income.
Upon derecognition, the cumulative profits or losses previously included in other comprehensive income shall be removed
from other comprehensive income and included in the profit or loss for the period.
3) Financial assets (equity instruments) measured at fair and whose changes included in other comprehensive income
Financial assets at fair value through other comprehensive income (equity instruments) include investment in other equity
instruments. They are initially measured at fair value, and the transaction expenses shall be initially capitalized. These financial
assets are subsequently measured at fair value, and the change in fair value shall be included in other comprehensive income. The
dividends obtained shall be included in the profit or loss for the period.
Upon derecognition, the cumulative profits or losses previously included in other comprehensive income shall be removed
from other comprehensive income and included in the carry-forward retained earnings.
4) Financial assets measured at fair value and whose changes included in profit and loss of the current period
Financial assets at fair value through profit or loss include trading financial assets, derivative financial assets and other
non-current financial assets. They are initially measured at fair value, and the transaction expenses related to them are included in
the profit or loss for the period. These financial assets are subsequently measured at fair value, and the change in fair val ue shall be
included in the profit or loss for the period.
5) Financial liabilities measured at fair value and whose changes included in profit and loss of the current period
Financial liabilities at fair value through profit or loss include trading financial liabilities and derivative financial liabilities. They
are initially measured at fair value, and the transaction expenses related to them are included in the profit or loss for the period.
132
2020 Annual Report of Songcheng Performance Development Co., Ltd
These financial liabilities are subsequently measured at fair value, and the change in fair value shall be included in the profit or loss
for the period.
Upon derecognition, the difference between their book value and the consideration paid is included in the profit or loss for the
period.
6) Financial liabilities measured at amortized cost
Financial liabilities at amortized cost include short-term loans, notes payable, accounts payable, other payables, long-term
loans, bonds payable, and long-term payables. They are initially measured at fair value, and the transaction expense s shall be
initially capitalized.
The interest calculated by effective interest method during the holding period is recorded into the current profit and loss.
Upon derecognition the difference between the consideration paid and the book value of these financial liabilities is included
in the current profit or loss.
(3) Derecognition and transfer of financial assets
The Company derecognizes financial assets when any one of the following conditions is satisfied:
The contractual right to receive cash flows of the financial assets has been terminated;
The financial asset has been transferred and virtually all the risks and rewards related to the ownership of the financial asset
shave been transferred to the transferee;
The financial assets have been transferred, and while the Company has neither transferred nor retained virtually all of the risks
and rewards related to the ownership of the financial assets, it has not retained control of the financial assets.
At the time of the transfer of financial assets, the recognition of the financial assets shall not be terminated if the Company has
retained virtually all the risks and rewards related to the ownership of the financial assets.
The substance-over-form principle shall be adopted while making judgment on whether the transfer of financial assets satisfies
the above conditions for termination of recognition.
The transfer of financial assets can be classified into entire transfer and partial transfer. If the transfer of an entire fi nancial
asset satisfies the conditions for termination of recognition, the difference between the two amounts below shall be recorded into
profit or loss for the period:
(1) The book value of the transferred financial assets;
(2) The consideration received as a result of the transfer, and the sum of cumulative amount of fair value changes that
originally included in owner equity (the financial assets involved in the transfer are the financial assets measured at fair value and
whose changes are included in Other Comprehensive Income(de bt instruments)).
If the partial transfer of financial assets satisfies the conditions for termination of recognition, the overall book value o f the
transferred financial asset shall be apportioned according to their respective relative fair value between the recognition terminated
part and the remaining part, and the difference between the two amounts below shall be recorded into profit or loss for the current
period:
(1) The book value of recognition termination part
(2) The consideration for recognition termination part, and the sum of the cumulative amount of the recognition termination
in fair value changes that originally recorded in owner's equity (the financial assets involved in the transfer are measured at fair
value and whose changes are included in Other Comprehensive Income (debt instruments)).
Financial assets will still be recognized if they fail to satisfy the conditions for termination of recognition, with the con sideration
received recognized as a financial liability.
(4) Recognition for termination of financial liabilities
When the current obligation under a financial liability is completely or partially discharged, the recognition of the whole o r
relevant portion of the liability is terminated; an agreement is entered between the Company and a creditor to replace the original
133
2020 Annual Report of Songcheng Performance Development Co., Ltd
financial liabilities with new financial liabilities with substantially different terms, terminate the recognition of the ori ginal financial
liabilities as well as recognize the new financial liabilities.
If all or part of the contract terms of the original financial liabilities are substantially amended, the recognition of the original
financial liabilities will be terminated in full or in part, and the financial liabilities whose terms have been amended shall be
recognized as a new financial liability.
When recognition of financial liabilities is terminated in full or in part, the difference between the book value of the fina ncial
liabilities terminated and the consideration paid (including transferred non-cash assets or new financial liability) is recognized in
profit or loss for the current period.
Where the Company repurchases part of its financial liabilities, the book value of such financial liabilities will be allocated
according to the relative fair value between the continued recognized part and terminated part on the repurchase date. The
difference between the book value of the financial liabilities terminated and the consideration paid (including transferred n on-cash
assets or new financial liability) is recognized in profit or loss for the current period.
(5) Method of determining the fair values of financial assets and liabilities
The fair value of a financial instrument that is traded in an active market is determined at the quoted price in the active m arket.
The fair value of a financial instrument that is not traded in an active market is determined by using a valuation technique. The
Company uses the valuation technique when it is applicable under current conditions and there are enough available data and
other information to support and the technique should maximize the use of relevant observable. It chooses the inputs which are
consistent with the asset or liability's characteristics considered by market participants in the transaction of the relevant asset or
liability and makes the maximum use of relevant observable inputs. Unobservable inputs are used under the circumstance that the
relevant observable inputs cannot be obtained or not feasible.
(6) Test method and accounting treatment for impairment of financial assets
The company estimates the expected credit losses of financial assets measured at amortized cost, financial
assets measured at fair value and whose changes included in other comprehensive income (debt instruments)
and financial guarantee contracts on a single or combined basis.
The Company calculates the probability-weighted amount of the current value of the difference between the cash flows
receivable under the Contract and the cash flows expected to receive, and recognizes the expected credit loss, by taking into
account all the reasonable and well-founded information, including past events, current condition and forward-looking economic
situation, and weighting the risk of default.
If the credit risk of this financial instrument has been significantly increased upon initial recognition, the Company measures its
loss provision in accordance with the amount equivalent to the expected credit loss of the financial instrument throughout th e
duration; if the credit risk of this financial instrument is not significantly increased upon initial recognition, the Company will
measure the loss provision of this financial instrument by the amount of its expected credit loss in the 12 months to come. T he
increased or reversed amount of the loss provision resulting therefrom is incl uded in the current profit or loss as the impairment
loss or profit.
The Company recognizes the relative changes in the risk of default within the expected duration of financial instruments, and
assesses whether the credit risk of financial instruments has significantly increased since the initial recognition by comparing the
risk of default of financial instruments on the balance sheet date with the risk of default on the initial recognition date. If the
financial instrument becomes overdue for more than 30 days, the Company believes that the credit risk of this financial instrument
134
2020 Annual Report of Songcheng Performance Development Co., Ltd
has been significantly increased, unless there are concrete evidences that the credit risk of this financial instrument has n ot been
significantly increased upon initial recognition.
If the financial instrument carries low credit risk at the balance sheet date, the Company believes that the credit risk of t his
financial instrument is not significantly increased upon initial recognition.
If there are objective evidences showing that a certain financial asset has been subject to credit impairment, the Company will
accrue impairment provision for this financial asset on the individual asset basis. The Company will always measure the loss
provision for the accounts receivable and contract assets generated by transactions regulated by Accounting Standards for
Enterprises No. 14 - Revenue (2017), whether they contain material financing compositions or not, by the amount of the expected
credit loss throughout the duration.
The Company will always measure the loss provision for the lease receivable by the amount of the expected credit loss
throughout the duration.
The Company shall write down the book balance of a financial asset directly if it no longer reasonably expects that the contract
cash flow of the financial asset can be recovered in whole or in part.
Classify the accounts receivable, and the expected credit loss ratio for each portfolio is as follows:
Portfolio Name Basis to Determine the Portfolio Accrued method
If there is objective evidence showing that it has been
impaired, the impairment loss should be determined
Consolidation scope and accounts based on the difference between the present value of
Portfolio one
receivable from related parties the future cash flow and its book value. Provision for
bad debts shall be made. If no impairment is found
after testing, no provision for bad debts shall be made.
The accounts receivable other than
Accrued based on the comparison table of the
Portfolio two portfolio one: portfolio based on credit
expected credit loss rate over the duration
risk features by aging
The bad debt provision method of portfolio two is adopted
Credit period Expected credit loss ratio (%)
Not overdue within the credit period 3
Overdue to less than 1 year 15
Overdue to 1-2 years 25
Overdue to 2-3 years 45
Overdue to 3-4 years 60
135
2020 Annual Report of Songcheng Performance Development Co., Ltd
Credit period Expected credit loss ratio (%)
Overdue to 4-5 years 80
Overdue for more than 5 years 100
11. Inventories
(1) Classification and cost of inventory
Inventory is classified into: inventory goods, turnover materials, etc.
(2) Determination of cost
The weighted average method is applied when the inventory is issued.
(3) Basis for the determination of net realizable value and different type of inventories
Net realizable value of held-for-sale commodity stocks, such as finished goods, goods-in-stock, and held-for-sale raw materials,
during the normal course of production and operation, shall be determined by their estimated sales less the related selling
expenses and taxes; the net realizable value of material inventories, which need to be processed, during the normal course of
production and operation, shall be determined by the amount after deducting the estimated cost of completion, estimated selli ng
expenses and relevant taxes from the estimated selling price of finished goods; the net realizable value of inventories held for
execution of sales contracts or labor contracts shall be calculated on the ground of the contracted price. If an enterprise h olds more
inventories than the quantity stipulated in the sales contract, the net realizable value of the exceeding part shall be calculated on
the ground of general selling price.
The inventory falling price reserves withdrawn shall be reversed within the amount withdrawn, and the reversed amount shall
be included in current profit or loss, if the net realizable value of an inventory is higher than its book value after the withd rawal due
to the disappearance of the factors that influence the writing-down of its value.
(4) Inventory system
The perpetual inventory system is adopted.
(5) Amortization of low-value consumables and packaging materials
One-time write-off method is used for low-value consumables.
12. Contract assets
Accounting policies as of January 1, 2020
(1) Recognition methods and standards of contract assets
The Company shall show the contract assets or contract liabilities in the balance sheet in accordance with the relationship
between the performance of the contract obligations and the Customer payment. The Company shall list its right to receive
consideration due to the transfer of goods or services to the Customer (and such rights are subject to factors other than the passage
of time) as contractual assets. Contract assets and contract liabilities under the same contract shall be shown on a net basis. The
Company’s unconditional right (depending solely on the passage of time) to collect consideration from the Customer shall be s hown
separately as a receivable.
(2) Determination method and accounting treatment for the expected credit loss of contract assets
For details of the method for determining the expected credit loss of contract assets and the accounting treatment, please
refer to Note V (10) 6. "Testing method and accounting treatment method of financial asset impairment".
136
2020 Annual Report of Songcheng Performance Development Co., Ltd
13. Contract cost
Accounting policies as of January 1, 2020
Contract costs include contract performance costs and contract acquisition costs.
The Company recognizes the costs incurred for performing the contract and that not fall within the scope of inventories, fixed
assets or intangible assets as stipulated by related standards as an asset when the following conditions are met:
The cost is directly related to a current or anticipated contract.
The cost increases the Company’s future resources to perform obligations.
The cost is expected to be recovered.
The Company regards the incremental cost incurred to acquire the contract and that are expected to be recovered as contract
acquisition costs, and recognizes them as an asset.
Assets related to contract costs shall be amortized using the same basis as income recognition of goods or services related t o
the asset. However, the Company shall include the amount in current profit or loss if the amortization period of the cont ract
acquisition cost is less than one year.
The Company shall draw an impairment provision for the excess part when the book value of an asset related to the contract
cost is higher than the difference between the following two items, and recognize it as an impairment loss of the asset:
(1) The remaining consideration expected to be obtained due to the transfer of goods or services related to the asset;
(2) Estimated costs to be incurred for the transfer of goods or services related to the asset.
The Company shall reverse the impairment provision withdrawn and include it in current profit or loss if the impairment
factors of the previous period change and cause the aforementioned difference higher than the book value of the asset. Howeve r,
the book value of the asset after reverse shall not exceed the book value of the asset on the reverse date under the assumption that
no provision for the impairment is withdrawn.
14. Holding of the assets for sale
An asset whose book value is recovered mainly through the sale (including the exchange of non-monetary assets of a
commercial nature) rather than through the continuous use of a non-current asset or disposal group is classified as holding-for-sale.
A non-current asset or disposed group is classified by the Company as holding for sale if it meets the following criteria at the
same time:
(1) Immediate sale could be made under the current circumstances in accordance with the convention of selling such kind of
assets or disposal groups in similar transactions;
(2) Selling is extremely likely to occur, i.e. the Company has made a resolution on a selling plan and obtained confirmed
purchase commitments, and the selling is predicted to be completed within 1 year. If required by relevant provisions that selling
shall only be made after approved by the relevant competent authority or supervision department of the Company, such approval
should have been obtained.
For those classified as non-current assets holding for sale (excluding financial assets, deferred income tax assets) or disposal
assets, if book value is higher than the net amount after deducing sales expenses from fair value, the book value should be r evised
and written down to net amount after deducing sales expenses from fair value. The amount written down shall be recognized as
assets impairment loss and included in current profit or loss. The impairment provision of assets holding for sale should be made.
15. Long-term equity investment
(1) Joint control or significant influence criterion
137
2020 Annual Report of Songcheng Performance Development Co., Ltd
Joint control is the contractually agreed sharing of control of an arrangement, and exists only when requiring the unanimous
consent of the parties sharing control before making decisions about the relevant activities of the arrangement. The Company
together with the other joint venture parties can jointly control over the investee and are entitled to the right of the net assets of
the investee, as the investee is joint venture of the Company.
Significant influence refers to the right to participate in the financial and business decisions of the invested entity, but the
inability to control or jointly control the formulation of policies. Where the Company can exercise significant influence ove r the
investee, the investee is an associate of the Company.
(2) Determination of initial investment cost
1) Long-term equity investment formed by business combination
For long-term equity investment in a subsidiary generated due to business combinations involving entities under common
control, the share of the book value in the consolidated financial statements of the ultimate controlling party on the date of
combinations shall be taken as the initial investment cost of the long-term equity investments. For difference between the initial
cost of long-term equity investment and the book value of the consideration paid, adjustments shall be made to the equity
premiums in the capital reserve. When the equity premiums in the capital reserve are not sufficient for write-down, the retained
earnings shall be adjusted.
For long-term equity investment in a subsidiary generated due to business combinations involving entities not under common
control, the cost of the combination recognized on the date of combination shall be taken as the initial investment cost of t he
long-term equity investments.
2) Long-term equity investment made by means other than business combination
The initial cost of a long-term equity investment obtained by cash payment shall be the purchase costs actually paid.
The initial cost of investment of a long-term equity investment obtained by means of issuance of equity securities shall be the
fair value of the equity securities issued.
(3) Subsequent measurement and recognition of profit or loss
1) Long-term equity investment calculated by cost method
Long-term equity investment in subsidiaries of the company is calculated by cost method, unless the investment meets the
conditions for holding for sale. except for the actual consideration paid for the acquisition of investment or the declared b ut not yet
distributed cash dividends or profits which are included in the consideration, investment gains are recognized as the Company'
shares of the cash dividends or profits declared by the investee.
2) Long-term equity investment calculated by equity method
Long-term equity investments of associates and jointly controlled entities are calculated using equity method. Where the initial
investment cost exceeds the investment, the difference between the share of the fair value of the investee’s identifiable net assets
shall be enjoyed and no adjustment shall be made to the initial investment cost of long-term equity investment; where the initial
investment cost is less than the investment, the difference between the share of the fair value of the investee’s identifiable net
assets shall be enjoyed and be included in current profit or loss, and adjustments shall be made to the initial investment cost of
long-term equity investment.
The Company recognizes the investment income and other comprehensive income according to the shares of net p rofit or loss
and other comprehensive income realized by the investee which it shall be entitled or shared respectively, and simultaneously
makes adjustment to the book value of long-term equity investments; The book value of long-term equity investment shall be
reduced by attributable share of the profit or cash dividends for distribution declared by the investee. In relation to other changes
of owner's equity except for net profits and losses, other comprehensive income and profit distributions of the investee, the book
value of long-term equity investments shall be adjusted and included in owner’s equity.
When recognizing the amount of proportion of net profit or loss, other comprehensive income and other changes of owner’s
138
2020 Annual Report of Songcheng Performance Development Co., Ltd
equity, in the investee which it entitles, fair value of the identifiable assets of the investee at the time when the investment is
obtained shall be used as basis, and adjustment shall be made to the net profit, other comprehensive income and others of the
investee in accordance with the accounting policies and accounting period of the Company.
The Company shall be liable for net loss incurred by the Company to the joint venture or associate, and shall write it down t o
zero with the book value of the long-term equity investment and other long-term equity which substantially constitute net
investment in the joint venture or associate. Where a joint venture or associate later realizes net profits, the Company shall resume
recognition of its share of income after the share of income has made up for the unrecognized share of loss.
16. Investment property
Measurement Mode of Investment Property
Measured by cost method
Depreciation or amortization methods
Investment property refers to the real estate held to generate rental income or capital appreciation, or both, including leas ed
land use rights, land use rights held for transfer after appreciation, and leased buildings (including buildings that are lea sed after
completion of self-construction or development activities and buildings in construction or development that are used for rental in
the future).
Subsequent expenditures related to fixed assets shall be included in the cost of fixed assets when the relevant economic
benefits are likely to flow in and the cost can be measured reliably. The book value of the replaced part is derecognized. Ot her
subsequent expenditures shall be included in current profit or loss at the time of occurrence.
The Company adopts the cost mode to measure the existing investment property. Investment property measured at cost -
buildings held for leasing shall adopt the same depreciation policy for fixed assets of the company, land use rights held for leasing
shall adopt the same amortization policy for the intangible assets.
17. Fixed assets
(1) Conditions for recognition of fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of goods or services, for rental to others, or for
administrative purposes; and have a service life of more than one accounting year. Fixed assets shall be recognized when the
following conditions are met at the same time:
1) The economic benefits related to the fixed asset are likely to flow into the company;
2) The cost of the fixed asset can be reliably measured.
Fixed assets are initially measured at cost (with the influence of expected disposal costs taken into consideration).
Subsequent expenditures related to fixed assets shall be included in the cost of fixed assets when the relevant economic
benefits are likely to flow in and the cost can be measured reliably. The book value of the replaced part is derecognized. Ot her
subsequent expenditures shall be included in current profit or loss at the time of occurrence.
(2) Methods for depreciation
Fixed assets are depreciated by categories using the straight-line method, and the annual depreciation rates are determined by
categories based upon their estimated useful lives and their estimated residual values. For fixed assets with provision for
impairment, the amount of depreciation shall be determined in future periods according to the book value after deducting the
139
2020 Annual Report of Songcheng Performance Development Co., Ltd
provision for impairment and based on the usable life. Where the parts of a fixed asset have different useful lives or cause economic
benefits for the enterprise in different ways, different depreciation rates or depreciation methods shall apply, and each par t is
depreciated separately.
Category Depreciation method Useful lives of depreciation Residual Ratio Annual depreciation rate
Housing and building Straight-line method 5-35 2.8-5 19.44-2.71
General Equipment Straight-line method 3-10 2.8-10 32.40-9
Special Equipment Straight-line method 5-10 2.8-5 19.44-9.5
Machinery and equipment Straight-line method 3-10 2.8-5 32.40-9.5
Transportation Equipment Straight-line method 5-10 2.8-10 19.44-9
Others Straight-line method 5-10 2.8-5 19.44-9.5
(3) Disposal of fixed assets
Fixed assets being disposed of or not expected to generate economic benefits through use or disposal shall be derecognized.
The amount of income from the disposal, transfer, scrapping or damage of fixed assets after deducting its book value and rela ted
taxes shall be included in the current profit and loss.
18. Construction in progress
Construction in progress is measured at the actual costs incurred. The actual cost includes construction costs, installation costs,
borrowing costs that meet the capitalization conditions, and other necessary expenditures incurred before the construction i n
progress reaches its intended use status. When the construction in progress reaches its intended use status, it shall be tran sferred
to fixed assets according to budget, cost or actual contract cost of the construction project, and the depreciation of th e fixed assets
shall be accrued according to fixed assets depreciation policy of the company. When the final account of completed project is issued,
the estimated cost shall be adjusted according to the actual cost.
19. Borrowing costs
(1) Criteria for recognition of capitalized borrowing costs
For borrowing costs incurred by the Company that are directly attributable to the acquisition, construction or production of
assets qualified for capitalization, the costs will be capitalized and included in the costs of the related assets. Other borrowing costs
shall be recognized as expense in the period in which they are incurred and included in profit or loss for the current period.
Assets qualified for capitalization are assets (fixed assets, investment property, inventories, etc.) that necessarily take a substantial
period of time for acquisition, construction or production to get ready for their intended use or sale.
(2) Capitalization period of borrowing costs
The capitalization period shall refer to the period between the commencement and the cessation of capitalization of borrowing
costs, excluding the period in which capitalization of borrowing costs is temporarily suspended.
Capitalization of borrowing costs begins when the following three conditions are fully satisfied:
1) Asset expenditures have been incurred, which include the expenditures in the form of cash payment, transfer of non -cash
assets, or assumption of interest-bearing debts for construction or production of assets eligible for capi talization;
2) Borrowing costs have been incurred;
3) The purchase and construction or production activities which are necessary to prepare the asset for its intended use or sa le
have started.
140
2020 Annual Report of Songcheng Performance Development Co., Ltd
Capitalization of borrowing costs shall be suspended during periods in which the qualifying asset under acquisition and
construction or production ready for the intended use or sale.
(3) Suspension of capitalization period
Capitalization of borrowing costs shall be suspended during periods in which the acqui sition, construction or production of a
qualifying asset is interrupted abnormally, when the interruption is for a continuous period of more than 3 months; if the
interruption is a necessary step for making the qualifying asset under acquisition and construction or production ready for the
intended use or sale, the capitalization of the borrowing costs shall continue. The borrowing costs incurred during such peri od shall
be recognized as profits and losses of the current period. When the acquisition and con struction or production of the asset resumes,
the capitalization of borrowing costs commences.
(4) Calculation of capitalization rate and amount of borrowing costs
Specific borrowings for the acquisition, construction or production of assets qualif ied for capitalization, borrowing costs of the
specific borrowings actually incurred in the current period minus the interest income earned on the unused borrowing loans as a
deposit in the bank or as investment income earned from temporary investment will be used to determine the amount of
borrowing costs for capitalization.
General borrowings for the acquisition, construction or production of assets qualified for capitalization, the to -be-capitalized
amount of interests on the general borrowing shall be calculated and determined by multiplying the weighted average asset
disbursement of the part of the accumulative asset disbursements minus the specifically borrowed loans by the capitalization rate
of the general borrowing used. The capitalization rate is calculated and determined based on the weighted average actual interest
rate of general borrowing.
During the period of capitalization, the exchange balance on the principals and interests of special foreign currency borrowi ngs shall
be capitalized and shall be included in the cost of assets eligible for capitalization. The exchange balance on the principals and
interests of foreign currency borrowings other than the special foreign currency borrowings shall be included in current prof it or
loss.
20. Intangible assets
(1) Valuation method, service life, impairment test
1) Method for valuation of intangible assets
1) It shall be initially measured at cost when the company obtains intangible assets；
The costs of externally purchased intangible asset include the purchase price, relevant taxes and expenses paid, and other
expenditures directly attributed to its intended use.
2) Subsequent measurement
The service life of intangible assets shall be analyzed and judged upon acquisition.
Intangible assets with a limited service life are amortized within the term of economic benefits for the enterprise. If it is
impossible to foresee the term, it shall be regarded as an intangible asset with uncertain service life and shall not be amortized.
2) Estimated service life of intangible assets with limited service life
Item Estimated useful lives Basis
Land use rights 30-50 years The number of years is indicated on the land
certificate
Computer Software 3-10 years Benefit period
Vehicle license plate 10 years Estimated service life
At the end of each year, the service life and amortization method of the intangible assets with a limited service life are
reviewed.
141
2020 Annual Report of Songcheng Performance Development Co., Ltd
3) Judgment basis for intangible assets with uncertain service life and procedures for reviewing their service life
According to relevant regulations of Australia, there is no stipulated term of use for the land use right after purchase, and it can
be used permanently. Therefore, the company recognizes the land without a specified use term as an intan gible asset with
uncertain service life, for which no amortization is allowed.
At the end of each year, the service life of intangible assets with uncertain service life will be reviewed.
(2) Accounting policy for internal R&D expenditure
The expenses for internal research and development projects of the Company are divided into expenses in the research phase
and expenses in the development phase.
Research phase: Scheduled innovative investigations and research activities to obtain and understand scientific or
technological knowledge.
Development phase: Apply the research outcomes or other knowledge to a plan or design prior to a commercial production or
use in order to produce new or essentially-improved materials, devices, products, etc.
Specific condition for capitalizing expenditure during the development phase
Expenses in the research phase are recorded into the profits and losses for the current period when they occur. Expenditure
during the development phase that simultaneously satisfies the following conditions shall be recognized as intangible assets.
Otherwise shall be included in current profit or loss:
1) It is technically feasible to complete the intangible asset so that it can be used or sold;
2) There is intention to complete the intangible asset for use or sale;
3) The means by which intangible asset generates economic benefits, including the ability to prove that there is a market for
the products produced with the intangible asset or the existence of a market for the intangible asset itself. Where the intangible
asset is to be used internally, its usefulness can be proved;
4) The company has sufficient technical, financial and other resources to support the development of such intangible assets,
and has the ability to use or sell such intangible assets;
5) The expenditure attributed to the development stage of the intangible asset can be reliably measured.
