WEIFU HIGH-TECHNOLOGY GROUP CO., LTD.
Semi-Annual Financial Reprot 2023
(Unaudited)
August 2023
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
I. Audit report
Whether the semi annual report is audited or not
□Yes No
The company's semi annual financial report has not been audited
II. Financial Statement
Statement in Financial Notes are carried in RMB/CNY
1. Consolidated Balance Sheet
Prepared by Weifu High-Technology Group Co., Ltd.
June 30, 2023
In RMB
Item June 30, 2023 January 1, 2023
Current assets:
Monetary funds 2,487,786,142.04 2,389,551,930.76
Settlement provisions
Capital lent
Trading financial assets 2,250,198,464.28 2,718,820,654.87
Derivative financial assets
Note receivable 104,980,712.30 135,559,024.27
Account receivable 3,317,387,077.56 3,127,490,177.25
Receivable financing 1,920,348,206.04 1,918,368,845.21
Prepayments 67,710,664.23 94,323,853.87
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance receivable
Other account receivable 2,874,547,071.97 1,264,507,456.47
Including: Interest receivable
Dividend receivable 1,955,605,474.71 147,000,000.00
Buying back the sale of financial assets
Inventory 1,921,084,065.82 2,283,119,656.27
Contract assets
Assets held for sale
Non-current asset due within 1 year
Other current assets 240,962,367.80 430,547,201.24
Total current assets 15,185,004,772.04 14,362,288,800.21
Non-current assets:
2
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Loans and payments on behalf
Debt investment
Other debt investment
Long-term account receivable
Long-term equity investment 5,187,995,234.43 6,282,818,108.96
Other equity instrument investment 677,790,690.00 677,790,690.00
Other non-current financial assets 1,166,342,387.00 1,326,608,914.00
Investment real estate 56,185,135.36 49,296,869.73
Fixed assets 3,745,590,665.96 3,769,984,185.94
Construction in progress 639,963,756.99 509,105,587.49
Productive biological assets
Oil and gas assets
Right-of-use assets 39,364,840.80 41,865,100.38
Intangible assets 489,758,310.65 487,627,987.92
Expense on research and development
Goodwill 251,813,115.66 237,682,375.72
Long-term expenses to be apportioned 27,143,337.26 28,586,235.84
Deferred income tax assets 273,908,331.15 275,627,772.45
Other non-current assets 611,808,088.23 479,630,436.37
Total non-current assets 13,167,663,893.49 14,166,624,264.80
Total assets 28,352,668,665.53 28,528,913,065.01
Current liabilities:
Short-term loans 2,256,900,925.45 3,604,376,527.82
Loans from central bank
Capital borrowed
Trading financial liabilities
Derivative financial liabilities 737,424.50 747,115.75
Note payable 1,584,124,651.19 1,411,089,606.00
Account payable 3,271,926,231.00 3,454,601,023.60
Advance payment 462,221.88 3,633,878.33
Contractual liabilities 104,491,724.54 94,850,083.23
Selling financial asset of repurchase
Absorbing deposit and interbank deposit
Security trading of agency
Security sales of agency
Wage payable 225,684,651.78 317,434,386.24
Taxe payable 64,158,658.16 54,586,315.53
Other account payable 156,729,445.68 198,990,948.23
Including: Interest payable
Dividend payable 10,373,454.00
3
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Commission charge and commission payable
Reinsurance payable
Liabilities held for sale
Non-current liabilities due within 1 year 36,959,064.67 14,285,348.90
Other current liabilities 262,650,217.54 211,763,779.77
Total current liabilities 7,964,825,216.39 9,366,359,013.40
Non-current liabilities:
Insurance contract reserve
Long-term loans 600,000,000.00 238,000,000.00
Bond payable
Including: Preferred stock
Perpetual capital securities
Lease liabilities 30,799,799.49 31,589,277.20
Long-term account payable 30,785,082.11 30,785,082.11
Long-term wage payable 155,985,385.60 154,093,044.28
Accrual liabilities 9,980,678.92 10,106,268.87
Deferred income 199,209,771.05 223,123,978.78
Deferred income tax liabilities 39,772,528.51 40,149,550.99
Other non-current liabilities
Total non-current liabilities 1,066,533,245.68 727,847,202.23
Total liabilities 9,031,358,462.07 10,094,206,215.63
Owner’s equity:
Share capital 1,002,579,793.00 1,008,603,293.00
Other equity instrument
Including: Preferred stock
Perpetual capital securities
Capital reserve 3,335,177,095.84 3,398,368,567.63
Less: Inventory shares 538,410,272.24 541,623,002.63
Other comprehensive income 60,328,251.06 -911,310.13
Reasonable reserve 3,583,407.75 2,119,800.95
Surplus reserve 510,100,496.00 510,100,496.00
Provision of general risk
Retained profit 14,171,024,206.15 13,320,021,325.90
Total owner’ s equity attributable to parent company 18,544,382,977.56 17,696,679,170.72
Minority interests 776,927,225.90 738,027,678.66
Total owner’ s equity 19,321,310,203.46 18,434,706,849.38
Total liabilities and owner’ s equity 28,352,668,665.53 28,528,913,065.01
Legal Representative: Wang Xiaodong
Person in charge of accounting works: Rong Bin
Person in charge of accounting institute: Wu Junfei
4
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2. Balance sheet of parent company
In RMB
Item June 30, 2023 January 1, 2023
Current assets:
Monetary funds 658,847,374.34 823,574,329.53
Trading financial assets 2,134,459,399.76 2,693,150,975.20
Derivative financial assets
Note receivable 38,585,991.52 29,575,852.04
Account receivable 1,106,215,964.34 906,808,283.22
Receivable financing 231,837,502.28 216,462,262.44
Prepayments 38,880,788.18 56,037,892.68
Other account receivable 3,206,692,791.69 1,472,102,439.27
Including: Interest receivable 32,195,758.91 206,325.34
Dividend receivable 1,881,769,939.06
Inventories 554,131,949.66 571,571,431.95
Contract assets
Assets held for sale
Non-current assets maturing within 1 year
Other current assets 1,755,265.16 107,462,112.82
Total current assets 7,971,407,026.93 6,876,745,579.15
Non-current assets:
Debt investment
Other debt investment
Long-term account receivable
Long-term equity investment 7,290,721,357.80 8,369,843,351.10
Other equity instrument investment 601,850,690.00 601,850,690.00
Other non-current financial assets 1,166,342,387.00 1,326,608,914.00
Investment real estate 35,018,863.59 35,584,279.11
Fixed assets 2,232,822,699.74 2,251,495,050.80
Construction in progress 344,391,742.48 251,304,655.41
Productive biological assets
Oil and natural gas assets
Right-of-use assets 4,321,883.64 6,061,693.75
Intangible assets 211,423,280.19 209,246,490.17
Research and development costs
Goodwill
Long-term deferred expenses 6,417,238.81 6,895,352.43
Deferred income tax assets 88,907,446.28 109,624,761.50
Other non-current assets 222,124,598.31 168,744,695.04
Total non-current assets 12,204,342,187.84 13,337,259,933.31
5
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Total assets 20,175,749,214.77 20,214,005,512.46
Current liabilities
Short-term loans 1,461,515,277.78 2,121,354,415.53
Trading financial liabilities
Derivative financial liabilities 737,424.50 737,424.50
Note payable 332,041,918.11 251,867,652.05
Account payable 1,103,757,868.99 1,048,268,519.52
Advance payment
Contract liabilities 8,032,872.19 6,564,332.93
Wage payable 106,415,365.78 166,314,985.33
Taxe payable 16,561,316.90 6,048,505.30
Other account payable 431,093,918.61 926,276,130.15
Including: Interest payable 1,369,121.16 835,069.83
Dividend payable 10,373,454.00
Liabilities held for sale
Non-current liabilities due within 1 year 28,238,743.21 4,306,935.71
Other current liabilities 85,179,531.11 102,322,311.03
Total current liabilities 3,573,574,237.18 4,634,061,212.05
Non-current liabilities:
Long-term loans 400,000,000.00
Bond payable
Including: preferred stock
Perpetual capital securities
Lease liabilities 3,044,575.55 2,690,812.43
Long-term account payable
Long term employee compensation payable 121,683,760.89 121,683,760.89
Accrued liabilities 13,750.00
Deferred income 169,822,415.83 198,149,511.20
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 694,550,752.27 322,537,834.52
Total liabilities 4,268,124,989.45 4,956,599,046.57
Owners’ equity:
Share capital 1,002,579,793.00 1,008,603,293.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital reserve 3,451,969,145.81 3,515,005,861.23
Less: Inventory shares 538,410,272.24 541,623,002.63
Other comprehensive income
6
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Special reserve
Surplus reserve 510,100,496.00 510,100,496.00
Retained profit 11,481,385,062.75 10,765,319,818.29
Total owner’s equity 15,907,624,225.32 15,257,406,465.89
Total liabilities and owner’s equity 20,175,749,214.77 20,214,005,512.46
1. Consolidated profit statement
In RMB
Item 2023 semi-annual 2022 semi-annual
I. Total operating income 6,129,649,047.40 7,137,172,857.97
Including: Operating income 6,129,649,047.40 7,137,172,857.97
Interest income
Insurance gained
Commission charge and commission income
II. Total operating cost 5,988,688,585.81 6,730,969,892.10
Including: Operating cost 5,163,871,731.26 6,026,454,182.03
Interest expense
Commission charge and commission expense
Cash surrender value
Net amount of expense of compensation
Net amount of withdrawal of insurance contract reserve
Bonus expense of guarantee slip
Reinsurance expense
Tax and extra 32,240,422.99 28,877,421.78
Sales expense 103,031,481.40 79,020,592.43
Administrative expense 299,195,729.59 277,212,254.79
R&D expense 351,887,038.12 289,631,376.50
Financial expense 38,462,182.45 29,774,064.57
Including: Interest expenses 65,616,425.64 34,275,262.65
Interest income 15,706,416.56 13,927,929.36
Add: other income 40,979,593.51 26,095,621.93
Investment income (Loss is listed with “-”) 811,406,633.49 928,792,343.97
Including: Investment income on affiliated company and joint
742,783,514.37 823,400,731.10
venture
The termination of income recognition for financial assets
-680,357.44
measured by amortized cost
Exchange income (Loss is listed with “-”)
Net exposure hedging income (Loss is listed with “-”)
Income from change of fair value (Loss is listed with “-”) -18,069,553.29 -74,432,928.14
Loss of credit impairment (Loss is listed with “-”) -846,725.76 2,083,427.81
Loss of devaluation of asset (Loss is listed with “-”) -90,263,537.00 -104,219,783.98
Income from assets disposal (Loss is listed with “-”) 125,530,905.04 1,890,279.95
7
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
III. Operating profit (Loss is listed with “-”) 1,009,697,777.58 1,186,411,927.41
Add: Non-operating income 2,707,696.00 218,285.29
Less: Non-operating expense 758,381.69 2,196,565.87
IV. Total profit (Loss is listed with “-”) 1,011,647,091.89 1,184,433,646.83
Less: Income tax expense 29,332,279.74 55,645,075.75
V. Net profit (Net loss is listed with “-”) 982,314,812.15 1,128,788,571.08
(i) Classify by business continuity
1. Continuous operating net profit (net loss listed with “-”) 982,314,812.15 1,128,788,571.08
2. Termination of net profit (net loss listed with “-”)
(ii) Classify by ownership
1. Net profit attributable to owner’s of parent company 948,760,859.55 1,091,126,480.08
2. Minority shareholders’ gains and losses 33,553,952.60 37,662,091.00
VI. Net after-tax of other comprehensive income 61,239,561.19 -12,679,652.16
Net after-tax of other comprehensive income attributable to owners of
61,239,561.19 -12,679,652.16
parent company
(i) Other comprehensive income items which will not be reclassified
-305,484.37
subsequently to profit of loss
1. Changes of the defined benefit plans that re-measured -305,484.37
2. Other comprehensive income under equity method that cannot be
transfer to gain/loss
3. Change of fair value of other equity instrument investment
4. Fair value change of enterprise's credit risk
5. Other
(ii) Other comprehensive income items which will be reclassified
61,545,045.56 -12,679,652.16
subsequently to profit or loss
1. Other comprehensive income under equity method that can transfer
to gain/loss
2. Change of fair value of other debt investment
3. Amount of financial assets re-classify to other comprehensive
income
4. Credit impairment provision for other debt investment
5. Cash flow hedging reserve
6. Translation differences arising on translation of foreign currency
61,545,045.56 -12,679,652.16
financial statements
7. Other
Net after-tax of other comprehensive income attributable to minority
shareholders
VII. Total comprehensive income 1,043,554,373.34 1,116,108,918.92
Total comprehensive income attributable to owners of parent
1,010,000,420.74 1,078,446,827.92
Company
Total comprehensive income attributable to minority shareholders 33,553,952.60 37,662,091.00
VIII. Earnings per share:
(i) Basic earnings per share 0.98 1.10
(ii) Diluted earnings per share 0.98 1.10
Legal Representative: Wang Xiaodong
Person in charge of accounting works: Rong Bin
Person in charge of accounting institute: Wu Junfei
8
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2. Profit statement of parent company
In RMB
Item 2023 semi-annual 2022 semi-annual
I. Operating income 1,999,983,446.71 2,411,189,208.04
Less: Operating cost 1,582,800,180.15 1,919,986,159.54
Taxes and surcharge 12,898,023.37 13,501,778.32
Sales expenses 14,804,263.68 14,392,542.42
Administration expenses 151,432,225.43 144,366,869.06
R&D expenses 121,018,486.34 115,694,064.37
Financial expenses -30,173,931.83 -8,310,144.29
Including: interest expenses 46,417,119.10 18,380,946.47
Interest income 71,778,851.32 31,657,392.66
Add: other income 29,302,719.53 15,713,320.73
Investment income (Loss is listed with “-”) 711,673,709.71 835,209,662.03
Including: Investment income on affiliated Company and joint
644,975,916.19 734,429,287.99
venture
The termination of income recognition for financial assets
measured by amortized cost (Loss is listed with “-”)
Net exposure hedging income (Loss is listed with “-”)
Changing income of fair value (Loss is listed with “-”) -18,284,414.84 -74,417,034.85
Loss of credit impairment (Loss is listed with “-”) -782,758.06 477,241.11
Losses of devaluation of asset (Loss is listed with “-”) -37,325,504.75 -45,999,971.02
Income on disposal of assets (Loss is listed with “-”) 3,183,872.63 146,113.46
II. Operating profit (Loss is listed with “-”) 834,971,823.79 942,687,270.08
Add: Non-operating income 20,798.16 138,467.56
Less: Non-operating expense 452,082.96 613,619.53
III. Total Profit (Loss is listed with “-”) 834,540,538.99 942,212,118.11
Less: Income tax 20,717,315.23 33,033,489.65
IV. Net profit (Net loss is listed with “-”) 813,823,223.76 909,178,628.46
(i) continuous operating net profit (net loss listed with ‘-”) 813,823,223.76 909,178,628.46
(ii) termination of net profit (net loss listed with ‘-”)
V. Net after-tax of other comprehensive income
(I) Other comprehensive income items which will not be reclassified
subsequently to profit of loss
1. Changes of the defined benefit plans that re-measured
2. Other comprehensive income under equity method that cannot be
transfer to gain/loss
3. Change of fair value of other equity instrument investment
4. Fair value change of enterprise's credit risk
5. Other
(II) Other comprehensive income items which will be reclassified
subsequently to profit or loss
1. Other comprehensive income under equity method that can
transfer to gain/loss
9
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2. Change of fair value of other debt investment
3. Amount of financial assets re-classify to other comprehensive
income
4. Credit impairment provision for other debt investment
5. Cash flow hedging reserve
6. Translation differences arising on translation of foreign currency
financial statements
7. Other
VI. Total comprehensive income 813,823,223.76 909,178,628.46
VII. Earnings per share:
(i) Basic earnings per share
(ii) Diluted earnings per share
3. Consolidated cash flow statement
In RMB
Item 2023 semi-annual 2022 semi-annual
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing labor services 7,220,274,822.77 7,278,359,413.36
Net increase of customer deposit and interbank deposit
Net increase of loan from central bank
Net increase of capital borrowed from other financial institution
Cash received from original insurance contract fee
Net cash received from reinsurance business
Net increase of insured savings and investment
Cash received from interest, commission charge and commission
Net increase of capital borrowed
Net increase of returned business capital
Net cash received by agents in sale and purchase of securities
Write-back of tax received 290,682,518.69 232,035,625.20
Other cash received concerning operating activities 350,434,811.67 1,276,954,478.94
Subtotal of cash inflow arising from operating activities 7,861,392,153.13 8,787,349,517.50
Cash paid for purchasing commodities and receiving labor service 5,293,150,104.57 5,605,274,974.42
Net increase of customer loans and advances
Net increase of deposits in central bank and interbank
Cash paid for original insurance contract compensation
Net increase of capital lent
Cash paid for interest, commission charge and commission
Cash paid for bonus of guarantee slip
Cash paid to/for staff and workers 845,487,116.19 736,897,874.74
Taxe paid 223,362,710.57 223,299,890.76
Other cash paid concerning operating activities 409,430,984.38 4,715,858,822.47
10
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Subtotal of cash outflow arising from operating activities 6,771,430,915.71 11,281,331,562.39
Net cash flows arising from operating activities 1,089,961,237.42 -2,493,982,044.89
II. Cash flows arising from investing activities:
Cash received from recovering investment 1,792,373,483.22 6,783,202,982.62
Cash received from investment income 227,184,527.61 510,529,403.51
Net cash received from disposal of fixed, intangible and other long-
130,808,256.39 7,007,242.74
term assets
Net cash received from disposal of subsidiaries and other units
Other cash received concerning investing activities
Subtotal of cash inflow from investing activities 2,150,366,267.22 7,300,739,628.87
Cash paid for purchasing fixed, intangible and other long-term assets 521,593,700.42 622,264,336.12
Cash paid for investment 1,384,532,499.32 5,121,895,293.87
Net increase of mortgaged loans
Net cash received from subsidiaries and other units obtained
Other cash paid concerning investing activities
Subtotal of cash outflow from investing activities 1,906,126,199.74 5,744,159,629.99
Net cash flows arising from investing activities 244,240,067.48 1,556,579,998.88
III. Cash flows arising from financing activities
Cash received from absorbing investment
Including: Cash received from absorbing minority shareholders’
investment by subsidiaries
Cash received from loans 2,472,142,881.63 4,061,893,674.46
Other cash received concerning financing activities
Subtotal of cash inflow from financing activities 2,472,142,881.63 4,061,893,674.46
Cash paid for settling debts 3,430,505,040.97 1,122,521,453.43
Cash paid for dividend and profit distributing or interest paying 150,449,335.07 1,499,815,013.36
Including: Dividend and profit of minority shareholder paid by
25,671,100.00
subsidiaries
Other cash paid concerning financing activities 144,576,715.88 100,866,543.83
Subtotal of cash outflow from financing activities 3,725,531,091.92 2,723,203,010.62
Net cash flows arising from financing activities -1,253,388,210.29 1,338,690,663.84
IV. Influence on cash and cash equivalents due to fluctuation in exchange
29,533,974.54 -4,522,251.76
rate
V. Net increase of cash and cash equivalents 110,347,069.15 396,766,366.07
Add: Balance of cash and cash equivalents at the period -begin 2,277,117,604.82 1,094,018,936.73
VI. Balance of cash and cash equivalents at the period -end 2,387,464,673.97 1,490,785,302.80
4. Cash flow statement of parent company
In RMB
Item 2023 semi-annual 2022 semi-annual
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing labor services 1,931,059,388.32 2,206,683,069.38
Write-back of tax received 125,050,063.31 186,226,813.27
11
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Other cash received concerning operating activities 28,151,813.75 13,662,628.42
Subtotal of cash inflow arising from operating activities 2,084,261,265.38 2,406,572,511.07
Cash paid for purchasing commodities and receiving labor service 1,283,789,999.36 1,469,241,728.46
Cash paid to/for staff and workers 371,210,630.31 389,448,409.74
Taxes paid 76,834,144.17 138,600,504.19
Other cash paid concerning operating activities 85,355,061.82 94,078,994.56
Subtotal of cash outflow arising from operating activities 1,817,189,835.66 2,091,369,636.95
Net cash flows arising from operating activities 267,071,429.72 315,202,874.12
II. Cash flows arising from investing activities:
Cash received from recovering investment 1,285,673,483.22 4,401,242,982.62
Cash received from investment income 76,692,639.68 515,008,090.22
Net cash received from disposal of fixed, intangible and other long-
5,120,859.04 2,092,031.77
term assets
Net cash received from disposal of subsidiaries and other units
Other cash received concerning investing activities 266,890,277.63 333,677,757.87
Subtotal of cash inflow from investing activities 1,634,377,259.57 5,252,020,862.48
Cash paid for purchasing fixed, intangible and other long-term assets 312,219,496.56 427,352,475.87
Cash paid for investment 740,630,287.05 3,082,493,337.87
Net cash received from subsidiaries and other units obtained
Other cash paid concerning investing activities 54,000,000.00 3,408,840,000.00
Subtotal of cash outflow from investing activities 1,106,849,783.61 6,918,685,813.74
Net cash flows arising from investing activities 527,527,475.96 -1,666,664,951.26
III. Cash flows arising from financing activities
Cash received from absorbing investment
Cash received from loans 1,795,000,000.00 2,618,386,800.00
Other cash received concerning financing activities 15,000,000.00 783,729,243.68
Subtotal of cash inflow from financing activities 1,810,000,000.00 3,402,116,043.68
Cash paid for settling debts 2,026,644,800.00 326,483,000.00
Cash paid for dividend and profit distributing or interest paying 133,911,606.16 1,459,828,775.80
Other cash paid concerning financing activities 611,812,390.04 100,720,981.37
Subtotal of cash outflow from financing activities 2,772,368,796.20 1,887,032,757.17
Net cash flows arising from financing activities -962,368,796.20 1,515,083,286.51
IV. Influence on cash and cash equivalents due to fluctuation in exchange
3,103,799.68 -3,140,478.44
rate
V. Net increase of cash and cash equivalents -164,666,090.84 160,480,730.93
Add: Balance of cash and cash equivalents at the period-begin 803,410,185.18 488,417,498.83
VI. Balance of cash and cash equivalents at the period-end 638,744,094.34 648,898,229.76
12
5. Consolidated statement of change in owners’ equity
Current Period
In RMB
2023 semi-annual
Owners’ equity attributable to the parent company
Other
equity instrument
Item Perp Provision Minority Total owners’
Less: Other
Share etual Capital Reasonable Surplus of Retained interests equity
Prefe Inventory comprehens Other Subtotal
capital capit Othe reserve reserve reserve general profit
rred shares ive income
al r risk
stock
secur
ities
I. Balance at
1,008,603,2 3,398,368,5 541,623, 2,119,800.9 510,100,49 13,320,021,3 17,696,679,1 738,027,67 18,434,706,849.
the end of the -911,310.13
last year 93.00 67.63 002.63 5 6.00 25.90 70.72 8.66 38
Add: Changes
of accounting
policy
Error correction
of the last
period
Enterprise
combine under
the same
control
Other
II. Balance at
1,008,603,2 3,398,368,5 541,623, 2,119,800.9 510,100,49 13,320,021,3 17,696,679,1 738,027,67 18,434,706,849.
the beginning -911,310.13
of this year 93.00 67.63 002.63 5 6.00 25.90 70.72 8.66 38
III. Increase/
Decrease in - - -
61,239,561. 1,463,606.8 851,002,880. 847,703,806. 38,899,547.
reporting period 6,023,500.0 63,191,471. 3,212,73 886,603,354.08
(Decrease is 19 0 25 84 24
0 79 0.39
listed with “-”)
(i) Total
61,239,561. 948,760,859. 1,010,000,42 33,553,952. 1,043,554,373.3
comprehensive
income 19 55 0.74 60 4
(ii) Owners’ - - - -
devoted and 5,161,978.5
decreased 6,023,500.0 63,191,471. 3,212,73 66,002,241.4 -60,840,262.83
7
capital 0 79 0.39 0
1. Common
5,000,000.0
shares invested 5,000,000.00
by shareholders 0
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
5,361,906.6
owners equity 5,361,906.64 160,173.01 5,522,079.65
with share- 4
based payment
- - - -
4. Other 6,023,500.0 68,553,378. 3,212,73 71,364,148.0 1,805.56 -71,362,342.48
0 43 0.39 4
- -
(III) Profit
distribution 97,757,979.3 97,757,979.3 -97,757,979.30
0 0
1. Withdrawal
of surplus
reserves
2. Withdrawal
of general risk
provisions
3. Distribution - -
for owners (or 97,757,979.3 97,757,979.3 -97,757,979.30
shareholders) 0 0
4. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital
reserves
converted to
capital (share
capital)
2. Surplus
reserves
converted to
capital (share
capital)
3. Remedying
loss with
surplus reserve
14
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
4. Carry-over
retained
earnings from
the defined
benefit plans
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(V) Reasonable 1,463,606.8
reserve 1,463,606.80 183,616.07 1,647,222.87
0
1. Withdrawal
14,709,266. 14,709,266.9 1,646,999.8
in the reporting 16,356,266.75
period 91 1 4
2. Usage in the 13,245,660. 1,463,383.7
reporting period 13,245,660.11 14,709,043.88
11 7
(VI) Others
IV. Balance at
1,002,579,7 3,335,177,0 538,410, 60,328,251. 3,583,407.7 510,100,49 14,171,024,2 18,544,382,9 776,927,22 19,321,310,203.
the end of the
reporting period 93.00 95.84 272.24 06 5 6.00 06.15 77.56 5.90 46
15
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Last Period
In RMB
2022 semi-annual
Owners’ equity attributable to the parent company
Other
equity instrument
Item Share Perp Provision Minority Total owners’
Less: Other
capital etual Capital Reasonable Surplus of Retained interests equity
Prefe Inventory comprehens Other Subtotal
capit Othe reserve reserve reserve general profit
rred shares ive income
al r risk
stock
secur
ities
I. Balance at -
1,008,659, 3,371,344,1 270,249, 510,100,49 14,814,787,3 19,398,607,6 564,094,06 19,962,701,755.
the end of the 36,746,344. 712,215.31
last year 570.00 72.82 797.74 6.00 77.86 89.65 5.82 47
60
Add: Changes
of accounting
policy
Error
correction of
the last period
Enterprise
combine under
the same
control
Other
II. Balance at -
1,008,659, 3,371,344,1 270,249, 510,100,49 14,814,787,3 19,398,607,6 564,094,06 19,962,701,755.
the beginning 36,746,344. 712,215.31
of this year 570.00 72.82 797.74 6.00 77.86 89.65 5.82 47
60
III. Increase/
Decrease in - - -
reporting 34,733,141. 69,202,6 1,003,249.9 38,843,918.
period 12,679,652. 517,933,188. 564,079,107. -525,235,188.79
01 57.07 4 21
(Decrease is 16 72 00
listed with “-”)
(i) Total -
1,091,126,48 1,078,446,82 37,662,091. 1,116,108,918.9
comprehensive 12,679,652.
income 0.08 7.92 00 2
16
(ii) Owners’ -
devoted and 34,733,141. 69,202,6 1,086,139.9
decreased 34,469,516.0 -33,383,376.14
01 57.07 2
capital 6
16
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
1.Common
shares invested
by
shareholders
2. Capital
invested by
holders of
other equity
instruments
3. Amount
reckoned into
34,733,141. 34,733,141.0 1,086,139.9
owners equity 35,819,280.93
with share- 01 1 2
based payment
-
69,202,6
4. Other 69,202,657.0 -69,202,657.07
57.07
7
- - -
(III) Profit
distribution 1,609,059,66 1,609,059,66 1,609,059,668.8
8.80 8.80 0
1. Withdrawal
of surplus
reserves
2. Withdrawal
of general risk
provisions
3. Distribution - - -
for owners (or 1,609,059,66 1,609,059,66 1,609,059,668.8
shareholders) 8.80 8.80 0
4. Other
(IV) Carrying
forward
internal
owners’ equity
1. Capital
reserves
converted to
capital (share
capital)
2. Surplus
reserves
converted to
capital (share
capital)
3. Remedying
loss with
surplus reserve
17
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
4. Carry-over
retained
earnings from
the defined
benefit plans
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(V)
1,003,249.9
Reasonable 1,003,249.94 95,687.29 1,098,937.23
reserve 4
1. Withdrawal
13,239,465. 13,239,465.2 1,346,071.8
in the reporting 14,585,537.11
period 25 5 6
2. Usage in the
12,236,215. 12,236,215.3 1,250,384.5
reporting 13,486,599.88
period 31 1 7
(VI)Others
IV. Balance at -
the end of the 1,008,659, 3,406,077,3 339,452, 1,715,465.2 510,100,49 14,296,854,1 18,834,528,5 602,937,98 19,437,466,566.
reporting 49,425,996.
570.00 13.83 454.81 5 6.00 89.14 82.65 4.03 68
period 76
18
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
6. Statement of changes in owners’ equity of parent company
Current Period
In RMB
2023 semi-annual
Other equity
instrument
Perp
Other
Item Pref etual
Share Less: Inventory compreh Reasonable
erre capit Capital reserve Surplus reserve Retained profit Other Total owners’ equity
capital Othe shares ensive reserve
d al
r income
stoc secu
k ritie
s
I. Balance at the
1,008,603,29
end of the last 3,515,005,861.23 541,623,002.63 510,100,496.00 10,765,319,818.29 15,257,406,465.89
year 3.00
Add: Changes of
accounting
policy
Error correction
of the last period
Other
II. Balance at the
1,008,603,29
beginning of this 3,515,005,861.23 541,623,002.63 510,100,496.00 10,765,319,818.29 15,257,406,465.89
year 3.00
III. Increase/
Decrease in
-
reporting period -63,036,715.42 -3,212,730.39 716,065,244.46 650,217,759.43
(Decrease is 6,023,500.00
listed with “-”)
(i) Total
comprehensive 813,823,223.76 813,823,223.76
income
(ii) Owners’
devoted and -
-63,036,715.42 -3,212,730.39 -65,847,485.03
decreased 6,023,500.00
capital
19
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
1.Common
shares invested
by shareholders
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity 5,522,079.67 5,522,079.67
with share-based
payment
-
4. Other -68,558,795.09 -3,212,730.39 -71,369,564.70
6,023,500.00
(III) Profit
-97,757,979.30 -97,757,979.30
distribution
1. Withdrawal of
surplus reserves
2. Distribution
for owners (or -97,757,979.30 -97,757,979.30
shareholders)
3. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital
reserves
converted to
capital (share
capital)
2. Surplus
reserves
converted to
capital (share
capital)
3. Remedying
loss with surplus
reserve
4. Carry-over
retained
earnings from
the defined
benefit plans
20
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(V) Reasonable
reserve
1. Withdrawal in
the reporting 3,237,252.50 3,237,252.50
period
2. Usage in the
3,237,252.50 3,237,252.50
reporting period
(VI)Others
IV. Balance at
1,002,579,79
the end of the 3,451,969,145.81 538,410,272.24 510,100,496.00 11,481,385,062.75 15,907,624,225.32
reporting period 3.00
Last Period
In RMB
2022 semi-annual
Other equity
instrument
Perp
Other
Item Pref etual
Share Less: Inventory compreh Reasonable
erre capit Capital reserve Surplus reserve Retained profit Other Total owners’ equity
capital Othe shares ensive reserve
d al
r income
stoc secu
k ritie
s
I. Balance at
1,008,659,57
the end of the 3,487,154,855.59 270,249,797.74 0.00 510,100,496.00 12,396,934,922.01 17,132,600,045.86
last year 0.00
Add: Changes
of accounting
policy
Error correction
of the last
period
Other
II. Balance at
1,008,659,57
the beginning 3,487,154,855.59 270,249,797.74 0.00 510,100,496.00 12,396,934,922.01 17,132,600,045.86
of this year 0.00
21
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
III. Increase/
Decrease in
reporting
35,819,280.96 69,202,657.07 -699,881,040.34 -733,264,416.45
period
(Decrease is
listed with “-”)
(i) Total
comprehensive 909,178,628.46 909,178,628.46
income
(ii) Owners’
devoted and
35,819,280.96 69,202,657.07 -33,383,376.11
decreased
capital
1. Common
shares invested
by shareholders
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity 35,819,280.96 35,819,280.96
with share-
based payment
4. Other 69,202,657.07 -69,202,657.07
(III) Profit
-1,609,059,668.80 -1,609,059,668.80
distribution
1. Withdrawal
of surplus
reserves
2. Distribution
for owners (or -1,609,059,668.80 -1,609,059,668.80
shareholders)
3. Other
(IV) Carrying
forward
internal
owners’ equity
22
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
1. Capital
reserves
converted to
capital (share
capital)
2. Surplus
reserves
converted to
capital (share
capital)
3. Remedying
loss with
surplus reserve
4. Carry-over
retained
earnings from
the defined
benefit plans
5. Carry-over
retained
earnings from
other
comprehensive
income
6. Other
(V) Reasonable
reserve
1. Withdrawal
in the reporting 3,366,170.40 3,366,170.40
period
2. Usage in the
reporting 3,366,170.40 3,366,170.40
period
(VI) Others
IV. Balance at
the end of the 1,008,659,57
3,522,974,136.55 339,452,454.81 0.00 510,100,496.00 11,697,053,881.67 16,399,335,629.41
reporting 0.00
period
23
I I I . Basic information of the Company
1. Historical origin of the Company
By the approval of STGS (1992) No. 130 issued by Jiangsu Economic Restructuring Committee, Weifu High-
Technology Group Co., Ltd. (hereinafter referred to “the Company” or “Company”) was established as a company
of limited liability with funds raised from targeted sources, and registered at Wuxi Administration for Industry &
Commerce in October 1992. The original share capital of the Company totaled 115.4355 million yuan, including
state-owned share capital amounting to 92.4355 million yuan, public corporate share capital amounting to 8
million yuan and inner employee share capital amounting to 15 million yuan.
