Hangzhou Robam Appliances Co., Ltd.
2019 Full Annual Report
April 2020
Section 1 Important Notes, Contents and Definitions
The board of directors, the board of supervisors and directors, supervisors andsenior management of the Company hereby guarantee that no false or misleadingstatement or major omission was made to the materials in this report and that theywill assume all the responsibility, individually and jointly, for the authenticity,accuracy and completeness of the contents of the annual report.Ren Jianhua, the head of the Company, Zhang Guofu, the head of accounting work,and Zhang Guofu, the head of accounting body (accountant in charge), guaranteethe authenticity, accuracy and completeness of the financial report in the annualreport.All directors of the Company personally attended the board meeting for reviewingthis report.The Company has risks such as fluctuations in the real estate market, pricefluctuations of raw materials and intensifying market competition. See Section IV IXrisk factors in this report for details. Please pay attention to the investment risks.The preplanned profit distribution deliberated and approved by the board ofdirectors is as follows: taking 949,024,050 shares as the radix, the Company willsend cash dividends of 5 yuan (tax included) and 0 bonus share (tax included) to allshareholders for every 10 shares, and instead of converting capital reserve intoshare capital.
Contents
Section 1 Important Notes, Contents and Definitions ...... 2
Section 2 Company Profile and Major Financial Indicators ...... 5
Section 3 Business Summary ...... 10
Section 4: Discussion and Analysis of Operation ...... 14
Section 5 Important Matters ...... 32
Section 6 Changes in Shares and Shareholders ...... 48
Section 7 Preferred Shares ...... 55
Section 8 Convertible Bonds ...... 56
Section 9 Directors, Supervisors, Senior Management and Employees ...... 57
Section 10 Corporate Governance ...... 70
Section 11: Corporate Bonds ...... 77
Section 12: Financial Report ...... 78
Section 13: Reference file directory ...... 203
Definitions
| Terms | Refers to | Definition |
| The Company, company, Robam Appliances | Refers to | Hangzhou Robam Appliances Co., Ltd. |
| Mingqi | Refers to | Hangzhou Mingqi Electric Co., Ltd. |
| Kinde Intelligent | Refers to | Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. |
| This group | Refers to | Robam Appliances, Mingqi, Beijing Robam Electric Appliance Sales Co., Ltd., Shanghai Robam Electric Appliance Sales Co., Ltd. and Kinde Intelligent |
| Robam Group | Refers to | Hangzhou Robam Industrial Group Co., Ltd., controlling shareholder of the Company |
| Reporting period | Refers to | Year 2019 |
| CMM | Refers to | China Market Monitor Co., Ltd., an authoritative domestic home appliance market research company |
| AVC | Refers to | Beijing All View Cloud Data Technology Co., Ltd. |
| Industry online | Refers to | Beijing Zhixindao Sci-tech Corp., Ltd. |
Section 2 Company Profile and Major Financial Indicators
I. Company Profile
| Stock abbreviation | Robam | Stock code | 002508 |
| Stock exchange for stock listing | Shenzhen Stock Exchange | ||
| Company name in Chinese | 杭州老板电器股份有限公司 | ||
| Company short name in Chinese | 老板电器 | ||
| Company name in foreign language (if any) | HANGZHOU ROBAM APPLIANCES CO.,LTD. | ||
| Company short name in foreign language (if any) | ROBAM | ||
| Legal representative of the Company | Ren Jianhua | ||
| Registered address | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China | ||
| Postal code of the registered address | 311100 | ||
| Office address | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China | ||
| Postal code of the office address | 311100 | ||
| Company website | http://www.robam.com/ | ||
| robam@robam.com | |||
II. Contact person and contact information
| Secretary to the board of directors | Securities affairs representative | |
| Name | Wang Gang | Jiang Yu |
| Contact address: | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China |
| Tel | 0571-86187810 | 0571-86187810 |
| Fax | 0571-86187769 | 0571-86187769 |
| wg@robam.com | jy@robam.com |
III. Information disclosure and keeping place
| Name of media selected by the Company for information disclosure | Securities Times, China Securities Journal, Securities Daily |
| Website designated by China Securities Regulatory Commission for annual report | http://www.cninfo.com.cn |
| Place of preparation of the Company’s annual report | Board office |
IV. Registration Changes
| Organization code | 725252053 |
| Changes in main business since the Company's listing (if any) | No changes |
| Changes of controlling shareholders (if any) | No changes |
V. Other Relevant InformationAccounting firm engaged by the Company
| Name of the accounting firm | Shinewing Certified Public Accountants (special general partnership) |
| Office address of the accounting firm | 9/F, Block A, Fuhua Mansion, No.8 Chaoyangmen North Street, Dongcheng District, Beijing |
| Name of signatory accountant | Lei Yongxin, Gao Zhiying |
The sponsor institution engaged by the Company to perform the continuous supervision responsibility during the reportingperiod
□ Applicable √ Not applicable
The financial advisor engaged by the Company to perform the continuous supervision responsibility during the reportingperiod
□ Applicable √ Not applicable
VI. Major Accounting Data and Financial Indicators
Whether the Company needs to retroactively adjust or restate the accounting data of the previous years
□Yes √No
| 2019 | 2018 | Increase/decrease this year compared to the previous year | 2017 | |
| Operating income (yuan) | 7,760,581,855.53 | 7,424,885,274.14 | 4.52% | 7,017,397,057.99 |
| Net profits attributable to | 1,589,814,847.80 | 1,473,579,665.62 | 7.89% | 1,461,213,518.63 |
| shareholders of listed companies (yuan) | ||||
| Net profits attributable to shareholders of the listed company after deduction of non-recurring profits and losses (yuan) | 1,516,979,830.78 | 1,390,626,550.21 | 9.09% | 1,406,448,536.49 |
| Net cash flow from operating activities (yuan) | 1,555,220,926.90 | 1,508,960,311.29 | 3.07% | 1,272,482,554.23 |
| Basic EPS (yuan/share) | 1.68 | 1.55 | 8.39% | 1.54 |
| Diluted EPS (yuan/share) | 1.68 | 1.55 | 8.39% | 1.54 |
| Weighted average return on net assets | 25.10% | 26.40% | -1.30% | 31.66% |
| End of 2019 | End of 2018 | Increase/decrease at the end of this year compared to the end of the previous year | End of 2017 | |
| Total assets (yuan) | 10,651,922,572.87 | 9,455,361,508.83 | 12.65% | 7,926,615,151.63 |
| Net assets attributable to shareholders of listed companies (yuan) | 6,864,388,881.46 | 6,045,384,387.57 | 13.55% | 5,260,800,800.91 |
VII. Differences in Accounting Data under Domestic and Foreign AccountingStandards
1. Differences between net profits and net assets in financial statements disclosed according tothe International Accounting Standards (IAS) and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
No difference between net profits and net assets in financial statements disclosed according to the InternationalAccounting Standards (IAS) and Chinese Accounting Standards during the reporting period.
2. Differences between net profits and net assets in financial statements disclosed according tothe Overseas Accounting Standards and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
No difference between net profits and net assets in financial statements disclosed according to the Overseas AccountingStandards and Chinese Accounting Standards during the reporting period.
VIII. Key Quarterly Financial Indicators
Unit: yuan
| Q1 | Q2 | Q3 | Q4 | |
| Operating income | 1,660,339,786.05 | 1,867,074,096.91 | 2,097,606,924.30 | 2,135,561,048.27 |
| Net profits attributable to shareholders of listed companies | 319,653,959.87 | 350,750,034.33 | 415,223,408.27 | 504,187,445.33 |
| Net profits attributable to shareholders of the listed company after deduction of non-recurring profits and losses | 274,850,672.48 | 347,688,906.53 | 410,778,645.33 | 483,661,606.44 |
| Net cash flow from operating activities | 169,903,804.03 | 488,787,280.55 | 376,523,778.18 | 520,006,064.14 |
Whether there is significant difference between the above financial indicators or the total sum of them and the financialindicators related to the quarterly report and semiannual report disclosed by the Company
□Yes √No
IX. Non-recurring Profit and Loss Items and Amount
√Applicable □ Not applicable
Unit: yuan
| Item | Amount in 2019 | Amount in 2018 | Amount in 2017 | Description |
| Profits and losses on the disposal of non-current assets (including the write-off part of the provision for asset impairment) | -158,607.19 | -27,525.06 | 140,679.28 | |
| Government subsidies included into the current profits and losses, except those government subsidies, which are closely related to the business of a company and enjoyed in accordance with a certain standard quota or quantity of the state | 88,113,806.09 | 98,235,805.08 | 63,256,777.88 | |
| Profits and losses from investment or management assets entrusted to others | 285,386.29 | 1,133,150.69 | ||
| Income and expenditure other than those mentioned above | -1,884,306.56 | 1,916,399.82 | -347,030.63 | |
| Less: Amount affected by income tax | 13,290,725.11 | 17,276,844.91 | 9,418,595.08 | |
| Amount of minority shareholders' equity affected (after tax) | -54,849.79 | 180,105.81 | ||
| Total | 72,835,017.02 | 82,953,115.41 | 54,764,982.14 | -- |
Explain the non-recurrent profit and loss items defined by the Company according to the Interpretative Announcement No.1 on Information Disclosure of Public Securities Issuing Companies - Non-recurrent Profits and Losses and defined from
the non-recurrent profit and loss items enumerated in the Interpretative Announcement No. 1 on Information Disclosure ofPublic Securities Issuing Companies - Non-recurrent Profits and Losses
□ Applicable √ Not applicable
No definition of non-recurrent profit and loss items defined and enumerated in the Interpretative Announcement No. 1 onInformation Disclosure of Public Securities Issuing Companies - Non-recurrent Profits and Losses as non-recurrent profitand loss items during the reporting period.
Section 3 Business Summary
I. Main Business of the Company during Reporting Period(I) Main businessDedicated to creating a new quality kitchen for millions of families, the Company takes foot in the kitchenfield and focuses on the development, production, sales and comprehensive services of kitchenappliances, including range hoods, gas hobs, disinfection cabinets, steam ovens, ovens, dishwashers,water purifiers, water heaters, microwaves and integrated hobs. After 40 years of development andgrowth, the Company has become the manufacturer with the longest history, the highest market shareand the largest production capacity in the Chinese kitchen appliance industry. The Company hasachieved the best sales of range hoods in China for 22 years and the world for five consecutive years.(II) Development Stage of IndustryAccording to the National Economic and Social Development Statistics Bulletin 2019 issued by theNational Bureau of statistics, by the end of 2019, the urbanization rate of the country's permanentpopulation was 60.60%, 1.02 percentage points higher than that at the end of the previous year. In thelong run, according to the State Council's population development plan, by 2030, China's urbanizationrate will reach 70%. Thanks to the increasing urbanization rate, there is still a huge space in the kitchenappliance industry. According to industry online data, in 2019, the internal sales volume of range hoodswas only 17.43 million, down 2.73% year-on-year from 2018. However, in general, the penetration rate ofrange hoods is still low. According to China's industrial information data, in 2018, the urban retention rateof range hoods was 79.09 sets / 100 households, while in rural areas, it was 26.00 sets / 100 households.Compared with the urban retention rate of refrigerators and washing machines, they were respectively
100.92 and 97.69 sets / 100 households, with the rural retention rate of 95.87 and 88.55 sets / 100households, respectively. The penetration rate of range hoods is expected to further improve, and thekitchen appliance industry is still promising.In recent years, the government has proposed to strengthen the renovation of old urban areas, andplaned to start 39,000 new projects for old urban areas and 7 million new projects for old urban houses.At the same time, the market has accumulated a large number of needs to be updated, the renewal of
traditional products such as range hoods and gas hobs, and the increasing popularity of new categoriessuch as steamers, steam oven-ovens and dishwashers. With the transaction of second-hand housesand the renovation of old residential areas, the renewal needs will be released step by step.According to the 13th Five-year Plan for Development of Construction Industry, the encouraging policiesfor the delivery of full decoration of new buildings should be formulated to increase the delivery ratio offull decoration in new buildings, and it is clearly proposed that by 2020, the area of newly commencedfull decoration finished houses will reach 30%. Compared with 70-80% of the refined decoration ratio indeveloped countries, the refined decoration rate in China still has a large room for improvement. Inaddition, the refined decoration kitchen appliance products are still mainly two-piece set of range hoodand gas hob. With the increasing demand for kitchen functions, the matching rate of new categoriessuch as steamer, oven and dishwasher will gradually increase.The new market and stock market will jointly support the future development space of the kitchenappliance industry. Meanwhile, the consumption upgrade of the kitchen appliance industry is stillcontinuing. In the short term, integrated technology products will focus on solving the contradictionbetween people's demand for the expansion of kitchen appliances and kitchen space. Integratedproducts such as integrated hobs and steam oven-ovens have been more and more recognized byconsumers. In the long run, artificial intelligence, Internet of Things and other technologies will lead theupgrade of intelligent products and the transformation of kitchen appliance industry.II. Significant Changes in Prime Assets
1. Significant Changes in Prime Assets
| Prime assets | Significant changes |
| Equity assets | The long-term equity investment increased by 59.23% year on year in the reporting period, and the profits of the Company's equity asset joint venture De Dietrich Trading (Shanghai) Co., Ltd. in the current period was caused by the corresponding increase in investment income attributed to the Company. |
| Fixed assets | No significant change in the Company’s fixed assets during the reporting period. |
| Intangible assets | No significant change in the Company’s fixed assets during the reporting period. |
| Construction in progress | The construction in progress increased by 47.59% year on year in the reporting period, which was mainly caused by the infrastructure investment in Maoshan Intelligent Manufacturing Park in the current year. |
2. Major overseas assets
□ Applicable √ Not applicable
III. Analysis of Core CompetitivenessNo significant change in the Company's core competitiveness during the reporting period: TheCompany's core competitiveness is mainly reflected in the high-end positioned the brand capacity,continuous innovative research and development capacity, comprehensive and efficient operationcapacity.
1. Brand capability of high-end positioning
ROBAM, founded in 1988, has established a significant brand advantage in the kitchen applianceindustry. Since 1991, ROBAM range hood has won the only "Quality Silver Award of the People'sRepublic of China", "China Famous-brand Product", "National Inspection-free Product" in the kitchenappliance industry; ROBAM has been recognized as "China Famous Brand"; ROBAM has won "MostInfluential Brand in China's Kitchen Appliance Industry" and "China's 500 Most Valuable Brands". Aftermore than 30 years of efforts, it continues to deepen the positioning of "big suction" and create high-endbrand experience. "Big suction" has become the synonym of "high-end range hood", and the ROBAMhas become one of the most famous and favorite professional high-end kitchen appliance brands inChina. In 2015, ROBAM represented China's high-end manufacturing and landed at Milan Expo, and in2016, it landed at IFA exhibition in Germany, which improved the ROBAM's high-end image andinternational influence. In 2018, ROBAM Appliances put forward a new brand concept, that is, to "createChina’s new kitchen." According to the survey data released by Euromonitor International, the world'sauthoritative market research organization, ROBAM Appliances’ range hood won the first market shareof global range hood private brand market for five consecutive years from 2015 to 2019. In addition,ROBAM has been rated as one of the "BrandZ Top 100 Most Valuable Chinese Brands" for 6consecutive years, and awarded the "Top 500 Asian Brands" for 14 consecutive years. In 2019, the 40thanniversary of the Company, ROBAM Appliances had again made a splendid achievement as it, with a
brand value worth 11.798 billion yuan and the industry-first advantage, ranked among the light industrysector top ten winners of the "BrandZ Top 100 Most Valuable Chinese Brands."
2. R & D capability of continuous innovation
The mission of the Company is to render happiness of kitchen life for more families, by improving theexisting cooking environment based on continuous research on technology to bring healthy and relaxedcooking life to users with cooking fun. For this reason, the Company adheres to the principle of "productleading" and constantly pursues "technology leading". The Company now has a national technologycenter, a national laboratory, a national industrial design center, California institute of innovation,Shenzhen innovation research institute and academician workstation of Tsinghua University. In 2019,the Company applied for 509 patents, including 115 invention patents and obtained 417 patent licenses,including 11 invention patents. The Company participates in the formulation of international standardproposals, leads the formulation of national, industrial and group standards, and is a national intellectualproperty demonstration enterprise.
3. Comprehensive and efficient operation capability
The Company has the leading marketing capability in the industry: the Company adopts the only agencymarketing mode in the industry, and creates the most comprehensive, efficient and responsivemarketing system in the industry through strong management and control, equity incentive and the defacto business partner system.It deepens intelligent manufacturing, lean operation and technology driven, and comprehensively buildsthe industry's first supply chain system. It looks at global manufacturing and becomes a first-classmanufacturing benchmark in China. " In addition, informatization, as the subject of the Company'spromotion of "in-depth integration of informatization and industrialization", focuses on the interactiveinnovation and continuous optimization of data, technology, business process and organizationalstructure, constantly creates new capabilities in the informatization environment, and improves thesustainable competitiveness in the domestic and foreign markets.
Section 4: Discussion and Analysis of OperationI. OverviewIn 2019, the regulation and control situation of the real estate industry was still severe, while the kitchenappliance industry was in its overall downturn and, at the same time, the differentiation of channelperformance increased. In terms of retail channel, according to the monthly data report of offline retailmarket monitoring of All View (hereinafter referred to as "All View offline report"), the retail sales of maincategories of kitchen appliances, such as range hoods, gas hobs and sterilizer cabinets, increased by-11.4%, -8.5%, -18.1% respectively compared with the same period of last year, which have declined bya large proportion for two consecutive years. In terms of e-commerce channel, according to the monthlydata report of online retail market monitoring of All View (hereinafter referred to as "All View onlinereport"), the retail sales of kitchen appliance packages, range hoods and gas hobs increased by -4.2%,
12.6%, 26.5% respectively compared with the same period of last year, and the performance of kitchenappliance single products was better than the kitchen appliance packages. In terms of engineeringchannel, according to the 2019 annual report on kitchen appliance products in China's real estate refineddecoration market (hereinafter referred to as "All View refined decoration report"), the market of refineddecoration kitchen appliances in 2019 increased by 26.4% year on year, showing a rapid growth trend.Facing the continuous downturn of the whole industry, the Company, as the industry leader, closelyfocused on the annual business philosophy of "keep practicing internal skills to keep out the cold, seekimprovement in stability to promote growth", coordinated development through multiple channels,realized the operating revenue of 7,760,581,855.53 yuan in 2019, with a year-on-year growth of 4.52%;and realized the net profit of 1,589,814,847.80 attributable to the shareholders of the listed company,with a year-on-year increase of 7.89%, which were all better than the average growth rate of the industry.According to the All View offline report, the market share and market position of the offline retail sales ofCompany's major product categories are shown in the following table:
| Range hood | Gas hobs | Sterilizer cabinet | Built-in steam & grill oven | Built-in electrical steam oven | Built-in electric oven | Built-in microwave oven | Built-in sterilizer cabinet | Built-in dishwasher |
| 28.10% | 25.60% | 22.70% | 21.60% | 31.60% | 25.40% | 35.60% | 27.80% | 7.00% |
| 1 | 1 | 2 | 2 | 2 | 2 | 1 | 2 | 4 |
According to the All View online report, the market share and market position of the online retail sales of Company's
major product categories are shown in the following table:
| Kitchen appliance packages | Range hood | Gas hobs | Sterilizer cabinet | Built-in electrical steam oven | Built-in sterilizer cabinet |
| 25.90% | 15.60% | 8.10% | 5.10% | 17.60% | 9.90% |
| 1 | 2 | 4 | 4 | 1 | 3 |
According to the All View refined decoration report, the market share of ROBAM in refined decorationchannel is 36.3%, ranking first in the industry.In 2019, the marketing sector adhered to the practice of innovation for customer requirements centeredon the customer, continuous upgrading of products and services, and multi-channel development andcomplementarity to ensure the Company's performance growth. In terms of retail channel, facing theoverall downturn of KA channel, the Company sticked to the high-end positioning of the brand anddeepened and optimized the franchise store system. At the same time, it strengthened the integration ofmultiple channels to achieve the mutual flows and coordinated development of online and offlinechannels. In addition, it innovated its marketing methods and upgrade them, and actively dug into thestock market. In terms of e-commerce channel, facing the shrinking channel dividend, the Companyactively embraced the changes in customer demand for products, improved the flow conversion rate andoptimized the operating efficiency with the focus on “deepening customer operation and creatingextreme efficiency”. In terms of engineering channel, the national real estate refined decoration policywas implemented rapidly, and channel dividend appeared. The Company deepened the cooperationwith the real estate developers such as Evergrande, Country Garden,Vanke, and Sunac with high-qualitybrand services and continued to boost the development of strategic engineering channel customersthrough the Central Cleaning System. The sales volume of engineering channel increased by 90% yearon year. In terms of innovate channel, the Company created innovative sales platform, and grasped thefront-end flow entrance of consumers. Through in-depth cooperation with Schmidt, Weishang and otherwhole house customization companies, as well as home decoration companies such as Ikongjian, GoldMantis, and Dong Yi Ri Sheng, the Company strengthened the brand moat, opened up channels andoutlets, and stimulated the vitality of home decoration. In terms of overseas channel, focusing on the fourmajor markets of North America, Australia and New Zealand, India and Malaysia, the Company activelyexplored the market, determined the brand positioning of "global leader of high-end kitchen appliances",
comprehensively promoted the globalization of "ROBAM" brand, and enhanced the internationalinfluence of the brand.In 2019, the technology sector was committed to building a research and development mechanismwith equal emphasis on efficiency and vitality, focusing on products, creating a first-class technical teamin the industry, and made remarkable achievements in new category expansion, patent developmentand national standard establishment. The Company actively created the second category of Chinesestyle steam ovens, such as SZ01 lower built-in steam oven, ST01 desktop steam oven and C906/905steam oven-oven, to meet different customer needs with diverse product forms, inherit and carry forwardtraditional cooking and food culture. The Company actively arranges the third category with dishwasheras the core, independently developed and reserved a number of products, with rich category echelons.During 2019, the Company applied for 509 patents, including 115 invention patents and obtained 417patent licenses, including 11 invention patents. The range hood 27X6 and steam oven-oven C906 wonthe "German Red Dot Award" and "American IDEA award", while the range hood 700X, gas hob 666B,steam ovens S228 and SZ01 won the “American IDEA award”. The gas hood 9B30C and integratedrange hood RIKA won Taiwan's “2019 Gold Dot Award”. At the same time, the Company participated inthe international proposal of "Safety of Household Appliances - Particular Requirements for RangeHoods", led the formulation of national standards "Particular Requirements for Electric Cooking Ranges,Ovens, Grills, Microwave Ovens and Any Combination of These", formulation of 2 industry standards"Electric Steamers", "Minimum Allowable Values of Energy Efficiency and Energy Efficiency Grades forElectric Ovens", as well as 4 group standards "Environment-friendly Range Hoods" and "TechnicalSpecification for Noise and Sound Quality of Range Hoods", "Steam Oven-ovens" and "ReverseOsmosis Water Purifiers", and won the national intellectual property demonstration enterprise.In 2019, the production sector continued to focus on the three core objectives of "comprehensively buildthe industry-leading supply chain system driven by technology", "comprehensively realize innovation inlean production", "build an industry benchmark intelligent factory", and a number of core tasks were fullyimplemented. Supply chain collaboration projects promote synchronous and consistent production,supply and marketing information, zero distance between customers, fast and efficient collaboration withfront and rear ends, and maximum use of supply chain resources; pull production projects improveinventory turnover by optimizing pull planning and scheduling and implementing pull replenishment;
supply chain capacity improvement projects improve data empowerment, and efficient collaboration.Through sorting out the core data information foundation and business process of production sectoroperation, the Company comprehensively promoted the efficient operation capacity of productionsystem information. Moreover, Maoshan Intelligent Manufacturing Park project of the Company wasconstructed smoothly and, after its completion, it will promote the iteration of the Company's intelligentand integrated high-end kitchen electric appliances and upgrading of the intelligent manufacturing,laying a solid foundation for the Company's long-term development.In 2019, the brand sector fully implemented the concept of "creating a new kitchen in China", inheritedand innovated the essence of Chinese culinary culture, used modern technology to transform Chinesekitchens, redefined Chinese cooking, and facilitated changes of Chinese cooking life, so that everyfamily would enjoy the authentic China taste, and restore the human interest in Chinese kitchens. TheCompany participated in 2019 AWE, created the exhibition theme of “Robam 40 years, creating newChinese kitchen”; It worked together with Guochao pioneer band “New Pants” to create the "RobamAppliances Guochao Music Kitchen"; solved the problem of Spring Festival organizing with theintegrated kitchen appliances, creating the "happy box of organizing", deeply interacting with consumers,and further deepening the brand's younger image. It embraced the era of digital marketing, vigorouslypromoted the popularization of the second category of steam ovens, and spared no effort to build a"kitchen second center”; It held the press conference of "Steamed flavor of China. Exploring flavor of tencities" and offline activities such as "Lei Jiayin, a high-power player in the kitchen, is challenged to cook100 steamed dishes", invited cooking masters and intangible cultural heritage inheritors to create asteam culture tour of "one city, one flavor and one inheritor", published China’s Steamed Flavor Map -100 Steamed Dishes, Long Volume of China's Steaming Feast, etc., inheriting and innovating theChinese steaming culture. At the same time, the Company defined the Chinese-style powerfuldishwasher as its third category, and continuously strengthened the high-end image of the brand. Itexclusively sponsored CCTV's "Chinese Flavor" program, and served as the food creation officer of"Chinese Restaurant 3", transmitting Chinese cooking culture, deeply interacting with consumers, andtransmitting high-end brand value.In 2019, Mingqi put forward the new strategic layout of “big business recruitment, Suning cooperation,engineering layout and home decoration integration". In terms of the products, it "focused on smoke
stoves, expanded double water, innovated the new retail of integrated stoves", and constantly enrichedcategories of water purifiers, gas water heaters, integrated stoves, etc. Offline retail realized thetransformation from quantity to quality, and through the “Kunpeng Plan”, the nationwide recruitment oflarge companies was realized. It enriched online channel marketing means, empower new retail, furtherexpanded engineering and home decoration channels, and the channels were diversified indevelopment. Kinde insisted on independent R & D and original design, enjoyed a good reputation in theindustry for its craftsmanship and stable quality. It invested to build an intelligent integrated kitchenecological industrialization project, and established intelligent integrated kitchen R & D centers, nationalspecification laboratories, intelligent factories, brand operation centers, and customer experience halls.In 2019, the Company dug deep into the intrinsic value, delivered value investment, and continued to berecognized by the capital market in terms of corporate governance, internal management andshareholder returns, and won the "Best Board Award” and "Best new media operator award" at the“Tianma Award - The 10th Listed Company Investor Relations Selection” of Securities Times, the 13thChina listed company value selection "top 50 SMEs board value", "Best board secretary award","excellent SMEs board secretary", "outstanding board secretary of information disclosure" and otherawards at the 13th Chinese Listed Companies Value Appraisal. The Company's board secretary enteredthe "Hall of fame for gold board secretary" of the New Fortune. The Company deeply cultivated thebrand value and spread the brand energy, and the brand power constantly improved. In 2019, the 40thanniversary of the Company, ROBAM Appliances had again made a splendid achievement as it, with abrand value worth 11.798 billion yuan and the industry-first advantage, ranked among the light industrysector top ten winners of the "BrandZ Top 100 Most Valuable Chinese Brands."
II. Main business analysis
1. Overview
See “I. Overview” in “Discussion and Analysis of Operation”.
2. Revenue and Costs
(1) Operating income composition
Unit: yuan
| 2019 | 2018 | Year-on-year |
| Amount | Proportion in operating income | Amount | Proportion in operating income | increase/decrease | |
| Total operating income | 7,760,581,855.53 | 100% | 7,424,885,274.14 | 100% | 4.52% |
| By industry | |||||
| Home and kitchen & bath appliances | 7,589,302,689.33 | 97.79% | 7,219,989,872.63 | 97.24% | 5.12% |
| Other | 171,279,166.20 | 2.21% | 204,895,401.51 | 2.76% | -16.41% |
| By product | |||||
| Range hood | 4,081,545,017.88 | 52.59% | 4,012,977,970.34 | 54.05% | 1.71% |
| Gas hobs | 1,843,440,109.62 | 23.75% | 1,792,008,723.86 | 24.14% | 2.87% |
| Sterilizer cabinet | 560,848,048.70 | 7.23% | 499,849,319.18 | 6.73% | 12.20% |
| Steam ovens | 245,373,245.51 | 3.16% | 258,517,022.09 | 3.48% | -5.08% |
| Oven | 140,846,016.00 | 1.81% | 190,285,923.41 | 2.56% | -25.98% |
| Dish-washing machine | 138,025,125.30 | 1.78% | 104,709,019.53 | 1.41% | 31.82% |
| Water purifier | 77,528,039.72 | 1.00% | 83,904,311.28 | 1.13% | -7.60% |
| Integrated hob | 211,906,015.61 | 2.73% | 97,196,309.44 | 1.31% | 118.02% |
| Microwave ovens | 11,510,249.18 | 0.15% | 21,392,042.65 | 0.29% | -46.19% |
| Steam oven-oven | 127,740,642.01 | 1.65% | 3,345,789.85 | 0.05% | 3,717.95% |
| Other small home appliances | 150,540,179.80 | 1.94% | 155,803,441.00 | 2.10% | -3.38% |
| Other | 171,279,166.20 | 2.21% | 204,895,401.51 | 2.76% | -16.41% |
| By region | |||||
| East China - main products | 3,295,823,380.45 | 42.47% | 3,100,771,333.46 | 41.77% | 6.29% |
| East China - other | 171,279,166.20 | 2.21% | 204,895,401.51 | 2.76% | -16.41% |
| South China | 1,110,071,492.74 | 14.30% | 927,516,722.45 | 12.49% | 19.68% |
| Central China | 808,538,868.51 | 10.42% | 747,906,957.98 | 10.07% | 8.11% |
| North China | 906,014,918.04 | 11.67% | 920,152,103.68 | 12.39% | -1.54% |
| Northeast China | 416,692,738.11 | 5.37% | 454,944,067.36 | 6.13% | -8.41% |
| Northwest China | 390,575,627.50 | 5.03% | 383,204,044.62 | 5.16% | 1.92% |
| Southeast China | 618,037,810.38 | 7.96% | 658,484,684.33 | 8.87% | -6.14% |
| Overseas regions | 43,547,853.60 | 0.56% | 27,009,958.75 | 0.36% | 61.23% |
(2) Industries, products or regions that account for more than 10% of the Company's operatingincome or profit
√Applicable □ Not applicable
Unit: yuan
| Operating income | Operating cost | Gross margin ratio | Year-on-year increase/decrease of operating income | Year-on-year increase/decrease of operating cost | Year-on-year increase/decrease of gross margin ratio | |
| By industry | ||||||
| Home and kitchen & bath appliances | 7,589,302,689.33 | 3,482,255,262.10 | 54.12% | 5.12% | 3.64% | 1.22% |
| By product | ||||||
| Range hood | 4,081,545,017.88 | 1,695,142,028.00 | 58.47% | 1.71% | -1.41% | 2.30% |
| Gas hobs | 1,843,440,109.62 | 810,899,455.60 | 56.01% | 2.87% | 0.88% | 1.57% |
| By region | ||||||
| East China | 3,295,823,380.45 | 1,444,968,322.20 | 56.16% | 6.29% | 3.09% | 2.49% |
| South China | 1,110,071,492.74 | 565,761,412.81 | 49.03% | 19.68% | 22.08% | -2.00% |
| Central China | 808,538,868.51 | 404,263,906.51 | 50.00% | 8.11% | 8.36% | -0.24% |
| North China | 906,014,918.04 | 368,535,711.26 | 59.32% | -1.54% | -4.12% | 1.89% |
In the case that the statistical standards for main business data of the Company are adjusted during the reporting period,the main business data of the Company in recent 1 year are subject to those after the adjustment of the statisticalstandards at the end of the reporting period
□ Applicable √ Not applicable
(3) Whether the Company's physical sales revenue is greater than the service revenue
√Yes □ No
| Industry category | Item | Unit | 2019 | 2018 | Year-on-year increase/decrease |
| Home and kitchen & bath | Sales quantity | Unit | 6,748,364 | 6,526,866 | 3.39% |
| Production | Unit | 6,858,755 | 6,984,828 | -1.80% |
| appliances | output | ||||
| Inventory | Unit | 2,118,035 | 2,092,863 | 1.20% |
Reasons for more than 30% year-on-year changes in the relevant data
□ Applicable √ Not applicable
(4) Performance of major sales contracts signed by the Company up to the reporting period
□ Applicable √ Not applicable
(5) Composition of operating cost
Industry and product categories
Unit: yuan
| Industry category | Item | 2019 | 2018 | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
| Home and kitchen & bath appliances | Manufacturing costs | 208,262,654.93 | 5.87% | 214,977,275.62 | 6.23% | -3.12% |
| Raw materials | 3,136,357,317.10 | 88.38% | 3,048,699,206.25 | 88.35% | 2.88% | |
| Labor | 204,157,773.01 | 5.75% | 187,088,760.42 | 5.42% | 9.12% | |
Unit: yuan
| Product Classification | Item | 2019 | 2018 | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
| Range hood | Manufacturing costs | 129,045,682.66 | 3.64% | 137,212,784.79 | 3.98% | -5.95% |
| Raw materials | 1,540,838,865.26 | 43.42% | 1,466,296,284.77 | 42.49% | 5.08% | |
| Labor | 120,967,885.34 | 3.41% | 115,823,061.19 | 3.36% | 4.44% | |
| Gas hobs | Manufacturing costs | 27,252,228.82 | 0.77% | 25,278,343.21 | 0.73% | 7.81% |
| Raw materials | 819,836,099.04 | 23.10% | 749,335,172.41 | 21.72% | 9.41% | |
| Labor | 31,416,487.79 | 0.89% | 29,206,306.14 | 0.85% | 7.57% | |
| Sterilizer | Manufactu | 28,858,109.82 | 0.81% | 26,839,928.57 | 0.78% | 7.52% |
| cabinet | ring costs | |||||
| Raw materials | 307,485,018.62 | 8.66% | 261,627,258.72 | 7.58% | 17.53% | |
| Labor | 22,973,305.66 | 0.65% | 19,761,122.28 | 0.57% | 16.26% | |
| Other | Manufacturing costs | 23,106,633.62 | 0.65% | 25,646,219.05 | 0.74% | -9.90% |
| Raw materials | 468,197,334.19 | 13.19% | 571,440,490.35 | 16.56% | -18.07% | |
| Labor | 28,800,094.22 | 0.81% | 22,298,270.81 | 0.65% | 29.16% |
(6) Whether the consolidation scope changes in the reporting period
□Yes √No
(7) Major changes or adjustments of business, products or services of the Company during thereporting period
□ Applicable √ Not applicable
(8) Major sales customers and major suppliers
Major sales customers of the Company
| Total sales amount of top five customers (yuan) | 2,386,920,682.00 |
| Proportion of total sales amount of top five customers in total annual sales | 30.76% |
| Among the sales amount of top five customers, proportion of sales amount of related parties in total annual sales | 0.00% |
Top 5 customers of the Company
| No. | Customer name | Sales Amount (yuan) | Proportion in total annual sales |
| 1 | Beijing Jingdong Century Trading Co., Ltd. | 777,590,928.24 | 10.02% |
| 2 | Tmall ROBAM Appliances Flagship Store | 618,934,645.40 | 7.98% |
| 3 | Suning Purchase Center of Suning.Com Group Co., Ltd. | 402,540,576.79 | 5.19% |
| 4 | Shenzhen Country Garden Supply Chain / Shenzhen Bisheng Development Co., Ltd. (head) | 344,158,089.58 | 4.43% |
| 5 | Tmall ROBAM Appliances Distributor | 243,696,442.41 | 3.14% |
| Total | -- | 2,386,920,682.42 | 30.76% |
Other information of major customers
□ Applicable √ Not applicable
Major suppliers of the Company
| Total purchase amount of top five suppliers (yuan) | 701,145,032.60 |
| Proportion of total purchase amount of top five suppliers in total annual purchase amount | 22.08% |
| Among the purchase amount of top five suppliers, proportion of purchase amount of related parties in total annual purchase amount | 0.00% |
Top 5 suppliers of the Company
| No. | Supplier name | Purchase amount (yuan) | Proportion in total annual purchase amount |
| 1 | Hangzhou Lida Hardware Technology Co., Ltd. | 165,821,434.38 | 5.22% |
| 2 | Shaoxing Kaisen Kitchen and Bathroom Co., Ltd. | 161,618,221.58 | 5.09% |
| 3 | Jeamo Motor Co., Ltd. | 152,649,928.22 | 4.81% |
| 4 | Ma Steel (Jinhua) Steel Processing Co., Ltd. | 111,491,084.82 | 3.51% |
| 5 | Wuxi Huamei New Material Co., Ltd. | 109,564,363.60 | 3.45% |
| Total | -- | 701,145,032.60 | 22.08% |
Other information of major suppliers
□ Applicable √ Not applicable
3. Cost
Unit: yuan
| 2019 | 2018 | Year-on-year increase/decrease | Description of major changes | |
| Selling expenses | 1,928,259,172.35 | 1,909,856,779.45 | 0.96% | - |
| Management costs | 284,364,115.17 | 272,355,117.98 | 4.41% | - |
| Financial expenses | -83,410,491.25 | -101,340,531.42 | -17.69% | - |
| Research and development expenses | 299,469,126.54 | 293,427,244.80 | 2.06% | - |
4. R & D investment
√Applicable □ Not applicable
In 2019, the Company continued to increase R & D investment, with a total investment of 299 millionyuan, with R & D investment accounting for 3.86%, down 0.09 percentage points year on year. Thecompany now has a national technology center, a national laboratory and a national industrial designcenter. In addition, ROBAM set up California Innovation Research Institute and Shenzhen InnovationResearch Institute. The former focuses on collection of cutting-edge technology, the latter focuses onbasic research and application of new materials and new techniques. In terms of product development,for mature categories such as range hoods and gas hobs, the main development direction is theinnovation of core performance indicators and product forms; for non-open fire cooking appliances suchas steamers and steam oven-ovens, the Company focused on the user experience of Chinese cooking,developed a variety of multi-functional differentiated products; increased the investment in dishwashercategories, comprehensively upgraded from the form and performance indicators, and developed apowerful dishwasher customized for Chinese kitchens; for other categories, such as purification sink,integrated range hood, etc., it mainly focused on the development of differentiated indicators.R & D investment of the Company
| 2019 | 2018 | Proportion of change | |
| Number of R & D personnel (person) | 714 | 709 | 0.71% |
| Proportion of R & D personnel | 15.82% | 15.91% | -0.09% |
| R & D investment amount (yuan) | 299,469,126.54 | 293,427,244.80 | 2.06% |
| Proportion of R & D investment in operating revenue | 3.86% | 3.95% | -0.09% |
| Capitalized amount of R & D investment (yuan) | 0.00 | 0.00 | - |
| Proportion of capitalized R & D investment in R & D investment | 0.00% | 0.00% | - |
Reasons for significant changes in the proportion of total R & D investment amount in operating revenue compared withthe previous year
□ Applicable √ Not applicable
Reasons for the great changes of R & D investment capitalization rate and description of its rationality
□ Applicable √ Not applicable
5. Cash flow
Unit: yuan
| Item | 2019 | 2018 | Year-on-year increase/decrease |
| Subtotal cash inflows from operating activities | 8,178,723,903.78 | 8,692,141,265.90 | -5.91% |
| Subtotal cash outflows from operating activities | 6,623,502,976.88 | 7,183,180,954.61 | -7.79% |
| Net cash flow from operating activities | 1,555,220,926.90 | 1,508,960,311.29 | 3.07% |
| Subtotal cash inflows from investment activities | 4,021,202,772.82 | 3,030,193,836.98 | 32.70% |
| Subtotal cash outflows from investment activities | 2,965,663,320.83 | 4,213,697,627.81 | -29.62% |
| Net cash flow from investment activities | 1,055,539,451.99 | -1,183,503,790.83 | -189.19% |
| Subtotal cash outflows from financing activities | 759,219,240.00 | 711,857,630.25 | 6.65% |
| Net cash flow from financing activities | -759,219,240.00 | -711,857,630.25 | 6.65% |
| Net increase of cash and cash equivalents | 1,852,076,406.65 | -385,568,165.53 | 85.07% |
Description of main influencing factors of significant changes in relevant data on a year-on-year basis? Applicable Not applicableDuring the reporting period, the net cash flow from investment activities decreased by 189.19% compared with the sameperiod in previous year which was mainly caused by the decrease of the Company's purchase of financial products.Reasons for significant difference between the net cash flow from operating activities of the Company and the net profit ofthe current year in the reporting period
□ Applicable √ Not applicable
III. Non-main business analysis
□ Applicable √ Not applicable
IV. Analysis of assets and liabilities
1. Major changes in asset composition
Adjustment of relevant items in financial statements at the beginning of the implementation year as a result of firstimplementation of new financial instrument standards, new income standards and new release standards from 2019? Applicable Not applicable
Unit: yuan
| End of 2019 | End of 2018 | Proportion change | Description of major | |||
| Amount | Proportion | Amount | Proportion in | |||
| in total assets | total assets | changes | ||||
| Monetary capital | 4,054,121,726.23 | 38.06% | 2,196,706,808.35 | 23.23% | 14.83% | - |
| Accounts receivable | 725,630,901.28 | 6.81% | 446,773,135.47 | 4.73% | 2.08% | - |
| Inventory | 1,339,176,925.20 | 12.57% | 1,347,112,731.03 | 14.25% | -1.68% | - |
| Investment properties | 112,588.34 | 0.00% | 121,575.14 | 0.00% | 0.00% | - |
| Long-term equity investment | 4,168,338.79 | 0.04% | 2,617,851.16 | 0.03% | 0.01% | - |
| Fixed assets | 826,234,929.97 | 7.76% | 842,877,466.95 | 8.91% | -1.15% | - |
| Construction in progress | 272,211,720.62 | 2.56% | 184,440,655.49 | 1.95% | 0.61% | - |
2. Assets and liabilities measured with fair value
□ Applicable √ Not applicable
3. Limitation on the assets and rights as of the end of the reporting periodN/AV. Analysis of investment
1. Overall situation
√ Applicable ?Not applicable
| Investment amount in the reporting period (yuan) | Investment amount in the same period of previous year (yuan) | Amount of variation |
| 0.00 | 162,320,000 | -100% |
2. Significant equity investments acquired during the reporting period
□ Applicable √ Not applicable
3. Significant ongoing non-equity investments during the reporting period
□ Applicable √ Not applicable
4. Financial assets measured with fair value
□ Applicable √ Not applicable
5. Use of funds raised
□ Applicable √ Not applicable
No funds raised are used in the reporting period.VI. Sales of major assets and equities
1. Sales of major assets
□ Applicable √ Not applicable
The company did not sell major assets in the reporting period.
