SHENZHEN TELLUS HOLDING CO., LTD.
Semi-Annual Report 2022
August 2022
Section I. Important Notice, Contents and Interpretation
Board of Directors, Supervisory Committee, all directors, supervisors and seniorexecutives of Shenzhen Tellus Holding Co., Ltd. (hereinafter referred to as theCompany) hereby confirm that there are no any fictitious statements, misleadingstatements, or important omissions carried in this report, and shall take allresponsibilities, individual and/or joint, for the reality, accuracy and completionof the whole contents.
Fu Chunlong, Principal of the Company, Lou Hong, person in charge ofaccounting works and Lou Hong, person in charge of accounting organ(accounting principal) hereby confirm that the Financial Report of Semi-AnnualReport 2022 is authentic, accurate and complete.
All directors are attended the Board Meeting for report deliberation.The possible risks faced by the Company have been well-described in the Report,investors are advised to pay attention to them. Be sure to note that in “X. Risks ofthe Company and countermeasures” contained in Section III ManagementDiscussion and Analysis.The Company plans not to pay cash dividends, not to issue bonus and not toincrease the share capital from accumulation funds.
ContentsSectionIImportantNotice,ContentsandInterpretation................................................-1-SectionIICompanyProfileandMainFinancialIndexes................................................-5-SectionIIIManagementDiscussionandAnalysis..........................................................-9-SectionIVCorporateGovernance........................................................................................-19-SectionVEnviornmentalandSocialResponsibility......................................................-21-SectionVIImportantEvent.................................................................................................-22-SectionVIIChangesinSharesandParticularaboutShareholders.............................-35-SectionVIIIPreferredStock...............................................................................................-40-SectionIXCorporateBonds.................................................................................................-41-SectionXFinancialReport.................................................................................................-42-
| - |
Documents Available for Reference
1. The Accounting Statement containing the signature and seals of the legal representative, the person in charge of
the accounting works and person in charger of the accounting organization.
2. Original copies of all documents and announcements that have been released publicly during the reporting
period.
3.The above documents are available at: office of the Board Secretariat
| - |
Interpretation
| Items | Refers to | Contents |
| CSRC | Refers to | China Securities Regulatory Commission |
| SZE | Refers to | Shenzhen Stock Exchange |
Shenzhen Branch of CSDC Refers to
Clearing Corporation Limited-ShenzhenBranch
| China Securities Depository and | ||
| Company, the Company, our Company, |
Tellus Group
Refers to Shenzhen Tellus Holding Co., Ltd.
| Reporting period, this reporting period | Refers to | January to June of 2022 |
Auto Industry and Trade CompanyRefers to
CorporationZhongtian Company Refers to Shenzhen Zhongtian Industrial Co,. Ltd.GAC Refers to
Shenzhen Auto Industry and TradeGems & Jewelry Trade Association of
ChinaHuari Company, SDG Huari Refers to
| Gems & Jewelry Trade Association of |
| Shenzhen SDG Huari Auto Enterprise |
Co., Ltd.Huari ToyotaRefers to
LtdZung Fu TellusRefers to
| Shenzhen Huari Toyota Auto Sales Co., |
| Shenzhen Zung Fu Tellus Auto Service |
Co., Ltd.Tellus Property Refers to
Management Co., Ltd.
| Shenzhen SDG Tellus Property | ||
| Special Development, SDG, Controlling |
Shareholder
Refers to
Co., Ltd.Treasury Supply Chain Company Refers to
| Shenzhen Special Development Group |
| Shenzhen Tellus Treasury Supply Chain |
Tech. Co., Ltd.Shenzhen Jewelry CompanyRefers to
LTDShanghai FanyueRefers toShanghai Fanyue Diamond Co., Ltd.
| - |
Section II Company Profile and Main Financial Indexes
I. Company profile
| Short form of the stock | Tellus-A, Tellus-B | Stock code | 000025, 200025 |
| Stock exchange for listing | Shenzhen Stock Exchange | ||
| Name of the Company (in | |||
Chinese)
深圳市特力(集团)股份有限公司
(in Chinese)
特力A
| Short form of the Company |
| Foreign name of the |
Company (if applicable)
Shenzhen Tellus Holding Co., Ltd
| Legal representative | Fu Chunlong |
II. Person/Way to contact
| Secretary of the Board | Rep. of security affairs | |
| Name | Qi Peng | Liu Menglei |
Contact add.
Luohu District, Shenzhen
| 3/F, Tellus Building, Shui Bei Er Road, | 3/F, Tellus Building, Shui Bei Er Road, |
Luohu District, Shenzhen
| Tel. | (0755)83989390 | (0755)88394183 |
| Fax. | (0755)83989386 | (0755)83989386 |
| ir@tellus.cn | liuml@tellus.cn |
III. Others
1. Way of contact
Whether registrations address, offices address and codes as well as website and email of the Company changed in reporting period ornot
□ Applicable √ Not applicable
The registrations address, offices address and codes as well as website and email of the Company have no change in reporting period,found more details in Annual Report 2021.
2. Information disclosure and preparation place
Whether information disclosure and preparation place changed in reporting period or not
□ Applicable √ Not applicable
The newspaper appointed for information disclosure, website for semi-annual report publish appointed by CSRC and preparation placefor semi-annual report have no change in reporting period, found more details in Annual Report 2021
3. Other relevant information
Whether other relevant information has changed during the reporting period
| - |
□ Applicable √ Not applicable
IV. Main accounting data and financial indexesWhether it has retroactive adjustment or re-statement on previous accounting data or not
□ Yes √ No
Current period Same period of last year
compared with the sameperiod of the previous year
(+,-)
| Changes in the current period | |||
| Operating revenue (Yuan) | 250,015,152.23 | 249,492,261.24 | 0.21% |
| Net profit attributable to |
shareholders of the listedCompany(Yuan)
43,480,236.19 44,542,715.32 -2.39%
Company after deducting non-
| recurring gains and |
losses(Yuan)
31,023,156.36 41,590,592.47 -25.41%
operating activities(Yuan)
-11,318,295.41 59,571,399.02 -119.00%
| Net cash flow arising from |
| Basic earnings per share |
(RMB/Share)
0.1009 0.1033 -2.32%
(RMB/Share)
0.1009 0.1033 -2.32%
| Diluted earnings per share | |||
| Weighted average ROE | 3.00% | 3.34% | -0.34% |
Current Period-end Period-end of last year
current period compared withthe end of the previous year
| Changes at the end of the | |||
| Total assets (Yuan) | 1,901,811,890.21 | 1,859,645,205.43 | 2.27% |
| Net assets attributable to |
shareholder of listedCompany (Yuan)
1,465,622,963.89 1,432,924,273.45 2.28%
V. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International AccountingStandards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
| - |
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting rules
and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules orChinese GAAP (Generally Accepted Accounting Principles) in the period.
VI. Items and amounts of extraordinary profit (gains)/loss
√Applicable □ Not applicable
Unit: RMB/CNY
| Item | Amount | Note |
| Governmental subsidy calculated into current gains and losses(while closely |
related with the normal business of theCompany, the government subsidy that
policies and are continuously enjoyed in
| line with a certain standard quota or |
quantity are excluded)
1,575,990.30 The government subsidy
from holding of
| the trading financial asset, trading financial liability and investment earnings obtained from disposing the trading financial asset, |
trading financial liability, and financialassets available for sale, except for theeffective hedging bu
normal operation of the Company
6,157,679.97 Financial income
| siness related to |
| Other non-operating income and |
expenditure except for theaforementioned items
295,569.76
operating income upon early surrender oflease by the tenant
| The leasing deposit transferred to non- | ||
| Gain/loss on transfer of equity | 8,785,410.47 | |
| Less: Impact on income tax | 4,124,792.46 | |
| Impact on minority shareholders’ |
equity (post-tax)
232,778.21
| Total | 12,457,079.83 |
Details of other gains/losses items that meets the definition of non-recurring gains/losses:
□ Applicable √ Not applicable
There are no other gains/losses items that meet the definition of non-recurring gains/losses in the Company.
Explain the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A AnnouncementNo.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss
□ Applicable √ Not applicable
| - |
There are no items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A AnnouncementNo.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss
| - |
Section III Management Discussion and AnalysisI. Main businesses of the Company during the reporting periodThe main business of the Company during the reporting period was jewelry service business; commercialoperation management; sales, testing and maintenance of motor vehicle and accessories sales.
Jewelry service business: At present, the integration of all subdivisions of the jewelry service business has achievedinitial results, and the overall solution integrating the service contents of all subdivisions has gradually gainedmarket recognition. In the first half of 2022, the company invested in the establishment of a gold circulation platform,which aims to break through the bottleneck of domestic gold circulation, solve the pain points of the gold circulationindustry, standardize the industry service standards, and further improve the company's layout in the gold jewelryindustry.
Commercial operation management: In 2022, the effect of Tellus Gman Gold Jewelry Industrial Park on the Shuibeijewelry industry continues to expand, especially that the headquarters of leading enterprises in the jewelry industrycontinue to gather in the park, the occupancy rate and rental price level of the park have an advantage over thosearound the park. As the largest owner of the park, the company continuously improves the operation system,enhances service quality, and seizes opportunities to actively expand customers. As the last Grade A office buildingof the company, Tellus Jinzuan Trading Building has achieved good results in preparatory investments attractiondespite the double strike of the pandemic and the poor prosperity of the jewelry industry.
Automobile sales, testing, maintenance and parts sales: The company's automobile business is mainly operatingFAW Toyota 4S stores. Affected by the repeated and sporadic pandemics in Shenzhen, the impact of new energyvehicles, and the late introduction of the regional subsidy policy for stores, the new car sales volume decreasedslightly on a year-on-year basis.
II. Core Competitiveness Analysis
1.Solidly promoted the third-party ecosystem construction of the jewelry, which rapidly improved the company's
popularity and influence in the jewelry industry.
Relying on the physical platform resources in the Shuibei area, where the jewelry industry gathers, the companygives full play to the credit advantages of a state-owned listed company, constantly tries to innovate business models,steadily promotes the implementation of transformation projects, deeply penetrates into the jewelry industry chain,and enables the third-party business of jewelry to achieve leapfrog development. In 2019, Shenzhen Tellus TreasurySupply Chain Tech. Co., Ltd. was established to carry out jewelry supply chain business, which consolidated thethird-party service foundation for jewelry. Established Shenzhen Jewelry Industry Service Co., Ltd in 2020 to
| 10 |
provide services such as bonded exhibition, bonded warehousing, testing,customs declaration, logistics, andsettlement, which shall be built into a comprehensive element trading service platform with international influenceintegrating jewelry raw materials and finished products exhibition, spot trading, identification, design, processing,e-commerce, financial services, insurance and so on. The successful operation of Shen Jewelry has been highlyrecognized by the municipal and district governments and the customs in Shenzhen, which has enhanced thecompany's position in the jewelry industry chain. In 2021, the company established Shanghai Fanyue, and realizeda closed loop of diamonds from the bonded display transactions to the general trade import. In the first half of 2022,the company invested in the establishment of a gold circulation platform - Guorun Gold (Shenzhen) Co., Ltd., whichfurther improved its layout in the gold jewelry industry. With the solid advancement of the strategic transformation,the company's ability and level to provide third-party jewelry services has been continuously improved, and thebrand influence in the national jewelry industry chain has been significantly enhanced, becoming the company'score competitiveness.
2. Possess abundant property resources and provide stable business income and financial support
The Company is the largest owner of the Tellus Gman Gold Jewelry Industrial Park in the Shuibei area, TellusJewelry Building has been fully put into use, and the construction project of the Tellus Jinzuan Trading Building isprogressing as planned. At the same time, the company will construct an innovative industrial projects in Buxin areathat conform to the overall strategic layout of the city, district and the Company through renovation. In addition, theCompany has a large number of property resources in Luohu and Futian district of Shenzhen, on the basis ofmaintaining the stability of the original leasing business, the company actively promotes the improvement ofproperty quality and transform its old properties from the traditional method of simple leasing to the direction ofproperty asset operation, so as to fully enhance and tap the added value of the property brand, bring stable businessincome and cash flow to the company, and provide a solid foundation for the company's long-term development.
IV. Main business analysisOverviewSee the “I-Main businesses of the Company during the reporting period”Change of main financial data on a y-o-y basis
Unit: RMB/CNYCurrent period
year
y-o-y changes (+,-) ReasonsOperating revenue 250,015,152.23 249,492,261.24 0.21%
Same period of lastOperation costs
| Operation costs | 188,344,177.55 | 173,313,253.96 | 8.67% | |
| Sales expense | 10,947,318.15 | 12,002,312.02 | -8.79% | |
| Management expense | 19,832,917.21 | 20,807,474.69 | -4.68% |
Financial expense -2,701,556.39 -404,559.89 -567.78%
costs, there was an bond
| interest from equity |
| 11 |
performance occurred
in the same period ofprevious yearIncome tax expense 10,808,747.89 11,085,413.51 -2.50%
| performance occurred |
| Decrease in operation |
profit
Net cash flow arisingfrom operatingactivities
-11,318,295.41 59,571,399.02 -119.00%
tax increased on a y-o-y
| basis; 3. purchase payment from gold |
supply chain increasedon a y-o-y basis
from investmentactivities
-29,463,885.19 69,492,791.58 -142.40%
| Net cash flow arising | Investment in Tellus Jinzuan Trading |
Building
from financingactivities
18,016,923.17 20,549,625.24 -12.32%
Loans of Tellus JinzuanTrading BuildingNet increase of cashand cash equivalent
-22,764,976.83 149,597,036.39 -115.22%
| Net cash flow arising | ||
| Mainly due to the |
investment in TellusJinzuan TradingBuildingMajor changes on profit composition or profit resources in reporting period
□ Applicable √ Not applicable
No major changes on profit composition or profit resources occurred in reporting period
Constitution of operating revenue
Unit: RMB/CNYCurrent period Same period last yeary-o-y changes (+,-)
Amount
Amount
| Ratio in operation revenue | Ratio in operation revenue |
Total operationrevenue
250,015,152.23 100% 249,492,261.24 100% 0.21%According to industries
| Auto sales | 90,748,050.16 | 36.30% | 95,643,935.09 | 38.34% | -5.12% |
| Auto inspection |
and maintenanceand accessories
21,877,337.87 8.75%23,157,150.81 9.28%-5.53%Property rental and
| sales |
| service |
89,143,718.75 35.66%99,013,183.37 39.69%-9.97%
48,246,045.45 19.30% 31,677,991.97 12.70% 52.30%According to products
Jewelry wholesaleand retailsAuto sales
| Auto sales | 90,748,050.16 | 36.30% | 95,643,935.09 | 38.34% | -5.12% |
| Auto inspection | 21,877,337.87 | 8.75% | 23,157,150.81 | 9.28% | -5.53% |
| 12 |
and maintenance
and accessories
| sales |
| Property rental and service |
89,143,718.75 35.66%99,013,183.37 39.69%-9.97%
48,246,045.45 19.30% 31,677,991.97 12.70% 52.30%According to region
Jewelry wholesaleand retailsShenzhen
| Shenzhen | 250,015,152.23 | 100.00% | 249,492,261.24 | 100.00% | 0.21% |
The industries, products or regions accounting for over 10% of the Company’s operating revenue or operatingprofit
√Applicable □ Not applicable
Unit: RMB/CNYOperating revenue Operating cost
Grossprofitratio
Increase/decrease of operatingrevenue y-o-y
Increase/decrease of operating
cost y-o-y
se of grossprofit ratio y-o-
yAccording to industries
Increase/decreaAuto sales
| Auto sales | 90,748,050.16 | 89,009,452.61 | 1.92% | -5.12% | -5.56% | 0.46% |
| Auto inspection |
andmaintenanceand accessoriessales
21,877,337.87 17,913,429.37 18.12% -5.53% 5.79% -8.76%
and service
89,143,718.75 29,683,060.13 66.70% -9.97% -0.84% -3.06%
| Property rental |
| Jewelry |
wholesale andretails
48,246,045.45 51,738,235.44 -7.24% 52.30% 60.71% -5.61%According to products
| Auto sales | 90,748,050.16 | 89,009,452.61 | 1.92% | -5.12% | -5.56% | 0.46% |
| Auto inspection |
andmaintenanceand accessoriessales
21,877,337.87 17,913,429.37 18.12% -5.53% 5.79% -8.76%
and service
89,143,718.75 29,683,060.13 66.70% -9.97% -0.84% -3.06%
| Property rental |
| Jewelry |
wholesale andretails
48,246,045.45 51,738,235.44 -7.24% 52.30% 60.71% -5.61%According to region
| Shenzhen | 250,015,152.23 | 188,344,177.55 | 24.67% | 0.21% | 8.67% | -5.87% |
| 13 |
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main business based onlatest one year’s scope of period-end
□ Applicable √ Not applicable
Reasons for y-o-y relevant data with over 30% changes
□ Applicable √ Not applicable
IV. Analysis of non-main business
√Applicable □ Not applicable
Unit: RMB/CNYAmount Ratio in total profit Note
(Y/N)Investment income 23,487,946.52 43.57%
| Whether be sustainable | |
| Investment income from shareholding enterprises and |
financing income
Y
Gain/loss of fair valuechanges
-617,068.50 -1.14%
2021
Y
Non-operation revenue 295,807.48 0.55%
| Redeem the unmatured wealth management income at the end of |
| The leasing deposit |
transferred to non-operating income uponearly surrender of leaseby the tenant
N
expenditure
237.72
| Non-operation | Disposal of the fixed |
assets
N
V. Analysis of assets and liability
1. Major changes of assets composition
Unit: RMB/CNY
| Current Period-end | Year-end of last year | Ratio |
changes
(+,-)
majorchangesAmount
Notes of
Ratio in total
assets
Amount
| Ratio in total | Ratio in total |
assets
| Monetary fund | 219,732,744.23 | 11.55% | 240,582,057.16 | 12.94% | -1.39% | |
| Account |
receivable
55,148,362.83 2.90% 18,094,059.92 0.97% 1.93%
| Contract assets | 0.00 |
Inventory 27,425,910.86 1.44% 25,434,925.04 1.37% 0.07%
estate
541,520,365.78 28.47% 551,383,294.54 29.65% -1.18%
| 14 |
Long-term
equityinvestment
81,238,655.05 4.27% 88,310,867.47 4.75% -0.48%
| Long-term | ||||||
| Fix assets | 112,837,946.28 | 5.93% | 109,438,198.23 | 5.88% | 0.05% | |
| Construction in |
process
261,124,333.54 13.73% 210,197,546.72 11.30% 2.43%
assets
6,513,372.33 0.34% 7,336,915.83 0.39% -0.05%
| Right-of-use |
| Short-term |
loans
0.00Contractliability
10,168,590.39 0.53% 21,059,311.18 1.13% -0.60%
loans
121,670,407.44 6.40% 86,875,874.39 4.67% 1.73%
| Long-term | ||||||
| Lease liability | 3,963,266.13 | 0.21% | 4,474,543.09 | 0.24% | -0.03% | |
| Trading |
financial assets
422,095,775.34 22.19% 412,712,843.84 22.19% 0.00%
payable
115,063,036.77 6.05% 112,617,963.65 6.06% -0.01%
2. Main foreign assets
□Applicable √Not applicable
3. Assets and liability measured by fair value
√ Applicable □Not applicable
Unit: RMB/CNYItems
Openingamount
Other account
Changes of
fair valuegains/losses
in this
| period | Accumulati |
ve changesof fair value
reckoned
Impairment accrual
in thePeriod
Amount ofpurchase inthe period
Amount ofsale in the
period
Otherchange
s
EndingamountFinancialassets
1.Trading
financialassets(excludingderivativefinancialassets)
412,712,84
3.84
-617,068.50
692,000,000.0
682,000,000
.00
422,095,77
5.34
2. Other
equityinstrumentsInvestment
10,176,617.
10,176,617.
Above total
into equity422,889,46
1.04
-617,068.50
| 422,889,461.04 | 692,000,000.00 | 682,000,000.00 |
| 15 |
Financialliabilities
0.00 0.00Whether there have major changes on measurement attributes for main assets of the Company in report period or not
□ Yes √No
4. Right of the assets restrained till end of the Period
As of 30 June 2022,the Company’s right to use of monetary funds under restrictions is 27,188,802.59 Yuan, which is the supervisionfund paid by the Company to Luohu District Urban Renewal Bureau of Shenzhen for the land plot 03 project of the upgrading projectof Tellus-Gman Gold Jewelry Industrial Park. The monetary funds with restricted use rights at the end of last year were 26,926,471.3Yuan.VI. Investment analysis
1. Overall situation
√Applicable □Not applicable
Investment amount in the period (Yuan)
Changes (+,-)
| Investment amount at same period of last year (Yuan) | ||
| 50,926,786.82 | 34,159,982.94 | 49.08% |
2. The major equity investment obtained in the reporting period
□Applicable √ Not applicable
3. The major on-going non-equity investment in the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
□ Applicable √ Not applicable
The Company has no securities investment during the reporting period
(2) Derivative investment
□ Applicable √ Not applicable
The Company has no derivative investment during the reporting period5.Application of raised proceeds
□ Applicable √ Not applicable
The Company has no application of raised proceeds during the reporting period
| 16 |
VII. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company had no major assets were sold during the reporting period
2. Sales of major equity
□ Applicable √ Not applicable
VIII. Analysis of main holding Company and stock-jointly companies
√ Applicable □ Not applicable
Main subsidiary and participating companies with an impact of 10% or more on the Company’s net profit
Unit: RMB/CNY
name
Type
| Company | Main |
business
capital
Total assets Net assets
| Register | Operating |
revenue
Operating profit Net profit
AutoIndustry andTradeCorporation
Subsidiary
Sales ofauto andaccessories
RMB
58.96
million
465,053,209.6
416,366,405
.43
15,707,64
0.85
19,441,350.65 16,777,366.31
ShenzhenSDG HuariAutoEnterpriseCo., Ltd.
Subsidiary
| Shenzhen | ||
| Auto |
maintenanceandproductionand sales ofaccessories
USD 5million
78,933,844.98
33,840,302.
18,688,99
2.55
2,577,906.29 179,232.25
ZhongtianIndustrialCo,. Ltd.
Subsidiary
Propertyrental
RMB
366.2219
million
602,461,949.9
476,881,625
.27
49,206,71
8.02
27,672,928.10 20,579,654.24
| Shenzhen |
| Shenzhen |
HuariToyotaAutomobileSales Co.Ltd
Subsidiary
Auto sales
RMB 2million
80,858,425.20
10,077,189.
112,831,2
30.57
-1,082,890.12 -1,107,237.10
XinyongtongAutomobileTesting
Subsidiary
| Shenzhen | Manufactur |
e ofinspectionequipmentfor motor
RMB
19.61
million
18,230,660.84
476,881,625
.27
1,978,661.
246,142.59 425,092.64
| 17 |
Equipment
Co., Ltd.
| Equipment | vehicle | |
| Shenzhen |
TellusXinyongtongAutomobileDevelopment Co., Ltd.
Subsidiary
Inspectionand repairof motorvehicle
RMB
32.90
million
465,053,209.6
416,366,405
.43
3,804,172.
1,770,815.60 1,328,111.70
TellusChuangyingTechnologyCo., Ltd.
Subsidiary
Propertyrental
RMB 14million
19,641,733.15
16,276,419.
1,946,741.
691,689.07 943,286.42
ShenzhenTellusTreasurySupplyChain Tech.Co., Ltd.
Subsidiary
| Shenzhen | ||
| Purchase, |
sales andleasing ofgold jewelryand preciousmetalproducts,coffer leaseandwarehousing services
RMB 50million
51,319,457.05
21,716,113.
44,362,81
8.87
-585,503.44 -585,503.44
ShenzhenJewelryIndustryService Co.,LTD
Subsidiary
fairplanning,jewellery onconsignment, exhibitionplanning,conferenceservices andmarketingplanning
RMB 100million
51,319,457.05
21,716,113.
3,883,226.
-3,096,012.15 -3,096,012.15
| Jewellery | ||
| Shenzhen |
Zung FuTellus AutoService Co.,Ltd.
JointstockCompany
Car salesandmaintenance
RMB 30million
213,898,319.5
74,875,538.
493,226,6
17.42
-4,851,019.23 -3,318,473.42
TellusGman
| Shenzhen | Joint |
stockCompan
in industry,property
| Investment | RMB |
123.70496
million
387,370,319.7
81,703,870.
51,327,65
8.48
20,859,078.84 17,478,284.13
| 18 |
Investment
Co., Ltd.
| Investment | y | managemen |
t and leasing
Particular about subsidiaries obtained or disposed in report period
√ Applicable □ Not applicable
Name
Period
| Way to obtained and dispose in the | Impact on overall operation and |
performanceGuorun Gold (Shenzhen) Co., Ltd. Newly established
28, and has no impact on results of theperformance during the reporting periodIX Structured vehicle controlled by the Company
□ Applicable √ Not applicable
X. Risks of the Company and countermeasures
1. Risk from market volatility
Affected by international situation, epidemic in and out of China and other factors, domestic economic growth isslowing down, the pressure of industrial restructure is increasing; outbreaks of COVID-19 recurs from time to time,causing a significant impact on the economic development, the overall economic environment brings uncertainimpact on the Company’s operation.
Countermeasures: in response to this risk, the company will actively take various preventive measures. Firstly,reinventing the main line of management, improve efficiency through scientific management, tap the potential toincrease revenue, and comprehensively improve the profitability of the original business; secondly, firmly promotethe pace of strategic transformation, driving the transformation through innovative business models; exploit theincremental markets, expanding business scale and finding new profit growth points, and continuously enhance themarket influence of the Company, providing a favorable foundation for the long-term stable development of theCompany.
2. Risks of transformation restricted by talent shortage
During the period of enterprise transformation and development, with the rapid expansion of new business scale,enterprises have an increasing demand for all kinds of talents, whether technical or management talents. However,the existing talent team is gradually unable to meet the requirements of development.
Countermeasures: formulate “top-down” talent training goals, and establish “bottom-up” talent training plans.Formulate talent training and introduction plans combine with the third-party strategy of jewelry and the talenttraining cycle, so that the talent training plan and the enterprise development strategy are “in harmony”. Establishunselfish, diligent and truth-seeking work style, improve cohesion and execution, and ensure the stability ofenterprise transformation.
| 19 |
Section IV Corporate GovernanceI. AGM(Annual General Meeting) and extraordinary general meeting
1. AGM held in the period
Session of meeting Type
participation
Meeting Date Date of disclosure Resolutions
Annual GeneralMeeting of 2021
AGM 60.77% 2022-04-29 2022-04-30
| Ratio of investor | ||
| Found more in Resolution of the Annual General Meeting of 2021 |
(Notice No.: 2022-
Securities Times,
| Hong Kong |
Commercial Daily
Website(www.cninfo.com.cn)
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□Applicable √Not applicable
II. Changes of directors, supervisors and senior executives
√Applicable □Not applicable
Name Working status Type Date Causes
and JuchaoYang
Hongyu
Director Leaving office 2022-03-29
| Yang | Resigned as a Director of the Company for |
work reasonsYang Xi Director Elected 2022-04-29
the Company at the second formal meeting
of 10
thBOD and AGM of 2021Gu Zhiming Director Leaving office 2022-05-20
| Elected as the Director of the 10th BOD of |
| Resigned as a Director of the Company for |
work reasonsIII. Profit distribution plan and capitalizing of common reserves in the period
□ Applicable √ Not applicable
The Company plans not to distributed cash dividends and there are no bonus shares and capitalizing of commonreserves either for the first half of the year.
| 20 |
IV. Implementation of the Company’s stock incentive plan, employee stock ownership plan orother employee incentives
□Applicable √ Not applicable
During the reporting period, the Company has no stock incentive plan, employee stock ownership plan or otheremployee incentives that have not been implemented.
| 21 |
Section V Environmental and Social ResponsibilityI. Major environmental protectionListed Company and its subsidiary belong to the key pollution enterprise listed by Department of EnvironmentalProtection
□Yes √No
Measures taken to reduce the carbon emission during the reporting period and their effectiveness
□Applicable √ Not applicable
II. Social responsibilityThe Company has always been committed to repaying shareholders, achieving employees’ value, and contributingto the society. Based on the principle of fairness, the company actively safeguarded the legitimate rights and interestsof shareholders; advocated realizing self-worth while realizing corporate value, created an enterprise atmosphere inwhich the company cares for employees, employees love the company, and develop harmoniously together; activelyrepaid the society and the public, and fulfilled the responsibility of a state-owned enterprise, donated livingmaterials to the community, implementing the rental reduction and relief policies of the Shenzhen MunicipalGovernment and the Municipal SASAC to help the tenants cross difficult times; meanwhile, during the tough timeof the epidemic in Shenzhen, three employees were sent to participate in the anti-epidemic works on a full-timebasis, organize volunteers from the Company to participate in many community works of epidemic prevention andcontrol.
| 22 |
Section VI Important EventI. Commitments that the actual controller, shareholders, related party, buyers and the Company havefulfilled during the reporting period and those that have been overdue as of the end of the reporting period
√Applicable □Not applicable
Commitments
Commitment party
ofcommitments
Content of commitments
Commitmentdate
Commitment
term
Implementat
ion
Commitments make ininitial publicoffering orre-financing
ShenzhenTellusHoldingCo., Ltd.
Other
| Type | |
| The commitments to the fulfillment of information disclosure |
about the Company business development are as follows: exceptfor the information has been disclosed publicly, the Company hasnot had the disclosed information about asset acquisition andbusiness development that has not been disclosed within one year.In the future, the Company shall timely, accurately and adequatelydisclose the relevant information according to the progress of newbusiness and the related requirements.
2014-10-17
Long-term
Implementing
Othercommitments formedium andsmallshareholders
ShenzhenSpecialDevelopment GroupCo., Ltd.
HorizontalCompetition
controlling shareholder, Shenzhen Special Development GroupCo., Ltd. has issued the “commitment letter about the avoidanceof horizontal competition” on May 26, 2014. The full commitment
| letter is as follows: 1. The Company and other enterprises |
controlled by the Company except Tellus Group haven’t occupiedin any business that could substantially compete with the mainbusinesses of Tellus Group, and have no horizontal competitionrelationship with Tellus Group.
2014-05-26
Long-term
Implementing
Othercommitments formedium andsmallshareholders
ShenzhenTellusHoldingCo., Ltd.
Dividendcommitment
cover the losses of previous years; after making up for losses ofprevious years, in the premise that the Company’s profits and cashflow can meet the Company's normal operations and long-termdevelopment, reward shareholders, the Company will implementpositive profit distribution approaches to reward the shareholders,details are as follows: 1. The Company’s profit distribution canadopt cash, stock or the combination of cash and stock or othermethods permitted by law. The foreign currency conversion rates
| of domestically listed foreign shares dividend are calculated according to the standard price of HK dollar against RMB |
announced by People's Bank of China on the first working dayafter the
Company prefers to adopt the cash dividends to distribute profits.In order to maintain the adaptability between capital expansion
2021-04-24
2022-12-31
Implementing
| 23 |
and performance growth, in the premise of ensuring the full cash
dividend d
| istributions and the rationality of equity scale and equity structure, the Company can adopt the stock dividend |
methods to distribute profits. 2. According to the "Company Law"and other relevant laws and the provisions of the Company’s"Articles of Association", following conditions should be satisfied
Company's annual distributable profits (i.e. the after-tax profitsafter making up for losses and withdrawing accumulation funds)are positive value, the implementation of cash dividends will notaffect the Company's subsequent continuing operations; (2) theaudit institution issues the standard audit report with clean opinionto the Company's annual financial report; (3) the Company has nosignificant investment plans or significant cash outlay (except forfund-raising projects). Major investment plans or significant cashoutlay refer to: the accumulated expenditures the Company plansto used for investments abroad, acquisition of assets, or purchaseof equipment within the next 12 months reach or exceed 30% ofthe net assets audited in the latest period. 3. In the premise of
| meeting the conditions of cash dividends and ensuring the |
Company’s normal operation and long-term development, theCompany makes cash dividends once a year in principle, theCompany’s board of directors can propose the Company to make
profitability and capital demand conditions. The proportion ofcash dividends in profits available
| for distribution and in |
distribution of profits should meet the following requirements: (1)in principle, the Company’s profits distributed in cash every yearshould not be less than 10% of profit available for distributionrealized in the same year, and the Company’
accumulatively distributed in cash in the last three years shouldnot be less than 30% of the annual average profit available fordistribution realized in the last three years. (2) if the Company’sdevelopment stage belongs to mature s
| tage and there is no significant capital expenditure arrangement, when distributing |
profits, the minimum proportion of cash dividends in this profitdistribution should be 80%; (3) if the Company’s developmentstage belongs to mature stage and there are significant capital
minimum proportion of cash dividends in this profit distributionshould be 40%; (4) if the Company’s development stage belongsto growth stage and there are significant capital expenditurearrangements, when distributing profits, the minimum proportionof cash dividends in this profit distribution should be 20%; when
| 24 |
the Company's development stage is not easy to be differed but
there are significant capital expenditure arrangements, pleasehandle according to the preceding provisions. 4. On the condition
| of meeting the cash dividend distribution, if the Company's |
operation revenue and net profit grow fast, and the board ofdirectors considers that the Company’s equity scale and equitystructure are reasonable, the Company can propose and implementthe dividend distribution plans except proposing the cash dividenddistribution plans. When allocating stock dividend every time, thestock dividend per 10 shares should be no less than 1 share. Stockallocation can be implemented individually or in combination of
distribution by stock, the Company should fully consider if thegeneral capital after profit distribution by stock matches with theCompany’s current operation scale and profit growth rate andconsider the impact on future financing so as to make sure theallocation plans meet the overall interests of all shareholders.Completed
| cash dividends. When confirming the exact amount of profit | ||
| on time |
(Y/N)
Y
commitment
| out of the |
commitmenttime,
specific
| reasons and |
further plans
Not applicable
II. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.III. Guarantee outside against the regulation
□Applicable √Not applicable
No guarantee outside against the regulation in Period.
IV. Appointment and non-reappointment (dismissal) of CPAWhether the semi-annual financial report had been audited
| 25 |
□Yes √ No
The semi-annual report was not auditedV. Explanation on “Qualified Opinion” from CPA by the Board and Supervisory Committee
□Applicable √Not applicable
VI. Explanation from the Board for “Qualified Opinion” of last year’s
□Applicable √Not applicable
VII. Bankruptcy reorganization
□Applicable √Not applicable
No bankruptcy reorganization in Period.
VIII. LawsuitsMaterial lawsuits and arbitration
□Applicable √Not applicable
There were no material lawsuits and arbitration during the reporting period
Other lawsuits
√ Applicable □ Not applicable
The basicsituation oflitigation(Arbitration)
of moneyinvolved(in 10thousandYuan)
Predictedliabilities (Y/N)
| Amount | Advanc |
es inlitigation(Arbitration)
The results and effects oflitigation (Arbitration)
Execution of the
litigation(Arbitration)
Disclosuredate
Disclosure
index
Disputesoverguaranteerights ofrecovery(Jintian)
32.5 N
Enforcementstage
pay the company 325,000yuan in cash and 427,604A-shares and 163,886 B-shares of Jintian Company
| within five days after the judgment takes effect (If the stock cannot be delivered, it can be paid |
after being conv
price on the last day of the
| performance period). | 400,800 yuan has been paid back (including 325,000 yuan in cash as determined in the |
judgment and a total
cash such as B-shares
| converted to cash, preservation fees, |
delayed performance
427,604 A-shares
2022-04-08
The “AnnualReport of2021”released onJuchaoWebsite(www.cninfo.com.cn)
| 26 |
Jintian Company failed toperform its obligations
determined in the judgmentin a timely manner, and the
| company filed an |
application for compulsoryexecution with the court.
transfer the aforesaid
| funds and stocks to |
the Company.
theshareholderqualificationconfirmation(JapanChukyo AutoCorp(日本國中京自動車株式會社),ACUEnterpriseInc.(ACU企業株式會社)filed alawsuit incourt toconfirm theirshareholderstatus inSDG Huari)
19.84 N
Secondstage oftrial
The company has receivedthe first-instance judgment
| Dispute over | on June 30, 2022. The judgment confirmed that the plaintiffs, Chukyo Company and ACU Company, are the shareholders of the |
defendant, SDG Huari. The
99,200 yuan shall be borneby t
| he defendant, SDG Huari. Now, SDG Huari |
has appealed and paid the
scheduled for hearing.