Between year of 1994 and 1995, the Company was restructured and became a holding subsidiary of Wuxi Weifu
Group Co., Ltd (hereinafter referred to as “Weifu Group”).
By the approval of Jiangsu ERC and Shenzhen Securities Administration Office in August 1995, the Company
issued 68 million special ordinary shares (B-share) with value of 1.00 yuan for each, and the total value of those
shares amounted to 68 million yuan. After the issuance, the Company’s total share capital increased to 183.4355
million yuan.
By the approval of CSRC in June 1998, the Company issued 120 million RMB ordinary shares (A-share) at
Shenzhen Stock Exchange through on-line pricing and issuing. After the issuance, the total share capital of the
Company amounted to 303.4355 million yuan.
In the middle of 1999, deliberated and approved by the Board and Shareholders’ General Meeting, the Company
implemented the plan of granting 3 bonus shares for each 10 shares. After that, the total share capital of the
Company amounted to 394.46615 million yuan, of which state-owned shares amounted to 120.16615 million yuan,
public corporate shares 10.4 million yuan, foreign-funded shares (B-share) 88.40 million yuan, RMB ordinary
shares (A-share) 156 million yuan and inner employee shares 19.5 million yuan.
In the year 2000, by the approval of the CSRC and based upon the total share capital of 303.4355 million shares
after the issuance of A-share in June 1998, the Company allotted 3 shares for each 10 shares, with a price of 10
yuan for each allotted share. Actually 41.9 million shares was allotted, and the total share capital after the
allotment increased to 436.36615 million yuan, of which state-owned corporate shares amounted to 121.56615
million yuan, public corporate shares 10.4 million yuan, foreign-funded shares (B-share) 88.4 million yuan and
RMB ordinary shares (A-share) 216 million yuan.
In April 2005, Board of Directors of the Company has examined and approved 2004 Profit Pre-distribution Plan,
and examined and approved by 2004 Shareholders’ General Meeting, the Company distributed 3 shares for each
10 shares to the whole shareholders totaling to 130,909,845 shares in 2005.
According to the Share Merger Reform Scheme of the Company that passed by related shareholders’ meeting of
Share Merger Reform and SGZF [2006] No.61 Reply on Questions about State-owned Equity Management in
Share Merger Reform of Weifu High-Technology Co., Ltd. issued by State-owned Assets Supervision &
Administration Commission of Jiangsu Province, the Weifu Group etc. 8 non-circulating shareholders arranged
pricing with granting 1.7 shares for each 10 shares to circulating A-share shareholders (totally granted 47,736,000
shares), so as to realize the originally non-circulating shares can be traded on market when satisfied certain
conditions, the scheme has been implemented on April 5, 2006.
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
On May 27, 2009, Weifu Group satisfied the consideration arrangement by dispatching 0.5 shares for each 10
shares based on the number of circulating A share as prior to Share Merger Reform, according to the aforesaid
Share Merger Reform, with an aggregate of 14,039,979 shares dispatched. Subsequent to implementation of
dispatch of consideration shares, Weifu Group then held 100,021,999 shares of the Company, representing 17.63%
of the total share capital of the Company.
Pursuant to the document (XGZQ(2009)No.46) about Approval for Merger of Wuxi Weifu Group Co., Ltd. by
Wuxi Industry Development Group Co., Ltd. issued by the State-owned Assets Supervision and Administration
Commission of Wuxi City Government, Wuxi Industry Development Group Co., Ltd. (hereinafter referred to as
Wuxi Industry Group) acquired Weifu Group. After the merger, Weifu Group was then revoked, and its assets and
credits & debts were transferred to be under the name of Wuxi Industry Group. Accordingly, Wuxi Industry
Group became the first largest shareholder of the Company since then.
In accordance with the resolutions of shareholders' meeting and provisions of amended constitution, and approved
by [2012] No. 109 document of China Securities Regulatory Commission, in February 2012, the Company issued
RMB ordinary shares (A-share) of 112,858,000 shares to Wuxi Industry Groups and overseas strategic investor
privately, Robert Bosch Co., Ltd. (ROBERT BOSCHGMBH) (hereinafter referred to as Robert Bosch Company),
face value was 1.00 yuan per share, added registered capital of 112,858,000 yuan, and the registered capital after
change was 680,133,995 yuan. Wuxi Industry Group is the first majority shareholder of the Company, and Robert
Bosch Company is the second majority shareholder of the Company.
In March 2013, the profit distribution pre-plan for year of 2012 was deliberated and approved by the Board, and
also passed in Annual General Meeting 2012 of the Company in May 2013. On basis of total share capital
680,133,995 shares, distribute 5-share for every 10 shares held by whole shareholders, 340,066,997 shares in total
are distributed. Total share capital of the Company amounting 1,020,200,992 yuan up to December 31, 2013.
Deliberated and approved by the company’s first extraordinary general meeting in 2015, the company has
repurchased 11,250,422 shares of A shares from August 26, 2015 to September 8, 2015, and has finished the
cancellation procedures for above repurchase shares in China Securities Depository and Clearing Corporation
Limited Shenzhen Branch on September 16, 2015; after the cancellation of repurchase shares, the company’s
paid-up capital (share capital) becomes 1,008,950,570 yuan after the change.
After deliberation and approved by the 5th meeting of 10th session of the BOD for year of 2021, the 291,000
restricted shares are buy-back and canceled by the Company initially granted under the 2020 Restricted Share
Incentive Plan. The cancellation of the above mentioned buy-back shares are completed at the Shenzhen Branch
of CSDC on December 20, 2021; the paid-in capital (equity) of the Company comes to 1,008,659,570.00 yuan
after changed.
After deliberated and approved by the 8th meeting of 10th session of the BOD for year of 2022, the 56,277
restricted shares are buy-back and canceled by the Company initially granted under the 2020 Restricted Share
Incentive Plan. The cancellation of the above mentioned buy-back shares are completed at the Shenzhen Branch
of CSDC on July 8, 2022; the paid-in capital (equity) of the Company came to 1,008,603,293.00 yuan after
changed.
After deliberated and approved by the 14th meeting of 10th session of the BOD in 2022, the company repurchased
25
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
and canceled 430,000 restricted stock granted for the first time under Restricted Share Incentive Plan 2020, and
completed the cancellation procedures of the repurchased shares in China Securities Depository and Clearing
Corporation Co., Ltd., Shenzhen Branch on February 16, 2023; The Paid-in capital (share capital) of the Company
after the change is 1,008,603,293.00 yuan.
Deliberated and approved by the 16th meeting of 10th session of the BOD in 2023, the company repurchased and
canceled 5,593,500 restricted stock granted for the first time under Restricted Share Incentive Plan 2020, and
completed the cancellation procedures of the repurchased shares in China Securities Depository and Clearing
Corporation Co., Ltd., Shenzhen Branch on June 16, 2023; The Paid-in capital (share capital) of the Company
after the change is 1,002,579,793.00 yuan.
2. Registered place, organization structure and head office of the Company
Registered place and head office of the Company: No.5 Huashan Road, Xinwu District, Wuxi
Unified social credit code: 91320200250456967N
The Company sets up Shareholders’ General Meeting, the Board of Directors (BOD) and the Board of Supervisors
The Company sets up Administration Department, Technology Centre, organization & personnel department,
Office of the Board, Compliance Department, IT department, Strategy & New Business Department, Market
Development Department, Party-masses Department, Finance Department, Purchase Department,Manufacturing
Quality Department, MS (Mechanical System) Division, AC(Automotive Components) Division and DS (Diesel
System ) Division, etc. and subsidiaries such as WUXI WEIFU LIDA CATALYTIC CONVERTER CO., LTD,
NANJING WEIFU JINNING CO., LTD, IRD Fuel Cells A/S and Borit NV.
3. Business nature and major operation activities of the Company
Operation scope of parent company: Technology development and consulting service in the machinery industry;
manufacture of engine fuel oil system products, fuel oil system testers and equipment, manufacturing of auto
electronic parts, automotive electrical components, non-standard equipment, non-standard knife tool and exhaust
post-processing system; sales of the general machinery, hardware & electrical equipment, chemical products &
raw materials (excluding hazardous chemicals), automotive components and vehicles (excluding nine-seat
passenger car); internal combustion engine maintenance; leasing of the own houses; import and export business in
respect of diversified commodities and technologies (other than those commodities and technologies limited or
forbidden by the State for import and export) by self-operation and works as agent for such business. Research
and test development of engineering and technical; R&D of the energy recovery system; manufacture of auto
components and accessories; general equipment manufacturing (excluding special equipment manufacturing),
(any projects that needs to be approved by laws can only be carried out after getting approval by relevant
authorities) General items: engage in investment activities with self-owned funds (except for items subject to
approval according to the law, independently carry out business activities according to laws with business
licenses )
Major subsidiaries respectively activate in production and sales of engine accessories, automotive components,
mufflers, purifiers and fuel cell components etc.
4. Authorized reporting parties and reporting dates for the financial report
26
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
The financial report of the Company was approved by the Board of Directors for reporting dated August 22, 2023.
5. Scope of consolidate financial statement
Shareholding Register State
ratio (%) Proporti ed ment
Short name
on of capital Business conso
Name of subsidiary of
Direct Indire votes (in 10 scope lidate
subsidiary
ly ctly (%) thousan d
d yuan) (Y/N)
Internal-
34,628. combustion
NANJING WFJN CO., LTD. WFJN 80.00 -- 80.00 Y
70 engine
accessories
WUXI WEIFU LIDA CATALYTIC 50,259. Purifier and
WFLD 94.81 -- 94.81 Y
CONVERTER CO., LTD. 63 muffler
Internal-
WUXI WEIFU MASHAN FUEL 100.0 combustion
WFMA -- 100.00 16,500 Y
INJECTION EQUIPMENT CO., LTD. 0 engine
accessories
Internal-
100.0 combustion
WUXI WEIFU CHANGAN CO.,LTD. WFCA -- 100.00 21,000 Y
0 engine
accessories
WUXI WEIFU INTERNATIONAL 100.0
WFTR -- 100.00 3,000 Trade Y
TRADE CO.,LTD. 0
Internal-
WUXI WEIFU SCHMITTER combustion
WFSC 66.00 -- 66.00 7,600 Y
POWERTRAIN COMPONENTS CO.,LTD. engine
accessories
Internal-
NINGBO WFTT TURBOCHARGING combustion
WFTT 98.83 1.17 100.00 11,136 Y
TECHNOLOGY CO.,LTD. engine
accessories
WUXI WFAM PRECISION MACHINERY USD3,3 Automotive
WFAM 51.00 -- 51.00 Y
CO.,LTD. 10 components
WUXI WEIFU LIDA CATALYTIC WFLD Purifier and
-- 60.00 60.00 1,000 Y
CONVERTER (WUHAN) CO., LTD. (WUHAN) muffler
WFLD
Weifu Lida (Chongqing) Automotive 100.0 Purifier and
(Chongqing -- 100.00 5,000 Y
components Co., Ltd. 0 muffler
)
Nanchang Weifu Lida Automotive WFLD 100.0 Purifier and
-- 100.00 5,000 Y
Components Co., Ltd. (Nanchang) 0 muffler
WUXI WEIFU AUTOSMART SEATING Smart car
WFAS -- 66.00 66.00 10,000 Y
SYSTEM CO., LTD. device
WUXI WEIFU E-DRIVE USD2,0
WFDT 80.00 -- 80.00 Wheel motor Y
TECHNOLOGIES CO., LTD. 00
Wuxi Weifu Qinglong Power Technology Fuel cell
WFQL 45.00 30.00 75.00 50,000 Y
Co., Ltd. components
Vacuum and
100.0
VHIT Automotive Systems(Wuxi) Co.Ltd VHWX -- 100.00 13,400 hydraulic Y
0
pump
100.0 DKK9,2
Weifu Holding ApS SPV -- 100.00 Investment Y
0 57
100.0 DKK10, Fuel cell
IRD Fuel Cells A/S IRD -- 100.00 Y
0 579 components
IRD 100.0 USD1,2 Fuel cell
IRD FUEL CELLS LLC -- 100.00 Y
America 0 01.83 components
100.0 EUR1,1 Fuel cell
Borit NV Borit -- 100.00 Y
0 83.21 components
Borit 100.0 Fuel cell
Borit Inc. -- 100.00 USD0.1 Y
America 0 components
Vacuum and
100.0 EUR50
VHIT S.p.A. SocietàUnipersonale VHIO -- 100.00 hydraulic Y
0 0
pump
27
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
IV. Basis of preparation of financial statements
1. Preparation base
The financial statement were stated in compliance with Accounting Standard for Business Enterprises –Basic Norms issued by
Ministry of Finance, the specific 42 accounting rules revised and issued dated February 15, 2006 and later, the Application
Instruments of Accounting Standards and interpretation on Accounting standards and other relevant regulations (together as
“Accounting Standards for Business Enterprise”), as well as the Compilation Rules for Information Disclosure by Companies
Offering Securities to the Public No.15 – General Provision of Financial Report (Amended in 2014) issued by CSRC in respect of
the actual transactions and proceedings, on a basis of ongoing operation.
In line with relevant regulations of Accounting Standards of Business Enterprise, accounting of the Company is on accrual basis.
Except for certain financial instruments, the financial statement measured on historical cost. Assets have impairment been found,
corresponding depreciation reserves shall accrual according to relevant rules.
2. Going concern
The Company comprehensively assessed the available information, and there are no obvious factors that impact sustainable operation
ability of the Company within 12 months since end of the reporting period.
V. Major accounting policies and estimation
Specific accounting policies and estimation attention:
The Company and its subsidiaries are mainly engaged in the manufacture and sales of engine fuel oil system products, automotive
components, mufflers, purifiers and fuel cell components etc., in line with the actual operational characteristics and relevant
accounting standards, many specific accounting policies and estimation have been formulated for the transactions and events with
revenue recognized concerned. As for the explanation on major accounting judgment and estimation, found more in Note V- 36.
Other major accounting policy and estimation
1. Statement on observation of Accounting Standard for Business Enterprises
Financial statements prepared by the Company were in accordance with requirements of Accounting Standard for Business
Enterprises, which truly and completely reflected the financial information of the Company in the reporting period, such as financial
status, operation achievements and cash flow.
2. Accounting period
Accounting period of the Company consist of annual and mid-term, mid-term refers to the reporting period shorter than one annual
accounting year. The company adopts Gregorian calendar as accounting period, namely form each 1 January to 31 December.
3. Business cycles
Normal business cycle is the period from purchasing assets used for process by the Company to the cash and cash equivalent
achieved. The Company’s normal business cycle was one-year (12 months).
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
4. Recording currency
The Company’s reporting currency is the RMB yuan.
5. Accounting treatment method for business combinations under the same/different control
Business combination is the transaction or events that two or two above independent enterprises combined as a reporting entity.
Business combination including enterprise combined under the same control and business combined under different control.
(1) The business combination under the same control
Enterprise combination under the same control is the enterprise who take part in the combination are have the same ultimate
controller or under the same controller, the control is not temporary. The assets and liability acquired by combining party are
measured by book value of the combined party on combination date. Balance of net asset’s book value acquired by combining party
and combine consideration paid (or total book value of the shares issued), shall adjusted capital reserve (share premium); if the
capital reserves (share premium) is not enough for deducted, adjusted for retained earnings. Vary directly expenses occurred for
enterprise combination, the combining party shall reckon into current gains/losses while occurring. Combination day is the date when
combining party obtained controlling rights from the combined party.
(2) Combine not under the same control
A business combination not involving entities under common control is a business combination in which all of the combining entities
are not ultimately controlled by the same party or parties both before and after the combination.As a purchaser, fair value of the
assets (equity of purchaser held before the date of purchasing included) for purchasing controlling right from the purchaser, the
liability occurred or undertake on purchasing date less the fair value of identifiable net assets of the purchaser obtained in
combination, recognized as goodwill if the results is positive; if the number is negative, the acquirer shall firstly review the
measurement of the fair value of the identifiable assets obtained, liabilities incurred and contingent liabilities incurred, as well as the
combination costs.After that, if the combination costs are still lower than the fair value of the identifiable net assets obtained, the
acquirer shall recognize the difference as the profit or loss in the current period.Other directly expenses cost for combination shall be
reckoned into current gains/losses. Difference of the fair value of assets paid and its book values, reckoned into current gains/losses.
On purchasing date, the identifiable assets, liability or contingency of the purchaser obtained by the Company recognized by fair
value, that required identification conditions; Acquisition date refers to the date on which the acquirer effectively obtains control of
the purchaser.
6. Preparation method for consolidated financial statement
(1) Recognition principle of consolidated scope
On basis of the financial statement of the parent company and owned subsidiaries, prepared consolidated statement in line with
relevant information. The scope of consolidation of consolidated financial statements is ascertained on the basis of effective control.
Once certain elements involved in the above definition of control change due to changes of relevant facts or circumstances, the
Company will make separate assessment.
(2) Basis of control
Control is the right to govern an invested party so as to obtain variable return through participating in the invested party’s relevant
activities and the ability to affect such return by use of the aforesaid right over the invested party. Relevant activates refers to
activates have major influence on return of the invested party’s.
(3) Consolidation process
Subsidiaries are consolidated from the date on which the company obtains their actual control, and are de-consolidated from the date
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
that such control ceases.All significant inter-group balances, investment, transactions and unrealized profits are eliminated in the
consolidated financial statements.For subsidiaries being disposed, the operating results and cash flows prior to the date of disposal
are included in the consolidated income statement and consolidated cash flow statement; for subsidiaries disposed during the period,
the opening balances of the consolidated balance sheet would not be restated. For subsidiaries acquired from a business combination
not under common control, their operating results and cash flows subsequent to the acquisition date are included in the consolidated
income statement and consolidated cash flow statement, and the opening balances and comparative figures of the consolidated
balance sheet would not be restated. For subsidiaries acquired from a business combination under common control, their operating
results and cash flows from the date of commencement of the accounting period in which the combination occurred to the date of
combination are included in the consolidated income statement and consolidated cash flow statement, and the comparative figures of
the consolidated balance sheet would be restated.
In preparing the consolidated financial statements, where the accounting policies or the accounting periods are inconsistent between
the company and subsidiaries, the financial statements of subsidiaries are adjusted in accordance with the accounting policies and
accounting period of the company.
Concerning the subsidiary obtained under combination with different control, adjusted several financial statement of the subsidiary
based on the fair value of recognizable net assets on purchased day while financial statement consolidation; concerning the subsidiary
obtained under combination with same control, considered current status of being control by ultimate controller for consolidation
while financial statement consolidation.
The unrealized gains and losses from the internal transactions occurred in the assets the Company sold to the subsidiaries fully offset
"the net profit attributable to the owners of the parent company". The unrealized gains and losses from the internal transactions
occurred in the assets the subsidiaries sold to the Company are distributed and offset between "the net profit attributable to the
owners of the parent company" and "minority interest" according to the distribution ratio of the Company to the subsidiary. The
unrealized gains and losses from the internal transactions occurred in the assets sold among the subsidiaries are distributed and offset
between "the net profit attributable to the owners of the parent company" and "minority interest" according to the distribution ratio of
the Company to the subsidiary of the seller.
The share of the subsidiary’s ownership interest not attributable to the Company is listed as “minority interest” item under the
ownership interest in the consolidated balance sheet. The share of the subsidiary’s current profit or loss attributable to the minority
interests is listed as "minority interest" item under the net profit item in the consolidated income statement. The share of the
subsidiary’s current consolidated income attributable to the minority interests is listed as the “total consolidated income attributable
to the minority shareholders” item under the total consolidated income item in the consolidated income statement. If there are
minority shareholders, add the "minority interests" item in the consolidated statement of change in equity to reflect the changes of the
minority interests. If the losses of the current period shared by a subsidiary’s minority shareholders exceed the share that the minority
shareholders hold in the subsidiary ownership interest in the beginning of the period, the balance still charges against the minority
interests.
When the control over a subsidiary is ceased due to disposal of a portion of an interest in a subsidiary, the fair value of the remaining
equity interest is re-measured on the date when the control ceased. The difference between the sum of the consideration received
from disposal of equity interest and the fair value of the remaining equity interest, less the net assets attributable to the company
since the acquisition date, is recognized as the investment income from the loss of control. Other comprehensive income relating to
original equity investment in subsidiaries shall be treated on the same basis as if the relevant assets or liabilities were disposed of by
the purchaser directly when the control is lost, namely be transferred to current investment income other than the relevant part of the
movement arising from re-measuring net liabilities or net assets under defined benefit scheme by the original subsidiary. Subsequent
measurement of the remaining equity interests shall be in accordance with relevant accounting standards such as Accounting
Standards for business Enterprises 2 – Long-term Equity Investments or Accounting Standards for business Enterprises 22 –
Financial Instruments Recognition and Measurement.
The company shall determine whether loss of control arising from disposal in a series of transactions should be regarded as a bundle
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
of transactions. When the economic effects and terms and conditions of the disposal transactions met one or more of the following
situations, the transactions shall normally be accounted for as a bundle of transactions: ① The transactions are entered into after
considering the mutual consequences of each individual transaction; ② The transactions need to be considered as a whole in order to
achieve a deal in commercial sense;③ The occurrence of an individual transaction depends on the occurrence of one or more
individual transactions in the series; ④ The result of an individual transaction is not economical, but it would be economical after
taking into account of other transactions in the series. When the transactions are not regarded as a bundle of transactions, the
individual transactions shall be accounted as “disposal of a portion of an interest in a subsidiary which does not lead to loss of control”
and “disposal of a portion of an interest in a subsidiary which lead to loss of control”. When the transactions are regarded as a bundle
of transactions, the transactions shall be accounted as a single disposal transaction; however, the difference between the consideration
received from disposal and the share of net assets disposed in each individual transaction before loss of control shall be recognized as
other comprehensive income, and reclassified as profit or loss arising from the loss of control when control is lost.
7. Joint arrangement classification and accounting treatment for joint operations
In accordance with the Company’s rights and obligation under a joint arrangement, the Company classifies joint arrangements into:
joint ventures and joint operations.
The Company confirms the following items related to the share of interests in its joint operations, and in accordance with the
provisions of the relevant accounting standards for accounting treatment:
(1) Recognize the assets held solely by the Company, and recognize assets held jointly by the Company in appropriation to the share
of the Company;
(2) Recognize the obligations assumed solely by the Company, and recognize obligations assumed jointly by the Company in
appropriation to the share of the Company;
(3) Recognize revenue from disposal of the share of joint operations of the Company;
(4) Recognize fees solely occurred by Company;
(5) Recognize fees from joint operations in appropriation to the share of the Company.
8. Recognition standards for cash and cash equivalent
Cash refers to stock cash, savings available for paid at any time; cash and cash equivalent refers to the cash held by the Company
with short terms (expired within 3 months since purchased), and liquid and easy to transfer as known amount and investment with
minor variation in risks.
9. Foreign currency business and conversion
The occurred foreign currency transactions are converted into the recording currency in accordance with the middle rate of the
market exchange rate published by the People's Bank of China on the transaction date. There into, the occurred foreign currency
exchange or transactions involved in the foreign currency exchange are converted in accordance with the actual exchange rate in the
transactions.
At the balance sheet date, the account balance of the foreign currency monetary assets and liabilities is converted into the recording
currency amount in accordance with the middle rate of the market exchange rate published by the People's Bank of China on the
transaction date. The balance between the recording currency amount converted according to exchange rate at the balance sheet date
and the original recording currency amount is disposed as the exchange gains or losses. There into, the exchange gains or losses
occurred in the foreign currency loans related to the purchase and construction of fixed assets are disposed according to the principle
of capitalization of borrowing costs; the exchange gains and losses occurred during the start-up are included in the start-up costs; the
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
rest is included in the current financial expenses.
At the balance sheet date, the foreign currency non-monetary items measured with the historical costs are converted in accordance
with the middle rate of the market exchange rate published by the People's Bank of China on the transaction date without changing
its original recording currency amount; the foreign currency non-monetary items measured with the fair value are converted in
accordance with the middle rate of the market exchange rate published by the People's Bank of China on the fair value date,and the
generated exchange gains and losses are included in the current profits and losses as the gains and losses from changes in fair value.
The following displays the methods for translating financial statements involving foreign operations into the statements in RMB: The
asset and liability items in the balance sheets for overseas operations are translated at the spot exchange rates on the balance sheet
date. Among the owners’ equity items, the items other than “undistributed profits” are translated at the spot exchange rates of the
transaction dates. The income and expense items in the income statements of overseas operations are translated at the average
exchange rates of the transaction dates. The exchange difference arising from the above mentioned translation are recognized in other
comprehensive income and is shown separately under owner’ equity in the balance sheet; such exchange difference will be
reclassified to profit or loss in current year when the foreign operation is disposed according to the proportion of disposal.
The cash flows of overseas operations are translated at the average exchange rates on the dates of the cash flows. The effect of
exchange rate changes on cash is presented separately in the cash flow statement.
10. Financial instrument
Financial instrument is the contract that taken shape of the financial asses for an enterprise and of the financial liability or equity
instrument for other units.
(1) Recognition and termination of financial instrument
A financial asset or liability is recognized when the group becomes a party to a financial instrument contract.
The recognition of a financial assets shall be terminated if it meets one of the following conditions:
① The contractual right to receive the cash flow of the financial assets terminates; and
② The financial assets are transferred and the company transfers substantially all the risks and rewards of ownership of the financial
asset to the transferring party;
③ The financial asset was transferred and control, although the company has neither transferred nor retained almost all the risks and
rewards of the ownership of a financial asset, it relinquishes control over the financial asset.
If all or part of the current obligations of a financial liability has been discharged, the financial liability or part of it is terminated for
recognition. When the Company (debtor) and the creditor sign an agreement to replace the existing financial liabilities with new
financial liabilities, and the new financial liabilities and the existing financial liabilities are substantially different from the contract
terms, terminated the recognition of the existing financial liabilities and recognize the new financial liabilities at the same time.
Financial assets are traded in the normal way and their accounting recognition and terminated the recognition of proceed on a trade
date basis.
(2) Classification and measurement of financial assets
At the initial recognition, according to the business model of managing financial assets and the contractual cash flow characteristics
of financial assets, the Company classifies the financial assets into the financial assets measured at amortized cost, the financial
assets measured at fair value and whose changes are included in other comprehensive income, and the financial assets measured at
fair value and whose changes are included in current profit or loss. Financial assets are measured at fair value at initial recognition,
but if the receivables or receivables financing arising from the sale of goods or the provision of services do not include a significant
financing component or do not consider a financing component that does not exceed one year, it shall be initially measured in
accordance with the transaction value. For financial assets measured at fair value and whose changes are included in the current
profit or loss, related transaction costs are directly included in the current profit and loss; for other types of financial assets, related
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
transaction costs are included in the initially recognized amount.
The business model for managing financial assets refers to how the Company manages financial assets to generate cash flows. The
business model determines whether the cash flow of financial assets managed by the Company is based on contract cash flow, selling
financial assets or both. The Company determines the business model for managing financial assets based on objective facts and
based on the specific business objectives of financial assets management determined by key management personnel.
The Company evaluates the contractual cash flow characteristics of financial assets to determine whether the contractual cash flows
generated by the relevant financial assets on a specific date are only payments for the principal and the interest based on the
outstanding principal amount. The principal is the fair value of the financial assets at initial recognition; the interest includes the time
value of money, the credit risk associated with the outstanding principal amount for a specific period, and other basic borrowing risks,
costs and consideration of profit. In addition, the Company evaluates the contractual terms that may result in changes in the time
distribution or the amount of contractual cash flows of the financial assets to determine whether they meet the requirements of the
above contractual cash flow characteristics.
Only when the Company changes its business model of managing financial assets, all affected financial assets are reclassified on the
first day of the first reporting period after the business model changes, otherwise the financial assets are not allowed to be reclassified
after initial recognition.
① Financial assets measured at amortized cost
The Company classifies the financial assets that meet the following conditions and haven’t been designated as financial assets
measured at fair value and whose changes are included in current profit or loss as financial assets measured at amortized cost:
A. the group's business model for managing the financial assets is to collect contractual cash flows; and
B. the contractual terms of the financial assets stipulate that cash flow generated on a specific date is only paid for the principal and
interest based on the outstanding principal amount.
After initial recognition, such financial assets are measured at amortized cost by using the effective interest method. Gains or losses
arising from financial assets which are measured at amortized cost and are not a component of any hedging relationship are included
in current profit or loss when being terminated for recognition, amortized by effective interest method, or impaired.
② Financial assets measured at fair value and whose changes are included in other comprehensive income
The Company classifies the financial assets that meet the following conditions and haven’t been designated as financial assets
measured at fair value and whose changes are included in current profit or loss as financial assets measured at fair value and whose
changes are included in other comprehensive income:
A. the Group's business model for managing the financial assets is targeted at both the collection of contractual cash flows and the
sale of financial assets; and
B. the contractual terms of the financial asset stipulate that the cash flow generated on a specific date is only the payment of the
principal and the interest based on the outstanding principal amount.
After initial recognition, such financial assets are subsequently measured at fair value. Interests, impairment losses or gains and
exchange gains and losses calculated by using the effective interest method are included in profit or loss for the period, and other
gains or losses are included in other comprehensive income. When being terminate for recognition, the accumulated gains or losses
previously included in other comprehensive income are transferred from other comprehensive income and included in current profit
or loss.
③ Financial assets measured at fair value and whose changes are included in current profit or loss
Except for the above financial assets measured at amortized cost and measured at fair value and whose changes are included in other
comprehensive income, the Company classifies all other financial assets as financial assets measured at fair value and whose changes
are included in current profit or loss. In the initial recognition, in order to eliminate or significantly reduce accounting mismatch, the
Company irreversibly designates part of the financial assets that should be measured at amortized cost or measured at fair value and
whose changes are included in the other comprehensive income as the financial assets measured at fair value and whose changes are
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
included in current profit or loss.
After the initial recognition, such financial assets are subsequently measured at fair value, and the gains or losses (including interests
and dividend income) are included in the current profit and loss, unless the financial assets are part of the hedging relationship.
However, for non-trading equity instrument investments, the Company irreversibly designates them as the financial assets that are
measured at fair value and whose changes are included in other comprehensive income in the initial recognition. The designation is
made based on a single investment and the relevant investment is in line with the definition of equity instruments from the issuer's
perspective. After initial recognition, such financial assets are subsequently measured at fair value. Dividend income that meets the
conditions is included in profit or loss, and other gains or losses and changes in fair value are included in other comprehensive
income. When it is terminated for recognition, the accumulated gains or losses previously included in other comprehensive income
are transferred from other comprehensive income and included in retained earnings.
(3) Classification and measurement of financial liabilities
The financial liabilities of the Company are classified as financial liabilities measured at fair value and whose changes are included in
current profit or loss and financial liabilities measured at amortized cost at the initial recognition. For financial liabilities that are not
classified as financial liabilities measured at fair value and whose changes are included in current profit or loss, the related
transaction expenses are included in the initial recognition amount.
① Financial liability measured by fair value and with variation reckoned into current gains/losses
Financial liability measured by fair value and with variation reckoned into current gains/losses including tradable financial liability
and the financial liabilities that are designated as fair value in the initial recognition and whose changes are included in current profit
or loss. For such financial liabilities, the subsequent measurement is based on fair value, and the gains or losses arising from changes
in fair value and the dividends and interest expenses related to these financial liabilities are included in current profit or loss.
② Financial liability measured by amortized cost
Other financial liabilities are subsequently measured at amortized cost by using the effective interest method. The gain or loss arising
from recognition termination or amortization is included in current profit or loss.
③ Distinctions between financial liabilities and equity instruments
Financial liabilities are liabilities that meet one of the following conditions:
A. Contractual obligations to deliver cash or other financial assets to other parties.
B. Contractual obligations to exchange financial assets or financial liabilities with other parties under potentially adverse conditions.
C. Non-derivative contracts that must be settled or that can be settled by the company's own equity instruments in the future, and the
enterprise will deliver a variable amount of its own equity instruments according to the contract.
D. Derivative contracts that must be settled or that can be settled by the company's own equity instruments in the future, except for
derivatives contracts that exchange a fixed amount of cash or other financial assets with a fixed amount of their own equity
instruments.
An equity instrument is a contract that proves it has a residual equity in the assets of an enterprise after deducting all liabilities.
If the Company cannot unconditionally avoid performing a contractual obligation by delivering cash or other financial assets, the
contractual obligation is consistent with the definition of financial liability.
If a financial instrument is required to be settled or can be settled by the Company's own equity instruments, it is necessary to
consider whether the Company's own equity instruments used to settle the instrument are a substitute for cash or other financial
assets, or to make the instrument holder enjoy the residual equity in the assets of the issuer after deducting all liabilities. In the former
case, the instrument is the Company's financial liability; if it is the latter, the instrument is the Company's equity instrument.