2. Sales of major equities
□ Applicable √ Not applicable
VII. Analysis of main holding and joint-stock companies
√Applicable □ Not applicable
Joint-stock companies that affect the net profits of the Company by more than 10% and main subsidiaries
Unit: yuan
| Company name | Company type | Main business | Registered capital | Total assets | Net assets | Operating income | Operating profit | Net profit |
| Hangzhou Mingqi Electric Co., Ltd. | Subsidiary | Production and sales of kitchen electric appliance products | 50,000,000 | 184,161,401.21 | 84,730,829.87 | 253,140,003.98 | 7,037,278.97 | 5,404,036.35 |
| Shanghai Robam Electric Appliance Sales Co., Ltd. | Subsidiary | Sales of kitchen electric appliance products | 5,000,000 | 60,133,985.15 | 10,165,939.00 | 328,236,670.34 | 5,537,917.79 | 897,237.08 |
| Beijing Robam Electric | Subsidiary | Sales of kitchen electric | 5,000,000 | 66,526,274.74 | 41,444,454.62 | 236,886,934.97 | 8,786,132.13 | 5,391,316.10 |
| Appliance Sales Co., Ltd. | appliance products | |||||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Subsidiary | Production and sales of integrated kitchen products | 32,653,061 | 315,656,414.04 | 231,076,577.81 | 229,610,991.10 | 53,715,920.57 | 49,858,521.98 |
Acquisition and disposal of subsidiaries during the reporting period
□ Applicable √ Not applicable
Description of main holding and joint-stock companiesVIII. Structured entities controlled by the Company
□ Applicable √ Not applicable
IX. Prospect of the Company's future development
1. Company development strategy (2020-2022)
Focus on cooking, focus on range hoods, expand the first category advantages, lead the secondcategory, and steadily promote the third category. Adhere to the spirit of hard-working viseentrepreneurship, take products and users as the core, create a competitive advantage of the enterprise.Continue to create a more "convenient, healthy and interesting" kitchen life for users, build a globalbrand and a century-old enterprise.I. Overall goal: build a global brand and a century-old enterprise.To be a world-class century-old leader of cooking innovation.II. Business goal: focus on cooking, focus on range hoods, expand the first category advantages, leadthe second category, and steadily promote the third category.The first category refers to the product group represented by range hoods. The second category refersto the electrified cooking product group represented by steamers. The third category refers to the waterkitchen appliance product group represented by dishwashers.III. Core work: take products and users as the core, create a competitive advantage of the enterprise,and continue to create a more "convenient, healthy and interesting" kitchen life for users.The core of products focus on the leading product technology; users refer to the consumers who
purchase and use kitchen products. At present, the kitchen appliance industry has entered the era ofstock game. With the acceleration of industry integration, products and user experience will becomemore and more important. Through technological innovation, expand the competitive advantages ofproducts, increase the market share driven by products, pay attention to the user's cooking process andcooking environment, take improving the user's cooking experience as the starting point, make theproducts and user experience the Company's competitive advantage, and continue to create a more"convenient, healthy and interesting" kitchen life for users.
2. Mission, vision and values of the Company
Mission: To render happiness of kitchen life for more families.Vision: To be a world-class century-old leader of cooking innovation.Values: Hard-working vise entrepreneurship.
3. In 2020, the Company's working policy is to "practice internal skills and go through the period, strivefor progress in stability and promote growth - seize the market, strengthen products", clarify its ownpositioning, strengthen the establishment of enabling organizations, pull through product lines, promoteefficient operation, precise marketing, improve efficiency and reduce cost, etc., and practice internalskills diligently and make up for shortcomings. The key point to seize the market is to fight four kinds ofbattles, namely, battle of position, uphill battle, battle of annihilation and protracted battle, to guard thehigh-end positioning, market position and bottom line of growth, and to continuously improve usersatisfaction. Strengthening products should focus on product research and development, product qualityand product promotion, in-depth cooking research, and promote product intelligence and integration tomeet customer needs and expectations.
4. Risk Factors
(1) Risk of real estate market fluctuation
The Company takes root in the kitchen and provides integrated solutions for built-in kitchen appliancesincluding range hoods, gas hobs, sterilizers, ovens, steamers, microwave ovens, dishwashers, waterpurifiers, integrated stoves, purification sinks, etc. Its demand comes from the kitchen decoration afterthe house purchase, which has certain attributes of "decoration" and "furniture". In addition, most of thedemand currently is from the new demand rather than the renewal demand, so its demand is greatlyaffected by the fluctuation of the real estate market. Although the Company has certain ability to resistfluctuations by virtue of its market leadership, the fluctuation of the real estate market will still have a
certain impact on the Company's operating performance.
(2) Risk of raw material price fluctuation
The Company's main raw materials are stainless steel, cold-rolled sheet, copper, glass, etc. whose pricefluctuation will directly affect the Company's product costs, thus affecting the Company's profitability. Ifthe price of the Company's main raw materials rises sharply, there will be some pressure on theCompany's operating performance.
(3) Risk of intensified market competition
In recent years, due to the decline of demand caused by real estate regulation, the continuousimprovement of industry concentration, the increasing investment of comprehensive brands in thekitchen appliance market and the strong participation of Internet brands, there is a risk of intensifiedmarket competition in the kitchen appliance industry, which will have a certain impact on the Company'sbusiness performance.
X. Reception, research, communication, interview and other activities
1. Registration form of reception, research, communication, interview and other activities duringthe reporting period
√Applicable □ Not applicable
| Reception time | Reception way | Type of received object | Basic information index of the survey |
| January 03, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on January 03, 2019 in cninfo |
| Friday, January 04, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on Friday, January 04, 2019 in cninfo |
| January 08, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on January 8-9, 2019 in cninfo |
| Friday, January 11, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on Friday, January 11, 2019 in cninfo |
| February 26, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on February 26-27, 2019 in cninfo |
| March 13, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on March 13-14, 2019 in cninfo |
| April 25, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on April 25-26, 2019 in cninfo |
| May 14, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on May 14-15, 2019 in cninfo |
| May 22, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on May 22-23, 2019 in cninfo |
| June 05, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on June 5-6, 2019 in cninfo |
| June 13, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on June 13-14, 2019 in cninfo |
| June 25, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on June 25, 2019 in cninfo |
| July 01, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on July 1-2, 2019 in cninfo |
| July 18, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on July 18-19, 2019 in cninfo |
| September 16, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on September 16-17, 2019 in cninfo |
| September 18, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on September 18-23, 2019 in cninfo |
| September 25, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on September 25-26, 2019 in cninfo |
| October 05, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on October 05, 2019 in cninfo |
| November 07, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on November 07, 2019 in cninfo |
| November 18, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on November 18, 2019 in cninfo |
| November 19, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on November 19, 2019 in cninfo |
| December 12, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on December 12, 2019 in cninfo |
| Friday, December 20, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on Friday, December 20, 2019 in cninfo |
| December 25, 2019 | Field survey | Organization | See the Robam Appliances: Record Chart of Investor Relation Activities on December 25, 2019 in cninfo |
Section 5 Important Matters
I. Common stock profit distribution and share capital increase from capital surplusFormulation, implementation and adjustment of common stock profit distribution policy, especially cash dividend policy,during the reporting period? Applicable Not applicable
| Description for cash dividend policy | |
| Does it meet the requirements of the Company’s articles of association and of the resolutions of shareholders’ meeting? | Yes |
| Is the dividend distribution standard and proportion specific and clear? | Yes |
| Are relevant decision-making procedures and mechanisms complete? | Yes |
| Have the independent directors performed their duties and fulfilled their due roles? | Yes |
| Do the minor shareholders have the chance to fully express their opinions and demands, and are their legal rights and interests fully protected? | Yes |
| Are the conditions and procedures normative and transparent in case of adjustments or changes of the cash dividend policy? | Yes |
Common stock dividend distribution program (plan) and share capital increase from capital surplus program (plan) in thepast 3 years (including this reporting period)
1. The Company's profit distribution program in 2017: based on its existing total stock issue of 949,032,825 shares, theCompany distributed cash dividends of 7.5 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to atotal of 711,774,618.75 yuan.
2. The Company's profit distribution plan in 2018: based on its existing total stock issue of 949,024,050 shares, theCompany distributed cash dividends of 8 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to atotal of 759,219,240 yuan.
2. The Company's profit distribution plan in 2019: based on its existing total stock issue of 949,024,050 shares, theCompany distributed cash dividends of 5 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to atotal of 474,512,025.00 yuan.Common stock cash dividends of the Company in the past 3 years (including this reporting period)
Unit: yuan
| Year of dividend | Amount of cash dividend (tax inclusive) | Net profits attributable to common stockholders of the listed company in the annual consolidated | Ratio of cash dividends to net profits attributable to common stockholders of the listed company in | Ratio of cash dividends in other forms to net profits attributable to common stockholders of the listed | Total amount of cash dividends (including other forms) | Ratio of total amount of cash dividends (including other forms) to net profits attributable to |
| statement of dividends | the consolidated statement | company in the consolidated statement | common stockholders of the listed company in the consolidated statement | |||
| 2019 | 474,512,025.00 | 1,589,814,847.80 | 29.85% | 474,512,025.00 | 29.85% | |
| 2018 | 759,219,240.00 | 1,473,579,665.62 | 51.52% | 759,219,240.00 | 51.52% | |
| 2017 | 711,774,618.75 | 1,461,213,518.63 | 48.71% | 711,774,618.75 | 48.71% |
The Company achieved profit within the reporting period and the parent company's attributable profit to commonstockholders was positive, but no common stock cash dividend distribution plan was proposed.
□ Applicable √ Not applicable
II. Profit distribution and share capital increase from capital surplus during thereporting period
√Applicable □ Not applicable
| Bonus shares per 10 shares (shares) | 0 |
| Dividend per 10 shares (yuan) (including tax) | 5 |
| Increase shares per 10 shares | 0 |
| Equity base of distribution plan (shares) | 949,024,050 |
| Amount of cash dividend (yuan) (including tax) | 474,512,025.00 |
| Amount of cash dividend in other forms (e.g. share repurchase) (yuan) | 0.00 |
| Amount of cash dividend (including other forms) (yuan) | 474,512,025.00 |
| Distributable profit (yuan) | 4,955,109,022.86 |
| Ratio of total amount of cash dividend (including other forms) to total amount of distributable profit | 100% |
| Cash dividend distribution in this period | |
| Should the Company be in a growing stage and have major capital expenditure arrangements, the cash dividend should account for a minimum of 20% of the profit distribution when the profit is distributed. | |
| Description for details of profit distribution or share capital increase from capital surplus plan | |
| According to the standard unqualified audit report issued by ShineWing Certified Public Accountants, the Company’s net profit attributable to the parent company owner in 2019 was RMB 1,553,740,923.33 yuan (number of parent company), plus the undistributed profit of RMB 4,160,587,339.53 yuan at the beginning of the year, minus the cash dividend of profit distribution of 2018, i.e., RMB 759,219,240.00 yuan, the Company's profit available to shareholders at the end of 2019 was RMB 4,955,109,022.86 yuan. Based on its existing total stock issue of 949,024,050 shares, the Company distributed cash dividends of 5 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to | |
III. Performance in fulfilling commitments
1. Commitments fulfilled within and not fulfilled by the end of the reporting period by theCompany’s actual controller, shareholders, related parties, acquirer and other commitmentparties
√Applicable □ Not applicable
a total of 474,512,025.00 yuan.Commitment
reason
| Commitment reason | Commitment party | Commitment type | Commitment content | Commitment time | Time limit for acceptance | Degree of performance |
| Commitment made at the time of IPO or refinancing | Directors, supervisors and senior management directly or indirectly holding shares of the Company | Commitment to restriction on sales of shares | After the expiry of the 36-month sales restriction period, the shares transferred each year during his/her tenure shall not exceed 25% of the total number of shares held directly or indirectly in the Company; the Company shares directly or indirectly held shall not be transferred within six months after the resignation | November 23, 2010 | Long-term | Strict performance |
| Hangzhou Robam Industrial Group Co., Ltd.; Ren Jianhua | Commitment on avoiding horizontal competition | 1. The Company/I and other enterprises under the control of the Company/me do not, and will not, directly or indirectly, engage in any activities that constitute horizontal competition with the existing and future business of Robam and its holding subsidiaries; 2. If any business opportunity obtained the Company/I and other enterprises under the control of the Company/me from any third party constitutes or may constitute substantial | November 23, 2010 | Long-term | Strict performance |
| competition with the business of Robam, the Company/I will immediately notify Robam and transfer such business opportunity to Robam; 3. The Company/I and other enterprises under the control of the Company/me commit not to provide technical information, process flow, marketing channels or other trade secrets to other companies, enterprises, organizations or individuals whose business constitutes competition with the business of Robam. | ||||||
| Other commitments made to minor shareholders of the Company | Company | Dividend | The cumulative profits distributed in cash for three consecutive years shall not be less than 40% of the annual average distributable profits realized in the three years. | April 10, 2018 | Three years | Strict performance |
| Whether the commitment is fulfilled on time | Yes | |||||
2. In case the Company’s asset or project saw earning expectation, and the reporting period isstill covered by the term of the earning expectation, the Company shall make a statement aboutthe asset or project fulfilling the original expectation and the reasons thereof.
□ Applicable √ Not applicable
IV. Non-operating occupation of funds of listed companies by controllingshareholders and their related parties
□ Applicable √ Not applicable
No non-operating occupation of funds of listed companies by controlling shareholders and their related parties during thereporting period.
V. Statement of the board of directors, the board of supervisors and independentdirectors (if any) on the "non-standard audit report" of the accounting firm during thereporting period
□ Applicable √ Not applicable
VI. Explanation of changes in accounting policy, accounting estimates andaccounting methods when compared to the financial statements of the previousfiscal year
√Applicable □ Not applicable
On August 26, 2019, the 12th meeting of the 4th Board of Directors and the 11st meeting of the 4th Board of Supervisorsreviewed and adopted the Proposal on Implementing New Accounting Standards and Changing Relevant AccountingPolicies. As the Ministry of Finance released the Notice on Revising and Issuing the Format of Financial Statements forOrdinary Enterprises in 2019 (CK [2019] No.6) in April 2019, the Company decided to start applying the changes of theaccounting policies as per the timeline stipulated by the Ministry of Finance. The updates of the accounting policies wouldrefer to only the presentation and adjustment of financial statements, and have no substantial impact on the Company’stotal assets, net assets, operating income and net profit.VII. Explanation of rectification of major accounting error in the reporting periodwhich needs to be tracked and restated
□ Applicable √ Not applicable
No rectification of major accounting error in the reporting period which needs to be tracked and restated.VIII. Explanation of changes in the scope of combined financial statements whencompared with financial statements of the previous fiscal year
□ Applicable √ Not applicable
No changes in the scope of combined financial statements in the reporting period.
IX. Appointment of and dismissal of accounting firms
Accounting firm currently appointed
| Name of Chinese accounting firm | Shinewing Certified Public Accountants (special general partnership) |
| Remuneration (10,000 yuan) | 83 |
| Term of audit services | 1 |
| CPAs | Lei Yongxin, Gao Zhiying |
| Term of auditing services of CPAs | 1 |
Has the accounting firm been changed within the reporting period?
√Yes □ No
Has the accounting firm been changed within the auditing period?
□Yes √No
Has the approval procedures been performed while changing the accounting firm?
√Yes □ No
Detailed description for changing of accounting firmThe Company convened the 13th meeting of the 4th Board of Directors and the 12th meeting of the 4th Board ofSupervisors on October 28, 2019, and reviewed and approved the Proposal on Changing the Accounting Firm. And thefirst extraordinary general meeting of shareholders of 2019 was held on November 14, 2019 for deliberation and approval.Taking into account its development and cooperation needs, the Company planned to invite ShineWing Certified PublicAccountants (special general partnership) to do audit of internal control for the fiscal year of 2019, employment term beingone year.Employment of internal control audit accounting firm, financial advisor or sponsor
□ Applicable √ Not applicable
X. IPO suspension or termination of listing confronted upon disclosure of the annualreport
□ Applicable √ Not applicable
XI. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization of the Company during the reporting period.XII. Major litigation and arbitration matters
□ Applicable √ Not applicable
No major litigation or arbitration matters of the Company during the reporting period.XIII. Punishment and rectification
□ Applicable √ Not applicable
No punishment or rectification of the Company during the reporting period.
XIV. Credit conditions of the Company, its controlling shareholders and actualcontrollers
□ Applicable √ Not applicable
XV. Implementation of the Company's equity incentive plan, employee stockownership plan or other employee incentive measures
√Applicable □ Not applicable
1. Implementation of the initial restricted stock incentive plan
(1) The Company’s first extraordinary general meeting of shareholders in 2015 on January 13, 2015 reviewed andadopted the Proposal on the Initial Restricted Stock Incentive Plan (Draft) of Hangzhou Robam Appliances Co., Ltd. andits Summary and the Proposal on Requesting the General Meeting of Shareholders of Hangzhou Robam Appliances Co.,Ltd. to Authorize the Board of Directors to Handle the Issues Related to the Company’s Restricted Stock Incentive Plan.
(2) On January 21, 2015, the Company’s 15th meeting of the third Board of Directors and the 4th meeting of the thirdBoard of Supervisors reviewed and adopted the Proposal on Granting Restricted Stocks to Incentive Objects.
(3) On February 13, 2015, the Company completes the registration on first granting of restricted stocks involved in theInitial Restricted Stock Incentive Plan (Draft) of Hangzhou Robam Appliances Co., Ltd.
(4) On January 4, 2016, the Company’s 12th meeting of the third Board of Directors and the 10th meeting of the thirdBoard of Supervisors reviewed and adopted the Proposal on Adjusting the Number of Restricted Stocks Reserved and theProposal on Issues Related to Granting Restricted Stocks Reserved to Incentive Objects.
(5) On January 22, 2016, the Company’s 13th meeting of the third Board of Directors and the 11th meeting of the thirdBoard of Supervisors reviewed and adopted the Proposal on First Granting of Unlocking of the Restricted Stocks in FirstUnlocking Period in Restricted Stock Incentive Plan.
(6) On February 05, 2016, the Company completes the registration on granting of restricted stocks reserved involved inthe Initial Restricted Stock Incentive Plan (Draft) of Hangzhou Robam Appliances Co., Ltd.
(7) On April 7, 2016, the Company’s 14th meeting of the third Board of Directors and the 12th meeting of the third Board ofSupervisors reviewed and adopted the Proposal on the Cancellation of Partial Incentive Stock Repurchase in InitialRestricted Share Incentive Plan.
(8) On January 23, 2017, the Company’s 19th meeting of the third Board of Directors and the 16th meeting of the thirdBoard of Supervisors reviewed and adopted the Proposal on the Cancellation of Partial Incentive Stock Repurchase in
Initial Restricted Stock Incentive Plan, the Proposal on First Granting of Unlocking in Second Unlocking Period inRestricted Stock Incentive Plan and the Proposal on Reserved Granting of Unlocking in First Unlocking Period inRestricted Stock Incentive Plan.
(9) On February 6, 2018, the Company’s 4th meeting of the fourth Board of Directors and the 4th meeting of the fourthBoard of Supervisors reviewed and adopted the Proposal on First Granting of Unlocking in Third Unlocking Period inRestricted Stock Incentive Plan and the Proposal on Reserved Granting of Unlocking in Second Unlocking Period inRestricted Stock Incentive Plan.
(10) On January 21, 2019, the Company’s 9th meeting of the fourth Board of Directors and the 9th meeting of the fourthBoard of Supervisors reviewed and adopted the Proposal on Reserved Granting of Unlocking in Third Unlocking Period inRestricted Stock Incentive Plan.
2. Implementation of the employee stock ownership plan in 2018
(1) On January 11, 2018, the 3rd meeting of the 4th Board of Directors of the Company was held to review and approvethe documents titled About the Company's 2018 Employee Stock Ownership Plan (Draft) and the Summary and Proposalon Authorizing the Board of Directors to Handle Matters Related to the Company's Stock Ownership Plan. The former wasalso reviewed and approved in the 3rd meeting of the 4th Board of Supervisors of the Company the same day.
(2) On February 2, 2018, the Company’s first extraordinary general meeting of shareholders in 2018 was held to reviewand approve About the Company's 2018 Employee Stock Ownership Plan (Draft) and the Summary and Proposal onAuthorizing the Board of Directors to Handle Matters Related to the Company's Stock Ownership Plan.
(3) On May 4, 2018, purchases of the Company's employee stock ownership plan in 2018 had been completed,purchasing price up to 35.94 yuan/share, a total of 5,443,300 shares purchased, accounting for 0.57% of the total stockissue.XVI. Major related transactions
1. Related transactions related to daily operation
| Related transaction party | Relationship | Related transaction type | Related transaction content | Related transaction pricing principle | Related transaction price | Related transaction amount (10,000 yuan) | Ratio to amount of similar transactions | Approved transaction quota (10,000 yuan) | Is the approved transaction quota exceeded | Method of settlement for related transaction | Market price of similar transaction |
| available | |||||||||||
| Hangzhou Yuhang Matt Spray Painting Factory | Controlled by the sister of the actual controller | Labor receiving | Paint processing | Market price | Market price | 1,395.59 | No | Bank transfer | 1,395.59 | ||
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Controlled by the same parent company | Product purchase | Material | Market price | Market price | 361.62 | No | Bank transfer | 361.62 | ||
| Hangzhou Amblem Kitchen Ware Co., Ltd. | Controlled by the same parent company | Labor receiving | Display booth, cupboard | Market price | Market price | 199.32 | No | Bank transfer | 199.32 | ||
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Controlled by the same parent company | Product purchase | Fuel | Market price | Market price | 100.8 | No | Bank transfer | 100.8 | ||
| Garden Hotel Hangzhou | Greatly influenced by the parent company | Labor receiving | Service | Market price | Market price | 1.65 | No | Bank transfer | 1.65 | ||
| Hangzhou Nbond Nonwoven Co., Ltd. | Controlled by the same parent company | Product purchase | Material | Market price | Market price | 3.98 | No | Bank transfer | 3.98 | ||
| De Dietrich Trade (Shanghai) Co., Ltd. | Cooperative enterprise | Product purchase | Material | Market price | Market price | 0.45 | No | Bank transfer | 0.45 | ||
| Shaoxing Kinde Electric Appliance Co., Ltd. | Other shareholders of subsidiaries controlled | Selling goods | Material | Market price | Market price | 2,453.21 | No | Bank transfer | 2,453.21 |
√Applicable □ Not applicable
2. Related transactions arising from the acquisition or sale of assets or equity
□ Applicable √ Not applicable
No Related transactions arising from the acquisition or sale of assets or equity of the Company during the reportingperiod.
3. Related transactions of joint foreign investment
□ Applicable √ Not applicable
No related transactions of joint foreign investment of the Company during the reporting period.
4. Related claims and debts
□ Applicable √ Not applicable
No related claims and debts of the Company during the reporting period.
5. Other major related transactions
□ Applicable √ Not applicable
No other major related transactions of the Company during the reporting period.
XVII. Major contracts and their performance
1. Trusteeship, contracting and lease
(1) Trusteeship
No trusteeship of the Company during the reporting period.
| by the Company | |||||||||||
| Hangzhou Amblem Kitchen Ware Co., Ltd. | Controlled by the same parent company | Selling goods | Material | Market price | Market price | 1,085.53 | No | Bank transfer | 1,085.53 | ||
| De Dietrich Trade (Shanghai) Co., Ltd. | Cooperative enterprise | Selling goods | Material | Market price | Market price | 6.88 | No | Bank transfer | 6.88 | ||
| Total | -- | -- | 5,609.03 | -- | 0 | -- | -- | -- | |||
(2) Contracting
No contracting of the Company during the reporting period.
(3) Lease
√Applicable □ Not applicable
Lease description
| Name of lessor | Name of lessee | Type of leased assets | Lease fee recognized in the current year | Lease fee recognized in the previous year |
| Hangzhou Robam Appliances Co., Ltd. | Hangzhou Robam Industrial Group Co., Ltd. | House | 28,800.00 | 28,800.00 |
| Hangzhou Robam Industrial Group Co., Ltd. | Hangzhou Robam Appliances Co., Ltd. | House | 550,024.57 | 550,024.57 |
| Shaoxing Kinde, Co,Ltd | Shengzhou Kinde Intelligent | House | 128,831.1 | 0.00 |
| Total | — | — | 707,655.75 | 578,824.57 |
Project bringing the profits or losses more than 10% of the total profits of the Company in the reporting period to theCompany
□ Applicable √ Not applicable
No lease project bringing the profits or losses more than 10% of the total profits of the Company in the reporting period tothe Company during the reporting period.
2. Major guarantee
□ Applicable √ Not applicable
No guarantee of the Company during the reporting period.
3. Entrusted cash asset management
(1) Entrusted financing
√Applicable □ Not applicable
Entrusted financing during the reporting period
Unit: 10,000 yuan
| Specific type | Source of funds for entrusted financing | Amount incurred in entrusted financing | Outstanding balance | Overdue amount not recovered |
| Bank financial products | Owned fund | 200,000 | 110,000 | 0 |
| Total | 200,000 | 110,000 | ||
Specific circumstance of high-risk entrusted financing with significant single amount or with low security, poor liquidity andnot break-even
√Applicable □ Not applicable
Unit: 10,000 yuan
| Name of entrusted organization (entrustee) | Type of entrusted organization (entrustee) | Product type | Amount | Source of funds | Start date | End date | Capital investment direction | Way to confirm remuneration | Reference annualized yield rate | Expected earnings (if any) | Realized gains and losses during the reporting period | Actual recovery of gains and losses during the reporting period | Have legal procedures been gone through? | Are there any other entrusted financing plans to be expected in the future |
| Bank of Shanghai Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | June 28, 2018 | January 03, 2019 | Bank financing | Agreement of contract | 4.85% | 251.14 | Recovered | Yes | Yes | |
| Bank of Nanjing Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | July 18, 2018 | Friday, January 18, 2019 | Bank financing | Agreement of contract | 4.90% | 501.56 | Recovered | Yes | Yes | |
| China Industrial Bank Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | February 07, 2018 | Friday, February 01, 2019 | Bank financing | Agreement of contract | 4.70% | 902.91 | Recovered | Yes | Yes | |
| Shanghai Pudong Development Bank Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | August 08, 2018 | February 13, 2019 | Bank financing | Agreement of contract | 4.70% | 241.53 | Recovered | Yes | Yes | |
| Agricultural Bank of China Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | August 08, 2018 | Friday, February 01, 2019 | Bank financing | Agreement of contract | 4.80% or 4.85% | 232.53 | Recovered | Yes | Yes | |
| Bank of Jiangsu Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | August 14, 2018 | February 14, 2019 | Bank financing | Agreement of contract | 4.80% | 240 | Recovered | Yes | Yes | |
| Shanghai Pudong Development Bank Yuhang Branch | Bank | Structured deposit | 30,000 | Owned fund | December 29, 2018 | Friday, March 29, 2019 | Bank financing | Agreement of contract | 4.50% | 337.5 | Recovered | Yes | Yes | |
| Agricultural Bank of China Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | Friday, July 20, 2018 | April 10, 2019 | Bank financing | Agreement of contract | 4.90% | 708.82 | Recovered | Yes | Yes | |
| Bank of Shanghai Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | Friday, September 28, 2018 | April 11, 2019 | Bank financing | Agreement of contract | 4.50% | 239.18 | Recovered | Yes | Yes | |
| China | Bank | Structure | 10,000 | Owne | Friday, | Friday, | Bank | Agreement | 4.30% | 214.41 | Recovere | Yes | Yes |
| Industrial Bank Yuhang Branch | d deposit | d fund | October 12, 2018 | April 12, 2019 | financing | of contract | d | |||||||
| Bank of Nanjing Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | January 29, 2019 | July 29, 2019 | Bank financing | Agreement of contract | 4.50% | 226.42 | Recovered | Yes | Yes | |
| Agricultural Bank of China Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | January 30, 2019 | Friday, August 02, 2019 | Bank financing | Agreement of contract | 4.30% | 216.77 | Recovered | Yes | Yes | |
| Bank of Shanghai Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | August 23, 2018 | August 22, 2019 | Bank financing | Agreement of contract | 4.70% | 937.42 | Recovered | Yes | Yes | |
| Bank of Agriculture and Commerce Yuhang Branch | Bank | Structured deposit | 13,000 | Owned fund | August 23, 2018 | Friday, August 30, 2019 | Bank financing | Agreement of contract | 5.20% | 668.59 | Recovered | Yes | Yes | |
| Zhejiang Chouzhou Commercial Bank Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | March 06, 2019 | Friday, September 06, 2019 | Bank financing | Agreement of contract | 4.50% | 226.85 | Recovered | Yes | Yes | |
| Bank of Agriculture and Commerce Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | Friday, October 12, 2018 | Friday, October 11, 2019 | Bank financing | Agreement of contract | 5.00% | 498.63 | Recovered | Yes | Yes | |
| Bank of Nanjing Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | October 15, 2018 | October 14, 2019 | Bank financing | Agreement of contract | 4.80% | 970.83 | Recovered | Yes | Yes | |
| China Merchants Bank Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | May 06, 2019 | November 05, 2019 | Bank financing | Agreement of contract | 4.30% | 431.18 | Recovered | Yes | Yes | |
| Bank of Shanghai Yuhang Branch | Bank | Structured deposit | 30,000 | Owned fund | December 18, 2018 | December 17, 2019 | Bank financing | Agreement of contract | 4.80% | 1,436.05 | Recovered | Yes | Yes | |
| China Industrial Bank Yuhang Branch | Bank | Structured deposit | 40,000 | Owned fund | April 01, 2019 | Friday, December 20, 2019 | Bank financing | Agreement of contract | 4.40% | 1,296.99 | Recovered | Yes | Yes | |
| Agricultural Bank of China Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | April 01, 2019 | Friday, February 07, 2020 | Bank financing | Agreement of contract | 3.85% or 3.90% | Undue | Yes | Yes | ||
| Bank of Shanghai Yuhang | Bank | Structured deposit | 10,000 | Owned fund | August 28, 2019 | February 27, 2020 | Bank financing | Agreement of contract | 1.00%-3.90% | Undue | Yes | Yes |
| Branch | ||||||||||||||
| Bank of Shanghai Yuhang Branch | Bank | Structured deposit | 10,000 | Owned fund | September 05, 2019 | Friday, March 06, 2020 | Bank financing | Agreement of contract | 1.00%-3.90% | Undue | Yes | Yes | ||
| China Merchants Bank Yuhang Branch | Bank | Structured deposit | 20,000 | Owned fund | October 16, 2019 | Friday, April 24, 2020 | Bank financing | Agreement of contract | 1.55%-4.20% | Undue | Yes | Yes | ||
| China Merchants Bank Yuhang Branch | Bank | Structured deposit | 30,000 | Owned fund | November 11, 2019 | April 27, 2020 | Bank financing | Agreement of contract | 1.35%-4.2% | Undue | Yes | Yes | ||
| Bank of Shanghai Yuhang Branch | Bank | Structured deposit | 30,000 | Owned fund | December 26, 2019 | June 29, 2020 | Bank financing | Agreement of contract | 4.00% | Undue | Yes | Yes | ||
| Total | 443,000 | -- | -- | -- | -- | -- | -- | 107,793,100 | -- | -- | -- | |||
The entrusted financing is expected not to recover the principal or has other circumstances that may cause impairment
□ Applicable √ Not applicable
(2) Entrusted loans
□ Applicable √ Not applicable
No entrusted loans of the Company during the reporting period.
4. Other major contracts
□ Applicable √ Not applicable
No other major contracts of the Company during the reporting period.
XVIII. Social responsibility
1. Social responsibility fulfillment
The ROBAM CSR Report 2019 was released on April 28, 2020 at cninfo (http://www.cninfo.com.cn)
2. Implementation of social responsibility for targeted poverty alleviation
(1) Targeted poverty alleviation planning
Over the past years since its establishment, the Company, deeply aware of the obligations and responsibilities of being asocial citizen, has been always taking "to be a respectable enterprise" as its target and the public welfare as an importantpart of the Company's strategic planning.In 2015, ROBAM Appliances created a named endowment fund amounting up to 20 million yuan in Yuhang Charity
Federation, to extensively carry out public welfare projects associated with poverty reduction, major disease relief,donation to education, etc. Hangzhou Yuhang ROBAM Charity Foundation is a non-public foundation initiated byHangzhou Robam Appliances Co., Ltd., approved by Zhejiang Provincial Department of Civil Affairs and under thesupervision of Yuhang District Bureau of Civil Affairs. Adhering to the tenet of "helping the needy, repaying the society andimproving the cooking environment of Chinese family", the Foundation has been committed to rural revitalization, medicaland health care, education development, targeted poverty alleviation and other fields since its establishment. And toeffectively integrate the charitable resources and maximize the philanthropy, the Company joins hands with the agencycompanies and its employees give back to the society with practical actions and create a promising future together.
(2) Annual summary on targeted poverty alleviation
1. Focus on kitchen and promote rural revitalization
In 2019, as a member of the first city-level support group, ROBAM continued to pair up with Fengshuling town, Chun 'ancounty, for poverty alleviation with an investment of no less than 1 million yuan in 5 years. Besides, the Company offeredtargeted poverty alleviation to 10 impoverished villagers in the town, helping them improve their kitchen settings as well asproduction and living conditions. And as a responsible enterprise, ROBAM provided assistance to nearly ten impoverishedcounties and districts, including Ning county, Diebu county, Qin'an county, Lingtai county in Gansu province, and Enshiand Badong county in Hubei, to help win the battle against poverty.
2. Cherish charity with full participation
ROBAM Appliances always attaches importance to cultivating the charity consciousness and social responsibility of theemployees, to arouse their love and enthusiasm, trying to create a strong atmosphere for everyone to participate in thecharity with charity in mind, so as to expand the scope of poverty alleviation, increase the intensity of poverty relief with aconcerted effort, contributing to building a harmonious society. At the initiative of the Company, all Party members, cadres,employees and agency companies across the state responded positively and devoted themselves to the public welfarecharities, practicing their social responsibility, trying to make greater contributions to the centennial vision of the Company.In 2019 only, all Party members, cadres, employees and agency companies across the state donated a total of 2.092million yuan.In February 2019, the Company held the first "Heart of ROBAM" charity awards ceremony, highly praising 14 agencycompanies making outstanding contributions to the public welfare.
3. Focus on actual effects and pass love and positive energy
The Foundation of the Company uses every donation efficiently and accurately, trying to deliver each penny to those who
need it most. First of all, it carries out a series of education donations, to contribute to the development of educationthrough such projects as college aim program, beautiful campus construction and construction of school libraries. Second,it launches a series of poverty alleviation and relief activities. Actively responding to the initiative of Yuhang District Partycommittee and District Government to "send warmth and love", the Foundation donates 1 million yuan to the districtCharity Federation every year. It carries out "Grand Love" major disease relief, helping more than 10 patients with majordiseases to get through the difficulties. Third, it conducts a series of public benefit activities. By carrying out such socialwelfare activities as "approaching the nursing home", caring for people with intellectual disabilities, and high-temperaturecondolence (first-line traffic police, firefighters), the Company passes on love and positive energy.In the future, the Company will continue to strive to be a prestigious enterprise respected by the society, fulfill its socialresponsibilities, and make new and greater contributions to the development of China's charity cause.
(3) Targeted poverty alleviation effect
(4) Follow-up targeted poverty alleviation programs
3. Environmental protection related condition
Whether the listed company and its subsidiaries are key pollutant discharging units announced by environmentalprotection authoritiesNot applicable
XIX. Description of other important events
□ Applicable √ Not applicable
No other important events to be described during the reporting period.XX. Major events of subsidiaries
□ Applicable √ Not applicable
Section 6 Changes in Shares and ShareholdersI. Change in shares
1. Change in shares
Unit: share
| Before this change | Increase/decrease (+, -) | After this change | |||||||
| Quantity | Proportion | New issue of shares | Share donation | Share capital increase from reserved funds | Other | Subtotal | Quantity | Proportion | |
| I. Restricted shares | 14,497,669 | 1.53% | -374,400 | -374,400 | 14,123,269 | 1.49% | |||
| 3. Other domestic holdings | 14,497,669 | 1.53% | -374,400 | -374,400 | 14,123,269 | 1.49% | |||
| Domestic natural person shareholding | 14,497,669 | 1.53% | -374,400 | -374,400 | 14,123,269 | 1.49% | |||
| II. Unrestricted shares | 934,535,156 | 98.47% | 365,625 | 365,625 | 934,900,781 | 98.51% | |||
| 1. RMB common share | 934,535,156 | 98.47% | 365,625 | 365,625 | 934,900,781 | 98.51% | |||
| III. Total amount of shares | 949,032,825 | 100.00% | -8,775 | -8,775 | 949,024,050 | 100.00% | |||
Causes for change in shares
√Applicable □ Not applicable
(1) On January 8, 2019, the Company completed the repurchase of canceled restricted stocks and repurchased 8,775restricted stocks of the incentive object. The total capital stocks decreased from 949,032,825 to 949,024,050.
(2) On February 18, 2019, the Company reserved to grant unlocking of the restricted stock incentive plan in the third
unlocking period and the number of restricted stocks that could be unlocked and listed was 365,625, accounting for
0.0385% of the Company's total capital stock.
Approval of changes in shares
√Applicable □ Not applicable
(1) On February 6, 2018, the Company’s 4th meeting of the fourth Board of Directors and the 4th meeting of the fourthBoard of Supervisors reviewed and adopted the Proposal on First Granting of Unlocking in Third Unlocking Period inRestricted Stock Incentive Plan and the Proposal on Reserved Granting of Unlocking in Second Unlocking Period inRestricted Stock Incentive Plan.
(2) On August 22, 2018, the Company’s 7th meeting of the fourth Board of Directors and the 7th meeting of the fourthBoard of Supervisors reviewed and adopted the Proposal on the Partial Repurchase of Canceled Initial Restricted Stocksin Initial Restricted Share Incentive Plan.
(3) On January 21, 2019, the Company’s 9th meeting of the fourth Board of Directors and the 9th meeting of the fourthBoard of Supervisors reviewed and adopted the Proposal on Reserved Granting of Unlocking in Third Unlocking Period inRestricted Stock Incentive Plan.Transfer of share changes
□ Applicable √ Not applicable
Implementation progress of share repurchase
□ Applicable √ Not applicable
Implementation progress of reducing repurchased shares by centralized competitive bidding
□ Applicable √ Not applicable
Influence of share changes on the basic EPS, diluted EPS, net assets per share attributable to common shareholders ofthe Company and other financial indexes in the most recent year and the most recent period
□ Applicable √ Not applicable
Other information the Company deems necessary or required by the securities regulatory authorities to disclose
□ Applicable √ Not applicable
2. Changes in restricted shares
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Securities issuance (excluding preferred shares) during the reporting period
□ Applicable √ Not applicable
2. Description of changes in the total number of shares, shareholder structure, asset and liabilitystructure of the Company
□ Applicable √ Not applicable
3. Existing internal employee shares
□ Applicable √ Not applicable
III. Shareholders and actual controllers
1. Number and shareholding of the Company's shareholders
Unit: share
| Total number of common shareholders at the end of the reporting period | 48,122 | Total number of common shareholders at the end of the previous month before the disclosure date of the annual report | 55,021 | Total number of preferred shareholders with voting rights restored at the end of the reporting period (if any) (see Note 8) | 0 | Total number of preferred shareholders with voting rights restored at the end of the previous month before the disclosure date of the annual report (if any) (see Note 8) | 0 | |||||||
| Shareholders holding more than 5% shares or top 10 shareholders | ||||||||||||||
| Shareholder's name | Shareholder nature | Shareholding ratio | Number of shares held at the end of the reporting period | Increase or decrease during the reporting period | Number of shares held with limited sales conditions | Number of shares held with unlimited sales conditions | Pledge or freeze | |||||||
| Status of shares | Quantity | |||||||||||||
| Hangzhou Robam Industrial Group Co., Ltd. | Domestic non-state legal person | 49.68% | 471,510,000 | 471,510,000 | ||||||||||
| Hong Kong Securities Clearing Co. Ltd. | Overseas legal person | 14.23% | 135,075,397 | 34,551,613 | 135,075,397 | |||||||||
| Shen Guoying | Domestic natural person | 1.29% | 12,240,000 | 12,240,000 | ||||||||||
| China Construction Bank Co., Ltd. - Anxin Value Selected Stock Securities Investment Fund | Other | 1.16% | 11,047,319 | 4,795,887 | 11,047,319 | |||||||||
| Hangzhou Jinchuang | Domestic non-state | 1.00% | 9,451,985 | 9,451,985 | ||||||||||
| Investment Co., Ltd. | legal person | |||||||
| Aberdeen Standard Investments (Asia) Limited - Aberdeen Global - China A-Shares Fund | Overseas legal person | 0.90% | 8,569,450 | 4,389,783 | 8,569,450 | |||
| Shenzhen Guoshi Capital Management Co., Ltd. - Guoshi Capital - Robam Agent Holding Stage 2 Structured Private Equity Fund | Other | 0.88% | 8,311,165 | 8,311,165 | ||||
| Hangzhou Yinchuang Investment Co., Ltd. | Domestic non-state legal person | 0.67% | 6,318,000 | -702,000 | 6,318,000 | |||
| Ren Jianhua | Domestic natural person | 0.62% | 5,923,150 | 4,442,362 | 1,480,788 | |||
| Central Huijin Investment Ltd. | State legal person | 0.60% | 5,685,810 | 5,685,810 | ||||
| Description of the above-mentioned shareholder association or concerted action | The actual controller of the Company’s controlling shareholder Hangzhou Robam Industrial Group Co., Ltd. and the shareholder Hangzhou Jinchuang Investment Co., Ltd. is Mr. Ren Jianhua, and the natural person shareholder Shen Guoying is the wife of Ren Jianhua. The above shareholders have the possibility of acting in unison. | |||||||
| Shareholding of top 10 shareholders with unlimited sales conditions | |||
| Shareholder's name | Number of shares with unlimited sales conditions held at the end of the reporting period | Share type | |
| Share type | Quantity | ||
| Hangzhou Robam Industrial Group Co., Ltd. | 471,510,000 | RMB common share | 471,510,000 |
| Hong Kong Securities Clearing Co. Ltd. | 135,075,397 | RMB common share | 135,075,397 |
| Shen Guoying | 12,240,000 | RMB common share | 12,240,000 |
| China Construction Bank Co., Ltd. - Anxin Value | 11,047,319 | RMB common | 11,047,319 |
| Selected Stock Securities Investment Fund | share | ||
| Hangzhou Jinchuang Investment Co., Ltd. | 9,451,985 | RMB common share | 9,451,985 |
| Aberdeen Standard Investments (Asia) Limited - Aberdeen Global - China A-Shares Fund | 8,569,450 | RMB common share | 8,569,450 |
| Shenzhen Guoshi Capital Management Co., Ltd. - Guoshi Capital - Robam Agent Holding Stage 2 Structured Private Equity Fund | 8,311,165 | RMB common share | 8,311,165 |
| Hangzhou Yinchuang Investment Co., Ltd. | 6,318,000 | RMB common share | 6,318,000 |
| Central Huijin Investment Ltd. | 5,685,810 | RMB common share | 5,685,810 |
| Shenzhen Guoshi Capital Management Co., Ltd. - Guoshi Capital - Robam Win-win No.1 Private Equity Fund | 5,443,324 | RMB common share | 5,443,324 |
| Description of the association or concerted action between top 10 public shareholders with unlimited sales conditions, and between top 10 public shareholders with unlimited sales conditions and top 10 shareholders | The actual controller of the Company’s controlling shareholder Hangzhou Robam Industrial Group Co., Ltd. and the shareholder Hangzhou Jinchuang Investment Co., Ltd. is Mr. Ren Jianhua, and the natural person shareholder Shen Guoying is the wife of Ren Jianhua. The above shareholders have the possibility of acting in unison. | ||
Whether the Company’s top 10 common shareholders and op 10 common shareholders with unlimited sales conditionsagreed on a repurchase transaction during the reporting period
□Yes √No
The Company’s top 10 common shareholders and op 10 common shareholders with unlimited sales conditions did notagree on a repurchase transaction during the reporting period
2. Controlling shareholders of the Company
Nature of controlling shareholder: natural person holdingType of controlling shareholder: legal person
| Controlling shareholder's name | Legal Representative / Head of Unit | Date of establishment | Organization code | Main business |
| Hangzhou Robam Industrial Group Co., Ltd. | Ren Jianhua | March 22, 1995 | 14384025-0 | Industrial investment, import and export of goods |
| Equity of other domestic and foreign listed companies controlled and | The controlling shareholder directly holds 55.76% of the equity of Hangzhou Nbond Nonwoven Co., Ltd. (603238), which is its controlling shareholder. | |||
Change of controlling shareholders during the reporting period
□ Applicable √ Not applicable
No change in controlling shareholders during the reporting period.