No implementationinvolved at this time
2022-07-02
| legal fees, and is waiting for the second trial to be | The “Notice |
on Receipt ofthe CivilJudgment ofthe firstInstance bythe Companyand itscontrollingsubsidiary”(Notice No.:
2022-035)released onSecuritiesTimes, HongKongCommercialDaily andJuchaoWebsite(www.cninfo.com.cn)
Housinglease contractdispute (MaoZhexiang)
30.54 N
Enforcementstage
the Supplementary ChangeAgreement on Issues suchas Rent Collection of Street
| Stores on Tellus North Road between Mao |
Zhexiang and the companyare termina
Zhexiang should vacate thestreet stores involved in the
| ted from January 31, 2020; Mao | As of June 2022, the company has recovered all the properties involved in the case, and received the |
execution payment of283,383.45 yuan, and
about 22,000 yuan) is
| being executed. On |
| 27 |
case and hand over to thecompany, and pay Tellus
Holding the possession anduse fee by 12,498 yuan permonth from May 1, 2020 tothe date of the actual returnof the street shop involvedin the case. Mao Zhexiangdid not take the initiative to
| perform his obligations, |
and Tellus Holding appliedfor compulsory execution.
Luohu Court issued ahigh consumption
| restriction order to |
Mao Zhexiang.
ContractDispute(ShenzhenLvchengEco-DevelopmentCo., Ltd,ShenzhenYinglongJian’an(Group) Co.,Ltd.)
51.59 N
Secondstage oftrial
The Company received the
| Construction | first trial decision on |
December 17, 2021, whichruled that the Company and
503,000 yuan principal and
| interest to Lvcheng Company together. Now |
the Company has appealedand awaits the second trialhearing and verdict
No implementationinvolved at this time
Dispute onSalesContract ofCommercialProperty (LiuDan,ShenzhenSDG TellusReal EstateCo., Ltd.)
0.02 N
Judgmentsatisfactionstage
defendant, Shenzhen SDGTellus Real Estate Co., Ltd,should survey and draw the
| house property at Room 502, Building 4, Tellus Garden purchased by Liu |
Dan, the plaintiff, withinone month after judgmentcame into effect, the sheet
Room No.529 of the house.The case acceptance fee of200 yuan shall be borne bythe defendant, Shenzhen
Has cooperated withthe plaintiff to stampon licensingdocuments
| 28 |
SDG Tellus Real Estate
Co., Ltd
| . Because the |
implementation of the caseis clear, the company does
correspondingresponsibility, it plans to nolonger appeal. In June, the
| company has cooperated |
with the plaintiff to stamp
applying for a certificate.IX. Penalty and rectification
□ Applicable √Not applicable
X. Integrity of the Company and its controlling shareholders and actual controllers
□ Applicable √Not applicable
XI. Major related transaction
1. Related transaction with routine operation concerned
√ Applicable □ Not applicable
Relate
dparty
Relationshi
p
Type
ofrelate
dtransaction
Content ofrelate
dtransaction
Pricin
gprinci
ple
Relatedtransactionprice
on the documents for
Relate
dtransactionamount (in
thousa
ndYuan)
Proportion
insimila
rtransactions
(%)
Tradi
nglimitappro
ved(in 10thousa
ndYuan)
| Relate | Whet |
herovertheappro
vedlimite
d or
not(Y/N)
Cleari
ngform
forrelate
dtransaction
Availa
blesimila
rmarket price
Date
ofdisclo
sure
Index
ofdisclo
sure
henZungFuTellusAutoService Co.,Ltd.
| Shenz | Direct |
or/Supervisor/ SEservesdirector oftheComp
Routinerelatedtransactions
Providingpropertyleasing
Referencetomarket price
259.5
259.5
2.61% 545 N
mentaccordingtocontract oragreement
259.5
| 29 |
any
| any | |
| Shenz |
henSDGTellusPropertyManagementCo.,Ltd.
Subsidiaryof thecontrollingshareholder
Routinerelatedtransactions
Providingpropertyleasing
Referencetomarket price
1.52 1.52 0.02% 14 N
Settlementaccordingtocontract oragreement
1.52
ShenzhenSDGPettyLoanCo.,Ltd.
Subsidiaryof thecontrollingshareholder
Routinerelatedtransactions
dingpropertyleasing andmanagementservice
Referencetomarket price
65.41 65.41 0.66% 140 N
Settlementaccordingtocontract oragreement
65.41
| Provi | ||
| Jewelr |
y ParkBranch ofShenzhenSDGService Co.,Ltd.
Sub-subsidiaryofcontrollingshareholder
Routinerelatedtransactions
Providingpropertyleasing
Referencetomarket price
110.8
110.8
1.11% 180 N
Settlementaccordingtocontract oragreement
110.8
Jewelry ParkBranch ofShenzhenSDGService Co.,Ltd.
Sub-subsidiaryofcontrollingshareholder
Routinerelatedtransactions
veservice ofcleaningandgreeningandrenov
Referencetomarket price
523.6
523.6
47.83
%
36 N
Settlementaccordingtocontract oragreement
523.6
| 30 |
ation
| ation | ||
| Shenz |
henSDGTellusPropertyManagementCo.,Ltd.
Subsidiaryof thecontrollingshareholder
Routinerelatedtransactions
Acceptingpropertymanagementservice
Referencetomarket price
152.9
152.9
0.81% 1,570 N
Settlementaccordingtocontract oragreement
152.9
Total -- --
--2,485-- -- -- -- --
| 1,113. | ||
| Detail of sales return with major |
amount involved
N/A
of the normal related transactions
| which were projected about their |
total amount by types during thereporting period (if applicable)
Performing normally
between trading price and marketreference price (if applicable)
Not applicable
2. Related transactions by assets acquisition and sold
□ Applicable √ Not applicable
No related transactions by assets acquisition and sold for the Company in reporting period
3. Main related transactions of mutual investment outside
□ Applicable √ Not applicable
No main related transactions of mutual investment outside for the Company in reporting period
4. Contact of related credit and debt
□ Applicable √ Not applicable
Whether has non-operational contact of credit and debts or not
□Yes √No
There was no non-operational contact of credit and debts during the reporting period
| 31 |
5. Contact with the related finance companies
□ Applicable √ Not applicable
There are no deposits, loans, credits or other financial business between the Company and the finance companieswith related relationships or between the related parties
6. Contact with the finance companies controlled by the Company and related parties
□ Applicable √ Not applicable
There are no deposits, loans, credits or other financial business between the finance companies controlled by theCompany and related parties
7. Other related transactions
□Applicable √Not applicable
No other related transaction in PeriodXII. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
No trusteeship for the Company in reporting period
(2) Contract
□ Applicable √ Not applicable
No contract for the Company in reporting period
(3) Leasing
□ Applicable √ Not applicable
No leasing for the Company in reporting period
2. Major guarantees
√ Applicable □ Not applicable
In 10 thousand Yuan
Particulars about the external guarantee of the Company and its subsidiary (Barring the guarantee for subsidiaries)
| Name of | Related | Guarante | Actual | Actual | Guarante | Collatera | Counter | Guarante | Impleme | Guarante |
| 32 |
the
Companyguarante
ed
| the | Announc |
ementdisclosur
e date
| e limit | date of |
happenin
g
e limit
| guarante | e type | l (if any) | guarante |
e (if any)
| e term | nted |
(Y/N)
relatedparty(Y/N)
| e for | ||
| Shenzhe |
n ZungFuTellusAutoServiceCo., Ltd.
2014-09-
3,500
2007-04-
3,500 Pledge
To theexpiredate ofjointventurecontract
N Y
external guarantee inreport period (A1)
| Total approving | Total actual occurred |
external guarantee inreport period (A2)
3,500
external guarantee atthe end of reportperiod (A3)
3,500
| Total approved | Total actual balance |
of external guaranteeat the end of reportperiod (A4)
3,500Guarantee of the Company to subsidiaries
theCompan
yguarante
ed
RelatedAnnounc
ementdisclosur
e date
Guarante
e limit
Actualdate ofhappenin
g
Actualguarante
e limit
Guarante
e type
Collateral (if any)
Counterguarantee (if any)
Guarante
e term
Impleme
nted(Y/N)
Guarante
e forrelated
party
(Y/N)Guarantee of the subsidiaries to subsidiaries
Name ofName of
theCompanyguarante
ed
RelatedAnnounc
ementdisclosur
e date
Guarante
e limit
Actualdate ofhappenin
g
Actualguarante
e limit
Guarante
e type
Collateral (if any)
Counterguarantee (if any)
Guarante
e term
Impleme
nted(Y/N)
Guarante
e forrelated
party
(Y/N)Total amount of guarantee of the Company (total of three above mentioned guarantee)
Name ofTotal amount of
approving guaranteein report period(A1+B1+C1)
| Total amount of | Total amount of |
actual occurredguarantee in reportperiod (A2+B2+C2)
3,500
approved guaranteeat the end of reportperiod (A3+B3+C3)
3,500
| Total amount of | Total balance of |
actual guarantee atthe end of reportperiod (A4+B4+C4)
3,500The proportion of the total amount of
2.39%
| 33 |
actually guarantee in the net assets of the
Company (that is A4+ B4+C4)Including:
3. Trust financing
√ Applicable □ Not applicable
In 10 thousand Yuan
Type Capital resources Amount for entrust
Outstandingbalance
Amount overdue
for collection
actually guarantee in the net assets of theImpairment for the
overdue financial
| management | ||
| Bank financing product |
Own funds70,000 42,100 0 0Total 70,000 42,100 0 0Details of the single major amount, or high-risk trust investment with low security, poor fluidity and non-guaranteed
□Applicable √Not applicable
Entrust financial expected to be unable to recover the principal or impairment might be occurred
□Applicable √Not applicable
4. Other material contracts
□ Applicable √ Not applicable
No other material contracts for the Company in reporting period.XIII. Description of other significant matters
√ Applicable □ Not applicable
Resolved by the 4
th interim Meeting of 10
thBOD, the Company cooperated with Shenzhen HTI, Chow Tai FookJewelry Culture Industrial Park (Wuhan) Co., Ltd to jointly invest in the establishment of an enterprise of a goldflow platform, the project has 200 million yuan in total for the investment. Found more on the “Notice on Investmentof a Gold Flow Platform” (Notice No.: 2022-027) released on Securities Times, Hong Kong Commercial Daily andJuchao Website (www.cninfo.com.cn) dated June 15, 2022. The gold flow platform company has been registeredpresently and will carry out business gradually.XIV. Important event of the subsidiaries
√ Applicable □ Not applicable
Due to the expiry of business term under the name of controlling subsidiary - Shenzhen SDG Huari Auto EnterpriseCo., Ltd, the Company is advancing the follow-up matters of the expiration of business term of SDG Huari in linewith the laws and regulations. The business premises of Shenzhen Huari Toyota Auto Sales Service Co., Ltd-controlling subsidiary of the Company is the property owned by SDG Huari, due to the risks of liquidation of SDGHuari, the Company is in-depth studying the future director of Huari Toyota. In addition, SDG Huari appealedagainst the first instance judgment in the dispute over the confirmation of shareholder qualification, and SDG Huari
| 34 |
has filed an appeal in accordance with the law. Found more in the “Informative Notice on Expiration of the BusinessTerm of Controlling Subsidiary” (Notice No.: 2022-030), “Notice on Response to the Concern Letter of ShenzhenStock Exchange” (Notice No.: 2022-032), “Receipt of the Civil Judgment of the First Instance by the Company andits Controlling Subsidiary” (Notice No.: 2022-035), “Notice on Expiration of the Business Term of ControllingSubsidiary” (Notice No.: 2022-038) and “Progress of Litigation of the Controlling Subsidiary” (Notice No.: 2022-039) released on Securities Times, Hong Kong Commercial Daily and Juchao Website (www.cninfo.com.cn) datedJune 22, 2022, June 29, July 2, and July 29 respectively. In view of the fact that SDG Huari is still involved inlitigation, and the related matters with SDG Huari concerned are uncertain in the short term, the Company will,through all legal means to protect the interest of majority investors, claim the rights and interest of the Company,and will pay close attention to the subsequent progress of the matters and timely compliance with the informationdisclosure obligations.
| 35 |
Section VII. Changes in Shares and Particulars about Shareholder
I. Changes in Share Capital
1. Changes in Share Capital
Unit: share
| Before change | Increase/decrease in this time (+ , - ) | After change |
Amount Ratio
Newsharesissued
Bonusshare
tion ofpublic
| reserve |
Other Subtotal Amount Ratio
Restricted
| shares |
0 0.00% 0 0 0 0 0 0 0.00%
1. State
holding
0 0.00% 0 0 0 0 0 0 0.00%
ownedcorporatio
| n shares |
0 0.00% 0 0 0 0 0 0 0.00%
domestic
| shares |
0 0.00% 0 0 0 0 0 0 0.00%
domesticlegalperson’s
| shares |
0 0.00% 0 0 0 0 0 0 0.00%
Domesticnaturalperson’s
| shares |
0 0.00% 0 0 0 0 0 0 0.00%
4. Foreign
er’sshares
0 0.00% 0 0 0 0 0 0 0.00%
foreigncorporatio
| n shares |
0 0.00% 0 0 0 0 0 0 0.00%
Foreignnaturalperson’s
| shares |
0 0.00% 0 0 0 0 0 0 0.00%
restricted
| shares |
431,058,3
100.00% 0 0 0 0 0
431,058,3
100.00%
ordinary
| shares |
392,778,3
91.12% 0 0 0 0 0
392,778,3
91.12%
Domestically listedforeign
| shares |
38,280,00
8.88% 0 0 0 0 0
38,280,00
8.88%
2. Foreign
shares
0 0.00% 0 0 0 0 0 0 0.00%
| 36 |
aboard
3. Other
0 0.00% 0 0 0 0 0 0 0.00%III. Totalshares
aboard431,058,3
100.00% 0 0 0 0 0
| 431,058,320 | 431,058,320 |
100.00%
Reasons for share changed
□ Applicable √ Not applicable
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Progress of shares buy-back
□ Applicable √ Not applicable
Implementation progress of reducing holdings of shares buy-back by centralized bidding
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to commonshareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of lock-up stocks
□ Applicable √ Not applicable
II. Securities issuance and listing
□ Applicable √ Not applicable
III. Amount of shareholders of the Company and particulars about shares holding
Unit: shareTotal common stockshareholders in reportingperiod-end
73,270
rights recovered at end of reporting period (ifapplicable) （see note 8）
| Total preference shareholders with voting | ||
| Particulars about common shares held above 5% by shareholders or top ten common shareholders | ||
Full name
ofShareholders
Nature ofshareholder
Proportion
of shares
held
commonshares held atthe end ofreporting
period
Changes inreport period
| Amount of | Amount |
ofrestrictedcommon
shares
held
Amount of
commonshares held
without
restriction
shares pledged,tagged or frozenState of
share
Amount
Information ofShenzhen
SpecialDevelopment GroupCo., Ltd.
State-ownedcorporation
49.09% 211,591,621 0 0 211,591,621 0
| 37 |
Shenzhen
CapitalFortuneJewelryIndustryInvestmentEnterprise(LP)
Domesticnon state-ownedcorporate
10.89% 46,923,432 -8,621,005 0 46,923,432 0
LiXiaoming
| Shenzhen | |
| Domestic |
natureperson
0.60% 2,607,800 2,607,800 0 2,607,800 0
UNANSECURITIES(HONGKONG)LIMITED
Foreigncorporation
0.40% 1,744,491 -112,055 0 1,744,491 0
| GUOTAIJ |
| Industrial |
andCommercial Bank ofChina -ChinaSouthernCSI IndexReal EstateTradedOpen-endedIndex Fund
0.39% 1,663,775 1,663,775 0 1,663,775 0
SecuritiesCo., Ltd.
| Huatai | State- |
ownedcorporation
0.32% 1,382,458 1,382,458 0 1,382,458 0UBS AG
corporation
0.30% 1,309,975 1,309,975 0 1,309,975 0Li Hao
| Foreign |
| Domestic |
natureperson
0.30% 1,300,241 1,300,241 0 1,300,241 0Gao Bo
natureperson
0.23% 1,000,000 1,000,000 0 1,000,000 0Lin Haizhi
| Domestic |
| Domestic |
natureperson
0.19% 809,766 809,766 0 809,766 0
| 38 |
Strategy investor or
general legal personbecoming the top 10common shareholders byplacing new shares (ifapplicable) (see note 3)
N/A
Explanation on associated
| Strategy investor or |
| relationship among the |
aforesaid shareholders
person’s shareholders SDG, Ltd and other shareholders, and they do not belong to the persons acting
| in concert regulated by the Management Measure of Information Disclosure on Change of |
Shareholding for Listed Companies. For the other shareholders of circulation share, the Company isunknown whether they belong to the persons acting in concert.
shareholders in relation todelegate/entrusted votingrights and abstention fromvoting rights.
Not applicable
| Description of the above |
| Special note on the |
repurchase account amongthe top 10 shareholders (ifapplicable) (see note 11)
N/AParticular about top ten shareholders with un-lock up common stocks heldShareholders’ name
at Period-end
| Amount of common shares held without restriction | Type of shares | ||
| Type | Amount | ||
| Shenzhen Special | |||
Development Group Co.,Ltd.
211,591,621 RMB common shares 211,591,621
Jewelry IndustryInvestment Enterprise(LP)
46,923,432 RMB common shares 46,923,432
| Shenzhen Capital Fortune | |||
| Li Xiaoming | 2,607,800 | RMB common shares | 2,607,800 |
| GUOTAIJUNANSECURI |
TIES(HONGKONG)LIMITED
1,744,491
Domestically listedforeign shares
1,744,491
Commercial Bank ofChina -China SouthernCSI Index Real EstateTraded Open-ended IndexFund
1,663,775 RMB common shares 1,663,775
| Industrial and | |||
| Huatai Securities Co., Ltd. | 1,382,458 | RMB common shares | 1,382,458 |
| UBS AG | 1,309,975 | RMB common shares | 1,309,975 |
| Li Hao | 1,300,241 | RMB common shares | 1,300,241 |
| Gao Bo | 1,000,000 | RMB common shares | 1,000,000 |
| 39 |
Lin Haizhi
| Lin Haizhi | 809,766 | RMB common shares | 809,766 |
| Expiation on associated relationship or consistent actors within the top 10 |
un-
shareholders and betweentop 10 un-lock up common
| shareholders and top 10 |
common shareholders
Among the top ten shareholders, there exists no associated relationship between the state-owned legalperson’s shareholders SDG, Ltd and other shareholders, and they do not belong to the persons acting
Shareholding for Listed Companies. For the other shareholders of circulation share, the Company isunknown whether they belong to the persons acting in concert.
| in concert regulated by the Management Measure of Information Disclosure on Change of | |
| Explanation on top 10 common shareholders |
involving margin business(if applicable) (see note 4)
guarantee securities account, and 0 share of the company's stock through an ordinary securitiesaccount, for a total of 1,300,241 shares. The shareholder Lin Haizhi holds 809,766 shares of thecompany's stock through a credit transaction guarantee securities account, and 0 share of thecompany's stock through an ordinary securities account, for a total of 809,766 shares.Whether top ten common stock shareholders or top ten common stock shareholders with un-lock up shares held have a buy-backagreement dealing in reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-lock up shares held of the Company have nobuy-back agreement dealing in reporting period.
IV. Changes of shares held by directors, supervisors and senior executives
□ Applicable √ Not applicable
Shares held by directors, supervisors and senior executives have no changes in reporting period, found more details in Annual Report2021.V. Changes in controlling shareholders or actual controllers
Change of controlling shareholder during the reporting period
□ Applicable √ Not applicable
Change of actual controller during the reporting period
□ Applicable √ Not applicable
The Company had no change of actual controller during the reporting period
| 40 |
Section VIII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period
| 41 |
Section IX. Corporate Bonds
□ Applicable √ Not applicable
| 42 |
Section X. Financial Report
I. Financial StatementStatement in Financial Notes are carried in RMB/CNY
1. Consolidated Balance Sheet
Prepared by Shenzhen Tellus Holding Co., Ltd.
June 30, 2022
Unit: RMB/CNY
| Item | June 30, 2022 | December 31, 2022 |
| Current assets: |
| Monetary funds | 219,732,744.23 | 240,582,057.16 |
| Settlement provisions | ||
| Capital lent | ||
| Trading financial assets | 422,095,775.34 | 412,712,843.84 |
| Derivative financial assets |
| Note receivable |
| Account receivable | 55,148,362.83 | 18,094,059.92 |
| Receivable financing |
| Accounts paid in advance | 13,892,808.08 | 16,532,227.85 |
| Insurance receivable |
| Reinsurance receivables | ||
| Contract reserve of reinsurance |
receivable
| Other account receivable | 7,554,454.53 | 5,072,970.77 |
| Including: Interest receivable | ||
| Dividend receivable | 547,184.35 | 547,184.35 |
assets
| Buying back the sale of financial | ||
| Inventories | 27,425,910.86 | 25,434,925.04 |
| Contractual assets |
| Assets held for sale | 530,520.33 |
year
| Non-current asset due within one | ||
| Other current assets | 3,630,901.41 | 8,596,585.57 |
| Total current assets | 749,480,957.28 | 727,556,190.48 |
| Non-current assets: | ||
| Loans and payments on behalf |
| Debt investment |
| Other debt investment |
| 43 |
Long-term account receivable
| Long-term account receivable | ||
| Long-term equity investment | 81,238,655.05 | 88,310,867.47 |
instrument
10,176,617.20 10,176,617.20
| Investment in other equity | ||
| Other non-current financial assets |
| Investment real estate | 541,520,365.78 | 551,383,294.54 |
| Fixed assets | 112,837,946.28 | 109,438,198.23 |
| Construction in progress | 261,124,333.54 | 210,197,546.72 |
| Productive biological asset |
| Oil and gas asset |
| Right-of-use assets | 6,513,372.33 | 7,336,915.83 |
| Intangible assets | 48,966,336.58 | 49,589,498.28 |
| Expense on Research and |
Development
| Goodwill |
apportioned
26,848,710.98 28,682,636.66
| Long-term expenses to be | ||
| Deferred income tax asset | 8,499,551.03 | 8,499,551.03 |
| Other non-current asset | 54,605,044.16 | 68,473,888.99 |
| Total non-current asset | 1,152,330,932.93 | 1,132,089,014.95 |
| Total assets | 1,901,811,890.21 | 1,859,645,205.43 |
| Current liabilities: |
| Short-term loans | ||
| Loan from central bank | ||
| Capital borrowed |
| Trading financial liability |
| Derivative financial liability | ||
| Note payable | ||
| Account payable | 69,778,883.21 | 67,407,763.03 |
| Accounts received in advance | 10,861,839.87 | 1,827,827.28 |
| Contractual liability | 10,168,590.39 | 21,059,311.18 |
| Selling financial asset of repurchase | ||
| Absorbing deposit and interbank |
deposit
| Security trading of agency | ||
| Security sales of agency | ||
| Wage payable | 41,549,410.57 | 38,893,597.75 |
| Taxes payable | 21,055,313.44 | 48,522,100.45 |
| Other account payable | 115,063,036.77 | 112,617,963.65 |
| Including: Interest payable | ||
| Dividend payable |
commission payable
| Commission charge and | ||
| Reinsurance payable |
| 44 |
Liability held for sale
| Liability held for sale | ||
| Non-current liabilities due within |
one year
2,884,263.93 3,021,452.25
| Other current liabilities | 601,487.93 | 2,367,994.70 |
| Total current liabilities | 271,962,826.11 | 295,718,010.29 |
| Non-current liabilities: | ||
| Insurance contract reserve |
| Long-term loans | 121,670,407.44 | 86,875,874.39 |
| Bonds payable |
| Including: Preferred stock |
securities
| Perpetual capital | ||
| Lease liability | 3,963,266.13 | 4,474,543.09 |
| Long-term account payable | 3,920,160.36 | 3,920,160.36 |
| Long-term wages payable |
| Accrual liability | 268,414.80 | 268,414.80 |
| Deferred income | 9,558,134.67 | 10,235,331.21 |
| Deferred income tax liabilities | 963,045.49 | 963,045.49 |
| Other non-current liabilities | ||
| Total non-current liabilities | 140,343,428.89 | 106,737,369.34 |
| Total liabilities | 412,306,255.00 | 402,455,379.63 |
| Owner’s equity: |
| Share capital | 431,058,320.00 | 431,058,320.00 |
| Other equity instrument | ||
| Including: Preferred stock | ||
| Perpetual capital |
securities
| Capital public reserve | 431,449,554.51 | 431,449,554.51 |
| Less: Inventory shares |
| Other comprehensive income | 26,422.00 | 26,422.00 |
| Reasonable reserve |
| Surplus public reserve | 26,546,480.09 | 26,546,480.09 |
| Provision of general risk | ||
| Retained profit | 576,542,187.29 | 543,843,496.85 |
| Total owner’ s equity attributable to |
parent company
1,465,622,963.89 1,432,924,273.45
| Minority interests | 23,882,671.32 | 24,265,552.35 |
| Total owner’ s equity | 1,489,505,635.21 | 1,457,189,825.80 |
| Total liabilities and owner’ s equity | 1,901,811,890.21 | 1,859,645,205.43 |
Legal Representative: Fu ChunlongPerson in charge of Accounting Works: Lou Hong
| 45 |
Person in charge of Accounting Institution: Lou Hong
2. Balance Sheet of Parent Company
Unit: RMB/CNY
| Item | June 30, 2022 | December 31, 2022 |
| Current assets: |
| Monetary funds | 81,036,027.27 | 96,860,811.12 |
| Trading financial assets | 416,095,775.34 | 346,485,780.83 |
| Derivative financial assets |
| Note receivable | ||
| Account receivable | 2,715,392.30 | 119,014.41 |
| Receivable financing |
| Accounts paid in advance | 1,086,453.80 | 180,505.50 |
| Other account receivable | 2,263,037.37 | 90,401,592.58 |
| Including: Interest receivable |
| Dividend receivable | 547,184.35 | 547,184.35 |
| Inventories |
| Contractual assets |
| Assets held for sale | ||
| Non-current assets maturing within |
one year
| Other current assets | 137,126.11 | |
| Total current assets | 503,333,812.19 | 534,047,704.44 |
| Non-current assets: |
| Debt investment |
| Other debt investment | ||
| Long-term receivables |
| Long-term equity investments | 793,528,127.78 | 781,100,340.20 |
instrument
10,176,617.20 10,176,617.20
| Investment in other equity | ||
| Other non-current financial assets |
| Investment real estate | 28,170,379.26 | 29,425,213.32 |
| Fixed assets | 17,142,634.69 | 17,792,917.53 |
| Construction in progress | 260,999,489.22 | 210,072,702.40 |
| Productive biological assets |
| Oil and natural gas assets |
| Right-of-use assets |
| Intangible assets | 47,645,805.33 | 48,214,014.93 |
| Research and development costs | ||
| Goodwill |
| Long-term deferred expenses | 8,343,141.87 | 8,853,627.44 |
| Deferred income tax assets | 3,398,437.68 | 3,398,437.68 |
| Other non-current assets | 27,041,880.66 | 32,375,515.49 |
| 46 |
Total non-current assets
| Total non-current assets | 1,196,446,513.69 | 1,141,409,386.19 |
| Total assets | 1,699,780,325.88 | 1,675,457,090.63 |
| Current liabilities: |
| Short-term borrowings | ||
| Trading financial liability | ||
| Derivative financial liability |
| Notes payable |
| Account payable | 334,195.06 | 344,098.18 |
| Accounts received in advance | 1,929,742.08 | 60,656.39 |
| Contractual liability | ||
| Wage payable | 28,423,362.63 | 25,851,294.89 |
| Taxes payable | 2,759,307.61 | 1,873,430.60 |
| Other accounts payable | 462,130,705.37 | 471,549,476.87 |
| Including: Interest payable | ||
| Dividend payable |
| Liability held for sale |
one year
| Non-current liabilities due within | ||
| Other current liabilities | ||
| Total current liabilities | 495,577,312.75 | 499,678,956.93 |
| Non-current liabilities: | ||
| Long-term loans | 121,670,407.44 | 86,875,874.39 |
| Bonds payable |
| Including: Preferred stock |
securities
| Perpetual capital | ||
| Lease liability |
| Long-term account payable | ||
| Long term employee compensation |
payable
| Accrued liabilities |
| Deferred income | ||
| Deferred income tax liabilities | ||
| Other non-current liabilities | ||
| Total non-current liabilities | 121,670,407.44 | 86,875,874.39 |
| Total liabilities | 617,247,720.19 | 586,554,831.32 |
| Owners’ equity: | ||
| Share capital | 431,058,320.00 | 431,058,320.00 |
| Other equity instrument |
| Including: Preferred stock |
securities
| Perpetual capital | ||
| Capital public reserve | 428,256,131.23 | 428,256,131.23 |
| Less: Inventory shares |
| 47 |
Other comprehensive income
| Other comprehensive income | ||
| Special reserve |
| Surplus reserve | 26,546,480.09 | 26,546,480.09 |
| Retained profit | 196,671,674.37 | 203,041,327.99 |
| Total owner’s equity | 1,082,532,605.69 | 1,088,902,259.31 |
| Total liabilities and owner’s equity | 1,699,780,325.88 | 1,675,457,090.63 |
3. Consolidated Profit Statement
Unit: RMB/CNY
| Item | 2022 semi-annual | 2021 semi-annual |
| I. Total operating income | 250,015,152.23 | 249,492,261.24 |
| Including: Operating income | 250,015,152.23 | 249,492,261.24 |
| Interest income |
| Insurance gained |
commission income
| Commission charge and | ||
| II. Total operating cost | 220,692,103.94 | 208,332,636.82 |
| Including: Operating cost | 188,344,177.55 | 173,313,253.96 |
| Interest expense | ||
| Commission charge and |
commission expense
| Cash surrender value | ||
| Net amount of expense of compensation | ||
| Net amount of withdrawal of insurance |
contract reserve
| Bonus expense of guarantee slip | ||
| Reinsurance expense |
| Tax and extras | 4,269,247.42 | 2,614,156.04 |
| Sales expense | 10,947,318.15 | 12,002,312.02 |
| Administrative expense | 19,832,917.21 | 20,807,474.69 |
| R&D expense | ||
| Financial expense | -2,701,556.39 | -404,559.89 |
expenses
108,391.88 1,200,000.00
| Including: Interest | ||
| Interest income | 2,843,386.98 | 1,719,072.16 |
| Add: Other income | 1,575,990.30 | 326,420.16 |
listed with “-”)
23,487,946.52 14,395,758.68
| Investment income (Loss is |
| Including: Investment income |
on affiliated company and joint venture
7,927,787.58 9,683,638.47
income recognition for financial assetsmeasured by amortized cost
| 48 |
Exchange income (Loss is
listed with “-”)
| Exchange income (Loss is |
| Net exposure hedging income |
(Loss is listed with “-”)
value (Loss is listed with “-”)
-617,068.50 -418,952.05
| Income from change of fair |
| Loss of credit impairment |
(Loss is listed with “-”)
-200,149.24
(Loss is listed with “-”)
| Losses of devaluation of asset |
| Income from assets disposal |
(Loss is listed with “-”)
40,765.92 56,242.77
“-”)
53,610,533.29 55,519,093.98
| III. Operating profit (Loss is listed with | ||
| Add: Non-operating income | 295,807.48 | 72,884.60 |
| Less: Non-operating expense | 237.72 | 9,945.86 |
| IV. Total profit (Loss is listed with “-”) | 53,906,103.05 | 55,582,032.72 |
| Less: Income tax expense | 10,808,747.89 | 11,085,413.51 |
| V. Net profit (Net loss is listed with “-”) | 43,097,355.16 | 44,496,619.21 |
| (i) Classify by business continuity |
(net loss listed with ‘-”)
43,097,355.16 44,496,619.21
| 1.continuous operating net profit |
| 2.termination of net profit (net loss |
listed with ‘-”)
| (ii) Classify by ownership |
of parent company
43,480,236.19 44,542,715.32
| 1.Net profit attributable to owner’s |
| 2.Minority shareholders’ gains and |
losses
-382,881.03 -46,096.11
income
| VI. Net after-tax of other comprehensive |
| Net after-tax of other comprehensive |
income attributable to owners of parentcompany
items which will not be reclassifiedsubsequently to profit of loss
| (I) Other comprehensive income |
| 1.Changes of the defined |
benefit plans that re-measured
income under equity method that cannotbe transfer to gain/loss
| 2.Other comprehensive |
| 3.Change of fair value of |
investment in other equity instrument
| 49 |
4.Fair value change of
enterprise's credit risk
| 4.Fair value change of | ||
| 5. Other | ||
| (ii) Other comprehensive income |
items which will be reclassifiedsubsequently to profit or loss
income under equity method that cantransfer to gain/loss
| 1.Other comprehensive |
| 2.Change of fair value of |
other debt investment
re-classify to other comprehensiveincome
| 3.Amount of financial assets |
| 4.Credit impairment |
provision for other debt investment
| 5.Cash flow hedging reserve | ||
| 6.Translation differences |
arising on translation of foreign currencyfinancial statements
| 7.Other |
income attributable to minorityshareholders
| Net after-tax of other comprehensive | ||
| VII. Total comprehensive income | 43,097,355.16 | 44,496,619.21 |
| Total comprehensive income |
attributable to owners of parentCompany
43,480,236.19 44,542,715.32
attributable to minority shareholders
-382,881.03 -46,096.11
| Total comprehensive income | ||
| VIII. Earnings per share: | ||
| (i) Basic earnings per share | 0.1009 | 0.1033 |
| (ii) Diluted earnings per share | 0.1009 | 0.1033 |
Legal Representative: Fu ChunlongPerson in charge of Accounting Works: Lou HongPerson in charge of Accounting Institution: Lou Hong
4. Profit Statement of Parent Company
Unit: RMB/CNY
| Item | 2022 semi-annual | 2021 semi-annual |
| 50 |
I. Operating income
| I. Operating income | 12,666,278.27 | 19,483,635.23 |
| Less: Operating cost | 5,003,948.63 | 5,163,217.03 |
| Taxes and surcharge | 609,206.45 | 717,195.50 |
| Sales expenses | ||
| Administration expenses | 16,849,325.25 | 16,198,882.72 |
| R&D expenses |
| Financial expenses | -1,323,024.22 | -671,872.77 |
expenses
| Including: Interest | ||
| Interest income | 1,330,174.79 | 659,566.06 |
| Add: Other income | 111,156.14 |
listed with “-”)
13,643,736.16 14,609,726.37
| Investment income (Loss is |
| Including: Investment income |
on affiliated Company and joint venture
7,927,787.58 12,534,155.42
income recognition for financial assetsmeasured by amortized cost (Loss islisted with “-”)
| The termination of |
| Net exposure hedging income |
(Loss is listed with “-”)
(Loss is listed with “-”)
-390,005.49 -110,023.28
| Changing income of fair value |
| Loss of credit impairment |
(Loss is listed with “-”)
(Loss is listed with “-”)
| Losses of devaluation of asset |
| Income on disposal of assets |
(Loss is listed with “-”)
“-”)
4,891,708.97 12,575,915.84
| II. Operating profit (Loss is listed with | ||
| Add: Non-operating income | 74,563.02 | 19,127.02 |
| Less: Non-operating expense | ||
| III. Total Profit (Loss is listed with “-”) | 4,966,271.99 | 12,595,042.86 |
| Less: Income tax | 554,379.86 | 54,954.66 |
| IV. Net profit (Net loss is listed with “-”) | 4,411,892.13 | 12,540,088.20 |
| (i) continuous operating net profit |
(net loss listed with ‘-”)
4,411,892.13 12,540,088.20
loss listed with ‘-”)
| (ii) termination of net profit (net |
| V. Net after-tax of other comprehensive |
income
items which will not be reclassified
| 51 |
subsequently to profit of loss
| subsequently to profit of loss |
| 1.Changes of the defined |
benefit plans that re-measured
income under equity method that cannotbe transfer to gain/loss
| 2.Other comprehensive |
| 3.Change of fair value of |
investment in other equity instrument
enterprise's credit risk
| 4.Fair value change of | ||
| 5. Other | ||
| (ii) Other comprehensive income |
items which will be reclassifiedsubsequently to profit or loss
income under equity method that cantransfer to gain/loss
| 1.Other comprehensive |
| 2.Change of fair value of |
other debt investment
re-classify to other comprehensiveincome
| 3.Amount of financial assets |
| 4.Credit impairment |
provision for other debt investment
| 5.Cash flow hedging reserve | ||
| 6.Translation differences |
arising on translation of foreign currencyfinancial statements
| 7.Other | ||
| VI. Total comprehensive income | 4,411,892.13 | 12,540,088.20 |
| VII. Earnings per share: |
| (i) Basic earnings per share | ||
| (ii) Diluted earnings per share |
5. Consolidated Cash Flow Statement
Unit: RMB/CNY
| Item | 2022 semi-annual | 2021 semi-annual |
| I. Cash flows arising from operating |
activities:
commodities and providing laborservices
233,540,881.93 255,459,153.13
| Cash received from selling | ||
| Net increase of customer deposit |
| 52 |
and interbank deposit
| and interbank deposit |
| Net increase of loan from central |
bank
from other financial institution
| Net increase of capital borrowed |
| Cash received from original |
insurance contract fee
business
| Net cash received from reinsurance |
| Net increase of insured savings and |
investment
commission charge and commission
| Cash received from interest, | ||
| Net increase of capital borrowed |
capital
| Net increase of returned business |
| Net cash received by agents in sale |
and purchase of securities
| Write-back of tax received | 11,847,129.45 |
operating activities
95,434,828.86 73,388,884.28
| Other cash received concerning |
| Subtotal of cash inflow arising from |
operating activities
340,822,840.24 328,848,037.41
commodities and receiving labor service
173,793,008.62 141,066,170.40
| Cash paid for purchasing |
| Net increase of customer loans and |
advances
bank and interbank
| Net increase of deposits in central |
| Cash paid for original insurance |
contract compensation
| Net increase of capital lent |
charge and commission
| Cash paid for interest, commission |
| Cash paid for bonus of guarantee |
slip
| Cash paid to/for staff and workers | 32,931,967.00 | 30,623,586.20 |
| Taxes paid | 48,368,592.66 | 20,257,855.77 |
operating activities
97,047,567.37 77,329,026.02
| Other cash paid concerning |
| Subtotal of cash outflow arising from |
operating activities
352,141,135.65 269,276,638.39
activities
-11,318,295.41 59,571,399.02
| 53 |
II. Cash flows arising from investing
activities:
| II. Cash flows arising from investing |
| Cash received from recovering |
investment
699,334,600.00 896,400,000.00
income
21,775,312.96 4,969,394.03
| Cash received from investment |
| Net cash received from disposal of |
fixed, intangible and other long-termassets
361,050.00 334,000.00
subsidiaries and other units
| Net cash received from disposal of |
| Other cash received concerning |
investing activities
activities
721,470,962.96 901,703,394.03
| Subtotal of cash inflow from investing |
| Cash paid for purchasing fixed, |
intangible and other long-term assets
50,916,178.95 37,930,602.45
| Cash paid for investment | 700,000,000.00 | 794,280,000.00 |
| Net increase of mortgaged loans |
and other units obtained
| Net cash received from subsidiaries |
| Other cash paid concerning |
investing activities
18,669.20
activities
750,934,848.15 832,210,602.45
| Subtotal of cash outflow from investing |
| Net cash flows arising from investing |
activities
-29,463,885.19 69,492,791.58
activities:
| III. Cash flows arising from financing |
| Cash received from absorbing |
investment
absorbing minority shareholders’investment by subsidiaries
| Including: Cash received from | ||
| Cash received from loans | 34,897,377.72 | 29,715,060.10 |
financing activities
| Other cash received concerning |
| Subtotal of cash inflow from financing |
activities
34,897,377.72 29,715,060.10
| Cash paid for settling debts | 5,000,000.00 |
distributing or interest paying
11,880,454.55 9,165,434.86
| Cash paid for dividend and profit |
| Including: Dividend and profit of |
minority shareholder paid by subsidiaries
| 54 |
Other cash paid concerning
financing activities
| Other cash paid concerning |
| Subtotal of cash outflow from financing |
activities
16,880,454.55 9,165,434.86
activities
18,016,923.17 20,549,625.24
| Net cash flows arising from financing |
| IV. Influence on cash and cash |
equivalents due to fluctuation inexchange rate
280.60 -16,779.45
equivalents
-22,764,976.83 149,597,036.39
| V. Net increase of cash and cash |
| Add: Balance of cash and cash |
equivalents at the period -begin
211,655,585.86 208,462,656.63
at the period -end
188,890,609.03 358,059,693.02
6. Cash Flow Statement of Parent Company
Unit: RMB/CNY
VI. Balance of cash and cash equivalents
Item
| Item | 2022 semi-annual | 2021 semi-annual |
| I. Cash flows arising from operating |
activities:
commodities and providing laborservices
9,407,009.79 4,331,488.77
| Cash received from selling | ||
| Write-back of tax received | 8,332,462.70 |
operating activities
90,848,952.57 145,968,999.79
| Other cash received concerning |
| Subtotal of cash inflow arising from |
operating activities
108,588,425.06 150,300,488.56
commodities and receiving labor service
| Cash paid for purchasing | ||
| Cash paid to/for staff and workers | 16,512,716.41 | 14,532,885.73 |
| Taxes paid | 1,644,445.17 | 1,621,570.18 |
operating activities
11,334,575.98 47,698,960.71
| Other cash paid concerning |
| Subtotal of cash outflow arising from |
operating activities
29,491,737.56 63,853,416.62
activities
79,096,687.50 86,447,071.94
| Net cash flows arising from operating |
| II. Cash flows arising from investing |
activities:
investment
550,000,000.00 269,900,000.00
| 55 |
Cash received from investment
income
20,715,948.58 2,175,570.95
| Cash received from investment |
| Net cash received from disposal of |
fixed, intangible and other long-termassets
subsidiaries and other units
| Net cash received from disposal of |
| Other cash received concerning |
investing activities
activities
570,715,948.58 272,075,570.95
| Subtotal of cash inflow from investing |
| Cash paid for purchasing fixed, |
intangible and other long-term assets
50,177,507.00 33,234,690.43
| Cash paid for investment | 639,500,000.00 | 339,000,000.00 |
| Net cash received from subsidiaries |
and other units obtained
investing activities
200,150.00
| Other cash paid concerning |
| Subtotal of cash outflow from investing |
activities
689,677,507.00 372,434,840.43
activities
-118,961,558.42 -100,359,269.48
| Net cash flows arising from investing |
| III. Cash flows arising from financing |
activities:
investment
| Cash received from absorbing | ||
| Cash received from loans | 34,897,377.72 | 29,715,060.10 |
financing activities
| Other cash received concerning |
| Subtotal of cash inflow from financing |
activities
34,897,377.72 29,715,060.10
| Cash paid for settling debts | ||
| Cash paid for dividend and profit |
distributing or interest paying
11,880,454.55 9,116,132.76
financing activities
| Other cash paid concerning |
| Subtotal of cash outflow from financing |
activities
11,880,454.55 9,116,132.76
activities
23,016,923.17 20,598,927.34
| Net cash flows arising from financing |
| IV. Influence on cash and cash |
equivalents due to fluctuation inexchange rate
| V. Net increase of cash and cash | -16,847,947.75 | 6,686,729.80 |
| 56 |
equivalents
| equivalents |
| Add: Balance of cash and cash |
equivalents at the period -begin
95,207,575.71 42,609,260.98
at the period -end
78,359,627.96 49,295,990.78
7. Statement of Changes in Owners’ Equity (Consolidated)
Current Amount
Unit: RMB/CNY
Item
VI. Balance of cash and cash equivalents
Semi-annual of 2022
| Semi-annual of 2022 | |
| Owners’ equity attributable to the parent Company | |
MinorityinterestsTotalowners’equi
tyShar
ecapital
Other
CapitalreserveLess:
Inventor
yshar
es
Oth
ercomprehensiveincome
Reasonablereserve
Surp
lusreserve
Provision ofgene
ralrisk
Retainedprof
it
Oth
er
SubtotalPreferre
dstoc
k
| equity instrument | ||
| Perp | ||
etualcapitalsecuritie
OtherI. The endingbalance ofthe previousyear
| s | ||
| 431, |
058,320.