The R&D expenditures incurred shall be included in current profit or loss if it is impossible to distinguish expenditure duri ng the
research phase and expenditure during the development phase.
21. Long-term asset impairment
Long-term assets, such as long-term equity investment, investment properties, fixed assets and construction in progress that
measured at cost, and intangible assets and oil and gas assets with limited service life, are tested for impairment if there is any
indication that an asset may be impaired on the balance sheet date. If the result of the impairment test indicates that the
recoverable amount of the asset is less than its book value, a provision for impairment and an impairment loss are recognized for
the amount by which the asset's book value exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair
value less costs to sell and the present value of the future cash flows expected to be derived from the asset. Provision for asset
impairment is determined and recognized on the individual asset basis. If it is not possible to estimate the recoverable amou nt of an
individual asset, the recoverable amount of a group of assets to which the asset belongs to is determined. A group of assets is the
smallest group of assets that is able to generate cash inflows independently.
Goodwill formed due to business combination, intangible assets with uncertain se rvice life and intangible assets that have not
yet reached serviceable conditions, shall be tested for impairment at least at the end of each year, regardless of whether th ere is
any indication of impairment.
When the Company carry out impairment test to goodwill, the Company shall, as of the purchasing day, allocate on a
reasonable basis the book value of the goodwill formed by merger of enterprises to the relevant asset groups, or if there is a
142
2020 Annual Report of Songcheng Performance Development Co., Ltd
difficulty in allocation, to allocate it to the sets of asset groups. The relevant asset group or combination of asset groups is the asset
group or combination of asset groups that can benefit from the synergies of business combination.
For the purpose of impairment test on the relevant asset groups or the sets of asset groups containing goodwill, if any
evidence shows that the impairment of asset groups or sets of asset groups related to goodwill is possible, an impairment tes t will
be made first on the asset groups or sets of asset groups not containing goodwil l, thus calculating the recoverable amount and
comparing it with the relevant book value so as to recognize the corresponding impairment loss. Asset group or combination of
group assets containing goodwill are tested for impairment and the book value and recoverable amount shall be compared. If the
recoverable amount is less than the book value, the amount of impairment loss shall be deducted and apportioned to the book
value of goodwill in asset group or combination of asset groups, before deducting to the book value of all other assets
proportionally based on the proportion of the book value of all assets other than goodwill in the asset group or combination of
asset groups.
Once the above asset impairment loss is recognized, it will not be reversed in the subsequent accounting periods.
22. Long-term prepaid expenses
Long-term prepaid expenses are expenses which have occurred but will benefit over 1 year and shall be amortized over the
current period and subsequent periods. The long-term prepaid expenses of the company include scenic animals and plants, scenic
road signs, creation of costumes and props, expenditures for improvement of leased fixed assets, house decoration fees and
long-term rental fees.
1. Amortization method
Long-term prepaid expenses are amortized evenly over the estimated benefit period
2. Amortization period
Item Estimated useful lives Basis
Scenic animals and plants 5 years Benefit period
Scenic road signs 5 years Benefit period
Creation Costume Prop 5 years Benefit period
Expenditures for improvement 3-10 years Benefit period
of leased fixed assets
House decoration fee 5-10 years Benefit period
Long-term rental fee 3-40 years Benefit period
23. Contract liabilities
Accounting policies as of January 1, 2020
The Company shall show the contract assets or contract liabilities in the balance sheet in accordance with the relationship
between the performance of the contract obligations and the Customer payment. The Company’s obligation to transfer goods or
provide services to customers for which consideration has been received or receivable are presented as contractual liabilities.
Contract assets and contract liabilities under the same contract shall be shown on a net basis.
143
2020 Annual Report of Songcheng Performance Development Co., Ltd
24. Employee remuneration
(1) Accountant arrangement method of short-term remuneration
During the accounting period when the staff provides service, the Company will recognize the short -term remuneration
actually incurred as liabilities, and the liabilities would be charged into current profits and loss or costs of assets.
The Company will pay social insurance and housing funds, and will make provision of trade union funds and staff education
costs in accordance with the requirements. During the accounting period when the staff provides service, the Company will
determine the relevant amount of employee benefits in accordance with the required provision basis and provision ratios.
The expenses on employee benefit incurred by the Company shall be included in the current profit or loss or related as set cost
based on the actual amount when actually incurred, and the non-monetary benefit shall be measured at its fair value.
(2) Accountant arrangement method of retirement benefit plan
1) Defined contribution plan (DCP)
The Company will pay basic pension insurance and unemployment insurance in accordance with the relevant provisions of the
local government for the staff. During the accounting period when the staff provides service, the Company will calculate the amount
payable in accordance with the local stipulated basis and proportions which will be recognized as liabilities, and the liabilities would
be charged into current profits and loss or costs of assets. In addition, the Company joins in corporation annuity
plan/supplementary pension insurance fund approved by related state departments. The Company conducts payment to annuity
plan/ local social insurance institution according to certain proportion of employees’ wages and corresponding expenditures a re
included in the current profit or loss or relevant asset costs.
2) Defined benefit plan
The welfare responsibilities generated from defined benefit scheme based on the formula determined by projected unit credit
method would be vested to the service period of the staff and charged into current profits and loss or costs of assets.
The deficit or surplus resulting from the present value of the defined benefit plan obligations minus the fair value of the
defined benefit plan assets is recognized as the net liability or net asset of the defined benefit plan . If there is a surplus in the
defined benefit plan, the company shall use the lower of the defined benefit plan surplus and the asset ceiling to measure the net
assets of the defined benefit plan.
All defined benefit plan obligations, including obligations expected to be paid within twelve months after the end of the annual
reporting period in which employees provide services, are based on market yield of treasury bond or high -quality corporate bond in
an active market that matches the date of the balance sheet, the period of defined benefit plan obligation and currency applied.
The service cost, net interest on net liabilities and net assets of the defined benefit plan are recorded in the current prof it and
loss or related asset cost. The changes resulting from the re-measurement of net liabilities or net assets of the defined benefit plan
are recorded in other comprehensive income and shall not be rolled back to profit and loss in subsequent accounting periods. When
the original defined benefit plan is terminated, all the part originally recorded in other comprehensive income should be carried
forward to undistributed profit.
In the settlement of the defined benefit plan, the settlement gain or loss shall be recognized according to the difference
between the present value of the defined benefit plan obligation and the settlement price determined on the settlement date.
(3) Accountant arrangement method of termination benefits
Where the Company pays termination benefit to employees, the liabilities of employee remuneration generated by
termination benefit shall be recognized at the earlier of the following date and included in the current profit or loss: when the
company cannot unilaterally withdraw termination benefit provided by labor relationship termination plan or layoff proposal; when
144
2020 Annual Report of Songcheng Performance Development Co., Ltd
the Company recognizes costs or expenses related to a restructuring of the payment of termination benefits.
25. Estimated liabilities
The Company shall recognize the obligations related to contingencies as estimate d liabilities provided that they satisfy the
following conditions:
1) The obligation is the current obligation of the company;
2) The fulfillment of this obligation is likely to result in the outflow of economic benefits from the Company;
3) The amount of the obligation can be reliably measured.
Estimated liabilities shall be initially measured at the best estimate of the expenditure required to settle the related present
obligation.
Factors pertaining to a contingency such as risk, uncertainties, and time value of money shall be taken into account as a whole
in reaching the best estimate. Where the effect of the time value of money is material, the best estimate shall be determined by
discounting the related future cash outflow.
Where some or all of the expenditure required to settle an estimated liability is expected to be reimbursed by a third party, the
reimbursement is separately recognized as an asset when it is virtually certain that the reimbursement will be received. The amount
recognized for the reimbursement is limited to the book value of the estimated liability.
On the balance sheet date, the Company shall review the book value of the estimated liabilities, and shall adjust the book
value on the basis of the current best estimate if there is conclusive evidence showing the book value cannot reflect the current
best estimate.
26. Share-based payment
The Company's share-based payment refers to a transaction in which an enterprise determines the liabilities on the basis of
equity instruments granting or bearing for the acquisition of service from its employees or other parties. The company's share
based payment is divided into the share payment settled in equity and the share based payment settled in cash.
(1) The share payment settled in equity and equity instruments
As to an equity-settled share-based payment in return for services of employees, calculation will be based on the fair value of
the equity instrument granted to the employees. Equity instruments vested immediately after the date of grant will be included in
the relevant cost or expense based on its fair value on the date of grant, and the capital reserve will be increased accordin gly. For
equity instruments to be vested after completing the service during the waiting period after the date of grant or meeting regulated
performance conditions, the Company shall include the services obtained in the current period in relevant costs or expenses a nd
increase capital reserves accordingly on each balance sheet date during the waiting period on the basis of the best estimate of the
number of viable equity instruments to be vested and the fair value on the grant date.
If the equity instrument is cancelled during the waiting period after the date of grant, the Company will treat the cancellation
of the equity instrument as accelerated vest, include the amount to be recognized in the remaining waiting period in the curre nt
profit or loss, and recognize the capital reserves simultaneously. However, if new equity instruments are vested and they are
verified at the vesting date of new equity instrument as alternatives vested to canceled equity instruments, the treatment on t he
new equity instrument is in conformity with the modified treatment on disposal of equity instrument.
27. Revenue
Accounting policies for revenue recognition and measurement
Accounting policies as of January 1, 2020
(1) Accounting policies for revenue recognition and measurement
145
2020 Annual Report of Songcheng Performance Development Co., Ltd
The Company has fulfilled its contractual obligation to recognize income when the Customer obtains control over the relevant
goods or services. Obtaining control over related goods or services means to be able to dominate the use of the goods or services
and obtain virtually all economic benefits from it.
Where the Contract contains the performance of two or more obligations, the Company shall, on the commencement date of
the Contract, apportion the transaction price to each individual performance obligation on the basis of the relative proporti on of
the individual selling price of the goods or service committed by each individual performance obligation. The Company shall
measure its income on the basis of the transaction price apportioned to each individual performance obligation.
The transaction price refers to the amount of consideration the Company is expected to be entitled to receive for the transfer
of goods or services to the Customer, excluding payments received on behalf of third parties and the amounts expected to be
refunded to the Customer. The Company determines the transaction price in accordance with Contract terms and by taking into
consideration its past practices. In determining the transaction price, it takes into consideration the impact of variable co nsideration,
material financing elements in the Contract, non-cash consideration, consideration payable to customers and other factors. The
Company determines the transaction price that includes the variable consideration at an amount not exceeding the amount of
accumulated recognized income which is not likely to be materially reve rsed when the relevant uncertainty is eliminated. Where
there are material financing components in the Contract, the Company shall determine the transaction price on the basis of the
amount payable based on the assumption that the Customer pays in cash upon obtaining control over the goods or services, and
shall amortize the difference between the transaction price and the Contract consideration by effective interest method durin g the
Contract period.
It shall be deemed as fulfilling performance obligation within a certain period of time if one of the following conditions is
satisfied. Otherwise, it shall be deemed as fulfilling performance obligation at a certain point in time:
The Customer obtains and consumes the economic benefits arising from the Company’s performance of obligations at the
same time of that the Company perform its obligations.
The Customer can control the goods under construction during the process that the Company perform its obligations.
The product produced by the Company during the performance of its obligations is irreplaceable in use, and the Company
shall be entitled to receive payment for the accumulated part of the performance completed so far during the whole Contract
period.
For obligations performed within a certain period of time, the Company shall recognize income on the basis of the
performance progress during that period, except when the performance progress cannot be reasonably determined. The Company
will adopt output method or input method to determine the performance progress by taking the nature of the goods or services
into consideration. Where the performance progress cannot be reasonably determined and the costs incurred are expected to be
compensated, the Company shall recognize income on the basis of the costs incurred until the performance progress can be
reasonably determined.
For obligations performed at a certain point of time, the Company recognizes income at the point when the Customer obtain
control over relevant goods or services. The Company takes the following indications into consideration when determining whether
the Customer has obtained control over relevant goods or services:
The Company is entitled to collect payment in respect of the goods or services immediately, i.e. the Customer is obliged to
make payment in respect of the goods or services immediately.
The Company has transferred legal ownership of the goods to the Customer, i.e. the Customer has legal ownership of the
goods.
The Company has physically transferred the goods to the Customer, i.e. the Customer has physically possessed the goods.
The Company has transferred the principal risks and rewards in the ownership of the goods to the Customer, i.e. the
Customer has obtained the principal risks and rewards in the ownership of the goods.
The Customer has received the goods or services, etc.
(2) The specific accounting policies related to the company's main activities that generate revenue are
146
2020 Annual Report of Songcheng Performance Development Co., Ltd
described as follows:
1) The principle for confirmation of ticket sales revenue
The tourists, after buying the ticket and checking in through the gate, shall have the right to visit the scenic spot and watch the
live performance. When the ticket amount has been collected or the right to receive payment has been obtained, the revenue
should be generated.
2) The principle for confirmation of e-commerce sales revenue
The economic benefits from the tickets, based on the ratio of profits sharing agreed by and between the company and each of
scenic spots, hotels or travel agencies, are expected to have flowed into the parties concerned upon the orders are generated and
the tourists have entered the park or checked in. When the ticket amount has been collected or the right to receive payment h as
been obtained, the revenue should be generated.
3) The principle for confirmation of the revenue from design and planning fee
Design and planning are to provide a package of services for other scenic spots and performance projects, including scenic spot
design and planning, theater design and planning, performance directing, plan for opening, marketing, follow-up quality
improvement and other designs and services agreed in the agreement. The revenue shall be recognized, when the company
completes the phased design, planning and upgrading according to the requi rements of the project progress, and submits the
phased results to the client and obtains its confirmation indicating that the company has completed the service of the stage.
Follow-up business management: After the relevant services have been provided, the service revenue shall be collected
according to the results as agreed in the contract. The income shall be recognized in the current period of service provided.
4) The principle for confirmation of the revenue from supporting services of scenic spots
The revenue shall be recognized when relevant services for the scenic spot have been provided and cash has been received or
the right to receive payment has been obtained.
Accounting policy prior to January 01, 2020
(1) General principle for confirmation of the revenue from sales of goods
1) The Company has transferred the major risks and rewards of ownership of the goods to the buyers ；
2) The company does not retain the continuing management rights normally associated with the ownership, nor does it
effectively control over the sold goods;
3) The amount of revenue can be reliably measured;
4) Relevant economic benefits are likely to flow into the company;
5) The costs related, incurred or to be incurred can be reliably measured.
(2) Specific principle
1) The principle for confirmation of ticket sales revenue
After tickets sold and tourists entered the park, the major risks and rewards are transferred as tourists entered the park
through the gate. The amount of ticket revenue can be reliably measured, and the payment can be received in time. The revenue
shall be recognized when relevant cost, incurred or to be incurred, can be reliably measured.
2) The principle for confirmation of e-commerce sales revenue
In accordance with the ratio of profits sharing agreed by and between the company and each of scenic spots, hotels or travel
agencies, the major risks and rewards of revenue are transferred after the order has been generated, the payment has been mad e,
and the tourists have entered the park. The revenue shall be recognized when relevant cost is reliably measured.
3) The revenue from 6.cn Internet performance platform
The company obtains revenue from the business of the 6.cn Internet performance platform. The company shall recognize
revenue, after the virtual coins of the internet performance platform obtained by registered users online or through third -party
recharge channels. The revenue shall be recognized when the virtual coins consumed on the Internet performance platform. The
amount of virtual coins not recognized as revenue and the ending balance in the account of internet performance platform shall be
recognized as advance receipts.
147
2020 Annual Report of Songcheng Performance Development Co., Ltd
4) The principle for confirmation of on-line game revenue
4.1 Under the independent operation mode, the company independently conducts game development and operation. Since
the company does not distinguish the types of consumption items (consumable items and permanent items) of the game, the
company, in the principle of prudence and based on consumption, recognizes the revenue based on the life cycle deferral of players.
The amount of virtual coins unconsumed and remained in the account at the end of the period is confirmed as advance payment.
The amount of revenue that has not yet been included in player life cycle amortization is recognized as deferred revenue.
4.2 Under the self-development mode, the company entrusts other companies to operate, without assuming the main
responsibility for operation. The operating revenue is recognized in accordance with the net method, namely the share payment
paid by the cooperative operator.
4.3 Under the authorized operation mode, the company shall not take the main responsibility for operation in accordance
with the agreement. The revenue is recognized in accordance with the net method, namely the share payment paid by the
cooperative operator. Among them, the exclusive agency and the company recognizes the revenue based on the life cycle deferra l of
players. The amount not included in revenue shall be recognized as deferred income.
4.4 Principles for confirmation of game copyright revenue: Under the authorized business model, the company shall
undertake the obligations of technical support, game upgrades and others. The company recognizes revenues based on the
straight-line method during the revenue period agreed herein. For payments that have been received and have not yet been
authorized to operate, it shall be recognized as deposit received. The amount that has not been amortized and included in the
income shall be recognized as deferred income.
4.5 Revenue from technical service fee: When the company completes the technical services, the revenue shall be recognized
based on the amount confirmed by both parties.
5) Principle for confirmation of the revenue from design and planning fee
After the program has been filmed and shown on TV, on-line cinema, theater and network, the revenue shall be recognized
based on the actual amount confirmed by both parties and the amount calculated by the corresponding accounting method.
6) Principle for confirmation of the revenue from design planning fee
Design and planning are to provide package design and planning services for other scenic spots and performance projects,
including scenic spot design and planning, theater design and planning, performance creation and costume props design, openin g
planning, market promotion planning and follow-up quality improvement services, etc. which are agreed in the agreement. As a
package of services has the following characteristics:
1) The labor service at each stage has an independent implementation plan and process; 2) The results of ea ch stage are
agreed and confirmed by the client; 3) The revenue and cost of the labor service at each stage can be individually identified .
Therefore, the revenue from package design and planning services is recognized in stages. It indicates that the comp any has
completed the stage, when the company completes the staged design, planning and improvement based on the project progress
requirements. At the same time, the company shall submit the staged results to the client and obtain confirmation from the cl ient.
The revenue shall be recognized when the content and amount of the labor services can be reliably measured, relevant economic
benefits can flow into the company, and relevant costs can be reliably measured.
7) Principle for confirmation of the revenue from supporting transportation services in scenic spots
Coupon ticket of scenic spot and transportation services: The company and the scenic spot recognize revenue based on the
sharing ratio agreed by both parties provided that the main risks and rewards of the revenue is transferred, the order has been
generated, the price has been paid, and the tourists have entered the park. The revenue shall be recognized when relevant cos t is
reliably measured.
Tourists purchase separately after entering the scenic spot: The main risks and rewards of revenue is transferred, after the
order has been generated, the price has been paid, and the tourists have entered the park. The revenue shall be recognized when
relevant costs can be reliably measured.
(3) Principle for confirmation and measurement of the revenue from the transfer of asset use rights
148
2020 Annual Report of Songcheng Performance Development Co., Ltd
When the economic benefits related to the transaction are likely to flow into the enterprise and the amount of revenue can
be measured reliably, the amount of revenue from transferring the right to use assets shall be determined in the following
situations:
1) The amount of interest income shall be calculated and determined according to the term of the company’s monetary funds
used by others and the actual interest rate.
2) The amount of usage fee revenue shall be calculated and determined according to the charging time and method agreed in
relevant contract or agreement.
28. Government grants
(1) Type
Government grants refer to the monetary or non-monetary assets obtained free of charge by the company from the
government. They are divided into government grants related to assets and government grants related to revenue.
Government grants related to assets refer to government grants acquired by the Company for the p urpose of purchasing or
constructing or otherwise forming long-term assets. Government grants related to revenue refer to the government grants other
than those related to assets.
(2) Confirmation of time point
The specific standards for government grants related to assets are: The construction of the assets granted to enterprises.
Time for confirming the government grants related to assets: the relevant assets reach the intended use state
(3) Accounting treatment
Accounting treatment of the government grants related to assets: They shall be recognized as deferred income when obtained.
After the relevant assets reach the intended use state, they shall be recognized as current profits and losses in installment s
according to the method of average amortization of asset service life. For those assets related to daily activities of the company,
they shall be included in other income. For those assets that are not related, they shall be included in non -operating income;
The specific standards for government grants related to revenue are: The expenses or losses of the compensated enterprise
Where the government documents fail to specify the recipient of grants, the company shall classify the government grants as
assets related or income related in accordance with the basis below: The government grants as a whole shall be classified as
government grants related to revenue.
The time of the confirmation of government grants related to revenue: Related expenses or losses occur.
Accounting treatment of government grants related to revenue: Those used to compensate relevant costs or losses of the
company in subsequent periods, shall be recognized as deferred income when obtained. They shall be included in the current pr ofit
and loss when related costs or losses are confi rmed. For those assets related to daily activities of the company, they shall be
included in other income. For those assets that are not related, they shall be included in non -operating income; For those assets
used to compensate related costs or losses incurred of the company, they shall be directly included in the current profit and loss
when obtained. For those assets related to daily activities of the company, they shall be included in other income. For those assets
not related, they shall be included in non-operating income.
29. Deferred income tax assets/liabilities
Income tax includes current income tax and deferred income tax. The Company will include current income tax and deferred
income tax in the current profit or loss, except for income tax arising from business combination and transaction or event directly
included in the owners’ equity (including other comprehensive income).
Deferred income tax assets and deferred income tax liabilities shall be calculated and recognized on the basis of the difference
(temporary difference) between the tax basis of the assets and liabilities and their book value.
Deferred income tax assets are recognized to the extent that it is probable that future taxable profits will be available aga inst
149
2020 Annual Report of Songcheng Performance Development Co., Ltd
which deductible temporary differences can be utilized. For deductible losses and tax credits that can be reversed in the future
period, deferred tax assets shall be recognized to the extent that it is probable that taxable profit will be available in th e future to
offset the deductible losses and tax credits.
Save as the exceptions, deferred income tax liabilities shall be recognized for the taxable temporary difference.
Special circumstances in which deferred income tax assets or deferred income tax liabilities are not recogn ized include:
Initial recognition of goodwill;
Transaction or event that is not a business combination and would not affect accounting profit and taxable income (or
deductible loss) at the time of occurrence.
For taxable temporary differences related to investments in subsidiaries, associates and joint ventures, deferred income tax
liability is recognized, unless the Company can control the timing of reversal of such temporary differences and such tempora ry
differences are not likely to be reversed in the foreseeable future. For deductible temporary differences related to the investments
of subsidiaries, associates and joint ventures, deferred tax asset is recognized when the temporary differences are likely to be
reversed in the foreseeable future and the taxable income amount used to offset the deductible temporary differences is likely to
be obtained in the future.
On the balance sheet date, deferred income tax assets and deferred income tax liabilities shall be, as stipulated by tax law,
measured by the applicable tax rate of the period of expected recovery of the relevant assets or settlement of the relevant
liabilities.
On the balance sheet date, the Company reviews the book value of the deferred income tax assets. The book value of the
deferred income tax asset will be written down if sufficient taxable income is not likely to be obtained to offset the benefit of the
deferred income tax asset in the future period. The write-down amount will be reversed when sufficient taxable income is likely to
be obtained.
After granted the legal rights of net settlement and with the intention to use net settlement or obtain assets and repay debt at
the same time, the net amount after offsetting its current income tax assets and current income tax liabilities shall be recorded.
On the balance sheet date, the deferred income tax assets and deferred income tax liabilities are presented in net amount
after set-off when both of the following conditions are satisfied:
The taxpayer has the legal right to settle the current income tax assets and current income tax liabilities on a net basis;
Deferred income tax assets and deferred tax liabilities are related to the income tax to be paid by the same entity liable to pay
tax to the same tax collection and management authority or related to different entities liable to pay tax. The relevant entity liable
to pay tax is intended to apply net settlement of current income tax assets and liabilities or, at the same time, obtain asse ts and
repay debt in every future period that deferred income tax assets and liabilities with importance would be reversed.
30. Lease
(1) Accounting of operating lease
1) The lease fee paid by the company for operating lease of assets shall be included in current expenses by amortizing on a
straight-line basis during the entire lease period without deducting the rent-free period. Initial direct costs that are attributable to
an operating lease incurred by the Company are charged to current profit and loss.
When the lesser bears the lease related expenses which should be undertaken by the Company, the Company shall deduct this
part of expense from the rent and amortize the net amount over the lease term.
2) The lease fee charged by the company for leasing its assets shall be recognized as leasing income by amort izing on a
straight-line basis during the entire lease period without deducting the lease-free period. The initial direct fee related to the leasing
transactions paid by the Company shall be charged to current expenses; if the mount is significant, it shal l be capitalized and
charged to current income evenly on the same basis as the leasing income is recognized over the lease term.
150
2020 Annual Report of Songcheng Performance Development Co., Ltd
When the Company bears the lease related expenses which should be undertaken by the lessee, the Company shall deduct this
part of expense from the rent income, and amortize the net amount over the lease term.
31. Segmental reporting
The company determines the operating segment based on the internal organizational structure, management requirements,
and internal reporting system. The segmental reporting is confirmed on operating segment basis, and segment information shall be
disclosed.
The operating segment refers to the components of the company that meet the following conditions simultaneously:
(1) The constituent part shall have income and expenses in the daily activities;
(2) The management of the company can regularly evaluate the operating results of this constituent part and determine the
allocation of resources to it and evaluate its performance;
(3) The company can obtain accounting information of the financial status, operating results, cash flow and etc., of the
constituent part.
If two or more operating segments have similar economic features and meet certain conditions, they can be combined into
one operating segment.
32. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
√ Applicable □ Not applicable
1) Implementation of "Accounting Standards for Business Enterprises No. 14 - Revenue" (revised in 2017) (hereinafter referred
to as "New Revenue Standards")
The Ministry of Finance revised the "Accounting Standards for Business Enterprises No. 14 - Revenue" in 2017 The revised
standards stipulate that for the first implementation of the standards, the amount of retained earnings and other related items in
the financial statements at the beginning of the year should be adjusted according to the cumulative effects, and the informa tion
for the comparable period should not be adjusted.