3. Actual controller of the Company and person acting in concert
Nature of actual controller: domestic natural personType of actual controller: natural person
participated by controllingshareholders during thereporting period
Actual controller’s name
| Actual controller’s name | Relationship with actual controller | Nationality | Whether to obtain the right of residence in other countries or regions |
| Ren Jianhua | Self | China | No |
| Main occupations and positions | Chairman and secretary of the party committee of Robam Group, chairman of Robam Appliances, chairman of Hangzhou Nbond Nonwoven Co., Ltd., and chairman of Hangzhou Amblem Kitchen Ware Co., Ltd. | ||
| Domestic and foreign listed companies that have held shares in the past 10 years | - | ||
Changes in actual controller during the reporting period
□ Applicable √ Not applicable
No change in actual controller during the reporting period.Block diagram of property right and control relationship between the Company and actual controller
The actual controller controls the Company through trust or other asset managementmethods
□ Applicable √ Not applicable
Ren JianhuaRobamGroup
| Robam Group | Jinchuang Investment |
4. Other legal person shareholders holding more than 10%
□ Applicable √ Not applicable
5. Restricted share reduction of controlling shareholders, actual controller, reorganizers andother commitment subjects
□ Applicable √ Not applicable
Section 7 Preferred Shares
□ Applicable √ Not applicable
No preferred shares of the Company during the reporting period.
Section 8 Convertible Bonds
□ Applicable √ Not applicable
No convertible bonds of the Company during the reporting period.
Section 9 Directors, Supervisors, Senior Management and
EmployeesI. Equity changes of directors, supervisors and senior management
| Name | Position | Status of service | Gender | Age | Start date of tenure | End date of tenure | Number of shares held at the beginning of the period (shares) | Number of shares held at the end of the period (shares) |
| Ren Jianhua | Chairman | Incumbent | Male | 63 | Friday, August 18, 2017 | August 17, 2020 | 5,923,150 | 5,923,150 |
| Ren Fujia | Deputy chairman, general manager | Incumbent | Male | 36 | Friday, August 18, 2017 | August 17, 2020 | 2,800,075 | 2,800,075 |
| Zhao Jihong | Director | Incumbent | Male | 57 | Friday, August 18, 2017 | August 17, 2020 | 1,690,065 | 1,690,065 |
| Ren Luozhong | Director | Incumbent | Male | 57 | Friday, August 18, 2017 | August 17, 2020 | 1,690,062 | 1,690,062 |
| Wang Gang | Director, deputy general manager, secretary to the board of directors | Incumbent | Male | 44 | Friday, August 18, 2017 | August 17, 2020 | 576,750 | 576,750 |
| Shen Guoliang | Director | Incumbent | Male | 54 | Friday, August 18, 2017 | August 17, 2020 | 1,524,264 | 1,524,264 |
| Zhang Guangjie | Independent director | Incumbent | Male | 56 | Friday, August 18, 2017 | August 17, 2020 | ||
| Dong Jing | Independent director | Incumbent | Female | 44 | Friday, August 18, 2017 | August 17, 2020 | ||
| Ma Guoxin | Independent director | Incumbent | Male | 66 | Friday, August 18, 2017 | August 17, 2020 |
| Zhang Linyong | Chairman of the board of supervisors | Incumbent | Male | 54 | Friday, August 18, 2017 | August 17, 2020 | 1,112,315 | 1,112,315 |
| Tang Genquan | Employee supervisor | Incumbent | Male | 59 | Friday, August 18, 2017 | August 17, 2020 | 1,112,312 | 1,112,312 |
| Zhang Songnian | Supervisor | Incumbent | Male | 53 | Friday, August 18, 2017 | August 17, 2020 | 1,112,312 | 1,112,312 |
| Zhang Huifen | Employee supervisor | Incumbent | Female | 41 | Friday, August 18, 2017 | August 17, 2020 | ||
| Shen Yueming | Supervisor | Incumbent | Male | 60 | Friday, August 18, 2017 | August 17, 2020 | 53,875 | 53,875 |
| Xia Zhiming | Deputy general manager | Incumbent | Male | 44 | Friday, August 18, 2017 | August 17, 2020 | 411,950 | 411,950 |
| He Yadong | Deputy general manager | Incumbent | Male | 45 | Friday, August 18, 2017 | August 17, 2020 | 411,950 | 411,950 |
| Zhang Guofu | Chief financial officer | Incumbent | Male | 50 | Friday, August 18, 2017 | August 17, 2020 | 411,950 | 411,950 |
| Total | -- | -- | -- | -- | -- | -- | 18,831,030 | 18,831,030 |
II. Change of directors, supervisors and senior management
□ Applicable √ Not applicable
III. Service status
Professional background, main work experience and main responsibilities currently in the Company of currentdirectors, supervisors and senior management of the Company
Mr. Ren Jianhua, Han nationality, born in August 1956, Chinese, without permanent residency abroad; juniorhigh school education, member of Communist Party of China, economist. He began to work in 1978 andsuccessively served as the supply and marketing section chief and factory director of Yuhang HongxingHardware Factory, the chairman, general manager and Secretary of the Party branch of Hangzhou RobamIndustrial Group Co., Ltd., and the chairman and general manager of Hangzhou Robam Home Appliances &Kitchen Sanitary Co., Ltd. He has won the titles of national model worker and outstanding member ofCommunist Party of Zhejiang Province, and was elected as the deputy to the 8th and 10th National People's
Congress of Zhejiang Province, deputy to the 11th National People's Congress of Hangzhou City, the Partyrepresentative, deputy to the 12th National People's Congress of Hangzhou City, and the 12th FengyunZhejiang Merchants. At present, he is the chairman of Hangzhou Nbond Nonwoven Co., Ltd., HangzhouGuoguang Touring Commodity Co., Ltd, Hangzhou Amblem Kitchen Ware Co., Ltd., Hangzhou RobamAppliances Co., Ltd., Hangzhou Robam Industrial Group Co., Ltd., the executive director and generalmanager of Hangzhou Mingqi Electric Co., Ltd., the executive director and general manager of HangzhouRobam Fuchuang Investment Management Co., Ltd., the deputy chairman of Garden Hotel Hangzhou, thedirector of Zhejiang Hangzhou Yuhang Rural Commercial Bank Company Limited, Hangzhou DongmingForest Park Co., Ltd., Zhejiang CFMOTO Power Co., Ltd, the executive director of Hangzhou Bonyee DailyNecessity Technology Co., Ltd., the executive director and general manager of Hangzhou JinchuangInvestment Co., Ltd., the executive partner of Hangzhou Jinnuochang Investment Management Partnership(Limited Partnership), deputy to the 13th Hangzhou Municipal People's Congress.Mr. Ren Fujia, Han nationality, born in January 1983, Chinese, without permanent residency abroad; bachelordegree. He used to be the product manager of marketing department and the deputy general manager of R &D center of Hangzhou Robam Industrial Group Co., Ltd., the deputy general manager of Hangzhou RobamHome Appliances & Kitchen Sanitary Co., Ltd.; now he is the director of Hangzhou Nbond Nonwoven Co.,Ltd., the deputy chairman and general manager of Hangzhou Robam Appliances Co., Ltd., the director ofHangzhou Amblem Kitchen Ware Co., Ltd., the director of Dize Home Appliances Trading (Shanghai) Co.,Ltd., and the deputy chairman of De Dietrich Trade (Shanghai) Co., Ltd.Mr. Zhao Jihong, Han nationality, born in December 1962, Chinese, without permanent residency abroad;master degree, senior economist; successively served as the chairman and general manager of HubeiHuangshi Jinye Group Co., Ltd, the deputy general manager and general manager of the marketing center ofRobam Group, the deputy general manager and general manager of the marketing center of Robam HomeAppliances, and the deputy general manager of the Company; now he is the director of the Company; and thechairman of Shengzhou Jindi Intelligent Kitchen Appliances Co., Ltd. He has successively won the titles ofnational outstanding entrepreneur, outstanding Hangzhou merchant in the World, "top 10 influential figures inChina's kitchen and bathroom industry", "top 10 personalities in China's home appliance industry", and twicewon the Mondale · world economic man achievement award and was selected into the dictionary of Chineseexperts and celebrities.Mr. Ren Luozhong, Han nationality, born in August 1962, Chinese, without permanent residency abroad;
EMBA, assistant economist. He began to work in 1982 and successively served as the operation director ofYuhang Hongxing Hardware Factory, the deputy general manager, general manager of the marketing center,general manager of the technology center and director of the first production department of Robam Group,the director and deputy general manager of Robam Home Appliances, and the deputy general manager of theCompany. At present, he is the director of the Company.Mr. Wang Gang, Han nationality, born in October 1975, Chinese, without permanent residency abroad;master degree, EMBA of China Europe International Business School, member of Communist Party of China,certified public accountant, senior economist. He began to work in 1997 and successively served as aninspector of Haining Local Taxation Bureau of Zhejiang Province, the R & D director of Shanghai RealizeInvestment Consulting Co., Ltd., the secretary of the board of directors, director of human resources, generalmanager assistant of Shanghai Hailong Software Co., Ltd, and the secretary of the board of directors ofHangzhou Robam Home Appliances & Kitchen Sanitary Co., Ltd. At present, he is the director of HangzhouNbond Nonwoven Co., Ltd., the director, deputy general manager, secretary of the board of directors andinvestment director of Hangzhou Robam Appliances Co., Ltd., the director of Dize Home Appliances Trading(Shanghai) Co., Ltd., the director of Hangzhou Fortune Gas Cryogenic Group Co.,Ltd., the director of DeDietrich Trade (Shanghai) Co., Ltd., the director of Hangzhou Guoguang Touring Commodity Co., Ltd, thesupervisor of Hangzhou Robam Fuchuang Investment Management Co., Ltd., the director of ShengzhouKinde Intelligent Kitchen Electric Co., Ltd., the supervisor of Shanghai MXCHIP Information Technology Co.,Ltd., the director of Ningbo Qingfeng Investment Co., Ltd, the independent director of Zhejiang KaiyuanProperty Management Co. Ltd.Mr. Shen Guoliang, Han nationality, born in November 1965, Chinese, without permanent residency abroad;high school education. He began to work in 1982 and successively served as the chief of the transportationsection of Yuhang Hongxing Hardware Factory, the director, chief financial officer and the deputy generalmanager of the marketing center of Robam Group, the director of Robam Home Appliances, and thechairman of the board of supervisors of the Company. At present, he is the director of the Company and thedirector of Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd.Mr. Zhang Guangjie, Han nationality, born in September 1963, Chinese, without permanent residency abroad;master degree, member of Communist Party of China, the doctoral supervisor in Law School of FudanUniversity. He began to work in 1987 and successively served as a lawyer of Fudan Law Firm, a lawyer ofShanghai Silema Law Firm, a lawyer of Shanghai Siweilema Law Firm, a director of Fudan Yuanda
Technology Co., Ltd., a researcher of the intellectual property center of Fudan University, head of the TrainingDepartment of Hong Kong China Law School, the deputy dean of Law School of Fudan University, theindependent director of Hangzhou Nbond Nonwoven Co., Ltd., Huafon Microfibre (Shanghai) Co.,Ltd. andZhejiang Int’l Group Co.,Ltd. At present, he is the executive director of China Jurisprudence ResearchAssociation, the independent director of Wuhu Conch Profiles and Science Co.,Ltd. and the Company.Ms. Dong Jing, Han nationality, born in November 1975, Chinese, without permanent residency abroad; PhDdegree, member of Communist Party of China, assistant to the dean of Business School and professor inShanghai University of Finance and Economics, certified public accountant. In 2003, she worked as INSEADvisiting scholar in France, visiting scholar of the Wharton School of the University of Pennsylvania in theUnited States. At present, she is the director of Institute of Comprehensive Economy of Pudong New Area,the independent director of Shanghai Tunnel Engineering Co.,Ltd., Shanghai Xinmei Real Estate Co.,Ltd.,Shanghai Juneyao Airlines Co., Ltd and the Company.Mr. Ma Guoxin, Han nationality, born in September 1953, Chinese, without permanent residency abroad;member of Communist Party of China, bachelor degree. He began to work in 1970 and successively servedas the office director of the Company (Party committee), deputy manager (and secretary) of the salescompany of Hangzhou Medical Equipment Factory (later changed into Hangzhou Refrigerator GeneralFactory, Hangzhou Xiling Electrical Appliance Group Co., Ltd.), the director of household appliance industrymanagement department and deputy secretary general of Zhejiang Household Appliance Association. Atpresent, he is the secretary general and vice president of Zhejiang Household Appliance Association; theindependent director of AUPU Home Style Corporation Limited, Qijing Machinery Co., Ltd. and the Company.
2. Resume of current supervisors
Mr. Zhang Linyong, Han nationality, born in August 1965, Chinese, without permanent residency abroad;high school education, member of Communist Party of China, assistant economist. He began to work in1984 and successively served as the office director of Yuhang Hongxing Hardware Factory, the generalmanager of Hangzhou Huafa Electric Appliance Co., Ltd., the director and director of the engineeringdepartment of Robam Group, and the director of Robam Home Appliances. At present, he is thechairman of the board of supervisors of the Company.Mr. Tang Genquan, Han nationality, born in October 1960, Chinese, without permanent residency abroad;college degree, engineer. He began to work in 1979 and successively served as the mould workshop
director and technical director of Yuhang Hongxing Hardware Factory, the deputy general manager oftechnology, general manager of production quality and director of the third production department ofRobam Group, the director of Robam Home Appliances. In 1993-1994 and 2005-2006, he was awardedas the outstanding scientific and technological worker of Hangzhou. In 2004, he was selected into the"new century talent project 139 youth talent cultivation candidate list", applied for 1 national inventionpatent, 7 utility model patents and 10 design patents. He has been employed as a member of China dailyhardware industry expert committee since 1996 and the deputy secretary general of fifth China dailyhardware industry expert committee since 2006. At present, he is the employee representativesupervisor of the Company.Mr. Zhang Songnian, Han nationality, born in September 1966, Chinese, without permanent residencyabroad; high school education. He began to work in 1983 and successively served as the productionsection chief of Yuhang Hongxing Hardware Factory, the deputy general manager of Hangzhou HuafaElectric Appliance Co., Ltd., the director, deputy director of production department, director of the secondproduction department and general manager of product R & D center of Robam Group, and thesupervisor of Robam Home Appliances. At present, he is the supervisor of the Company.Ms. Zhang Huifen, Han nationality, born in October 1977, Chinese, without permanent residency abroad;college degree, junior economist, junior accountant. She began to work in 1997 and successively servedas the employee of Hangzhou Gaobo Electronic Co., Ltd., the employee of punching machine thirdworkshop, member of audit department of marketing center and office clerk of financial center of RobamGroup. At present, he is the employee representative supervisor of the Company.Mr. Shen Yueming, Han nationality, born in November 1959, Chinese, without permanent residencyabroad; high school education. He began to work in 1978 and successively served as the factory directorof Tingzhi Food Factory of Yuhang Supply and Marketing Cooperative, the production section director ofHangzhou Huafa Electric Appliance Co., Ltd., and the general manager of Beijing Robam ElectricAppliance Sales Co., Ltd. At present, he is the supervisor of the Company.
3. Resume of current senior management
Mr. Ren Fujia is the general manager of the Company; Mr. Wang Gang is the deputy general manager ofthe Company. Please refer to the resume of the directors of the Company for the introduction.
Mr. Xia Zhiming, Han nationality, born in May 1975, Chinese, without permanent residency abroad;
college degree. He began to work in 1996 and successively served as the production section chief ofQiaori Electric Products Factory, the manufacturing director of Foxconn Technology Co., Ltd. and theproduction director of the Company's production center. At present, he is the deputy general manager ofthe Company.Mr. He Yadong, Han nationality, born in August 1974, Chinese, without permanent residency abroad;bachelor degree,senior economist. He began to work in 2000 and successively served as the marketingsection chief, director of marketing department and deputy general manager of marketing center ofRobam Group, the assistant to general manager of Robam Home Appliances, and director of theCompany. At present, he is the deputy general manager of the Company.Mr. Zhang Guofu, Han nationality, born in December 1969, Chinese, without permanent residencyabroad; bachelor degree. He began to work in 1990 and successively served as the capital section chief,director of financial center of Hangzhou Robam Industrial Group Co., Ltd., and financial chief ofHangzhou Robam Home Appliances & Kitchen Sanitary Co., Ltd. At present, he is the chairman of theboard of supervisors of Hangzhou Nbond Nonwoven Co., Ltd., the chief financial officer of HangzhouRobam Appliances Co., Ltd., the director of Hangzhou Mingqi Electric Co., Ltd. and Shengzhou KindeIntelligent Kitchen Electric Co., Ltd., and the director of De Dietrich Trade (Shanghai) Co., Ltd.
Service status in the shareholder unit
√Applicable □ Not applicable
| Name of staff | Shareholder unit name | Position held in shareholder unit | Start date of tenure | End date of tenure | Whether to receive remuneration or allowance in the shareholder unit |
| Ren Jianhua | Hangzhou Robam Industrial Group Co., Ltd. | Chairman | February 25, 1995 | No | |
| Hangzhou Jinchuang Investment Co., Ltd. | Executive director | March 24, 2008 | No | ||
| Ren Luozhong | Hangzhou Robam Industrial Group Co., Ltd. | Deputy chairman | December 24, 2014 | No | |
| Zhao Jihong | Hangzhou Robam Industrial Group Co., Ltd. | Director, general manager | December 24, 2014 | No |
| Shen Guoliang | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Zhang Linyong | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Tang Genquan | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Zhang Songnian | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Description of service status in the shareholder unit | N/A | ||||
Service status in other unit
√Applicable □ Not applicable
| Name of staff | Other unit name | Position held in other unit | Start date of tenure | End date of tenure | Whether to receive remuneration or allowance in other unit |
| Ren Jianhua | Hangzhou Amblem Kitchen Ware Co., Ltd. | Chairman | No | ||
| Garden Hotel Hangzhou | Deputy chairman | No | |||
| Hangzhou Dongming Forest Park Co., Ltd. | Director | No | |||
| Hangzhou Nbond Nonwoven Co., Ltd. | Chairman | No | |||
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Chairman | No | |||
| Zhejiang Hangzhou Yuhang Rural Commercial Bank Company Limited | Director | No | |||
| Hangzhou Jinnuochang Investment Management Partnership (Limited Partnership) | Executive partner | No | |||
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Executive director | No | |||
| Zhejiang CFMOTO Power Co., Ltd | Director | No | |||
| Hangzhou Mingqi Electric Co., Ltd. | Executive director and general manager | No | |||
| Ren Fujia | De Dietrich Trade (Shanghai) Co., Ltd. | Deputy chairman | No | ||
| Hangzhou Amblem Kitchen Ware Co., Ltd. | Director | No |
| Hangzhou Nbond Nonwoven Co., Ltd. | Director | No | |||
| Zhao Jihong | Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Chairman | No | ||
| uTransHub Technologies Co., Ltd. | Director | No | |||
| China Household Electrical Appliances Association | Vice president | No | |||
| Ren Luozhong | Hangzhou Amblem Kitchen Ware Co., Ltd. | Director | No | ||
| Shen Guoliang | Hangzhou Amblem Kitchen Ware Co., Ltd. | Supervisor | No | ||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Director | No | |||
| Zhang Guangjie | Shanghai Fudan University | Teacher | Yes | ||
| Wuhu Conch Profiles and Science Co.,Ltd. | Independent director | Yes | |||
| Dong Jing | Shanghai University of Finance and Economics | Teacher | Yes | ||
| Shanghai Tunnel Engineering Co.,Ltd. | Independent director | Yes | |||
| Shanghai Xinmei Real Estate Co.,Ltd. | Independent director | Yes | |||
| Shanghai Juneyao Airlines Co., Ltd | Independent director | Yes | |||
| Ma Guoxin | Zhejiang Household Appliances Association | Secretary general, vice president | Yes | ||
| AUPU Home Style Corporation Limited | Independent director | Yes | |||
| Qijing Machinery Co., Ltd. | Independent director | Yes | |||
| Wang Gang | Hangzhou Nbond Nonwoven Co., Ltd. | Director | No | ||
| Hangzhou Robam Fuchuang Investment Management Co., Ltd. | Supervisor | No | |||
| Shanghai MXCHIP Information Technology Co., Ltd. | Supervisor | No | |||
| Hangzhou Fortune Gas Cryogenic Group Co.,Ltd. | Director | No | |||
| Ningbo Qingfeng Investment Co., Ltd | Director | No | |||
| De Dietrich Trade (Shanghai) Co., Ltd. | Director | No | |||
| Hangzhou Yujing Investment Management | Chairman | No |
| Co., Ltd. | |||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Director | No | |||
| Hangzhou Guoguang Touring Commodity Co., Ltd | Director | No | |||
| Zhejiang Kaiyuan Property Management Co. Ltd. | Independent director | Yes | |||
| Zhang Guofu | De Dietrich Trade (Shanghai) Co., Ltd. | Director | No | ||
| Hangzhou Mingqi Electric Co., Ltd. | Supervisor | No | |||
| Hangzhou Nbond Nonwoven Co., Ltd. | Chairman of the board of supervisors | No | |||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Director | No | |||
| Description of service status in other unit | N/A | ||||
Punishment of current directors, supervisors and senior management of the Company and those who left during thereporting period by securities regulators in recent three years
□ Applicable √ Not applicable
IV. Remuneration of Directors, Supervisors and Senior ManagementDecision making procedures, determination basis and actual payment of remuneration of directors, supervisors andsenior managementThe Company has established a sound performance appraisal system and salary system for senior management, whosework performance is directly linked to their income. The remuneration and appraisal committee of the board of directors isresponsible for the year-end assessment of the working ability, performance of duties, completion of responsibilityobjectives, etc. of the senior management, and preparing the remuneration plan and submitting it to the board of directorsof the Company for approval. The remuneration of directors, supervisors and senior management shall be paid on time.
Remuneration of directors, supervisors and senior management during the reporting period
Unit: yuan
| Name | Position | Gender | Age | Status of service | Total pretax remuneration received from the Company | Whether to get remuneration from related parties of the Company |
| Ren Jianhua | Chairman | Male | 63 | Incumbent | 872,300 | No |
| Ren Fujia | Deputy chairman, general manager | Male | 36 | Incumbent | 776,430 | No |
| Zhao Jihong | Director | Male | 57 | Incumbent | 844,300 | No |
| Ren Luozhong | Director | Male | 57 | Incumbent | 816,300 | No |
| Wang Gang | Director, deputy general manager, secretary to the board of directors | Male | 44 | Incumbent | 778,018 | No |
| Shen Guoliang | Director | Male | 54 | Incumbent | 732,300 | No |
| Zhang Guangjie | Independent director | Male | 56 | Incumbent | 95,238 | No |
| Dong Jing | Independent director | Female | 44 | Incumbent | 95,238 | No |
| Ma Guoxin | Independent director | Male | 66 | Incumbent | 95,238 | No |
| Zhang Linyong | Chairman of the board of supervisors | Male | 54 | Incumbent | 676,300 | No |
| Tang Genquan | Employee supervisor | Male | 59 | Incumbent | 710,720 | No |
| Zhang Songnian | Supervisor | Male | 53 | Incumbent | 676,300 | No |
| Zhang Huifen | Employee supervisor | Female | 41 | Incumbent | 118,586 | No |
| Shen Yueming | Supervisor | Male | 60 | Incumbent | 284,500 | No |
| Xia Zhiming | Deputy general manager | Male | 44 | Incumbent | 714,950 | No |
| He Yadong | Deputy general manager | Male | 45 | Incumbent | 829,702 | No |
| Zhang Guofu | Chief financial officer | Male | 50 | Incumbent | 707,340 | No |
| Total | -- | -- | -- | -- | 9,823,762 | -- |
Equity incentive granted to directors and senior management of the Company during the reporting period
□ Applicable √ Not applicable
V. Company Employees
1. Number of employees, professional composition and education background
| Number of employees in the parent company (person) | 2,722 |
| Number of employees in main subsidiaries (person) | 1,781 |
| Total number of employees (person) | 4,512 |
| Total number of employees receiving salary in the current period (person) | 4,535 |
| Number of retired employees whose expenses need to be borne by the parent company and major subsidiaries (person) | 32 |
| Professional composition | |
| Professional composition categories | Number of professionals (person) |
| Production personnel | 1,297 |
| Sales personnel | 1,691 |
| Technical personnel | 714 |
| Financial personnel | 138 |
| Administrative personnel | 312 |
| Logistical personnel | 360 |
| Total | 4,512 |
| Education background | |
| Education background categories | Number (person) |
| Bachelor degree or above | 1,026 |
| College | 1,060 |
| Other | 2,426 |
| Total | 4,512 |
2. Pay policy
The company has formulated "Salary Management Standards" and "Performance ManagementStandards", and established a salary management system based on the post value and centered on thecompetency and performance evaluation of employees, according to the salary status of the regionalmarket and industry.
3. Training plan
In 2019, the Company carried out various trainings, carried out projects such as Lemon, Blue Whale,Sunflower, Ivy League and other projects as well as the Elite Program, and extensively carried out thepublicity and implementation of corporate culture map in agencies all over the country, with a very highdegree of participation. As the Company's own mobile learning platform, Chestnut School played an important role inthe achievement transformation of the development course of internal trainer, and the Company's employees' participationin learning has been greatly improved. A series of activities such as the vice platform and super open class enrich thevision of employees and improves their abilities.
4. Labor outsourcing
□ Applicable √ Not applicable
Section 10 Corporate GovernanceI. Basic State of Corporate Governance
In the reporting period, the Company constantly improved the corporate governance structure,established and improved internal management and control systems, and continued to carry out in-depthcorporate governance activities in strict accordance with the Company law, Securities Law, GovernanceGuidelines for Listed Companies, Rules for Stock Listing of Shenzhen Stock Exchange and relevantlaws and regulations of China Securities Regulatory Commission to further regulate the Companyoperation and improve the corporate government level. By the end of the reporting period, the actualsituation of corporate governance conformed to the normative documents on listed corporategovernance issued by China Securities Regulatory Commission.During the reporting period, the Company operated in strict accordance with national laws andregulations, Rules for Stock Listing of Shenzhen Stock Exchange and Guidelines on the StandardizedOperation of Listed Companies on the SME Board, and performed its obligations of informationdisclosure in a timely, complete, true, accurate and fair manner. The Company has not received therelevant documents of administrative supervision measures taken by the regulatory authorities.
(1) Shareholders and Shareholders’ Meeting
In strict accordance with the Rules of the Shareholders’ Meeting of Listed Companies and the Rules ofProcedure of the Shareholders' Meeting, the Company shall convene the shareholders’ meeting toensure that all shareholders, especially minority shareholders, enjoy equal status and fully exercise theirrights.
(2) Company and Controlling Shareholders
The Company has independent business and operational independence and is independent from thecontrolling shareholders in business, personnel, assets, institutions and finance. The Company's boardof directors, the board of supervisors and internal organize operate independently. The controllingshareholders of the Company can strictly regulate their own behaviors, without directly or indirectlyintervening in the Company's decision-making and business activities beyond the shareholders’meeting.
(3) Directors and Board of Directors
The Company elects its directors in strict accordance with the recruiting procedures stipulated in theArticles of Association; all the directors of the Company can carry out their work in accordance with theRules of Procedure of the Board of Directors and Guidelines on the Behaviors of Directors of ListedCompanies on the SME Board, attend the board of directors and shareholders' meetings earnestly,actively participate in the training of relevant knowledge, and be familiar with relevant laws andregulations.
(4) Supervisors and Board of Supervisors
The Company shall appoint supervisors in strict accordance with the relevant provisions of the Companylaw and articles of association, and the number and composition of the board of supervisors shall meetthe requirements of laws and regulations. In accordance with the requirements of the Rules of Procedureof the Board of Supervisors, the Company's supervisors can earnestly perform their duties, effectivelysupervise the Company's major issues, related party transactions, financial condition, and theperformance of directors and managers, and express independent opinions.
(5) Performance Evaluation and Incentive and Restraint MechanismsThe Company is gradually establishing a fair and transparent performance evaluation standard andincentive and restraint mechanism for directors, supervisors and managers. The appointment of theCompany's managers is open and transparent and conforms to the provisions of laws and regulations.
(6) Information Disclosure and Transparency
The Company carries out information disclosure and investor relations management under the boardsecretary responsibility system; the Company performs the information disclosure procedure in strictaccordance with the Measures for the Administration of Information Disclosure and discloses theinformation on the designated information disclosure media such as Securities Times, China SecuritiesJournal, Securities Daily and cninfo in a true, accurate, complete and timely manner according to law;meanwhile, according to the requirements of the Measures for the Investor Relations Management, theCompany standardizes investor reception procedures, receives visits and inquiries from shareholders,and ensures that all shareholders have equal access to the Company information.
(7) Stakeholder
The Company fully respects and safeguards the legitimate rights and interests of relevant stakeholders,realizes the coordination and balance of interests of the society, shareholders, the Company andemployees, and jointly promotes the sustainable and steady development of the Company.
(8) Internal Audit System
The Company has established an internal audit system and set up an internal audit department. Theboard of directors has appointed the person in charge of internal audit to effectively control theCompany's daily operation and management, internal control system and major issues of the Company.There is no significant difference between the actual situation of corporate governance and thenormative documents on listed corporate governance issued by China Securities RegulatoryCommission.II. Independence of Company from its controlling shareholders in terms of business,personnel, assets, institutions and financeThe Company operates in strict accordance with the Company Law and Articles of Association,
establishes and improves the corporate governance structure, is completely separated from thecontrolling shareholders in terms of business, personnel, assets, institutions and finance, and hasindependent and complete business and independent operation capability.III. Horizontal competition
□ Applicable √ Not applicable
IV. Information about the annual general meeting of shareholders and extraordinarygeneral meeting of shareholders held during the reporting period
1. General meeting of shareholders during the reporting period
| Meeting session | Meeting type | Investor participation proportion | Convening date | Date of disclosure | Disclosure index |
| Annual general meeting of shareholders in 2018 | Annual general meeting of shareholders | 61.68% | May 16, 2019 | Friday, May 17, 2019 | cninfo Announcement of Resolutions of 2018 Annual General Meeting of Shareholders (Announcement No.: 2019-025) |
| First extraordinary general meeting of shareholders in 2019 | Extraordinary general meeting of shareholders | 61.35% | November 14, 2019 | Friday, November 15, 2019 | cninfo Announcement of Resolutions of 2019 First Extraordinary General Meeting of Shareholders (Announcement No.: 2019-046) |
2. The preferred shareholders with voting rights restored request an extraordinary generalmeeting of shareholders
□ Applicable √ Not applicable
V. Performance of duties by independent directors during the reporting period
1. Attendance of board of directors and shareholders' meeting by independent directors
| Attendance of board of directors and shareholders' meeting by independent directors | |||||||
| Name of | Number of | Number of | Number of | Number of | Number of | Whether | Number of |
| independent director | board meetings to be attended during this reporting period | board meetings attended on site | board meetings attended by correspondence | board meetings delegated to attend | board meetings absent | not to personally attend the board meeting for two consecutive times | shareholders' meetings attended |
| Zhang Guangjie | 5 | 1 | 4 | No | 0 | ||
| Dong Jing | 5 | 1 | 4 | No | 0 | ||
| Ma Guoxin | 5 | 4 | 1 | No | 1 |
Description on failure to personally attend the board meeting for two consecutive times
2. Objections made by independent directors on relevant matters
Whether the independent directors make objections on relevant matters of the Company
□Yes √No
The independent directors don’t make objections on relevant matters of the Company in the reporting period.
3. Other description on the performance of duties by the independent directorsWhether relevant suggestions of the independent directors on the Company are adopted
√Yes □ No
Description on adoption or non-adoption of relevant suggestions of the independent directors on the CompanyDuring the reporting period, the independent directors of the Company performed their duties in strictaccordance with relevant laws, regulations and the Articles of Association, attended the board meetingheld during the reporting period, carefully deliberated various bills, objectively expressed their views, andmade independent and fair judgments with their professional knowledge.VI. Performance of duties by special committees under the board of directors duringthe reporting periodIn 2019, the board strategy committee held several meetings: strategic theory-discussing meeting,strategic seminar, strategy and performance communication meeting, etc., effectively fulfilling theresponsibilities of the strategy committee.In 2019, the audit committee held several meetings to review the Company's regular reports and internalaudit work reports and supervise the improvement and implementation of the internal control system,communicated with the certified public accountants of the annual audit on the audit arrangement andprogress and the problems found in the audit process and effectively performed the duties of the auditcommittee.In 2019, the remuneration and appraisal committee held a meeting to review and approve theremuneration of the Company's directors and senior managers, effectively fulfilling the responsibilities of
the remuneration and appraisal committee.In 2019, the nominations committee actively performed its duties and seriously examined the tenure andperformance of the Company's directors and senior managers.VII. Work of board of supervisors
Whether the board of supervisors find any risk of the Company in the supervision activities during the reporting period
□Yes √No
The board of supervisors has no objection to the supervisory matters during the reporting period.VIII. Evaluation and incentive of senior managersThe Company has established a sound performance appraisal system and salary system for seniormanagement, whose work performance is directly linked to their income. The remuneration andappraisal committee of the board of directors is responsible for the year-end assessment of the workingability, performance of duties, completion of responsibility objectives, etc. of the senior management,and preparing the remuneration plan and submitting it to the board of directors of the Company forapproval.
IX. Internal control evaluation report
1. Details of major internal control defects discovered during the reporting period
□Yes √No
2. Internal control self-evaluation report
| Full disclosure date of internal control self-evaluation report | April 28, 2020 | |
| Index of full disclosure of internal control evaluation report | cninfo | |
| Proportion of the total assets of the unit included in the evaluation scope to the total assets of the consolidated financial statement of the Company | 100.00% | |
| Proportion of operating income of the unit included in the evaluation scope to the operating income of the consolidated financial statement of the Company | 100.00% | |
| Defect identification standard | ||
| Category | Financial report | Non-financial report |
| Qualitative standard | Signs of major defects in the financial report include: 1) Corrupt practice of directors, supervisors and senior management; 2) Misstatement correction of material errors in financial reports that have been announced by the Company; 3) Material misstatement in the current financial report, which is not found by the internal control in the process of operation; 4) Ineffective control and supervision of the Company’s external and internal financial reports by the audit committee and audit department. Signs of important defects in the financial report include: 1) Failure to select and apply accounting policies in accordance with GAAP; 2) Failure to establish anti-fraud procedures and controls; 3) Failure to establish or implement corresponding control mechanism for accounting for irregular or special transactions without corresponding compensating control; 4) One or more defects in the control of the final financial reporting process and no reasonable assurance that the financial statements will achieve the objective of authenticity and completeness. Common defects refer to control defects other than the major defects and important defects mentioned above. | 1) The defects in non-financial reports are mainly determined according to the influence of the defects on the business process effectiveness and the possibility of occurrence; 2) The defects with low possibility that will reduce the work efficiency or effect, or increase the uncertainty of the effect, or make it deviate from the expected goal are common defects; 3) The defects with high possibility that will significantly reduce the work efficiency or effect, or significantly increase the uncertainty of the effect, or make it significantly deviate from the expected goal are important defects; 4) The defects with high possibility that will seriously reduce the work efficiency or effect, or seriously increase the uncertainty of the effect, or make it seriously deviate from the expected goal are major defects. |
| Quantitation standard | The quantitative standard takes the operating income and the total assets as the measurement index. 1) The internal control defects that may cause losses or whose losses are related to the income statement are | Common defect: direct property loss < RMB 5 million; Important defect: RMB 5 million < direct property loss < RMB 20 million; Major defect: direct property loss |
| measured on the basis of operating income: Common defect: misstatement amount < 1% of operating income; Important defect: 1% of operating income 《 misstatement amount < 2% of operating income; Major defect: misstatement amount > 2% of operating income 2) The internal control defects that may cause losses or whose losses are related to the assets management are measured on the basis of total assets: Common defect: misstatement amount < 0.5% of total assets; Important defect: 0.5% of total assets < misstatement amount < 1% of total assets; Major defect: misstatement amount ＞1% of total assets | ＞RMB 20 million. | |
| Number of major defects in financial reports | 0 | |
| Number of major defects in non-financial reports | 0 | |
| Number of important defects in financial reports | 0 | |
| Number of important defects in non-financial reports | 0 | |
Section 11: Corporate Bonds
Whether the Company has bonds publicly issued and listed on the stock exchange that have not expired or expired butnot paid in full on the date of approval of the annual reportNo
Section 12: Financial ReportI. Audit report
| Type of audit opinion | Standard unqualified opinion |
| Date of signing of audit report | April 27, 2020 |
| Name of audit institution | Shinewing Certified Public Accountants (special general partnership) |
| Audit Report No. | XYZH/2020BJA80124 |
| Name of Certified Public Accountant | Lei Yongxin, Gao Zhiying |
Audit report
XYZH/2020BJA80124
To all shareholders of Hangzhou Robam Appliances Co., Ltd.:
Audit opinion
We have audited the accompanying financial statements of Hangzhou Robam Appliances Co., Ltd. (hereinafter referred toas Robam), including the consolidated balance sheet and the balance sheet of parent company as of December 31, 2019,consolidated income statement and income statement of parent company, consolidated cash flow statement and cashflow statement of parent company, consolidated statement of change in equity and statement of change in equity of parentcompany for the year 2019 and notes to relevant financial statements. In our opinion, the attached financial statements ofyour company have been prepared in accordance with the provisions of the Accounting Standards for BusinessEnterprises and give a true and fair view of the consolidated financial position and financial position of parent company ofRobam as of December 31, 2019 and of the financial performance and cash flows for the year 2019 in all significantterms.Basis for audit opinion
We conducted our audit in accordance with the Standards on Auditing for Certified Public Accountants. The“Responsibility of certified public accountants for audit of financial statements” in the audit report further states ourresponsibility under the Standards. We were independent of Robam and fulfill other responsibilities in terms of
professional ethics according to the code of professional ethics. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion.Key audit itemsThe key audit items are those that we consider most important to audit the financial statements of the current period in ourprofessional judgment. The response to these items is based on the audit of the financial statements as a whole and theformation of an audit opinion. We do not comment on these items separately. We have identified the following items askey audit items to be communicated in the audit report.