| 00 | 431, |
449,554.
26,4
22.0
| 51 | 26,5 |
46,4
80.0
| 9 | 543, |
843,496.
| 85 | 1,43 |
2,924,27
| 3.45 | 24,2 |
65,5
52.3
| 5 | 1,45 |
7,189,82
| 5.80 | ||
| Add: |
Changes ofaccounting
| policy |
| Error |
correction ofthe last
| period |
| Enterprise |
combineunder the
| same control | |||||||||||||||
| Other | |||||||||||||||
| II. The |
beginningbalance ofthe current
431,058,320.
431,449,554.
26,4
22.0
26,546,4
80.0
543,843,496.
1,432,924,27
3.45
24,265,5
52.3
1,457,189,82
5.80
| year |
| III. Increase/ |
Decrease inthe period(Decrease islisted with
32,698,6
90.4
32,698,6
90.4
-382,881.
32,315,8
09.4
(i) Totalcomprehensive income
| “-”) | ||
| 43,4 |
80,2
36.1
| 9 | 43,4 |
80,2
36.1
| 9 | - |
382,881.
| 03 | 43,0 |
97,3
55.1
| 6 | ||
| (ii) Owners’ |
devoted anddecreased
| capital | |||||||||||||||
| 1.Common |
| 57 |
shares
invested by
| shareholders |
| 2. Capital |
invested byholders ofother equity
| instruments |
| 3. Amount |
reckonedinto ownersequity withshare-based
| payment | |||||||||||||||
| 4. Other |
(iii) Profitdistribution
10,781,5
45.7
| 5 |
10,781,5
45.7
| 5 |
10,781,5
45.7
| 5 | ||
| 1. |
Withdrawalof surplus
| reserves |
| 2. |
Withdrawalof generalrisk
3.Distributionfor owners(orshareholders)
-10,781,5
45.7
| provisions | ||
| 5 |
-10,781,5
45.7
-10,781,5
45.7
| 5 | 5 | ||||||||||||||
| 4. Other | |||||||||||||||
| (iv) Carrying |
forwardinternalowners’
| equity |
| 1. Capital |
reservesconversed tocapital (share
| capital) |
| 2. Surplus |
reservesconversed tocapital (share
| capital) |
| 3. |
Remedyingloss withsurplus
| reserve |
| 4. Carry-over |
retainedearningsfrom thedefined
| benefit plans |
| 5. Carry-over |
retainedearnings
| 58 |
comprehensive income
| comprehensive income | |||||||||||||||
| 6. Other | |||||||||||||||
| (v) |
Reasonable
| reserve |
| 1. |
Withdrawalin the report
| period |
| 2. Usage in |
the report
| period | |||||||||||||||
| (vi) Others |
IV. Balanceat the end ofthe period
431,058,320.
431,449,554.
| 00 | 51 |
26,4
22.0
26,546,4
80.0
576,542,187.
| 9 | 29 |
1,465,622,96
23,882,6
71.3
| 3.89 | 2 |
1,489,505,63
Amount of the previous period
Unit: RMB/CNY
Item
5.21
Semi-annual of 2021
| Semi-annual of 2021 | |
| Owners’ equity attributable to the parent Company | |
MinorityinterestsTotalowners’equi
tyShar
ecapital
Other
Capi
talreserve
Less
:
Inventor
yshar
es
Oth
ercomprehensiveincome
Reasonablereserve
Surp
lusreserve
Provision ofgene
ralrisk
Retainedprof
it
Oth
er
SubtotalPreferre
dstoc
k
| equity instrument | ||
| Perp | ||
etualcapitalsecuritie
OtherI. The endingbalance ofthe previousyear
| s | ||
| 431, |
058,320.
| 00 | 431, |
449,554.
26,4
22.0
| 51 | 23,8 |
48,4
85.6
| 2 | 424, |
141,893.
| 34 | 1,31 |
0,524,67
| 5.47 | 74,1 |
21,4
26.3
| 4 | 1,38 |
4,646,10
| 1.81 | ||
| Add: |
Changes ofaccounting
| policy |
| Error |
correction ofthe last
| period |
| Enterprise |
combineunder the
| same control | |||||||||||||||
| Other | |||||||||||||||
| II. The |
beginningbalance ofthe current
431,058,320.
431,449,554.
26,4
22.0
23,848,4
85.6
424,141,893.
1,310,524,67
5.47
74,121,4
26.3
1,384,646,10
1.81
| year |
| III. Increase/ |
Decrease inthe period(Decrease islisted with
35,921,5
48.9
35,921,5
48.9
-95,3
98.2
35,826,1
50.7
(i) Total
| “-”) |
| comprehensi |
44,5
44,5
| 42,7 | 42,7 |
-
44,4
| 46,0 | 96,6 |
| 59 |
ve income
| ve income | 15.32 | 15.32 | 96.11 | 19.21 | ||
| (ii) Owners’ |
devoted anddecreased
| capital |
| 1.Common |
sharesinvested by
| shareholders |
| 2. Capital |
invested byholders ofother equity
| instruments |
| 3. Amount |
reckonedinto ownersequity withshare-based
| payment | |||||||||||||||
| 4. Other |
(iii) Profitdistribution
8,621,16
| 6.40 |
8,621,16
| 6.40 | - |
49,3
02.1
| 0 | - |
8,670,46
| 8.50 | ||
| 1. |
Withdrawalof surplus
| reserves |
| 2. |
Withdrawalof generalrisk
| provisions |
| 3. |
Distributionfor owners(or
-8,621,16
6.40
-8,621,16
6.40
-49,3
02.1
-8,670,46
8.50
| shareholders) | |||||||||||||||
| 4. Other | |||||||||||||||
| (iv) Carrying |
forwardinternalowners’
| equity |
| 1. Capital |
reservesconversed tocapital (share
| capital) |
| 2. Surplus |
reservesconversed tocapital (share
| capital) |
| 3. |
Remedyingloss withsurplus
| reserve |
| 4. Carry-over |
retainedearnings
| 60 |
definedbenefit plans
| defined benefit plans |
| 5. Carry-over |
retainedearningsfrom othercomprehensi
| ve income | |||||||||||||||
| 6. Other | |||||||||||||||
| (v) |
Reasonable
| reserve |
| 1. |
Withdrawalin the report
| period |
| 2. Usage in |
the report
| period | |||||||||||||||
| (vi) Others |
IV. Balanceat the end ofthe period
058,320.
| 00 |
449,554.
| 51 |
26,4
22.0
48,4
85.6
| 2 |
063,442.
| 26 |
6,446,22
| 4.39 | 74,0 |
26,0
28.1
| 3 | 1,42 |
0,472,25
8. Statement of Changes in Owners’ Equity (Parent Company)
Current Amount
Unit: RMB/CNY
Item
2.52
Semi-annual of 2022
Sharecapital
Other
| Semi-annual of 2022 | ||
| equity instrument | ||
Capitalreserv
e
Less:
Invent
oryshares
Othercomprehensi
veincom
e
Reasonablereserve
Surplu
sreserv
e
Retain
edprofit
Other
Totalowner
s’equityPrefer
redstock
ualcapitalsecurit
| ies |
Other
balance ofthe previous
| year |
431,058,32
0.00
428,256,13
1.23
26,546,480.
203,041,32
7.99
1,088,902,2
59.31
Changes ofaccounting
| policy |
correction ofthe last
| period |
| Other | ||||||||||||
| II. The |
beginningbalance ofthe current
431,058,32
0.00
428,256,13
1.23
26,546,480.
203,041,32
7.99
1,088,902,2
59.31
| year |
| III. Increase/ |
Decrease inthe period(Decrease islisted with
-6,369,
653.6
-6,369,
653.6
| “-”) | ||||||||||||
| (i) Total | 4,411, | 4,411, |
| 61 |
comprehensi
ve income
| comprehensi | 892.13 | 892.13 | ||
| (ii) Owners’ |
devoted anddecreased
| capital |
| 1.Common |
sharesinvested by
| shareholders |
| 2. Capital |
invested byholders ofother equity
| instruments |
| 3. Amount |
reckonedinto ownersequity withshare-based
| payment | ||||||||||||
| 4. Other |
(iii) Profitdistribution
10,781,545.
| 75 |
10,781,545.
| 75 | ||
| 1. |
Withdrawalof surplus
| reserves |
| 2. |
Distributionfor owners(or
-10,781,545.
-10,781,545.
| shareholders) | ||||||||||||
| 3. Other | ||||||||||||
| (iv) Carrying |
forwardinternalowners’
| equity |
| 1. Capital |
reservesconversed tocapital (share
| capital) |
| 2. Surplus |
reservesconversed tocapital (share
| capital) |
| 3. |
Remedyingloss withsurplus
| reserve |
| 4. Carry-over |
retainedearningsfrom thedefined
| benefit plans |
| 5. Carry-over |
retained
| 62 |
from other
comprehensi
| ve income | ||||||||||||
| 6. Other | ||||||||||||
| (v) |
Reasonable
| reserve |
| 1. |
Withdrawalin the report
| period |
| 2. Usage in |
the report
| period | ||||||||||||
| (vi) Others |
IV. Balanceat the end ofthe period
58,32
| 0.00 |
56,13
| 1.23 |
6,480.
| 09 | 196,6 |
71,67
| 4.37 | 1,082, |
532,6
Amount of the previous period
Unit: RMB/CNY
Item
05.69
Semi-annual of 2021
Sharecapital
Other
| Semi-annual of 2021 | ||
| equity instrument | ||
Capita
lreserve
Less:
Invent
oryshares
Othercomprehensi
veincom
e
Reasonablereserv
e
Surplu
sreserv
e
Retain
edprofit
Other
Totalowner
s’equityPrefer
redstock
ualcapitalsecurit
| ies |
Other
balance ofthe previous
| year |
431,058,32
0.00
428,256,13
1.23
23,848,485.
187,380,54
4.20
1,070,543,4
81.05
Changes ofaccounting
| policy |
correction ofthe last
| period |
| Other | ||||||||||||
| II. The |
beginningbalance ofthe current
431,058,32
0.00
428,256,13
1.23
23,848,485.
187,380,54
4.20
1,070,543,4
81.05
| year |
| III. Increase/ |
Decrease inthe period(Decrease islisted with
3,918,
921.8
3,918,
921.8
(i) Totalcomprehensive income
| “-”) | ||
| 12,54 |
0,088.
| 20 | 12,54 |
0,088.
| 20 | ||
| (ii) Owners’ |
devoted anddecreased
| capital |
| 1.Common |
sharesinvested by
| 63 |
2. Capital
invested byholders ofother equity
| instruments |
reckonedinto ownersequity withshare-based
| payment |
| 4. Other |
(iii) Profitdistribution
-8,621,
166.4
-8,621,
166.4
| 0 | 0 | |||
| 1. |
Withdrawalof surplus
| reserves |
| 2. |
Distributionfor owners(or
-8,621,
166.4
-8,621,
166.4
| shareholders) | ||||||||||||
| 3. Other | ||||||||||||
| (iv) Carrying |
forwardinternalowners’
| equity |
| 1. Capital |
reservesconversed tocapital (share
| capital) |
| 2. Surplus |
reservesconversed tocapital (share
| capital) |
| 3. |
Remedyingloss withsurplus
| reserve |
| 4. Carry-over |
retainedearningsfrom thedefined
| benefit plans |
| 5. Carry-over |
retainedearningsfrom othercomprehensi
| ve income | ||||||||||||
| 6. Other | ||||||||||||
| (v) |
Reasonable
| reserve |
| 1. |
Withdrawal
| 64 |
period
| period |
| 2. Usage in |
the report
| period | ||||||||||||
| (vi) Others |
IV. Balanceat the end ofthe period
58,32
| 0.00 |
56,13
| 1.23 |
8,485.
| 62 | 191,2 |
99,46
| 6.00 | 1,074, |
462,4
II. Company information
1. Company profile
Shenzhen Tellus Holding Co., Ltd. (hereinafter referred to as the Company or Company) is a limited company thatreorganized and established from former Shenzhen Machinery Industry Company, as authorized by the replyrelating to Shenzhen Machinery Industry Company transforming to Shenzhen Testrite Machinery Co.,Ltd(SFBF[1991]1012) issued by the Office of Shenzhen People Government, registered in ShenzhenAdministration for Industry & Commerce on November 10, 1986. The Company holds a business license withunified social credit code of 91440300192192210U, and with a registered capital of RMB431,058,320.00 and atotal number of 431,058,320 shares, including unrestricted outstanding 392,778,320 shares (A-stock) and38,280,000 shares (B-stock). Operating address of the HQ located at 3/F, 4/F, Tellus Building, Shuibei Er Road,Luohu District, Shenzhen. Legal representative: Fu Chunlong.
In 1993, as authorized by the reply relating to Shenzhen Testrite Machinery Co., Ltd. transforming to a publiccompany (SFBF[1992]1850) issued by the Office of Shenzhen People Government and the reply relating to issuanceof stocks by Shenzhen Testrite Machinery and Electric Co., Ltd. (SRYFZ[1993]092) issued by Shenzhen branch ofPeople’s Bank of China, the Company changed to be a public company and made the initial public offering.Registered capital amounting to RMB 166,880,000.00 with a total share capital of 166,880,000 shares, among which,120,900,000 shares were converted from the original assets and 25,980,000 shares (A-stock) and 20,000,000 shares(B-stock) were issued. Par value of the shares is RMB 1 per share. On June 21, 1993, shares of the Company werelisted for trading on Shenzhen Stock Exchange.
According to the resolution of Annual General Meeting of 1993, on the basis of 166,880,000 shares as of December31 of that year, 2 shares for every 10 shares and a cash dividend of 0.5 yuan per 10 shares were distributed to allshareholders, totaling 33,376,000 shares distributed and was implemented in 1994. Registered capital of theCompany increased to RMB 200,256,000.00 after the share distribution.
According to the resolution of Annual General Meeting of 1994, on the basis of 200,256,000 shares as of December31 of that year, 0.5 shares for every 10 shares and 0.5 shares transferred, and a cash dividend of 0.5 yuan per 10shares were distributed to all shareholders, totaling 20,025,600 shares transferred and was implemented in 1995.Registered capital of the Company increased to RMB 220,281,600.00 after the share transferred and distribution.
| 65 |
According to the resolution of 4
thextraordinary general meeting of shareholders of 2014, and approved by the“Reply on the Non-Public Offering of Shares of Shenzhen Tellus Holding Co., Ltd.”(Securities Regulatory License[2015] No.173) from China Securities Regulatory Commission, the Company offering ordinary A stock of77,000,000 shares to Shenzhen Special Development Group Co., Ltd and Shenzhen Yuanzhi Fuhai Jewelry IndustryInvestment Enterprise (Limited Partnership) non-publicly in 2015. Register capital of the Company increased toRMB 297,281,600.00 after the shares increased.
According to the resolution of Annual General Meeting of 2018, on the basis of 297,281,600 shares as of December31 of that year, transferred 4.5 shares for every 10 shares to all shareholders from the capital surplus,totaling133,776,720 shares transferred and was implemented in 2019. Registered capital of the Company increasedto RMB 431,058,320.00 after the transferred.
Main business of the Company including auto sales, auto maintenance and inspection, sales of jewelry and propertyleasing and services, etc.
Approval date of the financial statement: the financial statements were approved by the Board on August 24, 2022.
2. Scope and change of the consolidate financial statement
(1)subsidiary included in the consolidate statement at end of the Period
| No. | Subsidiary | Abbreviations | Shareholding ratio % | |
| Directly | Indirectly | |||
| 1 | Shenzhen Tellus Xinyongtong Automobile | |||
Development Co. Ltd
Development Company
| Xinyongtong Automobile | 5.00 | 95.00 | ||
| 2 | Shenzhen Bao’an Shiquan Industrial Co., Ltd. | Bao’an Shiquan Company | 100.00 |
| 3 | Shenzhen SDG Tellus Real Estate Co., Ltd. | Tellus Real Estate Company | 100.00 | |
| 4 | Shenzhen Tellus Chuangying Tech. Co., Ltd. | Chuangying Company | 100.00 | |
| 5 | Shenzhen Xinyongtong Auto Vehicle Inspection |
Equipment Co., Ltd.
Company
| Inspection Equipment | 51.00 | |||
| 6 | Shenzhen Auto Industry and Trade Corporation | Auto Industry and Trade |
Company
| 100.00 | ||||
| 7 | Shenzhen Automotive Industry Supply Corporation | Automotive Supply |
Corporation
| 100.00 | ||||
| 8 | Shenzhen SDG Huari Auto Enterprise Co., Ltd. | Huari Company | 60.00 |
| 9 | Shenzhen Huari Anxin Automobile Inspection Ltd. | Huari Anxin Company | 100.00 | |
| 10 | Shenzhen Zhongtian Industrial Co,. Ltd. | Zhongtian Company | 100.00 |
| 66 |
| 11 | Shenzhen Huari TOYOTA Automobile Sales Service |
Co., Ltd.
| Huari Toyota | 60.00 | |||
| 12 | Shenzhen Tellus Treasury Supply Chain Tech. Co., |
Ltd.
Company
| Treasury Supply Chain | 100.00 | |||
| 13 | Shenzhen Jewelry Industry Service Co., LTD | Shenzhen Jewelry Company | 65.00 | |
| 14 | Shanghai Fanyue Diamond Co., Ltd. | Shanghai Fanyue | 100.00 |
Found more in the NoteⅧ.“Equity in other entity”
III. Basis Preparation of the Financial Statements
1.Preparation basis
The Company’s financial statements have been prepared based on the going concern and the actual transactions andevents. And recognized and measured in accordance with the provisions of the ASBE and its application guidelinesand interpretations of the standards. Furthermore, the Company discloses relevant financial information inaccordance with the “Regulation on the Preparation of Information Disclosures of Companies Issuing PublicShares, No. 15- General Provision on Financial Reports”(Revised in 2014) of China Securities RegulatoryCommission.
2. Going concern
The Company has assessed its ability to continue as a going concerned for the 12 months since end of the reportingperiod, and there are no matters affecting the ability to continue as a going concern being found. It is reasonable forthe Company to prepare the financial statements on a going concern basis.
IV. Important accounting policy & accounting estimation
Specific accounting policies and estimation attention:
The following important accounting policies and estimation are formulated in line with the Accounting Standardsfor Business Enterprises(ASBE). The business without mentioned are carried out in accordance with the relevantaccounting policies of ASBEs.
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The Financial Statements are up to requirements of Accounting Standards for Business Enterprises, and reflect thefinancial status, operation results, changes of owners equity and cash flows of the Company in reporting period intruthfulness and completeness.
| 67 |
2. Accounting period
Accounting period of the Company is falls to the range starting from 1 January to 31 December.
3. Operating cycle
The normal operating cycle of the Company is one year.
4. Standard currency
The recording currency of the Company is Renminbi(RMB/CNY)
5. Accounting treatment methods of business combination under the same control and not under the same
control
(1) Business combination under the same control
The assets and liabilities acquired by the Company in the business combination shall be measured at the book valueof the combined party in the consolidated financial statements of the final controlling party on the date ofcombination. Among them, if the accounting policies adopted by the combined party and the Company before thebusiness combination are different, the accounting policies shall be unified based on the importance principle, thatis, the book value of the assets and liabilities of the combined party shall be adjusted according to the accountingpolicies of the Company. If there is a difference between the book value of the net assets acquired in the businesscombination and the book value of the consideration paid by the Company, the Company shall first adjust the capitalreserve (capital premium or equity premium). If the balance of the capital reserve (capital premium or equitypremium) is insufficient to offset, the surplus reserve and undistributed profit shall be offset successively.
For the accounting treatment of a business combination under the same control through step-by-step transactions,please see Notes Ⅳ. 6.
(2) Business combination not under the same control
The identifiable assets and liabilities of the acquiree acquired by the Company in the business combination shall bemeasured at their fair value on the purchase date. Among them, if the accounting policies adopted by the acquireeand the Company before the business combination are different, the accounting policies shall be unified based onthe materiality principle, that is, the book value of the assets and liabilities of the acquiree shall be adjusted accordingto the accounting policies of the Company. The difference between the combined cost of the Company on theacquisition date and the fair value of the identifiable assets and liabilities of the acquiree acquired by the purchaserin the business combination shall be recognized as goodwill; if the combined cost is less than the difference of fairvalue of the identifiable assets and liabilities of the acquiree acquired in the business combination, first of all, thecombined cost and the fair value of the identifiable assets and liabilities of the acquiree acquired in the businesscombination shall be reviewed, after review, if the combined cost is still less than the fair value of the identifiable
| 68 |
assets and liabilities of the acquiree, the difference shall be recognized as consolidated profits and losses for thecurrent period.
For the accounting treatment of a business combination not under the same control through step-by-step transactions,please see Notes Ⅳ. 6.
(3) Disposal of transaction costs in business combination
The intermediary fees for auditing, legal services, evaluation and consultation and other related administrativeexpenses incurred for the business combination shall be recorded into the current profits and losses when incurred.Transaction costs of equity securities or debt securities issued as consideration for the merger are included in theinitial recognition amount of the equity securities or debt securities.
6. Methods for preparation of consolidated financial statements
(1) Determination of the consolidated scope
The consolidated scope of the consolidated financial statements is determined on the basis of control, including notonly subsidiaries as determined by voting rights (or similar voting rights) on their own or in combination with otherarrangements, but also structured entities as determined by one or more contractual arrangements.
Control means that the Company has the power over the investee, enjoys variable returns by participating in relatedactivities of the investee, and has the ability to use the power over the investee to influence the amount of return. Asubsidiary is an entity under the control of the Company (including the separable part of an enterprise and aninvested entity, and the structured entity controlled by the enterprise, etc.), a structured entity is one that is designedwithout taking the right to vote or similar rights as a determining factor when determining its controlling party (Note:
sometimes it is also known as the entity of special purpose).
(2) Special provisions on the parent company being an investment entity
If the parent company is an investment entity, only those subsidiaries that provide relevant services for theinvestment activities of the investment entity will be included in the consolidation scope, and other subsidiaries willnot be merged. Equity investors of the subsidiaries that are not included in the consolidation scope are recognizedas financial assets measured at fair value and their changes are recorded in the profits and losses of current period.
When the parent company simultaneously satisfies the following conditions, the parent company is an investmententity:
① The company obtains funds from one or more investors for the purpose of providing investment management
services to investors.
② The sole purpose of the company's operation is to provide returns to investors through capital appreciation,
investment income, or both.
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③ The company considers and evaluates the performance of almost all investments in accordance with the fair
value.
When the parent company changes from the non-investment entity into the investment entity, except only includethe subsidiaries providing related services for their investment activities into the scope of consolidated financialstatements, the company no longer merge other subsidiaries since the change day, and deal with according to theprinciple of disposing subsidiary equity but not losing the right of control.
When the parent company changes from the investment entity into the non-investment entity, the subsidiaryoriginally not included in the scope of consolidated financial statements shall be included into the scope ofconsolidated financial statements on the change day, the fair value of the subsidiary originally not included in thescope of consolidated financial statements on the change day shall be regarded as the trading consideration ofpurchase, and deal with according to the accounting treatment method for business combination not under the samecontrol.
(3) Preparation method of consolidated financial statements
The Company shall, on the basis of its own financial statements and those of its subsidiaries, prepare consolidatedfinancial statements in accordance with other relevant information.
When preparing consolidated financial statements, the Company shall regard the entire enterprise group as anaccounting entity, and reflect the overall financial position, operating results and cash flow of the enterprise groupin accordance with the requirements of recognition, measurement and presentation of relevant accounting standardsfor enterprises, and in accordance with unified accounting policies and accounting periods.
① Merge the assets, liabilities, owners' equity, revenues, expenses and cash flows of the parent company and its
subsidiaries.
② Offset the parent company's long-term equity investment in the subsidiary and the parent company's share in the
owner's equity of the subsidiary.
③ Offset the impact of internal transactions between the parent company and its subsidiaries and among the
subsidiaries. Where the internal transaction indicates the impairment loss of the relevant assets, the loss shall berecognized in full.
④ Adjust special transactions from the perspective of enterprise groups.
(4) Disposal of increase or decrease in subsidiaries during the reporting period
① Increase subsidiaries or businesses
A. A subsidiary or business increased by the business merger under the same control(a) When preparing the consolidated balance sheet, the opening balance of the consolidated balance sheet shall beadjusted, and the relevant items in the comparative statement shall be adjusted, so that the consolidated reporting
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entity shall be deemed to have been in existence since the beginning of the control by the final controlling party.(b) When preparing the consolidated income statement, the revenues, expenses and profits of the subsidiary and itsbusiness combination from the beginning of the current period to the end of the reporting period shall be includedin the consolidated income statement, and relevant items in the comparative statement shall be adjusted, so that theconsolidated reporting entity shall be deemed to have been in existence since the beginning of the control by thefinal controlling party.(c) When preparing the consolidated cash flow statement, the cash flow of the subsidiary and the businesscombination from the beginning of the current period to the end of the reporting period shall be included in theconsolidated cash flow statement, and the relevant items in the comparative statement shall be adjusted, so that theconsolidated reporting entity shall be deemed to have been in existence since the beginning of the control by thefinal controlling party.B. A subsidiary or business added by a business combination not under the same control(a) The opening balance of the consolidated balance sheet shall not be adjusted when preparing the consolidatedbalance sheet.(b) When preparing the consolidated income statement, the income, expenses and profits of the subsidiary and thebusiness from the purchase date to the end of the reporting period shall be included in the consolidated incomestatement.(c) When preparing the consolidated cash flow statement, the cash flow of the subsidiary from the purchase date tothe end of the reporting period shall be included in the consolidated cash flow statement.
② Disposal of subsidiaries or businesses
A. The opening balance of the consolidated balance sheet shall not be adjusted when preparing the consolidatedbalance sheet.B. When preparing the consolidated income statement, the income, expenses and profits of the subsidiary and thebusiness from the beginning of the period to the disposal date shall be included in the consolidated income statement.C. The cash flows of the subsidiary and the business from the beginning of the period to the disposal date shall beincluded in the consolidated cash flow statement when preparing the consolidated cash flow statement.
(5) Special considerations in the merger offset
① The long-term equity investment of the Company held by a subsidiary shall be regarded as the treasury shares
of the Company and listed as "deduct: treasury share" in the consolidated balance sheet under the owner's equityitem as a deduction of the owner's equity. The long-term equity investments held by the subsidiaries shall offsetagainst their respective shares in the owner's equity of the subsidiaries in accordance with the method used by theCompany to offset the equity investments in the subsidiaries.
② "Special reserve" and "general risk reserve" are not paid-up capital (or equity) or capital reserves, and are
different from retained earnings and undistributed profits. After the long-term equity investment and the owner'sequity of the subsidiary offset each other, the "special reserve" and "general risk reserve" shall be restored accordingto the share belonging to the owner of the parent company.