This Company implemented the new revenue standards since January 1, 2020. According to the standards, the company only
adjusted the retained earnings and other related items in the financial statements at the beginning of the year 2020 for the
cumulative effects of contracts that have not been completed on the date of first implementation, and the comparative financial
statements were not adjusted. These standards have the following major effects:
Affected Amount of Balance on
Content and Reasons for Change in Statements January 1, 2020
Approval process
Accounting Policies Affected Consolidated Parent
Subsidiaries company
Received
-311,838,903.34 -731,628.89
Prepayments
(1) The advance payments related to the The 6th meeting of
Contract
contractual income are reclassified into the 7th Board of 294,302,487.38 710,319.31
liabilities
the contractual liabilities. Directors
Other Current
17,536,415.96 21,309.58
Liabilities
Compared with the original revenue standards, implementation of the new revenue standards has the following effects on the
relevant items of the financial statements in 2020 (increase/(decrease)):
151
2020 Annual Report of Songcheng Performance Development Co., Ltd
Balance Sheets Items Affected Affected Amount of Balance on Thursday, December 31, 2020
Consolidated Subsidiaries Parent company
Contract liabilities 188,550,237.52
Received Prepayments -192,064,139.60
Other Current Liabilities 3,513,902.08
2) Implementation of "Accounting Standards for Business Enterprises Interpretation No. 13"
The Ministry of Finance issued the "Accounting Standards Interpretation for Business Enterprises No. 13" (CaiKuai [2019] No.
21, hereinafter referred to as "Interpretation No. 13") on December 10, 2019, which came into force on January 1, 2020.
Retrospective adjustment was not required.
① Identification of Related Parties
Interpretation No. 13 clarifies that the following circumstances constitute a related party: a joint venture or affiliated bu siness
between an enterprise and other member units (including parent companies and subsidiaries) of the enterprise grou p to which it
belongs; a joint venture of the enterprise and other joint ventures or affiliated business. In addition, Interpretation No. 1 3 also
clarifies that only two or more companies that are only significantly affected by one party do not constitute a related party. It also
adds that affiliated business includes affiliated business and their subsidiaries, and joint ventures include joint ventures and their
subsidiaries.
② Definition of Business
Interpretation No. 13 completes the three elements of business composition, refines the judgment conditions of business
composition, and at the same time introduces the "concentration ratio test" option to simplify to a certain extent the proble ms
such as judgment of whether a combination obtained under the same control constitutes a business, etc.
The company implemented Interpretation No. 13 since January 1, 2020, and the comparative financial statements were not
adjusted. The implementation of Interpretation No. 13 did not have significant impact on the compan y’s financial status and
operating results.
3) Implementation of the "Interim Provisions on Accounting Treatment of Carbon Emission Rights Trading"
On December 16, 2019, the Ministry of Finance issued the "Interim Provisions on Accounting Treatment of Carb on Emission
Rights Trading" (CaiKuai [2019] No. 22), which is applicable to related companies in the key emission units (hereinafter refe rred to
as key emission companies) which operate carbon emission rights trading business in accordance with the "Interi m Measures for
the Management of Carbon emission Rights Trading”. This provision came into effect on January 1, 2020, and key emission
companies should adopt prospective application to apply this provision.
The company implemented this provision since January 1, 2020, and the comparative financial statements were adjusted. The
implementation of this provision did not have significant impact on the company’s financial status and operating results.
4) Implementation of the "Provisions on accounting treatment of rent concessions related to COVID-19"
On June 19, 2020, the Ministry of Finance issued the "Provisions on accounting treatment of rent concessions related to
COVID-19" (CaiKuai (2020) No. 10), which came into effect on June 19, 2020, allowing companies to adjust related rent concessions
that occurred between January 1, 2020 and the implementation date of this provision. According to this provision, for rent
concessions directly caused by COVID-19 that meet the conditions, for example, rent remission and deferred payment of rent,
companies can choose to adopt simplified methods for accounting treatment.
The company adopts the simplified method for accounting all rent concessions within the scope the provision, and adjusted
the relevant rent concessions from January 1, 2020 to the date of implementation of the provision accordingly.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down the
operating costs, management expenses and sales expenses for the current period in the total amount of RMB 13,042,042.83.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down the
operating costs for the current period, such rent simplification had no significant impact on the Company.
152
2020 Annual Report of Songcheng Performance Development Co., Ltd
(2) Changes in significant accounting estimates
□ Applicable √ Not applicable
There were no changes in significant accounting estimates during the reporting period.
(3) Since 2020, the Company implemented new revenue standards and new leasing standards for the first
time, and adjusted the items related to financial statements at the beginning of the year.
Applicable
Whether the accounts of the balance sheet at the beginning of the year shall be adjusted
√ Yes □ No
Consolidated Balance Sheet
Unit: RMB
Item December 31, 2019 January 1, 2020 Adjusted amount
Current Assets:
Cash and Bank Balances 1,785,124,821.87 1,785,124,821.87
Deposit Reservation for
Balance
Loans to Banks and
Other Financial Institutions
Trading Financial Assets 854,108,086.54 854,108,086.54
Derivative Financial
Assets
Note’s receivable
Accounts receivable 5,337,855.43 5,337,855.43
Receivables Financing
Prepayments 17,221,603.54 17,221,603.54
Premium Receivable
Reinsurance Accounts
Receivable
Reinsurance Contract
Reserves Receivable
Other Receivables 125,573,266.78 125,573,266.78
Including: interest
receivable
Dividends
Receivable
Buying Back the Sale of
153
2020 Annual Report of Songcheng Performance Development Co., Ltd
Financial Assets
Inventory 6,110,221.56 6,110,221.56
Contract Assets Not applicable
Holding for-sale assets
Non-current Assets Due
within 1 Year
Other Current Assets 127,570,975.96 127,570,975.96
Subtotal of Current Assets 2,921,046,831.68 2,921,046,831.68
Non-current Assets:
Granting of loans and
advances
Investment in Creditor's
Rights
Investment in Other
Creditor's Rights
Long-term Receivables
Long-term Equity
3,468,596,165.08 3,468,596,165.08
Investment
Investment in Other
300,959,931.64 300,959,931.64
Equity Instruments
Other Non-current
Financial Assets
Investment Property
Fixed Assets 2,311,251,277.89 2,311,251,277.89
Projects under
370,000,233.10 370,000,233.10
Construction
Productive Biological
Assets
Oil and gas assets
Right-of-use Assets
Intangible Assets 1,498,490,129.82 1,498,490,129.82
Development
Expenditure
Goodwill 28,078,665.69 28,078,665.69
Long-term unamortized
112,440,627.02 112,440,627.02
expenses
Deferred Income Tax 9,148,452.39 9,148,452.39
154
2020 Annual Report of Songcheng Performance Development Co., Ltd
Assets
Other Non-current
21,064,619.27 21,064,619.27
Assets
Subtotal of Non-current
8,120,030,101.90 8,120,030,101.90
Assets
Total Assets 11,041,076,933.58 11,041,076,933.58
Current Liabilities:
Short-term loan
Borrowings from the
Central Bank
Borrowings from Banks
and Other Financial
Institutions
Transactional financial
liabilities
Derivative Financial
Liabilities
Notes Payable
Accounts Payable 300,656,879.62 300,656,879.62
Received Prepayments 351,733,456.28 39,894,552.94 -311,838,903.34
Contract liabilities Not applicable 294,302,487.38 294,302,487.38
Financial Assets Sold for
Repurchase
Deposit Taking and
Interbank Deposit
Receiving from
Vicariously Traded Securities
Receiving from
Vicariously Sold Securities
Payroll payable 26,737,888.43 26,737,888.43
Tax Payable 22,614,171.64 22,614,171.64
Other Payables 63,299,348.02 63,299,348.02
Including: interest
payable
Dividends
Payable
Service Charge and
155
2020 Annual Report of Songcheng Performance Development Co., Ltd
Commission Payable
Reinsurance Accounts
Payable
Holding for-sale
liabilities
Non-current Liabilities
Due within 1 Year
Other Current Liabilities 17,536,415.96 17,536,415.96
Subtotal of Current Liabilities 765,041,743.99 765,041,743.99
Non-current Liabilities:
Insurance Contract
Reserves
Long-term loan
Bonds Payable
Including: Preferred
Stocks
Perpetual
Bonds
Lease Liabilities
Long-term Payables
Long-term payroll
payable
Expected Liabilities
Deferred Income 382,872,318.90 382,872,318.90
Deferred Income Tax
10,771,548.18 10,771,548.18
Liabilities
Other Non-current
Liabilities
Subtotal of Non-current
393,643,867.08 393,643,867.08
Liabilities
Total Liabilities 1,158,685,611.07 1,158,685,611.07
Shareholders' Equity:
Share Capital 1,452,607,800.00 1,452,607,800.00
Other Equity
Instruments
Including: Preferred
Stocks
156
2020 Annual Report of Songcheng Performance Development Co., Ltd
Perpetual
Bonds
Capital Reserves 2,476,312,069.09 2,476,312,069.09
Less: Treasury Share
Other Comprehensive
-8,681,151.59 -8,681,151.59
Incomes
Special Reserves
Surplus Reserves 517,673,268.35 517,673,268.35
General Risk Reserves
Undistributed Profits 5,176,157,180.79 5,176,157,180.79
Total Shareholders' Equity
Attributable to the Parent 9,614,069,166.64 9,614,069,166.64
Company
Minority Shareholders'
268,322,155.87 268,322,155.87
Equity
Total Shareholders' Equity 9,882,391,322.51 9,882,391,322.51
Total Liabilities and
11,041,076,933.58 11,041,076,933.58
Shareholders' Equity
Balance Sheet of the Parent Company
Unit: RMB
Item December 31, 2019 January 1, 2020 Adjusted amount
Current Assets:
Cash and Bank Balances 645,534,966.84 645,534,966.84
Trading Financial Assets 351,492,520.54 351,492,520.54
Derivative Financial
Assets
Note’s receivable
Accounts receivable 1,269,835.09 1,269,835.09
Receivables Financing
Prepayments 2,458,855.65 2,458,855.65
Other Receivables 1,100,294,815.74 1,100,294,815.74
Including: interest
receivable
Dividends
Receivable
Inventory 2,465,844.42 2,465,844.42
157
2020 Annual Report of Songcheng Performance Development Co., Ltd
Contract Assets Not applicable
Holding for-sale assets
Non-current Assets Due
within 1 Year
Other Current Assets 1,671,867.65 1,671,867.65
Subtotal of Current Assets 2,105,188,705.93 2,105,188,705.93
Non-current Assets:
Investment in Creditor's
Rights
Investment in Other
Creditor's Rights
Long-term Receivables
Long-term Equity
6,941,849,814.49 6,941,849,814.49
Investment
Investment in Other
294,665,442.88 294,665,442.88
Equity Instruments
Other Non-current
Financial Assets
Investment Property
Fixed Assets 503,463,063.75 503,463,063.75
Projects under
59,331,122.60 59,331,122.60
Construction
Productive Biological
Assets
Oil and gas assets
Right-of-use Assets
Intangible Assets 145,128,033.35 145,128,033.35
Development
Expenditure
Goodwill
Long-term unamortized
10,183,821.75 10,183,821.75
expenses
Deferred Income Tax
7,476,137.89 7,476,137.89
Assets
Other Non-current
9,838,928.50 9,838,928.50
Assets
Subtotal of Non-current 7,971,936,365.21 7,971,936,365.21
158
2020 Annual Report of Songcheng Performance Development Co., Ltd
Assets
Total Assets 10,077,125,071.14 10,077,125,071.14
Current Liabilities:
Short-term loan
Transactional financial
liabilities
Derivative Financial
Liabilities
Notes Payable
Accounts Payable 44,171,004.81 44,171,004.81
Received Prepayments 22,214,761.65 21,483,132.76 -731,628.89
Contract liabilities Not applicable 710,319.31 710,319.31
Payroll payable 12,673,534.31 12,673,534.31
Tax Payable 4,818,330.21 4,818,330.21
Other Payables 1,953,433,149.11 1,953,433,149.11
Including: interest
payable
Dividends
Payable
Holding for-sale
liabilities
Non-current Liabilities
Due within 1 Year
Other Current Liabilities 21,309.58 21,309.58
Subtotal of Current Liabilities 2,037,310,780.09 2,037,310,780.09
Non-current Liabilities:
Long-term loan
Bonds Payable
Including: Preferred
Stocks
Perpetual
Bonds
Lease Liabilities
Long-term Payables
Long-term payroll
payable
159
2020 Annual Report of Songcheng Performance Development Co., Ltd
Expected Liabilities
Deferred Income 5,620,598.89 5,620,598.89
Deferred Income Tax
9,983,693.86 9,983,693.86
Liabilities
Other Non-current
Liabilities
Subtotal of Non-current
15,604,292.75 15,604,292.75
Liabilities
Total Liabilities 2,052,915,072.84 2,052,915,072.84
Shareholders' Equity:
Share Capital 1,452,607,800.00 1,452,607,800.00
Other Equity
Instruments
Including: Preferred
Stocks
Perpetual
Bonds
Capital Reserves 2,478,350,525.70 2,478,350,525.70
Less: Treasury Share
Other Comprehensive
31,870,051.79 31,870,051.79
Incomes
Special Reserves
Surplus Reserves 517,673,268.35 517,673,268.35
Undistributed Profits 3,543,708,352.46 3,543,708,352.46
Total Shareholders' Equity 8,024,209,998.30 8,024,209,998.30
Total Liabilities and
10,077,125,071.14 10,077,125,071.14
Shareholders' Equity
(4). Explanation of compared data before and after the adjustment according to the first implementation of
the new revenue recognition standard and the new lease accounting standard in 2020
□ Applicable √ Not applicable
VI. Taxes
1. Major categories of taxes and tax rates
Tax Type Taxation basis Tax rate
160
2020 Annual Report of Songcheng Performance Development Co., Ltd
According to the provisions of the tax law,
the sales tax shall be calculated on the
basis of the income by selling goods and Simple levy 3%, 5%
VAT taxable services. After deducting the input General taxpayer 6%
tax that is allowed to be deducted from General taxpayers 16%, 13%, 10%, 9%
the sales tax in the current period, the
difference shall be the value added tax
Calculated and paid based on the actual
Urban Maintenance and Construction Tax 5%, 7%
value-added tax and consumption tax
25%, please refer to below table for details
Enterprise Income Tax Calculated based on the taxable income
of different tax rates
Lease is based on rental income; self-use
House property tax fixed assets are based on the original value 12%, 1.2%
of fixed assets
Calculated and paid based on the actual
Education Surcharges 5%
value-added tax and consumption tax
If there are taxpayers with different corporate income tax rates, the disclosure shall be explained:
Name of taxpayer Income tax rate
Sanya Romance Tourism Performance Co., Ltd. 15%
Lijiang Chama Ancient City Tourism Development Co., Ltd 15%
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd 15%
Hangzhou Songcheng Tourism Development Co., Ltd 15%
Jiuzhaigou Tibetan Mystery Culture Co., Ltd 15%
Hangzhou Songcheng Technology Development Co., Ltd. 15%
Songcheng Performance International Development Co., Ltd. Local tax rate 16.50%
Songcheng (Australia) Holdings Pty Ltd Less than AUD 10 million, tax rate 27.5%
Songcheng (Australia) Entertainment Pty Ltd. Less than AUD 10 million, tax rate 27.5%
Songcheng Performance Development (Shanghai) Co., Ltd. The tax rate for small and micro enterprise
Guilin Lijiang Romance Performance Development Co., Ltd 15%
Songcheng Dumuqiao Network Co., Ltd. 15%
Xi'an Romance Performance Development Co., Ltd 15%
Songcheng Holdings (Thailand) Co., Ltd. Tax rate of Thailand 15%
Songcheng (Pattaya) International Culture Co., Ltd. Tax rate of Thailand 15%
2. Preferential tax rate
Preferential value-added tax:
161
2020 Annual Report of Songcheng Performance Development Co., Ltd
According to the "Announcement of the Ministry of Finance and the State Administration of Taxation on Supporting Tax
Policies for the Prevention and Control of the Novel Coronavirus Pneumonia Epidemic" (No. 8 of Year 2020), s tarting from January 1,
2020, Taxpayer’s income from providing life services and public transportation services shall be exempted from value-added tax.
According to the "Announcement of the Ministry of Finance and the State Administration of Taxation on Su pporting Individual
Industrial and Commercial Households Resuming Work and Resumption of Value -Added Tax Policies"( Caishui No. 13 of Year 2020),
3% taxable sales income is applicable to small-scale taxpayers, and value-added tax of 1% is applied.
Preferential of property tax and land use tax：
Companies that have business difficulties due to epidemic shall be exempted from the property tax and land use tax that
should be paid, which shall be subject to local preferential policies.
Preferential corporate income tax rate:
Lijiang Chama Ancient City Tourism Development Co., Ltd, Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd, Jiuzhaigou
Tibetan Mystery Culture Co., Ltd, Guilin Lijiang Romance Performance Development Co., Ltd and Xi'an Romance Performa nce
Development Co., Ltd. enjoy the preferential tax policy of west development, which corporate income tax rate is 15%.
Songcheng Tourism Development Co., Ltd., Hangzhou Songcheng Technology Development Co., Ltd, and Songcheng Dumuqiao
Network Co., Ltd. are high-tech enterprises, which corporate income tax rate is 15% in 2020.
According to "Notice on the Hainan Free Trade Port’s Preferential Policies on Corporate Income Tax"( Caishui No. 31 of Year
2020), from January 1, 2020 to December 31, 2024, enterpri ses that are registered in Hainan Free Trade Port with substantial
operation record are levied at a reduced rate of 15% for their corporate income. In addition, Sanya Romance Tourism Performan ce
Co., Ltd obtained the "High-tech Enterprise Certificate" on December 1, 2020, which is valid for three years. For Sanya Romance
Tourism Performance Co., Ltd., the corporate income tax was levied at the rate of 15% in 2020.
According to "Notice of the Ministry of Finance and the State Administration of Taxation on Preferential Corporate Income Tax
Policies for the Two Special Economic Development Zones Kashgar and Horgos, in Xinjiang"( Caishui No. 112 of Year 2011), duri ng
January 1, 2010 to December 31, 2020, the newly established enterprise in two special economic d evelopment zones of Kashgar
and Horgos in Xinjiang that fall within the scope of the "Catalogue of Enterprise Income Tax Preferences for Key Industries i n
Difficult Areas in Xinjiang", shall be exempted for corporate income tax for future five years starti ng from the tax year in which the
first production and operation income is obtained. The Songcheng Technology Development Co., Ltd., Songcheng Tourism
Development Co., Ltd., Songcheng Performance Management Co., Ltd. (Horgo Headquarters), Songcheng Brand Management Co.,
Ltd. and Romance Art Management Co., Ltd. subordinate to the company meet the conditions of the preferential policy , and shall
be exempted from corporate income tax in 2020.
According to the "Notice of the Ministry of Finance and the State Administration of Taxation on the Implementation of
Inclusive Tax Reduction and Exemption Policies for Small and Micro Enterprises" (Caishui No.13 of Year 2019) ，for the portion of
annual taxable income of small and low profit enterprises that is less than RMB 1 million shall be included in the taxable income at a
reduced rate of 25%, and the enterprise income tax shall be paid at the tax rate of 20%. For the portion of the annual taxabl e
income exceeding RMB 1 million but not exceeding RMB 3 million, it shall be included in taxable income at a reduced rate of 50%,
and the corporate income tax is paid at the tax rate of 20%. The execution period is from January 1, 2019 to December 31, 202 1.
The company that meets the requirements of small and micro enterprises of this year is: Songcheng Performance Development
(Shanghai) Co., Ltd.
VII. Notes to the Items in the Consolidated Financial Statement
1. Cash and bank balances
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
162
2020 Annual Report of Songcheng Performance Development Co., Ltd
Cash on Hand 2,437,262.81 2,237,068.96
Bank Balance 1,285,458,896.93 1,780,608,638.49
Other Cash and Bank Balances 49,880,094.24 2,279,114.42
Total 1,337,776,253.98 1,785,124,821.87
Including: Total Amount Deposited in
116,361,545.59 180,380,176.66
Overseas Banks
2. Trading Financial Assets
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Financial assets at fair value through profit
335,217,557.68 854,108,086.54
or loss in this period
Including:
Investment in equity instruments 172,445,378.26 110,024,148.79
Derivative Financial Assets 6,589,730.08
Bank financial products 156,182,449.34 744,083,937.75
Financial assets measured in fair value
with changes recognized in current profit
and loss
Including:
Total 335,217,557.68 854,108,086.54
3. Accounts receivable
(1) Categorical disclosure of accounts receivable
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Book balance Bad debt provision Book balance Bad debt provision
Category
Accrued Book value Accrued Book value
Amount Percentage Amount Amount Percentage Amount
proportion proportion
Including:
Accounts
receivables with
the bad debt
6,285,542.60 100.00% 398,530.24 6.34% 5,887,012.36 5,547,592.45 100.00% 209,737.02 3.78% 5,337,855.43
provision accrued
based on
combinations
163
2020 Annual Report of Songcheng Performance Development Co., Ltd
Including:
Combination of
credit risk
6,285,542.60 100.00% 398,530.24 6.34% 5,887,012.36 5,547,592.45 100.00% 209,737.02 3.78% 5,337,855.43
characteristics by
age
Total 6,285,542.60 100.00% 398,530.24 5,887,012.36 5,547,592.45 100.00% 209,737.02 5,337,855.43
Bad debt provision based on combinations
Among them: combination of credit risk characteristics by age:
Unit: RMB
Balance at the End of the Period
Name
Book balance Bad debt provision Accrued proportion
Within credit period 4,643,522.08 139,305.67 3.00%
Credit period overdue within 1
1,603,495.69 240,524.36 15.00%
year
Credit period overdue within 1
20,679.83 5,169.96 25.00%
to 2 years
Credit period overdue within 2
7,845.00 3,530.25 45.00%
to 3 years
Credit period overdue within 3
60.00%
to 4 years
Credit period overdue within 4
80.00%
to 5 years
Credit period overdue for more
10,000.00 10,000.00 100.00%
than 5 years
Total 6,285,542.60 398,530.24 --
Please refer to the disclosing methods of other receivables for the information disclosure of bad debts provisions, if the ba d debt
provisions of accounts receivable are made according to the general model of expected credit losses:
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging Book balance
Within 1 year 6,143,007.77
1 to 2 years 124,689.83
2 to 3 years 7,845.00
3 to 4 years
164
2020 Annual Report of Songcheng Performance Development Co., Ltd
4 to 5 years
5 years or above 10,000.00
Total 6,285,542.60
(2) Provision for bad debts accrued, recovered or reversed in this period
Unit: RMB
Balance at the Amount of Changes in the Current Period
Balance at the
Category Start of the Recovered or
Accrued Written Off Others End of the Period
Period Reversed
Provision for bad
debts of accounts 209,737.02 188,793.22 398,530.24
receivable
Total 209,737.02 188,793.22 398,530.24
(3) Accounts receivable actually written off in this period
There are no accounts receivable actually written off in the current period.
(4) Accounts receivable of the top five closing balances collected by debtors
Unit: RMB
Proportion of the total accounts
Accounts receivable at the end of Bad debt provision at the end of
Name of Unit receivable at the end pf the
the period the period
period
Alipay (China) Network
4,334,670.63 68.96% 130,040.12
Technology Co., Ltd.
Henan Longgui Cultural
Tourism Development 557,438.58 8.87% 82,958.13
Co., Ltd.
Tenpay Payment
313,622.60 4.99% 9,408.68
Technology Co., Ltd.
Yangshuo County
183,680.00 2.92% 17,991.60
Government Office
Qingdao Yilu International
170,233.44 2.71% 25,535.02
Travel Agency Co., Ltd.
Total 5,559,645.25 88.45%
165
2020 Annual Report of Songcheng Performance Development Co., Ltd
4. Prepayments
(1) Aging analysis of prepayments is as follows
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Aging
Amount Percentage Amount Percentage
Within 1 year 19,868,443.81 90.58% 16,154,582.37 93.80%
1 to 2 years 1,749,615.05 7.98% 1,067,021.17 6.20%
2 to 3 years 316,167.68 1.44%
Total 21,934,226.54 -- 17,221,603.54 --
(2) Advance payment of the top five closing balances by prepayment parties
Prepayment parties Balance at the End of the Proportion to the total balance of prepayment at
Period the end of the period (%)
Hangzhou World Leisure Expo Park Co., Ltd 2,997,262.50 13.66
Tianjin Kuxun Interactive Technology Co., 2,000,000.00 9.12
Ltd.
Hangzhou Bus Media Group Co., Ltd. 1,966,797.79 8.97
China Music Copyright Association 1,623,809.52 7.40
Guangxi Sutie Culture Media Co., Ltd. 867,924.54 3.96
Total 9,455,794.35 43.11
5. Other receivables
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Interest Receivable
Dividends Receivable
Other Receivables 50,524,990.69 125,573,266.78
Total 50,524,990.69 125,573,266.78
(1) Other Receivables
1) Other receivables categorized by the nature of the funds
Unit: RMB
166
2020 Annual Report of Songcheng Performance Development Co., Ltd
Nature of the funds Closing balance Opening balance
Employee loan 2,772,031.55 1,907,266.72
Security deposit, deposit 14,126,496.40 17,670,537.00
Incomings and outgoings 9,306,779.16 43,496,759.94
Equity transfer fund 79,866,980.26 79,866,980.26
Pending compensation for tourists 25,134.24 485,838.76
Others 2,153,015.26 2,494,950.95
Estimated input VAT 7,551,113.16 12,302,526.06
Total 115,801,550.03 158,224,859.69
Estimated input VAT: When the assets of the scenic spot are put into use, the company shall carry forward the fixed assets af ter
deducting the estimated input VAT based on the estimated total project cos. After the project is completed and invoiced, the fixed
assets shall be transferred to taxable input VAT.