(4) Fair value of financial instruments
The company uses valuation techniques that are applicable under current circumstances and that have sufficient available data and
other information support to determine the fair value of related financial assets and financial liabilities. The company divides the
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
input values used by valuation techniques into the following levels and uses them in sequence:
① The first-level input value is the unadjusted quotation of the same assets or liabilities that can be obtained on the measurement
date in the active market;
② The second-level input value is the direct or indirect observable input value of the relevant assets or liabilities other than the first-
level input value, including quotations of similar assets or liabilities in an active market; quotations of same or similar assets or
liabilities in an active market; other observable input value other than quotations, such as interest rate and yield curves that are
observable during the normal quote interval; market-validated input value, etc.;
③ The third-level input value is the unobservable input value of the relevant assets or liabilities, including the interest rate that
cannot be directly observed or cannot be verified by observable market data, stock volatility, future cash flow of the retirement
obligation assumed in the business combination, and financial forecasting made by its own data, etc.
(5) Impairment of financial assets
On the basis of expected credit losses, the Company performs impairment treatment on financial assets measured at amortized cost
and creditors’ investment etc. measured at fair value and whose changes are included in other comprehensive income and recognize
the provisions for loss.
① Measurement of expected credit losses
Expected credit loss refers to the weighted average of credit losses of financial instruments weighted by the risk of default. Credit
loss refers to the difference between all contractual cash flows that the Company discounts at the original actual interest rate and are
receivable in accordance with contract and all cash flows expected to be received, that is, the present value of all cash shortages.
Among them, for the purchase or source of financial assets that have suffered credit impairment, the Company discounts the financial
assets at the actual interest rate adjusted by credit.
When measuring expected credit losses, the Company individually evaluates credit risk for financial assets with significantly
different credit risks, such as receivables involving litigation and arbitration with the other party, or receivables having obvious
indications that the debtor is likely to be unable to fulfill its repayment obligations, and so on.
Except for the financial assets that separately assess the credit risks, the Company classified the account receivable according to their
characteristic of risks, calculated the expected credit losses on basis of portfolio. Basis for determining the portfolio as follow:
A - Note receivable
Note receivable 1: bank acceptance
Note receivable 2: trade acceptance
B - Account receivable
Account receivable 1: receivable from clients
Account receivable 2: receivable from internal related party
C- Receivable financing
Receivable financing 1: bank acceptance
Receivable financing 2: trade acceptance
D - Other accounts receivable
Other accounts receivable 1: receivable from internal related party
Other accounts receivable 2: receivable from others
As for the note receivable, account receivable, receivable financing and other account receivable classified in portfolio, by referring
to the experience of historical credit loss, the expected credit loss is calculated by combining the current situation and the forecast of
future economic conditions.
Except for the financial assets adopting simplified metering method, the Company assesses at each balance sheet date whether its
credit risk has increased significantly since initial recognition. If credit risk has not increased significantly since initial recognition, it
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
is in the first stage, the Company measures the loss provisions based on the amount equivalent to the expected credit loss in the next
12 months; if the credit risk has increased significantly since initial recognition but no credit impairment has occurred, it is in the
second stage, the Company measures the loss provisions based on the amount equivalent to the expected credit loss for the entire
duration; if credit impairment occurs after initial recognition, it is in the third stage, the Company measures the loss provisions based
on the amount equivalent to the expected credit loss for the entire duration.For financial instruments with low credit risks at the
balance sheet date, the Company assumes that their credit risks have not increased significantly since initial recognition.
The Company evaluates the expected credit losses of financial instruments based on individual items and portfolios. When assessing
expected credit losses, the Company considers reasonable and evidence-based information about past events, current conditions, and
forecasts of future economic conditions.
When the Company no longer reasonably expects to be able to fully or partially recover the contractual cash flow of a financial asset,
the Company directly writes down the book balance of the financial asset.
② Assessment of a significant increase in credit risk:
The Company determines the relative changes in default risk of the financial instrument occurred in the expected duration and assess
whether the credit risks of financial instrument has increased significantly since the initial recognition by comparing the risk of
default of the financial instrument on the balance sheet date with the risk of default of financial instrument on the initial recognition
date. When determining whether the credit risk has increased significantly since the initial recognition, the Company considers
reasonable and evidence-based information that can be obtained without unnecessary additional costs or effort, including forward-
looking information. The information considered by the Company includes:
A. The debtor fails to pay the principal and interest according to the contractual maturity date;
B. Serious worsening of external or internal credit rating (if any) of the financial instruments that have occurred or are expected;
C. Serious deterioration of the debtor’s operating results that have occurred or are expected;
D. Changes in existing or anticipated technical, market, economic or legal circumstances that will have a material adverse effect on
the debtor's ability to repay the company.
Based on the nature of financial instruments, the Company assesses whether credit risk has increased significantly on the basis of a
single financial instrument or combination of financial instruments. When conducting an assessment based on a combination of
financial instruments, the Company can classify financial instruments based on common credit risk characteristics, such as overdue
information and credit risk ratings.
The Company believes that financial assets are subject to default in the following circumstances:
The debtor is unlikely to pay the full amount to the Company, and the assessment does not consider the Company to take recourse
actions such as realizing collateral (if held).
③ Financial assets with credit impairment
On the balance sheet date, the Company assesses whether the credit of financial assets measured at amortized cost and the credit of
debt investments measured at fair value and whose changes are included in other comprehensive income has been impaired. When
one or more events that adversely affect the expected future cash flows of a financial asset occur, the financial asset becomes a
financial asset that has suffered credit impairment. Evidence that credit impairment has occurred in financial assets includes the
following observable information:
A. The issuer or the debtor has significant financial difficulties;
B. The debtor breaches the contract such as default or overdue repayment of interest or principal;
C. The Company gives concessions to the debtor that will not be made in any other circumstances for economic or contractual
considerations relating to the financial difficulties of the debtor;
D. The debtor is likely to go bankrupt or carry out other financial restructurings;
E. The financial difficulties of the issuer or the debtor have caused the active market of the financial asset to disappear.
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
④ Presentation of expected credit loss provisions
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the Company re-measures the
expected credit losses on each balance sheet date, and the resulting increase or reversal of the loss provisions shall be included in
current profit and loss as impairment losses or gains. For financial assets measured at amortized cost, the loss provisions are written
off against the book value of the financial assets listed in the balance sheet; for debt investments measured at fair value and whose
changes are included in other comprehensive income, the Company recognizes the loss provisions in other comprehensive income
and does not deduct the book value of the financial asset.
⑤ Write-off
If the Company no longer reasonably expects that the financial asset contract cash flow can be fully or partially recovered, directly
write down the book balance of the financial asset. Such write-downs constitute the termination of recognition for related financial
assets. This usually occurs when the Company determines that the debtor has no assets or sources of income to generate sufficient
cash flow to repay the amount that will be written down. However, according to the Company's procedures for recovering the due
amount, the financial assets that have been written down may still be affected by the execution activities.
If the financial assets that have been written down are recovered afterwards, they shall be included in the profit or loss of the period
being recovered as the reversal of the impairment loss
(6) Transfer of financial assets
The transfer of financial assets refers to the transfer or delivery of financial assets to the other party (the transferee) other than the
issuer of the financial assets.
For financial assets that the Company has transferred almost all risks and rewards of ownership of financial assets to the transferee,
terminate the recognition of the financial assets; if almost all the risks and rewards of ownership of financial assets have been
retained, do not terminate the recognition of the financial assets.
If the Company has neither transferred nor retained almost all the risks and rewards of ownership of financial assets, dispose as
following situations: If the control of the financial assets is abandoned, terminate the recognition of the financial assets and determine
the resulting assets and liabilities. If the control of the financial assets is not abandoned, determine the relevant financial assets
according to the extent to which they continue to be involved in the transferred financial assets, and determine the related liabilities
accordingly.
(7) Balance-out between the financial assets and liabilities
As the Group has the legal right to balance out the financial liabilities by the net or liquidation of the financial assets, the balance-out
sum between the financial assets and liabilities is listed in the balance sheet. In addition, the financial assets and liabilities are listed
in the balance sheet without being balanced out.
11. Note receivable
Note receivable 1: bank acceptance
Note receivable 2: trade acceptance
The Company calculates expected credit losses by referring to historical credit loss experience, taking into account current conditions
and forecasts of the future economic situation.
12. Account receivable
Account receivable 1: receivable from clients
Account receivable 2: receivable from internal related party
The Company calculates expected credit losses by referring to historical credit loss experience, taking into account current conditions
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
and forecasts of the future economic situation.
13. Receivable financing
The note receivable and account receivable which are measured at fair value and whose changes are included in other comprehensive
income are classified as receivables financing within one year (including one year) from the date of acquisition. Relevant accounting
policy found more in Note V. 10. “Financial Instrument” .
14. Other accounts receivable
Determination method of expected credit loss and accounting treatment
Other accounts receivable 1: receivable from internal related party
Other accounts receivable 2: receivable from others
The Company calculates expected credit losses by referring to historical credit loss experience, taking into account current conditions
and forecasts of the future economic situation.
15. Inventory
(1) Classification of inventories
The Company’s inventories are categorized into stock materials, product in process and stock goods etc.
(2) Pricing for delivered inventories
The cost of inventory at the time of acquisition and delivery is calculated according to the standard cost method, and the difference in
cost that it should bear is carried forward at the end of the period, and the standard cost is adjusted to the actual cost.
(3) Recognition evidence for net realizable value of inventories and withdrawal method for inventory impairment provision
Inventories as at period-end are priced at the lower of costs and net realizable values; at period end, on the basis of overall clearance
about inventories, inventory impairment provision is withdrawn for uncollectible part of costs of inventories which result from
destroy of inventories, out-of-time of all and part inventories, or sales price lowering than cost. Inventory impairment provision for
stock goods and quantity of raw materials is subject to the difference between costs of single inventory item over its net realizable
value. As for other raw materials with large quantity and comparatively low unit prices, inventory impairment provision is withdrawn
pursuant to categories.
As for finished goods, commodities and materials available for direct sales, their net realizable values are determined by their
estimated selling prices less estimated sales expenses and relevant taxes. For material inventories held for purpose of production,
their net realizable values are determined by the estimated selling prices of finished products less estimated costs, estimated sales
expenses and relevant taxes accumulated till completion of production. As for inventories held for implementation of sales contracts
or service contracts, their net realizable values are calculated on the basis of contract prices. In the event that inventories held by a
company exceed order amount as agreed in sales contracts, net realizable values of the surplus part are calculated on the basis of
normal sale price.
(4) Inventory system
Perpetual Inventory System is adopted by the Company and takes a physical inventory.
(5) Amortization of low-value consumables and wrappage
① Low-value consumables
The Company adopts one-off amortization method to amortize the low-value consumables.
② Wrappage
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
The Company adopts one-off amortization method to amortize the wrappage at the time of receipt.
16. Contract assets
The Company presents the contract assets or contract liabilities in the balance sheet based on the relationship between the
performance obligation and the customer’s payment.
Recognition method and standard of contract assets: contract assets refer to the right of a company to receive consideration after
transferring goods or providing services to customers, and this right depends on other factors besides the passage of time. The
company's unconditional (that is, only depending on the passage of time) right to collect consideration from customers are separately
listed as receivables.
Method for determining expected credit losses of contract assets: the method for determining expected credit losses of contract assets
is consistent with the method for determining expected credit losses of accounts receivable.
Accounting treatment method of expected credit losses of contract assets: if the contract assets are impaired, the company shall debit
the "asset impairment loss" subject and credit the "contract asset impairment provision" subject according to the amount that should
be written down. When reversing the provision for asset impairment that has already been withdrawn, make opposite accounting
entries.
17. Assets held for sale
The Company classifies non-current assets or disposal groups that meet all of the following conditions as held-for-sale: according to
the practice of selling this type of assets or disposal groups in a similar transaction, the non-current assets or disposal group can be
sold immediately at its current condition; The sale is likely to occur, that is, the Company has made resolution on the selling plan and
obtained definite purchase commitment, the selling is estimated to be completed within one year. Those assets whose disposal is
subject to approval from relevant authority or supervisory department under relevant requirements are subject to that approval.
Where the Company loses control over its subsidiary due to disposal of investment in subsidiary, whether or not the Company retains
part equity investment after such disposal, investment in subsidiary shall be classified in its entirety as held for sale in the separate
financial statement of the parent company subject to that the investment in subsidiary proposed to be disposed satisfies the conditions
for being classified as held for sale, and all the assets and liabilities of the subsidiary shall be classified as held for sale in
consolidated financial statement.
The purchase commitment identified refers to the legally binding purchase agreement entered into between the Company and other
parties, which sets out certain major terms relating to transaction price, time and adequately stringent punishment for default, which
render an extremely minor possibility for material adjustment or revocation of the agreement.
Assets held for sale are measured at the lower of heir carrying value and fair value less selling expense. If the carrying value is higher
than fair value less selling expense, the excess shall be recognized as impairment loss and recorded in profit or loss for the period,
and allowance for impairment shall be provided for in respect of the assets. In respect of impairment loss recognized for disposal
group held for sale, carrying value of the goodwill in the disposal group shall be deducted first, and then deduct the carrying value of
the non-current assets within the disposal group applicable to this measurement standard on a pro rata basis according to the
proportion taken by their carrying value.
If the net amount of fair value of non-current assets held for sale less sales expense on subsequent balance sheet date increases, the
amount previously reduced for accounting shall be recovered and reverted from the impairment loss recognized after the asset is
classified under the category of held for sale, with the amount reverted recorded in profit or loss for the period. Impairment loss
recognized before the asset is classified under the category of held for sale shall not be reverted.If the net amount of fair value of the
disposal group held for sale on the subsequent balance sheet date less sales expenses increases, the amount reduced for accounting in
previous periods shall be restored, and shall be reverted in the impairment loss recognized in respect of the non-current assets which
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
are applicable to relevant measurement provisions after classification into the category of held for sale, with the reverted amount
charged in profit or loss for the current period. The written-off carrying value of goodwill shall not be reverted.
The non-current assets in the non-current assets or disposal group held for sale is not depreciated or amortized, and the debt interests
and other fees in the disposal group held for sale continue to be recognized.
If the non-current assets or disposal group are no longer classified as held for sale since they no longer meet the condition of being
classified as held for sale or the non-current assets are removed from the disposal group held for sale, they will be measured at the
lower of the following:
(i)The amount after their book value before they are classified as held for sale is adjusted based on the depreciation, amortization or
impairment that should have been recognized given they are not classified as held for sale;
(ii) The recoverable amount.
18. Long-term equity investment
Long-term equity investments refer to long-term equity investments in which the Company has control, joint control or significant
influence over the invested party. Long-term equity investment without control or joint control or significant influence of the Group
is accounted for as available-for-sale financial assets or financial assets measured by fair value and with variation reckoned into
current gains/losses. As for other accounting policies found more in Note V.10. “Financial instrument” .
(1) Determination of initial investment cost
Investment costs of the long-term equity investment are recognized by the follow according to different way of acquirement:
① For a long-term equity investment acquired through a business combination involving enterprises under common control, the
initial investment cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount of the owner’s
equity under the consolidated financial statements of the ultimate controlling party on the date of combination. The difference
between the initial cost of the long-term equity investment and the cash paid, non-cash assets transferred as well as the book value of
the debts borne by the absorbing party shall offset against the capital reserve. If the capital reserve is insufficient to offset, the
retained earnings shall be adjusted. If the consideration of the merger is satisfied by issue of equity securities, the initial investment
cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount of the owner’s equity under the
consolidated financial statements of the ultimate controlling party on the date of combination. With the total face value of the shares
issued as share capital, the difference between the initial cost of the long-term equity investment and total face value of the shares
issued shall be used to offset against the capital reserve. If the capital reserve is insufficient to offset, the retained earnings shall be
adjusted. For business combination resulted in an enterprise under common control by acquiring equity of the absorbing party under
common control through a stage-up approach with several transactions, these transactions will be judged whether they shall be treat
as “transactions in a basket”. If they belong to “transactions in a basket”, these transactions will be accounted for a transaction in
obtaining control. If they do not belong to “transactions in a basket”, the initial investment cost of the long-term equity investment
shall be the absorbing party’s share of the carrying amount of the owner’s equity under the consolidated financial statements of the
ultimate controlling party on the date of combination. The difference between the initial cost of the long-term equity investment and
the aggregate of the carrying amount of the long-term equity investment before merging and the carrying amount the additional
consideration paid for further share acquisition on the date of combination shall offset against the capital reserve. If the capital
reserve is insufficient to offset, the retained earnings shall be adjusted. Other comprehensive income recognized as a result of the
previously held equity investment accounted for using equity method on the date of combination or recognized for available-for-sale
financial assets will not be accounted for.
② For the long-term equity investment obtained by business combination not under the same control, the fair value of the assets
involved, the equity instruments issued and the liabilities incurred or assumed on the transaction date, plus the combined cost directly
related to the acquisition is used as the initial investment cost of the long-term equity investment. The identifiable assets of the
combined party and the liabilities (including contingent liabilities) assumed by the combined party on the combining date are all
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
measured at fair value, regardless of the amount of minority shareholders’ equity. The amount of the combined cost exceeding the
fair value of the identifiable net assets of the combined party obtained by the Company is recorded as goodwill, and the amount
below the fair value of the identifiable net assets of the combining party is directly recognized in the consolidated income
statement.(For business combination resulted in an enterprise not under common control by acquiring equity of the acquire under
common control through a stage-up approach with several transactions, these transactions will be judged whether they shall be treat
as “transactions in a basket”. If they belong to “transactions in a basket”, these transactions will be accounted for a transaction in
obtaining control. If they do not belong to “transactions in a basket”, the initial investment cost of the long-term equity investment
accounted for using cost method shall be the aggregate of the carrying amount of equity investment previously held by the acquire
and the additional investment cost. For previously held equity accounted for using equity method, relevant other comprehensive
income will not be accounted for. For previously held equity investment classified as available-for-sale financial asset, the difference
between its fair value and carrying amount, as well as the accumulated movement in fair value previously included in the other
comprehensive income shall be transferred to profit or loss for the current period.)
③ Long-term investments obtained through other ways:
A. Initial investment cost of long-term equity investment obtained through cash payment is determined according to actual payment
for purchase;
B. Initial investment cost of long-term equity investment obtained through issuance of equity securities is determined at fair value of
such securities;
C. Initial investment cost of long-term equity investment (exchanged-in) obtained through exchange with non-monetary assets, which
is of commercial nature, is determined at fair value of the assets exchanged-out; otherwise determined at carrying value of the assets
exchanged-out if it is not of commercial nature;
D. Initial investment cost of long-term equity investment obtained through debt reorganization is determined at fair value of such
investment.
(2) Subsequent measurement on long-term equity investment
① Presented controlling ability on invested party, the investment shall use cost method for measurement.
② Long-term equity investments with joint control (excluding those constitute joint ventures) or significant influence on the invested
party are accounted for using equity method.
Under the equity method, where the initial investment cost of a long-term equity investment exceeds the investor’s interest in the fair
value of the invested party’s identifiable net assets at the acquisition date, no adjustment shall be made to the initial investment cost.
Where the initial investment cost is less than the investor’s interest in the fair value of the invested party’s identifiable net assets at
the acquisition date, the difference shall be charged to profit or loss for the current period, and the cost of the long term equity
investment shall be adjusted accordingly.
Under the equity method, investment gain and other comprehensive income shall be recognized based on the Group’s share of the net
profits or losses and other comprehensive income made by the invested party, respectively. Meanwhile, the carrying amount of long-
term equity investment shall be adjusted. The carrying amount of long-term equity investment shall be reduced based on the Group’s
share of profit or cash dividend distributed by the invested party. In respect of the other movement of net profit or loss, other
comprehensive income and profit distribution of invested party, the carrying value of long-term equity investment shall be adjusted
and included in the capital reserves. The Group shall recognize its share of the invested party’s net profits or losses based on the fair
values of the invested party’s individual separately identifiable assets at the time of acquisition, after making appropriate adjustments
thereto. In the event of in-conformity between the accounting policies and accounting periods of the invested party and the Company,
the financial statements of the invested party shall be adjusted in conformity with the accounting policies and accounting periods of
the Company. Investment gain and other comprehensive income shall be recognized accordingly. In respect of the transactions
between the Group and its associates and joint ventures in which the assets disposed of or sold are not classified as operation, the
share of unrealized gain or loss arising from inter-group transactions shall be eliminated by the portion attributable to the Company.
Investment gain shall be recognized accordingly. However, any unrealized loss arising from inter-group transactions between the
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Group and an invested party is not eliminated to the extent that the loss is impairment loss of the transferred assets. In the event that
the Group disposed of an asset classified as operation to its joint ventures or associates, which resulted in acquisition of long-term
equity investment by the investor without obtaining control, the initial investment cost of additional long-term equity investment
shall be the fair value of disposed operation. The difference between initial investment cost and the carrying value of disposed
operation will be fully included in profit or loss for the current period. In the event that the Group sold an asset classified as operation
to its associates or joint ventures, the difference between the carrying value of consideration received and operation shall be fully
included in profit or loss for the current period. In the event that the Company acquired an asset which formed an operation from its
associates or joint ventures, relevant transaction shall be accounted for in accordance with “Accounting Standards for Business
Enterprises No. 20 “Business combination”. All profit or loss related to the transaction shall be accounted for.
The Group’s share of net losses of the invested party shall be recognized to the extent that the carrying amount of the long-term
equity investment together with any long-term interests that in substance form part of the investor’s net investment in the invested
party are reduced to zero. If the Group has to assume additional obligations, the estimated obligation assumed shall be provided for
and charged to the profit or loss as investment loss for the period. Where the invested party is making profits in subsequent periods,
the Group shall resume recognizing its share of profits after setting off against the share of unrecognized losses.
③ Acquisition of minority interest
Upon the preparation of the consolidated financial statements, since acquisition of minority interest increased of long-term equity
investment which was compared to fair value of identifiable net assets recognized which are measured based on the continuous
measurement since the acquisition date (or combination date) of subsidiaries attributable to the Group calculated according to the
proportion of newly acquired shares, the difference of which recognized as adjusted capital surplus, capital surplus insufficient to set
off impairment and adjusted retained earnings.
④ Disposal of long-term equity investments
In these consolidated financial statements, for disposal of a portion of the long-term equity investments in a subsidiary without loss
of control, the difference between disposal cost and disposal of long-term equity investments relative to the net assets of the
subsidiary is charged to the owners’ equity. If disposal of a portion of the long-term equity investments in a subsidiary by the parent
company results in a change in control, it shall be accounted for in accordance with the relevant accounting policies as described in
Note V-6 “Preparation Method of the Consolidated Financial Statements”.
On disposal of a long-term equity investment otherwise, the difference between the carrying amount of the investment and the actual
consideration paid is recognized through profit or loss in the current period.
In respect of long-term equity investment accounted for using equity method with the remaining equity interest after disposal also
accounted for using equity method, other comprehensive income previously under owners’ equity shall be accounted for in
accordance with the same accounting treatment for direct disposal of relevant asset or liability by invested party on pro rata basis at
the time of disposal. The owners’ equity recognized for the movement of other owners’ equity (excluding net profit or loss, other
comprehensive income and profit distribution of invested party) shall be transferred to profit or loss for the current period on pro rata
basis.
In respect of long-term equity investment accounted for using cost method with the remaining equity interest after disposal also
accounted for cost equity method, other comprehensive income measured and reckoned under equity method or financial instrument
before control of the invested party unit acquired shall be accounted for in accordance with the same accounting treatment for direct
disposal of relevant asset or liability by invested party on pro rata basis at the time of disposal and shall be transferred to profit or loss
for the current period on pro rata basis; among the net assets of invested party unit recognized by equity method (excluding net profit
or loss, other comprehensive income and profit distribution of invested party) shall be transferred to profit or loss for the current
period on pro rata basis.
In the event of loss of control over invested party due to partial disposal of equity investment by the Group, in preparing separate
financial statements, the remaining equity interest which can apply common control or impose significant influence over the invested
party after disposal shall be accounted for using equity method. Such remaining equity interest shall be treated as accounting for
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
using equity method since it is obtained and adjustment was made accordingly. For remaining equity interest which cannot apply
common control or impose significant influence over the invested party after disposal, it shall be accounted for using the recognition
and measurement standard of financial instruments. The difference between its fair value and carrying amount as at the date of losing
control shall be included in profit or loss for the current period. In respect of other comprehensive income recognized using equity
method or the recognition and measurement standard of financial instruments before the Group obtained control over the invested
party, it shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant asset or liability by
invested party at the time when the control over invested party is lost. Movement of other owners’ equity (excluding net profit or loss,
other comprehensive income and profit distribution under net asset of invested party accounted for and recognized using equity
method) shall be transferred to profit or loss for the current period at the time when the control over invested party is lost. Of which,
for the remaining equity interest after disposal accounted for using equity method, other comprehensive income and other owners’
equity shall be transferred on pro rata basis. For the remaining equity interest after disposal accounted for using the recognition and
measurement standard of financial instruments, other comprehensive income and other owners’ equity shall be fully transferred.
In the event of loss of common control or significant influence over invested party due to partial disposal of equity investment by the
Group, the remaining equity interest after disposal shall be accounted for using the recognition and measurement standard of
financial instruments. The difference between its fair value and carrying amount as at the date of losing common control or
significant influence shall be included in profit or loss for the current period. In respect of other comprehensive income recognized
under previous equity investment using equity method, it shall be accounted for in accordance with the same accounting treatment
for direct disposal of relevant asset or liability by invested party at the time when equity method was ceased to be used. Movement of
other owners’ equity (excluding net profit or loss, other comprehensive income and profit distribution under net asset of invested
party accounted for and recognized using equity method) shall be transferred to profit or loss for the current period at the time when
equity method was ceased to be used.
The Group disposes its equity investment in subsidiary by a stage-up approach with several transactions until the control over the
subsidiary is lost. If the said transactions belong to “transactions in a basket”, each transaction shall be accounted for as a single
transaction of disposing equity investment of subsidiary and loss of control. The difference between the disposal consideration for
each transaction and the carrying amount of the corresponding long-term equity investment of disposed equity interest before loss of
control shall initially recognized as other comprehensive income, and subsequently transferred to profit or loss arising from loss of
control for the current period upon loss of control.
(3) Impairment test method and withdrawal method for impairment provision
Found more in Note V.25. “Impairment of long-term assets”
(4) Criteria of joint control and significant influence
Joint control is the Company’s contractually agreed sharing of control over an arrangement, which relevant activities of such
arrangement must be decided by unanimously agreement from parties who share control. All the participants or participant group
whether have controlling over such arrangement as a group or not shall be judge firstly, than judge that whether the decision-making
for such arrangement are agreed unanimity by the participants or not.
Significant influence is the power of the Company to participate in the financial and operating policy decisions of an invested party,
but to fail to control or joint control the formulation of such policies together with other parties. While recognizing whether have
significant influence by invested party, the potential factors of voting power as current convertible bonds and current executable
warrant of the invested party held by investors and other parties shall be thank over.
19. Investment real estate
Measurement model of investment real estate
Cost measurement
Depreciation or amortization
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Investment real estate is stated at cost. During which, the cost of externally purchased properties held-for-investment includes
purchasing price, relevant taxes and surcharges and other expenses which are directly attributable to the asset. Cost of self
construction of properties held for investment is composed of necessary expenses occurred for constructing those assets to a state
expected to be available for use. Properties held for investment by investors are stated at the value agreed in an investment contract
or agreement, but those under contract or agreement without fair value are stated at fair value.
The Company adopts cost methodology amid subsequent measurement of properties held for investment, while depreciation and
amortization is calculated using the straight-line method according to their estimated useful lives.
The basis of provision for impairment of properties held for investment is referred to Note V. 25. “Impairment of long-term assets”
20. Fixed assets
(1) Recognition conditions
Fixed assets refer to the tangible assets for production of products, provision of labor, lease or operation, with a service life excess
one year and has more unit value.
(2) Depreciation methods
Category Depreciation method Years of depreciation Scrap value rate Yearly depreciation rate
House and Building Straight-line depreciation 20~35 5 2.71~4.75
Machinery equipment Straight-line depreciation 10 5 9.50
Transportation equipment Straight-line depreciation 4~5 5 19.00~23.75
Electronic and other equipment Straight-line depreciation 3～10 5 9.50～31.67
For the fixed assets with impairment provision, the depreciation amount shall be calculated after deducting the accumulated amount
of impairment provision for fixed assets
(3) Recognition basis, valuation and depreciation method for financial lease assets
The Company affirms those that conform to below one or several criteria as the finance lease fixed assets:
① Agreed in the lease contract (or made a reasonable judgment according to the correlated conditions on the lease commencement
date), the ownership of lease fixed assets can be transferred to the Company after the expiry of the lease period;
② The Company has the option to purchase or lease the fixed assets, and the purchase price is estimated to be much less than the fair
value of the lease of fixed assets when exercises the options, so whether the Company will exercise the option can be reasonably
determined on the lease commencement date;
③ Even though the fixed asset ownership is not transferred, the lease term accounts for 75% of the service life of the lease fixed
assets;
④ The present value of the Company’s of minimum lease payment on the lease commencement date is equivalent to 90% or more of
the fair value of the lease fixed assets on the lease commencement date; the present value of the leaser’s of minimum lease payment
on the lease commencement date is equivalent to 90% or more of the fair value of the lease fixed assets on the lease commencement
date;
⑤ The leased assets with special properties can only be used by the Company without major modifications. The fixed assets rented
by finance leases is calculated as the book value according to the lower one between the fair value of leased assets on the lease
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
commencement date and the present value of the minimum lease payments.
(4) The impairment test method and provision for impairment of fixed assets
The impairment test method and provision for impairment of fixed assets found more in Note V. 25. “Impairment of long-term
assets”.
21. Construction in progress
From the date on which the fixed assets built by the Company come into an expected usable state, the construction in progress are
converted into fixed assets on the basis of the estimated value of project estimates or pricing or project actual costs, etc. Depreciation
is calculated from the next month. Further adjustments are made to the difference of the original value of fixed assets after final
accounting is completed upon completion of projects.
The basis of provision for impairment of properties held for construction in process is referred to Note V-“25. Impairment of long-
term assets”
22. Borrowing costs
(1) Recognition of capitalization of borrowing costs
Borrowing costs comprise interest occurred, amortization of discounts or premiums, ancillary costs and exchange differences in
connection with foreign currency borrowings. The borrowing costs of the Company, which incur from the special borrowings
occupied by the fixed assets that need more than one year (inclusive) for construction, development of investment properties or
inventories or from general borrowings, are capitalized and recorded in relevant assets costs; other borrowing costs are recognized as
expenses and recorded in the profit or loss in the period when they are occurred. Relevant borrowing costs start to be capitalized
when all of the following three conditions are met:
① Capital expenditure has been occurred;
② Borrowing costs have been occurred;
③ Acquisition or construction necessary for the assets to come into an expected usable state has been carried out.
(2) Period of capitalization of borrowing costs
Borrowing costs arising from purchasing fixed asset, investment real estate and inventory, and occurred after such assets reached to
its intended use of status or sales, than reckoned into assets costs while satisfy the above mentioned capitalization condition;
capitalization of borrowing costs shall be suspended and recognized as current expenditure during periods in which construction of
fixed assets, investment real estate and inventory are interrupted abnormally, when the interruption is for a continuous period of more
than 3 months, until the acquisition, construction or production of the qualifying asset is resumed; capitalization shall discontinue
when the qualifying asset is ready for its intended use or sale, the borrowing costs occurred subsequently shall reckoned into
financial expenses while occurring for the current period.
(3) Measure of capitalization for borrowing cost
In respect of the special borrowings borrowed for acquisition, construction or production and development of the assets qualified for
capitalization, the amount of interests expenses of the special borrowings actually occurred in the period less interest income derived
from unused borrowings deposited in banks or less investment income derived from provisional investment, are recognized.
With respect to the general borrowings occupied for acquisition, construction or production and development of the assets qualified
for capitalization, the capitalized interest amount for general borrowings is calculated and recognized by multiplying a weighted
average of the accumulated expenditure on the assets in excess of the expenditure on some assets of the special borrowings, by a
capitalization rate for general borrowings. The capitalization rate is determined by calculation of the weighted average interest rate of
the general borrowings.
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
23. Right-of-use assets
The right-of-use asset refers to the right of the Company, as the lessee, to use the leased asset during the lease term.
On the commencement date of the lease term, the Company recognizes the right-of-use assets for leases other than short-term leases
and leases of low-value assets. Right-of-use assets are initially measured at cost. The cost includes the initial measurement amount of
the lease liability; the lease payments made on or before the commencement date of the lease term, deduct the relevant amount of the
lease incentive already enjoyed if there is a lease incentive; the initial direct expenses incurred by the lessee; the cost expected to be
incurred by the lessee to dismantle and remove the leased assets, restore the site where the leased assets locate, or restore the leased
assets to the condition agreed upon in the lease terms, but this does not include the cost attributable to the production of inventory.
The Company subsequently uses the straight-line method to depreciate the right-of-use assets. If it can be reasonably determined that
the ownership of the leased asset can be obtained at the expiration of the lease term, the Company shall accrue depreciation over the
remaining useful life of the leased asset. If it cannot be reasonably determined that the ownership of the leased asset can be obtained
at the expiration of the lease term, the Company shall accrue depreciation within the shorter of the lease term and the remaining
useful life of the leased asset. When the recoverable amount is lower than the book value of the right-of-use asset, the Company shall
write down its book value to the recoverable amount.
24. Intangible assets
(1) Measurement, use of life and impairment testing
① Measurement of intangible assets
The intangible assets of the Company include land use rights, patented technology and non-patents technology etc.
The cost of a purchased intangible asset shall be determined by the expenditure actually occurred and other related costs.
The cost of an intangible asset contributed by an investor shall be determined in accordance with the value stipulated in the
investment contract or agreement, except where the value stipulated in the contract or agreement is not fair.