③Where the offsetting of unrealized internal sales gains and losses results in temporary differences between the
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carrying value of assets and liabilities in the consolidated balance sheet and the tax base of their taxable entity, thedeferred income tax assets or deferred income tax liabilities shall be recognized in the consolidated balance sheet,at the same time, the income tax expenses in the consolidated income statement shall be adjusted, except for thedeferred income taxes related to the transactions or events directly included in the owner's equity and the businesscombination.
④The profit and loss of the unrealized internal transaction incurred by the Company in selling assets to subsidiaries
shall fully offset against the "net profit attributable to the owner of the parent company". The profit and loss of theunrealized internal transaction arising from the sale of assets by a subsidiary to the Company shall be distributedand offset between the "net profit attributable to the owner of the parent company" and the "minority shareholders'profit and loss" in accordance with the proportion distributed by the Company to the subsidiary. The profit and lossof the unrealized internal transaction arising from the sale of assets among subsidiaries shall be distributed andoffset between "net profit attributable to the owner of the parent company" and "minority shareholders' profit andloss" in accordance with the distribution ratio of the Company to the subsidiaries of the seller.
⑤If the current loss shared by the minority shareholders of the subsidiary exceeds the minority shareholders' share
in the initial owner's equity of the subsidiary, the balance shall still be offset against the shareholders' equity.
(6) Accounting treatment of special transactions
① Purchase minority shareholder equity
When the Company purchases the equity of a subsidiary owned by the minority shareholder of the subsidiary, theinvestment cost of the long-term equity investment newly acquired through the purchase of minority equity shall bemeasured according to the fair value of the consideration paid in individual financial statements. In the consolidatedfinancial statements, the difference between the newly acquired long-term equity investment due to the purchase ofa minority stake and the share of the net assets of the subsidiary calculated continuously from the purchase date ormerger date according to the new shareholding ratio should adjust the capital reserves (capital premium or stockpremium), if the capital reserves are insufficient to offset, the surplus reserves and undistributed profits shall beoffset in turn.
② Obtaining the control of the subsidiary step by step through multiple transactions
A. Realizing business combination under the same control step by step through multiple transactionsOn the merger date, the Company shall determine the initial investment cost of long-term equity investment in theindividual financial statements according to the share of the net assets of the subsidiaries that shall be enjoyed afterthe merger in the book value of the consolidated financial statements of the ultimate controlling party; The differencebetween the initial investment cost and the book value of the long-term equity investment before the merger plusthe book value of the new payment consideration for further shares acquired on the merger date shall adjust capitalreserves (capital premium or stock premium), if the capital reserves are insufficient to offset, the surplus reservesand undistributed profits shall be offset in turn.
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In the consolidated financial statements, the assets and liabilities of the merged party acquired by the merging partyduring the merger shall be measured according to the book value in the consolidated financial statements of the finalcontrolling party on the merger date, except for the adjustments made due to different accounting policies; Thedifference between the sum of the book value of the investment held before the merger plus the book value of theconsideration paid on the date of merger and the book value of the net assets acquired during the merger shall adjustthe capital reserves (equity premium/capital premium), and adjust the retained earnings if the capital reserves areinsufficient to offset.
Where the equity investment held by the merging party prior to the acquisition of control of the merged party areaccounted for according to the equity method, the changes in relevant profit or loss, other comprehensive incomeand other owners' equity that has been recognized between the date on which the original equity was acquired andthe date on which the merging party and the merged party are in the final control of the same party shall respectivelyoffset against the retained earnings at the beginning of the comparative statement period.B. Realization of business combination under different control step by step through multiple transactionsOn the merger date, in the individual financial statements, the initial investment cost of the long-term equityinvestment on the merger date shall be the sum of the book value of the original long-term equity investment plusthe new investment cost on the merger date.
In the consolidated financial statements, the equity of the acquiree held before the purchase date shall be re-measured according to the fair value of the equity on the purchase date, and the difference between the fair valueand the book value shall be recorded into the investment income of the current period; If the equity held by theacquiree prior to the purchase date involves other comprehensive income under the equity method, the relevantother comprehensive income shall be converted to the current income on the purchase date, except othercomprehensive income generated by the change in net assets or net liabilities of the benefit plan set by the mergedparty. In the notes, the Company shall disclose the fair value on the purchase date of the equity held by the companyprior to the purchase date and the amount of relevant gains or losses generated by re-measurement in accordancewith the fair value.
③ The Company disposes of its long-term equity investment in its subsidiaries without losing control
Where the parent company partially disposes of its long-term equity investment in a subsidiary without losingcontrol, in the consolidated financial statements, the difference between the disposal cost and the subsidiary's shareof the net assets calculated continuously from the purchase date or the merger date corresponding to the disposal ofthe long-term equity investment shall adjust the capital reserves (capital premium or stock premium), if the capitalreserves is insufficient to offset, adjust the retained earnings.
④ The Company disposes of its long-term equity investment in its subsidiaries and loses control
A. One transaction disposalWhere the Company loses the control of the investee due to the disposal of some equity investments and other
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reasons, the remaining equity shall be remeasured according to the fair value of the equity at the date of loss ofcontrol when the consolidated financial statements are prepared. The sum of the consideration obtained from thedisposal of the equity and the fair value of the remaining equity minus the difference between the shares of the netassets of the original subsidiary which should be continuously calculated from the purchase date or merger dateaccording to the original shareholding ratio shall be included into the investment income of the current period whenthe control right is lost.
Other comprehensive income and changes in other owners' equity related to the equity investment of the originalsubsidiary shall be transferred to the current profit and loss when the control right is lost, except other comprehensiveincome generated by changes in net liabilities or net assets of the benefit plan set by the investee.B. Multiple transactions handled in stepsIn the consolidated financial statements, we should first judge whether the step transaction is a "package transaction".
If the step transaction does not belong to the "package transaction", in the individual financial statements, eachtransaction before the loss of control of the subsidiary shall be carried forward with the book value of the long-termequity investment corresponding to the each disposal of equity, and the difference between the income price and thebook value of the disposal of the long-term equity investment shall be included in the current investment income;In the consolidated financial statements, the relevant provisions of "the parent company disposes of its long-termequity investment in the subsidiary without losing control" shall be followed.
If the step transaction is a "package transaction", each transaction shall be accounted for as a transaction for thedisposal of the subsidiary and loss of control; In the individual financial statements, the difference between eachdisposal price before the loss of control and the book value of the long-term equity investment corresponding to thedisposed equity shall be first recognized as other comprehensive income, and then transferred to the current profitand loss of the lost control when the control right is lost; In the consolidated financial statements, for each transactionbefore the loss of control, the difference between the disposal price and the disposal investment corresponding tothe share of the subsidiary's net assets shall be recognized as other comprehensive income, which shall be transferredto the profit and loss of the current period at the time of loss of control.Multiple transactions are usually accounted for as "package transactions" where the terms, conditions and economicimpact of the transactions meet one or more of the following conditions:
(a) The transactions were concluded at the same time or with consideration for their mutual impact.(b) The transactions as a whole are required to achieve a complete commercial outcome.(c) The occurrence of one transaction depends on the occurrence of at least one other transaction.(d) A transaction is not economic when considered in isolation, but it is economic when considered in conjunctionwith other transactions.
⑤ The proportion of equity owned by the parent company is diluted due to the capital increase by minority
shareholders of subsidiary
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The other shareholders (minority shareholders) of the subsidiary increase the capital of the subsidiary, thus dilutingthe shareholding ratio of the parent company to the subsidiary. In the consolidated financial statements, the share ofthe parent company in the book net assets of the subsidiary before the capital increase shall be calculated accordingto the proportion of the parent company's equity before the capital increase, and the difference between this shareand the share of book net assets of the subsidiary after capital increase calculated according to the shareholding ratioof the parent company shall adjust the capital reserve (capital premium or stock premium), if the capital reserves isinsufficient to offset, adjust the retained earnings.
7. Classification of joint venture arrangement and accounting for joint operations
The joint venture arrangement is an arrangement under the common control of two or more participants. Jointventure arrangement of the Company are classified as joint operations and joint ventures.
(1) Joint operations
The joint operation is a joint arrangement in which the Company enjoys the assets and bears the liabilitiesassociated with such arrangement.The Company recognizes the following items that related to its shares of interest in a joint operation and accountsfor them in accordance with the provisions of the Accounting Standards for Business Enterprises (ASBE):
① To recognize separately-held assets and jointly-held assets under its proportion;
②To recognize separately-assumed liabilities and jointly-assumed liabilities under its proportion;
③To recognize revenue from disposal of the output which the Company is entitled to under the proportion;
④To recognize revenue from disposal of the output under the proportion;
⑤To recognize separately occurred expenses, and to recognize expenses occurred for joint operations under its
proportion.
(2) Joint venture
A joint venture is a joint venture arrangement in which the Company has rights only to the net assets of sucharrangement.The Company accounts for its investments in joint ventures in accordance with the regulations of the equity methodof the long-term equity investment.
8. Recognition standards for cash and cash equivalents
Cash refers to the enterprise’s cash on hand and deposits that are readily available for disbursement. The cashequivalents are investments that are held for a short period of time (generally maturing within three months fromthe date of purchase), are highly liquid, are easily convertible to known amounts of cash, and are subject to aninsignificant risk of changes in value.
9. Foreign currency business and conversion of foreign currency statement
(1) Method of determining the conversion rate for foreign currency transactions
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For the initial recognition of foreign currency transactions, the Company shall convert to the standard currency foraccounting at the spot rate on the date of the transaction or at the exchange rate (hereinafter referred to as theapproximate exchange rate of spot rate) determined in accordance with a systematic and reasonable method andsimilar to the spot rate on the date of the transaction.
(2) Conversion method of foreign currency monetary items on the balance sheet date
On the balance sheet date, the spot rate on the balance sheet date is used for conversion for foreign currencymonetary items. The exchange difference resulting from the difference between the spot exchange rate on thebalance sheet date and the spot exchange rate at the initial recognition or the previous balance sheet date shall bebooked into the profit and loss of the current period. For foreign currency non-monetary items measured at historicalcost, the spot exchange rate on the transaction date is still used for conversion; The foreign currency non-monetaryitems measured at fair value shall be converted at the spot exchange rate on the date on which the fair value isdetermined, and the difference between the amount of the standard currency for accounting after conversion and theamount of the original standard currency for accounting shall be recorded into the profits and losses of the currentperiod.
10. Financial instruments
The financial instrument is a contract that forms a financial asset of one party and creates a financial liability orequity instrument of another party.
(1) Recognition and terminate of recognition for a financial instrument
When the Company becomes a party to a financial instrument contract, the relevant financial assets or liabilities arerecognized.
A financial asset is terminate for recognition when one of the following conditions is met:
①the contractual rights to receive the cash flow of such financial assets are terminated:
②the financial assets have been transferred and the following conditions for derecognition of transfer of such
financial assets are met.
Where the current obligation of a financial liability (or any part thereof) has been terminated, the recognition of thefinancial liability (or the part of the financial liability) shall be terminated. If the Company (borrower) and the lendersign an agreement to replace the original financial liabilities by assuming new financial liabilities, and the contractterms of the new financial liabilities and the original financial liabilities are substantially different, the recognitionof the original financial liabilities shall be terminated and the new financial liabilities shall be recognized at thesame time. If the Company materially modifies the contract terms of the original financial liability (or any partthereof), the original financial liability shall be terminated, and at the same time a new financial liability shall berecognized in accordance with the modified terms.
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Accounting recognition and termination of recognition are made on the trading day for buying and selling offinancial assets in the normal way. Conventional buying and selling of financial assets means that the financialassets are delivered in accordance with the terms of the contract and on a schedule determined by regulation ormarket practice. "Trading day" means the date on which the Company commits to buy or sell financial assets.
(2) Classification and measurement of financial assets
In the initial recognition, the Company classifies the financial assets as financial assets measured at the amortizedcost, financial assets measured at fair value and the changes are recorded into the profits and losses of the currentfinancial assets, and financial assets measured at fair value and the changes are included in the financial assets ofother comprehensive income according to the business model for managing financial assets and the contractual cashflow characteristics of the financial assets. Financial assets shall not be reclassified after initial recognition unlessthe Company changes its business model for managing financial assets, in which case all affected relevant financialassets shall be reclassified on the first day of the first reporting period following the change in business model.
Financial assets are measured at fair value when they are initially recognized. For the financial assets measured atfair value and whose changes are included in the current profits and losses, the related transaction costs are directlyincluded in the current profits and losses, and the related transaction costs of other types of financial assets areincluded in the initially recognized amount. For notes receivable and accounts receivable that are generated by thesale of goods or the rendering of services and do not include or take into account a material financing component,the Company will initially measure them in accordance with the transaction price as defined by the revenuestandards.Subsequent measurement of financial assets depends on their classification:
① Financial assets measured at amortized cost
Financial assets simultaneously meet the following conditions are classified as financial assets measured atamortized cost. The Company's business model for managing the financial assets is to collect contract cash flows;the contract terms of the financial assets stipulate that the cash flows generated at a specific date are only paymentof principal and interest based on the amount of outstanding principal. For such financial assets, the effective interestmethod is used for follow-up measurement by the amortized cost, and its termination of recognition, and the profitor loss arising from amortization and impairment by the effective interest rate method are included in the profitsand losses of the current period.
② Financial assets measured at fair value and their changes are included in other comprehensive income
Financial assets simultaneously meet the following conditions are classified as financial assets measured at fairvalue and whose changes are included in other comprehensive income. The Company's business model formanaging the financial assets is not only to collect contract cash flows but also to sell the financial asset; thecontractual terms of the financial assets stipulate that the cash flows generated at a specific date are only payment
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of principal and interest on the amount of outstanding principal. For such financial assets, the fair value is used forsubsequent measurement. Except the impairment loss or gain and the exchange gain or loss are recognized as currentprofits and losses, the changes in fair value of such financial assets are recognized as other comprehensive incomeuntil the termination of recognition of the financial assets, the accumulated gains or losses are transferred into thecurrent profits and losses. However, the relevant interest income of the financial asset calculated by using theeffective interest rate method is included in the profit and loss of the current period.
The Company irrevocably select part of non-transactional equity instrument investment to be designated as financialassets measured at fair value and whose changes are included in other comprehensive income, only the relevantdividend income is recorded into the profits and losses of the current period, fair value changes are recognized asother comprehensive income, and the cumulative profits or losses are transferred into retained earnings until thetermination of recognition of the financial assets.
③ Financial assets measured at fair value and whose changes are included in current profits and losses
Financial assets in addition to the above financial assets measured at amortized cost and financial assets measuredat fair value and whose changes are included in other comprehensive income are classified as financial assetsmeasured at fair value and whose changes are included in current profits and losses. For such financial assets, thefair value is used for subsequent measurement, and all changes in fair value are included in the current profits andlosses.
(3) Classification and measurement of financial liabilities
The Company classifies the financial liabilities as financial liabilities measured at fair value and whose changes areincluded in the profits and losses of the current period, loan commitment and financial guarantee contract liabilitiesbelow market interest rate loans, and financial liabilities measured at amortized cost.The subsequent measurement of a financial liability depends on its classification:
① Financial liabilities measured at fair value and whose changes are included in the profits and losses of the current
periodSuch financial liabilities include tradable financial liabilities (including derivatives belonging to financial liabilities)and financial liabilities designated to be measured at fair value and whose changes are included in current profitsand losses. After initial recognition, the fair value is used for subsequent measurement for such financial liabilities.Except for those related to the hedge accounting, the profits or losses (including interest expense) generated arerecorded into the current profits and losses. However, for the financial liabilities designated by the Company to bemeasured at fair value and whose changes are included in the profits and losses of the current period, the amount ofchanges in the fair value of the financial liabilities caused by changes in its own credit risk is included in othercomprehensive income, at the termination of recognition of the financial liabilities, the accumulated gains and lossespreviously included in other comprehensive income shall be transferred from other comprehensive income andincluded in retained earnings.
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② Loan commitment and financial guarantee contract liabilities
A loan commitment is an undertaking provided by the Company to the customer to issue a loan to the customerwithin the commitment period on the terms of the established contract. The impairment loss of the loan commitmentis set down in accordance with the expected credit loss model.A financial guarantee contract is a contract that requires the Company to pay a specified amount of money to thecontract holder who suffers a loss when the particular debtor is unable to pay the debt in accordance with the originalor modified terms of the debt instrument at maturity. Financial guarantee contract liabilities shall be measured inaccordance with the impairment principle of financial instruments determined in accordance with the loss provisionand initial recognition of the amount of the balance of the accumulated amortization determined in accordance withthe income recognition principle.
③ Financial liabilities measured at amortized cost
After initial recognition, other financial liabilities are measured at amortized cost by using the effective interest ratemethod.
Except in special circumstances, financial liabilities and equity instruments are distinguished according to thefollowing principles:
① A contractual obligation meets the definition of a financial liability if the Company cannot unconditionally refrain
from performing it by paying cash or other financial assets. Although some financial instruments do not explicitlycontain terms and conditions for the obligation to deliver cash or other financial assets, it is possible to indirectlyform contractual obligations through other terms and conditions.
② If a financial instrument has to use or can use the Company's own equity instrument for settlement, consideration
needs to be given to whether the Company's own equity instrument used to settle the instrument is to be used as asubstitute for cash or other financial assets or to give the owner of the instrument a residual interest in the issuer'sassets after all liabilities have been deducted. In the former case, the instrument is a financial liability of the issuer;In the latter case, the instrument is an equity instrument of the issuer. In some cases, a financial instrument contractrequires that the Company has to use or can use its own equity instrument to settle the financial instrument, of whichthe amount of contractual rights or contractual obligations is equal to the number of its own equity instrumentsavailable or delivered multiplying its fair value at the settlement, no matter the amount of the contract rights orobligations are fixed or are based, in whole or in part, on changes in variables (such as interest rates, the price of acommodity or the price of a financial instrument) other than the market price of the Company’s own equityinstruments, the contract is classified as a financial liability.
(4) Derivative financial instruments and embedded derivative instruments
Derivative financial instruments are initially measured at the fair value of the date on which the derivativetransaction contract is signed, and are subsequently measured at their fair value. A derivative financial instrument
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with a positive fair value is recognized as an asset; and a derivative financial instrument with a negative fair valueis recognized as a liability.
Except the effective part of the hedge in the cash flow hedging is included in other comprehensive income andtransferred out into the current profit and loss when the hedged item affects the profit and loss, the profit or lossgenerated by the change of the fair value of the derivative instrument shall be directly included in the profits andlosses of the current period.
For hybrid instruments containing embedded derivatives, if the main contract is a financial asset, the hybridinstruments as a whole apply to the relevant provisions on the classification of financial assets. If the main contractis not a financial asset, and the hybrid instruments are not measured at fair value and the changes are recorded intothe current profits and losses for accounting treatment, the embedded derivatives have no close relationship withthe main contract in economic characteristics and risks, and the instrument with the same conditions as theembedded derivatives and existing alone satisfies the definition of derivatives, the embedded derivatives shall besplit from the hybrid instruments and handled as an individual derivative financial instrument. If the fair value ofthe embedded derivative on the acquisition date or on the subsequent balance sheet date cannot be measuredseparately, the hybrid instruments as a whole shall be designated as a financial asset or financial liability measuredat fair value and whose changes are recorded in the profits and losses of the current period.
(5) Impairment of financial instruments
For financial assets measured at amortized cost, debt investment measured at fair value and whose changes areincluded in other comprehensive income, contract assets, lease receivables, loan commitments and financialguarantee contract, the Company recognizes loss provisions on the basis of expected credit losses.
① Measurement of expected credit losses
Expected credit loss refers to the weighted average of the credit loss of a financial instrument weighted by the riskof default. Credit loss refers to the difference between all contractual cash flows receivable under the contract andall cash flows expected to be received by the Company discounted at the original effective interest rate, namely, thepresent value of all cash shortfalls. Among them, the financial assets purchased or generated by the Company whichhave credit impairment shall be discounted according to the credit adjusted effective interest rate of the financialassets.
The expected credit loss over the entire duration refers to the expected credit loss due to all possible default eventsthat may occur during the entire expected duration of a financial instrument.
Expected credit loss in the next 12 months refers to the expected credit loss resulting from the default event of afinancial instrument that may occur within 12 months after the balance sheet date (or the expected duration if theexpected duration of the financial instrument is less than 12 months), and is a part of the expected credit loss over
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the entire duration.
At each balance sheet date, the Company measures the expected credit losses of financial instruments at differentstages of development separately. If the credit risk of the financial instrument has not increased significantly sincethe initial recognition, it shall be in the first stage and the Company shall measure the loss provisions according tothe expected credit loss in the next 12 months; Where the credit risk of a financial instrument has increasedsignificantly since the initial recognition but no credit impairment has occurred, the financial instrument shall be inthe second stage, and the Company shall measure the loss provisions in accordance with the expected credit loss ofthe instrument throughout its lifetime; Where a financial instrument has suffered credit impairment since its initialrecognition, it shall be in the third stage, and the Company shall measure the loss provisions in accordance with theexpected credit loss for the entire duration of the instrument.
For financial instruments with low credit risk at the balance sheet date, the Company assumes that the credit riskhas not increased significantly since the initial recognition and measures the loss provisions in accordance with theexpected credit loss in the next 12 months.
The Company calculates the interest income for financial instruments in the first and second stages and with lowcredit risk on the basis of their book balance and the actual interest rate without deduction of impairment provision.For a financial instrument in the third stage, the interest income is calculated on the basis of the book balance minusthe amortized cost and the actual interest rate after the provision for impairment.
For notes receivable, accounts receivable, receivables financing and contractual assets, whether or not there is asignificant financing component, the Company measures loss provisions in accordance with the expected creditlosses over the entire duration.
A. Receivables/Contractual assetsFor notes receivable, accounts receivable, other receivables, receivables financing, contract assets and long-termreceivables that have objective evidence indicating the existence of impairment and are applicable to singleevaluation, implement impairment test separately, recognize expected credit losses, and set aside single impairmentreserves. For notes receivable, accounts receivable, other receivables, receivables financing, contractual assets andlong-term receivables that have objective evidence of impairment, or when the single financial assets cannot assessthe expected credit losses at reasonable costs, the Company divides notes receivable, accounts receivable, otherreceivables, receivables financing, contractual assets and long-term receivables into several portfolios based oncredit risk characteristics, and calculates the expected credit loss on the basis of the portfolios, and the portfolio isdetermined on the following basis:
The basis for determining the portfolio of notes receivable is as follows:
Notes receivable portfolio 1 Commercial acceptance bill
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Notes receivable portfolio 2 Bank’s acceptance bill
For notes receivable divided into portfolios, the Company calculates the expected credit loss by referring to thehistorical credit loss experience, combining the current situation and the forecast of future economic conditions, andthrough default risk exposure and the expected credit loss rate of the entire duration.The portfolio of accounts receivable is determined as follows:
Accounts receivable portfolio 1 Aging portfolioAccounts receivable portfolio 2 Jewelry sales portfolio
For accounts receivable divided into portfolio, the Company refers to the historical credit loss experience, combinesthe current situation and the forecast of the future economic situation, prepares a comparison table of the agingaccount receivable and the expected credit loss rate of the entire duration, and calculates the expected credit loss.The portfolio of other receivables is determined on the following basis:
Other receivables portfolio 1 Interest receivableOther receivables portfolio 2 Dividends receivableOther receivables portfolio 3 Aging portfolioOther receivables portfolio 4 Deposit receivable and cash deposit portfolioOther receivables portfolio 5 Related portfolio within the consolidation scope of receivables
For other receivables divided into portfolios, the Company calculates the expected credit loss by referring to thehistorical credit loss experience, combining the current situation and the forecast of future economic conditions, andthrough default risk exposure and the expected credit loss rate within the next 12 months and over the entire duration.
The basis for determining the portfolio of long-term receivables is as follows:
Long-term receivables portfolio 1 Other receivablesFor the long-term receivables divided into Portfolio 1, the Company calculates the expected credit loss by referringto the historical credit loss experience, combining the current situation and the forecast of future economicconditions, and through default risk exposure and the expected credit loss rate over the entire duration.
B. Bond investment and other bond investmentWith respect to bond investments and other bond investments, the Company calculates the expected credit losses inaccordance with the nature of the investment and the various types of counterparties and risk exposures and theexpected credit loss rates in the next 12 months or over the entire duration.
② Low credit risk
If a financial instrument has low credit risk, the the borrower has a strong ability to fulfill its contractual cash flowobligations in the short term, and even adverse changes in the economic situation and operating environment overa longer period may not necessarily reduce the borrower's ability to fulfill its contractual cash flow obligations, the
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financial instrument shall be regarded as a lower credit risk.
③ Credit risk increases significantly
The Company determines the relative changes in the probability of default over the expected duration of a financialinstrument and evaluates whether the credit risk of the financial instruments has increased significantly since theinitial recognition by comparing the probability of default over the expected duration of a financial instrument asdetermined at the balance sheet date and the probability of default over the expected duration as determined at thetime of initial recognition.
When determining whether the credit risk has increased significantly since the initial recognition, the Companyconsiders reasonable and evidence-based information, including forward-looking information, that is availablewithout unnecessary additional cost or effort. Information considered by the Company includes:
A. Whether the internal price index has changed significantly due to the change of credit risk;B. Adverse changes in business, finance or economic conditions that are expected to result in a significant changein the ability of the debtor to meet its debt service obligations;C. Whether there is an actual or expected significant change in the debtor's operating results; Whether there hasbeen a significant adverse change in the regulatory, economic or technological environment of the debtor;D. Whether there has been a significant change in the value of the collateral secured as collateralized debt obligationsor in the quality of the guarantees or credit enhancements provided by third parties. These changes are expected toreduce the economic incentive of the debtor to repay within the contractual period or affect the probability of default;E. Whether there are significant changes in the economic incentives that are expected to reduce the economicincentive of the debtor to repay within the contractual period;F. Expected changes in the loan contract include whether an anticipated breach of contract might result in exemptionor revision of contractual obligations, grant of interest free periods, jump in interest rates, request for additionalcollateral or guarantee, or other changes to the contractual framework of the financial instrument;G. Whether there is a significant change in the debtor's expected performance and repayment behavior;H. Whether the contract payment is overdue for more than (including) 30 days.Based on the nature of the financial instruments, the Company assesses whether the credit risk has increasedsignificantly on the basis of individual financial instruments or a portfolio of financial instruments. When assessingon the basis of a portfolio of financial instruments, the Company may classify the financial instruments based oncommon credit risk characteristics, such as overdue information and credit risk ratings.
Typically, if it is overdue for more than 30 days, the Company determines that the credit risk of financial instrumentshas increased significantly. Unless the Company does not need to pay too much cost or effort and can obtainreasonable and well-founded information, which demonstrates that although the payment is overdue for 30 days,the credit risk has not been significantly increased since the initial recognition.
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④Financial assets whose credit impairment has occurred
On the balance sheet date, the Company assesses whether credit impairment has occurred in the financial assetsmeasured at amortized cost and the debt investment measured at fair value and the changes of which are includedin other comprehensive income. When one or more events that have an adverse effect on the expected future cashflow of a financial asset occur, the financial asset becomes a financial asset whose credit impairment has occurred.Evidence indicating that a credit impairment has occurred on a financial asset includes the following observableinformation:
The creditor, for economic or contractual reasons relating to the debtor's financial difficulties, gives the debtorconcessions that would not have been made in any other circumstances; The issuer or the debtor has significantfinancial difficulties; The debtor breaches the contract, such as default or overdue payment of interest or principal;The creditor, for economic or contractual reasons relating to the debtor's financial difficulties, gives the debtorconcessions that would not have made in any other circumstances; The debtor is likely to go bankrupt or undergoother financial restructuring; The financial difficulties of the issuer or debtor lead to the disappearance of the activemarket for the financial asset; Purchase or originate a financial asset at a substantial discount that reflects the factthat a credit loss has occurred.
⑤ Presentation of provisions for expected credit losses
In order to reflect the change of the credit risk of financial instruments since the initial recognition, the Companyshall re-measure the expected credit loss on each balance sheet date, and the resulting increase or reversal amountof the loss provisions shall be recorded into the current profit and loss as impairment loss or gain. For a financialasset measured at amortized cost, the loss provision is offset against the carrying value of the financial asset asshown in the balance sheet; For a debt investment measured at fair value and whose changes are included in othercomprehensive income, the Company shall recognize its loss provision in other comprehensive income and shallnot offset the carrying value of the financial asset.
⑥ Write-off
If the Company no longer reasonably expects the contract cash flow of the financial asset to be recovered in wholeor in part, the book balance of the financial asset shall be written down directly. Such write-down constitutes thetermination of recognition of the underlying financial asset. This usually occurs when the Company determines thatthe debtor has no assets or sources of income which will generate sufficient cash flow to repay the amount to bewritten down.
If the write-down financial asset is recovered later, the impairment loss shall be reversed and included in the profitsand losses of the recovery period.
(6) Transfer of financial assets
Transfer of financial assets refers to the following two situations:
A. Transfer the contractual right to receive the cash flow of the financial asset to another party;
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B. Transfer the financial asset in whole or in part to another party, but retain the contractual right to receive the cashflow of the financial asset and the contractual obligation to pay the cash flow received to one or more payees.
①Terminate the recognition of transferred financial assets
Where almost all risks and rewards of ownership of a financial asset have been transferred to the transferee, oralmost all risks and rewards of ownership of a financial asset have been neither transferred nor retained, but thecontrol over the financial asset has been relinquished, recognition of the financial asset shall be terminated.When judging whether the control of the transferred financial asset has been given up, based on the actual ability ofthe transferee to sell the financial asset, if the transferee can unilaterally sell the transferred financial asset as a wholeto an unrelated third party with no additional conditions restricting such sale, it means that the Company has givenup its control over the financial asset.
The Company pays attention to the essence of financial asset transfer when judging whether the transfer of financialassets meets the conditions for the termination of recognition of financial asset.Where the overall transfer of financial assets meets the conditions for termination of recognition, the differencebetween the following two amounts shall be recorded into the profits and losses of the current period:
A. Book value of the transferred financial assets;B.The sum of the consideration received due to the transfer and the amount for the termination of recognition partin the cumulative amount of changes in fair value directly included in other comprehensive income (The financialassets involved in transfer are financial assets that are measured at fair value and their changes are included in othercomprehensive income according to Article 18 of Accounting Standards for Business Enterprises No. 22 -Recognition and Measurement of Financial Instruments).
When the partial transfer of a financial asset meets the criteria for recognition of termination, the entire book valueof the transferred financial asset shall be apportioned between the portion whose recognition is terminated and theportion whose recognition is not terminated (in this case, the reserved service assets shall be regarded as a part ofthe financial assets continued to be recognized) in accordance with the respective relative fair value on the transferday, and the balance between the following two amounts shall be recorded into the profits and losses of the currentperiod :
A. Book value of the the portion whose recognition is terminated on the date of termination of recognition;B. The sum of the consideration of the portion whose recognition has been terminated and the amount for thetermination of recognition part in the cumulative amount of changes in fair value directly included in othercomprehensive income (The financial assets involved in transfer are financial assets that are measured at fair valueand their changes are included in other comprehensive income according to Article 18 of Accounting Standards forBusiness Enterprises No. 22 - Recognition and Measurement of Financial Instruments).
② Continued involvement in the transferred financial assets
Where almost all the risks and rewards of ownership of the financial asset are neither transferred nor retained,
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control over the financial asset has not been relinquished, the relevant financial asset shall be recognized inaccordance with the extent of its continued involvement in the transferred financial asset and the relevant liabilitiesshall be recognized accordingly.
The extent of continued involvement in the transferred financial assets refers to the extent to which the enterprisebears the risk or reward of changes in the value of the transferred financial assets.
③ Continue to recognize the transferred financial assets
Where almost all the risks and rewards of the ownership of the transferred financial asset are still retained, thetransferred financial asset as a whole shall continue to be recognized and the consideration received shall berecognized as a financial liability.The financial assets and the relevant financial liabilities recognized shall not offset each other. In the subsequentaccounting period, the enterprise shall continue to recognize the income (or gain) generated by the financial assetand the expense (or loss) generated by the financial liability.
(7) Offset of financial assets and financial liabilities
Financial assets and financial liabilities shall be shown separately in the balance sheet and should not be set offagainst each other. However, if the following conditions are met at the same time, the net amount after mutual offsetshall be presented in the balance sheet:
The Company has the legal right to offset the recognized amount, and such legal right is currently enforceable;The Company plans a net settlement, or cashes the financial asset and liquidates the financial liability at the sametime.If the transfer of financial assets does not meet the conditions for termination of recognition, the transferring partyshall not offset the transferred financial assets and related liabilities.
11. Inventory
(1)Classification
Inventory includes finished products or commodities held for sale in daily activities, products in the productionprocess, materials and supplies consumed in the production process or the process of providing labor services, etc.,including raw materials, inventory goods, goods sold on consignment and working capital materials.
(2)Valuation methods for delivery of inventory
The delivery of inventory shall be priced individually on a first-in, first-out basis.
(3) Inventory system
Inventory of the Company is inventoried on a perpetual basis. And the inventory is taken at least once a year and
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amount of gains/losses is recognized in gains/losses for the year.
(4) How to set aside the inventory write down
On the balance sheet date, it shall be measured at the lower of cost and net realizable value. If the inventory cost ishigher than the net realizable value, set aside the inventory write down and record it into the profit and loss of thecurrent period.
The net realizable value of the inventory shall be determined on the basis of reliable evidence obtained, and factorssuch as the purpose for which the inventory is held and the impact of events after the balance sheet date shall betaken into account.
① The net realizable value of the inventory directly used for sale, such as finished products, commodities and
materials for sale, shall be determined in the normal process of production and operation by deducting the estimatedselling cost and relevant taxes from the estimated selling price of the inventory. For inventories held for theexecution of sales contracts or service contracts, the contract price shall be used as the measurement basis for thenet realizable value; If the quantity of inventory held exceeds the quantity ordered under the sales contract, the netrealizable value of the excess inventory shall be measured on the basis of the general sales price. The market priceshall be used as the measurement basis for the net realizable value of the materials for sale, etc.
② The net realizable value of the inventory of materials to be processed is determined by the amount after deducting
the estimated cost, estimated selling expenses and relevant taxes and fees at the time of completion from theestimated selling price of the finished products. If the net realizable value of the finished product produced by it ishigher than the cost, the material shall be measured at cost; If the decline in the price of a material indicates that thenet realizable value of the finished product is less than the cost, the material is measured at the net realizable valueand inventory write down is set aside based on the difference.
③ The reserve for inventory write down is generally set aside as a single inventory item. For the inventory with
large quantity and low unit price, it shall be set aside by inventory type.
④ On the balance sheet date, if the influencing factors of the previous write-down of the inventory value have
disappeared, the write-down amount shall be restored, and the amount shall be reversed within the original amountof the inventory write down, and the reversed amount shall be recorded into the profits and losses of the currentperiod.
12. Contract assets
The Company lists contractual assets or contract liabilities in the balance sheet based on the relationship betweenperformance obligations and customer payments. The consideration to which the Company is entitled to receive for
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the goods or services it has transferred to the customer (and the right depends on factors other than the passage oftime) is listed as contract assets. The company's obligations to transfer goods or provide services to customers forwhich consideration has been received or receivable are listed as contract liabilities.The Company's determination method and accounting treatment method on expected credit loss of contract assetsare detailed in Notes Ⅳ. 10.Contract assets and contract liabilities shall be listed separately in the balance sheet. The contract assets and contractliabilities under the same contract are listed as net amount. If the net amount is the debit balance, it shall be listedunder the item "Contract Assets" or "Other Non-current Assets" according to its liquidity; If the net amount is thenet credit balance, it shall be listed under the "Contract Liabilities" or "Other Non-current liabilities" according toits liquidity. Contract assets and contract liabilities under different contracts cannot offset each other.