2) Bad debt provision
Unit: RMB
Phase One Phase Two Phase Three
Expected credit losses for
Expected credit Expected credit losses for
Bad debt provision the entire extension Total
losses in the next 12 the entire extension (with
(without credit
months credit impairment)
impairment)
Balance on January 1,
2,530,167.06 30,121,425.85 32,651,592.91
2020
Balance of the current
period on January 1, —— —— —— ——
2020
--Transfer to phase three -326,304.12 326,304.12
Provisions of this period -1,846,125.80 34,397,309.49 32,551,183.69
Other variations 46,556.94 27,225.80 73,782.74
Balance on December
404,294.08 64,872,265.26 65,276,559.34
31, 2020
Book balance changes with significant changes in loss provision in the current period
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging Book balance
Within 1 year 8,456,388.73
1 to 2 years 11,907,312.54
167
2020 Annual Report of Songcheng Performance Development Co., Ltd
2 to 3 years 2,111,159.10
3 to 4 years 81,587,265.26
4 to 5 years 10,060,000.00
5 years or above 1,679,424.40
Total 115,801,550.03
3) Provision for bad debts accrued, recovered or reversed in this period
Unit: RMB
Balance at Amount of Changes in the Current Period
Balance at the End of
Category the Start of Recovered or
Accrued Written Off Others the Period
the Period Reversed
Provision for bad
32,651,592.9
debts of other 32,551,183.69 73,782.74 65,276,559.34
1
receivables
32,651,592.9
Total 32,551,183.69 73,782.74 65,276,559.34
1
4) Accounts receivable actually written off in this period
There are no actual written-off accounts receivable in this period.
5) Other receivables of the top five closing balances collected by debtors
Unit: RMB
As a percentage of
Bad debt provision
Balance at the End total other
Name of Unit Nature of the funds Aging at the end of the
of the Period receivables at the
period
end of the period
An Xiaofen
(formerly: Horgos
Dasheng Legend Equity transfer fund 79,866,980.26 3-4 years 68.97% 61,242,660.26
Venture Capital Co.,
Ltd.)
Shanghai World
Expo Dongdi Cultural Project development
10,000,000.00 4-5 years 8.64% 200,000.00
Development Co., deposit
Ltd.
Ningxiang Cultural Project management 6,241,000.00 1 to 2 years 5.39% 1,515,250.00
168
2020 Annual Report of Songcheng Performance Development Co., Ltd
Tourism Investment fee, incentive fee
Co., Ltd.
New rural
cooperative medical
Deposits 1,260,206.00 3-4 years 1.09% 630,103.00
insurance and other
funds
Beijing Muma
Constellation Culture
Loan 1,050,000.00 5 years or above 0.91% 1,050,000.00
Communication Co.,
Ltd.
Total -- 98,418,186.26 -- 85.00% 64,638,013.26
6. Inventory
Does the company need to comply with the disclosure requirements of the real estate industry
No
(1) Categories of inventories
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Inventory Inventory
depreciation depreciation
provision or provision or
Item
Book balance contract Book value Book balance contract Book value
performance cost performance cost
impairment impairment
provision provision
Finished goods 11,685,709.47 11,685,709.47 4,306,091.80 4,306,091.80
Materials in stock 1,738,437.03 1,738,437.03 1,804,129.76 1,804,129.76
Total 13,424,146.50 13,424,146.50 6,110,221.56 6,110,221.56
7. Other current assets
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Prepayment of value-added tax and VAT
132,363,780.35 109,478,957.39
input tax that has not yet been deducted
169
2020 Annual Report of Songcheng Performance Development Co., Ltd
Prepayment of corporate income tax 14,275,564.96 15,274,526.56
Prepayment of other additional taxes 2,002,059.16 2,817,492.01
Total 148,641,404.47 127,570,975.96
8. Long-term equity investment
Unit: RMB
Decrease/Increase in the current period
Investme Cash
nt profit divide Closing
Balance at Adjustmen Balance at
The Investm Investm and loss nds or balance of
the Start of t on other Other Provision for the End of
invested ents ent recognize profit Oth provision for
the Period comprehe changes in impairment the Period
entity increase decreas d under declar ers decline in
(book value) nsive equity accrued (book value)
d ed the ed to value
income
equity distrib
method ute
Ⅰ. Joint ventures
Ⅱ. Affiliates
Beijing
Beite
Shengdi
Technolo 42,143,812. -531,556. 41,612,255.
gy 03 58 45
Develop
ment Co.,
Ltd.
Beijing
Huafang
Technolo
gy Co.,
Ltd.
(formerly
3,426,452,3 -6,181,99 1,356,586. -67,402,28 -1,861,297,2 1,492,927,3 1,861,297,2
known as
53.05 8.23 59 6.85 84.90 69.66 84.90
Beijing
Six
Rooms
Technolo
gy Co.,
Ltd.)
3,468,596,1 -6,713,55 1,356,586. -67,402,28 -1,861,297,2 1,534,539,6 1,861,297,2
Subtotal
65.08 4.81 59 6.85 84.90 25.11 84.90
170
2020 Annual Report of Songcheng Performance Development Co., Ltd
3,468,596,1 -6,713,55 1,356,586. -67,402,28 -1,861,297,2 1,534,539,6 1,861,297,2
Total
65.08 4.81 59 6.85 84.90 25.11 84.90
Other notes:
(1) Other equity changes in the current period:
In November 2020, Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) increased
its registered capital from RMB 50 million to RMB 53,333,300, and the investment of the company in Beijing Huafang Technology
Co., Ltd. was passively diluted from 39.53% to 37.06%. Using equity method for accounting, the company recognizes the long-term
equity corresponding to the increase in net assets of Beijing Huafang Technology Co., Ltd. due to its capital increase and sh are
expansion. In addition, the decrease in the shareholding ratio should be carried forward according to the new shareholding ratio.
The difference of RMB -97,391,766.67 between the book value of the corresponding long-term equity investment was recognized in
capital reserve. In the current period, the book value of long-term equity investment was adjusted to RMB 29,989,479.82 due to
changes in owner‘s equity other than net profit and loss of the invested unit Beijing Huafang Technology Co., Ltd.
(2) Provision for impairment
The equity of the company was passively diluted on November 10, 2020. According to the requirements of the "Guidelines for
the Application of Regulatory Rules-Accounting No. 1" issued by CSRC on November 13, 2020, the company adopts the equity
method to calculate long-term equity investments. If the investor suffers losses due to passive dilution of equity, the loss caused
thereby shall be regarded as one of the signs of impairment of equity investments. Impairment test on the equity investment
should be conducted. If impairment occurs, the impairment loss of the equity investment shall be recognized first, and then the
impact of equity dilution shall be calculated. The accounting treatment of the company adopted the "Guidelines for the Application
of Regulatory Rules-Accounting No. 1", and China United Assets Appraisal Group Co., Ltd. was hired for the impairment test of
long-term equity investments with the company‘s base date of December 31, 2020. In addition, the long-term equity investment of
the company with a base date of November 30, 2020 (date of equity dilution statement) was assessed for impairment testing.
According to the evaluation results of "The Asset Appraisal Report on Recoverable Amount Asset Appraisal Project of Beijing
Huafang Technology Co.,Ltd Involved in the Impairment Test of the Long-term Equity Investment That Songcheng Performance
Development Co., Ltd Held" (No. 1076 of Year 2021), issued by China United Assets Appraisal Group Co., Ltd. hired by the comp any,
as of November 30, 2020, the value of all shareholders’ equity of Beijing Huafang Technology Co., Ltd. was RMB 3,993,000,000.00.
The recoverable amount RMB 1,578,432,900.00 of long-term equity investment was calculated according to the investment ratio
which was lower than the book value of long-term equity investment of RMB 3,439,730,184.90. The difference of RMB
1,861,297,284.90 was recognized as provision for impairment.
According to the evaluation results of the long-term equity investment impairment test conducted by China United Assets
Appraisal Group Co., Ltd. as of December 31, 2020 (Zhonglian Pingbao Zi No 1075 of Year 2021) , the recoverable amount of
long-term equity investment of the company was not lower than the book value after the impairment of long-term equity
investment.
9. Investment in other equity instruments
Unit: RMB
（1）Investment in other equity instruments
Item Balance at the End of the Period Balance at the Start of the Period
Ningno Songcheng Performance Live
Entertainment Investment Partnership 133,565,454.00 174,529,872.00
(limited partnership)
171
2020 Annual Report of Songcheng Performance Development Co., Ltd
Ningno Songcheng Internet Entertainment
Investment Partnership (limited 78,389,515.54 116,236,828.52
partnership)
Ningno Meishan Bonded Port Area Qixian
Innovation Entertainment Investment 2,093,286.88 3,264,260.36
Partnership (limited partnership)
Ningbo Songcheng Qixian Investment
926,910.00 634,482.00
Management Co., Ltd.
SABH's Big Adventure Inc. 9,291,430.32 6,294,488.76
Total 224,266,596.74 300,959,931.64
(2) Investment in non-trading equity instruments
Unit: RMB
Reason for
The amount of designation as
Reason for
other being measured
transferring other
Recognized comprehensive at fair value and
Item Name Cumulative gain Accumulated loss comprehensive
dividend income income the change
income to
transferred to included in other
retained earning
retained earnings comprehensive
income
Ningno
Songcheng
Performance Live
Long-term
Entertainment
47,542,261.31 holding of
Investment
company strategy
Partnership
(limited
partnership)
Ningno
Songcheng
Internet
Long-term
Entertainment
32,156,015.54 holding of
Investment
company strategy
Partnership
(limited
partnership)
Ningno Meishan
Bonded Port Area Long-term
Qixian Innovation 26,406,713.12 holding of
Entertainment company strategy
Investment
172
2020 Annual Report of Songcheng Performance Development Co., Ltd
Partnership
(limited
partnership)
Ningbo
Songcheng Qixian Long-term
Investment 544,937.31 holding of
Management Co., company strategy
Ltd.
Long-term
SABH's Big
17,342,677.79 holding of
Adventure Inc.
company strategy
Total 32,700,952.85 91,291,652.22
10. Fixed assets
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Fixed Assets 2,508,754,929.16 2,311,251,277.89
Disposal of fixed assets
Total 2,508,754,929.16 2,311,251,277.89
(1) Fixed assets
Unit: RMB
Housing and General Machinery and Transportation Other
Item Total
building Equipment equipment Equipment equipment
Ⅰ. Original book
value:
1. Opening Balance 2,311,133,332.21 325,981,009.36 711,868,099.91 46,950,282.21 3,234,328.33 3,399,167,052.02
2. Increased in the
208,761,081.85 87,323,579.28 128,756,392.89 1,725,720.65 426,566,774.67
Current Period
(1) Purchase 19,386,449.99 2,543,105.07 997,520.65 22,927,075.71
(2) Transferred
From Construction in 207,501,117.27 67,617,877.79 126,213,287.82 401,332,282.88
Progress
(3) Acquisition 1,259,964.58 319,251.50 728,200.00 2,307,416.08
3. Decreased in the
26,951,538.22 40,832,882.46 64,952,599.03 582,655.00 500,000.00 133,819,674.71
Current Period
(1) Disposal or 26,951,538.22 40,832,882.46 64,952,599.03 582,655.00 500,000.00 133,819,674.71
173
2020 Annual Report of Songcheng Performance Development Co., Ltd
Scrapping
4. Closing Balance 2,492,942,875.84 372,471,706.18 775,671,893.77 48,093,347.86 2,734,328.33 3,691,914,151.98
II. Accumulated
depreciation
1. Opening Balance 474,761,446.20 238,854,625.01 349,875,329.35 21,445,860.93 2,978,512.64 1,087,915,774.13
2. Increased in the
89,189,946.98 43,364,023.06 62,073,220.49 7,991,554.84 53,329.05 202,672,074.42
Current Period
(1) Accrual 88,809,054.84 43,063,286.46 62,073,220.49 7,386,359.83 53,329.05 201,385,250.67
(2) Acquisition 380,892.14 300,736.60 605,195.01 1,286,823.75
3. Decreased in the
13,048,524.57 35,439,992.88 57,958,126.46 496,981.82 485,000.00 107,428,625.73
Current Period
(1) Disposal or
13,048,524.57 35,439,992.88 57,958,126.46 496,981.82 485,000.00 107,428,625.73
Scrapping
4. Closing Balance 550,902,868.61 246,778,655.19 353,990,423.38 28,940,433.95 2,546,841.69 1,183,159,222.82
Ⅲ. Provision for
Impairment
1. Opening Balance
2. Increased in the
Current Period
(1) Accrual
3. Decreased in the
Current Period
(1) Disposal or
Scrapping
4. Closing Balance
IV. Book value
1. Closing Balance
1,942,040,007.23 125,693,050.99 421,681,470.39 19,152,913.91 187,486.64 2,508,754,929.16
on Book Value
2. Opening Balance
1,836,371,886.01 87,126,384.35 361,992,770.56 25,504,421.28 255,815.69 2,311,251,277.89
on Book Value
11. Construction in progress
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Projects under Construction 771,871,563.73 370,000,233.10
174
2020 Annual Report of Songcheng Performance Development Co., Ltd
Construction material
Total 771,871,563.73 370,000,233.10
(1) Details of construction in progress
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Item Provision for Provision for
Book balance Book value Book balance Book value
decline in value decline in value
Songcheng Scenic
Area No. 3 and
No. 4 Theater 58,199,776.60 58,199,776.60
Renovation
Project
Songcheng Scenic
Area Renovation 31,455,175.30 31,455,175.30
Project
Crazy Apple Land
Renovation 1,131,346.00 1,131,346.00
Project
Hangzhou
Paradise 21,377,209.00 21,377,209.00
Cableway Project
Hangzhou
Paradise
Upgrading and 1,338,840.00 1,338,840.00
Renovation
Project
Sanya Romance
67,799,438.26 67,799,438.26 68,079,547.97 68,079,547.97
Project
Lijiang Chama
Ancient City
84,480.00 84,480.00
Renovation
Project
Jiuzhai Romance
Renovation 7,464,874.00 7,464,874.00
Project
Longquan
Mountain 350,943.40 350,943.40 350,943.40 350,943.40
Tourism
175
2020 Annual Report of Songcheng Performance Development Co., Ltd
Development
Project
Australian Legend
8,051,137.07 8,051,137.07 7,378,436.19 7,378,436.19
Project
Shanghai World
Expo Grand 294,784,853.21 294,784,853.21 102,352,040.40 102,352,040.40
Theater Project
Guilin Lijiang
Romance
Renovation
Project
Zhangjiajie
Romance
57,752,884.45 57,752,884.45 6,525,333.52 6,525,333.52
Renovation
Project
Xi'an Romance
44,575,845.40 44,575,845.40 46,062,519.11 46,062,519.11
Project
Xitang
Performance 101,251,838.34 101,251,838.34 32,110,163.81 32,110,163.81
Valley Project
South Sea Qiao
Mountain 100,613,590.87 100,613,590.87 17,544,723.10 17,544,723.10
Romance Project
Zhuhai
Performance 65,235,857.43 65,235,857.43
Kingdom Project
Total 771,871,563.73 771,871,563.73 370,000,233.10 370,000,233.10
(2) Changes in significant construction in progress
Unit: RMB
Includin
Project
g: Capitaliza
Other accumula
Balance Balance Accumula capitali tion rate
Increased Transfer amounts tive Projec Capit
at the at the ted zed of the
Item in the amounts decrease investme t al
Budget Start of End of capitalize interest interest in
Name current in this d in nt as a Progr Sour
the the d interest amount the
period period current percentag ess ce
Period Period amount in the current
period e of the
current period
budget
period
176
2020 Annual Report of Songcheng Performance Development Co., Ltd
Songchen
g Scenic
Area No. 100.00
58,199,776 112,842,92 170,294,74 Othe
3 and No. 160,790,000.00 747,961.00 106.38%
.60 7.40 3.00
% rs
4 Theater
Renovatio
n Project
Songchen
g Scenic
125,023,72 60,896,475 32,672,076 31,455,175 Othe
Area 188,344,300.00 66.38% 80.00%
7.11 .20 .61 .30 rs
Renovatio
n Project
Crazy
Apple
1,131,346. 1,293,492. 1,947,928. 100.00 Othe
Land 3,000,000.00 476,910.00 80.83%
00 00 00 % rs
Renovatio
n Project
Hangzhou
Paradise 21,377,209 21,955,869 100.00 Othe
22,185,540.00 578,660.00 98.96%
Cableway .00 .00 % rs
Project
Hangzhou
Paradise
Upgradin 1,338,840. 18,392,930 14,372,889 5,358,880. 100.00 Othe
28,383,000.00 69.52%
g and 00 .05 .70 35 % rs
Renovatio
n Project
Sanya
68,079,547 14,174,485 12,261,137 2,193,458. 67,799,438 Othe
Romance 90,000,000.00 91.39% 95.00%
.97 .29 .00 00 .26 rs
Project
Lijiang
Chama
Ancient 11,163,785 4,900,996. 6,347,268. 100.00 Othe
12,226,191.93 84,480.00 92.00%
City .09 69 40 % rs
Renovatio
n Project
Jiuzhai
Romance 7,464,874. 24,956,883 29,641,013 2,780,744. 100.00 Othe
48,510,000.00 66.84%
Renovatio 00 .82 .40 42 % rs
n Project
Longquan Othe
212,588,000.00 350,943.40 9,836.28 9,836.28 350,943.40 69.80% 90.00%
Mountain rs
177
2020 Annual Report of Songcheng Performance Development Co., Ltd
Tourism
Developm
ent
Project
Australian
1,692,380,000. 7,378,436. 8,051,137. Othe
Legend 672,700.88 0.48% 2.00%
00 19 07 rs
Project
Shanghai
World
Expo 102,352,04 192,432,81 294,784,85 Othe
830,260,000.00 35.51% 90.00%
Grand 0.40 2.81 3.21 rs
Theater
Project
Guilin
Lijiang
14,742,695 13,026,913 1,715,781. 100.00 Othe
Romance 15,477,872.07 95.25%
.86 .87 99 % rs
Renovatio
n Project
Zhangjiaji
e
6,525,333. 49,249,285 -2,516,897. 57,752,884 Othe
Romance 123,920,000.00 538,632.31 45.01% 95.00%
52 .71 53 .45 rs
Renovatio
n Project
Xi'an
46,062,519 183,273,74 74,541,378 110,219,03 44,575,845 Othe
Romance 480,000,000.00 47.78% 60.00%
.11 4.37 .27 9.81 .40 rs
Project
Xitang
Performa 32,110,163 69,141,674 101,251,83 Othe
400,000,000.00 25.31% 40.00%
nce Valley .81 .53 8.34 rs
Project
South Sea
Qiao
17,544,723 83,068,867 100,613,59 Othe
Mountain 700,000,000.00 14.37% 50.00%
.10 .77 0.87 rs
Romance
Project
Zhuhai
Performa
2,500,000,000. 65,235,857 65,235,857 Othe
nce 2.61% 2.00%
00 .43 .43 rs
Kingdom
Project
Total 7,508,064,90 370,000,23 966,254,36 401,332,28 163,050,75 771,871,56 --
178
2020 Annual Report of Songcheng Performance Development Co., Ltd
4.00 3.10 6.40 2.88 2.89 3.73
Details of changes in the projects under construction: Other reductions of RMB 163,050,752.89 in the current period are the
transfer of long-term deferred expenses amounting to RMB 125,574,936.70 and the transfer of operating costs of maintenance and
improvement amounting to RMB 37,475,816.19.
For Zhangjiajie Romance Project, the amount of fixed assets transferred into the current period was RMB-2,516,897.53. The
original value of fixed assets shall be adjusted correspondingly to the difference in the final accounts of the previous proj ects
completed in this period.
12. Intangible assets
(1) Details of intangible assets
Unit: RMB
Non-patented Computer Intellectual Vehicle license
Item Land use rights Patent right Total
technology Software Property plate
Ⅰ. Original
book value
1.
1,649,920,722. 1,690,995,372.
Opening 40,323,649.98 600,000.00 151,000.00
90 88
Balance
2.
Increased in
436,767,296.90 2,339,383.71 99,800.00 439,206,480.61
the Current
Period
(1)
7,743,540.89 2,339,383.71 99,800.00 10,182,724.60
Purchase
(2)
Internal
research and
development
(3)
429,023,756.01 429,023,756.01
Acquisition
3. Decreased
in the Current
Period
(1)
Disposal
179
2020 Annual Report of Songcheng Performance Development Co., Ltd
4. Closing 2,086,688,019. 2,130,201,853.
42,663,033.69 600,000.00 250,800.00
Balance 80 49
Ⅱ.
Accumulated
amortization
1.
Opening 181,383,655.06 10,860,063.11 220,000.00 41,524.89 192,505,243.06
Balance
2.
Increased in
51,157,924.94 6,425,009.61 60,000.00 21,753.32 57,664,687.87
the Current
Period
(1)
50,163,049.74 6,425,009.61 60,000.00 21,753.32 56,669,812.67
Accrual
(2)
994,875.20 994,875.20
Acquisition
3.
Decreased in
the Current
Period
(1)
Disposal
4. Closing
232,541,580.00 17,285,072.72 280,000.00 63,278.21 250,169,930.93
Balance
Ⅲ. Provision
for Impairment
1.
Opening
Balance
2.
Increased in
the Current
Period
(1)
Accrual
3.
Decreased in
the Current
180
2020 Annual Report of Songcheng Performance Development Co., Ltd
Period
(1)
Disposal
4. Closing
Balance
Ⅳ. Book value
1. Closing
1,854,146,439. 1,880,031,922.
Balance on 25,377,960.97 320,000.00 187,521.79
80 56
Book Value
2.
Opening 1,468,537,067. 1,498,490,129.
29,463,586.87 380,000.00 109,475.11
Balance on 84 82
Book Value
13. Goodwill
(1) Original book value of goodwill
Unit: RMB
The invested Increased in the current period Decreased in the current period
Balance at the
entity or matters Generated from Balance at the
Start of the
which formed business Disposal End of the Period
Period
goodwill combination
Jiuzhaigou
Tibetan Mystery 45,504,625.96 45,504,625.96
Culture Co., Ltd
Total 45,504,625.96 45,504,625.96
(2) Provision of impairment in goodwill
Unit: RMB
The invested Increased in the current period Decreased in the current period
Balance at the
entity or matters Balance at the
Start of the
which formed Accrued Disposal End of the Period
Period
goodwill
Jiuzhaigou
Tibetan Mystery 17,425,960.27 16,422,870.82 33,848,831.09
Culture Co., Ltd
181
2020 Annual Report of Songcheng Performance Development Co., Ltd
Total 17,425,960.27 16,422,870.82 33,848,831.09
Information about the asset group or asset group combination where the goodwill is located
Jiuzhaigou Tibetan Mystery Culture Co., Ltd:
Composition of asset group or combination of asset Jiuzhaigou Tibetan Mystery Culture Co., Ltd
groups
Book value of the asset group or asset groups 46,117,875.21
combination
Original book value of goodwill 45,504,625.96
Unrecognized value of goodwill attributed to equity of 30,336,417.31
minority shareholders
Including the value of unrecognized goodwill attributed 75,841,043.27
to minority shareholders' equity
The book value of the asset group or combination of 121,958,918.48
asset groups that involves goodwill
The present book value of the expected future cash flow 65,544,200.00
of the asset group (the recoverable current book value)
Accumulated impairment loss of goodwill 33,848,831.09
Whether the asset group or combination of asset groups Consistency
is consistent with its identified amount at the date of
purchase and the goodwill impairment test of previous
years
In 2015, the company acquired 60% of Jiuzhaigou Tibetan Mystery Culture Co., Ltd.,. whose business is single and independent
for accounting; therefore it is considered as an independent asset group.
(3) The process, method, key parameters of the goodwill impairment test and the method of confirming the
loss of goodwill impairment:：
The recoverable amount of the asset group is determined on the basis of the higher of the present value of the estimated
future operating net cash flow during the asset life or the market value (fair value) of the asset, minus the net amount of d isposal
expenses and relevant taxes.
The present value of the expected future net cash flow of the asset group is based on the management budget for the next five
years and the adjusted discount rate. It is calculated by using the cash flow forecasting method. The cash flow beyond the five-year
detailed forecast period is calculated with a stable growth rate. Among them, the forecast period of cash flow is 2021-2025 (the
subsequent period is perpetuity), and the discount rate is 12.79%.
Other key data used in the impairment test include: operating revenue, operating costs and related expenses, capital expenditures,
depreciation and amortization.
According to the "Asset Appraisal Report"(No.01-268,Beifangyapingbaozi of Year 2021) issued by Beijing Northern Asia Assets
Appraisal Firm (Special General Partnership) hired by the company, recoverable amount of the asset group involving goodwill was
RMB 65,544,200.00. After testing, the accumulated goodwill impairment of Jiuzhaigou Tibetan Mystery Culture Co., Ltd. was RMB
33,848,831.09.