The intangible assets acquired through exchange of non-monetary assets, which is commercial in substance, is carried at the fair
value of the assets exchanged out; for those not commercial in substance, they are carried at the carrying amount of the assets
exchanged out.
The intangible assets acquired through debt reorganization are recognized at the fair value.
② Amortization methods and time limit for intangible assets:
Land use right of the company had average amortization by the transfer years from the beginning date of transfer (date of getting land
use light); Patented technology, non-patented technology and other intangible assets of the Company are amortized by straight-line
method with the shortest terms among expected useful life, benefit years regulated in the contract and effective age regulated by the
laws. The amortization amount shall count in relevant assets costs and current gains/losses according to the benefit object.
As for the intangible assets such as trademark, with uncertain benefit terms, amortization shall not be carried.
Impairment testing methods and accrual for depreciation reserves for the intangible assets found more in Note V. 25. “Impairment of
long-term assets”.
(2) Internal accounting policies relating to research and development expenditures
Expenses incurred during the research phase are recognized as profit or loss in the current period; expenses incurred during the
development phase that satisfy the following conditions are recognized as intangible assets (patented technology and non-patents
technology):
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
① It is technically feasible that the intangible asset can be used or sold upon completion;
② There is intention to complete the intangible asset for use or sale;
③ The products produced using the intangible asset has a market or the intangible asset itself has a market;
④ There is sufficient support in terms of technology, financial resources and other resources in order to complete the development of
the intangible asset, and there is capability to use or sell the intangible asset;
⑤ The expenses attributable to the development phase of the intangible asset can be measured reliably.
If the expenses incurred during the development phase did not qualify the above mentioned conditions, such expenses incurred are
accounted for in the profit or loss for the current period. The development expenditure reckoned in gains/losses previously shall not
be recognized as assets in later period. The capitalized expenses in development stage listed as development expenditure in balance
sheet, and shall be transfer as intangible assets since such item reached its expected conditions for service.
25. Impairment of long-term assets
The Company will judge if there is any indication of impairment as at the balance sheet date in respect of non-current non-financial
assets such as fixed assets, construction in progress, intangible assets with a finite useful life, investment properties measured at cost,
and long-term equity investments in subsidiaries, joint controlled entities and associates. If there is any evidence indicating that an
asset may be impaired, recoverable amount shall be estimated for impairment test. Goodwill, intangible assets with an indefinite
useful life and intangible assets beyond working conditions will be tested for impairment annually, regardless of whether there is any
indication of impairment.
If the impairment test result shows that the recoverable amount of an asset is less than its carrying amount, the impairment provision
will be made according to the difference and recognized as an impairment loss. The recoverable amount of an asset is the higher of
its fair value less costs of disposal and the present value of the future cash flows expected to be derived from the asset. An asset’s fair
value is the price in a sale agreement in an arm’s length transaction. If there is no sale agreement but the asset is traded in an active
market, fair value shall be determined based on the bid price. If there is neither sale agreement nor active market for an asset, fair
value shall be based on the best available information. Costs of disposal are expenses attributable to disposal of the asset, including
legal fee, relevant tax and surcharges, transportation fee and direct expenses incurred to prepare the asset for its intended sale. The
present value of the future cash flows expected to be derived from the asset over the course of continued use and final disposal is
determined as the amount discounted using an appropriately selected discount rate. Provisions for assets impairment shall be made
and recognized for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the Group shall
determine the recoverable amount of the asset group to which the asset belongs. The asset group is the smallest group of assets
capable of generating cash flows independently.
For the purpose of impairment testing, the carrying amount of goodwill presented separately in the financial statements shall be
allocated to the asset groups or group of assets benefiting from synergy of business combination. If the recoverable amount is less
than the carrying amount, the Group shall recognize an impairment loss. The amount of impairment loss shall first reduce the
carrying amount of any goodwill allocated to the asset group or set of asset groups, and then reduce the carrying amount of other
assets (other than goodwill) within the asset group or set of asset groups, pro rata on the basis of the carrying amount of each asset.
An impairment loss recognized on the aforesaid assets shall not be reversed in a subsequent period in respect of the part whose value
can be recovered.
26. Long-term deferred expenses
Long-term expenses to be amortized of the Company which are the expenses that are already charged and with the beneficial term of
more than one year shall be evenly amortized over the beneficial term. For the long-term deferred expense items cannot benefit the
subsequent accounting periods, the amortized value of such items is all recorded in the profit or loss during recognition.
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
27. Contract liability
The Company lists the obligation to transfer goods or provide labor services to customers for the consideration received or receivable
from customers as contractual liabilities, such as the amount that the company has received before the transfer of the promissory
goods.
28. Employee compensation
(1) Accounting treatment for short-term compensation
During the accounting period when the staff providing service to the Company, the short-term remuneration actual occurred shall
recognized as liability and reckoned into current gains/losses. During the accounting period when staff providing service to the
Company, the actual short-term compensation occurred shall recognized as liabilities and reckoned into current gains/losses, except
for those in line with accounting standards or allow to reckoned into capital costs; the welfare occurred shall reckoned into current
gains/losses or relevant asset costs while actually occurred. The employee compensation shall recognize as liabilities and reckoned
into current gains/losses or relevant assets costs while actually occurred. The employee benefits that belong to non-monetary benefits
are measured in accordance with the fair value; the social insurances including the medical insurance, work-injury insurance and
maternity insurance and the housing fund that the enterprise pays for the employees as well as the labor union expenditure and
employee education funds withdrawn by rule should be calculated and determined as the corresponding compensation amount and
determined the corresponding liabilities in accordance with the specified withdrawing basis and proportion, and reckoned in the
current profits and losses or relevant asset costs in the accounting period that the employees provide services.
(2) Accounting treatment for post-employment benefit
The post-employment benefit included the defined contribution plans and defined benefit plans. Post-employment benefits plan
refers to the agreement about the post-employment benefits between the enterprise and employees, or the regulations or measures the
enterprise established for providing post-employment benefits to employees. Thereinto, the defined contribution plan refers to the
post-employment benefits plan that the enterprise doesn’t undertake the obligation of payment after depositing the fixed charges to
the independent fund; the defined benefit plans refers to post-employment benefits plans except the defined contribution plan.
(3) Accounting treatment for retirement benefits
When the Company terminates the employment relationship with employees before the end of the employment contracts or provides
compensation as an offer to encourage employees to accept voluntary redundancy, the Company shall recognize employee
compensation liabilities arising from compensation for staff dismissal and included in profit or loss for the current period, when the
Company cannot revoke unilaterally compensation for dismissal due to the cancellation of labor relationship plans and employee
redundant proposals; and the Company recognize cost and expenses related to payment of compensation for dismissal and
restructuring, whichever is earlier.The early retirement plan shall be accounted for in accordance with the accounting principles for
compensation for termination of employment. The salaries or wages and the social contributions to be paid for the employees who
retire before schedule from the date on which the employees stop rendering services to the scheduled retirement date, shall be
recognized (as compensation for termination of employment) in the current profit or loss by the Group if the recognition principles
for provisions are satisfied.
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(4) Accounting treatment for other long-term employee benefits
Except for the compulsory insurance, the Company provides the supplementary retirement benefits to the employees satisfying some
conditions, the supplementary retirement benefits belong to the defined benefit plans, and the defined benefitliability confirmed on
the balance sheet is the value by subtracting the fair value of plan assets from the present value of defined benefit obligation. The
defined benefit obligation is annually calculated in accordance with the expected accumulated welfare unit method by the
independent actuary by adopting the treasury bond rate with similar obligation term and currency. The service charges related to the
supplementary retirement benefits (including the service costs of the current period, the previous service costs, and the settlement
gains or losses) and the net interest are reckoned in the current profits and losses or other asset costs, the changes generated by
recalculating the net liabilities of defined benefit plans or net assets should be reckoned in other consolidated income.
29. Lease liability
On the commencement date of the lease term, the Company recognizes the present value of the unpaid lease payments as lease
liabilities. Lease payments include the following five items: fixed payments and in-substance fixed payments, if there is a lease
incentive, deduct the amount related to the lease incentive; variable lease payments that depend on an index or ratio, which are
determined at the initial measurement according to the index or ratio determination on the commencement date of lease term;
exercise price for a purchase option provided that the lessee is reasonably certain that the option shall be exercised; payments for
exercising the option to terminate the lease provided that the lease term reflects that the lessee shall exercise the option to terminate
the lease option; estimated payments due based on guaranteed residual value provided by the lessee.
When calculating the present value of lease payments, the interest rate implicit in the lease is used as the discount rate. If the interest
rate implicit in the lease cannot be determined, the company’s incremental borrowing rate is used as the discount rate. The Company
calculates the interest expense of the lease liability in each period of the lease term according to the fixed periodic interest rate, and
includes it in the current profit and loss, unless it is otherwise stipulated to be included in the cost of the relevant assets. Variable
lease payments that are not included in the measurement of lease liabilities are included in the current profit and loss when they are
actually incurred, unless otherwise stipulated to be included in the cost of the relevant assets. After the commencement date of the
lease term, when there is a change in the in-substance fixed payment, or a change in the estimated amount payable for the guaranteed
residual value, or a change in the index or ratio used to determine the lease payment, or a change in the evaluation results of the
purchase option, renewal option or termination option or when the actual exercise situation changes, the Company shall re-measure
the lease liability according to the present value of the changed lease payments.
30. Accrual liability
(1) Recognition principle
An obligation related to a contingency, such as guarantees provided to outsiders, pending litigation or arbitration, product warranties,
redundancy plans, onerous contracts, reconstructing, expected disposal of fixed assets, etc. shall be recognized as an estimated
liability when all of the following conditions are satisfied:
① The obligation is a present obligation of the Company;
② To settle the obligation may be likely to result in an outflow of economic benefits;
③ The amount of the obligation can be measured reliably.
(2) Measurement method: Measure on the basis of the best estimates of the expenses necessary for paying off the contingencies
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
31. Share-based payment
The Company’s share-based payment is a transaction that grants equity instruments or assumes liabilities determined on the basis of
equity instruments in order to obtain services provided by employees or other parties. The Company’s share-based payment is
classified as equity-settled share-based payment and cash-settled share-based payment.
(1) Equity-settled share-based payment and equity instruments
Equity-settled share-based payment in exchange for services provided by employees shall be measured at the fair value of the equity
instruments granted to employees. If the Company uses restricted stocks for share-based payment, employees contribute capital to
subscribe for stocks, and the stocks shall not be listed for circulation or transfer until the unlocking conditions are met and unlocked;
if the unlocking conditions specified in the final equity incentive plan are not met, the Company shall repurchase the stocks at the
pre-agreed price. When the Company obtains the payment for the employees to subscribe for restricted stocks, it shall confirm the
share capital and capital reserve (share capital premium) according to the obtained subscription money, and at the same time
recognize a liability in full for the repurchase obligation and recognize treasury shares. On each balance sheet date during the waiting
period, the Company makes the best estimate of the number of vesting equity instruments based on the changes in the latest obtained
number of vested employees, whether they meet the specified performance conditions, and other follow-up information. On this basis,
the services obtained in the current period are included in related costs or expenses based on the fair value on the grant date, and the
capital reserve shall be increased accordingly.
For share-based payments that cannot be vested in the end, costs or expenses shall not be recognized, unless the vesting conditions
are market conditions or non-vesting conditions. At this time, regardless of whether the market conditions or the non-vesting
conditions are met, as long as all non-market conditions in the vesting conditions are met, it is deemed as vesting.
If the terms of equity-settled share-based payment are modified, at least the services obtained should be confirmed in accordance
with the unmodified terms. In addition, any modification that increases the fair value of the equity instruments granted, or a change
that is beneficial to employees on the modification date, is recognized as an increase in services received.
If the equity-settled share payment is canceled, it will be treated as an accelerated vesting on the cancellation day, and the
unconfirmed amount will be confirmed immediately. If an employee or other party can choose to meet the non-vesting conditions but
fails to meet within the waiting period, it shall be treated as cancellation of equity-settled share-based payment. However, if a new
equity instrument is granted and it is determined on the date of grant of the new equity instrument that the new equity instrument
granted is used to replace the canceled equity instrument, the granted substitute equity instruments shall be treated in the same way as
the modification of the original equity instrument terms and conditions.
(2) Cash-settled share-based payment and equity instruments
Cash-settled share-based payments are measured at the fair value of the liabilities calculated and determined on the basis of shares or
other equity instruments undertaken by the Company. If it’s vested immediately after the grant, the fair value of the liabilities
assumed on the date of the grant is included in the cost or expense, and the liability is increased accordingly. If the service within the
waiting period is completed or the specified performance conditions are met, the service obtained in the current period shall be
included in the relevant costs or expenses based on the best estimate of the vesting situation within the waiting period and the fair
value of the liabilities assumed to increase the corresponding liabilities. On each balance sheet date and settlement date before the
settlement of the relevant liabilities, the fair value of the liabilities is remeasured, and the changes are included in the current profit
and loss.
32. Revenue
Accounting policies used in revenue recognition and measurement
1)Revenue recognition principle
On the starting date of the contract, the company evaluates the contract, identifies each individual performance obligation contained
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
in the contract, and determines whether each individual performance obligation is performed within a certain period of time or at a
certain point in time.
When one of the following conditions is met, it belongs to the performance obligation within a certain period of time, otherwise, it
belongs to the performance obligation at a certain point in time: ① The customer obtains and consumes the economic benefits
brought by the company's performance while the company performs the contract; ② The customer can control the goods or services
in progress during the company’s performance; ③The goods or services produced during the company’s performance have
irreplaceable uses, and the company has the right to collect payment for the performance part that has been completed so far during
the entire contract period.
For performance obligations performed within a certain period of time, the company recognizes revenue in accordance with the
performance progress during that period. When the performance progress cannot be reasonably determined, if the cost incurred is
expected to be compensated, the revenue shall be recognized according to the amount of the cost incurred until the performance
progress can be reasonably determined. For performance obligations performed at a certain point in time, revenue is recognized at the
point when the customer obtains control of the relevant goods or services. When judging whether the customer has obtained control
of the goods, the company considers the following signs:① The company has the current right to receive payment for the goods, that
is, the customer has the current payment obligation for the goods; ② The company has transferred the legal ownership of the goods
to the customer, that is, the customer has the legal ownership of the goods; ③ The company has transferred the goods to the customer
in kind, that is, the customer has physically taken possession of the goods; ④ The company has transferred the main risks and
rewards of the ownership of the goods to the customer, that is, the customer has obtained the main risks and rewards of the ownership
of the goods; ⑤ The customer has accepted the goods; ⑥ Other signs that the customer has obtained control of the goods.
2)Revenue measurement principle
① The company measures revenue based on the transaction price allocated to each individual performance obligation. The
transaction price is the amount of consideration that the company expects to be entitled to receive due to the transfer of goods or
services to customers, and does not include payments collected on behalf of third parties and payments expected to be returned to
customers.
② If there is variable consideration in the contract, the company shall determine the best estimate of the variable consideration
according to the expected value or the most likely amount, but the transaction price including the variable consideration shall not
exceed the amount of cumulatively recognized revenue that is unlikely to be significantly turned back when the relevant uncertainty
is eliminated.
③ If there is a significant financing component in the contract, the company shall determine the transaction price based on the
amount payable that the customer is assumed to pay in cash when obtaining the control of the goods or services. The difference
between the transaction price and the contract consideration shall be amortized by the effective interest method during the contract
period. On the starting date of the contract, if the company expects that the customer pays the price within one year after obtaining
control of the goods or services, the significant financing components in the contract shall not be considered.
④ If the contract contains two or more performance obligations, the company will allocate the transaction price to each individual
performance obligation based on the relative proportion of the stand-alone selling price of the goods promised by each individual
performance obligation on the starting date of the contract.
(2) The criteria for the recognition of revenue recognition from sales of goods and the specific criteria for the recognition time:
Time point for recognition of the company’s domestic sales revenue: the company delivers goods as agreed in the order, checks the
goods received and inspected by the buyer during the period from the previous reconciliation date to this reconciliation date with the
buyer on the reconciliation date agreed with the buyer, after which the risks and rewards are transferred to the buyer. The company
issues invoices to the buyer according to the types, quantities and amounts confirmed in the reconciliation, and recognizes the
realization of sales revenue on the reconciliation date.
Time point for recognition of the Company’s foreign sales Revenue recognition: after the customs review is completed, the Company
will recognize the realization of sales revenue according to the export date specified in the Customs declaration.
Differences in accounting policies for revenue recognition due to different operating models for the same type of business
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
N/A
33. Government grants
(1) Types
Government grants are transfer of monetary assets or non-monetary assets from the government to the Group at no consideration.
Government grants are classified into government grants related to assets and government grants related to income.
As for the assistance object not well-defined in government’s documents, the classification criteria for assets-related or income-
related grants are as: whether the grants turn to long-term assets due to purchasing for construction or other means.
(2) Recognition and measurement
The government grants shall be recognized while the additional conditions of the grants are satisfied and amount is actually can be
obtained.
If a government grant is in the form of a transfer of monetary asset, the item shall be measured at the amount received or receivable.
If a government grant is in the form of a transfer of non-monetary asset, the item shall be measured at fair value. If the fair value can
not be reliably acquired, then measured by nominal amount.
(3) Accounting treatment
Asset-related government grant shall be recognized as deferred income, and reckoned into current gains/losses according to the
depreciation process in use life of such assets.
The income-related government grant which is used to make up relevant expenses and losses for later period will be recognized as
deferred income, and should reckoned into current gain/loss during the period while relevant expenses are recognized; The income-
related government grant which is used to make up relevant expenses and losses that have occurred should be reckoned into current
gains/losses.
The government grant related to daily operation activity of the Company should be reckoned into other income; The government
grant not related to daily operation activity should be reckoned into non-operation income and expenses.
The financial discount funds received by the Company shall write down relevant borrowing costs.
34. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets or deferred income tax liabilities are realized based on the difference between the carrying values of
assets and liabilities and their taxation bases (as for the ones did not recognized as assets and liability and with taxation basis
recognized in line with tax regulations, different between tax base and its book value) at the tax rates applicable in the periods when
the Company recovers such assets or settles such liabilities.
(2) Deferred income tax assets are realized to the extent that it is probable to obtain such taxable income which is used to set off the
deductible temporary difference. As at the balance sheet date, if there is obvious evidence showing that it is probable to obtain
sufficient taxable income to set off the deductible temporary difference in future periods, deferred income tax assets not realized in
previous accounting periods shall be realized.
(3) The carrying value of deferred income tax assets shall be reviewed on the balance sheet date. If it is impossible to obtain
sufficient taxable income to set off the benefits of deferred income tax assets in future periods, the carrying value of deferred income
tax assets shall be reduced accordingly. If it is probable to obtain sufficient taxable income, the amount reduced shall be switched
back.
(4) The current income tax and deferred income tax shall be reckoned into current gains/losses as income tax expenses or incomes,
excluding the income tax arises from the following:
① Enterprise combination;
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
② Transactions or events recognized in owner’s equity directly
35. Lease
(1) Accounting for operating lease
Lease refers to a contract in which the lessor transfers the right-of-use assets to the lessee for consideration within a certain period of
time. On the commencement date of the contract, the company evaluates whether the contract is a lease or includes a lease. If one
party in the contract transfers the right to control the use of one or more identified assets within a certain period in exchange for
consideration, the contract is a lease or includes a lease. If the contract includes multiple separate leases at the same time, the
company will split the contract and conduct accounting treatment for each separate lease. If the contract includes both the leased and
non leased parts, the lessee and the lessor shall separate the leased and non leased parts.
(1) The company as lessee
For the general accounting treatment of the company as the lessee, see Note V 23 “right-to-use assets” and Note V 29 “lease
liabilities”.
For short-term leases with a lease term of no more than 12 months and low value asset leases with a lower value when a single asset
is new, the company chooses not to recognize the right-to-use assets and lease liabilities, and the relevant rental expenses are
included in the current profit and loss or the cost of relevant assets according to the straight-line method in each period of the lease
term.
If the lease changes and meets the following conditions at the same time, the company will treat the lease change as a separate lease
for Accounting: the lease change expands the lease scope by adding the right to use one or more leased assets; The increased
consideration is equivalent to the amount adjusted according to the conditions of the contract at the separate price for most of the
expansion of the lease scope. If the lease change is not accounted for as a separate lease, on the effective date of the lease change, the
company will reallocate the consideration of the contract after the change, redetermine the lease term, and remeasure the lease
liability according to the present value calculated in terms of the lease payment after the change and the revised discount rate.
(2) The company as lessor
On the lease commencement date, the company classifies leases that have substantially transferred almost all the risks and rewards
related to the ownership of the leased assets as financial leases, and all other leases are classified as operating leases.
1) Operating lease
During each period of the lease term, the company recognizes the lease receipts as rental income with the straight-line method. The
initial direct expenses incurred shall be capitalized, amortized on the same basis as the recognition of rental income, and included in
the current profit and loss by stages. The variable lease payments obtained by the company, which are related to operating leases but
not included in the lease receipts, will be booked into the current profits and losses at the time of occurrence.
2) Finance lease
On the beginning date of the lease term, the company recognizes the financial lease receipts in terms of the net amount of the lease
investment (the sum of the unsecured residual value and the present value of the lease receipts not received on the beginning date of
the lease term discounted according to the embedded interest rate of the lease), and terminates the recognition of financial lease
assets. During each period of the lease term, the company calculates and recognizes the interest income according to the embedded
interest rate of the lease. The amount of variable lease receipts obtained by the company that are not included in the measurement of
net lease investment shall be included in the current profit and loss at the time of occurrence.
(3) Sale leaseback
The company evaluates and determines whether the asset transfer in the sale leaseback transaction is a sale in accordance with the
accounting standards for Business Enterprises No. 14 - revenue.
1) The company as lessee
If the asset transfer in the sale leaseback transaction is a sale, the company measures the right-of-use assets formed by the sale
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
leaseback in terms of the part of the book value of the original assets related to the right of use obtained by the leaseback, and only
recognizes the relevant gains or losses on the rights transferred to the lessor.
If the asset transfer in the sale leaseback transaction is not a sale, the company will continue to recognize the transferred asset, and
meanwhile recognize a financial liability equal to the transfer income, and carry out accounting treatment for such financial liability
in accordance with the Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial
Instruments.
2) The company as lessor
If the asset transfer in the sale leaseback transaction is a sale, the company will conduct accounting treatment for asset purchase in
accordance with other applicable accounting standards for business enterprises, and perform accounting treatment for asset lease in
accordance with Accounting Standards for Business Enterprises No. 21 - Leasing.
If the asset transfer in the sale leaseback transaction does not belong to sales, the company will not recognize the transferred asset,
but recognizes a financial asset equal to the transfer income, and carries out accounting treatment for such financial asset in
accordance with the Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments.
(2) Accounting treatment for financing lease
Not applicable
36. Other major accounting policy and estimation
In the process of applying the Company's accounting policies, due to the inherent uncertainty of business activities, the Company
needs to judge, estimate and assume the book value of the report items which cannot be accurately measured. These judgments,
estimates and assumptions are made on the basis of the historical experience of the Company’s management and in consideration of
other relevant factors, which shall impact the reported amounts of income, expenses, assets and liabilities and the disclosure of
contingent liabilities on the balance sheet date. However, the actual results caused by the estimated uncertainties may differ from the
current estimates of the company’s management and consequently, the significant adjustments shall be made against the book value
of the involved assets or liabilities.
The Company regularly reviews the aforementioned judgments, estimates and assumptions on the basis of continuing operations. In
case changes in accounting estimates only affect the current period, the impact shall be recognized in the current period; In case
changes in accounting estimates not only affect the current period but also the future periods, the impacts shall be recognized in both
current and future periods.
On the balance sheet date, the important areas of the financial statements that the Company needs to judge, estimate and assume are
as follows:
(1) Provision for bad debts
The Company has used the expected credit loss model to assess the impairment of financial instruments, which requires significant
judgement and estimates, and must consider all reasonable and evidence-based information, including forward-looking information.
In making such judgments and estimates, the Company infers the expected changes in debtors’ credit risks based on historical
repayment data combined with economic policies, macroeconomic indicators, industry risks and other factors.
(2) inventory depreciation reserve
According to the inventory accounting policies, the Company measures the inventory at the lower between the cost and the net
realizable value. For inventory whose cost is higher than net realizable value and old and unsalable inventories, the Company
calculates and withdraws the inventory depreciation reserve. The inventory devalues to the net realizable value by evaluating the
inventory’s vendibility and net realizable value. To identify the inventory impairment, the management needs to obtain the
unambiguous evidences, and consider the purpose to hold the inventory, and judge and estimate the impacts of events after the
balance sheet date. The actual results and the differences between the previously estimated results shall affect the book value of
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
inventory and the provision or return of the inventory impairment during the period estimated to be changed.
(3) Preparation for the impairment of non-financial and non-current assets
The Company checks whether the non-current assets except for the financial assets may decrease in value at the balance sheet date.
For the intangible assets with indefinite service life, in addition to the annual impairment test, the impairment test is also needed
when there is a sign of impairment. For the other non-current assets except for the financial assets, the impairment test is needed
when it indicates that the book amounts may not be recoverable.
When the book value of the asset or group of assets exceeds its recoverable amount, i.e. the higher between the net amount by
subtracting the disposal costs from the fair value and the present value of expected future cash flows, it indicates the impairment.
As for the net amount by subtracting the disposal costs from the fair value, refer to the sales agreement price similar to the assets in
the fair trade or the observable market price, and subtract the incremental costs determination directly attributable to the disposal of
the asset.
When estimating the present value of the future cash flow, the Company needs to make significant judgments to the output, price,
and related operating expenses of the asset (or asset group) and the discount rate used for calculating the present value. When
estimating the recoverable amount, the Company shall adopt all the relevant information can be obtained, including the prediction
related to the output, price, and related operating expenses based on the reasonable and supportable assumptions.
The Company tests whether its business reputation decreases in value every year, which requires to estimating the present value of
the asset group allocated with goodwill or the future cash flow combined by the asset group. When estimating the present value of
the future cash flow, the Company needs to estimate the future cash flows generated by the asset group or the combination of asset
group, and select the proper discount rate to determine the present value of the future cash flows.
(4) Depreciation and amortization
The Company depreciates and amortizes the investment property, fixed assets and intangible assets according to the straight-line
method in the service life after considering the residual value. The Company regularly reviews the service life to determine the
depreciation and amortization expense amount to be reckoned in each reporting period. The service life is determined by the
Company based on the past experience of similar assets and the expected technological updating. If the previous estimates have
significant changes, the depreciation and amortization expense shall be adjusted in future periods.
(5) Fair value of financial instrument
Financial instruments that do not have active markets to provide quotes need to use valuation techniques to determine fair value.
Valuation techniques include the latest transaction information, discounted cash flow methods, and option pricing models. The
Company has established a set of work processes to ensure that qualified personnel are responsible for the calculation, verification
and review of fair value.The valuation model used by the Company uses the market information as much as possible and uses the
Company-specific information as little as possible.It should be noted that part of the information used in the valuation model requires
management’s estimation (such as discount rate, target exchange rate volatility, etc.).The Company regularly reviews the above
estimates and assumptions and makes adjustments if necessary.
(6) Income tax
In the Company’s normal business activities, there are some uncertainties in the final tax treatment and calculation of some
transactions. The tax authorities shall review and approve whether some items can be disbursed from the cost and expenses before
taxes. If the final affirmation of these tax matters differs from the initially estimated amount, the difference shall have an impact on
its current and deferred income taxes during the final recognition period.
55
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
37. Changes of important accounting policies and estimation
(1) Changes of important accounting policies
Applicable □Not applicable
Content and reasons for changes in accounting policies Approval process Note
On Nov. 30, 2021, the Ministry of Finance issued Interpretation No. 16 of the
Not applicable
Accounting Standards for Business Enterprises
On November 30, 2022, the Ministry of Finance issued Interpretation of Accounting Standards for Business Enterprises No. 16
(CK [2022] No.31, hereinafter referred to as “Interpretation No. 16”).
The deferred income tax related to assets and liabilities from individual transaction is inapplicable to the accounting treatment
exempted from initial recognition (effective from January 1, 2023)
According to the Interpretation No.16, an individual transaction other than an enterprise merger, not affecting accounting profits or
affecting the taxable income amount (or deductible loss) at the occurrence of transaction, with equivalent taxable temporary
difference and deductible temporary difference caused by initially recognized assets and liabilities (including a lease transaction in
which the lessee initially recognizes the lease liability on the commencement date of the lease term and includes into the use right
assets, as well as individual transactions recognized as estimated liabilities and included into relevant asset costs due to the
presence of disposal obligations for fixed assets) is inapplicable to the provisions of exempting deferred income tax liabilities and
deferred income tax assets from initial recognition, and the enterprise shall respectively recognize the corresponding deferred
income tax liabilities and deferred income tax assets in accordance with the Accounting Standards for Business Enterprises No. 18
- Income Tax at the occurrence of the transaction.
For individual transactions that occurred between the beginning of the earliest period for which the provision is first applied and
the date of implementation of the provision to which the provision applies, as well as the lease liabilities and use right assets
recognized as a result of the individual transactions to which the provision applies at the beginning of the earliest period for which
the provision is presented in the financial statements, and the recognized estimated liabilities related to the disposal obligation and
corresponding assets, where there is a taxable temporary difference or a deductible temporary difference, the enterprise shall make
adjustments in accordance with this provision. The implementation of this provision has not had a material impact on the financial
position and operating results of the Company.
(2) Changes of important accounting estimations
□Applicable Not applicable
(3) Related items of financial statements at the beginning of the first year to implement the new
accounting standards adjustment for the first time starting from 2023
□Applicable Not applicable
38. Others
Nil
VI. Taxation
1. Major taxes and tax rates
56
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Tax Basis Tax rate
The output tax is calculated based on the taxable income, and 25%(IRD,Denmark), 22%(VHIO，
VAT VAT is calculated based on the difference after deducting the Italy),21%(Borit,Belgium), 13%, 9%,
input tax available for deduction for the current period 6%, Collection rate 5%
City maintaining &
Turnover tax payable 7%,5%
construction tax
15%, 20%,21% (IRD America, Borit
America), 22% (IRD,Denmark),
Corporation income tax Taxable income
24%(VHIO，Italy),
25%(Borit,Belgium)
Educational surtax Turnover tax payable 5%
Disclose reasons for different taxpaying body
Taxpaying body Income tax rate
WFCA, WFTR, WFAS, WFDT, Borit, VHWX 25%
The Company, WFJN, WFLD, WFTT, WFLD(Chongqing), WFAM,WFMA,WFSC 15%
WFLD(Wuhan), WFLD(Nanchang) 20%
IRD America, Borit America 21%
SPV, IRD 22%
VHIO 24%
2. Tax incentives
The Company, WFJN, WFLD, WFTT and WFMA were accredited as high-tech enterprises in 2020, and enjoy a preferential income
tax rate of 15% in the period from January 1, 2020 to December 31, 2022. WFAM was accredited as high-tech enterprise in 2021,
and enjoy a preferential income tax rate of 15% in the period from January 1, 2021 to December 31, 2023. WFSC was accredited as
high-tech enterprise in 2022, and enjoy a preferential income tax rate of 15% in the period from January 1, 2022 to December 31,
2024.
According to the “Continuation of the Enterprise Income Tax Policies for Western Development” No.23 (Year of 2020) issued
together by Ministry of Finance, SAT and NDRC, from January 1, 2011 to December 31, 2030, the enterprises located in the west
region and mainly engaged in the industrial projects stipulated in the Catalogue of Encouragement Industries in Western China, and
whose main business income accounting for more than 60% of the total income of the enterprise in the current year can pay the
corporate income tax at the tax rate of 15%. In the first half year of 2023, WFLD (Chongqing) paid its corporate income tax at the tax
rate of 15%.
In the first half year of 2023, WFLD (Wuhan) and WFLD(Nanchang) were qualified small and low-profit enterprises, and the part of
taxable income that did not exceed 3 million yuan was included in the taxable income at a reduced rate of 25%, and the corporate
income tax was paid at the tax rate of 20%.
3. Other
Nil
VII. Notes to major items in consolidated financial statements
1. Monetary funds
In RMB
57
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Item Ending balance Opening balance
Cash on hand 76,329.51 51,818.51
Cash in bank 2,447,388,349.63 2,304,848,889.90
Other monetary funds 40,321,462.90 84,651,222.35
Total 2,487,786,142.04 2,389,551,930.76
Including: total amount of funds deposited overseas 228,685,960.81 324,409,336.06
The total amount of funds restricted on use due to mortgage, pledge, or freezing 39,059,182.90 51,080,295.65
Other explanation
The ending balance of other monetary funds includes bank acceptance bill deposit 12,066,812.90 yuan, cash deposit for Mastercard
211,620.00 yuan, in-transit dividends 1,262,280.00, IRD performance bond 7,935,750.00 yuan, the foreign exchange contract margin
188,400,000.00 yuan, and ETC freezing 5,000.00 yuan. The in-transit dividends 1,262,280.00 yuan was a portion of the dividend
distributed by Miracle Automation (002009), a trading financial asset held by the company, from 2017 to 2022, which was not
transferred to the company’s current account due to account issues.