13. Contract cost
Contract cost is divided into contract performance cost and contract acquisition cost.The cost incurred by the Company for the performance of the contract is recognized as an asset as the performancecost of the contract when the following conditions are met simultaneously:
① The cost is directly related to a current or expected contract, including direct labor, direct materials,
manufacturing expenses (or similar expenses), costs expressly borne by the customer and other costs incurred solelyas a result of the contract.
② This cost increases the Company's resources for future performance obligations.
③ The cost is expected to be recouped.
If the incremental cost incurred by the Company to acquire the contract is expected to be recovered, it shall berecognized as an asset as the contract acquisition cost.
Assets related to contract costs are amortized on the same basis as revenue recognition for the goods or servicesrelated to the assets, however, if the amortization period of the contract acquisition cost does not exceed one year,the Company will record it into the current profit and loss when it occurs.
If the carrying value of the assets related to the contract cost is higher than the difference between the following twoitems, the Company will set aside impairment reserves of the excess part and recognize it as impairment loss of theasset, and further consider whether to set aside provision for the expected liabilities related to the loss contract:
① The remaining consideration expected to be obtained from the transfer of goods or services related to the asset;
② Cost estimated to be incur for transferring the related goods or services.
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If the aforesaid asset impairment provision is subsequently reversed, the carrying value of the asset after the reversalshall not exceed the carrying value of the asset on the reversal date under the assumption that no impairmentprovision is made.
Contract performance costs recognized as assets whose amortization period at the initial recognition does not exceedone year or one normal operating cycle shall be listed in the item "Inventory", and those whose amortization periodat the initial recognition exceed one year or one normal operating cycle shall be listed in the item "Other Non-current Assets".
Contract acquisition costs recognized as assets whose amortization period at the initial recognition does not exceedone year or one normal operating cycle shall be listed in the item "Other Current Assets", and those whoseamortization period at the initial recognition exceeds one year or one normal operating cycle shall be listed in theitem "Other Non-current Assets".
14.Assets held-for-sale
(1)Classification of non-current assets or disposal groups held for sale
The Company classifies non-current assets or disposal groups that meet all of the following conditions as held-for-sale:
①according to the practice of selling this type of assets or disposal groups in a similar transaction, the non-current
assets or disposal group can be sold immediately at its current condition;
②The sale is likely to occur, that is, the Company has made resolution on the selling plan and obtained definite
purchase commitment, the selling is estimated to be completed within one year. Those assets whose disposal issubject to approval from relevant authority or supervisory department under relevant requirements are subject tothat approval.
The non-current assets or disposal group acquired by the company specifically for resale shall be classified as heldfor sale on the date of acquisition if meets the condition of “expected to complete the sale within one year” on theacquisition date, and is likely to meet other classification conditions of held for sale in the short term (usually 3months) .
Where the Company loses control over its subsidiary due to disposal of investment in the subsidiary, whether or notthe Company retains part equity investment after such disposal, investment in the subsidiary shall be classified inits entirety as held for sale in the separate financial statement of the parent company subject to that the investmentin the subsidiary proposed to be disposed satisfies the conditions for being classified as held for sale, and all theassets and liabilities of the subsidiary shall be classified as held for sale in consolidated financial statement.
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(2) Measurement of non-current assets held for sale or disposal group
The investment real estate by using fair value model for subsequent measurement, the biological assets measuredat net amount after fair value minus sale cost, the assets formed by employee compensation, the deferred incometax assets, the financial assets specified by related accounting standards of financial instruments and themeasurements of the rights generated by the insurance contract specified by related accounting standards ofinsurance contract respectively apply to other related accounting standards.
When initially measuring or remeasuring the non-current assets held for sale or disposal group on the balance sheetdate, if its book value is higher than the net amount after the fair value minus the sale cost, book value will bewritten down to the net amount after the fair value minus the sale cost, the write-down amount shall be recognizedas asset impairment loss and included in the current profits and losses, and the impairment reserves held for saleshall be set aside at the same time. On the subsequent balance sheet date, if the net amount of the fair value of thenon-current assets or disposal group held for sale increases after subtracting the selling expenses, the previouslywritten-down amount shall be recovered and reversed within the amount of the asset impairment losses recognizedas non-current assets after being classified as held for sale, and the reversed amount is included in the current profitsand losses. The carrying amount of goodwill that has been offset is not recovered.
When non-current assets or disposal groups no longer continue to be classified as held for sale as they no longermeet the classification conditions of the held for sale category or non-current assets are removed from the held forsale disposal group, measure based on the lower of the following two:
①Book value before being classified as held for sale, the amount adjusted according to the depreciation,
amortization, or impairment that should have been recognized under the assumption that it is not classified as heldfor sale;
②Recoverable amount.
(3) Presentation
In the balance sheet, the Company lists non-current assets held for sale or assets in the disposal group held for saleseparately from other assets, and lists liabilities in the disposal group held for sale separately from other liabilities.Non-current assets held for sale or assets in the disposal group held for sale and liabilities in the disposal group heldfor sale do not offset each other and are listed as current assets and current liabilities respectively.
15. Long-term equity investment
The long-term equity investment of the Company includes the equity investment which controls and has a significantimpact on the investee and the equity investment in the joint venture. If the Company is able to exert significantinfluence on the invested entity, it shall be an associate enterprise of the Company.
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(1) Basis for determining the joint control and significant impact on the investee
Joint control refers to the common control of an arrangement according to relevant agreements, and relevantactivities of the arrangement must be agreed upon by all the participants who share the control right. When judgingwhether there is joint control, first judge whether all participants or participant portfolios collectively control thearrangement. If all participants or a group of participants must act in concert to determine the relevant activities ofan arrangement, then all participants or a group of participants are considered to collectively control the arrangement.Secondly, it will judge whether the decision of the activities related to the arrangement must be agreed by theparticipants who collectively control the arrangement. If two or more participant portfolios can collectively controlan arrangement, it does not constitute joint control. The existence of joint control is judged without regard to theprotective rights enjoyed.
Significant impact means that the investor has the right to participate in the decision-making of the financial andoperational policies of the investee, but cannot control or jointly control the formulation of these policies with otherparties. When determining whether it can exert a significant impact on the investee, it shall consider the impact ofthe voting shares directly or indirectly held by the investor and the potential voting rights of the investor and otherparties in the current period assumed to be converted into the equity of the investee, including the impact of currentconvertible warrants, stock options and convertible corporate bonds issued by the investee.
When the Company owns more than 20% (including 20%) but less than 50% of the voting shares of the investeedirectly or indirectly through its subsidiaries, it is generally considered to have a significant impact on the investee,unless there is clear evidence that it cannot participate in the production and operation decisions of the investeeunder such circumstances, it shall not have a significant impact.
(2) Recognition of initial investment cost
●Investment cost of the long-term equity investment resulting from enterprise combination is recognized in
accordance with the following provisions:
A. In the case of a business combination under the same control, if the combining party pays cash, transfers non-cash assets or assumes debts as the merger consideration, the share of the book value of the acquired owner’s equityof the combined party in the consolidated financial statements of the ultimate controlling party shall be used as itsinitial investment cost. The difference between the initial investment cost of long-term equity investment and thecarrying amount of cash paid, non-cash assets transferred and liabilities assumed is adjusted to capital reserves; ifthe capital reserves is not sufficient to offset the difference, retained earnings is adjusted.
B. For a business combination under the same control, where the merging party issues equity securities as the mergerconsideration, the initial investment cost of the long-term equity investment shall be the share of the book value ofthe owner's equity of the merged party in the consolidated financial statements of the final controlling party on themerger date. The capital reserves shall be adjusted according to the difference between the initial investment costof a long-term equity investment and the total par value of the issued shares; if the capital reserves are insufficient
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to offset, the retained earnings shall be adjusted;C. For a business combination not under the same control, the fair value of the assets paid, liabilities incurred orassumed and equity securities issued on the purchase date in order to acquire the control of the acquiree determinesthe merger cost as the initial investment cost of long-term equity investment. The intermediary fees for auditing,legal services, evaluation and consultation and other related administrative expenses incurred by the merger partyshall be recorded into the profits and losses of the current period when incurred.
●Except for the long-term equity investment formed by enterprise merger, the investment cost of the long-term
equity investment obtained by other means shall be determined in accordance with the following provisions:
A. For long-term equity investment acquired by paying cash, the actual purchase price paid is regarded as theinvestment cost. Initial investment cost includes expenses, taxes and other necessary expenses directly related to theacquisition of long-term equity investment.
B. For long-term equity investment acquired by issuing equity securities, the fair value of issuing equity securitiesis regarded as the investment initial investment cost.
C. For long-term equity investment acquired by the exchange of non-monetary assets,if the exchange is of a commercial nature and the fair value of the assets received or surrendered can be reliablymeasured, the fair value of the assets surrendered and the relevant taxes and fees shall be taken as the initialinvestment cost, and the difference between the fair value and the book value of the assets surrendered shall beincluded in the current profits and losses. If the exchange of non-monetary assets does not meet the above twoconditions at the same time, the book value of the assets surrendered and relevant taxes and fees shall be taken asthe initial investment cost.
D. For long-term equity investment acquired through debt restructuring, its entry value shall be determined by thefair value of the abandoned creditor's rights and the taxes and other costs directly attributable to the asset, and thedifference between the fair value of the abandoned creditor's rights and the carrying value shall be recorded into thecurrent profits and losses.
(3) Methods of subsequent measurement and profit and loss recognition
The long-term equity investment that the Company can control over the invested unit shall use cost method forbusiness accounting; Long-term equity investments in joint ventures and cooperative enterprises shall use equitymethod for business accounting.
① Cost method
For the long-term equity investment uses cost method for business accounting, the cost of the long-term equityinvestment shall be adjusted when the investment is added or recovered; Cash dividends or profits declared to bedistributed by the invested entity shall be recognized as current investment income.
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② Equity method
The general accounting treatment for long-term equity investments using equity method for business accounting isas follows:
If the investment cost of the Company's long-term equity investment is greater than the fair value share of theidentifiable net assets of the invested entity, the initial investment cost of the long-term equity investment shall notbe adjusted; If the initial investment cost of the long-term equity investment is less than the fair value share of theidentifiable net assets of the invested entity at the time of investment, the difference shall be recorded into the currentprofits and losses, and the cost of the long-term equity investment shall be adjusted at the same time.
The Company recognizes investment income and other comprehensive income respectively according to the shareof net profit and loss realized by the invested entity and other comprehensive income which the Company shallenjoy or share, and adjusts the book value of long-term equity investment at the same time; The Company calculatesits share based on the profits or cash dividends declared and distributed by the invested entity and reduce the bookvalue of the long-term equity investment accordingly; The book value of the long-term equity investment shall beadjusted based on other changes in the owner's equity other than the net profit or loss, other comprehensive incomeand profit distribution of the invested entity, and recorded into the owner's equity. When recognizing the share ofthe net profit or loss of the invested entity, the fair value of the identifiable net assets of the invested entity at thetime of acquiring the investment shall be taken as the basis, and the net profit of the invested entity shall berecognized after adjustment. If the accounting policies and accounting periods adopted by the invested entity areinconsistent with those of the Company, the financial statements of the invested entity shall be adjusted inaccordance with the accounting policies and accounting periods of the Company, and the investment income andother comprehensive income shall be recognized on the basis thereof. The part of profit and loss of the unrealizedinternal transactions between the Company and the associated enterprises and joint ventures which is attributable tothe Company by calculating according to the proportion enjoyed shall be set off, and the investment profit and lossshall be recognized on this basis. If the loss of unrealized internal transaction between the Company and the investedentity belongs to impairment loss of assets, it shall be recognized in full.
If the company is able to exert significant influence or implement joint control on the investee due to additionalinvestment and other reasons, which does not constitute control, the fair value of the original equity investment plusthe new investment cost shall be taken as the initial investment cost according to the equity method. If the previouslyheld equity investment is classified as other equity instrument investment, the difference between its fair value andbook value, as well as the accumulated gains or losses originally included in other comprehensive income shall betransferred from other comprehensive income and included in retained earnings in the current period when changingto use equity method for accounting.
Where the joint control or significant influence on the invested unit is lost due to the disposal of some equity
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investments, the remaining equity after disposal shall be measured by the fair value, and the difference between thefair value and the book value on the date of the loss of joint control or significant influence shall be recorded intothe current profits and losses. Other comprehensive income of the original equity investment recognized by usingthe equity method for accounting adopts the same basis as the direct disposal of related assets or liabilities by theinvested entity for accounting treatment when the equity method is discontinued.
(4) Equity investments held for sale
Where the equity investment of a joint venture or associated enterprise is classified in whole or in part as assets heldfor sale, see Notes III. 15 for relevant accounting treatment.
For the remaining equity investment not classified as assets held for sale, the equity method is used for accountingtreatment.
If an equity investment in a joint venture or associated enterprise that has been classified as assets held for sale nolonger meets the classification conditions for assets held for sale, it shall be retroactively adjusted by using theequity method from the date when it is classified as assets held for sale. The financial statements for the periodclassified as held for sale are adjusted accordingly.
(5) Impairment test method and impairment reserve calculation method
For the investment of a subsidiary, associated enterprise or joint venture, see Notes Ⅳ. 21 for the method of settingaside the impairment of assets.
16. Investment real estate
(1) Category of investment real estate
The investment real estate is the real estate that held to earn rents or for capital appreciation, or both. Mainlyincludes:
①Leased land use rights.
②Land use rights held and ready to be transferred after appreciation.
③Leased buildings
(2) Measurement of investment real estate
The Company adopts the cost model to carry out follow-up measurement of investment real estate, see Note Ⅳ. 21for the method of setting aside the impairment of assets.After deducting the accumulated impairment and net residual value of the investment real estate cost, the Companycalculates the depreciation or amortization by the straight-line method. The categories of the investment real estate,the estimated economic useful life and the estimated net residual value rate determine the depreciation life and theannual depreciation rate as follows:
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Category
Years ofdepreciation(
Scrap value rate(%) Yearly depreciation rate(%)
| year) | |
| House and buildings |
35-40 3 2.77-2.43
50 — 2.00
17. Fixed assets
(1) Recognition
Fixed assets are recognized at their actual cost at the time of acquisition when both of the following conditions aremet:
①the economic benefits associated with the fixed assets are likely to flow into the enterprise.
②cost of the fixed assets can be measured reliably.
If the subsequent expenditure incurred for fixed assets that meet the conditions for recognition of fixed assets areincluded in the costs of fixed assets; those that qualify for recognition as fixed assets are recognized in currentgain/loss.
(2) Depreciation methods
Category MethodYears of depreciation Salvage rates
Annual depreciation
ratesHouse and buildings
Straight-line
Land use right
depreciation
10, 35-40 0、3 2.43-2.77, 10.00
| depreciation | |
| Including: owned |
house renovation
10 0 10Machinery equipment
| Straight-line depreciation |
| Straight-line depreciation |
12 3 8.08Transport equipment
7 3 13.86Electronic equipment
Straight-line
| Straight-line depreciation |
| depreciation |
5-7 3 13.86-19.40
| Office and other equipment | Straight-line depreciation |
7 3 13.86
(3) Recognition, measurement and depreciation of fixed assets held under finance lease
18. Construction in progress
(1) Business accounting of the construction work in process in based on project classification.
(2) Standard and time point for carrying forward the construction work in process into fixed assets
For the construction work in process project, the book value of the fixed asset is all the expenses incurred beforethe construction of the asset reaches the predetermined serviceable state. Including construction costs, the original
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price of machinery and equipment, other necessary expenses incurred to make the construction work in processreach the predetermined serviceable state, as well as the borrowing costs incurred for the special borrowing of theproject before the assets reach the predetermined serviceable state and the borrowing costs incurred for the occupiedgeneral borrowing. The Company transfers the construction work in process into fixed assets when the projectinstallation or construction is completed and reaches the predetermined serviceable state. The constructed fixedassets which have reached the predetermined serviceable state but have not yet completed the final account shall betransferred to the fixed assets based on the estimated value according to the construction budget, cost or actual costof work performed from the date of reaching the predetermined serviceable state, and calculates the depreciation offixed assets in accordance with the Company's policy for depreciation of fixed assets, and the original provisionalestimated value shall be adjusted according to the actual cost after the completion of the final account, but thepreviously accrued amount of depreciation shall not be adjusted.
19. Borrowing expenses
(1) The recognition principle of capitalization of borrowing costs and capitalization period
The borrowing expenses incurred by the Company which can be directly attributed to the acquisition andconstruction or production of assets that meet the capitalization conditions shall be capitalized and included into therelated asset costs when the following conditions are met simultaneously:
① Asset expenditure has incurred;
② Borrowing costs have incurred;
③The necessary acquisition and construction or production activities have begun to make the assets reach the
predetermined serviceable state.Other interest on borrowings, discounts or premiums and exchange gains or losses shall be included in the profitsor losses of the current period.If abnormal interruption occurs in the process of acquisition, construction or production of the assets eligible forcapitalization, and the interruption period exceeds 3 consecutive months, the capitalization of borrowing costs shallbe suspended.The capitalization of the borrowing costs shall be stopped when the assets that meet the capitalization conditions ofthe acquisition, construction or production reach the predetermined serviceable or marketable status; Borrowingcosts incurred later are recognized as expenses in the current period of occurrence.
(2)The capitalization rate of borrowing costs and the calculation method of capitalization amount
Where specific borrowings are borrowed for the acquisition and construction or production of assets eligible for
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capitalization, the amount after deducting the interest income obtained by depositing the unused loan funds in thebank or the investment income obtained through temporary investment from the interest expenses actually incurredin the current period of the specific borrowings is determined as the amount of the capitalization of the interestcharges for specific borrowings.
Where general borrowings are occupied for the acquisition and construction or production of assets eligible forcapitalization, the amount of interest that should be capitalized on the general borrowings shall be calculated anddetermined by multiplying the asset expenditure weighted average of the accumulated asset expenditure exceedingthe specific borrowings and the capitalization rate of the general borrowings. The capitalization rate is calculatedand determined based on the weighted average interest rate of general borrowings.
20. Intangible assets
(1) Valuation method, useful life and impairment testing
(1) Valuation of intangible assets
Recorded at the actual cost at the time of acquisition.
(2) Useful life and amortization of intangible assets
①Estimated useful life of the intangible assets with finite useful life:
Item Estimated useful life Basis
50 years Legal right of use
| Land use right |
| Computer software |
5 years
| Useful life is determined by the reference to the period that can bring economic benefit to the Company | ||
| Trademark |
10 years
At the end of each year, the company shall review the service life and amortization method of intangible assets withlimited service life. Upon review, the service life and amortization method of intangible assets at the end of thisperiod are not different from previous estimates.
② Intangible assets that cannot be foreseen to bring economic benefits to the enterprise shall be regarded as
intangible assets with uncertain service life. For intangible assets with uncertain service life, the company shallreview the service life of the intangible assets with uncertain service life at the end of each year. If the service lifeof the intangible assets is still uncertain after the review, an impairment test shall be conducted on the balance sheetdate.
③Amortization of intangible assets
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For intangible assets with limited service life, the Company shall determine their service life at the time ofacquisition, and make reasonable amortization within the service life by using the straight line method system, andthe amortization amount shall be recorded into the current profits and losses according to the benefit items. Thespecific amount to be amortized is the amount after deducting the estimated residual value from the cost. Forintangible assets for which impairment reserves have been set aside, the accumulated amount of impairment reservesfor intangible assets which have been set aside shall also be deducted. For intangible assets with limited service life,its residual value shall be regarded as zero, except in the following cases: a third party promises to purchase theintangible asset at the end of its service life, or the estimated residual value information can be obtained based onthe active market, and such market is likely to exist at the end of the service life of the intangible asset.
Intangible assets with uncertain service life shall not be amortized. At the end of each year, the service life ofintangible assets with uncertain service life shall be reviewed. If there is evidence that the service life of intangibleassets is limited, the service life of intangible assets shall be estimated and reasonably amortized in a system withinthe expected service life.
(3)Long-term assets impairment
The asset impairment of the long-term equity investment of subsidiary companies, associated enterprises and jointventures, the investment real estate using cost model for subsequent measurement, the fixed assets, the constructionwork in process, the intangible assets, the goodwill, etc. (except for inventory, investment real estate measured byfair value model, deferred income tax assets, financial assets) is determined according to the following methods:
On the balance sheet date, the Company judges whether there are any signs of possible impairment of the assets. Ifthere are any signs of impairment, the Company will estimate the recoverable amount and conduct an impairmenttest. For goodwill formed by business combination, intangible assets with uncertain service life and intangible assetsthat have not reached the usable state, impairment test is carried out every year, regardless of whether there is anyindication of impairment.The recoverable amount is determined according to the higher between the net amount of the fair value of the assetminus the disposal expense and the present value of the expected future cash flow of the asset. The Companyestimates the recoverable amount on the basis of individual assets; If it is difficult to estimate the recoverable amountof a single asset, the recoverable amount of an asset group shall be determined on the basis of the asset group towhich the asset belongs. The identification of an asset group shall be based on whether the main cash inflowgenerated by the asset group is independent of the cash inflow of other assets or asset group.When the recoverable amount of an asset or an asset group is lower than its carrying amount, the Company willwrite down the carrying amount to the recoverable amount, record the write-down amount into the current profitsand losses, and at the same time make a provision for the corresponding asset impairment.
For the impairment test of goodwill, the book value of the goodwill formed by the business combination shall beapportioned to the relevant asset group in a reasonable manner from the purchase date; If it is difficult to be
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apportioned to the relevant asset group, it shall be apportioned to the relevant asset group portfolio. The related assetgroup or asset group portfolio is the asset group or asset group portfolio that can benefit from the synergies ofbusiness combination and is not greater than the reporting segment identified by the Company.
During the impairment test, if the asset group or asset group portfolio related to goodwill shows signs of impairment,the impairment test shall be carried out on the asset group or asset group portfolio which does not contain goodwill,the recoverable amount shall be calculated and the corresponding impairment loss shall be confirmed. Then theimpairment test is carried out on the asset group or the asset group portfolio containing goodwill, comparing itsbook value with the recoverable amount, if the recoverable amount is lower than the book value, the impairmentloss of goodwill is confirmed.
Once an asset impairment loss is recognized, it shall not be reversed in the subsequent accounting period.
(2) Accounting policy for internal R&D expenditures
21. Long-term assets impairment
The asset impairment of the long-term equity investment of subsidiary companies, associated enterprises and jointventures, the investment real estate using cost model for subsequent measurement, the fixed assets, the constructionwork in process, the intangible assets, the goodwill, etc. (except for inventory, investment real estate measured byfair value model, deferred income tax assets, financial assets) is determined according to the following methods:
On the balance sheet date, the Company judges whether there are any signs of possible impairment of the assets. Ifthere are any signs of impairment, the Company will estimate the recoverable amount and conduct an impairmenttest. For goodwill formed by business combination, intangible assets with uncertain service life and intangible assetsthat have not reached the usable state, impairment test is carried out every year, regardless of whether there is anyindication of impairment.The recoverable amount is determined according to the higher between the net amount of the fair value of the assetminus the disposal expense and the present value of the expected future cash flow of the asset. The Companyestimates the recoverable amount on the basis of individual assets; If it is difficult to estimate the recoverable amountof a single asset, the recoverable amount of an asset group shall be determined on the basis of the asset group towhich the asset belongs. The identification of an asset group shall be based on whether the main cash inflowgenerated by the asset group is independent of the cash inflow of other assets or asset group.When the recoverable amount of an asset or an asset group is lower than its carrying amount, the Company willwrite down the carrying amount to the recoverable amount, record the write-down amount into the current profitsand losses, and at the same time make a provision for the corresponding asset impairment.
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For the impairment test of goodwill, the book value of the goodwill formed by the business combination shall beapportioned to the relevant asset group in a reasonable manner from the purchase date; If it is difficult to beapportioned to the relevant asset group, it shall be apportioned to the relevant asset group portfolio. The related assetgroup or asset group portfolio is the asset group or asset group portfolio that can benefit from the synergies ofbusiness combination and is not greater than the reporting segment identified by the Company.
During the impairment test, if the asset group or asset group portfolio related to goodwill shows signs of impairment,the impairment test shall be carried out on the asset group or asset group portfolio which does not contain goodwill,the recoverable amount shall be calculated and the corresponding impairment loss shall be confirmed. Then theimpairment test is carried out on the asset group or the asset group portfolio containing goodwill, comparing itsbook value with the recoverable amount, if the recoverable amount is lower than the book value, the impairmentloss of goodwill is confirmed.
Once an asset impairment loss is recognized, it shall not be reversed in the subsequent accounting period.
22.Long-term prepaid expenses
To account for the expenses that have been incurred but which shall be borne by the current and future periodsand which are apportioned over a period of more than one year.The long-term prepaid expenses will amortized equally over the period of benefit.
23. Employee remuneration
(1) Accounting treatment of short-term remuneration
① Basic remuneration (salary, bonus, allowance, subsidy)
During the accounting period when the employees provide services to the Company, the Company recognizes theshort-term remuneration actually incurred as a liability and records it into the current profits and losses, except forthose required or allowed to be included in the cost of assets under other accounting standards.
② Employee welfare expenses
The employee welfare expenses incurred by the Company shall be included in the current profits and losses orrelated asset costs according to the actual amount incurred when they actually occur. If employee welfare expensesare non-monetary welfare, they shall be measured at fair value.
③Medical insurance, industrial injury insurance, maternity insurance and other social insurance premiums and
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housing provident funds, as well as labor union funds and staff education fundsThe medical insurance, industrial injury insurance, maternity insurance and other social insurance premiums andhousing provident funds the Company paid for its employees, as well as the labor union funds and staff educationfunds set aside by rule calculate and determine the corresponding employee remuneration amount according to thestipulated provisions basic and provision ratio during the accounting period for the employee to provide services,and confirm the corresponding liabilities and record them into the current profits and losses or related asset cost.
④Short-term paid absence
The Company recognizes the employee's compensation related to the accumulated paid absence when the serviceprovided by the employee increases his or her right to enjoy future paid absence, and measures it with the increasein expected payment due to the accumulated unexercised right. The Company recognizes employee compensationrelated to non-cumulative paid absence during the accounting period when the absence actually occurs.
⑤ Short-term profit sharing plan
If the profit sharing plan satisfies the following conditions at the same time, the Company recognizes the relevantemployee compensation payable:
A. The enterprise has a statutory or constructive obligation to pay its employees due to past events;B. The amount of payroll obligations arising from profit sharing plans can be reliably estimated.
(2) Accounting treatment of post-employment benefits
① Defined contribution plans
The Company recognizes the amount payable calculated according to the defined contribution plans as a liabilityduring the accounting period when the employee provides services to it, and records it into the current profits andlosses or the related asset cost.According to the defined contribution plans, where it is not expected to pay the full amount payable within 12months after the end of the annual reporting period for the relevant services provided by the employee, the Companymeasures the payroll payable by the amount after discounting the full amount payable with reference to thecorresponding discount rate (determined by the treasury bonds matching with the obligatory term of definedcontribution plans or the market yield of the high quality corporate bonds in the active market at the balance sheetdate).
② Defined benefit plans
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A. Determine the present value and current service cost of the obligations under the defined benefit plansAccording to the expected accumulative welfare unit method, the relevant demographic variables and financialvariables are estimated by using unbiased and consistent actuarial assumptions, the obligations arising from thedefined benefit plans are measured, and the period of attribution of the relevant obligations is determined. TheCompany discounts the obligations arising from the defined benefit plans according to the corresponding discountrate (determined by the treasury bonds matching with the obligatory term of defined benefit plans or the marketyield of the high quality corporate bonds in the active market at the balance sheet date) to determine the presentvalue of the obligations of the defined benefit plans and the current service cost.B. Recognize the net liabilities or net assets of the defined benefit plansWhere there are assets in the defined benefit plans, the Company shall recognize the deficit or surplus formed bythe present value of the obligations of the defined benefit plans minus the fair value of the assets of the definedbenefit plans as the net liabilities or net assets of a defined benefit plan.If there is surplus in the defined benefit plans, the Company shall measure the net assets of the defined benefit plansby the lower of the defined benefit plans’ surplus or the upper limit of assets.C. Determine the amount to be included in the asset cost or the current profit and lossService cost includes current service cost, past service cost and settlement gains or losses. Among them, except forthe current service costs required or allowed to be included in the cost of assets under other accounting standards,other service costs are included in the current profits and losses.Net interest on net liabilities or net assets of defined benefit plans, including interest income on plan assets, interestexpense on defined benefit plan obligations, and interest on the impact of asset caps, are recorded in the currentprofits and losses.D. Determine the amount to be included in other comprehensive incomeRemeasurement of changes in net liabilities or net assets of a defined benefit plan, including:
(a) Actuarial gain or loss is an increase or decrease in the present value of the previously measured defined benefitplan obligations as a result of actuarial assumptions and empirical adjustments;(b) Return on plan assets, deduct the amount included in the net interest on the net liabilities or net assets of thedefined benefit plan;(c) Changes in the impact of the asset cap, deduct the amount included in the net interest on the net liabilities or netassets of the defined benefit plan.
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Changes in net liabilities or net assets of the above-mentioned remeasured benefit plan are directly included in othercomprehensive income and are not allowed to be transferred back to profit or loss in subsequent accounting periods,but the Company may transfer these amounts recognized in other comprehensive income within the range of equity.
(3) Accounting treatment of dismiss benefits
Where the Company provides dismiss benefits to its employees, the Company shall recognize the employees'compensation liabilities arising from dismiss benefits at the earlier day of the following two, and record them intothe current profits and losses:
①The enterprise cannot unilaterally withdraw the dismiss benefits provided by the plan for the termination of labor
relations or the downsizing proposal;
② When the enterprise recognizes the costs or expenses related to the restructuring involving the payment of dismiss
benefits.If the dismiss benefits are not expected to be fully paid within 12 months after the end of the annual report period,the amount of dismiss benefits shall be discounted according to the corresponding discount rate (determined by thetreasury bonds matching with the obligatory term of defined benefit plans or the market yield of the high qualitycorporate bonds in the active market at the balance sheet date), and the discounted amount shall be used to measurethe payroll payable.
(4) Other accounting treatment methods for long-term employee benefits
① Meeting the conditions of the defined benefit plan
If other long-term employee benefits provided by the Company meet the conditions of the defined benefit plan, thepayroll payable shall be measured at the discounted amount of the total amount payable.
② Meeting the conditions of the defined benefit plan
At the end of the reporting period, the Company recognizes the employee compensation costs generated by otherlong-term employee benefits as the following components:
A. Service cost;B. Net interest on net liabilities or net assets of other long-term employee benefits;C. Remeasurement of changes in net liabilities or net assets of other long-term employee benefits.In order to simplify the relevant accounting treatment, the total net amount of the above items is included in the
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current profits and losses or the related asset cost.
24. Accrual liability
(1) Recognition standards
The Company recognizes an accrual liability if the obligation associated with the contingency also meets thefollowing conditions:
①the obligation is a present obligation assumed by the Company;
②it is probable that the performance of the obligation will result in an outflow of the economic benefits to the
Company;
③the obligation can be measured reliably for its value.
(2) Measurement
Accrual liabilities are initially measured in accordance with the best estimate of the expenses required to fulfill therelevant current obligations, taking into account the risks, uncertainties and time value of money related tocontingencies. The book value of the Accrual liabilities is reviewed on each balance sheet date. If there is conclusiveevidence that the book value cannot reflect the current best estimate, the book value shall be adjusted according tothe current best estimate.
25. Revenue
Accounting policy of revenue recognition and measurement
(1) General principles
Income is the total inflow of economic benefits generated in the daily activities of the Company that will lead to anincrease in shareholders' equity and have nothing to do with the capital invested by shareholders.The Company recognizes revenue when the performance obligation in the contract has been fulfilled, that is, whenthe customer obtains the control of the relevant commodity. To gain control of a relevant commodity means to beable to dominate the use of the commodity and gain almost all economic benefits from it.If the contract contains two or more performance obligations, the Company shall, on the commencement date of thecontract, apportion the transaction price to each individual performance obligation in accordance with the relativeproportion of the individual selling price of the goods or services promised in each individual performanceobligation, and measure its income according to the transaction price apportioned to each individual performance
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obligation.The transaction price is the amount of consideration the Company expects to be entitled to receive in connectionwith the transfer of goods or services to the customer, excluding payments received on behalf of third parties. Whendetermining the contract transaction price, if there is a variable consideration, the Company determines the bestestimate of the variable consideration in terms of the expected or most likely amount, and includes the transactionprice in an amount not exceeding the cumulatively recognized income which is highly unlikely to be materiallyreversed when the relevant uncertainty is removed. If there is a significant financing component in the contract, theCompany will determine the transaction price on the basis of the amount payable paid in cash by the customer atthe time of acquisition of control of the goods, the difference between the transaction price and the contractconsideration is amortized over the period of the contract by using the effective interest method. Where the timebetween the transfer of control and the payment by the customer is less than one year, the Company shall notconsider the financing component.It belongs to fulfillment of performance obligations within a certain period of time if meeting one of the followingconditions; otherwise, it belongs to fulfillment of performance obligations at a certain point of time:
①The customer obtains and consumes the economic benefits brought by the performance of the Company when
performing the contract;
② The customer can control the goods under construction in the process of the company's performance;
③The products produced by the Company during the performance of the contract have irreplaceable uses, and the
Company has the right to collect payment for the accumulated part of the performance completed so far during theentire contract period.For performance obligations performed within a certain period of time, the Company shall recognize revenue inaccordance with the performance progress within that period, except where the performance progress cannot bereasonably determined. The Company determines the performance progress of the services provided according tothe input (or output) method. When the performance progress cannot be reasonably determined, if the cost alreadyincurred by the Company is expected to be compensated, the revenue shall be recognized according to the amountof cost already incurred until the performance progress can be reasonably determined.For performance obligations performed at a certain point of time, the Company recognizes revenue at the time pointwhen the customer obtains control of the relevant goods. When judging whether the customer has acquired controlof the goods or services, the Company will consider the following indications:
①The Company is entitled to current payment rights in respect of the goods or services, that is, the customer has
current payment obligations in respect of the goods;
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② The Company has transferred the legal ownership of the goods to the customer, that is, the customer has the legal
ownership of the goods;
③ The Company has transferred the commodity in kind to the customer, that is, the customer has physical
possession of the commodity;
④The Company has transferred the main risks and rewards of the ownership of the goods to the customer, that is,
the customer has acquired the main risks and rewards of the ownership of the goods;
⑤ The customer has accepted the goods.