14. Long-term prepaid expenses
Unit: RMB
182
2020 Annual Report of Songcheng Performance Development Co., Ltd
Balance at the Start Increased in the Prepaid Expenses in Other Amounts Balance at the End
Item
of the Period current period This Period Decreased of the Period
Expenditures for
improvement of
16,194,513.36 102,555,642.98 5,014,426.73 113,735,729.61
operating leased
fixed assets
House decoration
3,156,210.74 4,331,967.84 2,363,188.65 5,124,989.93
fee
Fees for road signs in
14,034,104.10 5,540,200.98 5,395,796.05 14,178,509.03
scenic spots
Scenic animals and
43,755,769.03 8,490,010.36 14,725,262.80 37,520,516.59
plants
Cost of creating
34,820,479.01 15,026,982.17 5,754,104.36 44,093,356.82
costumes and props
Long-term rental fee 479,550.78 109,202,325.81 1,035,087.58 108,646,789.01
Others 1,187,442.62 746,156.72 441,285.90
Total 112,440,627.02 246,334,572.76 35,034,022.89 323,741,176.89
15. Deferred income tax assets/liabilities
(1) Deferred income tax assets not written off
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Item Deductible temporary Deferred Income Tax Deductible temporary Deferred Income Tax
difference Assets difference Assets
Provision for Impairment
65,659,489.58 16,308,221.87 32,861,329.93 8,158,388.51
of Assets
Unrealized Profit from
8,710,326.58 2,177,581.65 3,960,255.51 990,063.88
Internal Transactions
Total 74,369,816.16 18,485,803.52 36,821,585.44 9,148,452.39
(2) Deferred income tax liabilities not written off
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Item Taxable temporary Deferred Income Tax Taxable temporary Deferred Income Tax
difference Liabilities difference Liabilities
Asset appraisal 386,938,479.60 96,734,619.90
183
2020 Annual Report of Songcheng Performance Development Co., Ltd
increment of merged
assets of the entities not
under common control
Changes in the fair value
of other equity 38,442,254.88 9,610,563.72
instrument investments
Changes in the fair value
of the trading financial
assets included in the
182,449.34 34,600.28 4,643,937.75 1,160,984.46
profit and loss from fair
value changes of the
current period
Total 387,120,928.94 96,769,220.18 43,086,192.63 10,771,548.18
(3) Details of unrecognized deferred income tax assets
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Deductible temporary difference 1,044,004,655.08
Deductible Losses 359,520,530.58 178,326,292.21
Total 1,403,525,185.66 178,326,292.21
(4) The deductible losses of unrecognized deferred income tax assets will mature in the following years
Unit: RMB
Amount at the end of the
Year Opening balance Notes
period
2020 445.00
2021 10,214,970.98 10,063,818.26
2022 16,736,431.92 20,511,817.39
2023 62,433,581.93 62,499,359.60
2024 70,358,021.61 85,250,851.96
2025 199,777,524.14
Total 359,520,530.58 178,326,292.21 --
Other notes:
The company acquired Zhuhai Southern Film and Television Culture Industry Co., Ltd. in 2020, which increased the recoverable
loss of the company to RMB 3,194,995.24 by the end of 2021
184
2020 Annual Report of Songcheng Performance Development Co., Ltd
16. Other non-current assets
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Provision for Provision for
Item
Book balance decline in Book value Book balance decline in Book value
value value
21,064,619.2 21,064,619.2
Advance payment for project 7,733,926.26 7,733,926.26
7 7
Advance payment for car 855,900.00 855,900.00
21,064,619.2 21,064,619.2
Total 8,589,826.26 8,589,826.26
7 7
17. Accounts payable
(1) Details of accounts payable
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Payment for project, equipment and
346,638,370.70 282,821,061.27
maintenance
Inventory cost 24,866,101.30 13,964,738.58
Rental fees 1,200,000.00
Advertising cost and other fees 971,992.69 2,671,079.77
Total 372,476,464.69 300,656,879.62
18. Advance receipts
(1) Details of received pre-payments
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Shop rent 12,888,689.05 39,894,552.94
Ticket fees
Planning fee, design fee, program
production fee
Total 12,888,689.05 39,894,552.94
185
2020 Annual Report of Songcheng Performance Development Co., Ltd
19. Contract liabilities
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Ticket fees 11,352,124.25 10,811,921.34
Planning fee, design fee, program
177,198,113.27 283,490,566.04
production fee
Total 188,550,237.52 294,302,487.38
The amount of significant change in book value during the reporting period and the reason thereof
Unit: RMB
Item Amount of change Reason for change
Planning fee, design fee,
73,584,905.66 Increase in amount due to receipt of cash
program production fee
Planning fee, design fee, The amount of reduced contract liabilities due to the carry-over
-179,877,358.43
program production fee income of this year
Total -106,292,452.77 ——
20、Salary payable
(1) Details of payroll payable
Unit: RMB
Balance at the Start of Increased in the current Decreased in the current Balance at the End of the
Item
the Period period period Period
Ⅰ. Short-term
26,636,404.96 165,085,458.36 172,980,522.37 18,741,340.95
remuneration
Ⅱ. Dismission benefits -
defined contribution 101,483.47 2,429,865.27 2,454,884.95 76,463.79
scheme
Ⅲ. Dismissal welfare 269,784.48 269,784.48
Total 26,737,888.43 167,785,108.11 175,705,191.80 18,817,804.74
(2) List of short-term remuneration
Unit: RMB
Balance at the Start of Increased in the current Decreased in the current Balance at the End of the
Item
the Period period period Period
1. Wages or salaries,
22,890,436.83 141,141,123.17 149,644,935.62 14,386,624.38
bonuses, allowances and
186
2020 Annual Report of Songcheng Performance Development Co., Ltd
subsidies
2. Staff welfare 14,001,512.92 13,985,822.68 15,690.24
3. Social insurance
76,842.60 5,179,287.92 5,181,381.13 74,749.39
contributions
Including: medical
66,814.36 4,997,487.95 5,004,083.36 60,218.95
insurance
Work injury
1,727.23 45,433.97 45,456.48 1,704.72
insurance premium
Birth
8,301.01 136,366.00 131,841.29 12,825.72
insurance premium
4. Housing funds 38,191.00 3,405,206.80 3,369,015.80 74,382.00
5. Labor union and
3,630,934.53 1,358,327.55 799,367.14 4,189,894.94
education funds
Total 26,636,404.96 165,085,458.36 172,980,522.37 18,741,340.95
(3) Defined contribution scheme (Note)
Unit: RMB
Balance at the Start of Increased in the current Decreased in the current Balance at the End of the
Item
the Period period period Period
1. Basic pension
98,301.95 2,349,165.30 2,374,077.04 73,390.21
insurance
2. Unemployment
3,181.52 80,699.97 80,807.91 3,073.58
insurance
Total 101,483.47 2,429,865.27 2,454,884.95 76,463.79
21. Taxes payable
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
VAT 1,627,758.21 1,369,684.24
Enterprise Income Tax 14,538,779.22 11,790,054.25
Individual income tax 568,739.64 419,317.22
Urban Maintenance and Construction Tax 124,619.04 162,742.03
House property tax 2,125,001.78 6,177,522.75
Land usage tax 790,142.85 2,482,574.75
Education Surcharges 69,757.11 117,648.61
Stamp duty 25,010.64 94,292.11
187
2020 Annual Report of Songcheng Performance Development Co., Ltd
Others 335.68
Total 19,869,808.49 22,614,171.64
22. Other payables
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Interest Payable
Dividends Payable
Other Payables 65,149,971.79 63,299,348.02
Total 65,149,971.79 63,299,348.02
(1) Other payables
1) Other payables listed by nature of funds
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Merchant deposit 4,724,228.60 13,413,112.55
Deposit of construction party 4,130,003.70 4,708,367.70
Deposit of merchant for bidding 1,923,628.40 2,518,060.00
Deposit of travel agency 4,301,753.00 3,640,858.00
Other types of deposits 1,553,964.82 1,663,064.43
Reward for over-fulfilled performance 31,576,200.00 31,576,200.00
Incomings and outgoings 14,094,504.75 3,427,348.61
Others 2,845,688.52 2,352,336.73
Total 65,149,971.79 63,299,348.02
Other explanation: The reward for over-fulfilled performance at the end of the period is determined according to the initial
acquisition agreement with Beijing Huafang Technology Co., Ltd.,. If the excess part of the net profit actually realized duri ng the
performance commitment period that is higher than the promised net profit, the excess part has not been issued to the
management shall be calculated in accordance with the agreed proportion
23. Non-current liabilities due within one year
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
188
2020 Annual Report of Songcheng Performance Development Co., Ltd
Long-term debt due within one year 12,000,000.00
Interest on long-term loans for which the
principal and interest is repaid by 426,708.33
installments
Total 12,426,708.33
24. Other current liabilities
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Output VAT to be carried forward 3,513,902.08 17,536,415.96
Total 3,513,902.08 17,536,415.96
25. Long-term loans
(1) Categories of long-term loans
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Fiduciary loans 282,000,000.00
Total 282,000,000.00
26. Deferred revenue
Unit: RMB
Balance at the Start Increased in the Decreased in the Balance at the End
Item Causes
of the Period current period current period of the Period
Government
382,872,318.90 5,373,300.00 625,758.49 387,619,860.41 Government's grant
subsidies
Total 382,872,318.90 5,373,300.00 625,758.49 387,619,860.41 --
Projects related to government subsidies:
Unit: RMB
The The
Amount
The amount Amount Amount
Balance at the recorded as Balance at the Related to
of new Recorded Written Other
Liabilities Start of the non-operating End of the assets/related
subsidies in as Other off Costs variations
Period revenue in this Period to income
this period Income in in This
period
This Period Period
189
2020 Annual Report of Songcheng Performance Development Co., Ltd
In 2008, the
discounts on
interest for the
Related to
international 3,333,332.38 142,857.24 3,190,475.14
assets
animation gallery
project were
received.
In 2017, the
cultural and
creative funds for Related to
346,666.28 20,000.04 326,666.24
"Love Song of assets
Lijiang" project
were received.
In 2017, the grant
for the toilet
project of the
modern service Related to
114,833.56 6,500.04 108,333.52
industry in assets
Songcheng Scenic
Area were
received.
In 2017, Hangzhou
modern service
industry guiding Related to
537,800.00 13,445.00 524,355.00
funds for the cable assets
car project were
received.
In 2017, the special
funds of tourism
planning and
construction of Related to
903,586.61 52,130.04 851,456.57
modern service for assets
Xianghu Lake
Romance were
received.
In 2017, the special
funds for cultural
Related to
industry 2,000,000.00 58,333.31 1,941,666.69
assets
development were
received.
In 2018, the special Related to
500,000.00 500,000.00
funds for cultural assets
190
2020 Annual Report of Songcheng Performance Development Co., Ltd
industry
development were
received from the
Department of
Culture, Radio,
Television, Press,
Publication and
Sports of Hainan
province.
In 2018, the
subsidies for
Longquan
Mountain Related to
922,833.36 48,999.96 873,833.40
ecological assets
rehabilitation
project were
received.
In 2018, the
subsidies for Guilin
Lijiang Romance
fork culture, leisure Related to
462,500.04 24,999.96 437,500.08
tourism and income
performance
project were
received.
In 2019, the special
funds for planning
and construction
subsidies of
modern service
industry issued by
the Municipal
Related to
Tourism 1,626,433.34 66,159.96 1,560,273.38
assets
Commission for the
reconstruction
project of No. 2
Theater Complex in
Songcheng
Romance Park
were received.
In 2019, Hangzhou
Related to
modern service 199,333.33 8,000.03 191,333.30
income
industry tourism
191
2020 Annual Report of Songcheng Performance Development Co., Ltd
special funds for
the construction
project of the new
entrance hall
washroom were
received.
In 2019, the
guiding funds of
Guilin Lijiang
service industry for
Guilin Romance Related to
1,425,000.00 75,000.00 1,350,000.00
folk culture leisure assets
tourism
performance
project were
received.
In 2019, special
funds issued by
Xiqiao Mountain
Scenic Area
Management
Committee in
Related to
Nanhai District, 370,000,000.00 370,000,000.00
assets
Foshan for
supporting the
project of Foshan
Xiqiao Mountain
Romance park
were received.
In 2019, the
cultural and
tourism industry
funds issued by
Hainan Provincial Related to
500,000.00 500,000.00
Department of assets
Finance for Sanya
No. 2 theater
project were
received.
In 2020, the
financial support Related to
280,000.00 280,000.00
funds issued by assets
Shanghai
192
2020 Annual Report of Songcheng Performance Development Co., Ltd
government for
promoting the
development of
cultural and
creative industries
were received.
In 2020, the
cultural industry
development
special funds
issued by Hainan
Related to
Provincial 2,000,000.00 2,000,000.00
income
Department of
Finance for Sanya
No.2 Theater
Project were
received.
In 2020, the special
funds for
development of
modern service
industry issued by
Related to
Development and 2,000,000.00 83,330.00 1,916,670.00
assets
Reform Bureau of
Wulingyuan
District of
Zhangjiajie were
received.
In 2020, the special
funds for tourism
development
issued by Related to
423,400.00 21,170.00 402,230.00
Zhangjiajie assets
Municipal Finance
Bureau were
received.
In 2020, Hangzhou
modern service
industry tourism
Related to
special funds 490,000.00 4,083.33 485,916.67
income
allocated by
Hangzhou Culture,
Radio, Film and
193
2020 Annual Report of Songcheng Performance Development Co., Ltd
Television Tourism
Bureau for
significant leisure
tourism
construction, the
upgrading and
renovation of
scenic spots, and
tourism planning
projects were
received.
In 2020, the special
tourism (tourism
toilet) subsidies
allocated by
Related to
Hangzhou Culture, 179,900.00 749.58 179,150.42
assets
Radio, Film and
Television Tourism
Bureau were
received.
Total 382,872,318.90 5,373,300.00 625,758.49 387,619,860.41
27. Share capital
Unit: RMB
Increased or decreased amount in this period (+/-)
Balance at the Balance at the
Shares
Start of the Shares newly End of the
Bonus shares converted from Others Subtotal
Period issued Period
capital reserves
1,452,607,800. 1,162,086,240. 1,162,086,240. 2,614,694,040.
Total shares
00 00 00 00
Other notes:
(1) Transfer of capital reserves: The equity distribution plan was reviewed and approved at the Annual General Meeting of
Shareholders of Year 2019 held on 18 May,2020. Based on the total capital of 1,452,607,800 shares at the end of 2019, the
company transferred 8 additional shares for every 10 shares from the capital reserve to all shareholders. Total of 1,162,086,240
additional shares were added. The total share capital after transfer was 2,614,694,040 shares.
(2) Other changes: the conversion between restricted shares and unrestricted shares. Among them, according to the
"Implementation Rules for Shareholders, Directors, Supervisors, Top Management Personnel of Listed Companies of Shenzhen
Stock Exchange", in 2020, the restricted shares held by the secretary of board Dong Xin and former director Liu Yan was lifted and
38,830,789 shares of restricted shares were converted. Liu Ping added 459,827 restricted shares due to changes in security
account.
194
2020 Annual Report of Songcheng Performance Development Co., Ltd
28. Capital reserves
Unit: RMB
Balance at the Start of Increased in the current Decreased in the current Balance at the End of the
Item
the Period period period Period
Capital premium (capital
2,467,285,269.09 1,197,545,567.38 1,269,739,701.71
share premium)
Other capital reserves 9,026,800.00 29,989,479.82 97,391,766.67 -58,375,486.85
Among them: (1)
Amount of share-based
8,676,800.00 8,676,800.00
payment included in
owner’s equity
(2) Other 350,000.00 350,000.00
(3) Other changes in
owner‘s equity other
29,989,479.82 97,391,766.67 -67,402,286.85
than net profit and loss
of the invested entity
Total 2,476,312,069.09 29,989,479.82 1,294,937,334.05 1,211,364,214.86
Other notes, including increases or decreases in this period and their reasons:
(1) Description of changes in capital premium (share premium):
1).The annual equity distribution plan was reviewed and approved in Annual General Meeting of Shareholders of Year 2019
held on 18 May, 2020. based on the total capital of 1,452,607,800 shares at the end of Year 2019, the company transferred 8
additional shares for every 10 shares from the capital reserve to all shareholders. Total reduction of capital reserve-capital premium
was RMB 1,162,086,240 .
The company acquired 20% minority shareholders' interests of its subsidiary Aba Zhou Jiuzhai Romance Tourism Development
Co., Ltd.,. The shareholding ratio rose from 80% to 100%. The difference between the newly acquired long -term equity investment
as a result of purchase of minority equity and the net assets based on new shareholding ratio that shoul d be continuously
calculated by the subsidiary since the purchase date was RMB -35,459,327.38. The capital reserve-capital premium was reduced by
RMB 35,459,327.38.
(2) Other changes in owner‘s equity other than net profit and loss of the invested entity
1). In November 2020, Beijing Huafang Technology co., ltd. (formerly known as Beijing Six Rooms Technology co., ltd.)
increased its registered capital from RMB 5,000 ten thousand to RMB 5,333.33 ten thousand , and the investment of the company
in Beijing Huafang Technology co., ltd. was passively diluted from 39.53% to 37.06%. Using equity method for accounting, the
company recognizes the long-term equity corresponding to the increase in net assets of Beijing Huafang Technology co., ltd. due to
its capital increase and share expansion. In addition, the decrease in the shareholding ratio should be carried forward according to
the new shareholding ratio. The difference of RMB -97,391,766.67 between the book value of the corresponding long-term equity
investment was recognized in capital reserve.
In the current period, the book value of long-term equity investment was adjusted to RMB 29,989,479.82 due to the changes
in owner‘s equity other than net profit and loss of the invested unit Beijing Huafang Technology Co., ltd.
195
2020 Annual Report of Songcheng Performance Development Co., Ltd
29. Other comprehensive incomes
Unit: RMB
This Period's Amount of Occurrence
Less:
Recorded
Less:
into other
recorded into
comprehe
other
nsive Attributabl Balance
comprehensi
Balance at incomes in Less: Attributabl e to the at the
Before tax ve incomes
Item the Start of previous Income e to the minority End of
balance in in previous
the Period period and Tax Company sharehold the
this period period and
transferre Expense after tax ers after Period
transferred
d to tax
to P/L in
retained
current
income in
period
current
period
1. Other comprehensive income
17,490,719. -76,693,33 -1,356,586 -9,610,563 -65,726,18 -48,235,
that cannot be reclassified into
49 4.90 .59 .72 4.59 465.10
profit and loss
Other comprehensive
income that cannot be -1,356,586. -1,356,586 1,356,586.
transferred to profit or loss under 59 .59 59
the equity method
Changes in the fair value
18,847,306. -76,693,33 -9,610,563 -67,082,77 -48,235,
of other equity instrument
08 4.90 .72 1.18 465.10
investments
II. Other comprehensive income -26,171,871 11,082,80 11,082,22 -15,089,
586.20
that will be reclassified into P/L .08 6.63 0.43 650.65
Currency conversion -26,171,871 11,082,80 11,082,22 -15,089,
586.20
difference .08 6.63 0.43 650.65
Other comprehensive incomes in -8,681,151. -65,610,52 -1,356,586 -9,610,563 -54,643,96 -63,325,
586.20
total 59 8.27 .59 .72 4.16 115.75
30. Surplus reserve
Unit: RMB
Balance at the Start of Increased in the current Decreased in the current Balance at the End of the
Item
the Period period period Period
Statutory surplus reserve 517,673,268.35 517,673,268.35
196
2020 Annual Report of Songcheng Performance Development Co., Ltd
Total 517,673,268.35 517,673,268.35
31. Undistributed profits
Unit: RMB
Item Current period Previous Period
Undistributed Profit before Adjustment at the End
5,176,157,180.79 4,170,577,596.34
of Previous Period
Adjust the total undistributed profits at the start
3,653,579.35
of the period (increase +, decrease -)
Undistributed Profit after Adjustment at the Start
5,176,157,180.79 4,174,231,175.69
of the Period
Add: net profit attributable to parent company's
-1,752,398,009.60 1,339,790,994.94
owner in current period
Other Carry-forward Retained Earnings of
-1,356,586.59 3,336,493.95
the Comprehensive Income
Less: withdrawal for statutory surplus reserve 166,888,547.79
Payable dividends on ordinary shares 290,521,560.00 174,312,936.00
Undistributed Profit at the End of the Period 3,131,881,024.60 5,176,157,180.79
1). Due to the retrospective adjustment according to the "Accounting Standards for Business Enterprises" and related new
regulations, affected undistributed profit at the beginning of the period was RMB 0.00.
2). Due to changes in accounting policies, affected undistributed profit at the beginning of the period was RMB 0.00.
3). Due to the correction of major accounting errors, affected undistributed profit at the beginning of the period was RMB 0.00.
4) Due to changes in the scope of consolidation under same control, affected undistributed profit at the beginning of the per iod was
RMB 0.00.
5). Due to Other adjustments, affected undistributed profit at the beginning of the period was RMB 0.00.
32. Operating income and operating costs
Unit: RMB
This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Item
Income Cost Income Cost
Main Business 860,109,435.13 350,061,394.54 2,473,465,265.61 744,700,816.40
Other businesses 42,476,690.50 2,609,078.88 138,287,943.25 2,488,484.84
Total 902,586,125.63 352,670,473.42 2,611,753,208.86 747,189,301.24
Whether the lower of the audited net profit before and after deduction of non-recurring gains and losses is negative
√ Yes □ No
Unit: RMB
197
2020 Annual Report of Songcheng Performance Development Co., Ltd
Item 2020 2019 Notes
Operating income 902,586,125.63 / Total Operating Income
Income from personnel
Deduction items of dispatch management and
6,381,032.95 /
operating revenue other miscellaneous
businesses
Including:
Management fee business Revenue from personnel
3,519,339.62 /
revenue dispatch management fee
Other sporadic business
Others 2,861,693.33 /
income
Income from personnel
Subtotal of
dispatch management and
business income not related 6,381,032.95 /
other miscellaneous
to main business
businesses
Subtotal of
0.00 / N/A
non-business revenue
Amount of operating Operating income of main
896,205,092.68 /
revenue after deduction business
Related information of revenue:
Unit: RMB
Culture and art Tourism service
Contract classification Other businesses Total
industry-live performance industry
Product types 636,915,514.47 223,193,920.66 42,476,690.50 902,586,125.63
Including:
(1) Hangzhou Songcheng
265,487,381.20 265,487,381.20
Tourist Area
(2) Sanya Songcheng Tourist
118,683,102.20 118,683,102.20
Area
(3) Lijiang Songcheng
132,544,773.13 132,544,773.13
Tourist Area
(4) Jiuzhai Songcheng
25,197,742.08 25,197,742.08
Tourist Area
(5) Guilin Songcheng Tourist
53,799,653.29 53,799,653.29
Area
(6) Zhangjiajie Songcheng
16,480,189.00 16,480,189.00
Tourist Area
(7) Xi'an Songcheng Tourist 24,722,673.57 24,722,673.57
198
2020 Annual Report of Songcheng Performance Development Co., Ltd
Area
(8) E-business handling fee 43,316,562.23 43,316,562.23
(9) Design planning fee 179,877,358.43 179,877,358.43
(10) Management fee
3,519,339.62 3,519,339.62
business
(11) Leasing business of
36,095,657.55 36,095,657.55
scenic spots
(12) Other 2,861,693.33 2,861,693.33
Contract type 636,915,514.47 223,193,920.66 42,476,690.50 902,586,125.63
Including:
(1) Revenue from contract 636,915,514.47 223,193,920.66 6,381,032.95 866,490,468.08
Classified by the time of 6,381,032.95 866,490,468.08
636,915,514.47 223,193,920.66
commodity transfer
Including:
Confirm at time points 636,357,477.47 43,316,562.23 835,167.32 680,509,207.02
Confirm within a certain
558,037.00 179,877,358.43 5,545,865.63 185,981,261.06
period of time
(2) Rental income 36,095,657.55 36,095,657.55
Information related to performance obligations:
N/A
Information related to the transaction price allocated to the remaining 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 RMB 177,198,113.27 , of which RMB 177,198,113.27 is expected to be
recognized as revenue in 2021-2025.
33. Taxes and surcharges
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Urban Maintenance and Construction Tax 944,001.17 5,780,053.12
Education Surcharges 827,724.98 4,379,199.98
House property tax 7,447,753.53 16,889,492.45
Land usage tax 1,928,223.64 5,159,854.16
Vehicle and vessel use tax 49,250.44 44,089.37
Stamp duty 709,855.81 3,844,271.82
Water conservancy construction fund 26,687.48 67,827.55
Total 11,933,497.05 36,164,788.45
199
2020 Annual Report of Songcheng Performance Development Co., Ltd
34. Sales expenses
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Sales of agent 39,452,375.76
Advertising cost 45,899,163.03 81,882,054.48
Salary and labor fees 9,262,823.51 13,194,734.22
Rental fees 1,546,072.36 3,394,295.48
Fees for technical services 878,308.35 2,088,909.13
Material consumption 2,451,944.75 1,951,887.84
Traveling expense 976,777.55 1,007,577.13
Others 2,634,660.75 2,531,802.60
Total 63,649,750.30 145,503,636.64
35. Management expenses
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Salary and labor fees 75,408,829.46 65,258,783.45
Amortization of intangible assets and
64,348,021.07 41,918,863.26
other assets
Consulting fee 8,182,473.68 8,355,212.52
Traveling expense 5,624,695.71 8,034,072.39
Depreciation charge 75,830,364.58 17,052,355.49
Business entertainment expense 10,034,078.60 9,854,115.36
Rental fees 5,086,107.77 7,710,352.14
Material consumption 9,364,375.32 7,365,101.12
Office expense 5,579,245.84 4,200,718.37
Trademark royalty 9,433,962.00 9,571,349.95
Afforestation fee 2,321,906.68
Maintenance cost 3,541,464.14 2,237,261.26
Others 13,328,642.89 6,656,935.92
Total 288,084,167.74 188,215,121.23
Other notes:
Due to the impact of the "COVID-19" in 2020, the scenic spots of the company were closed from January 24, 2020 to June 11,
200
2020 Annual Report of Songcheng Performance Development Co., Ltd
2020. During the closure period, the amount that should have been recognized in operating costs was included in management
expenses.