2. Trading financial asset
In RMB
Item Ending balance Opening balance
Financial assets measured at fair value and whose changes are
2,250,198,464.28 2,718,820,654.87
included in current profit or loss
Including:
SNAT 79,224,360.00 78,834,732.00
Miracle Automation 71,026,800.00 66,693,600.00
Lifan Technology 44,871.33 48,516.34
Toyze Auto 267,028.08 462,414.48
Other debt and equity instrument investments 2,099,635,404.87 2,572,781,392.05
Including：
Total 2,250,198,464.28 2,718,820,654.87
3. Note receivable
(1) Classification of notes receivable
In RMB
Item Ending balance Opening balance
Trade acceptance bill 104,980,712.30 135,559,024.27
Total 104,980,712.30 135,559,024.27
In RMB
Ending balance Opening balance
Provision for bad Provision for bad
Book balance Book value
Category debts debts
Book value Book value
Amou Accru Amou Accru
Amount Ratio Amount Ratio
nt al ratio nt al ratio
Including:
58
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Note
receivable
with
provision 104,980, 104,980,712. 135,559,02 135,559,024.
100.00% 100.00%
for bad 712.30 30 4.27 27
debts
accrual on
portfolio
Including:
Portfolio 1:
bank
acceptance
bill
Portfolio 2:
trade 104,980, 104,980,712. 135,559,02 135,559,024.
100.00% 100.00%
acceptance 712.30 30 4.27 27
bill
104,980, 104,980,712. 135,559,02 135,559,024.
Total 100.00% 100.00%
712.30 30 4.27 27
If the provision for bad debts of note receivable is made in accordance with the general model of expected credit losses, please
refer to the disclosure of other receivables to disclose related information about bad-debt provisions:
□Applicable Not applicable
(2) Provision for bad debts accrual, collected or reversal
Provision for bad debts in the current period:
□ Applicable Not applicable
(3) Notes receivable already pledged by the Company at the end of the period
In RMB
Item Amount pledge at period-end
Trade acceptance bill 37,607,161.90
Total 37,607,161.90
(4) Notes endorsement or discount and undue on balance sheet date
Nil
(5) Notes transfer to account receivable due for failure implementation by drawer at period-end
In RMB
Item Amount transfer to account receivable at period-end
Trade acceptance bill 7,006,453.02
Total 7,006,453.02
Other explanation
The trade acceptance bill that the company transferred to the accounts receivable due to in 2018 the failure of the drawer to perform
the agreement at the end of the period were the bills of the subsidiaries controlled by Baota Petrochemical Group Co., Ltd. and the
bills accepted by Baota Petrochemical Group Finance Co., Ltd. (hereinafter referred to as “BD bills”); In 2018, the amount
transferred to account receivable was 7 million yuan, and 1.7 million yuan was recovered in 2019, the amount transferred to account
59
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
receivable rose by 2.00 million yuan in 2022, and enforced money 98,309 yuan and 195,237.98 yuan were received respectively in
the year of 2022 and 2023.
(6) Note receivable actually written-off in the period
Nil
4. Account receivable
(1) Classification of account receivable
In RMB
Ending balance Opening balance
Provision for bad Provision for bad
Category Book balance Book balance
debts Book debts Book
Accrual value Accrual value
Amount Ratio Amount Amount Ratio Amount
ratio ratio
Account
receivable with
provision for 54,533,8 54,533,8 57,806,7 57,806,7
1.61% 100.00% 1.80% 100.00%
bad debts 29.30 29.30 05.14 05.14
accrual on a
single basis
Including:
Account
receivable with
provision for 3,342,27 98.39 24,891,3 3,317,38 3,149,15 98.20 21,667,5 3,127,490
0.74% 0.69%
bad debts 8,424.11 % 46.55 7,077.56 7,700.73 % 23.48 ,177.25
accrual on
portfolio
Including:
3,396,81 100.00 79,425,1 3,317,38 3,206,96 100.00 79,474,2 3,127,490
Total 2.34% 2.48%
2,253.41 % 75.85 7,077.56 4,405.87 % 28.62 ,177.25
Provision for bad debts accrual on single basis: 54,533,829.30 yuan
In RMB
Ending balance
Name Provisions for Accrual
Book balance Accrual causes
bad debts ratio
Have difficulty in
Hubei Meiyang Auto Industry Co., Ltd. 17,610,371.91 17,610,371.91 100.00%
collection
Have difficulty in
Hunan Leopaard Auto Co., Ltd. 8,077,361.13 8,077,361.13 100.00%
collection
Have difficulty in
BD bills 7,006,453.02 7,006,453.02 100.00%
collection
Linyi Zotye Automobile Components Have difficulty in
6,193,466.77 6,193,466.77 100.00%
Manufacturing Co., Ltd. collection
Have difficulty in
Tongling Ruineng Purchasing Co., Ltd. 4,320,454.34 4,320,454.34 100.00%
collection
Have difficulty in
Brilliance Automotive Group Holdings Co., Ltd. 3,469,091.33 3,469,091.33 100.00%
collection
Have difficulty in
Jiangsu Kawei Auto Industrial Group Co., Ltd. 1,932,476.26 1,932,476.26 100.00%
collection
60
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Have difficulty in
Dongfeng Chaoyang Diesel Co., Ltd. 1,823,262.64 1,823,262.64 100.00%
collection
Have difficulty in
Jiangsu Jintan Automobile Industry Co., Ltd. 1,059,798.43 1,059,798.43 100.00%
collection
Have difficulty in
Tianjin Levol Engine Co., Ltd. 1,018,054.89 1,018,054.89 100.00%
collection
Have difficulty in
Other clients 2,023,038.58 2,023,038.58 100.00%
collection
Total 54,533,829.30 54,533,829.30
Provisions for bad debts accrual on portfolio: 24,891,346.55 yuan
In RMB
Ending balance
Name
Book balance Provision for bad debts Accrual ratio
Within 6 months 3,206,178,893.81
6 months to 1 year 97,331,858.14 9,733,185.83 10.00%
1-2 years 21,212,969.31 4,242,593.82 20.00%
2-3 years 11,065,226.59 4,426,090.64 40.00%
Over 3 years 6,489,476.26 6,489,476.26 100.00%
Total 3,342,278,424.11 24,891,346.55
Explanation on determining the basis for this combination:
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses, please
refer to the disclosure of other receivables to disclose related information about bad-debt provisions:
□ Applicable Not applicable
By account age
In RMB
Account age Book balance
Within 1 year (1 year included) 3,304,455,538.89
Including: within 6 months 3,206,178,894.62
6 months to 1 year 98,276,644.27
1-2 years 21,457,907.25
2-3 years 14,031,287.79
Over 3 years 56,867,519.48
3-4 years 56,867,519.48
Total 3,396,812,253.41
(2) Provisions for bad debts accrual, collected or reversal
Provisions for bad debts accrual in the period:
In RMB
Amount changed in the period
Opening
Category Collected or Ending balance
balance Accrual Charged off Other
reversal
61
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Provision for
79,474,228.62 5,996,407.94 6,142,952.15 20,150.61 117,642.05 79,425,175.85
bad debts
Total 79,474,228.62 5,996,407.94 6,142,952.15 20,150.61 117,642.05 79,425,175.85
Important provision for bad debts collected or reversal: Nil
(3) Account receivable actually charged off in the Period
In RMB
Item Amount charged off
Jiangdong Zhizao Technology Co., Ltd 20,150.61
Total 20,150.61
Important accounts receivable charged off: Nil
Explanation of accounts receivable charged off: Nil
(4) Top 5 receivables at ending balance by arrears party
In RMB
Ending balance of account Ratio in total ending balance of Ending balance of
Name
receivable accounts receivable provision for bad debts
RBCD 511,897,553.12 15.07% 619,942.02
Robert Bosch Company 423,176,007.79 12.46% 754,342.26
Client 1 176,089,133.91 5.18% 189,464.96
Client 2 167,531,932.86 4.93% 1,488,908.66
Client 3 143,584,376.04 4.23%
Total 1,422,279,003.72 41.87% 3,052,657.90
(5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Nil
5. Receivable financing
In RMB
Item Ending balance Opening balance
Bill receivable- bank acceptance bill 1,920,348,206.04 1,918,368,845.21
Total 1,920,348,206.04 1,918,368,845.21
Increase and decrease in current period and changes in fair value of receivables financing
□ Applicable Not applicable
If the provision for bad debts of account receivable is calculated and withdrawn according to the general model of expected credit
loss, please refer to the disclosure method of other accounts receivable in aspect of impairment provision:
62
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
□ Applicable Not applicable
Other explanation:
During the management of liquidity, the company will discount some bills or endorse some bills for transference before the maturity
of such bills, the business model for managing bills receivable is to collect contractual cash flows and sell the financial asset, so it is
classified as financial assets measured at fair value and whose changes are included in other comprehensive income, which is listed
in receivables financing.
At the end of the period, the company has pledged notes receivable of 825,831,044.39 yuan, and notes receivable that have been
endorsed or discounted and have not yet matured on the balance sheet date are 178,018,855.56 yuan.
6. Prepayments
(1) Account age of Prepayments
In RMB
Ending balance Opening balance
Account age
Amount Ratio Amount Ratio
Within 1 year 59,364,895.05 87.67% 88,207,782.70 93.51%
1-2 years 6,674,170.61 9.86% 5,066,837.28 5.37%
2-3 years 1,489,110.74 2.20% 778,819.68 0.83%
Over 3 years 182,487.83 0.27% 270,414.21 0.29%
Total 67,710,664.23 94,323,853.87
Explanation of the reasons why prepayments with an aging of over 1 year and significant amounts were not settled in a timely
manner: Nil
(2) Top 5 prepayments at ending balance by prepayment object
Total ending balance of top 5 prepayments by prepayment object amounted to 23,271,002.96 yuan, 34.37% of the total prepayments
at the period-end.
Other explanation: Nil
7. Other accounts receivable
In RMB
Item Ending balance Opening balance
Dividend receivable 1,955,605,474.71 147,000,000.00
Other accounts receivable 918,941,597.26 1,117,507,456.47
Total 2,874,547,071.97 1,264,507,456.47
(1) Interest receivable
1) Category of interest receivable
Nil
63
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2) Significant overdue interest
Nil
3) Accrual of provision for bad debts
□ Applicable Not applicable
(2) Dividend receivable
1) Category of dividend receivable
In RMB
Item (or invested enterprise) Ending balance Opening balance
Wuxi WFEC Catalyst Co., Ltd. 147,000,000.00
RBCD 1,673,605,474.71
Zhonglian Automobile Electronics Co., Ltd. 282,000,000.00
Total 1,955,605,474.71 147,000,000.00
2) Important dividend receivable with account age over one year
Nil
3) Accrual of provision for bad debts
□Applicable Not applicable
(3) Other accounts receivable
1) By nature
In RMB
Nature Ending book balance Opening book balance
Intercourse funds from units 1,407,955.77 1,894,818.08
Cash deposit 8,978,638.40 9,087,881.41
Staff loans and petty cash 2,020,922.82 1,823,842.27
Social security and provident fund paid 10,521,493.38 11,341,820.83
WFTR “platform trade” business
2,542,263,370.70 2,741,499,131.95
portfolio
Other 3,031,937.89 66,663.56
Total 2,568,224,318.96 2,765,714,158.10
2) Accrual of provision for bad debts
In RMB
64
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Phase I Phase II Phase III
Expected credit losses
Provision of bad debts Expected credit losses for
Expected credit losses for the entire duration Total
the entire duration (without
over next 12 months (with credit
credit impairment occurred)
impairment occurred)
Balance on Jan. 1, 2023 4,106,646.90 1,644,100,054.73 1,648,206,701.63
Balance of Jan. 1, 2023 in
the period
Current accrual 1,175,781.30 1,175,781.30
Current reversal 182,511.33 182,511.33
Other changes 82,750.10 82,750.10
Balance on June 30, 2023 5,182,666.97 1,644,100,054.73 1,649,282,721.70
Change of book balance of loss provision with amount has major changes in the period
□ Applicable Not applicable
By account age
In RMB
Account age Book balance
Within 1 year (1 year included) 2,560,675,182.39
Including: within 6 months 1,919,640,482.87
6 months to 1 year 641,034,699.52
1-2 years 1,010,751.05
2-3 years 2,804,594.75
Over 3 years 3,733,790.77
3-4 years 3,733,790.77
Total 2,568,224,318.96
3) Provision for bad debts accrual, collected or reversal
Provision for bad debts accrual in the period:
In RMB
Change in current period
Category Opening balance Ending balance
Accrual Collected or reversal Charge off Other
Provision for
1,648,206,701.63 1,175,781.30 182,511.33 82,750.10 1,649,282,721.70
bad debts
Total 1,648,206,701.63 1,175,781.30 182,511.33 82,750.10 1,649,282,721.70
Including the important provision for bad debts reversal or collected in the period: Nil
4) Other accounts actually charged off during the reporting period
Nil
5) Top 5 other accounts receivable at ending balance by arrears party
In RMB
65
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Ratio in total ending Ending balance of
Account
Enterprise Nature Ending balance balance of other provision for bad
age
accounts receivables debts
WFTR “platform trade” business Refer to Within 1
2,542,263,370.70 98.99% 1,644,068,327.93
portfolio other notes year
Wuxi China Resources Gas Co., Deposit Within 3
1,364,750.00 0.05% 749,150.00
Ltd. margin years
Zhenkunxing Industrial Deposit 2-3
1,000,000.00 0.04% 400,000.00
Supermarket (Shanghai) Co., Ltd. margin years
Wuxi Xingzhou Energy Deposit Within 2
882,319.65 0.03% 89,031.78
Development Co., Ltd margin years
Wuxi Youlian Thermal Power Co., Deposit Over 3
750,000.00 0.03% 750,000.00
Ltd margin years
Total 2,546,260,440.35 99.14% 1,646,056,509.71
Other explanations: For details on the “platform trade” business portfolio of WFTR, please refer to the descriptions in Note XVI. 7.
“Major transaction and events influencing investor’s decision”.
6) Other accounts receivable related to government grants
Nil
7) Other accounts receivable derecognized due to the transfer of financial assets
Nil
8) The amount of assets and liabilities formed by transferring other receivables and continuing to be
involved
Nil
8. Inventory
Whether the Company need to comply with disclosure requirements in the real estate industry or not
Nil
(1) Category of inventory
In RMB
Ending balance Opening balance
Inventory Inventory
depreciation depreciation
Item reserve or reserve or
Book balance provision for Book value Book balance provision for Book value
impairment of impairment of
contract contract
performance costs performance costs
Stock
674,113,552.27 169,224,572.51 504,888,979.76 796,941,337.63 160,326,360.21 636,614,977.42
materials
Goods in
421,261,059.47 34,297,563.35 386,963,496.12 437,653,321.23 31,641,606.69 406,011,714.54
process
Finished
1,149,136,067.70 119,904,477.76 1,029,231,589.94 1,382,835,104.89 142,342,140.58 1,240,492,964.31
goods
Total 2,244,510,679.44 323,426,613.62 1,921,084,065.82 2,617,429,763.75 334,310,107.48 2,283,119,656.27
66
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Inventory depreciation reserve or provision for impairment of contract performance costs
In RMB
Current increased Current decreased
Item Opening balance Reversal or Ending balance
Accrual Other Other
write-off
Stock materials 160,326,360.21 43,364,778.05 846,631.35 35,313,197.10 169,224,572.51
Goods in process 31,641,606.69 9,893,111.73 626,433.36 7,863,588.43 34,297,563.35
Finished goods 142,342,140.58 36,730,651.32 280,633.75 59,448,947.89 119,904,477.76
Total 334,310,107.48 89,988,541.10 1,753,698.46 102,625,733.42 323,426,613.62
① Net realizable value of inventory is equal to, during the day-to-day activities, the estimated sale price of inventory minus
estimated cost to be incurred till works completed, estimated sales expense and relevant taxes.
② Accrual basis for inventory depreciation reserve:
Item Accrual basis for inventory impairment provision Specific basis for recognition
The materials sold to manufacture finished The estimated sale price of finished products minus
Materials in stock goods, its net realizable value is lower than its estimated cost to be incurred till works completed,
book value estimated sales expense and relevant taxes
The goods in process sold to manufacture The estimated sale price of finished products minus
Goods in process finished goods, its net realizable value is lower estimated cost to be incurred till works completed,
than the book value estimated sales expense and relevant taxes
Its net realizable value is lower than the book The estimated sale price minus relevant taxes and
Finished goods
value expenses
③ Reasons of inventory depreciation reserve written off in current period:
Item Reasons of written off
Materials in stock Used for production in reporting period and the finished goods have been sold
Goods in process completed in the reporting period and corresponding finished goods have been sold in the
Goods in process
reporting period
Finished goods Have been sold in current period
(3) Explanation on capitalization of borrowing costs at ending balance of inventory
Nil
(4) Explanation on the current amortization amount of contract performance cost
Nil
9. Other current assets
In RMB
Item Ending balance Opening balance
Export tax rebates receivable 7,479,670.43 14,325,020.52
VAT refund receivable 55,946,713.17 25,444,657.63
Prepaid taxes and VAT retained 165,724,432.78 364,556,192.43
Input tax to be deducted and certification 11,806.79 1,192,752.68
Other 11,799,744.63 25,028,577.98
Total 240,962,367.80 430,547,201.24
Other explanation:
67
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
10. Long-term equity investment
In RMB
Current changes (+/ -)
Ending
Opening Other Cash Ending balance
The Investmen
balance Additi Capi compreh Other dividend balance of
invested t gain/loss Impairm
(book onal tal ensive equity or profit (book depreci
entity recognize ent Other
value) invest redu income chang announc value) ation
d under accrual
ment ction adjustm e ed to reserves
equity
ent issued
I. Joint venture
II. Associated enterprise
824,528,80 82,219,484 906,748,
WFEC
9.89 .77 294.66
3,659,761,3 487,327,96 1,673,60 2,473,48
RBCD
10.97 2.11 5,474.71 3,798.37
Zhonglian 1,559,413,3 179,345,68 282,000, 1,456,75
Electronic 14.05 8.18 000.00 9,002.23
54,829,812. 2,157,950. 56,987,7
WFPM
51 41 62.92
Changchu 9,621,734.8 - 9,319,49
n Xuyang 3 302,244.09 0.74
Precors 5,517,924.5 2,791,7 - 491,31 8,600,85
GmbH 6 25.00 200,110.59 2.08 1.05
Chelian 169,145,20 169,575,
430,317.51
Tianxia 2.15 519.66
110,00 -
Lezhuo 106,520,
0,000.0 3,479,485.
Bowei 514.80
0 20
112,79
6,282,818,1 747,499,56 1,955,60 491,31 5,187,99
Subtotal 1,725.0
08.96 3.10 5,474.71 2.08 5,234.43
0
112,79
6,282,818,1 747,499,56 1,955,60 491,31 5,187,99
Total 1,725.0
08.96 3.10 5,474.71 2.08 5,234.43
0
Other explanation
Explanation on those holding less than 20% of the voting rights but with significant influence:
The Company holds 9.6372% equity of Chelian Tianxia, and appointed a director to Chelian Tianxia. Though such representative,
the Company can participate in the operation policies formulation of Chelian Tianxi, and thus exercise a significant influence over
Chelian Tianxi.
11. Other equity instrument investment
In RMB
Item Ending balance Opening balance
Wuxi Xidong Science & Technology Industrial Park 5,000,000.00 5,000,000.00
Beijing Zhike Industry Investment Holding Group Co., Ltd. 75,940,000.00 75,940,000.00
Rare earth Catalysis Innovation Research Institute
4,108,000.00 4,108,000.00
(Dongying) Co., Ltd.
Wuxi Xichan Microchip Semi-Conductor 592,742,690.00 592,742,690.00
Total 677,790,690.00 677,790,690.00
68
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
12. Other non-current financial assets
In RMB
Item Ending balance Opening balance
Guolian Securities 161,342,387.00 186,608,914.00
Investments in other debt instruments and equity
1,005,000,000.00 1,140,000,000.00
instruments held for more than one year
Total 1,166,342,387.00 1,326,608,914.00
13. Investment real estate
(1) Investment real estate measured by cost
Applicable □ Not applicable
In RMB
House and Construction
Item Land use right Total
Building in progress
I. Original book value
1.Opening balance 97,691,776.27 97,691,776.27
2.Current increased 15,143,746.66 15,143,746.66
(1) Outsourcing
(2) Inventory\fixed assets\construction in process
15,143,746.66 15,143,746.66
transfer-in
(3) Increased by combination
3.Current decreased 2,364,090.24 2,364,090.24
(1) Disposal 2,364,090.24 2,364,090.24
(2) Other transfer-out
4.Ending balance 110,471,432.69 110,471,432.69
II. Accumulated depreciation and accumulated
amortization
1.Opening balance 48,394,906.54 48,394,906.54
2.Current increased 8,184,558.32 8,184,558.32
(1) Accrual or amortization 1,578,413.90 1,578,413.90
(2)Transferred from inventory, fixed assets, and
6,606,144.42 6,606,144.42
construction in progress
3.Current decreased 2,293,167.53 2,293,167.53
(1) Disposal 2,293,167.53 2,293,167.53
(2) Other transfer-out
4.Ending balance 54,286,297.33 54,286,297.33
III. Depreciation reserves
1.Opening balance
2.Current increased
(1) Accrual
3. Current decreased
(1) Disposal
(2) Other transfer-out
4.Ending balance
IV. Book value
1.Ending Book value 56,185,135.36 56,185,135.36
2.Opening Book value 49,296,869.73 49,296,869.73
69
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Investment real estate measured at fair value
□ Applicable Not applicable
(3) Investment real estate without property certification held
Nil
14. Fixed assets
In RMB
Item Ending balance Opening balance
Fixed assets 3,745,590,665.96 3,769,984,185.94
Total 3,745,590,665.96 3,769,984,185.94
(1) Fixed assets
In RMB
House and Machinery Transportation Electronic and other
Item Land Total
Building equipment equipment equipment
I. Original book
value:
1.Opening balance 1,934,526,060.96 4,613,504,836.29 38,612,263.18 1,046,301,287.16 30,483,292.05 7,663,427,739.64
2.Current increased 6,008,444.26 113,360,889.00 16,401,981.30 106,730,315.10 242,501,629.66
(1) Purchase 92,603.75 4,642,398.44 5,122,002.64 1,476,883.90 11,333,888.73
(2) Construction in
progress transfer-in 5,915,840.51 108,718,490.56 11,279,978.66 105,253,431.20 231,167,740.93
(3)Investment real
estate transfer-in
3.Current decreased 20,711,919.83 25,929,597.53 1,726,864.06 18,507,266.49 66,875,647.91
(1) Disposal or
scrapping 20,711,919.83 25,929,597.53 1,726,864.06 18,507,266.49 66,875,647.91
4.Conversion of
foreign currency 7,786,172.25 26,874,425.09 726,445.15 18,660,373.17 1,865,547.08 55,912,962.74
financial statement
5.Ending balance 1,927,608,757.64 4,727,810,552.85 54,013,825.57 1,153,184,708.94 32,348,839.13 7,894,966,684.13
II. Accumulated
depreciation
1.Opening balance 536,810,138.49 2,470,972,225.66 21,621,368.25 664,099,659.92 3,693,503,392.32
2.Current increased 32,496,132.87 113,728,096.55 1,235,792.50 110,584,663.57 258,044,685.49
(1) Accrual 32,496,132.87 113,728,096.55 1,235,792.50 110,584,663.57 258,044,685.49
3.Current decreased 7,633,458.71 22,066,910.45 1,194,186.78 14,707,800.49 45,602,356.43
(1) Disposal or
scrapping 7,633,458.71 22,066,910.45 1,194,186.78 14,707,800.49 45,602,356.43
4.Conversion of
foreign currency 3,458,756.64 18,928,181.63 661.56 14,682,619.54 37,070,219.37
financial statement
5.Ending balance 565,131,569.29 2,581,561,593.39 21,663,635.53 774,659,142.54 3,943,015,940.75
III. Depreciation
reserves
1.Opening balance 14,097,320.49 148,903,639.01 73,319.90 21,710,795.11 15,155,086.87 199,940,161.38
2.Current increased 274,995.90 274,995.90
(1) Accrual 274,995.90 274,995.90
3.Current decreased 124,646.67 98,219.18 222,865.85
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(1) Disposal or
scrapping 124,646.67 98,219.18 222,865.85
4.Conversion of
foreign currency 862,515.42 3,805,736.91 772,057.45 927,476.21 6,367,785.99
financial statement
5.Ending balance 14,959,835.91 152,859,725.15 73,319.90 22,384,633.38 16,082,563.08 206,360,077.42
IV. Book value
1.Ending book value 1,347,517,352.44 1,993,389,234.31 32,276,870.14 356,140,933.02 16,266,276.05 3,745,590,665.96
2.Opening book
value 1,383,618,601.98 1,993,628,971.62 16,917,575.03 360,490,832.13 15,328,205.18 3,769,984,185.94
(2) Temporarily idle fixed assets
Nil
(3) Fixed assets acquired by operating lease
Nil
(4) Fixed assets without property certification held
Nil
In RMB
Item Book value Reasons for without the property certification
Plant and office building of WFCA 31,301,783.70 The relevant property rights procedures are still being processed
(5) Disposal of fixed assets
Nil
15. Construction in progress
In RMB
Item Ending balance Opening balance
Construction in progress 639,963,756.99 509,105,587.49
Total 639,963,756.99 509,105,587.49
(1) Construction in progress
In RMB
Ending balance Opening balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserves reserves
Technical transformation of parent
company 111,929,396.69 111,929,396.69 132,814,463.95 132,814,463.95
WFMS rebuilding of the parent
company 23,300,153.61 23,300,153.61 20,562,758.75 20,562,758.75
Renovation of Xinan Branch, No. 6
Huashan Road of Parent Company 62,697,798.04 62,697,798.04 41,493,029.41 41,493,029.41
Technical transformation of WFAM 89,518,742.76 89,518,742.76 69,450,019.06 69,450,019.06
Technical transformation of WFLD 11,955,259.21 11,955,259.21 16,739,199.84 16,739,199.84
Technical transformation of
Denmark RID 130,799,625.17 130,799,625.17 82,081,060.63 82,081,060.63
Technical transformation of Italy
VHIO 41,376,242.80 41,376,242.80 47,822,275.01 47,822,275.01
Other projects 168,386,538.71 168,386,538.71 98,142,780.84 98,142,780.84
Total 639,963,756.99 639,963,756.99 509,105,587.49 509,105,587.49
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Changes of major construction in progress
In RMB
Includi
Accum
Fixed Proporti ng:
Other ulated Interest
assets on of interest
Openin Current decreas amount capitali
Bud transfer Ending project Progres capitali Source of
Item g increase ed in of zation
get -in in balance investm s zed funds
balance d the interest rate of
the ent in amount
Period capitali the year
Period budget of the
zation
year
Technical Accumulate
transformat
132,814 90,155, 109,634 1,406,5 111,929 d funds by
ion of
parent ,463.95 496.59 ,054.55 09.30 ,396.69 the
company Company
WFMS
Accumulate
rebuilding
20,562, 2,737,3 23,300, d funds by
of the
758.75 94.86 153.61 the
parent
Company
company
Renovation
of Xinan
Branch, Accumulate
No. 6 41,493, 21,204, 62,697, d funds by
Huashan 029.41 768.63 798.04 the
Road of Company
Parent
Company
Technical Accumulate
transformat 69,450, 30,011, 9,943,1 89,518, d funds by
ion of 019.06 849.10 25.40 742.76 the
WFAM
Company
Technical Accumulate
transformat 16,739, 33,141, 37,925, 11,955, d funds by
ion of 199.84 808.42 749.05 259.21 the
WFLD
Company
Technical Accumulate
transformat
82,081, 48,718, 130,799 d funds by
ion of
Denmark 060.63 564.54 ,625.17 the
IRD Company
Technical Accumulate
transformat 47,822, 2,541,3 8,987,4 41,376, d funds by
ion of Italy 275.01 89.03 21.24 242.80 the
VHIO Company
410,962 228,511 166,490 1,406,5 471,577
Total
,806.65 ,271.17 ,350.24 09.30 ,218.28
(3) The provision for impairment of construction in progress
Nil
(4) Engineering materials
Nil
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
16. Right-of-use assets
In RMB
Item Building Mechanical equipment Total
I. Original book value:
1.Opening balance 34,416,049.86 25,021,445.63 59,437,495.49
2.Current increased 2,362,331.76 2,362,331.76
(1)Increased lease 2,362,331.76 2,362,331.76
3.Current decreased
4. Conversion of foreign currency financial statement 1,315,146.09 884,504.09 2,199,650.18
5.Ending balance 38,093,527.71 25,905,949.72 63,999,477.43
II. Accumulated depreciation
1.Opening balance 11,035,938.99 6,536,456.12 17,572,395.11
2.Current increased 3,113,424.70 3,267,093.16 6,380,517.86
(1) Accrual 3,113,424.70 3,267,093.16 6,380,517.86
3.Current decreased
(1) Disposal
4. Conversion of foreign currency financial statement 427,621.05 254,102.61 681,723.66
5.Ending balance 14,576,984.74 10,057,651.89 24,634,636.63
III. Depreciation reserves
1.Opening balance
2.Current increased
(1) Accrual
3.Current decreased
(1) Disposal
4.Ending balance
IV. Book value
1.Ending book value 23,516,542.97 15,848,297.83 39,364,840.80
2.Opening book value 23,380,110.87 18,484,989.51 41,865,100.38
17. Intangible assets
(1) Intangible assets
In RMB
Non-patent Computer Trademark and
Item Land use right Patent Total
technology software trademark license
I. Original book value
1. Opening balance 381,867,130.62 247,735,742.07 156,331,661.37 41,597,126.47 827,531,660.53
2. Current increased 5,000,000.00 22,416,196.26 27,416,196.26
(1) Purchase 3,801,880.28 3,801,880.28
(2) Internal R&D
(3) Increased by combination
(4) Transfer from construction in
5,000,000.00 18,614,315.98 23,614,315.98
progress
3. Current decreased 8,922,112.00 8,922,112.00
(1) Disposal 8,922,112.00 8,922,112.00
4. Conversion of foreign currency
financial statement 13,186,892.90 1,064,798.27 14,251,691.17
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
5. Ending balance 372,945,018.62 265,922,634.97 179,812,655.90 41,597,126.47 860,277,435.96
II. Accumulated amortization
1. Opening balance 112,319,506.81 82,143,152.44 118,642,946.06 9,709,000.00 322,814,605.31
2. Current increased 1,798,082.72 12,400,528.93 4,075,392.72 14,152,357.93 32,426,362.30
(1) Amortization 1,798,082.72 12,400,528.93 4,075,392.72 14,152,357.93 32,426,362.30
3. Current decreased 7,410,097.90 7,410,097.90
(1) Disposal 7,410,097.90 7,410,097.90
4. Conversion of foreign currency
financial statement 5,068,852.73 503,275.39 5,572,128.12
5. Ending balance 106,707,491.63 99,612,534.10 123,221,614.17 23,861,357.93 353,402,997.83
III. Depreciation reserves
1. Opening balance 442,167.30 16,646,900.00 17,089,067.30
2. Current increased
(1) Accrual
3. Current decreased
(1) Disposal
4. Conversion of foreign currency
27,060.18 27,060.18
financial statement
5. Ending balance 469,227.48 16,646,900.00 17,116,127.48
IV. Book value
1. Ending book value 266,237,526.99 166,310,100.87 56,121,814.25 1,088,868.54 489,758,310.65
2. Opening book value 269,547,623.81 165,592,589.63 37,246,548.01 15,241,226.47 487,627,987.92
(2) Land use right without property certification held
Nil
18. Goodwill
(1) Original book value of goodwill
In RMB
Current increased Current decreased
The invested entity
Opening Formed by Translation of
or matters forming Ending balance
balance business foreign currency Disposal
goodwill
combination statements
Merged with WFTT 1,784,086.79 1,784,086.79
Merged with Borit 235,898,288.93 14,130,739.94 250,029,028.87
Total 237,682,375.72 14,130,739.94 251,813,115.66
(2) Goodwill depreciation reserves
Other explanation:
1) Goodwill formed by the merger of WFTT:
In 2010, the Company merged WFTT and became its controlling shareholders by increasing cash capital, and goodwill was the part
of merge cost greater than the fair value of identifiable net assets of WFTT.
2) Goodwill formed by the merger of Borit:
In 2020, the Company acquired 100.00% equity of Borit in the form of cash purchase, the goodwill was the part of the merge cost
74
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
greater than the fair value share of the identifiable net assets of Borit.
19. Long-term deferred expense
In RMB
Item Opening balance Current increased Amortized in the Period Other decrease Ending balance
Remodeling costs etc. 28,586,235.84 648,309.32 2,091,207.90 27,143,337.26
Total 28,586,235.84 648,309.32 2,091,207.90 27,143,337.26
20. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets that are not offset
In RMB
Ending balance Opening balance
Item Deductible temporary Deferred income Deductible temporary Deferred income
difference tax assets difference tax assets
Unrealized profit from insider
45,296,516.40 8,088,715.43 43,939,348.59 8,056,161.37
transactions
Deductible loss 933,763,077.77 140,064,461.66 942,706,826.57 142,138,790.82
Provision for bad debts 79,963,291.96 12,080,980.69 79,078,766.93 11,972,961.27
Inventory depreciation reserve 289,774,907.65 44,812,137.50 299,752,548.93 46,412,618.47
Depreciation reserves of fixed
69,791,042.37 12,669,293.88 70,008,612.21 12,701,929.36
assets
Depreciation reserves of intangible
16,646,900.00 2,497,035.00 16,646,900.00 2,497,035.00
assets
Deferred income 192,321,983.67 29,071,265.00 222,850,907.79 33,668,167.75
Payable salary, accrued expenses
815,381,382.95 145,505,140.26 849,436,667.00 139,593,056.66
etc.