Sales return clauseFor sales with a sales return clause, the Company shall recognize the revenue according to the amount ofconsideration to which the customer is entitled as a result of the transfer of the goods to the customer when thecustomer acquires the control of the relevant goods, and the amount refunded as expected due to the sales returnshall be recognized as an estimated liability. At the same time, the balance after deducting the cost expected to beincurred for the recovery of the goods (including impairment of the value of the returned goods) from the bookvalue of the returned commodity at the time of transfer is recognized as an asset, i.e. the cost of returns receivable,and deducts the net amount carryover cost of the above asset cost according to the book value of the transferredcommodity at the time of transfer. On each balance sheet date, the Company re-estimates the return of future salesand remeasures the above assets and liabilities.Warranty obligationsAccording to the contract and legal provisions, the Company provides quality assurance for the sale of goods,construction of the project, etc. For the warranty quality assurance designed to assure customers that the productssold meet established standards, the Company conducts accounting treatment in accordance with the AccountingStandards for Business Enterprises No. 13 - Contingencies. For service class quality assurance that provides aseparate service in addition to assuring customers that the goods sold meet established standards, the Companyregards it as a single performance obligation and apportions part of the transaction price to the service class qualityguarantee in accordance with the relative proportion of the separate price for providing goods and service classquality guarantee, and recognizes the revenue when the customer obtains the control of the service. When assessingwhether quality assurance provides a separate service in addition to assuring the customer that the goods sold meetestablished standards, the Company considers such factors as whether the warranty is a statutory requirement, thequality warranty period and the nature of the task to which the Company is committed.Principal responsible persons and agentsThe Company determines whether the status at the time of engaging in a transaction is that of a principal responsibleperson or agent, based on whether the company has control over the goods or services prior to transferring them to
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the customer. The Company can control the commodities or services before transferring them to the customers,therefore, the Company is the principle responsible person, and the revenue is recognized according to the totalconsideration received or receivable. Otherwise, the Company, acting as the agent, shall recognize the revenue onthe basis of the amount of commissions or service charges it is expected to be entitled to receive, this amount shouldbe determined on the basis of the net amount after deducting the price payable to other relevant parties from thetotal consideration received or receivable, or on the basis of the amount or proportion of fixed commissions, etc.Customer consideration payableIf there is a customer consideration payable in the contract, unless the consideration is to obtain other clearlydistinguishable goods or services from the customer, the Company will offset the consideration payable against thetransaction price, and the Company will offset the current revenue at the later time point between the timerecognizing the relevant revenue or the time paying (or promising to pay) the customer consideration.Contractual rights not exercised by the clientIf the Company receives payments for sales of goods or services from customers in advance, it will first recognizesuch payments as liabilities and then turn them into income when the relevant performance obligations are fulfilled.Where any advance received by the Company is not refundable and the Customer may waive all or part of itscontractual rights, and the Company anticipates to be entitled to an amount in connection with the contractual rightswaived by the customer, such amount shall be recognized as revenue pro rata according to the mode in which thecustomer exercises the contractual rights. Otherwise, the Company will convert the relevant balance of the saidliabilities into income only when it is highly unlikely that the customer will require the fulfillment of the remainingperformance obligations.
Change of contractWhen the construction contract between the Company and the customer changes:
① If the change of contract adds a clearly distinguishable construction service and contract price, and the new
contract price reflects the separate selling price of the new construction service, the Company will account for thechange of contract as a separate contract;
② If the change of contract does not belong to the above-mentioned situation ①, and the construction service that
has been transferred and the construction service that has not been transferred on the date of contract change can beclearly distinguished, the Company will regard it as the termination of the original contract, and at the same time,the unperformed part of the original contract and the changed part of the contract are combined into a new contractfor accounting treatment;
③ If the change of contract does not belong to the above-mentioned situation ①, and the construction service that
has been transferred and the construction service that has not been transferred on the date of contract change cannot
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be clearly distinguished, the Company will account for the changed part of the contract as an integral part of theoriginal contract, and the resulting impact on the recognized revenue shall adjust the current revenue on the date ofcontract change.
(2) Specific methods
Specific methods for revenue recognition of the Company are as follows:
① Commodity sales contract
The sales contract between the Company and the customer contains the performance obligation of the transferredgoods, which belongs to the performance obligation at a certain point in time.The revenue recognition of auto sales and jewelry wholesale need to satisfy the following conditions: the Companyhas delivered goods to the customer according to the contract and customer has accepted the goods, the paymenthas been received or the receipt has been obtained and the associated economic benefits are likely to flow in, themajor risks and rewards of ownership of the goods have been transferred, and the legal ownership of the goods hasbeen transferred.
②Auto repair and test contract
The performance obligations contained in the auto repair and test contract between the Company and the customerbelong to the performance obligations at a certain point in time.The revenue recognition of auto repair and test contract needs to meet the following conditions: the Company hascompleted the service of auto repair and test as agreed in the contract, settled all materials and working hours withthe customer, and allowed the customer's automobile to leave the Company's repair shop.
③ Provision of service contract
The provision of service contract between the Company and customers includes the performance obligations forservices related to the rental of real estate, as the customer obtains and consumes the economic benefits brought bythe Company's performance of the contract while the Company performs the contract, the Company considers themas the performance obligations to be performed within a certain period of time, and apportions and recognizes themequally during the service provision period.
④ Real estate lease contract
For the recognition method for the Company's real estate rental income, see "Notes Ⅳ. 28".
26. Government subsidy
(1) Recognition
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Government subsidies are recognized when the following conditions are met at the same time:
①The company can meet the conditions attached to the government subsidies;
②The company can receive government subsidies.
(2) Measurement
If the government subsidy is a monetary asset, it shall be measured according to the amount received or receivable.If the government subsidy is a non-monetary asset, it shall be measured at fair value; If the fair value cannot bereliably obtained, it shall be measured according to the nominal amount of 1 yuan.
(3) Accounting treatment of government subsidies
① Asset-related government subsidies
The government subsidies obtained by the company for the purchase and construction or the formation of long-termassets in other ways are classified as the government subsidies related to assets. Government subsidies related toassets are recognized as deferred income, which shall be included into profits and losses in a reasonable andsystematic way in the service life of the relevant assets. Government subsidies measured in nominal amounts shallbe directly included in current profits and losses. If the relevant assets are sold, transferred, scrapped or destroyedbefore the end of their useful life, the undistributed balance of relevant deferred income shall be transferred to thecurrent profit sand loss of the asset disposal.
② Government subsidies related to income
Government subsidies other than those related to assets are classified as income-related government subsidies. Thegovernment subsidies related to income shall be conducted accounting treatment according to the followingregulations in different cases:
Those used to compensate the relevant costs or losses of the Company in subsequent periods shall be recognized asdeferred income and shall be recorded into the current profits and losses during the period in which the relevantcosts or losses are recognized;Those used to compensate the relevant costs or losses incurred by the Company shall be directly recorded into thecurrent profit and loss.For the government subsidies that contain both the part related to assets and the part related to income, separatedifferent parts for accounting treatment; for the indistinguishable part, the whole is classified as income-relatedgovernment subsidies.
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Government subsidies related to the daily activities of the Company shall be included in other earnings inaccordance with the substance of economic business. The government subsidies unrelated to the daily activities ofthe Company shall be included in the non-operating income and expenditure.
③ Policy-based preferential loan with discounted interest
If the finance allocates the funds with discounted interest to the lending bank, and the lending bank provides theCompany with a loan at a policy-based preferential interest rate, the actual amount of the received loan shall betaken as the entry value of the loan, and the relevant borrowing costs shall be calculated according to the loanprincipal and the policy-based preferential interest rate.If the finance directly allocates the funds with discounted interest to the Company, and the Company shall offset therelevant borrowing costs with the corresponding discounted interest.
④Return of government subsidies
When the recognized government subsidies need to be returned, the book value of the assets shall be adjusted if thebook value of the relevant assets is written down during the initial recognition; If there is a balance of the relevantdeferred income, the book balance of the relevant deferred income shall be written down, and the excess part shallbe included into the current profits and losses; Under other circumstances, they shall be directly recorded into currentprofits and losses.
27. Deferred income tax assets /deferred income tax liabilities
The Company usually recognizes and measures the amount of income tax impact of taxable temporary differencesor deductible temporary differences as deferred income tax liabilities and deferred income tax assets by using thebalance sheet liability method based on the temporary differences between the book value of assets and liabilitieson the balance sheet date and the tax base. The Company does not discount deferred tax assets and deferred taxliabilities.
(1) Recognition of deferred tax assets
For deductible temporary differences, deductible losses and tax credits that can be carried forward to the next year,their amount of impact on income tax is calculated at the expected income tax rate during the reversal period and isrecognized as a deferred income tax asset, but is within the limit of future taxable income that the Company arelikely to use to offset deductible temporary differences, deductible losses and tax credits.The impact amount of income tax of a deductible temporary difference arising from the initial recognition of anasset or liability in a transaction or event simultaneously having both the following characteristics shall not berecognized as a deferred income tax asset:
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A. The transaction is not a business merger;B. The transaction occurs without affecting either accounting profit or taxable income (or deductible loss).The impact amount of income tax of the Company's deductible temporary differences related to its investments insubsidiaries, associated companies and joint ventures shall be recognized as deferred income tax assets if both ofthe following conditions are met:
A. Temporary differences are likely to be reversed in the foreseeable future;B. Taxable income is likely to be obtained in the future to offset the deductible temporary difference;At the balance sheet date, if there is conclusive evidence that sufficient taxable income is likely to be obtained inthe future period to offset the deductible temporary difference, the deferred income tax assets not recognized in theprevious period shall be recognized.At the balance sheet date, the Company reviews the book value of the deferred tax assets. Write down the bookvalue of the deferred tax asset if it is likely that sufficient taxable income will not be available to offset the benefitof the deferred tax asset in future periods. When sufficient taxable income is likely to be obtained, the amount ofthe write-down shall be reversed.
(2) Recognition of deferred income tax liabilities
The impact of all taxable temporary differences of the Company on income tax is measured at the expected incometax rate during the reversal period and is recognized as a deferred income tax liability, except in the following cases:
① The effect of taxable temporary differences on income tax arising from the following transactions or events is
not determined as a deferred income tax liability:
A. Initial recognition of goodwill;B. Initial recognition of assets or liabilities arising from transactions having the following characteristics: thetransaction is not a business combination and affects neither accounting profit nor taxable income or deductiblelosses when the transaction occurs.
② The impact amount of income tax of the Company's taxable temporary differences related to its investments in
subsidiaries, associated enterprises and joint ventures shall be recognized as deferred income tax liabilities, exceptwhere the following two conditions are met:
A. The Company can control the time for the temporary difference to be reversed;
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B. The temporary difference is unlikely to reverse in the foreseeable future.
(3) Recognition of deferred income tax liabilities or assets involved in a particular transaction or event
① Deferred income tax liabilities or assets related to the business combination
For taxable temporary differences or deductible temporary differences arising from business combinations not underthe same control, when a deferred tax liability or deferred tax asset is recognized, the associated deferred incometax expense (or income) is usually adjusted for the goodwill recognized in the business combination.
②Items directly included in owners' equity
The current income tax and deferred income tax related to the transaction or event directly included in the owner'sequity shall be included in the owner's equity. The influence of temporary differences on income taxes are includedin the transactions or events of owners' equity, including other comprehensive income generated by changes in fairvalue of other creditor's rights investments, retained earnings at the beginning of the period adopting retroactiveadjustment method for changes in accounting policies or adjusting retroactive restatement method for prior (orimportant) accounting errors correction difference, and hybrid financial instruments containing both liabilitiesingredients and equity ingredients at the same time included in the owner's equity at the initial recognition, etc.
③ Recoverable loss and tax deduction
A. Recoverable losses and tax deductions arising from the Company's own operationsDeductible loss refers to the loss calculated and determined in accordance with the provisions of the tax law whichis allowed to be made up with the taxable income of subsequent years. Uncovered losses (deductible losses) and taxdeductions that can be carried forward to subsequent years in accordance with the provisions of the tax law shall bedealt with as deductible temporary differences. Where sufficient taxable income is likely to be obtained in the futureperiods in which losses or tax deductions are expected to be available, the corresponding deferred income tax assetshall be recognized within the limit of the taxable income likely to be obtained, and the income tax expense in thecurrent income statement shall be reduced.B. Recoverable uncovered losses of the combined enterprise resulting from business combinationIn a business combination, the Company shall not recognize the deductible temporary differences acquired by theacquiree that do not meet the conditions for the recognition of deferred income tax assets on the purchasedate.Within 12 months after the acquisition date, if new or further information indicates that relevant conditionsexisted on the date of purchase, and it is expected that the economic benefits of the acquiree brought by thedeductible temporary differences on the purchase date can be realized, recognize the relevant deferred income taxassets, and reduce the goodwill at the same time, if the goodwill is insufficient for write-down, the difference part
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shall be recognized as the current profits and losses; In addition to the above conditions, the deferred income taxassets related to the business combination shall be recognized and recorded into the current profits and losses.
④Temporary differences formed by merger offset
When preparing the consolidated financial statements, where there is a temporary difference between the book valueof the assets or liabilities in the consolidated balance sheet and the tax base of the taxable entity due to the offset ofunrealized internal sales gains and losses, the deferred income tax assets and deferred income tax liabilities shall berecognized in the consolidated balance sheet, and the income tax expenses in the consolidated income statementshall be adjusted at the same time, but except for the transactions or events directly included in owners' equity andthe deferred income taxes related to the business combination.
⑤ Equity-settled share-based payments
If the tax law allows a pre-tax deduction for expenses related to share-based payments, within the period duringwhich costs and expenses are recognized in accordance with accounting standards, the Company shall calculate anddetermine its tax base and temporary differences arising therefrom according to the amount of pre-tax deductionsestimated by the information obtained at the end of the accounting period, and recognize the relevant deferredincome taxes in compliance with recognition conditions. Among them, the amount that can be deducted before taxin the future period is expected to exceed the cost and expense related to share-based payment recognized inaccordance with the provisions of accounting standards, and the income tax impact of the excess part shall bedirectly recorded into the owner's equity.
28. Leasing
(1) Accounting treatment of operating leases
The Company recognizes the lease receipts as rental income on a straight-line basis during each period of the leaseterm, and capitalizes the initial direct expenses incurred and amortizes them on the same basis as the recognition ofrental income, and includes in the current profit and loss in installments. The variable lease payments obtained bythe Company related to operating leases but not included in the lease receipts are included in the current profit andloss when actually incurred.
(2) Accounting treatment of finance lease
On the lease start date, the Company recognizes the finance lease receivables based on the net investment in thelease (the sum of the unguaranteed residual value and the present value of the lease receipts not yet received on thelease start date and discounted at the interest rate implicit in the lease), and derecognizes the financial lease assets.During each period of the lease term, the Company calculates and recognizes interest income based on the interest
| 113 |
rate implicit in the lease. The variable lease payments obtained by the Company that are not included in themeasurement of net lease investment are included in the current profit and loss when they are actually incurred.V. Taxes
1. Type of tax and rate for main applicable tax
| Taxes | Basis | Rate |
VAT
services
13%, 11%, 9%, 5%, 6%, 3%
| Selling goods or providing taxable | ||
| Consumption tax | Sell goods | 0.1 |
Urban maintenance and construction tax
the remaining value after deducting 30%of the original value of the property; taxon 12% of rent income for calculationand collection based on rent
1.2%, 12%
| Price-based resource tax, 1.2 percent of | ||
| Enterprise income tax | Turnover tax payable | 0.07 |
| Educational surtax | Turnover tax payable | 0.03 |
| Local education surcharge | Turnover tax payable | 0.02 |
| Enterprise income tax | Taxable income | 20%, 25% |
Rate of income tax for different taxpaying body:
| Taxpaying body | Rate of income tax |
| Shenzhen Xinyongtong Auto Vehicle Inspection Equipment |
Co., Ltd.
0.2
| Shenzhen Huari Anxin Automobile Inspection Ltd. | 0.2 |
| Shenzhen Tellus Chuangying Tech. Co., Ltd. | 0.2 |
| Other taxpaying body than the above | 0.25 |
2. Tax preferential
According to the “Notice on Implementation of Preferential Tax-reduction & Exemption Policies for Small & Micro Enterprises” (CaiShui [2019] No.13) issued by SAT (State Administration of Taxation), Shenzhen Xinyongtong Auto Vehicle Inspection EquipmentCo., Ltd., Shenzhen Huari Anxin Automobile Inspection Ltd. and Shenzhen Tellus Chuangying Tech. Co., Ltd. enjoys the preferentialtax policies for small & micro enterprises with enterprise income tax at the rate of 20%.VI. Annotation to main items of consolidated financial statements
1. Monetary funds
Unit: RMB/CNYItem Ending balance Opening balance
| Cash on hand | 9,691.12 | 36,941.24 |
| Cash in bank | 219,723,053.11 | 240,545,115.92 |
| 114 |
Total 219,732,744.23 240,582,057.16
has restrictions on use due to mortgage,
| pledge or freezing |
27,188,802.59 26,926,471.30
Other explanation:
As of June 30, 2022, bank deposits of 27,188,802.59 yuan is the supervision fund by the Company developed the land plot 03 projectof the upgrading project of Tellus-Gman Gold Jewelry Industrial Park. 2,000,000 yuan refers to the performance bond, in addition,there are no other amount in the monetary funds at the end of the period that are subject to restrictions on use and potential recoveryrisks due to mortgages, pledges or freezes.
2. Trading financial assets
Unit: RMB/CNYItem Ending balance Opening balance
and with variation reckoned into current
| gains/losses |
422,095,775.34 412,712,843.84Including:
Structured deposits and wealth
422,095,775.34 412,712,843.84Including:
Total422,095,775.34 412,712,843.84
3. Account receivable
(1) Category
Unit: RMB/CNYCategor
y
Ending balance Opening balanceBook balance Bad debt provision
Bookvalue
Book balance Bad debt provision
BookvalueAmount Ratio Amount
Accrual
ratio
Amount Ratio Amount
Accrual
ratioAccountreceivable withbad debtprovision accrualon asinglebasis
68,796,4
09.16
65.95%
48,981,6
34.40
71.20%
19,814,7
74.76
48,781,4
85.16
72.74%
48,781,4
85.16
100%
Accountreceivable withbad debtprovision accrualonportfolio
35,517,0
01.20
34.05%
183,413.
0.52%
35,333,5
88.07
18,277,4
73.05
27.26%
183,413.
100.00%
18,094,0
59.92
| 115 |
Total
100.00%
| 104,313,410.36 | 49,165,047.53 |
47.13%
| 55,148,362.83 | 67,058,958.21 |
100.00%
73.02%
| 48,964,898.29 | 18,094,059.92 |
Bad debt provision accrual on single basis:
Unit: RMB/CNYName
Ending balanceBook balance Bad debt provision Accrual ratio Accrual causesShenzhen JinluIndustry and Trade Co.,Ltd.
9,846,607.00 9,846,607.00 100%
The account age is longand is not expected tobe recoveredGuangdong ZhanjiangSanxing Auto ServiceCo., Ltd.
4,060,329.44 4,060,329.44 100%
The account age is longand is not expected tobe recoveredWang Changlong
2,370,760.40 2,370,760.40 100%
and is not expected to
| be recovered |
Huizhou JiandachengDaoqiao EngineeringCompany
2,021,657.70 2,021,657.70 100%
The account age is longand is not expected tobe recoveredJiangling AutomobileFactory
1,191,059.98 1,191,059.98 100%
The account age is longand is not expected tobe recoveredYangjiang Auto TradeCo., Ltd.
1,150,000.00 1,150,000.00 100%
The account age is longand is not expected tobe recoveredGuangdong MaterialsGroup Corp
1,862,000.00 1,862,000.00 100%
The account age is longand is not expected tobe recoveredShenzhen NuoqiJewelry Co., Ltd.
20,014,924.00 200,149.24 1%
in line with provision
| for the single large amount |
Other 26,279,070.64 26,279,070.64 100%
and is not expected to
| be recovered |
Total 68,796,409.16 48,981,634.40
Bad debt provision accrual on portfolio:
Unit: RMB/CNYName
Ending balanceBook balance Bad debt provision Accrual ratio
| Aging portfolio | 35,517,001.20 | 183,413.13 | 0.52% |
If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses, pleaserefer to the disclosure of other account receivables to disclose related information about bad-debt provisions:
□ Applicable √Not applicable
By account age
Unit: RMB/CNY
| 116 |
Account age Ending balanceWithin one year (including one year)35,513,641.201-2 years2- 3 years 3,360.00Over 3 years68,796,409.16Over 5 years 68,796,409.16Total104,313,410.36
(2) Bad debt provision accrual, collected or reversal in the period
Bad debt provision accrual in the period:
Unit: RMB/CNYCategory
Openingbalance
Amount changed in the period
Ending balanceAccrual
Collected orreversal
Written-off OtherAccountreceivable withbad debtprovisionaccrual on a
48,781,485.16 200,149.24 48,981,634.40
| single basis |
| Account |
receivable withbad debtprovisionaccrual on
183,413.13 183,413.13Total48,964,898.29 200,149.24 49,165,047.53
(3) Top 5 account receivables at ending balance by arrears party
Unit: RMB/CNYEnterprise
portfolio
Ending balance of accounts
receivable
| Ending balance of accounts receivable | Proportion in total receivables at ending balance | Bad debt preparation ending balance | |
| Shenzhen Jinlu Industry and Trade Co., Ltd. |
9,846,607.00 9.44% 9,846,607.00
Sanxing Auto Service Co.,
| Ltd. |
4,060,329.44 3.89% 4,060,329.44
3,358,649.44 3.22% 29,810.07
| Shenzhen Shangjinyuan Jewelry Industry Co., Ltd. | |||
| Wang Changlong | 2,370,760.40 | 2.27% | 2,370,760.40 |
| Guangdong Materials Group | 2,021,657.70 | 1.94% | 2,021,657.70 |
Total 21,658,003.98 20.76%
4. Accounts paid in advance
(1) By account age
Unit: RMB/CNY
| 117 |
Account age
Ending balance Opening balanceAmount Ratio Amount RatioWithin one year 13,880,282.14 99.91% 16,519,701.91 99.92%Over 3 years 12,525.94 0.09% 12,525.94 0.08%Total13,892,808.08
16,532,227.85
(2) Top 5 account paid in advance at ending balance by prepayment object
| Name | Ending balance | Proportion in prepayment balance at the end of period |
| FAW Toyota Motor Sales Co., Ltd. | 9,374,525.58 | 67.48% |
| Toyota Motor (China) Investment Co., Ltd. | 1,264,424.00 | 9.10% |
| Kingdee Software (China) Co., Ltd. | 1,012,679.25 | 7.29% |
| Xiaopeng Automobile Sales Co., Ltd. | 842,355.78 | 6.06% |
| Shenzhen Wonder Construction Group Co., Ltd. | 361,025.45 | 2.60% |
| Total | 12,855,010.06 | 92.53% |
5. Other account receivable
Unit: RMB/CNYItem Ending balance Opening balanceInterest receivable
0.00 0.00Dividends receivable 547,184.35 547,184.35Other account receivable7,007,270.18 4,525,786.42Total 7,554,454.53 5,072,970.77
(1) Interest receivable
Not applicable
3) Provision for bad debts
□ Applicable √Not applicable
(2) Dividends receivable
1) Category
Unit: RMB/CNYItem (or invested unit)Ending balance Opening balance
547,184.35 547,184.35Total 547,184.35 547,184.35
2) Important dividend receivable with account age over one year
Unit: RMB/CNYItem (or invested unit) Ending balance Account ageReasons for non-Whether there is
| 118 |
recovery
| recovery | impairment and its |
judgment basisChina PudongDevelopmentMachinery IndustryCo., Ltd
547,184.35 2-3 years Not yet paid
normal financial statusand operationconditions, thedividend receivablehave not been
| impaired. |
Total 547,184.35
3) Provision for bad debts
□ Applicable √Not applicable
(3) Other account receivable
1) By nature
Unit: RMB/CNYNature Ending book balance Opening book balance
| Deposit margin | 1,652,247.03 | 598,861.89 |
| Reserve fund | 120,000.00 | 0 |
| Interim payment receivable | 56,976,953.77 | 104,970,218.27 |
Total58,749,200.80 105,569,080.16
2) Provision for bad debts
Unit: RMB/CNYBad debt provision
| Phase I | Phase II | Phase III |
TotalExpected credit losses
over next 12 months
for the entire duration
(without credit
| impairment occurred) | Expected credit losses |
for the entire duration(with credit impairment
Balance on Jan. 1,2022
58,951.65 51,682,978.97 51,741,930.62Balance of Jan. 1, 2022in the period
Balance on Jun. 30,2022
58,951.65 51,682,978.97 51,741,930.62Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
By account age
Unit: RMB/CNYAccount age Ending balanceWithin one year (including one year) 4,066,926.421-2 years531,458.102-3 years 82,621.56Over 3 years54,068,194.72
| 119 |
Over 5 years 54,068,194.72Total58,749,200.80
3) Bad debt provision accrual, collected or reversal in the period
Not applicable
4) Other account receivable actually written-off in the period
Not applicable
5) Top 5 other receivables at ending balance by arrears party
Unit: RMB/CNYEnterprise Nature Ending balance Account age
ending balance ofother account
| receivables |
Ending balance of
bad debt reserveZhongqi SouthChina Auto SalesCompany
Intercourse funds 9,832,956.37 Over 3 years 16.74% 9,832,956.37South Industry &TRADE ShenzhenIndustrialCompany
Intercourse funds 7,359,060.75 Over 3 years 12.53% 7,359,060.75
ShenzhenZhonghao (Group)Co., Ltd
Intercourse funds 5,000,000.00 Over 3 years 8.51% 5,000,000.00
SpecialAutomobile
| Industry Co., Ltd. |
Intercourse funds 4,413,728.50 Over 3 years 7.51% 2,206,864.25
Beili ElectricalAppliances Co.,
| Ltd. |
Intercourse funds 2,706,983.51 Over 3 years 4.61% 2,706,983.51Total
29,312,729.13
49.89% 27,105,864.88
6) Other account receivables related to government grants
Not applicable
7) Other receivable for termination of confirmation due to the transfer of financial assets
Not applicable
| 120 |
8) The amount of assets and liabilities that are transferred other receivable and continued to be involved
Not applicable
6. Inventories
Does the company need to comply with the disclosure requirements of the real estate industryNo
(1) Category
Unit: RMB/CNY
Item
Ending balance Opening balanceBook balance
inventory
depreciation or
contractperformance
cost impairment
| provision |
Book value Book balance
inventorydepreciation orcontractperformancecost impairment
| provision |
Book value
| Raw materials | 15,829,602.24 | 14,772,382.17 | 1,057,220.07 | 15,814,028.99 | 14,772,382.17 | 1,041,646.82 |
| Inventory | 41,486,464.73 | 15,117,773.94 | 26,368,690.79 | 39,261,052.16 | 14,867,773.94 | 24,393,278.22 |
Total57,316,066.97 29,890,156.11 27,425,910.86 55,075,081.15 29,640,156.11 25,434,925.04
(2) Provision for inventory depreciation or contract performance cost impairment provision
Unit: RMB/CNYItem Opening balance
Current amount increased Current amount decreased
Ending balanceAccrual Other
Reversal or
write-off
Other
| Raw materials | 14,772,382.17 | 14,772,382.17 | ||||
| Inventory | 14,867,773.94 | 250,000.00 | 15,117,773.94 |
Total 29,640,156.11 250,000.00 29,890,156.11
(3) Explanation on inventories with capitalization of borrowing costs included at ending balance
Not applicable
(4) Description of the current amortization amount of contract performance costs
Not applicable
7. Other current assets
Unit: RMB/CNYItem Ending balance Opening balance
| Reclassification of the VAT debit balance | 3,630,901.41 | 8,596,585.57 |
Total3,630,901.41 8,596,585.57
| 121 |
8. Long-term account receivable
(1) Long-term account receivable
Unit: RMB/CNYItem
Ending balance Opening balance
Discount
rateintervalBook balance
Bad debtprovision
Bookvalue
Book balance
Bad debtprovision
Bookvalue
2,179,203.68 2,179,203.68 0.00 2,179,203.68 2,179,203.68 0.00Total 2,179,203.68 2,179,203.68 0.00 2,179,203.68 2,179,203.68 0.00
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
9. Long-term equity investment
Unit: RMB/CNYTheinvested entity
Openin
gbalance
(bookvalue)
RelatedtransactionsCurrent changes (+, -)
Endingbalance(bookvalue)
Endingbalance
ofimpairmentprovisi
onAdditio
nalinvestm
ent
Capitalreducti
on
| Current changes (+, -) | ||
| Investm | ||
entgainsrecogni
zedunder
Othercomprehensiveincomeadjustm
ent
Otherequitychange
| equity | Cash |
dividend orprofitannounced to
Accrualofimpairmentprovisi
on
Other
| issued | |||
| I. Joint venture | |||
| Shenzh | |||
enTellusGmanInvestment Co.,
47,490,
740.78
8,739,1
42.07
15,000,
000.00
41,229,
882.85
| Ltd |
| Shenzh |
enTellusHangInvestment Co.,Ltd.[Note
13,452,
222.35
350,111
.20
13,802,
333.55
Subtotal
| 5] | |
| 60,942,963.13 |
| 9,089,253.27 | 15,000,000.00 |
| 55,032,216.40 | ||
| II. Associated enterprise | ||
ShenzhenZungFuTellusAutoServiceCo.,
27,367,
904.34
-1,161,4
65.69
26,206,
438.65
| Ltd. |
| Shenzh |
en
| 122 |
obile
IndustryImportandExportCo.,
| Ltd. |
| Shenzh |
enXinyongtongOilPumpEnvironmentProtection Co.,
127,836.59
| Ltd. |
| Shenzh |
enXinyongtongConsultant Co.,
41,556.
ShenzhenTellusAutomobileServiceChainCo.,Ltd.[Note
| Ltd. |
| 3] |
enXinyongtongAutoServiceCo.,Ltd.[Note
| 3] |
enXinyongtongDongxiao AutoServiceCo.,
| Ltd. |
| 123 |
Yongto
ngXindaInspectionEquipment Co.,Ltd.[Note
| 3] |
| Hunan |
ChangyangIndustrial Co.,Ltd.[Note
1,810,5
40.70
| 1] |
| Shenzh |
enJiechengElectronic Co.,Ltd.[Note
3,225,0
00.00
ShenzhenXiandao NewMaterials Co.,Ltd.[Note
| 1] |
| 1] |
4,751,6
21.62
AutoIndustrialShenzhenTradingCompany[Note
| 1] |
400,000
.00
enGeneralStandard Co.,Ltd.[Note
| 1] |
500,000
.00
en
| Zhongq |
2,250,0
00.00
| 124 |
i South
ChinaAutoSalesCompany[Note
| 1] |
| Shenzh |
enBailiyuanPowerSupplyCo.,Ltd.[Note
1,320,0
00.00
| 1] |
| Shenzh |
enYiminAutoTradingCompany[Note
200,001
.10
ShenzhenTorchSparkPlugIndustryCompa
| 1] |
| ny |
17,849.
enHanliHigh-TechCeramics Co.,Ltd.[Note
| 2] |
1,956,0
00.00
enSouthAutomobileRepairCenter[Note
| 2] |
6,700,0
00.00
Subtotal
27,367,
904.34
1,161,4
| 65.69 |
26,206,
438.65
23,300,
406.04
| 125 |
Total
| 88,310,867.47 | 7,927,787.58 |
| 15,000,000.00 | 81,238,655.05 | 23,300,406.04 |
Other explanationNote 1: Business registration of the above companies have been revoked and the Company has made a full provision for impairmentof these long-term equity investment.Note 2: Operating period of Shenzhen Hanli High-Tech Ceramics Co., Ltd is from September 21, 1993 to September 21, 1998;operating period of Shenzhen South Automobile Repair Center is from July 12, 1994 to July 11, 2002. the companies have ceased theirbusiness activities for many years, business registration have been revoked for failure to participate in annual inspection. It is unableto exercise effective control over these companies, which are excluded in the scope of consolidation statement, and the carrying valueof the investment in those companies is Zero.Note 3: the carrying amount of these long-term equity investment was 0 yuan after adjusting for the recognition of gain/loss under theequity methodNote 4: equity of the enterprise held by the Company have been transferred in the Period.Note 5: we has a 51% equity of the enterprise. According to relevant regulation of the Article of Association, the voting rights held bythe Company are not sufficient to unilaterally pass the votes of the shareholders’ meeting and BOD on the relevant decision-makingmotions, the Company does not control the enterprise
10. Other equity instrument investment
Unit: RMB/CNYItem Ending balance Opening balance
| Unlisted equity instrument investment | 10,176,617.20 | 10,176,617.20 |
Total10,176,617.20 10,176,617.20
Itemized disclosure of investment in non-trading equity instruments for the current period
Unit: RMB/CNY
Item
Recognized
dividendincome
Cumulative
gain
Accumulated
loss
The amount of
othercomprehensive
incometransferred to
retained
earnings
the designationas beingmeasured at fair
value and the
changeincluded in
othercomprehensive
| income |
Reasons fortransferring
othercomprehensive
income toretained incomeChina PudongDevelopmentMachineryIndustry Co.,
Strategicinvestment thatis expected tobe held for along time
| 126 |
11. Investment real estate
(1) Measured at cost
√ Applicable □Not applicable
Unit: RMB/CNYItemHouse and building Land use right
Total
| Construction in progress | ||||
| I. Original book value |
1.Opening balance
645,997,222.66 49,079,520.00 695,076,742.66
2.Current amount
increased
| (1) Outsourcing | ||||
| (2) Inventory\fixed |
assets\construction in
3.Current amount
decreased
process transfer-in
(1) Disposal
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
4.Ending balance 645,997,222.66 49,079,520.00 695,076,742.66
depreciation andaccumulated
| amortization |
1.Opening balance
140,347,117.08 3,346,331.04 143,693,448.12
2.Current amount
increased
9,305,204.58 557,724.18 9,862,928.76
9,305,204.58 557,724.18 9,862,928.76
| (1) Accrual or amortization | ||||
3.Current amount
decreased
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
4.Ending balance
149,652,321.66 3,904,055.22 153,556,376.88
1.Opening balance
2.Current amount
increased
(1)Accrual
III. Impairmentprovision
3.Current amount
decreased
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
4.Ending balance
| IV. Book value |
| 127 |
1.Ending book value
| 1.Ending book value | 496,344,901.00 | 45,175,464.78 | 541,520,365.78 | |
| 2. Opening book value | 505,650,105.58 | 45,733,188.96 | 551,383,294.54 |
(2) Measure at fair value
□ Applicable √Not applicable
(3) Investment real estate without property certificate completed
| Item | Book value | Reasons |
Nuclear Office build
4,280,281.38
Failure to handle the ownership certificate
for historical reasons12 buildings in Sungang
12,588.53
Failure to handle the ownership certificate
for historical reasons12 building shops in Sungang
38,916.87
Failure to handle the ownership certificate
for historical reasons
| Total | 4,331,786.78 |
12. Fixed assets
Unit: RMB/CNYItem Ending balance Opening balance
Fixed assets
| Fixed assets | 112,837,946.28 | 109,438,198.23 |
Total 112,837,946.28 109,438,198.23
(1) Fixed assets
Unit: RMB/CNYItem
| House and buildings | Machinery equipment | Transport equipment | Electronic equipment | Office and other equipment |
Total
| I. Original book value: |
1.Opening balance 274,856,177.01 22,226,232.29 5,835,922.65 12,344,805.36 7,850,954.29 323,114,091.60
2.Current amount
increased
8,535,210.00 12,649.56 155,178.10 359,332.64 117,820.93 9,180,191.23
| (1) Purchase | 8,535,210.00 | 12,649.56 | 9,180,191.23 |
(2) Transfer of
construction in progress
3.Current amount
decreased
515,733.46 2,819.66
515,733.46 2,819.66
4.Ending balance
283,391,387.01 22,238,881.85 5,475,367.29 12,701,318.34 7,968,775.22 331,775,729.71
(1) Disposal or
scrapII. Accumulateddepreciation
1.Opening balance
184,795,722.04 9,720,537.85 3,555,622.71 8,426,565.35 2,931,992.36 209,430,440.31
2.Current amount
increased
3,763,028.26 614,348.36 248,175.17 417,954.87 457,951.43 5,501,458.09
| 128 |
(1)Accrual 3,763,028.26 614,348.36 248,175.17 417,954.87 457,951.43 5,501,458.09
3.Current amount
decreased
237,030.34 2,537.69 239,568.03
237,030.34 2,537.69 239,568.03
4.Ending balance
188,558,750.30 10,334,886.21 3,803,797.88 8,844,520.22 3,389,943.79
| (1) Disposal or scrap | ||
214,692,330.37
| III. Impairment provision |
1.Opening balance 3,836,768.43 319,675.11 6,165.00 17,984.71 64,859.81 4,245,453.06
2.Current amount
increased
(1)Accrual
3.Current amount
decreased
4.Ending balance 3,836,768.43 319,675.11 6,165.00 17,984.71 64,859.81 4,245,453.06
(1) Disposal or
scrapIV. Book value
| IV. Book value |
1.Ending book value
90,995,868.28
11,584,320.53
1,665,404.41
3,838,813.41
4,513,971.62
112,837,946.28
| 2. Opening book value | 86,223,686.54 | 12,186,019.33 | 2,274,134.94 | 3,900,255.30 | 4,854,102.12 | 109,438,198.23 |
(2) Temporarily idle fixed assets
Not applicable
(3) Fixed assets leased out by operation
Not applicable
(4) Fix assets without property certification held
Unit: RMB/CNYItem Book value
Yongtong Building
28,396,915.34
| Reasons for without the property certification |
| Failure to handle the ownership certificate for historical reasons |
Automotive building
14,629,948.69
Tellus Building underground parking
8,477,976.20
Parking lot is un-able to carried out thecertificate1#,2# and 3-5/F 3# plant of TaoyuanRoad
3,265,867.51
Failure to handle the ownershipcertificate for historical reasonsTellus Building transformation layer
1,426,541.48
Un-able to carried out the certificate16# Taohua Garden
1,252,104.42
Failure to handle the ownershipcertificate for historical reasonsFailure to handle the ownershipcertificate for historical reasons
Shuibei Zhongtian comprehensivebuilding
661,581.60
Failure to handle the ownership
certificate for historical reasons
| 129 |
First floor of Bao’an commercial-residence build
817,290.20
Failure to handle the ownershipcertificate for historical reasonsWarehouse
795,291.01
Trade department warehouse
63,803.65
| Failure to handle the ownership certificate for historical reasons |
| Failure to handle the ownership certificate for historical reasons |
Songquan Apartment (mixed)
10,086.79
Hostel of Renmin North Road
5,902.41
| Failure to handle the ownership certificate for historical reasons | ||
| Failure to handle the ownership certificate for historical reasons | ||
| Subtotal | 59,803,309.30 |
13. Construction in progress
Unit: RMB/CNYItem Ending balance Opening balance
| Construction in progress | 261,124,333.54 | 210,197,546.72 |
Total261,124,333.54 210,197,546.72
(1) Construction in progress
Unit: RMB/CNYItem
Ending balance Opening balanceBook balance
Impairmentprovision
Book value Book balance
Impairment
provision
Book value
Trading
| Building |
260,999,489.22 260,999,489.22 210,072,702.40 210,072,702.40
| Other projects | 124,844.32 | 124,844.32 | 124,844.32 | 124,844.32 |
Total 261,124,333.54 261,124,333.54 210,197,546.72 210,197,546.72
(2) Changes of major construction in progress
Unit: RMB/CNY
Item Budget
Openi
ngbalanceCurrentamoun
tincreas
ed
Transf
er-infixedassets
Otherdecreased in
thePeriod
Endingbalanc
e
Proportion ofprojectinvestment
inbudget
Progre
ss
Accumulatedcapitalization
ofinterest
ng:
amoun
t ofcapitalization
ofinteres
t in
| Period |
Interestcapitalizationrate inPeriod
Source
s offunds
JinzhuanTradingBuildi
| ng |
515,460,000.