36. R&D expenses
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Salary and labor fees 21,062,406.05 31,117,911.36
Fees for technical services 324,329.47 2,273,176.07
Design fee 215,813.33 505,299.96
Rental fees 617,847.90 1,520,774.62
Amortization of intangible assets and
314,907.89 704,290.03
other assets
Traveling expense 589,458.88 2,581,588.90
Office expense 698,738.20 997,614.76
Depreciation charge 7,404,031.20 3,988,986.72
Material consumption 5,295,522.43 2,541,649.23
Others 964,908.65 2,193,228.89
Total 37,487,964.00 48,424,520.54
37. Financial expenses
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Interest expense 7,822,986.14
Less: interest income 32,572,127.48 22,648,412.21
P/L on foreign exchange 9,952,753.34 20,658.20
Others 1,952,949.85 4,883,855.17
Total -12,843,438.15 -17,743,898.84
38. Other incomes
Unit: RMB
Sources of other incomes This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Government subsidies 34,307,513.06 3,561,650.56
Input VAT (plus credit) deduction 264,647.17 723,573.63
Total 34,572,160.23 4,285,224.19
Government subsidies included in other income:
201
2020 Annual Report of Songcheng Performance Development Co., Ltd
Related to
Amount of
Subsidy items Amount of this period assets/related to
Previous Period
income
1. Government subsidies directly confirmed in this
33,681,754.57 1,885,679.93
period
Unemployment insurance supports subsidies for
1,447,638.48 Related to income
enterprises to stabilize jobs
Financial support funds 14,000,000.00 811,400.00 Related to income
Enterprise practical training and social insurance
510,905.87 1,050,250.93 Related to income
subsidies
Return of service charge for individual income tax
312,209.68 24,029.00 Related to income
collection
Epidemic subsidy 16,858,300.00 Related to income
Others 552,700.54 Related to income
2. Government subsidies transferred from deferred
625,758.49 1,675,970.63
income
Discount interest for engineering project of
142,857.24 142,857.24 Related to assets
international animation museum
Cultural and creative funds for "Lijiang Love Song"
20,000.04 20,000.04 Related to assets
project
Modern service industry funds for toilet project of
6,500.04 6,500.04 Related to assets
Songcheng scenic area
Modern service industry special funds for tourism
planning and construction of Xianghu Romance 52,130.04 52,130.04 Related to assets
Show
"The Phantom of the Ancient Tree" and the
1,277,250.01 Related to assets
reconstruction of flower lane food street
Subsidies for Longquan mountain ecological
48,999.96 48,999.97 Related to assets
rehabilitation project
Subsidies for Guilin Lijiang Romance, folk culture,
24,999.96 24,999.96 Related to assets
leisure tourism and performance
202
2020 Annual Report of Songcheng Performance Development Co., Ltd
Related to
Amount of
Subsidy items Amount of this period assets/related to
Previous Period
income
Special funds for planning and construction of
modern service industry municipal issued by
Tourism Commission for the reconstruction project 66,159.96 27,566.66 Related to assets
of No. 2 Theater Complex in Songcheng Romance
Park
Special funds of Hangzhou modern service industry
tourism for construction of new entrance hall 8,000.03 666.67 Related to assets
washroom
The guiding funds of Guilin Lijiang service industry
for Guilin Romance folk culture leisure tourism 75,000.00 75,000.00 Related to assets
performance project
Hangzhou modern service industry guiding funds
13,445.00 Related to assets
for the cable car project
The special funds for development of modern
service industry issued by Development and
83,330.00 Related to assets
Reform Bureau of Wulingyuan District of
Zhangjiajie
The special funds for tourism development issued
21,170.00 Related to assets
by Zhangjiajie Municipal Finance Bureau
Hangzhou modern service industry tourism special
funds issued by Hangzhou Culture, Radio, Film and
Television Tourism Bureau for major leisure
4,083.33 Related to assets
tourism construction, the upgrading and
renovation of scenic spots, and tourism planning
projects
The special subsidies for tourism (tourism toilet) 749.58 Related to assets
Jiuzhai cultural industry development special funds 58,333.31 Related to assets
Total 34,307,513.06 3,561,650.56
203
2020 Annual Report of Songcheng Performance Development Co., Ltd
39. Investment income
Unit: RMB
Previous Period's Amount of
Item This Period's Amount of Occurrence
Occurrence
Long-term equity investment income
-5,356,968.22 72,523,327.47
measured by equity method
Investment income from disposal of long-term
-27,274.40
equity investment
Investment income from disposal of trading
19,371,860.52 51,069,524.28
financial assets
After losing control, the remaining equity is
149,600,667.33
re-measured at fair value
Total 14,014,892.30 273,166,244.68
40. Income from changes in fair value
Unit: RMB
Source of the income from changes in fair
This Period's Amount of Occurrence Previous Period's Amount of Occurrence
value
Trading Financial Assets 247,726.31 991,859.52
Total 247,726.31 991,859.52
41. Credit impairment loss
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Bad debt losses of other receivables -32,551,183.69 -933,666.76
Bad debt losses of accounts receivable -188,793.22 2,259,651.28
Total -32,739,976.91 1,325,984.52
42. Asset impairment loss
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Long-term equity investment impairment
-1,861,297,284.90
loss
Goodwill impairment loss -16,422,870.82 -17,425,960.27
Total -1,877,720,155.72 -17,425,960.27
204
2020 Annual Report of Songcheng Performance Development Co., Ltd
43. Income from asset disposal
Unit: RMB
Sources of the asset disposal income This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Total gains from disposal of non-current
676,435.92 -767,848.08
assets
Of which: gains from disposal of fixed
676,435.92 -83,042.30
assets
Gains from disposal of intangible assets
Other long-term asset disposal gains -684,805.78
Total 676,435.92 -767,848.08
44. Non-operating income
Unit: RMB
Amount recorded into
This Period's Amount of Previous Period's Amount of
Item non-recurring profit and loss in
Occurrence Occurrence
current period
Government subsidies 1,046,433.96 1,344,754.19 1,046,433.96
Liquidated damages, fine
1,302,066.30 1,123,750.98 1,302,066.30
income
Waste disposal income 466,299.22 327,092.18 466,299.22
Accounts payable that cannot
10,120.52 518,932.83 10,120.52
be paid
Others 417,457.14 2,683,307.85 417,457.14
Total 3,242,377.14 5,997,838.03 3,242,377.14
Government subsidies recorded into current period P/L:
Unit: RMB
Subsidies
Influence Previous
Special This period's Related to
Distributing Distributing Types of Profit and period's
Subsidy items Subsidy or amount of assets/relate
Entity Reason Nature Loss in the amount of
not occurrence d to income
Current Year occurrence
or not
Subsidies for
Related to
stable 181,704.19
income
positions
Four-Star Related to
1,000,000.00
Meritorious income
205
2020 Annual Report of Songcheng Performance Development Co., Ltd
Enterprise
Support
Funds of Year
2018
The cultural
Related to
and creative 30,000.00
income
funds
Subsidies for
"Creating a Related to
50,000.00
National income
Civilized City"
Incentives for
new
enterprises Related to
240,000.00 50,000.00
above income
designated
size
The special
reward funds
issued by
Ningxiang
Related to
Development 10,000.00
income
and Reform
Bureau for
service
industry
The special
reward funds
for Xiqiao
Related to
Mountain 10,000.00
income
cultural
tourism
“Eagle" plan
The special
support
Related to
funds for 100,000.00
income
tourism
development
Award for
Related to
investment 100,000.00
income
promotion
Subsidies for 300,000.00 Related to
206
2020 Annual Report of Songcheng Performance Development Co., Ltd
cultural income
industry
Related to
Others 306,433.96 13,050.00
income
Total 1,046,433.96 1,344,754.19
45. Non-operating expenses
Unit: RMB
Amount recorded into
This Period's Amount of Previous Period's Amount of
Item non-recurring profit and loss in
Occurrence Occurrence
current period
Loss from damage and
destruction of non-current 38,302,318.05 77,834,592.21 38,302,318.05
assets
Public welfare donations 300,000.00 12,000,000.00 300,000.00
Non-public welfare donations 93,000.00 602,450.00 93,000.00
Compensation expenditure 2,020,885.17 5,002,395.18 2,020,885.17
Others 291,676.21 6,077,566.51 291,676.21
Total 41,007,879.43 101,517,003.90 41,007,879.43
46. Income tax expenses
(1) Income tax expenses table
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Current income tax expense 42,291,502.79 265,749,412.31
Deferred income tax expense -12,456,333.68 -596,845.22
Total 29,835,169.11 265,152,567.09
(2) Reconciliation of accounting profits and income tax expenses
Unit: RMB
Item This Period's Amount of Occurrence
Total Profit -1,737,110,708.89
Income tax expense calculated at statutory/applicable tax rate -434,277,677.22
Impact by applying different tax rates to subsidiaries -38,596,484.69
Impact of income tax before adjustment in this period 6,660,254.34
207
2020 Annual Report of Songcheng Performance Development Co., Ltd
Impact of non-taxable income -501,619.10
Impact of the non-deductible costs, expenses and losses 194,030,661.96
The effect of using deductible losses of deferred income tax
-1,281,397.39
assets that have not been recognized in the previous period
The effect of unrecognized deductible temporary differences of
deferred income tax assets or unrecognized deductible losses in 303,801,431.21
the current period
Income tax expense 29,835,169.11
47. Other comprehensive income
For details, please refer to Note 7 (29) Other Comprehensive Income.
48. Items of Cash Flow Statement
(1) Other cash receipts relating to operating activities
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Interest Income 35,986,922.00 19,233,617.69
Non-operating Revenue 2,185,822.66 4,134,151.01
Government financial subsidies 40,101,488.53 377,084,434.12
Receipt of current account 25,497,842.41 79,204,201.30
Total 103,772,075.60 479,656,404.12
(2) Other cash payments relating to operating activities
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Expenses 133,608,090.57 213,101,617.02
Non-Operating Expenses 2,705,561.38 18,894,676.91
Payment of current account 20,821,514.98 99,074,449.48
Total 157,135,166.93 331,070,743.41
(3) Other cash paid in connection with investment activities
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
208
2020 Annual Report of Songcheng Performance Development Co., Ltd
Cash brought out from decrease of
345,075,573.87
consolidated scope in the current period
Total 345,075,573.87
49. Supplementary information about Cash Flow Statement
(1) Supplementary information about the Cash Flow Statement
Unit: RMB
Supplementary information Amount of this period Amount of Previous Period
1． Reconciliation of net profit to cash flows
-- --
from operational activities:
Net Profit -1,766,945,878.00 1,364,903,511.20
Add: provision for impairment of assets 1,910,460,132.63 16,099,975.75
Depreciation of fixed assets, oil
201,385,250.67 183,251,114.66
and gas assets, productive biological assets
Depreciation of right-of-use assets
Amortization of Intangible Assets 56,669,812.67 44,633,069.92
Amortization of long-term prepaid
35,034,022.89 28,611,261.50
expenses
Losses on disposal of fixed assets,
intangible assets and other long-term assets -676,435.92 767,848.08
(mark "-" for incomes)
Losses on scrapping of fixed assets
38,302,318.05 77,834,592.21
(mark "-" for incomes)
Losses on fair value changes (mark
-247,726.31 -991,859.52
"-" for incomes)
Financial expenses (mark "-" for
17,775,739.48 20,658.20
incomes)
Losses on investment (mark "-" for
-14,014,892.30 -273,166,244.68
incomes)
Decrease on deferred income tax
-9,318,905.44 -525,776.05
assets (mark "-" for increases)
Increase on deferred income tax
-3,137,428.24 -71,069.17
liabilities (mark "-" for decreases)
Decrease on inventories (mark "-"
-1,993,817.28 -2,841,747.50
for increases)
Decrease on operational -44,275,900.28 -10,269,859.84
209
2020 Annual Report of Songcheng Performance Development Co., Ltd
receivables (mark "-" for increases)
Increase on operational payables
-25,074,392.68 143,196,024.75
(mark "-" for decreases)
Others
Net cash flow generated by
393,941,899.94 1,571,451,499.51
operating activities
2． Major investing and financing activities
-- --
not involving cash receipts and payment:
Conversion of debt into capital
Convertible corporate bonds due within
one year
Fixed assets under financing lease
3． Net changes in cash and cash
-- --
equivalents:
Closing balance of cash 1,337,776,253.98 1,781,710,027.35
Less: opening balance of cash 1,781,710,027.35 1,549,948,352.47
Add: closing balance of cash
equivalents
Less: opening balance of cash
equivalents
Net additions to balance of equivalents -443,933,773.37 231,761,674.88
(2) Net cash payments for acquisition of subsidiaries in this period
Unit: RMB
Amount
Cash or cash equivalents used for the acquisition occurred in this
378,000,000.00
period and paid in this period
Including: --
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. 378,000,000.00
Less: cash and cash equivalents held by acquired subsidiaries 232,493.05
Including: --
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. 232,493.05
Including: --
Net cash paid for acquisition of subsidiaries 377,767,506.95
210
2020 Annual Report of Songcheng Performance Development Co., Ltd
(3) Composition of cash and cash equivalents
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
Ⅰ. Cash 1,337,776,253.98 1,781,710,027.35
Including: cash on hand 2,437,262.81 2,237,068.96
Bank deposit for payment at any
1,285,458,896.93 1,777,193,843.97
time
Other cash and bank balances for
49,880,094.24 2,279,114.42
payment at any time
Ⅲ. Closing balance of cash and cash
1,337,776,253.98 1,781,710,027.35
equivalents
50. Monetary items in foreign currencies
(1) Monetary items in foreign currencies
Unit: RMB
Closing balance in foreign Closing Balance Converted into
Item Exchange rate for conversion
currencies RMB
Cash and Bank Balances -- -- 116,361,440.06
Including: USD 16,297,538.73 6.52490 106,339,810.45
EUR
HKD 2,990,481.28 0.84164 2,516,908.66
AUD 1,330,254.69 5.01630 6,672,956.60
THB 3,817,534.18 0.21788 831,764.35
(2) Notes on overseas business entities, including that for the important overseas business entities, the
overseas main premises, functional currency and selection basis shall be disclosed. If there are changes on its
functional currency, the causes for the changes shall be disclosed as well.
√ Applicable □ Not applicable
The overseas operating entities of the company include Songcheng Performance International Development Co., Ltd.,
Songcheng (Australia) Entertainment Pty Ltd., Songcheng (Australia) Entertainment Pty Ltd.., Songcheng Holdings (Thailand) Co ., Ltd.
and Songcheng (Pattaya) International Culture Co., Ltd. The operating place respectively in Hong Kong, China, Queensland, Australia,
Bangkok, Thailand, and Pattaya, Thailand. The standard currency for bookkeeping is Hong Kong dollars, Australian dollars and Thai
baht by considering the needs of local business development.
211
2020 Annual Report of Songcheng Performance Development Co., Ltd
51. Government grants
(1) Basic information about government subsidies
Unit: RMB
Types Amount Items reported Amount taken to current P&L
Government subsidies related
5,373,300.00 Deferred Income 625,758.49
to daily operating activities
Government subsidies related
33,681,754.57 Other Incomes 33,681,754.57
to daily operating activities
Government subsidies
unrelated to daily operating 1,046,433.96 Non-operating Revenue 1,046,433.96
activities
VIII. Changes in the Scope of Consolidation
1. Consolidation not under the common control
(1) Consolidation not under the common control in this period
Unit: RMB
Income of Net Profit of
Acquired Acquired
Basis for Party from Party from
Time Point Cost for
Name of Percentage Acquisition Acquisition Determining the the
for Equity Equity
Acquiree Acquired Method Date Acquisition Acquisition Acquisition
Acquisition Acquisition
Date Date to the Date to the
End of the End of the
Period Period
Zhuhai
Complete the
Southern
industrial and
Film and
April 26, 378,000,000. Acquisition in April 26, commercial -16,469,469.
Television 100.00%
2020 00 cash 2020 changes and 80
Cultural
the payment
Industry Co.,
is completed
Ltd.
(2) Consolidation costs and goodwill
Unit: RMB
Consolidated Cost Zhuhai Southern Film and Television Cultural Industry Co., Ltd.
-- Cash 378,000,000.00
212
2020 Annual Report of Songcheng Performance Development Co., Ltd
Total cost of business combination 378,000,000.00
Less: fair value of identifiable net assets acquired 378,000,000.00
Other notes:
In this period, the company acquired 100% equity of Zhuhai South Film& Television Culture Industry Co., Ltd. According to the
"Asset Appraisal Report"(No.311,ZGXpingbaozi of Year 2019) issued by Guangdong ZGX Assets Appraisal Co., LTD, the transaction
price after negotiation was RMB 378 million. After the acquisition, the company holds 100% of the equity of Zhuhai South Film&
Television Culture Industry Co., Ltd. Zhuhai Southern Film& Television Cultural Industry Co., Ltd. has a subsidiary, Zhuhai H uayin
Landscaping Co., Ltd., with 55% of its shares
(3) Identifiable assets and liabilities of acquired party at the acquisition date
Unit: RMB
Zhuhai Southern Film and Television Cultural Industry Co., Ltd.
Fair Value at Acquisition Date Book Value at Acquisition Date
Assets: 501,274,360.46 103,544,459.10
Cash and Bank Balances 232,493.05 232,493.05
Inventory 5,320,107.66 5,320,107.66
Fixed Assets 1,020,592.33 1,020,592.33
Intangible Assets 428,028,880.81 30,298,979.45
Other Receivables 2,353,177.16 2,353,177.16
Projects under Construction 64,080,763.76 64,080,763.76
Other long-term assets 238,345.69 238,345.69
Liabilities: 124,035,829.79 25,290,165.83
Payables 25,235,805.73 25,235,805.73
Other liabilities 98,800,024.06 54,360.10
Net Assets 377,238,530.67 78,254,293.27
Less: Equity of minority shareholders -761,469.33 -761,469.33
Net assets acquired 378,000,000.00 79,015,762.60
(4) Profits or losses from re-measurement of equity held before acquisition date in fair value
Is there any transaction that leads to business consolidation achieved through multiple transactions in various stages with control
acquired within the reporting period
□ Yes √ No
2. Disposal of subsidiaries
Is there any situation where disposal of investment in subsidiaries in a single transaction causes loss of control
213
2020 Annual Report of Songcheng Performance Development Co., Ltd
□ Yes √ No
Is there any situation where disposal of investment in subsidiaries is achieved through multiple transactions in various stag es,
causing loss of control in this period
□ Yes √ No
3. Changes in the scope of combination for other reasons
Explanations on the changes in the scope of consolidation caused by other reasons (for example, newly established subsidiaries,
subsidiaries clearing, etc.) and relevant information:
(1) There are 5 new merged units in the current period due to the following reasons:
New Merged Units This Year Investment Ratio Notes
Zhuhai Songcheng Performance Kingdom Co., Ltd 100% New in 2020
Zhuhai Southern Film and Television Cultural 100% Acquire 100% equity in 2020
Industry Co., Ltd.
Zhuhai Huayin Landscaping Co., Ltd. 55% 55% holding subsidiary affiliated
Zhuhai Southern Film and Television Cultural
Industry Co., Ltd. acquired in 2020
Songcheng Brand Management Co., Ltd. 100% New in 2020
Romance Show Management Co., Ltd. 100% New in 2020
(2) The number of merged units was decreased by 2 in the current period due to:
Reduced Merged Units This Year Investment Ratio Notes
Hangzhou Songcheng Art Troupe Co., Ltd. 100.00% Canceled in 2020
Zhejiang Songcheng Entertainment Culture Co., 100.00% Canceled in 2020
Ltd.
IX. Equity in Other Entities
1. Equity in Subsidiaries
(1) Composition of the enterprise group
Name of Main Place of Registered Shareholding Percentage Acquisition
Business Nature
Subsidiaries Business Address Direct Indirect Method
Hangzhou Hangzhou, Hangzhou, Development of
100.00% Establishment
Paradise Co., Ltd. Zhejiang Zhejiang tourism project
Sanya Romance
Tourism Theme park + Art
Sanya, Hainan Sanya, Hainan 100.00% Establishment
Performance Co., performance
Ltd.
Lijiang Chama Theme park + Art
Lijiang, Yunnan Lijiang, Yunnan 100.00% Establishment
Ancient City performance
214
2020 Annual Report of Songcheng Performance Development Co., Ltd
Tourism
Development Co.,
Ltd
Aba Zhou Jiuzhai Business
Romance Tourism Jiuzhaigou, Aba, Jiuzhaigou, Aba, Theme park + Art combination not
100.00%
Development Co., Sichuan Sichuan performance under common
Ltd control
Hangzhou
Songcheng Network
Hangzhou, Hangzhou,
Tourism technology, 100.00% Establishment
Zhejiang Zhejiang
Development Co., e-commerce
Ltd
Hangzhou
Domestic
Songcheng Hangzhou, Hangzhou,
tourism, inbound 100.00% Establishment
Dumuqiao Travel Zhejiang Zhejiang
tourism
Services Co., Ltd
Business
Jiuzhaigou
Jiuzhaigou, Aba, Jiuzhaigou, Aba, Development of combination not
Tibetan Mystery 60.00%
Sichuan Sichuan tourism project under common
Culture Co., Ltd
control
Passenger
cableway
Zhejiang operation and
Songcheng management;
Longquan initial tourist
Longquan, Longquan,
Mountain passenger 100.00% Establishment
Zhejiang Zhejiang
Tourism transportation;
Development Co., tourism services,
Ltd theme park
development and
operation
Technology
development,
technology
Hangzhou services and
Songcheng achievement
Hangzhou, Hangzhou,
Technology transfer of smart 100.00% Establishment
Zhejiang Zhejiang
Development Co., entertainment
Ltd. products; sales
and consulting
services of
technology
215
2020 Annual Report of Songcheng Performance Development Co., Ltd
products;
Internet
information
services
Foreign
investment;
cultural
Songcheng
performance;
Performance
leisure tourism;
International Hong Kong, China Hong Kong, China 100.00% Establishment
international
Development Co.,
cultural and
Ltd.
entertainment
cooperation and
development
Cultural
performance;
leisure tourism;
Songcheng
Queensland, Queensland, international
(Australia) 100.00% Establishment
Australia Australia cultural and
Holdings Pty Ltd
entertainment
cooperative
development
Cultural
performance;
leisure tourism;
Songcheng
international
(Australia) Queensland, Queensland,
cultural, film and 100.00% Establishment
Entertainment Australia Australia
television
Pty Ltd.
entertainment
cooperation
development
Performance
venue
management,
Shanghai
planning for
Songcheng World
cultural and
Expo
Shanghai Shanghai artistic exchange 88.00% Establishment
Performance
activities,
Development Co.,
industrial
Ltd
investment,
investment
management
Songcheng Shanghai Shanghai Performance 100.00% Establishment
216
2020 Annual Report of Songcheng Performance Development Co., Ltd
Performance venues,
Development performance
(Shanghai) Co., brokers,
Ltd. entertainment
venues (singing
and dancing
entertainment
venues,
amusement
entertainment
venues), travel
agency business,
cultural and
artistic exchange
activities
planning, public
relations
campaign
planning
Tourism project
investment and
development,
Guilin Lijiang
cultural activities
Romance
Yangshuo, Guilin, Yangshuo, Guilin, planning, cultural
Performance 70.00% Establishment
Guangxi Guangxi communication
Development Co.,
planning, leisure
Ltd
industry
investment and
development.
Planning, design,
development and
management of
Ningxiang scenic spot;
Songcheng literary and
Tourism Changsha, Hunan Changsha, Hunan artistic creation 100.00% Establishment
Development Co., services;
Ltd. engineering
project
management
services;
Zhangjiajie Operating
Zhangjiajie, Zhangjiajie,
Romance performances 100.00% Establishment
Hunan Hunan
Performance and economic
217
2020 Annual Report of Songcheng Performance Development Co., Ltd
Development Co., business; various
Ltd performances;
parking,
performance
venue
management,
tourism services;
theme park
development and
operation,
cultural activities
planning
Technology
development,
Songcheng
technical service
Technology
Yili, Xinjiang Yili, Xinjiang and achievement 100.00% Establishment
Development
transfer of smart
Co.,Ltd.
entertainment
products
Tourism resource
development,
tourism planning
Songcheng
and design,
Tourism
Yili, Xinjiang Yili, Xinjiang artistic creation, 100.00% Establishment
Development Co.,
brand and
Ltd.
marketing
planning of
tourist attractions
Performance,
artistic creation
and
Songcheng
choreography,
Performance
Horgos, Xinjiang Horgos, Xinjiang performance and 100.00% Establishment
Management Co.,
brokerage
Ltd.
business,
performance
management
Network
technology;
Songcheng
Hangzhou, Hangzhou, computer
Dumuqiao 100.00% Establishment
Zhejiang Zhejiang software and
Network Co., Ltd.
hardware; data
processing and
218
2020 Annual Report of Songcheng Performance Development Co., Ltd
analysis
technology
development;
technical
consulting,
services, and
transfer of
achievements;
booking tickets of
scenic spots, air
tickets,
performance
tickets and room
reservations for
customers;
tourist
information
consulting,
domestic
tourism, and
inbound tourism
Performance
activities;
performance
Xi'an Romance
brokerage;
Performance
Xi'an, Shanxi Xi'an, Shanxi catering services; 80.00% Establishment
Development Co.,
tourism services;
Ltd
theme park
development and
operation;
Organization and
planning of
Zhejiang cultural and
Songcheng Xitang artistic exchange
Performance Jiashan county, Jiashan county, activities; cultural
Valley Jiaxing city, Jiaxing city, communication 100.00% Establishment
Performance Zhejiang Zhejiang planning; tourism
Development Co., services; theme
Ltd park
development and
operation;
Foshan South Sea Foshan, Foshan, Organization and Business
100.00%
Qiao Mountain Guangdong Guangdong planning of combination not
219
2020 Annual Report of Songcheng Performance Development Co., Ltd
Cultural Tourism cultural and under common
Development Co., artistic exchange control
Ltd activities; cultural
communication
planning; tourism
services; theme
park
development and
operation;
Sales: tourism
supplies and arts
& crafts
Hangzhou
Hangzhou, Hangzhou, (excluding gold
Songguo Cultural 100.00% Establishment
Zhejiang Zhejiang ornaments), daily
Creative Co., Ltd.
necessities, local
specialties
(excluding food)
Music
performances,
opera
Hangzhou performances,
Songcheng cabaret
performance performances,
Hangzhou, Hangzhou,
Valley technology acrobatic 100.00% Establishment
Zhejiang Zhejiang
and Culture performances;
Development Co., performance
Ltd brokers; smart
entertainment
products; cultural
creative design
Foreign
investment;
cultural
Songcheng performance;
Holdings Bangkok, Bangkok, leisure tourism;
100.00% Establishment
(Thailand) Co., Thailand Thailand international
Ltd. cultural and
entertainment
cooperation and
development
Songcheng Cultural
(Pattaya) Pattaya, Thailand Pattaya, Thailand performance, 65.00% Establishment
International including live
220
2020 Annual Report of Songcheng Performance Development Co., Ltd
Culture Co., Ltd. shows of theater
performances
(singing and
dancing,
acrobatics,
drama, music,
etc.); high-tech
interactive
experience;
cultural activities
planning, tourism
e-commerce
Music
performances,
opera
performances,
cabaret
performances;
acrobatics,
Zhuhai
tourism services,
Songcheng Zhuhai, Zhuhai,
theme park 100.00% Establishment
Performance Guangdong Guangdong
development and
Kingdom Co., Ltd
operation,
cultural activities
planning and
organization,
cultural
communication
planning
Project
development,
operation and
management of
film and
Zhuhai Southern television
Business
Film and industry;
Zhuhai, Zhuhai, combination not
Television development, 100.00%
Guangdong Guangdong under common
Cultural Industry operation and
control
Co., Ltd. management of
tourism projects;
real estate
development;
business services
and commercial
221
2020 Annual Report of Songcheng Performance Development Co., Ltd
wholesale and
retail
Landscaping
Business
Zhuhai Huayin project; planting
Zhuhai, Zhuhai, combination not
Landscaping Co., and sales of 55.00%
Guangdong Guangdong under common
Ltd. flowers and
control
seedlings
Tourism resource
development;
tourism planning
and design;
artistic creation;
brand planning of
scenic spots;
marketing
Songcheng Brand
planning of
Management Co., Yili, Xinjiang Yili, Xinjiang 100.00% Establishment
scenic spots;
Ltd.