Income recognition - Agency model and engineering channelsKey audit items
| Key audit items | Response in audit |
| Refer to Notes to financial statements IV. 27 and VI. 33 Operating income and operating cost. The operating income of Robam was RMB 7,760,581,900 in 2019, an increase of RMB 335,696,600 compared with that of 2018, including the agency mode income of RMB 2,835,281,800 and the engineering channel income of RMB 1,397,306,800, accounting for 54.54% of revenue of the period. Since the agency mode income and engineering channel income account for large proportion in the operating income and are one of the key performance indicators of Robam, there may be an inherent risk that the management may recognize the income in the wrong way to reach the specific goal or expected goal. Therefore, we regard income recognition as a key audit issue. | For the income recognition of the agency mode and engineering channels, the audit procedures we implemented mainly include: Understand key internal controls related to income recognition, evaluate and test the effectiveness of internal control design and implementation; Check the information of the shareholders and main personnel of the agency company and evaluate whether there is any correlation; Examine the main sales contracts, identify the clauses related to the major risks and transfer of remuneration in the ownership of the goods, and evaluate whether the income recognition time point conforms to the provisions of the ASBE; Carry out substantive analysis procedures on operating income and gross margin ratio by channels, customers, products, etc., identify whether there are significant or abnormal fluctuations, and analyze the causes of fluctuations; Check the original documents of the income recognition for major customers according to the income recognition policy and settlement process and evaluate the authenticity and accuracy of operating income recognition; Confirm current sales to main customers by sampling combined with the confirmation of accounts receivable; Carry out the cut-off test procedure of income, check the supporting documents such as outbound delivery order and acceptance certificate for the operating income recognized before and after the balance sheet date, and evaluate whether the operating income is recognized within an appropriate period; Check whether the information relating to operating income has been properly presented and disclosed in the financial statements. |
| Impairment of notes receivable and accounts receivable | |
| Key audit items | Response in audit |
| Refer to Notes to financial statements IV. 11.12, VI. 3 Notes receivable and VI. 4 | For the impairment of notes receivable and accounts receivable, the audit procedures we implemented mainly include: |
| Accounts receivable. As of December 31, 2019, the balance of notes receivable of Robam was RMB 1,019,683,500 and the provision for bad debt was RMB 32,990,400; the balance of accounts receivable was RMB 772,778,100, and the provision for bad debt was RMB 47,147,200. Due to the large amount of notes receivable and accounts receivable at the end of the period, the management needs to use material accounting estimate and judgment when determining the recoverable amount, so we regard the impairment of notes receivable and accounts receivable as the key audit items. | Understand key internal controls for notes receivable and accounts receivable of Robam, evaluate and test the effectiveness of internal control design and implementation; Check the contracts of main customers according to the income status, understand the settlement terms, pay attention to the customers who have not made payment after the settlement credit period or acceptance period, and analyze the reasons. Judge the solvency of customers by understanding their operating and financial conditions; Analyze the implementation of the new financial instrument standards for receivables, including the rationality of determination and estimation of the expected credit loss model for the receivables of Robam, calculate the expected credit loss amount on the balance sheet date, and analyze whether the credit loss is fully accounted for in the receivables period; Verify the rationality of expected credit loss of receivables combined with the receivables confirmation procedure and post-dated collection by analyzing the aging of accounts receivable; Carry out supervision procedures, check the balance of notes receivable at the end of the period, and check the current endorsement and discount status to check whether they conform to the derecognition conditions; Check the post-dated acceptance status of notes receivable from main customers, record the amount of notes receivable collected after the post-dated period, and check the supporting documents, such as bank receipt and other vouchers, for those with large amounts of notes receivable; Check whether the information relating to notes receivable and accounts receivable has been properly presented and disclosed in the financial statements. |
Other information
The management of Robam (hereinafter referred to as the management) is responsible for other information, including theinformation covered in Robam annual report for 2019, but excluding the financial statements and our audit report. Ouraudit opinion on the financial statements does not cover other information and we do not express any form of verificationconclusions on other information. Combined with our audit of the financial statements, it’s our responsibility to read otherinformation. In this process, we shall consider whether material inconsistency or material misstatement of otherinformation with the financial statements or the situation understood by us in the audit process. Based on the work thathas been executed by us, we should report the fact of material misstatement confirmed in other information. We have
nothing to report in this regard.Responsibility of management and government for the financial statementsThe management is responsible for preparing the financial statements in accordance with the provisions of the AccountingStandards for Business Enterprises and giving a true and fair view; designing, implementing and maintaining necessaryinternal control, so that the financial statements are free from material misstatement, whether due to fraud or error. Whenpreparing the financial statements, the management is responsible for evaluating the going-concern ability of Robam,disclosing the matters related to the going-concern (if applicable) and using the going-concern assumption, unless themanagement plans to liquidate Robam or stop operation or no other realistic options. The government is responsible forsupervising the financial reporting process of Robam.Responsibility of certified public accountants for audit of financial statements
Our goal is to obtain reasonable guarantee on inexistence of the material misstatement of the financial statementswhether due to fraud or error and to issue an audit report including audit opinion. Reasonable guarantee is high levelguarantee, but it cannot guarantee that a material misstatement of the audit executed according to the auditing standardswill always be found. Misstatement may be caused by fraud or error. If the reasonable expected misstatements may affectthe economic decision made by the financial statement user according to the financial statements, whether individually orcollectively, the misstatement is generally believed material. We made professional judgment and maintained professionalskepticism in the audit process according to the auditing standards. We also performed the following:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, designand implement audit procedures to address these risks, and obtain sufficient and appropriate audit evidence as the basisfor audit opinion. Since the fraud may involve collusion, forge, intentional omission, false statement or above internalcontrol, the risk of material misstatement caused by fraud is higher than that caused by error.Understand internal control related to the audit in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. Evaluate theappropriateness of accounting policies used and the reasonableness of accounting estimates and relevant disclosure.Draw a conclusion about the appropriateness of the going-concern assumption used by the management. Meanwhile,draw a conclusion about the major uncertainty of the matters or circumstances possibly resulting in major concerns about
the going-concern ability of Robam according to the audit evidence obtained. If we draw a conclusion that majoruncertainty exists, the auditing standards require us to request the statement user to notice relevant disclosure in thefinancial statements in the audit report; in case of insufficient disclosure, we should issue a modified audit report. Ourconclusion is made on the basis of the information available as of the audit report date. However, the future matters orcircumstances may result in going concern failure of Robam. Evaluate the overall presentation, structure and content ofthe financial statements and evaluate whether the financial statements give a true and fair view of relevant transactionsand matters. Obtain adequate and appropriate audit evidence for the financial information of Robam entity or businessactivities to express an opinion on the financial statements. We are responsible for guiding, supervising and implementingthe group audit and take full responsibility for the audit opinions. We communicate with the governance on the plannedaudit scope, time arrangement and major audit findings, including the internal control defects identified by us in the auditand worthing attention. We also provide the governance with a statement of compliance with the ethical requirementsrelating to our independence and communicate with the governance with respect to all relations and other matters thatmay reasonably be considered to affect our independence and the relevant precautions. From the items communicatedwith the governance, we determine which items are most important to the audit of current financial statements and thusconstitute the key audit items. We describe these items in our audit report, unless the disclosure of these matters isprohibited by law or regulation, or, in rare circumstances, we determine that we should not communicate the items in ouraudit report if it is reasonably expected that the negative consequences of communicating an item outweigh the benefits inthe public interest.II. Financial statementsUnit of statements in financial notes: CNY
1. Consolidated Balance Sheet
Unit: Hangzhou Robam Appliances Co., Ltd.
December 31, 2019
Unit: yuan
| Item | December 31, 2019 | December 31, 2018 |
| Current assets: | ||
| Monetary capital | 4,054,121,726.23 | 2,196,706,808.35 |
| Deposit reservation for balance | ||
| Lending funds |
| Trading financial assets | 1,360,000,000.00 | |
| Financial assets measured with fair value and with the changes included in current profit and loss | ||
| Derivative financial assets | ||
| Notes receivable | 986,693,149.40 | 1,268,146,296.01 |
| Accounts receivable | 725,630,901.28 | 446,773,135.47 |
| Receivables financing | 408,972,104.07 | |
| Advances to suppliers | 50,113,549.84 | 59,485,930.70 |
| Premiums receivables | ||
| Reinsurance accounts receivable | ||
| Provision of cession receivable | ||
| Other receivables | 110,899,448.65 | 70,182,460.52 |
| Including: Interest receivable | 0.00 | 0.00 |
| Dividends receivable | 14,295,039.38 | 0.00 |
| Redemptory monetary capital for sale | ||
| Inventory | 1,339,176,925.20 | 1,347,112,731.03 |
| Contract assets | ||
| Assets held for sales | ||
| Non-current assets due within a year | ||
| Other current assets | 16,189,237.81 | 2,591,760,176.09 |
| Total current assets | 9,051,797,042.48 | 7,980,167,538.17 |
| Non-current assets: | ||
| Loans and advances | ||
| Debt investment | ||
| Available-for-sale financial assets | 119,948,534.00 | |
| Other debt investments | ||
| Held-to-maturity investment | ||
| Long-term receivables |
| Long-term equity investment | 4,168,338.79 | 2,617,851.16 |
| Other equity instrument investments | 102,116,023.22 | |
| Other non-current financial assets | ||
| Investment properties | 112,588.34 | 121,575.14 |
| Fixed assets | 826,234,929.97 | 842,877,466.95 |
| Construction in progress | 272,211,720.62 | 184,440,655.49 |
| Productive biological assets | ||
| Oil and gas assets | ||
| Right-of-use assets | ||
| Intangible assets | 219,733,270.51 | 193,974,179.90 |
| Development expenditure | ||
| Goodwill | 80,589,565.84 | 80,589,565.84 |
| Long-term unamortized expenses | 523,195.74 | 4,933,280.77 |
| Deferred income tax assets | 70,877,116.09 | 39,564,040.41 |
| Other non-current assets | 23,558,781.27 | 6,126,821.00 |
| Total non-current assets | 1,600,125,530.39 | 1,475,193,970.66 |
| Total assets | 10,651,922,572.87 | 9,455,361,508.83 |
| Current liabilities | ||
| Short-term borrowing | ||
| Borrowings from central bank | ||
| Borrowing funds | ||
| Trading financial liabilities | ||
| Financial liabilities measured with fair value and with the changes included in current profit and loss | ||
| Derivative financial liabilities | ||
| Notes payable | 603,308,648.96 | 411,414,985.01 |
| Accounts payable | 1,395,061,285.28 | 1,195,563,149.37 |
| Advance from customers | 1,092,261,332.25 | 1,170,088,458.14 |
| Contract liabilities | ||
| Financial assets sold for repurchase |
| Deposits from customers and interbank | ||
| Acting trading securities | ||
| Acting underwriting securities | ||
| Payroll payable | 122,070,325.03 | 107,349,495.30 |
| Tax payable | 102,726,655.21 | 113,248,653.85 |
| Other payables | 241,641,864.89 | 234,490,187.04 |
| Including: Interest payable | ||
| Dividends payable | ||
| Fees and commissions payable | ||
| Dividend payable for reinsurance | ||
| Liabilities held for sales | ||
| Non-current liabilities due within a year | ||
| Other current liabilities | ||
| Total current liabilities | 3,557,070,111.62 | 3,232,154,928.71 |
| Non-current liabilities | ||
| Reserve fund for insurance contracts | ||
| Long-term borrowing | ||
| Bonds payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | ||
| Long-term payable | ||
| Long-term payroll payable | ||
| Estimated liabilities | ||
| Deferred income | 114,851,263.30 | 82,021,091.35 |
| Deferred income tax liabilities | 5,717,848.25 | 10,337,139.79 |
| Other non-current liabilities | ||
| Total non-current liabilities | 120,569,111.55 | 92,358,231.14 |
| Total liabilities | 3,677,639,223.17 | 3,324,513,159.85 |
| Owner's equity: |
| Capital stock | 949,024,050.00 | 949,024,050.00 |
| Other equity instruments | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Capital reserve | 401,799,332.67 | 401,689,801.42 |
| Minus: treasury stock | 0.00 | 3,456,989.00 |
| Other comprehensive income | -15,157,634.16 | 0.00 |
| Special reserve | 0.00 | 0.00 |
| Surplus reserves | 474,516,412.50 | 474,516,412.50 |
| General risk preparation | ||
| Undistributed profit | 5,054,206,720.45 | 4,223,611,112.65 |
| Total owners' equities attributable to the owners of parent company | 6,864,388,881.46 | 6,045,384,387.57 |
| Minority equity | 109,894,468.24 | 85,463,961.41 |
| Total owners' equities | 6,974,283,349.70 | 6,130,848,348.98 |
| Total liabilities and owners' equities | 10,651,922,572.87 | 9,455,361,508.83 |
Legal representative: Ren Jianhua Head of accounting work: Zhang Guofu Head of accounting body: Zhang Guofu
2. Balance sheet of parent company
Unit: yuan
| Item | December 31, 2019 | December 31, 2018 |
| Current assets: | ||
| Monetary capital | 3,974,490,043.89 | 2,017,251,340.16 |
| Trading financial assets | 1,100,000,000.00 | |
| Financial assets measured with fair value and with the changes included in current profit and loss | 0.00 | |
| Derivative financial assets | 0.00 | 0.00 |
| Notes receivable | 974,185,844.67 | 1,261,896,296.01 |
| Accounts receivable | 704,246,884.81 | 438,002,392.66 |
| Receivables financing | 408,605,906.50 | |
| Advances to suppliers | 41,005,526.82 | 48,995,796.40 |
| Other receivables | 105,766,154.95 | 64,301,240.95 |
| Including: Interest receivable | 0.00 | 0.00 |
| Dividends receivable | 14,295,039.38 | 0.00 |
| Inventory | 1,268,289,683.46 | 1,267,525,767.58 |
| Contract assets | ||
| Assets held for sales | 0.00 | 0.00 |
| Non-current assets due within a year | 0.00 | 0.00 |
| Other current assets | 12,064,254.50 | 2,448,736,487.97 |
| Total current assets | 8,588,654,299.60 | 7,546,709,321.73 |
| Non-current assets: | ||
| Debt investment | ||
| Available-for-sale financial assets | 119,948,534.00 | |
| Other debt investments | 0.00 | |
| Held-to-maturity investment | 0.00 | |
| Long-term receivables | 0.00 | 0.00 |
| Long-term equity investment | 230,674,272.52 | 224,608,888.64 |
| Other equity instrument investments | 102,116,023.22 | |
| Other non-current financial assets | 0.00 | |
| Investment properties | 436,960.72 | 470,485.36 |
| Fixed assets | 798,954,901.11 | 815,345,909.65 |
| Construction in progress | 271,619,361.89 | 184,365,655.49 |
| Productive biological assets | 0.00 | 0.00 |
| Oil and gas assets | 0.00 | 0.00 |
| Right-of-use assets | 0.00 | |
| Intangible assets | 157,002,023.43 | 161,743,355.41 |
| Development expenditure | 0.00 | 0.00 |
| Goodwill | 0.00 | 0.00 |
| Long-term unamortized expenses | 383,195.74 | 4,933,280.77 |
| Deferred income tax assets | 70,173,783.09 | 38,723,474.50 |
| Other non-current assets | 23,558,781.27 | 6,126,821.00 |
| Total non-current assets | 1,654,919,302.99 | 1,556,266,404.82 |
| Total assets | 10,243,573,602.59 | 9,102,975,726.55 |
| Current liabilities | ||
| Short-term borrowing | ||
| Trading financial liabilities | ||
| Financial liabilities measured with fair value and with the changes included in current profit and loss | ||
| Derivative financial liabilities | ||
| Notes payable | 601,960,648.96 | 409,057,910.01 |
| Accounts payable | 1,358,297,550.30 | 1,158,684,039.60 |
| Advance from customers | 983,128,543.51 | 1,067,652,543.09 |
| Contract liabilities | ||
| Payroll payable | 97,599,336.20 | 88,814,022.76 |
| Tax payable | 96,425,637.42 | 99,200,231.67 |
| Other payables | 226,064,422.04 | 215,230,256.63 |
| Including: Interest payable | 0.00 | 0.00 |
| Dividends payable | 0.00 | 0.00 |
| Liabilities held for sales | 0.00 | 0.00 |
| Non-current liabilities due within a year | 0.00 | 0.00 |
| Other current liabilities | 0.00 | 0.00 |
| Total current liabilities | 3,363,476,138.43 | 3,038,639,003.76 |
| Non-current liabilities | ||
| Long-term borrowing | ||
| Bonds payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | ||
| Long-term payable | ||
| Long-term payroll payable | ||
| Estimated liabilities | ||
| Deferred income | 114,851,263.30 | 82,021,091.35 |
| Deferred income tax liabilities | 0.00 | 0.00 |
| Other non-current liabilities | 0.00 | 0.00 |
| Total non-current liabilities | 114,851,263.30 | 82,021,091.35 |
| Total liabilities | 3,478,327,401.73 | 3,120,660,095.11 |
| Owner's equity: | ||
| Capital stock | 949,024,050.00 | 949,024,050.00 |
| Other equity instruments | 0.00 | 0.00 |
| Including: preferred stock | 0.00 | 0.00 |
| Perpetual bond | 0.00 | 0.00 |
| Capital reserve | 401,754,349.66 | 401,644,818.41 |
| Minus: treasury stock | 0.00 | 3,456,989.00 |
| Other comprehensive income | -15,157,634.16 | 0.00 |
| Special reserve | 0.00 | 0.00 |
| Surplus reserves | 474,516,412.50 | 474,516,412.50 |
| Undistributed profit | 4,955,109,022.86 | 4,160,587,339.53 |
| Total owners' equities | 6,765,246,200.86 | 5,982,315,631.44 |
| Total liabilities and owners' equities | 10,243,573,602.59 | 9,102,975,726.55 |
3. Consolidated Statement of Income
Unit: yuan
| Item | Year 2019 | Year 2018 |
| I. Total operating income | 7,760,581,855.53 | 7,424,885,274.14 |
| Including: Operating income | 7,760,581,855.53 | 7,424,885,274.14 |
| Interest revenue | ||
| Premium earned | ||
| Fee and commission income | ||
| II. Total operating costs | 6,044,077,772.58 | 5,895,635,221.01 |
| Including: Operating costs | 3,548,777,745.04 | 3,450,765,242.29 |
| Interest expenditure | ||
| Fee and commission expense | ||
| Surrender value | ||
| Net payments for insurance claims | ||
| Net reserve fund extracted for insurance contracts | ||
| Bond insurance expense |
| Reinsurance costs | ||
| Taxes and surcharges | 66,618,104.73 | 70,571,367.91 |
| Selling expenses | 1,928,259,172.35 | 1,909,856,779.45 |
| Management costs | 284,364,115.17 | 272,355,117.98 |
| Research and development expenses | 299,469,126.54 | 293,427,244.80 |
| Financial expenses | -83,410,491.25 | -101,340,531.42 |
| Including: interest expenditure | 477,352.78 | 0.00 |
| Interest revenue | 84,590,717.34 | 100,908,995.14 |
| Plus: other incomes | 86,454,822.71 | 99,254,844.76 |
| Income from investment (loss expressed with “-”) | 127,100,794.11 | 88,009,702.42 |
| Including: Income from investment of joint venture and cooperative enterprise | 1,550,487.63 | -1,197,385.79 |
| Income from derecognition of financial assets measured at amortized cost | ||
| Exchange gain (loss expressed with “-”) | ||
| Net exposure hedging gain (loss expressed with “-”) | ||
| Income from fair value changes (loss expressed with “-”) | ||
| Credit impairment losses (loss expressed with “-”) | -48,823,331.47 | |
| Assets impairment losses (loss expressed with “-”) | -9,321,963.35 | -15,059,762.05 |
| Income from disposal of assets (loss expressed with “-”) | -158,607.19 | 101,198.59 |
| III. Operating profits (loss expressed with “-”) | 1,871,755,797.76 | 1,701,556,036.85 |
| Plus: Non-operating income | 4,098,230.54 | 2,375,724.71 |
| Less: non-operating expenditure | 4,323,553.72 | 1,607,088.22 |
| IV. Total profits (total loss expressed with “-”) | 1,871,530,474.58 | 1,702,324,673.34 |
| Less: Income tax expenses | 257,285,119.95 | 218,476,769.49 |
| V. Net profits (net loss expressed with “-”) | 1,614,245,354.63 | 1,483,847,903.85 |
| (I) Classified by business continuity | ||
| 1. Net profits from ongoing operation (net loss expressed with “-”) | 1,614,245,354.63 | 1,483,847,903.85 |
| 2. Net profits from discontinuing operation (net |
| loss expressed with “-”) | ||
| (II) Classified by ownership | ||
| 1. Net profits attributable to the owners of parent company | 1,589,814,847.80 | 1,473,579,665.62 |
| 2. Minority interest income | 24,430,506.83 | 10,268,238.23 |
| VI. Net amount of other comprehensive income after tax | -15,157,634.16 | 0.00 |
| Net amount of other comprehensive income after tax attributed to parent company owners | -15,157,634.16 | 0.00 |
| (I) Other comprehensive income that can't be reclassified into profit and loss | -15,157,634.16 | 0.00 |
| 1. Remeasure the variation of net indebtedness or net asset of defined benefit plan | 0.00 | 0.00 |
| 2. Other comprehensive income that can't be reclassified into profit and loss in the invested enterprise under equity method | 0.00 | 0.00 |
| 3. Fair value change of other equity instrument investments | -15,157,634.16 | 0.00 |
| 4. Fair value change of enterprise credit risks | ||
| 5. Other | ||
| (II) Other comprehensive income that will be reclassified into profit and loss | ||
| 1. Other comprehensive income that will be reclassified into profit and loss in the invested enterprise under equity method | ||
| 2. Fair value change of other debt investments | ||
| 3. Profit and loss from fair value changes of available-for-sale financial assets | ||
| 4. Amount of financial assets reclassified into other comprehensive income | ||
| 5. Profit and loss from reclassification of held-to-maturity investment as available-for-sale financial assets | ||
| 6. Provision for credit impairment of other debt investments | ||
| 7. Cash flow hedging reserve |
| 8. Translation reserve | ||
| 9. Other | ||
| Net amount of other comprehensive income after tax attributed to minority shareholders | ||
| VII. Total comprehensive income | 1,599,087,720.47 | 1,483,847,903.85 |
| Total comprehensive income attributed to parent company owners | 1,574,657,213.64 | 1,473,579,665.62 |
| Total comprehensive income belonging to minority shareholders | 24,430,,506.83 | 10,268,238.23 |
| VIII. Earnings per share | ||
| (I) Basic earnings per share | 1.68 | 1.55 |
| (II) Diluted earnings per share | 1.68 | 1.55 |
ILegal representative: Ren Jianhua Head of accounting work: Zhang Guofu Head of accounting body: Zhang Guofu
4. Income statement of parent company
Unit: yuan
| Item | Year 2019 | Year 2018 |
| I. Operating income | 7,171,273,971.28 | 6,951,127,584.80 |
| Subtract: Operating costs | 3,380,454,870.95 | 3,359,935,498.94 |
| Taxes and surcharges | 59,608,538.30 | 64,139,003.83 |
| Selling expenses | 1,663,615,331.66 | 1,657,179,627.56 |
| Management costs | 203,713,247.47 | 198,371,268.76 |
| Research and development expenses | 289,897,222.53 | 286,597,606.23 |
| Financial expenses | -82,103,320.70 | -96,269,643.72 |
| Including: interest expenditure | 477,352.78 | 0.00 |
| Interest revenue | 82,747,708.18 | 95,425,460.45 |
| Plus: other incomes | 80,543,507.55 | 93,295,114.76 |
| Income from investment (loss expressed with “-”) | 118,589,082.46 | 87,724,316.13 |
| Including: Income from investment of joint venture and cooperative enterprise | 1,550,487.63 | -1,197,385.79 |
| Income from derecognition of financial assets measured at amortized cost (loss expressed with “-”) | 0.00 | 0.00 |
| Net exposure hedging gain (loss expressed with “-”) | 0.00 | |
| Income from fair value changes (loss expressed with “-”) | 0.00 | 0.00 |
| Credit impairment losses (loss expressed with “-”) | -47,422,169.48 | |
| Assets impairment losses (loss expressed with “-”) | -9,321,963.35 | -12,359,773.30 |
| Income from disposal of assets (loss expressed with “-”) | -303,654.83 | 111,267.72 |
| II. Operating profit (loss to be filled out with the minus sign "-") | 1,798,172,883.42 | 1,649,945,148.51 |
| Plus: Non-operating income | 3,704,034.22 | 984,374.74 |
| Less: non-operating expenditure | 1,542,215.05 | 1,471,067.61 |
| III. Total profit (total loss to be filled out with the minus sign "-") | 1,800,334,702.59 | 1,649,458,455.64 |
| Less: Income tax expenses | 246,593,779.26 | 207,300,358.39 |
| IV. Net profit (net loss to be filled out with the minus sign "-") | 1,553,740,923.33 | 1,442,158,097.25 |
| (I) Net profits from going concern (net loss expressed with “-”) | 1,553,740,923.33 | 1,442,158,097.25 |
| (II) Net profits from discontinuing operation (net loss expressed with “-”) | ||
| V. Net amount of other comprehensive income after tax | -15,157,634.16 | |
| (I) Other comprehensive income that can't be reclassified into profit and loss | -15,157,634.16 | |
| 1. Remeasure the variation of net indebtedness or net asset of defined benefit plan | ||
| 2. Other comprehensive income that can't be reclassified into profit and loss in the invested enterprise under equity method | ||
| 3. Fair value change of other equity instrument investments | -15,157,634.16 | |
| 4. Fair value change of enterprise credit risks | ||
| 5. Other | ||
| (II) Other comprehensive income that will be |
| reclassified into profit and loss | ||
| 1. Other comprehensive income that will be reclassified into profit and loss in the invested enterprise under equity method | ||
| 2. Fair value change of other debt investments | ||
| 3. Profit and loss from fair value changes of available-for-sale financial assets | ||
| 4. Amount of financial assets reclassified into other comprehensive income | ||
| 5. Profit and loss from reclassification of held-to-maturity investment as available-for-sale financial assets | ||
| 6. Provision for credit impairment of other debt investments | ||
| 7. Cash flow hedging reserve | ||
| 8. Translation reserve | ||
| 9. Other | ||
| VI. Total comprehensive income | 1,538,583,289.17 | 1,442,158,097.25 |
| VII. Earnings per share | ||
| (I) Basic earnings per share | ||
| (II) Diluted earnings per share |
5. Consolidated Statement of Cash Flow
Unit: yuan
| Item | Year 2019 | Year 2018 |
| I. Cash flow from financing activities: | ||
| Cash from selling commodities or offering labor | 7,864,881,727.36 | 8,453,586,919.00 |
| Net increase of customer deposit and deposit from other banks | ||
| Net increase of borrowings from central bank | ||
| Net increase of borrowing funds from other financial institutions | ||
| Cash from obtaining original insurance contract premium | ||
| Cash received from insurance premium of |
| original insurance contract | ||
| Net increase of deposit and investment of insured | ||
| Cash from interest, handling charges and commissions | ||
| Net increase of borrowing funds | ||
| Net increase of repurchase of business funds | ||
| Net cash from acting trading securities | ||
| Refund of tax and levies | 15,076.40 | 136,806.08 |
| Other cash received related to operating activities | 313,827,100.02 | 238,417,540.82 |
| Subtotal cash inflows from operating activities | 8,178,723,903.78 | 8,692,141,265.90 |
| Cash paid for selling commodities or offering labor | 3,263,409,930.51 | 3,867,146,241.25 |
| Net increase of customer loans and advances | ||
| Net increase of amount due from central bank and interbank | ||
| Cash paid for original insurance contract claims payment | ||
| Net increase of lending funds | ||
| Cash paid for interest, handling charges and commissions | ||
| Cash paid for policy dividend | ||
| Cash paid to and for employees | 781,240,228.31 | 747,113,055.19 |
| Taxes and fees paid | 852,036,925.94 | 835,908,616.02 |
| Other cash paid related to operating activities | 1,726,815,892.12 | 1,733,013,042.15 |
| Subtotal cash outflows from operating activities | 6,623,502,976.88 | 7,183,180,954.61 |
| Net cash flow from operating activities | 1,555,220,926.90 | 1,508,960,311.29 |
| II. Cash flow from investment activities: | ||
| Cash from investment withdrawal | 3,898,500,000.00 | 2,932,936,302.46 |
| Cash from investment income | 122,289,095.82 | 87,103,727.00 |
| Net cash from disposal of fixed assets, intangible assets and other long-term assets | 413,677.00 | 153,807.52 |
| Net cash received from the disposal of subsidiaries and other business entities | 0.00 | |
| Other cash received related to investment activities | 0.00 | 10,000,000.00 |
| Subtotal cash inflows from investment activities | 4,021,202,772.82 | 3,030,193,836.98 |
| Cash paid for the purchase and construction of fixed assets, intangible assets and other long term assets | 272,163,320.83 | 180,703,214.09 |
| Cash paid for investment | 2,693,500,000.00 | 3,978,000,000.00 |
| Net cash received from reinsurance business | 0.00 | |
| Net cash paid for obtaining subsidiaries and other business units | 44,994,413.72 | |
| Other cash paid related to investment activities | 10,000,000.00 | |
| Subtotal cash outflows from investment activities | 2,965,663,320.83 | 4,213,697,627.81 |
| Net cash flow from investment activities | 1,055,539,451.99 | -1,183,503,790.83 |
| III. Cash flow from financing activities: | ||
| Receipts from equity securities | ||
| Including: Cash received from subsidies’ absorption of minority shareholders’ investment | ||
| Cash received from borrowings | ||
| Other cash received related to financing activities | ||
| Subtotal cash inflows from financing activities | ||
| Cash repayments of amounts borrowed | ||
| Cash paid for distribution of dividends or profits and for interest expenses | 759,219,240.00 | 711,774,618.75 |
| Including: Dividends and profits paid by subsidiaries to minority shareholders | ||
| Other cash paid related to financing activities | 83,011.50 | |
| Subtotal cash outflows from financing activities | 759,219,240.00 | 711,857,630.25 |
| Net cash flow from financing activities | -759,219,240.00 | -711,857,630.25 |
| IV. Impact of exchange rate movements on cash and cash equivalents | 535,267.76 | 832,944.26 |
| V. Net increase of cash and cash equivalents | 1,852,076,406.65 | -385,568,165.53 |
| Plus: Balance of cash and cash equivalents at the beginning of the period | 2,177,219,858.85 | 2,562,788,024.38 |
| Plus: Balance of cash and cash equivalents at the beginning of the period | 4,029,296,265.50 | 2,177,219,858.85 |
6. Cash flow statement of parent company
Unit: yuan
| Item | Year 2019 | Year 2018 |
| I. Cash flow from financing activities: | ||
| Cash from selling commodities or offering labor | 7,234,628,896.12 | 7,892,426,799.39 |
| Refund of tax and levies | 0.00 | 0.00 |
| Other cash received related to operating activities | 263,736,687.48 | 220,781,708.77 |
| Subtotal cash inflows from operating activities | 7,498,365,583.60 | 8,113,208,508.16 |
| Cash paid for selling commodities or offering labor | 3,102,184,422.96 | 3,733,904,041.52 |
| Cash paid to and for employees | 578,818,044.96 | 562,371,084.94 |
| Taxes and fees paid | 768,377,438.19 | 764,184,204.54 |
| Other cash paid related to operating activities | 1,539,782,850.67 | 1,599,163,876.52 |
| Subtotal cash outflows from operating activities | 5,989,162,756.78 | 6,659,623,207.52 |
| Net cash flow from operating activities | 1,509,202,826.82 | 1,453,585,300.64 |
| II. Cash flow from investment activities: | ||
| Cash from investment withdrawal | 3,330,000,000.00 | 2,824,936,302.46 |
| Cash from investment income | 113,777,384.17 | 86,818,340.71 |
| Net cash from disposal of fixed assets, intangible assets and other long-term assets | 540,568.71 | 153,807.52 |
| Net cash received from the disposal of subsidiaries and other business entities | 0.00 | 0.00 |
| Other cash received related to investment activities | 0.00 | 10,000,000.00 |
| Subtotal cash inflows from investment activities | 3,444,317,952.88 | 2,921,908,450.69 |
| Cash paid for the purchase and construction of fixed assets, intangible assets and other long term assets | 234,445,701.10 | 178,389,055.15 |
| Cash paid for investment | 2,009,500,000.00 | 3,887,320,000.00 |
| Net cash paid for obtaining subsidiaries and other business units | 0.00 | 0.00 |
| Other cash paid related to investment activities | 0.00 | 10,000,000.00 |
| Subtotal cash outflows from investment activities | 2,243,945,701.10 | 4,075,709,055.15 |
| Net cash flow from investment activities | 1,200,372,251.78 | -1,153,800,604.46 |
| III. Cash flow from financing activities: | ||
| Receipts from equity securities | 0.00 | 0.00 |
| Cash received from borrowings | 0.00 | 0.00 |
| Other cash received related to financing activities | 0.00 | 0.00 |
| Subtotal cash inflows from financing activities | 0.00 | 0.00 |
| Cash repayments of amounts borrowed | 0.00 | 0.00 |
| Cash paid for distribution of dividends or profits and for interest expenses | 759,219,240.00 | 711,774,618.75 |
| Other cash paid related to financing activities | 0.00 | 83,011.50 |
| Subtotal cash outflows from financing activities | 759,219,240.00 | 711,857,630.25 |
| Net cash flow from financing activities | -759,219,240.00 | -711,857,630.25 |
| IV. Impact of exchange rate movements on cash and cash equivalents | 535,278.90 | 832,769.83 |
| V. Net increase of cash and cash equivalents | 1,950,891,117.50 | -411,240,164.24 |
| Plus: Balance of cash and cash equivalents at the beginning of the period | 2,000,183,395.66 | 2,411,423,559.90 |
| Plus: Balance of cash and cash equivalents at the beginning of the period | 3,951,074,513.16 | 2,000,183,395.66 |
7. Consolidated statement of change in equity
| Item | Year 2019 | ||||||||||||||
| Owners' equities attributable to the owners of parent company | Minority equity | Total owners' equities | |||||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | General risk preparation | Undistributed profit | Other | Subtotal | |||||
| Preferred stock | Perpetual bond | Other | |||||||||||||
| I. Ending balance in previous year | 949,024,050.00 | 0.00 | 0.00 | 0.00 | 401,689,801.42 | 3,456,989.00 | 474,516,412.50 | 4,223,611,112.65 | 6,045,384,387.57 | 85,463,961.41 | 6,130,848,348.98 | ||||
| Plus: Changes in accounting policies | 0.00 | ||||||||||||||
| Prior period error correction | 0.00 | ||||||||||||||
| Business combination under common control | 0.00 | ||||||||||||||
| Other | 0.00 | ||||||||||||||
| II. Beginning balance in current year | 949,024,050.00 | 0.00 | 0.00 | 0.00 | 401,689,801.42 | 3,456,989.00 | 474,516,412.50 | 4,223,611,112.65 | 6,045,384,387.57 | 85,463,961.41 | 6,130,848,348.98 | ||||
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-) | 0.00 | 0.00 | 0.00 | 0.00 | 109,531.25 | -3,456,989.00 | -15,157,634.16 | 830,595,607.80 | 819,004,493.89 | 24,430,506.83 | 843,435,000.72 | ||||
| (I) Total comprehensive income | -15,157,634.16 | 1,589,814,847.80 | 1,574,657,213.64 | 24,430,506.83 | 1,599,087,720.47 | ||||||||||
| (II) Owner’s invested and decreased capital | 0.00 | 0.00 | 0.00 | 0.00 | 109,531.25 | -3,456,989.00 | 3,566,520.25 | 3,566,520.25 | |||||||
| 1. Common stock invested by the owner | 0.00 | ||||||||||||||
| 2. Capital invested by other equity instrument holders | 0.00 | ||||||||||||||
| 3. Amount of share-based payment included | 109,531.25 | -3,456,989.0 | 3,566,520.25 | 3,566,520.25 |
| in the owner’s equity | 0 | ||||||||||||||
| 4. Other | 0.00 | ||||||||||||||
| (III) Profit distribution | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | -759,219,240.00 | -759,219,240.00 | -759,219,240.00 | |||||||
| 1. Withdrawal of surplus reserves | 0.00 | ||||||||||||||
| 2. Withdrawal of general risk preparation | |||||||||||||||
| 3. Distribution of owners (or shareholders) | -759,219,240.00 | -759,219,240.00 | -759,219,240.00 | ||||||||||||
| 4. Other | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |||||||||
| (IV) Internal transfer of owner’s equity | 0.00 | ||||||||||||||
| 1. Capital surplus transfer to paid-in capital (or capital stock) | 0.00 | ||||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | 0.00 | ||||||||||||||
| 3. Earned surplus covering the deficit | 0.00 | ||||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | 0.00 | ||||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | 0.00 |
Current amount
Unit: yuanLast term amount
Unit: yuan
| Item | 2018 | ||||||||||||||
| Owners' equities attributable to the owners of parent company | Minority equity | Total owners' equities | |||||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | General risk preparation | Undistributed profit | Other | Subtotal | |||||
| Preferred stock | Perpetual bond | Other | |||||||||||||
| I. Ending balance in previous year | 949,032,825.00 | 399,598,507.63 | 24,153,010.00 | 474,516,412.50 | 3,461,806,065.78 | 5,260,800,800.91 | -3,329,595.92 | 5,257,471,204.99 | |||||||
| Plus: Changes in accounting policies | |||||||||||||||
| Prior period error correction | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Other | |||||||||||||||
| II. Beginning balance in | 949, | 399,5 | 24,15 | 474,5 | 3,461 | 5,260 | -3,329, | 5,257,4 | |||||||
| 6. Other | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |||||
| (V) Special reserve | 0.00 | ||||||||||||||
| 1. Draw in this current | 0.00 | ||||||||||||||
| 2. Use in this current | 0.00 | ||||||||||||||
| (VI) Other | |||||||||||||||
| IV. Balance at the end of current period | 949,024,050.00 | 401,799,332.67 | -15,157,634.16 | 474,516,412.50 | 5,054,206,720.45 | 6,864,388,881.46 | 109,894,468.24 | 6,974,283,349.70 |
| current year | 032,825.00 | 98,507.63 | 3,010.00 | 16,412.50 | ,806,065.78 | ,800,800.91 | 595.92 | 71,204.99 | |||||||
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-) | -8,775.00 | 2,091,293.79 | -20,696,021.00 | 0.00 | 761,805,046.87 | 784,583,586.66 | 88,793,557.33 | 873,377,143.99 | |||||||
| (I) Total comprehensive income | 1,473,579,665.62 | 1,473,579,665.62 | 10,268,238.23 | 1,483,847,903.85 | |||||||||||
| (II) Owner’s invested and decreased capital | -8,775.00 | 2,091,293.79 | -20,696,021.00 | 22,778,539.79 | 78,525,319.10 | 101,303,858.89 | |||||||||
| 1. Common stock invested by the owner | -8,775.00 | -8,775.00 | -8,775.00 | ||||||||||||
| 2. Capital invested by other equity instrument holders | 0.00 | ||||||||||||||
| 3. Amount of share-based payment included in the owner’s equity | 2,091,293.79 | -20,696,021.00 | 22,787,314.79 | 22,787,314.79 | |||||||||||
| 4. Other | 0.00 | 78,525,319.10 | 78,525,319.10 | ||||||||||||
| (III) Profit distribution | -711,774,618.75 | -711,774,618.75 | 0.00 | -711,774,618.75 | |||||||||||
| 1. Withdrawal of surplus reserves | 0.00 | 0.00 | |||||||||||||
| 2. Withdrawal of general risk preparation | |||||||||||||||
| 3. Distribution of owners (or shareholders) | -711,774,618.75 | -711,774,618.80 | -711,774,618.80 | ||||||||||||
| 4. Other | |||||||||||||||
| (IV) Internal transfer of owner’s equity |
| 1. Capital surplus transfer to paid-in capital (or capital stock) | |||||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | |||||||||||||||
| 3. Earned surplus covering the deficit | |||||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | |||||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | |||||||||||||||
| 6. Other | |||||||||||||||
| (V) Special reserve | |||||||||||||||
| 1. Draw in this current | |||||||||||||||
| 2. Use in this current | |||||||||||||||
| (VI) Other | |||||||||||||||
| IV. Balance at the end of current period | 949,024,050.00 | 401,689,801.42 | 3,456,989.00 | 474,516,412.50 | 4,223,611,112.65 | 6,045,384,387.57 | 85,463,961.41 | 6,130,848,348.98 |
8. Statement of change in equity of parent company
Current amount
Unit: yuan
| Item | Year 2019 | |||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | Undistributed profit | Other | Total owners' equities | |||
| Preferred stock | Perpetual bond | Other | ||||||||||
| I. Ending balance in previous year | 949,024,050.00 | 0.00 | 0.00 | 0.00 | 401,644,818.41 | 3,456,989.00 | 0.00 | 0.00 | 474,516,412.50 | 4,160,587,339.53 | 5,982,315,631.44 | |
| Plus: Changes in accounting | 0.00 | |||||||||||
| policies | ||||||||||||
| Prior period error correction | 0.00 | |||||||||||
| Other | 0.00 | |||||||||||
| II. Beginning balance in current year | 949,024,050.00 | 0.00 | 0.00 | 0.00 | 401,644,818.41 | 3,456,989.00 | 0.00 | 0.00 | 474,516,412.50 | 4,160,587,339.53 | 5,982,315,631.44 | |
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-) | 0.00 | 0.00 | 0.00 | 0.00 | 109,531.25 | -3,456,989.00 | -15,157,634.16 | 0.00 | 0.00 | 794,521,683.33 | 782,930,569.42 | |
| (I) Total comprehensive income | -15,157,634.16 | 1,553,740,923.33 | 1,538,583,289.17 | |||||||||
| (II) Owner’s invested and decreased capital | 0.00 | 0.00 | 0.00 | 0.00 | 109,531.25 | -3,456,989.00 | 0.00 | 0.00 | 0.00 | 0.00 | 3,566,520.25 | |
| 1. Common stock invested by the owner | 0.00 | |||||||||||
| 2. Capital invested by other equity | 0.00 |
| instrument holders | ||||||||||||
| 3. Amount of share-based payment included in the owner’s equity | 109,531.25 | -3,456,989.00 | 3,566,520.25 | |||||||||
| 4. Other | 0.00 | |||||||||||
| (III) Profit distribution | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | -759,219,240.00 | -759,219,240.00 | |
| 1. Withdrawal of surplus reserves | 0.00 | |||||||||||
| 2. Distribution of owners (or shareholders) | -759,219,240.00 | -759,219,240.00 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Internal transfer of owner’s equity | ||||||||||||
| 1. Capital surplus transfer to paid-in capital (or capital stock) | ||||||||||||
| 2. Earned surplus transfer to paid-in capital (or |
| capital stock) | ||||||||||||
| 3. Earned surplus covering the deficit | ||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | ||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1. Draw in this current | ||||||||||||
| 2. Use in this current | ||||||||||||
| (VI) Other | ||||||||||||
| IV. Balance at the end of current period | 949,024,050.00 | 0.00 | 0.00 | 0.00 | 401,754,349.66 | 0.00 | -15,157,634.16 | 0.00 | 474,516,412.50 | 4,955,109,022.86 | 6,765,246,200.86 |
Last term amount
Unit: yuan
| Item | 2018 | |||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive | Special reserve | Surplus reserv | Undistributed profit | Other | Total owners' equities | |||
| Preferred | Perpetual | Other | ||||||||||
| stock | bond | income | es | |||||||||
| I. Ending balance in previous year | 949,032,825.00 | 0.00 | 0.00 | 0.00 | 399,553,524.62 | 24,153,010.00 | 0.00 | 0.00 | 474,516,412.50 | 3,430,203,861.03 | 5,229,153,613.15 | |
| Plus: Changes in accounting policies | 0.00 | |||||||||||
| Prior period error correction | 0.00 | |||||||||||
| Other | 0.00 | |||||||||||
| II. Beginning balance in current year | 949,032,825.00 | 0.00 | 0.00 | 0.00 | 399,553,524.62 | 24,153,010.00 | 0.00 | 0.00 | 474,516,412.50 | 3,430,203,861.03 | 5,229,153,613.15 | |
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-) | -8,775.00 | 0.00 | 0.00 | 0.00 | 2,091,293.79 | -20,696,021.00 | 0.00 | 0.00 | 0.00 | 730,383,478.50 | 753,162,018.29 | |
| (I) Total comprehensive income | 1,442,158,097.25 | 1,442,158,097.25 | ||||||||||
| (II) Owner’s invested and decreased capital | -8,775.00 | 0.00 | 0.00 | 0.00 | 2,091,293.79 | -20,696,021.00 | 0.00 | 0.00 | 0.00 | 0.00 | 22,778,539.79 |
| 1. Common stock invested by the owner | -8,775.00 | -8,775.00 | ||||||||||
| 2. Capital invested by other equity instrument holders | 0.00 | |||||||||||
| 3. Amount of share-based payment included in the owner’s equity | 2,091,293.79 | -20,696,021.00 | 22,787,314.79 | |||||||||
| 4. Other | 0.00 | |||||||||||
| (III) Profit distribution | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | -711,774,618.75 | -711,774,618.75 | |
| 1. Withdrawal of surplus reserves | 0.00 | |||||||||||
| 2. Distribution of owners (or shareholders) | -711,774,618.75 | -711,774,618.75 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Internal transfer of owner’s equity | ||||||||||||
| 1. Capital surplus transfer to |
| paid-in capital (or capital stock) | ||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | ||||||||||||
| 3. Earned surplus covering the deficit | ||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | ||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1. Draw in this current | ||||||||||||
| 2. Use in this current | ||||||||||||
| (VI) Other | ||||||||||||
| IV. Balance at the end | 949,024,050.00 | 0.00 | 0.00 | 0.00 | 401,644,818.4 | 3,456,989.00 | 0.00 | 0.00 | 474,516,412. | 4,160,587,339.53 | 5,982,315,631.44 |
| of current period | 1 | 50 |
III. Basic status of companyBasic status of enterpriseHangzhou Robam Appliances Co., Ltd. (Robam or the Company) is a limited liability company established by HangzhouRobam Home Appliances & Kitchen Sanitary Co., Ltd. by means of overall change on November 7, 2000. Approved byChina Securities Regulatory Commission (ZJXK [2010] No.1512) in 2010, the Company issued 40 million ordinary sharesto the public for the first time on November 23, 2010, with a par value of RMB 1 per share and an issue price of RMB
24.00 and the stock code of 002508.