210,072,702.
50,926,786.8
260,999,489.
50.63
%
50.63
%
4,050,
285.57
4,050,
285.57
100.00
%
FinancialInstitutionLoansTotal
0,000.
| 00 | 210,07 |
2,702.
| 40 | 50,926 |
,786.8
| 2 | 260,99 |
9,489.
4,050,
285.57
4,050,
285.57
100.00
%
| 130 |
14. Right-of-use asset
Unit: RMB/CNYItemHouse and buildingsTotal
| I. Original book value: |
1.Opening balance
10,313,192.96 10,313,192.96
2.Current amount increased
3.Current amount decreased
4.Ending balance 10,313,192.96 10,313,192.96
| II. Accumulated depreciation |
1.Opening balance
2,976,277.13 2,976,277.13
2.Current amount increased 823,543.50 823,543.50
(1)Accrual
823,543.50 823,543.50
3.Current amount decreased
| (1) Disposal | ||
4.Ending balance
3,799,820.63 3,799,820.63
| III. Impairment provision |
1.Opening balance
2.Current amount increased
(1)Accrual
3.Current amount decreased
| (1) Disposal | ||
4.Ending balance
| IV. Book value | ||
| 1.Ending book value | 6,513,372.33 | 6,513,372.33 |
| 2. Opening book value | 7,336,915.83 | 7,336,915.83 |
15. Intangible assets
(1) Intangible assets
Unit: RMB/CNYItemLand use rightPatent rights
Non-patented
technology
Trademark SoftwareTotal
1.Opening
balance
50,661,450.00 128,500.00 5,470,373.66 56,260,323.66
2.Current
amountincreased
3.Current
I. Original bookvalueamount
| 131 |
decreased
| decreased |
| (1) Disposal |
4.Ending
balance
50,661,450.00 128,500.00 5,470,373.66 56,260,323.66II. Accumulatedamortization
1.Opening
balance
2,867,902.16 99,042.56 3,703,880.66 6,670,825.38
2.Current
amountincreased
538,721.58 2,034.96 82,405.16 623,161.70
(1)Ac
crual
538,721.58 2,034.96 82,405.16 623,161.70
3.Current
amountdecreased
| (1) Disposal | ||||||
4.Ending
balance
3,406,623.74 101,077.52 3,786,285.82 7,293,987.08
1.Opening
balance
2.Current
amountincreased
(1)Ac
crual
III. Impairmentprovision
3.Current
amountdecreased
| (1) Disposal | ||||||
4.Ending
balance
| IV. Book value | ||||||
| 1.Ending book value |
47,254,826.26 27,422.48 1,684,087.84 48,966,336.58
47,793,547.84 29,457.44 1,766,493.00 49,589,498.28
16. Long-term expenses to be apportioned
Unit: RMB/CNYItem Opening balance
Current amountincreased
Currentamortization
Other decreasedEnding balance
| 132 |
Renovation costs
| Renovation costs | 28,682,636.66 | 487,995.85 | 2,321,921.53 | 26,848,710.98 |
Total 28,682,636.66 487,995.85 2,321,921.53 26,848,710.98
17. Deferred income tax asset /Deferred income tax liabilities
(1) Deferred income tax assets without offset
Unit: RMB/CNYItem
Ending balance Opening balance
| Deductible temporary differences | Deferred income tax asset | Deductible temporary differences | Deferred income tax asset | |
| Credit impairment provision |
33,998,204.12 8,499,551.03 33,998,204.09 8,499,551.03Total 33,998,204.12 8,499,551.03 33,998,204.09 8,499,551.03
(2) Deferred income tax liability without offset
Unit: RMB/CNYItem
Ending balance Opening balance
| Taxable temporary differences | Deferred income tax liabilities | Taxable temporary differences | Deferred income tax liabilities | |
| Taxable temporary differences |
3,852,181.96 963,045.49 3,852,181.96 963,045.49Total 3,852,181.96 963,045.49 3,852,181.96 963,045.49
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
Unit: RMB/CNYItem
Trade-off between the
deferred income taxassets and liabilities
deferred income taxassets or liabilities after
| off-set | Trade-off between the |
deferred income taxassets and liabilities at
| period-begin | Opening balance of |
deferred income taxassets or liabilities after
| off-set | ||
| Deferred income tax assets |
8,499,551.03 8,499,551.03
963,045.49 963,045.49
(4) Details of uncertain deferred income tax assets
Unit: RMB/CNYItem Ending balance Opening balance
Deferred income taxliabilitiesDeductible temporary differences
| Deductible temporary differences | 126,273,992.95 | 126,073,843.71 |
| Deductible loss | 19,228,072.00 | 19,228,072.00 |
Total 145,502,064.95 145,301,915.71
(5) Deductible losses of un-recognized deferred income tax assets expired on the followed year
Unit: RMB/CNY
| Year | Ending amount | Opening amount | Note |
| 2022 | 330,146.48 | 330,146.48 | |
| 2023 | 401,294.00 | 401,294.00 | |
| 2024 | 497,832.28 | 497,832.28 |
| 133 |
2025
| 2025 | 9,182,475.07 | 9,182,475.07 | |
| 2026 | 8,816,324.17 | 8,816,324.17 |
Total 19,228,072.00 19,228,072.00
18. Other non-current asset
Unit: RMB/CNYItem
Ending balance Opening balanceBook balance
Impairment
provision
Book value Book balance
Impairment
provision
Book value
payment forengineering
| equipment |
42,300,204.90 42,300,204.90 56,169,049.73 56,169,049.73
deducted (inputtax onengineering and
| equipment) |
12,204,839.26 12,204,839.26 12,204,839.26 12,204,839.26
| Other | 100,000.00 | 100,000.00 | 100,000.00 | 100,000.00 |
Total 54,605,044.16 54,605,044.16 68,473,888.99 68,473,888.99
19. Account payable
(1) Account payable
Unit: RMB/CNYItem Ending balance Opening balance
| Purchase of goods and services | 9,121,414.90 | 4,068,460.06 |
| Engineering equipment | 60,657,468.31 | 63,339,302.97 |
Total 69,778,883.21 67,407,763.03
(2) Major accounts payable with age over one year
Unit: RMB/CNYItem Ending balanceReasons of outstanding or carry-over
29,695,887.90Project unsettledShenzhen SDG Real Estate Co., Ltd
6,054,855.46
Unrepayment from related enterprise
Shenzhen Yinglong Jian’an (Group) Co.,Ltd.Shenzhen Yinuo ConstructionEngineering Co., Ltd.
3,555,095.22Project unsettled
| Shenzhen Yinuo Construction Engineering Co., Ltd. | ||
| Shenzhen Cuilu Jewelry Co., Ltd. | 1,120,000.00 | Project unsettled |
Total 40,425,838.58
20. Accounts received in advance
(1) Accounts received in advance
Unit: RMB/CNYItem Ending balance Opening balance
| 134 |
Rent
| Rent | 10,861,839.87 | 1,827,827.28 |
Total 10,861,839.87 1,827,827.28
21. Contractual liabilities
Unit: RMB/CNYItem Ending balance Opening balance
| Advance payment | 6,474,665.61 | 17,959,187.61 |
| Pre-collected service fee | 3,693,924.78 | 3,100,123.57 |
Total 10,168,590.39 21,059,311.18
22. Wage payable
(1) Wage payable
Unit: RMB/CNYItem Opening balance Current increased Current decreased Ending balance
38,893,597.75 32,089,862.24 29,434,049.42 41,549,410.57
| I. Short-term compensation |
| II. After-service |
welfare-defined
2,946,118.91 2,946,118.91
| contribution plans | ||||
| III. Dismissed welfare | 164,485.00 | 164,485.00 |
Total38,893,597.75 35,200,466.15 32,544,653.33 41,549,410.57
(2) Short-term compensation
Unit: RMB/CNYItem Opening balance Current increased Current decreased Ending balance
and subsidy
38,284,893.23 24,557,518.38 22,318,845.89 40,523,565.72
| 1. Wage, bonus, allowance |
| 2. Employees’ welfare |
410,244.25 924,408.26 532,604.01 802,048.50
4,185,930.50 4,185,930.50
| 3. Social insurance charges |
| Including: medical |
insurance premium
4,042,348.97 4,042,348.97
insurance premiums
22,413.40 22,413.40
| Industrial injury |
| Maternity insurance |
premiums
88,062.65 88,062.65
| Other | 33,105.48 | 33,105.48 | ||
| 4. Housing public reserve |
1,935,484.78 1,935,484.78
education fee
198,460.27 486,520.32 461,184.24 223,796.35Total 38,893,597.75 32,089,862.24 29,434,049.42 41,549,410.57
| 135 |
(3) Defined contribution plans
Unit: RMB/CNYItem Opening balance Current increased Current decreased Ending balance
2,917,225.43 2,917,225.43
| 1. Basic endowment insurance premiums |
| 2. Unemployment insurance premiums |
28,893.48 28,893.48Total 2,946,118.91 2,946,118.91
23. Taxes payable
Unit: RMB/CNYItem Ending balance Opening balance
| VAT | 1,589,744.77 | 808,520.40 |
| Enterprise income tax | 9,470,044.63 | 7,964.60 |
| Personal income tax | 604,864.12 | 105,706.61 |
| Urban maintenance and construction tax | 34,608.47 | 47,558.24 |
Land VAT
5,407,284.90 31,705.50
| House property tax | 3,595,591.57 | 41,276,334.18 |
| Use tax of land | 211,756.28 | 512,260.46 |
| Educational surtax | 2,657.88 | 5,362,682.64 |
| Local education surcharges | 361.01 | 26,459.98 |
| Other tax | 138,399.81 | 342,907.84 |
Total 21,055,313.44 48,522,100.45
24. Other account payable
Unit: RMB/CNYItem Ending balance Opening balance
| Interest payable | 0.00 | 0.00 |
| Dividend payable | 0.00 | 0.00 |
| Other account payable | 115,063,036.77 | 112,617,963.65 |
Total 115,063,036.77 112,617,963.65
(1) Other account payable
1) By nature
Unit: RMB/CNYItem Ending balance Opening balance
| Deposit margin | 41,896,024.19 | 41,657,964.73 |
| Related transactions | 30,025,023.86 | 24,146,524.51 |
| Withholding payments | 9,858,819.35 | 15,417,939.62 |
| Payable interim payment | 33,283,169.37 | 31,395,534.79 |
Total 115,063,036.77 112,617,963.65
| 136 |
2) Significant other account payable with over one year age
Unit: RMB/CNYItem Ending balanceReasons for non-repayment or carry-over
12,369,413.94
| Shenzhen Special Development Group Co., Ltd. | Related company non-repayment | |
| Hong Kong Yujia Investment Co., Ltd. |
1,961,673.06
Total 14,331,087.00
25. Non-current liabilities due within one year
Unit: RMB/CNYItem Ending balance Opening balanceLease liabilities due within one year 2,884,263.93 3,021,452.25Total 2,884,263.93 3,021,452.25
26. Other current liabilities
Unit: RMB/CNYItem Ending balance Opening balance
Related company non-repaymentTax amount to be written off
| Tax amount to be written off | 601,487.93 | 2,367,994.70 |
Total601,487.93 2,367,994.70
27. Long-term loans
(1) Classification of long-term loans
Unit: RMB/CNYItem Ending balance Opening balance
| Mortgage loan | 121,670,407.44 | 86,875,874.39 |
Total 121,670,407.44 86,875,874.39
28. Lease liability
Unit: RMB/CNYItem Ending balance Opening balance
| Lease liability | 3,963,266.13 | 4,474,543.09 |
Total3,963,266.13 4,474,543.09
29. Long-term account payable
Unit: RMB/CNYItem Ending balance Opening balance
| Long-term account payable | 3,920,160.36 | 3,920,160.36 |
Total3,920,160.36 3,920,160.36
| 137 |
(1) By nature
Unit: RMB/CNYItem Ending balance Opening balanceDeposit of staff residence
3,908,848.40 3,908,848.40Allocation for technology innovationprojects
11,311.96 11,311.96
30. Accrual liabilities
Unit: RMB/CNYItem Ending balance Opening balanceCausesPending litigation
268,414.80 268,414.80Total 268,414.80 268,414.80
31. Deferred income
Unit: RMB/CNYItem Opening balance Current increased Current decreased Ending balanceCausesGovernmentsubsidies
10,235,331.21 677,196.54 9,558,134.67
government
| subsidies |
Total 10,235,331.21 677,196.54 9,558,134.67
Item with government grants involved:
Unit: RMB/CNYLiability
Openingbalance
New grants
in thePeriod
reckoned innon-operation
| revenue |
Amountreckoned in
other
income
Costreduction
in theperiod
Otherchanges
Endingbalance
Assetsrelated/income relatedElevatorRenewalSubsidyFund forFutianDistrict OldElevatorRenovationWorking
111,188.09 111,188.09
Assetsrelated
| Group |
| Luohu |
District2021specialfunds forindustrialtransformation andupgrading-
3,511,821.2
3,511,821.20
Assetsrelated
| 138 |
serviceplatform
| service platform |
| Luohu |
District2021specialfunds forindustrialtransformation andupgrading-Greenbuildingsupport
2,364,130.4
2,364,130.45
Assetsrelated
| subsidy |
| Subsidy |
revenuefrom theShenzhenMunicipalBureau ofCommercein 2020 topromoteconsumption toenhance thesupport
4,248,191.4
4,248,191.47
Assetsrelated
32. Share capital
Unit: RMB/CNY
Openingbalance
projectIncreased (decreased) in this period+, -
EndingbalanceNew shares
issued
Bonus shares
| Increased (decreased) in this period+, - | ||
| Shares | ||
convertedfrom public
Other SubtotalTotal shares
431,058,320.
| reserve | ||
| 00 |
431,058,320.
33. Capital public reserve
Unit: RMB/CNYItem Opening balance Current increased Current decreased Ending balance
Capital premium
(Share capital
| premium) |
425,768,053.35 425,768,053.35
| Other capital reserve | 5,681,501.16 | 5,681,501.16 |
Total 431,449,554.51 431,449,554.51
34. Other comprehensive income
Unit: RMB/CNY
| 139 |
Item
Openingbalance
Accountbeforeincome taxin the period
written in
othercomprehen
siveincome inpreviousperiod andcarriedforward togains andlosses incurrent
| period | Less: |
written inothercomprehen
siveincome inpreviousperiod and
carriedforward to
retainedearnings in
current
Less:
income tax
expense
Belong to
parentcompanyafter tax
Belong tominorityshareholders
after tax
Endingbalance
| period | ||
| II. Other |
comprehensiveincomeitemswhich willbereclassifiedsubsequently to profit
26,422.00 26,422.00
| or loss |
| Including: |
Othercomprehensiveincomeunderequitymethod thatcan transfer
26,422.00 26,422.00
| to gain/loss |
| Total other |
comprehensive
26,422.00 26,422.00
35. Surplus public reserve
Unit: RMB/CNYItem Opening balance Current increased Current decreased Ending balance
incomeStatutory surplusreserves
26,546,480.09 26,546,480.09Total 26,546,480.09 26,546,480.09
36. Retained profit
Unit: RMB/CNYItem
Statutory surplusreserves
Current period
| Current period | Last period | |
| Retained profit at the end of the previous |
period before adjustment
543,843,496.85 424,141,893.34
the previous period before adjustment
543,843,496.85 424,141,893.34
| Total retained profit at the beginning of |
| Add: net profit attributable to |
shareholder of parent company
43,480,236.19 44,542,715.32
| 140 |
Common stock dividends payable
| Common stock dividends payable | 10,781,545.75 | 8,621,166.40 |
| Retained profit at period-end |
576,542,187.29 460,063,442.26
37. Operating income and operating cost
Unit: RMB/CNYItem
Current period Last period
| Income | Cost | Income | Cost | |
| Main business | 245,186,251.37 | 187,271,730.10 | 244,632,938.62 | 172,326,102.86 |
| Other business | 4,828,900.86 | 1,072,447.45 | 4,859,322.62 | 987,151.10 |
Total250,015,152.23 188,344,177.55 249,492,261.24 173,313,253.96
Income related information:
Unit: RMB/CNY
Auto sales
| Contract classification | Auto maintenance and inspection | Lease and service | Jewelry sales and service |
Total
| Product types |
Including:
| Auto sales | 90,748,050.16 | 90,748,050.16 | |||
| Auto maintenance and inspection |
11,522,091.64
| 21,877,337.87 | ||
| Lease and service |
99,498,964.98
| 89,143,718.75 | ||
| Jewelry sales and service |
48,246,045.45 48,246,045.45
Including:
Shenzhen 90,748,050.16
Classified bybusiness area
21,877,337.87
| 21,877,337.87 | 89,143,718.75 |
48,246,045.45 250,015,152.23Market orcustomer type
Including:
Contract type
Including:
| Classification by |
time of goods
Including:
transfer
| Classification by contract duration |
Including:
| Classification by sales channel |
Including:
Total 90,748,050.16 11,522,091.64 99,498,964.98 48,246,045.45 250,015,152.23Information relating to performance obligations: nil
| 141 |
38. Tax and surcharges
Unit: RMB/CNYItem Current period Last period
| Urban maintenance and construction tax | 179,352.95 | 373,364.45 |
| Education surcharge | 127,757.65 | 266,566.48 |
| House property tax | 3,595,591.57 | 1,750,236.76 |
| Use tax of land | 229,898.56 | 132,393.16 |
| Stamp duty | 133,976.69 | 88,215.19 |
| Other taxes | 2,670.00 | 3,380.00 |
Total 4,269,247.42 2,614,156.04
39. Sales expenses
Unit: RMB/CNYItem Current period Last periodStaff remuneration
6,697,191.21 6,414,558.14Advertising and exhibition expenses
355,969.09 813,955.93Depreciation and amortization
1,835,480.94 2,066,128.41Office
294,600.87 202,242.09
| expenses | ||
| Property and utilities | 239,436.33 | 433,397.24 |
Transportation and business trip cost
173,322.82 114,255.71Insurance supervision fee
102,004.55 476,862.25
| Other | 1,249,312.34 | 1,480,912.25 |
Total 10,947,318.15 12,002,312.02
40. Administration expenses
Unit: RMB/CNYItem Current period Last periodStaff remuneration
15,547,995.24 16,070,330.49Office
231,630.78 248,988.77
| expenses |
| Transportation and business trip cost |
18,250.52 124,886.80Business entertainment expenses
130,553.80 170,483.29Depreciation and amortization
1,513,826.81 1,614,251.84Intermediary agency service fee
1,223,090.79 1,285,160.67
| Other | 1,167,569.27 | 1,293,372.83 |
Total 19,832,917.21 20,807,474.69
41. Financial expenses
Unit: RMB/CNYItem Current period Last period
| 142 |
Interest expenses
| Interest expenses | 2,303,220.59 | 1,747,427.56 |
| Less: Interest income | 2,843,386.98 | 1,719,072.96 |
Less: interest capitalized amount
2,194,828.71 547,427.56
| Exchange loss | -65,959.60 | -7,790.79 |
| Other | 99,398.31 | 122,303.86 |
Total -2,701,556.39 -404,559.89
42. Other income
Unit: RMB/CNYSourcesCurrent period Last period
50,129.40 4,082.49
| Handling fee refund for withholding personal income tax | ||
| Other | 1,525,860.90 | 322,337.67 |
43. Investment income
Unit: RMB/CNYItem Current period Last period
7,927,787.58 9,683,638.47
| Long-term equity investment income measured by equity |
| Investment income of trading financial assets during the holding period |
6,774,748.47 4,712,120.21Investment income from disposal oftrading financial assets
8,785,410.47Total 23,487,946.52 14,395,758.68
44. Income of fair value changes
Unit: RMB/CNYSourcesCurrent period Last period
| Trading financial assets | -617,068.50 | -418,952.05 |
Total -617,068.50 -418,952.05
45. Credit impairment loss
Unit: RMB/CNYItem Current period Last period
-200,149.24Total -200,149.24 0.00
46. Non-operating income
Unit: RMB/CNYItem Current period Last period
Loss of bad debt of other accountreceivable
Amount included in the
current non-recurring profit
| and loss | |||
| Other | 295,807.48 | 72,884.60 | 295,807.48 |
Total295,807.48 72,884.60 295,807.48
| 143 |
47. Non-operating expenditure
Unit: RMB/CNYItem Current period Last period
current non-recurring profit
| and loss | |||
| Other | 237.72 | 9,945.86 | 237.72 |
Total 237.72 9,945.86 237.72
48. Income tax expense
(1) Income tax expense
Unit: RMB/CNYItem Current period Last period
| Current income tax expenses | 10,808,747.89 | 11,085,413.51 |
Total 10,808,747.89 11,085,413.51
(2) Adjustment process of accounting profit and income tax expenses
Unit: RMB/CNYItem Current period
| Total profit | 53,906,103.05 |
| Income tax expenses calculated by statutory tax rate | 13,476,525.76 |
| Impact by different tax rate applied by subsidies | -23,350.94 |
| Impact of non taxable income | -1,981,946.90 |
| Unrecognized impacts of deductible temporary differences or deductible losses on deferred income tax assets in the period |
-662,480.04
| Income tax expenses | 10,808,747.89 |
49. Other comprehensive income
More of “Other comprehensive income” and income tax effect and transfer to gain/loss as well as the reconciliationof various items of other comprehensive income found in 34. Other comprehensive income in Note VI
50. Annotation of cash flow statement
(1) Cash received with other operating activities concerned
Unit: RMB/CNYItem Current period Last period
| Deposit margin | 3,980,878.67 | 9,160,722.91 |
| Interest income | 2,843,386.98 | 1,719,072.96 |
| Intercourse funds and other | 88,610,563.21 | 62,509,088.41 |
Total 95,434,828.86 73,388,884.28
| 144 |
(2) Cash paid with other operating activities concerned
Unit: RMB/CNYItem Current period Last period
| Cash paid | 20,599,573.29 | 28,551,813.16 |
| Deposit margin | 4,263,044.41 | 6,501,628.21 |
| Intercourse funds and other | 72,184,949.67 | 42,275,584.65 |
Total 97,047,567.37 77,329,026.02
(3) Cash paid related with investment activities
Unit: RMB/CNYItem Current period Last period
fee on United Property and Equity
| Exchange |
18,669.20Total 18,669.20 0.00
51. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
Unit: RMB/CNY
| Supplementary information | Current period | Last period |
| 1. Net profit adjusted to cash flow of |
operation activities:
| Net profit | 43,097,355.16 | 44,496,619.21 |
| Add: Impairment provision for assets | ||
| Depreciation of fixed assets, |
consumption of oil assets anddepreciation of productive biology assets
15,364,386.85 15,293,526.20
| Depreciation of right-of-use assets | ||
| Amortization of intangible assets | 623,161.70 | 716,715.48 |
| Amortization of long-term pending |
expenses
2,321,921.53 2,080,287.58
intangible assets and other long-termassets (income is listed with “-”)
-40,765.92 -56,242.77
| Loss from disposal of fixed assets, |
| Losses on scrapping of fixed assets |
(income is listed with “-“)
237.72
is listed with “-“)
617,068.50 418,952.05
| Loss from change of fair value (income |
| Financial expenses (income is listed with |
“-”)
108,391.88 1,200,000.00
“-”)
-23,487,946.52 -14,395,758.68
| 145 |
Decrease of deferred income tax assets
(increase is listed with “-”)
19,471.10
| Decrease of deferred income tax assets |
| Increase of deferred income tax assets |
(decrease is listed with “-”)
with “-”)
-1,990,985.82 9,297,128.79
| Decrease of inventory (increase is listed |
| Decrease of operating receivable |
accounts (increase is listed with “-”)
-36,896,366.90 -7,192,322.29
(decrease is listed with “-”)
-10,834,604.35 7,693,022.35
| Increase of operating payable accounts | ||
| Other | -200,149.24 | |
| Net cash flow arising from operating |
activities
-11,318,295.41 59,571,399.02
involved in cash flow
| 2. Material investment and financing not | ||
| Conversion of debt into capital | ||
| Switching Company bonds due |
within one year
| financing lease of fixed assets | ||
| 3. Net change of cash and cash |
equivalents:
| Balance of cash at period end | 188,890,609.03 | 358,059,693.02 |
| Less: Balance of cash equivalent at |
period-begin
211,655,585.86 208,462,656.63
equivalents
| Add: Balance at period-end of cash |
| Less: Balance at period-begin of |
cash equivalents
equivalents
-22,764,976.83 149,597,036.39
(2) Constitution of cash and cash equivalent
Unit: RMB/CNYItem Ending balance Opening balance
Net increase of cash and cashI. Cash
| I. Cash | 188,890,609.03 | 211,655,585.86 |
| Including: Cash on hand | 9,691.12 | 36,941.24 |
| Bank deposit available for |
payment at any time
188,880,917.91 211,618,644.62
at period-end
188,890,609.03 211,655,585.86
| 146 |
52. Assets with ownership or use right restricted
Unit: RMB/CNY
| Item | Ending book value | Reasons for restriction |
Monetary fund
27,188,802.59
Gold & Jewelry Industrial Park -
| supervision funds for the 03# land |
Intangible assets
45,934,295.01
Total 73,123,097.60
53. Foreign currency monetary
(1) Foreign currency monetary
Unit: RMB/CNYItem
Bank loan mortgageEnding foreign currency
balance
Convert rate
| Ending foreign currency balance | Ending RMB balance converted | ||
| Monetary funds | 682,909.72 | ||
| Including: USD | 104,030.95 | 6.5126 | 677,515.04 |
| EURO | |||
| HKD | 6,858.41 | 0.7866 | 5,394.68 |
54. Government grants
(1) Government grants
Unit: RMB/CNYCategory
Amount Item
| Amount reckoned into current gains/losses | ||
| Elevator Renewal Subsidy |
Fund for Futian District OldElevator Renovation Working
131,102.38Deferred income
| Group |
| Luohu District 2021 Special funds for industrial |
transformation and upgrading-
4,017,501.99Deferred income221,174.34
| industry service platform |
| Luohu District 2021 special funds for industrial |
transformation and upgrading-
2,500,000.00Deferred income163,043.46
| Green building support subsidy |
| Subsidy revenue from the Shenzhen Municipal Bureau of Commerce in 2020 to promote consumption to enhance the support project |
4,590,000.00Deferred income292,978.74
82,750.00 Other income 82,750.00
| Work-based vocational training subsidy |
| Stabilization subsidy from social security bureau |
6,679.80 Other income 6,679.80
| 147 |
VII. Changes of consolidation range
1. Increased in scope of consolidation
| Name | Ways to acquire equity | Time of equity acquisition | Contribution amount | Contribution ratio |
| Guorun Gold (Shenzhen) Co., Ltd. | Newly established | June 2022 | 7850 | 39.25% |
2. Enterprise combine under the same control
Not applicable
3. Reverse purchase
Not applicable
4. Disposal of subsidiaries
Not applicable
VIII. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Subsidiary
Main operationplace
Registeredplace
Business nature
Acquired way
| Share-holding ratio | |||
| Directly | Indirectly | ||
| Shenzhen | |||
TellusXinyongtongAutomobileDevelopment
Shenzhen Shenzhen Commerce
5.00% 95.00%
Establishment
| Co. Ltd |
| Shenzhen |
Bao’an ShiquanIndustrial Co.,
Shenzhen Shenzhen Commerce
100.00%
Establishment
| Ltd. |
| Shenzhen SDG |
Tellus Real
Shenzhen Shenzhen Manufacture
100.00%
Establishment
| Estate Co., Ltd. |
| Shenzhen |
TellusChuangying
Shenzhen Shenzhen Commerce
100.00%
Establishment
| Tech. Co., Ltd. |
| Shenzhen |
XinyongtongAuto VehicleInspectionEquipment Co.,
Shenzhen Shenzhen Commerce
51.00%
EstablishmentShenzhen AutoIndustry and
| Ltd. |
| Trade |
Shenzhen Shenzhen Commerce 100.00%Establishment
| 148 |
Corporation
| Corporation |
| Shenzhen |
AutomotiveIndustry Supply
Shenzhen Shenzhen Commerce
100.00%
Establishment
| Corporation |
| Shenzhen SDG |
Huari AutoEnterprise Co.,
Shenzhen Shenzhen Commerce 60.00%Establishment
| Ltd. |
| Shenzhen Huari |
AnxinAutomobile
Shenzhen Shenzhen Commerce
100.00%
EstablishmentShenzhenZhongtianIndustrial Co,.
| Inspection Ltd. |
| Ltd. |
Shenzhen Shenzhen Commerce 100.00%Establishment
TOYOTAAutomobileSales Service
| Co., Ltd. |
Shenzhen Shenzhen Commerce
60.00%
Establishment
Tellus TreasurySupply Chain
| Tech. Co., Ltd. |
Shenzhen Shenzhen Commerce 100.00%Establishment
JewelryIndustryService Co.,
| LTD |
Shenzhen Shenzhen Commerce 65.00%EstablishmentShanghaiFanyueDiamond Co.,
Shenzhen Shenzhen Commerce 100.00%Establishment
| Ltd. |
| Guorun Gold |
(Shenzhen)
Shenzhen Shenzhen Commerce 36% 3.25%Establishment
(2) Important non-wholly-owned subsidiary
Unit: RMB/CNYSubsidiary
Share-holding ratio of
minority
Co., Ltd.
Gains/losses
attributable to minority
| in the Period | Dividend announced to |
distribute for minority
Ending equity of
minority
| in the Period | ||
| Shenzhen Huari Toyota Auto Sales Co., Ltd |
40.00% -442,894.84 4,030,875.67
Auto Enterprise Co.,
| Ltd. |
40.00% 935,322.67 13,439,198.81
(3) Main finance of the important non-wholly-owned subsidiary
Unit: RMB/CNYSubsidiary
Ending balance Opening balanceCurrent assets
current
| assets |
Total
assets
t
| liabiliti | Non- |
current
| liabiliti | Total |
liabiliti
Current assets
| es | Non- |
current
Totalassets
| assets | Curren |
t
| liabiliti | Non- |
current
| liabiliti | Total |
liabiliti
| 149 |
es
| es | es | es | es | |||
| Shenz |
henHuariToyotaAutoSalesCo.,
76,682,138.5
4,176,
286.66
80,858,425.2
70,781,236.0
70,781,236.0
85,290,018.3
5,005,
912.12
90,295,930.4
79,111,504.1
79,111,
504.18
| Ltd |
| Shenz |
henSDGHuariAutoEnterpriseCo.,
59,268,648.8
19,665,196.1
78,933,844.9
45,093,542.9
45,093,542.9
61,681,938.5
20,655,893.7
82,337,832.3
50,835,836.9
50,835,836.9
Unit: RMB/CNYSubsidiary
Current period Last periodOperatingincome
Net profit
Ltd.
Total
comprehensive
| income | Cash flow |
fromoperation
Operating
income
Net profit
| activity | Total |
comprehensive
| income | Cash flow |
fromoperation
| activity | ||
| Shenzhen |
HuariToyotaAuto Sales
31,626,860.
798,121.42 798,121.42
15,892,157.
120,908,66
0.87
-1,096,939.0
-1,096,939.0
-1,066,151.6
| Co., Ltd |
| Shenzhen |
SDG HuariAutoEnterprise
18,688,992.
2,338,306.6
2,338,306.6
-19,176,506.
18,429,177.