scenic project
construction;
domestic
tourism, inbound
tourism and
ticket agency;
ticket sales of
scenic spots;
Performance:
singing and
dancing, opera,
acrobatics;
artistic creation
Romance Show and
Management Co., Yili, Xinjiang Yili, Xinjiang choreography; 100.00% Establishment
Ltd. operating
performance and
brokerage
business;
performance
management
(2) Important non-wholly-owned subsidiaries
Unit: RMB
Name of Subsidiaries Minority shareholding Profit and loss attributed Dividends declared to Balance of equity of
222
2020 Annual Report of Songcheng Performance Development Co., Ltd
ratio of shareholders to minority shareholders minority shareholders in minority shareholders at
in the current period the current period the end of the period
Jiuzhaigou Tibetan
40.00% -2,349,016.01 16,399,460.63
Mystery Culture Co., Ltd
Guilin Lijiang Romance
Performance 30.00% -4,215,601.40 3,000,000.00 195,989,790.91
Development Co., Ltd
Xi'an Romance
Performance 20.00% -2,387,064.76 117,360,184.30
Development Co., Ltd
(3) Main financial information of important non-wholly-owned subsidiaries
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Name of Non-cur Non-cur
Non-curr Current Total Non-curr Current Total
Subsidia Current Total rent Current Total rent
ent Liabilitie Liabilitie ent Liabilitie Liabilitie
ries Assets: assets Liabilitie Assets: assets Liabilitie
Assets: s: s Assets: s: s
s: s:
Jiuzhaig
ou
Tibetan 1,297,947 46,142,45 47,440,40 6,441,75 6,441,75 5,727,182 47,853,29 53,580,47 6,709,28 6,709,28
Mystery .70 4.10 1.80 0.22 0.22 .98 2.04 5.02 3.41 3.41
Culture
Co., Ltd
Guilin
Lijiang
Romanc
e
216,867,0 488,091,5 704,958,5 49,871,7 1,787,5 51,659,2 238,983,2 503,265,2 742,248,5 63,009,7 1,887,5 64,897,2
Perform
03.96 53.05 57.01 53.88 00.08 53.96 50.86 64.52 15.38 07.63 00.04 07.67
ance
Develop
ment
Co., Ltd
Xi'an
Romanc
e
Perform 100,441,8 334,190,9 434,632,8 42,815,3 16,518. 42,831,9 47,539,16 51,645,83 99,185,00 329,370. 119,386 448,757.
ance 75.70 60.08 35.78 96.19 08 14.27 6.38 6.50 2.88 93 .65 58
Develop
ment
Co., Ltd
223
2020 Annual Report of Songcheng Performance Development Co., Ltd
Unit: RMB
This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Cash flow
Name of --Total Cash flow from --Total
Operating Operating from
Subsidiaries Net Profit comprehensiv operating Net Profit comprehensiv
income income operating
e income activities e income
activities
Jiuzhaigou
Tibetan
-6,213,222.8
Mystery 4,750.00 -5,872,540.03 -5,872,540.03 -2,902,841.54 444,983.82 -6,213,222.80 -204,706.45
0
Culture Co.,
Ltd
Guilin
Lijiang
Romance
56,586,027.0 -14,052,004.6 -14,052,004.6 -135,213,013.7 160,649,726.5 34,088,201.5 34,088,201.5 61,580,333.7
Performanc
7 6 6 9 1 8 8 1
e
Developme
nt Co., Ltd
Xi'an
Romance
Performanc 25,002,178.1 -11,935,323.7 -11,935,323.7 -1,521,549.1 -2,797,915.3
479,044.63 -1,521,549.12
e 4 9 9 2 1
Developme
nt Co., Ltd
2. The transactions that lead to changes in the shareholder's equity in the subsidiaries while still has working
control over the subsidiary
(1) Explanation of the changes in the shareholder's equity in the subsidiaries
In this period, the company acquired 20% of the shares held by the minority shareholders of Aba Zhou Jiuzhai Romance
Tourism Development Co., Ltd. After the acquisition, the shareholding ratio of the company increased from 80% to 100%.
(2) The effect of the transactions on the equity of the minority shareholders and the shareholder's equity
attributable to the parent company
Unit: RMB
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd
-- Cash 82,500,000.00
Purchase cost/ Total disposal consideration 82,500,000.00
Less: the share of net assets of the subsidiary calculated based 47,040,672.62
224
2020 Annual Report of Songcheng Performance Development Co., Ltd
on the ratio of equity obtained/disposed
Difference 35,459,327.38
Among them: adjust the capital reserve 35,459,327.38
3. Equity in joint venture arrangements or affiliates
(1) Important joint ventures or associates
Shareholding Percentage Method for
Names of accounting the
Main Place of Registered
associates and Business Nature investment in
Business Address Direct Indirect
joint ventures associates and
joint ventures
Internet
information
service,
performance
Beijing Huafang
brokerage
Technology Co.,
business,
Ltd. (formerly
business on
known as Beijing Beijing Beijing 37.06% Equity method
music
Six Rooms
entertainment
Technology Co.,
products through
Ltd.)
information
network,
competition
activities
Technical
development,
system
integration,
Beijing Beite installation and
Shengdi commissioning of
Technology Beijing Beijing stage machinery, 20.00% Equity method
Development Co., stage machinery
Ltd. control, lighting,
and sound
equipment; stage
craft design and
consultation;
225
2020 Annual Report of Songcheng Performance Development Co., Ltd
(2) Main financial information of important associates
Unit: RMB
Closing balance / accrual of current period Opening balance / accrual of previous period
Beijing Huafang Beijing Huafang
Technology Co., Ltd. Beijing Beite Shengdi Technology Co., Ltd. Beijing Beite Shengdi
(formerly known as Technology Development (formerly known as Technology Development
Beijing Six Rooms Co., Ltd. Beijing Six Rooms Co., Ltd.
Technology Co., Ltd.) Technology Co., Ltd.)
Current Assets: 1,396,296,667.81 379,808,015.42 1,623,101,725.04 310,188,962.98
Non-current Assets: 486,246,315.46 3,393,303.08 373,417,147.13 2,788,642.93
Total assets 1,882,542,983.27 383,201,318.50 1,996,518,872.17 312,977,605.91
Current Liabilities: 367,981,352.22 240,656,075.91 561,792,512.12 176,467,728.58
Non-current Liabilities: 10,851,396.40 1,300,010.10 11,664.93 741,741.98
Total Liabilities 378,832,748.62 241,956,086.01 561,804,177.05 177,209,470.56
Minority Shareholders'
-4,903.84
Equity
Equity attributable to
shareholders of the 1,503,710,234.65 141,250,136.33 1,434,714,695.12 135,768,135.35
parent company
Share of net assets
calculated based on 557,275,012.96 28,250,027.27 567,142,718.98 27,153,627.07
shareholding ratio
Adjustments 935,652,356.70 13,362,228.18 2,859,309,634.07 14,990,184.96
--Goodwill 935,652,356.70 16,825,620.50 2,859,309,634.07 16,825,620.50
Unrealized Profit from
-3,463,392.32 -1,835,435.54
Internal Transactions
Book value of equity
1,492,927,369.66 41,612,255.45 3,426,452,353.05 42,143,812.03
investment in associates
Operating income 3,777,442,691.41 321,940,699.67 2,367,480,161.77 338,824,205.43
Net Profit -10,799,124.63 5,477,097.14 171,411,433.44 28,753,895.05
Other Comprehensive
3,431,790.00 -3,431,790.00
Incomes
--Total comprehensive
-7,367,334.63 5,477,097.14 167,979,643.44 28,753,895.05
income
Other explanation: The above data of statement was presented based on the fair value of the identifiable assets and liabiliti es of the
investee when the investment was obtained.
226
2020 Annual Report of Songcheng Performance Development Co., Ltd
X. Risks Relating to Financial Instruments
The company faces various financial risks in the course of its operations: credit risk, liquidity risk and market risk (including
exchange rate risk, interest rate risk and other price risks). The Board of Directors of the company is fully responsible for the
determination of risk management objectives and bears the corresponding ultimate responsibility. The Board of Directors requi res
the management to design and implement procedures that can ensure the effective implementation of risk management objectives
and policies. The company’s management reviews the effectiveness of the implemented procedures and the rationality of risk
management objectives and policies through quarterly reports submitted by the Financial Department. The Treasury Department o f
the company audits the risk management policies and procedures, and report relevant findings to the company’s management.
The overall objective of the Company's risk management is to formulate risk management policies that can minimize risks
without affecting the Company's competitiveness and adaptability to changes too much.
The company diversifies the risk of financial instruments by appropriate diversified investment and business portfolio. In
addition, corresponding risk management policy is formulated to reduce the risk of concentration in single industry, specific region
or specific counter party.
(I) Credit risk
Credit risk refers to the risk of the company's financial losses due to the failure of the counterparty to perform its contra ctual
obligations.
The company’s credit risk mainly arises from monetary funds, notes receivable, accounts receivable, accounts receivable
financing, other receivables, debt investments, other debt investments and financial guarantee contracts, investments in debt
instruments and derivative financial assets recognized in impairment testing scope, which are measured at fair value and related
changes are recognized in the current profit and loss, etc., On the Balance Sheet date, the book value of the company’s finan cial
assets has represented its maximum credit risk exposure.
The company’s monetary funds are mainly bank deposits deposited in state -owned banks and other large and medium-sized
listed banks with high credit ratings. The company believes that there is no major credit risk, and there is almost no significant loss
resulting from breach of contract of the banks.
In addition, for bills receivable, accounts receivable, financing receivables and other receivables, the company sets relevan t
policies to control credit risk exposure. Before signing contracts, the company assesses the credit risk of new customers. The
company sets up credit limit and credit period according to different sales scale Generally, the company adopts more prudent credit
policy for new customers and increases the proportion of advance receipts. The company promptly collects the accounts receivable
from customers, and shortens or cancels the credit period for customers with bad credit records. At the same time, the compan y
ensures that the overall credit risk of the company is under control through quarterly review of the aging analysis of accounts
receivable of existing customers.
(II) Liquidity risk
Liquidity risk refers to the risk of a shortage of funds when an enterprise fulfills its obligation o f settlement by cash or other
financial assets. The Company's policy is to ensure that there is sufficient cash to repay the liabilities due. The liquidity risk is under
the concentrated control of the Company's Financial Department. Through monitoring the balance of cash and securities cashable
at any time and rolling forecasting the cash flow in the next 12 months, the Financial Department ensures that the Company ha s
sufficient funds to repay its debts under all reasonable predictions. At the same time, the Finance Department constantly monitors
whether the company complies with the provisions of the loan agreement, and obtains commitments from major financial
institutions to provide sufficient reserve funds to meet short-term and long-term funding needs.
(III) Market Risk
The market risk of financial instruments refers to the risk of fluctuation at fair value of financial instruments or future c ash
flows with the change of market prices, including exchange rate risks and interest rate risks.
1. Interest rate risk
227
2020 Annual Report of Songcheng Performance Development Co., Ltd
The interest rate risk refers to the risk in which the fair value or future cash flow of financial instruments changes due to the
change of market interest rate.
Interest-bearing financial instruments with fixed and floating interest rates expose the company to fair value interest rate risk
and cash flow interest rate risk, respectively. The company determines the proportion of fixed and floating interest rate ins truments
based on the market environment, and maintains appropriate combination of fixed and floating interest rate instruments through
regular review and monitoring.
On December 31, 2020, under the situation that other variables remain unchanged, if the borrowing rate calculated at floating
interest rates rises or falls by 100 basis points, the company’s net profit will decrease or increase by RMB 1,235,208.33 (No external
borrowing and no affected amount as of Dec 31,2019). The management believes that 100 basis points reasonably reflect the ran ge
of possible changes in interest rates in the coming year.
2. Exchange rate risk
Exchange rate risk refers to the risk that the fair value of financial instruments or future cash flows will fluctuate due to
changes in foreign exchange rates.
The company tries its best to match foreign currency income with foreign currency expenditures. At the same time, it
constantly monitors the scale of foreign currency transactions and foreign currency assets and liabilities to minimize foreig n
exchange risks. In addition, the company signs forward foreign exchange contracts or currency swap contracts to achieve the
purpose of avoiding exchange rate risks.
The foreign exchange risks faced by the company are mainly from financial assets and financial liabilities in U.S. dollars, Hong
Kong dollars, Australian dollars, and Thai baht. The amounts of foreign currency financial assets and liabilities converted into RMB
are listed as follows:
Balance at the End of the Period
Item
USD HKD AUD THB Total
Cash and Bank Balances 106,339,810.45 2,516,908.66 6,672,956.60 831,764.35 116,361,440.0
6
Trading financial assets 172,445,378.26 6,589,730.08 179,035,108.3
(financial assets that are 4
measured at fair value
and related changes are
recognized in current
profit and loss)
Other Equity Instruments 9,291,430.32 9,291,430.32
Balance at the end of the previous year
Item
USD HKD AUD THB Total
Cash and Bank Balances 6,722,634.59 2,761,248.62 169,908,170.39 987,917.54 180,379,971.1
4
Trading financial assets 110,024,148.79 110,024,148.7
(financial assets that are 9
measured at fair value
and related changes are
recognized in current
profit and loss)
Other Equity Instruments 6,294,488.76 6,294,488.76
228
2020 Annual Report of Songcheng Performance Development Co., Ltd
The foreign exchange risk arising from the above-mentioned foreign currency balance assets may have certain impact on
operating performance of the company. The company pays close attention to the impact of exchange rate changes on foreign
exchange risks of the company, and takes corresponding measures to avoid foreign exchange risks.
XI. Disclosure of Fair Values
The input values applied in fair value measurement are divided into three levels:
The first-level input value is the unadjusted quotation of the same asset or liability in the active market that can be obtained on
the measurement date.
The second-level input value is the directly or indirectly observable input value of related assets or liabilities other than the
first-level input value.
The third-level input value is the unobservable input value of related assets or liabilities.
The level of the fair value measurement result is determined by the lowest level of the input value which is of great signifi cance
to the fair value measurement as a whole.
1. Fair values of the assets and liabilities at the end of the period
Unit: RMB
Fair values at period-end
Second level
Item First level measurement Third level measurement
measurement at fair Total
at fair value at fair value
value
I. Constant measurement
-- -- -- --
at fair value
(I) Trading Financial Assets 179,035,108.34 156,182,449.34 335,217,557.68
1. Financial assets at fair
value through profit or 179,035,108.34 156,182,449.34 335,217,557.68
loss in this period
(1) Investment in debt
instruments
(2) Investment in equity
172,445,378.26 172,445,378.26
instrument
(3)Derivative Financial
6,589,730.08 6,589,730.08
Assets
(4) Bank wealth
156,182,449.34 156,182,449.34
management products
2. Designated financial
assets that are measured
at fair value and whose
changes are included in
the current profit and loss
229
2020 Annual Report of Songcheng Performance Development Co., Ltd
(1) Investment in debt
instruments
(2) Investment in equity
instrument
(II) Investment in Other
Creditor's Rights
(III) Investment in Other
224,266,596.74 224,266,596.74
Equity Instruments
(IV) Investment Property
1. Land use rights for
lease
2. Rental buildings
3. Land use rights held
and prepared to transfer
after appreciation
(V) Biological assets
1. Consumable biological
assets
2. Productive Biological
Assets
Total assets constantly
179,035,108.34 380,449,046.08 559,484,154.42
measured at fair value
(6) Transactional financial
liabilities
Including: issued trading
bonds
Derivative
Financial Liabilities
Others
(7) Financial Liabilities
measured in fair value
with changes recognized
in current profit and loss
Total amount of liabilities
constantly measured at
their fair values
II. Non-constant
measurement at fair -- -- -- --
values
230
2020 Annual Report of Songcheng Performance Development Co., Ltd
(I) Holding for-sale assets
Total amount of assets
with non-constant
measurement at fair
values
Total amount of liabilities
with non-constant
measurement at fair
values
2. The basis for determining the market price of constant and non-constant first-level fair value measurement
items
It is confirmed in accordance with the closing price of open market transactions or the quotation amount provided by
securities and fund companies as of December 31, 2020.
3. For the continuous and non-continuous third-level fair value measurement items, the valuation techniques
adopted and the qualitative and quantitative information of important parameters
For non-listed equity investment, fund investment and stock investment without public market quotation, the company applies
valuation techniques to determine its fair value, including cash flow discount method and market comparison method. Its fair value
is measured using important unobservable parameters, such as liquidity discount, fluctuation rate, risk -adjusted discount and
market multiplier. The fair value of non-listed equity investments, fund investments, and other investments has no significant
sensitivity to reasonable changes in these unobservable input values.
In 2020, the valuation techniques used by the company for the above-mentioned constant third-level fair value measurement
have not been changed.
231
2020 Annual Report of Songcheng Performance Development Co., Ltd
4. Sensitivity analysis on adjustment information between the opening and closing book value and unobservable parameters for constant third-level fair value
measurement items
Total current gain or loss Acquisition, issuance, sale and settlement For assets held at the end of the
Transfer to Transfer
Balance at the end of Recognized in other Balance at the End reporting period, the current
Item the third from the Recognized in
the previous year comprehensive Acquisition Issuance Sale Settlement of the Period unrealized gains or changes
level third level profit and loss
income recognized in the profit and loss
◆Trading financial assets 744,083,937.75 15,364,620.95 711,000,000.00 1,314,266,109.36 156,182,449.34 182,449.34
Financial assets at fair value 744,083,937.75 15,364,620.95 711,000,000.00 1,314,266,109.36 156,182,449.34 182,449.34
through profit or loss in this
period
— Investment in debt
instruments
— Investment in equity
instrument
— Derivative Financial Assets
— Bank financial products 744,083,937.75 15,364,620.95 711,000,000.00 1,314,266,109.36 156,182,449.34 182,449.34
Designated financial assets that
are measured at fair value and
whose changes are included in
the current profit and loss
— Investment in debt
instruments
— Others
◆Receivables Financing
◆Investment in Other Creditor's
Rights
◆Investment in Other Equity 300,959,931.64 -76,693,334.90 224,266,596.74
232
2020 Annual Report of Songcheng Performance Development Co., Ltd
Instruments
◆Other Non-current Financial
Assets
Financial assets at fair value
through profit or loss in this
period
— Investment in debt
instruments
— Investment in equity
instrument
— Derivative Financial Assets
— Others
Total 1,045,043,869.39 15,364,620.95 -76,693,334.90 711,000,000.00 1,314,266,109.36 380,449,046.08 182,449.34
233
2020 Annual Report of Songcheng Performance Development Co., Ltd
5. The fair value of financial assets and financial liabilities not measured at fair value
There is no significant difference between the book value and fair value of the company’s financial assets and financial
liabilities that are not measured at fair value.
XII. Related Parties and Related-party Transactions
1. The Company's Parent Company
Proportion of voting
Name of parent Registered capital Shareholding ratio of
Registered Address Business Nature rights of the parent
company (RMB ten thousand) the parent company
company
Industrial
Hangzhou investment,
Songcheng Group Hangzhou educational services, 100,000 29.48% 29.48%
Holdings Co., Ltd tourism project
development
Description of the parent company
Huang Qiaoling and related persons acting in concert directly hold 16.56% of the shares of the company. Hangzhou Songcheng
Group Holdings Co., Ltd., the controlling shareholder of the company, holds 29.48% of the shares. Huang Qiaoling and related
persons acting in concert directly and indirectly hold 100.00% of the shares of Hangzhou Songcheng Group Holdings Co., Ltd.
Huang Qiaoling and related persons acting in concert: Huang Qiaolong, Zhang Xian, Liu Ping, Huang Qiaoyan, and Dai Yinqin are
related persons acting in concert of Huang Qiaoling.
Huang Qiaoling and related persons in concert control the company by directly and indirectly holding of the sh ares.
The ultimate controlling party of the company is Huang Qiaoling.
234
2020 Annual Report of Songcheng Performance Development Co., Ltd
2. Information about the Company's subsidiaries
For details of subsidiaries of the Company, see Note "IX. Equities in other entities".
3. Information about the Company's joint ventures and affiliates
For details of significant joint ventures and associates of the Company, see Note "IX. Equities in other entities".
Names of joint ventures and affiliates Relationship with the Company
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing
Affiliate
Six Rooms Technology Co., Ltd.)
Beijing Beite Shengdi Technology Development Co., Ltd. Affiliate
SABH's Big Adventure Inc. Holds 11.0082% equity
4. Information about other related parties
Names of other related parties Relationship between the Company and other related parties
Huang Qiaolong Related natural person of Huang Qiaoling
Zhang Xian Related natural person of Huang Qiaoling
Liu Ping Related natural person of Huang Qiaoling
Huang Qiaoyan Related natural person of Huang Qiaoling
Dai Yinqin Related natural person of Huang Qiaoling
Hangzhou World Leisure Expo Park Co., Ltd Under the control of Huang Qiaoling
Hangzhou Songcheng Industry Co., Ltd Under the control of Huang Qiaoling
Hangzhou First World Hotel Co., Ltd. Under the control of Huang Qiaoling
Longquan Mountain Resort Co., Ltd. Under the control of Huang Qiaoling
Qiyun Holdings (Thailand) Co., Ltd.
Under the control of Huang Qiaoling
（Qiyun Holding (Thailand) Co., Ltd.）
Xi'an International Horticultural Exposition Investment (Group)
Holds 20% of the company’s holding subsidiary
Co., Ltd.
Shanghai World Expo Dongdi Cultural Development Co., Ltd. Holds 12% of the company’s holding subsidiary
Guangzhou Gening Green Engineering Co., Ltd. Holds 35% of the company’s holding subsidiary
Zhongshan Dehua Green Engineering Co., Ltd. Holds 10% of the company’s holding subsidiary
235
2020 Annual Report of Songcheng Performance Development Co., Ltd
5. Information about related-party transactions
(1) Related-party transactions involving purchase and selling of merchandise and provision and acceptance of
labor services
Merchandise purchase and acceptance of labor services
Unit: RMB
Content of the This Period's Previous Period's
Approved transaction Over the transaction
Related parties related - party Amount of Amount of
limit limit or not
transaction Occurrence Occurrence
Hangzhou First On-line
World Hotel Co., procurement of No 3,945,361.60
Ltd. hotel products
Hangzhou On-line
Songcheng Industry procurement of No 30,527,071.00
Co., Ltd hotel products
On-line
Longquan Mountain
procurement of No 423,998.00
Resort Co., Ltd.
hotel products
Beijing Beite
Delegation of the
Shengdi Technology
scenic spot-related 29,155,963.23 No 9,594,276.67
Development Co.,
projects
Ltd.
Delegated to
SABH's Big develop and
No 5,489,285.80
Adventure Inc. design the SOW
project
Shanghai World
Expo Dongdi
Cultural Brand usage fee 9,433,962.00 No 9,571,349.95
Development Co.,
Ltd.
Sales of merchandise and provision of services
Unit: RMB
Content of the related - party This Period's Amount of Previous Period's Amount of
Related parties
transaction Occurrence Occurrence
Hangzhou First World Hotel Co.,
Ticket sales 1,431,730.00 4,870,053.00
Ltd.
Hangzhou Songcheng Industry
Ticket sales 2,425,720.00 7,870,590.00
Co., Ltd
236
2020 Annual Report of Songcheng Performance Development Co., Ltd
Hangzhou First World Hotel Co.,
E-commerce handling fees 170,475.39
Ltd.
Hangzhou Songcheng Industry
E-commerce handling fees 83,981.38
Co., Ltd
Related-party transactions involving purchase and selling of merchandise and provision and acceptance of labor services
(1) The amount incurred in the previous period of related-party transactions with SABH's Big Adventure Inc., was USD 808,571,
which was RMB 5,489,285.8 after conversion at the exchange rate on the day of foreign exchange purchase.
(2) The subsidiary Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd, of the company, purchases hotel products from
associates. The net method of accounting is applied in accordance with the requirements of the new revenue standards.
(2) Related leasing
The company as the lessee:
Unit: RMB
Rental fee confirmed in the Rental fee confirmed in the
Name of Lessor Type of the leased assets
current period previous period
Office building at No. 148,
Hangzhou Songcheng Industry
Zhijiang Road (Area of 5,591.53 2,396,369.06 3,930,045.36
Co., Ltd
square meters)
Parking Lot at No. 148, Zhijiang
Hangzhou Songcheng Industry
Road (Area of 27,667 square 6,225,062.50 9,960,099.97
Co., Ltd
meters)
Operation of the scenic spot of
the American City teaching
Hangzhou Songcheng Industry
building at No. 148 Zhijiang 1,423,690.48 1,708,428.64
Co., Ltd
Road ( Area of 3,322 square
meters)
President Hill supporting
housing and dormitory rooms
Hangzhou Songcheng Industry
of Huamei apartment at No. 1,600,625.00 1,920,750.00
Co., Ltd
148, Zhijiang Road, (Area of
7,114 square meters)
American City parking lot at No.