As of December 31, 2019, the capital stock of the Company after several equity changes was RMB 949,024,050. Unifiedsocial credit code: 91330000725252053F, legal representative: Ren Jianhua; address: No.592, Linping Av., YuhangEconomic Development Zone, Hangzhou, China.The Company is mainly engaged in the development, production, sales and comprehensive services of kitchenappliances in the manufacturing industry. Its main products include range hood, gas hob, sterilizer, steamer, oven,dishwasher, water purifier, microwave, integrated stove and purification tank.The main business scope is manufacture, processing, sales, export and import business of range hook, gas stove,sterilized cupboard, oven, steam oven, microwave oven, dishwasher, water purifier, multifunctional tank, kitchenware andother kitchen appliances, as well as the technical services of home appliances. (Any project that needs to be approved bylaw can only be carried out after getting approval by relevant authorities.)IV. Preparation basis of financial statements
1. Preparation basis
The financial statements of the Company are prepared on the basis of the going-concern and the accounting policy andaccounting estimate in “IV. Significant accounting policy and accounting estimate” according to the actual transactions anditems, the Accounting Standards for Business Enterprises promulgated by the Ministry of Finance and relevant provisions.
2. Going concern
After comprehensive consideration to the macro policy risks, market operation risks, Company’s current and long-termprofitability, solvency, financial flexibility, intention of the management to change its business policy and other factors, theCompany's management believes that the Company has no issue affecting the Company's going-concern ability within 12months from the end of the report.
V. Significant accounting policy and accounting estimateSpecific accounting policy and accounting estimate:
The specific accounting policies and accounting estimates formulated by the Company according to the actual productionand operation characteristics include the operating cycle, the recognition and measurement of bad debt provision ofreceivables, the measurement of issued inventory, the classification and depreciation of fixed assets, the amortization ofintangible assets, the capitalization conditions of R&D expenses, the income recognition and measurement, etc.
1. Statement of compliance with Accounting Standards for Business EnterprisesThe Company’s financial statements comply with the requirements of the ASBE and truly and completely reflect theCompany's financial position, business performance, cash flows and other relevant information.
2. Accounting period
The fiscal year of the Company runs from January 1 to December 31 of each calendar year.
3. Operating cycle
The Company’s normal operating cycle is one year (12 months).
4. Bookkeeping currency
The bookkeeping currency of the Company is RMB.
5. Accounting process method of business combination involving enterprises under and notunder common controlThe assets and liabilities acquired by the Company as the combining party through business combination under commoncontrol are measured on the combination date according to the book value of the combined party in the consolidatedstatements of the final controlling party. The difference between the book value of the net assets obtained and theconsideration paid for the combination is adjusted against capital reserve; if the capital reserve is not sufficient to absorbthe difference, the retained earnings shall be adjusted.The acquiree's identifiable assets, liabilities and contingent liabilities acquired through business combination not undercommon control are measured at fair value on the acquisition date. The combined cost is the fair value of the cash ornon-cash assets paid, liabilities incurred or assumed and equity securities issued by the acquirer on the acquiring date foracquisition of the control right of the acquiree, as well as the sum of direct costs for the business combination (for thebusiness combination realized by steps through several times, the combined cost is the sum of the costs of eachtransaction). Where the combined cost exceeds the acquirer’s interest in the fair value of the acquiree’s net identifiableassets, the difference is recognized as goodwill; where the combined cost is less than the acquirer’s interest in the fairvalue of the acquiree’s net identifiable assets, the acquirer first reassesses the fair values of the acquiree's identifiableassets, liabilities and contingent liabilities in combination and the fair values of non-cash assets or equity securities issuedfor consolidation consideration. If after reassessment, the combined cost is still less than the acquirer's interest in the fair
value of the acquiree’s net identifiable assets, the difference is included in the current non-operating income.
6. Methods for preparing consolidated financial statements
The Company includes all subsidiaries under its control in the consolidated financial statements.In preparing the consolidated financial statements, where the accounting policies and the accounting periods of theCompany and subsidiaries are inconsistent, the financial statements of the subsidiaries are adjusted in accordance withthe accounting policies and the accounting period of the Company. All significant internal transactions, current balancesand unrealized profits in the consolidation scope shall be set off when the consolidated statements are prepared. Theshare of the owner's equity of the subsidiaries not attributable to the parent company and current net profits and losses,other comprehensive income, and the share of other comprehensive income attributable to the minority interests shall bepresented in the consolidated financial statements under “minority equity, minority interest income, other comprehensiveincome attributed to minority shareholders and total comprehensive income attributed to minority shareholders”. For asubsidiary in the business combination under common control, its business performance and cash flows have beenconsolidated since the beginning of the consolidation year into the consolidated financial statements. When preparing andcomparing the consolidated financial statements, the Company shall adjust the relevant items of the previous year'sfinancial statements, which shall be regarded as the subject of the consolidated report that has been in existence sincethe beginning of the control by the final controlling party.For a subsidiary in the business combination not under common control, its business performance and cash flows shall beincorporated into the consolidated financial statements from the date of the Company's acquisition of control. In preparingthe consolidated financial statements, the financial statements of the subsidiary shall be adjusted on the basis of the fairvalues of the identifiable assets, liabilities and contingent liabilities as determined on the acquiring date.If the Company acquires the equity of the acquiree by steps through several deals and finally forms business combinationnot under common control, in the compilation of the consolidated statements, as for the equity interests held in theacquiree before the acquiring date, they shall be re-measured according to their fair values at the acquiring date; thedifference between their fair values and book value shall be recorded into the investment gains for the period including theacquiring date. Other related comprehensive gains in relation to the equity interests held in the acquiree under the equityaccounting before the acquiring date, and the changes in owners’ equity other than net profit and loss, othercomprehensive income and profit distribution shall be carried forward into profit and loss on investments in the period ofthe acquiring date, except for other comprehensive income from the change caused by the remeasurement of the netliabilities or net assets of the defined benefit plan by the investee.In consolidated financial statements, when the Company disposes of part of long-term equity investment in the subsidiarybefore losing control rights, the difference between the disposal price and the long-term equity investment disposed ofrelative to the share of the net assets to be enjoyed and continuously calculated from the acquiring date or combinationdate is adjusted against capital premium or capital stock premium; if the capital reserve is not sufficient to absorb thedifference, the retained earnings shall be adjusted.When the Company loses the control right over the investee due to disposal of part of the equity investment or otherreasons, the residual equity shall be re-measured at its fair value on the date of losing the control right in preparing theconsolidated financial statements. The difference between the sum of the consideration acquired by disposal of the equityand the fair value of the residual equity, and the share of the net assets of the original subsidiary continuously calculatedfrom the acquiring day or combination date according to the original shareholding ratio, shall be included in the profit andloss on investments in the period of lose of the control right and written down against the goodwill. Other comprehensive
income related to the equity investment of the original subsidiary is transferred into the current profit and loss oninvestments in the period of loss of control right.
7. Joint venture arrangements classification and co-operation accounting treatment
The Company’s joint venture arrangements include cooperative enterprise.The investment in the cooperative enterprise is subject to the accounting treatment by the Company as the joint ventureparty according to the Accounting Standards for Business Enterprises No. 2 - Long-term Equity Investments.
8. Determining standards of cash and cash equivalents
The cash in the cash flow statement of the Company refers to the cash on hand and deposits readily available forpayment. The cash equivalents represent the short-term (no more than three months) and highly liquid investments thatare readily convertible into known amounts of cash and that are subject to an insignificant risk of change in value.
9. Foreign currency transaction and foreign currency statement translationThe foreign currency transaction of the Company is converted to Renminbi at the spot rate on the transaction date. Theforeign currency project, on the balance sheet date, is converted to Renminbi at the spot rate. The resulting converteddifference is included in current profit and loss except the balance of exchange of special foreign currency loan related toacquisition or construction of assets meeting the capitalization conditions. Non-monetary items in foreign currencymeasured at fair value are converted by the spot rate on the recognition date of the fair value. The difference between thebookkeeping currency amount after conversion and the original bookkeeping currency amount is recorded into the capitalreserve if belonging to non-monetary items in foreign currency of available-for-sale financial assets, or recorded intocurrent profit and loss if belonging to non-monetary items in foreign currency measured at fair value and with the changesincluded in current profit and loss. Non-monetary items in foreign currency measured by the historical cost are stillconverted by the spot rate on the transaction date without changing the RMB amount.The assets and liabilities in the balance sheet of a foreign operation are converted at the spot rate on the balance sheetdate; all items of owner’s equity, except the "undistributed profit", are converted at the spot rate at the time of occurrence.The income and expense items in the income statement of a foreign operation are converted at the approximateexchange rate of the spot rate on the date of transaction. The converted difference of the foreign currency financialstatements generated according to the above translation shall be presented in other comprehensive income. For a foreigncurrency monetary item which constitutes a net investment in overseas operations, the exchange difference resulting fromthe change of exchange rate shall be presented as other comprehensive income in the compilation of the consolidatedfinancial statements. Upon disposal of an overseas operation, other comprehensive income related to the overseasoperation shall be transferred to the current profit and loss according to the proportion.The approximate exchange rate of the spot exchange rate on the date of the cash flows shall be based on for thetranslation of cash flows in a foreign currency and in an overseas subsidiary. The effect of a change in exchange rate oncash shall be separately presented in the cash flow statement.
10. Financial instruments
The Company recognizes a financial asset or financial liability when becoming a party of the financial instrument contract.
Financial assetsClassification, recognition basis and measurement method for financial assetsAccording to the business model of managing financial assets and the contractual cash flow characteristics offinancial assets, the financial assets of the Company are classified into: financial assets measured at the amortizedcost; financial assets measured at fair value of which changes are recorded into other comprehensive income;financial assets at fair value through profit or loss (“FVTPL”).The financial asset of the Company that meets the following conditions simultaneously is classified as financial assetmeasured at the amortized cost: ① The business model for managing the financial asset is to collect contractualcash flows. ② According to the contract terms of the financial asset, the cash flow generated on a specific date isonly for the payment of the principal and the interest based on the outstanding principal amount. Such financial assetis initially measured at the fair value and the relevant transaction costs are charged to initially recognized amount;further measurement is made at the amortized cost. With the exception of the hedged item designated as such, thedifference between the initial amount and the amount due shall be amortized in accordance with the effective interestmethod, and the gains and losses arising from the amortization, impairment, exchange gains and losses and thederecognition shall be recorded into the current profit and loss.The financial asset of the Company that meets the following conditions simultaneously is classified as the financialasset measured at fair value of which changes are recorded into other comprehensive income: ① The businessmodel for managing such financial assets is to collect contractual cash flows and to sell the financial asset. ②According to the contract terms of the financial asset, the cash flow generated on a specific date is only for thepayment of the principal and the interest based on the outstanding principal amount. Such financial asset is initiallymeasured at the fair value and the relevant transaction costs are charged to initially recognized amount. With theexception of the hedged item designated as such, the other gains or losses incurred from such financial asset, exceptfor credit impairment losses or gains, exchange gains and losses and interest on the financial asset calculated byeffective interest method, shall be included in other comprehensive income; when the financial asset is derecognized,the accumulated gains or losses previously recorded in other comprehensive income should be transferred fromother comprehensive income in current profit and loss.The Company recognizes interest income by effective interest method. The interest income is determined bymultiplying the book balance of a financial asset by the effective interest rate, except as follows: ① For an acquiredor originated financial asset with credit impairment, the interest income shall be determined according to theamortized cost of the financial asset and the effective interest rate adjusted by credit from the initial recognition. ②For an acquired or originated financial asset with credit impairment, but which has credit impairment in thesubsequent period, the interest income of the financial asset shall be determined according to the amortized cost andthe effective interest rate of the financial asset in the subsequent period.The Company designates the non-transactional equity instruments as the financial assets measured at fair value ofwhich changes are recorded into other comprehensive income. Such designation, once made, shall not be revoked.The non-transactional equity instruments measured at fair value of which changes are recorded into othercomprehensive income are initially measured at the fair value and the relevant transaction costs are charged toinitially recognized amount; except for the dividends (excluding the part of investment cost recovery) recorded into thecurrent profit and loss, other related gains and losses (including exchange gains and losses) are recorded into othercomprehensive income and shall not be transferred into the current profit and loss subsequently. Upon derecognition,the accumulated gains or losses previously recorded in other comprehensive income should be transferred fromother comprehensive income to the retained earnings.The above financial assets measured at the amortized cost and the financial assets measured at fair value of which
changes are recorded into other comprehensive income are classified as financial assets at fair value through profitor loss (“FVTPL”). Such financial asset is initially measured at the fair value and the relevant transaction costs aredirectly charged to the current profit and loss. Gains or losses on such financial assets are charged to the currentprofit and loss.The financial assets recognized by the Company through business combination not under common control orconstituted by contingent consideration are classified as financial assets at fair value through profit or loss (“FVTPL”).Recognition basis and measurement method for transfer of financial assetsThe financial asset is derecognized when meeting any of the following conditions: ① The contract right to charge thecash flow of the financial asset is terminated; ② The financial asset has been transferred and almost all risks andremuneration of the financial asset ownership are transferred; ③ The financial asset has been transferred and theCompany does neither transfer nor retain almost all risks and remuneration of the financial asset ownership but givesup the control over the financial asset.If the overall transfer of the financial asset meets the derecognition conditions, the difference of the book value of thetransferred financial asset from the sum of the consideration received and the derecognized amount in the cumulativeamount of the fair value changes originally included in other comprehensive income (according to the contract termsof the financial asset transferred, the cash flow generated on a specific date is only for the payment of the principaland the interest based on the outstanding principal amount) is charged to the current profit and loss.If the partial transfer of the financial asset meets the derecognition conditions, the overall book value of thetransferred financial asset, between the derecognized part and non-derecognized part, is allocated according to therespective relative fair value. The difference of the sum of the consideration received from transfer and thederecognized amount in the cumulative amount of the fair value changes in the derecognized part originally includedin other comprehensive income (according to the contract terms of the financial asset transferred, the cash flowgenerated on a specific date is only for the payment of the principal and the interest based on the outstandingprincipal amount) from the overall book value of the above-mentioned financial asset allocated is charged to currentprofit and loss.Financial liabilitiesClassification, recognition basis and measurement method for financial liabilitiesFinancial liabilities, upon initial recognition, are divided into those measured with fair value and with the changesincluded in current profit and loss and other financial liabilities.Financial liabilities measured with fair value and with the changes included in current profit and loss, including thetrading financial liabilities and the financial liabilities measured with fair value and with the changes included in currentprofit and loss upon initial recognition. The financial liability is subsequently measured with the fair value. The gain orloss formed from the changes in the fair value as well as the dividends and interest expenditure related to thefinancial liability is charged to current profit and loss.The other financial liabilities are subsequently measured with the amortized cost by means of effective interestmethod. Except for the following items, the financial assets are classified as the financial liabilities measured atamortized cost: ① Financial liabilities measured with fair value and with the changes included in current profit andloss, including the trading financial liabilities (including derivative instruments belonging to financial liabilities) and thefinancial liabilities measured with fair value and with the changes included in current profit and loss. ② Financialliabilities formed by the transfer of financial assets not conforming to the derecognition conditions or by continuing toinvolve in the transferred financial assets. ③ Financial guarantee contracts that do not fall under the above ① or ②circumstances, and loan commitments to lend at a below-market rate that do not fall under the above ①
circumstance.The financial liabilities recognized by the Company as the acquirer through business combination not under commoncontrol or formed by contingent consideration are classified as financial liabilities at fair value through profit or loss foraccounting.Derecognition of financial liabilitiesThe Company derecognizes a financial liability (or part of it) only when the underlying present obligation (or part of it)is discharged. An agreement between the Company and a creditor to replace the existing financial liability with a newone with substantially different terms is accounted for as the derecognition of the existing financial liability and therecognition of a new financial liability. When the Company makes material alteration to the contract terms of theexisting financial liability (or part of it), it derecognizes the existing financial liability (or part of it) and recognizes a newone according to the altered terms. The difference between the book value of the derecognized part and theconsideration paid is charged to current profit and loss.Fair value determination method of financial assets and financial liabilitiesThe fair value of the financial assets and financial liabilities is measured by the Company at the prices in the principalmarket. If no principal market exists, the fair value is measured at the most favorable market price by valuationtechniques that are applicable at the time and are supported by sufficient data and other information available. Theinput value used in the fair value measurement is divided into three levels. That is, the input value of the first level isthe unadjusted quotation of the same assets or liabilities on the active market that can be obtained on themeasurement day. The input value of the second level is the direct or indirect observable input value of related assetsor liabilities other than the input value of the first level. The input value of the third level is the non-observable inputvalue of the relevant assets or liabilities. The Company prefers the input value of the first level and finally the inputvalue of the third level. The level of the measurement results of the fair value is determined by the lowest level of theinput value that is of great significance to the measurement of fair value as a whole.The Company measures the equity instrument investment at fair value. However, in limited cases, if the recentinformation used to determine the fair value is insufficient, or the possible estimated amount of the fair value is widelydistributed, and the cost represents the best estimate of the fair value within the range, the cost may represent theappropriate estimate of the fair value within the range.Offset of financial assets and financial liabilitiesThe financial assets and financial liabilities of the Company are listed respectively in the balance sheet and nomutually offset. However, when the following conditions are met at the same time, they are listed as net amount afteroffset in the balance sheet: (1) the Company has the legal right to offset the recognized amount and may execute thelegal right currently; (2) the Company plans to settle with net amount or realize the financial asset and pay off thefinancial liability simultaneously.Distinction between financial liabilities and equity instruments and relevant treatment methodThe Company distinguishes between a financial liability and an equity instrument in accordance with the followingprinciples :(1) If the Company cannot unconditionally avoid performing a contractual obligation by delivering cash orother financial assets, the contractual obligation is defined as a financial liability. Although some financial instrumentsdo not explicitly contain terms and conditions for the obligation to deliver cash or other financial assets, they mayindirectly form contractual obligations through other terms and conditions. (2) If a financial instrument is to be settledby or with the Company's equity instrument, it is necessary to consider whether the Company's equity instrumentused to settle the financial instrument is to be used as a substitute for cash or other financial assets or to give theholder of the instrument a residual equity in the assets of the issuer after deducting all liabilities. In the former case,
the financial instrument is a financial liability of the issuer; in the latter case, the instrument is the issuer’s equityinstrument. If it is stipulated in a financial instrument contract that the Company shall or may settle the financialinstrument by its own equity instruments in some cases, in which, the amount of the contractual rights or contractualobligations is equal to the number of its equity instruments available or to be delivered multiplied by its fair value atthe time of settlement, the contract is classified as a financial liability, whether the amount of the contractual rights orobligations is fixed or whether it is based in whole or in part on changes in variables (such as the interest rate, theprice of a commodity or the price of a financial instrument) other than the market price of the Company's equityinstruments.In classifying a financial instrument (or its components) in the consolidated statements, the Company takes intoaccount all terms and conditions agreed between the members of the Company and the financial instrument holder.The instrument shall be classified as a financial liability if the Company as a whole is obligated to deliver cash, otherfinancial assets, or settle accounts in other ways that cause the instrument to become a financial liability as a result ofthe instrument.The interest, dividends, profits or losses related to a financial instrument or its components classified as a financialliability, as well as gains or losses from redemption or refinancing, shall be recorded into the Company's current profitand loss.The issuance (including refinancing), repurchase, sales or cancellation of financial instrument or its componentsclassified as equity instruments is handled as the equity changes, and the fair value change of the equity instrumentsis not recognized.Impairment of financial instrumentsThe Company withdraws the provision for impairment for the financial assets measured at the amortized cost,financial assets measured at fair value of which changes are recorded into other comprehensive income, andfinancial guarantee contracts based on the expected credit loss, and recognizes the credit impairment loss.The expected credit loss refers to the weighted average credit loss of financial instruments weighted by the risk ofdefault. Credit loss refers to the difference between all contract cash flows discounted by the Company at the originaleffective interest rate and receivable according to the contract and all expected cash flows received, that is, thepresent value of all cash shortage. The financial assets purchased or originated that have suffered from creditimpairment shall be discounted at the effective interest rate of the financial assets through credit adjustment.The provision for loss on the accounts receivable from standard transactions in the income guidelines and notcontaining material financing elements shall be measured by the Company by simplified measurement according tothe amount equivalent to the expected credit loss in the whole duration.For the financial assets purchased or originated that have suffered from credit impairment, only the cumulativechanges of the expected credit loss in the whole duration upon initial recognition are recognized as provision for losson the balance sheet date. On each balance sheet date, the amount of change in the expected credit loss over theentire duration is recorded as an impairment loss or gain in the current period. Favorable changes in the expectedcredit loss are recognized as impairment gains even if the expected credit loss for the entire duration recognized onthe balance sheet date is less than the amount of overdue credit loss reflected in the estimated cash flow upon initialrecognition.For the financial assets other than those purchased or originated that have suffered from credit impairment bysimplified measurement, the Company shall evaluate whether the credit risk of relevant financial instrument hasincreased significantly upon initial recognition on each balance sheet date and measure its provision for loss andrecognize the expected credit losses and changes respectively in the following cases:
If the credit risk of the financial instrument has not increased significantly upon initial recognition and is in the firststage, its provision for loss is measured according to the amount equivalent to the expected credit loss of the financialinstrument in the next 12 months, and the interest income is calculated according to the book balance and theeffective interest rate.If the credit risk of the financial instrument has significantly increased without credit impairment upon initialrecognition and is in the second stage, its provision for loss is measured according to the amount equivalent to theexpected credit loss of the financial instrument in the whole duration, and the interest income is calculated accordingto the book balance and the effective interest rate.If the financial instrument has suffered from credit impairment upon initial recognition and is in the third stage, itsprovision for loss is measured according to the amount equivalent to the expected credit loss of the financialinstrument in the whole duration, and the interest income is calculated according to the amortized cost and theeffective interest rate.The amount increased or written back of the provision for credit loss of the financial instrument is recorded as animpairment loss or gain in the current period. Except for financial assets measured at fair value of which changes arerecorded into other comprehensive income, the book balance of financial assets is offset by the provision for creditlosses. For financial assets measured at fair value of which changes are recorded into other comprehensive income,the Company recognizes its provision for credit losses in other comprehensive income and does not reduce the bookvalue of the financial assets on the balance sheet.If the Company has measured the provision for loss in the previous accounting period according to the amountequivalent to the expected credit loss of the financial instrument in the whole duration but the credit risk of thefinancial instrument has no longer been increased significantly upon initial recognition on the current balance sheetdate, the Company shall measure the provision for loss on the financial instrument on the current balance sheet dateaccording to the amount equivalent to the expected credit loss in the next 12 months and the resulting amount writtenback from the provision for loss is recorded as an impairment gain in the current period.
①Significant increase in credit risk
By means of the reasonable and valid forward-looking information available, the Company determines whether thecredit risks of financial instruments have increased significantly upon initial recognition by comparing the default riskof the financial instruments on the balance sheet date with the default risk on the initial recognition date. For financialguarantee contracts, when the Company applies the impairment provisions on financial instruments, the date onwhich the Company becomes a party to make an irrevocable commitment shall be the initial recognition date. TheCompany will consider the following factors when assessing whether the credit risk has increased significantly:
whether there are significant changes in the actual or overdue operating results of the debtor; whether there has beena significant adverse change in the regulatory, economic or technical environment in which the debtor resides;whether there are significant changes in the value of collateral as collateral for debt or in the quality of guarantees orcredit enhancements provided by third parties, as well as the probability that these changes are expected to reducethe financial incentive for the debtor to repay on the terms specified in the contract or affect the breach of contract;whether there has been a significant change in the expected performance and repayment behavior of the debtor;whether the Company's credit management methods for financial instruments have changed.For a financial instrument with low credit risk on the balance sheet date, the Company assumes that the credit riskhas not increased significantly upon the initial recognition. The financial instrument is considered to have a low creditrisk if the financial instrument has relatively low default risk, and the borrower has a strong ability to fulfill itscontractual cash flow obligations in a short term, which will not necessarily reduced even if there are adversechanges in the economic situation and operating environment in a long term.
②Financial assets that have suffered from credit impairment
When one or more events occur that adversely affect the expected future cash flow of a financial asset, the financialasset becomes a financial asset with credit impairment. The evidence for credit impairment of financial assetsincludes: the debtor has incurred major financial difficulties; the debtor breaches a contract, such as by default orexceeding payment of default or late payment of interest or principal; the creditor gives the debtor concessions thathe would not make under any circumstances for economic or contractual reasons related to the debtor's financialdifficulties; the debtor is likely to go bankrupt or undergo other financial restructuring; the financial difficulties of theissuer or debtor cause the active market for the financial asset to disappear; a substantial discount at which afinancial asset is purchased or originated reflects the fact of credit loss.The credit impairment of the financial asset may be caused by the joint action of the above events, and may notnecessarily be caused by the events that can be identified separately.
③Determination of expected credit loss
The Company evaluates the expected credit losses of financial instruments on the basis of individual and combinedinstruments, and in assessing the expected credit losses, takes into account reasonable and valid information aboutpast events, current conditions and projections of future economic conditions.Based on the characteristics of common credit risks, the Company divides financial instruments into differentcombinations. The individual assessment standards and the characteristics of the combination credit risks of relevantfinancial instruments are detailed in the accounting policies of relevant financial instruments.The Company shall determine the expected credit losses of the relevant financial instruments in the following ways:
In the case of a financial asset, the credit loss is the present value of the difference between the contract cash flowreceivable by the Company and the expected cash flow receivable;In the case of a financial guarantee contract, the credit loss is the present value of the difference between theestimated amount of payment to be made by the Company in respect of any credit loss incurred under the contract,and the amount that the Company expects to receive from the contract holder, debtor or anywhere else;In the case of a financial asset with credit impairment on the balance sheet date but not purchased or originated withcredit impairment, the credit loss is the difference between the book balance of the financial asset and the presentvalue of the estimated future cash flow discounted at the original effective interest rate.
11. Notes receivable
Based on the acceptor credit risk of notes receivable as a common risk feature, the Company divides thenotes receivable into different combinations and determines the expected credit loss accounting estimationpolicy:
| Combination classification | Basis for recognition of combination | Accrual method |
| Banker's acceptance bill combination | The acceptor is a banking financial institution | The Company believes that the banker's acceptance bill held does not have significant credit risk and will not cause major losses due to bank default. |
| Commercial acceptance bill combination | The acceptor is a financial company or other non-bank financial institution or enterprise | The Company measures the provision for bad debt of commercial acceptance bills receivable according to the expected credit loss of the entire duration |
12. Accounts receivable
The provision for loss on the accounts receivable (whether or containing material financing elements) from standardtransactions in the Accounting Standards for Enterprises No.14 - Revenues and on the lease receivables regulated in theAccounting Standards for Enterprises No. 21 - Lease shall be measured by the Company by simplified measurementaccording to the amount equivalent to the expected credit loss in the whole duration.The Company shall evaluate whether the credit risks of accounts receivable have increased significantly on the basis of asingle financial instrument or a financial instrument combination. The Company makes single assessment of the creditrisks for the accounts receivable with significantly different credit risks and the following features: accounts receivable indispute with the other party or involving litigation or arbitration; accounts receivable with obvious signs that the debtor islikely to be unable to perform the repayment obligations. It is feasible for the Company to evaluate whether the credit risksincrease significantly on the basis of financial instrument combination if it is unable to obtain sufficient evidence forsignificant increase in credit risks at reasonable cost at the level of single financial instrument. The Company can classifyfinancial instruments based on the characteristics of common credit risk in assessment based on the financial instrumentcombination.The Company divides the accounts receivable into the following combinations based on their credit risk characteristics:
unitCombination classification
| Combination classification | Basis for recognition of combination | Accrual method |
| Credit loss withdrawn on accounts receivable by aging analysis method | The receivables with the same aging have similar credit risk characteristics | Expected credit loss rate |
| Related parties in the consolidation scope | Funds of subsidiaries in the consolidation scope of controlling shareholders | Generally no expected credit loss |
If there is objective evidence that a credit impairment has occurred in an account receivable, the Companyshall withdraw the provision for bad debts for that account receivable and recognize the expected credit loss.For the accounts receivable with the credit loss drawn by aging analysis method, based on the actual credit losses of theprevious year and taking into account the forward-looking information of the current year, the Company's accountingestimation policy for measuring expected credit losses is as follows:
| Aging | Expected credit loss rate |
| Within 1 year | 5.00% |
| 1-2 years | 10.00% |
| 2-3 years | 20.00% |
| 3-4 years | 50.00% |
| 4-5 years | 80.00% |
| More than 5 years | 100.00% |
The Company shall calculate the expected credit loss of the accounts receivable on the balance sheet date. If theexpected credit loss is greater than the book amount of the provision for impairment of current accounts receivable, theCompany recognizes the difference as the provision for impairment of accounts receivable, debits the "impairment loss"and credits the "provision for bad debt". On the contrary, the Company recognizes the difference as an impairment gain
and records the opposite.Where the Company has actually incurred a credit loss and the relevant accounts receivable are determined to beirrecoverable, and the write-off is approved, the "provision for bad debt" shall be debited and the "accounts receivable"shall be credited according to the approved write-off amount. If the write-off amount is greater than the provision for losswhich has been calculated, the "credit impairment loss" shall be debited for the difference on schedule.
13. Receivables financing
The financial asset of the Company that meets the following conditions simultaneously is classified as the financial assetmeasured at fair value of which changes are recorded into other comprehensive income: the business model formanaging such financial assets is to collect contractual cash flows and to sell the financial asset; according to the contractterms of the financial asset, the cash flow generated on a specific date is only for the payment of the principal and theinterest based on the outstanding principal amount.The Company transfers the accounts receivable held in the form of discount or endorsement. Such accounts receivablewith frequent business and large amount involved are measured at fair value of which changes are recorded into othercomprehensive income according to relevant regulations in the financial instrument standards if the managementbusiness model is to collect and sell contractual cash flows.
14. Other receivables
Recognition and accounting method for expected credit loss of other receivablesThe Company divides the process of credit impairment of other receivables into three stages, and has different accountingtreatment methods for other receivables impairment in different stages: the credit risks has not increased significantlyupon initial recognition (first stage). For the financial instruments in this stage, the Company should measure the provisionfor loss according to the expected credit loss over the next 12 months. The Company takes aging as the credit riskcharacteristic to group other receivables and measures them on the basis of combination, which is equivalent to theexpected credit loss in the next 12 months. The credit risk has significantly increased without credit impairment upon initialrecognition (second stage). For the financial instruments in this stage, the Company should measure the provision for lossaccording to the expected credit loss in the whole duration. Credit impairment occurs upon initial recognition (third stage).For the financial instruments in this stage, the Company should measure the provision for loss according to the expectedcredit loss in the whole duration.
15. Inventory
The Company's inventory mainly includes low priced and easily worn articles, raw materials, work in process,merchandise inventory and goods shipped in transit.The perpetual inventory system is adopted for the inventories and the inventories are price according to the actual costwhen obtained; the cost of the inventories is recognized by the weighted average method when received or issued. Thelow priced and easily worn articles and packages are amortized by one-time writing-off method.The year-end inventory is priced according to the cost of inventories or net realizable value, whichever is lower. In case ofinventory damage, full or partial obsolescence or selling price below the cost, the non-recoverable part of its cost isexpected and the inventory falling price reserves are withdrawn. The inventory falling price reserves of the merchandiseinventory and raw materials are withdrawn according to the difference between the cost of a single inventory item and its
net realizable value; for the inventories with large quantity and low unit price, the inventory falling price reserves arewithdrawn according to the inventory category.For the merchandise inventory, work in process, materials for sale and other merchandise inventories directly used forsale, the net realizable value is recognized by the amount of the estimated sale price of the inventories subtracted by theestimated selling expenses and related taxes; for the material inventory possessed for production, the net realizable valueis recognized by the amount of the estimated sale price of the finished products subtracted by the estimated cost about tooccur in completion, estimated selling expenses and related taxes.
16. Contract assets
17. Contract cost
18. Assets held for sales
19. Debt investments
20. Other debt investments
21. Long-term receivables
22. Long-term equity investments
The Company's long-term equity investment mainly consists of investment in subsidiaries, joint ventures and cooperativeenterprises.The Company's judgment on common control is based on the collective control of the arrangement by all participants or acombination of participants, and the policy on the activities related to the arrangement must be agreed upon by allparticipants in the collective control of the arrangement.When the Company directly or indirectly owns more than 20% (including) but less than 50% voting rights of the investeethrough its subsidiaries, it is generally considered to have a significant impact on the investee. When the Company ownsless than 20% voting rights of the investee, it shall be judged to have a significant impact on the investee withcomprehensive consideration to dispatching representatives in the board of directors of the investee or similar authority,participating in the formulation process of the financial and business policy of the investee, conducting importanttransactions with the investee, dispatching management to the investee or providing key technical data for the investee.The company that forms control over the investee shall be a subsidiary of the Company. For the long-term equityinvestment acquired through business combination under common control, the share of the book value of the net assetsof the combined party in the consolidated statements of the final controlling party, on the combination date, is regarded asthe initial cost of the long-term equity investment. If the book value of the net assets of the combined party on thecombination date is negative, the long-term equity investment cost shall be determined as zero.If the Company acquires the equity of the investee under common control by steps through several deals, finally formsbusiness combination and such deals belong to package deal, the deals shall be subject to accounting treatment as adeal to obtain the control right. If the deals do not belong to the package deal, the share of the book value of the net assetsof the combined party in the consolidated financial statements of the final controlling party, on the combination date, is
regarded as the initial cost of the long-term equity investment. The difference between the initial cost of the long-termequity investment and the sum of the book value of the long-term equity investment before the combination plus the bookvalue of the new consideration for shares on the combination date is adjusted against capital reserve; if the capital reserveis not sufficient to absorb the difference, the retained earnings shall be written down.For the long-term equity investment acquired through business combination not under common control, the combinedcost is the initial investment cost.If the Company acquires the equity of the investee not under common control by steps through several deals, finally formsbusiness combination and such deals belong to package deal, the deals shall be subject to accounting treatment as adeal to obtain the control right. If the deals do not belong to the package deal, the sum of the book value of the equityinvestment originally held and newly increased investment cost shall be considered as initial cost of the investment thatcalculates according to cost method. If the equity held before the acquiring date is calculated by the equity method, othercomprehensive income calculated by the equity method is not adjusted and shall be subject to accounting treatment whendisposing of the investment through adopting the basis for the direct disposal of relevant assets or liabilities of theinvestee. If the original equity held before the acquiring date is calculated at fair value in the available-for-sale financialassets, the change in the cumulative fair value originally included in other comprehensive income is transferred to thecurrent investment profit and loss on the combination date.Except for the long-term equity investment acquired through business combination, for the long-term equity investmentmade by paying cash, the investment cost shall be the purchase price actually paid; for the long-term equity investmentacquired by issuing equity securities, the investment cost shall be the fair value of the equity securities issued; for thelong-term equity investment acquired through the exchange of non-monetary assets, the initial investment cost shall berecognized in accordance with the relevant provisions of the Accounting Standards for Business Enterprises No.7 -Exchange of Non-monetary Assets; for the long-term equity investment acquired by debt restructuring, the initialinvestment cost shall be recognized in accordance with the relevant provisions of the Accounting Standards for BusinessEnterprises No.12 - Debt Restructuring.The investment in subsidiaries is measured by the cost method and the investment in joint ventures and cooperativeenterprises is measured by equity method.For the long-term equity investment calculated by cost method subsequently, the long-term equity investment cost isadjusted when the investment is added or recovered. The cash dividends or profits declared to be distributed by theinvestee should be recognized as current investment income.The book value of the long-term equity investment measured subsequently by equity method shall be increased ordecreased with the change in the owner’s equity of the investee. The share of the net profits and losses of the investee tobe enjoyed shall be recognized after offsetting of the part of the internal deal profits and losses attributable to theCompany between the joint venture and cooperative enterprise according to the shareholding ratio and after adjustment ofthe new profits of the investee on the basis of the fair value of the identifiable assets of the investee when the investmentis obtained and according to the Company’s accounting policy and accounting period.In disposal of the long-term equity investment, the balance between the book value and the actual price obtained ischarged to current investment income. If a long-term equity investment calculated by the equity method is included in theowner's equity due to changes in the owner's equity other than the net profit and loss of the investee, the part originallyincluded in the owner's equity in the disposal of the investment shall be transferred to the current investment profit andloss by the corresponding proportion.If the deals for disposal of the equity by steps until the loss of the control right do not belong to the package deal, eachdeal shall be subject to accounting treatment respectively. If they belong to a package deal, the deals shall be subject to
accounting treatment as a deal for disposal of subsidiary and loss of the control right; however, the difference betweeneach disposal price and the book value of the long-term equity investment corresponding to the equity disposed of beforethe loss of control right is recognized as other comprehensive income and then transferred into the current profit and lossin the period of loss of control right.
23. Investment properties
Measurement mode of investment propertiesCost methodMethod of depreciation or amortizationThe Company’s investment properties include the leased buildings which are measured by cost model.The Company's investment properties are depreciated or amortized by the straight-line depreciation method. Theestimated service life, net residual rate and yearly depreciation (amortization) ratio of all types of investment propertiesare as follows:
| Category | Depreciation life (year) | Expected residual rate (%) | Yearly depreciation (%) |
| Houses and buildings | 20 years | 5.00% | 4.75% |
24. Fixed assets
(1) Recognition conditions
The Company’s fixed assets refer to the tangible assets with the following features which are held for production of goods,provision of labor, lease (excluding lease of buildings) or operating management and whose service life exceeds year.The fixed assets can be recognized when the economic benefits related to the fixed assets are likely to flow to theCompany and when the cost of the fixed assets can be reliably measured. The fixed assets, including buildings,machinery equipment, transportation equipment and other equipment, are entered into the account by actual cost whenobtained, in which, the cost of purchased fixed assets includes buying price, import tariff and other relevant taxes, as wellas other expenses incurred before the fixed assets reach the extended usable status and directly attributable to the assets;cost of self-constructed fixed assets, consisting of necessary expenses incurred from construction of the asset to theintended serviceable conditions; the cost invested by the investors in the fixed assets is determined according to the valuestipulated in the investment contracts or agreements, except the value stipulated in the contracts or agreements is not fair;the fixed assets under financing lease shall be recorded in the accounts according to the lower present value between thefair value of the leased asset on the lease commencement date and the minimum lease payment.Except the fixed assets withdrawn with depreciation and remaining use, the Company withdraws depreciation of all fixedassets by the straight-line depreciation method. According to the category of fixed assets, estimated economic life andexpected net residual rate, the depreciation is determined.Accounting treatment of subsequent expenditure of fixed assets: subsequent expenditure of fixed assets mainly includesthe transformation and renovation expenses and repair expenses. If the economic benefits related may flow in and thecost can be reliably measured, the subsequent expenditure is included in the fixed asset cost and the book value of thereplaced part is derecognized. The other subsequent expenditure is charged to current profit and loss upon occurrence.The Company shall review the service life, estimated residual value and depreciation method of the fixed assets on each
balance sheet date and handle any change as the accounting estimate change.When the fixed assets are disposed of or cannot generate economic benefits through expected use or disposal, the fixedassets are derecognized. The income from sale, transfer, scrap or damage disposal of fixed assets is included in currentprofits and losses after deducting the book value and related taxes.
(2) Depreciation method
| Category | Depreciation method | Depreciation life | Residual rate | Yearly depreciation |
| Houses and buildings | Straight-line method | 20 | 5.00% | 4.75% |
| Machinery equipment | Straight-line method | 10 | 5.00% | 9.50% |
| Transportation equipment | Straight-line method | 5 | 5.00% | 19.00% |
| Other equipment | Straight-line method | 5 | 5.00% | 19.00% |
(3) Recognition basis, valuation and depreciation methods of fixed assets under financing lease
25. Construction in progress
The construction in progress is measured according to the actual cost. The self-run construction shall be measured bydirect materials, direct wages and direct construction costs; the outsourced construction shall be measured according tothe paid project cost; the equipment installation project cost shall be determined according to the value, installation costand test run expenses of the equipment installed. The cost of the construction in progress should also include thecapitalized borrowing costs.The fixed assets of the construction shall be carried forward to the fixed assets by the estimated value according to theconstruction budget, cost or actual construction cost from the date when they reach the intended usable state, and thedepreciation shall be calculated and withdrawn from the following month. The original value difference of the fixed assetsis adjusted after the completion settlement procedures.