Differences in asset depreciation
22,846,772.82 3,716,162.25 25,570,352.82 4,153,581.52
and amortization
Equity incentive 36,048,963.14 5,527,217.76 3,066,582.11 459,987.32
Fiscal and tax differences for
1,634,506.39 284,789.34 1,345,462.74 234,721.68
leasing business
Total 2,503,469,345.12 404,317,198.77 2,554,402,975.69 401,889,011.22
(2) Deferred income tax liabilities that are not offset
In RMB
Ending balance Opening balance
Item Taxable temporary Deferred income Taxable temporary Deferred income
differences tax liabilities differences tax liabilities
The difference between the fair value and taxation basis of
WFTT assets in merger not under the same control 9,958,382.35 1,493,757.33 10,192,264.15 1,528,839.60
The difference between the fair value and taxation basis of
IRD assets in merger not under the same control 59,677,693.03 13,129,092.46 61,131,061.24 13,448,833.47
The difference between the fair value and taxation basis of
Borit assets in merger not under the same control 18,072,610.25 4,518,152.58 21,378,918.49 5,344,729.59
The difference between the fair value and taxation basis of
57,938,669.62 13,905,280.76 59,291,649.88 14,229,995.98
VH business in merger not under the same control
Change of fair value of transaction financial asset 136,564,271.14 20,484,640.67 161,415,403.78 24,226,534.89
Accelerated depreciation of fixed assets 760,672,604.44 116,650,472.33 700,548,497.31 107,631,856.23
Total 1,042,884,230.83 170,181,396.13 1,013,957,794.85 166,410,789.76
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WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB
Trade-off between Ending balance of Trade-off between the Opening balance of
the deferred deferred income tax deferred income tax deferred income tax
Item
income tax assets assets or liabilities after assets and liabilities at assets or liabilities after
and liabilities off-set period-begin off-set
Deferred income tax assets -130,408,867.62 273,908,331.15 -126,261,238.77 275,627,772.45
Deferred income tax
-130,408,867.62 39,772,528.51 -126,261,238.77 40,149,550.99
liabilities
(4) Details of unrecognized deferred income tax assets
In RMB
Item Ending balance Opening balance
Provision for bad debts 1,648,744,605.59 1,648,602,163.32
Inventory depreciation reserve 33,651,705.97 34,557,558.55
Loss from subsidiary 650,732,385.24 529,884,134.82
Depreciation reserves of fixed assets 136,569,035.05 129,931,549.17
Depreciation reserves of intangible assets 469,227.48 442,167.30
Other equity instrument investment 13,600,000.00 13,600,000.00
Equity incentive 412,188.43
Total 2,484,179,147.76 2,357,017,573.16
(5) Deductible losses of unrecognized deferred income tax assets expired in following years
In RMB
Maturity year Ending amount Opening amount Note
2023 2,380,501.89 2,380,501.89 Domestic subsidiaries have operating losses
2024 7,241,959.80 12,087,441.12 Domestic subsidiaries have operating losses
2025 12,140,693.54 12,140,693.54 Domestic subsidiaries have operating losses
2026 46,263,839.94 46,418,486.83 Domestic subsidiaries have operating losses
2027 160,833,781.13 160,833,781.13 Domestic subsidiaries have operating losses
2028 and the following years 84,832,478.65 Domestic subsidiaries have operating losses
No expiration period 337,039,130.29 296,023,230.31 Overseas subsidiaries have operating losses
Total 650,732,385.24 529,884,134.82
21. Other non-current assets
In RMB
Ending balance Opening balance
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Contract
17,527,137.42 17,527,137.42 19,855,422.27 19,855,422.27
acquisition cost
Engineering
equipment paid in 284,280,950.81 284,280,950.81 239,775,014.10 239,775,014.10
advance
76
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Large deposit
certificates with a
310,000,000.00 310,000,000.00 220,000,000.00 220,000,000.00
maturity of more
than one year
Total 611,808,088.23 611,808,088.23 479,630,436.37 479,630,436.37
22. Short-term borrowings
(1) Category of short-term borrowings
In RMB
Item Ending balance Opening balance
Guaranteed Loan 89,074,800.00
Credit loan 2,054,773,697.36 3,511,504,373.65
Pledged loan 200,000,000.00
Accrued interest 2,127,228.09 3,797,354.17
Total 2,256,900,925.45 3,604,376,527.82
Other explanation:
To obtain the pledged notes receivable of 200,000,000.00 yuan for the above-mentioned bank loan.
(2) Overdue short-term loans without payment
Nil
23. Derivative financial liabilities
In RMB
Item Ending balance Opening balance
Forward settlement and sales of foreign exchange 737,424.50 747,115.75
Total 737,424.50 747,115.75
24. Note payable
In RMB
Category Ending balance Opening balance
Bank acceptance bill 1,584,124,651.19 1,411,089,606.00
Total 1,584,124,651.19 1,411,089,606.00
At the end of the current period, the total amount of matured but unpaid notes payable is 0.00 yuan.
Other explanation:
To issue the above-mentioned bank acceptance bill, a deposit of 12,066,812.90 yuan was paid, and the pledged notes receivable
were 663,438,206.29 yuan.
77
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
25. Account payable
(1) Account payable
In RMB
Item Ending balance Opening balance
Within 1 year 2,983,935,371.31 3,165,855,712.48
1-2 years 191,485,742.18 207,702,168.86
2-3 years 39,761,626.79 31,919,163.40
Over 3 years 56,743,490.72 49,123,978.86
Total 3,271,926,231.00 3,454,601,023.60
(2) Important account payable with account age over one year
Nil
26. Advance payment
(1) Advance payment
In RMB
Item Ending balance Opening balance
Within 1 year 462,221.88 3,633,878.33
Total 462,221.88 3,633,878.33
(2) Important advance payment with account age over one year
Nil
27. Contract liabilities
In RMB
Item Ending balance Opening balance
Within 1 year 72,243,802.82 60,916,157.84
1-2 years 26,134,497.08 31,275,903.90
2-3 years 4,222,503.89 1,518,759.78
Over 3 years 1,890,920.75 1,139,261.71
Total 104,491,724.54 94,850,083.23
28. Wage payable
(1) Wage payable
In RMB
Item Opening balance Current increased Current decreased Ending balance
1. Short-term compensation 241,874,758.99 654,939,146.08 728,406,774.16 168,407,130.91
2. Post-employment welfare- defined contribution
27,678,116.81 98,215,720.30 110,550,601.42 15,343,235.69
plans
78
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
3. Dismissed welfare 973,200.33 318,149.00 318,149.00 973,200.33
4. Incentive funds paid within a year 30,740,000.00 5,404,350.26 25,335,649.74
5. Other short-term welfare-Housing
subsidies, employee benefits and welfare 16,168,310.11 542,875.00 15,625,435.11
funds
Total 317,434,386.24 753,473,015.38 845,222,749.84 225,684,651.78
(2) Short-term compensation
In RMB
Item Opening balance Current increased Current decreased Ending balance
1. Wages, bonuses, allowances and
228,262,797.86 529,286,322.08 603,220,806.67 154,328,313.27
subsidies
2. Welfare for workers and staff 36,075,847.78 35,585,722.75 490,125.03
3. Social insurance 279,543.63 32,083,598.82 31,216,372.33 1,146,770.12
Including: Medical insurance 242,824.57 25,901,593.15 25,090,210.55 1,054,207.17
Work injury insurance 27,398.20 3,325,804.39 3,303,611.91 49,590.68
Maternity insurance 9,320.86 2,856,201.28 2,822,549.87 42,972.27
4. Housing accumulation fund 785,727.00 42,865,346.16 42,397,860.00 1,253,213.16
5. Labor union expenditure and
9,960,112.99 7,341,838.52 7,496,411.82 9,805,539.69
personnel education expense
6. Other short-term compensation -
2,586,577.51 7,286,192.72 8,489,600.59 1,383,169.64
social security
Total 241,874,758.99 654,939,146.08 728,406,774.16 168,407,130.91
(3) Define contribution plans
In RMB
Item Opening balance Current increased Current decreased Ending balance
1. Basic endowment premium 6,829,377.95 77,731,981.00 80,384,478.75 4,176,880.20
2. Unemployment insurance 36,478.41 2,106,036.83 2,097,337.90 45,177.34
3. Enterprise annuity 20,812,260.45 18,377,702.47 28,068,784.77 11,121,178.15
Total 27,678,116.81 98,215,720.30 110,550,601.42 15,343,235.69
29. Tax payable
In RMB
Item Ending balance Opening balance
Value-added tax 27,283,192.13 27,961,474.84
Corporation income tax 21,442,470.99 7,847,731.79
Individual income tax 436,400.85 6,846,289.60
City maintaining & construction tax 1,910,545.77 1,546,043.92
Educational surtax 1,366,061.64 1,105,937.33
Other (including stamp tax and local funds) 11,719,986.78 9,278,838.05
Total 64,158,658.16 54,586,315.53
30. Other account payable
In RMB
79
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Item Ending balance Opening balance
Dividends payable 10,373,454.00
Other accounts payable 146,355,991.68 198,990,948.23
Total 156,729,445.68 198,990,948.23
(1) Interest payable
Nil
(2) Dividends payable
In RMB
Item Ending balance Opening balance
Common stock dividends 10,373,454.00
Total 10,373,454.00
Other explanations, including important dividends payable that have not been paid for more than one year, disclose the reason for
not paying such dividends: Nil
(3) Other account payable
1) Classification of other accounts payable according to nature of account
In RMB
Item Ending balance Opening balance
Deposit and margin 34,168,117.02 15,452,400.65
Withholding social insurance and reserves funds 1,609,945.43 1,967,741.92
Intercourse funds of unit 25,512,145.98 25,512,145.98
Restricted stock repurchase obligations 68,688,180.00 138,495,060.00
Payable unpaid investment funds 14,105,360.83 13,308,176.65
Other 2,272,242.42 4,255,423.03
Total 146,355,991.68 198,990,948.23
2) Significant other payable with over one year
In RMB
Item Ending balance Reasons for non-repayment or carry-over
Nanjing Jidian Industrial Group Co., Ltd. 4,500,000.00 Intercourse funds
Restricted stock repurchase obligation 68,688,180.00 Restricted stock repurchase business
Total 73,188,180.00
31. Non-current liabilities due within one year
In RMB
Item Ending balance Opening balance
Long-term borrowings due within one year 25,000,000.00 2,000,000.00
Lease payments due within one year 11,778,509.11 12,044,793.34
Interest payable 180,555.56 240,555.56
Total 36,959,064.67 14,285,348.90
80
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
32. Other current liabilities
In RMB
Item Ending balance Opening balance
Rebate payable 252,281,512.29 201,734,082.52
Pending sales tax 10,368,705.25 8,815,298.56
Endorsed/discounted undue bills 1,214,398.69
Total 262,650,217.54 211,763,779.77
Changes in short-term bonds payable: Nil
33. Long-term borrowings
(1) Category of long-term borrowings
In RMB
Item Ending balance Opening balance
Guaranteed loan 600,000,000.00 238,000,000.00
Total 600,000,000.00 238,000,000.00
34. Lease liability
In RMB
Item Ending balance Opening balance
Lease payments 30,799,799.49 31,589,277.20
Total 30,799,799.49 31,589,277.20
35. Long-term account payable
In RMB
Item Ending balance Opening balance
Long-term account payable 12,520,000.00 12,520,000.00
Special accounts payable 18,265,082.11 18,265,082.11
Total 30,785,082.11 30,785,082.11
(1) Long-term account payable listed by nature
In RMB
Item Ending balance Opening balance
Hi-tech Branch of Nanjing Finance Bureau (note ①) Financial support funds (2008) 2,750,000.00 2,750,000.00
Hi-tech Branch of Nanjing Finance Bureau (note ②) Financial support funds (2009) 1,030,000.00 1,030,000.00
Hi-tech Branch of Nanjing Finance Bureau (note ③) Financial support funds (2010) 960,000.00 960,000.00
Hi-tech Branch of Nanjing Finance Bureau (note ④) Financial support funds (2011) 5,040,000.00 5,040,000.00
Hi-tech Branch of Nanjing Finance Bureau (note ⑤) Financial support funds (2013) 2,740,000.00 2,740,000.00
Total 12,520,000.00 12,520,000.00
Other explanation:
Note ①: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is
allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from November 10, 2008 to November 10,
2023. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
Note②: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is
allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from October 27, 2009 to October 27,
81
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2024. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
Note③: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is
allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from December 27, 2010 to December 27,
2025. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
Note④: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is
allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from December 28, 2011 to December 28,
2026. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
Note⑤: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is
allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from December 18, 2013 to December 18,
2028. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
(2) Special accounts payable
In RMB
Cause of
Item Opening balance Current increased Current decreased Ending balance
formation
Removal
compensation of 18,265,082.11 18,265,082.11
subsidiary WFJN
Total 18,265,082.11 18,265,082.11
Other explanation
In line with regulation of the house acquisition decision of People’s government of Xuanwu District, Nanjing City, Ning Xuan Fu
Zheng Zi (2012) No.001, part of the lands and property of WFJN needs expropriation in order to carry out the comprehensively
improvement of Ming Great Wall. According to the house expropriation and compensation agreement in state-owned lands signed
between WFJN and House Expropriation Management Office of Xuanwu District, Nanjing City, 19,706,700.00 yuan in total are
compensate, including operation losses from lessee 1,441,600.00 yuan in total. The above compensation was received in last
period and is making up for the losses from lessee, and the above lands and property have not been collected up to June 30, 2023.
36. Long-term wages payable
(1) Long-term wages payable
In RMB
Item Ending balance Opening balance
1. Post-employment benefits - Defined
21,989,427.11 20,380,744.73
benefit plan net liabilities
2. Dismiss welfare 12,312,197.60 12,028,538.66
3. Other long-term welfare 121,683,760.89 121,683,760.89
Total 155,985,385.60 154,093,044.28
(2) Defined benefit plan
Present value of defined benefit plan:
In RMB
Item Amount in current period Amount in last period
1. Opening balance 20,380,744.73 19,594,011.39
2. Cost of defined benefit plan booked into current profit and loss 385,952.19 38,706.27
82
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(1) Current service cost 385,952.19 38,706.27
3. Cost of defined benefit plan booked into other comprehensive
704,649.43 399,165.06
income
(1) Actuarial gains (losses are represented by “-”) 704,649.43 399,165.06
4. Other changes 518,080.76 348,862.01
(1) Welfare paid -99,925.69 -345,481.69
(2) Translation difference of foreign currency statements 618,006.45 694,343.70
5. Ending balance 21,989,427.11 20,380,744.73
Other explanation:
According to relevant regulations in Italy, the Trattamento di Fine Rapporto (TFR) system is established. VHIO shall withdraw
severance to employees in accordance with employees’ employment period and taxable base salary when they leave or are
dismissed. The plan predicts future cash outflows at the inflation rate and determines its present value at the discount rate. The
above-mentioned benefit plan poses actuarial risks to VHIO, mainly including interest rate risk and inflation risk. In case interest
rate is cut down, the present value of the defined benefit plan obligations will rise. In addition, the present value of benefit plan
obligations is related to the future payment standards of the plan, which are determined based on inflation rates. Therefore, the
upward inflation rate will also lead to rising planned liabilities.
37. Anticipated liability
In RMB
Item Ending balance Opening balance Formation cause
Pending litigation 246,653.02
Product quality assurance 9,980,678.92 8,695,322.61
Investment losses in joint ventures 13,750.00
Environmental protection commitment 1,150,543.24
Total 9,980,678.92 10,106,268.87
Other explanations, including important assumptions and estimation explanations related to significant estimated liabilities: Nil
38. Deferred income
In RMB
Item Opening balance Current increased Current decreased Ending balance Cause of formation
Government grant 223,123,978.78 14,325,532.64 38,239,740.37 199,209,771.05
Total 223,123,978.78 14,325,532.64 38,239,740.37 199,209,771.05 --
Item with government grants involved:
In RMB
Amount Cost
Amount Assets
New grants reckoned reducti Other
Opening reckoned into related/In
Items of liabilities in the in non- on in change Ending balance
balance other income come
Period operation the s
in the period related
revenue period
Industrialization project
for injection VE pump
system with Asset
electronically controlled 5,536,697.24 390,825.70 5,145,871.54
related
high pressure for less-
emission diesel used
Fund of industry upgrade Income
(2013) 16,399,408.5 related
18,710,191.69 2,310,783.15
4
83
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
R&D and
industrialization of the
high-pressure variable Assets
pump of the common rail 2,699,860.97 506,584.28 2,193,276.69
related
system of diesel engine
for automotive
Research institute of
motor vehicle exhaust Assets
post-processing 117,789.93 44,915.68 72,874.25
related
technology
Fund of industry upgrade Income
(2014) 36,831,000.00 36,831,000.00
related
New-built assets
compensation after the Assets
removal of parent 63,443,087.73 8,961,973.65 54,481,114.08
related
company
Fund of industry upgrade Income
(2016) 40,000,000.00 40,000,000.00
related
Guiding capital for the
technical reform from Assets
State Hi-Tech Technical 3,787,113.97 607,212.50 3,179,901.47
related
Commission
Implementation of the
variable cross-section Assets
turbocharger for diesel 4,254,433.18 774,340.08 3,480,093.10
related
engine
Demonstration project
Assets
funds for intelligent 431,887.80 90,019.10 341,868.70
manufacturing related
The 2nd batch of
provincial special funds
for industry Assets
transformation of 1,849,844.13 611,563.78 1,238,280.35
related
industrial and
information in 2019
Municipal technological
Assets
reform fund allocation in 3,527,096.61 307,948.54 3,219,148.07
2020 related
Strategic cooperation
agreement funding for
Assets
key enterprise of smart 3,374,618.86 416,578.38 2,958,040.48
manufacturing in high- related
tech zone
The 3rd batch of
provincial special funds
for industry Assets
transformation of 13,500,000.00 13,500,000.00
related
industrial and
information in 2021
Assets
14,121,035. 204,49 related/In
Other 25,060,356.67 9,128,370.14 30,257,519.17
85 6.79 come
related
Assets
14,121,035. 38,239,740.3 204,49 related/In
Total 223,123,978.78 199,209,771.05
85 7 6.79 come
related
Other explanation:
(1) The appropriation for research and development ability of distributive high-pressure common rail system for diesel engine use
and production line technological transformation project: according to the document (XCJNo. [2010]59), the Company has received
special funds of 7.1 million yuan appropriated by Finance Bureau of Wuxi New District in 2011 and used for the Company’s
research and development ability of distributive high-pressure common rail system for diesel engine use and production line
technological transformation project; this appropriation belongs to government grants related to assets, amount of 390,825.70 yuan
was written off based on the depreciation schedule of the related assets during the period.
84
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Industry upgrading funds (2013): In accordance with the documents XXGJF [2013] No.379, XXGJF [2013] No.455, XXGCF
[2013] No.128 and XXGCF[2013] No.153, the Company received funds of 60.52 million yuan appropriated for industry upgrading
in 2013 and amount of 16,399,408.54 yuan was written off in the year.
(3) R&D and industrialization of the high pressure variable pump of the common rail system of diesel engine for automotive: the
Company received appropriated for the project in 2013 with 8.05 million yuan in line with documents XKJ[2013] No.186, XK
J[2013] No.208, XCGM[2013] No.104, XCGM [2013] No.138, XKJ [2014] No.125, XCGM[2014] No.58, XKJ[2014] No. 246 and
XCGM[2014] No.162. The company received 8.05 million yuan, 3 million yuan and 0.45 million yuan respectively in 2013, 2014
and 2015; such funds belong to government grant with assets concerned, and shall be written off according to the depreciation
process, amount of 506,584.28 yuan was written off in reporting period.
(4) Automotive exhaust post-processing technology research institute project: in 2012, the subsidiary WFLD has applied for
equipment purchase assisting funds to Wuxi Huishan Science and Technology Bureau and Wuxi Science and Technology Bureau for
the automobile vehicle exhaust post-processing technology research institute project. This declaration has been approved by Wuxi
Huishan Science and Technology Bureau and Wuxi Science and Technology Bureau in 2012, and the company has received
appropriation of 2.4 million yuan in 2012, and received appropriation of 1.6 million yuan in 2013. This appropriation belongs to
government grants related to assets and will be written off according to the depreciation process, amount of 44,915.68 yuan was
written off in the year.
(5) Industry upgrading funds (2014): In accordance with the document XXGJF [2014] No.427 and XXGCF[2014] No.143, the
Company received funds of 36.831 million yuan appropriated for industry upgrading in 2014.
(6) New-built assets compensation after the removal of parent company: policy relocation compensation received by the Company,
and will be written off according to the depreciation of new-built assets, amount of 8,961,973.65 yuan was written off in reporting
period.
(7) Fund of industry upgrade (2016): In accordance with the document XXGJF [2016] No.585 and XXF[2016] No.70, the Company
received funds of 40.00 million yuan appropriated for industry upgrading in 2016.
(8) Guiding capital for the technical reform from State Hi-Tech Technical Commission: In accordance with the document XJXZH
[2016] No.9 and XCGM [2016] No.56, the Company received a 9.74 million yuan for the guiding capital of technical reform (1 st
batch) from Wuxi for year of 2016, and belongs to government grant with assets concerned, and shall be written off according to the
depreciation process, amount of 607,212.50 yuan was written off in reporting period.
(9) Implementation of the variable cross-section turbocharger for diesel engine: In accordance with the document YCZF[2016]
No.623 and “Strong Industrial Base Project Contract for year of 2017”, subsidiary WFTT received a specific subsidy of 16.97
million yuan in 2016 and of 760,000 yuan in 2018, the fund supporting strong industrial base project (made-in-China 2025) of
central industrial transformation and upgrading 2016 from Ministry of Industry and Information Technology; It belongs to
government grant with assets concerned, and shall be written off according to the depreciation process. Amount of 774,340.08 yuan
was written off in reporting period.
(10) Demonstration project for intelligent manufacturing: under the Notice Relating to Selection of the Intelligent Manufacturing
Model Project in Huishan District in 2016 (HJXF[2016]No.36), a fiscal subsidy of 3,000,000 yuan was granted by relevant
government authority in Huishan district to our subsidiary WFLD in 2017 to be utilized for transformation and upgrade of WFLD’s
intelligent manufacturing facilities. This subsidy belongs to government grant related to assets which shall be written off based on the
depreciation progress of the assets. Amount of 90,019.10 yuan was written off in reporting period..
(11) The 2nd batch of provincial special funds for industry transformation of industrial and information in 2019: according to XCGM
[2019] No.121, the Company received a special fund of 5.00 million yuan in 2020..This subsidy was related to the “Weifu High-
Technology New Factory Internet Construction” projects, and belonged to government grants related to assets. and shall be written
off according to the depreciation process, amount of 611,563.78 yuan was written off in the reporting period.
(12) Municipal technological reform fund allocation in 2020: according to XGXZH [2020]No.16, the Company received 4.77 million
yuan of municipal technological transformation fund project allocation in 2020, which was related to key technological
85
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
transformation projects and belonged to government grants related to assets. and shall be written off according to the depreciation
process. Amount of 307,948.54 yuan was written off in reporting period.
(13) Strategic cooperation agreement funding for key enterprise of smart manufacturing in high-tech zone: according to XXGXF
[2020]No.61, the Company received a related grant of 4.06 million yuan in 2020 and 0.7 million yuan received in reporting period.
This grant was related to the intelligent transformation project and belonged to the government grants related to assets. and shall be
written off according to the depreciation process, amount of 416,578.38 yuan was written off in reporting period.
(14) The 3rd batch of provincial special funds for industry transformation of industrial and information in 2021: according to the
SCGM[2021]No.92, the government grant 13.5 million yuan received in 2021 was for the research, development and
industrialization of membrane electrodes for high-performance automotive proton exchange membrane fuel cells, which was an
assets related government grants.
39. Share
In RMB
Change during the year (+/-)
Shares
Opening balance New Ending balance
Bonus transferred
shares Other Subtotal
share from capital
issued
reserve
Total shares 1,008,603,293.00 -6,023,500.00 -6,023,500.00 1,002,579,793.00
Other explanation:
Decreased in share capital was due to the buy-back and cancellation of 430,000 restricted shares initially granted under the Restricted
Shares Incentive Plan for year of 2020 and 5,593,500 restricted stocks that did not meet the unlocking conditions.
40. Capital reserve
In RMB
Item Opening balance Current increased Current decreased Ending balance
Capital premium (Share capital premium) 3,318,949,527.98 5,416.66 68,558,795.09 3,250,396,149.55
Other Capital reserve 79,419,039.65 5,361,906.64 84,780,946.29
Total 3,398,368,567.63 5,367,323.30 68,558,795.09 3,335,177,095.84
Other explanation, including changes in the period and reasons for changes;
(1) Share capital premium rose by 5,416.66 yuan in the reporting period, mainly due to excessive investment funds paid by IRD to
WFQL; Share capital premium reduced by 68,558,795.09 yuan, due to the share capital premium transferred-in, 68,547,430.00 yuan,
arising from for 6,023,500 restricted stock which were canceled by the Company. The difference, 11,365.09 yuan, is the handle fee
of repurchase and cancellation.
(2) Other capital reserve rose by 5,361,906.64 yuan in the reporting period, which is a net amount after deducting 160,173.01 yuan of
attributable to minority from 5,522,079.65 yuan of the expenses of equity-settled share-based payment.
41. Treasury stock
In RMB
Item Opening balance Current increased Current decreased Ending balance
Share repurchase 397,804,542.63 71,917,549.61 469,722,092.24
86
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Repurchase obligation of restricted stock
143,818,460.00 75,130,280.00 68,688,180.00
incentive plan
Total 541,623,002.63 71,917,549.61 75,130,280.00 538,410,272.24
Other explanations, including changes in the current period and explanations of the reasons for the changes:
Share repurchase: rose by 71,917,549.61 yuan in the reporting period due to share repurchase by way of centralized bidding;
Repurchase obligation of restricted stock incentive plan: The decrease of 75130280.00 yuan in this period is composed of two parts:
①reduced by 74,570,930.00 yuan in the reporting period due to the treasury stock as the company repurchased and canceled
6,023,500.00 restricted shares; ②559,350.00 yuan is the cash dividend received by the restricted stock incentive object in the
reporting period.
42. Other comprehensive income
In RMB
Current period
Less: written Less: written
in other in other
comprehensiv comprehensiv
e income in e income in Less: Belong to
Opening Account before previous previous incom Belong to parent minority
Item Ending balance
balance income tax in period and period and e tax company after sharehold
the year carried carried expen tax ers after
forward to forward to se tax
gains and retained
losses in earnings in
current period current period
1. Other
comprehensive
income that
cannot be -383,156.26 -305,484.37 -305,484.37 -688,640.63
reclassified to
profit or loss
Including:Remeas
ure changes in
defined benefit -399,165.06 -305,484.37 -305,484.37 -704,649.43
plans
Other
comprehensive
income that
cannot be
transferred to 16,008.80 16,008.80
profit or loss
under the equity
method
2. Other
comprehensive
income items
which will be -528,153.87 61,545,045.56 61,545,045.56 61,016,891.69
reclassified
subsequently to
profit or loss
Conversion
difference of
foreign currency -528,153.87 61,545,045.56 61,545,045.56 61,016,891.69
financial
statement
Total other
comprehensive -911,310.13 61,239,561.19 61,239,561.19 60,328,251.06
income
43. Reasonable reserve
In RMB
87
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Item Opening balance Current increased Current decreased Ending balance
Work safety expense 2,119,800.95 14,709,266.91 13,245,660.11 3,583,407.75
Total 2,119,800.95 14,709,266.91 13,245,660.11 3,583,407.75
Other explanation, including changes and reasons for changes:
(1) Description on withdrawing reasonable reserves (work safety expense): According to the Administrative Measures on the
Withdrawing and Use of Enterprise Work Safety Expense(CZ[2022]No.136) jointly issued by the Ministry of Finance and the State
Administration of Work Safety, in the reporting period, based on the actual operating income of the previous period, the company
adopted excess retreat method to define the amount of reasonable reserve of the year and withdraw reasonable reserve averagely in
each month..
(2) The above work safety expenses included those withdrawn by the Company in line with regulations and the parts enjoyed by
shareholders of the Company in work safety expenses withdrawn by subsidiary in line with regulations.
44. Surplus reserve
In RMB
Item Opening balance Current increased Current decreased Ending balance
Statutory surplus
510,100,496.00 510,100,496.00
reserves
Total 510,100,496.00 510,100,496.00
Other explanation, including changes and reasons for changes:
Withdrawal of the statutory surplus reserves: Pursuit to the Company Law and Article of Association, the Company withdraws
statutory surplus reserve in terms of 10% of the net profit. No more amounts shall be withdrawn if the accumulated statutory surplus
reserve is over 50% of the registered capital.
45. Retained profit
In RMB
Amount in current Amount in last
Item
period period
Retained profits at the end of last period before adjustment 13,320,021,325.90 14,814,787,377.86
Retained profits at the beginning of the period after adjustment 13,320,021,325.90 14,814,787,377.86
Add: The net profits belong to owners of patent company of the reporting period 948,760,859.55 118,819,836.30
Less: Cash dividends payable 97,757,979.30 1,609,059,668.80
Less: Withdraw employee rewards and welfare funds 4,526,219.46
Retained profit at period-end 14,171,024,206.15 13,320,021,325.90
Details about adjusting the retained profits at the beginning of the period:
1) The retroactive adjustments due to the Accounting Standards for Business Enterprises and its relevant new regulations affect the
retained profits at the beginning of the period amounting to 0 yuan.
2) The changes in accounting policies affect the retained profits at the beginning of the period amounting to 0 yuan.
3) The major accounting error correction affects the retained profits at the beginning of the period amounting to 0 yuan
4) Merge scope changes caused by the same control affect the retained profits at the beginning of the period amounting to 0 yuan.
5) Other adjustments affect the retained profits at the beginning of the period amounting to 0 yuan
46. Operating income and cost
In RMB
Item Amount in current period Amount in last period
88
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Income Cost Income Cost
Main operating 6,052,163,689.76 5,137,115,309.66 6,928,141,770.13 5,860,429,899.49
Other business 77,485,357.64 26,756,421.60 209,031,087.84 166,024,282.54
Total 6,129,649,047.40 5,163,871,731.26 7,137,172,857.97 6,026,454,182.03
Other explanation
Top 5 revenue confirmed during the reporting period:
In RMB
Serial No. Name Revenue
1 RBCD 1,090,789,696.99
2 Robert Bosch Company 848,768,368.36
3 Client 1 370,384,276.77
4 Client 4 252,642,028.88
5 Client 2 178,558,893.41
47. Operating tax and extra
In RMB
Item Amount in current period Amount in last period
City maintaining & construction tax 8,517,861.49 8,634,987.02
Educational surtax 6,087,805.08 6,170,777.25
Property tax 11,115,997.34 8,897,091.90
Land use tax 2,013,933.93 2,253,305.65
Vehicle use tax 19,170.06 3,985.52
Stamp duty 4,119,912.74 2,394,141.59
Other taxes 365,742.35 523,132.85
Total 32,240,422.99 28,877,421.78
48. Sales expenses
In RMB
Item Amount in current period Amount in last period
Salary and wage related expense 33,589,826.19 24,952,862.28
Consumption of office materials and
5,356,063.20 3,302,587.07
business travel charge
Warehouse charge 3,818,351.46 1,044,900.83
Three guarantees and quality cost 38,356,321.13 30,734,960.85
Business entertainment fee 5,701,496.43 9,087,067.46
Other 16,209,422.99 9,898,213.94
Total 103,031,481.40 79,020,592.43
49. Administration expenses
In RMB
Item Amount in current period Amount in last period
Salary and wage related expense 157,699,092.98 151,774,582.74
Depreciation charger and long-term
53,460,774.32 37,588,034.10
assets amortization
Consumption of office materials and 9,690,794.26 6,085,675.94
89
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
business travel charge
Share-based payment 3,351,570.96 22,799,516.92
Other 74,993,497.07 58,964,445.09
Total 299,195,729.59 277,212,254.79
50. R&D expenses
In RMB
Item Amount in current period Amount in last period
Technological development expenses 351,887,038.12 289,631,376.50
Total 351,887,038.12 289,631,376.50
51. Financial expenses
In RMB
Item Amount in current period Amount in last period
Interest expenses 65,616,425.64 34,275,262.65
Note discount interest expenses 3,052,594.14
Less: Deposit interest income 15,706,416.56 13,927,929.36
Gains/losses from exchange -14,651,449.58 4,316,196.05
Handling charges 3,203,622.95 2,057,941.09
Total 38,462,182.45 29,774,064.57
52. Other income
In RMB
Sources of income generated Amount in current period Amount in last period
Government grants with routine operation activity concerned 40,157,408.73 25,101,731.50
Refund of individual income tax handling fee 822,184.78 993,890.43
Total 40,979,593.51 26,095,621.93
53. Investment income
In RMB
Item Amount in current period Amount in last period
Income of long-term equity investment calculated based on equity 742,783,514.37 823,400,731.10
Investment income from disposal of long-term equity investments 964,645.90
Investment income from wealth management products 69,978,714.96 105,107,324.41
Other -1,355,595.84 -680,357.44
Total 811,406,633.49 928,792,343.97
54. Income from change of fair value
In RMB
Sources Amount in current period Amount in last period
Changes in the fair value of wealth management products 2,673,177.12 3,290,951.54
Changes in the fair value of the stocks of listed companies held-
-20,742,730.41 -77,723,879.68
excluding the stocks of listed companies that are included in other
90
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
equity instrument investments
Total -18,069,553.29 -74,432,928.14
55. Credit impairment loss
In RMB
Item Amount in current period Amount in last period
Bad debt loss -846,725.76 2,083,427.81
Total -846,725.76 2,083,427.81
56. Asset impairment loss
In RMB
Item Amount in current period Amount in last period
Loss of inventory falling price and loss of
-89,988,541.10 -104,219,783.98
contract performance cost impairment
Impairment loss of fixed assets -274,995.90
Total -90,263,537.00 -104,219,783.98
57. Income form assets disposal
In RMB
Sources Amount in current period Amount in last period
Income from disposal of non-current assets 126,476,687.75 3,597,231.29
Losses from disposal of non-current assets -945,782.71 -1,706,951.34
Total 125,530,905.04 1,890,279.95
58. Non-operating income
In RMB
Amount reckoned into current
Item Amount in current period Amount in last period
extraordinary gains and losses
Other 2,707,696.00 218,285.29 2,707,696.00
Total 2,707,696.00 218,285.29 2,707,696.00
Government grants included in the current profit and loss: Nil
59. Non-operating expense
In RMB
Amount reckoned into current
Item Amount in current period Amount in last period
extraordinary gains and losses
Donation 20,000.00 20,000.00
Total of loss on scrapping of
661,923.94 2,175,378.87 661,923.94
fixed assets
Including: loss on scrapping
661,923.94 2,175,378.87 661,923.94
of fixed assets
Other 76,457.75 21,187.00 76,457.75
Total 758,381.69 2,196,565.87 758,381.69
91
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
60. Income tax expense
(1) Income tax expense
In RMB
Item Amount in current period Amount in last period
Payable tax in current period 29,859,646.45 62,009,331.28
Adjusted the previous income tax -11,522.40 281,934.62
Increase/decrease of deferred income tax assets -3,637,244.56 6,279,057.80
Increase/decrease of deferred income tax liability 3,121,400.25 -12,925,247.95
Total 29,332,279.74 55,645,075.75
(2) Adjustment on accounting profit and income tax expenses
In RMB
Item Amount in current period
Total profit 1,011,647,091.89
Income tax measured by statutory/applicable tax rate 151,747,063.78
Impact by different tax rate applied by subsidies -8,162,395.90
Adjusted the previous income tax -11,522.40
Impact by non-taxable revenue -104,839,090.93
Impact by cost, expenses and losses that unable to deducted -712,332.26
Impact by the deductible losses of the un-recognized previous deferred income tax 31,658,172.36
The deductible temporary differences or deductible losses of the un-recognized deferred
-36,789,640.73
income tax assets in the Period
Impact on additional deduction -4,057,984.09
Other 500,009.91
Income tax expense 29,332,279.74
61. Other comprehensive income
See Note VII. 42. “Other comprehensive income”
62. Items of cash flow statement
(1) Other cash received in relation to operation activities
In RMB
Item Amount in current period Amount in last period
Interest income 15,706,416.56 13,927,929.36
Government grants 16,848,073.14 8,106,249.87
Fund inflow from WFTR “platform trade” business 299,235,761.25 1,254,515,797.22
Other 18,644,560.72 404,502.49
Total 350,434,811.67 1,276,954,478.94
Explanation on other cash received in relation to operation activities: Nil
(2) Other cash paid in relation to operation activities
In RMB
92
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Item Amount in current period Amount in last period
Cash cost 301,149,590.30 254,434,197.77
Fund outflow from WFTR “platform trade” business 100,000,000.00 4,442,956,606.35
Other 8,281,394.08 18,468,018.35
Total 409,430,984.38 4,715,858,822.47
Explanation to other cash paid in relation to operation activities:
The amount of fund outflow from WFTR “platform trade” business in current period is the final payment of the business before
the Company discovered the contract fraud.