Hangzhou Songcheng Industry
148, Zhijiang Road ( Area of 2,966,625.00 3,559,950.00
Co., Ltd
13,185 square meters)
Operation of scenic spots in
Hangzhou Songcheng Industry American City at No. 148,
1,656,428.58 1,987,714.38
Co., Ltd Zhijiang Road ( Area of 7,730
square meters)
Hangzhou First World Hotel Co., Office space of north building
472,500.00 756,000.00
Ltd. of the First World Hotel (Area
237
2020 Annual Report of Songcheng Performance Development Co., Ltd
of 3,000 square meters)
Parking lot at No. 92 Xianghu
Hangzhou World Leisure Expo
road (Area of 19,192 square 4,318,187.50 5,181,840.00
Park Co., Ltd
meters)
Staff dormitory of Water City of
Hangzhou World Leisure Expo Creative Park at No. 92 Xianghu
677,250.00 812,700.00
Park Co., Ltd Road (Area of 3,010 square
meters)
The European style and
international exhibition area of
Xi'an International Horticultural
Xi’an World Expo Park, at Shibo
Exposition Investment (Group) 1,444,954.14
Avenue, Chanba Ecological
Co., Ltd.
Zone, Xi’an City (Total area of
78,743.94 square meters)
Description of related-party leases
Due to the impact of the "COVID-19", the lessors Hangzhou Songcheng Industrial Co., Ltd., Hangzhou First World Hotel Co., Ltd.
and Hangzhou World Leisure Expo Park Co., Ltd. agreed to exempt the company from rental fee of 4.5 months during the closed
period due to the epidemic.
(3) Remuneration for key management personnel
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Salary of key management personnel 380.85 357.60
(4) Other related-party transactions
In September 2019, Songcheng Holdings (Thailand) Co., Ltd., a wholly-owned subsidiary of the company, and its related party
Qiyun Holding (Thailand) Co., Ltd. co-invested in Songcheng (Pattaya) International Culture Co., Ltd., which had registered capital of
THB 5 million. The two parties subscribed THB 3.25 million and THB 750,000 with subscription ratios of 65.00% and 15.00%
respectively. As of December 31, 2020, the company and its affiliates have not yet completed capital contributions.
6. Receivables and payables of the related parties
(1) Receivables
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Item Name Related parties
Book balance Bad debt provision Book balance Bad debt provision
Prepayments
238
2020 Annual Report of Songcheng Performance Development Co., Ltd
Hangzhou World
Leisure Expo Park 2,997,262.50 1,998,125.01
Co., Ltd
Hangzhou First
283,500.00 700,000.00
World Hotel Co., Ltd.
Other Receivables
Shanghai World
Expo Dongdi Cultural
10,000,000.00 200,000.00 10,000,000.00 200,000.00
Development Co.,
Ltd.
(2) Payables
Unit: RMB
Item Name Related parties Closing balance Opening balance
Accounts Payable
Beijing Beite Shengdi
Technology Development Co., 3,797,469.47 8,238,229.47
Ltd.
Other Payables
SABH's Big Adventure Inc. 7,477,572.29
Xi'an International Horticultural
Exposition Investment (Group) 355,000.00
Co., Ltd.
Guangzhou Gening Green
2,531,680.00
Engineering Co., Ltd.
Zhongshan Dehua Green
686,011.00
Engineering Co., Ltd.
Other notes: The balance of other payables of SABH's Big Adventure Inc. at the end of the period was USD 1,146,005.53, which was
converted into RMB 7,477,572.29 at the exchange rate on the balance sheet date.
XIII. Share-based payment
1. Overview of share-based payment
□ Applicable √ Not applicable
2. Situation of equity-settled share-based payment
□ Applicable √ Not applicable
239
2020 Annual Report of Songcheng Performance Development Co., Ltd
3. Situation of cash-settled share-based payment
□ Applicable √ Not applicable
4. Modification and termination of share-based payment
N/A
XIV. Commitments and contingencies
（一） Important Commitment
1. Important commitments on the Balance Sheet date
On June 21, 2019, the 32nd Meeting of the Sixth Board of Directors of the company reviewed and approved the "Proposal on
Using Idle Self-owned Funds to Invest in Securities and Wealth Management Products". It agreed that the company may use idle
self-owned funds to invest in securities and financial products, so as to maintain and increase the value of idle funds on the bas is of
ensuring safety and liquidity, provided that the capital i s secured, the operation is legal and compliant, normal production and
operation are not affected. The amount should not exceed RMB 2 billion. The funds within this limit can be used on a rolling basis.
The use period is valid within 2 years from the date approved by Board of Directors. The management of the company is authorized
to exercise the right to make investment decisions and sign relevant legal documents within the limit.
2、 Commitment in operating lease
According to irrevocable operating lease contract that has been signed, the minimum lease payments that the company should
pay after the balance sheet date are as follows:
Remaining lease term Minimum lease payment
Within 1 year 39,527,812.50
1 to 2 years 12,683,050.00
2 to 3 years 6,066,000.00
3 years or above 92,581,967.00
Total 150,858,829.50
3. Contingencies
(1) Important contingent matters on the balance sheet day
The company has no important contingencies that need to be disclosed.
(2) If no important contingent matter to be disclosed by the Company, it should also be noted accordingly
No important contingent matter needs to be disclosed by the Company.
240
2020 Annual Report of Songcheng Performance Development Co., Ltd
XV. Events after the Balance Sheet Date
1. Distribution of profits
Unit: RMB
Profits or dividends to be distributed 130,734,702.00
Profits or dividends reviewed and approved for releasing 130,734,702.00
2. Description of other matters after the balance sheet date
(I) Distribution of profits
According to the 2020 Annual Profit Distribution Plan adopted at the 10th Meeting of the Seventh Board of Directors of the
company held on April 22, 2021, the company plans to distribute RMB 0.50 dividend (Including tax) in cash for every 10 shares to all
shareholders based on the total share capital of 2,614,694,040 shares at the end of 2020. Total cash dividend of RMB 130,734, 702
was distributed.
(2) Transfer of post-period equity
1. On March 18, 2021, Songcheng Technology Development Co., Ltd., a subsidi ary of the company, signed "Equity Transfer
Agreement" with 5 natural persons including Wen Qinglin. 20% of the equity of the target company Beijing Bette Technology
Development Co., Ltd. held by Songcheng Technology Development Co., Ltd. was transferred to 5 natural persons including Wen
Qinglin. The transfer consideration of the equity transferred was the amount of RMB 30 million capital increase invested by
Songcheng Technology Development Co., Ltd and corresponding investment income calculated at 10% an nual simple interest during
the actual investment period. The transfer consideration is paid in three installments: 60% of the total capital increase (RMB 18
million) plus corresponding investment income shall be paid no later than Sept. 30, 2021 (includin g this date); 20% of the total
capital increase (RMB 6 million) plus corresponding investment income shall be paid no later than Mar 31, 2022 (including thi s date);
20% of the total capital increase (RMB 6 million) plus corresponding investment income shal l be paid no later than Sept. 30, 2022
(including this date); The target company Beijing Bette Technology Development Co., Ltd.. provides joint liability guarantee for all
the obligations of other 5 natural persons (including Wen Qinglin) under this agreement. The guarantee period is three years from
the expiration date of the contract performance period. Within ten working days after receiving all the remaining transfer
consideration, Songcheng Technology Development Co., Ltd. shall cooperate with the target company to complete the signing of the
industrial and commercial change documents required for the equity transfer. The personnel appointed by Songcheng Technology
Development Co.; Ltd. shall no longer serve as the director of the target company.
2. On April 7, 2021, the company and Longquan Tourism Investment Development Co., Ltd. signed "Equity Transfer Contract"
regarding the equity and debts of Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd., a wholly -owned
subsidiary of the company. The subject matter of the transfer was 100% equity of Zhejiang Songcheng Longquan Mountain Tourism
Development Co., Ltd. held by the company and all debts incurred prior to the closing of equity. The transaction consideratio n was
RMB 109,199,300 at the transaction price for 100% of the equity and RMB 166,800,700 at the liquidation for all debts incurred prior
to the closing of equity. The total transaction price was RMB 27,600 ten thousand. The payment method is to pay 50% of the
transaction consideration within 40 days after this contract signed, and the remaining 50% of the transaction consideration within
15 days after completion of the industrial and commercial change registration.
241
2020 Annual Report of Songcheng Performance Development Co., Ltd
XVI. Other Significant Events
(I) Subsection information
1. Basis for determining report segment and accounting policies
The company determines the operating segment based on the internal organizational structure, management requirements,
and internal reporting system and then determines the reporting segment based on operating segment.
Operating segment refers to the component within the company that meets the following conditions at the same time: (1) The
component can generate income and expenses in daily activities; (2) The management of the company can regularly evaluate the
operating results of such component so as to determine the allocation of resources to it and evaluate its performance; (3) Th e
company can obtain the accounting information of the component, such as the financial status, operating results and cash fl ow
etc.,.
The company reporting segment includes:
(1) Live performance: refers to all on-site scenic spots and theater businesses as the reporting segment, including Songcheng
Scenic Area, Crazy Apple Land Scenic Area, Hangzhou Paradise Scenic Area, Sanya Romance Park, Lijiang Romance Park, Jiuzhai
Romance Park, Tibetan Mystery Theater, Guilin Romance Park, Zhangjiajie Romance Park, Xi'an Romance Park;
(2) Tourism service industry: refers to the reporting segment of e-commerce, design and planning as well as the transportation
services for scenic spots.
2. Financial information of the reporting segment
Unit: RMB
Tourism service
Item Live performance Subtotal Inter-segment offset Total
industry
The revenue from
636,915,514.47 223,223,920.66 860,139,435.13 30,000.00 860,109,435.13
main business
Main business cost 341,881,694.34 9,028,354.80 350,910,049.14 848,654.60 350,061,394.54
Total assets 8,484,420,643.64 2,147,816,257.40 10,632,236,901.04 1,436,894,069.98 9,195,342,831.06
Total amount of
2,292,248,984.48 564,197,439.88 2,856,446,424.36 1,396,363,757.08 1,460,082,667.28
liabilities
XVII. Notes to Main Items in the Financial Statements of the Parent Company
1. Accounts receivable
(1) Categorical disclosure of accounts receivable
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Category Book balance Bad debt provision Book Book balance Bad debt provision
Book value
Amount Percentage Amount Accrued value Amount Percentage Amount Accrued
242
2020 Annual Report of Songcheng Performance Development Co., Ltd
proportion proportion
Including:
Accounts receivables with
the bad debt provision
52,370.14 100.00% 14,145.24 27.01% 38,224.90 1,334,890.64 100.00% 65,055.55 4.87% 1,269,835.09
accrued based on
combinations
Including:
Combination of credit risk
38,179.30 72.90% 14,145.24 37.05% 24,034.06 1,334,890.64 100.00% 65,055.55 4.87% 1,269,835.09
characteristics by age
Consolidation scope and
accounts receivable from 14,190.84 27.10% 14,190.84
related parties
Total 52,370.14 100.00% 14,145.24 38,224.90 1,334,890.64 100.00% 65,055.55 1,269,835.09
Bad debt provision based on combinations
Unit: RMB
Balance at the End of the Period
Name
Book balance Bad debt provision Accrued proportion
Within credit period 680.50 20.42 3.00%
Credit period overdue within 1
27,498.80 4,124.82 15.00%
year
Credit period overdue within 1
25.00%
to 2 years
Credit period overdue within 2
45.00%
to 3 years
Credit period overdue within 3
60.00%
to 4 years
Credit period overdue within 4
80.00%
to 5 years
Credit period overdue for more
10,000.00 10,000.00 100.00%
than 5 years
Total 38,179.30 14,145.24 --
Please refer to the disclosing methods of other receivables for the information disclosure of bad debts provisions, if the bad debt
provisions of accounts receivable are made according to the general model of expected credit losses:
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging Book balance
Within 1 year 42,370.14
243
2020 Annual Report of Songcheng Performance Development Co., Ltd
2 to 3 years
3 to 4 years
4 to 5 years
5 years or above 10,000.00
Total 52,370.14
(2) Provision for bad debts accrued, recovered or reversed in this period
Provision for bad debts in the current period:
Unit: RMB
Balance at the Amount of Changes in the Current Period
Balance at the
Category Start of the Recovered or
Accrued Written Off Others End of the Period
Period Reversed
Provision for bad
debts of accounts 65,055.55 -30,361.98 20,548.33 14,145.24
receivable
Total 65,055.55 -30,361.98 20,548.33 14,145.24
(3) Accounts receivable of the top five balances at the end of the period collected by the arrears
There are no accounts receivable actually written off in the current period.
(4) Accounts receivable of the top five closing balances collected by debtors
Unit: RMB
Proportion of the total
Accounts receivable at the end Bad debt provision at the end
Name of Unit accounts receivable at the end
of the period of the period
pf the period
Xi'an Romance Performance
14,190.84 27.10%
Development Co., Ltd
Henan Longgui Cultural Tourism
28,179.30 53.81% 4,145.24
Development Co., Ltd.
He Xiaojuan 10,000.00 19.09% 10,000.00
Total 52,370.14 100.00%
2. Other receivables
Unit: RMB
Item Balance at the End of the Period Balance at the Start of the Period
244
2020 Annual Report of Songcheng Performance Development Co., Ltd
Interest Receivable
Dividends Receivable
Other Receivables 1,046,160,763.74 1,100,294,815.74
Total 1,046,160,763.74 1,100,294,815.74
(1) Other Receivables
1) Other receivables categorized by the nature of the funds
Unit: RMB
Nature of the funds Closing balance Opening balance
Employee loan 1,378,749.73 1,034,409.72
Incomings and outgoings 1,050,000.00 1,116,484.00
Security deposit, deposit 349,030.00
Internal current account within the scope
1,025,718,037.61 1,046,857,927.16
of consolidation
Equity transfer fund 79,866,980.26 79,866,980.26
Others 458,024.14 909,480.58
Total 1,108,471,791.74 1,130,134,311.72
2) Bad debt provision
Unit: RMB
Phase One Phase Two Phase Three
Expected credit losses for
Expected credit Expected credit losses for
Bad debt provision the entire extension Total
losses in the next 12 the entire extension (with
(without credit
months credit impairment)
impairment)
Balance on January 1,
35,390.52 29,804,105.46 29,839,495.98
2020
Balance of the current
period on January 1, —— —— —— ——
2020
Provisions of this period 7,123.90 32,550,115.00 32,557,238.90
Other variations -24,146.68 -61,560.20 -85,706.88
Balance on December
18,367.74 62,292,660.26 62,311,028.00
31, 2020
Book balance changes with significant changes in loss provision in the current period
245
2020 Annual Report of Songcheng Performance Development Co., Ltd
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging Book balance
Within 1 year (including 1 year) 1,027,351,939.02
1 to 2 years 42,872.46
2 to 3 years 100,000.00
3 to 4 years 79,866,980.26
4 to 5 years 60,000.00
5 to 6 years 1,050,000.00
Total 1,108,471,791.74
3) Provision for bad debts accrued, recovered or reversed in this period
Provision for bad debts in the current period:
Unit: RMB
Balance at Amount of Changes in the Current Period
Balance at the End
Category the Start of Recovered or
Accrued Written Off Others of the Period
the Period Reversed
Provision for bad
29,839,495.9
debts of other 32,557,238.90 85,706.88 62,311,028.00
8
receivables
29,839,495.9
Total 32,557,238.90 85,706.88 62,311,028.00
8
4) Accounts receivable actually written off in this period
There are no actual written-off accounts receivable in this period.
5) Other receivables of the top five closing balances collected by debtors
Unit: RMB
As a percentage of
Balance at the End total other Bad debt provision at
Name of Unit Nature of the funds Aging
of the Period receivables at the the end of the period
end of the period
Zhangjiajie Romance Consolidation of
Performance internal current 436,601,809.00 Within 1 year 39.39%
Development Co., Ltd account
246
2020 Annual Report of Songcheng Performance Development Co., Ltd
Shanghai Songcheng
Consolidation of
World Expo
internal current 226,400,000.00 Within 1 year 20.42%
Performance
account
Development Co., Ltd
Zhejiang Songcheng
Consolidation of
Xitang Performance
internal current 158,083,003.64 Within 1 year 14.26%
Valley Performance
account
Development Co., Ltd
Zhejiang Songcheng
Consolidation of
Longquan Mountain
internal current 146,490,000.00 Within 1 year 13.22%
Tourism Development
account
Co., Ltd
An Xiaofen (formerly:
Horgos Dasheng
Equity transfer fund 79,866,980.26 3-4 years 7.21% 61,242,660.26
Legend Venture
Capital Co., Ltd.)
Total -- 1,047,441,792.90 -- 94.50% 61,242,660.26
3. Long-term equity investment
Unit: RMB
Balance at the End of the Period Balance at the Start of the Period
Item Provision for Provision for
Book balance Book value Book balance Book value
decline in value decline in value
Investment in
4,940,162,163.79 4,940,162,163.79 3,563,757,019.35 3,563,757,019.35
subsidiaries
Investment in
affiliates and joint 3,307,758,983.34 1,814,682,876.81 1,493,076,106.53 3,378,092,795.14 3,378,092,795.14
ventures
Total 8,247,921,147.13 1,814,682,876.81 6,433,238,270.32 6,941,849,814.49 6,941,849,814.49
(1) Investment in Subsidiaries
Unit: RMB
Decrease/Increase in the current period Closing
Balance at the Start Balance at the End balance of
Provision for
The invested entity of the Period (book Investments Investment of the Period (book provision
impairment Others
value) increased decreased value) for decline
accrued
in value
Hangzhou
3,100,000.00 3,100,000.00
Songcheng Art
247
2020 Annual Report of Songcheng Performance Development Co., Ltd
Troupe Co., Ltd.
Hangzhou Paradise
368,458,844.16 269,943,679.30 638,402,523.46
Co., Ltd.
Sanya Romance
Tourism
490,000,000.00 490,000,000.00
Performance Co.,
Ltd.
Lijiang Chama
Ancient City
Tourism 250,000,000.00 250,000,000.00
Development Co.,
Ltd
Aba Zhou Jiuzhai
Romance Tourism
176,000,000.00 82,500,000.00 258,500,000.00
Development Co.,
Ltd
Hangzhou
Songcheng Tourism
10,000,000.00 10,000,000.00
Development Co.,
Ltd
Zhejiang Songcheng
Entertainment 50,000,000.00 50,000,000.00
Culture Co., Ltd.
Jiuzhaigou Tibetan
Mystery Culture 87,000,000.00 87,000,000.00
Co., Ltd
Zhejiang Songcheng
Longquan Mountain
Tourism 120,000,000.00 120,000,000.00
Development Co.,
Ltd
Hangzhou
Songcheng
Technology 39,530,000.00 39,530,000.00
Development Co.,
Ltd.
Songcheng
Performance
International 606,367,375.19 606,367,375.19
Development Co.,
Ltd.
248
2020 Annual Report of Songcheng Performance Development Co., Ltd
Shanghai
Songcheng World
Expo Performance 132,000,000.00 132,000,000.00
Development Co.,
Ltd
Songcheng
Performance
500,000.00 500,000.00
Development
(Shanghai) Co., Ltd.
Guilin Lijiang
Romance
Performance 455,000,000.00 455,000,000.00
Development Co.,
Ltd
Zhangjiajie
Romance
Performance 120,000,000.00 120,000,000.00
Development Co.,
Ltd
Songcheng
Performance
500,000.00 500,000.00
Management Co.,
Ltd.
Songcheng
Dumuqiao Network 4,000,000.00 4,000,000.00
Co., Ltd.
Xi'an Romance
Performance
100,000,000.00 185,000,000.00 285,000,000.00
Development Co.,
Ltd
Zhejiang Songcheng
Xitang Performance
Valley Performance 100,000,000.00 100,000,000.00
Development Co.,
Ltd
Foshan South Sea
Qiao Mountain
Cultural Tourism 448,950,800.00 448,950,800.00
Development Co.,
Ltd
Hangzhou Songguo 2,350,000.00 2,350,000.00
249
2020 Annual Report of Songcheng Performance Development Co., Ltd
Cultural Creative
Co., Ltd.
Zhuhai Southern
Film and Television
378,000,000.00 371,297,581.07 6,702,418.93
Cultural Industry
Co., Ltd.
Zhuhai Songcheng
Performance 396,297,581.07 396,297,581.07
Kingdom Co., Ltd
Hangzhou
Songcheng
performance Valley
technology and 489,061,465.14 489,061,465.14
Culture
Development Co.,
Ltd
Total 3,563,757,019.35 1,800,802,725.51 424,397,581.07 4,940,162,163.79
(2) Investment in affiliates and joint ventures
Unit: RMB
Decrease/Increase in the current period
Cash
Investme
divide Closing
Name Balance at nt profit Adjustmen Balance at
Investm Investm nds or balance of
of the Start of and loss t on other Other Provision for the End of
ents ent profit Othe provision for
Investe the Period recognize comprehe changes in impairment the Period
increase decreas declar rs decline in
es (book value) d under nsive equity accrued (book value)
d ed ed to value
the equity income
distrib
method
ute
Ⅰ. Joint ventures
Ⅱ. Affiliates
Beijing
Huafang
Technol
ogy Co.,
3,378,092,7 -2,969,19 -67,402,28 -1,814,682,8 1,493,076,1 1,814,682,8
Ltd. 37,670.53
95.14 5.48 6.85 76.81 06.53 76.81
(formerl
y
known
as
250
2020 Annual Report of Songcheng Performance Development Co., Ltd
Beijing
Six
Rooms
Technol
ogy Co.,
Ltd.)
Subtota 3,378,092,7 -2,969,19 -67,402,28 -1,814,682,8 1,493,076,1 1,814,682,8
37,670.53
l 95.14 5.48 6.85 76.81 06.53 76.81
3,378,092,7 -2,969,19 -67,402,28 -1,814,682,8 1,493,076,1 1,814,682,8
Total 37,670.53
95.14 5.48 6.85 76.81 06.53 76.81
4. Operating income and operating costs
Unit: RMB
This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Item
Income Cost Income Cost
Main Business 15,832,779.35 19,532,790.64 733,342,510.96 389,275,037.47
Other businesses 7,059,972.03 59,192,952.96
Total 22,892,751.38 19,532,790.64 792,535,463.92 389,275,037.47
Related information of revenue:
Unit: RMB
Culture and art
Contract
Segment 1 Segment 2 industry-live Other businesses Total
classification
performance
Product types 15,832,779.35 7,059,972.03 22,892,751.38
Including:
(1) Income from
Hangzhou
15,832,779.35 15,832,779.35
Songcheng tourist
area
(2) Other businesses 7,059,972.03 7,059,972.03
Contract type 15,832,779.35 7,059,972.03 22,892,751.38
(1) Revenue from
15,832,779.35 5,359,934.07 21,192,713.42
contract
Including:
Confirm at time
15,832,779.35 5,150,736.86 20,983,516.21
points
Confirm within a
209,197.21 209,197.21
certain period of
251
2020 Annual Report of Songcheng Performance Development Co., Ltd
time
(2) Income from the
rental of scenic 1,700,037.96 1,700,037.96
spots
Information related to performance obligations:
N/A
Information related to the transaction price allocated to the remaining obligations:
At the end of this report, the amount of income corresponding to the obligations under the contract that have been signed but have
not been performed or have not been completely performed is RMB 0.00, in which, RMB 0.00 is expected to be included in income
in Year 0.
5. Investment income
Unit: RMB
Item This Period's Amount of Occurrence Previous Period's Amount of Occurrence
Long-term equity investment income
432,000,000.00 618,000,000.00
calculated by cost method
Long-term equity investment income
-2,931,524.95 110,867,013.28
measured by equity method
Investment income from disposal of
-6,520,482.12 560,910.55
long-term equity investment
Investment income from disposal of trading
2,412,380.45 15,755,921.52
financial assets
Gains resulting from loss of control due to
capital increase by minority shareholders 499,652,459.43
from the invested entities
Total 424,960,373.38 1,244,836,304.78
XVIII. Supplementary Information
1. Breakdown of non-recurring gains and losses for this period
√ Applicable □ Not applicable
Unit: RMB
Item Amount Note
Gains and losses from disposal of
-37,625,882.13
non-current assets
The government subsidies included in the
current profits and losses (excluding the 35,618,594.19
government subsidies closely related to
252
2020 Annual Report of Songcheng Performance Development Co., Ltd
regular businesses of the Company and
issued in the quota or quantity based on the
national standards)
Profits and losses resulting from the changes
in fair value for holding trading financial
assets, derivative financial assets and
trading financial liabilities, derivative
financial liabilities and investment income
from disposal of trading financial assets,
19,619,586.83
derivative financial assets, trading financial
liabilities, derivative financial liabilities, and
other obligatory right investment, excluding
the effective hedging businesses related to
the regular business operation of the
Company
Non-Operating Revenue and expenses other
-509,618.20
than the above
Less: Impact of income tax 2,230,795.39
Impact of minority equity -591,743.78
Total 15,463,629.08 --
For items defined as non-recurring gains and losses according to the No. 1 Explanatory Announcement on Information Disclosure
for Companies Offering Their Securities to Public - Non-recurring Gains and Losses, or non-recurring gains and losses items listed in
the said document defined as recurring ones, please specify the reasons.
□ Applicable √ Not applicable
2. Return on net assets and earnings per share
Earnings per share
Profit for the reporting period Weighted Average ROE Basic Earnings per Share Diluted Earnings per
(RMB/Share) Share (RMB/Share)
Net profit attributable to common
-20.50% -0.6702 -0.6702
shareholders of the Company
Net profit attributable to common
shareholders of the Company after
-20.68% -0.6761 -0.6761
deducting non-recurring gains and
losses
253
2020 Annual Report of Songcheng Performance Development Co., Ltd
Section XIII Documents Available for Reference
I. The financial statements signed and sealed by the legal representative, the chief accountant and the person in charge of
accounting institution (Accounting Officer) of the Company.
II. The original copy of the Audit Report with the seal of the Accounting Firm and signed and stamped by Certified Public
Accountants.
III. Originals of all the Company's documents and announcements published on the website designated by China Securities
Regulatory Commission during the reporting period.
IV. Original of 2020 Annual Report signed by the legal representative of the Company.
V. Other related information.
The said documents are prepared and placed at the Company's Securities Investment Department
Songcheng Performance Development Co., Ltd
Chairman: Huang Qiaoling
April 23, 2021
Note:
This document is a translated version of the Chinese version 2020 Annual Report ( “2020 年年度报告”), and the published annual
report in the Chinese version shall prevail. The complete published Chinese 2020 Annual Report may be obtained at
www.cninfo.com.cn.
254