26. Borrowing costs
Recognition principle of capitalization of borrowing costs: the construction or production borrowing costs incurred anddirectly attributable to the assets meeting the capitalization conditions are capitalized and charged to relevant asset costs;other borrowing costs shall be recognized as costs according to the amount incurred when they occur and shall beincluded in the current profit and loss. Assets meeting the capitalization conditions refer to the fixed assets, intangibleassets, inventories and other assets which can reach the intended usable or marketable status only after quite a long time(generally more than 1 year) of construction or production activities.Capitalization period of borrowing costs: the borrowing costs related to the assets that meet the capitalization conditionsstart to be capitalized when the expenditure to acquire and the borrowing costs have occurred and the construction orproduction activities required to make the assets reach the usable or marketable status have started. In case of abnormalinterrupt of the assets meeting the capitalization conditions for more than 3 consecutive months in the construction orproduction process, the capitalization of the borrowing costs is suspended; the borrowing costs stop capitalization when
the construction or production assets meeting the capitalization conditions reach the usable or marketable status.Calculation method for capitalized amount of borrowing costs: when special borrowings are borrowed for construction orproduction of the assets meeting the capitalization conditions, the difference between the interest incurred in the period ofspecial borrowings and the interest income from the unused borrowing fund in the bank or the investment income oftemporary investment is deemed as the capitalized amount of the interest on the special borrowings. When generalborrowings are occupied for construction or production of assets meeting the capitalized conditions, the weighted averageof the expenditure to acquire exceeding the special borrowings in the cumulative expenditure to acquire is multiplied bythe weighted average interest rate of the general borrowings occupied to calculate and determine the amount of interest tobe capitalized on the general borrowings.
27. Biological assets
28. Oil and gas assets
29. Right-of-use assets
30. Intangible assets
(1) Valuation method, service life and impairment test
The Company's intangible assets mainly include land use rights, software, trademarks, patents, etc. The actual cost of thepurchased intangible assets shall be the actual cost and other relevant expenses. The actual cost of the intangible assetsinvested by the investors is determined according to the value stipulated in the investment contracts or agreements. If thevalue stipulated in the contracts or agreements is not fair, the actual cost is determined according to the fair value. Theintangible assets are amortized by the straight-line method. The classification and amortization period of the Company'sintangible assets are as follows:
| Category | Amortization period |
| Land use right | 50 years |
| Patent | 10 years |
| Software | 3-5 years |
| Trademark and domain name | 10 years |
The Company’s land use right is amortized averagely according to the transfer life from the date of transfer; theCompany's patent right, non-patented technology, the right to use the special software and other intangible assets areamortized averagely by the shortest of the estimated service life, the beneficial life stipulated in the contract and theeffective life stipulated by law. The amortization amount shall be recorded into the current profit and loss or the cost ofrelated assets according to its beneficiary object.The expected useful life and amortization methods of the intangible assets with limited useful life are reviewed at the endof each year and adjusted accordingly in case of change; the expected useful life of the intangible assets with uncertainuseful life are reviewed in each accounting period. If there is evidence that the service life of intangible assets is limited,the service life shall be estimated and amortized within the expected useful life.The expenditure of the Company's internal R&D projects is classified into the expenditure at the research stage and theexpenditure at the development stage according to its nature and great uncertainty of the intangible assets eventuallyformed by R&D activities.
The expenditure of the self-developed intangible assets at the research stage are accounted into the current profits andlosses in occurrence; the expenditure at the development stage is recognized as assets only when meeting all of thefollowing conditions: technically feasible to complete the intangible assets, so that they can be used or sold; it is intendedto finish and use or sell the intangible assets; the products generated by the intangible assets can be sold or the intangibleassets themselves can be sold; it is able to finish the development of the intangible assets, and able to use or sell theintangible assets, with the support of sufficient technologies, financial resources and other resources; and thedevelopment expenditures of the intangible assets can be reliably measured.The expenses at the development stage not meeting above conditions are included in current profits and losses whenobtained. The development expenses included in profits and losses in previous periods are not recognized as assets insubsequent periods. The capitalized expenses at the development stage are listed as development expenses in thebalance sheet and transferred to intangible assets when the project reaches the intended usable state.If the expenditure at the research stage and the expenditure at the development stage cannot be distinguished, the R&Dexpenditure incurred is fully charged to the current profit and loss. The cost of intangible assets formed by internaldevelopment activities consists only of the total expenditure incurred between the point at which the conditions forcapitalization are met and the time at which the intangible assets reach their intended use. The expenditure that has beenexpensed and included in the profit and loss for the same intangible asset before reaching the capitalization conditions inthe development process is no longer adjusted.
(2) Accounting policy of expenditure for internal research and development
31. Long-term assets impairment
The Company checks the intangible assets determined for the long-term equity investment, fixed assets, construction inprogress and service life of the subsidiaries, joint ventures and cooperative enterprises on each balance sheet date.When there are the following signs, indicating that the assets may be impaired, the Company will conduct impairment test;for intangible assets with uncertain goodwill and beneficial life, impairment test shall be conducted at the end of each yearwhether there is any sign of impairment or not. Where it is difficult to test the recoverable amount of a single asset, the testshall be based on the asset group or the combination of asset groups to which the asset belongs. After the impairment test,if the book value of the asset exceeds the recoverable amount, the difference is recognized as an impairment loss. Oncethe impairment loss of the said asset is recognized, it will not be carried back in the subsequent accounting period. Therecoverable amount of an asset is the higher of the net amount of the assets fair value subtracted by the disposal costsand the present value of the expected future cash flow of the assets.The signs of impairment are as follows: the market price of an asset falls sharply in the current period, which issignificantly higher than the expected decline due to the passage of time or normal use; the economic, technical or legalenvironment in which an enterprise operates and the market in which its asset is located will undergo major changes inthe current period or in the near future, thereby adversely affecting the enterprise; the market interest rate or the rate ofreturn on investment in other markets has been increased in the current period, thus affecting the discount rate of theenterprise in calculating the present value of the expected future cash flow of the asset, resulting in a significant reductionin the recoverable amount of asset; there is evidence that the asset is obsolete or that the entity has been damaged; theasset has been or will be idle, terminated or disposed of ahead of schedule; the evidence from internal reporting indicatesthat the economic performance of the asset has been or will be lower than expected. For example, the net cash flowcreated by the asset or the realized operating profit (or loss) is much lower than (or higher than) the estimated amount;other signs that the asset may have been impaired.
32. Long-term unamortized expenses
The long-term unamortized expenses of the Company refer to the expenses that have been paid, but should be borne inthe current period and subsequent periods with the amortization period of more than one year (excluding one year). Suchexpenses are amortized on average in the benefit period. If a long-term unamortized expense item cannot benefit a lateraccounting period, the amortized value of the item that has not been amortized is transferred to the current profit and loss.
33. Contract liabilities
34. Employee compensation
(1) Short-term compensation accounting method
The Company’s employee compensation includes short-term compensation, welfare after dismission, dismission welfareand other long-term employee services and benefits.The short-term compensation mainly includes salary, bonus, allowances and subsidies, employee services and benefits,housing fund, labor union expenditure and personnel education fund, medical insurance premiums, industrial injuryinsurance premium, birth insurance premium and other social insurance premiums. The short-term compensation actuallyhappened during the accounting period when the staff offering the service for the Company shall be recognized asliabilities and included in the current gains and losses or relevant assets cost by the beneficiary object.
(2) Post-employment benefits accounting method
Post-employment benefits mainly include basic endowment insurance, unemployment insurance and enterprise annuitypayment and are classified as defined contribution plans according to the risks and obligations undertaken by theCompany. The sinking funds made to a separate entity on the balance sheet date in exchange for services rendered bythe employee during the accounting period shall be recognized as liabilities and included in the current gains and lossesor relevant assets cost by the beneficiary object.
(3) Termination benefits accounting method
The Company puts forward compensation for an employee to terminate the labor relationship with the employee beforeexpiry of the employee labor contract. When failing to unilaterally withdraw the dismission welfare due to termination oflabor relation plan or downsizing suggestions, or when recognizing the costs related to restructuring involving payment ofdimission welfare (whichever comes first), the Company recognizes the employee compensation liabilities from thedismission welfare and includes in current profit and loss. The compensation that is paid beyond a year is included incurrent profit and loss after discount.
(4) Other long-term employee benefits accounting method
Other long-term employee benefits mainly include the long-term incentive plan and long-term benefits and shall be subjectto the accounting treatment according to relevant provisions in the defined contribution plans.
35. Lease liabilities
36. Estimated liabilities
Any business related to contingencies such as external guarantee, pending litigation or arbitration, product qualityassurance, staff reduction plan, loss contract, restructuring obligation, environmental pollution remediation, commitmentand fixed asset disposal obligation, if meeting all of the following conditions, is recognized as a liability: the obligation isthe current obligation undertaken by the Company; performance of the obligation is likely to lead to the outflow ofeconomic benefits; the amount of the obligation can be reliably measured.The estimated liabilities are initially recognized according to the best estimate number of the expenditure required toperform relevant current obligations with consideration to the contingency related risks, uncertainty, time value of moneyand other factors. If the time value of money has significant impact, the best estimate number is determined after discountof the future cash flow. The book value of the estimated liabilities is reviewed on the balance sheet date and adjusted toreflect the current best estimate number if there is any change.The existence of a potential obligation for past transactions or events shall be substantiated by the occurrence ornon-occurrence of future uncertainties; the Company will disclose the potential or current obligation a as contingentliability if the performance of such obligation is not likely to result in the outflow of economic benefits from the Company orif the amount of such obligation cannot be reliably measured.
37. Share-based payment
The term share-based payment refers to a transaction in which the Company grants equity instruments or undertakesequity-instrument-based liabilities in return for services from employee or other parties. The share-based payments shallconsist of equity-settled share-based payments and cash-settled share-based payments.The equity-settled share-based payment in return for employee services is measured at the fair value of the equityinstruments granted to the employees. The amount of such fair value, under the situation that the rights can only beexercised after the service is finished and the set performance is achieved within the waiting period, and basing on theoptimum estimation for the number of equity instrument which exercise rights within the waiting period, will be measuredaccording to straight-line method and counted into relevant costs and expenses. The capital reserve will be increasedcorrespondingly.The share-based payment settled by cash will be measured according to the fair value of the liability confirmed basing onthe shares borne by the Company and other equity instruments. If the rights can be exercised immediately after beinggranted, the payment will be counted into relevant costs or expenses at the fair value of the liabilities assumed and theliability will be increased correspondingly. If the rights can only be exercised after the situation that service within thewaiting period is completed and set performance is achieved, the service obtained at the current period, according to thefair value amount of the liability borne by the Company, and basing on the optimum estimation for the condition ofexercising rights, will be counted into costs or expenses on each and every balance sheet date during the waiting period,and the liability will be increased correspondingly.Each and every balance sheet date and settlement before relevant liability settlement, the fair value of liability will beremeasured, of which changes occurred will be counted into the current period.
38. Preferred shares, perpetual bonds and other financial instruments
39. Income
Whether new income standards have been implemented
√Yes □ No
Accounting policies for income recognition and measurementThe Company’s operating income mainly includes income from selling commodities, income from offering labor andtransfer of asset use right. Relevant income is recognized when the economic benefits associated with the transaction canflow to the Company and relevant income can be measured reliably and meets the specific income recognition standardsfor the following operating activities.Income from selling commodities: the income from sale of goods can be recognized only meeting the following conditions:
the Company has transferred the main risks and rewards on the property in the goods to the buyer; the Company neitherretains the right to continue to manage related to the property, nor effectively controls goods that have been sold; theincome amount can be measured reliably; related economic benefits are likely to flow to the Company; the costs related,incurred or to be incurred can be measured reliably. Agency mode: according to the commission sales contract signed bythe Company and the regional agency, the Company shall recognize the income after receiving the consignment sale listor sales list summary sheet from the agency; E-commerce: after the customer places an order, the Company will deliverthe goods and receive the payment. The Company recognizes the income according to the time of receipt confirmationand order completion (when the customer confirms receipt on the platform or automatically confirms receipt within 7 days);b. The platform shall be responsible for delivery and collection of payment, and the Company shall settle and recognizethe income according to the sales list provided by the platform; TV shopping: TV shopping platform informs the Companyof delivery according to the customer order, and the Company recognizes the income according to the sales list providedby TV shopping platform; project type: deliver goods according to the customer order, the Company recognizes theincome according to the receipt form after the customer receives goods; export revenue from customs declaration: therevenue is recognized according to the export date on the customs declaration.Income from offering labor: The Company recognizes the income from offering labor at the balance sheet date with thepercentage of completion method when the results of the labor transactions can be estimated reliably. The completionschedule of the labor transaction is recognized according to the proportion of the costs incurred in the total estimatedcosts. The results of the labor transactions can be estimated reliably when: ① the income amount can be measuredreliably; ② related economic benefits are likely to flow to the Company; the completion schedule of the labor transactionscan be recognized reliably; and ④ the costs incurred or to be incurred in the transactions can be measured reliably. If theresults of the labor transactions cannot be estimated reliably, the income from offering labor is recognized according to thelabor cost amount incurred and expected to be compensated, and the labor cost incurred is considered as currentexpenses. If the labor cost incurred is expected not to be compensated, the income is not recognized. If the part of sellingcommodities and the part of offering labor can be distinguished and independently measured when the contract oragreement signed by the Company with other enterprises includes selling commodities and offering labor, the two partsshall be disposed of respectively; if they cannot be distinguished, or if they can be distinguished but cannot beindependently measured, the contract shall be fully treated as the part of selling commodities.
40. Government subsidies
The Company's government subsidies include financial allocations. The asset related government subsidies refer to thegovernment subsidies obtained by the Company and used for acquisition or construction or for formation of long-term
assets in other ways; the income related government subsidies refer to the government subsidies other than the assetrelated government subsidies. The government subsidies without subsidy objects specified in government documentsshall be judged by the Company according to the above principle, or classified into income related government subsidiesas a whole if it is difficult to judge.The government subsidies as the monetary assets are measured according to the amount received. For subsidiesallocated in accordance with fixed quota standards, or if there is evidence at the end of year that the Company can meetrelevant conditions stipulated in the financial support policy and can be expected to receive the financial support fund, thegovernment subsidies are measured according to receivables. The government subsidies not as the monetary assets aremeasured according to the fair value, or measured according to the nominal amount (RMB 1 yuan) if the fair value cannotbe obtained reliably.The government subsidies related to assets are recognized as deferred income and equally distributed and charged to thecurrent profit and loss in the service life of relevant assets.If the related asset is sold, transferred, scrapped or damaged before the end of the useful life, the deferred incomebalance not yet distributed is transferred in the profits and losses in the period of assets disposal.The income related government subsidies, if used to compensate for related costs or losses in subsequent periods, arerecognized as the deferred income and charged to the current profit and loss when related costs or losses are recognized.The government subsidies pertinent to the daily activities of the Company shall be included in other income or used tooffset relevant costs and expenses according to the substance of the economic business. The government subsidiesirrelevant with the daily activities of the Company shall be included in non-operating revenues and expenditures.Where the Company has obtained discount interest on preferential loans, it shall distinguish between the two situations inwhich the financial department allocates discount interest funds to the lending bank and the financial department directlyallocates discount interest funds to the Company, and conduct accounting treatment according to the following principles:
(1) Where the financial department allocates the discount interest funds to the lending bank, and the lending bankprovides the loan to the Company at the preferential policy interest rate, the Company shall take the actual amount of theloan received as the entry value of the loan, and calculate the relevant borrowing costs according to the loan principal andthe preferential policy interest rate.
(2) Where the financial department directly allocates discount interest funds to the Company, the Company will write downthe corresponding discount interest against the relevant borrowing costs.If the government subsidy confirmed by the Company needs to be returned, the accounting treatment shall be carried outin accordance with the following provisions in the current situation of the return:
1) The book value of related assets is adjusted if it is offset upon initial recognition.
2) For those with related deferred income, the book balance of related deferred income is written down and the excess isaccounted into the current profits and losses.
3) In the other cases, they are directly accounted into the current profits and losses.
41. Deferred income tax assets and deferred income tax liabilities
The Company’s deferred income tax assets and deferred income tax liabilities are calculated and recognized according tothe difference (temporary difference) between the tax base and book value of the assets and liabilities. For thedeductible loss that can be carried forward to the subsequent year according to the tax law, the corresponding deferredincome tax assets are recognized. For the deductible temporary differences related to the initial recognition of the goodwill,the corresponding deferred income tax liabilities are not recognized. For the temporary differences related to the initial
recognition of the assets or liabilities incurred in the transaction not for business combination that will not affect theaccounting profits and income tax payable (or deductible loss), the corresponding deferred income tax assets andliabilities are not recognized. The deferred income tax assets and deferred income tax liabilities are measured on thebalance sheet date according to the applicable tax rate in the period of expected recovery of relevant assets of liquidationof relevant liabilities.The Company recognizes the deferred income tax assets by deductible temporary differences, within the limit of theincome tax payable that may be obtained in the future and used to offset the deductible temporary differences, thedeductible loss and tax deduction.
42. Lease
(1) Accounting treatment method of operating lease
Finance lease is the lease substantially transferring all risks and remuneration related to the asset ownership. The leaseother than the finance lease is operating lease. The Company’s lease is mainly operating lease.The rental income or expense of operating lease is charged to relevant asset cost or current profit and loss by thestraight-line method in the lease term.
(2) Accounting treatment method of finance lease
43. Other significant accounting policy and accounting estimate
44. Significant accounting policy and accounting estimate change
(1) Changes in significant accounting policies
| Content and reasons of changes in accounting policies | Approval procedures | Remark |
| The Ministry of Finance issued the revised Accounting Standards for Business Enterprises No.22 - Recognition and Measurement of Financial Instruments, Accounting Standards for Business Enterprises No.23 - Transfer of Financial Assets, Accounting Standards for Business Enterprises No.24 - Hedging and Accounting Standards for Business Enterprises No.37 - Presentation of Financial Instruments (collectively referred to as the “new financial instrument standards”) in 2017. The Company implements the new financial instrument standards from January 1, 2019 | Approval at the Company’s 10th meeting of the 4th Board of Directors | See the instructions |
| The Ministry of Finance issued the Notice of the Ministry of Finance on Revising and Issuing the Format of Financial Statements for Ordinary Enterprises in 2019 (CK [2019] No.6) in April 2019, and the Notice of the Ministry of Finance on Revising and Issuing the Format of Financial Statements for Ordinary Enterprises in 2018 (CK [2018] No. 15) issued on June 2018 was abolished simultaneously; the Ministry of Finance issued the Notice of the Ministry of Finance on Revising and Issuing the Format of Consolidated Financial Statements (2019) [CK [2019] No.16) in September | Approval at the Company’s 12th meeting of the 4th Board of Directors | See the instructions |
Instructions for use:
1) According to the connection between the old and new standards, the Company implemented the newfinancial instrument standards from January 1, 2019, and adopted the retroactive adjustment method tochange the presentation of relevant financial statements. See "IV. 31.(3)" in this note for details;
2) According to the Notice of the Ministry of Finance on Revising and Issuing the Format of FinancialStatements for Ordinary Enterprises in 2019 (CK [2019] No.6) and the Notice of the Ministry of Finance onRevising and Issuing the Format of Consolidated Financial Statements (2019) [CK [2019] No.16), theCompany has prepared financial statements in accordance with the requirements of the new corporatefinancial statement format. As a result, the financial statement items have been changed and the comparisondata of the comparable period has been adjusted.
1) Affected consolidate balance sheet as at December 31, 2018:
2019, and the Notice of the Ministry of Finance on Revising and Issuing theFormat of Consolidated Financial Statements in 2018 (CK [2019] No.1) wasabolished simultaneously. The Company revised the format of the financialstatements according to CK [2019] No.6 and CK [2019] No.16.Item before adjustment
| Item before adjustment | December 31, 2018 | Item after adjustment | January 1, 2019 |
| Notes receivable and accounts receivable | 1,714,919,431.48 | Notes receivable | 631,234,819.16 |
| Accounts receivable | 446,773,135.47 | ||
| Receivables financing | 636,911,476.85 | ||
| Notes payable and accounts payable | 1,606,978,134.38 | Notes payable | 411,414,985.01 |
| Accounts payable | 1,195,563,149.37 |
2) Affected balance sheet of parent company as at December 31, 2018:
| Item before adjustment | December 31, 2018 | Item after adjustment | January 1, 2019 |
| Notes receivable and accounts receivable | 1,699,898,688.67 | Notes receivable | 627,434,819.16 |
| Accounts receivable | 438,002,392.66 | ||
| Receivables financing | 634,461,476.85 | ||
| Notes payable and accounts payable | 1,567,741,949.61 | Notes payable | 409,057,910.01 |
| Accounts payable | 1,158,684,039.60 |
(2) Significant accounting estimate change
√Applicable □ Not applicable
According to relevant provisions in the Accounting Standards for Business Enterprises No.22 -Recognition and Measurement of Financial Instruments implemented by the listed companies fromJanuary 1, 2019, the Company changes the credit loss rate of commercial acceptance billsreceivable to the same as that of accounts receivable from January 1, 2019 based on the forwardthinking and prudent thinking and its actual situation with the significant increase in the commercialacceptance bills receivable in recent years. This change has been approved by the management.
(1) Adjustment of relevant items in financial statements at the beginning of theimplementation year as a result of implementation of new financial instrument standards from 2019:
1) Consolidated Balance Sheet
| Item | December 31, 2018 | January 01, 2019 | Adjusted figure |
| Current assets: | |||
| Trading financial assets | Not applicable | 2,570,000,000.00 | 2,570,000,000.00 |
| Notes receivable | 1,268,146,296.01 | 631,234,819.16 | -636,911,476.85 |
| Receivables financing | Not applicable | 636,911,476.85 | 636,911,476.85 |
| Other current assets | 2,591,760,176.09 | 21,760,176.09 | -2,570,000,000.00 |
| Non-current assets: | |||
| Available-for-sale financial assets | 119,948,534.00 | Not applicable | -119,948,534.00 |
| Other equity instrument investments | Not applicable | 119,948,534.00 | 119,948,534.00 |
Note: The table above presents only the affected financial statement items, not the unaffectedfinancial statement items.
2) Balance sheet of parent company
| Item | December 31, 2018 | January 01, 2019 | Adjusted figure |
| Trading financial assets | Not applicable | 2,430,000,000.00 | 2,430,000,000.00 |
| Notes receivable | 1,261,896,296.01 | 627,434,819.16 | -634,461,476.85 |
| Receivables financing | Not applicable | 634,461,476.85 | 634,461,476.85 |
| Other current assets | 2,448,736,487.97 | 18,736,487.97 | -2,430,000,000.00 |
| Non-current assets: | |||
| Available-for-sale financial assets | 119,948,534.00 | Not applicable | -119,948,534.00 |
| Other equity instrument investments | Not applicable | 119,948,534.00 | 119,948,534.00 |
Note: The table above presents only the affected financial statement items, not the unaffectedfinancial statement items.
45. Other
VI. Tax
1. Main tax categories and tax rates
| Tax category | Taxation basis | Tax rate |
| Added value tax | Income from selling commodities | 16%, 13% |
| Added value tax | Technical service income | 6% |
| Added value tax | Income from house lease | 5% |
| Urban maintenance and construction tax | Turnover tax actually paid | 7% |
| Education surcharge | Turnover tax actually paid | 3% |
| Surcharge for local education | Turnover tax actually paid | 2% |
| Housing property tax | 70% of original value of the property | 1.2% |
| Housing property tax | Rental income | 12% |
| Land use tax | Total land area | 5-10yuan/m2 |
| Corporate income tax | Income tax payable | 15%, 25% |
2. Tax preference
Preferential policies for income taxOn November 13, 2017, the Science Technology Department of Zhejiang Province, Zhejiang Provincial Department ofFinance, Zhejiang Provincial Tax Service of State Taxation Administration and Zhejiang Local Taxation Bureau jointlyissued a high-tech enterprise certificate (No. GR201733000884) and the Company passed the high-tech enterpriseidentification for 3 years. According to relevant regulations, after passing the high-tech enterprise identification, theCompany can enjoy the relevant preferential policies of the state on high-tech enterprises for three consecutive years (i.e.,the income tax preference period from January 1, 2017 to December 31, 2019), and the enterprise income tax shall belevied at the rate of 15%.Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd., a subsidiary of the Company, obtained the high-tech enterprisecertificate (No. GR201933002261) jointly issued by the Science Technology Department of Zhejiang Province, ZhejiangProvincial Department of Finance and Zhejiang Provincial Tax Service of State Taxation Administration on December 4,2019 and passed the high-tech enterprise identification. The Company can enjoy the relevant preferential policies of thestate on high-tech enterprises for three consecutive years (i.e., the income tax preference period from January 1, 2019 toDecember 31, 2021), and the enterprise income tax shall be levied at the rate of 15%.Preferential tax policies for land use taxOn October 3, 2018, the General Office of the People's Government of Zhejiang Province issued a document (ZZBF [2018]No. 99), stipulating that class A enterprises were fully exempted from the urban land use tax from January 1, 2018 toDecember 31, 2019. Robam is a class A enterprise and enjoys the preferential policy of full exemption from the urban landuse tax.According to the Notice of the Ministry of Finance and the State Taxation Administration on Adjusting the VAT Rate (MOF,STA and GAC Announcement 2019 No.39), the tax rate 16% for the VAT taxable sales activities or imported goods shallbe adjusted to 13% from April 1, 2019.VII. Notes to items in consolidated financial statements
1. Monetary capital
Unit: yuan
| Item | Ending balance | Beginning balance |
| Cash on hand | 218,775.77 | 380,338.61 |
| Bank deposit | 4,029,077,489.73 | 2,176,839,520.24 |
| Other monetary capital | 24,825,460.73 | 19,486,949.50 |
| Total | 4,054,121,726.23 | 2,196,706,808.35 |
Other descriptionNote: Other monetary capital at the year end is 24,825,460.73yuan, including the L/C deposit of23,477,460.73yuan and acceptance deposit of 1,348,000.00, which are limited funds.
2. Trading financial assets
Unit: yuan
| Item | Ending balance | Beginning balance |
| Financial assets measured with fair value and with the changes included in current profit and loss | 1,360,000,000.00 | 2,570,000,000.00 |
| Where: | ||
| Bank financial products | 1,360,000,000.00 | 2,570,000,000.00 |
| Where: | ||
| Total | 1,360,000,000.00 | 2,570,000,000.00 |
3. Derivative financial assets
4. Notes receivable
(1) Classified presentation of notes receivable
Unit: yuan
| Item | Ending balance | Beginning balance |
| Bank acceptance bill | 359,876,143.64 | 357,734,795.15 |
| Trade acceptance | 626,817,005.76 | 273,500,024.01 |
| Total | 986,693,149.40 | 631,234,819.16 |
Unit: yuan
| Category | Ending balance | Beginning balance | ||||||||
| Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
| Amount | Proportion | Amount | Accruing proportion | Amount | Proportion | Amount | Accruing proportion | |||
| Where: | ||||||||||
| Notes receivable of provision for bad debt by combination | 1,019,683,518.12 | 100.00% | 32,990,368.72 | 3.24% | 986,693,149.40 | 636,808,451.88 | 100.00% | 5,573,632.72 | 0.88% | 631,234,819.16 |
| Where: | ||||||||||
| Including: banker's acceptance bill | 359,876,143.64 | 35.29% | 0.00 | 0.00% | 359,876,143.64 | 357,734,795.15 | 56.18% | 0.00 | 0.00% | 357,734,795.15 |
| Commercial acceptance bill | 659,807,374.48 | 64.71% | 32,990,368.72 | 5.00% | 626,817,005.76 | 279,073,656.73 | 43.82% | 5,573,632.72 | 2.00% | 273,500,024.01 |
| Total | 1,019,683,518.12 | 100.00% | 32,990,368.72 | 3.24% | 986,693,149.40 | 636,808,451.88 | 100.00% | 5,573,632.72 | 0.88% | 631,234,819.16 |
Provision for bad debt by combination:
Unit: yuan
| Name | Ending balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Commercial acceptance bill combination | 659,807,374.48 | 32,990,368.72 | 5.00% |
| Total | 659,807,374.48 | 32,990,368.72 | -- |
(2) Provision, recovery or reversal of bad debt reserves in the current periodProvision for bad debts in current period:
Unit: yuan
| Category | Beginning balance | Changes in amount in current period | Ending balance | |||
| Provision | Recovered or reversed | Canceled after verification | Other | |||
| Commercial acceptance bill | 5,573,632.72 | 27,416,736.00 | 0.00 | 0.00 | 32,990,368.72 | |
| Total | 5,573,632.72 | 27,416,736.00 | 32,990,368.72 | |||
Where the amount of bad debt provision recovered or transferred back is important:
□ Applicable √ Not applicable
(3) Notes receivable pledged by the Company at the end of the period
(4) Notes receivable endorsed or discounted by the Company at the end of the period and notexpired yet on the balance sheet date
Unit: yuan
| Item | Amount with recognition terminated at the end of the period | Amount with recognition not terminated at the end of the period |
| Bank acceptance bill | 86,044,636.52 | 0.00 |
| Total | 86,044,636.52 | 0.00 |
(5) Notes transferred to accounts receivable by the Company at the end of the period due tofailure of the drawer to perform
(6) Notes receivable actually written off at the current period
5. Accounts receivable
(1) Classified disclosure of accounts receivable
Unit: yuan
| Category | Ending balance | Beginning balance | ||||||||
| Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
| Amount | Proportion | Amount | Accruing proportion | Amount | Proportion | Amount | Accruing proportion | |||
| Accounts receivable of provision for bad debt by single item | 4,216,329.97 | 0.55% | 4,216,329.97 | 100.00% | 0.00 | 3,091,619.79 | 0.65% | 3,091,619.79 | 100.00% | 0.00 |
| Where: | ||||||||||
| Accounts receivable of provision for bad debt by combination | 768,561,756.12 | 99.45% | 42,930,854.84 | 5.59% | 725,630,901.28 | 474,397,041.21 | 99.35% | 27,623,905.74 | 5.82% | 446,773,135.47 |
| Where: | ||||||||||
| Total | 772,778,086.09 | 100.00% | 47,147,184.81 | 725,630,901.28 | 477,488,661.00 | 100.00% | 30,715,525.53 | 6.43% | 446,773,135.47 | |
Provision for bad debt by single item: accounts receivable of provision for bad debt by single item due to significantly
different credit risks
Unit: yuan
| Name | Ending balance | |||
| Book balance | Provision for bad debt | Accruing proportion | Reasons for provision | |
| Accounts receivable without large single amount and withdrawn with single provision for bad debt | 4,216,329.97 | 4,216,329.97 | 100.00% | Expected irrecoverable |
| Total | 4,216,329.97 | 4,216,329.97 | -- | -- |
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 744,095,171.82 |
| 1~2 years | 16,585,163.14 |
| 2~3 years | 7,440,505.92 |
| More than 3 years | 4,657,245.21 |
| 3~4 years | 1,550,074.45 |
| 4~5 years | 1,279,764.43 |
| More than 5 years | 1,827,406.33 |
| Total | 772,778,086.09 |
(2) Provision, recovery or reversal of bad debt reserves in the current period
| Category | Year-beginning balance | Amount of change in current year | Year-end balance | |||
| Provision | Recovered or reversed | Write-off canceled after verification | ||||
| Provision for bad debts of accounts receivable | 30,715,525.53 | 17,613,423.11 | 0.00 | 1,181,763.83 | 47,147,184.81 | |
| 合计 | 30,715,525.53 | 17,613,423.11 | 0.00 | 1,181,763.83 | 47,147,184.81 | |
(3) Accounts receivable actually written off at the current period
Write-off of important accounts receivable:
Unit: yuan
| Nature of accounts receivable | Write-off amount | Cause for write-off | Write-off procedures | Whether the account is generated by related party transaction |
| Accounts receivable written off actually | 1,181,763.83 | Expected irrecoverable | Approval by management | No |
| Total | 1,181,763.83 | -- | -- | -- |
Write-off of accounts receivable:
(4) Receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Ending balance of accounts receivable | Proportion in total ending balance of accounts receivable | Ending balance of bad debt provision |
| Unit 1 | 132,784,858.17 | 17.18% | 6,639,242.91 |
| Unit 2 | 115,125,176.32 | 14.90% | 5,756,258.82 |
| Unit 3 | 93,445,059.93 | 12.09% | 4,672,253.00 |
| Unit 4 | 16,985,591.40 | 2.20% | 849,279.57 |
| Unit 5 | 15,667,295.93 | 2.03% | 783,364.80 |
| Total | 374,007,981.75 | 48.40% |
(5) Accounts receivable derecognized due to transfer of financial assets
(6) Amount of assets and liabilities formed by transferring accounts receivable and continuinginvolvement
6. Receivables financing
Unit: yuan
| Item | Ending balance | Beginning balance |
| Banker's acceptance bill | 408,972,104.07 | 636,911,476.85 |
| Total | 408,972,104.07 | 636,911,476.85 |
Changes in accounts receivable financing in current period and change in fair value? Applicable Not applicableThe Company discounts and endorses the banker’s acceptance bills according to the daily operation andmanagement. The business model for managing the banker’s acceptance bills is to collect contractual cashflows and to sell the bills, so the balance of acceptance bills receivable from banks presented as receivablesfinancing.
7. Advances to suppliers
(1) Presentation of advances to suppliers by aging
Unit: yuan
| Aging | Ending balance | Beginning balance | ||
| Amount | Proportion | Amount | Proportion | |
| Within 1 year | 50,109,021.83 | 99.99% | 58,293,082.84 | 97.99% |
| 1~2 years | 4,528.01 | 0.01% | 127,306.00 | 0.22% |
| 2~3 years | 0.00 | 0.00% | 1,065,541.86 | 1.79% |
| Total | 50,113,549.84 | -- | 59,485,930.70 | -- |
Reasons for non-timely settlement of important advances from customers with the aging more than 1 year:
(2) Advances to suppliers with top 5 ending balances by prepayment objectThe total amount of advances to suppliers with top 5 ending balances by prepayment object in the currentyear was 27,682,203.94yuan, accounting for 55.24% of total number of ending balance of advances tosuppliers.