(3) Cash received from other investment activities
Nil
(4) Cash paid related with investment activities
Nil
(5) Other cash received in relation to financing activities
Nil
(6) Cash paid related with financing activities
In RMB
Item Amount in current period Amount in last period
Lease payments 3,411,636.27 865,486.76
Payment for stock repurchase 71,917,549.61 100,001,057.07
Payment for restricted stock repurchase 69,247,530.00
Total 144,576,715.88 100,866,543.83
Explanation to other cash paid related with financing activities: Nil
63. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB
Amount in current Amount in last
Supplementary information
period period
1. Net profit adjusted to cash flow of operation activities:
Net profit 982,314,812.15 1,128,788,571.08
Add: Assets impairment provision 91,110,262.76 102,136,356.17
Depreciation of fixed assets, consumption of oil assets and depreciation of
259,623,099.39 203,750,978.31
productive biology assets
Depreciation of right-of-use assets 6,380,517.86 2,124,980.42
Amortization of intangible assets 32,426,362.30 21,643,638.80
Amortization of long-term deferred expenses 2,091,207.90 4,160,293.14
Loss from disposal of fixed assets, intangible assets and other long-term
-125,530,905.04 -1,890,279.95
assets (gain is listed with “-”)
93
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Loss on scrapping of fixed assets (gain is listed with “-”) 661,923.94 2,175,378.87
Gain/loss of fair value changes (gain is listed with “-”) 18,069,553.29 74,432,928.14
Financial expenses (gain is listed with “-”) -11,447,977.73 36,972,909.58
Investment loss (gain is listed with “-”) -812,762,229.33 -929,472,701.41
Decrease of deferred income tax asset ((increase is listed with “-”) 1,793,420.95 6,279,057.80
Increase of deferred income tax liability (decrease is listed with “-”) 3,135,839.77 -12,925,247.95
Decrease of inventory (increase is listed with “-”) 372,883,000.74 1,265,262,274.11
Decrease of operating receivable accounts (increase is listed with “-”) 370,183,379.30 -3,855,816,972.58
Increase of operating payable accounts (decrease is listed with “-”) -108,140,333.37 -578,522,427.61
Other 7,169,302.54 36,918,218.19
Net cash flows arising from operating activities 1,089,961,237.42 -2,493,982,044.89
2. Material investment and financing not involved in cash flow
Conversion of debt into capital
Switching Company bonds due within one year
financing lease of fixed assets
3. Net change of cash and cash equivalents:
Balance of cash at period end 2,387,464,673.97 1,490,785,302.80
Less: Balance of cash equivalent at year-begin 2,277,117,604.82 1,094,018,936.73
Add: Balance at year-end of cash equivalents
Less: Balance at year-begin of cash equivalents
Net increase of cash and cash equivalents 110,347,069.15 396,766,366.07
(2) Net cash payment for the acquisition of a subsidiary in the period
Nil
(3) Net cash received from the disposal of subsidiaries
Nil
(4) Constitution of cash and cash equivalent
In RMB
Item Ending balance Opening balance
I. Cash 2,387,464,673.97 2,277,117,604.82
Including: Cash on hand 76,329.51 51,818.51
Bank deposit available for payment at any time 2,387,388,344.46 2,277,065,786.31
II. Balance of cash and cash equivalents at the period-end 2,387,464,673.97 2,277,117,604.82
Other explanation:
The difference between bank deposits available for payment at any time and the bank deposits in Note VII. 1 “Monetary Funds” is
the company's fixed deposits in the bank.
94
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
64. Note of the changes of owners’ equity
Explain the items and amount at period-end adjusted for “Other” at end of the last year: Nil
65. Assets with ownership or use right restricted
In RMB
Item Ending book value Restriction reason
Monetary funds 18,840,000.00 Forex Contracts USD Margin
Monetary funds 12,066,812.90 Margin paid for issuing bank acceptance bills
Monetary funds 7,935,750.00 IRD performance bond
Monetary funds 211,620.00 Cash deposit for Mastercard
Monetary funds 5,000.00 ETC freezing
Receivables financing 825,831,044.39 Notes pledge for bank acceptance
Note receivable 37,607,161.90 Notes pledge for bank acceptance
Total 902,497,389.19
66. Item of foreign currency
(1) Item of foreign currency
In RMB
Closing balance of foreign Ending RMB balance
Item Rate of conversion
currency converted
Monetary funds
Including: USD 20,252,686.24 7.22580 146,341,845.38
EUR 31,025,258.27 7.8771 244,389,392.00
HKD 966.00 0.92198 890.63
JPY 7,975,654.00 0.050094 399,532.41
DKK 134,704,837.49 1.0581 142,531,188.55
Account receivable
Including: USD 3,492,232.71 7.22580 25,234,175.12
EUR 32,573,879.77 7.8771 256,587,708.34
HKD
JPY 12,920,875.00 0.050094 647,258.31
DKK 12,157,993.84 1.0581 12,864,373.28
Long-term borrowings
Including: USD
EUR
HKD
Other accounts receivable
Including: USD 100.00 7.22580 722.58
EUR 248,803.02 7.8771 1,959,846.27
DKK 1,715,115.29 1.0581 1,814,763.49
Short-term borrowings
Including: USD
EUR
Account payable
Including: USD 709,559.53 7.22580 5,127,135.25
95
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
EUR 29,753,425.46 7.8771 234,370,707.71
JPY 24,899,918.00 0.050094 1,247,336.49
CHF 261,904.94 8.0614 2,111,320.48
DKK 12,769,122.98 1.0581 13,511,009.03
GBP
Other account payable
Including: USD 1,087.90 7.22580 7,860.95
EUR 3,707.88 7.8771 29,207.38
DKK 149,968.60 1.0581 158,681.78
Non-current liabilities due
within one year
Including: USD 156,513.08 7.22580 1,130,932.21
EUR 490,296.74 7.8771 3,862,116.45
DKK 645,753.26 1.0581 683,271.52
Leasing liabilities
Including: USD 386,008.72 7.22580 2,789,221.81
EUR 1,042,742.31 7.8771 8,213,785.45
DKK 11,015,070.07 1.0581 11,655,045.64
(2) Explanation on foreign operational entities, for the major foreign operational entity, disclose main
operation place, book-keeping currency and basis for selection, reasons for changes of book-keeping
currency if any
Applicable □Not applicable
Subsidiary IRD was established in Denmark in 1996. The 66% equity of IRD were acquired by the Company in cash in April 2019.
In October 2020, the Company acquired the remaining 34.00% equity of IRD in cash, thus the Company holds 100% equity of IRD.
IRD is denominated in Danish krone, and IRD is mainly engaged in R&D, production and sales of fuel cell components.
Subsidiary Borit was established in Belgium in 2010. The Company acquired 100% equity of Borit in cash in November 2020. Borit
is denominated in Euro and engaged in R&D, production and sales of fuel cell components.
Subsidiary VHIO was established in Italy in 2000. The Company acquired 100.00% equity of VHIT in cash in October 2022. The
Company is denominated in Euro and engaged in R&D, production, and sales of vacuum and hydraulic pumps.
67. Government grants
(1) Government grants
In RMB
Amount reckoned in current
Category Amount Item
gain/loss
VHIO tax credit 4,565,105.73 Other income 4,565,105.73
Job stabilization and expanding subsidy 135,524.51 Other income 135,524.51
Training subsidy 95,550.00 Other income 95,550.00
3R 642,615.43 Other income 642,615.43
Loter.CO2M 1,187,678.39 Other income 1,187,678.39
Neptune 145,399.97 Other income 145,399.97
AdvancePEM 1,844,744.94 Other income 1,844,744.94
Pemtastic 2,994,265.06 Other income 2,994,265.06
BORIT intellectual property tax exemption 416,434.43 Other income 416,434.43
96
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
CAMEDO 324,791.90 Other income 324,791.90
Subsidy for specialized, new and small giant
200,000.00 Other income 200,000.00
enterprises
Talent policy subsidies 557,028.00 Other income 557,028.00
Third generation handling fee 822,184.78 Other income 822,184.78
Deferred
The second batch of technical transformation in 2023; 2,000,000.00
income
Other 916,750.00 Other income 916,750.00
Total 16,848,073.14
(2) Government grants rebate
□Applicable Not applicable
68. Others
Nil
VIII. Changes of consolidation scope
1. Enterprise combinations not under the same control
(1) Enterprise combination not under the same control that occurred in the current period
Nil
(2) Consolidation cost and goodwill
Nil
(3) Identifiable assets and liabilities of the merged party on the merger date
(4) Gains or losses arising from re-measured by fair value for the equity held before purchasing date
Whether it is a business combination realized by two or more transactions of exchange and a transaction of obtained control rights
in the Period or not
□Yes No
(5) Explanation on the merger consideration or the fair value of the merged party’s identifiable assets
and liabilities which cannot be reasonable determined on the merge date or the end of the period
Nil
(6) Other explanation
Nil
97
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
2. Enterprise combination under the same control
(1) Enterprise combinations under the same control that occurred in the current period
Nil
(2) Merge cost
Nil
(3) Book value of assets and liabilities of the merged party on the merger date
Nil
3. Reverse purchase
Basic information of transaction, basis for reverse purchase of transaction, whether the assets and liabilities retained by the listed
company constitute a business and its basis, determination of merger costs, amount and calculation of adjusting equity when
dealing with equity transactions: Nil
4. Disposal of subsidiaries
Whether there is a single disposal of an investment in a subsidiary that resulted in a loss of control
□Yes No
Whether there is a step-by-step disposal of investment in a subsidiary through multiple transactions and loss of control during the
period
□Yes No
5. Changes in the scope of consolidation due to other reasons
Explanation on changes in the scope of consolidation due to other reasons (e.g. new establishment of a subsidiary, subsidiary
liquidation, etc.) and related information: Nil
6. Others
Nil
IX. Equity in other entities
1. Equity in subsidiaries
(1) Constitute of enterprise group
Main operation Register Share-holding ratio
Subsidiary Business nature Acquired way
place ed place Directly Indirectly
Spare parts of internal- Enterprise combination
WFJN Nanjing Nanjing 80.00%
combustion engine under the same control
Automobile exhaust Enterprise combination
WFLD Wuxi Wuxi 94.81%
purifier, muffler under the same control
Spare parts of internal-
WFMA Wuxi Wuxi 100.00% Investment
combustion engine
Spare parts of internal-
WFCA Wuxi Wuxi 100.00% Investment
combustion engine
98
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Enterprise combination
WFTR Wuxi Wuxi Trade 100.00%
under the same control
Spare parts of internal-
WFSC Wuxi Wuxi 66.00% Investment
combustion engine
Spare parts of internal- Enterprise combination not
WFTT Ningbo Ningbo 98.83% 1.17%
combustion engine under the same control
Spare parts of internal- Enterprise combination not
WFAM Wuxi Wuxi 51.00%
combustion engine under the same control
WFLD Automobile exhaust
Wuhan Wuhan 60.00% Investment
(Wuhan) purifier, muffler
WFLD Chongqi Automobile exhaust
Chongqing 100.00% Investment
(Chongqing) ng purifier, muffler
WFLD Nancha Automobile exhaust
Nanchang 100.00% Investment
(Nanchang) ng purifier, muffler
WFAS Wuxi Wuxi Car seats products 66.00% Investment
Enterprise combination not
WFDT Wuxi Wuxi Hub motor 80.00%
under the same control
WFQL Wuxi Wuxi Fuel cell components 45.00% 30.00% Investment
Automobile Enterprise combination not
VHWX Wuxi Wuxi 100.00%
components under the same control
Denmar
SPV Denmark Investment 100.00% Investment
k
Denmar Enterprise combination not
IRD Denmark Fuel cell components 100.00%
k under the same control
Enterprise combination not
IRD America America America Fuel cell components 100.00%
under the same control
Enterprise combination not
Borit Belgium Belgium Fuel cell components 100.00%
under the same control
Enterprise combination not
Borit America America America Fuel cell components 100.00%
under the same control
Automobile Enterprise combination not
VHIO Italy Italy 100.00%
components under the same control
Explanation on share-holding ratio in subsidiary different from ratio of voting right
Nil
Basis for holding half or less of the voting rights but still controlling the investee, and holding more than half of the voting rights
but not controlling the investee
Nil
Basis for inclusion in the scope of consolidation of significant structured entities, control
Nil
Basis for determining whether a company is an agent or a principal
Nil
Other explanation
Nil
(2) Important non-wholly-owned subsidiary
In RMB
Gains/losses attributable Dividend announced to distribute Ending equity
Subsidiary Share-holding ratio of minority
to minority in the period for minority in the period of minority
WFJN 20.00% 28,182,096.53 239,063,843.11
WFSC 34.00% 1,707,747.13 28,306,333.61
WFLD 5.19% 495,669.34 153,206,542.03
WFAM 49.00% 7,567,993.25 224,123,772.73
99
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Total 37,953,506.25 644,700,491.48
Explanation on holding ratio different from the voting right ratio for minority shareholders
Nil
(3) Main finance information of the important non-wholly-owned subsidiary
In RMB
Ending balance
Subsidiary Non-current Current Non-current
Current assets Total assets Total liabilities
assets liabilities liabilities
WFJN 1,009,156,897.77 601,789,177.52 1,610,946,075.29 379,549,026.48 35,071,853.60 414,620,880.08
WFSC 188,303,633.86 51,357,714.40 239,661,348.26 156,013,188.66 156,013,188.66
WFLD 4,237,251,690.05 1,503,092,492.26 5,740,344,182.31 2,895,508,104.73 216,474,283.38 3,111,982,388.11
WFAM 402,467,434.49 548,655,242.74 951,122,677.23 428,082,203.22 67,275,692.56 495,357,895.78
Total 5,837,179,656.17 2,704,894,626.92 8,542,074,283.09 3,859,152,523.09 318,821,829.54 4,177,974,352.63
In RMB
Opening balance
Subsidiary Non-current Current Non-current
Current assets Total assets Total liabilities
assets liabilities liabilities
WFJN 858,419,058.16 577,359,266.26 1,435,778,324.42 346,383,138.63 35,181,853.60 381,564,992.23
WFSC 204,138,588.74 48,627,033.79 252,765,622.53 174,162,086.64 174,162,086.64
WFLD 4,869,373,661.60 1,412,237,671.12 6,281,611,332.72 3,512,116,686.68 218,075,518.79 3,730,192,205.47
WFAM 434,472,654.85 554,774,642.02 989,247,296.87 449,094,531.03 99,748,081.81 548,842,612.84
Total 6,366,403,963.35 2,592,998,613.19 8,959,402,576.54 4,481,756,442.98 353,005,454.20 4,834,761,897.18
In RMB
Amount in reporting period
Subsidiary Total comprehensive Cash flow from
Operation Income Net profit
income operation activity
WFJN 362,347,975.32 140,705,646.86 140,705,646.86 -860,079.84
WFSC 212,765,150.03 5,022,719.78 5,022,719.78 12,852,744.75
WFLD 2,175,323,269.69 71,083,391.94 71,083,391.94 455,043,631.50
WFAM 323,869,868.52 15,360,097.42 15,360,097.42 77,957,350.25
Total 3,074,306,263.56 232,171,856.00 232,171,856.00 544,993,646.66
In RMB
Amount in last period
Subsidiary Total comprehensive Cash flow from operation
Operation Income Net profit
income activity
WFJN 447,804,363.41 65,145,897.60 65,145,897.60 -51,110,746.71
WFSC 226,170,484.98 10,460,851.26 10,460,851.26 -33,350,047.74
WFLD 3,287,233,284.58 138,297,551.67 138,297,551.67 397,683,438.88
WFAM 330,358,273.12 32,245,277.07 32,245,277.07 92,627,392.88
Total 4,291,566,406.09 246,149,577.60 246,149,577.60 405,850,037.31
(4) Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise group
Nil
100
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(5) Financial or other support offered to the structured entities included in the scope of consolidated
financial statements
Nil
2. Transaction that has owners’ equity shares changed in subsidiary but still with controlling rights
(1) Owners’ equity shares changed in subsidiary
Nil
(2) Impact on minority’s interests and owners’ equity attributable to parent company
Nil
3. Equity in joint venture and associated enterprise
(1) Important joint venture and associated enterprise
Share-holding ratio Accounting
treatment on
Main
Joint venture or associated Registered investment for
operation Business nature Indirectl
enterprise place Directly joint venture and
place y
associated
enterprise
WFEC Wuxi Wuxi Catalyst 49.00% Equity method
Internal-
RBCD Wuxi Wuxi combustion 32.50% 1.50% Equity method
engine accessories
Internal-
Zhonglian Automobile
Shanghai Shanghai combustion 20.00% Equity method
Electronics Co., Ltd.
engine accessories
Internal-
Wuxi Weifu Precision Machinery
Wuxi Wuxi combustion 20.00% Equity method
Manufacturing Co., Ltd.
engine accessories
Changchun Xuyang Weifu
Changchu Automobile
Automobile Components Changchun 34.00% Equity method
n components
Technology Co., Ltd.
Fuel cell
Precors GmbH Germany Germany 43.39% Equity method
components
Wuxi ChelianTianxia Information Telematics 9.6372
Wuxi Wuxi Equity method
Technology Co., Ltd. services %
Lezhuo Bowei Hydraulic Automobile
Shanghai Shanghai 50.00% Equity method
Technology (Shanghai) Co., Ltd components
Holding shares ratio different from the voting right ratio: Nil
Basis for holding less than 20% of voting rights but with significant impact, or holding 20% or more of voting rights but without
significant impact:
The Company holds 9.6372% equity of Chelian Tianxia, and appointed a director to Chelian Tianxia. Though such representative,
the Company can participate in the operation policies formulation of Chelian Tianxia, and thus exercise a significant influence over
Chelian Tianxi.
101
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Main financial information of the important joint venture
Nil
(3) Main financial information of the important associated enterprise
In RMB
Ending balance/Amount in reporting period Opening balance/Amount in last period
Zhonglian Zhonglian
WFEC RBCD WFEC RBCD
Electronics Electronics
Current assets 3,197,806,721.94 16,755,294,611.32 1,558,880,363.29 3,507,976,754.16 15,426,523,373.99 241,595,079.15
Non -current assets 322,109,820.91 3,352,676,291.64 7,132,120,000.92 333,764,427.43 3,421,035,986.82 7,557,124,612.32
Total assets 3,519,916,542.85 20,107,970,902.96 8,691,000,364.21 3,841,741,181.59 18,847,559,360.81 7,798,719,691.47
Current liabilities 1,199,741,188.01 13,574,648,492.61 1,411,754,246.77 1,665,411,123.81 8,810,309,639.09 6,171,780.23
Non-current
469,668,631.03 2,487,436.06 493,618,200.85 2,517,670.77
liabilities
Total liabilities 1,669,409,819.04 13,574,648,492.61 1,414,241,682.83 2,159,029,324.66 8,810,309,639.09 8,689,451.00
Including: cash and
1,067,629,913.47 8,733,327.18 128,530,289.29 813,874,175.27 10,773,921.81 225,052,854.96
cash equivalent
Minority interests
Equity attributable to
shareholders of the 1,850,506,723.81 6,533,322,410.35 7,276,758,681.38 1,682,711,856.93 10,037,249,721.72 7,790,030,240.47
parent company
Share of net assets
calculated by 906,748,294.66 2,221,329,619.51 1,455,351,736.27 824,528,809.90 3,412,664,905.38 1,558,006,048.09
shareholding ratio
Adjustment matters
--Goodwill 267,788,761.35 1,407,265.96 267,788,761.35 1,407,265.96
--Unrealized profit of
-15,634,582.21 -20,692,355.48
internal trading
--Other -0.28 -0.28
Book value of equity
investment in 906,748,294.66 2,473,483,798.37 1,456,759,002.23 824,528,809.90 3,659,761,310.97 1,559,413,314.05
associated enterprise
Fair value of equity
investments in joint
ventures with
publicly quoted
prices
Operation income 1,767,599,633.82 6,130,896,971.82 12,971,075.74 2,448,287,999.54 8,322,989,203.32 9,460,906.82
Net profit 166,314,657.54 1,418,441,731.89 896,728,440.91 142,874,508.54 1,687,151,931.01 841,207,709.66
Net profit from
discontinued
operations
Other comprehensive
income
Total comprehensive
166,314,657.54 1,418,441,731.89 896,728,440.91 142,874,508.54 1,687,151,931.01 841,207,709.66
income
Dividends received
from associated 382,918,855.12
enterprise in the year
Other explanation:
Adjustment item: "Other: -0.28" indicates that it is caused by tail difference.
102
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(4) Financial summary for non-important joint venture and associated enterprise
In RMB
Ending balance/Amount in
Opening balance/Amount in last period
reporting period
Joint venture:
The total amount of the following items calculated
based on shareholding ratio
Associated enterprise:
Total book value of investment 351,004,139.17 239,114,674.05
The total amount of the following items calculated
based on shareholding ratio
--Net profit -1,393,571.96 639,624.55
--Total comprehensive income -1,393,571.96 639,624.55
(5) Major limitation on capital transfer ability to the Company from joint venture or associated
enterprise
Nil
(6) Excess loss occurred in joint venture or associated enterprise
Nil
(7) Unconfirmed commitment with joint venture investment concerned
Nil
(8) Intangible liability with joint venture or associated enterprise investment concerned
Nil
4. Major joint operation
Nil
5. Equity in structured entities not included in the scope of consolidated financial statements
Relevant explanations on structured entities not included in the scope of the consolidated financial statements: Nil
6. Other
Nil
X. Risk related with financial instruments
Main financial instruments of the Company include monetary funds, structured deposits, account receivable, equity instrument
103
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
investment, financial products, loans, and account payable. For more details of the financial instruments, refer to relevant items of
Note VII. Risks concerned with the above-mentioned financial instruments, and measures taken by the company to prevent such risks
are as follow:
The risk management by the company is targeted to balance risk and benefit, minimize the adverse impact on performance of the
Company and maximize the benefits of shareholders and other investors. On such basis, the basic tactics of the risk management is to
recognize and analyze risks faced by the company, establish appropriate risk exposure baseline for risk management, and supervise
risks timely and reliably in order to control risks in a limited range.
During the operation process, risks faced by the company related to financial instruments mainly include credit risk, market risk, and
liquidity risk. BOD of the Company takes full charge of defining risk management target and polices, and takes ultimate
responsibilities for the target of risk management and policies. The compliance department and financial control department manage
and supervise risk exposures to control risks in a limited range.
1. Credit Risk
Credit risk arises in case one party of a financial instrument fails to perform its obligations, resulting in the financial loss of other
party. The company’s credit risk mainly comes from monetary funds, structured deposits, note receivable, account receivable and
other accounts receivable. The management has established appropriate credit policies and kept monitoring the exposure to these
credit risks.
The monetary funds and structured deposits held by the Company are mainly deposited in financial institutions such as commercial
banks. The management believes that these commercial banks have higher credit and asset status and lower credit risks. The
Company adopts quota policies to avoid credit risks from any financial institutions.
For accounts receivable, other receivables and bills receivable, the Company sets relevant policies to control the credit risk exposure.
To prevent risks, the company has formulated a new customer credit evaluation system and an existing customer credit sales balance
analysis system. For new customers, the company performs background investigation according to the established process to
determine whether to offer such customer a credit line, the scale of credit line as well as credit period. Accordingly, the company has
set a credit limit and a credit period for each customer, which is the maximum amount that does not require additional approval. For
the analysis system for credit sales balance of existing customers, after receiving a purchase order from an existing customer, the
company will check the order amount and the balance of the accounts owed by such customer. If the total of the two exceeds the
credit limit of the customer, the company can only sell to the customer on the premise of additional approval of credit line and
otherwise the customer will be required to pay the corresponding amount in advance. In addition, for the credit sales that have
occurred, the company analyzes and audits the monthly statements for risk warning of accounts receivable to ensure that the
company’s overall credit risk is within a controllable range.
The maximum credit risk exposure of the Company is the carrying amount of each financial asset on the balance sheet.
2. Market risk
Market risk of the financial instrument refers to the fair value of financial instrument or future cash flow fluctuates with the changing
market price, mainly including interest rate risk, foreign exchange risk and other price risk.
(1) Interest rate risk
Interest rate risk indicates that the company’s financial status and cash flow fluctuate with the changing market interest rate. The
interest rate risk of the Company is mainly related with the bank loans. In order to lower the impact of risks of fluctuating interest
rate, the Company, in consideration of the expected change orientation of interest rate, chooses floating rate or fixed rate. The
company will choose fixed interest rate if the interest rate is expected to go up in the future period, and alternatively choose floating
interest rate if the interest rate is expected to go up in the future period. In order to minimize the adverse impact if the change trend of
interest rate is out of expectation, the company selects short-term borrowings to satisfy its demands for liquidity and there are special
104
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
provisions for early repayment.
(2) Foreign exchange risk
Foreign exchange risk refers to the losses arising from fluctuation of exchange rate. The foreign exchange risk posed to the Company
is mainly related to USD, EUR, CHF, JPY, HKD and DKK. The procurement of equipment by the parent company and WFAM, the
material purchasing of the parent company, the payment of technical service expense and trademark royalty of the parent company,
the import and export of WFTR, as well as the operation of IRD, Borit, and VHIO are settled in USD, EUR, CHF, JPY, HKD and
DKK. Other main businesses of the Company are priced and settled in RMB (yuan). As the foreign financial assets and liabilities
takes minor ratio in total assets, the company’s management believes that the foreign exchange rate of is lower.
As of June 30, 2023, except for the following assets or liabilities listed with foreign currency, assets and liabilities of the Company
are carried with RMB.
① Details of foreign currency assets of the Company as of June 30, 2022
Item Ending balance in Conversion Ending balance converted to
Ratio in assets (%)
foreign currency exchange rate RMB yuan
Monetary funds
Including: USD 20,252,686.24 7.22580 146,341,845.38 0.52
EUR 31,025,258.27 7.8771 244,389,392.00 0.86
HKD 966.00 0.92198 890.63 -
JPY 7,975,654.00 0.050094 399,532.41 -
DKK 134,704,837.49 1.0581 142,531,188.55 0.50
Account receivable
Including: USD 3,492,232.71 7.22580 25,234,175.12 0.09
EUR 32,573,879.77 7.8771 256,587,708.34 0.90
JPY 12,920,875.00 0.050094 647,258.31 -
DKK 12,157,993.84 1.0581 12,864,373.28 0.05
Other accounts receivable
Including: USD 100.00 7.22580 722.58 -
EUR 248,803.02 7.8771 1,959,846.27 0.01
DKK 1,715,115.29 1.0581 1,814,763.49 0.01
Total ratio in assets 2.94
②Foreign currency liability of the Company as of the June 30, 2023
Ending balance in Conversion Ending balance converted to Ratio in liabilities
Item
foreign currency exchange rate RMB yuan (%)
Account payable
Including: USD 709,559.53 7.22580 5,127,135.25 0.06
EUR 29,753,425.46 7.8771 234,370,707.71 2.59
JPY 24,899,918.00 0.050094 1,247,336.49 0.01
CHF 261,904.94 8.0614 2,111,320.48 0.02
DKK 12,769,122.98 1.0581 13,511,009.03 0.15
Other account payable
Including: USD 1,087.90 7.22580 7,860.95
EUR 3,707.88 7.8771 29,207.38
DKK 149,968.60 1.0581 158,681.78
Non-current liabilities
maturing within one year
Including: USD 156,513.08 7.22580 1,130,932.21 0.01
EUR 490,296.74 7.8771 3,862,116.45 0.04
DKK 645,753.26 1.0581 683,271.52 0.01
Leasing liabilities
105
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Ending balance in Conversion Ending balance converted to Ratio in liabilities
Item
foreign currency exchange rate RMB yuan (%)
Including USD 386,008.72 7.22580 2,789,221.81 0.03
EUR 1,042,742.31 7.8771 8,213,785.45 0.09
DKK 11,015,070.07 1.0581 11,655,045.64 0.13
Total ratio in liabilities 3.14
③ Other price risk
The equity instrument investments held by the Company with classification as transaction financial asset and other non-current
financial assets are measured at fair value on the balance sheet date. The expected price fluctuation of such these investments will
affect the gains/losses of fair value changes of the Company.
Furthermore, deliberated and approved in 10th meeting of 8th session of the BOD, the Company exercise entrust financing with its
own idle capital; therefore, the Company is subject to the risk of failing to collect the principal of entrust financial products due to
default. Aimed at such risk, the Company formulated the “Management Mechanism of Capital Financing”, and well-defined the
authority approval, investment decision-making, calculation management and risk controls for the entrust financing in order to ensure
fund security and prevent investment risk efficiently. In order to lower the adverse impact from unpredictable factors, the Company
allocates investments with short term and medium term and the term of investment is up to five years in principle; The company
selects investment products such as bank wealth management products, trust plans of trust company, the asset management plans of
asset management company, as well as products issued by securities companies, fund companies, and insurance companies.
3. Liquidity risk
Liquidity risk refers to the capital shortage risk occurs when enterprise implements obligations settled by delivering cash or other
financial assets. The company’s goal is to guarantee rich capital to pay the due debts. Therefore, it establishes the financial control
department for centralized risk control. The financial control department keeps monitoring the cash balance, the marketable securities
ready to be converted into cash at any time and the rolling forecast on cash flow in future 12 months, ensuring the Company, on
condition of reasonable prediction, owes rich capital to pay debts; Besides, the financial control department builds favorable
relationship with banks, rationally design the line of credit, credit products and credit terms, guarantee a sufficient line of credit from
banks in order to satisfy short-term financing requirements of the company.
XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
In RMB
Ending fair value
Item
First level Second level Third level Total
I. Sustaining measured by fair value -- -- -- --
(I)Trading financial assets 150,563,059.41 2,469,635,404.87 2,620,198,464.28
1. Financial assets measured at fair value and
whose changes are included in current profit 150,563,059.41 2,469,635,404.87 2,620,198,464.28
or loss
(1) Liability instrument investment 2,469,635,404.87 2,469,635,404.87
(2) Equity instrument investment 150,563,059.41 150,563,059.41
(II) Other equity instrument investment 677,790,690.00 677,790,690.00
(III) Receivable financing 1,920,348,206.04 1,920,348,206.04
(IV) Other non-current financial assets- 161,342,387.00 161,342,387.00
106
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
equity instrument investment
(V) Other non-current financial assets-other
liability instrument and equity instrument 635,000,000.00 635,000,000.00
investment
Total assets sustaining measured by fair value 150,563,059.41 161,342,387.00 5,702,774,300.91 6,014,679,747.32
(I) Financial liabilities measured at fair value
737,424.50 737,424.50
through profit or loss
Derivative financial liabilities - foreign 737,424.50 737,424.50
exchange contracts
Total liabilities sustaining measured at fair 737,424.50 737,424.50
value
II. Non-persistent measured by fair value -- -- -- --
2. Basis for recognizing the market price of items sustaining and non-persistent measured by fair value
on first level
On June 30, 2023, the financial assets available for sale, equity instrument investments held by the Company include SNAT (stock
code: 600841), Miracle Automation (Stock code: 002009), ifan Technology (Stock Code: 601777) and Zoyte Auto(000980). The
fair value at the end of the period is determined at the closing price as of June 30, 2022.
3. The qualitative and quantitative information for the valuation technique and critical parameter of
items sustaining and non-persistent measured by fair value on second level
On June 30, 2023, other non-current financial assets, equity instrument investments held by the Company include Guolian
Securities (stock code: 601456). The fair value at the end of the period is determined at the closing price and liquidity discount as
of June 30, 2023.
The derivative financial liabilities that continue to be measured at the second level of fair value are forward foreign exchange
settlement and sales contracts, and they are measured at the fair value of the forward foreign exchange settlement and sales contracts
provided by the contracting bank.
4. The qualitative and quantitative information for the valuation technique and critical parameter of
items sustaining and non-persistent measured by fair value on third level
(1) Accounts receivable financing
The Company uses discounted cash flow valuation techniques to determine the fair value of this part of financial assets. The
important unobservable input values mainly include discount rate and contractual cash flow maturity period. The cash flow with a
contract expiration period of 12 months (inclusive) shall not be discounted, and the cost shall be regarded as its fair value.
(2) Other equity instrument investment
As such financial assets are poorly circulated in market, the Company adopts replacement cost method to determine their fair value.
The important unobservable input values mainly include the financial data of the invested company.
(3) Other liability instrument and equity instrument investment
The company applies discounted cash flow valuation technology to determine such financial assets. The important unobtainable input
values mainly include expected annual return rate and risk coefficient.
5. For items sustaining measured by fair value on second level, adjustment information between the
opening and closing book value and sensitivity analysis of unobservable parameters
Nil
107
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
6. For items sustaining measured by fair value, describe the reasons for the conversion and the policy for
determining the timing of the conversion if there is a conversion between levels in the current period
Nil
7. Changes in valuation technology during the current period and reasons for such changes
Nil
8. The fair value of financial assets and financial liabilities not measured by fair value
Nil
9. Other
Nil
XII. Related party and related party transactions
1. Parent company of the company
Share-holding ratio
Voting right ratio on
Parent company Registration place Business nature Registered capital on the enterprise for
the enterprise
parent company
Operation of state-
Wuxi Industry Group Wuxi 5,496,785,600 20.35% 20.35%
owned assets
Explanation on the parent company of the company
Wuxi Industry Group is an enterprise controlled by the State-owned Assets Management Committee of Wuxi Municipal People’s
Government. Its business scope includes foreign investment by using its own assets, house leasing services, self-operating and acting
as an agent for the import and export business of various commodities and technologies (Except for goods and technologies that are
restricted by the state or prohibited for import and export), domestic trade (excluding national restricted and prohibited items).
(Projects that are subject to approval in accordance with the law can be operated only after being approved by relevant departments).
The ultimate controller of the Company is the State-owned Assets Supervision & Administration Commission of Wuxi
Municipality of Jiangsu Province.
Other explanation:
Nil
2. Subsidiary of the Company
For more details of the Company’s subsidiaries, please refer to IX. 1. “Equity in subsidiary”
3. Joint venture and associated enterprise
For more details, please refer to Note IX.3. “Equity in joint arrangement and associated enterprise”
108
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
4. Other related party
Other related party Relationship with the Company
Robert Bosch Company The second largest shareholder of the Company
Wuxi Guokai Metal Resources Co., Ltd.(hereinafter referred to as “Guokai
Enterprises controlled by the parent company
Metals”)
Wuxi Sunan Urban Public Delivery Co., Ltd. (hereinafter referred to as
Enterprises controlled by the parent company
“Urban Public Delivery”)
Company A (temporarily referred to as Company A due to confidentiality
Enterprises controlled by related parties of the
requirements of the case as it is still in the stage of investigation by the public
company’s directors/senior management
security organs)
Director, supervisor and senior executive of the
Key executive
Company
5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
Whether more than
Content of related Amount in current Approved
Related party the transaction limit Last Period
transaction period transaction limit
(Y/N)
WFPM Goods and labor 19,815,457.88 56,000,000.00 N 16,947,881.11
RBCD Goods and labor 131,039,396.29 380,000,000.00 N 174,508,017.89
WFEC Goods 379,816,654.91 601,000,000.00 N 246,646,895.23
Robert Bosch
Goods and labor 111,692,343.27 300,000,000.00 N 93,906,096.78
Company
Changchun
Goods 0.00 1,500,000.00 N 342,520.00
Xuyang
Guolai Metals Goods 15,867,033.58 0.00 Y
Lezhuo Bowei Goods 0.00 1,000,000.00 N
Goods sold/labor service providing
In RMB
Related party Content of related transaction Amount in current period Amount in last period
WFPM Goods and labor 506,017.52 522,692.40
RBCD Goods and labor 1,090,789,696.99 1,633,269,280.49
WFEC Goods and labor 4,677,697.81 158,613.70
Robert Bosch Company Goods and labor 846,273,667.53 724,668,201.55
Changchun Xuyang Goods and labor 678,183.20 181,484.70
Lezhuo Bowei Goods and labor 222,373.51
Explanation on related transactions in the purchase and sale of goods, provision and acceptance of labor services: Nil
(2) Related trusteeship management/contract & entrust management/ outsourcing
Nil
109
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(3) Related lease
The Company is a lessor:
In RMB
Lease income recognized in Lease income recognized at
Lessee Assets type
the reporting period last period
WFEC Workshop 1,003,317.02 1,190,379.04
Explanation on related lease
WFLD entered into a house leasing contract with WFEC. WFLD rented its plant located at No.9 Linjiang Road, Xinwu District,
Wuxi to WFEC. It is agreed that the rent income in the period from January 1, 2023 to June 30, 2023 is 1,003,317.02 yuan.
(4) Related guarantee
Nil
(5) Borrowing and lending of related party
Nil
(6) Assets transfer and debt reorganization of related party
Nil
(7) Remuneration of key manager
In RMB
Item Amount in current period Amount in current period
Remuneration of key executives 2,300,000.00 4,400,000.00
(8) Other related transactions
Related party Contents of item Amount in current period Amount in last period
WFPM Purchase fixed assets 106,000.00 --
RBCD Pay technical loyalty, etc. -- 312,038.48
RBCD Purchase fixed assets -- 1,314,941.34
Robert Bosch Company Pay technical loyalty, etc. -- 130,459.36
Robert Bosch Company Purchase fixed assets 1,052,964.60 54,716.98
Robert Bosch Company Rent receivable 110,200.00 --
Robert Bosch Company Utilities receivable 393,590.45 --
Robert Bosch Company Provide technology service,etc 1,990,910.38 --
WFEC Utilities payable 528,099.08 614,493.68
Lezhuo Bowei Rent receivable 1,057,234.32 --
Lezhuo Bowei Utilities receivable 304,658.93 --
Urban Public Delivery Procurement of food ingredients 709,227.44 --
110
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
6. Receivable/payable items of related parties
(1) Receivable item
In RMB
Ending balance Opening balance
Item Related party Provision for bad Provision for bad
Book balance Book balance
debts debts
Account receivable WFPM 185,059.90 299,389.13 10,925.29
Account receivable RBCD 511,897,553.12 619,942.02 461,493,652.46 174,766.71
Robert Bosch
Account receivable 423,176,007.79 754,342.26 363,021,724.83 882,016.11
Company
Other accounts receivable WFEC 147,000,000.00
Other accounts receivable RBCD 1,673,605,474.71
Zhonglian
Other accounts receivable 282,000,000.00
Electronics
Robert Bosch
Other non-current assets 1,470,000.00
Company
Wuxi Industry
Other non-current assets 5,452,800.00
Group
Other non-current assets RBCD 0.01
Account receivable WFEC 2,302,063.68 514,638.29
Changchun
Account receivable 771,811.93 546.49 5,464.91
Xuyang
Lezhuo
Account receivable 67,447.62
Bowei
Robert Bosch
Accounts paid in advance 5,249,715.46
Company
(2) Payable item
In RMB
Item Related party Ending book balance Opening book balance
Account payable WFPM 12,262,621.48 17,783,464.23
Other account payable WFPM 29,000.00
Account payable WFEC 308,141,233.56 274,115,921.53
Account payable RBCD 41,762,235.95 37,603,958.72
Account payable Robert Bosch Company 24,349,831.15 49,500,046.68
Account payable Guokai Metals 3.12
Other current liabilities RBCD 0.05 0.05
Other current liabilities Robert Bosch Company 18,094.83 63,572.08
Other current liabilities WFEC 76,030.18
Other account payable Robert Bosch Company 14,105,360.83 13,308,176.65
Contract liability RBCD 0.36 0.36
Contract liability Robert Bosch Company 139,191.01 510,212.12
Contract liability WFEC 584,847.43
(3) Related creditor's rights of “platform trade”
In RMB
Item Related party Ending balance Opening balance
111
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Other receivables Company A 2,358,398,084.78 2,415,151,888.80
Note: Based on the principle of caution, the Company combines the balance of 4 companies that may be controlled by Company A
into the following list. The balance is the difference between the "purchase fund" paid by WFTR based on the "platform trade"
business and the "sales fund" received by WFTR. In accordance with the principle of substance over form, the company does not
treat the "platform trade" business of WFTR as normal trade business but as fund collection and payment business for accounting
treatment, so it is listed as other receivables.
7. Undertakings of related party
Nil
8. Other
Nil
XIII. Share-based payment
1. Overall situation of share-based payment
Applicable □Not applicable
In RMB
Total amount of equity instruments granted by the Company in reporting period 0.00
Total amount of equity instruments exercised by the Company in reporting period 0.00
Total amount of equity instruments invalidated by the company in reporting period 0.00
The grant price is 15.48 yuan per share; the
exercise time is from the first trading day
24 months after the completion of the
registration of the restricted stocks granted
The scope of the exercise price of the stock options issued by the company at the in the first tranche to the last trading day
end of the period and the remaining period of the contract within 60 months from the date of
completion of the registration of the
restricted stock granted in the first tranche,
so the remaining period of the contract is
two years and five months.
The scope of the exercise price of other equity instruments issued by the company
Nil
at the end of the period and the remaining period of the contract
2. Equity-settled share-based payment
Applicable □Not applicable
In RMB
Determine the fair value based on the
Method for determining the fair value of equity instruments on the grant date closing price of the restricted stock on the
grant date
Basis for determining the number of vesting equity instruments Unlocking conditions
Reasons for the significant difference between estimate in the current period and
Not Applicable
estimate in last period
Cumulative amount of equity-settled share-based payments included in the capital
117,512,991.57
reserve
Total amount of expenses confirmed by equity-settled share-based payments in the
5,522,079.65
current period
112
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
This restricted stock incentive plan was deliberated and approved by the company’s second extraordinary general meeting of
shareholders in 2020, which is summarized as follows:
(1) Stock source: the company’s A-share common stock repurchased from the secondary market.
(2) Grant date: November 12, 2020.
(3) Grant objects and number of grants: 19,540,000 restricted stocks were granted to 601 incentive recipients of the company and its
subsidiaries.
(4) Grant price: 15.48 yuan/share.
(5) Grant registration completion date: December 4, 2020.
(6) Release the restrictions on sales:
Ratio of unlocked
Unlock period Unlock time quantity to granted
quantity
Starting from the first trading day 24 months after the completion of the
Phase I unlocked 4/10
registration of the first grant and ending on the last trading day within 36 months
Phase II Starting from the first trading day 36 months after the completion of the
3/10
unlocked registration of the first grant and ending on the last trading day within 48 months
Phase III Starting from the first trading day 48 months after the completion of the
3/10
unlocked registration of the first grant and ending on the last trading day within 60 months
(7) Performance appraisal requirements at the company level:
Unlock conditions Performance appraisal requirements
1.The weighted average ROE for year of 2021 is not less than 10%;
2. The growth rate of self-operating profit in 2021 will not be less than 6% compared with the year of 2019,
The first batch of
the absolute amount will not be less than 845 million yuan;
unlock conditions
3. The cash dividends for year of 2021 shall be no less than 50% of the profit available for distribution of
the year.
1. The weighted average ROE for year of 2022 is not less than 10%;
The second batch 2. The growth rate of self-operating profit in 2022 will not be less than 12% compared with the year of
of unlocking 2019, the absolute amount will not be less than 892 million yuan;
conditions 3. The cash dividends for year of 2022 shall be no less than 50% of the profit available for distribution of
the current year.
1. The weighted average ROE for year of 2023 is not less than 10%;
The third batch of 2. The growth rate of self-operating profit in 2023 will not be less than 20% compared with the year of
unlocking 2019, the absolute amount will not be less than 958 million yuan;
conditions 3. the cash dividends for year of 2023 shall be no less than 50% of the profit available for distribution of the
current year.
The self-operating profit refers to the net profit attributable to the owners of the parent company after deducting extraordinary gains
and losses, and deducting the investment income from RBCD and Zhonglian Electronics.
3. Cash-settled share-based payment
□ Applicable Not applicable
4. Modification and termination of share-based payment
Nil
5. Other
Nil
113
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
XIV. Undertakings or contingency
1. Important undertakings
Important undertakings on balance sheet date
Nil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company, explained reasons
The Company has no important contingency that need to disclosed
3. Other
Nil
XV. Events after balance sheet date
1. Important non-adjustment matters
Nil
2. Profit distribution
Nil
3. Return of sales
Nil
4. Other events after balance sheet date
Nil
XVI. Other important events
1. Previous accounting errors correction
Nil
2. Debt restructuring
Nil
3. Assets replacement
Nil
114
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
4. Pension plan
The Enterprise Annuity Plan under the name of WFHT has deliberated and approved by 8th meeting of 7th session of the BOD: in
order to mobilize the initiative and creativity of employees, established a long-term talent incentive mechanism, and enhance the
cohesive force and competitiveness, the Company carried out the above mentioned annuity plan since the day when the company
receives the recording reply from labor security administration department. The annuity plan is as follows: the annuity fund are paid
by the company and employees together; the company’s contribution shall not exceed 8% of the gross salary of the employees of the
company per year, the combined contribution of the enterprise and the individual employee shall not exceed 12% of the total salary
of the employees of the company. The annuity fund will be adjusted in accordance with the State’s annuity policies, the company’s
economic benefits and is adaptable to the economic strength of the company. The company’s contribution at current period shall be
not higher than 8% of the total salary of last period, the maximum annual allocation to employees shall not exceed five times the
average allocation to employees and the excess amount will not be available for allocation. The individual contribution is limited to 1%
of the total salary for the previous year. Specific contribution ratio shall be adjusted correspondingly in line with the operation
condition of the Company.
In December 2012, the Company received the Reply on annuity plans recording under the name of WFHT from labor security
administration department, and then the Company entered into the Entrusted Management Contract of the Annuity Plan of WFHT
with PICC.
5. Termination of operation
Not applicable
6. Segment
(1) Recognition basis and accounting policy for reportable segment
The company determines the operating segments in line with the internal organization structure, management requirement and
internal reporting system. Operating segment of the Company refers to the followed components that have been satisfied at the same
time:
① The component is able to generate revenues and expenses in routine activities;
② Management of the Company is able to assess the operation results regularly, and determine resources allocation and performance
evaluation for the component;
③ The company can analyze and acquire the financial status, operation results and cash flow of the components of the component.
The Company is mainly engaged in the manufacture of fuel system of internal combustion engine and fuel cell components, auto
components, muffler and purifier. Based on product segments, the Company determines four reportable segments, automotive fuel
injection system and core parts of hydrogen fuel cell, automotive post-process system, air intake system, as well as muffler and
purifier. As mentioned in item 7 of Note XVI. WFTR launched “platform trade” business in 2022. During the process of carrying out
the “platform trade” business, WFTR was criminally investigated for contract fraud. The company’s management analyzed that it
was highly possible that this business was normal. To accurately present the company’s normal business situation, the “platform
trade” business is listed as a separate segment. The accounting policies for each reporting segment are consistent with those stated in
Note V.
Segment assets exclude transaction financial asset, other accounts receivable-dividends receivable, other non-current financial assets,
other equity instrument investment, long-term equity investment and other undistributed assets, since these assets are not related to
products operation.
(2) Financial information for reportable segment
In RMB
115
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Add: Undistributed
assets and gains/losses
such as investments or
Automotive fuel Automotive gains accounted for by
Other
injection system post- Automotive “platform the equity method,
automotive
and core parts processing air intake trade” liability instrument Inter-segment
Item air intake Total
of hydrogen system system business and equity instrument offset
system
fuel cell product segment segment investments, or their
segment
segment segment holding and disposal
gains/losses from
holding and disposal
of such investments
Operation 2,212,439,005. 287,746,815 610,489,114 120,797,725.8
3,139,771,837.92 6,129,649,047.40
income 16 .37 .75 0
Operation 2,018,142,665. 210,998,525 534,299,678
2,492,982,099.69 92,551,236.98 5,163,871,731.26
cost 23 .09 .23
-
25,891,569.
Total profit 241,151,742.15 -32,902,142.04 33,592,952. 793,337,080.20 -17,761,795.07 1,011,647,091.89
09
58
24,210,488. 15,987,031.
Net profits 171,732,485.03 -15,033,626.51 785,413,051.36 -5,382.81 982,314,812.15
24 22
Total of 10,841,712,214.1 4,723,669,537. 943,676,062 927,165,265 898,195,042 1,227,724,334.
11,245,974,877.97 28,352,668,665.53
assets 9 07 .47 .20 .77 14
Total of 3,152,256,841. 475,124,396 518,501,561
4,906,947,638.38 21,471,975.99 9,031,358,462.07
liabilities 76 .75 .17
(3) If the company has no reportable segments or is unable to disclose the total assets and liabilities of
each reportable segment, it should state the reasons
Not applicable
(4) Other explanations
Nil
7. Major transaction and events influencing investor’s decision
(1) The public security organ has launched a criminal investigation on the contract fraud in which WFTR was cheated in the
process of carrying out “platform trade” business (see announcement No. 2023-007 disclosed by the Company on April 13, 2023
on CNINFO website and other information disclosure websites). At present, the case is in the investigation stage, and the outcome
is uncertain in the future.
(2) Based on the background of “platform trade” business, transaction chain, sales and purchase contract signing, transaction
process, and physical circulation, the Company makes a prudent analysis and comprehensive judgment that it is highly probably
that the business is not a normal trade business. In terms of accounting treatment, the Company follows the principle of substance
over form, and does not treat it as a normal trade business, but treating according to the receipt and payment of funds. The
Company recognizes the purchases actually paid to "the supplier" and sales received from "the customer" as creditor’s rights and
liabilities respectively, and lists in other receivables in net amount in the form of “platform trade” business combination in the
financial statements. In 2022, the outflow amount of the "platform trade" business was 6,345,751,400 yuan, the inflow amount was
3,604,252,300 yuan. As of June 30, 2023, the net outflow amount of 2,542,263,400 yuan was listed in other receivables. An
expected credit loss of 1,644,068,300 yuan has been accrued for this other receivables.
116
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
8. Other
Nil
XVII. Principal notes of financial statements of parent company
1. Account receivable
(1) Classification of account receivable
In RMB
Ending balance
Category Book balance Provision for bad debts
Accrual Book value
Amount Ratio Amount
ratio
Account receivable with provision for bad
7,510,398.26 0.67% 7,510,398.26 100.00%
debts accrual on a single basis
Including:
Account receivable with provision for bad
1,110,640,148.84 99.33% 4,424,184.50 0.40% 1,106,215,964.34
debts accrual on portfolio
Including:
Receivables from customers 961,471,851.93 85.99% 4,424,184.50 0.46% 957,047,667.43
Receivables from internal related parties 149,168,296.91 13.34% 149,168,296.91
Total 1,118,150,547.10 100.00% 11,934,582.76 1.07% 1,106,215,964.34
In RMB
Opening balance
Category Book balance Provision for bad debts
Accrual Book value
Amount Ratio Amount
ratio
Account receivable with provision for bad debts
7,705,636.24 0.84% 7,705,636.24 100.00%
accrual on a single basis
Including:
Account receivable with provision for bad debts
910,831,491.61 99.16% 4,023,208.39 0.44% 906,808,283.22
accrual on portfolio
Including:
Receivables from customers 768,218,575.70 83.63% 4,023,208.39 0.52% 764,195,367.31
Receivables from internal related parties 142,612,915.91 15.53% 142,612,915.91
Total 918,537,127.85 100.00% 11,728,844.63 1.28% 906,808,283.22
Provision for bad debts accrual on single basis: 7,510,398.26 yuan
In RMB
Ending balance
Name Provision for bad
Book balance Accrual ratio Accrual causes
debts
BD bills 7,006,453.02 7,006,453.02 100.00% Have difficulty in collection
Tianjin Lovel Engine Co., Ltd. 503,945.24 503,945.24 100.00% Have difficulty in collection
Total 7,510,398.26 7,510,398.26
Provision for bad debts accrual on portfolio: 4,424,184.50 yuan
In RMB
117
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Ending balance
Name
Book balance Provision for bad debts Accrual ratio
Within 6 months 942,962,791.80
6 months to 1 year 10,647,805.16 1,064,780.52 10.00%
1-2 years 4,685,756.00 937,151.20 20.00%
2-3 years 1,255,410.32 502,164.13 40.00%
Over 3 years 1,920,088.65 1,920,088.65 100.00%
Total 961,471,851.93 4,424,184.50
Explanation on defining the portfolio
If the provision for bad debts of accounts receivable is withdrawn in accordance with the general model of expected credit losses,
please refer to the disclosure of other receivables to disclose related information about provision for bad debts:
□ Applicable Not applicable
By account age
In RMB
Account age Book balance
Within 1 year (inclusive) 1,102,778,893.87
Including: within 6 months 1,092,131,088.71
6 months to 1 year 10,647,805.16
1-2 years 4,685,756.00
2-3 years 1,759,355.56
Over 3 years 8,926,541.67
3-4 years 8,926,541.67
Total 1,118,150,547.10
(2) Provision for bad debts accrual, collected or reversal
Provision for bad debts accrual in the period:
In RMB
Changes in reporting period
Opening
Category Collected or Ending balance
balance Accrual Written-off Other
reversal
Provision for bad debts 11,728,844.63 1,312,598.71 1,106,860.58 11,934,582.76
Total 11,728,844.63 1,312,598.71 1,106,860.58 0.00 0.00 11,934,582.76
Important provision for bad debts collected or reversal in reporting period
In RMB
Name Amount collected o reversal Connection manner
BD bills 195,237.98 Cash
Total 195,237.98
(3) Account receivable actual charged off in the Period
Nil
(4) Top 5 receivables at ending balance by arrears party
In RMB
118
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Ending balance of Ratio in total ending balance of Ending balance of
Name
account receivable accounts receivable provision for bad debts
RBCD 511,841,053.12 45.78% 614,292.02
Client 2 116,795,562.99 10.45% 1,091,831.41
Robert Bosch Company 129,512,038.81 11.58% 37,896.99
WFTR 82,306,474.97 7.36%
WFSC 45,400,733.55 4.06%
Total 885,855,863.44 79.23%
(5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Nil
2. Other accounts receivable
In RMB
Item Ending balance Opening balance
Interest receivable 32,195,758.91 206,325.34
Dividend receivable 1,881,769,939.06
Other accounts receivable 1,292,727,093.72 1,471,896,113.93
Total 3,206,692,791.69 1,472,102,439.27
(1) Interest receivable
1) Category of interest receivable
In RMB
Item Ending balance Opening balance
Interest receivable of subsidiary 32,195,758.91 206,325.34
Total 32,195,758.91 206,325.34
2) Significant overdue interest
Nil
3) Accrual of provision for bad debts
□Applicable Not applicable
119
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Dividends receivable
1) Category of dividends receivable
In RMB
Item (or invested enterprise) Ending balance Opening balance
Zhonglian Electronics 282,000,000.00
RBCD 1,599,769,939.06
Total 1,881,769,939.06
2) Important dividends receivable with account age over one year
Nil
3)Accrual of provision for bad debt
□Applicable Not applicable
(3) Other accounts receivable
1)Other accounts receivable classified by nature
In RMB
Nature Ending book balance Opening book balance
Staff loans and petty cash 909,837.00 1,279,080.00
Balance of related party in the
2,928,006,521.72 3,106,006,521.72
consolidation scope
Margin 3,684,799.33 3,738,299.33
Social security and provident fund paid 6,210,020.64 6,429,166.22
Other 66,670.13 16,781.83
Total 2,938,877,848.82 3,117,469,849.10
2) Accrual of provision for bad debts
In RMB
Phase I Phase II Phase III
Provision for bad Expected credit losses for Expected credit losses for
Expected credit losses Total
debts the entire duration (without the entire duration (with
over next 12 months
credit impairment occurred) credit impairment occurred)
Balance of Jan. 1,
1,505,407.24 1,644,068,327.93 1,645,573,735.17
2023
Balance of Jan. 1,
2023 in the period
Current accrual 577,019.93 577,019.93
Balance on June 30,
2,082,427.17 1,644,068,327.93 1,646,150,755.10
2023
Change of book balance of loss provision with amount has major changes in the period
□Applicable Not applicable
By account age
In RMB
120
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Account age Ending balance
Within 1 year (1 year included) 2,935,464,096.41
Including: within 6 months 2,934,677,969.49
6 months to 1 year 786,126.92
1-2 years 974,922.41
2-3 years 1,050,000.00
Over 3 years 1,388,830.00
3-4 years 1,388,830.00
Total 2,938,877,848.82
3) Provision for bad debts accrual, collected or reversal
Provisions for bad debts accrual in the period:
In RMB
Amount changed in the period
Category Opening balance Ending balance
Accrual Collected or reversal Written-off Other
Provision for bad debts 1,645,573,735.17 577,019.93 1,646,150,755.10
Total 1,645,573,735.17 577,019.93 1,646,150,755.10
4) Other receivables actually charged off during the reporting period
Nil
5) Top 5 other receivables at ending balance by arrears party
In RMB
Ratio in total ending
Account Ending balance of
Name of enterprise Nature Ending balance balance of other
age provision for bad debts
receivables
Balance of related
Within 1
WFTR party in the 2,853,260,000.00 97.09% 1,644,068,327.93
consolidate scope year
Balance of related
Within 6
WFCA party in the 54,193,906.00 1.84%
consolidate scope months
Balance of related
Within 6
WFMA party in the 20,552,615.72 0.70%
consolidate scope months
Zhenkunxing Industrial
Supermarket (Shanghai) Margin 1,000,000.00 2-3 years 0.03% 400,000.00
Co., Ltd.
Wuxi Youlian Thermal Over 3
Margin 750,000.00 0.03% 750,000.00
Power Co., Ltd years
Total 2,929,756,521.72 99.69% 1,645,218,327.93
6) Other accounts receivable related to government grants
Nil
121
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
7) Other receivables derecognized due to the transfer of financial assets
Nil
8) The amount of assets and liabilities formed by transferring other receivables and continuing to be
involved
Nil
3. Long-term equity investments
In RMB
Ending balance Opening balance
Item Depreciati Depreciati
Book balance on Book value Book balance on Book value
reserves reserves
Investment in
3,128,448,081.68 3,128,448,081.68 3,080,762,302.11 3,080,762,302.11
subsidiary
Investment in
associated
4,162,273,276.12 4,162,273,276.12 5,289,081,048.99 5,289,081,048.99
enterprise and
joint venture
Total 7,290,721,357.80 7,290,721,357.80 8,369,843,351.10 8,369,843,351.10
(1) Investment in subsidiary
In RMB
Changes in current period Ending
Opening balance Negative Provision for Ending balance balance of
Invested entity Additional
(book value) Investmen impairment Other (book value) depreciation
Investment reserves
t loss
WFJN 188,389,084.34 517,726.08 188,906,810.42
WFLD 470,853,106.52 698,452.44 471,551,558.96
WFMA 171,807,584.71 238,950.48 172,046,535.19
WFCA 223,351,717.03 161,291.58 223,513,008.61
WFTR 34,067,014.70 71,685.24 34,138,699.94
WFSC 51,490,044.27 21,903.93 51,511,948.20
WFTT 239,283,022.00 292,714.44 239,575,736.44
WFAM 82,454,467.99 82,454,467.99
WFDT 54,081,519.52 5,973.78 54,087,493.30
SPV 1,195,280,223.97 45,630,287.05 1,240,910,511.02
WFLD(Chongqi
265,832.07 17,921.34 283,753.41
ng)
WFAS 878,805.00 28,873.21 907,678.21
WFQL 225,000,000.00 225,000,000.00
VHWX 143,559,879.99 143,559,879.99
Total 3,080,762,302.11 47,685,779.57 3,128,448,081.68
(2) Investment in associated enterprise and joint venture
In RMB
122
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
Current changes (+/ -) Ending
Opening Ending balance
balance Cash balance of
Enterpris Additi Investment Other
(book Capital Other dividend or Impair (book depreciat
e onal gain/loss comprehens Othe
value) reducti equity profit ment value) ion
invest recognized ive income r
on change announced accrual reserves
ment under equity adjustment
to issued
I. Joint venture
II. Associated enterprise
3,505,74 466,508,821. 1,599,769,9 2,372,48
RBCD
6,633.77 06 39.06 5,515.77
Zhonglia
n 1,559,41 179,345,688. 282,000,00 1,456,75
Automo 3,314.05 18 0.00 9,002.23
bile
54,775,8 56,932,7
WFPM 2,156,824.64
99.02 23.66
Chelian 169,145, 169,575,
Tianxia 430,317.51
202.15 519.66
110,0
Lezhuo 106,520,
Bowei 00,00 -3,479,485.20
514.80
0.00
110,0
5,289,08 644,962,166. 1,881,769,9 4,162,27
Subtotal 00,00
1,048.99 19 39.06 3,276.12
0.00
110,0
5,289,08 644,962,166. 1,881,769,9 4,162,27
Total 00,00
1,048.99 19 39.06 3,276.12
0.00
(3) Other explanations
Nil
4. Operating income and cost
In RMB
Amount in current period Amount in last period
Item
Income Cost Income Cost
Main business 1,939,140,764.98 1,537,898,648.30 2,262,029,970.36 1,784,089,964.47
Other business 60,842,681.73 44,901,531.85 149,159,237.68 135,896,195.07
Total 1,999,983,446.71 1,582,800,180.15 2,411,189,208.04 1,919,986,159.54
5. Investment income
In RMB
Item Amount in current period Amount in last period
Investment income from holding trading financial
66,697,793.52 100,780,374.04
asset
Investment income in joint ventures and associated
644,975,916.19 734,429,287.99
enterprises
Total 711,673,709.71 835,209,662.03
123
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
6. Others
Nil
XVIII. Supplementary information
1. Extraordinary gains and losses in the reporting period
Applicable □Not applicable
In RMB
Item Amount Note
Gains/losses from the disposal of non-current asset (Including the offsetting portion of WFJN demolition
124,868,984.10
the provision for impairment of assets that has been withdrawn) compensation
Governmental grants reckoned into current gains/losses (except for those with normal
operation business concerned, and conform to the national policies & regulations and are 40,157,408.73
continuously enjoyed at a fixed or quantitative basis according to certain standards)
Except for effective hedging business related to the normal operation of the company,
fair value gains and losses from holding trading financial assets and trading financial
-14,788,631.85
liabilities, as well as investment income from disposing of trading financial assets,
trading financial liabilities, and available for sale financial assets
Reversal of impairment provision for accounts receivable subject to separate impairment
3,127,091.67
testing
Other non-operating income and expenditure except for the aforementioned items 3,433,420.03
Less: Impact on income tax 18,140,350.17
Impact on minority shareholders’ equity 20,775,314.33
Total 117,882,608.18 --
Specific information on other items of profits/losses qualified the definition of extraordinary gains and losses
□Applicable Not applicable
The Company has no other items of profits/losses qualified the definition of extraordinary gains and losses
Information on the definition of extraordinary gains and losses that listed in the Q&A Announcement No.1 on Information
Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Gains and Losses as the recurring profit/loss
□Applicable Not applicable
2. ROE and earnings per share
Earnings per share
Weighted Diluted
Profits during reporting period Basic earnings
average ROE earnings per
per share
share
(RMB/Share)
(RMB/Share)
Net profit attributable to common shareholders of the company 5.24% 0.98 0.98
Net profit attributable to common shareholders of the company after
4.59% 0.85 0.85
deducting nonrecurring gains and losses
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable Not applicable
124
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. Semi-Annual Financial Reprot 2023
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable Not applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for the
differences adjustment audited by foreign auditing institute, listed name of the institute
Nil
4. Other
Nil
125