1,882,612.7
1,882,612.7
68,643.14
2. Equity in joint venture and associated enterprise
(1) Important joint venture or associated enterprise
Joint venture orAssociatedenterprise
Main operation
place
Registered
place
Business nature
Co., Ltd.Share-holding ratio
| Share-holding ratio | Accounting |
treatment oninvestment forjoint ventureand associated
Directly Indirectly
| enterprise | ||
| Shenzhen |
Tellus GmanInvestment Co.,
Shenzhen Shenzhen
Investment andestablishmentof industries
50.00%
Equity methodaccountingShenzhen ZungFu Tellus AutoService Co.,
| Ltd |
| Ltd. |
Shenzhen ShenzhenSales of Benz
35.00%
Equity methodaccounting
| 150 |
(2) Main financial information of the important joint venture
Unit: RMB/CNY
Ending balance/Current period Opening balance/Last period
Ltd
| Shenzhen Tellus Gman Investment Co., | Shenzhen Tellus Gman Investment Co., |
Ltd
| Current assets | 30,303,217.19 | 45,816,920.84 |
| Including: Cash and cash equivalent | 26,391,630.67 | 41,913,040.87 |
| Non current assets | 357,067,102.52 | 366,402,308.03 |
| Total Assets | 387,370,319.71 | 412,219,228.87 |
| Current liabilities | 37,478,449.11 | 39,971,747.31 |
| Non current liabilities | 268,188,000.00 | 277,266,000.00 |
| Total liabilities | 305,666,449.11 | 317,237,747.31 |
| Minority interests | ||
| Shareholders' equity attributable to the |
parent company
81,703,870.60 94,981,481.56
shareholding ratio
40,851,935.30 47,490,740.78
| Share of net assets calculated by | ||
| Adjustment matters | ||
| --Goodwill | ||
| —Unrealized profit of internal trading | ||
| --Others | ||
| Book value of equity investment in joint |
ventures
56,229,882.88 47,490,740.78
joint venture with public offersconcerned
| Fair value of the equity investment of | ||
| Business income | 51,327,658.48 | 47,490,740.78 |
| Financial expenses | 7,454,900.88 | 7,886,096.17 |
| Income tax expenses | 5,826,094.71 | 3,082,111.84 |
| Net profit | 17,478,284.13 | 9,246,335.50 |
| Net profit of the termination of operation | ||
| Other comprehensive income | ||
| Total comprehensive income | 17,478,284.13 | 9,246,335.50 |
Dividends received from joint venturesduring the year
(3) Main financial information of the important associated enterprise
Unit: RMB/CNY
Ending balance/Current period Opening balance/Last period
| Shenzhen Zung Fu Tellus Auto Service | Shenzhen Zung Fu Tellus Auto Service |
| 151 |
Co., Ltd.
| Co., Ltd. | Co., Ltd. | |
| Current assets | 181,809,658.99 | 134,921,582.03 |
| Non current assets | 32,088,660.57 | 33,583,787.31 |
| Total Assets | 213,898,319.56 | 168,505,369.34 |
| Current liabilities | 139,022,780.57 | 90,311,356.93 |
| Non current liabilities | ||
| Total liabilities | 139,022,780.57 | 90,311,356.93 |
| Minority interests | ||
| Shareholders' equity attributable to the |
parent company
74,875,538.99 78,194,012.41
shareholding ratio
26,206,438.65 27,367,904.34
| Share of net assets calculated by | ||
| Adjustment matters | ||
| --Goodwill | ||
| —Unrealized profit of internal trading | ||
| --Other | ||
| Book value of equity investment in |
associated enterprise
26,206,438.65 27,367,904.34
associated enterprise with public offersconcerned
| Fair value of the equity investment of | ||
| Business income | 493,226,617.42 | 638,056,465.79 |
| Net profit | -3,318,473.42 | 21,570,821.49 |
| Net profit of the termination of operation | ||
| Other comprehensive income | ||
| Total comprehensive income | -3,318,473.42 | 21,570,821.49 |
Dividends received from associatesduring the year
(4) Financial summary for non-important Joint venture and associated enterprise
Unit: RMB/CNY
Ending balance/Current period Opening balance/Last period
| Joint venture: | ||
| Total book value of investment | 13,802,333.55 | 13,452,222.35 |
| Amount based on share-holding ratio | ||
| -- Net profit | 686,492.55 | 708,235.59 |
| -- Total comprehensive income | 686,492.55 | 708,235.59 |
| Associated enterprise: | ||
| Amount based on share-holding ratio |
| 152 |
(5) Excess loss occurred in joint venture or associated enterprise
Unit: RMB/CNYJoint venture/Associatedenterprise
Cumulative un-recognized
losses
recognized in the Period (ornet profit enjoyed in the
| Period) |
Cumulative un-recognizedlosses at period-end
Inspection Equipment Co.,
| Ltd. |
1,176,212.73 1,176,212.73
98,865.26 98,865.26IX. Risk related with financial instrument
The Company's risks related to financial instruments originate from various financial assets and financial liabilitiesrecognized by the Company in the course of operation, including credit risk, liquidity risk and market risk.The management of the Company is responsible for the management objectives and policies of various risks relatedto financial instruments of the Company. Operating management is responsible for daily risk management throughfunctional departments (e.g., the credit management department of the Company checks the credit sales of thecompany on a case-by-case basis). The internal audit department of the Company conducts daily supervision overthe implementation of the company's risk management policies and procedures and reports relevant findings to theaudit committee of the Company in a timely manner.The overall goal of the Company's risk management is to formulate risk management policies that may minimizethe risks associated with various financial instruments without unduly affecting the company's competitiveness andresilience.
1. Credit risk
Credit risk is the risk that one party of a financial instrument fails to fulfill its obligations, resulting in a financialloss to the other party. The credit risk of the Company is mainly generated from monetary funds, notes receivable,accounts receivable, receivables financing, other account receivable, contract assets, debt investment and long-termreceivables, etc. The credit risk of these financial assets is derived from the default of the counterparty, and themaximum risk exposure is equal to the book amount of these instruments.The Company's monetary funds are mainly deposited in commercial banks and other financial institutions. TheCompany believes that these commercial banks have high credit and asset status and low credit risk.For notes receivable, accounts receivable, receivables financing, Other account receivable, contract assets, debtinvestment and long-term receivables, the Company establishes relevant policies to control credit risk exposure.The Company evaluates customers' credit qualifications and sets up corresponding credit periods based on theirfinancial status, the possibility of obtaining guarantees from third parties, credit history and other factors such ascurrent market conditions. The Company regularly monitors the credit records of customers. For customers withpoor credit records, the Company will adopt written payment reminders, shortening or cancellations of credit periods,etc., to ensure that the Company's overall credit risk is within a controllable range.
(1) Judgment criteria for a significant increase in credit risk
| 153 |
On each balance sheet date, the Company evaluates whether the credit risk of the relevant financial instrument hasincreased significantly since the initial recognition. In determining whether the credit risk has increased significantlysince the initial recognition, the Company considers the reasonable and evidence-based information that can beobtained without unnecessary additional cost or effort, including qualitative and quantitative analysis based on theCompany's historical data, external credit risk ratings and forward-looking information. On the basis of a singlefinancial instrument or a portfolio of financial instruments with similar credit risk characteristics, the Companydetermines the change of the default risk during the expected duration of the financial instrument by comparing therisk of default of the financial instrument on the balance sheet date with the risk of default on the initial recognitiondate.When one or more of the following quantitative or qualitative criteria are triggered, the Company considers that thecredit risk of the financial instrument has significantly increased. The quantitative criteria mainly mean that theprobability of default of the remaining duration on the reporting date increases over a certain percentage comparedwith the initial recognition. The qualitative criteria are the significant adverse changes in major debtor's business orfinancial situation, the list of early warning customers, etc.
(2) Definition of assets with credit impairment
In order to determine whether credit impairment has occurred, the Company adopts the definition criteria consistentwith the internal credit risk management objectives for relevant financial instruments, and considers bothquantitative and qualitative indicators.When assessing whether the debtor has suffered credit impairment, the Company mainly considers the followingfactors: major financial difficulties of the issuer or the debtor; the debtor breaches the contract, such as the defaultor overdue payment of interest or principal; the creditor, for economic or contractual reasons relating to the debtor'sfinancial difficulties, gives the debtor concessions that it would not have given in any other circumstances; thedebtor is likely to go bankrupt or undergo other financial restructuring; the financial difficulties of the issuer ordebtor lead to the disappearance of the active market for the financial asset; purchase or origination of a financialasset at a substantial discount reflects the fact that a credit loss has occurred.The credit impairment of financial assets may be caused by the joint action of several events, but is not necessarilyby separately identifiable events.
(3) Parameters of expected credit loss measurement
Depending on whether the credit risk has significantly increased and whether the credit impairment has occurred,the Company measures the impairment reserve for different assets at the expected credit loss of 12 months or theentire duration respectively. The key parameters of expected credit loss measurement include probability of default,loss given default and exposure at default. The Company establishes the probability of default, loss given defaultand exposure at default model by taking into account the quantitative analysis and forward-looking information ofhistorical statistical data (such as counterparty rating, guarantee method and collateral type, repayment mode, etc.).Relevant definitions are as follows:
The probability of default is the probability that the debtor will not be able to meet its reimbursement obligations inthe next 12 months or in the entire duration.
| 154 |
Loss given default refers to the Company's expectation to the extent of loss caused by exposure at default. The lossgiven default also varies depending on the type of the counterparty, the type and priority of the claim, and thecollateral. The loss given default is the percentage of the risk exposure loss when the default occurs, which iscalculated on the basis of the next 12 months or the entire duration;Exposure at default is the amount payable by the Company at the time of the occurrence of default over the next 12months or over the entire remaining duration. Both the assessment of a significant increase in credit risk and thecalculation of expected credit losses involve the forward-looking information. Through historical data analysis, theCompany identifies the key economic indicators that affect the credit risk and expected credit loss of each businesstype.The maximum credit risk exposure of the Company is the carrying amount of each financial asset on the balancesheet. The Company does not provide any other guarantee which may expose the Company to credit risk.
2. Liquidity risk
Liquidity risk refers to the risk of capital shortage when an enterprise performs its obligations of settlement in theform of cash payment or other financial assets. The Company is responsible for the overall cash management of thecompany's subsidiaries, including short-term investment of surplus cash and financing of loans to meet projectedcash needs. It is the Company's policy to regularly monitor short - and long-term working capital requirements andcompliance with borrowing agreements to ensure adequate cash reserves and marketable securities readily availablefor cash for cash at any time.
As of June 30, 2022, the maturity periods of the company's financial liabilities are as follows:
Item
June 30, 2022Within one year 1-2 years 2-3 years Over 3 years
69,778,883.21
| Accounts payable |
| Other payable |
115,063,036.77
-current liabilities due within one
| year |
2,884,263.93
5,040,362.36 5,966,267.19 7,285,517.69 103,378,260.21
| Long term loan |
| Long |
-term payable
3,920,160.36
1,318,243.17 1,684,781.03 960,241.93
Total 193,802,442.70 7,284,510.36 8,970,298.72 104,338,502.14(Continued from above table)
Item
December 31, 2021Within one year 1-2 years 2-3 years Over 3 years
Lease liabilityAccounts payable
69,318,035.89
| Accounts payable |
| Other payable |
112,617,963.65
-current liabilities due within one 3,021,452.25
| 155 |
Item
December 31, 2021Within one year 1-2 years 2-3 years Over 3 years
| year |
| Long term loan |
3,644,467.25 4,609,457.14 5,967,792.71 118,790,550.21
-term payable 3,920,160.36
| Long |
| Lease liability |
1,829,520.13 1,684,781.03 960,241.93
Total 192,522,079.40 6,438,977.27 7,652,573.74 119,750,792.14
X. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
Unit: RMB/CNYItem
First-order Second-order Third-order Total
Ending fair valueI. Sustaining measured
by fair value
-- -- -- --
| I. Sustaining measured |
| (I) Transaction |
financial asset
422,095,775.34 422,095,775.34
measured at fair valueand whose changes areincluded in currentprofit or loss
422,095,775.34 422,095,775.34
| 1.Financial assets |
| (III) Other equity |
instrument investment
10,176,617.20 10,176,617.20Total assetscontinuously measuredat fair value
432,272,392.54 432,272,392.54
measure
-- -- -- --
2. The qualitative and quantitative information for the valuation technique and critical parameter that
sustaining and non-persistent measured by fair value on third-orderFinancial assets held for trading are the purchased structured deposits and wealth management products, and theexpected rate of return is used to predict the future cash flows, and the unobservable estimate is the expected rateof return. Investments in other equity instruments are measured at the investment cost as a reasonable estimate offair value because the operating environment, operating conditions and financial conditions of the investee company,China Pudong Development Machinery Industry Co., Ltd, have not undergone significant changes.
| 156 |
XI. Related party and related transactions
1. Parent company
Parent company Registration place Business nature Registered capital
shareholding on theCompany
Ratio of voting right
on the CompanyShenzhen SpecialDevelopmentGroup Co., Ltd.
Shenzhen
| Ratio of | ||
| Development and operation of real |
estate and domesticcommerce
RMB4,582,820,000
49.09% 49.09%
Explanation on parent company of the enterpriseShenzhen SDG Co., Ltd. is invested by the State-owned Assets Supervision and Administration Commission ofShenzhen Municipal People's Government and was established on August 1, 1981. The company now holds abusiness license with a unified social credit code of 91440300192194195C and a registered capital of 4582.82million yuan.Ultimate controller of the Company is Shenzhen Municipal People’s Government State-Owned AssetsSupervision and Administration Commission.
2. Subsidiary
Found more in Ⅷ. Equity in other entity in the Note
3. Joint venture and associated enterprise
Found more in Ⅷ. Equity in other entity in the Note
Other cooperative enterprise and joint venture that have related transaction with the Company in the Period oroccurred in previous period:
| Joint venture/Associated enterprise | Relationship |
| Shenzhen Xinyongtong Auto Service Co., Ltd. | Former associate, transferred in previous period |
| Shenzhen Tellus Xinyongtong Auto Service Co., Ltd. | Associated company |
| Shenzhen Tellus Automobile Service Chain Co., Ltd. | Associated company |
| Shenzhen Yongtong Xinda Inspection Equipment Co., Ltd. | Associated company |
| Shenzhen Xiandao New Material Co., Ltd. | Associated company |
| Shenzhen Tellus Hang Investment Co., Ltd. | Joint venture |
4. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
| 157 |
Unit: RMB/CNYRelated party
Related transactioncontent
Current Period
Approvedtransaction limit
the transaction
| limit (Y/N) |
Last Period
EngineeringManagement Co.,
| Ltd. |
Accept labor430,000.00 N 518,499.99
Tellus PropertyManagement Co.,
| Ltd. |
Accept labor1,529,149.09 15,700,000.00 N 7,668,080.71
Service Co., Ltd.Jewelry Park
| Branch |
Accept labor5,236,179.69 360,000.00 N 412,752.47
Unit: RMB/CNY
| Related party | Related transaction content | Current Period | Last Period |
| Shenzhen SDG Petty Loan Co., Ltd. |
Providing services94,975.53 80,602.62
Property Management Co.,
| Ltd. |
Providing services54,548.96 36,701.08
(2) Related lease
As a lessor for the Company:
Unit: RMB/CNYLessee Assets type
| Lease income in recognized in the Period | Lease income in recognized last the Period | ||
| Shenzhen Zung Fu Tellus Auto Service Co., Ltd. |
House lease2,595,238.12 2,595,238.12Shenzhen Xinyongtong Auto
House lease404,910.00
| Service Co., Ltd. |
| Shenzhen SD Petty Loan Co., Ltd. |
House lease654,081.87 495,064.92
Property Management Co.,
| Ltd. |
House lease15,155.24 23,041.90
House lease1,108,284.57 542,136.57
| Shenzhen SDG Service Co., Ltd. Jewelry Park Branch | |||
| Subtotal | 4,788,605.52 | 4,357,391.51 |
(3) Related guarantee
As guarantor
Unit: RMB/CNYSecured party Guarantee amount Guarantee start date Guarantee expiry date
| Whether the guarantee has been fulfilled | ||
| Shenzhen Zung Fu |
Tellus Auto Service
3,500,000.00 2007-04-17 N
| 158 |
(4) Related party’s borrowed funds
Not applicable
(5) Remuneration of key manager
Unit: RMB/CNYItem Current period Last periodTotal pre-tax remuneration received from
3,258,800.00 2,695,100.00
5. Receivable and payable of related party
(1) Receivable item
Unit: RMB/CNYItem Name Related party
Ending balance Opening balanceBook balance Bad debt provision Book balance Bad debt provisionAccountsreceivable
the CompanyShenzhen
Xinyongtong Auto
| Service Co., Ltd. |
0.00 0.00
Service Co., Ltd.Jewelry Park
| Branch |
1,605.4 91.68 9,167.57 91.68
186,202.60 177.91 17,791.06 177.91
| Shenzhen SD Petty Loan Co., Ltd. | |||||
| Subtotal | 187,808 | 269.59 | 26,958.63 | 269.59 |
Other accountreceivable
AutomobileService Chain Co.,
| Ltd. |
1,359,297.00 1,359,297.00 1,359,297.00 1,359,297.00
Yongtong XindaInspectionEquipment Co.,
| Ltd. |
531,882.24 531,882.24 531,882.24 531,882.24
New Material Co.,
| Ltd. |
660,790.09 660,790.09 660,790.09 660,790.09
Shenzhen SDGTellus PropertyManagement Co.,
13,659.18 128.30 12,829.59 128.30
| Ltd. | |||||
| Subtotal | 2,565,628.51 | 2,552,097.63 | 2,564,798.92 | 2,552,097.63 |
Long-termreceivables
AutomobileService Chain Co.,
| Ltd. |
2,179,203.68 2,179,203.68 2,179,203.68 2,179,203.68
| Subtotal | 2,179,203.68 | 2,179,203.68 | 2,179,203.68 | 2,179,203.68 |
| 159 |
(2) Payable item
Unit: RMB/CNYItem Name Related party Ending book balance Opening book balanceAccounts payable
Co., Ltd
6,054,855.46 6,054,855.46
| Shenzhen SDG Real Estate |
| Shenzhen Machinery |
Equipment Import & ExportCorporation
45,300.00 45,300.00
Investment Co., Ltd
200,000.00 200,000.00
| Shenzhen Tellus Gman |
| Shenzhen SDG Engineering |
Management Co., Ltd
38,905.66 150,005.66
Property Management Co.,Ltd.
1,708,125.16 1,708,125.16
| Shenzhen SDG Tellus | |||
| Subtotal | 8,047,186.28 | 8,158,286.28 |
Other payable
Co, Ltd.
1,961,673.06
1,961,673.06
| Hong Kong Yujia Investment |
| Shenzhen SDG Swan |
Industrial Co., Ltd.
28,766.05
28,766.05
Equipment Imp & Exp.Company
1,575,452.52 1,575,452.52
| Shenzhen Machinery |
| Shenzhen Special |
Development Group Co., Ltd.
12,369,413.94 17,383,655.94
Real Estate Co., Ltd.
1,095,742.50 1,095,742.50
| Shenzhen Longgang Tellus |
| Shenzhen Tellus Yangchun |
Real Estate Co., Ltd.
476,217.49 476,217.49
Investment Co., Ltd.
11,144.73 167,470.29
| Shenzhen Tellus Hang |
| Shenzhen Yongtong Xinda |
Inspection Equipment Co.,Ltd.
5,600.00 5,600.00
Property Management Co.,Ltd.
30,428.43 122,141.49
| Shenzhen SDG Tellus |
| Shenzhen SDG Service Co., |
Ltd. Jewelry Park Branch
22,680.00 29,278.00
Auto Service Co., Ltd.
833,334.00 833,334.00
| Shenzhen Zung Fu Tellus |
| Shenzhen SD Petty Loan Co., |
Ltd.
237,804.66 237,804.66
| 160 |
Management Co., Ltd
40,000.00 56,600.00
| Shenzhen SDG Engineering |
| Shenzhen SDG Service Co., |
Ltd.
5,832.00
| Subtotal | 18,688,257.38 | 23,979,568.00 |
XII. Commitment or contingency
1. Important commitments
Important commitments at the balance sheet date
(1) Capital commitment
Capital commitments that have been signed but not yet confirmed in
the financial statements
June 30, 2022 December 31, 2020
153,763,306.33 220,523,772.58
2. Contingency
(1) Contingency on balance sheet date
In October 2005, the Company filed a lawsuit with the Luohu District People's Court of Shenzhen, requesting thatJintian Industrial (Group) Co., Ltd. (hereinafter referred to as Jintian Company) be ordered to pay the amountsforcibly deducted due to the Company's guarantee for its bank borrowings, totally 4,081,830 yuan (including 3million yuan in principal, 1,051,380 yuan in interest, 25,160 yuan in litigation fees, and 5,290 yuan in executionfees). The court has ruled in favor of the Company, and the Company has applied for compulsory execution. TheCompany made loss accounting treatment for the deducted funds in previous years.In April 2006, Shenzhen Development Bank sued Jintian Company for the overdue loan repayment of 2 million USdollars and the Company’s guarantee for it. After the Company took over the principal of Jintian Company's loanof 2 million US dollars and all interests, the Company filed an appeal to the Luohu District People's Court ofShenzhen, requesting that Jintian Company be ordered to pay our company 2,960,490 US dollars and the interestsrepaid by our company on its behalf. In 2008, mediated by Luohu District People's Court of Shenzhen, both partiesreached a civil mediation agreement ((2008) SLFMYCZ No. 937), and reached the following agreements: JintianCompany should repay 2,960,490 US dollars to the Company before October 31, 2008, the Company shall exemptJintian Company from its obligation to pay interest. If Jintian Company fails to pay on time, it shall pay the penaltyfor overdue payment according to the RMB benchmark loan interest rate for the same period announced by thePeople's Bank of China from that day. Jintian Company goes through bankruptcy, reorganization and debt repaymentprocedures. On January 29, 2016, Shenzhen Intermediate People's Court ruled that the execution of thereorganization plan of Jintian Company was completed and the bankruptcy proceedings were terminated. JintianCompany should make additional distributions to creditors including the Company according to the reorganizationplan, and the Company should be distributed cash of 325,000 yuan and 427,604 A shares and 163,886 B shares of
| 161 |
Jintian Company. As of the date of approval of the financial report, the Company has not received the distributedproperty. On August 15, 2018, after failing to communicate with Jintian for many times about the cash and sharesto be distributed after the bankruptcy and reorganization of Jintian Company, the Company filed a lawsuit with thePeople's Court of Qianhai Cooperation Zone, and the Qianhai Court issued a civil judgment (2018) Yue 0391 MinChu No. 3104, Jintian Company was ordered to pay the Company 325,000 yuan in cash and 427,604 A shares and163,886 B shares of Jintian Company within five days of the legal effect of this judgment (if the shares cannot bedelivered, they may be paid in cash at the market price of the shares on the last day of the deadline for performance).
As of June 30, 2022, the Company had fulfilled a payment of 400,808.02 yuan (including 325,000 yuan in cash asdetermined in the judgment and a total of 75,808.02 yuan in cash such as B-shares converted to cash, preservationfees, delayed performance fees, etc.), and 427,604 A-shares had been transferred to the account designated by thecourt, the company had also submitted an account to accept Jintian's A-shares, and was waiting for the QianhaiCourt to transfer the aforesaid funds and stocks to the Company.
XIII. Other important events
1. Segment
(1) Recognition basis and accounting policy for reportable segment
The Company determines operating (segment) divisions based on internal organizational structure, managementrequirements and internal reporting system, and determines the reporting segment based on the industry segment.Respectively assess the operating performance of automobile sales, automobile maintenance and testing, leasingand services, and jewelry wholesale and retail. The assets and liabilities used with each segment are distributedamong the different segments in proportion to their size.
(2) Financial information for reportable segment
Unit: RMB/CNYItem
Auto sales
Automaintenanceand inspection
Leasing and
services
Wholesale andretail of jewelry
Offset between
segment
TotalMain businessincome
90,748,050.16 26,147,132.30 100,183,766.89 48,246,045.45 -15,309,842.57 250,015,152.23Main businesscost
89,009,452.61 18,754,863.60 43,466,666.56 53,215,540.26 -16,102,345.48 188,344,177.55Total assets
39,848,642.72 141,387,032.02
2,922,091,666.
106,295,526.07
1,267,962,334.
| 32 |
1,901,811,890.
| 162 |
Total liability
40,644,046.54 96,674,136.98 834,493,197.93 37,438,315.55
412,306,255.00
XIV. Principal notes of financial statements of parent company
1. Account receivable
(1) Category
Unit: RMB/CNYCategory
Ending balance Opening balanceBook balance Bad debt provision
Bookvalue
Book balance Bad debt provision
BookvalueAmount Ratio Amount
Accrual
ratio
Amount Ratio Amount
AccrualratioAccountreceivable withbad debtprovision accrualon asinglebasis
484,803.
15.14%
484,803.
100.00%
484,803.
65.79%
484,803.
100.00%
Accountreceivable withbad debtprovision accrualonportfolio
2,717,23
9.31
84.86% 1,847.01 0.07%
2,715,39
2.30
120,861.
34.21% 1,847.01 1.53%
119,014.
Total
-596,943,442.003,202,04
2.39
100.00%
| 3,202,042.39 | 486,650.09 |
15.20%
| 2,715,392.30 | 605,664.50 |
100.00%
80.35%
| 486,650.09 | 119,014.41 |
On June 30, 2022, account receivable with bad debt provision accrual on a single basis
Unit: RMB/CNYName
Ending balanceBook balance Bad debt provision Accrual ratio Accrual causesShenzhen BijiashanEntertainmentCompany
172,000.00 172,000.00 100%
The account age is longand is not expected tobe recoveredGong Yanqing97,806.64 97,806.64 100%
The account age is longand is not expected to
Guangzhou LeminComputer Center
86,940.00 86,940.00 100%
The account age is longand is not expected tobe recoveredOther 128,056.44 128,056.44 100%
be recoveredThe account age is longand is not expected to
| 163 |
be recovered
Total 484,803.08 484,803.08
By account age
Unit: RMB/CNYAccount age Ending balanceWithin one year (including one year)2,717,239.31Over 3 years 484,803.08
Over 5 years484,803.08Total 3,202,042.39
(2) Bad debt provision accrual, collected or reversal in the period
Bad debt provision accrual in the period:
Unit: RMB/CNYCategory
Openingbalance
Amount changed in the period
Ending balanceAccrual
Collected orreversal
Written-off Other
be recoveredBad debt
provisionaccrual on a
| single basis |
484,803.08 484,803.08
bad debts by
| combination |
1,847.01 1,847.01Total486,650.09 486,650.09
(3) Top 5 account receivables at ending balance by arrears party
Unit: RMB/CNYEnterprise
| Ending balance of accounts receivable | Proportion in total receivables at ending balance | Bad debt preparation ending balance | |
| Shenzhen Zung Fu Tellus Auto Service Co., Ltd. |
2,595,238.08 81.05%Shenzhen BijiashanEntertainment Company
172,000.00 5.37% 172,000.00
117,501.42 3.67% 2,487.23
| Shenzhen Jincheng Yinyu Jewelry Co., Ltd. | |||
| Gong Yanqing | 97,806.64 | 3.05% | 97,806.64 |
Guangzhou Lemin ComputerCenter
86,940.00 2.72% 86,940.00Total 3,069,486.14 95.86%
2. Other account receivable
Unit: RMB/CNYItem Ending balance Opening balanceInterest receivable 0.00 0.00
| 164 |
Dividends receivable 547,184.35 547,184.35Other account receivable1,715,853.02 89,854,408.23Total 2,263,037.37 90,401,592.58
(1) Dividends receivable
1) Category
Unit: RMB/CNYItem (or invested unit) Ending balance Opening balance
547,184.35 547,184.35Total547,184.35 547,184.35
2) Important dividend receivable with account age over one year
Unit: RMB/CNYItem (or invested unit) Ending balance Account age
Reasons for non-recovery
Whether there isimpairment and itsjudgment basisChina PudongDevelopmentMachinery IndustryCo., Ltd
547,184.35 2-3 years Not yet paid
The enterprise has anormal financial statusand operationconditions, thedividend receivablehave not been
China Pudong Development MachineryIndustry Co., Ltdimpaired.
Total 547,184.35
3) Provision for bad debts
□ Applicable √Not applicable
(2) Other account receivable
1) By nature
Unit: RMB/CNYNature Ending book balance Opening book balance
impaired.Other interim payment receivable
| Other interim payment receivable | 14,288,238.53 | 13,776,179.52 |
| Related transactions within the scope of consolidation |
1,021,365.19 89,671,979.41Total 15,309,603.72 103,448,158.93
2) Provision for bad debts
Unit: RMB/CNYBad debt provision
| Phase I | Phase II | Phase III |
Total
| Expected credit losses over next 12 months | Expected credit losses for the entire duration | Expected credit losses for the entire duration |
| 165 |
(without creditimpairment occurred)
| (without credit impairment occurred) | (with credit impairment occurred) |
Balance on Jan. 1,2022
10,804.96 13,582,945.74 13,593,750.70Balance on Jun. 30,2022
10,804.96 13,582,945.74 13,593,750.70Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
By account age
Unit: RMB/CNYAccount age Ending balanceWithin one year (including one year) 1,721,258.06Over 3 years 13,588,345.66
Over 5 years13,588,345.66Total 15,309,603.72
3) Bad debt provision accrual, collected or reversal in the period
Bad debt provision accrual in the period:
Unit: RMB/CNYCategory
Openingbalance
Amount changed in the period
Ending balanceAccrual
Collected or
reversal
Written-off Other
provisionaccrual on a
| single basis |
13,588,345.66 13,588,345.66
bad debts by
| combination |
5,405.04 5,405.04Total 13,593,750.70 13,593,750.70
5) Top 5 other receivables at ending balance by arrears party
Unit: RMB/CNYEnterprise Nature Ending balance Account age
ending balance ofother account
| receivables |
Ending balance of
bad debt reserve
Zhonghao (Group)
| Co., Ltd |
Intercourse funds 5,000,000.00 Over 3 years 32.66% 5,000,000.00
ElectricalAppliances
| Company |
Intercourse funds 2,706,983.51 Over 3 years 17.68% 2,706,983.51ShenzhenPetrochemical
Intercourse funds 1,898,419.67 Over 3 years 12.40% 1,898,419.67
| Group |
| Offesetting debt |
claims from
Intercourse funds 1,212,373.79 Over 3 years 7.92% 1,212,373.79
| 166 |
Packaging
| Packaging |
| Shenzhen Jewelry |
Industry Service
Intercourse funds 1,021,190.59 Over 3 years 6.67%Total
11,838,967.56
77.33% 10,817,776.97
3. Long-term equity investment
Unit: RMB/CNYItem
Ending balance Opening balanceBook balance
Impairmentprovision
Book value Book balance
Impairmentprovision
Book value
Co., LTDInvestment forsubsidiary
714,245,472.73 1,956,000.00 712,289,472.73 694,745,472.73 1,956,000.00 692,789,472.73
| Investment for subsidiary |
| Investment for |
associates and
91,025,817.37 9,787,162.32 81,238,655.05 98,098,029.79 9,787,162.32 88,310,867.47Total 805,271,290.10 11,743,162.32 793,528,127.78 792,843,502.52 11,743,162.32 781,100,340.20
(1) Investment for subsidiary
Unit: RMB/CNYThe investedentity
Openingbalance(book value)
joint ventureIncrease and decrease in current period
Endingbalance(book value)
| Increase and decrease in current period | Ending | |
balance ofimpairment
Additionalinvestment
Reduceinvestment
Provision forimpairment
Other
| provision | ||
| Shenzhen |
SDG TellusReal Estate
31,152,888.8
31,152,888.8
| Co., Ltd. |
| Shenzhen |
TellusChuangyingTechnology
14,000,000.0
14,000,000.0
| Co., Ltd. |
| Shenzhen |
TellusXinyongtongAutomobileDevelopment
57,672,885.2
57,672,885.2
| Co. Ltd. |
| Shenzhen |
ZhongtianIndustrial
369,680,522.
369,680,522.
| Co,. Ltd. |
| Shenzhen |
AutoIndustry andTrade
126,251,071.
126,251,071.
ShenzhenSDG HuariAutoEnterprise
| Corporation |
| Co., Ltd. |
19,224,692.6
19,224,692.6
Huari
| TOYOTA |
1,807,411.52 1,807,411.52
| 167 |
Automobile
Sales Service
| Co., Ltd. |
| Shenzhen |
XinyongtongAutomobileInspectionEquipment
10,000,000.0
10,000,000.0
ShenzhenTellusTreasurySupply ChainTech. Co.,
| Co. Ltd. |
| Ltd. |
50,000,000.0
50,000,000.0
Hanli High-TechCeramics
| Co., Ltd. |
0.00 0.00 1,956,000.00
JewelryIndustryService Co.,
| LTD |
13,000,000.0
19,500,000.0
32,500,000.0
Total
| 692,789,472.73 | 19,500,000.00 |
1,956,000.00
(2) Investment for associates and joint venture
Unit: RMB/CNYInvestmentcompany
Openin
gbalance
(bookvalue)
712,289,472.
Current changes (+, -)
Endingbalance(bookvalue)
Endingbalance
ofimpairmentprovisi
onAdditio
nalinvestm
ent
Capitalreducti
on
| Current changes (+, -) | ||
| Investm | ||
entgainsrecogni
zedunder
Othercomprehensiveincomeadjustm
ent
Otherequitychange
| equity | Cash |
dividend orprofitannounced to
Accrualofimpairmentprovisi
on
Other
| issued | ||
| I. Joint venture | ||
ShenzhenTellusGmanInvestment Co.,
47,490,
740.78
8,739,1
42.07
15,000,
000.00
41,229,
882.85
| Ltd |
| Shenzh |
enTellusHangInvestment Co.,
13,452,
222.35
350,111
.20
13,802,
333.55
Subtotal
60,942,
963.13
9,089,2
53.27
55,032,
216.40
Ltd.II. Associated enterprise
| II. Associated enterprise | ||
| Shenzhen | 27,367,904.34 | |
| -1,161,4 | 26,206,438.65 |
| 168 |
Zung
FuTellusAutoServiceCo.,
| Ltd. | 65.69 | |
| Hunan |
ChangyangIndustrial Co.,
1,810,5
40.70
| Ltd. |
| Shenzh |
enJiechengElectronic Co.,
3,225,0
00.00
ShenzhenXiandao NewMaterials Co.,
| Ltd. |
| Ltd. |
4,751,6
21.62
Subtotal
27,367,
904.34
1,161,4
| 65.69 |
26,206,
438.65
9,787,1
62.32
Total
| 88,310,867.47 | 81,238,655.05 | 9,787,162.32 |
4. Operating income and operating cost
Unit: RMB/CNYItem
Current period Last period
| Income | Cost | Income | Cost | |
| Main business | 12,666,278.27 | 5,003,948.63 | 19,483,635.23 | 5,163,217.03 |
Total 12,666,278.27 5,003,948.63 19,483,635.23 5,163,217.03
5. Investment income
Unit: RMB/CNYItem Current period Last period
7,927,787.58 12,534,155.42
| Long-term equity investment income measured by equity |
| Investment income from the disposal of long-term equity investments |
21,843.90
5,715,948.58 2,053,727.05Total 13,643,736.16 14,609,726.37
| 169 |
XV. Supplementary information
1. Current non-recurring gains/losses
√ Applicable □Not applicable
Unit: RMB/CNYItem Amount Note
current gains/losses (except for those withnormal operation business concerned, and
| conform to the national policies & |
regulations and are continuously enjoyedat a fixed or quantitative basis accordingto certain standards)
1,575,990.30 Government subsidies
Losses/gains from changes of fair values
assets and trading financial liabilities, and
| investment income obtaining from the disposal of trading financial assets, |
trading finan
assets available-for-
| sale, excluded |
effective hedging business relevant withnormal operations of the Company
6,157,679.97 Wealth management income
aforementioned items
295,569.76
| Other non-operating income and expenditure except for the | The lease deposit transferred to non- |
operation income upon early surrender oflease by tenant
| Transfer of equity gains and losses | 8,785,410.47 | |
| Less: Impact on income tax | 4,124,792.46 | |
| Impact on minority interests | 232,778.21 |
Total12,457,079.83--Details of other gains/losses items that meet the definition of non-recurring gains/losses:
□ Applicable √ Not applicable
There are no other gains/losses items that meet the definition of non-recurring gains/losses in the Company.Explain the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A AnnouncementNo.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss
□ Applicable √Not applicable
2. ROE and earnings per share
Profits during report period Weighted average ROE
| Earnings per share | |||
| Basic EPS (RMB/share) | Diluted EPS (RMB/share) | ||
| Net profits belong to common stock stockholders of the | |||
3.00% 0.1009 0.1009
| 170 |
Company
| Company |
| Net profits belong to common stock stockholders of the Company after deducting |
nonrecurring gains and losses
2.14% 0.0720 0.0720
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √Not applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for the differences
adjustment audited by foreign auditing institute, listed name of the institute
□ Applicable √Not applicable