8. Other receivables
Unit: yuan
| Item | Ending balance | Beginning balance |
| Interest receivable | 0.00 | 0.00 |
| Dividends receivable | 14,295,039.38 | |
| Other receivables | 96,604,409.27 | 70,182,460.52 |
| Total | 110,899,448.65 | 70,182,460.52 |
(1) Interest receivable
1) Classification of interest receivable
2) Important overdue interest
3) Provision for bad debt
□ Applicable √ Not applicable
(2) Dividends receivable
1) Classification of dividends receivable
Unit: yuan
| Project (or investee) | Ending balance | Beginning balance |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 14,295,039.38 | |
| Total | 14,295,039.38 |
2) Important dividends receivable with the aging more than 1 year
3) Provision for bad debt
□ Applicable √ Not applicable
(3) Other receivables
1) Other receivables classified by nature
Unit: yuan
| Nature of payment | Ending book balance | Beginning book balance |
| Collection by third party | 63,604,415.88 | 30,291,539.08 |
| Deposit and margin | 37,167,812.49 | 34,993,888.42 |
| Imprest | 3,137,976.93 | 2,883,138.90 |
| Withheld amount | 2,502,348.12 | 2,554,065.31 |
| Other | 512,898.94 | 5,987,699.54 |
| Total | 106,925,452.36 | 76,710,331.25 |
2) Provision for bad debt
Unit: yuan
| Provision for bad debt | Stage 1 | Stage 2 | Stage 3 | Total |
| Expected credit losses over the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment has occurred) | ||
| Balance on January 1, 2019 | 6,527,870.73 | 6,527,870.73 | ||
| Balance on January | —— | —— | —— | —— |
| 1, 2019 in current period | ||||
| Withdrawn in current period | 3,793,172.36 | 3,793,172.36 | ||
| Balance on December 31, 2019 | 10,321,043.09 | 10,321,043.09 |
Large book balance change in the current period of provision for loss
□ Applicable √ Not applicable
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 80,092,781.70 |
| 1-2 years | 5,928,780.29 |
| 2-3 years | 18,220,203.03 |
| 3-4 years | 978,391.96 |
| 4-5 years | 575,029.94 |
| More than 5 years | 1,130,265.44 |
| Total | 106,925,452.36 |
3) Provision, recovery or reversal of bad debt reserves in the current period
| Category | Year-beginning balance | Amount of change in current year | Year-end balance | ||
| Provision | Recovered or reversed | Write-off canceled after verification | |||
| Provision for bad debt of other receivables | 6,527,870.73 | 3,793,172.36 | 0.00 | 0.00 | 10,321,043.09 |
| Total | 6,527,870.73 | 3,793,172.36 | 0.00 | 0.00 | 10,321,043.09 |
4) Other receivables actually written off at the current period
5) Other receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Nature of payment | Ending balance | Aging | Proportion in total other ending balance | Ending balance of bad debt provision |
| receivable | |||||
| Unit 1 | Collection by third party | 56,941,569.55 | Within 1 year | 53.25% | 2,847,078.48 |
| Unit 2 | Deposit and margin | 14,778,000.00 | 2-3 years | 13.82% | 2,955,600.00 |
| Unit 3 | Deposit and margin | 3,000,000.00 | Within 1 year | 2.81% | 150,000.00 |
| Unit 4 | Deposit and margin | 1,520,225.00 | 2-3 years | 1.42% | 304,045.00 |
| Unit 5 | Collection by third party | 903,740.22 | Within 1 year | 0.85% | 45,187.01 |
| Total | -- | 77,143,534.77 | -- | 72.15% | 6,301,910.49 |
6) Accounts receivable involving government subsidies
7) Other receivables derecognized due to transfer of financial assets
8) Amount of assets and liabilities formed by transferring other receivables and continuinginvolvement
9. Inventory
(1) Inventory classification
Unit: yuan
| Item | Ending balance | Beginning balance | ||||
| Book balance | Falling price reserves | Book value | Book balance | Falling price reserves | Book value | |
| Raw materials | 65,865,050.18 | 0.00 | 65,865,050.18 | 58,785,060.73 | 0.00 | 58,785,060.73 |
| Work in process | 48,635,094.61 | 0.00 | 48,635,094.61 | 42,489,335.72 | 0.00 | 42,489,335.72 |
| Merchandise inventory | 333,027,454.91 | 9,321,963.35 | 323,705,491.56 | 289,182,037.49 | 0.00 | 289,182,037.49 |
| Semi-finished products shipped in transit | 882,209,547.51 | 0.00 | 882,209,547.51 | 902,710,838.63 | 0.00 | 902,710,838.63 |
| Low priced | 18,761,741.34 | 0.00 | 18,761,741.34 | 53,945,458.46 | 0.00 | 53,945,458.46 |
| and easily worn articles and wrappage | ||||||
| Total | 1,348,498,888.55 | 9,321,963.35 | 1,339,176,925.20 | 1,347,112,731.03 | 0.00 | 1,347,112,731.03 |
(2) Depreciation reserves for inventories
Unit: yuan
| Item | Beginning balance | Amount increased in current period | Amount decreased in current period | Ending balance | ||
| Provision | Other | Reversed or written off | Other | |||
| Merchandise inventory | 0.00 | 9,321,963.35 | 0.00 | 0.00 | 0.00 | 9,321,963.35 |
| Total | 0.00 | 9,321,963.35 | 0.00 | 0.00 | 0.00 | 9,321,963.35 |
(3) Description of ending balance of inventory containing the capitalized amount of borrowingcosts
(4) Completed and unliquidated assets resulting from the ending construction contract
10. Contract assets
12. Non-current assets due within a year
13. Other current assets
Unit: yuan
| Item | Ending balance | Beginning balance |
| Prepaid tax | 13,802,530.76 | 18,854,992.34 |
| Pending deduct VAT on purchase | 2,386,707.05 | 2,905,183.75 |
| Total | 16,189,237.81 | 21,760,176.09 |
14. Debt investments
15. Other debt investments
16. Long-term receivables
(1) Long-term receivables
(2) Long-term receivables derecognized due to transfer of financial assets
(3) Amount of assets and liabilities formed by transferring long-term receivables and continuinginvolvement
17. Long-term equity investments
Unit: yuan
| Invested unit | Beginning balance (book value) | Increase or decrease in current period | Ending balance (book value) | Balance of impairment provision at the end of period | |||||||
| Further investment | Capital reduction | Investment gains and losses recognized by the equity method | Adjustment of other comprehensive income | Changes in other equity | Declared payment of cash dividends or profits | Provision for impairment | Other | ||||
| I. Joint enterprise | |||||||||||
| De Dietrich Trade (Shanghai) Co., Ltd. | 2,617,851.16 | 0.00 | 0.00 | 1,550,487.63 | 0.00 | 0.00 | 0.00 | 0.00 | 4,168,338.79 | ||
| Subtotal | 2,617,851.16 | 1,550,487.63 | 4,168,338.79 | ||||||||
| II. Joint venture | |||||||||||
| Total | 2,617,851.16 | 1,550,487.63 | 4,168,338.79 | ||||||||
18. Other equity instrument investments
Unit: yuan
| Item | Ending balance | Beginning balance |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 100,000,000.00 | 100,000,000.00 |
| Shanghai MXCHIP Information Technology Co., Ltd. | 2,116,023.22 | 19,948,534.00 |
| Total | 102,116,023.22 | 119,948,534.00 |
Separate disclosure of the current period of non-transactional equity instruments
Unit: yuan
| Item name | Recognized dividend income | Aggregate gains | Aggregate losses | Amount of other comprehensive income transferred to retained earnings | Cause for designation to measure at fair value of which changes are recorded into other comprehensive income | Causes for carryforward retained earnings of other comprehensive income |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 14,295,039.38 | 0.00 | 0.00 | 0.00 | Held for non-trading purposes | |
| Shanghai MXCHIP Information Technology Co., Ltd. | 0.00 | 0.00 | 17,832,510.78 | 0.00 | Held for non-trading purposes |
19. Other non-current financial assets
20. Investment properties
(1) Investment properties using cost measurement mode
√Applicable □ Not applicable
Unit: yuan
| Item | Houses and buildings | Total |
| I. Original book value | ||
| 1. Beginning balance | 189,197.82 | 189,197.82 |
| 2. Amount increased in current period | ||
| 3. Amount decreased in current period | ||
| 4. Ending balance | 189,197.82 | 189,197.82 |
| II. Accumulated depreciation and amortization | ||
| 1. Beginning balance | 67,622.68 | 67,622.68 |
| 2. Amount increased in current period | 8,986.80 | 8,986.80 |
| (1) Accrual or amortization | 8,986.80 | 8,986.80 |
| 3. Amount decreased in current period | ||
| 4. Ending balance | 76,609.48 | 76,609.48 |
| III. Provision for impairment | ||
| IV. Book value | ||
| 1. Ending book value | 112,588.34 | 112,588.34 |
| 2. Beginning book value | 121,575.14 | 121,575.14 |
(2) Investment properties using fair value measurement mode
□ Applicable √ Not applicable
(3) Investment properties without certificate of title
Other description
21. Fixed assets
Unit: yuan
| Item | Ending balance | Beginning balance |
| Fixed assets | 826,234,929.97 | 842,877,466.95 |
| Total | 826,234,929.97 | 842,877,466.95 |
(1) Fixed assets
Unit: yuan
| Item | Houses and building | Machinery equipment | Transportation equipment | Other equipment | Total |
| I. Original book value | |||||
| 1. Beginning balance | 679,043,141.03 | 492,599,119.52 | 19,153,855.34 | 71,671,959.22 | 1,262,468,075.11 |
| 2. Amount increased in current period | 2,217,299.08 | 67,639,168.50 | 2,450,047.80 | 4,400,012.21 | 76,706,527.59 |
| (1) Purchase | 117,272.72 | 4,755,251.34 | 2,450,047.80 | 4,248,654.64 | 11,571,226.50 |
| (2) Transfer from construction in progress | 2,100,026.36 | 62,883,917.16 | 0.00 | 151,357.57 | 65,135,301.09 |
| 3. Amount decreased in current period | 267,625.88 | 1,825,334.51 | 1,901,600.35 | 3,539,837.10 | 7,534,397.84 |
| (1) Disposal or | 267,625.88 | 1,825,334.51 | 1,901,600.35 | 3,539,837.10 | 7,534,397.84 |
| scrap | |||||
| 4. Ending balance | 680,992,814.23 | 558,412,953.51 | 19,702,302.79 | 72,532,134.33 | 1,331,640,204.86 |
| II. Accumulated depreciation | |||||
| 1. Beginning balance | 178,025,829.50 | 191,398,003.31 | 10,519,209.44 | 39,647,565.91 | 419,590,608.16 |
| 2. Amount increased in current period | 31,322,792.71 | 49,220,946.92 | 2,551,073.77 | 8,535,307.56 | 91,630,120.96 |
| (1) Provision | 31,322,792.71 | 49,220,946.92 | 2,551,073.77 | 8,535,307.56 | 91,630,120.96 |
| 3. Amount decreased in current period | 33,524.64 | 810,441.47 | 1,808,144.29 | 3,163,343.83 | 5,815,454.23 |
| (1) Disposal or scrap | 33,524.64 | 810,441.47 | 1,808,144.29 | 3,163,343.83 | 5,815,454.23 |
| 4. Ending balance | 209,315,097.57 | 239,808,508.76 | 11,262,138.92 | 45,019,529.64 | 505,405,274.89 |
| III. Provision for impairment | |||||
| IV. Book value | |||||
| 1. Ending book value | 471,677,716.66 | 318,604,444.75 | 8,440,163.87 | 27,512,604.69 | 826,234,929.97 |
| 2. Beginning book value | 501,017,311.53 | 301,201,116.21 | 8,634,645.90 | 32,024,393.31 | 842,877,466.95 |
(2) Fixed assets that are temporarily idle
(3) Fixed assets under financing lease
(4) Fixed assets leased out by operating lease
(5) Fixed assets without certificate of title
(6) Liquidation of fixed assets
22. Construction in progress
Unit: yuan
| Item | Ending balance | Beginning balance |
| Construction in progress | 272,211,720.62 | 184,440,655.49 |
| Total | 272,211,720.62 | 184,440,655.49 |
(1) Construction in progress
Unit: yuan
| Item | Ending balance | Beginning balance | ||||
| Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
| Maoshan intelligent manufacturing base infrastructure project | 259,945,664.42 | 0.00 | 259,945,664.42 | 116,239,899.42 | 0.00 | 116,239,899.42 |
| Management software | 3,574,118.78 | 0.00 | 3,574,118.78 | 4,163,334.80 | 0.00 | 4,163,334.80 |
| Project of production department 3 | 2,015,449.74 | 0.00 | 2,015,449.74 | 5,299,145.30 | 0.00 | 5,299,145.30 |
| Cutting machine | 1,435,896.56 | 0.00 | 1,435,896.56 | 1,435,896.56 | 0.00 | 1,435,896.56 |
| Project of production department 2 | 1,206,896.55 | 0.00 | 1,206,896.55 | 11,143,604.48 | 0.00 | 11,143,604.48 |
| Dispensing equipment project | 713,675.21 | 0.00 | 713,675.21 | 713,675.21 | 0.00 | 713,675.21 |
| Product homemade platform production line | 0.00 | 0.00 | 0.00 | 11,138,220.60 | 0.00 | 11,138,220.60 |
| Product automated assembly line | 0.00 | 0.00 | 0.00 | 7,606,837.60 | 0.00 | 7,606,837.60 |
| Automatic line equipment | 0.00 | 0.00 | 0.00 | 5,086,206.90 | 0.00 | 5,086,206.90 |
| Side suction punch press | 0.00 | 0.00 | 0.00 | 4,102,564.65 | 0.00 | 4,102,564.65 |
| Spraying line | 0.00 | 0.00 | 0.00 | 3,914,529.92 | 0.00 | 3,914,529.92 |
| Riveting equipment | 0.00 | 0.00 | 0.00 | 2,119,658.12 | 0.00 | 2,119,658.12 |
| Outdoor elevator project of workshop 4 | 0.00 | 0.00 | 0.00 | 1,472,079.01 | 0.00 | 1,472,079.01 |
| Cleaning line | 0.00 | 0.00 | 0.00 | 1,085,470.11 | 0.00 | 1,085,470.11 |
| Workshop decoration engineering | 0.00 | 0.00 | 0.00 | 1,017,299.09 | 0.00 | 1,017,299.09 |
| Natural gas pipe installation engineering | 0.00 | 0.00 | 0.00 | 809,090.91 | 0.00 | 809,090.91 |
| Roll forming equipment | 0.00 | 0.00 | 0.00 | 786,324.79 | 0.00 | 786,324.79 |
| Automatic line equipment for host panel polishing | 0.00 | 0.00 | 0.00 | 521,367.50 | 0.00 | 521,367.50 |
| Automatic polishing equipment | 0.00 | 0.00 | 0.00 | 512,820.67 | 0.00 | 512,820.67 |
| Call center expansion project | 0.00 | 0.00 | 0.00 | 509,005.31 | 0.00 | 509,005.31 |
| Other sporadic projects | 3,320,019.36 | 0.00 | 3,320,019.36 | 4,763,624.54 | 0.00 | 4,763,624.54 |
| Total | 272,211,720.62 | 0.00 | 272,211,720.62 | 184,440,655.49 | 0.00 | 184,440,655.49 |
(2) Current changes in major projects under construction
Unit: yuan
| Item name | Budget number | Beginning balance | Amount increased in current period | Amount carried forward to fixed assets in current period | Other decreases in current period | Ending balance |
| Maoshan intelligent manufacturing base | 549,550,000.00 | 116,239,899.42 | 143,705,765.00 | 0.00 | 0.00 | 259,945,664.42 |
| infrastructure project | ||||||
| Management software | 4,163,334.80 | 132,743.36 | 0.00 | 721,959.38 | 3,574,118.78 | |
| Project of production department 3 | 5,299,145.30 | 6,902.72 | 3,290,598.28 | 0.00 | 2,015,449.74 | |
| Cutting machine | 1,435,896.56 | 0.00 | 0.00 | 0.00 | 1,435,896.56 | |
| Project of production department 2 | 11,143,604.48 | 0.17 | 9,341,880.32 | 594,827.78 | 1,206,896.55 | |
| Dispensing equipment project | 713,675.21 | 0.00 | 0.00 | 0.00 | 713,675.21 | |
| Homemade platform production line | 11,138,220.60 | 605.22 | 11,138,825.82 | 0.00 | 0.00 | |
| Automated assembly line | 7,606,837.60 | 0.00 | 7,606,837.60 | 0.00 | 0.00 | |
| Automatic line equipment | 5,086,206.90 | 0.00 | 5,086,206.90 | 0.00 | 0.00 | |
| Side suction punch press | 4,102,564.65 | 0.00 | 4,102,564.65 | 0.00 | 0.00 | |
| Spraying line | 3,914,529.92 | 0.00 | 3,914,529.92 | 0.00 | 0.00 | |
| Riveting equipment | 2,119,658.12 | 0.00 | 2,119,658.12 | 0.00 | 0.00 | |
| Outdoor elevator project | 1,472,079.01 | 0.00 | 1,472,079.01 | 0.00 | 0.00 | |
| Cleaning line | 1,085,470.11 | 0.00 | 1,085,470.11 | 0.00 | 0.00 | |
| Workshop decoration engineering | 1,017,299.09 | 0.00 | 1,017,299.09 | 0.00 | 0.00 | |
| Pipe installation engineering | 809,090.91 | 0.00 | 809,090.91 | 0.00 | 0.00 | |
| Roll forming equipment | 786,324.79 | 0.00 | 786,324.79 | 0.00 | 0.00 | |
| Automatic polishing line equipment | 521,367.50 | 0.00 | 521,367.50 | 0.00 | 0.00 |
| Automatic polishing equipment | 512,820.67 | 0.00 | 512,820.67 | 0.00 | 0.00 | |
| Call center project | 509,005.31 | 0.00 | 0.00 | 509,005.31 | 0.00 | |
| Other sporadic projects | 4,763,624.54 | 11,405,865.88 | 12,329,747.40 | 519,723.66 | 3,320,019.36 | |
| Total | 549,550,000.00 | 184,440,655.49 | 155,251,882.35 | 65,135,301.09 | 2,345,516.13 | 272,211,720.62 |
| Continued | ||||||
| Project name | Budget number | Proportion of project input to the budget (%) | Progress of works | Accumulated amount of interest capitalization | Including: interest of current year Capitalized amount | Interest of current year Capitalization rate |
| Maoshan intelligent manufacturing base infrastructure project | 549,550,000.00 | 47.30 | 47.30% | 0.00 | 0.00 | 0.00 |
(3) Provision for impairment of construction in progress in current year
(4) Engineering materials
23. Productive biological assets
(1) Productive biological assets using cost measurement mode
□ Applicable √ Not applicable
(2) Productive biological assets using fair value measurement mode
□ Applicable √ Not applicable
24. Oil and gas assets
□ Applicable √ Not applicable
25. Right-of-use assets
26. Intangible assets
(1) Intangible assets
Unit: yuan
| Item | Land use right | Software | Trademark | Patent | Total |
| I. Original book value | |||||
| 1. Beginning balance | 168,051,179.95 | 42,242,921.55 | 24,500,000.00 | 7,300,000.00 | 242,094,101.50 |
| 2. Amount increased in current period | 34,367,725.00 | 4,745,109.56 | 124,622.64 | 0.00 | 39,237,457.20 |
| (1) Purchase | 34,367,725.00 | 4,745,109.56 | 124,622.64 | 0.00 | 39,237,457.20 |
| 3. Amount decreased in current period | 0.00 | 513,336.75 | 0.00 | 0.00 | 513,336.75 |
| (1) Disposal | 0.00 | 513,336.75 | 0.00 | 0.00 | 513,336.75 |
| 4. Ending balance | 202,418,904.95 | 46,474,694.36 | 24,624,622.64 | 7,300,000.00 | 280,818,221.95 |
| II. Accumulated amortization | |||||
| 1. Beginning balance | 17,861,002.07 | 28,472,381.07 | 1,225,000.00 | 561,538.46 | 48,119,921.60 |
| 2. Amount increased in current period | 3,413,591.84 | 6,067,672.68 | 2,453,115.56 | 1,123,076.92 | 13,057,457.00 |
| (1) Provision | 3,413,591.84 | 6,067,672.68 | 2,453,115.56 | 1,123,076.92 | 13,057,457.00 |
| 3. Amount decreased in current period | 3,413,591.84 | 6,067,672.68 | 2,453,115.56 | 1,123,076.92 | 13,057,457.00 |
| (1) Disposal | 0.00 | 92,427.16 | 0.00 | 0.00 | 92,427.16 |
| 4. Ending balance | 21,274,593.91 | 34,447,626.59 | 3,678,115.56 | 1,684,615.38 | 61,084,951.44 |
| III. Provision for impairment | |||||
| IV. Book value | |||||
| 1. Ending book value | 181,144,311.04 | 12,027,067.77 | 20,946,507.08 | 5,615,384.62 | 219,733,270.51 |
| 2. Beginning book value | 150,190,177.88 | 13,770,540.48 | 23,275,000.00 | 6,738,461.54 | 193,974,179.90 |
(2) Land use right without certificate of title
27. Development expenditure
28. Goodwill
(1) Original book value of goodwill
Unit: yuan
| Investee name or goodwill forming matter | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||
| By business combination | Disposal | |||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 80,589,565.84 | 0.00 | 0.00 | 80,589,565.84 | ||
| Total | 80,589,565.84 | 80,589,565.84 | ||||
(2) Provision for impairment of goodwill
Information about the asset group or combination of asset groups in which the goodwill is locatedIn 2018, the Company received the equity transfer of Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. (ShengzhouKinde) at RMB 50 million, achieved business combination not under common control by capital increase of RMB 112.32million and acquired 51.00% equity of Shengzhou Kinde. China Alliance Appraisal Co., Ltd. appraised the fair value ofidentifiable assets and liabilities of Shengzhou Kinde on June 30, 2018 and issued the appraisal report Alliance PBZ(2018) No. 020645. The transaction consideration was 162,320,000.00yuan. The fair value of the net identifiable assets ofShengzhou Kinde was 160,255,753.26. The Company enjoyed 51% of the assets and recognized the consolidatedgoodwill of 80,589,565.84yuan.Goodwill impairment test process and recognition method of key parameters (forecast period growth rate when estimatingthe present value of future cash flow, stable period growth rate, profit rate, discount rate and forecast period) and goodwillimpairment loss:
The recoverable amount of the asset group is determined according to the five-year cash flow forecast approved by themanagement. The cash flow after the five-year forecast period was reckoned by the specific average growth rate in thegrowth period and calculated by the present value model of the future cash flow.After acquisition of Shengzhou Kinde, it operates independently as a holding subsidiary of the Company and is deemedas an asset group combination according to the actual operation management. The Company employed ZhongheAppraisal Co., Ltd. to appraise the recoverable amount of Shengzhou Kinde asset group as of December 31, 2019.According to the Valuation Report of Asset Group Recoverable Amount Valuation Items of Shengzhou Kinde IntelligentKitchen Electric Co., Ltd. Involved in Intended Goodwill Impairment Test of Hangzhou Robam Appliances Co., Ltd. (No.
ZHZB (2019) BJU3021) issued by Zhonghe Appraisal Co., Ltd., on the base date of assets evaluation of December 31,2019, the recoverable amount of the asset group of Shengzhou Kinde was evaluated as 224.43 million by the presentvalue approach of the expected future cash flow and the total value of the asset group combination (including goodwill)was 216.4267 million.
The pre-tax discount rate was selected for the impairment test in 2019 and converted through the after-tax discountrate, which was selected by WACC valuation model. The appraisal discount rate of the goodwill impairment test wasdetermined as 16.49% according to market conditions.The ratio of average gross profit for the impairment test in 2019 was properly increased according to the expectedefficiency on the basis of the ratio of average gross profit achieved in the year before the budget year.Impact of goodwill impairment testThe recoverable amount of the asset group combination of Shengzhou Kinde is greater than the book value of the assetgroup combination containing goodwill of Shengzhou Kinde, so the goodwill impairment does not exist in the asset groupcombination of Shengzhou Kinde and the provision for impairment of goodwill may not be withdrawn.
29. Long-term unamortized expenses
Unit: yuan
| Item | Beginning balance | Amount increased in current period | Amortization amount in current period | Other decreases | Ending balance |
| Service charge | 0.00 | 333,486.44 | 98,823.19 | 0.00 | 234,663.25 |
| Consulting fee | 235,849.05 | 140,000.00 | 188,679.24 | 0.00 | 187,169.81 |
| Training membership fee | 88,029.35 | 75,471.70 | 62,138.37 | 0.00 | 101,362.68 |
| Brand endorsement fee | 4,609,402.37 | 0.00 | 4,609,402.37 | 0.00 | 0.00 |
| Total | 4,933,280.77 | 548,958.14 | 4,959,043.17 | 0.00 | 523,195.74 |
30. Deferred income tax assets and deferred income tax liabilities
(1) Unoffset deferred income tax assets
Unit: yuan
| Item | Ending balance | Beginning balance | ||
| Deductible temporary differences | Deferred income tax assets | Deductible temporary differences | Deferred income tax assets | |
| Recognition for provisional estimate cost | 215,006,417.88 | 32,250,962.68 | 118,518,358.59 | 18,037,753.80 |
| Recognition for | 114,851,263.30 | 17,227,689.50 | 82,021,091.35 | 12,303,163.70 |
| deferred income | ||||
| Provision for impairment of assets | 99,780,559.97 | 15,877,475.81 | 42,817,028.98 | 7,321,390.08 |
| Fair value change of other equity instrument investments | 17,832,510.78 | 2,674,876.62 | 0.00 | 0.00 |
| Unrealized profit of internal transaction | 8,075,375.65 | 2,018,843.91 | 6,284,756.04 | 1,571,189.01 |
| Payroll payable withdrawn but not issued | 5,388,241.47 | 827,267.57 | 0.00 | 0.00 |
| Recognition for equity incentive | 0.00 | 0.00 | 2,091,925.29 | 330,543.82 |
| Total | 460,934,369.05 | 70,877,116.09 | 251,733,160.25 | 39,564,040.41 |
(2) Unoffset deferred income tax liabilities
Unit: yuan
| Item | Ending balance | Beginning balance | ||
| Taxable temporary differences | Deferred income tax liabilities | Taxable temporary differences | Deferred income tax liabilities | |
| Appreciation of assets appraisal for business combination not under common control | 33,942,653.74 | 5,091,398.06 | 37,844,785.88 | 9,461,196.47 |
| Taxable temporary differences due to the pretax deduction of fixed assets | 4,176,334.57 | 626,450.19 | 3,503,773.28 | 875,943.32 |
| Total | 38,118,988.31 | 5,717,848.25 | 41,348,559.16 | 10,337,139.79 |
(3) Deferred income tax assets or liabilities presented as net amount after offset
Unit: yuan
| Item | Ending offset amount of deferred income tax assets and liabilities | Ending balance of deferred income tax assets and liabilities after offset | Beginning offset amount of deferred income tax assets and liabilities | Beginning balance of deferred income tax assets and liabilities after offset |
| Deferred income tax assets | 70,877,116.09 | |||
| Deferred income tax liabilities | 5,717,848.25 |
(4) Details of unrecognized deferred income tax assets
Unit: yuan
| Item | Ending balance | Beginning balance |
| Deductible temporary differences | 6,459,439.41 | 21,542,361.53 |
| Deductible loss | 0.00 | 73,605.00 |
| Total | 6,459,439.41 | 21,615,966.53 |
(5) Deductible losses on unrecognized deferred income tax assets will expire in the followingyear
Unit: yuan
| Year | Ending amount | Beginning amount | Remark |
| 2019 | 0.00 | 15,088,524.40 | |
| 2020 | 6,367,784.94 | 6,367,784.94 | |
| 2021 | 39,785.54 | 39,785.54 | |
| 2022 | 39,552.31 | 39,552.31 | |
| 2023 | 6,714.34 | 6,714.34 | |
| 2024 | 5,602.28 | 0.00 | |
| Total | 6,459,439.41 | 21,542,361.53 | -- |
31. Other non-current assets
Unit: yuan
| Item | Ending balance | Beginning balance |
| Advances for equipment purchase | 23,558,781.27 | 6,126,821.00 |
| Total | 23,558,781.27 | 6,126,821.00 |
32. Short-term borrowing
(1) Classification of short-term borrowing
(2) Short-term borrowing unpaid overdue
33. Trading financial liabilities
34. Derivative financial liabilities
35. Notes payable
Unit: yuan
| Type | Ending balance | Beginning balance |
| Commercial acceptance bill | 603,308,648.96 | 411,414,985.01 |
| Total | 603,308,648.96 | 411,414,985.01 |
36. Accounts payable
(1) Presentation of accounts payable
Unit: yuan
| Item | Ending balance | Beginning balance |
| Payment for materials | 880,995,549.70 | 798,811,442.97 |
| Costs | 465,097,084.50 | 313,379,353.95 |
| Project payment | 33,887,108.65 | 27,333,856.60 |
| Payment for equipment | 15,081,542.43 | 56,038,495.85 |
| Total | 1,395,061,285.28 | 1,195,563,149.37 |
(2) Important accounts payable with the aging more than 1 year
Note: As of December 31, 2019, the Company's important accounts payable with an age of more than oneyear were 41,770,994.13yuan, mainly for fees not yet settled.
37. Advance from customers
(1) Presentation of advance from customers
Unit: yuan
| Item | Ending balance | Beginning balance |
| Advances from customers | 1,092,261,332.25 | 1,170,088,458.14 |
| Total | 1,092,261,332.25 | 1,170,088,458.14 |
(2) Important advances from customers with the aging more than 1 year
(3) Settled and uncompleted items resulting from the ending construction contract
38. Contract liabilities
39. Payroll payable
(1) Presentation of payroll payable
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| I. Short-term compensation | 102,462,299.09 | 745,770,089.83 | 731,588,397.24 | 116,643,991.68 |
| II. Welfare after dismission - defined contribution plan | 4,887,196.21 | 53,272,576.73 | 52,733,439.59 | 5,426,333.35 |
| III. Dismission welfare | 0.00 | 384,921.81 | 384,921.81 | 0.00 |
| Total | 107,349,495.30 | 799,427,588.37 | 784,706,758.64 | 122,070,325.03 |
(2) Presentation of short-term compensation
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| 1. Wages, bonuses, allowances and subsidies | 98,110,801.60 | 636,281,492.00 | 622,304,144.59 | 112,088,149.01 |
| 2. Employee services and benefits | 0.00 | 28,778,436.64 | 28,778,436.64 | 0.00 |
| 3. Social insurance premium | 3,719,338.20 | 40,652,968.65 | 40,441,760.17 | 3,930,546.68 |
| Including: medical insurance premium | 3,202,053.86 | 35,437,057.58 | 35,250,256.24 | 3,388,855.20 |
| Industrial injury insurance premium | 168,342.28 | 1,358,103.26 | 1,353,683.98 | 172,761.56 |
| Birth insurance premium | 348,942.06 | 3,857,807.81 | 3,837,819.95 | 368,929.92 |
| 4. Housing fund | 259,780.00 | 29,510,428.30 | 29,498,107.30 | 272,101.00 |
| 5. Labor union expenditure and personnel education fund | 372,379.29 | 10,546,764.24 | 10,565,948.54 | 353,194.99 |
| Total | 102,462,299.09 | 745,770,089.83 | 731,588,397.24 | 116,643,991.68 |
(3) Presentation of defined contribution plans
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| 1. Basic endowment insurance | 4,717,818.43 | 51,409,972.81 | 50,898,828.50 | 5,228,962.74 |
| 2. Unemployment insurance premium | 169,377.78 | 1,862,603.92 | 1,834,611.09 | 197,370.61 |
| Total | 4,887,196.21 | 53,272,576.73 | 52,733,439.59 | 5,426,333.35 |
40. Tax payable
Unit: yuan
| Item | Ending balance | Beginning balance |
| Corporate income tax | 89,992,149.62 | 51,608,992.28 |
| Added value tax | 9,811,740.89 | 50,107,891.95 |
| Individual income tax | 1,190,263.26 | 1,907,601.56 |
| Urban maintenance and construction tax | 769,259.08 | 3,503,535.91 |
| Surcharge for local education | 549,470.80 | 2,482,481.15 |
| Stamp duty | 238,931.49 | 302,283.09 |
| Disabled person employment security fund | 174,840.07 | 586,878.75 |
| Housing property tax | 0.00 | 2,717,027.16 |
| Land use tax | 0.00 | 31,962.00 |
| Total | 102,726,655.21 | 113,248,653.85 |
41. Other payables
Unit: yuan
| Item | Ending balance | Beginning balance |
| Other payables | 241,641,864.89 | 234,490,187.04 |
| Total | 241,641,864.89 | 234,490,187.04 |
(1) Interest payable
(2) Dividends payable
(3) Other payables
1) Other payables listed by nature
Unit: yuan
| Item | Ending balance | Beginning balance |
| Margin payable | 233,004,717.16 | 207,277,172.48 |
| Deposit payable | 4,995,172.30 | 8,266,061.00 |
| Collections for others | 1,486,383.22 | 5,955,641.55 |
| Equity incentive repurchase obligation | 0.00 | 3,456,989.00 |
| Other | 2,155,592.21 | 9,534,323.01 |
| Total | 241,641,864.89 | 234,490,187.04 |
2) Important other payable with the aging more than 1 year
Note: As of December 31, 2019, the Company's important other payables with an age of more than one year were217,760,679.87yuan, mainly for sales deposit.
42. Liabilities held for sales
43. Non-current liabilities due within a year
44. Other current liabilities
45. Long-term borrowing
46. Bonds payable
47. Lease liabilities
48. Long-term payable
49. Long-term payroll payable
50. Estimated liabilities
51. Deferred income
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance | Causes |
| Government subsidies | 82,021,091.35 | 43,973,700.00 | 11,143,528.05 | 114,851,263.30 | |
| Total | 82,021,091.35 | 43,973,700.00 | 11,143,528.05 | 114,851,263.30 | -- |
Projects involving government subsidies:
Unit: yuan
| Liability item | Beginning balance | Amount of additional subsidy in current period | Amount included in current non-operating income | Ending balance | Asset/income related |
| Intelligent manufacturing, integrated standardization and new mode application project | 29,669,623.74 | 30,000,000.00 | 4,345,764.32 | 55,323,859.42 | Asset related |
| Production and construction project of annual production of 2.25 | 29,948,708.28 | 0.00 | 2,573,781.24 | 27,374,927.04 | Asset related |
| million kitchen appliances | |||||
| Construction project of kitchen appliance R&D, design and test center | 14,140,102.73 | 0.00 | 2,365,167.24 | 11,774,935.49 | Asset related |
| Technological upgrading project of manufacturing enterprises | 0.00 | 8,300,000.00 | 0.00 | 8,300,000.00 | Asset related |
| Project of annual 108 embedded kitchen electric appliance products | 0.00 | 5,673,700.00 | 56,874.25 | 5,616,825.75 | Asset related |
| Production and construction project of annual production of 1 million kitchen appliances | 4,570,409.00 | 0.00 | 1,143,783.96 | 3,426,625.04 | Asset related |
| New-generation environmentally friendly and energy-saving kitchen appliances and production line | 1,102,977.83 | 0.00 | 190,650.84 | 912,326.99 | Asset related |
| Digital intelligent manufacturing workshop project of intelligent household appliances | 900,502.44 | 0.00 | 159,426.72 | 741,075.72 | Asset related |
| Recycling transformation project | 635,297.13 | 0.00 | 91,610.16 | 543,686.97 | Asset related |
| Project of annual production of 2.25 million digital workshops | 439,504.81 | 0.00 | 103,706.04 | 335,798.77 | Asset related |
| Academician | 349,389.68 | 0.00 | 46,255.68 | 303,134.00 | Asset related |
| expert workstation | |||||
| Subsidies for investment project of annual production of 150,000 range hoods | 206,754.51 | 0.00 | 58,882.80 | 147,871.71 | Asset related |
| Kitchen appliance R&D, design and test center project | 57,821.20 | 0.00 | 7,624.80 | 50,196.40 | Asset related |
52. Other non-current liabilities
53. Capital stock
Unit: yuan
| Beginning balance | Increase/decrease (+, -) | Ending balance | |||||
| New issue of shares | Share donation | Share capital increase from reserved funds | Other | Subtotal | |||
| Total amount of shares | 949,024,050.00 | 949,024,050.00 | |||||
54. Other equity instruments
55. Capital reserve
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| Capital premium (capital stock premium) | 400,222,714.56 | 1,576,618.11 | 0.00 | 401,799,332.67 |
| Other capital surplus | 1,467,086.86 | 109,531.25 | 1,576,618.11 | 0.00 |
| Total | 401,689,801.42 | 1,686,149.36 | 1,576,618.11 | 401,799,332.67 |
Other description, including current increase/decrease and change reasons:
Note: The restricted stock cost to be recognized in 2019 in the Company’s initial restricted stock incentive
plan was 109,531.25yuan.
56. Treasury stock
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| Repurchase obligations recognized for issuance of restricted stock | 3,456,989.00 | 0.00 | 3,456,989.00 | 0.00 |
| Total | 3,456,989.00 | 3,456,989.00 | 0.00 |
Other description, including current increase/decrease and change reasons:
On January 22, 2019, the Company’s 9th meeting of the fourth Board of Directors and the 9th meeting of the fourth Boardof Supervisors reviewed and adopted the Proposal on Reserved Granting of Unlocking in Third Unlocking Period inRestricted Stock Incentive Plan. The grant date of the reserved restricted stock The Company determined by theCompany was January 4, 2016. As of January 04, 2019, the lockup period of this reserved restricted stock had expired.The unlocking conditions for the third unlocking period have been satisfied. The 27 incentive objects who agree to meetthe assessment requirements can unlock 365,625.00 restricted stocks in the third unlocking period. The restricted stocksunlocked were listed and circulated on February 18, 2019, and the repurchase obligation was reduced by 3,456,989.00yuan. The Company's initial restricted stock incentive plan has been fully unlocked.
57. Other comprehensive income
Unit: yuan
| Item | Beginning balance | Amount incurred in current period | Ending balance | |||||
| Amount before current income tax | Less: amount included in other comprehensive income in previous period and included in profit and loss in current period | Less: amount included in other comprehensive income in previous period and included in carryforward retained earnings in current period | Less: Income tax expenses | Attributable to the parent company after tax | Attributable to minority shareholders after tax | |||
| I. Other | -17,832,510. | -2,674,876. | -15,157,634. | -15,157,634. | ||||
| comprehensive income that can't be reclassified into profit and loss | 78 | 62 | 16 | 16 | ||||
| Fair value change of other equity instrument investments | -17,832,510.78 | -2,674,876.62 | -15,157,634.16 | -15,157,634.16 | ||||
| Total other comprehensive income | -17,832,510.78 | -2,674,876.62 | -15,157,634.16 | -15,157,634.16 |
Other explanations, including the adjustment of the effective part of the cash flow hedging profit and loss into the initialrecognized amount of hedged item:
58. Special reserve
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| Total | 0.00 |
59. Surplus reserves
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
| Statutory surplus reserves | 474,516,412.50 | 0.00 | 0.00 | 474,516,412.50 |
| Total | 474,516,412.50 | 0.00 | 0.00 | 474,516,412.50 |
60. Undistributed profit
Unit: yuan
| Item | Current period | Prior period |
| Undistributed profit at the end of previous period before adjustment | 4,223,611,112.65 | 3,461,806,065.78 |
| Undistributed profits at the beginning of the | 4,223,611,112.65 | 3,461,806,065.78 |
| period after adjustment | ||
| Plus: Net profits attributable to the owners of parent company in the current period | 1,589,814,847.80 | 1,473,579,665.62 |
| Common stock dividends payable | 759,219,240.00 | 711,774,618.75 |
| Undistributed profits at the end of the period | 5,054,206,720.45 | 4,223,611,112.65 |
61. Operating income and operating cost
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 7,589,302,689.33 | 3,482,255,262.10 | 7,219,989,872.63 | 3,359,791,258.78 |
| Other businesses | 171,279,166.20 | 66,522,482.94 | 204,895,401.51 | 90,973,983.51 |
| Total | 7,760,581,855.53 | 3,548,777,745.04 | 7,424,885,274.14 | 3,450,765,242.29 |
62. Taxes and surcharges
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Urban maintenance and construction tax | 34,341,853.03 | 36,901,129.36 |
| Education surcharge | 24,458,728.04 | 26,242,191.32 |
| Housing property tax | 5,553,841.54 | 5,391,794.62 |
| Stamp duty | 2,237,616.78 | 1,973,313.90 |
| Vehicle and vessel use tax | 26,065.34 | 30,976.71 |
| Land use tax | 0.00 | 31,962.00 |
| Total | 66,618,104.73 | 70,571,367.91 |
63. Selling expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Advertising and promotion expenses | 457,851,289.50 | 598,096,522.97 |
| Sales and service fees | 554,487,943.73 | 412,328,874.30 |
| Freight | 256,384,472.63 | 245,270,943.55 |
| Employee compensation | 245,718,611.84 | 224,534,314.78 |
| Booth decoration fee | 164,860,080.30 | 203,639,303.27 |
| Promotion fees | 103,809,175.17 | 64,858,401.94 |
| Material consumption | 70,486,201.62 | 75,725,126.64 |
| Traveling expense | 16,293,809.72 | 15,695,016.25 |
| Rental fees | 16,476,876.79 | 5,868,935.83 |
| Business entertainment expenses | 15,290,852.11 | 15,708,580.44 |
| Intermediary service charge | 11,520,390.31 | 20,437,960.62 |
| Office allowance | 10,496,374.50 | 10,079,778.20 |
| Other | 4,583,094.13 | 17,613,020.66 |
| Total | 1,928,259,172.35 | 1,909,856,779.45 |
64. Management costs
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Employee compensation | 153,718,556.87 | 137,103,530.61 |
| Depreciation and amortization | 39,728,076.92 | 37,290,502.83 |
| Consulting service charge | 18,353,153.39 | 18,342,521.93 |
| Maintenance expense | 13,647,891.43 | 19,381,764.29 |
| Rental fees | 9,640,922.28 | 5,126,930.34 |
| Office allowance | 8,545,422.15 | 6,313,499.03 |
| Traveling expense | 7,830,459.53 | 7,947,825.95 |
| Material consumption | 5,933,828.15 | 4,025,142.95 |
| Business entertainment expenses | 5,478,604.83 | 4,214,306.76 |
| Communication expense | 4,846,988.25 | 5,920,348.38 |
| Car fare | 3,671,025.30 | 4,092,124.91 |
| Equity incentive fee | 109,531.25 | 2,165,530.29 |
| Other | 12,859,654.82 | 20,431,089.71 |
| Total | 284,364,115.17 | 272,355,117.98 |
65. Research and development expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Employee compensation | 133,274,242.46 | 127,329,381.75 |
| Direct investment | 126,394,199.48 | 132,231,138.03 |
| Depreciation and amortization | 15,287,792.16 | 13,512,699.01 |
| Design fee | 9,951,440.23 | 6,455,271.91 |
| Other expenses | 14,561,452.21 | 13,898,754.10 |
| Total | 299,469,126.54 | 293,427,244.80 |
66. Financial expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Interest expenditure | 477,352.78 | 0.00 |
| Less: Interest revenue | 84,590,717.34 | 100,908,995.14 |
| Plus: Exchange gain or loss | -293,264.98 | -1,216,582.15 |
| Plus: other expenses | 996,138.29 | 785,045.87 |
| Total | -83,410,491.25 | -101,340,531.42 |
67. Other income
Unit: yuan
| Other sources of income | Amount incurred in current period | Amount incurred in previous period |
| Financial support funds for enterprise cultivation | 45,262,300.00 | 80,115,800.00 |
| Job subsidies and social insurance subsidies | 19,885,371.21 | 939,730.00 |
| Intelligent manufacturing, integrated standardization and new mode application project | 4,345,764.32 | 330,376.26 |
| Performance award of Shanghai Hongkou District Finance Bureau | 4,090,000.00 | 5,020,000.00 |
| Production and construction project of annual production of 2.25 million kitchen appliances | 2,573,781.24 | 2,581,740.78 |
| Construction project of kitchen appliance R&D, design and test center | 2,365,167.24 | 197,097.27 |
| subsidies for R&D investment | 2,156,000.00 | 0.00 |
| Production and construction project of annual production of 1 million kitchen appliances | 1,143,783.96 | 1,143,783.96 |
| Supporting funds for industrial chain improvement in IIT special fund | 958,500.00 | 0.00 |
| Rewards for outstanding economic contribution units of MIIT | 500,000.00 | 0.00 |
| Special subsidies for open economic development in Yuhang District | 499,700.00 | 0.00 |
| Individual income tax service charge refund | 458,689.01 | 1,019,039.68 |
| Subsidies for Zhejiang science and technology awards in 2018 | 300,000.00 | 0.00 |
| Subsidy funds for cloud demonstration enterprises | 300,000.00 | 0.00 |
| Patent subsidy | 218,780.00 | 1,121,300.00 |
| Business development (foreign trade) subsidies | 216,875.00 | 0.00 |
| New-generation environmentally friendly and energy-saving kitchen appliances and production line | 190,650.84 | 190,650.84 |
| Digital intelligent manufacturing workshop of intelligent household appliances | 159,426.72 | 144,466.06 |
| Project of annual production of 2.25 million digital workshops | 103,706.04 | 0.00 |
| Awards for standardization, quality, brand building, etc. | 100,000.00 | 0.00 |
| Special fund for Yuhang e-commerce industry development | 100,000.00 | 0.00 |
| Recycling transformation project | 91,610.16 | 87,276.07 |
| Subsidies for science and technology projects | 80,000.00 | 0.00 |
| Hongkou District Tax Bureau of State Taxation Administration | 76,579.44 | 0.00 |
| Shanghai Hongkou District Investment Promotion Office | 60,000.00 | 0.00 |
| Subsidies for investment project of annual production of 150,000 range hoods | 58,882.80 | 58,882.80 |
| Project of annual 108 embedded kitchen electric appliance products | 56,874.25 | 0.00 |
| Expert workstation | 46,255.68 | 46,255.68 |
| Smart electricity subsidy | 32,000.00 | 0.00 |
| VAT exemption or reduction | 16,500.00 | 0.00 |
| Kitchen appliance R&D, design and test center | 7,624.80 | 7,624.80 |
| Support funds for “three” provincial cultivating pilot enterprises | 0.00 | 5,000,000.00 |
| Steady post subsidies | 0.00 | 547,820.56 |
| Intelligent manufacturing brand building subsidies | 0.00 | 200,000.00 |
| Special fund for open economy in Yuhang District | 0.00 | 133,000.00 |
| Financial support for technological innovation projects in Yuhang District in 2017 | 0.00 | 100,000.00 |
| Special subsidies for Yuhang e-commerce industry development | 0.00 | 100,000.00 |
| Special subsidies | 0.00 | 100,000.00 |
| Subsidies for early elimination of diesel vehicles | 0.00 | 70,000.00 |
68. Investment income
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Revenue from financial products | 111,255,267.10 | 72,775,817.93 |
| Dividend income from other equity instrument investments in the holding period | 14,295,039.38 | |
| long-term equity investment gains measured by employing the equity method | 1,550,487.63 | -1,197,385.79 |
| Investment income from available-for-sale financial assets during the holding period | 10,010,925.28 | |
| Investment income from disposal of available-for-sale financial assets | 0.00 | 6,420,345.00 |
| Total | 127,100,794.11 | 88,009,702.42 |
69. Net exposure hedging gain
70. Gains from fair value change
71. Credit impairment loss
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Notes receivable | -27,416,736.00 | |
| Accounts receivable | -17,613,423.11 | |
| Other receivables | -3,793,172.36 |
| Total | -48,823,331.47 |
72. Assets impairment losses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| I. Loss on bad debts | -15,059,762.05 | |
| II. Loss on inventory valuation | -9,321,963.35 | 0.00 |
| Total | -9,321,963.35 | -15,059,762.05 |
73. Income from disposal of assets
Unit: yuan
| Source of income from disposal of assets | Amount incurred in current period | Amount incurred in previous period |
| Income from disposal of non-current assets | -158,607.19 | 101,198.59 |
| Including: income from disposal of fixed assets | -158,607.19 | 101,198.59 |
| Total | -158,607.19 | 101,198.59 |
74. Non-operating income
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | Amounts recorded in the non-recurring gains and losses of the current period |
| Government subsidies | 1,658,983.38 | 1,611,266.38 | 1,658,983.38 |
| Other | 2,439,247.16 | 764,458.33 | 2,439,247.16 |
| Total | 4,098,230.54 | 2,375,724.71 |
Government subsidies included in current profit and loss:
Unit: yuan
| Subsidized project | Amount incurred in current period | Amount incurred in previous period | Asset/income related |
| Mass entrepreneurship and innovation reward | 1,000,000.00 | 50,000.00 | Income related |
| The Lake public welfare program | 300,000.00 | 0.00 | Income related |
| Wangyin fitter skills master studio | 100,000.00 | 0.00 | Income related |
| Subsidies for municipal technical standard projects | 100,000.00 | 14,000.00 | Income related |
| Government subsidies for undergraduate internship in Hangzhou | 81,183.38 | 0.00 | Income related |
| Fitter skills master studio | 50,000.00 | 0.00 | Income related |
| Liming talent reward | 20,000.00 | 0.00 | Income related |
| Talent project funds | 3,000.00 | 0.00 | Income related |
| Special financial fund for business promotion in Zhejiang in 2018 | 4,800.00 | 0.00 | Income related |
| Capital blue sky action cultivation | 0.00 | 867,266.38 | Income related |
| Awards for standardization, quality, brand building, etc. | 0.00 | 500,000.00 | Income related |
| Sporadic subsidies | 0.00 | 180,000.00 | Income related |
75. Non-operating expenditure
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | Amounts recorded in the non-recurring gains and losses of the current period |
| Loss on damage and scrap of non-current assets | 318,500.98 | 128,723.65 | 318,500.98 |
| External donations | 1,000,000.00 | 1,071,000.00 | 1,000,000.00 |
| Other | 3,005,052.74 | 407,364.57 | 3,005,052.74 |
| Total | 4,323,553.72 | 1,607,088.22 |
76. Income tax expenses
(1) Income tax expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Current income tax expenses | 290,542,610.55 | 233,101,748.86 |
| Deferred income tax expenses | -33,257,490.60 | -14,624,979.37 |
| Total | 257,285,119.95 | 218,476,769.49 |
(2) Accounting profit and income tax expense adjustment process
Unit: yuan
| Item | Amount incurred in current period |
| Total profit | 1,871,530,474.58 |
| Income tax expenses calculated at the appropriate/applicable tax rate | 280,729,571.18 |
| Impact of different tax rates applied on subsidiaries | 1,920,735.33 |
| Impact of income tax before adjustment | 2,238,637.55 |
| Impact of non-taxable income | -232,573.14 |
| Impact of non-deductible costs, expenses and losses | 1,966,918.67 |
| Impact of deductible losses on the use of deferred income tax assets not previously recognized | 0.00 |
| Impact of temporary difference or deductible losses on unrecognized deferred income tax assets in the current period | 1,400.57 |
| Weighted deduction of R&D expenditure | -29,339,570.21 |
| Income tax expenses | 257,285,119.95 |
77. Other comprehensive income
See Note “VI. 30 Other comprehensive income”
78. Cash flow statement items
(1) Other cash received related to operating activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Government subsidies | 120,943,978.04 | 109,278,850.56 |
| Income from deposit interest | 84,590,717.34 | 100,908,995.14 |
| Margin and deposit | 41,884,916.66 | 21,217,953.34 |
| Imprest | 22,993,319.48 | 0.00 |
| L/C deposit | 18,128,307.74 | 0.00 |
| Agent business | 17,388,127.18 | 0.00 |
| Other payments | 7,897,733.58 | 7,011,741.78 |
| Total | 313,827,100.02 | 238,417,540.82 |
Other cash received related to operating activities:
(2) Other cash paid related to operating activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Period charge | 1,590,751,809.98 | 1,563,104,207.52 |
| Margin and deposit | 45,382,283.46 | 0.00 |
| Imprest | 45,532,204.37 | 0.00 |
| Agent business | 13,548,409.12 | 0.00 |
| L/C deposit | 24,475,893.97 | 0.00 |
| Other | 7,125,291.22 | 169,908,834.63 |
| Total | 1,726,815,892.12 | 1,733,013,042.15 |
(3) Other cash received related to investment activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Earnest money for investment | 0.00 | 10,000,000.00 |
| Total | 0.00 | 10,000,000.00 |
(4) Other cash paid related to investment activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Earnest money for investment | 0.00 | 10,000,000.00 |
| Total | 10,000,000.00 |
(5) Other cash received related to financing activities
(6) Other cash paid related to financing activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Repurchase of shares | 0.00 | 83,011.50 |
| Total | 83,011.50 |
79. Further information on cash flow statement
(1) Further information on cash flow statement
Unit: yuan
| Further information | Current amount | Last term amount |
| 1. Reconciliation from net profits to cash flows from operating activities: | -- | -- |
| Net profit | 1,614,245,354.63 | 1,483,847,903.85 |
| Plus: Provision for impairment of assets | 9,321,963.35 | 15,059,762.05 |
| Depreciation of fixed assets, oil and gas assets and productive biological assets | 91,630,120.96 | 84,005,677.76 |
| Amortization of intangible assets | 13,057,457.00 | 10,866,013.34 |
| Amortization of long-term deferred expenses | 4,959,043.17 | 7,093,810.14 |
| Losses on disposal of fixed assets, intangible assets and other long-term assets (gains expressed with “-”) | 158,607.19 | -101,198.59 |
| Loss on retirement of fixed assets (gains expressed with “-”) | 318,500.98 | |
| Financial expenses (gains expressed with “-”) | -535,267.76 | -832,944.26 |
| Investment losses (gains expressed with “-”) | -127,100,794.11 | -88,009,702.42 |
| Decreased in deferred income tax assets (increase expressed with “-”) | -28,638,199.06 | -15,036,127.68 |
| Increase in deferred income tax liabilities (decrease expressed with “-”) | -4,619,291.54 | 411,148.31 |
| Decrease in inventories (increase expressed with “-”) | -1,386,157.52 | -234,210,521.74 |
| Decrease in operating receivables (increase expressed with “-”) | -489,310,440.32 | -356,495,724.84 |
| Increase in operating payables (decrease expressed with “-”) | 424,296,698.46 | 604,984,839.60 |
| Other | 48,823,331.47 | -2,622,624.23 |
| Net cash flow from operating activities | 1,555,220,926.90 | 1,508,960,311.29 |
| 2. Significant investment and financing activities not involving cash deposit and withdrawal: | -- | -- |
| 3. Net changes in cash and cash equivalents: | -- | -- |
| Ending balance of cash | 4,029,296,265.50 | 2,177,219,858.85 |
| Less: Beginning balance of cash | 2,177,219,858.85 | 2,562,788,024.38 |
| Net increase of cash and cash equivalents | 1,852,076,406.65 | -385,568,165.53 |
(2) Net cash paid for obtaining subsidiaries in current period
(3) Net cash from disposal of subsidiaries in current period
(4) Composition of cash and cash equivalents
Unit: yuan
| Item | Ending balance | Beginning balance |
| I. Cash | 4,029,296,265.50 | 2,177,219,858.85 |
| Including: cash on hand | 218,775.77 | 380,338.61 |
| Bank deposit readily available for payment | 4,029,077,489.73 | 2,176,839,520.24 |
| III. Balance of cash and cash equivalents at end of period | 4,029,296,265.50 | 2,177,219,858.85 |
80. Notes to items in statement of owner's equity
State the name of "other" items and the amount of adjustment to the ending balance of previous year:
81. Assets with ownership or use rights restricted
Unit: yuan
| Item | Ending book value | Causes for restriction |
| Monetary capital | 24,825,460.73 | Deposit |
| Total | 24,825,460.73 | -- |
82. Foreign currency monetary items
(1) Foreign currency monetary items
Unit: yuan
| Item | Ending balance in foreign currency | Conversion exchange rate | Ending balance converted to RMB |
| Monetary capital | -- | -- | |
| Including: USD | 4,359,727.66 | 6.9762 | 30,414,332.10 |
| Accounts receivable | -- | -- | |
| Including: USD | 2,759,870.24 | 6.9762 | 19,253,406.77 |
| Euro | 589.60 | 7.8155 | 4,608.02 |
(2) Description of overseas operating entities, including disclosure of main place of businessoverseas, bookkeeping currency and selection basis for important overseas operating entities,and disclosure of the reasons for any change in the bookkeeping currency.
□ Applicable √ Not applicable
83. Hedging
84. Government subsidies
(1) Basic information of government subsidies
Unit: yuan
| Type | Amount | Presented item | Amount recorded in current profit and loss |
| Financial support funds for enterprise cultivation | 45,262,300.00 | Other income | 45,262,300.00 |
| Intelligent manufacturing, integrated standardization and new mode application project | 30,000,000.00 | Deferred income | 4,345,764.32 |
| Job subsidies and social insurance subsidies | 19,885,371.21 | Other income | 19,885,371.21 |
| Technological upgrading project of manufacturing enterprises | 8,300,000.00 | Deferred income | 0.00 |
| Project of annual 108 embedded kitchen electric appliance products | 5,673,700.00 | Deferred income | 56,874.25 |
| Performance award of Shanghai Hongkou District Finance Bureau | 4,090,000.00 | Other income | 4,090,000.00 |
| Production and construction project of annual production of 2.25 million kitchen appliances | 2,573,781.24 | Other income | 2,573,781.24 |
| Construction project of kitchen appliance R&D, design and test center | 2,365,167.24 | Other income | 2,365,167.24 |
| subsidies for R&D investment | 2,156,000.00 | Other income | 2,156,000.00 |
| Production and construction project of annual production of 1 million kitchen appliances | 1,143,783.96 | Other income | 1,143,783.96 |
| Mass entrepreneurship and innovation reward | 1,000,000.00 | Non-operating income | 1,000,000.00 |
| Supporting funds for industrial chain improvement in IIT special | 958,500.00 | Other | 958,500.00 |
| fund | income | ||
| Rewards for outstanding economic contribution units of MIIT | 500,000.00 | Other income | 500,000.00 |
| Special subsidies for open economic development in Yuhang District | 499,700.00 | Other income | 499,700.00 |
| Individual income tax service charge refund | 535,268.45 | Other income | 535,268.45 |
| Subsidies for Zhejiang science and technology awards in 2018 | 300,000.00 | Other income | 300,000.00 |
| Subsidy funds for cloud demonstration enterprises | 300,000.00 | Other income | 300,000.00 |
| The Lake public welfare program | 300,000.00 | Non-operating income | 300,000.00 |
| Patent subsidy | 218,780.00 | Other income | 218,780.00 |
| Business development (foreign trade) subsidies | 216,875.00 | Other income | 216,875.00 |
| New-generation environmentally friendly and energy-saving kitchen appliances and production line | 190,650.84 | Other income | 190,650.84 |
| Digital intelligent manufacturing workshop of intelligent household appliances | 159,426.72 | Other income | 159,426.72 |
| Project of annual production of 2.25 million digital workshops | 103,706.04 | Other income | 103,706.04 |
| Awards for standardization, quality, brand building, etc. | 100,000.00 | Other income | 100,000.00 |
| Special fund for Yuhang e-commerce industry development | 100,000.00 | Other income | 100,000.00 |
| Wangyin fitter skills master studio | 100,000.00 | Non-operating income | 100,000.00 |
| Subsidies for municipal technical standard projects | 100,000.00 | Non-operating income | 100,000.00 |
| Recycling transformation project | 91,610.16 | Other income | 91,610.16 |
| Government subsidies for undergraduate internship in Hangzhou | 81,183.38 | Non-operating income | 81,183.38 |
| Subsidies for science and technology projects | 80,000.00 | Other income | 80,000.00 |
| Shanghai Hongkou District Investment Promotion Office | 60,000.00 | Other income | 60,000.00 |
| Subsidies for investment project of annual production of 150,000 range hoods | 58,882.80 | Other income | 58,882.80 |
| Fitter skills master studio | 50,000.00 | Non-operating income | 50,000.00 |
| Expert workstation | 46,255.68 | Other income | 46,255.68 |
| Smart electricity subsidy | 32,000.00 | Other income | 32,000.00 |
| Talent reward | 20,000.00 | Non-operating income | 20,000.00 |
| VAT exemption or reduction | 16,500.00 | Other income | 16,500.00 |
| Kitchen appliance R&D, design and test center | 7,624.80 | Other income | 7,624.80 |
| Special financial fund for business promotion in Zhejiang in 2018 | 4,800.00 | Non-operating income | 4,800.00 |
| Talent project funds | 3,000.00 | Non-operating income | 3,000.00 |
| Total | 127,684,867.52 | — | 88,113,806.09 |
(2) Return of government subsidies
□ Applicable √ Not applicable
85. Other
VIII. Consolidation scope changesIX. Interests in other entities
1. Interests in a subsidiary
(1) Composition of enterprise group
| Subsidiary name | Main operation site | Registration place | Business nature | Shareholding ratio | Way of obtaining | |
| Direct | Indirect | |||||
| Beijing Robam Electric Appliance Sales Co., Ltd. | Beijing | Beijing | Sales of kitchen electric appliance | 100.00% | 0.00% | Business combination under common |
| products | control | |||||
| Shanghai Robam Electric Appliance Sales Co., Ltd. | Shanghai | Shanghai | Sales of kitchen electric appliance products | 100.00% | 0.00% | Business combination under common control |
| Hangzhou Mingqi Electric Co., Ltd. | Hangzhou | Hangzhou | Sales of kitchen electric appliance products | 100.00% | 0.00% | Acquisition by establishment |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | Shanghai | Shanghai | Sales of kitchen electric appliance products | 51.00% | 0.00% | Acquisition by investment |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Shengzhou | Shengzhou | Production and sales of kitchen electric appliance products | 51.00% | 0.00% | Business combination not under common control |
| Hangzhou Robam Fuchuang Investment Management Co., Ltd. | Hangzhou | Hangzhou | Assets and investment management | 100.00% | 0.00% | Acquisition by establishment |
(2) Important non-wholly owned subsidiary
Unit: yuan
| Subsidiary name | Minority shareholding ratio | Current profits and losses attributable to minority shareholders | Current dividends declared to minority shareholders | Ending balance of minority equity |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 49.00% | 24,517,687.17 | 0.00 | 113,314,534.52 |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 49.00% | -168.94 | 0.00 | -3,333,054.89 |
(3) Main financial information of important non-wholly owned subsidiaries
Unit: yuan
| Subsidiary name | Year-end balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 230,113,578.72 | 85,542,835.32 | 315,656,414.04 | 78,861,987.98 | 5,717,848.25 | 84,579,836.23 |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 5,602.41 | 3,817.31 | 9,419.72 | 6,811,572.56 | 0.00 | 6,811,572.56 |
(Continued Table 1)
| Subsidiary name | Year-beginning balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 186,230,007.04 | 54,982,900.77 | 241,212,907.81 | 49,657,712.19 | 10,337,139.79 | 59,994,851.98 |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 5,842.75 | 3,921.75 | 9,764.50 | 6,811,572.56 | 0.00 | 6,811,572.56 |
(Continued Table 2)
| Subsidiary name | Amount incurred in current year | |||
| Operating income | Net profit | Total comprehensive income | Cash flow from financing activities | |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 229,610,991.10 | 49,858,521.98 | 49,858,521.98 | 69,351,227.07 |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 0.00 | -5,602.28 | -5,602.28 | -229.20 |
(Continued Table 3)
| Subsidiary name | Amount incurred in last year | |||
| Operating income | Net profit | Total comprehensive income | Cash flow from financing activities | |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 104,056,341.59 | 20,962,302.57 | 20,962,302.57 | 43,798,441.15 |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 0.00 | -80,319.34 | -80,319.34 | -4,179.07 |
2. Control of the transaction of the subsidiary even if the owner's equity share in the subsidiarychanges
3. Equity in joint venture arrangement or joint venture
(1) Important cooperative enterprises or joint ventures
| Name of cooperative enterprise or joint venture | Main operation site | Registration place | Business nature | Shareholding ratio | Accounting treatment method of investment in cooperative enterprises or joint ventures | |
| Direct | Indirect | |||||
| De Dietrich Trade (Shanghai) Co., Ltd. | Shanghai | Shanghai | Sales of kitchen appliances | 51.00% | 0.00% | Equity method |
(2) Major financial information of important cooperative enterprises
(3) Major financial information of important joint ventures
(4) Summary of financial information of unimportant cooperative enterprises and joint ventures
Unit: yuan
| Ending balance/amount incurred in current period | Beginning balance/amount incurred in previous period | |
| Cooperative enterprise: | -- | -- |
| Total book value of investment | 4,168,338.79 | 2,617,851.16 |
| Total number of following items by shareholding ratio | -- | -- |
| - Net profit | 1,550,487.63 | -762,017.74 |
| - Total comprehensive income | 1,550,487.63 | -762,017.74 |
| - Joint venture: | -- | -- |
| Total number of following items by shareholding ratio | -- | -- |
4. Important pooling of interests
5. Equity in the structured entity that is not included in the consolidated financial statements
6. Other
X. Risks associated with financial instrumentsThe main financial instruments of the Company include accounts receivable, accounts payable, etc. The detaileddescription of the financial instruments is shown in Note VI. The risks associated with these financial instruments and therisk management policies adopted by the Company to mitigate these risks are described below. The management of theCompany shall manage and monitor these risk exposures to ensure that the above risks are controlled within the limitedscope.The Company's various risk management objectives and policies are as follows:
The Company’s risk management is to strike an appropriate balance between risks and benefits, minimize the negativeimpact of risks on the Company's business performance and maximize the interests of shareholders and other equityinvestors. Based on this risk management objective, the basic strategy of the Company's risk management is to determineand analyze various risks faced by the Company, establish an appropriate bottom line for risk tolerance, make riskmanagement and timely and reliably supervise various risks to control the risks within the limited scope.Market risk - price risk: the Company sells the products at market prices and are therefore subject to fluctuations in theseprices.Credit risk: the largest credit risk exposure that may cause financial losses of the Company on December 31, 2019 mainlycomes from the loss of financial assets of the Company caused by the failure of the other party to fulfill its obligations,including the book value of financial assets recognized in the consolidated balance sheet. In order to reduce credit risks,the Company shall assign special personnel to determine the credit limit, conduct credit examination and approval, andimplement other monitoring procedures to ensure that necessary measures are taken to recover overdue claims.Moreover, the Company shall review the recovery of each single receivable on each balance sheet date to ensure thatadequate bad debt provisions are withdrawn for unrecoverable amounts. Therefore, the Company's managementbelieves that the Company's credit risk has been greatly reduced.The Company's working capital is deposited in banks with high credit rating, so the credit risk of working capital is low.There is no significant credit concentration risk due to the Company's risk exposure to multiple parties and customers. TheCompany has adopted the necessary policies to ensure that all sales customers have good credit records. The Companyhas no significant credit concentration risk.Liquidity risk: the risk that the Company is unable to perform its financial obligations at maturity. The Company managesits liquidity risk by ensuring that it has sufficient liquidity to meet maturing obligations without causing unacceptable lossesor damage to the credibility of the business. The Company regularly analyzes the debt structure and maturity to ensureadequate funding.Foreign exchange risk: the Company's exchange rate risk is mainly related to US dollar, Euro, Hong Kong dollar and othercurrencies. The foreign exchange risk borne by the Company is mainly related to USD (which shall be modified accordingto the actual situation), and the main business activities of the Company are denominated and settled in RMB. As ofDecember 31, 2019, the Company's assets and liabilities were RMB balance, except the foreign currency balance of theassets and liabilities in Note “VI. 50 Foreign currency monetary items”. The foreign exchange risks arising from the assetsand liabilities of such foreign currency balance may have an impact on the Company's business performance.
The Company pays close attention to the exchange rate movement on its foreign exchange risks. and has not taken anymeasures to avoid foreign exchange risks.
XI. Fair value disclosure
1. Ending fair value of assets and liabilities measured with fair value
Unit: yuan
| Item | Ending fair value | |||
| Measurement of fair value at the first level | Measurement of fair value at the second level | Measurement of fair value at the third level | Total | |
| I. Continuous fair value measurement | -- | -- | -- | -- |
| (I) Trading financial assets | 1,360,000,000.00 | 1,360,000,000.00 | ||
| 1. FVTPL | 1,360,000,000.00 | 1,360,000,000.00 | ||
| (2) Equity instrument investment | 1,360,000,000.00 | 1,360,000,000.00 | ||
| (III) Other equity instrument investments | 102,116,023.22 | 102,116,023.22 | ||
| Total liabilities measured with fair value continuously | 1,462,116,023.22 | 1,462,116,023.22 | ||
| II. Non-continuous fair value measurement | -- | -- | -- | -- |
2. Continuous and non-continuous measurement items of fair value at first level and recognitionbasis for market price
3. Continuous and non-continuous measurement items of fair value at second level, qualitativeand quantitative information on valuation techniques adopted and important parameters
4. Continuous and non-continuous measurement items of fair value at third level, qualitative andquantitative information on valuation techniques adopted and important parameters
| Item | December 31, 2019 Fair value | Valuation technique | Significant unobservable value | Relationship between unobservable value and fair value |
| Bank financial products | 1,360,000,000.00 | Best estimate of fair value | Investment | — |
| cost | ||||
| Other equity instrument investments | 102,116,023.22 | Best estimate of fair value | Investment cost | — |
XII. Related parties and related transactions
1. Parent company of the Company
| Parent company name | Registration place | Business nature | Registered capital | Shareholding ratio of the parent company in the Company | Voting right ratio of the parent company in the Company |
| Hangzhou Robam Industrial Group Co., Ltd. | Hangzhou, Zhejiang | Investment and industrial management | RMB 60 million | 49.68% | 49.68% |
2. Subsidiaries of the Company
See Note “VII 1.(1) Composition of enterprise group” for the details of the subsidiaries.
3. Cooperative enterprises and joint ventures
See Note “VII. 2.(1) Important cooperative enterprises” for important cooperative enterprises or joint ventures of theCompany.Other cooperative enterprises or joint ventures that made related party transactions with the Company in the currentperiod, or formed the balance of related party transactions with the Company in the previous periods are as follows:
| Name of cooperative enterprise or joint venture | Relationship with the Company |
| Hangzhou Amblem Kitchen Ware Co., Ltd. | Controlled by the same parent company |
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Controlled by the same parent company |
| Hangzhou Nbond Nonwoven Co., Ltd. | Controlled by the same parent company |
| Hangzhou Yuhang Matt Spray Painting Factory | Controlled by the sister of the actual controller |
| Garden Hotel Hangzhou | Greatly influenced by the parent company |
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Controlled by the same parent company |
| Shaoxing Kinde Electric Appliance Co., Ltd. | Other shareholders of subsidiaries controlled by the Company |
4. Situation of other related parties
5. Related transaction
(1) Related transaction of purchases and sales of goods, provision and acceptance of services
Purchase of goods/acceptance of services
Unit: yuan
| Related party | Related transaction content | Amount incurred in current period | Whether the transaction quota is exceeded | Amount incurred in previous period |
| Hangzhou Yuhang Matt Spray Painting Factory | Labor receiving | 13,955,880.37 | No | 12,571,467.08 |
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Product purchase | 3,616,184.73 | No | 1,737,197.21 |
| Hangzhou Amblem Kitchen Ware Co., Ltd. | Labor receiving | 1,993,224.66 | No | 6,553,123.09 |
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Product purchase | 1,008,020.11 | No | 3,413,283.77 |
| Garden Hotel Hangzhou | Labor receiving | 16,466.04 | No | 39,753.96 |
| Hangzhou Nbond Nonwoven Co., Ltd. | Product purchase | 39,765.92 | No | 41,127.07 |
| De Dietrich Trade (Shanghai) Co., Ltd. | Product purchase | 4,513.27 | No | 14,998.97 |
Selling commodities/offering labor
Unit: yuan
| Related party | Related transaction content | Amount incurred in current period | Amount incurred in previous period |
| Shaoxing Kinde Electric Appliance Co., Ltd. | Selling goods | 24,532,147.26 | 21,614,576.05 |
| Hangzhou Amblem Kitchen Ware Co., Ltd. | Selling goods | 10,855,275.49 | 10,763,379.76 |
| De Dietrich Trade (Shanghai) Co., Ltd. | Selling goods | 68,820.97 | 3,633,988.60 |
(2) Associated fiduciary management/contracting and entrusted management/subcontracting
(3) Related-party lease
The Company as the lessor:
Unit: yuan
| Name of lessee | Type of leased assets | Lease income recognized in the current period | Lease income recognized in the previous period |
| Hangzhou Robam Industrial Group Co., Ltd. | House | 28,800.00 | 28,800.00 |
The Company as the lessee:
Unit: yuan
| Name of lessor | Type of leased assets | Lease fee recognized in the current period | Lease fee recognized in the previous period |
| Hangzhou Robam Industrial Group Co., Ltd. | House | 550,024.57 | 550,024.57 |
(4) Related-party guarantee
(5) Related party loan at call
(6) Asset transfer and debt restructuring of related party
(7) Key management personnel remuneration
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Total remuneration | 9,823,762 | 9,272,300.00 |
(8) Other related transactions
6. Accounts receivable and payable by related parties
(1) Receivables
Unit: yuan
| Item name | Related party | Ending balance | Beginning balance | ||
| Book balance | Provision for bad debt | Book balance | Provision for bad debt | ||
| Accounts | Shaoxing Kinde Electric Appliance | 0.00 | 5,847,688.80 | ||
| receivable | Co., Ltd. | ||||
| Advance to supplier | Hangzhou Amblem Kitchen Ware Co., Ltd. | 50,000.00 | 0.00 | ||
| Advance to supplier | Shaoxing Kinde Electric Appliance Co., Ltd. | 580,130.26 | 0.00 |
(2) Payables
Unit: yuan
| Item name | Related party | Ending book balance | Beginning book balance |
| Accounts payable | Hangzhou Yuhang Matt Spray Painting Factory | 4,525,094.50 | 4,224,367.40 |
| Accounts payable | Hangzhou Yuhang Robam Gas Station Co., Ltd. | 1,490,945.55 | 1,238,869.31 |
| Accounts payable | Shaoxing Kinde Electric Appliance Co., Ltd. | 57,552.91 | 0.00 |
| Accounts payable | Hangzhou Amblem Kitchen Ware Co., Ltd. | 1,841.61 | 916,666.81 |
| Accounts payable | Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | 0.00 | 148,644.89 |
| Advance from customers | Hangzhou Amblem Kitchen Ware Co., Ltd. | 139,622.44 | 0.00 |
| Other payables | Hangzhou Yuhang Matt Spray Painting Factory | 200,000.00 | 200,000.00 |
7. Related party commitment
8. Other
XIII. Share-based payment
1. Overall status of share-based payment
The Company’s second meeting of the third Board of Supervisors on September 9, 2014 reviewed and adopted theProposal on the Initial Restricted Stock Incentive Plan (Draft) (hereinafter referred to as the “plan” or “plan draft”). Thenumber of restricted stocks to be granted under the plan was 4.5million, and the actual number of restricted stocksgranted was 4.48 million, accounting for 1.40% of the total 320 million stocks of the Company on the announcement dateof the plan draft abstract. Where, 4.07 million stocks were planned to the granted in the first time and 4.05 million stockswere granted actually, accounting for 1.27% of the total stocks of the Company on the announcement date of the plandraft abstract; 430,000 stocks were reserved, accounting for 0.13% of the total stocks of the Company on the
announcement date of the plan draft abstract and 9.60% of the total restricted stocks granted this time. The reserved partwill be granted within one year after the first grant date of the plan.The plan shall be valid for up to five years from the date of the initial grant of restricted stocks.
(1) The incentive object shall be locked up within 12 months from the date of receiving the restricted stocks. During thelockup period, the restricted stocks granted to the incentive object under the plan are locked and non-transferable;
(2) Upon the expiration of 12 months from the date of the initial grant of the incentive plan, the restricted stock first grantedunder this plan shall be unlocked by the incentive object in three times over the next 36 months. During the unlockingperiod, if the unlocking conditions stipulated in this plan are satisfied, the incentive object may apply for unlocking in threetimes: the first unlocking period is the first year after the expiration of the lockup period and the incentive object may applyfor unlocking 30% of the total number of restricted stocks granted; the second unlocking period is the second year afterthe expiration of the lockup period and the incentive object may apply for unlocking 40% of the total number of restrictedstocks granted; the third unlocking period is the third year after the expiration of the lockup period and the incentive objectmay apply for unlocking 30% of the total number of restricted stocks granted. Upon the expiration of 12 months from thedate of the corresponding grant date, the restricted stocks reserved shall be unlocked by the incentive object in threetimes over the next 36 months. The first unlocking period is the first year after the expiration of the lockup period and theincentive object may apply for unlocking 30% of the total number of restricted stocks granted; the second unlocking periodis the second year after the expiration of the lockup period and the incentive object may apply for unlocking 40% of thetotal number of restricted stocks granted; the third unlocking period is the third year after the expiration of the lockupperiod and the incentive object may apply for unlocking 30% of the total number of restricted stocks granted.The incentive objects of the plan are the Company's directors, middle and senior management, as well as the corebusiness (technical) personnel identified by the Company. The price of restricted stock granted to incentive objects for thefirst time is 15.16 yuan per stock.For the restricted stock granted in the plan for the first time, the performance conditions of the incentive object for eachapplication for the unlocking of the underlying stocks are as follows:
(1) Taking the net profit in 2013 as a fixed basic number, the net profit growth rate of the Company in 2014, 2015 and 2016shall be no less than 30%, 65% and 110% respectively;
(2) The return on equity in 2014, 2015 and 2016 shall be no less than 20%;
(3) During the lockup period, the net profits attributable to shareholders of listed companies and the net profits attributableto shareholders of the listed company after deduction of non-recurring profits and losses shall not be negative and not belower than the average level of the last three fiscal years before the grant date.For the restricted stock reserved to grant in the plan, the performance conditions of the incentive object for eachapplication for the unlocking of the underlying stocks are as follows:
(1) Taking the net profit in 2013 as a fixed basic number, the net profit growth rate of the Company in 2015, 2016 and 2017shall be no less than 65%, 110% and 160% respectively;
(2) The return on equity in 2015, 2016 and 2017 shall be no less than 20%;
(3) During the lockup period, the net profits attributable to shareholders of listed companies and the net profits attributableto shareholders of the listed company after deduction of non-recurring profits and losses shall not be negative and not belower than the average level of the last three fiscal years before the grant date. The above indexes of net profit growth rateand return on equity are calculated based on the net profit after deducting non-recurring profits and losses.The net profitsand net assets each year refer to the net profits attributable to shareholders of listed companies and net assetsattributable to shareholders of listed companies. If the Company conducts public offering or non-public offering and otherbehaviors affecting the Company’s net assets, the newly increased net assets and the net profits generated from such netassets shall not be subject to the assessment calculation of the year and the next year. In case of capital surplus transferto capital stock, distribution of stock dividends, stock split or drawing back, stock allotment or dividend distribution of theCompany in the period from the announcement date of the plan to completion of the restricted stock registration by theincentive object, the grant price and quantity of the restricted stocks will be adjusted accordingly.On January 4, 2016, the Company’s 12th meeting of the third Board of Directors reviewed and adopted the Proposal onGranting Reserved Restricted Stocks to Incentive Objects. On January 4, 2016, 645,000 reserved restricted stocks weregranted to 29 incentive objects, at the grant price of 21.25yuan per stock.In this equity incentive plan, the fair value on the grant date was recognized in stages as the administrative expenses foreach year according to the unlocking ratio during the waiting period, where, the administrative expenses were 109,531.25yuan in 2019.XIV. Commitment and contingencies
1. Important commitment issues
The Company had no significant contingencies to be disclosed as of December 31, 2019.
2. Contingencies
The Company had no significant contingencies to be disclosed as of December 31, 2019.
3. Other
XV. Post-balance sheet events
1. Dividend distribution
At the Company’s 14th meeting of the 4th Board of Directors on April 27, 2020, the ProfitDistribution Plan for 2019 was approved. Based on the total share capital of 949,024,050.00 as atDecember 31, 2019, the Company intends to pay a cash dividend of 5.00 yuan (tax included) per 10shares to all shareholders, for a total of 474,512,025.00 yuan.
2. Except for the aforementioned post balance sheet events, the Company has no other majorpost-balance sheet events as of the date of presentation of the financial statements.
XVI. Other important issuesXVII. Notes on main items of parent company's financial statement
1. Accounts receivable
(1) Classified disclosure of accounts receivable
Unit: yuan
| Category | Ending balance | Beginning balance | ||||||||
| Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
| Amount | Proportion | Amount | Accruing proportion | Amount | Proportion | Amount | Accruing proportion | |||
| Where: | ||||||||||
| Accounts receivable of provision for bad debt by combination | 743,804,053.68 | 100.00% | 39,557,168.87 | 704,246,884.81 | 461,115,475.92 | 100.00% | 23,113,083.26 | 438,002,392.66 | ||
| Where: | ||||||||||
| Combination of related party | 22,246,710.00 | 2.99% | 0.00 | 0.00% | 22,246,710.00 | 51,615,939.00 | 11.19% | 0.00 | 0.00% | 51,615,939.00 |
| Withdrawal of receivables of provision for bad debt by combination of | 721,557,343.68 | 97.01% | 39,557,168.87 | 5.48% | 682,000,174.81 | 409,499,536.92 | 88.81% | 23,113,083.26 | 5.64% | 386,386,453.66 |
| credit risk characteristics | ||||||||||
| Total | 743,804,053.68 | 100.00% | 39,557,168.87 | 704,246,884.81 | 461,115,475.92 | 100.00% | 23,113,083.26 | 438,002,392.66 |
Provision for bad debt by combination: accounts receivable of provision for bad debt by expected credit loss combinationbased on aging features
Unit: yuan
| Name | Ending balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Within 1 year | 699,383,860.07 | 34,969,193.00 | 5.00% |
| 1-2 years | 13,429,708.82 | 1,342,970.88 | 10.00% |
| 2-3 years | 5,963,824.77 | 1,192,764.95 | 20.00% |
| 3-4 years | 992,283.36 | 496,141.68 | 50.00% |
| 4-5 years | 1,157,841.52 | 926,273.22 | 80.00% |
| More than 5 years | 629,825.14 | 629,825.14 | 100.00% |
| Total | 721,557,343.68 | 39,557,168.87 | -- |
Unit: yuan
| Name | Ending balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Combination of related party | 22,246,710.00 | 0.00 | 0.00% |
| Total | 22,246,710.00 | -- | |
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 721,630,570.07 |
| 1~2 years | 13,429,708.82 |
| 2~3 years | 5,963,824.77 |
| More than 3 years | 2,779,950.02 |
| 3~4 years | 992,283.36 |
| 4~5 years | 1,157,841.52 |
| More than 5 years | 629,825.14 |
| Total | 743,804,053.68 |
（2）Provision, recovery or reversal of bad debt reserves in the current period
| Category | Year-beginning balance | Amount of change in current year | Year-end balance | ||
| Provision | Recovered or reversed | Write-off canceled after verification | |||
| Provision for bad debt of accounts receivable | 23,113,083.26 | 16,543,789.45 | 0.00 | 99,703.84 | 39,557,168.87 |
| Total | 23,113,083.26 | 16,543,789.45 | 0.00 | 99,703.84 | 39,557,168.87 |
(3) Accounts receivable actually written off at the current period
Unit: yuan
| Item | Write-off amount | Cause for write-off | Write-off procedure |
| Accounts receivable written off actually | 99,703.84 | Expected irrecoverable | Approval by management |
(4) Receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Ending balance of accounts receivable | Proportion in total ending balance of accounts receivable | Ending balance of bad debt provision |
| Unit 1 | 132,784,858.17 | 17.85% | 6,639,242.91 |
| Unit 2 | 99,432,833.64 | 13.37% | 4,971,641.68 |
| Unit 3 | 93,445,059.93 | 12.56% | 4,672,253.00 |
| Unit 4 | 22,246,710.00 | 2.99% | 0.00 |
| Unit 5 | 16,985,591.40 | 2.29% | 849,279.57 |
| Total | 364,895,053.14 | 49.06% |
2. Other receivables
Unit: yuan
| Item | Ending balance | Beginning balance |
| Interest receivable | 0.00 | |
| Dividends receivable | 14,295,039.38 | 0.00 |
| Other receivables | 91,471,115.57 | 64,301,240.95 |
| Total | 105,766,154.95 | 64,301,240.95 |
(2) Dividends receivable
1) Classification of dividends receivable
Unit: yuan
| Project (or investee) | Ending balance | Beginning balance |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 14,295,039.38 | 0.00 |
| Total | 14,295,039.38 | 0.00 |
(2) Other receivables
1) Other receivables classified by nature
Unit: yuan
| Nature of payment | Ending book balance | Beginning book balance |
| Collection by third party | 63,604,415.88 | 30,291,539.08 |
| Deposit and margin | 32,288,103.90 | 29,692,522.35 |
| Associated contact | 4,064,000.00 | 4,064,000.00 |
| Imprest | 1,572,298.56 | 1,239,473.08 |
| Withheld amount | 2,174,992.54 | 2,232,820.64 |
| Other | 457,769.11 | 5,986,841.54 |
| Total | 104,161,579.99 | 73,507,196.69 |
2) Provision for bad debt
Unit: yuan
| Provision for bad debt | Stage 1 | Stage 2 | Stage 3 | Total |
| Expected credit losses over the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment has occurred) | ||
| Balance on January 1, 2019 | 9,205,955.74 | 9,205,955.74 | ||
| Balance on January 1, 2019 in current period | —— | —— | —— | —— |
| Withdrawn in current period | 3,484,508.68 | 3,484,508.68 |
| Balance on December 31, 2019 | 12,690,464.42 | 12,690,464.42 |
Large book balance change in the current period of provision for loss
□ Applicable √ Not applicable
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 76,928,134.47 |
| 1~2 years | 4,285,243.02 |
| 2~3 years | 17,717,971.10 |
| More than 3 years | 5,230,231.40 |
| 3~4 years | 609,086.46 |
| 4~5 years | 268,744.94 |
| More than 5 years | 4,352,400.00 |
| Total | 104,161,579.99 |
3) Provision, recovery or reversal of bad debt reserves in the current period
The amount of provision for bad debts was 3,484,508.68 yuan in current year; and the amount ofprovision for bad debts recovered or reversed was 0.00yuan in the current period.
4) Other receivables actually written off at the current period
5) Other receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Nature of payment | Ending balance | Aging | Proportion in total other ending balance receivable | Ending balance of bad debt provision |
| Unit 1 | Collection by third party | 56,941,569.55 | Within 1 year | 54.67% | 2,847,078.48 |
| Unit 2 | Deposit and margin | 14,778,000.00 | 2-3 years | 13.82% | 2,955,600.00 |
| Unit 3 | Associated contact | 4,064,000.00 | More than 5 years | 3.80% | 4,064,000.00 |
| Unit 4 | Deposit and | 3,000,000.00 | Within 1 | 2.81% | 150,000.00 |
| margin | year | ||||
| Unit 5 | Deposit and margin | 1,520,225.00 | 2-3 years | 1.42% | 304,045.00 |
| Total | -- | 80,303,794.55 | -- | 76.52% | 10,320,723.48 |
3. Long-term equity investments
Unit: yuan
| Item | Ending balance | Beginning balance | ||||
| Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
| Investment in subsidiaries | 246,905,933.73 | 20,400,000.00 | 226,505,933.73 | 242,391,037.48 | 20,400,000.00 | 221,991,037.48 |
| Investment in associated enterprises and joint enterprises | 4,168,338.79 | 0.00 | 4,168,338.79 | 2,617,851.16 | 0.00 | 2,617,851.16 |
| Total | 251,074,272.52 | 20,400,000.00 | 230,674,272.52 | 245,008,888.64 | 20,400,000.00 | 224,608,888.64 |
(1) Investment in subsidiaries
Unit: yuan
| Invested unit | Beginning balance (book value) | Increase or decrease in current period | Ending balance (book value) | Balance of impairment provision at the end of period | |||
| Further investment | Capital reduction | Provision for impairment | Other | ||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 162,320,000.00 | 0.00 | 0.00 | 0.00 | 162,320,000.00 | ||
| Hangzhou Mingqi Electric Co., | 51,892,142.06 | 9,638.75 | 0.00 | 0.00 | 51,901,780.81 | ||
| Ltd. | |||||||
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 625,642.50 | 5,257.50 | 0.00 | 0.00 | 630,900.00 | 20,400,000.00 | |
| Shanghai Robam Electric Appliance Sales Co., Ltd. | 5,838,272.10 | 0.00 | 0.00 | 0.00 | 5,838,272.10 | ||
| Beijing Robam Electric Appliance Sales Co., Ltd. | 1,314,980.82 | 4,500,000.00 | 0.00 | 0.00 | 5,814,980.82 | ||
| Total | 221,991,037.48 | 4,514,896.25 | 226,505,933.73 | 20,400,000.00 |
(2) Investment in associated enterprises and joint enterprises
Unit: yuan
| Invested entity | Beginning balance (book value) | Increase or decrease in current period | Ending balance (book value) | Balance of impairment provision at the end of period | |||||||
| Further investment | Capital reduction | Investment gains and losses recognized by the equity method | Adjustment of other comprehensive income | Changes in other equity | Declared payment of cash dividends or profits | Provision for impairment | Other | ||||
| I. Joint enterprise | |||||||||||
| De Dietrich Trade (Shanghai) | 2,617,851.16 | 0.00 | 0.00 | 1,550,487.63 | 0.00 | 0.00 | 0.00 | 0.00 | 4,168,338.79 | ||
| Co., Ltd. | |||||||||||
| Subtotal | 2,617,851.16 | 1,550,487.63 | 4,168,338.79 | ||||||||
| II. Joint venture | |||||||||||
| Total | 2,617,851.16 | 1,550,487.63 | 4,168,338.79 | 0.00 | |||||||
4. Operating income and operating cost
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 7,010,004,348.48 | 3,315,886,553.65 | 6,756,258,309.67 | 3,270,885,911.41 |
| Other businesses | 161,269,622.80 | 64,568,317.30 | 194,869,275.13 | 89,049,587.53 |
| Total | 7,171,273,971.28 | 3,380,454,870.95 | 6,951,127,584.80 | 3,359,935,498.94 |
5. Investment income
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Investment income from purchasing financial products | 102,743,555.45 | 72,490,431.64 |
| Dividend income from other equity instrument investments in the holding period | 14,295,039.38 | |
| long-term equity investment gains measured by employing the equity method | 1,550,487.63 | -1,197,385.79 |
| Investment income from available-for-sale financial assets during the holding period | 10,010,925.28 | |
| Investment income from disposal of available-for-sale financial assets | 0.00 | 6,420,345.00 |
| Total | 118,589,082.46 | 87,724,316.13 |
XVIII. Further information
1. Current non-recurring gain and loss statement
√Applicable □ Not applicable
Unit: yuan
| Item | Amount | Description |
| Profit and loss on disposal of non-current assets | -158,607.19 | |
| Government subsidies included into the current profits and losses, except those government subsidies, which are closely related to the business of a company and enjoyed in accordance with a certain standard quota or quantity of the state | 88,113,806.09 | |
| Income and expenditure other than those mentioned above | -1,884,306.56 | |
| Less: Amount affected by income tax | 13,290,725.11 | |
| Amount of minority shareholders' equity affected | -54,849.79 | |
| Total | 72,835,017.02 | -- |
Explain the non-recurrent profit and loss items defined by the Company according to the Interpretative Announcement No.1 on Information Disclosure of Public Securities Issuing Companies - Non-recurrent Profits and Losses and defined fromthe non-recurrent profit and loss items enumerated in the Interpretative Announcement No. 1 on Information Disclosure ofPublic Securities Issuing Companies - Non-recurrent Profits and Losses.
□ Applicable √ Not applicable
2. Return on net assets and earnings per share
| Reporting profit | Weighted average return on net assets | Earnings Per Share | |
| Basic EPS (yuan/share) | Diluted EPS (yuan/share) | ||
| Net profit attributable to common shareholders of the Company | 25.10% | 1.68 | 1.68 |
| Net profit attributable to common shareholders of the Company after deduction of non-recurring profits and losses | 23.95% | 1.60 | 1.60 |
3. Differences in Accounting Data under Domestic and Foreign Accounting Standards
(1) Differences between net profits and net assets in financial statements disclosed according tothe International Accounting Standards (IAS) and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
(2) Differences between net profits and net assets in financial statements disclosed according tothe Overseas Accounting Standards and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
(3) Causes for differences in accounting data under domestic and foreign accounting standards.If the difference adjustment has been made to the data audited by the overseas audit institution,the name of the overseas audit institution shall be indicated
4. Other
Section 13: Reference file directoryI. Financial statements containing signatures of the legal representative, the head of accounting work,and the head of accounting body with seals.II. Original audit report stamped by ShineWing Certified Public Accountants (Special general partnership)and signed and stamped with the certified public accountants.III. Original copies of the documents and announcement of the Company published on the newspaperdesignated by the CSRC in the reporting period.IV. 2019 annual report of the Company signed by the legal representative.V. Other Relevant InformationVI. Reference files kept at: board office.